SECURITIES AND EXCHANGE COMMISSION
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURUSANT TO
SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
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BLACK HAWK GAMING & DEVELOPMENT COMPANY, INC.
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[Carl Thompson Associates Letterhead]
FOR IMMEDIATE RELEASE: November 9, 2001
CONTACTS:
Stephen R. Roark Carl Thompson
President and Chief Financial Officer Chief Executive Officer
Stan Politano Carl Thompson Associates
Vice President (800) 959-9677
Black Hawk Gaming & Development
(303) 582-1117
BLACK HAWK GAMING & DEVELOPMENT COMPANY
REPORTS THIRD QUARTER RESULTS AND STATUS OF BUYOUT OFFER
BLACK HAWK, Colorado -- Black Hawk Gaming & Development Company, Inc.
(Nasdaq: BHWK), today announced results for its third quarter and nine-month
period ended September 30, 2001.
THIRD QUARTER RESULTS
Net income for the third quarter, after privatization costs and other non-
recurring costs totaling $151,000, increased to $1,546,000 compared to net
income of $1,502,000 for the third quarter of last year. Earnings per diluted
share for the third quarter, after privatization costs and other non-recurring
costs was $.36 per share, equal to the comparable quarter last year. Third
quarter net revenue increased to $26 million from $20 million for the same
quarter last year.
NINE MONTH RESULTS
Net income for the nine-month period, after privatization costs and other
non-recurring costs totaling $1,266,000, decreased to $3 million compared to
$4.8 million for the nine-month period last year. Earnings per diluted share
for the nine-month period, after privatization costs and other non-recurring
costs, decreased to $.70 for the first nine months of this year compared to
$1.17 per share for the same period last year. Nine-month net revenue increased
to $73.6 million from $60.7 million for the corresponding period last year.
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Financial Highlights (unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
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2001 2000 2001 2000
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Net Revenue $26,026,000 $20,354,000 $73,618,000 $60,741,000
Net Income $ 1,546,000 $ 1,502,000 $ 3,009,000 $ 4,844,000
Earnings per Diluted Share $ 0.36 $ 0.36 $ 0.70 $ 1.17
Weighted Average Shares Outstanding
(Diluted) 4,343,763 4,198,300 4,320,611 4,155,112
BALANCE SHEET DATA September 30, December 31,
2001 2000
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Total Assets $128,534,000 $97,476,000
Total Liabilities and Minority Interest $ 84,484,000 $55,414,000
Shareholders' Equity $ 43,829,000 $42,062,000
STATUS OF BUYOUT OFFER
As previously announced, on April 27, 2001, Black Hawk executed a merger
agreement with Gameco, Inc., an entity controlled by Jeffrey P. Jacobs, Chairman
of the Board and Chief Executive Officer of Black Hawk. The merger agreement
calls for Gameco to pay $12.00 per share, in cash, for each share of common
stock of Black Hawk not currently owned by Mr. Jacobs or his affiliates and
Black Hawk will become a wholly-owned subsidiary of Gameco. Consummation of the
transaction is subject to various conditions, including approval by Black Hawk's
stockholders and obtaining of gaming licensing approvals in Colorado and Nevada.
Also as previously announced, on September 21, 2001, Black Hawk was advised
that Gameco and its financial advisors were evaluating carefully the impact of
the September 11, 2001 terrorist attacks in New York City and Washington, D.C.,
on the capital markets and Gameco's proposed high yield debt offering. Gameco
further advised that it was considering alternative financing arrangements.
Today, the Special Committee recommended and the full Board of Directors of
Black Hawk Gaming granted to Gameco, an extension until April 1, 2002 to arrange
for financing and close the transaction. Gameco informed the Board that it will
provide the Committee and the Board with a "highly confident" letter from its
financial advisors, stating that they are confident they can arrange financing
for Gameco to complete the acquisition of Black Hawk in the first quarter of
2002. The Special Committee and the full Board of Directors of Black Hawk
Gaming believe that it is in the best interest of the shareholders to provide
Gameco the additional time. If the transaction fails to close by April 1, 2002,
Black Hawk may terminate the merger agreement and receive liquidated damages of
$2 million.
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Black Hawk intends to hold a special meeting of shareholders to approve the
merger agreement with Gameco in January, 2002. It is expected that Colorado and
Nevada gaming approvals will be obtained in January or February, 2002.
INFORMATION CONCERNING PARTICIPANTS
Black Hawk and its directors may be deemed to be participants in the
solicitation of proxies from Black Hawk stockholders to approve the merger. Some
of the directors of Black Hawk have an interest in the merger that may differ
from or may be in addition to the interests of Black Hawk stockholders
generally. Those interests, which are described in greater detail in the proxy
statement with respect to the merger, include the interest of Mr. Jacobs in the
equity of Gameco and potential employment relationships of other directors.
IMPORTANT INFORMATION AND WHERE TO FIND IT
Black Hawk has filed and will mail to its stockholders a proxy statement
containing information about Black Hawk, the proposed merger, and related
matters. Stockholders are urged to read the proxy statement carefully as it
contains important information that stockholders should understand before making
a decision about the merger. Black Hawk will mail this proxy statement to its
stockholders to seek their approval of the merger. The proxy statement as well
as other filings containing information about Black Hawk, can be obtained
without charge at the SEC's web site (http://www.sec.gov). Copies of the proxy
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statement, when available, and Black Hawk's SEC filings will also be obtainable,
without charge, from Stanley Politano, Black Hawk's Secretary at Black Hawk
Gaming & Development Company, Inc., 240 Main Street, Black Hawk, Colorado 80422,
(303) 582-1117.
This press release contains forward-looking statements that involve risks
and uncertainties relating to future events, including whether and when the
proposed merger will be consummated. These risks and uncertainties could cause
actual events or results to differ materially from those expressed or implied by
the forward-looking statements. These factors include, but are not limited to,
risks that adequate financing, stockholder approval, gaming approvals, and other
clearances and consents may not be obtained in a timely manner or at all and
that any other conditions to the merger may not be satisfied. Black Hawk assumes
no obligation to update the forward-looking information.
Note: News releases and other information about Black Hawk Gaming &
Development Company, Inc. are available at http://www.bhwk.com
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