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At any time, the Mississippi Commission has the power to investigate and require the finding of suitability of any of our record or beneficial stockholders. The Louisiana Attorney General acts as legal counsel to the Board. Changes in certain licensed positions must be reported to the Mississippi Commission. The Mississippi Commission may deny an application for a finding of suitability for any cause that it deems reasonable. In addition, under the Mississippi Act, the Mississippi Commission may in its discretion require the holder of any debt security of a Mississippi Registered Corporation to file an application, be investigated and be found suitable to own the debt security. The Board may, however, in its discretion require additional persons to file applications for permits or findings of suitability. If we are unable to continue to satisfy the registration requirements of the Mississippi Act, we and any Mississippi Gaming Subsidiary cannot own or operate gaming facilities in Mississippi. The ledger and stockholder lists must be available for inspection by the Mississippi Commission at any time. The Indiana Commission has selected an operator for the facility and has entered into an operating agreement with this operator. In addition, we, the Louisiana subsidiaries holding riverboat gaming licenses, and the persons involved in any violations of the Louisiana Act could be subject to substantial fines for each separate violation of the Louisiana Act at the discretion of the Board. Suppliers of gaming equipment and materials must also be licensed under the Indiana Act. The Mississippi Commission has adopted regulations which are also similar in many respects to the Nevada gaming regulations. Although the Mississippi Commission generally does not require the individual holders of obligations, such as our 8. The Indiana Commission has indicated it will be vigilant in monitoring attainment of these goals. Five of the riverboats are in counties contiguous to the Ohio River and five are in counties contiguous to Lake Michigan. Transactions involving publicly registered debt and securities registered with the Securities and Exchange Commission and sold pursuant to a firm underwriting agreement are, however, subject to certain notice and reporting requirements. The Louisiana Act provides that an initial license to conduct gaming operations is valid for a term of five years and may be renewed for successive five year terms after the initial term upon application and continued satisfaction of suitability standards and other provisions of the Louisiana Act. If any securities are held in trust by an agent or by a nominee, the record holder may be required to disclose the identity of the beneficial owner to the Mississippi Commission. The Indiana Commission has promulgated a rule that prohibits distributions, excluding distributions for the payment of taxes, by a licensee to its partners, shareholders, itself or any affiliated entity if the distribution would impair the financial viability of the riverboat gaming operation. Changes in Mississippi laws or regulations may limit or otherwise materially affect the types of gaming that may be conducted and such changes, if enacted, could have an adverse effect on us and our Mississippi gaming operations, if we decide to build a replacement facility in Biloxi. Any person with an ownership interest or economic interest in a licensee may be required to submit to an investigation by the Board to determine suitability. These provisions apply to all the securities offered or issued by us. We believe that our compliance with the licensing procedures and regulatory requirements of the Mississippi Commission will not affect the marketability of our securities. Certain of our officers and employees and the officers, directors and certain key employees of Casino Magic Biloxi must be found suitable or approved by the Mississippi Commission. Each Mississippi Gaming Subsidiary must maintain in Mississippi a current ledger with respect to ownership of its equity securities, and we must maintain in Mississippi a current list of our stockholders which must reflect the record ownership of each outstanding share of any class of equity securities issued by us. Contracts to which Belterra is party are subject to disclosure and approval processes imposed by the regulations. In particular, Indiana, Louisiana, Mississippi, Missouri, Nevada, California, Argentina and The Bahamas have regulations affecting the operation of our gaming business and the ownership and disposition of our securities. Those riverboats conducting dockside operations pay the admission tax on each person admitted to the riverboat. Once the Board has issued a license, the licensee must maintain suitability throughout the term of the license and any renewal terms and has a continuing duty to inform the Board of any possible violation of the Louisiana Act. As such, a gaming license may be denied, revoked, suspended, conditioned, or limited at any time by the Board. The state Department of Revenue has assessed this retroactive tax on the riverboats, without providing an offset for taxes paid at a higher tax rate during that one-month period. In April , the Indiana General Assembly passed legislation that eliminated the license for a county contiguous to Patoka Lake, but authorized the establishment and operation of a riverboat casino in Orange County, Indiana. A licensee, or its parent company, that is publicly traded must notify the Indiana Commission of a public offering that will be registered with the SEC. The Indiana Commission rules require that:. However, no more than six licenses may be granted to riverboats operating from any one designated waterway. The Board is responsible for issuing the gaming license and is empowered to issue up to fifteen licenses to conduct gaming activities on riverboats in accordance with applicable law. Under Mississippi law, gaming vessels must be located on the Mississippi River or on navigable waters in eligible counties along the Mississippi River or in the waters lying south of the counties along the Mississippi Gulf Coast. The exercise of voting privileges with regard to publicly traded securities shall not be deemed to constitute the exercise of influence over the affairs of a licensee. In addition, our Louisiana riverboat gaming vessels are subject to annual license and franchise fees in the amount of The local governing authority of the parish or municipality in which the licensed berth of a riverboat is located may also levy certain admission fees, computed in various ways as provided by the Louisiana Act. Recently the Mississippi Legislature amended the Mississippi Act to permit licensees in the three counties along the Gulf Coast to establish land-based casino operations, provided the gaming areas do not extend more than feet beyond the nineteen-year mean high water line, except in Harrison County where the foot limit can be extended as far as the southern boundary of Highway The Mississippi Act permits unlimited stakes gaming on a hour basis and does not restrict the percentage of space which may be utilized for gaming. We have obtained such approvals from the Mississippi Commission. In June , the Indiana General Assembly authorized riverboats to either continue conducting excursions or to implement a flexible boarding schedule and remain dockside in order to allow patrons to enter the riverboat at any time during operating hours. Sales on a riverboat and at related resort facilities are subject to applicable use, excise and retail taxes. Any holder of debt securities required to apply for a finding of suitability must pay all investigative fees and costs of the Mississippi Commission in connection with such an investigation. A gaming license is deemed to be a pure and absolute revocable privilege under the Louisiana Act, and not a right. In its. In its legislative session, the Indiana General Assembly authorized riverboat casinos to remain open 24 hours per day, seven days a week, with those hours to be set at the election of the riverboat. We may be required to disclose to the Mississippi Commission, upon request, the identities of the holders of any of our debt or other securities. The Indiana Act requires a riverboat owner licensee to directly reimburse the Indiana Commission for the costs of inspectors and agents required to be present while authorized gaming is conducted.

Exhibit The ownership and operation of gaming companies are subject to extensive regulation. An ownership interest in a licensee may only be transferred in accordance with the Indiana Act and rules promulgated thereunder. Belterra and the other riverboat casinos have filed protests with the state, asserting that this interpretation of the legislation is erroneous and should be set aside.

We are currently in compliance with such purchasing goals. Officers, directors and principal owners of the actual license holder and employees who are to work on the riverboat are subject to substantial disclosure requirements as a part of securing and maintaining necessary licenses.

Determination of suitability or questions pertaining to licensing are not subject to judicial review in Mississippi. Any person acquiring a five percent or more ownership interest or economic interest shall be subject to a suitability determination, unless otherwise exempted.

The regulations are gca l auberge casino br to amendment and interpretation by the Mississippi Commission.

No planet 7 casino may become a stockholder of or receive any percentage of profits gca l auberge casino br an Intermediary Company or a Mississippi Gaming Subsidiary of a Mississippi Registered Corporation without first obtaining licenses and approvals from the Mississippi Commission.

Indiana Commission regulations also require a licensee source applicant or affiliate to conduct due diligence to ensure that each person with whom the licensee or applicant or affiliate enters into a debt transaction would be suitable for licensure under the Indiana Act.

Prior to Juneriverboats were required to conduct excursions, which limited the times during which patrons could enter the riverboat. Currently, gaming is permissible in nine of the fourteen eligible counties in the state and gaming operations have commenced in seven counties.

The license will be subject to annual renewal. The Indiana Commission has also promulgated a rule mandating licensees to maintain a cash reserve against defaults in gaming debts.

We click the following article these regulations below.

All contracts are subject to gca l auberge casino br by the Indiana Commission. If it should be determined that the Louisiana Act has been violated by us or any of our Louisiana subsidiaries holding riverboat gaming licenses, the Board could revoke, suspend, limit, or condition the licenses, subject to compliance with certain statutory and regulatory procedures.

Real property taxes gca l auberge casino br imposed on riverboats at rates determined by local taxing authorities. A failure to make such disclosure may be grounds for finding the record holder unsuitable.

The carryover patron calculation is, thus, eliminated with the commencement of dockside operations. The Mississippi Commission has the power to require us and Casino Magic Biloxi to suspend or dismiss officers, gca l auberge casino br and other key employees or sever relationships with other persons who refuse to file appropriate applications or who the authorities find unsuitable to act in such capacities.

We believe that we have obtained or applied for all necessary findings of suitability with respect to such persons associated with us or Casino Magic Biloxi, although the Mississippi Commission in its discretion may require additional persons to file applications for findings of suitability.

Under this legislation, the Indiana Commission is authorized to go here into an operating agreement for up to 20 years with a qualified operator for this facility.

Any record or beneficial stockholder required to apply for a finding of suitability must pay all investigative fees and costs of the Mississippi Commission in connection with such investigation.

For Boomtown New Orleans, the Louisiana Act provides that the admission fee for any riverboat licensed to operate within the unincorporated area of Jefferson Parish on the West Bank of the Mississippi River shall be six percent of weekly net gaming proceeds.

Income to us from Belterra is subject to the Indiana adjusted gross income tax. If a stockholder who must be found suitable is a corporation, partnership or trust, it must submit detailed business not casino night party rentals fresno ca abstract financial information, including a list of beneficial owners.

In July,Belterra began continuous hour gaming each day of gca l auberge casino br week. The Mississippi Act permits substantially all traditional casino games and gaming devices. The Mississippi Act requires that the certificates representing securities of a Mississippi Registered Corporation bear a legend indicating that such securities are subject to the Mississippi Act and the regulations of the Mississippi Commission.

The Indiana Act originally included an eleventh license for a county contiguous to Patoka Lake. Any purchaser or holder of securities that we have offered or issued shall be deemed to have agreed to such provisions.

We have received from the Mississippi Commission a waiver of this legend requirement.

After the expiration of the initial license, the Indiana Commission will conduct a complete re-investigation every three years, but the Indiana Commission reserves the right to investigate licenses at any times it deems necessary. An Indiana license entitles the licensee to own and operate one riverboat. In October , Belterra, the tenth riverboat, commenced operations along the Ohio River. As a Mississippi Registered Corporation, we are required periodically to submit detailed financial and operating reports to the Mississippi Commission and furnish any other information which the Mississippi Commission may require. A riverboat owner licensee may not enter into or perform any contract or transaction in which it transfers or receives consideration which is not commercially reasonable or which does not reflect the fair market value of the goods or services rendered or received. In addition, any person having a material relationship or involvement with us or Casino Magic Biloxi, may be required to be found suitable, in which case those persons must pay the costs and fees associated with such investigation. We must also render maximum assistance in determining the identity of the beneficial owner. A wagering tax of Those riverboats conducting excursions must pay the admissions tax on a passenger per excursion basis which requires payment of the admission tax on carryover patrons. The cash reserve can consist of cash on hand, cash maintained in Indiana bank accounts and cash equivalents not otherwise committed or obligated. To issue a license, the Board must find that the applicant has demonstrated by clear and convincing evidence that such applicant is suitable, which requires submission of detailed personal and financial information followed by a thorough investigation. The Orange County riverboat casino is not expected to begin operations until , at the earliest. As to Boomtown Bossier City, the Louisiana Act establishes that the admission fee for any riverboat located within Bossier City in Bossier Parish shall be four and five-tenths percent of monthly net gaming proceeds. The licensee must notify the Indiana Commission within 10 business days of the initial filing of a registration statement with the SEC.