**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **Washington,
        D. C. 20549**
 
 **FORM
        10-Q**
 (Mark
                  One)x
              **QUARTERLY
                  REPORT PURSUANT TO SECTION 13 OR 15(d)****OF
                  THE SECURITIES EXCHANGE ACT OF
                  1934**
 
 **FOR
        THE QUARTERLY PERIOD ENDED JUNE 30, 2007**
 
 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 number: **333-06489**
 
 **Indiana**
              
              **THE
                  MAJESTIC STAR CASINO, LLC**
              
              **43-1664986****Indiana**
              
              **THE
                  MAJESTIC STAR CASINO CAPITAL CORP.**
              
              **35-2100872****Indiana**
              
              **MAJESTIC
                  STAR CASINO CAPITAL CORP. II**
              
              **20-3879309**(State
                  or other jurisdiction of incorporation or organization)
              
              (Exact
                  name of registrant as specified in its charter)
              
              (I.R.S.
                  Employer Identification No.)
 
 **301
        FREMONT STREET**
 **LAS
        VEGAS, NEVADA 89101**
 **(702)
        388 - 2224**
 (Address
        of principal executive offices, including zip code, and telephone number,
        including area code)
 
 Indicate
        by check mark whether the registrant (1) has filed all reports required to
        be
        filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
        the
        preceding 12 months (or for such shorter period that the registrant was required
        to file such reports), and (2) has been subject to filing requirements for
        the
        past 90 days.
 
 Yes
              x
              No
               ̈
 
 Indicate
        by check mark whether the registrant is a large accelerated filer, an
        accelerated filer, or a non-accelerated filer. See definition of “accelerated
        filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
        one):
 
 Large
                  accelerated filer
               ̈
              Accelerated
                  filer
               ̈
              Non-accelerated
                  filer
              x
 
 Indicate
        by check mark whether the registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act).
 
 Yes
               ̈
              No
              x
 
 Indicate
        the number of shares outstanding of each of the issuer’s classes of common
        shares, as of the latest
 practicable
        date.
 Not
        Applicable
  
   **THE
        MAJESTIC STAR CASINO, LLC AND
        SUBSIDIARIES**
 **(A
        Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 
 **Table
        of Contents**
 
 PART
                  I
              FINANCIAL
                  INFORMATION
              Page
                  No.Item
                  1.
              Financial
                  Statements.Condensed
                  Consolidated Balance Sheets as of June 30, 2007
                  (unaudited) and December 31, 2006
              1Condensed
                  Consolidated Statements of Operations for the three
                  and six months ended June 30, 2007 and 2006
                  (unaudited)
              2Condensed
                  Consolidated Statements of Cash Flows for the six
                  months ended June 30, 2007 and 2006 (unaudited)
              3Notes
                  to the Condensed Consolidated Financial Statements
                  (unaudited)
              5Item
                  2.
              Management’s
                  Discussion and Analysis of Financial Condition
                  and Results of Operations.
              24Item
                  3.
              Quantitative
                  and Qualitative Disclosures About Market
                  Risk.
              34Item
                  4T.
              Controls
                  and Procedures.
              34PART
                  II
              OTHER
                  INFORMATIONItem
                  1.
              Legal
                  Proceedings.
              36Item
                  1A.
              Risk
                  Factors.
              37Item
                  6.
              Exhibits.
              38SIGNATURES
              S-1
 
 
 *Table
            of Contents*
  **PART
        I****FINANCIAL
        INFORMATION**
 **Item
        1.**   **Financial
        Statements.**
 **THE
        MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
        Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 CONDENSED
        CONSOLIDATED BALANCE SHEETS
 
 June
                  30,
              
              December
                  31,2007
              
              2006ASSETS
              
              (unaudited)Current
                  assets:Cash
                  and cash equivalents
              
              $
              27,558,919
              
              $
              25,531,924Restricted
                  cash
              
              
              3,628,241
              
              
              3,326,881Accounts
                  receivable, less allowance for doubtful accounts of $1,164,760
                  and$871,448
                  as of June 30, 2007 and December 31, 2006, respectively
              
              
              4,530,048
              
              
              7,582,476Inventories
              
              
              1,075,112
              
              
              888,292Prepaid
                  expenses and deposits
              
              
              7,620,435
              
              
              2,306,311Receivable
                  from affiliate
              
              
              730,067
              
              
              455,270Total
                  current assets
              
              
              45,142,822
              
              
              40,091,154Property,
                  equipment and improvements, net
              
              
              277,479,546
              
              
              275,735,582Intangible
                  assets, net
              
              
              123,665,919
              
              
              125,395,502Goodwill
              
              
              47,431,442
              
              
              47,431,442Other
                  assets:Deferred
                  financing costs, net of accumulated amortizationof
                  $7,434,472 and $5,761,820 as of June 30, 2007 andDecember
                  31, 2006, respectively
              
              
              11,410,448
              
              
              13,083,100Deferred
                  financing costs, pushed down from Majestic Holdco, net ofaccumulated
                  amortization of $777,270 and $523,119, as ofJune
                  30, 2007 and December 31, 2006, respectively
              
              
              2,181,469
              
              
              2,435,620Other
                  assets
              
              
              2,797,100
              
              
              2,187,020Total
                  other assets
              
              
              16,389,017
              
              
              17,705,740Total
                  assets
              
              $
              510,108,746
              
              $
              506,359,420LIABILITIES
                  AND MEMBER'S DEFICITCurrent
                  liabilities:Accounts
                  payable
              
              $
              4,122,565
              
              $
              4,491,600Current
                  portion of long-term debt
              
              
              125,278
              
              
              165,421Accrued
                  liabilities:Payroll
                  and related
              
              
              9,923,571
              
              
              9,116,726Interest
              
              
              10,774,278
              
              
              10,750,630Property
                  and franchise taxes
              
              
              13,028,299
              
              
              8,942,975Other
                  accrued liabilities
              
              
              15,043,678
              
              
              15,554,947Total
                  current liabilities
              
              
              53,017,669
              
              
              49,022,299Long-term
                  debt, net of current maturities
              
              
              553,086,509
              
              
              545,736,924Long-term
                  portion of capitalized leases
              
              
              24,401
              
              
              67,066Long-term
                  debt pushed down from Majestic Holdco, net of discount of
                  $9,183,582and
                  $12,376,308 as of June 30, 3007 and December 31, 2006,
                  respectively
              
              
              54,316,418
              
              
              51,123,692Total
                  liabilities
              
              
              660,444,997
              
              
              645,949,981Member's
                  deficit
              
              
              (150,336,251
              )
              
              (139,590,561
              )Total
                  liabilities and member's deficit
              
              $
              510,108,746
              
              $
              506,359,420
 
 The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.
 
  1
 *Table
            of Contents*
  **THE
        MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
        Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 CONDENSED
        CONSOLIDATED STATEMENTS OF OPERATIONS
 (unaudited)
 
 For
                  The Three Months Ended
              
              For
                  The Six Months EndedJune
                  30,
              
              June
                  30,2007
              
              2006
              
              2007
              
              2006OPERATING
                  REVENUES:Casino
              
              $
              96,137,813
              
              $
              89,942,156
              
              $
              191,268,373
              
              $
              193,827,647Rooms
              
              
              3,049,522
              
              
              2,848,379
              
              
              5,594,467
              
              
              5,612,771Food
                  and beverage
              
              
              6,911,077
              
              
              3,963,758
              
              
              12,786,332
              
              
              8,318,834Other
              
              
              2,018,884
              
              
              1,659,685
              
              
              3,901,360
              
              
              3,407,695Gross
                  revenues
              
              
              108,117,296
              
              
              98,413,978
              
              
              213,550,532
              
              
              211,166,947Less
                  promotional allowances
              
              
              15,212,342
              
              
              12,856,823
              
              
              28,951,959
              
              
              25,691,658Net
                  operating revenues
              
              
              92,904,954
              
              
              85,557,155
              
              
              184,598,573
              
              
              185,475,289OPERATING
                  COSTS AND EXPENSES:Casino
              
              
              23,156,182
              
              
              20,542,370
              
              
              46,814,819
              
              
              43,473,047Rooms
              
              
              1,019,652
              
              
              421,991
              
              
              2,091,836
              
              
              1,606,195Food
                  and beverage
              
              
              2,787,142
              
              
              2,160,821
              
              
              5,498,920
              
              
              4,277,193Other
              
              
              480,076
              
              
              231,415
              
              
              983,197
              
              
              489,480Gaming
                  taxes
              
              
              22,158,447
              
              
              20,031,927
              
              
              44,466,391
              
              
              44,455,255Advertising
                  and promotion
              
              
              5,907,800
              
              
              4,388,475
              
              
              11,356,033
              
              
              8,538,620General
                  and administrative
              
              
              13,676,275
              
              
              14,237,026
              
              
              27,615,185
              
              
              29,265,561Corporate
                  expense
              
              
              1,748,592
              
              
              1,901,961
              
              
              3,471,794
              
              
              3,719,665Economic
                  incentive tax - City of Gary
              
              
              1,712,176
              
              
              1,545,025
              
              
              3,465,765
              
              
              3,352,014Depreciation
                  and amortization
              
              
              8,031,727
              
              
              7,847,099
              
              
              16,201,379
              
              
              15,619,848Loss
                  (gain) on disposal of assets
              
              
              820,288
              
              
              10,686
              
              
              808,563
              
              
              (4,304
              )Total
                  operating costs and expenses
              
              
              81,498,357
              
              
              73,318,796
              
              
              162,773,882
              
              
              154,792,574Operating
                  income
              
              
              11,406,597
              
              
              12,238,359
              
              
              21,824,691
              
              
              30,682,715OTHER
                  INCOME (EXPENSE):Interest
                  income
              
              
              161,869
              
              
              86,310
              
              
              374,046
              
              
              222,377Interest
                  expense
              
              
              (13,718,142
              )
              
              (13,434,812
              )
              
              (27,296,832
              )
              
              (26,748,701
              )Interest
                  expense - debt pushed downfrom
                  Majestic Holdco
              
              
              (1,762,465
              )
              
              (1,575,896
              )
              
              (3,446,879
              )
              
              (3,070,254
              )Other
                  non-operating expense
              
              
              (15,806
              )
              
              (23,955
              )
              
              (50,471
              )
              
              (51,203
              )Total
                  other expense
              
              
              (15,334,544
              )
              
              (14,948,353
              )
              
              (30,420,136
              )
              
              (29,647,781
              )Net
                  (loss) income
              
              $
              (3,927,947
              )
              $
              (2,709,994
              )
              $
              (8,595,445
              )
              $
              1,034,934
 
 The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.
  2
 *Table
            of Contents*
  **THE
        MAJESTIC STAR CASINO, LLC AND
        SUBSIDIARIES**
 **(A
        Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS
 (unaudited)
 
 For
                  The Six Months EndedJune
                  30,2007
              
              2006CASH
                  FLOWS FROM OPERATING ACTIVITIES:Net
                  (loss) income
              
              $
              (8,595,445
              )
              $
              1,034,934Adjustments
                  to reconcile net (loss) income to net cashprovided
                  by operating activities:Depreciation
              
              
              14,471,796
              
              
              13,890,266Amortization
              
              
              1,729,583
              
              
              1,729,582Amortization
                  of deferred financing costs
              
              
              1,672,651
              
              
              1,591,374Amortization
                  of bond discount on 12 1⁄2% senior discount notes anddeferred
                  financing costs pushed down from Majestic Holdco
              
              
              3,446,879
              
              
              3,070,253Loss
                  (gain) on disposal of assets
              
              
              808,563
              
              
              (4,304
              )Changes
                  in operating assets and liabilities, net of effects of
                  acquisition:Accounts
                  receivable, net
              
              
              3,052,428
              
              
              386,532Related
                  party payables
              
              
              (274,797
              )
              
              (421,772
              )Inventories
              
              
              (186,820
              )
              
              56,897Prepaid
                  expenses and deposits
              
              
              (5,314,124
              )
              
              (7,997,182
              )Other
                  assets
              
              
              9,715
              
              
              (71,078
              )Accounts
                  payable
              
              
              (2,655,935
              )
              
              (577,693
              )Accrued
                  payroll and other expenses
              
              
              806,845
              
              
              (308,586
              )Accrued
                  interest
              
              
              23,648
              
              
              3,259,445Other
                  accrued liabilities
              
              
              3,574,056
              
              
              (3,865,509
              )Net
                  cash provided by operating activities
              
              
              12,569,043
              
              
              11,773,159CASH
                  FLOWS FROM INVESTING ACTIVITIES:Increase
                  in restricted cash
              
              
              (301,360
              )
              
              (136,881
              )Adjustment
                  to cost related to Trump Indiana acquisition
              
              
              -
              
              
              (953,020
              )Additions
                  to property and equipment
              
              
              (14,853,729
              )
              
              (5,577,292
              )Increase
                  in Lakefront Capital Improvement Fund
              
              
              (619,795
              )
              
              -Proceeds
                  from disposal of equipment
              
              
              116,305
              
              
              703,083Net
                  cash used in investing activities
              
              
              (15,658,579
              )
              
              (5,964,110
              )
 
 
 The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.
  3
 *Table
            of Contents*
  **THE
        MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
        Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
 (unaudited)
 
 For
                  The Six Months EndedJune
                  30,2007
              
              2006CASH
                  FLOWS FROM FINANCING ACTIVITIES:Issuance
                  costs for the 9 1⁄2% senior secured notes
              
              
              -
              
              
              (132,764
              )Issuance
                  costs for the 9 3⁄4% senior notes
              
              
              -
              
              
              (670,876
              )Issuance
                  costs for 12 1⁄2% senior discount notespushed
                  down from Majestic Holdco
              
              
              -
              
              
              (99,274
              )Proceeds
                  from line of credit
              
              
              27,599,634
              
              
              24,963,368Repayment
                  of line of credit
              
              
              (20,250,049
              )
              
              (34,283,222
              )Repayment
                  of debt
              
              
              (82,809
              )
              
              (1,058,176
              )Distributions
                  to Barden Development, Inc.
              
              
              (2,150,245
              )
              
              (4,469,715
              )Net
                  cash provided by (used in) financing activities
              
              
              5,116,531
              
              
              (15,750,659
              )Net
                  increase (decrease) in cash and cash equivalents
              
              
              2,026,995
              
              
              (9,941,610
              )Cash
                  and cash equivalents, beginning of period
              
              
              25,531,924
              
              
              32,368,249Cash
                  and cash equivalents, end of period
              
              $
              27,558,919
              
              $
              22,426,639For
                  The Six Months EndedJune
                  30,2007
              
              
              2006Supplemental
                  disclosure of cash flow information and non-cash investingand
                  financing activities:INTEREST
                  PAID:
              
              $
              25,600,111
              
              $
              21,998,628NON-CASH
                  INVESTING AND FINANCING ACTIVITIES:Capital
                  assets acquired from incurring accounts payable and accrued
                  liabilities
              
              $
              4,156,022
              
              $
              1,382,849Capital
                  assets acquired from incurring debt
              
              $
              -
              
              $
              110,730Deferred
                  financing and transaction costs related to the Trump
                  acquisitionincluded
                  in accrued liabilities
              
              $
              -
              
              $
              75,504
 
 The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.
 
  4
 *Table
            of Contents*
 **THE
                MAJESTIC STAR CASINO, LLC AND
                SUBSIDIARIES**
 **(A
                Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
                TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(unaudited)**
   **NOTE
        1. ORGANIZATION**
 
 The
        Majestic Star Casino, LLC (the “Company”) is a wholly owned subsidiary of
        Majestic Holdco, LLC (“Majestic Holdco”) which is a wholly owned subsidiary of
        Barden Development, Inc. (“BDI”). The Company was formed on December 8,
        1993, as an Indiana limited liability company to provide gaming and related
        entertainment to the public. The Company commenced gaming operations in the
        City
        of Gary at Buffington Harbor, located in Lake County, Indiana on June 7,
        1996.
 
 The
        Company is a multi-jurisdictional gaming company with operations in three
        states
        - Indiana, Mississippi and Colorado. The Company owns and operates two riverboat
        gaming facilities located in Gary, Indiana (“Majestic Star” and “Majestic Star
        II”, together the “Majestic Properties”).
 
 The
        Company also owns other subsidiaries that operate the following
“Fitzgeralds-brand” casino properties during the periods presented in the
        accompanying consolidated financial statements:
 
 ·
            A
                casino-hotel located in Tunica County, Mississippi (“Fitzgeralds
                Tunica”). 
 ·
            A
                casino located in Black Hawk, Colorado (“Fitzgeralds Black Hawk”). 
 The
        Company also has the following subsidiaries, which were formed for the purpose
        of facilitating financing transactions.
 
 ·
            The
                Majestic Star Casino Capital Corp. (“MSCC”) is a co-obligor with the
                Company for the $300.0 million 9 1⁄2% Senior Secured Notes (the “Senior
                Secured Notes”) due 2010. MSCC has no assets or operations. 
 ·
            Majestic
                Star Casino Capital Corp. II (“MSCC II”) was formed in 2005 for the
                purpose of facilitating the offering of the Company’s $200.0 million 9 3⁄4%
                Senior Notes (the “Senior Notes”) due 2011. MSCC II is a co-obligor with
                the Company for the Senior Notes. MSCC II has no assets or operations. 
 Following
        the completion of the defeasance of the remaining Majestic Investor Holdings,
        LLC (“Investor Holdings”) 11.653% notes (“Investor Notes”) on March 6, 2006, we
        terminated the existence of Majestic Investor Capital Corp (an entity created
        to
        facilitate the issuance of the Investor Notes) effective March 6, 2006. We
        also
        merged Majestic Investor, LLC and Investor Holdings into The Majestic Star
        Casino, LLC on March 21, 2006 and March 22, 2006, respectively, thus making
        Fitzgeralds Tunica and Fitzgeralds Black Hawk direct subsidiaries of The
        Majestic Star Casino, LLC.
 
 Buffington
        Harbor Parking Associates, LLC (“BHPA”), which owned the parking garage at
        Buffington Harbor, was merged into Majestic Star in August 2006. In addition,
        Buffington Harbor Riverboats, LLC (“BHR”), the pavilion and joint docking
        facility for Majestic Star and Majestic Star II, was dissolved on December
        31,
        2006.
 
 Except
        where otherwise noted, the words “we,” “us,” “our,” and similar terms, as well
        as the “Company,” refer to The Majestic Star Casino, LLC and all of its direct
        and indirect subsidiaries.
 
 
  5
 *Table
            of Contents*
 **THE
              MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
              Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
              TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              (CONTINUED)**
 **(unaudited)**
   **NOTE
        2. BASIS OF PRESENTATION**
 
 The
        accompanying consolidated financial statements are unaudited and include
        the
        accounts of The Majestic Star Casino, LLC and its wholly owned direct and
        indirect subsidiaries. All inter-company transactions and balances have been
        eliminated. These financial statements have been prepared in accordance with
        U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial
        information and with the instructions to Form 10-Q and Article 10 of Regulation
        S-X. Accordingly, certain information and footnote disclosures normally included
        in financial statements have been condensed or omitted. The preparation of
        financial statements in conformity with GAAP requires management to make
        estimates and assumptions that affect the reported amounts of assets and
        liabilities and disclosure of contingent assets and liabilities at the date
        of
        the financial statements and the reported amounts of revenues and expenses
        during the reporting period. Significant estimates incorporated into our
        consolidated financial statements include the estimated useful lives of
        depreciable and amortizable assets, the estimated allowance for doubtful
        accounts receivable, estimated cash flow in assessing the recoverability
        of
        long-lived assets and estimated liabilities for our self-insured medical
        and
        workers’ compensation plans, property taxes, slot club point programs, and
        litigation, claims and assessments. Actual results could differ from those
        estimates.
 
 In
        the
        opinion of management, all adjustments (which include normal recurring
        adjustments) considered necessary for a fair statement of the results for
        the
        interim periods have been made. The results for the six months ended June
        30,
        2007 are not necessarily indicative of results to be expected for the full
        fiscal year. The financial statements should be read in conjunction with
        the
        financial statements and notes thereto included in The Majestic Star Casino,
        LLC’s Annual Report on Form 10-K for the year ended December 31,
        2006.
 
 PUSH
        DOWN
        OF DISCOUNT NOTES FROM MAJESTIC HOLDCO - The Company’s consolidated balance
        sheets as of June 30, 2007 and December 31, 2006 include the $63.5 million
        of 121⁄2% Senior Discount Notes due 2011 (the “Discount Notes”), net of discount
        of $9.2 million and $12.4 million, respectively, issued by Majestic Holdco.
        The
        Discount Notes are solely the obligation of Majestic Holdco and Majestic
        Holdco,
        Inc. (the co-issuer with Majestic Holdco) and are unsecured. Neither the
        Company
        nor any of its direct or indirect subsidiaries guarantees the Discount Notes
        nor
        are the equity or assets of the Company or its direct or indirect subsidiaries
        security for the Discount Notes. Further, the indentures governing the Senior
        Notes and the Senior Secured Notes and the loan and security agreement which
        governs our $80.0 million senior secured credit facility (“Senior Secured Credit
        Facility”) preclude distributions by the Company to Majestic Holdco unless
        certain financial tests are met. In addition to the push down of the Discount
        Notes, the Company is also reflecting $2.2 million and $2.4 million of Discount
        Notes’ issuance costs, net of amortization, respectively, on the Company’s
        consolidated balance sheets as of June 30, 2007 and December 31, 2006.
        Amortization of issuance costs were $0.1 million and $0.3 million, respectively,
        for each of the quarters and six-month periods ended June 30, 2007 and 2006.
        Amortization of bond discount was $1.6 million and $1.4 million, respectively,
        for the quarters ended June 30, 2007 and 2006, and $3.2 million and $2.8
        million, respectively, for the six months ended June 30, 2007 and June 30,
        2006,
        as reflected in interest expense on the Company’s consolidated statements of
        operations. A likely scenario for the repayment of these Discount Notes is
        from
        cash flows of the Company or a refinancing of the Company’s indebtedness,
        together with the indebtedness of Majestic Holdco. The Discount Notes have
        been
“pushed-down” to the Company pursuant to the guidelines of Securities and
        Exchange Commission (“SEC”) Staff Accounting Bulletin 73 Topic
        5(J).
 
 
  6
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  PROMOTIONAL
        ALLOWANCES - Cash incentives related to gaming play are recorded as a reduction
        of gross revenues. Such amounts totaled $7.1 million and $8.1 million for
        the
        quarters ended June 30, 2007 and 2006, respectively, and $14.5 million and
        $16.0
        million for the six months ended June 30, 2007 and 2006, respectively. In
        addition, the retail value of accommodations, food and beverage, and other
        services furnished to hotel/casino guests without charge is included in gross
        revenue and then deducted as promotional allowances. The estimated departmental
        cost of providing such promotional allowances is included primarily in casino
        expenses as follows:
 
 For
                  The Three Months Ended
                June
                  30,
              
              For
                  The Six Months Ended
                June
                  30,2007
              
              2006
              
              2007
              
              2006Rooms
              
              $
              830,570
              
              $
              1,053,417
              
              $
              1,939,502
              
              $
              1,641,773Food
                  and Beverage
              
              
              4,640,552
              
              
              2,690,074
              
              
              8,869,057
              
              
              5,259,727Other
              
              
              44,134
              
              
              121,441
              
              
              307,664
              
              
              238,307Total
              
              $
              5,515,256
              
              $
              3,864,932
              
              $
              11,116,223
              
              $
              7,139,807
 
 
 The
        following schedule lists total cash incentives and the retail cost of hotel,
        food, beverage, and other, which comprise total promotional
        allowances.
 
 For
                  The Three Months Ended
                June
                  30,
              
              For
                  The Six Months Ended
                June
                  30,2007
              
              2006
              
              2007
              
              2006Cash
                  based promotional activities
              
              $
              5,230,596
              
              $
              6,416,100
              
              $
              10,676,399
              
              $
              12,304,051Slot
                  club and other
              
              
              1,912,019
              
              
              1,702,793
              
              
              3,858,041
              
              
              3,729,267Retail
                  cost of rooms, food, beverage and other
              
              
              8,069,727
              
              
              4,737,930
              
              
              14,417,519
              
              
              9,658,340Total
              
              $
              15,212,342
              
              $
              12,856,823
              
              $
              28,951,959
              
              $
              25,691,658
 
 
 DOWNLOADABLE
        PROMOTIONAL CREDITS - At Fitzgeralds Tunica, we have implemented promotions
        that
        allow customers to download promotional credits directly to the slot machine.
        While the Company does not recognize the playing of these credits as revenue
        and
        the customer cannot redeem credits for cash, any jackpots won by the customer
        are a direct reduction in slot revenue. During the three- and six-month periods
        ended June 30, 2007, casino revenues were reduced by $2.4 million and $4.6
        million, respectively, as a result of downloadable promotional credits. 
During the three- and six-month periods ended June 30, 2006, casino revenues
        were reduced by $0.2 million as a result of downloadable promotional
        credits.
 
 **NOTE
        3. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS**
 
 The
        Company has adopted or will be required to adopt the following accounting
        policy
        resulting from the following newly issued standards.
 
 ·
            In
                September 2006, the Financial Accounting Standards Board (“FASB”) issued
                FASB No. 157, “Fair Value Measurements” (“FASB 157”), to establish a
                framework for measuring fair value and expanding disclosures related
                to
                fair value measurements. FASB 157 is effective for financial statements
                for fiscal years beginning after November 15, 2007. The Company is
                evaluating what impact, if any, FASB 157 will have on future
                reporting. .
 ·
            In
                February 2007, the FASB issued FASB No. 159, "The Fair Value Option
                for
                Financial Assets and Financial Liabilities" (“FASB 159”). FASB 159 permits
                companies to choose to measure many financial instruments and certain
                other items at fair value. The objective is to improve financial
                reporting
                by providing companies with the opportunity to mitigate volatility
                in
                reported earnings caused by measuring related assets and liabilities
                differently without having to apply complex hedge accounting provisions.
                The fair value option established by FASB 159 permits all companies
                to
                choose to measure eligible items at fair value at specified election
                dates. At each subsequent reporting date, companies shall report
                in
                earnings any unrealized gains and losses on items for which the fair
                value
                option has been elected. FASB 159 is effective as of the beginning
                of a
                company's first fiscal year that begins after November 15, 2007.
                Early
                adoption is permitted as of the beginning of a fiscal year that begins
                on
                or before November 15, 2007, provided the company also elects to
                apply the
                provisions of FASB 157, "Fair Value Measurements" (see above). We
                are
                currently evaluating whether to adopt the fair value option under
                FASB 159
                and evaluating what impact such adoption would have on our condensed
                consolidated financial statements.  7
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  **NOTE
        4. LONG-TERM DEBT**
 
 June
                  30,
                2007
              
              December 31,
                2006Long-term
                  debt outstanding is as follows:9 1⁄2%
                  senior secured notes due 2010
              
              $
              300,000,000
              
              $
              300,000,0009 3⁄4%
                  senior notes due 2011
              
              
              200,000,000
              
              
              200,000,000Senior
                  secured credit facility
              
              
              53,086,509
              
              
              45,736,924Capitalized
                  leases and other debt
              
              
              149,679
              
              
              232,487Total
                  long-term debt
              
              
              553,236,188
              
              
              545,969,411Less
                  current maturities
              
              
              125,278
              
              
              165,421Total
                  long-term debt, net of current maturities
              
              $
              553,110,910
              
              $
              545,803,990
 
 
 **AMENDMENTS
        TO THE SENIOR SECURED CREDIT FACILITY**
 
 The
        Company has entered into various amendments to the loan and security agreement
        governing the Senior Secured Credit Facility, the most current of which is
        described below.
 
 On
        March
        15, 2007, the Company entered into Amendment Number Seven (“Amendment Seven”) to
        the Senior Secured Credit Facility. Amendment Seven modified the Company’s
        minimum EBITDA requirement for the 12-month periods ended March 31, 2007,
        June
        30, 2007 and September 30, 2007 to $65.0 million, respectively, modified
        the
        minimum EBITDA requirement for the 12-month periods ended December 31, 2007,
        March 31, 2008 and June 30, 2008 to $70.0 million, respectively, and modified
        the minimum EBITDA requirement to $72.0 million and $74.0 million, for the
        12-month periods ended September 30, 2008 and December 31, 2008, respectively.
        Amendment Seven also modified the Company’s interest coverage ratio requirement
        for the 12-month periods ended March 31, 2007, June 30, 2007, September 30,
        2007, December 31, 2007, March 31, 2008 and June 30, 2008, to 1.20:1.0,
        respectively, and modified the interest coverage ratio requirement to 1.25:1.0
        for the 12-month periods ended September 30, 2008 and December 31, 2008,
        respectively.
 
 **OTHER
        DEBT**
 
 The
        Company has various capital leases of approximately $0.1 million and other
        debt
        for equipment. These debt obligations are of a short duration.
 
 
 **NOTE
        5. COMMITMENTS AND CONTINGENCIES**
 
 **LEGAL
        PROCEEDINGS**
 
 Various
        legal proceedings are pending against the Company. Management considers all
        such
        pending proceedings, comprised primarily of personal injury and equal employment
        opportunity claims, to be routine litigation incidental to the Company’s
        business. Except as described in our Annual Report on Form 10-K for the year
        ended December 31, 2006, management believes that the resolution of these
        proceedings will not individually, or in the aggregate, have a material effect
        on the Company’s financial condition, results of operations or cash flows. See
        our Annual Report on Form 10-K for the year ended December 31, 2006 for a
        full description of our legal proceedings.
  8
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  In
        February 2006, the Company’s previous stop-loss health insurance provider
        (“Insurance Provider”), through its third party auditor, contacted the Company
        and requested that the Company provide information to facilitate an audit
        of
        employee health insurance stop-loss coverage for the years of 2004 and 2005.
        Although the Company had provided the requested information, as a result
        of this
        audit process, the Insurance Provider has withheld payment on ten individual
        claims that are payable under our stop-loss insurance policy with an aggregate
        outstanding value of approximately $0.7 million. After numerous attempts
        by the
        Company to request and facilitate the completion of the audit, the Company
        filed
        suit on May 3, 2007 in United States District Court for the Northern District
        of
        Illinois against the Insurance Provider alleging: (i) breach of contract,
        (ii)
        unfair practices in settling claims, (iii) bad faith and (iv) breach of
        fiduciary duty. On June 8, 2007 the Insurance Provider filed an Answer,
        Affirmative Defense and Counterclaim Adding Parties (“Counterclaim”) asserting
        three separate substantive claims including: (i) recession, (ii) negligent
        misrepresentation and (iii) breach of contract, alleging that the Company
        failed
        to meet enrollment requirements, keep proper records and pay proper insurance
        premiums for covered employees. On June 28, 2007 the Company responded to
        the
        Counterclaim with an Answer and Affirmative Defenses to Counterclaim denying
        the
        above Counterclaim’s allegations. While the Company continues to believe that it
        is entitled to reimbursement of all claims paid under the obligations of
        the
        insurance policy, at this point in time the Company is unable to assess the
        amount or likelihood of recovery.
 
 
 **TAX
        MATTERS**
 
 Majestic
        Star Income Tax Protest. The
        Company and its ultimate parent, BDI, have been assessed $2.6 million and
        $1.3
        million, respectively, plus interest, by the Indiana Department of Revenue
        (the
“Department”). Additionally, BDI’s non-resident shareholder has been assessed
        $0.2 million, plus penalty and interest. The assessments relate to deductions
        for payments of taxes on adjusted gross gaming revenues the Company’s member
        took in computing adjusted gross income for Indiana state income tax purposes.
        The Department’s position is that the Company had an obligation to withhold and
        remit tax for the non-resident shareholder of its member. The Company, BDI
        and
        BDI’s non-resident shareholder timely filed protests for all tax years at issue
        with the Legal Division of the Department. The Department sustained the
        imposition of negligence penalties on the assessments, but denied the protest
        of
        the tax amount assessed to the extent that amounts assessed are in excess
        of net
        operating losses available to BDI’s non-resident shareholder. The Company and
        BDI have filed petitions with the Indiana Tax Court appealing the Department’s
        ruling on the $2.6 million and $1.3 million assessments. BDI's non-resident
        shareholder filed an appeal with the Indiana Tax Court on May 14, 2007 regarding
        the $0.2 million assessment. The Department has issued discovery requests
        to
        which the Company is in the process of responding. Upon the completion of
        discovery process, the Indiana Tax Court will schedule this matter for trial
        or
        dispositive pre-trial motions. No liability has been accrued by the Company
        relating to this matter.
 
 The
        Company’s indentures governing the Senior Secured Notes and the Senior Notes and
        the loan agreement related to the Senior Secured Credit Facility allow the
        Company to make distributions to BDI for tax purposes. Accordingly, should
        BDI
        ultimately be found liable for additional state income taxes to the State
        of
        Indiana, the Company would make distributions sufficient to pay the additional
        tax. Any payments would be recorded as distributions in Member’s Deficit. The
        Company does not intend to make any distributions until it has fully evaluated
        its options with BDI.
  9
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  BHR
        and Majestic Star Sales and Use Tax Assessments. For
        the
        years 1998 through 2004, the Department assessed BHR and Majestic Star $0.9
        million for unpaid sales and use taxes related to merchandise and other products
        provided to the guests and employees of Majestic Star and BHR at no charge
        and
        the provision of food, provided on a complimentary basis, to the patrons
        and
        employees of BHR’s members Majestic Star and Trump Indiana, Inc. and to Majestic
        Star directly. Based on Hyatt Corp v. Indiana Department of State Revenue
        (“Hyatt”), BHR and Majestic Star believe that they have no sales and use tax
        liability for food for human consumption purchased by it and prepared for
        serving to its customers on a complimentary basis. In Hyatt, the petitioner,
        a
        hotel operator, sought a refund for use tax paid on food purchased for
        complimentary meals that were provided to both guests and employees. Hyatt
        prevailed. Majestic Star and BHR are arguing that food prepared for human
        consumption and provided to customers and employees on a complimentary basis
        are
        not taxable per the Hyatt decision. Should the Department prevail with its
        position that sales taxes are due on the value of complimentary meals Majestic
        Star and BHR provided to employees and customers of Majestic Star, the estimated
        2005 sales tax exposure for the complimentary meals will be an additional
        $0.1
        million. Pursuant to the terms of the stock purchase agreement with Trump
        Entertainment Resorts Holdings, L.P. (“TERH”), TERH is obligated to indemnify
        the Company for 50% of BHR’s pre-closing tax liabilities. With regard to BHR’s
        sales and use tax assessments, BHR protested these proposed assessments in
        August 2006, the Department issued a ruling in June, 2007 denying BHR’s protest,
        and BHR anticipates that an appeal of that ruling will be filed on or
        before August 20, 2007. The indemnification amount would be $0.4 million
        for BHR’s sales and use tax assessments. Estimated exposure for the years ended
        December 31, 2005, December 31, 2006 and the first six months of 2007, which
        would be the Company’s obligation only, would be approximately $0.1 million,
        $0.2 million and $0.2 million, respectively. On May 1, 2007, the Indiana
        Tax
        Court issued a decision in another sales and use tax case involving a riverboat
        casino with facts similar to the facts in Majestic Star’s and BHR’s cases
        outlined above. In that case, the court ruled that the provision of food
        and
        non-food items provided to that casino’s customers on a complimentary basis did
        not constitute retail sales subject to Indiana sales tax, and that the provision
        of food for human consumption, which had been exempt from Indiana sales tax
        when
        purchased, was likewise exempt from use tax when such food was later prepared
        and provided to patrons on a complimentary basis. On May 31, 2007, the
        Department filed a Petition for Review of the Tax Court’s decision in that case
        with the Indiana Supreme Court. On
        August
        7, 2007, the Indiana Supreme Court issued an order denying further review
        of the
        Tax Court’s decision.
 
 
 **GAMING
        AND OTHER REGULATIONS**
 
 The
        Company’s directors, officers, managers and key employees are required to hold
        individual licenses. These requirements vary from jurisdiction to jurisdiction.
        Licenses and permits for gaming operations and for individual licensees are
        subject to revocation or non-renewal for cause. Under certain circumstances,
        holders of our securities are required to secure independent licenses and
        permits.
 
 
 **NOTE
        6. RELATED PARTY TRANSACTIONS**
 
 **TRANSACTIONS
        BY OR WITH AFFILIATES**
 
 *Pushdown
        of Majestic Holdco Discount Notes.* The
        Company’s financial statements for 2007 and 2006 include $63.5 million of
        Discount Notes, net of discount of $9.2 million and $12.4 million as of June
        30,
        2007 and December 31, 2006, respectively, issued by Majestic Holdco. The
        Discount Notes are solely the obligation of Majestic Holdco and are unsecured.
        Neither the Company nor any of its direct or indirect subsidiaries guarantees
        the Discount Notes nor are the equity or assets of the Company or its direct
        or
        indirect subsidiaries security for the Discount Notes. Further, the Indentures
        governing the Senior Notes and the Senior Secured Notes and the loan and
        security agreement which governs our Senior Secured Credit Facility preclude
        distributions by the Company to Majestic Holdco unless certain financial
        tests
        are met. A likely scenario for the repayment of these Discount Notes is from
        cash flows of the Company or a refinancing of the Company’s indebtedness,
        including Majestic Holdco. The Discount Notes have been “pushed-down” to the
        Company pursuant to the guidelines of SEC Staff Accounting Bulletin 73 Topic
        5(J).
 
 *Manager
        Agreement.* Distributions to BDI under the Manager Agreement, dated October 7, 2003,
        are governed and limited by the terms of the indentures governing the Notes
        and
        by the terms of the Senior Secured Credit Facility. The distributions for
        each
        fiscal quarter may not exceed 1% of the Company’s consolidated net operating
        revenue and 5% of the Company’s consolidated cash flow (as defined in the
        indenture governing the Senior Secured Notes and the Senior Secured Credit
        Facility) for the immediately preceding fiscal quarter.
  10
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  During
        the six months ended June 30, 2006, the Company made distributions totaling
        $3.6
        million to BDI pursuant to the Manager Agreement. No distributions were made
        during the six months ended June 30, 2007.
 
 *Tax
        Distributions* .
        Pursuant to the terms of each of the Senior Secured Notes and Senior Notes
        indentures and the Senior Secured Credit Facility, the Company is permitted
        to
        make distributions for its member’s state and federal income tax liabilities. In
        the second quarter of 2007, the Company made a tax distribution of $2.2 million
        to BDI for resolution of an IRS audit of BHR, and 2006 and 2007 Indiana taxes.
        In the second quarter of 2006, the Company made a tax distribution of $0.9
        million to BDI for 2005 Indiana tax liabilities and estimated 2006
        taxes.
 
 *Barden
        Nevada Expense Sharing Agreement* .
        The
        Company has entered into an expense sharing agreement dated October 7, 2003
        with Barden Nevada Gaming, LLC (“Barden Nevada”). The expense sharing agreement
        provides for a fee from Barden Nevada to the Company in the amount of the
        greater of (i) $0.5 million per year, or (ii) the actual amount of certain
        specified expenses incurred by the Company in connection with providing services
        to Barden Nevada. These transactions are included in general and administrative
        expenses in the consolidated statements of operations. For the three and
        six
        months ended June 30, 2007, the Company charged Barden Nevada $0.4 million
        and
        $0.8 million, respectively, pursuant to the expense sharing agreement. For
        the
        three and six months ended June 30, 2006, the Company charged Barden Nevada
        $0.4
        million and $0.7 million pursuant to the expense sharing agreement.
 
 *Barden
        Nevada Revolving Promissory Note.* On
        March 9, 2005, Barden Nevada entered into a revolving promissory note with
        the Company, whereby Barden Nevada may request advances from time to time
        from
        the Company up to $5.0 million. Interest is calculated based on the prime
        rate
        (as published in the Money Section of the Wall Street Journal), plus the
        margin
        spread paid by the Company under prime rate borrowings with Wells Fargo
        Foothill, the agent bank under the Company’s Senior Secured Credit Facility.
        Interest is paid quarterly, in arrears. Any costs that are funded by the
        Company
        and not repaid by Barden Nevada within 30 days will be added to the principal
        amount outstanding. All amounts outstanding under the promissory note are
        due
        and payable on October 7, 2007 along with the accrued and unpaid interest.
        As of June 30, 2007, there was no principal balance outstanding on the
        promissory note.
 
 
 **NOTE
        7. SEGMENT INFORMATION**
 
 The
        Majestic Star Casino, LLC, either directly or indirectly through wholly owned
        subsidiaries, owns and operates four casino properties as follows: two riverboat
        casinos and a hotel located in Gary, Indiana; a casino and hotel located
        in
        Tunica, Mississippi; and a casino located in Black Hawk, Colorado (collectively,
        the “Properties”). The Majestic Properties for 2006 and through the six months
        ended June 30, 2007 include Majestic Star and Majestic Star II. BHPA was
        merged
        into Majestic Star on August 4, 2006, and BHR was dissolved into Majestic
        Star
        on December 31, 2006. Both are shown as if the transactions had been completed
        as of January 1, 2006.
 
 The
        Company identifies its business in three segments based on geographic location.
        The Properties, in each of their segments, market primarily to mid-level
        gaming
        customers. The major products offered in each segment are as follows: casino,
        hotel rooms (at the Majestic Properties and Fitzgeralds Tunica), and food
        and
        beverage.
 
 The
        accounting policies of each business segment are the same as those described
        in
        the summary of significant accounting policies in our Annual Report on Form
        10-K
        for the year ended December 31, 2006. There are minimal inter-segment
        sales.
 
 A
        summary
        of the Properties’ operations by business segment and expenditures for additions
        to long-lived assets for the three months and six months ended June 30, 2007
        and
        2006, respectively, are presented below:
 
  11
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  
 For
                  The Three Months Ended
              
              For
                  The Six Months EndedJune
                  30,
              
              June
                  30,2007
              
              2006
              
              2007
              
              2006(amounts
                  in thousands)Net
                  revenues:Majestic
                  Properties
              
              $
              62,864
              
              $
              56,064
              
              $
              126,088
              
              $
              125,575Fitzgeralds
                  Tunica
              
              
              22,406
              
              
              21,237
              
              
              42,926
              
              
              42,970Fitzgeralds
                  Black Hawk
              
              
              7,635
              
              
              8,256
              
              
              15,585
              
              
              16,930Total
              
              $
              92,905
              
              $
              85,557
              
              $
              184,599
              
              $
              185,475Operating
                  income (loss):Majestic
                  Properties
              
              $
              9,657
              
              $
              10,274
              
              $
              19,367
              
              $
              25,139Fitzgeralds
                  Tunica
              
              
              2,024
              
              
              1,907
              
              
              2,875
              
              
              5,586Fitzgeralds
                  Black Hawk
              
              
              1,505
              
              
              1,988
              
              
              3,115
              
              
              3,730Corporate
                  (1)
              
              
              (1,779
              )
              
              (1,931
              )
              
              (3,532
              )
              
              (3,772
              )Total
              
              $
              11,407
              
              $
              12,238
              
              $
              21,825
              
              $
              30,683Segment
                  depreciation and amortization:Majestic
                  Properties
              
              $
              4,682
              
              $
              5,078
              
              $
              9,533
              
              $
              10,105Fitzgeralds
                  Tunica
              
              
              2,689
              
              
              2,184
              
              
              5,358
              
              
              4,330Fitzgeralds
                  Black Hawk
              
              
              630
              
              
              556
              
              
              1,250
              
              
              1,132Corporate
                  (1)
              
              
              31
              
              
              29
              
              
              60
              
              
              53Total
              
              $
              8,032
              
              $
              7,847
              
              $
              16,201
              
              $
              15,620Expenditure
                  for additions to long-lived assets:Majestic
                  Properties
              
              $
              3,364
              
              $
              761
              
              $
              4,528
              
              $
              2,927Fitzgeralds
                  Tunica
              
              
              1,562
              
              
              835
              
              
              5,611
              
              
              1,337Fitzgeralds
                  Black Hawk
              
              
              3,814
              
              
              701
              
              
              4,666
              
              
              1,190Corporate
              
              
              26
              
              
              118
              
              
              49
              
              
              123Total
              
              $
              8,766
              
              $
              2,415
              
              $
              14,854
              
              $
              5,577
 
   (1)
              Corporate
                  expenses reflect payroll, benefits, travel and other costs associated
                  with
                  our corporate staff and are not allocated to the
                  properties.
 
  12
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  
 **NOTE
        8. SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION**
 
 The
        Majestic Star Casino, LLC is the co-issuer of $300.0 million of Senior Secured
        Notes and $200.0 million of Senior Notes. Under the indentures governing
        the
        Senior Secured Notes and the Senior Notes and the loan and security agreement
        for the Senior Secured Credit Facility, Majestic Star II, Fitzgeralds
        Tunica and Fitzgeralds Black Hawk are guarantor subsidiaries of the $300.0
        million of Senior Secured Notes.
 
 Our
        supplemental guarantor financial information contains financial information
        for
        The Majestic Star Casino, LLC, The Majestic Star Casino Capital Corp (co-issuer
        of the Senior Secured Notes but an entity with no operations), the guarantor
        subsidiaries and the eliminating entries necessary to consolidate such
        entities.
 
 
  13
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING BALANCE SHEET
 As
        of
        June 30, 2007
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedASSETSCurrent
                  assets:Cash
                  and cash equivalents
              
              $
              7,572,952
              
              $
              -
              
              $
              19,985,967
              
              $
              -
              
              
              
              
              $
              27,558,919Restricted
                  cash
              
              
              2,588,241
              
              
              -
              
              
              1,040,000
              
              
              -
              
              
              
              
              
              3,628,241Accounts
                  receivable, net
              
              
              1,828,765
              
              
              -
              
              
              2,701,283
              
              
              -
              
              
              
              
              
              4,530,048Inventories
              
              
              386,515
              
              
              -
              
              
              688,597
              
              
              -
              
              
              
              
              
              1,075,112Prepaid
                  expenses and deposits
              
              
              3,705,681
              
              
              -
              
              
              3,914,754
              
              
              -
              
              
              
              
              
              7,620,435Receivable
                  from affiliate
              
              
              3,557,228
              
              
              -
              
              
              38,586
              
              
              (2,865,747
              )
              (
              a)
              
              
              730,067Investment
                  in subsidiaries
              
              
              137,878,120
              
              
              -
              
              
              -
              
              
              (137,878,120
              )
              (
              b)
              
              
              -Total
                  current assets
              
              
              157,517,502
              
              
              -
              
              
              28,369,187
              
              
              (140,743,867
              )
              
              
              
              
              45,142,822Property,
                  equipment and improvements, net
              
              
              144,803,968
              
              
              -
              
              
              132,675,578
              
              
              -
              
              
              
              
              
              277,479,546Intangible
                  assets, net
              
              
              -
              
              
              -
              
              
              123,665,919
              
              
              -
              
              
              
              
              
              123,665,919Goodwill
              
              
              -
              
              
              -
              
              
              47,431,442
              
              
              -
              
              
              
              
              
              47,431,442Other
                  assets:Deferred
                  financing and transaction cost, net
              
              
              11,410,448
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              11,410,448Deferred
                  financing and transaction cost, net,pushed
                  down from Majestic Holdco (c)
              
              
              2,181,469
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              2,181,469Long-term
                  receivable - related party
              
              
              203,749,438
              
              
              -
              
              
              34,918,450
              
              
              (238,667,888
              )
              (
              a)
              
              
              -Other
                  assets
              
              
              1,159,753
              
              
              -
              
              
              1,637,347
              
              
              -
              
              
              
              
              
              2,797,100Total
                  other assets
              
              
              218,501,108
              
              
              -
              
              
              36,555,797
              
              
              (238,667,888
              )
              
              
              
              
              16,389,017Total
                  assets
              
              $
              520,822,578
              
              $
              -
              
              $
              368,697,923
              
              $
              (379,411,755
              )
              
              
              
              $
              510,108,746LIABILITIES
                  AND MEMBER'S DEFICITCurrent
                  liabilities:Accounts
                  payable
              
              $
              1,307,560
              
              $
              -
              
              $
              2,815,005
              
              $
              -
              
              
              
              
              $
              4,122,565Current
                  portion of long-term debt
              
              
              46,129
              
              
              -
              
              
              79,149
              
              
              -
              
              
              
              
              
              125,278Payable
                  to related party
              
              
              -
              
              
              -
              
              
              2,865,747
              
              
              (2,865,747
              )
              (
              a)
              
              
              -Accrued
                  liabilities:Payroll
                  and related
              
              
              4,227,094
              
              
              -
              
              
              5,696,477
              
              
              -
              
              
              
              
              
              9,923,571Interest
              
              
              10,774,017
              
              
              -
              
              
              261
              
              
              -
              
              
              
              
              
              10,774,278Property
                  and franchise taxes
              
              
              8,027,263
              
              
              -
              
              
              5,001,036
              
              
              -
              
              
              
              
              
              13,028,299Other
                  accrued liabilities
              
              
              4,455,388
              
              
              -
              
              
              10,588,290
              
              
              -
              
              
              
              
              
              15,043,678Total
                  current liabilities
              
              
              28,837,451
              
              
              -
              
              
              27,045,965
              
              
              (2,865,747
              )
              
              
              
              
              53,017,669Due
                  to related parties
              
              
              34,918,451
              
              
              -
              
              
              203,749,437
              
              
              (238,667,888
              )
              (
              a)
              
              
              -Long-term
                  debt, net of current maturities
              
              
              553,086,509
              
              
              300,000,000
              
              
              24,401
              
              
              (300,000,000
              )
              (
              d)
              
              
              553,110,910Long-term
                  debt pushed down from Majestic Holdco (e)
              
              
              54,316,418
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              54,316,418Total
                  liabilities
              
              
              671,158,829
              
              
              300,000,000
              
              
              230,819,803
              
              
              (541,533,635
              )
              
              
              
              
              660,444,997Member's
                  (deficit) equity
              
              
              (150,336,251
              )
              
              (300,000,000
              )
              
              137,878,120
              
              
              162,121,880
              
              (
              b)
                  (d)
              
              
              (150,336,251
              )Total
                  liabilities and member's deficit
              
              $
              520,822,578
              
              $
              -
              
              $
              368,697,923
              
              $
              (379,411,755
              )
              
              
              
              $
              510,108,746
  14
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING BALANCE SHEET (CONTINUED)
 As
        of
        June 30, 2007
 
 
 (a)
              To
                  eliminate intercompany receivables and payables.(b)
              To
                  eliminate intercompany accounts and investment in
                  subsidiaries.(c)
              Reflects
                  the pushdown of deferred financing costs related to the issuance
                  of the
                  Discount Notes of Majestic Holdco, net of amortization, pursuant
                  to SEC
                  Staff Accounting Bulletin 73 Topic 5(J).(d)
              The
                  Majestic Star Casino Capital Corp. is a co-obligor of the Senior
                  Secured
                  Notes issued by the Company. Accordingly, such indebtedness has
                  been
                  presented as an obligation of both the issuer and the co-obligor
                  in the
                  above balance sheet.(e)
              Reflects
                  the pushdown of Majestic Holdco’s Discount Notes pursuant to SEC Staff
                  Accounting Bulletin 73
                  Topic 5(J).
  15
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING BALANCE SHEET
 As
        of
        December 31, 2006
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedASSETSCurrent
                  assets:Cash
                  and cash equivalents
              
              $
              9,101,841
              
              $
              -
              
              $
              16,430,083
              
              $
              -
              
              
              
              
              $
              25,531,924Restricted
                  cash
              
              
              2,286,881
              
              
              -
              
              
              1,040,000
              
              
              -
              
              
              
              
              
              3,326,881Accounts
                  receivable, net
              
              
              2,014,267
              
              
              -
              
              
              5,568,209
              
              
              -
              
              
              
              
              
              7,582,476Inventories
              
              
              196,681
              
              
              -
              
              
              691,611
              
              
              -
              
              
              
              
              
              888,292Prepaid
                  expenses and deposits
              
              
              824,865
              
              
              -
              
              
              1,481,446
              
              
              -
              
              
              
              
              
              2,306,311Receivable
                  from affiliate
              
              
              6,186,636
              
              
              -
              
              
              -
              
              
              (5,731,366
              )
              (
              a)
              
              
              455,270Investment
                  in subsidiaries
              
              
              119,861,069
              
              
              -
              
              
              -
              
              
              (119,861,069
              )
              (
              b)
              
              
              -Total
                  current assets
              
              
              140,472,240
              
              
              -
              
              
              25,211,349
              
              
              (125,592,435
              )
              
              
              
              
              40,091,154Property,
                  equipment and improvements, net
              
              
              146,207,554
              
              
              -
              
              
              129,528,028
              
              
              -
              
              
              
              
              
              275,735,582Intangible
                  assets, net
              
              
              -
              
              
              -
              
              
              125,395,502
              
              
              -
              
              
              
              
              
              125,395,502Goodwill
              
              
              -
              
              
              -
              
              
              47,431,442
              
              
              -
              
              
              
              
              
              47,431,442Other
                  assets:Deferred
                  financing and transaction cost, net
              
              
              13,083,100
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              13,083,100Deferred
                  financing and transaction cost, net,pushed
                  down from Majestic Holdco (c)
              
              
              2,435,620
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              2,435,620Long-term
                  receivable - related party
              
              
              223,649,437
              
              
              -
              
              
              7,757,546
              
              
              (231,406,983
              )
              (
              a)
              
              
              -Other
                  assets
              
              
              503,637
              
              
              -
              
              
              1,683,383
              
              
              -
              
              
              
              
              
              2,187,020Total
                  other assets
              
              
              239,671,794
              
              
              -
              
              
              9,440,929
              
              
              (231,406,983
              )
              
              
              
              
              17,705,740Total
                  assets
              
              $
              526,351,588
              
              $
              -
              
              $
              337,007,250
              
              $
              (356,999,418
              )
              
              
              
              $
              506,359,420LIABILITIES
                  AND MEMBER'S DEFICITCurrent
                  liabilities:Accounts
                  payable
              
              $
              2,166,672
              
              $
              -
              
              $
              2,324,928
              
              $
              -
              
              
              
              
              $
              4,491,600Current
                  portion of long-term debt
              
              
              60,091
              
              
              -
              
              
              105,330
              
              
              -
              
              
              
              
              
              165,421Payable
                  to related party
              
              
              2,095
              
              
              -
              
              
              5,729,271
              
              
              (5,731,366
              )
              (
              a)
              
              
              -Accrued
                  liabilities:Payroll
                  and related
              
              
              3,131,620
              
              
              -
              
              
              5,985,106
              
              
              -
              
              
              
              
              
              9,116,726Interest
              
              
              10,750,630
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              10,750,630Property
                  and franchise taxes
              
              
              5,178,856
              
              
              -
              
              
              3,764,119
              
              
              -
              
              
              
              
              
              8,942,975Other
                  accrued liabilities
              
              
              5,476,552
              
              
              -
              
              
              10,078,395
              
              
              -
              
              
              
              
              
              15,554,947Total
                  current liabilities
              
              
              26,766,516
              
              
              -
              
              
              27,987,149
              
              
              (5,731,366
              )
              
              
              
              
              49,022,299Due
                  to related parties
              
              
              42,298,987
              
              
              -
              
              
              189,107,996
              
              
              (231,406,983
              )
              (
              a)
              
              
              -Long-term
                  debt, net of current maturities
              
              
              545,752,954
              
              
              300,000,000
              
              
              51,036
              
              
              (300,000,000
              )
              (
              d)
              
              
              545,803,990Long-term
                  debt pushed down from Majestic Holdco (e)
              
              
              51,123,692
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              51,123,692Total
                  liabilities
              
              
              665,942,149
              
              
              300,000,000
              
              
              217,146,181
              
              
              (537,138,349
              )
              
              
              
              
              645,949,981Member's
                  (deficit) equity
              
              
              (139,590,561
              )
              
              (300,000,000
              )
              
              119,861,069
              
              
              180,138,931
              
              (
              b)
                  (d)
              
              
              (139,590,561
              )Total
                  liabilities and member's deficit
              
              $
              526,351,588
              
              $
              -
              
              $
              337,007,250
              
              $
              (356,999,418
              )
              
              
              
              $
              506,359,420
 
  16
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  
 NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING BALANCE SHEET (CONTINUED)
 As
        of
        December 31, 2006
 
 
 (a)
              To
                  eliminate intercompany receivables and payables.(b)
              To
                  eliminate intercompany accounts and investment in
                  subsidiaries.(c)
              Reflects
                  the pushdown of deferred financing costs related to the issuance
                  of the
                  Discount Notes of Majestic Holdco, net of amortization, pursuant
                  to SEC
                  Staff Accounting Bulletin 73 Topic 5(J).(d)
              The
                  Majestic Star Casino Capital Corp. is a co-obligor of the Senior
                  Secured
                  Notes issued by the Company. Accordingly, such indebtedness has
                  been
                  presented as an obligation of both the issuer and the co-obligor
                  in the
                  above balance sheet.(e)
              Reflects
                  the pushdown of Majestic Holdco’s Discount Notes pursuant to SEC Staff
                  Accounting Bulletin 73
                  Topic 5(J).
 
  17
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF OPERATIONS
 For
        the
        Three Months Ended June 30, 2007
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedOPERATING
                  REVENUES:Casino
              
              $
              35,563,791
              
              $
              -
              
              $
              60,574,022
              
              $
              -
              
              
              
              
              $
              96,137,813Rooms
              
              
              -
              
              
              -
              
              
              3,049,522
              
              
              -
              
              
              
              
              
              3,049,522Food
                  and beverage
              
              
              2,533,664
              
              
              -
              
              
              4,377,413
              
              
              -
              
              
              
              
              
              6,911,077Other
              
              
              919,318
              
              
              -
              
              
              1,099,566
              
              
              -
              
              
              
              
              
              2,018,884Gross
                  revenues
              
              
              39,016,773
              
              
              -
              
              
              69,100,523
              
              
              -
              
              
              
              
              
              108,117,296Less
                  promotional allowances
              
              
              5,192,409
              
              
              -
              
              
              10,019,933
              
              
              -
              
              
              
              
              
              15,212,342Net
                  operating revenues
              
              
              33,824,364
              
              
              -
              
              
              59,080,590
              
              
              -
              
              
              
              
              
              92,904,954OPERATING
                  COSTS AND EXPENSES:Casino
              
              
              7,638,795
              
              
              -
              
              
              15,517,387
              
              
              -
              
              
              
              
              
              23,156,182Rooms
              
              
              -
              
              
              -
              
              
              1,019,652
              
              
              -
              
              
              
              
              
              1,019,652Food
                  and beverage
              
              
              1,399,320
              
              
              -
              
              
              1,387,822
              
              
              -
              
              
              
              
              
              2,787,142Other
              
              
              249,369
              
              
              -
              
              
              230,707
              
              
              -
              
              
              
              
              
              480,076Gaming
                  taxes
              
              
              9,991,123
              
              
              -
              
              
              12,167,324
              
              
              -
              
              
              
              
              
              22,158,447Advertising
                  and promotion
              
              
              1,406,717
              
              
              -
              
              
              4,501,083
              
              
              -
              
              
              
              
              
              5,907,800General
                  and administrative
              
              
              6,008,544
              
              
              -
              
              
              7,667,731
              
              
              -
              
              
              
              
              
              13,676,275Corporate
                  expense
              
              
              1,748,592
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              1,748,592Economic
                  incentive tax - City of Gary
              
              
              924,216
              
              
              -
              
              
              787,960
              
              
              -
              
              
              
              
              
              1,712,176Depreciation
                  and amortization
              
              
              2,933,260
              
              
              -
              
              
              5,098,467
              
              
              -
              
              
              
              
              
              8,031,727Loss
                  on disposal of assets
              
              
              87,600
              
              
              -
              
              
              732,688
              
              
              -
              
              
              
              
              
              820,288Total
                  operating costs and expenses
              
              
              32,387,536
              
              
              -
              
              
              49,110,821
              
              
              -
              
              
              
              
              
              81,498,357Operating
                  income
              
              
              1,436,828
              
              
              -
              
              
              9,969,769
              
              
              -
              
              
              
              
              
              11,406,597OTHER
                  INCOME (EXPENSE):Interest
                  income
              
              
              100,070
              
              
              -
              
              
              61,799
              
              
              -
              
              
              
              
              
              161,869Interest
                  expense
              
              
              (13,716,494
              )
              
              -
              
              
              (1,648
              )
              
              -
              
              
              
              
              
              (13,718,142
              )Interest
                  expense - debt pushed downfrom
                  Majestic Holdco (a) (b)
              
              
              (1,762,465
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (1,762,465
              )Other
                  non-operating expense
              
              
              (15,806
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (15,806
              )Equity
                  in net income of subsidiaries
              
              
              10,029,920
              
              
              -
              
              
              -
              
              
              (10,029,920
              )
              (
              c)
              
              
              -Total
                  other (expense) income
              
              
              (5,364,775
              )
              
              -
              
              
              60,151
              
              
              (10,029,920
              )
              
              
              
              
              (15,334,544
              )Net
                  (loss) income
              
              $
              (3,927,947
              )
              $
              -
              
              $
              10,029,920
              
              $
              (10,029,920
              )
              
              
              
              $
              (3,927,947
              )
 
 (a)
              Includes
                  amortization of deferred financing costs related to the issuance
                  of
                  Majestic Holdco’s Discount Notes pushed down pursuant to SEC Staff
                  Accounting Bulletin 73 Topic 5(J).(b)
              Includes
                  interest expense on Majestic Holdco’s Discount Notes pushed down pursuant
                  to SEC Staff Accounting Bulletin 73
                  Topic 5(J).(c)
              To
                  eliminate equity in net income of
                  subsidiaries.
 
 
  18
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF OPERATIONS
 For
        the
        Three Months Ended June 30, 2006
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedOPERATING
                  REVENUES:Casino
              
              $
              32,572,164
              
              $
              -
              
              $
              57,369,992
              
              $
              -
              
              
              
              
              $
              89.942.156Rooms
              
              
              -
              
              
              -
              
              
              2,848,379
              
              
              -
              
              
              
              
              
              2,848,379Food
                  and beverage
              
              
              423,023
              
              
              -
              
              
              3,540,735
              
              
              -
              
              
              
              
              
              3,963,758Other
              
              
              818,945
              
              
              -
              
              
              840,740
              
              
              -
              
              
              
              
              
              1,659,685Gross
                  revenues
              
              
              33,814,132
              
              
              -
              
              
              64,599,846
              
              
              -
              
              
              
              
              
              98,413,978Less
                  promotional allowances
              
              
              2,620,584
              
              
              -
              
              
              10,236,239
              
              
              -
              
              
              
              
              
              12,856,823Net
                  operating revenues
              
              
              31,193,548
              
              
              -
              
              
              54,363,607
              
              
              -
              
              
              
              
              
              85,557,155OPERATING
                  COSTS AND EXPENSES:Casino
              
              
              5,997,951
              
              
              -
              
              
              14,544,419
              
              
              -
              
              
              
              
              
              20,542,370Rooms
              
              
              -
              
              
              -
              
              
              421,991
              
              
              -
              
              
              
              
              
              421,991Food
                  and beverage
              
              
              459,821
              
              
              -
              
              
              1,701,000
              
              
              -
              
              
              
              
              
              2,160,821Other
              
              
              7,971
              
              
              -
              
              
              223,444
              
              
              -
              
              
              
              
              
              231,415Gaming
                  taxes
              
              
              9,206,840
              
              
              -
              
              
              10,825,087
              
              
              -
              
              
              
              
              
              20,031,927Advertising
                  and promotion
              
              
              1,239,149
              
              
              -
              
              
              3,149,326
              
              
              -
              
              
              
              
              
              4,388,475General
                  and administrative
              
              
              6,219,331
              
              
              -
              
              
              8,017,695
              
              
              -
              
              
              
              
              
              14,237,026Corporate
                  expense
              
              
              1,901,961
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              1,901,961Economic
                  incentive tax - City of Gary
              
              
              867,014
              
              
              -
              
              
              678,011
              
              
              -
              
              
              
              
              
              1,545,025Depreciation
                  and amortization
              
              
              3,028,120
              
              
              -
              
              
              4,818,979
              
              
              -
              
              
              
              
              
              7,847,099Loss
                  on disposal of assets
              
              
              -
              
              
              -
              
              
              10,686
              
              
              -
              
              
              
              
              
              10,686Total
                  operating costs and expenses
              
              
              28,928,158
              
              
              -
              
              
              44,390,638
              
              
              -
              
              
              
              
              
              73,318,796Operating
                  income
              
              
              2,265,390
              
              
              -
              
              
              9,972,969
              
              
              -
              
              
              
              
              
              12,238,359OTHER
                  INCOME (EXPENSE):Interest
                  income
              
              
              47,966
              
              
              -
              
              
              38,344
              
              
              -
              
              
              
              
              
              86,310Interest
                  expense
              
              
              (13,428,331
              )
              
              -
              
              
              (6,481
              )
              
              -
              
              
              
              
              
              (13,434,812
              )Interest
                  expense - debt pushed downfrom
                  Majestic Holdco (a) (b)
              
              
              (1,575,896
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (1,575,896
              )Other
                  non-operating expense
              
              
              (23,955
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (23,955
              )Equity
                  in net income of subsidiaries
              
              
              10,004,832
              
              
              -
              
              
              -
              
              
              (10,004,832
              )
              (
              c)
              
              
              -Total
                  other (expense) income
              
              
              (4,975,384
              )
              
              -
              
              
              31,863
              
              
              (10,004,832
              )
              
              
              
              
              (14,948,353
              )Net
                  (loss) income
              
              $
              (2,709,994
              )
              $
              -
              
              $
              10,004,832
              
              $
              (10,004,832
              )
              
              
              
              $
              (2,709,994
              )
  (a)
              Includes
                  amortization of deferred financing costs related to the issuance
                  of
                  Majestic Holdco’s Discount Notes pushed down pursuant to SEC Staff
                  Accounting Bulletin 73 Topic 5(J).(b)
              Includes
                  interest expense on Majestic Holdco’s Discount Notes pushed down pursuant
                  to SEC Staff Accounting Bulletin 73
                  Topic 5(J).(c)
              To
                  eliminate equity in net income of
                  subsidiaries.
 
  19
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF OPERATIONS
 For
        the
        Six Months Ended June 30, 2007
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedOPERATING
                  REVENUES:Casino
              
              $
              72,407,450
              
              $
              -
              
              $
              118,860,923
              
              $
              -
              
              
              
              
              $
              191,268,373Rooms
              
              
              -
              
              
              -
              
              
              5,594,467
              
              
              -
              
              
              
              
              
              5,594,467Food
                  and beverage
              
              
              4,589,175
              
              
              -
              
              
              8,197,157
              
              
              -
              
              
              
              
              
              12,786,332Other
              
              
              1,833,370
              
              
              -
              
              
              2,067,990
              
              
              -
              
              
              
              
              
              3,901,360Gross
                  revenues
              
              
              78,829,995
              
              
              -
              
              
              134,720,537
              
              
              -
              
              
              
              
              
              213,550,532Less
                  promotional allowances
              
              
              10,132,937
              
              
              -
              
              
              18,819,022
              
              
              -
              
              
              
              
              
              28,951,959Net
                  operating revenues
              
              
              68,697,058
              
              
              -
              
              
              115,901,515
              
              
              -
              
              
              
              
              
              184,598,573OPERATING
                  COSTS AND EXPENSES:Casino
              
              
              15,026,587
              
              
              -
              
              
              31,788,232
              
              
              -
              
              
              
              
              
              46,814,819Rooms
              
              
              -
              
              
              -
              
              
              2,091,836
              
              
              -
              
              
              
              
              
              2,091,836Food
                  and beverage
              
              
              2,650,970
              
              
              -
              
              
              2,847,950
              
              
              -
              
              
              
              
              
              5,498,920Other
              
              
              509,971
              
              
              -
              
              
              473,226
              
              
              -
              
              
              
              
              
              983,197Gaming
                  taxes
              
              
              20,344,454
              
              
              -
              
              
              24,121,937
              
              
              -
              
              
              
              
              
              44,466,391Advertising
                  and promotion
              
              
              2,725,968
              
              
              -
              
              
              8,630,065
              
              
              -
              
              
              
              
              
              11,356,033General
                  and administrative
              
              
              11,951,783
              
              
              -
              
              
              15,663,402
              
              
              -
              
              
              
              
              
              27,615,185Corporate
                  expense
              
              
              3,471,794
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              3,471,794Economic
                  incentive tax - City of Gary
              
              
              1,889,668
              
              
              -
              
              
              1,576,097
              
              
              -
              
              
              
              
              
              3,465,765Depreciation
                  and amortization
              
              
              5,993,349
              
              
              -
              
              
              10,208,030
              
              
              -
              
              
              
              
              
              16,201,379Loss
                  on disposal of assets
              
              
              87,600
              
              
              -
              
              
              720,963
              
              
              -
              
              
              
              
              
              808,563Total
                  operating costs and expenses
              
              
              64,652,144
              
              
              -
              
              
              98,121,738
              
              
              -
              
              
              
              
              
              162,773,882Operating
                  income
              
              
              4,044,914
              
              
              -
              
              
              17,779,777
              
              
              -
              
              
              
              
              
              21,824,691OTHER
                  INCOME (EXPENSE):Interest
                  income
              
              
              133,280
              
              
              -
              
              
              240,766
              
              
              -
              
              
              
              
              
              374,046Interest
                  expense
              
              
              (27,293,340
              )
              
              -
              
              
              (3,492
              )
              
              -
              
              
              
              
              
              (27,296,832
              )Interest
                  expense - debt pushed downfrom
                  Majestic Holdco (a) (b)
              
              
              (3,446,879
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (3,446,879
              )Other
                  non-operating expense
              
              
              (50,471
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (50,471
              )Equity
                  in net income of subsidiaries
              
              
              18,017,051
              
              
              -
              
              
              -
              
              
              (18,017,051
              )
              (
              c)
              
              
              -Total
                  other (expense) income
              
              
              (12,640,359
              )
              
              -
              
              
              237,274
              
              
              (18,017,051
              )
              
              
              
              
              (30,420,136
              )Net
                  (loss) income
              
              $
              (8,595,445
              )
              $
              -
              
              $
              18,017,051
              
              $
              (18,017,051
              )
              
              
              
              $
              (8,595,445
              )
 
 (a)
              Includes
                  amortization of deferred financing costs related to the issuance
                  of
                  Majestic Holdco’s Discount Notes pushed down pursuant to SEC Staff
                  Accounting Bulletin 73 Topic 5(J).(b)
              Includes
                  interest expense on Majestic Holdco’s Discount Notes pushed down pursuant
                  to SEC Staff Accounting Bulletin 73
                  Topic 5(J).(c)
              To
                  eliminate equity in net income of
                  subsidiaries.
 
  20
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF OPERATIONS
 For
        the
        Six Months Ended June 30, 2006
 
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              
              
              ConsolidatedOPERATING
                  REVENUES:Casino
              
              $
              69,021,309
              
              $
              -
              
              $
              124,806,338
              
              $
              -
              
              
              
              
              $
              193,827,647Rooms
              
              
              -
              
              
              -
              
              
              5,612,771
              
              
              -
              
              
              
              
              
              5,612,771Food
                  and beverage
              
              
              925,177
              
              
              -
              
              
              7,393,657
              
              
              -
              
              
              
              
              
              8,318,834Other
              
              
              1,622,655
              
              
              -
              
              
              1,785,040
              
              
              -
              
              
              
              
              
              3,407,695Gross
                  revenues
              
              
              71,569,141
              
              
              -
              
              
              139,597,806
              
              
              -
              
              
              
              
              
              211,166,947Less
                  promotional allowances
              
              
              5,147,804
              
              
              -
              
              
              20,543,854
              
              
              -
              
              
              
              
              
              25,691,658Net
                  operating revenues
              
              
              66,421,337
              
              
              -
              
              
              119,053,952
              
              
              -
              
              
              
              
              
              185,475,289OPERATING
                  COSTS AND EXPENSES:Casino
              
              
              12,334,810
              
              
              -
              
              
              31,138,237
              
              
              -
              
              
              
              
              
              43,473,047Rooms
              
              
              -
              
              
              -
              
              
              1,606,195
              
              
              -
              
              
              
              
              
              1,606,195Food
                  and beverage
              
              
              968,983
              
              
              -
              
              
              3,308,210
              
              
              -
              
              
              
              
              
              4,277,193Other
              
              
              15,400
              
              
              -
              
              
              474,080
              
              
              -
              
              
              
              
              
              489,480Gaming
                  taxes
              
              
              19,608,705
              
              
              -
              
              
              24,846,550
              
              
              -
              
              
              
              
              
              44,455,255Advertising
                  and promotion
              
              
              2,624,287
              
              
              -
              
              
              5,914,333
              
              
              -
              
              
              
              
              
              8,538,620General
                  and administrative
              
              
              13,607,833
              
              
              -
              
              
              15,657,728
              
              
              -
              
              
              
              
              
              29,265,561Corporate
                  expense
              
              
              3,719,665
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              3,719,665Economic
                  incentive tax - City of Gary
              
              
              1,787,746
              
              
              -
              
              
              1,564,268
              
              
              -
              
              
              
              
              
              3,352,014Depreciation
                  and amortization
              
              
              5,986,730
              
              
              -
              
              
              9,633,118
              
              
              -
              
              
              
              
              
              15,619,848Gain
                  on disposal of assets
              
              
              (2,727
              )
              
              -
              
              
              (1,577
              )
              
              -
              
              
              
              
              
              (4,304
              )Total
                  operating costs and expenses
              
              
              60,651,432
              
              
              -
              
              
              94,141,142
              
              
              -
              
              
              
              
              
              154,792,574Operating
                  income
              
              
              5,769,905
              
              
              -
              
              
              24,912,810
              
              
              -
              
              
              
              
              
              30,682,715OTHER
                  INCOME (EXPENSE):Interest
                  income
              
              
              122,586
              
              
              -
              
              
              99,791
              
              
              -
              
              
              
              
              
              222,377Interest
                  expense
              
              
              (26,721,265
              )
              
              -
              
              
              (27,436
              )
              
              -
              
              
              
              
              
              (26,748,701
              )Interest
                  expense - debt pushed downfrom
                  Majestic Holdco (a) (b)
              
              
              (3,070,254
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (3,070,254
              )Other
                  non-operating expense
              
              
              (51,203
              )
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              (51,203
              )Equity
                  in net income of subsidiaries
              
              
              24,985,165
              
              
              -
              
              
              -
              
              
              (24,985,165
              )
              (
              c)
              
              
              -Total
                  other (expense) income
              
              
              (4,734,971
              )
              
              -
              
              
              72,355
              
              
              (24,985,165
              )
              
              
              
              
              (29,647,781
              )Net
                  income
              
              $
              1,034,934
              
              $
              -
              
              $
              24,985,165
              
              $
              (24,985,165
              )
              
              
              
              $
              1,034,934
 
 (a)
              Includes
                  amortization of deferred financing costs related to the issuance
                  of
                  Majestic Holdco’s Discount Notes pushed down pursuant to SEC Staff
                  Accounting Bulletin 73 Topic 5(J).(b)
              Includes
                  interest expense on Majestic Holdco’s Discount Notes pushed down pursuant
                  to SEC Staff Accounting Bulletin 73
                  Topic 5(J).(c)
              To
                  eliminate equity in net income of
                  subsidiaries.
  21
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  
 NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF CASH FLOWS
 For
        the
        Six Months Ended June 30, 2007
  
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              ConsolidatedNET
                  CASH (USED IN) PROVIDED BYOPERATING
                  ACTIVITIES:
              
              $
              (19,488,925
              )
              $
              -
              
              $
              32,057,968
              
              $
              -
              
              $
              12,569,043CASH
                  FLOWS FROM INVESTING ACTIVITIES:
                Increase
                  in restricted cash
              
              
              (301,360
              )
              
              -
              
              
              -
              
              
              -
              
              
              (301,360
              )Additions
                  to property and equipment
              
              
              (4,409,056
              )
              
              -
              
              
              (10,444,673
              )
              
              -
              
              
              (14,853,729
              )Increase
                  in Lakefront Capital Improvement Fund
              
              
              (619,795
              )
              
              -
              
              
              -
              
              
              -
              
              
              (619,795
              )Proceeds
                  from disposal of equipment
              
              
              20,900
              
              
              -
              
              
              95,405
              
              
              -
              
              
              116,305Net
                  cash used in investing activities
              
              
              (5,309,311
              )
              
              -
              
              
              (10,349,268
              )
              
              -
              
              
              (15,658,579
              )CASH
                  FLOWS FROM FINANCING ACTIVITIES:Proceeds
                  from line of credit
              
              
              27,599,634
              
              
              -
              
              
              -
              
              
              -
              
              
              27,599,634Repayment
                  of line of credit
              
              
              (20,250,049
              )
              
              -
              
              
              -
              
              
              -
              
              
              (20,250,049
              )Advances
                  from (to) affiliates
              
              
              18,100,000
              
              
              -
              
              
              (18,100,000
              )
              
              -
              
              
              -Repayment
                  of debt
              
              
              (29,993
              )
              
              -
              
              
              (52,816
              )
              
              -
              
              
              (82,809
              )Distribution
                  to Barden Development, Inc.
              
              
              (2,150,245
              )
              
              -
              
              
              -
              
              
              -
              
              
              (2,150,245
              )Net
                  cash provided by (used in) financing activities
              
              
              23,269,347
              
              
              -
              
              
              (18,152,816
              )
              
              -
              
              
              5,116,531Net
                  (decrease) increase in cash and cash equivalents
              
              
              (1,528,889
              )
              
              -
              
              
              3,555,884
              
              
              -
              
              
              2,026,995Cash
                  and cash equivalents, beginning of period
              
              
              9,101,841
              
              
              -
              
              
              16,430,083
              
              
              -
              
              
              25,531,924Cash
                  and cash equivalents, end of period
              
              $
              7,572,952
              
              $
              -
              
              $
              19,985,967
              
              $
              -
              
              $
              27,558,919
 
 
  22
 *Table
            of Contents*
 **THE
            MAJESTIC STAR CASINO, LLC AND SUBSIDIARIES**
 **(A
            Wholly Owned Subsidiary of Majestic Holdco, LLC)**
 **NOTES
            TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            (CONTINUED)**
 **(unaudited)**
  NOTE
        8.
        SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION (CONTINUED)
 
 CONDENSED
        CONSOLIDATING STATEMENT OF CASH FLOWS
 For
        the
        Six Months Ended June 30, 2006
 
 
 The
                  Majestic
              
              The
                  MajesticStar
                  Casino,
              
              Star
                  Casino
              
              Guarantor
              
              Eliminating
              
              TotalLLC
              
              Capital
                  Corp.
              
              Subsidiaries
              
              Entries
              
              ConsolidatedNET
                  CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES :
              
              $
              (3,973,378
              )
              $
              -
              
              $
              $
                  15,746,537
              
              $
              -
              
              $
              $
                  11,773,159CASH
                  FLOWS FROM INVESTING ACTIVITIES:Increase
                  in restricted cash
              
              
              (136,881
              )
              
              -
              
              
              -
              
              
              -
              
              
              (136,881
              )Adjustment
                  to costs related to the Trump Indiana acquisition
              
              
              -
              
              
              -
              
              
              (953,020
              )
              
              -
              
              
              (953,020
              )Additions
                  to property and equipment
              
              
              (2,912,493
              )
              
              -
              
              
              (2,664,799
              )
              
              -
              
              
              (5,577,292
              )Proceeds
                  from disposal of equipment
              
              
              134,068
              
              
              -
              
              
              569,015
              
              
              -
              
              
              703,083Net
                  cash used in investing activities
              
              
              (2,915,306
              )
              
              -
              
              
              (3,048,804
              )
              
              -
              
              
              (5,964,110
              )CASH
                  FLOWS FROM FINANCING ACTIVITIES:Payment
                  of debt issuance costs (a)
              
              
              (902,914
              )
              
              -
              
              
              -
              
              
              -
              
              
              (902,914
              )Repayment
                  of line of credit
              
              
              (34,283,222
              )
              
              -
              
              
              -
              
              
              -
              
              
              (34,283,222
              )Proceeds
                  from line of credit
              
              
              24,963,368
              
              
              -
              
              
              -
              
              
              -
              
              
              24,963,368Advances
                  from (to) affiliates
              
              
              19,350,000
              
              
              -
              
              
              (19,350,000
              )
              
              -
              
              
              -Repayment
                  of debt
              
              
              -
              
              
              -
              
              
              (1,058,176
              )
              
              -
              
              
              (1,058,176
              )Distributions
                  to Barden Development, Inc.
              
              
              (4,469,715
              )
              
              -
              
              
              -
              
              
              -
              
              
              (4,469,715
              )Net
                  cash provided by (used in) financing activities
              
              
              4,657,517
              
              
              -
              
              
              (20,408,176
              )
              
              -
              
              
              (15,750,659
              )Net
                  decrease in cash and cash equivalents
              
              
              (2,231,167
              )
              
              -
              
              
              (7,710,443
              )
              
              -
              
              
              (9,941,610
              )Cash
                  and cash equivalents, beginning of period
              
              
              8,084,908
              
              
              -
              
              
              24,283,341
              
              
              -
              
              
              32,368,249Cash
                  and cash equivalents, end of period
              
              $
              5,853,741
              
              $
              -
              
              $
              $
                  16,572,898
              
              $
              -
              
              $
              $
                  22,426,639
 
 
 
 (a)
              Includes
                  the pushdown of $0.1 million of issuance costs of Majestic Holdco’s
                  Discount Notes pursuant to SEC Staff Accounting Bulletin 73
                  Topic 5(J).
 
  23
 *Table
            of Contents*
   
 
 **ITEM
        2.****Management’s
        Discussion and Analysis of Financial Condition and Results of
        Operations.**
 
 
 **STATEMENT
        ON FORWARD-LOOKING INFORMATION**
 
 Throughout
        this report we make forward-looking statements. Forward-looking statements
        include the words “may,” “will,” “would,” “could,” “likely,” “estimate,”
“intend,” “plan,” “continue,” “believe,” “expect” or “anticipate” and other
        similar words and include all discussions about our development plans. We
        do not
        guarantee that the transactions and events described in this report will
        happen
        as described or that any positive trends noted in this report will continue.
        The
        forward-looking statements contained in this report are generally located
        in the
        material set forth under the heading “Management’s Discussion and Analysis of
        Financial Condition and Results of Operations,” but may be found in other
        locations as well. These forward-looking statements generally relate to our
        plans, objectives and expectations for future operations and are based upon
        management’s reasonable estimates of future results or trends. Although we
        believe that our plans and objectives reflected in or suggested by such
        forward-looking statements are reasonable, we may not achieve such plans
        or
        objectives. You should read this report completely and with the understanding
        that actual future results may be materially different from what we expect.
        We
        will not update forward-looking statements even though our situation may
        change
        in the future.
 
 For
        a
        more complete description of the risk factors that may affect our business,
        see
        the risk factors set forth in Item 1A., Risk Factors, in the Company’s Annual
        Report on Form 10-K for the year ended December 31, 2006, and as updated in
        Part II of this report, and elsewhere in this report.
 
 All
        future written and verbal forward-looking statements attributable to us or
        any
        person acting on our behalf are expressly qualified in their entirety by
        the
        cautionary statements contained or referred to in this report. In light of
        these
        risks, uncertainties and assumptions, the forward-looking events discussed
        in
        this report might not occur.
 
 
 **OVERVIEW**
 
 ***The
        Company***
 
 The
        Majestic Star Casino, LLC and its subsidiaries operate two riverboat gaming
        facilities, Majestic Star and Majestic Star II, located in Gary, Indiana
        and two
        Fitzgeralds brand casino-hotels located in Tunica County, Mississippi,
        Fitzgeralds Tunica, and Black Hawk, Colorado (casino only), Fitzgeralds Black
        Hawk. The Company has entered into an expense-sharing arrangement with Barden
        Nevada Gaming, LLC for support services. See Note 6 to the Consolidated
        Financial Statements.
 
 
 **COMPANY
        DEVELOPMENTS**
 
 ***The
        Majestic Properties***
 
 During
        the second quarter of 2007 the Majestic Properties continued to be aggressive
        with marketing and promotions in order to drive casino volumes and enhance
        customer loyalty. As a result, we saw our casino revenues grow by 13.3% over
        the
        second quarter of 2006 and our northwest Indiana market share increase from
        18.6% in the second quarter of 2006 to 20.1% in the second quarter of this
        year.
        However, our aggressive marketing and promotions have impacted margins, with
        our
        operating margin (defined as operating income divided by net revenues) declining
        to 15.4% in the 2007 period from 18.3% in the 2006 period.
 
 As
        previously reported, we took control of the food and beverage operations
        within
        the Buffington Harbor pavilion in the first quarter of 2007. We continue
        to
        improve these restaurant outlets. During the second quarter the steakhouse
        was
        remodeled and re-branded as Don B’s. We are in the process of improving the look
        and experience in the buffet. Wings and Things, a fast food outlet that was
        opened earlier in the year, has been a success with our guests.
  24
 *Table
            of Contents*
  During
        the second quarter of 2007 we had the grand opening of our new baccarat room.
        We
        are pleased with the initial table game volumes being generated by the room.
        Since baccarat is primarily catering to our Asian customers, we have enhanced
        our Asian player development programs. We are also upgrading and improving
        our
        high limit table game room and we recently renovated and improved the high
        limit
        slot lounge.
 
 We
        have
        made various changes to our marketing and promotional activities, including
        introducing a new advertising agency and increased player development events.
        We
        have also partnered with the Heartland Poker Tour on tournaments being held
        in
        our poker room. Partnering with the Heartland Poker Tour has enhanced poker
        revenues and brought exposure to our facilities. We have also expanded our
        entertainment options to drive casino volumes.
 
 In
        the
        third quarter of 2007 we will be revising our marketing campaigns and moving
        toward utilization of downloadable credits at our slot machines. 
Downloadable promotional credits will reduce the walk factor associated with
        customers cashing in direct mail coupons and leaving the property.
        Unlike Fitzgeralds Tunica, redemption of promotional credits is
        treated as casino revenue for tax purposes and as a result the Majestic
        Properties will be remitting taxes on the value of  promotional credits
        redeemed by our customers to the state of Indiana.
 
 We
        are
        also continuing to develop designs and plans for a single level gaming vessel
        to
        be located directly adjacent to our existing riverboats in Buffington Harbor.
        Plans include a new pavilion containing various food and beverage venues,
        a
        single level gaming vessel containing 2,500-3,500 slot machines, 50-80 table
        games, a poker room, and various other venues. Our ability to finance such
        a
        project is limited given our current capital structure; however, we are
        exploring all of our options.
 
 
 ***Fitzgeralds
        Tunica***
 
 The
        Tunica market continues to be extremely competitive. In addition, we believe
        that the re-opening of casinos along the Mississippi gulf coast is causing
        customers, who were displaced due to the hurricanes in 2005, and found Tunica
        as
        a gambling option, are now returning to the new gulf coast casino facilities.
        The property management team continues its focus on improving the quality
        of
        customer. Management’s efforts are seen in the 26.2% increase in table games
        drop over the second quarter of 2006. However, volatility in our table games
        win
        percentage exists. While the win percentage in the second quarter was 1.4%
        greater than in the same quarter last year, for the six months ended June
        30,
        2007, our table games win percentage is 3.3% below last year’s level. The lower
        year-to-date win percentage in table games has impacted our table games revenues
        by $1.1 million (measured by taking this year’s table games drop times last
        year’s table games win percentage and subtracting from this year’s table games
        revenues).
 
 During
        the second quarter of 2007, we completed the upgrading and remodeling of
        the
        hotel at a cost of approximately $7.3 million. The newly remodeled rooms
        work
        hand in hand with our strategy to improve the quality of the casino’s customers.
        The remodeled rooms give our customer a feeling of luxury and elegance. As
        a
        result of the hotel remodel project, we lost availability to approximately
        12,000 room nights during the first half of the year. The decline in room
        supply
        impacted our revenues by approximately $0.3 million.
 
 
 ***Fitzgeralds
        Black Hawk***
 
 Results
        at our Fitzgeralds Black Hawk property were lower for the three- and six-month
        periods ended June 30, 2007 than for the three and six-month periods ended
        June
        30, 2006. Impacting our financial results was repaving and rock mitigation
        work
        on Highway 6 (the main highway) into Black Hawk, which closed the road until
        3:30 pm daily during weekdays from April 30 to May 25. Also, our revenues
        continue to be impacted by improved facilities and marketing efforts at our
        competitors.
  25
 *Table
            of Contents*
  The
        property expansion project is continuing as planned. We anticipate completion
        of
        the expanded casino in June/July of 2008. So far the disruption to our existing
        casino operations has been minimal; however, we anticipate that our customers
        will begin to experience greater inconvenience as the project moves forward.
        Recently we changed vehicle egress from the property and the location in
        which
        guests retrieve their cars. We are taking necessary steps to reduce customer
        inconvenience and have implemented promotions to reward customers for their
        patience during the expansion project.
 
 During
        the second quarter of 2007 we launched new player development initiatives
        and
        enhanced our player development team. In the near future we will be revising
        our
        customer reactivation, recruitment and retention strategies.
 
 
 **CONSOLIDATED
        FINANCIAL RESULTS** ******
 
 The
        discussion of our consolidated financial results for the three and six months
        ended June 30, 2007 is inclusive of Majestic Star, Majestic Star II,
        Fitzgeralds Tunica, Fitzgeralds Black Hawk, the Company’s corporate overhead and
        interest expense and the pushdown of the Discount Notes, related financing
        costs
        and amortization of financing costs of Majestic Holdco.
 
 ***Discount
        Notes***
 
 Majestic
        Holdco, the Company’s parent, issued, in conjunction with its co-issuer,
        Majestic Holdco, Inc., $63.5 million, net of original issue discount, of
        12 1⁄2% Senior Discount Notes due 2011. The Company’s consolidated balance
        sheets as of June 30, 2007 and December 31, 2006 include the pushdown of
        Discount Notes of $54.3 million and $51.1 million, respectively, net of original
        issue discount. Also pushed down are financing costs of $2.2 million and
        $2.4
        million, both net of amortization as of June 30, 2007 and December 31, 2006.
        The
        Company is also reflecting $1.8 million and $1.6 million for the three-month
        periods ended June 30, 2007 and 2006, respectively, and $3.4 million and
        $3.1
        million for the six-month periods ended June 30, 2007 and 2006, respectively,
        of amortization of original issue discount and financing costs within its
        consolidated statements of operations and cash flows. A likely scenario for
        the
        repayment of these Discount Notes is from cash flows of the Company or a
        refinancing of the Company’s indebtedness, together with the indebtedness of
        Majestic Holdco. The Discount Notes have been “pushed-down” to the Company
        pursuant to the guidelines of SEC Staff Accounting Bulletin 73 Topic 5(J).
        The
        Discount Notes are solely the obligation of Majestic Holdco and its co-issuer,
        Majestic Holdco, Inc. and are unsecured. Neither the Company nor any of its
        direct or indirect subsidiaries guarantees the Discount Notes nor are the
        equity
        or assets of the Company or its subsidiaries security for the Discount Notes.
        Further, the Indentures governing the Senior Notes and the Senior Secured
        Notes
        and the loan and security agreement which governs our Senior Secured Credit
        Facility preclude distributions by the Company to Majestic Holdco unless
        certain
        financial tests are met.
 
 
 ***Consolidated
        Operating Results: Second Quarter 2007 Compared to the Second Quarter
        2006***
 
 Consolidated
        gross operating revenues increased $9.7 million, or 9.9%, to $108.1 million
        in
        the three-month period ended June 30, 2007 from $98.4 million in the three-month
        period ended June 30, 2006. The increase is due to higher gross revenues
        at the
        Majestic Properties of $10.8 million, partially offset by lower gross revenues
        at Fitzgeralds Tunica and Fitzgeralds Black Hawk of $0.6 million and $0.5
        million, respectively.
 
 Consolidated
        casino revenues, which comprise 88.9% of consolidated gross revenues, increased
        $6.2 million, or 6.9%, to $96.1 million, in the three-month period ended
        June
        30, 2007, from $89.9 million in the similar period last year. The increase
        is
        due to higher casino revenues at the Majestic Properties of $7.7 million,
        partially offset by lower casino revenues at Fitzgeralds Tunica and Fitzgeralds
        Black Hawk of $1.0 million and $0.5 million, respectively. The decline at
        the
        latter two properties is due to the competitive markets in which our casinos
        operate as well as the implementation of downloadable promotional credits
        at our
        Fitzgeralds Tunica property (see discussion below).
 
 Consolidated
        food and beverage revenues increased $2.9 million to $6.9 million in the
        current
        quarter, primarily due to a $2.6 million increase at the Majestic Properties.
        The increase at the Majestic Properties results from taking over the food
        and
        beverage operations in the Buffington Harbor pavilion.
  26
 *Table
            of Contents*
  During
        the second quarter of 2007, promotional allowances, which are deducted from
        gross operating revenues to arrive at net revenues, increased $2.4 million
        to
        $15.2 million from $12.9 million in the same quarter last year. The increase
        is
        due to enhanced promotional efforts at the Majestic Properties, which increased
        $4.0 million. As mentioned above, the Majestic Properties were more aggressive
        with promotional allowances in order to increase customer visits and attract
        new
        customers to the properties. Fitzgeralds Tunica had a decrease in promotional
        allowances of $1.7 million, resulting from downloadable promotional credits.
 
 In
        the
        three-month period ended June 30, 2007, as compared to the same three-month
        period last year, operating costs and expenses increased by $8.2 million.
        Operating expenses were up $7.4 million at the Majestic Properties, primarily
        as
        a result of greater casino, room, food and beverage and gaming tax expenses,
        plus an $0.8 million loss on sale and write down of obsolete slot machines,
        and
        $1.1 million at Fitzgeralds Tunica, primarily as a result of greater advertising
        and promotional expenses. Operating costs and expenses declined $0.1 million
        each at Fitzgeralds Black Hawk and corporate.
  As
        a
        result of a $7.3 million increase in net revenues, which follows from our
        $9.7
        million increase in gross revenues and the $2.4 million increase in promotional
        allowances, and our $8.2 million increase in operating expenses, operating
        income declined by $0.8 million. Additionally, interest expense increased
        $0.5
        million, resulting in an increase of consolidated net loss by $1.2 million.
 
 ***Consolidated
        Operating Results: Six Months Ended June 30, 2007 Compared to the Six Months
        Ended June 30, 2006***
 
 Consolidated
        gross operating revenues increased $2.4 million, or 1.1%, to $213.6 million
        in
        the six-month period ended June 30, 2007 from $211.2 million in the six-month
        period ended June 30, 2006. The increase is due to higher gross revenues
        at the
        Majestic Properties of $7.9 million, partially offset by lower gross revenues
        at
        Fitzgeralds Tunica and Fitzgeralds Black Hawk of $4.1 million and $1.5 million,
        respectively.
 
 Consolidated
        casino revenues, which comprise 89.6% of consolidated gross revenues, decreased
        $2.6 million, or 1.3%, to $191.3 million, in the six-month period ended June
        30,
        2007, from $193.8 million in the similar period last year. The decline is
        due to
        the competitive markets in which our casinos operate, a decline in table
        games
        win percentages, particularly at our Majestic Properties and Fitzgeralds
        Tunica,
        and the implementation of downloadable promotional credits, again at our
        Fitzgeralds Tunica property.
 
 Consolidated
        food and beverage revenues increased $4.5 million to $12.8 million, primarily
        due to a $4.2 million increase at the Majestic Properties. Again, the improved
        food and beverage revenues at the Majestic Properties results from our taking
        over the restaurant operations in the Buffington Harbor pavilion.
 
 During
        the six-month period ended June 30, 2007, promotional allowances, which are
        deducted from gross operating revenues to arrive at net revenues, increased
        $3.3
        million to $29.0 million from $25.7 million in the same period last year.
        The
        increase is due to enhanced promotional efforts at the Majestic Properties,
        which increased $7.4 million. As mentioned above, the Majestic Properties
        were
        more aggressive with promotional allowances in order to increase customer
        visits
        and attract new customers to the properties. Fitzgeralds Tunica had a decrease
        in promotional allowances of $4.0 million, resulting from downloadable
        promotional credits.
 
 In
        the
        six-month period ended June 30, 2007, as compared to the same six-month period
        last year, operating costs and expenses increased by $8.0 million. Operating
        expenses were up $6.3 million at the Majestic Properties, primarily as a
        result
        of greater casino, food and beverage, advertising and promotional, and gaming
        tax expenses, plus the loss on sale and write-down of obsolete slot machines
        as
        mentioned earlier, partly offset by a decrease in general and administrative
        expense. Operating expenses increased $2.7 million at Fitzgeralds Tunica,
        primarily as a result of greater advertising and promotional, and depreciation
        expenses. Operating costs and expenses declined $0.7 million at Fitzgeralds
        Black Hawk and $0.2 million at corporate.
  As
        a
        result of a $0.9 million decline in net revenues, which follows from our
        $2.4
        million increase in gross revenues and the $3.3 million increase in promotional
        allowances, and our $8.0 million increase in operating expenses, operating
        income declined by $8.9 million. Coupling the decline in operating income
        with a
        $0.9 million increase in interest expense results in a $9.6 million decline
        in
        consolidated net income.
  27
 *Table
            of Contents*
  **OTHER
        DEVELOPMENTS THAT MAY IMPACT OUR OPERATIONS**
 
 ·
            Competition
                in our markets remains intense and continued aggressive marketing
                by our
                competitors in all our markets will require us to maintain a high
                level of
                marketing and promotional expenses.  ·
            Enhancements
                to existing casino facilities of our competitors and new casino facilities
                that should open in the second half of 2007 and in 2008 will increase
                the
                level of competition our Majestic Properties experience in northwest
                Indiana. 
 ·
            As
                mentioned previously, Fitzgeralds Tunica’s management team continues to
                make improvements to the property in order to attract customers that
                have
                a higher worth to the casino. Part of the property’s future plans includes
                a high-limit blackjack pit, remodeling the casino floor, opening
                a small
                poker room and remodeling the buffet. Our ability to undertake these
                projects will be contingent on improving cash
                flow. 
 ·
            The
                Company’s ability to undertake significant property remodel and expansion
                projects in order to remain competitive in its markets is contingent
                upon
                its ability to successfully acquire the necessary financing to undertake
                these projects. The Company, under the terms of the indentures governing
                its outstanding notes and the loan and security agreement governing
                its
                Senior Secured Credit Facility, must meet certain financial ratios
                before
                incurring any additional debt. Given the Company’s current and past
                financial performance, the ability of the Company to incur additional
                debt, under the existing indentures and loan and security agreement
                is
                limited.  28
 *Table
            of Contents*
  **Operating
        Results by Entity**
 For
                  The Three Months Ended
              
              For
                  The Six Months EndedJune
                  30,
              
              June
                  30,(in
                  thousands)
              
              
              
              2007
              
              2006
              
              2007
              
              2006Gross
                  revenues:Majestic
                  Properties
              
              
              
              
              $
              71,758
              
              $
              60,955
              
              $
              143,260
              
              $
              135,344Fitzgeralds
                  Tunica
              
              
              
              
              
              27,303
              
              
              27,867
              
              
              52,087
              
              
              56,163Fitzgeralds
                  Black Hawk
              
              
              
              
              
              9,056
              
              
              9,592
              
              
              18,204
              
              
              19,660Total
              
              
              
              
              $
              108,117
              
              $
              98,414
              
              $
              213,551
              
              $
              211,167Net
                  revenues:Majestic
                  Properties
              
              
              
              
              $
              62,864
              
              $
              56,064
              
              $
              126,088
              
              $
              125,575Fitzgeralds
                  Tunica
              
              
              
              
              
              22,406
              
              
              21,237
              
              
              42,926
              
              
              42,970Fitzgeralds
                  Black Hawk
              
              
              
              
              
              7,635
              
              
              8,256
              
              
              15,585
              
              
              16,930Total
              
              
              
              
              $
              92,905
              
              $
              85,557
              
              $
              184,599
              
              $
              185,475Casino
                  revenues:Majestic
                  Properties
              
              
              
              
              $
              65,802
              
              $
              58,075
              
              $
              132,270
              
              $
              129,205Fitzgeralds
                  Tunica
              
              
              
              
              
              21,912
              
              
              22,912
              
              
              42,018
              
              
              46,264Fitzgeralds
                  Black Hawk
              
              
              
              
              
              8,424
              
              
              8,955
              
              
              16,980
              
              
              18,359Total
              
              
              
              
              $
              96,138
              
              $
              89,942
              
              $
              191,268
              
              $
              193,828Operating
                  income (loss):Majestic
                  Properties
              
              
              
              
              $
              9,657
              
              $
              10,274
              
              $
              19,367
              
              $
              25,139Fitzgeralds
                  Tunica
              
              
              
              
              
              2,024
              
              
              1,907
              
              
              2,875
              
              
              5,586Fitzgeralds
                  Black Hawk
              
              
              
              
              
              1,505
              
              
              1,988
              
              
              3,115
              
              
              3,730Corporate
                  (1)
              
              
              
              
              
              (1,779
              )
              
              (1,931
              )
              
              (3,532
              )
              
              (3,772
              )Total
              
              
              
              
              $
              11,407
              
              $
              12,238
              
              $
              21,825
              
              $
              30,683Operating
                  margin (2):Majestic
                  Properties
              
              
              
              
              
              15.4
              %
              
              18.3
              %
              
              15.4
              %
              
              20.0
              %Fitzgeralds
                  Tunica
              
              
              
              
              
              9.0
              %
              
              9.0
              %
              
              6.7
              %
              
              13.0
              %Fitzgeralds
                  Black Hawk
              
              
              
              
              
              19.7
              %
              
              24.1
              %
              
              20.0
              %
              
              22.0
              %Total
              
              
              
              
              
              12.3
              %
              
              14.3
              %
              
              11.8
              %
              
              16.5
              %Expenditure
                  for additions to long-lived assets:Majestic
                  Properties
              
              
              
              
              $
              3,364
              
              $
              761
              
              $
              4,528
              
              $
              2,927Fitzgeralds
                  Tunica
              
              
              
              
              
              1,562
              
              
              835
              
              
              5,611
              
              
              1,337Fitzgeralds
                  Black Hawk
              
              
              
              
              
              3,814
              
              
              701
              
              
              4,666
              
              
              1,190Corporate
              
              
              
              
              
              26
              
              
              118
              
              
              49
              
              
              123Total
              
              
              
              
              $
              8,766
              
              $
              2,415
              
              $
              14,854
              
              $
              5,577
 Notes:
 (1)
              Corporate
                  expenses reflect payroll, benefits, travel and other costs associated
                  with
                  our corporate staff and are not allocated to the
                  properties.(2)
              Operating
                  margin is calculated by dividing operating income by net
                  revenues.
  29
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  ***Property
        Operating Results: June 30, 2007 Compared To June 30,
        2006***
 
 
 **Majestic
        Properties**
 
 Gross
        revenues for the quarter ended June 30, 2007 were $71.8 million at the Majestic
        Properties compared to $61.0 million in the same period in 2006, an increase
        of
        $10.8 million, or 17.7%. Casino revenues, which make up 91.7% of the gross
        revenues, were $65.8 million, an increase of $7.7 million, or 13.3%, compared
        to
        $58.1 million in the prior year. The increase in casino revenues resulted
        from
        increases in slot coin in of 2.7% and table games drop of 54.3%.  Food and
        beverage revenues were $3.5 million in the second quarter of 2007 compared
        to
        $0.9 million in the same quarter last year, an increase of $2.6 million as
        a
        result of the Majestic Properties taking over the food and beverage operations
        in the Buffington Harbor pavilion during the first quarter of 2007.
 
 For
        the
        quarter ended June 30, 2007, operating income was $9.7 million compared to
        $10.3
        million in the prior year quarter, a decrease of $0.6 million. The decrease
        was
        the result of increases of $4.0 million in promotional allowances and $7.4
        million in operating costs and expenses. Promotional allowances increased
        due to
        higher complimentary food and beverage revenues as a result of the Majestic
        Properties taking over the food and beverage operations in the Buffington
        Harbor
        pavilion. These food and beverage operations were previously operated by
        third
        parties, who charged the Majestic Properties for meals provided to the casino
        customers of the Majestic Properties. Casino expense increased $3.1 million,
        primarily due to an increase in the cost of complimentary meals provided
        to
        casino customers, payroll and slot equipment lease expense. Gaming taxes
        increased $2.3 million due to higher casino revenues. Food and beverage expenses
        increased $0.9 million due to the increase in food and beverage volumes.
        In the
        current quarter, the Majestic Properties recorded a loss on sale and write
        down
        of obsolete slot machines of $0.8 million.
 
 Gross
        revenues for the six-month period ended June 30, 2007 were $143.3 million
        compared to $135.3 million in the same period in 2006, an increase of $7.9
        million, or 5.8%. Casino revenues, which make up 92.3% of the gross revenues,
        were $132.3 million, an increase of $3.1 million, or 2.4%, compared to $129.2
        million in the prior year. The increase in casino revenues at the Majestic
        Properties resulted from an increase in table games drop of 15.9%, partially
        offset by a decrease in table games hold percentage of 0.6%. Slot revenue
        was
        relatively unchanged. Food and beverage revenues were $6.3 million in the
        current six-month period compared to $2.1 million in the same six- month
        period
        last year, an increase of $4.2 million as a result of the Majestic Properties
        taking over the food and beverage operations in the Buffington Harbor
        pavilion.
 
 For
        the
        six-month period ended June 30, 2007, operating income was $19.4 million
        compared to $25.1 million in the prior year, a decrease of $5.7 million.
        The
        decrease was due to increases of $7.4 million in promotional allowances and
        $6.3
        million in operating costs and expenses. Promotional allowances increased
        due to
        higher complimentary food and beverage revenues as a result of the Majestic
        Properties taking over the food and beverage operations in the pavilion.
        Casino
        expense increased $3.5 million, primarily due to an increase in the cost
        of
        complimentary meals provided to casino customers, payroll and slot equipment
        lease expense. Food and beverage expenses increased $1.7 million due to the
        increase in food and beverage volumes. In the current six-month period, the
        Company recorded a loss on sale and write down of slot machines of $0.8
        million.
 
 
 **Fitzgeralds
        Tunica**
 
 Gross
        revenues for the quarter ended June 30, 2007 were $27.3 million at Fitzgeralds
        Tunica compared to $27.9 million in the same period in 2006, a decrease of
        $0.6
        million, or 2.0%. Casino revenues, which make up 80.3% of the gross revenues,
        were $21.9 million, a decrease of $1.0 million, or 4.4%, compared to $22.9
        million in the prior year. Table games revenues increased $0.9 million as
        a
        result of increased table games drop of 26.2%. Slot revenues decreased $1.9
        million primarily due to downloadable promotional credits. Downloadable
        promotional credits reduced slot revenues by $2.2 million in the second quarter
        of 2007 compared to the same quarter last year, which was partially offset
        by a
        corresponding decline in promotional allowances of $1.7 million. As a result
        of
        the downloadable promotional credit program, we significantly reduced the
        amount
        of cash coupons mailed and redeemed by our customers. These cash coupons,
        when
        redeemed, were recorded in promotional allowances. The decrease in casino
        revenues was partially offset by an increase in food and beverage revenues
        of
        $0.4 million, due to increased redemption of direct mail buffet
        coupons.
  30
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  For
        the
        quarter ended June 30, 2007, operating income was $2.0 million compared to
        $1.9
        million in the prior year quarter, an increase of $0.1 million. A $1.1 million
        increase in operating costs and expenses largely offset the decrease in
        promotional allowances and contributed to the small increase in operating
        income. Advertising and promotional expenses increased $1.0 million due to
        increased junket, guest transportation and player development costs. In
        addition, depreciation expense increased $0.5 million as a result of the
        purchase of the slot machines and equipment, and completion of the phased
        hotel
        remodeling project. Offsetting the above were decreased casino, and food
        and
        beverage expenses.
 
 Gross
        revenues for the six-month period ended June 30, 2007 were $52.1 million
        compared to $56.2 million in the same period in 2006, a decrease of $4.1
        million, or 7.3%. Casino revenues, which make up 80.7% of the gross revenues,
        were $42.0 million, a decrease of $4.3 million, or 9.2%, compared to $46.3
        million in the prior year. Table games revenues increased $0.2 million as
        an
        increase in table games drop of 27.0% was partially offset by a decrease
        in hold
        percentage of 3.3%. Slot revenues decreased $4.4 million primarily due to
        downloadable promotional credits. Downloadable promotional credits created
        a
        reduction in slot revenues by $4.4 million in the first six months of 2007
        when
        compared to the same period last year, which was mostly offset by a
        corresponding reduction in promotional allowances of $4.0 million. As a result
        of the downloadable promotional credit program, we significantly reduced
        the
        amount of cash coupons mailed and redeemed by our customers which is a direct
        reduction in promotional allowances.
 
 For
        the
        six-month period ended June 30, 2007, operating income was $2.9 million compared
        to $5.6 million in the prior year quarter, a decrease of $2.7 million. An
        increase of $2.7 million in operating costs and expenses contributed to the
        decline in operating income. Advertising and promotional expenses increased
        $1.9
        million due to increased junket, guest transportation and player development
        costs. In addition, depreciation expense increased $1.0 million as a result
        of
        the purchase of the slot machines and equipment, and completion of the phased
        hotel remodeling project.
 
 
 **Fitzgeralds
        Black Hawk**
 
 Gross
        revenues for the quarter ended June 30, 2007 were $9.1 million at Fitzgeralds
        Black Hawk compared to $9.6 million in 2006, a decrease of $0.5 million,
        or
        5.6%. Casino revenues, which make up 93.0% of the gross revenues, were $8.4
        million, a decrease of $0.5 million, or 5.9%, compared to $8.9 million in
        the
        prior year. The decrease in casino revenues resulted from a decrease in slot
        coin in of 10.2%. Revenues were negatively impacted by road construction
        on the
        main highway into Black Hawk, and improved facilities and greater levels
        of
        marketing from our competitors.
 
 For
        the
        quarter ended June 30, 2007, operating income was $1.5 million compared to
        $2.0
        million in the prior year quarter, a decrease of $0.5 million, or 24.3%.
        The
        decline in operating income is the result of our lower casino revenues as
        expenses have remained consistent with the prior year period.
 
 Gross
        revenues for the six-month period ended June 30, 2007 were $18.2 million
        compared to $19.7 million in the prior year period, a decrease of $1.5 million,
        or 7.4%. Casino revenues, which make up 93.3% of the gross revenues, were
        $17.0
        million, a decrease of $1.4 million, or 7.5%, compared to $18.4 million in
        the
        prior year. The decrease in casino revenues resulted from lower slot coin
        in of
        14.6%, which was partially offset by an increase in slot hold percentage
        of
        0.4%. Revenues were negatively impacted by poor weather earlier in the year,
        road construction, and improved facilities and greater levels of marketing
        from
        our competitors.
 
 For
        the
        six-month period ended June 30, 2007, operating income was $3.1 million compared
        to $3.7 million in the prior year period, a decrease of $0.6 million, or
        16.5%.
        The decline in operating income resulted from our reduced casino revenues;
        however, this was somewhat mitigated by a decline in casino expenses and
        gaming
        taxes of $0.9 million.
 
 
 **Corporate**
 
 Corporate
        operating expense for the quarters and six-month periods ended June 30, 2007
        and
        2006 were $1.8 million and $1.9 million, respectively, and $3.5 million and
        $3.8
        million, respectively. Corporate operating expenses reflect payroll, benefits,
        travel and other costs associated with our corporate staff and are not allocated
        to the properties.
  31
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  **Other
        income (expense)**
 
 Other
        expense increased by $0.4 million to $15.3 million for the quarter end June
        30,
        2007 and by $0.8 million to $30.4 million for the six-month period ended
        June
        30, 2007. The main component of other expense is interest expense, which
        increased $0.5 million and $0.9 million, respectively, in the three- and
        six-month periods ended June 30, 2007 as compared to the prior year periods,
        due
        to higher interest rates and greater amounts drawn on our credit facility
        during
        the 2007 periods as compared to the prior year periods. The accretion of
        the
        Discount Notes added $0.2 million and $0.4 million, respectively, in additional
        interest expense.
 
 
 **LIQUIDITY
        AND CAPITAL RESOURCES**
 
 To
        date,
        we have financed our operations with internal cash flows from our operations
        and
        borrowings under the Senior Secured Credit Facility. We generate substantial
        cash flows from operating activities. In the six months ended June 30, 2007
        and
        2006, we reported cash flows from operating activities of $12.6 million and
        $11.8 million, respectively. We use our cash flows to meet our financial
        obligations, which consist principally of financing the daily operations
        of our
        casinos, servicing our debt, funding capital improvements and projects, making
        distributions under the Manager Agreement and tax distributions to BDI.
 
 The
        Company has significant debt outstanding, including $53.1 million drawn on
        its
        Senior Secured Credit Facility ($26.9 million available to draw), $300.0
        million
        of Senior Secured Notes, $200.0 million of Senior Notes and $0.1 million
        of
        capital leases and other debt. As a result of the significant interest
        associated with our debt obligations and lower than anticipated financial
        performance, in the past, the Company has needed to amend the financial
        covenants of the Senior Secured Credit Facility in order to avoid a covenant
        violation under the Senior Secured Credit Facility (see discussion below).
 
 In
        2007,
        in addition to servicing the Company’s significant debt obligations, the Company
        plans to spend a total of approximately $32.4 million on property improvements.
        Included in the $32.4 million is the completed Fitzgeralds Tunica hotel remodel
        project and equipment purchased, which primarily consists of slot machines.
        Also included in the $32.4 million is the Fitzgeralds Black Hawk expansion
        and
        re-building of the Rohling Inn, which is anticipated to cost $17.0 million
        in
        2007 and a total of $31.4 million overall. (see discussion below). The Company
        also made tax distributions to its manager in the second quarter of 2007
        of $2.2
        million for
        resolution of an IRS audit and Indiana income taxes,and will need
        to make additional tax distributions based upon the state and federal taxable
        income generated by the Company.
 
 The
        Company faces significant competition in each of its markets. In addition,
        in
        the market in which our Majestic Properties compete, new and improved facilities
        are planned to be opened in August 2007 and mid 2008. These new and improved
        facilities could have a negative impact on the operating cash flows generated
        by
        our Majestic Properties and the Company. If operating cash flows are not
        at a
        level to support the Company’s debt service obligations, planned capital
        expenditures, including the Fitzgeralds Black Hawk expansion, and tax and
        manager distributions, the Company will need to draw on its Senior Secured
        Credit Facility or seek other forms of financing. There is no guarantee that
        such financing would be available to the Company on reasonable terms, if
        at all,
        and the Company’s ability to incur additional debt is restricted by the terms of
        the Senior Secured Credit Facility and the indentures governing our outstanding
        Senior Secured Notes and Senior Notes. The Company may, therefore, be required
        to modify the scope or timing of its planned capital expenditures.
 
 The
        Company will be required to pay any amounts outstanding on the Senior Secured
        Credit Facility, plus accrued interest thereon, in April 2010. In addition,
        beginning April 15, 2009, our parent will likely look to us to distribute
        cash to pay interest on the Discount Notes. Our ability to distribute cash
        to
        Majestic Holdco is limited unless certain financial tests are met. The Senior
        Secured Notes mature in October 2010 and the Senior Notes mature in January
        2011. No assurance can be given that our operating cash flows or proceeds
        from
        additional financings, if available, will be sufficient for such
        purposes.
  32
 *Table
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  The
        Company had unrestricted cash and cash equivalents of $27.6 million at June
        30,
        2007. The Company does not hold excess cash in its bank accounts. Any excess
        cash is used to pay down the Senior Secured Credit Facility. In the first
        six
        months of 2007, we spent approximately $14.9 million for the purchase of
        slot
        machines, upgrading the Fitzgeralds Tunica hotel and other remodeling projects,
        and the Fitzgeralds Black Hawk expansion .
        In the
        same period of 2006, the Company spent $5.6 million for the purchase of new
        slot
        machines, the integration of slot machines with ticket-in-ticket-out (“TITO”)
        technology at all of our properties, re-branding Trump Indiana as Majestic
        Star
        II and integration of our computer systems with Trump Indiana.
 
 Fitzgeralds
        Black Hawk is expanding its facility by rebuilding the Masonic Building and
        Rohling Inn properties, as a part of a major casino expansion. To date the
        project is approximately 30% complete. Management expects the casino expansion
        to cost approximately $31.4 million, including the reconstruction of the
        Masonic
        Building and Rohling Inn and the purchase of associated gaming equipment
        and
        other furniture and fixtures. The rebuilt Masonic Building will be four stories
        with a gaming mezzanine, which should allow us to add up to 400 slot machines
        and a food outlet. The Rohling Inn will be used for administration and contain
        space for hosting player events. The construction on the Rohling Inn is
        anticipated to be completed in the third quarter of 2008 and the Masonic
        Building by June/July 2008. A portion of the costs to re-build the Rohling
        Inn
        will be covered by insurance. At this time, the insurance company has yet
        to
        determine how much of the reconstruction is covered under the Company’s policy,
        but has paid the Company $1.4 million against the claim. The Company is allowed,
        pursuant to the terms of the Senior Secured Credit Facility, to spend $25.0
        million on the Fitzgeralds Black Hawk expansion. Any amounts spent in excess
        of
        $25.0 million would come out of the allowable annual capital expenditures,
        as
        specified in the Senior Secured Credit Facility, of $25.0 million in 2007
        and
        $30.0 million in 2008. The Fitzgeralds Black Hawk expansion will be funded
        by
        cash flow from operations and advances from the Senior Secured Credit
        Facility.
 
 The
        Company continues to evaluate plans to upgrade and improve our casino operations
        at Buffington Harbor in Gary, Indiana. The Company is precluded by the Senior
        Secured Credit Facility from making capital expenditures in excess of $25.0
        million in 2007 and $30.0 million in each year thereafter (excluding up to
        $25.0
        million to expand Fitzgeralds Black Hawk) until the Senior Secured Credit
        Facility matures in 2010. As a result of the Company’s capital expenditure
        limitation, current level of indebtedness and operating cash flows, the Company
        may need to seek partners to provide financing for these projects, receive
        a
        contribution from its member or seek to amend the capital expenditure covenant
        contained within the Senior Secured Credit Facility.
 
 The
        Company is also exploring the opportunity to replace its two existing gaming
        vessels in Gary, Indiana with two single-level gaming vessels. Management
        believes, with the new and improved casinos planned to open in its Indiana
        market, such vessels may be necessary to remain competitive. The two existing
        gaming vessels are multi-level, which makes it more difficult for guests
        to move
        about the casinos and less efficient for the Company in operating these casinos,
        as opposed to single-level casinos. While no specific cost has been established
        on developing two single-level gaming vessels, whatever financing would be
        necessary would be outside of the allowable covenants contained within the
        Company’s Senior Secured Credit Facility and the indentures governing the Senior
        Secured Notes and Senior Notes. Thus, to build two single-level gaming vessels
        would require a significant equity infusion from our member or a partner,
        or
        other alternative financing.
 
 In
        the
        past the Company had made distributions to fund its member’s income tax
        liabilities and the Company anticipates that it will make future distributions.
        The indentures governing the Senior Secured Notes and the Senior Notes and
        the
        loan and security agreement for the Senior Secured Credit Facility allow
        for
        distributions to our member to pay income taxes. The ultimate resolution
        of the
        assessments by the Indiana Department of Revenue against the Company and
        BDI, in
        the amount of $4.1 million related to the add back of gross wagering tax
        when
        computing Indiana state income tax, plus interest, could have a material
        impact
        on the Company’s liquidity in the period that the taxes are paid, if any, and to
        the extent that the Company makes distributions to its member for tax
        purposes related to such resolution (see Part II, Item 1, Legal Proceedings,
        under the caption, Majestic Star Income Tax Protest).
 
 The
        purchase of certain gaming facilities by larger more recognized brand names
        or
        the expansion of gaming in jurisdictions in which gambling is already legal
        (or
        currently illegal) could significantly increase competition for the Company
        and
        thereby require additional investment by the Company in its facilities, gaming
        devices and marketing efforts. If necessary, and to the extent permitted
        under
        the indentures governing the Senior Secured Notes and Senior Notes, the Company
        would seek additional financing through borrowings of debt or equity financing,
        subject to any governmental approvals. There can be no assurance that additional
        financing, if needed, will be available to the Company or that, if available,
        the financing will be on terms favorable to the Company.
  33
 *Table
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  **Credit
        Facility Amendments**
 
 On
        March 15, 2007, the Company entered into Amendment Seven to the Senior
        Secured Credit Facility. Amendment Seven modifies the Company’s minimum EBITDA
        requirement for the twelve-month periods ended March 31, 2007, June 30,
        2007 and September 30, 2007, to $65.0 million, respectively, modifies the
        minimum EBITDA requirement for the 12-month periods ended December 31,
        2007, March 31, 2008 and June 30, 2008, to $70.0 million, respectively, and
        modifies the minimum EBITDA requirement to $72.0 million and $74.0 million
        for
        the 12-month periods ended September 30, 2008 and December 31, 2008,
        respectively. Amendment Seven also modifies the Company’s interest coverage
        ratio requirement for the 12-month periods ended March 31, 2007, June 30,
        2007, September 30, 2007, December 31, 2007, March 31, 2008 and
        June 30, 2008, to 1.20:1.0, respectively, and modifies the interest
        coverage ratio requirement to 1.25:1.0 for the 12-month periods ended
        September 30, 2008 and December 31, 2008, respectively.
 
 The
        Company was in compliance with the financial covenants contained in the Senior
        Secured Credit Facility at June
        30 ,
        2007.
 
 
 **CRITICAL
        ACCOUNTING POLICIES**
 
 Our
        consolidated financial statements are prepared in accordance with accounting
        principles generally accepted in the United States of America, which require
        our
        management to make estimates and assumptions about the effects of matters
        that
        are inherently uncertain. We have summarized our significant accounting policies
        in Note 2 to our consolidated financial statements contained in our Annual
        Report on Form 10-K for the year ended December 31, 2006 and in Note 2 to
        the interim financial statements as of June 30, 2007 as contained herein.
 
 **RECENTLY
        ISSUED ACCOUNTING PRONOUNCEMENTS**
 
  The
        Company keeps abreast of new generally accepted principles and disclosure
        reporting requirements issued by the SEC and other standard setting agencies.
        Recently issued accounting standards which may affect the financial results
        are
        noted in Note 3 of the Notes to Condensed Consolidated Financial Statements.
 
 
 **CONTRACTUAL
        COMMITMENTS**
 
 There
        have been no material changes from the information reported in the Company's
        Annual Report on Form 10-K for the fiscal year ended December 31,
        2006.
 
 
 **Item
        3.****Quantitative and Qualitative Disclosures About Market
        Risk.**
 
 There
        have been no material changes from the information reported in the Company's
        Annual Report on Form 10-K for the fiscal year ended December 31,
        2006.
 
 
 **Item
        4T. Controls and Procedures.**
 
 Disclosure
        Controls and Procedures
 
 As
        of the
        end of the period covered by this report, the Company carried out an evaluation,
        under the supervision and with the participation of the Company's management,
        including its Chief Executive Officer and Chief Financial Officer, of the
        effectiveness of the design and operation of the Company's disclosure controls
        and procedures pursuant to Rule 15d-15 of the Securities Exchange Act of
        1934.
        Based upon that evaluation, the Company's Chief Executive Officer and Chief
        Financial Officer concluded that the Company's disclosure controls and
        procedures are effective to cause the material information required to be
        disclosed by the Company in the reports that it files or submits under the
        Securities Exchange Act of 1934 to be recorded, processed, summarized and
        reported within the time periods specified in the SEC's rules and
        forms.
  34
 *Table
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  We
        maintain disclosure controls and procedures that are designed to ensure that
        information required to be disclosed in our Exchange Act reports is recorded,
        processed, summarized and reported within the time periods specified in the
        SEC's rules and forms, and that such information is accumulated and communicated
        to our management, including our Chief Executive Officer and Chief Financial
        Officer, as appropriate, to allow timely decisions regarding required
        disclosure. In designing and evaluating the disclosure controls and procedures,
        management recognized that any controls and procedures, no matter how well
        designed and operated, can provide only reasonable assurance of achieving
        the
        desired control objectives.
 
 Changes
        in Internal Control over Financial Reporting
 
 There
        have been no changes in the Company's internal controls over financial reporting
        during the quarter ended June 30, 2007 that have materially affected, or
        are
        reasonably likely to materially affect, the Company's internal controls over
        financial reporting.
 
  35
 *Table
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  **PART
        II****OTHER
        INFORMATION**
 
 
 **Item
        1.**   **Legal
        Proceedings.**
 
 Information
        regarding Legal Proceedings appears in Part I - Item 3 of our Annual Report on
        Form 10-K for the fiscal year ended December 31, 2006, Part II - Item 1 of
        our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
        2007
        and Note 5 to the Condensed Consolidated Financial Statements included
        herein.
 
 Insurance
        Litigation. In
        February 2006, the Company’s previous stop-loss health insurance provider
        (“Insurance Provider”), through its third party auditor, contacted the Company
        and requested that the Company provide information to facilitate an audit
        of
        employee health insurance stop-loss coverage for the years of 2004 and 2005.
        Although the Company had provided the requested information, as a result
        of this
        audit process, the Insurance Provider has withheld payment on ten individual
        claims that are payable under our stop-loss insurance policy with an aggregate
        outstanding value of approximately $0.7 million. After numerous attempts
        by the
        Company to request and facilitate the completion of the audit, the Company
        filed
        suit on May 3, 2007 in United States District Court for the Northern District
        of
        Illinois against the Insurance Provider alleging: (i) breach of contract,
        (ii)
        unfair practices in settling claims, (iii) bad faith and (iv) breach of
        fiduciary duty. On June 8, 2007 the Insurance Provider filed an Answer,
        Affirmative Defense and Counterclaim Adding Parties asserting three separate
        substantive claims including: (i) recession, (ii) negligent misrepresentation
        and (iii) breach of contract, alleging that the Company failed to meet
        enrollment requirements, keep proper records and, pay proper insurance premiums
        for covered employees. On June 28, 2007 the Company responded to the
        Counterclaim with an Answer and Affirmative Defenses to Counterclaim denying
        the
        above Counterclaim’s allegations. While the Company continues to believe that it
        is entitled to reimbursement of all claims paid under the obligations of
        the
        insurance policy, at this point in time the Company is unable to assess the
        amount or likelihood of recovery.
 
 Majestic
        Star Income Tax Protest. The
        Company and its ultimate parent, BDI, have been assessed $2.6 million and
        $1.3
        million respectively, plus interest, by the Indiana Department of Revenue.
        Additionally, BDI’s non-resident shareholder has been assessed $0.2 million,
        plus penalty and interest. The assessments relate to deductions for payments
        of
        taxes on adjusted gross gaming revenues the Company’s member took in computing
        adjusted gross income for Indiana state income tax purposes. The Department’s
        position is that the Company had an obligation to withhold and remit tax
        for the
        non-resident shareholder of its member. The Company, BDI and BDI’s non-resident
        shareholder timely filed protests for all tax years at issue with the Legal
        Division of the Department. The Department sustained the imposition of
        negligence penalties on the assessments, but denied the protest of the tax
        amount assessed to the extent that amounts assessed are in excess of net
        operating losses available to BDI’s non-resident shareholder. The Company and
        BDI have filed petitions with the Indiana Tax Court appealing the Department’s
        ruling on the $2.6 million and $1.3 million assessments. BDI's non-resident
        shareholder filed an appeal with the Indiana Tax Court on May 14, 2007 regarding
        the $0.2 million assessment. The Department has issued discovery requests
        to
        which the Company is in the process of responding. Upon the completion of
        discovery process, the Indiana Tax Court will schedule this matter for trial
        or
        dispositive pre-trial motions. No liability has been accrued by the Company
        relating to this matter.
 
 The
        Company’s indentures governing the Senior Secured Notes, the Senior Notes, and
        the loan agreement related to the Senior Secured Credit Facility allow the
        Company to make distributions to BDI for tax purposes. Accordingly, should
        BDI
        ultimately be found liable for additional state income taxes to the State
        of
        Indiana, the Company would make distributions sufficient to pay the additional
        tax. Any payments would be recorded as distributions in Member’s Deficit. The
        Company does not intend to make any distributions until it has fully evaluated
        its options with BDI.
  36
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  BHR
        and Majestic Star Sales and Use Tax Assessments. For
        the
        years 1998 through 2004, the Department assessed BHR and Majestic Star $0.9
        million for unpaid sales and use taxes related to merchandise and other products
        provided to the guests and employees of Majestic Star and BHR at no charge
        and
        the provision of food, provided on a complimentary basis, to the patrons
        and
        employees of BHR’s members Majestic Star and Trump Indiana, and to Majestic Star
        directly. Based on Hyatt Corp v. Indiana Department of State Revenue, BHR
        and
        Majestic Star believe that they have no sales and use tax liability for food
        for
        human consumption purchased by it and prepared for serving to its customers
        on a
        complimentary basis. In Hyatt, the petitioner, a hotel operator, sought a
        refund
        for use tax paid on food purchased for complimentary meals that were provided
        to
        both guests and employees. Hyatt prevailed. Majestic Star and BHR are arguing
        that food prepared for human consumption and provided to customers and employees
        on a complimentary basis are not taxable per the Hyatt decision. Should the
        Department prevail with its position that sales taxes are due on the value
        of
        complimentary meals Majestic Star and BHR provided to employees and customers
        of
        Majestic Star, the estimated 2005 sales tax exposure for the complimentary
        meals
        will be an additional $0.1 million. Pursuant to the terms of the stock purchase
        agreement with Trump Entertainment Resorts Holdings, L.P., TERH is obligated
        to
        indemnify the Company for 50% of BHR’s pre-closing tax liabilities. With regard
        to BHR’s sales and use tax assessments, BHR protested these proposed assessments
        in August 2006, the Department issued a ruling in June, 2007 denying BHR’s
        protest, and BHR anticipates that an appeal of that ruling will be filed on
        or before August 20, 2007. The indemnification amount would be $0.4 million
        for BHR’s sales and use tax assessments. Estimated exposure for the years ended
        December 31, 2005, December 31, 2006 and the first six months of 2007,
        which would be the Company’s obligation only, would be approximately $0.1
        million, $0.2 million and $0.2 million, respectively. On May 1, 2007, the
        Indiana Tax Court issued a decision in another sales and use tax case involving
        a riverboat casino with facts similar to the facts in Majestic Star’s and BHR’s
        cases outlined above. In that case, the court ruled that the provision of
        food
        and non-food items provided to that casino’s customers on a complimentary basis
        did not constitute retail sales subject to Indiana sales tax, and that the
        provision of food for human consumption, which had been exempt from Indiana
        sales tax when purchased, was likewise exempt from use tax when such food
        was
        later prepared and provided to patrons on a complimentary basis. On May 31,
        2007, the Department filed a Petition for Review of the Tax Court’s decision in
        that case with the Indiana Supreme Court. On August 7, 2007, the Indiana
        Supreme
        Court issued an order denying further review of the Tax Court’s decision.
  
 **Item
        1A.****Risk
        Factors.**
 
 Information
        regarding risk factors appears in Part I - Item 1A of our Annual Report on
        Form
        10-K for the fiscal year ended December 31, 2006. The following risk
        factors reflect certain material changes from the risks previously disclosed
        in
        our Annual Report on Form 10-K:
 
 **Increased
        competition in Chicagoland market**
 
 On
        April 4, 2007, Ameristar Casinos, Inc. announced that it has entered into a
        definitive agreement with Resorts International Holdings, LLC to acquire
        its
        subsidiary that owns and operates Resorts East Chicago. Ameristar intends
        to
        make a number of major capital improvements to Resorts East Chicago. It intends
        to significantly expand the gaming facilities, improve access to the casino,
        build additional structured parking and upgrade the non-gaming amenities.
        While
        we cannot determine what effect this will have on our future operations in
        the
        Chicagoland market, it may have a significant impact on how we operate our
        business to remain competitive.
 
 **Higher
        energy costs**
 
 Due
        to
        the recent increase in energy prices, there is a greater risk that our patrons
        will have less discretionary income due to higher fuel costs. Customers may
        also
        be less likely to travel or may be more likely to reduce the number of trips
        to
        our casinos.
 
 **Black
        Hawk construction projects**
 
 If
        there
        is a shortfall in the insurance proceeds we expect to receive for the rebuilding
        of the Rohling Inn at Black Hawk, we will need to reallocate our capital
        expenditure budget to cover these costs in order to stay within our capital
        expenditures limitation in our loan covenants. This will limit our ability
        to
        implement other planned expenditures at our properties.
  37
 *Table
            of Contents*
  
 
 **Item
        6.****Exhibits.**
 
 (a)
            The
                following exhibits are filed as part of this
                report: 
 **Exhibit
                    No.**
                
                **Description
                    of Document**10.1*
                
                Deferred
                    Compensation Plan31.1**
                
                Certification
                    of Chief Executive Officer pursuant to Rule 15d-14 of the Securities
                    Exchange Act of 1934, as adopted pursuant to Section 302 of the
                    Sarbanes-Oxley Act of 2002.31.2**
                
                Certification
                    of Chief Financial Officer pursuant to Rule 15d-14 of the Securities
                    Exchange Act of 1934, as adopted pursuant to Section 302 of the
                    Sarbanes-Oxley Act of 2002.32**
                
                Certification
                    pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                    906 of
                    the Sarbanes-Oxley Act of 2002.
 
 *
                Incorporated
                    by reference to the Company’s current report on Form 8-K dated May 24,
                    2007.**
                Filed
                    herewith.
 
 
 
  38
 *Table
            of Contents*
   **SIGNATURES**
 
 Pursuant
        to the requirements 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.
 
 Dated:
                  August 14, 2007THE
                  MAJESTIC STAR CASINO, LLC*/s/
                  Don H. Barden*Don
                  H. BardenChairman,
                  President and Chief Executive Officer(Duly
                  Authorized Officer and Principal Executive Officer)*/s/
                  Jon S. Bennett*Jon
                  S. BennettVice
                  President and Chief Financial Officer(Principal
                  Financial and Accounting Officer)THE
                  MAJESTIC STAR CASINO CAPITAL CORP.*/s/
                  Don H. Barden*Don
                  H. BardenPresident
                  and Chief Executive Officer(Duly
                  Authorized Officer and Principal Executive Officer)*/s/
                  Jon S. Bennett*Jon
                  S. BennettVice
                  President and Chief Financial Officer(Principal
                  Financial and Accounting Officer)THE
                  MAJESTIC STAR CASINO CAPITAL CORP II/*s/
                  Don H Barden*Don
                  H BardenPresident
                  and Chief Executive Officer(Duly
                  Authorized Officer and Principal Executive Officer)*/s/Jon
                  S Bennett*Jon
                  S BennettVice
                  President and Chief Financial Officer(Principal
                  Financial and Accounting Officer)
 
 
 
 
 
 S-1