-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OtUVGlgi7xK/LGygl/hCq9sZ1BjBO5ZkstJubO56GH9uQYM6EX1Hht9s4fXL9lhi 2nwbPoqt96Cro9XMUR4ZBQ== 0000796912-96-000008.txt : 19960813 0000796912-96-000008.hdr.sgml : 19960813 ACCESSION NUMBER: 0000796912-96-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960812 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: PLAYERS INTERNATIONAL INC /NV/ CENTRAL INDEX KEY: 0000796912 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 954175832 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-14897 FILM NUMBER: 96608330 BUSINESS ADDRESS: STREET 1: 800 BILBO ST CITY: LAKE CHARLES STATE: LA ZIP: 70601 BUSINESS PHONE: 3184371560 MAIL ADDRESS: STREET 1: 800 BILBO ST CITY: LAKE CHARLES STATE: LA ZIP: 70601 FORMER COMPANY: FORMER CONFORMED NAME: PLAYERS CLUB INTERNATIONAL INC DATE OF NAME CHANGE: 19861020 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _____________ FORM 10-Q (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF SECURITIES EXCHANGE ACT OF 1943 For the transition period from __________to ___________ Commission file number 0-14897 Players International, Inc. Nevada 95-4175832 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 1300 Atlantic Ave., Suite 800 Atlantic City, NJ 08401 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (609) 449-7777 Former name, former address and former fiscal year, if changed since last report. Indicate by check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No APPLICABLE ONLY TO CORPORATE ISSUERS: The number of shares outstanding of each of the registrant's classes of common stock was 29,187,480 shares at August 12, 1996. PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES INDEX PART I - FINANCIAL INFORMATION PAGE Item 1. Financial Statements Condensed Consolidated Balance Sheets at June 30, 1996 and March 31, 1996 1 Condensed Consolidated Statements of Operations for the Three Months Ended June 30, 1996 and 1995 3 Condensed Consolidated Statements of Cash Flows for the Three Months Ended June 30, 1996 and 1995 4 Notes to Condensed Consolidated Financial Statements 5 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition 7 PART II - OTHER INFORMATION Item 1. Legal Proceedings 11 Item 6. Exhibits and Reports on Form 8-K 13 Signature 14 PART I - FINANCIAL INFORMATION Item 1. Financial Statements PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands) ASSETS June 30, 1996 March 31,1996 (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 20,610 $ 18,786 Marketable securities, net 2,945 4,461 Accounts receivable, net of allowance for doubtful accounts of $280 at June 30, 1996 and $118 at March 31, 1996 6,610 4,541 Notes receivable 768 3,062 Inventories 3,005 2,719 Deferred income tax 2,978 2,970 Prepaid expenses and other current assets 2,806 5,044 Total current assets 39,722 41,583 PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $27,119 at June 30, 1996 and $23,078 at March 31, 1996 289,775 279,916 DEFERRED INCOME TAX - long-term 4,897 4,897 INTANGIBLES, net of accumulated amortization of $2,013 at June 30, 1996 and $1,714 at March 31, 1996 36,966 37,126 INVESTMENT IN JOINT VENTURE 59,474 39,474 OTHER ASSETS 9,674 10,436 TOTAL ASSETS $ 440,508 $ 413,432 PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands, except par value) LIABILITIES AND STOCKHOLDERS' EQUITY June 30, 1996 March 31,1996 (Unaudited) CURRENT LIABILITIES: Accounts payable $ 7,643 $ 6,736 Accrued liabilities 26,299 32,432 Other liabilities 1,662 537 Total current liabilities 35,604 39,705 OTHER LONG-TERM LIABILITIES 27,079 27,100 LONG-TERM DEBT, net of current portion 179,500 153,000 STOCKHOLDERS' EQUITY: Preferred stock, no par value, Authorized--10,000,000 shares Issued and outstanding--none Common stock, $.005 par value, Authorized--90,000,000 shares Issued--29,859,580 at June 30, 1996 and March 31, 1996 149 149 Additional paid-in capital 123,670 123,719 Unrealized loss on marketable securities, net of tax (16) (1) Treasury stock, at cost; 672,100 (7,294) (7,294) shares at June 30, 1996 and March 31, 1996 Retained earnings 81,816 77,054 Total Stockholders' Equity 198,325 193,627 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 440,508 $ 413,432 PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (dollars in thousands, except per share data) (Unaudited) For the Three Months Ended June 30, 1996 1995 REVENUES: Casino $ 72,252 $ 63,110 Food and beverage 3,705 1,668 Hotel 1,811 - Other 1,843 834 79,611 65,612 COSTS AND EXPENSES: Casino 31,455 24,399 Food and beverage 3,745 1,547 Hotel 827 - Other gaming related expenses 23,593 14,496 Corporate administrative expenses 2,372 1,830 Pre-opening and gaming development costs 1,411 5,758 Depreciation and amortization 4,636 3,477 68,039 51,507 Income before other income (expense) and provision for income taxes 11,572 14,105 OTHER INCOME (EXPENSE): Interest income 113 2,123 Other income (expense), net (15) 304 Interest expense (3,864) (3,388) Income before provision for income taxes 7,806 13,144 PROVISION FOR INCOME TAXES 3,044 5,126 NET INCOME $ 4,762 $ 8,018 EARNINGS PER COMMON AND COMMON SHARE EQUIVALENT Primary $ 0.15 $ 0.25 Fully Diluted 0.15 0.25 WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES Primary 31,217,804 32,473,170 Fully Diluted 31,217,804 32,473,501 PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in thousands) (Unaudited) For the Three Months Ended June 30, 1996 1995 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 4,762 $ 8,018 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 4,636 3,477 Other 189 (547) Changes in assets and liabilities: Accounts and notes receivable 62 (1,631) Inventories, prepaid expenses and other current assets 1,878 (2,153) Other assets 331 (7,248) Accounts payable and accrued (7,732) (4,776) liabilities Other liabilities (263) 45 Income tax payable 3,356 (217) Net cash provided by (used in) operating activities 7,219 (5,032) CASH FLOWS FROM INVESTING ACTIVITIES: Net purchases of property and equipment (13,314) (29,704) Purchase of marketable securities - (117,277) Proceeds from sale of marketable securities 1,467 19,245 Investment in joint venture (20,000) - Net cash used in investing activities (31,847) (127,736) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of long-term debt 26,500 150,000 Payments of long-term debt - (8,876) Proceeds from exercise of stock options - 1,157 Other (48) (1) Net cash provided by financing activities 26,452 142,280 NET INCREASE IN CASH AND CASH EQUIVALENTS 1,824 9,512 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 18,786 23,886 CASH AND CASH EQUIVALENTS AT END OF $ 20,610 $ 33,398 PERIOD SUPPLEMENTAL CASH FLOW DISCLOSURE: Interest paid $ 8,855 $ 187 Income taxes paid 4 5,350 Unrealized gain (loss) on marketable securities, net of tax (23) 394 PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1 - Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and the notes thereto included in the Company's Form 10-K for the year ended March 31, 1996. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows of all periods presented have been made. The results of operations for the three month period ended June 30, 1996, are not necessarily indicative of the operating results for the full year. Certain reclassifications have been made to the financial statements as previously presented to conform to current classifications. Note 2 - Casino Revenues and Promotional Allowances Casino revenues are the net of gaming wins less losses. Revenues exclude the retail value of complimentary admissions, food and beverage and other items furnished to customers, which totaled approximately $6,900,000 and $3,941,000 for the three months ended June 30, 1996 and 1995. The estimated cost of providing such complimentary services are included in casino costs and expenses through inter- department allocations from the department granting the services as follows (dollars in thousands): For the Three Months Ended June 30, 1996 1995 Food and beverage $ 5,726 $ 2,784 Hotel 274 - Admissions and other 294 810 $ 6,294 $ 3,584 Note 3 - Pre-opening and Gaming Development Costs All costs in connection with the identification and development of new gaming jurisdictions and sites are being expensed, except for the cost of property and equipment which is capitalized. Note 4 - Primary and Fully Diluted Shares Per share amounts have been computed based on the weighted average number of outstanding shares and common stock equivalents, if dilutive, during each period. A summary of the number of shares used in computing primary earnings per share follows: For the Three Months Ended June 30, 1996 1995 Weighted average number of shares outstanding 29,494,862 29,726,225 Dilutive effect of options and warrants 1,722,942 2,746,945 Shares used in computing primary 31,217,804 32,473,170 earnings per share The number of shares used in computing fully diluted earnings per share is as follows: For the Three Months Ended June 30, 1996 1995 Weighted average number of shares outstanding 29,494,862 29,726,225 Dilutive effect of options and warrants 1,722,942 2,747,276 Shares used in computing fully 31,217,804 32,473,501 diluted earnings per share Note 5 - Long-Term Debt On August 25, 1995, the Company entered into a $120,000,000 reducing revolving credit agreement (the "Credit Line") with a consortium of banks. As of June 30, 1996, there was $29,500,000 outstanding under the Credit Line. Under the Credit Line financial covenant ratios, the Company has $38,300,000 of borrowing capacity as of August 9, 1996. Note 6 - Stockholders' Equity During the quarter ended June 30, 1996, 100,000 put options sold by the Company on its shares with strike prices ranging from $11.00 to $11.50 per share were exercised. The Company elected to settle these exercises in cash. The net effect of these exercises reduced cash and stockholders' equity by $49,000. Note 7 - Contingencies In 1996, Louisiana enacted legislation providing for local (parish-wide) option elections in November 1996 which will give the voters the opportunity to decide whether to continue gaming in their parishes. If a majority of the voters elect to prohibit riverboat gaming activities in Calcasieu Parish, the Company would be allowed to continue gaming at its Louisiana facilities until the expiration of its gaming licenses in August and December of 1998. At June 30, 1996, the Company had approximately $213,300,000 invested in Louisiana and generated approximately $47,300,000 in net gaming revenues during the first quarter of fiscal 1997. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Comparison of Operating Results for the Three Month Periods ended June 30, 1996 and 1995 The Company is a developer and operator of gaming, resort and entertainment facilities. These include a riverboat casino in Metropolis, Illinois, two riverboat casinos in Lake Charles, Louisiana and a land based casino resort in Mesquite, Nevada, which opened on June 29, 1995. The Company also operates a thoroughbred racetrack in Paducah, Kentucky and, through a joint venture, is co-developing a riverboat casino entertainment complex in Maryland Heights, Missouri. The Company's fiscal year ends on March 31. References to the first quarter of 1997 or 1996, mean the three month periods ended June 30, 1996 and June 30, 1995, respectively. Results of Operations Financial Highlights % Increase Three months ended June 30 1996 1995 (Decrease) (Dollars in thousands, except per share amounts) Casino Revenues Metropolis $19,152 $19,596 (2.3)% Lake Charles 47,348 43,448 9.0% Mesquite 5,752 66 n.m. $72,252 $63,110 14.5% Total Revenues Metropolis $19,924 $20,492 (2.8)% Lake Charles 49,827 44,609 11.7% Mesquite 9,540 151 n.m. Other 320 360 (11.1)% $79,611 $65,612 21.3% Operating Income Metropolis $ 5,735 $ 7,216 (20.5)% Lake Charles 11,430 14,790 (22.7)% Mesquite (1,348) (58) n.m. Corporate, Development and Pre- opening expenses (4,245) (7,843) 45.8% $11,572 $14,105 (18.0)% Operating Margin (operating income/total revenues) Metropolis 28.8% 35.2% (6.4)pts Lake Charles 22.9% 33.2% (10.3)pts Mesquite Neg. Neg. n.m. Consolidated 14.5% 21.5% (7.0)pts Depreciation and amortization 4,636 3,477 33.3% Interest expense, net 3,751 1,265 196.5% Net income $ 4,762 $ 8,018 (40.6)% Net income per share $ 0.15 $ 0.25 (40.0)% n.m. - not meaningful neg. - negative The 21.3% increase in revenues during the 1997 first quarter versus the 1996 first quarter, resulted from the opening of Players Island Resort in Mesquite and the addition of gaming, dining, entertainment and parking capacity in Lake Charles. Players Island Resort in Mesquite is a 500 room resort hotel, with a 40,000 square foot casino and a wide variety of dining, entertainment, sports and spa facilities. It opened on June 29, 1995, thus having negligible impact on operations for the first quarter of 1996. An 18-hole championship golf course is presently under construction, with an expected opening in October 1996. In Lake Charles, the Company added the Star riverboat on April 27, 1995, doubling the then-existing gaming space. In October 1995, Players II was replaced with the larger Players III riverboat. In December 1995, a 540 space patron parking garage opened and, in February 1996, a 60,000 square foot floating entertainment "island" added significant dining and entertainment offerings. In anticipation of the December 1995 opening of a competing riverboat casino in Evansville, Indiana, the original Metropolis Players I riverboat was replaced with the larger Players II riverboat in November 1995. In May 1996, a 200 space riverfront parking facility opened. The increased competitiveness of the improved facility limited the impact of the new competition on Metropolis' revenues. Overall operating income decreased 18.0%. The Company invested in additional gaming, entertainment and logistical capacity in Metropolis and Lake Charles in order to meet the demands of new competition. This resulted in increased staffing costs as well as increases in other operating expenses at both facilities. Simultaneously, to maintain or increase market share, the level of expenditure for advertising, marketing, promotions and entertainment was also increased at all properties. In Lake Charles, the per passenger tax paid to local governments was increased by $.50 in August 1995, while admissions charges in both Lake Charles and Metropolis and all parking fees in Lake Charles were eliminated. The operating loss in Mesquite reflects the less than anticipated growth in gaming volume despite very favorable guest response to the resort and spa facilities. Hotel occupancy in Mesquite was 84.5% for the first quarter of 1997. The Mesquite property opened on June 29, 1995, and the Lake Charles Star opened on April 27, 1995. As a result, pre-opening expenses in the first quarter of 1996 were approximately $3.8 million higher than the first quarter of 1997. Depreciation and amortization expense increased primarily as a result of the opening of Players Island Resort in Mesquite and the additional Lake Charles facilities as well as the operation of the Lake Charles Star for the full 1997 quarter compared to two months in the 1996 quarter. The increase was offset by a change in the estimated useful lives of certain depreciable assets and intangibles, effective October 1, 1995. In 1996, Louisiana enacted legislation providing for local (parish-wide) option elections in November 1996 which will give the voters the opportunity to decide whether to continue gaming in their parishes. If a majority of the voters elect to prohibit riverboat gaming activities in Calcasieu Parish, the Company would be allowed to continue gaming at its Louisiana facilities until the expiration of its gaming licenses in August and December of 1998. At June 30, 1996, the Company had approximately $213.3 million invested in Louisiana and generated approximately $47.3 million in net gaming revenues during the first quarter of fiscal 1997. Other Factors Affecting Net Income Net interest expense increased by $2.5 million for the three months ended June 30, 1996, versus the same period in the prior year. Interest cost reflects the $150 million, 10-7/8% Senior Notes issued in April 1995, borrowings under a $120 million revolving bank credit facility entered into in August 1995 (totaling $29.5 million as of June 30, 1996) and imputed interest associated with the August 1995 acquisition of the Downtowner Hotel in Lake Charles. Capitalized interest increased by approximately $1.0 million in the first quarter of 1997, to $1.2 million, due to the ongoing investment in the Maryland Heights project and the development of the Mesquite golf course. Interest income decreased by $2.0 million, as a result of the decrease in investable funds resulting from capital expenditures in Lake Charles, Maryland Heights and Mesquite. Capital Resources, Capital Spending and Liquidity During the first quarter of 1997, cash flow from operations and $26.5 million in borrowings from the Company's $120 million revolving bank credit facility were the sources of funds for capital expenditures, investment in joint venture, debt service and other corporate requirements. During the comparable period in 1996, the primary source of funds for such purposes was the proceeds from the April 1995 issuance of $150 million of 10-7/8% Senior Notes. Operating activities provided $7.2 million in cash in the first quarter of 1997, while using $5.0 million in the first quarter of 1996. The increase is primarily attributable to the issuance costs associated with the Senior Notes in the 1996 first quarter, and a timing change in the payment of quarterly Federal income taxes in the 1997 first quarter. Capital expenditures during the 1997 first quarter totaled $13.3 million, primarily for the ongoing development of the golf course in Mesquite and maintenance capital spending at the Company's three major operating facilities. Capital expenditures do not include a $20.0 million investment during this quarter in the unconsolidated joint venture which is constructing the casino- entertainment facility in Maryland Heights. Capital expenditures during the 1996 first quarter totaled $29.7 million, which consisted principally of construction costs for Players Island Resort in Mesquite and the addition of the Lake Charles Star. The Company has never declared or paid cash dividends on its Common Stock. Under the terms of the revolving bank credit facility, the Company cannot pay cash dividends to the holders of the Common Stock. The Company presently intends to retain earnings to finance the operation and expansion of its business. The Company's portion of the Maryland Heights project is expected to cost approximately $143 million, excluding capitalized interest. As of June 30, 1996, the Company had funded approximately $64.6 million of this amount. The project is expected to open in early 1997, subject to the receipt of all necessary gaming approvals. Management believes that existing cash balances, anticipated cash flow from operations and amounts available under its bank credit facility will be sufficient to complete the Maryland Heights project and the Mesquite golf course. The credit agreement contains certain financial covenants requiring the Company to maintain a specified tangible net worth and to meet certain financial ratios. The credit agreement also contains covenants that restrict the ability of the Company to incur additional debt, make significant capital expenditures or commit funds to new business ventures. As of August 9, 1996, the Company has $38.3 million of borrowing capacity with $24 million of borrowings outstanding under the bank credit agreement. Should other developmental projects be undertaken by the Company it is probable that additional financing would be required. Forward-Looking Information Certain information included in this Quarterly Report on Form 10-Q contains, and other materials filed or to be filed by the Company with the Securities and Exchange Commission (as well as information included in oral statements or other written statements made or to be made by the Company) contain or will contain or include, forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Such forward-looking statements address, among other things, the effects of competition, plans for projects currently under development, plans for future expansion and property enhancements, business development activities, capital expenditure programs and requirements, financing sources and the effects of regulation (including gaming licensure and regulation, state and local regulation and tax regulation). Such forward- looking information is based upon management's current plans or expectations and is subject to a number of uncertainties and risks that could significantly affect current plans, anticipated actions and the Company's future financial condition and results. As a consequence, current plans, anticipated actions and future financial condition and results may differ from those expressed in any forward-looking statements made by or on behalf of the Company. These uncertainties and risks include, but are not limited to, those relating to conducting operations in an increasingly competitive environment, conducting operations at a newly or recently developed site or in a jurisdiction for which gaming has recently been permitted, changes in gaming, state and local laws and regulations (including local referenda to terminate the authority to conduct gaming operations), development and construction activities, leverage and debt service requirements (including sensitivity to fluctuation in interest rates), general economic conditions, changes in federal or state tax laws, action taken under applications for licenses (including renewals) and approvals under applicable laws and regulations (including gaming laws and regulations) and the legalization of gaming in certain jurisdictions. PART II - OTHER INFORMATION Item 1. Legal Proceedings The Company has the following developments to report concerning outstanding legal matters previously reported: Transam, Ltd. d/b/a/ Two Bunch Palms Resort & Spa v. Players International, Inc., et al. On or about November 21, 1995, Transam, Ltd., a Delaware Corporation, d/b/a/ Two Bunch Palms Resort & Spa ("Two Bunch Palms") filed an action in the United States District Court, Central District of California, against the Company, a subsidiary of the Company, certain principals of the Company, and certain other defendants alleging various causes of action arising out of an agreement for services entered into by the Company with Gerald Greenbach and Creative Hospitality Management. Mr. Greenbach, at the time the Agreement was executed by the Company, was an executive of Two Bunch Palms. Mr. Greenbach both individually and through Creative Hospitality Management agreed to provide the Company with a variety of consulting services with respect to the operation and marketing of the Company's spa facilities at Players Island Resort in Mesquite, Nevada. Two Bunch Palms alleges that the Company and/or Mr. Greenbach and Creative Hospitality Management engaged in copyright infringement, trade dress infringement, unfair competition, false advertising, misappropriation of trade secrets, unfair competition as well as certain related allegations with respect to the services provided by Mr. Greenbach and Creative Hospitality Management to the Company. The Company has denied all of these allegations and intends to continue to defend this matter vigorously. Poulos and Ahern Litigation The Company, certain suppliers and distributors of video poker and electronic slot machines and over forty other casino operators have been named as defendants in a class action suit filed April 26, 1994 in the United States District Court, Middle District of Florida, by William Ahern and William H. Poulos. The plaintiffs allege common law fraud and deceit, mail fraud, wire fraud and Racketeer Influenced and Corrupt Organizations Act violations in the marketing and operation of video poker games and electronic slot machines. The suit seeks unspecified damages and recovery of attorney's fees and costs. On December 9, 1994, an Order was entered by the District Court in Florida transferring the consolidated action to the United States District Court for the District of Nevada. The defendants filed various motions seeking dismissal of the action. On April 17, 1996, the Court dismissed plaintiffs' Complaint without prejudice for failure to plead their claims with specificity and dismissed defendants' remaining substantive motions as moot. The Court permitted plaintiffs until May 31, 1996 to file an Amended Complaint, within which time an Amended Complaint was filed. The Company refiled its substantive motions for dismissal of the Amended Complaint, which motions are currently pending. The Company believes that the claims are wholly without merit and does not expect that the lawsuit will have a material adverse effect on the Company's financial position or results of operations. Schreier v. Players International, Inc., et al. On or about October 27, 1995 the Company was served with a purported class action in the United States District Court for the District of Nevada which is essentially identical to the Poulos and Ahearn litigation, except for certain variations in the definition of the purported class. The Company has filed motions to dismiss the Complaint, which are substantively similar to those filed in the Poulos and Ahearn matter. Hyland vs. Players International, Inc., et al This purported class action was filed on May 5, 1995 in the United State District Court, District of New Jersey seeking damages for violation of the Sherman Anti-Trust Act, the Federal Fair Credit Reporting Act and various State law causes of action arising out of an alleged conspiracy on the part of the casino industry to prohibit card counters from playing blackjack. The Compliant named 88 defendants consisting of virtually every casino operating in the North America continent. On October 25, 1995, the Company successfully obtained a voluntary dismissal without prejudice of the plaintiff's Complaint on the grounds that the plaintiff had failed to name the proper corporate entities. On May 30, 1996, the Company granted defendants' motion to dismiss plaintiff's Complaint with prejudice. The Plaintiff failed to appeal this ruling within the appropriate time frame and the dismissal of the Plaintiff's complaint is final. Item 6. Exhibits and Reports on Form 8-K Exhibits Filed with this Form 10-Q Exhibit No. Exhibit Description 3.2 By-laws, as amended, of Players International, Inc. 23.1 Consent of Ernst & Young LLP 23.2 Consent of Ernst & Young LLP 27.0 Financial Data Schedule Reports on Form 8-K Filed During Quarter None SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. PLAYERS INTERNATIONAL, INC. Date: August 12, 1996 By: /s/ Henry M. Applegate Henry M. Applegate, Senior Vice President, Chief Financial Officer and Chief Accounting Officer EX-27 2
5 1000 3-MOS MAR-31-1996 JUN-30-1996 20610 2945 7658 280 3005 39722 316894 27119 440508 35604 179500 149 0 0 198176 440508 0 79611 0 36027 32012 0 3864 7806 3044 4762 0 0 0 4762 .15 .15
EX-3.2 3 BY-LAWS, AS AMENDED OF PLAYERS INTERNATIONAL, INC. ARTICLE I - OFFICES The principal executive office of the Corporation shall be located at 1300 Atlantic Avenue, Suite 800, Atlantic City, NJ 08401 and it may be changed from time to time by the Board of Directors. The Corporation may also maintain offices at such other places within or without the United States as the Board of Directors may, from time to time, determine. ARTICLE II - MEETING OF THE STOCKHOLDERS Section 1 - Annual Meetings: The annual meeting of the stockholders of the Corporation shall be held within six (6) months after the close of the fiscal year of the Corporation or at such later date as may be determined by the Board of Directors, for the purposes of electing directors and transacting such other business as may properly come before the meeting. Section 2 - Special Meetings: Special meetings of the stockholders may be called at any time by the Board of Directors or by the President, and shall be called by the President or the Secretary at the written request of the holder of twenty-five percent (25%) of the shares then outstanding and entitled to vote thereat, or as otherwise required by law. Section 3 - Place of Meetings: All meetings of stockholders shall be held at the principal office of the Corporation, or at such other places as shall be designated in the notices or waivers of notice of such meetings. Section 4 - Notice of Meetings: (a) Except as otherwise provided by statute, written notice of each meeting of stockholders, whether annual or special, stating the time when and place where it is to be held, shall be served either personally or by mail, not less than ten or more than sixty (60) days before the meeting, upon each stockholder of record entitled to vote at such meeting, and to any other stockholder to whom the giving of notice may be required by law. Notice of a special meeting shall also state the purpose or purposes for which the meeting is called, and shall indicate that it is being issued by, or at the direction of, the person or persons calling the meeting. If, at any meeting, action is proposed to be taken that would, if taken, entitle stockholders to receive payment for their share pursuant to statute, the notice of such meeting shall include a statement of that purpose and to that effect. If mailed, such notice shall be directed to each such stockholder at his address, as it appears on the records of the stockholders of the Corporation, unless he shall have previously filed with the Secretary of the corporation a written request that notices intended for him be mailed to the address designated in such request (b) Notice of any meeting need not be given to any person who may become a stockholder of record after the mailing of such notice and prior to the meeting, or to any stockholder who attends such meeting, in person or by proxy, or to any stockholder who, in person or by proxy, submits a signed waiver of notice either before or after such meeting. Notice of any adjourned meeting of stockholders need not be given, unless otherwise required by statute. Section 5 - Quorum: (a) Except as otherwise provided herein, or by statute, or in the Certificate of Incorporation (such certificate and any amendments thereof being hereinafter collectively referred to as the "Certificate of Incorporation"), at all meetings of stockholders of the Corporation, the presence at the commencement of such meetings in person or by proxy of stockholders holding of record 51% of the total number of shares of the Corporation then issued and outstanding and entitled to vote, shall be necessary and sufficient to constitute a quorum for the transaction of any business. The withdrawal of any stockholder after the commencement of a meeting shall have no effect on the existence of a quorum, after a quorum has been established at such meeting. (b) Despite the absence of a quorum at any annual or special meeting of stockholders, the stockholders, by a majority of the votes cast by the holders of shares entitled to vote thereat, may adjourn the meeting. At any such adjourned meeting at which a quorum is present, any business may be transacted at the meeting as originally called is a quorum had been present. Section 6 - Voting: (a) Except as otherwise provided by statute or by the Certificate of Incorporation, any corporate action, other than the election of directors, to be taken by vote of the stockholders, shall be authorized by a majority of votes cast at a meeting of stockholders by the holders of shares entitled to vote thereat. (b) Except as otherwise provided by statute or by the Certificate of Incorporation, at each meeting of stockholders, each holder or record of stock of the corporation entitled to vote thereat, shall be entitled to one vote for each share of stock registered in his name on the books of the Corporation. (c) Each stockholder entitled to vote or to express consent or dissent without a meeting, may do so by proxy; provided, however, that the instrument authorizing such proxy to act shall have been executed in writing by the stockholder himself, or by his attorney-in-fact thereunto duly authorized in writing. No proxy shall be valid after the expiration of eleven (11) months from the date of its execution, unless the person executing it shall have specified therein the length of time it is to continue in force. Such instrument shall be exhibited to the Secretary at the meeting and shall be filed with the minutes of the meeting. (d) Any action, except election of directors, which may be taken by a vote of stockholders at a meeting, may be taken without a meeting if authorized by a written consent of shareholders holding at least a majority of the voting power; provided that if a greater proportion of voting power is required by such action at such meeting, then such greater proportion of written consents shall be required. ARTICLE III - BOARD OF DIRECTORS Section 1 - Number, Election and Term of Office: (a) The number of the directors of the Corporation shall be not less than 1 not more than 9, unless and until otherwise determined by vote of a majority of the entire Board of Directors. The number of Directors shall not be less than three (3), unless all of the outstanding shares of stock are owned beneficially and of record by less than three (3) stockholders, in which event the number of directors shall not be less than the number of stockholders or the minimum permitted by statute. (b) Except as may otherwise be provided herein or in the Certificate of Incorporation the members of the Board of Directors of the Corporation, who need not be stockholders, shall be elected by a majority of the votes cast at a meeting of stockholders, by the holders of shares of stock present in person or by proxy, entitled to vote in the election. There shall be no cumulative voting with respect to the election of the members of the Board of Directors. (c) Each director shall hold office until the annual meeting of the stockholders next succeeding his election, and until his successor is elected and qualified, or until his prior death, resignation, or removal. Section 2 - Duties and Powers: The Board of Directors shall be responsible for the control and management of the affairs, property and interests of the Corporation and may exercise all powers of the Corporation, except as are in the Certificate of incorporation or by statute expressly conferred upon or reserved to the stockholders. Section 3 - Annual and Regular Meetings; Notice: (a) A regular annual meeting of the board of Directors shall be held immediately following the annual meeting of the stockholders, at the place of such annual meeting of stockholders. (b) The Board of Directors, from time to time, may provide by resolution for the holding of other regular meetings of the Board of Directors, and may fix the time and place thereof. (c) Notice of any regular meeting of the Board of Directors shall not be required to be given and, if given, need not specify the purpose of the meeting; provided, however, that in case the Board of Directors shall fix or change the time or place of any regular meeting, notice of such action shall be given to each director who shall not have been present at the meeting at which such change was made within the time limited, and in the manner set forth in Paragraph (b) Section (4) of this Article III, with respect to special meetings, unless such notice shall be waived in the manner set forth in Paragraph (c) of such Section 4. Section 4 - Special Meeting; Notice: (a) Special meetings of the Board of Directors shall be held whenever called by the President or by one of the directors, at such time and place as may be specified in the respective notices or waivers of notice thereof. (b) Except as otherwise required by statute, notice of a special meeting shall be mailed directly to each director, addressed to him at his residence or usual place of business, at least four (4) days before the day on which the meeting is to be held, or shall be sent to him at such place by facsimile transmission telegram, radio, or cable, or shall be delivered to him personally or given to him orally, not later than the day before the day on which the meeting is to be held. A notice, or waiver of notice except as required by Section 8 of this Article III, need not specify the purpose of the meeting. (c) Notice of any special meeting shall not be required to be given to any director who shall attend such meeting without protesting prior thereto or at its commencement, the lack of notice to him or who submits a signed waiver of notice, whether before or after the meeting. Notice of any adjourned meeting shall not be required to be given. Section 5 - Chairman: At all meetings of the Board of Directors, the Chairman of the Board, if any and if present, shall preside. If there shall be no Chairman, or he shall be absent, then the Vice Chairman shall preside, and in his absence, a Chairman chosen by the directors shall preside. Section 6 - Quorum and Adjournments: (a) At all meetings of the Board of Directors, the presence of a majority of the entire Board shall be necessary and sufficient to constitute a quorum for the transaction of business, except as otherwise provided by law, by the Certificate of Incorporation or by these By-Laws. (b) A majority of the directors, present at the time and place of any regular or special meeting, although less than a quorum, may adjourn the same from time to time without notice, until a quorum shall be present. Section 7 - Manner of Acting: (a) At all meetings of the Board of Directors, each director present shall have one vote, irrespective of the number of shares of stock, if any, which he may hold. (b) Except as otherwise provided by statute, by the Certificate of Incorporation, or by these By-Laws, the action of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors. (c) Unless otherwise required by amendment to the Articles of Incorporation or statute, any action required or permitted to be taken at any meeting of the Board of Directors or any Committee thereof may be taken without a meeting if a written consent thereto is signed by all the members of the Board or Committee. Such written consent shall be filed with the minutes of the proceedings of the Board or Committee. (d) Unless otherwise prohibited by Amendments to the Articles of Incorporation or statute, members of the Board of Directors or of any Committee of the Board of Directors may participate in a meeting of such Board or Committee by means of a conference telephone network or a similar communications method by which all persons participating in the meeting can hear each other. Such participation is constituted presence of all the participating persons at such meeting The minutes of any such meeting shall be either signed or otherwise approved by the persons participating in the meeting. Section 8 - Vacancies: Any vacancy in the Board of Directors, occurring by reason of an increase in the number of directors, or by reason of the death, resignation, disqualification, removal (unless vacancy created by the removal of a director by the stockholders shall be filled by the stockholders at the meeting at which the removal was effected) or inability to act of any director, or otherwise, shall be filled for the unexpired portion of the term by a majority vote of the remaining directors, though less than a quorum, at any regular meeting or special meeting of the Board of Directors called for that purpose. Section 9 - Resignation: Any director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary of the Corporation. Unless otherwise specified in such written notice such resignation shall take effect upon receipt thereof by the Board of Directors or such officer, and the acceptance of such resignation shall not be necessary to make it effective. Section 10 - Removal: Any director may be remove with or without cause at any time by the affirmative vote of stockholders holding of record in the aggregate at least a majority of the outstanding share of stock of the Corporation at a special meeting of the stockholders called for that purpose, and may be removed for cause by action of the Board. Section 11 - Compensation: The Board of Directors may, from time to time, establish or alter by resolution appropriate compensation to be paid to all members of the Board of Directors who are not otherwise employed by the Corporation. The Board of Directors may also establish, and from time to time alter, appropriate compensation for service by a member of the Board of Directors as Chairman of a Committee of the Board of Directors. The Board shall establish a fixed sum to be paid to non-employee members of the Board of Directors for attendance at any Committee meetings and shall provide for the payment of expenses of members of the Board of Directors for attendance at any meetings of the Board of Directors or of a Committee thereof. Nothing herein contained shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. Section 12 - Contracts: (a) No contract or other transaction between this Corporation and any other corporation shall be impaired, affected or invalidated, nor shall any director be liable in any way by reason of the fact that any one or more of the directors of this Corporation is or are interested in, or is a director or officer, or are directors or officers of such other corporation, provided that such facts are disclosed or made known to the Board of Directors, prior to their authorizing such transaction. (b) Any director, personally or individually, may be a party to or may be interested in any contract or transaction of this Corporation, and no director shall be liable in any way by reason of such interest, provided that the fact of such interest be disclosed or made known to the Board of Directors prior to their authorization of such contract or transaction, and provided that the Board of Directors shall authorize, approve or ratify such contract or transaction by vote (not counting the vote of any such Director) of a majority of a quorum, notwithstanding the presence of any such director at the meeting at which such action is taken. Such director or directors may be counted in determining the presence of a quorum at such meeting. This Section shall not be construed to impair or invalidate or in any way affect any contract or other transaction which would otherwise be valid under the law (common, statutory or otherwise) applicable thereto. Section 13 - Committees: The Board of Directors, by resolution adopted by a majority of the entire Board, may from time to time designate from among its members an executive committee and such other committees, and alternate members thereof, as they may deem desirable, with such powers and authority (to the extent permitted by law) as may be provided is such resolution. Each such committee shall serve at the pleasure of the Board. ARTICLE IV - OFFICERS Section 1 - Number, Qualifications, Election and Term of Office: (a) The officers of the Corporation shall consist of a President, a Secretary, a Treasurer, or a President and Secretary- Treasurer, and such other officers, including a Chairman of the Board of Directors, and one or more Vice Presidents, as the Board of Directors may form time to time deem advisable. Any officer other than the Chairman or Vice Chairman of the Board of Directors may be, but is not required to be a director of the Corporation. Any two or more offices may be held by the same person. (b) The officers of the Corporation shall be elected by the Board of Directors at the regular annual meeting of the Board following the annual meeting of the stockholders. (c) Each officer shall hold office until the annual meeting of the Board of Directors next succeeding his election, and until his successor shall have been elected and qualified or until his death, resignation, or removal. Section 2 - Resignation: Any officer may resign at any time by giving written notice of such resignation to the Board of Directors, or to the President or the Secretary of the Corporation. Unless otherwise specified in such written notice, such resignation shall take effect upon receipt thereof by the Board of Directors or by such officer, and the acceptance of such resignation shall not be necessary to make it effective. Section 3 - Removal: Any officer may be remove, either with or without cause, and a successor elected by a majority vote of the Board of Directors at any time. Section 4 - Vacancies: A vacancy in any office by reason of death, resignation, inability to act, disqualification, or any other cause, may at any time be filled for the unexpired portion of the term by a majority vote of the Board of Directors. Section 5 - Duties of Officers: Officers of the Corporation shall, unless otherwise provided by the Board of Directors, each have such powers and duties as generally pertain to their respective offices as will as such powers and duties as may be set forth in these by-laws, or may from time to time be specifically conferred or imposed by the Board of Directors. The President shall be the chief executive officer of the corporation, unless otherwise provided. Section 6 - Sureties and Bonds: In case the Board of Directors shall so require any officer, employee, or agent of the Corporation shall execute to the Corporation a bond in such sum. and with such surety or sureties as the Board of Directors may direct, conditioned upon the faithful performance of his duties to the Corporation, including responsibility for negligence for the accounting for all property, funds or securities of the corporation which may come into his hands. Section 7 - Share of Stock of Other Corporations: Whenever the Corporation is the holder of shares of stock of any other corporation, any right or power of the Corporation as such stockholder (including the attendance, acting and voting at stockholder's meetings and execution of waivers, consents proxies or other instruments) may be exercised on behalf of the Corporation by the President, any Vice President or such other person as the Board of Directors may authorize. ARTICLE V - SHARES OF STOCK Section 1 - Certificate of Stock: (a) The certificates representing shares of the Corporation's stock shall be in such form as shall be adopted by the Board of Directors, and shall be numbered and registered in the order issued. They shall bear the holder's name and the number of shares of stock and shall be signed by (i) the Chairman of the Board or the President or a Vice President, and (ii) the Secretary or Treasurer, or any Assistant Secretary or Assistant Treasurer, and shall bear the corporate seal. (b) No certificate representing share of stock shall be issued until the full amount of consideration therefor has been paid, except as otherwise permitted by law. (c) To the extent permitted by law, the Board of Directors may authorize the issuance of certificates for fractions of a share of stock which shall entitle the holder to exercise voting rights, receive dividends and participate in liquidating distributions, in proportion to the fractional holdings; or it may authorize the payment in cash of the fair value of fractions of a share of stock as of the time when those entitled to receive such fractions are determined; or it may authorize the issuance, subject to such conditions as may be permitted by law, of scrip in registered or bearer form over the signature of an officer or agent of the Corporation, exchangeable as therein provided for full shares of stock, but such scrip shall not entitle the holder to any rights of a stockholder, except as therein provided. Section 2 - Lost or Destroyed Certificates: The holder of any certificate representing shares of stock of the Corporation shall immediately notify the corporation of any loss or destruction of the certificate representing the same. The Corporation may issue a new certificate in the place of any certificate theretofore issued by it, alleged to have been lost or destroyed. On production of such evidence of loss or destruction as the Board of Directors in its discretion may require, the Board of Directors may, in its discretion require the owner of the lost or destroyed certificate, or his legal representatives, to give the corporation a bond in such sum as the Board may direct, and with such surety or sureties as may be satisfactory to the Board, to indemnify the Corporation against any claims, loss, liability or damage it may suffer on account of the issuance of the new certificate. A new certificate may be issued without requiring any such evidence or bond when, in the judgement of the Board of Directors, it is proper to do so. Section 3 - Transfer of Shares: (a) Transfer of shares of stock of the Corporation shall be made on the stock ledger of the Corporation only by the holder of record thereof, in person or by his duly authorized attorney, upon surrender for cancellation of the certificate or certificates representing such share of stock with an assignment or power of transfer endorsed thereon or delivered therewith, duly executed, with such proof of the authenticity of the signature and of authority to transfer and of payment of taxes as the Corporation or its agents may require. (b) The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the absolute owner thereof for all purposes and, accordingly, shall not be bound to recognize any legal, equitable or other claim to, or interest in, such share or shares of stock on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by law. Section 4 - Record Date: In lieu of closing the stock ledger of the corporation, the Board of Directors may fix, in advance, a date not exceeding sixty (60) days, nor less than ten (10) days, as the record date for the determination of stockholders entitled to receive notice of, or to vote at, any meeting of stockholders, or to consent to any proposal without a meeting, or for the purpose of determining stockholders entitled to receive payment of any dividends or allotment of any rights, or for the purpose of any other action. If no record date is fixed, the record date for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if no notice is given, the day preceding the day on which the resolution of the directors relating thereto is adopted. When a determination of stockholders of record entitled to notice of or to vote at any meeting of stockholders has been made as provided for herein, such determination shall apply to any adjournment thereof, unless the directors fix a new record date for the adjourned meeting. ARTICLE VI - DIVIDENDS Subject to applicable law, dividends may be declared and paid out of any funds available therefor, as often, in such amounts, and at such time or times as the Board of Directors may determine. ARTICLE VII - FISCAL YEAR The fiscal year of the Corporation shall be March 31 and may be changed by the Board of Directors from time to time subject to applicable law. ARTICLE VIII - CORPORATE SEAL The corporate seal shall be in such form as shall be approved from time to time by the Board of Directors. ARTICLE IX - INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHER PERSONS Section 1 - Right to Indemnification: Each Indemnitee (as defined below) shall be indemnified and held harmless by the corporation for all actions taken by him and for all failures to take action (regardless of the date of any such action or failure to take action) to the fullest extent permitted by the Nevada General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, the rights of indemnification provided hereby shall continue as theretofore to the maximum extent permitted by law notwithstanding such amendment unless such amendment permits the corporation to provide broader indemnification rights than the law permitted the Corporation to provide prior to such amendment), against all expense, liability and loss (including attorneys' fees, judgements, fines, Employee Retirement Income Security Act excise taxes or penalties and amounts paid or to be paid in settlement) actually and reasonably incurred or suffered by the Indemnitee in connection with any Proceeding (as defined below). The right to indemnification conferred in this Article shall be a contract right and shall include the right to be paid by the corporation the expenses incurred by an Indemnitee in defending a civil or criminal action, suit or proceeding as they are incurred and in advance of the final disposition of such action, suit or proceeding; provided, however, that, if the Nevada General Corporation Law continues so to require, the payment of such expenses incurred by an Indemnitee in advance of the final disposition of such action, suit or proceeding, shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such Indemnitee, to repay all amounts so advanced if it shall ultimately be determined by a court of competent jurisdiction that such Indemnitee is not entitled to be indemnified by the Corporation under this Article or otherwise. (ii) Indemnification pursuant to this Section shall continue as to an Indemnitee who has ceased to be a director or officer and shall inure to the benefit of his or her heirs, executors and administrators. (iii) For purpose of this Article, (A), "Indemnitee" shall mean each director or officer of the Corporation who was or is a party or is threatened to be made a party to any Proceeding, by reason of the fact that he is or was director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, or other enterprise, including service with respect to employee benefit plans; and (B) "Proceeding" shall mean any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, or investigative. Section 2 - Indemnification of Employees and Agents: The Corporation may, by action of its Board of Directors, provide indemnification to employees and agents of the corporation with the same scope and effect as of the foregoing indemnification of directors and officers. Section 3 - Non-Exclusivity of Rights: The rights to indemnification and to the advancement of expenses provided in this Article shall not be exclusive of any other rights that any person may have or hereafter acquire under any statute, provision of the Articles of Incorporation or By- laws, agreement, vote of stockholders or disinterested directors or otherwise for either an action in his official capacity while holding his office; provided, however, if the Nevada General Corporation Law so requires, indemnification, unless ordered by a court (with respect to a proceeding by or in the right of the Corporation) or for the advancement of expenses as set forth in Section 1 above, may not be made to or behalf of any director or officer if a final adjudication establishes that his acts or omissions involved intentional misconduct, fraud or a knowing violation of the law and was material to the cause of action. Section 4 - Insurance: The Corporation may purchase and maintain insurance or make any other financial arrangements permitted by applicable law on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise for any liability asserted against him and liability and expenses incurred by him in his capacity as a director, officer, employee or agent, or arising out of his status of such, whether or not the Corporation has the authority to indemnify him against such liability and expenses. ARTICLE X - AMENDMENTS Section 1 - By Stockholders: All by-laws of the Corporation shall be subject to alteration or repeal, and new by-laws may be made, by the affirmative vote of stockholders holding of record in the aggregate at least a majority of the outstanding shares of stock entitled to vote in the election of directors at any annual or special meeting of stockholders, provided that the notice or waiver of notice of such meeting shall have summarized or set forth in full therein, the proposed amendment. Section 2 - By Directors: The Board of Directors shall have power to make, adopt, alter, amend and repeal, from time to time, by-laws of the Corporation; provided, however, that the stockholders entitled to vote with respect thereto as in this Article X above-provided may alter, amend or repeal by-laws made by the Board of Directors, except that the Board of Directors shall have no power to change the quorum for meetings of stockholders or the Board of Directors or to change any provisions of the by-laws with respect to the removal of directors or the filling of vacancies in the Board resulting from the removal by the stockholders. EX-23.1 4 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-37412) pertaining to the Players International, Inc. Incentive Stock Option Plan (1985), Players International, Inc. Stock Option Plan for Non-Employee Directors, Players International, Inc. 1990 Incentive Stock Option and Non-Qualified Option Plan of our report dated May 23, 1996, with respect to the consolidated financial statements of Players International, Inc. included in the Annual Report (Form 10-K) for the year ended March 31, 1996. Ernst & Young LLP Philadelphia, Pennsylvania August 12, 1996 EX-23.2 5 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-70110) pertaining to the Players International, Inc. Amended and Restated 1993 Stock Incentive Plan of our report dated May 23, 1996, with respect to the consolidated financial statements of Players International, Inc. included in the Annual Report (Form 10- K) for the year ended March 31, 1996. Ernst & Young LLP Philadelphia, Pennsylvania August 12, 1996 -----END PRIVACY-ENHANCED MESSAGE-----