Back to GetFilings.com
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-8570
CIRCUS CIRCUS ENTERPRISES, INC.
(Exact name of Registrant as specified in its charter)
Nevada 88-0121916
(State or other jurisdiction of (I.R.S. Employer incorporation
incorporation or organization) Identification No.)
2880 Las Vegas Boulevard South, Las Vegas, Nevada 89109-1120
(Address of principal executive offices (Zip Code)
Registrant's telephone number, including area code:(702) 734-0410
Securities registered pursuant to Section 12(b) of the Act:
Title of Class Name of Exchanges on which Registered
Common Stock, $.01-2/3 Par Value New York Stock Exchange and
Pacific Stock Exchange
Common Stock Purchase Rights New York Stock Exchange and
Pacific Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark 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
Indicate by check mark if disclosure of delinquent
filers pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of Registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The aggregate market value of the voting stock of the
Registrant held by persons other than the registrant's directors
and executive officers as of April 25, 1997 (based upon the last
reported sale price on the New York Stock Exchange on such date)
was $1,936,961,369.
The number of shares of Common Stock, $.01-2/3 par
value, outstanding at April 25, 1997: 94,862,033.
DOCUMENTS INCORPORATED BY REFERENCE
PART II - Portions of the Registrant's Annual Report to
Stockholders for the year ended January 31, 1997 are incorporated
by reference into Items 7 and 8, inclusive.
PART III - Portions of the Registrant's definitive
proxy statement in connection with the annual meeting of
stockholders to be held on June 24, 1997, are incorporated by
reference into Items 10 through 13, inclusive.
PART I
ITEM 1. BUSINESS.
General
Circus Circus Enterprises, Inc. (the "Company"), which
was incorporated in 1974, currently owns and operates, through
wholly owned subsidiaries, nine hotel-casino properties in Nevada
with a total of approximately 17,700 guest rooms, reflecting the
December 1, 1996 closing of the 1,169-room Hacienda Hotel and
Casino and the placement in service of a total of approximately
2,950 new rooms at Circus Circus-Las Vegas and Luxor since
December 1996. These properties include (i) three hotel/casinos
in Las Vegas (Circus Circus-Las Vegas, Luxor and Excalibur), (ii)
the Circus Circus Hotel and Casino in Reno, (iii) the Colorado
Belle Hotel and Casino and the Edgewater Hotel and Casino which
are located on the Colorado River in Laughlin, (iv) Gold Strike
Hotel and Gambling Hall and the Nevada Landing Hotel & Casino in
Jean, and (v) Railroad Pass Hotel and Casino in Henderson. The
Company also owns and operates a dockside casino situated on a
24-acre site in Tunica County, Mississippi and operates two
smaller casinos on the Las Vegas Strip, Slots-A-Fun (which the
Company also owns) and the Silver City Casino (which the Company
operates under a long-term lease).
The Company, through wholly owned subsidiaries, is a
50% participant in (i) a joint venture (the Las Vegas Joint
Venture ) which owns and operates Monte Carlo, a hotel-casino on
the Las Vegas Strip which opened in June 1996, (ii) a joint
venture (the "Reno Joint Venture") which owns and operates Silver
Legacy, a hotel-casino located in downtown Reno that opened in
July 1995 and is situated between (and connected by enclosed
climate-controlled skyways to) Circus Circus-Reno and another
hotel-casino owned and operated by an affiliate of the other
participant in the Reno Joint Venture, and (iii) a joint venture
(the "Elgin Joint Venture") which owns and operates The Grand
Victoria, a riverboat casino, and a related land-based
entertainment complex located in Elgin, Illinois. In January
1997, the Company disposed its one-third interest in a company
which operates an interim casino in Windsor, Ontario, Canada.
For additional information concerning the projects with which the
Company is involved through the aforementioned joint ventures,
see "Joint Venture Participations" in this Item 1.
Unless the context otherwise indicates, all references
to the Company are to Circus Circus Enterprises, Inc. and its
subsidiaries.
Significant Recent Developments
Since December 23, 1996, the Company has placed in
service a new 1,000-room hotel tower at Circus Circus-Las Vegas
and approximately 1,950 rooms in two new 22-story hotel towers at
Luxor. The expansion program at Luxor has also involved
substantial changes to the original facility, including the
removal of the Nile River feature to provide for a better
utilization of the space on the ground level of the main casino
and the relocation of the hotel s front desk to provide easier
customer access. This work, which significantly impacted
operations at Luxor during fiscal 1997, was substantially
completed by the end of fiscal 1997. The remainder of the
expansion program will be completed in stages with final
completion currently anticipated to occur in fall of 1997 and
will add additional retail areas, two new restaurants, a multi-
purpose showroom and include a reworking of the attractions
level. For additional information concerning the new facilities,
see Description of the Company's Operating Hotels and Casinos
in this Item 1.
On December 1, 1996, the Company closed the 1,169-room
Hacienda Hotel and Casino, which was imploded on December 31,
1996 to make way for construction of a 42-story, 3,800-room
hotel-casino resort (currently referred to as Project Paradise )
and a 400-room Four Seasons Hotel. Construction of Project
Paradise commenced in the spring of 1997 and is currently
expected to be completed in late 1998 or early 1999. For
additional information concerning Project Paradise and the Four
Seasons Hotel, see Current Expansion Activities in this Item 1.
In late 1996, the Company commenced construction of a
1,200-room hotel tower at its Tunica County, Mississippi casino,
Circus Circus-Tunica, which will be remodeled and rethemed into a
more elegant resort to be operated under the name Gold Strike
Casino Resort. For additional information concerning this
project, see Current Expansion Activities in this Item 1.
In June 1996, the Las Vegas Joint Venture (in which the
Company owns a 50% interest) completed and opened Monte Carlo, a
major destination resort on the Las Vegas Strip with 3,002 hotel
rooms, including 253 suites. For additional information
concerning this property and the Las Vegas Joint Venture, see
Joint Venture Participations in this Item 1.
In January 1997, the Company disposed of its one-third
interest in a company operating an interim casino in Windsor,
Ontario, Canada.
Description of the Company's Operating Hotels and Casinos
Las Vegas, Nevada
Circus Circus-Las Vegas. Circus Circus-Las Vegas, the
Company's original property, is a circus-themed hotel and casino
complex situated on approximately 69 acres on the north end of
the Las Vegas Strip. The property, which has a total of 3,744
hotel rooms (1,000 of which are included in a new tower completed
in December 1996), includes approximately 109,000 square feet of
casino space where, as of January 31, 1997, 2,555 slot machines
and other coin-operated devices and 84 gaming tables (including
blackjack ("21"), craps, pai gow poker, Caribbean stud poker, a
wheel of fortune and roulette) as well as poker, keno and a race
and sports book were available to the casino's patrons. From a
"Big Top" above the casino, Circus Circus-Las Vegas offers its
guests a variety of circus acts performed free of charge from 11
a.m. to midnight daily. A mezzanine area overlooking the casino
has a circus midway with carnival-style games and an arcade that
offers a variety of amusements and electronic games. Four
specialty restaurants, a buffet with a seating capacity of
approximately 1,200, two coffee shops, several fast food snack
bars, four cocktail bars and two cocktail service bars and a
variety of gift shops and specialty shops are also available to
the guests at Circus Circus-Las Vegas. Grand Slam Canyon, an
"adventuredome" covering approximately five acres, offers theme
park entertainment that includes a high-speed, double-loop,
double-corkscrew roller coaster, a coursing river flume ride on
white-water rapids, several rides and attractions designed for
preschool age children, themed carnival-style midway games, a
state-of-the-art arcade, a 65-foot waterfall, fully animated
life-size dinosaurs in their primeval habitat, food kiosks and
souvenir shops, all in a climate-controlled setting under a giant
space-frame dome. On-site parking is available for approximately
4,700 vehicles, including three garages that will accommodate
approximately 3,200 vehicles. Circus Circus-Las Vegas also
offers accommodations for approximately 384 recreational vehicles
at the property's Circusland RV Park.
Luxor. Luxor, which opened in October 1993, is an
Egyptian-themed hotel and casino complex which features a
30-story pyramid and two new 22-story hotel towers which opened a
majority of their 1,950 rooms in December 1996 and the remainder
by February 1997. With the addition of the new towers, Luxor now
contains 4,425 hotel rooms, including 492 suites. The new hotel
towers are part of an expansion program at Luxor which also
included the addition of 20,000 square feet of convention space,
extensive remodeling of the casino level of the pyramid,
relocation of the hotel s front desk, the reworking of the front
entrance, relocating and retheming the buffet and connecting
Luxor to Excalibur by a climate-controlled skyway with moving
walkways. The expansion program will continue into the current
year and will ultimately include a reworked attractions level,
two new restaurants and a new multi-purpose showroom. The
remainder of the expansion will be completed in stages with final
completion currently anticipated to occur in fall of 1997.
Situated at the south end of the Las Vegas Strip on a 64-acre
site adjacent to Excalibur, Luxor features a food and
entertainment area on three different levels beneath a soaring
hotel atrium. The pyramid s hotel rooms can be reached from the
four corners of the building by state-of-the-art "inclinators"
which travel at a 39-degree angle. Luxor includes approximately
120,000 square feet of casino space where, as of January 31,
1997, 2,245 slot machines and other coin-operated devices and 110
gaming tables (including blackjack ("21"), craps, pai gow poker,
Caribbean stud poker, a wheel of fortune and roulette) as well as
poker, keno and a race and sports book were available to the
casino's patrons. Above the pyramid s casino, a series of IMAX
special-format filmed attractions are designed to seemingly
transport visitors to extraordinary places of times past, present
and future. Luxor's other public areas include a buffet with a
seating capacity of approximately 800, five themed restaurants
including two gourmet restaurants, as well as a snack bar, seven
cocktail lounges and a variety of specialty shops. Parking is
available for nearly 3,200 vehicles, including a garage which
contains approximately 1,800 spaces.
Excalibur. Excalibur is a castle-themed hotel and
casino complex situated on the south end of the Las Vegas Strip
on a 53-acre site adjacent to Luxor. Excalibur, which is
connected to Luxor by a new climate-controlled skyway with moving
walkways, has a total of 4,008 hotel rooms and offers its guests
more than 400,000 square feet of public entertainment area,
including approximately 110,000 square feet of casino space
where, as of January 31, 1997, 2,442 slot machines and other
coin-operated devices and 89 gaming tables (including blackjack
("21"), craps, pai gow poker, Caribbean stud poker, a wheel of
fortune and roulette) as well as poker, keno and a race and
sports book were available to the casino's patrons. Excalibur's
other public areas include a Renaissance faire, a medieval
village, an amphitheater with seating capacity of nearly 1,000
where nightly mock jousting tournaments and costume drama are
presented, two dynamic motion theaters, various artisans' booths
and medieval games of skill. In addition, Excalibur has a buffet
with seating capacity of approximately 1,300, six themed
restaurants, as well as four snack bars, several cocktail lounges
and a variety of specialty shops. Parking is available for
approximately 4,000 vehicles, including a garage which contains
approximately 1,400 spaces.
Other Las Vegas Properties. The Silver City Casino and
Slots-A-Fun have 18,200 and 16,700 square feet of casino space,
respectively. Both casinos depend on foot traffic along the Las
Vegas Strip for their business. As of January 31, 1997, the
Silver City Casino had 570 slot machines and other coin-operated
devices and 21 gaming tables, while Slots-A-Fun had 632 such
machines and devices and 25 gaming tables.
Reno, Nevada
Circus Circus-Reno. Circus Circus-Reno is a circus-
themed hotel and casino complex situated in downtown Reno,
Nevada. The property, which has a total of 1,605 hotel rooms
(all of which were refurbished during the fiscal year ended
January 31, 1997), includes approximately 60,000 square feet of
casino space where, as of January 31, 1997, 1,722 slot machines
and other coin-operated devices and 66 gaming tables (including
blackjack ("21"), craps, pai gow poker, Caribbean stud poker, a
wheel of fortune and roulette) as well as poker, keno and a race
and sports book were available to the casino's patrons. From a
"Big Top" above the casino, Circus Circus-Reno also offers its
guests a variety of circus acts performed free of charge from 11
a.m. to midnight daily. A mezzanine area has a circus midway
with carnival-style games and an arcade that offers a variety of
amusements and electronic games. The facilities at Circus
Circus-Reno also include two specialty restaurants, a buffet with
a seating capacity of approximately 450, a coffee shop, a
deli/bakery, a fast food snack bar, five cocktail lounges, a gift
shop and specialty shops. Parking is currently available for
over 3,000 vehicles, including space for approximately 1,850
vehicles in a new parking garage which opened at the end of
fiscal 1997. For information concerning the Company's
participation in a joint venture which owns and operates Silver
Legacy, a casino, hotel and entertainment complex which is
connected to Circus Circus-Reno by an enclosed skywalk, see
"Joint Venture Participations -- Reno Joint Venture" in this
Item 1.
Laughlin, Nevada
Colorado Belle. The Colorado Belle Hotel and Casino is
situated on a 22-acre site on the bank of the Colorado River
(with 1,080 feet of river frontage) in Laughlin, Nevada,
approximately 90 miles south of Las Vegas. The Colorado Belle
features a 600-foot replica of a Mississippi riverboat, 1,226
hotel rooms and a casino with approximately 64,000 square feet of
space where, as of January 31, 1997, 1,362 slot machines and
other coin-operated devices and 40 gaming tables (including
blackjack ("21"), craps, pai gow poker, Caribbean stud poker and
roulette) as well as poker, keno and a sports book were available
to the casino's patrons. The Colorado Belle's facilities also
include a 350-seat buffet, a coffee shop, three specialty
restaurants, two fast food snack bars, five cocktail lounges and
a cocktail service bar as well as a gift shop and other specialty
shops. There is surface parking available for approximately
1,700 vehicles.
Edgewater. The Edgewater Hotel and Casino is situated
on a 16-acre site adjacent to the Colorado Belle in Laughlin,
Nevada with approximately 1,640 feet of frontage on the Colorado
River. The property, which has 1,450 hotel rooms, includes
approximately 44,000 square feet of casino space where, as of
January 31, 1997, 1,346 slot machines and other coin-operated
devices and 42 gaming tables (including blackjack ("21"), craps,
pai gow poker, Caribbean stud poker, a wheel of fortune and
roulette) as well as poker, keno and a race and sports book were
available to the casino's patrons. The Edgewater's facilities
also include a specialty restaurant, a coffee shop, a buffet with
a seating capacity of 735, a snack bar and three cocktail
lounges. There is surface parking available for approximately
1,350 vehicles and a parking garage which can accommodate
approximately 930 additional vehicles.
Jean, Nevada
Gold Strike. Gold Strike Hotel & Gambling Hall, which
opened in December 1987 and was acquired by the Company in June
1995, is an "old west" themed hotel-casino located on
approximately 51 acres of land on the east side of I-15, the
primary thoroughfare between Las Vegas and southern California.
The property includes, among other amenities, approximately
37,000 square feet of casino space, 813 hotel rooms, several
restaurants, a gift shop, a swimming pool and spa, a banquet
center equipped to serve 260 people and parking spaces for
approximately 2,100 cars. As of January 31, 1997, 1,090 slot
machines and other coin-operated devices and 22 gaming tables
(including blackjack ("21"), craps, Caribbean stud poker, and
roulette) as well as poker and keno were available to the
casino's patrons. The casino has a stage bar with regularly
scheduled live entertainment and a casino bar. Gold Strike also
offers a children's arcade in order to accommodate the numerous
families that visit the property.
Nevada Landing. Built in 1989 and acquired by the
Company in June 1995, Nevada Landing Hotel & Casino is a turn-of-
the-century riverboat themed hotel-casino located on
approximately 55 acres of land across I-15 from Gold Strike. The
property includes approximately 36,000 square feet of casino
space, 303 hotel rooms, a 72-seat Chinese restaurant, a full-
service coffee shop, an all-you-can-eat buffet, a snack bar, a
gift shop, a swimming pool and spa, a 300-guest banquet facility
and parking spaces for approximately 1,400 cars. As of January
31, 1997, 1,050 slot machines and other coin-operated devices and
20 gaming tables (including blackjack ("21"), craps, Caribbean
stud poker and roulette) as well as keno and a sports book were
available to the casino's patrons.
Henderson, Nevada
Railroad Pass. Railroad Pass Hotel & Casino, which was
acquired by the Company in June 1995, is situated on
approximately 56 acres along US-93, the direct route between Las
Vegas and Phoenix, Arizona. The property includes, among other
amenities, approximately 21,000 square feet of casino space, 120
hotel rooms, two bars, two full-service restaurants, an all-you-
can-eat buffet, gift shop, swimming pool, a 194-guest banquet
facility and parking spaces for approximately 580 cars. As of
January 31, 1997, Railroad Pass' casino offered 395 slot machines
and 11 gaming tables (including blackjack ( 21 ),craps and
roulette) as well as a keno lounge, a sports book and free bingo
three days per week. In contrast with the Company's other Nevada
properties, Railroad Pass caters to local residents, particularly
from Henderson, who often prefer the informal, friendly
atmosphere and easy access of Railroad Pass over the casinos on
the Las Vegas Strip.
Tunica County, Mississippi
Circus Circus-Tunica. Circus Circus-Tunica, which
opened in August 1994, is a dockside casino situated on a 24-acre
site along the Mississippi River in Tunica County, Mississippi,
approximately three miles west of Mississippi State Highway 61 (a
major north/south highway connecting Memphis, Tennessee with
Tunica County) and approximately 20 miles south of Memphis. The
current facility has a total of approximately 127,000 square feet
of space, including approximately 48,000 square feet of casino
space. As of January 31, 1997, 1,372 slot machines and other
coin-operated devices and 44 gaming tables (including blackjack
("21"), craps, pai gow poker, Caribbean stud poker and roulette)
as well as poker were available to the casino's patrons. The
current facility also includes a specialty restaurant, a 500-seat
buffet, a snack bar, three cocktail lounges and two service bars.
In late 1996, the Company commenced construction of a
hotel tower at Circus Circus-Tunica which will include 1,200
rooms. In addition to the construction of the hotel tower, which
is expected to open in December 1997, the existing facilities at
Circus Circus-Tunica will be remodeled and rethemed into a more
elegant resort which will be operated under the name Gold Strike
Casino Resort. The estimated cost of the hotel tower and related
improvements is $125 million.
The Company's Tunica site is a part of a three-casino
development covering approximately 72 acres. The other two
casinos are owned and operated by unaffiliated third parties.
The Company also has an undivided one-half interest in an
additional 388 acres of land contiguous to or near each of the
three casino sites which may be used for future development.
Marketing
Generally, the Company follows a marketing and
operating philosophy which emphasizes high-volume business by
providing moderately priced hotel rooms, food and beverage and
alternative entertainment in combination with the gaming
activity. The Company also maintains stringent cost controls
which are exemplified by a general policy of offering minimal
credit for gaming customers at the Company's properties.
Management believes that this philosophy sets the Company apart
from its principal competitors.
The Company's current operations at each of its casinos
are conducted 24 hours a day, every day of the year. The Company
does not consider its business to be highly seasonal, although
its operating income is typically somewhat lower in the fourth
quarter. Management emphasizes courteous and prompt service to
its customers and aspires to a high standard of excellence in all
of its operations.
The Company believes it has been able to maintain high
occupancy rates at its hotels, in part, due to the modest prices
charged for its rooms and its advertised policy of assisting any
customer who cannot be accommodated at its properties in finding
similarly priced rooms in nearby hotels and motels. For the
years ended January 31, 1997, 1996 and 1995, the combined
occupancy rate of the Company s hotels (excluding complimentaries
but including nonrefunded prepaid cancellations, and including
each hotel acquired by the Company during such three-year period
only for the portion of such period commencing with such
acquisition) was approximately 93.2%, 93.5% and 95.7%,
respectively.
Circus Circus-Las Vegas and Circus Circus-Reno, which
together contributed 24% of the Company's revenues in the year
ended January 31, 1997 (and 27% and 29%, respectively, in the
years ended January 31, 1996 and 1995), have popular buffets,
attractive because of their variety, quality and low price. From
a "Big Top" above the casino, both properties offer a variety of
circus acts performed free of charge to the public from 11 a.m.
to midnight daily. A mezzanine area overlooking each casino has
a circus midway with carnival-style games and an arcade that
offers a variety of amusements and electronic games. Grand Slam
Canyon, an adventuredome, offers additional theme park
attractions at Circus Circus-Las Vegas.
Excalibur, which contributed 23% of the Company's
revenues in the year ended January 31, 1997 (and 23% and 25%,
respectively, in the years ended January 31, 1996 and 1995),
attracts customers in the same manner as the Company's two
circus-themed Nevada properties by offering quality rooms, food
and entertainment at moderate prices. By way of entertainment,
the medieval castle-themed Excalibur offers a medieval village,
an amphitheater where mock tournaments and costume drama are
presented, dynamic motion theaters, various artisans' booths and
medieval games of skill.
Luxor contributed 17% of the Company's revenues in the
year ended January 31, 1997 (and 20% and 24%, respectively, in
the years ended January 31, 1996 and 1995). This property, which
has been expanded with the addition of 1,950 hotel rooms in two
22-story towers which opened a majority of their rooms in
December 1996 and the remainder by February 1997, offers a level
of entertainment and hotel accommodations which is designed to
attract the higher income segment of the middle-income strata of
gaming customers. Designed with an Egyptian theme, Luxor s 30-
story pyramid offers its guests a tri-level entertainment area
which includes IMAX special-format filmed attractions designed to
seemingly transport visitors to extraordinary places of times
past, present and future. In addition to the new hotel rooms,
the Luxor expansion program includes a new spa, 20,000 square
feet of convention space and ultimately will include a new multi-
purpose showroom.
The Colorado Belle and Edgewater together contributed
12% of the Company's revenues in the year ended January 31, 1997
(and 13% and 16%, respectively, in the years ended January 31,
1996 and 1995). Forming the heart of the Laughlin "Strip", the
Colorado Belle and the Edgewater combine to offer approximately
2,700 rooms and 108,000 square feet of casino space. The
Colorado Belle offers a classic Mississippi riverboat theme,
complete with a 60-foot paddle wheel. The Edgewater's
southwestern motif provides a relaxing atmosphere to enjoy the
property's casino and other facilities. Connected by a scenic
walkway, the two resorts form an inviting shoreline along the
Colorado River.
Gold Strike and Nevada Landing, which were acquired on
June 1, 1995, together contributed 6% and 4% of the Company's
revenues in the years ended January 31, 1997 and 1996,
respectively. The two properties are located on opposite sides
of I-15, the primary thoroughfare between Las Vegas and southern
California, approximately 25 miles south of Las Vegas and 12
miles north of the California/Nevada border. The properties are
conveniently located at the only highway interchange within 12
miles in either direction and are strategically positioned to
attract visitors from the large number of people traveling to and
from Las Vegas.
Circus Circus-Tunica, the Company's first wholly owned
casino outside of Nevada, opened in August 1994 and contributed
4% of the Company's revenues in the year ended January 31, 1997
(and 5% and 3% respectively, in the years ended January 31, 1996
and 1995). The facility, a dockside casino, is part of an
integrated three casino development that provides patrons with
the opportunity to visit any of the three casinos without
driving, a unique experience in the Tunica market. The Company
is constructing a 1,200-room hotel tower at Circus Circus-Tunica
which currently has no hotel facilities. The existing facilities
will also be remodeled and rethemed into a more elegant resort
which will be operated under the name Gold Strike Casino Resort.
The current expansion program is in response to increased
competition in the Tunica market being encountered from three new
competitors, including a new facility which is nearer to Memphis,
Tennessee (Tunica s principal market) and larger than any
previously existing facility in Tunica.
The Company maintains an active media advertising
program through radio, television, billboards and printed
publications primarily in Nevada, California and Arizona for its
Nevada properties and in the Memphis area for Circus Circus-
Tunica. In addition, the Company advertises and allows patrons
to make room reservations using the internet. While the Company
offers complimentary hotel accommodations, meals and drinks to
its customers on an individual basis, no group complimentary
arrangements are offered.
Operations
The primary source of revenues to the Company is its
casinos, although the hotels, restaurants, bars, shops, midway
games and other entertainment attractions and other services are
an important adjunct to the casinos.
The following table sets forth the contribution to net
revenues on a dollar and percentage basis of the Company's major
activities for each of the three most recent fiscal years.
Year Ended January 31,
1997 1996 1995
(Dollars in thousands)
Revenues:(1)
Casino(2) . . . . . $ 655,902 49.2% $664,772 51.2% $612,115 52.3%
Rooms(3). . . . . . 294,241 22.0% 278,807 21.4% 232,346 19.9%
Food and
beverage(3). . . . 210,384 15.8% 201,385 15.5% 189,664 16.2%
Other(3). . . . . . 146,554 11.0% 158,534 12.2% 166,295 14.2%
Earnings of unconsoli-
dated affiliates 86,646 6.5% 45,485 3.5% 5,459 .5%
$1,393,727 104.5% $1,348,983 103.8% $1,205,879 103.1%
Less:
Complimentary
allowances(3) . . 59,477 4.5% 49,387 3.8% 35,697 3.1%
Net revenues. . . . . $1,334,250 100.0% $1,299,596 100.0% $1,170,182 100.0%
(1) Includes operations of Gold Strike, Nevada Landing and Railroad Pass
since June 1, 1995 and Hacienda from September 1, 1995 to December 1,
1996.
(2) Casino revenues are the net difference between the sums received as
winnings and the sums paid as losses.
(3) Food and beverage, Rooms and Other include the retail value of services
which are provided to casino customers and others on a complimentary
basis. Such amounts are then deducted as complimentary allowances to
arrive at net revenue.
In connection with its gaming activities, the Company
follows a policy of stringent controls and cross checks on the
recording of all receipts and disbursements. The audit and cash
controls developed and utilized by the Company include the
following: locked cash boxes, independent counters, checkers and
observers to perform the daily cash and coin counts, floor
observation of the gaming areas, closed-circuit television
observation of certain areas, computer tabulation of receipts and
disbursements for each of the Company's slot machines, tables and
other games, and the rapid analysis and resolution of
discrepancies or deviations from normal performance.
The Company's credit policies are stringent and credit
play historically has accounted for an insignificant portion of
its gaming activities. Because of the Company's policies, its
casino receivables have been significantly less than 1% of its
total assets and its annual casino bad debt expense has been less
than 2/10 of 1% of casino revenues.
Joint Venture Participations
The Company is a 50% participant in three joint
ventures. They include (i) the Las Vegas Joint Venture, which
owns and operates Monte Carlo, a 3,002-room hotel-casino resort
on the Las Vegas Strip which opened in June 1996; (ii) the Elgin
Joint Venture, which owns and operates a riverboat casino and
land-based entertainment complex in Elgin, Illinois; and (iii)
the Reno Joint Venture, which owns and operates a hotel-casino in
Reno, Nevada. In January 1997, the Company disposed of its
one-third interest in a company which operates an interim casino
in Windsor, Ontario, Canada.
Las Vegas Joint Venture (50% Participation)
The Company, through a wholly owned entity (the Circus
Participant ), is a 50% participant with an affiliate of Mirage
Resorts, Incorporated ( Mirage ) in the Las Vegas Joint Venture,
a Nevada general partnership, which owns and operates Monte
Carlo, a hotel-casino resort with 3,002 hotel rooms, including
253 suites, situated on approximately 46 acres with approximately
600 feet of frontage on the Las Vegas Strip. Monte Carlo, which
opened in June 1996, is situated on a portion of the former
"Dunes" golf course between the site where Mirage is constructing
Bellagio, a 3,000-room luxury resort which is scheduled to open
in the summer of 1998 and will be connected to Monte Carlo by a
monorail, and New York-New York, a 2,000-room hotel-casino resort
which opened in January 1997. Monte Carlo features a 90,000
square foot casino with a palatial style reminiscent of the Belle
Epoque, the French Victorian architecture of the late 19th
century. As of January 31, 1997, Monte Carlo s casino had 2,221
slot machines and other coin operated devices and 95 gaming
tables (including blackjack ( 21 ), craps, pai gow poker,
Caribbean stud poker, roulette and baccarat) as well as keno,
bingo and a race and sports book. A recreated Victorian town
square features ornate facades, interactive games, high-tech
arcade rides and other nongaming recreational activities. Other
amenities at Monte Carlo include a 550-seat bingo parlor, three
specialty restaurants, a buffet, a coffee shop, a food court, a
microbrewery featuring live entertainment and approximately
15,000 square feet of meeting and banquet space. A 1,200-seat
replica of a plush vaudeville theater, including a balcony and
proscenium arch, features an elaborately staged show of illusions
with the world-renowned magician, Lance Burton.
As of January 31, 1997, the assets of the Las Vegas
Joint Venture were subject to encumbrances securing the repayment
of indebtedness in the aggregate principal amount of $184.8
million.
Elgin Joint Venture (50% Participation)
The Company, through a wholly owned entity, is a 50%
participant with an affiliate of Hyatt Development Corporation in the
Elgin Joint Venture, an Illinois general partnership which owns and
operates The Grand Victoria. The Grand Victoria, a Victorian themed
riverboat casino and land-based entertainment complex, opened in
October 1994 in Elgin, Illinois, a suburb approximately 40 miles
northwest of downtown Chicago. The Grand Victoria, the largest
cruising gaming vessel in the United States, offers a Las Vegas-style
gaming experience. The two-story vessel is 420 feet in length and 110
feet in width, and provides a maximum 80,000 square feet of gaming
space, approximately 36,000 square feet of which was being used at
January 31, 1997. As of such date, the casino had 977 slot machines
and other coin operated devices and 56 gaming tables (including
blackjack ( 21 ), craps, pai gow poker, Caribbean stud poker and
roulette). The vessel has a capacity of 1,736 persons and operates on
a fixed cruising schedule consisting of eight cruises each Sunday
through Thursday and nine cruises each Friday and Saturday. The
dimensions of the specially designed riverboat allow The Grand
Victoria to maximize the gaming positions permitted under existing
Illinois gaming regulations. This feature also allows The Grand
Victoria to significantly increase the number of on-board gaming
positions and to adapt the vessel to provide for dockside gaming in
the event of liberalized gaming regulations in the State of Illinois.
An adjacent dockside complex on approximately 12 acres of land
overlooking the Fox River contains an approximately 83,000-square-foot
pavilion with two movie theaters, a 240-seat buffet, an 80-seat fine
dining restaurant, a VIP lounge and a gift shop, in addition to
ticketing and registration services for the riverboat. There is
surface parking available for approximately 600 vehicles and a parking
structure which accommodates approximately 1,400 vehicles. The Grand
Victoria is strategically located in Elgin among the residential
suburbs of Chicago, with nearby freeway access and direct train
service from downtown Chicago. The Grand Victoria is located
approximately 20 miles and 40 miles, respectively, from its nearest
competitors in Aurora, Illinois and Joliet, Illinois, and holds one of
only ten riverboat gaming licenses currently granted state-wide.
After the Elgin Joint Venture s recovery of its $112 million
initial investment in The Grand Victoria (which occurred in June
1996), it became obligated to contribute 20% of its after-tax adjusted
net operating income to various local educational, environmental and
economic projects benefitting the City of Elgin and Kane County,
Illinois.
The pavilion and parking lot are located on land leased by
the Elgin Joint Venture from the City of Elgin for an initial period
of ten years, subject to certain renewal and purchase options granted
to the Elgin Joint Venture. Under the lease, the Elgin Joint
Venture's rent will be equal to the greater of the base rent ($110,000
per year) or 3% of its net operating income. The Elgin Joint Venture
may offset certain capital expenditures against this rental
obligation. Further, rent is deductible from after-tax adjusted net
operating income for purposes of calculating the 20% contribution
obligation described above. Until October 1999, the Elgin Joint
Venture is also obligated to make certain payments to the City of
Elgin to help defray law enforcement costs.
Under its agreements with the City of Elgin, the Elgin Joint
Venture also was granted an option to purchase an additional nine
acres of land contiguous to the existing site. For information
concerning certain regulatory requirements applicable to the ownership
and operation of the Elgin Joint Venture's gaming facilities, see
"Regulation and Licensing--Illinois" in this Item 1.
As of January 31, 1997, the assets of the Elgin Joint
Venture were not subject to any encumbrances securing the repayment of
indebtedness.
Reno Joint Venture (50% Participation)
The Company, through a wholly owned subsidiary, is a 50%
participant with Eldorado Limited Liability Company ("Eldorado
Limited") in the Reno Joint Venture, a general partnership which owns
and operates Silver Legacy, a hotel-casino and entertainment complex
situated on two city blocks in downtown Reno, Nevada. The casino and
entertainment complex, which opened in July 1995, is located between
Circus Circus-Reno and Eldorado Hotel & Casino (the "Eldorado"), which
is owned and operated by an affiliate of Eldorado Limited. Silver
Legacy's casino and entertainment complex is connected at the
mezzanine level with Circus Circus-Reno and the Eldorado by enclosed
climate-controlled skyways above the streets between the respective
properties. The property's exterior is themed to evoke images of Reno
during the period from the 1880's through the 1930's. At the main
pedestrian entrances to the casino (located on all four sides of the
complex), patrons enter by passing store fronts reminiscent of turn-
of-the-century Reno.
Silver Legacy, which has 1,711 hotel rooms, includes a total
of approximately 85,000 square feet of gaming space, a portion of
which is on the ground level and the balance of which is on the
property s mezzanine level. As of January 31, 1997, Silver Legacy s
casino had 2,275 slot machines and other coin operated devices and 89
gaming tables (including blackjack ("21"), craps, pai gow poker,
Caribbean stud poker, roulette, mini-baccarat and pai gow). Extending
up into a 180-foot diameter dome structure from the center of the
casino floor is a 120-foot tall mining rig situated over a replica of
a silver mine. A delicatessen, bar and "sidewalk" cafe are located on
the ground floor, and a seafood grill, a buffet and a 24-hour coffee
shop are located on the casino s mezzanine level. The Silver Legacy s
other amenities include a 25,000-square foot special events center,
three custom retail shops, a health spa and an outdoor pool and sun
deck. The hotel complex also includes a ten-level parking structure
with space for approximately 1,800 vehicles.
As of January 31, 1997, the assets of the Reno Joint
Venture, including Silver Legacy, were subject to encumbrances
securing the repayment of indebtedness (including certain indebtedness
to the Company) in the principal amount of $242.5 million.
Current Expansion Activities
Consistent with past practice and the longstanding policy of
making substantial investments in its gaming business at regular
intervals, the Company continues to actively pursue new projects,
either by development or acquisition. New investments may involve the
expansion of existing facilities (such as the recently added
facilities at Luxor and Circus Circus-Las Vegas) or new properties
such as Project Paradise. Projects may be undertaken in Nevada, where
all but one of the Company's wholly owned operating properties are
currently located, or in other jurisdictions within the United States
or abroad where gaming has been legalized. The Company s new
investments may be in properties wholly owned and operated by the
Company, or may be in properties developed, owned and/or operated
through joint ventures involving the Company and one or more other
parties.
The Company believes that its financial resources are
adequate to permit it to successfully meet its commitments with
respect to its current expansion projects and joint venture
participations. However, depending on the timing, size and nature of
the Company's commitments with respect thereto, future expansion
projects or joint venture participations may require the Company to
seek additional debt or equity funding.
As with any major construction project, Project Paradise and
the Company s Tunica County, Mississippi expansion project involve
(and any other major construction project the Company may undertake
will involve) many risks, including potential shortages of materials
and labor, work stoppages, labor disputes, weather interference,
unforeseen engineering, environmental or geological problems and
unanticipated cost increases, any of which could give rise to delays
or cost overruns. Construction, equipment or staffing problems or
difficulties in obtaining any of the requisite licenses, permits,
allocations or authorizations from regulatory authorities could
increase the cost or delay the construction or opening of the
facilities or otherwise affect their design and features. It is
possible that the existing budget and construction plans for either
project may be changed for competitive or other reasons. Accordingly,
there can be no assurance that either of the Company s current
construction projects will be completed within the time periods or
budgets which are currently contemplated.
Project Paradise
In the Spring of 1997, the Company commenced construction of
Project Paradise, a 42-story, hotel-casino resort which will have
approximately 3,800 rooms. The resort, which is expected to be
completed in late 1998 or early 1999, will resemble a fictional
tropical island and feature as its centerpiece a 10-acre tropical
environment that will contain, among other attractions, a surfing
beach with six-foot waves and a swim-up shark exhibit. Inside,
Project Paradise will offer waterfalls, terraced gardens, mythical
statuary and open-air restaurants set amid beautifully crafted
environments, including a swan island. The development will also
eventually be complimented by a 400-room Four Seasons Hotel that will
be connected to the Paradise complex, providing Las Vegas visitors
with a luxury hospitality experience. This hotel, which will be owned
by the Company and managed by Four Seasons Regent Hotels and Resorts,
represents the first step pursuant to the Company s cooperative effort
with Four Seasons to identify strategic opportunities for development
of hotel and casino properties worldwide. The cost of Project
Paradise is currently estimated at approximately $800 million,
excluding the land and the Four Seasons Hotel.
Project Paradise is the latest phase of the Company s
development of over 230 acres of land it owns at the south end of the
Las Vegas Strip which runs from Tropicana Avenue south approximately
one mile to Russell Road. Situated immediately to the south of Luxor
at approximately the mid-point of the Masterplan Mile, Project
Paradise will eventually be connected by an internal road and transit
system with Luxor and Excalibur as well as any other resorts the
Company may develop along its Masterplan Mile.
Tunica Expansion Project
The Company has commenced construction of a hotel tower at
Circus Circus-Tunica which will have 1,200 hotel rooms. The Company
will also remodel and retheme the existing facilities into a more
elegant resort which will be operated under the name Gold Strike
Casino Resort. The estimated cost of the hotel tower and the other
improvements, which are expected to be completed in December 1997, is
$125 million.
Mississippi Gulf Coast
The Company has announced that it plans to develop a hotel-
casino resort on the Mississippi Gulf Coast at the north end of the
Bay of St. Louis, near the DeLisle exit on Interstate 10, provided it
receives all of the requisite approvals. As planned, the resort will
feature 1,500 hotel rooms, and has an estimated cost of $225 million.
As presently contemplated, the Company will own 90% of the resort,
with a partner contributing the land in exchange for the remaining 10%
interest.
Atlantic City
The Company has entered into an agreement with Mirage to
participate in the development of a 150-acre site located in the
Marina District of Atlantic City (the Marina District Site ). The
agreement provides for the Company to obtain from Mirage a sufficient
portion of the Marina District Site for the development of a
destination resort and casino with approximately 2,000 hotel rooms.
Mirage and the City of Atlantic City have entered into a redevelopment
agreement (the Redevelopment Agreement ) providing for the City to
convey the Marina District Site to Mirage in exchange for Mirage s
agreeing to develop a casino-based destination resort on the site and
undertaking certain other obligations, including remediation of
environmental contamination and the relocation of City-owned
facilities currently located on the site. Closing under the
Redevelopment Agreement requires the satisfaction of a number of
conditions, including the receipt by Mirage of all requisite licenses,
permits, allocations and authorizations, resolution of real estate
title issues and the satisfactory conclusion of arrangements among
Mirage, the New Jersey Department of Transportation and South Jersey
Transportation Authority with respect to the construction and joint
funding of certain major road improvements to improve access to the
Marina District Site. Selection of a contractor to design and build
the road improvements will be determined by public bidding, and
construction of the improvements will not proceed unless one or more
bids within the available budget are submitted. Accordingly, there
can be no assurance as to whether or when Mirage will proceed with a
project on the Marina District Site. The Company s participation in
the development of a portion of the Marina District Site is dependent
on Mirage s proceeding with development of the site. If Mirage
proceeds with such development, it will act as master-developer for
the entire Marina District Site, but the Company will acquire and own
the portion of the site on which its resort will be constructed. The
Company s resort will be in an architectural format that conforms to a
masterplan and will be connected to Mirage s resort as well as to a
joint venture resort to be developed on a portion of the Marina
District Site by Boyd Gaming Corporation and Mirage. The Company s
ability to proceed with its development of a resort on the Marina
District Site is subject, in addition to Mirage s proceeding with
development of the site, to the Company s obtaining the requisite
gaming and other approvals and licenses in New Jersey, as well as the
approval of the gaming authorities of various other jurisdictions.
While neither the exact extent of a potential development nor a
starting date for construction can be determined at this time, the
Company is currently contemplating an investment of $600-$700 million
to construct this hotel-casino megaresort.
Competition
Recognizing that middle class vacationers enjoy gaming, but
also vacation with their families, the Company seeks to appeal to this
value-oriented market and satisfy the group's diverse entertainment
demands by offering exciting entertainment opportunities at reasonable
prices. The Company seeks to achieve this objective by offering
gaming combined with dramatic entertainment concepts and reasonably
priced rooms, reasonably priced food and beverage and prompt,
courteous service at its entertainment "megastores", such as the
Circus properties in Las Vegas and Reno, Luxor and Excalibur in Las
Vegas and the Colorado Belle and Edgewater in Laughlin.
The Company's largest concentration of properties is in Las
Vegas where, as of January 31, 1997, the Company was the largest
hotel-casino operator in terms of total square footage of casino space
and number of hotel rooms. The Company s Las Vegas casino and hotel
operations, which are conducted from facilities located along the
Las Vegas Strip, currently compete with approximately 28 major hotel-
casinos and a number of smaller casinos located on or near the
Las Vegas Strip. Such operations also compete with casinos located
in downtown Las Vegas, approximately 11 of which offer hotel, food and
beverage and entertainment facilities, and several major hotel-casinos
located elsewhere in the Las Vegas area. The Company's Las Vegas
properties also compete, to a lesser extent, with casino and hotel
facilities in other parts of Nevada, including Laughlin, Reno and
along I-15 (the principal means of access to Las Vegas from southern
California by car) near the California-Nevada state line.
The casino and hotel capacity continues to increase in the
Las Vegas market. During the fiscal year ended January 31, 1997, two
major hotel-casinos, including the 3,002-room Monte Carlo in which the
Company owns a 50% interest, opened near the south end of the Las
Vegas Strip which, together with a third opening at the north end of
the Strip and the completion of a number of expansion projects,
including the new 1,000-room tower at Circus Circus-Las Vegas and the
1,950-room expansion at Luxor, contributed to a net increase in the
number of hotel rooms in the Las Vegas market in fiscal 1997 of
approximately 11,000, representing an increase of approximately 12%
over the period. The development in Las Vegas in recent years has
shifted the focus of the Strip toward its south end, where the
Company s two newest Las Vegas properties, Luxor and Excalibur, and
the Las Vegas Joint Venture s new property, Monte Carlo, are situated
and where the Company is currently developing Project Paradise.
Operating income for the year ended January 31, 1997 declined at
Circus Circus-Las Vegas, the Company s other large Las Vegas property
located at the north end of the Strip, compared with the property s
results for the prior fiscal year. Due to significant disruption at
Circus Circus-Las Vegas during most of fiscal 1997 caused by the
construction, it is difficult to determine the impact, if any, on
operations at Circus Circus-Las Vegas of the growth of casino and
hotel capacity in Las Vegas or the shift in development toward the
south end of the Strip.
Las Vegas room and casino capacity is expected to continue
to increase significantly during the next several years as a result of
the opening of several new hotel-casinos, including Project Paradise,
and the completion of a number of announced expansion projects at
existing properties. While the impact on the Company of the
completion and opening of additional hotel and casino capacity
currently under construction in Las Vegas, including Project Paradise,
cannot be determined at this time, management believes that the
Company's Las Vegas operations, on a consolidated basis, have
generally benefited from the past growth of hotel and casino capacity
in the Las Vegas market when the Company has been a significant
contributor to the new capacity, as it will be with respect to the
added capacity that will result from the projects currently under
construction.
Excalibur and Luxor, each historically has benefited from
walk-in business attributable to the registered guests and casino
customers at the other property. During the year ended January 31,
1997, an additional 1,950 rooms were added at Luxor and in March 1997
a new climate-controlled skyway connecting Luxor and Excalibur was
placed in service, which should increase the flow of walk-in business
each property derives from the registered guest and casino customers
of the other property.
Circus Circus-Reno competes with approximately 13 major
casinos (the majority of which offer hotel rooms), including Silver
Legacy, a 1,711-room hotel-casino complex which opened in July 1995
and is 50% owned by a wholly owned subsidiary of the Company. Circus
Circus-Reno and Silver Legacy also compete with numerous other smaller
casinos in the greater Reno area and, to a lesser extent, with casino
and hotel facilities in Lake Tahoe and other parts of Nevada. Silver
Legacy, situated between Circus Circus-Reno and the Eldorado, is
connected to each of such properties at the mezzanine level by
enclosed climate-controlled skyways above the streets between the
respective properties, thus facilitating the flow of customers within
the three properties. Since the opening of Silver Legacy, results at
Circus Circus-Reno have been affected as guests staying at Circus
Circus-Reno have chosen to visit Silver Legacy during their stay.
In Laughlin, the Colorado Belle and the Edgewater, which
together accounted for approximately 24% of the rooms in Laughlin as
of January 31, 1997, compete with eight other Laughlin casinos. They
also compete with the hotel-casinos in Las Vegas and those situated on
I-15 (the principal highway between Las Vegas and Los Angeles) near
the California-Nevada state line, as well as a growing number of
casinos on Indian reservations in Laughlin's regional market. While
the Colorado Belle and the Edgewater also compete with each other,
both properties have maintained occupancy levels of above 85% at their
hotels and, because the two properties are situated on adjoining
sites, the Company believes that each property benefits from walk-in
business attributable to the registered guests and casino customers at
the other property. The Company believes the expansion of hotel and
casino capacity in Las Vegas over the last several years has had a
negative impact on Laughlin area properties, including the Colorado
Belle and the Edgewater, by drawing visitors from the Laughlin market,
which has resulted in increased competition among Laughlin properties
for a reduced number of visitors thus contributing to generally lower
revenues and profit margins at Laughlin properties, including the
Colorado Belle and the Edgewater.
The Company s Jean, Nevada properties, Gold Strike and
Nevada Landing, are located on I-15, the primary thoroughfare between
Las Vegas and southern California, approximately 25 miles south of
Las Vegas and 12 miles north of the California-Nevada border, and are
dependent for their customers almost entirely on the large number of
people traveling between Las Vegas and southern California. As such,
these properties compete with the large concentration of hotel, casino
and other entertainment options available in Las Vegas as well as
three hotel-casinos clustered at the California-Nevada border which,
according to published reports, offer over 2,000 rooms and over
100,000 square feet of casino space as well as restaurants and
entertainment facilities.
The Company believes that it receives the major portion of
its Las Vegas business from southern California and to a lesser degree
from the remainder of the southwestern United States. The major
portion of its Reno business is derived from northern California and
to a lesser degree from the northwestern United States. Laughlin's
business is derived principally from Arizona and southern California.
Circus Circus-Tunica competes with eight other casinos in
Tunica County, including Grand Casinos new hotel-casino which opened
in June 1996 at Buck Lake, directly north of Tunica, and which is
larger in capacity and situated closer to Memphis than any of the
other facilities currently in operation in Tunica County. In response
to the increased competition in the Tunica market, Circus Circus-
Tunica, which currently has no hotel, is being expanded by the
addition of a 1,200-room hotel tower. The existing facilities are
also being completely rethemed into a more elegant resort under the
name Gold Strike Casino Resort. The completion of the hotel tower
will give the Gold Strike Casino Resort the largest room base in the
Tunica market.
There is no limit on the number of licenses that may be
granted within Mississippi or within any county in Mississippi. The
Company believes that Circus Circus-Tunica's principal market is the
area within 100 miles of Tunica County. This area includes Memphis,
Tennessee, Little Rock, Arkansas and northern Mississippi. Tunica
County is currently the closest legalized gaming jurisdiction to
Memphis. Because Circus Circus-Tunica is heavily dependent upon the
patronage of Memphis residents and upon tourists and other out-of-
state gaming customers coming to Tunica from Memphis, the opening of
gaming casinos at locations closer to Memphis can have a material
adverse effect on Circus Circus-Tunica's operations. In this regard,
management believes the opening of the Grand Casino property at Buck
Lake, approximately one mile north of Circus Circus-Tunica, was a
significant contributor to the decrease in operating results at Circus
Circus-Tunica during the prior fiscal year. De Soto County, the
northwestern most Mississippi county and the nearest to Memphis, by
local referendum in November 1996, voted (as it had in November 1992)
against authorizing gaming activities in the county, but could at any
time after October 2000 again vote on the question of allowing gaming
activities in the county. In addition, the authorization of gaming
activities in Arkansas or Tennessee (which currently has a
constitutional restriction on gaming activities) could have a material
adverse effect on the Company's Tunica County operations.
Gaming has expanded dramatically in the United States in
recent years. This growth has been reflected in various forms
including riverboats, dockside gaming facilities, Native American
gaming ventures, land-based casinos, state-sponsored lotteries, off-
track wagering and card parlors. Since 1990, when there were casinos
in only three states (excluding casinos on Native American lands),
gaming has spread to a number of additional states and still other
states are currently considering the legalization of casino gaming in
specific geographic areas within their jurisdictions. Casino gaming
is currently conducted by numerous Native American tribes throughout
the United States and other Native American tribes are either in the
process of establishing or are considering the establishment of gaming
at additional locations, including sites in California and Arizona.
Other than the aforementioned impact on its Laughlin operations of
native American gaming in Laughlin's regional gaming market, the
Company does not believe that gaming, as presently conducted in other
states, has had a material adverse impact on operations at the
properties where it currently conducts its gaming operations. The
competitive impact on Nevada gaming establishments, in general, and
the Company's operations, in particular, from the continued growth of
gaming in jurisdictions outside of Nevada cannot be determined at this
time. The Company believes that the expansion of casino gaming in
areas close to Nevada, such as California and Arizona, could have an
adverse impact on the Company's operations and, depending on the
nature, location and extent of such operations, such impact could be
material.
Regulation and Licensing
Nevada
The ownership and operation of casino gaming facilities in
Nevada are subject to: (i) the Nevada Gaming Control Act and the
regulations promulgated thereunder (collectively, the "Nevada Act");
and (ii) various local ordinances and regulations. The Company's
gaming operations are subject to the licensing and regulatory control
of the Nevada Gaming Commission (the "Nevada Commission"), the Nevada
State Gaming Control Board (the "Nevada Board"), and various local
licensing and regulatory authorities, including the Clark County
Liquor and Gaming Licensing Board, the City of Reno and the City of
Henderson (collectively, the "Local Authorities"). The Nevada
Commission, the Nevada Board and the Local Authorities are
collectively referred to as the "Nevada Gaming Authorities".
The laws, regulations and supervisory procedures of the
Nevada Gaming Authorities are based upon declarations of public policy
which are concerned with, among other things: (i) the prevention of
unsavory or unsuitable persons from having a direct or indirect
involvement with gaming at any time or in any capacity; (ii) the
establishment and maintenance of responsible accounting practices and
procedures; (iii) the maintenance of effective controls over the
financial practices of licensees, including the establishment of
minimum procedures for internal fiscal affairs and the safeguarding of
assets and revenues, providing reliable record keeping and requiring
the filing of periodic reports with the Nevada Gaming Authorities;
(iv) the prevention of cheating and fraudulent practices; and (v)
providing a source of state and local revenues through taxation and
licensing fees. Changes in such laws, regulations and procedures
could have an adverse effect on the Company's gaming operations.
The Company's direct and indirect subsidiaries that conduct
gaming operations or have an ownership interest in an entity that
conducts gaming operations are required to be licensed by the Nevada
Gaming Authorities. The Company is registered by the Nevada
Commission as a publicly traded corporation (a "Registered
Corporation") and has been found suitable to own the stock of Circus
Circus Casinos, Inc., Slots-A-Fun, Inc., Edgewater Hotel Corporation,
Colorado Belle Corp., New Castle Corp. and Ramparts, Inc., each of
which is a corporate gaming licensee under the terms of the Nevada Act
( individually, a "Corporate Licensee" and collectively with the
additional corporate subsidiaries referenced hereinbelow, the
"Corporate Licensees") that has been licensed to conduct nonrestricted
gaming operations at its respective gaming establishment. The Company
has also been found suitable to own the stock of M.S.E. Investments,
Incorporated ("M.S.E."), Last Chance Investments, Inc. ("LCI"),
Goldstrike Investments, Inc. ("GII"), Diamond Gold, Inc. ("DGI"),
Oasis Development Company, Inc. ("Oasis") and Galleon, Inc.
("Galleon"), each of which is a Corporate Licensee that has been
licensed as a general partner of one or more Nevada general
partnerships that have been licensed to conduct nonrestricted or
restricted gaming operations at their respective gaming
establishments. M.S.E., LCI and GII are each licensed as general
partners of Railroad Pass Investment Group, a Nevada general
partnership ("Railroad Pass"), Jean Development Company, a Nevada
general partnership ("Jean Development"), Jean Development West, a
Nevada general partnership ("Jean West"), Gold Strike Fuel Company, a
Nevada general partnership ("GSFC") and Jean Fuel Company West, a
Nevada general partnership ("Jean Fuel") and Gold Strike L.V., a
Nevada general partnership ("GSLV"); DGI is licensed as a general
partner of GSLV and Jean West; Oasis is licensed as a general partner
of GSFC and Jean Fuel; and Galleon is licensed as a 50% general
partner of Circus and Eldorado Joint Venture, a Nevada general
partnership ("CEJV") which operates the Silver Legacy and GSLV is
licensed as a 50% general partner of Victoria Partners, a Nevada
general partnership ("Victoria Partners") which operates Monte Carlo
(all such general partnerships individually, a "Partnership Licensee"
and collectively, the "Partnership Licensees"). Railroad Pass, Jean
Development, Jean West, CEJV and Victoria Partners have each been
licensed to conduct nonrestricted gaming operations at their
respective gaming establishments and Jean Fuel and GSFC have each been
licensed to conduct restricted gaming operations consisting of 15 or
fewer slot machines at their respective gaming establishments.
The gaming licenses held by the Corporate Licensees and the
Partnership Licensees (each individually, a "Gaming Subsidiary" and
collectively, the "Gaming Subsidiaries") to conduct nonrestricted
gaming operations require the payment of periodic fees and taxes and
are not transferable. As a Registered Corporation, the Company is
required periodically to submit detailed financial and operating
reports to the Nevada Commission and furnish any other information
which the Nevada Commission may require. No person may become a
stockholder or partner of, or receive any percentage of profits from
the Gaming Subsidiaries without first obtaining licenses and approvals
from the Nevada Gaming Authorities. The Company and the Gaming
Subsidiaries have obtained from the Nevada Gaming Authorities the
various registrations, approvals, findings of suitability permits and
licenses required in order to engage in gaming activities in Nevada.
The Nevada Gaming Authorities may investigate any individual
who has a material relationship to, or material involvement with, the
Company or the Gaming Subsidiaries in order to determine whether such
individual is suitable or should be licensed as a business associate
of a gaming licensee. Officers, directors and certain key employees
of the Gaming Subsidiaries must file applications with the Nevada
Gaming Authorities and may be required to be licensed or found
suitable by the Nevada Gaming Authorities. Officers, directors and
key employees of the Company who are actively and directly involved in
gaming activities of the Gaming Subsidiaries may be required to be
licensed or found suitable by the Nevada Gaming Authorities. The
Nevada Gaming Authorities may deny an application for licensing for
any cause which they deem reasonable. A finding of suitability is
comparable to licensing, and both require submission of detailed
personal and financial information followed by a thorough
investigation. The applicant for licensing or a finding of
suitability must pay all the costs of the investigation. Changes in
licensed positions must be reported to the Nevada Gaming Authorities
and in addition to their authority to deny an application for a
finding of suitability or licensure, the Nevada Gaming Authorities
have jurisdiction to disapprove a change in a corporate position.
If the Nevada Gaming Authorities were to find an officer,
director or key employee unsuitable for licensing or unsuitable to
continue having a relationship with the Company or a Gaming
Subsidiary, the companies involved would have to sever all
relationships with such person. In addition, the Nevada Commission
may require the Company and the Gaming Subsidiaries to terminate the
employment of any person who refuses to file appropriate applications.
Determinations of suitability or of questions pertaining to licensing
are not subject to judicial review in Nevada.
The Company and the Gaming Subsidiaries are required to
submit detailed financial and operating reports to the Nevada
Commission. Substantially all material loans, leases, sales of
securities and similar financing transactions by the Gaming
Subsidiaries must be reported to or approved by the Nevada Commission.
If it were determined that the Nevada Act was violated by a
Gaming Subsidiary, the gaming licenses it holds could be limited,
conditioned, suspended or revoked, subject to compliance with certain
statutory and regulatory procedures. In addition, the Gaming
Subsidiaries, the Company and the persons involved could be subject to
substantial fines for each separate violation of the Nevada Act at the
discretion of the Nevada Commission. Further, a supervisor could be
appointed by the Nevada Commission to operate the Company's gaming
properties and, under certain circumstances, earnings generated during
the supervisor's appointment (except for reasonable rental value of
the casino) could be forfeited to the State of Nevada. Limitation,
conditioning or suspension of any gaming license or the appointment of
a supervisor could (and revocation of any gaming license would)
materially adversely affect the Company's gaming operations.
Any beneficial holder of the Company's voting securities,
regardless of the number of shares owned, may be required to file an
application, be investigated, and have his suitability as a beneficial
holder of the Company's voting securities determined if the Nevada
Commission has reason to believe that such ownership would otherwise
be inconsistent with the declared policies of the state of Nevada.
The applicant must pay all costs of investigation incurred by the
Nevada Gaming Authorities in conducting any such investigation.
The Nevada Act requires any person who acquires more than
five percent of a Registered Corporation's voting securities to report
the acquisition to the Nevada Commission. The Nevada Act requires
that beneficial owners of more than 10% of a Registered Corporation's
voting securities apply to the Nevada Commission for a finding of
suitability within thirty days after the Chairman of the Nevada Board
mails the written notice requiring such filing. Under certain
circumstances, an "institutional investor", as defined in the Nevada
Act, which acquires more than 10%, but not more than 15%, of the
Registered Corporation's voting securities may apply to the Nevada
Commission for a waiver of such finding of suitability if such
institutional investor holds the voting securities for investment
purposes only. An institutional investor shall not be deemed to hold
voting securities for investment purposes unless the voting securities
were acquired and are held in the ordinary course of business as an
institutional investor and not for the purpose of causing, directly or
indirectly, the election of a majority of the members of the board of
directors of the Company, any change in the Company's corporate
charter, bylaws, management, policies or operations of the Registered
Corporation, or any of its gaming affiliates, or any other action
which the Nevada Commission finds to be inconsistent with holding the
Registered Corporation's voting securities for investment purposes
only. Activities which are not deemed to be inconsistent with holding
voting securities for investment purposes only include: (i) voting on
all matters voted on by stockholders; (ii) making financial and other
inquiries of management of the type normally made by securities
analysts for informational purposes and not to cause a change in its
management, policies or operations; and (iii) such other activities as
the Nevada Commission may determine to be consistent with such
investment intent. If the beneficial holder of voting securities who
must be found suitable is a corporation, partnership or trust, it must
submit detailed business and financial information including a list of
beneficial owners. The applicant is required to pay all costs of
investigation.
Any person who fails or refuses to apply for a finding of
suitability or a license within 30 days after being ordered to do so
by the Nevada Commission or the Chairman of the Nevada Board, may be
found unsuitable. The same restrictions apply to a record owner if
the record owner, after request, fails to identify the beneficial
owner. Any stockholder found unsuitable and who holds, directly or
indirectly, any beneficial ownership of the Company's voting
securities beyond such period of time as may be prescribed by the
Nevada Commission may be guilty of a criminal offense. The Company is
subject to disciplinary action if, after it receives notice that a
person is unsuitable to be a stockholder or to have any other
relationship with the Company or the Gaming Subsidiaries, the Company:
(i) pays that person any dividend or interest upon voting securities
of the Company; (ii) allows that person to exercise, directly or
indirectly, any voting right conferred through securities held by that
person; (iii) pays remuneration in any form to that person for
services rendered or otherwise; or (iv) fails to pursue all lawful
efforts to require such unsuitable person to relinquish his voting
securities including, if necessary, the immediate purchase of said
voting securities for cash at fair market value. Additionally, the
Clark County Liquor and Gaming Licensing Board has the authority to
approve all persons owning or controlling the stock of any corporation
controlling a gaming licensee.
The Nevada Commission may, in its discretion, require the
holder of any debt security of a Registered Corporation to file
applications, be investigated and be found suitable to own the debt
security of a Registered Corporation if the Nevada Commission has
reason to believe that such holder's acquisition of such debt security
would otherwise be inconsistent with the declared policy of the State
of Nevada. If the Nevada Commission determines that a person is
unsuitable to own such security, then pursuant to the Nevada Act, the
Registered Corporation can be sanctioned, including the loss of its
approvals, if without the prior approval of the Nevada Commission, it:
(i) pays to the unsuitable person any dividend, interest, or any
distribution whatsoever; (ii) recognizes any voting right by such
unsuitable person in connection with such securities; (iii) pays the
unsuitable person remuneration in any form; or (iv) makes any payment
to the unsuitable person by way of principal, redemption, conversion,
exchange, liquidation or similar transaction.
The Company is required to maintain a current stock ledger
in Nevada which may be examined by the Nevada Gaming Authorities at
any time. If any securities are held in trust by an agent or by a
nominee, the record holder may be required to disclose the identity of
the beneficial owner to the Nevada Gaming Authorities. A failure to
make such disclosure may be grounds for finding the record holder
unsuitable. The Company is also required to render maximum assistance
in determining the identity of the beneficial owner. The Nevada
Commission has the power to require the Company's stock certificates
to bear a legend indicating that the securities are subject to the
Nevada Act. However, to date, the Nevada Commission has not imposed
such a requirement on the Company.
The Company may not make a public offering of its securities
without the prior approval of the Nevada Commission if the securities
or proceeds therefrom are intended to be used to construct, acquire or
finance gaming facilities in Nevada, or to retire or extend
obligations incurred for such purposes. On June 19, 1996, the Nevada
Commission granted the Company prior approval to make public offerings
for a period of one year, subject to certain conditions (the "Shelf
Approval"). The Shelf Approval also applies to any affiliated company
wholly owned by the Company (an "Affiliate") which is a publicly
traded corporation or would thereby become a publicly traded
corporation pursuant to a public offering. The Shelf Approval also
includes approval for the Corporate Licensees to guarantee any
security issued by, or to hypothecate their assets to secure the
payment or performance of any obligations issued by, the Company or an
Affiliate in a public offering under the Shelf Registration. However,
the Shelf Approval may be rescinded for good cause without prior
notice upon the issuance of an interlocutory stop order by the
Chairman of the Nevada Board and must be renewed annually. The Shelf
Approval does not constitute a finding, recommendation or approval by
the Nevada Commission or the Nevada Board as to the accuracy or
adequacy of the prospectus or the investment merits of the securities
offered. Any representation to the contrary is unlawful.
Changes in control of the Company through merger,
consolidation, stock or asset acquisitions, management or consulting
agreements, or any act or conduct by a person whereby he obtains
control, may not occur without the prior approval of the Nevada
Commission. Entities seeking to acquire control of a Registered
Corporation must satisfy the Nevada Board and Nevada Commission in a
variety of stringent standards prior to assuming control of such
Registered Corporation. The Nevada Commission may also require
controlling stockholders, officers, directors and other persons having
a material relationship or involvement with the entity proposing to
acquire control, to be investigated and licensed as part of the
approval process relating to the transaction.
The Nevada legislature has declared that some corporate
acquisitions opposed by management, repurchases of voting securities
and corporate defense tactics affecting Nevada gaming corporate
licensees, and Registered Corporations that are affiliated with those
operations, may be injurious to stable and productive corporate
gaming. The Nevada Commission has established a regulatory scheme to
ameliorate the potentially adverse effects of these business practices
upon Nevada's gaming industry and to further Nevada's policy to: (i)
assure the financial stability of corporate gaming operators and their
affiliates; (ii) preserve the beneficial aspects of conducting
business in the corporate form; and (iii) promote a neutral
environment for the orderly governance of corporate affairs. Approvals
are, in certain circumstances, required from the Nevada Commission
before the Company can make exceptional repurchases of voting
securities above the current market price thereof and before a
corporate acquisition opposed by management can be consummated. The
Nevada Act also requires prior approval of a plan of recapitalization
proposed by the Company's Board of Directors in response to a tender
offer made directly to the Registered Corporation's stockholders for
the purposes of acquiring control of the Registered Corporation.
License fees and taxes, computed in various ways depending
on the type of gaming or activity involved, are payable to the State
of Nevada and to the counties and cities in which the Gaming
Subsidiaries' respective operations are conducted. Depending upon the
particular fee or tax involved, these fees and taxes are payable
either monthly, quarterly or annually and are based upon either: (i) a
percentage of the gross revenues received; (ii) the number of gaming
devices operated; or (iii) the number of gaming tables operated. A
casino entertainment tax is also paid by nonrestricted casino
operations where entertainment is furnished in connection with the
selling of food or refreshments and merchandise. Nevada licensees that
hold a license as an operator of a slot route, or a manufacturer's or
distributor's license, also pay certain fees and taxes to the State of
Nevada.
Any person who is licensed, required to be licensed,
registered, required to be registered, or is under common control with
such persons (collectively, the "Licensees"), and who proposes to
become involved in a gaming venture outside of Nevada, is required to
deposit with the Nevada Board, and thereafter maintain, a revolving
fund in the amount of $10,000 to pay the expenses of investigation by
the Nevada Board of their participation in such foreign gaming. The
revolving fund is subject to increase or decrease in the discretion of
the Nevada Commission. Thereafter, Licensees are required to comply
with certain reporting requirements imposed by the Nevada Act.
Licensees are also subject to disciplinary action by the Nevada
Commission if they knowingly violate any laws of the foreign
jurisdiction pertaining to the foreign gaming operation, fail to
conduct the foreign gaming operation in accordance with the standards
of honesty and integrity required of Nevada gaming operations, engage
in activities that are harmful to the state of Nevada or its ability
to collect gaming taxes and fees, or employ a person in the foreign
operation who has been denied a license or finding of suitability in
Nevada on the ground of personal unsuitability.
The sale of alcoholic beverages at the gaming establishments
operated by the Gaming Subsidiaries is subject to licensing, control
and regulation by the applicable Local Authorities. All licenses are
revocable and are not transferable. The Local Authorities involved
have full power to limit, condition, suspend or revoke any such
license, and any such disciplinary action could (and revocation would)
have a material adverse affect upon the operations of the licensed
gaming establishments.
Mississippi
The Company conducts its Mississippi gaming operations
through a Mississippi subsidiary, Circus Circus Mississippi, Inc.
("CCMI"). The ownership and operation of casino gaming facilities in
Mississippi are subject to extensive state and local regulation. In
order to open and operate Circus Circus-Tunica, the Company was
required to register under the Mississippi Gaming Control Act (the
"Mississippi Act") and its Mississippi gaming operations are subject
to the licensing and regulatory control of the Mississippi Gaming
Commission (the "Mississippi Commission") and various local and county
regulatory agencies. Effective October 29, 1991, the Mississippi
Commission adopted regulations in furtherance of the Mississippi Act
(the "regulations"). Changes in the Mississippi Act, the regulations
and/or interpretations of the Mississippi Act and the regulations by
the Mississippi Commission could have a material adverse effect on
gaming operations conducted by the Company in Mississippi.
The Company is required to submit detailed financial,
operating and other reports to the Mississippi Commission.
Substantially all loans, leases, sales of securities and similar
financing transactions entered into by CCMI must be reported to or
approved by the Mississippi Commission. CCMI also is required to
periodically submit detailed financial and operating reports to the
Mississippi Commission and the Mississippi State Tax Commission and to
furnish any other information required thereby.
Each of the directors, officers and key employees of the
Company who are actively and directly engaged in the administration or
supervision of gaming in Mississippi, or who have any other
significant direct or indirect involvement with the gaming activities
of the Company in Mississippi, must be found suitable therefor, and
may be required to be licensed, by the Mississippi Commission. The
finding of suitability is comparable to licensing, and both require
submission of detailed personal financial information followed by a
thorough investigation. In addition, any individual who is found to
have a material relationship to, or material involvement with, the
Company may be required to be investigated in order to be found
suitable or to be licensed as a business associate of the Company.
Key employees, controlling persons or others who exercise significant
influence upon the management or affairs of the Company may also be
deemed to have such a relationship or involvement. There can be no
assurance that a person who is subject to a finding of suitability
will be found suitable by the Mississippi Commission. An application
for licensing may be denied for any cause deemed reasonable by the
Mississippi Commission. Changes in licensed positions must be
reported to the Mississippi Commission. In addition to its authority
to deny an application for a license, the Mississippi Commission has
jurisdiction to disapprove a change in corporate position. If the
Mississippi Commission were to find a director, officer or key
employee unsuitable for licensing or unsuitable to continue having a
relationship with the Company, the Company would have to suspend,
dismiss and sever all relationships with such person in order to
continue to have any involvement in gaming in Mississippi. The
Company would have similar obligations with regard to any person who
should refuse to file appropriate applications. Each gaming employee
at a Mississippi gaming facility must obtain from the Mississippi
Commission a work permit which may be revoked upon the occurrence of
certain specified events.
Mississippi statutes and regulations give the Mississippi
Commission the discretion to require a suitability finding with
respect to anyone who acquires any security of the Company, regardless
of the percentage of ownership. The current policy of the Mississippi
Commission is to require anyone acquiring five percent or more of any
voting securities of a public or private company to be found suitable.
If the owner of voting securities who is required to be found suitable
is a corporation, partnership or trust, it must submit detailed
business and financial information including a list of beneficial
owners. The applicant is required to pay all costs of investigation
which the Company may reimburse. The Mississippi Commission has
selected those persons it feels were required to be investigated and
found suitable and has made the findings of suitability. However,
other persons, for the reasons set forth above, may be required to be
found suitable.
Any owner of voting securities found unsuitable and who
holds, directly or indirectly, any beneficial ownership of equity
interests in the Company beyond such period of time as may be
prescribed by the Mississippi Commission may be guilty of a
misdemeanor. Any person who fails or refuses to apply for a finding
of suitability or a license within 30 days after being ordered to do
so by the Mississippi Commission may be found unsuitable. The Company
will be subject to disciplinary action if, after it receives notice
that a person is unsuitable to be an owner of or to have any other
relationship with it, the Company: (i) pays the unsuitable person any
dividends or interest upon any securities of the gaming subsidiary or
any payments or distribution of any kind whatsoever; (ii) recognizes
the exercise, directly or indirectly, of any voting rights in its
securities by the unsuitable person; or (iii) pays the unsuitable
person any remuneration in any form for services rendered or
otherwise, except in certain limited and specific circumstances. In
addition, if the Mississippi Commission finds any owner of voting
securities unsuitable, such owner must immediately surrender all
securities to the Company, and the Company must refund any money or
other thing of value that may have been invested in the Company or
made use of by the Company.
The Company is required to maintain current equity ownership
ledgers in the State of Mississippi which may be examined by the
Mississippi Commission at any time. The Company obtained a waiver of
this ledger requirement from the Mississippi Commission at its
licensing hearing, however, the waiver may be revoked, modified or
suspended at any time by the Mississippi Commission in its discretion.
If any securities are held in trust by an agent or by a nominee, the
record holder may be required to disclose the identity of the
beneficial owner to the Mississippi Commission. A failure to make
such disclosure may be grounds for finding the record holder
unsuitable. The Company also is required to render maximum assistance
in determining the identity of such a beneficial owner.
The Mississippi Act requires that certificates representing
equity securities of the Company bear a legend to the general effect
that the securities are subject to the Mississippi Act and regulations
of the Mississippi Commission. The Company obtained a waiver of this
legend requirement from the Mississippi Commission, however, this
waiver may be revoked, modified or suspended by the Mississippi
Commission in its discretion at any time. The Mississippi Commission,
through the power to regulate licenses, has the power to impose
additional restrictions on the Company and on the holders of the
Company's securities at any time.
The Company may not make a public offering of its securities
without the prior approval of the Mississippi Commission if the
securities or proceeds therefrom are intended to be used to construct,
acquire or finance gaming facilities in Mississippi, or to retire or
extend obligations incurred for such purposes. On January 23, 1997,
the Mississippi Commission granted the Company prior approval to make
public offerings for a period of one year, subject to certain
conditions (the "Shelf Approval"). The Shelf Approval also applies to
any affiliated company wholly owned by the Company (an "Affiliate")
which is a publicly traded corporation or would thereby become a
publicly traded corporation pursuant to a public offering. The Shelf
Approval also included approval for CCMI to guarantee any security
issued by, or to hypothecate their assets to secure the payment or
performance of any obligations issued by the Company or an affiliate
in a public offering under the Shelf Registration. However, the Shelf
Approval may be rescinded for good cause without prior notice upon the
issuance of an interlocutory stop order by the Executive Director of
the Mississippi Commission and must be renewed annually. The Shelf
Approval does not constitute a finding, recommendation or approval by
the Mississippi Commission as to the accuracy or adequacy of the
prospectus or the investment merits of the securities offered. Any
representation to the contrary is unlawful.
The regulations provide that a change in control of the
Company may not occur without the prior approval of the Mississippi
Commission. Mississippi law prohibits the Company from making a
public offering of its securities without the approval of the
Mississippi Commission if any part of the proceeds of the offering is
to be used to finance the construction, acquisition or operation of
gaming facilities in Mississippi, or to retire or extend obligations
incurred for one or more of such purposes.
As long as the Company is licensed to conduct gaming in
Mississippi, the Company may not engage in gaming activities in
Mississippi while also conducting gaming operations outside of
Mississippi without approval of the Mississippi Commission. The
Company has been approved in the following jurisdictions; Nevada,
Indiana, Louisiana, Illinois and Ontario, Canada.
The Company received its Mississippi gaming license on
August 18, 1994 and its renewal on July 18, 1996. The gaming license
is not transferable and must be renewed every two years. The
Mississippi Commission in 1994 enacted an infrastructure development
regulation which requires that a Mississippi casino invest 25% of its
casino costs in infrastructure facilities. Infrastructure facilities
are defined in the regulation to include a hotel with at least 250
rooms, theme park, golf course and other similar facilities. When
completed, the planned expansion will meet the infrastructure
requirements. Each issuing agency may at any time dissolve, suspend,
condition, limit or restrict a license or approval to own equity
interests in the Company for any cause deemed reasonable by such
agency.
Substantial fines for each violation of gaming laws or
regulations may be levied against the Company in Mississippi. A
violation under any gaming license held by the Company may be deemed a
violation of its Mississippi license. Suspension or revocation of any
of the Company's gaming licenses or of the approval of the Company
would have a material adverse effect upon any business conducted by
the Company in Mississippi.
License fees and taxes, computed in various ways depending
on the type of gaming involved, are payable to the State of
Mississippi and to the county and cities in which the Company conducts
operations in Mississippi. Depending upon the particular fee or tax
involved, these fees and taxes are payable either weekly or annually
and are based upon: (i) the gross gaming revenues received by the
casino operation; (ii) the number of slot machines operated by the
casino; and (iii) the number of gaming tables operated by the casino.
The legal age for gaming in Mississippi is 21.
Illinois
The Company is subject to the jurisdiction of the Illinois
gaming authorities as a result of its acquisition of The Grand
Victoria riverboat casino and gaming complex based in Elgin, Illinois.
In 1990, the Riverboat Gambling Act (the "Illinois Act") was
enacted by the State of Illinois. The Illinois Act authorizes the
five-member Illinois Gaming Board (the "Illinois Board") to issue up
to ten owners licenses on navigable streams within or forming a
boundary of the State of Illinois except for Lake Michigan and any
waterway in Cook County, which includes Chicago. The Illinois Act
strictly regulates the facilities, persons, associations and practices
related to gaming operations pursuant to the police powers of the
State of Illinois, including comprehensive law enforcement
supervision. The Illinois Act grants the Illinois Board specific
powers and duties, and all other powers necessary and proper to fully
and effectively execute the Illinois Act for the purpose of
administering, regulating and enforcing the system of riverboat
gaming. The Illinois Board's jurisdiction extends to every person,
association, corporation, partnership and trust involved in riverboat
gaming operations in the State of Illinois.
The Illinois Act requires the owner of a riverboat gaming
operation to hold an owner's license issued by the Illinois Board.
Each owner's license permits the holder to own up to two riverboats,
however, gaming participants are limited to 1,200 for any owner's
license. A licensed owner who holds greater than 10% interest on one
riverboat operation, may hold up to 10% of a second riverboat gaming
operation in Illinois.
The Illinois Act restricts the granting of certain of the
ten owners' licenses by location. Four are for operators docking at
sites on the Mississippi River, one is for an operator docking at a
site on the Illinois River south of Marshall County and one is for an
operator docking at a site on the Des Plaines River in Will County.
The remaining four owner's licenses are not restricted as to location.
In addition to the ten owner's licenses which may be authorized under
the Illinois Act, the Illinois Board may issue special event licenses
allowing persons who are not otherwise licensed to conduct riverboat
gaming to conduct such gaming on a specified date or series of dates.
Riverboat gaming under such a license may take place on a riverboat
not normally used for riverboat gaming.
The gaming license issued to The Grand Victoria riverboat
casino in October 1994, will be valid for an initial period of three
years and must be renewed annually thereafter. An owner's license is
eligible for renewal upon payment of the applicable fee and a
determination by the Illinois Board that the licensee continues to
meet all of the requirements of the Illinois Act and Illinois Board
rules. An ownership interest in an owner's license, or in a business
entity other than a publicly held business entity which holds an
owner's license, may not be (i) transferred or (ii) pledged as
collateral without the approval of the Illinois Board. The Illinois
Board also requires that employees of a gaming operator and vendors of
gaming supplies and equipment be licensed.
The Illinois Act does not limit the maximum bet or per
patron loss. Licensees, however, may set any maximum or minimum
limits on wagering under the Illinois Act. No person under the age of
21 is permitted to wager.
An admission tax is imposed on the owner of a riverboat
operation at a rate of $2 per person admitted. Additionally, a
wagering tax is imposed on the adjusted gross receipts, as defined in
the Illinois Act, of a riverboat operation at the rate of 20%. The
licensee is required to wire the wagering tax payment to the Illinois
Board daily.
Under the Illinois Act, there is a four-hour maximum period
during which gaming may be conducted during a gaming excursion. Gaming
is deemed to commence when the first passenger boards a riverboat for
an excursion and may continue while other passengers are boarding for
a period not to exceed 30 minutes. A gaming excursion is deemed to
have started upon the commencement of gaming. Gaming may continue for
a period not to exceed 30 minutes after the gangplank or its
equivalent is lowered. During this 30-minute period of egress, new
passengers may not board a riverboat. Special event extended cruises
may be authorized by the Illinois Board.
If a riverboat captain reasonably determines that either it
is unsafe to transport passengers on the waterway due to inclement
weather or the riverboat has been rendered temporarily inoperable by
unforeseeable mechanical or structural difficulties or river icing,
the riverboat shall either not leave the dock or immediately return to
it. If a riverboat captain reasonably determines for reasons of
safety that although seaworthy, the riverboat should not leave the
dock or should return immediately thereto, due to either of the above
conditions, a gaming excursion may commence or continue while the
gangplank or its equivalent is raised and remains raised, in which
event the riverboat is not considered docked. If, due to either of
the above conditions, a gaming excursion must commence or continue
with the gangplank or its equivalent raised, and the riverboat does
not leave the dock, ingress is prohibited until the completion of the
excursion.
After consultation with the U.S. Army Corps of Engineers,
the Illinois Board may establish binding emergency orders upon the
concurrence of a majority regarding the navigability of rivers in the
event of extreme weather conditions, acts of God or their extreme
circumstances.
The Illinois Board is authorized to conduct investigations
into the conduct of gaming as it may deem necessary and proper and
into alleged violations of the Illinois Act and the Illinois Board
rules. Employees and agents of the Illinois Gaming Board have access
to and may inspect any facilities relating to the riverboat gaming
operations at all times.
A holder of any license is subject to imposition of fines,
suspension or revocation of such license, or other action for any act
or failure to act by himself or his agents or employees, that is
injurious to the public health, safety, morals, good order and general
welfare of the people of the State of Illinois, or that would
discredit or tend to discredit the Illinois gaming industry or the
State of Illinois. Any riverboat operations not conducted in
compliance with the Illinois Act may constitute an illegal gaming
place and consequently may be subject to criminal penalties, which
penalties include possible seizure, confiscation and destruction of
illegal gaming devices and seizure and sale of riverboats and dock
facilities to pay any unsatisfied judgment that may be recovered and
any unsatisfied fine that may be levied. The Illinois Act also
provides for civil penalties, equal to the amount of gross receipts
derived from wagering on the gaming, whether unauthorized or
authorized, conducted on the day of any violation. The Illinois Board
may revoke or suspend licenses, as the Illinois Board may see fit and
in compliance with applicable laws of the State of Illinois regarding
administrative procedures and may suspend an owner's license, without
notice or hearing, upon a determination that the safety or health of
patrons or employees is jeopardized by continuing a riverboat's
operation. The suspension may remain in effect until the Illinois
Board determines that the cause for suspension has been abated and it
may revoke the owner's license upon a determination that the owner has
not made satisfactory progress toward abating the hazard.
The Illinois Board requires that a "Key Person" of an owner
licensee submit a Personal Disclosure Form and be investigated and
approved by the Illinois Board. For a publicly-held Business Entity a
"Key Person" is any person directly or indirectly holding a legal or
beneficial interest of 5% or more of an applicant or licensee and/or
officers, directors, trustees, partners and managing agents of a
gaming enterprise, and any person identified by the Board as a person
able to control or exercise significant influence over the management
or operating policies of a licensee. Furthermore, each applicant for
an owner's license or owner licensee must disclose the identity of
every person, association, trust or corporation having a greater than
1% direct or indirect pecuniary interest in an owner licensee or in
the riverboat gaming operation with respect to which the license is
sought. The Illinois Board may also require an applicant or owner
licensee to disclose any other principal or investor and require the
investigation and approval of such individuals.
The Illinois Board (unless the investor qualifies as an
Institutional Investor) requires a Personal Disclosure Form from any
person or entity who or which, individually or in association with
others, acquires directly or indirectly, beneficial ownership of more
than 5% of any class of voting securities or nonvoting securities
convertible into voting securities of a publicly traded corporation
which holds an ownership interest in the holder of an owner's license.
If the Illinois Board denies an application for such a transfer and if
no hearing is requested, the applicant for the transfer of ownership
must promptly divest those shares in the publicly traded parent
corporation. The holder of an owner's license would not be able to
distribute profits to a publicly traded parent corporation until such
shares have been divested. If a hearing is requested, the shares need
not be divested and profits may be distributed to a publicly-held
parent corporation pending the issuance of a final order from the
Illinois Gaming Board.
An Institutional Investor that individually or jointly with
others, cumulatively acquires, directly or indirectly, 5% or more of
any class of voting securities of a publicly-traded licensee or a
licensee's publicly-traded parent corporation shall, within no less
than ten days after acquiring such securities, notify the
Administrator of the Board of such ownership and shall provide any
additional information as may be required. If an Institutional
Investor (as specified above) acquires 10% or more of any class of
voting securities of a publicly-traded licensee or a licensee's
publicly-traded parent corporation, it shall file an Institutional
Investor Disclosure Form within 45 days after acquiring such level of
ownership interest.
The Illinois Board may waive any licensing requirement or
procedure provided by rule if it determines that such waiver is in the
best interests of the public and the gaming industry. Also, the
Illinois Board may, from time to time, amend or change Board rules.
Uncertainty exists regarding the Illinois gambling
regulatory environment due to limited experience in interpreting the
Illinois Act.
From time to time, various proposals have been introduced in
the Illinois legislature that, if enacted, would affect the taxation,
regulation, operation or other aspects of the gaming industry or the
Company. Some of this legislation, if enacted, could adversely affect
the gaming industry or the Company. No assurance can be given whether
such or similar legislation will be enacted.
Applicants for and holders of an owner's license are
required to obtain formal approval from the Illinois Board for changes
in the following areas: (i) Key Persons; (ii) type of entity; (iii)
equity and debt capitalization of the entity; (iv) investors and/or
debt holders; (v) source of funds; (vi) applicant's economic
development plan; (vii) riverboat capacity or significant design
change; (viii) gaming positions, (ix) anticipated economic impact; or
(x) agreements, oral or written, relating to the acquisition or
disposition of property (real or personal) of a value greater than $1
million .
A holder of an owner's license is allowed to make
distributions to its stockholders only to the extent that such
distribution would not impair the financial viability of the gaming
operation. Factors to be considered by the licensee will include but
not be limited to the following: (i) cash flow, casino cash and
working capital requirements; (ii) debt service requirements
obligations and covenants associated with financial instruments; (iii)
requirements for repairs and maintenance and capital improvements; and
(iv) employment or economic development requirements of the Act; and
(v) a licensees financial projections.
Other Jurisdictions
As a result of the Company's efforts to expand its
operations into new jurisdictions, the Company is likely to become
subject to comprehensive gaming and other regulations in each such
jurisdiction into which its operations are expanded. Such regulations
may be similar to, and could be more restrictive than, those currently
applicable to the Company, its officers, directors or employees or
persons associated with the Company.
Employees and Labor Relations
At January 31, 1997, the Company employed approximately
20,000 persons. Approximately 39% of the Company's employees at
January 31, 1997 were employed pursuant to the terms of collective
bargaining agreements. The contracts with three unions, including the
largest union, expire in fiscal 1998. The Company does not anticipate
any difficulties in renewing such agreements. Management considers
its labor relations to be satisfactory. A work stoppage has not been
experienced at a Company-owned property since an industry-wide strike
in 1975.
Certain states in which gaming recently has been legalized
have established community commitment and similar laws which require
that a specified percentage of employees of gaming ventures be
residents of the state in which the gaming venture is located. These
laws could affect the ability of the Company to attract and retain
qualified employees for gaming operations conducted by the Company or
joint ventures in which it participates outside Nevada.
Certain Forward Looking Statements
Certain information included in this Report 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) contains or may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such
statements including information relating to current construction
activities, plans for future expansion and other business development
activities as well as other capital spending, financing sources and
the effects of regulation (including gaming and tax regulation) and
competition. Such forward-looking information involves important
risks and uncertainties that could significantly affect anticipated
results in the future and, accordingly, such results may differ from
those expressed in any forward-looking statements made by or on behalf
of the Company. These risks and uncertainties include, but are not
limited to, those relating to development and construction activities,
dependence on existing management, leverage and debt service
(including sensitivity to fluctuation in interest rates), domestic or
global economic conditions, changes in federal or state tax laws or
the administration of such laws, changes in gaming laws or regulations
(including the legalization of gaming in certain jurisdictions) and
applications for licenses and approvals under applicable laws and
regulations (including gaming laws and regulations).
ITEM 2. PROPERTIES.
Circus Circus-Las Vegas. The Company owns approximately 69
acres of land with 375 feet of frontage on the Las Vegas Strip and
Circus Circus-Las Vegas which is situated on the site. For additional
information concerning Circus Circus-Las Vegas, see "Description of
the Company's Operating Hotels and Casinos -- Las Vegas, Nevada
- -- Circus Circus-Las Vegas" in Item 1 of this Report.
Luxor and Excalibur. The Company owns a 117-acre parcel on
the southwest corner of the intersection of the Las Vegas Strip and
Tropicana Avenue, with approximately 2,400 feet of frontage on the Las
Vegas Strip and includes, Excalibur, which is situated on the northern
portion of the parcel at the intersection of the Las Vegas Strip and
Tropicana Avenue, and Luxor, which is situated on such site to the
south of Excalibur. For additional information concerning Luxor and
Excalibur, see "Description of the Company's Operating Hotels and
Casinos -- Las Vegas, Nevada -- Luxor" and -- Excalibur" in Item 1 of
this Report.
Circus Circus-Reno. Circus Circus-Reno is situated on a
three-block area in downtown Reno, of which approximately 90% is owned
by the Company and the remainder is held under three separate leases,
two of which expire in 2032 and 2033, respectively. The Company owns
the remaining interest in the parcel subject to the third lease
pursuant to which the Company is obligated to pay rent for the
lifetime of the landlord. For additional information concerning
Circus Circus-Reno, see "Description of the Company's Operating Hotels
and Casinos -- Reno, Nevada -- Circus Circus-Reno" in Item 1 of this
Report.
Colorado Belle. The Company owns approximately 22 acres on
the bank of the Colorado River in Laughlin, Nevada and the Colorado
Belle, which is situated on the site. For additional information
concerning the Colorado Belle Hotel and Casino, see "Description of
the Company's Operating Hotels and Casinos -- Laughlin, Nevada
- -- Colorado Belle" in Item 1 of this Report.
Edgewater. Adjacent to the site of the Colorado Belle, the
Company owns approximately 16 acres on the bank of the Colorado River
in Laughlin, Nevada, and the Edgewater Hotel and Casino, which is
situated on the site. For additional information concerning the
Edgewater Hotel and Casino, see "Description of the Company's
Operating Hotels and Casinos -- Laughlin, Nevada -- Edgewater" in Item
1 of this Report.
Gold Strike. The Company owns approximately 51 acres and
the Gold Strike Hotel & Gambling Hall, which is situated on the site,
located on the east side of I-15 in Jean, Nevada, approximately 12
miles from the California/Nevada border and 25 miles from Las Vegas.
For additional information concerning Gold Strike, see "Description of
the Company's Operating Hotels and Casinos - Jean, Nevada -- Gold
Strike" in Item 1 of this Report.
Nevada Landing. The Company owns approximately 55 acres and
the Nevada Landing Hotel & Casino, which is situated on the site,
located on the west side of I-15 in Jean, Nevada. For additional
information concerning Nevada Landing, see "Description of the
Company's Operating Hotels and Casinos - Jean, Nevada -- Nevada
Landing" in Item 1 of this Report.
Railroad Pass. The Company owns approximately 56 acres and
the Railroad Pass Hotel & Casino, which is situated on the site,
located on US-93 in Henderson, Nevada. For additional information
concerning Railroad Pass, see "Description of the Company's Operating
Hotels and Casino - Henderson, Nevada -- Railroad Pass" in Item 1 of
this Report.
Circus Circus-Tunica. The Company owns approximately 24
acres in Tunica County, Mississippi and Circus Circus-Tunica, which is
situated on the site. The Company also owns an undivided 50% interest
in an additional 388-acre site adjacent to the Circus Circus-Tunica
site which is owned jointly with another unaffiliated gaming company.
For additional information concerning Circus Circus-Tunica, see
"Description of the Company's Operating Hotels and Casinos -- Tunica
County, Mississippi -- Circus Circus-Tunica" in Item 1 of this Report.
Other Real Property
Slots-A-Fun is situated on a 30,000-square-foot parcel owned
by the Company and has approximately 100 feet of frontage on the Las
Vegas Strip.
The Company operates the Silver City Casino in Las Vegas
under a lease which expires in October 1999. The Company currently
pays a base rent of $129,982 per month. The base rent is subject to
annual increases, calculated by using a specified index with a cap
based on a specified percentage of annual revenues. Under the terms
of the lease, the landlord or the landlord's assignee is entitled to
participate in the profits to the extent of 50% of defined income from
the operation of the Silver City Casino. There was no profit
participation rent due for the years ended January 31, 1995, 1996 or
1997.
The Company owns approximately 47 acres formerly the site of
the Hacienda Hotel and Casino which was imploded on December 31, 1996
to make way for the construction of Project Paradise which is
currently being built on the site. For additional information
concerning Project Paradise, see Current Expansion Activities in
Item 1.
The Company owns approximately 73 acres of unimproved land
located immediately south of the aforementioned 47-acre site and
approximately 15 acres of land on the Las Vegas Strip across from
Luxor which from time to time is utilized as a parking lot for
employees at Luxor and Excalibur.
The Company owns 60 acres of land in Jean, Nevada to the
north of Gold Strike and approximately 89 acres of land in Sloan,
Nevada off of I-15. Sloan is located between Jean and Las Vegas.
Reference is made to Current Expansion Activities for a
discussion of the Company s agreement with Mirage Resorts Incorporated
relating to the Company s possible acquisition of unimproved land in
Atlantic City, New Jersey and the development of a hotel and casino on
a portion of such site. The Company also owns or leases, or has
options and/or agreements to purchase or lease, certain other improved
and unimproved properties which are not deemed to be material to the
Company.
As of January 31, 1997, the aforementioned properties owned
by the Company were not subject to any encumbrances securing the
repayment of indebtedness.
Joint Venture Interests. The Company, either directly or
through wholly owned subsidiaries, owns (i) a 50% interest in the Las
Vegas Joint Venture, which owns and operates Monte Carlo, a 3,002-room
hotel-casino complex which opened in June 1996: (ii) a 50% interest in
the Elgin Joint Venture, which owns and operates The Grand Victoria, a
riverboat casino and land-based entertainment complex in Elgin,
Illinois; and (iii) a 50% interest in the Reno Joint Venture, which
owns and operates Silver Legacy, a 1,711-room hotel-casino in Reno,
Nevada. Reference is made to the information appearing under the
caption Joint Venture Participations in Item 1 of this Report
concerning the properties owned and operated by the aforementioned
joint venture entities, which information is hereby incorporated in
this Item 2 by this reference.
ITEM 3. LEGAL PROCEEDINGS.
On April 26, 1994, a lawsuit requesting class certification,
was filed in the United States District Court for the Middle District
of Florida against 41 manufacturers, distributors and casino operators
of video poker and electronic slot machines, including the Company.
On May 10, 1994, a lawsuit requesting class certification alleging
substantially identical claims was filed by another plaintiff in the
same court against 48 defendants, including the Company. The two
lawsuits were consolidated into a single action and transferred to the
United States District Court for the District of Nevada (the Court ).
On September 26, 1995, a lawsuit requesting class certification
alleging substantially identical claims was filed by a third plaintiff
in the Court against 45 defendants, including the Company. On
February 14, 1997, the three plaintiffs filed a consolidated amended
complaint in the Court. The complaints allege that the defendants
have engaged in a course of fraudulent and misleading conduct intended
to induce persons to play video poker and electronic slot machines
based on a false belief concerning how the gaming machines operate, as
well as the extent to which there is an opportunity to win. The
complaint alleges violations of the Racketeer Influenced and Corrupt
Organizations Act, as well as claims of common law fraud, unjust
enrichment and negligent misrepresentation, and seeks unspecified
compensatory and punitive damages. The Company and other defendants
have moved to dismiss the complaint for failure to state a claim. It
is anticipated that there will be no ruling on the Company s motion to
dismiss until the summer of 1997. Management believes that the claims
against the Company are without merit and intends to defend the case
vigorously.
An amended complaint in a purported class action lawsuit was
filed on August 23, 1995 in the United States District Court for the
District of New Jersey, Camden Division, against 79 named defendants,
including the Company and other casino operators. The complaint, filed
on behalf of Thomas Hyland and other persons similarly situated,
alleged that the defendants had engaged in a course of conduct
involving conspiracy among casinos in the United States to refuse to
deal to skilled blackjack players who are capable of winning money at
the casinos blackjack tables in violation of various statutory
provisions including the Sherman Act, the Fair Credit Reporting Act
and various state antitrust and consumer fraud laws. The complaint,
which also asserted causes of action under state tort and contract
laws and sought recovery of compensatory and exemplary damages, was
dismissed and the time permitted to appeal such decision has expired.
The Company is a defendant in various other pending law
suits. In management's opinion, the ultimate outcome of such law
suits will not have a material adverse effect on the results of
operations or the financial position of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted to a vote of the Company's
security holders during the fourth quarter of the fiscal year
ended January 31, 1997.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
Price Range of Common Stock. The Company's Common
Stock is listed on the New York Stock Exchange and on the Pacific
Stock Exchange and traded under the symbol CIR. The following
table sets forth, for the fiscal quarters shown, the low and high
sale prices for the Common Stock on the New York Stock Exchange
Composite Tape.
Fiscal 1997 Low High
First Quarter......................$30.00 $37.88
Second Quarter.....................$29.88 $44.38
Third Quarter......................$30.13 $35.88
Fourth Quarter.....................$32.25 $37.25
Fiscal 1996 Low High
First Quarter......................$24.38 $33.50
Second Quarter.....................$29.25 $36.13
Third Quarter......................$24.75 $33.63
Fourth Quarter.....................$25.25 $31.88
On April 18, 1997 there were 4,180 holders of record of the
Common Stock of the Company.
Dividend Policy. The Company does not currently pay a
cash dividend, nor is one contemplated in the foreseeable future.
The Company believes that currently its stockholders are best
served by a policy of reinvestment in new high-return projects.
The Company has a policy of periodic share repurchase, as cash
flows, borrowing capacity and market conditions warrant.
ITEM 6. SELECTED FINANCIAL DATA.
Year ended January 31,
(amounts in thousands,
except share data) 1997 1996 1995 1994 1993
Operating Results(1):
Revenues(2) $1,334,250 $1,299,596 $1,170,182 $963,470 $850,941
Operating profit
before corporate
expense (3) 307,175 328,422 280,792 234,311 220,435
Pretax income 163,863 205,759 214,490 182,608 183,313
Net income before
nonrecurring
items(3) 135,774 161,645 138,244 126,918 120,983
Net income 100,733 128,898 136,286 116,189 117,322
Earnings per share
before nonrecurring
items (3)(4) $ 1.33 $1.66 $1.61 $1.46 $1.41
Earnings per share(4) $ .99 $1.33 $1.59 $1.34 $1.37
Balance Sheet Data:
Total assets $2,729,111 $2,213,503 $1,512,548 $1,297,924 $950,458
Long-term debt 1,405,897 715,214 632,652 567,345 308,092
Stockholders' equity 971,791 1,226,812 686,124 559,950 490,009
(1) Gold Strike, Nevada Landing and Railroad Pass were acquired on June 1,
1995. The Hacienda was acquired on September 1, 1995 and closed on
December 1, 1996. Circus Circus-Tunica opened in August 1994. Luxor
opened in October 1993.
(2) Revenues are net of complimentary allowances.
(3) These amounts are before extraordinary items and one-time charges in
fiscal year 1997 for the write-off of certain assets of $48,309 and
Monte Carlo preopening expenses of $5,614; in fiscal 1996 for the
write-off of certain assets of $45,148 and Silver Legacy preopening
expenses of $5,232; in fiscal 1995 for Circus Circus-Tunica preopening
expenses of $3,012; and in fiscal 1994 for Luxor and Grand Slam Canyon
preopening expenses of $16,506. In fiscal 1993, the Company
experienced an extraordinary loss of $3,661, net of income tax benefit
of $1,885, on the early retirement of $100,000 principal amount of the
Company's 10-1/8% Senior Subordinated Notes.
(4) Earnings per share are based on shares outstanding adjusted for a
three-for-two stock split effective July 9, 1993.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Incorporated herein by reference are pages 25 through 37 of
the Company's Annual Report to Stockholders for the fiscal year
ended January 31, 1997 (the "1997 Annual Report"), which pages
are included as part of Exhibit 13 to this Report.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Incorporated herein by reference are pages 38 through 54 of
the 1997 Annual Report which pages are included as part of
Exhibit 13 to this Report.
SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Year Ended January 31, 1997
(in thousands, except per share amounts)
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
Revenue $352,885 $338,806 $337,990 $304,569 $1,334,250
Income from operations 81,297 24,650 71,185 45,037 222,169
Income before income tax 69,385 12,881 55,659 25,938 163,863
Net income 43,472 7,309 34,813 15,139 100,733
Earnings per share $ .42 $ .07 $ .34 $ .16 $ .99
Year Ended January 31, 1996
(in thousands, except per share amounts)
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
Revenue $295,033 $326,766 $354,206 $323,591 $1,299,596
Income from operations 71,046 24,365 88,399 67,563 251,373
Income before income tax 61,367 12,885 76,187 55,320 205,759
Net income 39,400 7,281 46,584 35,633 128,898
Earnings per share $ 0.46 $ 0.08 $ 0.45 $ 0.35 $ 1.33
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information beginning immediately following the caption
"Election of Directors" to, but not including, the caption
"Management Remuneration" in the Company's Proxy Statement, to be
filed with the Securities and Exchange Commission within 120 days
after the close of the Company's fiscal year ended January 31,
1997 and forwarded to stockholders prior to the Company's 1997
Annual Meeting of Stockholders (the "1997 Proxy Statement"), is
incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION.
The information in the 1997 Proxy Statement beginning
immediately following the caption "Management Remuneration" to,
but not including, the caption "Report of the Compensation
Committee on Executive Compensation", is incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The information in the 1997 Proxy Statement beginning
immediately following the caption "Security Ownership of Certain
Beneficial Owners and Management" to, but not including, the
caption "Election of Directors", is incorporated herein by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information in the 1997 Proxy Statement beginning
immediately following the caption "Certain Transactions" to, but
not including, the caption "Approval of Amendments to the
Company's 1989 and 1993 Stock Option Plans and 1991 Stock
Incentive Plan" and the additional information in the 1997 Proxy
Statement beginning immediately following the caption
"Compensation Committee Interlocks and Insider Participation" to,
but not including, the caption "Comparative Stock Price
Performance Graph", is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a)(1) Consolidated Financial Statements:
CIRCUS CIRCUS ENTERPRISES, INC. AND SUBSIDIARIES Page
Consolidated Balance Sheets as of January 31, 1997 and
1996................................................... *
Consolidated Statements of Income for the three years
ended January 31, 1997................................. *
Consolidated Statements of Cash Flows for the three
years ended January 31, 1997........................... *
Consolidated Statements of Stockholders' Equity for
the three years ended January 31, 1997................. *
Notes to Consolidated Financial Statements............. *
Report of Independent Public Accountants............... *
(a)(2) Supplemental Financial Statement Schedules:
None.
* Refers to page of the Annual Report to Shareholders for the
year ended January 31, 1997, a copy of the incorporated
portions of which are included as Exhibit 13 to this Report.
(a)(3) Exhibits:
The following exhibits are filed as a part of this Report or
incorporated herein by reference:
3(i)(a). Restated Articles of Incorporation of the Company as of
July 15, 1988 and Certificate of Amendment thereto,
dated June 29, 1989. (Incorporated by reference to
Exhibit 3(a) to the Company's Annual Report on Form
10-K for the fiscal year ended January 31, 1991.)
3(i)(b). Certificate of Division of Shares into Smaller
Denominations, dated June 20, 1991. (Incorporated by
reference to Exhibit 3(b) to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1992.)
3(i)(c). Certificate of Division of Shares into Smaller
Denominations, dated June 22, 1993. (Incorporated by
reference to Exhibit 3(i) to the Company's Current
Report on Form 8-K dated July 21, 1993.)
3(ii). Restated Bylaws of the Company dated November 30, 1996.
4(a). Rights Agreement dated as of July 14, 1994, between the
Company and First Chicago Trust Company of New York.
(Incorporated by reference to Exhibit 4 to the
Company's Current Report on Form 8-K dated August 15,
1994.)
4(b). Amendment to Rights Agreement effective as of April 16,
1996, between the Company and First Chicago Trust
Company of New York. (Incorporated by reference to
Exhibit 4(a) to the Company s Quarterly Report on
Form 10-Q for the quarterly period ended July 31,
1996.)
4(c). $1.5 Billion Loan Agreement, dated as of January 29,
1996, by and among the Company, the Banks named therein
and Bank of America National Trust and Savings
Association, as administrative agent for the Banks, and
related Subsidiary Guaranty dated as of January 29,
1996, of the Company's subsidiaries named therein.
(Incorporated by reference to Exhibit 4(a) to the
Company's Current Report on Form 8-K dated January 29,
1996.)
4(d). Amendment No. 1 to the $1.5 Billion Loan Agreement, by
and among the Company, the Banks named therein and Bank
of America National Trust and Savings Association, as
administrative agent for the Banks. (Incorporated by
reference to Exhibit 4(c) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
4(e). Amendment No. 2 to the $1.5 Billion Loan Agreement, by
and among the Company, the Banks named therein and Bank
of America National Trust and Savings Association, as
administrative agent for the Banks. (Incorporated by
reference to Exhibit 4(a) to the Company s Quarterly
Report on Form 10-Q for the period ended October 31,
1996.)
4(f). Amendment No. 3 to the $1.5 Billion Loan Agreement, by
and among the Company, the Banks named therein and Bank
of America National Trust and Savings Association, as
administrative agent for the Banks. (Incorporated by
reference to Exhibit 4(b) to the Company s Quarterly
Report on Form 10-Q for the period ended October 31,
1996.)
4(g). Amendment No. 4 to the $1.5 Billion Loan Agreement, by
and among the Company, the Banks named therein and
Wells Fargo Bank, N.A., as administrative agent.
4(h). Rate Swap Master Agreement, dated as of October 24,
1986, and Rate Swap Supplements One through Four.
(Incorporated by reference to Exhibit 4(j) to the
Company's Current Report on Form 8-K dated December 29,
1986.)
4(i). Interest Rate Swap Agreement, dated as of October 20,
1989, by and between the Company and Salomon Brothers
Holding Company Inc. (Incorporated by reference to
Exhibit 4(q) to the Company's Annual Report on Form
10-K for the fiscal year ended January 31, 1990.)
4(j). Indenture by and between the Company and First
Interstate Bank of Nevada, N.A., as Trustee with
respect to the Company's 10-5/8% Senior Subordinated
Notes due 1997. (Incorporated by reference to Exhibit
4(a) to the Company's Registration Statement (No. 33-
34439) on Form S-3.)
4(k). Indenture by and between the Company and First
Interstate Bank of Nevada, N.A., as Trustee with
respect to the Company's 6-3/4% Senior Subordinated
Notes due 2003 and its 7-5/8% Senior Subordinated
Debentures due 2013. (Incorporated by reference to
Exhibit 4(a) to the Company's Current Report on Form
8-K dated July 21, 1993.)
4(l). Indenture, dated February 1, 1996, by and between the
Company and First Interstate Bank of Nevada, N.A., as
Trustee. (Incorporated by reference to Exhibit 4(b) to
the Company's Current Report on Form 8-K dated
January 29, 1996.)
4(m). Supplemental Indenture, dated February 1, 1996, by and
between the Company and First Interstate Bank of
Nevada, N.A., as Trustee, with respect to the Company's
6.45% Senior Notes due February 1, 2006. (Incorporated
by reference to Exhibit 4(c) to the Company's Current
Report on Form 8-K dated January 29, 1996.)
4(n). 6.45% Senior Notes due February 1, 2006 in the
principal amount of $200,000,000. (Incorporated by
reference to Exhibit 4(d) to the Company's Current
Report on Form 8-K dated January 29, 1996.)
4(o). Supplemental Indenture, dated as of November 15, 1996,
to an indenture dated February 1, 1996, by and between
the Company and Wells Fargo Bank (Colorado), N.A., as
Trustee, with respect to the Company s 6.70% Senior
Notes due November 15, 2096. (Incorporated by
reference to Exhibit 4(c) to the Company s Quarterly
Report on Form 10-Q for the quarterly period ended
October 31, 1996.)
4(p). 6.70% Senior Notes due February 15, 2096 in the
principal amount of $150,000,000. (Incorporated by
reference to Exhibit 4(d) to the Company's Quarterly
Report on Form 10-Q for the quarterly period ended
October 31, 1996.)
4(q). Indenture, dated November 15, 1996, by and between the
Company and Wells Fargo Bank (Colorado), N.A., as
Trustee. (Incorporated by reference to Exhibit 4(e) to
the Company's Quarterly Report on Form 10-Q for the
quarterly period ended October 31, 1996.)
4(r). Supplemental Indenture, dated as of November 15, 1996,
to an indenture dated November 15, 1996, by and between
the Company and Wells Fargo Bank (Colorado), N.A., as
Trustee, with respect to the Company s 7.0% Senior
Notes due November 15, 2036. (Incorporated by
reference to Exhibit 4(f) to the Company s Quarterly
Report on Form 10-Q for the quarterly period ended
October 31, 1996.)
4(s). 7.0% Senior Notes due February 15, 2036, in the
principal amount of $150,000,000. (Incorporated by
reference to Exhibit 4(g) to the Company s Quarterly
Report on Form 10-Q for the quarterly period ended
October 31, 1996.)
10(a).* 1983 Nonqualified Stock Option Plan of the Company.
(Incorporated by reference to Exhibit 10(d) to the
Company's Registration Statement (No. 2-85794) on
Form S-1.)
10(b).* 1983 Incentive Stock Option Plan of the Company.
(Incorporated by reference to Exhibit 10(e) to the
Company's Registration Statement (No. 2-85794) on
Form S-1.)
10(c).* Amendment to Circus Circus Enterprises, Inc. 1983
Incentive Stock Option Plan. (Incorporated by
reference to Exhibit 4(a) to the Company's Registration
Statement (No. 2-91950) on Form S-8.)
10(d).* Amended and Restated 1989 Stock Option Plan of the
Company, dated April 25, 1997.
10(e).* Stock Purchase Warrant Plan. (Incorporated by
reference to Exhibit 4(a) to the Company's Registration
Statement (No. 33-29014) on Form S-8.)
10(f).* Amended and Restated 1991 Stock Incentive Plan of the
Company, dated April 25, 1997.
10(g).* Amended and Restated 1993 Stock Option Plan of the
Company, dated April 25, 1997.
10(h).* 1995 Special Stock Option Plan and Forms of
Nonqualified Stock Option Certificate and Agreement.
(Incorporated by reference to Exhibit 10(gg) to the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1995.)
10(i).* Circus Circus Enterprises, Inc. Executive Compensation
Insurance Plan. (Incorporated by reference to Exhibit
10(i) to the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1992.)
10(j). Lease, dated November 1, 1957, by and between Bethel
Palma and others, as lessor, and the Company's
predecessor in interest, as lessee; Amendment of Lease,
dated May 6, 1983. (Incorporated by reference to
Exhibit 10(g) to the Company's Registration Statement
(No. 2-85794) on Form S-1.)
10(k). Grant, Bargain and Sale Deed to the Company pursuant to
the Lease dated November 1, 1957. (Incorporated by
reference to Exhibit 10(h) to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1984.)
10(l). Lease, dated August 3, 1977, by and between B&D
Properties, Inc., as lessor, and the Company, as
lessee; Amendment of Lease, dated May 6, 1983.
(Incorporated by reference to Exhibit 10(h) to the
Company's Registration Statement (No. 2-85794) on Form
S-1.)
10(m). Tenth Amendment and Restatement of the Circus Circus
Employees' Profit Sharing and Investment Plan.
(Incorporated by reference to Exhibit 4(e) to Post
Effective Amendment No. 7 to the Company's Registration
Statement (No. 33-18278) on Form S-8.)
10(n). Fifth Amendment and Restatement to Circus Circus
Employees' Profit Sharing and Investment Trust.
(Incorporated by reference to Exhibit 4(h) to Post
Effective Amendment No. 7 to the Company's Registration
Statement (No. 33-18278) on Form S-8.)
10(o).* Retirement Plan for Outside Directors (Incorporated by
reference to Exhibit 10(ii) to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1995).
10(p). Group Annuity Contract No. GA70867 between Philadelphia
Life (formerly Bankers Life Company) and Trustees of
Circus Circus Employees' Profit Sharing and Investment
Plan. (Incorporated by reference to Exhibit 4(c) to
the Company's Registration Statement (No. 33-1459) on
Form S-8.)
10(q). Lease, dated as of November 1, 1981, between Novus
Property Company, as landlord, and the Company, as
tenant. (Incorporated by reference to Exhibit 4(h) to
the Company's Registration Statement (No. 2-85794) on
Form S-1.)
10(r). First Addendum and First Amendment, each dated as of
June 15, 1983, to Lease dated as of November 1, 1981.
(Incorporated by reference to Exhibit 4(i) to the
Company's Annual Report on Form 10-K for the year ended
January 31, 1984.)
10(s). Second Amendment, dated as of April 1, 1984, to Lease
dated as of November l, 1981. (Incorporated by
reference to Exhibit 10(o) to the Company's
Registration Statement (No. 33-4475) on Form S-1.)
10(t). Lease by and between Robert Lewis Uccelli, guardian, as
lessor, and Nevada Greens, a limited partnership,
William N. Pennington, as trustee, and William G.
Bennett, as trustee, and related Assignment of Lease.
(Incorporated by reference to Exhibit 10(p) to the
Company's Registration Statement (No. 33-4475) on
Form S-1.)
10(u). Agreement of Purchase, dated March 15, 1985, by and
between Denio Brothers Trucking Company, as seller, and
the Company, as buyer, and related lease by and between
Denio Brothers Trucking Co., as lessor, and Nevada
Greens, a limited partnership, William N. Pennington,
as trustee, and William G. Bennett, as trustee, and
related Assignment of Lease. (Incorporated by
reference to Exhibit 10(q) to the Company's
Registration Statement (No. 33-4475) on Form S-1.)
10(v). Agreement of Joint Venture, dated as of March 1, 1994,
by and among Eldorado Limited Liability Company,
Galleon, Inc., and the Company. (Incorporated by
reference to Exhibit 10(y) to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1994.)
10(w). Amended and Restated Credit Agreement, dated as of
September 9, 1996, by and among Circus and Eldorado
Joint Venture, the Banks named therein and Wells Fargo
Bank, N.A., as Arranger and Administrative Agent, and
the related Note, Amended and Restated Make-Well
Agreement, Amended and Restated Deed of Trust and
Subordination and Debt Put Agreement. (Incorporated by
reference to Exhibit 10(b)to the Company's Quarterly
Report on Form 10-Q for the quarterly period ended
July 31, 1996.)
10(x). Amendment No.1 to the Amended and Restated Credit
Agreement of Circus and Eldorado Joint Venture, dated
April 4, 1997 and related Amendment No. 1 to the
Amended and Restated Deed of Trust.
10(y). Purchase and Sale Agreement, dated January 10, 1995, by
and between Hacienda Hotel, Inc. and William G. Bennett
of the Hacienda Hotel and Casino, and the related
Assignment and Consent to Assignment to the Company,
dated March 5, 1995. (Incorporated by reference to
Exhibit 10(dd) to the Company's Annual Report on Form
10-K for the fiscal year ended January 31, 1995.)
10(z). Agreement and Plan of Merger, dated March 19, 1995, by
and among the Company and M.S.E. Investments,
Incorporated, Last Chance Investments, Incorporated,
Gold Strike Investments, Incorporated, Diamond Gold,
Inc., Gold Strike Aviation, Incorporated, Gold Strike
Finance Company, Inc., Oasis Development Company, Inc.,
Michael S. Ensign, William A. Richardson, David R.
Belding, Peter A. Simon II and Robert J. Verchota.
(Incorporated by reference to Exhibit 10(ee) to the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1995.)
10(aa). First Amendment to Agreement and Plan of Merger, dated
May 30, 1995, by and among the Company and M.S.E.
Investments, Incorporated, Last Chance Investments,
Incorporated, Goldstrike Investments, Incorporated,
Diamond Gold, Inc., Gold Strike Aviation, Incorporated,
Goldstrike Finance Company, Inc., Oasis Development
Company, Inc., Michael S. Ensign, William A.
Richardson, David R. Belding, Peter A. Simon II and
Robert J. Verchota. (Incorporated by reference to
Exhibit 99.2 of the Schedule 13D of Michael S. Ensign
relating to the Company's Common Stock, filed on
June 12, 1995.)
10(bb). Exchange Agreement, dated March 19, 1995, by and among
the Company and New Way, Inc., a wholly owned
subsidiary of the Company, Glenn W. Schaeffer, Gregg H.
Solomon, Antonio C. Alamo, Anthony Korfman and William
Ensign. (Incorporated by reference to Exhibit 10(ff) to
the Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1995.)
10(cc). First Amendment to Exchange Agreement, dated May 30,
1995, by and among the Company and New Way, Inc., a
wholly owned subsidiary of the Registrant, Glenn W.
Schaeffer, Gregg H. Solomon, Antonio C. Alamo, Anthony
Korfman and William Ensign. (Incorporated by reference
to Exhibit 10(d) to the Company's Current Report on
Form 8-K dated June 1, 1995.)
10(dd). Registration Rights Agreement, dated as of June 1,
1995, by and among the Company and Michael S. Ensign,
William A. Richardson, David R. Belding, Peter A. Simon
II, Glenn W. Schaeffer, Gregg H. Solomon, Antonio C.
Alamo, Anthony Korfman, William Ensign and Robert J.
Verchota. (Incorporated by reference to Exhibit 99.5
of the Schedule 13D of Michael S. Ensign, relating to
the Company's Common Stock, filed on June 12, 1995.)
10(ee). Standstill Agreement, dated as of June 1, 1995, by and
among the Company and Michael S. Ensign, William A.
Richardson, David R. Belding, Peter A. Simon II and
Glenn W. Schaeffer. (Incorporated by reference to
Exhibit 99.4 of the Schedule 13D of Michael S. Ensign,
relating to the Company's Common Stock, filed on
June 12, 1995.)
10(ff). Amendment No. 1 to Standstill Agreement, effective
April 16, 1996, by and among the Company and Michael S.
Ensign, William A. Richardson, David R. Belding, Peter
A. Simon II and Glenn W. Schaeffer. (Incorporated by
reference to Exhibit 99.7 of Amendment No. 2 to the
Schedule 13D of Michael S. Ensign, relating to the
Company s Common Stock, filed on September 5, 1996.)
10(gg).* Executive Officer Annual Bonus Plan. (Incorporated by
reference to Exhibit 10(hh) to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1995.)
10(hh).* Employment Agreement dated June 1, 1995, by and between
the Company and Clyde Turner. (Incorporated by
reference to Exhibit 10(i) to the Company's Current
Report on Form 8-K dated June 1, 1995.)
10(ii).* Employment Agreement dated June 1, 1995, by and between
the Company and Michael S. Ensign. (Incorporated by
reference to Exhibit 99.3 of the Schedule 13D of
Michael S. Ensign, relating to the Company's Common
Stock, filed on June 12, 1995.)
10(jj).* Employment Agreement dated June 1, 1995, by and between
the Company and Glenn W. Schaeffer. (Incorporated by
reference to Exhibit 10(k) to the Company's Current
Report on Form 8-K dated June 1, 1995.)
10(kk).* Employment Agreement dated June 1, 1995, by and between
the Company and William A. Richardson. (Incorporated
by reference to Exhibit 99.3 of the Schedule 13D of
William R. Richardson, relating to the Company's Common
Stock, filed on June 12, 1995.)
10(ll).* Employment Agreement dated June 1, 1995, by and between
the Company and Mike H. Sloan. (Incorporated by
reference to Exhibit 10(m) to the Company's Current
Report on Form 8-K dated June 1, 1995.)
10(mm).* Employment Agreement dated June 1, 1995, by and between
the Company and Kurt D. Sullivan. (Incorporated by
reference to Exhibit 10(n) to the Company's Current
Report on Form 8-K dated June 1, 1995.)
10(nn).* Employment Agreement dated June 1, 1995, by and between
the Company and Antonio C. Alamo. (Incorporated by
reference to Exhibit 10(oo) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(oo).* Employment Agreement dated June 1, 1995, by and between
the Company and Gregg H. Solomon. (Incorporated by
reference to Exhibit 10(pp) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(pp).* Employment Agreement dated June 1, 1995, by and between
the Company and Daniel N. Copp. (Incorporated by
reference to Exhibit 10(qq) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(qq).* Agreement dated April 15, 1996, by and between the
Company and Daniel N. Copp. (Incorporated by reference
to Exhibit 10(rr) to the Company s Annual Report on
Form 10-K for the fiscal year ended January 31, 1996.)
10(rr). Joint Venture Agreement, dated as of December 18, 1992,
between Nevada Landing Partnership and RBG, L.P.
(Incorporated by reference to Exhibit 10(g) to the
Company's Quarterly Report on Form 10-Q for the
quarterly period ended July 31, 1995.)
10(ss). Amendment dated July 15, 1993 to the Joint Venture
Agreement between Nevada Landing Partnership and RBG,
L.P. (Incorporated by reference to Exhibit 10(h) to the
Company's Quarterly Report on Form 10-Q for the
quarterly period ended July 31, 1995.)
10(tt). Amendment dated October 6, 1994 to the Joint Venture
Agreement between Nevada Landing Partnership and RBG,
L.P. (Incorporated by reference to Exhibit 10(i) to the
Company's Quarterly Report on Form 10-Q for the
quarterly period ended July 31, 1995.)
10(uu). Amendment dated June 1, 1995 to the Joint Venture
Agreement between Nevada Landing Partnership and RBG,
L.P. (Incorporated by reference to Exhibit 10(j) to
the Company's Quarterly Report on Form 10-Q for the
quarterly period ended July 31, 1995.)
10(vv). Amendment dated February 28, 1996 to the Joint Venture
Agreement between Nevada Landing Partnership and RBG,
L.P. (Incorporated by reference to Exhibit 10(ww) to
the Company s Annual Report on Form 10-K for the fiscal
year ended January 31, 1996.)
10(ww). Reducing Revolving Loan Agreement, dated as of
December 21, 1994, among Victoria Partners, each bank
party thereto, The Long-Term Credit Bank of Japan,
Ltd., Los Angeles Agency, and Societe Generale, as Co-
agents, and Bank of America National Trust and Savings
Association, as Administrative Agent (without Schedules
or Exhibits) (the "Victoria Partners Loan Agreement").
(Incorporated by reference to Exhibit 99.2 to Amendment
No. 1 on Form 8-K/A to the Current Report on Form 8-K
dated December 9, 1994 of Mirage Resorts, Incorporated.
Commission File No. 1-6697.) (Incorporated by
reference to Exhibit 10 (ww) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(xx). Amendment No. 1 to the Victoria Partners Loan
Agreement, dated as of January 31, 1995. (Incorporated
by reference to Exhibit 10(uu) to the Annual Report on
Form 10-K for the year ended December 31, 1994 of
Mirage Resorts Incorporated. Commission File No. 1-
6697.)
10(yy). Amendment No. 2 to the Victoria Partners Loan
Agreement, dated as of June 30, 1995. (Incorporated by
reference to Exhibit 10.1 to the Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 1995
of Mirage Resorts, Incorporated. Commission File No.
1-6697.)
10(zz). Amendment No. 3 to the Victoria Partners Loan
Agreement, dated as of July 28, 1995. (Incorporated by
reference to Exhibit 10.3 to the Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 1995
of Mirage Resorts, Incorporated. Commission File No.
1-6697.)
10(aaa). Amendment No. 4 to the Victoria Partners Loan
Agreement, dated as of October 16, 1995. (Incorporated
by reference to Exhibit 10(a) to the Company's
Quarterly Report on Form 10-Q for the quarterly period
ended October 31, 1995.)
10(bbb). Amendment No. 5 to the Victoria Partners Loan Agreement
dated as of August 1, 1996. (Incorporated by reference
to Exhibit 10(a) to the Company s Quarterly Report on
Form 10-Q for the quarterly period ended July 31,
1996.)
10(ccc). Amendment No.6 to the Victoria Partners Loan Agreement,
dated as of April 12, 1997.
10(ddd). Joint Venture Agreement, dated as of December 9, 1994,
between MRGS Corp. and Gold Strike L.V. (without
Exhibit) (the "Victoria Partners Venture Agreement").
(Incorporated by reference to Exhibit 99.1 to the
Current Report on Form 8-K dated December 9, 1994 of
Mirage Resorts, Incorporated. Commission File No.
1-6697.)
10(eee). Amendment No. 1 to the Victoria Partners Venture
Agreement dated as of April 17, 1995. (Incorporated by
reference to Exhibit 10(c) to the Quarterly Report on
Form 10-Q for the quarterly period ended March 31, 1995
of Mirage Resorts, Incorporated. Commission File No.
1-6697.)
10(fff). Amendment No. 2 to the Victoria Partners Venture
Agreement dated as of September 25, 1995.
(Incorporated by reference to Exhibit 10.4 to the
Quarterly Report on Form 10-Q for the quarterly period
ended September 30, 1995 of Mirage Resorts
Incorporated. Commission File No. 1-6697.)
10(ggg). Amendment No. 3 to the Victoria Partners Venture
Agreement dated as of February 28, 1996. (Incorporated
by reference to Exhibit 10(fff) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(hhh). Amendment No. 4 to the Victoria Partners Venture
Agreement dated as of May 29, 1996. (Incorporated by
reference to Exhibit 10(b) to the Company s Quarterly
Report on Form 10-Q for the quarterly period ended
April 30, 1996.)
10(iii). Consulting Agreement, dated June 1, 1995, between
Circus Circus Casinos, Inc. (a subsidiary of the
Company) and Lakeview Company. (Incorporated by
reference to Exhibit 10(ggg) to the Company s Annual
Report on Form 10-K for the fiscal year ended
January 31, 1996.)
10(jjj). Agreement, dated May 30, 1996, with Mirage Resorts,
Incorporated regarding the development of certain
property in Atlantic City, New Jersey. (Incorporated by
reference to Exhibit 10(a) to the Company s Quarterly
Report on Form 10-Q for the quarterly period ended
April 30, 1996.)
10(kkk). Stock Transfer Agreement, dated January 23, 1997, by
and between the Company, Windsor Casino Limited,
Windsor Casino Supplies Limited and Windsor Casino
Financial Limited and Caesars World, Inc., Conrad
International Investment Corporation and Hilton Hotels
Corporation.
10(lll).* Description of Consulting Plan adopted June 21, 1996.
13. Portions of the Annual Report to Stockholders for the
Year Ended January 31, 1997 specifically incorporated
by reference as part of this Report.
21. Subsidiaries of the Company.
23. Consent of Arthur Andersen LLP. (See page 57.)
27. Financial Data Schedule for the year ended January 31,
1997 as required under EDGAR.
_____________
* This exhibit is a management contract or compensatory plan
or arrangement required to be filed as an exhibit to this
Report.
Certain instruments with respect to long-term debt have not
been filed hereunder or incorporated by reference herein where
the total amount of such debt thereunder does not exceed 10% of
the consolidated total assets of the Company. Copies of such
instruments will be furnished to the Securities and Exchange
Commission upon request.
(b) During the fourth quarter of the fiscal year ended
January 31, 1997, the Company filed no Current Report on Form
8-K.
(c) The exhibits required by Item 601 of Regulation S-K
filed as part of this Report or incorporated herein by reference
are listed in Item 14(a)(3) above, and the exhibits filed
herewith are listed on the Index to Exhibits which accompanies
this Report.
(d) See Item 14(a)(2) of this Report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
CIRCUS CIRCUS ENTERPRISES, INC.
Dated: April 30, 1997 By: Clyde T. Turner
Clyde T. Turner, Chairman
of the Board
Pursuant to the requirements of the Securities Exchange
Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on
the dates indicated.
Signature Title Date
Clyde T. Turner Chairman of the Board April 30, 1997
Clyde T. Turner and Chief Executive
Officer (Principal
Executive Officer)
Michael S. Ensign Vice Chairman of the April 30, 1997
Michael S. Ensign Board and Chief Operating
Officer
William A. Richardson Executive Vice President April 30, 1997
William A. Richardson and Director
Glenn Schaeffer President, Chief April 30, 1997
Glenn Schaeffer Financial Officer,
Treasurer and Director
(Principal Financial
Officer)
Les Martin Controller (Principal April 30, 1997
Les Martin Accounting Officer)
Richard P. Banis Director April 30, 1997
Richard P. Banis
Arthur H. Bilger Director April 30, 1997
Arthur H. Bilger
Richard A. Etter Director April 30, 1997
Richard A. Etter
Michael D. McKee Director April 30, 1997
Michael D. McKee
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation of our report dated February 26, 1997 included (or
incorporated by reference) in Circus Circus Enterprises, Inc.'s
Annual Report on Form 10-K for the year ended January 31, 1997,
into the Company's previously filed Form S-8 Registration
Statements File Nos. 2-91950, 2-93578, 33-18278, 33-29014, 33-
39215, 33-56420 and 33-53303 and to the Company's previously
filed Form S-3 Registration Statements File Nos. 33-65359 and
333-16327.
ARTHUR ANDERSEN LLP
Las Vegas, Nevada
April 29, 1997
INDEX TO EXHIBITS
FORM 10-K
Fiscal Year Ended
January 31, 1997
Exhibit
Number
3(ii). Restated Bylaws of the Company dated November 30, 1996.
4(g). Amendment No. 4 to the $1.5 Billion Loan Agreement, by
and among the Company, the Banks named therein and
Wells Fargo Bank, N.A., as administrative agent.
10(d).* Amended and Restated 1989 Stock Option Plan of the
Company, dated April 25, 1997.
10(f).* Amended and Restated 1991 Stock Incentive Plan of the
Company, dated April 25, 1997.
10(g).* Amended and Restated 1993 Stock Option Plan of the
Company, dated April 25, 1997.
10(x). Amendment No.1 to the Amended and Restated Credit
Agreement of Circus and Eldorado Joint Venture, dated
April 4, 1997 and related Amendment No. 1 to the
Amended and Restated Deed of Trust.
10(ccc). Amendment No.6 to the Victoria Partners Loan Agreement,
dated as of April 12, 1997.
10(kkk). Stock Transfer Agreement, dated January 23, 1997, by
and between the Company, Windsor Casino Limited,
Windsor Casino Supplies Limited and Windsor Casino
Financial Limited and Caesars World, Inc., Conrad
International Investment Corporation and Hilton Hotels
Corporation.
10(lll).* Description of Consulting Plan adopted June 21, 1996.
13. Portions of the Annual Report to Stockholders for
the Year Ended January 31, 1997 specifically
incorporated by reference as part of this Report.
21. Subsidiaries of the Company.
23. Consent of Arthur Andersen LLP.
27. Financial Data Schedule for the year ended January 31,
1997 as required under EDGAR.