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Gaming Debt Deal Saves Odawa Casino Resort

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The Little Traverse Bay Band of Odawa Indians turned to a national law firm serving American Indian Tribes to manage the debt crisis engulfing its Odawa Casino Resort in northern Michigan, the casino recently announced.

The Petoskey-based resort, which opened in June 2007, replaced the original Victories Casino, according to the tribe’s Web site. Development in 2006 ran the tribe $122 million, financed by 10.25% Senior Notes due in 2014, Fredericks Peebles & Morgan LLP stated.

Performing below expectations, the casino struggled to service its debt, and in February 2009, payments were stopped, reported At that point, the tribe enlisted Fredericks Peebles & Morgan LLP to negotiate restructuring alternatives with note holders.

“We're obligated to pay, so we've come to an understanding to restructure a fair amount,” said LTBB-Odawa Tribal Chairman Ken Harrington to on Nov. 30, 2010, when the tribe completed its financial restructuring agreements with its bondholders.

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Under the new deal, the tribe will exchange the $143 million and accrued interest owed to bond holders for a $23 million cash payment and pay a lower interest rate of nine percent on $40 million, due in 2020, according to Fredericks Peebles.

"We said, 'Look, let's go to the table, we both took a gamble here, literally speaking, and you need to take just as big of a bite of the apple as we have, and it worked out,’" said Tribal Council Treasurer John Bott in