Caesars Files Registration Statements – But Why?

I’m a bit confused.   About a month ago, Caesars had a funky IPO where they just sold a little teeny bit of stock into the market.  In that initial filing, there was a note (emphasis mine):

“12,372,835 shares of our common stock held by the Paulson Investors and 22,339,143 shares of our common stock held by the Participating Co-Investors will be freely tradable without restriction or further registration under the Securities Act, except for any shares which may be acquired by any of our “affiliates” as that term is defined in Rule 144 under the Securities Act, which will be subject to the resale limitations of Rule 144 and to existing lockup arrangements.”

Today, Caesars filed two more S-3 registration statements.  The first is for up to $ 500MM of stock to be sold by the company – it’s a registration statement (like a shelf) – not an offering.  The second is for 22,339,143 shares to be sold by existing shareholders.  Does that number sound familiar?  It’s the same number that they quoted in the IPO.  I’m confused, though, because the IPO filing, which I quoted above, says that the shares are freely tradable without further registration.   Why, then, did they file a further registration?  Can any capital markets lawyers help me out here?

Anyway, it looks to me like there are two different things going on:

1) the company is set up to sell up to $ 500MM in stock, and

2) the selling shareholders are set up to sell about $ 266MM in stock.

Either one of these sales may be done in a lump sum or  in pieces over time.  As the filing explains:

We may offer and sell pursuant to one or more prospectus supplements, from time to time, shares of our common stock, in one or more underwritten or other public offerings and at prices and on terms that will be determined at the time of the offering, up to a maximum aggregate offering price of $500,000,000. This prospectus describes the general terms of these securities and the general manner in which these securities will be offered. We will provide the amounts, prices and specific terms of these securities in supplements to this prospectus. The prospectus supplements will also describe the specific manner in which these securities will be offered and may also supplement, update or amend information contained in this prospectus

and for the selling shareholders:

The selling stockholders may offer the shares from time to time as they may determine through public or private transactions or through other means described in the section entitled “Plan of Distribution” at fixed or privately negotiated prices. The prices at which the selling stockholders may sell the shares may be determined by the prevailing market price for the shares at the time of sale, may be different than such prevailing market prices or may be determined through negotiated transactions with third parties.


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