UPDATE ON SALE OF MAXIM HOTEL AND CASINO

Source: Premier Interval Resorts

May 23, 1999
In an update on yesterday's story about the sale of the Maxim hotel and casino, the new owners have plans to transform about 500 of the off-Strip property's 800 hotel units into timeshares. Premier Interval Resorts will then lease the property's casino and the remaining 300 hotel rooms to a group of West Virginia horse track operators who own the recently opened the Speedway Hotel & Casino, 3227 Civic Center Dr., North Las Vegas.

The race track owners, who have applied for a Nevada gaming license under the name of Speakeasy Gaming of Las Vegas Inc., will operate the hotel rooms as well as the casino, sources said.

In April 1998, West Coast foreclosed on the 800-room Maxim and signed a five-year lease with longtime Las Vegas casino executive Ed Nigro. The lease agreement called for the first $3 million of annual cash flow to be reinvested in the property during the ensuing five years. But a clause in the agreement allowed West Coast Mortgage to end the deal if a buyer came along. In return, Nigro would receive a termination fee.

According to gaming control board records, Speakeasy Gaming is owned by MTR Gaming Group, owners of Mountaineer Mountaineer Park & Gaming Resort. The track is located about 60 miles north of Wheeling, W. Va., and has about 1,300 video lottery terminals and 101 hotel rooms. Speakeasy Gaming's corporate officers are listed as Edson Arneault and Bruce Dewing, according to control board records.

Sources said West Coast Mortgage had five serious bidders for the Maxim, which emerged in April 1998 from a series of legal disputes involving California tomato grower John Anderson. West Coast Mortgage foreclosed on the property after Anderson failed to honor a $42 million note it was owed. Anderson bought the Maxim in 1981 for $60 million. He later pledged his stock in the hotel to Eureka Federal Savings and Loan Association. The S&L failed, and the FDIC took control of the financial institution. West Coast started foreclosure proceedings after the casino defaulted on the $42 million loan.

The key players in Premier Interval Resorts are General Counsel Tom Russell, Florida time-share developer Hillel Meyers, Coloradan Gary Kornman and Californian Don Saunders.