SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: AUGUST 15, 1997
-------------------------------
AMERICAN BINGO & GAMING CORP.
-----------------------------
(Exact name of small business issuer as specified in its charter)
DELAWARE 1-13530 74-2723809
-------- ------- ----------
(State or other jurisdiction of Commission (I.R.S. Employer
incorporation or organization) File Number Identification No.)
515 CONGRESS AVENUE, SUITE 1200, AUSTIN, TEXAS 78701
--------------------------------------------------------
(Address of principal executive offices)
(512) 472-2041
--------------
(Registrant's telephone number)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
- ----------------------------------------------------
GOLD STRIKE, INC. ACQUISITION
- --------------------------------
On August 14, 1997 the Company entered into a contract with Michael Mims, a
non-affiliate, to acquire Gold Strike, Inc., a South Carolina corporation in
the video gaming machine business, pursuant to completion of the Company's
final due diligence on Gold Strike. This acquisition is intended to close on
August 25, 1997. Upon closing, Mr. Mims will become an officer and director of
the Company.
This acquisition will be consummated in a stock-for-stock exchange, with
American Bingo exchanging approximately 828,000 of its common shares for 100%
of all outstanding shares of Gold Strike. The Company believes that the value
of this consideration is approximately three times Gold Strike's annual cash
flows. There is no cash consideration involved in this acquisition.
The Company will acquire all of Gold Strike's assets used in the gaming
industry business, including equipment, machinery, real property, fixtures,
leasehold interests, inventory, prepaid expenses, contractual and leasehold
rights and all other tangible and intangible assets. The Company will likewise
assume all liabilities related to these assets. The Company will continue to
use all acquired assets in the gaming industry business.
The Company intends to account for this acquisition as a pooling, assuming
that the transaction qualifies; otherwise the transaction will be accounted
for as a purchase. If the transaction is treated as a purchase, the Company
will value this acquisition at the current fair market value of its issued
securities, less a discount for lack of marketability, pursuant to a
three-year Company lock-up on the sale of the securities.
This acquisition involves consideration in excess of 10% of the Company's
total assets. The Company intends to file all required financial statements
and exhibits within 60 days under cover of Form 8.
ITEM 5. OTHER EVENTS
- -----------------------
EQUITY FINANCING
- -----------------
On August 4, 1997 the Company completed a $2.0 million equity financing with
Plazacorp, Inc. The Company issued 2,000 Preferred Series A shares, $.01 par
value, at the price of $1,000 per share. After financing commissions and legal
and accounting fees, the Company netted approximately $1.82 million from this
financing. The Company plans to use these funds primarily for acquisition
costs.
The Company intends to register these securities under Form S-3. The Preferred
Shares bear interest at 7% per annum and are convertible into common shares
under a variable pricing formula between $4.00 and $5.50 per share. Under this
formula, the Company expects to issue a minimum of 363,636 shares and a
maximum of 500,000 shares. The shares are convertible in four blocks as
follows:
<TABLE>
<CAPTION>
Date Percent Amount
- ----------------- -------- ----------
<S> <C> <C>
November 2, 1997 15% $ 300,000
December 17, 1997 25% $ 500,000
January 31, 1998 30% $ 600,000
April 1, 1998 30% $ 600,000
- ----------------- -------- ----------
TOTAL 100% $2,000,000
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMERICAN BINGO & GAMING CORP.
(Registrant)
August 15, 1997
By: /s/ Greg Wilson
--------------------------
Greg Wilson, Principal Executive Officer
