SCHEDULE 14C
(Rule 14c-101)
INFORMATION REQUIRED IN INFORMATION STATEMENT
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14 (c)
of the Securities Exchange Act of 1934 (Amendment No. ___ )
Check the appropriate box:
| | Preliminary Information Statement | | Confidential, for Use of the
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|X| Definitive Information Statement by Rule 14c-5(d)(2))
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ELSINORE CORPORATION
________________________________________________________________________________
(Name Of Registrant As Specified In Its Charter)
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|X| No fee required.
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(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11.
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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| | Fee paid previously with preliminary materials.
| | Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
other Form or Schedule and the date of its filing.
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ELSINORE CORPORATION
202 Fremont Street
Las Vegas, Nevada 89101
September 27, 2000
Dear Stockholder:
You are cordially invited to attend the 2000 Annual Meeting of Stockholders
of Elsinore Corporation, to be held at 9:00 a.m. on October 17, 2000 in the
Royal Pavilion at the Four Queens Hotel and Casino, 202 Fremont Street, Las
Vegas, Nevada 89101.
The business to be conducted at the meeting includes the election of
directors and consideration of any other matters that may properly come before
the meeting and any adjournment or postponement thereof.
It is important that your shares be represented at the Annual Meeting.
On behalf of the Board of Directors,
/s/ S. Barton Jacka
S. Barton Jacka
Secretary of Elsinore Corporation
ELSINORE CORPORATION
202 FREMONT STREET
LAS VEGAS, NEVADA 89101
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Notice is hereby given that the annual meeting (the "Annual Meeting") of
stockholders of Elsinore Corporation, a Nevada corporation (the "Company"), will
be held in the Royal Pavilion at the Four Queens Hotel and Casino, 202 Fremont
Street, Las Vegas, Nevada 89101, at 9:00 a.m. on October 17, 2000, for the
following purposes:
(a) To elect four directors; and
(b) To transact any other business which may properly come before the
Annual Meeting or any adjournment or postponement thereof.
WE ARE NOT ASKING FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
The Board of Directors has fixed September 22, 2000 as the record date for
determination of stockholders entitled to notice of and to vote at the Annual
Meeting and any adjournments or postponements thereof. Accordingly, only holders
of record of Common Stock and Preferred Stock at the close of business on such
date shall be entitled to vote at the Annual Meeting and any adjournment or
postponement thereof. A list of such stockholders will be available for
examination by any stockholder at the Annual Meeting and, for purposes germane
to the Annual Meeting, at the office of the Secretary of the Company, 202
Fremont Street, Las Vegas, Nevada, for a period of ten days prior to the Annual
Meeting.
This information statement is being mailed to the Company's stockholders on
or about September 27, 2000 by order of the Company's Board of Directors.
The Officers and Directors of the Company cordially invite you to attend
the Annual Meeting.
On behalf of the Board of Directors,
/s/ S. Barton Jacka
S. Barton Jacka
Secretary of Elsinore Corporation
Las Vegas, Nevada, September 27, 2000
INFORMATION STATEMENT
This Information Statement is being furnished on or about September 27,
2000 by the Board of Directors of Elsinore Corporation (the "Company") in
connection with the annual meeting (the "Annual Meeting") of the stockholders of
the Company to be held at the Four Queens Hotel and Casino, 202 Fremont Street,
Las Vegas, Nevada 89101, at 9:00 a.m. on October 17, 2000, and with any
adjournment or postponement thereof. The Company's principal executive offices
are located at 202 Fremont Street, Las Vegas, Nevada 89101, and its telephone
number is (702) 385-4011.
The Board of Directors of the Company has fixed September 22, 2000 as the
record date for the determination of stockholders entitled to notice and to vote
at the Annual Meeting (the "Record Date"). As of the Record Date, there were
4,993,965 shares of Common Stock, $.001 par value per share (the "Common
Stock"), issued and outstanding and held by approximately 935 holders of record.
In addition, 50,000,000 shares of Series A Convertible Preferred Stock are
outstanding. The shares of Preferred Stock have the right to convert to
93,000,000 shares of the Company's Common Stock. The Company's annual report on
Form 10-K (the "Annual Report") to stockholders for the fiscal year ended
December 31, 1999, including audited financial statements, is being transmitted
to stockholders of record as of the Record Date concurrently. Stockholders are
urged to read the Annual Report in its entirety.
The presence of the holders of a majority of the Company's outstanding
shares of voting stock shall constitute a quorum. Each share of Common Stock and
Preferred Stock (on an as-converted basis except with respect to election of
directors) is entitled to one vote on all matters submitted to a vote of
stockholders. In connection with the cumulative voting feature applicable to the
election of directors, each stockholder is entitled to as many votes as shall
equal the number of shares held by such person at the close of business on the
record date multiplied by the number of directors to be elected. A stockholder
may cast all of such votes for a single nominee or may apportion such votes
among any two or more of them, as he or she sees fit. A stockholder may withhold
votes from any or all nominees. The affirmative vote of a plurality of the
shares represented at the Annual Meeting will be necessary for the election of
directors. Proposals are approved if the number of shares voted in favor exceeds
the number voted against. Abstentions are counted for the purposes of
determining if a quorum is present at the Annual Meeting for the transaction of
business. In addition, abstentions are included in determining the number of
shares voted on proposals submitted to stockholders (other than the election of
directors) and will have the same effect as a vote against such proposals. If
nominee recordholders do not vote on specific issues because they did not
receive specific instructions on such issues from the beneficial owners of such
shares ("Broker Nonvotes"), such Broker Nonvotes will not be treated as either
votes cast or shares present or represented for purposes of establishing a
quorum.
WE ARE NOT ASKING FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
As of September 7, 2000, the Company had two classes of voting securities,
Common Stock and Series A Convertible Preferred Stock. Series A Convertible
Preferred Stock votes on an as-converted basis except with respect to the
election of directors for which each share is entitled to one vote. As of
September 7, 2000, the beneficial ownership of Common Stock by each person who
is known by the Company to be the beneficial owner of more than 5% of the
outstanding Common Stock and Series A Convertible Preferred Stock, is as
follows:
Common Stock
Amount and Nature of Percent
Name and Address of Beneficial Owner Beneficial Ownership(1) of Class
------------------------------------ ----------------------- ---------
John C. "Bruce" Waterfall, who exercises voting and investment
authority over the Common Stock owned by the MWV Accounts, as follows
(2)(3):
Betje Partners 4,278,690.06 46.5%
Endowment Prime, L.L.C. (f/k/a)
The Common Fund for Non-Profit Organizations14,836,328.84 77.8
Morgens Waterfall Income Partners, L.P. 2,604,280.86 34.6
MWV Employee Retirement Plan Group Trust 879,022.60 15.2
MWV International, Ltd. 3,898,515.00 79.1
Phoenix Partners, L.P. 12,276,868.62 71.4
Restart Partners, L.P. 10,273,330.56 67.6
Restart Partners II, L.P. 19,677,499.86 80.0
Restart Partners III, L.P. 16,089,026.04 76.6
Restart Partners IV, L.P. 10,135,926.78 67.3
Restart Partners V, L.P. 2,696,949.78 35.4
------------- ------
Total 97,646,439.00 99.7%
============= ======
Preferred Stock
Amount and Nature of Percent
Name and Address of Beneficial Owner Beneficial Ownership(1) of Class
------------------------------------ ----------------------- ---------
John C. "Bruce" Waterfall, who exercises voting and investment
authority over the Common Stock owned by the MWV Accounts, as follows
(2)(3):
Betje Partners 2,300,371.00 4.6%
Endowment Prime, L.L.C. (f/k/a)
The Common Fund for Non-Profit Organizations 7,596,894.00 15.2
Morgens Waterfall Income Partners, L.P. 1,400,151.00 2.8
MWV Employee Retirement Plan Group Trust 450,110.00 *
MWV International, Ltd. - *
Phoenix Partners, L.P. 6,600,467.00 13.2
Restart Partners, L.P. 5,523,296.00 11.0
Restart Partners II, L.P. 10,579,301.00 21.2
Restart Partners III, L.P. 8,650,014.00 17.3
Restart Partners IV, L.P. 5,449,423.00 10.9
Restart Partners V, L.P. 1,449,973.00 2.9
------------- ------
Total 50,000,000.00 100.0%
============= ======
*Less than 1% of the outstanding shares
(1) The number of shares beneficially owned and the percentage of shares
beneficially owned are determined in accordance with the rules of the Securities
and Exchange Commission and are based on 4,929,313 shares of Common Stock and
50,000,000 shares of Series A Convertible Preferred Stock, which are convertible
into 93,000,000 shares of Common Stock outstanding as of February 6, 2000.
(2) The address for Mr. Waterfall and each of the MWV Accounts is 10 East
50th Street, New York, New York 10022.
(3) The Common Stock table represents shares on an as-converted basis and
the Preferred Stock table only represents shares of Series A Convertible
Preferred Stock. Pursuant to agreements and undertakings with the Board and the
Commission which were required in order for the Company's plan of reorganization
to become effective, Mr. Waterfall is the only individual who exercises voting
and investment power (including dispositive power) with respect to Common Stock
owned by the MWV Accounts. MWV and its affiliates other than Mr. Waterfall are
either investment advisors to, or trustees or general partners of, the MWV
Accounts. Accordingly, for purposes of the relevant Exchange Act rules, they
could also be deemed the beneficial owners of Common Stock held by the MWV
Accounts. The possible attribution of such beneficial ownership of Common Stock,
expressed in number of shares, on an as-converted basis, and percent of the
class, to MWV and those affiliates is as follows: MWV- 9,056,227.66 (90.2%);
Endowment Prime, L.L.C. - 14,836,328.84 (77.8%); MW Capital, L.L.C. -
2,604,280.86 (34.6%); MW Management, L.L.C. - 12,276,868.62(71.4%); Prime Group,
L.P. - 10,273,330.56(67.6%); Prime Group II, L.P. - 19,677,499.86 (80.0%); Prime
Group III, L.P. - 16,089,026.04 (76.5%); Prime Group IV, L.P. - 10,135,926.78
(67.3%); and Prime Group V, L.P. - 2,696,949.78 (35.4%). The possible
attribution of ownership of Series A Convertible Preferred Stock, expressed in
number of shares and percent of the class, to MWV and those affiliates is as
follows: MWV- 2,750,481.00 (5.5%); Endowment Prime, L.L.C. -
7,596,894.00(15.2%); MW Capital, L.L.C. 1,400,151.00 (2.8%); MW Management,
L.L.C. - 6,600,467.00 (13.2%); Prime Group, L.P. - 5,523,296.00 (11.0%); Prime
Group II, L.P. - 10,579,301.00 (21.2%); Prime Group III, L.P. - 8,650,014.00
(17.3%); Prime Group IV, L.P. - 5,449,423.00 (10.9%); and Prime Group V, L.P. -
1,449,973.00 (2.9%). In view of Mr. Waterfall's possession of sole voting and
investment power over the Common Stock and Preferred Stock on behalf of the MWV
Accounts, these entities disclaim beneficial ownership of Common Stock and
Preferred Stock.
Security Ownership of Management
Management
As of September 7, 2000, the beneficial ownership of Common Stock and
Preferred Stock by each of Elsinore's directors and by its directors and
executive officers as a group, as such ownership is known by Elsinore, is as
follows:
Amount and Nature
of Beneficial Percent
Title of Class Name of Beneficial Owner Ownership of Class
-------------- ------------------------ ----------------- --------
Common Stock John C. "Bruce" Waterfall,
Chairman of the Board (1) 97,646,440 (2) 99.7%
Common Stock Directors and executive
officers as a group (3 persons) 97,646,440 (2) 99.7
Series A John C. "Bruce" Waterfall,
Convertible Chairman of the Board (1)
Preferred 50,000,000 100.0
Series A Directors and executive
Convertible officers as a group (3 persons)
Preferred 50,000,000 100.0
(1) Represents Mr. Waterfall's beneficial ownership on an as-converted
basis. See note (3) to the table on page 6 regarding the beneficial ownership of
MWV.
(2) See note (1) to the table on page 6 discussing beneficial owners of
more than 5% of the outstanding Common Stock for information regarding Mr.
Waterfall's beneficial ownership.
ELECTION OF DIRECTORS
At the Annual Meeting, four directors will be elected to serve until the
next annual meeting of the stockholders or until their respective successors
have been duly elected and qualified. The Board of Directors has nominated John
C. "Bruce" Waterfall, Jeffrey T. Leeds, S. Barton Jacka and Donald A. Hinkle for
election at the Annual Meeting. The Board of Directors knows of no reason why
any of the nominees would be unable or unwilling to serve.
The Board of Directors unanimously recommends a vote FOR all nominees listed
below.
Nominees for Director
The following sets forth the names, ages and positions of each person who
is a director, executive officer or significant employee of the Company. Each
director listed below, except Donald A. Hinkle, assumed his position with the
Company on the Plan Effective Date and was re-elected at the Company's 1999
Annual Shareholders' Meeting held on October 26, 1999 to serve until the next
Annual Shareholders' Meeting. In 1999, the Company did not have any executive
officers who were not also a Director of the Company.
Name Age Position
---- --- --------
Directors and Officers
----------------------
John C. "Bruce" Waterfall 63 Chairman of the Board, Nominee
Jeffrey T. Leeds 44 President, Chief Executive Officer and
Director, Nominee
S. Barton Jacka 64 Treasurer, Secretary and Director, Nominee
Donald A. Hinkle 52 Director, Nominee
Significant Employee
--------------------
Philip W. Madow 41 Acting General Manager
The Board has been increased in size to consist of four directors following
the Annual Meeting.
John C. "Bruce" Waterfall. Mr. Waterfall has been Chairman of the Board of
Elsinore since February 1997. Mr. Waterfall has been a professional money
manager and analyst for the past 31 years with MWV, of which he is President and
a co-founder. Certain investment accounts managed by MWV own 99.7% of the
outstanding Common Stock, and Mr. Waterfall exercises sole voting and investment
authority over that Common Stock. Mr. Waterfall also serves as a director of
Darling International, Inc., a publicly reporting company under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
Jeffrey T. Leeds. Mr. Leeds has been the President, Chief Executive
Officer, and a member of the Board of Directors of Elsinore since February 1997.
Since 1993, Mr. Leeds has been President of Leeds Group, Inc., a private
investment-banking firm which he co-founded. Mr. Leeds is also a Principal of
Advance Capital Management, LLC, a private equity firm which he formed in 1995.
S. Barton Jacka. Mr. Jacka has been the Secretary, Treasurer and a member
of the Board of Directors of Elsinore since February 1997. Mr. Jacka is a gaming
consultant and serves as chairman of the gaming compliance committees of several
companies licensed by the Nevada Gaming Authorities. From 1993 to 1996, Mr.
Jacka was with Bally Gaming, Inc. and Bally Gaming International, Inc., first as
Director of Government Affairs and Gaming Compliance and later as Vice
President. He held the position of Director of Corporate Gaming Compliance for
Bally Manufacturing Corporation and then Ballys Casino Resort from 1987 to 1993.
Mr. Jacka retired from the position of Chairman of the Nevada State Gaming
Control Board, a position he held from 1985 to 1987, prior to entering the
private sector.
Donald A. Hinkle. Mr. Hinkle has 26 years of experience in the gaming
industry. He is a certified public accountant and a member of the American
Institute of Certified Public Accountants and has held gaming licenses in both
Nevada and Atlantic City. Since 1999, Mr. Hinkle has been the Director of
Finance and Chief Financial Officer for the AVI Hotel and Casino, a Native
American resort located in Laughlin, Nevada. From 1986 to 1998 he held executive
finance positions with Bally's Park Place, Atlantic City; Bally's Grand,
Atlantic City; the Dunes Hotel/Casino and Country Club, Las Vegas; and Bally
Systems in Reno, Nevada. He began his gaming career with the Las Vegas Hilton
holding various accounting positions from 1976 to 1985.
Philip W. Madow Mr. Madow assumed the position of Acting General Manager of
the Four Queens effective August 10, 2000. Mr. Madow has over 21 years of
experience in the Hospitality and Gaming Industry. He has worked with Marriott
Corporation and has been with the Four Queens for nearly 15 years. Most recently
he has served as the Company's Director of Operations and Administration.
Committees and Meetings
The Board of Directors currently has an Audit Committee. The membership of
such committee is determined from time to time by the Board of Directors.
Currently, the Audit Committee consists of Messrs. Waterfall, Leeds, and Jacka.
The functions of the Audit Committee include reviewing the independence of
the independent auditors, recommending to the Board of Directors the engagement
and discharge of independent auditors, reviewing with the independent auditors
the plan and results of auditing engagements, approving or ratifying each
material professional service provided by independent auditors, considering the
range of audit and non-audit fees, reviewing the scope and results of the
Company's procedures for internal auditing and the adequacy of internal
accounting controls and directing and supervising special investigations.
The Company did not have a compensation committee in 1999. The full Board
of Directors has made all decisions regarding executive officer compensation.
Messrs. Leeds and Jacka receive compensation as executive officers and are
members of the Board of Directors.
In 1999, the Board of Directors held 5 meetings and took no action by
written consent. The Audit Committee held 4 meetings. Each director attended
more than 75% of the aggregate number of meetings of the Board and the
committees on which he served in 1999.
Compensation of Directors
Current Board of Directors. Mr. Waterfall receives no compensation from the
Company for serving as Chairman of the Board and attending Board of Directors
meetings. Each of the other directors receives an annual fee of $25,000 in
consideration of his attendance at each quarterly Board of Directors meeting
plus $1,000 for each additional meeting (other than meetings by telephone
conference) at which his attendance is required. All directors receive
reimbursement for reasonable expenses incurred in attending each meeting of the
Board of Directors. Jeffrey T. Leeds and S. Barton Jacka also receive $10,000
per year in consideration of serving as executive officers of the Company.
Separate from his duties as a Director of the Company, Mr. Jacka receives
$48,000 per year for serving as a consultant to the Company for Gaming
Compliance matters.
Certain Relationships and Related Transactions
Mr. Waterfall, our Chairman of the Board, is the President and a principal
shareholder of MWV, which manages the MWV Accounts. Pursuant to the
Recapitalization on September 29, 1998, the MWV Accounts have beneficially owned
99.7% of the Common Stock and $11,104,000 principal amount of the 12.83% New
Second Mortgage Notes.
Mr. Jacka receives $48,000 per year for serving as a consultant to the
Company for Gaming Compliance matters.
Riviera Gaming Management - Elsinore, a subsidiary of Riviera Holdings
Corporation ("RGME"), managed the Four Queens Hotel & Casino, a subsidiary of
Elsinore, under an arrangement effective April 1, 1997 ("Management
Arrangement"). In connection with RGME's management, RGME's principal officer
also served, at the request of Elsinore, as the sole director and officer of
Four Queens on a non-salaried basis and was excluded from performing
policy-making functions for Elsinore. As a result of the termination of the
Management Arrangement between the Company and RGME on December 31, 1999, Mr.
Waterfall has assumed the positions of sole director and officer of the Four
Queens. In addition, Riviera Holdings Corporation ("Riviera") was also a party
to an agreement with R&E Gaming Corporation ("R&E") providing for the merger of
Riviera Acquisition Sub, Inc. into Riviera ("Riviera Merger"). Effectiveness of
the Riviera Merger was a condition precedent to consummation of the merger
between the Elsinore and entities controlled by Mr. Allen E. Paulson, namely R&E
and Elsinore Acquisition Sub, Inc. ("EAS") (the "Merger"). Upon consummation of
the Merger, RGME would have been entitled to certain payments under the
Management Arrangement.
The Management Arrangement was negotiated and went into effect before R&E
or any of its affiliates entered into negotiations with Riviera or Elsinore
concerning the Merger, the Riviera Merger, an Option and Voting Agreement
between R&E and MWV, or an Option and Voting Agreement between R&E and certain
Riviera shareholders.
EXECUTIVE COMPENSATION
The following table provides certain summary information concerning
compensation paid by the Company to each person who served as Chief Executive
Officer during any part of the year ended December 31, 1999. No person who held
any other executive officer position during any part of 1999 received a total
annual salary and bonus in excess of $100,000 in such year.
Long Term
Compensation
Awards
------------
Name and Principal Position Annual Compensation Securities All Other
--------------------------- -------------------- Underlying Compensation
Year Salary($) Bonus($) Options(#) ($)
---- --------- -------- ----------- ------------
Jeffrey T. Leeds 1999 39,000 -0- -0- -0-
President and Chief 1998 37,000 -0- -0- -0-
Executive Officer 1997 35,000 -0- -0- -0-
Stock Options and Similar Rights
The Company did not grant any stock options or stock appreciation rights
(collectively, "Stock Rights") during 1999 nor were any Stock Rights exercised
in 1999. As of February 28, 1997, the effective date of the Plan, all previously
outstanding Stock Rights were canceled.
Compensation Committee Interlocks and Insider Participation
The Company did not have a compensation committee in 1999. The full Board
of Directors has made all decisions regarding executive officer compensation.
Messrs. Leeds and Jacka receive compensation as executive officers and are
members of the Board of Directors. Separate from his duties as a Director of the
Company, Mr. Jacka receives $48,000 per year for serving as a consultant to the
Company for Gaming Compliance matters.
Mr. Waterfall, our Chairman of the Board, is the President and a principal
shareholder of MWV, which manages the MWV Accounts. Pursuant to the
Recapitalization on September 29, 1998, the MWV Accounts have beneficially owned
99.7% of the Common Stock and $11,104,000 principal amount of the 12.83% New
Second Mortgage Notes.
RGME, managed the Four Queens Hotel & Casino, a subsidiary of Elsinore,
under a Management Arrangement. In connection with RGME's management, RGME's
principal officer also served, at the request of Elsinore, as the sole director
and officer of Four Queens on a non-salaried basis and was excluded from
performing policy-making functions for Elsinore. As a result of the termination
of the Management Arrangement between the Company and RGME on December 31, 1999,
Mr. Waterfall has assumed the positions of sole director and officer of the Four
Queens. In addition, Riviera was also a party to an agreement with R&E providing
for the Riviera Merger. Effectiveness of the Riviera Merger was a condition
precedent to consummation of the Merger. Upon consummation of the Merger, RGME
would have been entitled to certain payments under the Management Arrangement.
The Management Arrangement was negotiated and went into effect before R&E
or any of its affiliates entered into negotiations with Riviera or Elsinore
concerning the Merger, the Riviera Merger, the Option and Voting Agreement
between R&E and MWV, or the Option and Voting Agreement between R&E and certain
Riviera shareholders.
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION
Since the Plan Effective Date, Messrs. Leeds and Jacka have been the only
executive officers of the Company. The Board of Directors has established
minimal stipends for Messrs. Leeds and Jacka, in light of the Company's
financial position, and determined the salary of the former General Manager and
the current Acting General Manager of the Four Queens. The Board of Directors
delegated all other compensation decisions to RGME until the appointment of Dual
B. Cooper, Jr., General Manager of the Four Queens, on September 3, 1999.
Pursuant to RGME's Management Arrangement, in the event compensation in excess
of $125,000 was granted to any employee, such compensation must have been
approved by the Board of Directors. The Management Agreement between the Company
and RGME terminated on December 31, 1999. Currently all other compensation
decisions are made by the Acting General Manager of the Four Queens.
Chief Executive Compensation
Jeffrey Leeds received compensation for serving as President and Chief
Executive Officer of the Company in 1999 in the amount of $10,000. Such amount
was determined primarily based on the Company's financial position.
BOARD OF DIRECTORS
John C. "Bruce" Waterfall, Chairman
Jeffrey T. Leeds
S. Barton Jacka
PERFORMANCE GRAPH
The following graph compares the annual change in the cumulative total
return, assuming reinvestment of dividends, if any, on the Company's Common
Stock with the annual change in the cumulative total returns of the Nasdaq Stock
Market (U.S. Companies), the American Stock Exchange Index (U.S. Companies) (the
"AMEX Index") and the Nasdaq Amusement and Recreation Services Index (the
"Nasdaq 79xx"), which the Company considers to be its industry peer group.
Nasdaq 79xx is comprised of companies whose stock is traded on the Nasdaq
National Market and which have a standard industry classification within
7900-7999. The graph assumes an investment of $100 on February 28, 1997, in each
of the stocks comprising the Nasdaq Stock Market, the AMEX Index and the Nasdaq
79xx. Data as to the Company's trading price is based solely on reported
activity on the Nasdaq Bulletin Board. The graph lines merely connect the prices
on the dates indicated and do not reflect fluctuation between the dates.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN FOR ELSINORE CORPORATION, NASDAQ
STOCK MARKET (U.S. COMPANIES) INDEX, AMEX INDEX AND NASDAQ 79XX
CRP TOTAL RETURNS INDEX FOR: 2/28/97 12/31/97 12/31/98 12/31/99
--------------------------------------------------------------------------------
Nasdaq Stock Market (U.S. Companies) 100.00 121.1 170.7 317.4
AMEX Stock Market (U.S. Companies) 100.00 120.0 128.2 169.5
Nasdaq Stocks (SIC 7900-7999 U.S.
Companies) amusement and recreation
services 100.00 115.6 118.2 143.8
Company Common Stock 100.00 1,406.25 175.63 234.38
The trading market for the Common Stock is extremely thin. The MWV Accounts
own 99.7% of the outstanding Common Stock, which they acquired pursuant to the
Plan, and they have not bought or sold any Common Stock since the Plan became
effective. In view of the lack of an organized or established trading market for
the Common Stock, the extreme thinness of whatever trading market may exist, the
limited number of shares that are not held by the MWV Accounts, and the current
litigation relating to the Merger Agreement, the prices reflected on the chart
as reported on the Nasdaq Bulletin Board may not be indicative of the price at
which any prior or future transactions were or may be effected in the Common
Stock. Stockholders are cautioned against drawing any conclusions from the data
contained herein, as past results are not necessarily indicative of future stock
performance. The Performance Graph in no way reflects the Company's forecast of
future stock price performance.
THE FOREGOING REPORT OF THE BOARD OF DIRECTORS AS TO EXECUTIVE COMPENSATION
AND THE PERFORMANCE GRAPH THAT APPEARS IMMEDIATELY ABOVE SHALL NOT BE DEEMED TO
BE SOLICITING MATERIAL OR TO BE FILED UNDER THE SECURITIES ACT OF 1933 OR THE
SECURITIES EXCHANGE ACT OF 1934, OR INCORPORATED BY REFERENCE IN ANY DOCUMENT SO
FILED.
INDEPENDENT AUDITORS
The Company has continued to retain the firm of Deloitte & Touche LLP as
independent accountants for the Company's fiscal year ending December 31, 2000.
The Company's Board of Directors approved the retention of Deloitte &Touche LLP
as independent accountants upon recommendation of the Company's Audit Committee.
A representative of Deloitte & Touche LLP is expected to be present at the
meeting and will have the opportunity to make a statement if such representative
so desires, and will be available to respond to appropriate questions.
2001 Annual Meeting of Stockholders
Stockholders who may wish to present proposals for inclusion in the
Company's proxy materials in connection with the 2001 Annual Meeting of
Stockholders must submit such proposals in writing to the Company's Secretary at
the address shown at the top of page 2 not later than May 25, 2001. In addition,
to be properly considered at the 2001 Annual Meeting of Stockholders, notice of
any stockholder proposals must be given to the Secretary in writing not less
than 60 nor more than 90 days prior to the meeting; provided, that in the event
that less than 70 days notice of the meeting date is given to stockholders,
proposals must be received not later than the close of business on the tenth day
following the day on which notice of the annual meeting date was mailed or
publicly disclosed. A stockholder's notice to the Secretary must set forth for
each matter proposed to be brought before the annual meeting (a) a brief
description of the matter the stockholder proposes to bring before the annual
meeting, (b) the name and home address of the stockholder proposing such
business, (c) the class and number of shares of Common Stock beneficially owned
by such stockholder, and (d) any financial interest of such stockholder in such
business.
OTHER MATTERS
The Board of Directors does not intend to present or knows of any other
business which will be presented for consideration at the Annual Meeting.
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1999, AS FILED WITH THE SEC WILL BE PROVIDED TO STOCKHOLDERS
WITHOUT CHARGE UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY AT 202
FREMONT STREET, LAS VEGAS, NEVADA 89101.
By Order of the Board of Directors
Las Vegas, Nevada
September 27, 2000
