AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 4, 1995.
REGISTRATION NO. 33-62431
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PRE-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SHOWBOAT, INC.
(Exact name of registrant as specified in its charter)
NEVADA 88-0090766
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2800 FREMONT STREET
LAS VEGAS, NEVADA 89104
(702) 385-9141
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
JOHN N. BREWER, ESQ.
KUMMER KAEMPFER BONNER & RENSHAW
3800 HOWARD HUGHES PARKWAY
SEVENTH FLOOR
LAS VEGAS, NEVADA 89109
(702) 792-7000
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT 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 SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND
EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
<PAGE>
SUBJECT TO COMPLETION, DATED DECEMBER 4, 1995
SHOWBOAT, INC.
150,000 Shares of Common Stock
This Prospectus relates to (i) warrants to purchase 150,000
shares of common stock (the "Warrants") of Showboat, Inc., a
Nevada corporation (the "Company"); and (ii) 150,000 shares (the
"Shares") of common stock, $1.00 par value (the "Common Stock"),
of the Company, issuable upon the exercise of the Warrants. The
Warrants and the Shares are being offered for sale, pursuant to
this Prospectus, from time to time, by or for the account of the
security holders named herein (the "Selling Security Holders").
See "Selling Security Holders." The Company will not receive any
of the proceeds of the offering, except for the receipt of the
exercise price of the Warrants upon exercise of the Warrants.
See "Use of Proceeds."
Each Warrant entitles its holder to purchase one share of
Common Stock of the Company at a price of $15.50. The exercise
price and the number of shares of Common Stock issuable upon the
exercise of each Warrant are subject to adjustment upon certain
events. The Warrants expire on May 6, 1999. The exercise price
of the Warrants will be payable, at the holder's option either in
cash, certified check or by surrender of debt or preferred equity
securities of the Company. In the alternative, each holder of
Warrants may exercise its right to receive Shares on a net basis,
without the exchange of any funds. See "Description of
Warrants."
The Selling Security Holders either directly, through agents
designated or to be designated from time to time by them, or
through underwriters or dealers, may sell the Warrants and Shares
from time to time on terms to be determined by the Selling
Security Holders at the time of sale. To the extent required by
applicable law, the specific amount of the Warrants and Shares
sold, the names of the Selling Security Holders, the respective
purchase price and public offering price, the name of such
agents, underwriters or dealers, and any applicable commission or
discount with respect to a particular offer will have to be set
forth in a Prospectus Supplement or an amendment to the
Registration Statement of which this Prospectus is a part. The
Selling Security Holders may also seek, to the extent permitted
by applicable laws, to sell the Warrants and Shares in
transactions under Rule 144 of the Securities Act of 1933, as
amended (the "Securities Act"). See "Selling Security Holders"
and "Plan of Distribution."
All expenses of this offering, other than commissions or
discounts of broker-dealers, will be borne by the Company. It is
estimated that such expense to be borne by the Company, including
accounting and legal fees) will approximate $21,750.
The Selling Security Holders and any broker-dealers, agents,
underwriters or dealers that participate with the Selling
Security Holders in the distribution of the Warrants and Shares
may be deemed to be "underwriters" within the meaning of the
Securities Act, and any commissions received by them and any
profit on the resale of the Warrants and Shares purchased by them
may be deemed to be underwriting commissions and discounts under
the Securities Act.
The Common Stock is listed on the New York Stock Exchange
(the "NYSE"). On November 28, 1995, the last reported sale price
of the Common Stock on the NYSE Composite Tape was $25 3/4. The
Warrants are not listed on any exchange.
The date of this Prospectus is , 1995
<PAGE>
SEE "RISK FACTORS" BEGINNING ON PAGE 9 FOR A DISCUSSION OF
CERTAIN FACTORS THAT PROSPECTIVE INVESTORS SHOULD CONSIDER PRIOR
TO AN INVESTMENT IN THE SHARES.
NEITHER THE NEVADA GAMING COMMISSION, THE NEVADA STATE GAMING
CONTROL BOARD, THE NEW JERSEY CASINO CONTROL COMMISSION
NOR ANY OTHER GAMING REGULATORY AGENCY WITH
WHICH THE COMPANY IS LICENSED OR HAS APPLIED
FOR A LICENSE, HAS PASSED UPON THE ADEQUACY
OR ACCURACY OF THIS PROSPECTUS OR THE
INVESTMENT MERIT OF THE SECURITIES
OFFERED HEREBY. ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL.
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 COMMIS-
SION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
NO DEALER, SALESMAN OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED
TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN
THOSE CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE
OFFERING MADE HEREBY. IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY, THE SELLING SECURITY HOLDERS, OR ANY UNDERWRITER.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OFFERED HEREBY IN
ANY JURISDICTION IN WHICH OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCE, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN
IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational reporting
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"). Such reports, proxy
statements and other information may be inspected and copied at
the public reference facilities maintained by the Commission at
Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549; at the New York Regional Office of the Commission, 7
World Trade Center, 13th Floor, New York, New York 10048; and at
the Chicago Regional Office of the Commission, Citicorp Center,
500 West Madison Street, Chicago, Illinois 60661. Copies of such
material can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Company's Common Stock is listed on the
NYSE. Reports, proxy statements, and other information
concerning the Company may be inspected at the offices of the
NYSE at 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a Registration
Statement on Form S-3 (the "Registration Statement") under the
Securities Act, with respect to the Warrants and the Shares
offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement and the
exhibits thereto, certain portions which have been omitted as
permitted by the regulations of the Commission. Statements
contained in this Prospectus or in any document incorporated by
reference as to the contents of any contract or other documents
referred to herein or therein are not necessarily complete and,
in each instance, reference is made to the copy of such documents
filed as an exhibit to the Registration Statement or such other
documents, which may be obtained from the Commission at its
principal office in Washington, D.C., upon payment of the fees
prescribed by the Commission. Each such statement is qualified
in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the
Company with the Commission, are hereby incorporated herein by
reference:
(i) The Company's Annual Report on Form 10-K for the Year
Ended December 31, 1994 (File No. 1-7123);
(ii) The Company's Quarterly Reports on Form 10-Q for the
Quarters Ended March 31, 1995, June 30, 1995, and
September 30, 1995 (File No. 1-7123); and
(iii) The Company's Current Reports on Form 8-K dated March
31, 1995, September 13, 1995, October 5, 1995 and
October 13, 1995 (File No. 1-7123).
In addition, each document filed by the Company pursuant to
Sections 13(a), 13(c), 14 or 15(b) of the Exchange Act subsequent
to the date of this Prospectus and prior to termination of the
offering of securities made hereby shall be deemed to be
incorporated by reference into this Prospectus and to be a part
hereof from the date such document is filed.
Any statement contained herein, or any document, all or a
portion of which is incorporated or deemed to be incorporated by
reference herein, shall be deemed to be modified or superseded
for purposes of the Registration Statement and this Prospectus to
the extent that a statement contained herein, or in any
subsequently filed document that also is or is deemed to be
incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
part of the Registration Statement or this Prospectus. All
information appearing in this
<PAGE>
Prospectus is qualified in its entirety by the information
and financial statements (including notes thereto) appearing in
the documents incorporated herein by reference. This Prospectus
incorporates documents by reference which are not presented
herein or delivered herewith. These documents (other than
exhibits thereto) are available without charge, upon written or
oral request by any person to whom this Prospectus has been
delivered, from H. Gregory Nasky, Secretary, Showboat, Inc.,
2800 Fremont Street, Las Vegas, Nevada 89104 (telephone
(702) 385-9141).
<PAGE>
THE COMPANY
AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE
REQUIRES, THE "COMPANY" OR "SHOWBOAT" REFERS TO SHOWBOAT, INC.
AND ITS SUBSIDIARIES. SEE "RISK FACTORS" FOR FACTORS A
PROSPECTIVE INVESTOR SHOULD CONSIDER IN EVALUATING THE COMPANY
BEFORE PURCHASING THE SHARES OR WARRANTS.
Showboat owns and operates the Atlantic City Showboat and
the Las Vegas Showboat. Showboat is also the largest single
shareholder at 26.3% of Sydney Harbour Casino Holdings Limited,
the parent company of Sydney Harbour Casino, the casino
licensee, and has an 85% interest in the management company which
operates Sydney Harbour Casino in Sydney, Australia. In addition
to its existing facilities, Showboat maintains an active
development program to identify and develop gaming opportunities
in existing and emerging gaming venues. Showboat has announced
expansion opportunities in East Chicago, Indiana and St. Louis,
Missouri. Showboat generated income from operations of
consolidated subsidiaries before depreciation and amortization
plus equity in earnings from all unconsolidated subsidiaries of
$80.2 million, $68.7 million and $68.5 million during the years
ended December 31, 1994, 1993 and 1992, respectively.
Showboat's marketing and operating strategy is to develop a
high volume of traffic through its casinos, emphasizing slot
machine play. The Atlantic City Showboat targets the drive-in
customer by providing competitive games and excellent service in
an attractive and convenient facility. Customers are attracted
to the Las Vegas Showboat by competitive slot machines, bingo,
moderately priced food and accommodations, a friendly "locals"
atmosphere and a 106-lane bowling center. The Atlantic City
Showboat was voted "best casino" in 1995 for the second straight
year by the readers of the Southern New Jersey COURIER POST, and
the Las Vegas Showboat was voted "best in Las Vegas" for slot
machines, video poker, bingo, keno and bowling in 1994 by the
readers of the LAS VEGAS REVIEW JOURNAL. At future venues,
Showboat will modify its marketing strategies to maximize casino
revenues by focusing on a specific venue's unique location and
demographics.
Showboat's development strategy is to identify new and
existing gaming opportunities with strong demographics, in
attractive and accessible locations, and which Showboat believes
will meet or exceed Showboat's return on investment objectives.
In 1993, Showboat created a Development and Management Services
Division to investigate and secure new properties in the United
States and around the world. Showboat's Development and
Management Services Division also provides management services to
support new facilities upon opening, including human resources,
marketing, design and construction, management information
systems, regulatory compliance and operating and financial
services.
THE ATLANTIC CITY SHOWBOAT
Since March 30, 1987, Showboat has operated the Atlantic
City Showboat fronting the Boardwalk in Atlantic City, New
Jersey. The Atlantic City Showboat is located at the eastern end
of the Atlantic City Boardwalk on approximately 13 acres. Access
to the Atlantic City Showboat's four-story podium, which houses
the casino and a 20-story hotel tower, is provided by two main
entrances, one on the Boardwalk and one on Pacific Avenue, which
runs parallel to the Boardwalk. Adjacent to the casino on
approximately 1.4 acres, is a newly constructed 17-story tower
containing additional casino space and 284 hotel rooms. The
Atlantic City Showboat has been designed to promote ease of
customer access to the casino and all other public areas of the
casino hotel.
The Atlantic City Showboat contains two public levels. Two
pairs of large escalators directly accessible from the two ground
level entrances and six elevators provide easy access to the
second level. Public areas located on the ground level, in
addition to the approximately 95,000 square feet of gaming space,
include a show lounge, two cocktail lounges, five restaurants, a
coffee shop, a pizza snack bar, an ice cream parlor and retail
<PAGE>
shopping. Public areas located on the second level include a
buffet, a coffee shop, a private Players Club, a beauty salon, a
health spa, approximately 2,000 square feet of space for video
games, approximately 27,000 square feet of meeting rooms,
convention, board room and exhibition space and the 60-lane
bowling center, including a snack bar and cocktail lounge.
The casino features approximately 3,200 slot machines, 88
table games, six poker tables, a horse race simulcast facility,
and a keno facility. The 20-story hotel tower features 516 guest
rooms and the adjacent 17-story tower features 284 guest rooms.
Many of the guest rooms in both towers have a view of the ocean.
Included in the number of guest rooms are 59 suites, 40 of which
have ocean-front decks. A nine-story parking garage is located
on-site at the Pacific Avenue entrance. The facility provides
self-parking for approximately 2,000 cars and a 14-bus depot
integrated within the casino podium and additional ground level
self-parking for approximately 950 cars. In addition, on-site
underground parking accommodates valet parking for approximately
600 cars. Two stories of the four story podium are occupied by
kitchens, storage for food and other perishables, surveillance
and security areas, an employee cafeteria, computer equipment and
executive and administrative offices.
The Atlantic City Showboat recently completed a three-phase,
$91.3 million expansion project which made the facility one of
the largest casinos in Atlantic City by adding 20,000 square feet
of casino space. The expansion also included the construction of
the new 284-room hotel tower.
Adjacent to the Atlantic Showboat is the Taj Mahal Casino
Hotel (the "Taj Mahal"). The Taj Mahal is the largest casino in
Atlantic City and is connected to both the Atlantic City Showboat
and Merv Griffin's Resorts International Casino Hotel by
pedestrian passageways. These three properties form an "uptown
casino complex" in which patrons can pass from property to
property, either on the ocean-front Boardwalk or through the
pedestrian connectors.
THE LAS VEGAS SHOWBOAT
The Las Vegas Showboat, when fully operational, includes an
approximately 78,000 square foot casino centrally located in a
453-room 18-story hotel, featuring a 106-lane bowling center, a
buffet, a coffee shop, a 1,300-seat bingo parlor garden, a
showroom and two specialty restaurants. At full capacity, the
casino features approximately 1,900 slot machines, 33 table games
and a keno facility. In addition, 8,300 square feet of meeting
room area is available with a seating capacity of 1,000 persons.
The Las Vegas Showboat covers approximately 26 acres and is
approximately two and one-half miles from the hotel casinos
located in downtown Las Vegas or on the "Strip."
Showboat has commenced an approximately $18.0 million
renovation of the Las Vegas Showboat which will improve the
quality of the casino space and which Showboat believes will
improve its competitive position. Approximately 30,000 square
feet or 40% of the casino space has been closed since July 1995
due to the renovation, which closure has caused a significant
disruption in operations and earnings at the Las Vegas Showboat.
The renovation is anticipated to be completed in December 1995.
The Las Vegas Showboat sponsors a variety of special events
designed to produce a high volume of traffic through the casino.
The Las Vegas Showboat sponsors events such as the Professional
Bowlers Association tour and Superstar Bingo, a high-stakes bingo
game, and provided the site for the annual High Rollers Million
Dollar Bowling Tournament. The Las Vegas Showboat also regularly
hosts small conventions and groups. In addition, the Las Vegas
Showboat provides a slot club, the Officer's Club, which is
designed to attract and reward frequent slot players at the Las
Vegas Showboat.
<PAGE>
THE SYDNEY HARBOUR CASINO
The Sydney Harbour Casino commenced gaming operations in an
interim casino in Sydney, Australia on September 13, 1995.
Through Showboat Australia Pty Ltd., the Company is the largest
single shareholder at 26.3% of Sydney Harbour Casino Holdings
Limited, the parent company of Sydney Harbour Casino, the casino
licensee, and has an 85% interest in the management company which
operates Sydney Harbour Casino.
The interim casino is located approximately one mile from
the Sydney central business district at Pyrmont Bay next to
Darling Harbour on Wharves 12 and 13, formerly a cruise ship
passenger terminal. The terminal building was renovated to
permit the operation of a casino containing approximately 500
slot machines and 150 table games. The interim casino is open
daily 24 hours per day. The interim casino also features four
restaurants, along with bars, a TAB sports lounge and Pier 13,
the casino store. The interim casino is easily accessed by
monorail, bus, ferry service and private car.
The opening marks the beginning of Sydney Harbour Casino's
monopoly as the only full-service casino in the State of New
South Wales for 12 years. This exclusive 12-year period is
included in the 99-year gaming license awarded to Sydney Harbour
Casino.
The permanent Sydney Harbour Casino is expected to be open
in 1998. The permanent Sydney Harbour Casino will feature
approximately 136,000 square feet of casino space, including an
approximately 20,000 square foot private gaming area to be
located on a separate level which will target a premium
clientele. The Sydney Harbour Casino will have approximately
1,500 slot machines and 200 table games. The permanent Sydney
Harbour Casino will also contain themed restaurants, cocktail
lounges, a 2,000 seat lyric theatre, a 700 seat cabaret style
theatre and extensive public areas. The permanent Sydney Harbour
Casino complex will include a 352 room hotel tower and an
adjacent condominium tower containing 139 privately-owned units
with full hotel services. The complex will also include
extensive retail facilities, a station for Sydney's proposed
light rail system, a bus terminal, docking facilities for
commuter ferries and parking for approximately 2,500 cars.
EXPANSION OPPORTUNITIES
Showboat is actively pursuing expansion opportunities in
emerging gaming markets throughout the United States and
internationally, including land-based casinos, riverboats and
Native American gaming. Announced expansion opportunities
include:
EAST CHICAGO, INDIANA
On January 31, 1994, the Showboat Marina Partnership, an
Indiana general partnership ("SMP"), was formed by Showboat
Indiana Investment Limited Partnership, a Nevada limited
partnership ("Showboat Indiana") wholly-owned by Showboat, and
Waterfront Entertainment and Development, Inc., an unrelated
Indiana corporation ("Waterfront"), for the purpose of applying
for a riverboat gaming license, designing, constructing, owning
and operating a riverboat casino ("East Chicago Riverboat") and
related facilities in East Chicago, Indiana. SMP is owned 55% by
Showboat Indiana and 45% by Waterfront. The East Chicago
Riverboat will be located approximately 25 minutes from downtown
Chicago, Illinois and approximately 3 miles from the Chicago city
limits. The Indiana Gaming Commission held licensing hearings
for SMP on October 19, 1995 and November 17, 1995. If a
certificate of suitability is issued to SMP, SMP anticipates that
gaming operations will commence in approximately one year
following the issuance of such certificate.
SMP expects to award a construction contract to construct
the East Chicago Riverboat and related facilities following the
issuance of the certificate of suitability by the Indiana Gaming
Commission and receipt of
<PAGE>
necessary approvals to commence construction. The Army Corps
of Engineers has issued a draft development permit to the City
of East Chicago for SMP's East Chicago Project. Preliminary
plans for the East Chicago Riverboat contemplated an
approximately 53,000 square feet of casino space on three levels
and will feature approximately 1,870 slot machines and
approximately 85 table games. The East Chicago Riverboat and
related facilities will cost approximately $170.0 million.
Subject to available resources, Showboat expects to invest
approximately $35.0 million. Under the current partnership
agreement Showboat will receive a 12% preferred return on its
investment prior to additional partnership distributions.
ST. LOUIS, MISSOURI
On May 1, 1995, the Southboat Limited Partnership, a
Missouri limited partnership ("SLP"), was formed by Showboat
Lemay, Inc., a Nevada corporation ("Showboat Lemay") wholly-owned
by Showboat, and Futuresouth, Inc., an unrelated Missouri
corporation ("Futuresouth"), for the purpose of designing,
developing, constructing, owning and operating a riverboat casino
(the "Southboat Casino") and related facilities (collectively,
the " Southboat Project") to be located on approximately 29 acres
at the southernmost portion of the St. Louis County Port
Authority Site on the Missouri River near Lemay, Missouri. The
Southboat Project is intended to contain a multi-level gaming and
entertainment facility within a New Orleans-themed barge complex.
The SLP is owned 80% by Showboat Lemay, the sole general partner,
and 20% by Futuresouth, the sole limited partner. The total cost
of the Southboat Project is anticipated to be approximately
$115.0 million. Subject to available financial resources,
Showboat expects to invest approximately $22.4 million in the SLP
and will help SLP obtain the remaining amount through debt
financings. On October 13, 1995, SLP entered into a lease and
development agreement with the St. Louis County Port Authority, a
public body corporate and politic of the state of Missouri, for
the lease of an approximately 29-acre parcel of real property
located along the Mississippi River in the Lemay area of St.
Louis County. On October 17, 1995, SLP submitted an application
to the Missouri Gaming Commission for the necessary gaming
licenses to operate the Southboat Project. In the event SLP is
granted a gaming license, it will commence gaming operations
approximately one year following the licensing hearings.
Showboat or an affiliate of Showboat shall provide
management services to the Southboat Project in exchange for a
management fee of 5 1/4% of the net gaming revenues of the
Southboat Project and an additional incentive fee of 20% of
earnings before any interest expense, income taxes, capital lease
rent, depreciation and amortization between $30.0 million to
$35.0 million and 10% of earnings before any interest expense,
income taxes, capital lease rent, depreciation and amortization
inexcess of $35.0 million.
The Company's principal executive offices are located at
2800 Fremont Street, Las Vegas, Nevada 89104. The telephone
number is (702) 385-9141.
<PAGE>
RISK FACTORS
EACH PROSPECTIVE INVESTOR SHOULD CAREFULLY CONSIDER THE
FOLLOWING FACTORS, AMONG OTHERS, IN EVALUATING THE COMPANY BEFORE
PURCHASING THE SHARES OR WARRANTS.
COMPETITION. The Atlantic City Showboat competes with 11
other casino hotels in Atlantic City containing, in the
aggregate, approximately 788,000 square feet of casino space and
approximately 8,400 rooms. In addition, the Atlantic City
Showboat competes with Foxwood's High Stakes Bingo and Casino on
the Mashantucket Pequot Indian Reservation in Ledyard,
Connecticut. Competition among casino hotels in Atlantic City is
intense. Casino hotels in Atlantic City generally compete on the
basis of promotional allowances, entertainment, advertising,
service provided to patrons, caliber of personnel, attractiveness
of the hotel and casino areas and related amenities.
The Las Vegas Showboat competes generally with approximately
130 casinos in Clark County, Nevada, which includes the cities of
Las Vegas, Henderson, Laughlin and Mesquite. Competition among
casinos in Clark County is intense. The Company has experienced
increased competition from new and existing Las Vegas hotel
casinos which have also sought to attract slot machine players
and Las Vegas-area residents, including construction of a new
hotel casino and renovation of another hotel casino which are
located on Boulder Highway near the Las Vegas Showboat. The
Company anticipates continuing increased competition for these
customers.
The Company believes that the growing legalization of casino
gaming in states other than New Jersey and Nevada, including
Colorado, Connecticut, Illinois, Iowa, Indiana, Louisiana,
Mississippi, Missouri, and South Dakota, and on various Indian
reservations has not to date had a material adverse impact on its
operations. The legalization of casino and other gaming venues
in states close to Nevada, particularly California, or in or near
New Jersey, particularly Delaware, Maryland, New York or
Pennsylvania, may have a material adverse effect on the Company's
business. The Company believes that gaming legislation has been
introduced, but not passed, in Pennsylvania and has received an
initial approval in New York.
The Company expects that many riverboat casinos, land-based
casinos, and Indian gaming will be licensed eventually throughout
the United States. Moreover, each announced opportunity will
compete with other nearby gaming operations. See "The Company -
Expansion Opportunities." Some of these gaming operations may be
owned by companies that are larger and have significantly greater
financial and other resources than the Company. Given these
factors, it is possible that substantial competition will arise
which could adversely affect the Company's existing and proposed
operations. The Company's ability to maintain its competitive
position may require the expenditure of significant funds on an
ongoing basis at all of its casino properties.
NEW GAMING JURISDICTIONS AND EXPANSION OPPORTUNITIES. The
Company is actively pursuing potential gaming opportunities in
certain jurisdictions where gaming has recently been legalized,
as well as jurisdictions where gaming is not yet, but is expected
soon to be legalized. There can be no assurance that legislation
to legalize gaming will be enacted in any additional
jurisdictions, that any properties in which the Company may have
invested will be compatible with any gaming legislation so
enacted, that legalized gaming will continue to be authorized in
any jurisdiction or that the Company will be able to obtain the
required licenses in any jurisdiction.
Furthermore, competition for the development of new gaming
opportunities has intensified as established and newly organized
gaming companies compete for a limited number of sites and
licenses. There can be no assurance that attractive
opportunities to develop new gaming operations will be available
to the Company.
The Company may invest in real property related to potential
gaming opportunities. Such investments are subject to the risks
generally incident to the ownership of real property, including
changes in economic
<PAGE>
conditions, environmental risks, governmental regulations and
other circumstances over which the Company may have little or no
control. There can be no assurance that the Company will be
able to recover its investment in any such property.
LEVERAGE AND DEBT SERVICE. As of September 30, 1995, the
Company had long-term obligations of approximately $392.2
million, inclusive of current maturities, and total stockholders'
equity of approximately $158.9 million.
The Company has significant interest expense. The Company's
ratio of earnings to fixed charges was 1.7 to 1 and 1.7 to 1 for
the year ended December 31, 1994 and the nine months ended
September 30, 1995, respectively. The Company's ability to
satisfy its obligations is dependent upon its future performance,
which will be subject to prevailing economic conditions and to
financial, business and other factors, including factors beyond
the control of the Company, affecting business operations of the
Company. If the Company is unable to generate sufficient cash
flow from operations in the future, it may be required to
refinance all or a portion of its existing debt or to obtain
additional financing. There can be no assurance that any such
refinancing would be possible or that any additional financing
could be obtained on terms that are favorable or acceptable to
the Company.
SYDNEY HARBOUR CASINO - RISK OF CONSTRUCTION DELAYS. The
Sydney Harbour Casino is currently being constructed at a total
cost, including licensing fees, of approximately A$1.2 billion.
The Company invested A$135.0 million in Sydney Harbour Casino.
The construction of the Sydney Harbour Casino will be subject to
the risks of delay and higher expenses to which construction
projects of this type are exposed due to factors such as shortage
of materials or skilled labor, structural engineering,
environmental and/or geological problems, work stoppages and
weather interference. Accordingly, there can be no assurance
that the Sydney Harbour Casino will be completed or completed in
a timely manner and within budget.
RISKS OF POTENTIAL DISRUPTIONS FROM CONSTRUCTION.
Construction on the $18.0 million renovation of the Las Vegas
Showboat commenced in July 1995 and is anticipated to be
completed in December 1995. The construction of the renovation
has caused a significant disruption in casino operations and
earnings, and has required the closure of approximately 30,000
square feet or 40% of the casino space at the Las Vegas Showboat.
There can be no assurance that the renovation will be completed
in a timely manner and within budget.
TAXATION. The Company believes that the prospect of
significant additional revenue is one of the primary reasons that
jurisdictions have legalized gaming. As a result, gaming
companies are typically subject to significant taxes and fees in
addition to normal federal and state income taxes, and 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 may conduct gaming operations in the future. In
addition, there have been suggestions from time to time to tax
all gaming establishments at the federal level. Any increase in
the Company's tax rates would adversely affect the Company.
LOSS OF A RIVERBOAT FROM SERVICE. A riverboat, such as the
proposed East Chicago and St. Louis Riverboats, could be lost
from service for a variety of reasons, including casualty,
mechanical failure or extended or extraordinary maintenance or
inspection. U.S. Coast Guard regulations require a hull
inspection for all riverboats at five-year intervals. To comply
with this inspection requirement, which could take a substantial
amount of time, the riverboats, that the Company may operate in
the future must be taken to a U.S. Coast Guard approved dry
docking facility.
HOTEL/GAMING BUSINESS. The Company is subject to the risks
inherent in the hotel and gaming operations business. Gaming
activity can vary significantly as a result of a number of
factors, including the
<PAGE>
competitive environment, hotel occupancy rate, and general
economic conditions, and is subject to substantial governmental
regulation. See "Regulatory Matters." Additionally, hotel and
gaming operations are subject to the imposition of special taxes
or assessments by regulatory bodies. Any new tax or assessment
may have an adverse impact on the Company's operations.
REGULATORY MATTERS. The ownership and operation of the Las
Vegas Showboat, the Atlantic City Showboat and the Sydney Harbour
Casino, and other gaming facilities which may be operated by the
Company in the future are subject to extensive regulation by
state and local gaming authorities in Nevada, New Jersey, New
South Wales, Australia and in other states and foreign countries
the Company may conduct business in the future (collectively, the
"Gaming Authorities"). The Company may be required to disclose
to the Gaming Authorities, upon request, the identities of the
Company's securityholders. The Gaming Authorities may, in their
discretion, (i) require securityholders of the Company to file
applications in states in which the Company does business;
(ii) investigate such securityholders; and (iii) require such
securityholders to be found suitable or qualified to own such
securities. Pursuant to the regulations of the Gaming
Authorities, the Company may be sanctioned, including the loss of
its approvals, if, without prior approval of the Gaming
Authorities, it (i) pays to the unsuitable or unqualified person
any dividend, interest or other distribution; (ii) recognizes any
voting right by such unsuitable or unqualified person in
connection with the securities; (iii) pays the unsuitable or
unqualified person remuneration in any form; or (v) makes any
payments to the unsuitable or unqualified person by way of
principal, redemption, conversion, exchange, liquidation, or
similar transaction. For a more detailed discussion of
regulatory matters, see "Business-Regulation and Licensing" in
Part I, Item 1 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1994.
DEVELOPMENT OF NEW FACILITIES. The development of any
significant new venture which requires the Company to make a
substantial capital investment may require additional debt or
equity financing. There can be no assurance that the cash flow
generated by the operations of the Company or any other new
venture will be sufficient to service any additional debt which
may be incurred in connection therewith. In addition there can
be no assurance that additional financing can be obtained which
is acceptable to the Company.
The opening of any new facility, such as the Sydney Harbour
Casino, or expansion of an existing facility will be contingent
upon the completion of construction, hiring and training of
experienced management and sufficient personnel and receipt of
all regulatory licenses, permits, allocations and authorizations.
The scope of the approvals required to construct and open a new
facility or expand an existing facility may be extensive, and the
failure to obtain such approvals could prevent or delay the
completion of construction or opening of all or part of such
facilities or otherwise affect the design and features of the
project. Major construction projects, such as the Sydney Harbour
Casino or another new casino development, entail significant
risks, including management's ability to control and manage such
projects effectively, shortages of materials or skilled labor,
engineering, environmental or regulatory problems, work
stoppages, weather interference and unanticipated cost increases.
Accordingly, there can be no assurance that any project,
including the Sydney Harbour Casino, will be completed on time or
within budget or that unanticipated delays or cost increases will
not have a material adverse effect on any project.
The Company is pursuing a number of gaming opportunities.
In many cases, the Company is competing against other gaming
companies, some of which may have greater financial resources.
There can be no assurance that these opportunities will be
realized by the Company. The Company reserves the right to cease
pursuing any of the gaming opportunities at any time.
<PAGE>
ABSENCE OF PUBLIC TRADING MARKET
The Warrants constitute a new issue of securities, have no
established trading market and may not be widely distributed.
The Commission has broad discretion to determine whether any
registration statement will be declared effective and may delay
or deny the effectiveness of any such registration statement
filed by the Company for a variety of reasons. Failure to have
the registration statement declared effective could adversely
affect the liquidity and price of the Warrants. If a market does
develop, the price of the Warrants may fluctuate and liquidity
may be limited. If a market for the Warrants does not develop,
purchasers may be unable to resell such securities for an
extended period of time, if at all.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the
sale of the Warrants and Shares which are being sold by the
Selling Security Holders. Any proceeds from the exercise of the
Warrants, to the extent that the Warrants are exercised, will be
used by the Company for general corporate purposes.
<PAGE>
PRICE RANGE OF COMMON STOCK AND DIVIDENDS
The Company's Common Stock has been listed on the NYSE since
May 30, 1984 under the symbol "SBO." The range of high and low
sales prices per share as reported on the NYSE Composite Tape,
and the dividends declared by the Company, for each quarter in
1993, 1994 and 1995 are as follows:
<TABLE>
<CAPTION>
Dividends
High Low declared
<S> <C> <C> <C>
Year ended December 31, 1993
Quarter ended March 31, 1993 24 5/8 15 3/8 .025
Quarter ended June 30, 1993 24 3/8 17 5/8 .025
Quarter ended September 30, 1993 21 1/2 15 3/8 .025
Quarter ended December 31, 1993 23 3/8 15 5/8 .025
Year ended December 31, 1994
Quarter ended March 31, 1994 21 16 1/4 .025
Quarter ended June 30, 1994 22 7/8 15 3/8 .025
Quarter ended September 30, 1994 17 7/8 13 1/8 .025
Quarter ended December 31, 1994 14 1/2 11 3/4 .025
Year ended December 31, 1995
Quarter ended March 31, 1995 15 3/4 13 1/2 .025
Quarter ended June 30, 1995 18 5/8 13 1/2 .025
Quarter ended September 30, 1995 24 3/8 17 1/2 .025
Quarter ended December 31, 1995 26 1/2 21
(through November 28, 1995)
</TABLE>
On November 28, 1995, the closing price of the Company's
Common Stock on the NYSE was 25 3/4. There were approximately
1,796 holders of record of the Company's Common Stock as of
November 27, 1995.
The Company has paid quarterly dividends since 1970. The
declaration and payment of dividends is at the discretion of the
Board of Directors. The Board of Directors considers, among
other factors, the Company's earnings, financial condition and
capital spending requirements in determining the appropriate
dividend.
The Company and its subsidiaries are restricted in the
payment of cash, dividends, loans or other similar transactions
by the terms of Indentures executed by the Company in connection
with the issuance of (i) 9 1/4% First Mortgage Bonds Due 2008 and
(ii) 13% Senior Subordinated Notes Due 2009. See "Management's
Discussion and Analysis - Liquidity and Capital Resources" and
the Company's Annual Report on Form 10-K for the year ended
December 31, 1994.
<PAGE>
SELLING SECURITY HOLDERS
The following table lists the names of the persons whose
Warrants and Shares are covered by this Prospectus (the "Selling
Security Holders"), and for each, the number of Warrants and/or
Shares beneficially owned at the commencement of the offering,
the number of Warrants and/or Shares being offered for sale and
the number of Warrants and/or Shares to be beneficially owned
after the offering. The columns "Number of Shares Owned at
Commencement of Offering" and "Number of Shares Being Offered"
include all of the Shares issuable upon exercise of the Warrants
held by each Selling Security Holder. An affiliate of the
Selling Security Holder, Donaldson, Lufkin & Jenrette Securities
Corporation (the "Underwriter"), has acted as an underwriter to
the Company from time to time in connection with its public
offerings for over 10 years. An affiliate of the Underwriter
provided a standby bridge loan commitment to the Company relating
to the Company's investment in SHCL, for which it received
customary fees.
<TABLE>
<CAPTION>
Warrants Common Stock(1)
Number Number Number of
of Number of Shares
Warrants of Warrants Owned at Number of
Owned at Warrants Owned Commence- Shares Number of
Commence- Being After ment of Being Shares Owned
Selling ment of Offered Offering Offering Offered After Offering
Security Holder Offering
<S> <C> <C> <C> <C> <C> <C>
DLJ Capital 93,686 93,686 0 93,686 93,686 0
Corporation
Equitable Life 41,387 41,387 0 41,387 41,387 0
Assurance
Society of the
United States
Equitable 8,563 8,453 0 8,563 8,563 0
Variable Life
Insurance
Company
DLJ First ESC LLC 6,364 6,364 0 6,364 6,364 0
__________________________
<FN>
(1)Beneficial ownership for each of the Selling Security Holders
does not exceed 1% of the outstanding Common Stock at the
commencement of the offering or after the offering.
</FN>
</TABLE>
<PAGE>
PLAN OF DISTRIBUTION
The Warrants and Shares may be sold from time to time to
purchasers directly by any of the Selling Security Holders or,
alternatively, any of the Selling Security Holders may from time
to time offer the Warrants and Shares through dealers or agents,
who may receive compensation in the form of underwriting
discounts, concessions or commissions from the Selling Security
Holders and/or the purchasers of the Warrant and Shares for whom
they may act as agent. Any discounts, commissions or concessions
received by any such dealers or agents and any profits on the
sale of Warrants and Shares by them may be deemed to be
underwriting discounts and commissions under the Securities Act.
At any time a particular offer of Warrants and Shares is made, if
required by applicable law or regulations, a Prospectus
Supplement will have to be distributed which will set forth the
aggregate amount of Warrants and Shares being offered and the
terms of the offering, including the name or names of any dealers
or agents, any discounts, commissions and other items
constituting compensation from the Selling Security Holders and
any discounts, commissions or concessions allowed or paid to
dealers. Guidelines adopted by the National Association of
Securities Dealers, Inc. ("NASD") set forth the maximum
commission that any NASD member firm can receive in connection
with a distribution of any of the Warrants and Shares without
further clearance from the NASD. If required by applicable law
or regulations, a Prospectus Supplement and/or a post-effective
amendment to the Registration Statement of which this Prospectus
is a part will have to be filed with the Commission to reflect
the disclosure of additional information with respect to the
distribution of the Warrants and Shares, including, if
applicable, the factors used to determine the price of the
Warrants and Shares then being offered.
Subject to the preceding paragraph, the Warrants and Shares
may be sold from time to time in one or more transactions at a
fixed offering price, which may be changed, at varying prices
determined at the time of sale, or at negotiated prices. Such
prices will be determined by the Selling Security Holders or by
agreement between the Selling Security Holders and/or dealers.
The Shares are listed on the NYSE and may also be sold in
transactions on the NYSE. The Warrants are not listed on an
exchange and there is no public market for the Warrants. In
addition, the Warrants and Shares may be sold, to the extent
permitted, from time to time in transactions effected in
accordance with the provision of Rule 144 under the Securities
Act.
Upon applicable rules and regulations under the Exchange
Act, any person engaged in a distribution of the Warrants and
Shares may not bid for or purchase the Warrants and Shares until
after such person has completed his or her participation in such
distribution, including the period of nine business days prior to
the commencement of such distribution. In addition to and
without limiting the foregoing, the Selling Security Holders and
any other person participating in such distribution will be
subject to other applicable provisions of the Exchange Act and
the rules and regulations thereunder, including without
limitation rules 10b-2, 10b-6, and 10b-7, which provisions may
affect the timing of purchases and sales of any of the Warrants
and Shares by the Selling Security Holders and any such other
person. All of the foregoing may affect the marketability of the
Warrants and Shares and the ability of any person or entity to
engage in market making activities with respect to the Warrants
and Shares.
Pursuant to prior agreements entered into with the Selling
Security Holders, the Company will pay substantially all of the
expenses incident to the registration, offering and sale of the
Warrants and Shares to the public, other than commissions and
discounts of dealers or agents.
<PAGE>
DESCRIPTION OF WARRANTS
The Warrants are issued in fully registered form under a
Warrant Agreement dated as of May 6, 1994 (the "Warrant
Agreement"), between the Company and DLJ Bridge Finance, Inc.
("DLJ"), an affiliate of the Selling Security Holders. A copy of
the form of the Warrant Agreement is filed as an exhibit to the
Registration Statement of which this Prospectus is a part. The
following summary of certain provisions of the Warrant Agreement
does not purport to be complete and is subject, and is qualified
in its entirety by reference, to all the provisions of the
Warrants and the Warrant Agreement, including the definitions
therein of certain terms. All capitalized terms not otherwise
defined herein have the meanings assigned in the Warrant
Agreement.
EXERCISE OF WARRANTS
Each Warrant entitles the holder thereof to purchase one
share of Common Stock of the Company at a price of $15.50. The
exercise price and the number of shares of Common Stock issuable
upon the exercise of each Warrant are subject to adjustment. The
Warrants may be exercised at any time until 5:00 p.m. New York
City Time on May 6, 1999. The exercise price of the Warrants
will be payable at the holder's option either (i) in cash,
(ii) by certified check or official bank check payable to the
order of the Company, or (iii) by surrender of debt or preferred
equity securities of the Company having a principal amount or
liquidation preference, as the case may be, equal to the
aggregate exercise price to be paid. In the alternative, each
holder of Warrants may exercise its rights to receive Shares on a
net basis, such that, without the exchange of any funds, the
holder of Warrants receives that number of Shares otherwise
issuable upon exercise of its Warrants less that number of Shares
having an aggregate Quoted Price at the time of exercise equal to
the aggregate exercise price that would otherwise have been paid
by the holder of the Shares. The Warrants shall be exercisable,
at the option of the holders thereof, either in full or from time
to time in part (in whole shares).
PAYMENT OF TAXES
The Company shall pay all documentary stamp taxes
attributable to the initial issuance of Shares upon the exercise
of the Warrants; provided, however, the Company shall not be
required to pay any tax or taxes which may be payable in respect
of any transfer involved in the issuance of any certificates for
Warrants or any certificates for Shares in a name other than that
of the registered holder of a Warrant surrendered upon the
exercise of a Warrant.
STOCK EXCHANGE LISTING
The Company shall take all action which may be necessary so
that the Shares, immediately upon their issuance upon the
exercise of the Warrants, will be listed on the NYSE or other
principal securities exchanges and markets, if any, on which
other shares of Common Stock of the Company are listed.
ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES
The Exercise Price and the number of Shares issuable upon
the exercise of each Warrant are subject to adjustment from time
to time upon the occurrence of certain events.
ADJUSTMENTS FOR CHANGE IN CAPITAL STOCK
The exercise and the number of Shares of Common Stock
issuable upon exercise of the Warrants are subject to adjustment
in certain circumstances, including in the event of (a) the
payment of a stock dividend or distribution, the occurrence of a
stock split or reverse-split, the reclassification of Common
Stock or the reorganization, merger, or consolidation of the
Company; (b) the distribution to stockholders generally of
<PAGE>
evidence of indebtedness or assets of the Company or rights or
options to, or securities convertible into or exchangeable or
exercisable for, the same or (c) the issuance of Common Stock at
a price less the then current market value of the Common Stock or
rights or options to, or securities convertible into or
exchangeable or exercisable for, the same. No adjustment in the
exercise price need be made unless the adjustment would require
an increase or decrease of at least 1% in the exercise price of
the Warrant. Any adjustments that are not made shall be carried
forward and taken into account in any subsequent adjustment.
No adjustment need be made for a transaction if Warrant
holders agree to participate in the transaction on a basis and
with notice that the Board of Directors determined to be fair and
appropriate in light of the basis and notice on which the holders
of Common Stock participate in the transaction. No adjustment
need be made for rights to purchase Common Stock pursuant to the
Company's plan for reinvestment of dividends or interest.
Additionally, no adjustment need be made for a change in the par
value or no par value of the Common Stock. To the extent the
Warrants become convertible to cash, no adjustment need be made
thereafter as to the cash. Interest will not accrue on the cash.
CURRENT MARKET PRICE
The current market price per share of Common Stock on any
date is the average of the Quoted Prices of the Common Stock for
30 consecutive trading days commencing 45 trading days before the
date in question. The "Quoted Price" of the Common Stock is the
last reported sales price of the Common Stock as reported by the
NYSE, or if the Common Stock is listed on another securities
exchange, the last reported sales price of the Common Stock on
such exchange which shall be for consolidated trading if
applicable to such exchange, or as reported by NASDAQ, National
Market System, or if neither so reported or listed, the last
reported bid price of the Common Stock. In the absence of one or
more such quotations, the Board of Directors of the Company shall
determine the current market price on the basis of such
quotations as it in reasonable good faith considers appropriate.
REORGANIZATION OF THE COMPANY
If the Company consolidates or merges with or into, or
transfers or leases all or substantially all its assets to, any
person, upon consummation of such transaction the Warrants shall
automatically become exercisable for the kind and amount of
securities, cash or other assets which the holder of a Warrant
would have owned immediately after the consolidation, merger,
transfer or lease if the holder had exercised the Warrant
immediately before the effective date of the transaction.
Concurrently with the consummation of such transaction, the
corporation formed by or surviving any such consolidation or
merger if other than the Company, or the person to which such
sale or conveyance shall have been made, shall enter into a
supplemental Warrant Agreement so providing and further providing
for adjustments which shall be as nearly equivalent as may be
practical to the adjustments provided for above. The successor
shall mail to Warrant holders a notice describing the
supplemental Warrant Agreement. If the issuer of securities
deliverable upon exercise of Warrants under the supplemental
Warrant Agreement is an affiliate of the formed, surviving,
transferee or lessee corporation, that issuer shall join in the
supplemental Warrant Agreement.
WHEN ISSUANCE OR PAYMENT MAY BE DEFERRED
In any case in which the Warrant Agreement shall require
that an adjustment in the Exercise Price be made effective as of
a record date for a specified event, the Company may elect to
defer until the occurrence of such event (i) issuing to the
holder of any Warrant exercised after such record date the Shares
and other capital stock of the Company, if any, issuable upon
such exercise over and above the Warrant Shares and other capital
stock of the Company, if any, issuable upon such exercise on the
basis of the Exercise Price and (ii) paying to
<PAGE>
such holder any amount in cash in lieu of a fractional share;
PROVIDED, HOWEVER, that the Company shall deliver to such holder
a due bill or other appropriate instrument evidencing such
holder's right to receive such additional Shares, other capital
stock and cash upon the occurrence of the event requiring such
adjustment.
DESCRIPTION OF CAPITAL STOCK
The aggregate number of shares of capital stock which the
Company has authority to issue is 51,000,000, of which 50,000,000
shares are Common Stock, $1.00 par value, and 1,000,000 shares
are Preferred Stock, $1.00 par value.
COMMON STOCK
All holders of Common Stock have the right to cast one vote
for each share held of record on any matter coming before the
stockholders for a vote. Stockholders have no preemptive or
subscription rights. There are no conversion or redemption
rights or sinking fund provisions with respect to the Common
Stock; however, each share of outstanding Common Stock is
entitled to one Preferred Stock Purchase Right. A more detailed
description of the Preferred Stock Purchase Rights is set forth
under the caption "Preferred Stock" below.
Subject to rights of the holders of outstanding Preferred
Stock, the holders of Common Stock are entitled to dividends in
such amounts as may be declared by the Board of Directors from
time to time from funds legally available therefor, and, in the
event of liquidation, to share ratably in any assets of the
Company remaining after payment in full of all creditors and
provisions for any liquidation preferences on any outstanding
Preferred Stock.
The Company's Articles of Incorporation require a vote of
two-thirds (66-2/3%) of the voting power of the Company to
approve a merger, consolidation or sale or lease of substantially
all the assets of the Company. This requirement could make an
attempted takeover of the Company more difficult.
PREFERRED STOCK
The Company is authorized to issue 1,000,000 shares of
Preferred Stock. The Company's Board of Directors is empowered
to issue one or more series of Preferred Stock with such rights,
preferences, restrictions and privileges as may be fixed by the
Board of Directors, without further action by the Company
stockholders. None of the Preferred Stock is issued and
outstanding. However, the Company has authorized rights
("Rights") to purchase Preferred Stock upon the occurrence of
certain events (as described below).
RIGHTS
Each Right entitles the registered holder to purchase from
the Company one one-hundredth (1/100) of a share of Preferred
Stock of the Company, designated as Series A Junior Preferred
Stock (the "Series A Preferred Stock") at a price of $120.00 per
one one-hundredth (1/100) of a share (the "Exercise Price"). The
description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and
American Stock Transfer and Trust Company, as Rights Agent (the
"Rights Agent").
The Rights, unless earlier redeemed by the Board of
Directors, become exercisable upon the close of business on the
day (the "Distribution Date") which is the earlier of (i) the
tenth day following a public announcement that a person or group
of affiliated or associated persons, with certain exceptions, has
acquired beneficial ownership of 15% or more of the outstanding
voting stock of the Company (an "Acquiring Person") and (ii) the
tenth business day (or such later date as may be determined by
the Board of Directors prior to such time as any person or group
of affiliated or associated persons becomes an Acquiring Person)
after the date of the
<PAGE>
commencement or announcement of a person's or group's intention
to commence a tender or exchange offer the consummation of which
would result in the ownership of 30% or more of the Company's
outstanding voting stock (even if no shares are actually
purchased pursuant to such offer); prior thereto, the Rights
would not be exercisable, would not be represented by a separate
certificate, and would not be transferable apart from the
Company's Common Stock.
The Rights are not exercisable until the Distribution Date.
The Rights will expire at the close of business on October 5,
2005, unless earlier redeemed by the Company as described below.
The Series A Preferred Stock is nonredeemable and, unless
otherwise provided in connection with the creation of a
subsequent series of preferred stock, subordinate to any other
series of the Company's preferred stock. The Series A Preferred
Stock may not be issued except upon exercise of Rights. Each
share of Series A Preferred Stock will be entitled to receive
when, as and if declared, a quarterly dividend in an amount equal
to the greater of $120.00 per share or 100 times the cash
dividends declared on the Company's Common Stock. In addition,
Series A Preferred Stock is entitled to 100 times any non-cash
dividends (other than dividends payable in equity securities)
declared on the Common Stock, in like kind. In the event of the
liquidation of the Company, the holders of Series A Preferred
Stock will be entitled to receive, for each share of Series A
Preferred Stock, a payment in an amount equal to the greater of
$12,000.00 or 100 times the payment made per share of Common
Stock. Each share of Series A Preferred Stock will have 100
votes, voting together with the Common Stock. In the event of
any merger, consolidation or other transaction in which Common
Stock is exchanged, each share of Series A Preferred Stock will
be entitled to receive 100 times the amount received per share of
Common Stock. The rights of Series A Preferred Stock as to
dividends, liquidation and voting are protected by anti-dilution
provisions.
The number of shares of Series A Preferred Stock issuable
upon exercise of the Rights is subject to certain adjustments
from time to time in the event of a stock dividend on, or a
subdivision or combination of, the Common Stock. The Exercise
Price for the Rights is subject to adjustment in the event of
extraordinary distributions of cash or other property to holders
of Common Stock.
Unless the Rights are earlier redeemed or the transaction is
approved by the Board of Directors and the Continuing Directors,
if the Company at any time after the Distribution Date were to be
acquired in a merger or other business combination (in which any
shares of Common Stock are changed into or exchanged for other
securities or assets) or more than 50% of the assets or earning
power of the Company and its subsidiaries (taken as a whole) were
to be sold or transferred in one or a series of related
transactions, the Rights Agreement provides that proper provision
will be made so that each holder of record of a Right will from
and after such date have the right to receive, upon payment of
the Exercise Price, that number of shares of common stock of the
acquiring company having a market value at the time of such
transaction equal to two times the Exercise Price. In addition,
unless the Rights are earlier redeemed, in the event that a
person or group becomes the beneficial owner of 15% or more of
the Company's voting stock (other than pursuant to a tender or
exchange offer (a "Qualifying Tender Offer") for all outstanding
shares of Common Stock that is approved by the Board of
Directors, after taking into account the long-term value of the
Company and all other factors they consider relevant in the
circumstances), the Rights Agreement provides that proper
provisions will be made so that each holder of record of a Right,
other than the Acquiring Person (whose Rights will thereupon
become null and void), will thereafter have the right to receive,
upon payment of the Exercise Price, that number of shares of the
Series A Preferred Stock having a market value at the time of the
transaction equal to two times the Exercise Price (such market
value to be determined with reference to the market value of the
Company's Common Stock as provided in the Rights Agreement).
Fractions of shares of Series A Preferred Stock (other than
fractions which are integral multiples of one one-hundredth of a
share) may, at the election of the Company, be evidenced by
depositary receipts. The Company may also issue cash in lieu of
fractional shares which are not integral multiples of one one-
hundredth of a share.
At any time on or prior to the close of business on the
earlier of (i) the tenth day after the time that a person has
become an Acquiring Person (or such later date as a majority of
the Board of Directors and a majority of the Continuing Directors
(as defined in the Rights Agreement) may determine) or
(ii) October 5, 2005, the Company may redeem the Rights in whole,
but not in part, at a price of $.01 per Right (the "Redemption
Price"). The Rights may be redeemed after the time that any
Person has become an Acquiring Person only if approved by a
majority of the Continuing Directors. Immediately upon the
effective time of the action of the Board of Directors of the
Company authorizing redemption of the Rights, the right to
exercise the Rights will terminate and the only right of the
holders of Rights will be to receive the Redemption Price.
For as long as the Rights are then redeemable, the Company
may, except with respect to the redemption price or date of
expiration of the Rights, amend the Rights in any manner,
including an amendment to extend the time period in which the
Rights may be redeemed. At any time when the Rights are not then
redeemable, the Company may amend the Rights in any manner that
does not materially adversely affect the interests of holders of
the Rights as such. Amendments to the Rights Agreement from and
after the time that any Person becomes an Acquiring Person
requires the approval of a majority of the Continuing Directors
(as provided in the Rights Agreement).
<PAGE>
Until a Right is exercised, the holder, as such, will have
no rights as a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends.
LEGAL MATTERS
Certain legal matters with regard to the validity of the
Warrants and Shares will be passed upon for the Company by Kummer
Kaempfer Bonner & Renshaw, Las Vegas, Nevada. H. Gregory Nasky,
of counsel to the law firm of Kummer Kaempfer Bonner & Renshaw,
is a Director and the Secretary of the Company.
EXPERTS
The consolidated financial statements and schedules of the
Company and its subsidiaries as of December 31, 1994 and 1993,
and for each of the years in the three-year period ended
December 31, 1994, included in the Company's Annual Report on
Form 10-K as filed with the Securities and Exchange Commission,
which are incorporated by reference herein and elsewhere in the
Registration Statement, have been included and incorporated by
reference herein and elsewhere in the Registration Statement in
reliance upon the reports of KPMG Peat Marwick LLP, independent
certified public accountants, included and incorporated by
reference herein and elsewhere in the Registration Statement, and
upon the authority of said firm as experts in accounting and
auditing.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses set forth below will be borne
entirely by the Company:
ITEM AMOUNT
Securities and Exchange Commission Registration $ 1,250
Fee
Blue Sky Fees 500
NASD Fees -0-
New York Stock Exchange Listing Fee -0-
Transfer Agents' Fees -0-
Legal Fees and Expenses 15,000
Accounting Fees and Expenses 5,000
Miscellaneous Expenses -0-
Total. $21,750
ITEM 16. EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
4.03 Restated Bylaws of the Company dated October 24, 1995
is incorporated herein by reference from the Company's
Quarterly Report on Form 10-Q for the Nine Months Ended
September 30, 1995, Part II, Item 6(a), Exhibit 3.01
(file no. 1-7123).
24.02 Consent of KPMG Peat Marwick.
<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 AMENDMENT NO. 1 TO THE REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED IN THE CITY OF LAS VEGAS, STATE OF
NEVADA ON DECEMBER 4, 1995.
SHOWBOAT, INC.
By: /s/ J.K. Houssels, III
J.K. HOUSSELS, III
President and Chief Executive Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933,
THIS AMENDMENT NO. 1 TO THE REGISTRATION STATEMENT HAS BEEN
SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATES INDICATED.
SIGNATURES TITLE DATE
Chairman of the Board
J.K. Houssels
/s/ J.K. Houssels, III Director, President and December 4, 1995
J.K. Houssels, III Chief Executive Officer
/s/ Leann Schneider Vice President-Finance, December 4, 1995
Leann Schneider Treasurer and Chief Financial
Officer (Principal Accounting
Officer)
* Director
William C. Richardson
Director
John D. Gaughan
* Director
Jeanne Stewart
<PAGE>
* Director
Frank A. Modica
Director, Executive Vice
H. Gregory Nasky President and Secretary
* Director
George A. Zettler
* Director
Carolyn M. Sparks
*By: /s/ John N. Brewer (Attorney-in-Fact) December 4, 1995
John N. Brewer
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER PAGE
4.03 Restated Bylaws of the Company dated October 24,
1995 is incorporated herein by reference from the
Company's Quarterly Report on Form 10-Q for the
Nine Months Ended September 30, 1995, Part II,
Item 6(a), Exhibit 3.01 (file no. 1-7123).
24.02 Consent of KPMG Peat Marwick. 25
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Showboat, Inc.
We consent to incorporation by reference in the registration
statement on Form S-3 of Showboat, Inc. of our report dated March
10, 1995, relating to the consolidated balance sheets of Showboat,
Inc. as of December 31, 1994 and 1993, and the related consolidated
statements of income, shareholders' equity, and cash flows for each
of the years in the three-year period ended December 31, 1994, and
the related schedule, which report appears in the December 31, 1994
annual report on Form 10-K of Showboat, Inc. and to the reference
to our firm under the heading "Experts" in the prospectus.
Our report refers to a change in the method of accounting for income
taxes.
/s/ KPMG Peat Marwick LLP
Las Vegas, Nevada
December 1, 1995
