S&P drops Inn of the Mountain Gods

Standard & Poor's said it lowered its issuer credit rating for Inn of the Mountain Gods Resort and Casino to D from CCC while it also lowered the issue-level rating on the company's $200 million of 12% senior unsecured notes due Nov. 15, 2010 to D from CCC.

The rating actions stem from its understanding, as indicated per the indenture trustee, that Inn of the Mountain Gods did not make the $12 million interest payment on the notes due May 15, 2009, the agency added.

According to S&P, a payment default has not occurred relative to the legal provisions of the notes, because there is a 30-day grace period in which to make the interest payment.

However, the agency said it considers a default to have occurred, even if a grace period exists, when the nonpayment is a function of the borrower being under financial distress.

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