Gem Stockholders
LAS VEGAS, May 7 /PRNewswire/ -- Ameristar Casinos, Inc. (Nasdaq: ASCA) today announced that a settlement has been reached in the arbitration proceeding against Steven W. Rebeil and Dominic J. Magliarditi, the former stockholders of Gem Gaming, Inc. ("Gem"). Gem, the original developer of The Reserve casino-hotel in Henderson, Nev., was merged into an Ameristar subsidiary in October 1996. On March 26, 1997, Ameristar commenced an arbitration proceeding against the former Gem stockholders related to the merger agreement and the amount and terms of payment of the merger consideration.
Pending approval by the Nevada Gaming Control Board and the Nevada Gaming Commission, the settlement agreement provides for principal payments totaling $32,650,000, of which $4,000,000 is to be paid at closing. Notes will be issued for the remaining principal balance with interest at 8% per annum. Principal reduction payments of up to $3.0 million annually will be required commencing in November 1998, and the notes will mature on December 31, 2004. The notes are prepayable without penalty. The notes will be subordinated to up to $250 million in indebtedness selected by Ameristar. Pursuant to the settlement, Ameristar will transfer back to a Gem affiliate Ameristar's interest in an aircraft and hanger facilities acquired in connection with the merger.
"We are very pleased that a settlement has been reached," said Craig H. Neilsen, Ameristar President and CEO. "Final design plans for The Reserve are currently being completed. We anticipate this settlement will allow us to finalize financing and accelerate construction on the project."
This press release contains forward-looking statements, and actual results may differ materially from those anticipated in or contemplated by this press release due to factors beyond the control of Ameristar. These factors include, but are not limited to, uncertainties concerning the completion of one or more financing transactions and the approval of the settlement terms by the Nevada gaming authorities.
Ameristar Casinos, Inc., a publicly traded company with a strong background in the gaming and hospitality industry dating back to 1954, owns and operates Cactus Petes Resort Casino and The Horseshu Hotel & Casino in Jackpot, Nev., Ameristar Casino Vicksburg in Vicksburg, Miss., and Ameristar Casino Council Bluffs in Council Bluffs, Iowa. Ameristar also owns The Reserve, a safari-themed casino-hotel, under development in Henderson, Nev. in metropolitan Las Vegas.
SOURCE Ameristar Casinos Inc.
Copyright © 1997, PR Newswire, all rights reserved.
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