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Rule 424(B)(3)
Registration No.
33-79484
CROWN CASINO [LOGO]
CORPORATION
SUPPLEMENT NO. 3 TO PROSPECTUS DATED MARCH 6, 1995
OF CROWN CASINO CORPORATION
Public Offering of
10,121,869 Shares of Common Stock
Form 8-K of Crown Casino Corporation filed with the Securities and Exchange
Commission on June 26, 1995 reporting the sale of a 50% interest in the
Company's St. Charles Gaming Company, Inc. subsidiary to Louisiana Riverboat
Gaming Partnership, as well as certain other matters.
The date of this Prospectus Supplement is July 3, 1995.
2415 W. Northwest Highway - Suite 103 - Dallas, TX 75220 - (214) 352-7561 -
FAX (214) 357-1974
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported) June 9, 1995
--------------------------------
Crown Casino Corporation
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(Exact name of registrant as specified in its charter)
Texas 0-14939 63-0851141
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
2415 West Northwest Highway, Suite 103, Dallas, Texas 75220-4446
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214) 352-7561
------------------------------
Not applicable
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(Former name or former address, if changed since last report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On June 9, 1995, Crown Casino Corporation (the "Company") closed the
sale of a 50% interest in its St. Charles Gaming Company, Inc. subsidiary
("SCGC") to Louisiana Riverboat Gaming Partnership ("LRGP"). LRGP is a joint
venture owned 50% by Casino America, Inc. and 50% by Louisiana Downs, Inc., an
Edward J. DeBartolo company, and owns the Isle of Capri casino in Bossier City,
Louisiana. As a result, the Lake Charles, Louisiana riverboat casino project,
whose site has been under construction since March 1995, is now owned equally
by the Company and LRGP.
The purchase price for 50% of the SCGC stock sold by the Company was
$21 million, payable over five years, plus a warrant entitling the Company to
purchase up to 416,667 shares of Casino America common stock at an exercise
price of $12 per share. The purchase price was negotiated at arms-length by
the parties to the Agreement. The casino project is being managed by Casino
America and will be the fourth Isle of Capri themed property. The casino is
expected to open in the Summer of 1995.
ITEM 5. OTHER EVENTS.
Also on June 9, 1995, the Company obtained a waiver from its senior
lender for the extension of the maturity date of its senior debt, which became
due on June 5, 1995. The waiver extends the maturity date of the Company's
senior debt to the earlier of (1) the final approval or disapproval by the
Louisiana Office of State Police, Riverboat Gaming Division, of the anticipated
new $30 million financing between the Company's senior lender and LRGP and
SCGC, and (2) July 31, 1995. In connection with the waiver, LRGP has
guaranteed the repayment of the Company's existing senior debt. As previously
reported, LRGP and SCGC anticipate closing the $30 million financing prior to
July 31, 1995.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(b) Proforma Financial Information.
The following proforma financial information is included in this
report:
Introduction to Condensed Consolidated Proforma Financial
Statements
Proforma Condensed Consolidated Balance Sheet (Unaudited) -
January 31, 1995
Proforma Consolidated Statement of Operations for the year
ended April 30, 1994 (Unaudited)
Proforma Consolidated Statement of Operations for the nine
months ended January 31, 1995 (Unaudited)
Notes to Proforma Condensed Consolidated Financial Statements
(c) Exhibits.
The following exhibits are hereby filed with this report:
2.1 - Amended Stock Purchase Agreement dated June 2, 1995
among Crown Casino Corporation, St. Charles Gaming
Company, Inc. and Louisiana Riverboat Gaming
Partnership.
4.1 - Waiver dated as of May 31, 1995 to Note Purchase
Agreement dated as of May 31, 1994, by and among Crown
Casino Corporation, St. Charles Gaming Company, Inc.,
Bank of New York and Nomura Holding America, Inc.
-2-
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10.1 - Security Agreement - Pledge dated June 9, 1995 by and
between Louisiana Riverboat Gaming Partnership and
Crown Casino Corporation
10.2 - Shareholders Agreement dated June 9, 1995 by and
between Crown Casino Corporation and Louisiana
Riverboat Gaming Partnership
-3-
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CROWN CASINO CORPORATION
PRO-FORMA FINANCIAL INFORMATION
SALE OF 50% OF SCGC
On June 9, 1995, Crown Casino Corporation ("Crown") closed the sale of a 50%
interest in its St. Charles Gaming Company, Inc. subsidiary ("SCGC") to
Louisiana Riverboat Gaming Partnership ("LRGP"). LRGP is a joint venture owned
50% by Casino America, Inc. and 50% by Louisiana Downs, Inc., an Edward J.
DeBartolo company, and owns the Isle of Capri casino in Bossier City,
Louisiana. As a result, the Lake Charles, Louisiana riverboat casino project,
whose site has been under construction since March 1995, is now owned equally
by Crown and LRGP.
The purchase price for 50% of the SCGC stock sold by Crown was $21 million,
payable over five years, plus a warrant entitling Crown to purchase up to
416,667 shares of Casino America common stock at an exercise price of $12 per
share. The purchase price was negotiated at arms-length by the parties to the
Agreement. The casino project is being managed by Casino America and will be
the fourth Isle of Capri themed property. The casino is expected to open in
the Summer of 1995.
Also on June 9, 1995, SCGC obtained a waiver from its senior lender for the
extension of the maturity date of its senior debt, which became due on June 5,
1995. The waiver extends the maturity date of SCGC's senior debt to the
earlier of (1) the final approval or disapproval by the Louisiana Office of
State Police, Riverboat Gaming Division, of the anticipated new $30 million
financing between SCGC's senior lender and LRGP and SCGC, and (2) July 31,
1995. In connection with the waiver, LRGP has guaranteed the repayment of
SCGC's existing senior debt. LRGP and SCGC anticipate closing the $30 million
financing prior to July 31, 1995.
SCGC was acquired by Crown on June 25, 1993. The financial results of SCGC
prior to it being acquired by Crown are not significant and have not been
reflected in the following Pro-Forma Statement of Operations for the year ended
April 30, 1994.
ACQUISITION OF GEMS
On December 13, 1993 Crown acquired 100% of the outstanding common stock of
Gaming Entertainment Management Services, Inc. ("GEMS"), a Nevada corporation
which was organized on September 22, 1992 for the purpose of developing a hotel
and casino project in Las Vegas, Nevada known as the Desert Winds Hotel and
Casino. GEMS via contract had the right to purchase an 18.6 acre parcel of
land in Las Vegas located on the southeast corner of Flamingo and Arville
across the street from the Gold Coast Hotel and Casino. The option was
exercised and the land was purchased in June 1994. GEMS has no operations
other than its development of the Desert Winds project. In connection with the
transaction the Company issued 850,000 shares of restricted common stock to the
GEMS shareholders and issued 35,000 shares of restricted common stock to a
company as a finder's fee.
PRO-FORMA FINANCIAL STATEMENTS
The following pro-forma consolidated balance sheet of Crown as of January 31,
1995 gives effect to the sale of 50% of Crown's interest in SCGC as if the sale
was consummated on January 31, 1995. The GEMS acquisition has already been
reflected in the historical consolidated balance sheet of Crown at such date.
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The following pro-forma consolidated statements of operations of Crown for the
nine months ended January 31, 1995 and for the year ended April 30, 1994 give
effect to the sale of a 50% interest in SCGC by Crown as if such sale had
occurred on May 1, 1993. The pro-forma consolidated statement of operations
for the year ended April 30, 1994 also gives effect to the acquisition of GEMS
under the purchase method of accounting as if it had occurred on May 1, 1993.
The pro-forma information is based on the historical financial statements of
Crown, SCGC and GEMS giving effect to the transactions described above and the
adjustments as described in the accompanying notes to the pro-forma condensed
consolidated financial statements and may not be indicative of the results that
actually would have occurred had the sale or acquisition taken place on the
date indicated or the results which may be obtained in the future.
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CROWN CASINO CORPORATION
PRO-FORMA CONDENSED CONSOLIDATED BALANCE SHEET
UNAUDITED
JANUARY 31, 1995
(IN THOUSANDS)
<TABLE>
<CAPTION>
Historical Deconsolidate Record Sale Pro-Forma
Consolidated SCGC and Record of 50% Interest Condensed
Crown on Equity Method in SCGC Consolidated
------------- ---------------- -------------- ------------
<S> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 903 $ (85) $ 900 $ 1,718
Receivables, net 156 156
Prepaid expenses 1,083 (1,003) 80
------- -------- -------- -------
Total current assets 2,142 (1,088) 900 1,954
Property and equipment:
Land held for development 16,560 16,560
Land deposit and site costs 57 (5) 52
Riverboat 14,906 (14,906)
Barges and improvements 350 (350)
Furniture, fixtures and equipment 8,803 (7,540) 1,263
------- -------- -------
40,676 (22,801) 17,875
Less accumulated depreciation (186) 11 (175)
------- -------- -------
40,490 (22,790) 17,700
Other assets:
Debt issuance costs, net 1,050 (1,050)
Non-compete agreement, net 342 (342)
License costs 9,125 (9,125)
Investment in SCGC 6,727 (3,364) 3,363
LRGP note receivable 20,000 20,000
------- -------- -------- -------
$53,149 $(27,668) $ 17,536 $43,017
======= ======== ======== =======
Current liabilities:
Accounts payable $ 591 $ (79) $ 512
Accrued liabilities 1,034 (918) (100) 16
Capital lease obligations 2,704 (2,700) 4
Note payable, net of discount 21,513 (21,513)
------- -------- -------- -------
Total current liabilities 25,842 (25,210) (100) 532
Capital lease obligations, less current portion 2,466 (2,458) 8
Deferred gain on sale 17,636 17,636
Stockholders' equity 24,841 24,841
------- -------- -------- -------
$53,149 $(27,668) $ 17,536 $43,017
======= ======== ======== =======
</TABLE>
See accompanying Notes to Pro-Forma Condensed Consolidated Financial
Statements.
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CROWN CASINO CORPORATION
PRO-FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED JANUARY 31, 1995
UNAUDITED
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Deconsolidate SCGC
Historical and Record on Pro-Forma
Crown Equity Method Adjustments Consolidated
---------- ------------------ ------------- ------------
<S> <C> <C> <C> <C>
Revenues $ - $ - $ -
Costs and expenses:
General and administrative 1,398 1,398
Gaming pre-opening and development 5,121 (4,668) 453
Depreciation and amortization 186 (83) 103
St. Charles Parish site abandonment 3,131 (3,131)
--------- ---------- --------- ---------
9,836 (7,882) 1,954
--------- ---------- --------- ---------
Net interest (income) expense:
Interest expense 4,800 (4,784) 16
Interest income (173) $ (1,725)(a) (1,898)
--------- ---------- --------- ---------
4,627 (4,784) (1,725) (1,882)
--------- ---------- --------- ---------
Equity in (income) loss of SCGC 9,700 (700)(c) 9,000
--------- ---------- --------- ---------
Loss before income taxes (14,463) 2,966 2,425 (9,072)
Provision (benefit) for income taxes (4,402) 2,966 673 (d) (763)
--------- ---------- --------- ---------
Net loss $ (10,061) $ - $ 1,752 $ (8,309)
========= ========== ========= =========
Loss per share $ (1.03) $ (.85)
========= =========
Weighted average shares outstanding 9,799 9,799
========= =========
</TABLE>
See accompanying Notes to Pro-Forma Condensed Consolidated Financial
Statements.
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CROWN CASINO CORPORATION
PRO-FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED APRIL 30, 1994
UNAUDITED
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Deconsolidate SCGC GEMS
Historical and Record on May 1, 1993 to Pro-Forma
Crown Equity Method December 12, 1993 Adjustments Consolidated
---------- ------------------ ----------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Revenues $ - $ - $ - $ -
Costs and expenses:
General and administrative 1,425 594 2,019
Gaming pre-opening and development 981 (943) 38
Depreciation and amortization 371 (334) 37
--------- ---------- --------- -------- --------
2,777 (1,277) 594 2,094
--------- ---------- --------- -------- --------
Net interest (income) expense:
Interest expense 578 11 589
Interest income (197) $ (2,300)(a) (2,497)
--------- ---------- --------- -------- --------
381 11 (2,300) (1,908)
--------- ---------- --------- -------- --------
Equity in loss of SCGC 843 2,440 (b) 3,283
--------- ---------- --------- -------- --------
Loss from continuing operations before
income taxes (3,158) 434 (605) (140) (3,469)
Provision (benefit) for income taxes (1,106)
---------
434 897 (d) 225
---------- --------- -------- --------
Loss from continuing operations (2,052) (605) (1,037) (3,694)
Discontinued operations (177) (177)
--------- ---------- --------- -------- --------
Net loss $ (2,229) $ - $ (605) $ (1,037) $ (3,871)
========= ========== ========= ======== ========
Loss per share:
From continuing operations $ (.34) $ (.55)
From discontinued operations (.03) (.02)
--------- --------
$ (.37) $ (.57)
========= ========
Weighted average shares outstanding 5,989 6,778
========= ========
</TABLE>
See accompanying Notes to Pro-Forma Condensed Consolidated Financial
Statements.
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CROWN CASINO CORPORATION
NOTES TO PRO-FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS)
The sale of a 50% interest in SCGC by Crown causes Crown's remaining 50%
interest in SCGC to be accounted for under the equity method of accounting as
opposed to consolidating such results. Accordingly, all assets and
liabilities, as well as revenues and expenses, of SCGC have been removed from
Crown's historical consolidated financial statements. For balance sheet
purposes, Crown's remaining 50% interest in SCGC is reflected in the
"Investment in SCGC" account. Similarly, Crown's 50% interest in the
operations of SCGC have been reflected in the "Equity in loss of SCGC" account
in the accompanying Pro-Forma Consolidated Statements of Operations. However,
as noted below, since the realization of the gain on the sale of the 50%
interest in SCGC is not as yet reasonably assured, all of SCGC's loss (ie. not
just Crown's 50%) is recognized in the "Equity in loss of SCGC" account in the
accompanying Pro-Forma Consolidated Statements of Operations. The calculation
of Crown's (i) deferred gain on the sale of the 50% interest in SCGC, and (ii)
remaining basis in its 50% interest in SCGC, is as follows:
<TABLE>
<S> <C> <C>
Consideration for sale of 50% interest in SCGC $ 21,000
Crown's basis in SCGC:
Equity in SCGC $ 5,718
Conversion of SCGC debt to equity 1,009
-------
6,727
Percentage sold x 50%
-------
Basis sold 3,364
--------
Deferred gain $ 17,636
========
</TABLE>
The gain on the sale of the 50% interest in SCGC has been deferred until such
time as its realization is reasonably assured. Realization of such gain is
dependent on collection of the LRGP Note which in turn is principally dependent
on future operating profits, which have not as yet been assured. The principal
payments on the LRGP Note prior to maturity are limited to the amount of
distributions received by LRGP from SCGC's operations, and payment of such Note
is not guaranteed by LRGP. Similarly, no gain will be recognized for income
tax purposes as Crown will elect to report such gain as an installment sale.
NOTE
a - To record interest income at 11.5% on the $20,000 LRGP Note received in
the sale of the 50% interest in SCGC.
b - To record adjustment in equity in loss of SCGC due to the $4,000
buy-out of the Century Casinos, Inc. management agreement, net of an
income tax benefit of $1,560.
c - To record adjustment in equity in loss of SCGC to reflect a lower
interest expense of $1,100 due to the estimated difference in interest
rates to be obtained with LRGP's credit assistance (11.5% versus 13%),
and a lower level of debt issuance costs and discount and related
amortization thereof, net of an income tax benefit of $400.
d - To record the impact on income taxes of the adjustment described in
Note a above based upon a 39% effective income tax rate.
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SIGNATURES
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 hereunto duly authorized.
CROWN CASINO CORPORATION
By:/s/ Mark D. Slusser
-----------------------------
Mark D. Slusser
Vice President Finance
Dated: June 21, 1995
--------------------------
