<PAGE>
FORM 8 - A/A - 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
Argosy Gaming Company
(Exact name of registrant in its charter)
Delaware 37-1304247
(State of incorporation or organization) (I.R.S. Employer
Identification No.)
219 Piasa Street, Alton, Illinois 62002
(Address of principal executive offices) (Zip Code)
-------------------------------------------
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
------------------- ------------------------------
12% Convertible New York Stock Exchange
Subordinated Notes
Due 2001
Securities to be registered pursuant to Section 12(g) of the Act:
None
(Title of Class)
<PAGE>
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES
TO BE REGISTERED
The description of the 12% Convertible Subordinated Notes due 2001 (the
"Notes") of Argosy Gaming Company (the "Company") contained in the Company's
Post-Effective Amendment No. 2 to Registration Statement on Form S-3 (No. 33-
76456) (the "Registration Statement"), filed with the Securities and Exchange
Commission on May 27, 1994, under the heading "DESCRIPTION OF NOTES" on pages 58
through 67 of the Preliminary Prospectus contained therein is hereby
incorporated by reference pursuant to Rule 12b - 23 of the Securities Exchange
Act of 1934.
ITEM 2. EXHIBITS
1. All exhibits required by Instruction II to Item 2 will be supplied to
the New York Stock Exchange.
2. "DESCRIPTION OF NOTES" pages from Registration Statement.<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereto duly authorized.
ARGOSY GAMING COMPANY
Registrant
By: /s/ Joseph G. Uram
Its: Chief Financial Officer
Dated: June 25, 1996
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EXHIBIT 2
DESCRIPTION OF THE NOTES
The Notes will be issued pursuant to an indenture (the "Indenture") to be
dated as of June 6, 1994, by and between the Company and Bank One, Springfield,
as trustee (the "Trustee"). The following summary of the Notes and the Indenture
does not purport to be complete and is subject to, and is qualified in its
entirety by, reference to, all of the provisions of the Notes and the Indenture,
copies of which have been filed as exhibits to the Registration Statement of
which this Prospectus constitutes a part. The terms of the Indenture are also
governed by certain provisions contained in the Trust Indenture Act of 1939, as
amended. Capitalized terms used herein without definition have the meanings
ascribed to them in the Indenture. As used in this section, "the Company" refers
to Argosy Gaming Company, exclusive of its subsidiaries. Wherever particular
provisions of the Indenture are referred to in this summary, such provisions are
incorporated by reference as a part of the statements made and such statements
are qualified in their entirety by such reference.
GENERAL
The Notes will be unsecured, subordinated, general obligations of the
Company, limited in aggregate principal amount to $100,000,000 ($115,000,000 if
the Underwriters' overallotment option is exercised in full). The Notes will be
subordinated in right of payment to all Senior Indebtedness of the Company, as
described under "Subordination," below. The Notes will be issued only in fully
registered form, without coupons, in denominations of $1,000 and integral
multiples thereof.
The Notes will mature on June 1, 2001. The Notes will bear interest at the
rate per annum stated on the cover page hereof from the date of issuance or from
the most recent Interest Payment Date to which interest has been paid or
provided for, payable semi-annually on June 1 and December 1 of each year,
commencing December 1, 1994, to the persons in whose names such Notes are
registered at the close of business on the May 15 or November 15 immediately
preceding such Interest Payment Date. Interest will be calculated on the basis
of a 360-day year consisting of twelve 30-day months.
Principal or, premium, if any, and interest on the Notes will be payable, the
Notes will be convertible and the Notes may be presented for registration of
transfer or exchange, at the office or agency of the Company maintained for such
purpose, which office or agency shall be maintained in the Borough of Manhattan,
The City of New York. At the option of the Company, payment of interest may be
made by check mailed to the Holders of the Notes at the addresses set forth upon
the registry books of the Company. No service charge will be made for any
registration of transfer or exchange of Notes, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. Until otherwise designated by the Company, the
Company's office or agency will be the corporate trust office of the Trustee
presently located at New York, New York.
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EXHIBIT 2
The covenants and provisions contained in the Indenture and the Notes would
not necessarily afford the holders of the Notes protection in the event of a
highly leveraged transaction involving the Company, including a leveraged
transaction initiated or supported by the Company, the management of the Company
or any affiliate of either party.
CONVERSION RIGHTS
The Holder of any Notes will have the right, at the Holder's option, to
convert any portion of the principal amount thereof that is an integral multiple
of $1,000 into shares of Common Stock at any time prior to maturity (unless
earlier redeemed or repurchased) at the Conversion Price set forth on the cover
page hereof (subject to adjustment as described below). The right to convert a
Note called for redemption or delivered for repurchase will terminate at the
close of business on the fifth or second Business Day, respectively, prior to
the Redemption Date or Repurchase Date for such Note, unless the Company
subsequently fails to pay the applicable Redemption Price.
In the case of any Note which has been converted after any Record Date, but
on or before the next Interest Payment Date, interest the stated due date of
which is on such Interest Payment Date shall be payable on such Interest Payment
Date notwithstanding such conversion, and such interest shall be paid to the
Holder of such Note who is a Holder on such Record Date. Any Note so converted
must be accompanied by payment of an amount equal to the interest payable on
such Interest Payment Date on the principal amount of Notes being surrendered
for conversion. No fractional shares will be issued upon conversion but, in lieu
thereof, an appropriate amount will be paid in cash by the Company based on the
market price of Common Stock (as determined in accordance with the Indenture) at
the close of business on the day of conversion.
The Conversion Price will be subject to adjustment in certain events,
including: (a) any dividend (and other distributions) payable in Common Stock on
any class of Capital Stock of the Company, (b) any issuance to all holders of
Common Stock of rights, options or warrants entitling them to subscribe for or
purchase Common Stock at less than the then current market price (as determined
in accordance with the Indenture) of Common Stock, (c) any subdivision,
combination or reclassification of Common Stock, (d) any distribution to all
holders of Common Stock of evidences of indebtedness, shares of Capital Stock
other than Common Stock, cash or other assets (including securities, but
excluding those dividends, rights, options, warrants and distributions referred
to above and excluding dividends and distributions paid exclusively in cash),
(e) any distribution consisting exclusively of cash (excluding any cash portion
of distributions referred to in (d) above, or cash distributed upon a merger or
consolidation to which the second succeeding paragraph applies) to all holders
of Common Stock in an aggregate amount that, combined together with (i) all
other such all-cash distributions made within the then preceding 12 months in
respect of which no adjustment has been made and (ii) any cash and the fair
market value of other consideration paid or payable in respect of any tender
offer by the Company or any of its subsidiaries for Common Stock concluded
within the
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EXHIBIT 2
preceding 12 months in respect of which no adjustment has been made, exceeds
12.5% of the Company's market capitalization (defined as being the product of
the then current market price of the Common Stock times the number of shares
of Common Stock then outstanding) on the record date of such distribution,
and (f) the completion of a tender offer made by the Company or any of its
Subsidiaries for Common Stock which involves an aggregate consideration that,
together with (i) any cash and other consideration payable in a tender offer
by the Company or any of its subsidiaries for Common Stock expiring within
the 12 months preceding the expiration of such tender offer in respect of
which no adjustment has been made and (ii) the aggregate amount of any such
all-cash distributions referred to in (e) above to all holders of Common
Stock within the 12 months preceding the expiration of such tender offer in
respect of which no adjustments have been made, exceeds 12.5% of the
Company's market capitalization on the expiration of such tender offer. The
Company reserves the right to make such reductions in the conversion price in
addition to those required in the foregoing provisions as it considers to be
advisable in order that any event treated for Federal income tax purposes as
a dividend of stock or stock rights will not be taxable to the recipients. No
adjustment of the conversion price will be required to be made until the
cumulative adjustments amount to 1.0% or more of the conversion price as last
adjusted.
In the event that the Company distributes rights or warrants (other than
those referred to in (b) in the preceding paragraph) pro rata to holders of
Common Stock, so long as any such rights or warrants have not expired or been
redeemed by the Company, the Holder of any Note surrendered for conversion will
be entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion (the "Conversion Shares"), a number of
rights or warrants to be determined as follows: (i) if such conversion occurs on
or prior to the date for the distribution to the holders of rights or warrants
of separate certificates evidencing such rights or warrants (the "Distribution
Date"), the same number of rights or warrants to which a holder of a number of
shares of Common Stock equal to the number of Conversion Shares is entitled at
the time of such conversion in accordance with the terms and provisions of and
applicable to the rights or warrants, and (ii) if such conversion occurs after
such Distribution Date, the same number of rights or warrants to which a holder
of the number of shares of Common Stock into which such Note was convertible
immediately prior to such Distribution Date would have been entitled on such
Distribution Date in accordance with the terms and provisions of and applicable
to the rights or warrants. The conversion price of the Notes will not be subject
to adjustment on account of any declaration, distribution or exercise of such
rights or warrants.
In case of any reclassification, consolidation or merger of the Company with
or into another Person or any merger of another Person with or into the Company
(with certain exceptions), or in case of any sale, transfer or conveyance of all
or substantially all of the assets of the Company (computed on a consolidated
basis), each Note then outstanding will, without the consent of any Holder of
Notes, become convertible only into the kind and amount of securities, cash and
other property receivable upon such reclassification, consolidation, merger,
sale, transfer or conveyance by a holder of the number of shares of
<PAGE> EXHIBIT 2
Common Stock into which such Note was convertible immediately prior thereto,
after giving effect to any adjustment event, (assuming such holder of Common
Stock failed to exercise any rights of election and received per share the
kind and amount received per share by a plurality of non-electing shares).
If at any time the Company makes a distribution of property to stockholders
that would be taxable to such stockholders as a dividend for Federal income tax
purposes (for example, distributions of assets or evidences of indebtedness of
the Company, but generally not stock dividends or rights to subscribe for Common
Stock), and pursuant to the antidilution provisions of the Indenture, the
Conversion Price is decreased, such decrease may be deemed to result in taxable
dividends to holders of the Notes. See "Certain Federal Income Tax
Considerations."
SUBORDINATION
The Notes are general, unsecured obligations of the Company, subordinated in
right of payment to all existing and future Senior Indebtedness of the Company.
The Notes are structurally subordinated in right of payment to all liabilities
(including trade payables and capitalized lease obligations) of the Company's
subsidiaries. At March 31, 1994, as adjusted to give effect to this offering and
the anticipated use of the net proceeds therefrom, the Company would have no
Senior Indebtedness outstanding. As of such date, the Company's subsidiaries had
approximately $8.7 million of outstanding liabilities.
The Indenture will provide that no payment may be made by the Company on
account of the principal of, premium, if any, or interest on the Notes, or to
acquire any of the Notes (including repurchases of Notes at the option of the
Holder) for cash or property (other than Junior Securities), or on account of
the redemption provisions of the Notes, (i) upon the maturity of any Senior
Indebtedness of the Company by lapse of time, acceleration (unless waived) or
otherwise, unless and until all principal of, premium, if any, and interest on
such Senior Indebtedness are first paid in full, or (ii) in the event of default
in the payment of any principal of, premium, if any, or interest on, any Senior
Indebtedness of the Company when it becomes due and payable, whether at maturity
or at a date fixed for prepayment or by declaration or otherwise (a "Payment
Default"), unless and until such Payment Default has been cured or waived or
otherwise has ceased to exist.
Upon (i) the happening of an event of default (other than a Payment Default)
that permits the holders of Senior Indebtedness or their representative
immediately to accelerate its maturity and (ii) written notice of such event of
default given to the Company and the Trustee by the holders of an aggregate of
$5.0 million principal amount outstanding of such Senior Indebtedness or their
representative (a "Payment Notice"), then, unless and until such event of
default has been cured or waived or otherwise has ceased to exist, no payment
may be made by the Company on account of the principal of, premium, if any, or
interest on the Notes, or to acquire or repurchase any of the Notes for
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EXHIBIT 2
cash or property, or on account of the redemption provisions of the Notes, in
any such case other than payments made with Junior Securities of the Company.
Notwithstanding the foregoing, unless (i) the Senior Indebtedness in respect
of which such event of default exists has been declared due and payable in
its entirety within 179 days after the Payment Notice is delivered as set
forth above (the "Payment Blockage Period"), and (ii) such declaration has
not been rescinded or waived, at the end of the Payment Blockage Period, the
Company shall be required to pay all sums not paid to the Holders of the
Notes during the Payment Blockage Period due to the foregoing prohibitions
and to resume all other payments as and when due on the Notes. Any number of
Payment Notices may be given; PROVIDED, HOWEVER, that (i) not more than one
Payment Notice shall be given within a period of any 360 consecutive days,
and (ii) no default that existed upon the date of such Payment Notice or the
commencement of such Payment Blockage Period (whether or not such event of
default is on the same issue of Senior Indebtedness) shall be made the basis
for the commencement of any other Payment Blockage Period.
In the event that, notwithstanding the foregoing, any payment or distribution
of assets of the Company (other than Junior Securities), shall be received by
the Trustee or the Holders at a time when such payment or distribution is
prohibited by the foregoing provisions, such payment or distribution shall be
held in trust for the benefit of the holders of Senior Indebtedness of the
Company, and shall be paid or delivered by the Trustee or such Holders, as the
case may be, to the holders of the Senior Indebtedness of the Company remaining
unpaid or unprovided for or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing any of such Senior Indebtedness of the Company may have been issued,
ratably according to the aggregate amounts remaining unpaid on account of the
Senior Indebtedness of the Company held or represented by each, for application
to the payment of all Senior Indebtedness of the Company remaining unpaid, to
the extent necessary to pay or to provide for the payment of all such Senior
Indebtedness in full after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness.
Upon any distribution of assets of the Company upon any dissolution, winding
up, total or partial liquidation or reorganization of the Company, whether
voluntary or involuntary, in bankruptcy, insolvency, receivership or a similar
proceeding or upon assignment for the benefit of creditors, (i) the holders of
all Senior Indebtedness of the Company will first be entitled to receive payment
in full before the Holders are entitled to receive any payment on account of the
principal of, premium, if any, and interest on the Notes (other than Junior
Securities) and (ii) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities (other than Junior
Securities) to which the Holders or the Trustee on behalf of the Holders would
be entitled, except for the subordination provisions contained in the Indenture,
will be paid by the liquidating trustee or agent or other person making such a
payment or distribution directly to the holders of Senior Indebtedness of the
Company or their representative to the extent necessary to make payment in full
of all such Senior Indebtedness remaining
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EXHIBIT 2
unpaid, after giving effect to any concurrent payment or distribution to the
holders of such Senior Indebtedness.
No provision contained in the Indenture or the Notes will affect the
obligation of the Company, which is absolute and unconditional, to pay, when
due, principal of, premium, if any, and interest on the Notes. The subordination
provisions of the Indenture and the Notes will not prevent the occurrence of any
Default or Event of Default under the Indenture or limit the rights of the
Trustee or any Holder, subject to the two preceding previous paragraphs, to
pursue any other rights or remedies with respect to the Notes.
As a result of these subordination provisions, in the event of the
liquidation, bankruptcy, reorganization, insolvency, receivership or similar
proceeding or an assignment for the benefit of the creditors of the Company or
any of its Subsidiaries or a marshalling of assets or liabilities of the Company
and its Subsidiaries, holders of the Notes may receive ratably less than other
creditors.
REDEMPTION AT THE COMPANY'S OPTION
The Notes will not be subject to redemption prior to June 1, 1997 and will be
redeemable on such date and thereafter at the option of the Company, in whole or
in part, upon not less than 30 nor more than 60 days' notice to each Holder, at
the following redemption prices (expressed as percentages of the principal
amount) if redeemed during the 12-month period commencing June 1 of the years
indicated below, in each case together with accrued and unpaid interest thereon
to the Redemption Date:
YEAR PERCENTAGE
1997 106.000%
1998 104.000%
1999 102.000%
2000 100.000%
If a Holder or a beneficial owner of a Note or any underlying Common Stock is
required by the Illinois Gaming Board or any other regulatory body responsible
for a Gaming License ("Gaming Authority") to be found suitable, the Holder shall
apply for a finding of suitability within 30 days after a Gaming Authority
request. The applicant for a finding of suitability must pay all costs of the
investigation for such finding of suitability. If a Holder or beneficial owner
is required to be found suitable and is not found suitable by a Gaming
Authority, (i) the Holder shall, to the extent required by applicable law,
dispose of his Notes and underlying Common Stock within 30 days or within that
time prescribed by a Gaming Authority, whichever is earlier, or (ii) the Company
may, at its option, redeem the Holder's Notes at the principal amount thereof,
together with accrued and unpaid interest to the date of the finding of
unsuitability by a Gaming Authority and repurchase the Holder's underlying
Common Stock at the lesser of (x) the market price
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EXHIBIT 2
thereof on the date of the finding of unsuitability or (y) the price at which
such Common Stock was acquired by the Holder.
The Notes will not have the benefit of any sinking fund.
Notice of any redemption will be sent, by first-class mail, at least 30 days
and not more than 60 days prior to the date fixed for redemption (or in the case
of a regulatory redemption described above such earlier date as may be ordered
by the applicable Gaming Authority), to the Holder of each Note to be redeemed
to such Holder's last address as then shown upon the registry books. The notice
of redemption must state the Redemption Date, the Redemption Price and the
amount of accrued interest to be paid. Any notice which relates to a Note to be
redeemed in part only must state the portion of the principal amount equal to
the unredeemed portion thereof and must state that on and after the Redemption
Date, upon surrender of such Note, a new Note or Notes in principal amount equal
to the unredeemed portion thereof will be issued. On and after the Redemption
Date, interest will cease to accrue on the Notes or portions thereof called for
redemption, unless the Company defaults in its obligations with respect thereto
REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER
The Indenture will provide that in the event that a Repurchase Event has
occurred, each holder of Notes will have the right, at such holder's option,
pursuant to an irrevocable and unconditional offer by the Company (the
"Repurchase Offer"), to require the Company to repurchase all or any part of
such holder's Notes (PROVIDED, that the principal amount of such Notes must be
$1,000 or an integral multiple thereof) on the date that is no later than 45
Business Days after the occurrence of such Repurchase Event, at a cash price
(the "Repurchase Offer Price") equal to 101% of the principal amount thereof,
together with accrued and unpaid interest to the Repurchase Date. The Repurchase
Offer shall remain open for 20 Business Days following its commencement and no
longer, except to the extent that a longer period is required by applicable law
(the "Repurchase Offer Period"). Upon expiration of the Repurchase Offer Period,
the Company shall purchase all Notes tendered in response to the Repurchase
Offer.
A Repurchase Event will be deemed to have occurred at such time as:
(1) there is a Change in Control (as defined) of the Company; or
(2) the Company's Common Stock (or other common stock into which the Notes
are then convertible) is not listed for trading on a United States national
securities exchange or the Nasdaq National Market.
The Indenture will provide that a "Change of Control" means (i) any merger or
consolidation of the Company with or into any person or any sale, transfer or
other conveyance, whether direct or indirect, of all or substantially all of the
assets of the Company, on a consolidated basis, in one transaction or a series
of related transactions, if,
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EXHIBIT 2
immediately after giving effect to such transaction, any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the
Exchange Act, whether or not applicable) (other than Excluded Persons) is or
becomes the "beneficial owner," directly or indirectly, of more than 50% of
the total voting power in the aggregate normally entitled to vote in the
election of directors, managers, or trustees, as applicable, of the
transferee or surviving entity, (ii) any "person" or "group" (as such terms
are used for purposes of Sections 13(d) and 14(d) of the Exchange Act,
whether or not applicable) (other than Excluded Persons) is or becomes the
"beneficial owner," directly or indirectly, of more than 50% of the total
voting power in the aggregate normally entitled to vote in the election of
directors, or (iii) during any period of 12 consecutive months after the
Issue Date, individuals who at the beginning of any such 12-month period
constituted the Board of Directors of the Company (together with any new
directors whose election by such Board or whose nomination for election by
the shareholders of the Company was approved by a vote of a majority of the
directors then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved), cease for any reason to constitute a majority of the Board of
Directors of the Company then in office.
On or before the Repurchase Date, the Company will (i) accept for payment
Notes or portions thereof properly tendered pursuant to the Repurchase Offer,
(ii) deposit with the Paying Agent cash sufficient to pay the Repurchase Price
(together with accrued and unpaid interest) of all Notes so tendered and (iii)
deliver to the Trustee Notes so accepted, together with an Officers' Certificate
listing the Notes or portions thereof being purchased by the Company. The Paying
Agent will promptly mail to the Holders of Notes so accepted payment in an
amount equal to the Repurchase Price (together with accrued interest), and the
Trustee will promptly authenticate and mail or deliver to such Holders a new
Note or Notes equal in principal amount to any unpurchased portion of the Notes
surrendered. Any Notes not so accepted will be promptly mailed or delivered by
the Company to the Holder thereof. The Company will publicly announce the
results of the Repurchase Offer on or as soon as practicable after the
Repurchase Date.
The term "all or substantially all of the assets" is likely to be interpreted
by reference to applicable state law at the time applicable, and will be
dependent on the facts and circumstances existing at such time. As a result,
there may be a degree of uncertainty in ascertaining whether a sale or transfer
of "all or substantially all" of the assets of the Company has occurred. In
addition, no assurances can be given that the Company will be able to acquire
the Notes tendered upon the occurrence of a Repurchase Event.
For purposes of this definition, (i) the terms "person" and "group" shall
have the meaning used for purposes of Rules 13d-3 and 13d-5 of the Exchange Act
as in effect on the Issue Date, whether or not applicable; and (ii) the term
"beneficial owner" shall have the meaning used in Rules 13d-3 and 13d-5 under
the Exchange Act as in effect on the Issue Date, whether or not applicable,
except that a "person" shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire, whether
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EXHIBIT 2
such right is exercisable immediately or only after the passage of time or
upon the occurrence of certain events.
The Change of Control purchase feature of the Notes may make more difficult
or discourage a takeover of the Company. and, thus, the removal of incumbent
management. The Change of Control purchase feature resulted from negotiations
between the Company and the Underwriters and is not the result of management's
knowledge of any specific effort to accumulate shares of Common Stock of the
Company or to obtain control of the Company by means of a merger, tender offer,
solicitation or otherwise, or part of a plan by management to adopt a series of
anti-takeover provisions.
To the extent applicable and if required by law, the Company will comply with
Section 14 of the Exchange Act and the provisions of Regulation 14E and any
other tender offer rules under the Exchange Act and any other securities laws,
rules and regulations which may then be applicable to any offer by the Company
to purchase the Notes at the option of Holders upon a Repurchase Event.
The right to require the Company to repurchase Notes as a result of the
occurrence of a Change of Control could create an event of default under Senior
Indebtedness as a result of which any repurchase could, absent a waiver, be
blocked by the subordination provision of the Notes. See "--Subordination."
Failure of the Company to repurchase the Notes when required would result in an
Event of Default with respect to the Notes whether or not such repurchase is
permitted by the subordination provisions.
CERTAIN COVENANTS
LIMITATION ON TRANSACTIONS WITH AFFILIATES
The Indenture will provide that the Company will not, and will not permit any
of its Subsidiaries to, enter into any contract, agreement, arrangement,
understanding or transaction with an Affiliate (an "Affiliate Transaction"), or
series of related Affiliate Transactions, involving consideration to either
party in excess of $500,000, except for transactions approved by a majority of
the disinterested (as to such transaction) Directors of the Company and
evidenced by an Officers' Certificate addressed and delivered to the Trustee
stating that such Affiliate Transaction has been so approved and is made in good
faith and that the terms of such Affiliate Transaction are no less favorable
than could have been obtained in an arm's length transaction with a non-
Affiliate and are otherwise fair and reasonable to the Company; PROVIDED, that
with respect to any Affiliate Transaction (including any series of related
transactions) involving consideration to either party in excess of $5.0 million
the Company also must, prior to the consummation thereof, obtain a written
favorable opinion as to the fairness of such transaction to the Company from a
financial point of view from an independent investment banking firm of national
reputation. Transactions solely between or amongst the Company and any
Subsidiary of the Company generally shall not be deemed to be Affiliate
Transactions.
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EXHIBIT 2
LIMITATION ON MERGER, SALE OR CONSOLIDATION
The Indenture will provide that the Company may not, directly or indirectly,
consolidate with or merge with or into another person or sell, lease, convey or
transfer all or substantially all of its assets (computed on a consolidated
basis), whether in a single transaction or a series of related transactions, to
another Person or group of affiliated Persons, unless (i) either (a) in the case
of a merger or consolidation the Company is the surviving entity or (b) the
resulting, surviving or transferee entity is a corporation organized under the
laws of the United States, any state thereof or the District of Columbia and
expressly assumes by supplemental indenture all of the obligations of the
Company in connection with the Notes and the Indenture; (ii) no Default or Event
of Default shall exist or shall occur immediately after giving effect on A PRO
FORMA BASIS to such transaction; and (iii) such transaction will not result in
the loss of any Material Gaming License.
Upon any consolidation or merger or any transfer of all or substantially all
of the assets of the Company in accordance with the foregoing, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such transfer is made, shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under the Indenture with the
same effect as if such successor corporation had been named therein as the
Company, and the Company will be released from its obligations under the
Indenture and the Notes, except as to any obligations that arise from or as a
result of such transaction
REPORTS
Whether or not the Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall deliver to the
Trustee and to each Holder, within 15 days after it is or would have been
required to file such with the SEC, annual and quarterly consolidated financial
statements substantially equivalent to financial statements that would have been
included in reports filed with the SEC if the Company was subject to the
requirements of Section 13 or 15(d) of the Exchange Act, including, with respect
to annual information only, a report thereon by the Company's certified
independent public accountants as such would be required in such reports to the
SEC and, in each case, together with a management's discussion and analysis of
financial condition and results of operations which would be so required.
EVENTS OF DEFAULT AND REMEDIES
The Indenture will define an Event of Default as (i) the failure by the
Company to pay any installment of interest on the Notes as and when due and
payable and the continuance of any such failure for 30 days, (ii) the failure by
the Company to pay all or any part of the principal of, or premium, if any, on
the Notes when and as the same become due and payable at maturity, redemption,
by acceleration or otherwise, including, without limitation, pursuant to any
Repurchase Offer or otherwise, (iii) the failure of the
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EXHIBIT 2
Company to perform any conversion of Notes required under the Indenture and
the continuance of any such failure for 30 days, (iv) the failure by the
Company to observe or perform any other covenant or agreement contained in
the Notes or the Indenture and, subject to certain exceptions, the
continuance of such failure for a period of 60 days after written notice is
given to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in aggregate principal amount of the Notes
outstanding, (v) certain events of bankruptcy, insolvency or reorganization
in respect of the Company or any of its Significant Subsidiaries, (vi) a
default in the payment of principal, premium or interest when due which
extends beyond any stated period of grace applicable thereto or an
acceleration for any other reason of the maturity of any Indebtedness of the
Company or any of its Subsidiaries with an aggregate principal amount in
excess of $5.0 million, (vii) final unsatisfied judgments not covered by
insurance aggregating in excess of $5.0 million, at any one time rendered
against the Company or any of its Subsidiaries and not stayed, bonded or
discharged within 75 days, and (viii) the loss of the legal right to operate
any Designated Casino and such loss continuing for more than 90 days. The
Indenture provides that if a Default occurs and is continuing, the Trustee
must, within 90 days after the occurrence of such default, give to the
Holders notice of such default.
The Indenture will provide that if an Event of Default occurs and is
continuing (other than an Event of Default specified in clause (v), above), then
in every such case, unless the principal of all of the Notes shall have already
become due and payable, either the Trustee or the Holders of 25% in aggregate
principal amount of the Notes then outstanding, by notice in writing to the
Company (and to the Trustee if given by Holders) (an "Acceleration Notice"), may
declare all principal and accrued interest thereon to be due and payable
immediately. If an Event of Default specified in clause (v), above, occurs, all
principal and accrued interest thereon will be immediately due and payable on
all outstanding Notes without any declaration or other act on the part of
Trustee or the Holders. The Holders of no less than a majority in aggregate
principal amount of Notes generally are authorized to rescind such acceleration
if all existing Events of Default, other than the non-payment of the principal
of, premium, if any, and interest on the Notes which have become due solely by
such acceleration, have been cured or waived.
Prior to the declaration of acceleration of the maturity of the Notes, the
Holders of a majority in aggregate principal amount of the Notes at the time
outstanding may waive on behalf of all the Holders any default, except a default
in the payment of principal of or interest on any Note not yet cured, or a
default with respect to any covenant or provision which cannot be modified or
amended without the consent of the Holder of each outstanding Note affected.
Subject to the provisions of the Indenture relating to the duties of the
Trustee, the Trustee will be under no obligation to exercise any of its rights
or powers under the Indenture at the request, order or direction of any of the
Holders, unless such Holders have offered to the Trustee reasonable security or
indemnity. Subject to all provisions of the Indenture and applicable law, the
Holders of a majority in aggregate principal amount of the Notes at the time
outstanding will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee.
<PAGE>
EXHIBIT 2
AMENDMENTS AND SUPPLEMENTS
The Indenture will contain provisions permitting the Company and the Trustee
to enter into a supplemental indenture for certain limited purposes without the
consent of the Holders. With the consent of the Holders of not less than a
majority in aggregate principal amount of the Notes at the time outstanding, the
Company and the Trustee are permitted to amend or supplement the Indenture or
any supplemental indenture or modify the rights of the Holders; PROVIDED, that
no such modification may, without the consent of each Holder affected thereby:
(i) change the Stated Maturity of any Note or reduce the principal amount
thereof or the rate (or extend the time for payment) of interest thereon or any
premium payable upon the redemption thereof, or change the place of payment
where, or the coin or currency in which, any Note or any premium or the interest
thereon is payable, or impair the right to institute suit for the enforcement of
any such payment or the conversion of any Note on or after the due date thereof
(including, in the case of redemption, on or after the Redemption Date), or
reduce the Repurchase Price, or alter the redemption provisions in a manner
adverse to the Holders, or (ii) reduce the percentage in principal amount of the
outstanding Notes, the consent of whose Holders is required for any such
amendment, supplemental indenture or waiver provided for in the Indenture, or
(iii) adversely affect the right of such Holder to convert Notes, or (iv) modify
any of the waiver provisions, except to increase any required percentage or to
provide that certain other provisions of the Indenture cannot be modified or
waived without the consent of the Holder of each outstanding Note affected
thereby.
NO PERSONAL LIABILITY OF STOCKHOLDERS, OFFICER, DIRECTORS
The Indenture will provide that no stockholder, employee, officer or
director, as such, past, present or future of the company or any successor
corporation shall have any personal liability in respect of the obligations of
the Company under the Indenture or the Notes by reason of his or its status as
such stockholder, employee, officer or director.
CERTAIN DEFINITIONS
"AFFILIATE" means (i) any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, (ii)
any spouse, immediate family member, or other relative who has the same
principal residence of any person described in clause (i) above, and (iii) any
trust in which any person described in clause (i) or (ii) above has a beneficial
interest. For purposes of this definition, the term "control" means (a) the
power to direct the management and policies of a person, directly or through one
or more intermediaries, whether through the ownership of voting securities, by
contract, or otherwise, or (b) the beneficial ownership of 10% or more of any
class of voting Capital Stock of a person (on a fully diluted basis) or of
warrants or other rights to acquire such class of Capital Stock (whether or not
presently exercisable).
<PAGE>
EXHIBIT 2
"BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to close.
"CAPITAL STOCK" means, with respect to any corporation, any and all shares,
interests, rights to purchase (other than convertible or exchangeable
indebtedness), warrants, options, participations or other equivalents of or
interests (however designated) in stock issued by that corporation.
"DESIGNATED CASINO" means each gaming establishment owned and/or operated by
the Company or any of its Subsidiaries if such gaming establishment, and any
hotel, building, restaurant, theater, parking facilities, retail shops, land,
equipment and other property or asset directly ancillary thereto, accounted for
at least 25% of the Company's net revenues (computed on a consolidated basis)
for the immediately preceding 12-month period.
"EXCLUDED PERSONS" means J. Thomas Long and William F. Cellini, and certain
partnerships and trusts organized for the benefit of the foregoing.
"GAMING LICENSES" means every material license, franchise or other
authorization required to own, lease, operate or otherwise conduct or manage
riverboat, dockside or land-based gaming in any state or jurisdiction in which
the Company or any Subsidiary of the Company then conducts business.
"INDEBTEDNESS" of any person means, without duplication, (a) all liabilities
and obligations, contingent or otherwise, of any such person, (i) in respect of
borrowed money (whether or not the recourse of the lender is to the whole of the
assets of such person or only to a portion thereof), (ii) evidenced by bonds,
notes, debentures or similar instruments, (iii) representing the balance
deferred and unpaid of the purchase price of any property or services, except
such as would constitute trade payables to trade creditors in the ordinary
course of business that are not more than ninety (90) days past their original
due date, (iv) evidenced by bankers' acceptances or similar instruments issued
or accepted by banks, (v) for the payment of money relating to a Capitalized
Lease Obligation, or (vi) evidenced by a letter of credit or a reimbursement
obligation of such person with respect to any letter of credit; (b) all net
obligations of such person under Interest Swap and Hedging Obligations; (c) all
liabilities of others of the kind described in the preceding clauses (a) or (b)
that such person has guaranteed or that is otherwise its legal liability and all
obligations to purchase, redeem or acquire any Capital Stock; and (d) any and
all deferrals, renewals, extensions, refinancings and refundings (whether direct
or indirect) of any liability of the kind described in any of the preceding
clauses (a), (b) or (c), or this clause (d), whether or not between or among the
same parties.
"ISSUE DATE" means the date of first issuance of the Notes under the
Indenture.
<PAGE>
EXHIBIT 2
"JUNIOR SECURITIES" of any Person means any Qualified Capital Stock and any
Indebtedness of such Person that is subordinated in right of payment to the
Notes and has no scheduled installment of principal due, by redemption, sinking
fund payment or otherwise, on or prior to the Stated Maturity of the Notes.
"MATERIAL GAMING LICENSE" means a Gaming License in respect of a Designated
Casino.
"SENIOR INDEBTEDNESS" of the Company means Indebtedness of the Company that,
by the terms of the instrument creating or evidencing such Indebtedness, is
expressly designated Senior Indebtedness and made senior in right of payment to
the Notes; PROVIDED that in no event shall Senior Indebtedness include (a)
Indebtedness of the Company owed or owing to any Subsidiary of the Company or
any officer, director or employee of the Company or any Subsidiary of the
Company, (b) Indebtedness to trade creditors or (c) any liability for taxes owed
or owing by the Company.
"STATED MATURITY" when used with respect to any Note, means June 1, 2001.
"SUBSIDIARY, " with respect to any person, means (i) a corporation a majority
of whose Capital Stock with voting power normally entitled to vote in the
election of directors is at the time, directly or indirectly, owned by such
person, by such person and one or more Subsidiaries of such person or by one or
more Subsidiaries of such person, (ii) a partnership in which such Person or a
subsidiary of such Person is, at the time, a general partner, or (iii) any other
person (other than a corporation) in which such person, one or more Subsidiaries
of such person, or such person and one or more subsidiaries of such person,
directly or indirectly, at the date determination thereof has at least majority
ownership interest.
