356213--3/16/2006--PINNACLE_ENTERTAINMENT

related topics

{competitive, industry, competition}

{cost, contract, operation}

{operation, natural, condition}

{condition, economic, financial}

{debt, indebtedness, cash}

{regulation, government, change}

{loan, real, estate}

{capital, credit, financial}

{acquisition, growth, future}

{personnel, key, retain}

{stock, price, operating}

{financial, litigation, operation}

{regulation, change, law}

Our pending acquisition of Aztar presents many risks, and we may not realize the financial and strategic goals that were contemplated at the time of the transaction. The gaming industry is very competitive and increased competition, including by Native American gaming facilities, could adversely affect our profitability. Our pending acquisitions and substantial development obligations in connection with the St. Louis projects and other capital-intensive projects could strain our financial resources and might not provide for a sufficient return, if any. Many factors could prevent us from completing our construction and development projects as planned, including the escalation of construction costs beyond increments anticipated in our construction budgets. Our present indebtedness and projected future borrowings could have adverse consequences to us; future cash flows may not be sufficient to meet our obligations and we might have difficulty obtaining additional financing; we may experience adverse effects due to interest rate and exchange rate fluctuations. The terms of our credit facility and the indentures governing our subordinated indebtedness impose operating and financial restrictions on us. Issues could arise with respect to our insurance policies that could affect our timely recovery of insurance proceeds associated with recent hurricane damage and related business interruption. Because of the closure of Casino Magic Biloxi, we have suffered a loss of operating revenues from that facility; changes in the local gaming market could adversely affect our operations in Biloxi if we decide to build a replacement facility. Damage and closures caused by Hurricanes Katrina and Rita in the New Orleans and Lake Charles areas make our future operating results at Boomtown New Orleans and L Auberge du Lac less predictable. We operate in a highly taxed industry and may be subject to higher taxes in the future. We could lose the right to pursue the projects in downtown St. Louis and St. Louis County if we fail to meet the conditions imposed by the Missouri Gaming Commission. Our industry is highly regulated, which makes us dependent on obtaining and maintaining gaming licenses and subjects us to potentially significant fines and penalties. Potential changes in the regulatory environment could harm our business. The concentration and evolution of the slot machine manufacturing industry could impose additional costs on us. Adverse weather conditions, highway construction, gasoline shortages, and other factors affecting our facilities and the areas in which we operate could make it more difficult for potential customers to travel to our properties and deter customers from visiting our properties. Our results of operations and financial condition could be materially adversely affected by the occurrence of natural disasters, such as hurricanes, or other catastrophic events, including war and terrorism. The loss of management and other key personnel could significantly harm our business. We experience seasonal fluctuations that significantly impact our quarterly operating results. We are subject to litigation which, if adversely determined, could cause us to incur substantial losses. We face environmental and archaeological regulation of our real estate. Economic and political conditions, including slowdowns in the economy, and other factors affecting discretionary consumer spending may harm our operating results.

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356213--3/16/2006--PINNACLE_ENTERTAINMENT_INC