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TO REOPEN TINIAN DYNASTY’S CASINO
HKE seeks court approval to obtain $5M loan
The owner of Tinian Dynasty Hotel & Casino is seeking authorization from U.S. District Court for the NMI’s Bankruptcy Court to obtain a $5-million loan from a lender, Chen Chien Yeh, in order to allow it to reopen the casino portion of the business.
Hong Kong Entertainment (Overseas) Investment Ltd. counsel Timothy H. Bellas said HKE believes that this funding to pay its liabilities and to fund its working capital needs in order to allow it to reopen the casino business.
In HKE’s motion, Bellas said without the post-petition financing requested, HKE has insufficient cash liquidity to achieve its reorganization under the Chapter 11 bankruptcy.
Bellas said HKE believes that the terms offered by lender Yeh are substantially more favorable than what HKE could expect from other lenders, since Yeh is not seeking a security interest or lien on HKE’s assets.
Asked by Saipan Tribune about Yeh’s background, Bellas said he met him once in another lawyer’s office and that he does not know much about him.
“He (Yeh) agreed to loan the corporation money in order to achieve its reorganization,” the lawyer said.
HKE president Chun Wai Chan recently filed Chapter 11 bankruptcy petition. He said the board agreed that it appears and essential to seek the protection of the bankruptcy court in order to have the opportunity to formulate a plan for the rehabilitation of the corporation through reorganization.
According to HKE’s bankruptcy petition, the corporation has total assets of $55.2 million, but its total liabilities is $273.5 million.
Last week, HKE asked the court’s permission to pay taxes and fees that may become due while the bankruptcy petition is pending.
HKE estimates it owes the Internal Revenue Service $315,989.69 in withholding taxes and the CNMI government $372,456.96 in taxes, for total tax liabilities of $688,443.65.
