CEO purchases $3.5 million in stock

Friday, April 21, 2000 | 11:03 a.m.

Riviera Holdings Corp. of Las Vegas said Chairman and Chief Executive William Westerman purchased 346,000 shares of company stock from the company's largest shareholder.

Westerman paid $3.5 million for the stock, or $7.50 per share, to New York investment firm Morgens Waterfall Vintiadis & Co. Inc. The purchase represents about 12 percent of the company's outstanding shares.

Morgens Waterfall has been embroiled in a bitter legal battle with Riviera over the company's settlement of a lawsuit brought by California businessman Allen Paulson, who terminated an agreement to acquire Riviera in 1998. Paulson claimed he was duped into buying a financially struggling company by Riviera and its largest shareholders, including Morgens Waterfall.

Riviera approved a $9.4 million settlement with Paulson in October 1999, but this settlement didn't indemnify Morgens Waterfall.

In March, Morgens Waterfall reported a stake of 485,000 shares of Riviera stock, a decrease of 635,000 shares from its February report. Riviera's announcement did not indicate if Westerman was the buyer of the shares sold in March, or if Morgens Waterfall had sold more of its stake in Riviera.