Majestic Star Casino files reorganization plan, disclosure statement

By Caroline Salls

Pittsburgh, Sept. 20 - Majestic Star Casino, LLC filed its plan of reorganization and related disclosure statement Friday with the U.S. Bankruptcy Court for the District of Delaware.

According to the disclosure statement, cash distributions will be funded by the company's cash balances and/or cash from business operations.

Under the plan:

• The Majestic Star debtors will retain and reorganize around their casino gaming properties in Gary, Ind., Tunica, Miss., and Black Hawk, Colo., subject, in the case of the Black Hawk, Colorado gaming property, to obtaining all governmental licenses, suitability determinations and other required approvals within 240 days following the plan confirmation date;

• Holders of senior secured credit facility claims will receive a share of a new senior secured credit facility paydown amount and a new three-year $58 million senior secured credit facility.

Interest on the new facility will be Libor plus 475 basis points;

• Holders of senior secured notes indenture claims will receive a share of new five-year 12½% senior secured notes and 95% of new membership interests;

• Holders of senior notes indenture claims will receive a share of 35% of the membership interests; and

• Holders of discount notes indenture claims and equity interests will receive no distribution.

The plan confirmation hearing is scheduled for Dec. 16.

Majestic Star, a Las Vegas-based owner and operator of casino hotels, filed for bankruptcy on Nov. 23, 2009. Its Chapter 11 case number is 09-14136.

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