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Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549



FORM 10-K/AAmendment No. 2



(Mark One)ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended April 25, 2010ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
from                  to


Commission File Number 0-20538

ISLE OF CAPRI CASINOS, INC.(Exact name of registrant as specified in its charter)

Delaware(State or other jurisdiction of
incorporation or organization)

41-1659606(I.R.S. Employer
Identification Number)600 Emerson Road, Suite 300, St. Louis, Missouri(Address of principal executive offices)

63141(Zip Code)


Registrant's
telephone number, including area code:(314) 813-9200



Securities
Registered Pursuant to Section 12(b) of the Act:None

Securities
Registered Pursuant to Section 12(g) of the Act: Common Stock, $.01 Par Value Per Share(Title of Class)



Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes o    No ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes o    No ý

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 90 days. Yes ý    No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to
be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit and post such files).
Yes o    No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o

Accelerated filer ý

Non-accelerated filer o (Do not check if a smaller reporting company)

Smaller reporting company o


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o    No ý

The aggregate market value of the voting and non-voting stock held by non-affiliates(1) of the Company is $157,316,738, based on the last
reported sale price of $9.41 per share on October 26, 2009 on the NASDAQ Stock Market; multiplied by 16,718,038 shares of Common Stock outstanding and held by non-affiliates
of the Company on such date.

As
of June 4, 2010, the Company had a total of 32,445,488 shares of Common Stock outstanding (which excludes 4,326,242 shares held by us in treasury).

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EXPLANATORY NOTE

We are filing this Amendment No. 2 to our Annual Report on Form 10-K for the year ended April 25, 2010
("Amendment"), originally filed with the Securities and Exchange Commission (the "SEC") on June 8, 2010 and amended on June 8, 2010 (the "Original Form 10-K").

The
purpose of this Amendment is to amend the Original Form 10-K to include the information required by Items 10 through 14 of Part III of
Form 10-K, which information was previously omitted from the Original Form 10-K in reliance on General Instruction G(3) to Form 10-K.
The reference on the cover of the Original Form 10-K to the incorporation by reference to portions of our definitive proxy statement into Part III of the Original
Form 10-K is hereby deleted. Additionally, in Item 8, Note 2 to the consolidated financial statements, the following language in theSubsequent
Eventssection "No material subsequent events have occurred that require recognition or disclosure in the consolidated financial statements" has been replaced with a reference
to a new Note 21, which addresses the completion of our acquisition of the Rainbow Casino located in Vicksburg, Mississippi. Other than described in the preceding sentence, the financial
statements have not been revised.

Pursuant
to the rules of the SEC, Item 15 of Part IV has also been amended to contain the currently dated certifications from the Company's Principal Executive Officer and
Principal Financial Officer as required by Section 302 and 906 of the Sarbanes Oxley Act of 2002. The certifications of the Company's Principal Executive Officer and Principal Financial Officer
are attached to this Amendment as Exhibits 31 and 32.

For
the convenience of the reader, this Amendment sets forth the Original Form 10-K, in its entirety, as modified and superseded where necessary to reflect the
amendments discussed above. The following items have been amended to include the required Part III information and to update subsequent events:



The
remaining Items contained within this Amendment consist of all other Items contained in the Original Form 10-K and are included for the convenience of the reader.
The sections of the Original Form 10-K which were not amended are unchanged and continue in full force and effect as originally filed. Other than as required to reflect the changes
discussed above, the
Original Form 10-K continues to speak as of the date thereof (or such other date as may be referred to in the Original Form 10-K). Events occurring subsequent to
the filing of the Original Form 10-K and disclosures necessary to reflect any subsequent events have been or will be addressed in our filings with the SEC for periods subsequent to
the periods covered by the Original Form 10-K.

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ISLE OF CAPRI CASINOS, INC.        FORM 10-K        INDEX



PAGEPART I


2ITEM 1.

BUSINESS


2ITEM 1A.

RISK FACTORS


10ITEM 1B.

UNRESOLVED STAFF COMMENTS


19ITEM 2.

PROPERTIES


19ITEM 3.

LEGAL PROCEEDINGS


22ITEM 4.

[REMOVED AND RESERVED]


23PART II


23ITEM 5.

MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES


23ITEM 6.

SELECTED FINANCIAL DATA


25ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


26ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


42ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


44ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE


85ITEM 9A.

CONTROLS AND PROCEDURES


85ITEM 9B.

OTHER INFORMATION


85PART III


86ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE


86ITEM 11.

EXECUTIVE COMPENSATION


91ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS


108ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR INDEPENCENCE


112ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES


113PART IV


114ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES


114SIGNATURES


115


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Table of Contents

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report contains statements that we believe are, or may be considered to be, "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this Annual Report regarding the prospects
of our industry or our prospects, plans, financial position or business strategy, may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the
use of forward-looking words such as "may," "will," "expect," "intend," "estimate," "foresee," "project," "anticipate," "believe," "plans," "forecasts," "continue" or "could" or the negatives of these
terms or variations of them or similar terms. Furthermore, such forward-looking statements may be included in various filings that we make with the SEC or press releases or oral statements made by or
with the approval of one of our authorized executive officers. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that these
expectations will prove to be correct. These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to
differ materially from those reflected in these forward-looking statements. Factors that might cause actual results to differ include, but are not limited to, those discussed in the section entitled
"Risk Factors" beginning on page 10 of this report. Readers are cautioned not to place undue reliance on any forward-looking statements contained herein, which reflect management's opinions
only as of the date hereof. Except as required by law, we undertake no obligation to revise or publicly release the results of any revision to any forward-looking statements. You are advised, however,
to consult any additional disclosures we make in our reports to the SEC. All subsequent written
and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this Annual
Report.

1

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Table of Contents

PART I

ITEM 1.    BUSINESS

Overview

We are a leading developer, owner and operator of branded gaming facilities and related lodging and entertainment facilities in
regional markets in the United States. We own and operate 14 casino properties in six states. Collectively, these properties feature over 14,500 slot machines and over 350 table games
(including approximately 95 poker tables) over 3,000 hotel rooms and more than three dozen restaurants. We also operate a harness racing track at our casino in Florida. We have sought and established
geographic diversity to limit the risks caused by weather, regional economic difficulties, gaming tax rates and regulations of local gaming authorities.

Our
business approach is anchored by a disciplined application of the following strategies:

Focusing on core operating principles that have proven successful.

Our
operating focus is to deliver a superior guest experience by providing customers with the most popular gaming product in a clean, safe, friendly and fun environment. These areas have
been shown through customer research to embody the attributes of a gaming entertainment experience most important to our customers in choosing which casino to visit. We emphasize, among other things,
customer courtesy and we have implemented a proprietary program to measure our progress against standards for certain courtesy behaviors. In addition, many of our capital and operating plans are
intended to improve on guest satisfaction, including quality, accessibility and cleanliness of areas frequented by our customers, such as hotel rooms and other public areas in our hotels and casino
floors. We also have implemented employee incentive programs designed to encourage employees to deliver superior customer service and courtesy.

Driving value through product offerings and branding.

Our
current strategy is to evolve into operating our properties under only two separate brand names: Isle and Lady Luck (which we re-launched in fiscal 2009). We use the Isle
brand primarily at properties that have a regional draw. These are generally casinos in larger markets where we have expansion potential demonstrated by either the size of the market or excess land
that we control. The Isle-branded properties typically offer expanded amenities, such as hotel rooms, expanded food and beverage offerings and conference and convention capabilities.

We
use the Lady Luck brand on properties that predominantly draw local customers, which are typically in smaller markets with less expansion potential. The goal of the Lady Luck brand is
to offer high quality entertainment options, featuring casual dining and popular local entertainment in a comfortable setting in addition to a first class gaming experience. We have completed the
refurbishment and rebranding of three of our existing Isle properties under the Lady Luck brand: Marquette, Iowa in September 2009, Colorado Central Station in Black Hawk, Colorado in June 2009 and
Caruthersville,
Missouri in December 2008. We intend to rebrand some of our other existing properties under the Lady Luck name during the next few years as economic conditions and our capital structure improve. Our
current expectations are that Natchez and Lula, Mississippi; Lake Charles, Louisiana; Boonville, and Kansas City, Missouri; and Davenport, Iowa will eventually be rebranded to Lady Luck casinos.

Continuing to focus on financial discipline.

We
have made efforts to reduce our debt levels. During the last 24 months, we have reduced our outstanding debt from approximately $1.5 billion as of April 27, 2008 to
$1.2 billion or a reduction of approximately $300 million. We achieved this reduction through the use of cash obtained from the settlement of our Hurricane Katrina claim and cash flows
from operations, to retire $142.7 million of the 7% senior subordinated notes for $82.8 million through a tender offer, in February 2009 and a prepayment of $35 million of our
term loans under our senior secured credit facility in March 2009. In addition, we recently entered into an amendment to our senior secured credit facility that permits

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Table of Contents

increased
flexibility in operations and capital spending. We continually seek opportunities to improve our capital structure.

Aggressively pursuing prudent growth opportunities.

We
intend to continue to expand our operations through acquisitions, such as our recently announced agreement to acquire the Rainbow Casino located in Vicksburg, Mississippi, and through
management of casinos owned by third parties. The Mississippi Gaming Commission recently approved our acquisition of the Rainbow Casino and we plan to complete the $80 million acquisition in
June 2010.

We
formed Isle Gaming Management, a management and consulting division of the Company, in 2009 to leverage our experienced and respected management team and intellectual property assets
by managing and operating casinos owned by third parties in exchange for management and other fees. The goal of Isle Gaming Management is to allow us to manage additional casino properties without
requiring extensive capital investment. In January 2010, we entered into a management agreement with Nemacolin Woodlands Resort. Nemacolin is located in southwestern Pennsylvania near the West
Virginia border, approximately 40 miles northeast of Morgantown, West Virginia and approximately 60 miles southeast of Pittsburgh, Pennsylvania. Nemacolin has filed an application with the
Pennsylvania Gaming Control Board for the one remaining resort casino license in Pennsylvania. Nemacolin is one of four applicants. We have also filed an application to be licensed as a casino
operator in Pennsylvania. If Nemacolin is awarded the license and we are granted an operator's license, we have agreed to make certain improvements to an existing building at the resort, which will
house a Lady Luck casino that we will manage. We will pay an annual fee to the casino owner and in return will receive a management fee equal to the EBITDA of the casino after payment of the fee to
Nemacolin. The Pennsylvania Gaming Commission has not set a timeline for the award of the remaining casino license. We are actively seeking other opportunities to manage casinos owned by third
parties.

Casino Properties

The following is an overview of our existing casino properties as of April 25, 2010:

Property

Date Acquired or
Opened

Slot
Machines

Table
Games

Hotel
Rooms

Parking
SpacesLouisianaLake Charles

July 1995


1,840


75


493


2,335MississippiLula

March 2000


1,215


17


484


1,583Biloxi

August 1992


1,292


36


710


1,600Natchez

March 2000


619


10


141


908MissouriKansas City

June 2000


1,201


22





1,618Boonville

December 2001


981


19


140


1,101Caruthersville

June 2007


619


16





1,000IowaBettendorf

March 2000


1,010


31


514


1,597Rhythm City-Davenport

October 2000


954


16





911Marquette

March 2000


600


13





475Waterloo

June 2007


1,040


32


195


1,487ColoradoIsle Casino HotelBlack Hawk

December 1998


1,164


23


238


1,100Lady Luck CasinoBlack Hawk

April 2003


581


20


164


1,200FloridaPompano Park

July 1995/April 2007


1,463


38





3,78114,579


368


3,079


20,696


3

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Louisiana

Lake Charles

Our Lake Charles property, which commenced operations in July 1995, is located on a 19-acre site along Interstate 10, the
main thoroughfare connecting Houston, Texas to Lake Charles, Louisiana. The property consists of two dockside casinos offering 1,840 slot machines, 47 table games, 28 poker tables, two hotels offering
493 rooms, a 105,000 square foot land-based pavilion and entertainment center, and 2,335 parking spaces, including approximately 1,400 spaces in an attached parking garage. The pavilion
and entertainment center offer customers a wide variety of non-gaming amenities, including a 97-seat
Farraddays' restaurant, a 360-seat Calypso's buffet, a 165-seat Tradewinds Marketplace, a 64-seat Lucky Wins Asian-inspired restaurant and Caribbean Cove, which
features free live entertainment and can accommodate 180 customers. The pavilion also has a 14,750 square foot entertainment center comprised of a 1,100-seat special events center designed
for concerts, live boxing, televised pay-per-view events, banquets and other events, meeting facilities and administrative offices.

The
Lake Charles market currently consists of two dockside gaming facilities, a Native American casino and a pari-mutuel facility/racino. The current number of slot machines
in the market exceeds 8,200 machines and table games exceed 200 tables. In calendar year 2009, the two gaming facilities and one racino, in the aggregate, generated gaming revenues of approximately
$665 million. Revenues for the Native American property are not published. Gaming revenues for our Lake Charles property for calendar year 2009 were approximately $149 million. Lake
Charles is the closest gaming market to the Houston metropolitan area, which has a population of approximately 5.5 million and is located approximately 140 miles west of Lake Charles. We
believe that our Lake Charles property attracts customers primarily from southeast Texas, including Houston, Beaumont, Galveston, Orange and Port Arthur and from local area residents. Approximately
500,000 and 1.6 million people reside within 50 and 100 miles, respectively, of the Lake Charles property.

Mississippi

Lula

Our Lula property, which we acquired in March 2000, is strategically located off of Highway 49, the only road crossing the Mississippi
River between Mississippi and Arkansas for more than 50 miles in either direction. The property consists of two dockside casinos containing 1,215 slot machines and 17 table games, two
on-site hotels with a total of 484 rooms, a land-based pavilion and entertainment center, 1,583 parking spaces, and a 28-space RV Park. The pavilion and
entertainment center offer a wide variety of non-gaming amenities, including a 145-seat Farraddays' restaurant, a 300-seat Calypso's buffet and a
44-seat Tradewinds Marketplace, and a gift shop. All 171 rooms of our Coral Reef Hotel underwent complete renovation in 2008.

Our
Lula property is the only gaming facility in Coahoma County, Mississippi and generated gaming revenues of approximately $73 million in calendar year 2009. Lula draws a
significant amount of business from the Little Rock, Arkansas metropolitan area, which has a population of approximately 675,000 and is located approximately 120 miles west of the property. Coahoma
County is also located
approximately 60 miles southwest of Memphis, Tennessee, which is primarily served by nine casinos in Tunica County, Mississippi. Approximately 1.1 million people reside within 60 miles of the
property. Lula also competes with Native American casinos in Oklahoma and a racino in West Memphis, Arkansas.

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Biloxi

Our Biloxi property, which commenced operations in August 1992, is located on a 17-acre site at the eastern end of a
cluster of facilities formerly known as "Casino Row" in Biloxi, Mississippi, and is the first property reached by visitors coming from Alabama, Florida and Georgia via Highway 90.

In
October 2005, the Mississippi legislature amended its gaming laws to allow casinos to operate land-based facilities within 800 feet of the mean high water line. Our Biloxi
property is now a land-based casino offering approximately 1,300 slot machines, 27 table games, a nine-table poker room, a 710-room hotel including 200 whirlpool
suites, a 120-seat banquet room called "Paradise Room," 138-seat Farraddays' restaurant, a 200-seat Calypso's buffet, a Tradewinds Express, a multi-story feature
bar, a full service Starbucks and 1,600 parking spaces.

The
Mississippi Gulf Coast market (which includes Biloxi, Gulfport and Bay St. Louis) is one of the largest gaming markets in the United States and consists of 11 dockside gaming
facilities, which in the aggregate, generated gaming revenues of approximately $1.1 billion during calendar year 2009. Our Biloxi property generated gaming revenues of approximately
$73 million during calendar year 2009. Approximately one million people reside within 60 miles of the property.

Natchez

Our Natchez property, which we acquired in March 2000, is located off of Highways 84 and 61 in western Mississippi. The property
consists of a dockside casino offering 619 slot machines and 10 table games, a 141-room off-site hotel located
approximately one mile from the casino, a 150-seat Calypso's buffet and 908 parking spaces.

Our
Natchez property is currently the only gaming facility in the Natchez market and generated total gaming revenues of approximately $36 million in calendar year 2009. We believe
that the Natchez property attracts customers primarily from among the approximately 351,000 people residing within 60 miles of the Natchez property.

Missouri

Kansas City

Our Kansas City property, which we acquired in June 2000, is the closest gaming facility to downtown Kansas City and consists of a
dockside casino offering 1,201 slot machines and 22 table games, a 260-seat Calypso's buffet, a 45-seat Tradewinds Marketplace and 1,618 parking spaces.

The
Kansas City market consists of four dockside gaming facilities and a Native American casino. Operating statistics for the Native American casino are not published. The four dockside
gaming facilities generated gaming revenues of approximately $720 million in calendar year 2009. Our Kansas City property generated gaming revenues of approximately $82 million during
calendar year 2009. We believe that our Kansas City casino attracts customers primarily from the Kansas City metropolitan area, which has approximately 1.9 million residents

On
April 30, 2010, a ground-breaking ceremony was held to signify the beginning of construction of a $521 million casino at the Kansas Speedway located in Wyandotte County,
Kansas. This casino could open in early 2012. In the fourth quarter of fiscal 2008 the State of Missouri, began reconstruction of the Paseo Bridge and interchanges adjacent to our property. The bridge
and interchange construction is expected to continue into fiscal 2011. Access to our property has been and will continue to be hampered due to lane restrictions related to bridge construction and
temporary entrance/exit ramp designs until the construction is completed.

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Boonville

Our Boonville property, which opened on December 6, 2001, is located three miles off Interstate 70, approximately halfway
between Kansas City and St. Louis. The property consists of a single level dockside casino offering 981 slot machines, 19 table games, a 140-room hotel, a 32,400 square foot
pavilion and entertainment center and 1,101 parking spaces. The pavilion and entertainment center offers customers a wide variety of non-gaming amenities, including an 83-seat
Farraddays' restaurant, a 218-seat Calypso's buffet, a 24-seat Tradewinds Marketplace, an 800 seat event center, and an historic display area. Our Boonville property is the
only gaming facility in central Missouri and generated gaming revenues of approximately $82 million in calendar year 2009. We believe that our Boonville casino attracts customers primarily from
the approximately 583,000 people who reside within 60 miles of the property which includes the Columbia and Jefferson City areas.

Caruthersville

Our Caruthersville property was acquired on June 11, 2007 and is a riverboat casino located along the Mississippi River in
Southeast Missouri. In June 2008, the casino was re-branded as a Lady Luck casino with the construction and refurbishment completed in December 2008. The dockside casino offers 619 slot
machines, 11 table games and 5 poker tables. As part of the re-branding, we renovated our 40,000 square foot pavilion, which includes a 130-seat Lone Wolf restaurant, bar and
lounge, and a 270-seat Otis & Henry's restaurant. Renovations to the riverboat, including the casino floor, were completed in the summer of 2009. The property also operates a 10,000
square foot exposition center with seating for up to 1,100 patrons and has 1,000 parking spaces. Our Caruthersville facility is the only casino located in Southeast Missouri and generated gaming
revenues of approximately $33 million in calendar year 2009. Approximately 647,000 people reside within 60 miles of the property.

Recent Changes to Missouri Gaming LawsDuring November 2008, gaming law changes became effective in Missouri which repealed the $500 loss limit.

Iowa

Bettendorf

The Bettendorf property, which we acquired in March 2000, is located off of Interstate 74, an interstate highway serving the Quad
Cities metropolitan area, which consists of Bettendorf and Davenport, Iowa and Moline and Rock Island, Illinois. The property consists of a dockside casino offering 1,010 slot machines and 31 table
games, 514 hotel rooms, 40,000 square feet of flexible convention/banquet space, a 102-seat Farraddays' restaurant, a 272-seat Calypso's buffet, a 26-seat
Tradewinds Marketplace and 1,597 parking spaces. We have entered into agreements with the City of Bettendorf, Iowa under which we manage and provide financial and operating support for the QC
Waterfront Convention Center that is adjacent to our hotel. The QC Waterfront Convention Center opened in January 2009.

Davenport

Our Davenport property, which we acquired in October 2000, is located at the intersection of River Drive and Highway 61, a state
highway serving the Quad Cities metropolitan area. The property consists of a dockside gaming facility offering 954 slot machines, 16 table games, a 228-seat Hit Parade buffet, a
Grab-n-Go food outlet and 911 parking spaces.

The
Quad Cities metropolitan area currently has three gaming operationsour two gaming facilities in Bettendorf and in Davenport, and one operator, which opened a larger
land-based facility, including a hotel, in December 2008. The three operations in the Quad Cities generated total gaming revenues of approximately $210 million in calendar year
2009. Our Bettendorf and Davenport

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properties
generated casino revenues for calendar year 2009 of approximately $82 million and $55 million, respectively. Our operations in the Quad Cities also compete with other gaming
operations
in Illinois and Iowa. Approximately 923,000 people reside within 60 miles of our Bettendorf and Davenport properties.

Marquette

Our Marquette property, which we acquired in March 2000, is located in Marquette, Iowa, approximately 60 miles north of Dubuque, Iowa.
The property consists of a dockside casino offering 600 slot machines and 13 table games, a marina and 475 parking spaces. During fiscal 2010, we completed the rebranding of the property as a Lady
Luck casino. The facility now includes a newly themed 158-seat buffet restaurant, an Otis and Henry's Express food outlet and a Lone Wolf restaurant and bar.

Our
Marquette property is the only gaming facility in the Marquette, Iowa market and generated gaming revenues of approximately $30 million in calendar year 2009. We believe most
of our Marquette customers are from northeast Iowa and Wisconsin, which includes approximately 491,000 people within 60 miles of our property, and we compete for those customers with other gaming
facilities in Dubuque, Iowa and Native American casinos in southwestern Wisconsin.

Waterloo

Our Waterloo property, which opened on June 30, 2007, is located adjacent to Highway 218 and US 20 in Waterloo, Iowa. The
property consists of a single-level casino offering 1,040 slot machines, 27 table games and 5 poker tables. The property also offers a wide variety of non-gaming amenities,
including a 123-seat Otis & Henry's restaurant, a 208-seat Isle buffet, a 36-seat Tradewinds marketplace, Club Capri Lounge, Fling feature bar, 5,000 square
feet of meeting space, over 1,487 parking spaces and a 195-room hotel, which includes 27 suites, as well as an indoor pool and hot tub area.

Our
Waterloo property is the only gaming facility in the Waterloo, Iowa market and approximately 636,000 people live within 60 miles of the property. We compete with other casinos in
eastern Iowa. We generated gaming revenues of approximately $78 million in calendar year 2009.

Colorado

Isle Casino Hotel-Black Hawk

Isle Casino Hotel-Black Hawk commenced operations in December 1998, is located on an approximately 10-acre site and is one
of the first gaming facilities reached by customers arriving from Denver via Highway 119, the main thoroughfare connecting Denver to Black Hawk. The property includes a land-based casino
with 1,164 slot machines and 23 table games, a 238-room hotel and 1,100 parking spaces in an attached parking garage. Isle Casino Hotel-Black Hawk also offers customers three
restaurants, including a 114-seat Farraddays' restaurant, a 271-seat Calypso's buffet and a 36-seat Tradewinds Marketplace.

Lady Luck Casino-Black Hawk

Lady Luck Casino-Black Hawk, which we acquired in April 2003 and rebranded in June 2009, is located across the intersection of Main
Street and Mill Street from the Isle Casino Hotel-Black Hawk. The property consists of a land-based casino with 581 slot machines, 11 standard table games, a nine table poker
room, a 164-room hotel that opened in December 2005 and 1,200 parking spaces in our parking structure connecting Isle Casino Hotel-Black Hawk and Lady Luck Casino-Black Hawk. The property
also offers guests dining in its 94-seat Station Café that was opened in early 2007 as well as a grab and go fast serve food counter that is located in the lower level of the facility.
Our Black Hawk sites are connected via sky bridges.

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When casinos having multiple gaming licenses in the same building are combined, the Black Hawk/Central City market consists of 24 gaming facilities (seven of
which have more than 600 slot machines), which in aggregate, generated gaming revenues of approximately $595 million in calendar year 2009. Our Black Hawk properties generated casino revenues
for calendar year 2009 of approximately $132 million. Black Hawk is the closest gaming market to the Denver, Colorado metropolitan area, which has a population of approximately
2.9 million and is located approximately 40 miles east of Black Hawk and serves as the primary feeder market for Black Hawk.

Recent Changes to Colorado Gaming LawsOn July 2, 2009, changes to the Colorado gaming law went into effect which extended the hours of
operation from 18 to 24 hours per day, expanded the types of permitted table games to include craps and roulette, and increased the betting limits from $5 to $100 per bet.

Florida

Pompano

In 1995, we acquired Pompano Park, a harness racing track located in Pompano Beach, Florida. Pompano Park is located off of Interstate
95 and the Florida Turnpike on a 223-acre owned site, near Fort Lauderdale, midway between Miami and West Palm Beach. Pompano Park is the only racetrack licensed to conduct harness racing
in Florida.

Our
Pompano facility includes 1,463 slot machines, a 38-table poker room, three restaurants, a feature bar and 3,781 parking spaces.

Approximately
2.6 million people reside within a 25-mile radius of our Pompano facility, which competes with four other racinos and three Native American facilities in
the market. While casino revenues are not available for all market competitors, we estimate that we operate approximately 12% of the slot machines in the market and generated approximately
$121 million in casino revenues for calendar year 2009.

Recent Changes to Florida Gaming LawsIn April 2010, changes were made to Florida law which, among other things, lowered our state gaming tax rate
from 50% to 35% effective July 1, 2010. This legislation also allows the poker operations to remain open for the same hours as the slot floor and removes the poker betting limits. The changes
to Florida law were combined with the approval of a gaming compact between the State of Florida and the Seminole Tribe of Florida. This gaming compact allows the tribe the exclusive right outside of
Miami-Dade and Broward counties to operate slot machines and other similar electronic gaming devices and the right to operate live blackjack and baccarat table games for a period of five
years at certain tribal gaming locations.

International Operations

LucayaWe operated a casino in Grand Bahama from December 2003 through November 2009, when we exited the operation.

Blue ChipWe operated casinos in Dudley and Wolverhampton, England. These casinos opened during fiscal 2004 and were operated by us until they were
sold in November 2009.

CoventryWe operated a casino in the Coventry Convention Center from July 2007 through April 2009, when we terminated our lease and sold the casino
and related assets.

Marketing

Our marketing programs are designed to promote our overall business strategy of providing customers with a safe, clean, friendly and
fun gaming experience at each of our properties. We have

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developed
an extensive proprietary database of customers that allows us to create effective targeted marketing and promotional programs that are designed to reward customer loyalty, attract new
customers to our properties and maintain high recognition of our brands.

Specifically,
our marketing programs and initiatives are tailored to support this corporate strategic plan and are generally focused on the following areas:



Employees

As of April 25, 2010, we employed approximately 7,500 people. We have a collective bargaining agreement with UNITE HERE covering
approximately 375 employees at our
Pompano property which expires in May 2012. We believe that our relationship with our employees is satisfactory.

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Governmental Regulations

The gaming and racing industries are highly regulated, and we must maintain our licenses and pay gaming taxes to continue our
operations. Each of our facilities is subject to extensive regulation under the laws, rules and regulations of the jurisdiction where it is located. These laws, rules and regulations generally relate
to the responsibility, financial stability and character of the owners, managers and persons with financial interests in the gaming operations. Violations of laws in one jurisdiction could result in
disciplinary action in other jurisdictions. A more detailed description of the regulations to which we are subject is contained in Exhibit 99.1 to this Annual Report on
Form 10-K.

Our
businesses are subject to various federal, state and local laws and regulations in addition to gaming regulations. These laws and regulations include, but are not limited to,
restrictions and conditions concerning alcoholic beverages, food service, smoking, environmental matters, employees and employment practices, currency transactions, taxation, zoning and building
codes, and marketing and advertising. Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Material changes, new laws
or regulations, or material differences in interpretations by courts or governmental authorities could adversely affect our operating results.

Available Information

For more information about us, visit our web site at www.isleofcapricasinos.com. Our electronic filings with the U.S. Securities and
Exchange Commission (including all annual reports on Form 10-K, quarter reports on Form 10-Q, and current reports on Form 8-K, and any
amendments to these reports), including the exhibits, are available free of charge through our web site as soon as reasonably practicable after we electronically file them with or furnish them to the
U.S. Securities and Exchange Commission.

ITEM 1A.    RISK FACTORS

We face significant competition from other gaming operations, including Native American gaming facilities, that could have a material adverse effect on our future
operations.

The gaming industry is intensely competitive, and we face a high degree of competition in the markets in which we operate. We have
numerous competitors, including land-based casinos, dockside casinos, riverboat casinos, casinos located on racing, pari-mutuel operations or Native American-owned lands and
video lottery and poker machines not located in casinos. Some of our competitors may have better name recognition, marketing and financial resources than we do; competitors with more financial
resources may therefore be able to improve the quality of, or expand, their gaming facilities in a way that we may be unable to match.

Legalized
gaming is currently permitted in various forms throughout the United States. Certain states have recently legalized, and other states are currently considering legalizing
gaming. Our existing gaming facilities compete directly with other gaming properties in the states in which we operate. Our existing casinos attract a significant number of their customers from
Houston, Texas; Mobile, Alabama; Kansas City, Kansas; Southern Florida; Little Rock, Arkansas; and Denver, Colorado. Legalization of gaming in jurisdictions closer to these geographic markets other
than the jurisdictions in which our facilities are located would have a material adverse effect on our operating results. Other jurisdictions, including states in close proximity to jurisdictions
where we currently have operations, have considered and may consider legalizing casino gaming and other forms of competition. In addition, there is no limit on the number of gaming licenses that may
be granted in several of the markets in which we operate. As a result, new gaming licenses could be awarded in these markets, which could allow new gaming operators to enter our markets that could
have an adverse effect on our operating results.

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We
also compete with other forms of legalized gaming and entertainment such as online computer gambling, bingo, pull tab games, card parlors, sports books,
"cruise-to-nowhere" operations, pari-mutuel or telephonic betting on horse racing and dog racing, state-sponsored lotteries, jai-alai, and, in the
future, may compete with gaming at other venues. In addition, we compete more generally with other forms of entertainment for the discretionary spending of our customers.

Our
continued success depends upon drawing customers from each of these geographic markets. We expect competition to increase as new gaming operators enter our markets, existing
competitors expand their operations, gaming activities expand in existing jurisdictions and gaming is legalized in new jurisdictions. We cannot predict with any certainty the effects of existing and
future competition on our operating results.

We are subject to extensive regulation from gaming and other regulatory authorities that could adversely affect us.

Licensing requirements.As owners and operators of gaming and pari-mutuel wagering facilities, we are subject to extensive state and
local regulation. State and local authorities require us and our subsidiaries to demonstrate suitability to obtain and retain various licenses and require that we have registrations, permits and
approvals to conduct gaming operations. The regulatory authorities in the jurisdictions in which we operate have very broad discretion with regard to their regulation of gaming operators, and may for
a broad variety of reasons and in accordance with applicable laws, rules and regulations, limit, condition, suspend, fail to renew or revoke a license to conduct gaming operations or prevent us from
owning the securities of any of our gaming subsidiaries, or prevent other persons from owning an interest in us or doing business with us. We may also be deemed responsible for the acts and conduct of
our employees. Substantial fines or forfeiture of assets for violations of gaming laws or regulations may be levied against us, our subsidiaries and the persons involved, and some regulatory
authorities have the ability to require us to suspend our operations. The suspension or revocation of any of our licenses or our operations or the levy on us or our subsidiaries of a substantial fine
would have a material adverse effect on our business.

To
date, we have demonstrated suitability to obtain and have obtained all governmental licenses, registrations, permits and approvals necessary for us to operate our existing gaming
facilities. We cannot assure you that we will be able to retain these licenses, registrations, permits and approvals or that we will be able to obtain any new ones in order to expand our business, or
that our attempts to do so will be timely. Like all gaming operators in the jurisdictions in which we operate, we must periodically apply to renew our gaming licenses and have the suitability of
certain of our directors, officers and employees approved. We cannot assure you that we will be able to obtain such renewals or approvals.

In
addition, regulatory authorities in certain jurisdictions must approve, in advance, any restrictions on transfers of, agreements not to encumber or pledges of equity securities issued
by a corporation that is
registered as an intermediary company with such state, or that holds a gaming license. If these restrictions are not approved in advance, they will be invalid.

Compliance with other laws.We are also subject to a variety of other federal, state and local laws, rules, regulations and ordinances
that apply to
non-gaming businesses, including zoning, environmental, construction and land-use laws and regulations governing the serving of alcoholic beverages. Under various federal,
state and local laws and regulations, an owner or operator of real property may be held liable for the costs of removal or remediation of certain hazardous or toxic substances or wastes located on its
property, regardless of whether or not the present owner or operator knows of, or is responsible for, the presence of such substances or wastes. We have not identified any issues associated with our
properties that could reasonably be expected to have an adverse effect on us or the results of our operations. However, several of our properties are located in industrial areas or were used for

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industrial
purposes for many years. As a consequence, it is possible that historical or neighboring activities have affected one or more of our properties and that, as a result, environmental issues
could arise in the future, the precise nature of which we cannot now predict. The coverage and attendant compliance costs associated with these laws, regulations and ordinances may result in future
additional costs.

Regulations
adopted by the Financial Crimes Enforcement Network of the U.S. Treasury Department require us to report currency transactions in excess of $10,000 occurring within a gaming
day, including identification of the patron by name and social security number. U.S. Treasury Department regulations also require us to report certain suspicious activity, including any transaction
that exceeds $5,000 if we know, suspect or have reason to believe that the transaction involves funds from illegal activity or is designed to evade federal regulations or reporting requirements.
Substantial penalties can be imposed against us if we fail to comply with these regulations.

Several
of our riverboats must comply with U.S. Coast Guard requirements as to boat design, on-board facilities, equipment, personnel and safety and must hold U.S. Coast
Guard Certificates of Documentation and Inspection. The U.S. Coast Guard requirements also set limits on the operation of the riverboats and mandate licensing of certain personnel involved with the
operation of the riverboats. Loss of a riverboat's Certificate of Documentation and Inspection could preclude its use as a riverboat casino. The U.S. Coast Guard has shifted inspection duties related
to permanently moored casino vessels to the individual states. Louisiana and Missouri have elected to utilize the services of the American Bureau of Shipping ("ABS") to undertake the inspections. Iowa
has elected to handle the inspections through the Iowa Department of Natural Resources. The states will continue the same inspection criteria as the U.S. Coast Guard in regard to annual and five year
inspections. Depending on the outcome of these inspections a vessel could become subject to dry-docking for inspection of its hull, which could result in a temporary loss of service.

We
are required to have third parties periodically inspect and certify all of our casino barges for stability and single compartment flooding integrity. Our casino barges and other
facilities must also meet local fire safety standards. We would incur additional costs if any of our gaming facilities were not in compliance with one or more of these regulations.

Potential changes in legislation and regulation of our operations.From time to time, legislators and special interest groups have
proposed
legislation that would expand, restrict or prevent gaming operations in the jurisdictions in which we operate. In addition, from time to time, certain anti-gaming groups have challenged
constitutional amendments or legislation that would limit our ability to continue to operate in those jurisdictions in which these constitutional amendments or legislation have been adopted.

Taxation and fees.State and local authorities raise a significant amount of revenue through taxes and fees on gaming activities. We
believe that the
prospect of significant revenue is one of the primary reasons that jurisdictions permit legalized gaming. As a result, gaming companies are typically subject to significant taxes and fees in addition
to normal federal, state, local and provincial income taxes, and such taxes and fees are subject to increase at any time. We pay substantial taxes and fees with respect to our operations. From time to
time, federal, state, local and provincial legislators and officials have proposed changes in tax laws, or in the administration of such laws, affecting the gaming industry. Any material increase, or
the adoption of additional taxes or fees, could have a material adverse effect on our future financial results.

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Our business may be adversely affected by legislation prohibiting tobacco smoking.

Legislation in various forms to ban indoor tobacco smoking has recently been enacted or introduced in many states and local
jurisdictions, including several of the jurisdictions in which we operate. On January 1, 2008, a statewide smoking ban that includes casino floors went into effect in Colorado. This smoking ban
in Colorado has had a negative impact on business volume at our Black Hawk properties.

If
additional restrictions on smoking are enacted in jurisdictions in which we operate, we could experience a significant decrease in gaming revenue and particularly, if such
restrictions are not applicable to all competitive facilities in that gaming market, our business could be materially adversely affected.

Our substantial indebtedness could adversely affect our financial health and restrict our operations.

We have a significant amount of indebtedness. As of April 25, 2010, we had approximately $1.2 billion of total debt
outstanding.

Our
significant indebtedness could have important consequences to our financial health, such as:



A
substantial portion of our outstanding debt bears interest at variable rates, although we have entered into interest rate protection agreements expiring through fiscal 2014 with
counterparty banks

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with
respect to $420 million of our term loans under our senior secured credit facility. If short-term interest rates rise, our interest cost will increase on the unhedged portion
of our variable rate indebtedness, which will adversely affect our results of operations and available cash.

Any
of the factors listed above could have a material adverse effect on our business, financial condition and results of operations. We cannot assure you that our business will continue
to generate sufficient cash flow, or that future available draws under our senior secured credit facility will be sufficient, to enable us to meet our liquidity needs, including those needed to
service our indebtedness.

Despite our significant indebtedness, we may still be able to incur significantly more debt. This could intensify the risks described above.

The terms of the indenture and agreements governing our senior secured credit facility, our 7% senior subordinated notes and our other
indebtedness limit, but do not prohibit, us or our subsidiaries from incurring significant additional indebtedness in the future.

As
of April 25, 2010, we had the capacity to incur additional indebtedness, including the ability to incur additional indebtedness under all of our lines of credit, of
approximately $109 million. Approximately $20 million of these lines of credit were used to support letters of credit. Our capacity to issue additional indebtedness is subject to the
limitations imposed by the covenants in our senior secured credit facility and the indenture governing our 7% senior subordinated notes. The indenture governing our 7% senior subordinated notes and
our senior secured credit facility contain financial and other restrictive covenants, but will not fully prohibit us from incurring additional debt. If new debt is added to our current level of
indebtedness, the related risks that we now face could intensify.

We may not be able to renew or extend our senior secured credit facility or enter into a new credit facility in today's difficult markets. In addition, our ability to renew
or extend our senior secured credit facility or to enter into a new credit facility may be impaired further if market conditions worsen. If we are able to renew or extend our senior secured credit
facility, it may be on terms substantially less favorable than the current senior secured credit facility. We may face similar risks with respect to our outstanding bonds.

Disruptions in the global markets have led to a scarcity of credit, tighter lending standards and higher interest rates on consumer and
business loans. On February 17, 2010, in order to allow us to issue senior unsecured notes and to temporarily modify the leverage ratio and interest coverage ratio to provide for greater
flexibility through April 30, 2012, we entered into an amendment to our $1.35 billion senior secured credit facility, which, among other things, reduced the capacity of the revolving
line of credit by $100 million to $375 million and increased the interest rate of both the revolving line of credit and term loan portions to LIBOR + 3.00% with a LIBOR
floor of 2.00%. As of April 25, 2010, we had approximately $817 million in term loans and approximately $21 million drawn on the revolving line of credit. The availability under
our revolving line of credit as of April 25, 2010 was approximately $109 million, after consideration of approximately $20 million in outstanding letters of credit. Our ability to
renew or extend our existing senior secured credit facility or to enter into a new credit facility to replace the existing senior secured credit facility could be impaired if market conditions worsen.

In
the current environment, lenders may seek more restrictive lending provisions and higher interest rates that may reduce our borrowing capacity and increase our costs. We can make no
assurances that we will be able to enter into a new credit facility or renew or extend our existing senior secured credit facility, or whether any such credit facility will be available under
acceptable terms. Failure to obtain sufficient financing or financing on acceptable terms would constrain our ability to operate our business and to continue our development and expansion projects.
Any of these circumstances could have a material adverse effect on our business, financial condition and results of operation.

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Until
recently, the bond market, and particularly the market for casino bonds, had deteriorated significantly over the prior 18 months. As such, outstanding bonds generally offer
yields to maturity that are significantly higher than the yields offered at issuance. On May 12, 2004, we issued $500 million of 7% senior subordinated notes due in 2014. If the bond
market does not further recover prior to the maturity of these bonds, we may be forced to refinance some or all of its debt on materially worse terms than we have currently. Although it is several
years before these unsecured notes mature, our cash flow from operations is unlikely to be sufficient to retire all of such bonds at or prior to their maturity. Failure to obtain new debt on favorable
or reasonable terms to replace existing debt could affect our liquidity and the value of our other securities, including our equity.

We may not be able to successfully expand to new locations or recover our investment in new properties which would adversely affect our operations and available resources.

We regularly evaluate opportunities for growth through development of gaming operations in existing or new markets, through acquiring
or managing other gaming entertainment facilities or through redeveloping our existing facilities. The expansion of our operations, whether through acquisitions, development, management contracts or
internal growth, could divert management's attention and could also cause us to incur substantial costs, including legal, professional and consulting fees. To the extent that we elect to pursue any
new gaming acquisition, management or development opportunity, our ability to benefit from our investment will depend on many factors, including:



Many
of these factors are beyond our control. There have been significant disruptions in the global capital markets that have adversely impacted the ability of borrowers to access
capital. Many analysts are predicting that these disruptions may continue for the foreseeable future. Accordingly, it is likely that we are dependent on free cash flow from operations and remaining
borrowing capacity under our senior secured credit facility to implement our near-term expansion plans and fund our planned capital expenditures. As a result of these and other
considerations, we cannot be sure that we will be able to recover our investments in any new gaming development or management opportunities or acquired facilities, or successfully expand to additional
locations.

We may experience construction delays during our expansion or development projects that could adversely affect our operations.

From time to time we may commence construction projects at our properties. We also evaluate other expansion opportunities as they
become available and we may in the future engage in additional construction projects. The anticipated costs and construction periods are based upon budgets, conceptual design documents and
construction schedule estimates prepared by us in consultation with our architects and contractors. Construction projects entail significant risks, which can substantially increase costs or delay
completion of a project. Such risks include shortages of materials or skilled labor, unforeseen engineering, environmental or geological problems, work stoppages, weather interference and
unanticipated cost increases. Most of these factors are beyond our control. In addition, difficulties or delays in obtaining any of the requisite licenses, permits or authorizations from regulatory
authorities can increase the cost or delay the completion of an expansion or development. Significant

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budget
overruns or delays with respect to expansion and development projects could adversely affect our results of operations.

If our key personnel leave us, our business could be adversely affected.

Our continued success will depend, among other things, on the efforts and skills of a few key executive officers and the experience of
our property managers. Our ability to retain key personnel is affected by the competitiveness of our compensation packages and the other terms and conditions of employment, our continued ability to
compete effectively against other gaming companies and our growth prospects. The loss of the services of any of these key individuals could have a material adverse effect on our business, financial
condition and results of operations. We do not maintain "key man" life insurance for any of our employees.

We are controlled by the Goldstein family and their decisions may differ from those that may be made by other stockholders.

Members of the Goldstein family, including Robert Goldstein, our Vice Chairman of the Board, and Jeffrey Goldstein and Richard
Goldstein, two of our directors, and various family trusts associated with members of the Goldstein family, collectively own and control approximately 50.1% of our common stock as of May 14,
2010 and have entered into an Agreement, dated as of April 30, 2010 (the "Agreement"), related to the ownership of such common stock. The Agreement includes, but is not limited to an agreement
by the parties to (i) coordinate their efforts with
each other with respect to their ownership of our securities and ensure the interests of the Goldstein family are appropriately considered by our board of directors, (ii) notify the other
parties of any purchase or sale of our securities, and (iii) jointly approve any filing with the Securities and Exchange Commission, press release or stockholder communication by a party.

The
Goldstein family has the power to control the election of our board of directors and the outcome of the vote on substantially all other matters, including amendment of our
certificate of incorporation, amendment of our by-laws and significant corporate transactions, such as the approval of a merger or other transactions involving a sale of the Company. Such
control may have the effect of discouraging transactions involving an actual or potential change of control, which in turn could have a material adverse effect on the market price of our common stock
or prevent our stockholders from realizing a premium over the market price for their shares of common stock. The interests of the Goldstein family may differ from those of our other stockholders.

We have a history of fluctuations in our operating income (losses) from continuing operations, and we may incur additional operating losses from continuing operations in the
future. Our operating results could fluctuate significantly on a periodic basis.

We sustained a net (loss) from continuing operations of $(1.5) million in fiscal 2010 and earned net income from continuing operations
of $61.2 million in fiscal 2009. Companies with fluctuations in income (loss) from continuing operations often find it more challenging to raise capital to finance improvements in their
businesses and to undertake other activities that return value to their stockholders. In addition, companies with operating results that fluctuate significantly on a quarterly or annual basis
experience increased volatility in their stock prices in addition to difficulties in raising capital. We cannot assure you that we will not have fluctuations in our income (losses) from continuing
operations in the future, and should that occur, that we would not suffer adverse consequences to our business as a result, which could decrease the value of our common stock.

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Inclement weather and other conditions could seriously disrupt our business and have a material, adverse effect on our financial condition and results of operations.

The operations of our facilities are subject to disruptions or reduced patronage as a result of severe weather conditions, natural
disasters and other casualties. Because many of our gaming operations are located on or adjacent to bodies of water, these facilities are subject to risks in addition to those associated with other
casinos, including loss of service due to casualty, forces of nature, mechanical failure, extended or extraordinary maintenance, flood, hurricane or other severe weather conditions, and other
disasters, such as the recent oil spill in the Gulf of Mexico. In addition,
severe weather such as high winds and blizzards occasionally limits access to our land-based facilities in Colorado. We cannot be sure that the proceeds from any future insurance claim
will be sufficient to compensate us if one or more of our casinos experience a closure.

Reductions in discretionary consumer spending could have a material adverse effect on our business.

Our business has been and may continue to be adversely affected by the economic recession currently being experienced in the United
States, as we are highly dependent on discretionary spending by our patrons. Changes in discretionary consumer spending or consumer preferences brought about by factors such as increased unemployment,
significant increases in energy prices, perceived or actual deterioration in general economic conditions, the current housing market crisis, bank failures and the potential for additional bank
failures, perceived or actual decline in disposable consumer income and wealth, the current global economic recession and changes in consumer confidence in the economy may continue to reduce customer
demand for the leisure activities we offer and may adversely affect our revenues and operating cash flow. We are not able to predict the length or severity of the current economic circumstances.

The market price of our common stock may fluctuate significantly.

The market price of our common stock has historically been volatile and may continue to fluctuate substantially due to a number of
factors, including actual or anticipated changes in our results of operations, the announcement of significant transactions or other agreements by our competitors, conditions or trends in the our
industry or other entertainment industries with which we compete, general economic conditions including those affecting our customers' discretionary spending, changes in the cost of air travel or the
cost of gasoline, changes in the gaming markets in which we operate and changes in the trading value of our common stock. The stock market in general, as well as stocks in the gaming sector have been
subject to significant volatility and extreme price fluctuations that have sometimes been unrelated or disproportionate to individual companies' operating performances. Broad market or industry
factors may harm the market price of our common stock, regardless of our operating performance.

Work stoppages, organizing drives and other labor problems could negatively impact our future profits.

Some of our employees are currently represented by a labor union or have begun organizing a drive for labor union representation. Labor
unions are making a concerted effort to recruit more employees in the gaming industry. In addition, organized labor may benefit from
new legislation or legal interpretations by the current presidential administration. We cannot provide any assurance that we will not experience additional or more successful union activity in the
future.

Additionally,
lengthy strikes or other work stoppages at any of our casino properties or construction projects could have an adverse effect on our business and result of operations.

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We are or may become involved in legal proceedings that, if adversely adjudicated or settled, could impact our financial condition.

From time to time, we are defendants in various lawsuits and gaming regulatory proceedings relating to matters incidental to our
business. As with all litigation, no assurance can be provided as to the outcome of these matters and, in general, litigation can be expensive and time consuming. We may not be successful in the
defense or prosecution of our current or future legal proceedings, which could result in settlements or damages that could significantly impact our business, financial condition and results of
operations.

Our insurance coverage may not be adequate to cover all possible losses that our properties could suffer. In addition, our insurance costs may increase and we may not be
able to obtain the same insurance coverage in the future.

We may suffer damage to our property caused by a casualty loss (such as fire, natural disasters, acts of war or terrorism), that could
severely disrupt our business or subject us to claims by third parties who are injured or harmed. Although we maintain insurance customary in our industry, (including property, casualty, terrorism and
business interruption insurance) that insurance
may not be adequate or available to cover all the risks to which our business and assets may be subject. The lack of sufficient insurance for these types of acts could expose us to heavy losses if any
damages occur, directly or indirectly, that could have a significant adverse impact on our operations.

We
renew our insurance policies on an annual basis. The cost of coverage may become so high that we may need to further reduce our policy limits or agree to certain exclusions from our
coverage. Among other factors, it is possible that regional political tensions, homeland security concerns, other catastrophic events or any change in government legislation governing insurance
coverage for acts of terrorism could materially adversely affect available insurance coverage and result in increased premiums on available coverage (which may cause us to elect to reduce our policy
limits), additional exclusions from coverage or higher deductibles. Among other potential future adverse changes, in the future we may elect to not, or may not be able to, obtain any coverage for
losses due to acts of terrorism.

The concentration and evolution of the slot machine manufacturing industry could impose additional costs on us.

A large majority of our revenues are attributable to slot machines at our casinos. It is important, for competitive reasons, we offer
the most popular and up-to-date slot machine games, with the latest technology to our customers.

In
recent years, slot machine manufacturers have frequently refused to sell slot machines featuring the most popular games, instead requiring participating lease arrangements. Generally,
a participating lease is substantially more expensive over the long-term than the cost to purchase a new slot machine.

For
competitive reasons, we may be forced to purchase new slot machines, slot machine systems, or enter into participating lease arrangements that are more expensive than our current
costs associated with the continued operation of our existing slot machines. If the newer slot machines do not result in sufficient incremental revenues to offset the increased investment and
participating lease costs, it could adversely affect our profitability.

*
* * * * * *

In
addition to the foregoing, you should consider each of the factors set forth in this Annual Report in evaluating our business and our prospects. The factors described in our
Part 1, Item 1A are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also impair our business
operations. This Annual Report is qualified

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in
its entirety by these risk factors. If any of the foregoing risks actually occur, our business, financial condition and results of operation could be materially harmed. In that case, the trading
price of our securities, including our common stock, could decline significantly.

ITEM 1B.    UNRESOLVED STAFF COMMENTS

None.

ITEM 2.    PROPERTIES

Lake Charles

We own approximately 2.7 acres and lease approximately 16.2 acres of land in Calcasieu Parish, Louisiana for use in
connection with our Lake Charles operations. This lease automatically renewed in March 2010 for five years and we have the option to renew it for 14 additional terms of five years each, subject to
increases based on the Consumer Price Index ("CPI") with a minimum of 10% and construction of hotel facilities on the property. We own two hotels in Lake Charles with a total of 493 rooms.
Annual rent payments under the Lake Charles lease are approximately $2.1 million.

Lula

We lease approximately 1,000 acres of land in Coahoma County, Mississippi and utilize approximately 50 acres in
connection with the operations in Lula, Mississippi. Unless terminated by us at an earlier date, the lease expires in 2033. Rent under the lease is currently 5.5% of gross gaming revenue as reported
to the Mississippi Gaming Commission, plus $100,000 annually. We also own approximately 100 acres in Coahoma County, which may be utilized for future development.

Biloxi

We lease the real estate upon which some of our land-based facilities, including the casino, are located from the City of
Biloxi and the Mississippi Secretary of State at current annual rent of $561,800 per year, plus 3% of our Biloxi property's gross gaming revenues, net of state and local gaming taxes and fees,
in excess of $25.0 million. The lease terminates on July 1, 2014, but it is renewable at our option for four additional terms of five years each and one more option renewal term,
concluding on January 31, 2034, subject to rent increases based on the CPI, limited to 6% for each renewal period.

In
April 1994, in connection with the construction of a hotel, we entered into a lease for additional land adjoining our Biloxi property. This lease with the City of Biloxi and the
Mississippi Secretary of State is for an initial term of 25 years, with options to renew for six additional terms of ten years each and a final option period concluding December 31,
2085. Current annual rent is $605,000 plus 4% of gross non-gaming revenues, as defined in the lease, and renewals are subject to rent increases based on the CPI. The annual rent is
adjusted after each five-year period based on increases in the CPI, limited to a 10% increase in any five-year period.

In
August 2002, we entered into a lease for two additional parcels of land adjoining our property and the hotel. On the parcel adjoining the Biloxi property, we constructed a multi-level
parking garage that has approximately 1,000 parking spaces. There is additional ground level parking on a parcel of land in front of the garage, also subject to this lease, with approximately 600
parking spaces. We have constructed a 400-room addition to the existing hotel on the parcel leased next to the existing hotel. In addition, we may construct a hotel above the parking
garage. This lease with the City of Biloxi and the Mississippi Secretary of State is for an initial term of forty years, with one option to renew for an additional twenty-five years and
additional options thereafter, with the consent of the Mississippi Secretary of State, consistent with the term of the lease described in the preceding paragraph. When

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combined
with the base and percentage rents described for the leases in the preceding two paragraphs, annual rent under those two leases and this lease was $3.8 million for lease year ending
July 31, 2009, and estimated to be $3.8 million for the lease year ending July 31, 2010. The minimum rent for the lease year beginning August 1, 2009 will be
$3.8 million in accordance with the terms of the lease agreement. Such amounts are subject to decreases due to market adjustments and increases based on the CPI. Also, we are responsible for
annual rent equal to 4% of gross retail revenue and gross cash revenue (as defined in the lease), but without double counting. If the rent minimum described in the preceding sentences is not otherwise
satisfied from other rents, then this percentage rent is not in addition to the minimum rent, but rather is to be applied to that minimum.

We
also lease our Biloxi berth from the Biloxi Port Commission at an annual rent of the greater of $510,000 or 1% of the gross gaming revenue net of state and local gaming taxes. The
lease terminates on July 1, 2014 and we have the option to renew it for six additional terms of five years each subject to increases based on the CPI, limited to 6% for each renewal period.

In
connection with and pursuant to a settlement between the City of Biloxi and the State of Mississippi concerning the control and management of the area where we are located, we also
have agreed to pay the City of Biloxi's lease obligations to the State of Mississippi for an agreed upon period of time. This amount is $580,000 per year, payable on June 30, subject to
increases based on the CPI and decreases if there are other tenants of the subject property. This obligation ends after June 2018 but may be renewed for thirty years.

We
have also entered into a joint venture arrangement to sublease a surface parking lot next to our Biloxi property. Our portion of the annual rent under this lease is approximately
$229,000. The current term is for five years expiring December 31, 2010, with a renewal option for an additional five-year term (under which our annual rent would increase based on
the CPI), extending the lease through December 31, 2015, if exercised.

Natchez

Through numerous lease agreements, we lease approximately 24 acres of land in Natchez, Mississippi that are used in connection
with the operations of our Natchez property. Unless terminated by us at an earlier date, the leases have varying expiration dates through 2037. Annual rent under the leases total approximately
$1.2 million. We also lease approximately 7.5 acres of land that is utilized for parking at the facility. We own approximately 6 additional acres of property in Natchez, Mississippi, as
well as the property upon which our hotel is located.

Kansas City

We lease approximately 28 acres of land from the Kansas City Port Authority in connection with the operation of our Kansas City
property. The term of the original lease was ten years and was renewed in October 2006 for an additional five years. The lease includes seven additional five-year renewal options. The
minimum lease payments correspond to any rise or fall in the CPI, initially after the ten-year term of the lease or October 18, 2006 and thereafter, at each five year renewal date.
Rent under the lease currently is the greater of $2.6 million (minimum rent) per year, or 3.25% of gross revenues, less complimentaries.

Boonville

We lease our 27 acre casino site in Boonville pursuant to a lease agreement with the City of Boonville. Under the terms of
agreement, we lease the site for a period of ninety-nine years. In lieu of rent, we are assessed additional amounts by the City of Boonville based on a 3.5% tax on gaming revenue, up to
$1.0 million, which we recognize as additional gaming taxes.

20

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Table of Contents

Caruthersville

We own approximately 37 acres, including our riverboat casino and 1,000 parking spaces in Caruthersville, Missouri.

Bettendorf

We own approximately 24.6 acres of land in Bettendorf, Iowa used in connection with the operations of our Bettendorf property.
We also operate under a long-term lease with the City of Bettendorf, the QC Waterfront Convention Center that is adjacent to our new hotel tower. Future minimum payments associated with
the convention center are approximately $1.1 million per year. We also lease approximately eight acres of land on a month-to-month basis from an entity owned by members
of the Goldstein family, including Robert S. Goldstein, our Vice Chairman of the Board and Jeffrey D. Goldstein and Richard A. Goldstein, directors of our company, which we
utilize for parking. The initial term of the lease expires 60 days after written notice is given to either party and rent under the lease is currently $5,000 per month. We terminated a lease
for warehouse space in January 2010 with the same entity.

Davenport

Pursuant to various lease agreements with the City of Davenport, we lease approximately 12 acres of land in Davenport, Iowa used
in connection with the operations of our Davenport property. The aggregate annual rent on these leases is approximately $0.2 million and they have varying expiration dates through 2022.

Marquette

We lease the dock site in Marquette, Iowa that is used in connection with our Marquette operations. The lease expires in 2019, and
annual rent under the lease is approximately $180,000, plus $1.00 per passenger, plus 2.5% of gaming revenues (less state wagering taxes) in excess of $20.0 million but less than
$40.0 million; 5% of gaming revenues (less state wagering taxes) in excess of $40.0 million but less than $60.0 million; and 7.5% of gaming revenues (less state wagering taxes) in
excess of $60.0 million. We have an easement related to an overhead pedestrian bridge and driveway that is an annual payment of approximately $6,300. We also own approximately 25 acres
of land for the pavilion, satellite offices, warehouse, lots by the marina and other property. Prior to September 2009 at which time the lease was terminated, we leased approximately two acres of land
used for the employee parking lot with a monthly rental of $417.

Waterloo

We own approximately 54 acres of land in Waterloo, Iowa used in connection with the operation of our Waterloo property. We also
entered into a three-year lease agreement for 17,517 square feet of warehouse space. Rent under this lease is currently $5,022 per month.

Isle-Black Hawk

We own approximately 10 acres of land in Black Hawk, Colorado for use in connection with our Black Hawk operations. The property
leases an additional parcel of land adjoining the Isle-Black Hawk where the Lady Luck Hotel and parking are located. This lease is for an initial term of nine years with options to renew
for 18 additional terms of five years each with the final option period concluding June 1, 2094. Annual rent is currently $1.8 million indexed to correspond to any rise or fall in the
CPI at one-year intervals, not to exceed a 3% increase or decrease from the previous year's rate.

21

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Table of Contents

Lady Luck-Black Hawk

We own or lease approximately seven acres of land in Black Hawk, Colorado for use in connection with the Lady Luck-Black
Hawk. The property leases an additional parcel of land near the Lady Luck-Black Hawk for parking as described above. This lease is for an initial term of 10 years with options to
renew for nine additional terms of
10 years each with the final option period concluding August 2094. Currently the annual rent is $576,000 and renewals are subject to 20% rent increases over the rate of the previous term.

Pompano

We own approximately 223 acres at Pompano.

Other

We own all of the riverboats and barges utilized at our facilities. We also own or lease all of our gaming and non-gaming
equipment.

We
lease our principal corporate office in Creve Coeur, Missouri, and office space in Biloxi, Mississippi.

We
own additional property and have various property leases and options to either lease or purchase property that are not directly related to our existing operations and that may be
utilized in the future in connection with expansion projects at our existing facilities or development of new projects.

ITEM 3.    LEGAL PROCEEDINGS

Lady Luck Gaming Corporation (now our wholly owned subsidiary) and several joint venture partners have been defendants in the Greek
Civil Courts and the Greek Administrative Courts in similar lawsuits brought by the country of Greece. The actions allege that the defendants failed to make specified payments in connection with the
gaming license bid process for Patras, Greece. Although it is difficult to determine the damages being sought from the lawsuits, the action may seek damages up to that aggregate amount plus interest
from the date of the action.

In
the Civil Court lawsuit, the Civil Court of First Instance ruled in our favor and dismissed the lawsuit in 2001. Greece appealed to the Civil Appeal Court and, in 2003, the Court
rejected the appeal. Greece then appealed to the Civil Supreme Court and, in 2007, the Supreme Court ruled that the matter was not properly before the Civil Courts and should be before the
Administrative Court.

In
the Administrative Court lawsuit, the Administrative Court of First Instance rejected the lawsuit stating that it was not competent to hear the matter. Greece then appealed to the
Administrative Appeal Court, which court rejected the appeal in 2003. Greece then appealed to the Supreme Administrative Court, which remanded the matter back to the Administrative Appeal Court for a
hearing on the merits. The re-hearing took place in 2006, and in 2008 the Administrative Appeal Court rejected Greece's appeal on procedural grounds. On December 22, 2008 and
January 23, 2009, Greece appealed the ruling to the Supreme Administrative Court. A hearing has tentatively been scheduled for November 2010.

The
outcome of this matter is still in doubt and cannot be predicted with any degree of certainty. We intend to continue a vigorous and appropriate defense to the claims asserted in this
matter. Through April 25, 2010, we have accrued an estimated liability including interest of $10.6 million. Our accrual is based upon management's estimate of the original claim by the
plaintiffs for lost payments. We continue to accrue interest on the asserted claim. We are unable to estimate a total possible loss as

22

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Table of Contents

information
as to possible additional claims, if any, have not been asserted or quantified by the plaintiffs at this time.

We
are subject to certain federal, state and local environmental protection, health and safety laws, regulations and ordinances that apply to businesses generally, and are subject to
cleanup requirements at certain of our facilities as a result thereof. We have not made, and do not anticipate making material expenditures, nor do we anticipate incurring delays with respect to
environmental remediation or protection. However, in part because our present and future development sites have, in some cases, been used as manufacturing facilities or other facilities that generate
materials that are required to be remediated under environmental laws and regulations, there can be no guarantee that additional pre-existing conditions will not be discovered and we will
not experience material liabilities or delays.

We
are subject to various contingencies and litigation matters and have a number of unresolved claims. Although the ultimate liability of these contingencies, this litigation and these
claims cannot be determined at this time, we believe they will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

ITEM 4.    [REMOVED AND RESERVED]

PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

High

LowFirst Quarter (through June 4, 2010)

$
11.71

$
9.21Fiscal Year Ending April 25, 2010Fourth Quarter

$
11.81

$
7.28Third Quarter


9.41


7.21Second Quarter


12.25


9.75First Quarter


13.78


8.65Fiscal Year Ending April 26, 2009Fourth Quarter

$
9.27

$
2.63Third Quarter


5.29


2.37Second Quarter


9.08


3.57First Quarter


7.45


4.20




23

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Table of Contents



None.

We
have purchased our common stock under stock repurchase programs. These programs allow for the repurchase of up to 6,000,000 shares. To date we have purchased 4,895,792 shares of
common stock under these programs. These programs have no approved dollar amount, nor expiration dates. No purchases were made during the fiscal year ended April 25, 2010.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*Among Isle of Capri Casinos, Inc., The NASDAQ Composite Index  and The Dow Jones US Gambling Index

GRAPHIC

---

24

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Table of Contents

ITEM 6.    SELECTED FINANCIAL DATA.

The following table presents our selected consolidated financial data for the five most recent fiscal years, which is derived from our
audited consolidated financial statements and the notes to those statements. Because the data in this table does not provide all of the data contained in our consolidated financial statements,
including the related notes, you should read "Management's Discussion and Analysis of Financial Condition and Results of Operations," our consolidated financial statements, including the related notes
contained elsewhere in this document and other data we have filed with the U.S. Securities and Exchange Commission.

Fiscal Year Ended(1)April 25,
2010

April 26,
2009

April 27,
2008

April 29,
2007

April 30,
2006(dollars in millions, except per share data)Statement of OperationsRevenues:Casino

$
1,013.4

$
1,055.7

$
1,092.3

$
991.4

$
973.3Rooms


43.0


46.4


49.5


49.6


37.0Pari-mutuel, food, beverage and other


135.0


138.6


150.1


145.6


142.2Hurricane and other insurance recoveries





62.9


0.4


2.8


Gross revenues


1,191.4


1,303.6


1,292.3


1,189.4


1,152.5Less promotional allowances


(191.6
)

(195.6
)

(200.9
)

(214.1
)

(200.1
)Net revenues


999.8


1,108.0


1,091.4


975.3


952.4Operating expenses:Casino


153.8


151.6


151.1


154.2


145.5Gaming taxes


262.2


269.9


285.4


213.7


213.9Rooms


10.9


12.3


12.5


10.6


8.8Pari-mutuel, food, beverage and other


44.8


51.5


57.0


44.6


44.4Marine and facilities


61.5


64.4


65.5


58.5


55.3Marketing and administrative


253.1


256.2


270.1


256.4


227.4Corporate and development


46.8


41.3


47.3


56.1


52.8Expense recoveries and other charges, net


(6.8
)

36.1


6.5


7.8


0.2Hurricane and other insurance recoveries





(32.3
)

(1.8
)




Preopening








3.7


11.4


0.3Depreciation and amortization


109.5


122.5


128.9


96.7


85.4Total operating expenses


935.8


973.5


1,026.2


910.0


834.0Operating income


64.0


134.5


65.2


65.3


118.4Interest expense


(75.4
)

(92.0
)

(106.8
)

(88.1
)

(75.1
)Interest income


1.8


2.1


3.2


7.0


2.2Other


(0.3
)










Gain (loss) on early extinguishment of debt





57.7


(15.3
)




(2.1
)Income (loss) from continuing operations before income taxes and including noncontolling interest


(9.9
)

102.3


(53.7
)

(15.8
)

43.4Income tax benefit (provision)


8.4


(41.1
)

20.9


0.8


(10.5
)Income (loss) from continuing operations including noncontrolling interest


(1.5
)

61.2


(32.8
)

(15.0
)

32.9(Loss) income from discontinued operations, net of income taxes


(1.8
)

(17.6
)

(59.2
)

13.9


(7.5
)Net income (loss) including noncontolling interest


(3.3
)

43.6


(92.0
)

(1.1
)

25.4Less net income (loss) attributable to the nocontrolling interest








(4.9
)

(3.5
)

(6.5
)Net income (loss) attributable to common stockholders

$
(3.3
)
$
43.6

$
(96.9
)
$
(4.6
)
$
18.9


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Table of Contents

Fiscal Year Ended(1)April 25,
2010

April 26,
2009

April 27,
2008

April 29,
2007

April 30,
2006(dollars in millions, except per share data)Statement of Operations Data (continued):Income (loss) per common share attributable to common stockholdersBasicIncome (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)
$
(0.61
)
$
0.88Income from discontinued operations


(0.05
)

(0.56
)

(1.92
)

0.46


(0.25
)Net Income (loss)

$
(0.10
)
$
1.39

$
(3.16
)
$
(0.15
)
$
0.63DilutedIncome (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)
$
(0.61
)
$
0.84Income from discontinued operations


(0.05
)

(0.56
)

(1.92
)

0.46


(0.24
)Net Income (loss)

$
(0.10
)
$
1.39

$
(3.16
)
$
(0.15
)
$
0.60Other Data:Net cash provided by (used in):Operating activities

$
106.4

$
190.6

$
133.4

$
70.9

$
86.7Investing activities


(31.0
)

(27.9
)

(302.4
)

(197.3
)

(176.4
)Financing activities


(104.0
)

(157.2
)

72.5


193.5


64.9Capital expenditures


(27.7
)

(58.6
)

(190.5
)

(451.4
)

(224.4
)Balance Sheet Data:Cash and cash equivalents

$
68.1

$
96.7

$
91.8

$
188.1

$
121.0Total assets


1,674.8


1,782.7


1,974.2


2,075.7


1,877.7Long-term debt, including current portion


1,200.9


1,301.1


1,507.3


1,418.0


1,219.1Stockholders' equity


240.2


228.4


188.0


281.8


280.2Operating Data:Number of slot machines


14,579


15,373


15,393


14,121


12,494Number of table games


368


369


387


324


322Number of hotel rooms


3,079


3,104


3,107


2,674


2,652Number of parking spaces


20,696


22,290


21,229


19,484


13,847


(1)Our
fiscal year ended April 30, 2006 includes 53 weeks while all other fiscal years include 52 weeks. The results reflect Lucaya, Blue
Chip, Coventry, Bossier City and Vicksburg as discontinued operations. We opened new casino operations in Pompano, Florida and Waterloo, Iowa in April 2007 and June 2007, respectively. We acquired our
casino operations in Caruthersville, Missouri in June 2007.


ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion together with the financial statements, including the related notes
and the other financial information, contained in this Annual Report on Form 10-K.

Executive Overview

We are a leading developer, owner and operator of branded gaming facilities and related lodging and entertainment facilities in
regional markets in the United States. We have sought and established geographic diversity to limit the risks caused by weather, regional economic difficulties, gaming tax rates and regulations of
local gaming authorities. We currently operate casinos in Mississippi, Louisiana, Missouri, Iowa, Colorado and Florida. We also operate a harness racing track at our casino in Florida.

26

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Table of Contents

Our
operating results for the periods presented have been affected, both positively and negatively, by several factors discussed in detail below. Our business has been and may continue
to be adversely affected by the economic recession currently being experienced in the United States, as we are highly dependent on discretionary spending by our patrons. Our historical operating
results may not be indicative of our future results of operations because of these factors and the changing competitive landscape in each of our markets, as well as by factors discussed elsewhere
herein. This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with and giving consideration to the following:

Items Impacting Income (Loss) from Continuing OperationsSignificant items impacting our income (loss) from continuing operations during the fiscal
years ended April 25, 2010, April 26, 2009 and April 27, 2008 are as follows:

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Hurricane and other insurance recoveries, net

$


$
95.2

$
2.1Expense recoveries and other charges, net


6.8


(36.1
)

(6.5
)Pre-opening








(3.6
)Gain (loss) on early extinguishment of debt





57.7


(15.3
)Noncontrolling interest








(4.9
)




27

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Table of Contents



In
addition to the items in the table the following items also have had an impact on our operations or the comparability of our operating results between years:



Results of Operations

Our results of continuing operations for the fiscal years ended April 25, 2010, April 26, 2009 and April 27, 2008
reflect the consolidated operations of all of our subsidiaries. Our international operations, including Coventry, Blue Chip and Lucaya are presented as discontinued operations. The results for our
fiscal years 2009 and 2008 have been reclassified to reflect the classification of all international operations as discontinued operations as well as to conform our financial presentation to our
current year financial statement format. Our Lucaya operations were classified as discontinued operations in the third quarter of fiscal 2010, our Coventry and Blue Chip Casino operations were
classified as discontinued operations in the fourth quarter of fiscal 2009.

28

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Table of Contents

Our fiscal year ends on the last Sunday in April. This fiscal year convention creates more comparability of our quarterly operations, by generally having an equal
number of weeks (13) and weekend days (26) in each quarter. Periodically, this convention necessitates a 53-week year. The fiscal years ended April 25, 2010,
April 26, 2009 and April 27, 2008 were all 52-week years.

ISLE OF CAPRI CASINOS, INC.        (In thousands)

Net Revenues
Fiscal Year Ended

Operating Income (Loss)
Fiscal Year Ended(in thousands)

April 25,
2010

April 26,
2009

April 27,
2008

April 25,
2010

April 26,
2009

April 27,
2008MississippiBiloxi

$
72,602

$
83,880

$
90,952

$
(8,306
)
$
(7,952
)
$
(3,538
)Natchez


32,826


37,023


35,656


8,868


10,811


7,412Lula


68,147


70,985


75,336


10,692


11,498


11,034Mississippi Total


173,575


191,888


201,944


11,254


14,357


14,908LouisianaLakes Charles


139,423


152,112


159,456


13,317


22,041


20,623MissouriKansas City


76,815


74,435


75,556


13,717


10,369


8,121Boonville


77,759


78,582


79,802


21,125


20,737


19,485Caruthersville(1)


32,685


31,579


26,857


3,853


1,638


2,574Missouri Total


187,259


184,596


182,215


38,695


32,744


30,180IowaBettendorf


79,527


91,661


92,060


12,624


20,090


18,967Davenport


48,075


49,005


52,333


10,494


10,351


8,834Marquette


27,176


29,875


32,866


1,330


3,705


4,380Waterloo(2)


81,261


80,544


64,650


11,614


11,377


5,661Iowa Total


236,039


251,085


241,909


36,062


45,523


37,842ColoradoBlack Hawk/ColoradoCentral Station


126,140


123,382


144,083


14,891


14,688


30,811FloridaPompano


135,998


142,672


160,831


(6,951
)

(6,434
)

(7,442
)Insurance recoveries(3)





61,845


348





94,073


2,105Expense recoveries and other charges, net(4)











6,762


(36,125
)

(6,526
)Pre-opening(2)

















(3,654
)Corporate and other


1,402


455


597


(49,974
)

(46,335
)

(53,696
)From continuing operations

$
999,836

$
1,108,035

$
1,091,383

$
64,056

$
134,532

$
65,151


---

Note:
This table excludes our international properties which have been classified as discontinued operations.

29

---



Table of Contents

Fiscal 2010 Compared to Fiscal 2009

Revenues

Revenues for the fiscal years 2010 and 2009 are as follows:

Fiscal Year Ended(in thousands)

April 25,
2010

April 26,
2009

Variance

Percentage
VarianceRevenues:Casino

$
1,013,386

$
1,055,694

$
(42,308
)

-4.0
%Rooms


43,007


46,380


(3,373
)

-7.3
%Pari-mutuel, food, beverage and other


134,994


138,632


(3,638
)

-2.6
%Hurricane and other insurance recoveries





62,932


(62,932
)

N/MGross revenues


1,191,387


1,303,638


(112,251
)

-8.6
%Less promotional allowances


(191,551
)

(195,603
)

4,052


2.1
%Net revenues

$
999,836

$
1,108,035


(108,199
)

-9.8
%


Casino RevenuesCasino revenues decreased $42.3 million, or 4.0%, in fiscal 2010 compared to fiscal 2009. We experienced a decrease in casino
revenues at most of our properties primarily as a result of the continued deterioration in discretionary consumer spending in conjunction with poor economic conditions, with our properties in Lake
Charles and Biloxi experiencing decreases of $9.5 million and $8.1 million, respectively. Casino revenues at our Quad Cities properties declined $13.9 million due to competition
from a new land-based facility and casino revenues at our Pompano slot facility declined $3.6 million due to expansion of nearby competing Native American casinos.

Rooms RevenueRooms revenue decreased $3.4 million, or 7.3%, in fiscal 2010 compared to fiscal 2009 primarily resulting from decreased
occupancy and lower average room rates as a result of reduced consumer demand for rooms.

Pari-mutuel, Food, Beverage and Other RevenuesPari-mutuel, food, beverage and other revenues decreased $3.6 million,
or 2.6%, in fiscal 2010 compared to fiscal 2009. This decrease was a result of a decrease of $3.7 million in pari-mutuel revenues at Pompano as a result of a 33 day decrease
in year over year live racing days offset by a net increase in food, beverage and other revenues.

Promotional AllowancesPromotional allowances, which are made up of complimentary revenues, cash points and coupons, are rewards that we give our
loyal customers to encourage them to continue to patronize our properties. These allowances decreased by $4.1 million in fiscal 2010 compared to fiscal 2009 due to changes in our promotions and
corresponding reductions in our revenues. For fiscal 2010 and 2009, promotional allowances as a percentage of casino revenues were 18.9% and 18.5%, respectively.

30

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Table of Contents

Operating Expenses

Operating expenses for the fiscal years 2010 and 2009 are as follows:

Fiscal Year Ended(in thousands)

April 25,
2010

April 26,
2009

Variance

Percentage
VarianceOperating expenses:Casino

$
153,838

$
151,610

$
2,228


1.5
%Gaming taxes


262,241


269,928


(7,687
)

-2.8
%Rooms


10,845


12,306


(1,461
)

-11.9
%Pari-mutuel, food, beverage and other


44,760


51,462


(6,702
)

-13.0
%Marine and facilities


61,507


64,368


(2,861
)

-4.4
%Marketing and administrative


253,097


256,210


(3,113
)

-1.2
%Corporate and development


46,750


41,331


5,419


13.1
%Expense recoveries and other charges, net


(6,762
)

36,125


(42,887
)

-118.7
%Hurricane and other insurance recoveries





(32,277
)

32,277


N/MDepreciation and amortization


109,504


122,440


(12,936
)

-10.6
%Total operating expenses

$
935,780

$
973,503


(37,723
)

-3.9
%


CasinoCasino operating expenses increased $2.2 million, or 1.5% in fiscal 2010 compared to fiscal 2009. These expenses are primarily comprised
of salaries, wages and benefits and other operating expenses of our casinos. This increase was primarily the result of increased cost of casino operations at our Black Hawk casinos following a July
2009 regulatory change expanding the hours of gaming operations.

Gaming TaxesGaming taxes decreased by $7.7 million, or 2.8%, in fiscal 2010 compared to fiscal 2009. This reduction in gaming taxes is
primarily a result of a 4.0% decrease in casino gaming revenue and changes in mix of gaming revenues among states with differing gaming tax rates.

RoomsRooms expenses decreased by $1.5 million or 11.9% in fiscal 2010 compared to fiscal 2009. Overall reductions in rooms expenses
corresponds to our 7.3% decline in rooms revenue.

Pari-mutuel, Food, Beverage and OtherPari-mutuel, food, beverage and other expenses decreased $6.7 million, or 13.0%,
in fiscal 2010 as compared to fiscal 2009. Pari-mutuel operating costs at Pompano decreased $4.2 million in fiscal 2010 compared to fiscal 2009. Such costs consist primarily of
compensation, benefits, purses, simulcast fees and other direct costs of track operations. The decreases in current year as compared to prior year are a result of reduction of 33 live racing days
during the current fiscal year. The reduction in food and beverage expenses resulted primarily from labor and other cost reductions. Food and beverage expenses consist primarily of the cost of goods
sold, salaries, wages and benefits and other operating expenses of these departments.

Marine and FacilitiesThese expenses include salaries, wages and benefits of the marine and facilities departments, operating expenses of the marine
crews, maintenance of public areas, housekeeping and general maintenance of the riverboats and pavilions. Marine and facilities expenses decreased $2.9 million, or 4.4%, in fiscal 2010 compared
to fiscal 2009 and is the result of $1.5 million in utility cost reductions, $0.5 million in reduced payroll costs and $0.9 million in other cost reductions.

Marketing and AdministrativeThese expenses include salaries, wages and benefits of the marketing and sales departments, as well as promotions, direct
mail, advertising, special events and entertainment. Administrative expenses include administration and human resource department expenses, rent, professional fees, insurance and property taxes. The
$3.1 million decrease in marketing and

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administrative
expenses in fiscal 2010, as compared to fiscal 2009, reflects our decision to reduce marketing costs to less profitable customer segments and to reduce our administrative costs.

Corporate and DevelopmentDuring fiscal 2010, our corporate and development expenses were $46.8 million compared to $41.3 million for
fiscal 2009. This increase in corporate and development expense reflects $1.8 million of costs associated with the amendment of our credit facility, a $1.1 million increase in stock
compensation expense and other increases in professional and other expenses associated with our development and acquisition activities.

Depreciation and AmortizationDepreciation and amortization expense decreased by $12.9 million, or 10.6%, in fiscal 2010, as compared to fiscal
2009 primarily due to certain assets becoming fully depreciated during the current year.

Other Income (Expense), Income Taxes, Minority Interest and Discontinued Operations

Interest expense, interest income, other, gain on early extinguishment of debt, income tax (provision) benefit, minority interest and
income from discontinued operations, net of income taxes for the fiscal years 2010 and 2009 are as follows:

Fiscal Year Ended(in thousands)

April 25,
2010

April 26,
2009

Variance

Percentage
VarianceInterest expense

$
(75,434
)
$
(92,065
)
$
16,631


-18.1
%Interest income


1,833


2,112


(279
)

-13.2
%Other


(370
)




(370
)

N/MGain on early extinguishment of debt





57,693


(57,693
)

N/MIncome tax (provision) benefit


8,374


(41,039
)

49,413


-120.4
%Loss from discontinued operations, net of income taxes


(1,732
)

(17,658
)

15,926


-90.2
%


Interest ExpenseInterest expense decreased $16.6 million, or 18.1%, in fiscal 2010 compared to fiscal 2009 resulting from lower average debt
balances. Our lower average debt balance resulted from the reduction of $142.7 million of our senior subordinated 7% notes and a $35.0 million repayment on our senior secured credit
facility debt in February and March 2009, respectively. While we have experienced a decrease in the interest rate on the variable interest rate components of our debt through the third quarter of
fiscal 2010, our senior secured credit facility amendment during the fourth quarter of fiscal 2010 increased our overall interest rates. See liquidity and capital resources for additional discussion
of our senior secured credit facility amendment.

Interest IncomeDuring fiscal 2010, our interest income decreased $0.3 million as compared to fiscal 2009. The change in interest income
reflects changes in our invested cash and marketable securities balances and lower interest rates.

OtherThis includes expenses related to the change in fair value of our ineffective interest rate swap agreements.

Income Tax (Provision) BenefitOur income tax (provision) benefit from continuing operations and our effective income tax rate has been impacted by
our settlement of certain tax liabilities for $4.7 million less than our estimated accrual, our amount of annual taxable income (loss) for financial

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statement
purposes as well as our percentage of permanent items in relation to such income or loss. Effective income tax rates were as follows:

April 25,
2010

April 26,
2009Continuing operations


84.4
%

40.1
%Total


73.2
%

41.7
%


Fiscal 2009 Compared to Fiscal 2008

Revenues

Revenues for the fiscal years 2009 and 2008 are as follows:

Fiscal Year Ended(in thousands)

April 26,
2009

April 27,
2008

Variance

Percentage
VarianceRevenues:Casino

$
1,055,694

$
1,092,293

$
(36,599
)

-3.4
%Rooms


46,380


49,498


(3,118
)

-6.3
%Pari-mutuel, food, beverage and other


138,632


150,144


(11,512
)

-7.7
%Hurricane and other insurance recoveries


62,932


348


62,584


N/MGross revenues


1,303,638


1,292,283


11,355


0.9
%Less promotional allowances


(195,603
)

(200,900
)

5,297


2.6
%Net revenues

$
1,108,035

$
1,091,383


16,652


1.5
%


Casino RevenuesCasino revenues decreased $36.6 million, or 3.4%, in fiscal 2009 compared to fiscal 2008. We experienced a decrease in casino
revenues at most of our properties primarily as a result of the continued deterioration in discretionary consumer spending in conjunction with poor economic conditions. Our Black Hawk properties'
$24.2 million decline in casino revenues as compared to fiscal 2008 also reflects the impact of a statewide smoking ban effective for Colorado casinos on January 1, 2008. The
$8.4 million decrease in casino revenues at our Pompano slot facility also reflects the expansion of nearby competing Native American casinos. Decreases in our casino revenues were partially
offset by increases in casino revenues of $20.5 million at our Waterloo and Caruthersville properties due to the casinos being opened for a full 12 months in fiscal 2009 compared to only
10 and nine months, respectively, in fiscal 2008.

Rooms RevenueRooms revenue decreased $3.1 million, or 6.3%, in fiscal 2009 compared to fiscal 2008 primarily resulting from decreased
occupancy and lower average room rates as a result of reduced consumer demand for rooms.

Pari-mutuel, Food, Beverage and Other RevenuesPari-mutuel, food, beverage and other revenues decreased $11.5 million,
or 7.7% in fiscal 2009 compared to fiscal 2008 corresponding to an overall reduction in casino revenues and due to decreases in consumer spending caused by current economic conditions.
Pari-mutuel commissions and fees earned at Pompano decreased $3.2 million, or 16.8% compared to the prior fiscal year due to decreases in wagering. These decreases were offset by
increases at our Waterloo and Caruthersville properties due to the casinos being opened for a full 12 months in fiscal 2009 compared to only 10 and nine months, respectively, in fiscal 2008.

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Promotional AllowancesPromotional allowances, which are made up of complimentary revenues, cash points and coupons, are rewards that we give our
loyal customers to encourage them to continue to patronize our properties. These allowances decreased by $5.3 million in fiscal 2009 compared to fiscal 2008 primarily due to a decrease in
patrons. For fiscal 2009 and 2008, promotional allowances as a percentage of casino revenues were 18.5% and 18.4%, respectively.

Operating Expenses

Operating expenses for the fiscal years 2009 and 2008 are as follows:

Fiscal Year Ended(in thousands)

April 26,
2009

April 27,
2008

Variance

Percentage
VarianceOperating expenses:Casino

$
151,610

$
151,090

$
520


0.3
%Gaming taxes


269,928


285,370


(15,442
)

-5.4
%Rooms


12,306


12,494


(188
)

-1.5
%Pari-mutuel, food, beverage and other


51,462


57,030


(5,568
)

-9.8
%Marine and facilities


64,368


65,469


(1,101
)

-1.7
%Marketing and administrative


256,210


270,087


(13,877
)

-5.1
%Corporate and development


41,331


47,334


(6,003
)

-12.7
%Expense recoveries and other charges, net


36,125


6,526


29,599


453.6
%Hurricane and other insurance recoveries


(32,277
)

(1,757
)

(30,520
)

N/MPre-opening





3,654


(3,654
)

-100.0
%Depreciation and amortization


122,440


128,935


(6,495
)

-5.0
%Total operating expenses

$
973,503

$
1,026,232


(52,729
)

-5.1
%


CasinoCasino operating expenses increased nominally year over year. These expenses are primarily comprised of salaries, wages and benefits and other
operating expenses of our casinos. Casino properties opened in fiscal 2008 experienced a $7.8 million increase in year over year casino expenses while casino properties operating for both years
experienced a $7.3 million reduction in casino expenses corresponding to an overall decrease in gaming revenues and management's increased focus on cost management.

Gaming TaxesState and local gaming taxes decreased by $15.4 million, or 5.4%, in fiscal 2009 compared to fiscal 2008. This reduction in gaming
taxes is primarily a result of a 3.4% decrease in casino gaming revenue and changes in gaming revenues among states with differing gaming tax rates and refund of a $1.9 million in gaming taxes
at our Pompano facility following an agreement reached with the State of Florida regarding the interpretation of the gaming tax calculation based on gaming taxes paid since Pompano's opening.

Pari-mutuel, Food, Beverage and OtherPari-mutuel, food, beverage and other expenses decreased $5.6 million, or 9.8%,
in fiscal 2009 as compared to fiscal 2008. A $2.4 million reduction in food and beverage expenses reflects a decrease in overall food and beverage revenues with food and beverage expenses as a
percentage of gross food and beverage revenues remaining stable in both fiscal 2009 and 2008. Food and beverage expenses consist primarily of the cost of goods sold, salaries, wages and benefits and
other operating expenses of these departments. This decrease reflects the reductions in our food, beverage and other revenues. Pari-mutuel operating costs of Pompano decreased
$3.1 million in fiscal 2009 compared to fiscal 2008. Such costs consist primarily of compensation, benefits, purses, simulcast fees and other direct costs of track operations. The decreases in
the current year as compared to prior year are a result of cost reductions related to our pari-mutuel operations.

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Marine and FacilitiesThese expenses include salaries, wages and benefits of the marine and facilities departments, operating expenses of the marine
crews, maintenance of public areas, housekeeping and general maintenance of the riverboats and pavilions. Marine and facilities expenses decreased $1.1 million, or 1.7%, in fiscal 2009 compared
to fiscal 2008 and is the result of headcount reductions and cost management.

Marketing and AdministrativeThese expenses include salaries, wages and benefits of the marketing and sales departments, as well as promotions, direct
mail, advertising, special events and entertainment. Administrative expenses include administration and human resource department expenses, rent, professional fees, insurance and property taxes. The
$13.9 million decrease in marketing and administrative expenses in fiscal 2009 compared to fiscal 2008, reflects our decision to reduce marketing costs to less profitable customer segments and
to reduce our administrative costs.

Corporate and DevelopmentDuring fiscal 2009, our corporate and development expenses were $41.3 million compared to $47.3 million for
fiscal 2008. This decrease in corporate and development expense reflects our continued efforts to reduce our corporate overhead and includes reductions of $3.5 million in professional and
consulting services as well as reductions in other corporate expenses.

Depreciation and AmortizationDepreciation and amortization expense decreased by $6.5 million, or 5.0%, in fiscal 2009 compared to fiscal 2008
primarily due to certain assets becoming fully depreciated during the current year.

Other Income (Expense), Income Taxes, Minority Interest and Discontinued Operations

Interest expense, interest income, loss on early extinguishment of debt, income tax (provision) benefit, minority interest and income
from discontinued operations, net of income taxes for the fiscal years 2009 and 2008 are as follows:

Fiscal Year Ended(in thousands)

April 26,
2009

April 27,
2008

Variance

Percentage
VarianceInterest expense

$
(92,065
)
$
(106,826
)
$
14,761


-13.8
%Interest income


2,111


3,261


(1,150
)

-35.3
%Gain (loss) on early extinguishment of debt


57,693


(15,274
)

72,967


-477.7
%Income tax (provision) benefit


(41,039
)

20,918


(61,957
)

-296.2
%Loss from discontinued operations, net of income taxes


(17,658
)

(59,236
)

41,578


-70.2
%Income attributable to noncontrolling interest





4,868


(4,868
)

-100.0
%


Interest ExpenseInterest expense decreased $14.8 million, or 13.8%, in fiscal 2009 compared to fiscal 2008. This decrease is primarily
attributable to a lower average debt balance resulting from the pay down of $142.7 million of our senior subordinated 7% notes and a $35.0 million repayment on our senior secured credit
facility debt in February and March 2009, respectively, and a decrease in the interest rate on the variable interest rate components of our debt.

Interest IncomeDuring fiscal 2009, our interest income decreased $1.2 million as compared to fiscal 2008. The change in interest income
reflects changes in our invested cash and marketable securities balances and lower interest rates.

Income Tax (Provision) BenefitOur income tax (provision) benefit from continuing operations and our effective income tax rate has been impacted by
amount of annual taxable income (loss) for

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financial
statement purposes as well as our percentage of permanent items in relation to such income or loss. Effective income tax rates were as follows:

April 26,
2009

April 27,
2008Continuing operations


40.1
%

39.0
%Total


41.7
%

41.3
%


Liquidity and Capital Resources

Cash Flows from Operating ActivitiesDuring fiscal 2010, we generated $106.4 million in cash flows from operating activities compared to
generating $190.6 million during fiscal 2009. The decrease in cash flows from operating activities is primarily due to reductions in net income of $46.8 million as the prior fiscal year
included $60 million in pretax business interruption insurance proceeds from our Hurricane Katrina settlement at our Biloxi property and collection of $20.9 million of income tax
refunds.

Cash Flows used in Investing ActivitiesDuring fiscal 2010 we used $31.0 million for investing activities compared to using
$27.9 million during fiscal 2009. Our fiscal 2010 investing activities include $27.7 million for purchases of property and equipment. Significant investing activities for fiscal 2009
included purchases of property and equipment of $58.6 million primarily offset by the collection of property related insurance proceeds of $32.2 million.

Cash Flows used by Financing ActivitiesDuring fiscal 2010 our net cash flows used by financing activities were $104.0 million primarily
comprised of:



During
fiscal year ended 2009 our net cash flows used by financing activities were $157.2 million primarily comprised of:



Availability of Cash and Additional CapitalAt April 25, 2010, we had cash and cash equivalents of $68.1 million and marketable
securities of $22.9 million. As of April 25, 2010, we had $21.5 million in borrowings under our revolving credit and $817.3 million in term loans outstanding under our
senior secured credit facility. Our net line of credit availability at April 25, 2010 was approximately $109 million as limited by our leverage ratio.

Amendment of our Senior Secured Credit FacilityOn February 17, 2010, we entered into an amendment to our senior secured credit facility which,
among other things, (1) modified the leverage ratio and interest coverage ratio to provide for greater flexibility through April 30, 2012, after which date the ratios return to the
original levels as outlined in the senior secured credit facility; (2) reduced the capacity of the revolving line of credit by $100,000 to $375,000; (3) increased the interest rate of
both the revolving line of credit and term loan portions to LIBOR + 3.00% with a LIBOR floor

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of 2.00%;
and (4) allows us to issue senior unsecured notes, provided the proceeds are used to repay borrowings under the senior secured credit facility.

As
a result of the amendment to the senior secured credit facility, we recorded a charge of approximately $2.2 million in the fourth quarter of fiscal 2010 related to fees and the
write-off of certain unamortized deferred financing costs, of which approximately $0.3 million was non-cash. If current debt levels remain static, we expect our annual
interest expense to increase by approximately $15 million to $18 million as a result of the amendment to the senior secured credit facility, beginning during the fourth quarter of fiscal
2010.

Capital Expenditures and Development ActivitiesHistorically, we have made significant investments in property and equipment and expect that our
operations will continue to demand ongoing investments to keep our properties competitive.

In
June 2010 we expect to close on our purchase of the Rainbow casino in Vicksburg, Mississippi. We expect to fund the $80 million purchase price with borrowings under our senior
secured credit facility. While the $80 million used to acquire the Rainbow casino will increase the outstanding balance of our senior credit facility, our overall credit availability will not
be materially impacted by the acquisition after the purchase.

In
fiscal 2011, we plan to invest approximately $48 million in maintenance capital expenditures.

Historically,
we have funded our daily operations through net cash provided by operating activities and our significant capital expenditures through operating cash flow and debt
financing. While we believe that existing cash, cash flow from operations, and available borrowings under our senior secured credit facility will be sufficient to support our working capital needs,
pending purchase of the Rainbow casino, planned capital expenditures and debt service requirements for the foreseeable future, there is no assurance that these sources will in fact provide adequate
funding for our planned and necessary expenditures or that our planned reduced levels of capital investments will be sufficient to allow us to remain competitive in our existing markets.

We
have identified several capital projects primarily focused on refreshing our hotel room inventory as well as additional improvements to our Black Hawk and Lake Charles properties, and
further Lady Luck conversions. The timing and amount of these capital expenditures will be determined as we gain more clarity as to improvement of economic and local market conditions, cash flows from
our continuing operations and availability of cash under our senior secured credit facility.

We
have entered into an agreement to provide management services for a potential casino to be located at the Nemacolin Woodlands Resort in Farmington, Pennsylvania, ("the Resort"). The
development of this casino is subject to numerous regulatory approvals including obtaining a state gaming license, which is a competitive award process among several applicants. If the Resort is
successful in obtaining a gaming license, we have agreed to complete the build-out of the casino space. We currently estimate the project cost at approximately $50 million.

We
are highly leveraged and may be unable to obtain additional debt or equity financing on acceptable terms if our current sources of liquidity are not sufficient or if we fail to stay
in compliance with the covenants of our senior secured credit facility. We will continue to evaluate our planned capital expenditures at each of our existing locations in light of the operating
performance of the facilities at such locations.

As
part of our business development activities, historically we have entered into agreements which have resulted in the acquisition or development of businesses or assets. These business
development efforts and related agreements typically require the expenditure of cash, which may be significant. The amount and timing of our cash expenditures relating to development activities may
vary based upon our evaluation of current and future development opportunities, our financial condition and the

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condition
of the financing markets. Our development activities are subject to a variety of factors including but not limited to: obtaining permits, licenses and approvals from appropriate regulatory
and other agencies, legislative changes and, in certain circumstances, negotiating acceptable leases.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles that require our
management to make estimates and assumptions that affect reported amounts and related disclosures. Management identifies critical accounting estimates as:



Based
upon management's discussion of the development and selection of these critical accounting estimates with the Audit Committee of our Board of Directors, we believe the following
accounting estimates involve a higher degree of judgment and complexity.

Goodwill and Other Intangible AssetsAt April 25, 2010, we had goodwill and other intangible assets of $392.8 million, representing
23.4% of total assets. Statement of Financial Accounting Standards (SFAS) No. 142 "Goodwill and Other Intangible Assets" ("SFAS 142"), is now included in ASC Topic 350,
IntangiblesGoodwill and Other. For goodwill and indefinite-lived intangible assets, we perform an annual impairment test for these assets in the fourth fiscal quarter of each year, or on
an interim basis if indicators of impairment exist. For properties with goodwill and/or other intangible assets with indefinite lives, this test requires the comparison of the implied fair value of
each reporting unit to carrying value.

We
must make various assumptions and estimates in performing our impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and
supportable assumptions which represent our best estimates of the cash flows expected to result from the use of the assets including their eventual disposition and by a market approach based upon
valuation multiples for similar companies. Changes in estimates, increases in our cost of capital, reductions in transaction multiples or application of alternative assumptions and definitions could
produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from our estimates. If our ongoing estimates of future
cash flows are not met, we may have to record additional impairment charges in future accounting periods. Our estimates of cash flows are based on the current regulatory, social and economic climates,
recent operating information and budgets of the various properties where we conduct operations. These estimates could be negatively impacted by changes in federal, state or local regulations, economic
downturns, or other events affecting various forms of travel and access to our properties.

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We engaged an independent third party valuation firm to conduct our annual impairment testing for fiscal 2010. Our reporting units with goodwill and/or other
long-lived intangibles had fair values which exceeded their carrying values by at least 15%, except for our Black Hawk reporting unit with goodwill and indefinite-lived assets as of
April 25, 2010 of $30.6 million, which whose fair value exceeded its carrying value by 6%. During our 2009 annual impairment test, we recorded an impairment charge of
$18.3 million to write-down goodwill and indefinite lived intangible assets at Black Hawk reporting unit.

Property and EquipmentAt April 25, 2010, we had property and equipment, net of accumulated depreciation of $1.1 billion, representing
66% of total assets. We capitalize the cost of property and equipment. Maintenance and repairs that neither materially add to the value of the property or equipment nor appreciably prolong its life
are charged to expense as incurred. We depreciate property and equipment on a straight-line basis over their estimated useful lives. The estimated useful lives are based on the nature of
the assets as well as our current operating strategy. Future events such as property expansions, new competition, changes in technology and new regulations could result in a change in the manner in
which we are using certain assets requiring a change in the estimated useful lives of such assets.

Impairment of Long-lived AssetsWe evaluate long-lived assets for impairment in accordance with the guidance in the Impairment
or Disposal of Long Lived Assets subsection of ASC Topic 360, Property, Plant and Equipment (ASC Topic 360"). For a long-lived asset to be held and used, we review the asset for impairment
whenever events or changes in circumstances indicate the carrying amount may not be recoverable. In assessing the recoverability of the carrying value of such property, equipment and other
long-lived assets, we make assumptions regarding future cash flows and residual values. If these estimates or the related assumptions are not achieved or change in the future, we may be
required to record an impairment loss for these assets. In evaluating impairment of long-lived assets for newly opened operations, estimates of future cash flows and residual values may
require some period of actual results to provide the basis for an opinion of future cash flows and residual values used in the determination of an impairment loss for these assets. For assets held for
disposal, we recognize the asset at the lower of carrying value or fair market value, less cost of disposal based upon appraisals, discounted cash flows or other methods as appropriate. An impairment
loss would be recognized as a non-cash component of operating income.

During
the fourth quarter of fiscal 2009, we recorded a charge of $1.4 million to reduce our Blue Chip assets held for sale to their estimated fair value less the cost to sell.

During
the fourth quarter of fiscal 2008, we engaged an independent third party valuation firm to conduct an appraisal of our long-lived assets associated with our casino
property in Coventry, England due to the continuation of losses from operations, a review of expected future operating trends and the current fair values of our long-lived assets in
Coventry, England. Based upon this appraisal, we recorded an impairment charge of $78.0 million relating to the write-down of long-lived assets at our Coventry property
in fiscal 2008.

Self-Insurance LiabilitiesWe are self-funded up to a maximum amount per claim for our employee-related health care benefits
program, workers' compensation and general liabilities. Claims in excess of this maximum are fully insured through a stop-loss insurance policy. We accrue a discounted estimate for
workers' compensation liability and general liabilities based on claims filed and estimates of claims incurred but not reported. We rely on independent consultants to assist in the determination of
estimated accruals. While the estimated cost of claims incurred depends on future developments, such as increases in health care costs, in our opinion, recorded reserves are adequate to cover future
claims payments. Based upon our current accrued insurance liabilities, a 1% change in our discount factor would cause a $0.7 million change in our accrued self-insurance liability.

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Income Tax Assets and LiabilitiesWe account for income taxes in accordance with the guidance in ASC Topic 740, Income Taxes ("ASC Topic 740"). We are
subject to income taxes in the United States and in several states in which we operate. We recognize a current tax asset or liability for the estimated taxes payable or refundable based upon
application of the enacted tax rates to taxable income in the current year. Additionally, we are required to recognize a deferred tax liability or asset for the estimated future tax effects
attributable to temporary differences. Temporary differences occur when differences arise between: (a) the amount of taxable income and pretax financial income for a year and (b) the tax
basis of assets or liabilities and their reported amounts in financial statements. Deferred tax assets recognized must be reduced by a valuation allowance for any tax benefits that, in our judgment
and based upon available evidence, may not be realizable.

We
assess our tax positions using a two-step process. A tax position is recognized if it meets a "more likely than not" threshold, and is measured at the largest amount of
benefit that is greater than 50 percent likely of being realized. Uncertain tax positions must be reviewed at each balance sheet date. Liabilities recorded as a result of this analysis must
generally be recorded separately from any current or deferred income tax accounts, and are classified as current Other accrued liabilities or long-term Other long-term
liabilities based on the time until expected payment. We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense.

Stock Based CompensationWe apply the guidance of ASC Topic 718, CompensationStock Compensation ("ASC Topic 718") in accounting for stock
compensation. Generally, we are required to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award.
The estimate of the fair value of the stock options is calculated using the Black-Scholes-Merton option-pricing model. This model requires the use of various assumptions, including the historical
volatility, the risk free interest rate, estimated expected life of the grants, the estimated dividend yield and estimated rate of forfeitures. Total stock based compensation expense is included in
the expense category corresponding to the employees' regular compensation in the accompanying consolidated statements of operations.

Derivative InstrumentsWe utilize an investment policy for managing risks associated with our current and anticipated future borrowings, such as
interest rate risk and its potential impact on our fixed and variable rate debt. We are also currently required to have at least 50% of our term loans under our senior secured credit facility covered
by some form of interest protection. Currently we have $400 million of interest rate swap agreements and a $20 million interest rate cap agreement. Under this policy, we may utilize
derivative contracts that effectively convert our borrowings from either floating-to-fixed or fixed-to-floating. The policy does not allow for the use
of derivative financial instruments for trading or speculative purposes. To the extent we employ such financial instruments pursuant to this policy, and the instruments qualify for hedge accounting,
we may designate and account for them as hedged instruments. In order to qualify for hedge accounting, the underlying hedged item must expose us to risks associated with market fluctuations and the
financial instrument used must be designated as a hedge and must reduce our exposure to market fluctuations throughout the hedged period. If these criteria are not met, a change in the market value of
the financial instrument is recognized as a gain (loss) in the period of change. Otherwise, gains and losses related to the change in the market value are not recognized except to the extent that the
hedged debt is disposed of prior to maturity or to the extent that unacceptable ranges of ineffectiveness exist in the hedge. Net interest paid or received pursuant to the hedged financial instrument
is included in interest expense in the period. Our current interest rate swap agreements, which were designated as cash flow hedges, became ineffective upon the amendment of our senior secured credit
facility in February 2010. We record them at fair value and measure their effectiveness using the long-haul method. The effective portion of any gain or loss on our interest rate swaps is
recorded in other comprehensive income (loss). We use the hypothetical derivative method to measure the ineffective portion of our interest rate swaps. The ineffective portion, if any, is recorded in
other income (expense). We measure the

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mark-to-market
value of our interest rate swaps using a discounted cash flow analysis of the projected future receipts or payments based upon the forward yield curve on the
date of measurement. We adjust this amount to measure the fair value of our interest rate swaps by applying a credit valuation adjustment to the mark-to-market exposure
profile.

ContingenciesWe are involved in various legal proceedings and have identified certain loss contingencies. We record liabilities related to these
contingencies when it is determined that a loss is probable and reasonably estimable in accordance with the guidance of ASC Topic 450 Contingencies ("ASC Topic 450"). These assessments are based on
our knowledge and experience as well as the advice of legal counsel regarding current and past events. Any such estimates are also subject to future events, court rulings, negotiations between the
parties and other uncertainties. If an actual loss differs from our estimate, or the actual outcome of any of the legal proceedings differs from expectations, operating results could be impacted.

Contractual Obligations and Commercial Commitments

The following table provides information as of fiscal 2010, about our contractual obligations and commercial commitments. The table
presents contractual obligations by due dates and related contractual commitments by expiration dates (in millions).

Payments Due by PeriodContractual Obligations

Total

Less Than
1 Year

1 - 3 Years

4 - 5 Years

After 5 YearsLong-Term Debt

$
1,200.9

$
8.7

$
39.1

$
1,150.2

$
2.9Estimated interest payments on long-term debt(1)


277.7


77.9


145.1


52.2


2.5Operating Leases


508.8


20.5


32.9


31.9


423.5Long-Term Obligations(2)


18.4


9.1


5.8


1.4


2.1Other Long-Term Obligations


23.7


1.1


2.2


2.9


17.5Total Contractual Cash Obligations

$
2,029.5

$
117.3

$
225.1

$
1,238.6

$
448.5


(1)Estimated
interest payment on long-term debt are based on principal amounts outstanding at our fiscal year end and forecasted LIBOR rates for
our senior secured credit facility.(2)Long-term
obligations include future purchase commitments as well as current and future construction contracts.


Recently Issued Accounting Standards

Recently Issued Accounting StandardsNew PronouncementsIn June 2009, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standard ("SFAS") No. 168, "TheFASB Accounting Standards CodificationTMand the Hierarchy of Generally
Accepted Accounting Principlesa replacement of FASB Statement No. 162" ("ASC"), which identifies the sources of accounting principles and the framework for selecting the principles
used in the preparation of financial statements of nongovernmental entities that are presented in conformity with GAAP in the United States (the GAAP hierarchy). SFAS 168 establishes the FASB Accounting Standards
CodificationTMas the source of authoritative accounting principles recognized by the FASB to be applied by
nongovernmental entities in the preparation of financial statements in conformity with GAAP. SFAS 168 is effective for most financial statements issued for interim and annual periods ending
after September 15, 2009. The adoption of this guidance has changed how we reference various elements of GAAP when preparing our financial statement disclosures, but did not have an impact on
our consolidated financial statements.

41

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Table of Contents

In
December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial StatementsAn Amendment of ARB No. 51" ("SFAS 160").
SFAS 160 changes the accounting for noncontrolling (minority) interests in consolidated financial statements, requires noncontrolling interests to be reported as part of equity and changes the
income statement presentation of income or losses attributable to the noncontrolling interests. We adopted SFAS 160 as of April 27, 2009, as required. The adoption of SFAS 160 did
not have a material impact on our consolidated financial statements.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss arising from adverse changes in market rates and prices, including interest rates, foreign currency
exchange rates, commodity prices and equity prices. Our primary exposure to market risk is interest rate risk associated with our senior secured credit facility.

Senior Secured Credit Facility

During fiscal 2010, we maintained interest rate swap agreements and an interest rate cap arrangement with an aggregate notional value
of $400 million and $20 million as of April 25, 2010, respectively. The swap agreements effectively convert portions of the senior secured credit facility variable debt to a
fixed-rate basis until the respective swap agreements terminate, which occurs through fiscal 2014.

The
following table provides information at April 25, 2010 about our financial instruments that are sensitive to changes in interest rates. The table presents principal cash flows
and related weighted average interest rates by expected maturity dates.

Interest Rate Sensitivity  Principal (Notional) Amount by Expected Maturity  Average Interest (Swap) Rate

Fiscal year
(dollars in millions)

2011

2012

2013

2014

2015

Thereafter

Total

Fair Value
4/25/2010LiabilitiesLong-term debt, including current portionFixed rate

$
0.2

$
0.2

$
0.2

$
357.5

$
0.2

$
2.9

$
361.2

$
329.9Average interest rate


7.01
%

7.01
%

7.01
%

7.01
%

8.50
%

8.50
%Variable rate

$
8.6

$
8.6

$
30.1

$
792.3

$
0.2

$


$
839.8

$
823.0Average interest rate(1)


5.05
%

5.05
%

5.53
%

6.47
%

3.45
%

0.00
%Interest Rate Derivative Financial Instruments Related to DebtInterest rate swapsPay fixed/receive variable

$
300.0

$
50.0

$


$
50.0

$


$


$
400.0Average pay rate


4.52
%

4.20
%

4.00
%

4.00
%

0.00
%

0.00
%Average receive rate


0.50
%

1.84
%

3.11
%

3.64
%

0.00
%

0.00
%


(1)Represents
the annual average LIBOR from the forward yield curve at April 25, 2010 plus the weighted average margin above LIBOR on all consolidated
variable rate debt.


42

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Table of Contents




As of April, 25, 2010, our senior secured credit facility contained variable rate debt based on LIBOR with a floor of 2%, which is above the
current market LIBOR rates we receive under our interest rate swap agreement. In addition, we have purchased an interest rate cap at 3% for a notional amount of $20 million to further hedge our
interest rate exposure. The following table depicts the estimated impact on our annual interest expense for the relative changes in interest rate based upon current debt levels:

Increase to
variable rate

Increase/(decrease)
(in millions)1
%
$
(4.0
)2
%

(5.6
)3
%

(1.2
)4
%

2.95
%

7.1


43

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Table of Contents

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The following consolidated financial statements are included in this report:



Report of Independent Registered Public Accounting Firm on Internal Control Over Financial ReportingReport of Independent Registered Public Accounting Firm on Consolidated Financial StatementsConsolidated Balance SheetsApril 25, 2010 and April 26, 2009Fiscal Years Ended April 25, 2010, April 26, 2009 and April 27, 2008Consolidated Statements of OperationsConsolidated Statements of Stockholders' EquityConsolidated Statements of Cash FlowsNotes to Consolidated Financial StatementsSchedule IIValuation and Qualifying AccountsFiscal Years Ended April 25, 2010,
April 26, 2009 and April, 27, 2008


44

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Table of Contents



Report of Independent Registered Public Accounting Firm

The
Board of Directors and Stockholders
Isle of Capri Casinos, Inc.

We
have audited Isle of Capri Casino, Inc.'s internal control over financial reporting as of April 25, 2010, based on criteria established in Internal
ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Isle of Capri Casino, Inc.'s management is responsible for
maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's
Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the company's internal control over financial reporting based on our audit.

We
conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A
company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In
our opinion, Isle of Capri Casinos, Inc. maintained, in all material respects, effective internal control over financial reporting as of April 25, 2010, based on the COSO
criteria.

We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Isle of Capri Casinos, Inc. as
of April 25, 2010, and April 26, 2009, and the related consolidated statements of operations, stockholder's equity, and cash flows for the fiscal years ended April 25, 2010,
April 26, 2009, and April 27, 2008, and our report dated June 8, 2010, expressed an unqualified opinion thereon.

/s/
Ernst & Young LLP
Saint Louis, Missouri

June 8,
2010

45

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Table of Contents



Report of Independent Registered Public Accounting Firm

The
Board of Directors and Stockholders
Isle of Capri Casinos, Inc.

We
have audited the accompanying consolidated balance sheets of Isle of Capri Casinos, Inc. (the Company) as of April 25, 2010, and April 26, 2009, and the related
consolidated statements of operations, stockholders' equity, and cash flows for the fiscal years ended April 25, 2010, April 26, 2009, and April 27, 2008. Our audits also included
the financial statement schedule listed in the Index at Item 15(a). These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
these financial statements and schedule based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.

In
our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Isle of Capri Casinos, Inc. at
April 25, 2010, and April 26, 2009, and the consolidated results of its operations and its cash flows for the years ended April 25, 2010, April 26, 2009, and
April 27, 2008, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Isle of Capri Casinos, Inc.'s internal control over financial
reporting as of April 25, 2010, based on the criteria established inInternal ControlIntegrated Frameworkissued by the Committee of
Sponsoring Organizations of the Treadway Commission, and our report date June 8, 2010, expressed an unqualified opinion thereon.

/s/
Ernst & Young LLP
Saint Louis, Missouri

June 8,
2010

46

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Table of Contents



ISLE OF CAPRI CASINOS, INC.        CONSOLIDATED BALANCE SHEETS        (In thousands, except share and per share amounts)

April 25,
2010

April 26,
2009ASSETSCurrent assets:Cash and cash equivalents

$
68,069

$
96,654Marketable securities


22,926


17,548Accounts receivable, net of allowance for doubtful accounts of $1,955 and $5,106, respectively


8,879


11,935Income taxes receivable


8,109


7,744Deferred income taxes


16,826


16,295Prepaid expenses and other assets


25,095


23,234Assets held for sale





4,183Total current assets


149,904


177,593Property and equipment, net


1,098,942


1,177,540Other assets:Goodwill


313,136


313,136Other intangible assets, net


79,675


83,588Deferred financing costs, net


10,354


9,314Restricted cash


2,774


2,774Prepaid deposits and other


20,055


18,717Total assets

$
1,674,840

$
1,782,662LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilities:Current maturities of long-term debt

$
8,754

$
9,688Accounts payable


24,072


15,079Accrued liabilities:Payroll and related


45,863


47,402Property and other taxes


20,253


31,563Interest


14,779


9,280Progressive jackpots and slot club awards


14,144


13,892Other


29,290


39,201Liabilities related to assets held for sale





1,888Total current liabilities


157,155


167,993Long-term debt, less current maturities


1,192,135


1,291,384Deferred income taxes


29,193


24,970Other accrued liabilities


38,972


52,575Other long-term liabilities


17,166


17,314Stockholders' equity:Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued





Common stock, $.01 par value; 45,000,000 shares authorized; shares issued:36,771,730 at April 25, 2010 and 36,111,089 at April 26, 2009


367


361Class B common stock, $.01 par value; 3,000,000 shares authorized; none issued





Additional paid-in capital


201,464


193,827Retained earnings


98,555


101,828Accumulated other comprehensive income (loss)


(8,060
)

(15,191
)292,326


280,825Treasury stock, 4,326,242 shares at April 25, 2010 and 4,340,436 shares at April 26, 2009


(52,107
)

(52,399
)Total stockholders' equity


240,219


228,426Total liabilities and stockholders' equity

$
1,674,840

$
1,782,662


See accompanying notes to consolidated financial statements.

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ISLE OF CAPRI CASINOS, INC.        CONSOLIDATED STATEMENTS OF OPERATIONS        (In thousands, except share and per share amounts)

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Revenues:Casino

$
1,013,386

$
1,055,694

$
1,092,293Rooms


43,007


46,380


49,498Pari-mutuel, food, beverage and other


134,994


138,632


150,144Hurricane and other insurance recoveries





62,932


348Gross revenues


1,191,387


1,303,638


1,292,283Less promotional allowances


(191,551
)

(195,603
)

(200,900
)Net revenues


999,836


1,108,035


1,091,383Operating expenses:Casino


153,838


151,610


151,090Gaming taxes


262,241


269,928


285,370Rooms


10,845


12,306


12,494Pari-mutuel, food, beverage and other


44,760


51,462


57,030Marine and facilities


61,507


64,368


65,469Marketing and administrative


253,097


256,210


270,087Corporate and development


46,750


41,331


47,334Expense recoveries and other charges, net


(6,762
)

36,125


6,526Hurricane and other insurance recoveries





(32,277
)

(1,757
)Preopening








3,654Depreciation and amortization


109,504


122,440


128,935Total operating expenses


935,780


973,503


1,026,232Operating income


64,056


134,532


65,151Interest expense


(75,434
)

(92,065
)

(106,826
)Interest income


1,833


2,112


3,261Gain (loss) on early extinguishment of debt





57,693


(15,274
)Other expense


(370
)




Income (loss) from continuing operations before income taxes and including noncontrolling interest


(9,915
)

102,272


(53,688
)Income tax benefit (provision)


8,374


(41,039
)

20,918Income (loss) from continuing operations including noncontrolling interest


(1,541
)

61,233


(32,770
)Loss from discontinued operations including gain (loss) on sale, net of income tax benefit of $566, $9,887 and $43,902 for the fiscal years ended 2010, 2009
and 2008, respectively


(1,732
)

(17,658
)

(59,236
)Net income (loss) including noncontrolling interest


(3,273
)

43,575


(92,006
)Net income attributable to noncontrolling interest








(4,868
)Net income (loss) attributable to common stockholders

$
(3,273
)
$
43,575

$
(96,874
)Earnings (loss) per common share attributable to common stockholdersbasic:Income (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)Loss from discontinued operations including gain on sale, net of income taxes


(0.05
)

(0.56
)

(1.92
)Net income (loss) attributable common stockholders

$
(0.10
)
$
1.39

$
(3.16
)Earnings (loss) per common share attributable to common stockholdersdilutedIncome (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)Loss from discontinued operations including gain on sale, net of income taxes


(0.05
)

(0.56
)

(1.92
)Net income (loss) attributable common stockholders

$
(0.10
)
$
1.39

$
(3.16
)Weighted average basic shares


32,245,769


31,372,670


30,699,457Weighted average diluted shares


32,245,769


31,379,016


30,699,457


See accompanying notes to consolidated financial statements.

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ISLE OF CAPRI CASINOS, INC.        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY        (In thousands, except share amounts)

Shares of
Common
Stock

Common
Stock

Additional
Paid-in
Capital

Retained
Earnings

Accum.
Other
Comprehensive
Income
(Loss)

Treasury
Stock

Total
Stockholders'
EquityBalance, April 29, 2007


34,682,534

$
347

$
175,132

$
155,127

$
3,358

$
(52,142
)
$
281,822Net loss











(96,874
)







(96,874
)Unrealized loss on interest rate swap contracts net of income tax benefit of $5,159














(8,555
)




(8,555
)Foreign currency translation adjustments














(404
)




(404
)Comprehensive loss




















(105,833
)Exercise of stock options, including income tax benefit of $977


546,472


6


5,741











5,747Issuance of deferred bonus shares from treasury stock








(414
)







414


Purchase of treasury stock

















(1,301
)

(1,301
)Other








265











265Stock compensation expense








7,312











7,312Balance, April 27, 2008


35,229,006


353


188,036


58,253


(5,601
)

(53,029
)

188,012Net income











43,575








43,575Unrealized loss on interest rate swap contracts net of income tax benefit of $3,720














(6,255
)




(6,255
)Foreign currency translation adjustments














(3,335
)




(3,335
)Comprehensive income




















33,985Exercise of stock options


36,414





110











110Issuance of deferred bonus shares from treasury stock








(630
)







630


Other


664





(806
)










(806
)Issuance of restricted stock, net of forfeitures


845,005


8


(8
)










Stock compensation expense








7,125











7,125Balance, April 26, 2009


36,111,089


361


193,827


101,828


(15,191
)

(52,399
)

228,426Net loss











(3,273
)







(3,273
)Unrealized gain on interest rate swap contracts net of income tax provision of $2,683














4,456





4,456Deferred hedge adjustment net of income tax provision of $1,463














2,449





2,449Foreign currency translation adjustments














226





226Comprehensive income




















3,858Exercise of stock options


21,602





204











204Issuance of deferred bonus shares from treasury stock








(292
)







292


Other


664





103











103Issuance of restricted stock, net of forfeitures


638,375


6


(6
)










Stock compensation expense








7,628











7,628Balance, April 25, 2010


36,771,730

$
367

$
201,464

$
98,555

$
(8,060
)
$
(52,107
)
$
240,219


See accompanying notes to consolidated financial statements.

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ISLE OF CAPRI CASINOS, INC.        CONSOLIDATED STATEMENTS OF CASH FLOWS        (In thousands)

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Operating activities:Net income (loss)

$
(3,273
)
$
43,575

$
(96,874
)Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation and amortization


109,504


127,222


136,127Amortization of deferred financing costs


2,834


2,470


2,700(Gain) loss on early extinguishment of debt





(57,693
)

15,274Property insurance recoveries





(32,179
)

Expense recoveries and other charges, net


(6,762
)

36,525


85,184Deferred income taxes


(455
)

32,751


(35,194
)Stock compensation expense


7,633


7,125


7,312Deferred compensation expense


103


175


265Loss on derivative instruments


370





550Loss (gain) on disposal of assets


722


12,161


(90
)Noncontrolling interest








4,868Changes in operating assets and liabilities:Sales (purchases) of trading securities


(5,378
)

985


(1,364
)Accounts receivable


3,274


1,548


10,276Income taxes receivable


(365
)

20,919


(32,562
)Insurance receivable


2,204


5,486


48,393Prepaid expenses and other assets


4,546


8,551


(1,098
)Accounts payable and accrued liabilities


(8,575
)

(19,011
)

(10,410
)Net cash provided by operating activities


106,382


190,610


133,357Investing activities:Purchase of property and equipment


(27,690
)

(58,579
)

(190,459
)Property insurance recoveries





32,179


Payments towards gaming license


(4,000
)

(4,000
)

(4,000
)Net cash paid for acquisitions








(107,895
)Proceeds from sales of assets held for sale


653


954


Restricted cash


47


1,579


65Other








(157
)Net cash used in investing activities


(30,990
)

(27,867
)

(302,446
)Financing activities:Principal repayments on long-term debt


(8,730
)

(127,457
)

(697,108
)Net (repayments) borrowings on line of credit


(91,558
)

(18,484
)

(99,355
)Termination payment relating to other long-term liabilities





(11,352
)

Proceeds from long-term debt borrowings








875,000Payment of deferred financing costs


(3,874
)




(8,881
)Purchase of treasury stock








(1,301
)Distribution to noncontrolling interest








(1,588
)Proceeds from exercise of stock options


204


110


5,747Net cash (used by) provided by financing activities


(103,958
)

(157,183
)

72,514Effect of foreign currency exchange rates on cash


(19
)

(696
)

251Net (decrease) increase in cash and cash equivalents


(28,585
)

4,864


(96,324
)Cash and cash equivalents at beginning of year


96,654


91,790


188,114Cash and cash equivalents at end of year

$
68,069

$
96,654

$
91,790


See accompanying notes to consolidated financial statements.

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ISLE OF CAPRI CASINOS, INC.        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS        (amounts in thousands, except share and per share amounts)

1. Organization

OrganizationIsle of Capri Casinos, Inc., a Delaware corporation, was incorporated in February 1990. Except where otherwise noted, the words
"we," "us," "our" and similar terms, as well as "Company," refer to Isle of Capri Casinos, Inc. and all of its subsidiaries. We are a leading developer, owner and operator of branded gaming
facilities and related lodging and entertainment facilities in markets throughout the United States. Our wholly owned subsidiaries own and operate thirteen casino gaming facilities in the United
States located in Black Hawk, Colorado; Lake Charles, Louisiana; Lula, Biloxi and Natchez, Mississippi; Kansas City, Caruthersville and Boonville, Missouri; Bettendorf, Davenport, Waterloo and
Marquette, Iowa; and Pompano Beach, Florida. Effective January 27, 2008, we own 100% of our operations in Black Hawk, Colorado following the acquisition of our minority partner's 43% interest
in those operations. Our international gaming interests included wholly owned casinos in Freeport, Grand Bahamas, Coventry, Dudley and Wolverhampton, England, which are now classified as discontinued
operations.

2. Summary of Significant Accounting Policies

Basis of PresentationThe consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany
balances and transactions have been eliminated. We view each property as an operating segment and all such operating segments have been aggregated into one reporting segment.

Discontinued
operations include our formerly wholly owned casinos; in Dudley and Wolverhampton, England sold in November 2009; in Freeport; Grand Bahamas exited in November 2009; and in
Coventry, England sold in April 2009.

Fiscal Year-EndOur fiscal year ends on the last Sunday in April. Periodically, this system necessitates a 53-week year.
Fiscal years 2010, 2009 and 2008 are all 52-week years, which commenced on April 27, 2009, April 28, 2008, and April 30, 2007, respectively.

ReclassificationsCertain reclassifications of prior year presentations have been made to conform to fiscal 2010 presentation.

Use of EstimatesThe preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.

Cash and Cash EquivalentsWe consider all highly liquid investments purchased with an original maturity of three months or less as cash equivalents.
Cash also includes the minimum operating cash balances required by state regulatory bodies, which totaled $20,846 and $22,507 at April 25, 2010 and April 26, 2009, respectively.

Marketable SecuritiesMarketable securities consist primarily of trading securities primarily held by Capri Insurance Corporation, our captive
insurance subsidiary. The trading securities are primarily debt and equity securities that are purchased with the intention to resell in the near term. The trading securities are carried at fair value
with changes in fair value recognized in current period income in the accompanying statements of operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (Continued)

InventoriesInventories are stated at the lower of weighted average cost or market value.

Property and EquipmentProperty and equipment are stated at cost or if acquired through acquisition, the value as determined under purchase
accounting. Assets subject to impairment write downs are recorded at the lower of net book value or fair value. We capitalize the cost of purchases of property and equipment and capitalize the cost of
improvements to property and equipment that increases the value or extends the useful lives of the assets. Costs of normal repairs and maintenance are charged to expense as incurred.

Depreciation
is computed using the straight-line method over the following estimated useful lives of the assets:

YearsSlot machines, software and computers

3 - 5Furniture, fixtures and equipment

5 - 10Leasehold improvements

Lesser of life of lease or
estimated useful lifeBuildings and improvements

7 - 39.5


Certain
property currently leased in Bettendorf, Iowa and property formerly leased in Coventry, England, prior to the termination of such lease, are accounted for in accordance with
Accounting Standards Codification ("ASC") Topic 840, Leases ("ASC 840").

Capitalized InterestThe interest cost associated with major development and construction projects is capitalized and included in the cost of the
project. When no debt is incurred specifically for a project, interest is capitalized on amounts expended on the project using the weighted-average cost of our outstanding borrowings. Capitalization
of interest ceases when the project is substantially complete or development activity is suspended for more than a brief period. Capitalized interest was $75, $1,018, and $3,335 for fiscal years 2010,
2009 and 2008, respectively, including capitalized interest relating to our discontinued operations of $943 for fiscal 2008.

Operating LeasesWe recognize rent expense for each lease on the straight line basis, aggregating all future minimum rent payments including any
predetermined fixed escalations of the minimum rentals. Our liabilities include the aggregate difference between rent expense recorded on the straight-line basis and amounts paid under the
leases.

Restricted CashWe classify cash that is either statutorily or contractually restricted as to its withdrawal or usage as a long term asset due to the
duration of the underlying restriction. Restricted
cash primarily includes amounts related to state tax bonds and other gaming bonds, and amounts held in escrow related to leases.

Goodwill and Other Intangible AssetsGoodwill represents the excess of the cost over the net identifiable tangible and intangible assets of acquired
businesses and is stated at cost, net of impairments, if any. Other intangible assets include values attributable to acquired gaming licenses, customer lists, and trademarks. ASC Topic 350,
IntangiblesGoodwill and Other ("ASC 350") requires these assets be reviewed for impairment at least annually or on an interim basis if indicators of

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (Continued)

impairment
exist. We perform our annual impairment test during our fourth quarter. Goodwill for relevant reporting units is tested for impairment using a discounted cash flow analysis based on
forecasted future results discounted using our weighted average cost of capital and by using a market approach based upon valuation multiples for similar companies. For intangible assets with
indefinite lives not subject to amortization, we review, at least annually, the continued use of an indefinite useful life. If these intangible assets are determined to have a finite useful life, they
are amortized over their estimated remaining useful lives.

Long-Lived AssetsWe periodically evaluate the carrying value of long-lived assets to be held and used in accordance with ASC
Topic 360, Property, Plant and Equipment ("ASC 360") which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and
the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount
exceeds the fair market value of the long-lived assets.

Deferred Financing CostsThe costs of issuing long-term debt are capitalized and amortized using the effective interest method over the
term of the related debt.

Self-InsuranceWe are self-funded up to a maximum amount per claim for employee-related health care benefits, workers'
compensation and general liabilities. Claims in excess of this maximum are fully insured through a stop-loss insurance policy. We accrue for workers' compensation and general liabilities
on a discounted basis based on claims filed and estimates of claims incurred but not reported. The estimates have been
discounted at 2.0% and 4.1% at April 25, 2010 and April 26, 2009, respectively. We utilize independent consultants to assist in the determination of estimated liabilities. As of
April 25, 2010 and April 26, 2009, our employee-related health care benefits program and discounted workers' compensation and general liabilities for unpaid and incurred but not reported
claims are $32,739 and $29,001, respectively and are included in Accrued liabilitiespayroll and related for health care benefits and workers' compensation liabilities and in Accrued
liabilitiesother for general liability in the accompanying consolidated balance sheets. While the total cost of claims incurred depends on future developments, in management's opinion,
recorded reserves are adequate to cover future claims payments.

Derivative Instruments and Hedging ActivitiesASC Topic 815, Derivatives and Hedging ("ASC 815") requires we recognize all of our derivative
instruments as either assets or liabilities in the consolidated balance sheet at fair value and disclose certain qualitative and quantitative information. We utilize derivative financial instruments
to manage interest rate risk associated with a portion of our variable rate borrowings. Derivative financial instruments are intended to reduce our exposure to interest rate volatility. We account for
changes in the fair value of a derivative instrument depending on the intended use of the derivative and the resulting designation, which is established at the inception of a derivative. ASC 815
requires that a company formally document, at the inception of a hedge, the hedging relationship and the entity's risk management objective and strategy for undertaking the hedge, including
identification of the hedging instrument, the hedged item or transaction, the nature of the risk being hedged, the method used to assess effectiveness and the method that will be used to measure hedge
ineffectiveness of derivative instruments that receive hedge accounting treatment. For derivative instruments designated as cash flow hedges, changes in fair value, to the extent the hedge is
effective,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (Continued)

are
recognized in other comprehensive income until the hedged item is recognized in earnings and ineffective hedges are recognized as other income or loss below operating income. Hedge effectiveness
is assessed quarterly.

Revenue RecognitionIn accordance with gaming industry practice, we recognize casino revenues as the net win from gaming activities. Casino revenues
are net of accruals for anticipated payouts of progressive slot jackpots and certain table games wherein incremental jackpot amounts owed are accrued for games in which certain wagers add to the
jackpot total. Revenues from rooms, food, beverage, entertainment and the gift shop are recognized at the time the related service or sale is performed or realized.

Promotional AllowancesThe retail value of rooms, food and beverage and other services furnished to guests without charge is included in gross
revenues and then deducted as promotional
allowances to arrive at net revenues included in the accompanying consolidated statement of operations. We also record the redemption of coupons and points for cash as a promotional allowance. The
estimated cost of providing such complimentary services from continuing operations are included in casino expense in the accompanying consolidated statements of operations are as follows:

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Rooms

$
9,533

$
8,830

$
10,366Food and beverage


57,796


57,251


58,571Other


833


534


585Total cost of complimentary services

$
68,162

$
66,615

$
69,522


Players Club AwardsWe provide patrons with rewards based on the dollar amount of play on casino games. A liability has been established based on an
estimate of the value of these outstanding rewards, utilizing the age and prior history of redemptions.

AdvertisingAdvertising costs are expensed the first time the related advertisement appears. Total advertising costs, including direct mail costs,
from continuing operations were $32,981, $27,496, and $29,143 in fiscal years 2010, 2009 and 2008, respectively.

Development CostsWe pursue development opportunities for new gaming facilities in an ongoing effort to expand our business. In accordance with ASC
Topic 720, Other Expenses ("ASC 720), costs related to projects in the development stage are recorded as a development expense, except for those costs capitalized in accordance with the guidance of
ASC 720. Capitalized development costs are expensed when the development is deemed less than probable. Total development costs expensed from continuing operations were recorded in the consolidated
statements of operations in corporate and development expenses.

Pre-Opening CostsWe expense pre-opening costs as incurred. Pre-opening costs include payroll, outside services,
advertising, insurance, utilities, travel and various other expenses related to new operations. All such costs are recorded in the consolidated statements of operations in pre-opening.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (Continued)

Pre-opening
expenses from continuing operations in our consolidated financial statements were incurred in connection with the opening of Waterloo in fiscal 2008.

Income TaxesWe account for income taxes in accordance ASC Topic 740, Income Taxes ("ASC 740"). ASC 740 requires the recognition of deferred
income tax assets, net of valuation allowances related to net operating loss carry forwards and certain temporary differences. Recognizable future tax benefits are subject to a valuation reserve,
unless such tax benefits are determined to be more likely than not realizable. We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense.

Earnings (Loss) Per Common ShareIn accordance with the guidance of ASC 260, Earnings Per Share ("ASC 260"), basic earnings (loss) per share ("EPS")
is computed by dividing net income (loss) applicable to common stock by the weighted average common shares outstanding during the period. Diluted EPS reflects the additional dilution for all
potentially dilutive securities such as stock options. Any options with an exercise price in excess of the average market price of our common stock during the periods presented are not considered when
calculating the dilutive effect of stock options for diluted earnings per share calculations.

Stock CompensationOur stock compensation is accounted for in accordance with ASC Topic 718, CompensationStock Compensation ("ASC 718").
Stock compensation cost is measured at the grant date, based on the estimated fair value of the award and is recognized as expense on a straight-line basis over the requisite service
period for each separately vesting portion of the award as if the award was, in-substance, multiple awards.

Foreign Currency TranslationWe account for currency translation in accordance with ASC Topic 830, Foreign Currency Matters ("ASC 830"). Assets
and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect at each balance sheet date. Statement of operations accounts are translated monthly at
the average rate of exchange prevailing during the period. Translation adjustments resulting from this process are included in stockholders' equity as accumulated other comprehensive (loss) income.
The cumulative loss from foreign currency translation included in other comprehensive loss is ($133) and ($359) as of April 25, 2010 and April 26, 2009, respectively. Losses from foreign
currency transactions are included in income (loss) from discontinued operations and were $0, ($2) and ($356) in fiscal years 2010, 2009 and 2008, respectively.

Allowance for Doubtful AccountsWe reserve for receivables that may not be collected. Methodologies for estimating the allowance for doubtful accounts
range from specific reserves to various percentages applied to aged receivables. Historical collection rates are considered, as are customer relationships, in determining specific reserves.

Fair Value MeasurementsWe follow the guidance of ASC Topic 820, Fair Value Measurements and Disclosures ("ASC 820") for our financial assets and
liabilities including marketable securities and derivative instruments. ASC 820 provides a framework for measuring the fair value of financial assets

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (Continued)

and
liabilities. A description of the valuation methodologies used to measure fair value, key inputs, and significant assumptions follows:



Subsequent EventsThe Company evaluated all subsequent events through the date the consolidated financial statements were issued. (See Note 21).

Recently Issued Accounting StandardsNew PronouncementsIn June 2009, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standard ("SFAS") No. 168, "TheFASB Accounting Standards CodificationTMand the Hierarchy of Generally
Accepted Accounting Principlesa replacement of FASB Statement No. 162", which identifies the sources of accounting principles and the framework for selecting the principles used in
the preparation of financial statements of nongovernmental entities that are presented in conformity with GAAP in the United States (the GAAP hierarchy). SFAS 168 established the FASB Accounting Standards
CodificationTMas the source of authoritative accounting principles recognized by the FASB to be applied by
nongovernmental entities in the preparation of financial statements in conformity with GAAP. SFAS 168 is effective for most financial statements issued for interim and annual periods ending
after September 15, 2009. The adoption of this guidance has changed how we reference various elements of GAAP when preparing our financial statement disclosures, but did not have an impact on
our consolidated financial statements.

In
December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial StatementsAn Amendment of ARB No. 51" ("SFAS 160")
which was codified primarily in ASC Topic 805, Business Combinations ("ASC 805"). SFAS 160 changes the accounting for noncontrolling (minority) interests in consolidated financial statements,
requires noncontrolling interests to be reported as part of equity and changes the income statement presentation of income or losses attributable to the noncontrolling interests. We adopted
SFAS 160 as of April 27, 2009, as required. The adoption of SFAS 160 did not have a material impact on our consolidated financial statements.

3. Discontinued Operations

Discontinued operations include our former casinos: Dudley and Wolverhampton, England ("Blue Chip") sold in November 2009, Freeport, Grand Bahamas exited in November 2009; and Coventry,
England sold in April 2009.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

3. Discontinued Operations (Continued)

The
results of our discontinued operations are summarized as follows:

Discontinued Operatons
Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Net revenues

$
7,406

$
27,628

$
33,207Valuation charges





(1,400
)

(78,658
)Pretax (loss) gain on sale of discontinued operations


(617
)

(12,016
)

Pretax (loss) income from discontinued operations


(2,298
)

(27,545
)

(103,138
)Income tax benefit (provision) from discontinued operations


566


9,887


43,902Income (loss) from discontinued operations


(1,732
)

(17,658
)

(59,236
)


During
fiscal 2010, we completed the sale of our Blue Chip casino properties under a plan of administration and have no continuing involvement in its operation. The assets and
liabilities held for sale in our April 26, 2009 balance sheet were sold as a part of this administrative process. The sale of
our Blue Chip assets resulted in a pretax charge of $617 recorded in fiscal 2010. The administration process is expected to be completed during fiscal 2011.

During
fiscal 2009, we recorded a pretax charge of $1,400 to reduce our Blue Chip assets held for sale to their estimated fair value less the cost to sell and we completed the sale of
our assets and terminated our lease in the Arena Coventry Convention Center relating to our casino operations in Coventry, England. Our lease termination costs and other expenses, net of cash proceeds
from our assets sales, resulted in a pretax charge of $12,016 recorded in fiscal 2009.

During
fiscal 2008, we recorded impairment charges at our United Kingdom ("UK") properties based upon a review of expected future operating trends and the current fair value of our
long-lived assets. The current fair values used in our determination of the impairment charge were based upon a third party appraisal, a review of historical costs and other relevant
information.

Net
interest income (expense) of $8, ($1,972), and ($1,907) for fiscal years 2010, 2009, and 2008, respectively, has been allocated to discontinued operations. Interest expense allocated
to our former international operations was based upon long term debt and other long-term obligations specific to such operations as these entities are not guarantors under our senior
secured credit facility.

4. Acquisitions

Acquisition of Minority Interest in Black Hawk, Colorado OperationsDuring January 2009, we finalized our purchase accounting for our January 2008
acquisition of the 43% minority membership interest in our Black Hawk, Colorado subsidiaries. During January 2008, a preliminary allocation of the $64,800 purchase price, including transaction costs
and after consideration of minority interest of $29,819, was made by us based upon the estimated fair value of the purchased assets and assumed liabilities. This preliminary purchase price allocation
resulted in values being assigned of $14,000 to property and equipment, $10,600 to other intangible assets and $10,381 to goodwill. After completion of third party valuations of the assets acquired,
the final purchase price allocation included a $8,331 reduction in the acquired historical cost basis in property and final allocation amounts of $20,855 for

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

4. Acquisitions (Continued)

intangible
assets, $411 for other liabilities and $22,868 in goodwill. The intangible assets included $2,021 of trademarks and $4,257 related to our gaming licenses both with indefinite lives, as well
as $14,577 relating to customers lists with a 4 year life. Goodwill resulting from our acquisition of this minority interest is deductible for tax purposes. We accounted for the purchase using
the purchase method of accounting in accordance with ASC 805.

5. Property and Equipment, Net

Property and equipment, net consists of the following:

April 25,
2010

April 26,
2009Property and equipment:Land and land improvements

$
159,442

$
159,574Leasehold improvements


335,456


332,762Buildings and improvements


646,811


649,020Riverboats and floating pavilions


144,470


142,715Furniture, fixtures and equipment


508,177


516,523Construction in progress


11,458


12,537Total property and equipment


1,805,814


1,813,131Less accumulated depreciation and amortization


(706,872
)

(635,591
)Property and equipment, net

$
1,098,942

$
1,177,540


6. Intangible Assets and Goodwill

Intangible assets consist of the following:

April 25, 2010

April 26, 2009Gross
Carrying
Amount

Accumulated
Amortization

Net
Carrying
Amount

Gross
Carrying
Amount

Accumulated
Amortization

Net
Carrying
AmountIndefinite-lived assetsGaming licenses

$
66,126

$


$
66,126

$
66,126

$


$
66,126Trademarks


7,149





7,149


7,149





7,149Intangible assetssubject to amortizationCustomer lists


15,384


(8,984
)

6,400


15,384


(5,071
)

10,313Total

$
88,659

$
(8,984
)
$
79,675

$
88,659

$
(5,071
)
$
83,588


Our
indefinite-lived intangible assets consist primarily of gaming licenses and trademarks for which it is reasonably assured that we will continue to renew indefinitely. Our
finite-lived assets consist of customer lists amortized over 3 to 4 years. The weighted average remaining life of our other intangible assets subject to amortization is approximately
1.7 years.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

6. Intangible Assets and Goodwill (Continued)

We recorded amortization expense of $3,913, $4,624, and $549 for our intangible assets subject to amortization related to our continuing operations for the fiscal years ended 2010, 2009,
and 2008, respectively.

Future
amortization expense of our amortizable intangible assets is as follows:

2011

$
3,6662012


2,734Total

$
6,400


A
roll forward of goodwill is as follows:

April 25,
2010

April 26,
2009Balance, beginning of period

$
313,136

$
307,649Acquisition of minority interest in Black Hawk, Colorado operations





12,487Impairment





(7,000
)Balance, end of period

$
313,136

$
313,136


During
fiscal 2009, we recorded a pretax impairment charge of $7,000 for goodwill related to our Black Hawk, Colorado property.

7. Expense Recoveries and Other Charges, net

We recorded pretax expense recoveries and other charges from continuing operations as follows:

Fiscal 2010We recorded an expense recovery of $6,762 representing the discounted value of a receivable for reimbursement of development costs
expended in prior periods relating to a terminated plan to develop a casino in Pittsburgh, Pennsylvania. This receivable was recorded following a revised assessment of collectability.

Fiscal 2009An impairment charge of $18,269 was recorded at our Black Hawk, Colorado property as a result of our annual impairment test required under
ASC 350. The Black Hawk impairment charge included $7,000, $7,072 and $4,197 related to goodwill, trademarks and gaming licenses, respectively. Fair values were determined using methods as follows:
discounted cash flow and multiples of earnings for goodwill, relief from royalty method for trademarks; and the cost approach for the gaming license. The impairment was a result of decreased operating
performance caused by a smoking ban which became effective in January, 2009 and declines in the economy resulting in lower market valuation multiples for gaming assets and higher discount rates.

Following
our decision not to complete our construction plan as originally designed for our Biloxi property, we recorded a valuation charge of $11,856 to construction in progress.

Following
our termination of an agreement for a potential development of a casino project in Portland Oregon, we recorded a $6,000 charge consisting of a non-cash
write-off of $5,000 representing

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

7. Expense Recoveries and Other Charges, net (Continued)

our
rights under a land option and $1,000 termination fee. Under the terms of the agreement, we retain certain rights but no continuing obligations with regard to this development project.

Fiscal 2008We recorded valuation charges of $6,526 related to the termination of the Company's plans to develop a new casino in west Harrison County,
Mississippi and the cancellation of construction projects in Davenport, Iowa and Kansas City, Missouri.

8. Long-Term Debt

Long-term debt consists of the following:

April 25,
2010

April 26,
2009Senior Secured Credit Facility:July 2007 Credit Facility:Revolving line of credit, expires July 26, 2012, interest payable at least quarterly at either LIBOR and/or prime plus a margin

$
21,500

$
112,000Variable rate term loans, mature November 25, 2013, principal and interest payments due quarterly at either LIBOR and/or prime plus a
margin


817,256


825,651Senior Subordinated Notes:7% Senior Subordinated Notes, interest payable semi-annually March 1 and September 1


357,275


357,275Other


4,858


6,1461,200,889


1,301,072Less current maturities


8,754


9,688Long-term debt

$
1,192,135

$
1,291,384


Credit Facility, as amendedThe Credit Facility as amended ("Credit Facility") consists of a $375,000 revolving line of credit and a $875,000 term
loan. The Credit Facility is secured on a first priority basis by substantially all of our assets and guaranteed by all of our significant domestic subsidiaries.

Our
Credit Facility was amended on February 17, 2010. The amendment, among other things, (1) modified the leverage ratio and interest coverage ratio to provide for greater
flexibility through April 30, 2012, after which date the ratios return to the original levels as outlined in the Credit Facility; (2) reduced the capacity of the revolving line of credit
by $100,000 to $375,000; (3) increased the interest rate of both the revolving line of credit and term loan portions to LIBOR + 3.00% with a LIBOR floor of 2.00%; and
(4) allows us to issue senior unsecured notes, provided the proceeds are used to repay the term loan under the Credit Facility. As a result of the amendment, we incurred a charge of
approximately $2,143 related to fees and the write-off of certain unamortized deferred financing costs, of which approximately $309 was non-cash and recorded deferred financing
costs of $3,874.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

8. Long-Term Debt (Continued)

Our
net line of credit availability at April 25, 2010 as limited by our maximum leverage covenant was approximately $109,000, after consideration of $20,449 in outstanding letters
of credit. We have an annual commitment fee related to the unused portion of the Credit Facility of up to 0.75% which is included in Interest expense in the accompanying consolidated statements of
operations. The weighted average effective interest rates of the Credit Facility for the fiscal years 2010 and 2009 were 4.83% and 5.33%, respectively.

The
Credit Facility includes a number of affirmative and negative covenants. Additionally, we must comply with certain financial covenants including maintenance of a leverage ratio and
minimum interest coverage ratio. The Credit Facility also restricts our ability to make certain investments or distributions. We are in compliance with the covenants as of April 25, 2010.

7% Senior Subordinated NotesDuring 2004, we issued $500,000 of 7% Senior Subordinated Notes due 2014 ("7% Senior Subordinated Notes"). The 7% Senior
Subordinated Notes are guaranteed, on a joint and several basis, by all of our significant domestic subsidiaries and certain other subsidiaries as described in Note 18. All of the guarantor
subsidiaries are wholly owned by us. The 7% Senior Subordinated Notes are general unsecured obligations and rank junior to all of our senior indebtedness. The 7% Senior Subordinated Notes are
redeemable, in whole or in part, at our option at
any time on or after March 1, 2009, with call premiums as defined in the indenture governing the 7% Senior Subordinated Notes.

The
indenture governing the 7% Senior Subordinated Notes limits, among other things, our ability and our restricted subsidiaries ability to borrow money, make restricted payments, use
assets as security in other transactions, enter into transactions with affiliates, pay dividends, or repurchase stock. The indenture also limits our ability to issue and sell capital stock of
subsidiaries, sell assets in excess of specified amounts or merge with or into other companies.

Gain (Loss) on Early Extinguishment of DebtDuring February 2009, we retired $142,725 of the 7% Senior Subordinated Notes, through a tender offer, for
$82,773 from our available Cash and cash equivalents. After expenses related to the elimination of deferred finance costs and transactions costs, we recognized a pretax gain of $57,892 during fiscal
2009. During March 2009, we repaid $35,000 of our term loans under our Credit Facility resulting in a loss on early extinguishment of debt of $199 due to the write-off of deferred
financing cost.

During
fiscal 2008, we recorded a total of $15,274 in losses associated with the redemption of $200,000 of 9% Senior Subordinated Notes refinanced by our Credit Facility and the
replacement of our previous credit facility with the Credit Facility and the early extinguishment of other debt instruments.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

8. Long-Term Debt (Continued)

Future Principal Payments of Long-term DebtThe aggregate principal payments due on long-term debt as of April 25, 2010
over the next five years and thereafter, are as follows:

Fiscal Years Ending:2011

$
8,7542012


8,7682013


30,2882014


1,149,7552015


439Thereafter


2,885Total

$
1,200,889


9. Other Long-Term Obligations

Quad Cities Waterfront Convention CenterWe entered into agreements with the City of Bettendorf, Iowa under which the City constructed a convention
center which opened in January 2009,
adjacent to our hotel. We lease, manage, and provide financial and operating support for the convention center. The Company was deemed, for accounting purposes only, to be the owner of the convention
center during the construction period. Upon completion of the convention center we were precluded from accounting for the transaction as a sale and leaseback due to our continuing involvement.
Therefore, we are accounting for the transaction using the direct financing method. As of April 25, 2010 and April 26, 2009, we have recorded in other long-term obligations
$17,166 and $17,314, respectively, related to our liability under ASC 840 related to the convention center. Under the terms of our agreements for the convention center, we have guaranteed certain
obligations related to $13,815 of notes issued by the City of Bettendorf, Iowa for the convention center.

The
other long term obligation will be reflected in our consolidated balance sheets until completion of the lease term, at which time the related fixed assets, net of accumulated
depreciation, will be removed from our consolidated financial statements and the net remaining obligation over the net carrying value of the fixed asset will be recognized as a gain (loss) on sale of
the facility.

Future
minimum payments due under other long-term obligations, including interest, as of April 25, 2010 as follows:

Fiscal Years Ending:2011

$
1,1002012


1,1002013


1,1002014


1,2672015


1,600Thereafter


17,536Total minimum payments

$
23,703


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

10. Common Stock

Earnings per Share of Common StockThe following table sets forth the computation of basic and diluted earnings (loss) per share (in thousands, except
share and per share amounts):

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Numerator:Income (loss) applicable to common shares:Income (loss) from continuing operations attributable to common stockholders

$
(1,541
)
$
61,233

$
(37,638
)Loss from discontinued operations


(1,732
)

(17,658
)

(59,236
)Net income (loss) attributable to the common stockholders

$
(3,273
)
$
43,575

$
(96,874
)Denominator:Denominator for basic earnings (loss) per shareweighted average shares


32,245,769


31,372,670


30,699,457Effect of dilutive securitiesEmployee stock options





6,346


Denominator for diluted earnings (loss) per shareadjusted weighted average shares and assumed conversions


32,245,769


31,379,016


30,699,457Basic earnings (loss) per share attributable to common stockholdersIncome (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)Loss from discontinued operations


(0.05
)

(0.56
)

(1.92
)Net income (loss) attributable to common stockholders

$
(0.10
)
$
1.39

$
(3.16
)Diluted earnings (loss) per share attributable to common stockholdersIncome (loss) from continuing operations

$
(0.05
)
$
1.95

$
(1.24
)Loss from discontinued operations


(0.05
)

(0.56
)

(1.92
)Net income (loss) attributable to common stockholders

$
(0.10
)
$
1.39

$
(3.16
)


Due
to the loss from continuing operations, stock options representing 116,511 shares, which are potentially dilutive, and 495,474 shares, which are anti-dilutive, were
excluded from the calculation of common shares for diluted earnings (loss) per share for fiscal 2010. Stock options representing 1,520,040 and 3,872,513 shares, which were antidilutive, were excluded
from the calculation of common shares for diluted earnings (loss) per share for fiscal 2009 and 2008, respectively.

Stock Based CompensationUnder our amended and restated Long Term Incentive Plan, we have issued stock options and restricted stock.

Stock OptionsWe have issued incentive stock options and nonqualified stock options which have a maximum term of 10 years and are, generally,
exercisable in yearly installments of 20% commencing

63

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

10. Common Stock (Continued)

one
year after the date of grant. During fiscal 2010, our estimate of forfeitures increased to 12%. The impact of these changes in estimated forfeitures decreased expense by $737 and was recorded as a
cumulative adjustment in the consolidated statements of operations for fiscal 2010.

The
fair value of each option grant is estimated on the date of the grant using the Black-Scholes-Merton option-pricing model with the range of assumptions disclosed in the following
table:

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Weighted average expected volatility


67.86
%

42.29
%

43.02
%Expected dividend yield


0.00
%

0.00
%

0.00
%Weighted average expected term (in years)


7


6.79


6.79Weighted average risk-free interest rate


3.07
%

3.50
%

3.94
%Weighted average fair value of options granted

$
7.53

$
2.73

$
7.72


Weighted
average volatility is calculated using the historical volatility of our stock price over a range of dates equal to the expected term of a grant's options. The weighted average
expected term is calculated using historical data that is representative of the option for which the fair value is to be determined. The expected term represents the period of time that options
granted are expected to be outstanding. The weighted average risk-free rate is based on the U.S. Treasury yield curve in effect at the time of the grant for the approximate period of time
equivalent to the grant's expected term.

Tender OfferOn October 7, 2008, we completed a tender offer whereby certain employees and directors exchanged 2,067,201 of then outstanding
stock options for 293,760 shares of restricted common stock and the payment of $155 in cash to eligible participants in accordance with the terms of the tender offer. Restricted shares issued as part
of the tender offer vest three years from the date of issuance. During fiscal 2010, our estimate of forfeitures decreased from 20.8% to 7.7%. The impact of these changes in estimated forfeitures
increased expense by $384 and was recorded as a cumulative adjustment in the consolidated statements of operations for fiscal 2010.

Restricted StockWe issue shares of restricted common stock to employees and directors under our Long Term Incentive Plan. Restricted stock awarded to
employees vests one-third on each anniversary of the grant date and for directors vests one-half on the grant date and one-half on the first anniversary of the
grant date. Our estimate of forfeitures for restricted stock for employees and directors is 10% and 0%, respectively.

Stock Compensation ExpenseTotal stock compensation expense from continuing operations in the accompanying consolidated statements of operations was
$7,628, $7,103, and $7,263 for the fiscal years 2010, 2009, and 2008, respectively. We recognize compensation expense for these awards on a straight-line basis over the requisite service
period for each separately vesting portion of the award.

64

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

10. Common Stock (Continued)

Activity Under Our Share Based PlansA summary of restricted stock and option activity for fiscal 2010 is presented below:

Restricted
Stock

Weighted
Average
Grant-Date
Fair Value

Options

Weighted
Average
Exercise
PriceOutstanding at April 26, 2009


761,530

$
5.55


1,520,040

$
12.30Granted


647,861


12.63


100,000


11.25Exercised








(21,602
)

9.47Vested


(306,700
)

7.00


Forfeited and expired


(23,974
)

7.16


(163,253
)

20.94Outstanding at April 25, 2010


1,078,717


9.35


1,435,185

$
11.29As of April 25, 2010:Outstanding exercisable options


n/a





760,585

$
13.36Weighted average remaining contractual term


1.2 years





6.5 yearsAggregate intrinsic value:Outstanding exercisable


n/a




$
4.15Outstanding

$
9.35




$
3.84Nonvested:Unrecognized compensation cost

$
5,999




$
1,437Weighted average remaining vesting period


1.2 years





3.1 years


Additional
information relating to our share based plans is as follows:

April 25,
2010

April 26,
2009

April 27,
2008Restricted Stock:Fair value of restricted stock vested during the year

$
2,146

$
512

$
Stock Options:Intrinsic value of stock options exercised


30


141


5,423Income tax benefit from stock options exercised








977Proceeds from stock option exercises


204


110


4,770


We
have 2,220,296 shares available for future issuance under our equity compensation plan as of April 25, 2010. Upon issuance of restricted shares or exercise of stock options,
shares may be issued from available treasury or common shares.

Stock-Based CompensationDeferred Bonus PlanOur stockholders have approved the Deferred Bonus Plan which provides for the issuance of
non-vested stock to eligible officers and employees who agree to receive a deferred bonus in the form of non-vested stock. The vesting of the stock is dependent upon continued
service to the Company for a period of five years and the fair value of the non-vested stock at the grant date is amortized ratably over the vesting period. Compensation expense related to
stock-based compensation under the Deferred Bonus Plan for fiscal years 2010, 2009, and 2008 totaled $100, $175, and $265, respectively. We do not plan to award any further compensation

65

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

10. Common Stock (Continued)

under
the Deferred Bonus Plan, however, any grants that have been awarded prior to the Deferred Bonus Plan's discontinuation will be paid provided the vesting requirements are met.

A
summary of activity for fiscal 2010 under the deferred bonus plan is as follows:

Number
of
Shares

Weighted
Average
Grant Date
Fair ValueNon-vested stock at April 26, 2009


29,701

$
22.86Shares granted





Shares vested


(14,859
)

18.60Shares forfeited


(4,196
)

26.05Non-vested stock at April 25, 2010


10,646

$
27.54


The
total weighted average fair value of shares vested related to the Deferred Bonus Plan for fiscal years 2010, 2009, and 2008 was $276, $515, and $873, respectively.

Stock RepurchaseOur Board of Directors has approved a stock repurchase program, as amended, allowing up to 6,000,000 shares of our common stock to be
repurchased. As of April 25, 2010, we have repurchased 4,895,792 shares of common stock, and retired 553,800 shares of common stock under this stock repurchase program. No shares were
repurchased in fiscal years 2010, 2009 or 2008.

11. Deferred Compensation Plans

2005 Deferred Compensation PlanOur 2005 Deferred Compensation Plan (the "Plan"), as amended and restated, is an unfunded deferred compensation
arrangement for the benefit of key management officers and employees of the Company and its subsidiaries. The terms of the Plan include the ability of the participants to defer, on a
pre-tax basis, salary, and bonus payments in excess of the amount permitted under IRS Code Section 401(k). The terms also allow for a discretionary annual matching contribution by
the Company. The Plan allows for the aggregation and investment of deferred amounts in notional investment alternatives, including units representing shares of our common stock. The liability related
to the Plan as of April 25, 2010 and April 26, 2009 was $3,069 and $2,726, respectively, and is included in long-term other accrued liabilities in the consolidated balance
sheets. Expense for our contributions related to the Plan was $83, $104 and $85 in fiscal years 2010, 2009 and 2008, respectively.

12. Supplemental Disclosure of Cash Flow Information

For the fiscal years 2010, 2009 and 2008 we made cash payments for interest, net of capitalized interest of $71,623, $90,706, and $108,090, respectively. We collected an income tax
refund net of payments of $1,561 and $20,164 for fiscal years 2010 and 2009, respectively. We paid income taxes, net of refunds, of $7,949 in fiscal 2008.

For
fiscal 2009, we purchased property and equipment financed with a long term obligation of $14,384 as discussed in Note 9. Also for the fiscal year ended April 27, 2008,
we purchased land financed with a note payable for $3,096.

66

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

13. Income Taxes

Income tax (benefit) provision from continuing operations consists of the following (in thousands):

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Current:Federal

$
(868
)
$


$
(14,022
)State


718


3,010


(150
)

3,010


(14,022
)Deferred:Federal


(2,976
)

35,309


(5,189
)State


(5,248
)

2,720


(1,707
)(8,224
)

38,029


(6,896
)Income tax (benefit) provision

$
(8,374
)
$
41,039

$
(20,918
)


A
reconciliation of income taxes from continuing operations at the statutory corporate federal tax rate of 35% to the income tax (benefit) provision reported in the accompanying
consolidated statements of operations is as follows (in thousands):

Fiscal Year EndedApril 25,
2010

April 26,
2009

April 27,
2008Statutory tax (benefit) provision

$
(3,469
)
$
35,794

$
(18,720
)Effects of :State taxes


197


5,730


(1,707
)Reduction of unrecognized tax benefits


(4,727
)




OtherVarious permanent differences


537


1,302


1,586Employment tax credits


(784
)

(1,333
)

(1,351
)Noncontrolling interest








(1,943
)Qualified stock option expense (benefit)


(240
)

644


814Other


112


(1,098
)

403Income tax (benefit) provision

$
(8,374
)
$
41,039

$
(20,918
)


67

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

13. Income Taxes (Continued)

Significant
components of our domestic net deferred income tax asset (liability) are as follows (in thousands):

Fiscal Year EndedApril 25,
2010

April 26,
2009Deferred tax liabilities:Property and equipment

$
(83,830
)
$
(85,122
)Gain on early extinguishment of debt


(22,416
)

(22,450
)Other


(8,696
)

(8,583
)Total deferred tax liabilities


(114,942
)

(116,155
)Deferred tax assets:Accrued expenses


11,289


17,111Alternative minimum tax credit


1,696


3,610Employment tax credits


15,893


13,609Capital loss carryover


1,576


1,576Net operating losses


71,723


63,959Other


9,951


17,702Total deferred tax assets


112,128


117,567Valuation allowance on deferred tax assets


(9,553
)

(10,087
)Net deferred tax asset


102,575


107,480Net deferred tax asset/(liability)

$
(12,367
)
$
(8,675
)


At
April 25, 2010, we have federal net operating loss carryforwards of $173,521 for income tax purposes, with expiration dates from fiscal 2011 to 2030. Approximately $41,882 of
these net operating losses are attributable to IC Holdings Colorado, Inc. and its wholly-owned subsidiary CCSC/Blackhawk, Inc. ("IC Holdings, Inc. & Sub") and can only be
used to offset income earned by these entities. The remaining federal net operating losses are subject to limitations under the internal revenue code and underlying treasury regulations, which may
limit the amount ultimately utilized; however, we believe that all federal net operating losses will be utilized prior to expiration. IC Holdings, Inc. & Sub also has a federal capital
loss carryforward of $4,146 that expires in 2011 for which it has established a full valuation allowance because it does not expect to benefit from the capital loss. We also have various state income
tax net operating loss carryforwards totalling $237,010 with expiration dates from fiscal 2011 to 2030. We have determined that it is more likely than not that we will not be able to utilize $160,483
of the state income tax net operating losses and have established valuation reserves accordingly. If or when recognized, the tax benefits relating to any reversal of the valuation allowance on
deferred tax assets as of April 25, 2010 will be accounted for as a reduction of income tax expense. We also have a federal general business credit carryforward of $15,893 for income tax
purposes, which with expiration dates from fiscal 2018 to 2030. We believe that these credits will be utilized prior to expiration. Deferred income taxes related to NOL carryforwards have been
classified as noncurrent to reflect the expected utilization of the carryforwards.

68

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

13. Income Taxes (Continued)

We
account for unrecognized tax benefits in accordance with ASC 740. A reconciliation of the beginning and ending amounts of unrecognized tax benefits as follows:

April 25,
2010

April 26,
2009Beginning Balance

$
19,482

$
21,819Gross increasestax positions in current period





Gross increasestax positions in prior periods





347Gross decreasestax positions in prior periods


(5,254
)

Settlements


(2,102
)

(550
)Lapse of statute of limitations





(2,134
)Ending Balance

$
12,126

$
19,482


Included
in the balance of unrecognized tax benefits at April 25, 2010 are $3,613 of tax benefits that, if recognized, would affect the effective tax rate. Also included in the
balance of unrecognized tax benefits at April 25, 2010 are $6,704 of tax benefits that, if recognized, would result in adjustments to deferred taxes.

We
recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. Related to the unrecognized tax benefits noted above, we recorded interest expense
of ($722), recorded interest income of $2,266 related to prior periods, and settled $1,001 of accrued interest during the fiscal year ended 2010. We accrued no penalties during the fiscal year ended
2010. In total, as of April 25, 2010, we have recognized a liability of $2,826 for interest and no amount for penalties.

We
believe that an increase in unrecognized tax benefits related to federal and state exposures in the coming year, though possible, cannot be reasonably estimated and will not be
significant. In addition, we believe that it is reasonably possible that an amount between $7,700 and $12,100 of our currently remaining unrecognized tax positions may be recognized by the end of the
fiscal year ending April 24, 2011. These amounts relate to positions taken on federal and Mississippi income tax returns for the fiscal years ending April 2002 through April 2008. These amounts
are expected to be resolved during the next twelve months as a result of the anticipated completion of Mississippi income tax examinations and Federal statute expirations.

We
file income tax returns in the U.S. federal jurisdiction and various state jurisdictions. During fiscal 2010, the IRS completed its examination of our federal income tax returns for
the 2006 and 2007 tax years which relate to our fiscal years ended April 29, 2007 and April 27, 2008, respectively. We recorded a tax benefit of $168 in fiscal 2010 related to the
examination. The income tax examination changes are subject to review by the U.S. Congress Joint Committee on Taxation. We expect this review to be completed prior to the end of fiscal 2011. The
statute of limitations expires January 2011 and January 2012, respectively, for the tax years included in the audit. In addition, various state jurisdictions are currently examining our state income
tax returns for various subsidiaries. The tax returns for subsequent years are also subject to examination.

We
file in numerous state jurisdictions with varying statutes of limitations. Our unrecognized state tax benefits are related to state tax returns open from tax years 2001 through 2010
depending on each state's statute of limitations.

69

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

14. Hurricane and Other Insurance Recoveries

During fiscal years 2009 and 2008, we received insurance recoveries related to various claims. These insurance recoveries are from claims filed pertaining to our properties in Biloxi,
Mississippi, Lake Charles, Louisiana and Pompano Beach, Florida, which were struck in the fall of 2005 by Hurricanes Katrina, Rita and Wilma, respectively. Additionally, we received insurance
recoveries relating to flood claims at our Davenport property during fiscal 2009 and at our Natchez property during fiscal years 2008 and 2009.

Business
interruption insurance proceeds are included as revenues under Hurricane and other insurance recoveries in our consolidated statement of operations. Other insurance proceeds,
after collection of insurance receivables are included as a reduction of operating expenses under hurricane and other insurance recoveries in our consolidated statement of operations.

The
significant component of our fiscal 2009 insurance recoveries is the final payment of our $225,000 settlement related to Hurricane Katrina which had damaged our Biloxi, Mississippi
property. As a result of this settlement, we received an additional $95,000 in insurance proceeds. After first applying the proceeds to our remaining insurance receivable, we recognized $92,179 of
pretax income including $60,000 of business interruption proceeds included in net revenues and other insurance recoveries of $32,179 are recorded as a reduction of operating expenses.

15. Employee Benefit Plan

401(k) PlanWe have a 401(k) plan covering substantially all of our employees who have completed 90 days of service. Expense for our
contributions for continuing operations related to the 401(k) plan was $1,465, $1,500, and $741 in fiscal years 2010, 2009, and 2008, respectively. Our contribution is based on a percentage of
employee contributions and may include an additional discretionary amount.

16. Related Party Transactions

A member of the Board of Directors has provided consulting services related to on-going contracts and transactions in the United Kingdom. The total fees paid under this
contract were $0, $10, and $60 in fiscal years 2010, 2009, and 2008, respectively.

In
fiscal 2008 we paid $78 plus expenses to a member of the Board of Directors for consulting services related to certain contracts and real estate transactions.

Effective
February 2010, we amended a lease with an entity owned by certain of our stockholders resulting a payment of $5 per month for a parking area adjacent to one of our casinos.
Prior to this lease amendment, we leased on a month to month basis this parking area and a warehouse for $23 per month.

In
fiscal 2008, we reimbursed a private entity owned by certain of our directors for annual lease payments of approximately $34, for property leased by the private entity. The land was
leased at our request in order to secure sites for possible casino operations.

In
2005, one of our wholly owned subsidiaries, Isle of Capri Bettendorf, L.C., entered into a Development Agreement with the City of Bettendorf, Iowa and Green Bridge Company relating to
the development of a conference/events center in Bettendorf, Iowa, the expansion of the hotel at

70

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

16. Related Party Transactions (Continued)

Bettendorf
and related facilities, including a skywalk between the hotel and conference/events center and a parking facility. Green Bridge Company is indirectly owned by certain of our directors. As
part of the transaction, Isle of Capri Bettendorf, L.C. purchased certain real estate owned by Green Bridge Company at its fair market value of $393 in fiscal 2008. Isle of Capri Bettendorf, L.C. will
hold Green Bridge Company harmless from certain future increases in assessments on adjacent property owned by Green Bridge Company, capped at $4,500.

17. Fair Value Measurements

Interest Rate Hedge AgreementsWe have entered into various interest rate swap agreements pertaining to the Credit Facility for an aggregate notional
value of $400,000 with maturity dates through fiscal 2014. In addition, during the third quarter of fiscal 2010, we entered into an interest rate cap contract with a notional value of $20,000 having a
maturity date in fiscal 2012 and paid a premium of $105 at inception. We entered into these hedging agreements in order to manage market risk on variable rate term loans outstanding, as well as comply
with, in part, requirements under the Credit Facility.

As
a result of the amendment to our Credit Facility in the fourth quarter of 2010, our interest rate swaps no longer meet the criteria for hedge effectiveness, and therefore future
changes in the fair value of the swaps are recorded in other income (expense) in the consolidated statement of operations. As of April 25, 2010, the weighted average fixed LIBOR interest rate
of our interest rate swap agreements was 4.58%. The interest rate cap agreement meets the criteria for hedge accounting for cash flow hedges and has been evaluated, as of April 25, 2010, as
being fully effective. As a result, there is no impact on our consolidated statement of operations from changes in fair value of the interest rate cap.

The
fair value of derivatives included in our consolidated balance sheet and change in our unrealized loss are as follows:

Type of Derivative Instrument

Balance Sheet Location

April 25, 2010

April 26, 2009Interest rate cap contract

Prepaid deposits and other

$
24

$
Interest rate swap contracts

Accrued interest


6,704


2,258Interest rate swap contracts

Other long-term liabilities


6,247


21,454


The
change in unrealized loss on our derivatives was $7,139 and $9,998 for fiscal years 2010 and 2009, respectively.

The
fair value of our interest swap and cap contracts are measured using Level 3 inputs at the present value of all expected future cash flows based on the LIBOR-based yield curve
as of the date of the valuation. The fair value of our interest rate swap contracts as recorded in our consolidated balance sheet is recorded net of deferred income tax benefits of $4,704 and $8,879,
for fiscal years 2010 and 2009, respectively.

The
amount of the gain (loss) reclassified from accumulated other comprehensive income (loss) into earnings and its location in the consolidated statements of income is as follows:

Fiscal Year EndedType of Derivative Instrument

Income
Statement Location

April 25, 2010

April 26, 2009

April 27, 2008Interest rate swap contracts

Interest expense

$
(19,174
)
$
(10,165
)
$
(70
)Other expense


(3,912
)







71

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

17. Fair Value Measurements (Continued)

The Company recorded income of $3,541 in other expense related to the change in fair value of the interest rate swaps no longer qualifying for hedge accounting.

The
amount of accumulated other comprehensive income (loss) related to interest rate swap contracts maturing in the next twelve months was $5,718 as of April 25, 2010.

The
amount of gain (loss) recognized in accumulated other comprehensive income (loss) is as follows:

Fiscal Year EndedType of Derivative Instrument

April 25, 2010

April 26, 2009

April 27, 2008Interest rate cap contracts


(50
)




Interest rate swap contracts


6,955


(6,255
)

(8,555
)Total

$
6,905

$
(6,255
)
$
(8,555
)


A
detail of accumulated other comprehensive income (loss) is as follows:

Type of Derivative Instrument

April 25, 2010

April 26, 2009Interest rate cap contracts

$
(50
)
$
Interest rate swap contracts


(7,877
)

(14,832
)Foreign currency translation gain (loss)


(133
)

(359
)$
(8,060
)
$
(15,191
)


Financial InstrumentsThe estimated carrying amounts and fair values of our other financial instruments are as follows:

April 25, 2010

April 26, 2009Carrying
Amount

Fair Value

Carrying
Amount

Fair ValueFinancial assets:Cash and cash equivalents

$
68,069

$
68,069

$
96,654

$
96,654Marketable securities


22,926


22,926


17,548


17,548Restricted cash


2,774


2,774


2,774


2,774Notes receivable


3,000


3,000


3,000


3,000Financial liabilities:Revolver

$
21,500

$
20,855

$
112,000

$
112,000Variable rate term loans


817,256


800,911


825,651


652,2647% Senior subordinated notes


357,275


326,013


357,275


262,597Other long-term debt


4,858


4,858


6,146


6,146Other long-term obligations


17,166


17,166


17,314


17,314


72

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

17. Fair Value Measurements (Continued)

The
following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:



18. Consolidating Condensed Financial Information

Certain of our wholly owned subsidiaries have fully and unconditionally guaranteed on a joint and several basis, the payment of all obligations under our 7% Senior Subordinated Notes.

The
following wholly owned subsidiaries of the Company are guarantors, on a joint and several basis, under the 7% Senior Subordinated Notes: Black Hawk Holdings, L.L.C.; Casino America
of Colorado, Inc.; CCSC/Blackhawk, Inc.; Grand Palais Riverboat, Inc.; IC Holdings Colorado, Inc.; IOC-Black Hawk Distribution Company, L.L.C.;
IOC-Boonville, Inc.; IOC-Caruthersville, L.L.C.; IOC-Kansas City, Inc.; IOC-Lula, Inc.; IOC-Natchez, Inc.;
IOC-Black Hawk County, Inc.; IOC-Davenport, Inc.; IOC Holdings, L.L.C.; IOC Services, L.L.C.; Isle of Capri Bahamas Holdings, Inc.; Isle of Capri
Bettendorf Marina Corporation.; Isle of Capri Bettendorf, L.C; Isle of Capri Black Hawk Capital Corp.; Isle of Capri Black Hawk, L.L.C.; Isle of Capri Marquette, Inc.; P.P.I, Inc.;
Riverboat Corporation of Mississippi; Riverboat Services, Inc.; and St. Charles Gaming Company, Inc. Each of the subsidiaries' guarantees is joint and several with the guarantees
of the other subsidiaries.

73

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)

Consolidating
condensed balance sheets as of April 25, 2010 and April 26, 2009 are as follows (in thousands):

As of April 25, 2010Balance Sheet

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedCurrent assets

$
35,835

$
71,976

$
43,193

$
(1,100
)
$
149,904Intercompany receivables


990,557


(185,612
)

(54,177
)

(750,768
)

Investments in subsidiaries


390,369


(63,110
)




(327,259
)

Property and equipment, net


7,579


1,059,147


32,216





1,098,942Other assets


57,092


409,106


11,150


(51,354
)

425,994Total assets

$
1,481,432

$
1,291,507

$
32,382

$
(1,130,481
)
$
1,674,840Current liabilities

$
46,581

$
80,884

$
30,790

$
(1,100
)
$
157,155Intercompany payables





750,768





(750,768
)

Long-term debt, less current maturities


1,187,631


3,760


744





1,192,135Other accrued liabilities


7,001


116,815


12,869


(51,354
)

85,331Stockholders' equity


240,219


339,280


(12,021
)

(327,259
)

240,219Total liabilities and stockholders' equity

$
1,481,432

$
1,291,507

$
32,382

$
(1,130,481
)
$
1,674,840




As of April 26, 2009Balance Sheet

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedCurrent assets

$
38,145

$
95,971

$
45,772

$
(2,295
)
$
177,593Intercompany receivables


1,145,395


(257,297
)

(97,536
)

(790,562
)

Investments in subsidiaries


333,012


(58,041
)




(274,971
)

Property and equipment, net


10,158


1,134,553


32,829





1,177,540Other assets


53,805


415,013


8,021


(49,310
)

427,529Total assets

$
1,580,515

$
1,330,199

$
(10,914
)
$
(1,117,138
)
$
1,782,662Current liabilities

$
40,440

$
97,576

$
32,272

$
(2,295
)
$
167,993Intercompany payables





790,562





(790,562
)

Long-term debt, less current maturities


1,286,526


3,995


863





1,291,384Other accrued liabilities


25,123


106,976


12,070


(49,310
)

94,859Stockholders' equity


228,426


331,090


(56,119
)

(274,971
)

228,426Total liabilities and stockholders' equity

$
1,580,515

$
1,330,199

$
(10,914
)
$
(1,117,138
)
$
1,782,662


74

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)

Consolidating condensed statements of operations for the fiscal years ended April 25, 2010, April 26, 2009 and April 27, 2008 are as follows:

For the Fiscal Year Ended April 25, 2010Statement of Operations

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedRevenues:Casino

$


$
1,013,386

$


$


$
1,013,386Pari-mutuel, rooms, food, beverage and other


1,320


176,599


9,654


(9,572
)

178,001Gross revenues


1,320


1,189,985


9,654


(9,572
)

1,191,387Less promotional allowances





(191,551
)







(191,551
)Net revenues


1,320


998,434


9,654


(9,572
)

999,836Operating expenses:Casino





153,838








153,838Gaming taxes





262,241








262,241Pari-mutuel, rooms, food, beverage and other


45,479


370,311


3,979


(9,572
)

410,197Management fee expense (revenue)


(26,197
)

26,197








Depreciation and amortization


4,115


104,779


610





109,504Total operating expenses


23,397


917,366


4,589


(9,572
)

935,780Operating income (loss)


(22,077
)

81,068


5,065





64,056Interest expense, net


(10,827
)

(62,545
)

(229
)




(73,601
)Gain on extinguishment of debt














Other


(370
)










(370
)Equity in income (loss) of subsidiaries


14,671


(3,268
)




(11,403
)

Income (loss) from continuing operations before income taxes and noncontolling interest


(18,603
)

15,255


4,836


(11,403
)

(9,915
)Income tax (provision) benefit


17,062


(6,719
)

(1,969
)




8,374Income (loss) from continuining operations


(1,541
)

8,536


2,867


(11,403
)

(1,541
)Income (loss) of discontinued operations


(1,732
)

(1,167
)

(2,300
)

3,467


(1,732
)Net income (loss)

$
(3,273
)
$
7,369

$
567

$
(7,936
)
$
(3,273
)


75

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)



For the Fiscal Year Ended April 26, 2009Statement of Operations

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedRevenues:Casino

$


$
1,055,694

$


$


$
1,055,694Pari-mutuel, rooms, food, beverage and other


368


247,489


9,514


(9,427
)

247,944Gross revenues


368


1,303,183


9,514


(9,427
)

1,303,638Less promotional allowances





(195,603
)







(195,603
)Net revenues


368


1,107,580


9,514


(9,427
)

1,108,035Operating expenses:Casino





151,610








151,610Gaming taxes





269,928








269,928Pari-mutuel, rooms, food, beverage and other


47,098


382,196


9,658


(9,427
)

429,525Management fee expense (revenue)


(30,681
)

30,681








Depreciation and amortization


4,852


116,983


605





122,440Total operating expenses


21,269


951,398


10,263


(9,427
)

973,503Operating income (loss)


(20,901
)

156,182


(749
)




134,532Interest expense, net


(19,776
)

(69,765
)

(412
)




(89,953
)Gain on extinguishment of debt


57,693











57,693Equity in income (loss) of subsidiaries


53,133


(15,537
)




(37,596
)

Income (loss) from continuing operations before income taxes and noncontrolling interest


70,149


70,880


(1,161
)

(37,596
)

102,272Income tax (provision) benefit


(8,916
)

(33,175
)

1,052





(41,039
)Income (loss) from continuining operations


61,233


37,705


(109
)

(37,596
)

61,233Income (loss) from discontinued operations, net of tax


(17,658
)

(2,038
)

(39,614
)

41,652


(17,658
)Net income (loss)

$
43,575

$
35,667

$
(39,723
)
$
4,056

$
43,575


76

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)



For the Fiscal Year Ended April 27, 2008Statement of Operations

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedRevenues:Casino

$


$
1,092,293

$


$


$
1,092,293Pari-mutuel, rooms, food, beverage and other


359


199,393


13,253


(13,015
)

199,990Gross revenues


359


1,291,686


13,253


(13,015
)

1,292,283Less promotional allowances





(200,900
)







(200,900
)Net revenues


359


1,090,786


13,253


(13,015
)

1,091,383Operating expenses:Casino





151,090








151,090Gaming taxes





285,370








285,370Pari-mutuel, rooms, food, beverage and other


55,475


407,752


10,625


(13,015
)

460,837Management fee expense (revenue)


(29,600
)

29,600








Depreciation and amortization


5,089


123,264


582





128,935Total operating expenses


30,964


997,076


11,207


(13,015
)

1,026,232Operating income (loss)


(30,605
)

93,710


2,046





65,151Interest expense, net


(32,900
)

(70,716
)

51





(103,565
)Gain on extinguishment of debt


(13,660
)

(1,614
)







(15,274
)Equity in income (loss) of subsidiaries


16,569


(2,761
)




(13,808
)

Income (loss) from continuing operations before income taxes and including noncontrolling interest


(60,596
)

18,619


2,097


(13,808
)

(53,688
)Income tax (provision) benefit


27,826


7,806


(14,714
)




20,918Income (loss) from continuing operations including noncontrolling interest


(32,770
)

26,425


(12,617
)

(13,808
)

(32,770
)Income (loss) from discontinued operations, net of tax


(59,236
)

(627
)

(110,779
)

111,406


(59,236
)Net income (loss) including noncontrolling interest


(92,006
)

25,798


(123,396
)

97,598


(92,006
)Net income attributable to noncontrolling interest


(4,868
)

(4,868
)




4,868


(4,868
)Net income (loss) attributable to common stockholders

$
(96,874
)
$
20,930

$
(123,396
)
$
102,466

$
(96,874
)


77

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)

Consolidating
condensed statements of cash flows for the fiscal years ended April 25, 2010, April 26, 2009 and April 27, 2008 are as follows:

For the Fiscal Year Ended April 25, 2010Statement of Cash Flows

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedNet cash provided by (used in) operating activities

$
(9,849
)
$
120,337

$
(4,106
)
$


$
106,382Net cash provided by (used in) investing activities


110,144


(30,321
)

722


(111,535
)

(30,990
)Net cash provided by (used in) financing activities


(102,565
)

(111,703
)

(1,225
)

111,535


(103,958
)Effect of foreign currency exchange rates on cash and cash equivalents








(19
)




(19
)Net increase (decrease) in cash and cash equivalents


(2,270
)

(21,687
)

(4,628
)




(28,585
)Cash and cash equivalents at beginning of the period


8,776


68,681


19,197





96,654Cash and cash equivalents at end of the period

$
6,506

$
46,994

$
14,569

$


$
68,069




For the Fiscal Year Ended April 26, 2009Statement of Cash Flows

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedNet cash provided by (used in) operating activities

$
10,189

$
200,621

$
(20,200
)
$


$
190,610Net cash provided by (used in) investing activities


138,049


(26,177
)

(2,382
)

(137,357
)

(27,867
)Net cash provided by (used in) financing activities


(144,824
)

(173,151
)

23,435


137,357


(157,183
)Effect of foreign currency exchange rates on cash and cash equivalents








(696
)




(696
)Net increase (decrease) in cash and cash equivalents


3,414


1,293


157





4,864Cash and cash equivalents at beginning of the period


5,362


67,388


19,040





91,790Cash and cash equivalents at end of the period

$
8,776

$
68,681

$
19,197

$


$
96,654


78

---



Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

18. Consolidating Condensed Financial Information (Continued)

For the Fiscal Year Ended April 27, 2008Statement of Cash Flows

Isle of Capri
Casinos, Inc.
(Parent
Obligor)

Guarantor
Subsidiaries

Non-
Guarantor
Subsidiaries

Consolidating
and
Eliminating
Entries

Isle of Capri
Casinos, Inc.
ConsolidatedNet cash provided by (used in) operating activities

$
(50,627
)
$
213,017

$
(29,033
)
$


$
133,357Net cash provided by (used in) investing activities


(310,374
)

(272,573
)

(25,714
)

306,215


(302,446
)Net cash provided by (used in) financing activities


283,469


41,792


53,468


(306,215
)

72,514Effect of foreign currency exchange rates on cash and cash equivalents








251





251Net increase (decrease) in cash and cash equivalents


(77,532
)

(17,764
)

(1,028
)




(96,324
)Cash and cash equivalents at beginning of the period


82,894


85,152


20,068





188,114Cash and cash equivalents at end of the period

$
5,362

$
67,388

$
19,040

$


$
91,790


79

---



Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

19. Selected Quarterly Financial Information (unaudited)

Our selected quarterly financial information has included reclassifications for amounts show in our previously filed reports on Forms 10-Q to reflect the discontinued
operations presentation for our Freeport, Grand Bahama and UK casino properties.

Fiscal Quarters EndedJuly 26,
2009

October 25,
2009

January 24,
2010

April 25,
2010Net revenues

$
257,914

$
246,055

$
227,071

$
268,796Operating income


19,939


13,822


2,676


27,619Income (loss) from continuing operations


1,055


2,373


(11,400
)

6,431Income (loss) from discontinued operations, net of income taxes


(150
)

(811
)

775


(1,546
)Net income (loss)


905


1,562


(10,625
)

4,885Earnings (loss) per common share basic:Income (loss) from continuing operations

$
0.03

$
0.07

$
(0.35
)
$
0.20Income (loss) from discontinued operations, net of income taxes





(0.02
)

0.02


(0.05
)Net income (loss)

$
0.03

$
0.05

$
(0.33
)
$
0.15Earnings (loss) per common share diluted: Income (loss) from continuing operations

$
0.03

$
0.07

$
(0.35
)
$
0.20Income (loss) from discontinued operations, net of income taxes





(0.02
)

0.02


(0.05
)Net income (loss)

$
0.03

$
0.05

$
(0.33
)
$
0.15Weighted average basic shares


31,779,100


32,319,789


32,438,809


32,445,378Weighted average dilutive shares


31,885,101


32,511,462


32,438,809


32,515,829


80

---



Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

19. Selected Quarterly Financial Information (unaudited) (Continued)



Fiscal Quarters EndedJuly 27,
2008

October 26,
2008

January 25,
2009

April 26,
2009Net revenues

$
273,922

$
247,588

$
301,916

$
284,609Operating income


21,586


6,690


101,988


4,268Income (loss) from continuing operations


(3,282
)

(9,307
)

48,269


25,553Income (loss) from discontinued operations, net of income taxes


(344
)

(4,193
)

(2,156
)

(10,965
)Net income (loss)


(3,626
)

(13,500
)

46,113


14,588Earnings (loss) per common share basic:Income (loss) from continuing operations

$
(0.11
)
$
(0.30
)
$
1.52

$
0.80Income (loss) from discontinued operations, net of income taxes


(0.01
)

(0.13
)

(0.07
)

(0.34
)Net income (loss)

$
(0.12
)
$
(0.43
)
$
1.45

$
0.46Earnings (loss) per common share diluted:Income (loss) from continuing operations

$
(0.11
)
$
(0.30
)
$
1.52

$
0.80Income (loss) from discontinued operations, net of income taxes


(0.01
)

(0.13
)

(0.07
)

(0.34
)Net income (loss)

$
(0.12
)
$
(0.43
)
$
1.45

$
0.46Weighted average basic shares


30,866,687


31,171,903


31,765,365


31,770,653Weighted average dilutive shares


30,866,687


31,171,903


31,765,365


31,770,653


A
summary of certain revenues and expenses from our continuing operations impacting our quarterly financial results is as follows:

Fiscal Quarters EndedJuly 26,
2009

October 25,
2009

January 24,
2010

April 25,
2010(Expense) Revenue:Expense recoveries and other charges, net

$


$
6,762

$


$





Fiscal Quarters EndedJuly 27,
2008

October 26,
2008

January 25,
2009

April 26,
2009(Expense) Revenue:Hurricane and other insurance recoveries

$


$


$
92,179

$
3,030Expense recoveries and other charges, nst


(6,000
)







(30,125
)Gain on early extinguishment of debt











57,693


Hurricane and other Insurance RecoveriesReflect receipts relating to property and business interruption claims. During the third quarter of fiscal
2009, we received our final settlement of Hurricane Katrina claim.

81

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

19. Selected Quarterly Financial Information (unaudited) (Continued)

Expense recoveries and other charges, netDuring the second quarter of 2010 we recorded an expense recovery of $6,762, representing the discounted
value of a receivable for reimbursement of development costs. During first quarter of 2009 we terminated a potential development agreement for a casino project in Portland, Oregon and as a result
recorded a $6,000 charge. During the fourth quarter of 2009 our valuation charges included $18,269 in goodwill and intangible asset impairment at our Black Hawk, Colorado property as a result of our
annual impairment testing under required under ASC 350 and $11,856 to write-off construction in progress at our Biloxi property.

Gain (loss) on Extinguishment of DebtDuring the fourth quarter of fiscal 2009, we retired $142,725 of our Senior Subordinated Notes through a tender
offer for $82,773 from our available cash and cash equivalents. After expenses related to the elimination of deferred finance costs and transactions costs, we recognized a pretax gain of $57,892
during fiscal 2009. During the fourth quarter of fiscal 2009, we permanently repaid $35,000 of our variable rate term loans under our 2007 Credit facility with proceeds from our hurricane insurance
settlement resulting in a loss on early extinguishment of debt of $199 due to the write-off of deferred financing costs.

Discontinued OperationsThe fourth quarter of fiscal 2009 includes losses of $13,416 associated with the sale of our Coventry, England operations and
the planned discontinuance of our other United Kingdom operations.

20. Commitments and Contingencies

Operating LeasesFuture minimum payments over the lease term of non-cancelable operating leases with initial terms of one year or more
consisted of the following at April 25, 2010:

Fiscal Years Ending:2011

$
20,5102012


16,5962013


16,2902014


16,2382015


15,684Therafter


423,479Total minimum lease payments

$
508,797


Rent
expense from continuing operations was $31,672, $33,109, and $35,357 in fiscal years 2010, 2009, and 2008, respectively. Such amounts include contingent rentals of $5,739, $6,259,
and $8,037 in fiscal years 2010, 2009 and 2008, respectively.

Legal and Regulatory ProceedingsLady Luck Gaming Corporation (now our wholly owned subsidiary) and several joint venture partners have been
defendants in the Greek Civil Courts and the Greek Administrative Courts in similar lawsuits brought by the country of Greece. The actions allege that the defendants failed to make specified payments
in connection with the gaming license bid process for Patras, Greece. Although it is difficult to determine the damages being sought from the lawsuits, the action may seek damages up to that aggregate
amount plus interest from the date of the action.

82

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Table of Contents

ISLE OF CAPRI CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(amounts in thousands, except share and per share amounts)

20. Commitments and Contingencies (Continued)

In
the Civil Court lawsuit, the Civil Court of First Instance ruled in our favor and dismissed the lawsuit in 2001. Greece appealed to the Civil Appeal Court and, in 2003, the Court
rejected the appeal. Greece then appealed to the Civil Supreme Court and, in 2007, the Supreme Court ruled that the matter was not properly before the Civil Courts and should be before the
Administrative Court.

In
the Administrative Court lawsuit, the Administrative Court of First Instance rejected the lawsuit stating that it was not competent to hear the matter. Greece then appealed to the
Administrative Appeal Court, which court rejected the appeal in 2003. Greece then appealed to the Supreme Administrative Court, which remanded the matter back to the Administrative Appeal Court for a
hearing on the merits. The re-hearing took place in 2006, and in 2008 the Administrative Appeal Court rejected Greece's appeal on procedural grounds. On December 22, 2008 and
January 23, 2009, Greece appealed the ruling to the Supreme Administrative Court. A hearing has tentatively been scheduled for November 2010.

The
outcome of this matter is still in doubt and cannot be predicted with any degree of certainty. We intend to continue a vigorous and appropriate defense to the claims asserted in this
matter. Through April 25, 2010, we have accrued an estimated liability including interest of $10,690. Our accrual is based upon management's estimate of the original claim by the plaintiffs for
lost payments. We continue to accrue interest on the asserted claim. We are unable to estimate a total possible loss as information as to possible additional claims, if any, have not been asserted or
quantified by the plaintiffs at this time.

During
January, 2010, we entered into an agreement to provide management services for a potential casino to be located at the Nemacolin Woodlands Resort in Farmington, Pennsylvania,
("the Resort"). The development of this casino is subject to numerous regulatory approvals including obtaining a state gaming license, which is a competitive award process among several applicants. If
the Resort is successful in obtaining a gaming license, we have agreed to complete the build-out of the casino space. We currently estimate the project cost at approximately
$50 million.

We
are subject to certain federal, state and local environmental protection, health and safety laws, regulations and ordinances that apply to businesses generally, and are subject to
cleanup requirements at certain of our facilities as a result thereof. We have not made, and do not anticipate making material expenditures, nor do we anticipate incurring delays with respect to
environmental remediation or protection. However, in part because our present and future development sites have, in some cases, been used as manufacturing facilities or other facilities that generate
materials that are required to be remediated under environmental laws and regulations, there can be no guarantee that additional pre-existing conditions will not be discovered and we will
not experience material liabilities or delays.

We
are subject to various contingencies and litigation matters and have a number of unresolved claims. Although the ultimate liability of these contingencies, this litigation and these
claims cannot be determined at this time, we believe they will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

21. Event (Unaudited) Subsequent to the Date of the Independent Auditor's Report

On June 8, 2010, we completed our acquisition of Rainbow Casino located in Vicksburg, Mississippi for $80,000. The acquisition was financed through borrowings under our Credit
Facility.

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ISLE OF CAPRI CASINOS, INC.        SCHEDULE IIVALUATION AND QUALIFYING ACCOUNTS        (In thousands)

Accounts Receivable ReservePeriod

Balance at
Beginning of
Year

Charged to
Costs and
Expenses

Deductions from
Reserves

Balance at End
of YearYear Ended April 25, 2010

$
5,106

$
1,400

$
(4,551
)
$
1,955Year Ended April 26, 2009


4,258


973


(125
)

5,106Year Ended April 27, 2008


4,335


3,407


(3,484
)

4,258




Other Receivables ReservePeriod

Balance at
Beginning of
Year

Charged to
Costs and
Expenses

Deductions from
Reserves

Balance at End
of YearYear Ended April 25, 2010

$
3,194

$


$
(312
)
$
2,882Year Ended April 26, 2009


3,194








3,194Year Ended April 27, 2008


3,194








3,194


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ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.    CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and ProceduresBased on their evaluation as of April 25, 2010, our Chief Executive Officer and Chief
Financial Officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were sufficiently
effective to ensure that the information required to be disclosed by us in this Annual Report was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and
instructions for Form 10-K.

Management's Report on Internal Control over Financial ReportingOur management is responsible for establishing and maintaining adequate internal
control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management, including our Chief Executive Officer and Chief Financial Officer, assessed
the effectiveness of our internal control over financial reporting as of April 25, 2010. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission in Internal ControlIntegrated Framework. Our management has concluded that, as of April 25, 2010, our internal control over financial
reporting is effective based on these criteria. Ernst & Young LLP, an independent registered public accounting firm, who audited and reported on the consolidated financial statements
included in this Annual Report on Form 10-K, has issued an attestation report on the effectiveness of the Company's internal control over financial reporting as stated in their
report which is included in Item 8.

Changes in Internal Controls over Financial ReportingThere have been no changes in our internal controls over financial reporting during the quarter
ended April 25, 2010 that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting, other than the remediation of the material
weakness discussed below. During the quarter ended April 25, 2010, we implemented a redacted accounting chart of accounts to improve our overall processes as well as implemented a new financial
report writing software. The internal controls over our general ledger and financial reporting remained consistent before and after these changes.

Inherent Limitations on Effectiveness of ControlsOur management, including our Chief Executive Officer and Chief Financial Officer, does not expect
that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter
how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact
that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.

ITEM 9B.    OTHER INFORMATION

None.

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PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

DIRECTORS

Each of the individuals listed below is currently serving on the Company's Board of Directors.

Name

AgeJames B. Perry


60Robert S. Goldstein


55W. Randolph Baker


63John G. Brackenbury*


73Alan J. Glazer


69Jeffrey D. Goldstein


57Richard A. Goldstein


49Shaun R. Hayes


50Gregory J. Kozicz


49Lee S. Wielansky


59


*John
G. Brackenbury, a director currently serving on the Company's Board of Directors, is retiring and will not be standing for re-election.


James B. Perryhas been a director since July 2007 and was named Chairman of the Board in August 2009. Since March 2008, he has served as
our Chief Executive Officer. Prior to being named Chairman, Mr. Perry was Executive Vice Chairman from March 2008 to August 2009 and Vice Chairman from July 2007 to March 2008. Mr. Perry
served as a Class III Director on the board of Trump Entertainment Resorts, Inc. from May 2005 until July 2007. From July 2005 to July 2007, Mr. Perry served as Chief Executive
Officer and President of Trump Entertainment Resort, Inc., which filed for Chapter 11 bankruptcy in February 2009. Mr. Perry was President of Argosy Gaming Company from April 1997
through July 2002 and Chief Executive Officer of Argosy Gaming Company from April 1997 through May 2003. Mr. Perry also served as a member of the Board of Directors of Argosy Gaming Company
from 2000 to July 2005. Mr. Perry brings more than 25 years of industry experience to the Board and his day-to-day leadership of the Company provides our Board of
Directors with intimate knowledge of all aspects of our business. He also has extensive experience in executive management and strategic planning.

Robert S. Goldsteinhas been a director since February 1993 and was named Vice Chairman of the Board in March 2008. Prior to being named
Vice Chairman, Mr. Goldstein was Executive Vice Chairman from October 2005 to March 2008. Mr. Goldstein is the Chairman, Chief Executive Officer and President of Alter Trading
Corporation, a company engaged in the business of scrap metal recycling, and has been associated with that company since 1977. Mr. Goldstein serves as Chairman and Chief Executive Officer of
Goldstein Group, Inc., a private company. Additionally, Mr. Goldstein was a director, officer, and stockholder of the Steamboat Companies and has been an officer of several affiliated
companies engaged in river transportation, stevedoring and equipment leasing since 1980. Mr. Goldstein is the brother of Jeffrey D. Goldstein and Richard A. Goldstein. Mr. Goldstein has
extensive experience in management of operations, corporate governance and strategic planning. Mr. Goldstein has served as a member of our Board for more than 16 years and brings to the
Board an in-depth understanding of the Company's business, history and organization.

W. Randolph Bakerhas been a director since September 1997. In July 2008, Mr. Baker resigned from his position as Chair of the
Sycuan Institute on Tribal Gaming at San Diego State University, the nation's first academic program dedicated to the study of tribal gaming, where he served since August 2006. He is currently a
principal in Randolph Baker & Associates, a consulting firm located in San

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Antonio,
Texas. Previously Mr. Baker served as Executive Director of the Shelby County Schools Education Foundation, a nonprofit organization dedicated to enhancing the quality of
K-12 education in Shelby County, Tennessee. From June 1996 to Spring 2004, he served as Vice Chairman and Chief Executive Officer of Thompson Baker & Berry, a regional public
relations and public affairs firm located in Memphis, Tennessee. Prior to that, Mr. Baker served as the Harrah's Visiting Professor of Gaming Studies in the College of Business at the
University of Nevada, Reno, and as Director of Public Affairs for The Promus Companies Incorporated, then a holding company for casino and hotel brands (including Harrah's casino hotels) in Memphis,
Tennessee. Mr. Baker has extensive experience in management of operations, regulatory matters, public policy, corporate governance, corporate finance and accounting and brings to the Board a
significant level of knowledge regarding tribal gaming.

John G. Brackenbury, C.B.E. has been a director since January 2004. He also serves as Chairman of the Board of Directors of our wholly
owned subsidiary, Isle of Capri Casinos, Ltd. and Blue Chip Casinos Plc., both of which were sold in fiscal year 2010. Mr. Brackenbury, who has over 40 years of experience
in the leisure sector in the United Kingdom, is involved in numerous organizations. Mr. Brackenbury has served as chairman of Business in Sport & Leisure since 1985 and was made Life
President on March 17, 2005 and as chairman of Brackenbury Leisure Limited since 1996. He has served as Chairman of Avanti Screenmedia since 2002 and on the demerger of Avanti Screenmedia and
Avanti Communications in April 2007, he was a non-executive director of Avanti Screenmedia and resigned and became chairman of Avanti Communications Group Plc and ceased to be
chairman of Active Media Capital in April 2007 when it was acquired by Avanti Screenmedia. From November 1996 to December 2003, he was Chairman of Pubmaster Limited, which was one of the United
Kingdom's leading independent pub operators. Mr. Brackenbury previously served as a non-executive director of Holsten (UK) Limited, Hotel & Catering Training Company, Western
Wines Limited, Aspen Group Plc, SFI Holdings Limited, Brewing Research Foundation and as an executive director of Brent Walker Group, Plc and Chairman of People 1st. Blue
Chip Casinos Plc, a company on which Mr. Brackenbury serves on the Board of Directors, and of which we own a majority interest, filed for Administration in the United Kingdom under the
Insolvency Act 1986 in March 2009. Additionally, during fiscal year 2010, we completed the sale of our Blue Chip casino properties under a plan of administration and have no continuing involvement in
its operation. Mr. Brackenbury has extensive experience in international operations, strategic planning and corporate governance. Mr. Brackenbury has been invaluable to the Board in connection
with the Company's U.K. operations.

Alan J. Glazerhas been a director since November 1996 and in October 2009, was named Lead Director. He is currently a Senior Principal of
Morris Anderson & Associates, Ltd., a national management consulting firm, where he has worked since 1984. Prior to joining Morris Andersen, Mr. Glazer was Senior Vice President
and Chief Financial Officer for Consolidated Foods Corp., a large international manufacturer and distributor of branded consumer products. Before joining CFC, Mr. Glazer spent 13 years
at Arthur Andersen & Co., the last five as a General Partner. Mr. Glazer also
serves as a director of Goldstein Group, Inc., a private company owned by the Goldstein family. Mr. Glazer has extensive experience in management of operations, corporate finance and
accounting and brings to the Board extensive knowledge of the financial and accounting issues facing public companies. The Board has designated Mr. Glazer as an "audit committee financial
expert" as that term is defined in the SEC's rules adopted pursuant to the Sarbanes-Oxley Act of 2002.

Jeffrey D. Goldsteinhas been a director since October 2001. Mr. Goldstein is Chairman and President of Alter Company and its
related barge and other transportation entities. Mr. Goldstein has been associated with Alter Company for over thirty years, serving in various management roles. Mr. Goldstein serves as
a director of Goldstein Group, Inc., a private company. Additionally, Mr. Goldstein was a director, officer, and stockholder of the Steamboat Companies. Mr. Goldstein is the
brother of Robert S. Goldstein and Richard A. Goldstein. Mr. Goldstein has extensive experience

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in
management of operations, corporate governance and strategic planning and brings to the Board invaluable perspectives on all aspects of the Company's business.

Richard A. Goldsteinhas been a director since October 2009. Mr. Goldstein serves on the Board of Directors, and is an Executive
Vice President, of Alter Trading Corporation, a company engaged in the business of scrap metal recycling, and has been associated with that company since 1983. Mr. Goldstein also serves as the
President of Alter Energy, LLC, and serves on the Board of Directors, and is an Executive Vice President, of Alter Company. Mr. Goldstein serves as a director and Executive Vice
President of Goldstein Group, Inc., a private company. Mr. Goldstein was a director, officer and stockholder of the Steamboat Companies. Mr. Goldstein is the brother of Jeffrey D.
Goldstein and Robert S. Goldstein. Mr. Goldstein has extensive experience in management of operations, corporate governance and strategic planning and brings to the Board invaluable
perspectives on all aspects of the Company's business.

Shaun R. Hayeshas been a director since January 2006. Since August 2008, Mr. Hayes has served as President and CEO of Sun Security
Bank, a wholly-owned subsidiary of Sun Financial, a Missouri-based bank holding company. Mr. Hayes was president and chief executive officer of Missouri banking for National City Bank from
April 2004 to July 2008. Mr. Hayes has extensive experience in management of operations, banking, corporate finance and accounting and his experience and expertise have proven especially
valuable to the Board in its financing matters.

Gregory J. Koziczhas been a director since January 2010. Mr. Kozicz is president and chief executive officer of Alberici
Corporation, a St. Louis-based diversified construction, engineering and steel fabrication company, and Alberici Constructors Inc., a wholly-owned subsidiary of Alberici Corporation. He
also serves on the Eighth District Real Estate Industry Council of the Federal Reserve Bank of St. Louis. He has served as president and chief executive officer of Alberici Corporation and
Alberici Constructors since 2005 and June 2004, respectively. Prior to his current roles, Kozicz was president of Alberici Constructors Ltd. (Canada). Before joining Alberici in 2001, Kozicz
served as a corporate officer and divisional president for Aecon, a publicly-traded construction, engineering and fabrication
company. Mr. Kozicz has extensive experience in management of operations, the construction industry, real estate investments, corporate governance and strategic planning. Mr. Kozicz
brings to the Board a wide range of experience, particularly with respect to construction and development matters.

Lee S. Wielanskyhas been a director since February 2007. Since March 2003, Mr. Wielansky has served as Chairman and Chief
Executive Officer of Midland Development Group, Inc., a commercial real estate development company with locations in St. Louis, Missouri and Jacksonville, Florida. From November 2000 to
March 2003, Mr. Wielansky served as President and Chief Executive Officer of JDN Development Company, Inc., a wholly owned subsidiary of JDN Corporation, a publicly traded real estate
investment trust engaged in the development of retail shopping centers. From 1998 to 2000, Mr. Wielansky was a Managing Director of Regency Centers Corporation, a publicly traded real estate
investment trust. In 1983, Mr. Wielansky co-founded Midland Development Group, Inc. and served as Chief Executive Officer until 1998 when the company was acquired by Regency
Centers Corporation. Mr. Wielansky serves as Chairman of the Board of Directors of Pulaski Financial Corp., the holding company for Pulaski Bank, and serves as a director of Acadia Realty
Trust, a real estate investment trust. Mr. Wielansky has extensive experience in management of operations, real estate investments and management, corporate governance, corporate finance and
accounting. Mr. Wielansky brings to the Board important perspectives with respect to real estate and developments.

With
respect to each of our current directors, we own a majority interest in Blue Chip Casinos Plc, a United Kingdom entity which owns and operates two casinos in the United
Kingdom. In March of 2009, Blue Chip filed for Administration in the United Kingdom under the Insolvency Act 1986.

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During
fiscal year 2010, we completed the sale of our Blue Chip casino properties under a plan of administration and have no continuing involvement in its operation.

EXECUTIVE OFFICERS

Below is a table that identifies our executive officers as of the date of filing of this Amendment, other than Mr. Perry, who is
identified in the section above entitled "Directors."

Name

Age

Position(s)Virginia M. McDowell


52

President and Chief Operating OfficerDale R. Black


47

Senior Vice President and Chief Financial OfficerArnold L. Block


63

Senior Vice President, Isle OperationsR. Ronald Burgess


66

Senior Vice President of Human ResourcesD. Douglas Burkhalter


43

Senior Vice President of MarketingRoger W. Deaton


63

Senior Vice President, Lady Luck OperationsEric L. Hausler


41

Senior Vice President, Strategic InitiativesPaul B. Keller


56

Senior Vice President and Chief Development OfficerDonn R. Mitchell, II


42

Senior Vice PresidentEdmund L. Quatmann, Jr.


40

Senior Vice President, General Counsel and SecretaryJeanne-Marie Wilkins


51

Senior Vice President and Chief Information Officer


Virginia M. McDowellhas been our President and Chief Operating Officer since July 2007. From October 2005 to July 2007,
Ms. McDowell served as Executive Vice President and Chief Information Officer at Trump Entertainment Resorts, Inc., which filed for Chapter 11 bankruptcy in February 2009. From
1997 through October 2005, Ms. McDowell served in a variety of positions at Argosy Gaming Company, including Vice President of Sales and Marketing, and Senior Vice President of Operations.
Prior to working at Argosy, Ms. McDowell served as the East Coast General Manager for Casino Data Systems and held management positions at a number of Atlantic City gaming properties beginning
in 1981.

Dale R. Blackhas been our Senior Vice President and Chief Financial Officer since December 2007. From November 2005 to December 2007, he
served as Executive Vice PresidentChief Financial Officer of Trump Entertainment Resorts, Inc., which filed for Chapter 11 bankruptcy in February 2009. From April 1993
through October 2005, Mr. Black worked at Argosy Gaming Company in Alton, Illinois, becoming Chief Financial Officer in 1998 after serving as Vice President and Corporate Controller. Prior to
joining Argosy, he spent seven years in the audit practice of Arthur Andersen LLP.

Arnold L. Blockhas been our Senior Vice President, Isle Operations since December 2008. Prior to that, Mr. Block served as senior
vice president and general manager of the Harrah's, St. Louis property from October 2005 to January 2008. From July 1993 to October 2005, Mr. Block worked in a variety of leadership
capacities for Argosy Gaming Company, including serving as regional vice president from June 2002 until October 2005 when the company was sold. In that role, he was responsible for three Argosy
properties; Lawrenceburg, Indiana, Kansas City, Missouri, and Baton Rouge, Louisiana. He began his career as general manager and later owner of a 150-room hotel in Alton, Illinois and from
1986 to 1988 he owned and operated two restaurants in St. Louis, Missouri.

R. Ronald Burgesshas been our Senior Vice President of Human Resources since September 2007. From October 2005 to September 2007,
Mr. Burgess served as a consultant to Norwegian Cruise Lines and on the launch of gaming in Macau for Galaxy Entertainment. From July 1999 through October 2005, Mr. Burgess served as
Senior Vice President of Human Resources for Argosy Gaming Company. From 1986 to 1999, Mr. Burgess was Corporate Director of Human Resources for Harrah's Entertainment, Inc. Prior to
joining Harrah's in 1986, he was responsible for human resources at a major operating unit of RCA, ultimately managing the merger with General Electric.

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D. Douglas Burkhalterhas been our Senior Vice President of Marketing since September 2007. From November 2005 to July 2007,
Mr. Burkhalter served as Vice President of Marketing Strategy for Trump Entertainment Resorts, Inc., which filed for Chapter 11 bankruptcy in February 2009. He also held the
position of Corporate Director of Marketing for Argosy Gaming Company from June 2002 until November 2005.

Roger W. Deatonhas been our Senior Vice President, Lady Luck Operations since December 2008. Mr. Deaton joined us in 1992 and has
served in a variety of roles including regional vice president, vice president and general manager of the Company's properties in Vicksburg, Mississippi, which was sold in July 2006, and Lake Charles,
Louisiana. Prior to his current position, Mr. Deaton served as our Regional Vice President of Operations since February 2000. Mr. Deaton spent the early years of his gaming career in
Nevada in positions with Nevada Lodge, Crystal Bay Club, Ponderosa Reno, Harvey's Lake Tahoe and King's Castle before moving to Atlantic City as part of the original Resort's International team.

Eric L. Hauslerhas been our Senior Vice President, Strategic Initiatives since September 2009. From October 2006 to August 2009,
Mr. Hausler served as Senior Vice President of Development for Trump Entertainment Resorts, Inc., which filed for Chapter 11 bankruptcy in February 2009. From August 2005 to
September 2006, Mr. Hausler served as a Managing Director in Fixed Income Research, covering the gaming, lodging and leisure industries for Bear Stearns & Co. Inc., and as
a Vice President in Equity Research from December 1999 to July 2002. From October 2003 to August 2005, Mr. Hausler served as the Senior Equity Analyst covering the gaming industry for
Susquehanna Financial Group. From July 2002 to September 2003, Mr. Hausler served as an Associate Analyst in Equity Research covering the gaming and lodging industries for Deutsche Bank
Securities. From December 1996 to November 1999, Mr. Hausler served as the Governmental and Community Relations Coordinator for the New Jersey Casino Control Commission, among other positions.

Paul B. Kellerhas been our Senior Vice President and Chief Development Officer since May 2008. From September 2007 to May 2008,
Mr. Keller was a consultant for us. From October 2005 to July 2007, Mr. Keller served as Executive Vice President of Design and Construction for Trump Entertainment Resorts, Inc.,
which filed for Chapter 11 bankruptcy in February 2009. From September 1993 to October 2006, he served as Vice President of Design and Construction for Argosy Gaming Company.

Donn R. Mitchell, IIhas been our Senior Vice President since December 2007. Previously, he served as Senior Vice President, Chief
Financial Officer and Treasurer from January 2006 to December 2007. Mr. Mitchell joined us in June 1996 as Director of Finance and served as Vice President of Finance
from July 2001 to December 2005. Mr. Mitchell's prior experience includes serving as an audit manager for Arthur Andersen LLP in New Orleans, Louisiana from July 1990 until June 1996.

Edmund L. Quatmann, Jr.has been our Senior Vice President, General Counsel and Secretary since July 2008. Prior to joining us,
Mr. Quatmann was the Senior Vice President and General Counsel of iPCS, Inc., a wireless telecommunications company based in Schaumburg, Illinois, where he was employed from November
2004 to June 2008. Prior to that, Mr. Quatmann practiced law in the corporate and securities groups of Mayer Brown LLP (October 1998 to November 2004) and Bryan Cave LLP
(September 1996 to October 1998).

Jeanne-Marie Wilkinshas been our Senior Vice President and Chief Information Officer since April 2008. Prior to that, she was a
consultant to the Company from September 2007 until April 2008. From October 2005 to July 2007, Ms. Wilkins served as Vice President of Business Strategy for Trump Entertainment
Resorts, Inc., which filed for Chapter 11 bankruptcy in February 2009. From May 2002 through September 2005, she served as the business strategy leader for Argosy Gaming Company. She
began her gaming career working for Bally Technologies f/k/a Bally Gaming and Systems as a

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consultant
from March 1996 to March 1998. She served as a regional manager for Bally Technologies from March 1998 to May 2002 in state regulated, tribal and international gaming jurisdictions.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

To the Company's knowledge, with respect to the fiscal year ended April 25, 2010, the Company's directors, officers and 10%
stockholders complied with all applicable Section 16(a) filing requirements; provided, however, that Form 4 filings for each of Arnold L. Block, Virginia M. McDowell and James B.
Perry reporting their respective fiscal 2009 long-term incentive awards were filed late. The filings were due on July 27, 2009 and were filed on July 29, 2009.

CODE OF CONDUCT

As required by Nasdaq Rule 5610, the Board of Directors has adopted a Code of Business Conduct that applies to all of the
Company's directors, officers and employees. In
addition, the Company has adopted a Code of Ethics that applies to its principal executive officer, principal financial officer, principal accounting officer, controller and others performing similar
functions and specifies the legal and ethical conduct expected of such officers. The Company's Code of Business Conduct and Code of Ethics are posted on the Company's website at www.islecorp.comunder
Investor RelationsCorporate Governance and will be provided free of charge upon request to the Company.

AUDIT COMMITTEE

Messrs. Glazer, Baker, Hayes and Wielansky are members of the Audit Committee. Mr. Glazer acts as chairman of the Audit
Committee. The Audit Committee's responsibilities include selecting our independent registered public accounting firm, reviewing the plan, scope and results of the independent audit, reviewing the
fees for the audit services performed, reviewing and pre-approving the fees for the non-audit services to be performed and reviewing all financial statements. Each member of
the Audit Committee is "independent" as defined in Nasdaq Rule 5605(a)(2). The Board has determined that each member of the Audit Committee is free from any relationship that would interfere
with the exercise of independent judgment as a committee member. Mr. Glazer has been designated as our "audit committee financial expert" under the SEC Rules. The Audit Committee is governed by
a written charter approved by the Board of Directors. The Audit Committee Charter is posted on the Company's website atwww.islecorp.comunder Investor
RelationsCorporate Governance.

ITEM 11.    EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

For purposes of the following Compensation Discussion and Analysis, the terms "executives" and "executive officers" refer to the Named
Executive Officers of the Company as set forth in the Summary Compensation Table below, and the term the "Committee" refers to the Stock Option and Compensation Committee.

Executive Summary

In fiscal 2010 the Company reduced operating expenses, improved customer satisfaction scores, improved its balance sheet and prudently
explored options for deploying capital, resulting in a management opportunity in Pennsylvania and a strategic acquisition in Mississippi. The Committee remains committed to its executive compensation
philosophy and key objectives, including relating total compensation opportunities for executives to the Company's financial performance. The Committee

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believes
that the compensation paid to the executive officers in fiscal 2010 is commensurate with the Company's performance in a challenging economic environment.

Company Performance

The Committee believes that the Company's fiscal 2010 results show that it remains committed to its goal of fiscal responsibility
through this difficult economic cycle. The Company re-engineered the costs associated with its business while consistently improving the guest experience across its portfolio.
Specifically, the Company reduced property-level operating expenses by approximately $12.0 million, totaling over approximately $32.0 million in cost reductions over the past two fiscal
years, while increasingSee. Say. Smile.customer satisfaction scores to approximately 90%, an increase from approximately 60% two years ago.

The
Company also continued to make efforts to improve its balance sheet, reducing its outstanding debt from approximately $1.5 billion as of April 27, 2008 to approximately
$1.2 billion as of April 25, 2010,
a reduction of approximately $300 million. In fiscal 2010 the Company entered into an amendment to its senior secured credit facility that permits increased flexibility in operations and
capital spending.

The
Company actively explored options for deploying capital to maximize value for its shareholders, including possible acquisitions, greenfield developments and management opportunities
in a variety of jurisdictions. Specifically,



Operating
free cash flow for fiscal 2010 was approximately $76.0 million, or approximately 96% of the target established under our annual non-equity bonus plan.

For
a complete discussion of the Company's performance in fiscal 2010, reference should be made to Management's Discussion and Analysis of Financial Condition and Results of Operations
herein.

Peer Group

For fiscal 2010, the Committee used a peer group consisting of comparably sized gaming companies as well as a couple of companies in
the broader hospitality/entertainment business. The Committee believed that this peer group was appropriate for determining relative industry performance as well as for recruiting and retention
purposes. Generally, the companies that make up the Company's peer group are its business competitors as well as its primary source of, and primary competition for, executive talent. Many of the
Company's executives have been recruited from other gaming operations. In addition, since gaming and racing are highly regulated industries, it takes a high degree of

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experience
and prior knowledge to provide effective oversight to multiple gaming and racing properties in a variety of jurisdictions. Also, the Company's executive officers are required to submit to
extensive investigations conducted by the state police or an equivalent investigatory agency of their personal financial records, their character and their competency in order to be found "suitable"
to serve in their respective capacities in each of the jurisdictions in which the Company operates. Accordingly, the pool for executives capable and willing to serve in an executive capacity in a
publicly traded, multi jurisdictional gaming and racing company tends to consist mostly of individuals who are already working within the gaming industry and among our peer group.

For
fiscal 2010, the peer group used for benchmarking purposes consisted of the following seven companies: Ameristar Casinos, Inc., Boyd Gaming Corp., Gaylord
Entertainment, Co., Penn National Gaming, Inc., Pinnacle Entertainment, Inc., Trump Entertainment Resorts and Vail Resorts, Inc. As discussed below in "Fiscal 2011
Compensation Actions" the Committee revised the peer group for fiscal 2011.

Executive Compensation Philosophy

The Committee designed the executive compensation program to attract and retain superior executive talent, incentivize our executives
to drive profitable growth and enhance long-term value for our shareholders. Key elements of the program include base salary and performance-based incentives (including both cash and
equity opportunities).

Key
objectives of our executive compensation policy include:



The
executive compensation program is designed to reward the achievement of difficult but fair performance criteria and enhance stock ownership among the executive team. The following
principles provide the framework for the Company's executive compensation program:









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The
Committee analyzes market data and evaluates individual executive performance with a goal of setting compensation at levels it believes, based on its general business and industry
knowledge and experience, are comparable with compensation levels of executives in other companies of similar size operating in the gaming industry. The Committee engages compensation consulting firms
to provide guidance regarding competitive compensation practices, industry peer analysis and recommendations. Using this guidance and peer group compensation information as a point of reference, the
Committee then focuses on the Company's and executives' individual performance in determining each component of annual compensation.

Overview of Executive Compensation Elements

The use of the below compensation elements enables the Company to reinforce its pay for performance philosophy as well as strengthen
its ability to attract and retain high performing executive officers. The Company believes that this combination of programs provides an appropriate mix of fixed and variable pay, balances
short-term operational performance with long-term shareholder value creation, and facilitates executive recruitment and retention in a high-performance culture.

The
Committee reviews pay competitiveness from a total compensation perspective. The Company relies primarily on market data to determine pay opportunities for each component.

The
principle elements of the Company's executive compensation program are described below. Please see "Analysis of Fiscal 2010 Compensation" below for a discussion of the specific
actions taken with respect to executive compensation for fiscal 2010.

Base Salary.Base salary pays for competence in the executive role. Base salary levels at the Company reflect a combination of factors,
including
competitive pay levels, the executive's experience and tenure, internal pay equity, the need to attract and retain excellent management talent, the Company's overall annual budget for merit increases
and the executive's individual performance.

Annual Incentive/Non-Equity.The purpose of the Company's annual incentive plan is to tie compensation directly to specific business
goals and management objectives. The Committee believes that basing annual cash bonuses for executive officers on pre-determined company performance metrics establishes a direct and
powerful link between our executives' pay and our financial and operational success. The Committee further believes that the achievement of the goals for these operating performance metrics are
closely correlated to the creation of long-term shareholder value.

Annual
incentive opportunities are expressed as a percentage of base salary and are initially set forth in each executive's employment agreement. Targets are developed considering
competitive practices and consistency with the Company's internal structure. Executives are grouped together in our internal structure according to their position and relative importance to the
Company. The Committee sets the ranges of bonuses payable for each executive as a percentage of base salary, taking into consideration the incentive programs and practices used by the Company's peer
group. For fiscal 2010, the target for each executive as a percentage of base salary was 60%. For the executives, the target annual incentive opportunity as a percentage of base salary is generally
the median of market practices.

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The Committee sets the ranges of bonuses payable for each executive as a percentage of base salary, consistent with the incentive programs and practices used by the Company's peer group.
For fiscal 2010, the target for each executive as a percentage of base salary was 60%.

Long-Term Incentive/Equity.The primary long-term incentive for executives is shares of restricted stock vesting ratably over
three years. Until the shares vest they remain subject to forfeiture upon termination of employment or position as a director and restrictions on transfer. If and when the shares vest, they are no
longer "restricted," and the recipient is free to hold, transfer or sell them, subject to required tax withholding and compliance with applicable securities laws, our securities trading policy, our
holding policy and any other legal requirements. The Committee's practice is to deliver 25% of the value of the long-term incentive in cash and 75% in shares of restricted stock. The
rationale for paying 25% of the long-term incentive in cash is to promote and facilitate retention of the shares of restricted stock by providing cash to enable the award recipient to pay
taxes if he or she chooses to do so. Long-term incentive awards with respect to a particular fiscal year are typically made within the first three months of the succeeding fiscal year. For
example, the long-term incentive award for fiscal 2010 (i.e., the year ended April 25, 2010) was awarded in July 2010 (during fiscal 2011). The long-term
incentive amount for each executive, as described in further detail below, is based on the Company meeting a certain threshold level of performance.

Deferred Compensation.The Company does not maintain any defined benefit pension programs for its executives. Instead, consistent with
the
competitive practices of the Company's peer group, the Company maintains an elective non-qualified deferred compensation plan for executives. The plan is unfunded and benefits are paid
from the Company's general assets. The Company generally sets aside separately the amounts deferred by the executives and the matching contributions thereon. None of the executives participate in this
plan.

Benefits and Perquisites.The Committee believes that executives should be offered customary benefits and perquisites that are
reasonable relative to
the benefits provided to all employees and consistent with competitive practices among the Company's peer group. The standard benefits offered to all of the Company's employees include medical, dental
and vision insurance, group life insurance, short and long-term disability and a 401(k) with certain contributions matched by the Company. In addition, all executives are enrolled in the
Medical Executive Reimbursement Plan (the "MERP") in which an allocation in amount up to 5% of each executive's base salary aids with payment of certain medical expenses other than premiums. All such
supplemental benefits and perquisites are subject to applicable federal, state and local taxation. The benefit paid under the MERP is grossed-up for taxes.

Role of Executive Officers and Board of Directors in Compensation Decisions

The Chief Executive Officer assists the Committee in making compensation decisions for the executives primarily by making
recommendations and evaluating day-to-day performance of the executives. The Chief Executive Officer and other executives do not play a role in determining their own
compensation and are not present at the executive sessions in which their pay is discussed.

The
Committee's analysis and recommendations are presented to the Board of Directors for ratification.

Role of Compensation Consultant

Since 2008, the Committee has engaged the firm of Towers Watson (formerly known as Watson Wyatt) as the Committee's independent
compensation consultant. Generally Towers Watson performs the following duties for the Committee:



95

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Towers
Watson receives no fees or compensation from the Company for services other than for its services as compensation consultant.

Analysis of Fiscal 2010 Compensation

Base Salary.Early in fiscal 2010, we determined that the fiscal 2009 base salary of each executive officer generally continued to be
competitive,
fair and reasonable after reviewing the base salaries of the Company's peer group and consideration of the other factors noted above. The Committee deemed it
appropriate to increase each executive officer's base salary for fiscal 2010 by 3%. The Committee arrived at its decision based on its view that it was important to convey that, despite the general
economic conditions and the impact of the economy on the Company's results of operations, the Company remained healthy, financially secure and committed to paying competitive compensation to its
current employees and to future candidates for employment with the Company.

In
November 2008, Mr. Perry and Ms. McDowell voluntarily requested a 25% reduction in their base salaries for one year. In making their request, Mr. Perry and
Ms. McDowell expressed, among other things, their desire to accentuate the greater prominence the Committee is placing on the long-term performance based aspect of their overall
compensation. On December 12, 2008, the Committee ratified the request and, effective November 1, 2008, their salaries were reduced by 25%. Ms. McDowell's salary was restored to
100% on November 2, 2009, but Mr. Perry and the Committee agreed to continue Mr. Perry's salary reduction for another year.

Annual Incentive/Non-Equity.During fiscal 2009, the Committee established criteria for the annual non-equity incentive plan
for five fiscal years for the executives in order to incent them to take a long-term view of the business and to encourage retention. The Committee determined that operating free cash flow
growth was the appropriate criteria for the executives because it takes into consideration financing decisions and capital allocation as well as operating results. The Committee established fiscal
2008 operating free cash flow of approximately $63 million as the base and set a target for each of the next five years of 12% compounded growth in operating free cash flow. For each fiscal
year in which operating free cash flow growth is at least target, then the bonus payout to the chief executive officer and his direct reports shall be at target. Measurements would be made quarterly
and payments would be made quarterly at 80% of the calculated result. A final calculation would be made at fiscal year-end and the payments "trued-up" to actual, if necessary.
The Committee retained discretion to increase the amount actually paid by up to 25% of the bonus amount based on individual performance. In the event that actual operating free cash flow growth for
any fiscal year exceeds target, then the chief executive officer and his direct reports will earn a percentage of each executive's salary, which will be "banked." If operating free cash flow for
fiscal 2013 meets or exceeds the established target, then the chief executive officer and his direct reports will be paid target for fiscal 2013, plus the entire banked amount.

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As
discussed above, long-term incentive awards made during fiscal 2010 were based on performance during fiscal 2009. Based on performance in fiscal
2009 the Committee granted restricted stock to the executives in July 2009 as follows:

Executive

Shares(#)

Cash($)

Total Value($)Mr. Perry


175,612

$
762,454

$
3,049,800Mr. Black


61,464


266,861


1,067,430Ms. McDowell


107,065


464,839


1,859,361Mr. Quatmann


17,795


77,266


309,046Mr. Keller


19,610


85,141


340,561


Each
executive's fiscal 2009 award was at target based on the targeted total compensation mix established by the Committee. The awards for fiscal 2009 were at target because the Company's growth in
operating free cash flow in fiscal 2009 met target. 75% of such value was delivered in shares of restricted stock and 25% in cash. The shares of restricted stock vest in three (3) equal annual
installments beginning on July 23, 2010. The dollar value of each executive's award was determined based on Company performance in fiscal 2009 and Mr. Perry's recommendation.

Based
on performance in fiscal 2010 the Committee granted restricted stock to the executives in July 2010 as follows:

Executive

Shares(#)

Cash($)

Total Value($)Mr. Perry


49,012

$
142,380

$
569,520Mr. Black


24,506


71,190


284,760Ms. McDowell


40,843


118,653


474,600Mr. Quatmann


24,506


71,190


284,760Mr. Keller


24,506


71,190


284,760


The
basis for each executive's fiscal 2010 award was a targeted total compensation mix established by the Committee (see discussion above), adjusted so that the two-year average value of
each executive's long-term incentive award approximated the median for the peer group. Consistent with past practice, 75% of such value was delivered in shares of restricted stock and 25%
in cash. The shares of restricted stock vest in three (3) equal annual installments beginning on July 26, 2011. The dollar value of each executive's award was determined based on Company
performance in fiscal 2010 and Mr. Perry's recommendation.

Employment Agreements

The Company generally seeks to enter into employment agreements with corporate executives having the title of vice president and above
and with the general manager of each of its gaming properties. In arriving at this determination, the Company sought to minimize the number of individuals with whom it had employment agreements while
at the same time achieving the objectives set forth below. Relevant to this approach, the Company considers the standard competitive practices in the gaming industry.

There
are a number of strategic objectives that the Company expects to achieve by entering into employment agreements with certain key employees:



97

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Some
of the key terms of the Company's employment agreements with Named Executive Officers are:

Term.The initial term of the employment agreements for the Named Executive Officers is one year; provided however that the Chairman
and Chief
Executive Officer is two years. The employment agreements renew for successive one-year terms unless notice is provided or the agreement is terminated earlier. The Company believes that
the term of each employment term represents a reasonable period for which the Company and the executive will mutually commit to maintain the employment relationship. For the Company, this provides
stability and predictability among its leadership ranks. For the executive, this provides a reasonable but limited assurance of job security designed to foster an environment of entrepreneurial risk
taking where the executive can focus on building long-term shareholder value.

Termination and Restrictive Covenants.The Company offers certain additional payments to its Named Executive Officers if the Company
elects to
terminate the executive's employment without "cause" or as a result of death or total disability. Each employment agreement contains a set of restrictive covenants designed to provide the Company with
a reasonable degree of protection of its strategic plans, intellectual property and human capital. Generally, each employment agreement contains prohibitions on (i) competition,
(ii) solicitation of employees, and (iii) disclosure and use of confidential information, which prohibitions remain in place for one year following termination. The Board selected this
time period based on its determination about the extent to which each individual's tenure with, and knowledge of, the Company might be used to adversely impact the Company's strategic plans,
intellectual property or human capital.

Change in Control.In the event of a change in control, each Named Executive Officer is entitled to receive certain additional payments
if employment
is terminated. The Company believes that these payments provide an effective retention mechanism in connection with a change in control.

For
a detailed discussion of the terms contained in each Named Executive Officer's employment agreement, please see below "Employment Contracts".

Other Compensation Policies

Equity Grant Policy

The Committee's procedure for timing of equity grants help to provide assurance that grants are never manipulated or timed to result in
favorable pricing for executives. The Company schedules Board and Committee meetings in advance. Meeting schedules and award decisions are made without regard to the timing of Company SEC filings or
press releases.

Equity
awards are granted on the date approved by the Committee or, in the case of new hires, pursuant to the terms of an employment agreement. If the equity award is a stock option, the
stock option exercise price is based on the average market price of the trading date on which the options are granted. The average price is calculated by adding the highest and lowest price for that
date and dividing by two.

Stock Holding Policy

The Committee encourages executives to manage from an owner's perspective by having and maintaining an equity stake in the Company. To
that end, all of our executives are also stockholders of

98

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the
Company. In January 2009, the Board adopted the Isle of Capri Casinos, Inc. Stock Holding Policy. The Stock Holding Policy provides that members of the Board of Directors and certain
members of management are required to hold a certain percentage of the shares of our common stock received by them upon lapse of the restrictions on restricted stock and upon exercise of stock options
(net of any shares utilized to pay for tax withholding and the exercise price of the option). The percentage ranges from 20% for our general managers to 50% for members of our Board of Directors, our
chief executive officer and his direct reports.

Impact of Prior Compensation

Amounts realized from prior compensation grants did not serve to increase or decrease, fiscal 2010 compensation grants or amounts. The
Company's and the Committee's primary focus is competitive pay opportunities on an annual basis.

Risk Management Practices and Risk-Taking Incentives

In fiscal 2010 we reviewed our material compensation policies and practices and reported to the Committee that we concluded that these
policies and practices do not entail risks reasonably likely to have a material adverse effect on the Company.

Tax Deductibility of Compensation Programs

Section 162(m) of the Code limits our deduction for compensation paid to the Named Executive Officers to $1 million
unless certain requirements are met. The policy of the Committee with regard to Section 162(m) of the Code is to establish and maintain a compensation program that will optimize the
deductibility of compensation. The Committee reserves the right to use its judgment, where merited by the Committee's need for flexibility to respond to changing business conditions or by an
executive's individual performance, to authorize compensation that may not, in a specific case, be fully deductible.

Fiscal 2011 Compensation Actions

In April 2010, the Committee reviewed the peer group to determine whether any changes were warranted from the prior year's peer group.
For fiscal 2011, the Committee determined, based on Towers Watson's recommendation, that the peer group to be used for benchmarking purposes would consist of the following publicly traded
gaming/entertainment companies: Ameristar Casinos, Inc., Boyd Gaming Corp., Gaylord Entertainment, Co., Las Vegas Sands Corp., MGM Mirage, MTR Gaming Group, Inc., Penn National
Gaming, Inc., Pinnacle Entertainment, Inc., Vail Resorts, Inc. and Wynn Resorts Ltd. In addition, the Committee will take into consideration any
available compensation data from the following privately held companies: Harrah's Entertainment, Inc., Jacobs Entertainment Inc., Mohegan Tribal Gaming Authority and Peninsula
Gaming LLC.

Summary Compensation Table

The following table sets forth information concerning the compensation earned during the fiscal year ended April 25, 2010 by the
Company's principal executive officer, principal financial officer, and three other most highly compensated individuals serving as executive officers on the last day of such fiscal year (collectively,
the "Named Executive Officers"). Additionally, to the extent the Named

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Executive
Officer was included in last year's table, the table also includes compensation earned during the fiscal years ended April 25, 2010, April 26, 2009 and April 27, 2008:

Name & Principal Position

Fiscal
Year

Salary
($)

Bonus
($)(1)

Stock
Awards
($)(2)

Options
Awards
($)(2)

Non-Equity
Incentive Plan
Compensation
($)(3)

All Other
Compensation
($)(4)

Total
($)James B Perry


2010


617,308


762,454


2,287,346





462,025





4,129,133Chairman and Chief


2009


707,692


78,421


235,259





480,000





1,501,372Executive Officer(5)


2008


92,308








1,865,797





560


1,958,665Dale R. Black


2010


462,987


266,861


800,569





267,686


12,739


1,810,842Senior Vice President and


2009


436,538


75,286


225,847





262,500


139,081


1,139,252Chief Financial Officer(6)


2008


138,462








681,313


57,067


2,547


879,389Virginia M. McDowell


2010


596,576


464,839


1,394,522





398,496





2,854,433President and Chief


2009


587,385


275,251


825,766





399,000





2,087,402Operating Officer(7)


2008


475,000








2,552,400


208,650


7,563


3,243,613Edmund L. Quatmann, Jr.


2010


375,578


77,266


231,780





217,152


44,851


946,627Senior Vice President,General Counsel and SecretaryPaul B. Keller


2010


344,624


85,141


255,420





199,248


14,492


898,925Senior Vice President andChief Development Officer


(1)The
amounts in this column relate to cash awards granted under the annual long-term incentive plan.(2)The
amounts in this column represent the aggregate grant date fair value of awards granted during the respective fiscal year computed in accordance with
FASB ASC Topic 718, CompensationStock Compensation. The awards granted in fiscal 2010 were for performance in fiscal 2009. The assumptions used in the calculation of these amounts are
disclosed in Note 10 to our Consolidated Financial Statements included herein with the exception that for the employees no forfeiture rate is applied.(3)The
amounts in this column relate to cash awards granted under the annual incentive bonus plan.(4)Other
compensation less than $10,000 total for the 2010 fiscal year is not included. The amounts in this column consist of the following: for
Mr. Black, $4,125 in matching contributions under the 401(k) plan, $4,591 in expenses reimbursed under the MERP, $90 in company-paid life insurance premiums, $3,933 in tax
gross-up expenses; for Mr. Quatmann, $4,125 in matching contributions under the 401(k) plan, $810 in expenses reimbursed under the MERP, $56 in company-paid life
insurance premiums, $33,333 in sign-on incentives, $512 in tax gross-up expenses, $6,015 in relocation reimbursements; and for Mr. Keller, $4,858 in matching
contributions under the 401(k) plan, $5,610 in expenses reimbursed under the MERP, $258 in company-paid life insurance premiums, $3,766 in tax gross-up expenses.(5)Mr. Perry
began serving as our Chief Executive Officer effective March 10, 2008.(6)Mr. Black
joined the Company on December 12, 2007.(7)Ms. McDowell
joined the Company on July 30, 2007.


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Grants of Plan-Based Awards

The following table sets forth certain information regarding grants of plan-based awards during fiscal 2010:

Estimated future payments under
non-equity incentive plan awards(1)All other stock
awards;
number of
shares of stock
or units (#)(2)Grant date fair
value of stock
and option
awards($)(3)Name

Grant
Date

Threshold
($)

Target
($)

Maximum
($)James B. Perry


4/27/2009


384,000


480,000


N/A7/23/2009











175,612


2,287,346Dale R. Black


4/27/2009


222,480


278,100


N/A7/23/2009











61,464


800,569Virginia M. McDowell


4/27/2009


331,200


414,000


N/A7/23/2009











107,065


1,394,522Edmund L. Quatmann, Jr.


4/27/2009


180,480


225,600


N/A7/23/2009











17,795


231,780Paul B. Keller


4/27/2009


165,600


207,000


N/A7/23/2009











19,610


255,420


(1)These
amounts reflect awards for fiscal 2010 pursuant to the Company's annual incentive plan, which provides for the payment of incentive compensation upon
the Company's achievement of a pre-established goal. Based on the Company's operating free cash flow for fiscal 2010, the executives received 96% of the annual target as a payout. See the
discussion above in "Compensation Discussion and Analysis".(2)The
awards granted in fiscal 2010 were for performance in fiscal 2009. The restrictions on the restricted stock awards lapse in 33.33% installments on each
of the first, second and third anniversaries of the date of grant. In the event of a change of control, the forfeiture restrictions on restricted stock lapse immediately.(3)The
amounts in this column represent the aggregate grant date fair value of awards granted during the 2010 fiscal year computed in accordance with FASB ASC
Topic 718, CompensationStock Compensation. The assumptions used in the calculation of these amounts for stock option awards are disclosed in Note 10 to our Consolidated Financial
Statements included herein with the exception that for the employees no forfeiture rate is applied.


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Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information concerning outstanding equity awards as of April 25, 2010, the last day of fiscal
2010:

Stock awardsOption awards

Number
of
shares or
units of
stock that
have not
vested
(#)(2)Name

Number of Securities
Underlying
Unexercised
Options
Exercisable (#)(1)

Number of Securities
Underlying
Unexercised
Options
Unexercisable (#)(1)

Option
Exercise
Price
($)

Option
Expiration
Date

Market value
of shares or
units of stock
that have not
vested ($)(3)James B. Perry


200,000


300,000

$
8.44


3/10/2018

















25,296

$
295,457











3,572


41,721











175,612


2,051,148Dale R. Black














24,284


283,637











27,778


324,447











61,464


717,900Virginia M. McDowell














88,792


1,037,091











41,667


486,671











107,065


1,250,519Edmund L. Quatmann, Jr.


22,000


88,000


4.62


7/1/2018

















17,795


207,846Paul B. Keller


20,000


80,000


6.69


5/1/2018

















19,610


229,045


(1)The
vesting schedule for the options is five years with the first vesting occurring on the one year anniversary of the grant date and then annually
thereafter.(2)Set
forth below is the grant date, vesting schedule and the date each award is vested in full for the stock that has not vested:


Name

Number of
shares of
stock that
have not
vested (#)

Grant Date

Vesting Schedule

Vesting Date (date
award is vested in
full)James B. Perry


25,296


10/6/08

Ratably over 3 years


10/6/20113,572


10/8/08

100% in Year 3


10/8/2011175,612


7/23/09

Ratably over 3 years


7/23/2012Dale R. Black


24,284


10/6/08

Ratably over 3 years


10/6/201127,778


10/8/08

100% in Year 3


10/8/201161,464


7/23/09

Ratably over 3 years


7/23/2012Virginia M. McDowell


88,792


10/6/08

Ratably over 3 years


10/6/201141,667


10/8/08

100% in Year 3


10/8/2011107,065


7/23/09

Ratably over 3 years


7/23/2012Edmund L. Quatmann, Jr.


17,795


7/23/09

Ratably over 3 years


7/23/2012Paul B. Keller


19,610


7/23/09

Ratably over 3 years


7/23/2012


(3)The
aggregate market value of the shares of stock that have not vested was computed by multiplying $11.68 (the closing market price of a share of Company
common stock on April 23, 2010) by the number of unvested shares outstanding as of April 25, 2010, for such executive.




Potential Payments Upon Termination or Change of Control

The information below describes and quantifies compensation that would become payable under existing arrangements in the event of a
termination of each Named Executive Officer's employment under several different circumstances or a change in control. The amounts shown assume that such termination or change in control was effective
as of April 25, 2010, and thus include amounts earned

102

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through
such time and are estimates of the amounts that would be paid to the Named Executive Officers upon their termination or a change in control. The actual amounts to be paid can only be
determined at the time of such Named Executive Officer's separation from the Company or a change in control.

The
following tables quantify the amounts payable to each of the Named Executive Officers under the described termination circumstances and upon a change in control.

James B. Perry

Voluntary
Resignation

Resignation
for Good
Reason

Involuntary
Termination
For Cause

Involuntary
Termination
w/o Cause

Death

Disability

Change
In
Control
Only

Change In
Control and
TerminationVested Stock Option Spread Value

$
648,000

$
648,000

$
648,000

$
648,000

$
648,000

$
648,000

$
648,000

$
648,000Unvested Stock Option Spread Value










$
324,000

$
972,000

$
972,000

$
972,000

$
972,000Restricted Stock Value













$
2,388,326

$
2,388,326

$
2,388,326

$
2,388,326Cash SeveranceSalary Continuation










$
800,000

$
800,000

$
800,000




$
1,600,000Cash SeveranceAnnual Bonus(1)













$
240,000

$
240,000




$
240,000Bonus for Year of Termination(2)










$
462,025

$
462,025

$
462,025




$
462,025Continued Health and Welfare










$
42,994

$
42,994

$
42,994




$
85,988Total

$
648,000

$
648,000

$
648,000

$
2,277,019

$
5,553,345

$
5,553,345

$
4,008,326

$
6,396,339


Dale R. Black

Voluntary
Resignation

Resignation
for Good
Reason

Involuntary
Termination
For Cause

Involuntary
Termination
w/o Cause

Death

Disability

Change
In
Control Only

Change
In
Control and
TerminationVested Stock Option Spread Value

$


$


$


$


$


$


$


$
Unvested Stock Option Spread Value























Restricted Stock Value













$
1,325,984

$
1,325,984

$
1,325,984

$
1,325,984Cash SeveranceSalary Continuation










$
463,500

$
463,500

$
463,500




$
927,000Cash SeveranceAnnual Bonus(1)













$
199,730

$
199,730




$
199,730Bonus for Year of Termination(2)










$
267,686

$
267,686

$
267,686




$
267,686Continued Health and Welfare










$
35,269

$
35,269

$
35,269




$
70,538Total

$


$


$


$
766,455

$
2,292,170

$
2,292,170

$
1,325,984

$
2,790,939


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Virginia M. McDowell

Voluntary
Resignation

Resignation
for Good
Reason

Involuntary
Termination
For Cause

Involuntary
Termination
w/o Cause

Death

Disability

Change
In
Control Only

Change
In
Control and
TerminationVested Stock Option Spread Value

$


$


$


$


$


$


$


$
Unvested Stock Option Spread Value























Restricted Stock Value













$
2,774,280

$
2,774,280

$
2,774,280

$
2,774,280Cash SeveranceSalary Continuation










$
690,000

$
690,000

$
690,000




$
1,380,000Cash SeveranceAnnual Bonus(1)













$
331,279

$
331,279




$
331,279Bonus for Year of Termination(2)










$
398,496

$
398,496

$
398,496




$
398,496Continued Health and Welfare










$
48,036

$
48,036

$
48,036




$
96,073Total

$


$


$


$
1,136,532

$
4,242,091

$
4,242,091

$
2,774,280

$
4,980,128


Edmund L. Quatmann, Jr.

Voluntary
Resignation

Resignation
for Good
Reason

Involuntary
Termination
For Cause

Involuntary
Termination
w/o Cause

Death

Disability

Change
In
Control Only

Change
In
Control and
TerminationVested Stock Option Spread Value

$
155,320

$
155,320

$
155,320

$
155,320

$
155,320

$
155,320

$
155,320

$
155,320Unvested Stock Option Spread Value










$
155,320

$
621,280

$
621,280

$
621,280

$
621,280Restricted Stock Value













$
207,846

$
207,846

$
207,846

$
207,846Cash SeveranceSalary Continuation










$
376,000

$
376,000

$
376,000




$
752,000Cash SeveranceAnnual Bonus(1)













$
182,500

$
182,500




$
182,500Bonus for Year of Termination(2)










$
217,152

$
217,152

$
217,152




$
217,152Continued Health and Welfare










$
30,894

$
30,894

$
30,894




$
61,778Total

$
155,320

$
155,320

$
155,320

$
934,686

$
1,790,992

$
1,790,992

$
984,446

$
2,197,886


104

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Paul B. Keller

Voluntary
Resignation

Resignation
for Good
Reason

Involuntary
Termination
For Cause

Involuntary
Termination
w/o Cause

Death

Disability

Change
In
Control Only

Change
In
Control and
TerminationVested Stock Option Spread Value

$
99,900

$
99,900

$
99,900

$
99,900

$
99,900

$
99,900

$
99,900

$
99,900Unvested Stock Option Spread Value













$
399,600

$
399,600

$
399,600

$
399,600Restricted Stock Value













$
229,045

$
229,045

$
229,045

$
229,045Cash SeveranceSalary Continuation










$
345,000

$
345,000

$
345,000




$
690,000Cash SeveranceAnnual Bonus(1)













$
201,000

$
201,000




$
201,000Bonus for Year of Termination(2)























Continued Health and Welfare










$
30,786

$
30,786

$
30,786




$
46,180Total

$
99,900

$
99,900

$
99,900

$
475,686

$
1,305,331

$
1,305,331

$
728,545

$
1,665,725


Note: No retirement scenario shown as no executive is retirement eligible. (1)Partial year bonuses have been annualized for purposes of the calculation of the three-year average(2)Based on actual bonus paid for FY10 performance


Employment Contracts

We have employment agreements with each of our Named Executives Officers. Below is a summary of each agreement as currently in effect:

In
July 2007, we entered into an employment agreement with Virginia M. McDowell, our current President and Chief Operating Officer. The material terms of Ms. McDowell's employment
agreement are set forth below:



In
December 2007, we entered into an employment agreement with Dale R. Black, our current Senior Vice President and Chief Financial Officer. The material terms of Mr. Black's
employment agreement are substantially the same as Ms. McDowell's agreement. Mr. Black's initial annual base salary was $400,000 and he is eligible for an annual incentive bonus of 60%
of his annual base salary. Mr. Black also received an initial stock option grant to purchase 125,000 shares of the Company's common stock, vesting over a five-year period.

105

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In March 2008, we entered into an employment agreement with James B. Perry, our current Chief Executive Officer. The material terms of Mr. Perry's employment agreement are
substantially the same as Ms. McDowell's agreement; provided, however, that Mr. Perry's initial term was two years. Mr. Perry's initial annual base salary was $800,000.
Mr. Perry also received an initial stock option grant to purchase 500,000 shares of the Company's common stock, vesting over a five-year period. Mr. Perry's agreement also
provides that, in the event of a termination without cause, any unvested stock options that would have vested had employee remained employed for one year following the date of termination shall vest
and become exercisable.

In
May 2008, we entered into an employment agreement with Paul B. Keller, our current Senior Vice President and Chief Development Officer. The material terms of the employment agreement
are as follows:



In
July 2008, we entered into an employment agreement with Edmund L. Quatmann, Jr., our current Senior Vice President, General Counsel and Secretary. The material terms of the employment
agreement are substantially the same as Ms. McDowell's agreement and Mr. Black's agreement. Mr. Quatmann's initial annual base salary was $365,000 and he is eligible for an annual
incentive bonus of 60% of his annual base salary. Mr. Quatmann also received an initial stock option grant to purchase 110,000 shares of the Company's common stock, vesting over a
five-year period.

106

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In
December 2008, we amended the employment agreements between us and each of Messrs. Perry, Black and Quatmann and Ms. McDowell to comply with Section 409A of the
Internal Revenue Code of 1986, as amended.

COMPENSATION OF DIRECTORS

For the one-year term that commenced October 6, 2009, our non-employee directors received a $50,000
annual retainer, additional compensation of $4,000 for each in-person board meeting attended, $2,000 for each in-person meeting with management that they were required to
attend and $1,000 for any other in-person meeting they were required to attend; provided, however, that the Vice Chairman of the Board received an annual retainer of $100,000 in lieu of
the standard annual retainer and per meeting fees. The Chairmen of the Company's Audit Committee and Stock Option and Compensation Committee, Messrs. Glazer and Hayes, respectively, each
receive an additional annual retainer of $25,000 and $7,500, respectively, for chairing those Committees, and the Chairman of the Company's Compliance Committee, Mr. Baker, receives a fee of
$2,000 per meeting. Directors are also eligible for annual long-term incentive awards. For the one-year term that commenced October 6, 2009, each
non-employee director at-large was awarded 13,202 shares of restricted stock, our Vice Chairman was awarded 24,204 shares of restricted stock. The awards vest 50% upon issuance
and 50% on the one-year anniversary of issuance. Directors who are our employees (i.e., our Chairman) receive no additional compensation for serving as directors. All directors are
reimbursed for travel and other expenses incurred in connection with attending board meetings and meetings with management that they may be required to attend.

Director
compensation for the one-year term commencing October 5, 2010 has not yet been set.

Fiscal 2010 Director Compensation

The following table sets forth information with respect to all compensation awarded the Company's directors during fiscal 2010:

Name(1)

Fees earned
or paid in
cash
($)

Stock Awards
($)(2)

All other
compensation
($)(3)

Total
($)W. Randolph Baker


72,000


150,173





222,173John G. Brackenbury(4)


70,000


150,173


60,000


280,173Alan J. Glazer


100,000


165,199





265,199Jeffery D. Goldstein


78,000


150,173





228,173Richard A. Goldstein


71,000


188,086





259,086Robert S. Goldstein


100,000


275,321





375,321Shaun R. Hayes


86,500


160,194





246,694Gregory J. Kozicz(5)


43,000


28,181





71,181Lee S. Wielansky


75,000


150,173





225,173


(1)James
B. Perry, our Chief Executive Officer and the Chairman of our Board of Directors, is a Named Executive Officer and his compensation as Chief Executive
Officer is included in the Summary Compensation Table. He does not receive additional compensation for his service as a director.(2)The
amounts in this column represent the aggregate grant date fair value of awards granted during fiscal 2010 computed in accordance with FASB ASC Topic
718, CompensationStock Compensation. The assumptions used in the calculation of these amounts for stock awards are disclosed in Note 10 to our Consolidated Financial Statements
included herein with the exception that for the directors no forfeiture rate is applied.


107

---



(3)Occasionally
the spouse of a director accompanies the director on travel to Board meetings at our expense. This column does not include this cost, which is
minimal.(4)Mr. Brackenbury
received $60,000 in fees for serving on the Board of Directors of The Isle Casinos Limited.(5)Mr. Kozicz
joined the Board on January 27, 2010. The amount included in the "Stock Awards" column for Mr. Kozicz reflects his initial
award of 3,333 shares of restricted stock for joining the Board.


COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

There are no Stock Option and Compensation Committee interlocks (i.e., none of our executive officers serves as a member of the
board of directors or the compensation committee of another entity that has an executive officer serving as a member of our Board or the Stock Option and Compensation Committee of our Board).

STOCK OPTION AND COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Stock Option and Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis contained herein and,
based on such review and discussions, the Stock Option and Compensation Committee recommended that the Compensation Discussion and Analysis be included here.

By:
The Stock Option and Compensation Committee:

Shaun
R. Hayes, Chair
W. Randolph Baker
John G. Brackenbury
Alan J. Glazer
Gregory J. Kozicz
Lee S. Wielansky

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Equity Compensation Plans.The following table provides information about securities authorized for issuance under our 2009 Long-Term
Stock Incentive Plan for the fiscal 2010.

(a)

(b)

(c)Plan category

Number of securities
to be issued
upon exercise of
outstanding options,
warrants and rights

Weighted-average
exercise price of
outstanding options,
warrants and rights

Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column (a))Equity compensation plans approved by security holders


1,435,185

$
11.29


2,220,296Equity compensation plans not approved by security holders








Total


1,435,185

$
11.29


2,220,296


Ownership of Our Capital Stock.The following table sets forth information with respect to the beneficial ownership of our common stock
as of
August 13, 2010 (unless otherwise indicated) by:

108

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(1) each
director and nominee for director, (2) the individuals named in the Summary Compensation Table (i.e., the Named Executive Officers), (3) all directors, nominees
for director and executive officers (including the Named Executive Officers) as a group, and (4) based on information available to us and filings made under Sections 13(d) and 13(g) of
the Securities Exchange Act of 1934, as amended, each
person known by us to be the beneficial owner of more than 5% of our common stock. Unless otherwise indicated, all persons listed have sole voting and dispositive power over the shares beneficially
owned.

Name and Address of Beneficial Owners(1)

Number of Shares of
Common Stock
Beneficially Owned(2)

Percentage of
Outstanding
Shares Owned(2)Robert S. Goldstein(3)(4)


14,160,133

43.2%Jeffrey D. Goldstein(3)(5)


13,642,746

41.6%Richard A. Goldstein(3)(6)


13,495,126

41.2%B.I.J.R.R. Isle, Inc.(3)(7)


9,273,115

28.3%B.I. Isle Partnership, L.P.(3)(8)


4,502,625

13.7%Goldstein Group, Inc.(3)(9)


2,898,243

8.8%Thompson, Siegel & Walmsley LLC(10)


1,712,948

5.2%W. Randolph Baker(11)


47,830

*John G. Brackenbury(12)


36,431

*Alan J. Glazer(13)


91,589

*Shaun R. Hayes(14)


34,123

*Gregory J. Kozicz (15)


3,333

*James B. Perry(16)


516,141

1.6%Lee S. Wielansky(17)


37,237

*Virginia M. McDowell(18)


342,763

1.0%Dale R. Black(19)


157,675

*Arnold L. Block(20)


32,020

*R. Ronald Burgess(21)


44,653

*D. Douglas Burkhalter(22)


60,353

*Roger W. Deaton (23)


140,774

*Eric L. Hausler (24)


40,422

*Paul B. Keller(25)


84,116

*Donn R. Mitchell, II(26)


97,851

*Edmund L. Quatmann, Jr.(27)


86,301

*Jeanne-Marie Wilkins(28)


58,512

*Directors and Executive Officers as a Group (21 persons)(29)


19,301,409

58.1%


*Less
than 1%. Notes: (1)Unless
otherwise indicated below, the business address for each member or affiliated entity of the Goldstein family listed below is 2117 State Street,
Bettendorf, Iowa 52722.(2)Calculated
pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as amended. Under Rule 13d-3(d), shares
not currently outstanding that are subject to options, warrants, rights or conversion privileges exercisable within 60 days of August 13, 2010, are deemed outstanding for the purpose of
calculating the number and percentage owned by such person, but are not deemed outstanding for the purpose of calculating the percentage owned by any other person listed.(3)Information
regarding beneficial ownership of our common stock is included herein in reliance on Schedule 13D/A as filed with the SEC on
May 14, 2010 and June 29, 2010. Further, on April 30,


109

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2010,
members of the Goldstein family, including Robert S. Goldstein, Jeffrey D. Goldstein, Richard A. Goldstein and various family trusts and other entities associated with members of the Goldstein
family (the "Goldstein Group") entered into an Agreement related to their ownership of our common stock (the "Goldstein Family Agreement"). The Goldstein Family Agreement includes, among other things,
an agreement by the parties to coordinate their efforts with each other with respect to their ownership of our common stock and to ensure that the interests of the Goldstein Group are appropriately
considered by our Board of Directors. As of June 29, 2010, the Goldstein Group beneficially owned in the aggregate approximately 50.1% of the issued and outstanding shares of our common stock. (4)The
number of shares beneficially owned by Robert S. Goldstein includes 9,273,115 shares of which Robert S. Goldstein, as Co-Chairman and Chief
Executive Officer of B.I.J.R.R. Isle, Inc., has indirect beneficial ownership, 2,898,243 shares held by the Goldstein Group, Inc., of which Robert S. Goldstein has indirect beneficial
ownership, 540,000 shares held in the Richard A. Goldstein Irrevocable Trust, of which Robert S. Goldstein, as co-trustee, has indirect beneficial ownership, 540,000 shares held in the
Jeffrey D. Goldstein Irrevocable Trust, of which Robert S. Goldstein, as co-trustee, has indirect beneficial ownership, 75,000 shares in a family private foundation of which he is a
director, 24,476 shares held in an IRA account over which Mr. Goldstein has a power of attorney which includes voting and dispositive power and 28,333 shares of restricted stock subject to
vesting. Such indirect beneficial ownership arises from the power to vote or to direct the vote or the power to dispose or direct the disposition of such shares and does not necessarily constitute a
personal ownership interest in such shares. The business address of Robert S. Goldstein is 700 Office Parkway, St. Louis, Missouri 63141.(5)The
number of shares beneficially owned by Jeffrey D. Goldstein includes 9,273,115 shares of which Jeffrey D. Goldstein, as Co-Chairman and
Chief Executive Officer of B.I.J.R.R. Isle, Inc. (the sole general partner of B.I. Isle Partnership, L.P., Rob Isle Partnership, L.P., Rich Isle Partnership, L.P., Jeff
Isle Partnership, L.P. and I.G. Isle Partnership, L.P.), has indirect beneficial ownership, 2,898,243 shares held by the Goldstein Group, Inc., of which Jeffrey D. Goldstein has
indirect beneficial ownership, 540,000 shares held in the Richard A. Goldstein Irrevocable Trust, of which Jeffrey D. Goldstein, as co-trustee, has indirect beneficial ownership, 75,000
shares in a family private foundation of which he is a director, 24,476 shares held in an IRA account over which Mr. Goldstein has a power of attorney which includes voting and dispositive
power and 14,803 shares of restricted stock subject to vesting. Such indirect beneficial ownership arises from the power to vote or to direct the vote or the power to dispose or direct the disposition
of such shares and does not necessarily constitute a personal ownership interest in such shares. The business address of Jeffrey D. Goldstein is 2117 State Street, Suite 300, Bettendorf, Iowa
52722.(6)The
number of shares beneficially owned by Richard A. Goldstein includes 9,273,115 shares of which Richard A. Goldstein, as Co-Chairman and
Chief Executive Officer of B.I.J.R.R. Isle, Inc. has indirect beneficial ownership, 2,898,243 shares held by the Goldstein Group, Inc., of which Richard A. Goldstein has indirect
beneficial ownership, 540,000 shares held in the Jeffrey D. Goldstein Irrevocable Trust, of which Richard A. Goldstein, as co-trustee, has indirect beneficial ownership, 75,000 shares in a
family private foundation of which he is a director, 24,476 shares held in an IRA account over which Mr. Goldstein has a power of attorney which includes voting and dispositive power and 8,268
shares of restricted stock subject to vesting. Such indirect beneficial ownership arises from the power to vote or to direct the vote or the power to dispose or direct the disposition of such shares
and does not necessarily constitute a personal ownership interest in such shares. The business address of Richard A. Goldstein is 700 Office Parkway, St. Louis, Missouri 63141.(7)B.I.J.R.R.
Isle, Inc. is the general partner of B.I. Isle Partnership, L.P., Rob Isle Partnership, L.P., Rich Isle
Partnership, L.P., Jeff Isle Partnership, L.P. and I.G. Isle Partnership, L.P. and, as such,


110

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has
indirect beneficial ownership of the shares held by each limited partnership. Such indirect beneficial ownership arises from the power to vote or to direct the vote or the power to dispose or
direct the disposition of such shares and does not necessarily constitute a personal ownership interest in such shares. Jeffrey D. Goldstein, Richard A. Goldstein, and Robert S. Goldstein, each as a
Co-Chairman and Chief Executive Officer of B.I.J.R.R. Isle, Inc., have indirect beneficial ownership and report shared voting and dispositive power as to these shares. Such indirect
beneficial ownership arises from the power to vote or to direct the vote or the power to dispose or direct the disposition of such shares and does not necessarily constitute a personal ownership
interest in such shares. The address for B.I.J.R.R. Isle, Inc. is c/o Michael Newmark, Bryan Cave LLP, 211 N. Broadway, Ste. 3600, St. Louis, Missouri 63102. (8)Jeffrey
D. Goldstein, Richard A. Goldstein, and Robert S. Goldstein, each as a Co-Chairman and Chief Executive Officer of B.I.J.R.R.
Isle, Inc., have indirect beneficial ownership and report shared voting and dispositive power as to these shares. Such indirect beneficial ownership arises from the power to vote or to direct
the vote or the power to dispose or direct the disposition of such shares and does not necessarily constitute a personal ownership interest in such shares. The address of B.I. Isle Partnership is c/o
Michael Newmark, Bryan Cave LLP, 211 N. Broadway, Ste. 3600, St. Louis, Missouri 63102.(9)Shares
owned by Goldstein Group, Inc. are reported as beneficially owned by Jeffrey D. Goldstein, Robert S. Goldstein and Richard A. Goldstein. The
address for Goldstein Group, Inc. is 2117 State Street, Suite 300, Bettendorf, Iowa 52722.(10)As
reflected on a Form 13F filed on May 14, 2010 by Thompson, Siegel & Walmsley LLC. The address for Thompson, Siegel &
Walmsley LLC is 6806 Paragon Place, Suite 300, PO Box 6883, Richmond, VA 23230.(11)Includes
2,000 shares issuable upon the exercise of stock options that are exercisable within 60 days and 14,622 shares of restricted stock subject
to vesting.(12)Includes
14,679 shares of restricted stock subject to vesting.(13)Includes
8,000 shares issuable upon the exercise of stock options that are exercisable within 60 days, 16,577 shares of restricted stock subject to
vesting and 1,000 shares owned by Mr. Glazer's wife.(14)Includes
13,331 shares of restricted stock subject to vesting.(15)Includes
1,666 shares of restricted stock subject to vesting.(16)Includes
200,000 shares issuable upon the exercise of stock options that are exercisable within 60 days and 194,954 shares of restricted stock
subject to vesting.(17)Includes
9,885 shares of restricted stock subject to vesting.(18)Includes
242,678 shares of restricted stock subject to vesting.(19)Includes
117,544 shares of restricted stock subject to vesting.(20)Includes
24,123 shares of restricted stock subject to vesting.(21)Includes
38,895 shares of restricted stock subject to vesting.(22)Includes
38,895 shares of restricted stock subject to vesting.(23)Includes
80,975 shares issuable upon the exercise of stock options that are exercisable within 60 days and 22,154 shares of restricted stock subject
to vesting.


111

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(24)Includes
20,000 shares issuable upon exercise of stock options that are exercisable within 60 days and 20,422 shares of restricted stock subject to
vesting.(25)Includes
40,000 shares issuable upon exercise of stock options that are exercisable within 60 days and 37,579 shares of restricted stock subject to
vesting.(26)Includes
30,700 shares issuable upon the exercise of stock options that are exercisable within 60 days and 34,705 shares of restricted stock subject
to vesting.(27)Includes
44,000 shares issuable upon the exercise of stock options that are exercisable within 60 days and 36,369 shares of restricted stock subject
to vesting.(28)Includes
40,000 shares issuable upon the exercise of stock options that are exercisable within 60 days and 14,451 shares of restricted stock subject
to vesting.(29)Information
provided is for the individuals who were our executive officers, directors and nominees for director on August 13, 2010, and includes
465,675 shares issuable upon exercise of stock options that are exercisable within 60 days and 944,933 shares of restricted stock subject to vesting.


ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

CERTAIN RELATED PARTY TRANSACTIONS

Green Bridge Company, a company that is indirectly wholly owned by members of the Goldstein family, including Robert S. Goldstein,
Jeffrey D. Goldstein and Richard A. Goldstein, provides an easement to the Isle of Capri Casino & Hotel in Bettendorf, Iowa for parking at an annual rent of $60,000. Robert S. Goldstein,
Jeffrey D. Goldstein and Richard A. Goldstein are members of our Board of Directors. Robert S. Goldstein is Vice Chairman of our Board of Directors.

It
is our written policy that the Company expects that any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships (including any
indebtedness or guarantee of indebtedness) in which (1) the aggregate amount involved will or may be expected to exceed $120,000 in any calendar year, (2) the Company is a participant,
and (3) any related party has or will have a direct or indirect interest will be either approved or ratified by the unrelated Directors of the Board of Directors. In deciding whether to approve
a related party transaction, the Board of Directors will take into account, among other factors it deems appropriate, whether the transaction is on terms no less favorable than terms generally
available to an unaffiliated third-party under the same or similar circumstances and the extent of the related party's interest in the transaction. If a related party transaction will be ongoing, the
Board of Directors may establish guidelines for the Company's
management to follow in its ongoing dealings with the related party. Thereafter, the Board of Directors, on at least an annual basis, would review and assess ongoing relationships with the related
party to see that the transaction remains appropriate.

INDEPENDENCE

The Board of Directors has determined that the following directors are independent as defined in Nasdaq Rule 5605(a)(2):

W.
Randolph Baker
John G. Brackenbury
Alan J. Glazer
Shaun R. Hayes
Gregory J. Kozicz
Lee S. Wielansky

112

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Additionally,
each of the Stock Option and Compensation Committee, Audit Committee and Nominating Committee is composed entirely of independent directors.

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table summarizes the fees billed to the Company for professional services by Ernst & Young, LLP for fiscal
2010 and 2009:

2010

2009Audit Fees

$
2,278,035

$
2,563,865Audit-Related Fees


49,500


22,825Tax Fees


10,000


All Other Fees





$
2,337,535

$
2,586,690


Audit
fees include fees for professional services rendered for the audit of our annual consolidated financial statements and reports on internal control over financial reporting, the
review procedures on the consolidated financial statements included in our Forms 10-Q, as well as accounting consultations, statutory audits, consents, and other services related to
Securities and Exchange Commission filings. Audit-related fees for 2010 include fees for the audit of our employee benefit plan. Tax fees consist of amounts billed for tax compliance assistance and
tax planning and advice.

The
Audit Committee is responsible for reviewing and pre-approving any non-audit services to be performed by the Company's outside accounting firm. The Audit
Committee may delegate its pre-approval authority to the Chairman of the Audit Committee to act between meetings of the Audit Committee. Any pre-approval given by the Chairman
of the Audit Committee pursuant to this delegation is presented to the full Audit Committee at its next regularly scheduled meeting. The Audit Committee or Chairman of the Audit Committee reviews, and
if appropriate, approves all non-audit service engagements, taking into account the proposed scope of the non-audit services, the proposed fees for
the non-audit services, whether the non-audit services are permissible under applicable law or regulation, and the likely impact of the non-audit services on the
principal accountant's independence.

The
Audit Committee pre-approved each engagement of the Company's independent registered public accounting firm to perform non-audit related services during
fiscal year 2010.

The
Audit Committee has considered whether the provision of non-audit services is compatible with maintaining the principal accountant's independence and believes the
provision of the services referenced above is compatible.

113

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PART IV

ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

The following documents are filed as part of this Form 10-K.



114

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Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

ISLE OF CAPRI CASINOS, INC.Dated: August 23, 2010

By

/s/ JAMES B. PERRY James B. Perry, Chief Executive Officer and
Chairman of the Board


115

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Table of Contents

INDEX TO EXHIBITS

EXHIBIT NUMBER

DESCRIPTION3.1A

Certificate of Incorporation of Casino America, Inc. (Incorporated by reference to the Registration Statement on Form S-1 filed September 3, 1993)3.1B

Amendment to Certificate of Incorporation of Casino America, Inc. (Incorporated by reference to the Proxy Statement for the fiscal year ended April 26, 1998)3.2A

By-laws of Casino America, Inc. (Incorporated by reference to the Registration Statement on Form S-1 filed September 3, 1993)3.2B

Amendment to By-laws of Casino America, Inc., dated February 7, 1997 (Incorporated by reference to Exhibit 3.2A to the Annual Report on Form 10-K filed on July 28, 1997)4.1

Indenture, dated as of March 3, 2004, among Isle of Capri Casinos, Inc., the subsidiary guarantors named therein and U.S. Bank National Association, as Trustee (Incorporated by reference to Exhibit 4.3 to
the Registration Statement on Form S-4 filed on May 12, 2004)4.2

Registration Rights Agreement, dated as of March 3, 2004, among Isle of Capri Casinos, Inc., the subsidiary guarantors named therein and Deutsche Bank Securities Inc. and CIBC World Markets Corp. on
behalf of themselves and as representatives of the other initial purchasers (Incorporated by reference to Exhibit 4.4 to the Registration Statement on Form S-4 filed on May 12, 2004)10.1

Amended Casino America, Inc. 1993 Stock Option Plan (Incorporated by reference to the Proxy Statement filed on August 25, 1997)10.2

Amended and Restated Isle of Capri Casinos, Inc. 2009 Long-Term Stock Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Quarterly Report on From 10-Q on December 4, 2009)10.3

Isle of Capri Casinos, Inc. Deferred Bonus Plan (Incorporated by reference to the Proxy Statement filed on August 15, 2000)10.4

Isle of Capri Casinos, Inc. Deferred Bonus Plan Code Section 409A Compliance Amendment (Incorporated by reference to Exhibit 10.4 to the Annual Report on Form 10-K filed on June 25,
2009)10.5

Isle of Capri Casinos, Inc.'s Amended and Restated Deferred Compensation Plan (Incorporated by reference to Exhibit 10.5 to the Annual Report on Form 10-K filed on June 25, 2009)10.6

Isle of Capri Casino, Inc. Amended and Restated Deferred Compensation Plan Adoption Agreement (Incorporated by reference to Exhibit 10.6 to the Annual Report on Form 10-K filed on June 25,
2009)10.7

Letter of Stock Option and Compensation Committee dated November 1, 2008 (Incorporated by reference to Exhibit 99.1 to the 8-K filed on November 6, 2008)10.8

Isle of Capri Casinos, Inc.'s 2005 Non-employee Director Deferred Compensation Plan (Incorporated by reference to Exhibit 10.33 to the Quarterly Report Form 10-Q filed on March 1, 2005)


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Table of Contents

EXHIBIT NUMBER

DESCRIPTION10.9

Isle of Capri Casinos, Inc. Non-employee Director Deferred Compensation Plan (Incorporated by reference to Exhibit 10.9 to the Annual Report on Form 10-K filed on June 25, 2009)10.10

Isle of Capri Casinos, Inc. Medical Expense Reimbursement Plan (MERP) (Incorporated by reference to Exhibit 10.10 to the Annual Report on Form 10-K filed on June 25, 2009)10.11

Employment Agreement, dated as of July 16, 2007, between Isle of Capri Casinos, Inc. and Virginia McDowell (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on
July 20, 2007)10.12

Employment Agreement dated as of December 3, 2007, between Isle of Capri Casinos, Inc. and Dale R. Black (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on
December 12, 2007)10.13

Employment Agreement, dated as of March 4, 2008, between Isle of Capri Casinos, Inc. and James B. Perry (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on
March 10, 2008)10.14

Employment Agreement, dated as of July 1, 2008, between Isle of Capri Casinos, Inc. and Edmund L. Quatmann, Jr. (Incorporated by reference to Exhibit 10.18 to the Annual Report on Form 10-K filed on
July 11, 2008)10.15

Isle of Capri Casinos, Inc. Employment Agreement Compliance
AddendumJames B. Perry (Incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on March 6, 2009)10.16

Isle of Capri Casinos, Inc. Employment Agreement Compliance
AddendumVirginia M. McDowell (Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed on March 6, 2009)10.17

Isle of Capri Casinos, Inc. Employment Agreement Compliance
AddendumDale R. Black (Incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q filed on March 6, 2009)10.18

Isle of Capri Casinos, Inc. Employment Agreement Compliance
AddendumEdmund L. Quatmann, Jr. (Incorporated by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q filed on March 6, 2009)10.19
**
Employment Agreement dated as of August 6, 2009, between
Isle of Capri Casinos, Inc. and Eric Hausler.10.20
**
Employment Agreement dated as of October 30, 2008, between
Isle of Capri Casinos, Inc. and Paul Keller.10.21

Form Employment Agreement for Senior Vice Presidents of Isle of Capri Casinos, Inc. (Incorporated by reference to Exhibit 10.19 to the Annual Report on Form 10-K filed on July 11, 2008)10.22

Form Stock Option Award Agreement (Incorporated by reference to Exhibit 10.20 to the Annual Report on Form 10-K filed on July 11, 2008)10.23

Form of Restricted Stock Award Agreement (Incorporated by reference to Exhibit 10.22 to the Annual Report on Form 10-K filed on June 25, 2009)


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Table of Contents

EXHIBIT NUMBER

DESCRIPTION10.24

Credit Agreement, dated as of July 26, 2007 among Isle of Capri Casinos, Inc., the Lenders listed herein, Credit Suisse, Cayman Island Branch, as administrative agent, issuing bank and swing line lender, Credit
Suisse Securities (USA) LLC, as lead arranger and bookrunner, Deutsche Bank Securities Inc. and CIBC World Markets Corp., as co-syndication agents and U.S. Bank, N.A. and Wachovia Bank, National Association, as co-documentation agents
(Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 31, 2007)10.25

Security Agreement, dated as of July 26, 2007, among Isle of Capri Casinos, Inc., its material subsidiaries party thereto, and Credit Suisse, Cayman Islands Branch, as Administrative Agent for and representative
of the financial institutions party to the Credit Agreement and any Hedge Providers (as defined therein) (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 31, 2007)10.26

First Amendment to Credit Agreement, dated as of February 17, 2010, among the Company, as borrower, the financial institutions listed therein, as lenders, Credit Suisse AG, Cayman Islands Branch, as administrative
agent and the other agents referred to therein among Isle of Capri Casinos, Inc., the Lenders listed therein. (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on February 29, 2010.10.27

Biloxi Waterfront Project Lease dated May 12, 1986 with Point Cadet Development Corporation (Biloxi) (Incorporated by reference to an exhibit to the Annual Report on Form 10-K for the fiscal year ended
April 30, 1992)10.28

Addendum to Lease Agreement, dated August 1, 1992, between the City of Biloxi, Mississippi, Point Cadet Development Corporation (Biloxi) (Incorporated by reference to an exhibit to the Annual Report on Form 10-K
for the fiscal year ended April 30, 1992)10.29

Second Addendum to Lease, dated April 9, 1994, by and between the City of Biloxi, Mississippi, Point Cadet Development Corporation, the Biloxi Port Commission and Riverboat Corporation of Mississippi (Biloxi)
(Incorporated by reference to an exhibit to the Annual Report on Form 10-K for the fiscal year ended April 30, 1994)10.30

Third Addendum to Casino Lease, dated April 26, 1995, by and between the City of Biloxi, Mississippi, Point Cadet Development Corporation, the Biloxi Port Commission and Riverboat Corporation of Mississippi (Biloxi)
(Incorporated by reference to an exhibit to the Annual Report on Form 10-K for the fiscal year ended April 30, 1995)10.31

Biloxi Waterfront Project Lease dated as of April 9, 1994 by and between the City of Biloxi, Mississippi and Riverboat Corporation of Mississippi (Biloxi) (Incorporated by reference to an exhibit to the Annual Report
on Form 10-K for the fiscal year ended April 30, 1994)10.32

First Amendment to Biloxi Waterfront Project Lease (Hotel Lease), dated as of April 26, 1995, by and between Riverboat Corporation of Mississippi (Biloxi) (Incorporated by reference to an exhibit to the Annual Report
on Form 10-K for the fiscal year ended April 30, 1995)


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Table of Contents

EXHIBIT NUMBER

DESCRIPTION10.33

Point Cadet Compromise and Settlement Agreement, dated August 15, 2002, by and between the Secretary of State of the State of Mississippi, the City of Biloxi, Mississippi, the Board of Trustees of State Institutions
of Higher Learning and Isle of Capri Casinos, Inc. and Riverboat Corporation of Mississippi (Biloxi) (Incorporated by reference to an Exhibit 10.29 to the Annual Report on Form 10-K filed on July 30, 2007)10.34

Biloxi Waterfront Project Garage-Podium Lease and Easement dated as of August 15, 2002, by and between the Secretary of State of the State of Mississippi, the City of Biloxi, Mississippi, the Board of Trustees of
State Institutions of Higher Learning and Isle of Capri Casinos, Inc. and Riverboat Corporation of Mississippi (Biloxi) (Incorporated by reference to an Exhibit 10.30 to the Annual Report on Form 10-K filed on July 30,
2007)10.35

Amended and Restated Berth Rental Agreement dated May 12, 1992 between the Biloxi Port Commission and Riverboat Corporation of Mississippi (Biloxi) (Incorporated by reference to an exhibit to the Annual Report on
Form 10-K for the fiscal year ended April 30, 1992)10.36

Second Amendment to Berth Rental Agreement dated August 13, 1996, (ii) Third Amendment to Berth Rental Agreement dated December 14, 1999 and (iii) Letter Agreement to Berth Rental Agreement dated
October 17, 2006 (Biloxi) (Incorporated by reference to an Exhibit 10.32 to the Annual Report on Form 10-K filed on July 30, 2007)10.37

Agreement on Casino Berth Tract dated as of August 15, 2002, State consented to dredging, wharfing and filling by Isle of areas to reconfigure Berth Tract to accommodate a larger gaming vessel (Biloxi) (Incorporated
by reference to an Exhibit 10.33 to the Annual Report on Form 10-K filed on July 30, 2007)10.38

Amended and Restated Lease, dated as of April 19, 1999, among Port Resources, Inc. and CRU, Inc., as landlords and St. Charles Gaming Company, Inc., as tenant (St. Charles) (Incorporated by
reference to an Exhibit 10.28 to the Annual Report on Form 10-K filed on July 02, 1999)10.39

Lease of property in Coahoma, Mississippi dated as of November 16, 1993 by and among Roger Allen Johnson, Jr., Charles Bryant Johnson and Magnolia Lady, Inc. (Incorporated by reference to the Registration
Statement on Form S-4/A filed June 19, 2002)10.40

Addendum to Lease dated as of June 22, 1994 by and among Roger Allen Johnson, Jr., Charles Bryant Johnson and Magnolia Lady, Inc. (Incorporated by reference to an Exhibit 10.46 to the Annual Report on
Form 10-K filed on July 28, 2000)10.41

Second addendum to Lease dated as of October 17, 1995 by and among Roger Allen Johnson, Jr., Charles Bryant Johnson and Magnolia Lady, Inc. (Incorporated by reference to an Exhibit 10.47 to the Annual
Report on Form 10-K filed on July 28, 2000)10.42

Master Lease between The City of Boonville, Missouri and IOC-Boonville, Inc. formally known as Davis Gaming Boonville, Inc. dated as of July 18, 1997. (Incorporated by reference to an Exhibit 10.40 to
the Annual Report on Form 10-K filed on July 11, 2008)


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Table of Contents

EXHIBIT NUMBER

DESCRIPTION10.43

Amendment to Master Lease between The City of Boonville, Missouri and IOC-Boonville, Inc. formally known as Davis Gaming Boonville, Inc. dated as of April 19, 1999. (Incorporated by reference to an
Exhibit 10.41 to the Annual Report on Form 10-K filed on July 11, 2008)10.44

Second Amendment to Master Lease between The City of Boonville, Missouri and IOC-Boonville, Inc. formerly known as Davis Gaming Boonville, Inc. dated as of September 17, 2001. (Incorporated by reference to
an Exhibit 10.42 to the Annual Report on Form 10-K filed on July 11, 2008)10.45

Third Amendment to Master Lease between The City of Boonville, Missouri and IOC-Boonville, Inc. formerly known as Gold River's Boonville Resort, Inc. and Davis Gaming Boonville, Inc. dated as of
November 19, 2001. (Incorporated by reference to an Exhibit 10.43 to the Annual Report on Form 10-K filed on July 11, 2008)10.46

Amended and Restated Lease Agreement by and between the Port Authority of Kansas City, Missouri and Tenant dated as of August 21, 1995 (Incorporated by reference to Exhibit 10.44 to the Annual Report on
Form 10-K filed June 25, 2009)10.47

First Amendment to Amended and Restated Lease Agreement by and between the Port Authority of Kansas City, Missouri and Tenant dated as of October 31, 1995 (Incorporated by reference to Exhibit 10.45 to the
Annual Report on Form 10-K filed June 25, 2009)10.48

Second Amendment to Amended and Restated Lease Agreement by and between the Port Authority of Kansas City, Missouri and Tenant dated as of June 10, 1996 (Incorporated by reference to Exhibit 10.46 to the Annual
Report on Form 10-K filed June 25, 2009)10.49

Assignment and Assumption Agreement (Lease Agreement) between Flamingo Hilton Riverboat Casino, LP, Isle of Capri Casinos, Inc. and IOC-Kansas City, Inc. dated as of June 6, 2000. (Incorporated by
reference to an Exhibit 10.44 to the Annual Report on Form 10-K filed on July 11, 2008)10.50

Lease and Agreement-Spring 1995 between Andrianakos Limited Liability Company and Isle of Capri Black Hawk, LLC. dated as of August 15, 1995. (Incorporated by reference to an Exhibit 10.45 to the Annual
Report on Form 10-K filed on July 11, 2008)10.51

Addendum to the Lease and Agreement-Spring 1995 between Andrianakos Limited Liability Company and Isle of Capri Black Hawk, LLC. dated as of April 4, 1996. (Incorporated by reference to an Exhibit 10.46 to
the Annual Report on Form 10-K filed on July 11, 2008)10.52

Second Addendum to the Lease and Agreement-Spring 1995 between Andrianakos Limited Liability Company and Isle of Capri Black Hawk, LLC. dated as of March 21, 2003.(Incorporated by reference to an
Exhibit 10.47 to the Annual Report on Form 10-K filed on July 11, 2008)10.53

Third Addendum to the Lease and Agreement-Spring 1995 between Andrianakos Limited Liability Company and Isle of Capri Black Hawk, LLC. dated as of April 22, 2003. (Incorporated by reference to an
Exhibit 10.48 to the Annual Report on Form 10-K filed on July 11, 2008)


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Table of Contents

EXHIBIT NUMBER

DESCRIPTION10.54

Operator's Contract dated August 11, 1994; as amended by: (i) Amendment to Operator's Contract dated August 15, 1998; and (ii) Second Amendment to Operator's Contract dated June 30, 2004
(Bettendorf) (Incorporated by reference to an Exhibit 10.38 to the Annual Report on Form 10-K filed on July 30, 2007)10.55

Purchase Agreement, dated April 1, 2010, by and among United Gaming Rainbow, Inc., Bally Technologies, Inc., Isle of Capri Casinos, Inc., IOC-Vicksburg, Inc. and IOC-Vicksburg, L.L.C., with
respect to Rainbow Casino-Vicksburg Partnership, L.P. d/b/a Rainbow Casino (Incorporated by reference to an Exhibit 99.1 to the Current Report on Form 8-K filed on April 1, 2010)21.1
**
Significant Subsidiaries of Isle of Capri Casinos, Inc.23.1
*
Consent of Ernst & Young LLP31.1
*
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 193431.2
*
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 193432.1
*
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 135032.2
*
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 135099.1
**
Description of Governmental Regulation.


*Filed
herewith.**Previously
filed.Management
contract or compensatory plan or arrangement.


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