Group criticizes Circus board

Wednesday, June 2, 1999 | 10:59 a.m.

A New York proxy monitoring service is recommending that shareholders of Circus Circus Enterprises Inc. withhold votes for directors at the company's June 17 annual meeting.

Proxy Monitor, a proxy research and vote recommendation service, said only four of Circus Circus' current eight directors qualify as independent directors. Neither of the two directors up for election, William A. Richardson or Donna B. More, meet Proxy Monitor's test of independence.

Proxy Monitor said Richardson is the company's vice chairman and is paid $700,000 in annual compensation. More is a partner in the company's outside law firm.

"We might be more supportive of current directors if the board had done a good job," James E. Heard, chief executive of Proxy Monitor, said in a statement. "But returns to shareholders over the past five years have been extremely disappointing. It's definitely time for a change."

Proxy Monitor is also recommending shareholders support two proxy proposals submitted by shareholders. One, sponsored by the California Public Employees Retirement System, would require that a majority of the company's board consist of independent directors. The second, sponsored by shareholder Charles Miller, would require the election of all directors annually. Circus Circus directors are currently elected to overlapping three-year terms.

"We believe that adoption of these resolutions will encourage greater independence and greater accountability at Circus Circus, and this in turn will help to reverse the company's dismal performance," said Heard.

Circus Circus officials could not immediately be reached for comment.

Proxy Monitor is silent on a third proxy proposal, sponsored by shareholder William Steiner, that would require the company to promptly sell itself to the highest bidder.

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