STATE OF MICHIGAN
MICHIGAN GAMING CONTROL BOARD

SPECIAL PUBLIC MEETING
Cadillac Place
3062 W. Grand Blvd., Suite L-700
Detroit, MI

Thursday, June 5, 2008
9:00 A.M.

MINUTES

On Thursday, June 5, 2008, the Michigan Gaming Control Board held a special public meeting at the Board office in the Cadillac Place, 2062 W. Grand Blvd., Suite L-700, Detroit, MI.

Present:                         In attendance were the following Board members:

                                                   Mr. Damian Kassab, Chairman
                                                   Judge Benjamin Friedman
                                                   Mr. Donald Robinson
                                                   Ms. Barbara Rom
                                                   Mr. Michael J. Watza

                                     Also attending were:

                                                   Richard Kalm
                                                   Tom Barker
                                                   John Page
                                                   Fred Cleland
                                                   Insp. Ellis Stafford
                                                   Jack Cahill
                                                   Laurie Lander

Business:

Board Chairman Damian Kassab called the special public meeting to order at 9:09 a.m.  Chairman Kassab noted for the record that all Board members were present. 

Chairman Kassab then asked Executive Director Richard Kalm to give a brief overview of the agenda for the special meeting.

Mr. Kalm advised the Board that on May 29, 2008, he was notified by Michael Dubay of Honigman, Miller & Schwartz, on behalf of Greektown Casino, of the impending Chapter 11 bankruptcy filing.  On May 30^th, a meeting was held with Board staff and representatives of Greektown Casino's management team and counsel, Merrill Lynch and Conway MacKenzie & Dunleavy (CMD) regarding the filing of Chapter 11.  Board staff was advised at this meeting that Greektown was requesting the Board's approval for interim financing.  Greektown was advised that a written request would need to be filed and a special Board meeting scheduled.  Subsequent to this meeting, there were additional filings in Federal Bankruptcy Court and an order was entered approving the interim financing agreement, pending the Board's approval of the new debt transaction.

Upon conclusion of Mr. Kalm's overview, Chairman Kassab noted for the record the presence of Mike Dubay, counsel for Greektown Casino and Charles Moore of Conway MacKenzie & Dunleavy, financial advisors to Greektown Casino.

After Mr. Moore's introduction, he proceeded to describe the proposed financing transaction that would require the Board's approval.  Mr. Moore explained that the proposed financing is a $150 million debtor in possession (DIP) facility made up of two tranches.  Tranche A is a $135 million delayed draw term loan facility, specifically for the construction costs for the completion of the permanent casino and hotel.  Tranche B is a $15 million revolver, which is available for use for both the construction costs, as well as operating costs.

Mr. Moore explained that as part of the financing motion made in federal court, there is an immediate payment item, which is a draw of approximately $51.3 million that would occur upon the Board's approval.  This draw would be used to pay past due construction costs.  He further explained that on or before June 29, 2008, a second draw for the remainder of the $150 million would be taken. 

Mr. Moore stated that there were several reporting mechanisms that were built into the credit agreement.  One of the reporting mechanisms was a budget, which consisted of an operating component and a construction component, which laid out the anticipated cash inflows and outflows for both components.  Mr. Moore further stated that the casino has to provide to the lenders a weekly variance report of the actual versus the budgeted cash flows.   There are also mandatory prepayment requirements.

Mr. Moore stated that all budgetary information/documents provided to the lenders would also be provided to Board staff.

Mr. Moore advised the Board that because of the immediate need for cash for construction costs, other financing avenues were explored.  However, the negotiations with EIG for sufficient funding had failed, which precipitated the filing of Chapter 11.   Mr. Moore further justified the bankruptcy filing by stating that additional financing, along with proceeds from EIG and deferred payments, was not an option due to the fact that Merrill Lynch would not provide additional funding because of the uncertainty of the EIG proposal.  Merrill Lynch was also reluctant to provide funding due to the Board's denial of the limited duration waiver.  Mr. Moore also stated that Merrill Lynch would, however, provide financing in the context with bankruptcy.  Bankruptcy would initiate an automatic stay, thereby releasing Greektown from paying interest on a coupon payment and the installment payment to Mr. Gatzaros.  The stay would also apply to the 2005 Board Order that would allow the Board to enforce the sale of the casino.

Mr. Moore also stated that it was fairly clear that the likelihood of achieving the 4½ times leverage ratio by December 21, 2008, was unlikely.  He further stated that by filing Chapter 11, additional funding was obtained and repayment would likely occur, which resulted in a leverage ratio of 5 or 5 ½.

Mr. Moore advised the Board that the primary goal of the casino was to complete the permanent casino and hotel complex.  He further stated that the expanded complex should be completed in January 2009 with the emergence from bankruptcy shortly thereafter.

Mr. Moore also explained that the primary plan that the casino will be following would be the completion of the expanded complex and a confirmed plan of reorganization.  However, the lenders requested that an alternative plan be set in place.  This alternative plan would be that the debtors have a sale procedure order in place by February 28^th, 2009.  Mr. Moore stated that while they pursued exit financing to complete their plan, they would also undertake the normal steps as it relates to a sale process.

Upon conclusion of Mr. Moore's summary and Board members' questions were answered, Mr. Kalm advised the Board that he was concerned with the withholding of information by Greektown Casino, its representatives and lenders.  He further advised that due to the withholding of information, certain conditions were set forth in the Board Order.

Next Mr. Charles Jaskolski of Wolinski & Company gave a summary of their conclusions of the forecasts as projected by CMD.

Upon completion of Mr. Jaskolski's summary and Board members' questions were answered, First Assistant Attorney General Don McGehee advised the Board that a provision in paragraph 28 of the DIP financing order that the bankruptcy court approved, reserves all rights to the MGCB and the $51.3 million DIP financing interim payment was subject to Board approval. 

As part of the public comment portion of the meeting, Chairman Kassab noted for the record the presence of Diana Knowles.  Ms. Knowles' comments related to the money that Greektown Casino was taking from the tribe to finance the casino. 

After Ms. Knowles comments, Mr. Kalm gave a brief overview of Resolution 2008-02, which requested the Board's authorization to hire outside counsel to represent the Board in the bankruptcy proceedings.

Before a motion was made, Ms. Rom asked that a change be made to section IV.b of the Interim Financing Board Order to include "Any written notice and all information . . ."  Therefore, it was moved by Ms. Rom and seconded by Mr. Watza that the Board adopt the proposed order granting in part and denying in part, a request for waiver of the Board's debt transaction rules, granting certain exemptions from the supplier licensing requirements and granting interim conditional approval of debt transaction as drafted and presented by the Board staff with changes noted by Ms. Rom in IV.b.  A roll call vote was taken.

                                                   Mr. Kassab:                      Aye
                                                   Judge Friedman:                Nay
                                                   Mr. Robinson:                    Aye
                                                   Ms. Rom:                          Aye
                                                   Mr. Watza:                        Aye

Motion carried.

Next it was moved by Mr. Watza and seconded by Mr. Robinson that the Board adopt Resolution 2008-02 authorizing the Attorney General to obtain outside counsel to assist with representing the Board in bankruptcy proceedings filed by Greektown Casino, L.L.C. and its entities.  A roll call vote was taken.

                                                   Mr. Kassab:                      Aye
                                                   Judge Friedman:                Aye
                                                   Mr. Robinson:                    Aye
                                                   Ms. Rom:                          Aye
                                                   Mr. Watza:                        Aye

Motion carried.

There being no other business to discuss, Chairman Kassab adjourned the meeting at 11:08 a.m.

____________________________________________________
Laurie Lander, Board Secretary