Wynn Resorts completes partial redemption of 12% notes

New York, June 22 - Wynn Resorts Ltd. (B3/CCC+) said it completed its redemption of a portion of the outstanding 12% second mortgage notes due 2010 of Wynn Resorts' subsidiaries, Wynn Las Vegas LLC and Wynn Las Vegas Capital Corp.

The company said it redeemed $122.42 million principal amount of the notes on June 14 out of the previously outstanding $370 million, funding the redemption with a portion of the roughly $267.9 million of net proceeds Wynn had realized when it completed its sale of 7 million shares of common stock on May 12.

Wynn said that the total amount of notes redeemed included $8.981 million held by certain directors, officers and affiliates of the company, out of the total $27.178 million that had been held by such parties before the redemption. It said that the notes that were redeemed were selected on the basis of the standard procedures of the Depository Trust Co.

Wynn Resorts, a Las Vegas-based gaming company, had announced on May 20 that it had notified the holders of the 12% notes of the company's intention to redeem $122.42 million of the notes, funding the redemption with a portion of the proceeds of its recent stock sale.

Wynn had sold $370 million face amount of the notes in October 2002. The notes - which are otherwise non-callable until November 2006 - carry a standard equity clawback indenture provision, allowing the company to redeem up to 35% of the face amount (or a maximum of $129.5 million) at a price of 112 for the first three years after issue, or until Oct. 30, 2005.

Wynn said that the notes would be redeemed on June 14 at 112% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest. It said the total price of the redemption transaction to the company would be $138.8651 million.

Wynn noted that certain directors, officers and affiliates of the company held $27.178 million of the notes. It said the notes to be redeemed would be selected on the basis of the standard procedures of the Depository Trust Co. The company said that following the redemption, it would disclose the amount of notes, if any, held by directors, officers or affiliates that were redeemed.

Wynn had said on May 7 that it would sell 7 million shares of its common stock and use some of the proceeds to redeem a portion of the outstanding 12% notes.

At the time it announced the stock sale, Wynn did not immediately outline a timeframe for the planned note redemption or state exactly how many of the notes it planned to redeem.

Wynn said it would sell the 7 million common shares via sole bookrunning manager Deutsche Bank Securities Inc. and co-managers J.P. Morgan Securities Inc., Banc of America Securities LLC and Bear Stearns & Co. Inc. It said the stock offer would have a greenshoe option allowing the underwriters to purchase up to an additional 1.05 million shares to cover over-allotments, if any.

Wynn said that the stock sale would close on May 12 and would be subject to customary conditions. It estimated that the net proceeds from the stock sale would be about $268.1 million, after deducting underwriting discounts and estimated offering expenses.

Wynn said that besides the planned redemption of some of the 12% notes, subject to Wynn obtaining necessary consents from the lenders under certain of its existing debt, the company also planned to use the remaining portion of the stock-sale proceeds to help finance the first casino resort to be developed in Macau, a Special Administrative Region of the People's Republic of China, by its subsidiary, Wynn Resorts (Macau) SA, and for general corporate purposes, including possibly financing potential acquisitions or other investments.

On May 12, Wynn announced the completion of the stock offering, at $38.75 per share. The net proceeds to Wynn Resorts, after deducting discounts and commissions and estimated expenses, were about $267.9 million.

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