CREATOR CAPITAL LIMITED
Cedar House, 41 Cedar Street
Hamilton, HM12, Bermuda
May 1, 2001
To Our Shareholders:
You are cordially invited to attend the 2000 Annual General
Meeting of Shareholders of Creator Capital Limited, a Bermuda
exempted company (the "Company" or "CCL"), which will be held at
10:00 a.m., Eastern Daylight Time, on June 7, 2001, at 41 Cedar
House, Hamilton, HM 12, Bermuda. (the "Annual General Meeting").
At the Annual General Meeting, Shareholders will vote to: (i)
elect six persons to the Board of Directors; (ii) re-appoint
Buckley Dodds as CCL's auditor; (iii) To consider and, if
thought fit, to approve and ratify incentive stock options, and
amendments to incentive stock options, to purchase shares of CCL
granted, which have not previously been approved by the
shareholders. To authorize the directors, in their discretion
to grant stock options, and to amend stock options granted,
subject to any regulatory approvals; (iv) receive and consider
the report of the directors to the shareholders and the
financial statements of the CCL, together with the auditor's
report thereon for the financial year ended December 31, 2000
,and (v) transact such other business as may properly come
before the Annual General Meeting, Further information
concerning the meeting and the nominees for director can be
found in the accompanying Notice and Proxy Statement.
We hope that you can attend the Annual General Meeting and
assist the Board of Directors by voting for the election of
directors; the granting of incentive stock options, and the
ratification of the appointment of the auditors. Whether or not
you plan to
attend the Annual General Meeting, please be sure to date, sign
and return the proxy card in the enclosed, postage-paid envelope
as promptly as possible so that your shares may be represented
at the meeting and voted in accordance with your wishes. If you
attend the meeting, you may vote in person, even if you have
previously submitted a proxy card.
Sincerely,
"Deborah Fortescue-Merrin"
Deborah Fortescue-Merrin
Chairman of the Board
CREATOR CAPITAL LIMITED
Cedar House, 41 Cedar House
Hamilton HM 12, Bermuda
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD ON June 7, 2001
NOTICE IS HEREBY GIVEN that the Annual General Meeting of
the
Shareholders ("Annual General Meeting") of CREATOR CAPITAL
LIMITED, a Bermuda exempted company (the "Company" or "CCL"),
will be held at Cedar House, 41 Cedar Street, Hamilton HM 12,
Bermuda, on June 7, 2001, at the hour of 10:00 a.m., Eastern
Daylight Time, for the following purposes:
1. To elect six persons to the Board of Directors;
2. To re-appoint Buckley Dodds as the Company's auditors;
3. To consider and, if thought fit, to approve and ratify
incentive stock options, and amendments to incentive stock
options, to purchase shares of the Company granted to insiders
which have not previously been approved by the shareholders.
To authorize the directors, in their discretion to grant stock
options to insiders, and to amend stock options granted to
insiders, subject to any regulatory approvals.
4. To receive and consider the report of the directors to the
shareholders and the financial statements of the Company
together with the auditor's report thereon for the financial
year ended December 31, 2000, and
5. To transact such other business as may properly come before
the Annual General Meeting.
This Notice and Proxy Statement and the enclosed form of proxy
are being sent only to shareholders of record and beneficial
owners of whom the Company is aware as of May 1, 2001. However,
all shareholders of record on the date of the meeting are
entitled to
attend and to vote at the Annual General Meeting. The Company's
Form 10-K Annual Report for the year ended December 31, 2000,
including audited financial statements, is included with this
mailing of the Proxy Statement and this Notice.
We hope you will be represented at the Annual General Meeting by
signing, dating and returning the enclosed proxy card in the
accompanying envelope as promptly as possible, whether or not
you expect to be present in person. Your vote is important -- as
is the vote of every shareholder -- and the Board appreciates
the cooperation of shareholders in directing proxies to vote at
the meeting.
Your proxy may be revoked at any time by following the
procedures set forth in the accompanying Proxy Statement, and
the giving of your proxy will not affect your right to vote in
person if you attend the Annual General Meeting.
By Order of the Board of Directors
"Deborah Fortescue-Merrin"
Deborah Fortescue-Merrin
Chairman of the Board
DATED: May 1, 2000
CREATOR CAPITAL LIMITED
Cedar House, 41 Cedar House
Hamilton HM12, Bermuda
PROXY STATEMENT
For the Annual General Meeting of Shareholders
June 7, 2001
This proxy statement is being furnished in connection with the
solicitation of proxies by the Board of Directors (the "Board")
of CREATOR CAPITAL LIMITED, a Bermuda exempted company ("the
Company" or "CCL"), for use at the Annual General Meeting of the
Company to be held at Hamilton, Bermuda, on June 7, 2001, at
10:00 a.m.,
Eastern Daylight Time, and at any adjournments or postponements
thereof (the "Annual General Meeting"). Unless the context
otherwise requires, references to the Company include CCL and
its subsidiaries. The proxy is revocable by (i) filing a
written
revocation with the Secretary of the Company prior to the voting
of such proxy, (ii) giving a later dated proxy, or (iii)
attending the Annual General Meeting and voting in person.
Shares represented by all properly executed proxies received
prior to the
Annual General Meeting will be voted at the meeting in the
manner specified by the holders thereof. Proxies that do not
contain voting instructions will be voted; (i) FOR the election
of the nominees approved by the Board; (ii) FOR the re-
appointment of
Buckley Dodds as the Company's auditors; (iii) FOR the
granting, and amending of incentive stock options at the
discretion of the Board of Directors; and (iv) if any other
matters properly come before the Annual General Meeting, in
accordance with the best
judgment of persons designated as proxies.
The Board has established May 7, 2001, as the date used to
determine those record holders and beneficial owners of Common
Stock to whom notice of the Annual General Meeting will be sent
(the "Record Date"). On the Record Date, there were 50,103,529
shares of common stock, par value US$.01 per share (the "Common
Stock"), outstanding. The holders of the Common Stock are
entitled to one vote for each share of Common Stock held. All
matters presented at the Annual General Meeting require
approval by a simple majority of votes cast at the meeting.
The presence, in person or by proxy, at the Annual General
Meeting of at least two shareholders entitled to vote is
necessary to constitute a quorum at the Annual General Meeting.
This Notice, Proxy Statement and enclosed form of proxy are
first being
mailed on or about May 7, 2001.
PROPOSAL 1
ELECTION OF DIRECTORS
In accordance with the Company's Bye-Laws, six directors are to
be elected at this Annual General Meeting. The Board recommends
the election to the Board of the nominees whose names appear
below. Directors of the Company are elected at each annual
general meeting and hold office until the next annual general
meeting or until their successors are nominated and elected. In
the absence of instructions to the contrary, the enclosed proxy
will be voted FOR the nominees listed below.
Pursuant to the ByeLaws of the Company, one director may be
appointed by Harrah's Interactive Investment Company, a Nevada
Corporation ("HIIC", and together with its affiliates, the "HIIC
Entities"), pursuant to ByeLaw 54B. Bye-Law 54B provides that
during such time as the HIIC Entities own 10% or more of the
outstanding voting securities, or their equivalents, of the
Company, on a fully-diluted basis, the HIIC Entities will have
the ability to appoint a percentage of directors (rounded to the
nearest 10%). This percentage of directors has the same
proportion to the size of the entire Board as the number of such
voting securities held by the HIIC Entities bears to the total
number of such securities, on a fully diluted basis. The HIIC
Entities will also be entitled to such proportionate
representation on the Executive, Compensation and Audit
Committees of the Board. On the Record Date, the HIIC Entities
owned approximately 6,886,915 of the outstanding voting
securities, or their equivalents, of the Company.
The HIIC Entities have elected not to exercise their right to
appoint a member to the Board for the coming year.
With respect to the nominees for the six members of the Board to
be elected by the shareholders of the Company at the Annual
General Meeting, the following sets forth the name of each
nominee and, for each, the period during which the nominee has
served as a director, information relating to the nominee's age,
principal occupation and business experience during the past
five years, any other directorships held by the nominee in
publicly held companies and certain other information.
Information with
respect to the ages of directors is as of June 30, 2000, and
information as to their ownership of shares of Common Stock as
of that date is provided under the caption "Security Ownership
By Directors, Officers and Five Persons (or More) Shareholders."
MR MICHAEL BARTLETT, age 58, has been a director of the company
since September of 2000. Mr Bartlett is a thirty-year veteran
of the thumbed entertainment industry. During his career, Mr.
Bartlett has held the following senior positions:
President & CEO Expo 86 (Vancouver, Canada), Senior VP Planning
& Development, Universal Studios (Florida), Vice President &
General Manager, Canada's Wonderland (Toronto, Canada),
President & CEO, Natural Maritime Authority (Norfolk, Virginia),
Vice President, Planning & Development Taft Broadcasting Theme
Park Division
(Cincinnati, Ohio). Currently, Mr. Bartlett is the President
and CEO of Indico Technologies and Creative Entertainment
Technologies, both publicly traded companies.
ANTHONY P. CLEMENTS, age 54, has been a director of the Company
since March of 1992. Mr. Clements is an investment banker with
Yorkton Securities, based in London, England. From 1994 to
March 1998, he was an investment banker with T. Hoare & Co. Mr.
Clements also served as a director of the Company's operating
subsidiary from August 10, 1995 until its amalgamation with the
Company on June 17, 1997. Prior to 1994, Mr. Clements was an
investment banker for Rickets & Co., also based in London.
Mr. Clements has also managed the North American portfolio of
Postel Investment Management (pension fund managers for both the
Post Office and British Telecom) from 1973 until 1987, and has
worked in areas of corporate finance since 1987.
DEBORAH FORTESCUE-MERRIN, age 45, has been a director of the
Company since September 10, 1999, and she was previously a
director of the Company from October 1995 to October 1997. Mrs.
Merrin is Vice-President of J. Perot Financial Corp., a
private investment management firm located in Vancouver, British
Colombia, Canada. Previous to joining J. Perot Financial, Mrs.
Merrin was a securities broker for twelve years, and worked in
the area of corporate finance from 1989-1992, specializing in
special situations concerning medical issues. Mrs. Merrin is the
President and a Director of North American Medical Services Inc.
and she is also a director of Creative Entertainment
Technologies, Inc., and Indico Technologies, each publicly
traded companies. Mrs Merrin is also currently the President,
and Chairman of IEL.
MR B.J. (JACK) ILES, age 68, has been a director of the Company
since September of 2000. Mr Iles is a founding partner of
Smythe Ratcliffe, Chartered Accountants (the Western Canadian
Affiliate of Pannell Kerr Forster) exclusively engaged in
matters of
taxation, which has been his vocation for forty years. Mr Iles
has served with the Canadian Federal Taxation Authorities and
the Comptroller of the Treasury. Mr Iles limits his practice to
international and multi-national commercial ventures,
specializing
in maximizing after-tax cash flow and income retention. He has
extensive experience in all areas of tax practice with special
emphasis on planning and structuring for startup enterprises.
Mr Iles' career has spanned three continents, innumerable
countries, and tax regimes. A seminar leader, lecturer, author
of papers and articles, Mr Iles is also a director and former
director of several private and not-for-profit companies and
societies.
ANASTASIA KOSTOFF-MANN, age 53, has been a director since
September 10, 1999, and she was previously a director of the
Company until September 1996. Ms Mann has over 28 years
experience in the hotel, sales and marketing, and travel
industry. She is the Founder and Chairman of the Corniche Group
of Companies, overseeing all aspects of travel and meeting
management for corporate accounts. She is a lifetime director
and former President and Chairman of the International Travel &
Tourism Research Association (TTRA). She currently serves a
commissioner on the California Travel and Tourism Commission
where she also sits on the Executive Committee. Ms Mann is also
currently the Vice President of IEL.
STEPHEN ROSENBERG, age 56, has been a director since September
10, 1999. He has been President of his own investment advisory
firm located in Warner Robins, Georgia, since January of 1989.
From December 1985 through December 1988, Mr. Rosenberg was a
broker with Dean Witter Reynolds. He has taught graduate
finance courses for Mercer University in Macon, Georgia, and is
the author of a number of financial books. Mr. Rosenberg has
appeared on CNN, CNBC and other radio and television programs as
a financial expert and estate planning authority. He hosts a
weekly radio program and appears on his local CBS affiliate.
Mr. Rosenberg is also a Director of North American Medical
Services Inc., a publicly traded company.
The Company is not aware of any arrangements or understandings
between any of the individuals named above and any other person
pursuant to which any of the individuals named above were
selected as a director and/or executive officer. The Company is
not aware of any family relationship among the officers and
directors of the Company or its subsidiaries. The only
arrangement with respect to members of the Board of which the
Company is aware is the right of the HIIC Entities to appoint
directors to the Board
pursuant to ByeLaw 54B of the Company's ByeLaws.
OTHER INFORMATION ABOUT THE BOARD AND ITS COMMITTEES
Meetings:
The Board of Directors did not hold any formal meetings
during the fiscal year ended December 31, 2000. Pursuant to the
Company's current Bye-Laws, the Board consists of six directors.
Compensation:
At the December 6, 1996 meeting of the Board, the Board
adopted an option plan covering 500,000 shares of Common Stock
for members of the Board (the "Director Option Plan"). Pursuant
to the Director Option Plan, all directors holding office at
December 10th of each year automatically were granted options
for the purchase of 10,000 shares of Common Stock at the trading
price on such day. On October 17, 1997, the Board approved an
amendment to the Director Option Plan changing the grant date to
the date of the first meeting of the Board following the
Company's Annual
General Meeting of Shareholders. Options granted pursuant to
the Director Option Plan have a ten-year term. On September 19,
2000, the directors of the Company were not awarded any stock
options.
All of the directors of the Company are re-imbursed for out-of-
pocket expenses. The directors of the Company receive no other
compensation.
Executive Committee
The Executive Committee of the Board currently consists of Ms
Fortescue-Merrin, Mr Tony Clements, and Mr Stephen Rosenberg.
The principal functions of the Executive Committee are to
exercise the power of the Board in the management of the
business and affairs of the Company with certain exceptions. The
executive committee did not hold any meetings during the fiscal
year ended December 31, 2000.
Audit Committee
The Audit Committee of the Board currently consists of Ms
Fortescue-Merrin, Mr Jack Iles, and Mr Stephen Rosenberg. The
principal functions of the Audit Committee are to make
recommendations to the Board regarding; (i) its independent
auditors to be nominated for election by the shareholders; (ii)
to review the independence of such auditors; (iii) to approve
the scope of the annual audit activities of the independent
auditors; (iv) to approve the audit fee payable to the
independent auditors; (v) and to review such audit results. The
audit committee did not hold any meetings during the fiscal year
ended December 31, 2000.
Compensation Committee
The Compensation Committee currently consists of Ms Mann, Mr
Tony Clements, and Mr Stephen Rosenberg. The Compensation
Committee did not hold any meetings during the fiscal year ended
December 31, 2000. For information on the duties and actions of
the Compensation Committee, see "Report on Compensation."
SECURITY OWNERSHIP BY DIRECTORS, OFFICERS AND
FIVE PERCENT (OR MORE) SHAREHOLDERS
As of June 30, 2000, based on information supplied to the
Company, CCL's directors and executive officers as a group may
be deemed to own beneficially (including shares purchased upon
exercise of stock options and warrants, exercisable within 60
days) 1.19% of the outstanding shares of Common Stock. To the
knowledge of the directors and officers of the Company, the
following directors and officers of the Company and owners of
five percent (or more) of the outstanding Common Stock
beneficially own the shares of Common Stock set forth below.
Name
Amount and Nature Of Beneficial
Ownership
Percent of
Class (1)
Michael L Bartlett
Anthony P. Clements (2)
Deborah Fortescue-Merrin
(3)
Jack Iles
Anastasia Kostoff-Mann (5)
Stephen Rosenberg (6)*
Directors and Officers as a
Group
(7 individuals)
Harrah's Interactive
Investment
Company (HIIC) (9)
NIL
190,000
220,000
NIL
110,000
76,500
596,500
6,886,915
*
*
*
*
*
*
1.19%
13.01%
*Less than 1%
(1) Percent of class is determined by dividing the number of
shares beneficially owned by the outstanding number of shares of
the Company, and increased by options and warrants for 2,922,761
shares, which are currently exercisable.
(2) Includes options for 100,000 shares of Common Stock under
the 1996 Stock Program, options for 40,000 shares under the
Directors Option Plan, and options for 50,000 shares granted
under the Management Incentive Plan.
(3) Does not include 376,471 shares of Common Stock held by a
company which Ms. Fortescue-Merrin's spouse controls. Does not
include three Class B Series A Convertible Preference Shares,
which have been donated to a charitable foundation of which both
Mr & Mrs Merrin are directors. Does not include 34 Class B
Series A Convertible Preference Shares, which have been donated
to a charitable foundation of which both Mr & Mrs Merrin are
directors. Includes options for 150,000 shares of Common Stock
under the 1996 Stock Program, options for 20,000 shares of
Common Stock under the Directors Option Plan, and options for
50,000 shares granted under the Management Incentive Plan.
(4) Includes options to purchase 50,000 shares of Common Stock
under the 1996 Stock Program, 10,000 shares under the Directors
Option Plan, and options for 50,000 shares granted under the
Management Incentive Plan.
(5) Does not include 38,200 shares held by Mr. Rosenberg's
spouse. Includes options for 10,000 shares under the Directors
Option Plan and options for 50,000 shares granted under the
Management Incentive Plan.
(6) Harrah's Interactive Investment Company's address is 1
Harrah's Court, Las Vegas,Nevada, 89119-4312.
EXECUTIVE COMPENSATION
The following table sets forth all compensation for services
in all capacities to the Company for the three most recently
completed fiscal years in respect of each of the individuals who
served as the Chief Executive Officer during the last completed
fiscal year and those individuals who were, as of December 31,
2000, the executive officers of the Company whose individual
total compensation for the most recently completed financial
year exceeded $100,000 (collectively, the "Named Executive
Officers")
including any individual who would have qualified as a Named
Executive Officer but for the fact that individual was not
serving as such an Officer at the end of the most recently
completed financial year:
SUMMARY COMPENSATION TABLE
Annual Compensation
Long Term
Compensation
Awards
.
Name and
Principal Position
Fiscal
Year
Ended
Salary
($)
Bonus
($)
Other
Annual
Compensat
ion ($)
Restrict
ed
Stock
Awards
(#)
Securiti
es
Underl
ying
Option
s (#)
Deborah
Fortescue-Merrin
Chairman
12/31/00
12/31/99
US$23,
000
NIL
NIL
NIL
NIL
NIL
NIL
NIL
60,000
OPTION GRANTS IN THE LAST FISCAL YEAR
There were no option grants to employees during the year ending
December 31, 2000.
Name
No of
Securities
Underlyin
g Options
Granted
(#)
Percent of
Total Options
Granted to
Directors and
Officers in
Fiscal Year
Exercis
e or
Base
Price
($/sh)
Expirat
ion
Date
Potential
Realizable Value
At Assumed
Annual Rates of
Stock Price
Appreciation for
Option Term
5%
10%
John Boushy
John Boushy
Tony
Clements
Tony
Clements
Deborah
Merrin
Deborah
Merrin
Anastasia
Mann
Anastasia
Mann
Stephen
Rosenberg
Stephen
Rosenberg
10,000(1)
50,000(2)
10,000(1)
50,000(2)
10,000(1)
50,000(2)
10,000(1)
50,000(2)
10,000(1)
50,000(2)
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
$0.140
00
$0.500
00
$0.140
00
$0.500
00
$0.140
00
$0.140
00
$0.500
00
$0.140
00
$0.500
00
$0.140
00
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
9-10-
09
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
*Less than 1%
(1) Option granted to each director of the Company pursuant to
the Director Option
Plan on September 10, 1999.
(2) Options granted under the Management Incentive Plan
FISCAL YEAR-END OPTION VALUES
No options were exercised by the Named Executive Officers
during the fiscal year ended December 31, 1999. No options
listed in this table were in-the- money at the end of the fiscal
year ended December 31, 1999.
Number of Securities Underlying Unexercised
Options at Fiscal Year End 2000
Name
Exercisable
Unexercisable
Deborah Fortescue-
Merrin(1)
Deborah Fortescue-
Merrin(2) --
Deborah Fortescue-
Merrin(3) --
150,000
20,000
50,000
NIL
NIL
NIL
(1) Options issued pursuant to the 1996 Stock Program.
(2) Options issued pursuant to Director Option Plan.
(3) Options issued pursuant to the Management Incentive Plan.
REPORT ON COMPENSATION
Ms Deborah Merrin served as President & Chairman of the CCL in
the fiscal year 2000. She was compensated on a consulting
basis, and received US$ 23,000 during 2000.
The Members of the Board of Directors during The Fiscal Year
Ended December 31, 2000.
Michael L Bartlett
John M. Boushy
Eppie Canning
Anthony P. Clements
Deborah Fortescue-Merrin
B.J. (Jack) Iles
Anastasia Kostoff-Mann
Stephen Rosenberg
PROPOSAL 2
APPOINTMENT OF AUDITOR
Unless otherwise instructed, the proxies given pursuant to
this solicitation will be voted FOR the appointment of Buckley
Dodds as the auditor of the Company, to hold office for the
ensuing year, at a remuneration to be negotiated by management,
and approved by the Board.
PERFORMANCE GRAPH
Comparison of Five-Year Cumulative Total Shareholder Return on
Common Shares of the Corporation, and the CRSP Total Return
Index for NASDAQ U.S. and Foreign Stocks based on a $100
Investment assuming reinvestment of Dividends
IEL NASDAQ IEL NASDAQ
------- ------ ------- ------
12/31/93 4.725 253.873 100 100
12/30/94 5.625 246.250 119 97
12/29/95 2.750 345.863 58 136
12/31/96 3.750 423.427 79 167
12/31/97 2.875 517.841 61 204
12/31/98 0.03125 715.138 1 282
12/31/99 0.03125 1334.576 1 527
12/31/00 0.03125 805.041 1 317
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Redemption Agreement: As of April 30, 1997, pursuant to
Redemption Agreements (the "Redemption Agreements"), the Company
issued to recipients designated by Dr. Rex E. Fortescue,
formerly a director of the Company, and Anthony P. Clements, a
director of the Company, 175,000 and 333,000 shares of Common
Stock, respectively. These shares were issued as consideration
for Messrs. Fortescue's and Clements' agreement to place into
escrow 1,525,000 shares of Common Stock (of which 525,000 are
registered in the name of Dr. Fortescue and 1,000,000 are
registered in the name of Mr. Clements, which are held in an
escrow pursuant to a performance earn-out provision, only if
such shares are released from the escrow for any reason
whatsoever. Dr. Fortescue is the father of Deborah Fortescue-
Merrin, Chairman of the Board and
President of the Company.
Amalgamations: Pursuant to a Plan and Agreement of Merger
and Amalgamation, dated as of May 13, 1997 (the "Amalgamation
Agreement"), the Company's then wholly-owned subsidiary SGI
Holding Corporation Limited, a Bermuda exempted company
("SGIHC"), amalgamated with and into its 80% owned subsidiary,
then known
as Interactive Entertainment Limited, a Bermuda exempted company
("Operating Sub"). The Amalgamation Agreement is between the
Company, Operating Sub, SGIHC and HIIC, the former owner of 20%
of the outstanding stock of Operating Sub. Pursuant to the
Amalgamation Agreement, Operating Sub amalgamated with and into
SGIHC and thereafter SGIHC amalgamated with and into the Company
(the "Amalgamations"). As a result of the Amalgamation of
Operating Sub and SGIHC, the outstanding shares of Operating Sub
common stock held by HIIC were converted into 5,879,040 shares
of
Common Stock. Pursuant to the Amalgamation Agreement, HIIC and
its affiliates were provided, through certain amendments to the
Bye-Laws of the Company, (approved at the Special General
Meeting of Shareholders of the Company held June 16, 1997), with
the right to appoint persons (the "HIIC Appointees") to the
Board, and to specified committees in a number generally
proportionate to their share holdings. Additionally, the HIIC
Entities, as shareholders, and the HIIC Appointees were
provided, pursuant to
the Amalgamation Agreement, with the right to approve specified
significant corporate actions by the Company for as long as the
ownership of Common Stock by the HIIC Entities is in excess of
20% (10% in some cases) of the outstanding voting shares
computed on a fully-diluted basis. The total number of shares
owned by HIIC is
6,886,915, currently representing 13.01% of the outstanding
common shares.
HIIC License Agreement: On June 17, 1997, in connection with
the Amalgamations, the Company also entered into a Software
License Agreement with HIIC (the "License Agreement"). The
License Agreement is a fully-paid, perpetual world-wide license
to
the HIIC Entities to use the Company's gaming technology in non-
competitive uses in traditional casino venues which the HIIC
Entities own, operate or manage. The License Agreement includes
source codes for the Company's gaming software, and neither
party to the License Agreement has any obligation to share or
provide any improvements or modifications with the other party.
HIIC Registration and Preemptive Rights: Also on June 17,
1997 and in connection with the Amalgamations, the Company
entered into a Registration and Preemptive Rights Agreement with
HIIC (the "Registration Rights Agreement"). Under the
Registration Rights Agreement, the HIIC Entities have two demand
registration rights to cause the Company to register the Common
Stock owned by the HIIC Entities. Each such offering is
required to be underwritten on a firm commitment basis by an
underwriter chosen by the Company. Pursuant to the Registration
Rights Agreement,
until the earlier of when the HIIC Entities own less than 5% of
the outstanding voting shares of the Company on a fully-diluted
basis, the HIIC Entities have customary piggy-back rights to
include their shares of Common Stock in registered offerings by
the Company. Pursuant to the Registration Rights Agreement, the
HIIC Entities have the right to purchase securities offered by
the Company for as long as the HIIC Entities own 20% or more of
the outstanding Common Stock on a fully-diluted basis at the
same price and terms such securities are otherwise being
offered. The HIIC Entities also have the right for as long as
the HIIC Entities own 20% or more of the outstanding voting
shares on a fully-diluted basis to participate on a
proportionate basis in any non-
pro rata stock repurchases or redemptions conducted by the
Company. Additionally, at any time that the HIIC Entities own
less than 10% of the outstanding voting shares, on a fully-
diluted basis, the Company has the right to cause the HIIC
Entities to sell their voting shares pursuant to a registered
sale, and the HIIC Entities have the right to cause the Company
to file a registration statement to sell their voting shares in
the event of any change in or conduct of the business or
proposed business of the Company or any of its subsidiaries or
any other action or inaction of the Company or any of its
subsidiaries which would jeopardize the HIIC Entities' gaming
and related licenses or the if Company does not redeem a
"Disqualified Holder" (as defined in and pursuant to the
Company's Bye-Laws) of its securities, in each case at the
Company's expense without being subject to the limitations on
demand rights set forth above.
EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES
DEBORAH FORTESCUE-MERRIN, a Director of the Company was
appointed the Chairman of the Board and President at the
Directors Meeting September 11, 1999
ANASTASIA KOSTOFF-MANN, a Director of the Company was
appointed Vice-President June 9, 2000
MICHAEL IRWIN served as Assistant Secretary and Chief
Accounting Officer until his resignation on February 29, 2000.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Other than as indicated below, no director, officer or
beneficial owner of more than 10% of any class of equity
securities has failed to file reports required by Section 16(b)
of the Exchange Act for the Company's fiscal year ended December
31, 1999.
SOLICITATION OF PROXIES
The cost of soliciting proxies will be borne by the Company.
Custodians and fiduciaries will be supplied with proxy materials
to forward to beneficial owners of stock and normal handling
charges will be paid for such forwarding services.
SHARES SUBJECT TO IRREVOCABLE PROXY
AND AGREEMENT NOT TO VOTE SHARES
3,525,000 shares of Common Stock are subject to an
irrevocable proxy and an agreement not to vote, and will not be
voted at the Annual General Meeting or at any subsequent general
meeting of the shareholders of the Company. When the Company
acquired the rights to its in-flight gaming software from SGII
on November 7, 1991, a
portion of the consideration was 3,000,000 shares of Common
Stock which, according to then applicable requirements, were
placed in escrow, to be released on the basis of one share for
each U.S.$1.78 of net cash flow generated from the assets over a
ten-
year period (the "Performance Shares"). An additional 525,000
shares, which were issued to Dr. Rex E. Fortescue, formerly a
director of Sky Games, are held in the escrow on the same terms
and are also included as Performance Shares. As part of certain
agreements to allow the eventual redemption and cancellation of
the 3,525,000 Performance Shares only when and if such
Performance Shares should be released from the escrow, the
holders of the Performance Shares issued an irrevocable proxy to
First Tennessee Bank, and First Tennessee Bank entered into an
agreement not to
vote the Performance Shares at any general meeting of
shareholders of IEL or otherwise. The irrevocable proxy and the
agreement not to vote the Performance Shares will terminate upon
the cancellation of the Performance Shares. Consequently, the
3,525,000 Performance Shares will not be voted at the Annual
General Meeting or at any subsequent general meeting of the
shareholders of the Company.
OTHER MATTERS
Management of the Company is not aware of any other matter to
come before the meeting other than as set forth in the notice of
meeting. If any other matter properly comes before the meeting,
it is the intention of the persons named in the enclosed form of
proxy to vote the shares represented thereby in accordance with
their best judgment on such matter.
SHAREHOLDER PROPOSALS
Proposals of shareholders to be presented at the 2002 Annual
General Meeting of Shareholders must be received by the Company
no later than December 20, 2001 in order to be considered for
inclusion in the Company's Proxy Statement and form of proxy
relating to such meeting.
DATED: May 1, 2001.
Creator Capital Limited
Proxy for Annual General Meeting of Shareholders on June 7, 2001
This Proxy is Solicited on Behalf of the Board of Directors of
Interactive Entertainment Limited
The undersigned hereby appoints Stephen James or Hiren Patel,
or either of them, with full power of substitution, the
undersigned's true and lawful attorneys and proxies to vote the
shares of Common Stock of Creator Capital Limited, which the
undersigned is entitled to vote at the Annual General Meeting of
Shareholders to be held at Hamilton, Bermuda, on June 7, 2001 at
10:00 a.m. Eastern Daylight Time, and all adjournments or
postponements thereof, with all the powers the undersigned would
possess if personally present, as indicated on this card for the
proposals described in the Notice and Proxy Statement for such
meeting and in their discretion on such other matters as may
properly come before the meeting or any adjournments or
postponements thereof.
Unless otherwise instructed, this proxy will be voted for the
nominees listed in Proposal 4 and for approval of the matters
set forth in Proposals 1, 2, 3 and 5.
Please mark, sign and mail this proxy promptly in the enclosed
envelope.
1. Election of Director Nominees:
Messrs. Bartlett, Clements,Iles,Rosenberg,Fortescue-Merrin and
Kostoff-Mann:
[_] FOR [_] WITHHELD [_] FOR, except
nominees from nominees vote withheld from the
following nominees
___________________________________________________
2. FOR the appointment of Buckley Dodds as the Company's
auditor:
[_] FOR [_] AGAINST [_] ABSTAIN
approval approval
3. Approve and ratify incentive Stock Options:
[_] FOR [_] AGAINST [_] ABSTAIN
approval approval
Dated: _____________, 2001
No of Shares:
Signature:
Capacity/Title:
Please sign the exact name of the
shareholder as it appears hereon. If
acting as administrator, trustee or in
other representative capacity, please
sign name and title. Please check
mark, sign, date, and mail this proxy
promptly in the enclosed envelope.
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