Friday, Aug. 29, 1997 | 9:58 a.m.
Bob Stupak may have lost a job, paper profits and a measure of credibility as the Stratosphere saga unfolds, but he hasn't lost his penchant for promoting himself.
Yet some gaming executives wonder what Stupak hoped to gain from his bizarre threat to attack Stratosphere directors using air time he bought on a local television station Thursday.
Stupak "postponed" his scheduled half-hour videotape assault on four of Stratosphere's five directors for undisclosed reasons, a KFBT Channel 33 spokesman said.
The postponement came after Stratosphere's board agreed to let Stupak, on Sept. 5, present a new bankruptcy reorganization plan for the company he once chaired.
But Stratosphere directors doubt Stupak actually has a formal plan that would survive court scrutiny. Some observers are skeptical Stupak could raise the financing needed to compete with other restructuring plans offered by investor Carl Icahn or Grand Casinos Inc., or that Stupak would survive a licensing procedure before state gaming regulators.
"Do you really think he can raise $100 million for a new room tower?" asked one skeptic who requested anonymity. "Come on."
Stupak himself couldn't be reached for comment.
The latest flap surrounding Stupak, who has incurred the wrath of regulators throughout the years, began last week when he called a Stratosphere executive and asked to meet to discuss a new restructuring plan for the company that's been in Chapter 11 bankruptcy proceedings for months.
In hours of meetings that stretched over two days, Stupak "never explained what his plan was," said a source familiar with the discussions.
"He was never able to explain how he'd put together a plan that the court would confirm or how he'd make the bondholders whole," the source said.
When Stupak requested a meeting with Stratosphere directors, the executive asked him to submit a "term sheet" describing the reorganization plan so the company's financial advisers and attorneys could study it and make a recommendation to the board.
"He never submitted one to us," the source said. "Instead, he comes up with this threat to attack the board on TV."
In the videotape, Stupak reportedly criticized or questioned the actions of four Stratosphere board members. The only one he didn't mention was his nominee to the board, Tom Hantges.
Hantges is president of USA Capital Corp., which handled the sale of millions of Stupak's Stratosphere stock as the price was plummeting from its peak of $14 a share to its current price of less than 50 cents.
Some observers find a certain irony in Stupak's reported chastising of the Stratosphere board for failing to perform its fiduciary duties.
"Instead of paying for TV time, it seems to me Bob might find a better use for his money in discharging his obligations to Stratosphere vacation-package holders, as he promised," said state Gaming Control Board Chairman Bill Bible.
Last month, Stupak got into hot water over a letter he sent to more than 19,000 people who bought vacation packages from his old Vegas World hotel-casino and who are now plaintiffs in a class-action lawsuit against him.
The packages, sold to help finance Stupak's plan to build what eventually became the Stratosphere Tower, promised purchasers a chance to spend time at the resort.
Bible said there's no condition on Stupak's license as a controlling shareholder of Stratosphere that would preclude him from taking a more active role in the company's day-to-day operations.
"But he did tell both the Control Board and the Nevada Gaming Commission he would have no role in the management or marketing of Stratosphere," he said.
"In any event, the licensing matter for anyone ultimately involved in management would be considered when Stratosphere emerges from bankruptcy, because further regulatory approvals are necessary for the plan to become effective."
Whether the restructuring proposal ultimately accepted comes from Icahn, Grand or another party won't be decided for months. But few are betting that Stupak will prevail.
"We've asked for whatever his so-called plan is, but we've never seen one," said Stratosphere Chief Financial Officer Tom Lettero.
"This is just more Stupak nonsense," said Stratosphere General Counsel Andrew Blumen.
"The board agreed to let Bob give a presentation a week from Friday," said Blumen. "Based upon his current actions, I for one am not quite sure I'm interested in listening to Mr. Stupak's presentation."
So what is the flap all about? Some suspect it's yet another Stupak attempt to shift focus away from his woes with vacation-package holders.
"It's the world's biggest misdirection move," said one observer.
But it may just be more self-promotion, a bid to forge a TV career with his own entertainment venture. The program Stupak's tape was scheduled to pre-empt, after all, was a rerun of "The Beverly Hillbillies."
archive
