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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 1, 1996
American Casino Enterprises, Inc.
(Exact name of Registrant as specified in its charter)
Nevada 0-10061 04-2709807
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or organization) File Number) Identification No.)
6243 Industrial Road, Las Vegas, Nevada 89118
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (702) 896-8888
N/A
(Former name or former address, if changed since last report)
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Item 5. Other Events
On February 1, 1996, American Casino Enterprises, Inc. (the "Company")
entered into a settlement agreement (the "Settlement Agreement") of an
administrative proceeding commenced against the Company by the National Indian
Gaming Commission (the "NIGC"). The Settlement Agreement resolves all issues
associated with the Notice of Violation and a Notice to Show Cause issued by
the NIGC against the Company on July 15, 1994.
The Notice of Violation alleged that the Company was engaged in the
management of the Table Mountain Rancheria Bingo and Casino (the "Casino"), a
gaming facility owned by the Table Mountain Band of Indians of the Table
Mountain Rancheria (the "Tribe") without an NIGC-approved management contract,
and that the Company was operating Class III gaming activities at the Casino
without an approved tribal-state compact. In the Notice to Show Cause, the NIGC
took the position that as a result of the foregoing alleged violations, the
Company's 1993 Consulting Agreement with the Tribe, as amended (the "1993
Agreement"), should be disapproved by the NIGC. The Company appealed from both
Notices, and the matters had been pending before a hearing officer within the
Department of the Interior.
Under the Settlement Agreement, the NIGC agreed to fully withdraw and
dismiss any and all charges, allegations and claims against the Company. In
turn, the Company agreed to terminate the 1993 Agreement and, without admitting
or denying the NIGC's allegations, pay a civil fine of $500,000.
In addition to the execution of the Settlement Agreement, on February
1, 1996, the Company entered into a termination agreement with the Tribe (the
"Termination Agreement") which terminated the 1993 Agreement and simultaneously
entered into a new consulting agreement (the "1996 Agreement"). Under the
conditions of the Termination Agreement, commencing February 1, 1996, the Tribe
is required to pay the Company 48 monthly installments of $350,000 in
consideration for termination of the 1993 Agreement. However, the Tribe is not
required to make payment for any month in which the net revenue of the Casino
does not equal or exceed $1 Million. The term of the Termination Agreement
shall be automatically extended by one month for each month that the Tribe is
not required to make a payment thereunder, for up to a maximum of 12 months.
The 1996 Agreement has a term of 27 months and requires the Company to
consult and provide technical assistance, training and advice to the Tribe
concerning all matters relating to the operation and business activities of the
Casino, including but not limited to, organization and administration, planning
and development, gaming activities, internal controls and accounting
procedures, cage operations, engineering and maintenance, housekeeping, human
resources, management information services,
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marketing and advertising, purchasing, surveillance, security, and food and
beverage operations. For its services under the 1996 Agreement, the Company
will receive minimum monthly payments of $90,000. The Tribe is also required to
pay the Company an additional $90,000 for each increment of $500,000, or
portion thereof, of Casino net revenue in excess of the first $1.5 Million of
net revenue from Casino operations. The Company believes that its revenues
derived from the 1996 Agreement and under the Termination Agreement will result
in revenues that are consistent with those currently produced under the 1993
Agreement, provided that the Casino's net revenues remain stable or increase
during the term of the 1996 Agreement.
As part of the overall settlement, the NIGC has reviewed the
Termination Agreement and the 1996 Agreement between the Company and the
Tribe and has advised both parties that these agreements are not "management
contracts" under the Indian Gaming Regulatory Act or the NIGC's regulations,
and, therefore, do not require approval of the NIGC chairman.
Item 7. Financial Statements and Exhibits.
99.1 Order of the United States Department of the Interior, dated
February 1, 1996.
99.2 Settlement Agreement, dated February 1, 1996, by and between the
Company and the NIGC.
99.3 Termination Agreement, dated February 1, 1996, by and between the
Company and the Tribe. Exhibit A to the Termination Agreement is set foth as
Exhibit 99.4 below, and Exhibit B to the Termination Agreement, the 1993
Agreement, is incorporated herein by reference to the Company's Annual Report
on Form 10-KSB for the year ended July 31, 1994.
99.4 Consulting Agreement, dated February 1, 1996, by and between the
Company and the Tribe.
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SIGNATURE
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, thereunto duly authorized.
Date: February 1, 1996 AMERICAN CASINO ENTERPRISES, INC.
By: /s/ Ronald J. Tassinari
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Ronald J. Tassinari
President
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