SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 14, 1995
FLORIDA GAMING CORPORATION
(Exact name of registrant as specified in charter)
Delaware 0-9099 59-1670533
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
1750 South Kings Highway
Fort Pierce, Florida 34945-3099
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (407) 464-7500
(Former name or former address,
if changed since last report.)
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
As reported in the press release issued August 17, 1995
(attached as Exhibit 99.1), Florida Gaming Corporation (the
"Registrant") announced that it had entered into an agreement in
principle (the "Agreement"), dated August 11, 1995, with
EagleVisions Gaming Group of the Americas, Inc. ("EagleVisions")
and Leonard L. Prescott, Bernard H. Lange, Peter A. Riverso, and
F. William Johnson (the "Shareholders"), to acquire 100% of the stock
of EagleVisions. Under the Agreement, the Registrant will exchange
100,000 shares of its common stock for 100% of the outstanding shares
of EagleVisions. The shareholders may also receive up to 50,000 shares
of the Registrant's common stock upon the signing and approval of
certain management contracts with Native American tribes.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
Exhibit 10.1 -- Agreement in Principle dated August 11,
1995, among Florida Gaming Corporation, EagleVisions
Gaming Group of the Americas, Inc.
Exhibit 99.1 -- Press Release dated August 17, 1995.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
FLORIDA GAMING CORPORATION
By /s/ Timothy L. Hensley
Timothy L. Hensley
Executive Vice President, Treasurer
and Chief Financial Officer
Date: August 18, 1995
FLORIDA
GAMING
CORPORATION
August 11, 1995
Mr. Leonard L. Prescott
Chairman, CEO and President
EagleVisions Gaming Group of the Americas, Inc.
700 Baker Building
706 S. Second Avenue
Minneapolis, MN 55402
Re: Agreement in Principle
Dear Mr. Prescott:
Based on the information that you have provided us concerning
EagleVisions Gaming Group of the Americas, Inc. ("EagleVisions"),
and our discussions with you, this letter sets forth in the form of
an agreement in principle the terms of a transaction pursuant to
which EagleVisions will affiliate with Florida Gaming Corporation
("FGC") through an acquisition of all of the outstanding shares of
EagleVisions by FGC.
1. Purpose. The transaction is intended to create a strategic
alliance that (a) provides a source of financial support for
EagleVisions' plans to assist Native American communities in
developing gaming, hospitality and entertainment resources that
will provide for the future of their tribes; and (b) brings to FGC
the experience and expertise of the Principals of EagleVisions in
developing and managing hospitality, entertainment and gaming
ventures with and for the benefit of Native American communities.
2. Exchange of Shares. Subject to the completion of a definitive
acquisition agreement (the "Agreement"), FGC will issue a total of
100,000 shares of its common stock, par value $.10 per share ("FGC
Shares"), to the shareholders of EagleVisions in exchange for all
of the issued and outstanding shares of EagleVisions' common stock
(the "Exchange"). As a result of the Exchange, EagleVisions will
become a wholly owned subsidiary of FGC. FGC Shares to be issued
to EagleVisions shareholders will be adjusted for any stock
dividend, stock split, reverse stock split, or other
recapitalization of FGC that occurs before the Exchange is
completed. The current trading price for FGC Shares is
approximately $8.50 per share. FGC will work with your tax
advisors in an effort to structure the Exchange in a tax
advantageous manner for FGC and you.
3. Employment or Consulting Agreements. At the closing of the
Exchange, as provided in its Agreement, FGC and EagleVisions will
enter into individual Employment or Consulting Agreements with each
of the Principals of EagleVisions who have joined in this Agreement
in Principle (the "Principals"). The Principals will provide their
services with respect to any and all Native American development
ventures exclusively to EagleVisions. The Individual employment
agreements will incorporate basic provisions as outlined in Exhibit
A, will include a severance provision, and will be guaranteed by
FGC.
a. Stock Grants. The Consulting or Employment Agreements
shall provide for the grant to the Principals together of up to
a total of 50,000 FGC Shares, which shall be issued upon the
occurrence of the events and in the amounts set forth below. The
events entitling the Principals to stock grants will not include
events relating to gaming operations originated by the Cavelle
Group, Inc. and Centrum X Corporation.
i. 50,000 FGC Shares to be granted one year from the
date of the last to occur of the following: (a) the
signing of a management agreement providing for the
development and operation of a Class III Gaming
Facility with a federally recognized tribe, (b)
approval of a compact between the tribe and state
in which the tribe intends to operate the Class III
Gaming Facility; and (c) approval of the management
agreement and any related agreements by the
National Indian Gaming Commission ("NIGC"); and/or
ii. 25,000 FGC Shares to be granted one year from the
date of the last to occur of the following: (a) the
signing of a management agreement providing for the
development and operation of a Class II Gaming
Facility with a federally recognized tribe, and
(b) approval of the management agreement and any
related agreements by the NIGC. FGC Shares will be
granted upon the signing of management agreements
for Class II Gaming with up to two tribes.
b. Grant of Options. Each Consulting or Employment
Agreement will provide for the grant of options to purchase FGC
Shares upon the following terms and conditions:
i. Upon the execution of the Agreement:
(a) Options granted to purchase a total of 150,000
FGC Shares to the EagleVisions Principals,
adjusted for stock dividends or splits.
(b) Exercise price: $7.50 per share.
(c) Expiration of options: 5 years from the date
of grant.
(d) Vesting: Options will become exercisable for
a total of 30,000 FGC Shares every year on the
anniversary of the date of grant.
(e) Acceleration of vesting: Options will become
exercisable for 50,000 FGC Shares on the date
any EagleVisions/FGC project opens its first
Class II gaming operation in a permanent
facility. Options will become exercisable for
100,000 FGC Shares on the date any
EagleVisions/FGC project opens its first Class
III gaming operation in a permanent facility.
ii. For five years from the date of the grant of the
initial Options:
(a) Option to purchase 25,000 FGC Shares, adjusted
for stock dividends or splits, to be granted
to the Principals upon the opening of each
EagleVisions/FGC gaming operation, except for
gaming operations originated by the Cavelle
Group, Inc. and Centrum X Corporation.
(b) Exercise price: $7.50 per share.
(c) Expiration of options: 5 years from the date
of grant.
(d) Vesting: Fully exercisable upon grant.
c. Term of Employment Agreements. The initial employment
contracts shall be for a term of one year, extending automatically
for one year from the annual anniversary date of the contracts
upon approval of the annual business plan and operating budget by
the FGC and EagleVisions Boards. Changes in compensation and
benefits shall be made as reflected in the approved business plan
and budget and shall be annually incorporated in an addendum to
the employment contracts. Each EagleVisions executive employee
will be entitled to the customary executive benefits as outlined
for FGC employees, plus additional benefits common to gaming
executives. If the annual business plan and budget are not
approved, the employment contracts shall terminate at the
conclusion of their current term, and the Principals shall be paid
their salary and benefits as provided until the contracts expire
plus agreed upon severance payments.
d. Other Terms. Mr. Prescott will become a member of the
FGC Board of Directors, President and Chief Operating Officer of
FGC, and will serve as Chairman and Chief Executive Officer of
EagleVisions. Up to two additional EagleVisions Principals will
be appointed as members of FGC Board of Directors.
4. Business Plan and Annual Budget. We contemplate that FGC will
provide financial support for EagleVisions based upon a mutually
agreeable operating budget setting forth expenses at a level
appropriate for the EagleVisions business plan.
a. The parties agree to cooperate in the preparation of an
operating budget to fund the EagleVisions' business plan.
b. The Agreement will include an agreed upon budget for
EagleVisions' initial year of operation. The business plan and
budget will be reviewed quarterly and updated annually thereafter.
FGC agrees to provide funding for EagleVisions' operations for the
first twelve months of operations in accordance with the budget.
FGC's obligation to provide financing for subsequent twelve-month
periods shall be subject to FGC's review and approval of
EagleVisions' progress and success and an updated business plan
and operating budget prior to each twelve month period.
c. FGC will provide financing to EagleVisions as
contemplated above in the form of loans at an interest rate equal
to the lesser of (i) the "prime rate" published in The Wall Street
Journal on the first day of each calendar quarter during the term
of the loan, plus 2%, or (ii) FGC's then current cost of borrowed
funds.
5. The Agreement. We contemplate that the definitive Agreement
for the Exchange will:
a. Provide for an appropriate level of review and evaluation
by FGC of EagleVisions' start-up assets, liabilities and
operations to confirm that there are no material, adverse aspects
of EagleVisions' affairs not reflected in its financial
statements. It will include an appropriate level of review and
evaluation by EagleVisions of the financial condition of FGC and
Freedom Financial Corporation.
b. Set forth appropriate and customary representations and
warranties by both EagleVisions and FGC with provision for
verification of those representations and warranties. These
representations and warranties will relate, among other things,
to the proper corporate organization of both corporations, the
proper issuance of the stock to be exchanged by EagleVisions and
FGC, the absence of liens on the stock being transferred to FGC
by the EagleVisions shareholders, the delivery by FGC of its
periodic reports and documents filed with United States Securities
and Exchange Commission to EagleVisions shareholders, compliance
with other requirements of federal and state securities laws, and
other appropriate warranties and representations. None of the
agreements in Section 7 preclude or limit the contemplated
Agreement with EagleVisions.
c. Establish as conditions of the closing, among other
things,
i. The accuracy and verification of representations
and warranties as of the date of the execution of
the Agreement and the closing.
ii. The receipt of customary certificates and current
financial statements.
iii. The absence of material adverse changes in the
affairs of either FGC or EagleVisions between the
execution of the Agreement and the closing.
d. Provide that FGC may appoint members to the EagleVisions
Board of Directors. The EagleVisions Board will
initially consist of five members, three of which will be
EagleVisions Principals.
e. Provide that if FGC transfers control of EagleVisions
through the sale of stock, the sale of assets, a merger
or a similar transaction valued at more than $25 million,
FGC agrees to pay the Principals compensation equal to 5%
of the net proceeds received by FGC in such transaction.
6. "Piggy Back" Registration Rights. During the two-year period
after each issuance of FGC Shares, whether issued in the Exchange,
upon the exercise of options or as stock grants, registration with
federal and state securities authorities will be required before
those FGC Shares can be sold in the public stock markets. The FGC
shares issuable to the EagleVisions shareholders in the Exchange
and as stock grants or upon the exercise of options granted in
connection with their employment and consulting arrangements will
have "piggy back" registration rights consistent with similar
rights of other FGC shareholders. Stockholders and option holders
will have the right to include their FGC Shares in any registration
of FGC Shares for sale by FGC or its shareholders in a public
offering, subject to conditions contained in any underwriting
arrangements with investment bankers engaged to market FGC shares
and stock market conditions generally.
7. Participation in Other Related Ventures. EagleVisions and its
Principals understand and acknowledge that FGC has entered into
arrangements providing for FGC's participation in other Native
American gaming and economic development projects with parties
other than EagleVisions. To the extent appropriate, the projects
will be coordinated with or pursued by EagleVisions on behalf of
FGC. These arrangements include:
a. A joint venture agreement with Centrum X Corporation,
whereby FGC has the right of first refusal to finance gaming and
business development projects with Native American tribes
identified by Centrum X for an 80% equity interest in the non-tribal
manager of such enterprises. Centrum X has completed a
management agreement with the Tonkawa Tribe of Oklahoma that is
available to FGC. The Tonkawa agreement has been submitted for
approval to the NIGC.
b. A 70% equity interest in a partnership to develop gaming
and business development projects with the Okevueha Band of
Seminole-Yamazee Indians, contingent upon the federal recognition
of such tribe.
c. An agreement with Casino America, Inc. pursuant to which
FGC has granted Casino America certain option rights and rights
of first refusal to finance and manage future Class III casino
gaming operations at FGC's current Fort Pierce, Florida jai alai
fronton, and at other non-Native American gaming enterprises of
FGC in Florida.
d. Negotiation of management agreements with the Ponca Tribe
of Nebraska, the Kiowa Tribe of Oklahoma, and the Crow Creek Sioux
of South Dakota for the development of gaming facilities and
related businesses on lands subject to tribal jurisdiction.
e. Negotiations to acquire the Cavelle Group, Inc. which has
a casino gaming management agreement with the Flandreau-Santee
Sioux Tribe of South Dakota.
f. Any and all gaming opportunities developed by
EagleVisions and/or any of its Principals are proprietary to
FGC/EagleVisions and property of FGC/EagleVisions unless disclosed
in Exhibit B and made a part hereof. Exhibit B must include any
signed agreements with tribes or other related parties.
8. Disclosure. EagleVisions has been negotiating with the Ponca
Tribe of Nebraska. The parties will endeavor to combine their
efforts to achieve an agreement with the Ponca Tribe.
9. No Shop. So long as we have an Agreement in Principle,
neither EagleVisions nor any of its directors or shareholders will
solicit, authorize the solicitation of, or enter into any
discussions with any third party concerning (a) a purchase of
EagleVisions stock, any option or warrant to purchase EagleVisions
stock or any securities convertible into EagleVisions stock, (b) a
tender or exchange offer for any EagleVisions stock, (c) a
purchase, lease or other acquisition of all or a substantial
portion of the assets of EagleVisions, (d) a merger, consolidation
or other combination with EagleVisions, or (e) any proposal for a
joint venture or other arrangement between EagleVisions and any
non-tribal party other than FGC, providing for joint participation
in economic and social development projects, including gaming, for
the benefit of Native American communities. This Section 8 is
intended to be the only binding obligation of the parties.
However, all parties hereto agree to negotiate in good faith
binding agreements among the parties based upon the terms and
conditions outlined in this Agreement in Principle.
10. Termination. The binding obligations of this Agreement-in-
Principle shall terminate if the parties do not enter into the
definitive Agreement on or before August 31, 1995, unless extended
in a writing executed by the parties.
11. Governing Law. The binding obligations of this
Agreement-in-Principle shall be governed by the laws of the State
of Florida.
Very truly yours,
FLORIDA GAMING CORPORATION
By /s/ W. Bennett Collett
W. Bennett Collett
Chairman and Chief Executive Officer
Agreed this 14th day of August, 1995.
EAGLEVISIONS GAMING GROUP
OF THE AMERICAS, INC.
By /s/ Leonard L. Prescott
Leonard L. Prescott
Chairman, Chief Executive Officer
and President
SHAREHOLDERS AND PRINCIPALS:
/s/ Leonard L. Prescott ______________________________
Leonard L. Prescott Peter A. Riverso
Date: 8-14-95 Date:__________________________
/s/ Bernard H. Lange /s/ F. William Johnson
Bernard H. Lange F. William Johnson
Date: 8-14-95 Date: 8-14-95
_________________________
Gary J. Gleisner
Date:____________________
EXHIBIT "A"
This document outlines the minimum or basic provisions to be
included in employment agreement to be drafted for EagleVisions
officers, which will be guaranteed by the parent company, Florida
Gaming Corporation (FGC). Chairman of the Board and Chief
Executive Officer for FGC, Bennett Collett, and/or the FGC Board of
Directors will structure each individual employment agreement, and
where appropriate consulting agreements will be structured. Other
benefits and perquisites normal to gaming officers and executive
officers will be included in the employment agreements depending on
the position of each individual.
Duties and Responsibilities: A summation of the job duties and
responsibilities will be included.
Basic Salary: The salary range for executive officers will be from
$150,000 to $225,000, and the salary range for executive or senior
vice presidents will be from $90,000 to $150,000. Where
appropriate base salaries may be split between EagleVisions and
FGC.
Incentive Pay: A bonus pool will be established and a system based
on defined goals and objectives will be put together to allow for
pay for performance. At no time will incentive pay exceed base pay
in any year.
Severance Pay: Depending on an officer's position in the company a
severance package will be structured that will include a minimum
severance payment of 6 to 18 month's of base salary.
Insurance Plans: Family plans for health, dental and optical
coverage will be structured. Disability and a base life insurance
plan based on a three times salary minimum formula will be
structured. Where appropriate additional keyman life plans will
also be structured.
Retirement Plans: Officers of EagleVisions will be included in
401K, profit sharing and other retirement plans of FGC, and any
similar plans formulated for a subsidiary such as EagleVisions.
Other Terms: Other perquisites appropriate to title and position
will be negotiated and structured.
Accepted
/s/ W. Bennett Collett /s/ Leonard L. Prescott
W. Bennett Collett Leonard L. Prescott
Chairman and CEO Chairman and CEO
Florida Gaming Corporation EagleVisions
FOR IMMEDIATE RELEASE
FLORIDA GAMING CORPORATION ANNOUNCES AGREEMENT IN PRINCIPLE TO
ACQUIRE NATIVE AMERICAN GAMING MANAGEMENT COMPANY
Ft. Pierce, FLA, August 17, 1995. -- Florida Gaming Corporation
(NASDAQ-Small Cap-"BETS") which owns and operates Jai-Alai and
Inter-Track Wagering (ITW) Pari-Mutuel facilities in Fort Pierce,
Florida announced today that it has signed an Agreement in
Principle to acquire 100% of the stock of EagleVisions Gaming Group
of the Americas, Inc. of Minneapolis, Minn.
Under the Agreement, Florida Gaming will exchange 100,000 shares of
it's common stock for 100% of the outstanding shares of
EagleVisions. The EagleVisions shareholders will also receive up
to 50,000 shares upon the signing and approvals of certain
management contracts with Native American Tribes. The senior
officers of EagleVisions will also receive options to purchase
150,000 shares of Florida Gaming exercisable over a five-year
period.
Mr. Leonard Prescott, Chairman and C.E.O. of EagleVisions, will
continue in that capacity and will also assume the duties of
President and Chief Operating Officer of Florida Gaming
Corporation.
Leonard Prescott, Mr. F. William Johnson and Mr. Bernard L. Lange,
director of EagleVisions, will also be appointed to the Florida
Gaming Board of Directors.
The Agreement in Principle which is subject to a definitive
agreement, final due diligence, and approval by the Florida Gaming
Board of Directors, is expected to be closed before October 1,
1995.
Mr. Collett stated, "this affiliation with EagleVision is a giant step
for the Florida Gaming shareholders. The principals of EagleVision
probably have more close relationships with Native American tribes than
any other gaming management company in North America. We are very pleased
and excited about the prospects of Florida Gaming's expansion into this
rapidly-growing segment of the gaming market".
Mr. Prescott and his management team started, built, and managed, for
twelve years (1982 to 1994), the second most profitable and the second
largest (second only to the Foxwoods Casino at Ledyard, Connecticut)
Native American casino and Entertainment Complex in the United States.
Mr. Prescott was Tribal Chairman of the Shakopee Mdewakanton Dakota tribe
and was Chairman and C.E.O. of the tribal company which manages the Mystic
Lake Entertainment Complex near Minneapolis, Minn. The Mystic Lake Casino
Complex has 375,000 square feet of space, 2,500 slot machines, 125 table
games, a large bingo hall, and other support facilities. No alcoholic
beverages are served.
Mystic Lake provides over 4,000 jobs with an annual payroll over $70
million. For the calendar year 1994 Mystic Lake produced a net profit
in excess of $96 million.
Mr. Prescott is an enrolled member of the Shakopee Mdewakanton Dakota
Community in Prior Lake, Minn. He served his tribe as a member of the
Tribal Council, as Tribal Chairman, and as Chairman of the Board and
Chief Executive Officer of Little Six, Inc. -- a tribally chartered
corporation that oversees and manages the tribe's business interests.
As tribal chairman, Mr. Prescott was instrumental in structuring Minnesota's
two Indian gaming compacts, and in arranging financing for the Mystic Lake
Casino project. He was one of the founding members of the National Indian
Gaming Association, and served two years as its chairman. Mr. Prescott
is identified as a national leader on Indian gaming and other Indian issues,
and is one of the country's most vocal advocates for the rights of tribes
to conduct gaming on their reservations.
Mr. Prescott was the first Native American inducted into the World Congress'
International Gaming Hall of Fame, and was the first Native American to
be named a member of the prestigious Minnesota Business Partnership. He
was also the first Native American to receive the American Jewish
Committee's Human Rights Medallion.
Mr. Prescott is a frequent speaker on Indian issues and has been featured
in several regional and national publications. He is recognized as a
strong Indian issues lobbyist by members of the United States Senate and
the U.S. House of Representatives.
Mr. Prescott stated, "I believe that with the success and experience of
Mystic Lake Casino behind EagleVisions and the financial strength of
Florida Gaming Corporation we cannot help but be successful. From
EagleVisions point of view, we will strive to put together a working
relationship that has a goal of developing and strengthening the economic
resources available to the Tribal groups involved. We believe in the
principles established in the Indian Gaming Regulatory Act and will
strive to negotiate the most favorable terms possible for the Indian
Tribes. Experience in the gaming industry and living within and
understanding the Tribal reservation political infra-structure is our
strength."
Contract:
W. Bennett Collett
Chairman
or
Timothy L. Hensley
Executive Vice President
(502)589-2000
(407)464-7500
