Image via Chukchansi Gold Facebook page
Written by The Business Journal Staff
The Chukchansi Economic Development Authority is celebrating what it is calling a “historic debt restructuring” that has reduced its obligations by nearly 70%.
The operator of Chukchansi Gold Resort & Casino announced the new credit agreement with Phoenix-based Western Alliance Bank that reduces debt from $350 million, including principal and accrued and unpaid interest, to approximately $110 million.
The settlement comes in part due to the successful reopening of the Chukchansi Gold Resort & Casino following its nearly three-month closure due to Covid-19, according to a news release.
“Since being elected to office in 2015, I’ve prioritized working with stakeholders to strategize and implement a comprehensive agreement that would significantly reduce … debt,” said Claudia Gonzales, chairwoman of the Chukchansi Economic Development Authority (CEDA). “Today, our Tribal Community has reached a major milestone in our efforts to secure financial independence. This debt restructuring complements our overall economic development initiatives and solidifies our place as a stable regional employer. I would like to thank all of those whose support, dedication and cooperation have enabled us to achieve this final step.”
As part of the final agreement, CEDA’s obligations in relation to its 9 ¾% senior notes due 2020 (the “Existing Notes”) have been satisfied through a new first lien senior loan provided by Western Alliance Bank and a pro rata exchange of all outstanding amounts of Existing Notes for new 8% senior secured notes due 2028 in an aggregate principal amount of more than $80 million.
Additionally, pursuant to the settlement, all outstanding litigation has been settled and closed – bringing an end to a lawsuit initially filed against CEDA by the trustee regarding the Existing Notes.
“The significant reduction in debt will ensure CEDA’s ability maintain the region’s highest quality resort casino experience while allowing the Chukchansi Tribe to expand its economic development initiatives in the region,” according to a news release.