News Column

Affinity Gaming Reaches Settlement Agreement with Shareholders and Announces Amendment to Credit Agreement

July 28, 2014

LAS VEGAS--(BUSINESS WIRE)-- Affinity Gaming (“Affinity” or the “Company”), a diversified casino gaming company, today announced a Settlement Agreement (“Agreement”) to dismiss pending shareholder litigation and reconstitute its Board of Directors. The Agreement is supported by a supermajority of the Company’s shareholders, including Z Capital Partners (“Z Capital”, a 33.7% shareholder), Silver Point Capital (“Silver Point”, a 25.1% shareholder) and other large shareholders with approximately 24% ownership. Under the terms of the agreement, the Affinity Board will comprise a total of seven directors, consisting of the Company’s chief executive officer, two directors appointed by Z Capital, and four directors, including two independent directors, designated by Silver Point and other signatory shareholders.

The Agreement resolves Z Capital’s dispute with the Company and previous Board members concerning corporate governance and the implementation of a “poison pill” while providing for the direct involvement of the Company’s largest shareholders in setting its strategic direction.

The Company also announced today an amendment to the Credit Agreement for its Senior Secured Term Loan Facility. This amendment modifies certain financial covenants, provides additional operating flexibility for the Company and received the full support of requisite lenders in the facility.

“We are pleased to have reached this agreement with our fellow Affinity shareholders and to see the litigation resolved,” said James J. Zenni, President and Chief Executive Officer of Z Capital. “We believe this mutually agreeable decision is in the best interests of Affinity and all stakeholders, as the Company’s two largest shareholders are now actively involved with the Board. The additional support of the Company’s lenders and bondholders underscores the Company’s ongoing positive development and we remain committed to building off this momentum by working constructively with our fellow shareholders and management. We are looking forward to Affinity’s bright future.”

“The resolution of the litigation and the increased direct involvement of the Company’s largest shareholders will allow Affinity to focus on growth and value creation,” said Rich Parisi, Chairman of Affinity and Senior Analyst with Silver Point. “In addition, we are pleased to have completed the amendment to the Company’s Credit Agreement, which reflects Affinity’s large cash balance and strong financial positioning.”

About Affinity Gaming

Affinity Gaming is a diversified casino gaming company headquartered in Las Vegas, Nevada. The Company’s casino operations consist of eleven casinos, five of which are located in Nevada, three in Colorado, two in Missouri and one in Iowa. Additionally, Affinity Gaming provides consulting services under an agreement to support the operations of the Rampart Casino at the JW Marriott Resort in Las Vegas. For more information about Affinity Gaming, please visit its website: www.affinitygaming.com.

About Z Capital Partners

Z Capital Partners, L.L.C. is a leading private equity firm with approximately $1.7 billion of regulatory assets and committed capital under management and with offices in Lake Forest, IL and New York, NY. Z Capital pursues an opportunistic, value-oriented approach in private equity that includes making control investments in middle-market companies that may require growth capital, turnaround, restructuring or other special situations.

Z Capital portfolio companies currently have aggregate worldwide annual revenues of approximately $1.5 billion, sell products in over 30 countries, and have in excess of 190,000 associates directly and through joint ventures.

Z Capital's investors include prominent global sovereign wealth funds, endowments, pension funds, insurance companies, foundations, family offices, wealth management firms and other financial institutions in North America, Europe, Asia, Africa and the Middle East. For more information, please visit http://www.zcap.net/.

About Silver Point Capital

Silver Point Capital is a private investment firm focused on credit and special situations investing. The firm, which manages approximately $8.5 billion, was founded in 2002 by Edward A. MulÉ and Robert J. O’Shea.




For Affinity:

ICR

Dan Foley, 203-682-8312

dan.foley@icrinc.com

or

For Silver Point Capital:

Kekst and Company

Todd Fogarty, 212-521-4854

todd-fogarty@kekst.com

or

For Z Capital:

Joele Frank, Wilkinson Brimmer Katcher

Jonathan Keehner / Casey Landau, 212-355-4449


Source: Affinity Gaming


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Source: Business Wire


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