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Lakes Entertainment Announces Status Update Former Development Project

  Lakes Entertainment Announces Status Update Former Development Project

Business Wire

MINNEAPOLIS -- January 16, 2014

Lakes Entertainment, Inc. (NASDAQ: LACO) announced that Penn National Gaming,
Inc. (“Penn”) recently reported that the Jamul Indian Village of California
(“Jamul”) and a wholly owned subsidiary of Penn announced the launch of
construction activities at the site of the proposed $360 million Hollywood
Casino Jamul on Jamul’s reservation in Jamul, California. Penn further
reported that the Hollywood Casino Jamul, projected to open in late 2015, is
expected to include a three-story gaming and entertainment facility of
approximately 200,000 square feet, featuring over 1,700 slot machines, 50 live
table games including poker, multiple restaurants, bars and lounges and an
enclosed below grade parking structure with over 1,900 spaces

Jamul currently owes Lakes $60 million related to loans made by Lakes to Jamul
in prior years under agreements for a potential casino development. Pursuant
to a subordination agreement that Lakes entered into with Penn and Jamul,
interest on such debt will accrue at 4.25% after the Hollywood Casino Jamul
opens. Lakes agreed that it will subordinate repayment of such debt until the
senior financing is paid in full, but that current interest on the
subordinated debt will be paid to Lakes on a quarterly basis when the
Hollywood Jamul Casino opens so long as there is no default under the senior
financing agreement. When the senior financing is paid in full, Lakes will
receive repayment of its outstanding principal and interest. During 2012,
Lakes entered into ten-year option agreement with Penn that grants Penn the
right to purchase approximately 98 acres of land which Lakes owns adjacent to
Jamul’s reservation land. The purchase price for the land is $7 million which
increases annually by 1%.

Tim Cope, President and Chief Financial Officer of Lakes, stated, “It is
encouraging to read Penn Gaming is planning to start their initial development
activities on the Jamul Tribe’s casino. We continue to be supportive of the
Tribe’s effort to achieve their long-term dream. Any future recovery of
amounts due to us from the Tribe will positively impact our financial position
since these amounts are not currently reflected on our books.”

About Lakes Entertainment

Lakes Entertainment, Inc. currently owns the Rocky Gap Casino Resort near
Cumberland, Maryland. Lakes has an investment in Rock Ohio Ventures, LLC’s
casino and racino developments in Ohio, and an investment in Dania
Entertainment Center, LLC’s Dania Jai Alai fronton in Dania Beach, Florida.

The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for forward-looking statements. Certain information included in this press
release (as well as information included in oral statements or other written
statements made or to be made by Lakes Entertainment, Inc.) contains
statements that are forward-looking, such as statements relating to plans for
future expansion and other business development activities as well as other
capital spending, financing sources and the effects of regulation (including
gaming and tax regulation) and competition. Such forward-looking information
involves important risks and uncertainties that could significantly affect
anticipated results in the future and, accordingly, such results may differ
from those expressed in any forward-looking statements made by or on behalf of
the company. These risks and uncertainties include, but are not limited to,
those relating to the inability to complete or possible delays in completion
of Lakes' casino projects, including various regulatory approvals and numerous
other conditions which must be satisfied before completion of these projects;
possible termination or adverse modification of management or development
contracts; Lakes operates in a highly competitive industry; possible changes
in regulations; reliance on continued positive relationships with Indian
tribes and repayment of amounts owed to Lakes by Indian tribes; risks of entry
into new businesses; reliance on Lakes' management and litigation costs. For
more information, review the company's filings with the Securities and
Exchange Commission.

Contact:

Investor Relations Contact:
BPC Financial Marketing
John Baldissera, 800-368-1217
or
For Further Information Contact:
Lakes Entertainment, Inc.
Timothy Cope, 952-449-7030
 
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