Sands Regent sells stock
April 5, 2004
The Sands Regent of Reno said it completed a private placement of stock, and used the proceeds to refinance a $4.2 million subordinated note related to its 2002 acquisition of Gold Ranch Casino and RV Resort in Verdi.
In the private placement, the company issued 500,000 shares of its common stock for $5.22 per share.
The Sands Regent also issued to the investor a secured convertible promissory note for $1.6 million.
The note, which will bear interest at a fixed rate of 7.5 percent, will be convertible to the company’s common stock at $6.52 per share.
Conversion of the note could result in an additional issuance of up to 246,012 shares.
In addition, the investor received a warrant to purchase up to 100,000 shares of The Sands Regent common stock at $7.82 a share.
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According to The Sands Regent management, the transaction will reduce the company’s interest expense and debt service requirements.
The deal also helps facilitate the planned acquisition of Rail City Casino.
Pending regulatory approval and other customary closing conditions, the Rail City acquisition is expected to close in early May.
The Sands Regent owns a downtown Reno hotel-casino along with Gold Ranch.