Organization - Restructuring Expenses (Tables)

6 Months Ended

Jun. 30, 2016

Accrued Restructuring and Support Expenses

We are also party to the Fifth Amended and Restated Restructuring Support and Forbearance Agreement dated October 7, 2015, with certain parties holding claims under CEOC’s first lien notes (the “First Lien Bond RSA”) that includes terms different than those included in the Amended Plan and the RSAs listed above, but has not yet been amended or terminated. However, our accruals with respect to such claims have been adjusted based on the more current terms in the Amended Plan, which exceed the amounts contemplated by the First Lien Bond RSA. Additionally, although a majority of the parties holding claims under CEOC second lien notes have not yet agreed to the terms contemplated in the Second Lien Note RSA, we have accrued such amounts, as appropriate, as they exceed the amounts contemplated by the Amended Plan, and our accrual represents our best estimate of our obligations.

Accrued Restructuring and Support Expenses

					Accrued as of
(Dollars in millions)	Initial Plan Terms		Amended Plan		June 30, 2016		December 31, 2015
Cash to Debtors and forbearance fees (“Fixed Payments”) in connection with the Restructuring⁽¹⁾	$	406	$	406	$	320	$	320
Contingent payment to CEOC if there is insufficient liquidity at the Effective Date⁽²⁾	75		—		—		—
“Additional Consideration” for the period from February 1, 2016 through the Effective Datefor the benefit of the First Lien Noteholders ⁽²⁾	$25 per month		—		—		162
“Upfront Payments” to certain First Lien Bank Lenders ⁽³⁾	63		63		2		2
“Bank Guaranty Settlement” to purchase from the Settling First Lien Bank Lenders 100% of their respective First Lien Bank Obligations that survive the Effective Date ⁽⁴⁾	460		579		579		386
Issuance of CEC convertible notes for the settlement of litigation claims and potential claims against CEC ⁽⁵⁾	—		1,000		1,060		—
Issuance of CEC common shares for the settlement of litigation claims and potential claims against CEC ⁽⁶⁾	—		—		1,167		—
Professional fees for subsidiary guaranteed note lenders	—		2		2		—
Consideration for general unsecured claims	—		5		5		—
Total accrued					$	3,135	$	870

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⁽¹⁾	$86 million was paid in fourth quarter of 2015.


⁽²⁾	This provision is included in the First Lien Bond RSA, but has been omitted from the Amended Plan and the other RSAs.


⁽³⁾	$61 million was paid in fourth quarter of 2015.


⁽⁴⁾	Amount payable is subject to the excess cash projected to be held by CEOC on the Effective Date.

⁽⁵⁾

Accrual represents the estimated fair value of the $1.0 billion in face value of convertible notes CEC expects to issue as part of the Amended Plan. The convertible notes mature within seven years of issuance, prior to which they can be converted to a number of shares equal to 12.195% of CEC’s fully diluted outstanding shares as of the Effective Date (subject to limitation). See Note 7 for additional information on fair value measurements.


⁽⁶⁾	Accrual represents the estimated fair value of the portion of CEC common shares expected to be issued as part of the Amended Plan for the settlement of claims. This fair value does not include the value of CEC common shares expected to be issued in exchange for OpCo preferred stock, described below. See Note 7 for additional information on fair value measurements.

Cash and Available Revolver Capacity

Cash and Available Revolver Capacity

	June 30, 2016
(In millions)	CERP			CES		CGP		Other
Cash and cash equivalents	$	191		$	104	$	1,029	$	201
Revolver capacity	270			—		160		—
Revolver capacity drawn or committed to letters of credit	(15		)	—		—		—
Total	$	446		$	104	$	1,189	$	201

Caesars Entertainment Operating Company [Member]

Other Commitments [Line Items]

Other Commitments Under the Amended Plan

The following represents other commitments or potential obligations that CEC has agreed to as part of the Amended Plan and certain of the RSAs, none of which have been accrued as of June 30, 2016.

Purchase 100% of OpCo common stock for $700 million ⁽¹⁾

Issuance of CEC common shares in exchange for OpCo preferred stock

Purchase 5% of PropCo equity for $91 million⁽²⁾

PropCo has right of first refusal on all new domestic non-Las Vegas gaming facility opportunities, with CEC or OpCo leasing such properties

PropCo receives a call right to purchase listed properties: Harrah’s Atlantic City, Harrah’s Laughlin, and Harrah’s New Orleans (subject to the terms of the CERP and CGPH credit agreements)

Guarantee of OpCo’s payment obligations to PropCo under the leases of the CEOC Properties

Guarantee of OpCo debt received by the First Lien Bank Lenders and First Lien Noteholders

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⁽¹⁾	“OpCo” refers to the proposed entity resulting from the Restructuring that will operate the CEOC Properties under a lease with PropCo. “CEOC Properties” refers to those properties owned by CEOC as of the Petition Date.


⁽²⁾	“PropCo” refers to the proposed entity resulting from the Restructuring that will own the CEOC Properties as of the Effective Date. This commitment is dependent on the ultimate legal structure of the entities formed as part of the Restructuring.