UNITED STATES
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 (Date of earliest event reported): June 4, 2015
Lakes Entertainment, Inc.
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(Exact name of registrant as specified in its charter)
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| Minnesota | 0-24993 | 41-1913991 | ||
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(State or other jurisdiction of |
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(Commission File Number) |
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(IRS Employer |
| incorporation) | Identification No.) |
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130 Cheshire Lane, Suite 101, Minnetonka, Minnesota |
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55305 |
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(Address of principal executive offices) |
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(Zip Code) |
| Registrant’s telephone number, including area code: | (952) 449-9092 |
Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[X] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On June 4, 2015, Lakes Entertainment, Inc. (“Lakes”) entered into (i) the First Amendment to Agreement and Plan of Merger (the “Merger Agreement Amendment”) with Sartini Gaming, Inc. (“Golden”), LG Acquisition Corporation, and The Blake L. Sartini and Delise F. Sartini Family Trust (“Sartini Trust”), which amends that certain Agreement and Plan of Merger, dated as of January 25, 2015, among Lakes, Golden, LG Acquisition Corporation and the Sartini Trust (as so amended, the “Merger Agreement”), and (ii) Amendment No. 1 to that certain Voting and Support Agreement, dated as of January 25, 2015, among Lakes, Golden, Lyle A. Berman and the other Lakes’ shareholders listed therein (the “Support Agreement Amendment” and such agreement as amended, the “Support Agreement”).
The Merger Agreement Amendment and the Support Agreement Amendment have been entered into to address the potential concern that the terms of the Support Agreement and the Shareholders’ Agreement by and among Lakes, Golden, Sartini Trust, Lyle A. Berman and the other Lakes’ shareholders party thereto (the “Shareholders’ Agreement”) could be deemed to give rise to a “control share acquisition” under the Minnesota Control Share Acquisition Act, Minnesota Statutes Section 302A.671 (“CSAA”).
Accordingly, the Merger Agreement Amendment requires, among other matters, Lakes to (i) solicit shareholder approval at its annual shareholders meeting (the “Annual Shareholders Meeting”) to be held after the special shareholders meeting scheduled for June 17, 2015 (the “Special Shareholders Meeting”) and prior to consummation of the merger under the Merger Agreement, of an amendment to the Bylaws of Lakes, as amended, to eliminate any potential effects of the CSAA on, and render the CSAA inapplicable to, Lakes and all shares of Lakes, including the Lakes’ shares subject to the Support Agreement and Shareholders’ Agreement (the “CSAA Opt Out”) and (ii) obtain such shareholder approval as a condition to Golden’s obligation to consummate the merger under the Merger Agreement.
The Support Agreement Amendment, among other matters, (i) provides that Lyle A. Berman and the other Lakes’ shareholders who are parties to the Support Agreement are in no event obligated to vote shares subject to the Support Agreement that in the aggregate represent 20% or more of the voting power of the outstanding Lakes’ shares and (ii) requires that Mr. Berman and the other Lakes’ shareholders who are parties to the Support Agreement vote their shares that in the aggregate represent less than 20% of the total voting power of all the outstanding Lakes’ shares in favor of the CSAA Opt Out at the Annual Shareholders Meeting.
Item 8.01 Other Events
Because the Support Agreement could be deemed to give rise to a “control share acquisition” under the CSAA, Mr. Berman and the other shareholders party to the Support Agreement have determined that they will not vote at the Special Shareholders Meeting scheduled for June 17, 2015 any shares subject to the Support Agreement that in the aggregate represent 20% or more of the voting power of all outstanding Lakes’ shares (“Share Voting Limitation”). As a result, approximately 783,000 shares will not be voted at such Special Shareholders Meeting.
In order to (i) eliminate any uncertainties relating to the applicability of the CSAA to the Support Agreement and the Shareholders’ Agreement, (ii) eliminate in their entirety all restrictions that the CSAA has on Lakes’ shareholders, and (iii) comply with the terms of the Merger Agreement Amendment, Lakes plans to submit to its shareholders, at its Annual Shareholders Meeting (tentatively scheduled for late July or early August 2015) a proposal to approve an amendment to Lakes’ Bylaws, as amended, to approve the CSAA Opt Out, which will apply to any existing or future transaction in Lakes’ shares. A committee of the Lakes’ Board formed in accordance with Subdivision 1 of Minnesota Statutes Section 302A.671 has approved, subject to shareholder approval, the amendment to the Lakes’ Bylaws, as amended, to effect the CSAA Opt Out. Such committee and the Lakes’ Board recommend that Lakes’ shareholders approve the amendment. Mr. Berman and the other shareholders party to the Support Agreement have determined that they will abide by the Share Voting Limitation at such Annual Shareholders Meeting.
Additional Information and Where to Find It
This filing may be deemed to be solicitation material for the shareholder vote with respect to the issuance of shares of Lakes common stock under the Merger Agreement. In connection with the Merger Agreement, Lakes filed a definitive proxy statement for the special meeting of Lakes shareholders to be held on June 17, 2015 and may file other relevant materials and documents with the SEC. The definitive proxy statement has been mailed to Lakes’ shareholders. This filing does not constitute a solicitation of any vote or proxy from any shareholder of Lakes. INVESTORS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT IN ITS ENTIRETY AND ANY OTHER DOCUMENTS OR MATERIALS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED MERGER OR INCORPORATED BY REFERENCE IN THE DEFINITIVE PROXY STATEMENT BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT LAKES, GOLDEN AND THE PROPOSED MERGER. Investors may obtain free copies of the definitive proxy statement, and other relevant materials and documents filed with the SEC, without charge, at the SEC’s web site at www.sec.gov. In addition, investors may obtain free copies of the definitive proxy statement, and other relevant materials and documents filed with the SEC by directing a written request to Investor Relations, Lakes Entertainment, Inc., 130 Cheshire Lane, Suite #101, Minnetonka, MN 55305, or by accessing Lakes’ website at www.lakesentertainment.com under the heading “Investors” and then “SEC Filings.”
Participants in the Solicitation
Lakes, Golden and their respective directors, executive officers and certain other members of management and employees may be deemed to be “participants” in the solicitation of proxies from shareholders of Lakes in connection with the proposed transaction, including with respect to the issuance of shares of Lakes common stock under the Merger Agreement. Information about the Lakes’ directors and executive officers is available in Lakes definitive proxy statement, dated July 23, 2014, for its 2014 annual meeting of shareholders. Additional information regarding participants in the proxy solicitation and a description of their interests in the proposed transaction is contained in the definitive proxy statement that Lakes filed with the SEC on May 4, 2015 in connection with the proposed transaction and other relevant documents or materials that may be filed with the SEC regarding the proposed transaction.
Item 9.01 Financial Statements and Exhibits
| (d) | Exhibits | |
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2.1 |
First Amendment to Agreement and Plan of Merger, dated as of June 4, 2015, among Lakes Entertainment, Inc., Sartini Gaming, Inc., LG Acquisition Corporation and The Blake L. Sartini and Delise F. Sartini Family Trust. |
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10.1 |
Amendment No. 1 dated June 4, 2015, to that certain Voting and Support Agreement, dated January 25, 2015, among Lakes Entertainment, Inc., Lyle A. Berman and the other Lakes’ shareholders party thereto. |
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 thereunto duly authorized.
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LAKES ENTERTAINMENT, INC. |
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(Registrant) |
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| Date: June 4, 2015 | /s/ Timothy J. Cope |
| Name: Timothy J. Cope | |
| Title: President and Chief Financial Officer |
EXHIBIT INDEX
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2.1 |
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The First Amendment dated June 4, 2015, to the Agreement and Plan of Merger, dated January 25, 2015, among Lakes Entertainment, Inc. Sartini Gaming, Inc., LG Acquisition Corporation and The Blake L. Sartini and Delise F. Sartini Family Trust. | ||||
| 10.1 | Amendment No. 1 dated June 4, 2015, to the Voting and Support Agreement dated January 25, 2015, among Lakes Entertainment, Inc., Lyle A. Berman and the other Lakes’ shareholders party thereto | |||||
Exhibit 2.1
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this “Amendment”), dated as of June 4, 2015, is entered into by and among Lakes Entertainment, Inc., a Minnesota corporation (“Parent”), LG Acquisition Corporation, a Nevada corporation and a wholly-owned subsidiary of Parent (“Merger Subsidiary”), Sartini Gaming, Inc., a Nevada corporation (the “Company”), and The Blake L. Sartini and Delise F. Sartini Family Trust (the “Stockholder,” and, together with Parent, Merger Subsidiary and the Company, the “Parties” and each a “Party”), to amend that certain Agreement and Plan of Merger, dated as of January 25, 2015, by and among the Parties (the “Merger Agreement”).
WHEREAS, the Parties desire to amend the Merger Agreement, as set forth herein.
NOW THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein and in the Merger Agreement, and intending to be legally bound hereby, the Company, Parent, Merger Subsidiary and the Stockholder hereby agree as follows:
1. Parent Annual Shareholder Meeting. Section 5.9 of the Merger Agreement is hereby amended by inserting the following subsection (e) immediately after subsection (d) thereof:
“(e) As promptly as reasonably practicable, but in any event by no later than two Business Days after the Parent Shareholder Approval is obtained at the Parent Special Meeting, Parent shall, with the assistance of the Company, prepare the proxy statement for the Parent Annual Shareholder Meeting (such proxy statement, the “Annual Meeting Proxy Statement”) and file the Annual Meeting Proxy Statement with the SEC. Parent shall use its reasonable best efforts to resolve all SEC comments with respect to the Annual Meeting Proxy Statement as promptly as practicable after receipt thereof. Parent will promptly correct any information in the Annual Meeting Proxy Statement, if and to the extent that it shall have become false or misleading in any material respect prior to the Parent Annual Shareholder Meeting. Parent shall cause the Annual Meeting Proxy Statement, as so corrected, to be filed with the SEC and to be disseminated to its shareholders, in each case as and to the extent required by applicable federal securities laws. Section 5.9(b)-(c) shall apply mutatis mutandis to the Parent Annual Shareholder Meeting, the Annual Meeting Proxy Statement and the Additional Parent Shareholder Approval (except that Parent shall use its reasonable best efforts to conduct the Parent Annual Shareholder Meeting on or prior to July 31, 2015, unless the Parties mutually agree to some other date). The Parent Board of Directors shall take all lawful action which it reasonably deems necessary to solicit, and shall recommend, the approval of the Bylaws Amendment. Parent shall include in the Annual Meeting Proxy Statement a statement that the Parent Board of Directors recommends that Parent’s shareholders vote to approve the Bylaws Amendment at the Parent Annual Shareholder Meeting. The expenses incurred in connection with the filing, printing and mailing of the Annual Meeting Proxy Statement (including applicable SEC filing fees) and the solicitation of the Additional Parent Shareholder Approval shall be paid by Parent.”
2. Conditions to Company’s Obligations. Section 7.3(a) of the Merger Agreement is hereby amended and restated in its entirety as follows:
“(a) The Parent Shareholder Approval and the Additional Parent Shareholder Approval shall have been obtained.”
3. Termination Rights. Section 8.1(g)(i) of the Merger Agreement is hereby amended and restated in its entirety as follows:
“(i) the Parent Shareholder Approval is not obtained at the Parent Special Meeting or the Additional Parent Shareholder Approval is not obtained at the Parent Annual Shareholder Meeting.”
4. Fees and Expenses. Section 8.3(b)(ii) of the Merger Agreement is hereby amended and restated in its entirety as follows:
“(A) an Acquisition Proposal shall have been made by any party (a “Proposing Party”) directly to Parent’s shareholders or otherwise publicly disclosed prior to the taking of the vote to receive either the Parent Shareholder Approval at the Parent Special Meeting or any adjournment or postponement thereof or the Additional Parent Shareholder Approval at the Parent Annual Shareholder Meeting or any adjournment or postponement thereof, (B) this Agreement is thereafter terminated by either the Company or Parent pursuant to Sections 8.1(b), 8.1(d) or 8.1(g)(i), and (C) within 12 months of the date of such termination of this Agreement, Parent or any of its Subsidiaries enters into any definitive agreement with respect to, or consummates, any Acquisition Proposal with the Proposing Party or its Affiliates,”
5. Definitions. Section 11.1 of the Merger Agreement is hereby amended by inserting the following definitions in alphabetical order:
““Additional Parent Shareholder Approval” means the affirmative vote of a majority of the voting power of the shares present and entitled to vote, in person or by proxy, at the Parent Annual Shareholder Meeting, to approve the Bylaws Amendment.
“Bylaws Amendment” means an amendment to the Bylaws of Parent, as amended, in form and substance reasonably satisfactory to the Company, and which has been approved by a committee of the Parent Board of Directors made up of individuals who meet the requirements of Subdivision 1(a)(1)-(4) of Section 302A.671 of the Minnesota Business Corporation Act, that renders Section 302A.671 of the Minnesota Business Corporation Act entirely inapplicable to Parent and that entirely eliminates its effects with respect to Parent and all shares of Parent, including with respect to its applicability to and effect on this Agreement, the Merger, the Parent Voting Agreements and any other transaction contemplated hereby or thereby.
“Parent Annual Shareholder Meeting” means the 2015 annual meeting of shareholders of Parent.”
6. Miscellaneous. Except as set forth in this Amendment, the Merger Agreement remains unmodified and in full force and effect. This Amendment shall be governed by, construed and enforced in accordance with the internal laws of the State of Minnesota (regardless of the laws that might otherwise govern under applicable principles of conflicts of law). This Amendment may be signed in any number of counterparts and signatures may be delivered by facsimile or electronic image scan transmission, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Amendment shall become effective when each Party shall have received a counterpart hereof signed by the other Parties. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Merger Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written.
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PARENT: |
LAKES ENTERTAINMENT, INC. | |
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By: |
/s/ Timothy J. Cope |
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Timothy J. Cope | |
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President and Chief Financial Officer | |
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MERGER SUBSIDIARY: |
LG ACQUISITION CORPORATION | |
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| By: | /s/ Timothy J. Cope | |
| Timothy J. Cope | ||
| President and Chief Financial Officer | ||
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| COMPANY: | SARTINI GAMING, INC. | |
| By: | /s/ Blake L. Sartini | |
| Blake L. Sartini | ||
| Chief Executive Officer | ||
| STOCKHOLDER: |
THE BLAKE L. SARTINI AND DELISE F. SARTINI FAMILY TRUST | |
| By: | /s/ Blake L. Sartini | |
| Blake L. Sartini | ||
| Trustee | ||
| By: | /s/ Delise F. Sartini | |
| Delise F. Sartini | ||
| Trustee | ||
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Exhibit 10.1
AMENDMENT NO. 1
TO
VOTING AND SUPPORT AGREEMENT
This Amendment No. 1 (this “Amendment”), dated as of June 4, 2015, to that certain Voting and Support Agreement, dated as of January 25, 2015 (the “Agreement”) is entered into by and among Lakes Entertainment, Inc., a Minnesota corporation (“Parent”), each of the Shareholders (as defined in the Agreement), and Sartini Gaming, Inc., a Nevada corporation (the “Company”).
WHEREAS, contemporaneously with the execution of the Agreement, Parent, Merger Subsidiary, the Company and the Company Stockholder entered into an Agreement and Plan of Merger, dated as of January 25, 2015 (the “Merger Agreement”), providing, among other things, for the merger of Merger Subsidiary with and into the Company (the “Merger”);
WHEREAS, although the parties hereto believe that the entering into the Agreement did not constitute a control share acquisition under Section 302A.671 of the Minnesota Business Corporation Act (the “Control Share Acquisition Statute”), the parties desire to avoid any claim to the contrary that could be made as a result of the performance by the Shareholders of their obligations under the Agreement; and
WHEREAS, on the date hereof, the parties to the Merger Agreement have entered into that certain First Amendment to Agreement and Plan of Merger to amend the Merger Agreement to provide, among other matters, for shareholder approval of an amendment to the First Amended By-Laws of Parent to render the Control Share Acquisition Statute inapplicable to Parent and to eliminate its effect, including with respect to the Merger Agreement, the Merger, this Agreement, the Shareholders’ Agreement (as defined in the Merger Agreement) and any other transactions contemplated hereby or thereby.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth in the Agreement and in the Merger Agreement, and intending to be legally bound hereby, the parties hereto agree to amend the Agreement as follows:
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Section 1 of the Agreement is hereby amended to eliminate the definition of “Proxy” provided therein. |
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Section 2(a)(i) of the Agreement is hereby amended to read as follows: |
(i) in favor of (A) the approval of any Articles Amendment or any amendment to the Bylaws, as amended, of Parent, including any amendment intended to cause the Control Share Acquisition Statute to be inapplicable to Parent; and (B) the approval of the issuance of Parent Common Stock pursuant to the Merger Agreement, and any actions required in furtherance thereof;
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A new Section 2(b) is added to the Agreement to read as follows: |
(b) Notwithstanding any other provision of this Agreement, in no event will the Shareholders be obligated to vote Covered Shares which in the aggregate represent twenty percent (20%) or greater of the voting power of Parent.
Except as specifically amended by this Amendment, all other provisions of the Agreement will remain unchanged and in full force and effect. Capitalized terms used herein which are not defined herein but which are defined in the Agreement shall have the meanings ascribed to them in the Agreement. This Amendment shall be governed by, construed and enforced in accordance with the internal laws of the State of Minnesota (regardless of the laws that might otherwise govern under applicable principles of conflicts of law).
This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
[Signature Pages Follow]
[Signature page to Amendment No. 1 to Voting and Support Agreement]
IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment No. 1 to Voting and Support Agreement to be duly executed effective as of the day and year first above written.
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LAKES ENTERTAINMENT, INC. |
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By: |
/s/ Timothy Cope |
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Name: |
Timothy Cope |
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Title: |
President/CFO |
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| SARTINI GAMING, INC. | |||
| By: | /s/ Blake L. Sartini | ||
| Name: | Blake L. Sartini | ||
| Title: | Chief Executive Officer | ||
[Signature page to Amendment No. 1 to Voting and Support Agreement]
IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment No. 1 to Voting and Support Agreement to be duly executed effective as of the day and year first above written.
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LYLE A. BERMAN |
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/s/ Lyle A. Berman |
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| BERMAN CONSULTING CORPORATION | |||
| By: | /s/ Lyle A. Berman | ||
| Name: Lyle A. Berman | |||
| Title: CEO | |||
| BERMAN CONSULTING CORPORATION PROFIT SHARING PLAN | |||
| By: | /s/ Lyle A. Berman | ||
| Name: Lyle A. Berman | |||
| Title: CEO | |||
| LYLE A. BERMAN REVOCABLE TRUST | |||
| By: | /s/ Lyle A. Berman | ||
| Name: Lyle A. Berman | |||
| Title: CEO | |||
[Signature page to Amendment No. 1 to Voting and Support Agreement]
IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment No. 1 to Voting and Support Agreement to be duly executed effective as of the day and year first above written.
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BRADLEY BERMAN IRREVOCABLE TRUST |
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By: |
/s/ Neil I. Sell |
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Name: Neil I. Sell |
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Title: Co-Trustee |
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| JULIE BERMAN IRREVOCABLE TRUST | |||
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| By: | /s/ Neil I. Sell | ||
| Name: Neil I. Sell | |||
| Title: Co-Trustee | |||
| AMY BERMAN IRREVOCABLE TRUST | |||
| By: | /s/ Neil I. Sell | ||
| Name: Neil I. Sell | |||
| Title: Co-Trustee | |||
| JESSIE LYNN BERMAN IRREVOCABLE TRUST | |||
| By: | /s/ Neil I. Sell | ||
| Name: Neil I. Sell | |||
| Title: Co-Trustee | |||