Having reached agreements with its lenders and the Official Committee of Unsecured Creditors, who together represent all of the company’s funded debt, Tropicana Entertainment, LLC began distributing ballots on its Chapter 11 plans of reorganization with a letter from the committee urging voters to accept the plans developed by the company’s new board and management team. The plans of reorganization, which are the result of a process that began when Tropicana filed for protection from its creditors a year ago, generally call for secured debt to be converted to common stock and for general unsecured debt to be discharged in exchange for warrants, interests in a litigation trust and cash for certain creditors. The plans also cancel all the equity interests of former owner William J. Yung III, who will not hold any positions with the company. Creditors who are allowed to vote have until April 17, 2009, to submit their ballots. If creditors vote to accept the plans and the Bankruptcy Court finds that they meet all statutory requirements at confirmation hearings scheduled to begin April 27, 2009, Tropicana hopes to emerge from Chapter 11 soon thereafter. In its letter to creditors, the committee wrote that its support is the result of “vigorous negotiations” among Tropicana, the secured lenders and the committee. The letter asserts that the committee obtained what “it believes is improved treatment for all classes of general unsecured claims compared with treatment proposed in previously-filed versions.” “Due to the facts and circumstances of the [Tropicana] cases, in particular, the litigation risk and uncertainty associated with challenging valuation and confirmation … the committee recommends that general unsecured creditors vote to accept the [current] plan,”
the letter continued. “Understanding that the backdrop for this effort has been the nation’s continuing financial crisis, we commend our lenders and the committee for engaging in a highly productive negotiation,” said Tropicana CEO Scott C. Butera. “Our plan is stronger for these efforts because we have been able to take into account the interests of all the company’s key stakeholders. Our employees have earned our highest respect. Throughout the restructuring process, they have been enthusiastic and extremely loyal. Now, with renewed regulatory and community relationships, stronger employee relations, and better overall business systems in place, we feel we have the resources necessary to operate in the highly competitive hospitality and gaming industry.”
Tropicana Entertainment is one of the largest privately held gaming entertainment providers in the United States. The company operates 540,000 square feet of casino space with 15,000 slot machine positions. With more than 11,000 employees and 8,300 hotel rooms at its properties, it produces in excess of $1.2 billion annual revenue.
No comments:
Post a Comment