Montreign Casino Financing Deal Closes

Real Estate In-Depth | February 2017

A rendering of the Resorts World Catskills Casino

MONTICELLO, NY—Montreign Operating Company, LLC, a wholly-owned indirect subsidiary of Empire Resorts, Inc. recently announced the successful closing of its senior secured first lien term loan facility and senior secured revolving credit facility.

The financing provides an aggregate of $485 million senior secured first lien term loans, consisting of $70 million of Term A loan commitments and $415 million of Term B loan commitments, and a $15 million senior secured revolving credit facility. The Term A term loan and the revolving credit facility have a maturity date of Jan. 24, 2022 and the Term B term loan has a maturity date of Jan. 24, 2023.

The first lien term loans and the revolving credit facility are both floating rate facilities. Interest will accrue on outstanding borrowings under the Term A loan at a rate equal to LIBOR plus 5.0% per annum, or an alternate base rate plus 4.00% per annum. Interest will accrue on outstanding borrowings under the Term B loan at a rate equal to LIBOR (with a LIBOR floor of 1%) plus 8.25% per annum, or an alternate base rate plus 7.25% per annum. Interest will accrue on outstanding borrowings under the revolving credit facility at a rate equal to LIBOR plus 5.0% per annum, or an alternate base rate plus 4.0% per annum. Montreign will also pay a commitment fee, in an amount of 2.5% per annum from the closing date through March 24, 2018 and 5.0% per annum thereafter, to each Term A loan lender on the undrawn amount of each Term A lender’s Term A loan commitment.

The Term A loan may be borrowed during the period from the closing date to July 24, 2018, subject to certain conditions. The Term B loan was borrowed in full on the Closing Date. The proceeds of the Term B loan were used to pay fees and expenses related to the financing and fund various lender-controlled accounts. The proceeds in these lender-controlled accounts, which accounts will include proceeds of the Term A loan upon borrowing, will be used by Montreign and its subsidiaries to fund the costs relating to the development and construction of Montreign Resort Casino, as well as the entertainment village and the golf course, to be located at the Adelaar destination resort in Sullivan County. The proceeds of the revolving credit facility may be used for working capital needs, capital expenditures and other general corporate purposes.

Empire Resorts owns and operates, through its subsidiary Monticello Raceway Management, Inc., the Monticello Casino & Raceway, a harness racing track and casino located in Monticello.  As a result of the award of a gaming facility license from the New York State Gaming Commission, the company, through its indirect subsidiary Montreign Operating Company, LLC, is developing and constructing Montreign Resort Casino—an 18-story casino, hotel and entertainment complex with approximately 102 table games, 2,150 state of the art slot machines and 332 luxury rooms, which includes 12 penthouse suites, eight garden suites and seven two-story villas, designed to meet five-star and five-diamond standards.