Moody's lowers Majestic

Moody's Investors Service said it lowered Majestic Holdco, LLC's probability of default rating to Ca/LD from Ca in recognition of the announcement that the Majestic Star Casino, LLC, the company's primary operating subsidiary, did not make the Oct. 15 interest payments with respect to its $300 million 9½% senior secured notes due 2010 and $200 million 9¾% senior notes due 2011 prior to expiration of the grace period to cure such payment defaults on Nov. 14.

As a result, there is an event of default under the indentures governing these notes as well as under the company's $80 million secured bank facility, the agency said.

Additionally, there is an event of default under the indenture governing the Majestic Holdco, LLC 12½% senior discount notes, $63.5 million in principal, due 2011, the agency said.

Moody's said its previous rating action related to Majestic Holdco, LLC and the Majestic Star Casino, LLC occurred on October 14 following the announcement that the Majestic Star Casino, LLC did not intend to make the October 15 interest payments on its senior secured and senior unsecured notes.

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