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Elsinore Corp – ‘10-Q’ for 9/30/03

On: Friday, 11/7/03, at 9:35am ET · For: 9/30/03 · Accession #: 311049-3-15 · File #: 1-07831

  As Of                Filer                Filing    For·On·As Docs:Size

11/07/03  Elsinore Corp                     10-Q        9/30/03    1:89K

Quarterly Report — Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Elsinore Corp 10Q for the Period Ending 9/30/03       36    172K

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Controls and Procedures Discontinued Operations Exhibits and Reports on Form 8-K Management's Discussion and Analysis of Financial Condition and Results of Operations Submission of Matters to a Vote of Security Holders
1	1st Page - Filing Submission
13	Item 2:. Management's Discussion and Analysis of Financial Condition and Results of Operations
14	Discontinued Operations
22	Item 4. Controls and Procedures
23	Item 4. Submission of Matters to a Vote of Security Holders
"	Item 6. Exhibits and Reports on Form 8-K

10-Q 1st Page of 36 TOC ↑Top Previous Next ↓Bottom Just 1st
 
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 FORM 10-Q
(MARK ONE)

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities        
Exchange Act of 1934 for the quarterly period ended September 30, 2003

or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities         
Exchange Act of 1934 for the transition period from ___________________ 
to ___________________                                                

 Commission File Number 1-7831

ELSINORE CORPORATION
--------------------
(Exact name of registrant as specified in its charter)

     Nevada                                       88-0117544
     ------                                       ----------
(State or Other Jurisdiction                        (IRS Employer   
  of Incorporation or Organization)                Identification No.)

2330 PASEO DEL PRADO, SUITE C308, LAS VEGAS, NEVADA  89102
----------------------------------------------------------
(Address of Principal Executive Offices)        (Zip Code)

702/387-5115
------------
 Registrant's Telephone Number (Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports         
required to be filed by Section 13 or 15(d) of the Securities Exchange Act      
of 1934 during the preceding 12 months (or for such shorter period that the     
registrant was required to file such reports), and (2) has been subject to      
such filing requirements for the past ninety (90) days.                         

YES  X          NO        
---            ---

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer    
(as defined in Exchange Act Rule 12b-2).                                        

YES             NO  X     
---            ---

____________________________________________
Former Address, if changed since last report

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.                                

  TITLE OF STOCK                                        NUMBER OF SHARES
    CLASS                         DATE                   OUTSTANDING
  --------------              ----------------          ----------------
    Common                  November 5, 2003               4,993,965

10-Q 2nd Page of 36 TOC 1st Previous Next ↓Bottom Just 2nd
 Elsinore Corporation and Subsidiaries
 Form 10-Q
For the Quarter Ended September 30, 2003

 INDEX
  ------

PART I.  FINANCIAL INFORMATION:                                     PAGE        
------------------------------                                      ----        
Item 1.  Unaudited Condensed Consolidated Financial Statements:                 

Condensed Consolidated Statement of Net Assets in             
Liquidation (liquidation basis) as of September 30,           
2003 and Condensed Consolidated Balance Sheet                 
(going concern basis) as of December 31, 2003                3

Condensed Consolidated Statements of Operations               
for the Three Months ended September 30, 2003                 
(liquidation basis) and September 30, 2002                    
(going concern basis)                                        4

Condensed Consolidated Statements of Operations               
for the Nine Months ended September 30, 2003                  
(liquidation basis) and September 30, 2002                    
(going concern basis)                                        5

Condensed Consolidated Statement of Changes in                
Net Assets for the Nine Months ended                          
September 30, 2003 (liquidation basis)                       6

Condensed Consolidated Statements of Cash Flows for           
the Nine Months Ended September 30, 2003 and                  
September 30, 2002                                           7

Notes to Condensed Consolidated Financial Statements         8

Item 2.  Management's Discussion and Analysis of                                
Financial Condition and Results of Operations               13

Item 3.  Quantitative and Qualitative Disclosures                               
About Market Risk                                           22

Item 4.  Controls and Procedures                                     22         

PART II. OTHER INFORMATION:                                                     
--------------------------                                                      

Item 4.  Submission of Matters to a Vote of Security                            
Holders                                                     23

Item 6.  Exhibits and Reports on Form 8-K                            23         

SIGNATURES                                                           25         

EXHIBITS                                                             26         

10-Q 3rd Page of 36 TOC 1st Previous Next ↓Bottom Just 3rd
PART I.  FINANCIAL INFORMATION                                                  
Item 1.  Consolidated Financial Statements                                      

                                                        [Enlarge/Download Table]

                                                Elsinore Corporation and Subsidiaries                                   
                             Condensed Consolidated Statement of Net Assets in Liquidation (Liquidation                 
                              Basis) as of September 30, 2003 and Condensed Consolidated Balance Sheet                  
                                           (Going Concern Basis) as of December 31, 2002                                

                                                               Unaudited                                                
                                                        (Dollars in Thousands)                                          

                                                                           September 30,              December 31,      
                                                                                2003                      2002          
                                                                        (Liquidation Basis)      (Going Concern Basis)  
                                                                        ---------------------    -----------------------
                                Assets                                                                                  
Current Assets:                                                                                                         
                                                                                                                        
  Cash and cash equivalents                                                           $9,195                     $1,795 
  Accounts receivable, net                                                                13                         15 
  Prepaid expenses                                                                       104                         61 
  Assets of discontinued operations                                                                                     
    held for sale                                                                          -                     32,215 
                                                                        ---------------------    -----------------------
    Total current assets                                                               9,312                     34,086 

Equipment                                                                                  2                          - 
Other assets                                                                           1,051                         10 
                                                                        ---------------------    -----------------------
    Total assets                                                                     $10,365                    $34,096 
                                                                        =====================    =======================

                Liabilities and Shareholders' Equity                                                                    

Current liabilities:                                                                                                    
  Accrued interest                                                                       $-                        $317 
  Accrued expenses                                                                    1,451                          31 
  Current portion of long-term debt                                                       -                           8 
  Liabilities of discontinued operations                                                                                
    held for sale                                                                         -                       7,353 
                                                                       ---------------------     -----------------------
     Total current liabilities                                                        1,451                       7,709 

Long-term debt, less current portion                                                      -                       7,104 
                                                                       ---------------------     -----------------------
     Total liabilities                                                                1,451                      14,813 
                                                                       ---------------------     -----------------------

Commitments and contingencies                                                                                           

Shareholders' Equity:                                                                                                   
6% cumulative convertible preferred stock, no par value.                                                                
Authorized, issued and                                                                                                  
  outstanding 50,000,000 shares.                                                          -                      23,066 
Common stock, $.001 par value per share.                                                                                
  Authorized 100,000,000 shares.  Issued                                                                                
  and outstanding 4,993,965 shares at                                                                                   
  September 30, 2003 and December 31, 2002,                                                                             
  respectively.                                                                           -                           5 

Additional paid-in capital                                                                -                       4,571 
Accumulated deficit                                                                       -                     (8,359) 
                                                                       ---------------------     -----------------------
     Total shareholders' equity                                                           -                      19,283 
                                                                       ---------------------     -----------------------

     Total liabilities and shareholders'                                                                                
     equity                                                                                                     $34,096 
                                                                                                 =======================

Net Assets in Liquidation                                                            $8,914                             
                                                                       =====================                            

See accompanying notes to the condensed consolidated financial statements.                                              

10-Q 4th Page of 36 TOC 1st Previous Next ↓Bottom Just 4th
                                                        [Enlarge/Download Table]

                                                 Elsinore Corporation and Subsidiaries                           
                                            Condensed Consolidated Statements of Operations                      
                                   for the Three Months ended September 30, 2003 (Liquidation Basis)             
                                             and September 30, 2002 (Going Concern Basis)                        
                                                               Unaudited                                         
                                           (Dollars in Thousands, Except Per Share Amounts)                      

                                                                      Three                       Three          
                                                                      Months                     Months          
                                                                      Ended                       Ended          
                                                                September 30, 2003         September 30, 2002    
                                                                   (liquidation              (going concern      
                                                                      basis)                     basis)          
                                                              -----------------------    ------------------------
Revenues:                                                                                                        
                                                                                                                 
 Other, non-operating                                                            $15                        $113 
                                                              -----------------------    ------------------------
   Total revenues                                                                 15                         113 
                                                              -----------------------    ------------------------

Costs and expenses:                                                                                              
 Selling, general and                                                                                            
  administrative                                                               1,061                          98 
 Interest                                                                         44                         228 
 Merger and litigation costs, net                                                  -                          14 
                                                              -----------------------    ------------------------
   Total costs and expenses                                                    1,105                         340 
                                                              -----------------------    ------------------------
   Loss from continuing operations                                           (1,090)                       (227) 

   Income from discontinued                                                                                      
    operations                                                                   249                         149 
                                                              -----------------------    ------------------------
    Net loss                                                                    (841)                        (78)

 Undeclared dividends on cumulative                                                                              
  convertible preferred stock                                                    180                         322 
                                                              -----------------------    ------------------------

   Net loss applicable                                                                                           
    to common shares                                                        ($1,021)                      ($400) 
                                                              =======================    ========================

Basic and diluted loss                                                                                           
 per common share:                                                                                               

Basic and diluted loss per                                                                                       
  share before discontinued operations                                        ($.25)                      ($.11) 
                                                              =======================    ========================

Basic and diluted loss per share                                                                                 
  after discontinued operations                                               ($.20)                      ($.08) 
                                                              =======================    ========================

Weighted average number of                                                                                       
 common shares outstanding                                                 4,993,965                   4,993,965 
                                                              =======================    ========================

See accompanying notes to condensed consolidated financial statements.                                           

10-Q 5th Page of 36 TOC 1st Previous Next ↓Bottom Just 5th
                                                        [Enlarge/Download Table]

                                                 Elsinore Corporation and Subsidiaries                           
                                            Condensed Consolidated Statements of Operations                      
                                   for the Nine Months ended September 30, 2003 (Liquidation Basis)              
                                              and September 30, 2002 (Going Concern Basis                        
                                                               Unaudited                                         
                                           (Dollars in Thousands, Except Per Share Amounts)                      

                                                                       Nine                       Nine           
                                                                      Months                     Months          
                                                                      Ended                       Ended          
                                                                September 30, 2003         September 30, 2002    
                                                                   (liquidation              (going concern      
                                                                      basis)                     basis)          
                                                              -----------------------    ------------------------
Revenues:                                                                                                        
                                                                                                                 
 Other, non-operating                                                            $15                        $454 
                                                              -----------------------    ------------------------
   Total revenues                                                                 15                         454 
                                                              -----------------------    ------------------------
Costs and expenses:                                                                                              
 Selling, general and                                                                                            
  administrative                                                               1,416                         423 
 Interest                                                                        376                         684 
 Merger and litigation costs, net                                                  -                       1,003 
                                                              -----------------------    ------------------------
   Total costs and expenses                                                    1,792                       2,110 
                                                              -----------------------    ------------------------
   Loss from continuing operations                                           (1,777)                     (1,656) 

   Income (loss) from discontinued                                                                               
    operations                                                               (2,731)                       2,452 
                                                              -----------------------    ------------------------
   Net income (loss)                                                         (4,508)                         796 

 Undeclared dividends on cumulative                                                                              
  convertible preferred stock                                                    862                         965 
                                                              -----------------------    ------------------------
   Net loss applicable                                                                                           
    to common shares                                                        ($5,370)                      ($169) 
                                                              =======================    ========================

Basic and diluted loss                                                                                           
 per common share:                                                                                               

Basic and diluted loss per                                                                                       
  share before discontinued operations                                        ($.53)                      ($.52) 
                                                              =======================    ========================

Basic and diluted loss per share                                                                                 
  after discontinued operations                                              ($1.08)                      ($.03) 
                                                              =======================    ========================

Weighted average number of                                                                                       
 common shares outstanding                                                 4,993,965                   4,993,965 
                                                              =======================    ========================

See accompanying notes to condensed consolidated financial statements.                                           

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                                                        [Enlarge/Download Table]

                                                 Elsinore Corporation and Subsidiaries             
                                       Condensed Consolidated Statement of Changes in Net Assets   
                                   for the Nine Months ended September 30, 2003 (Liquidation Basis)
                                                               Unaudited                           
                                                        (Dollars in thousands)                     

                                                                                                   
             Net Assets, January 1, 2003                                       $19,283             

             Net Loss                                                          (4,508)             

             Preferred stock dividends paid                                    (5,861)             
                                                                 ----------------------            
             Net Assets, September 30, 2003                                     $8,914             
                                                                 ======================            

See accompanying notes to condensed consolidated financial statements.                             

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                                                        [Enlarge/Download Table]

                                                 Elsinore Corporation and Subsidiaries                                 
                                            Condensed Consolidated Statements of Cash Flows                            
                                                               Unaudited                                               
                                                        (Dollars in Thousands)                                         

                                                                                Nine                     Nine          
                                                                               Months                   Months         
                                                                                Ended                    Ended         
                                                                         September 30, 2003       September 30, 2002   
                                                                            (liquidation            (going concern     
                                                                               basis)                   basis)         
                                                                        ----------------------  -----------------------
Cash flows used in operating                                                                                           
                                                                                                                       
   activities                                                                        ($1,756)                 ($1,585) 

Cash flows provided by (used in) investing                                                                             
   activities -                                                                                                        

   Capital expenditures                                                                   (2)                        - 

   Sale of Stock of Four Queens                                                        20,500                        - 

Cash flows used in financing                                                                                           
   activities -                                                                                                        

   Principal payments on                                                                                               
   long-term debt                                                                     (7,112)                      (3) 

   Payment of preferred stock dividend                                                (5,861)                        - 

Cash flows provided by (used in)                                                                                       
   discontinued operations                                                              1,631                    2,202 
                                                                        ----------------------  -----------------------

  Net increase in cash and                                                                                             
    cash equivalents                                                                    7,400                      614 

  Cash and cash equivalents at beginning                                                                               
    of period                                                                           1,795                      451 
                                                                        ----------------------  -----------------------

  Cash and cash equivalents at end                                                                                     
    of period                                                                          $9,195                   $1,065 
                                                                        ======================  =======================

Supplemental disclosure of cash activities:                                                                            

  Cash paid for interest                                                                  $692                    $911 
                                                                        ======================  =======================

See accompanying notes to condensed consolidated financial statements.                                                 

10-Q 8th Page of 36 TOC 1st Previous Next ↓Bottom Just 8th
 Elsinore Corporation and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Liquidation Basis)
September 30, 2003
 (Unaudited)

1.    Summary of Significant Critical Accounting Policies                       

Principles of Consolidation                                                     

     The  consolidated  financial  statements  include the  accounts of Elsinore
Corporation ("Elsinore" or the "Company") and its wholly owned subsidiaries. All
material   intercompany  balances  and  transactions  have  been  eliminated  in
consolidation.                                                                  

Basis of Presentation                                                           

     The Company has prepared the accompanying  unaudited condensed consolidated
financial  statements,  pursuant to rules and  regulations of the Securities and
Exchange  Commission.  Certain  information  and footnote  disclosures  normally
included  in  financial   statements  prepared  in  accordance  with  accounting
principles  generally  accepted  in the  United  States  of  America  have  been
condensed  or omitted  pursuant to such rules and  regulations.  It is suggested
that this report be read in conjunction with the Company's audited  consolidated
financial  statements  included in the annual report for the year ended December
31, 2002. In the opinion of management,  the accompanying condensed consolidated
financial  statements  contain  all  adjustments,   consisting  only  of  normal
recurring  adjustments,  necessary  to present  fairly the  Company's  financial
position as of September 30, 2003,  the results of its  operations for the three
and nine months ended September 30, 2003 and September 30, 2002, and the results
of its cash flows for the nine months ended September 30, 2003 and September 30,
2002. The operating results and cash flows for these periods are not necessarily
indicative  of the results that will be achieved for the full year or for future
periods.                                                                        

     On April 29, 2003, the Company  announced that it entered into a definitive
stock purchase  agreement (the "Stock  Purchase  Agreement") for the sale of all
the capital stock of Four Queens,  Inc.  ("Four Queens") and its interest in the
Fremont Street Experience,  LLC, to TLC Casino  Enterprises,  Inc. ("TLC") for a
purchase price of approximately $20.5 million.                                  

     In  connection  with the  execution of the Stock  Purchase  Agreement,  the
Company recognized a non-cash impairment loss of approximately $5 million, which
was  necessary  as the  carrying  values of the assets to be sold as of June 30,
2003 were greater than the fair market value of the assets. Depreciation expense
on the assets  owned by Four Queens  ceased as of April 29,  2003,  the date the
Four Queens' assets were classified as held for sale.                           

     The  assets and  liabilities  of Four  Queens  have been  presented  in the
December  31, 2002  balance  sheet as assets  held for sale.  In  addition,  the
results of  operations of Four Queens for the three and nine month periods ended
September  30, 2003 and 2002 have been  presented  as  discontinued  operations.
Discontinued  operations were also presented to include a subsequent  adjustment
to the write-down of the investment in the capital stock of Four Queens relating
to the results of operations  during the quarter ended September 30, 2003 in the
amount of $104,000.                                                             

The sale of Four Queens was consummated on July 31, 2003.             

10-Q 9th Page of 36 TOC 1st Previous Next ↓Bottom Just 9th
     The board of directors has approved a plan of liquidation and  dissolution.
As a result, the Company's financial statements as of September 2003 and for the
period then ended have been  prepared on the  liquidation  basis of  accounting.
There was no  adjustment  necessary  to present the net assets of the Company at
liquidation value.                                                              

Plan of Liquidation and Dissolution                                             

     After the plan of liquidation and dissolution is approved by  shareholders,
the Company will file a certificate of dissolution  with the Nevada Secretary of
State and will no longer engage in any business  activities except to the extent
necessary  or  appropriate  to  preserve  the value of its  assets,  wind up its
business  affairs,  distribute  its assets in accordance  with the plan and take
such  other  actions  permitted  or  required  under  Nevada  law for  dissolved
corporations.  The Company expects that its principal activities will consist of
liquidating  and  distributing  its assets in order to satisfy  (or  establish a
reserve for) its obligations and liabilities,  and distributing the remainder to
its shareholders.                                                               

     In connection  with the  distribution to  shareholders,  the holders of the
Company's  Series A Preferred  Stock  ("Preferred  Stock") have expressed  their
intent to authorize  and request the Company to make a special  distribution  of
$0.10 per share to holders of the Company's common stock ("Common Stock") out of
the assets that would otherwise be  distributable to holders of Preferred Stock.
Absent such action by the holders of  Preferred  Stock (or  conversion  of their
Preferred Stock to Common Stock, which they have expressed an intent not to do),
the  liquidation  preference of the Preferred Stock would entitle the holders of
Preferred Stock to the entire distribution to shareholders.                     

Recently Issued Accounting Standard                                             

     In May 2003, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting  Standards  No. 150,  "Accounting  for  Certain  Financial
Instruments with Characteristics of both Liabilities and Equity." This Statement
establishes  standards  for  how  an  issuer  classifies  and  measures  certain
financial  instruments with  characteristics  of both liabilities and equity. It
requires that an issuer classify a financial instrument that is within its scope
as a liability (or an asset in some circumstances).  This Statement is effective
for  financial  instruments  entered into or modified  after May 31,  2003,  and
otherwise is effective at the  beginning of the first interim  period  beginning
after June 15, 2003. The Company  adopted this standard on July 1, 2003, and the
adoption did not have a material impact on its financial position and results of
operations.                                                                     

Net Income Per Common Share                                                     

     Basic per share  amounts are  computed  by  dividing  net income by average
shares  outstanding  during the year.  Diluted per share amounts are computed by
dividing net income by average shares  outstanding  plus the dilutive  effect of
common share  equivalents.  Since the Company  incurred net losses for the three
and nine month  periods  ended  September  30, 2003 and the three and nine month
periods ended  September 30, 2002,  the effect of common stock  equivalents  was
anti-dilutive.  Therefore,  basic and diluted per share amounts are the same for
this period.                                                                    

2.   Discontinued Operations                                                    

     The  following is a summary of the assets and  liabilities  of Four Queens,
which have been  included  in the  balance  sheet as assets and  liabilities  of
discontinued operations held for sale (in thousands):                           

                                              December 31,
                                              2002
                                               ---------------------
Cash and cash equivalents                                          $4,538       
Accounts receivable                                                   401       
Other current assets                                                1,803       
Property and equipment, net                                        23,515       
Other assets                                                        1,958       
                                               ---------------------

Assets of discontinued operations                                               
held for sale                                                   $32,215     
                                               =====================

Accounts payable                                                     $848       
Accrued expenses                                                    4,577       
Long-term debt and other obligations                                1,928       
                                               ---------------------

Liabilities of discontinued operations                                          
held for sale                                                    $7,353     
                                               =====================

10-Q 10th Page of 36 TOC 1st Previous Next ↓Bottom Just 10th
     The  following  is a summary of the results of  operations  of Four Queens,
which have been included in the  statement of operations  for the three and nine
month  periods  ended  September  30,  2003 and 2002 as net income  (loss)  from
discontinued operations (in thousands):                                         

                                                        [Enlarge/Download Table]

                                Three Months Ended               Nine Months Ended       
                                  September 30,                    September 30,         
                           -----------------------------  -------------------------------
                               2003            2002           2003               2002    
                           -------------    ------------  --------------    -------------
                                                                                         
Total revenues, net              $4,608         $13,022          32,902          $39,806 

Total costs and expenses          4,463          12,873          30,727           37,030 
                           -------------    ------------  --------------    -------------
Income from discontinued                                                                 
  operations                        145             149           2,175            2,776 
Impairment loss on assets                                                                
  held for sale                   (104)               -           4,906              324 
                           -------------    ------------  --------------    -------------
Income (loss) from                                                                       
  discontinued operations          $249            $149        ($2,731)           $2,452 
                           =============    ============  ==============    =============

     The income from discontinued  operations increases the Company's investment
in Four Queens, but is eliminated upon consolidation. However, since the Company
sold all of the  capital  stock it held in Four Queens on July 31,  2003,  which
constituted  substantially all of assets of the Company, for a fixed sales price
of $20.5 million, the Company recorded an impairment adjustment during the three
months  ended  September  30,  2003  equal  to the  amount  of net  income  from
discontinued  operations of Four Queens less $298,000 of cash  transferred  from
Four Queens to the Company during the period.                                   

3.   Income Taxes                                                               

     Due to the Company's regular tax and alternative  minimum tax net operating
losses,  the Company is not  expected to pay federal  income  taxes for the year
ended December 31, 2003.  Accordingly,  the Company has not recorded a provision
for  income  taxes  in  the  accompanying   Condensed   Consolidated   Financial
Statements.                                                                     

4.   Commitments and Contingencies                                              

     Philip W. Madow (the former  President)  and Gina L.  Contner  Mastromarino
(the  former  Executive  Director  of  Finance)  of Four  Queens had  employment
agreements  with Four Queens which became  effective on January 1, 2003.  In the
event of a change of ownership or control,  Mr. Madow and Ms.  Mastromarino  had
the option to elect to be  employed  with the entity or person  having  acquired
such  control  or  terminate  their  respective  employment  agreement.  If  the
executives  elected to terminate their respective  employment  agreements upon a
change of  ownership  or control,  Four Queens  would pay an amount equal to one
year's base salary and COBRA  benefits.  "Change of ownership or control"  meant
that all or  substantially  all of the assets of Four  Queens are  directly,  or
through transfer of equity  interests,  transferred or otherwise  disposed of in
one or a series of related  transactions after (1) the Four Queens ceased to own
directly or  indirectly  substantially  all equity  interests in the Four Queens
Hotel &  Casino;  (2) Four  Queens  sold 51% or more of the  assets  of the Four
Queens Hotel & Casino;  or (3) the Company  ceased to own directly or indirectly
at least 51% of all outstanding  shares of Four Queens.  The President's  annual
compensation pursuant to his employment agreement was $255,000 and the Executive
Director of Finance's  annual  compensation  under her employment  agreement was
$145,000. These employment agreements were required to be terminated pursuant to

10-Q 11th Page of 36 TOC 1st Previous Next ↓Bottom Just 11th
the Stock Purchase Agreement,  prior to consummation of the sale of Four Queens.
On July 31, 2003 the employment  agreements were terminated and the sale of Four
Queens  was  consummated.  The  Company  has  assumed  the  liability  under the
employment agreements.                                                          

     In order to ensure  retention  of key  individuals  required to complete an
orderly  dissolution,  the Company has entered into  compensation  and retention
arrangements with Joann McNiff (the sole director and executive  officer),  Gina
L. Contner  Mastromarino (the principal  accounting officer) and Philip W. Madow
(the former President and now a consultant).  The retention arrangements for Mr.
Madow and Ms. Mastromarino  provide for, among other things,  payment of $75,000
to each of them for up to a 15-month period  following the July 31, 2003 closing
of the Stock  Purchase  Agreement for remaining in their present roles until the
Company completes the dissolution process. Ms. McNiff's arrangement provides for
compensation  of $3,000 per month for  serving  as the  Company's  director  and
executive  officer for the period from August 1, 2003 through the  completion of
the dissolution process.                                                        

     The Company is a party to claims and  lawsuits  that arose in the  ordinary
course of business.  Management believes that such matters are either covered by
insurance,  or if not insured,  will not have a material  adverse  effect on the
financial statements of the Company taken as a whole.                           

5.   Impairment Losses                                                          

     On March 14, 2002,  the Company  entered into the Purchase  Agreement  with
SummerGate  pursuant to which Four Queens proposed to sell  substantially all of
its assets to SummerGate,  the Company recognized a non-cash  impairment loss of
approximately  $13.2 million during 2001 and an impairment loss of approximately
$324,000,  in the first  quarter of 2002,  due to the  amendment of the Purchase
Agreement.                                                                      

On June 27, 2002, Four Queens terminated the Purchase Agreement.      

     On April 29,  2003,  the Company  announced  that it entered into the Stock
Purchase  Agreement for the sale of all the capital stock of Four Queens and its
interest in the Fremont Street  Experience,  LLC, to TLC for a purchase price of
$20.5 million.                                                                  

     On July 31, 2003, the sale of Four Queens was consummated.  Four Queens was
Elsinore's  sole  operating  asset  and the  capital  stock of Four  Queens  was
substantially   all  of  Elsinore's   assets.   Elsinore's  board  of  directors
anticipates winding up and dissolving  Elsinore.  Elsinore used a portion of the
proceeds from the sale to pay off Elsinore's  outstanding  12.83% Mortgage Notes
("Notes"),  and to pay all accrued and unpaid  dividends on the Preferred  Stock
through July 31, 2003. At August 1, 2003,  immediately  before the payments were
made,  Elsinore  had  $5,380,489  in  principal  amount and  accrued  but unpaid
interest  outstanding  on the Notes  and had  outstanding  50,000,000  shares of
Preferred Stock, with accrued and unpaid dividends of $5,860,815.               

     In connection with the Stock Purchase  Agreement,  the Company recognized a
non-cash  impairment  loss of  approximately  $4.9 million during the first nine
months of 2003. An impairment  loss was necessary  under  Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long
Lived Assets"  ("SFAS No. 144"),  as the carrying  value of the net assets to be
sold as of September  30, 2003 ($24.9  million) was greater than the fair market
value of the net assets ($20.5  million).  In accordance  with SFAS No. 144, the
Company ceased depreciation of these assets on April 29, 2003.                  

10-Q 12th Page of 36 TOC 1st Previous Next ↓Bottom Just 12th
     The  assets and  liabilities  of Four  Queens  have been  presented  in the
December  31, 2002  balance  sheet as assets  held for sale.  In  addition,  the
results of  operations of Four Queens for the three and nine month periods ended
September  30, 2003 and 2002 have been  presented  as  discontinued  operations.
Discontinued  operations were also presented to include a subsequent  adjustment
of $104,000 to the  write-down  of the  investment  in the capital stock of Four
Queens relating to the results of operations  during the quarter ended September
30, 2003.                                                                       

6.   Preferred Stock                                                            

     On September 29, 1998, as part of a recapitalization, the Company issued to
certain investment accounts managed by Morgens, Waterfall,  Vintiadis & Company,
Inc. ("the MWV Accounts")  50,000,000  shares of Preferred Stock in exchange for
the surrender to the Company of $18,000,000 original principal amount of certain
second  mortgage notes held by the MWV Accounts.  The holders of Preferred Stock
have (i) the right to receive  cumulative  dividends at the rate of 6% per year;
(ii) the  right to receive  the amount of $.36 per  share,  plus all  accrued or
declared  but unpaid  dividends on any shares then held,  upon any  liquidation,
dissolution or winding-up of the Company for an aggregate liquidation preference
of  $18,000,000;  (iii) voting  rights  equal to the  number of shares of Common
Stock into which the shares of Preferred  Stock may be  converted,  and (iv) the
right to convert the shares of Preferred Stock into 92,999,225  shares of Common
Stock.                                                                          

     Elsinore used a portion of the proceeds from the sale of Four Queens to pay
all accrued and unpaid  dividends on its Preferred  Stock through July 31, 2003.
At August 1, 2003,  immediately  before the  payments  were made,  Elsinore  had
outstanding  50,000,000  shares of  Preferred  Stock,  with  accrued  and unpaid
dividends of $5,860,815.                                                        

7.   Long-term Debt                                                             

     The sale of Four Queens was  consummated on July 31, 2003.  Elsinore used a
portion of the proceeds  from the sale to pay off the Notes.  At August 1, 2003,
immediately before the payments were made,  Elsinore had $5,380,489 in principal
amount and accrued but unpaid interest outstanding on the Notes.                

10-Q 13th Page of 36 TOC 1st Previous Next ↓Bottom Just 13th
Item 2:   Management's Discussion and Analysis of Financial Condition and       
Results of Operations                                       

     This  discussion  and  analysis  should  be read in  conjunction  with  the
Condensed Consolidated Financial Statements of Elsinore Corporation  ("Elsinore"
or the "Company") and notes thereto set forth elsewhere herein.                 

FORWARD-LOOKING STATEMENTS                                                      

     The  Private  Securities  Litigation  Reform  Act of 1995  provides a "safe
harbor" for certain  forward-looking  statements.  Certain information  included
herein and in other materials filed with the Securities and Exchange  Commission
("SEC") (as well as  information  included in oral  statements  or other written
statements  made or to be made by the  Company)  contains  statements  that  are
forward looking,  such as statements relating to the anticipated  dissolution of
Elsinore,  the establishment of a hold-back for the anticipated costs of wind-up
of Elsinore's  affairs,  the expectation that Elsinore will have funds remaining
to distribute to its  stockholders  from the proceeds of the sale of the capital
stock of Four  Queens,  Inc.  ("Four  Queens") and the  Company's  expectations,
beliefs and future plans now that it has sold Four Queens.  These statements may
also include  information  about the  Company's  adoption of certain  accounting
standards  and  their  anticipated  effects  on  business,  financing,  revenue,
operations,  regulations,  management's belief regarding the sufficiency of cash
flow and  compliance  with  applicable  laws.  Such  forward-looking  statements
involve  important  known and unknown risks and  uncertainties  that could cause
actual  results and  liquidity  to differ  materially  from those  expressed  or
anticipated  in any  forward-looking  statements.  Such risks and  uncertainties
include, but are not limited to, general economic conditions;  expenses incurred
in connection with the transaction;  liabilities and indemnification obligations
which may be incurred by the  Company;  the amount of funds that  Elsinore  must
hold-back  for  liabilities  in  anticipation  of the  wind-up of its  business;
actions  taken  or  omitted  to be taken by third  parties;  and  other  factors
described  from  time to time in the  Company's  reports  filed  with  the  SEC.
Accordingly,  actual results may differ  materially  from those expressed in any
forward-looking   statement   made  by  or  on  behalf  of  the   Company.   Any
forward-looking   statements  are  made  pursuant  to  the  Private   Securities
Litigation Reform Act of 1995, and, as such, speak only as of the date made. The
Company  undertakes  no  obligation  to revise  publicly  these  forward-looking
statements to reflect subsequent events or circumstances.                       

     The  following  tables  sets  forth  certain  continuing  and  discontinued
operating  information  for the  Company  for the  three and nine  months  ended
September 30, 2003 and 2002. Revenues and promotional  allowances are shown as a
percentage  of net  revenues.  Departmental  costs are shown as a percentage  of
departmental revenues. All other percentages are based on net revenues.         

     Beginning  August 1, 2003,  the results of  operations  of Four Queens have
been excluded from the Company's financial  statements.  The period(s) presented
in the current year are not comparable to the same period(s) in the prior year. 

10-Q 14th Page of 36 TOC 1st Previous Next ↓Bottom Just 14th
                                                        [Enlarge/Download Table]


                                       Three Months Ended                          Nine Months Ended            
                                       September 30, 2003                          September 30, 2002           
                            -----------------------------------------    ---------------------------------------
                             Sept. 30, 2003         Sept. 30, 2002          Sept. 30, 2003        Sept. 30, 2002
                            -----------------      ------------------    --------------------     --------------
                                                          (dollars in thousands)                                
Corporate Operations:                                                                                           
Revenues, net:                                                                                                  
                                                                                                                
   Other                                 $15                    $113                     $15               $454 
                            -----------------      ------------------    --------------------     --------------
     Net revenues                         15                     113                      15                454 
                            -----------------      ------------------    --------------------     --------------

Costs and expenses:                                                                                             
   Selling, general and                                                                                         
     administrative                    1,061                      98                   1,416                423 
   Interest                               44                     228                     376                684 
   Merger and litigation                                                                                        
     costs, net                            -                      14                       -              1,003 
                            -----------------      ------------------    --------------------     --------------
     Total costs and                                                                                            
     expenses                          1,105                     340                   1,792              2,110 
                            -----------------      ------------------    --------------------     --------------
   Net loss from                                                                                                
     continuing operations           (1,090)                   (227)                 (1,777)            (1,656) 
                            -----------------      ------------------    --------------------     --------------

Discontinued Operations:                                                                                        
Revenues, net:                                                                                                  
   Casino                              3,475                  10,128                  23,969             29,801 
   Hotel                                 652                   1,935                   5,001              6,189 
   Food and beverage                     930                   2,633                   6,812              8,349 
   Other                                 119                     320                     945                972 
                            -----------------      ------------------    --------------------     --------------
     Total revenue                     5,176                  15,016                  36,727             45,311 
   Promotional allowances              (568)                 (1,994)                 (3,825)            (5,505) 
                            -----------------      ------------------    --------------------     --------------
     Net revenues                      4,608                  13,022                  32,902             39,806 
                            -----------------      ------------------    --------------------     --------------

Costs and expenses:                                                                                             
   Casino                              1,183                   3,648                   8,102             10,212 
   Hotel                                 885                   2,456                   5,820              7,072 
   Food and beverage                     771                   1,752                   4,601              5,572 
   Taxes and licenses                    478                   1,515                   3,577              4,445 
   Selling, general and                                                                                         
     administrative                      760                   1,732                   4,891              5,580 
   Rents                                 366                   1,022                   2,552              3,236 
   Depreciation and                                                                                             
     amortization                          1  (1)                678                   1,039                678 
   Impairment                          (104)                       -                   4,906                324 
   Interest                               19                      70                     145                235 
                            -----------------      ------------------    --------------------      -------------
     Total costs and                                                                                            
     expenses                          4,359                  12,873                  35,633             37,354 
                            -----------------      ------------------    --------------------      -------------

10-Q 15th Page of 36 TOC 1st Previous Next ↓Bottom Just 15th
                                                        [Enlarge/Download Table]

                                                      Three Months Ended                          Nine Months Ended            
                                                      September 30, 2003                          September 30, 2002           
                                           -----------------------------------------    ---------------------------------------
                                            Sept. 30, 2003         Sept. 30, 2002          Sept. 30, 2003        Sept. 30, 2002
                                           -----------------      ------------------    --------------------     --------------
                                                                         (dollars in thousands)                                
  Income (loss) from                                                                                                           
    discontinued                                                                                                               
                                                                                                                               
    operations                                          249                     149                 (2,731)              2,452 
                                           -----------------      ------------------     -------------------      -------------

  Undeclared dividends on                                                                                                      
    cumulative convertible                                                                                                     
    preferred stock                                                                                                            
                                                        180                     322                     862                965 
                                           -----------------      ------------------     -------------------      -------------
   Net loss                                                                                                                    
   applicable to common                                                                                                        
   shares                                          ($1,021)                  ($400)                ($5,370)             ($169) 
                                           =================      ==================     ===================      =============

(1) In connection  with the Stock  Purchase  Agreement and Standard of Financial                                               
Accounting  Standards ("SFAS") No. 144, the Company ceased  depreciation of Four                                               
Queens' assets on April 29, 2003.                                                                                              

10-Q 16th Page of 36 TOC 1st Previous Next ↓Bottom Just 16th
THREE MONTHS ENDED SEPTEMBER 30, 2003 COMPARED
TO THREE MONTHS ENDED SEPTEMBER 30, 2002

RECENT DEVELOPMENTS                                                             

     On July 31, 2003,  Elsinore  completed the sale of all of the capital stock
of its wholly-owned  subsidiary,  Four Queens, to TLC Casino  Enterprises,  Inc.
("TLC") for $20.5 million.  Four Queens was Elsinore's  sole operating asset and
the capital stock of Four Queens was substantially all of Elsinore's assets.    

     Elsinore is preparing to wind up and  dissolve.  Elsinore used a portion of
the proceeds from the sale to pay off the outstanding 12.83% Mortgage Notes (the
"Notes"),  and to pay all accrued and unpaid  dividends on  Elsinore's  Series A
Preferred  Stock  ("Preferred  Stock") through July 31, 2003. At August 1, 2003,
immediately before the payments were made,  Elsinore had $5,380,489 in principal
amount  and  accrued  but  unpaid  interest  outstanding  on the  Notes  and had
outstanding  50,000,000 shares of Preferred Stock, with accumulated  accrued and
unpaid  dividends  of  $5,860,815.  After the  dissolution  process  begins  and
Elsinore  establishes an adequate hold-back for the anticipated costs of winding
up Elsinore's  affairs,  a portion of the remaining funds is expected to be paid
to the  holders  of  Elsinore's  common  stock  ("Common  Stock")  as a one-time
distribution,  and all other  distributions will be made to holders of Preferred
Stock.                                                                          

     The board of directors has approved a plan of liquidation and  dissolution.
As a result, the Company's financial statements as of September 30, 2003 and for
the period then ended have been prepared on the liquidation basis of accounting.
There was no  adjustment  necessary  to present the net assets of the Company at
liquidation  value. Also, the results of operations of Four Queens for the three
month  periods  ended  September  30,  2003  and 2002  have  been  presented  as
"discontinued  operations."  Beginning August 1, 2003, the results of operations
of Four Queens have been excluded from the Company's financial  statements.  The
period(s) presented in the current year are not comparable to the same period(s)
in the prior year.                                                              

CORPORATE OPERATIONS                                                            

OTHER NON-OPERATING REVENUES                                                    

     Other non-operating  revenues decreased by approximately $98,000, or 86.7%,
from  $113,000  during the 2002 period to $15,000  during the 2003 period.  This
decrease was primarily  due to payments  received  during 2002 of  approximately
$113,000  under a settlement  agreement  between the Company  through its wholly
owned subsidiary,  Olympia Gaming Corporation, and the Jamestown S'Klallam Tribe
and JKT Gaming, Inc.                                                            

COSTS AND EXPENSES                                                              

     Selling, general and administrative expenses increased $963,000, or 982.7%,
from $98,000  during the 2002 period to $1,061,000  during the 2003 period.  The
increase in expense was primarily due to increased corporate expenses, severance
expense and general legal fees associated with the sale of Four Queens.         

     Interest  expense  decreased  by  approximately  $184,000,  or  80.7%  from
$228,000 during the 2002 period to $44,000 for the 2003 period. The reduction in

10-Q 17th Page of 36 TOC 1st Previous Next ↓Bottom Just 17th
interest  expense was primarily  due to a reduction in the principal  balance of
the Notes as a result of a principal  payment by the Company in January 2003 and
repayment of the remaining balance due on the Notes on August 1, 2003.          

     During  the  quarter  ended  September  30,  2002,  the  Company   incurred
approximately  $14,000,  net,  in  merger  and  litigation  costs as a result of
litigation and settlement costs related to its Agreement and Plan of Merger with
Allen E. Paulson.  A Settlement  Bar Order and Final Judgment was entered by the
court on July 1, 2002. Pursuant to the settlement  agreement,  Elsinore paid the
sum of $1,100,000 on June 1, 2002.                                              

LOSS FROM CONTINUING OPERATIONS                                                 

     As a result of the factors  discussed above, the Company  experienced a net
loss from  continuing  operations in the 2003 period of  $1,090,000  compared to
$227,000 in the 2002 period.                                                    

DISCONTINUED OPERATIONS                                                         

REVENUES                                                                        

     The sale of Four Queens was  consummated  on July 31, 2003. The Company had
no revenues from  operations  between August 1, 2003 and September 30, 2003. Net
revenues were  approximately  $4,608,000  during the period from July 1, 2003 to
August 1, 2003.                                                                 

COSTS AND EXPENSES                                                              

     Total costs and expenses decreased by approximately  $8,410,000,  or 65.3%,
from  $12,873,000  for the 2002 period to $4,359,000 for the period from July 1,
2003 to  August  1, 2003 due  primarily  to the sale of Four  Queens on July 31,
2003.                                                                           

     On March 14, 2002,  the Company  entered into a Purchase  Agreement for the
sale of  substantially  all of the assets of Four Queens to SummerGate,  Inc. In
connection  with the  Purchase  Agreement,  the  Company  recognized  a non-cash
impairment  loss of  approximately  $13.2 million  during 2001 and  subsequently
recorded an additional  impairment loss of  approximately  $324,000 in the first
quarter of 2002, due to the amendment of the Purchase  Agreement and an increase
in the carrying  value of Four Queens'  assets that were to be sold at September
30, 2002.                                                                       

     On June 27, 2002, Four Queens  terminated the Purchase  Agreement and began
depreciating the fixed assets on July 1, 2002.                                  

     On April 29,  2003,  the  Company  announced  that it entered  into a Stock
Purchase  Agreement for the sale of all the capital stock of Four Queens and its
interest  in the  Fremont  Street  Experience,  LLC, to TLC for a price of $20.5
million.                                                                        

     In connection with the Stock Purchase Agreement,  the Company recognized an
adjustment to non-cash  impairment loss of approximately  ($104,000)  during the
third quarter of 2003. The  adjustment to the  impairment  loss was necessary in
order to adjust the Company's investment in Four Queens to the purchase price of
$20.5  million.  The sale of Four Queens was  consummated  on July 31, 2003. See
Note 1 and Note 5 to the Condensed Consolidated Financial Statements.           

10-Q 18th Page of 36 TOC 1st Previous Next ↓Bottom Just 18th
NET INCOME FROM DISCONTINUED OPERATIONS                                         

     As a result of the factors  discussed  above,  the Company  experienced net
income from discontinued operations in the period from July 1, 2003 to August 1,
2003 of $249,000 compared to $149,000 in the quarter ended September 30, 2002.  

 NINE MONTHS ENDED SEPTEMBER 30, 2003 COMPARED
 TO NINE MONTHS ENDED SEPTEMBER 30, 2002
--------------------------------------------------------------------------------

     The results of  operations  of Four Queens for the nine month periods ended
September 30, 2003 and 2002 have been  presented as  "discontinued  operations."
Beginning  August 1, 2003,  the results of  operations  of Four Queens have been
excluded from the Company's financial statements. The period(s) presented in the
current year are not comparable to the same period(s) in the prior year.        

CORPORATE OPERATIONS                                                            

OTHER NON-OPERATING REVENUES                                                    

     Other non-operating revenues decreased by approximately $439,000, or 96.7%,
from $454,000  during the nine months ended September 30, 2002 to $15,000 during
the period from January 1, 2003 to August 1, 2003.  This  decrease was primarily
due to payments  received  during the nine months  ended  September  30, 2002 of
approximately  $450,000 under a settlement agreement between the Company through
its wholly owned  subsidiary,  Olympia  Gaming  Corporation,  and the  Jamestown
S'Klallam Tribe and JKT Gaming, Inc.                                            

COSTS AND EXPENSES                                                              

     Selling, general and administrative expenses increased $993,000, or 234.8%,
from  $423,000  during the nine months ended  September  30, 2002 to  $1,416,000
during  the period  from  January 1, 2003 to August 1,  2003.  The  increase  in
expenses was primarily due to increased  corporate  expenses,  severance expense
and legal fees associated with the sale of Four Queens.                         

     Interest  expense  decreased  by  approximately  $308,000,  or  45.0%  from
$684,000  during the 2002 period to $376,000 for the 2003 period.  The reduction
in interest expense was primarily due to a reduction in the principal balance of
the Notes as a result of a principal  payment by the Company in January 2003 and
repayment of the remaining balance due on the Notes on August 1, 2003.          

     During the nine months  ended  September  30,  2002,  the Company  incurred
approximately  $1,003,000,  net, in merger and  litigation  costs as a result of
litigation and settlement costs related to its Agreement and Plan of Merger with
Allen E. Paulson.                                                               

LOSS FROM CONTINUING OPERATIONS                                                 

     As a result of the factors  discussed above, the Company  experienced a net
loss from continuing  operations in the period from January 1, 2003 to August 1,
2003 of $1,777,000 compared to $1,656,000 in the nine months ended September 30,
2002.                                                                           

10-Q 19th Page of 36 TOC 1st Previous Next ↓Bottom Just 19th
DISCONTINUED OPERATIONS                                                         

REVENUES                                                                        

     The sale of Four Queens was  consummated  on July 31, 2003. The Company had
no revenues from  operations  between August 1, 2003 and September 30, 2003. Net
revenues  decreased by  approximately  $6,904,000,  or 17.3%,  from  $39,806,000
during the nine months ended  September 30, 2002, to $32,902,000  for the period
from January 1, 2003 to August 1, 2003. This decrease was due, in large part, to
the sale of Four Queens on July 31, 2003.                                       

COSTS AND EXPENSES                                                              

     Total costs and expenses  decreased by approximately  $1,721,000,  or 4.6%,
from $37,354,000 for the nine months ended September 30, 2002 to $35,633,000 for
the period from  January 1, 2003 to August 1, 2003 due  primarily to the sale of
Four Queens on July 31, 2003.                                                   

     On March 14, 2002,  the Company  entered into a Purchase  Agreement for the
sale of  substantially  all of the assets of Four Queens to SummerGate,  Inc. In
connection  with the  Purchase  Agreement,  the  Company  recognized  a non-cash
impairment  loss of  approximately  $13.2 million  during 2001 and  subsequently
recorded an additional  impairment loss of  approximately  $324,000 in the first
quarter of 2002 due to the  amendment of the Purchase  Agreement and an increase
in the  carrying  value of Four  Queens'  assets  that were to be  purchased  at
September 30, 2002.                                                             

     On June 27, 2002, Four Queens  terminated the Purchase  Agreement and began
depreciating the fixed assets on July 1, 2002.                                  

     On April 29,  2003,  the  Company  announced  that it entered  into a Stock
Purchase  Agreement for the sale of all the capital stock of Four Queens and its
interest in the Fremont Street  Experience,  LLC, to TLC for a purchase price of
$20.5 million.                                                                  

     In connection with the Stock Purchase  Agreement,  the Company recognized a
non-cash  impairment  loss of  approximately  $5  million  during the first nine
months  of 2003.  The  impairment  loss was  necessary  in order to  adjust  the
Company's  investment in Four Queens to the purchase price of $20.5 million. The
sale of Four Queens was consummated on July 31, 2003. For more information,  see
Note 1 and Note 5 to the Condensed Consolidated Financial Statements.           

NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS                                  

     As a result of the factors  discussed above, the Company  experienced a net
loss from  discontinued  operations in the period from January 1, 2003 to August
1, 2003 of  $2,731,000  compared to net income from  discontinued  operations of
2,452,000 in the nine months ended September 30, 2002.                          

LIQUIDITY AND CAPITAL RESOURCES                                                 

     On July 31, 2003,  Elsinore  completed the sale of all of the capital stock
of Four  Queens  to TLC for $20.5  million.  Four  Queens  was  Elsinore's  sole
operating  asset and the capital stock of Four Queens was  substantially  all of
Elsinore's assets.                                                              

10-Q 20th Page of 36 TOC 1st Previous Next ↓Bottom Just 20th
     Elsinore  used a  portion  of the  proceeds  from  the  sale to pay off the
outstanding  Notes, and to pay all accrued and unpaid dividends on the Preferred
Stock through July 31, 2003. At August 1, 2003,  immediately before the payments
were made,  Elsinore had $5,380,489 in principal  amount,  including accrued and
unpaid interest, of the Notes outstanding and had outstanding  50,000,000 shares
of Preferred Stock, with accumulated accrued and unpaid dividends of $5,860,815.

     Elsinore  is  preparing  to wind up and  dissolve.  After  establishing  an
adequate hold-back for the anticipated costs of winding up Elsinore's affairs, a
portion of the  remaining  funds is expected to be paid to the holders of Common
Stock as a one-time  distribution,  and all other  distributions will be made to
holders of Preferred Stock.                                                     

     As a result  of the sale of Four  Queens,  beginning  August 1,  2003,  the
Company had no revenues from operations.                                        

     At September 30, 2003, after consummation of the sale, the Company had cash
and cash equivalents of approximately $9.2 million, as compared to approximately
$1.8 million at December 31, 2002.                                              

     During  the first  nine  months  of 2003,  the  Company's  net cash used in
operating activities was $1.8 million compared to $1.6 million in the first nine
months of 2002. As a result of  consummation  of the sale of Four Queens on July
31, 2003, the Company no longer has an operating asset.                         

     Certain  investment  accounts  managed by Morgens,  Waterfall,  Vintiadis &
Company,  Inc. (the "MWV Accounts") own 93% of the outstanding  Common Stock and
all of the 50,000,000  outstanding shares of Preferred Stock. Based on SEC rules
concerning beneficial ownership of stock and the convertibility of the Preferred
Stock into Common Stock, the MWV Accounts are deemed to own beneficially, in the
aggregate,  99.6% of the Common Stock. Elsinore's stock held by the MWV Accounts
is deemed  beneficially  owned by John C. "Bruce"  Waterfall,  Elsinore's former
Chairman of the Board. The remaining .4% of the Common Stock is widely dispersed
among numerous shareholders.  Mr. Waterfall is the only individual who exercises
voting and investment  authority over  Elsinore's  stock on behalf of any of the
MWV Accounts.                                                                   

     Based upon its  cessation  of  operations  on July 31,  2003,  the  Company
believes that it has sufficient operating capital to fund its limited operations
for the next twelve months or until completion of the wind-up and liquidation of
the Company.                                                                    

RECENTLY ISSUED ACCOUNTING STANDARDS                                            

     In May 2003, the Financial  Accounting Standards Board issued SFAS No. 150,
"Accounting  for Certain  Financial  Instruments  with  Characteristics  of both
Liabilities  and Equity." SFAS No. 150  establishes  standards for how an issuer
classifies and measures certain financial  instruments with  characteristics  of
both  liabilities  and equity.  It requires that an issuer  classify a financial
instrument  that is  within  its  scope  as a  liability  (or an  asset  in some
circumstances). SFAS No. 150 is effective for financial instruments entered into
or modified  after May 31, 2003,  and otherwise is effective at the beginning of
the first interim period beginning after June 15, 2003. The Company adopted SFAS
No. 150 on July 1, 2003, and the adoption did not have a material  impact on its
financial position and results of operations.                                   

10-Q 21st Page of 36 TOC 1st Previous Next ↓Bottom Just 21st
CRITICAL ACCOUNTING POLICIES                                                    

     The preparation of the Company's consolidated financial statements requires
the Company's  management to adopt accounting policies and to make estimates and
assumptions  that affect the reported amounts of assets,  liabilities,  revenue,
expenses and provision for income taxes. Management periodically evaluates these
policies,  estimates and  assumptions.  While it owned Four Queens,  the Company
operated in a highly  regulated  industry  and was subject to  regulations  that
described and regulated operating and internal control procedures.  The majority
of casino revenue was in the form of cash,  personal  checks or gaming chips and
tokens,  which by their nature do not require complex  estimations.  We estimate
certain  liabilities  with  payment  periods that extend for longer than several
months.  We believe  that these  estimates  are  reasonable  based upon our past
experience with the business and based upon our assumptions  related to possible
outcomes in the future.  Future  actual  results  will likely  differ from these
estimates.                                                                      

Deferred Income Tax Assets                                                      

     We utilize  estimates  related to cash flow projections for the application
of SFAS No. 109 to the  realization  of deferred tax assets.  Our  estimates are
based upon recent operating  results and budgets for future  operating  results.
These  estimates  are made  using  assumptions  about the  economic,  social and
regulatory environments in which we operate. These estimates could be negatively
impacted  by  numerous   unforeseen  events  including  changes  to  regulations
affecting how we operate our  business,  changes in the labor market or economic
downturns in the areas where we operate.                                        

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Item 3.  Quantitative and Qualitative Disclosures About Market Risks            

     Market  risk is the risk of loss  arising  from  adverse  changes in market
rates and prices,  such as interest rates,  foreign currency  exchange rates and
commodity prices. The Company's primary financial  instrument is cash. It is the
Company's policy not to enter into derivative financial instruments. The Company
does not currently have any significant  foreign currency exposure since it does
not transact business in foreign  currencies.  Due to the extinguishment of debt
in  connection  with  the  sale  of Four  Queens,  the  Company  does  not  have
significant overall market risk exposure at September 30, 2003.                 

Item 4.  Controls and Procedures                                                

     As of the end of the period  covered  by this  report,  we  carried  out an
evaluation,  under the supervision and with the  participation  of our President
and our principal  financial  officer,  of the  effectiveness  of the design and
operation of our disclosure  controls and procedures.  Based on this evaluation,
our President and principal  financial  officer  concluded  that our  disclosure
controls  and  procedures  are  effective  in timely  alerting  them to material
information required to be included in our periodic SEC filings.                

     There has been no change in our internal  control over financial  reporting
that occurred during our most recent fiscal quarter that has materially affected
or is reasonably likely to materially affect our internal control over financial
reporting.                                                                      

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 Elsinore Corporation and Subsidiaries
 Other Information

PART II.  OTHER INFORMATION                                                     

Item 4.   Submission of Matters to a Vote of Security Holders                   

          By written  consent  dated  August 1, 2003,  shareholders  approved an
          amendment of the  Company's  articles of  incorporation  to reduce the
          minimum  number  of  authorized   directors  from  four  to  one.  The
          shareholders  who  voted  on the  amendment  were the  holders  of the
          50,000,000   outstanding   shares  of  Preferred   Stock,   which  are
          convertible into 93,999,225 shares of Common Stock and are voted on an
          as-converted  basis.  All  holders of  Preferred  Stock  voted for the
amendment.                                                  

          By written  consent  dated May 30,  2003,  shareholders  approved  the
          Company's sale of capital stock of Four Queens, as described elsewhere
          in this  report.  The  shareholders  who  voted on the  sale  were the
          holders of all of the  outstanding  shares of Preferred  Stock,  which
          were voted in the manner  described  above.  All holders of  Preferred
Stock voted for the sale.                                   

Item 6.   Exhibits and Reports on Form 8-K                                      

(a)  Exhibits                                                         

2      Plan of Liquidation and Dissolution                  

3      Articles of Incorporation (1)                        

          31.1   Certification  of  the  Principal   Executive  Officer  of  the
Registrant pursuant to Exchange Act Rule 13a-14(a).         

          31.2   Certification  of  the  Principal   Financial  Officer  of  the
Registrant pursuant to Exchange Act Rule 13a-14(a).         

          32.1   Certification  of  the  Principal   Executive  Officer  of  the
          Registrant pursuant to 18 U.S.C.  section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.              

          32.2   Certification  of  the  Principal   Financial  Officer  of  the
          Registrant pursuant to 18 U.S.C.  section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.              

          (1) In  addition to the amended  articles  of  incorporation  included
          herein,  the  Certificate of  Designations,  Preferences and Rights of
          Elsinore  Corporation Series A Preferred Stock is incorporated  herein
          by reference to Exhibit 3.3 of the Company's  report on Form 8-K filed
on October 13, 1998.                                        

(b)  Forms 8-K filed during this quarter                              

          (1) Current  report on Form 8-K (Item 2) was filed on August 13, 2003,
          announcing the sale of the capital stock of Four Queens.  An unaudited
          pro forma consolidated  balance sheet as of March 31, 2003, giving pro
       forma effect to the capital stock sale, was included in the filing.

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SIGNATURES

     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended,  the  Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.                                   

                    ELSINORE CORPORATION
                    --------------------
                      (Registrant)

                By: /s/ Joann McNiff
                    ----------------
                           JOANN MCNIFF, President

                        By: /s/ Gina L. Mastromarino
                            ------------------------
                                   GINA L. MASTROMARINO, Principal
                                  Financial & Accounting Officer

Dated:  November 6, 2003                                                        

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 EXHIBIT 2

 AMENDED AND RESTATED PLAN OF COMPLETE
LIQUIDATION AND DISSOLUTION OF ELSINORE CORPORATION 

          This Amended and Restated Plan of Complete Liquidation and Dissolution
     (this  "Plan") is intended  to  accomplish  the  complete  liquidation  and
     dissolution of Elsinore Corporation,  a Nevada corporation (the "Company"),
     in accordance with Chapter 78 of the Nevada Revised Statutes ("Chapter 78")
     and Sections 331 and 336 of the Internal  Revenue Code of 1986, as amended,
as follows:                                                           

          1. The Board of Directors  of the Company  (the "Board of  Directors")
     has adopted this Plan and is recommending  that the Company's  stockholders
     approve this Plan.  If holders of a majority of the  Company's  outstanding
     stock entitled to vote on this matter vote to approve this Plan,  this Plan
     shall be deemed  adopted by the Company as of the date of such  approval by
the stockholders (the "Adoption Date").                               

          2.  Following  the date  that the  Company  files its  certificate  of
     dissolution with the Secretary of State of the State of Nevada (the "Filing
     Date"),  the Company will not engage in any business  activities  except to
     the extent  necessary or  appropriate  to preserve the value of its assets,
     wind up its business affairs, distribute its assets in accordance with this
     Plan and take such other actions permitted or required under Chapter 78 for
dissolved corporations.                                               

          3. From and after the Filing Date,  (i) the Company will liquidate and
     distribute  its  remaining  assets in  accordance  with the  provisions  of
     Chapter 78 and the Distribution  Consent (as defined in Section 4), if any,
     and (ii) the Board of Directors  may, at its option,  instruct the officers
     of the Company to: (A) give notice of the  dissolution  to persons having a
     claim against the Company and provide for the rejection of any such claims,
     if  appropriate;  (B) offer to any  claimant  on a contract  whose claim is
     contingent,  conditional or unmatured,  security in an amount sufficient to
     provide  compensation to the claimant if the claim matures, and petition an
     appropriate court of the State of Nevada having  jurisdiction  ("Court") to
     determine   the  amount  and  form  of  security   sufficient   to  provide
     compensation  to any such  claimant who rejects such offer;  (C) petition a
     Court to  determine  the amount and form of  security  which is  reasonably
     likely to be sufficient to provide compensation for any claims that are the
     subject of pending  litigation against the Company and any claims that have
     not been  made  known to the  Company  at the time of  dissolution  but are
     likely to arise or become known within three years thereafter (or longer in
     the  discretion  of the Court);  (D) pay,  or make  adequate  provision for
     payment of, all claims made against the Company and not  rejected,  and all
     expenses   associated  with  the  sale  of  assets  and  the   liquidation,
     dissolution and  distributions  provided for by this Plan; and (E) post all
security offered and not rejected and all security ordered by a Court.

          4. If and to the extent  that the  holders of the  Company's  Series A
     Preferred Stock,  $0.001 par value per share ("Preferred  Stock"),  execute
     and deliver in a timely manner to the Board of Directors a written  consent
     that  is   satisfactory   in  all   respects  to  the  Board  of  Directors
     ("Distribution  Consent"),   authorizing  and  requesting  the  Company  to
     distribute to holders of the Company's  common stock,  par value $0.001 per
     share  ("Common  Stock"),  cash or other  assets of the Company  that would
     otherwise be  distributable  to holders of Preferred  Stock pursuant to the
     dissolution,  then the  Company  shall make such  distribution  (a "Special
     Distribution")  to the  holders of Common  Stock.  Except to the extent (if
     any) of a Special Distribution, distributions to holders of Preferred Stock
     and Common Stock,  respectively,  pursuant to the dissolution shall be made
     as provided in the Certificate of  Designations,  Preferences and Rights of
     Elsinore Corporation Series A Preferred Stock, dated September 29, 1998 (as
may hereafter be amended).                                            

          5. The  distributions to stockholders  pursuant to the dissolution and
     this Plan shall be in complete  redemption and  cancellation  of all of the
     Company's  stock. As a condition to any such  distribution to the Company's
     stockholders, the Board of Directors or the Trustees (as defined below), in
     their absolute discretion,  may require stockholders to (i) surrender their
     stock  certificates  to  the  Company  or  its  agent  for  recording  such
     distributions   thereon  or   (ii) furnish   the  Company   with   evidence
     satisfactory  to the Board of Directors  or the Trustees for such  purpose.
     The Company will finally  close its stock  transfer  books and  discontinue
     recording  transfers of stock as soon as practicable after the Filing Date,
     and thereafter certificates evidencing Company stock will not be assignable
     or  transferable  on the books of the  Company  except  by will,  intestate
succession or operation of law.                                       

          6.  Except  for  any  Special  Distribution,  if a  distribution  to a
     stockholder  cannot be made,  whether  because  the  stockholder  cannot be
     located,  has not  surrendered  its stock  certificate  as may be  required
     hereunder  or  for  any  other  reason,  the  distribution  to  which  such
     stockholder  is  entitled  (unless  transferred  to the  Trust  established
     pursuant  to Section 7 hereof)  shall be  transferred,  at such time as the
     final liquidating  distribution is made by the Company,  to the official of
     such state or other  jurisdiction  authorized by applicable  law to receive
     the proceeds of such distribution.  The proceeds of such distribution shall
     thereafter be held solely for the benefit of, and for ultimate distribution
     to, such  stockholder as the sole equitable owner thereof but shall, to the
     extent  provided by  applicable  law, be treated as abandoned  property and
     escheat  to the  applicable  state or other  jurisdiction.  If any  Special
     Distribution   to  a  holder  of  Common  Stock  cannot  be  made  and  the
     Distribution  Consent contains  provisions  deemed adequate by the Board of
     Directors, in its absolute discretion,  for the disposition or disbursement
     of the proceeds  thereof (which  provisions may direct a re-allocation  and
     distribution  of those  proceeds to the holders of Preferred  Stock),  then
     such  proceeds  shall be disposed of or  disbursed  (as the case may be) in
accordance with such provisions of the Distribution Consent.          

          7. If  deemed  necessary,  appropriate  or  desirable  by the Board of
     Directors in its absolute discretion, in furtherance of the liquidation and
     distribution  of the  Company's  assets  to the  stockholders,  as a  final
     liquidating  distribution or from time to time, the Company may transfer to
     one or  more  liquidating  trustees,  for  the  benefit  of  the  Company's
     stockholders (the "Trustees"), under a liquidating trust (the "Trust"), any
     assets  of  the  Company  which  are  (i)  not  reasonably  susceptible  to
     distribution to the stockholders,  including noncash assets and assets held
     on behalf of  stockholders  (A) who  cannot be located or who do not tender
     their stock  certificates to the Company or its agent,  if so required,  or
     (B) to whom  distributions may not be made based on contractual,  statutory
     or other legal  restrictions,  or (ii) held as a contingency  reserve.  The
     Board of  Directors  may  appoint  one or more  individuals,  corporations,
     partnerships or other persons,  or any combination  thereof,  including any
     officers,  directors,  employees,  agents or other  representatives  of the
     Company,  to act as  Trustees  for the benefit of the  stockholders  and to
     receive any assets of the Company.  Any  Trustees  appointed as provided in
     the preceding  sentence  shall succeed to all right,  title and interest of
     the  Company of any kind and  character  with  respect to such  transferred
     assets and, to the extent of the assets so transferred  and solely in their
     capacity as Trustees,  shall assume all of the  liabilities and obligations
     of the Company,  including  any  unsatisfied  claims and  unascertained  or
     contingent  liabilities.  Further, any conveyance of assets to the Trustees
     shall be deemed a distribution of property and assets by the Company to the
     stockholders  for the  purposes of this Plan.  Any such  conveyance  to the
     Trustees  shall  be in  trust  for the  stockholders  of the  Company.  The
     Company,  subject  to  this  Section  and as  authorized  by the  Board  of
     Directors,  in its absolute discretion,  may enter into a liquidating trust
     agreement  with the Trustees on such terms and  conditions  as the Board of
     Directors,  in its absolute  discretion,  deems  necessary,  appropriate or
desirable.                                                            

          8. After the Adoption Date, the officers of the Company shall, at such
     time as the Board of Directors in its absolute  discretion deems necessary,
     appropriate  or  desirable,  obtain  any  certificates  required  from  tax
     authorities to accomplish the dissolution.  As soon as legally  permissible
     and  practicable  after the Adoption  Date, the Company shall file with the
     Secretary of State of the State of Nevada a certificate  of  dissolution in
accordance with Chapter 78.                                           

          9.  Under  this  Plan the Board of  Directors  may  approve  the sale,
     exchange or other  disposition  in  liquidation  of all of the property and
     assets  of  the  Company,  including  any  such  sale,  exchange  or  other
     disposition in liquidation to affiliates of the Company,  whether the sale,
     exchange  or other  disposition  occurs in one  transaction  or a series of
transactions.                                                         

          10.  In  connection  with and for the  purposes  of  implementing  and
     assuring  completion  of  this  Plan,  the  Company  may,  in the  absolute
     discretion  of  the  Board  of  Directors,   pay  any  brokerage,   agency,
     professional,  legal, accounting, consulting and other fees and expenses of
     persons  rendering  services to or on behalf of the  Company in  connection
     with the implementation of this Plan and the collection,  sale, exchange or
other disposition of the Company's property and assets.               

          11.  In  connection  with  and for the  purpose  of  implementing  and
     assuring  completion  of  this  Plan,  the  Company  may,  in the  absolute
     discretion  of the  Board  of  Directors,  pay any or all of the  Company's
     officers,  directors,  employees,  consultants,  agents and representatives
     compensation or additional  compensation above their regular  compensation,
     in cash or other  property,  as  severance,  bonus or in any other form, in
     recognition  of  the  extraordinary   efforts  they  will  be  required  to
     undertake,  or actually undertake, in connection with the implementation of
this Plan.                                                            

          12. The Company shall  continue to indemnify its officers,  directors,
     employees,  agents and  representatives  in accordance with its articles of
     incorporation and bylaws and any contractual arrangements,  for the actions
     taken in connection with this Plan and the winding up of the affairs of the
     Company.  The Company's  obligation  to indemnify  such persons may also be
     satisfied  out of  assets of the  Trust.  The  Board of  Directors  and the
     Trustees,  in their  absolute  discretion,  are  authorized  to obtain  and
     maintain  insurance  as  may be  necessary  or  appropriate  to  cover  the
     Company's obligation hereunder,  including seeking an extension in time and
coverage of the Company's insurance policies currently in effect.     

          13.  Notwithstanding  approval  of  this  Plan  and  the  transactions
     contemplated hereby by the Company's  stockholders,  the Board of Directors
     may modify,  amend or abandon this Plan and the  transactions  contemplated
     hereby without further action by the  stockholders to the extent  permitted
by Chapter 78.                                                        

          14. The Board of Directors is  authorized,  without  further action by
     the Company's stockholders,  to do and perform or cause the officers of the
     Company,  subject to approval of the Board of Directors, to do and perform,
     any and all  acts,  and to make,  execute,  deliver  or  adopt  any and all
     agreements, resolutions,  conveyances,  certificates and other documents of
     any kind which are  deemed  necessary,  appropriate  or  desirable,  in the
     absolute  discretion of the Board of Directors,  to implement this Plan and
     the transactions  contemplated hereby and to wind up the Company's affairs,
     including  all  filings or acts  required  by any state or  federal  law or
regulation.                                                           

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 EXHIBIT 3

 CERTIFICATE OF AMENDMENT OF
 ARTICLES OF INCORPORATION
OF
 ELSINORE CORPORATION,
a Nevada corporation

     I,  the  undersigned   President,   Secretary  and  Treasurer  of  Elsinore
Corporation, a Nevada corporation (the "Corporation"), certify that:            

     1. The Board of  Directors  of the  Corporation,  at a duly held meeting on
July 2,  2003,  adopted  a  resolution  to (i) amend the  Amended  and  Restated
Articles of Incorporation of the Corporation (the "Articles"),  originally filed
with the  Secretary  of State of the State of Nevada on March 4,  1997,  as such
amendment is set forth in paragraph 2 below (the "Amendment"),  and (ii) present
the Amendment to the stockholders of the Corporation for their approval pursuant
to Chapter 78 of the Nevada Revised Statutes.                                   

     2. The last sentence of Article V, Section 1 of the Articles is amended and
restated in its entirety to read as follows:                                    

          The number of directors  may be fixed and changed from time to time in
          such  manner as shall be  provided  in the bylaws of the  corporation;
          provided,  however, the number of directors shall be not less than one
(1).                                                        

     3. The number of shares of the Corporation outstanding and entitled to vote
on the  Amendment  consists  of (i)  4,993,965  shares of Common  Stock and (ii)
50,000,000  shares of Preferred Stock that in the aggregate are convertible into
92,999,225  shares of Common Stock and that vote on the Amendment  together with
the  Common  Stock  on an  as-converted  basis,  resulting  in an  aggregate  of
97,993,190  votes that  could be cast with  respect  to the  Amendment,  and the
Amendment  has been  approved by a vote of the  stockholders  holding at least a
majority of such stock outstanding and entitled to vote thereon.                

     IN WITNESS WHEREOF, the undersigned, as President,  Secretary and Treasurer
of the Corporation, has executed this Certificate as of September 15, 2003.     

                         /s/Joann McNiff
                         ---------------
                      Joann McNiff

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AMENDED AND RESTATED
 ARTICLES OF INCORPORATION
OF
ELSINORE CORPORATION

The undersigned hereby certifies under penalty of perjury as follows: 

     1. The United  States  Bankruptcy  Court for the  District  of Nevada  (the
"Court") in Case Nos.  95-24685 RCJ,  95-24686 RCJ,  95-24687 RCJ, 95-24688 RCJ,
95-24689  RCJ, and 95-24839  RCJ, has  confirmed a plan of  reorganization  (the
"Plan") for Elsinore  Corporation,  a Nevada  corporation  (the  "Corporation"),
pursuant to Chapter 11 of Title 11 of the United States Code.                   

     2. A certified  copy of the Plan is being filed with the Secretary of State
of the State of Nevada (the "Secretary") together with this Certificate.        

     3.  Pursuant to the Plan and this  filing of a  certified  copy of the Plan
with the Secretary,  the Corporation's Articles of Incorporation are amended and
restated to read as follows:                                                    

ARTICLE I:     NAME 

The name of the corporation shall be ELSINORE CORPORATION.            

ARTICLE II:     REGISTERED OFFICE 

     The name of the  resident  agent and the street  address of the  registered
     office  in the  State  of  Nevada  where  process  may be  served  upon the
     corporation is Cynthia A. Fremont,  202 Fremont Street,  Las Vegas,  Nevada
     89101.  The  corporation  may, from time to time, in the manner provided by
     law,  change the resident agent and the registered  office within the State
     of Nevada.  The  corporation may also maintain an office or offices for the
     conduct of its  business,  either  within or  without  the State of Nevada.
     Corporate business of every kind and nature may be conducted,  and meetings
     of directors and stockholders  held,  outside the State of Nevada, the same
as in the State of Nevada.                                            

ARTICLE III:     CORPORATE PURPOSES 

     The  nature  of  the  business  and  object  and  purposes  proposed  to be
     transacted,  promoted,  or carried on by the corporation are: (a) to engage
     in any lawful activity; and (b) to conduct gaming in the State of Nevada in
     accordance  with the laws of the State of Nevada and the  United  States of
America.                                                              

ARTICLE IV:     CAPITAL STOCK 

          Section 1. Authorized  Shares.  The corporation is authorized to issue
     two (2) classes of shares of stock. One class of shares shall be designated
     "Common Stock," with $0.001 par value per share. The total number of shares
     of Common  Stock  which  this  Corporation  is  authorized  to issue is one
     hundred  million   (100,000,000).   Common  Stock  may  be  issued  by  the
     Corporation  from time to time by  resolution  of the  Board of  Directors,
     except as  otherwise  provided in this  Section.  The shares of  authorized
     Common Stock shall be identical in all respects and shall have equal rights

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     and  privileges  and shall be  entitled to one (1) vote each on all matters
submitted to a vote of the stockholders.                              

          The other class of shares which the corporation is authorized to issue
     shall be designated "Preferred Stock," with $0.001 par value per share. The
     total  number  of shares  of  Preferred  Stock  which  the  corporation  is
     authorized  to issue fifty  million  (50,000,000).  Preferred  Stock may be
     issued by the  corporation  from time to time by resolution of the Board of
     Directors  in one or more series with such  voting  powers,  distinguishing
     designations, preferences, limitations, restrictions and relative rights as
     the Board of  Directors  determines  by  resolution,  except  as  otherwise
provided in this Section.                                             

          If the Board of Directors  determines by resolution that the Preferred
     Stock shall have a  preference  over any other  class of equity  securities
     with  respect  to  dividends,  such  resolution  shall  also make  adequate
     provisions for the election of directors  representing  the holders of such
   Preferred Stock in the event of default in the payment of such dividends.

The corporation shall not issue nonvoting equity securities.

          The corporation  shall not issue any stock or other securities  except
     in accordance  with the provisions of the Nevada Gaming Control Act and the
     regulations  thereunder.  The issuance of any stock or other  securities in
     violation  thereof shall be ineffective and such stock or other  securities
     shall be deemed not to be issued and outstanding  until (i) the corporation
     shall  cease  to be  subject  to  the  jurisdiction  of the  Nevada  Gaming
     Commission  ("Commission"),  or (ii) the Commission  shall,  by affirmative
action, validate said issuance or waive any defect in issuance.       

          No  stock  or  other  securities  issued  by  the  corporation  and no
     interest,  claim or charge  therein or thereto shall be  transferred in any
     manner  whatsoever  except in accordance  with the provisions of the Nevada
     Gaming  Control  Act  and  the  regulations  thereunder.  Any  transfer  in
     violation  thereof shall be  ineffective  until (i) the  corporation  shall
     cease to be  subject to the  jurisdiction  of the  Commission,  or (ii) the
     Commission  shall, by affirmative  action,  validate said transfer or waive
any defect in said transfer.                                          

          If the  Commission  at any time  determines  that a holder of stock or
     other securities of this corporation is unsuitable to hold such securities,
     then until such  securities are owned by persons found by the Commission to
     be  suitable  to own them,  (a) the  corporation  shall not be  required or
     permitted  to pay any dividend or interest  with regard to the  securities,
     (b) the  holder of such  securities  shall not be  entitled  to vote on any
     matter as the holder of the  securities and such  securities  shall not for
     any purposes be included in the securities of the  corporation  entitled to
     vote, and (c) the corporation shall not pay any remuneration in any form to
the holder of the securities.                                         

          Section 2.  Consideration for Shares.  The capital stock authorized by
     Section 1 of this Article shall be issued for such  consideration  as shall
be fixed, from time to time, by the Board of Directors.               

          Section 3. Assessment of Stock.  The capital stock of the corporation,
     after the amount of the  subscription  price has been fully paid in,  shall
     not be assessable for any purpose,  and no stock issued as fully paid shall
     ever be  assessable  or assessed.  No  stockholder  of the  corporation  is
individually liable for the debts or liabilities of the corporation.  

          Section  4.  Cumulative  Voting For  Directors.  At all  elections  of
     directors of the corporation,  each holder of stock possessing voting power
     is  entitled  to as many  votes as equal the number of his or her shares of
     stock  multiplied  by the number of directors to be elected,  and he or she
     may cast all of his or her votes for a single  director  or may  distribute
     them among the number to be voted for or any two or more of them,  as he or
she sees fit.                                                         

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          Section 5. Preemptive  Rights. No stockholder of the corporation shall
have any preemptive rights.                                           

 ARTICLE V:     DIRECTORS AND OFFICERS

          Section 1. Number of Directors.  The members of the governing board of
     the  corporation  are styled as  directors.  The number of directors may be
     fixed and changed  from time to time in such manner as shall be provided in
     the bylaws of the corporation;  provided,  however, the number of directors
shall be not less than three (3).                                     

          Section 2. Current  Directors.  The names and post office addresses of
  the current Board of Directors, which consists of five (5) members, are:

NAME                            ADDRESS                       
----                            -------                       
Edward M. Nigro                 4545 Spring Mountain Road     
      #105
                     Las Vegas, NV 89102

Jeffrey T. Leeds                200 Park Avenue               
            58th Floor
                     New York, NY  10166

John C. "Bruce" Waterfall       10 East 50th Street           
            26th Floor
                     New York, NY  10020

Harry C. Hagerty, III           Deutsche, Morgan, Grenfell    
                   31 W. 52nd Street
            25th Floor
                     New York, NY  10019

S. Barton Jacka                 14660 South Quiet Meadow Drive
                 Reno, NV  89511

     Vacancies  on the Board of  Directors  shall be filled,  and  elections  of
directors shall be held, in accordance with the Bylaws.               

          Section 3. Limitation of Personal Liability. No director or officer of
     the corporation  shall be liable to the corporation or its stockholders for
     damages  for  breach of  fiduciary  duty as a  director  or  officer.  This
     provision  shall not  eliminate  or limit the  liability  of a director  or
     officer for acts or omissions which involve intentional misconduct,  fraud,
     a knowing violation of law, or the payment of distributions in violation of
     Nevada Revised Statutes section 78.300.  If the Nevada Revised Statutes are
     hereafter amended or interpreted to eliminate or limit further the personal
     liability of directors or officers, then the liability of all directors and
     officers  shall  be  eliminated  or  limited  to the  full  extent  then so
permitted.                                                            

          Section 4. Payment of Expenses.  All expenses  incurred by officers or
     directors in defending a civil or criminal action, suit, or proceeding must
     be paid by the  corporation  as they are  incurred  in  advance  of a final
     disposition  of  the  action,  suit  or  proceeding,  upon  receipt  of  an
     undertaking by or on behalf of a director or officer to repay the amount if
     it is ultimately  determined by a court of competent  jurisdiction that (i)

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     he or she did not act in good faith, and in the manner he or she reasonably
     believed to be in or not opposed to the best  interests of the  corporation
     or (ii) with respect to any criminal action or  proceedings,  he or she had
reasonable cause to believe his or her conduct was unlawful.          

          Section 5. Repeal and Conflicts. Any repeal or amendments of Section 3
     or 4 of this Article or the adoption of any provision of these  Articles of
     Incorporation  inconsistent  with Section 3 or 4 of this  Article  shall be
     prospective only and shall not eliminate or reduce the effect of Sections 3
     or 4 of this Article in respect of any act or omission that occurred  prior
     to such repeal,  amendment or adoption of an inconsistent provision. In the
     event of any conflict between Sections 3 or 4 of this Article and any other
     Article  of the  corporation's  Articles  of  Incorporation,  the terms and
     provisions  of Section 3 or 4 of this  Article,  as the case may be,  shall
control.                                                              

          Section 6. Compliance with Gaming Control Act. All of the directors of
     the  corporation  shall be subject to, and the  composition of the Board of
     Directors shall be in compliance with, the requirements and  qualifications
     imposed by the Nevada Gaming Control Act (Nevada Revised  Statutes  section
     463.010 et seq., as amended from time to time), or any successor  provision
     of Nevada law, and the regulations  promulgated  thereunder,  and the rules
     and regulations of any  governmental  agency  responsible for the licensing
     and regulation of gaming  operations,  including  without  limitation,  the
     Nevada State Gaming Control Board,  the Nevada State Gaming  Commission and
the Clark County Liquor and Gaming Licensing Board.                   

ARTICLE VI:     PERPETUAL EXISTENCE 

The corporation shall have perpetual existence.             

ARTICLE VII:     MISCELLANEOUS

          The  corporation  shall not be  governed by the  provisions  of Nevada
     Revised Statutes Sections 78.378 to 78.3793,  inclusive, or Sections 78.411
to 78.444, inclusive.                                                 

ARTICLE VIII:     AMENDMENT OF ARTICLES OF INCORPORATION

          Section 1.  General.  Except as provided in Section 2. of this ARTICLE
     VIII., these Articles of Incorporation may be amended, modified, altered or
     repealed only with the affirmative vote of the holders of a majority of the
     voting power of all the shares of stock of the corporation entitled to vote
    generally in the election of directors, voting together as a single class.

          Section 2. Amendment of Certain Provisions.  Notwithstanding  anything
     contained in these Articles of Incorporation to the contrary,  ARTICLE VII.
     hereof  shall  not  be  altered,  amended  or  repealed  and  no  provision
     inconsistent therewith shall be adopted without the affirmative vote of the
     holders of at least  eighty  percent  (80%) of the voting  power of all the
     shares  of stock  of the  corporation  entitled  to vote  generally  in the
     election of directors,  voting together as a single class.  Notwithstanding
     anything contained in these Articles of Incorporation to the contrary,  the
     affirmative  vote of the holders of at least  eighty  percent  (80%) of the
     voting power of all the shares of stock of the corporation entitled to vote
     generally in the election of directors,  voting together as a single class,
     shall be required to amend or adopt any provision  inconsistent with, or to
alter or repeal this Section 2 of ARTICLE VIII.                       

     4.  The  undersigned  has  been  authorized  by  the  Court  to  file  this
Certificate  with  the  Secretary  in  accordance  with  the  Court's  order  of
reorganization pursuant to the Plan.                                            

Executed this 27 day of Feb., 1997.                                             

                   /s/Jeffrey T. Leeds
                Jeffrey T. Leeds
STATE OF NY      )                                                              
)       ss.                                   
COUNTY OF NY     )                                                              

This instrument was acknowledged before me on  2-27,          
1997 by Jeffrey T. Leeds,  as  President  of Elsinore Corporation.              

                   /s/Joseph J. Nelson
             Notary Public
                Joseph H. Nelson
                                Notary Public, State of New York
               No.  43-4934758
                            Qualified in Richmond County
                                Commission Expires April 8, 1998

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EXHIBIT 31.1

CERTIFICATIONS

I, Joann McNiff, certify that:                                                  

I have reviewed this quarterly report on Form 10-Q of Elsinore Corporation;     

Based on my  knowledge,  this report does not contain any untrue  statement of a
material fact or omit to state a material fact  necessary to make the statements
made, in light of the  circumstances  under which such statements were made, not
misleading with respect to the period covered by this report;                   

Based on my knowledge, the financial statements, and other financial information
included in this report,  fairly present in all material  respects the financial
condition,  results of  operations  and cash flows of the  registrant as of, and
for, the periods presented in this report;                                      

The  registrant's  other  certifying   officer(s)  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:        

     Designed such disclosure controls and procedures, or caused such disclosure
     controls and  procedures to be designed  under our  supervision,  to ensure
     that  material  information  relating  to  the  registrant,  including  its
     consolidated  subsidiaries,  is made  known to us by  others  within  those
     entities,  particularly  during the  period in which  this  report is being
prepared;                                                             

     Evaluated the  effectiveness  of the registrant's  disclosure  controls and
     procedures  and  presented  in  this  report  our  conclusions   about  the
     effectiveness of the disclosure  controls and procedures,  as of the end of
the period covered by this report based on such evaluation; and       

     Disclosed in this report any change in the  registrant's  internal  control
     over financial  reporting that occurred during the registrant's most recent
     fiscal  quarter (the  registrant's  fourth fiscal quarter in the case of an
     annual report) that has  materially  affected,  or is reasonably  likely to
     materially  affect,  the  registrant's   internal  control  over  financial
reporting; and                                                        

The registrant's other certifying officer(s) and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's  auditors  and the audit  committee  of the  registrant's  board of
directors (or persons performing the equivalent functions):                     

     a)   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
    record, process, summarize and report financial information; and

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     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
control over financial reporting.                           

Date:  November 6, 2003                                                         
-----------------                                                 

/s/ Joann McNiff                                                                
------------------                                                              
Joann McNiff                                                                    
President                                                                       

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EXHIBIT 31.2

CERTIFICATIONS

I, Gina L. Mastromarino, certify that:                                          

I have reviewed this quarterly report on Form 10-Q of Elsinore Corporation;     

Based on my  knowledge,  this report does not contain any untrue  statement of a
material fact or omit to state a material fact  necessary to make the statements
made, in light of the  circumstances  under which such statements were made, not
misleading with respect to the period covered by this report;                   

Based on my knowledge, the financial statements, and other financial information
included in this report,  fairly present in all material  respects the financial
condition,  results of  operations  and cash flows of the  registrant as of, and
for, the periods presented in this report;                                      

The  registrant's   other   certifying   officers  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:        

     Designed such disclosure controls and procedures, or caused such disclosure
     controls and  procedures to be designed  under our  supervision,  to ensure
     that  material  information  relating  to  the  registrant,  including  its
     consolidated  subsidiaries,  is made  known to us by  others  within  those
     entities,  particularly  during the  period in which  this  report is being
prepared;                                                             

     Evaluated the  effectiveness  of the registrant's  disclosure  controls and
     procedures  and  presented  in  this  report  our  conclusions   about  the
     effectiveness of the disclosure  controls and procedures,  as of the end of
the period covered by this report based on such evaluation; and       

     Disclosed in this report any change in the  registrant's  internal  control
     over financial  reporting that occurred during the registrant's most recent
     fiscal  quarter (the  registrant's  fourth fiscal quarter in the case of an
     annual report) that has  materially  affected,  or is reasonably  likely to
     materially  affect,  the  registrant's   internal  control  over  financial
reporting; and                                                        

The registrant's other certifying officer(s) and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's  auditors  and the audit  committee  of the  registrant's  board of
directors (or persons performing the equivalent functions):                     

     a)   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
    record, process, summarize and report financial information; and

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     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
control over financial reporting.                           

Date:  November 6, 2003                                                         
-----------------                                                 

/s/ Gina L. Mastromarino                                                        
---------------------------                                                     
Gina L. Mastromarino                                                            
Principal Financial and Accounting Officer                                      

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EXHIBIT 32.1

ELSINORE CORPORATION

 CERTIFICATION

In connection with the periodic report of Elsinore  Corporation  (the "Company")
on Form  10-Q  for the  period  ended  September  30,  2003 as  filed  with  the
Securities and Exchange Commission (the "Report"), I, Joann McNiff, President of
the Company,  hereby certify as of the date hereof, solely for purposes of Title
18, Chapter 63,  Section 1350 of the United States Code,  that to the best of my
knowledge:                                                                      

     (1)  the Report fully  complies with the  requirements  of Section 13(a) or
     15(d), as applicable, of the Securities Exchange Act of 1934, and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
        material respects, the financial condition and results of operations
of the Company at the dates and for the periods indicated.  

A signed  original of this written  statement  required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature that
appears in typed form within the  electronic  version of this written  statement
required by Section 906,  has been provided to Elsinore  Corporation and will be
retained by Elsinore  Corporation  and furnished to the  Securities and Exchange
Commission or its staff upon request.                                           

This  Certification  has not been,  and shall not be  deemed,  "filed"  with the
Securities and Exchange Commission.                                             

Date: November 6, 2003                              /s/ Joann McNiff            
----------------                              --------------------  
                                               Joann McNiff, President

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EXHIBIT 32.2

ELSINORE CORPORATION

 CERTIFICATION

In connection with the periodic report of Elsinore  Corporation  (the "Company")
on Form  10-Q  for the  period  ended  September  30,  2003 as  filed  with  the
Securities and Exchange  Commission  (the  "Report"),  I, Gina L.  Mastromarino,
Principal  Financial  and  Accounting  Officer,  hereby  certify  as of the date
hereof,  solely for purposes of Title 18, Chapter 63, Section 1350 of the United
States Code, that to the best of my knowledge:                                  

     (1)  the Report fully  complies with the  requirements  of Section 13(a) or
     15(d), as applicable, of the Securities Exchange Act of 1934, and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
of the Company at the dates and for the periods indicated.  

A signed  original of this written  statement  required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature that
appears in typed form within the  electronic  version of this written  statement
required by Section 906,  has been provided to Elsinore  Corporation and will be
retained by Elsinore  Corporation  and furnished to the  Securities and Exchange
Commission or its staff upon request.                                           

This  Certification  has not been,  and shall not be  deemed,  "filed"  with the
Securities and Exchange Commission.                                             

Date: November 6, 2003               /s/ Gina L. Mastromarino                   
----------------               -------------------------            
              Gina L. Mastromarino
                                    Principal Financial and Accounting Officer

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10-Q’ Filing	Date	First	Last	Other Filings

	12/31/03	10
Filed on:	11/7/03
	11/6/03	24	36
For Period End:	9/30/03	1	36
	9/15/03	26
	8/13/03	23		8-K
	8/1/03	11	23	3, PRE 14C
	7/31/03	8	20
	7/2/03	26
	7/1/03	9	20
	6/30/03	8		10-Q, NT 10-Q
	6/15/03	9	20
	5/31/03	9	20
	5/30/03	23		PRE 14C
	4/29/03	8	19
	3/31/03	23		10-K, 10-Q
	1/1/03	6	19
	12/31/02	3	20	10-K
	9/30/02	2	19	10-Q
	7/1/02	17	19	8-K
	6/27/02	11	19
	6/1/02	17
	3/14/02	11	19	8-K
	10/13/98	23		8-K
	9/29/98	12	25
	4/8/98	30
	3/4/97	26
				List all Filings

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Elsinore Corp – ‘10-Q’ for 9/30/03

On: Friday, 11/7/03, at 9:35am ET · For: 9/30/03 · Accession #: 311049-3-15 · File #: 1-07831

Previous ‘10-Q’: ‘10-Q’ on 8/19/03 for 6/30/03 · Latest ‘10-Q’: This Filing

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Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Form 10-Q
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