River Rock Casino on Monday said most of its bondholders have approved an offer from the Geyserville casino to refinance $200 million in debt at a lower interest rate.
The casino, which is owned by the Dry Creek tribe of Pomo Indians, defaulted on the bonds last month. The senior notes, which were sold in 2003 and paid 9.75 percent interest, came due Nov. 1.
A majority of investors agreed not to pursue foreclosure while River Rock restructures the debt. River Rock later offered to exchange the old notes for new ones paying 9 percent interest, or a tax-exempt series with 7.5 percent interest.
On Monday, River Rock said it has decided to increase interest on the tax-exempt notes to 8 percent. The new notes will mature in 2018.
The casino's exchange offer was contingent on agreement from two-thirds of bondholders. River Rock said Monday that bondholders representing $184 million in debt — more than 92 percent — have agreed to the deal.
The offer also includes an incentive payment tied to the amount of cash on its balance sheet. The deal is expected to be finalized later this month.
Most of the casino notes are held by institutional investors, including high-yield bond funds, union pension plans, insurance companies and nonprofits.
The tribal gaming business last month reported $31.3 million in sales for the quarter ended Sept. 30, up nearly 4 percent from the same period a year ago.
River Rock has about 600 employees, more than 1,200 slot machines and about 20 gaming tables. It generated $124 million in sales last year.
The casino is located on the tribe's 93-acre reservation off Highway 128. It remains open while River Rock restructures its finances.