Standard & Poor's on Wednesday lowered its corporate credit rating on Chiquita -- already at junk status -- from B-minus to D. S&P; also downgraded its rating on the company's 9.625 percent senior unsecured debt in light of Chiquita's failure to make a $12 million interest payment that had been due Tuesday on those debt issues.

It was the latest in years of bad news for the nation's largest banana producer, which has battled European banana import quotas, seen world banana prices drop because of a glut of the fruit, endured mounting debt, stopped paying dividends and reduced its work force.

"Chiquita has a long history of peaks and valleys. This is obviously a valley," said John McMillin of Prudential Securities, an analyst who has remained supportive of Chiquita even as its stock price fell from $50 per share in 1991 to less than $1.50 now. "But I think rumors of their death are premature."

Steven G. Warshaw, president and chief operating officer, said Tuesday that Chiquita plans to meet with bondholders in the coming months to try to work out an arrangement to restructure debt and help the company meet its obligations. Subsidiary companies, meanwhile, will continue business as usual.

The parent company hopes to reach an agreement to avoid having to file for bankruptcy protection. An agreement still could require approval of a bankruptcy court.

If Chiquita files for bankruptcy protection, bondholders would be in line to get paid ahead of shareholders.

"The big question is, what's going to be left for the shareholders?" McMillin said. "It's a risky situation. Shareholders are last on the totem pole."

Chiquita's stock slipped 50 cents, or 32 percent, to close at $1.06 a share.

Cincinnati multimillionaire Carl Lindner, Chiquita's chairman and chief executive officer, and his family collectively own about 40 percent of Chiquita through Lindner's American Financial Group. A Lindner spokeswoman did not return a call for comment Wednesday.

Warshaw said the European Union's quotas on banana imports, which Chiquita says have cost the company millions over the years, are behind the company's problems. But McMillin and others said management bears at least some responsibility for having increased Chiquita's debt in the early 1990s for expanding the company's shipping fleet and other investments, then not having whittled that debt in later years while the company remained financially healthy.

The Cincinnati-based company has been an economic powerhouse for decades in job-starved Central America. The Clinton administration went to bat for Chiquita to help it fight the European Union's limits on banana imports.

The company also may have a valuable ally in the administration of President-elect Bush. Joseph W. Hagin recently left his job as Chiquita's vice president for corporate affairs to become deputy chief of staff in Bush's White House. Hagin served as White House appointments secretary for Bush's father, former President George Bush.