SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
DECEMBER 29, 1998
Date of Report (Date of Earliest Event Reported)
2-96366-A
(Commission File Number)
TREASURE & EXHIBITS INTERNATIONAL, INC.
Florida 59-2483405
(State or Other Juris- (IRS Employer Iden-
diction of Incorporation) tification Number)
2300 Glades Road, Suite 450-West
Boca Raton, Florida 33431
(Address of Principal Executive Offices)
(561) 750-7200
(Registrant's Telephone Number)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Following its recent abandonment of the long proposed acquisition of
Michael's International Treasure Jewelry, Inc. due to the ultimate
determination that that company's operations were not readily auditable, the
Registrant entered into a lease purchase option for a casino cruise ship named
"The Royal Princess". The lease was effective December 1, 1998. The
Registrant is operating the 150 foot vessel off the coast of South Florida.
The ship can accommodate approximately 275 passengers and is operated by a
crew of 25. It contains a complete casino including black jack tables, slot
machines, crap tables and roulette and a full-service restaurant and bar. The
Registrant has renamed the ship the "Eldorado Casino".
On December 9, 1998, the Company entered into a Letter of Intent to
acquire the assets of American Consolidated Amusement, Inc. comprised of some
200 electronic gambling machines providing mechanized black jack, roulette and
slots. The assets acquired include the leasehold currently housing the gaming
machines in an adult gaming complex located on Collins Avenue in Sunny Isles
Beach, Florida. The leased space amounts to approximately 4,000 square feet
at a monthly rental of $6,000. The lease acquired in the transaction is for
an initial term of five (5) years and provides for two additional sequential
five (5) year renewal terms. Acquisition of the assets of American
Consolidated Amusement also includes all of the leasehold improvements made by
the seller in the leased space.
The Registrant closed the transaction in late December by payment of the
full purchase price, comprised of 1,500,000 shares of its authorized but
previously unissued restricted Common Stock and the Company's assumption of
approximately $1,000,000 of the seller's existing debt to the Company's
affiliate, First Capital Services, Inc. The Registrant's President and
Director, Larry Schwartz, is also the Chief Executive Officer and a Director
of First Capital Services, Inc.
The Company views the assets purchased from American Consolidated
Amusements, Inc. as assets purchased for value amounting to approximately
$1,250,000 and considers the acquisition as a complement to the Company's
recent lease/purchase acquisition of the Eldorado Casino cruise ship.
In operation, patrons of the Company's gaming complex in Sunny Isles
purchase tokens for use in the gaming machines. The tokens are redeemable for
prize merchandise on the premises or, for a certificate good for additional
tokens on another occasion within the gaming complex or, good for redemption
in cash on the Eldorado Casino cruise ship when the ship is located
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sufficiently distant from the South Florida coastline to operate cash basis
gaming on board.
While there can be no assurance that the Company's operation of the
casino cruise ship off the coast of South Florida or its operation of the
gaming complex in Sunny Isles will be successful, the Registrant currently
believes that its prospects for profitable operation are positive. Of course,
there can be no assurances that the Registrant will not encounter one or more
insurmountable obstacles to successful operation of its current plan. In the
event that the Company encounters unanticipated costs, regulatory
difficulties, labor strife or other unanticipated adverse developments, its
operation of the cruise ship and the gaming complex will be adversely affected
and its prospects for profitable operations may, in that event, be precluded.
Item 5. Other Events
On January 4, 1999, the Registrant employed Mr. Lee C. Summers as Vice
President and Chief Executive Officer of the Registrant. Mr. Summers was also
appointed to a vacant seat on the Company's Board of Directors coincident with
commencement of his employment as an officer of the Registrant. Mr. Larry
Schwartz continues as the Company's President, Treasurer and Secretary and
maintains his seat on its Board of Directors. Mr. Summers has been a
practicing attorney admitted to practice in the States of Florida, Missouri
and Kentucky. Since January, 1994, Mr. Summers has been general business
counsel to the Registrant's affiliates First Consolidated Financial, Inc. and
First Capital Services, Inc., companies in common control with the Registrant
by virtue of the fact that its President, Mr. Larry Schwartz, is a Director of
all three companies.
Mr. Summers has accepted full time employment as the Company's Chief
Operating Officer and has terminated virtually all of his private law practice
to be able to assume that position. From October, 1991 through December, 1993
Mr. Summers was a partner at Mattlin & McClosky in Boca Raton, Florida. Mr.
Summers is 50 years of age and holds the Bachelor of Arts degree from
Vanderbilt University in Nashville, Tennessee, the Juris Doctor degree from
the University of Louisville School of Law in Louisville, Kentucky and the LLM
degree in taxation from Washington University, St. Louis, Missouri. While Mr.
Summers has extensive business transaction experience garnered from his
practice of law for more than 35 years, he has limited general management
experience and no gaming enterprise operational background.
Mr. Summers' employment as an officer and director of the Registrant is
undertaken pursuant to an employment agreement for a three (3) year term of
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employment with annual compensation ranging during the initial term from
$100,000 to $150,000. The Registrant is committed to review of Mr. Summers'
compensation in the event the Company were to become profitable and the
contract provides for 100,000 shares of the Company's Common Stock immediately
and stock options exercisable at $0.23 per share during the term of the
Employment Agreement. In addition, the employment contract provides for an
automobile allowance, paid vacation and reimbursement of reasonable expenses
incurred by Mr. Summers on the Company's behalf and in connection with its
operations.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TREASURE & EXHIBITS INTERNATIONAL , INC.
Dated: January 18, 1999
BY:/s/Larry Schwartz
Larry Schwartz, President
