<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Casino America, Inc.
- - - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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<PAGE>
CASINO AMERICA, INC.
711 WASHINGTON LOOP
BILOXI, MISSISSIPPI 39530
(601) 436-7000
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 25, 1997
----------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of Casino America, Inc., a Delaware corporation (the "Company"),
will be held on September 25, 1997 at 10:00 a.m., Central Standard Time at the
Isle of Capri--Lake Charles, 100 Westlake Avenue, Westlake, Louisiana, 70669-
9801, for the following purposes, all of which are set forth more completely
in the accompanying proxy statement:
(1) To elect seven persons to the Company's Board of Directors;
(2) To approve an amendment to the Company's 1993 Stock Option Plan to
increase the number of shares of the Company's common stock available for
issuance thereunder by 1,150,000 shares;
(3) To approve the selection of Ernst & Young LLP as the Company's
independent auditors for the fiscal year ending April 26, 1998; and
(4) To transact such other business as may properly come before the
Annual Meeting or any adjournment thereof.
Pursuant to the Company's by-laws, the Board of Directors has fixed the
close of business on August 22, 1997, as the record date for the determination
of stockholders entitled to notice of and to vote at the Annual Meeting. A
proxy statement with respect to the Annual Meeting accompanies and forms a
part of this Notice. The Annual Report of the Company for the fiscal year
ended April 27, 1997 also accompanies this Notice.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT
YOU PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE MARK, SIGN AND
DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH
DOES NOT REQUIRE POSTAGE IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors,
Bernard Goldstein,
Chairman and Chief
Executive Officer
Biloxi, Mississippi
August 25, 1997
<PAGE>
CASINO AMERICA, INC.
711 WASHINGTON LOOP
BILOXI, MISSISSIPPI 39530
(601) 436-7000
----------------
PROXY STATEMENT
----------------
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Casino America, Inc., a Delaware corporation (the
"Company"), of proxies for use at the Annual Meeting of Stockholders of the
Company to be held on September 25, 1997, beginning at 10:00 a.m., Central
Standard Time, at the Isle of Capri--Lake Charles, 100 Westlake Avenue,
Westlake, Louisiana, 70669-9801, and at any adjournment(s) thereof. The
approximate date on which this Proxy Statement and the enclosed proxy are
first being mailed to stockholders is August 27, 1997.
VOTING RIGHTS AND PROCEDURES
The Company's common stock, $.01 par value per share (the "Common Stock"),
is the only issued and outstanding class of stock. At the close of business on
July 30, 1997, the Company had outstanding 23,360,187 shares of Common Stock
(each, a "Share"). Each Share entitles the holder thereof to one vote on each
matter submitted to a vote of stockholders. Only holders of record of the
Common Stock at the close of business on August 22, 1997 (the "Record Date"),
are entitled to notice of and to vote at the Annual Meeting or any
adjournment(s) thereof.
Shares represented by an effective proxy given by a stockholder will be
voted as directed by the stockholder. A stockholder who submits a proxy on the
accompanying form has the right to revoke it at any time prior to its use by
(i) delivering a written notice to the Secretary of the Company, (ii)
executing a later-dated proxy or (iii) attending the Annual Meeting and voting
in person. The form of proxy provides a space for stockholders to withhold
their vote for any proposal. Stockholders are urged to indicate their vote on
each matter in the space provided. If a properly executed proxy form is
returned to the Company and no space is marked, it will be voted by the
persons therein named at the meeting: (i) for the election of the directors
recommended by the Board of Directors; (ii) to approve an amendment to the
Company's 1993 Stock Option Plan (the "Option Plan" or the "1993 Plan") to
increase the number of shares of the Company's common stock available for
issuance thereunder by 1,150,000; (iii) for the selection of Ernst & Young LLP
("Ernst & Young") as the Company's independent auditors for the fiscal year
ending on April 26, 1998; and (iv) in their discretion, upon such other
business as may properly come before the meeting. Whether or not you plan to
attend the meeting, please fill in, sign and return your proxy card to the
transfer agent in the enclosed envelope, which requires no postage if mailed
in the United States.
A majority of the outstanding Shares entitled to vote, represented either in
person or by proxy, will constitute a quorum at the Annual Meeting. Directors
will be elected by a plurality of the votes present in person or represented
by proxy at the Annual Meeting and voting for the election of directors,
provided a quorum is present. Stockholders are not allowed to cumulate their
votes in the election of directors. Approval of the selection of Ernst & Young
as the Company's independent auditors for the fiscal year ending on April 26,
1998 will require an affirmative vote of the holders of a majority of the
Shares present or represented at the Annual Meeting and voting on such
proposal, provided a quorum is present. Approval of the amendment to the
Option Plan will require an affirmative vote of the holders of a majority of
the Shares present or represented at the Annual Meeting and entitled to vote
thereon, provided a quorum is present.
In all cases, abstentions will be treated as Shares that are present or
represented and entitled to vote for purposes of determining the presence of a
quorum. In the case of electing directors and approving the selection
<PAGE>
of Ernst & Young, abstentions will be treated as not voting on such matters.
Accordingly, abstentions will have no effect on the number of votes necessary
to elect directors or to approve the selection of the independent auditors. In
the case of approving the amendment to the Option Plan, however, abstentions
will count as votes against the amendment to the Option Plan.
In instances where brokers are prohibited from exercising discretionary
authority for beneficial owners who have not returned a proxy (so-called
"broker non-votes"), those Shares will not be treated as present or represented
and entitled to vote for purposes of determining the presence of a quorum and
will not be treated as present or represented and voting for purposes of
determining the number of votes necessary for the approval of any matter on
which they do not have discretionary authority to vote. Accordingly, broker
non-votes will have no effect on the number of votes necessary to elect
directors or to approve the amendment to the Option Plan or the selection of
the independent auditors. In the event that there are not sufficient votes for
approval of any of the matters to be voted upon at the meeting, the meeting may
be adjourned in order to permit further solicitation of proxies.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the election inspectors appointed for the Annual Meeting and such election
inspectors will determine whether or not a quorum is present.
The Company will bear all costs of soliciting proxies including charges made
by brokers and other persons holding stock in their names or in the names of
nominees for reasonable expenses incurred in sending proxy material to
beneficial owners and obtaining their proxies. In addition to solicitation by
mail, directors, officers and employees of the Company may solicit proxies
personally and by telephone and telegraph, all without extra compensation. The
Company has retained D. F. King & Co., Inc. to assist in the solicitation of
proxies. The fee to be paid to such firm for such services will be borne by the
Company and is not expected to exceed $2,500 plus reasonable expenses.
1. ELECTION OF DIRECTORS
The Company currently has six directors. The Company's bylaws provide that
the number of Directors of the Company may be increased by the Board of
Directors, and the Board of Directors has determined that it is in the
Company's best interest, and has resolved, to have seven directors serve until
the next annual meeting of the shareholders. Each director of the Company holds
office until his successor is elected and qualified or until his earlier death,
resignation, removal or disqualification.
The seven nominees for whom the enclosed proxy is intended to be voted are
set forth below. All nominees are now serving as directors of the Company with
the exception of Randolph Baker. Each of these nominees has indicated his
willingness to serve if elected, and the Board of Directors has no reason to
believe that any of these nominees will be unavailable for election, but if
such a situation should arise, the proxy will be voted in accordance with the
best judgment of the proxyholder for such person or persons as may be
designated by the Board of Directors, unless the stockholder has directed
otherwise.
<TABLE>
<CAPTION>
NAME AGE POSITION(S)
---- --- -----------
<S> <C> <C>
Bernard Goldstein..... 68 Chairman, Chief Executive Officer and Director
John M. Gallaway...... 59 President, Chief Operating Officer
and Director
Allan B. Solomon...... 61 Executive Vice President, Secretary,
General Counsel and Director
Robert S. Goldstein... 42 Director
Alan J. Glazer........ 56 Director
Emanuel Crystal....... 70 Director
Randolph Baker........ 50 Director
</TABLE>
2
<PAGE>
Bernard Goldstein has been Chairman of the Board of the Company since June
1992 and Chief Executive Officer of the Company since September 1995. From
June 1992 until February 1993, and from September 1995 to December 1995, Mr.
Goldstein was also President of the Company. Mr. Goldstein has been active in
the development of the riverboat gaming industry in a number of states and was
Chairman of the Board of Steamboat Development Corporation and Steamboat
Southeast, Inc. (collectively, the "Steamboat Companies"), companies involved
in the first legalized riverboat gaming ventures in the United States. In
addition to his involvement in the riverboat gaming industry, Mr. Goldstein
has been involved in scrap metal recycling since 1951 and barge-line
transportation since 1960. Mr. Goldstein is the father of Robert Goldstein.
John M. Gallaway has been President of the Company since December 1995,
Chief Operating Officer since July 1996 and a director since April 1996. From
July 1995 to November 1995, Mr. Gallaway was a professor at the University of
Houston. Mr. Gallaway was Deputy Managing Director, Gaming, of Sun
International, a company engaged in owning and operating casinos and resorts,
from September 1992 to August 1994. Prior to that, from 1984 to 1992, Mr.
Gallaway was President and General Manager of TropWorld Casino Resort in
Atlantic City and, from 1981 to 1984, he was President and General Manager of
the Tropicana Casino Hotel in Las Vegas.
Allan B. Solomon has been Secretary and a director of the Company since June
1992, served as the Chief Financial Officer and Treasurer of the Company from
June 1992 to October 6, 1993, and was Chairman of the Executive Committee from
January 1993 to April 1995. Mr. Solomon became General Counsel of the Company
in May 1994 and became Executive Vice President in April 1995. Mr. Solomon is
President of Allan B. Solomon, P.A., which was a partner in the Florida law
firm of Broad and Cassel from 1986 to May 1994.
Robert S. Goldstein has been a director of the Company since February 1993.
Mr. Goldstein is the President of Alter Trading Corporation, a company engaged
in the business of scrap metal recycling, and has been associated with that
company since 1977. Additionally, Mr. Goldstein is a director, officer and
stockholder of the Steamboat Companies and has been an officer of several
affiliated river transportation companies engaged in stevedoring and equipment
leasing since 1980. Mr. Goldstein is the son of Bernard Goldstein.
Emanuel Crystal has been a director of the Company since October 1993, and
is currently the Chief Executive Officer of Jackson Iron & Metal Company in
Jackson, Mississippi. He has held that position for over five years and has
served in various positions with that company since 1949. Mr. Crystal serves
on the Board of Trustees of Tougaloo College in Mississippi.
Alan J. Glazer has been a director of the Company since November 1996, and
is currently Vice President and Regional Managing Director of Morris Anderson
& Associates. Ltd., a management consulting firm. Mr. Glazer also serves as a
director of Alter Barge Lines, Inc., a private company owned by Bernard
Goldstein and members of his family.
Randolph Baker has been nominated by the Board of Directors to serve as a
director of the Company. Since June 1996, Mr. Baker has been President of
Thompson & Baker, a public relations and public affairs firm located in
Memphis, Tennessee. From July 1995 to July 1996, Mr. Baker was a visiting
professor of gaming studies at the University of Nevada--Reno. From 1989 to
1995, Mr. Baker was Director of Public Affairs for The Promus Companies, Inc.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
ELECTION OF EACH NOMINEE FOR DIRECTOR NAMED ABOVE.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors has three standing committees: the Compensation
Committee, the Stock Option Committee and the Audit Committee. The Board of
Directors does not have a Nominating Committee or any
3
<PAGE>
committee performing similar functions. During the fiscal year ended April 27,
1997 ("fiscal 1997"), the Board of Directors met 13 times, the Compensation
Committee met six times, the Stock Option Committee met six times, and the
Audit Committee met two times. During fiscal 1997, all directors attended at
least 75% of the meetings of the Board of Directors and the committees thereof
on which they served.
Messrs. Alan J. Glazer, Robert S. Goldstein and Emanuel Crystal are members
of the Compensation Committee. Mr. Glazer acts as chairman of the Compensation
Committee. The Compensation Committee acts as an advisory committee to the full
Board with respect to matters of compensation, including option grants and
bonuses, with respect to the officers and other employees of the Company.
Messrs. Alan J. Glazer, Robert S. Goldstein and Emanuel Crystal are members
of the Stock Option Committee. Mr. Glazer acts as chairman of the Stock Option
Committee. The Stock Option Committee administers the Company's stock option
plans.
Messrs. Emanuel Crystal, Alan J. Glazer and Robert S. Goldstein are members
of the Audit Committee. Mr. Crystal acts as chairman of the Audit Committee.
The Audit Committee's responsibilities include recommending to the Board the
selection of the Company's independent certified public accountants, reviewing
the arrangements and the scope of the independent audit and reviewing all
financial statements.
EXECUTIVE OFFICERS
Set forth below is a table identifying the executive officers of the Company
other than Messrs. Goldstein, Gallaway and Solomon, each of whom is identified
in the section entitled "Election of Directors."
<TABLE>
<CAPTION>
NAME AGE POSITION(S)
---- --- -----------
<S> <C> <C>
Timothy M. Hinkley......... 42 Senior Vice President of Operations
Rexford A. Yeisley......... 50 Vice President and Chief Financial Officer
Robert Boone............... 48 Vice President
Edward Reese, Jr. ......... 62 Vice President
James Guay................. 38 Vice President
</TABLE>
Timothy M. Hinkley has been Senior Vice President of Operations for Casino
America since April 1997. Mr. Hinkley was General Manager and Vice President of
the Isle of Capri Casino Crowne Plaza Resort in Biloxi, Mississippi from May
1992 to April 1997. Prior to that, from 1990 to 1992, Mr. Hinkley was Vice
President of Food and Beverage and Entertainment of Steamboat Development
Corporation, a riverboat gaming company in Iowa.
Rexford A. Yeisley has been Chief Financial Officer of the Company since
December 1995. Mr. Yeisley was Senior Vice President and Chief Financial
Officer of Six Flags Theme Parks, Inc. from 1991 to 1995, and from 1987 to
1991, Mr. Yeisley was Vice President and Chief Financial Officer of that
company.
Robert Boone has been Vice President in charge of Human Resources and Risk
Management since August 1994. From 1991 to 1994, Mr. Boone was the Director,
Human Resources and Administration for Simon MOA Management Company, the
managing general partner at Mall of America, the nation's largest retail and
entertainment complex. From 1986 to 1991, Mr. Boone served as Director of Human
Resources for IDS American Express in Minneapolis, Minnesota.
Edward Reese, Jr. has been Vice President in charge of Construction and
Design since August 1996. From January 1996 to August 1996, Mr. Reese was the
Vice President, Construction for H.W.C.C. Development Corporation, a subsidiary
of a casino operator. From October 1986 to January 1996, Mr. Reese was the Vice
President-Design and Construction for Aztar Corporation, a company engaged in
gaming, and the gaming division of its predecessor, Ramada, Inc.
4
<PAGE>
James Guay has been Vice President in charge of Marketing since March 1997.
From September 1994 to March 1997, Mr. Guay was the Vice President of
Marketing for Trump Plaza Hotel & Casino in Atlantic City, New Jersey. For
brief periods during 1994, Mr. Guay was Vice President of Marketing for
Spectrum Gaming and a Marketing Consultant for J. Caserta & Associates. From
1991 to 1994, he was Assistant Vice President--Marketing Operations for
Showboat Casino--Hotel in Atlantic City, New Jersey.
COMPLIANCE WITH SECTION 16(A) OF THE
EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's directors, officers
and certain stockholders to file with the Commission an initial statement of
beneficial ownership and certain statements of changes in beneficial ownership
of equity securities of the Company. Based solely upon a review of Forms 3 and
4 and amendments thereto furnished to the Company during fiscal 1997, Forms 5
and amendments thereto furnished with respect to fiscal 1997, and certain
written representations received by the Company from certain reporting persons
in regard to filing requirements, the Company has determined that all such
filings were made on a timely basis, with the exception of a late filing of a
Form 3 by Timothy Hinkley.
OWNERSHIP OF THE CAPITAL STOCK OF THE COMPANY
The following table sets forth certain information with respect to the
beneficial ownership of the outstanding Common Stock as of July 30, 1997
(unless otherwise indicated) by (i) each director of the Company, (ii) the
individuals serving as the Company's chief executive officer during fiscal
1997 and each of the four individuals serving as executive officers of the
Company as of April 27, 1997 named in the table under "Compensation of
Directors and Executive Officers--Summary Compensation Table," (iii) all
directors and officers of the Company as of July 30, 1997 as a group and (iv)
based on information available to the Company and a review of statements filed
with the Securities and Exchange Commission (the "Commission") pursuant to
Sections 13(d) and 13(g) of the Securities Exchange Act of 1934 (the "Exchange
Act"), each person that owned beneficially (directly or together with
affiliates) more than 5% of the Common Stock. Unless otherwise indicated, all
persons listed have sole voting and dispositive power over the shares
beneficially owned.
<TABLE>
<CAPTION>
SHARES OF PERCENTAGE OF
COMMON STOCK OUTSTANDING
NAME AND ADDRESS BENEFICIALLY SHARES
OF 5% BENEFICIAL OWNERS OWNED(1) OWNED(1)
----------------------- ------------ -------------
<S> <C> <C>
Bernard Goldstein (2).......................... 2,986,501 12.8%
2200 Corporate Boulevard, N.W.
Boca Raton, Florida 33431
Robert S. Goldstein (3)........................ 1,081,655 4.6%
Allan B. Solomon (4)........................... 438,670 1.9%
Alan Glazer (5)................................ 21,250 *
Emanuel Crystal (6)............................ 56,575 *
John M. Gallaway (7)........................... 69,000 *
Rexford A. Yeisley (8)......................... 16,000 *
Robert Boone (9)............................... 19,850 *
All Officers and Directors as a Group
(11 persons) (10)............................. 4,721,060 19.9%
</TABLE>
- - - --------
*Less than 1%.
(1) Calculated pursuant to Rule 13d-3 under the Exchange Act. Under Rule 13d-
3(d), shares not outstanding that are subject to options, warrants, rights
or conversion privileges exercisable within 60 days of July 30,
5
<PAGE>
1997, are deemed outstanding for the purpose of calculating the number and
percentage owned by such person, but are not deemed outstanding for the
purpose of calculating the percentage owned by each other person listed.
(2) Does not include an aggregate of 3,159,965 shares (including 80,000 shares
issuable upon exercise of stock options and warrants that are exercisable
within 60 days) that are beneficially owned by members of Bernard
Goldstein's family. Bernard Goldstein disclaims beneficial ownership of the
shares owned by members of his family. Includes 40,000 shares issuable upon
exercise of stock options that are exercisable within 60 days.
(3) Does not include an aggregate of 5,064,811 shares (including 65,000 shares
issuable upon exercise of stock options and warrants that are exercisable
within 60 days) that are beneficially owned by members of Robert
Goldstein's family. Robert Goldstein disclaims beneficial ownership of the
shares owned by members of his family. Includes 55,000 shares issuable upon
exercise of stock options that are exercisable within 60 days.
(4) Includes 156,250 shares issuable upon exercise of stock options that are
exercisable within 60 days.
(5) Includes 11,250 shares issuable upon exercise of stock options that are
exercisable within 60 days.
(6) Includes 32,500 shares issuable upon exercise of stock options that are
exercisable within 60 days and 1,575 shares owned by Mr. Crystal's wife.
(7) Includes 60,000 shares issuable upon exercise of stock options that are
exercisable within 60 days.
(8) Includes 15,000 shares issuable upon exercise of stock options that are
exercisable within 60 days.
(9) Includes 19,850 shares issuable upon exercise of stock options that are
exercisable within 60 days.
(10) Information provided is for the individuals who were officers and
directors of the Company on July 30, 1997 and includes 420,874 shares
issuable upon exercise of stock options that are exercisable within 60
days. The amount does not include 2,078,310 shares (including 25,000
shares issuable upon exercise of warrants that are exercisable within 60
days) beneficially owned by relatives of Bernard Goldstein and Robert S.
Goldstein, other than them, the beneficial ownership of which is
disclaimed by Bernard Goldstein and Robert S. Goldstein. If such shares
were included in the category "All Officers and Directors as a Group," the
number of shares of Common Stock beneficially owned by such group as of
July 30, 1997 would have been 6,799,320, and the percentage of outstanding
shares of Common Stock owned by such group as of July 30, 1997 would have
been 28.6%.
6
<PAGE>
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
The following table sets forth a summary of the annual, long-term and other
compensation for services rendered to the Company by the Company's Chief
Executive Officer during fiscal 1997 and the four most highly compensated
executive officers (other than the chief executive officer) during fiscal 1997
(the "Named Executive Officers") for the years indicated.
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
------------------------------------------------ ------------
FISCAL SECURITIES
NAME AND PRINCIPAL YEAR ENDED OTHER ANNUAL UNDERLYING ALL OTHER
POSITION APRIL SALARY (1) BONUS (1) COMPENSATION (2) OPTIONS (#) COMPENSATION (3)
------------------ ---------- ---------- --------- ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
Bernard Goldstein....... 1997 $350,000 -- -- 70,000 35,017
Chairman and 1996 190,692 50,000 -- 15,000 54,021
Chief Executive Officer 1995 125,246 90,000 -- 10,000 57,976
John M. Gallaway........ 1997 350,000 -- 6,000 92,500 19,146
President and Chief 1996 109,615 17,500 2,192 65,000 29,167
Operating Officer 1995 -- -- -- -- --
Allan B. Solomon........ 1997 285,000 23,500 6,000 50,000 8,360
Executive Vice 1996 225,846 115,000 6,000 15,000 51,016
President, 1995 212,769 50,000 5,769 17,500 50,251
General Counsel and
Secretary
Rexford A. Yeisley...... 1997 167,885 36,000 6,000 35,000 37,803
Vice President and 1996 51,692 10,750 2,053 45,000 --
Chief Financial Officer 1995 -- -- -- -- --
Robert Boone............ 1997 124,615 24,000 6,000 35,000 2,818
Vice President 1996 107,462 27,500 6,000 15,000 2,310
1995 70,475 40,000 4,154 17,500 9,265
</TABLE>
- - - --------
(1) Mr. Goldstein receives his salary and bonus in shares of Common Stock. Mr.
Goldstein's salary is paid in the number of shares equal to his net monthly
salary based on the closing price of the Company's Common Stock, as
reported on the Nasdaq National Market, on the 15th day of that month (or
the last preceding trading day if the 15th is a Saturday, Sunday or
holiday).
(2) Includes an annual auto allowance of $6,000 paid by the Company for Messrs.
Gallaway, Solomon, Yeisley and Boone, respectively.
(3) Includes the Company's matching contribution to the Company's 401(k)
deferred compensation plan during fiscal 1997 for the accounts of Messrs.
Goldstein and Boone of $2,375 each, relocation costs paid by the Company
for Messrs. Gallaway and Yeisley of $14,883 and $26,523, respectively,
temporary housing for Messrs. Gallaway and Yeisley of $3,027 and $10,501,
respectively, interest paid to Mr. Goldstein in the amount of $30,284 for
an available line of credit to the Company and medical insurance paid by
the Company for Messrs. Goldstein, Gallaway, Solomon, Yeisley and Boone of
$2,358, $1,236, $8,360, $779 and $443, respectively.
7
<PAGE>
OPTION GRANTS FOR LAST FISCAL YEAR
The following table sets forth information concerning options granted during
fiscal 1997 to the Named Executive Officers.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE OF ASSUMED
ANNUAL RATES OF STOCK
PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
--------------------------- ---------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS GRANTED EXERCISE OR
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED (#) FISCAL YEAR $/SHARE DATE 5% ($) 10% ($)
- - - ---- ----------- --------------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Bernard Goldstein....... 10,000 9.0% 6.25 05/10/06 $ 63,739 $ 138,515
60,000 3.06 12/20/06 112,655 288,137
John M. Gallaway........ 10,000 11.9% 6.25 05/10/06 63,739 138,515
22,500 6.38 08/22/06 85,626 221,308
60,000 3.06 12/20/06 112,655 288,137
Allan B. Solomon........ 10,000 6.4% 6.25 05/10/06 63,739 138,515
40,000 3.06 12/20/06 75,103 192,091
Rexford A. Yeisley...... 35,000 4.5% 3.06 12/20/06 65,716 168,080
Robert Boone............ 35,000 4.5% 3.06 12/20/06 65,716 168,080
Edward Reese............ 22,500 7.4% 6.38 08/22/06 85,626 221,308
35,000 3.06 12/20/06 65,716 168,080
James Guay.............. 30,000 3.9% 2.56 03/17/07 46,131 118,947
Timothy Hinkley......... 10,000 4.5% 2.12 04/07/07 15,450 37,159
25,000 3.06 12/20/06 46,940 120,057
</TABLE>
- - - --------
(1) The potential realizable dollar value of a grant is the product of: (a) the
difference between (i) the product of the per-share market price at the
time of the grant and the sum of 1 plus the stock appreciation rate
compounded annually over the term of the option (here, 5% and 10%) and (ii)
the per-share exercise price of the option and (b) the number of securities
underlying the grant at fiscal year-end.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth information concerning the number and value of
shares acquired on the exercise of options and exercisable and unexercisable
stock options at the end of fiscal 1997 for the Named Executive Officers.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
SHARES ACQUIRED VALUE YEAR END FISCAL YEAR END ($)
NAME ON EXERCISE (#) REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- --------------- -------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Bernard Goldstein....... -- -- 29,875/87,625 $--
John M. Gallaway........ -- -- 28,000/129,500 --
Allan B. Solomon........ -- -- 108,625/108,875 --
Rexford A. Yeisley...... -- -- 13,500/66,500 --
Robert Boone............ -- -- 14,750/52,750 --
</TABLE>
COMPENSATION OF DIRECTORS
Directors who are not employed by the Company receive a $50,000 annual
retainer and additional compensation of $1,000 per day for Board meetings
attended. Directors who are employees of the Company receive no additional
compensation for serving as directors. All directors are reimbursed for travel
and other
8
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expenses incurred in connection with attending Board meetings. In addition,
upon the initial election or appointment of any person to the Board of
Directors, such director receives options to acquire 22,500 shares of Common
Stock pursuant to the provisions of the Option Plan.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
In December 1995, the Company entered into separate employment agreements
with John M. Gallaway, President and Chief Operating Officer (as of July 1996),
Allan B. Solomon, Executive Vice President, General Counsel and Secretary, and
Rexford A. Yeisley, Vice President and Chief Financial Officer (collectively,
the "Employment Agreements"). Pursuant to the Employment Agreements, Messrs.
Gallaway, Solomon and Yeisley receive an initial annual base salary of
$300,000, $235,000 and $160,000, respectively, subject to increases as may be
determined by the Company's Board of Directors from time to time. In addition,
Messrs. Gallaway and Yeisley received options to purchase 50,000 and 30,000
shares of Common Stock, respectively, at the fair market price of shares at the
date of issuance. Each of Messrs. Gallaway, Solomon and Yeisley are entitled to
participate in any stock option or other benefit plans of the Company. The
Employment Agreements are each for an initial term of three years, and are
automatically renewable for successive one-year periods thereafter, unless 90
days' written notice is given by either party. If the Company terminates the
employment of the respective party to the Employment Agreement without "cause"
(as defined in the Employment Agreements), either during the initial term or
any renewal term or by written notice of nonrenewal, such person would be
entitled, upon releasing the Company and its affiliates from any and all
claims, to receive his salary and employee benefits for the greater of (i) one
year or (ii) 50% of the salary and employee benefits for the remaining term of
employment. In July 1995, the Company entered into an employment agreement with
Robert F. Boone, Vice President in charge of Human Resources, with terms
substantially similar to the Employment Agreements described above. Mr. Boone
received an initial annual base salary of $100,000, subject to increases as
determined by the Company's Board of Directors from time to time. In August
1996, the Company entered into an employment agreement with Edward F. Reese,
Jr., Vice President in charge of Construction and Design, with terms
substantially similar to the Employment Agreements described above. Mr. Reese
received an initial annual base salary of $150,000, subject to increases as
determined by the Company's Board of Directors from time to time. In addition,
Mr. Reese received options to purchase a total of 25,000 shares of Common
Stock, vesting at a rate of 5,000 options per year, except, in the event of a
change in management, buyout or takeover, all of such options will become
vested. In March 1997, the Company entered into an employment agreement with
James D. Guay, Vice President in charge of Marketing, with terms substantially
similar to the Employment Agreements described above. Mr. Guay received an
initial annual base salary of $160,000, subject to increases as may be
determined by the Company's Board of Directors from time to time. In addition,
Mr. Guay received options to purchase a total of 30,000 shares of Common Stock,
vesting at a rate of 6,000 options per year, except, in the event of a change
in management, buyout or takeover, all of such options will become vested. In
April 1997, the Company entered into an employment agreement with Timothy M.
Hinkley, Senior Vice President of Operations, with terms substantially similar
to the Employment Agreements described above. Mr. Hinkley received an initial
annual base salary of $200,000, subject to increases as may be determined by
the Company's Board of Directors from time to time. In addition, Mr. Hinkley
received options to purchase a total of 10,000 shares of Common Stock, vesting
a rate of 2,000 options per year, except that in the event of a change in
management, buyout or takeover, all of such options will become vested.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Alan Glazer, Robert S. Goldstein and Emanuel Crystal are members of
the Company's Compensation Committee. Mr. Robert S. Goldstein is the son of
Bernard Goldstein, the Chairman and Chief Executive Officer of the Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee advises the Board of Directors concerning
executive compensation, including base salaries, bonuses and the bases for
their award, stock option plans and health, life insurance and other
9
<PAGE>
benefits. Compensation Committee recommendations concerning executive
compensation are reviewed and approved by the Board. Board members who are
also executive officers of the Company do not participate in the deliberations
of the Board concerning their respective compensation and benefits and do not
vote on such matters.
The Company's objective concerning executive compensation is to design an
executive compensation program that attracts and retains qualified executives
and aligns executives' interests with those of the Company and its
stockholders in achieving the Company's operating goals and business
objectives and increasing stockholder value. The principal components of the
Company's executive compensation program are base salary, bonus and stock
options. In light of the Company's objective concerning executive
compensation, a substantial portion of the executive compensation above the
base salary is generally provided through bonuses tied to certain indicators
of Company performance and through the grant of stock options.
The Compensation Committee's determinations of overall executive
compensation for the fiscal year ended April 27, 1997, which includes salary,
bonus, certain benefits and stock option awards, were generally subjective
based upon consideration of, among other factors, the performance of the
Company during the fiscal year, the individual executive officer's
contribution to the achievement of operating goals and business objectives and
levels of compensation in comparable companies at similar stages of
development, with particular emphasis on those operating in the gaming
industry.
Mr. Goldstein serves as CEO at the will of the Board and has not entered
into an employment agreement with the Company. The Board of Directors, with
Mr. Goldstein abstaining from the deliberations, determined to compensate Mr.
Goldstein for his services as CEO with an annual salary of $350,000 for fiscal
1997. This salary level was set based on a general review of compensation
levels of other chief executive officers in comparable companies. Mr.
Goldstein's pro rata portion of salary is paid at the end of each month in
shares of Common Stock, based on the closing price of Common Stock on the 15th
day of that month (or the last preceding trading day if the 15th is a
Saturday, Sunday or holiday). In formulating Mr. Goldstein's bonus and stock
option awards, the Board principally considered Mr. Goldstein's valuable
experience as it relates to leading the Company in its continuing development
of its existing properties and in expansion into new jurisdictions.
Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code")
limits the Company's deduction for compensation paid to the executive officers
named in the Summary Compensation Table to $1 million unless certain
requirements are met. The policy of the Compensation Committee with respect to
section 162(m) is to establish and maintain a compensation program which will
optimize the deductibility of compensation. In that regard, no executive
officer received compensation in excess of $1 million during fiscal 1997. The
Compensation Committee, however, reserves the right to use its judgment, where
merited by the Compensation Committee's need for flexibility to respond to
changing business conditions or by an executive officer's individual
performance, to authorize compensation which may not, in a specific case, be
fully deductible by the Company.
By The Compensation Committee:
Alan J. Glazer
Robert S. Goldstein
Emanuel Crystal
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<PAGE>
STOCK PERFORMANCE GRAPH
The following graph compares the total return on the Company's Common Stock
with the cumulative total return on the Nasdaq Market Index (a broad market
index) and the Dow Jones Entertainment and Leisure--Casinos Index (an industry
index) for the period from August 19, 1992, the date upon which the Common
Stock was registered pursuant to Section 12 of the Exchange Act, through April
27, 1997. The comparison reflects the investment of $100 on August 19, 1992,
and the reinvestment of dividends (if paid), in each of the Company's Common
Stock (for which no dividends have been paid), the NASDAQ Market Index and the
Dow Jones Entertainment and Leisure--Casinos Index. The stock price
performance of the Company reflected in this comparison is not necessarily
indicative of the future stock price performance of the Company's Common
Stock.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG CASINO AMERICA, INC.,
NASDAQ MARKET INDEX AND DOW JONES ENTERTAINMENT AND LEISURE--CASINOS INDEX
LOGO
The performance graph in the Company's proxy statement relating to the 1996
annual meeting of stockholders compared the total return on the Company's
Common Stock with the cumulative total return on the Media General Industry
Group 241--Hotels, Motels and Resorts Index (an industry index). The Company
believes that the Dow Jones Entertainment and Leisure--Casinos Index is a more
appropriate industry index with which to compare the total return on the
Company's Common Stock than is the Media General Industry Group 241--Hotels,
Motels and Resorts Index because the Company believes that the Dow Jones
Entertainment and Leisure--Casinos Index includes companies that more closely
approximate the capitalization and business activities of the Company.
11
<PAGE>
As required by the rules and regulations of the Securities and Exchange
Commission, the following graph compares the total return on the Company's
Common Stock with the cumulative total return on the Media General Industry
Group 241--Hotels, Motels and Resorts Index, for the period from August 19,
1992 through April 27, 1997. For the reasons stated above, the Company does
not presently intend to include a comparison of the total return on the
Company's Common Stock to this index in future proxy statements.
LOGO
12
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CERTAIN TRANSACTIONS
As of August 1, 1997, Allan B. Solomon, the Executive Vice President,
Secretary and General Counsel of the Company, was indebted to the Company in
the aggregate amount of $264,381, payable on demand on 30 days' written notice
or immediately upon the termination of Mr. Solomon's employment with the
Company. Such indebtedness bears interest at the rate of 10% per annum and is
unsecured. The largest aggregate amount of indebtedness of Mr. Solomon to the
Company was $886,000, which amount was subsequently reduced to the level
described above.
In connection with the Company's acquisition of Grand Palais Riverboat, Inc.
("GPRI") on May 3, 1996, Bernard Goldstein, the Chairman and Chief Executive
Officer, and three of his sons (including Robert Goldstein, a director of the
Company) pledged certain of their assets for the issuance of a letter of credit
to secure the repayment of a portion of the principal of certain notes issued
by the Company to effect the acquisition of GPRI. Pursuant thereto, the Company
issued to two of the sons (excluding Robert Goldstein) a five-year warrant to
purchase 12,500 shares of Common Stock at an exercise price of $5.875 per
share.
13
<PAGE>
2. APPROVAL OF THE AMENDMENT TO THE 1993 STOCK OPTION PLAN
Effective as of January 14, 1993, the Casino America 1993 Stock Option Plan
was adopted by the Board and approved by the Company's stockholders on November
17, 1993. The 1993 Plan was adopted to further the growth of the Company and
its subsidiaries by offering an incentive to officers, directors and other key
employees of the Company to continue in the employ of the Company, and to
increase the interest of these individuals in the Company through additional
ownership of its Common Stock.
Initially, 200,000 shares were reserved for issuance under the 1993 Plan,
subject to adjustment for corporate transactions and changes that affect the
Company, its share price or share status. If an award expires unexercised or is
cancelled without being exercised in full, the number of shares of Common Stock
previously reserved for such award will be available for future awards under
the 1993 Plan. Pursuant to the provisions of the 1993 Plan, the number of
shares available for issuance under the Casino America 1992 Stock Option Plan
were adjusted to account for a three-for-two stock dividend distributed in June
1993 and again in April 1994. On August 22, 1994, the Board amended the 1993
Plan to increase the number of shares reserved for issuance to 850,000 shares
and such amendment was approved by the Company's stockholders. On March 5,
1996, the Board amended the 1993 Plan to reserve an additional 350,000 shares
for issuance under the 1993 Plan, and such amendment was approved by the
Company's stockholders. On July 2, 1997, the Board amended the 1993 Plan to
reserve an additional 1,150,000 shares for issuance under the 1993 Plan,
subject to stockholder approval. Pursuant to the provisions of the 1993 Plan,
the Board is submitting the amendment to the 1993 Plan to the stockholders for
approval of the increase in shares of Common Stock available for issuance. The
following summary of the 1993 Plan is qualified in its entirety by reference to
the complete text of the 1993 Plan, which is set forth in Exhibit A to this
Proxy Statement.
GENERAL DESCRIPTION
Participants in the 1993 Plan shall consist of any employee, officer or
director of the Company. Except for mandatory grants to certain directors and
reload options, participants in the 1993 Plan are selected from time to time by
the Board or by a committee of at least two members appointed by the Board to
administer the 1993 Plan (referred to hereinafter as the "1993 Plan
Committee"). The number of shares of Common Stock subject to any stock option
granted under the 1993 Plan is subject to the discretion of the Board or the
1993 Plan Committee.
The Board or the 1993 Plan Committee has the general authority to administer
the 1993 Plan. The Board may amend the 1993 Plan in any respect; provided,
however, that, no amendment which materially increases the number of shares
subject to the 1993 Plan, changes the class of eligible participants, extends
the period during which options may be exercised, changes the provisions
relating to the minimum option price or changes the provisions relating to
termination of options granted under the 1993 Plan may be made without the
approval of the stockholders of the Company. In addition, termination of the
1993 Plan may not adversely affect the rights of any holder of an outstanding
option under the 1993 Plan as of the date of termination.
At June 30, 1997, the Company had approximately 6,000 employees and, at July
31, 1997, approximately 68 employees were participants in the 1993 Plan. As of
July 31, 1997, 1,214,325 shares of Common Stock were subject to outstanding
awards under the 1993 Plan and, after giving effect to the increase approved by
the Board on July 2, 1997, 1,135,675 shares remained available for issuance.
The closing price per share of Common Stock on July 31, 1997 was $2.25, as
reported on the Nasdaq National Market.
AWARDS UNDER THE 1993 PLAN
In General. Options to purchase shares of Common Stock of the Company,
including incentive stock options, may be awarded under the 1993 Plan;
provided, however, that incentive stock options may only be granted to
employees of the Company and its subsidiaries. Except for mandatory grants of
stock options to directors who are members of the 1993 Plan Committee and
reload options, each as described below, the Board
14
<PAGE>
or the 1993 Plan Committee will determine the number of shares subject to each
stock option and the manner and time of exercise. No option, however, shall be
exercisable more than 10 years after the date of grant (5 years in the case of
an incentive stock option granted to a ten percent owner) and all outstanding
options will become fully vested upon a Change in Control of the Company (as
defined in the 1993 Plan). Additional rules are set forth in the 1993 Plan for
exercises of stock options in the event of the retirement, disability or death
of employees who are option holders.
Unless otherwise specified by the Board or the 1993 Plan Committee, the per
share option price shall not be less than 100% of the fair market value of a
share of Common Stock at the date of grant; provided, however, that in no
event may the option price for an incentive stock option be less than 100
percent of the fair market value at the date of grant (110 percent in the case
of a ten percent owner). Upon exercise, the option price (and any applicable
withholding taxes) may be paid in cash, in shares of Common Stock having a
fair market value equal to the option price, or in a combination thereof. The
agreement or instrument evidencing the grant of a stock option may contain
such other terms, provisions and conditions not inconsistent with the 1993
Plan as the Board or the 1993 Plan Committee may determine.
Mandatory Grant of Director Options. From and after August 15, 1994, upon
the initial election or appointment of any person to the Board, such director
shall be granted as compensation for serving as a director, options to acquire
22,500 shares of Common Stock. One-half of the options granted to directors
shall vest immediately and one-half of such options shall vest one year from
the date of grant, and shall be granted for a term of five years.
Reload Options. Whenever a participant holding any option outstanding
pursuant to the 1993 Plan exercises the option and makes payment of the
exercise price in whole or in part, by tendering Common Stock previously held
by the participant, then the participant shall automatically be granted a
"Reload Option" with respect to the number of shares of Common Stock that is
equal to the number of shares tendered by the participant on payment of the
option price of the option being exercised. The option price of the Reload
Option shall be an amount equal to the fair market value per share of Common
Stock, determined as of the date of receipt by the Company of the notice by
the participant to exercise the option. The exercise period of the Reload
Option shall expire, and the Reload Option shall no longer be exercisable, on
the later to occur of (i) the expiration date of the originally surrendered
option or (ii) one year from the date of grant of the Reload Option. Any
Reload Option granted shall vest immediately upon grant. All other terms of
the Reload Options granted under the 1993 Plan shall be identical to the terms
and conditions of the original option, the exercise of which gives rise to the
grant of the Reload Option.
Federal Income Tax Consequences of Awards. An optionee generally will not
recognize taxable income upon the grant of a stock option, and neither gain
nor loss will be recognized as a deduction by the Company. Upon the exercise
of a nonqualified stock option, the optionee will recognize ordinary income in
an amount equal to the difference between the option price and the fair market
value of the underlying shares on the date of the exercise, and the Company
generally will be entitled to a deduction for the amount recognized as
ordinary income by the optionee. Generally, an optionee will not be deemed to
have received taxable income upon the exercise of an incentive stock option.
Any gain realized upon a disposition of shares received pursuant to the
exercise of an incentive stock option will be taxed as a long-term capital
gain or loss, assuming the optionee holds the shares for at least two years
after the date of grant and for at least one year after the date of exercise.
If shares of Common Stock acquired upon the exercise of an incentive stock
option are disposed of prior to satisfaction of the holding periods described
above, the optionee will generally recognize ordinary income, and the Company
will be allowed to deduct an amount, equal to lesser of (i) the excess of the
market value of the shares at the date of exercise over the option price or
(ii) the excess of the amount realized upon disposition of the shares over the
option price. If an optionee pays the exercise price of any option by delivery
of shares of Common Stock, the exchange of shares generally will be treated as
a non-taxable transaction (provided, in the case of an incentive stock option,
that the shares delivered in payment are not shares acquired upon exercise of
an incentive stock option which has not satisfied the holding period
requirements discussed above).
15
<PAGE>
CASINO AMERICA 1993 STOCK OPTION PLAN FISCAL 1997 AWARDS
No decision has yet been made regarding total awards under the 1993 Plan for
fiscal 1998 or subsequent years. During fiscal 1997, options to acquire
152,500 shares were awarded to all employees as a group (excluding executive
officers), at a weighted average exercise price of $3.06 per share and an
expiration date of November 22, 2005, and 527,500 shares were awarded to all
eligible participants in the 1993 Plan at a weighted average exercise price of
$3.46 per share and expiration dates ranging from March 4, 2001 to November
22, 2005.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR APPROVAL OF
THE AMENDMENT TO THE 1993 STOCK OPTION PLAN.
3. APPROVAL OF SELECTION OF AUDITORS
Unless marked to the contrary, proxies will be voted for the selection of
Ernst & Young as the Company's independent auditors for the fiscal year ending
on April 26, 1998. Ernst & Young was engaged as the Company's independent
auditors effective June 1993 and has audited the Company's consolidated
financial statements for the years ended April 30, 1993, April 30, 1994, April
30, 1995, April 30, 1996 and April 27, 1997.
Representatives of Ernst & Young are expected to appear at the Annual
Meeting, will have an opportunity to make a statement, if they wish to do so,
and will be available to answer appropriate questions from stockholders at
that time.
The firm of McGladrey & Pullen had previously served as the Company's
auditors from June 8, 1992 until June 1993, at which time pursuant to a
recommendation of the Board, they were dismissed. McGladrey & Pullen's report
on the financial statements of the Company for each of the years ended
December 31, 1991 and 1990, and for the four-month period ended April 30,
1992, did not contain an adverse opinion or disclaimer of opinion and was not
qualified or modified as to uncertainty, audit scope, or accounting
principles. Through the date of dismissal, there were no disagreements with
McGladrey & Pullen on any matters of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure. Furthermore,
there were no "reportable events," as defined in Item 304(a)(1)(v) of
Regulation S-K promulgated by the Commission, through the date of dismissal.
If the selection of Ernst & Young is not approved by the stockholders, the
Board will consider such a vote as advice to select other independent
accountants for fiscal 1999, rather than fiscal 1998, because of the
difficulty and expense involved in changing independent accountants on short
notice.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
SELECTION OF ERNST & YOUNG AS THE COMPANY'S INDEPENDENT AUDITORS.
OTHER MATTERS
The Board of Directors is not aware of any other business that may come
before the Annual Meeting. However, if additional matters properly come before
the meeting, proxies will be voted at the discretion of the proxy-holders.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 1998 Annual Meeting of
Stockholders must be received by the Company not later than June 19, 1998, at
its principal executive offices, Attention: Bernard Goldstein, Chairman and
Chief Executive Officer, in order to be considered for inclusion in the
Company's proxy statement and form of proxy relating to that annual meeting.
16
<PAGE>
ADDITIONAL INFORMATION
A copy of the Company's Annual Report to Stockholders for fiscal 1997 is
being provided to stockholders with this Proxy Statement.
By Order of the Board of Directors,
Bernard Goldstein, Chairman and
Chief Executive Officer
August 25, 1997
Biloxi, Mississippi
17
<PAGE>
EXHIBIT A
CASINO AMERICA, INC.
1993 STOCK OPTION PLAN
AS AMENDED, JULY 2, 1997
1. PURPOSE OF THE PLAN
The purpose of this Plan is to further the growth of Casino America, Inc.,
("Casino") and its Subsidiaries (Casino and its Subsidiaries together being
the "Company"), by offering an incentive to officers, directors and other key
employees of the Company to continue in the employ of the Company, and to
increase the interest of these employees in Casino, through additional
ownership of its common stock.
2. DEFINITIONS
Whenever used in this Plan, the following terms shall have the meanings set
forth in this Section:
(a) "Board of Directors" means the Board of Directors of Casino.
(b) "Change of Control" means the acquisition by any person or group (as
that term is defined in the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and the rules promulgated pursuant to that act) in a
single transaction or a series of transactions of 30% or more in voting
power of the outstanding stock of Casino and a change of the composition of
the Board of Directors so that, within two years after the acquisition took
place, a majority of the members of the Board of Directors of Casino, or of
any corporation with which Casino may be consolidated or merged, are
persons who were not directors or officers of Casino or one of its
Subsidiaries immediately prior to the acquisition, or to the first of a
series of transactions which resulted in the acquisition of 30% or more in
voting power of the outstanding stock of Casino.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the committee referred to in Section 5.
(e) "Common Stock" means the common stock, par value $.01 per share, of
Casino.
(f) "Corporate Transaction" means any (i) reorganization or liquidation
of Casino, (ii) reclassification of Casino's capital stock, (ii) merger of
Casino with or into another corporation, or (iv) the sale of all or
substantially all the assets of Casino, which results in a significant
number of Employees being transferred to a new employer or discharged or in
the creation or severance of a parent-subsidiary relationship.
(g) "Date of Grant" means, as the case may be: (i) the date fixed in this
Plan for mandatory grants of Options; (2) the date the Committee approves
the grant of an Option pursuant to this Plan; or (3) such later date as may
be specified by the Committee as the date a particular Option granted
pursuant to this Plan will become effective.
(h) "Exercise Price" means the price per share which must be paid upon
exercise of an Option. The Exercise Price may be paid in cash, property
(including Common Stock) or a combination of both cash and property, as
determined by the Employee upon exercise of the Option and as set forth in
Section 9(c) hereof.
(i) "Fair Market Value" means: (i) if the Common Stock is traded in a
market in which actual transactions are reported, the mean of the high and
low prices at which the Common Stock is reported to have traded on the
relevant date in all markets on which trading in the Common Stock is
reported or, if there is no reported sale of the Common Stock on the
relevant date, the mean of the highest reported bid price and lowest
reported asked price for the Common Stock on the relevant date; (ii) if the
Common Stock is Publicly Traded but only in markets in which there is no
reporting of actual transactions, the mean of the highest reported bid
price and the lowest reported asked price for the Common Stock on the
relevant date; or (iii) if the Common Stock is not Publicly Traded, the
value of a share of Common Stock as determined by the most recent valuation
prepared by an independent expert at the request of the Committee.
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(j) "Incentive Stock Option" means any Option which, at the time of the
grant, is an incentive stock option within the meaning of Section 422 of
the Code.
(k) "Non-Qualified Option" means any Option that is not an Incentive
Stock Option pursuant to the terms of this Plan.
(l) "Option" means any option granted pursuant to this Plan, including
any Reload Options as defined herein.
(m) "Participant" means any person employed by the Company within the
meaning of Section 3401(c) of the Code and the regulations promulgated
thereunder; and any officer or director of the Company even if he is not an
employee within the meaning of the first clause of this subsection.
(n) "Publicly Traded" means that a class of stock is required to be
registered pursuant to Section 12 of the Exchange Act, or that stock of
that class has been sold within the preceding 12 months in an underwritten
public offering, or stock that is regularly traded in a public market.
(o) "Reload Option" means an Option granted to a Participant equal to the
number of shares of already owned Common Stock delivered by the Participant
to pay for the exercise of an Option, as more fully described in Section 15
below.
(p) "Retirement" means a Termination of Employment by reason of a
Participant's retirement at a time when the Participant is at least 65
years old, other than by reason of a termination by resignation, discharge,
death or Total Disability or the resignation, failure to stand for re-
election or dismissal from the Board of Directors.
(q) "Subsidiary" means any corporation that is a subsidiary with regard
to Casino as that term is defined in Section 424(f) of the Code.
(r) "Termination of Employment" means the time when the employee-employer
relationship between an employee-Participant and the Company ceases to
exist for any reason including, but not limited to, a termination by
resignation, discharge, death, Total Disability or Retirement or the
resignation, failure to stand for re-election or dismissal from the Board
of Directors.
(s) "Total Disability" means the inability of a Participant to perform
the material duties of his or her job by reason of a medically determinable
physical or mental impairment that can be expected to result in death or
that has lasted or can be expected to last for a continuous period of not
less than 12 months. All determinations as to the date and extent of
disability of a Participant will be made in accordance with the written
policy pertaining to Participant disability, if any, of the Company by
which an employee-Participant is employed. In the absence of a written
policy pertaining to Participant disability, all determinations as to the
date and extent of disability of a Participant will be made by the
Committee in its sole and absolute discretion. In making its determination,
the Committee may consider the opinion of the personal physician of the
Participant or the opinion of an independent licensed physician of the
Company's choosing.
3. EFFECTIVE DATE OF THE PLAN
The "Effective Date" of this Plan is January 14, 1993. This Plan shall
become effective on the Effective Date, subject to approval of the Plan not
later than 12 months from the Effective Date, by the affirmative vote of the
holders of a majority of the shares of voting stock of Casino present, or
represented, and entitled to vote at a meeting duly held in accordance with
the laws of the State of Delaware. The Plan was approved by the shareholders
of Casino on November 17, 1993.
4. ADMINISTRATION OF THE PLAN
The Committee shall be responsible for the administration of this Plan, and
shall grant Options pursuant to this Plan. Subject to the express provisions
of this Plan, the Committee shall have full authority to interpret this Plan,
to prescribe, amend and rescind rules and regulations relating to it, and to
make all other determinations which it believes to be necessary or advisable
in administering this Plan. The determinations of the Committee
A-2
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on the matters referred to in this Section shall be conclusive. The Committee
may not amend this Plan. No member of the Committee shall be liable for any
act or omission in connection with the administration of this Plan unless it
resulted from the member's willful misconduct.
5. THE COMMITTEE
The Committee shall be the Board of Directors of Casino or a committee of
the Board consisting of not fewer that two members of the Board of Directors.
Unless the Board of Directors appoints a Committee, the Board of Directors
itself shall be the Committee. If the Committee is the Board of Directors, it
shall hold meetings and act as provided in Casino's bylaws. If the Committee
is other than the Board of Directors: (a) the Committee shall hold its meeting
at such times and places as it may determine and shall maintain written
minutes of its meetings; (b) a majority of the members of the Committee shall
constitute a quorum at any meeting of the Committee; (c) all determinations of
the Committee shall be made by the vote of a majority of the members who
participate in a meeting; (d) the members of the Committee may participate in
a meeting of the Committee in person or by conference telephone or similar
communications equipment by means of which all members can hear each other;
and (e) any decision or determination by written consent of all of the members
of the Committee shall be as effective as if it had been made by a vote of a
majority of the members who participate in a meeting.
6. STOCK SUBJECT TO THE PLAN
From and after July 2, 1997, the maximum number of shares of Common Stock as
to which Options may be granted pursuant to this Plan is Two Million Three
Hundred Fifty Thousand (2,350,000) shares. The maximum number of shares of
such Common Stock shall be reduced each year by the required or discretionary
grant of Options as provided herein (including Reload Options as described in
Section 15 below). If any Option expires or is canceled without being
exercised in full, the number of shares as to which the Option is not
exercised will once again become shares as to which new Options may be
granted. The Common Stock that is issued on exercise of Options may be
authorized but unissued shares or shares that have been issued and reacquired
by Casino.
7. PERSONS ELIGIBLE TO RECEIVE OPTIONS
Options may be granted only to Participants, as defined in Section 2(m)
above.
8. GRANTS OF OPTIONS
(a) In General. Except as otherwise provided herein (including but not
limited to subsection (b) of this Section 8 and Section 15 hereof, pertaining
to Reload Options), the Committee shall have complete discretion to determine
when and to which Participants Options are to be granted, the number of shares
of Common Stock as to which Options granted to each Participant will relate,
whether Options granted to a Participant will be Incentive Stock Options or
Non-Qualified Options or partly Incentive Stock Options and partly Non-
Qualified Options and, subject to the limitations in Sections 9 and 10 below,
the Exercise Price and the term of Options granted to a Participant. Any
Options that are not designated as Incentive Stock Options when they are
granted shall be Non-Qualified Options. No grant of an Incentive Stock Option
may be conditioned upon a Non-Qualified Option's having yet been exercised in
whole or in part, and no grant of a Non-Qualified Option may be conditioned
upon an Incentive Stock Option's having not been exercised in whole or in
part. Notwithstanding the foregoing, directors who are members of the
Committee shall not receive options pursuant to the Plan other than pursuant
to subsection (b) below, so long as they are serving on the Committee, and may
not have received options pursuant to the Plan other than pursuant to
subsection (b) below, or pursuant to any other plan of the Company, during the
twelve month period immediately prior to their becoming a member of the
Committee.
(b) Mandatory Grant of Director Options. From and after August 15, 1994,
upon the initial election or appointment of any person to the Board of
Directors of Casino, such director shall be granted (whether or not he or she
would otherwise be a Participant, as defined in Section 2(m) hereof) as
compensation for serving as a
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director, Options to acquire Twenty-Two Thousand Five Hundred (22,500) shares
of Common Stock. Notwithstanding any vesting provisions provided elsewhere in
this Plan or in the Stock Option Agreement, one-half of the Options granted to
directors hereunder shall vest immediately and one-half of such Options shall
vest one year from the Date of Grant, and shall be granted for a term of five
years.
9. OPTION PROVISIONS
(a) Exercise Price. The Exercise Price of each Option shall be as determined
by the Committee; provided, however, that in the case of Incentive Stock
Options, the Exercise Price shall not be less than 100% of the Fair Market
Value of the Common Stock on the Date of Grant of the Option; and, provided
further, however, that notwithstanding the foregoing, the Exercise Price of
both Incentive Stock Options and Non-Qualified Options for directors granted
pursuant to Section 8(b) above shall be 100% of the Fair Market Value of the
Common Stock on the Date of Grant of the Option. The Exercise Price of any
Reload Options shall be as determined pursuant to Section 15 of this Plan.
(b) Term. The term of each Option shall be as determined by the Committee,
but in no event shall the term of an Option (whether or not an Incentive Stock
Option) be longer than ten (10) years from the Date of Grant; provided,
however, that the term of any Reload Options shall be determined as provided
in Section 15 of this Plan.
(c) Manner of Exercise. An Option that has vested pursuant to the terms of
this Plan may be exercised in whole or in part, in increments of a minimum of
100 shares, at any time, or from time to time, during its term. To exercise an
Option, the Participant exercising the Option must deliver to Casino, at its
principal office:
(i) a written notice of exercise of the Option, which states the extent
to which the Option is being exercised and which is executed by the
Participant;
(ii) a certified or bank cashier's check in an amount, or Common Stock
with a Fair Market Value, equal to the Exercise Price of the Option times
the number of shares as to which it is being exercised, or a combination of
the foregoing; and
(iii) a certified or bank cashier's check equal to any withholding taxes
the Company is required to pay as a result of the exercise of the Option by
the Participant.
The day on which Casino receives all of the items specified in this
subsection shall be the date on which the Option is exercised to the extent
described in the notice of exercise.
(d) Delivery of Stock Certificates. As promptly as practicable after an
Option is exercised, Casino shall cause the transfer agent to deliver to the
Participant who exercises the Option certificates, registered in that person's
name, representing the number of shares of Common Stock that were purchased by
the exercise of the Option. Each certificate may, if applicable, bear a legend
to indicate that, the Common Stock represented by the certificate was issued
in a transaction which was not registered pursuant to the Securities Act of
1933, as amended (the "Act"), and may only be sold or transferred in a
transaction that is registered pursuant to the Act or is exempt from the
registration requirements of the Act.
(e) Vesting of Options. Except as otherwise provided in this Plan, the
Options granted hereunder to Participants shall be subject to such conditions
as to vesting as shall be determined by the Committee, in its sole and
absolute discretion, at the Date of Grant of the Option, and the terms of such
vesting shall be clearly set forth in the instrument granting the Option;
provided, however, that upon a Change of Control, any Options that have not
yet vested in accordance with the terms of this Plan and the Stock Option
Agreement shall vest upon such Change of Control. An Option shall "vest" at
such time as it becomes exercisable in accordance with this Plan and the Stock
Option Agreement. Upon exercise of an Option and the delivery of the stock
certificates as provided herein, the Common Stock acquired upon exercise of
the Option shall not be subject to forfeiture by the Participant for any
reason whatsoever. Notwithstanding any of the foregoing, an officer, director
or person who beneficially owns ten percent (10%) or more of the Common Stock
(including Options to acquire Common
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Stock) shall not sell or otherwise dispose of Common Stock acquired upon
exercise of an Option granted hereunder until at least six months shall elapse
from latter of (i) the Effective Date of the Plan, or (ii) the Date of Grant
of the Option to the date of sale or other disposition of the Common Stock
acquired upon exercise of the Option.
(f) Nontransferability of Options. During the lifetime of a person to whom
an Option is granted pursuant to this Plan, the Option may be exercised only
by that person or by his or her guardian or legal representative. An Option
may not be assigned transferred, sold, pledged or hypothecated in any way;
shall not be subject to levy or execution or disposition under the Bankruptcy
Code of 1978, as amended, or any other state or federal law granting relief to
creditors, whether now or hereafter in effect; and shall not be transferable
otherwise than by will or the laws of descent and distribution. Casino will
not recognize any attempt to assign, transfer, sell, pledge, hypothecate or
otherwise dispose of an Option contrary to the provisions of this Plan, or to
levy an attachment, execution or similar process upon any Option and, except
as expressly stated in this Plan, Casino shall not be required to, and shall
not, issue Common Stock on the exercise of an Option to anyone who claims to
have acquired that Option from the person to whom it was granted in violation
of this subsection.
(g) Retirement of Holder of Option. If there is a Termination of Employment
of an employee-Participant to whom an Option has been granted due to
Retirement, each Incentive Stock Option held by the retired Participant,
whether or not then vested, may be exercised until the earlier of: (x) the end
of the three (3) month period immediately following the date of such
Termination of Employment; or (y) the expiration of the term specified in the
Option. In the case of a Non-Qualified Option, there shall be substituted the
words, "the end of the twelve (12) month period" for the words "the end of the
three (3) month period" in the immediately preceding sentence.
(h) Total Disability of Holder of Option. If there is a Termination of
Employment of an employee-Participant to whom an Option has been granted by
reason of his or her Total Disability, each Option held by the Participant,
whether or not then vested, may be exercised until the earlier of: (x) the end
of the twelve (12) month period immediately following the date of such
Termination of Employment; or (y) the expiration of the term specified in the
Option.
(i) Death of Holder of Option. If there is a Termination of Employment of a
Participant to whom an Option has been granted by reason of (i) his or her
death, or (ii) the death of a former Participant within three (3) months
following the date of his or her Retirement (or, in the case of a Non-
Qualified Option, within twelve (12) months following the date of his or her
Retirement), or (iii) the death of a former Participant within twelve (12)
months following the date of his or her Termination of Employment by reason of
Total Disability, then each Option held by the person at the time of his or
her death, whether or not then vested, may be exercised by the person or
persons to whom the Option shall pass by will or by the laws of descent and
distribution (but by no other persons) until the earlier of: (x) the end of
the twelve (12) month period immediately following the date of death (or such
longer period as is permitted by the Committee); and (y) the expiration of the
term specified in the Option, provided, however, that in no event is the term
of the Option to be deemed to expire prior to the end of three (3) months from
the date of death of the Participant.
(j) Termination of Employment Other Than for Retirement, Death or
Disability. If there is a Termination of Employment of an employee-Participant
to whom an Option has been granted pursuant to this Plan for any reason other
than the Retirement, death or Total Disability of the employee-Participant,
then all Options held by such employee-Participant which are then vested may
be exercised until the earlier of: (x) the three (3) month period immediately
following the date of such Termination of Employment; or (y) the expiration of
the term specified in the Option.
(k) Stock Option Agreement. As promptly as practicable after a Participant
is granted an Option pursuant to this Plan, the Committee shall send the
Participant a document setting forth the terms and conditions of the grant.
The form of grant document shall be substantially as set forth in Exhibit "A"
attached hereto. Each Option granted pursuant to this Plan must be clearly
identified as to whether it is or is not an Incentive Stock Option
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and shall set forth all other terms and conditions relating to the exercise
thereof. In the case of an Incentive Stock Option, the document shall include
all terms and provisions that the Committee determines to be necessary or
desirable in order to qualify the Option as an Incentive Stock Option within
the meaning of Section 422 of the Code. If a Participant is granted an
Incentive Stock Option and a Non-Qualified Option at the same time, the
Committee shall end the Participant a separate document relating to each of
the Incentive Stock Option and the Non-Qualified Option.
10. SPECIAL PROVISIONS RELATING TO INCENTIVE STOCK OPTIONS
No Incentive Stock Option may be granted pursuant to this Plan after ten
(10) years from the first to occur of: (i) the date this Plan is adopted by
the Board of Directors; or (ii) the date this Plan is approved by the
stockholders of Casino. No Incentive Stock Option may be exercised after the
expiration of ten (10) years from the Date of Grant or such shorter period as
is provided herein. Notwithstanding Sections 8(b) and 15 hereof, Incentive
Stock Options may not be granted to a Participant who, at the time the Option
is granted, owns more than ten percent (10%) of the total combined voting
power of the stock of Casino, unless: (i) the purchase price of the Common
Stock pursuant to the Incentive Stock Option is at least one hundred ten
percent (110%) of the Fair Market Value of the Common Stock on the Date of
Grant; and (ii) the Incentive Stock Option by its terms is not exercisable
after the expiration of five (5) years from the Date of Grant. The Committee
is authorized, pursuant to the last sentence of Section 422(b) of the Code, to
provide at the time an Option is granted, pursuant to the terms of such
Option, that such Option shall not be treated as an Incentive Stock Option
even though it would otherwise qualify as an Incentive Stock Option. The terms
of any Incentive Stock Option granted hereunder shall, in the hands of any
individual grantee thereof, be subject to the dollar limitations set forth in
Section 422(d) of the Code (pertaining to the $100,000 per year limitation).
11. RECAPITALIZATION
(a) In General. If Casino increases the number of outstanding shares of
Common Stock through a stock dividend or a stock split, or reduces the number
of outstanding shares of Common Stock through a combination of shares or
similar recapitalization then, immediately after the record date for the
change: (i) the number of shares of Common Stock issuable on the exercise of
each outstanding Option granted pursuant to this Plan (whether or not then
vested) shall be increased in the case of a stock dividend or a stock split,
or decreased in the case of a combination or similar recapitalization that
reduces the number of outstanding shares, by a percentage equal to the
percentage change in the number of outstanding shares of Common Stock as a
result of the stock dividend, stock split, combination or similar
recapitalization; (ii) the Exercise Price of each outstanding Option granted
pursuant to this Plan (whether or not then vested) shall be adjusted so that
the total amount to be paid upon exercise of the Option in full will not
change; and (iii) the number of shares of Common Stock that may be issued on
exercise of Options granted pursuant to this Plan (whether or not then vested)
and that are outstanding or remain available for grant shall be increased or
decreased by a percentage equal to the percentage change in the number of
outstanding shares of Common Stock.
(b) Corporate Transactions. If, as a result of a Corporate Transaction while
an Option granted pursuant to this Plan is outstanding (whether or not then
vested), and the holders of the Common Stock become entitled to receive, with
respect to their Common Stock, securities or assets other than, or in addition
to, their Common Stock, then upon exercise of that Option the holder shall
receive what the holder would have received if the holder had exercised the
Option immediately before the first Corporate Transaction that occurred while
the Option was outstanding and as if the Company had not disposed of anything
the holder would have received as a result of that and all subsequent
Corporate Transactions. Casino shall not agree to any Corporate Transaction
unless the other party to the Corporate Transaction agrees to make available,
on exercise of the Options granted pursuant to this Plan that are outstanding
at the time of the Corporate Transaction, the securities or other assets the
holders of those Options are entitled pursuant to this subsection to receive.
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12. RIGHTS OF OPTION HOLDER
(a) Stockholder. The holder of an Option (whether or not then vested) shall
not have any rights as a stockholder by reason of holding that Option. Upon
exercise of an Option granted pursuant to this Plan, the holder shall be
deemed to acquire the rights of a stockholder when, but not before, the
issuance of Common Stock as a result of the exercise is recorded in the stock
transfer records of Casino.
(b) Employment. Nothing in this Plan or in the grant of an Option shall
confer upon any Participant the right to continue in the employ of the Company
or shall interfere with or restrict in any way the rights of the Company to
discharge any Participant at any time for any reason whatsoever, with or
without cause.
13. LAWS AND REGULATIONS
The obligation of Casino to sell and deliver shares of Common Stock on
vesting and exercise of Options granted pursuant to this Plan shall be subject
to the condition that counsel for Casino be satisfied that the sale and
delivery thereof will not violate the Act or any other applicable laws, rules
or regulations. In addition, the Company may, as a condition to such sale and
delivery, require the Participant to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for Casino, such a representation is required pursuant to
such securities laws.
This Plan is intended to meet the requirements of Rule 16b-3 in order to
provide directors and executive officers with certain exemptions from the
application of Section 16(b) of the Exchange Act.
14. WITHHOLDING OF TAXES
(a) In General. In addition to the requirement set forth in Section 9(c)
above that, in order to exercise an Option granted pursuant to this Plan, a
person must make a payment to Casino or authorize withholding in order to
enable the Company to pay any withholding taxes due as a result of the
exercise of that Option, if an employee-Participant who exercised an Incentive
Stock Option disposes of shares of Common Stock acquired through exercise of
that Incentive Stock Option either (x) within two years after the Date of
Grant of the Incentive Stock Option or (y) within one year after the issuance
of the shares on exercise of the Incentive Stock Option then, promptly
thereafter, the Participant shall notify the Company of the occurrence of the
event and the amount realized upon the disposition of such Common Stock by the
Participant, and pay any federal, state and other taxes due as a result
thereof.
(b) Withholding of Taxes. If, whether because of a disposition of Common
Stock acquired on exercise of an Incentive Stock Option, the exercise of a
Non-Qualified Option or otherwise, the Company becomes required to pay
withholding taxes to any federal, state or other taxing authority and the
employee-Participant fails to provide the Company with the funds with which to
pay that withholding tax, then the Company may withhold, subject to applicable
state law, up to fifty percent (50%) of each payment of salary or bonus to the
Participant (which will be in addition to any other required or permitted
withholding), until the Company has been reimbursed for the entire withholding
tax it was required to pay.
15. RELOAD OPTIONS
(a) Grant. Whenever a Participant holding any Option outstanding pursuant to
this Plan (including Reload Options previously granted pursuant to this
Section 15) exercises the Option and makes payment of the Exercise Price
pursuant to Section 9(c)(ii) hereof, in whole or in part, by tendering Common
Stock previously held by the Participant, then the Company shall grant to the
Participant a Reload Option for the number of shares of Common Stock that is
equal to the number of shares tendered by the Participant on payment of the
Exercise Price of the Option being exercised.
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(b) Reload Option Exercise Price. Subject to Section 10 hereof, the Reload
Option Exercise Price per share shall be an amount equal to the Fair Market
Value per share of the Company's Common Stock, determined as of the date of
receipt by the Company of the notice by the Participant to exercise the
Option.
(c) Term of Reload Option. Subject to Section 10 hereof, the exercise period
of the Reload Option shall expire, and the Reload Option shall no longer be
exercisable, on the later to occur of (i) the expiration date of the
originally surrendered Option or (ii) one year from the date of grant of the
Reload Option.
(d) Restriction on Exercise. Any Reload Option granted pursuant to this
Section 15 shall vest immediately upon grant pursuant to Subsection (a) above.
(e) Other Terms of Reload Options. All other terms of the Reload Options
granted hereunder shall be identical to the terms and conditions of the
original Option, the exercise of which gives rise to the grant of the Reload
Option.
16. RESERVATION OF SHARES
Casino shall at all times keep reserved for issuance on exercise of Options
granted pursuant to this Plan a number of authorized but unissued or
reacquired shares of Common Stock equal to the maximum number of shares Casino
may be required to issue on exercise of outstanding Options (whether or not
then vested) granted pursuant to this Plan.
17. AMENDMENT OF THE PLAN
The Board of Directors may, at any time and from time to time, modify or
amend this Plan in any respect effective at any date the Board of Directors
determines; provided, however, that, without the approval of the stockholders
of Casino the Board of Directors may not: (i) increase the maximum number of
shares of Common Stock that may be issued on exercise of Options (whether or
not then vested) granted pursuant to this Plan; (ii) change the categories of
Participants eligible to receive Options; (iii) extend the period during which
Options (whether or not then vested) may be exercised; (iv) change the
provisions fixing the minimum Exercise Price; or (v) change the provisions as
to termination of Options. No modification or amendment of this Plan shall,
without the consent of the holder of an outstanding Option (whether or not
then vested), adversely affect the holder's rights pursuant to that Option.
18. TERMINATION OF THE PLAN
The Board of Directors may suspend or terminate this Plan at any time or
from time to time, but no such action shall adversely affect the rights of a
person holding an outstanding Option, whether or not then vested, granted
pursuant to this Plan prior to that date.
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CASINO AMERICA, INC.
PROXY
SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING TO BE HELD SEPTEMBER
25, 1997
The undersigned hereby appoints Bernard Goldstein, John M. Gallaway and Allan
B. Solomon, and each of them, the proxy or proxies of the undersigned with full
power of substitution to vote all shares of the common stock of Casino America,
Inc., a Delaware corporation (the "Company"), that the undersigned is entitled
to vote at the Annual Meeting of Stockholders of the Company to be held on
September 25, 1997, or adjournments thereof, with all powers the undersigned
would possess if personally present, on the following as specified and, in
their discretion, on such other matters as may properly come before the meeting
Proposal 1: Elect Directors.
Bernard Goldstein John M. Gallaway
Allan B. Solomon Robert S. Goldstein
Alan J. Glazer Emanuel Crystal
Randolph Baker
[_] FOR All Nominees listed above (except as marked to the contrary
below)
[_] WITHHOLD AUTHORITY to vote for
All Nominees listed above
- - - --------------------------------------------------------------------------------
(To withhold your vote for any nominee or nominees, print the name(s) above.)
Proposal 2: Approve Amendment to the Company's 1993 Stock Option Plan.
[_] FOR [_] AGAINST [_] ABSTAIN
(Please sign on reverse side.)
<PAGE>
Proposal 3: Ratify Selection of Ernst & Young as Independent Auditors.
[_] FOR [_] AGAINST [_] ABSTAIN
When properly executed, this proxy will be voted as directed. If no direction
is given, this proxy will be voted FOR Proposals 1, 2 and 3 in the discretion
of the proxies nominated hereby on any other business as may properly come
before the meeting.
Please sign exactly as name appears
below.
Dated: _____________________ , 1997
-----------------------------------
Signature
-----------------------------------
Signature, if held jointly
Please sign exactly as your name
appears on this Proxy. If shares
are registered in more than one
name, the signatures of all such
holders are required. A
corporation should sign in its
full corporate name by a duly
authorized officer, stating such
officer's title and official
capacity, giving the full title as
such. A partnership should sign in
the partnership name by an
authorized person, stating such
person's title and relationship to
the partnership.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY, USING THE ENCLOSED
ENVELOPE.
