Kansas entertainment llc__8.13.08_

2

Overview

•  BestTeam

•  BestProject•  BestBrands•  BestFinancialReturnforKansas

3

OwnershipStructure

KansasEntertainment,LLC

Gaming/HotelOpera?ons:

DennisGomes

Development,Retail&EntertainmentOpera?ons:

JoeWeinberg

Event/RaceOpera?ons:

JeffBoerger

CordishCompanyEnDty:

KansasEntertainmentInvestors,LLC

JoeWeinberg,President

ISCEnDty:

KansasSpeedwayDevelopmentCorp.

JeffBoerger,President

50% 50%

4

BestPartnerforState&LocalGovernment

LonghistoryofworkingproducDvelywithboththeUnifiedGovernment&theState

5

BestPartnerforState&LocalGovernment

PartnershipwiththeKansasLoReryhasshownoutstandingreturnsforKansas 6

ISCHasNa?onalReach

7

8

PowerofISCVideo

TheCordishCompany

PrivatelyHeldforFourGeneraDons9

LongTermVision 10

TheCordishCompany

DiversePor\olio&Developments 11

TheCordishCompany

TheCordishCompany

ExtensiveDevelopmentReach&Assets12

Cordish+ISC+HardRock

TremendousCombinedStrength 13

Cordish+ISC+HardRock

14

TheCordishCompany

DesDnaDonGamingDevelopment15TheimageaboveandthoseusedonsubsequentpagesareofHardRockHotelandCasinos

thatweredevelopedbyaCordishCompanyaffiliatefortheSeminoleTribeofFlorida

UpscaleHotels 16

TheCordishCompany

StateoftheArtCasinos17

TheCordishCompany

DesDnaDonResortAmeniDes 18

TheCordishCompany

PowerfulEntertainmentDistrict19

TheCordishCompany

FullIntegraDonDrivesVisitaDon20

TheCordishCompany

Non‐gamingdesDnaDonentertainmentsignificantlyincreasesgamingrevenues 21

TheCordishCompany

ShortestPaybackofAnyMajorCasinos22

TheCordishCompany

0

2

4

6

8

10

12

FloridaHardRockHotel&Casinos

Mirage MoheganSun

Borgota Paris Bellagio TajMahal BeauRivage

Mandalay

(yearsto

payba

ck)

Source:SeminoleTribeofFlorida

SuperiorFinancialResults1Source:SeminoleTribeofFlorida2Source:ThomasWeiselPartnersLLCResearchReport3Source:GoldmanSachsGlobalInvestmentResearch

(4)Source:MoheganTribalGamingAuthority,SECFiling,10‐KFiling,NOTE:OperaDngIncomeshownforFY2007endedSept.30,200723

TheCordishCompany

$0

$100

$200

$300

$400

$500

$600

$700

$800

FloridaHardRocks(1)

PennNatl(3) Wynn(2) Boyd(2) LasVegasSands(2)

Ameristar(2) MoheganGaming(4)

PinnacleEnter.(2)

2007Opera?ngIncome

CordishHardRockFloridaVideo

24

25

TheCordishCompany

26

TheCordishCompany

TheWalk–AtlanDcCity,NJ

27

TheCordishCompany

CordishProjectsChangeCommuniDes28

TheCordishCompany

CommunityInvolvement29

TheCordishCompany

WorldClassDesignTeam

REPRESENTATIVEPROJECTS

Developer: TheCordishCompany SeminoleHardRockHotel&CasinoHollywood&Tampa;IndianaLive!

LeadArchitect: KlaiJubaArchitects MandalayBay;“W”LasVegas;HardRockLasVegas;FourSeasonLasVegas

InteriorDesigners: CleoDesign MGMCasinoLasVegas;MGMCasinoDetroit;BeauRivageBiloxi;HiltonLasVegas

LaurenceLeeAssociates

BorgataAtlanDcCity;HardRockHollywood&Tampa;KapaluaBayHawaii

Engineer: Burns&McDonnell SprintCenterKansasCity;TrumanSportsComplexKansasCity

30

TheCordishCompany

Management

•  DennisGomes–  34YearsGamingExperience–  LicensedinNevada&NewJersey–  BackgroundIncludes:

•  President&CEO,ResortOperaDons‐TropicanaHotels&Casinos,LasVegas,NV&AtlanGcCity,NJ(AztarCorp.)

•  President&COO–TrumpTajMajal

•  President&COO–GoldenNuggetHotel&Casino•  Sr.VicePresident,CasinoOperaDons–HiltonHotels&Casinos,LasVegas,NV

31

Management

DennisGomes

CEO

Gaming/HotelOpera?ons

RobertZiRo

EVP

Food&Beverage

SherryAmos

EVP

Marke?ng

AaronGomes

VP

Marke?ng

RobertAmbrose

EVP

SlotOpera?ons

PeterIng

VP

SlotOpera?ons

DonKneisel

EVP

I.T.

DavidGenDle

EVP

Administra?on

JeanPrice

Director

Administra?on

LatoruaChinn

Manager

DiversityCompliance

FredBurford

EVP

Finance

ShawnMcCloud

VP

Finance

32

Management

YEARSOFGAMINGEXPERIENCE

SherryAmos ExecuDveV.P.‐MarkeDng 24

RobertAmbrose V.P.‐SlotOperaDons 20

FredBurford ExecuDveV.P.‐Finance 25

DavidA.GenDle V.P.‐AdministraDon 24yearswithFBI

PeterIng V.P.–SlotOperaDons 12

DonaldW.Kneisel,II V.P.‐Info.Technology 24

AaronGomes V.P.‐OperaDons 3

ShawnK.McCloud V.P.‐StrategicPlanning 15

JeanPricePreikszaiDs DirectorofCorp.Admin. 28

RobertZiRo ExecuDveV.P.‐Food&Bev. 28

33

GamingComplianceExper?se

OperaDonsteamhasdecadesofexperiencerunningvenuesinthemostdemandinggamingmarkets

34

35

GamingComplianceExper?se

•  MulDplemembersoftheteamhavehadsignificantexperienceingamingregulaDonandlawenforcement•  NevadaGamingControlBoard

•  NewJerseyDivisionofGamingEnforcement

•  FBI

Security&Surveillance,InternalControls&InformaDonTechnologyPlansarefullydeveloped

andhavebeensubmiRed 36

GamingComplianceExper?se

CommitmenttoDiversity

KansasSpeedwayandCordishmeetorexceedMBE/WBE/LBEGoals

0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00%

4thStreetLive!

CapitalCenter‐PhaseI

CapitalCenter‐PhaseII

Pier4OfficeBuilding

KansasCityLive!ProfessionalServices

KansasCityLive!Construc?onServices

PowerPlant

KansasSpeedway‐ProfessionalServices

KansasSpeedway‐Construc?onServices

KansasSpeedway‐Materials/Supplies

Goal Performance

37

CommunityVideo

38

Overview

•  BestTeam

•  BestProject•  BestBrands•  BestFinancialReturnforKansas

39

40

BestLoca?on

OnlylocaDonwitheasyaccessandvisibilitytobothI‐70andI‐435 41

BestLoca?on

OnlySiteWithInfrastructureInPlace42

IntegratedDesign

• IntelligentMasterplanning • IntegraDonwithKansasSpeedway

43• UnmatchedAbilitytoExpand

LuxuryDes?na?onResort

300RoomLuxuryHotelwith50Suites

44

HighEnergyCasino

3,000Slots&140TablesatOpeningWithRoomforExpansion45

IntegratedDesign

•  275,000SquareFeetDesDnaDonRetail,Dining&Entertainment•  LiveMusicVenue

46

• 1.5millionsquarefeet • Undergroundstructuredparking47

IntegratedDesign

• Cross‐CurrentofPedestrianTraffic

IntegratedDesign

DesDnaDonpool,fitnesscenter&spaoverlookingspeedway

48

HighEnergyCasino

49

HighEnergyCasino

50

ModernLuxuryDesign

51

IntegratedDesign

Live!DistrictDrivesTourism&GamingRevenue

52

IntegratedDesign

ExtensiveMeeDng&ConvenDonFaciliDes

53

CommunityShugleSystem

54

TemporaryCasino

55

• OpenInEightMonths

•  $209MillionAnnualRevenue

•  2000slots

•  75tablegames

56

TemporaryCasino

ExpansionCapabili?es

Hotel/Casino

Expansion

CasinoExpansion

57

Schedule

58

World‐ClassDes?na?on

59

Overview

•  BestTeam

•  BestProject•  BestBrands•  BestFinancialReturnforKansas

60

GlobalBrandPresence

61

UnparalleledBrandRecogni?on

85%

NaDonalfamiliaritywithHardRockBrand

62Source:ZogbyInternaGonalResearch

HardRockDrivesTourism

76%

NaDonalVisitorstoHardRockProperDesFromOutofState

63Source:ZogbyInternaGonalResearch

FamiliarityWithHardRockBrand

0

10

20

30

40

50

Hard Rock Mohegan Sun Pinnacle Golden

51

22

0 3

36

4 4 3

33

6 3 3

(percent)

National Kansas Statewide KC DMA

Hard Rock Is Exponentially Stronger Than Other Options:

•  2.5 – 50 Times Better Nationally

•  8 – 12 Times Better Statewide

•  5.5 – 11 Times Better in KC

64Source:ZogbyInternaGonalResearch

RegionalTargetMarkets

65

BrandStrength=Visits

66Source:ZogbyInternaGonalResearch

0

5

10

15

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30

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45

50

HardRock LegendsSun Pinnacle Golden

42

21

3 3

47

27

20 22

KansasStatewide KCDMA

Statewideinterestinvisi?ngaHardRockisatleastdoublethatofanyotherpossiblecasino.

HardRockPreferenceIsClear

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20

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60

70

80

HardRock LegendsSun Pinnacle Golden

35

11 8

8

71

40 43

46

(percent)

Kansas Statewide KC DMA

Amongthosewhosaytheyare“VeryInterested”invisi?ngacasinointhefuture,moresaytheyareveryinterestedinvisi?ngHardRockoverotherpossiblecasinobrands.

67Source:ZogbyInternaGonalResearch

AffluentCustomersLoveHardRock

0

10

20

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40

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60

Hard Rock Legends Sun Pinnacle Golden

58

9 10

8

54

30 28 29

(per

cent

)

Kansas Statewide KC DMA

Those making more than $75,000 a year say they are more likely to visit the Hard Rock than any other brands. Hard Rock scores much better as a regional destination than other brands.

68Source:ZogbyInternaGonalResearch

UnparalleledRela?onshipsWithCorporateLeaders

69

EachTracksideBillboardGets$880,000inTVExposureAnnually

70Source:JoyceJuliusandAssociatesSponsorsReport

OnlyWeCanGuaranteeKansasNa?onalExposureEachYear

71

ByProvidingTwoTracksideBillboardsDevotedtoTourism

72

$1.76MillionofTelevisionExposureForKansasTourismEachYear

73

CorporateDecisionsMakersVisitKansasSpeedway

•  Therewereover550companiesinvolvedassponsorsinNASCARlastyear

•  OurteamisuniquelyposiDonedtoleverageeventsattheSpeedwaytobringconvenDonbusinesstoKCK

•  Decision‐makingexecuDvesspendtheirenDredayonSpeedwayproperty

74

RacingFansLikeCasinos

•  57.5%ofKansasSpeedwayfansvisitedacasinointhepast12months

•  Ourfansare27%morelikelythantheaveragepersoninKansasCitytovisitacasino

•  FansoftheIndyRacingLeagueare85%morelikelytovisitacasino

75Source: Scarborough Research 2007

GeneralMarke?ngStrategy

•  Cross‐marketwithSpeedway&tenants

•  CreateuniqueVIPexperiencesforbestcustomers

•  UseRewardsProgramandCRMtomaximizecustomervalue

•  LeverageHardRockbrandstrengthandracingeventsinmarkeDngthattargetstourists

76

Overview

•  BestTeam

•  BestProject•  BestBrands•  BestFinancialReturnforKansas

77

BestOverallReturn

GrossGamingRevenues(millions)

0 100 200 300 400 500 600

27% 30% 33%

78

AddiDonal1%VoluntaryFee

toUnifiedGovernment

FeePercentagetoPublicSector

BestTotalFinancialPackage

$75,000,000

$80,000,000

$85,000,000

$90,000,000

$95,000,000

$100,000,000

$105,000,000

$110,000,000

$115,000,000

HardRock Golden Pinnacle LegendsSun

FeestoKansas FeestoProblemGaming FeestoLocalGovernment

$113M $111M

$108M $108M

(Assumes$400milliongrossgamingrevenue) 79

(Assumes$500milliongrossgamingrevenue)

$135.75M$137M

$142.5M

$147M

80

BestTotalFinancialPackage

$105,000,000

$110,000,000

$115,000,000

$120,000,000

$125,000,000

$130,000,000

$135,000,000

$140,000,000

$145,000,000

$150,000,000

HardRock Golden Pinnacle LegendsSun

FeestoKansas FeestoProblemGaming FeestoLocalGovernment

GamingRevenueForecast

$300

$310

$320

$330

$340

$350

$360

$370

$380

$390

Year1 Year2 Year3 Year4 Year5

(Millions)

Slotmachines PitRevenue Poker&cardgames

$349.3M

$376.2M

$358M$367M

$385.6M

81(Assumes3,000slotmachinesand140tablegames)

Non‐GamingRevenueForecast

82

$0

$10

$20

$30

$40

$50

$60

$70

$80

Year1 Year2 Year3 Year4 Year5

(millions)

Hotel Food Beverage Conven?on Entertainmnent Retail Other

$67.7M $69.9M $74.2M$72M

$65.4M

ResidentVisita?on

83

‐

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

Year1 Year2 Year3 Year4 Year5

TotalGamingVisitsPerYear TotalNon‐GamingVisitsPerYear

ResidentEconomicImpact

84

$275

$285

$295

$305

$315

$325

$335

$345

$355

$365

Year1 Year2 Year3 Year4 Year5

(millions)

GamingSpendPerYear Non‐GamingSpendPerYr.

TouristVisita?on

85

‐

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

Year1 Year2 Year3 Year4 Year5

TotalGamingVisitsPerYear TotalNon‐GamingVisitsPerYr.

TouristEconomicImpact

86

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

Year1 Year2 Year3 Year4 Year5

(millions)

GamingSpendPerYear Non‐GamingSpendPerYr.

PublicSectorSummary

87

$0

$20

$40

$60

$80

$100

$120

$140

Year1 Year2 Year3 Year4 Year5

(millions)

StateRevenue PropertyTaxes Sales&UseTax

KeynotesofFinancingPlan

•  OwnersofKansasEntertainmenthavesignificantliquidityandfinancingcapabiliDesin‐house

•  Ownershaveimpeccabletrackrecordswithfinancingcommunityoverseveraldecades

•  MulDplethird‐partysourcesindicatedhighconfidenceindebtfinancingforourproject

88

FinancingPlan:Sources

89

$90

$333

$141

$141

DelayedDrawTermLoan TermLoan(s) CordishEquity/Cash ISCEquity/Cash

(millions)

FinancingPlan:Uses

90

$415

$105

$32

$25

$9 $25

$15$80

HardCosts SopCosts Con?ngencyFinancingCosts&Fees Pre‐OpeningOpera?ons LicensingFeeCageCash&WorkingCapital Pre‐FundedInterestReserve

(millions)

FinalVideo

92

93

IfWeBuildIt,TheyWillCome...TwiceEachYear

94

AndBringAnother$111MillioninAnnualEconomicImpactWithThem

Source:TheWashingtonEconomicsGroup,Inc.

95

AppendixASummary

96

• FeePercentageProposaltoState:–  27%totaltaxonfirst$350mmofAnnualGrossGamingRevenue

–  30%totaltaxonGGRbetween$350mmand$400mm

–  33%totaltaxonGGRabove$400mm

• HighestCharitableContribuDons:

– AddiDonal1%ofGGRtoUnifiedGovernmentbeyondstatutoryminimum

AppendixBProposedFeesComparison

97

AppendixCGamingRevenueProjecDon

98

All figures in $000’s

•  Gaming revenue forecasts based on detailed market assessment by Innovation Group, the market leader in gaming market analyses.

•  Based on 3,000 slot machines and 140 table games. •  Kansas Entertainment, LLC believes 3,000 machines is correct

and realistic initial number. This is also consistent with finding of Christiansen Capital Advisors, advisors to State.

•  Slot machine capacity would be increased if validated by market demand.

AppendixDNon‐GamingRevenueProjecDon

99

All figures in $000’s

AppendixEEconomicImpact–ResidentsVisitaDon

100

AppendixFEconomicImpact–TouristVisitaDon

101

AppendixGSummaryFinancialProjecDons

102

AppendixHReturnstoPublicSector

103

AppendixIFinancingPlan:Sources&Uses

104