SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                   FORM 10-K
   XAnnual  Report  pursuant to Section 13 or 15(d) of the Securities Exchange
Act  of  1934  For  Fiscal  Year  Ended  December  31,  1997  or
Transition  Report pursuant to Section 13 or 15 (d) of the Securities Exchange
Act  of  1934  For  the  transition  period  from  ______  to  ______
Commission  File  No.  333-145352
                         JEFFERSON CASINO CORPORATION
            (Exact name of Registrant as specified in its charter)
     Louisiana            72-1310739
     (State  or  other  jurisdiction  of          (I.R.S.  Employer
     incorporation  or  organization)          Identification  Number)
             711 Casino Magic Drive, Bay Saint Louis, MS    39520
            (Address of principal executive offices)    (Zip Code)
      Registrant's telephone number, including area code: (228) 467-9257
          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
such  filing  requirements  for  the  past  90  days.    Yes  XNo
The  aggregate  market value of the voting stock held by non-affiliates of the
Registrant was $0 as of March 28, 1998.  As of the close of business March 28,
1998, there were 1,000 shares of the Registrant's common stock outstanding all
of  which  were  held  by  affiliates.
THE  REGISTRANT  MEETS  THE  CONDITIONS  SET  FORTH  IN  GENERAL  INSTRUCTION
(I)(1)(A)(B)  OF  FORM 10-K AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE  FORMAT.

<PAGE>
INDEX
     PAGE
                                    PART I
Item  1.  -          BUSINESS          1
Item  2.  -          PROPERTIES          7
Item  3.  -          LEGAL  PROCEEDINGS          7
Item  4.  -          SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS     7
                                    PART II
Item  5.  -          MARKET  FOR  REGISTRANT'S  COMMON  EQUITY  AND  RELATED
     STOCKHOLDER  MATTERS          8
Item  6.  -          SELECTED  FINANCIAL  DATA          8
Item  7.  -          MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
     CONDITION  AND  RESULTS  OF  OPERATIONS          8
Item  8.  -          FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA        11
Item  9.  -          CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS
     ON  ACCOUNTING  AND  FINANCIAL  DISCLOSURE          11
                                   PART III
Item  10  -          DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT     11
Item  11  -          EXECUTIVE  COMPENSATION          11
Item  12  -          SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL
     OWNERS  AND  MANAGEMENT          11
Item  13  -          CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS     11
                                    PART IV
Item  14  -          EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES,
     AND  REPORTS  ON  FORM  8-K          12
     CONSOLIDATED  FINANCIAL  STATEMENTS          F-1
EXHIBITS








                                      ii

<PAGE>
                                    PART 1
ITEM  1.          BUSINESS
GENERAL
In  May  1996  ("Inception"), Casino Magic Corp. ("Casino Magic"), through its
wholly-owned  subsidiary,  Jefferson Casino Corporation. ("Jefferson Corp." or
the  "Company")  acquired  Crescent  City  Development Corporation, ("Crescent
City")  for $50 million plus the assumption of up to $5.7 million in equipment
liabilities.    Jefferson Corp. paid $15 million in cash at closing and caused
Crescent  City  to  issue  $35  million  of  11.5%  secured, three year notes.
Crescent  City was the subject of a plan of reorganization under Chapter 11 of
the U.S. Bankruptcy Code in 1996, and owned the Crescent City Queen ("Crescent
City  Riverboat"),  a  cruising  riverboat outfitted for gaming.  In addition,
Crescent  City  owned  a  license  to  conduct  riverboat gaming operations in
Louisiana, as well as gaming, surveillance and other gaming related equipment.
When Crescent City emerged from the bankruptcy proceedings in May 1996, it was
acquired  by  Jefferson  Corp.  and  renamed  Casino Magic of Louisiana, Corp.
(referred  to  herein  as  "Louisiana  Corp.")    Although Jefferson Corp. was
required  to  purchase  the  Crescent  City  Riverboat to obtain the Louisiana
gaming  license,  the  Crescent  City  Riverboat  could  not be used at Casino
Magic-Bossier  City  because of its width.  Therefore, the Company purchased a
casino  riverboat  (the  "Bossier  Riverboat") for use at Casino Magic-Bossier
City  for $20 million.  The Company sold the Crescent City Riverboat, and will
use  the  $11.7  million  in  net  proceeds  to  assist in funding the further
development  of  Casino  Magic-Bossier  City.
The  Company  opened  Casino  Magic-Bossier  City  on  October 4, 1996 using a
temporary  boarding  facility,  and on December 31, 1996, opened the permanent
land-based  pavilion.    The  facility  includes a 30,000 square feet floating
dockside  casino,  a  55,000  square  foot  entertainment,  food  and beverage
pavilion,  a  four-story,  1,500 space parking garage, and surface parking for
400  cars.   The Company has completed the architectural and engineering plans
and  has  broken  ground  for  the  construction  of  a 188-room hotel and the
expansion  of  the  pavilion  area.    The expanded pavilion and the hotel are
planned to include a themed steak and seafood restaurant, a bar and a swimming
pool.  The development and construction of the hotel and pavilion improvements
are  largely  dependent  upon  the proceeds from the sale of the Crescent City
Riverboat  and future operating cash flow of Casino Magic-Bossier City.  There
is no assurance that the proceeds from the sale of the Crescent City Riverboat
and  the  cash  flow  from the operations of Casino Magic-Bossier City will be
sufficient  to  complete  the  planned  projects.
Prior  to  Inception,  Jefferson Corp. had no business activities and Crescent
City  was a wholly owned subsidiary of Capital Gaming International, Inc. with
which  Jefferson  Corp. had no affiliation.  The original agreement to acquire
Crescent  City was entered into by Jefferson Corp. and C-M of Louisiana, Inc.,
the  latter  being  another  wholly  owned  subsidiary of Casino Magic. C-M of
Louisiana,  Inc.  was the fee owner of approximately 20 acres of land with 900
feet  of  shoreline  on the Red River in Bossier City, Louisiana (the property
that is being used as the gaming site for Casino Magic-Bossier City).  Another
wholly owned subsidiary of Casino Magic, Coastal Land of Florida, Inc., held a
99-year  lease  on  the  Casino  Magic-Bossier City property. Casino Magic had
acquired  C-M  of Louisiana, Inc. and Coastal Land of Florida, Inc. on October
26, 1995 in anticipation of obtaining a gaming license and establishing gaming
operations  at  the Bossier City property.  Immediately prior to or as part of
the acquisition of Crescent City, the lease was canceled and C-M of Louisiana,
Inc.  was  merged  into  Jefferson Corp.  As a result, when the acquisition of
Crescent  City  was completed, Jefferson Corp. held all ownership interests in
the  Bossier  City  property  and  all  of  the capital stock of Crescent City
(which,  renamed,  is  Louisiana  Corp.).    In  August  1996, Jefferson Corp.
contributed  all  of  its  Bossier  City  property, which constituted its only
material  assets other than the capital stock of Louisiana Corp., to Louisiana
Corp.,  its  subsidiary,  and  Louisiana  Corp.  assumed  and  paid  the  only
significant  liability  of  Jefferson  Corp.
The  Company  believes  the  Bossier City/Shreveport Market presents it with a
significant  gaming  development  opportunity based upon the strong population
density  of  its  target  market  (which  includes  the  Dallas-Fort  Worth
metropolitan area, for which the Bossier City/Shreveport Market is the nearest
current gaming market) and the current regulations allowing dockside riverboat
gaming  in  Bossier City/Shreveport. The Bossier City/Shreveport Market is the
only  market  in  Louisiana  that currently permits continuous dockside gaming
without requiring cruising or simulated cruising schedules. This allows Casino
Magic-Bossier City to operate 24 hours a day with uninterrupted and convenient
casino  access  for  gaming  patrons.

                                       1

<PAGE>
Unless  the context requires otherwise, reference in this Annual Report to the
"Company"  means  Jefferson Corp. which was incorporated under the laws of the
State  of  Louisiana.    In  August 1996 the Company entered into a Management
Agreement  with  Casino  Magic  and  Casino  Magic  Management  Services  (the
"Manager")  for a term through August 22, 2006, pursuant to which Casino Magic
licensed  the  "Casino  Magic"  name  to  the Company and the Manager provides
management  services  to  the  Company.  The Company's principal executive and
administrative offices are located at 711 Casino Magic Drive, Bay Saint Louis,
Mississippi  39520.    The  Company's  telephone  number  is  (228)  467-9257.
OTHER
PROPOSED  MERGER
On  February  19,  1998,  Casino  Magic  entered into an Agreement and Plan of
Merger  (the  "Merger Agreement") with Hollywood Park, Inc. ("Hollywood"), and
Acquisition II, Inc. ("HP") a wholly-owned subsidiary of Hollywood.  Under the
Merger  Agreement,  Casino  Magic  has  agreed,  subject to approval of Casino
Magic's  shareholders,  to merge (the "Merger") with HP.  Upon consummation of
such  Merger  Casino  Magic  will  be  the  surviving entity and will become a
wholly-owned  subsidiary of Hollywood.  The separate existence of HP will then
cease.  Upon consummation of the Merger, the shareholders of Casino Magic will
be entitled to receive $2.27 for each share of Casino Magic's stock held.  All
shareholders  of  Casino  Magic will be entitled to dissent from the Merger in
accordance  with  the  provisions  of  Minnesota  law.
The  Merger is subject to the approval of Casino Magic's shareholders prior to
October  31,  1998,  and to the approval of the Mississippi Gaming Commission,
the  Nevada  Gaming  Commission,  and the Louisiana Gaming Control Board.  The
Merger  is  also  contingent  upon other matters, including a requirement that
neither  Casino  Magic  nor  Hollywood  has  materially breached any warranty,
representation or covenant contained in the Merger Agreement prior to the time
of  the  Merger.    If the Merger Agreement is terminated for certain reasons,
including  a  voluntary  termination  by  Casino  Magic  should  the  Board of
Directors  of  the  Company determine to accept a proposal of another party to
merge  with  or acquire Casino Magic on terms which it believes to be superior
to  those  contained in the Merger Agreement, Casino Magic will be required to
pay  Hollywood  $3,500,000.
The  Merger  Agreement  restricts  the  ability  of  Casino Magic to engage in
certain  transactions  prior to the time of the Merger, except those which are
in  the  ordinary  course  of  business  consistent with past practice, unless
Casino  Magic  obtains  the  consent  of  Hollywood,  which consent may not be
unreasonably  withheld.  These provisions, among other things, preclude Casino
Magic from issuing any additional capital stock or options to purchase capital
stock,  entering  into  employment agreements, increasing the benefits payable
under existing severance or termination pay policies or agreements, increasing
compensation to directors or employees, declaring dividends, redeeming capital
stock,  adopting  or  terminating  any  employee benefit plan, and doing other
things which are not in the ordinary course of business.  The Merger Agreement
also  imposes  limits  on  the capital expenditures and borrowing which Casino
Magic  and its subsidiaries may effect, which are not inconsistent with Casino
Magic's  current  plans.
The proposed Merger will be a Change of Control (as defined in the Indentrue):
accordingly  if  the Merger is consummated,, each Holder of the Company's $115
million outstanding principal amount of 13% First Mortgage Notes due 2003 with
Contingent  Interest  ("First  Mortgage Notes") will have the right to require
the  Company  to  repurchase  all  or any part (equal to $1,000 or an integral
multiple  thereof)  at  an  offer price in cash equal to 101% of the aggregate
principal  amount thereof plus accrued and unpaid interest, if any, thereon to
the  date  of repurchase.  Within 30 days following any Change of Control, the
Company  will  mail  a  notice  to  each  Holder describing the transaction or
transactions  that constitute the Change of Control and offering to repurchase
the  First Mortgage Notes pursuant to the procedures required by the Indenture
and  described  in such notice.  The Company will comply with the requirements
of  Rule  14e-1  under  the  Exchange  Act  and  any other securities laws and
regulations  thereunder to the extent such laws and regulations are applicable
in  connection  with  the  repurchase  of  the  First  Mortgage  Notes.
There  is no assurance that all the necessary approvals for the Merger will be
obtained,  or  that  the  Merger  will  be  consummated  as  proposed.
FINANCIAL  INFORMATION  REGARDING  SEGMENTS
See "Item 6.-SELECTED FINANCIAL DATA," "Item 14.-EXHIBITS, FINANCIAL STATEMENT
SCHEDULES,  AND  REPORTS  ON  FORM  8-K"  and  the  Consolidated Statements of
Operations,  page  F-3  in  the  1997  Financial  Statements.

                                       2

<PAGE>
MARKETS  AND  MARKETING
Casino  Magic-Bossier  City  is  one  of  four  casinos  operating  in  the
Shreveport/Bossier  City,  Louisiana  metropolitan area.  Casino Magic-Bossier
City's  primary  market is the 6.8 million adults residing within 200 miles of
Bossier  City, including persons residing in the Dallas-Forth Worth area which
is  located approximately 180 miles west of Casino Magic-Bossier City.  Casino
Magic-Bossier  City's  location  provides customers from the Dallas-Fort Worth
market  direct  access  from Interstate Highway 20, the major east-west artery
connecting  Dallas-Fort  Worth to Bossier City.  Other cities within 200 miles
of Casino Magic-Bossier City include Longview, Texas, Tyler, Texas and Monroe,
Louisiana.
The  Company's  marketing programs consist of a variety of advertising, direct
mail  and promotional programs intended to encourage more repeat visits to the
Company's facilities.  The Company's domestic marketing efforts utilize a wide
variety  of  media  including  television, radio, newspaper, and outdoor along
with  direct  mail  advertising  of  its  Magic  Money  Player's Club, special
promotions,  events  and  entertainment, and a motor coach program.  The Magic
Money  Player's  Club  is  the  most  important marketing tool utilized by the
Company.    Similar to a frequent flier airline card or cash back credit card,
it  promotes  customer loyalty and frequent use.  Player's Club members can be
targeted  for  direct-mail  offers  and  promotions, along with information on
upcoming  events,  entertainment  schedules, current membership incentives and
photos of recent winning patrons.  The Magic Money Player's Club also provides
benefits to the customer such as cash rewards, club perquisites and a sense of
belonging.    Because gaming members earn points that are redeemable for cash,
the  Magic Money Player's Club provides an effective way to give back to loyal
customers  a portion of their play.  The reward levels are viewed as goals for
the  member  and  therefore  increase  length of stay and frequency of visits.
Active  members  with  high  play  levels are also rewarded with complimentary
entertainment  and  event  tickets  as well as free dining and lodging.  Since
other  competing  casinos  have similar "clubs", the perceived quality of such
clubs  is  an  important  marketing  factor.
Casino Magic-Bossier City actively promotes motorcoach group package programs.
Intended  to maintain customer volume during traditionally non-peak times, bus
programs  originate  at  locations  50  to  250  miles  from the property, are
completed  in one day, and are generally organized by one of the participants.
Professional  tour  operators  also  organize  bus  trips  which  originate at
locations  more  than 250 miles from the Casino.  These motorcoach groups will
typically  spend  one  or  more  nights  away  from  home.
SEASONALITY
The  Company's  current  gaming operations, are subject to seasonal variation.
Gaming  revenues  typically  increase  in  the  summer  months.
COMPETITION
GENERAL
Thirteen  of the fifteen available riverboat gaming licenses have been awarded
and  have  operating  casinos  in  Louisiana,  all  of which have opened since
September  1993.    Of  these  thirteen  riverboat casinos, four are currently
licensed  and  operate  in  the  Bossier  City/Shreveport  market  and  offer
substantially  similar  gaming  facilities.    Casino Magic-Bossier City faces
competition  from  those  existing operations, particularly to the extent that
they  add  to  or enhance existing amenities.  For example, Binion's Horseshoe
Casino  has  completed  construction  of  a  606-room  all suites hotel at its
riverboat  casino location in Bossier City.  In addition, Horseshoe Casino has
replaced  its  original  casino  riverboat  with  a  new riverboat that offers
significantly  expanded  gaming and non-gaming areas.  This expanded riverboat
in  conjunction  with  the  new  hotel  gives  Horseshoe  casino a significant
advantage  in  the Bossier City/Shreveport market.  Another casino operator in
the  area  has  begun  construction  of  an  onsite  hotel.
On  June  1997,  the  Louisiana  legislature  passed  a bill which would allow
racetracks  in  Saint  Landry,  Calcasieu and Bossier parishes to install slot
machines.    The  Governor of Louisiana has signed the billand pursuant to the
Constitutional  Amendment the introduction of this new form of gaming has been
approval  by  each  affected  parish  in  a  local  referendum.  However,  new
legislation  relating  to  the  taxation  of the slot machines will need to be
passed  with  a  66%  approval  margin  in  order  to fully implement this new
legislation.    The impact of the legislation, if approved, on the Company can
not  currently  be  determined.
                                       3

<PAGE>
RISK  OF  TEXAS  GAMING  LEGALIZATION
Casino  gaming  is  currently prohibited in several nearby jurisdictions which
are important to the Bossier City/Shreveport Market. As a result, residents of
these  jurisdictions, principally Texas, comprise a significant portion of the
customers  of existing gaming operations in Bossier City/Shreveport, including
Casino  Magic-Bossier  City.
Although  casino  gaming  is  not  currently  permitted in Texas and the Texas
Attorney  General  has issued an opinion that gaming in Texas would require an
amendment to the Texas Constitution, the Texas Legislature has considered from
time to time various proposals to authorize casino gaming, but to date has not
done  so.  A constitutional amendment would require a two-thirds vote of those
present  and voting in each house of the Texas Legislature and approval by the
electorate in a referendum. The legalization of casino gaming in Texas and the
opening of one or more casinos in the Dallas-Fort Worth area, which is a major
market  for  Bossier  City/Shreveport gaming operations, would have a material
adverse  effect  on  the  Company's  results  of  operations.
GAMING  REGULATION
In 1991 the Louisiana legislature enacted the Louisiana Riverboat Economic and
Gaming  Control  Act,  LSA-R.S.  4:501, et. seq. (the "Louisiana Gaming Act").
The  Louisiana  Gaming  Act authorized the licensing of up to 15 riverboats to
conduct  gaming on designated rivers and waterways.  Pursuant to the Louisiana
Gaming  Act, the Riverboat Gaming Commission (the "Louisiana Commission"), was
created  within  the Department of Public Safety and Corrections for the State
of  Louisiana.    Additionally, a riverboat gaming regulatory group within the
Louisiana  State  Police was created.  The Louisiana Gaming Commission and the
State  Police  were  authorized  to  and did promulgate the existing rules and
regulations  governing  the  licensing  and  operations  of  riverboats.
The  Louisiana  legislature  in the First Extraordinary Session, 1996, enacted
new  legislation  (the "Louisiana Board Act") which transferred the regulatory
oversight  of most gaming operations in Louisiana, including riverboat gaming,
to  the  Gaming  Control Board (the "Louisiana Board"), effective as of May 1,
1996.    The  Louisiana  Commission  was  abolished as of that same date.  The
Louisiana  Board  consists  of  nine  members  appointed  by  the  Governor of
Louisiana.
The  Louisiana  Board is empowered to regulate four forms of gaming activities
and  operations in the state: riverboat, video poker, the land-based casino in
New  Orleans,  and all state regulated aspects of Indian gaming.  (Excluded is
the  regulation and oversight of horse racing and off-track betting, the state
lottery,  and  charitable  gaming.)   Accordingly, the Louisiana Board has all
regulatory  authority,  control,  and  jurisdiction,  including investigation,
licensing,  and enforcement, and all power incidental to or necessary for such
regulatory  authority,  control  and  jurisdiction, over all aspects of gaming
activities  and  operations  as  authorized  pursuant to the provisions of the
Louisiana  Gaming  Act,  the  Louisiana  Economic  Development  and  Gaming
Corporation  Act  (Land-Based Casino in New Orleans), and the Video Draw Poker
Devices  Control  Act.
The Louisiana Board has been authorized to promulgate rules and regulations to
govern the aforesaid types of gaming in Louisiana; however, all administrative
rules  and  regulations  promulgated  by  entities  whose  powers  have  been
transferred  to  the  Louisiana Board are to be considered valid and remain in
effect  until  repealed  by  the  Louisiana  Board.
The  construction,  ownership and operation of riverboat gaming vessels is now
subject  to  regulation  by  the  Louisiana  Board.   The State Police conduct
investigations  and  audits  regarding  the  qualifications  of applicants for
licenses  or  permits  requiring  suitability  determinations,  submit  all
investigative  reports  to  the  Louisiana Board, conduct audits to assist the
Louisiana  Board,  issue certain licenses and permits in accordance with rules
adopted  by  the  Louisiana  Board, and perform all other duties and functions
necessary  for  the  efficient  and  thorough regulation and control of gaming
activities  and  operations  under  the  Louisiana  Board's  jurisdiction.
The  Louisiana Board Act did not repeal the Louisiana Gaming Act, the original
1991  statute authorizing riverboat gaming in Louisiana, but rather amended it
to  transfer  licensing and regulatory authority to the Louisiana Board and to
redefine  the  authority  of the State Police.  Otherwise the Louisiana Gaming
Act  remains  in  effect.   Accordingly, the Louisiana Gaming Act continues to
authorize  up  to 15 licenses to conduct gaming activities on riverboats, with
no  more  than  six  licenses to be granted to riverboats operating in any one
parish.
                                       4

<PAGE>
Current  Louisiana  law  limits the number of riverboat casino licenses in the
state  to  15,  all  but  one  of  which  have  been  awarded,  and limits the
concentration  of  riverboat  casino  licenses  in any one parish to six.  The
relative  success  of gaming operations in the Bossier City/Shreveport market,
as  compared  to  other  Louisiana  markets, may increase the possibility that
existing  licenses  may  be  relocated  to the Bossier City/Shreveport market.
However,  the  relocation  of  existing  licenses  to  another  parish  or  of
riverboats  within  the  same  parish  is  restricted  by  the  Constitutional
Amendment  which requires, among other things, a local parish-wide election to
approve,  by  majority  vote,  the licensing of any additional riverboats in a
parish  with  existing  licensed riverboats or the relocation of any operating
riverboat  to  a  different  berth  in  the  same  parish.
A  Constitutional  Amendment  was approved by voters statewide, which requires
local option elections in parishes before new forms of gaming may be conducted
therein or before existing forms of gaming may be conducted in new areas.  For
example,  the  Constitutional  Amendment  requires  a  local option referendum
before an additional riverboat could move into a parish, regardless of whether
such parish had authorized the continuation of riverboat gaming in such parish
in  the Louisiana Referendum.  In this respect, (i.e., relocation of riverboat
gaming  vessels to new locations) the Constitutional Amendment would appear to
be  more  restrictive than the legislation requiring the Louisiana Referendum.
Licenses  may  be and have been issued for dockside riverboat gaming along the
Red  River  in the Shreveport/Bossier City area.  Dockside gaming is presently
prohibited at other locations in the state.  A riverboat gaming license has an
initial  term  of  five  years,  with  subsequent  annual renewals thereafter.
Pursuant  to  the  decision of the State Police at a hearing held on April 30,
1996,  the  Louisiana  riverboat gaming license acquired by the Company has an
unexpired  term  of  five  years  less  the  sixty-five days that the previous
licensee  conducted  riverboat  gaming  operations.  The unexpired term of the
license  recommenced  on  October  4,  1996  the  date  that the Company began
riverboat  gaming  operations  in  Bossier  City.  The application for renewal
consists  of  a  sworn  statement  of  all  changes  in information, including
financial information, provided in any previous applications.  The transfer of
a  license is prohibited.  The Louisiana Board may restrict, suspend or revoke
a  license or permit.  Suspension or revocation of any license or permit would
have  a  material  adverse  effect  upon  the  business  of  the  Company.
Pursuant  to the existing laws, rules and regulations, the Company must submit
detailed  financial,  operating  and  other reports to the Louisiana Board and
substantially  all  loans,  leases, private sales of securities, extensions of
credit and similar financing transactions entered into by any of the Regulated
Persons  , must be reported to the Louisiana Board for prior approval or for a
determination  that the transaction does not need prior approval.  The Company
is  also  required  to  periodically  submit  detailed financial and operating
reports  to  the  Louisiana  Board and furnish any other information which the
Louisiana  Board  may  require.
The  applicant  for  a gaming license, its directors, officers, key personnel,
partners,  and  persons  holding a 5% or greater interest in the applicant and
their  spouses  will  be required to be found suitable by the Louisiana Board.
This  requires  the  filing of an extensive application to the Louisiana Board
disclosing personal, financial, criminal, business and other information.  The
applicant  is  required  to  pay  all costs of investigation.  There can be no
assurance  that such person will be found suitable by the Louisiana Board.  An
application  for licensing of an individual may be denied for any cause deemed
reasonable  by  the  Louisiana  Board.   Any individual who is found to have a
material  relationship  to  or a material involvement with, the Company may be
required  to be investigated in order to be found suitable or be licensed as a
business  associate  of  an  applicant.  Key employees, controlling persons or
others  who  exercise  significant influence upon the management or affairs of
the  Company  may  also  be deemed to have such a relationship or involvement.
If  the  Louisiana  Board  were  to  find  a director, officer or key employee
unsuitable  for licensing or unsuitable to continue having a relationship with
an  applicant,  the  applicant  would  have  to suspend, dismiss and sever all
relationships  with such person.  The applicant would have similar obligations
with  regard to any person who refuses to file appropriate applications.  Each
gaming employee must obtain a gaming employee permit which may be revoked upon
the  occurrence  of  certain  specified  events.
The  sale,  assignment,  transfer,  pledge  or disposition of securities which
represent  5%  or  more  of the total outstanding shares issued by a corporate
licensee  is subject to Louisiana Board approval.  After a license is granted,
any  person  acquiring  an  economic  interest of 5% or more in a license must
obtain  the  Louisiana Board's prior approval for the transaction.  Failure to
obtain  that approval is grounds for license revocation.  A security issued by
a  corporate  license  must  generally  disclose  these  restrictions.
                                       5

<PAGE>
If  the  Louisiana  Board  finds  that  an  individual  holder  of a corporate
licensee's  securities  or  a  director,  partner,  officer  or manager of the
licensee  is  not  qualified  pursuant  to  the  existing  laws,  rules  and
regulations,  and  if  as  a  result  the  licensee  is no longer qualified to
continue  as a licensee, it can propose action necessary to protect the public
interest,  including  the suspension or revocation of a license or permit.  It
may  also  issue,  under  penalty  of  revocation  of  license, a condition of
disqualification  naming the person and declaring that such person may not (a)
receive  dividends or interest on securities of the licensee, (b) exercise any
right conferred by securities of the licensee, (c) receive remuneration or any
other  economic  benefit  from  the  licensee  or  continue in an ownership or
economic  interest  in the licensee or remain as a director, partner, officer,
or  manager  of  the  licensee.
NON-GAMING  REGULATION
The  Company  is subject to certain federal, state and local safety and health
laws,  regulations  and  ordinances  that  apply  to  non-gaming  businesses
generally, such as the Clean Air Act, Clean Water Act, Occupational Safety and
Health  Act,  Resource  Conservation  Recovery  Act  and  the  Comprehensive
Environmental  Response,  Compensation and Liability Act.  The Company has not
made,  and  does  not anticipate making, material expenditures with respect to
such  environmental laws and regulations.  However, the coverage and attendant
compliance  costs  associated  with  such laws, regulations and ordinances may
result  in  future additional costs to the Company's operations.  For example,
in  1990  the  U.S.  Congress enacted the Oil Pollution Act to consolidate and
rationalize  mechanisms under various oil spill response laws.  The Department
of  Transportation  has proposed regulations requiring owners and operators of
certain  vessels  to  establish  through  the  U.S.  Coast  Guard  evidence of
financial  responsibility  in  the  amount of $5.5 million for clean-up of oil
pollution.    This  requirement would be satisfied by either proof of adequate
insurance  (including  self-insurance)  or  the  posting  of  a surety bond or
guaranty.
Traditional  riverboats  capable  of  cruising,  including  those that are not
required  to cruise, must comply with U.S. Coast Guard requirements as to boat
design,  on-board  facilities,  equipment, personnel and safety.  Each of them
must  hold  a Certificate of Seaworthiness or must be approved by the American
Bureau  of  Shipping ("ABS") Building Code.  The U.S. Coast Guard requirements
establish  design  standards,  set  limits on the operation of the vessels and
require  individual  licensing of all personnel involved with the operation of
the  vessels.  Loss of a vessel's Certificate of Seaworthiness or ABS approval
would  preclude  its  use  as  a  floating  casino.
All shipboard employees of the Company, even those who have nothing to do with
the  actual  operation  of  the  vessel, such as dealers, waiters and security
personnel,  may be subject to the Jones Act which, among other things, exempts
those  employees  from  state  limits  on  workers'  compensation  awards.
SERVICE  MARKS
Casino  Magic  is the owner of U.S. service mark registrations for the service
marks  "Casino  Magic  ",  "A  Cut  Above " "Casino Magic GetawaysSM",  "Magic
MoneySM",  "ABRACADABRA'S"  and "Amazing Randolphs" granted by the U.S. Patent
and  Trademark  Office  on  July  13,  1993,  June 21, 1994, October 18, 1994,
December  2, 1997, March 3, 1998 and March 3, 1998 respectively.  Casino Magic
is  also the owner of a Canadian service mark registration for "Casino Magic "
service  mark  granted  on  March 3, 1995.  The Company has filed service mark
registration  applications  for  the "Casino Magic" service mark in Greece and
Mexico.  The Company also uses and claims rights to several additional service
marks.    The  effect of the Company's service marks is to provide an identity
between the Company and its services.  U.S. service mark registrations provide
protection  for  a period of 10 years from the date of registration and may be
renewed  indefinitely  for  successive  10-year periods.  While prior use of a
service  mark  may  establish an exclusive right to its use in connection with
the  sale  of services in a particular market area, registration with the U.S.
Patent  and  Trademark  Office,  or  similar  government  agencies  in foreign
jurisdictions, provides such right throughout the United States or the foreign
jurisdiction  and  a  presumption  of damage to the Company should the mark be
infringed.   There are no assurances that any of the service marks used by the
Company,  whether  or  not  registered,  will be free from future challenge by
others  as  to  prior  use  or  as  otherwise  being  unprotectable.

                                       6

<PAGE>
PERSONNEL
As  of  January 1, 1998, the Company had approximately 958 full-time employees
and  100  part-time  employees.    The  Company's management believes that its
relationship  with  its  employees  is  good.  With the expansion of gaming in
Northwest  Louisiana,  new  competitors  are  likely  to  actively recruit the
Company's  management  and casino personnel, many of whom have been trained at
the  expense  of  the  Company.  None of the Company's employees are currently
represented  by  a  labor  union.
FORWARD  LOOKING  STATEMENTS
The  discussions  regarding  proposed  Company  developments  and  operations
included  in  "Item  1  -  BUSINESS"  contain  forward looking statements that
involve  a  number  of  risks  and  uncertainties.  In addition to the factors
discussed  above,  other  factors  that  could  cause actual results to differ
materially  are  the  following:  business conditions and growth in the gaming
industry  and  the  general economy; existing and future development by gaming
operators  competing  with  the  Company;  obtaining  and  retaining necessary
licenses or regulatory approvals; acquiring or generating funding necessary to
undertake  and  complete development plans; and other risks detailed from time
to  time  in  the  Company's  reports  filed  with the Securities and Exchange
Commission.
ITEM  2.          PROPERTY
CORPORATE  HEADQUARTERS
Pursuant  to  the  Management Agreement, the Company's principal executive and
administrative  offices  are  maintained in approximately 6,000 square feet of
office  space  at  711 Casino Magic Drive, Bay Saint Louis, Mississippi 39520.
CASINO  MAGIC-BOSSIER  CITY  PROPERTY
Casino  Magic-Bossier  City  is  located on a 23 acre site on the Red River in
Bossier  City,  Louisiana.    The  property  secures the First Mortgage Notes.
Gaming  at  Casino  Magic-Bossier  City  occurs  upon a riverboat which, while
capable  of  cruising  on  the  river, is permanently moored at the site.  The
riverboat  provides  approximately 30,000 square feet of area within which the
Company  has  located  1,004  slot machines and 40 table games.  Access to the
riverboat  is  provided  through  a  55,000 square foot service building which
includes restaurants and lounges, customer entertainment and service areas and
office  space.    Parking for Casino Magic-Bossier City is provided by a 1,500
four-story  parking  ramp  and surface parking for an additional 400 vehicles.
The  Company  has  developed  plans  for  the  expansion  of  the pavilion for
additional  restaurant  facilities and the construction of a 188 room hotel on
the  site  of  Casino  Magic-Bossier  City.  The architectural and engineering
designs  for  the  expansion of the pavilion and the hotel have been completed
and  groundwork  has  begun.
Management  believes  that  Casino Magic-Bossier City facilities and space for
expansion  are adequate for the future growth and development of the facility.
ITEM  3.          LEGAL  PROCEEDINGS
In  July  1997,  the  Company  entered  into  an  agreement  to  sell to Carlo
Corporation  ("Carlo")  the Crescent City Riverboat acquired by the Company in
connection  with its establishment of Casino Magic-Bossier City.  A deposit of
$1,000,000 was paid by Carlo under the agreement and was subject to forfeiture
as  liquidated damages if the purchase of the vessel was not completed.  Carlo
asserted  that  the  condition of the vessel excused Carlo from completing the
purchase,  and  requested  the  return of the deposit.  The Company denied the
claim and retained the deposit.  On August 29, 1997 Carlo commenced litigation
on  the  Circuit  Court  of Harrison County, Mississippi seeking return of the
deposit  and punitive damages.  The Company has answered the claim.  While the
Company's  management  can  not predict the outcome of this action, management
believes that Company was entitled to retain the deposit as liquidated damages
under  the  agreement  and  intends  to  vigorously  defend  this  action.
ITEM  4.          SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
NONE

                                       7

<PAGE>
ITEM  5.        MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDERS
MATTERS
The  common  stock  of  the  Company  is  held  by Jefferson Corp., its parent
corporation,  and  is pledged to secure the First Mortgage Notes.  There is no
market  for  the  common  equity  of  the  Company.
ITEM  6.          SELECTED  FINANCIAL  DATA
Beginning  in  April  1995,  Crescent  City conducted gaming activities in New
Orleans,  Louisiana  for  a  65-day  period before a bankruptcy proceeding was
commenced  against  it. Pursuant to the court approved Plan of Reorganization,
Crescent  City  was  acquired  by  Jefferson  Corp.  in May 1996.  Because the
Company  is  operating  in  a  different  market,  with a different vessel and
facility,  with  different  management,  ownership,  and employees and using a
different  name  and  marketing  theme, management believes that the financial
position  and  operating results of Crescent City prior to the acquisition are
not  meaningful.
The  selected  financial data of the Company presented below should be read in
conjunction  with "Management's Discussion and Analysis of Financial Condition
and  Results  of  Operations" and the consolidated financial statements of the
Company and notes thereto.  The historical statement of operations and balance
sheet  data  have  been  derived  from the financial statements of the Company
which  have  been  audited by Arthur Andersen LLP, independent auditors of the
Company.    The  Company  had  no  operations  until  the  opening  of  Casino
Magic-Bossier  City  on  October  4,  1996,  and,  accordingly, no revenues or
expenses  were  incurred  other  than interest income, expense and capitalized
interest  prior  to  October  4,  1996.    All  normal operating expenses were
capitalized  under  preopening costs until October 4, 1996, in accordance with
the  Company's  accounting  policies.
<TABLE>
<CAPTION>

(IN  THOUSANDS,  EXCEPT  PER  SHARE  DATA)          May  13,  1996  (inception)

STATEMENT OF OPERATIONS DATA                           December 31,1997     through December 31, 1996
                                                      -------------------  ---------------------------
<S>                                                   <C>                  <C>
Revenues                                              $           93,205   $                   12,738
Costs and expenses                                                87,468                       20,077
Income (loss) from operations                                      5,737                       (7,340)
Other                                                             16,379                        2,705
(Loss) before income taxes                                       (10,642)                     (10,044)
Income taxes benefit                                                  --                           --
Net (loss)                                                       (10,642)                     (10,044)
Net (loss) per share                                  $       (10,641.78)  $               (10,044.40
BALANCE SHEET DATA:                                   December 31, 1997    December 31, 1996
                                                      -------------------  ---------------------------
Working capital (deficiency)                                        (917)                       4,578
Total assets                                                     142,638                      149,330
Current liabilities (including construction payable)              23,441                       17,246
Total long-term debt, including current maturities               121,319                      121,729
Shareholder's equity                                               1,684                       12,234
</TABLE>


ITEM  7.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS
The  discussions  regarding  proposed  Company  developments  and  operations
included  in  "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS"  and  "NOTES  TO  CONDENSED  CONSOLIDATED  FINANCIAL
STATEMENTS"  contain forward looking statements that involve a number of risks
and  uncertainties.    These  forward-looking  statements  relate  to:  (i)
construction on the pavilion expansion and hotel at Casino Magic-Bossier City;
and  (ii)  the Company's ability to fund planned developments and debt service
obligations  over  the  next  twelve  months with currently available cash and
marketable  securities  and  with  cash  flow  from  operations.  Construction
projects entail significant construction risks, including, but not limited to,
cost  overruns,  delay  in  receipt  of  governmental  approvals, shortages in
materials  or  skilled  labor,  labor  disputes,  unforeseen  environmental or
engineering  problems,  work  stoppage,  fire  and  other  natural  disasters,
construction  scheduling  problems and weather interferences, any of which, if
it  occurred,  could delay construction or result in a substantial increase in
costs  to  the  Company.   The Company's ability to meet its consolidated debt
obligations  may  be dependent upon the successful completion of the hotel and
the  other planned construction projects at Casino Magic-Bossier City, and the
Company's  future operating performance, which is itself dependent on a number
of  factors,  such  as,  prevailing  economic  and  competitive  conditions,
regulatory  compliance,  and  other factors affecting the Company's operations
and business, many of which are outside of the Company's control.  In addition
to the risks and uncertainties discussed above, other factors that could cause
actual  results  to  differ  materially  are detailed from time to time in the
Company's  reports  filed  with  the  Securities  and  Exchange  Commission.
                                       8

<PAGE>
DEVELOPMENT  ACTIVITIES
On  May 13, 1996 Jefferson Corp. acquired all the outstanding capital stock of
Crescent  City  pursuant  to  the  Plan  of  Reorganization.    Crescent  City
discontinued all of its gaming activities in June 1995 after only a very brief
period of operations in the New Orleans market and its only significant assets
at  the  time  of  the  Plan  of Reorganization consisted of the Crescent City
Riverboat,  a Louisiana gaming license, and the furniture, fixtures and gaming
equipment located on the Crescent City Riverboat. As a result of the foregoing
factors  and  because  the  Company is operating in a different market, with a
different  vessel  and facility, different management and ownership and with a
different  name  and  marketing  theme, management believes that the financial
position  and  operating results of Crescent City prior to the acquisition are
not  meaningful  to  the  Company or prospective investors, and such financial
information  is  therefore  not  presented.    Pursuant  to  the  Plan  of
Reorganization,  Crescent  City  was  discharged from substantially all of its
liabilities  prior  to  the  acquisition.  From that time until the October 4,
1996  opening  of  Casino Magic-Bossier City using temporary boarding, mooring
and  paved  parking  facilities, the Company had been in the development stage
and  its  activities had been limited to arranging for the design, preliminary
site  work,  construction,  and  financing  for  Casino  Magic-Bossier  City.
A comparison of results from 1996 to 1997 is not meaningful due to the opening
of  the  facility  in  October  1996.
RESULTS  OF  OPERATIONS
YEAR  ENDED  DECEMBER  31,  1997
Gaming  revenues  at  Casino  Magic-Bossier  City were $89.5 million for 1997.
Based  upon  public  reports  made to the Louisiana Gaming Control Board, this
represents  approximately  a  17%  share  of total gaming revenues in the four
casino  Bossier City/Shreveport Market.  During 1997, the Company attempted to
increase  Casino  Magic-Bossier  City's  market  share  through  significant
marketing,  advertising  and  promotional  efforts.   However, this attempt to
strengthen  Casino  Magic-Bossier City's market share was not as successful as
anticipated.    Although  the Company continues to implement improved and cost
effective  marketing  and promotional programs to increase revenues, there can
be  no  assurance  it  will  continue  to  be  successful  in doing so.  Other
revenues, which represent food and beverage sales, were $3.7 million for 1997.
Total  costs  and  expenses  during  1997  were  $87.5  million  and  Casino
Magic-Bossier City had operating income of $5.7 million for 1997.  The Company
incurred  $8.2  million in total marketing and promotional expenses during the
first  quarter  of  1997,  including approximately $4.0 million in promotional
give-away  programs  which  were  expected  to generate a level of incremental
gaming  revenues  that  were  not  achieved.   Additionally, in the first four
months  of 1997, Casino Magic-Bossier City was incurring operating expenses at
a  level  consistent with operating a property at significantly higher revenue
levels.    Beginning  in  May  1997  the Company implemented changes to reduce
overall  operating  costs,  and  specifically marketing and promotional costs.
These  cost reductions enabled the Company to achieved positive cash flow from
operations  of  approximately  $4.6  million during the last three quarters of
1997.
Other  (income)  and  expenses were $16.4 million for 1997.  Expenses included
$17.0  million  in  interest  expense relating primarily to the First Mortgage
Notes  used  to  develop Casino Magic-Bossier City.  Additionally, included in
other  income  and  expense  are  the  gain  on  the sale of the Crescent City
Riverboat  of  approximately $1.4 million and management fees of approximately
$1.1  million.
The  Company  is  included  in  a  consolidated group subject to a tax-sharing
agreement  between  itself,  all  affiliated companies and its ultimate parent
Casino  Magic.    The difference between the 0% rate and the statutory rate of
35%  is due to a tax valuation allowance against the tax benefit recorded as a
result  of  the  tax  sharing  agreement.
Casino Magic-Bossier City incurred a net loss of $10.6 million during 1997, or
a  loss  of  $10,641  per share.  This is the result of lower than anticipated
revenues, exceptionally high advertising and promotional costs that should not
recur  in  future  periods  and  operating  costs  incurred in anticipation of
significantly  higher  revenues,  specifically  in  the first quarter of 1997.

                                       9

<PAGE>
FROM  MAY  13,  1996  (INCEPTION)  THROUGH  DECEMBER  31,  1996:
The  Company  had no operations until the opening of Casino Magic-Bossier City
on October 4, 1996.  No revenues or expenses were incurred other than interest
income, expense and capitalized interest prior to October 4, 1996.  All normal
operating  expenses  were  capitalized under preopening costs until October 4,
1996,  in  accordance  with  the  Company's  accounting policies.  The Company
anticipated  that  its  initial results might be adversely affected by opening
with  limited  facilities  while  construction was proceeding on the permanent
land-based amenities, as well as by the expensing of preopening costs.  During
the  period  from  October  4,  1996  through  December  31,  1996,  Casino
Magic-Bossier City generated revenues of approximately $12.6 million with only
limited  food,  beverage  and retail services.  Such revenues were achieved in
spite  of  the  fact  that  high  water  on  the  Red River, which flooded the
Company's  temporary  parking area, caused the casino to be closed for fifteen
days  in  November  and  December including two weekends, one the Thanksgiving
holiday  weekend.   The substantially completed permanent Casino Magic-Bossier
City  facility,  which opened on December 31, 1996, is located above the flood
plain  so  that  high  water  should  not  cause a closing in the future.  The
Company  believes that such revenue levels were also adversely affected by the
lack  of  competitive amenities during the period of operations with temporary
land  based  facilities.
Total  costs  and  expenses  for  the  period  May 13 1996 (inception) through
December 31, 1996 were $20.1 million.  These costs were significantly affected
by  several factors including: (i) most operating expenses were unusually high
as  a  percentage  of  revenues  due  to  the  15-day  closure  of  the casino
operations,  which  reduced  revenues, although the Company continued to incur
certain  payroll  and  most  other operating costs during the closure periods;
(ii)  additional  costs  incurred  because  of  opening and closing procedures
necessary  when  the  casino  twice  ceased  operations  during the high water
periods;  (iii)  clean-up costs incurred due to high water during this period.
(iv)  marketing costs increased due to efforts to inform customers of closures
and  subsequent  reopenings;  and  (v)  the  Company  incurred $6.5 million in
preopening  costs.
The  Company  incurred  $2.7  million  in  other (income) and expenses for the
period May 13, 1996 through December 31, 1996.  This consisted of $7.3 million
in  interest expense on the First Mortgage Notes.  Of this amount, the Company
capitalized  interest  of  $4.1 million relating to the construction of Casino
Magic-Bossier  City's  entertainment  facility and had interest income of $0.5
million  earned  on funds held in the Cash Collateral Accounts.  No Contingent
Interest  was  incurred  or  paid  during  this  period.
The  Company  incurred  neither  an  income  tax expense or benefit during the
period  from  May 13, 1996 through December 31, 1996.  The Company is included
in a consolidated group subject to a tax sharing agreement between itself, its
ultimate  parent  Casino  Magic  and  other  subsidiaries  thereof.
The  Company  had a net loss of $10.0 million, or $10,027.17 loss per share in
the period ended from May 13, 1996 (inception) through December 31, 1996.  The
net loss is attributable to the Company having had no operations until October
4, 1996, incurring $6.5 million in preopening costs, the closure of the casino
due  to high water for 15 days in November and December 1996, and the casino's
beginning of operations before a substantial portion of the casino's amenities
were  completed.
LIQUIDITY  AND  CAPITAL  RESOURCES
At  December  31,  1997,  the  Company  had  unrestricted  cash and marketable
securities  of  $10.7  million  compared  to  unrestricted cash and marketable
securities  of  $4.0  million  at  December  31,  1996.  The Company has $10.6
million  in  restricted  marketable securities at December 31, 1997 due to the
sale  of  the  Crescent City Riverboat.  At December 31, 1996, the Company had
$16.9  million  in restricted cash relating to the First Mortgage Notes issued
to  fund  the  construction  of  Casino  Magic-Bossier  City.
During  1997,  the  Company  generated  $1.6 million of cash flow in operating
activities  and  refinanced  approximately $3.9 million of long term equipment
debt.   The Company spent $7.2 million for acquisitions of property, equipment
and other long-term assets.  The Company plans additional investments in 1998,
but most of such additional expenditures will be subject to the ability of the
Company  to generate positive cash flows from operations, the $11.7 million in
proceeds  from  the sale of the Crescent City Riverboat or the availability of
financing.   There can be no assurance that sufficient funds will be available
for  the  Company  to  make  all  planned  improvements.

                                      10

<PAGE>
The  Company  opened  Casino  Magic-Bossier  City  on  October 4, 1996 using a
temporary  boarding  facility,  and on December 31, 1996, opened the permanent
facility.    The  Company  plans  to  expand  the pavilion and to construct an
approximately  188-room  convention  hotel  and  related  amenities, including
restaurants and a swimming pool.  The construction of the hotel is expected to
be funded primarily by the $11.7 million in proceeds received from the sale of
the  Crescent  City  Riverboat  and  the  future operating cash flow of Casino
Magic-Bossier  City.    No  assurances can be given that the proceeds from the
sale  of  the Crescent City Riverboat and the cash flow from the operations of
Casino Magic-Bossier City will be sufficient to develop such hotel and related
facilities  or  that  these  improvements  will  ever  be  developed.
The  First  Mortgage  Notes  are  governed  by  the  Louisiana  Indenture. The
Louisiana  Indenture  pursuant  to  which  the  First Mortgage Notes have been
issued  contains  certain covenants that will limit the ability of the Company
to,  among  other  things,  incur  additional indebtedness and issue preferred
stock,  pay  dividends,  make  investments  or make other restricted payments,
incur  liens,  enter  into  mergers or consolidations, enter into transactions
with  affiliates  or  sell  assets.
The  Company will have a significant need for cash in 1998 and beyond in order
to  continue  its  planned  development.    The Company believes that cash and
marketable  securities  at  December  31, 1997, and cash flows from operations
will  be sufficient to service its operating and debt service requirements and
beginning  of construction on the Casino Magic-Bossier City hotel and pavilion
expansion  through  at  least  the  next  twelve  months.
 ITEM  8.                    FINANCIAL  DATA  AND  SUPPLEMENTARY  DATA
The  financial statements of the Company and the notes thereto are attached to
this  Annual  Report.
ITEM  9.       CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL  DISCLOSURE
None.
                                   PART III
ITEM  10.          DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT
Omitted  pursuant  to  General  Instruction  (I)(2)(c)  to  Form  10-K.
ITEM  11.          EXECUTIVE  COMPENSATION
OMITTED  PURSUANT  TO  GENERAL  INSTRUCTION  (I)(2)(C)  TO  FORM  10-K.
ITEM  12.       SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Omitted  pursuant  to  General  Instruction  (I)(2)(c)  to  Form  10-K.
ITEM  13.          CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
In  August  1996  the  Company entered into a Management Agreement with Casino
Magic  and Casino Magic Management Services (the "Manager") for a term through
August  22,  2006,  pursuant to which Casino Magic licensed the "Casino Magic"
name  to  the  Company  and  the  Manager  provides management services to the
Company.  Casino  Magic  is  the  direct parent corporation of Jefferson Corp.
which  holds  a  100%  beneficial  ownership  interest  in  the  Company.  In
consideration  for  the  services provided under the Management Agreement, the
Company  has  agreed  to  pay  the  Manager  a  management fee equal to 10% of
Adjusted  Consolidated  Cash Flow, subject to certain limitations set forth in
the  Indenture.    The  Company accrued management fees of $1.4 million during
1997,  none  of  which  has  been  paid.
The Company and Jefferson Corp. are and all future subsidiaries of the Company
will be, parties to a Tax-Sharing Agreement (as defined herein) between Casino
Magic  and  each  of  its  domestic  subsidiaries  (the  "Consolidated Group")
pursuant  to  which  Casino  Magic will file a consolidated federal income tax
return  on  behalf  of  the Consolidated Group and timely pay the Consolidated
Group's federal income tax liability and the Company, Jefferson Corp. and each
such  future  subsidiary  will  pay  Casino  Magic  an  amount  equal to their
respective  share  of  the  Consolidated  Group's federal income tax liability
calculated  in  the  manner  prescribed  in  such  Tax-Sharing  Agreement.
                                      11

<PAGE>
                                    PART IV
ITEM  14.          FINANCIAL  STATEMENT  SCHEDULES  AND  REPORTS  ON  FORM 8-K
     (A)          FINANCIAL  STATEMENTS  OF  JEFFERSON  CASINO  CORPORATION
Report  of  Independent  Public  Accountants.
Financial  Statements:
Consolidated  Statements  of  Operations  for  the  year:
     ended  December  31,1997  and  for  the period from May 13, 1996 (date of
inception)  through
     December  31,  1996
Consolidated  Balance  Sheets  as  of  December  31, 1997 and December 31,1996
Consolidated  Statements  of  Changes  in  Equity  for the year ended December
31,1997
     and for the period from May 13, 1996 (date of inception) through December
31,  1996
Consolidated  Statements  of  Cash  Flows for the year ended December 31, 1997
     and  for the period fromMay 13, 1996 (date of inception) through December
31,  1996
Notes  to  Consolidated  Financial  Statements

(B)          REPORTS  ON  FORM  8-K
No  reports  on Form 8-K were been filed during the fourth quarter of the year
ended  December  31,  1997.
     (C)          EXHIBITs
3.1*      Amended and Restated Certificate of Incorporation of Casino Magic of
Louisiana,  Corp.
3.2*          By-laws  of  Casino  Magic  of  Louisiana,  Corp.
3.3*          Certificate  of  Incorporation  of Jefferson Casino Corporation.
3.4*          By-laws  of  Jefferson  Casino  Corporation.
4.1*      Form of the Company's 13% Notes due 2003 with Contingent Interest in
the  aggregate  principal  amount  of  $115,000,000.
4.2*          Form  of Guarantee issued on August 22, 1996 by Jefferson Casino
Corporation.
4.3*     Indenture dated as of August 22, 1996 by and among the Company, First
Union  Bank  of Connecticut, as Trustee, and the Guarantors named therein, for
the  Company's  $115,000,000  of  13%  First  Mortgage  Notes  due  2003  with
contingent  interest.
4.4*          Registration Rights Agreement dated as of August 22, 1996 by and
among  the  company,  the  Guarantors named therein and the Initial Purchasers
named  therein.
4.5*       Cash Collateral and Disbursement Agreement dated August 22, 1996 by
and  among the Company, First Union Bank of Connecticut, as Trustee, and First
National  Bank  of  Commerce,  as  disbursement  agent.
4.6*       Security Agreement dated as of August 22, 1996 by and between First
Union  Bank  of  Connecticut,  as  Trustee,  and  the  Company,  as Guarantor.
4.7*        Stock Pledge and Security Agreement dated as of August 22, 1996 by
and  between First Union Bank of Connecticut, as Trustee, and Jefferson Casino
Corporation,  as  Pledgor.
4.8*      Security Agreements dated as of August 22, 1996 by and between First
Union  Bank  of  Connecticut,  as  Trustee,  and Jefferson Casino Corporation.

                                      12

<PAGE>
4.9*     First Preferred Ship Mortgage dated as of August 22, 1996 executed in
favor  of  First  Union  Bank  of  Connecticut,  as  Trustee,  by the Company.
4.10*       First Preferred Ship Mortgage dated as of August 22, 1996 executed
in  favor  of  First  Union  Bank  of Connecticut, as Trustee, by the Company.
4.11*          Mortgage of the Company dated as of August 22, 1996 executed in
favor  of  First  Union  Bank  of  Connecticut,  as  Trustee.
4.12*          Form  of  Accounts  Pledge  Agreement.
4.13*          Note  Purchase  Agreement  dated  August  16,  1996.
4.14          Collateral  Assignment  dated  August  22,  1996.
4.15*          First  Supplement  to  the  Indenture
4.16*          First  Supplement  to  the  Security  Agreement
10.1*          Management  Agreement
10.2*          Tax-Sharing  Agreement
10.3*        Credit Agreement with First National Bank of Commerce dated March
27,  1997.
10.4*          Agreement  for  the  sale of the Crescent City Queen Riverboat.
27          Financial  Data  Schedule  (filed  electronically  only)
-          Filed  with  Form  S-4  333-14535

                                      13

<PAGE>
SIGNATURES

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

     JEFFERSON  CASINO  CORPORATION

Dated:    March  30,  1998          By:  /s/  James  E.  Ernst
     James  E.  Ernst.,  President
     and  Chief  Executive  Officer

Pursuant  to  the  requirements  of  the Securities Exchange Act of 1934, this
Report  has  been  signed  below  by  the  following  persons on behalf of the
Registrant  and  in  the  capacities  and  on  the  dates  indicated.

Signature          Title            Date

/s/  Marlin  F.  Torguson          Chairman  of  the  Board     March 30, 1998
Marlin  F.  Torguson

/s/  James  E.  Ernst          President  and  Chief          March  30,  1998
James  E.  Ernst          Executive  Officer
     (principal  executive  officer)

/s/  Jay  S.  Osman          Chief  Financial          March  30,  1998
Jay  S.  Osman          Officer  and  Treasurer  (principal
     financial  and  accounting  officer)

/s/  Roger  H.  Frommelt          Director            March  30,  1998
Roger  H.  Frommelt

/s/E.  Thomas  Welch          Director          March  30,  1998
E.  Thomas  Welch


                                      14

<PAGE>
                         INDEX TO FINANCIAL STATEMENTS
CONTENTS          PAGES
Report  of  Independent  Public  Accountants          F-2
Financial  Statements:
Consolidated  Statement  of  Operations for the yearended December 31,1997 and
     for  the  period  from  May  13,  1996  (date  of  inception)
     through  December  31,  1996          F-3
Consolidated  Balance  Sheets  as  of  December  31, 1997 and December 31,1996
F-4
Consolidated  Statements  of  Changes  in  Equity  for the year ended December
31,1997
     and for the period from May 13, 1996 (date of inception) through December
31,  1996          F-5
Consolidated  Statements  of  Cash  Flows for the year ended December 31, 1997
     and for the period from May 13, 1996 (date of inception) through December
31,  1996          F-6
Notes  to  Consolidated  Financial  Statements          F-8


<PAGE>


REPORT  OF  INDEPENDENT  PUBLIC  ACCOUNTANTS


To  JEFFERSON  CASINO  CORPORATION:

We  have  audited  the  accompanying  consolidated balance sheets of Jefferson
Casino  Corporation  (a Louisiana corporation and a wholly owned subsidiary of
Casino  Magic  Corp.)  as  of  December  31,  1997  and  1996  and the related
consolidated  statements  of  operations, changes in equity and cash flows for
the  year  ended December 31, 1997 and for  the period from inception (May 13,
1996)  through  December  31,  1996.    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  generally  accepted auditing
standards.  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  consolidated  financial  statements  referred to above
present  fairly, in all material respects, the financial position of Jefferson
Casino  Corporation  as of December 31, 1997 and 1996 and the results of their
operations  and development stage activities and their cash flows for the year
ended  December  31,  1997  and  for  the period from inception (May 13, 1996)
through  December  31,  1996  in conformity with generally accepted accounting
principles.



                                                           ARTHUR ANDERSEN LLP

New  Orleans,  Louisiana,
February  27,  1998




                                      F-2

<PAGE>
<TABLE>
<CAPTION>

                          JEFFERSON CASINO CORPORATION
                     CONSOLIDATED STATEMENTS OF OPERATIONS

                                       MAY 13, 1996
                         YEARS ENDED      (INCEPTION) THROUGH

                                          DECEMBER 31,1997    DECEMBER 31,1997
                                         ------------------  ------------------
<S>                                      <C>                 <C>
REVENUES:
   Casino                                $      89,539,940   $      12,664,451
   Food, beverage and rooms                      2,879,922                   -
   Other Operating revenues                        785,226              73,349
                                         ------------------  ------------------
                                                93,205,088          12,737,800
                                         ------------------  ------------------
COSTS AND EXPENSES:
   Casino                                       47,556,444           7,123,353
   Food and beverage                             3,608,206                   -
   Other operating costs and expenses              618,699              36,294
   Advertising and marketing                    14,998,833           1,695,039
   General and administrative                    7,234,507           2,258,779
   Property operation, maintenance and
     energy cost                                 4,975,789           1,060,727
   Rents, property taxes and insurance           2,575,905             246,169
   Depreciation and amortization                 5,899,975           1,136,883
   Preopening expenses                                   -           6,520,158
                                         ------------------  ------------------
                                                87,468,358          20,077,402
                                         ------------------  ------------------
INCOME (LOSS) FROM OPERATIONS                    5,736,730          (7,339,602)
                                         ------------------  ------------------
OTHER (INCOME) EXPENSE:
   Interest expense                             17,035,579           7,342,000
   Interest capitalized                           (107,401)         (4,147,612)
   Interest income                                (464,259)           (488,774)
   Other                                           (85,412)               (818)
                                         ------------------  ------------------
                                                16,378,507           2,704,796
                                         ------------------  ------------------
LOSS BEFORE INCOME TAXES:                      (10,641,777)        (10,044,398)
                                         ------------------  ------------------

INCOME TAX EXPENSE(BENEFIT)                              -                   -

NET LOSS                                 $     (10,641,777)  $     (10,044,398)
                                         ==================  ==================

NET LOSS PER COMMON SHARE:               $      (10,641.78)  $      (10,044.40)
                                         ==================  ==================

WEIGHTED AVERAGE COMMON SHARES - 1000


<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS.
</TABLE>


                                      F-3
<PAGE>
<TABLE>
<CAPTION>

                               JEFFERSON CASINO CORPORATION
                               CONSOLIDATED BALANCE SHEETS
                                   DECEMBER 31,      DECEMBER 31,

                                                                 1997           1996
                                                             -------------  -------------
<S>                                                          <C>            <C>
ASSETS
Current assets:
   Cash and cash equivalents                                 $ 10,675,429   $  3,959,126
   Restricted cash                                                      -     16,899,654
   Restricted marketable securities                            10,629,405              -
   Other current assets                                         1,218,886        964,997
                                                             -------------  -------------
       Total current assets                                    22,523,720     21,823,777
                                                             -------------  -------------
Property and equipment:
   Land and improvements                                       18,956,769     14,716,035
   Building and improvements                                   20,930,281              -
   Riverboat and improvements                                  22,599,897     20,427,361
   Leasehold improvements                                         111,711         74,075
   Furniture and equipment                                     18,775,297     12,239,594
   Construction in progress                                       883,291     27,105,683
                                                             -------------  -------------
                                                               82,257,246     74,562,748
     Less accumulated depreciation and amortization            (4,993,784)      (740,922)
                                                             -------------  -------------
       Total property and equipment, net                       77,263,462     73,821,826
                                                             -------------  -------------
Other long-term assets:
   Deferred gaming license cost, net of accumulated
     amortization of $2,013,838 and $395,489, respectively     38,048,426     38,337,333
   Property held for sale                                               -     10,101,182
   Debt issuance costs, net of accumulated
    amortization of $1,254,160 and $322,594 , respectively      4,710,121      5,096,981
   Deposits and other assets                                       91,820              -
   Other long-term assets                                               -        148,846
                                                             -------------  -------------
       Total other long-term assets                            42,850,367     53,684,342
                                                             -------------  -------------
                                                             $142,637,549   $149,329,945
                                                             =============  =============
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
  Notes and contracts payable                                $     76,950   $  4,486,710
   Current maturities of long-term debt                         3,714,540      1,878,605
   Accounts payable                                             3,665,071      2,837,908
   Accrued expenses                                             5,614,298        535,661
   Accrued interest                                             6,547,014      5,581,119
   Accrued payroll and related benefits                         2,942,523      1,720,191
   Accrued progressive gaming liabilities                         388,221        113,432
   Other current liabilities                                      492,123         92,123
                                                             -------------  -------------
       Total current liabilities                               23,440,740     17,245,749
                                                             -------------  -------------
Long-term debt, net of current maturities                     117,604,583    119,850,193
                                                             -------------  -------------
Commitments and contingencies
   Common stock, no par value, 10,000 shares
     authorized 1,000 issued and outstanding                            -              -
   Additional paid-in capital                                  22,278,401     22,278,401
   Retained earnings (deficit)                                (20,686,175)   (10,044,398)
                                                             -------------  -------------
       Total shareholder's equity                               1,592,226     12,234,003
                                                             -------------  -------------

                                                             $142,637,549   $149,329,945
                                                             =============  =============
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS.
</TABLE>












                                      F-4
<PAGE>
<TABLE>
<CAPTION>

                                 JEFFERSON CASINO CORPORATION
                         CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

                           Common Stock          Additional     Retained

                              Shares  Amount   Paid-in-Capital     Earnings         Total
                              ------  -------  ----------------  -------------  -------------
<S>                           <C>     <C>      <C>               <C>            <C>
Balance at May 13, 1996            -  $     -  $              -  $          -   $          -
Stock issued                   1,000        -        20,925,401             -     20,925,401
Paid-in-Capital                    -        -         1,353,000             -      1,353,000
Net Loss                           -        -                 -   (10,044,398)   (10,044,398)
                              ------  -------  ----------------  -------------  -------------
Balance at December 31, 1996   1,000  $     -  $     22,278,401  $(10,044,398)  $ 12,234,003
Net Loss                           -        -                 -   (10,641,777)   (10,641,777)
                              ------  -------  ----------------  -------------  -------------
Balance at December 31, 1997   1,000  $     -        22,278,401   (20,686,175)     1,592,226
                              ======  =======  ================  =============  =============


<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS.
</TABLE>


                                      F-5

<PAGE>
<TABLE>
<CAPTION>

                                            JEFFERSON CASINO CORPORATION
                                        CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                         MAY 13, 1996
                                                          (INCEPTION)
                                                  YEAR ENDED     THROUGH

                                                                                       DECEMBER 31,    DECEMBER 31,
                                                                                           1997            1996
                                                                                      --------------  --------------
<S>                                                                                   <C>             <C>
Cash flows from operating activities:
   Net loss                                                                           $ (10,641,777)  $ (10,044,398)
   Adjustments to reconcile net income to net cash provided by operating activities:
     Depreciation                                                                         4,281,626         740,922
     Amortization                                                                         1,618,349         395,961
     Gain on disposal of property and equipment                                          (1,439,916)           (818)
     Amortization of debt issuance costs                                                    931,567         322,594
     Preopening costs                                                                             -       6,520,158
     Increase in prepaid expenses                                                          (161,260)       (166,824)
     (Increase) decrease in notes and accounts receivable, net                             (113,311)       (345,116)
     (Increase) decrease in other current assets                                            (85,250)       (131,147)
     Increase (decrease) in accounts payable                                               (102,171)      2,180,746
     Increase (decrease) in accrued expenses                                              5,133,580         535,661
     Increase (decrease) in accrued interest                                                901,037       3,715,909
     Increase (decrease) in accrued payroll and related benefits                          1,222,331       1,720,191
     Increase other current liabilities                                                     400,000               -
     Increase (decrease) in accrued progressive gaming liabilities                          274,790         113,432
                                                                                      --------------  --------------
          Net cash provided by operating activities                                       2,219,595       5,557,271
                                                                                      --------------  --------------
Cash flows from investing activities:
     Proceeds from sale of property and equipment                                        11,707,244               -
      Acquisitions of property and equipment                                             (7,226,920)    (52,098,366)
      Acquisitions of gaming license                                                              -     (15,250,000)
     Acquisitions of property held for sale                                                (154,750)        (70,944)
     Expenditures for preopening costs                                                            -      (6,520,158)
     Increase in marketable securities                                                  (10,629,405)              -
     Other, net                                                                              57,021        (148,846)
                                                                                      --------------  --------------
          Net cash provided by (used in)  investing activities                           (6,246,810)    (74,088,314)
                                                                                      --------------  --------------
Cash flows from financing activities:
     Proceeds from issuance of notes payable and long-term debt                           3,850,001     116,700,000
     Principal payments on notes payable and long-term debt                              (9,461,430)    (44,169,002)
     Capital contributions received                                                               -      22,278,401
     Debt issuance costs                                                                   (544,707)     (5,419,575)
                                                                                      --------------  --------------
          Net cash provided by (used in) financing activities                            (6,156,136)     89,389,824
                                                                                      --------------  --------------
Net increase (decrease) in cash and cash equivalents                                    (10,183,351)     20,858,780
Cash and cash equivalents, beginning of period                                           20,858,780               -
                                                                                      --------------  --------------
Cash and cash equivalents, including restricted cash, end of period                   $  10,675,429   $  20,858,780
                                                                                      ==============  ==============
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS.
</TABLE>



                                      F-6

<PAGE>
<TABLE>
<CAPTION>


                                      JEFFERSON CASINO CORPORATION
                            CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)

Supplemental  schedule  of  non-cash  investing  and  financing  activities:
                                            YEAR     MAY 13, 1996
                                          ENDED     (INCEPTION) TO

                                                                  DECEMBER 31, 1997   DECEMBER 31, 1996
                                                                  ------------------  -----------------
<S>                                                               <C>                 <C>
Property and equipment acquisitions and property held for sale
  financed with long-term debt or capital contributions                     946,004          32,493,913
Construction in progress and preopening costs and other
  included in accounts payable                                                    -           5,074,056
Gaming license acquisition financed with long-term debt                           -          21,617,612
Other current assets included in accounts payable                           105,932                   -
Property and equipment acquisitions included in accounts payable           (832,364)                  -
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS.
</TABLE>
















                                      F-7
<PAGE>

                         JEFFERSON CASINO CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.          SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES:
ORGANIZATION  AND  BASIS  OF  PRESENTATION:
On May 13, 1996 ("Inception"), Jefferson Casino Corporation ("Jefferson Corp."
or  the  "Company"),  a Louisiana corporation and a wholly owned subsidiary of
Casino Magic Corp. ("Casino Magic"), commenced development stage activities by
acquiring  all  of  the  outstanding  capital  stock  of Crescent City Capital
Development  Corporation,  a  Louisiana corporation. Immediately following the
acquisition,  the  name  of  Crescent  City  Capital  Development  Corporation
("Crescent  City") was changed to Casino Magic of Louisiana, Corp. ("Louisiana
Corp.").    Louisiana  Corp.  has  developed  a  dockside riverboat casino and
entertainment  complex  in  Bossier  City,  Louisiana  ("Casino  Magic-Bossier
City"). Casino Magic-Bossier City opened on October 4, 1996, using a temporary
facility,  thereby completing its development stage activities, and opened the
permanent  facility  on  December  31,  1996.  The permanent facility has been
developed  on  a  23  acre  site and includes; a 55,000 square foot land based
pavilion,  which  includes  a  buffet, a fine dining restaurant, fast food and
entertainment areas; a parking garage for approximately 1,550 cars and surface
parking  for another approximately 400 cars; the 30,000 square foot casino has
approximately  1,004  slot  machines  and  approximately  40  table  games and
operates  24  hours a day dockside.  Prior to October 4, 1996, the Company had
no  material  revenues  or  expenses  other  than interest income and expense.
Prior  to  Inception,  Jefferson Corp. had no business activities and Crescent
City  was a wholly owned subsidiary of Capital Gaming International, Inc. with
which  Jefferson  Corp.  had  no  affiliation. Crescent City obtained a gaming
license  from the State of Louisiana and on April 4, 1995, began operations on
a  riverboat  casino, the Crescent City Queen (the "Crescent City Riverboat"),
docked  on  the  Mississippi  River at New Orleans, Louisiana. On June 9, 1995
Crescent  City  ceased  gaming  operations  and  subsequently  converted  an
involuntary  bankruptcy proceeding to a voluntary petition under Chapter 11 of
the  U.S.  Bankruptcy  Code  in  the United States Bankruptcy Court. A plan of
reorganization  was  developed, and was confirmed by the U.S. Bankruptcy Court
on  April  29,  1996  (the  "Plan of Reorganization"). Pursuant to the Plan of
Reorganization,  Crescent  City  was  discharged from substantially all of its
liabilities  prior to the acquisition. The purchase of the outstanding capital
stock  of Crescent City by Jefferson Corp. was effected as part of the Plan of
Reorganization.  Although  the substance of the transaction was an acquisition
of  certain  assets,  the  acquisition  was  structured as a stock purchase to
satisfy  Louisiana gaming license requirements. Crescent City had discontinued
all  gaming  activities  after  only  65 days of operations in the New Orleans
market  and  its  only  significant  assets  consisted  of  the  Crescent City
Riverboat,  a Louisiana gaming license, and the furniture, fixtures and gaming
equipment  located  on  the  Crescent  City  Riverboat.    As  a result of the
foregoing  factors,  management  believes  that  the  financial  position  and
operating results of Crescent City prior to the acquisition are not meaningful
and  are  therefore  not presented because the Company operates in a different
market  including different cruising requirements, with a different vessel and
facility,  under different management and ownership and using a different name
and  marketing  theme.
The  original agreement to acquire Crescent City was entered into by Jefferson
Corp.  and  C-M  of  Louisiana,  Inc.,  the  latter being another wholly owned
subsidiary  of  Casino  Magic.  C-M  of  Louisiana,  Inc. was the fee owner of
approximately  20 acres of land with 900 feet of shoreline on the Red River in
Bossier  City,  Louisiana  (the property that is being used as the gaming site
for  Casino  Magic-Bossier  City).  Another  wholly owned subsidiary of Casino
Magic,  Coastal  Land  of  Florida,  Inc.,  held a 99-year lease on the Casino
Magic-Bossier  City property. Casino Magic had acquired C-M of Louisiana, Inc.
and  Coastal  Land  of  Florida,  Inc.  on October 26, 1995 in anticipation of
obtaining  a  gaming license and establishing gaming operations at the Bossier
City  property. Immediately prior to or as part of the acquisition of Crescent
City,  the  lease  was  canceled  and  C-M  of Louisiana, Inc. was merged into
Jefferson  Corp.  As  a  result,  when  the  acquisition  of Crescent City was
completed,  Jefferson  Corp.  held all ownership interests in the Bossier City
property  and  all  of  the capital stock of Crescent City (which, renamed, is
Louisiana  Corp.).    In  August  1996, Jefferson Corp. contributed all of its
Bossier  City  property, which constituted its only material assets other than
the  capital stock of Louisiana Corp., to Louisiana Corp., its subsidiary, and
Louisiana  Corp.  assumed and paid the only significant liability of Jefferson
Corp.
The consolidated financial statements include the accounts of Jefferson Corp.
and  Louisiana  Corp.,  its  wholly-owned  subsidiary.    All  significant
intercompany  accounts  and  transactions  have  been  eliminated.

                                      F-8

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
1.          ORGANIZATION  AND  BASIS  OF  PRESENTATION  (CONTINUED):
CASINO  REVENUES  AND  COMPLIMENTARIES:
In  accordance  with  common industry practice, casino revenues are the net of
gaming  wins less losses.  Revenues exclude the retail value of complimentary,
food  and  beverage  furnished  gratuitously  to  customers.  The  estimated
departmental  costs of of providing food and beverage services are included in
casino  expense  as  follows:

<TABLE>
<CAPTION>

     YEARS  ENDED  DECEMBER  31,

1997          1996
----------  --------
<S>         <C>
7,500,000  $700,000
==========  ========
</TABLE>


CASH  AND  CASH  EQUIVALENTS:

For  purposes of the consolidated balance sheets and statements of cash flows,
the Company considers all highly liquid investments purchased with an original
maturity  of  three  months  or  less  to  be  cash  equivalents.
MARKETABLE  SECURITIES:
The  Company holds U.S. agency securities as held to maturity and as such, the
investments  are  recorded  at amortized costs, which, based on the short term
nature  of  the  investments  approximates  fair  value.
RESTRICTED  FUNDS:
The  Louisiana  First  Mortgage Notes (See Note 5), restrict the use of certain
cash  amounts.   At December 31, 1997, funds relating to the net proceeds from
the  sale  of the Crescent City Queen Riverboat ($11.7 million) are restricted
to  be  used  for  capital  improvements  at  Casino  Magic-Bossier City.  The
balances  that  remain  in  these restricted accounts at December 31, 1997 are
shown as marketable securities and are restricted.  At December 31, 1996 funds
shown as restricted cash relate to proceeds from the issuance of the Louisiana
First  Mortgage Notes and were restricted for use in the original construction
of  the  land  based  pavilion  and  facilities  at Casino Magic-Bossier City.
PROPERTY  AND  EQUIPMENT:
Property  and  equipment  are  stated  at  cost.    Depreciation,  including
amortization  of  capital leases and leasehold improvements, is computed using
the  straight-line  method.  Estimated useful lives for property and equipment
are  15  - 31  years for barges and buildings, life of the lease for leasehold
improvements  and  5-7  years  for  furniture  and  equipment.
Normal  repairs  and  maintenance  are  charged  to  expense  when  incurred.
Expenditures  which  materially  extend  the useful life of capital assets are
capitalized
AMORTIZATION  OF  INTANGIBLES:
Deferred charges relating to debt issuance costs on long-term debt instruments
are amortized over the life of the related debt using the straight line method
which  approximates  the effective interest rate method.  Included under other
assets  is  "Deferred  gaming  license  cost".   Deferred gaming license costs
represents  the estimated fair value of the Louisiana gaming license, an asset
acquired  in  conjunction  with  the  purchase of Crescent City.  This cost is
being amortized on a straight-line basis over twenty-five years, the estimated
period  to  be  benefited  by  the  license,  commencing  at  the  time gaming
operations  began  at  Casino  Magic-Bossier  City.
PREOPENING  COSTS:
Preopening  costs are initially capitalized and then expensed when the related
business  commences  operations.
                                      F-9
<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
INCOME  TAXES:
Deferred tax assets and liabilities are recognized for future tax consequences
attributable  to  differences between the financial statement carrying amounts
of  existing  assets and liabilities and their respective tax bases.  Deferred
tax  assets  and  liabilities are measured using enacted tax rates expected to
apply  to taxable income in the years in which those temporary differences are
expected  to  be  recovered  or  settled.
The  Company  is a party to a tax sharing agreement between Casino Magic Corp.
and  each  of its domestic subsidiaries (the "Consolidated Group") pursuant to
which  Casino  Magic  Corp.  files a consolidated federal income tax return on
behalf  of  the  Consolidated  Group  and  timely  pays the Consolidated Group
federal  income  tax  liability  and  each  Company pays Casino Magic Corp. an
amount  equal  to  its  respective  share  of the Consolidated Group's federal
income  tax  liability.    The  Company is reimbursed for losses to the extent
those  losses  could  have  been  used  by the Company had it filed a separate
return.
CERTAIN  SIGNIFICANT  RISKS  AND  UNCERTAINTIES:
Gaming  regulation  licensing.  The  Company's  ability  to  conduct  gaming
operations in the State of Louisiana depends on the continued licensability or
qualification  of  Casino  Magic,  Jefferson  Corp.  and Louisiana Corp. under
Louisiana  Gaming  Regulations.  Such  licensing  and  qualifications  will be
reviewed  periodically  by  the  gaming  authorities  in  Louisiana.
Competition. The gaming industry is extremely competitive and the Company will
face  competition  from  developments in both the Bossier City/Shreveport area
and  other  jurisdictions.
Substantial  leverage  and  ability  to  service  debt.  The Company is highly
leveraged,  with  substantial  debt  service  in  addition to construction and
operating  expenses.
Construction.  Risks. include, cost overruns, delay in receipt of governmental
approvals, shortages in materials or skilled labor, labor disputes, unforeseen
environmental  or  engineering problems, work stoppage, fire and other natural
disasters,  construction scheduling problems and weather interferences, any of
which,  if  it  occurred,  could delay construction or result in a substantial
increase  in  costs  to  the  Company.
Pervasiveness  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  disclosures 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.
2.          PROPOSED  MERGER  :
On  February  19,  1998,  Casino  Magic  entered into an Agreement and Plan of
Merger  (the  "Merger Agreement") with Hollywood Park, Inc. ("Hollywood"), and
Acquisition II, Inc. ("HP") a wholly-owned subsidiary of Hollywood.  Under the
Merger  Agreement,  Casino  Magic  has agreed to merge (the "Merger") with HP.
Upon  such Merger, Casino Magic will be the surviving entity and will become a
wholly-owned  subsidiary  of  Hollywood.  Upon the Merger, the shareholders of
Casino  Magic  will  be  entitled  to  receive  $2.27 for each share of Casino
Magic's  stock  held.
The  Merger  is subject to the approval of the Company's shareholders prior to
October  31,  1998,  and to the approval of the Mississippi Gaming Commission,
the  Nevada Gaming Commission, and the Louisiana Gaming Control Board.  If the
Merger  Agreement  is  terminated  for  certain  reasons  Casino Magic will be
required  to  pay  Hollywood  $3,500,000.
The Merger Agreement restricts the ability of the Company to engage in certain
transactions  prior  to  the time of the Merger, except those which are in the
ordinary  course of business consistent with past practice, unless the Company
obtains  the  consent  of  Hollywood,  which  consent  may not be unreasonably
withheld.    The  Merger  Agreement  also  imposes  limits  on  the  capital
expenditures  and  borrowing  which  the  Company  may  effect,  which are not
inconsistent  with  the  Company's  current  plans.
                                     F-10

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
3.          OTHER  ASSETS:
Included  in  other  assets  are  the tangible and intangible assets that were
acquired in the purchase.  Two significant purchased assets were the Louisiana
gaming  license  held  by  Crescent City and the Crescent City Riverboart.  At
December  31,  1996  the balances associated with these costs are comprised of
the  cost  to  acquire Crescent City, additional costs incurred to operate and
maintain  the  Crescent City Riverboat and capitalized interest related to the
gaming  license.  Jefferson Corp. acquired Crescent City for $50.0 million and
was  accounted  for as a purchase.  Of the total purchase price, the Louisiana
gaming  license and the Crescent City Riverboat were allocated $39 million and
$10  million, respectively.  In September 1997 the Crescent City Riverboat was
sold  for  $11.7  million.
4.          NOTES  AND  CONTRACTS  PAYABLE:
Short-term  notes  and  contracts  payable  consist  of  the  following:
<TABLE>
<CAPTION>

     DECEMBER  31,

                             1997       1996
                            -------  ----------
<S>                         <C>      <C>
Construction contracts (a)  $    --  $4,324,771
Other (b)                    76,950     161,939
                            -------  ----------
                            $76,950  $4,486,710
                            =======  ==========
<FN>

(a)          Consists of various payables relating to both fixed and cost plus
contracts.
(b)     In 1997, the balance consisted of one note payable with the balance of
$76,950,  payable  of  monthly  installments  of  $12,825.
</TABLE>


5.          LONG-TERM  DEBT:
Long-term  debt  consists  of  the  following:
<TABLE>
<CAPTION>

        DECEMBER  31,

                                        1997           1996
                                    -------------  -------------
<S>                                 <C>            <C>
Notes payable, bank (a)             $  3,993,039   $  6,275,740
Equipment contracts (b)                2,293,017        409,542
Other (c)                                 33,067         43,515
Louisiana First Mortgage Notes (d)   115,000,000    115,000,000
                                    -------------  -------------
                                     121,319,123    121,728,797
Less current maturities               (3,714,540)    (1,878,605)
                                    -------------  -------------
                                    $117,604,583   $119,850,192
                                    =============  =============
</TABLE>


(a)      Consists of two notes payable to banks.  The detail of these notes is
as  follows:  (i)  Original  note  of  $1,700,000  collateralized  by  gaming
equipment.    Payments  of  principal  and  interest  based  on  a  36  month
amortization  through  May  1998.  The note bears interest at prime plus .25%.
(8.75%  at  December  31,  1997) with a final balloon payment due in May 1998.
(ii)  Original  note  of  $3,850,000 collateralized by certain equipment.  The
note  is  payable  in 10 quarterly payments of $385,000, including interest at
8.25%.    At  December 31, 1997 the Company was not in compliance with certain
debt  covenants  relating  to this note.  The Company has received a waiver of
the  covenants  at  December  31,  1997  and has restructured these covenants.
(b)        Consists of three notes collateralized by equipment.  The detail of
these  notes  is  as  follows: (i) Original note of $946,005 payable in eleven
monthly  payments  of  $78,833,  including interest at prime plus 3%.(11.5% at
December  31,  1997)  with  final  balloon  payment due at term of note.  (ii)
Original note of $1,075,740 collaterized by equipment, payable in twenty-three
monthly  payments  of  $44,823,  including interest at prime plus 1%.(9.50% at
December  31,  1997) with final balloon payment due at term of note.  In March
1998  these  notes  were  refinanced  to  a  term loan payable in twenty-three
monthly installments of $93,465 bearing interest at 10.5% with a final balloon
payment  due in March 2000.  (iii) Original note of $442,359 collateralized by
equipment,  payable  in  thirty  six  monthly  payments  of $13,923, including
principal  and  interest  at  8.3% with the final payament due September 1999.
(c)          Consists of various collateralized notes payable through the year
2000.    The  interest  rates  on these notes vary from 12.95% to 13.25% fixed
rates.

                                     F-11

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
5.          LONG-TERM  DEBT  (CONTINUED):
 (d)     On August 22, 1996, the Company sold $115,000,000 aggregate principal
amount  of 13%, First Mortgage Notes due 2003 with Contingent Interest ("First
Mortgage Notes").  Contingent Interest is payable on the First Mortgage Notes,
on  each  interest  payment date, in an aggregate amount equal to 5% of Casino
Magic-Bossier  City's Adjusted Consolidated Cash Flow (as defined in the First
Mortgage  Notes  Indenture  ("Louisiana Indenture") for the Accrual Period (as
defined  in  the  Louisiana  Indenture, but generally a six month period) last
completed  prior  to  such  interest payment date; provided that no Contingent
Interest  is payable with respect to any period prior to the Commencement Date
(as  defined  in the Louisiana Indenture).  Payment of all or a portion of any
installment  of  Contingent  Interest may be deferred, at the option of Casino
Magic-Bossier  City,  if, and only to the extent that, (i) the payment of such
portion of Contingent Interest will cause Casino Magic-Bossier City's Adjusted
Fixed Charge Coverage Ratio (as defined in the Louisiana Indenture) for Casino
Magic-Bossier  City's  most  recently completed Reference Period prior to such
interest  payment  date  to be less than 1.5 to 1.0 on a pro forma basis after
giving  effect to the assumed payment of such Contingent Interest and (ii) the
principal  amount of the First Mortgage Notes corresponding to such Contingent
Interest  has not then matured and become due and payable (at stated maturity,
upon  acceleration,  upon redemption, upon maturity of a repurchase obligation
or  otherwise).    The  aggregate amount of Contingent Interest payable in any
Semiannual  Period  will be reduced pro rata for reductions in the outstanding
principal  amount  of  notes prior to the close of business on the record date
immediately  preceding  such  payment  of  Contingent  Interest.
The  First  Mortgage  Notes are secured by a first priority security interest,
subject  to  permitted  liens, in substantially all of the existing and future
assets  of Bossier City, including the Bossier Riverboat and substantially all
of the other assets that comprise Casino Magic-Bossier CityThe Jefferson Corp.
Guarantee  will  be secured by a pledge of all of the capital stock of  Casino
Magic  of  Louisiana,  Corp.    a  wholly  owned subsidiary of Jefferson Corp.
Casino  Magic-Bossier  City  has contractually committed to apply net proceeds
from  the asset sale of the Crescent City Riverboat to the construction of  an
entertainment  facility  or  hotel.
The  First  Mortgage  Notes  are  governed  by  the  Louisiana  Indenture. The
Louisiana  Indenture  pursuant  to  which  the  First Mortgage Notes have been
issued  contains  certain  covenants  that  will  limit  the ability of Casino
Magic-Bossier  City  to, among other things, incur additional indebtedness and
issue  preferred  stock,  pay  dividends,  make  investments  or  make  other
restricted  payments, incur liens, enter into mergers or consolidations, enter
into  transactions  with  affiliates  or  sell  assets.
The  proposed  merger  is  a  Change of Control, each Holder of First Mortgage
Notes will have the right to require the Company to repurchase all or any part
(equal  to  $1,000  or an integral multiple thereof) at an offer price in cash
equal  to  101%  of  the  aggregate  principal amount thereof plus accrued and
unpaid  interest,  if  any, thereon to the date of repurchase.  Within 30 days
following any Change of Control, the Company will mail a notice to each Holder
describing  the  transaction  or  transactions  that  constitute the Change of
Control  and  offering  to repurchase the First Mortgage Notes pursuant to the
procedures  required  by  the  Indenture  and  described  in such notice.  The
Company will comply with the requirements of Rule 14e-1 under the Exchange Act
and  any  other  securities laws and regulations thereunder to the extent such
laws  and  regulations are applicable in connection with the repurchase of the
First  Mortgage  Notes.
The  Louisiana  First  Mortgage  Notes  are  redeemable  at  the option of the
Company.    The  redemption  amounts  are  as  follows:
Through  August  15,
2000          106.500%
2001          104.332%
2002          102.166%
                                     F-12

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
5.          LONG-TERM  DEBT  (CONTINUED):
The  Indenture  requires the disclosure of the following information for 1997:
Contingent  Interest  paid          $              --
Contingent  Interest  accrued          $677,000
Accrued  Management  Fees            $1,355,000
Adjusted  Consolidated  Cash  Flow            $13,545,000
All  the  above  terms  are  as  defined  in  the  Indenture.
Maturities  of  the  Company's  long-term  debt,  including  capital  lease
obligations,  as  of  December  31,  1997,  are  as  follows:
<TABLE>
<CAPTION>


YEAR  ENDING DECEMBER 31,
-------------------------
<S>                        <C>
1998                       $  3,714,540
1999                          2,315,796
2000                            288,787
2001                                 --
2002                                 --
Thereafter                  115,000,000
                           ------------
                           $121,319,123
                           ============
</TABLE>


6.          BENEFIT  PLAN:
The  Company  participates  in  Casino  Magic Corp.'s 401(k) Plan (the "401(k)
Plan"),  a  defined  contribution  plan covering all eligible employees of the
Company  who  have  one  year of service and are age twenty-one or older.  The
401(k)  Plan  is  subject  to the provisions of the Employee Retirement Income
Security  Act  of  1974 (ERISA).  Each year, participants may contribute up to
15%  of  pretax  annual  compensation,  as  defined  in  the 401(k) Plan.  The
Company's  matching  and/or additional contributions may be contributed at the
discretion  of  the Company's Board of Directors.  The Company's contributions
to  the 401(k) Plan are allocated to employed participants' accounts as of the
last  day  of  the plan year.  Total employer contributions to the 401(k) Plan
for  the  periods ended December 31, 1997 and 1996 were approximately $20,000,
and  $3,768,  respectively.
7.          ADVERTISING:
The  Company expenses all production and communication costs of advertising as
incurred.  Advertising expenses were approximately $3,400,000 and $700,000 for
the  periods  ended  December  31,  1997  and  1996,  respectively.
8.          RELATED  PARTY  TRANSACTIONS:
The  Company made payments to affiliated companies of approximately $3,360,000
during  1996.    These payments related to development costs paid on behalf of
the  Company  which were incurred prior to the issuance of the Louisiana First
Mortgage  Notes.    At  December 31, 1997 and 1996 the Company had payables to
affiliated  entities  in  the  amounts of $3,262 and $1,130,000, respectively.
The  balances  relate to third party transactions that were paid by affiliated
entities  on  behalf  of  the  Company.
In  August  1996,  the  Company  entered  into  a  management  agreement  (the
"Management  Agreement")  with  Casino  Magic and a wholly owned subsidiary of
Casino  Magic (the "Manager") for a term of 10 years. In consideration for the
license  of  the  "Casino  Magic"  name  and  the  services provided under the
Management  Agreement, the Company has agreed to pay a management fee equal to
10%  of  Adjusted Consolidated Cash Flow, as defined in the Indenture. Payment
of the management fee will be subject to certain restrictions contained in the
Indenture.  The  Company  accrued management fees of $1.4 million during 1997,
none  of  which  has  been  paid.
                                     F-13

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
9.          INCOME  TAXES:
Components  of  deferred  tax  liabilities  (assets)  are  as  follows:
<TABLE>
<CAPTION>

     DECEMBER  31,

                                      1997           1996
                                  -------------  ------------
<S>                               <C>            <C>
Depreciation and amortization     $  2,727,118   $   193,024
Write-off of preopening costs       (1,720,565)   (2,179,383)
Net operating loss carryforward    (10,890,715)   (1,137,024)
Other                               (1,027,937)   (1,151,328)
                                  -------------  ------------
Gross deferred tax assets          (10,912,099)   (4,274,711)
                                  -------------  ------------
Less valuation allowance            10,912,099     4,274,711
                                  =============  ============
    Net deferred tax liabilities  $         --   $        --
                                  =============  ============
</TABLE>


The  provision  for  income  taxes  differs  from  the  amount  of  income tax
determined  by  applying the applicable U.S. statutory federal income tax rate
to  pre-tax  income  from  continuing  operations as a result of the following
differences:

<TABLE>
<CAPTION>

     DECEMBER  31,

                                                   1997          1996
                                               ------------  ------------
<S>                                            <C>           <C>
Statutory U.S. tax rate (35%)                  $(3,724,622)  $(3,515,539)
Increase (decrease) in rates resulting from:
Expenses which were non-deductible
     for tax purposes                              914,000        43,002
Expenses which were deductible
     for tax purposes and not book              (4,255,000)           --
Valuation allowance                              6,637,388     4,274,711
State tax benefit                                       --      (802,174)
Other                                              428,234            --
                                               ------------  ------------
Effective tax rate (0%)                        $        --   $        --
                                               ============  ============
</TABLE>

The  valuation  allowance  against  deferred  tax  assets  was  recorded  in
recognition  of  operating  losses  incurred  by  the Company since Inception.
10.          FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS:
The carrying amounts and fair values of the Company's financial instruments at
December  31,  1997  are  as  follows:

<TABLE>
<CAPTION>


                                                         CARRYING   FAIR
(IN THOUSANDS)                                            AMOUNT    VALUE
-------------------------------------------------------  --------  -------
<S>                                                      <C>       <C>
Cash and cash equivalents                                  10,675   10,675
Marketable securities                                      10,629   10,629
Notes payable and current maturities of long-term debt
     and long-term debt                                   121,396  113,346
</TABLE>

The  following  methods and assumptions were used by the Company in estimating
its  fair  value  disclosure:
Cash  and  cash  equivalents  and  marketable securities.  The carrying amount
reported on the balance sheet approximates its fair value because of the short
nature  of  these  instruments.
Notes  payable  and  current  maturities of long-term debt and long-term debt.
The fair value of the Company's debt either approximates its carrying value or
is    based  upon  the  market  price  of  the  debt  instruments.
Fair  value  estimates are made at a specific point in time, based on relevant
market  information  and  information  about  the financial instrument.  These
estimates  are  subjective  in nature and involve uncertainties and matters of
significant  judgment  and  therefore  cannot  be  determined  with precision.
Changes  in  assumptions  could  significantly  affect  the  estimates.
                                     F-14

<PAGE>
                         JEFFERSON CASINO CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)
11.          CONTINGENCIES
In  July  1997,  the  Company  entered  into  an  agreement  to  sell to Carlo
Corporation  ("Carlo")  the Crescent City Riverboat acquired by the Company in
connection  with its establishment of Casino Magic-Bossier City.  A deposit of
$1,000,000 was paid by Carlo under the agreement and was subject to forfeiture
as  liquidated  damage if the purchase of the vessel was not completed.  Carlo
asserted  that  the  condition of the vessel excused Carlo from completing the
purchase,  and  requested the return of the deposit.  The denied the claim and
retained  the  deposit.   On August 29, 1997 Carlo commenced litigation on the
Circuit  Court  of  Harrison County, Mississippi seeking return of the deposit
and  punitive  damages.    The  Company  has  answered  the  claim.  While the
Company's  management  can  not predict the outcome of this action, management
believes that Company was entitled to retain the deposit as liquidated damages
under  the  agreement  and  intends  to  vigorously  defend  this  action.













                                     F-15