Archon Corporation

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International Guild of Hospitality & Restaurant Managers

Archon Corporation (OTC BB:ARHN.OB)

3993 Howard Hughes Pkwy, Suite 630
Las Vegas, NV 89109

Phone: (702) 732-9120
Fax: (702) 658-4302

Archon Corporation, incorporated in 1993, is engaged in the hotel and casino business through its wholly owned subsidiary corporation, Pioneer Hotel Inc. (PHI). PHI operates the Pioneer Hotel and Gambling Hall in Laughlin, Nevada, under long-term lease and license arrangements. In addition, the Company owns real estate on Las Vegas Boulevard South (the Strip) and at the corner of Rainbow and Lone Mountain Road, both in Las Vegas, Nevada, and also owns investment properties in Dorchester, Massachusetts, and Gaithersburg, Maryland.

Hotel and Casino Operations

The Pioneer, built in 1982, features a classical western architecture style and is located in Laughlin, Nevada, an unincorporated town on the Colorado River bordering Arizona. The Pioneer is located on approximately 12 acres of land with Colorado River frontage of approximately 770 feet and is situated near the center of Laughlin's Casino Drive. The property is leased from a third party under a lease that expires in December 2020, subject to two five-year options to extend the term. The third party in turn leases approximately 6 1/2 acres of the 12 acres under a 99-year ground lease, which by its terms, is scheduled to terminate in December 2078. The leased land lies between and separates the remaining two parcels of land that are held in fee simple. The Pioneer is comprised of four buildings.

One of the three motel buildings, together with a portion of both the Pioneer's casino building and a second motel building, are located on land subject to the Pioneer Ground Lease. The casino is located in the main building, totaling approximately 50,000 square feet of which approximately 21,500 square feet house the casino. The casino has a snack bar and gift shop, as well as a 24-hour restaurant, kitchen, smoke shop, special events area, restrooms and storage areas. A partial second floor houses a gourmet restaurant, administrative offices and banquet rooms. The three motel buildings were built in 1984 and are comprised of approximately 66,000, 54,000 and 30,000 square feet, respectively. A total of 417 motel rooms are housed in the three buildings and improvements include a swimming pool and spa.

The primary source of revenues to the Company's hotel-casino operations is gaming, which represented 60.3% of total revenues in 2002. The Pioneer contributed 100% to total gaming revenues during the fiscal year ended September 30, 2002 (fiscal 2002). As of September 30, 2002, the Pioneer had 819 slot machines, nine blackjack tables, two craps tables, one roulette wheel and three other gaming tables. In addition, the Pioneer offers keno.

The Pioneer targets primarily mature, out-of-town customers residing in central Arizona and southern California, as well as retirees who reside in the northeast and midwest United States and Canada and travel to the southwest United States during the winter months. The Pioneer also targets local residents who reside in Laughlin, Nevada, and in Bullhead City, Kingman and Lake Havasu, Arizona. The occupancy rate at the Pioneer was 75% in fiscal 2002.

Investment Properties

Archon acquired investment properties in Dorchester, Massachusetts, and Gaithersburg, Maryland, in March 2001. The Dorchester, Massachusetts, property is located on 12 acres and includes several buildings with approximately 425,000 square feet of commercial office space. The property is under a net lease through 2019 with a single tenant with an investment grade credit rating. Under the lease, the tenant is responsible for substantially all obligations related to the property.

The property in Gaithersburg, Maryland, is located on 55 acres and includes one building with approximately 342,000 square feet of commercial office space. The building is located on approximately 20 acres of the property. The property is under a net lease through 2014 with a single tenant with an investment grade credit rating. Under the lease, the tenant is responsible for substantially all obligations related to the property.

Land Held for Development

The Company owns, through Sahara Las Vegas Corporation (SLVC), an indirect wholly owned subsidiary of Archon, an approximately 27-acre parcel of real property on the Strip. In connection with the acquisition of the property, the Company assumed an operating lease under which a water theme park operates. Archon may terminate the lease at any time. A loan owed by the tenant to the former owner would have been payable by SLVC if it terminated the lease prior to December 31, 2004, however, that loan was paid in full by the tenant in July 2002.

Archon owns, through SFHI, an approximately 20-acre parcel of real property located next to the Santa Fe at the intersection of Rainbow and Lone Mountain. The Company and SFHI have granted to the buyer of the SFHI assets an option to purchase the property through October 2003.

Disclaimer:
The data included within the Financial section is solely for information and does not construe a recommendation and/or endorsement by IGHRM or its members to invest funds with any of the companies listed. You are strongly advised to obtain professional advice with qualified individuals or corporations for any investments of funds.

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