Hooters Casino Hotel owner in bankruptcy after bondholder talks fail

By Caroline Salls

Pittsburgh, Aug. 2 - 155 East Tropicana LLC, owner of the Hooters Casino Hotel, will seek a financial restructuring of its current debt through a Chapter 11 bankruptcy filing made Monday in the U.S. Bankruptcy Court for the District of Nevada.

According to a news release, the company had been in extensive negotiations with its primary bondholder, which purchased roughly 98% of the company's debt at a substantial discount.

However, 155 East Tropicana said it no longer believes a pre-negotiated restructuring is possible, and it has therefore elected to begin the Chapter 11 process immediately.

All hotel and casino operations will continue to operate as usual during the Chapter 11 process.

"We regret that we have been unable to reach an acceptable settlement with our new bondholder," the company said in the release.

"We are confident that an orderly and transparent Chapter 11 process will provide the company with the opportunity to properly restructure its balance sheet and emerge as a stronger business, while also continuing to operate with no disruption to our customers, employees and vendors.

"Absent the significant debt payments we're currently obligated to pay, Hooters Casino Hotel is a profitable, successful business and we look forward to completing this process to return our entire focus to running our business and serving our guests."

In connection with the bankruptcy filing, the company has requested court approval to use the cash collateral of its pre-bankruptcy lender agent and 8¾% senior secured notes trustee to fund its operations while in bankruptcy.

The cash collateral use will be based on a 13-week budget.

According to court documents, 155 East Tropicana has $10 million to $50 million in assets and $100 million to $500 million of debt.

The company's largest unsecured creditor is trustee U.S. Bank, NA, with a $162.23 million claim.

The company is represented by Gordon & Silver Ltd.

155 East Tropicana owns the Hooters Casino Hotel in Las Vegas. The Chapter 11 case number is 11-22216.

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