Moody's lowers Dobson ratings

Moody's Investors Service said it downgraded the ratings of Dobson Communications Corp. and its subsidiaries, Dobson Cellular Systems and American Cellular.

The outlook is negative.

Moody's said the rating actions follow the company's poor financial performance in fourth quarter 2003 and management guidance for continued weak performance in 2004, which combined are expected to considerably reduce the company's financial flexibility.

Ratings downgraded include Dobson Communications' senior implied rating to B2 from B1, issuer rating to Caa1 from B3, $300 million 10.875% senior notes due 2010 to Caa1 from B3, $650 million 8.875% senior notes due 2013 to Caa1 from B3, $61 million 12.25% senior exchangeable preferred stock due 2008 to Caa3 from Caa2, $196 million 13.0% senior exchangeable preferred stock due 2009 to Caa3 from Caa2. Also downgraded were Dobson Cellular Systems Inc.'s $150 million senior secured revolving credit expiring 2009 to B1 from Ba3 and $550 million senior secured term loan maturing 2010 to B1 from Ba3.

Moody's also lowered American Cellular Corp.'s $900 million 10% senior notes due 2011 to B3 from B2.

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