Inn of the Mountain Gods offers new notes, cash for 9¼% notes

New York, June 11 – Inn of the Mountain Gods Resort and Casino announced an exchange offer and consent solicitation in which it is offering new notes and cash for its 9¼% senior notes due 2020.

Holders who participate may choose either cash and new notes or new notes only, according to a T-3 filing with the Securities and Exchange Commission.

For the cash option, Inn of the Mountain Gods will pay $45 million, to be divided among holders who select this alternative, plus new notes for the remaining principal amount plus cash for accrued interest up to but excluding the settlement date on the existing notes.

In the notes option, Inn of the Mountain Gods will issue new notes equal to the sum of the principal amount of notes tendered plus accrued interest up to but excluding the settlement date.

The new notes will pay interest at 9¼% and mature on Nov. 30, 2020.

Interest may be paid in kind, at the issuer’s option, if the interim fixed charge coverage ratio is below 1 to 1.

The new notes will be callable at par and have a mandatory excess cash repayment provision.

The issuer is also soliciting consents to amend the indenture and security agreement for the existing notes to eliminate substantially all of the restrictive covenants and certain events of default and related provisions, eliminate certain covenants and provisions and make the lien on the collateral securing the existing notes junior to the liens on the collateral securing a planned new credit agreement and the new notes.

Concurrently with the completion of the exchange, the company will enter into a $40 million loan agreement and the Apache Tribe of the Mescalero Reservation will contribute $5 million in cash. These funds will be used to pay the cash portion of the consideration.

The new loan carries interest at Libor plus 400 basis points and matures on Nov. 30, 2020.

The exchange is conditional on at least 90% of the existing notes being tendered, completion of the other transactions and other conditions.

Inn of the Mountain Gods has entered into a support agreement with holders of 90.16% of the existing notes under which those holders will tender their notes, choosing the cash and notes option, and consent to the amendments.

The exchange ends at 11:59 p.m. ET on July 6.

No guaranteed deliveries will be accepted.

Settlement will follow promptly after the expiration.

There are currently $153,024,000 of the existing notes outstanding, of which $1,821,000 is held by the issuer and will be retired and canceled prior to the settlement date.

D.F. King & Co., Inc. (212 269-5550, 800 330-5897 or imgrc@dfking.com) is exchange agent, information agent and tabulation agent.

Inn of the Mountain Gods is a Mescalero, N.M.-based resort and casino owned by the Mescalero Apache tribe.

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