S&P cuts O'Charley's

Standard & Poor's said it lowered the corporate credit rating on O'Charley's Inc. to B from B+.

The outlook is stable.

S&P lowered the issue-level rating on the company's subordinated debt to B- from B. The recovery rating remains 5, indicating the expectation for modest (10%-30%) recovery in the event of a payment default.

The downgrade reflects the expectation that commodity costs, such as beef and poultry, will rise further in 2011 and the operating environment will be unfavorable due to high unemployment and intense competition, S&P said.

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