<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:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
ARGOSY GAMING COMPANY
- -------------------------------------------------------------------------------
(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)(1)
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:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
PRELIMINARY COPY
ARGOSY GAMING COMPANY
_________________________________
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
_________, 1998
_________________________________
A Special Meeting of Stockholders of Argosy Gaming Company ("Argosy"
or the "Company") will be held at the offices of the Company, 219 Piasa Street,
Alton, Illinois 62002 on ____________, 1998, at 2:00 p.m., local time, for the
following purposes:
1. To consider and vote upon the issuance by the Company of shares
of Common Stock upon conversion of its Series A Convertible Preferred Stock and
exercise of its Warrants to Purchase Common Stock to insure compliance with (a)
the provisions of that certain Securities Purchase Agreement dated June 12, 1998
and (b) Rule 312 of the New York Stock Exchange; and
2. To transact such other business as may properly come before the
meeting or any adjournment of postponement thereof.
The close of business on ___________, 1998 has been fixed as the
record date for the meeting. Only stockholders of record at that time are
entitled to notice of and to vote at the meeting and any adjournment or
postponement thereof.
All stockholders are cordially invited to attend the meeting.
However, to assure your representation at the meeting, the Board of Directors of
Argosy urge you to date, execute and return promptly the enclosed proxy to give
voting instructions with respect to your shares of Common Stock. The return of
the proxy will not affect your right to vote in person if you do attend the
meeting.
JAMES B. PERRY
President
___________, 1998
<PAGE>
ARGOSY GAMING COMPANY
219 Piasa Street
Alton, Illinois 62002
_____________________
PROXY STATEMENT
_____________________
SOLICITATION AND REVOCABILITY OF PROXIES
This proxy statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Argosy Gaming Company ("Argosy" or the
"Company") for use in voting at a Special Meeting of Stockholders (the
"Meeting") to be held at the offices of the Company, 219 Piasa Street, Alton,
Illinois 62002 on _________, _______, 1998, at 2:00 p.m. local time, and at any
postponement or adjournment thereof, for the purpose set forth in the attached
notice. This proxy statement, the attached notice and the enclosed proxy are
being sent to stockholders on or about _______, 1998.
The Board of Directors does not intend to bring any matter before the
Meeting except that indicated in the notice. If any other matter properly comes
before the Meeting, however, the persons named in the enclosed proxy, or their
duly constituted substitutes acting at the Meeting, will be authorized to vote
or otherwise act thereon in accordance with their judgment on such matters.
If proxies are properly dated, executed and returned, the shares they
represent will be voted at the Meeting in accordance with the instructions of
the stockholder. If no specific instructions are given, the shares will be
voted FOR the proposal to approve the issuance by the Company of shares of
Common Stock in order to comply with (a) the provisions of that certain
Securities Purchase Agreement dated June 12, 1998 and (b) Rule 312 of the New
York Stock Exchange, and with respect to any other matter that may properly come
before the meeting, in the discretion of the persons voting the respective
proxies.
A stockholder giving a proxy has the power to revoke it at any time
prior to its exercise by voting in person at the meeting, by giving written
notice to the Secretary of the Company prior to the Meeting, or by giving a
later dated proxy.
The Company will bear the cost of this solicitation of proxies,
including expenses in connection with the preparing, assembling and mailing of
proxy solicitation materials and the charges and expenses of brokerage firms and
others for forwarding solicitation materials to beneficial owners. In addition
to solicitation by mail, proxies may be solicited personally or by telephone or
telegraph by Directors, Officers or employees of the Company, who will receive
no additional compensation for such services.
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RECORD DATE AND OUTSTANDING SHARES
At the close of business on ___________, 1998, the record date fixed
for the determination of stockholders entitled to notice of and to vote at the
Meeting, there were outstanding 24,498,333 shares of the Company's common stock,
par value $0.01 per share, ("Common Stock"), the only class of voting securities
outstanding. Only the record holders of Common Stock as of the close of
business on __________, 1998 will be entitled to vote. The presence at the
Meeting, in person or by proxy, of stockholders entitled to cast a majority of
the votes which all stockholders are entitled to cast will constitute a quorum.
Each share of Common Stock is entitled to one vote.
In addition, there are outstanding $115,000,000 of the Company's
Convertible Subordinated Notes Due 2001 (the "Convertible Notes"), which are
convertible into Common Stock of the Company at any time prior to maturity at a
conversion price of $17.70 per share. Although no Convertible Notes have been
converted into Common Stock as of the record date, these securities represent an
additional 6,497,175 shares of Common Stock that may be outstanding in the
future.
As discussed below, the Company has issued a series of Preferred
Stock, which may be converted into shares of Common Stock, and Warrants, which
may be exercised to purchase shares of Common Stock. The Company has been
informed by the New York Stock Exchange that, under its rules, any shares of
Common Stock issued prior to the meeting, upon such conversion or exercise, will
not be entitled to vote on the Proposal (as defined below) at the Meeting.
REQUIRED VOTE
Only votes cast in person at the Meeting or by proxy received by the
Company before commencement of the Meeting will be counted at the Meeting. The
approval of the issuance by the Company of shares of Common Stock (the
"Proposal") will become effective only upon the affirmative vote of stockholders
of the Company owning in the aggregate at least a majority of the Company's
outstanding shares of Common Stock present in person and by proxy at the
Meeting. Votes cast as abstentions will not be counted as a vote for or against
the Proposal, but will nevertheless have the effect of increasing the total
votes cast on the matter and thus increase the number of votes necessary to
effectuate the Proposal. So called "broker non-votes" (brokers failing to vote
by proxy shares of the Common Stock held in nominee name for customers) will not
be counted at the Meeting. The effect of such broker non-votes is to decrease
the total votes cast on the matter and thus decrease the number of votes
necessary to effectuate the Proposal. Executive officers and directors of the
Company own shares, and exercisable rights to acquire shares, representing an
aggregate of ________ shares of Common Stock or ____% of the outstanding shares
of Common Stock (See "Security Ownership of Certain Beneficial Owners and
Management").
PROPOSAL TO APPROVE ISSUANCE BY THE COMPANY
OF SHARES OF COMMON STOCK IN ORDER TO COMPLY
WITH (a) THE PROVISIONS OF THAT CERTAIN SECURITIES
PURCHASE AGREEMENT DATED JUNE 12, 1998 AND
(b) RULE 312 OF THE NEW YORK STOCK EXCHANGE
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The Board of Directors has designated 1,600 shares of the Company's
10,000,000 authorized shares of Preferred Stock as Series A Convertible
Preferred Stock (the "Series A Shares"). On June 16, 1998, the Company issued
and sold to eight investors who, together with the Company, are parties to a
Securities Purchase Agreement, dated June 12, 1998 (the "Agreement"), a total of
800 Series A Shares and related Warrants to Purchase Common Stock ("Warrants").
Subject to the fulfillment of certain terms and conditions set forth in the
Agreement, the holders of the Series A Shares have the right to purchase, and
the Company has the right to require the holders of the Series A Shares to
purchase, up to an additional 800 Series A Shares and related Warrants in the
aggregate. The purchase price for each Series A Share and related Warrant is
$10,000.
The Agreement provides, among other things, that if, on any date (a
"Proxy Statement Trigger Date") after June 16, 1998 the average of the Closing
Bid Prices of the Common Stock for the five consecutive trading days immediately
preceding such date is equal to or less than $2.75, the Company shall provide
each stockholder entitled to vote at the next meeting of stockholders of the
Company, which meeting shall not be later than 75 days after the Proxy Statement
Trigger Date (the "Stockholder Meeting Deadline"), a proxy statement, which has
been previously reviewed by the investors and a counsel of their choice,
soliciting each such stockholder's affirmative vote at such stockholder meeting
for approval of the Company's issuance of all of the securities as described in
the Agreement, and the Company shall use its best efforts to solicit its
stockholders' approval of such issuance and cause the Board of Directors of the
Company to recommend to the stockholders that they approve such proposal. If
the Meeting is not held by the Stockholder Meeting Deadline, the Company is
subject to monetary penalties. The Company has been notified by the investors
that the Proxy Statement Trigger Date occurred on August 14, 1998. The
investors have agreed, subject to certain conditions, to extend the Stockholder
Meeting Deadline from October 28, 1998 to ____________, 1998. Accordingly, this
Meeting is being held in order to comply with such provision of the Agreement.
If stockholders do not approve the issuance by the Company of all shares of
Common Stock issuable upon conversion of 1,600 Series A Shares and upon exercise
of the related Warrants, each holder of Series A Shares has the right, subject
to limitations set forth in the Certificate of Designation (as hereinafter
defined), to require the Company to redeem all or a portion of such holder's
Series A Shares. The Company is prohibited by the terms of the Convertible
Notes and First Mortgage Notes (as hereinafter defined) from redeeming any
portion of the Series A Shares, and thus could be liable for damages to the
holders of the Series A Shares if the stockholders fail to approve the Proposal.
Rule 312 of The New York Stock Exchange, Inc. ("NYSE") requires, as a
prerequisite to the listing of common stock on such Exchange, specific
stockholder authorization in connection with the issuance of shares of common
stock or securities convertible into or exercisable for common stock if the
number of shares of common stock to be issued is or will be equal to or in
excess of 20% of the number of shares of common stock outstanding before the
issuance of the stock. Accordingly, this Meeting is also being held in order to
comply with such Rule.
On June 16, 1998 the number of shares of the Company's Common Stock
that were outstanding was 24,498,333. If 1,600 Series A Shares and related
Warrants are sold, the maximum
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number of shares of common stock which would be issuable upon conversion of
the Series A Shares and exercise of the Warrants is likely to exceed
4,899,666 shares (i.e. 20% of 24,498,333). The Company is obligated under
the Agreement to seek listing approval for all shares issuable upon
conversion of the Series A Shares and the exercise of the Warrants.
On _____________, 1998, using the assumptions set forth below, the 800
Series A Shares then outstanding were convertible into a total of ______ shares
of Common Stock and the related Warrants then outstanding were exercisable to
purchase a total of ____ shares of Common Stock, for an aggregate of ___ shares
of Common Stock issuable upon conversion of the 800 Series A Shares and exercise
of the related Warrants. The Series A Shares are convertible at the lower of
the fixed conversion price and the floating conversion price. The fixed
conversion price and the warrant exercise price are subject to adjustment to
prevent dilution and may be reset downward 270 days after issuance depending on
market conditions. The fixed conversion price is also subject to adjustment
upon the occurrence of certain events. The floating conversion price is
determined by market prices during a period immediately preceding conversion.
Due to the indeterminate nature of the floating conversion price and the
possibility of adjustments to the fixed conversion price and the warrant
exercise price, the number of shares of Common Stock referred to above as being
issuable is illustrative and may not set forth the total number of shares
actually issued upon conversion of the Series A Shares and the exercise of the
Warrants, in full. Those numbers are based on an assumed floating conversion
price of $_____ per share and a fixed conversion price and a warrant exercise
price of $_____ per share.
Subject to fulfillment of certain terms and conditions, the holders of
the Series A Shares have the right to purchase, and the Company has the right to
require the holders of the Series A Shares to purchase, up to an additional 800
Series A Shares and related Warrants in the aggregate. The fixed conversion
price for those Series A Shares and the exercise price for those Warrants would
be determined at the time of their issuance; however, the Company believes that
it is likely that the total number of shares of Common Stock issuable upon their
conversion or exercise, as the case may be, would not be less than is the case
with the 800 Series A Shares and related Warrants outstanding on _________,
1998.
The Company has granted registration rights to the holders of the
Series A Shares and the Warrants with respect to all of the shares of Common
Stock issuable upon their conversion or exercise, as the case may be. By
exercising their registration rights, converting the Series A Shares into Common
Stock and purchasing Common Stock upon exercise of the Warrants, the holders of
the Series A Shares and Warrants can cause a large number of shares of Common
Stock to be registered and become freely tradeable without restrictions under
the Securities Act of 1933. Such sales may have an adverse effect on the market
price of the Common Stock and could impair the Company's ability to raise
additional capital.
Stockholders are being asked to approve the issuance of all shares of
Common Stock issuable upon conversion of the 1,600 Series A Shares and upon
exercise of the related Warrants in accordance with the respective terms
thereof. Although the NYSE authorized, upon official notice of issuance, the
listing of 4,897,215 shares of Common Stock issuable upon conversion of the
Series
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A Shares and upon exercise of the Warrants, it requested that the Company
seek stockholder approval for the issuance of all shares of Common Stock that
may be issued under the respective terms of the Series A Shares and the
Warrants. If so approved, the Company will apply to list such number of
additional shares of Common Stock as may become issuable under the respective
terms of the Series A Shares and the Warrants. If not so approved, the
Company would not be able to obtain the listing of such number of additional
shares of Common Stock which may become issuable under the respective terms
of the Series A Shares and the Warrants. In such event, the Company could be
liable to the holders of the Series A Shares for damages since it would be
prohibited by the terms of its public debt indentures from redeeming the
Series A Shares which it would be required to do if the Proposal is not
approved by the stockholders. SEE DISCUSSION BELOW CONCERNING POSSIBLE
DELISTING BY THE NYSE OF ALL SECURITIES OF THE COMPANY.
Under the provisions of the Certificate of Designations, Preferences
and Rights of the Series A Shares (the "Certificate of Designations"), the
Company is not required to issue shares of Common Stock upon conversion of
Series A Shares if such issuance would exceed the number of shares of Common
Stock which the Company may issue without breaching its obligations under the
rules of the NYSE (the "Exchange Cap"). The Warrants do not contain a similar
provision. The Certificate of Designations also provides that until approval of
stockholders is obtained, no purchaser of Series A Shares pursuant to the
Agreement shall, upon conversion thereof, be issued shares of Common Stock in an
amount greater than the product of (i) the Exchange Cap multiplied by (ii) a
fraction, the numerator of which is the number of Series A Shares issued to such
purchaser and the denominator is the aggregate number of all Series A Shares
issued. However, in the event that the Company is prevented by the Exchange Cap
from issuing all of the shares of Common Stock required in accordance with the
provisions of a holder's conversion notice, the Certificate of Designations
provides that the holder may, with respect to the unconverted shares, (a)
require the Company, subject to certain terms and conditions, to redeem such
shares or (b) void the conversion notice and retain such shares. The Company is
prohibited by the terms of the Convertible Notes and First Mortgage Notes (as
hereinafter defined) from redeeming any portion of the Series A Shares, and thus
could be liable for damages to the holders of the Series A Shares if the
stockholders fail to approve the Proposal.
In the spring of 1998, the Company determined that it required
additional funds for the operation of its business; however, the Company could
not, because of provisions in the Indenture dated June 5, 1996, under which its
13-1/4% First Mortgage Notes due 2004 (the "First Mortgage Notes") were issued,
borrow the additional funds. The Company's only significant source of liquidity
was cash flow from operations which was being used for debt service on its
publicly-held debt, working capital, capital expenditures and contingent
liabilities. Accordingly, it sought the assistance of an investment banking
firm with regard to structuring an equity financing. After discussions with
several prospects, the Company concluded that the transaction contemplated by
the Agreement and related documents was the only feasible opportunity to raise
funds at that time. Therefore, the Board of Directors approved the execution of
the Agreement and authorized the creation of the Series A Shares and the
issuance of the Warrants. The Company received $8,000,000 from the sale of 800
Series A Shares and related Warrants which it used for general corporate
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purposes. Proceeds derived from the sale of additional Series A Shares and
related Warrants would also be used for general corporate purposes. None of the
purchasers of the Series A Shares and Warrants had any affiliation with the
Company prior to such transaction.
RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE FOR THE PROPOSAL TO APPROVE ISSUANCE BY
THE COMPANY OF SHARES OF COMMON STOCK IN ORDER
TO COMPLY WITH (a) THE PROVISIONS OF THE AGREEMENT
AND (b) RULE 312 OF THE NEW YORK STOCK EXCHANGE
EXCHANGE LISTING
The Company has been advised by the NYSE that it does not currently
meet the NYSE's requirements for continued listing. Specifically, the
Company does not meet the NYSE's net tangible asset requirement of at least
$12 Million or the requirement that it have a three (3) year average net
income of at least $600,000. The Company has met with the staff of the NYSE
and presented the Company's plan for complying with the NYSE's requirements
for continued listing. On September 11, 1998 the Company was informed by the
NYSE that the Company will continue to be listed on the NYSE, but that the
NYSE will review on a quarterly basis the Company's progress with the plan
submitted by the Company to comply with the NYSE continued listing criteria.
In the event the NYSE decides to de-list the Company, the Company intends to
apply for listing on the American Stock Exchange ("ASE") or the NASDAQ
National Market ("NASDAQ"); however, the Company does not currently meet all
of the listing requirements of either the ASE or NASDAQ. No assurance can be
given that the Company will continue to be listed on the NYSE or that, if the
Company is de-listed from the NYSE, the Company will be listed on either the
ASE or NASDAQ.
In addition to their respective financial criteria for listing,
both the ASE and NASDAQ have a requirement similar to Rule 312 of the NYSE.
Thus, approval by the stockholders of the issuance by the Company of shares
of Common Stock in order to comply with Rule 312 of the NYSE should satisfy
the requirement of ASE or NASDAQ for stockholder approval in that regard. In
the event the Company is unable to list its Common Stock on ASE or NASDAQ,
quotations for the Common Stock would most likely occur through the
over-the-counter "pink sheets" which would limit the marketability of the
Common Stock. Further, the failure of the Common Stock to trade on a national
exchange or market would (a) give the holders of the Series A Shares the
right, subject to limitations set forth in the Certificate of Designations,
to require that Company to redeem the Series A Shares and (b) likely result
in a default by the Company under its Convertible Notes and First Mortgage
Notes which would have a material adverse effect on the Company.
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DESCRIPTION OF PREFERRED STOCK
The Board of Directors of the Company is authorized, without further
stockholder action, to divide any or all shares of the authorized Preferred
Stock into one or more series and to fix and determine the designations,
preferences and relative, participating, optional or other special rights and
qualifications, limitations or restrictions thereon, of any series so
established, including voting powers, dividend rights, liquidation preferences,
redemption rights and conversion privileges.
The Board of Directors has designated 1,600 of shares of Preferred
Stock as Series A Convertible Preferred Stock (the "Series A Shares"). As of
September 30, 1998, 800 Series A Shares were outstanding. Following is a
description of certain provisions of the Certificate of Designations.
STATED VALUE - The stated value of the Series A Shares if $10,000 per share.
DIVIDENDS - The Series A Shares do not bear any dividends, however they do have
a premium rate of 4% per annum, payable in cash or in kind at the time of
conversion or redemption.
VOTING - The holders of the Series A Shares have no voting rights except as
required by law or upon any proposal to change any of the powers, preferences
and rights of the Series A Shares.
REDEMPTION - The Company may redeem all Series A Shares which are outstanding
seven years after the date of original issue at their stated value plus accrued
premium. Each holder of Series A Shares has the right, subject to limitations
set forth in that Certificate of Designations, to require the Company to redeem
all or a portion of such holder's Series A Shares upon the happening of certain
extraordinary events at a price per share equal to the greater of (i) 120% of
stated value plus accrued premium or (ii) the product of the conversion rate at
such time and the closing bid price per share set forth in the Certificate of
Designations, to redeem any or all Series A Shares at any time at a price per
share equal to the product of the conversion rate at such time and the closing
bid price per share of Common Stock at such time.
LIQUIDATION - The preference of the Series A Shares over the Common Stock in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company is the stated value of such shares plus accrued premium.
SINKING FUND - None
CONVERSION - The Series A Shares are convertible into shares of Common Stock at
a price per share equal to the lesser of (i) 120% of the average closing bid
prices for the Common Stock for the five trading days immediately preceding the
original issuance date thereof (the "Fixed Conversion Price") or (ii) 100% of
the average of the five lowest consecutive closing bid prices during the period
of 30 consecutive trading days immediately preceding conversion (the "Floating
Conversion Price"). The Series A Shares are convertible at any time at the
Fixed Conversion Price. The Series A Shares are not convertible at the Floating
Conversion Price during the period of 120 days
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following the original issuance date. Thereafter, they are convertible in
increasing increments up to 211 days following the original issuance date at
which time they become fully convertible. The Company has the right, subject
to the satisfaction of conditions set forth in the Certificate of
Designations, to require the conversion of any or all Series A Shares at any
time at a price per share equal to the lesser of the Fixed Conversion Price
or the Floating Conversion Price. The conversion rate for each Series A Share
is determined by dividing (i) its stated value plus accrued premium by (ii)
the applicable conversion price. To protect against dilution, the Fixed
Conversion Price is subject to adjustment in certain events, including stock
dividends, stock splits and the issuance of Common Stock for cash at less
than the Fixed Conversion Price then in effect. The Fixed Conversion Price is
subject to adjustment upon the happening of certain extraordinary events or
the failure or inability of the Company to take certain action or in the
event that closing bid prices for the Common Stock during specified periods
ending 270 days following the original issuance date of such Shares is less
than the Fixed Conversion Price. If the Company issues a convertible
security with a variable price which uses a formula different from the one
used to calculate the Floating Conversion Price, the Floating Conversion
Price then in effect may be replaced by the other formulation.
DESCRIPTION OF WARRANTS
The Warrants may be exercised at any time. The number of shares of
Common Stock purchasable upon exercise is determined by the warrant value as of
the date of issuance of the Warrant and the exercise price in effect from time
to time. The warrant value is determined as of the applicable issuance date
using the Black-Scholes valuation method. The initial exercise price is based
upon 120% of the average closing bid prices for the Common Stock for the five
trading days immediately preceding the applicable issuance date. Thereafter,
the exercise price is subject to adjustment to prevent dilution and may be reset
270 days after the applicable issuance date if closing bid prices for the Common
Stock on specified dates are lower than the initial exercise price. The
Warrants expire five years from the applicable issuance date.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth, as of the close of business on
______________, 1998, certain information with respect to the beneficial
ownership of Common Stock and shares of Common Stock represented by the
Convertible Notes beneficially owned by (i) each director of the Company, (ii)
the most highly compensated executive officers of the Company (collectively, the
"named officers"), (iii) all executive officers and directors as a group and
(iv) each stockholder who is known to the Company to be the beneficial owner, as
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of more than 5% of the outstanding Common Stock. Each of the
persons listed below has sole voting and investment power with respect to such
shares, unless otherwise indicated.
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<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
REPRESENTED BY
CONVERTIBLE NOTES
COMMON STOCK BENEFICIALLY PERCENT
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED OWNED (a) OF CLASS
------------------------ ------------------ --------- --------
<S> <C> <C> <C>
DIRECTORS AND NAMED OFFICERS:
William F. Cellini 1,846,456(b)(c)(d) 31,075 7.6%
219 Piasa Street
Alton, IL 62002
Edward F. Brennan 22,000(b) ----- *
219 Piasa Street
Alton, IL 62002
George L. Bristol 3,000(b) ----- *
219 Piasa Street
Alton, IL 62002
F. Lance Callis 1,540,778(b) 17,512 6.3%
219 Piasa Street
Alton, IL 62002
Jimmy F. Gallagher 1,440,778(b) ----- 5.9%
219 Piasa Street
Alton, IL 62002
William J. McEnery 1,530,778(b) ----- 6.2%
219 Piasa Street
Alton, IL 62002
John B. Pratt, Sr. 1,327,124(b)(e) ----- 5.4%
219 Piasa Street
Alton, IL 62002
James B. Perry 100,000(f) ----- *
219 Piasa Street
Alton, IL 62002
James A. Gulbrandsen 40,000(g) ----- *
219 Piasa Street
Alton, IL 62002
</TABLE>
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<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
REPRESENTED BY
CONVERTIBLE NOTES
COMMON STOCK BENEFICIALLY PERCENT
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED OWNED (a) OF CLASS
------------------------ ------------------ --------- --------
<S> <C> <C> <C>
John Pavone ----- ----- *
219 Piasa Street
Alton, IL 62002
Arnold Block 30,709(b) ------ *
219 Piasa Street
Alton, IL 62002
All directors and executive ________(b) _______ ____%
officers as a group
(__ persons) (h)
PRINCIPAL STOCKHOLDERS:
Kornitzer Capital Management, Inc. 165,500(i) 1,247,680 5.5%
P.O. Box 918
Shawnee Mission, Kansas 66201
Dimensional Fund Advisors, Inc. 1,660,800(j) ----- 6.8%
1299 Ocean Ave., 11th Floor
Santa Monica, California 90401
James S. Connors 2,291,667(k) ----- 9.4%
219 Piasa Street
Alton, Illinois 62002
Stephanie Pratt 1,124,125(e) ----- 5.4%
Box 104 Moro Road
Moro, IL 62067
</TABLE>
- --------------------------
*Less than 1%
(a) Shares of Common Stock represented by such person's ownership of
Convertible Notes, which are convertible into Common Stock of the Company
at any time prior to maturity at a conversion price of $17.70 per share.
(b) Amounts shown include 3,000 shares of Common Stock for William F. Cellini,
3,000 shares of Common Stock for Edward F. Brennan, 3,000 shares of Common
Stock for George L. Bristol, 3,000 shares of Common Stock for F. Lance
Callis, 3,000 shares of Common Stock
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for Jimmy F. Gallagher, 3,000 shares of Common Stock for William J.
McEnery, 3,000 shares of Common Stock for John B. Pratt, Sr., 30,709 shares
of Common Stock for Arnold Black and _____ for all directors and executive
officers as a group represented by stock options exercisable within 60 days
of _____________, 1998.
(c) Includes 381,945 shares held in Trust for William F. Cellini, Jr., as
beneficiary with an independent third party as sole trustee and 381,944
shares held in Trust for William F. Cellini, Jr., as beneficiary, with
William F. Cellini, Jr. and William F. Cellini, father of William F.
Cellini, Jr., as co-trustees. Mr. William F. Cellini disclaims beneficial
ownership of the 381,945 shares of Common Stock held in the William F.
Cellini, Jr. Trust by an independent third party as sole trustee.
(d) Includes 381,945 shares held in Trust for Claudia Marie Cellini, as
beneficiary, with an independent third party as sole trustee and 381,944
shares held in Trust for Claudia Marie Cellini as beneficiary with Claudia
Marie Cellini and William F. Cellini, father of Claudia Marie Cellini, as
co-trustees. Mr. William F. Cellini disclaims beneficial ownership of the
381,945 shares of Common Stock held in the William F. Cellini, Jr. Trust by
an independent third party as sole trustee.
(e) Includes 1,124,125 shares of Common Stock held by Mr. Pratt as Trustee
pursuant to a Voting Trust Agreement with Stephanie Pratt, his
sister-in-law, over which Mr. Pratt exercises sole voting power.
(f) Represents 100,000 shares of restricted Common Stock issued pursuant to an
Employment Agreement dated April 14, 1997 and governed by the terms of a
Restricted Stock Award Certificate and Deposit Agreement.
(g) Represents 40,000 shares of restricted Common Stock issued pursuant to an
Employment Agreement dated May 21, 1997 and governed by the terms of a
Restricted Stock Award Certificate and Deposit Agreement.
(h) The amounts shown do not include a total of _______ shares of Common Stock
beneficially owned, and a total of ______ shares of Common Stock
represented by Convertible Notes beneficially owned, as of February 27,
1998 by four former executive officers who were listed in the executive
compensation table included in the Company's proxy statement for its 1998
annual meeting of stockholders.
(i) According to a Schedule 13G filed with the Securities and Exchange
Commission under the Exchange Act, Kornitzer Capital Management, Inc. has
shared voting power with respect to such shares.
(j) According to a Schedule 13G filed with the Securities and Exchange
Commission under the Exchange Act, Dimensional Fund Advisors, Inc. has sole
voting power with respect to such shares.
11
<PAGE>
(k) From February 25, 1993 until September 8, 1994 Mr. James S. Connors was a
director of the Company.
OTHER MATTERS
The Company knows of no other matters to be submitted to the
stockholders at the Special Meeting. If any other matters properly come before
the Special Meeting, it is the intention of the persons named in the enclosed
form of proxy to vote the shares they represent in accordance with the judgments
of the persons voting the proxies.
Upon written request by any stockholder entitled to vote at the
Special Meeting, the Company will furnish that person without charge a copy of
the Company's 1997 Annual Report to Stockholders, its Annual Report on Form 10-K
and 10-K/A for the year ended December 31, 1997 and its Quarterly Report on Form
10-Q for the quarterly period ending March 31, 1998 and its Quarterly Report on
Form 10-Q and 10-Q/A for the quarterly period ending June 30, 1998. Requests
should be addressed to James B. Perry, Argosy Gaming Company, 219 Piasa Street,
Alton, Illinois 62002.
By Order of the Board of Directors
JAMES B. PERRY
President
12
<PAGE>
PROXY
ARGOSY GAMING COMPANY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING OF STOCKHOLDERS, ________, 1998
The undersigned hereby appoints James B. Perry and Dale R. Black, and each
of them, attorneys and proxies, with the power of substitution in each of them,
to vote for and on behalf of the undersigned at the Special Meeting of
Stockholders of the Corporation to be held on _________, 1998, and at any
adjournment thereof, upon matters properly coming before the meeting, as set
forth in the related Notice of Meeting and Proxy Statement, both of which have
been received by the undersigned. Without otherwise limiting the general
authorization given hereby, said attorneys and proxies are instructed to vote as
follows:
YOUR VOTE IS IMPORTANT! PLEASE MARK, SIGN AND DATE THIS PROXY ON THE
REVERSE SIDE AND RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
<PAGE>
1. Proposal to approve issuance of For Against Abstain
Common Stock in order to comply / / / / / /
with provisions of a Securities Purchase
Agreement and Rule 312 of the New
York Stock Exchange.
2. In their discretion, the proxies are For Against Abstain
authorized to vote upon any other / / / / / /
business as may properly come before
the meeting.
Mark here if you plan to attend the meeting. / /
The Board of Directors recommends a vote FOR Items 1 and 2.
This Proxy will be voted in accordance with specification made. If no
choices are indicated, this Proxy will be voted FOR Items 1 and 2.
Dated: ________________________, 1998
Signature(s)_____________________________________________________
_______________________________________________________________
Please sign this proxy and return it promptly whether or not you expect to
attend the meeting. You may nevertheless vote in person if you attend. Please
sign exactly as your name appears herein. Give full title if an Attorney,
Executor, Administrator, Trustee, Guardian, etc. For an account in the name of
two or more persons, each should sign, or if one signs, he should attach
evidence of his authority.
- FOLD AND DETACH HERE -
YOUR VOTE IS IMPORTANT.
PLEASE MARK, SIGN AND DATE THIS PROXY AND
RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.
