UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __________)*
LS CAPITAL CORPORATION
f/k/a "Lone Star Casino Corporation"
(Name of Issuer)
Common Stock, par value $.01
(Title of Class of Securities)
501936108
(CUSIP Number)
Randall W. Heinrich
1000 Louisiana, Suite 6905
Houston, Texas 77002
713-951-9100
(Name, Address, and Telephone Number of Person Authorized
to Receive Notices and Communications)
October 1, 1996
(Date of Event which Requires Filing of this Statement)
If this filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4) check the following
box [ ].
Check the following box if a fee is being paid with this statement [ ]. (A
fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five
percent or less of such class.) (See Rule 13d-7.)
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
SCHEDULE 13D
CUSIP No. 501936108
__________________________________________________________________
1) Names of Reporting Person
Paul J. Montle
S.S. or I.R.S. Identification No. of Above Person
###-##-####
__________________________________________________________________
2) Check the Appropriate Box if a Member of a Group
(See Instructions)
(a) [ ]
(b) [ ]
__________________________________________________________________
3) SEC Use Only
__________________________________________________________________
4) Source of Funds:
OO
__________________________________________________________________
5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e)
N/A
__________________________________________________________________
6) Citizenship or place of Organization:
UNITED STATES
__________________________________________________________________
(7) Sole Voting Power
Number of 2,603,461
Shares Bene- ______________________________________________________
ficially (8) Shared Voting Power
owned by -0-
Each Report- ______________________________________________________
ing Person (9) Sole Dispositive Power
With 2,603,461
__________________________________________________________________
(10) Shared Dispositive Power
-0-
__________________________________________________________________
11) Aggregate Amount Beneficially Owned by Each
Reporting Person:
2,603,461
__________________________________________________________________
12) Check if the Aggregate Amount in Row (11) excludes
certain shares:
[X]
__________________________________________________________________
13) Percent of Class Represented by Amount in Box (11):
33.7%
__________________________________________________________________
14) Type of Reporting Person
IN
ITEM 1. Security and Issuer
The class of equity securities to which this statement relates is the
common stock, par value $.01 per share (the "Common Stock") issued by
LS Capital Corporation, a Delaware corporation f/k/a "Lone Star Casino
Corporation" (the "Company"), which has its principal executive offices at
15915 Katy Freeway, Suite 250, Houston, Texas 77094.
ITEM 2. Identity and Background
This Statement is being filed by Paul J. Montle (the "Reporting
Person"), whose principal business address is 15915 Katy Freeway, Suite
250, Houston, Texas 77094. The Reporting Person is principally engaged
as the President and Chief Executive Officer of the Company. The
Reporting Person is a United States citizen. During the last five years, the
Reporting Person has not been convicted in a criminal proceeding. During
the last five years, the Reporting Person has not has been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction
and, as a result of such proceeding, is or was subject to a judgment, decree
or final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
ITEM 3. Source and Amount of Funds or Other Consideration
The Reporting Person acquired the 2,549,480 shares of Common
Stock giving rise to the filing of this statement in satisfaction of amounts
owed by the Company to the Reporting Person in the aggregate amount
of $114,726.
ITEM 4. Purpose of Transaction
On June 17, 1996 at a Special Meeting of Stockholders, the
stockholders of the Company authorized issuances of Common Stock (the
"Discretionary Stock Issuances"), in the discretion of the Board of
Directors but subject to certain restrictions, to creditors of the Company
(including officers and directors of the Company) in satisfaction of
amounts owed by the Company to such creditors, whether in the form of
loans or accrued salaries. The Board of Directors of the Company
submitted the Discretionary Stock Issuances to the stockholder for their
consideration on the belief that the Discretionary Stock Issuances were a
means by which the Company could eliminate certain outstanding claims
that could be asserted against the Company at any time and by which the
Company could eliminate certain liabilities reflected on the Company's
financial statements. At the time that the Discretionary Stock Issuances
were approved by the Board of Directors and stockholders, the Company
did not have, and appeared as if it would not have for the foreseeable
future, financial resources sufficient to satisfy these or any other liabilities
of the Company.
Upon the terms and conditions approved by the Board of
Directors and stockholders, the Discretionary Stock Issuances could be
made for one year after stockholder approval to persons (including officers
and directors of the Company) owed amounts by the Company. The
persons to be issued Common Stock, the number of shares to be issued to
them, the terms, provisions and conditions upon which the Common Stock
would be issued and the documentation memorializing the issuances were
all within the sole discretion of the Board of Directors, subject to certain
restrictions. These restrictions required that any Discretionary Stock
Issuance to a director of the Company be approved by a majority of
directors other than the director to receive the Discretionary Stock
Issuance. These restrictions also required that the number of shares of
Common Stock being issued not have an aggregate market value at the
time of issuance exceeding the amount being satisfied by the Common
Stock if the Common Stock being issued were freely tradeable immediately
after issuance, or not have an aggregate market value at the time of
issuance twice the amount being satisfied by such issuance if the Common
Stock being issued were not freely tradeable immediately after issuance.
The rationale for distinguishing between freely and non-freely tradeable
stock was that the Company has generally received for the sale of non-
freely tradeable Common Stock only 50% of the then current market value
of freely tradeable Common Stock. The Discretionary Stock Issuances
were not subject to adjustments increasing or decreasing the number of
shares of Common Stock comprising them based on changes in the market
value of the Common Stock after the Discretionary Stock Issuances.
Pursuant to the general authorization of stockholders and the
specific authorization of the Board of Directors, the Company issued to
the Reporting Person 2,549,480 shares of non-freely tradeable Common
Stock on October 1, 1996 in satisfaction of $114,726 debt owed by the
Company to the Reporting Person. The preceding debt amount was
comprised of $70,425 in accrued salary owed to the Reporting Person (for
which the Reporting Person was issued 1,565,000 shares of Common
Stock) and $44,301 in principal and interest of a loan to the Company
from an Individual Retirement Account for the benefit of the Reporting
Person (for which 984,480 shares of Common Stock were issued for the
benefit of the Reporting Person). In addition to the foregoing, 435,000
shares of non-freely tradeable Common Stock were issued to other persons
by virtue of prior partial assignments of the Reporting Person's claim for
accrued salary. The Company still owes $29,774 in accrued salary to the
Reporting Person but no longer owes any loaned amounts to the
Reporting Person or any of his affiliates. The closing price for the
Common Stock on October 1, 1996 was $.09, and one-half of this closing
price (or $.045) was used in computing the number of shares of Common
Stock to which the Reporting Person was entitled to receive in connection
with the Discretionary Stock Issuance.
The Reporting Person intends to hold his shares of Common
Stock for investment, and does not have any present plans or proposals
which relate to or would result in: (i) any acquisition by any person of
additional securities of the Company, or any disposition of securities of the
Company; (ii) any extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its
subsidiaries; (iii) any sale or transfer of a material amount of assets of the
Company or any of its subsidiaries; (iv) any change in the present board
of directors or management of the Company, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board; (v) any material change in the present
capitalization or dividend policy of the Company; (vi) any other material
change in the Company's business or corporate structure; (vii) any changes
in the Company's charter, by-laws, or other instruments corresponding
thereto or other actions which may impede the acquisition of control of
the Company by any person; (viii) any delisting from a national securities
exchange or any loss of authorization for quotation in an inter-dealer
quotation system of a registered national securities association of a class
of securities of the Company; (ix) any termination of registration pursuant
to section 12(g)(4) of the Act of a class of equity securities of the
Company; or (x) any action similar to any of those enumerated above.
Notwithstanding the foregoing, the Reporting Person may
determine to change his investment intent with respect to the Company at
any time in the future. In reaching any conclusion as to his future course
of action, the Reporting Person will take into consideration various factors,
such as the Company's business and prospects, other developments
concerning the Company, other business opportunities available to the
Reporting Person, developments with respect to the business of the
Reporting Person, and general economic and stock market conditions,
including, but not limited to, the market price of the Common Stock. The
Reporting Person may, depending on other relevant factors, acquire
additional shares of Common Stock in open market or privately negotiated
transactions, dispose of all or a portion of his holdings of shares of
Common Stock or change his intention with respect to any or all of the
matters referred to in this Item.
ITEM 5. Interest in Securities of the Issuer
The Reporting Person individually owns 2,553,281 shares of
Common Stock for which he is the beneficial owner. The Reporting
Person is also the beneficial owner of 48,580 shares of Common Stock held
by Travis Partnership, G.P., a general partnership in which the Reporting
Person has a 51.67% interest and a trust for the benefit of the Reporting
Person's children has a 15% interest. Moreover, the Reporting Person is
the beneficial owner of stock options currently exercisable to acquire 1,600
shares of Common Stock. Based on the foregoing, the Reporting Person
acknowledges that he is the beneficial owner of 2,603,461 shares of
Common Stock for which he has sole voting and investment power.
In addition to the above, trusts for the benefit of the Reporting
Person's children separately own an aggregate of 400,000 shares of
Common Stock, and ALDA F.L.P., a limited partnership having the
Reporting Person's children as limited partners, owns warrants to acquire
30,000 shares of Common Stock. Pursuant to Rule 13d-3 promulgated
under the Act, the Reporting Person may be deemed the beneficial owner
of the shares of Common Stock owned by the aforementioned trusts and
limited partnership. However, the filing of this statement shall not be
construed as an admission, for purposes of Section 13(d) and Regulation
D of the Act nor for any other purpose or under any other provision of
the Act or rules promulgated thereunder, that the Reporting Person is the
beneficial owner of such shares.
Except for the shares of Common Stock described in Item 3
above, the Reporting Person has not effected any transaction in the
Common Stock during the past 60 days.
ITEM 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
N/A
ITEM 7. Material to be Filed as Exhibits
No Exhibits are being filed with this statement.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: October 10, 1996
/S/ PAUL J. MONTLE
Name/Title__________________________________________
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS
OF FACT CONSTITUTE FEDERAL CRIMINAL VIOLATIONS
(SEE 18 U.S.C. 1001).
