Black Gaming emerges from bankruptcy with new cash investment

By Caroline Salls

Pittsburgh, Aug. 4 - Black Gaming, LLC's plan of reorganization took effect on Wednesday, according to a filing with the U.S. Bankruptcy Court for the District of Nevada.

The plan was confirmed on July 21.

Chief executive officer Robert R. Black Sr. said then that the company's debt would be reduced by more than $143 million, and it would exit bankruptcy with "a more manageable capital structure."

Under the terms of the confirmed plan:

• The company's senior credit facility with Wells Fargo Foothill, Inc. will be paid in full;

• Senior secured noteholders will exchange their notes and claims for a new credit facility of $62.5 million and cash payments;

• Senior subordinated noteholders will receive five-year warrants to purchase equity interests in reorganized Black Gaming in exchange for their notes and claims;

• To the extent permitted under the bankruptcy code, general unsecured creditors, including vendors, will be paid in cash;

• Holders of existing equity interests will receive no distribution; and

• Anthony Toti, Newport Global Advisors or one of its affiliates, Black and one or more parties to be designated by Michael Gaughan will contribute cash in excess of $18.25 million in exchange for 100% of the new equity interests in reorganized Black Gaming.

Black Gaming, a Mesquite, Nev., casino operator, filed for bankruptcy on March 1. Its Chapter 11 case number is 10-13301.

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