The moratorium on deepwater drilling imposed by the U.S. Department of Interior will significantly diminish utilization and dayrates in the Gulf of Mexico. We lowered our corporate credit rating on Hornbeck Offshore Services Inc. to 'B+' from 'BB-' and lowered the issue-level rating on the senior unsecured debt to 'B+' from 'BB-'. The rating action reflects our assumption that Hornbeck's considerable exposure to deepwater drilling activities in the Gulf of Mexico and the current deepwater drilling moratorium will adversely affect Hornbeck's already weak credit metrics. As a result of the moratorium, financial measures are expected to be weaker than had been expected. On June 8, 2010, Standard&Poor's Ratings Services lowered its corporate credit rating on Hornbeck Offshore Services
