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EXHIBIT 99.1
Friday August 11, 9:02 am Eastern Time
Press Release
Lakes Gaming Announces Possible New Business Ventures
MINNEAPOLIS--(BUSINESS WIRE)--Aug. 11, 2000--Lakes Gaming, Inc. (Nasdaq:LACO -
news) announced today that it is actively negotiating agreements with
prospective partners that would result in two new business ventures.
One potential area of new business that Lakes is actively exploring involves the
life settlement industry. Lakes has currently agreed to provide up to $3,000,000
in bridge loans to a participant in the industry. Lakes has also agreed in
principle to form a wholly-owned subsidiary for the purpose of making a $22.5
million subordinated term loan to the same company. A portion of the term loan
is convertible at Lakes' option into a majority ownership interest in the
borrower. Lakes' commitment to proceed with the term loan is subject to the
borrower's securing a $150 million revolving warehouse credit facility to enable
the borrower to purchase and then securitize pools of life settlements. The
borrower will use the Lakes' loan proceeds as equity support for the warehouse
facility. The proceeds of the warehouse facility will be used to purchase
existing life insurance policies from persons 65 years or older. The life
settlement business through such a purchase provides liquidity to the holder of
the policy during his or her lifetime. The company that Lakes is planning to do
business with expects to receive a funding commitment from a warehouse lender in
the near future. This transaction is subject to negotiation and execution of
definitive documents, due diligence, regulatory approvals and other conditions.
Another business opportunity involves international internet gaming. Lakes is
considering establishing one or more web sites to conduct online gaming in a
regulated country, taking wagers placed from only outside the United States.
Lakes has identified an experienced provider of online gaming technology and is
negotiating a contract under which Lakes would license the provider's technology
for the new gaming web sites. The provider would create and maintain the gaming
web sites under a proposed two year service agreement. Any transaction is
subject to negotiation and execution of definitive documents, due diligence,
regulatory approvals and other conditions.
Lyle Berman, Chairman of the Board and Chief Executive Officer of Lakes stated,
"We are extremely excited about each of these new business opportunities. We see
the life settlement business as an opportunity for Lakes to become involved with
an industry outside of gaming that provides the means to a certain group of
individuals to liquidate their life insurance policies during their lifetimes.
This service allows the individuals to utilize their cash proceeds as they
choose. In keeping with our stated strategy of diversification, the life
settlement business affords an excellent opportunity for Lakes to accomplish
this step with limited risk. Regarding our potential involvement in internet
gaming, this business complements our existing expertise in casino gaming, new
game development and direct marketing to large consumer populations. While we
are extremely cautious in complying with all regulatory and license
requirements, we see internet gaming as an industry that will only continue to
grow and we would like to be part of that growth."
Lakes Gaming, Inc. is a publicly held casino management company that was formed
through a distribution to shareholders of Grand Casinos, Inc. effected in
December 1998. The company
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currently manages the largest casino resort in Louisiana and has entered into
development and management agreements with three separate American Indian tribes
for three new casino operations. Lakes Gaming, Inc. common shares are traded on
the Nasdaq National Market under the trading symbol "LACO".
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Certain information included in this press
release (as well as information included in oral statements or other written
statements made or to be made by the Company) contains statements that are
forward-looking, such as statements relating to plan for future expansion and
other business development activities as well as other capital spending,
financing sources and the effects of regulation (including gaming and tax
regulation) and competition. Such forward-looking information involves important
risks and uncertainties that could significantly affect anticipated results in
the future and, accordingly, such results may differ from those expressed in any
forward-looking statements made by or on behalf of the Company. These risks and
uncertainties include, but are not limited to, those relating to development and
construction activities, dependence on existing management, domestic or global
economic conditions, activities of competitors and the presence of new or
additional competition, fluctuations and changes in customer preferences and
attitudes, changes in federal or state tax laws of the administration of such
laws and changes in gaming laws or regulations (including the legalization of
gaming in certain jurisdictions). For more information, review the Company's
filings with the Securities and Exchange Commission.
Contact:
Lakes Gaming, Inc., Minneapolis
Timothy J. Cope
612-449-7030
