Business Context and Reporting Period
Twin River Worldwide Holdings, Inc. (now known as Bally’s Corporation) filed this Form 8-K on May 13, 2019, reporting transactions entered into on May 10, 2019. The filing concerns new senior notes and senior secured credit facilities; it does not report operating results for a specific quarter or year.
Key Financial and Financing Metrics
- Senior notes: $400 million aggregate principal amount of 6.750% Senior Notes due June 1, 2027.
- Interest: Cash interest payable semi-annually on June 1 and December 1, beginning December 1, 2019.
- Term loan: $300 million senior secured Term B Loan Facility maturing in 2026.
- Revolving facility: $250 million senior secured revolving credit facility maturing in 2024; it was undrawn at closing.
- Total credit commitment: Up to $550 million under the Senior Secured Credit Facilities, before considering permitted incremental facilities.
- Interest on credit facilities: Based on either LIBOR or a base rate, plus an applicable margin. LIBOR borrowings were subject to a 0.00% floor.
- Revolving commitment fee: 0.5% per quarter, potentially subject to step-downs based on total net leverage.
- Operating metrics, revenue, profit, cash flow, margins and liquidity balances: The filing text does not provide clear values.
Material Changes Versus the Prior Comparable Period
The filing does not present comparative operating or financial results. The material change disclosed is the creation of $400 million of senior unsecured notes and $300 million of senior secured term debt, together with access to a $250 million revolving facility that was undrawn at closing.
Terms, Outlook and Risks
- The senior notes may generally be redeemed before June 1, 2022 at a make-whole price. Up to 40% of the original principal amount may be redeemed with qualifying equity-offering proceeds at 106.750% of principal, plus accrued interest.
- The notes and credit facilities contain covenants restricting additional debt, dividends and other restricted payments, investments, asset sales, affiliate transactions and liens, subject to negotiated exceptions.
- The revolving facility includes a maximum total net leverage covenant that applies when borrowings exceed 30% of total revolving commitments.
- The credit facilities are guaranteed by certain domestic restricted subsidiaries and secured by first-priority liens on substantially all relevant assets, subject to exceptions.
- Specified asset sales and changes of control may require the company to offer to repurchase the notes, generally at par for qualifying asset sales and 101% of principal for a change of control.
- The notes are subject to disposition and redemption requirements imposed by applicable gaming regulators.
- Events of default include payment failures, covenant breaches, certain cross-defaults, bankruptcy or insolvency and certain unpaid judgments. Acceleration may occur upon specified events.
- The filing provides no management guidance or operating outlook.
Important Facts for Investors to Verify
- Confirm the company’s current legal name and any subsequent refinancing, repayment or amendment of the 2019 debt instruments.
- Review the complete Indenture and Credit Agreement for interest margins, covenant baskets, collateral provisions and mandatory repayment terms.
- Verify actual debt outstanding, cash balances, revolver availability and net leverage in subsequent periodic filings.
- Assess the effect of the new debt on interest expense, refinancing risk and compliance with leverage covenants.
- Review gaming-regulatory requirements that could affect ownership, redemption or disposition of the notes.