Nevada Gold & Casinos : Definitive proxy statement relating to merger or acquisition

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES

EXCHANGE ACT OF 1934

Filed by the Registrant ☒

Filed by a Party other than the Registrant Check the appropriate box:

☐

• ☐ Preliminary Proxy Statement

• ☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

• ☒ Definitive Proxy Statement

• ☐ Definitive Additional Materials

• ☐ Soliciting Material under §240.14a-12

NEVADA GOLD & CASINOS, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

• ☐ No fee required.

• ☐ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

  • (1) Title of each class of securities to which transaction applies:

    Common Stock, par value $0.12 per share, of Nevada Gold & Casinos, Inc. ("Common Stock").

  • (2) Aggregate number of securities to which transaction applies:

    16,917,382 shares of Common Stock (including restricted shares) and 676,000 options to purchase shares of Common Stock with exercise prices below $2.50.

  • (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

    Solely for the purpose of calculating the filing fee, the underlying value of the transaction was calculated based on the sum of (A) 16,917,382 shares of Common Stock multiplied by $2.50 per share and (B) options to purchase 676,000 shares of Common Stock with exercise prices below $2.50, multiplied by $1.40 per share (which is the difference between $2.50 and the weighted average exercise price per share). In accordance with Section 14(g) of the Securities Exchange Act of 1934, as amended, the filing fee was determined by multiplying 0.0001212 by the sum of the preceding sentence.

  • (4) Proposed maximum aggregate value of transaction: $43,239,855

  • (5) Total fee paid: $5,240.67

• ☒ Fee paid previously with preliminary materials.

• ☐ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

  (1) Amount Previously Paid:

  • (2) Form, Schedule or Registration Statement No.:

  • (3) Filing Party:

  • (4) Date Filed:

TABLE OF CONTENTS

NEVADA GOLD & CASINOS, INC.

133 E. WARM SPRINGS ROAD, SUITE 102

LAS VEGAS, NV 89119

Las Vegas, Nevada

January 25, 2019​

Dear Stockholder:

You are cordially invited to attend the special meeting of stockholders of Nevada Gold & Casinos, Inc. (the "Company") to be held at 10:00 a.m., Pacific Time, on Friday, February 22, 2019 at the Tropicana Las Vegas Casino Hotel, 3801 Las Vegas Boulevard South, Las Vegas, Nevada 89109.

At the special meeting, you will be asked to consider and vote upon a proposal to approve the Agreement and Plan of Merger, dated as of September 18, 2018, as amended by Amendment No. 1 to Agreement and Plan of Merger dated as of November 29, 2018 (as it may be further amended from time to time, the "Merger Agreement"), by and among the Company, Maverick Casinos LLC, a Nevada limited liability company ("Parent"), and Maverick Casinos Merger Sub, Inc., a Nevada corporation and a wholly-owned subsidiary of Parent ("Merger Sub"). Under the terms of the Merger Agreement, Merger Sub will be merged with and into the Company, with the Company continuing as the surviving corporation following the merger. If the Company's stockholders approve the Merger Agreement and the merger is completed, you will be entitled to receive $2.50 in cash, subject to certain possible adjustments described in the Merger Agreement, without interest (the "Merger Consideration"); provided that if the merger occurs after February 1, 2019, the Merger Consideration will be automatically increased by $0.01 for each month following such date until (and including) the date of the merger (prorated by the number of days for partial months), and net of any taxes required to be withheld therefrom, for each share of the Company's common stock you own immediately prior to the merger.

After careful consideration, our Board of Directors has, by unanimous vote, determined that the merger is fair to, and in the best interests of, the Company, including its stockholders, and unanimously approved and declared advisable the Merger Agreement, the merger, and the other transactions contemplated by the Merger Agreement, and recommends that you vote "FOR" the approval of the Merger Agreement.

At the special meeting, you will also be asked to consider and vote on (i) a proposal to approve, on an advisory and non-binding basis, certain compensation that will or may be paid or become payable to our named executive officers in connection with the proposed merger, and (ii) a proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the special meeting to approve the proposal to approve the Merger Agreement. Our Board of Directors unanimously recommends that you vote "FOR" the proposal to approve, on an advisory basis, certain compensation that will or may be paid or become payable to our named executive officers in connection with the Merger, and "FOR" the proposal to adjourn the special meeting, if necessary, to solicit additional proxies in favor of the proposal to approve the Merger Agreement.

The accompanying proxy statement provides you with detailed information about the proposed merger and the special meeting. Please give this material your careful attention.

Whether or not you plan to attend the special meeting, please fill in, date, sign, and return the enclosed proxy card which is solicited by, and on behalf of, the Board of Directors, or submit your proxy by telephone or the Internet. If your shares of common stock of the Company are held in an account at a broker, bank, or other nominee, you should instruct your broker, bank, or other nominee how to vote your shares in accordance with the instructions furnished by your broker, bank, or nominee. Regardless of the number of shares of common stock of the Company you own, your vote is important. The failure to vote has the same effect as a vote against the approval of the Merger Agreement.

Thank you for your cooperation and continued support.

Sincerely,

Las Vegas, Nevada

January 25, 2019

This proxy statement is dated January 25, 2019 and is first being mailed to the Company's stockholders on or about

January 25, 2019.

NEVADA GOLD & CASINOS, INC. 133 E. WARM SPRINGS ROAD, SUITE 102

LAS VEGAS, NV 89119

​

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

​

Las Vegas, Nevada

January 25, 2019​

To the Stockholders of

NEVADA GOLD & CASINOS, INC.

NOTICE IS HEREBY GIVEN that a special meeting of stockholders of Nevada Gold & Casinos, Inc., a Delaware corporation (the "Company"), will be held at 10:00 a.m., Pacific Time, on Friday, February 22, 2019 at the Tropicana Las Vegas Casino Hotel, 3801 Las Vegas Boulevard South, Las Vegas, Nevada 89109 for the following purposes:

• 1. To consider and vote upon a proposal to approve the Agreement and Plan of Merger, dated as of September 18, 2018, as amended by Amendment No. 1 to Agreement and Plan of Merger dated as of November 29, 2018 (as it may be further amended from time to time, the "Merger Agreement"), by and among the Company, Maverick Casinos LLC, a Nevada limited liability company ("Parent"), and Maverick Casinos Merger Sub, Inc., a Nevada corporation and a wholly-owned subsidiary of Parent ("Merger Sub"). A copy of the Merger Agreement is attached as Appendix A to the accompanying proxy statement. Pursuant to the terms of the Merger Agreement, among other things, (i) Merger Sub will be merged with and into the Company, with the Company continuing as the surviving corporation and becoming a wholly-owned subsidiary of Parent, and (ii) each share of common stock of the Company issued and outstanding immediately prior to the merger (other than any shares held in the Company's treasury or owned, directly or indirectly, by a wholly-owned subsidiary of the Company or Parent or Merger Sub), will be converted into the right to receive $2.50 in cash, subject to certain possible adjustments described in the Merger Agreement, without interest (the "Merger Consideration"); provided that if the merger occurs after February 1, 2019, the Merger Consideration will be automatically increased by $0.01 for each month following such date until (and including) the date of the Merger (prorated by the number of days for partial months), and net of any taxes required to be withheld therefrom.

• 2. To consider and vote upon a proposal to approve, on an advisory and non-binding basis, certain compensation that will or may be paid or become payable to our named executive officers in connection with the proposed merger.

• 3. To consider and vote upon a proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the special meeting to approve the proposal to approve the Merger Agreement.

• 4. To transact such other business as may properly come before the special meeting or any adjournment or postponement of the special meeting.

Only stockholders of record at the close of business on January 22, 2019 are entitled to notice of and to vote at the special meeting and at any adjournment or postponement of the special meeting. All stockholders of record are cordially invited to attend the special meeting in person.

The approval of the Merger Agreement requires the affirmative vote of the holders of a majority of the outstanding shares of the Company's common stock, and the approval of the proposal regarding certain merger-related executive compensation arrangements and the proposal to adjourn the special meeting requires the affirmative vote of the holders of a majority of the outstanding shares of Company's common stock entitled to vote on the proposal and casting votes for or against the proposal, assuming a quorum is present. Whether or not you plan to attend the special meeting, you are urged to vote your shares by marking, signing, dating, and returning the proxy card as promptly as possible in the postage prepaid envelope enclosed for that purpose or by submitting your proxy by telephone or the Internet. The failure to vote has the same effect as a vote against the approval of the Merger Agreement but will not affect the outcome of the vote regarding the non-binding compensation proposal or the adjournment proposal. Any stockholder attending the special meeting may vote in person even if he or she has returned a proxy card or submitted a proxy by telephone or the Internet.

Our Board of Directors, by unanimous vote, recommends that you vote "FOR" the proposal to approve the Merger Agreement, "FOR" the proposal to approve, on an advisory basis, certain compensation that will or may be paid or become payable to our named executive officers in connection with the Merger, and "FOR" the proposal to adjourn the special meeting, if necessary, to solicit additional proxies in favor of the proposal to approve the Merger Agreement.

Pursuant to Nevada Revised Statutes 92A.390, there are no rights of dissent available to the stockholders of the Company in connection with the merger.

By Order of the Board of Directors,

James D. Meier

Vice President, Chief Financial Officer and Secretary

Please do not send your stock certificates at this time. If the Merger Agreement is approved and the merger is completed, you will be sent instructions regarding the surrender of your stock certificates in exchange for the per share merger consideration.

TABLE OF CONTENTS

QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

1

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

17

Nevada Gold & Casinos, Inc.

19

Maverick Casinos Acquisition Sub, Inc.

19

Time, Place and Purpose of the Special Meeting

20

Vote Required

20

Voting By Proxy

21

Background of the Merger

22

Recommendation of the Board of Directors

32

Treatment of Company Equity Awards

33

Golden Parachute Compensation

35

FINANCING

38

The Equity Commitment Letter

38

CLUB FORTUNE CASINO SALE

42

FINANCIAL FORECASTS

51

REGULATORY APPROVALS

55

THE MERGER AGREEMENT

57

The Structure

57

Company Common Stock

57

Adjustments to the Merger Consideration Related to Club Fortune Casino Sale

58

Page
SUMMARY	5
THE PARTIES TO THE MERGER	19
Maverick Casinos LLC	19
THE SPECIAL MEETING	20
Who Can Vote at the Special Meeting	20
Adjournment and Postponement	21
THE MERGER	22
Reasons for the Merger	29
Interests of the Company's Directors and Executive Officers in the Merger	32
Executive Officer Employment Agreements	33
Indemnification and Insurance	36
The Debt Commitment Letter	38
SECURITIES PURCHASE AGREEMENT AND ESCROW DEPOSIT	40
OPINION OF THE COMPANY'S FINANCIAL ADVISOR	43
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES	54
LITIGATION RELATED TO THE MERGER	56
Effective Time	57
Treatment of Stock and Options	57
Treatment of Company Equity Awards	58
Exchange and Payment Procedures	59

i

Representations and Warranties

60

No Solicitation of Alternative Proposals

65

Employee Matters

69

Further Action; Efforts; Regulatory Approvals

70

Additional Covenants

72

Securities Litigation

73

Obligations of Merger Sub

73

Other Covenants and Agreements

73

Termination

76

Parent Termination Fee

78

Fees and Expenses

79

Jurisdiction; Specific Performance

79

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

82

ADVISORY VOTE ON MERGER-RELATED COMPENSATION

84

FUTURE STOCKHOLDER PROPOSALS

85

Other Business at the Special Meeting

85

TABLE OF CONTENTS
(Continued)
Page
Conduct of the Company's Business Pending the Merger	63
Access to Information; Financing Cooperation	68
Indemnification; Directors' and Officers' Insurance	70
Financing Activities	71
Company Stockholders' Meeting	72
Delisting and Deregistration of Company Common Stock	73
Company Credit Agreement	73
Conditions to the Merger	73
Company Termination Fee and Expense Reimbursement	77
Limitation on Remedies	78
Amendment and Waiver	79
MARKET PRICE OF COMPANY COMMON STOCK	81
NO APPRAISAL RIGHTS	84
ADJOURNMENT OF THE SPECIAL MEETING	85
OTHER MATTERS	85
Multiple Stockholders Sharing One Address	85

WHERE YOU CAN FIND ADDITIONAL INFORMATION

86

APPENDIX A -

Agreement and Plan of Merger and Amendment No. 1 to Agreement and Plan of Merger

APPENDIX B - Securities Purchase Agreement

APPENDIX C - Escrow Agreement

APPENDIX D - Opinion of Rossoff & Company, LLCii