UNION PLAZA HOTEL AND CASINO, INC.
Number One Main Street
Las Vegas, Nevada 89125
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
to be held
May 21, 1999
INTRODUCTION
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Union Plaza Hotel and
Casino, Inc., a Nevada corporation (the "Company"), of proxies
for use at the 1999 Annual Meeting of Stockholders of the Company
to be held on Friday, May 21, 1999, or any adjournment or
adjournments thereof, for the purposes set forth in the
accompanying Notice of that Meeting. Such Notice and this
accompanying Proxy Statement are being mailed to the stockholders
on or about the date of such Notice and this Proxy Statement. All
expenses incident to the preparation and mailing of, or otherwise
making available to all stockholders, the Notice, Proxy Statement
and form of Proxy are to be paid by the Company.
A stockholder giving a Proxy may revoke it at any time before
it is exercised. Subject to statutory provisions providing for
the automatic revocation of a Proxy by the passage of time, any
Proxy duly executed is not revoked and continues in full force
and effect until an instrument revoking it or a duly executed
Proxy bearing a later date is filed with the Secretary of the
Company. The persons named in the accompanying form of Proxy
have advised the Company that, unless the Proxy is marked to the
contrary, they intend to vote the Proxies received by them (1)
for Management nominees for election as Directors (reference is
made to "Election of Director" below), and (2) to transact any
other business which may properly come before the meeting or any
adjournment thereof.
Only stockholders of record at the close of business on March
19, 1999, will be entitled to notice of, and to vote at, the
meeting or any adjournments thereof. On such record date, there
were 757,419 shares of the Company's capital stock outstanding.
Holders of shares of capital stock have full voting rights, one
vote for each share held of record.
Other than as disclosed in the table below under "Securities
Ownership of Certain Beneficial Owners and Management", the
Company's management is not aware that any person has beneficial
ownership (as defined in Footnote 1 to such table) of more than
five percent (5%) of the total number of shares of the Company's
capital stock outstanding on the record date.
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PURPOSES OF ANNUAL MEETING
The purposes of this Annual Meeting of Stockholders are (1)
to elect seven (7) directors of the Company to hold office until
the next Annual Meeting of Stockholders or until their successors
are elected, and (2) to transact any other business which may
properly come before the meeting or any adjournment thereof.
ELECTION OF DIRECTORS
One of the purposes of the Annual Meeting is to elect seven
(7) directors for the ensuing year. The term of each person
elected as a director will continue until the 2000 Annual Meeting
or until his successor is elected and qualified.
Unless instructed to the contrary, the persons named in the
accompanying form of Proxy will vote shares subject to unrevoked
Proxies for the election as directors of the nominees named
below. Although it is not contemplated that any nominee will
decline or be unable to serve, such shares will, if such
contingency should arise, be voted at the discretion of such
person(s).
All nominees were elected at the 1998 Annual Meeting of
Stockholders.
Information About Nominees
JOHN D. GAUGHAN, Director since 1969
Mr. Gaughan, 79, was elected Chairman of the Board and Chief
Executive Officer in July, 1986, and has been Vice President of
the Company since 1969. He has been an officer and director
of E.G.& H., Inc.; the owner and operator of the Las Vegas Club in
Las Vegas, Nevada, since 1961; and of Exber, Inc., the owner and
operator of the El Cortez Hotel & Casino in Las Vegas, Nevada,
since 1963. He served as a director of Showboat, Inc., the owner
and operator of the Showboat Hotel & Casino in Las Vegas, Nevada,
from 1978 until June 1998.
<PAGE>
J.K. HOUSSELS, Director since 1969
Mr. Houssels, 77, has been Vice Chairman of the Board since
May, 1985; he was President of the Company from September, 1983
until May, 1985; Executive Vice President of the Company from
1974 until September, 1983; and has been a director of the
Company since 1969. For a period of five years ending in 1972,
Mr. Houssels was a director of Hotel Conquistador, Inc., and was
its President until October, 1971. He served as Chairman of the
Board of Directors of Showboat, Inc., which owns and operates the
Showboat Hotels and Casinos from 1955 until June 1998, and served
as a director of the First Western Financial Corporation from
1977 to July, 1991.
MIKE NOLAN, Director since 1991
Mr. Nolan, 44, has been a Vice President of the Company since
May 20, 1992, and Hotel manager since June, 1988. Mr. Nolan has
been General Manager of the Gold Spike Hotel and Casino since
August, 1983. He has been with the Gaughan organization since
1978.
DONALD DOBSON, Director since 1991
Mr. Dobson, 70, has been a Vice President of the Company
since May 20, 1992. He also has been Secretary of the Company
since July, 1986, and Assistant to the President since October,
1984. Mr. Dobson was employed by the Company and served as Vice
President of Administration from April until October, 1971. He
was General Manager of the El Cortez Hotel and Casino for several
years, prior to re-joining the Company in July, 1980.
JOHN P. JONES, Director since 1986
Mr. Jones, 76, has been Treasurer of the Company since May,
1991, a Vice President of the Company since March, 1975, and has
been employed by the Company as manager of the slot machine
operation since 1971, prior to which he was a casino shift
manager at the Club Bingo Casino in downtown Las Vegas since
1962.
LARRY E. DOLESH, Director since June, 1991
Mr. Dolesh, 57, has been a Vice President of the Company
since May 20, 1992. He was Controller of the Company from May,
1988 to May, 1992. He was Controller of the El Cortez Hotel
and Casino and of the Las Vegas Club Hotel and Casino for ten
years, prior to accepting his position with the Union Plaza Hotel
and Casino.
<PAGE>
IRVINE K. EPSTEIN, Director since September 1997
Mr. Epstein was elected to the Board on September 26, 1997.
He is currently vice president of marketing for Coast Resort,
Inc., which operates the Barbary Coast, Gold Coast and Orleans
Hotel & Casinos in Las Vegas, Nevada. Between 1979 and 1996,
Mr. Epstein was a general partner with the Barbary Coast Hotel and
Casino. Prior to his employment with the Barbary Coast, Mr.
Epstein was an owner and casino executive of Exber, Inc., the
operator of the El Cortez Hotel & Casino, in Las Vegas, Nevada.
Other Information about the Board
The Company currently compensates its Directors at the rate
of $500.00 for each of the monthly meetings attended.
During 1998, the Board of Directors of the Company held
fifteen (15) meetings, while the Executive Committee held no
meetings.
The Executive Committee is one of two standing committees of
the Board of Directors. Messrs. Gaughan, Houssels, Dolesh, Jones
and Nolan have been members of the Executive Committee. The
Board does not have a Nominating Committee nor a Compensation
Committee. The Audit Committee was dissolved in 1997 following
The death of the sole member of that committee, former Director,
General Zack Taylor.
Mr. John D. Gaughan, through his ownership and position in
Exber, Inc. and through his ownership interest and position in
Union Plaza Hotel and Casino, Inc., directly controls 61% of the
Company's stock and is deemed a control person. (See information
in the following table under "Securities Ownership of Certain
Beneficial Owners and Management.")
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table contains information regarding beneficial
ownership, as defined in Footnote (1) to such table, of the
Company's capital stock as of March 19, 1999 by (1) each person
known to the Company to have such beneficial ownership of more
than five percent (5%) . . . of all such capital stock
outstanding on March 19, 1999 (which includes each director and
nominee), and (2) all officers and directors as a group.
<PAGE>
<TABLE>
<CAPTION>
Number of Shares and
Names and Addresses Nature of Beneficial
of Beneficial Owner Ownership (1) Percent of Class
<S> <C> <C>
EXBER, INC. 353,005 (3) 46.606%
600 E. Fremont Street
Las Vegas, NV 89101
J. K. HOUSSELS 88,600 (2) 11.698%
380 Rancho Circle
Las Vegas, NV 89107
JOHN D. GAUGHAN 449,397 (3) 61.653%
P. O. Box 680
Las Vegas, NV 89125
JIMMA LEE BEAM 97,512 12.874%
2409 Windjammer Way
Las Vegas, NV 89107
All officers and 198,892 26.154%
directors as a group
</TABLE>
(1) For purposes of this table, a person is regarded as having
beneficial ownership of shares in respect of which the person has
or shares the power to vote or to direct voting ("voting power")
or the power to dispose or to direct disposition ("investment
power"). Unless otherwise indicated by footnote, each person
named in the table has the sole voting power and the sole
investment power with respect to all the shares set forth
opposite the person's name.
(2) Includes 72,000 shares of record by Mr. J.K. Houssels, as
Trustee of Houssels 1998 Charitable Trust. Also includes 16,100
Shares owned of record by J.K. Houssels, as Trustee for Eric
Houssels and Kelley Claire Houssels, minor children of Mr.
Houssels, but does not include 5,550 shares owned by each of Mr.
Houssels' sons, John Kell Houssels, III and James O'Shaughnessy
Houssels.
(3) Includes 106,392 shares owned of record by John D. Gaughan,
as trustee of the Gaughan 1993 Marital Trust. Also includes
342,905 shares owned by Exber, Inc. Mr. Gaughan is the President,
and major shareholder of Exber, Inc.
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information concerning the
annual compensation for services in all capacities to the Company
for the years ended December 31, 1998, 1997 and 1996 of those
persons who were, at December 31, 1998, (1) Chief Executive
Officer, and (2) the other three most highly compensated executive
offices of the Company:
<TABLE>
<CAPTION>
Name and Salary & Director Insurance
Principal Position Year Bonus Fee Benefits Total
<S> <C> <C> <C> <C> <C>
JOHN D. GAUGHAN 1998 274 7,500 143 7,917
Chairman of the Board & 1997 0 6,000 143 6,413
Chief Executive Officer 1996 2,158 6,500 137 8,795
DON DOBSON 1998 50,988 7,500 285 58,773
Vice President & 1997 49,242 6,000 285 55,527
Secretary 1996 65,340 6,500 275 72,115
JOHN P. JONES 1998 46,552 7,500 178 54,230
Vice President & 1997 45,590 6,000 185 51,775
Treasurer 1996 65,953 6,500 178 72,631
LARRY DOLESH 1998 2,554 7,500 285 10,339
Vice President of 1997 0 6,000 285 6,285
Finance 1996 16,429 6,000 182 22,611
</TABLE>
Officers and certain other management personnel receive certain
other benefits in addition to cash compensation, however, the
aggregate value of such other benefits received by the above
individuals represents less than ten percent (10%) of the amount
of cash compensation of the recipient, and the aggregate value of
such benefits represents less than ten percent (10%) of the cash
compensation, paid to all executive officers as a group.
(1) Included in this column are salaries and bonuses (see "Bonus
Plan") below) paid or accrued during the year.
Profit Sharing and Bonus Plan
The Company has a profit sharing plan (the "Plan") which has
been in effect since July, 1971, and which was amended on
February 25, 1976, as a "Restated Plan and Trust Agreement" to
<PAGE>
comply with the requirements of the Employee Retirement Income
Security Act of 1974. The Plan was amended in December, 1984, to
comply with the mandatory "top-heavy" provisions of the Tax
Equity and Fiscal Responsibility Act of 1982. A top-heavy plan
is one in which sixty percent (60%) or more of the contributions
or benefits have been accumulated by key employees. If a plan is
found to be top-heavy, a plan participant's benefits must vest at
an accelerated rate either at twenty percent (20%) a year until
fully vested or under a "cliff vesting" schedule whereby the
participant is fully vested at the end of three (3) years. The
Company has adopted the cliff vesting schedule. This accelerated
vesting schedule becomes operative only if the Plan becomes
top-heavy. At the present time, the Plan is not top-heavy, nor
does the Company anticipate it to become top-heavy in the
foreseeable future. The Plan was restated December 18, 1991, to
meet the requirements of Section 401(a) and 501(a) of the
Internal Revenue Code of 1986. The Plan, as restated, has now
been approved as conforming with such code sections by the
Internal Revenue Service. The Plan is administered by Nevada
State Bank. The present Administrative Committee is Nevada State
Bank. Under the Plan, any employee of the Company who is at least
eighteen (18) years of age, is eligible to participate. However,
any employee covered by a collective bargaining agreement to
which the Company is a party is not eligible to participate if
the particular collective bargaining agreement does not expressly
provide for coverage of such employee under the Plan. As a
consequence of this provision, only the company's casino and
administrative employees are entitled to participate in the Plan.
The exact amount of each annual contribution to the Plan, within
statutory limits, is determined by the Company's Board of
Directors in its sole discretion. Annual contributions are
apportioned to the account of each participant in the same ratio
as the participant's total compensation (as defined) for the year
bears to the total compensation (as defined) for all participants
for that year. Contributions are deposited under a trust in
which each participant has a separate account. The Plan provides
that, at the discretion of the Committee, a portion of the
contribution to each participant's account may be used to
purchase insurance on the life of the participant or, if
uninsurable, a form of retirement annuity. The amounts in these
separate accounts (excluding such life insurance policies or
annuity contracts which vest immediately), vest at a rate of ten
percent (10%) per year (subject to accelerated vesting in the
event of the participant's death, permanent disability,
retirement or attainment of age sixty-five (65), or in the event
that the Plan is terminated or discontinued by the Company).
Investment of the trust fund by the trustee is subject to the
overriding supervision of the Administrative Committee,
which has absolute discretion regarding the types of investments
which are made from time to time. Not only may contributions to
the Plan be made by the Company in the form of shares of its
capital stock, but the Administrative Committee has power to
authorize the utilization of trust funds for the purpose of
purchasing shares of the Company's capital stock as investments.
Contributions, on an accrual basis, have been as follows:
$ -0- for 1998, $ -0- for 1997 and $300,000 for 1996.
Additionally, the Company has in effect an Executive Bonus
Plan (the "Bonus Plan"), pursuant to which a bonus "pool",
(historically limited to maximum of fifteen percent (15%) of the
Company's pre-tax net profits reduced by contributions to the
profit sharing plan described in the preceding paragraph) is
<PAGE>
distributed among certain directors, officers and key employees.
The Company's Board of Directors has exclusive discretion in
fixing the aggregate amount of each period's bonus pool within
the limitations described above, and in deciding which persons
will participate in that pool and the exact amount which each
such participant will receive from that pool, based on then
prevailing levels of regular compensation, performance and other
factors deemed relevant to the Board. The pools under the Bonus
Plan are typically determined on a monthly basis, with reference
to the results of operations for the immediately preceding
calendar month, and are distributed among participants within a
reasonable time following all necessary determinations. The
Company is not contractually obligated to continue the Bonus Plan
or to make any minimum allocation to it from time to time.
Amounts accrued under the Bonus Plan aggregated $34,924 for
1998, $ -0- for 1997 and $288,000 for 1996. A total of 48
persons received payments at the most recent distribution
under the Bonus Plan for 1998. Bonuses for officers and
directors pursuant to the Bonus Plan during 1998 are reflected in
the table under "Executive Compensation".
CERTAIN TRANSACTIONS WITH DIRECTORS AND OFFICERS
Exber, Inc. leases to the Company land and buildings in Las
Vegas, Nevada. Annual payments by the Company and its
subsidiaries are approximately $1,250,000.00. The major leases
extend through 2001 with renewals.
In February, 1993, Exber, Inc. made a loan of Eighteen
Million ($18,000,000.00) Dollars to the Company which was
utilized in partial payment of the outstanding loan, secured by
Deed of Trust, from Valley Bank of Nevada (now Bank of America)
and to satisfy an existing debt to Exber, Inc. of Three Million
($3,000,000.00) Dollars. The loan from Exber, Inc. in the total
amount of $25,500,000, is secured by a First Deed of Trust upon
the company property and bears interest at the prime rate and is
payable at $158,264.90 per month until July 2004 when the entire
principal and accrued interest is due in full.
<PAGE>
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The name of the principal accountants selected for the
current year is Gary Campbell, CPA, Ltd. who was appointed in
1991. A representative of this firm is expected to be present at
the stockholders' meeting to respond to appropriate questions and
to make a statement, if the representative deems it appropriate.
ANNUAL REPORT ON FORM 10-K
The Company's annual report to the Securities and Exchange
Commission on Form 10-K, including the financial statements and
schedules thereto, for the fiscal year ended December 31, 1998,
will be furnished without charge to any beneficial owner of
securities entitled to vote at this annual meeting. To obtain a
copy of the Form 10-K, written request must be made to the
Company and the written good faith representation must be
included that the requesting person was a beneficial owner
of securities entitled to vote at this annual meeting as of March
19, 1999. Requests should be addressed to: Union Plaza Hotel
and Casino, Inc., Attention: Mr. John D. Gaughan, Chairman, P.
O. Box 760, Number One Main Street, Las Vegas, Nevada 89125.
OTHER MATTERS
The Company's management does not know of any matters other
than those described above in this Proxy Statement which are
likely to come before the 1999 Annual Meeting of Stockholders.
However, if any other matter properly comes before the meeting,
it is intended that the persons named in accompanying form of
Proxy will vote on such matter all shares subject to unrevoked
Proxies in accordance with their best judgment.
STOCKHOLDER PROPOSALS
Proposals by stockholders to be acted upon at the
Stockholders Meeting of 2000 must be received by the Company on
or before January 1, 2000.
GENERAL
The cost of soliciting the enclosed form of Proxy will be
borne by the Company. Following the original mailing of the
Proxy soliciting material, regular employees of the Company may
solicit the enclosed form of Proxy by mail, telephone, telegraph
and personal interview.
By Order of the Board of Directors
/s/ DONALD DOBSON
DONALD DOBSON, Secretary
Dated: April 13, 1999
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC.
__________________________
PROXY
__________________________
FOR ANNUAL MEETING OF STOCKHOLDERS
MAY 21, 1999
The Undersigned, revoking all prior proxies, hereby appoints
John D. Gaughan, J.K. Houssels, John P. Jones, R.G. Taylor,
Larry E. Dolesh, Mike Nolan and Donald L. Dobson as proxies for
the undersigned, with full power of substitution, to vote all
shares of capital stock of Union Plaza Hotel and Casino, Inc.
Which the undersigned is entitled to vote at the Annual Meeting
of Stockholders of Union Plaza Hotel and Casino, Inc., to be held
in the Centerstage Restaurant area of the Union Plaza Hotel,
Number One Main Street, Las Vegas, Nevada, on Friday, May 21, 1999
beginning at 10:00 a.m., Las Vegas time, or at any adjournment
thereof, WITH__________ WITHOUT___________ authority to vote for
the election of directors, and upon such other business as may
properly come before the meeting or any adjournment thereof.
This proxy, if properly executed and delivered, will be
voted as directed, or if no direction is indicated, this proxy
will be deemed marked "FOR" all proposals and voted accordingly.
The undersigned hereby directs said proxies to vote:
Election of directors___________ FOR all nominees listed
below unless authority to vote for any nominee is withheld by
lining through the name of such nominee:
JOHN D. GAUGHAN JOHN P. JONES MIKE NOLAN F.
J.K. HOUSSELS I. KENNETH EPSTEIN
LARRY E. DOLESH DONALD L. DOBSON
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS OF UNION
PLAZA HOTEL AND CASINO, INC. THE UNDERSIGNED AGREES THAT SAID
PROXIES MAY VOTE IN ACCORDANCE WITH THEIR DISCRETION WITH RESPECT
TO ANY OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING.
SHOULD ANY NOMINEE FOR DIRECTOR BECOME UNAVAILABLE, DISCRETIONARY
AUTHORITY IS CONFERRED TO VOTE FOR A SUBSTITUTE. THE UNDERSIGNED
INSTRUCTS SUCH PROXIES TO VOTE AS DIRECTED ABOVE.
The proxy should be dated, signed by Stockholder
exactly as printed at the left and returned promptly
in the enclosed envelope. Persons signing in a
fiduciary capacity should so indicate.
Dated:__________________________, 1999
____________________________________
Signature
____________________________________
Signature
<PAGE>
