15
Filed Pursuant to Rule 424(b)(4)
PROSPECTUS Registration File No.: 333-45610
3,448,000 Shares
ALPHA HOSPITALITY CORPORATION
Common Stock, par value $0.01 per share
This prospectus relates to 3,448,000 shares of the common
stock, par value $0.01 per share, of Alpha Hospitality
Corporation ("Alpha" or "we"). The shares of common stock being
offered by the selling stockholder may be acquired by the selling
stockholder upon conversion of up to $1,250,000 aggregate
principal amount of its 4% Convertible Notes Due July 31, 2003
(the "Notes") held by it or upon the exercise of 3-year warrants
(the "Warrants") issued by Alpha in conjunction with the sale of
the Notes and held by the selling stockholder. Alpha will not
receive any proceeds from the conversion of shares of the Notes
into shares of common stock or from the sale of shares of common
stock by the selling stockholder. Although Alpha will receive
proceeds from the exercise of the Warrants, if they are exercised
without the use of the cashless exercise option, it would not
receive any proceeds from the subsequent sale of the shares of
common stock issued upon the exercise of the Warrants.
----------------------
These securities involve a high degree of risk. See "Risk
Factors."
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE
SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The shares of common stock being offered by the selling
stockholder have not been registered for sale under the
securities laws of any state or jurisdiction as of the date of
this prospectus.
Alpha's common stock is listed for trading on The NASDAQ
SmallCap Market under the symbol "ALHY" and on the Boston Stock
Exchange under the symbol "ALH." On September 19, 2000, the
closing bid price of Alpha's common stock, as reported by The
NASDAQ SmallCap Market, was $1.50 per share.
Alpha's executive offices are located at 12 East 49th Street, New
York, New York 10017.
Its telephone number is 212-750-3500.
The date of this prospectus is September 20, 2000.
<PAGE>
THIS PROSPECTUS CONTAINS FORWARD LOOKING STATEMENTS
Some of the statements in this prospectus constitute forward-
looking statements. These statements involve known and unknown
risks, uncertainties and other factors that may cause our or our
industry's results, levels of activity, performance or
achievements to be significantly different from any future
results, levels of activity, performance or achievements
expressed or implied by the forward-looking statements. These
factors include, among others, those listed under "Risk Factors"
and elsewhere in this prospectus. In some cases, you can
identify forward-looking statements by the use of the words
"may," "will," "should," "expects," "plans," "intends,"
"anticipates," "believes," "estimates," "predicts," "potential,"
or "continue" or the negative of those terms or other comparable
terminology.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, events, levels of activity, performance or
achievements. We do not assume responsibility for the accuracy
and completeness of the forward-looking statements. We do not
intend to update any of the forward-looking statements after the
date of this prospectus to conform them to actual results.
TABLE OF CONTENTS
RISK FACTORS 3
Alpha may not be successful in acquiring or developing the
business opportunities it is considering 3
Unless Alpha successfully develops business operations, it may
not be able to meet its obligations 4
Alpha has a history of losses and may never be profitable 4
If Alpha develops new ventures, it may not have the management
expertise to be successful in them 5
Alpha has significant outstanding indebtedness and other
obligations, which may impair its ability to raise additional
capital in the future 5
OTHER CONSIDERATIONS 6
USE OF PROCEEDS 9
SELLING STOCKHOLDER 9
PLAN OF DISTRIBUTION 11
LEGAL MATTERS 13
EXPERTS 14
ADDITIONAL INFORMATION ABOUT ALPHA 14
DOCUMENTS INCORPORATED BY REFERENCE 15
No dealer, salesperson or other person has been authorized
to give any information or to make any representations not
contained in this prospectus or incorporated by reference to this
<PAGE>
prospectus, and, if given or made, such information or
representations must not be relied upon as having been authorized
by Alpha. This prospectus does not constitute an offer to sell,
or a solicitation of an offer to buy, the securities offered by
this prospectus in any jurisdiction to any person to whom it is
unlawful to make such offer or solicitation in such jurisdiction.
The delivery of this prospectus at any time does not imply that
the information contained in this prospectus is correct as of any
time subsequent to its date.
RISK FACTORS
Before you decide to invest in Alpha's common stock
being offered by this prospectus, you should be aware that there
are various risks, including those described below. You should
carefully consider these risks as well as the more detailed
information contained in this prospectus and in the documents
incorporated in this prospectus by reference, before making your
decision.
Alpha may not be successful in acquiring or developing the
business opportunities it is considering.
Alpha must overcome significant obstacles before it can
participate in the prospective gaming opportunities it has been
considering in New York, Mississippi and Florida. For example:
Although a settlement has been reached regarding the
prospective rights of Alpha's subsidiary, Alpha Monticello, to
share in management fees and service fees from a proposed casino
project contemplated to be located in Monticello, New York, there
can be no assurance that any casino will be developed or those
such rights will otherwise result in any revenues to Alpha or its
affiliates. This is due to a number of considerations, including
those referred to below. New York Governor George E. Pataki has
proposed legislation that, if enacted, could affect the approval
process for the construction and operation of casinos on Indian
lands within New York State. Although that proposed legislation
has not made it to the floor of the State legislature, there can
be no assurance that it will not do so. It is possible that, if
the proposed legislation is presented to the legislature, the
legislature, in considering the proposal, could amend the
proposed legislation or otherwise adopt legislation that could
adversely affect the proposed development of the proposed
Monticello project. Additionally, news reports have announced a
purported agreement between the St. Regis Mohawk Tribe and Park
Place Entertainment concerning management of casino projects in
New York State. It is possible that the purported agreement
could adversely affect the proposed development of the Monticello
project.
Earlier this year, legislation was proposed in Florida that,
if enacted, would have dramatically altered the current state law
and would have imposed significant new restrictions or
limitations on the "cruise-to-nowhere" industry. Although that
bill has been withdrawn from consideration by its sponsor and
will not be brought to a vote, there can be no assurance that
this or similar legislation will not be resubmitted in the future
and, if enacted, would not be detrimental to the industry.
<PAGE>
Unless Alpha successfully develops business operations, it will
not be able to meet its obligations.
Alpha currently has no active operating business to generate
income. Alpha's management believes it has sufficient cash
resources to meet its general and administrative obligations for
the next twelve months, provided that its "cruise-to-nowhere"
operations in Florida do not result in a drain on Alpha's cash
resources. There can be no assurance that those operations will
not result in a drain on Alpha's cash resources. Alpha's long-
term ability to meet its general and administrative obligations
will depend on its ability to do one or more of the following
things:
Achieve profits from the prospective gaming operations in
New York, Mississippi or Florida;
Achieve profits from operations of any other future
business opportunities;
Combine with an entity having sufficient cash flow to meet
Alpha's obligations; or
Obtain additional funds through financing activities.
As of the date of this prospectus, Alpha has not entered
into any arrangement to participate in any business ventures or
purchase any assets, property or business, other than as
previously disclosed or discussed elsewhere in this prospectus.
Alpha cannot give any assurance that it will be able to generate
enough funds through any of these activities to meet its general
and administrative obligations.
Alpha has a history of losses and may never be profitable.
Since its inception, Alpha has suffered significant losses
from operations. Excluding non-cash compensation adjustments,
Alpha had losses from operations, including interest, of
approximately $2,512,000, $7,024,000, and $8,149,000 in the
fiscal years ended December 31, 1999, 1998 and 1997,
respectively, and approximately $570,000 for the six months
ended June 30, 2000. The non-cash compensation adjustment,
which amounted to approximately $2,320,000 of income for the six
months ended June 30, 2000 and approximately $3,251,000 of
expense for the fiscal year ended December 31, 1999, relates to
deferred compensation payable to Alpha's Chairman and CEO, which
compensation that individual has been granted the right to
convert into shares of Alpha's common stock at $2.00 per share,
the price of Alpha's common stock at the time that right was
granted in 1999. As of June 30, 2000, Alpha had an accumulated
deficit of approximately $80,566,000. Although Alpha received
approximately $3,900,000 in net proceeds from the sale of its
Series D Preferred Stock in February 2000 and an additional net
proceeds of approximately $1,200,000 from the sale of the Notes
and the Warrants, these proceeds were designated for specific
projects, including the "cruise to nowhere" in Florida and other
gaming-related businesses or operations. To provide investors a
positive return in the long-term, Alpha must develop or acquire
profitable operations. There can be no assurance that Alpha
will be able to develop or acquire profitable operations.
<PAGE>
If Alpha develops new ventures, it may not have the management
expertise to be successful in them.
Alpha's affiliates and members of management have
significant experience operating casinos, hotels and related
hospitality ventures. Management has been concentrating its
investigation of potential business acquisitions in these areas,
including prospective gaming opportunities in New York,
Mississippi and Florida. If Alpha enters into another line of
business, Alpha's management may find that it lacks necessary
expertise in that business. Therefore, we cannot assure you
that, if Alpha develops or acquires new lines of business, it
will be profitable in those businesses.
Alpha has significant outstanding indebtedness and other
obligations, which may impair its ability to raise additional
capital in the future.
Alpha's outstanding long-term indebtedness, excluding debt
of Alpha's subsidiaries, consists of a note payable to an
affiliate, Bryanston Group, Inc. The balance of this note on
June 30, 2000 was approximately $1,454,000, inclusive of $46,000
of accrued interest. No default or acceleration has occurred on
this loan. Alpha cannot give any assurance that a default will
not be declared in the future. Declaration of a default could
have an adverse affect on Alpha's financial condition, business
and/or operations.
Alpha's chairman and chief executive, Stanley S. Tollman,
has agreed to defer receiving his salary until January 1, 2001.
Although the salary accumulates without interest, the total
amount owed to Mr. Tollman at September 12, 2000 was
approximately $1.7 million. Mr. Tollman has been granted the
right, subject to specific conditions, to convert up to
$2,000,000 of this accumulated salary into shares of Alpha's
common stock, at a price of $2.00 per share, no earlier than
January 14, 2001, except in the case of his death or disability.
There can be no assurance that Mr. Tollman will continue to
defer receiving his salary after January 1, 2001. In the event
that, after January 1, 2001, Mr. Tollman should insist upon
payment of his deferred salary, the large payment of cash that
would be required could have an adverse affect on Alpha's
financial condition, business and/or operations.
If either of these events were to occur, a large cash
payment would be required and Alpha's resources would be
reduced. With reduced resources, Alpha would likely find it
more difficult to fund its operations or develop its proposed
operations. Alpha would likely also find it more difficult to
raise additional capital.
<PAGE>
OTHER CONSIDERATIONS
Future sales of shares could potentially dilute your interest in
Alpha's common stock.
As of September 11, 2000, Alpha had 20,207,422 shares
of common stock outstanding. Up to an additional 848,000 shares
will be issued if holders of Alpha's publicly traded warrants
choose to exercise them. Up to 3,323,000 shares of common stock
may be issued upon conversion of the Series D Preferred Stock
and/or the Notes and up to an additional 200,000 shares of
common stock may be issued upon the exercise of the Warrants.
One result of having a conversion price based upon the market
price of Alpha's common stock is that if the market price of a
share of Alpha's common stock is less than $2.40, the number of
shares of common stock issuable upon conversion of the Notes
increases as the market price of the common stock decreases. If
the market price of Alpha's common stock exceeds $2.40, the
conversion price of the Notes and the exercise price of the
Warrants could be substantially below the market price of the
common stock on the date of conversion or exercise, as the case
may be.
Similarly, holders of other securities issued by Alpha and
exercisable for, or convertible into, shares of Alpha's common
stock may from time to time exercise or convert their securities
into common stock. Stanley S. Tollman, Alpha's chairman and
chief executive officer, has been granted the right, subject to
specific conditions, to convert up to $2,000,000 of deferred
salary into Alpha's common stock at $2.00 per share, no earlier
than January 14, 2001, except in the case of his death or
disability. The number of shares of common stock referred to in
this paragraph may be subject to increase to protect against
dilution. If holders of these other securities exercise or
convert them into shares of common stock or Mr. Tollman converts
his deferred salary into shares of common stock, the increased
number of shares available in the market would likely result in
a lower market price per-share for Alpha's common stock.
The market price of Alpha's common stock can be highly volatile.
The average daily trading volume of Alpha's common
stock has generally been light. The market price has been
highly volatile and may not be indicative of the market price in
a more liquid market. Therefore, the low volume may have had a
significant effect on the historical market price of the stock.
The market price of the stock could also be subject to
significant fluctuations in response to a number of factors, not
all of which may relate directly to Alpha's performance. Some
of these factors are: the depth and liquidity of the market for
the stock; public announcements by Alpha, its clients and
competitors; investors' perception of Alpha; rumors; and general
economic and other conditions.
Alpha cannot assure that there will be a public market in the
future for its securities.
Alpha cannot assure that its common stock will continue to
be quoted on the NASDAQ SmallCap Market or listed on the Boston
Stock Exchange. Even if these quotations or listings continue,
Alpha can provide no assurance that there will be a significant
public market. Among other requirements for continued listing
on the Nasdaq SmallCap Market, a company must have at least
$2,000,000 in net tangible assets, and the listed security must
have a minimum bid price of $1.00 per share. Our common stock
traded below $1.00 per share as recently as December 1998. The
Boston Stock Exchange's maintenance criteria require a company
to have total assets of at least $1,000,000 and total
stockholders' equity of at least $500,000. At June 30,
<PAGE>
2000, Alpha had total assets of approximately $10.7 million and
stockholders' equity of approximately $5.6 million. In the
event Alpha's common stock were delisted from the Nasdaq
SmallCap Market, trading, if any, would be conducted on the
Boston Stock Exchange and in the over-the-counter market on the
NASD's electronic bulletin board. Should this occur, an
investor could find it more difficult to dispose of or obtain
accurate quotations for the price of Alpha's securities.
If Alpha's common stock is de-listed from Nasdaq, it may be
considered a "penny stock".
SEC regulations impose additional requirements on broker-
dealers when selling penny stocks to persons other than
established customers and accredited investors. In general, an
accredited investor is a person with assets in excess of
$1,000,000 or annual income exceeding $200,000 individually or
$300,000 together with his or her spouse. The relevant SEC
regulations generally define "penny stocks" to include any non-
Nasdaq equity security with a market price (as defined in the
regulations) of less than $5 per share. Under the penny stock
regulations, a broker-dealer must make a special suitability
determination as to the purchaser and must have the purchaser's
prior written consent to the transaction. Prior to any
transaction in a penny stock covered by these rules, a broker-
dealer must deliver a disclosure schedule about the penny stock
market prepared by the SEC. Broker-dealers must also make
disclosure concerning commissions payable to both the broker-
dealer and any registered representative and provide current
quotations for the securities. Finally, broker-dealers are
required to send monthly statements disclosing recent price
information for the penny stock held in an account and
information on the limited market in penny stocks.
If Alpha's common stock were to be classified as a "penny
stock," these rules may discourage broker-dealers from effecting
transactions in Alpha's common stock or affect their ability to
sell Alpha's securities. As a result, purchasers and current
holders of Alpha's securities could find it more difficult to
sell their securities.
Compliance with government regulations may be costly or
disruptive to our proposed operations.
The prospective gaming operations that Alpha is pursuing are
regulated by federal, state and local governmental authorities.
We cannot assure you that we will be able to comply with current
or future governmental regulations everywhere we may conduct
business operations. Alpha may be required to incur substantial
costs or interrupt its activities to comply with regulations.
Present or future federal, state or local regulations may
restrict Alpha's present and possible future activities. If
Alpha is unable to comply with these or similar requirements, it
could be subject to sanctions. Any sanctions could have a
materially adverse effect upon Alpha's business.
<PAGE>
Denial or loss of a gaming license would adversely affect
Alpha's operations.
Generally, the applicable governing body in each state in
which a casino operator conducts its business must find suitable
or approve the casino operator and many of the key people
employed by or associated with the operator. If any person
associated with Alpha who is subject to approval or a
determination of suitability fails, now or in the future, to be
approved for a license or to remain qualified to hold a license,
Alpha would have to disassociate itself from that person or
Alpha could lose its license. The governing body almost always
has broad discretion in granting, renewing and revoking
licenses. Any denial, loss or suspension of any license would
have a materially adverse effect on Alpha's gaming operations
that require a license.
Alpha may compete in a highly competitive industry.
Alpha's current operations include: the development of
potential new gaming operations in New York, Mississippi and
Florida; and the acquisition or development of other business
operations. The industries in which these operations would be
conducted are highly competitive. Many of the potential
competitors in these industries have significantly greater
financial and other resources than Alpha and more experience in
the relevant industry. It is likely that this intense
competition may limit the profitability of Alpha's operations or
even render them unprofitable.
Alpha's previous gaming operations have been subject to seasonal
fluctuations.
The results of Alpha's former casino operations were
seasonal. The seasonal nature of casino operations increased
the risk that natural disasters or the loss of the casinos for
any other reason during the season of greatest activity would
have a material and adverse effect on Alpha's financial
condition and results of operations. In the event Alpha should
again have operations in the gaming industry, Alpha's business
could again be subject to similar fluctuations and risks.
Alpha's success is dependent upon the services of key officers.
Alpha's success is largely dependent upon the efforts of
Stanley S. Tollman, its president and chief executive officer.
Alpha does not maintain and does not intend to obtain a key
employee life insurance policy on the life of Mr. Tollman.
Although Mr. Tollman is only required to devote approximately
20% of his business time to the operations of Alpha, the loss of
his services could have a material and adverse effect on Alpha's
business and prospects.
Alpha's liability insurance may be insufficient.
Alpha maintains and intends to maintain general liability
insurance in amounts that management believes will be sufficient
to cover casualty risks associated with the operation of its
business. These risks include fire, property damage, personal
injury, liquor liability, etc. At present, Alpha is a defendant
in one proceeding based upon the theory of "liquor liability"
for the alleged service of alcohol to a customer. Alpha
believes that its exposure in this proceeding is adequately
covered by the levels of insurance currently maintained.
However, Alpha cannot assure that its existing insurance will be
adequate to cover any liabilities.
<PAGE>
USE OF PROCEEDS
The shares of common stock being offered hereunder are for
the account of the selling stockholder. Accordingly, Alpha will
not receive any of the proceeds from the sale of shares of common
stock by the selling stockholder. Alpha will also not receive
any proceeds upon the conversion of the Notes. Although Alpha
would receive proceeds from the exercise of the Warrants (unless
the selling shareholder elects to use the cashless exercise
option with respect to the exercise of the Warrants), it would
not receive any proceeds from the subsequent sale of shares of
common issued upon the exercise of the Warrants. See "Selling
Stockholder."
SELLING STOCKHOLDER
All of the shares of common stock being offered subject to
this prospectus are being offered by the selling stockholder
named in the table below. The number of shares in the table
represents the maximum aggregate number of shares that may be
acquired by the selling stockholder upon conversion of the
Notes, the exercise of the Warrants and/or the conversion of
Series D Preferred Stock previously issued to the selling
shareholder. As described below, the number of shares of common
stock that the selling stockholder may actually acquire upon
conversion may be less than the maximum. The selling
stockholder will determine the actual number of shares of common
stock that it will offer to sell, which may depend upon a number
of factors, including the market price of the common stock at
the time of sale.
Prior to the offering, the selling stockholder held
$1,250,000 principal amount of the Notes and Warrants
exercisable for up to 125,000 shares of Alpha's common stock, as
well as 2,750 shares of Alpha's Series D Preferred Stock issued
in February 2000. The maximum aggregate number of shares of
common stock issuable upon conversion of the Notes is 3,323,000,
all of which are being offered under this prospectus. That
maximum number, which includes any shares of common stock
issued, at Alpha's option, in payment of interest due on the
Notes, shall be reduced by the number of shares of Alpha's
common stock issued after July 31, 2000 upon the conversion of,
or in payment of dividends on, Alpha's Series D Preferred Stock
issued to the selling stockholder. As of the date of this
prospectus, none of the Notes has been converted into common
stock. The Notes may be converted at a price equal to the
lesser of (i) $2.40 and (ii) the average of the two lowest last
reported bid prices for the common stock on Nasdaq SmallCap
Market during the 30 trading days preceding, but excluding, the
date of conversion. The maximum number of 3,323,000 shares of
common stock issuable upon conversion of the Notes includes any
shares of common stock issued, at Alpha's option, in payment of
interest on the Notes.
The table below contains information furnished by the
selling stockholder concerning the beneficial ownership of
common stock of the selling stockholder as of the date of this
prospectus, which information relates exclusively to the selling
stockholder's holding of the Notes and the Warrants, as well as
outstanding shares of Alpha's Series D Preferred Stock. We have
assumed that the selling stockholder will sell the maximum
number of shares of common stock (a) into which the Notes and
the Series D Preferred Stock could potentially be converted
based upon the conversation terms and limitations applicable to
the Notes and the Series D Preferred Stock and (b) for which the
Warrants are exercisable, and the table does not reflect the
limitations on conversion of the Notes or exercise of the
Warrants described in the two
<PAGE>
paragraphs immediately following
the table or any similar limitations on conversion applicable to
the Series D Preferred Stock.
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
SHARES OF COMMON SHARES OF OWNED AFTER OFFERING
STOCK OWNED COMMON STOCK ----------
---------------------------------------------------
BEFORE OFFERING OFFERED NUMBER PERCENT
----------------- --------- --------------------
<S> <C> <C> <C> <C>
Societe
Generale 3,448,000 3,448,000 0 0%
</TABLE>
The number of shares of common stock issuable upon
conversion of the Notes is also limited by restrictions contained
in the Notes. The Notes and the Warrants provide that they are
convertible or exercisable only to the extent that, upon
conversion or exercise, the selling stockholder and its
affiliates would beneficially own not more than 4.9% of the
outstanding shares of common stock of Alpha. This 4.9%
limitation also applies to the selling stockholder's previously
acquired shares of Alpha's Series D Preferred Stock, which are
convertible into shares of Alpha's common stock, so that a
partial conversion of the Note and/or exercise of the Warrants,
together with conversion of shares of Alpha's Series D Preferred
Stock, cannot accidentally defeat the limit. Additionally, the
selling stockholder and its affiliates may only convert or
exercise any combination of securities, whether the Notes, the
Warrants or shares of the Series D Preferred Stock, if the total
number of shares to be received, when combined with all shares
received on account of all conversions and exercises during the
previous 60 consecutive days, will not exceed 9.9% of Alpha's
outstanding shares of common stock, determined as of the
beginning of that 60-day period; nor may the selling stockholder,
during any period of 61 consecutive days, sell shares of Alpha's
common, whether acquired upon conversion of the Notes, exercise
of the Warrants or otherwise, in excess of 9.9% of the Alpha's
issued and outstanding shares of common stock as of the first day
of that 61-day period. This 9.9% limitation is intended to
restrict the number of times within and 61-day period that the
selling stockholder can convert securities into, or exercise
securities for, Alpha's common stock, sell those shares of common
stock and then convert additional securities into, or exercise
securities for, common stock up to the 4.9% maximum. Alpha may
not waive either the 4.9% or the 9.9% limitation referred to
above.
One result of having a conversion price based upon the
market price of Alpha's common stock is that if the market price
of a share of Alpha's common stock is less than $2.40, the number
of shares of common stock issuable upon conversion of the Notes
increases as the market price of the common stock decreases. If
the market price of Alpha's common stock exceeds $2.40, the
conversion price of the Notes could be substantially below the
market price of the common stock on the date of conversion.
To the extent that any of the Notes is converted and the
resulting common stock is sold, the market price of the common
stock could decrease due to the increased number of shares then
being sold in the public market. This, in turn, may lead to
there being a proportionately greater number of shares of common
stock issuable upon subsequent conversion of any remaining Notes.
As a result, other holders of common stock could experience
substantial dilution, whether or not the shares of common stock
issued upon conversion are sold following conversion. If the
maximum number of 3,323,000 shares issuable upon conversion of
the Notes, including any shares of common stock issued, at
Alpha's option, in payment of interest on the Notes, were to be
<PAGE>
issued and any Notes remained outstanding, the interest rate on
these remaining Notes would be increased to 15% per annum and
would become payable in cash.
The Warrants are exercisable for up to 125,000 shares of
Alpha's common stock at an exercise price of $2.40 per share.
The Warrants expire on July 31, 2003.
The number of shares into which the Notes are convertible
and that are issuable upon the exercise of the Warrants, and the
maximum number of shares into which the Notes are convertible,
and the corresponding conversion and exercise prices are subject
to adjustment for stock splits, stock dividends,
reclassifications or other similar events or other dilutive
events.
Under an agreement between Alpha and the selling
stockholder, Alpha has agreed (i) to file the registration
statement of which this prospectus is a part for the purpose of
registering the potential resale of the shares issuable upon
conversion of the Notes and upon exercise of the Warrants, (ii)
to bear all expenses of the registration and sale of such shares
(other than any underwriting discounts and conversions) and (iii)
to indemnify the selling stockholder against some liabilities.
The selling stockholder does not have, and within the past
three years has not had, any other material relationship with
Alpha or any of its predecessors or affiliates other than as the
holder of shares of Alpha's Series D Preferred Stock purchased
from Alpha in February 2000.
PLAN OF DISTRIBUTION
The selling stockholder may offer and sell from time to time
under this prospectus the shares received by the selling
stockholder upon conversion of the Notes and/or the exercise of
the Warrants. The selling stockholder will act independently of
us in making decisions with respect to the timing, manner and
size of each sale. To the extent required, we may amend and
supplement this prospectus to describe a specific plan of
distribution.
The selling stockholder may sell the shares covered by this
prospectus by several possible means. These include, but are not
limited to, one or any combination of the types of transactions
described in the following list and the paragraphs that follow:
on the Nasdaq National Market or any other market where our
common stock may trade, at the then-prevailing prices and terms
or at prices related to the then-current market price or at
negotiated prices;
a block trade in which a broker-dealer will attempt to sell
shares as agent, but may position and resell a portion of the
block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resale by that
broker-dealer for its own account under this prospectus;
an over-the-counter distribution under the rules of the
Nasdaq SmallCap Market;
<PAGE>
ordinary brokerage transactions and transactions in which a
broker solicits purchasers; or
in privately negotiated transactions.
In addition to the list above, the selling stockholder may
also enter into hedging transactions with broker-dealers or other
financial institutions. In connection with these transactions,
broker-dealers or other financial institutions may engage in
short sales of our common stock in the course of hedging the
positions they assume with that selling stockholder. The selling
stockholder may also sell our common stock short and redeliver
the shares to close out short positions.
The selling stockholder may enter into option or other
transactions with broker-dealers or other financial institutions
that require that selling stockholder to deliver the shares
offered in this prospectus, and, in turn, the broker-dealer or
other financial institution may resell those shares under this
prospectus, as supplemented or amended to reflect the applicable
transaction.
The selling stockholder may pledge shares of common stock to
a broker-dealer or other financial institution, and, upon a
default, that broker-dealer or other financial institution may
sell the pledged shares of common stock under this prospectus, as
supplemented or amended to reflect the applicable transaction.
In addition, any shares of common stock that qualify for sale
under Rule 144 under the Securities Act may be sold under Rule
144 rather than under this prospectus.
The selling stockholder may sell shares of common stock
directly to market makers acting as principals and/or broker-
dealers acting as agents for themselves or their customers.
These broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the selling
stockholder or the purchasers of shares of common stock for whom
those broker-dealers may act as agent or to whom they sell as
principal or both. This compensation might be in excess of
customary commissions. Market makers and block purchasers that
purchase the shares of common stock will do so for their own
account and at their own risk. It is possible that the selling
stockholder will attempt to sell shares of common stock in block
transactions to market makers or other purchasers at a price per
share that may be below the then-current market price. We cannot
make assurances that all or any of the shares of common stock
will be issued to, or sold by, the selling stockholder. The
selling stockholder and any brokers, dealers or agents, upon
effecting the sale of any of the shares of common stock offered
by this prospectus, may be deemed "underwriters" as that term is
defined under the Securities Act or the Securities Exchange Act,
or the rules and regulations these acts.
The selling stockholder may sell all or any part of the shares of
common stock through an underwriter. Alpha is not aware of any
agreement the selling stockholder may have entered into with a
prospective underwriter, and there is no assurance that the
selling stockholder will enter into any agreement with a
prospective underwriter. If the selling stockholder enters into
an agreement or agreements with a prospective underwriter, the
relevant details will be set forth in a supplement or revisions
to this prospectus.
<PAGE>
To comply with the securities laws of some states, the
shares of common stock must be sold in some jurisdictions only
through registered or licensed brokers or dealers. Also, in some
states the shares of common stock may not be sold unless they
have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification
requirement is available and there has been compliance with that
requirement.
We have advised the selling stockholder that the anti-
manipulation rules of Regulation M under the Securities Exchange
Act may apply to sales of shares of common stock in the market
and to the activities of the selling stockholder and their
affiliates. In addition, we will make copies of this prospectus
available to the selling stockholder, and we informed them of the
need for delivery of copies of this prospectus to purchasers at
or prior to the time of any sale of the shares of common stock
offered under this prospectus.
At the time a particular offer of shares of common stock is
made, if required, a prospectus supplement will be distributed
that will set forth the number of shares of common stock being
offered and the terms of the offering, including the name of any
underwriter, dealer or agent, the purchase price paid by any
underwriter, any discount, commission and other item constituting
compensation, any discount, commission or concession allowed or
reallowed or paid to any dealer, and the proposed selling price
to the public.
Alpha anticipates that the selling stockholder will offer
for sale all of the shares being registered, to the extent that
those shares are issued to the selling stockholder upon its
conversion of the Notes and/or the exercise of the Warrants. See
"Selling Stockholder." Further, because it is possible that a
significant number of shares could be sold at the same time under
this prospectus, any sales, or the possibility of sales, may
depress the market price of the common stock.
Alpha will bear all costs and expenses of the registration
of the selling shareholder's shares under the Securities Act and
state securities laws. However, the selling shareholder will
bear all underwriting and brokerage commissions and underwriting
expenses, if any, attributable to the sale of its shares.
We have agreed to indemnify the selling stockholder
against certain liabilities, including liabilities under the
Securities Act of 1933.
LEGAL MATTERS
Certain legal matters in connection with the shares of
common stock being offered by this prospectus will be passed upon
for Alpha by Parker Duryee Rosoff & Haft, a Professional
Corporation, New York, New York. Herbert F. Kozlov, a director
of Alpha, is a member of this firm.
<PAGE>
EXPERTS
The consolidated financial statements included in Alpha's
annual report on Form 10-K for the year ended December 31, 1999,
which are incorporated in this prospectus by reference, have been
audited by Rothstein, Kass & Company, P.C., independent certified
public accountants, as indicated in their report. The
consolidated financial statements are incorporated in this
prospectus by reference in reliance on the report of Rothstein,
Kass & Company, P.C., given on the authority of that firm as
experts in accounting and auditing.
ADDITIONAL INFORMATION ABOUT ALPHA
Alpha files annual, quarterly and special reports,
proxy statements and other information with the Securities and
Exchange Commission ("SEC"). You may read and copy any of the
information on file with the SEC at the SEC's public reference
rooms in Washington, D.C., New York, New York, and Chicago,
Illinois. Copies of the filed documents can be obtained by mail
from the Public Reference Section of the SEC at Room 1024, 450
Fifth Street, N.W. Washington, D.C. 20549, at prescribed rates.
You may call the SEC at 1-800-SEC-0330 for further information on
the public reference rooms. Filed documents are also available
to the public at the SEC's website at http://www.sec.gov.
Alpha has filed with the SEC a registration statement on
Form S-3 with respect to the common stock that may be sold under
this prospectus. This prospectus does not contain all of the
information set forth in that registration statement, certain
parts of which are not included in accordance with the rules and
regulations of the SEC. Copies of that registration statement
can be obtained from the Public Reference Section of the SEC at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates.
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows a company to "incorporate by reference"
information it files with the SEC, which means that Alpha can
disclose important information to you by referring you to those
documents. The information incorporated by reference is an
important part of this prospectus, and information that Alpha
files later with the SEC will automatically update and supersede
this information. Alpha incorporates by reference the documents
listed below and any future filings made with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934, until all of the shares offered under this prospectus
are sold.
(a) Alpha's annual report on Form 10-K for the fiscal year
ended December 31, 1999;
(b) Alpha's quarterly report on Form 10-Q for the fiscal quarter
ended March 31, 2000;
(c) Alpha's current report on Form 8-K, as filed with the
SEC on February 15, 2000;
(d) Alpha's current report on Form 8-K, as filed with the
SEC on April 28, 2000;
(e) Alpha's quarterly report on Form 10-Q for the fiscal quarter
ended June 30, 2000; and
(f) Alpha's registration statement on Form S-1, as filed with
the SEC on August 8, 1996 (with respect to the description of the
common stock).
Any statement contained in a document incorporated or deemed
to be incorporated by reference in this prospectus shall be
deemed to be modified or superseded for purposes of this
prospectus to the extent that a statement contained in this
prospectus or in any other subsequently filed document that also
is or is deemed to be incorporated by reference in this
prospectus modifies or supersedes that statement. Any statement
so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this prospectus.
You may request, and Alpha will send to you, without charge,
copies of documents that are incorporated by reference in this
prospectus but that are not delivered to you (other than exhibits
to such documents that are not specifically incorporated by
reference). You may request these copies by writing or
telephoning Alpha at: Alpha Hospitality Corporation, 12 East 49th
Street, New York, New York 10017, attention: Thomas W. Aro,
telephone number (212) 750-3500.
