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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 Exchange Act of 1934
Date of Report (Date earliest event reported) August 16, 2000
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MTR GAMING GROUP, INC.
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(exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
0-20508 84-1103135
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(Commission File Number) (IRS Employer Identification Number)
STATE ROUTE 2 SOUTH, CHESTER, WEST VIRGINIA
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(Address of principal executive offices)
26034
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(Zip Code)
Registrant's Telephone Number, Including Area Code: (304) 387-5712
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N/A
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(Former name or former address, if changed since last report)
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Item 5. OTHER EVENTS.
On August 16, 2000, MTR Gaming Group, Inc. and its wholly-owned
subsidiaries, Mountaineer Park, Inc., Speakeasy Gaming of Las Vegas, Inc.,
and Speakeasy Gaming of Reno, Inc. (collectively, the "Company"), entered
into an amended and restated five-year senior secured revolving credit
facility in the principal amount of $60 million (the "Wells Fargo Loan") with
Wells Fargo Bank, National Association ("Wells Fargo"). The amended and
restated credit facility increases the amount of available borrowings from
$38.5 million to $60 million. The Company will use the increased borrowings
primarily to continue the expansion of the Mountaineer Racetrack and Gaming
Resort in Chester, West Virginia.
SUMMARY OF THE WELLS FARGO LOAN
Some of the more important terms of the Wells Fargo Loan and the credit
agreement evidencing such loan (the "Credit Agreement") are as follows:
a. The loan is a five-year revolving commitment with no
required amortization of principal, except in certain
circumstances.
b. The Company may elect to borrow at the London
Interbank Offered Rate (LIBOR) plus a margin ranging
from 1.5% to 2.5% ("LIBOR Loans"). Alternatively, the
Company may elect to borrow either at the Prime Rate
or Federal Funds Rate, plus a margin ranging from
0.25% to 1.25% ("Base Rate Loans"). The applicable
margin added to the London Interbank Offered Rate,
Prime Rate, or Federal Funds Rate will depend upon
the Company's Leverage Ratio (as defined in the
Credit Agreement). Presently, the applicable margin
is 2% over LIBOR and 0.75% over the Prime Rate or
Federal Funds Rate.
c. LIBOR Loans (which, depending upon the election made
by the Company, will have a term of one, two, three
or six months) will have substantial prepayment
penalties; Base Rate loans will have no prepayment
penalty.
d. The Company shall pay a quarterly commitment fee on
its unused borrowing capacity.
e. The Credit Agreement contains a number of affirmative
and negative covenants which, among other things,
require the Company to maintain certain financial
ratios and refrain from certain actions without Wells
Fargo's concurrence. Customary events of default
provisions are also included.
f. Substantially all of the Company's assets, including
all of the capital stock of Mountaineer Park, Inc.,
Speakeasy Gaming of Las Vegas, Inc. and Speakeasy
Gaming of Reno, Inc., are pledged as security for
repayment of the Wells Fargo Loan.
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g. The applicable margin to be added to the
above-mentioned benchmark interest rates will
generally be determined quarterly based upon the
Company's Leverage Ratio in accordance with the
following table:
<TABLE>
<CAPTION>
=========================================================================================
LIBO
BASE RATE RATE
LEVERAGE RATIO MARGIN MARGIN
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<S> <C> <C>
Greater than or equal to 2.00 to 1.00 1.25% 2.50%
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Greater than or equal to 1.50 to 1.0 but less than 2.00 1.00% 2.25%
to 1.00
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Greater than or equal to 1.00 to 1.0 but less than 1.50 0.75% 2.00%
to 1.00
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Less than 1.00 to 1.00 0.25% 1.50%
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</TABLE>
h. The Credit Agreement requires the Company to maintain
at least $8 million in key man life insurance on
Edson R. Arneault throughout the term of the loan and
to prepay $4 million of the outstanding principal in
the event of Mr. Arneault's death.
i. The Credit Agreement also requires the Company to
spend a minimum of 2% and a maximum of 6% of gross
revenues on maintenance of the Company's properties.
j. The Credit Agreement permits the Company to incur up
to $13 million of additional senior indebtedness for
the purchase or lease of gaming equipment.
k. The financing also involved the payment of customary
fees and charges to the banks and the Company's
financial advisor.
The foregoing summary of the Wells Fargo Loan is qualified in its
entirety by the terms of the Credit Agreement, which is filed under Item 7
below.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
The following are filed as exhibits to this report:
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
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<S> <C>
10.1 Credit Agreement
99.1 Press Release
</TABLE>
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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.
MTR GAMING GROUP, INC.
By: /s/ EDSON R. ARNEAULT
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Edson R. Arneault, President
Date: August 17, 2000
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