oPreliminary Proxy Statement

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

þ Definitive Proxy Statement

o Definitive Additional Materials

o Soliciting Material Pursuant to 240.14a-12

(Name of Registrant as Specified In Its Charter)

     Payment of Filing Fee (Check the appropriate box):

o No fee required.

o 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 $0.01 per share, of Dave & Buster’s, Inc.
			(2	)		Aggregate number of securities to which transaction applies:
			(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):

			(4	)		Proposed maximum aggregate value of transaction:
			(5	)		Total fee paid:

     þ Fee paid previously with preliminary materials.

     o 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:

 

 

January 25, 2006

DAVE & BUSTER’S, INC.

2481 Manana Drive

Dallas, Texas 75220

To our Stockholders:

      The board of directors of Dave & Buster’s, Inc., has unanimously approved a merger providing for the acquisition of Dave & Buster’s by WS Midway Holdings, Inc., an affiliate of Wellspring Capital Management LLC. If the merger is completed, you will receive $18.05 in cash, without interest and less any required withholding taxes, for each share of Dave & Buster’s common stock that you own.

      You will be asked, at a special meeting of the stockholders of Dave & Buster’s, to consider and vote upon a proposal to approve the merger agreement and a proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies for the approval of the merger agreement. The special meeting will be held at The Show Room at Dave & Buster’s, 10727 Composite Drive, Dallas, Texas 75220 on Tuesday, February 28, 2006, at 10:00 A.M. (Central Standard Time).

      The proxy statement attached to this letter provides you with information about the proposed merger and the special meeting of stockholders. You are encouraged to read the proxy statement carefully, as it includes details of the proposed merger and other important information related to the merger and the special meeting of stockholders. You may also obtain more information about Dave & Buster’s from documents we have filed with the Securities and Exchange Commission.

      Our board of directors has unanimously approved the merger agreement and has determined that the merger is advisable, fair to and in the best interests of Dave & Buster’s and our stockholders. Accordingly, our board of directors recommends that you vote “FOR” approval of the merger agreement and “FOR” approval of adjournment of the special meeting, if necessary or appropriate, to solicit additional proxies for the approval of the merger agreement.

      Your vote is important. Because the merger agreement requires the affirmative vote of the holders of two-thirds of the outstanding shares of Dave & Buster’s common stock, a failure to vote will have the same effect as a vote “against” the merger. Accordingly, whether or not you plan to attend the special meeting of stockholders, please complete, sign and date the accompanying proxy card and return it in the enclosed prepaid envelope, or vote your shares by telephone or the Internet using the instructions on the enclosed proxy card or voting instruction form. If your shares are held in “street name”, you should instruct your broker, bank or other nominee how to vote in accordance with the voting instruction form furnished by your broker, bank or other nominee. If you attend the special meeting, you may revoke your proxy and vote in person if you wish, even if you have previously returned your proxy card.

      Thank you for your cooperation and continued support.

      This proxy statement is dated January 25, 2006, and is first being mailed to stockholders on or about January 25, 2006.

DAVE & BUSTER’S, INC.

2481 Manana Drive

Dallas, Texas 75220

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To Be Held On Tuesday, February 28, 2006

TABLE OF CONTENTS

	Dave & Buster’s, Inc.
	2481 Manana Drive
	Dallas, Texas 75220
	(214) 357-9588

	WS Midway Holdings, Inc.
	c/o Wellspring Capital Management LLC
	Lever House
	390 Park Avenue
	New York, New York 10022-4608
	(212) 318-9800

	WS Midway Acquisition Sub, Inc.
	c/o Wellspring Capital Management LLC
	Lever House
	390 Park Avenue
	New York, New York 10022-4608
	(212) 318-9800

	•	each outstanding share of D&B common stock, other than shares held by Midway or Merger Sub or held in treasury by D&B or by any subsidiary of D&B or held by stockholders who perfect their appraisal rights under Missouri law, will be converted into the right to receive $18.05 in cash, without interest, less any applicable withholding taxes;
	•	each outstanding warrant to acquire D&B common stock will be converted into a warrant entitling the holder to receive, upon exercise and payment of the exercise price, an amount in cash equal to the product of $18.05 multiplied by the number of shares for which the warrant was exercisable immediately prior to the merger, without interest;
	•	each outstanding option to acquire D&B common stock will be converted into the right to receive a cash payment equal to the amount by which the $18.05 per share merger consideration exceeds the per share exercise price of the option, without interest, less any applicable withholding taxes; and
	•	each outstanding share of common stock of Merger Sub will be converted into one share of common stock of D&B.

	•	delivering to D&B’s corporate secretary at D&B’s corporate offices at 2481 Manana Drive, Dallas, Texas 75220, on or before the business day prior to the special meeting, a later-dated, signed proxy card or a written revocation of your proxy; or
	•	delivering a later-dated, signed proxy card or a written revocation of your proxy to D&B at the special meeting prior to the taking of the vote on the merger agreement; or
	•	attending the special meeting and voting in person; or
	•	if you hold your shares in “street name” and have instructed your broker, bank or other nominee to vote your shares, following the directions received from your nominee to change those instructions.

	•	Stockholder Approval. The approval of the merger agreement by our stockholders.
	•	HSR Approval and Consents. The waiting period for the completion of the merger under the Hart-Scott-Rodino Act of 1976, as amended, which we refer to as the “Hart-Scott-Rodino Act,” shall have expired and the parties must have obtained all consents of governmental entities and third parties required for completion of the merger.

	•	No Challenge. No statute, rule, regulation, judgment, writ, order injunction or decree shall have been promulgated, enacted, entered or enforced, and no other action shall have been taken, by any governmental entity which prohibits or restricts the completion of the merger.
	•	Representations and Warranties. The accuracy of the other party’s representations and warranties, in each case, subject to the materiality standard contained in the merger agreement.
	•	Compliance with Covenants. The performance, in all material respects, by the other party of its covenants and agreements in the merger agreement.

	•	Dissenting Shares. The aggregate number of shares held by persons exercising appraisal rights under Missouri law shall be less than 5% of the total number of D&B shares outstanding at the effective time of the merger.

	•	by mutual written consent of the parties;
	•	by either Midway, Merger Sub or D&B, if stockholder approval of the merger is not obtained or a governmental entity issues a final and non-appealable order, decree or ruling, or takes any other action, prohibiting the merger;
	•	by Midway or Merger Sub, if:

	•	the merger is not completed by June 30, 2006, except that if the failure to obtain governmental approvals of the merger is the sole condition remaining to be satisfied, then there will be an automatic 30-day extension of the June 30 termination date;
	•	there is a material breach by D&B of any of its representations, warranties, covenants or agreements in the merger agreement, such that the closing conditions would not be satisfied and which breach has not been timely cured;
	•	D&B’s board of directors withdraws, modifies or changes in a manner adverse to Merger Sub, its recommendation of the approval of the merger agreement and the merger;

	•	D&B’s board of directors approves or recommends any proposal other than one made by Midway and Merger Sub, or fails to reject and, if applicable, fails to recommend against any proposal other than one made by Midway and Merger Sub; or D&B enters into an agreement related to an acquisition proposal with any party other than Midway and Merger Sub; or

	•	by D&B, if:

	•	the merger is not completed by June 30, 2006, except that if the failure to obtain governmental approvals of the merger is the sole condition remaining to be satisfied, then there will be an automatic 30-day extension of the June 30 termination date;
	•	there is a material breach by Midway or Merger Sub of any of their representations, warranties, covenants or agreements in the merger agreement, such that the closing conditions would not be satisfied and which breach has not been timely cured;
	•	it does so prior to the approval of the merger by the D&B stockholders, for the purpose of entering into a binding written definitive agreement for a superior proposal; however, in such event, D&B must pay Midway a termination fee of $10,175,000 and their transaction expenses, not to exceed $3,000,000.

	•	the parties will remain liable for any breach of the merger agreement;
	•	Midway and Merger Sub will remain liable for breaches of the confidentiality agreement;
	•	if applicable to the circumstances under which the merger agreement was terminated, D&B will remain liable for payment of the termination fee and expenses to Midway; and
	•	each party will remain liable for its own costs and expenses in connection with the merger and the merger agreement, other than under the circumstances in which D&B must reimburse Midway and its affiliates for their expenses.

	•	D&B entered into executive retention agreements with Messrs. Corley and Corriveau in April 2000, and since 2001, D&B has entered into an executive retention agreement with each of its executive officers. Each executive retention agreement provides for the executive officer’s continued employment for two years (or one year in the case of Messrs. Corriveau and Corley) after a change of control of D&B (defined in relevant part as stockholder approval of the merger), on terms generally consistent with those in effect during the 90-day period before the change of control of D&B. Each executive retention agreement provides that, if the executive officer’s employment is terminated by D&B without cause or by the executive officer for good reason within that two-year (or one-year) employment period, the executive officer generally will be entitled to (i) a lump-sum

		cash payment in respect of an annual bonus equal to the greater of (A) the maximum bonus that the executive officer could have received pursuant to the annual incentive plan in effect 90 days before stockholder approval of the merger or (B) 60% of the executive officer’s annual base salary (such greater amount, the “annual bonus”), pro-rated for the portion of the last fiscal year during which the executive officer was employed, (ii) a lump-sum cash severance payment equal to two times the sum of the executive officer’s annual base salary and annual bonus (or three times in the case of Messrs. Corriveau and Corley), and (iii) continued incentive, retirement, and fringe benefits and health and other welfare benefits for the remainder of the two-year (or one-year) employment period following stockholder approval of the merger plus two additional years. In addition, Messrs. Corriveau and Corley will each be entitled to a payment equal to the sum of his respective annual base salary and annual bonus if he remains employed for the entirety of the one-year employment period beginning upon stockholder approval of the merger.
	•	All of D&B’s executive officers and certain of its outside directors hold options to purchase D&B common stock. The merger agreement provides that, at the effective time of the merger, each outstanding option to purchase common stock of D&B, whether or not vested, will be cancelled in exchange for the right to receive, for each share subject to such option, a cash payment equal to the amount by which the $18.05 per share merger consideration exceeds the per share exercise price of the option, without interest, less any applicable withholding taxes. Pursuant to the terms of the option plans, all options will vest upon stockholder approval of the merger (other than options held by non-employee directors). If D&B stockholders approve the merger, but the merger is not consummated, all such options will remain vested; however, D&B could cause the termination of such options, to the extent not previously exercised, within a period not exceeding 30 days by providing an appropriate notice to the holders of such options.
	•	All of D&B’s executive officers and directors have been granted restricted shares of D&B common stock. Upon stockholder approval of the merger, all of the restricted stock that has been granted will vest and all restrictions on those shares will immediately lapse. Upon consummation of the merger, the holders of those shares of previously restricted stock will be entitled to receive a payment equal to $18.05, without interest, less any applicable withholding taxes, for each share of previously restricted stock.
	•	Certain of our executive officers have elected to participate in our Select Executive Retirement Plan, which we refer to as the “SERP.” Pursuant to the SERP, D&B’s executive officers may elect to defer payment of their base salary and bonus. An executive officer is fully vested at all time in his or her own deferrals and any earnings thereon and generally vests in any employer contributions (and any earnings thereon) following five years of plan participation (with ratable vesting of 20% per year of plan participation less than five years). However, upon consummation of the merger, each executive officer who is participating in the SERP will become fully vested in the amounts credited to him or her under the SERP (whether or not then otherwise vested).
	•	D&B will continue the indemnification arrangements and directors’ and officers’ liability insurance for D&B’s past, present and future directors and officers for a period of six years following the merger.

QUESTIONS AND ANSWERS ABOUT THE MERGER

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

      This proxy statement, and the documents to which we refer you in this proxy statement, contain forward-looking statements intended to be covered by the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include financial projections and their underlying assumptions, other information concerning possible or assumed future results of operations of D&B, the expected completion and timing of the merger and other information relating to the merger. There are forward-looking statements throughout this proxy statement, including, among others, under the headings “Summary Term Sheet,” “The Merger,” “The Merger — Fairness Opinion of Piper Jaffray” and in statements containing the words “believes,” “plans,” “expects,” “anticipates,” “intends,” “estimates” or other similar expressions. You should be aware that forward-looking statements involve known and unknown risks and uncertainties. These forward-looking statements reflect management’s current expectations and forecasts, and we cannot assure you that the actual results or developments we anticipate will be realized, or even if realized, that they will have the expected effects on the merger or on the business or operations of D&B. In addition to other factors and matters discussed in this proxy statement or discussed and identified in other public filings we make with the Securities and Exchange Commission, which we refer to as the “SEC,” we believe the following risks could cause actual results to differ materially from those discussed in the forward-looking statements:

      This proxy statement includes financial forecasts of D&B as part of such forward-looking statements. See “The Merger — Background of the Merger.” The financial forecasts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those statements and should be read with caution. The financial forecasts included in this proxy statement do not give effect to the merger or the related financing transactions. The financial forecasts are subjective in many respects and thus susceptible to interpretations and periodic revisions based on actual experience and recent developments. While presented with numerical specificity, the financial forecasts are based upon a variety of estimates and hypothetical assumptions made by our management. Some or all of the assumptions may not be realized, and they are inherently subject to significant business, industry, economic, regulatory, financial and competitive uncertainties and contingencies, all of which are difficult to predict and many of which are beyond our control. Accordingly, there can be no assurance that the assumptions made in preparing the financial forecasts will prove accurate, and actual results may materially differ from those included in the financial forecasts.

      The financial forecasts included in this proxy statement include EBITDA. “EBITDA” is defined as income (loss) before income tax expense (benefit), net interest expense, depreciation and amortization. EBITDA is a non-GAAP measure and should not be considered an alternative to any other measure of performance presented in accordance with GAAP. You should not consider EBITDA in isolation from, or as a substitute for, net income (loss), cash flows from operating activities and other consolidated income or cash flow statement data prepared in accordance with GAAP, or as a measure of profitability or liquidity. EBITDA was presented in the projections provided to Wellspring because management believes that it could be useful in assessing projected operating performance and projected performance relative to

financial obligations. EBITDA, as used by us, is not necessarily comparable with similarly titled measures of other companies, because all companies do not calculate EBITDA in the same fashion.

      You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this proxy statement or the date of any document incorporated by reference. All subsequent written and oral forward-looking statements concerning the merger or other matters addressed in this proxy statement and attributable to D&B or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Except to the extent required by applicable law or regulation, D&B undertakes no obligation to republish revised forward-looking statements to reflect events or circumstances after the date of this proxy statement or to reflect the occurrence of unanticipated events.

THE SPECIAL MEETING

      This proxy statement is furnished in connection with the solicitation of proxies by D&B’s board of directors for a special meeting of stockholders to be held on Tuesday, February 28, 2006, at 10:00 A.M. (Central Standard Time), at The Show Room at Dave & Buster’s, 10727 Composite Drive, Dallas, Texas, or at any adjournment or postponement of the special meeting. Shares of D&B common stock represented by properly executed proxies received by D&B will be voted at the special meeting or any adjournment or postponement of the special meeting in accordance with the terms of those proxies, unless revoked.

Proposals to Be Considered at the Special Meeting

      At the special meeting, you will consider and vote upon a proposal to approve the merger agreement entered into by D&B, Midway and Merger Sub, pursuant to which Merger Sub will be merged with and into D&B and a proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies for the approval of the merger agreement.

      At the effective time of the merger, the separate corporate existence of Merger Sub will cease, and D&B will be the surviving corporation and will become a wholly-owned, privately held subsidiary of Midway. In the merger:

      Stockholders who perfect their appraisal rights under Missouri law will be entitled to receive a cash payment from D&B in the amount of the “fair value” of their shares, determined in accordance with Missouri law. After the merger, these shares will not represent any interest in D&B other than the right to receive this cash payment. See “The Merger — Appraisal Rights.”

Record Date and Quorum

      Only stockholders of record at the close of business on January 18, 2006, referred to as the “record date,” are entitled to notice of and to vote at the special meeting. On that date, there were approximately 1,642 holders of record of D&B common stock and 14,313,500 shares of D&B common stock outstanding. Each share of D&B common stock entitles the holder to cast one vote at the special meeting.

      Any stockholder entitled to vote may vote either in person or by properly executed proxy. A quorum of D&B’s stockholders is required to be present to conduct any business at the special meeting. The presence, in person or by proxy, of the holders of a majority in voting power of the shares of D&B common stock outstanding on the record date is necessary to constitute a quorum at the special meeting. Abstentions and broker non-votes, if any, are counted for the purpose of establishing a quorum at the special meeting.

Voting Shares Held in Street Name at the Meeting

      If your broker, bank or other nominee holds D&B shares for you in “street name,” and you want to vote these shares in person at the special meeting, you must get a written proxy in your name from the broker, bank or other nominee who holds your shares.

Voting via the Internet or by Telephone

      Stockholders of record may vote their proxies via the Internet or by telephone. Internet and telephone voting is available 24 hours a day, 7 days a week, through 11:59 PM, Central Standard Time, on the day prior to the date of the special meeting. Your Internet or telephone vote authorizes the named proxies in the same manner as if you marked, signed and returned the proxy card. If you vote by Internet or telephone, you do not need to mail your proxy card.

      To vote your proxy via the Internet, go to: http://www.proxyvoting.com/dab. You should have your proxy card in hand when you access the website, and follow the instructions on the website. To vote by telephone, call the number on your proxy card using a touch-tone phone. You should have your proxy card in hand when you call, and follow the instructions. If your shares are held in “street name,” you should instruct your broker, bank or other nominee how to vote in accordance with the voting instruction form furnished by your broker, bank or other nominee.

Vote Required for Approval

      The merger agreement must be approved by the holders of at least two-thirds of the outstanding shares of D&B common stock as of the record date. The proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies for the approval of the merger agreement, requires a majority of the shares of D&B common stock entitled to vote at and represented in person or by proxy at the special meeting. Votes will be tabulated by D&B’s transfer agent, Mellon Investor Services LLC.

      If your shares are held in “street name” by your broker, bank or other nominee, you should instruct your broker, bank or other nominee how to vote your shares by following the directions your nominee provides to you. If you have not received these directions, or need more information, you should contact your broker, bank, or other nominee. Under the rules of the NYSE, brokers who hold shares in “street name” for customers may not exercise their voting discretion with respect to approval of non-routine matters such as the merger agreement, and thus, absent specific instructions from the beneficial owner, brokers are not entitled to vote the shares for or against the merger. Shares of D&B common stock held by persons attending the special meeting but not voting, or shares for which we have received proxies with respect to which voters have abstained from voting, will be considered “abstentions.” Abstentions and broker non-votes will have the effect of a vote “AGAINST” approval of the merger agreement. Abstentions will have the effect of a vote “AGAINST” the proposal to adjourn the special meeting, if necessary. Broker non-votes, if any, will have no effect on the outcome of the proposal to adjourn the special meeting, if necessary.

      Four D&B stockholders, who are also directors and executive officers of D&B, entered into a voting agreement in conjunction with the execution of the merger agreement, which obligates them to vote their shares of common stock “FOR” the merger agreement. In January 2006, HBK Investments L.P. entered into a voting agreement with Midway in which it agreed to vote its shares of common stock “FOR” the merger agreement. As of the record date, the stockholders subject to the voting agreements with Midway were entitled to vote an aggregate of 2,409,702 shares, or approximately 16.8% of all outstanding D&B shares on the record date. See “Security Ownership of Certain Beneficial Owners and Management.” We currently expect that all of the directors and executive officers of D&B will vote all of their shares “FOR” the merger agreement. As of the record date, D&B’s directors and executive officers were entitled to vote an aggregate of 1,422,090 shares, or 9.9% of all outstanding D&B shares.

Voting and Revocation of Proxies

      All shares of D&B common stock represented by properly executed proxies received prior to or at the special meeting and not revoked will be voted in accordance with the instructions indicated in those proxies. If no instructions are indicated on a returned proxy, the proxy will be voted “FOR” the proposal to approve the merger agreement and “FOR” the proposal to approve the adjournment of the special meeting, if necessary or appropriate, to solicit additional proxies for the approval of the merger agreement.

      You may revoke a proxy by:

      Revocation of a proxy after the vote at the special meeting will not affect the vote previously taken. Attendance at the special meeting will not in itself constitute the revocation of a proxy; stockholders must vote in person at the special meeting to revoke an existing proxy.

Solicitation of Proxies; Expenses of Solicitation

      This solicitation is being made by the board of directors of D&B and the expenses of the solicitation will be borne by D&B. The principal solicitation is being made by mail; however, additional solicitations may be made by telephone or personal interview by officers of D&B or employees of Georgeson Shareholder Communications, Inc., our proxy solicitor. D&B has agreed to pay Georgeson a base fee of $10,000 plus out of pocket expenses. In the event that D&B authorizes Georgeson to solicit beneficial owners that hold D&B shares in “street name,” D&B will pay Georgeson an additional fee of $5.00 for each holder solicited. D&B also expects to reimburse brokerage houses, banks and other fiduciaries for reasonable expenses of forwarding proxy materials to beneficial owners.

Other Matters for Action at the Special Meeting

      D&B’s board of directors is not aware of any matters to be presented for action at the special meeting other than those described in this proxy statement and does not intend to bring any other matters before the special meeting.

PARTIES TO THE MERGER

Dave & Buster’s, Inc.

      Dave & Buster’s, Inc., a Missouri corporation, operates large format, high-volume restaurant/entertainment complexes under the Dave & Buster’s^® name. As of December 31, 2005, D&B operated 46 entertainment complexes across the United States and Canada. In the fourth quarter of fiscal 2004, D&B acquired out of bankruptcy, the operating assets of certain restaurant/entertainment complexes operating under the trade name Jillian’s^®, which have operations similar to a traditional Dave & Buster’s and are located in major metropolitan areas. D&B is in the process of converting each of the prior Jillian’s into an entertainment complex that will operate as a Dave & Buster’s or Dave & Buster’s Grand Sports Café.

      Each Dave & Buster’s entertainment complex offers a full menu of high-quality food and beverage items combined with an extensive array of entertainment attractions such as pocket billiards, shuffleboard, state-of-the-art interactive simulators and virtual reality systems, and traditional carnival-style games of skill. These entertainment complexes range in size from 30,000 to 70,000 square feet. D&B’s entertainment complexes operate seven days a week and are typically open from 11:30 a.m. to 12:00 a.m. on weekdays and 11:30 a.m. to 2:00 a.m. on weekends.

WS Midway Holdings, Inc.

      WS Midway Holdings, Inc., a Delaware corporation and an affiliate of Wellspring Capital Management LLC, was formed solely for the purpose of effecting the merger and the transactions related to the merger. It has not engaged in any business except in furtherance of this purpose.

      Wellspring is a New York-based private equity firm with more than $2 billion in equity capital under management. The firm takes controlling positions in promising middle-market companies where it can realize substantial value by contributing innovative operating and financing strategies and capital. Wellspring’s limited partners include some of the largest and most respected institutional investors in the U.S., Canada, and Europe. The firm consistently ranks among the top-performing private equity funds specializing in the middle market.

WS Midway Acquisition Sub, Inc.

      WS Midway Acquisition Sub, Inc., a Missouri corporation and a direct, wholly-owned subsidiary of Midway, was formed solely for the purpose of effecting the merger and the transactions related to the merger. It has not engaged in any business except in furtherance of this purpose.

THE MERGER

      The following information describes the material aspects of the merger. This description is qualified in its entirety by reference to the appendices to this proxy statement, including the merger agreement itself, which is attached to this proxy statement as Appendix A and is incorporated herein by reference. You are urged to read Appendix A in its entirety. See also “The Merger Agreement” below.

Effective Time of the Merger

      If the conditions to the merger are satisfied or, to the extent permitted by law and the merger agreement, waived, the merger will be consummated and become effective at the time that articles of merger are filed with the Secretary of State of the State of Missouri or such later time as otherwise agreed by D&B and Midway and provided in the articles of merger. If the other conditions to the merger are satisfied or, to the extent permitted by law and the merger agreement, waived, D&B expects to complete the merger as soon as practicable after approval of the merger agreement by D&B stockholders at the special meeting.

Payment of Merger Consideration and Surrender of Stock Certificates

      Mellon Investor Services LLC has been designated to act as exchange agent for purposes of making the cash payments provided by the merger agreement. From time to time after the effective time of the merger, Midway will, when and as required, deposit, or cause to be deposited, with the exchange agent immediately available funds in an aggregate amount necessary to pay the $18.05 per share merger consideration to D&B’s stockholders. The exchange agent will use these funds for the sole purpose of paying the merger consideration to D&B’s stockholders entitled to receive payment of the merger consideration. The exchange agent will, in accordance with irrevocable instructions, deliver to you your merger consideration according to the procedure summarized below.

      As soon as reasonably practicable after the effective time of the merger, D&B will instruct the exchange agent to mail to you a letter of transmittal and instructions advising you of the effectiveness of the merger and the procedure for surrendering to the exchange agent your stock certificates in exchange for payment of the $18.05 per share merger consideration. Upon the surrender for cancellation to the exchange agent of your stock certificates, together with a letter of transmittal, duly executed and completed in accordance with its instructions, and any other items specified by the letter of transmittal, the exchange agent will pay to you the $18.05 per share merger consideration in cash and your stock certificates will be canceled. No interest will be paid or accrued on the merger consideration. Payments of merger consideration also will be reduced by any applicable withholding taxes.

      If your stock certificates have been lost, mutilated or destroyed, you may instead deliver to the exchange agent an affidavit and indemnity bond in form and substance, and with surety, reasonably satisfactory to the surviving corporation.

      If the merger consideration, or any portion of it, is to be paid to a person other than you, it will be a condition to the payment of the merger consideration that your stock certificates be properly endorsed or otherwise in proper form for transfer and that you pay to the exchange agent any transfer or other taxes required by reason of the transfer or establish to the satisfaction of D&B that the taxes have been paid or are not required to be paid.

      You should not forward your stock certificates to the exchange agent without a letter of transmittal, and you should not return your stock certificates with the enclosed proxy.

      From and after the effective time of the merger, you will cease to have any rights as a D&B stockholder, except for the right to surrender your stock certificates, according to the procedure described in this section, in exchange for payment of the $18.05 per share merger consideration, without interest and less any applicable withholding taxes, or, if you exercise your appraisal rights, the right to perfect your right to receive payment for your shares under Missouri law.

      At the effective time of the merger, D&B’s stock ledger with respect to shares of D&B common stock that were outstanding prior to the merger will be closed and no further registration of transfers of these shares will be made.

      After six months following the effective time of the merger, the exchange agent will, on demand, deliver to the surviving corporation all cash that has not yet been distributed in payment of the merger consideration, plus any accrued interest, and the exchange agent’s duties will terminate. Thereafter, you may surrender your stock certificates to the surviving corporation and receive the $18.05 per share merger consideration, without interest, less any applicable withholding taxes. However, you will have no greater rights against the surviving corporation than may be accorded to general creditors of the surviving corporation under applicable law.

      None of Midway, D&B or Merger Sub will be liable to you for any merger consideration delivered to a public official under any applicable abandoned property, escheat or similar law.

Background of the Merger

      On September 16, 2005, Greg S. Feldman, a managing partner of Wellspring, contacted Buster Corley, D&B’s chief executive officer, and told him that he had been following developments at D&B as indicated in its publicly available filings. During the course of this discussion, Mr. Feldman asked Mr. Corley if D&B would be interested in discussing a potential acquisition of D&B by a Wellspring affiliate. Mr. Corley told Mr. Feldman that he was currently attending to the opening of D&B’s new Kansas City location and requested that they continue this call at a later date. Mr. Feldman then contacted Mr. Corley later in October 2005 and initiated the discussion of a potential business combination. Mr. Corley responded by stating that Wellspring should contact Peter Edison, D&B’s chairman of the board, if Wellspring had any interest in discussing a potential business combination.

      The board of directors of D&B was not in the process of pursuing any strategic acquisitions or other potential strategic options at the time of Wellspring’s contact in October 2005, and D&B’s management was focused primarily on creating value through its existing operations. D&B had no prior relationship with Wellspring, except that in November 2000, D&B had received an inquiry from Wellspring, expressing interest in exploring a possible acquisition of D&B. In connection with this inquiry, Wellspring executed a confidentiality agreement with D&B and conducted due diligence; however, Wellspring never made any definitive offer or written proposal to D&B. These discussions ceased in September 2001, due in part to the terrorist attacks that occurred on September 11th of that year. D&B did not have any further discussions or negotiations with Wellspring over the succeeding four years, until Mr. Feldman’s contact in October 2005.

      On October 31, 2005, Wellspring sent a letter to D&B, addressed to Mr. Edison. The letter included a preliminary proposal whereby an affiliate of Wellspring would acquire D&B at a proposed merger price of $17.50 per share in cash. The letter contemplated that Wellspring’s offer would be subject to a due diligence review of D&B that Wellspring believed could be completed within 45 days. The letter further contemplated that D&B would commit not to undertake discussions or negotiations with any other party regarding a business combination for a 45 day period. Wellspring also provided Mr. Edison with a proposed form of merger agreement and a financing commitment from JPMorgan Chase Bank, N.A. for the debt financing required to complete the merger. Wellspring’s proposal also contemplated a termination fee of $11,400,000 and the reimbursement of up to $3,500,000 in Wellspring’s expenses upon termination of the merger agreement by D&B. Finally, Wellspring advised Mr. Edison that it would commit to provide the equity financing required to complete the merger.

      During early November, Mr. Edison informally advised certain of the board members that he had received Wellspring’s preliminary proposal and proceeded to set up a special meeting of the board of directors of D&B. Prior to the meeting, Mr. Edison advised Mr. Feldman that the board would be meeting on November 15 and that he believed it would be important for Mr. Feldman to indicate Wellspring’s ability to increase the proposed merger consideration. Mr. Feldman told Mr. Edison that Wellspring would

consider increasing its preliminary proposal, depending upon the results of its due diligence investigation of D&B.

      At a meeting held on November 15, the board discussed the October 31 preliminary proposal letter in detail. During this meeting, the board also focused particularly on the anticipated results of operations for D&B’s third fiscal quarter recently completed on October 30. Management advised the board that it expected results of operations for the third quarter to fall significantly short of prevailing analysts’ estimates, as was the case with the second quarter, and that it was scheduled to announce these results on December 9. The board noted that Wellspring was not yet aware of the third quarter results. The board assessed the likely drop in D&B’s market capitalization that could be expected to follow the reporting of these financial results. The board determined that this drop in market capitalization could preclude the consummation of a business combination at the price level indicated in Wellspring’s preliminary proposal, based on the belief that financial buyers are generally constrained in the level of premium over current trading price that they are willing to pay in business combinations. The board also discussed the difficulties associated with regaining investor confidence if D&B were to remain as an independent, publicly traded company, and also considered the challenges of pursuing other strategic alternatives if the stock price were to decline materially. The board of directors determined that the Wellspring proposal, if it could be reduced to a definitive agreement prior to December 9, offered a unique opportunity to achieve significant stockholder value that might not be available for a significant period of time if the D&B stock price were to decline to the extent anticipated. In making this determination, the board noted that Wellspring had already secured financing commitments to complete the transaction and had submitted a draft of a merger agreement that could reasonably be expected to be finalized prior to December 9. The board recognized that it would be unlikely for any other prospective buyer to meet the December 9 timetable. The board also discussed in great detail the desirability for a “market check” or “limited auction” prior to the execution of a definitive merger agreement that would allow the board the opportunity to test the adequacy of the merger consideration being offered by Wellspring. Although the board recognized that such steps are generally helpful to ensure the highest merger consideration, the board also noted that any delays in pursuing the Wellspring proposal would jeopardize the likelihood that it could be finalized prior to December 9 and could have a negative impact on the proposed purchase price offered by Wellspring. The board also determined that any potential benefits from a “market check” prior to the execution of a definitive merger agreement were outweighed by its desire to minimize, to the greatest extent possible, the risk of unwanted public disclosure concerning the possibility of a transaction in order to avoid the destabilizing effect that such leaks invariably have on relationships with employees and suppliers. In light of those considerations, the board concluded that the preliminary proposal made by Wellspring warranted its decision to negotiate solely with Wellspring without conducting a pre-signing market check or auction. The board determined to proceed with Wellspring and commence a dialogue, although the board recognized that an outside investment banker would have to render a fairness opinion and advise the board in connection with the Wellspring or any subsequent proposal.

      Accordingly, D&B’s board of directors decided that it would be prepared to allow Wellspring to conduct due diligence regarding D&B and to execute an exclusivity letter. The board determined at the meeting that no special committee of the board was required to evaluate or negotiate a potential transaction since no member of the board or management had a conflict of interest with respect to the transaction. In order to achieve some administrative efficiencies however, the board appointed Mr. Edison and Mr. Pittaway to act as an ad hoc committee to retain a financial advisor for the board in connection with the potential transaction and to represent the board in negotiations with Wellspring. The board instructed Mr. Edison to contact Mr. Feldman and advise him of the board’s decision and indicate to Mr. Feldman the board’s desire to increase the merger consideration. Mr. Edison contacted Mr. Feldman on November 16 to advise him of the board’s desire to proceed with negotiations. Mr. Edison invited Wellspring representatives to come to D&B’s headquarters in Dallas on November 17 for the purpose of commencing financial due diligence. Prior to the meeting, Wellspring and D&B executed the confidentiality agreement and exclusivity letter.

      On November 18, Wellspring representatives participated in a conference call with D&B’s management to review historical and projected results of operations and to discuss operational issues.

      On November 21, Mr. Feldman called Mr. Edison to indicate that, based upon its preliminary financial due diligence, Wellspring was not prepared to increase the merger consideration, but was willing to continue its due diligence investigation at its originally offered price of $17.50 per share. Mr. Edison advised Mr. Feldman that the board had already decided at its November 15 meeting that the $17.50 per share price was not adequate. Mr. Feldman then requested that Mr. Edison and Mr. Pittaway informally poll board members to inquire as to whether it would consider an offer of $18.00 per share. Mr. Edison agreed to do so and thereafter advised Mr. Feldman that the board would assess the revised preliminary proposal and the status of the transaction at a meeting to be held on December 1.

      On November 23, D&B retained Piper Jaffray as its financial advisor and promptly proceeded to share D&B’s historical and projected financial information with Piper Jaffray. At the same time, representatives of Skadden, Arps, Slate, Meagher & Flom LLP, Wellspring’s legal advisor, commenced legal due diligence.

      On November 28, Wellspring met with D&B’s management at D&B headquarters in Dallas, Texas to further discuss historical and projected results of operations and to discuss operational issues. During the meeting, D&B’s management provided Wellspring with forecasted results for the 2006 fiscal year, including projected total revenues of approximately $516 million, EBITDA of approximately $74 million, operating income of approximately $25 million, and net income of approximately $12 million.

      On November 29, Wellspring brought representatives of J.P. Morgan Securities Inc. to D&B headquarters in Dallas, Texas to conduct additional financial due diligence with D&B and Piper Jaffray.

      Wellspring and its legal and financial advisors thereafter continued their due diligence investigation of D&B and continued the negotiation of the merger agreement with Hallett & Perrin, P.C., D&B’s legal advisors. D&B convened a meeting of its board of directors on December 1. At this meeting, D&B’s counsel reviewed the merger agreement with the board of directors and summarized the issues which had been resolved and the issues which remained to be resolved. Counsel advised the board that although Wellspring had agreed to reduce the termination fee in the merger agreement and to reduce the scope of events under which a termination fee was to become payable, further reductions in the size of the termination fee were desirable. The board of directors asked Piper Jaffray to describe its expertise in the area of restaurant mergers and acquisitions. Piper Jaffray then discussed Wellspring’s financing commitments and generally presented its financial analysis of the proposed $18.00 merger price. Piper Jaffray indicated that, subject to the completion of its work and the review of its internal committee, it anticipated it would be able to render a fairness opinion based on an $18.00 per share merger consideration.

      On December 2, Mr. Edison advised Mr. Feldman that the board authorized proceeding with the merger agreement, provided that there was an increase in the merger consideration and a reduction in the termination fee. On December 5, Mr. Feldman advised Mr. Edison that Wellspring would be prepared to increase the merger consideration to $18.05 per share and to reduce the termination fee to $10,175,000.

      From December 2 through December 8, the parties continued to negotiate the terms of the merger agreement and to complete the due diligence investigation of D&B.

      On December 5, Skadden, Arps, Slate, Meagher & Flom LLP delivered a draft of the voting agreement to counsel for D&B, whereby Messrs. Corriveau, Corley, Hammett and Smith would agree to vote their shares in favor of the proposed merger and against any alternative transaction proposals.

      On December 8, D&B’s board of directors met with its financial and legal advisors to consider the proposed transaction and the merger agreement. D&B’s legal counsel updated the board regarding the negotiations which had occurred since the December 1 meeting with respect to both the merger agreement and the voting agreement. Piper Jaffray provided the board with its financial analysis of the proposed transaction. Piper Jaffray explained the different valuation methodologies employed by it, including a

market trading analysis, a market multiple analysis, a comparable transaction analysis and a discounted cash flow analysis, in reaching its opinion. Piper Jaffray’s market multiple and comparable transaction analysis included both EBITDA and EBIT multiples due to D&B’s historically high capital expenditure requirements. Piper Jaffray then rendered its oral opinion (subsequently confirmed in writing) to the board to the effect that, as of the date of such opinion, and on the basis of its analysis and subject to the qualifications, assumptions and limitations set forth in its opinion, the $18.05 per share merger consideration to be received by the stockholders of D&B in the merger was fair to them from a financial point of view.

      The board specifically noted that, since D&B’s annual capital expenditure requirements were higher than restaurant companies which might otherwise be viewed as comparable to D&B, the EBITDA multiples used in the traditional analysis of business valuations did not adequately measure the merger consideration as a multiple of D&B’s “free cash flow.” The board therefore determined to analyze the proposed merger consideration based upon EBIT multiples, as well as EBITDA multiples, for D&B and comparable companies in order to provide an additional data point for its review of the transaction and to recognize the significant capital expenditure requirements of D&B’s business. The board proceeded to discuss certain provisions of the merger agreement and, in particular, the fact that D&B’s board of directors will continue to have the right to respond, under certain circumstances, to third parties that subsequently might make an acquisition proposal that provides a higher per share price to the stockholders of D&B, subject to the terms of the merger agreement.

      Following discussion among the board and after consideration of the opinion of Piper Jaffray, the board unanimously:

      On December 8, after the approval of D&B’s board of directors, the parties signed the merger agreement. In connection with the execution of the merger agreement, Messrs. Corriveau, Corley, Hammett and Smith signed the voting agreement with Midway. A press release announcing the signing of the merger agreement was issued on December 8, 2005.

Fairness Opinion of Piper Jaffray

      D&B retained Piper Jaffray to act as its financial advisor, and if requested, to render to D&B’s board of directors an opinion as to the fairness, from a financial point of view, of the merger consideration to be received by D&B’s stockholders pursuant to the merger agreement.

      On December 8, 2005, D&B’s board of directors met to review the proposed merger. During this meeting, Piper Jaffray reviewed with D&B’s board of directors certain financial analyses, which are summarized below. Also at this meeting, Piper Jaffray delivered its oral opinion to D&B’s board of directors, which was subsequently confirmed in writing, to the effect that, as of December 8, 2005, and based upon and subject to the factors, assumptions and limitations set forth in its opinion, the $18.05 per share cash merger consideration proposed to be paid by affiliates of Wellspring pursuant to the merger agreement was fair, from a financial point of view, to D&B’s stockholders.

      The full text of the opinion, which sets forth, among other things, the assumptions made, procedures followed, matters considered and limitations on the scope of the review undertaken by Piper Jaffray in rendering its opinion, is attached to this proxy statement as Appendix B and is incorporated in its entirety herein by reference. You are urged to, and should, carefully read the opinion in its entirety. The opinion addresses only the fairness, from a financial point of view and as of the date of the opinion, of the merger consideration to D&B’s stockholders. The opinion was addressed to D&B’s board of directors and was not

intended to be, and does not constitute, a recommendation as to how any stockholder should vote or act on any matter relating to the proposed merger.

      In arriving at its opinion, Piper Jaffray, among other things, reviewed:

      In addition, Piper Jaffray performed a discounted cash flow analysis for D&B on a stand-alone basis. Piper Jaffray also conducted discussions with members of the senior management of D&B concerning the financial condition, historical and current operating results, business and prospects of D&B on a stand-alone basis.

      The following is a summary of the material financial analyses performed by Piper Jaffray in connection with the preparation of its fairness opinion. The preparation of analyses and a fairness opinion is a complex analytic process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, this summary does not purport to be a complete description of the analyses performed by Piper Jaffray or of its presentation to D&B’s board of directors on December 8, 2005.

      This summary includes information presented in tabular format, which tables must be read together with the corresponding text, and considered as a whole, in order to fully understand the financial analyses presented by Piper Jaffray. The tables alone do not constitute a complete summary of the financial analyses. The order in which these analyses are presented below, and the results of those analyses, should not be taken as any indication of the relative importance or weight given to these analyses by Piper Jaffray or D&B’s board of directors. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before December 7, 2005, and is not necessarily indicative of current market conditions.

      Piper Jaffray reviewed the financial terms of the proposed transaction, including the merger consideration. Based on a price of $18.05 per share in cash for D&B’s common stock, the implied fully diluted equity value for D&B was $316.2 million and the implied enterprise value of D&B (as of the fiscal quarter ended October 30, 2005) was approximately $375.4 million. The “enterprise value” is the sum of the fully diluted market value of any common equity plus any short-term and long-term debt, minus cash and cash equivalents.

      Piper Jaffray reviewed selected market information concerning D&B’s common stock. Among other things, Piper Jaffray noted the following with respect to the trading prices of D&B’s common stock:

      Piper Jaffray’s analysis concerning D&B’s common stock was based on information concerning D&B and its common stock available as of December 7, 2005. Piper Jaffray did not and does not express any opinion as to the prices at which D&B’s common stock may trade following the announcement of the merger proposal or at any time in the future.

      Piper Jaffray reviewed selected financial data for D&B and compared this to corresponding data for selected publicly traded companies that are in the restaurant industry and which Piper Jaffray believes are comparable to D&B. Piper Jaffray selected these companies based on information obtained by searching SEC filings, public company disclosures, press releases, industry and popular press reports, databases and other sources. Piper Jaffray identified and analyzed nine comparable companies:

      The financial data analyzed as part of this analysis included, among other things:

      This analysis showed that, based on the estimates and assumptions used in the analysis, the enterprise value of D&B implied by the merger consideration set forth in the merger agreement was within the range of values of the comparable companies.

      Piper Jaffray reviewed selected financial data for D&B and compared this to corresponding data from the following group of 27 selected restaurant industry merger and acquisition transactions (all of which were announced after January 1, 2000).

      The financial data analyzed as part of this analysis included, among other things:

      This analysis showed that, based on the estimates and assumptions used in the analysis, the enterprise value of D&B was within the range of values of the comparable transactions.

      Piper Jaffray reviewed selected financial data for D&B and compared this to corresponding data from the following group of 13 restaurant industry public buyout transactions (all of which were announced after January 1, 2000).

      The financial data analyzed as part of this analysis included, among other things:

      This analysis showed that, based on the estimates and assumptions used in the analysis, the enterprise value of D&B was within the range of values of the comparable public buyout transactions.

      Piper Jaffray reviewed publicly available information for selected completed or pending public buyout transactions to determine the premiums paid in the transactions over recent trading prices of the target

companies prior to announcement of the transaction. Piper Jaffray selected these transactions by searching SEC filings, public company disclosures, press releases, industry and popular press reports, databases and other sources and by applying the following criteria:

      Piper Jaffray performed its analysis on 58 transactions that satisfied the criteria, and the table below shows comparison of premiums paid in these transactions to the premium that would be paid to D&B’s stockholders based on the per share merger consideration.

      Using a discounted cash flow analysis, Piper Jaffray calculated a range of theoretical enterprise values for D&B based on (1) the net present value of implied annual cash flows of D&B during the fiscal 2006 through the fiscal 2010 time frame and (2) the net present value of a terminal value, which is an estimate of the future value of D&B at the end of the fiscal year 2010 based upon a multiple of EBITDA. Piper Jaffray used forecasts of results for fiscal 2006 furnished to Piper Jaffray by management and forecasts of results for fiscal years 2007 through 2010 prepared using certain assumptions furnished to Piper Jaffray by management. Piper Jaffray calculated the range of net present values based on an assumed tax rate of 36.5%, a range of discount rates of 16% to 20% and a range of EBITDA multiples for a terminal value of 5.5x to 6.5x applied to the projected fiscal year 2010 EBITDA. This analysis resulted in an implied per share value of D&B ranging from a low of $14.88 to a high of $20.94.

      The summary set forth above does not contain a complete description of the analyses performed by Piper Jaffray but does summarize the material analyses performed by Piper Jaffray in rendering its opinion. The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Piper Jaffray believes that its analyses and the summary set forth above must be considered as a whole and that selecting portions of its analyses or of the summary, without considering the analyses as a whole or all of the factors included in its analyses, would create an incomplete view of the processes underlying the analyses set forth in the Piper Jaffray opinion. In arriving at its opinion, Piper Jaffray considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Instead, Piper Jaffray made its determination as to fairness on the basis of its experience and financial judgment after considering the results of all of its analyses. The fact that any specific analysis has been referred to in the summary above is not meant to indicate that this analysis was given greater weight than any other analysis. No company or transaction used in the above analyses as a comparison is directly comparable to D&B or the proposed merger.

      The analyses were prepared solely for purposes of Piper Jaffray providing its opinion to D&B’s board of directors that the merger consideration set forth in the merger agreement was fair, from a financial point of view, to D&B’s stockholders as of the date of the opinion. In performing its analyses, Piper Jaffray made numerous assumptions with respect to industry performance, general business and economic conditions and other matters. The analyses performed by Piper Jaffray are based upon forecasts of future

results furnished to Piper Jaffray by management of D&B, which are not necessarily indicative of actual values or actual future results and may be significantly more or less favorable than suggested by these analyses. These analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors. Piper Jaffray does not assume responsibility if future results are materially different from those forecasted.

      Piper Jaffray’s opinion to D&B’s board of directors was one of many factors taken into consideration by D&B’s board of directors in making its determination to approve the merger agreement. The above summary does not purport to be a complete description of the analyses performed by Piper Jaffray in connection with the opinion and is qualified by reference to the written opinion of Piper Jaffray attached to this proxy statement.

      Piper Jaffray relied upon and assumed the accuracy, completeness and fairness of the financial, accounting and other information provided to it by D&B or otherwise made available to it, and did not independently verify this information. Piper Jaffray also assumed, in reliance upon the assurances of the management of D&B, that the information provided to Piper Jaffray by D&B was prepared on a reasonable basis in accordance with industry practice and, with respect to financial forecasts, projections and other estimates and other business outlook information, reflected the best currently available estimates and judgments of the management of D&B, is based on reasonable assumptions, and that there is not, and the management of D&B was not aware of, any information or facts that would make the information provided to Piper Jaffray incomplete or misleading. Piper Jaffray expresses no opinion as to such financial forecasts, projections and other estimates and other business outlook information or the assumptions on which they are based. Piper Jaffray relied, with D&B’s consent, on advice of D&B’s outside counsel and the independent accountants to D&B, and on the assumptions of the management of D&B, as to all accounting, legal, tax and financial reporting matters with respect to D&B and the merger agreement. Without limiting the generality of the foregoing, Piper Jaffray assumed that D&B was not a party to any material pending transaction, including any external financing, recapitalization, acquisition or merger, divestiture or spinoff, other than the proposed merger.

      Piper Jaffray assumed that the merger would be completed on the terms set forth in the merger agreement reviewed by Piper Jaffray, without amendments and with full satisfaction of all covenants and conditions without any waiver. Piper Jaffray has also assumed that all necessary regulatory approvals and consents required for the merger will be obtained in a manner that will not result in the disposition of any material portion of the assets of D&B, or otherwise adversely affect D&B, and that will not alter the terms of the merger agreement.

      Piper Jaffray did not assume responsibility for performing, and did not perform, any appraisals or valuations of specific assets or liabilities of D&B and was not furnished with any appraisals or valuations. Piper Jaffray expresses no opinion regarding the liquidation value or solvency of any entity. Piper Jaffray did not undertake any independent analysis of any outstanding, pending or threatened litigation, regulatory action, possible unasserted claims or other contingent liabilities to which D&B, or any of its respective affiliates is a party or may be subject. At the direction of D&B’s board of directors, and with its consent, Piper Jaffray’s opinion made no assumption concerning, and therefore did not consider, the potential effects of litigation, claims, investigations, or possible assertions of claims, or the outcomes or damages arising out of any such matters.

      Piper Jaffray’s opinion was necessarily based on the information available to it, the facts and circumstances as they existed and were subject to evaluation as of the date of the opinion; events occurring after the date of the opinion could materially affect the assumptions used by Piper Jaffray in preparing its opinion. Piper Jaffray expresses no opinion as to the prices at which shares of D&B’s common stock have traded or may trade following announcement of the merger or at any future time after the date of the opinion. Piper Jaffray has not undertaken and is not obligated to affirm or revise its opinion or otherwise comment on any events occurring after the date it was given.

      In connection with its engagement, Piper Jaffray was not requested to solicit indications of interest from, or hold discussions with, any third parties regarding the possible acquisition of all or part of D&B by

those third parties. Piper Jaffray was not requested to opine as to, and the opinion does not address, the basic business decision to proceed with or effect the merger, or the relative merits of the merger compared to any alternative business strategy or transaction in which D&B might engage. Piper Jaffray did not express any opinion as to whether any alternative transaction might produce consideration for D&B’s stockholders in excess of the merger consideration.

      Piper Jaffray is a nationally recognized investment banking firm and is regularly engaged as a financial advisor in connection with mergers and acquisitions, underwritings and secondary distributions of securities and private placements. D&B’s board of directors selected Piper Jaffray to render its fairness opinion in connection with the proposed merger on the basis of its experience and reputation in acting as a financial advisor in connection with mergers and acquisitions.

      Piper Jaffray acted as financial advisor to D&B in connection with the merger and will receive a fee from D&B for its services upon consummation of the merger. A substantial portion of Piper Jaffray’s fee is contingent upon the consummation of the merger. Piper Jaffray also received a fee of $200,000 from D&B for providing its opinion, which will be credited against the fee for financial advisory services. This opinion fee is not contingent upon the consummation of the merger. D&B has also agreed to indemnify Piper Jaffray against certain liabilities in connection with its services and to reimburse it for certain expenses in connection with its services. In the ordinary course of its business, Piper Jaffray and its affiliates may actively trade securities of D&B for its own account or the accounts of its customers and, accordingly, Piper Jaffray may at any time hold a long or short position in such securities. Piper Jaffray has provided investment banking services to D&B in the past on unrelated transactions, for which it has received customary fees, including acting as an advisor in the November 1, 2004 acquisition by D&B of certain assets of Jillian’s Entertainment Holdings Inc.

Reasons for the Merger

      In reaching its decision to approve the merger agreement, the merger and the other transactions contemplated by the merger agreement, and to recommend that our stockholders vote to approve the merger agreement, the D&B board of directors consulted with management and its financial and legal advisors. The board of directors considered the following factors and potential benefits of the merger, each of which it believed supported its decision:

      The board of directors also considered the following risks and other countervailing factors:

      After taking into account all of the factors set forth above, as well as others, the board of directors determined that the potential benefits of the merger outweigh the potential risks and that the merger agreement and the transactions contemplated by the merger agreement are advisable, fair to and in the best interests of D&B and its stockholders. The board of directors has unanimously approved the merger agreement and the merger and recommends that you vote “FOR” the proposal to approve the merger agreement. The foregoing discussion of the factors considered by the board of directors is not intended to be exhaustive, but rather includes the material factors considered by the board of directors. The board of

directors did not assign relative weights to the above factors or the other factors considered by it. In addition, the board of directors did not reach any specific conclusion on each factor considered but, with the assistance of its advisors, conducted an overall analysis of these factors. Individual members of the board of directors may have given different weights to different factors.

Recommendation of Our Board of Directors; Fairness of the Merger

      After careful consideration, our board of directors, by unanimous vote:

Certain U.S. Federal Income Tax Consequences of the Merger to D&B’s Stockholders

      The following is a summary of certain U.S. federal income tax consequences of the merger to holders of shares of D&B common stock, which we refer to as the “Shares” in this summary, whose Shares are exchanged for cash in the merger. This discussion is for general information only and does not purport to consider all aspects of U.S. federal income taxation that might be relevant to stockholders of D&B. The discussion is based on current provisions of the Internal Revenue Code of 1986, as amended, which we refer to as the “Code,” temporary, proposed and final regulations promulgated thereunder and administrative and judicial interpretations thereof, all of which are subject to change, possibly with a retroactive effect. This discussion applies only to stockholders of D&B who hold the Shares as capital assets within the meaning of Section 1221 of the Code. This discussion does not apply to Shares received pursuant to the exercise of employee stock options, warrants or otherwise as compensation or following the conversion of a note or other financial instrument, or to stockholders who constructively own stock of D&B following the merger under Section 302 of the Code. In addition, the discussion does not apply to certain types of stockholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules or to any stockholder of D&B who, for U.S. federal income tax purposes, is a non-resident alien-individual, a foreign corporation, a foreign partnership or a foreign estate or trust. Finally, this discussion does not consider the effect of any foreign, state or local tax laws.

      Because individual circumstances may differ, each stockholder should consult his own tax advisor to determine the applicability of the rules discussed herein and the particular tax effects of the merger to him, including the application and effect of the alternative minimum tax, and any state, local and foreign tax laws.

      The exchange of Shares for cash pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. A stockholder who receives cash in exchange for Shares will recognize gain or loss in an amount equal to the difference, if any, between the amount of cash received and the stockholder’s adjusted tax basis in the shares surrendered. Such gain or loss will be long-term capital gain or loss if the stockholder’s holding period for such Shares is more than one year. Certain limitations apply to the use of a stockholder’s capital losses.

Accounting Treatment

      The merger will be accounted for under the purchase method of accounting under which the total consideration paid in the merger will be allocated among D&B’s consolidated assets and liabilities based on the fair values of the assets acquired and liabilities assumed.

Fees and Expenses of the Merger

      D&B’s estimated fees and expenses in connection with the merger are set forth in the table below:

      The merger agreement provides that each party will pay all costs and expenses incurred by it in connection with the merger, other than upon a termination of the merger agreement under specified circumstances under which D&B must pay Midway’s costs and expenses up to $3,000,000. None of these costs and expenses will reduce the $18.05 per share merger consideration to be received by the stockholders.

Regulatory Approvals

      State Takeover Statutes. A number of states (including Missouri, where D&B is incorporated) have adopted laws which purport, to varying degrees, to apply to attempts to acquire corporations that are incorporated in, or which have substantial assets, stockholders, principal executive offices or principal places of business or whose business operations otherwise have substantial economic effects in, such states. To the extent that a state takeover statute purports to apply to the merger, D&B has agreed to take all actions necessary to exempt the merger from such statute.

      Antitrust in the United States. Under the Hart-Scott-Rodino Act and the rules that have been promulgated thereunder by the Federal Trade Commission, certain acquisition transactions may not be consummated unless certain information has been furnished to the Antitrust Division of the Department of Justice and the Federal Trade Commission and certain waiting period requirements have been satisfied. On January 17, 2006, D&B and Wellspring through Midway filed Hart-Scott-Rodino Act notification forms with the Department of Justice and the Federal Trade Commission. The applicable waiting period expires on February 16, 2006, unless earlier terminated.

      Liquor Licenses and Local Permits. D&B and Merger Sub are required to obtain consents, approvals or authorizations from the state, city and/or local liquor licensing boards or agencies in certain states in which D&B holds liquor licenses for the operation of its businesses. D&B and Merger Sub may be required to obtain related consents, approvals or authorizations from the state, city and/or local health, safety, fire or other municipal boards or agencies in such states including any consents for the conduct of amusement games. Certain of these approvals are required to be obtained prior to a change in control being effected, and it is a condition to Merger Sub’s obligation to consummate the merger that these approvals be obtained prior to the consummation of the merger. In addition, the surviving corporation will be required to make filings, send notices or give undertakings to certain additional liquor licensing agencies and/or other local agencies following consummation of the merger. The parties are seeking the required approvals, although there can be no assurance that the required approvals will be obtained in a timely manner or at all.

THE MERGER AGREEMENT

      The following is a summary of certain material provisions of the merger agreement, a copy of which is attached to this proxy statement as Appendix A, and which we incorporate by reference into this document. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. We encourage you to read carefully the merger agreement in its entirety.

      The merger agreement contains representations and warranties made by and to the parties to the merger agreement as of specific dates. The assertions embodied in those representations and warranties were made for purposes of the merger agreement and are subject to qualifications, limitations and exceptions agreed by the respective parties in connection with negotiating the terms of the merger agreement. In addition, certain representations and warranties were made as of a specified date, may be subject to a contractual standard of materiality different from what might be viewed as material to stockholders, or may have been used for the purpose of allocating risk between the respective parties rather than establishing matters as facts. For the foregoing reasons, you should not rely on the representations and warranties as statements of factual information at the time they were made or otherwise.

Structure

      Subject to the terms and conditions of the merger agreement, and in accordance with Missouri law, at the completion of the merger, Merger Sub, a Missouri corporation that is a direct, wholly-owned subsidiary of Midway, will merge with and into D&B. D&B will be the surviving company in the merger and continue to exist after the merger as a wholly-owned, privately held subsidiary of Midway. All of D&B’s and Merger Sub’s properties, assets, rights, privileges, immunities, powers and franchises, and all of their debts, liabilities and duties, will become those of the surviving corporation. D&B, as the surviving corporation, will continue its corporate existence under the laws of the State of Missouri.

      The merger agreement provides that the articles of incorporation of Merger Sub in effect immediately prior to the merger will be the articles of incorporation of D&B and that the bylaws of Merger Sub in effect immediately prior to the merger will be the bylaws of D&B (except that such articles of incorporation and bylaws will be amended to change the name of the surviving corporation to “Dave & Buster’s, Inc.”) until thereafter changed or amended as provided therein or by applicable law. The merger agreement also provides that the directors of Merger Sub at the time of the merger will be the directors of D&B until their respective successors are duly elected or appointed and qualified, and that the officers of D&B at the time of the merger will be the officers of D&B until their respective successors are duly elected or appointed and qualified.

Effective Time and Closing

      The merger will be completed and become effective when D&B and Merger Sub file articles of merger with the Secretary of State of the State of Missouri. The merger agreement contemplates that the closing will occur no later than the first business day following the date that all conditions to the merger are satisfied or waived.

Treatment of Stock, Warrants and Options

      At the effective time of the merger, each share of D&B common stock issued and outstanding immediately prior to the effective time of the merger will automatically be cancelled, will cease to exist, and will be converted into the right to receive $18.05 in cash, without interest, other than shares of D&B common stock:

      After the effective time of the merger, all shares of our common stock upon which merger consideration is payable shall automatically be cancelled and retired and cease to exist, and each of our outstanding stock certificates previously representing shares of common stock that were converted in the merger will represent only the right to receive the merger consideration without any interest and less any required withholding taxes. The merger consideration paid upon surrender of each certificate will be paid in full satisfaction of all rights pertaining to the shares of our common stock represented by that certificate.

      At the effective time of the merger, each warrant to purchase D&B common stock issued and outstanding immediately prior to the effective time of the merger will automatically be converted into the right to receive a new warrant from the surviving corporation, entitling the holder to receive, upon exercise and payment of the exercise price, an amount in cash equal to the product of (A) $18.05, and (B) the number of shares of D&B common stock into which the warrant was exercisable immediately prior to the merger, without interest. Upon conversion of the old warrants into the new warrants at the effective time of the merger, the old warrants shall automatically be cancelled and retired, and each warrant certificate previously representing an old warrant shall only represent the right to receive the new warrant. The issuance of the new warrants will be in full satisfaction of all rights pertaining to the old warrants.

      At the effective time of the merger, each outstanding option, whether or not vested, to acquire D&B common stock will be cashed out and cancelled, and the holder of each stock option will receive an amount in cash, less required withholding taxes, equal to the excess, if any, of $18.05 over the exercise price per share of common stock subject to such option for each share subject to such option. Pursuant to the terms of the option plans, all options (other than options held by non-employee directors) will vest upon stockholder approval of the merger. If D&B’s stockholders approve the merger, but the merger is not consummated, all such options will remain vested.

Treatment of Convertible Notes

      D&B has agreed to take such reasonable actions as may be necessary to prepay, redeem and/or renegotiate the Convertible Subordinated Notes due 2008, as reasonably requested by Midway and Merger Sub. Currently, the parties intend, in accordance with the terms of the indenture for those notes, to fix August 7, 2006 as the redemption date for the redemption of all outstanding notes as of the effective time of the merger. The parties will cause to be delivered to the trustee, at the effective time of the merger, a notice of redemption dated May 9, 2006 for delivery to each of the holders of the notes to effect the redemption of those notes pursuant to Section 3.2 of the indenture. In order to effect this redemption, D&B intends to deposit with the trustee at the effective time of the merger funds in an amount sufficient to pay the redemption price under the indenture with respect to all of the issued and outstanding notes including principal and premium, if any, and interest, due or to become due to such date of redemption. The holders of the notes may convert their notes at any time prior to redemption into the right to receive the cash consideration that would have been payable in the merger in exchange for the number of shares of common stock into which the notes are convertible at the time of the merger.

Exchange and Payment Procedures

      After the effective time of the merger, the surviving corporation will, from time to time, when and as required, deposit an amount of cash sufficient to pay the merger consideration to each holder of shares of D&B common stock and old D&B warrants with a bank or trust company designated by Midway as the exchange agent. The cash will be invested, as directed by the surviving corporation.

      As soon as reasonably practicable after the effective time of the merger, the exchange agent will mail a letter of transmittal and instructions to you and the other D&B stockholders and warrant holders. The letter of transmittal and instructions will tell you how to surrender D&B common stock certificates in exchange for the merger consideration, and old D&B warrants in exchange for new D&B warrants.

      You should not return D&B stock certificates or old D&B warrants with the enclosed proxy card, and you should not forward D&B stock certificates or old D&B warrants to the exchange agent without a letter of transmittal.

      You will not be entitled to receive the merger consideration in exchange for your shares of D&B common stock until you surrender your D&B stock certificate or certificates to the exchange agent, together with a duly completed and executed letter of transmittal. The merger consideration may be paid to a person other than the person in whose name the corresponding certificate is registered if the certificate is properly endorsed or is otherwise in the proper form for transfer. In addition, the person who surrenders the certificate must either pay any transfer or other applicable taxes or establish to the satisfaction of the surviving corporation that those taxes have been paid or are not applicable.

      No interest will be paid or will accrue on the cash payable upon surrender of the certificates. D&B will be entitled to deduct and withhold, and pay to the appropriate taxing authorities, any applicable taxes from any consideration paid to the holders of shares of D&B stock. Any sum which is withheld and paid to a taxing authority by D&B will be deemed to have been paid to the person from whom it is withheld.

      None of the exchange agent, Midway, Merger Sub or D&B nor their respective employees, officers, directors, stockholders agents and affiliates will be liable to any person for any cash delivered to a public official pursuant to any applicable abandoned property, escheat or similar law. Any portion of the merger consideration deposited with the exchange agent that remains undistributed to the holders of certificates evidencing shares of our common stock six months after the effective time of the merger, will be delivered to D&B, as the surviving corporation in the merger. Holders of certificates who have not surrendered their certificates prior to the delivery of such funds to D&B may only look to D&B for the payment of the merger consideration.

      If you have lost a certificate, or if it has been stolen or destroyed, then before you will be entitled to receive the merger consideration, you will have to comply with the replacement requirements, including, if required by D&B, the posting of a bond in a customary amount sufficient to protect D&B against any claim that may be made against it with respect to that certificate.

      You will not be entitled to receive a new D&B warrant in exchange for your old D&B warrant until you surrender your old D&B warrant to the exchange agent, together with a duly completed and executed letter of transmittal. The new D&B warrant may be issued to a person other than the person in whose name the corresponding old D&B warrant is registered if the old D&B warrant is properly endorsed or is otherwise in the proper form for transfer. In addition, the person who surrenders the old D&B warrant must either pay any transfer or other applicable taxes or establish to the satisfaction of the surviving corporation that those taxes have been paid or are not applicable.

Representations and Warranties

      You should be aware that the representations and warranties described below, which were made by D&B to Midway and Merger Sub in the merger agreement, may be subject to important limitations, qualifications and exceptions agreed to by Midway and Merger Sub, may not be accurate as of the date they were made and do not purport to be accurate as of the date of this proxy statement. See “Where You Can Find Additional Information” on page 54.

      We make various representations and warranties in the merger agreement that are subject, in some cases, to specified exceptions and qualifications. Our representations and warranties relate to, among other things:

      Certain of the representations and warranties made by D&B are qualified as to “materiality” or “material adverse effect.” For purposes of the merger agreement, “material adverse effect” means any effect, change, fact, event, occurrence, development or circumstance that, individually or together with any other effect, change, fact, event, occurrence, development or circumstance (A) is or could reasonably be expected to result in a material adverse effect on or change in the condition (financial or otherwise), properties, business, prospects, operations, results of operations, assets or liabilities of D&B and all of its subsidiaries, taken as a whole, or (B) could reasonably be expected to prohibit, restrict or materially impede or curtail the consummation of the transactions contemplated by the merger agreement. However, in determining whether a material adverse effect has occurred, there will be excluded any effect on D&B the cause of which is:

unless these changes or developments would reasonably be expected to have a materially disproportionate impact on the condition (financial or otherwise), properties, business, operations, results of operations, prospects, assets or liabilities of D&B and its subsidiaries taken as a whole relative to other industry participants.

      The merger agreement also contains various representations and warranties made by Midway and Merger Sub that are subject, in some cases, to specified exceptions and qualifications. The representations and warranties relate to, among other things:

      The representations and warranties of each of the parties to the merger agreement will expire upon the effective time of the merger.

Conduct of Business Pending the Merger

      Under the merger agreement, we have agreed that unless Midway gives its prior written consent, between December 8, 2005 and the completion of the merger:

      We have also agreed that during the same time period, unless Midway gives its prior written consent, and subject to certain agreed upon exceptions, we and our subsidiaries will not:

No Solicitation of Transactions

      We have agreed that we and our subsidiaries will not, directly or indirectly, through any director, officer, employee, agent, affiliate, financial advisor, representative or otherwise:

      An “acquisition proposal” is any inquiry, proposal, offer or indication of interest relating to any direct or indirect acquisition or purchase of a business or assets of D&B or its subsidiaries that generates 15% or more of the net revenues or net income, or constitutes 15% or more of the assets of D&B or any of its significant subsidiaries, or 15% or more beneficial ownership of any class of equity securities of D&B or any of its significant subsidiaries, or any tender offer or exchange offer that if consummated would result in any person beneficially owning 15% or more of any class of equity securities of D&B or any of its significant subsidiaries or any merger, consolidation, business combination, recapitalization, reorganization, liquidation, dissolution or similar transaction involving D&B or any of its significant subsidiaries.

      Notwithstanding the foregoing, prior to approval of the merger agreement by our stockholders, we or our board of directors are permitted, in response to an unsolicited bona fide, written acquisition proposal received from a third party on or after December 8, 2005, to furnish information to and negotiate and engage in discussions with such third party in connection with such unsolicited bona fide acquisition proposal, only if:

      For purposes of the merger agreement, “superior proposal” means an “acquisition proposal” (as described above), that provides a higher per share price to our stockholders from a financial point of view than the $18.05 per share merger consideration, and for which financing, to the extent required, is then represented by bona fide commitment letters (except that all references to “15% or more” in the definition of “acquisition proposal” are deemed to be “50% or more”).

      We have also agreed:

Employee Benefits

      Midway has agreed that, with respect to the employees of D&B and its subsidiaries at the effective time of the merger, it will:

Proxy Statement, Special Meeting of Stockholders and Board Recommendation

      We have agreed to prepare and file this proxy statement with the SEC, and to call a special meeting of our stockholders as promptly as reasonably practicable after December 8, 2005 for the purpose of obtaining stockholder approval of the merger agreement. We have also agreed to use reasonable best efforts to solicit from our stockholders, proxies in favor of approval of the merger agreement, and to include in this proxy statement, our board of directors’ recommendation that our stockholders approve the merger agreement.

Agreement to Notify

      D&B, Merger Sub and Midway have each agreed to notify each other of any certain facts, events or circumstances which are likely to result in a material adverse effect, or a material inaccuracy in a representation or warranty, or a material failure to comply with or satisfy a covenant, condition or agreement in the merger agreement.

Compliance with Applicable Laws

      D&B, Merger Sub and Midway have agreed to comply in all material respects with all applicable laws, rules and regulations of government entities in connection with the merger and the merger agreement.

Access to Information

      D&B and its subsidiaries and their directors, officers, employees, auditors and agents have agreed to provide to the representatives and agents of Merger Sub, Midway and the anticipated sources of financing for the merger, reasonable access to their financial operating and other data and information, facilities, offices, properties and personnel. Merger Sub and Midway have agreed to keep confidential all information received by them in accordance with the confidentiality agreement among Midway, Merger Sub and D&B.

Public Announcements

      D&B, Midway and Merger Sub have agreed to consult with each other before issuing any press release or making any public statements with respect to the merger.

Agreement to Use Reasonable Best Efforts

      D&B, Midway and Merger Sub have agreed to use their reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all actions necessary, proper or advisable to comply with all legal requirements with respect to the merger, to complete the merger and the other transactions

contemplated by the merger agreement and to obtain any governmental and third-party approvals required in connection with the merger.

Agreement to Defend and Indemnify

      D&B, Midway and Merger Sub have agreed that they will use their best efforts to defend against any action, suit, proceeding or investigation of the merger. Subject only to the limitations on indemnification contained in the Missouri Business Corporation Law and D&B’s Restated Articles of Incorporation, D&B shall indemnify and hold harmless each officer and director of D&B against any costs or expenses, damages and liabilities arising from or pertaining to the transactions contemplated by the merger agreement. D&B has agreed to pay the reasonable fees and expenses of no more than one counsel selected by the officers and directors of D&B, except in the case that two or more indemnified officers and directors have an actual conflict of interest in the outcome of the matter in the opinion of such counsel. If the merger is effected, D&B shall continue in effect for six years following the merger, for the benefit of the current D&B officers and directors, directors’ and officers’ liability insurance on no less favorable terms than the current policy. However, D&B shall not be required to expend an amount per year more than 150% of actual current annual premiums for the policy. D&B also agreed to maintain the indemnification provisions currently provided for in D&B’s Restated Articles of Incorporation for no less than six years following the merger.

Agreements Related to Financing

      Merger Sub has agreed to use reasonable best efforts to obtain the financing for the merger, consistent with the terms specified in the commitment letters. D&B has agreed to provide all cooperation reasonably necessary related to the financing, including among other matters, attendance at meetings, due diligence sessions and road shows, preparation of offering documentation, and delivery of documentation. D&B has also agreed to use its reasonable best efforts to prepay, redeem or renegotiate our convertible subordinated notes due 2008, as reasonably requested by Midway.

Takeover Statutes

      The parties have agreed that, if any takeover statute becomes applicable to the merger, they will take such actions as are necessary so that the merger may be consummated.

Disposition of Litigation

      D&B has agreed to keep Midway and Merger Sub and their counsel informed of the status of any litigation which may be brought against D&B or its directors relating to the merger, and not to settle any stockholder litigation without Midway and Merger Sub’s prior written consent.

Delisting; Termination of Registration

      Each of the parties agrees to cooperate with each other as necessary to delist the D&B common stock from NYSE and to terminate the registration of the common stock under the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act.”

Conditions to the Merger

      The obligations of the parties to complete the merger are subject to the satisfaction or waiver of the following mutual conditions:

      The obligations of Midway and Merger Sub, on the one hand, and us, on the other hand, to complete the merger are subject to the satisfaction or waiver of additional conditions, including the following:

      The obligations of Midway and Merger Sub to complete the merger are subject to the satisfaction or waiver of additional conditions, including the following:

Termination of the Merger Agreement

      The merger agreement may be terminated and the merger may be abandoned at any time prior to the effective time of the merger, whether before or after stockholder approval has been obtained, as follows:

Effect of Termination

      In the event the merger agreement is terminated as described above, the merger agreement will become void and neither Midway nor Merger Sub nor D&B will have any liability under the merger agreement, except that:

Termination Fees

      The merger agreement provides that D&B will be required to pay a termination fee of $10,175,000, plus the reasonable out-of-pocket expenses of Midway and its affiliates, not to exceed $3,000,000, if the merger agreement is terminated for the following reasons:

D&B is also required to pay the termination fee and transaction expenses not to exceed $3,000,000 of Midway and its affiliates, if (i) the merger is terminated by any party because the merger is not consummated by June 30, 2006 (as such date may be extended), and (ii) at or prior to the date of the termination of the merger agreement, an acquisition proposal has been publicly announced or disclosed, or disclosed to the board of directors or any committee of D&B’s board of directors, and (iii) within twelve months after the date of such termination, D&B enters into a definitive agreement for an acquisition proposal that provides a higher price to the D&B stockholders, from a financial point of view, than the transactions contemplated by the merger agreement.

Amendment, Waiver and Extension of the Merger Agreement

      Midway, D&B and Merger Sub may amend the merger agreement by action taken or authorized by their respective boards of directors. However, after the approval of the merger agreement by the D&B stockholders, no amendment may be made which would reduce the amount or change the type of consideration into which each share of common stock of D&B will be converted upon consummation of the merger.

      At any time prior to the completion of the merger, Midway and D&B, to the extent legally allowed, may:

Fees and Expenses

      In general, except with respect to the termination fee described under “— Termination Fees,” all costs and expenses incurred in connection with the merger agreement will be paid by the party incurring the expense.

INTERESTS OF OUR DIRECTORS AND EXECUTIVE OFFICERS IN THE MERGER

      In considering the recommendation of the board of directors with respect to the merger agreement and the merger, you should be aware that, in addition to the matters discussed above, D&B’s executive officers and directors have interests in the merger that are in addition to, or different from, the interests of the stockholders generally. The board of directors was aware of and considered these interests in deciding to approve the merger agreement and the merger.

Executive Retention Agreements; Employment Agreements

      D&B entered into executive retention agreements with each of Messrs. Corriveau and Corley effective as of April 3, 2000. Since 2001, D&B has also entered into executive retention agreements with Mr. Hammett, Mr. Smith and Mr. Plunkett (who we refer to collectively with Messrs. Corriveau and Corley as the “named executive officers”) and all four other executive officers of D&B.

      The executive retention agreements provide that, for the two-year period following stockholder approval of the merger (or one year in the case of Messrs. Corriveau and Corley), which we refer to as the “employment period,” the executive officer will remain an employee of D&B. During the employment period, (i) the executive officer’s position, authority, duties and responsibilities must be consistent in all material respects with the most significant of those held, exercised or assigned during the 90-day period before stockholder approval of the merger, (ii) the executive officer must be employed at the location where the executive officer was employed immediately before stockholder approval of the merger (or any other location that becomes D&B’s headquarters and that is not more than 25 miles distant from such prior location), (iii) the executive officer will receive an annual base salary at least equal to 12 times the highest monthly base salary paid or payable by D&B to the executive officer during the 12-month period immediately preceding the month in which stockholder approval of the merger occurs, (iv) the executive officer will be awarded an annual bonus, for each fiscal year ending during the employment period, equal to the greater of (A) the maximum bonus that the executive officer could have received pursuant to the annual incentive plan in effect 90 days before stockholder approval of the merger or (B) 60% of the executive officer’s annual base salary (the greater amount being referred to below as the “annual bonus”), and (v) the executive officer will be entitled to additional compensation and benefits, including participation in incentive, savings, and retirement plans, health and other welfare benefits plans, and fringe benefits, on a basis that is no less favorable than that in effect during the 90-day period preceding stockholder approval of the merger (or, if more favorable, than the basis on which such compensation and benefits is made available to other peer executives of D&B and its affiliated companies after stockholder approval of the merger).

      During the employment period, if the executive officer’s employment is terminated by D&B without cause or by the executive officer for good reason (as such terms are defined in the executive retention agreements), the executive officer will be entitled to (i) a lump-sum cash payment in respect of a bonus, for the fiscal year in which employment is terminated, equal to the annual bonus, pro-rated for the portion of the fiscal year during which the executive officer was employed, (ii) a lump-sum cash severance payment equal to two times the sum of the executive officer’s annual base salary and annual bonus (or three times those amounts in the case of Messrs. Corriveau and Corley), and (iii) continued savings and retirement plans, health and other welfare benefits plans, and fringe benefits for the remainder of the employment period plus two additional years. In addition, in recognition of the special value of their services during the period following the merger, Messrs. Corriveau and Corley would each be entitled to a special payment equal to the sum of his respective annual base salary and annual bonus if he remains employed for the entirety of the one-year period beginning upon stockholder approval of the merger.

      The executive retention agreements also provide that if any payments or benefits to be provided to an executive officer (whether pursuant to the executive retention agreement or otherwise, and including without limitation all payments and benefits described in this “Interests of Our Directors and Executive Officers in the Merger”) would subject the executive officer to an excise tax under Section 4999 of the Code (i.e., the “golden parachute” provisions), then the total amount of such payments and benefits will be reduced to the minimum extent necessary to cause the executive officer not to be subject to such excise tax, but only if the executive officer would retain more, on an after-tax basis, than if such a reduction were not effected and an excise tax had been paid.

      The following table sets forth the cash severance payments (i.e., the pro-rata bonus and severance payments described above) which D&B presently expects would be owing to each named executive officer and all D&B executive officers as a group if, effective as of the consummation of the merger, their employment was terminated by D&B without cause or by the executive officer with good reason:

      D&B and each of Messrs. Corriveau and Corley also entered into separate employment agreements effective as of April 3, 2000. During the 1-year employment period applicable to Messrs. Corriveau and Corley under their respective executive retention agreements, the operation of these employment agreements generally is suspended, and the respective rights and obligations of D&B and Messrs. Corriveau and Corley (including, without limitation, severance rights and obligations) are instead determined under their respective executive retention agreements. If Messrs. Corriveau and Corley remain employed after the expiration of the 1-year employment period applicable under their respective executive retention agreements, their respective employment agreements will continue in effect thereafter in accordance with their applicable terms.

Executive Retention Agreement Trust

      D&B created an executive retention agreement trust with Wachovia Bank, National Association, in December 2002. The executive retention agreement trust serves as a grantor trust, which is commonly referred to as a “rabbi trust,” and is intended to help enable D&B meet its obligations under its executive retention agreements with its executive officers and certain other of its employees. The executive retention agreement trust would have required D&B, upon stockholder approval of the merger, to fund the executive retention agreement trust with an amount sufficient to pay each executive officer the benefits to which he or she would be entitled under his or her respective executive retention agreement, plus an expense reserve

(to the extent not already contributed) that is equal to $75,000, or if greater, the estimated trustee and record-keeper expenses and fees for one year and legal fees. However, on December 7, 2005, the executive retention agreement trust was amended so that upon stockholder approval of the merger, D&B is only required to fund the executive retention agreement trust with an amount equal to the applicable expense reserve and, when executive officers (or other employees) become entitled to cash severance payments under their respective executive retention agreements, to fund the executive retention agreement trust with the amount of the cash severance payments, unless D&B pays those cash severance amounts directly.

Stock Options

      Certain of D&B executive officers and directors hold options to purchase D&B common stock. The merger agreement provides that, at the effective time of the merger, each outstanding option to purchase common stock of D&B, whether or not vested, will be cancelled in exchange for the right to receive, for each share subject to such option, a cash payment equal to the amount by which the $18.05 per share merger consideration exceeds the per share exercise price of the option, without interest, less any applicable withholding taxes. Pursuant to the terms of the option plans, all options will vest upon stockholder approval of the merger (other than options held by non-employee directors). If D&B stockholders approve the merger, but the merger is not consummated, all such options will remain vested; however, D&B could cause the termination of such options, to the extent not previously exercised, within a period not exceeding 30 days by providing an appropriate notice to the holders of such options. None of the unvested stock options that are held by D&B’s non-employee directors will vest as a result of the merger or stockholder approval of the merger and they will only be exchanged for the cash consideration provided in the merger agreement if the merger is completed; otherwise they will remain in force in accordance with their terms. The following table sets forth certain information with respect to “in-the-money” options, which are options having a per share exercise price that is less than $18.05, held as of the date hereof by each director and named executive officer and all executive officers as a group:

Restricted Stock

      All of D&B’s executive officers and outside directors have been granted restricted shares of D&B common stock. Upon stockholder approval of the merger, all of the restricted stock that has been granted will vest and all restrictions on those shares will immediately lapse. Upon consummation of the merger, the holders of those shares of previously restricted stock will be entitled to receive the merger consideration of $18.05, less any applicable withholding taxes, for each share of previously restricted stock. The following table sets forth, for each director and named executive officer and all executive officers as a group, the number of shares of restricted stock held as of the date hereof:

Supplemental Executive Retirement Plan

      Each of our executive officers is eligible to participate in the SERP. Pursuant to the SERP, executive officers may elect to defer payment of their base salary and bonus. Non-employee directors are not eligible to participate in the SERP. Amounts deferred by executive officers are credited to a bookkeeping account together with any additional amounts that D&B may determine in its discretion to credit from time to time. An executive officer is fully vested at all times in his or her own deferrals and any earnings thereon and generally vests in any employer contributions (and any earnings thereon) following a five-year period of plan participation (with ratable vesting of 20% per year for plan participation of less than five years). However, upon consummation of the merger, each executive officer will become fully vested in the amounts credited to him or her under the SERP (whether or not then otherwise vested). The following table sets forth, for each named executive officer and all executive officers as a group, their vested balance in the SERP as of December 31, 2005, and the additional amount that D&B expects to vest upon

consummation of the merger (determined without regard to any earnings after December 31, 2005 or any additional contributions that may be credited after December 31, 2005):

Indemnification and Insurance

      The merger agreement requires that, for periods both before and after the effective time of the merger, D&B (or any successor) shall indemnify, defend and hold harmless the present and former officers and directors of D&B and its subsidiaries against all losses, claims, damages, liabilities, fees and expenses incurred by reason of the fact that such person is or was an officer or director of D&B or any of its subsidiaries or for any claims arising from or pertaining to the transactions contemplated by the merger agreement. D&B agreed to pay the reasonable fees and expenses of no more than one counsel selected by the officers and directors of D&B, except in the case that two or more indemnified officers and directors have an actual conflict of interest in the outcome of the matter in the opinion of such counsel. If the merger is effected, D&B shall continue in effect for six years following the merger, for the benefit of the current D&B officers and directors, directors and officers’ liability insurance on no less favorable terms than the current policy. However, D&B shall not be required to expend more than 150% of actual current annual premiums for the policy. D&B also agreed to maintain the indemnification provisions currently provided for in D&B’s restated articles of incorporation for no less than six years following the merger.

      In addition, D&B has entered into indemnity agreements with its executive officers and directors that generally provide for indemnification for such individuals to the fullest extent provided by law. Missouri law generally grants a corporation the power to adopt broad indemnification provisions with respect to its directors and officers, but it places certain restrictions on a corporation’s ability to indemnify its officers and directors against conduct that is finally adjudged to have been knowingly fraudulent or deliberately dishonest or to have involved willful misconduct.

      Article Eleven of D&B’s restated articles of incorporation eliminates, to the fullest extent permissible under Missouri law, the liability of directors of D&B for monetary damages for breach of fiduciary duty as a director. D&B also maintains a directors’ and officers’ liability insurance policy insuring directors and officers of D&B for covered losses as defined in the policy.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table and the notes thereto set forth information as of January 16, 2006, relating to beneficial ownership (as defined in Rule 13d-3 of the Exchange Act of the common stock of D&B by (i) each person known by D&B to own beneficially more than 5% of the outstanding shares of the common stock of D&B, (ii) each director of D&B, (iii) each named executive officer set forth in the executive compensation table in D&B’s proxy statement for the 2005 annual meeting of stockholders, and (iv) all directors and executive officers of D&B as a group:

      Except as otherwise indicated, each stockholder identified in the table possesses sole voting and investment power with respect to the listed shares.

MARKET PRICE DATA AND DIVIDENDS ON COMMON STOCK

      D&B’s common stock is listed on the NYSE under the symbol “DAB.” The following table sets forth, for the periods indicated, the high and low closing sale prices per share. Share prices are as reported on the NYSE based on published financial sources.

      On December 7, 2005, the last full day of trading before the public announcement of the execution of the merger agreement, the closing price of the shares on the NYSE was $15.28 per share. On January 18, 2006, the most recent trading day prior to the date of this proxy statement, the closing price of the shares on the NYSE was $17.99 per share. As of that date, there were 1,642 holders of record of D&B’s common stock and 14,313,500 shares issued and outstanding. You should obtain current market price quotations for the D&B common stock in connection with voting your shares.

      D&B has never declared a dividend on its shares of common stock. Under the merger agreement, D&B has agreed not to declare or pay any dividends on D&B common stock prior to the closing of the merger or the earlier termination of the merger agreement.

APPRAISAL RIGHTS

      If the merger is consummated, stockholders of D&B who have not approved the merger will have the right under applicable Missouri law to object to the merger and demand payment of the fair value of their shares, instead of merger consideration. These appraisal rights apply to stockholders who object to the merger in writing, do not vote for the merger, and properly demand payment of the fair value of their shares after the merger, in accordance with and subject to the procedures set forth in Section 351.455 of the Missouri General and Business Corporation Law. The preservation and exercise of dissenters’ rights requires strict adherence to the applicable provisions of Missouri law. This summary of the rights of dissenting stockholders under Missouri law is not a complete statement of the procedures to be followed by dissenting stockholders and is qualified in its entirety by reference to Section 351.455 of the Missouri GBCL which is attached hereto as Appendix C. Stockholders who intend to exercise their dissenters’ rights are urged to carefully review the provisions set forth in Section 351.455 and to consult with legal counsel in order to comply with the required procedures.

      If you elect to exercise your right to appraisal of your shares, you must satisfy the following conditions:

      If you fail to satisfy any of the above conditions within the time periods set out in Section 351.455 of the Missouri GBCL, you will be conclusively presumed to have consented to the merger and you will be bound by its terms. The written demand for appraisal should specify your name and mailing address, the number of shares you own and that you are demanding appraisal of your shares. A proxy or vote against the merger agreement and the merger will not by itself constitute a demand. If you do not make a demand within 20 days of the merger, you will be conclusively presumed to have consented to the merger.

      We do not intend to object, assuming the proper procedures are followed, to any stockholder’s demand for payment of the fair value of his, her or its shares. We intend, however, to argue in any discussions or negotiations with dissenting stockholders or in any court proceeding that, for such purposes, the fair value of each share is less than or equal to the merger consideration.

      You should be aware that opinions of investment banking firms (including Piper Jaffray) as to the fairness from a financial point of view are not necessarily opinions as to “fair value” under Missouri law.

      If you elect to exercise appraisal rights, you should mail or deliver your written demand to: Dave & Buster’s, Inc., 2481 Manana Drive, Dallas, Texas 75220, Attention: Corporate Secretary.

      If you fail to comply fully with the statutory procedure set forth in Section 351.455, you will forfeit your rights of appraisal and will be entitled to receive the $18.05 per share merger consideration for your shares. Consequently, any stockholder wishing to exercise appraisal rights should contact legal counsel before attempting to exercise these rights.

MULTIPLE STOCKHOLDERS SHARING ONE ADDRESS

      In accordance with Rule 14a-3(e)(1) under the Exchange Act, one proxy statement will be delivered to two or more stockholders who share an address, unless D&B has received contrary instructions from one or more of the stockholders. D&B will deliver promptly upon written or oral request a separate copy of the proxy statement to a stockholder at a shared address to which a single copy of the proxy statement was delivered. Requests for additional copies of the proxy statement, and requests that in the future separate proxy statements be sent to stockholders who share an address, should be directed to Dave & Buster’s, Inc., 2481 Manana Drive, Dallas, Texas 75220, telephone: (214) 357-9588. In addition, stockholders who share a single address but receive multiple copies of the proxy statement may request that in the future they receive a single copy by contacting D&B at the address and phone number set forth in the prior sentence.

SUBMISSION OF STOCKHOLDER PROPOSALS

      If the merger is not completed, you will continue to be entitled to attend and participate in our stockholder meetings and we will hold a 2006 annual meeting of stockholders, in which case stockholder proposals will be eligible for consideration for inclusion in the proxy statement and form of proxy for our 2006 annual meeting of stockholders. We must have received any proposals of stockholders intended to be presented at our annual meeting of stockholders in 2006 on or before January 4, 2006 in order for the

proposals to be eligible for inclusion in our proxy statement and proxy for that meeting. Any other stockholder proposals to be considered for presentation at our annual meeting of stockholders in 2006, although not included in our proxy statement and proxy for that meeting, also must have been received on or before January 4, 2006 and be submitted in accordance with the requirements set forth in our bylaws.

      Stockholder proposals should be sent to Dave & Buster’s, Inc., 2481 Manana Drive, Dallas, Texas 75220, Attention: Corporate Secretary. We urge that any stockholder proposals be sent certified mail, return-receipt requested.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

      D&B files annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any reports, proxy statements or other information that we file with the SEC at the following location of the SEC:

      Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. You may also obtain copies of this information by mail from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates. Our SEC filings are also available to the public from document retrieval services and the Internet website maintained by the SEC at www.sec.gov.

      Any person, including any beneficial owner, to whom this proxy statement is delivered may request copies of reports, proxy statements or other information concerning us, without charge, by written or telephonic request directed to us at Dave & Buster’s, Inc., 2481 Manana Drive, Dallas, Texas 75220, Attention: Investor Relations. If you would like to request documents, please do so by February 16, 2006, in order to receive them before the special meeting.

      The SEC allows us to “incorporate by reference” into this proxy statement documents we file with the SEC. This means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be a part of this proxy statement, and later information that we file with the SEC will update and supersede that information. We incorporate by reference the documents listed below and any documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this proxy statement and prior to the date of the special meeting:

      No persons have been authorized to give any information or to make any representations other than those contained in this proxy statement and, if given or made, the information or representations must not be relied upon as having been authorized by us or any other person. This proxy statement is dated January 25, 2006. You should not assume that the information contained in this proxy statement is accurate as of any date other than that date, and the mailing of this proxy statement to stockholders shall not create any implication to the contrary.

Appendix A

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

DAVE & BUSTER’S, INC.,

WS MIDWAY ACQUISITION SUB, INC.

AND

WS MIDWAY HOLDINGS, INC.

DATED AS OF DECEMBER 8, 2005

AGREEMENT AND PLAN OF MERGER

      AGREEMENT AND PLAN OF MERGER, dated as of December 8, 2005 (the “Agreement”), by and among DAVE & BUSTER’S, INC., a Missouri corporation (the “Company”), WS MIDWAY ACQUISITION SUB, INC., a Missouri corporation (“Merger Sub”), and WS MIDWAY HOLDINGS, INC., a Delaware corporation (“Holdings”).

WITNESSETH:

      WHEREAS, the Board of Directors of the Company (the “Board of Directors”) and the board of directors of Merger Sub have each determined that it is in the best interests of their respective shareholders for Merger Sub to merge with and into the Company (the “Merger”) in accordance with the General and Business Corporation Law of the State of Missouri (the “Missouri BCL”) and upon the terms and subject to the conditions set forth herein;

      WHEREAS, the Board of Directors and the board of directors of Merger Sub have approved the Merger;

      WHEREAS, Merger Sub is a wholly-owned subsidiary of Holdings;

      WHEREAS, as a condition for Holdings and Merger Sub to enter into this Agreement, those shareholders of the Company listed on the signature pages to the Voting Agreement (as defined below) (the “Voting Group”) have entered into the Voting Agreement, dated as of the date hereof, with Holdings and the other parties thereto (the “Voting Agreement”), which agreement provides, among other things, that, subject to the terms and conditions thereof, each member of the Group will vote its shares of Company Common Stock (as defined below) in favor of the Merger and the approval and adoption of this Agreement;

      WHEREAS, Merger Sub, Holdings and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe various conditions to the Merger; and

      WHEREAS, terms used but not defined herein shall have the meanings set forth in Section 8.4, unless otherwise noted.

      NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereby agree as follows:

ARTICLE I

The Merger

      Section 1.1.     The Merger. At the Effective Time and subject to and upon the terms and conditions of this Agreement and the Missouri BCL, Merger Sub shall be merged with and into the Company, the separate corporate existence of Merger Sub shall cease, and the Company shall continue as the surviving corporation. The Company as the surviving corporation after the Merger hereinafter sometimes is referred to as the “Surviving Corporation.”

      Section 1.2.     Effective Time. As promptly as practicable, and in any event within one business day after the satisfaction or waiver of the conditions set forth in Article VI, the parties hereto shall cause the Merger to be consummated by filing Articles of Merger with the Secretary of State of the State of Missouri, in such form as required by, and executed in accordance with the relevant provisions of, the Missouri BCL (the time of such filing being the “Effective Time”).

      Section 1.3.     Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in the applicable provisions of the Missouri BCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time all the property, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts,

liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

      Section 1.4.     Subsequent Actions. If, at any time after the Effective Time, the Surviving Corporation shall consider or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm of record or otherwise in the Surviving Corporation its right, title or interest in, to or under any of the rights, properties or assets of either of the Company or Merger Sub acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger or otherwise to carry out this Agreement, the officers and directors of the Surviving Corporation shall be authorized to execute and deliver, in the name and on behalf of either the Company or Merger Sub, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of each of such corporations or otherwise, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.

      Section 1.5.     Articles of Incorporation; By-Laws; Directors and Officers.

      (a) At the Effective Time the Articles of Incorporation of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Articles of Incorporation of the Surviving Corporation until thereafter amended in accordance with the provisions thereof and the Missouri BCL, except that such Articles of Incorporation shall be amended to provide that the name of the Surviving Corporation shall be “Dave & Buster’s, Inc”.

      (b) The By-Laws of Merger Sub, as in effect immediately before the Effective Time, shall be the By-Laws of the Surviving Corporation until thereafter altered, amended or repealed as provided therein or in the Articles of Incorporation of the Surviving Corporation and the Missouri BCL, except that such By-Laws shall be amended to change the name of the Surviving Corporation to “Dave & Buster’s, Inc.”.

      (c) The directors of Merger Sub immediately before the Effective Time will be the initial directors of the Surviving Corporation, and the officers of the Company immediately before the Effective Time will be the initial officers of the Surviving Corporation, in each case until their successors are duly elected or appointed and qualified in the manner provided in the Surviving Corporation’s Articles of Incorporation and By-Laws, or as otherwise provided by applicable law.

      Section 1.6.     Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Merger Sub, the Company or the holder of any shares of common stock, par value $0.01 per share, of the Company (the “Company Common Stock”), or any shares of common stock, par value $0.01 per share, of Merger Sub (the “Merger Sub Common Stock”):

      Section 1.7.     Exchange of Certificates and Warrants.

      (a) Exchange Agent. From time to time after the Effective Time, the Surviving Corporation shall, when and as required, deposit with a bank or trust company designated by Holdings (the “Exchange Agent”), for the benefit of the holders of shares of Company Common Stock and Warrants, for exchange in accordance with this Article I through the Exchange Agent, an amount equal to the aggregate Merger Consideration and the aggregate Warrant Consideration (such consideration being hereinafter referred to as the “Exchange Fund”). The Exchange Agent shall, pursuant to irrevocable instructions of the Surviving Corporation, make payments of the Merger Consideration and the Warrant Consideration out of the Exchange Fund. The Exchange Fund shall not be used for any other purpose.

      (b) Exchange Procedure for Certificates. As soon as reasonably practicable after the Effective Time, the Surviving Corporation shall cause the Exchange Agent to mail to each holder of record of a certificate or certificates which immediately prior to the Effective Time represented outstanding shares of Company Common Stock (the “Certificates”) whose shares of Company Common Stock were converted into the right to receive the Merger Consideration pursuant to Section 1.6(a)(i): (x) a letter of transmittal (which

shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon delivery of the Certificates to the Exchange Agent and shall be in such form and have such other customary provisions as the Surviving Corporation may reasonably specify); and (y) instructions for use in effecting the surrender of the Certificates in exchange for the Merger Consideration. Upon surrender of a Certificate for cancellation to the Exchange Agent or to such other agent or agents as may be appointed by the Surviving Corporation, together with such letter of transmittal, duly executed, and such other documents as may reasonably be required by the Exchange Agent, the holder of such Certificate shall be entitled to receive in exchange therefor the Merger Consideration into which the shares of Company Common Stock theretofore represented by such Certificate shall have been converted pursuant to Section 1.6(a)(i), and the Certificate so surrendered shall forthwith be cancelled. The Exchange Agent shall accept such Certificates upon compliance with such reasonable terms and conditions as the Exchange Agent may impose to effect an orderly exchange thereof in accordance with normal exchange practices. In the event of a transfer of ownership of such Company Common Stock which is not registered in the transfer records of the Company, payment may be made to a Person other than the Person in whose name the Certificate so surrendered is registered, if such Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such payment shall pay any transfer or other Taxes required by reason of the payment to a Person other than the registered holder of such Certificate or establish to the satisfaction of the Surviving Corporation that such Tax has been paid or is not applicable. Until surrendered as contemplated by this Section 1.7(b), each Certificate (other than a Certificate representing shares of Company Common Stock cancelled in accordance with Section 1.6(c) and other than Dissenting Shares) shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the Merger Consideration, without interest, into which the shares of Company Common Stock theretofore represented by such Certificate shall have been converted pursuant to Section 1.6(a)(i). No interest will be paid or will accrue on the consideration payable upon the surrender of any Certificate.

      (c) Exchange Procedure for Warrants. As soon as reasonably practicable after the Effective Time, the Surviving Corporation shall cause the Exchange Agent to mail to each holder of record of a Warrant whose Warrant is converted into the right to receive a New Warrant pursuant to Section 1.6(a)(ii): (x) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Warrants shall pass, only upon delivery of the Warrants to the Exchange Agent and shall be in such form and have such other customary provisions as the Surviving Corporation may reasonably specify); and (y) instructions for use in effecting the surrender of the Warrants in exchange for the New Warrants. Upon surrender of a Warrant for cancellation to the Exchange Agent or to such other agent or agents as may be appointed by the Surviving Corporation, together with such letter of transmittal, duly executed, and such other documents as may reasonably be required by the Exchange Agent, the holder of such Warrant shall be entitled to receive in exchange therefor the New Warrant into which such Warrant shall have been converted pursuant to Section 1.6(a)(ii), and the Warrant so surrendered shall forthwith be cancelled. The Exchange Agent shall accept such Warrants upon compliance with such reasonable terms and conditions as the Exchange Agent may impose to effect an orderly exchange thereof in accordance with normal exchange practices. In the event of a transfer of ownership of such Warrant which is not registered in the transfer records of the Company, issuance of a New Warrant may be made to a Person other than the Person in whose name the Warrant so surrendered is registered, if such Warrant shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such New Warrant shall pay any transfer or other Taxes required by reason of the issuance of a New Warrant to a Person other than the registered holder of such Warrant or establish to the satisfaction of the Surviving Corporation that such Tax has been paid or is not applicable. Until surrendered as contemplated by this Section 1.7(c), each Warrant shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the New Warrant into which the Warrant shall have been converted pursuant to Section 1.6(a)(ii).

      (d) No Further Ownership Rights in Company Common Stock or Warrants. All consideration paid upon the surrender of Certificates in accordance with the terms of this Article I shall be deemed to have been paid in full satisfaction of all rights pertaining to the shares of Company Common Stock theretofore

represented by such Certificates, subject, however, to any obligation of the Surviving Corporation to pay any dividends or make any other distributions with a record date prior to the Effective Time which may have been authorized or made with respect to shares of Company Common Stock which remain unpaid or unsatisfied at the Effective Time, and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company Common Stock which were outstanding immediately prior to the Effective Time. If, after the Effective Time, the Certificates or Warrants are presented to the Surviving Corporation or the Exchange Agent for any reason, they shall be cancelled and exchanged as provided in this Article I, except as otherwise provided by applicable law.

      (e) Termination of the Exchange Fund. Any portion of the Exchange Fund which remains undistributed to the holders of the Certificates for six months after the Effective Time shall be delivered to the Surviving Corporation and any holders of the Certificates who have not theretofore complied with this Article I shall thereafter look only to the Surviving Corporation and only as general creditors thereof for payment of their claim for the Merger Consideration and, if applicable, any unpaid dividends or other distributions which such holder may be due on Company Common Stock, under applicable law.

      (f) No Liability. None of the Company, Merger Sub, Holdings, the Surviving Corporation or the Exchange Agent, or any employee, officer, director, shareholders, agent or affiliate thereof, shall be liable to any Person in respect of any cash delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.

      (g) Investment of the Exchange Fund. The Exchange Agent shall invest any cash included in the Exchange Fund, as directed by the Surviving Corporation, on a daily basis. Any interest and other income resulting from such investments shall be paid to the Surviving Corporation. To the extent that there are losses with respect to such investments, or the Exchange Fund diminishes for other reasons below the level required to make prompt payments of the Merger Consideration as contemplated hereby, the Surviving Corporation shall promptly replace or restore the portion of the Exchange Fund lost through investments or other events so as to ensure that the Exchange Fund is, at all times, maintained at a level sufficient to make such payments.

      (h) Withholding Rights. The Surviving Corporation shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of shares of Company Common Stock such amounts as the Surviving Corporation is required to deduct and withhold with respect to the making of such payment under the Internal Revenue Code of 1986, as amended (the “Code”), or any provision of state, local or foreign tax law. To the extent that amounts are so deducted and withheld by the Surviving Corporation, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the shares of Company Common Stock in respect of which such deduction and withholding was made by the Surviving Corporation.

      (i) Lost Certificates. If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting by such Person of a bond in such reasonable amount as the Surviving Corporation may require as indemnity against any claim that may be made against it with respect to such Certificate, the Exchange Agent will issue in exchange for such lost, stolen or destroyed Certificate the Merger Consideration payable in respect thereof pursuant to this Agreement.

      Section 1.8.     Stock Plans.

      (a) Not later than the Effective Time, the Company shall take all actions necessary to provide that, at the Effective Time, each then outstanding option to purchase shares of Company Common Stock (the “Options”) granted under any of the Company’s stock option plans listed in Section 3.3 of the Company Disclosure Schedule, each as amended (collectively, the “Option Plans”) or granted otherwise, whether or not then exercisable or vested, shall be cancelled in exchange for the right to receive from Merger Sub or the Surviving Corporation an amount in cash in respect thereof equal to the product of (i) the excess, if any, of the Merger Consideration over the exercise price thereof and (ii) the number of shares of Company Common Stock subject thereto (such payment to be net of applicable withholding Taxes).

      (b) Except as provided herein or as otherwise agreed to by the parties and to the extent permitted by the Option Plans, (i) the Company shall cause the Option Plans to terminate as of the Effective Time and cause the provisions in any other plan, program or arrangement providing for the issuance or grant by the Company of any interest in respect of the capital stock of the Company or any of its Subsidiaries to terminate and have no further force or effect as of the Effective Time and (ii) the Company shall ensure that following the Effective Time no holder of Options or any participant in the Option Plans or anyone other than Holdings shall hold or have any right to acquire any equity securities of the Company, the Surviving Corporation or any Subsidiary thereof.

      Section 1.9.     Time and Place of Closing. Unless otherwise mutually agreed upon in writing by Holdings and the Company, the closing of the Merger (the “Closing”) will be held at 10:00 a.m., New York City time, on the first business day following the date that all of the conditions precedent specified in Article VI (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions) have been satisfied or waived by the party or parties permitted to do so (such date being referred to hereinafter as the “Closing Date”). The place of Closing shall be at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, 4 Times Square, New York, New York, 10036-6522, or at such other place as may be agreed between Holdings and the Company.

ARTICLE II

Representations and Warranties

of Merger Sub and Holdings

      Except as set forth in the Disclosure Schedule delivered by Holdings and Merger Sub to the Company at or prior to the execution and delivery of this Agreement, after giving effect to Section 8.15 (the “Holdings Schedule”), each of Merger Sub and Holdings hereby represents and warrants to the Company as follows:

      Section 2.1.     Organization. Each of Merger Sub and Holdings is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized and has the requisite corporate power and authority to own, operate or lease the properties that it purports to own, operate or lease and to carry on its business as it is now being conducted.

      Section 2.2.     Capitalization. The authorized capital stock of Merger Sub consists of 1,000 shares of Merger Sub Common Stock. As of the date hereof, 100 of such shares are issued and outstanding, duly authorized, validly issued, fully paid and nonassessable and owned beneficially and of record by Holdings free and clear of any liens, security interests, pledges, agreements, claims, charges or encumbrances of any nature whatsoever (“Liens”). There are no options, warrants or other rights, agreements, arrangements or commitments of any character obligating Merger Sub to issue or sell any shares of capital stock of or other equity interests in Merger Sub.

      Section 2.3.     Authority. Each of Merger Sub and Holdings has the necessary corporate power and authority to enter into this Agreement and carry out their respective obligations hereunder. The execution and delivery of this Agreement by each of Merger Sub and Holdings and the consummation by each of Merger Sub and Holdings of the transactions contemplated hereby have been duly authorized by all

necessary corporate action on the part of each of Merger Sub and Holdings and no other corporate proceeding is necessary for the execution and delivery of this Agreement by either Merger Sub or Holdings, the performance by each of Merger Sub and Holdings of their respective obligations hereunder and the consummation by each of Merger Sub and Holdings of the transactions contemplated hereby. This Agreement has been duly executed and delivered by each of Merger Sub and Holdings and constitutes a legal, valid and binding obligation of each of Merger Sub and Holdings, enforceable against each of Merger Sub and Holdings in accordance with its terms, except that (i) such enforcement may be subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws, now or hereafter in effect, relating to creditors’ rights generally and (ii) equitable remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

      Section 2.4.     No Conflict; Required Filings and Consents.

      (a) The execution and delivery of this Agreement by each of Merger Sub and Holdings does not, and the performance of this Agreement by each of Merger Sub and Holdings and the consummation of the transactions contemplated hereby will not, (i) subject to the requirements, filings, consents and approvals referred to in Section 2.4(b), conflict with or violate any law, regulation, court order, judgment or decree applicable to Merger Sub or Holdings or by which their respective property is bound or subject, (ii) violate or conflict with the Articles of Incorporation or By-Laws of Merger Sub or the Certificate of Incorporation or By-Laws of Holdings or (iii) subject to the requirements, filings, consents and approvals referred to in Section 2.4(b), result in any breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination or cancellation of, or result in the creation of a Lien on any of the property or assets of Merger Sub or Holdings pursuant to, any contract, agreement, indenture, lease or other instrument of any kind, permit, license or franchise to which Merger Sub or Holdings is a party or by which either Merger Sub or Holdings or any of their respective property is bound or subject except, in the case of clause (iii), for such breaches, defaults, rights, or Liens which would not materially impair the ability of Holdings or Merger Sub to consummate the transactions contemplated hereby.

      (b) Except for applicable requirements, if any, of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Securities Act of 1933, as amended (the “Securities Act”), the pre-merger notification requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), and the filing and recordation of appropriate Articles of Merger as required by the Missouri BCL, and except as set forth in Section 2.4(b) of the Holdings Schedule, neither Holdings nor Merger Sub is required to submit any notice, report or other filing with any Governmental Entity in connection with the execution, delivery or performance of this Agreement or the consummation of the transactions contemplated hereby, except for such of the foregoing, including under Regulatory Laws, as are required by reason of the legal or regulatory status or the activities of the Company or its Subsidiaries or by reason of facts specifically pertaining to any of them. No waiver, consent, approval or authorization of any Governmental Entity is required to be obtained or made by Holdings or Merger Sub in connection with their execution, delivery or performance of this Agreement, except for such of the foregoing as are required by reason of the legal or regulatory status or the activities of the Company or its Subsidiaries or by reason of facts specifically pertaining to any of them. For purposes of this Agreement, “Regulatory Laws” means any Federal, state, county, municipal, local or foreign statute, ordinance, rule, regulation, permit, consent, waiver, notice, approval, registration, finding of suitability, license, judgment, order, decree, injunction or other authorization applicable to, governing or relating to the legal or regulatory status or the activities of the Company or its Subsidiaries, including, without limitation, with respect to alcoholic beverage control, amusement, health and safety and fire safety.

      Section 2.5.     Financing Arrangements. Merger Sub has delivered to the Company financing letters with respect to debt financing (the “Debt Financing”) of $275 million and an equity commitment letter from Wellspring Capital Management LLC (“Wellspring”) addressed to the Company with respect to equity financing of $108 million (the “Equity Financing” and, together with the Debt Financing, the “Financing”) in an aggregate amount sufficient (a) to pay (or provide the funds for the Surviving

Corporation to pay) the aggregate Merger Consideration and aggregate Warrant Consideration, (b) to pay (or provide the funds for the Surviving Corporation to pay) all amounts contemplated by Section 1.8 when due, (c) to refinance any indebtedness or other obligation of the Company which may become due as a result of this Agreement or any of the transactions contemplated hereby, and (d) to pay all related fees and expenses, arising solely out of the Merger when due. As of the date of this Agreement, the Debt Financing (as set forth in the financing letters) consists of (i) $100 million in term loans provided by banks and (ii) $175 million of senior unsecured debt securities. The foregoing financing letters, as in effect on the date of this Agreement and without giving effect to any amendments or supplements thereto after the date hereof, are hereinafter referred to as the “Commitment Letters.”

      Section 2.6.     No Prior Activities. Except for obligations or liabilities incurred in connection with its incorporation or organization or the negotiation and consummation of this Agreement and the transactions contemplated hereby (including the Financing), neither Holdings nor Merger Sub has incurred any obligations or liabilities, other than in connection with their formation, and has not engaged in any business or activities of any type or kind whatsoever.

      Section 2.7.     Brokers. Except for the Persons set forth on Section 2.7 of the Holdings Schedule, and the parties providing the Financing, and except for arrangements post-Closing, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by and on behalf of Merger Sub or Holdings.

      Section 2.8.     Information Supplied. None of the information to be supplied in writing by Merger Sub or Holdings specifically for inclusion in the proxy statement contemplated by Section 5.1 (together with any amendments and supplements thereto, the “Proxy Statement”) will, on the date it is filed and on the date it is first published, sent or given to the holders of Company Common Stock and at the time of the meeting of the Company’s shareholders to consider the Merger Agreement (the “Company Shareholders’ Meeting”), contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. If, at any time prior to the Company Shareholders’ Meeting, any event with respect to either Merger Sub or Holdings, or with respect to information supplied in writing by either Merger Sub or Holdings specifically for inclusion in the Proxy Statement, shall occur which is required to be described in an amendment of, or supplement to, such Proxy Statement, such event shall be so described by either Merger Sub or Holdings, as applicable, and provided to the Company. All documents that Merger Sub or Holdings is responsible for filing with the SEC in connection with the transactions contemplated herein will comply as to form, in all material respects, with the provisions of the Exchange Act and the rules and regulations thereunder, and each such document required to be filed with any federal, state, provincial, local and foreign government, governmental, quasi-governmental, supranational, regulatory or administrative authority, agency, commission or any court, tribunal, or judicial or arbitral body (each, a “Governmental Entity”) will comply in all material respects with the provisions of applicable law as to the information required to be contained therein. Notwithstanding the foregoing, neither Merger Sub nor Holdings makes any representation or warranty with respect to the information supplied or to be supplied by or on behalf of the Company for inclusion or incorporation by reference in the Proxy Statement.

ARTICLE III

Representations and Warranties of the Company

      Except as set forth in the Disclosure Schedule delivered by the Company to Holdings and Merger Sub at or prior to the execution and delivery of this Agreement, after giving effect to Section 8.15 (the

“Company Disclosure Schedule”), the Company hereby represents and warrants on behalf of itself and its Subsidiaries to Merger Sub and Holdings as follows: