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PNK just put out an 8K regarding a credit amendment that they entered into on July 21, 2009.  They got an increase of the leverage ratio / decrease of the interest coverage ratio to account for a later opening of River City.  In return the facility size was reduced by 15%, the spread was increased by 50bps and a LIBOR floor of 1% was introduced

Below are the details of the Fourth Amendment to its Credit Facility:

Increased the maximum permitted Consolidated Leverage Ratio to take into account the opening of River City which was originally expected to open earlier.

The new maximum leverage ratios are as follows, for the period ended:

June 30, 2009 to 6.5x (was 6.0x)

Sept 30, 2009 to 6.5x (was 5.5x)

Dec 31, 2009 to 6.75x (was 5.5x)

March 31, 2010 to 6.5x (was 5.0x)

June 30, 2010 to 6.0x (was 5.0x)

Thereafter to 5.0x (was 5.0x)

  • Decreased the minimum Consolidated Interest Coverage for the March & June 2010 ended periods to 1.75x from 2.0x
  • Increased the applicable Margin on the R/C by 50 bps
  • Company was permitted to issue senior unsecured notes, subject to covenant compliance
  • Retained permission to request an extension of its Credit Facility beyond the Dec 10, 2010 maturity
  • Broadened the definition of “Defaulting Lender” to include any lender which fails to fund its portion of the Loan required under the Credit Agreement, as well as any Lender who becomes subject to bankruptcy or insolvency or takeover by a regulatory authority. By broadening this definition it makes it easier to assign a lender’s interests, rights and obligations (at par) under the Credit Agreement - I’ve never seen this one before – interesting in light of the bank environment
  • Definition of Base Rate was changed to include a one-month LIBOR floor of 1%
  • Each Lender’s commitment was reduced by 15% so that the Aggregate commitment was downsized to $531.25MM from $625MM