1

2 MISSOURI GAMING COMMISSION

PUBLIC MEETING

9 Wednesday, November 28, 2001

10 City Council Room

11 525 Spring Street

12 Boonville, Missouri

IN RE: ISLE OF CAPRI-BOONVILLE, INC.

Reported by:

Stacy Brandes

22 BALLEW REPORTING SERVICES

2213 State Route W * 7430 Highway 40 West

23 Fayette, MO 65248 * Columbia, MO 65203

660-248-3014 * 573-446-6455

1 A P P E A R A N C E S

Missouri Gaming Commission:

Commissioners:

4 ROBERT SMITH, Vice Chairman

DR. MURIEL W. BATTLE

5 LYNNE R. NIKOLAISEN, via telephone

6 KEVIN MULLALLY, Executive Director

ANGIE FRANKS, Secretary

7 SERGEANT RICH MASON, Highway Patrol Team

STEVE JOHNSON, Deputy Director

8 PATRICIA CHURCHILL, Deputy Director for Legal and

Legislative Affairs

10 ISLE OF CAPRI-BOONVILLE, INC.:

11 TOM CAMPBELL, MO Regulatory Counsel for Isle of Capri

TOM CARR, Regional Vice President for Operations

12 JEFF KING, Vice President/General Manager

JACK GALLAWAY, President and Chief Operating Officer

14 CITY OF BOONVILLE:

15 BUD KEMPF, Mayor

TRACY WALKUP, City Manager

1 I N D E X

2 Page

3 Public Hearing called to order . . . . . . . . 4

4 Roll Call of Commissioners . . . . . . . . . . 4

5 Consideration of Suitability for Licensure . . 5

6 Presentation from Isle of Capri-Boonville, Inc. 6

7 Presentation from City of Boonville. . . . . . 21

8 Presentation of Highway Patrol Background

Investigation. . . . . . . . . . . . . . . . . 36

Presentation of Operational Issues . . . . . . 44

Presentation from Legal Representative . . . . 53

Taking up Resolution No. 01-073. . . . . . . . 54

Motion to adopt Resolution No. 01-073,

13 made by Commissioner Nikolaisen, seconded by

Commissioner Battle. . . . . . . . . . . . . . 54

Roll call of Commissioners on

15 Resolution No. 01-073. . . . . . . . . . . . . 54

16 Taking up Resolution No. 01-074. . . . . . . . 55

17 Motion to adopt Resolution No. 01-074,

made by Commissioner Battle, seconded by

18 Commissioner Nikolaisen. . . . . . . . . . . . 55

19 Roll call of Commissioners on

Resolution No. 01-074. . . . . . . . . . . . . 56

Public meeting adjourned . . . . . . . . . . . 57

1 P R O C E E D I N G S

2 COMMISSIONER SMITH: I guess we need to

3 call the meeting to order, so if everybody would have a

4 seat. If you want to join us, there are some extra seats

5 over here.

6 I'm Bob Smith and I'm the vice chairman of

7 the commission. I'm acting because the chairman has

8 retired and the Governor hasn't appointed a new one yet.

9 So I'm here and Muriel Battle is here with us and on the

10 telephone is Lynne Nikolaisen, three members of the

11 Commission. The fourth member of the Commission is

12 somewhere in the Himalayan Mountains, so we can't reach

13 him, but we do have a quorum and are prepared to go ahead.

14 I apologize, first, for having the meeting

15 start late, but we did take an extensive tour of the

16 facility and went through it in detail this morning before

17 we came here. I apologize for keeping you all waiting.

18 I do want to say, first, that I'm happy to

19 be here in Boonville, and it's the first time I've been in

20 your new City Hall, which I understand Mr. Kempf was

21 responsible for and always -- since I live in Columbia, we

22 get over here quite a bit, but we are very pleased to be

23 here and glad you made this available to us. With that

24 opening, I guess we need to call the roll.

25 ANGIE FRANKS: Commissioner Smith.

1 COMMISSIONER SMITH: Present.

2 ANGIE FRANKS: Commissioner Nikolaisen.

3 COMMISSIONER NIKOLAISEN: Present.

4 ANGIE FRANKS: Commissioner Battle.

5 COMMISSIONER BATTLE: Present.

6 ANGIE FRANKS: Commissioner Adorjan.

7 COMMISSIONER SMITH: All right. The roll

8 has been called. I guess we'll reconvene this open

9 session at this time, and I guess the primary

10 consideration is the suitability for the issuance of a

11 license to Isle of Capri.

12 I'll first call on our executive director,

13 Mr. Mullally, to give us the preliminary report.

14 KEVIN MULLALLY: Thank you, Mr. Chairman.

15 I'd also like to thank the City of Boonville, Mayor Kempf,

16 Tracy, for hosting us today, and I appreciate the

17 accommodations.

18 As we mentioned, the only item on the

19 agenda today is the consideration of suitability for

20 licensure for the Class A Licensee the Isle of Capri-

21 Boonville. I want to clarify that this is not the actual

22 licensing. This is the culmination of a lengthy

23 background investigation into the parent company's

24 activities in developing this site, all the principals

25 involved, and their financial suitability. And this will

1 simply be a finding that the company is suitable to hold

2 license. There are still some operational hurdles that we

3 need to get through before making a final determination on

4 licensure.

5 The order of the presentation this

6 morning: First, we will hear from the company, and then

7 we will hear from the City of Boonville. We will then

8 have the opportunity for any member of the public that

9 would like to offer any comments on this project or the

10 applicant. Then, finally, we will have a presentation

11 from the background investigation team regarding the

12 results of the background investigation.

13 So without objection, Mr. Chairman, I'll

14 call on Tom Campbell, representative for Isle of Capri-

15 Boonville, to make his company's presentation.

16 COMMISSIONER SMITH: Lynne, first, can you

17 hear us all right so far?

18 COMMISSIONER NIKOLAISEN: Yeah. I heard

19 Kevin just fine, so if Mr. Campbell gets in the same place

20 as Kevin, I should be able to hear him.

21 COMMISSIONER SMITH: Why don't you try

22 speaking there first and see if she can hear you, if not,

23 then you can move.

24 TOM CAMPBELL: Okay. Thank you,

25 Commissioners. Good morning, Director Mullally. My name

1 is Tom Campbell. I'm a partner with the St. Louis law

2 firm of Gallop, Johnson & Neuman, which serves as Missouri

3 regulatory counsel for the Isle of Capri Casinos, Inc. and

4 it's subsidiaries in Missouri, specifically,

5 IOC-Boonville.

6 COMMISSIONER SMITH: Before you go further,

7 Lynne, can you hear him all right?

8 COMMISSIONER NIKOLAISEN: I can hear him

9 just fine, thank you.

10 TOM CAMPBELL: Jack Gallaway, who is the

11 president and chief operating officer over the Isle of

12 Capri, flew in for the meeting and he's en route, so he

13 will be arriving later, and he will probably like to say a

14 few words. Along with him are a number of key executive

15 management officers of the corporation who wanted to be in

16 Boonville because of the interest they have in making sure

17 that this project, as they have with their other projects,

18 opens efficiently and without a problem and continues over

19 the years to be a good operation.

20 On my right is Tom Carr, who is regional

21 vice president for operations, and on my left is Jeff

22 King, who is vice president/general manager for the

23 IOC-Boonville development. They will each respectively

24 make a presentation. Tom will make his first on the

25 project as it is now evolving.

1 TOM CARR: I think I'm going to go over to

2 the podium. It would be easier. Good morning, again.

3 You have my welcome to Boonville. I'll suspect you'll

4 get welcomed to Boonville several times today because we

5 really are --

6 COMMISSIONER SMITH: I should mention that

7 Mr. Carr was our guide in going through the casino

8 facilities, so we appreciate you taking us through there.

9 TOM CARR: It's always a pleasure to show

10 off your new baby, so we were very pleased to be able to

11 do that this morning. Can she hear me all right?

12 COMMISSIONER NIKOLAISEN: Yes.

13 TOM CARR: Okay. Good. Thank you. We

14 have a relatively brief slide presentation that Jeff and I

15 are going to go through, but we wanted to reacquaint you

16 with a couple of things and talk about a few facts that I

17 hope will be useful to you this morning. Jeff, go ahead.

18 As an overview of the property, and clearly

19 you just walked it so you've seen most of this, but there

20 is a 28,000-square foot casino there contained on the

21 barge with 900 slot machines and 28 tables. Are we

22 actually opening with exactly 28, Jeff?

23 JEFF KING: Yes.

24 TOM CARR: Exactly 28, because at one time

25 I think we talked in the low thirties, but we are going to

1 have 28 tables, which you saw this morning.

2 Off the barge, there's 25,000 square feet

3 of public space. We have our Calypsos Buffet. These are

4 signature restaurants within the Isle of Capri, so if you

5 go to an Isle of Capri, you will see similarly named

6 restaurants. The buffet has 275 seats. We have a

7 Farraddays' Restaurant, which has 75 seats, which is our

8 fine dining restaurant that is used by our best customers.

9 We have a Tradewinds Marketplace, which is a fast food.

10 It's certainly more than a snack bar, but it offers a

11 variety on the menu. It offers people a quick and

12 relatively inexpensive place to get a meal. Then we have

13 a retail area, a gift shop, if you will. And we have an

14 upstairs area that is kind of a multipurpose room that we

15 will be able to have parties and break-out rooms. The

16 kind of thing that has a lot of flexibility to offer

17 events for the property as well as for the community.

18 And there will be a historic display area

19 on the property. I don't know whether it was pointed out

20 when you walked in the front door as to where it's going

21 to be, but as you enter the property, there's going to be

22 an area that will display historical items from the

23 Boonville community. That is being put together by a lady

24 named Judy Shields, if I've got her name right, who is

25 involved with the local historical society. She's putting

1 together a collage, montage if you will, of artifacts for

2 the area that will be displayed there. In addition to

3 that display, there is going to be a mural that is going

4 to be hung in the entrance to the left as you go in. That

5 is being done and it is done specifically for Boonville

6 and is about Boonville. And I think we're going to have a

7 lot of fun in showing it off in the area.

8 The other thing that is historic on the

9 property is the Katy Trail. We've had our issues in

10 getting the Katy Trail accomplished here, and I'll show

11 you how it moves through the property, but running on the

12 east side of the property, south and kind of east of the

13 property, is the Katy Trail. And I'll show you in a

14 minute where that goes.

15 The other thing I wanted to mention is we

16 have designed this project to put a hotel in, and I'm

17 looking forward to -- when it opens as successfully as I

18 know it will, I'm looking forward to going into our board

19 and getting the money to put a hotel here. And if Jack

20 was here, and he is here.

21 JACK GALLAWAY: I think I came in a few

22 minutes early.

23 TOM CARR: I will put the arm on Jack

24 fairly soon. We've designed it in the project so we can

25 do it in a way that really doesn't disrupt the business,

1 but we think it will be a good addition.

2 Go ahead, Jeff. That's the site plan.

3 You've obviously just walked it. That site plan is early

4 in April of -- March of 2001, I believe. You'll see the

5 Katy Trail, if you look at that site plan, in the upper

6 right-hand corner. You can see how the Katy Trail enters

7 near Main Street and proceeds through the site. That is

8 an old -- that was where it was initially going to be

9 placed, and I'll show you on the next slide where it is

10 today. But other than that, the placement of the Katy

11 Trail, everything on there is as we had contemplated, and

12 you will see marked as -- is it "C" Jeff?

13 JEFF KING: Yes, "C."

14 TOM CARR: That's the site of the future

15 hotel. It's back -- it will actually be out where the

16 loading dock area is, and we've planned it in such a way

17 that we can build that as soon as it makes sense for us to

18 do that.

19 Go ahead to the next one, Jeff. This shows

20 where the Katy Trail is actually located today. On the

21 far right of that it enters near Main Street, comes along

22 the south side of the project, and then moves east back

23 towards -- ultimately ends up, I guess, at Water Street.

24 So the Katy Trail moves through that site, and we expect

25 that that will have quite a bit of use. So that's the

1 site as it lays out.

2 Go ahead, Jeff. Now, we wanted to give you

3 a little bit of a historical perspective in the sense of

4 showing you kind of what was there. Most of you saw that,

5 I didn't. I didn't join the project until late 2000. Go

6 ahead, Jeff, and kind of flip through that. It's a little

7 bit dark and a little bit hard to see, but that's the site

8 as it was as development was contemplated. That was a

9 road that was there. Go ahead, Jeff. This is the

10 railroad track looking back towards the bridge, and this

11 is looking up Second Street, all of which has been

12 substantially improved today.

13 Go ahead, Jeff. Then, as you can see, the

14 superstructure begins to come out of the ground. Mother

15 Nature was not completely our friend last year as we went

16 through a tough winter here, but in spite of all of that,

17 we really have all been pretty well on time. There is the

18 superstructure, more of the superstructure.

19 Go ahead, Jeff. Obviously, it begins to

20 take shape. And then the first look at kind of the

21 interior, which you saw in a pretty well-finished way

22 today, use of the neon color, the openness. Go ahead,

23 Jeff. The exterior shot. That's now -- we were pleased

24 to see today that we got the logo up on the side of the

25 paddle wheel. At night, I haven't been here yet to see it

1 at night, looking forward to doing that this weekend, but