N.J. Admin. Code § 13:69C-4.3 - Material debt transactions and continuing assessment of financial condition

(a) No casino licensee shall consummate a material debt transaction without the prior approval of the Division. Any transaction not specified in this subsection shall require prior Division review and approval with regard to the financial stability standards set forth in N.J.S.A. 5:12-84.a. The following types of transactions shall not require prior Division review and approval with regard to the financial stability standards:

1. An agreement that provides for any borrowing for capital and maintenance expenditures in Atlantic City;

2. An agreement that is for a refinancing of existing debt that includes a borrowing for capital and maintenance expenditures in Atlantic City of at least $ 50 million;

3. An agreement that provides for any borrowing that does not result in an increase in annual debt service requirements;

4. An agreement that reflects a licensee's pro rata share of debt maintained at an affiliate, intermediary, or holding company; or

5. An agreement entered with a bank, licensed lending institution, or institutional investor as defined by N.J.S.A. 5:12-85.1 with regard to debtor-in-possession financing approved pursuant to a bankruptcy court proceeding.

(b) In the event that a casino licensee contemplates consummation of a debt transaction or amendment thereto that does not require prior Division review and approval under subsection (a) above, the casino licensee nevertheless shall notify the Division in writing, not less than 10 days prior to entering an arrangement, of a transaction subject to one of the above exceptions. The notice shall, at a minimum, include the reasons the debt transaction is an allowable exception and all relevant calculations relating to the debt transaction.

(c) In reviewing any transaction pursuant to (a) and (b) above, the Division shall consider whether the transaction would deprive the casino licensee of financial stability, as defined by N.J.S.A. 5:12-84a, taking into account the financial condition of any affiliates of holding companies thereof, and the potential impact of any default on the licensee.

(d) Any subsequent use of the proceeds of a transaction previously approved by the Division pursuant to (a) and (b) above, including subsequent drawings under previously approved borrowings, shall not require further Division approval.

(e) The Division may restrict or prohibit the transfer of cash to, or the assumption of liabilities on behalf of, an affiliate if, in the judgment of the Division, such transfer or assumption would deprive the casino licensee of financial stability as defined by N.J.S.A. 5:12-84a.

(f) Any amendments or changes to a material debt transaction previously approved pursuant to (a) and (b) above must be filed with the Division at least 10 business days prior to executing such amendment or change. A supplemental submission should be filed detailing the impact of each proposed amendment or change and, where applicable, the overall impact of the proposed amendments or changes on debt balances, maturity dates, annual debt service requirements, and debt covenants. If the changes are deemed material, the licensee may not consummate the change or amendment without further Division approval.

Notes

N.J. Admin. Code § 13:69C-4.3

Amended by 50 N.J.R. 599(a), effective 1/16/2018