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): December 22, 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
Not Applicable
(Former name or former address,
if changed since last report.)
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
On December 22, 1995, Florida Gaming Corporation (the
"Company") completed the placement of 2,400 shares of its newly
authorized Series B Preferred Stock ("Series B") to institutional
investors outside the United States. The purchase price for the
Series B was $1,000 per share, or a total purchase price of $2.4
million. The Company anticipates that the placement proceeds will
be used to finance certain contingent obligations of the Company in
connection with its Indian gaming ventures and/or improvements to
its Fort Pierce, Florida fronton and pari-mutuel wagering facility.
Holders of Series B do not have voting rights, except in
certain circumstances where such rights are mandated by law.
Series B shares are equal in rank to the Company's Class A
Preferred Stock with respect to payment of dividends and
distribution of assets upon liquidation of the Company. Holders of
Series B shares are entitled to receive an 8% annual cumulative
dividend payable in shares of the Company's Common Stock upon
conversion. Beginning February 1, 1996, each Series B share can be
converted into the number of shares of Common Stock equal to the
sum of $1,000 per Series B share plus 8% accrued and unpaid
dividends from the date of issuance through the date of conversion
divided by 80% of the average of the closing bid prices of the
Common Stock as reported by the Nasdaq SmallCap Market for the 5
consecutive business days immediately preceding the date of
conversion (the "Average Bid Price"). Assuming an Average Bid
Price of $10.50, the closing bid price for the Common Stock on
December 19, 1995, approximately 288,219 shares of Common Stock
would be issuable upon the conversion of Series B shares on
February 1, 1996. Upon a liquidation, dissolution or winding up of
the Company, holders of Series B shares are entitled to receive
$1,000 per Series B share plus the amount of accrued and unpaid
dividends from the date of issuance before any distribution is made
on any shares of Common Stock.
The Company anticipates that the proceeds of the placement may
be used to finance the Company's commitment to loan $5 million to
the Rincon, San Luiseno Band of Mission Indians, which presently
owns and operates the River Oaks Casino, located approximately 40
miles from the city of San Diego, California. The Company's
commitment is subject to the lifting of an injunction currently
prohibiting the operation of gaming machines at River Oaks. The
Company previous announced that it had entered into a loan
agreement with the Rincon Band on September 15, 1995.
Under the terms of the loan agreement, the Company has agreed
to loan up to $5,000,000 to the Rincon Band for working capital to
renovate, improve and expand the Tribe's gaming facilities. In
lieu of interest, the Company will be entitled to receive, during
the seven-year term of the Loan Agreement, 12.5% of the gross
receipts of the facility (excluding gaming machines), and 12-1/2%
of the "drop" or "handle" from gaming machines during the first
five years and 11% of the "drop" or "handle" during the sixth and
seventh years. The loan is secured by security interests granted
to the Company in the equipment, accounts, revenues and other
property of River Oaks other than land and real estate. As of
December 31, 1995, the Company had made short term working capital
advances of $323,000 to the Rincon Band, which will become
repayable under the terms of the loan agreement if and when the
loan agreement takes effect. The loan agreement can be terminated
by the Company if it does not take effect by June 30, 1996.
The preliminary injunction issued by the United States
District Court for Southern California was sought by the United
States Attorney for Southern California, based upon federal circuit
court decisions that the operation of gaming machines by Indian
tribes in California was prohibited by the Indian Gaming Regulatory
Act because gaming machines were prohibited by California law, and
to date California Governor Wilson has refused to enter into a
gaming compact with Indian tribes in California. The Rincon Band
has filed a motion to modify the injunction based on the Tribe's
belief that it now complies with all conditions for the operation
of gaming machines under IGRA.
Following a hearing on December 19, 1995, the court ordered
the parties and the three other Indian tribes operating gaming
machines in San Diego County to submit briefs by February 5, 1996,
addressing several questions relating to equities of the present
situation, in which only the Rincon Band is prohibited from
operating gaming machines at its tribal casino. There can be no
assurance that the injunction will be lifted. The lifting of the
injunction would place the Rincon Band in a position comparable to
the three other tribes in San Diego County and the 22 other tribes
in California that already operate gaming machines.
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 3 -- Certificate of Designations of Series B
Preferred Stock of Florida Gaming Corporation is incorporated by
reference to Exhibit 3.3 to Amendment No.1 to Form S-3 Registration
Statement (Reg. 33-99380) filed January 8, 1996.
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: January 17, 1996
