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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-K/A

                               AMENDMENT NO. 1 TO


(Mark One)
   [X]              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2001

                                       or

   [_]            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                        Commission file number: 333-06489

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<S>                               <C>                                                      <C>
         Indiana                              THE MAJESTIC STAR CASINO, LLC                    43-1664986

         Indiana                          THE MAJESTIC STAR CASINO CAPITAL CORP.               35-2100872

(State or other jurisdiction of   (Exact name of registrant as specified in its charter)    (I.R.S. Employer
incorporation or organization)                                                             Identification No.)
</TABLE>

                           One Buffington Harbor Drive
                                  Gary, Indiana
                                   46406-3000
                                 (219) 977-7823

        (Registrant's address and telephone number, including area code)
        Securities registered pursuant to section 12(b) of the act: None
        Securities registered pursuant to section 12(g) of the act: None

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 filing requirements
for the past 90 days.

Yes   X  No ______
     ---

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. [X]

The aggregate market value of the voting stock held by non-affiliates of the
registrant: Not Applicable. The Company has no publicly traded equity
securities.

The number of shares of Common Stock issued and outstanding:  Not Applicable.

                    DOCUMENTS INCORPORATED BY REFERENCE: NONE

                                EXPLANATORY NOTE

The Registrant completed the acquisition of the assets of three subsidiaries of
Fitzgeralds Gaming Corporation on December 6, 2001. Financial statements for the
acquired businesses were not available when the Registrant filed its Annual
Report on Form 10-K for the year ended December 31, 2001. In order to comply
with Rule 3-02 of Regulation S-X, this Amendment No. 1 to the Annual Report on
Form 10-K for the ended December 31, 2001 is being filed to include such
financial statements in Item 8 of this Report and to reference such financial
data in Item 6 and Item 7 of this Report. For the convenience of the reader,
this Amendment No. 1 includes the full text of all Items (including those not
amended).

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                          THE MAJESTIC STAR CASINO, LLC
                        2001 ANNUAL REPORT ON FORM 10-K/A

                                TABLE OF CONTENTS

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                                                 PART I

<S>                                                                                             <C>
Item 1.      Business .......................................................................     1

Item 2.      Properties .....................................................................    11

Item 3.      Legal Proceedings ..............................................................    12

Item 4.      Submission of Matters to a Vote of Security Holders ............................    13

                                                 PART II

Item 5.      Market for Registrant's Common Equity and Related Stockholder Matters ..........    13

Item 6.      Selected Financial Data ........................................................    13

Item 7.      Management's Discussion and Analysis of Financial Condition and
             Results of Operations ..........................................................    14

Item 7A.     Quantitative and Qualitative Disclosures About Market Risk .....................    29

Item 8.      Financial Statements and Supplementary Data ....................................    30

Item 9.      Changes in and Disagreements with Accountants on Accounting and
             Financial Disclosure ...........................................................    30

                                                 PART III

Item 10      Directors and Executive Officers of Registrant .................................    30

Item 11.     Executive Compensation .........................................................    31

Item 12.     Security Ownership of Certain Beneficial Owners and Management
             and Related Stockholder Matters ................................................    32

Item 13.     Certain Relationships and Related Transactions .................................    32

                                                 PART IV

Item 14.     Exhibits, Financial Statement Schedules, and Reports on Form 8-K ...............    33
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                                     PART I

ITEM 1.  BUSINESS

GENERAL

     The Majestic Star Casino, LLC (the "Company" or the "Registrant," which may
also be referred to as "Majestic Star," "we," "us" or "our") was formed in
December 1993 as an Indiana limited liability company. The Company is a
multi-jurisdictional gaming company that owns and operates one riverboat gaming
facility located in Gary, Indiana and, through certain "unrestricted
subsidiaries," three Fitzgeralds-brand casino-hotels located in Tunica County,
Mississippi ("Fitzgeralds Tunica"), Black Hawk, Colorado ("Fitzgeralds Black
Hawk") and downtown Las Vegas, Nevada ("Fitzgeralds Las Vegas"). As of April 1,
2002, the riverboat casino and the Fitzgeralds properties collectively contain
approximately 4,348 slot machines, 115 table games and 1,145 hotel rooms.

     In June 1999, the Company issued $130.0 million of 10 7/8% Senior Secured
Notes due 2006 (the "Majestic Star Senior Secured Notes"). The Majestic Star
Casino Capital Corp. ("Majestic Star Capital"), one of the Company's two direct
wholly-owned subsidiaries, was formed solely to serve as a co-issuer to
facilitate the offering of the Majestic Star Senior Secured Notes and has no
assets or operations. In August 1999, the Company entered into a $20.0 million
credit facility (the "Majestic Star Credit Facility"). The Majestic Star Senior
Secured Notes and the Majestic Star Credit Facility are secured by substantially
all current and future assets of the Company other than certain excluded assets
which excluded assets include the assets of the Company's unrestricted
subsidiaries.

     The Company's other direct wholly-owned subsidiary, Majestic Investor, LLC
("Investor"), was organized on September 12, 2000 as an "unrestricted
subsidiary" under the Company's Indenture relating to the Majestic Star Senior
Secured Notes (the "Majestic Star Indenture"). On November 22, 2000, Investor
entered into a definitive agreement to purchase Fitzgeralds Tunica, Fitzgeralds
Black Hawk and Fitzgeralds Las Vegas from Fitzgeralds Gaming Corporation
("Fitzgeralds") for approximately $149.0 million in cash, subject to
adjustments, plus the assumption of certain liabilities. On October 16, 2001,
Investor assigned all of its rights and obligations to purchase the Fitzgeralds
assets to Majestic Investor Holdings, LLC ("Investor Holdings"), a wholly-owned
subsidiary of Investor and also an "unrestricted subsidiary" under the Majestic
Star Indenture. The acquisition was consummated on December 6, 2001. The assets
of Fitzgeralds Tunica, Fitzgeralds Black Hawk and Fitzgeralds Las Vegas are held
by Barden Mississippi Gaming, LLC ("Barden Mississippi"), Barden Colorado
Gaming, LLC ("Barden Colorado"), and Barden Nevada Gaming, LLC ("Barden
Nevada"), respectively. Each of such entities are direct wholly-owned
subsidiaries of Investor Holdings and "unrestricted subsidiaries" under the
Majestic Star Indenture.

     On December 6, 2001, Investor Holdings issued $152.6 million 11.653% Senior
Secured Notes due 2007 (the "Investor Holdings Senior Secured Notes") to finance
the purchase of the Fitzgeralds assets. Majestic Investor Capital Corp.,
co-issuer of the Investor Holdings Senior Secured Notes and a wholly-owned
subsidiary of Investor Holdings, was formed specifically to facilitate the
offering of such notes and has no material assets or operations. Also on
December 6, 2001, Investor Holdings entered into a $15.0 million credit facility
(the "Investor Holdings Credit Facility").

     The Investor Holdings Senior Secured Notes and the Investor Holdings Credit
Facility are secured by substantially all current and future assets of Investor
Holdings (including the Fitzgeralds assets) other than certain excluded assets.
Because each of Investor, Investor Holdings, Barden Mississippi, Barden Colorado
and Barden Nevada is an "unrestricted subsidiary" under the Majestic Star
Indenture, their assets, including Fitzgeralds Tunica, Fitzgeralds Black Hawk
and Fitzgeralds Las Vegas, are excluded from the collateral securing the
Majestic Star Senior Secured Notes and the Majestic Star Credit Facility.
Accordingly, the Majestic Star Senior Secured Notes and the Majestic Star Credit
Facility are secured

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primarily by the assets of the riverboat casino and gaming facility in Gary,
Indiana and Majestic Star's noteholders and lender have no recourse to the
Fitzgeralds assets. Similarly, the Investor Holdings Senior Secured Notes and
the Investor Holdings Credit Facility are secured primarily by the Fitzgeralds
assets and Investor Holdings' noteholders and lender have no recourse to the
Majestic Star assets. Majestic Star does not guarantee or otherwise have any
obligations under the Investor Holdings Senior Secured Notes or the Investor
Holdings Credit Facility. In addition, Investor Holdings and its subsidiaries
are prohibited from making distributions to the Company and its subsidiaries
except under certain prescribed conditions. The Company and certain of its
subsidiaries also are prohibited from engaging in transactions with Investor
Holdings and its subsidiaries other than on an arm's length basis and in
accordance with certain other prescribed conditions.

     Because the Company's noteholders and lender have no recourse to the
Fitzgeralds assets, this Annual Report on Form 10-K focuses primarily on the
Company's consolidated operations and on the Company's riverboat gaming
operation, with limited information concerning the Fitzgeralds operations. For
additional information specific to the operation of the Fitzgeralds properties,
please refer to the Majestic Investor Holdings, LLC Annual Report on Form 10-K
from inception (September 14, 2001) through December 31, 2001, as filed with the
Securities and Exchange Commission (the "Investor Holdings 10-K").

THE RIVERBOAT CASINO AND GAMING FACILITY

     The Company's riverboat casino and gaming facility, the Majestic Star
Casino, commenced operations in Gary, Indiana on June 7, 1996 pursuant to a
five-year riverboat owner's license granted to it by the Indiana Gaming
Commission (the "IGC"). On August 23, 2001, the Company's riverboat ownership
license was unanimously renewed by the IGC for a one-year period beginning June
7, 2001 (as under Indiana gaming laws, a licensee may only renew its original
license for one-year periods). As of April 1, 2002, the Company's vessel
contains approximately 43,000 square feet of casino space, 1,445 slot machines
and 52 table games on three decks. The Majestic Star Casino is part of a gaming
complex (the "Buffington Harbor Gaming Complex") developed at Buffington Harbor
in Gary, Indiana, and owned by Buffington Harbor Riverboats, L.L.C. ("BHR" or
the "BHR Joint Venture"), a joint venture which is owned equally (50%) by the
Company and Trump Indiana, Inc. (the "Joint Venture Partner"). The Company and
the Joint Venture Partner, the holder of a second gaming license to operate from
Gary, formed the BHR Joint Venture to own and operate certain common facilities
of the Buffington Harbor Gaming Complex such as a guest pavilion, vessel berths,
parking lots and other infrastructure. The Company and the Joint Venture Partner
each operate its own riverboat casino at the Buffington Harbor Gaming Complex on
a staggered cruise schedule, which reduces waiting times to board a riverboat
casino.

     The executive offices of the Company are located at One Buffington Harbor
Drive, Gary, Indiana 46406-3000, and the Company's telephone number is (219)
977-7823.

OPERATING STRATEGY

     The principle elements of our operating strategy include:

     Focus on Quality and Service at an Affordable Price. The Company's casinos
provide a high-quality casino entertainment experience at an affordable price to
attract middle income guests. We believe these middle income guests constitute
the largest segment of potential gaming customers who we can then identify,
qualify and target for direct marketing activities. The Company's approach to
business focuses on guest service and includes trained hosts to personally
assist guests; friendly employees; quality food, beverages and lodging at a
moderate price (except for the Gary riverboat casino and Fitzgeralds Black Hawk,
which do not include hotels); a mix of gaming machines tailored to its
customers; and personal attention through direct mail promotions and targeted
incentives.

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     Management recognizes that consistent quality and a comfortable atmosphere
stem from the collective care and friendliness of each team member. Toward this
end, management takes a hands-on approach through active and direct involvement
with team members at all levels.

     The Company believes that such an approach to business creates a
comfortable, familiar and friendly environment that promotes customer loyalty
and satisfaction, enhances playing time, leads to a high rate of repeat business
and is the basis for the further development of the Company's gaming brands and
its reputation for quality and service at an affordable price.

     Promote Gaming Brands. The Company believes it is important to promote its
gaming brands to attract and retain customers. In February 2000, the Company
began a comprehensive integrated marketing campaign to brand the Majestic Star
Casino as "the place to play" for slot customers from the middle income segment.
The Company's registered tagline, "We've Got Your Slots"(R) has appeared in all
advertising venues including television, radio, print and outdoor media and will
allow the Company to enhance its slot leadership positioning among Chicago-area
gaming facilities. The Company intends to utilize this broad marketing technique
to attract middle income customers, who it is then able to qualify and target
for direct marketing activities.

     The Fitzgeralds brand developed into what the Company believes to be a
nationally recognized gaming brand by using a consistent Irish Luck theme
throughout the casinos, hotels, restaurants and bars at all of its properties.
The Irish Luck theme incorporates various aspects of Irish folklore, such as
leprechauns, horseshoes, four-leaf clovers, the Blarney Stone and a pot of gold
at the end of a rainbow, as well as Irish music. The Company believes that this
theme creates an exciting and comfortable environment together with a
distinctive brand identity for customers.

     Capitalize on Player Tracking and Extensive Guest Database. Direct
marketing to our guests is a key component of the Company's operating strategy.
Each of the Company's properties contains a player tracking system that permits
detailed player tracking at each individual property. The system uses the
Majestic and Fitzgeralds Cards to track individual or combined play at slot
machines, table games and keno, as well as food and beverage and hotel
expenditures at each individual property. This player tracking system allows us
to identify players and their gaming preferences and practices and to develop a
comprehensive customer database for marketing and guest services purposes. Our
player tracking program allows us to target our marketing programs to categories
of players, including through advertising programs, promotions, tournaments with
substantial cash prizes, special group and tour packages and other events and
incentives designed to promote customer loyalty and increase repeat business.
Our tracking system also allows us to better tailor our pricing, promotions,
gaming machine selection and other guest services to customer preferences. In
the future, we intend to fully integrate our tracking system data in order for
each property to share its data with other related properties and thereby
encourage customers of each individual property to patronize our other related
properties. On a consolidated basis, the Company currently has over 670,000
active players in its Majestic and Fitzgeralds database and over 118,000 active
players in its Majestic database.

     In addition, the Company has established the Club Majestic and Club
Majestic Premier Slot Clubs ("Club Majestic"). Club Majestic enables the Company
to maintain a comprehensive database of information about its customers. The
Company also has an established strategy for recruiting and retaining higher
activity casino customers through the reward of certain promotional allowances,
such as direct mail cash back offers for slot customers, and complimentary food,
beverage and entertainment when gaming play warrants. Promotional allowances are
a relatively small percentage of the potential casino revenue obtainable from
these tracked high limit customers. The Company offers two VIP lounges for Club
Majestic guests. The Company has aggressively utilized its VIP lounges for
entertaining Club Majestic guests and for special events and promotions.
Majestic Star Casino management believes that its continued marketing efforts at
its riverboat gaming facility, combined with the amenities offered by its

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vessel and the extension of credit to customers, will allow the Company to
continue to increase its share of the middle and higher income market in the
greater Chicago metropolitan area.

     Emphasis on Slot Play. The Company emphasizes slot machine wagering, which
it believes is the fastest growing and most profitable segment of the casino
entertainment business. The increasing popularity of slot machines is due, in
part, to the continuing rapid technological development that is resulting in the
replacement of older devices with advanced interactive electronic games and bill
acceptors. These newer games offer greater variety, higher pay outs and longer
periods of play for the casino entertainment dollar relative to simple older
devices. The Company continues to enhance and modify its mix of slot machines to
meet the demand of its customers. The Company attempts to maintain payout
percentages that are competitive to attract and retain customers.

     Emphasis on Attributes of Buffington Harbor. With respect to the Majestic
Star Casino, the Company emphasizes the attributes of the Buffington Harbor
Gaming Complex, including the ability to park once and play twice (at two
casinos) and direct highway access. In June 2000, the Company launched a
marketing campaign with its Joint Venture Partner whereby both entities jointly
advertise the attributes of the Buffington Harbor Gaming Complex principally
through billboards and print. The Buffington Harbor Gaming Complex also has
enhanced and expanded its food outlets. In 2000, three new food kiosks were
introduced including Harbor Treats and Shou Ki Sushi which are owned and
operated by third parties and Jackpot Java which is owned and operated by BHR.
Entertainment is also being provided in the Lakeshore lounge on weekends.
Currently, a 2,000 space covered parking structure is under construction at the
Buffington Harbor Gaming Complex, which is expected to be completed in May 2002.

GROWTH STRATEGY

     The Company believes that there are substantial future growth opportunities
within each of the markets where its properties are located. With respect to the
Majestic Star Casino, the Company's expansion strategy is focused on increasing
the overall size of the Buffington Harbor Gaming Complex. Don H. Barden,
Chairman and CEO of the Company, through an affiliated company, Gary New
Century, LLC ("GNC"), purchased for $25.0 million approximately 190 acres
adjacent to Buffington Harbor in September 2000. A portion of this acreage was
subsequently sold by Mr. Barden to a joint venture, Buffington Harbor Parking
Associates, LLC ("BHPA") formed by the Joint Venture Partner and AMB Parking,
LLC ("AMB") (a company wholly-owned indirectly by Mr. Barden) in order to
jointly construct and operate a multi-level covered parking structure. The
parking structure is expected to provide customers with approximately 2,000
covered parking spaces and indoor access to the Buffington Harbor Gaming
Complex. Customers currently either park their automobiles in a remote
self-parking lot or use valet parking services. The parking project is estimated
to cost approximately $37.7 million including approximately $14.2 million for
the land. Approximately $20.9 million of the project costs for the parking
structure was financed with the balance of $16.8 million being funded by lease
payments from the Company and the Joint Venture Partner. The financing was
obtained pursuant to a Construction and Term Loan Agreement, dated June 19,
2001, between BHPA and US Bank, N.A., as agent. Upon completion of the parking
garage, the Company and the Joint Venture Partner each anticipate entering into
a lease with BHPA with lease payments in an amount sufficient to service the
debt on the BHPA financing. Each party will receive a credit of up to 50% of the
lease obligations if the other party (the Company or the Joint Venture Partner,
as the case may be) makes its lease payments. The Company believes that the
convenience of the new parking structure will attract a significant number of
new customers to Buffington Harbor, thereby providing opportunities for the
Company to increase its net revenues and cash flow.

     The Buffington Harbor Gaming Complex is located on an approximately
100-acre site. The Company believes that this is only one of two locations in
the Chicago market with the capacity to significantly expand its land-based
facilities. In addition to the BHR Joint Venture property, GNC, an affiliate of
the Company, has entered into discussions with various parties concerning the
feasibility of developing the land adjacent to the BHR Joint Venture property.

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     There are a number of projects planned or in development with respect to
the Fitzgeralds properties, including a waterfront park being developed by
Tunica County adjacent to the Fitzgeralds Tunica property, infrastructure
developments in the Black Hawk market, and entertainment and retail projects in
Las Vegas. For further information regarding the Company's growth strategy for
each of the Fitzgeralds properties, please refer to the Investor Holdings 10-K.

     We regularly evaluate possible expansion and acquisition opportunities. We
may undertake these opportunities either alone or with joint venture partners.
The Company's ability to expand will depend upon a number of factors including,
but not limited to: (i) the identification and availability of suitable
locations, and the negotiation of acceptable purchase, lease, joint venture or
other terms; (ii) securing required state and local licenses, permits and
approvals, which in some jurisdictions may be limited in number, (iii) political
factors; (iv) the risks typically associated with any new construction; and (v)
the availability of adequate financing or acceptable terms, particularly in
light of restrictive covenants contained in the instruments relating to the
Majestic Star Senior Secured Notes and the Majestic Star Credit Facility (and
the Investor Holdings Senior Secured Notes and Investor Holdings Credit Facility
with respect to Investor Holdings), which limit the Company's and Investor
Holdings', as the case may be, ability to obtain such financing. As a result,
there can be no assurance that the Company will be able to expand either its
current properties or to add any other additional locations or, if such
expansion occurs, that it will be successful.

COMPETITION

     The Company faces intense competition in each of the markets in which its
gaming facilities are located. Many of the Company's competitors have
significantly greater name recognition and financial, marketing and other
resources. The Company's riverboat casino and Fitzgeralds properties compete
principally with other gaming properties in or near California, Illinois,
Indiana, Nevada, Michigan, Mississippi and Colorado, including gaming operations
on Native American lands. In addition to regional competitors, the Company
competes with gaming facilities nationwide, including land-based casinos in
Nevada and Atlantic City, not only for customers but also for employees and
potential future gaming sites.

     The Company also competes, to some extent, with other forms of gaming on
both a local and national level, including state-sponsored lotteries, Internet
gaming, on- and off-track wagering and card parlors. The expansion of legalized
gaming to new jurisdictions throughout the United States has increased
competition faced by the Company and will continue to do so in the future.
Additionally, if gaming were legalized in jurisdictions near the Company's
properties where gaming currently is not permitted, the Company would face
additional competition. There can be no assurance that the Company will be able
to continue to compete successfully in its existing markets or that the Company
will be able to compete successfully against any such future competition.

     The Majestic Star Casino is dependent primarily on adults residing within
150 miles of the Buffington Harbor Gaming Complex, which includes the Chicago
metropolitan area. Illinois and Indiana state laws limit the total number of
gaming licenses issuable in the Chicago metropolitan area to ten. Nine of the
licenses are currently in operation and the number of licenses cannot be
increased without legislative action. The Company also expects to compete to a
lesser extent with six additional riverboats authorized to operate in southern
Indiana, of which five are currently operational. There can be no assurance that
Indiana or Illinois will not authorize additional gaming licenses in the future.
The authorization of additional gaming licenses could have a material adverse
effect on the Company.

     Dockside gaming was approved in Illinois in June 1999. Since such approval,
the Illinois gaming market grew by approximately 8.1% and the northwest Indiana
gaming market grew by approximately 7.3%. Notwithstanding the market growth,
management is unable to predict whether increased competition in the market from
dockside gaming will have a negative impact on the Company's revenues.

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At present, Harrahs is operating a barge-based casino in Illinois and Hollywood
is in the process of constructing its own barge-based casino.

     Legislation has also been introduced in Illinois to provide for land-based
casinos in Chicago and to expand riverboat gaming, including authorization of
additional or existing operators to move to new sites. In 2002, legislation was
introduced in Indiana to provide for dockside gaming and to allow riverboat
gambling companies to own two of the state's ten gaming licenses. To date, no
such legislation has been enacted. The Company is unable to predict whether any
such legislation, in Illinois, Indiana or elsewhere, will be enacted or whether,
if passed, it would have a material adverse impact on the results of operations
or financial condition of the Company.

     The Majestic Star Casino also competes with gaming operations on Native
American lands, including those located, or to be located, in Michigan,
Wisconsin and possibly northern Indiana. The Saginaw Chippewa Indian Tribe is
currently operating one of the largest Native American gaming complexes in the
United States in Mt. Pleasant, Michigan, approximately 250 miles northeast of
Gary, Indiana. The Pokagon Band of Potawatomi Indians have revenue-sharing and
infrastructure financing agreements with local officials in New Buffalo
Township, Michigan. These agreements advance the Band's goal of opening a
land-based gaming facility by December 2002. The Pokagons plan to have the
second largest casino in the Midwest, which would be substantially larger in
size than any of the riverboats currently operating in the Chicago metropolitan
area. The casino would be approximately 50 miles east of the Buffington Harbor
Gaming Complex.

     The Company believes that the Majestic Star Casino's ability to compete
successfully in the riverboat gaming industry will be primarily based on the
quality and location of its gaming facilities, the effectiveness of its
marketing efforts, and overall levels of customer service and satisfaction. The
Company believes that the construction of the parking facility will provide
added competitive benefits to the Buffington Harbor Gaming Complex.

     For information regarding competition specific to the Fitzgeralds
properties, please refer to the Investor Holdings 10-K.

FINANCIAL INFORMATION ABOUT SEGMENTS

     For financial information regarding the Company's business segments, see
Note 15 of the Notes to Consolidated Financial Statements.

EMPLOYEES AND UNIONS

     At December 31, 2001, on a consolidated basis, the Company employed
approximately 3,482 persons and had collective bargaining contracts with unions
covering approximately 488 of its employees. The Company believes that its
overall relations with its employees are good.

     At December 31, 2001, the Majestic Star Casino employed approximately 965
persons and the BHR Joint Venture employed approximately 366 persons. The
Majestic Star Casino and the BHR Joint Venture have collective bargaining
agreements with Local 1 of the Hotel Employees and Restaurant Employees
International Union ("H.E.R.E."), covering approximately 66 employees of the
Majestic Star Casino and approximately 173 employees of the BHR Joint Venture.
The Majestic Star Casino's H.E.R.E. members are exclusively in food and beverage
positions. The agreements expired on June 30, 2001 and are currently being
renegotiated. The BHR Joint Venture also has collective bargaining agreements
with the Operating Engineers Union, covering approximately 14 employees of its
facilities department. The agreement with the BHR Joint Venture expired on July
1, 2001 and a new agreement has been ratified and is in the process of being
signed. The Majestic Star Casino also has a collective bargaining agreement with
the Seafarers International Union that covers approximately 29 employees in the
marine operations department. The agreement expires on July 10, 2003.

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     In recruiting personnel, the Company is obligated, under the terms of an
agreement with the City of Gary, to use its best efforts to have an employee
base which is comprised of 70% from racially minority groups, 52% females, 67%
residents of the City of Gary and 90% residents of Lake County, Indiana.

     For information regarding employees specific to the Fitzgeralds properties,
please refer to the Investor Holdings 10-K.

TRADE NAMES, TRADEMARKS AND SERVICES MARKS

     The Company owns certain trademarks which are integral to the business and
operation of its riverboat gaming facility. The most significant of these are
Majestic Star Casino (words and design), Majestic Star, Club Majestic, Club
Majestic Premier, Change Your Luck! and We've Got Your Slots. Majestic Star
Casino (words and design), Majestic Star and Club Majestic are currently
registered in the United States Patent and Trademark Office ("PTO") and
applications for registrations of the other above referenced trademarks have
been filed in the PTO. Generally, registrations with the PTO last for ten years
and may be renewed for additional ten-year periods.

     With respect to the Fitzgeralds properties, as part of the Fitzgeralds
acquisition, Investor Holdings acquired proprietary rights in registered and
common law trade names, trademarks and service marks used in connection with the
business, including the "Fitzgeralds" mark. Fitzgeralds retained limited rights
to use the "Fitzgeralds" mark.

SEASONALITY

     The gaming operations of the Company's properties may be seasonal and,
depending on the location and other circumstances, the effects of such
seasonality could be significant. The properties' results are affected by
inclement weather in relevant markets. For example, because of the climate in
the Chicago metropolitan area, the Majestic Star Casino's operations are
expected to be seasonal with stronger results generally expected during the
period from May through September. Fitzgeralds Black Hawk, located in the Rocky
Mountains of Colorado, is subject to snow and icy road conditions during the
winter months. Also, at Fitzgeralds Las Vegas, business levels are generally
weaker from Thanksgiving through the middle of January (except during the week
between Christmas and New Year's) and throughout the summer, and generally
stronger from mid-January through Easter and from mid-September through
Thanksgiving. At Fitzgeralds Tunica and Fitzgeralds Black Hawk, business levels
are typically weaker from Thanksgiving through the end of the winter and
typically stronger from mid-June to mid-November. Accordingly, the Company's
results of operations are expected to fluctuate from quarter to quarter and the
results for any fiscal quarter may not be indicative of results for future
fiscal quarters.

ENVIRONMENTAL MATTERS

     The Company is subject to certain federal, state and local environmental,
safety and health laws, regulations and ordinances, including the Clear Air Act,
Clean Water Act, Occupational Safety and Health Act, Oil Pollution Act, Resource
Conservation Recovery Act and the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"). The Company may
incur material liability if contamination is discovered on any of its
properties.

     For information regarding environmental matters specific to the Fitzgeralds
properties, please refer to the Investor Holdings 10-K.

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GOVERNMENTAL REGULATION

     The ownership and operation of the Company's gaming facilities are subject
to various state and local laws and regulations in the jurisdictions where they
are located. The following is a summary of the provisions of the Indiana laws
and regulations applicable to the Company's riverboat gaming facility and other
laws and regulations applicable to the Company as a registered holding company
in Nevada and Mississippi. For information regarding governmental regulations
specific to the Fitzgeralds gaming facilities, please refer to the Investor
Holdings 10-K. The summary does not purport to be a full description thereof and
is qualified in its entirety by reference to such laws and regulations.

Indiana Gaming Regulation

     The ownership and operation of the Majestic Star Casino is subject to
regulation by the State of Indiana.

     In 1993, the State of Indiana passed the Riverboat Gambling Act that
created the Indiana Gaming Commission (the "IGC"). The IGC is given extensive
powers and duties for the purposes of administering, regulating and enforcing
riverboat gaming in Indiana and was authorized to award up to eleven gaming
licenses to operate riverboat casinos in the State of Indiana, including five to
counties contiguous to Lake Michigan in northern Indiana, five to counties
contiguous to the Ohio River in southern Indiana and one to a county contiguous
to Patoka Lake in southern Indiana.

     Referenda required by the Riverboat Gambling Act to authorize the five
licenses to be issued for counties contiguous to Lake Michigan have been
conducted and gaming has been authorized for the cities of Hammond, East
Chicago, and Gary in Lake County, Indiana, and for Michigan City in LaPorte
County, Indiana to the east of Lake County.

     The IGC has jurisdiction and supervision over all riverboat gaming
operations in Indiana and all persons on riverboats where gaming operations are
conducted. These powers and duties include authority to (i) investigate all
applicants for riverboat gaming licenses, (ii) select licensees from competing
applicants, (iii) establish fees for licensees and (iv) prescribe all forms used
by applicants. The IGC is authorized to adopt rules for administering the gaming
statute and the conditions under which riverboat gaming in Indiana may be
conducted. The IGC may suspend or revoke the license of a licensee or impose
civil penalties, in some cases without notice or hearing, for any act in
violation of the Riverboat Gambling Act or for any other fraudulent act.

     The Riverboat Gambling Act requires an extensive disclosure of records and
other information concerning an applicant, including disclosure of all
directors, officers and persons holding a five percent or more direct or
indirect beneficial interest in an applicant.

     In determining whether to grant or renew an owner's license to an
applicant, the IGC considers a number of factors, including (i) the character,
reputation, experience and financial integrity of the applicant, (ii) the
facilities or proposed facilities for the conduct of riverboat gaming, (iii) the
prospective revenue to be collected by the state from the conduct of riverboat
gaming, (iv) the good faith affirmative action plan to recruit, train and
upgrade minorities in all employment classifications, (v) the financial ability
of the applicant to purchase and maintain adequate liability and casualty
insurance, (vi) whether the applicant has adequate capitalization to provide and
maintain the riverboat for the duration of the license and (vii) the extent to
which the applicant meets or exceeds other standards adopted by the IGC. The IGC
may also give favorable consideration to applicants for economically depressed
areas and applicants who provide for significant development of a large
geographic area. A person or entity holding a riverboat owner's license issued
by the IGC may not own more than a ten percent interest in another such
licensee. Legislation has been introduced during both the 2001 and 2002 Indiana
legislative sessions that would allow a person or entity to own not more than
two casinos. To date no such legislation has been enacted.

                                        8

<PAGE>

An owner's license expires five years after the effective date of the license
(unless earlier terminated or revoked) and may be renewed for one year periods
by the IGC upon satisfaction of certain statutory and regulatory requirements. A
gaming license is a revocable privilege and is not a property right pursuant to
the Riverboat Gambling Act. On June 3, 1996, the Majestic Star Casino obtained a
gaming license from the IGC. On August 23, 2001, the Company's riverboat
ownership license was unanimously renewed by the IGC for a one year period
beginning June 7, 2001.

     Under IGC regulations, minimum and maximum wagers on games are left to the
discretion of the licensee. Wagering is required to be conducted with tokens,
chips or electronic cards instead of cash or coins. Each riverboat gaming
excursion is limited to a maximum duration of four hours unless a longer
excursion is expressly approved by the IGC. In January 2001, a bill providing
for dockside gaming as well as increased gross wagering taxes was passed by the
Indiana House of Representatives, one of the two legislative bodies of the
Indiana General Assembly. A similar bill providing for dockside gaming was
defeated by the Senate Rules Committee on March 28, 2001. In the 2002 regular
session of the Indiana General Assembly, legislation was introduced to, among
other things, authorize dockside gaming, authorize pari-mutuel pull tab gaming
at two Indiana horse racing facilities and certain off track betting facilities,
authorize a riverboat to be located in French Lick and West Baden, Indiana, make
certain changes to the admission taxes and wagering taxes collected by the State
of Indiana, allow a person or entity to own up to a 100% interest in not more
than two riverboats and make various other changes in the Riverboat Gambling
Act. Differing versions of this legislation passed each of the Indiana House of
Representatives and the Indiana Senate and the legislation was assigned to a
conference committee. The conference committee was unable to reconcile the
differences between the House and Senate versions of the legislation, and the
2002 regular session of the Indiana General Assembly adjourned on March 14,
2002, without enacting this legislation. To date no such legislation has been
enacted.

     Effective November 1996, riverboat casinos operating on Lake Michigan were
granted an exemption to the Johnson Act, a federal statute which prohibits
casino gambling on federal waterways. Prior to November 1996 the riverboat
casinos operating on Lake Michigan, including the Majestic Star Casino, remained
dockside and simulated cruising. No gaming may be conducted while the boat is
docked except (i) for 30-minute time periods at the beginning and end of a
cruise while the passengers are embarking and disembarking, (ii) if the master
of the riverboat reasonably determines that specific weather or water conditions
present a danger to the riverboat, its passengers or crew, or other vessels on
the water, (iii) if either the vessel or the docking facility is undergoing
mechanical or structural repair, (iv) if water traffic conditions present a
danger to the riverboat, its passengers or crew, or other vessels on the water,
or (v) if the master has been notified that a condition exists that would cause
a violation of federal law if the riverboat were to cruise.

     An Indiana admission tax of $3.00 for each person admitted to each gaming
excursion is imposed upon the license owner. Legislation has been introduced in
the past that would increase the admission tax to $5.00 per person, and that
would alter the way in which admission taxes are calculated, but to date, no
such legislation has been enacted. The Company is unable to predict if this
legislation will be reintroduced or if any other legislation introduced in
Indiana related to riverboat gaming will be enacted. If legislation is enacted
to increase the admission tax, the effect of such an increase could have a
material impact on the results of operations of the Company. A 20% tax is
imposed on the "adjusted gross receipts" received from gaming operations, which
is defined under the Riverboat Gambling Act as the total of all cash and
property received (including checks received by the licensee whether or not
collected), less the total of all cash paid out as winnings to patrons and
uncollected gaming receivables (not to exceed 2%). Legislation has been
introduced as recently as the 2002 Indiana General Assembly session that would
increase the tax and allow the riverboats to operate dockside and/or barge
facilities, but to date, no such legislation has been enacted. The riverboat
owner licensee must remit the admission and wagering taxes before the close of
business on the day following the day on which the taxes were incurred. Indiana
laws also permit the imposition of real property taxes on Indiana riverboats at
rates to be determined by local taxing authorities of the jurisdiction in which
a riverboat operates.

                                        9

<PAGE>

     The IGC is authorized to license suppliers and certain occupations related
to riverboat gaming. Gaming equipment and supplies customarily used in
conducting riverboat gaming may be purchased or leased only from licensed
suppliers.

     The Riverboat Gambling Act places special emphasis upon minority and women
business enterprise participation in the riverboat industry. The IGC is directed
by Indiana statute to establish annual goals for a riverboat owner licensee for
the use of minority and women business enterprises. Each riverboat owner
licensee is required to submit annually to the IGC a report that included the
total dollar value of contracts awarded for goods and services and the
percentage awarded to minority and women's business enterprises. The IGC may
suspend, limit or revoke an owner's gaming license or impose a fine for failure
to comply with these statutory requirements. For the calendar year ended
December 31, 2001, the Company has submitted unaudited reports to the IGC that
it believes meets these statutory requirements.

     In addition, the Company and its affiliates are subject to restrictions on
the incurrence of debt. A riverboat licensee and its affiliates may enter into
debt transactions that total one million dollars or more only with the prior
approval of the Indiana Gaming Commission. Such approval is subject to
compliance with request procedures and a showing that each person with whom the
riverboat licensee and its affiliates enters into a debt transaction would be
suitable for licensure under the Indiana Riverboat Gambling Act. The Company and
Investor Holdings received such approval in mid-November 2001 in connection with
the purchase of the Fitzgeralds assets and the issuance of the Investor Holdings
Senior Secured Notes and a $15 million credit facility with Foothill Capital
Corporation ("Investor Holdings Credit Facility").

Other Gaming Regulation

     The gaming licenses of the Fitzgerald Tunica and Fitzgerald Las Vegas
gaming facilities are held by Barden Mississippi and Barden Las Vegas,
respectively. Under the applicable gaming laws and regulations in Mississippi
and Nevada, each direct and indirect owner of such licenses is required to be
registered with the applicable gaming authorities and found suitable to own the
stock of its direct subsidiary. Accordingly, Barden Development, Inc., an
Indiana corporation and the sole owner and manager of the Company ("BDI"); the
Company, the owner of Investor; and Investor Holdings, the owner of each of
Barden Mississippi and Barden Nevada are "registered corporations" under and
subject to applicable Mississippi and Nevada law. Violation of applicable laws
and regulations by a registered corporation could subject such entity to
substantial fines and, under certain circumstances, forfeiture of earnings and
suspension or forfeiture of the gaming license.

Treasury Department Regulations

     The Internal Revenue Code and Treasury Regulations require operators of
casinos located in the United States to file information returns for U.S.
citizens, including names and addresses of winners, for keno and slot machine
winnings in excess of prescribed amounts. The Internal Revenue Code and Treasury
Regulations also require operators to withhold taxes on some keno, bingo, and
slot machine winnings of nonresident aliens. We are unable to predict the extent
to which these requirements, if extended, might impede or otherwise adversely
affect operations of, and/or income from, the other games.

     Regulations adopted by the Financial Crimes Enforcement Network of the
Treasury Department and the gaming regulatory authorities in some of the
domestic jurisdictions in which we operate casinos, require the reporting of
currency transactions in excess of $10,000 occurring within a gaming day,
including identification of the patron by name and social security number. This
reporting obligation began in May 1985 and may have resulted in the loss of
gaming revenues to jurisdictions outside the United States which are exempt from
the ambit of these regulations.

                                       10

<PAGE>

Compliance with Other Laws and Regulations

     The Company's operations are also subject to extensive state and local
regulations in addition to the regulations described above, and, on a periodic
basis, we must obtain various other licenses and permits, including those
required to sell alcoholic beverages.

ITEM 2.  PROPERTIES

     The Company currently owns and operates the Majestic Star Casino in Gary,
Indiana, and through its indirect subsidiaries, Fitzgeralds Tunica in Tunica
County, Mississippi, Fitzgeralds Black Hawk in Black Hawk, Colorado, and
Fitzgeralds Las Vegas in Las Vegas, Nevada.

Buffington Harbor, Gary, Indiana

     The Majestic Star Casino operates from the Buffington Harbor Gaming
Complex, which is shared with the Joint Venture Partner. Buffington Harbor is
located at the interchange of U.S. 12 and Indiana State Highway 912, just off of
I-80/94 and the Indiana Toll Road. The Buffington Harbor Gaming Complex is a
two-level, 90,000 square foot structure containing a 352-seat buffet, a 110-seat
steakhouse restaurant, several bars and lounges, gift shops and areas for
staging and ticketing. The complex features a grand entrance, granite and marble
floors, unique metallic finishes, two large fountains and a variety of lighting
effects.

     The Buffington Harbor Gaming Complex is situated on an approximately
100-acre site, containing approximately 3,000 parking spaces, and offers valet
parking and convenient bus loading and unloading facilities. The Buffington
Harbor Gaming Complex includes a guest pavilion, vessel berths, parking lots and
other common area facilities. The Buffington Harbor Gaming Complex has three
food kiosks; Harbor Treats and Shou Ki Sushi, which are owned and operated by
third parties, and Jackpot Java, which is owned and operated by BHR.
Entertainment is also being provided in the Lakeshore lounge on weekends.
Buffington Harbor has the largest concentration of gaming positions in the
Chicago Market, offering patrons a total of approximately 3,500 gaming
positions, which is greater than the number of gaming positions that exist at
any other site in northwest Indiana. This number is also substantially greater
than the number of gaming positions allowed at any individual Illinois gaming
site, which is currently limited by Illinois gaming laws to 1,200. The Company
believes that it has achieved operating cost savings and marketing advantages
over its competitors as a result of the operation of two casinos at the same
location.

     Buffington Harbor offers two cruising vessel casinos (one owned by the
Company and the other owned by the Joint Venture Partner) with a staggered
cruising schedule. As a result, patrons enjoy significantly reduced waiting
times to board a casino. Specifically, the maximum scheduled waiting time for
Buffington Harbor patrons is 30 minutes, compared to a maximum of 90 minutes in
all other northwest Indiana gaming locations. Further, gaming customers in the
Chicago area, Indianapolis, South Bend and Fort Wayne, Indiana, and Kalamazoo
and Grand Rapids, Michigan can conveniently access Buffington Harbor.

     BHPA is constructing a parking garage which it intends to operate on the
land formerly leased from Lehigh Portland Cement Company and purchased from GNC.
The parking structure is expected to provide customers with approximately 2,000
covered parking spaces and indoor access to the Buffington Harbor Gaming
Complex. Customers currently either park their automobiles in a remote self
parking lot or use valet parking services. The Company believes that the
convenience of the new parking structure will attract a significant number of
new customers to Buffington Harbor, thereby providing opportunities to increase
its net revenues and cash flow. Upon completion of the parking garage, the
Company and the Joint Venture Partner each anticipate entering into identical
leases with BHPA with lease payments sufficient to service BHPA's debt. Each
party will receive a credit of up to 50% of the lease obligations if the other
party (the Company or the Joint Venture Partner, as the case may be) makes lease
payments. The Company expects the parking garage to open in May 2002.

                                       11

<PAGE>

     All of the Company's assets related to the Majestic Star Casino, including
the vessel are subject to a lien in favor of the holders of the Majestic Star
Senior Secured Notes and the lender under the Majestic Star Credit Facility.

Fitzgeralds Properties

     Fitzgeralds Tunica is located in north Tunica County, Mississippi,
approximately 30 miles from downtown Memphis, Tennessee, and is the focal point
of a heavily wooded, 50-acre site situated by the Mississippi River. Fitzgeralds
Black Hawk is located adjacent to the entrance to the downtown gaming area of
Black Hawk, Colorado, next to the Gilpin Casino and across the street from
Bullwhackers. Fitzgeralds Las Vegas is located on the city block bounded by
Fremont, Carson, Third and Fourth Streets at the Fremont Street Experience in
downtown Las Vegas. All of the Company's assets related to the Fitzgerald
properties are subject to a lien in favor of the holders of the Investor
Holdings Senior Secured Notes and the lender under the Investor Holdings Credit
Facility.

     For further information regarding the Fitzgeralds properties, please refer
to the Investor Holdings 10-K.

ITEM 3.  LEGAL PROCEEDINGS

     Various legal proceedings are pending against the Company. Management
considers all such pending proceedings, comprised primarily of personal injury
and equal employment opportunity (EEO) claims, to be routine litigation
incidental to the Company's business. Management believes that the resolution of
these proceedings will not, individually or in the aggregate, have a material
effect on the Company's financial condition or results of operations.

     On June 25, 1997, a complaint was filed in an Illinois Cook County Court
against Majestic Star Casino. The plaintiff, a former employee, was injured
during and as a result of a routine boat drill attempt and is requesting
compensatory and punitive damages totaling approximately $3.5 million. The suit
alleges that Majestic Star Casino failed to provide adequate safety measures to
their employees during these drills. The parties are in settlement negotiations.
The Company does not believe that the resolution of this suit will have a
material impact on the Company's financial position and results of operation.

     On March 27, 1998, a complaint was filed in the Lake County Superior Court
in East Chicago, Indiana, against BHR, the Joint Venture Partner, and the
Company. The plaintiff, a former employee of the Company, claims to have been
assaulted in the BHR parking lot on June 25, 1997 and is requesting compensatory
and punitive damages totaling approximately $11.0 million. The suit alleges that
the Joint Venture Partner and the Company failed to provide adequate security to
prevent assaults. The Company intends to vigorously defend against such suit.
However, it is too early to determine the outcome of such suit and the effect,
if any, on the Company's financial position and results of operations.

     On March 2, 2000, the Company was issued a notice of audit findings, and on
May 11 and 12, 2000, was issued notices of assessment by the Indiana Department
of Revenue for income tax withholding deficiencies for the years ended 1996 and
1998. The Indiana Department of Revenue has taken the position that wagering
taxes should not be classified as an allowable deductible expense for
calculating state income taxes and therefore requires that wagering taxes be
added back to net income to determine the tax liability. The estimated tax
deficiency for 1996 is approximately $239,000 excluding interest and the
estimated tax deficiency for 1998 is approximately $315,000 excluding interest.
This same finding has been protested by other Indiana casinos. The Company has
filed an administrative protest and demand for hearing with the Indiana
Department of Revenue. However, it is too early to determine the outcome of such
a protest.

                                       12

<PAGE>

     From time to time, the Company may be involved in routine administrative
proceedings involving alleged violations of certain provisions of the Riverboat
Gambling Act. Management believes that the outcome of any such proceedings will
not, either individually or in the aggregate, have a material adverse effect on
the Company or its ability to retain and/or renew any license required under the
Riverboat Gambling Act for the Company's operations. No such proceedings are
pending at this time.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.


                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     The Company is a privately owned Indiana limited liability company and, as
such, there is no public market for the registrant's equity securities.

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                        (DOLLARS IN THOUSANDS)
                                                        Years Ended December 31,
                                            2001 (1)    2000       1999       1998       1997
                                            ----        ----       ----       ----       ----
<S>                                       <C>         <C>       <C>        <C>         <C>
STATEMENT OF OPERATIONS DATA:
           Net Operating Revenues (2)     $129,593    $113,433  $ 117,172  $ 114,188  $ 94,393
           Pre-opening Expenses              1,018          --         --         --     1,254
           Operating Income                 17,024      10,920     18,932     13,685       607
           Interest Expense, Net            15,628      14,105     14,605     14,991    11,046
           Income (Loss)
              Before Extraordinary Item     (1,551)     (5,367)     1,478     (4,473)  (13,887)
           Extraordinary Item                   --        (383)   (15,238)        --        --
           Net Loss                         (1,551)     (5,750)   (13,760)    (4,473)  (13,887)

OTHER DATA
           Adjusted EBITDA:  (3)            27,045      21,223     27,307     23,219    12,701

<CAPTION>
                                                           At December 31,
BALANCE SHEET DATA:                         2001 (1)    2000       1999       1998      1997
                                            ----        ----       ----       ----      ----
<S>                                       <C>         <C>        <C>        <C>       <C>
           Cash and Cash Equivalents      $ 25,925    $ 16,120   $ 20,145   $ 17,295  $  8,084
           Restricted Cash                   1,000       2,000      7,358         --    11,905
           Investment in BHR, Net           33,899      43,924     38,146     40,749    43,542
           Total Assets                    291,060     126,597    133,150    125,261   134,762
           Current Liabilities              37,144      21,795     21,311     11,109    11,699
           Long-Term Debt                  273,897     128,233    128,922    108,390   110,829
           Total Liabilities               311,041     150,028    150,233    128,259   133,286
           Members' Equity/(Deficit)       (19,981)    (23,431)   (17,083)    (2,998)    1,476
</TABLE>


NOTES:
1. Includes 25 days of operations for the Fitzgeralds properties and balance
   sheet data for the properties at December 31, 2001.

2. Net operating revenue is defined as gross revenues less promotional
   allowances.

                                       13

<PAGE>

3   Adjusted EBITDA represents earnings before interest, taxes on income,
    depreciation and amortization, and excludes: (i) $100,000 in costs
    associated with an abandoned acquisition for 1999; (ii) loss on bond
    redemption for 1999 and 2000; (iii) unused line of credit fees for 2000 and
    2001; (iv) non-operating expenses associated with dockside lobbying
    initiatives, economic development and extraordinary items of $772,000 in
    2000; (v) loss on investment in BHR; (vi) pre-opening costs of $1,018,000
    associated with the acquisition of Fitzgeralds; and (vii) losses on
    disposals of assets. Adjusted EBITDA is a supplemental financial measurement
    used by the Company in the evaluation of its gaming business and by many
    gaming industry analysts. Adjusted EBITDA should only be read in conjunction
    with all of the Company's financial data summarized above and its financial
    statements prepared in accordance with generally accepted accounting
    principles ("GAAP") appearing elsewhere herein, and should not be construed
    as an alternative either to income from operations (as determined in
    accordance with GAAP) as an indication of the Company's operating
    performance or to cash flows from operating activities (as determined in
    accordance with GAAP) as a measure of liquidity. The Company believes that
    an analysis of Adjusted EBITDA enhances the understanding of the financial
    performance of companies with substantial depreciation and amortization.

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

Statement on Forward-Looking Information

     This report includes statements that constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
are subject to the safe harbor provisions of those sections and the Private
Securities Litigation Reform Act of 1995. Words such as "believes,"
"anticipates," "estimates" or "expects" used in the Company's press releases and
reports filed with the Securities and Exchange Commission are intended to
identify forward-looking statements. All forward-looking statements involve
risks and uncertainties. Although the Company believes its expectations are
based upon reasonable assumptions within the bounds of its current knowledge of
its business and operations, there can be no assurances that actual results will
not materially differ from expected results. The Company cautions that these and
similar statements included in this report and in previously filed periodic
reports are further qualified by important factors that could cause actual
results to differ materially from those in the forward-looking statements. Such
factors include, without limitation, the following: the construction of a
covered parking facility located at the Company's gaming complex; the risk of
the JV Partner not making its lease payments when due in connection with such
parking facility; the ability to fund planned development needs and to service
debt from existing operations; increased competition in existing markets or the
opening of new gaming jurisdictions; a decline in the public acceptance of
gaming; the limitation, conditioning or suspension of the Company's gaming
license; increases in or new taxes imposed on gaming revenues; admission taxes;
taxes on gaming devices; a finding of unsuitability by regulatory authorities
with respect to the Company or its officers, or key employees; loss and/or
retirement of key executives; our inability to timely and cost effectively
integrate operations of the Fitzgeralds casinos; significant increase in fuel or
transportation prices; adverse economic conditions in the Company's markets;
severe and unusual weather in the Company's markets; non-renewal of the
Company's gaming license from the appropriate regulatory authorities; adverse
results of significant litigation matters; and the continuing effects of recent
terrorist attacks and any future occurrences of terrorist attacks or other
destabilizing events.

     For more information on these and other factors, see "Factors that May
Affect Future Results." We caution readers not to place undue reliance on
forward-looking statements, which speak only as of the date thereof. All
subsequent written and oral forward-looking statements attributable to us are
expressly qualified in their entirety by the cautionary statements and factors
that may affect future results contained throughout this report. The Company
undertakes no obligation to publicly release any revisions to such
forward-looking statements to reflect events or circumstances after the date
hereof.

     The following discussion should be read in conjunction with, and is
qualified in its entirety by, our financial statements, including the notes
thereto listed in Item 14(a).

                                       14

<PAGE>

Overview

     The Majestic Star Casino has been owned and operated by the Company since
1996. In December 2001, the Company, through a series of indirect wholly-owned
subsidiaries acquired Fitzgeralds Tunica, Fitzgeralds Black Hawk and Fitzgeralds
Las Vegas.

     On a consolidated basis, gross revenues increased to $138.4 million in 2001
from $118.5 million in 2000, primarily as a result of the acquisition of the
Fitzgeralds casino properties on December 6, 2001 and a 10.9% increase in slot
revenue at Majestic Star Casino.

     Casino operations provided approximately 95.8% and 97.5% of the Company's
gross revenues during 2001 and 2000, respectively, and substantially all of its
income from operations. Slot machine income has been the primary component of
the Company's gaming revenues, providing approximately 84.5% and 80.6% of such
revenues during 2001 and 2000, respectively.

     The discussion below focuses on the results of the Majestic Star Casino as
well as the Company and its subsidiaries on a consolidated basis, including 25
days of operations for the Fitzgeralds casino properties. For a discussion of
the results of the 25 days of operations of the Fitzgeralds casino properties,
and the results of operations of the Fitzgeralds casino properties on a
historical basis, please refer to the Investor Holdings 10-K.

Results of Operations

     The following table sets forth information derived from the Company's
statements of income expressed as a percentage of gross revenues.

        Consolidated Statements of Income -- Percentage of Gross Revenues

<TABLE>
<CAPTION>
                                               For The Years Ended December 31,
                                                2001         2000          1999
                                                ----         ----          ----
<S>                                       <C>            <C>            <C>
Revenues: (2)
--------
      Casino                                   95.8%        97.5%         97.6%
      Rooms                                     0.8%         0.0%          0.0%
      Food and beverage                         2.4%         1.6%          1.6%
      Other                                     1.0%         0.9%          0.8%
                                          ------------------------------------
                                              100.0%       100.0%        100.0%
         Less promotional allowances           -6.3%        -4.2%         -2.5%
                                          ------------------------------------
         Net revenues                          93.7%        95.8%         97.5%
                                          ------------------------------------
Costs and Expenses: (2)
------------------
      Casino                                   18.4%        17.9%         16.2%
      Rooms                                     0.5%         0.0%          0.0%
      Food and beverage                         2.2%         2.0%          1.9%
      Other                                     0.1%         0.0%          0.0%
      Gaming taxes                             25.1%        27.3%         27.3%
      Advertising and promotions                5.7%         6.8%          5.7%
      General and administrative               19.5%        21.8%         20.6%
      Economic incentive - City of Gary         2.7%         2.7%          3.0%
      Depreciation and amortization             6.5%         7.7%          7.0%
      Pre-opening expenses                      0.7%         0.0%          0.0%
      Loss on disposal of assets                0.0%         0.4%          0.0%
                                          ------------------------------------
               Total costs and expenses        81.4%        86.6%         81.7%
                                          ------------------------------------
Operating income (2)                           12.3%         9.2%         15.8%
                                          ------------------------------------
Other Income (Expense):
---------------------
</TABLE>

                                       15

<PAGE>
<TABLE>
<S>                                               <C>        <C>        <C>
      Loss on investment in
         Buffington Harbor Riverboats, L.L.C.       -2.0%      -1.7%      -2.4%
      Interest income                                0.3%       0.8%       0.9%
      Interest expense                             -11.5%     -12.8%     -12.9%
      Other nonoperating expense                    -0.1%      -0.1%      -0.1%
                                                  ----------------------------
               Total other income (expense)        -13.3%     -13.8%     -14.5%
                                                  ----------------------------
Income (loss) before extraordinary item             -1.0%      -4.6%       1.2%
---------------------------------------           ----------------------------
Extraordinary item:
      Loss on bond redemption                        0.0%      -0.3%     -12.7%
Net loss:                                           -1.0%      -4.9%     -11.5%
                                                  ============================
Adjusted EBITDA:       (in millions) (1)          $ 27.0     $ 21.2     $ 27.3
----------------                                  ============================
</TABLE>

(1)  For a definition of Adjusted EBITDA, see Note 3 of Notes to Selected
     Consolidated Financial Data contained in Item 6.

(2)  New accounting guidance, effective January 1, 2001, requires that the cost
     of the cash-back component of our Slot Club program, including promotional
     coupons, be treated as a reduction of revenues. These costs had previously
     been reflected in costs and expenses. The new guidance impacts only the
     classification of these costs on our income statement. It does not impact
     operating profit or EBITDA. The prior years' results have been reclassified
     to reflect the impact of implementing this new guidance.

2001 Compared to 2000

     Consolidated gross revenues for the year ended December 31, 2001 amounted
to approximately $138,367,000, an increase of $19,916,000 or 16.8% over gross
revenues recorded in the year ended December 31, 2000. Majestic Star, for the
year ended December 31, 2001, accounted for approximately $125,535,000 (90.7%),
an increase of $7,084,000 compared to the year ended December 31, 2000. The 6.0%
increase in gross revenues at Majestic Star was primarily attributable to a
$10,114,000 or 10.9% increase in slot revenue partially offset by a $3,374,000
or 15.1% decline in table game revenues as a result of a 11.7% decrease in the
table drop and a lower than anticipated table hold.

     Consolidated casino revenues during the year ended December 31, 2001
totaled approximately $132,554,000, of which slot machines accounted for
approximately $112,211,000 (84.7%) and table games accounted for approximately
$20,343,000 (15.3%). Majestic Star's casino revenues during the year ended
December 31, 2001 totaled approximately $122,195,000, an increase of
approximately $6,740,000 or 5.8%, of which slot machines accounted for
approximately $103,200,000 (84.5%) and table games accounted for approximately
$18,995,000 (15.5%). The average number of slot machines in operation was 1,423
during the year ended December 31, 2001, compared to 1,435 during the year ended
December 31, 2000. The average win per slot machine per day increased to
approximately $199 for the year ended December 31, 2001, from approximately $177
during the year ended December 31, 2000. During the year ended December 31,
2001, slot machine coin-in and win increased by approximately 6.2% and 10.9%,
respectively, compared to the year ended December 31, 2000, resulting in a
higher win per slot machine per day. The percentage increases in slot coin-in
and win is partially attributed to an aggressive multi-media marketing campaign
(including direct mail) emphasizing the tag line "Change Your Luck" combined
with a reconfiguration of the casino gaming floor which optimized the available
space to accommodate the casino patrons. The average number of table games in
operation during the year ended December 31, 2001, decreased to 50 from 55
during the year ended December 31, 2000. The average win per table game per day
during the year ended December 31, 2001, decreased to approximately $1,033,
compared to approximately $1,108 during the year ended December 31, 2000. During
the year ended December 31, 2001, the decline in table games revenues was
attributable to a decline of approximately $16,311,000 or 11.7% in table drop
and a decrease in the table hold from 16.0% to 15.4% in comparison to the prior
year. The average daily win per state passenger count was approximately $38 and
the average daily win per patron was approximately $67 during the year ended
December 31, 2001, compared to an average daily win per state passenger count of
approximately $37 and an average daily win per patron of

                                       16

<PAGE>

approximately $68 during the year ended December 31, 2000.

     Consolidated room revenues totaled $1,079,000 or 0.78% of the gross revenue
for the year ended December 31, 2001 and was attributed to the 25 days of
operations for the Fitzgeralds properties. Majestic Star does not operate a
hotel.

     Consolidated food and beverage revenue for the twelve months ended December
31, 2001 totaled approximately $3,319,000 or 2.4% of gross revenues, compared to
approximately $1,925,000 or 1.6% of gross revenues for the year ended December
31, 2000. Majestic Star accounted for approximately $2,129,000 or 64.1% of
consolidated food and beverage revenue for the twelve months ended December 31,
2001, an increase of $204,000 or 10.6% compared to the year ended December 31,
2000.

     Consolidated other revenues totaled approximately $1,416,000 or 1.0% of
consolidated gross revenues for the year ended December 31, 2001. Majestic Star
accounted for approximately $1,212,000 or 85.6% of other revenues, compared to
approximately $1,071,000 or 0.9% of gross revenues during the year ended
December 31, 2000. Other revenue at Majestic Star consisted primarily of
commission income.

     Consolidated promotional allowances deducted from the Company's gross
revenues for the years ended December 31, 2001 and 2000, were approximately
$8,774,000 or 6.3% of gross revenues and $5,018,000 or 4.2% of gross revenues,
respectively. Of this amount Majestic Star accounted for $6,464,000 or 73.7% of
consolidated promotional allowances, an increase of $1,446,000 or 28.8% compared
to the year ended December 31, 2000. Promotional allowances provided to the
Majestic Star's gaming patrons at facilities located in, and/or owned by BHR for
the year ended December 31, 2001 and 2000, totaled approximately $805,000 and
$435,000, respectively, and are characterized in the financial statements as an
expense. BHR and other third-party operators of food kiosks invoice the Majestic
Star monthly for these promotional allowances at cost, which approximates retail
value.

     Consolidated casino operating expenses for the year ended December 31,
2001, totaled approximately $25,517,000 or 18.4% of gross revenues and 19.3% of
casino revenues compared to approximately $21,180,000 or 17.9% of gross revenues
and 18.3% of casino revenues, respectively, for the year ended December 31,
2000. These expenses were primarily comprised of salaries, wages and benefits,
and operating expenses of the casino. Majestic Star accounted for approximately
$21,406,000 or 17.1% of Majestic Star gross revenues and 17.5% of Majestic Star
casino revenues compared to approximately $21,180,000 or 17.9% of gross revenues
and 18.3% of casino revenues, respectively, for the year ended December 31,
2000. The dollar increase of $226,000 in casino operating expenses is primarily
attributed to an increase of approximately $120,000 for gaming equipment rental
and other various casino operating expenses.

     Consolidated gaming taxes totaled approximately $34,835,000 for the year
ended December 31, 2001, compared to approximately $32,350,000 during the year
ended December 31, 2000. Gaming taxes are levied on adjusted gross receipts, as
defined by Indiana gaming laws, at the rate of 20%, plus $3 per passenger per
the state passenger count. Majestic Star accounted for approximately $34,026,000
and $32,350,000 of gaming taxes during the years ended December 31, 2001 and
2000, respectively. An additional $3,667,000 was paid during the year ended
December 31, 2001, compared to approximately $3,231,000 in the year ended
December 31, 2000, to the City of Gary under an economic incentive agreement
whereby Majestic Star pays 3% of adjusted gross receipts directly to the City.

     Advertising and promotion expenses includes salaries, wages and benefits of
the marketing and casino service departments, as well as promotions, advertising
and special events. Consolidated advertising and promotion expenses for the year
ended December 31, 2001 totaled approximately $7,830,000 or 5.7% of gross
revenues, compared to $8,020,000 or 6.8% for the year ended December 31, 2000.
Of this

                                       17

<PAGE>

amount, Majestic Star accounted for approximately $6,904,000 or 4.9% of gross
revenues for the year ended December 31, 2001 and approximately $8,020,000 or
6.8% of gross revenues for the year ended December 31, 2000. The $1,116,000 or
13.9% decrease in advertising and promotion expenses during the year ended
December 31, 2001 was primarily the result of a decrease in mass marketing
expenditures partially offset by an increase in operating supplies.

     Consolidated general and administrative expenses for the year ended
December 31, 2001 were approximately $26,934,000 or 19.5% of gross revenues,
compared to $25,800,000 or 21.8% of gross revenues during the year ended
December 31, 2000. Majestic Star accounted for approximately $25,364,000 or
94.2% of the general and administrative expenses for the year ended December 31,
2001 and $25,800,000 for the year ended December 31, 2000. These expenses
included approximately $6,317,000 for berthing fees paid to BHR, $6,151,000 for
marine operations including housekeeping, and $2,693,000 for security and
surveillance operations during the year ended December, 31, 2001. The dollar
decrease of $436,000 in these expenses is primarily attributed to a reduction of
approximately $651,000 in berthing fees, partially offset by higher professional
fees and fees to the Indiana Gaming Commission.

     Consolidated depreciation and amortization for the year ended December 31,
2001 was approximately $8,991,000 or 6.5% of gross revenues, compared to
approximately $9,114,000 or 7.7% of gross revenues during the year ended
December 31, 2000. Depreciation and amortization attributed to Majestic Star for
the year ended December 31, 2001 was approximately $8,070,000 compared to
approximately $9,114,000 during the year ended December 31, 2000. The dollar
decrease totaled approximately $1,044,000, of which approximately $491,000 is
depreciation expense and approximately $553,000 is amortization expense. The
decrease for the year ended December 31, 2001 is primarily attributable to
machinery and equipment being fully depreciated and deferred licensing fees
being fully amortized.

     The consolidated operating income for the year ended December 31, 2001 was
approximately $17,024,000 or 12.3% of gross revenues, compared to an operating
income for the year ended December 31, 2000 of $10,920,000 or 9.2% of gross
revenues. Operating income attributed to the Majestic Star for the year ended
December 31, 2001 was approximately $17,302,000 or 13.8% of gross Majestic Star
revenues. During the year ended December 31, 2001, Majestic Star had a net loss
on the disposition of assets totaling approximately $12,000. The $6,382,000 or
58.4% increase is attributed to a 6.0% increase in gross Majestic Star revenues
partially offset by increased expenses as previously discussed.

     The consolidated net interest expense for the year ended December 31, 2001
was $15,628,000 or approximately 11.3% of gross revenues compared to $14,105,000
or approximately 11.9% for the same period last year. Net interest expense
attributed to the Majestic Star for the year ended December 31, 2001 was
$14,636,000 or approximately 10.6% of gross revenues, compared to $14,105,000
for the same period last year. The $531,000 increase in net interest expense at
Majestic Star is primarily attributed to a $712,000 decrease in interest income,
partially offset by a $181,000 increase in interest expense associated with the
line of credit.

     The Company's expense on the redemption of its 12-3/4% Senior Secured Notes
for the year ended December 31, 2000 was approximately $382,500 and is
classified as an extraordinary item. The loss relating to its investment in BHR
(primarily for depreciation and amortization) for the years ended December 31,
2001 and 2000 was approximately $2,798,000 and $2,059,000, respectively. Costs
of approximately $6,317,000 and $6,968,000 associated with operating BHR are
included in the operating expense line "General and Administrative" and are
fully reflected in operating income for the years ended December 31, 2001 and
2000, respectively. Other non-operating expenses of $149,000 and $125,000 for
the years ended December 31, 2001 and 2000, respectively, represent fees
associated with the line of credit.

     As a result of the foregoing, the Company realized a consolidated loss of
approximately

                                       18

<PAGE>

$1,551,000 during the year ended December 31, 2001, compared to a loss (before
the extraordinary item) of $5,368,000 during the year ended December 31, 2000.
The Majestic Star realized a loss of $280,000 during the year ended December 31,
2001, compared to a loss (before the extraordinary item) of $5,368,000 during
the year ended December 31, 2000. The Majestic Star net losses were
approximately $280,000 and $5,750,000 during the years ended December 31, 2001,
and 2000, respectively.

2000 Compared to 1999

     Gross revenues for the year ended December 31, 2000 amounted to
approximately $118,451,000, a decrease of $1,726,000 over gross revenues
recorded in the year ended December 31, 1999. The 1.4% decrease in gross
revenues was primarily attributable to a $5,400,000 decline in table game
revenues primarily as a result of a 5.4% decrease in table drop and a lower than
anticipated table hold partially offset by a $3,600,000 or 4.0% increase in slot
revenues.

     Casino revenues during the year ended December 31, 2000 totaled
approximately $115,455,000, of which slot machines accounted for approximately
$93,086,000 (80.6%) and table games accounted for approximately $22,369,000
(19.4%). The average number of slot machines in operation was 1,435 during the
year ended December 31, 2000, compared to 1,436 during the year ended December
31, 1999. The average win per slot machine per day increased to approximately
$177 for the year ended December 31, 2000, from approximately $171 during the
year ended December 31, 1999. During the year ended December 31, 2000, slot
machine coin-in and win increased by approximately 3.8% and 4.0%, respectively,
compared to the year ended December 31, 1999, resulting in a higher win per slot
machine per day. The percentage increases in slot coin-in and win is partially
attributed to an aggressive multi-media marketing campaign emphasizing the
registered tag line "We've Got Your Slots"(C) combined with a reconfiguration of
the casino gaming floor which optimized the available space to accommodate the
casino patrons. The average number of table games in operation during the year
ended December 31, 2000 decreased to 55 from 58 during the year ended December
31, 1999. The average win per table game per day during the year ended December
31, 2000 decreased to approximately $1,108, compared to approximately $1,314
during the year ended December 31, 1999. During the year ended December 31,
2000, the decline in table games revenues were attributable to a decline of
approximately $7,904,000 or 5.4% in table drop and a decrease in the table hold
from 18.8% to 16.0% in comparison to the prior year. The average daily win per
state passenger count was approximately $38 and the average daily win per patron
was approximately $67 during the year ended December 31, 2000, compared to an
average daily win per state passenger count of approximately $37 and an average
daily win per patron of approximately $67 for the year ended December 31, 1999.

     Food and beverage revenues for the twelve months ended December 31, 2000
totaled approximately $1,925,000 or 1.6% of gross revenues, compared to
approximately $1,949,000 or 1.6% of gross revenues for the year ended December
31, 1999. Other revenues totaled approximately $1,071,000 or 0.9% of gross
revenues for the year ended December 31, 2000, consist primarily of commission
income, compared to approximately $960,000 during the year ended December 31,
1999.

     Promotional allowances included in the Company's gross food and casino
revenues for the year ended December 31, 2000 and 1999 were approximately
$5,018,000 and $3,005,000, respectively. Promotional allowances provided to the
Company's gaming patrons at facilities located in, and/or owned by BHR for the
year ended December 31, 2000 and 1999 totaled approximately $435,000 and
$758,000, respectively, and are characterized in the financial statements as an
expense. BHR and other third-party operators of food kiosks invoice the Company
monthly for these promotional allowances at cost, which approximates retail
value.

     Casino operating expenses for the year ended December 31, 2000 totaled
approximately $21,180,000 or 17.9% of gross revenues and 18.3% of casino
revenues compared to approximately $19,443,000 or 16.2% of gross revenues and
16.6% of casino revenues for the year ended December 31,

                                       19

<PAGE>

1999. These expenses are primarily comprised of salaries, wages and benefits,
and operating expenses of the casino. The dollar increase of $1,737,000 in
casino operating expenses is primarily attributed to approximately $669,000 for
gaming equipment rental primarily for participation games including Wheel of
Fortune(C), Jeopardy(C) and Monopoly(C), approximately $400,000 associated with
Club Majestic and approximately $248,000 for repair and maintenance of gaming
equipment, primarily to upgrade bill validators and monitors on video games.

     Gaming taxes totaled approximately $32,350,000 for the year ended December
31, 2000, compared to approximately $32,900,000 for the year ended December 31,
1999. These taxes are levied on adjusted gross receipts, as defined by Indiana
gaming laws, at the rate of 20% plus $3 per passenger per the state passenger
count. An additional $3,231,000 was paid during the year ended December 31,
2000, compared to approximately $3,626,000 in the year ended December 31, 1999,
to the City of Gary under an economic incentive agreement whereby the Company
pays 3% of the adjusted gross receipts directly to the City.

     Advertising and promotion expenses for the year ended December 31, 2000
totaled approximately $8,020,000 or 6.8% of gross revenues, compared to
approximately $6,816,000 or 5.7% of gross revenues during the year ended
December 31, 1999. Advertising and promotion expenses included salaries, wages
and benefits of the marketing and casino service departments, as well as
promotions, advertising and special events. The $1,204,000 or 17.7% increase in
advertising and promotion expenses during the year ended December 31, 2000 was
primarily the result of an increase of $456,000 in television advertising and
$414,000 in postage and direct mail advertising as part of undertaking an
aggressive and integrated brand image campaign that was conducted during the
first and second quarters of 2000.

     General and administrative expenses for the year ended December 31, 2000
were approximately $25,800,000 or 21.8% of gross revenues, compared to
$24,738,000 or 20.6% of gross revenues during the year ended December 31, 1999.
These expenses included approximately $6,968,000 for berthing fees paid to BHR,
$6,402,000 for marine operations including housekeeping, and $2,608,000 for
security and surveillance operations during the year ended December 31, 2000.
The dollar increase of $1,062,000 in these expenses is primarily attributed to
approximately $380,000 in payroll and related expenses, an increase of
approximately $326,000 in insurance related expenses and approximately $250,000
for acquisition related expenses incurred by Majestic Investor, LLC, an
unrestricted subsidiary.

     Depreciation and amortization for the year ended December 31, 2000 was
approximately $9,114,000 or 7.7% of gross revenues, compared to approximately
$8,375,000 or 7.0% of gross revenues, during the year ended December 31, 1999.
The dollar increase totaled approximately $739,000, of which approximately
$514,000 is depreciation expense and approximately $225,000 is amortization
expense. The dollar increase for the year ended December 31, 2000 is primarily
attributable to new machinery and equipment placed into service during the past
year and amortization of the debt issue costs associated with the June 1999
issuance of the 10 7-8% Senior Secured Notes.

     Operating income for the year ended December 31, 2000 was approximately
$10,920,000 or 9.2% of gross revenues, compared to an operating income for the
year ended December 31, 1999 of $18,931,000, or 15.7% of gross revenues. During
the year ended December 31, 2000, the Company had a net loss on the disposition
of assets totaling approximately $417,000. The $8,011,000 or 42.3% decrease in
operating income is principally attributable to increased expenditures of
approximately $4,494,000 associated with casino operations, a decrease in gross
revenues of approximately $1,726,000 and approximately $1,062,000 in increased
general and administrative expenses including $125,000 in non-operating
expenses, and approximately $250,000 for acquisition related expenses incurred
by Majestic Investor, LLC, an unrestricted subsidiary, and an increase of
approximately $739,000 for depreciation and amortization as previously
discussed.

     Net interest expense for the year ended December 31, 2000 was $14,105,000
or approximately

                                       20

<PAGE>

11.9% of gross revenues, compared to $14,605,000 or approximately 12.2% for the
same period last year. The $500,000 decrease in net interest expense is
primarily attributable to the refinancing of the 12-3/4% Senior Secured Notes
with Contingent Interest and the repayment of the $8.8 million demand note to
BDI both of which occurred during the second quarter of 1999.

     The Company's expense on the redemption of its 12-3/4% Senior Secured Notes
for the years ended December 31, 2000 and 1999 was approximately $382,500 and
$15,238,000, respectively, and is classified as an extraordinary item. The loss
relating to its investment in BHR for the years ended December 31, 2000 and 1999
was approximately $2,059,000 and $2,848,000, respectively. Costs of
approximately $6,968,000 associated with operating BHR are included in the
operating expense line "General and Administrative" and are fully reflected in
operating income. Other non-operating expenses of $125,000 for the year ended
December 31, 2000 represent fees associated with the line of credit.

     As a result of the foregoing, the Company realized a loss (before the
extraordinary item) of $5,368,000 during the year ended December 31, 2000,
compared to income (before the extraordinary item) of $1,478,000 in the year
ended December 31, 1999. Net losses were approximately $5,750,000 and
$13,760,000 during the years ended December 31, 2000 and 1999, respectively.

Earnings Before Interest, Income Taxes, Depreciation and Amortization

     Adjusted EBITDA is presented solely as a supplemental disclosure and is
used by the Company to assist in the evaluation of the cash generating ability
of its gaming business. Consolidated Adjusted EBITDA during the twelve months
ended December 31, 2001 was approximately $27,045,000. Adjusted EBITDA
attributed to the Majestic Star during the twelve months ended December 31, 2001
was approximately $25,385,000 or 20.2% of gross Majestic Star revenues, compared
to approximately $21,223,000 or 17.9% of gross Majestic Star revenues during the
twelve months ended December 31, 2000. The $4,162,000 increase in Adjusted
EBITDA at Majestic Star is primarily the result of a decrease in operating
expenditures and an increase in casino revenue. Adjusted EBITDA during 2001
excludes pre-opening costs, loss on investment in BHR, line of credit fees and
loss on disposal of assets. Adjusted EBITDA during 2000 excludes loss on bond
redemption, loss on investment in BHR, line of credit fees, loss on disposal of
assets, and $772,000 of non-operating expenses associated with dockside lobbying
initiatives, economic development and extraordinary items.

     Adjusted EBITDA should be viewed only in conjunction with all of the
Company's financial data and statements, and should not be construed as an
alternative either to income from operations (as an indicator of the Company's
operating performance) or to cash flows from operating activities as a measure
of liquidity.

Liquidity and Capital Resources

     At December 31, 2001, the Company had cash and cash equivalents of
approximately $25.9 million. This amount included $17.7 million at Majestic
Investor Holdings, LLC and $8.2 million at Majestic Star. During the year ended
December 31, 2001, the Company's capital expenditures were approximately $5.0
million, which included approximately $2.5 million for vessel and barge
improvements, $2.2 million for slot machines and other gaming equipment,
$140,000 for furniture and equipment, and $132,000 for computer equipment and
software. These capital expenditures include an additional $2.2 million for the
settlement of disputed use tax payments associated with the chartered vessel and
the subsequent construction of the permanent vessel. The Company also made a
capital contribution of approximately $215,000 to BHR during the year ended
December 31, 2001.

     The Company, including the accounts of Majestic Investor, LLC, has met its
capital requirements to date through net cash from operations, capital
contributions and equipment loans. For the year ended December 31, 2001, net
cash provided by operating activities totaled approximately $12.4 million,


                                       21

<PAGE>

compared to net cash provided by operating activities of approximately $4.7
million during the year ended December 31, 2000. At Majestic Star for the year
ended December 31, 2001, net cash provided by operating activities totaled
approximately $8.8 million and cash used by investing activities totaled
approximately $4.4 million, compared to approximately $6.2 million provided by
operating activities and $19.8 million used in investing activities, during the
year ended December 31, 2000. At the Majestic Star for the year ended December
31, 2001, cash used by financing activities totaled approximately $8.8 million,
which included net repayments of $7.8 million under the line of credit facility,
compared to $6.0 million provided by financing activities during the year ended
December 31, 2000. As of April 1, 2002, there are no outstanding borrowings
under the Majestic Star Credit Facility.

     Management believes that the Company's cash flow from operations and its
current lines of credit will be adequate to meet the Company's anticipated
future requirements for working capital, its capital expenditures and scheduled
payments of interest and principal on the Senior Secured Notes, lease payments
to BHPA and other permitted indebtedness for the year 2002. No assurance can be
given, however, that such proceeds and operating cash flow, in light of
increased competition, principally dockside gambling in Illinois and the
purchase of certain Indiana gaming facilities by larger more recognized brand
names, will be sufficient for such purposes. If necessary and to the extent
permitted under the Indenture, the Company will seek additional financing
through borrowings and debt or equity financing. There can be no assurance that
additional financing, if needed, will be available to the Company, or that, if
available, the financing will be on terms favorable to the Company. In addition,
there is no assurance that the Company's estimate of its reasonably anticipated
liquidity needs is accurate or that unforeseen events will not occur, resulting
in the need to raise additional funds.

New Accounting Principles

     We have adopted Emerging Issues Task Force ("EITF") No. 00-14, "Accounting
for Certain Sales Incentives," EITF 00-22, "Accounting for `Points' and Certain
Other Time-Based or Volume-Based Sales Incentive Offers, and Offers for Free
Products or Services to Be Delivered in the Future," and EITF 00-25, "Accounting
for Consideration from a Vendor to a Retailer in Connection with the Purchase or
Promotion of the Vendor's Products," which required the cash-back component of
the Company's Slot Club reward program, including promotional coupons, be
classified as a reduction of revenues.

     In June 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations," SFAS No. 142, "Goodwill and Other Intangible Assets" and SFAS No.
143, "Accounting for Asset Retirement Obligations." SFAS No. 141 requires all
business combinations to be accounted for using the purchase method of
accounting. SFAS No. 141 is required to be implemented for all acquisitions
initiated after June 30, 2001, and all business combinations accounted for using
the purchase method for which the date of acquisition is July 1, 2001, or later.
We applied SFAS No. 141 for our acquisition of the Fitzgeralds assets.

     Under SFAS No. 142, goodwill and other indefinite lived intangible assets
are no longer subject to amortization over their useful lives, rather, they are
subject to assessments for impairment at least annually. Also, under SFAS No.
142, an intangible asset should be recognized if the benefit of the intangible
asset is obtained through contractual or other legal rights or if the intangible
asset can be sold, transferred, licensed, rented or exchanged. Such intangibles
will be amortized over their useful lives. Under SFAS No. 142, our acquisition
of the Fitzgeralds assets was immediately subject to the provisions of SFAS No.
142. We will test these assets for impairment at least annually.

     Under SFAS No. 143, the fair value of a liability for an asset retirement
obligation is required to be recognized in the period in which it is incurred if
a reasonable estimate of fair value can be made. The associated asset retirement
costs are capitalized as part of the carrying amount of the long-lived asset.
SFAS No. 143 will be implemented by us on January 1, 2002. Adoption of SFAS No.
143 is not anticipated to have a material impact on our consolidated financial
statements.

                                       22

<PAGE>


     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" which supercedes SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of" and amends Accounting Principles Board ("APB") Opinion No. 30,
"Reporting the Results of Operations - Reporting the Effect of Disposal of a
Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions." SFAS No. 144 addresses financial accounting and
reporting for the impairment or disposal of long-lived assets and is effective
for fiscal years beginning after December 15, 2001, and interim periods within
those fiscal years. Adoption of SFAS No. 144 will not have a material impact on
our consolidated financial statements.

Critical Accounting Policies

     Our consolidated financial statements are prepared in accordance with
accounting principles generally accepted in the United States of America, which
requires our management to make estimates and assumptions about the effects of
matters that are inherently uncertain. We have summarized our significant
accounting policies in Note 2 to our consolidated financial statements. Of our
accounting policies, we believe the following may involve a higher degree of
judgment and complexity.

     Revenue Recognition - Casino revenues is the net win from gaming
activities, which is the difference between gaming wins and losses. Hotel and
other revenue is recognized at the time the related service is performed.

     Goodwill - We have approximately $10.6 million of goodwill recorded on our
balance sheet at December 31, 2001 related to the acquisition of the Fitzgeralds
properties. We regularly evaluate our acquired businesses for potential
impairment indicators. Additionally, we adopted the provisions of SFAS No. 142,
"Goodwill and Other Intangible Assets," on January 1, 2002, that require us to
perform impairment testing at least annually. Our judgments regarding the
existence of impairment indicators are based on, among other things, the
regulatory and market status and operational performance of each of our acquired
businesses. Future events could significantly impact our judgments and any
resulting impairment loss could have a material adverse impact on our financial
condition and results of operations.

     Property and Equipment - At December 31, 2001, we have approximately $170.2
million of net property and equipment recorded on our balance sheet. Third-party
valuations were obtained for property and equipment and intangible assets
acquired in connection with the Fitzgeralds acquisitions. We depreciate our
assets on a straight-line basis over their estimated useful lives. The estimate
of the useful lives is based on the nature of the asset as well as our current
operating strategy. Future events, such as property expansions, new competition
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. In assessing the recoverability of the carrying value of property and
equipment, we must make assumptions regarding estimated future cash flows and
other factors. If these estimates or the related assumptions change in the
future, we may be required to record impairment charges for these assets.

     Slot Club Liability - The Fitzgeralds casinos offer a program whereby
participants can accumulate points for casino wagering that can currently be
redeemed for cash, lodging, food and beverages and merchandise. A liability is
recorded for the estimate of unredeemed points based upon the Fitzgeralds
casinos' redemption history. This liability can be impacted by changes in the
program, increases in membership and changes in the redemption patterns of the
participants.

     Litigation, Claims and Assessments - We also utilize estimates for
litigation, claims and assessments. These estimates are based upon our knowledge
and experience about past and current events and also upon reasonable future
events. Actual results may differ from those estimates.

                                       23

<PAGE>

Contractual Commitments:

     The following table summarizes our obligations and commitments to make
future payments under certain contracts, including long-term debt obligations,
capitalized leases and operating leases at December 31, 2001.

<TABLE>
<CAPTION>
                           -----------------------------------------------------------------------------------------------
                                                                Payments Due By Year
                           -----------------------------------------------------------------------------------------------
Contractual Obligations       2002         2003         2004        2005          2006        Thereafter        Total
                           ------------ ------------ ------------ ---------- --------------- -------------- --------------
<S>                        <C>          <C>          <C>          <C>        <C>             <C>            <C>
Long-Term Debt              $        -   $        -   $        -   $      -   $ 128,556,629   $145,085,432   $273,642,061
Capital Leases                 156,574      133,066       84,346     37,460               -              -        411,446
Operating Leases             1,422,407    1,254,338      972,948    811,604         774,092        774,092      6,009,481
                           ------------ ------------ ------------ ---------- --------------- -------------- --------------
     Total                  $1,578,981   $1,387,404   $1,057,294   $849,064   $ 129,330,721   $145,859,524   $280,062,988
</TABLE>

<TABLE>
<CAPTION>
                                   -----------------------------------------------------------------------------------------
                                                                     Payments Due By Year
                                   -----------------------------------------------------------------------------------------
Other Commercial Commitments           2002         2003        2004        2005        2006     Thereafter       Total
                                   -------------- ---------- ----------- ----------- ----------- ----------- ---------------
<S>                                <C>            <C>         <C>        <C>          <C>         <C>         <C>
Lines of Credit                     $  6,500,000  $       -   $       -  $        -   $       -   $       -   $ 6,500,000
     Total                          $  6,500,000  $       -   $       -  $        -   $       -   $       -   $ 6,500,000
</TABLE>


FACTORS THAT MAY AFFECT FUTURE RESULTS

Risks Related to Our Substantial Debt

Our significant indebtedness could adversely affect our financial health.

     We have a significant amount of debt. We currently have outstanding $130
million of long-term debt represented by the Majestic Star Senior Secured Notes
and $152.6 million of long-term debt represented by the Investor Holdings Senior
Secured Notes. In addition, the Majestic Star Indenture will permit us to incur
additional debt in certain circumstances, including to finance the purchase of
furniture and equipment.

     Our high level of debt could have significant effects on our business. For
example, it could, among other things:

     -   make it more difficult for us to satisfy our obligations with respect
         to the Majestic Star Senior Secured Notes and our other outstanding
         indebtedness;

     -   increase our vulnerability to adverse economic and industry conditions
         or a downturn in our business;

     -   result in an event of default if we fail to comply with the financial
         and other restrictive covenants contained in the Majestic Star
         Indenture or in the Majestic Star Credit Facility, which event of
         default could result in all of our indebtedness becoming immediately
         due and payable and would permit some or all of our lenders to
         foreclose on our assets securing such indebtedness;

     -   limit our ability to fund or obtain additional financing for future
         working capital, capital expenditures and other general financial
         requirements;

     -   require us to dedicate a substantial portion of our cash flow from
         operations to payments on our indebtedness, thereby reducing the
         availability of our cash flow to fund working capital, capital
         expenditures, development projects, acquisitions and other general
         corporate purposes;

                                       24

<PAGE>

     -   limit our flexibility in planning for, or reacting to, changes in our
         business and industry; and

     -   place us at a competitive disadvantage compared to our competitors that
         have less debt.

     The occurrence of any one of these events could have a material adverse
effect on our business, financial condition, results of operations and
prospects.

We may not be able to generate sufficient cash flow to service our debt.

     We might not be able to generate sufficient cash flow to service our debt,
to repay the Majestic Star Senior Secured Notes when due or to meet
unanticipated capital needs or shortfalls in our projections. We plan to be able
to service our debt and repay the Majestic Star Senior Secured Notes when due
with cash from operations. Our ability to generate sufficient cash flow to
satisfy our obligations will depend on the future performance of our gaming
operations, which is subject to many economic, political, competitive,
regulatory and other factors that we are not able to control. However, if cash
flows from operations are not sufficient to satisfy our obligations, we may need
to seek additional financing in the debt or equity markets, refinance the
Majestic Star Senior Secured Notes, sell selected assets or reduce or delay
planned activities and capital expenditures. Any such financings or sale of
assets might not be available on economically favorable terms, if at all, and
may be difficult because of governmental restrictions on ownership. In the event
that we are left without sufficient liquidity to meet our debt service
requirements, an event of default would occur under the Majestic Star Indenture
and the Majestic Star Credit Facility. The Majestic Star Senior Secured Notes
and the Majestic Star Credit Facility are secured by substantially all of the
Majestic Star casino's current and future assets.

The Majestic Star Indenture and the Majestic Star Credit Facility contain
covenants that significantly restrict our operations.

     The Majestic Star Indenture and the Majestic Star Credit Facility does, and
any other future debt agreement will, contain numerous covenants imposing
financial and operating restrictions on our business. These restrictions may
affect our ability to operate our business, limit our ability to take advantage
of potential business opportunities as they arise and adversely affect the
conduct of our current business. These covenants will place restrictions on our
ability and the ability of our subsidiaries to, among other things:

     -   incur more debt;

     -   pay dividends, redeem or repurchase our stock or make other
         distributions;

     -   make acquisitions or investments;

     -   use assets as security in other transactions;

     -   enter into transactions with affiliates;

     -   merge or consolidate with others;

     -   dispose of assets or use asset sale proceeds;

     -   create liens on our assets; and

     -   extend credit.

     The Majestic Star Credit Facility also requires us to meet a number of
     financial ratios and tests. Our

                                       25

<PAGE>

ability to meet these ratios and tests and to comply with other provisions
governing our indebtedness may be adversely affected by our operations and by
changes in economic or business conditions or other events beyond our control.

Risks Related to Our Business

We may be unable to successfully integrate the three Fitzgeralds casinos, and we
may not realize any of the anticipated benefits of the acquisition.

     We acquired the three Fitzgeralds casino properties from Fitzgeralds and
certain of its affiliates on December 6, 2001. We cannot assure you that we will
be able to integrate or manage the Fitzgeralds properties effectively or realize
any of the anticipated benefits of the acquisition, including expected cost
reductions. Our ability to integrate the three Fitzgeralds casino properties, to
realize the expected cost reductions and to achieve our objectives in connection
with the Fitzgeralds acquisition is highly dependent on, among other things, our
ability to maintain effective senior management teams at Fitzgeralds Tunica,
Fitzgeralds Black Hawk and Fitzgeralds Las Vegas. We plan to maintain such
management through retention of certain current executives, relocation of
certain Majestic executives to the Fitzgeralds properties and the attraction of
new executives. If, for any reason, these executives do not continue to be
active in management after the acquisition, or we fail to attract capable new
executives, our operations after consummation of the Fitzgeralds acquisition
could be materially adversely affected. In addition, certain of our executives
provide management services to Investor Holdings and its subsidiaries and to
Majestic Star. Accordingly, such executives will not be able to devote all of
their time to Majestic Star.

We face significant competition in each market where we operate.

     We face intense competition in each of the markets in which our gaming
facilities are located. Many of our competitors have significantly greater name
recognition and financial, marketing and other resources than we do. Our
properties compete principally with other gaming properties in or near
California, Illinois, Indiana, Nevada, Mississippi and Colorado. In some of
these jurisdictions, competition is expected to intensify as new gaming
operations enter these markets and existing competitors consolidate with one
another or expand or enhance their operations. In addition, we compete with
gaming facilities nationwide, including casinos located on Indian reservations
and other land-based casinos in Nevada and Atlantic City, as well as elsewhere,
not only for customers but also for employees and potential future gaming sites.
We also compete, to some extent, with other forms of gaming on both a local and
national level, including state-sponsored lotteries, Internet gaming, on-and
off-track wagering and card parlors. The expansion of legalized gaming to new
jurisdictions throughout the United States also has increased competition faced
by us and will continue to do so in the future. Additionally, if gaming were
legalized in jurisdictions near our properties where gaming currently is not
permitted, we would face additional competition.

     Increased competition may require us to make substantial capital
expenditures to maintain and enhance the competitive positions of our
properties, including updating slot machines to reflect changing technology,
refurbishing rooms and public service areas periodically, replacing obsolete
equipment on an ongoing basis and making other expenditures to increase the
attractiveness and add to the appeal of our properties. Because we are highly
leveraged, after satisfying our obligations under our outstanding indebtedness,
there can be no assurance that we will have sufficient funds to undertake these
expenditures or that we will be able to obtain sufficient financing to fund such
expenditures. If we are unable to make such expenditures, our competitive
position and our results of operations could be materially adversely affected.

Extensive government regulation continuously impacts our operations.

     The ownership, management and operation of gaming facilities is subject to
extensive laws, regulations and ordinances which are administered by various
federal, state and local government entities and agencies. The gaming
authorities located in the jurisdictions in which we operate have broad
authority and

                                       26

<PAGE>

discretion to require us and our officers, directors, managers, members,
employees and certain security holders to obtain various licenses,
registrations, permits, findings of suitability and other approvals. To enforce
applicable gaming regulations, gaming authorities may, among other things,
limit, suspend or revoke the licenses of any gaming entity or individual, and
may levy fines or forfeiture of assets against us or individuals for violations
of gaming laws or regulations. Any of these actions would have a material
adverse effect on us.

     Government regulations require us to:

     -   pay gaming fees and taxes in each state where we operate a casino;

     -   obtain a gaming license in each state where we operate a casino, which
         we must have renewed periodically and which may be suspended or revoked
         if we do not meet detailed regulatory requirements;

     -   receive and maintain federal and state environmental approvals; and

     -   receive and maintain local licenses to sell alcoholic beverages in our
         casinos.

     No assurances can be given that any new gaming licenses, liquor licenses,
registrations, findings of suitability, permits and approvals, particularly
those related to any proposed expansion, will be given or that existing ones
will be renewed when they expire. We know of no reason why our existing gaming
licenses would not be renewed or maintained, or why new licenses would not be
granted to us; however, any failure to renew or maintain our licenses or receive
new licenses when necessary would have a material adverse effect on us.

     The compliance costs associated with these laws, regulations and licenses
are significant. A change in the laws, regulations and licenses applicable to
our business or a violation of any current or future laws or regulations of our
gaming licenses could require us to make material expenditures or could
otherwise materially adversely affect our business or financial results.

Legislation at local referenda on gaming may restrict or adversely impact our
operations.

     The casino entertainment industry is subject to political and regulatory
uncertainty. In some of the jurisdictions in which we currently operate or from
which we attract customers, or in which we may expand, gaming is subject to
local referenda. If the results of a referendum held in a jurisdiction in which
we operate were to restrict gaming in whole or in part or if the results of a
referendum in a nearby non-gaming jurisdiction were to permit gaming, our
results of operations could be negatively impacted.

Many of our employees belong to unions; any labor disruptions, work stoppages or
significant union imposed wage increases could have an adverse impact on our
business.

     As of December 31, 2001, the Majestic Star Casino employed approximately
965 people and the BHR Joint Venture employed approximately 366 people. Any
labor disruptions or work stoppages could have a material adverse effect on our
operations. A significant number of such employees are unionized.

Energy price increases may adversely affect our costs of operations and our
revenues.

     Our casino properties use significant amounts of electricity, natural gas
and other forms of energy. While no shortages of energy have been experienced,
the recent substantial increases in the cost of electricity in the United States
will negatively affect our operating results. The extent of the impact is
subject to the magnitude and duration of the energy price increases, but this
impact could be material. In addition, energy

                                       27

<PAGE>

price increases in cities that constitute a significant source of customers for
our properties could result in a decline in disposable income of potential
customers and a corresponding decrease in visitation to our properties, which
could negatively impact our revenues.

The casino industry generally is dependent on a number of factors that are
beyond our control.

     The economic health of the casino industry is affected by a number of
factors that are beyond our control, including: (i) general economic conditions;
(ii) levels of disposable income of casino patrons; (iii) increased
transportation costs resulting in decreased travel by patrons; (iv) local
conditions in key gaming markets, including seasonal and weather-related
factors; (v) increase in gaming taxes or fees; (vi) competitive conditions in
the gaming industry and in particular gaming markets, including the effect of
such conditions on the pricing of our games and products; and (vii) the relative
popularity of entertainment alternatives to casino gaming that compete for the
leisure dollar. Any of these factors could negatively impact the casino industry
generally, and as a result, our revenues and results of operations.

Continuing effects of the terrorist attacks on the World Trade Center in New
York and the Pentagon in Washington, D.C., and any future occurrences of
terrorist or other destabilizing events, could negatively affect our revenues
and cash flow.

     On September 11, 2001, the World Trade Center buildings in New York City
and the Pentagon in Washington, D.C. were attacked by terrorists using hijacked
airplanes. The effects of these events have included a decline in vacation
travel and tourism due to, among other factors, fears regarding additional acts
of terrorism, and reduced operations by airlines due to decreased demands for
air travel, new security directives and increased costs. The magnitude and
duration of these effects is unknown and cannot be predicted. Any decline in
vacation travel and tourism could adversely affect our revenues, particularly
with respect to Fitzgeralds Las Vegas, where the majority of our customers rely
on air travel to visit our casino property. Continued or even worsening negative
market conditions related to those terrorist actions, any future occurrences of
terrorist or other destabilizing events, and other actions that perpetuate a
climate of war could cause existing and potential customers to further delay and
cancel travel, convention and vacation plans, could decrease wagering and
increase costs, and as a result could adversely affect our revenues and cash
flow in the future.

We are prohibited by the Majestic Star Indenture from engaging in certain
transactions with Investor and Investor Holdings

     We are prohibited from engaging in transactions with Investor, Investor
Holdings and its subsidiaries other than on an arms length basis and, if a
proposed transaction exceeds $2.0 million in value, we may only participate in
such transaction with the approval of a majority of the disinterested members of
our board of managers or following receipt of a written fairness opinion from a
nationally recognized investment banking firm stating that the transaction is
fair to us from a financial point of view. Such restrictions could have an
adverse effect on us by limiting our ability to engage in transactions with
Investor, Investor Holdings and its subsidiaries, which could potentially impact
any synergies we realize from the Fitzgeralds acquisition.

                                       28

<PAGE>

Any failure by the Joint Venture Partner to fund operations or make lease
payment, or any significant conflicts between us and our Joint Venture Partner
could have an adverse effect on the operations of the Buffington Harbor Gaming
Complex, which would adversely affect our business

     In 1995, we formed the BHR Joint Venture with the Joint Venture Partner to
develop and operate the dockside pavilion and common areas of the Buffington
Harbor Gaming Complex. Efficient operation of the BHR Joint Venture to support
our casino will depend upon our continuing ability, as well as that of our Joint
Venture Partner, to fund day-to-day operations and agree on related business
matters. In addition, the Joint Venture Partner is required to make lease
payments related to the parking facility and we receive a 50% credit towards our
lease obligations. Any failure by the Joint Venture Partner to fund operations
of the BHR Joint Venture when required or make the lease payments related to the
parking facility (including its obligations under the BHPA lease), or any
significant conflict in this relationship that is not promptly resolved, would
adversely affect the operations of the gaming complex. A significant disruption
in the business of the gaming complex is likely to adversely affect the
operations of the Majestic Star Casino and our ability to generate revenues.

Many factors affecting the labor pool in Indiana could increase our labor costs

     We are dependent upon the available labor pool of unskilled and
semi-skilled employees. We are also subject to the Fair Labor Standards act,
which governs such matters as minimum wage, overtime and other working
conditions. In addition, our agreement with the City of Gary, Indiana, requires
us to use our best efforts to have an employee base comprised of 70% racial
minorities, 52% females, 67% residents of the City of Gary and 90% residents of
Lake County, Indiana. A shortage in the labor pool, especially in the City of
Gary and in Lake County, or other general inflationary pressures or changes in
applicable state or federal minimum wage or other labor laws, could result in
increased labor costs to us.

We are subject to potential exposure to environmental liabilities

     The Buffington Harbor Gaming Complex is located on a site where prior
industrial operations and activities may have resulted in contamination of the
environment. As the owner and operator of the Majestic Star Casino and a member
of the BHR Joint Venture, we could be held responsible for the costs of
addressing any contamination. Our liability under applicable environmental laws
may be imposed without regard to whether we knew of, or were responsible for,
the presence of hazardous substances and, in some cases, may not be limited to
the value of the affected property. There can be no assurance that further
development of the facility, including the proposed new parking facility, or of
a new harbor, and the related construction, will not identify environmental
contamination. If this were to occur, the costs of remediation or the disruption
to our business could adversely affect our operations and may also adversely
affect our ability to sell, lease or operate the property or to borrow against
it. Neither we nor the BHR Joint Venture is entitled to indemnification from any
prior owners or operators of the site with respect to environmental matters.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The Company does not have any financial instruments held for traditional
purposes, such as trading or other speculative purposes, and does not hedge any
of its market risks with derivative instruments.

     The Company's primary market risk exposure relates to interest risk
exposure through its borrowings and third-party financing, including the
Majestic Star Credit Facility, under which any interest accrues on a floating
rate basis. These sources of credit, along with cash flow from operations, are
used to maintain liquidity and fund business operations. The Company typically
replaces borrowings under its third-party vendor financing, as necessary, with
shorter termed variable rate financing generally secured by the assets being
acquired. The nature and amount of the Company's debt may vary as a result of
future business requirements, market conditions and other factors.

                                       29

<PAGE>

     The Majestic Star Credit Facility has a maximum credit line of $20.0
million. Assuming we have borrowed against the maximum available under the
Majestic Star Credit Facility, a one-half percentage point change in the
underlying variable rate would result in a change in related interest expense of
$100,000. Additionally, should we assume variable rate debt in the future, we
will be subject to market risk, which is the risk of loss from changes in market
prices and interest rates.

     At April 1, 2002, Majestic Star had no outstanding borrowings under its
credit facility.

     In addition, we have approximately $130.0 million principal amount of notes
outstanding under the Majestic Star Indenture. Our fixed rate debt instruments
are not generally affected by a change in the market rates of interest and
therefore, such instruments generally do not have an impact on future earnings.
However, as our fixed rate debt matures, future earnings and cash flows may be
impacted by changes in interest rates related to debt incurred to fund
repayments under maturing facilities.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See Item 14(a) of this Report on Form 10-K.

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

     Not Applicable.

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT

     The following table sets forth certain information with respect to the
executive officers of the Company as of December 31, 2001. The Company does not
have directors since it is a limited liability company.

      Name and Age                                      Position(s) Held
      ------------                                      ----------------
Don H. Barden, 58            Chairman, President and Chief Executive Officer

Michael E. Kelly, 40         Executive Vice President, Chief Operating and
                             Financial Officer and Secretary

     Don H. Barden, is the Chairman, President and Chief Executive Officer of
the Company and, since November 16, 1993, Chairman and President of BDI, with
responsibility for key policy making functions. Since their formations, Mr.
Barden is also President and Chief Executive Officer of Investor and Manager of
Investor Holdings; Barden Colorado Gaming, LLC and Barden Mississippi Gaming
LLC; Chairman, President and Chief Executive Officer of Investor Holdings,
Majestic Investor Capital Corp. ("Investor Capital"), Barden Colorado Gaming,
LLC, Barden Mississippi Gaming, LLC and Barden Nevada Gaming, LLC. Mr. Barden
also has served as a director of Investor Capital since its formation.
Additionally, he is the President and Chief Executive Officer of a group of
other companies he owns and/or operates. Over the past 30 years, Mr. Barden has
successfully developed, owned and operated many business enterprises in various
industries including real estate development, casino gaming, broadcasting, cable
television and international trade.

     Michael E. Kelly, is the Executive Vice President, Chief Operating and
Financial Officer and Secretary of the Company since January 1, 1999, with
overall responsibility for the daily operations. From April 1996 through
December 31, 1998, Mr. Kelly was the Vice President and Chief Financial Officer
of the Company with overall responsibility for the Company's financial reporting
and investor relations functions. Mr. Kelly assumed the responsibility for
management of daily operations and related activities of the Company effective
October 17, 1998. From October 1998 through October 2001, Mr. Kelly also served
as the Company's General Manager. Mr. Kelly is a Vice President of BDI since
April 1996 and director of Majestic Investor Capital Corp. since its formation.
Since their formation, Mr. Kelly is also Executive Vice President, Chief
Operating and Financial Officer of Investor; Manager of Investor Holdings, and
Barden Mississippi Gaming, LLC; Executive Vice President, Chief Operating and
Financial Officer and Secretary of

                                       30

<PAGE>

Investor Holdings, Investor Capital, Barden Colorado Gaming, LLC, Barden
Mississippi Gaming, LLC and Barden Nevada Gaming, LLC; Director of Majestic
Investor Capital Corp. From June 1994 to April 1996, Mr. Kelly held various
positions with Fitzgeralds Gaming Corporation, including Vice President of
Finance. Mr. Kelly also was the Senior Director of Operations and Chief
Financial Officer of Fitzgeralds Tunica from July 1994 to November 1995. From
September 1991 to June 1994, Mr. Kelly was Vice President and Chief Financial
Officer of Empress River Casino Corporation and its affiliates. From 1982 to
1991, Mr. Kelly was employed in various senior finance and administrative
functions by Harrah's Hotel & Casino in New Jersey and Nevada and by the
Fitzgeralds Group in Reno and Las Vegas, Nevada.

ITEM 11.  EXECUTIVE COMPENSATION

     The following table sets forth all compensation earned for services
performed for the Company during the three fiscal years ended December 31, 2001
by the Company's Chief Executive Officer and each of its other executive
officers (collectively, the "Named Executive Officers").

SUMMARY COMPENSATION TABLE

     The following table sets forth all compensation earned for services
performed for the Company, Investor and, following its formation in September of
2001, Investor Holdings, and each of its subsidiaries, during the years shown
below by our Chief Executive Officer and our other executive officer. All
compensation is paid by the Company.

<TABLE>
<CAPTION>
                                                                             Annual
                                                                          Compensation(1)                   All Other
         Name and Position                                    Year            Salary         Bonus        Compensation(2)
         -----------------                                    ----            ------         -----        ---------------
<S>                                                           <C>         <C>              <C>            <C>
         Don H. Barden (3)                                    2001           $332,788      $     --             $ 1,271
             Chairman, President and Chief                    2000            331,250            --                 920
             Executive Officer                                1999            289,000            --               1,139

         Michael E. Kelly (3)                                 2001           $296,635      $175,000             $24,901
             Executive Vice President, Chief                  2000            280,000       100,000              18,589
             Operating and Financial Officer                  1999            275,000        70,000              14,919
             and Secretary
</TABLE>

__________________
(1)  The incremental cost to the Company of providing perquisites and other
     personal benefits did not exceed, as to any "Named Executive Officer," the
     lesser of $50,000 or 10% of the total salary and bonus paid to such
     executive officer for any such year and, accordingly, is omitted from the
     table.

(2)  Amounts represent contractual payments under individual employment
     agreements. In 2001, the Company contributed a 401(k) match of $17,530 to
     Mr. Kelly, and Mr. Kelly was also reimbursed by the Company $4,647 for
     non-deductible medical plan expenditures. In 2001, life insurance premiums
     of $1,271 and $2,724 were paid by the Company on behalf of Messrs. Barden
     and Kelly, respectively. In 2000, the Company contributed a 401(k) match of
     $11,520 to Mr. Kelly, and Mr. Kelly was also reimbursed by the Company
     $5,045 for non-deductible medical plan expenditures. In 2000, life
     insurance premiums of $920 and $2,024 were paid by the Company on behalf of
     Messrs. Barden and Kelly, respectively. In 1999, the Company contributed a
     401(k) match of $7,601 to Mr. Kelly, and Mr. Kelly was also reimbursed
     $4,904 for non-deductible medical plan expenditures. In 1999, life
     insurance premiums of $1,139 and $2,414 were paid on behalf of Messrs.
     Barden and Kelly, respectively.

                                       31

<PAGE>

(3)  All of Mr. Barden's and Mr. Kelly's compensation is paid by the Company,
     but a portion of such compensation is reimbursed by Investor Holdings
     through an expense sharing agreement. See Item 13 - "Certain Relationships
     and Related Transactions."

Employment Agreements

     Mr. Barden serves as our Chairman, President and Chief Executive Officer
and currently receives annual compensation of $370,000 as an employee, pursuant
to a letter agreement dated October 22, 2001 with the Company.

     Mr. Kelly serves as our Executive Vice President, Chief Operating and
Financial Officer and Secretary pursuant to a three-year employment agreement
with the Company dated October 22, 2001. Under this agreement, Mr. Kelly will
receive base compensation of $400,000 per year and can also earn annual
incentive compensation based upon his performance and the consolidated Company's
performance. In addition to such compensation, Mr. Kelly is entitled to term
life insurance in an amount equal to $2.5 million and other customary employee
benefits, including participation in the Company's 401(k) plan, together with a
$100,000 signing bonus and an interest-free loan in the amount of $200,000 to be
repaid in three equal annual installments. Mr. Kelly is also entitled to
additional compensation, upon a change in control, equal to his base salary and
incentive compensation for the remainder of the term of the agreement, plus 12
months thereafter. Mr. Kelly's employment agreement contains certain
non-competition provisions with a duration of 12 months following termination of
his employment.

Compensation Committee Interlocks and Insider Participation

     The Company has no standing Compensation Committee. All compensation
decisions are made by BDI, the sole manager of the Company.

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

     The Company is indirectly wholly-owned by Don H. Barden, its Chairman,
President and Chief Executive Officer.

     The following table sets forth certain information, as of April 1, 2002,
with regard to the beneficial ownership of the membership interests in the
Company.

             Name and Address of Beneficial Owner                 % Ownership
             ------------------------------------                 -----------

             Don H. Barden                                            100.0% (1)
             163 Madison Avenue, Suite 2000
             Detroit, Michigan 48226

(1)  Includes the membership interests in the Company beneficially owned
directly by BDI.  Mr. Barden is the beneficial owner of 100% of BDI.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Loans to Related Parties

     Interest of $185,750 remains outstanding at December 31, 2001 on a $2.0
million note made by Investor to BDI. The note was later assigned to Investor
Holdings from Investor. BDI paid the principal of the note in conjunction with
the closing of the Fitzgeralds acquisition on December 6, 2001.

                                       32

<PAGE>

     During 2001, Investor made a $700,000 loan to BDI and the Company made a
$300,000 employee loan to Mr. Barden. These loans accrue interest at 7% per
annum and are due on December 12, 2002.

Management Agreement

     A Management Agreement was entered into on June 18, 1999 with BDI to
provide for, among other things, a management fee payable by the Company to BDI
for acting as our manager. The fees for each fiscal quarter will be equal to 5%
of the Company's Consolidated Cash Flow (as defined in the Indenture for the
Majestic Star Senior Secured Notes) for the immediately preceding fiscal quarter
and may not be paid if the Company is in default under the Majestic Star
Indenture or if the Company does not meet certain financial ratios as provided
in such Indenture. For the three month periods ending September 30, 1999,
December 31, 1999 and March 31, 2000, approximately $325,000, $282,000, and
$315,000, respectively, was paid to BDI in accordance with the Management
Agreement. No management fees were paid for the period April 1, 2000 through
September 30, 2001 since the Company has not met certain financial ratios as
provided in the Majestic Star Indenture. For the three months ended December 31,
2001, approximately $280,000 was paid to BDI in accordance with the Management
Agreement.

Expense Sharing Agreement

     Pursuant to an expense sharing agreement entered into on October 22, 2001,
Investor Holdings will reimburse the Company for sixty percent (60%) of (i) the
costs and expenses of executives and certain other employees, including, but not
limited to, salaries, bonuses, benefit payments, insurance and supplies, (ii)
rent and (iii) other similar costs and expenses paid by the Company. These
executives and employees will provide services to both the Company and to
Investor Holdings and its subsidiaries. Currently, due to restrictions set forth
in the Investor Holdings Indenture, the reimbursement percentage is capped at
fifty percent (50%) up to an aggregate of $1.7 million.

Naming Rights Agreement

     GNC intends to develop an outdoor amphitheater on property it owns adjacent
to the Company's riverboat gaming facility. The Company entered into a Naming
Rights Agreement with GNC effective as of October 31, 2001. Pursuant to the
Naming Rights Agreement, GNC agreed to use the name "The Majestic Star
Amphitheater" as the name of the amphitheater and the Company paid GNC $1.5
million during 2001 for such rights. The initial term of the Naming Rights
Agreement is three years commencing on the opening of the amphitheater.

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)      1.  Financial Statements as listed on Page F-1.

         2.  Financial Statement Schedule as listed on Page F-1.

         3.  Exhibits:  The exhibits included as part of this report are listed
             in the attached Exhibit Index on Page E-1, which is incorporated
             herein by reference.

(b)      Reports on Form 8-K:

The Company filed a Form 8-K on December 13, 2001 reporting consummation of the
acquisition of the Fitzgeralds assets.

                                       33

<PAGE>

                          INDEX OF FINANCIAL STATEMENTS

<TABLE>
<S>                                                                                                   <C>
THE MAJESTIC STAR CASINO, LLC

     Report of Independent Accountants                                                                 F-2

     Consolidated Balance Sheets as of December 31, 2001 and 2000                                      F-3

     Consolidated Statements of Income for the years ended December 31, 2001,
         2000 and 1999                                                                                 F-4

     Consolidated Statements of Changes in Members' Deficit for the years ended
         December 31, 2001, 2000 and 1999                                                              F-5

     Consolidated Statements of Cash Flows for the  years ended December 31, 2001,
         2000, and 1999                                                                                F-6

     Notes to the Consolidated Financial Statements                                                    F-7

     Schedule:

         Schedule II - Valuation and Qualifying Accounts                                              F-35
</TABLE>

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

               INDEX TO HISTORICAL COMBINED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                              PAGE
                                                              ----
<S>                                                           <C>
INDEPENDENT AUDITORS' REPORT................................  F-36
COMBINED FINANCIAL STATEMENTS:
  Balance Sheets at December 31, 2000 and at December 6,
     2001...................................................  F-37
  Statements of Operations for the Years Ended December 31,
     1999 and 2000, and for the Period ended December 6,
     2001...................................................  F-38
  Statements of Stockholder's Deficiency for the Years Ended
     December 31, 1999 and 2000, and for the Period ended
     December 6, 2001.......................................  F-39
  Statements of Cash Flows for the Years Ended December 31,
     1999 and 2000, and for the Period ended December 6,
     2001...................................................  F-40
  Notes to Combined Financial Statements....................  F-42

SUPPLEMENTAL COMBINING SCHEDULES:
  Statement of Operations Information for the Year Ended
     December 31, 1999......................................  F-57
  Statement of Cash Flows Information for the Year Ended
     December 31, 1999......................................  F-58
  Balance Sheet Information at December 31, 2000............  F-59
  Statement of Operations Information for the Year Ended
     December 31, 2000......................................  F-60
  Statement of Cash Flows Information for the Year Ended
     December 31, 2000......................................  F-61
  Balance Sheet Information at December 6, 2001.............  F-63
  Statement of Operations Information for the Period from
     January 1, 2001 through December 6, 2001...............  F-64
  Statement of Cash Flows Information for the Period from
     January 1, 2001 through December 6, 2001...............  F-65
SCHEDULE II - COMBINED VALUATION AND QUALIFYING ACCOUNTS....  F-66
</TABLE>

<TABLE>
<S>                                                                                                   <C>
Financial Statements of Buffington Harbor Riverboats, L.L.C.:

     Balance Sheets at December 31, 2001 and 2000                                                     F-68

     Statements of Operations for the years ended December 31, 2001, 2000 and 1999                    F-69

     Statements of Members' Capital for the years ended December 31, 2001, 2000
         and 1999                                                                                     F-70

     Statements of Cash Flows for the years ended December 31, 2001, 2000 and 1999                    F-71

     Notes to the Financial Statements                                                                F-72
</TABLE>

                                       F-1
<PAGE>
                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Members of
The Majestic Star Casino, LLC:

     In our opinion, the financial statements listed in the index appearing
under Item 14(a)1 on page F-1 present fairly, in all material respects, the
financial position of The Majestic Star Casino, LLC and its subsidiaries at
December 31, 2001 and 2000, and the results of their operations and their cash
flows for each of the three years in the period ended December 31, 2001, in
conformity with accounting principles generally accepted in the United States of
America. In addition, in our opinion, the financial statement schedule listed in
the index appearing under Item 14(a)(2) on page F-1 presents fairly in all
material respects, the information set forth therein when read in conjunction
with the related consolidated financial statements. These financial statements
and financial statement schedule are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements and financial statement schedule based on our audits. We conducted
our audits of these statements in accordance with auditing standards generally
accepted in the United States of America which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.


PricewaterhouseCoopers LLP


Chicago, Illinois
April 8, 2002

                                      F-2
<PAGE>

                          THE MAJESTIC STAR CASINO, LLC
          CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2001 AND 2000

<TABLE>
<CAPTION>

                                                                                         2001                     2000
-------------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>                      <C>
ASSETS
Current Assets:
  Cash and cash equivalents ............................................           $  25,925,291            $  16,119,512
  Accounts receivable, less allowance for doubtful accounts
     of $359,702 and $120,000, respectively ............................               3,079,523                2,059,577
  Inventories ..........................................................                 995,708                   53,479
  Prepaid expenses .....................................................               2,190,255                  636,337
  Note due from affiliate ..............................................                 700,000                2,000,000
  Due from Buffington Harbor Riverboats, L.L.C .........................                 333,838                        -
  Restricted cash ......................................................                       -                2,000,000
                                                                                   -------------            -------------
     Total current assets ..............................................              33,224,615               22,868,905
                                                                                   -------------            -------------

Property, equipment, and vessel improvements, net ......................             170,195,013               49,158,571

Intangible assets (net) ................................................              19,290,753                        -

Other Assets:
  Deferred financing costs, less accumulated amortization
     of $2,202,831 and $1,269,380, respectively ........................              10,530,426                5,840,448
  Deferred costs, net of accumulated amortization
     of $-0- and $5,099,462, respectively ..............................                       -                  552,553
  Investment in Buffington Harbor Riverboats, L.L.C ....................              33,898,771               43,924,033
  Goodwill .............................................................              10,602,250                        -
  Restricted cash ......................................................               1,000,000                        -
  Other assets, prepaid leases and deposits ............................              12,317,704                4,252,799
                                                                                   -------------            -------------
          Total other assets ...........................................              68,349,151               54,569,833
                                                                                   -------------            -------------

          Total Assets .................................................           $ 291,059,532            $ 126,597,309
                                                                                   =============            =============

LIABILITIES AND MEMBERS' DEFICIT
Current Liabilities:
  Current maturities of long-term debt .................................           $   6,656,574            $   8,811,719
  Accounts payable .....................................................               2,978,502                  789,293
  Accrued payroll and related ..........................................               6,194,601                1,108,066
  Accrued interest .....................................................               8,294,312                7,107,058
  Other accrued liabilities ............................................              13,020,097                3,597,924
  Due to Buffington Harbor Riverboats, L.L.C ...........................                       -                  380,736
                                                                                   -------------            -------------
          Total current liabilities ....................................              37,144,086               21,794,796

Long-term debt, net of current maturities ..............................             273,896,933              128,233,486
                                                                                   -------------            -------------

          Total Liabilities ............................................             311,041,019              150,028,282
                                                                                   -------------            -------------

Commitments and contingencies

Members' Deficit:
  Members' contributions ...............................................              29,000,000               24,000,000
  Accumulated deficit ..................................................             (48,981,487)             (47,430,973)
                                                                                   -------------            -------------
          Total Members' Deficit .......................................             (19,981,487)             (23,430,973)
                                                                                   -------------            -------------

          Total Liabilities and Members' Deficit .......................           $ 291,059,532            $ 126,597,309
                                                                                   =============            =============
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-3

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC
                        CONSOLIDATED STATEMENTS OF INCOME

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

<TABLE>
<CAPTION>
                                                     For the Year Ended   For the Year Ended   For the Year Ended
                                                     December 31, 2001    December 31, 2000    December 31, 1999
  ---------------------------------------------------------------------------------------------------------------
<S>                                                  <C>                  <C>                  <C>
   Revenues:
    Casino ............................................  $132,553,506        $115,455,271        $117,267,702
    Rooms .............................................     1,079,456
    Food and beverage .................................     3,318,575           1,925,023           1,948,927
    Other .............................................     1,415,692           1,070,965             960,431
                                                         ------------        ------------        ------------
                                                          138,367,229         118,451,259         120,177,060

        Less promotional allowances ...................    (8,774,349)         (5,017,777)         (3,005,433)
                                                         ------------        ------------        ------------

        Net revenues ..................................   129,592,880         113,433,482         117,171,627
                                                         ------------        ------------        ------------

   Costs and expenses:
    Casino ............................................    25,517,276          21,179,612          19,442,984
    Rooms .............................................       628,910                   -                   -
    Food and beverage .................................     3,027,514           2,402,518           2,342,445
    Other .............................................       108,732                   -                   -
    Gaming taxes ......................................    34,834,624          32,350,368          32,899,551
    Advertising and promotion .........................     7,829,759           8,019,655           6,816,067
    General and administrative ........................    26,933,763          25,799,848          24,737,833
    Economic incentive - City of Gary .................     3,667,100           3,230,679           3,626,056
    Depreciation and amortization .....................     8,990,616           9,113,681           8,375,223
    Pre-opening expenses ..............................     1,018,234                   -                   -
    Loss on disposal of assets ........................        12,114             416,904                   -
                                                         ------------        ------------        ------------
                                                          112,568,642         102,513,265          98,240,159
                                                         ------------        ------------        ------------

        Operating income ..............................    17,024,238          10,920,217          18,931,468
                                                         ------------        ------------        ------------

   Other income (expense):
    Loss on investment in
        Buffington Harbor Riverboats, L.L.C. ..........    (2,797,740)         (2,058,669)         (2,848,004)
    Interest income ...................................       399,752             893,453           1,058,213
    Interest expense ..................................   (16,028,074)        (14,998,377)        (15,496,091)
    Interest expense to affiliate .....................             -                   -            (167,455)
    Other non-operating expense .......................      (148,690)           (124,503)                  -
                                                         ------------        ------------        ------------
                                                          (18,574,752)        (16,288,096)        (17,453,337)
                                                         ------------        ------------        ------------

        Income (loss) before extraordinary item .......    (1,550,514)         (5,367,879)          1,478,131

   Extraordinary Item:
     Loss on bond redemption ..........................             -            (382,500)        (15,238,156)
                                                         ------------        ------------        ------------

        Net loss ......................................  $ (1,550,514)       $ (5,750,379)       $(13,760,025)
                                                         ============        ============        ============
</TABLE>


  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-4

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC
             CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS' DEFICIT

For the Years Ended December 31, 2001, December 31, 2000, and December 31, 1999

<TABLE>
<CAPTION>
                                  Capital       Accumulated          Total
                               Contributions      Deficit      Members' Deficit
                               -------------   ------------    -----------------
<S>                            <C>             <C>             <C>
Balance, December 31, 1998      $24,000,000    $(26,997,824)     $ (2,997,824)
Net loss                                  -     (13,760,025)      (13,760,025)
Cash distribution to Members              -        (325,135)         (325,135)
                               ------------    ------------      ------------


Balance, December 31, 1999       24,000,000     (41,082,984)      (17,082,984)
Net loss                                  -      (5,750,379)       (5,750,379)
Cash distribution to Members              -        (597,610)         (597,610)
                               ------------    ------------      ------------


Balance, December 31, 2000       24,000,000     (47,430,973)      (23,430,973)
Member's contribution             5,000,000               -         5,000,000
Net loss                                  -      (1,550,514)       (1,550,514)
                               ------------    ------------      ------------


Balance, December 31, 2001      $29,000,000    $(48,981,487)     $(19,981,487)
                               ============    ============      ============
</TABLE>



  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-5
<PAGE>
                          THE MAJESTIC STAR CASINO, LLC
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

<TABLE>
<CAPTION>
                                                                        For the Year Ended   For the Year Ended  For the Year Ended
                                                                        December 31, 2001    December 31, 2000   December 31, 1999
                                                                        -----------------    -----------------   -----------------
<S>                                                                     <C>                  <C>                 <C>
Cash Flows From Operating Activities:
Net loss ............................................................      $  (1,550,514)      $  (5,750,379)      $ (13,760,025)
Adjustments to reconcile net loss to net cash provided by
    operating activities:
Depreciation ........................................................          6,987,173           6,835,778           6,322,363
Amortization ........................................................          2,003,444           2,277,903           2,052,860
Loss on investment in Buffington Harbor Riverboats, L.L.C ...........          2,797,740           2,058,669           2,848,004
Loss on disposal of assets ..........................................             12,114             416,904                   -
Loss on bond redemption .............................................                  -             382,500          15,238,156
(Increase) in accounts receivable, net ..............................           (440,012)            (65,416)         (1,145,818)
(Increase) decrease in inventories ..................................             36,221              13,570             (25,101)
(Increase) decrease in prepaid expenses .............................           (539,246)            405,411             (57,236)
(Increase)  in other assets .........................................           (470,733)         (1,738,980)         (3,224,105)
Increase (decrease) in accounts payable .............................            637,465             (69,794)            431,017
Increase (decrease) in accrued payroll and other expenses ...........            203,763             171,458            (137,193)
Increase (decrease) in accrued interest .............................          1,187,254            (796,202)          3,686,838
Increase (decrease) in other accrued liabilities ....................          1,546,616             605,290             (77,899)
                                                                           -------------       -------------       -------------
   Net cash provided by operating activities ........................         12,411,285           4,746,712          12,151,861
                                                                           -------------       -------------       -------------

Cash Flows From Investing Activities:
Payment for purchase of Fitzgeralds, net of cash received ...........       (143,758,152)                  -                   -
Acquisition of property, equipment and vessel improvements ..........         (5,089,848)         (3,039,635)         (3,919,960)
(Increase) decrease in prepaid lease and deposits ...................          2,287,437             (98,404)            (15,000)
Proceeds from sale of equipment .....................................              1,850             179,200                   -
Investment in Buffington Harbor Riverboats, LLC .....................           (214,665)         (7,836,489)           (245,330)
Purchase of naming rights ...........................................         (1,500,000)                  -                   -
(Increase) decrease in restricted cash ..............................          2,000,000          (2,000,000)                  -
Purchase of 49% interest in Gary New Century ........................                  -          (9,000,000)                  -
Sale of 49% interest in Gary New Century ............................                  -           9,000,000                   -
Cash paid for other investing activities ............................                  -                   -            (100,000)
                                                                           -------------       -------------       -------------
   Net cash used in investing activities ............................       (146,273,378)        (12,795,328)         (4,280,290)
                                                                           -------------       -------------       -------------

Cash Flows From Financing Activities:
Redemption of 12-3/4% Senior Secured Notes ..........................                  -          (6,382,500)       (116,005,298)
Proceeds from issuance of 10-7/8% Senior Secured Notes ..............                  -                   -         127,738,000
Proceeds from issuance of 11.653% Senior Secured Notes ..............        145,000,400                   -                   -
Payment of Senior Secured Notes issuance costs ......................         (5,349,230)                  -          (4,241,526)
Member's equity contribution ........................................          5,000,000                   -                   -
(Increase) decrease in restricted cash ..............................                  -           7,357,874          (7,357,874)
Line of credit, net .................................................         (1,300,000)          7,800,000                   -
Increase in short-term debt .........................................                  -                   -           6,000,000
Increase in long-term debt ..........................................                  -                   -              75,226
Cash paid to reduce long-term debt ..................................           (983,298)         (2,154,680)         (2,145,966)
Cash received from loans from Barden Development, Inc ...............          2,000,000           4,000,000                   -
Payment of loan to member ...........................................                  -                   -          (8,759,355)
Issuance of loans to Barden Development, Inc ........................           (700,000)         (6,000,000)                  -
Distribution to Barden Development, Inc. ............................                  -            (597,610)           (325,135)
                                                                           -------------       -------------       -------------
   Net cash provided (used) by financing activities .................        143,667,872           4,023,084          (5,021,928)
                                                                           -------------       -------------       -------------

Net increase (decrease) in cash and cash equivalents ................          9,805,779          (4,025,532)          2,849,643
Cash and cash equivalents, beginning of year ........................         16,119,512          20,145,044          17,295,401
                                                                           -------------       -------------       -------------
Cash and cash equivalents, end of year ..............................      $  25,925,291       $  16,119,512       $  20,145,044
                                                                           =============       =============       =============

NONCASH INVESTING ACTIVITIES:

Conversion of Investment in Buffington Harbor Riverboats, LLC
   to prepaid lease .................................................      $   6,213,615       $          -        $           -

Interest paid:
Principal Member ....................................................      $           -       $           -       $     266,508
Equipment Debt ......................................................             35,898             237,513             487,926
Senior Secured Notes-Fixed Interest, 10.875% ........................         14,137,500          14,648,021                   -
Senior Secured Notes-Fixed Interest, 12.75% .........................                  -             382,500           8,233,313
Senior Secured Notes-Contingent Interest, 12.75% ....................                  -             250,545           3,018,090
Line of credit ......................................................            423,831             276,000                   -
Indiana Department of Revenue .......................................            260,374                   -                   -
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-6

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Basis of Presentation:

     The Majestic Star Casino, LLC (the "Company") was formed on December 8,
1993, as an Indiana limited liability company ("LLC"), to provide gaming and
related entertainment to the public. The Company commenced gaming operations in
the City of Gary (the "City") at Buffington Harbor, located in Lake County, in
the State of Indiana on June 7, 1996. Majestic Investor, LLC was formed in
September 2000 as an "unrestricted subsidiary" of the Company under the
Indenture relating to the Company's 10-7/8% Senior Secured Notes. Majestic
Investor, LLC was initially formed to satisfy the Company's off-site development
obligations under the Development Agreement with the City of Gary.

     Majestic Investor, LLC entered into a definitive purchase and sale
agreement dated as of November 22, 2000, as amended December 4, 2000, with
Fitzgeralds Gaming Corporation and certain of its affiliates (the "Seller") to
purchase substantially all of the assets of three of its subsidiaries for
approximately $149.0 million in cash, subject to adjustment in certain
circumstances, plus assumption of certain liabilities. Majestic Investor, LLC
assigned all of its rights and obligations to Majestic Investor Holdings, LLC, a
wholly-owned subsidiary of Majestic Investor, LLC, following the formation of
Majestic Investor Holdings, LLC. Majestic Investor Holdings, LLC completed the
purchase of the Fitzgeralds assets on December 6, 2001. The three Fitzgeralds
brand casinos are "restricted subsidiaries" of Majestic Investor Holdings, LLC
under the Indenture relating to Majestic Investor Holdings, LLC's 11.653% Senior
Secured Notes and "unrestricted subsidiaries" under the Company's Indenture
relating to the Company's 10-7/8% Senior Secured Notes.

     Except where otherwise noted, the words "we," "us," "our," and similar
terms, as well as the "Company," refer to The Majestic Star Casino, LLC and all
of its subsidiaries.

     The accompanying consolidated financial statements include the accounts of
The Majestic Star Casino, LLC and its wholly-owned subsidiary, Majestic
Investor, LLC. Intercompany transactions are eliminated. Investment in
affiliates in which the Company has the ability to exercise significant
influence, but not control, are accounted for by the equity method.

2.  Summary of Significant Accounting Policies:

PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries. All intercompany
balances and transactions have been eliminated in the consolidation.

CASH AND CASH EQUIVALENTS - The Company considers cash equivalents to include
short-term investments with original maturities of ninety days or less. Cash
equivalents are carried at cost plus accrued interest which approximates fair
value. The Company places its cash primarily in checking and money market
accounts with high credit quality financial institutions which, at times, have
exceeded federally insured limits.

                                      F-7

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

2.  Summary of Significant Accounting Policies   (Continued)

RESTRICTED CASH - At December 31, 2001, restricted cash represents U.S. Treasury
Notes held in an escrow account for the benefit of certain owners of land leased
to Barden Nevada Gaming, LLC.

CONCENTRATION OF CREDIT RISK - Financial instruments that potentially subject
the Company to concentrations of credit risk consist principally of casino
accounts receivable. The Company extends credit to approved casino customers
following background checks and investigations of creditworthiness. An estimated
allowance for doubtful accounts is maintained to reduce the Company's
receivables to their carrying amount, which approximates fair value. Management
believes that as of December 31, 2001, no significant concentrations of credit
risk existed for which an allowance had not already been determined and
recorded.

INVENTORIES - Inventories consisting principally of food, beverage, operating
supplies and gift shop items are stated at the lower of cost or market value.
Cost is determined by the first-in, first-out method.

OTHER ASSETS - The estimated cost of normal operating quantities (base stock) of
china, silverware, glassware, linen, uniforms and utensils has been recorded as
an asset and is not being depreciated. Costs of base stock replacements are
expensed as incurred. Other assets in the accompanying consolidated balance
sheets includes $1,243,910 and $539,392 of base stock inventories at December
31, 2001 and 2000, respectively.

PROPERTY AND EQUIPMENT - Property and equipment are stated at cost. Depreciation
expense is computed utilizing the straight-line method over the estimated useful
lives of the depreciable assets. Certain equipment held under capital leases are
classified as property and equipment and amortized using the straight-line
method over the lease terms and the related obligations are recorded as
liabilities. Costs of major improvements are capitalized; costs of normal
repairs and maintenance are charged to expense as incurred. Gains or losses on
dispositions of property and equipment are recognized in the consolidated
statement of income when incurred.

CAPITALIZED INTEREST - The Company capitalizes interest costs associated with
debt incurred in connection with major construction projects. When no debt is
specifically identified as being incurred in connection with such construction
projects, the Company capitalizes interest on amounts expended on the project at
the Company's average cost of borrowed money.

DEFERRED FINANCING COSTS - Deferred financing costs represent agent's
commissions, closing costs and professional fees incurred in connection with the
issuance of the Company's 10 7/8% Senior Secured Notes and $20.0 million line of
credit, and Majestic Investor Holdings, LLC's 11.653% Senior Secured Notes and
the $15.0 million line of credit. Such costs are being amortized over the terms
of the related notes and lines of credit, respectively, using the effective
interest method.

                                      F-8

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

2.  Summary of Significant Accounting Policies   (Continued)

DEFERRED COSTS - Development and obligation payments to the City and licensing
costs represent direct costs associated with the development of the riverboat
casino, and were deferred until operations commenced on June 7, 1996. These
costs have been amortized over five years, the life of the gaming license.

GOODWILL - Goodwill represents the cost of net assets acquired in excess of
their fair value. Goodwill for acquisitions after June 30, 2001 is not subject
to amortization but is subject to impairment testing at least annually.

INTANGIBLE ASSETS - Intangible assets are amortized over their estimated useful
lives, generally eight to ten years.

INVESTMENT IN BUFFINGTON HARBOR RIVERBOATS, L.L.C. - The Company accounts for
its 50 percent interest in Buffington Harbor Riverboats, L.L.C. ("BHR") under
the equity method, whereby the initial investments are recorded at cost and then
adjusted for the Company's share of BHR's net income or loss.

REVENUE RECOGNITION - Casino revenue is the net win from gaming activities,
which is the difference between gaming wins and losses. The majority of our
casino revenue is counted in the form of cash, chips and tokens and therefore
is not subject to any significant or complex estimation procedures. Room, food
and beverage and other revenues are recognized at the time the related service
is performed.

PROMOTIONAL ALLOWANCES - The Company provides cash-back incentives to patrons
who earn a percentage of their cash wagered when the patron uses their slot card
provided by the casino. The patrons receive checks or coupons that can be
redeemed for cash with varying expiration terms. The percentage of cash earned
varied depending upon competitive conditions. Approximately $7,813,635,
$4,607,090, and $2,674,947 of cash-back components of the Company's Slot Club
reward programs, including promotional coupons, have been classified as a
reduction of revenue in the accompanying consolidated statement of income as
promotional allowances in the determination of net revenues for the years ended
December 31, 2001, 2000 and 1999, respectively. In addition, operating revenues
include the retail value of hotel rooms, food and beverage and other services,
which were provided to customers without charge. The corresponding charges have
been deducted from revenue in the accompanying consolidated statements of income
as promotional allowances in the determination of net revenues. The estimated
direct cost of providing promotional allowances has been included in costs and
expenses as follows:

<TABLE>
<CAPTION>
                                                                     Year Ended December 31,
                                                                     -----------------------
                                                           2001             2000               1999
                                                           ----             ----               ----

<S>                                                    <C>               <C>              <C>
         Hotel                                         $   254,918       $         -      $         -
         Food and beverage                               1,008,421           179,782          191,879
         Other                                             231,933           105,391           55,062
</TABLE>

PRE-OPENING EXPENSES - Pre-opening expenses are expensed as incurred.

                                      F-9

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

2.  Summary of Significant Accounting Policies   (Continued)

FEDERAL INCOME TAXES - The Company has historically been treated as a
partnership for U.S. federal income tax purposes. As a result of a change in the
Company's ownership structure in June 2001, the Company ceased to be a
partnership for U.S. federal income tax purposes, and is now an entity
disregarded for U.S. federal income tax purposes. At all times during 2001,
income of the Company was taxed directly to its owner, and, accordingly, no
provision for federal income taxes is reflected in the financial statements.

ADVERTISING COSTS - Advertising expenditures are expensed as incurred.
Advertising costs included in advertising and promotion expenses were
$2,698,484, $3,169,974, and $2,514,166 for the years ended December 31, 2001,
2000 and 1999, respectively.

LONG-LIVED ASSETS - Long-lived assets and certain identifiable intangibles held
and used by the Company are reviewed for impairment when events or changes in
circumstances warrant such a review. The carrying value of a long-lived or
intangible asset is considered impaired when the anticipated undiscounted cash
flow from such asset is less than its carrying value. In that event, an
impairment loss is recognized. Losses on long-lived assets to be disposed of are
determined in a similar manner, except that fair values are reduced for the cost
of disposition.

SLOT CLUB LIABILITY - The Company has accrued for the liability of points earned
but not redeemed by its slot club members, less inactive players and expired
points. The liability is calculated based on average historical redemption rate.
Expenses incurred from actual cash redemption and the change in reserve for slot
club redemption is included in promotional allowances on the consolidated
statement of income.

FAIR VALUE OF FINANCIAL INSTRUMENTS - The Company believes, based upon current
information, that the carrying value of the Company's cash and cash equivalents,
restricted cash, accounts receivable and accounts payable approximates fair
value. The Company estimates the fair value of its long-term debt approximates
its carrying value based on quoted market prices for the same or similar issues.

USE OF ESTIMATES - The preparation of financial statements in conformity with
generally accepted accounting principles in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the period. Actual results
could differ from those estimates.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS - We adopted Emerging Issues Task
Force ("EITF") No. 00-14, "Accounting of Certain Sales Incentive," EITF No.
00-22, "Accounting for `Points' and Certain Other Time-Based or Volume-Based
Sales Incentive Offers, and Offers for Free Products or Services to Be Delivered
in the Future," and EITF 00-25, "Accounting for Consideration from a Vendor to a
Retailer in Connection with the Purchase or Promotion of the Vendor's Product,"
which requires the cash-back component of the Company's slot club reward
program, including promotional

                                      F-10

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

2.  Summary of Significant Accounting Policies   (Continued)

coupons, be classified as a reduction of revenues. We historically reported the
costs of such points as an expense. Such expenses have been reclassified to
promotional allowances for all periods presented.

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Statements ("SFAS") No. 141, "Business Combinations,"
SFAS No. 142, "Goodwill and Other Intangible Assets" and SFAS No. 143,
"Accounting for Asset Retirement Obligations." SFAS No. 141 requires all
business combinations to be accounted for using the purchase method of
accounting. SFAS No. 141 is required to be implemented for all acquisitions
initiated after June 30, 2001, and all business combinations accounted for using
the purchase method for which the date of acquisition is July 1, 2001, or later.
We applied SFAS No. 141 for our acquisition of the Fitzgeralds assets.

Under SFAS No. 142, goodwill and other indefinite lived intangible assets are no
longer subject to amortization over their useful lives, rather, they are subject
to assessments for impairment at least annually. Also, under SFAS No. 142, an
intangible asset should be recognized if the benefit of the intangible asset is
obtained through contractual or other legal rights or if the intangible asset
can be sold, transferred, licensed, rented or exchanged. Such intangibles will
be amortized over their useful lives. Under SFAS No. 142, our acquisition of the
Fitzgeralds assets was immediately subject to the provisions of SFAS No. 142. We
will test those assets for impairment at least annually.

Under SFAS No. 143, the fair value of a liability for an asset retirement
obligations is required to be recognized in the period in which it is incurred
if a reasonable estimate of fair value can be made. The associated asset
retirement costs are capitalized as part of the carrying amount of the
long-lived asset. SFAS No. 143 will be implemented by us on January 1, 2002.
Adoption of SFAS No. 143 is not anticipated to have a material impact on our
consolidated financial statements.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" which supercedes SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of"
and amends Accounting Principles Board ("APB") Opinion No. 30, "Reporting the
Results of Operations - Reporting the Effect of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions." SFAS No. 144 addresses financial accounting and reporting for the
impairment or disposal of long-lived assets and is effective for fiscal years
beginning after December 15, 2001, and interim periods within those fiscal
years. Adoption of SFAS No. 144 will not have a material impact on our
consolidated financial statements.

3.  Certificate of Suitability

On December 9, 1994, the Indiana Gaming Commission (the "Commission") awarded
the Company one of two certificates (the "Certificate") for a riverboat owner's
license for a riverboat casino to be docked in the City. Having complied with
certain statutory and regulatory requirements and other conditions of the
Commission, the Company received a five-year riverboat owner's license on June
3, 1996. On August 23, 2001, the Company's riverboat ownership license was
renewed for a one-year period beginning June 7, 2001. There can be no assurance
that the Company's license will be renewed beyond the one-year period.

                                      F-11

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

3.  Certificate of Suitability (Continued)

The second certificate was issued to Trump Indiana, Inc. ("Trump"). The Company
and Trump jointly developed and operate a docking location from which the
entities are conducting their respective riverboat gaming operations in the
City.

4.  City of Gary, Indiana Development Obligation

On September 7, 1995, the Company and the City entered into an agreement for the
purpose of summarizing procedures regarding the acquisition of a certain parcel
of land in accordance with the Certificate. The Company paid the City $250,000
under the terms of this agreement. On September 29, 1995, the Company and Trump
entered into an agreement with the City for which the Company paid the City
$5,000,000. As of December 31, 2001, the deferred costs representing the
Company's development obligation to the City has been fully amortized.

As of March 26, 1996, the City and the Company entered into a development
agreement which supersedes the previous agreement between the City and the
Company. The development agreement ("Development Agreement") requires the
Company, among other things, (1) to invest $116 million in various on-site
improvements over the succeeding five years, (2) pay the City an economic
incentive equal to 3% of the Company's adjusted gross receipts, as defined by
the Riverboat Gambling Act and (3) pay a default payment in the amount of
damages for failure to complete certain on-site developments, which amount is
capped at $12 million.

The Company fulfilled all commitments with respect to the Development Agreement
as of September 2000, by purchasing and equipping the Permanent Vessel,
constructing substantial harbor improvements and the BHR facilities, and by
investing in an affiliated entity that purchased land for future development
adjacent to the BHR facility. In addition, the Company is current on its ongoing
economic incentive payments.

5.  Acquisitions

On December 6, 2001, we, through certain indirect wholly-owned subsidiaries,
completed the acquisition of substantially all of the assets and assumed certain
liabilities of Fitzgeralds Las Vegas, Inc. ("Fitzgeralds Las Vegas"),
Fitzgeralds Mississippi, Inc. ("Fitzgeralds Tunica") and 101 Main Street Limited
Liability Company ("Fitzgeralds Black Hawk") (the "Fitzgeralds assets") for
approximately $152.7 million in cash, which includes the purchase price of
$149.0 million and professional fees and other expenses related to the
acquisition. We are accounting for the acquisition under the purchase method.
Accordingly, the purchase price is allocated to the underlying assets acquired
and liabilities assumed based upon their estimated fair values at the date of
acquisition. We determined the estimated fair value of property and equipment
and intangible assets based upon third-party valuations.

                                      F-12

<PAGE>
                            MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR THE YEARS ENDED DECEMBER 31, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999

5.  Acquisitions (Continued)

The purchase price was determined based upon estimates of future cash flows and
the net worth of the assets acquired. Majestic Investor Holdings, LLC funded the
acquisition through the issuance of its 11.653% Senior Secured Notes (see Note
10). The results of operations for the twenty-five days ended December 31, 2001,
since the acquisition on December 6, 2001, are included in our consolidated
statement of income. The following table summarizes the estimated fair value of
the assets acquired and the liabilities assumed at the acquisition date.

<TABLE>
<CAPTION>
(In millions)                                 At December 6, 2001
                                              -------------------
<S>                                           <C>
Current assets                                      $ 12.2
Property and equipment                               122.9
Intangible assets                                     19.4
Goodwill                                              10.6
Other noncurrent assets                                2.0
                                                    ------

         Total assets acquired                       167.1
                                                    ------

Current liabilities                                   14.0
Other noncurrent liabilities                           0.4
                                                    ------

         Total liabilities assumed                    14.4
                                                    ------

Net                                                 $152.7
                                                    ======
</TABLE>
Intangible assets include $9.8 million for customer relationships, $3.7 million
for tradename and $5.2 million for gaming licenses. Intangible assets for
customer relationships and tradenames are being amortized over a period of 8-10
years. In accordance with SFAS 142, goodwill, and other indefinite lived
intangible assets, such as the Company's gaming license, are not amortized but
instead are subject to impairment tests at least annually.

The following unaudited pro forma consolidated financial information has been
prepared assuming our acquisition had occurred on January 1, 2000.

<TABLE>
<CAPTION>
                                               For the years ended
                                    December 31, 2001       December 31, 2000
                                 -----------------------------------------------
                                                   (unaudited)
<S>                              <C>                        <C>
Net revenues                          $287,252,248           $ 273,171,030

Income from operations                $ 21,379,013           $  26,614,526

Net loss                              $(12,839,976)          $ (10,531,166)
</TABLE>
These unaudited pro forma results are presented for comparative purposes only.
The pro forma results are not necessarily indicative of what our actual results
would have been had the acquisition been completed as of the beginning of the
year, or of future results.

                                      F-13

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

6.  Property and Equipment

Property and equipment at December 31, 2001 and 2000 consists of the following:

Substantially all property and equipment are pledged as collateral on long-term
debt.  See Note 10.

<TABLE>
<CAPTION>
                                                                                              Estimated
                                                                                             Service Life
                                                          2001              2000                (Years)
<S>                                                   <C>                <C>                 <C>
Land used in casino operations                        $  6,403,371       $          -
Vessel, building and improvements                      116,161,959         44,639,971            25-39
Site Improvements                                       15,870,892                  -                9
Barge and improvements                                  15,555,248            848,946             5-15
Leasehold improvements                                     237,763            195,253                5
Furniture, fixtures and equipment                       44,131,889         25,399,692              4-5
Construction in progress                                   713,772                  -
                                                      ------------       ------------
                                                       199,074,894         71,083,862

Less accumulated depreciation and amortization         (28,879,881)       (21,925,291)
                                                      ------------       ------------

       Property and equipment, net                    $170,195,013       $ 49,158,571
                                                      ============       ============
</TABLE>

                                      F-14

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.  Other Intangible Assets

The gross carrying amount and accumulated amortization of the Company's
intangible assets, other than goodwill, as of December 31, 2001 are as follows:

<TABLE>
<CAPTION>
                                                     Gross Carrying       Accumulated
                                                         Amount           Amortization
                                                    ------------------ -------------------
                                                               (in thousands)
<S>                                                 <C>                <C>
Amortized intangible assets:

Customer relationships                                        $ 9,800              $ (84)
Tradename                                                       3,700                (25)
Riverboat excursion license                                       700                  -
                                                    -----------------  -----------------
Total                                                         $14,200              $(109)
                                                    -----------------  -----------------


Unamortized intangible assets:

Gaming license                                                $ 5,200
                                                    -----------------
Total                                                         $ 5,200
                                                    =================
</TABLE>

The amortization expense recorded on the intangible assets for the year ended
December 31, 2001 was $0.1 million. The estimated amortization expenses for each
of the five succeeding fiscal years is as follows:

<TABLE>
<CAPTION>
For the year ending December 31,
--------------------------------
<S>                                                    <C>
2002                                                    $1,595
2003                                                     1,642
2004                                                     1,642
2005                                                     1,642
2006                                                     1,642
</TABLE>

8.  Investment in Buffington Harbor Riverboats, L.L.C.

On October 31, 1995, the Company and Trump entered into the First Amended and
Restated Operating Agreement of BHR for the purpose of acquiring and developing
certain facilities for the gaming operations in the City ("BHR Property"). BHR
is responsible for the management, development and operation of the BHR
Property. The Company and Trump have each entered into an agreement with BHR
(the "Berthing Agreement") to use BHR Property for their respective gaming
operations and have committed to pay cash operating losses of BHR as additional
berthing fees. The Company and BHR share equally in the operating expenses
relating to the BHR Property, except for costs associated with food and
beverage, and valet operations, which are allocated on a percentage of use by
the casino customers of the Company and the Joint Venture Partner.

                                      F-15

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8.  Investment in Buffington Harbor Riverboats, L.L.C.   (Continued)

The following represents selected financial information of BHR:

<TABLE>
<CAPTION>
                                               December 31, 2001          December 31, 2000
             BALANCE SHEET
<S>                                            <C>                        <C>
Cash and cash equivalents                           $   317,646               $   286,921
Current assets                                          782,001                15,843,359
Property, plant and equipment, net                   69,650,069                75,100,370
Other assets                                            111,478                   116,955

Total assets                                         70,543,548                91,060,684

Current liabilities                                   2,745,899                10,311,785

Total liabilities                                     2,745,899                10,311,785

Members' equity
The Majestic Star Casino, LLC                        33,898,825                43,924,033

Total members' equity                                67,797,649                80,748,899


<CAPTION>
                                                                      Years Ended December 31,
                                                                      ------------------------
                                                      2001                      2000                    1999
                                                      ----                      ----                    ----
          STATEMENTS OF INCOME

<S>                                               <C>                         <C>                     <C>
Gross revenue                                     $ 16,468,581                17,814,012              $ 18,293,939

Operating income (loss)                             (5,981,620)               (4,350,334)               (5,701,264)

Net income (loss)                                   (5,595,475)               (4,117,338)               (5,696,010)
</TABLE>

At December 31, 2001, 2000, and 1999, the Company's consolidated income
statements reflect approximately $8,614,000, $8,973,000, and $9,300,000,
respectively, in vessel berthing fees and promotional allowances of which
$8,947,000, $8,519,000, and $9,123,000 was paid in 2001, 2000, and 1999,
respectively.

                                      F-16

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     9.  Other Accrued Liabilities

       Other accrued liabilities at December 31 were comprised of:

     <TABLE>
     <CAPTION>
                                                               2001              2002
                                                               ----              ----
<S>                                                        <C>                 <C>
       Property taxes                                       $  2,168,667        $1,439,220
       Slot Club points                                        2,087,087                -
       Progressive jackpots                                    2,883,958           488,706
       Other                                                   5,880,385         1,669,998
                                                            ------------         ----------
                                                            $ 13,020,097        $3,597,924
     </TABLE>

     10. Long - Term Debt

     Long-term debt at December 31 is as follows:

<TABLE>
<CAPTION>
                                                                                           2001                2000
                                                                                           ----                ----

<S>                                                                                   <C>                 <C>
     $152,632,000 senior secured notes payable, net of unamortized discount of
     $7,546,568; collateralized by a first priority lien on substantially all of
     the assets of Majestic Investor Holdings, LLC, due in semi-annual
     installments of interest at 11.653% on May 31 and November 30;
     with a final payment of principal and interest due on November 30, 2007.         $ 145,085,432       $           -

     $130,000,000 senior secured notes payable, net of unamortized discount of
     $1,443,371 at 2001 and $1,766,514 at 2000; collateralized by a first
     priority lien on substantially all of the assets of Majestic Star Casino,
     LLC, due in semi-annual installments of interest at 10 7/8% on July 1 and
     January 1; with a final payment of principal and interest due on July 1, 2006.     128,556,629         128,233,486

     $20.0 million four-year credit facility established on August 2, 1999,
     expiring on August 2, 2003; collateralized by substantially all current and
     future assets of Majestic Star Casino, LLC, other than excluded assets;
     interest rate at the borrowers choice of LIBOR plus 3.75% or 1.5% points
     above the base rate which approximates the prime rate, with a minimum
     interest rate of 8.5%.                                                                       -           7,800,000

     $15.0 million four-year credit facility established on December 6, 2001,
     expiring on December 5, 2005; collateralized by substantially all current
     and future assets of Majestic Investor Holdings, LLC, other than excluded
     assets; interest rate at the borrowers choice of LIBOR plus 2.0% or the
     base rate which approximates the prime rate.                                         6,500,000                   -

     Equipment and software financing payable at Majestic Investor Holdings, LLC
     including related use taxes; collateralized by gaming equipment; interest
     rates from 7.5% to 12.0%; due in aggregate monthly installments of
     $13,526 with varying maturity dates through 2005.                                      411,446                   -

     Equipment financing payable at Majestic Star Casino, LLC including related
     use taxes; collateralized by gaming equipment; due in aggregate monthly
     installments with varying maturity dates through September 2001.                             -           1,011,719
                                                                                      -------------       -------------
                                                                                        280,553,507         137,045,205

     Less current maturities                                                             (6,656,574)         (8,811,719)
                                                                                      -------------       -------------

     Long-term debt, net of current maturities                                        $ 273,896,933       $ 128,233,486
                                                                                      =============       =============
</TABLE>

                                      F-17

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

10.  Long - Term Debt  (Continued)

     The schedules maturities of long-term debt are as follows:

<TABLE>
<CAPTION>
     Year Ending December 31,
<S>                                                 <C>
           2002                                     $  6,656,574
           2003                                          133,066
           2004                                           84,346
           2005                                           37,460
           2006                                      128,556,629
     Thereafter                                      145,085,432
                                                     -----------

                                                    $280,553,507
                                                    ============
</TABLE>

Senior Secured Notes

On June 18, 1999, the Company issued $130.0 million of 10-7/8% Senior Secured
Notes due 2006. In October 1999, the Company successfully completed an exchange
of its privately placed $130.0 million 10-7/8% Senior Secured Notes Series A for
$130.0 million 10-7/8% Senior Secured Notes Series B that are registered with
the Securities and Exchange Commission. The net proceeds from the offering were
utilized to redeem $99.0 million principal amount of the Company's 12-3/4%
Senior Secured Notes due 2003 with Contingent Interest. During June 1999,
approximately $4.2 million of the net proceeds were utilized for fees to fund
the repurchase and approximately $7.5 million of the net proceeds were
classified as restricted cash to effect a covenant defeasance of the $6.0
million of remaining 12-3/4% Senior Secured Notes due 2003 with Contingent
Interest. During May 2000, the Company redeemed this remaining $6.0 million of
12-3/4% Senior Secured Notes. Holders of the outstanding 10-7/8% Senior Secured
Notes have the right to require that the Company repurchase the notes at a
premium under certain conditions, including a change in control of the Company.

The 10-7/8% Senior Secured Notes bear interest at a fixed rate of 10-7/8% per
annum payable January 1 and July 1 each year, commencing January 1, 2000.
Substantially all of the Company's current and future assets other than certain
excluded assets are pledged as collateral. Excluded assets include the assets of
our "unrestricted subsidiaries," which include the subsidiaries that hold our
Fitzgeralds assets. The notes rank senior in right of payment to any of the
Company's subordinated indebtedness and equally with any of the Company's senior
indebtedness.

                                      F-18

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     10. Long - Term Debt (Continued)

     After July 1, 2003, the Company may, at its option, redeem all or some of
     the notes at a premium that will decrease over time from 105.438% to 100%
     of their face amount, plus interest. Prior to July 1, 2002, if the Company
     publicly offers certain equity securities, as defined, it may, at its
     option, apply part of the net proceeds from those transactions to redeem up
     to 35% of the principal amount of the notes at 110.875% of their face
     amount, plus interest. If the Company goes through a change of control, it
     must give holders of the notes the opportunity to sell the Company their
     notes at 101% of their face amount, plus interest.

     The Indenture contains covenants, which among other things, restrict the
     Company's ability to (i) make certain distributions and payments, (ii)
     incur additional indebtedness, (iii) enter into transactions with
     affiliates, (iv) sell assets or stock, and (v) merge, consolidate or
     transfer substantially all of its assets.

     On December 6, 2001, Majestic Investor Holdings, LLC issued $152.6 million
     of 11.653% Senior Secured Notes due 2007. The net proceeds of $145,000,400
     from the offering, together with an equity contribution were utilized to
     purchase substantially all of the assets of Fitzgeralds Tunica, Fitzgeralds
     Black Hawk and Fitzgeralds Las Vegas and to pay related fees and expenses.

     The 11.653% Senior Secured Notes bear interest at a fixed rate of 11.653%
     per annum payable May 31 and November 30 each year, commencing May 31,
     2002. Substantially all of Majestic Investor Holdings' current and future
     assets other than certain excluded assets are pledged as collateral. The
     notes rank senior in right of payment to any of Majestic Investor Holdings
     LLC's subordinated indebtedness and equally with any of Majestic Investor
     Holdings LLC's senior indebtedness.

     On or after November 30, 2005, Majestic Investor Holdings LLC has the right
     to redeem notes from time to time at a price that will decrease over time
     from 105.827% of the principal amount in 2005 to 100% of the principal
     amount in 2006, plus, in each case, accrued and unpaid interest. Prior to
     November 30, 2004, Majestic Investor Holdings LLC may, at its option, apply
     part of the net proceeds from certain equity offerings to redeem up to 35%
     of the principal amount of the notes at 111.653% of their face amount, plus
     accrued and unpaid interest.

     The Indenture contains covenants, which among other things, restrict
     Majestic Investor Holdings LLC's ability to (i) make certain distributions
     and payments, (ii) incur additional indebtedness, (iii) enter into
     transactions with affiliates, (iv) sell assets or stock, and (v) merge,
     consolidate or transfer substantially all of its assets.

                                      F-19

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     10. Long - Term Debt (Continued)

     Credit Facilities

     On August 2, 1999, the Company established a $20.0 million credit facility,
     which is also secured by substantially all current and future assets, other
     than certain excluded assets. The lien on the collateral securing this
     credit facility is structurally senior to the lien securing the 10-7/8%
     Senior Secured Notes. As of December 31, 2000, $7.8 million of the credit
     facility was outstanding. During 2001, $8.0 million was borrowed on this
     credit facility, and at December 31, 2001, these borrowings had been repaid
     in full. As of April 1, 2002, there was no outstanding balance on the
     credit facility.

     The terms of the $20.0 million line of credit is four years with an
     interest rate at the Company's choice of LIBOR plus 3.75% or 1.5 percentage
     points above the base rate. The base rate approximates the prime rate. The
     minimum interest rate is 8.5%. The credit agreement includes covenants,
     which among other things, (i) require operating income as defined in the
     credit facility of at least $10.0 million for twelve consecutive months
     during the credit period, and (ii) restrict the Company's ability to incur,
     assume, or guarantee any indebtedness.

     On December 6, 2001, Majestic Investor Holdings, LLC established a $15.0
     million credit facility. It is permitted to borrow up to $12.0 million
     under the credit facility, pending the approval by the Nevada Gaming
     Authorities of the pledge by Majestic Investor Holdings, LLC of the
     membership interests in Barden Nevada Gaming, LLC in connection with the
     credit facility. Majestic Investor Holdings, LLC recently filed an
     application for the necessary approval by the Nevada Gaming Authorities for
     the pledge necessary in connection with the credit facility. The terms of
     the $15.0 million line of credit is four years with an interest rate at the
     Company's choice of LIBOR plus 2.0%, or the base rate, which approximates
     the prime rate. The credit facility is secured by substantially all of
     Majestic Investor Holdings, LLC's current and future assets, other than
     certain excluded assets. The lien on the collateral securing Majestic
     Investor Holdings, LLC's credit facility is senior to the lien on the
     collateral securing the senior secured notes. The credit facility also
     contains financial covenants and restrictions on, among other things,
     indebtedness, investments, distributions and mergers. As of April 1, 2002,
     the outstanding balance on the credit facility was approximately $1.7
     million.

     Intercreditor Agreements

     In connection with Majestic Star entering into its $20.0 million credit
     facility, the trustee (as collateral agent) under the indenture associated
     with Majestic Star's senior secured notes entered into an intercreditor
     agreement with Foothill Capital Corporation, the lender under Majestic
     Star's credit facility. In addition, in connection with Majestic Investor
     Holdings entering into its $15.0 million credit facility, the trustee (as
     collateral agent) under the indenture associated with Majestic Investor
     Holdings' senior secured notes entered into a virtually identical
     intercreditor agreement with Foothill Capital Corporation, the lender under
     Majestic Investor Holdings' credit facility. Both intercreditor agreements
     provide for the subordination of the liens securing the respective senior
     secured notes to the liens securing the indebtedness under the respective
     credit facilities.

                                      F-20

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

10.  Long - Term Debt   (Continued)

The intercreditor agreements, among other things, limits the trustee's rights in
an event of default under the respective senior secured notes. Under the
intercreditor agreements, if the respective senior secured notes become due and
payable prior to the stated maturity or are not paid in full at the stated
maturity at a time during which there is indebtedness outstanding under the
corresponding credit facilities, the trustee will not have the right to
foreclose upon the collateral unless and until the lender under the
corresponding credit facilities fails to take steps to exercise remedies with
respect to or in connection with the collateral within 180 days following notice
to such lender of the occurrence of an event of default under the corresponding
indenture. In addition, the intercreditor agreements prevent the trustee and the
holders of the respective senior secured notes from pursuing remedies with
respect to the collateral in an insolvency proceeding. The intercreditor
agreements also provide that the net proceeds from the sale of the corresponding
collateral will first be applied to repay indebtedness outstanding under the
corresponding credit facilities and thereafter to the holders of the
corresponding senior secured notes.

11.  Fair Value of Financial Instruments

The following table presents the carrying value and estimated fair value as of
December 31, 2001 of the Company's financial instruments. (Refer to Notes 2 and
10).

<TABLE>
<CAPTION>
                                                 Carrying          Estimated
                                                  Value           Fair Value
                                                  -----           ----------
<S>                                              <C>              <C>
Assets:
      Cash and equivalents                       $ 25,925,291       $ 25,925,291
      Restricted cash                            $  1,000,000       $  1,000,000

Liabilities:
      Long-term debt (including capital lease
      obligations and line of credit borrowings) $280,553,507       $278,097,313
</TABLE>

12. Savings Plan

The Company contributes to a defined contribution plan which provides for
contributions in accordance with the plan document. The plan is available to
certain employees with at least one year of service. The Company contributes a
matching contribution up to a maximum of 3% of an employee's salary limited to a
specified dollar amount as stated in the plan document. The Company's
contributions to the plan amounted to $402,000, $340,000 and $303,000 during
2001, 2000 and 1999, respectively.

                                      F-21

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

13.  Commitments and Contingencies

Leases

The Company has operating leases that cover various office and gaming equipment.
Future minimum lease payments for operating leases with initial terms in excess
of one year as of December 31, 2001 are as follows:

<TABLE>
<CAPTION>
                  Year ending December 31,
<S>                                                        <C>
                  2002                                     $  1,422,407
                  2003                                        1,254,338
                  2004                                          972,948
                  2005                                          811,604
                  2006                                          774,092
                  Thereafter                                    774,092
                                                           ------------

                                                           $  6,009,481
                                                           ============
</TABLE>

Employment Agreements

Mr. Don H. Barden serves as the Company's Manager, Chairman, President and Chief
Executive Officer and currently receives annual compensation of $370,000 as an
employee, pursuant to a letter agreement dated October 22, 2001 with The
Majestic Star Casino, LLC.

Mr. Michael E. Kelly serves as the Company's Manager, Executive Vice President,
Chief Operating and Financial Officer and Secretary pursuant to a three-year
employment agreement with The Majestic Star Casino, LLC dated October 22, 2001.
Under this agreement, Mr. Kelly will receive base compensation of $400,000 per
year and can also earn annual incentive compensation based upon his performance
and Majestic Star's performance. In addition to such compensation, Mr. Kelly is
entitled to term life insurance in an amount equal to $2.5 million and other
customary employee benefits, including participation in The Majestic Star
Casino, LLC's 401(k) plan, together with a $100,000 signing bonus and an
interest-free loan in the amount of $200,000 to be repaid in three equal annual
installments. Mr. Kelly is also entitled to additional compensation, upon a
change in control, equal to his base salary and incentive compensation for the
remainder of the term of the agreement, plus 12 months thereafter. Mr. Kelly's
employment agreement contains certain non-competition provisions with a duration
of 12 months following termination of his employment.

The amounts payable pursuant to the agreements with Messrs. Barden and Kelly are
the responsibility of the Company. As indicated in Note 14, the Company entered
into an Expense Reimbursement/Sharing Agreement with Majestic Investor Holdings
whereby Majestic Investor Holdings will reimburse the Company for a specified
percentage of expenses paid by the Company for Majestic Investor Holdings'
corporate overhead.

                                      F-22

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

13.  Commitments and Contingencies  (Continued)

Letter of Credit/Surety Bond

In May 1996, the Company was required by the City of Gary, to maintain a Surety
Bond in the amount of $12.5 million to guarantee the remaining $10.0 million of
its site off-site development obligation and $2.5 million to satisfy state and
local regulatory obligations. The Surety Bond was secured by a $3.5 million
letter of credit issued by a bank, which was collateralized by $3.6 million in
cash. In September 2000, the Company met its development obligation,
concurrently the Surety Bond was reduced from $12.5 million to $2.5 million and
the bank released $1.0 million of the cash collateral. In March 2001, the
Company replaced its existing Surety Bond with a new $2.5 million unsecured
Surety Bond. In conjunction with the release of the original Surety Bond, the
letter of credit was canceled and the remaining $2.6 million of cash collateral
was released to the Company. The new Surety Bond is secured only by a personal
guarantee of Don H. Barden. If Mr. Barden is required to make payments to the
bonding company as a result of the guaranty, the Company will be obligated to
reimburse Mr. Barden for any such payments.

Legal Proceedings

On June 25, 1997, a complaint was filed in an Illinois Cook County Court against
Majestic Star Casino. The plaintiff, a former employee, was injured during and
as a result of a routine boat drill attempt and is requesting compensatory and
punitive damages totaling approximately $3.5 million. The suit alleges that
Majestic Star Casino failed to provide adequate safety measures to their
employees during these drills. The parties are in settlement negotiations. The
Company does not believe that the resolution of this suit will have a material
impact on the Company's financial position and results of operation.

On March 27, 1998, a complaint was filed in the Lake County Superior Court in
East Chicago, Indiana, against BHR, the Joint Venture Partner, and the Company.
The plaintiff, a former employee of the Company, claims to have been assaulted
in the BHR parking lot on June 25, 1997 and is requesting compensatory and
punitive damages totaling approximately $11.0 million. The suit alleges that the
Joint Venture Partner and the Company failed to provide adequate security to
prevent assaults. The Company intends to vigorously defend against such suit.
However, it is too early to determine the outcome of such suit and the effect,
if any, on the Company's financial position or results of operations.

On March 2, 2000, the Company was issued a notice of audit findings, and on May
11 and 12, 2000, was issued notices of assessment by the Indiana Department of
Revenue for income tax withholding deficiencies for the years ended 1996 and
1998. The Indiana Department of Revenue has taken the position that wagering
taxes should not be classified as an allowable deductible expense for
calculating state income taxes and therefore requires that wagering taxes be
added back to net income to determine the tax liability. The estimated tax
deficiency for 1996 is approximately $239,000 excluding interest and the
estimated tax deficiency for 1998 is approximately $315,000 excluding interest.
This same finding has been protested by other Indiana casinos. The Company has
filed an administrative protest and demand for hearing with the Indiana
Department of Revenue. However, it is too early to determine the outcome of such
a protest.

                                      F-23

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

13.  Commitments and Contingencies (Continued)

From time to time, the Company may be involved in routine administrative
proceedings involving alleged violations of certain provisions of gaming
regulations of states in which the Company does business. Management believes
that the outcome of any such proceedings will not, either individually or in the
aggregate, have a material adverse effect on the Company or its ability to
retain and/or renew any license required for the Company's operations. No such
proceedings are pending at this time.

Gaming Regulations

The ownership and operation of riverboat gaming operations in Indiana are
subject to strict state regulation under the Riverboat Gambling Act ("Act") and
the administrative rules promulgated thereunder. The Indiana Gaming Commission
("IGC") is empowered to administer, regulate and enforce the system of riverboat
gaming established under the Act and has jurisdiction and supervision over all
riverboat gaming operations in Indiana, as well as all persons on riverboats
where gaming operations are conducted. The IGC is empowered to regulate a wide
variety of gaming and nongaming related activities, including the licensing of
supplies to, and employees at, riverboat gaming operations and to approve the
form of entity qualifiers and intermediary and holding companies. Indiana is a
new jurisdiction and the emerging regulatory framework is not yet complete. The
IGC has adopted certain final rules and has published others in proposed or
draft form which are proceeding through the review and final adoption process.
The IGC has broad rulemaking power, and it is impossible to predict what effect,
if any, the amendment of existing rules or the finalization of currently new
rules might have on the Company's operations.

The ownership and operation of our other casino gaming facilities in Nevada,
Mississippi and Colorado are also subject to various state and local regulations
in the jurisdictions where they are located. In Nevada, our gaming operations
are subject to the Nevada Gaming Control Act, and to the licensing and
regulatory control of the Nevada Gaming Commission, the Nevada State Gaming
Control Board and various local ordinances and regulations, including, without
limitation, applicable city and county gaming and liquor licensing authorities.
In Mississippi, our gaming operations are subject to the Mississippi Gaming
Control Act, and to the licensing and/or regulatory control of the Mississippi
Gaming Commission, the Mississippi State Tax Commission and various state and
local regulatory agencies, including liquor licensing authorities. In Colorado,
our gaming operations are subject to the Limited Gaming Act of 1991, which
created the Division of Gaming within the Colorado Department of Revenue and the
Colorado Limited Gaming Control Commission to license, implement, regulate and
supervise the conduct of limited gaming. Our operations are also subject to the
Colorado Liquor Code and the state and local liquor licensing authorities.

The Company's directors, officer, managers and key employees are required to
hold individual licenses, which requirements vary from jurisdiction to
jurisdiction. Licenses and permits for gaming operations and of individual
licensees are subject to renovation or non-renewal for cause. Under certain
circumstances, holders of our securities are required to secure independent
licenses and permits.

                                      F-24

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

14.  Related Party Transactions

The Majestic Star Casino, LLC ("Majestic Star") entered into a Management
Agreement on June 18, 1999 with BDI to provide for, among other things, a
management fee payable by Majestic Star to BDI for acting as the manager. The
fees for each fiscal quarter will be equal to 5% of The Majestic Star Casino,
LLC's Consolidated Cash Flow (as defined in the Indenture for the Majestic Star
Senior Secured Notes) for the immediately preceding fiscal quarter and may not
be paid if Majestic Star is in default under the Indenture governing such notes
or if Majestic Star does not meet certain financial ratios as provided in such
Indenture. For the three month periods ending September 30, 1999, December 31,
1999 and March 31, 2000, approximately $325,000, $282,000, and $315,000
respectively, was paid to BDI in accordance with the Management Agreement. No
management fees have been paid for the period April 1, 2000 through September
30, 2001 since Majestic Star has not met certain financial ratios as provided in
the Indenture. For the three months ended December 31, 2001, approximately
$280,000 was paid to BDI in accordance with the Management Agreement.

In September 2000, Majestic Investor, LLC was capitalized by Majestic Star with
$8.8 million of capital contributions, including interest thereon. Majestic
Investor, LLC subsequently contributed this $8.8 million to Majestic Investor
Holdings, LLC in connection with the assignment of its rights and obligations
under the Fitzgeralds purchase and sale agreement to Majestic Investor Holdings,
LLC.

Prior to the consummation of the offering of the Majestic Investor Holdings, LLC
11.653% Senior Secured Notes, Majestic Investor Holdings, LLC issued a 35.71%
membership interest to Barden Development, Inc. (a company wholly-owned by Mr.
Barden and a member of the Majestic Star Casino, LLC)("BDI") in exchange for the
contribution by BDI of a note for $5.0 million. BDI subsequently contributed the
35.71% membership interest to Majestic Investor, LLC as additional
paid-in-equity. Majestic Investor, LLC currently owns 100% of the member
interests of Majestic Investor Holdings, LLC. BDI, upon closing of the offering
of the senior secured notes, contributed $5.0 million in repayment of the
promissory note.

On September 19, 2001, Majestic Investor Holdings, LLC entered into a Management
Agreement with BDI, which was amended and restated on December 5, 2001 effective
December 6, 2001, pursuant to which Majestic Investor Holdings, LLC will pay to
BDI fees for acting as the Manager of Majestic Investor Holdings, LLC, which
Management Fees, for any fiscal quarter, shall not exceed 1% of net revenues
plus 5% of consolidated cash flow for the immediately preceding fiscal quarter,
provided that the payment of such Management Fees shall be subordinated to the
payment in full of principal, interest, premium and liquidated damages, if any,
then due on the senior secured notes.

On October 22, 2001, Majestic Investor Holdings, LLC entered into an Expense
Reimbursement/Sharing Agreement with Majestic Star, pursuant to which Majestic
Investor Holdings, LLC and its restricted subsidiaries will each reimburse
Majestic Star for sixty percent (60%) of the documented out-of-pocket expenses
paid by Majestic Star for Majestic Investor Holdings, LLC's corporate overhead,
including (i) the costs and expenses of executives and certain other employees,
including, but not limited to, salaries, bonuses, benefit payments, insurance,
and supplies, (ii) rent and (iii) other similar costs and expenses. These
executives and employees will provide services to both Majestic Investor
Holdings, LLC and to us and our subsidiaries. Currently, due to restrictions set
forth in the Investor Holdings Indenture, the reimbursement percentage is capped
at fifty percent (50%) up to an aggregate of $1.7 million. For the year ended
December 31, 2001, the Company earned approximately $142,000 related to the
Expense Reimbursement/Sharing Agreement with Majestic Investor Holdings.

                                      F-25

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

14.  Related Party Transactions  (Continued)

Interest of $185,750 on a $2.0 million note made by Majestic Investor, LLC to
BDI which was later assigned to Majestic Investor Holdings, LLC remains
outstanding at December 31, 2001. BDI paid the principal of the note in
conjunction with the closing of the acquisition on December 6, 2001.

In December 2001, Majestic Investor Holdings, LLC issued a $700,000 note to BDI.
The note bears interest at a rate of 7% per annum and is due and payable in full
on December 12, 2002.

During 2001, The Majestic Star Casino, LLC made a $300,000 employee loan to Mr.
Barden. This loan bears interest at a rate of 7% per annum and is due and
payable in full on December 12, 2002.

15.  Segment Information

The Company owns and operates four properties as follows: a riverboat casino
located in Gary, Indiana; a casino and hotel located in downtown Las Vegas,
Nevada; a casino and hotel located in Tunica, Mississippi; and a casino located
in Black Hawk, Colorado (collectively, the "Properties"). The Company identifies
its business in four segments based on geographic location. The Properties
market in each of their segments primarily to middle-income guests. The major
products offered in each segment are as follows: casino, hotel (except in Gary,
Indiana and Black Hawk, Colorado) and food and beverage.

The accounting policies of each business segment are the same as those described
in the summary of significant accounting policies. There are minimal
inter-segment sales. Corporate costs are allocated to the business segment
through management fees.

A summary of the Properties' operations by business segment for the year ended
December 31, 2001 is presented below:

<TABLE>
<CAPTION>
                                                                  (in thousands)
<S>                                                               <C>
     Net revenues:
         Majestic Star Casino ..................................    $  119,072
         Fitzgeralds Las Vegas .................................         3,081
         Fitzgeralds Tunica ....................................         5,368
         Fitzgeralds Black Hawk ................................         2,072
         Unallocated and other (1) .............................            --
                                                                  ------------
              Total ............................................    $  129,593
                                                                  ============

     Income (loss) from operations:
         Majestic Star Casino ..................................    $   17,303
         Fitzgeralds Las Vegas .................................          (393)
         Fitzgeralds Tunica ....................................           654
         Fitzgeralds Black Hawk ................................           674
         Unallocated and other (1) .............................        (1,214)
                                                                  ------------
              Total ............................................    $   17,024
                                                                  ============
</TABLE>

                                      F-26

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

15.  Segment Information  (Continued)

<TABLE>
<S>                                                                                <C>
     Segment depreciation and amortization:
         Majestic Star Casino .................................................     $     8,070
         Fitzgeralds Las Vegas ................................................             167
         Fitzgeralds Tunica ...................................................             485
         Fitzgeralds Black Hawk ...............................................             100
         Unallocated and other (1) ............................................             169
                                                                                   ------------
              Total ...........................................................     $     8,991
                                                                                   ============

     Expenditures for additions to long-lived assets:
         Majestic Star Casino .................................................     $     4,967
         Fitzgeralds Las Vegas ................................................              --
         Fitzgeralds Tunica ...................................................             100
         Fitzgeralds Black Hawk ...............................................              23
         Unallocated and other (1) ............................................              --
                                                                                   ------------
              Total ...........................................................     $     5,090
                                                                                   ============

<CAPTION>
                                                                              As of December 31, 2001
                                                                              -----------------------
                                                                                  (In thousands)
<S>                                                                           <C>
     Segment assets:
         Majestic Star Casino .................................................     $   107,659
         Fitzgeralds Las Vegas ................................................          45,157
         Fitzgeralds Tunica ...................................................          91,338
         Fitzgeralds Black Hawk ...............................................          30,915
         Unallocated and other (1) ............................................          16,352
                                                                                   ------------
              Total ...........................................................     $   291,421
         Less:  intercompany ..................................................            (361)
                                                                                   ------------
              Total ...........................................................     $   291,060
                                                                                   ============
</TABLE>

___________________

(1) Unallocated and other include corporate items and eliminations that are not
allocated to the operating segments.

                                      F-27

<PAGE>
                          THE MAJESTIC STAR CASINO, LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

16.  Supplemental Guarantor Financial Information

The Company's $130.0 million, 10 7/8% Senior Secured Notes (See Note 10) are
guaranteed by substantially all of the assets of the Company, except for those
assets of Majestic Investor Holdings, LLC and its wholly-owned subsidiaries
which include the three casino properties acquired on December 6, 2001. The
guarantees on the 10 7/8% Senior Secured Notes rank senior in right of payment
to Majestic Star's subordinated indebtedness and equal with any of Majestic
Star's senior indebtedness.

Majestic Investor Holdings, LLC's $152.6 million, 11.653% Senior Secured Notes
(See Note 10) are unconditionally and irrevocably guaranteed, jointly and
severally by all of the restricted subsidiaries of Majestic Investor Holdings,
LLC. The guarantees rank senior in right of payment to all existing and future
subordinated indebtedness of these restricted subsidiaries and equal in right of
payment with all existing and future senior indebtedness of these restricted
subsidiaries.

The following condensed consolidating information presents condensed
consolidating financial statements as of December 31, 2001 and for the years
ended December 31, 2001 and 2000 of The Majestic Star Casino, LLC, Majestic
Investor Holdings, LLC, and the restricted subsidiaries of Majestic Investor
Holdings, LLC (on a combined basis) and the elimination entries necessary to
combine such entities on a consolidated basis. The Majestic Star Casino Capital
Corp. ("MSCCC"), a wholly-owned subsidiary of The Majestic Star Casino, LLC and
Majestic Investor Capital Corp. ("MICC"), a wholly-owned subsidiary of Majestic
Investor, LLC, do not have any material assets, obligations or operations.
Therefore, no information has been presented below for these subsidiaries.

                                      F-28

<PAGE>

Condensed consolidating balance sheets as of December 31, 2001

<TABLE>
<CAPTION>
                                                                     Majestic
                                                           Majestic  Investor
                                           Majestic Star   investor  Holdings,     Guarantor      Eliminating     Consolidated
                                            Casino, LLC      LLC       LLC       Subsidiaries       Entries          Total
                                           --------------  -------- ------------ --------------  -------------- ----------------
<S>                                        <C>             <C>      <C>          <C>             <C>            <C>
ASSETS

CURRENT ASSETS:
     Cash and cash equivalents             $   8,220,476   $   -    $    498,363 $   17,206,452  $           -   $   25,925,291
     Accounts receivable (net)                 1,642,462       -         269,501      1,196,044        (28,484)       3,079,523
     Inventories                                  38,144       -               -        957,564              -          995,708
     Prepaid and other current assets          1,213,056       -         707,467      1,303,570              -        3,224,093
                                           --------------  -------- ------------ --------------  -------------- ----------------
                                                               -
         Total current assets                 11,114,138       -       1,475,331     20,663,630        (28,484)      33,224,615
                                           --------------  -------- ------------ --------------  -------------- ----------------

PROPERTY AND EQUIPMENT, NET                   47,767,051       -               -    122,427,962              -      170,195,013
INTANGIBLE ASSETS, NET                                 -       -               -     19,290,753              -       19,290,753
DUE FROM RELATED PARTIES                       1,177,829       -     150,855,685              -   (152,033,514)               -
INVESTMENT IN BHR                             33,898,771       -               -              -              -       33,898,771
OTHER ASSETS                                  23,869,749       -      14,545,956      5,025,618     (8,990,943)      34,450,380
INVESTMENT IN SUBSIDIARIES                    (1,270,897)      -         935,731              -        335,166                -
                                           --------------  -------- ------------ --------------  -------------- ----------------

TOTAL                                      $ 116,556,641   $   -    $167,812,703 $  167,407,963  $(160,717,775)  $  291,059,532
                                           --------------  -------- ------------ --------------  -------------- ----------------

LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)

CURRENT LIABILITIES
     Current maturities of long-term debt  $           -   $   -    $  6,500,000 $      156,574  $           -   $    6,656,574
     Accounts payable, accrued and other      12,784,191       -       2,526,703     15,195,545        (18,927)      30,487,512
                                           --------------  -------- ------------ --------------  -------------- ----------------
                                                               -
         Total current liabilities            12,784,191       -       9,026,703     15,352,119        (18,927)      37,144,086
                                           --------------  -------- ------------ --------------  -------------- ----------------

DUE TO RELATED PARTIES                                 -       -       1,168,273    150,865,241   (152,033,514)              -
LONG-TERM DEBT, Net of current               128,556,629       -     145,085,432        254,872              -      273,896,933
   portion
                                           --------------  -------- ------------ --------------  -------------- ----------------

     Total Liabilities                       141,340,820       -     155,280,408    166,472,232   (152,052,441)     311,041,019
                                           --------------  -------- ------------ --------------  -------------- ----------------

MEMBERS' EQUITY (DEFICIT)                    (24,784,179)      -      12,532,295        935,731     (8,665,334)     (19,981,487)
                                           --------------  -------- ------------ --------------  -------------- ----------------

TOTAL                                      $ 116,556,641   $   -    $167,812,703 $  167,407,963  $(160,717,775)  $  291,059,532
                                           ==============  ======== ============ ==============  ============== ================
</TABLE>

                                      F-29
<PAGE>

Condensed consolidating statements of operations for the year ended December 31,
2001

<TABLE>
<CAPTION>
                                                          Majestic
                                        Majestic Star     Investor,   Majestic Investor    Guarantor     Eliminating   Consolidated
                                         Casino, LLC        LLC          Holdings, LLC    Subsidiaries     Entries         Total
                                        -------------   -----------   -----------------   ------------   -----------   ------------
<S>                                     <C>             <C>           <C>                 <C>            <C>           <C>
OPERATING REVENUES:
     Casino                             $ 122,194,707   $         -   $               -   $ 10,358,799   $        -    $132,553,506
     Rooms                                          -             -                   -      1,079,456            -       1,079,456
     Food and beverage                      2,128,771             -                   -      1,189,804            -       3,318,575
     Other                                  1,211,834             -                   -        203,858            -       1,415,692
                                        -------------   -----------   -----------------   ------------   ----------    ------------

         Total revenues                   125,535,312             -                   -     12,831,917            -     138,367,229
         Less promotional allowances       (6,463,501)            -                   -     (2,310,848)           -      (8,774,349)
                                        -------------   -----------   -----------------   -------------  ----------    ------------
                                                                                                                  -
         Net revenues                     119,071,811             -                   -     10,521,069            -     129,592,880
                                        -------------   -----------   -----------------   -------------  ----------    ------------

COSTS AND EXPENSES:
     Casino                                21,405,773             -                   -      4,111,503            -      25,517,276
     Rooms                                          -             -                   -        628,910            -         628,910
     Food and beverage                      2,320,567             -                   -        706,947            -       3,027,514
     Other                                          -             -                   -        108,732            -         108,732
     Gaming taxes                          34,026,160             -                   -        808,464            -      34,834,624
     Advertising and promotion              6,903,533             -                   -        926,226            -       7,829,759
     General and administration            25,364,120             -              26,476      1,543,167            -      26,933,763
     Economic incentive-City of Gary        3,667,100             -                   -              -            -       3,667,100
     Depreciation and amortization          8,069,968             -             168,930        751,718            -       8,990,616
     Loss on disposal of assets                12,114             -                   -              -            -          12,114
     Pre-opening costs                              -             -           1,018,234              -            -       1,018,234
                                        -------------   -----------   -----------------   ------------   ----------    ------------
     Total costs and expenses             101,769,335             -           1,213,640      9,585,667            -     112,568,642
                                        -------------   -----------   -----------------   ------------   ----------    ------------
     Operating income (loss)               17,302,476             -          (1,213,640)       935,402            -      17,024,238
                                        -------------   -----------   -----------------   ------------   ----------    ------------

OTHER INCOME (EXPENSE):
     Interest income                          181,551             -             215,791          2,410            -         399,752
     Interest expense                     (14,817,214)            -          (1,208,779)        (2,081)           -     (16,028,074)
     Other non-operating expense           (2,946,430)            -                   -              -            -      (2,946,430)
     Equity in net income of subsidiaries  (1,270,897)            -             935,731              -      335,166               -
                                        -------------   -----------   -----------------   ------------   ----------    ------------

         Net income (loss)              $  (1,550,514)  $         -   $      (1,270,897)  $    935,731   $  335,166    $ (1,550,514)
                                        =============   ===========   =================   ============   ==========    ============
</TABLE>

                                      F-30
<PAGE>

Condensed consolidating statements of cash flows for the year ended December 31,
2001

<TABLE>
<CAPTION>
                                                              Majestic
                                             Majestic Star    Investor,  Majestic Investor    Guarantor   Eliminating  Consolidated
                                              Casino, LLC       LLC        Holdings, LLC    Subsidiaries    Entries        Total
                                            --------------  -----------  -----------------  ------------  -----------  ------------
<S>                                         <C>             <C>          <C>                <C>           <C>          <C>
NET CASH PROVIDED BY (USED IN)              $    8,840,041  $    18,500       ($14,700,259) $ 17,334,730  $   918,273  $ 12,411,285
OPERATING ACTIVITIES

CASH FLOWS FROM INVESTING ACTIVITIES:
   Payments for business acquired, net of
      cash acquired                                      -            -       (143,758,152)            -            -  (143,758,152)
   Acquisition of property and equipment        (4,967,152)           -                  -      (122,696)           -    (5,089,848)
   Decrease of prepaid lease and deposits        2,287,437            -                  -             -            -     2,287,437
   Purchase of naming rights                    (1,500,000)           -                  -             -            -    (1,500,000)
   Proceeds from sale of slot machine                1,850            -                  -             -            -         1,850
   Investment in Buffington Harbor
      Riverboats, LLC                             (214,665)           -                  -             -            -      (214,665)
   Decrease in restricted cash                           -    2,000,000                  -             -            -     2,000,000
                                            --------------  -----------  -----------------  ------------  -----------  ------------

   Net cash provided by (used in)
      investing activities                      (4,392,530)   2,000,000       (143,758,152)     (122,696)              (146,273,378)
                                            --------------  -----------  -----------------  ------------  -----------  ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from issuance of 11.653%
      Senior Secured Notes                               -            -        145,000,400             -            -   145,000,400
   Deferred financing costs                              -    1,465,860         (6,815,090)            -            -    (5,349,230)
   Member's equity contribution                          -            -          5,000,000             -            -     5,000,000
   Contribution from Majestic Investor                   -   (8,803,191)         8,803,191             -            -             -
   Cash received for loan to Barden
      Development, Inc.                                  -    2,000,000                  -             -            -     2,000,000
   Cash advances to/from related parties                 -     (250,000)         1,168,273             -     (918,273)            -
   Issuance of loan to Barden Development,
      Inc.                                               -            -           (700,000)            -            -      (700,000)
   Line of credit, net                          (7,800,000)           -          6,500,000             -            -    (1,300,000)
   Cash paid to reduce long-term debt             (977,716)           -                  -        (5,582)           -      (983,298)
                                            --------------  -----------  -----------------  ------------  -----------  ------------

   Net cash provided by (used in)
      financing activities                      (8,777,716)  (5,587,331)       158,956,774        (5,582)    (918,273)  143,667,872
                                            --------------  -----------  -----------------  ------------  -----------  ------------

NET INCREASE (DECREASE) IN CASH AND
  CASH EQUIVALENTS                              (4,330,205)  (3,568,831)           498,363    17,206,452            -     9,805,779

CASH AND CASH EQUIVALENTS BEGINNING
  OF YEAR                                       12,550,681    3,568,831                  -             -            -    16,119,512
                                            --------------  -----------  -----------------  ------------  -----------  ------------

CASH AND CASH EQUIVALENTS END OF
  YEAR                                      $    8,220,476  $         -  $         498,363   $17,206,452  $         -  $ 25,925,291
                                            ==============  ===========  =================  ============  ===========  ============
</TABLE>

                                      F-31
<PAGE>

Condensed consolidating balance sheets as of December 31, 2000

<TABLE>
<CAPTION>
                                                           Majestic Star,                             Eliminating     Consolidated
                                                           Casino, LLC      Majestic Investor, LLC       Entries          Total
                                                           -----------      ----------------------       -------          -----
<S>                                                        <C>              <C>                      <C>             <C>
ASSETS
CURRENT ASSETS:
     Cash and cash equivalents                             $ 12,550,681         $3,568,831           $         -     $  16,119,512
     Accounts receivable (net)                                2,041,077             18,500                     -         2,059,577
     Intercompany accounts                                      250,000           (250,000)                                      -
     Inventories                                                 53,479                  -                     -            53,479
     Prepaid expenses and other current assets                  636,337          4,000,000                     -         4,636,337
                                                           ------------         ----------           -----------     -------------

          Total current assets                               15,531,574          7,337,331                     -        22,868,905
                                                           ------------         ----------           -----------     -------------

Property, equipment, and vessel improvements, net            49,158,571                  -                     -        49,158,571

OTHER ASSETS:
     Investment in Buffington Harbor Riverboats, L.L.C.      43,924,033                  -                              43,924,033
     Investment in Majestic Investor                          8,803,191                  -            (8,803,191)                -
     Other assets and deposits                                9,179,940          1,465,860                     -        10,645,800
                                                           ------------         ----------           -----------     -------------

          Total other assets                                 61,907,164          1,465,860            (8,803,191)       54,569,833
                                                           ------------         ----------           -----------     -------------

          Total                                            $126,597,309         $8,803,191           $(8,803,191)    $ 126,597,309
                                                           ============         ==========           ===========     =============

LIABILITIES AND MEMBERS' EQUITY
CURRENT LIABILITIES:
     Current maturities of long-term debt                  $  8,811,719         $        -           $         -     $   8,811,719
     Accounts payable, accrued and other                     12,983,077                  -                     -        12,983,077
                                                           ------------         ----------           -----------     -------------

          Total current liabilities                          21,794,796                  -                     -        21,794,796
                                                           ------------         ----------           -----------     -------------

Long-term debt, net of current maturities                   128,233,486                  -                     -       128,233,486
                                                           ------------         ----------           -----------     -------------

          Total liabilities                                 150,028,282                  -                     -       150,028,282
                                                           ------------         ----------           -----------     -------------

MEMBERS' EQUITY (DEFICIT):                                  (23,430,973)         8,803,191            (8,803,191)      (23,430,973)
                                                           ------------         ----------           -----------     -------------

          Total                                            $126,597,309         $8,803,191            (8,803,191)    $ 126,597,309
                                                           ============         ==========           ===========     =============
</TABLE>

                                      F-32
<PAGE>

Condensed Consolidating Statements of Operations
for the Year Ended December 31, 2000

<TABLE>
<CAPTION>
                                                   Majestic Star
                                                    Casino, LLC           Majestic Investor, LLC       Consolidated Total
                                                   -----------           ----------------------       ------------------
<S>                                                <C>                   <C>                             <C>
OPERATING REVENUES:
     Casino                                        $115,455,271          $                   -           $115,455,271
     Food and beverage                                1,925,023                              -              1,925,023
     Other                                            1,070,965                              -              1,070,965
                                                   -------------         ----------------------          ------------

          Total revenue                             118,451,259                              -            118,451,259

          Less promotional allowance                 (5,017,777)                             -             (5,017,777)
                                                   -------------         ----------------------          ------------

          Net revenue                               113,433,482                              -            113,433,482
                                                   -------------         ----------------------          -----------

COSTS AND EXPENSES:
     Casino                                          21,179,612                              -             21,179,612
     Gaming and admission taxes                      32,350,368                              -             32,350,368
     Food and beverage                                2,402,518                              -              2,402,518
     Advertising and promotion                        8,019,655                              -              8,019,655
     General and administrative                      25,549,622                        250,226             25,799,848
     Economic incentive - City of Gary                3,230,679                              -              3,230,679
     Depreciation and amortization                    9,113,681                              -              9,113,681
     Loss on disposal of assets                         416,904                              -                416,904
                                                   -------------         ----------------------          ------------

          Total costs and expenses                  102,263,039                        250,226            102,513,265
                                                   -------------         ----------------------          ------------

          Operating income (loss)                    11,170,443                       (250,226)            10,920,217
                                                   -------------         ----------------------          ------------

Other income (expense):
     Interest income                                    840,536                         52,917                893,453'
     Interest expense                               (14,998,377)                             -            (14,998,377)
     Other non-operating expense                     (2,183,172)                             -             (2,183,172)
                                                   -------------         ----------------------          ------------

          Loss before extraordinary item             (5,170,570)                      (197,309)            (5,367,879)

Extraordinary Item:
     Loss on bond redemption                           (382,500)                             -               (382,500)
                                                   -------------         ----------------------          ------------

          Net (loss)                               $ (5,553,070)         $            (197,309)          $ (5,750,379)
                                                   ===================================================================
</TABLE>

                                      F-33
<PAGE>

Condensed consolidating statements of cash flows for
the year ended December 31, 2000

<TABLE>
<CAPTION>
                                                                   Majestic Star         Majestic          Consolidated
                                                                    Casino, LLC        Investor, LLC          Total
                                                                    ------------       ------------       ------------
<S>                                                                <C>                 <C>                <C>
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES                 $  6,178,381       $ (1,431,669)      $  4,746,712
                                                                    ------------       ------------       ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Acquisition of property, equipment and vessel improvements       (3,039,635)                --         (3,039,635)
     Sale of slot equipment                                              179,200                 --            179,200
     Increase in deposits                                                (98,404)                --            (98,404)
     Investment in Buffington Harbor Riverboats, L.L.C                (7,836,489)                --         (7,836,489)
     (Increase) in restricted cash                                            --         (2,000,000)        (2,000,000)
     Contribution to Majestic Investor, LLC                           (9,000,500)         9,000,500                 --
     Purchase of 49% interest in Gary New Century, LLC                        --         (9,000,000)        (9,000,000)
     Sale of 49% interest in Gary New Century, LLC                            --          9,000,000          9,000,000
                                                                    ------------       ------------       ------------

          Net cash (used in) provided by investing activities        (19,795,828)         7,000,500        (12,795,328)
                                                                    ------------       ------------       ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Redemption of 12-3/4% Senior Secured Notes                       (6,382,500)                --         (6,382,500)
     Dcrease in restricted cash                                        7,357,874                 --          7,357,874
     Distribution to Barden Development, Inc.                           (597,610)                --           (597,610)
     Line of credit, net                                               7,800,000                 --          7,800,000
     Cash paid to reduce long-term debt                               (2,154,680)                --         (2,154,680)
     Issuance of loans to Barden Development, Inc.                    (4,000,000)        (2,000,000)        (6,000,000)
     Cash received for loans to Barden Development, Inc.               4,000,000                 --          4,000,000
                                                                    ------------       ------------       ------------
          Net cash provided by (used in) financing activities          6,023,084         (2,000,000)         4,023,084
                                                                    ------------       ------------       ------------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                  (7,594,363)         3,568,831         (4,025,532)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                          20,145,044                 --         20,145,044
                                                                    ------------       ------------       ------------

CASH AND CASH EQUIVALENTS, END OF YEAR                              $ 12,550,681       $  3,568,831       $ 16,119,512
                                                                    ============       ============       ============
</TABLE>

                                      F-34
<PAGE>
                                                                     SCHEDULE II

                          THE MAJESTIC STAR CASINO, LLC
                        VALUATION AND QUALIFYING ACCOUNTS
                 FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000


<TABLE>
<CAPTION>
                                     Balance at    Charged to                                          Balance at
                                     beginning     costs and         Cash                                 end
Description                           of year       expenses        Recoveries        Deductions         of year
-------------------------------------------------------------------------------------------------------------------
<S>                                <C>            <C>              <C>               <C>               <C>
Allowance for doubtful accounts

Year ended December 31, 1999       $ 148,608      $  75,504        $  64,591         $  252,155        $  36,548

Year ended December 31, 2000          36,548        140,182           35,270             92,000          120,000

Year ended December 31, 2001         120,000        400,685           35,704            196,687          359,702
</TABLE>

                                      F-35
<PAGE>


                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Fitzgeralds Gaming Corporation:

     We have audited the accompanying combined balance sheets of Fitzgeralds Las
Vegas, Inc., Fitzgeralds Mississippi, Inc., and 101 Main Street Limited
Liability Company (collectively, the "Properties") (wholly owned subsidiaries of
Fitzgeralds Gaming Corporation, the "Parent") (Debtors-in-Possession) as of
December 6, 2001 and December 31, 2000, and the related combined statements of
operations, stockholder's deficiency, and cash flows for the period from January
1, 2001 through December 6, 2001 and for the years ended December 31, 2000 and
1999. Our audits also included the financial statement schedule of combined
valuation and qualifying accounts listed in the Index on page F-1. These
financial statements and financial statement schedule are the responsibility of
the Properties' management. Our responsibility is to express an opinion on these
financial statements and financial statement schedule based on our audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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, such combined financial statements present fairly, in all
material respects, the financial position of the Properties as of December 6,
2001 and December 31, 2000, and the results of their operations and their cash
flows for the period from January 1, 2001 through December 6, 2001 and for the
years ended December 31, 2000 and 1999 in conformity with accounting principles
generally accepted in the United States of America. Also, in our opinion, such
financial statement schedule, when considered in relation to the basic combined
financial statements taken as a whole, presents fairly in all material respects
the information set forth therein.

     As discussed in Note 2, the Properties have filed for reorganization under
Chapter 11 of the Federal Bankruptcy Code. The accompanying combined financial
statements do not purport to reflect or provide for the consequences of the
bankruptcy proceedings. In particular, such combined financial statements do not
purport to show (a) as to assets, their realizable value on a liquidation basis
or their availability to satisfy liabilities; (b) as to prepetition liabilities,
the amounts that may be allowed for claims or contingencies, or the status and
priority thereof; (c) as to stockholder accounts, the effect of any changes that
may be made in the capitalization of the Properties; or (d) as to operations,
the effect of any changes that may be made in their business.

     The accompanying combined financial statements have been prepared assuming
that the Properties will continue as a going concern. As discussed in Note 1 to
the combined financial statements, the Parent's event of default on its senior
secured registered notes, which are guaranteed by the Properties, along with the
Properties' recurring losses and stockholder's deficiency raise substantial
doubt about the Properties' ability to continue as a going concern. Parent
management's plans concerning these matters are discussed in Note 2. The
combined financial statements do not include adjustments that might result from
the outcome of this uncertainty.

     As discussed in Note 1, on December 6, 2001, the Parent sold substantially
all of the assets and related liabilities of the Properties.

     Our audits were conducted for the purpose of forming an opinion on the
basic combined financial statements taken as a whole. The supplemental combining
schedules on pages F-57 through F-65 are presented for purposes of additional
analysis of the basic combined financial statements rather than to present the
financial position, results of operations, and cash flows of the individual
properties, and are not a required part of the basic combined financial
statements. These schedules are the responsibility of the Properties'
management. Such schedules have been subjected to the auditing procedures
applied in our audit of the basic combined financial statements and, in our
opinion, are fairly stated in all material respects when considered in relation
to the basic combined financial statements taken as a whole.

/s/ DELOITTE & TOUCHE LLP

Las Vegas, Nevada
April 8, 2002

                                       F-36
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

         FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC. AND
                   101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                            COMBINED BALANCE SHEETS

<Table>
<Caption>
                                                              AT DECEMBER 31,   AT DECEMBER 6,
                                                                   2000              2001
                                                              ---------------   --------------
<S>                                                           <C>               <C>
                                            ASSETS
CURRENT ASSETS:
  Cash and cash equivalents.................................   $  2,840,011      $  3,762,566
  Accounts receivable, net..................................             --           225,495
  Prepaid expenses:
    Gaming taxes............................................        265,381           817,590
    Other...................................................        366,312           780,238
                                                               ------------      ------------
        Total current assets................................      3,471,704         5,585,889
                                                               ------------      ------------
OTHER ASSETS:
  Net assets held for sale..................................    143,342,890                --
  Restricted cash...........................................        500,000                --
  Accounts receivable -- related parties....................          5,309        16,762,294
  Other assets..............................................             --            25,000
                                                               ------------      ------------
        Total other assets..................................    143,848,199        16,787,294
                                                               ------------      ------------
TOTAL.......................................................   $147,319,903      $ 22,373,183
                                                               ============      ============
                    LIABILITIES AND STOCKHOLDER'S DEFICIENCY
LIABILITIES NOT SUBJECT TO COMPROMISE
  CURRENT LIABILITIES:
  Accounts payable..........................................   $         --      $    166,073
  Due to Majestic...........................................             --         3,800,000
  Accrued and other:
    Payroll and related.....................................        491,255           919,143
    Other...................................................             --           264,732
                                                               ------------      ------------
        Total current liabilities...........................        491,255         5,149,948
NOTES PAYABLE, related party................................             --           228,825
                                                               ------------      ------------
        Total liabilities not subject to compromise.........        491,255         5,378,773
LIABILITIES SUBJECT TO COMPROMISE...........................    225,873,496        70,680,462
                                                               ------------      ------------
        Total liabilities...................................    226,364,751        76,059,235
                                                               ------------      ------------
COMMITMENTS AND CONTINGENCIES (Notes 8 and 13)
STOCKHOLDER'S DEFICIENCY
  Common stock -- Fitzgeralds Mississippi, Inc., $.01 par
    value; 8,000,000 shares authorized; 8,000,000 shares
    issued and outstanding..................................         80,000            80,000
  Common stock -- Fitzgeralds Las Vegas, Inc., $.01 par
    value; 25,000 shares authorized; 10,000 shares issued
    and outstanding.........................................            100               100
  Additional paid-in-capital................................      7,586,667         7,586,667
  Accumulated deficit.......................................    (86,711,615)      (61,352,819)
                                                               ------------      ------------
        Total stockholder's deficiency......................    (79,044,848)      (53,686,052)
                                                               ------------      ------------
TOTAL.......................................................   $147,319,903      $ 22,373,183
                                                               ============      ============
</Table>

             See notes to historical combined financial statements.
                                       F-37
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

         FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC. AND
                   101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                       COMBINED STATEMENTS OF OPERATIONS

<Table>
<Caption>
                                                        FOR THE YEARS ENDED DECEMBER 31,    FOR THE PERIOD FROM
                                                        ---------------------------------   JANUARY 1, 2001 TO
                                                             1999               2000         DECEMBER 6, 2001
                                                        --------------     --------------   -------------------
<S>                                                     <C>                <C>              <C>
OPERATING REVENUES:
  Casino.............................................    $138,928,815       $148,776,855       $150,670,567
  Food and beverage..................................      18,729,064         19,586,213         18,365,243
  Rooms..............................................      16,293,618         16,600,072         15,042,200
  Other..............................................       3,285,207          3,530,032          3,545,338
                                                         ------------       ------------       ------------
         Total.......................................     177,236,704        188,493,172        187,623,348
    Less promotional allowances......................      24,460,048         28,755,624         29,964,002
                                                         ------------       ------------       ------------
         Net.........................................     152,776,656        159,737,548        157,659,346
                                                         ------------       ------------       ------------
OPERATING COSTS AND EXPENSES:
  Casino.............................................      64,146,974         69,113,279         69,757,787
  Food and beverage..................................      11,793,071         11,508,965         10,625,017
  Rooms..............................................      10,701,241         10,904,351          9,818,552
  Other..............................................       1,877,030          1,717,182          1,657,265
  Selling, general and administrative................      40,808,792         39,370,958         37,852,210
  Depreciation and amortization......................      11,726,085         11,687,964                 --
  Write-down of assets...............................              --                 --         13,005,582
  Reorganization items...............................              --             38,967        (10,499,075)
                                                         ------------       ------------       ------------
         Total.......................................     141,053,193        144,341,666        132,217,338
                                                         ------------       ------------       ------------
INCOME FROM OPERATIONS...............................      11,723,463         15,395,882         25,442,008
OTHER INCOME (EXPENSE):
  Interest income....................................         129,654            167,446             38,407
  Interest expense...................................        (210,314)           (71,382)           (39,959)
  Interest expense -- related party (contractual
    interest of $29,279,747 for the year ended
    December 31, 2000 and $28,549,207 for 2001)......     (27,989,851)       (26,031,023)                --
  Other, net.........................................          99,012              4,493            (81,660)
                                                         ------------       ------------       ------------
NET INCOME (LOSS)....................................    $(16,248,036)      $(10,534,584)      $ 25,358,796
                                                         ============       ============       ============
</Table>

             See notes to historical combined financial statements.
                                       F-38
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

         FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC. AND
                   101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                COMBINED STATEMENTS OF STOCKHOLDER'S DEFICIENCY

<Table>
<Caption>
                                         COMMON STOCK       ADDITIONAL                      TOTAL
                                      -------------------    PAID-IN     ACCUMULATED    STOCKHOLDER'S
                                       SHARES     AMOUNT     CAPITAL       DEFICIT       DEFICIENCY
                                      ---------   -------   ----------   ------------   -------------
<S>                                   <C>         <C>       <C>          <C>            <C>
BALANCE, JANUARY 1, 1999............  8,010,000   $80,100   $7,586,667   $(59,928,995)  $(52,262,228)
Net loss............................         --        --           --    (16,248,036)   (16,248,036)
                                      ---------   -------   ----------   ------------   ------------
BALANCE, DECEMBER 31, 1999..........  8,010,000    80,100    7,586,667    (76,177,031)   (68,510,264)
Net loss............................         --        --           --    (10,534,584)   (10,534,584)
                                      ---------   -------   ----------   ------------   ------------
BALANCE, DECEMBER 31, 2000..........  8,010,000    80,100    7,586,667    (86,711,615)   (79,044,848)
Net income..........................         --        --           --     25,358,796     25,358,796
                                      ---------   -------   ----------   ------------   ------------
BALANCE, DECEMBER 6, 2001...........  8,010,000   $80,100   $7,586,667   $(61,352,819)  $(53,686,052)
                                      =========   =======   ==========   ============   ============
</Table>

             See notes to historical combined financial statements.
                                       F-39
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                       COMBINED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                               FOR THE YEARS
                                                            ENDED DECEMBER 31,           FOR THE PERIOD
                                                        ---------------------------     JANUARY 1, 2001
                                                            1999           2000       TO DECEMBER 6, 2001
                                                        ------------   ------------   --------------------
<S>                                                     <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)...................................  $(16,248,036)  $(10,534,584)      $ 25,358,796
  Adjustments to reconcile net income (loss) to net
     cash provided by (used in) operating activities:
  Depreciation and amortization.......................    11,726,085     11,687,964                 --
     Write-down of assets.............................            --             --         13,005,582
     Gain on sale of assets to Majestic...............            --             --        (11,121,811)
     Reorganization items incurred in connection with
       Chapter 11 and related legal proceedings.......            --         38,967            622,736
     Other............................................       (58,032)        36,487            116,439
     Changes in working capital, net of assets sold
       and liabilities assumed:
     (Increase) decrease in accounts receivable,
       net............................................       136,090       (233,359)           (42,071)
     (Increase) decrease in inventories...............      (135,666)        98,529             66,048
     (Increase) decrease in prepaid expenses..........      (401,108)      (492,966)           255,985
     (Increase) decrease in other assets..............      (130,091)      (139,028)            27,115
     Increase (decrease) in accounts payable..........    (2,511,838)    (1,408,119)           240,806
     Increase in due to Majestic......................            --             --          3,800,000
     Increase (decrease) in accrued and other
       liabilities....................................       450,505     (2,124,978)           624,469
     Increase (decrease) in amounts due to related
       parties, net...................................    15,945,345     15,134,274        (40,404,341)
     Increase in liabilities subject to compromise....            --        106,677            149,835
                                                        ------------   ------------       ------------
     Net cash provided by (used in) operating
       activities before reorganization items.........     8,773,254     12,169,864         (7,300,412)
Reorganization items:
  Interest received on cash accumulated because of the
     bankruptcy proceedings...........................            --             --            171,442
  Professional fees paid for services rendered in
     connection with the bankruptcy proceedings.......            --             --            (38,392)
  Other reorganization items incurred in connection
     with Chapter 11 and related legal proceedings....            --        (38,967)          (755,786)
                                                        ------------   ------------       ------------
     Net cash provided by (used in) operating
       activities.....................................     8,773,254     12,130,897         (7,923,148)
                                                        ------------   ------------       ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from sale of assets........................        77,726          8,463             28,250
  Acquisition of property and equipment...............    (4,345,588)    (9,011,942)        (1,054,131)
                                                        ------------   ------------       ------------
     Net cash used in investing activities............    (4,267,862)    (9,003,479)        (1,025,881)
                                                        ------------   ------------       ------------
                                                                                            (continued)
</Table>

             See notes to historical combined financial statements.
                                       F-40
<PAGE>

<Table>
<Caption>
                                                               FOR THE YEARS
                                                            ENDED DECEMBER 31,           FOR THE PERIOD
                                                        ---------------------------     JANUARY 1, 2001
                                                            1999           2000       TO DECEMBER 6, 2001
                                                        ------------   ------------   --------------------
<S>                                                     <C>            <C>            <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of long-term debt.........................    (2,975,622)      (453,560)          (240,288)
                                                        ------------   ------------       ------------
  Net cash used in financing activities...............    (2,975,622)      (453,560)          (240,288)
                                                        ------------   ------------       ------------
NET INCREASE (DECREASE) IN CASH AND CASH
  EQUIVALENTS.........................................     1,529,770      2,673,858         (9,189,317)
CASH AND CASH EQUIVALENTS BEGINNING OF PERIOD.........     8,748,255     10,278,025          2,840,011
(INCREASE) DECREASE IN CASH AND CASH EQUIVALENTS
  INCLUDED IN NET ASSETS HELD FOR SALE................            --    (10,111,872)        10,111,872
                                                        ------------   ------------       ------------
CASH AND CASH EQUIVALENTS END OF PERIOD...............  $ 10,278,025   $  2,840,011       $  3,762,566
                                                        ============   ============       ============
</Table>

             See notes to historical combined financial statements.
                                       F-41
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                     NOTES TO COMBINED FINANCIAL STATEMENTS

1.  ORGANIZATION AND FINANCIAL STATEMENT PRESENTATION

     Fitzgeralds Las Vegas, Inc., Fitzgeralds Mississippi, Inc. and 101 Main
Street Limited Liability Company (collectively, the "Properties") are wholly
owned subsidiaries of Fitzgeralds Gaming Corporation (the "Parent")
(Debtors-in-Possession). Until December 6, 2001 the Properties owned and
operated the Fitzgeralds-brand casino-hotels in downtown Las Vegas, Nevada
("Fitzgeralds Las Vegas"), Tunica, Mississippi ("Fitzgeralds Tunica"), and Black
Hawk, Colorado ("Fitzgeralds Black Hawk"). On December 6, 2001, the Parent sold
substantially all of the assets and related liabilities of Fitzgeralds Las
Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk to Majestic Investor
Holdings, LLC ("Majestic"). The Properties are marketed primarily to
middle-market customers, emphasizing their Fitzgeralds brand and their
"Fitzgeralds Irish Luck" theme.

     As described in Note 13, the Properties are guarantors, and substantially
all of their assets serve as collateral, under various debt agreements that the
Parent has entered into with outside lenders. The Parent generated net income
during 2001 and experienced net losses during 2000 and 1999, is highly
leveraged, and has a stockholders' deficiency at December 6, 2001 and at the end
of 2000.

     On May 13, 1999, the Parent's Board of Directors determined that, pending a
restructuring of its indebtedness, it would not be in the best interest of the
Parent to make the regularly scheduled interest payments on its 10 7/8% senior
secured registered notes due 2004 (the "Notes"). Accordingly, the Parent has not
paid the regularly scheduled interest payments of $12.5 million that were due
and payable on June 15, 1999, December 15, 1999 and June 15, 2000. Accordingly,
an event of default under the indenture (the "Indenture"), dated December 30,
1997, governing the Notes occurred on July 15, 1999, and continued until the
Parent and the Properties filed a petition for relief under Chapter 11 of the
Bankruptcy Code (the "Petition"). The Parent's contractual interest on the Notes
was $31,390,852 for the period from January 1, 2001 through December 6, 2001 and
was $33,699,003 for the year ended December 31, 2000. No action has been taken
by either the Indenture trustee or the holders of at least 25 percent of the
Notes, as permitted under the Indenture, to accelerate the Notes and declare the
unpaid principal and interest to be due and payable. Failure to make the
scheduled payment on June 15, 1999 resulted in a 1 percent increase in the
interest rate to 13.25 percent, effective June 16, 1999 until the Parent and the
Properties filed the Petition. In accordance with the Indenture, the Parent
began accruing interest on the unpaid interest at 13.25 percent, effective June
16, 1999 until the Parent and the Properties filed the Petition. See Note 2.

     The accompanying financial statements have been prepared on a going concern
basis. Such 2001 financial statements are as of and for the period ended
December 6, 2001, the date of the sale of substantially all of the assets and
related liabilities of the Properties to Majestic. At December 6, 2001,
stockholder's deficiency was $53.7 million. The Parent's inability to meet the
interest payments on the Notes, which are guaranteed by the Properties, along
with the Properties' recurring losses in prior years and stockholder's
deficiency, raise substantial doubt about their ability to continue as a going
concern.

2.  PETITION FOR RELIEF UNDER CHAPTER 11

  GENERAL

     On December 5, 2000, the Parent and the Properties commenced cases under
Chapter 11 of the Bankruptcy Code (collectively, the "Bankruptcy Cases") in the
United States Bankruptcy Court for the Northern District of Nevada (the
"Bankruptcy Court"). The Bankruptcy Cases are jointly administered and
coordinated under Case No. BK-N-00-33467 GWZ. The Bankruptcy Cases were
commenced in accordance

                                       F-42
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

with an Agreement Regarding Pre-Negotiated Restructuring, dated as of December
1, 2000 (the "Restructuring Agreement"), with the holders (the "Consenting
Noteholders") of a majority in interest of the Notes. The Restructuring
Agreement contemplates an expeditious and orderly sale of all of the Parent's
operating assets and properties as going concerns.

     Under the terms of the Restructuring Agreement, the Parent is required to
seek buyers for each of its operating businesses. In order to effectuate this
liquidation, the Parent commenced the Bankruptcy Cases and has received approval
from the Bankruptcy Court to sell its operating businesses through negotiated
sales agreements either by way of motion to sell free and clear of liens under
section 363 of the Bankruptcy Code, or under one or more plans of
reorganization.

     As part of the restructuring contemplated in the Restructuring Agreement,
the Parent, as debtor-in-possession, sought and obtained Bankruptcy Court
approval to: (i) sell free and clear of liens pursuant to section 363 of the
Bankruptcy Code substantially all of its assets; and (ii) assume and assign
pursuant to section 365 of the Bankruptcy Code contracts used in its operations
in Las Vegas, Nevada, Black Hawk, Colorado and Tunica, Mississippi to an
affiliate of The Majestic Star Casino, LLC, an Indiana limited liability company
("Majestic"), pursuant to a Purchase and Sale Agreement, dated as of November
22, 2000, as amended on December 4, 2000 and November 1, 2001 (the "Purchase
Agreement"). On March 19, 2001, the Bankruptcy Court entered an order approving
the Purchase Agreement with Majestic.

     The Restructuring Agreement provides a vehicle for liquidating the assets
of the Parent in the Bankruptcy Court through Chapter 11 of the Bankruptcy Code.
Upon execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Parent distributed $13.0 million in Excess Cash (as that
term is defined in the Restructuring Agreement) to the trustee under the
Indenture (the "Indenture Trustee") to be applied to unpaid and accrued
Indenture Trustee's fees and expenses incurred and as partial payment of accrued
and unpaid interest and principal as provided in the Indenture. Pursuant to the
Restructuring Agreement and an order entered by the Bankruptcy Court, the Parent
was required to distribute unrestricted cash (which includes cash in net assets
held for sale) in excess of $24.8 million to holders of its Notes within 45 days
after the end of each quarter. In May, August and November 2001, the Parent
distributed $1.8 million, $7.7 million and $7.2 million, respectively, in Excess
Cash to the Indenture Trustee to be applied to accrued and unpaid interest and
principal as provided in the Indenture. On December 6, 2001, approximately
$133.3 million was distributed to the Indenture Trustee from the proceeds of the
December 6, 2001 sale to Majestic. The Parent and the Informal Committee are
currently engaged in discussions to establish a new threshold for cash reserves
subsequent to the December 6, 2001 sale to Majestic. As part of the
Restructuring Agreement, the Consenting Noteholders and the Indenture Trustee
agree to forbear from exercising certain of their rights otherwise allowable
under the Notes and the Indenture.

     The parties to the Restructuring Agreement have each concluded that the
fair market value of the Parent's real and personal property given as collateral
for the Notes is less than the total outstanding principal and interest due
under the Notes, and that the fair market value of the real and personal
property not securing the Notes is less than the amount of the unsecured
deficiency claim of the holders of the Notes. As a result, it is not expected
that any distribution will be made to holders of the existing capital stock of
the Parent or the Properties. The Restructuring Agreement requires that as part
of the liquidation process, all of the existing common stock of Fitzgeralds
Tunica and Fitzgeralds Las Vegas is to be canceled and extinguished without
payment therefor.

     Under the terms of the Restructuring Agreement, upon the closing of each
sale of the Parent's assets, the net proceeds of the collateral for the Notes,
less certain reserves for management incentives and other liabilities, must be
distributed to the Indenture Trustee for the benefit of and distribution to the
holders of the Notes in accordance with the Indenture. All of the Parent's
assets remaining after such sales, including any registered notes received as
part of the consideration for the sales of the Parent's assets and payment of

                                       F-43
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

remaining liabilities of the Parent, will be transferred to a liquidating trust
created for the benefit of the holders of the Notes and others under the terms
of the Restructuring Agreement.

     In light of the regulatory approvals needed to accomplish the liquidations,
and recognizing the need to retain senior management in order to insure
continuity and compliance with all gaming regulations and licensing requirements
in the Parent's operations during the process, the Restructuring Agreement
required implementation of a senior management incentive and retention program.
After obtaining Bankruptcy Court approval in December 2000, this program was
adopted by the Parent in order to retain Philip D. Griffith, Michael E.
McPherson, Max L. Page and Paul H. Manske (the "Senior Management"), each an
officer, director and/or senior executive of the Parent, as key executives and
to compensate them for their continued employment with the Parent during the
process.

     Pursuant to the Purchase Agreement, the Parent has agreed to: (i) sell free
and clear of liens pursuant to section 363 of the Bankruptcy Code substantially
all of the Properties' assets; and (ii) assume and assign pursuant to section
365 of the Bankruptcy Code contracts used in its operations at the Properties,
as well as the Parent's interest in the Fremont Street Experience Limited
Liability Company (collectively, the "Assets") to Majestic for $149.0 million in
cash, subject to certain holdbacks and adjustments, plus the assumption of
certain liabilities relating to the Assets.

     The transactions contemplated by the Purchase Agreement were consummated on
December 6, 2001. The purchase price for the Assets was $149.0 million, subject
to certain adjustments and holdbacks specified in the Purchase Agreement, which
resulted in net proceeds prior to distributions of approximately $146.9 million.
Of such amount, $7.7 million was retained by the Parent for cash reserves,
approximately $5.9 million was distributed to Senior Management, in
consideration of non-competition and sales incentives pursuant to the
Restructuring Agreement, and approximately $133.3 million was distributed to
holders of the Notes (on account of the $205.0 million aggregate principal
amount of Notes outstanding and approximately $44.8 million in accrued
pre-petition interest). In addition, during 2001 the Parent distributed
approximately $16.8 million to holders of the Notes in accordance with the
provisions of the Restructuring Agreement.

  REORGANIZATION ITEMS

     For the period from January 1, 2001 through December 6, 2001 and for the
year ended December 31, 2000, the Properties incurred the following expenses
subsequent to the filing of the Bankruptcy Cases:

<Table>
<Caption>
                                                               2000         2001
                                                              -------   ------------
<S>                                                           <C>       <C>
Reorganization items:
  Post-petition professional fees...........................  $    --   $     38,392
  Pre-petition expenses recorded post-petition..............   38,967             --
  U.S. trustee fees.........................................       --        120,000
  Other.....................................................       --        635,786
  Gain on sale of assets to Majestic........................       --    (11,121,811)
  Interest earned on accumulated cash resulting from the
     bankruptcy proceedings.................................       --       (171,442)
                                                              -------   ------------
                                                              $38,967   $(10,499,075)
                                                              =======   ============
</Table>

                                       F-44
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

  LIABILITIES SUBJECT TO COMPROMISE

     At December 6, 2001 and December 31, 2000, liabilities subject to
compromise consisted of the following:

<Table>
<Caption>
                                                                  2000          2001
                                                              ------------   -----------
<S>                                                           <C>            <C>
Liabilities subject to compromise:
  Due to related parties....................................  $225,774,418   $70,414,353
  Unsecured creditors.......................................        99,078       266,109
                                                              ------------   -----------
                                                              $225,873,496   $70,680,462
                                                              ============   ===========
</Table>

3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Combined Financial Statements -- The combined financial statements of the
Properties include the accounts of Fitzgeralds Las Vegas, Inc., Fitzgeralds
Mississippi, Inc. and 101 Main Street Limited Liability Company. All
inter-company balances and transactions have been eliminated.

     Cash and Cash Equivalents -- Cash includes cash required for gaming
operations. The Properties consider cash equivalents to include short-term
investments with original maturities of ninety days or less at the date of
purchase.

     Inventories -- Inventories consist principally of food and beverage and
operating supplies and are stated at the lower of first-in, first-out cost or
market.

     The estimated cost of normal operating quantities (base stock) of china,
silverware, glassware, linen, uniforms and utensils has been recorded as an
asset and is not being depreciated. Costs of base stock replacements are
expensed as incurred.

     Property and Equipment -- Property and equipment are stated at cost.
Depreciation and amortization are computed using the straight-line method over
the estimated service lives of the assets. Leasehold improvements are amortized
over the life of the lease or the life of the asset, whichever is shorter. Costs
of major improvements are capitalized; costs of normal repairs and maintenance
are charged to expenses as incurred. Gains or losses on disposals are
recognized. Certain of the assets of the Properties were classified as held for
sale upon consummation of the Purchase Agreement with Majestic in accordance
with Statement of Financial Accounting Standards ("SFAS") No. 121, Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of. This standard requires that assets to be disposed of shall be reported at
the lower of carrying amount or fair value less costs to sell and shall not be
depreciated or amortized while they are held for disposal. The Properties
discontinued recording depreciation and amortization expense on property and
equipment subsequent to the filing of the Bankruptcy Cases and consummation of
the Purchase Agreement with Majestic based on the requirements of SFAS No. 121.

     Restricted Cash -- At December 31, 2000, restricted cash represents U.S.
Treasury Notes of $1,000,000 held in an escrow account for the benefit of
certain land lessors related to Fitzgeralds Las Vegas. In 2000, $500,000 of this
amount was reclassified as net assets held for sale. See Note 6.

     Goodwill -- Goodwill represents the cost in excess of fair value of the net
assets acquired in purchase transactions. Goodwill is being amortized using the
straight-line method over 40 years and is recorded net of accumulated
amortization. The Properties discontinued the amortization of their goodwill
included in net assets held for sale subsequent to the filing of the Bankruptcy
Cases on December 5, 2000. Furthermore, the Company wrote down $13.0 million of
the asset as of December 6, 2001 due to the sale of Fitzgeralds Black Hawk to
Majestic.

                                       F-45
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     Revenue Recognition -- Casino revenue is the net win from gaming
activities, which is the difference between gaming wins and losses. The majority
of our casino revenue is counted in the form of cash, chips and tokens and
therefore is not subject to any significant or complex estimation procedures.
Food and beverage and room revenues are recognized at retail value at the time
the related service is performed.

     Operating revenues include the retail value of rooms, food and beverage,
and other items provided to customers without charge; corresponding charges have
been deducted from revenue in the accompanying combined statements of operations
as promotional allowances in the determination of net operating revenues.
Promotional allowances also include cash-back incentives earned in our Slot
Club. The Properties provide cash-back incentives to patrons who earn a
percentage of their cash wagered using their slot card provided by the
Properties.

     The retail value of the complimentaries and the cash-back incentives
included in promotional allowances are as follows:


<Table>
<Caption>
                                                   1999          2000          2001
                                                -----------   -----------   -----------
<S>                                             <C>           <C>           <C>
Hotel rooms...................................  $ 4,509,181   $ 4,863,935   $ 4,527,788
Food and beverage.............................    9,849,482    10,831,067    10,401,400
Other.........................................      498,476       756,761       819,329
Cash-back incentives..........................    9,602,909    12,303,861    14,215,485
                                                -----------   -----------   -----------
                                                $24,460,048   $28,755,624   $29,964,002
                                                ===========   ===========   ===========
</Table>

     The estimated costs of providing the complimentary services are charged to
the casino department and are as follows:

<Table>
<Caption>
                                                   1999          2000          2001
                                                -----------   -----------   -----------
<S>                                             <C>           <C>           <C>
Hotel rooms...................................  $ 2,441,182   $ 2,528,282   $ 2,925,396
Food and beverage.............................   10,141,593    10,935,259    10,638,710
Other.........................................      280,998       524,426       572,390
                                                -----------   -----------   -----------
                                                $12,863,773   $13,987,967   $14,136,496
                                                ===========   ===========   ===========
</Table>

     Advertising Costs -- Advertising expenditures are expensed in the period
the advertising initially takes place. Advertising costs included in selling,
general and administrative expenses were $3,860,890 and $3,649,524 for the years
ended December 31, 1999 and 2000, respectively and $3,157,440 for the period
from January 1, 2001 through December 6, 2001.

     Federal Income Taxes -- The Properties account for income taxes in
accordance with SFAS No. 109, Accounting for Income Taxes, which requires
recognition of deferred tax assets and liabilities for the expected future tax
consequences of events that have been included in the financial statements or
tax returns. Deferred income taxes reflect the net tax effects of (a) temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes, and (b)
operating loss and tax credit carryforwards.

     101 Main Street Limited Liability Company is a limited liability company
formed under the laws of the state of Colorado, and, as such, is classified as a
partnership for federal income tax purposes. Accordingly, no provision for
federal or state income taxes was recorded because any taxable income or loss is
included in the corporate income tax return of the Parent.

     Financial Reporting Period -- The Properties have adopted a "4-4-5" (weeks)
financial reporting period which maintains a December 31 year-end. This method
of reporting results in 13 weeks in each quarterly accounting period. The first
and fourth accounting periods will have a fluctuating number of days resulting
from the maintenance of a December 31 year-end, whereas the second and third
periods will have the same number of days each year.

     Fair Value of Financial Instruments -- The Properties believe, based on
current information, that the carrying value of the Properties' cash and cash
equivalents, restricted cash, accounts receivable, advances, and accounts
payable approximates fair value because of the short maturity of those
instruments.

     Impairment of Long Lived Assets -- The Properties review long-lived assets
and certain identifiable intangibles for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. If the sum of the expected future cash flows, undiscounted and
without interest charges, is less than the carrying amount of the asset, an
impairment charge is recognized in the amount by which the carrying value of the
asset exceeds its fair market value. The fair value of assets is determined
using the present value of the estimated future cash flows or the expected
selling price less selling costs for assets expected to be disposed of.

                                       F-46
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     Recently Issued Accounting Standards -- On June 30, 1998, the Financial
Accounting Standards Board ("FASB") issued SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities. This statement establishes
accounting and reporting standards for derivative instruments and hedging
activities and is effective for the period ended December 6, 2001. Adoption of
this statement did not have a material impact on the Properties' financial
condition or results of operation.

     On January 1, 2001, the Properties implemented Emerging Issues Task Force
("EITF") No. 00-14 Accounting for Certain Sales Incentives, EITF No. 00-21,
Accounting for Multiple-Element Revenue Arrangements, EITF No. 00-22, Accounting
for "Points" and Certain Other Time-Based or Volume-Based Sales Incentive
Offers, and Offers for Free Products or Services to Be Delivered in the Future,
and EITF No. 00-25, Accounting for Consideration from a Vendor to a Retailer in
Connection with the Purchase or Promotion of the Vendor's Products, requiring
cash coupons or rebates to be classified as a reduction of revenue. Prior to
implementation, the Properties had expensed the cash coupons, players club
reward program and other cash back programs as a casino or marketing expense. In
2001, the Properties reclassified their 2000 and 1999 statements of operations
to reflect such expenses as promotional expense thereby reducing net revenue.
This reclassification did not have any effect on the Properties' income from
operations and net income for the current year and previously reported net
losses.

     In June 2001, the FASB issued Statement of Financial Accounting Standards
No. 141 ("SFAS 141"), Business Combinations, which requires the purchase method
of accounting for business combinations initiated after June 30, 2001 and
prohibits the use of the pooling-of-interest method. The Properties do not
believe that the adoption of SFAS 141 will have a significant impact on their
financial statements.

     In June 2001, the FASB issued Statement of Financial Accounting Standards
No. 142 ("SFAS 142") Goodwill and Other Intangible Assets, which is effective
January 1, 2002. SFAS 142 requires that goodwill and other intangible assets
with indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually. The Properties discontinued recording the
amortization of goodwill included in net assets held for sale subsequent to
filing the Bankruptcy Cases. Amortization expense related to goodwill was $0.3
million for 2000. As of December 6, 2001, the Properties wrote-down $13.0
million of goodwill due to the sale of Fitzgeralds Black Hawk to Majestic.

     Also, in June 2001, the FASB issued Statement of Financial Accounting
Standards No. 143, Accounting for Asset Retirement Obligations, which is
effective for financial statements issued for fiscal years beginning after June
15, 2002. This statement establishes accounting standards for recognition and
measurement of a liability for an asset retirement obligation and the associated
asset retirement cost. The Properties are currently evaluating the impact that
this standard will have on its financial condition and results of operations.

     In August 2001, the FASB issued Statement of Financial Accounting Standards
No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, which
is effective for financial statements issued for fiscal years beginning after
December 15, 2001, and the interim periods within those fiscal years. This
statement addresses financial accounting and reporting for the impairment of
long-lived assets and for long-lived assets to be disposed of, and supersedes
Statement of Financial Accounting Standards No. 121, Accounting for the
Impairment of Long-Lived Assets and For Long-Lived Asset to be Disposed of. The
Properties are currently evaluating the impact that this standard will have on
its financial condition and results of operations.

     Bankruptcy Related Accounting -- The Properties have accounted for all
transactions related to the Bankruptcy Cases in accordance with Statement of
Position 90-7 ("SOP 90-7"), Financial Reporting by Entities in Reorganization
Under the Bankruptcy Code, which was issued by the American Institute of
Certified Public Accountants in November 1990. Accordingly, liabilities subject
to compromise under the Bankruptcy Cases have been segregated on the Combined
Balance Sheets and are recorded for the amounts that are expected to be allowed
under the Restructuring Agreement (see Note 2). In addition, the Combined

                                       F-47
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Statements of Operations and the Combined Statements of Cash Flows for the year
ended December 31, 2000 and for the period from January 1, 2001 through December
6, 2001 disclose expenses related to the Bankruptcy Cases under "Reorganization
Items." The Properties will continue to present their Combined Statements of
Cash Flows using the indirect method.

     Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of certain assets and
liabilities at the date of the financial statements. These estimates also affect
the disclosure of contingent liabilities at the date of the financial statements
and the reported amounts of certain revenues and expenses during the reporting
period. Actual results could differ from those estimates.

     Reclassifications -- Certain amounts in the 1999 and 2000 combined
financial statements have been reclassified to conform to the 2001 method of
presentation.

4.  STATEMENTS OF CASH FLOWS INFORMATION

     The following supplemental disclosure is provided as part of the Combined
Statements of Cash Flows for the years ended December 31, 1999 and 2000 and for
the period from January 1, 2001 through December 6, 2001:

     Cash paid for interest, net of amounts capitalized, during the years ended
December 31, 1999 and 2000 and for the period from January 1, 2001 through
December 6, 2001 was $225,072, $67,600 and $48,824, respectively.

     Certain non-cash operating, investing and financing activities were as
follows:

     Long-term contracts payable of $368,888 in 1999 and $368,420 in 2000 were
incurred with the acquisition of new equipment. In 2001, no additional new
equipment was acquired through long-term contracts payable.

     See Note 2 and Note 6 for a summary of Liabilities Subject to Compromise
and Net Assets Held for Sale.

5.  PROPERTY AND EQUIPMENT

     Property and equipment consists of the following at December 31, 2000 and
December 6, 2001:

<Table>
<Caption>
                                                                               ESTIMATED
                                                          2000        2001    SERVICE LIFE
                                                      -------------   -----   ------------
<S>                                                   <C>             <C>     <C>
Land used in casino operations......................  $  10,748,949   $ --             --
Buildings and improvements..........................     94,646,085     --     7-40 years
Site improvements...................................     20,930,897     --       20 years
Barge and improvements..............................     12,896,235     --       15 years
Furniture, fixtures and equipment...................     55,288,988     --     3-12 years
                                                      -------------   -----
                                                        194,511,154     --
Less accumulated depreciation and amortization......    (70,612,350)    --
                                                      -------------   -----
                                                        123,898,804     --
Construction in progress............................        760,878     --
                                                      -------------   -----
                                                        124,659,682     --
Less net assets held for sale.......................   (124,659,682)    --
                                                      -------------   -----
Total...............................................  $          --   $ --
                                                      =============   =====
</Table>

                                       F-48
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     Substantially all property and equipment is pledged as collateral on the
Parent's long-term debt.

6.  NET ASSETS HELD FOR SALE

     On December 1, 2000, the Parent entered into the Restructuring Agreement
with the Consenting Noteholders. The Restructuring Agreement contemplates an
expeditious and orderly sale of all of the Parent's operating assets and
properties. The transactions contemplated by the Purchase Agreement were
consummated on December 6, 2001. The purchase price for the Assets was $149.0
million, subject to certain adjustments and holdbacks specified in the Purchase
Agreement, which resulted in net proceeds prior to distributions of
approximately $146.9 million.

     The components of the net assets held for sale as of December 31, 2000 are
as follows:

<Table>
<Caption>
                                  FITZGERALDS   FITZGERALDS   FITZGERALDS
                                   LAS VEGAS      TUNICA      BLACK HAWK       TOTAL
                                  -----------   -----------   -----------   ------------
<S>                               <C>           <C>           <C>           <C>
Assets:
  Cash and cash equivalents.....  $ 3,082,396   $ 5,274,598   $ 1,754,878   $ 10,111,872
  Accounts receivable, net of
     allowance for doubtful
     accounts of $210,586.......      696,054       539,510        55,420      1,290,984
  Inventories...................      445,572       445,722       153,204      1,044,498
  Prepaid gaming taxes..........      566,788            --        48,052        614,840
  Other current assets..........    1,506,705       366,376       109,802      1,982,883
  Property and equipment, net...   37,162,537    62,708,013    24,789,132    124,659,682
  Goodwill, net of accumulated
     amortization of
     $1,173,579.................           --            --    13,005,582     13,005,582
  Restricted cash...............      500,000            --            --        500,000
  Other non-current assets......      320,251       461,361       141,363        922,975
  Current portion of long term
     debt.......................     (167,273)      (73,015)           --       (240,288)
  Accounts payable..............     (514,831)     (809,013)     (227,676)    (1,551,520)
Accrued expenses:
  Payroll and related...........   (1,336,852)   (2,349,516)     (667,094)    (4,353,462)
  Progressive jackpots..........     (269,561)     (322,665)     (387,602)      (979,828)
  Outstanding chips and
     tokens.....................     (104,175)      (91,247)      (39,152)      (234,574)
  Other.........................     (788,550)   (1,095,992)   (1,152,148)    (3,036,690)
Long-term debt..................     (394,064)           --            --       (394,064)
                                  -----------   -----------   -----------   ------------
                                  $40,704,997   $65,054,132   $37,583,761   $143,342,890
                                  ===========   ===========   ===========   ============
</Table>

                                       F-49
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

7.  LONG-TERM DEBT

     Long-term debt outstanding at December 31, 2000 and December 6, 2001 is as
follows:

<Table>
<Caption>
                                                                2000      2001
                                                              ---------   -----
<S>                                                           <C>         <C>
Contracts payable secured by certain equipment due in
  maximum aggregate monthly installments of $32,842, with
  varying maturity dates through 2005.......................  $ 634,352   $  --
                                                              ---------   -----
Total debt..................................................    634,352      --
Less net assets held for sale...............................   (634,352)     --
                                                              ---------   -----
Long-term debt..............................................  $      --   $  --
                                                              =========   =====
</Table>

8.  COMMITMENTS

     Operating Leases -- In connection with the sale of assets to Majestic, the
Properties' commitments under operating leases were assumed by Majestic.

     Such operating lease commitments primarily related to equipment, signs,
warehouses and ground leases on which the Properties' buildings and equipment
reside. Rent expense for the years ended December 31, 1999 and 2000 was
$2,183,428 and $1,732,028, respectively and for the period from January 1, 2001
through December 6, 2001 was $1,164,417.

     Employment Agreements -- Consistent with industry practice, the Properties
have entered into employment agreements with certain of their executives and
departmental directors. In accordance with the Restructuring Agreement, the
Properties have agreed not to assume these employment agreements as provided in
Section 365 of the Bankruptcy Code.

9.  RELATED PARTY TRANSACTIONS

     Amounts due to/from the Parent and other wholly owned subsidiaries of the
Parent at December 6, 2001 includes receivables for $16,762,294, registered
notes payable of $70,414,353 and notes payable of $228,825. Amounts due to/from
the Parent and other wholly owned subsidiaries of the Parent at December 31,
2000 include receivables for $5,309 and registered notes payable of
$225,774,418. The registered notes due to Parent have an effective interest rate
of approximately 15.0 percent for 2001 and 2000 and are due December 15, 2004,
the due date of the Notes. Accounts receivable -- related parties of $16,762,294
at December 6, 2001 represents advances made to the Parent by the Properties.
These advances will be used to offset the notes due to the Parent as described
above.

     During the period from January 1, 2001 through December 6, 2001 and during
the years ended December 31, 2000 and 1999, the Parent allocated approximately
$1,000,000 to Fitzgeralds Las Vegas, Fitzgeralds Tunica, and Fitzgeralds Black
Hawk for corporate overhead allocations. These costs are accounted for as
general and administrative expenses. These corporate overhead allocations have
been made in order that the Properties absorb a portion of the expenses incurred
by the Parent on their behalf including, but not limited to, internal audit,
risk management, legal and corporate accounting services. The allocation method
used is based on an equal distribution to each of the Fitzgeralds operating
properties. Management believes that the allocation method used is reasonable.
Specific identification of these expenses to each of the properties is not
practicable.

                                       F-50
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

10.  PROFIT SHARING PLAN

     The Parent has a contributory profit-sharing plan for eligible employees.
The Parent's contribution to the plan for any year, as determined by the Board
of Directors, is discretionary. Contributions to the plan are allocated among
eligible participants in the proportion of their salaries to the total salaries
of all participants.

     The Parent amended the plan to include a 401(k) savings plan whereby
eligible employees may contribute up to 20% of their salary, which is matched by
the Properties at 25 cents per employee dollar contributed, up to a maximum of
6% of their salary. The Properties' matching contributions were $218,912 and
$221,140 for the years ended December 31, 1999 and 2000 and $231,975 for the
period from January 1, 2001 through December 6, 2001.

     Each employee age 21 or older completing 1,000 or more hours of service
during the twelve-month period preceding the entry dates, January 1, April 1,
July 1 or October 1, is eligible to participate in the plan.

     In addition, the Properties contribute to multi-employer defined
contribution pension plans under various union agreements. Contributions, based
on wages paid to covered employees, were $537,998 and $351,847 for the years
ended December 31, 1999 and 2000 and $342,172 for the period from January 1,
2001 through December 6, 2001.

11.  STOCKHOLDER'S DEFICIENCY

     The Restructuring Agreement requires that all of the existing common stock
of Fitzgeralds Tunica and Fitzgeralds Las Vegas be canceled and extinguished
without payment therefor. It is not expected that any distribution will be made
to holders of the existing capital stock of the Properties.

     As stated above, 101 Main Street Limited Liability Company is a limited
liability company formed under the laws of the state of Colorado. Included in
total stockholder's deficiency on the combined balance sheets is a total
member's equity of $4,663,213 as of December 6, 2001 and total member's
deficiency of $2,331,468 as of December 31, 2000 for 101 Main Street Limited
Liability Company.

12.  INCOME TAXES

     The Properties are included in Fitzgeralds Gaming Corporation's
consolidated tax return. The information below appears as if the Properties were
filing separate tax returns.

     A reconciliation of the income tax benefit with amounts determined by
applying the statutory U.S. Federal income tax rate to combined income (loss)
before taxes is as follows:

<Table>
<Caption>
                                                   1999          2000          2001
                                                -----------   -----------   -----------
<S>                                             <C>           <C>           <C>
Tax benefit at U.S. statutory rate............  $ 5,524,332   $ 3,687,104   $(8,774,424)
(Increase) decrease in valuation allowance....   (5,489,867)   (3,553,559)    8,738,172
Other.........................................      (34,465)     (133,545)       36,252
                                                -----------   -----------   -----------
Total.........................................  $        --   $        --   $        --
                                                ===========   ===========   ===========
</Table>

                                       F-51
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     The following summarizes the effect of deferred income tax items and the
impact of "temporary differences" between amounts of assets and liabilities for
financial reporting purposes and such amounts as measured by tax laws.

     The tax items comprising the Properties' net deferred tax asset as of
December 31, 2000 are as follows:

<Table>
<Caption>
                                                CURRENT     NONCURRENT       TOTAL
                                               ---------   ------------   ------------
<S>                                            <C>         <C>            <C>
Deferred tax assets:
  Accrued and other liabilities..............  $ 588,486   $         --   $    588,486
  Bad debt reserve...........................     31,285             --         31,285
  FICA credits not utilized..................         --        400,836        400,836
  NOL carryforward...........................         --     25,795,441     25,795,441
  Other......................................         --         66,826         66,826
                                               ---------   ------------   ------------
                                                 619,771     26,263,103     26,882,874
                                               ---------   ------------   ------------
Deferred tax liabilities:
  Difference between book and tax basis of
     property................................         --     (4,548,554)    (4,548,554)
  Intangibles................................         --       (710,827)      (710,827)
  Deferred state taxes.......................         --     (5,552,056)    (5,552,056)
  Prepaid expenses...........................   (681,523)            --       (681,523)
  Differences from flow through entity.......         --        (98,482)       (98,482)
                                               ---------   ------------   ------------
                                                (681,523)   (10,909,919)   (11,591,442)
                                               ---------   ------------   ------------
                                                 (61,752)    15,353,184     15,291,432
Less: valuation allowance....................     61,752    (15,353,184)   (15,291,432)
                                               ---------   ------------   ------------
Net..........................................  $      --   $         --   $         --
                                               =========   ============   ============
</Table>

     The tax items comprising the Properties' net deferred tax asset as of
December 6, 2001 are as follows:

<Table>
<Caption>
                                                  CURRENT    NONCURRENT       TOTAL
                                                 ---------   -----------   -----------
<S>                                              <C>         <C>           <C>
Deferred tax assets:
  Accrued and other liabilities................  $ 101,787   $        --   $   101,781
  FICA credits not utilized....................         --       462,862       462,862
  NOL carryforward.............................         --     6,232,200     6,232,200
  Other........................................         --         1,743         1,743
                                                 ---------   -----------   -----------
                                                   101,781     6,696,805     6,798,586
                                                 ---------   -----------   -----------
Deferred tax liabilities:
  Deferred state taxes.........................         --      (143,546)     (143,546)
  Prepaid expenses.............................   (245,326)           --      (245,326)
                                                  (245,326)     (143,546)     (388,872)
                                                 ---------   -----------   -----------
                                                  (143,545)    6,553,259     6,409,714
Less: valuation allowance......................    143,545    (6,553,259)   (6,409,714)
                                                 ---------   -----------   -----------
Net............................................  $      --   $        --   $        --
                                                 =========   ===========   ===========
</Table>

                                       F-52
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     Due to the uncertainty of the realization of certain tax carry forward
items, a valuation allowance has been established in the amount of $6.4 million
at December 6, 2001. Realization of a significant portion of the assets offset
by the valuation allowance is dependent on the Properties generating sufficient
taxable income prior to expiration of the loss and credit carryforwards.

     As of December 6, 2001, the Properties had a combined net operating loss
carryforward of approximately $17.8 million and a tax credit carryforward of $.7
million, which are available to offset future tax through 2020. The availability
of the loss and credit carryforwards may be subject to limitations under
sections 382 and 383 of the Internal Revenue Code in the event of a significant
change of ownership.

13.  CONTINGENCIES

     Guarantee -- The Properties are guarantors under various credit agreements,
including the Parent's Notes totaling approximately $99.7 million in outstanding
principal amount. In addition, substantially all of the Properties' assets serve
as collateral under such agreements. Subject to certain exceptions, the
guarantee of the Notes is secured by a lien on substantially all assets of the
Properties other than certain excluded assets, as defined. Such excluded assets
include, among other things, (i) cash, deposit accounts and other cash
equivalents; (ii) furniture, fixtures and equipment securing certain
non-recourse indebtedness; and (iii) any agreements, permits, licenses or the
like that cannot be subjected to a lien without the consent of third parties,
which consent is not obtainable by the Parent (including all gaming licenses of
the Parent and its restricted subsidiaries as defined), provided that excluded
assets does not include the proceeds of the assets under clauses (ii) or (iii)
or any other collateral to the extent such proceeds do not constitute excluded
assets under clause (i) above. Assets not transferred upon the close of the sale
with Majestic will continue to serve as collateral after the sale.

  LEGAL MATTERS

     Central City Litigation -- On or about May 25, 2001, City of Central,
Colorado ("Central City"), and certain businesses claiming to do business in
Central City commenced an action, Civil Action No. 01-D-0964, in the United
States District Court for the District of Colorado against the City of Black
Hawk, Colorado ("Black Hawk"), certain companies alleged to do business in or
about Black Hawk and various individuals.

     101 Main Street Limited Liability Company ("101 Main"), a wholly owned
subsidiary of Fitzgeralds Black Hawk, Inc.-II, was named defendant in the
action. The claims against all defendants, including 101 Main, are predicated on
15 U.S.C. section 1 (Restraint of Trade), 15 U.S.C. section 2 (Monopolization),
15 U.S.C. section 2 (Attempted Monopolization), Colorado Revised Statute section
6-4-104 (Restraint of Trade), violation of Colorado Revised Statute section
6-4-105 (Monopolization), Colorado Revised Statute section 6-4-105 (Attempted
Monopolization), 18 U.S.C. section 1962 (Racketeering), Colorado Revised Statute
section 18-17-104 (Colorado Organized Crime Control Act), intentional
interference with prospective economic advantage, civil conspiracy, tortuous
interference with contractual relations and inducing breach of contract. The
plaintiffs in the action are seeking judgment by jury against all defendants for
an amount in excess of $100.0 million. The principal cause of the action
relating to 101 Main is that the defendants, including 101 Main Street Limited
Liability Company, engaged in certain conduct to prevent the construction of a
highway defined as the "Southern Access Road" that would provide access to
travelers directly to Central City from Interstate 70 instead of requiring
passage through Black Hawk.

     The complaint was filed after the commencement of the Bankruptcy Cases, and
101 Main has asserted that the action was commenced in violation of the
automatic stay, Section 362(a) of the Bankruptcy Code. On June 21, 2001, the
Parent filed a Notice of Pending Bankruptcy Cases and Existence of the Automatic
Stay.

                                       F-53
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

     101 Main then obtained an order to show cause why Plaintiffs and their
attorneys should not be held in contempt. Before the hearing, Plaintiffs amended
the complaint to omit 101 Main as a defendant, and Plaintiffs filed two motions
with the Bankruptcy Court, which sought (i) leave to file a late claim in the
101 Main bankruptcy case and (ii) relief from the automatic stay to add 101 Main
as a party defendant to the amended complaint. The amended complaint sought
damages, in an amount alleged to exceed $300,000,000, against the defendants
for, among other matters, RICO and conspiracy.

     At a December 10, 2001 hearing, the Bankruptcy Court found that Plaintiffs
had violated the automatic stay and denied Plaintiffs' motion for leave to file
a late claim with the Bankruptcy Court. Furthermore, at this hearing the
Bankruptcy Court denied Plaintiffs' motion for relief from the automatic stay to
add 101 Main as a party defendant to the amended complaint, although it did
allow Plaintiffs to obtain discovery from 101 Main, its agents and
representatives in conjunction with the prosecution of the amended complaint
against other named defendants. On March 28, 2002, the Bankruptcy Court entered
its orders in this regard, which orders are now final and non-appealable.

     Other Legal Matters -- The Properties are a party to various lawsuits
relating to routine matters incidental to its business. Except as noted below,
the Properties do not believe that the outcome of such litigation, individually
or in the aggregate, will have any material adverse effect on its financial
condition.

     Reliance -- From April 1, 1998 through September 30, 1999, the Properties'
general liability insurance and worker's compensation insurance carrier was
Reliance Insurance Company ("Reliance"). On May 29, 2001, a Pennsylvania court
placed Reliance under the control of the Pennsylvania Insurance Department for
rehabilitation. Thereafter, on October 3, 2001, the Reliance Insurance Company
was declared insolvent and placed under an order of liquidation by the
Pennsylvania Commonwealth Court at the request of the Pennsylvania Insurance
Department. The Properties have not incurred any material amounts for liability
claims or workers compensation claims that would be subject to reimbursement by
Reliance.

     However, the statute of limitation has not expired for filing claims and it
is unclear at this time what the insurance coverage would be from Reliance, if
any, in the event that a future claim is filed that would be large enough to
result in an insurance reimbursement from Reliance, or if there is insurance
coverage for an existing claim that is currently under the threshold level for
reimbursement, but increases in the future to an amount eligible for
reimbursement. The reimbursement threshold per claim is $25,000 and $100,000 for
liability claims and worker compensation claims, respectively. At the present
time, the Properties are unable to determine what effect this action may have on
liability and worker's compensation claims which arose during the coverage
period for which Reliance was the Properties' insurance carrier or whether any
limitations on coverage would have a material adverse effect on the Properties'
financial condition.

     Holiday Inn -- Upon notification by Majestic of its intent to not enter
into a new franchise agreement with Holiday Inn Franchising, Inc. ("Inns"), the
Parent filed a motion with the Bankruptcy Court on October 26, 2001 to remove
its pre-petition franchise and other agreements with Inns from the list of
agreements to be assumed and assigned to Majestic. On October 26, 2001, the
Bankruptcy Court granted the motion. Since the transactions contemplated by the
Purchase Agreement were consummated on December 6, 2001, the Parent believes
Inns will assert an unsecured claim in the Bankruptcy Cases based upon the
liquidated damages provision of the franchise agreement (approximately $1.6
million). While the Parent would contest the allowance of such a claim by the
Bankruptcy Court, the Parent cannot predict the Bankruptcy Court's ultimate
resolution of such a claim.

14.  SEGMENT INFORMATION

     Until December 6, 2001, the Properties owned and operated three Fitzgeralds
casino-hotels: downtown Las Vegas, Nevada; Tunica, Mississippi; and Black Hawk,
Colorado. The Properties identify their business in

                                       F-54
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

three segments based on geographic location. The Properties market in each of
their segments primarily to middle-market customers, emphasizing their
Fitzgeralds brand and their "Fitzgeralds Irish Luck" theme. The major products
offered in each segment are as follows: casino, hotel (except for Fitzgeralds
Black Hawk) and food and beverage.

     The accounting policies of each business segment are the same as those
described in the summary of significant accounting policies. There are minimal
inter-segment sales. The Properties evaluate business segment performance based
on EBITDA (defined below). Corporate costs are allocated to the business segment
through management fees.

     Assets are principally cash and cash equivalents, property and equipment
and goodwill related to the acquisition of the remaining 78% membership interest
in 101 Main Street Limited Liability Company. No single customer accounts for
more than 10% of revenue.

     A summary of the Properties' operations by business segment for 1999, 2000
and 2001 is presented below:

<Table>
<Caption>
                                                                                  FOR THE
                                                                             PERIOD JANUARY 1,
                                                   YEAR ENDED DECEMBER 31,     2001 THROUGH
                                                   -----------------------      DECEMBER 6,
                                                      1999         2000            2001
                                                   ----------   ----------   -----------------
                                                                 (IN THOUSANDS)
<S>                                                <C>          <C>          <C>
Net operating revenues:
  Fitzgeralds Las Vegas..........................   $ 50,910     $ 52,139        $ 49,435
  Fitzgeralds Tunica.............................     69,582       75,062          76,713
  Fitzgeralds Black Hawk.........................     32,284       32,537          31,511
                                                    --------     --------        --------
     Total.......................................   $152,776     $159,738        $157,659
                                                    ========     ========        ========
Income (loss) from operations:
  Fitzgeralds Las Vegas..........................   $ (1,115)    $     (7)       $(23,618)
  Fitzgeralds Tunica.............................      5,321        9,018          42,033
  Fitzgeralds Black Hawk(1)......................      7,517        6,385           7,027
                                                    --------     --------        --------
     Total.......................................   $ 11,723     $ 15,396        $ 25,442
                                                    ========     ========        ========
Reconciliation of total business segment
  operating income to combined net income (loss)
  before income tax and extraordinary item:
  Total segment operating income.................   $ 11,723     $ 15,396        $ 25,442
  Interest income................................        130          167              38
  Interest expense...............................       (210)         (71)            (40)
  Interest expense -- related party..............    (27,990)     (26,031)             --
  Other, net.....................................         99            4             (81)
                                                    --------     --------        --------
     Net income (loss) before income tax.........   $(16,248)    $(10,535)       $ 25,359
                                                    ========     ========        ========
EBITDA(2):
  Fitzgeralds Las Vegas(3).......................   $  2,594     $  3,692        $(23,618)
  Fitzgeralds Tunica.............................     11,553       15,253          42,198
  Fitzgeralds Black Hawk.........................      9,303        8,138           7,027
                                                    --------     --------        --------
     Total.......................................   $ 23,450     $ 27,083        $ 25,607
                                                    ========     ========        ========
</Table>

                                       F-55
<PAGE>
           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY

             NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                                                                  FOR THE
                                                                             PERIOD JANUARY 1,
                                                   YEAR ENDED DECEMBER 31,     2001 THROUGH
                                                   -----------------------      DECEMBER 6,
                                                      1999         2000            2001
                                                   ----------   ----------   -----------------
                                                                 (IN THOUSANDS)
<S>                                                <C>          <C>          <C>
Segment depreciation and amortization:
  Fitzgeralds Las Vegas..........................   $  3,709     $  3,698        $     --
  Fitzgeralds Tunica.............................      6,231        6,235              --
  Fitzgeralds Black Hawk.........................      1,786        1,755              --
                                                    --------     --------        --------
     Total.......................................   $ 11,726     $ 11,688        $     --
                                                    ========     ========        ========
Expenditures for additions to long-lived assets:
  Fitzgeralds Las Vegas..........................   $  1,635     $  1,619        $    249
  Fitzgeralds Tunica.............................      2,393        6,199             627
  Fitzgeralds Black Hawk.........................        687        1,518             178
                                                    --------     --------        --------
     Total.......................................   $  4,715     $  9,336        $  1,054
                                                    ========     ========        ========
</Table>

<Table>
<Caption>
                                                                 AS OF          AS OF
                                                              DECEMBER 31,   DECEMBER 6,
                                                                  2000          2001
                                                              ------------   -----------
                                                                    (IN THOUSANDS)
<S>                                                           <C>            <C>
Segment assets:
  Fitzgeralds Las Vegas.....................................    $ 42,657       $ 1,789
  Fitzgeralds Tunica........................................      65,943        15,547
  Fitzgeralds Black Hawk....................................      38,728         5,024
                                                                --------       -------
     Total..................................................     147,328        22,360
  Less: inter-company.......................................          (8)           13
                                                                --------       -------
     Total..................................................    $147,320       $22,373
                                                                ========       =======
</Table>

---------------

(1) Includes write-down of assets of $13.0 million in 2001 at Fitzgeralds Black
    Hawk.

(2) EBITDA is a supplemental financial measurement used by the Company in the
    evaluation of its gaming business and by many gaming industry analysts.
    EBITDA is calculated by adding depreciation and amortization expense to
    income from operations. At any property, EBITDA is calculated after the
    allocation of corporate costs. However, EBITDA should only be read in
    conjunction with all of the Properties' financial data summarized above and
    its financial statements prepared in accordance with generally accepted
    accounting principles ("GAAP") appearing elsewhere herein, and should not be
    construed as an alternative either to income from operations (as determined
    in accordance with GAAP) as an indication of the Properties' operating
    performance or to cash flows from operating activities (as determined in
    accordance with GAAP) as a measure of liquidity. This presentation of EBITDA
    may not be comparable to similarly titled measures reported by other
    companies.

(3) Fitzgeralds Las Vegas invested $0.8 million, $0.9 million and $0.9 million
    in 2001, 2000 and 1999, respectively, in FSE. Such investment was charged
    against earnings as a selling, general and administrative expense.

                                       F-56
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)
           SUPPLEMENTAL COMBINING SCHEDULE -- STATEMENT OF OPERATIONS
                INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1999

<Table>
<Caption>
                                                                      101 MAIN STREET
                                  FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING
                                LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES     COMBINED TOTAL
                                ---------------   -----------------   ---------------   -----------   --------------
<S>                             <C>               <C>                 <C>               <C>           <C>
OPERATING REVENUES:
  Casino......................    $38,129,610       $ 65,676,465        $35,122,740        $  --       $138,928,815
  Food and beverage...........      8,502,928          7,936,527          2,289,609           --         18,729,064
  Rooms.......................      8,465,897          7,827,721                 --           --         16,293,618
  Other.......................      1,808,135          1,195,908            281,164           --          3,285,207
                                  -----------       ------------        -----------        -----       ------------
         Total................     56,906,570         82,636,621         37,693,513           --        177,236,704
  Less promotional
    allowances................      5,996,339         13,054,629          5,409,080           --         24,460,048
                                  -----------       ------------        -----------        -----       ------------
         Net..................     50,910,231         69,581,992         32,284,433           --        152,776,656
                                  -----------       ------------        -----------        -----       ------------
OPERATING COSTS AND EXPENSES:
  Casino......................     19,583,057         31,027,932         13,535,985           --         64,146,974
  Food and beverage...........      7,695,608          2,929,046          1,168,417           --         11,793,071
  Rooms.......................      6,101,345          4,599,896                 --           --         10,701,241
  Other.......................        906,070            386,663            584,297           --          1,877,030
  Selling, general and
    administrative............     14,029,853         19,085,794          7,693,145                      40,808,792
  Depreciation and
    amortization..............      3,709,225          6,231,109          1,785,751           --         11,726,085
                                  -----------       ------------        -----------        -----       ------------
         Total................     52,025,158         64,260,440         24,767,595           --        141,053,193
                                  -----------       ------------        -----------        -----       ------------
INCOME (LOSS) FROM
  OPERATIONS..................     (1,114,927)         5,321,552          7,516,838                      11,723,463
OTHER INCOME (EXPENSE):
  Interest income.............         43,422             67,221             19,011           --            129,654
  Interest expense............       (120,596)           (65,291)           (24,427)          --           (210,314)
  Interest expense -- related
    party.....................     (7,951,662)       (12,722,660)        (7,315,529)          --        (27,989,851)
  Other, net..................        100,606                 --             (1,594)          --             99,012
                                  -----------       ------------        -----------        -----       ------------
INCOME (LOSS) BEFORE INCOME
  TAXES.......................     (9,043,157)        (7,399,178)           194,299           --        (16,248,036)
INCOME TAX (PROVISION)
  BENEFIT.....................             --                 --                 --           --                 --
                                  -----------       ------------        -----------        -----       ------------
NET INCOME (LOSS).............    $(9,043,157)      $ (7,399,178)       $   194,299        $  --       $(16,248,036)
                                  ===========       ============        ===========        =====       ============
</Table>

                                       F-57
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)
            SUPPLEMENTAL COMBINING SCHEDULE--STATEMENT OF CASH FLOWS
                INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1999

<Table>
<Caption>
                                                                              101 MAIN STREET
                                          FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING
                                        LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES     COMBINED TOTAL
                                        ---------------   -----------------   ---------------   -----------   --------------
<S>                                     <C>               <C>                 <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)...................    $(9,043,157)       $(7,399,178)       $  194,299         $           $(16,248,036)
  Adjustments to reconcile net income
    (loss) to net cash provided by
    operating activities:
    Depreciation and amortization.....      3,709,225          6,231,109         1,785,751            --         11,726,085
    Other.............................        (59,626)                --             1,594            --            (58,032)
    (Increase) decrease in accounts
      receivable, net.................        100,735            113,972           (78,617)           --            136,090
    Increase in inventories...........        (80,012)           (23,278)          (32,376)           --           (135,666)
    (Increase) decrease in prepaid
      expenses........................       (380,727)           (54,012)           33,631            --           (401,108)
    (Increase) decrease in other
      assets..........................         41,423           (190,879)           19,365            --           (130,091)
    Increase (decrease) in accounts
      payable.........................     (1,096,585)        (1,453,520)           38,267            --         (2,511,838)
    Increase (decrease) in accrued and
      other liabilities...............       (355,418)         1,031,932          (226,009)           --            450,505
    Increase (decrease) in amounts due
      to related parties, net.........     10,196,712          5,808,510           (59,877)           --         15,945,345
                                          -----------        -----------        ----------         -----       ------------
         Net cash provided by
           operating activities.......      3,032,570          4,064,656         1,676,028            --          8,773,254
                                          -----------        -----------        ----------         -----       ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from sale of assets........         59,626                 --            18,100            --             77,726
  Acquisition of property and
    equipment.........................     (1,568,093)        (2,090,648)         (686,847)           --         (4,345,588)
                                          -----------        -----------        ----------         -----       ------------
         Net cash used in investing
           activities.................     (1,508,467)        (2,090,648)         (668,747)           --         (4,267,862)
                                          -----------        -----------        ----------         -----       ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of long-term debt.........     (1,511,339)          (891,606)         (572,677)           --         (2,975,622)
                                          -----------        -----------        ----------         -----       ------------
         Net cash used in financing
           activities.................     (1,511,339)          (891,606)         (572,677)           --         (2,975,622)
                                          -----------        -----------        ----------         -----       ------------
NET INCREASE IN CASH AND CASH
  EQUIVALENTS.........................         12,764          1,082,402           434,604            --          1,529,770
CASH AND CASH EQUIVALENTS, BEGINNING
  OF YEAR.............................      3,113,838          4,104,073         1,530,344            --          8,748,255
                                          -----------        -----------        ----------         -----       ------------
CASH AND CASH EQUIVALENTS, END OF
  YEAR................................    $ 3,126,602        $ 5,186,475        $1,964,948         $  --       $ 10,278,025
                                          ===========        ===========        ==========         =====       ============
</Table>

                                       F-58
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)
          SUPPLEMENTAL COMBINING SCHEDULE -- BALANCE SHEET INFORMATION
                              AT DECEMBER 31, 2000

<Table>
<Caption>
                                                                       101 MAIN STREET
                                   FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                                 LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                                 ---------------   -----------------   ---------------   -----------   ------------
<S>                              <C>               <C>                 <C>               <C>           <C>
                                                      ASSETS
CURRENT ASSETS:
  Cash and cash equivalents....   $  1,068,324       $    684,394        $ 1,087,293      $            $  2,840,011
  Prepaid expenses:............                                                                 --
    Gaming taxes...............        237,196             28,185                 --            --          265,381
    Other......................        133,269            176,266             56,777            --          366,312
                                  ------------       ------------        -----------      --------     ------------
         Total current
           assets..............      1,438,789            888,845          1,144,070            --        3,471,704
                                  ------------       ------------        -----------      --------     ------------
OTHER ASSETS:
  Net assets held for sale.....     40,704,997         65,054,132         37,583,761            --      143,342,890
  Restricted cash..............        500,000                 --                 --            --          500,000
  Long-term accounts
    receivable -- related
    parties....................         13,033                 --                 --        (7,724)(a)        5,309
                                  ------------       ------------        -----------      --------     ------------
         Total other assets....     41,218,030         65,054,132         37,583,761        (7,724)     143,848,199
                                  ------------       ------------        -----------      --------     ------------
TOTAL..........................   $ 42,656,819       $ 65,942,977        $38,727,831      $ (7,724)    $147,319,903
                                  ============       ============        ===========      ========     ============

                                     LIABILITIES AND STOCKHOLDER'S DEFICIENCY
LIABILITIES NOT SUBJECT TO
  COMPROMISE
CURRENT LIABILITIES:
  Payroll and related..........   $    118,409       $    305,652        $    67,194      $     --     $    491,255
                                  ------------       ------------        -----------      --------     ------------
         Total liabilities not
           subject to
           compromise..........        118,409            305,652             67,194            --          491,255
LIABILITIES SUBJECT TO
  COMPROMISE...................     88,396,939         96,492,176         40,992,105        (7,724)(b)  225,873,496
                                  ------------       ------------        -----------      --------     ------------
         Total liabilities.....     88,515,348         96,797,828         41,059,299        (7,724)     226,364,751
                                  ------------       ------------        -----------      --------     ------------
STOCKHOLDER'S DEFICIENCY.......    (45,858,529)       (30,854,851)        (2,331,468)           --      (79,044,848)
                                  ------------       ------------        -----------      --------     ------------
TOTAL..........................   $ 42,656,819       $ 65,942,977        $38,727,831      $ (7,724)    $147,319,903
                                  ============       ============        ===========      ========     ============
</Table>

---------------

(a) To eliminate intercompany accounts and notes receivable.

(b) To eliminate intercompany accounts and notes payable.

                                       F-59
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

         FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC. AND
                   101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

           SUPPLEMENTAL COMBINING SCHEDULE -- STATEMENT OF OPERATIONS
                INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2000

<Table>
<Caption>
                                                                 101 MAIN STREET
                             FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                           LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                           ---------------   -----------------   ---------------   -----------   ------------
<S>                        <C>               <C>                 <C>               <C>           <C>
OPERATING REVENUES:
  Casino.................    $38,476,427        $73,506,899        $36,793,529        $  --      $148,776,855
  Food and beverage......      8,541,003          8,658,645          2,386,565           --        19,586,213
  Rooms..................      8,452,168          8,147,904                 --           --        16,600,072
  Other..................      2,246,343            977,444            306,245           --         3,530,032
                             -----------        -----------        -----------        -----      ------------
          Total..........     57,715,941         91,290,892         39,486,339           --       188,493,172
     Less promotional
       allowances........      5,576,597         16,229,247          6,949,780           --        28,755,624
                             -----------        -----------        -----------        -----      ------------
          Net............     52,139,344         75,061,645         32,536,559           --       159,737,548
                             -----------        -----------        -----------        -----      ------------
OPERATING COSTS AND
  EXPENSES:
  Casino.................     19,945,222         34,163,968         15,004,089           --        69,113,279
  Food and beverage......      7,487,388          3,241,141            780,436           --        11,508,965
  Rooms..................      6,672,465          4,231,886                 --           --        10,904,351
  Other..................        756,129            377,204            583,849           --         1,717,182
  Selling, general and
     administrative......     13,586,618         17,757,582          8,026,758                     39,370,958
  Depreciation and
     amortization........      3,698,468          6,234,911          1,754,585           --        11,687,964
  Reorganization items...             --             37,015              1,952           --            38,967
                             -----------        -----------        -----------        -----      ------------
          Total..........     52,146,290         66,043,707         26,151,669           --       144,341,666
                             -----------        -----------        -----------        -----      ------------
INCOME (LOSS) FROM
  OPERATIONS.............         (6,946)         9,017,938          6,384,890                     15,395,882
OTHER INCOME (EXPENSE):
  Interest income........         49,433             88,699             29,314           --           167,446
  Interest expense.......        (52,923)           (16,561)            (1,898)          --           (71,382)
  Interest expense --
     related party.......     (7,386,790)       (11,848,387)        (6,795,846)                   (26,031,023)
  Other, net.............         48,943            (44,450)                --                          4,493
                             -----------        -----------        -----------        -----      ------------
NET LOSS.................    $(7,348,283)       $(2,802,761)       $  (383,540)       $  --      $(10,534,584)
                             ===========        ===========        ===========        =====      ============
</Table>

                                       F-60
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

         FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC. AND
                   101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

           SUPPLEMENTAL COMBINING SCHEDULE -- STATEMENT OF CASH FLOWS
                INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2000

<Table>
<Caption>
                                                                           101 MAIN STREET
                                       FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                                     LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                                     ---------------   -----------------   ---------------   -----------   ------------
<S>                                  <C>               <C>                 <C>               <C>           <C>
CASH FLOWS FROM OPERATING
  ACTIVITIES:
  Net loss.........................    $(7,348,283)       $(2,802,761)       $  (383,540)       $          $(10,534,584)
  Adjustments to reconcile net loss
    to net cash provided by
    operating activities:
    Depreciation and
      amortization.................      3,698,468          6,234,911          1,754,585           --        11,687,964
    Reorganization items incurred
      in connection with Chapter 11
      and related legal
      proceedings..................             --             37,015              1,952           --            38,967
    Other..........................         (7,963)            44,450                 --           --            36,487
    (Increase) decrease in accounts
      receivable, net..............       (295,349)           (13,680)            75,670           --          (233,359)
    (Increase) decrease in
      inventories..................        146,770            (57,423)             9,182           --            98,529
    (Increase) decrease in prepaid
      expenses.....................       (365,739)             6,734           (133,961)          --          (492,966)
    (Increase) decrease in other
      assets.......................         17,285            (14,950)          (141,363)          --          (139,028)
    Decrease in accounts payable...       (746,909)          (429,695)          (231,515)          --        (1,408,119)
    Decrease in accrued and other
      liabilities..................       (232,349)        (1,864,197)           (28,432)          --        (2,124,978)
    Increase in amounts due to
      related parties, net.........      7,599,558          6,067,908          1,466,808                     15,134,274
    Increase in liabilities subject
      to compromise................         33,677             65,267              7,733                        106,677
                                       -----------        -----------        -----------        -----      ------------
    Net cash provided by operating
      activities before
      reorganization items.........      2,499,166          7,273,579          2,397,119           --        12,169,864
    Reorganization items incurred
      in connection with Chapter 11
      and related legal
      proceedings..................             --            (37,015)            (1,952)          --           (38,967)
                                       -----------        -----------        -----------        -----      ------------
         Net cash provided by
           operating activities....      2,499,166          7,236,564          2,395,167           --        12,130,897
                                       -----------        -----------        -----------        -----      ------------
CASH FLOWS FROM INVESTING
  ACTIVITIES:
  Proceeds from sale of assets.....          7,963                 --                500           --             8,463
  Acquisition of property and
    equipment......................     (1,250,139)        (6,243,359)        (1,518,444)          --        (9,011,942)
                                       -----------        -----------        -----------        -----      ------------
         Net cash used in investing
           activities..............     (1,242,176)        (6,243,359)        (1,517,944)          --        (9,003,479)
                                       -----------        -----------        -----------        -----      ------------
</Table>

                                       F-61
<PAGE>

<Table>
<Caption>
                                                                           101 MAIN STREET
                                       FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                                     LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                                     ---------------   -----------------   ---------------   -----------   ------------
<S>                                  <C>               <C>                 <C>               <C>           <C>
CASH FLOWS FROM FINANCING
  ACTIVITIES:
  Repayment of long-term debt......       (232,872)          (220,688)                --           --          (453,560)
                                       -----------        -----------        -----------        -----      ------------
         Net cash used in financing
           activities..............       (232,872)          (220,688)                --           --          (453,560)
                                       -----------        -----------        -----------        -----      ------------
NET INCREASE IN CASH AND CASH
  EQUIVALENTS......................      1,024,118            772,517            877,223           --         2,673,858
CASH AND CASH EQUIVALENTS,
  BEGINNING OF YEAR................      3,126,602          5,186,475          1,964,948           --        10,278,025
INCREASE IN CASH AND CASH
  EQUIVALENTS INCLUDED IN NET
  ASSETS HELD FOR SALE.............     (3,082,396)        (5,274,598)        (1,754,878)          --       (10,111,872)
                                       -----------        -----------        -----------        -----      ------------
CASH AND CASH EQUIVALENTS, END OF
  YEAR.............................    $ 1,068,324        $   684,394        $ 1,087,293        $  --      $  2,840,011
                                       ===========        ===========        ===========        =====      ============
</Table>

                                       F-62
<PAGE>

                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

          SUPPLEMENTAL COMBINING SCHEDULE -- BALANCE SHEET INFORMATION
                              AT DECEMBER 6, 2001

<Table>
<Caption>
                                                                         101 MAIN STREET
                                     FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING      COMBINED
                                   LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES         TOTAL
                                   ---------------   -----------------   ---------------   -----------    ------------
<S>                                <C>               <C>                 <C>               <C>            <C>
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents......   $    726,021        $ 2,388,390        $  648,155        $            $  3,762,566
  Accounts receivable, net.......          3,963            192,532            29,000                          225,495
  Prepaid expenses:
    Gaming taxes.................        783,392             32,360             1,838                          817,590
    Other........................        275,749            309,651           194,838                          780,238
                                    ------------        -----------        ----------        -------      ------------
      Total current assets.......      1,789,125          2,922,933           873,831             --         5,585,889
                                    ------------        -----------        ----------        -------      ------------
OTHER ASSETS:
  Accounts receivable -- related
    parties......................             --         12,599,516         4,149,702         13,076(a)     16,762,294
  Other assets...................             --             25,000                --                           25,000
                                    ------------        -----------        ----------        -------      ------------
      Total other assets.........             --         12,624,516         4,149,702         13,076        16,787,294
                                    ------------        -----------        ----------        -------      ------------
TOTAL............................   $  1,789,125        $15,547,449        $5,023,533        $13,076      $ 22,373,183
                                    ============        ===========        ==========        =======      ============

LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES NOT SUBJECT TO
  COMPROMISE
CURRENT LIABILITIES:
  Accounts payable...............   $    166,073        $        --        $       --        $            $    166,073
  Due to Majestic................      2,405,289          1,716,150          (321,439)                       3,800,000
  Accrued and other:
    Payroll and related..........        204,835            486,628           227,680                          919,143
    Other........................         76,034             98,912            89,786                          264,732
                                    ------------        -----------        ----------        -------      ------------
      Total current
         liabilities.............      2,852,231          2,301,690            (3,973)            --         5,149,948
                                    ------------        -----------        ----------        -------      ------------
NOTE PAYABLE -- RELATED PARTY....        215,749                 --                --         13,076(a)        228,825
                                    ------------        -----------        ----------        -------      ------------
      Total liabilities not
         subject to compromise...      3,067,980          2,301,690            (3,973)        13,076         5,378,773
LIABILITIES SUBJECT TO
  COMPROMISE.....................     68,245,167          2,071,002           364,293                       70,680,462
                                    ------------        -----------        ----------        -------      ------------
      Total liabilities..........     71,313,147          4,372,692           360,320         13,076        76,059,235
                                    ------------        -----------        ----------        -------      ------------
STOCKHOLDER'S DEFICIENCY.........    (69,524,022)        11,174,757         4,663,213             --       (53,686,052)
                                    ------------        -----------        ----------        -------      ------------
TOTAL............................   $  1,789,125        $15,547,449        $5,023,533        $13,076      $ 22,373,183
                                    ============        ===========        ==========        =======      ============
</Table>

---------------

(a) To eliminate intercompany accounts and notes receivable/payable.

                                       F-63
<PAGE>
                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

           SUPPLEMENTAL COMBINING SCHEDULE -- STATEMENT OF OPERATIONS
    INFORMATION FOR THE PERIOD FROM JANUARY 1, 2001 THROUGH DECEMBER 6, 2001

<Table>
<Caption>
                                                                            101 MAIN STREET
                                        FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                                      LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                                      ---------------   -----------------   ---------------   -----------   ------------
<S>                                   <C>               <C>                 <C>               <C>           <C>
OPERATING REVENUES:
  Casino............................   $ 37,401,549       $ 77,462,357       $ 35,806,661                   $150,670,567
  Food and beverage.................      7,619,373          8,480,323          2,265,547                     18,365,243
  Rooms.............................      7,421,444          7,620,756                 --                     15,042,200
  Other.............................      2,150,660          1,114,620            280,058                      3,545,338
                                       ------------       ------------       ------------         ---       ------------
      Total.........................     54,593,026         94,678,056         38,352,266          --        187,623,348
Less promotional allowances.........      5,157,564         17,965,548          6,840,890                     29,964,002
                                       ------------       ------------       ------------         ---       ------------
      Net...........................     49,435,462         76,712,508         31,511,376          --        157,659,346
                                       ------------       ------------       ------------         ---       ------------
OPERATING COSTS AND EXPENSES:
  Casino............................     19,802,333         35,536,411         14,419,043                     69,757,787
  Food and beverage.................      6,692,684          3,041,117            891,216                     10,625,017
  Rooms.............................      6,357,318          3,461,234                 --                      9,818,552
  Other.............................        582,166            440,179            634,920                      1,657,265
  Selling, general and
    administrative..................     13,792,262         16,194,550          7,865,398          --         37,852,210
  Depreciation and amortization.....             --                 --                 --                             --
  Reorganization items..............     25,826,705        (23,994,013)       (12,331,767)                   (10,499,075)
  Write-down of assets..............                                           13,005,582                     13,005,582
                                       ------------       ------------       ------------         ---       ------------
      Total.........................     73,053,468         34,679,478         24,484,392          --        132,217,338
                                       ------------       ------------       ------------         ---       ------------
INCOME (LOSS) FROM OPERATIONS.......    (23,618,006)        42,033,030          7,026,984          --         25,442,008
OTHER INCOME (EXPENSE)
  Interest income...................         38,407                 --                 --                         38,407
  Interest expense..................        (34,637)            (5,322)                --                        (39,959)
  Other, net........................        (51,258)             1,900            (32,302)         --            (81,660)
                                       ------------       ------------       ------------         ---       ------------
NET INCOME (LOSS)...................   $(23,665,494)      $ 42,029,608       $  6,994,682         $--       $ 25,358,796
                                       ============       ============       ============         ===       ============
</Table>

                                       F-64
<PAGE>
                    HISTORICAL COMBINED FINANCIAL STATEMENTS

           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

           SUPPLEMENTAL COMBINING SCHEDULE -- STATEMENT OF CASH FLOWS
    INFORMATION FOR THE PERIOD FROM JANUARY 1, 2001 THROUGH DECEMBER 6, 2001

<Table>
<Caption>
                                                                                     101 MAIN STREET
                                                 FITZGERALDS        FITZGERALDS          LIMITED       ELIMINATING     COMBINED
                                               LAS VEGAS, INC.   MISSISSIPPI, INC.    LIABILITY CO.      ENTRIES        TOTAL
                                               ---------------   -----------------   ---------------   -----------   ------------
<S>                                            <C>               <C>                 <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)............................   $(23,665,494)      $ 42,029,608       $  6,994,682         $--       $ 25,358,796
Adjustments to reconcile net income (loss) to
  net cash used in operating activities
Write-down of assets.........................             --                 --         13,005,582                     13,005,582
(Gain) loss on sale of assets to Majestic....     25,290,831        (24,079,205)       (12,333,437)                   (11,121,811)
Reorganization items incurred in connection
  with Chapter 11 and related legal
  proceedings................................        535,874             85,192              1,670                        622,736
Other........................................         89,632             (1,900)            28,707          --            116,439
(Increase) decrease in accounts receivable,
  net........................................         36,093            (24,085)           (54,079)                       (42,071)
Decrease in amounts due to related parties,
  net........................................     (8,418,141)       (22,898,876)        (9,087,324)         --        (40,404,341)
(Increase) decrease in inventories...........         66,699             28,960            (29,611)                        66,048
(Increase) decrease in prepaid expenses......        424,323            (65,417)          (102,921)                       255,985
(Increase) decrease in other assets..........         34,204             (7,089)                --                         27,115
Increase (decrease) in accounts payable......        799,009           (451,016)          (107,187)                       240,806
Increase (decrease) in due to Majestic.......      2,405,290          1,716,150           (321,440)                     3,800,000
Increase (decrease) in liabilities subject to
  compromise.................................         16,298            125,805              7,732                        149,835
Increase (decrease) in accrued and other
  liabilities................................        (87,589)           756,736            (44,678)                       624,469
                                                ------------       ------------       ------------         ---       ------------
Net cash used in operating activities before
  reorganizational items.....................     (2,472,971)        (2,785,137)        (2,042,304)                    (7,300,412)
Reorganization items:
Interest received on cash accumulated because
  of the bankruptcy proceedings..............             --            119,848             51,594                        171,442
Professional fees paid for services rendered
  in connection with the bankruptcy
  proceedings................................        (25,128)                --            (13,264)                       (38,392)
Other reorganization items incurred in
  connection with Chapter 11 and related
  legal proceedings..........................       (510,746)          (205,040)           (40,000)                      (755,786)
                                                ------------       ------------       ------------         ---       ------------
Net cash used in operating activities........     (3,008,845)        (2,870,329)        (2,043,974)         --         (7,923,148)
                                                ------------       ------------       ------------         ---       ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of assets................             --                 --             28,250                         28,250
Acquisition of property and equipment........       (248,581)          (627,258)          (178,292)                    (1,054,131)
                                                ------------       ------------       ------------         ---       ------------
Net cash used in investing activities........       (248,581)          (627,258)          (150,042)         --         (1,025,881)
                                                ------------       ------------       ------------         ---       ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt..................       (167,273)           (73,015)                --                       (240,288)
                                                ------------       ------------       ------------         ---       ------------
Net cash used in financing activities........       (167,273)           (73,015)                --          --           (240,288)
                                                ------------       ------------       ------------         ---       ------------
NET DECREASE IN CASH AND CASH EQUIVALENTS....     (3,424,699)        (3,570,602)        (2,194,016)                    (9,189,317)
CASH AND CASH EQUIVALENTS, BEGINNING OF
  PERIOD.....................................      1,068,324            684,394          1,087,293                      2,840,011
INCREASE IN CASH AND CASH EQUIVALENTS
  INCLUDED IN NET ASSETS HELD FOR SALE.......      3,082,396          5,274,598          1,754,878                     10,111,872
                                                ------------       ------------       ------------         ---       ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD.....   $    726,021       $  2,388,390       $    648,155         $--       $  3,762,566
                                                ============       ============       ============         ===       ============
</Table>

                                       F-65
<PAGE>
                                                                     SCHEDULE II




           FITZGERALDS LAS VEGAS, INC., FITZGERALDS MISSISSIPPI, INC.
                 AND 101 MAIN STREET LIMITED LIABILITY COMPANY
                            (DEBTORS-IN-POSSESSION)
         (WHOLLY OWNED SUBSIDIARIES OF FITZGERALDS GAMING CORPORATION)

                   COMBINED VALUATION AND QUALIFYING ACCOUNTS


<Table>
<Caption>
                                                                               Additions
                                                                              Charged to
                                                            Balance at         Costs and                             Balance at
Description                                            Beginning of Period     Expenses        Deductions(1)        End of Period
------------------------------------------------------ -------------------    ----------       -------------        -------------
<S>                                                    <C>                    <C>              <C>                  <C>
Allowance for doubtful accounts receivable
Period from
  January 1, 2001 to
  December 6, 2001 ....................................      $210,586           $209,983         $(223,670)            $196,899
Year ended December 31, 2000 ..........................       356,397             98,242          (244,053)             210,586
Year ended December 31, 1999 ..........................       291,925            414,716          (350,244)             356,397
</Table>


---------------
(1) Write-offs of uncollectible accounts receivable, net of recoveries






                                      F-66
<PAGE>
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Members of
Buffington Harbor Riverboats, L.L.C.:



We have audited the accompanying balance sheets of Buffington Harbor Riverboats,
L.L.C. (a Delaware limited liability company) as of December 31, 2001 and 2000,
and the related statements of operations, members' capital and cash flows for
each of the three years in the period ended December 31, 2001. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the 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 financial position of Buffington Harbor Riverboats,
L.L.C. as of December 31, 2001 and 2000, and the results of its operations and
its cash flows for the three years in the period ended December 31, 2001, in
conformity with accounting principles generally accepted in the United States.


                                                             ARTHUR ANDERSEN LLP


Roseland, New Jersey
January 30, 2002

                                      F-67

<PAGE>
                      BUFFINGTON HARBOR RIVERBOATS, L.L.C.
                                 BALANCE SHEETS
                           DECEMBER 31, 2001 AND 2000

<TABLE>
<CAPTION>
                                       ASSETS                                               2001            2000
                                       ------                                               ----            ----
<S>                                                                                   <C>               <C>
CURRENT ASSETS:
    Cash                                                                              $     317,646     $     286,921
    Trade receivables                                                                        26,014           206,757
    Due from members' (Note 2)                                                                    -           549,947
    Inventory                                                                               310,348           228,519
    Prepaid expenses and other current assets                                               127,993           169,205
    Note and accrued interest receivable from affiliate (Note 4)                                  -        14,402,010
                                                                                      -------------     -------------
                 Total current assets                                                       782,001        15,843,359

PROPERTY, PLANT AND EQUIPMENT, NET (Notes 2 and 3)                                       69,650,069        75,100,370

OTHER ASSETS                                                                                111,478           116,955
                                                                                      -------------     -------------
                 Total assets                                                         $  70,543,548     $  91,060,684
                                                                                      =============     =============

                        LIABILITIES AND MEMBERS' CAPITAL
                        --------------------------------

CURRENT LIABILITIES:
    Accounts payable                                                                  $     435,325     $   1,425,399
    Accrued expenses                                                                      1,752,105         1,787,219
    Member advance (Note 4)                                                                       -         7,099,167
    Due to members' (Note 2)                                                                558,469                 -
                                                                                      -------------     -------------
                 Total current liabilities                                                2,745,899        10,311,785

COMMITMENTS AND CONTINGENCIES (Note 4)

MEMBERS' CAPITAL                                                                         67,797,649        80,748,899
                                                                                      -------------     -------------
                 Total liabilities and members' capital                               $  70,543,548     $  91,060,684
                                                                                      =============     =============
</TABLE>


              The accompanying notes to financial statements are an
                     integral part of these balance sheets.

                                      F-68
<PAGE>
                      BUFFINGTON HARBOR RIVERBOATS, L.L.C.
                            STATEMENTS OF OPERATIONS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
              -----------------------------------------------------

<TABLE>
<CAPTION>
                                                                 2001                2000              1999
                                                            -------------      --------------     -------------
<S>                                                         <C>                <C>                <C>
REVENUES:
    Food and beverage                                       $  1,495,123       $   4,017,032      $  4,454,387
    Other (Note 2)                                            14,973,458          13,796,980        13,839,552
                                                            -------------      --------------     -------------
                 Net revenues                                 16,468,581          17,814,012        18,293,939
                                                            -------------      --------------     -------------

COST AND EXPENSES:
    Food and beverage                                          2,725,991           2,483,154         2,843,285
    General and administrative                                13,659,254          13,151,389        14,957,381
    Depreciation                                               5,595,497           6,260,583         6,022,374
    Other                                                        469,459             269,220           172,163
                                                            -------------      --------------
                                                              22,450,201          22,164,346        23,995,203
                                                            -------------      --------------     -------------
                 Loss from operations                         (5,981,620)         (4,350,334)       (5,701,264)

INTEREST INCOME, net                                             386,145             232,996             5,254
                                                            -------------      --------------     -------------
                 Net loss                                   $ (5,595,475)      $  (4,117,338)     $ (5,696,010)
                                                            =============      ==============     =============
</TABLE>

  The accompanying notes to financial statements are an integral part of these
                                   statements.

                                      F-69
<PAGE>
                      BUFFINGTON HARBOR RIVERBOATS, L.L.C.
                         STATEMENTS OF MEMBERS' CAPITAL
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

<TABLE>
<CAPTION>
                                                                                       Retained
                                                                       Member          Earnings
                                                                   Contributions       (Deficit)         Total
                                                                  ---------------   ---------------  --------------
<S>                                                               <C>               <C>              <C>
BALANCE, December 31, 1998                                        $   99,607,746    $  (18,109,972)  $  81,497,774

    Capital contribution made by Trump Indiana, Inc.                     245,331                 -         245,331
    Capital contribution made by The Majestic Star Casino, LLC           245,331                 -         245,331
    Net loss                                                                   -        (5,696,010)     (5,696,010)
                                                                  ---------------   ---------------  --------------

BALANCE, December 31, 1999                                           100,098,408       (23,805,982)     76,292,426

    Capital contribution made by Trump Indiana, Inc.                     737,322                 -         737,322
    Capital contribution made by The Majestic Star Casino, LLC         7,836,489                 -       7,836,489
    Net loss                                                                   -        (4,117,338)     (4,117,338)
                                                                  ---------------   ---------------  --------------

BALANCE, December 31, 2000                                           108,672,219       (27,923,320)     80,748,899

    Capital contribution made by Trump Indiana, Inc.                     214,759                 -         214,759
    Capital contribution made by The Majestic Star Casino, LLC           214,666                 -         214,666
    Transfer of assignment of BHPA interest receivable (Note 4)         (343,016)                -        (343,016)

    Transfer of assignment of BHPA note receivable (Note 4)           (7,442,184)                -      (7,442,184)

    Net loss                                                                   -        (5,595,475)     (5,595,475)
                                                                  ---------------   ---------------  --------------

BALANCE, December 31, 2001                                        $  101,316,444    $  (33,518,795)  $  67,797,649
                                                                  ===============   ===============  ==============
</TABLE>

  The accompanying notes to financial statements are an integral part of these
                                   statements.

                                      F-70
<PAGE>
                       BUFFINGTON HARBOR RIVERBOATS, L.L.C
                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

<TABLE>
<CAPTION>
                                                                            2001               2000                1999
                                                                        ------------       ------------       ------------
<S>                                                                     <C>                <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss                                                            $ (5,595,475)      $ (4,117,338)      $ (5,696,010)
    Adjustments to reconcile net loss to net cash flows provided
       by (used in) operating activities-
       Depreciation                                                        5,595,497          6,260,583          6,022,374
       Deferred rent                                                               -         (2,142,845)          (357,144)
    Changes in operating assets and liabilities-
       (Increase) decrease in trade receivable                               180,743           (146,574)             7,547
       (Increase) decrease in due from members'                              549,947           (173,182)           984,610
       (Increase) decrease in inventory                                      (81,829)            26,962              6,269
       (Increase) decrease in prepaid expenses and other current
          assets                                                              41,212            (39,227)           (51,062)
       (Increase) decrease in due from affiliate                          14,402,010        (14,402,010)                 -
       Decrease in other assets                                                5,477            155,777             (5,015)
       Increase (decrease) in accounts payable                              (990,074)           605,507           (443,519)
       Increase (decrease) in accrued expenses                               (35,114)           181,523            143,937
       Increase in due to members'                                           558,469                  -                  -
                                                                        ------------       ------------       ------------
        Net cash flows (used in) provided by operating activities         14,630,863        (13,790,824)           611,987
                                                                        ------------       ------------       ------------

CASH FLOWS FROM INVESTING ACTIVITIES --
    Purchases of property, plant and equipment, net                         (145,196)        (1,688,037)        (1,187,530)
                                                                        ------------       ------------       ------------

CASH FLOWS FROM FINANCING ACTIVITIES --
    Capital distributions, net of contributions                           (7,355,775)         8,573,811            490,662
    Member advance                                                        (7,099,167)         7,099,167                  -
                                                                        ------------       ------------       ------------
                 Net cash flows provided by financing activities         (14,454,942)        15,672,978            490,662
                                                                        ------------       ------------       ------------
                 Net increase (decrease) in cash                              30,725            194,117            (84,881)

CASH BEGINNING OF PERIOD                                                     286,921             92,804            177,685
                                                                        ------------       ------------       ------------

CASH END OF PERIOD                                                      $    317,646       $    286,921       $     92,804
                                                                        ============       ============       ============
</TABLE>

     The accompanying notes to financial statements are an integral part of
                               these statements.

                                      F-71

<PAGE>

1. ORGANIZATION AND OPERATIONS

Trump Indiana, Inc. ("Trump Indiana") and The Majestic Star Casino, LLC
("Barden"), the two holders of certificates of suitability for the Gary, Indiana
riverboat casinos, formed Buffington Harbor Riverboats, L.L.C. ("BHR") on
September 27, 1995 and have entered into an agreement (the "BHR Agreement")
relating to the joint ownership, development and operation of all common land
based and waterside operations in support of the Trump Indiana and Barden
riverboat casinos. Under the BHR agreement, BHR acquired property and
constructed common roadways, utilities and other infrastructure improvements on
BHR's property.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

Revenue Recognition

Under the terms of the BHR agreement, all expenditures requiring a cash outlay
by BHR are billed to Trump Indiana and Barden at cost. Accordingly, BHR records
as expenses the cost of providing such services and records as other revenues
the amounts billed to Trump Indiana and Barden.

Property, Plant and Equipment

Property, plant and equipment is carried at cost. Property, plant and equipment
is depreciated on the straight-line method using rates based on the following
useful lives-

<TABLE>
<S>                                                            <C>
     Land improvements                                         15 years
     Building                                                  40 years
     Building improvements                                      5 - 10  years
     Harbor improvements                                       10 - 15  years
     Furniture, fixtures and equipment                          5 years
</TABLE>

Income Taxes

BHR makes no provision (benefit) for income taxes since taxable income (loss) is
allocated to the members for inclusion in their respective income tax returns.

Long-Lived Assets

BHR accounts for long-lived assets under the provisions of Statement of
Financial Accounting Standard No. 121, "Accounting for the Impairment of
Long-Lived Assets" ("SFAS No. 121"). SFAS No. 121 requires, among other things,
that an entity review its long-lived assets and certain related intangibles for
impairment whenever changes in circumstances indicate that the carrying amount
of an asset may not be fully recoverable. BHR does not believe that any such
changes have occurred.

                                      F-72

<PAGE>

3. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment is comprised of the following -

<TABLE>
<CAPTION>
                                                          2001            2000
                                                      ------------    ------------
<S>                                                   <C>             <C>
     Land and land improvements                       $ 34,469,021    $ 36,883,043
     Building and building improvements                 40,400,529      40,392,638
     Harbor improvements                                19,519,620      17,089,620
     Furniture, fixtures and equipment                   7,939,228       7,818,771
                                                      ------------    ------------
                                                       102,328,398     102,184,072
     Less - Accumulated depreciation                    32,678,329      27,083,702
                                                      ------------    ------------
     Total property, plant and equipment, net         $ 69,650,069    $ 75,100,370
                                                      ============    ============
</TABLE>

4. COMMITMENTS AND CONTINGENCIES

Indiana Gaming Regulations

The ownership and operation of riverboat gaming operations in Indiana are
subject to state regulation under the Riverboat Gambling Act ("Act") and the
administrative rules promulgated thereunder. The Indiana Gaming Commission
("IGC") is empowered to administer, regulate and enforce the system of riverboat
gaming established under the Act and has jurisdiction and supervision over all
riverboat gaming operations in Indiana, as well as all persons on riverboats
where gaming operations are conducted. The IGC is empowered to regulate a wide
variety of gaming and nongaming related activities, including the licensing of
suppliers to, and employees at, riverboat gaming operations and to approve the
form of ownership and financial structure of not only riverboat owner and
supplier licensees, but also their entity qualifiers and intermediary and
holding companies. Indiana regulations continue to be revised and adopted by the
IGC. The IGC has broad rulemaking power, and it is impossible to predict what
effect, if any, the amendment of existing rules or the finalization of currently
new rules might have on the operations of BHR, Trump Indiana and Barden.

Leases

Under a lease agreement assumed by BHR from Trump Indiana with Lehigh Portland
Cement Co. ("Lehigh Cement"), BHR leased certain property which is integral to
the gaming operations of Trump Indiana and Barden (the "BHR Lease"). The BHR
Lease placed certain restrictions on the use of the harbor by the riverboats of
Barden and Trump Indiana, required the reimbursement of certain costs which may
have been incurred by Lehigh Cement, and required BHR to pursue the permitting
and construction of a new harbor. The BHR Lease was rent free through December
29, 1997 and subject to certain conditions, primarily continuing progress toward
permitting and construction of a new harbor, the BHR Lease would have extended
until the earlier of December 31, 2005 or the completion of a new harbor.
Subsequent to the original 30-month term and beginning January, 1998 BHR was
required to make payments of $125,000 per month for the remainder of the lease
term. As of December 31, 1999, BHR had recorded deferred rent expense
$2,142,845.

In September 2000, Buffington Harbor Parking Associates ("BHPA"), a joint
venture owned by Trump Indiana and Barden purchased for $15,000,000 (the
"Purchase") the Lehigh Cement property which was subject to the BHR Lease, and
at such time the BHR Lease was terminated. The purchase price was financed by an
advance from BHR of $14,182,856, with interest at 6%, and through the sale of
one acre of land to BHR for approximately $817,144. In connection with the
Purchase, the members advanced $7,099,167 and contributed $7,900,833 to BHR. As
a result of the above, BHR reversed $1,874,986 of deferred rent expense into
income. This amount is reflected as a reduction of general and administrative

                                      F-73
<PAGE>

expenses in the accompanying statement of operations.

In June 2001, BHR and BHPA terminated the BHPA agreement. A new agreement was
reached between BHR, Barden and Trump Indiana in which BHR transferred half of
the loan receivable as a return of capital to Barden in the amount of 7,099,167.
Trump Indiana was assigned half of the loan receivable, $7,099,167, in
satisfaction of the advance. In addition, BHR distributed half of the
construction-in-progress payments, $343,016, made by each member to BHR in order
to finance the construction of the garage as a return of capital contribution to
both Trump Indiana & Barden.

BHR also has noncancellable office equipment and vehicle leases. Rental expense
for such noncancellable operating leases was $1,367,607 and $412,309 for 2000
and 2001, respectively. Minimum rental payments under noncancellable operating
leases are as follows-

<TABLE>
<CAPTION>
       Years Ended December 31-
<S>                                                   <C>
          2002                                        $   288,568
          2003                                             81,171
          2004                                             18,989
          2005                                              2,884
          2006                                                  -
                                                      -----------
                                                      $   391,612
                                                      ===========
</TABLE>


                                      F-74

<PAGE>
                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrants have duly caused this report to be signed on their
behalf by the undersigned, thereunto duly authorized, on July 26, 2002.

THE MAJESTIC STAR CASINO, LLC
By: Barden Development Inc., Manager

By: /s/ Don H. Barden
    ----------------------------------------------------
    Don H. Barden, President and Chief Executive Officer


THE MAJESTIC STAR CASINO CAPITAL CORP.


By  /s/ Don H. Barden
    ----------------------------------------------------
    Don H. Barden, President and Chief Executive Officer



<PAGE>
                                  EXHIBIT INDEX

Certain of the following exhibits have been previously filed with the Securities
and Exchange Commission by the Company or by Investor Holdings pursuant to the
requirements of the Securities Act of 1933 and the Securities Exchange Act of
1934. Such exhibits are identified by the parenthetical references following the
listing of each such exhibit and are incorporated herein by reference. Exhibits
previously filed by Investor Holdings are identified as such; all other
previously filed exhibits were filed by the Company. The Company's Commission
file number is 333-06489 and Investor Holdings' Commission file number is
333-81584.

Exhibit No.                Description of Document
-----------                -----------------------

2.1       Purchase and Sale Agreement dated as of November 22, 2000 by and among
          Majestic Investor, LLC, Fitzgerald's Las Vegas, Inc., 101 Main Street
          Limited Liability Company, Fitzgerald's Mississippi, Inc.,
          Fitzgerald's Gaming Corporation and certain affiliates of the
          foregoing parties, as amended by the First Amendment thereto dated as
          of December 4, 2000 (Form 10-K for the year ended December 31, 2000)

2.2       Second Amendment to Purchase and Sale Agreement dated as of November
          1, 2001 by and among Majestic Investor Holdings, LLC, Majestic
          Investor, LLC, Barden Nevada Gaming, LLC, Barden Mississippi Gaming,
          LLC, Barden Colorado Gaming, LLC, Fitzgeralds Las Vegas, Inc., 101
          Main Street Limited Liability Company, Fitzgeralds Mississippi, Inc.
          and Fitzgeralds Gaming Corporation (Form 8-K filed December 13, 2001)

3.1       Amended and Restated Articles of Organization of The Majestic Star
          Casino, LLC (Registration Statement No. 333-06489)

3.2       Third Amended and Restated Operating Agreement of The Majestic Star
          Casino, LLC dated as of March 29, 1996 (Registration Statement No.
          333-06489)

3.3       First Amendment of Third Amended and Restated Operating Agreement of
          The Majestic Star Casino, LLC, dated as of June 18, 1999 (Registration
          Statement No. 333-85089)

3.4       Articles of Incorporation of The Majestic Star Casino Capital Corp.
          (Registration Statement No. 333-85089)

3.5       Bylaws of The Majestic Star Casino Capital Corp. (Registration
          Statement No. 333-85089)

4.1       Indenture dated as of June 18, 1999 by and among The Majestic Star
          Casino, LLC, The Majestic Star Casino Capital Corp., and IBJ Whitehall
          Bank & Trust Company, as Trustee (Registration Statement No.
          333-85089)

4.2       Security Agreement dated as of June 18, 1999 by and between The
          Majestic Star Casino, LLC and IBJ Whitehall Bank & Trust Company
          (Registration Statement No. 333-85089)

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<PAGE>

4.3       Trademark Security Agreement dated as of June 18, 1999 by and between
          The Majestic Star Casino, LLC and IBJ Whitehall Bank & Trust Company
          (Registration Statement, No. 333-85089)

4.4       Preferred Ship Mortgage dated as of June 18, 1999 made by The Majestic
          Star Casino, LLC in favor of IBJ Whitehall Bank & Trust Company
          (Registration Statement No. 333-85089)

4.5       Pledge Agreement dated as of June 18, 1999 by and between The Majestic
          Star Casino, LLC and IBJ Whitehall Bank & Trust Company (Registration
          Statement No. 333-85089)

4.6       Pledge Agreement dated as of June 18, 1999 by and among Barden
          Development, Inc., Gary Riverboat Gaming, LLC, and IBJ Whitehall Bank
          & Trust Company (Registration Statement No. 333-85089)

4.7       Loan and Security Agreement dated as of August 2, 1999 by and between
          The Majestic Star Casino, LLC and Foothill Capital Corporation (Form
          10-Q for the quarter ended September 30, 1999)

4.8       Indenture dated as of December 6, 2001 between Majestic Investor
          Holdings, LLC, Majestic Investor Capital Corp., as issuers, Barden
          Colorado Gaming, LLC, Barden Mississippi Gaming, LLC and Barden Nevada
          Gaming, LLC, as subsidiary guarantors, and the Bank of New York, as
          Trustee (Investor Holdings Registration Statement No. 333-81584)

4.9       Registration Rights Agreement dated as of December 6, 2001 among
          Majestic Investor Holdings, LLC, Majestic Investor Capital Corp.,
          Barden Colorado Gaming, LLC, Barden Mississippi Gaming, LLC and Barden
          Nevada Gaming, LLC, as guarantors, and Jefferies & Company, Inc.
          (Investor Holdings Registration Statement No. 333-81584)

4.10      Guarantee dated as of December 6, 2001 of Barden Mississippi Gaming
          LLC, Barden Colorado Gaming, LLC and Barden Nevada Gaming, LLC.
          (Investor Holdings Registration Statement No. 333-81584)

4.11      Pledge and Security Agreement dated as of December 6, 2001 by and
          among Majestic Investor Holdings, LLC, Majestic Investor Capital
          Corp., Barden Colorado Gaming, LLC, Barden Mississippi Gaming, LLC,
          Barden Nevada Gaming, LLC and The Bank of New York (Investor Holdings
          Registration Statement No. 333-81584)

4.12      Pledge Agreement dated as of December 6, 2001 by and between Majestic
          Investor, LLC and The Bank of New York (Investor Holdings Registration
          Statement No. 333-81584)

4.13      Trademark Security Agreement dated as of December 6, 2001 by and among
          Majestic Investor Holdings, LLC, Majestic Investor Capital Corp.,
          Barden Colorado Gaming, LLC, Barden Mississippi Gaming, LLC, Barden
          Nevada Gaming, LLC and The Bank of New York (Investor Holdings
          Registration Statement No. 333-81584)

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<PAGE>

4.14      First Preferred Vessel Mortgage, dated as of December 6, 2001 by and
          between Barden Mississippi, LLC and The Bank of New York (Investor
          Holdings Registration Statement No. 333-81584)

4.15      Deed of Trust, Security Agreement and Fixture Filing with Financing
          Statement and Assignment of Rents by and among Barden Mississippi
          Gaming, LLC as Trustor, Jim B. Tohill as Trustee and The Bank of New
          York as Beneficiary, dated as of December 6, 2001 (Investor Holdings
          Registration Statement No. 333-81584)

4.16      Deed of Trust, Security Agreement and Fixture Filing with Assignment
          of Rents by and among Barden Nevada Gaming, LLC as Trustor, Fidelity
          National Title Agency of Nevada, Inc. as Trustee, and The Bank of New
          York as Beneficiary, dated as of December 6, 2001 (Investor Holdings
          Registration Statement No. 333-81584)

4.17      Deed of Trust, Security Agreement and Fixture Filing with Assignment
          of Rents by and among Barden Colorado Gaming, LLC as Trustor, The
          Public Trustee of the County of Gilpin, State of Colorado as Trustee,
          and The Bank of New York as Beneficiary, dated as of December 6, 2001
          (Investor Holdings Registration Statement No. 333-81584)

4.18      Intercreditor Agreement, dated as of December 6, 2001 between The Bank
          of New York and Foothill Capital Corporation (Investor Holdings
          Registration Statement No. 333-81584)

4.19      Loan and Security Agreement dated as of December 6, 2001 by and among
          Majestic Investor Holdings, LLC, Barden Colorado Gaming, LLC, Barden
          Mississippi Gaming, LLC, Barden Nevada Gaming, LLC and Foothill
          Capital Corporation (Investor Holdings Registration Statement No.
          333-81584)

4.20      Loan and Security Agreement dated as of December 6, 2001, by Majestic
          Investor, LLC, Fitzgeralds Las Vegas, Inc., 101 Main Street Limited
          Liability Company, Fitzgeralds Mississippi, Inc., Fitzgeralds Gaming
          Corporation and certain affiliates of the foregoing parties dated as
          November 22, 2000 (Investor Holdings Registration Statement No.
          333-81584)

4.21      General Continuing Guaranty dated as of December 6, 2001, by Majestic
          Investor Holdings, LLC, Majestic Investor Capital Corp., Barden
          Colorado Gaming, LLC, Barden Mississippi Gaming, LLC and Barden Nevada
          Gaming, LLC, in favor of Foothill Capital Corporation (Investor
          Holdings Registration Statement No. 333-81584)

4.22      Guarantor Security Agreement dated as of December 6, 2001 by Majestic
          Investor Holdings, LLC and Majestic Investor Capital Corp. in favor of
          Foothill Capital Corporation (Investor Holdings Registration Statement
          No. 333-81584)

4.23      First Preferred Vessel Mortgage, dated as of December 6, 2001 by
          Barden Mississippi Gaming, LLC in favor of Foothill Capital
          Corporation (Investor Holdings Registration Statement No. 333-81584)

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<PAGE>

4.24      Deed of Trust, Security Agreement and Fixture Filing with Financing
          Statement and Assignment of Rents by and among Barden Mississippi
          Gaming, LLC as Trustor, Jim B. Tohill as Trustee and Foothill Capital
          Corporation as Beneficiary, dated as of December 6, 2001 (Investor
          Holdings Registration Statement No. 333-81584)

4.25      Deed of Trust, Security Agreement and Fixture Filing with Financing
          Statement and Assignment of Rents by and among Barden Nevada Gaming,
          LLC as Trustor, Fidelity National Title Agency of Nevada, Inc. as
          Trustee, and Foothill Capital Corporation as Beneficiary, dated as of
          December 6, 2001 (Investor Holdings Registration Statement No.
          333-81584)

4.26      Deed of Trust, Security Agreement and Fixture Filing with Financing
          Statement and Assignment of Rents by and among Barden Colorado Gaming,
          LLC as Trustor, The Public Trustee of the County of Gilpin, State of
          Colorado as Trustee, and Foothill Capital Corporation as Beneficiary,
          dated as of December 6, 2001 (Investor Holdings Registration Statement
          No. 333-81584)

4.27      Stock Pledge Agreement dated as of December 6, 2001 between Majestic
          Investor Holdings, LLC and Foothill Capital Corporation (Investor
          Holdings Registration Statement No. 333-81584)

4.28      Guarantor Trademark Security Agreement dated as of December 6, 2001
          between Majestic Investor Holdings, LLC and Foothill Capital
          Corporation (Investor Holdings Registration Statement No. 333-81584)

4.29      Subordination of First Preferred Vessel Mortgage Upon Fitzgeralds
          Tunica (Official No. 262757) (Investor Holdings Registration Statement
          No. 333-81584)

4.30      Subordination Agreement dated as of December 6, 2001 by Barden
          Mississippi Gaming, LLC and The Bank of New York, in favor of Foothill
          Capital Corporation (Investor Holdings Registration Statement No.
          333-81584)

4.31      Subordination Agreement dated as of December 6, 2001 by Barden
          Colorado Gaming, LLC and The Bank of New York, in favor of Foothill
          Capital Corporation (Investor Holdings Registration Statement No.
          333-81584)

4.32      Subordination Agreement dated as of December 6, 2001 by Barden Nevada
          Gaming, LLC and The Bank of New York, in favor of Foothill Capital
          Corporation (Investor Holdings Registration Statement No. 333-81584)

10.1*     Employment Agreement dated October 22, 2001 between Don H. Barden and
          The Majestic Star Casino, LLC (Investor Holdings Registration
          Statement No. 333-81584)

10.2*     Employment Agreement dated October 22, 2001 between Michael E. Kelly
          and The Majestic Star Casino, LLC (Investor Holdings Registration
          Statement No. 333-81584)

                                      E-4
<PAGE>

10.3      Management Agreement dated as of June 9, 1999 between Barden
          Development, Inc. and the Company (Form 10-K for the year ended
          December 31, 1999)

10.4      Expense Reimbursement Agreement dated as of October 22, 2001 between
          Majestic Investor Holdings, LLC and The Majestic Star Casino, LLC
          (Investor Holdings Registration Statement No. 333-81584)

10.5      Contribution and Assignment Agreement by and between Majestic
          Investor, LLC and Majestic Investor Holdings, LLC dated as of
          September 27, 2001 (Investor Holdings Registration Statement No.
          333-81584)

10.6      Berthing Agreement dated as of April 23, 1996 between The Majestic
          Star Casino, LLC and Buffington Harbor Riverboats, LLC (Registration
          Statement No. 333-06489)

10.7      First Amended and Restated Operating Agreement of Buffington Harbor
          Riverboats, LLC made as of October 31, 1995 by and between Trump
          Indiana, Inc. and The Majestic Star Casino, LLC, as amended
          (Registration Statement No. 333-06489)

10.8      Equipment Financing Agreement dated April 5, 1996 by and between the
          Company and International Gaming Technology (Registration Statement
          No. 333-06489)

10.9      Equipment Financing Agreement dated May 5, 1996 by and between the
          Company and International Gaming Technology (Registration Statement,
          No. 333-06489)

10.10     Equipment Financing Agreement dated September 15, 1997 by and between
          the Company and PDS Financial Corporation (Form 10-K for the period
          ended December 31, 1997)

10.11     Equipment Financing Agreement dated October 27, 1997 by and between
          the Company and PDS Financial Corporation (Form 10-K for the period
          ended December 31, 1997)

21.1      List of Subsidiaries of The Majestic Star Casino, LLC

99.1      Letter to Commission Pursuant to Temporary Note 3T

_________________________

* Identifies current management contracts or compensatory plans or arrangements.

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