<PAGE>
As filed with the Securities and Exchange Commission on July 10, 1998
Registration No. 333-
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
ARGOSY GAMING COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 37-1304247
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
----------------
219 PIASA STREET
ALTON, ILLINOIS 62002-6232
(618) 474-7500
(ADDRESS AND TELEPHONE NUMBER
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
----------------
JAMES B. PERRY
ARGOSY GAMING COMPANY
219 PIASA STREET
ALTON, ILLINOIS 62002
(618) 474-7500
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
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COPY OF COMMUNICATIONS TO:
M. FINLEY MAXSON
WINSTON & STRAWN
35 WEST WACKER DRIVE
CHICAGO, ILLINOIS 60601
(312) 558-5600
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Approximate date of commencement of proposed sale to the public: From
time to time after this Registration Statement becomes effective.
----------------
<PAGE>
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please check the
following box. / /
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /x/
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Each Class Amount Being Proposed Maximum Proposed Maximum Amount of
of Securities to be Registered (1) Offering Price Per Unit (2) Aggregate Offering Registration Fee
Registered Price (2)
<S> <C> <C> <C> <C>
Common Stock 5,000,000
($.01 par Shares $3.0625 $15,312,500 $4,720
value).............
</TABLE>
(1) Based upon number of shares issuable upon conversion of Series A
Convertible Preferred Stock and upon exercise of Warrants to Purchase
Common Stock. In accordance with Rule 416, the number of shares issuable
upon conversion and upon exercise is subject to change as a result of
stock splits, stock dividends and other similar transactions, as well as
a result of certain events, including fluctuations in the conversion
price of the Series A Convertible Preferred Stock, and this Registration
Statement shall cover such additional shares.
(2) Estimated in accordance with Rule 457(c) solely for purpose of calculating
the registration fee on the basis of the average of the high and low sales
prices for a share of Common Stock on the New York Stock Exchange on July
6, 1998.
----------------
The registrant hereby amends this Registration Statement under the
Securities Act of 1933 on such date or dates as may be necessary to delay its
effective date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become
effective in accordance with the provisions of Section 8(a) of the Securities
Act of 1933 or until the Registration Statement shall become effective on
such date as the Commission, acting pursuant to said Section 8(a), may
determine.
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION BECOMES EFFECTIVE.
THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION
OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 10, 1998
ARGOSY GAMING COMPANY
COMMON STOCK
($.01 PAR VALUE)
The prospectus relates to the offer and sale by certain persons listed
under "Selling Stockholders" (collectively, the "Selling Stockholders"), of (i)
up to 5,000,000 shares of Common Stock (collectively, the "Shares"), par value
$0.01 (the "Common Stock") of Argosy Gaming Company ("Argosy" or the "Company"),
issuable upon conversion of the Company's Series A Convertible Preferred Stock
(the "Preferred Shares") and upon exercise of the Company's Warrants to Purchase
Common Stock (the "Warrants"), and (ii) in accordance with Rule 416 under the
Securities Act of 1933, as amended (the "Securities Act"), such presently
indeterminate number of additional shares as may be issuable upon or after
conversion of the Preferred Shares or exercise of the Warrants based upon
fluctuations in the conversion price of the Preferred Shares and as a result of
stock splits, stock dividends and other similar transactions. All of the Shares
may be offered by the Selling Stockholders or by pledgees, donees, transferrees
or other successors in interest that receive Shares as a gift, partnership
distribution or other non-sale related transfer. See "Selling Stockholders."
The Shares are being registered by the Company pursuant to registration rights
granted to the Selling Shareholders.
The Selling Stockholders have not advised the Company of any specific plans
for the distribution of the Shares covered by this Prospectus. It is
anticipated, however, that the Shares will be offered and sold by the Selling
Stockholders from time to time in transactions on The New York Stock Exchange,
in privately negotiated transactions, or by a combination of such methods of
sale, at such fixed prices as may be negotiated from time to time, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. The Selling Stockholders may effect such
transactions by selling the Shares to or through broker-dealers and such broker-
dealers may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or the purchasers of the Shares for
whom such broker-dealers may act as agent or to whom they sell as principal or
both (which compensation to a particular broker-dealer might be in excess of
customary commissions). See "Plan of Distribution."
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Stockholders. The Company has agreed to bear certain
expenses in connection with the registration and sale of the Shares being
offered by the Selling Stockholders. The Company has agreed to indemnify the
Selling Stockholders against certain liabilities, including liabilities under
the Securities Act.
SEE "RISK FACTORS" BEGINNING ON PAGE 4 FOR A DISCUSSION
OF CERTAIN RISKS THAT SHOULD BE CONSIDERED IN CONNECTION
WITH AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY.
The Common Stock is listed on the New York Stock Exchange under the symbol
"AGY". On ________, 1998, the last reported sale price of the Common Stock on
the New York Stock Exchange was $______ per share. See "Price Range of Common
Stock."
-----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
-----------------
The date of this Prospectus is ____________, 1998.
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY, THE SELLING
STOCKHOLDERS OR ANY AGENT, UNDERWRITER OR DEALER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER, IN SUCH JURISDICTION. NEITHER THE DELIVERY OF
THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN IS CORRECT AS OF
ANY TIME SUBSEQUENT TO ITS DATE.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Certain
information, as of particular dates, concerning the Company's directors and
officers, their compensation, the principal holders of securities of the
Company and any material interests of such persons in transactions with the
Company is discussed in proxy statements of the Company distributed to
stockholders of the Company and filed with the Commission. Such reports,
proxy statements and other information can be inspected and copied at the
public reference facilities maintained by the Commission at Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549; and at the following regional
offices of the Commission: Northwestern Atrium Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661 and Suite 1300, Seven World Trade
Center, New York, New York 10048. Copies of such materials may be obtained
from the Public Reference Branch of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Certain of these materials may
also be obtained via the Commission's website (http://www.sec.gov). In
addition, such reports, proxy statements and other information can be
inspected at the New York Stock Exchange, Inc., 20 Broad Street, New York,
New York 10005.
The Company has filed with the Commission in Washington, D.C., a
Registration Statement on Form S-3 under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the securities offered
hereby. This Prospectus does not contain all of the information set forth in
the Registration Statement and exhibits thereto, as permitted by the rules
and regulations of the Commission. For further information pertaining to the
Company and the securities offered hereby, reference is made to the
Registration Statement and the exhibits thereto, which may be examined
without charge at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and copies
thereof may be obtained from the Public Reference Branch of the Commission
upon payment at prescribed rates.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents which have been filed by the Company with the
Commission are incorporated by reference in this Prospectus:
(a) the Company's Annual Report on Form 10-K for the year ended
December 31, 1997;
(b) the Company's Current Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 1998; and
(c) the Company's Current Reports on Form 8-K, dated March 18, 1998,
and on Form 8-K and 8-K/A, dated June 16, 1998.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to
the termination of the offering of securities contemplated hereby shall be
deemed to be incorporated by reference in this Prospectus or any Prospectus
Supplement and to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated by reference or deemed to be
incorporated by reference in this Prospectus or any Prospectus Supplement shall
be deemed to be modified or superseded for all purposes of this Prospectus or
such Prospectus Supplement to the extent that a statement contained herein,
therein or in any subsequent filed document which also is incorporated or deemed
to be incorporated by reference herein or in such Prospectus Supplement modifies
or supersedes such statement. Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus or any Prospectus Supplement.
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, upon the written or oral request of such
person, a copy of any and all of the documents referred to above which have been
or may be incorporated in this Prospectus by reference (other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
therein). Request for such copies should be directed to: Patsy S. Hubbard,
Corporate Secretary, Argosy Gaming Company, 219 Piasa Street, Alton, Illinois
62002; telephone number (618) 474-7500.
3
<PAGE>
THE COMPANY
Argosy Gaming Company ("Argosy" or the "Company") is a
multi-jurisdictional developer, owner and operator of riverboat casinos and
related entertainment facilities in the midwestern and southern United
States. The Company, through its subsidiaries, owns and operates the Alton
Belle Casino in Alton, Illinois, serving the St. Louis metropolitan market;
the Argosy Casino at Riverside in Riverside, Missouri, serving the Kansas
City metropolitan market; the Belle of Baton Rouge Casino in Baton Rouge,
Louisiana; and the Belle of Sioux City Casino in Sioux City, Iowa. The
Company manages, and has a 57.5% general partnership interest in, the Argosy
Casino Lawrenceburg in Lawrenceburg, Indiana, serving the Cincinnati
metropolitan market.
The Company was incorporated in Delaware in 1992. The Company's
principal executive offices are located at 219 Piasa Street, Alton, Illinois
62002, and its telephone number is (618) 474-7500.
RISK FACTORS
SUBSTANTIAL INDEBTEDNESS
At March 31, 1998, the Company's total long-term indebtedness was
approximately $443.6 million (including current maturities), its total
stockholders' equity was approximately $30.2 million and its total
capitalization was approximately $473.8 million. The ability of the Company
to meet its debt service requirements and to engage in various significant
corporate transactions that may be important to its business will be
dependent upon future operating performance, which is subject to financial,
economic, competitive, regulatory and other factors affecting the Company,
many of which are beyond the Company's control. These inherent uncertainties
are compounded as a result of the limited history of the riverboat gaming
industry. Since a substantial portion of its cash flow from operations must
be dedicated to the payment of interest on outstanding debt, there can be no
assurance that the Company's cash flow from operations will be sufficient to
meet its debt service requirements and other obligations or to repay its
indebtedness at maturity. If the Company is unable to generate sufficient
cash flow, it could be required to adopt one or more alternatives, such as
reducing or delaying planned capital expenditures, selling assets,
restructuring debt or obtaining additional capital. However, the Company's
ability to raise funds by selling assets is greatly restricted by the
Indenture, dated June 5, 1996 (the "Indenture"), under which its 13 1/4%
First Mortgage Notes due 2004 (the "Notes") were issued and its ability to
effect equity offerings is dependent on the Company's results of operations
and market conditions. There can be no assurance that any of such
alternatives will be feasible on satisfactory terms, and resorting to
alternative sources of funds could impair the Company's competitive position
and reduce its future cash flow.
COMPETITION
The casino gaming industry is characterized by intense competition
from a large number of participants, including riverboat casinos, dockside
casinos, land-based casinos, video lottery and poker machines in locations other
than casinos, Native American gaming and other forms of gaming in the United
States. Gaming industry competition is particularly intense in each of the
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markets where the Company operates. Historically, the Company has been an early
entrant in each of its markets; however, as its competitors have opened
properties in these markets, the Company's operating results in these markets
have been negatively affected. The Company expects that many of its competitors
will have more gaming industry experience, will be larger and will have
significantly greater financial and other resources than the Company. In
addition, certain of its direct competitors may have superior facilities and or
operating conditions in terms of (i) dockside versus cruising riverboat gaming,
(ii) the amenities offered by the competing casino and its related support and
entertainment facilities, (iii) convenient parking facilities, (iv) ease of
accessibility to the casino site, and (v) favorable tax or regulatory factors.
Given these factors, substantial increased competition could have a material
adverse affect on the Company's operations.
The Company's Alton Casino faces competition from four other
riverboat casino facilities currently operating in the St. Louis area and
expects the level of competition to remain intense in the future. The most
recent casino complex to open includes two independently owned facilities,
each of which operate two dockside vessels. This casino complex, which
increased gaming capacity in St. Louis by approximately 50%, opened in March
of 1997. The Company's Riverside Casino faces competition from four casino
companies in the Kansas City area that offer dockside gaming, two of which
offer two gaming vessels each. The Company's Baton Rouge Casino faces
competition from one casino located in downtown Baton Rouge, a nearby Native
American casino and multiple casinos throughout Louisiana. Currently, the
Company faces competition in Sioux City, Iowa from two riverboat casinos in
the Council Bluffs, Iowa/Omaha, Nebraska market. The Indiana Partnership
faces competition from one other riverboat casino in the Cincinnati market,
which opened in October 1996. There could be further competition in any
market in which the Company operates as a result of legislative changes or
other events. The Company expects each market in which it participates, both
current and prospective, to be highly competitive.
GAMING REGULATION
LICENSING AND REGULATION BY GAMING AND LOCAL AUTHORITIES. The
ownership and operation of casino gaming facilities are subject to extensive
state and local regulation. The states of Illinois, Missouri, Louisiana, Iowa
and Indiana and the applicable local authorities require licenses, findings of
suitability, registrations, permits and approvals to be held by the Company and
its subsidiaries as well as the officers and directors of the Company and its
subsidiaries. The Illinois Gaming Board, the Missouri Gaming Commission, the
Louisiana Gaming Control Board, the Iowa Racing and Gaming Commission and the
Indiana Gaming Commission (herein collectively referred to as "Applicable Gaming
Commissions") may, among other things, limit, condition, suspend, fail to renew
or revoke a license or approval to own an equity interest in the Company or any
of its subsidiaries, for any cause deemed reasonable by such licensing
authority. The suspension, failure to renew or revocation of any of the
Company's licenses or the levy on the Company of substantial fines or forfeiture
of assets would have a material adverse effect on the business of the Company.
In certain circumstances, the Applicable Gaming Commissions have the authority
to approve certain distributions from subsidiaries to the Company.
To date, the Company has obtained all governmental licenses,
registrations, permits and approvals necessary for the operation of its current
gaming activities. However, gaming licenses and related approvals are deemed to
be privileges under Illinois, Missouri, Louisiana, Iowa and
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Indiana law, and no assurances can be given that any new licenses, permits
and approvals that may be required in the future will be given or that
existing ones will not be revoked or fail to be renewed. In addition, the
loss of a license in one jurisdiction could trigger the loss of a license or
effect the Company's eligibility for a license in another jurisdiction.
The approval of the Applicable Gaming Commissions is required for any
material debt or equity financing. No assurance can be given that the Company
will obtain the required approvals for future financings.
RISK OF ADVERSE CHANGES IN LAWS AND REGULATIONS. Regulations with
respect to the conduct of gaming activities and the obligations of gaming
companies in any jurisdiction in which the Company has gaming operations are
subject to change and could impose additional operating, financial or other
burdens on the conduct of the Company's business. Moreover, legislation to
prohibit or limit gaming may be introduced in the future in states where gaming
has been legalized. The enactment of any such legislation or regulatory changes
in jurisdictions where the Company operates gaming facilities could have a
material adverse effect on the Company.
RISK OF LEGALIZATION OF GAMING JURISDICTIONS ADJACENT TO THE COMPANY'S
OPERATIONS. Casino gaming is currently prohibited in several jurisdictions
adjacent to Missouri, Iowa and Indiana. As a result, residents of these
jurisdictions, principally Kansas, Nebraska, Ohio and Kentucky, comprise a
significant portion of the patrons of the Company's casinos in Riverside,
Missouri, Sioux City, Iowa and Lawrenceburg, Indiana. The legalization of
casino gaming in Kansas would have a material adverse effect on the Company's
Riverside casino because residents of Kansas comprise a significant target
market. The legalization of casino gaming in Ohio or Kentucky would have a
material adverse effect on the Company's Lawrenceburg Casino because a
substantial portion of the Lawrenceburg Casino's customers are residents of Ohio
and Kentucky.
GAMING TAXATION AND FEES. The Company believes that the prospect of
significant additional tax revenue is one of the primary reasons why new
jurisdictions have legalized gaming. As a result, gaming operators are
typically subject to significant taxes and fees in addition to normal federal
and state corporate income taxes. Such taxes and fees are subject to increase
at any time. The Company pays substantial taxes and fees with respect to its
operations and will likely incur similar burdens in any other jurisdiction in
which it conducts gaming operations in the future. Any material increase, or
the adoption of additional taxes or fees, could have a material adverse effect
on the Company's future financial results.
CERTAIN RISKS UNDER THE LAWRENCEBURG CASINO PARTNERSHIP AGREEMENT
The Lawrenceburg Casino partnership agreement provides that the
Company's wholly-owned subsidiary, The Indiana Gaming Company, can be removed as
general partner of the partnership by the limited partners under certain limited
circumstances, including: (i) a material breach (after notice and expiration of
applicable cure periods) of certain material provisions of the partnership
agreement dealing with such things as distributions to partners or the failure
to obtain the required consent of the limited partners for certain major
decisions; (ii) conviction of embezzlement or fraud; (iii) certain bankruptcy
events; (iv) if The Indiana Gaming Company's
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partnership interest is less than 40% due to sales or dilution for failure to
pay required capital; (v) a final unappealable judgment against The Indiana
Gaming Company in excess of $25 million which is uninsured and remains
unsatisfied, unreleased or unstayed for 180 days; (vi) certain acts
constituting "gross mismanagement;" (vii) if The Indiana Gaming Company fails
to fund project costs in excess of $215 million (after expiration of
applicable notice and cure periods); and (viii) if the Trustee under the
Notes were to foreclose on the Company's pledge of its partnership interest
in the partnership. Upon removal as general partner, the general partnership
interest of The Indiana Gaming Company becomes a "special limited partner"
interest with rights to partner distributions but only limited voting rights
on partnership matters. Also, if the reason for the removal is an event
described in clause (i), (ii), (iii), (v), (vi) or (viii) above, the limited
partners may acquire all, but not less than all, of The Indiana Gaming
Company's interest for the fair market value thereof determined by an
appraisal process.
The Lawrenceburg partnership agreement provides that: (i) after the
third anniversary date of commencement of operations at the Lawrenceburg
Casino (December 10, 1999), each limited partner has the right to sell its
interest to the other partners (pro rata in accordance with their respective
percentage interests) or (ii) at any time after a deadlock by the parties
with respect to significant items in any annual operating budget of the
partnership for budget year 1999 and thereafter, any partner has a right to
sell its interest to the other partners (the limited partner pursuant to
clause (i) and the partner desiring to sell pursuant to clause (ii) are
hereinafter referred to as a "Selling Partner" and the non-selling partners
are hereinafter referred to as the "Non-Selling Partners"). The partnership
agreement provides that after the Selling Partner gives notice of its intent
to sell, the Selling Partner and Non-Selling Partners shall have 60 days to
attempt in good faith to agree to a purchase price. If within such period of
time no such agreement is reached, then the Selling Partner's interest shall
be appraised pursuant to an appraisal process to determine the fair market
value thereof. After the fair market value of the Selling Partner's interest
is determined by the appraisal process, the Non-Selling Partners have 60 days
to reject such sale at that price, and if the Non-Selling Partners decline to
purchase the interest of the Selling Partner at the appraisal price, then the
general partner is to solicit bids and sell all of the assets of the
Partnership within twelve months to the highest bidder and Indiana Gaming
L.P. will be dissolved. No assurances can be given that The Indiana Gaming
Company, if it is a Non-Selling Partner, will have or will be able to obtain
sufficient funds to acquire any Selling Partner's interest in the
circumstances provided for above or that The Indiana Gaming Company will
choose to make such purchase and therefore the assets of the partnership
would have to be sold to the highest bidder as provided above. In addition,
the partnership agreement provides all partners with a right of first refusal
on transfers of partnership interest. A foreclosure by the Trustee under the
Indenture on the Company's pledge of its partnership interest shall be deemed
a transfer giving rise to a right of first refusal.
LOSS OF A RIVERBOAT OR DOCKSIDE FACILITY FROM SERVICE; FLOODING
The Company's revenues are generated primarily by its gaming
operations conducted on riverboat casinos, which are supplemented by dockside
entertainment and support facilities. A riverboat or dockside facility could be
lost from service for a variety of reasons, including casualty, forces of
nature, mechanical failure or extended or extraordinary maintenance or
inspection. In addition, U.S. Coast Guard regulations require a hull inspection
for all riverboats at five-year
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intervals. To comply with the inspection requirement, which could take a
substantial amount of time, the riverboats must be taken to a U.S. Coast
Guard approved dry docking facility. The Belle of Sioux City riverboat was
removed from service on April 13, 1996 for such a hull inspection. The
riverboat arrived at an approved dry docking facility on April 16, 1996,
passed its inspection and returned to service on May 9, 1996. No
interruption in gaming operations occurred in Sioux City as a result of the
hull inspection process, as the Company temporarily transferred gaming
operations to the original Alton Belle prior to removing the Bell of Sioux
City from service. The Belle of Baton Rouge and Argosy Casino in Riverside
riverboats are due for this inspection in mid-1999.
The severe flooding which occurred along the Mississippi River in
metropolitan St. Louis during the summer of 1993 caused the Company to
experience decreased attendance and increased operating expenses. The
Company again experienced flooding in May 1995 at both the Alton, Illinois and
Riverside, Missouri sites; however, the flooding did not result in any
significant decrease in attendance or increase in expenses at either site.
All of the Company's riverboat casino sites are vulnerable to the risk of
future flooding. Any flood or other severe weather condition that might
occur in the future could adversely affect attendance and increase expenses,
and could lead to the loss of use of a riverboat or dockside facility for an
extended period. The loss of any riverboat from service, the inability to
use a dockside facility or the loss of parking or land based facilities could
have a material adverse effect on the Company's financial results.
PENDING INTERNAL REVENUE SERVICE AUDIT
On November, 1, 1994, the Company received a Notice of the
beginning of an Administrative Proceeding from the Internal Revenue Service
("IRS") for the 1992 and 1993 tax years of Metro Entertainment & Tourism,
Inc. ("Metro"). Metro was merged with and into the Company immediately prior
to its initial public offering in February 1993. Metro and J. Connors Group,
Inc. ("Connors") were the partners of Alton Riverboat Gambling Partnership
("ARGP") which until the Company's initial public offering owned and operated
the Alton, Illinois riverboat casino. The IRS has proposed in a 30-day
letter certain adjustments with respect to the Company for its 1993 tax year.
The IRS has also proposed in a 60-day letter adjustments for ARGP that flow
through to Metro. Finally, on March 16, 1998 the IRS issued a 60-day letter
to Metro for its tax years ending December 1992 and February 1993. The
principal issues raised by the IRS in the Metro 60-day letter involve the
status of Metro as a Subchapter S Corporation and the deductibility of the
$8.5 million accommodation fee paid to William McEnery in 1992 and 1993. The
total federal tax liability asserted by the IRS against the Company resulting
from these proposed adjustments is approximately $11.0 million including
interest through March 31, 1998 but excluding penalties, if any. The Company
intends to protest these proposed adjustments to the Appeals Office of the
IRS and vigorously contest these proposed adjustments. While the Company
believes the predecessor entity has legal authority for its position that it
is not subject to federal and certain state income taxes because it met the
Subchapter S Corporation requirements, no assurances can be given that its
position will be upheld. This contingent tax liability could have a material
adverse effect on the Company's results of operations, financial position and
cash flows. No provision has been made for this contingency in the Company's
consolidated financial statements.
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SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS
The Company has granted registration rights to the holders of the
Preferred 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. On June
16, 1998, using the assumptions set forth below, the 800 Preferred Shares issued
on that date were convertible into a total of 2,469,135 shares of Common Stock
and the 800 Warrants issued on that date were exercisable to purchase a total of
292,612 shares of Common Stock. The Preferred 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.
Thus, 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 Preferred Shares and the exercise of the
Warrants, in full. Those numbers are based on an assumed floating conversion
price of $3.24 per share and a fixed conversion price and a warrant exercise
price of $3.89 per share.
Subject to fulfillment of certain terms and conditions, the holders of
the Preferred Shares have the right to purchase, and the Company has the right
to require the holders of the Preferred Shares to purchase, up to an additional
800 Preferred Shares and 800 Warrants in the aggregate. The fixed conversion
price for those Preferred 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 Preferred Shares and 800 Warrants outstanding on June 16, 1998.
By exercising their registration rights, converting the Preferred
Shares into Common Stock and purchasing Common Stock upon exercise of the
Warrants, the holders of the Preferred 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.
In addition, future sales of shares by existing stockholders could
adversely affect the prevailing market price of the Common Stock. Substantially
all of the 24,498,333 outstanding shares of Common Stock outstanding as of
February 27, 1998 were freely tradeable in the public market, of which
10,012,181 shares held by affiliates of the Company were eligible for immediate
sale in the public market subject to volume and other restrictions of Rule 144;
however, certain of those affiliates have registration rights with respect to a
total of 9,928,681 of such shares of Common Stock which, if exercised, would
permit those shares to be sold without the volume and other restrictions of Rule
144.
9
<PAGE>
PRICE RANGE OF COMMON STOCK
The Common Stock is listed and traded on the New York Stock Exchange.
The following table sets forth the high and low prices of the Common Stock for
each full quarterly period for the Company's two most recent fiscal years and
the current fiscal year.
<TABLE>
<CAPTION>
SALES PRICE
LOW HIGH
<S> <C> <C>
CALENDAR 1996
First Quarter $6 11/16 $9 1/4
Second Quarter 7 8 3/4
Third Quarter 4 1/4 7 3/4
Fourth Quarter 4 1/2 7 1/8
CALENDAR 1997
First Quarter $3 3/8 $5 1/4
Second Quarter 2 3/4 4
Third Quarter 2 15/16 5 3/4
Fourth Quarter 3 1/16 5 5/8
CALENDAR 1998
First Quarter $3 1/4 $4 1/2
Second Quarter 2 3/4 4 1/8
</TABLE>
The last reported sale price for the Common Stock on ________, 1998
was $_____ per share.
SELLING STOCKHOLDERS
The shares of Common Stock offered by this Prospectus (i) are issuable
to the holders of the Preferred Shares upon conversion thereof, if converted,
and to the holders of the Warrants upon exercise thereof, if exercised, and (ii)
are offered for the account of the Selling Stockholders. The Preferred Shares
and/or the Warrants may be transferred or assigned by the holders thereof
between the date of this Prospectus and the date of conversion, if converted, or
the date of exercise, if exercised. In addition, the number of shares of Common
Stock issuable to the holders of the
10
<PAGE>
Preferred Shares upon conversion will be determined based upon the applicable
conversion price at the time of conversion and the number of shares of Common
Stock issuable to the holders of the Warrants upon exercise will be
determined based upon the applicable exercise price at the time of exercise.
The Company has agreed to register a specified number of Shares for
resale by the Selling Stockholders. The number of Shares shown in the
following table as being beneficially owned by the Selling Stockholders does
not include such presently indeterminate number of additional shares of
Common Stock as may be issuable upon conversion of the Preferred Shares based
upon fluctuations in the conversion price of the Preferred Shares, but which
shares are, in accordance with Rule 416 under the Securities Act, included in
the Registration Statement of which this Prospectus forms a part.
The Shares covered by this Prospectus may be offered from time to time
by the Selling Stockholders named below:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES OF COMMON NUMBER OF SHARES OF COMMON
STOCK BENEFICIALLY OWNED AS OF NUMBER OF SHARES OF COMMON STOCK BENEFICIALLY OWNED
NAME OF SELLING STOCKHOLDER ____________, 199__ (1)(2) STOCK OFFERED HEREBY(3) AFTER OFFERING (4)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
AGR Halifax Fund, Ltd. ____________ ____________ 0
Heracles Fund ____________ ____________ 0
Leonardo, L.P. ____________ ____________ 0
Themis Partners L.P. ____________ ____________ 0
Ramius Fund, Ltd. ____________ ____________ 0
Raphael, L.P. ____________ ____________ 0
GAM Arbitrage
Investments, Inc. ____________ ____________ 0
AG Super Fund
International , L.P. ____________ ____________ 0
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities and includes any securities
which the person has the right to acquire within 60 days of ____________,
199__ through the conversion or exercise of any security or other right.
(2) Beneficial ownership is determined as of ____________, 199__ and is
based upon a conversion price of the Preferred Shares equal to
$____________ (which is the average of the five lowest closing bid
prices of the Common Stock for the 30 consecutive trading days ended
____________, 199__). The actual number of shares of Common Stock
issuable upon conversion of the Preferred Shares is that number of
shares of Common Stock equal to the quotient of (i) the aggregate stated
value of the Preferred Shares ($10,000 per share), plus any accrued and
unpaid premium of 4% per annum divided by (ii) the conversion price.
The conversion price is the lesser of (a) $_____ per share, or (ii) the
market price of the Common Stock, where the market price is the average
of the five lowest closing bid prices for the Common Stock for the 30
consecutive trading days immediately preceding such date of
determination. No holder of Preferred Shares or Warrants is entitled to
convert or exercise such securities to the extent that the shares to be
received by such holder upon such conversion or exercise would cause
such holder in the aggregate to beneficially own more than 4.99% of the
Common Stock of the Company (other than shares deemed to be beneficially
owned through ownership of the Preferred Shares), except upon 61 days
prior notice to the Company. In addition, pursuant to the rules of The
New York Stock Exchange, in the absence of shareholder approval, the
aggregate number of shares issuable to the Selling Stockholders upon the
conversion of the Preferred Shares may not exceed 19.99% of the
outstanding Common Stock as of ____________, 199__ (approximately
____________ shares). Unless such shareholder approval is obtained,
none of the Selling Stockholders will be able to acquire more than its
proportionate share of such maximum amount. The Company may be required
to redeem any Preferred Shares which may not be converted because of
such limitation.
(3) Represents the allocation among the Selling Stockholders of 5,000,000
shares of Common Stock potentially issuable as of ____________, 199___,
upon conversion and exercise of the 800 Preferred Shares and related
Warrants held by the Selling Stockholders which the Company is
registering pursuant to the Registration Rights Agreement between the
Company and the Selling Stockholders. The number of shares of Common
Stock registered pursuant to the Registration Statement on behalf of the
Selling Stockholders holding Preferred Shares and Warrants and the
number of Shares offered hereby by such holders have been determined by
agreement between the Company and such Selling Stockholders. Because the
number of Shares that will ultimately be issued upon conversion of the
Preferred Shares or exercise of the Warrants is dependent, subject to
certain limitations, upon the average of certain closing bid prices of
the Common Stock prior to conversion, as described in footnote (2)
above, and certain antidilution adjustments, such number of shares (and
therefore the number of shares offered hereby) cannot be determined at
this time. The number of shares being offered by the Selling
Stockholders holding the Preferred Stock, in accordance with Rule 416
under the Securities Act, also includes such presently indeterminate
number of additional shares as may be issuable upon conversion of the
Preferred Shares, based upon fluctuations in the conversion price of the
Preferred Shares and future antidilution adjustments in accordance with
the terms of the Certificate of Designation for the Preferred Shares and
the Warrants.
(4) Gives effect to the conversion of all of the Preferred Shares and exercise
of all of the Warrants and sale of the shares of Common Stock upon such
conversion or exercise.
(5) ____________ is the trading manager of each of [NAME OF FUND] and
consequently has voting control and investment discretion over
securities held by the Selling Stockholders. The ownership for each of
the Selling Stockholders does not include the ownership information for
the other Selling Stockholders. ____________ and each of the Selling
Stockholders disclaims beneficial ownership of the Shares held by the
other Selling Stockholders.
DESCRIPTION OF CAPITAL STOCK
The Company's Certificate of Incorporation authorizes the issuance of
60,000,000 shares of Common Stock par value $.01 per share, of which 24,498,333
shares were outstanding on June 30, 1998; 10,000,000 shares of preferred stock,
par value $.01 per share, of which 800 shares were outstanding on June 30, 1998;
and 85 shares of redeemable common stock, par value $.01 per share, of which
none is outstanding as of the date of this Prospectus.
11
<PAGE>
COMMON STOCK
Holders of the Common Stock are entitled to one vote for each share held of
record, in person or by proxy, at all meetings of the stockholders and on all
propositions before such meetings. The Common Stock does not have cumulative
voting rights in the election of directors. Holders of the Common Stock have no
preemptive, subscription, redemption or conversion rights. All outstanding
shares of Common Stock are fully paid and nonassessable. Holders of Common
Stock are entitled to such dividends as may be declared by the Board of
Directors out of funds legally available therefor. In the event of liquidation,
dissolution or winding up of the affairs of the Company, the assets remaining
after provision for payment of creditors and after distribution in full of the
preferential amount to be distributed to the holders of shares of any preferred
stock are distributable pro rata among holders of Common Stock.
The transfer agent and registrar of the Common Stock is The Harris Trust
and Savings Bank, P. O. Box A3504, Chicago, Illinois 60690-9502.
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 June 30,
1998, 800 Series A Shares were outstanding. Following is a description of
certain provisions of the Certificate of Designations, Preferences and Rights of
Series A Convertible Preferred Stock of Argosy Gaming Company (the "Certificate
of Designations").
STATED VALUE - The stated value of the Series A Shares is $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
dividends. 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 dividends or (ii) the product of the conversion rate
at such time and the closing bid price per share of Common Stock at such time.
The Company has the right, subject to the satisfaction of conditions set forth
in the Certificate of Designations, to redeem any or all Series A Shares at any
time at a price
12
<PAGE>
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 dividends.
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 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 dividends 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.
13
<PAGE>
PLAN OF DISTRIBUTION
The Common Stock offered by this Registration Statement is being offered
on behalf of the Selling Stockholders. Such Common Stock may be sold or
distributed from time to time by the Selling Stockholders, or by donees or
transferees of, or other successors in interest to, the Selling Stockholders,
directly to one or more purchasers or through brokers, dealers or
underwriters who may act solely as agents or may acquire such Common Stock as
principals, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, at negotiated prices, or at fixed
prices, which may be changed. The sale of the Common Stock offered hereby
may be effected in one or more of the following methods: (i) ordinary
brokers' transactions; (ii) transactions involving cross or block trades or
otherwise on The New York Stock Exchange; (iii) purchases by brokers, dealers
or underwriters as principal and resale by such purchasers for their own
accounts pursuant to this Prospectus; (iv) "at the market" to or through
market makers or into an existing market for the Common Stock; (v) in other
ways not involving market makers or established trading markets, including
direct sales to purchasers or sales effected through agents; (vi) through
transactions in options, swaps or other derivatives (whether exchange-listed
or otherwise); (vii) in privately negotiated transactions; (viii) to cover
short sales; or (ix) any combination of the foregoing.
From time to time, one or more of the Selling Stockholders may pledge,
hypothecate or grant a security interest in some or all of the Shares owned
by them, and the pledgees, secured parties or persons to whom such securities
have been hypothecated shall, upon foreclosure in the event of default, be
deemed to be Selling Stockholders hereunder. The number of Selling
Stockholders' Shares beneficially owned by those Selling Stockholders who so
transfer, pledge, donate or assign Selling Stockholders' Shares will decrease
as and when they take such actions. The plan of distribution for Selling
Stockholders' Shares sold hereunder will otherwise remain unchanged, except
that the transferees, pledgees, donees or other successors will be Selling
Stockholders hereunder. In addition, a Selling Stockholder may, from time to
time, sell short the Common Stock, and in such instances, this Prospectus may
be delivered in connection with such short sales and the Shares offered
hereby may be used to cover such short sales.
A Selling Stockholder may enter into hedging transactions with
broker-dealers and the broker-dealers may engage in short sales of the Common
Stock in the course of hedging the positions they assume with such Selling
Stockholder, including, without limitation, in connection with distributions
of the Common Stock by such broker-dealers. A Selling Stockholder may also
enter into option or other transactions with broker-dealers that involve the
delivery of the Shares to the broker-dealers, who may then resell or
otherwise transfer such Shares. A Selling Stockholder may also loan or
pledge the Shares to a broker-dealer and the broker-dealer may sell the
Shares so loaned or upon a default may sell or otherwise transfer the pledged
Shares.
Brokers, dealers, underwriters or agents participating in the
distribution of the Shares as agents may receive compensation in the form of
commissions, discounts or concessions from the Selling Stockholders and/or
purchasers of the Common Stock for whom such broker-dealers may act as agent,
or to whom they may sell as principal, or both (which compensation as to a
particular broker-dealer may be less than or in excess of customary
commissions). The Selling Stockholders and any broker-dealers who act in
connection with the sale of the Shares hereunder may be deemed to be
"Underwriters" within the meaning of the Securities Act, and any commissions
they receive and proceeds of any sale of the Shares may be deemed to be
underwriting discounts and commissions under the Securities Act. Neither the
Company nor any Selling Stockholders can presently estimate the amount of
such compensation. The Company knows of no existing arrangements between any
Selling Stockholders, any other stockholder, broker, dealer, underwriter or
agent relating to the sale or distribution of the Shares.
The Company will pay substantially all of the expenses incident to the
registration, offering and sale of the Shares to the public other than
commissions or discounts of underwriters, broker-dealers or agents. The
Company has also agreed to indemnify the Selling Stockholders and certain
related persons against certain liabilities, including liabilities under the
Securities Act.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company, the Company has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities
Act and is therefore, unenforceable.
The Company has advised the Selling Stockholders that during such time
as they may be engaged in a distribution of the Shares included herein they
are required to comply with Regulation M promulgated under the Exchange Act.
With certain exceptions, Regulation M precludes any Selling Stockholder, any
affiliated purchasers, and any broker-dealer or other person who participates
in such distribution from bidding for or purchasing, or attempting to induce
any person to bid for or purchase any security which is the subject of the
distribution until the entire distribution is complete. Regulation M also
prohibits any bids or purchases made in order to stabilize the price of a
security in connection with the distribution of that security. All of the
foregoing may affect the marketability of the Shares.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby and certain
legal matters will be passed upon for the Company by Winston & Strawn, Chicago,
Illinois.
14
<PAGE>
EXPERTS
The consolidated financial statements of Argosy Gaming Company
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1997, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon incorporated by reference therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution of the
securities being registered, other than underwriting discounts and commissions,
are estimated to be:
<TABLE>
<CAPTION>
<S> <C>
SEC Filing fee . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,720
NYSE Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $17,500
Printing and Engraving . . . . . . . . . . . . . . . . . . . . . . . $15,000
Accounting Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . $
Legal Fees and Expenses. . . . . . . . . . . . . . . . . . . . . . . $35,000
Blue Sky Fees and Expenses . . . . . . . . . . . . . . . . . . . . . $
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . $
_______
Total . . . . . . . . . . . . . . . . . . . . . . . $
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
(the "GCL") permits a corporation to indemnify its directors and officers
against expenses (including attorney's fees), judgments, fines and amounts
paid in settlements actually and reasonably incurred by them in connection
with any action, suit or proceeding brought by third parties, if such
directors or officers acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interests of the corporation
and, with respect to any criminal action or proceeding, had no reason to
believe their conduct was unlawful. In a derivative action, i.e., one by or
in the right of the corporation, indemnification may be made only for
expenses actually and reasonably incurred by directors and officers in
connection with the defense or settlement of an action or suit, and only with
respect to a matter as to which they shall have acted in good faith and in a
manner they reasonably believed to be in or not opposed to the best interest
of the corporation, except that no indemnification shall be made if such
person shall have been adjudged liable to the corporation, unless and only to
the extent that the court in which the action or suit was brought shall
determine upon application that the defendant officers or directors are
reasonably entitled to indemnity for such expenses despite such adjudication
of liability.
Section 102(b)(7) of the GCL provides that a corporation may
eliminate or limit the personal liability of a director to the corporation or
its stockholders for monetary damages for breach of fiduciary duty as a
director, provided that such provision shall not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty
to the corporation or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the GCL or (iv) for any transaction from
which the director derived an improper personal benefit. No such provision
shall eliminate or limit the liability
II-1
<PAGE>
of a director for any act or omission occurring prior to the date when such
provision becomes effective.
Article Eighth of the Company's Certificate of Incorporation and
Article VIII of the Company's By-laws provide that the Company shall indemnify
its directors and officers to the fullest extent permitted by law. Article
Seventh of Company's Certificate of Incorporation provides that no director
shall be personally liable for any breach of fiduciary duty; however, such
provision does not eliminate liability as otherwise provided in the GCL.
The Company has purchased insurance which insures (subject to certain
terms and conditions, exclusions and deductibles) the Company against certain
costs which the Company might be required to pay by way of indemnification to
its directors or officers under its Certificate of Incorporation or By-laws,
indemnification agreements or otherwise and protects individual directors and
officers from certain losses for which they might not be indemnified by the
Company.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
4.1 Securities Purchase Agreement dated as of June 12, 1998 (1)
5.1 Opinion of Winston & Strawn
23.1 Consent of Ernst & Young LLP
23.2 Consent of Winston & Strawn (see Exhibit 5.1)
24.1 Powers of Attorney (included on signature page of this
Registration Statement)
- -------------------
(1) Filed as Exhibit 4.17 to Registrant's Current Report on Form 8-K,
dated June 16, 1998, and incorporated herein by reference.
</TABLE>
ITEM 17. UNDERTAKINGS.
The Company hereby undertakes (1) to file, during any period in which
offers or sales are being made, a post-effective amendment to this Registration
Statement: (i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; (ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in this
Registration Statement; provided, however, that paragraphs 1(i) and 1(ii) do not
apply if this Registration Statement is on Form S-3, Form S-8 or Form F-3 and
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant to
Section 13 or Section
II-2
<PAGE>
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this Registration Statement; and (iii) to include any material
information with respect to the plan of distribution not previously disclosed
in this Registration Statement or any material change to such information in
this Registration Statement; (2) that, for the purpose of determining any
liability under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement, relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; (3) to remove
from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering; and (4) that, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Company's annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that
is incorporated by reference in this Registration Statement shall be deemed
to be a new registration statement, relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Company pursuant to the provisions described under
Item 15 above or otherwise, the Company has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by a director,
officer or controlling person of the Company in the successful defense of any
action, suit or proceeding) is asserted against the Company by such director,
officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Alton, State of Illinois on this 6th day of July,
1998.
ARGOSY GAMING COMPANY
By: /s/ Dale R. Black
-----------------------------------
Dale R. Black
Vice President
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James B. Perry and Dale R. Black and
each of them (with full power to each of them to act alone), his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all said attorneys-in-fact and
agents, or any of them, or their substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ James B. Perry Principal Executive July 6 , 1998
------------------------- Officer
James B. Perry
/s/ Dale R. Black Principal Financial July 6 , 1998
------------------------- Officer and Principal
Dale R. Black Accounting Officer
/s/ William F. Cellini Director July 6 , 1998
-------------------------
William F. Cellini
/s/ George L. Bristol Director July 6 , 1998
-------------------------
George L. Bristol
/s/ Edward F. Brennan Director July 6 , 1998
-------------------------
Edward F. Brennan
II-4
<PAGE>
/s/ Felix Lance Callis Director July 6 , 1998
-------------------------
Felix Lance Callis
/s/ Jimmy F. Gallagher Director July 6 , 1998
-------------------------
Jimmy F. Gallagher
/s/ William J. McEnery Director July 6 , 1998
-------------------------
William J. McEnery
/s/John B. Pratt, Sr., Director July 6 , 1998
-------------------------
John B. Pratt, Sr.
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ----------------------
<S> <C>
1.1 Securities Purchase Agreement dated as of June 12, 1998
(incorporated by reference) . . . . . . .
5.1 Opinion of Winston & Strawn . . . . . . . Filed Electronically
23.1 Consent of Ernst & Young LLP . . . . . . Filed Electronically
23.2 Consent of Winston & Strawn (See Exhibit 5.1)
24.1 Powers of Attorney (included on signature page of this
Registration Statement) . . . . . . . . .
</TABLE>
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF WINSTON & STRAWN]
July 6, 1998
Argosy Gaming Company
219 Piasa Street
Alton, Illinois 62002
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-3 under the
Securities Act of 1933, as amended (the "Registration Statement"), relating
to the offering by the holders thereof of up to 5,000,000 shares of Common
Stock, $.01 par value (the "Shares") of Argosy Gaming Company, a Delaware
corporation (the "Company"), issuable upon conversion of the Company's Series
A Convertible Preferred Stock (the "Preferred Stock") and upon exercise of
the related Warrants to Purchase Common Stock (the "Warrants"), we have
examined such corporate records and other documents, including the
Registration Statement, and have reviewed such matters of law as we have
deemed relevant hereto.
Based upon the foregoing, it is our opinion that all of such
Shares, when issued upon conversion of the Preferred Stock or upon exercise
of the Warrants in accordance with the respective terms thereof, will be duly
and validly issued and fully paid and non-assessable shares of Common Stock
of the Company.
We hereby consent to the filing of this opinion as an exhibit to
the Registration Statement and the reference to this firm in Prospectus
contained therein.
Very truly yours,
/s/ Winston & Strawn
WINSTON & STRAWN
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts"
in the Registration Statement (Form S-3) and related Prospectus of Argosy
Gaming Company for the registration of its common stock and to the
incorporation by reference therein of our reports dated February 13, 1998,
with respect to the consolidated financial statements of Argosy Gaming
Company incorporated by reference in its Annual Report (Form 10-K) for the
year ended December 31, 1997 and the related financial statement schedules
included therein, filed with the Securities and Exchange Commission.
Ernst & Young LLP
Chicago, Illinois
July 6, 1998
