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<SEC-DOCUMENT>0000950137-07-001075.txt : 20070129
<SEC-HEADER>0000950137-07-001075.hdr.sgml : 20070129
<ACCEPTANCE-DATETIME>20070129161508
ACCESSION NUMBER:		0000950137-07-001075
CONFORMED SUBMISSION TYPE:	S-3/A
PUBLIC DOCUMENT COUNT:		3
FILED AS OF DATE:		20070129
DATE AS OF CHANGE:		20070129

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LAKES ENTERTAINMENT INC
		CENTRAL INDEX KEY:			0001071255
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990]
		IRS NUMBER:				411913991
		STATE OF INCORPORATION:			MN
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		S-3/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-139783
		FILM NUMBER:		07561224

	BUSINESS ADDRESS:	
		STREET 1:		130 CHESHIERE LANE
		CITY:			MINNETONKA
		STATE:			MN
		ZIP:			55305
		BUSINESS PHONE:		6124499092

	MAIL ADDRESS:	
		STREET 1:		130 CHESHIRE LANE
		CITY:			MINNETONKA
		STATE:			MN
		ZIP:			55305

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LAKES GAMING INC
		DATE OF NAME CHANGE:	19980929
</SEC-HEADER>
<DOCUMENT>
<TYPE>S-3/A
<SEQUENCE>1
<FILENAME>c10767a1sv3za.htm
<DESCRIPTION>AMENDMENT TO REGISTRATION STATEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>sv3za</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>As filed with the Securities and Exchange Commission on January&nbsp;29, 2007</B>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Registration No.&nbsp;333-139783</B>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>




<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>WASHINGTON, D.C. 20549</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>AMENDMENT NO. 1 TO</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 1pt"><B>FORM S-3</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 1pt"><B>REGISTRATION STATEMENT<BR>
Under the<BR>
Securities Act of 1933</B>
</DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>LAKES ENTERTAINMENT, Inc.</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>(Exact name of registrant as specified in its charter)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Minnesota<BR>
(State or other jurisdiction <BR>
of incorporation or organization)</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>41-1913991<BR>
(I.R.S. Employer<BR>
Identification No.)</B></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>130 Cheshire Lane, Suite&nbsp;101<BR>
Minnetonka, MN 55305<BR>
(952)&nbsp;449-9092<BR>
(Address, including zip code, and telephone number, including area code, of registrant&#146;s principal executive offices)</B></DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Lyle Berman<BR>
Chief Executive Officer<BR>
Lakes Entertainment, Inc.<BR>
130 Cheshire Lane, Suite&nbsp;101<BR>
Minnetonka, MN 55305<BR>
(952)&nbsp;449-9092</B></DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>(Name, address, including zip code, and telephone number, including area code, of agent for service)</B></DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B><I>Copies of all communications, including communications sent to agent for service, should be sent to:</I></B></DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom" style="font-size: 1pt">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Jean M. Davis, Esq. <BR>
Daniel R. Tenenbaum, Esq. <BR>
Gray Plant Mooty <BR>
500 IDS Center <BR>
80 South Eighth Street <BR>
Minneapolis, MN 55402<BR>
Telephone: (612)&nbsp;632-3000<BR>
Telecopy: (612)&nbsp;632-4444</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>Eleazer Klein, Esq.<BR>
Schulte Roth &#038; Zabel LLP<BR>
919 Third Avenue<BR>
New York, NY 10022<BR>
Telephone: (212)&nbsp;756-2000<BR>
Telecopy: (212)&nbsp;593-5955</B></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Approximate date of commencement of proposed sale to the public: </B>As soon as practicable after this
Registration Statement becomes effective.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If the only securities being registered on this form are being offered pursuant to dividend or
interest reinvestment plans, please check the following box. <FONT face="Wingdings">&#111;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If any of the securities being registered on this form are to be offered on a delayed or continuous
basis pursuant to Rule&nbsp;415 under the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the following<BR>
 box. <FONT face="Wingdings">&#254;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If this form is filed to register additional securities for an offering pursuant to Rule 462(b)
under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. <FONT face="Wingdings">&#111;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act,
check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. <FONT face="Wingdings">&#111;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective
amendment thereto that shall become effective upon filing with the Commission pursuant to Rule
462(e) under the Securities Act, check the following box. <FONT face="Wingdings">&#111;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If this Form is a post-effective amendment to a registration statement filed pursuant to General
Instruction I.D. filed to register additional securities or additional classes of securities
pursuant to Rule 413(b) under the Securities Act, check the following box. <FONT face="Wingdings">&#111;</FONT>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CALCULATION OF REGISTRATION FEE</B>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="41%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD><!-- VRule -->
    <TD width="1%">&nbsp;</TD>
    <TD width="16%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD><!-- VRule -->
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD><!-- VRule -->
    <TD width="1%">&nbsp;</TD>
    <TD width="14%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD><!-- VRule -->
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">

<TD nowrap align="left" colspan="15" style="border-bottom: 3px double #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
<TD width="1%" style="border-left: 0px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Proposed</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Proposed</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD width="1%" style="border-right: 0px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
<TD width="1%" style="border-left: 0px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Maximum</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Maximum</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Amount of</B></TD>
    <TD width="1%" style="border-right: 0px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
<TD width="1%" style="border-left: 0px solid #000000">&nbsp;</TD>

    <TD nowrap align="center"><B>Title of Each Class of</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Amount to be</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Offering Price</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Aggregate Offering</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Registration</B></TD>
    <TD width="1%" style="border-right: 0px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
<TD width="1%" style="border-left: 0px solid #000000">&nbsp;</TD>

    <TD nowrap align="center"><B>Securities to be Registered</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Registered (1)</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Per Share (2)</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Price (1)(2)</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Fee</B></TD>
    <TD width="1%" style="border-right: 0px solid #000000">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">

<TD width="1%" style="border-left: 0px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
                    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:15px; text-indent:-15px">Common stock, par value $0.01
per share</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">1,625,000(3)</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">$10.785</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">$17,525,625</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">$1,875(4)</TD>

<TD width="1%" style="border-right: 0px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="15" style="border-top: 3px double #000000">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Pursuant to Rule&nbsp;416, there are also registered such indeterminate number of additional shares of common stock as may be issued by reason of any stock dividend, stock
split or other similar transactions effected without receipt of consideration that results in an increase in the number of outstanding shares of common stock.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Estimated solely for the purpose of determining the registration fee in accordance with Rule 457(c) under the Securities Act of 1933. The maximum price per share
information is based on the average of the high and the low sale price on December&nbsp;27, 2006, as reported on The Nasdaq Global Market, which was a date within five
business days prior to the date of filing the initial Form S-3 registration statement.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Includes the number of shares of common stock issuable to the selling shareholder upon either the (i)&nbsp;conversion of outstanding shares of series A convertible preferred
stock or (ii)&nbsp;exercise of outstanding warrants. Under the terms of a registration rights agreement between the registrant and the selling shareholder identified in
this registration statement, the registrant is required to register 130% of the shares of common stock
 issuable upon the exercise of the warrants currently exercisable
to purchase up to an aggregate of 1,250,000 shares.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Paid with the filing of the initial Form S-3 registration statement.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>The registrant hereby amends this registration statement on such date or dates as may be necessary
to delay its effective date until the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become effective in accordance with
Section&nbsp;8(a) of the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities and Exchange Commission, acting pursuant to said Section
8(a), may determine.</B>
</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>


<DIV style="font-family: 'Times New Roman',Times,serif">







<DIV align="left" style="font-size: 11pt; margin-top: 6pt">The information in this prospectus is not complete and may be changed. We may not sell these
securities, pursuant to this prospectus, until the registration statement filed with the Securities
and Exchange Commission is effective. This prospectus is not an offer to sell these securities and
it is not soliciting an offer to buy these securities in any state where the offer or sale is not
permitted.
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SUBJECT TO COMPLETION, DATED JANUARY 29, 2007.</B>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>PROSPECTUS</B>
</DIV>


<DIV align="center" style="font-size: 18pt; margin-top: 18pt"><B>LAKES ENTERTAINMENT, INC.</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>

<DIV align="Center" style="font-size: 12pt; margin-top: 6pt">1,625,000 Shares of Common Stock<BR>
<BR>
<DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>

<DIV align="left" style="font-size: 9pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus relates to the resale of up to 1,625,000 shares of our common stock that we
may issue to the selling shareholder. The shares of common stock offered under this prospectus by
the selling shareholder are issuable upon either (i)&nbsp;the conversion of outstanding shares of our
series A convertible preferred stock, referred to as preferred stock, or (ii)&nbsp;the exercise of
outstanding common stock purchase warrants, referred to as warrants. We will not receive any
proceeds from the offer and sale of the shares. Rather, the selling shareholder will receive all
of the net proceeds from any sale of the shares. However, as described in greater detail in this
prospectus under the section &#147;Use of Proceeds&#148;, we may receive the proceeds from the exercise of
the warrants issued to the selling shareholder. We have been advised that the selling shareholder
may from time to time sell the common stock to or through brokers or dealers in one or more
transactions, in The Nasdaq Global Market or otherwise, at market prices prevailing at the time of
sale, at prices relating to prevailing prices, or at negotiated prices.
</DIV>

<DIV align="left" style="font-size: 9pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock is listed on The Nasdaq Global Market under the symbol &#147;LACO.&#148; On
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, 2007, the closing sales price of our common stock as reported by The Nasdaq Global
Market was $&#091;&#95;&#95;&#95;&#093;.
</DIV>

<DIV align="center" style="font-size: 9pt; margin-top: 18pt"><B>Investing in our common stock involves a high degree of risk.<BR>
See &#147;</B><U><B>Risk factors</B></U><B>&#148; beginning on page 7 of this Prospectus.</B>
</DIV>


<DIV align="left" style="font-size: 9pt; margin-top: 6pt"><B>Neither the Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined if this prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>The date of this Prospectus is </B><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><B>, 2007</B>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<!-- TOC -->
</DIV>
<DIV align="left">
<A name="tocpage"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>TABLE OF CONTENTS</B>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#101"><B>SUMMARY</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>1</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#102"><B>RISK FACTORS</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>7</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#103"><B>CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>16</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#104"><B>USE OF PROCEEDS</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>17</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#105"><B>SELLING SHAREHOLDER</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>18</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#106"><B>DESCRIPTION OF CAPITAL STOCK</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>19</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#107"><B>PLAN OF DISTRIBUTION</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>23</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#108"><B>LEGAL MATTERS</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>26</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#109"><B>EXPERTS</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>26</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#110"><B>WHERE YOU CAN FIND MORE INFORMATION</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>27</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#111"><B>INDEMNIFICATION</B></A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><B>28</B></TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c10767a1exv23w1.htm">Consent of Deloitte & Touche LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c10767a1exv23w2.htm">Consent of Piercy Bowler Taylor & Kern</A></FONT></TD></TR>
</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left">
<!-- /TOC -->
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">You should rely only on the information contained in this prospectus or to which we have referred
you. We have not, and the selling shareholders have not, authorized any other person to provide
you with different information. This prospectus is not an offer to sell, nor is it seeking an
offer to buy, these securities in any state where the offer or sale is not permitted. The
information in this prospectus is accurate as of the date of the front cover of this prospectus,
but the information may have changed since that date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">This prospectus is part of a registration statement that we filed with the Securities and Exchange
Commission. The registration statement containing this prospectus, including the exhibits to the
registration statement, also contains additional information about us and our securities offered
under this prospectus. That registration statement can be read at the Securities and Exchange
Commission&#146;s website (located at <u>www.sec.gov</U>) or at the Securities and Exchange Commission&#146;s Public
Reference Room mentioned under the heading &#147;Where You Can Find
More Information&#148; on page 27 of this
prospectus.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">&nbsp;(i)
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="101"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SUMMARY</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>This summary highlights certain information contained elsewhere in this prospectus and the
documents incorporated by reference into this prospectus. This summary does not contain all of the
information you should consider before investing in our common stock. We urge you to read this
entire prospectus carefully, including the risks of investing in our common stock discussed under
&#147;Risk Factors&#148; and the financial statements and other information that is incorporated by reference
into this prospectus, before making an investment decision. In addition, this prospectus summarizes
other documents that we urge you to read. All references in this prospectus to &#147;Lakes,&#148; &#147;we,&#148;
&#147;our,&#148; and &#147;us&#148; refer to Lakes Entertainment, Inc. and its subsidiaries.</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Business Overview</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We develop, finance and manage Indian-owned casino properties. We currently have development
(which includes certain financing requirements) and management agreements with two separate tribes
for one new casino development project in Michigan, one in California, and with two separate tribes
in Oklahoma for five various casino projects. We have agreements with a second tribe in California
to develop and finance a new casino project. We are also involved in other business activities,
including development of a non-Indian casino in Mississippi and the development of new table games
for licensing to both Tribal and non-Tribal casinos. In addition, as of November&nbsp;6, 2006, we owned
approximately 61% of WPT Enterprises, Inc., referred to as WPTE, a separate publicly held media and
entertainment company principally engaged in the development, production and marketing of gaming
themed televised programming, the licensing and sale of branded products and the sale of corporate
sponsorships. Our consolidated financial statements include the results of operations of WPTE, and
in recent periods, our revenues have been derived primarily from WPTE&#146;s business.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Indian Casino Business</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our primary business is to develop and manage Indian-owned casino properties that offer the
opportunity for long-term development of related entertainment facilities, including hotels, golf
courses, theaters, recreational vehicle parks and other complementary amenities. We currently have
agreements with five separate tribes that include one new casino development project in Michigan,
two new casino development projects in California, and three new casino development projects and
two existing casino operations in Oklahoma. We, through various subsidiaries, have entered into the
following contracts for the development and financing and/or management of new casino operations,
all of which are subject to various regulatory approvals and in some cases resolution of legal
proceedings:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have contracts to develop and manage The Foothill Oaks Casino to be built on the
Rancheria of the Shingle Springs Band of Miwok Indians, referred to as the Shingle Springs
Tribe, in El Dorado County, California, adjacent to U.S. Highway 50, approximately 30 miles
east of Sacramento, California, referred to as the Shingle Springs Casino.</TD>
</TR>

</TABLE>
</DIV>
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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have contracts to develop and manage the Four Winds Casino resort, which is being
built on land placed into trust for the Pokagon Band of Potawatomi Indians in New Buffalo
Township, Michigan near Interstate 94. The casino location is near the first Interstate 94
exit in southwestern Michigan and approximately 75 miles east of Chicago, referred to as
the Pokagon Casino. The Four Winds Casino resort is currently under construction with an
anticipated completion date of late summer 2007.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have contracts to develop and finance a casino to be built on the Rancheria of the
Jamul Indian Village, referred to as the Jamul Tribe, located on Highway 94, approximately
20 miles east of San Diego, California, referred to as the Jamul Casino.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have consulting agreements and management contracts with three wholly-owned
subsidiaries, referred to collectively as the Pawnee Nation, of the Pawnee Tribal
Development Corporation (&#147;TDC&#148;), in connection with assisting the Pawnee Nation in
developing, equipping and managing (1)&nbsp;the Chilocco Casino, which is planned to be built on
approximately 800 acres of Indian gaming land owned by the Pawnee Nation in northern
Oklahoma near the Kansas border, (2)&nbsp;the Pawnee Nation&#146;s existing Trading Post casino
operation in Pawnee, Oklahoma, and (3)&nbsp;the proposed casino operation at the Pawnee Nation&#146;s
existing Travel Plaza at the intersection of U.S. Highway 412 and State Highway 18,
approximately 25 miles from Stillwater, Oklahoma. However, on December&nbsp;1, 2006, Lakes
announced that the Pawnee Nation of Oklahoma Business Council (the &#147;Business Council&#148;)
declined to approve a proposed updated tribal agreement with a Lakes subsidiary relating to
the Pawnee Trading Post Casino. Since the consulting and management agreements were
originally entered into in January&nbsp;2005, several new members have been appointed to the
Business Council which has resulted in a substantial change in the Business Council&#146;s
membership. Lakes, the TDC and its gaming subsidiaries (the tribal entities that own and
operate the tribal casinos), which support approving the updated tribal agreement and
Lakes&#146; involvement in the projects, are evaluating how they wish to proceed with their
current project agreements given this action, including perhaps terminating the project
agreements.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For its consulting services, Lakes is receiving monthly fees of $5,000 related to the Trading
Post Casino project and is to receive monthly fees of $25,000 and $250,000 from the Travel
Plaza Casino and Chilocco Casino projects, respectively, upon their completion. Lakes had
also planned to manage each of these facilities under management contracts, subject to
regulatory approvals.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Lakes has advanced approximately $5.1&nbsp;million to the TDC related to these projects under the
existing agreements. Lakes intends to work with the TDC to resolve all of the financial
terms of the contracts including repayment of the advances if the project agreements are in
fact terminated as a result of the Business Council&#146;s decision. However, if the agreements
are terminated, there can be no assurance that Lakes will receive any future fees related to
these projects or that it will be repaid in full for its advances. As a result, Lakes&#146;
annual consolidated financial statements as of and for the year ended December&nbsp;31, 2006 are
expected to be adversely impacted by write-downs related to these advances, the</TD>
</TR>

</TABLE>
</DIV>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>magnitude of which cannot be determined at this time.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have consulting agreements and management contracts with the Iowa Tribe of Oklahoma,
referred to as the Iowa Tribe, in connection with developing, equipping and managing the
Ioway Casino resort which is planned to be built near Route 66 and approximately 25 miles
northeast of Oklahoma City, Oklahoma and the Iowa Tribe&#146;s existing Cimarron Casino, located
in Perkins, Oklahoma.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We have also explored, and are continuing to explore, other development projects with
Indian tribes.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Non-Indian Casinos</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also explore opportunities to develop and operate casinos that are not owned by Indian
tribes. We have received various regulatory approvals to develop a company-owned casino on
approximately 300 acres near Vicksburg, Mississippi. We do not expect to commence this project
until 2007.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>WPT Enterprises, Inc.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WPTE creates branded entertainment and consumer products driven by the development,
production, and marketing of televised programming based on gaming themes. WPTE&#146;s World Poker
Tour<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>, or WPT, television series, based on a series of high-stakes poker tournaments, airs in the
United States on the Travel Channel LLC, referred to as Travel Channel, and in more than 150
territories globally. WPTE has four operating units:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>WPT Studios. </I>WPTE&#146;s multi-media entertainment division generates revenue from the domestic and
international licensing of broadcast and telecast rights and through casino host fees. Since WPTE&#146;s
inception, the WPT Studios division has been responsible for approximately 75% of WPTE&#146;s total
revenue. WPTE licenses the WPT series to the Travel Channel for telecast in the United States under
an exclusive licensing agreement. WPTE has produced four complete seasons of the World Poker Tour
series under the WPTE agreements, and Season Five is currently in production. The Travel Channel
continues to hold options to license Seasons Six and Seven. WPTE also has license agreements for
the distribution of WPTE&#146;s World Poker Tour episodes in over 150 territories, for which WPTE
receives license fees, net of WPTE&#146;s agent sales fees and agreed upon sales and marketing expenses.
In addition, WPTE has a license agreement to telecast WPTE&#146;s new Professional Poker Tour<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>, or PPT,
series, which began airing in the third quarter of 2006. WPTE also collects annual host fees from
the member casinos that host World Poker Tour events (WPTE&#146;s member casinos). In May&nbsp;2006, WPTE
was notified by the licensee that it had chosen to not exercise its option for Season Two and
subsequent seasons of the PPT. WPTE is attempting to find a new broadcast partner for the PPT
going forward.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>WPT Consumer Products. </I>WPTE&#146;s branded consumer products division generates revenues
principally from royalties from the licensing of WPTE&#146;s brand to companies seeking to use the World
Poker Tour brand and logo in the retail sales of their consumer products. In
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">addition, this business unit generates revenue from direct sales of company-produced branded
merchandise. WPTE has generated significant revenues from existing licensees, including US Playing
Card, Hands-On Mobile, and MDI. WPTE also has a number of licensees that are developing new
licensed products including electronic, casino-based, poker related gaming machines from
International Game Technology, and interactive television games from Pixel Play.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>WPT Corporate Alliances. </I>WPTE sponsorship and event management division generates revenue from
corporate sponsorship and management of televised and live events. WPTE&#146;s sponsorship program uses
the professional sports model as a method to foster entitlement sponsorship opportunities and
naming rights to major corporations. Anheuser-Busch has been the largest source of revenues from
its sponsorship of Seasons Two, Three and Four of the World Poker Tour series on the Travel
Channel. During the third quarter of 2006, WPTE completed an agreement with Anheuser-Busch to
continue its sponsorship for Season Five of the World Poker Tour. During the second quarter of
2006, WPTE finalized a sponsorship agreement with Xyience, Inc., a non-alcoholic energy drink
developer and distributor, to promote its product as the &#147;official energy drink&#148; of Season Five and
Season Six of the World Poker Tour.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>WPT Online Gaming</I>. WPTE&#146;s online poker and casino gaming division generates revenue from
WPTE&#146;s agreement with WagerWorks, Inc., referred to as WagerWorks, pursuant to which WPTE granted
to WagerWorks a license to utilize the WPT brand to create a WPT-branded online gaming website,
WPTonline.com, which features an online poker room and an online casino with a broad selection of
slots and table games. In exchange for the license to WagerWorks of WPTE&#146;s brand, WagerWorks shares
with WPTE a percentage of all net revenue it collects from the operation of the online poker room
and online casino. Although any Internet user can access WPTonline.com via the World Wide Web, the
website does not permit bets to be made from players in the United States and other restricted
jurisdictions.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In June&nbsp;2006, WPTE entered into an agreement with CyberArts Licensing, LLC, referred to as
CyberArts, providing WPTE with a perpetual, nonexclusive and nontransferable license for the object
code of certain poker software and related banking and card room management software tools to
develop WPTE&#146;s own online poker room. The CyberArts agreement enables WPTE to develop, manage,
market and handle customer service for the online poker business from WPTE&#146;s own international
headquarters.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July&nbsp;2006, WPTE amended its agreement with WagerWorks to permit WPTE to own and operate an
online poker room, and fix a termination date for WagerWorks&#146; operation of WPTE&#146;s online poker
room. The amended agreement also permits WPTE to offer multi-player real-money poker gaming via
cellular phone using software provided by 3G Scene Limited, referred to as 3G Scene. WPTE entered
into a license agreement with 3G Scene in July&nbsp;2006 that grants 3G Scene a non-exclusive license to
use the World Poker Tour brand in promoting its real-money mobile gaming application solely in
jurisdictions where such gaming is not restricted. <U> </U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In October&nbsp;2006, the Unlawful Internet Gambling Act of 2006, referred to as the Act, was
signed into law. Among other things, the Act prohibits financial institutions from processing
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">payments in connection with unlawful internet gambling pursuant to state or federal laws. WPTE
believes that the Act is unlikely to have a direct adverse effect on WPTE&#146;s day-to-day operations,
since WPTE has always maintained a policy of not taking online wagers from patrons within the
United States of America. The Act could potentially result in increased competition to secure
online gaming customers outside the United States of America; however, the long-term impact, if
any, on WPTE&#146;s business cannot currently be determined.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Development and Marketing of Table Games</I></B><I>.</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have a division that buys, patents and licenses rights for new table game concepts to
market/distribute and license to casinos. We are continuing to test and market a number of games
including World Poker Tour &#147;All In Hold&#146;Em,&#148; &#147;Rainbow Poker,&#148; &#147;Pyramid Poker&#148; and &#147;Bonus Craps.&#148;
The World Poker Tour &#147;All In Hold&#146;Em&#148; game is currently operating in several casinos across the
United States. Our revenue from this division is currently not significant.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Real Estate Holdings</I></B><I>.</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have parcels of land in California and Oklahoma related to our Indian casino projects with
the Jamul Tribe, the Shingle Springs Tribe and the Iowa Tribe of Oklahoma; in Minnesota related to
our corporate headquarters; in Mississippi related to our planned company-owned casino; and in
Texas related to a terminated casino project.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Executive Offices</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are incorporated under the laws of the State of Minnesota. Our executive offices are
located at 130 Cheshire Lane, Suite&nbsp;101, Minnetonka, Minnesota, 55305, and our telephone number is
(952)&nbsp;449-9092. Our website address is
<u>www.lakesentertainment.com</u>. Information on our website does
not constitute part of this prospectus.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Material Changes</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There have been no material changes to our business affairs since the filing of our annual
report on Form 10-K for the fiscal year ended January&nbsp;1, 2006 which have not been described in our
SEC filings since that date.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>The Offering</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="48%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Common stock offered by selling shareholder
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1,625,000 shares</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Common stock outstanding after offering
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">24,573,635 shares</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Use of proceeds
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">We will not receive any proceeds
from the sale of common stock by
the selling shareholders.
However, as described in greater
detail in this prospectus under
the section &#147;Use of Proceeds&#148;,
we may receive the proceeds from
the exercise of the warrants
issued to</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="48%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">the selling shareholder.</TD>
</TR>
<TR><TD align="left" valign="top">&nbsp;</TD></TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Nasdaq Global Market Symbol
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">LACO</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Risk Factors
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investing in our common stock is
subject to several risks that
you should carefully consider
before deciding to invest in our
common stock. These risks are
discussed more fully in &#147;Risk
Factors.&#148;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Except as otherwise indicated, all information in this prospectus:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>excludes 4,716,400 shares of our common stock issuable upon the exercise of outstanding
options at a weighted average exercise price of $6.14 per share; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>excludes 35,500 shares of our common stock that are reserved for future grants of stock
options under our existing stock option plans.</TD>
</TR>

</TABLE>
</DIV>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>
<DIV align="left">
<A name="102"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>RISK FACTORS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Investing in our common stock involves a high degree of risk. You should carefully consider
the following risks, together with all of the other information included in, or incorporated by
reference into, this prospectus, before deciding to invest in our common stock. If any of the
following risks, or other risks that we have not identified or that we believe are immaterial or
unlikely, occur, our business, financial condition and results of operations could be materially
harmed. If that occurs, the trading price of our common stock could decline, and you may lose all
or part of your investment.</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risk Related to Our Industry</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The completion of our planned Indian and non-Indian casino development projects may be
significantly delayed or prevented due to a variety of factors, many of which are beyond our
control.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although we have experience developing and managing casinos owned by Indian tribes and located
on Indian land, we have not developed or managed a casino in the States of California or Michigan.
The opening of each of our proposed facilities will be contingent upon, among other things, the
completion of construction, hiring and training of sufficient personnel and receipt of all
regulatory licenses, permits, allocations and authorizations. The scope of the approvals required
to construct and open these facilities will be extensive, and the failure to obtain such approvals
could prevent or delay the completion of construction or opening of all or part of such facilities
or otherwise affect the design and features of the proposed casinos.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No assurances can be given that once a schedule for such construction and development
activities is established, such development activities will begin or will be completed on time, or
any other time, or that the budget for these projects will not be exceeded.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, the regulatory approvals necessary for the construction and operation of casinos
are often challenged in litigation brought by government entities, citizens groups and other
organizations and individuals. Such litigation can significantly delay the construction and opening
of casinos. Certain of our casino projects have been significantly delayed as a result of such
litigation, and there is no assurance that the litigation can be successfully resolved. Our casino
projects may experience further significant delays before they can be completed, if ever.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Major construction projects entail significant risks, including shortages of materials or
skilled labor, unforeseen engineering, environmental and/or geological problems, work stoppages,
weather interference, unanticipated cost increases and non-availability of construction equipment.
These factors or delays or difficulties in obtaining any of the requisite licenses, permits,
allocations and authorizations from regulatory authorities could increase the total cost, delay or
prevent the construction or opening of any of these planned casino developments or otherwise affect
their design.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If our current casino development projects are not completed or fail to successfully compete</I></B>
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>once completed, we may lack the funds to compete for and develop future gaming or other business
opportunities which may have a material adverse effect on our results of operations.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The gaming industry is highly competitive. Gaming activities include traditional land-based
casinos; river boat and dockside gaming; casino gaming on Indian land; state-sponsored lotteries
and video poker in restaurants, bars and hotels; pari-mutuel betting on horse racing and dog
racing; sports bookmaking; and card rooms. The casinos to be managed or owned by us compete, and
will in the future compete, with all these forms of gaming, and will compete with any new forms of
gaming that may be legalized in additional jurisdictions, as well as with other types of
entertainment.
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also compete with other gaming companies for opportunities to acquire legal gaming sites in
emerging and established gaming jurisdictions and for the opportunity to manage casinos on Indian
land. Many of our competitors have more personnel and may have greater financial and other
resources than us. Such competition in the gaming industry could adversely affect our ability to
attract customers which would adversely affect our operating results. In addition, further
expansion of gaming into new jurisdictions could also adversely affect our business by diverting
customers from our planned managed casinos to competitors in such jurisdictions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We could be prevented from completing our current casino development projects or pursuing future
development projects due to changes in the laws, regulations and ordinances (including tribal or
local laws) that apply to gaming facilities or the inability of us or our key personnel,
significant shareholders or joint venture partners to obtain or retain gaming regulatory licenses.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The ownership, management and operation of gaming facilities are subject to extensive federal,
state, provincial, tribal and/or local laws, regulations and ordinances, which are administered by
the relevant regulatory agency or agencies in each jurisdiction. These laws, regulations and
ordinances vary from jurisdiction to jurisdiction, but generally concern the responsibility,
financial stability and character of the owners and managers of gaming operations as well as
persons financially interested or involved in gaming operations, and often require such parties to
obtain certain licenses, permits and approvals.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The rapidly-changing political and regulatory environment governing the gaming industry
(including gaming operations which are conducted on Indian land) makes it impossible for us to
accurately predict the effects that an adoption of or changes in the gaming laws, regulations and
ordinances will have on us. However, the failure of us, or any of our key personnel, significant
shareholders or joint venture partners, to obtain or retain required gaming regulatory licenses
could prevent us from expanding into new markets, prohibit us from generating revenues in certain
jurisdictions, and subject us to sanctions and fines.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The political and regulatory environment in which we operate, including with respect to gaming
activities on Indian land, is discussed in greater detail in our Annual Report on Form 10-K for the
fiscal year ended January&nbsp;1, 2006, referred to as the 2005 Form 10-K, under the caption
&#147;Business-Regulation.&#148;
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>During September&nbsp;2005, legislation was proposed to amend the Gambling Devices Act of 1962 which
could negatively affect projected management/consulting fees from the Shingle Springs and Jamul
Casino projects.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During September&nbsp;2005, the Department of Justice proposed legislation that would amend the
Gambling Devices Act of 1962 (commonly referred to as the Johnson Act). The proposal seeks to
clarify the difference between Class&nbsp;II and Class&nbsp;III machines. It prohibits Indian tribes from
operating games that resemble slot machines without a tribal-state compact. The legislation
proposes to amend the Johnson Act in three significant ways. First, the definition of &#147;gaming
device&#148; in Section&nbsp;1171 of the Johnson Act would be amended to clarify how the element of chance
can be provided in a gaming device. Second, Section&nbsp;1172 of the Johnson Act would be amended to
clarify that certain &#147;qualifying&#148; technological aids could be transported and used in Indian
country. Third, a new Section (d)&nbsp;would be added to Section&nbsp;1175 of the Johnson Act to provide an
express exception to allow technological devices to be used in Class&nbsp;II gaming.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This is only proposed legislation, but if passed it could affect our planned casino operations
for the Shingle Springs Tribe and the Jamul Tribe and distributable fees to us. Class&nbsp;II machines
are currently planned to be used at the Shingle Springs and Jamul Casinos. If the legislation were
passed there is no assurance that substitute allowable Class&nbsp;II machines would result in the same
projected operating results as the Class&nbsp;II machines currently planned to be used and in use by the
above-mentioned projects. If this were to occur it could have a material adverse effect on our
results of operations and financial conditions.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risks Related to Our Business</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Any significant delay in, or non-completion of, our planned Indian and non-Indian casino
development projects could have a material adverse effect on our future cash flows and
profitability.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since the expiration of our management contract for Grand Casino Coushatta (the last remaining
Indian-owned casino managed by us) on January&nbsp;16, 2002, we have generated minimal revenue from our
casino management activities. We have had minimal current casino management-related operating
revenue with which to offset the investment costs associated with our current or future casino
development projects. Delays in the completion of our current development projects, or the failure
of such projects to be completed at all, may cause our operating results to vary significantly and
may adversely affect our future earnings, cash flows and financial condition, and/or could
ultimately cause us to cease our operations entirely. In addition, once developed, no assurances
can be given that we will be able to manage these casinos on a profitable basis or to attract a
sufficient number of guests, gaming customers and other visitors to make the various operations
profitable independently. With each project we are subject to the risk that our investment may be
lost if the project cannot obtain adequate financing to complete development and open the casino
successfully. In some cases, we may be forced to provide more financing than we originally planned
in order to complete development, increasing the risk to us in the event of a default by the
casino. In addition, because our future growth in
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">revenues and our ability to generate profits will depend to a large extent on our ability to
increase the number of our managed casinos or develop new business opportunities, the delays in the
completion or the non-completion of our current development projects may adversely affect our
ability to realize future growth in revenues and future profits.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The termination of our management contracts and consulting agreements with Indian tribes may have a
material adverse effect on our results of operations and financial condition.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The terms of our current management contracts and consulting agreements provide that such
contracts may be terminated under certain circumstances, including without limitation, the possible
failure to obtain NIGC approval for the project, the loss of requisite gaming licenses, or an
exercise by an Indian tribe of its buyout option. In addition, each of our current management and
consulting agreements expire by their terms anywhere from five to seven years after commencement of
casino operations for the project. Without the realization of new business opportunities or new
management contracts or consulting agreements, the termination of management contracts and/or
consulting agreements could have a material adverse effect on our results of operations and
financial condition.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If the NIGC elects to modify the terms of our management contracts with Indian tribes or void such
contracts altogether, our revenues from management contracts may be reduced or eliminated.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The NIGC has the power to require modifications to Indian management contracts under certain
circumstances or to void such contracts or ancillary agreements including loan agreements if the
management company fails to obtain requisite approvals or to comply with applicable laws and
regulations. The NIGC has the right to review each contract and has the authority to reduce the
term of a management contract or the management fee or otherwise require modification of the
contract, which could have an adverse effect on us. Currently, only our management contracts with
Shingle Springs, Pokagon Band and the Iowa Tribe of Oklahoma (relating to the Cimarron Casino
project in Oklahoma) have been approved by the NIGC. The other management contracts have not
received final approval by the NIGC and may require modification prior to receiving approval.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If Indian tribes default on their repayment obligations or wrongfully terminate their management
contracts with us, we may be unable to collect the amounts due.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have made, and may make, substantial loans to Indian tribes for the construction,
development, equipment and operations of casinos to be managed by us. Our only recourse for
collection of indebtedness from an Indian tribe or money damages for breach or wrongful termination
of a management contract is from revenues, if any, from casino operations. We have subordinated,
and may in the future subordinate again, to other parties related to the casino operations, the
repayment of loans made to an Indian tribe and other distributions due from an Indian tribe
(including management fees) in favor of other obligations of the Indian tribe. Accordingly, in the
event of a default by an Indian tribe under such obligations, our loans and other claims against
the Indian tribe will not be repaid until such default has been cured or the Indian tribe&#146;s senior
casino-related creditors have been repaid in full.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>A deterioration of our relationship with an Indian tribe could cause delays in the completion of a
casino development project with that Indian tribe or even force us to abandon a casino development
project altogether and prevent or significantly impede recovery of our investment therein.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Good personal and professional relationships with Indian tribes and their officials are
critical to our proposed and future Indian-related gaming operations and activities, including our
ability to obtain, develop and effectuate management and other agreements. As sovereign nations,
Indian tribes establish their own governmental systems under which tribal officials or bodies
representing an Indian tribe may be replaced by appointment or election or become subject to policy
changes. Replacements of Indian tribe officials or administrations, changes in policies to which
an Indian tribe is subject, or other factors that may lead to the deterioration of our relationship
with an Indian tribe may cause delays in the completion of a development project with that Indian
tribe or prevent the project&#146;s completion altogether, which may have an adverse effect on the
results of our operations.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If funds from our operations are insufficient to support our cash requirements and we are unable to
obtain additional financing in order to satisfy these requirements, we may be forced to delay,
scale back or eliminate some of our expansion and development goals, or cease our operations
entirely.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will require additional capital through either public or private financings to meet
operating and development expenses during fiscal 2007 and we are currently considering various
financing alternatives. In February&nbsp;2006, we closed on a $50&nbsp;million financing facility with the
selling shareholder named in this prospectus, who is an affiliate of Prentice Capital Management,
LP, referred to as Prentice. The $25&nbsp;million outstanding principal balance under the facility
together with accrued interest was repaid in full in June&nbsp;2006, as discussed below.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On June&nbsp;22, 2006, we borrowed $105&nbsp;million under a financing facility with Bank of America,
N.A., referred to as BofA, under a credit agreement among us, our subsidiary, Lakes Gaming and
Resorts, LLC, BofA and the lenders. Approximately $25.2&nbsp;million of the initial draw was used to
repay in full the loan payable to Prentice.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As previously announced, while the funds from the BofA credit agreement allow us to move
forward with various casino development projects, we anticipate incurring additional
pre-construction costs which will require additional sources of financing during fiscal 2007 to
meet operational and development needs. Therefore, we will continue to explore additional
financing alternatives to fund those needs. Such financings may not be available when needed on
terms acceptable to us or at all. Moreover, any additional equity or debt financings may be
dilutive to our shareholders, and any debt financing may involve additional restrictive covenants.
An inability to raise such funds when needed might require us to delay, scale back or eliminate
some of our expansion and development goals, or might require us to cease our operations entirely.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, the construction of our Indian casino projects may depend on the ability of the
Indian tribes to obtain financing for the projects. If such financing cannot be obtained on
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">acceptable terms, it may not be possible to complete these projects. In order to assist the Indian
tribes, we may be required to guarantee the Indian tribes&#146; debt financing or otherwise provide
support for the Indian tribes&#146; obligations. Any guarantees by us or similar off-balance sheet
obligations, if any, will increase our potential exposure in the event of a default by any of these
Indian tribes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If one or more of our Indian casino projects fail to open, the recorded assets related to those
projects will be impaired and there may be a material adverse impact on our financial results.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We record assets related to Indian casino projects on our consolidated balance sheet as
long-term assets related to Indian casino projects. The majority of our long-term assets related
to Indian casino projects are in the form of loans to the Indian tribes pursuant to our financing
agreements with varying degrees of collection risk, and with repayment often dependent on the
operating performance of each gaming property. These loans are included as notes receivable on the
consolidated balance sheet, under the category &#147;long-term assets related to Indian casino
projects&#148;. At October&nbsp;1, 2006, we had $224.9&nbsp;million in long-term assets related to Indian casino
projects, of which $149.2&nbsp;million was in the form of notes receivable, which are recorded at
estimated fair value on the consolidated balance sheet, which represented approximately 42% of our
total assets. See Note 3 to our consolidated financial statements included in our Quarterly Report
on Form 10-Q for the quarterly period ended October&nbsp;1, 2006, referred to as our 2006 Third Quarter
Form 10-Q. The loans are made to Indian tribes for pre-construction financing related to gaming
properties being developed by us. All of the loans are subject to varying degrees of collection
risk and there is no established market for these loans. For the loans representing indebtedness of
Indian tribes, the repayment terms are specific to each Indian tribe and are largely dependent upon
the operating performance of each gaming property. Repayments of such loans are required to be
made only if distributable profits are available from the operation of the related casinos.
Repayments are also the subject of certain distribution priorities specified in the management
contracts. In addition, repayment to us of the loans and the manager&#146;s fees under our management
contracts are subordinated to certain other financial obligations of the respective Indian tribes.
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Included in long-term assets related to Indian casino projects are intangible assets related
to the acquisition of the management contract, land held for development and other costs incurred
in connection with opening the casino of $54.1&nbsp;million, $16.7&nbsp;million and $4.9&nbsp;million,
respectively, at October&nbsp;1, 2006. It is possible that one or more of our Indian casino projects
will fail to open, which will render the majority of the assets related to the failed Indian casino
project impaired. See the latest version of our critical accounting policies and estimates in the
section entitled &#147;Management&#146;s Discussion and Analysis of Financial Condition and Results of
Operations&#148; in our Third Quarter Form 10-Q.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Our entry into new businesses may result in future losses.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have announced that part of our strategy involves diversifying into other businesses such
as developing and owning our own casino and the development and marketing of our own table games.
Development of table games involves business risks separate from the risks involved in casino
development and these investments may result in future losses to us. These
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">risks include but are not limited to negative cash flow, initial high development costs of new
products and/or services without corresponding sales pending receipt of corporate and regulatory
approvals, market introduction and acceptance of new products and/or services, and obtaining
regulatory approvals required to conduct the new businesses. Our diversification activities may
never successfully add to our future revenues and income.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We cannot guarantee the financial results of the expansion of the World Poker Tour business, the
results of which may negatively impact our financial results.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of November&nbsp;6, 2006, we, through our subsidiary Lakes Poker Tour, LLC, owned approximately
61% of the outstanding common stock of WPTE. As a result, our consolidated financial results
include WPTE&#146;s operations. In fiscal 2004, our consolidated revenues of $17.6&nbsp;million, were
derived entirely from the WPTE business, mainly from license fees for United States telecast of
World Poker Tour television episodes. In fiscal 2005 our consolidated revenues of $18.2&nbsp;million
were derived from WPTE. WPTE&#146;s revenues were $18.1&nbsp;million for fiscal 2005 from the delivery of 13
Season Three episodes and five Season Four episodes, international television licensing of the
World Poker Tour&#146;s Season One and Two and product licensing fees.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WPTE&#146;s revenues for the first nine months of 2006 were $23.2&nbsp;million and primarily included
delivery of 16 episodes of Season Four of the World Poker Tour, one episode of Season Five of the
World Poker Tour and 19 episodes of the Professional Poker Tour. Additionally, by the end of 2006,
WPTE expects to deliver three additional episodes of Season Five of the World Poker Tour and the
remaining five episodes of Season One of the Professional Poker Tour. The margins for the PPT were
higher in the first three quarters of 2006 as certain production costs had previously been
expensed. WPTE has produced four complete seasons of the World Poker Tour series under the
agreements, and Season Five is currently in production. The Travel Channel continues to hold
options to license Seasons Six and Seven. On May&nbsp;1, 2006, the Travel Channel notified WPTE that it
had chosen to not exercise its options for Season Two and subsequent seasons of the PPT. The PPT&#146;s
first season, which includes 24 two-hour episodes, has already been filmed and began to air on TRV
in July&nbsp;2006. WPTE is attempting to find a new broadcast partner for the PPT going forward. WPTE
expects to continue to increase sales and marketing expenses related to WPTonline.com during the
remainder of 2006 in order to increase player traffic on the site. Fiscal 2006 operating and net
earnings has been negatively impacted by the adoption of FAS 123R, requiring WPTE to expense
employee stock options.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We can provide no assurance that WPTE will achieve its forecasted revenues for the remainder
of 2006 and thereafter, that WPTE will be able to expand its business, or that WPTE&#146;s operations
will positively impact our financial results because WPTE&#146;s business is subject to many risks and
uncertainties. The risks include, but are not limited to, WPTE&#146;s relatively short operating
history, WPTE&#146;s dependence on its agreements with Travel Channel, continued public acceptance of
the World Poker Tour programming and brand, protection of WPTE&#146;s intellectual property rights, and
its ability to successfully expand into new and complementary businesses, including internet
gaming. The Unlawful Internet Gambling Enforcement Act of 2006 prohibits online gaming in the
United States of America. Because WPTE&#146;s internet gambling site does not allow for online gambling
from within the United States of America, the Act is not currently
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">expected to adversely impact WPTE, but the potential long-term effects of the Act on market
competition can not be predicted at this time.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We are dependent on the ongoing services of our Chairman and Chief Executive Officer, Lyle Berman,
and the loss of his services could have a detrimental effect on the pursuit of our business
objectives, profitability and the price of our common stock.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our success will depend largely on the efforts and abilities of our senior corporate
management, particularly Lyle Berman, our Chairman and Chief Executive Officer. The loss of the
services of Mr.&nbsp;Berman or other members of senior corporate management could have a material
adverse effect on us. We have a $20&nbsp;million key man life insurance policy on him.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risks Relating to this Offering</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our Articles of Incorporation and Bylaws may discourage lawsuits and other claims against our
directors.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Articles of Incorporation and Bylaws provide, to the fullest extent permitted by Minnesota
law, that our directors shall have no personal liability for breaches of their fiduciary duties to
us. In addition, our Bylaws provide for mandatory indemnification of directors and officers to the
fullest extent permitted by Minnesota law. These provisions reduce the likelihood of derivative
litigation against our directors and may discourage shareholders from bringing a lawsuit against
directors for a breach of their duty.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our Articles of Incorporation contain provisions that could discourage or prevent a potential
takeover, even if the transaction would be beneficial to our shareholders.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Articles of Incorporation authorize our Board of Directors to issue up to 200&nbsp;million
shares of capital stock, the terms of which may be determined at the time of issuance by the Board
of Directors, without further action by our shareholders. The Board of Directors may authorize
additional classes or series of shares that may include voting rights, preferences as to dividends
and liquidation, conversion and redemptive rights and sinking fund provisions that could adversely
affect the rights of holders of our common stock and reduce the value of our common stock. In
connection with closing on a $50&nbsp;million financing facility in February&nbsp;2006, our Board of
Directors authorized the creation of class of Series&nbsp;A Convertible Preferred Stock with contingent
conversion rights and limited voting rights, and we issued an aggregate of 4,451,751 shares of such
preferred stock to an affiliate of Prentice. The Series&nbsp;A Convertible Preferred Stock and any
other class of preferred stock that may be authorized by our Board of Directors for issuance in the
future could make it more difficult for a third party to acquire us, even if a majority of our
holders of common stock approved of such acquisition.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The price of our common stock may be adversely affected by significant price fluctuations due to a
number of factors, many of which are beyond our control.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The market price of our common stock has experienced significant fluctuations and may continue
to fluctuate in the future. The market price of our common stock may be significantly affected by
many factors, including:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>obtaining all necessary regulatory approvals for our casino development projects;</TD>
</TR>

</TABLE>
</DIV>
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<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>litigation surrounding one or more of our casino developments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>changes in requirements or demands for our services or WPTE&#146;s products;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the announcement of new products or product enhancements by us or our competitors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>technological innovations by us or our competitors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>quarterly variations in our or our competitors&#146; operating results;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>changes in prices of our or our competitors&#146; products and services;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>changes in our revenue and revenue growth rates;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>changes in earnings or (loss)&nbsp;per share estimates by market analysts or speculation in the
press or analyst community; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>general market conditions or market conditions specific to particular industries.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We have issued numerous options and warrants to acquire our common stock that could have a dilutive
effect on our common stock.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of October&nbsp;1, 2006, we had options outstanding to acquire 4.8&nbsp;million shares of our common
stock, exercisable at prices ranging from $3.25 to $18.16 per share, with a weighted average
exercise price of approximately $6.11 per share. During the terms of these options, the holders
will have the opportunity to profit from an increase in the market price of our common stock with
resulting dilution to the holders of shares who purchased shares for a price higher than the
respective exercise or conversion price. In addition, the increase in the outstanding shares of
our common stock as a result of the exercise or conversion of these options could result in a
significant decrease in the percentage ownership of our common stock by the purchasers of its
common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In February&nbsp;2006, we closed on a $50&nbsp;million financing facility with Prentice. As
consideration for the financing, we issued to an affiliate of Prentice warrants to purchase up to
1.25&nbsp;million shares of common stock that can be immediately exercised at $7.50 per share. The
warrants are subject to customary anti-dilution protections. The shares underlying these warrants
are being registered for resale by the selling shareholder. The warrants expire in February&nbsp;2013.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The market price of our common stock may be reduced by future sales of our common stock in the
public market.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales of substantial amounts of our common stock in the public market that are not currently
freely tradable, or even the potential for such sales, could have an adverse effect on the market
price for shares of our common stock and could impair the ability of purchasers of our common stock
to recover their investment or make a profit. As of October&nbsp;1, 2006, these shares consist of
approximately 8.0&nbsp;million shares beneficially owned by our executive officers and directors.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Certain provisions in our articles of incorporation may require a shareholder to sell to us shares
of our capital stock held by such shareholder, even if the shareholder does not want to sell.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gaming regulations in various jurisdictions in which we have casino development projects
impose certain restrictions on the equity ownership of licensed casino operators. In order to
facilitate compliance with these regulations and to preserve our ability to be awarded additional
gaming licenses in the future, our articles of incorporation include a provision that allows us to
redeem, at fair market value, shares of our capital stock held by any shareholder whose status as a
shareholder, in the opinion of our board of directors, jeopardizes the approval, continued
existence or renewal by any gaming regulatory authority, of a contract to manage gaming operations,
or any other tribal, federal or state license or franchise held by us or any of our subsidiaries.
As a result, a shareholder could be required to sell our capital stock at a time when the
shareholder may consider our securities to be undervalued or may otherwise not want to sell our
securities.
</DIV>

<DIV align="left">
<A name="103"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Private Securities Litigation Reform Act of 1995 provides a &#147;safe harbor&#148; for
forward-looking statements. Certain information included in this prospectus, including the
documents that are incorporated by reference into this prospectus, contain statements that are
forward-looking, such as plans for future expansion and other business development activities as
well as other statements regarding capital spending, financing sources and the effects of
regulation (including gaming and tax regulation) and competition.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Such forward looking information involves important risks and uncertainties that could
significantly affect our anticipated results in the future and, accordingly, actual results may
differ materially from those expressed in any forward-looking statements made by or on behalf of
us.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These risks and uncertainties include, but are not limited to, need for current financing to
meet our operational and development needs; those relating to the inability to complete or possible
delays in completion of our 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; we operate in a highly competitive
industry; possible changes in regulations; reliance on continued positive relationships with Indian
tribes and repayment of amounts owed to us by Indian tribes; continued contracts with the Pawnee
Nation as a result of the change in its business council membership; possible need for future
financing to meet our expansion goals; risks of entry into new businesses; reliance on our
management; and the fact that WPTE shares held by us are currently not liquid assets, and there is
no assurance that we will be able to realize value from these holdings equal to the current or
future market value of WPTE common stock. There are also risks and uncertainties relating to WPTE
that may have a material effect on our consolidated results of operations or the market value of
the WPTE shares held by us, including WPTE&#146;s significant dependence on the Travel Channel LLC as a
source of revenue; the potential that
WPTE&#146;s television programming may fail to maintain a sufficient audience; difficulty of
predicting the growth of WPTE&#146;s online casino business, which is a relatively new industry with
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">an
increasing number of market entrants; the risk that WPTE may not be able to protect its
entertainment concepts, current and future brands and other intellectual property rights; the risk
that competitors with greater financial resources or marketplace presence might develop television
programming that would directly compete with WPTE&#146;s television programming; the increased time,
cost and expense of developing and maintaining WPTE&#146;s own online gaming software; the risk that
WPTE may not be able to protect its entertainment concepts, current and future brands and other
intellectual property rights; risks associated with future expansion into new or complementary
businesses; the termination or impairment of WPTE&#146;s relationships with key licensing and strategic
partners; and WPTE&#146;s dependence on its senior management team. For more information, review our
filings with the United States Securities and Exchange Commission. For further information
regarding the risks and uncertainties, see &#147;Risk Factors.&#148;
</DIV>

<DIV align="left">
<A name="104"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>USE OF PROCEEDS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All net proceeds from the sale of shares of our common stock in this offering will go to the
selling shareholder who offers and sells them. We will not receive any proceeds from this
offering. Any sale of shares by us to the selling shareholder in connection with the exercise of
the warrants will be made pursuant to an exemption from the registration requirements of the
applicable securities laws. We expect to use the proceeds from such sales for general working
capital purposes.
</DIV>


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<DIV align="left">
<A name="105"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SELLING SHAREHOLDER</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The shares of our common stock being offered by the selling shareholder are issuable upon
conversion of the preferred shares and upon exercise of the warrants. In February&nbsp;2006, pursuant
to the terms of a securities purchase agreement, we sold 4.46&nbsp;million preferred shares and warrants
for the purchase of up to 4.46&nbsp;million shares of our common stock to the selling shareholder. The
preferred shares and warrants were issued in connection with closing on a $50&nbsp;million financing
facility with an affiliate of the selling shareholder. The aggregate purchase price for the
preferred shares was approximately $44,578, and a nominal amount was paid for the warrants. The
preferred shares and warrants were issued to the selling shareholder in reliance upon exemptions
from the registration requirements of applicable securities laws. As a result of the financing
facility being paid off in full, warrants for the purchase of up to 3.21&nbsp;million shares lapsed and
are no longer exercisable. We are registering the shares of our common stock in order to permit
the selling shareholder to offer the shares for resale from time to time. Except for the ownership
of the preferred shares and the warrants issued pursuant to the securities purchase agreement, and
the $50&nbsp;million financing facility, the selling shareholder has not had any material financial
relationship with us within the past three years.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The table below lists the selling shareholder and other information regarding the beneficial
ownership of the shares of common stock by the selling shareholder. The second column lists the
number of shares of common stock beneficially owned by the selling shareholder, based on its
ownership of the preferred shares and warrants, as of December&nbsp;29, 2006, assuming conversion of all
preferred shares and exercise of the warrants held by the selling shareholder on that date, without
regard to any limitations on conversions or exercise.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The third column lists the shares of our common stock being offered by this prospectus by the
selling shareholder.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In accordance with the terms of a registration rights agreement between us and the selling
shareholder, this prospectus generally covers the resale of at least 130% of the sum of (i)&nbsp;the
number of shares of common stock issuable upon conversion of the preferred shares as of the trading
day immediately preceding the date the registration statement is initially filed with the
Securities and Exchange Commission and (ii)&nbsp;the number of shares of common stock issuable upon
exercise of the related warrants as of the trading day immediately preceding the date the
registration statement is initially filed with the Securities and Exchange Commission<B>. </B>Because the
conversion price of the preferred shares may be adjusted and the exercise price of the warrants may
be adjusted, the number of shares that will actually be issued may be more or less than the number
of shares being offered by this prospectus. The fourth column assumes the sale of all of the
shares offered by the selling shareholder pursuant to this prospectus.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the terms of the preferred shares and the warrants, the selling shareholder may not
convert the preferred shares or exercise the warrants to the extent such conversion or exercise
would cause the selling shareholder, together with its affiliates, to beneficially own a number of
shares of our common stock which would exceed 4.99% of our then outstanding shares of common stock
following such conversion or exercise, excluding for purposes of such determination shares of
common stock issuable upon conversion of the preferred shares that have
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">not been converted and upon exercise of the warrants that have not been exercised. The number
of shares in the second column does not reflect this limitation. The selling shareholder may sell
all, some or none of its shares in this offering. See &#147;Plan of Distribution.&#148;
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000"><B>Maximum Number of Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Number of Shares</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Number of Shares Owned</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>to be Sold Pursuant to this</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Owned</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Name of Selling Shareholder</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Prior to Offering</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Prospectus</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>After Offering</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">PLKS Holdings, LLC (1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,250,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,625,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD>Prentice Capital Management, L.P. has investment and voting power with respect to the
securities held by PLKS Holdings, LLC. Mr.&nbsp;Michael Zimmerman is the managing member of the general
partner of Prentice Capital Management, L.P. Each of Prentice Capital Management and Mr.
Zimmerman disclaim beneficial ownership of any of these securities.</TD>
</TR>

</TABLE>


<DIV align="left">
<A name="106"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>DESCRIPTION OF CAPITAL STOCK</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>General</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our articles of incorporation authorize our board of directors to issue 200,000,000 shares of
capital stock, $0.01 par value per share. As of December&nbsp;29, 2006, these shares consist of
22,948,635 issued and outstanding shares of common stock, $0.01 par value, referred to as common
stock, and 7,500,000 shares of authorized series A convertible preferred stock,$0.01 par value per
share. Apart from those shares and shares of common stock reserved for issuance under our stock
option plans and our outstanding common stock purchase warrants, our remaining authorized capital
stock consists of authorized voting common stock unless and until our board of directors
establishes by resolution additional different classes or series of capital stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Series&nbsp;A Convertible Preferred Stock</B>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of December&nbsp;29, 2006, we had 4,457,751 shares of our series A convertible preferred stock,
referred to as preferred stock, issued and outstanding. We issued these preferred shares to the
selling stockholder who provided us with a $50&nbsp;million financing facility under a financing
agreement dated February&nbsp;15, 2006, referred to as the financing agreement. Of the 4,457,751 shares
of preferred stock outstanding, only 1,250,000 shares can ever become convertible as described
further below in the section entitled &#147;Conversion Rights.&#148; The following is a summary of the
material rights and privileges of our preferred stock.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Voting</I>. The holders of preferred stock currently do not have cumulative voting for the
election of directors or other voting rights, except as required under applicable laws.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Dividends. </I>The holders of our preferred stock have no special dividend rights.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Preemptive Rights</I>. The holders of our preferred stock have no preemptive rights to
subscribe for any additional shares of any class of our capital stock or for any issue of bonds,
notes or other securities convertible into any class of our capital stock.
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Liquidation Preference</I>. The holders of our preferred stock have no liquidation preference
over holders of our common stock.
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Redemption Rights. </I>The holders of our preferred stock have the following redemption rights:
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the preferred stock must be redeemed by us upon the occurrence of a &#147;regulatory
redemption event&#148; as defined in the certificate of designation at a price specified in the
certificate of designation; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the holders of the preferred stock have the optional right to require us to redeem the
preferred stock if a &#147;registration rights default&#148; as defined in the certificate of
designation occurs at a price specified in the certificate of designation.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Conversion Rights. </I>Up to 1,250,000 shares of preferred stock can each become immediately
convertible into one share of common stock if, but only if:
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we cancel or redeem the warrants issued to the selling shareholder in connection with
the $50&nbsp;million financing facility or the shares of common stock issued pursuant to an
exercise of the warrants; and</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the cancellation or redemption of the warrants results from the application of the
terms and conditions of our articles of incorporation or any applicable law, rule or
regulation.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under our articles of incorporation, our board of directors may, at any time, authorize us to
redeem the shares of our capital stock held by any &#147;disqualified holder&#148; as defined in our articles
of incorporation. A &#147;disqualified holder&#148; means any beneficial owner of our capital stock whose
ownership may result, in the judgment of our board of directors, in:
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the disapproval, modification, or non-renewal of any contract under which we or any of
our subsidiaries has sole or shared authority to manage any gaming operations; or</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the failure to obtain or the loss or nonreinstatement of any license or franchise from
any governmental agency held by us or any of our subsidiaries to conduct any portion of
our business or the business of any of our subsidiaries if the license or franchise is
conditioned upon some or all of the holders of capital stock meeting certain criteria.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The shares are redeemable at a redemption price equal to the capital stock&#146;s fair market value (as
defined in our articles of incorporation). The redemption price is payable in cash or our
securities or any combination of cash or securities selected by our board of directors.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At any time after any of the shares of preferred stock become convertible, the holder of the
preferred stock can elect to convert some or all of the holder&#146;s then convertible preferred stock
by:
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>giving written notice of conversion to us; and</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>
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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>paying to us in cash or by wire transfer an amount equal to the number of shares of
preferred stock being converted multiplied by the applicable conversion price.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The conversion price is currently equal to $7.50 per share. The conversion price is subject to
adjustment in the event of, among other things, stock splits, stock dividends or similar events.
The conversion price and the number of shares of outstanding preferred stock are also subject to
adjustment if we issue shares of our common stock at prices below the then existing conversion
price. The preferred stock may be converted on a cashless basis only if a registration statement
is not available for the resale of the shares of common stock issuable upon conversion of the
preferred stock at the time of conversion.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither we nor any holder of preferred stock can effect the conversion of any share of
preferred stock to the extent that after giving effect to such conversion, the holder converting
shares of preferred stock would beneficially own (directly or indirectly) in excess of 4.99% of
our outstanding shares of common stock outstanding after giving effect to such conversion.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Purchase Rights. </I>If we grant, issue or sell options, warrants, other convertible securities
or other property pro rata to holders of our common stock, the holders of our preferred stock will
be entitled to acquire such securities or property on similar terms determined as if the preferred
stock then held by them has been fully converted into common stock.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Rights in the Event of Certain Fundamental Transactions. </I>If we engage in one or more
&#147;fundamental transactions&#148; as defined in the certificate of designation, then each holder of
preferred stock has the right to either:
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>purchase and receive the shares of stock, securities or assets issuable or payable
with respect to the number of shares of common stock then issuable upon a conversion of
the preferred stock as if the fundamental transaction had not taken place; or</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>require the repurchase of the preferred stock held by the holder for a purchase price
equal to the &#147;black scholes value&#148; as defined in the certificate of designation of the
remaining unconverted portion of preferred stock held by the holder on the date of the
request. The purchase price is payable in cash within five trading days after such a
request.</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The term &#147;fundamental transactions&#148; means, among other things, a merger, consolidation, sale of
substantially all of our properties or assets or the acquisition of more than 50% of our
outstanding shares of preferred stock.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of December&nbsp;29, 2006, we had 22,948,635 shares of common stock outstanding. All outstanding
shares of our common stock are fully paid and nonassessable. Our shares of common stock are quoted
on The Nasdaq Global Market. The following is a summary of the material rights and privileges of
our common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Voting. </I>Holders of our common stock are entitled to cast one vote for each share held at all
shareholder meetings for all purposes, including the election of directors. The holders of more
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">than 50% of the voting power of our common stock issued and outstanding and entitled to vote and
present in person or by proxy, together with any preferred stock issued and outstanding and
entitled to vote and present in person or by proxy, constitute a quorum at all meetings of our
shareholders. The vote of the holders of a majority of our common stock present and entitled to
vote at a meeting, together with any preferred stock present and entitled to vote at a meeting,
will decide any question brought before the meeting, except when Minnesota law requires a greater
vote and except when Minnesota law requires a vote of any preferred stock issued and outstanding,
voting as a separate class, to approve a matter brought before the meeting. Holders of our common
stock do not have cumulative voting for the election of directors.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Dividends. </I>Holders of our common stock are entitled to dividends when, as and if declared by
the board of directors out of funds available for distribution. The payment of any dividends are
limited by the terms of the BofA financing agreement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Pre-emptive Rights. </I>The holders of our common stock have no pre-emptive rights to subscribe
for any additional shares of any class of our capital stock or for any issue of bonds, notes or
other securities convertible into any class of our capital stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Liquidation. </I>If we liquidate or dissolve, the holders of each outstanding share of our common
stock will be entitled to share equally in our assets legally available for distribution to our
shareholders after payment of all liabilities and after distributions to holders of preferred stock
legally entitled to be paid distributions prior to the payment of distributions to holders of our
common stock. As of the date of this prospectus, we have not issued any preferred stock with
preferential liquidation rights over our common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Warrants</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus includes 130% of the number of shares of our common stock issuable upon the
exercise of the warrants which have an exercise price of $7.50 per share and expire in February
2013. The exercise price and the amount of securities issuable pursuant to these warrants are
subject to adjustment as may be required to prevent dilution resulting from, among other things,
stock splits, stock dividends or similar events or the issuance of shares of our common stock at
prices below the exercise price of the warrants. The warrants were issued to the selling
shareholder in connection with an affiliate of the selling shareholder providing a $50&nbsp;million
financing facility to us in February&nbsp;2006. We have since paid off the financing facility in full.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Certain Provisions in Governance Documents</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The rights of holders of our common stock may become subject in the future to prior and
superior rights and preferences in the event our board of directors establishes one or more
additional classes of common stock, or one or more series of preferred stock. Such additional
classes or series may be established by our board of directors at the time of issuance without
further action by our shareholders. The issuance of a class or series of preferred stock could also
prevent a potential takeover because the terms of any issued preferred stock may require the
approval of the holders of the outstanding shares of preferred stock in order to consummate a
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">merger, reorganization or sale of substantially all of our assets or other extraordinary corporate
transaction.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our articles of incorporation provide that no person or entity may become the beneficial owner
of five percent or more of any class or series of our capital stock unless such person or entity
agrees in writing to provide personal background and financial information to gaming authorities,
consent to a background investigation, and respond to questions from gaming authorities. Our
articles of incorporation also provide that we may redeem, at fair market value, shares of our
capital stock held by any person or entity whose status as a shareholder, in the opinion of our
board of directors, jeopardizes the approval, continued existence, or renewal by any gaming
regulatory authority, of a contract to manage gaming operations, or any other tribal, federal or
state license or franchise held by us or any of our subsidiaries. These restrictions will be
contained in a legend on each certificate issued evidencing shares of our common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Minnesota Business Corporation Act</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have not opted out of the control share acquisition or business combination provisions of
the Minnesota Business Corporation Act. In general, the control share acquisition provision
provides that shares of our voting capital stock acquired in a &#147;control share acquisition&#148; have no
voting rights unless voting rights are approved by disinterested shareholders in a prescribed
manner. A &#147;control share acquisition&#148; is an acquisition, directly or indirectly, of the beneficial
ownership of shares of voting capital stock that would, when added to all other shares beneficially
owned by the acquiring person, exceed 20% or more of our outstanding voting capital stock entitled
to vote for the election of directors, subject to certain exceptions. In general, the business
combination provision prohibits any business combination by us or our subsidiary with any
shareholder that purchases 10% or more of our voting capital stock within four years following the
date such interested shareholder first held 10% or more of our voting capital stock, referred to as
the share acquisition date, unless the business combination is approved by a committee of all the
disinterested members of our board of directors before the interested shareholder&#146;s share
acquisition date. These provisions may have the effect of delaying, deferring or preventing a
change in control of us or the removal of our existing management. We have no control over, and
therefore can not predict, what effect these impediments to the ability of third parties to acquire
control of us might have on the market price of our common stock.
</DIV>

<DIV align="left">
<A name="107"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PLAN OF DISTRIBUTION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are registering the shares of common stock issuable upon conversion of the preferred shares
and upon exercise of the warrants to permit the resale of these shares of common stock by the
holders of the preferred shares and warrants from time to time after the date of this prospectus.
We will not receive any of the proceeds from the sale by the selling shareholder of the shares of
common stock. We will bear all fees and expenses incident to our obligation to register the shares
of common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The selling shareholder may sell all or a portion of the shares of common stock beneficially
owned by it and offered hereby from time to time directly or through one or more
underwriters, broker-dealers or agents. If the shares of common stock are sold through
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">underwriters or broker-dealers, the selling shareholder will be responsible for underwriting
discounts or commissions or agent&#146;s commissions. The shares of common stock may be sold in one or
more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying
prices determined at the time of sale, or at negotiated prices. These sales may be effected in
transactions, which may involve crosses or block transactions,
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>on any national securities exchange or quotation service on which the securities may
be listed or quoted at the time of sale;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in the over-the-counter market;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in transactions otherwise than on these exchanges or systems or in the
over-the-counter market;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>through the writing of options, whether such options are listed on an options
exchange or otherwise;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>ordinary brokerage transactions and transactions in which the broker-dealer solicits
purchasers;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>block trades in which the broker-dealer will attempt to sell the shares as agent but
may position and resell a portion of the block as principal to facilitate the
transaction;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>purchases by a broker-dealer as principal and resale by the broker-dealer for its
account;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>an exchange distribution in accordance with the rules of the applicable exchange;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>privately negotiated transactions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>settlement of short sales entered into after the date of this prospectus;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>sales pursuant to Rule&nbsp;144;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>broker-dealers may agree with the selling securityholders to sell a specified number
of such shares at a stipulated price per share;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a combination of any such methods of sale; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>any other method permitted pursuant to applicable law.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the selling shareholder effects such transactions by selling shares of common stock to or
through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may
receive commissions in the form of discounts, concessions or commissions from the selling
shareholder or commissions from purchasers of the shares of common stock for whom they may act as
agent or to whom they may sell as principal (which discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those customary in the
types of transactions involved). In connection with sales of the shares of common stock or
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">otherwise, the selling shareholder may enter into hedging transactions with broker-dealers, which
may in turn engage in short sales of the shares of common stock in the course of hedging in
positions they assume. The selling shareholder may also sell shares of common stock short and
deliver shares of common stock covered by this prospectus to close out short positions and to
return borrowed shares in connection with such short sales. The selling shareholder may also loan
or pledge shares of common stock to broker-dealers that in turn may sell such shares.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The selling shareholder may pledge or grant a security interest in some or all of the
preferred shares and warrants or shares of common stock owned by it and, if it defaults in the
performance of its secured obligations, the pledgees or secured parties may offer and sell the
shares of common stock from time to time pursuant to this prospectus or any amendment to this
prospectus under Rule&nbsp;424(b)(3) or other applicable provision of the Securities Act of 1933, as
amended, referred to as the Securities Act, amending, if necessary, the list of selling
shareholders to include the pledgee, transferee or other successors in interest as selling
shareholders under this prospectus. The selling shareholder also may transfer and donate the
shares of common stock in other circumstances in which case the transferees, donees, pledgees or
other successors in interest will be the selling beneficial owners for purposes of this prospectus.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The selling shareholder and any broker-dealer participating in the distribution of the shares
of common stock may be deemed to be &#147;underwriters&#148; within the meaning of the Securities Act, and
any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be
deemed to be underwriting commissions or discounts under the Securities Act. At the time a
particular offering of the shares of common stock is made, a prospectus supplement, if required,
will be distributed which will set forth the aggregate amount of shares of common stock being
offered and the terms of the offering, including the name or names of any broker-dealers or agents,
any discounts, commissions and other terms constituting compensation from the selling shareholder
and any discounts, commissions or concessions allowed or reallowed or paid to broker-dealers.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the securities laws of some states, the shares of common stock may be sold in such
states only through registered or licensed brokers or dealers. In addition, in some states the
shares of common stock may not be sold unless such shares have been registered or qualified for
sale in such state or an exemption from registration or qualification is available and is complied
with.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There can be no assurance that any selling shareholder will sell any or all of the shares of
common stock registered pursuant to the shelf registration statement, of which this prospectus
forms a part.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The selling shareholder and any other person participating in such distribution will be
subject to applicable provisions of the Securities Exchange Act of 1934, as amended (referred to as
the Exchange Act), and the rules and regulations thereunder, including, without limitation,
Regulation&nbsp;M of the Exchange Act, which may limit the timing of purchases and sales of any of the
shares of common stock by the selling shareholder and any other participating person. Regulation&nbsp;M
may also restrict the ability of any person engaged in the distribution of the shares of common
stock to engage in market-making activities with respect to the shares of common
stock. All of the foregoing may affect the marketability of the shares of common stock and
the
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">ability of any person or entity to engage in market-making activities with respect to the
shares of common stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will pay all expenses of the registration of the shares of common stock pursuant to the
registration rights agreement; provided, however, that a selling shareholder will pay all
underwriting discounts and selling commissions, if any. We will indemnify the selling shareholder
against liabilities, including liabilities under the Securities Act, in accordance with the
registration rights agreement, or the selling shareholder will be entitled to contribution. We may
be indemnified by the selling shareholder against civil liabilities, including liabilities under
the Securities Act, that may arise from any written information furnished to us by the selling
shareholder specifically for use in this prospectus, in accordance with the related registration
rights agreement, or we may be entitled to contribution.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Once sold under the shelf registration statement, of which this prospectus forms a part, the
shares of common stock will be freely tradable in the hands of persons other than our affiliates.
</DIV>

<DIV align="left">
<A name="108"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>LEGAL MATTERS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The validity of our common stock offered by this prospectus will be passed upon for us by
Gray, Plant, Mooty, Mooty &#038; Bennett, P.A.
</DIV>

<DIV align="left">
<A name="109"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXPERTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The financial statements as of January&nbsp;1, 2006 and for the year then ended incorporated into
this prospectus by reference from our Annual Report on Form 10-K for the year ended January&nbsp;1, 2006
have been audited by Piercy, Bowler, Taylor &#038; Kern, Certified Public Accountants and Business
Advisors a Professional Corporation, referred to as Piercy Bowler Taylor &#038; Kern, an independent
registered public accounting firm, as stated in their report, which is incorporated herein by
reference, and has been so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The financial statements as of January&nbsp;2, 2005 and for each of the two years in the period
then ended incorporated in this prospectus by reference from our Annual Report on Form 10-K for the
year ended January&nbsp;1, 2006 have been audited by Deloitte &#038; Touche LLP, an independent registered
public accounting firm, as stated in their report, which is incorporated herein by reference, and
have been so incorporated in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing.
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="110"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>WHERE YOU CAN FIND MORE INFORMATION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We file annual, quarterly and current reports, proxy statements and other information with the
Securities and Exchange Commission, referred to as the SEC. The reports, proxy statements and other
information that we file electronically with the SEC are available to the public free of charge
over the Internet at the SEC&#146;s website at <U>http://www.sec.gov</U>. You may also read and copy
any document we file with the SEC, at prescribed rates, at the SEC&#146;s Public Reference Room at 100 F
Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the SEC&#146;s
Public Reference Room by calling the SEC at 1-800-SEC-0330.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We &#147;incorporate by reference&#148; into this prospectus certain information that we have filed with
the SEC, which means that we can disclose important information to you by referring you to those
documents. The information incorporated by reference is an important part of this prospectus. The
information about us that is contained in this prospectus is not comprehensive and you should also
read the information in the documents incorporated by reference into this prospectus. We
incorporate by reference into this prospectus the reports and documents listed below and any future
filings we will make with the SEC under Sections&nbsp;13(a), 13(c), 14 or 15(d) of the Exchange Act,
other than current reports on Form 8-K furnished under Item&nbsp;2.02 or Item&nbsp;7.01 of Form 8-K and
exhibits filed on such form that are related to such items, until the termination of the offering
covered by this prospectus:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Annual Report on Form 10-K for the year ended January&nbsp;1, 2006 (including information
specifically incorporated by reference into our Form 10-K), as filed with the SEC on March
8, 2006; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Proxy Statement dated March&nbsp;17, 2006 as filed with the SEC on March&nbsp;8, 2006; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Quarterly Report on Form 10-Q for the quarterly period ended April&nbsp;2, 2006 as filed
with the SEC on May&nbsp;12, 2006 (including our unaudited interim financial statements as of
April&nbsp;2, 2006, and for the three-month periods ended April&nbsp;2, 2006, and April&nbsp;3, 2005); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Quarterly Report on Form 10-Q for the quarterly period ended July&nbsp;2, 2006 as filed
with the SEC on August&nbsp;10, 2006 (including our unaudited interim financial statements as of
July&nbsp;2, 2006, and for the three-month and six-month periods ended July&nbsp;2, 2006 and July&nbsp;3,
2005); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Quarterly Report on Form 10-Q for the quarterly period ended October&nbsp;1, 2006 as
filed with the SEC on November&nbsp;9, 2006 (including our unaudited interim financial
statements as of October&nbsp;1, 2006, and for the three-month and nine-month periods ended
October&nbsp;1, 2006 and October&nbsp;2, 2005); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Current Reports on Forms 8-K as filed with the SEC on March&nbsp;22, 2006, March&nbsp;23,
2006, April&nbsp;5, 2006, April&nbsp;7, 2006 (reporting disclosures under Items 1.01 and 1.02), April
21, 2006, June&nbsp;28, 2006, October&nbsp;4, 2006, October&nbsp;6, 2006, November&nbsp;9, 2006, December&nbsp;6,
2006, December&nbsp;14, 2006; December&nbsp;27, 2006; January&nbsp;9, 2007; and</TD>
</TR>
<TR><TD><DIV align="left"><FONT size="1">

</FONT></DIV></TD></TR>
</TABLE>
</DIV>
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<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The description of our common stock contained in our registration statement on Form&nbsp;10
registering our common stock under Section&nbsp;12 of the Exchange Act as filed with the SEC on
October&nbsp;23, 1998, as amended by our registration statement on Form 8-A/A as filed with the
SEC on May&nbsp;16, 2000.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will provide to each person, including any beneficial owner, to whom a prospectus is
delivered, a copy of any or all of the above reports and documents which are incorporated by
reference into this prospectus but not delivered with the prospectus. You can make a written or
oral request for a free copy of any or all of the above reports and documents by writing to Timothy
J. Cope, our President and Chief Financial Officer, at 130 Cheshire Lane, Suite&nbsp;101, Minnetonka, MN
55305; or by emailing Mr.&nbsp;Cope at
<u>tcope@lakesentertainment.com</u>; or by telephoning Mr.
Cope at (952)&nbsp;449-9092.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The address of our website is <U>http://www.lakesentertainment.com</U>. Our most current SEC
filings, such as our annual, quarterly and current reports, proxy statements and press releases,
including the reports and documents that are incorporated by reference into this prospectus, are
available to the public free of charge on our website. Our website is not a part of this
prospectus.
</DIV>

<DIV align="left">
<A name="111"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>INDEMNIFICATION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are subject to the Minnesota Business Corporation Act, referred to as the MBCA. Section
302A.521 of the MBCA provides that we shall indemnify a person made or threatened to be made a
party to a proceeding by reason of the former or present official capacity of such person against
judgments, penalties, fines, including, without limitation, excise taxes assessed against such
person with respect to any employee benefit plan, settlements and reasonable expenses, including
attorneys&#146; fees and disbursements, incurred by such person in connection with the proceeding, if,
with respect to the acts or omissions of such person complained of in the proceeding, such person:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>has not been indemnified by another organization or employee benefit plan for the
same judgments, penalties, fines, including, without limitation, excise taxes assessed
against the person with respect to an employee benefit plan, settlements, and
reasonable expenses, including attorneys&#146; fees and disbursements, incurred by the
person in connection with the proceeding with respect to the same acts or omissions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>acted in good faith;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>received no improper personal benefit and Section&nbsp;302A.255 of the MBCA, if
applicable, has been satisfied;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in the case of a criminal proceeding, had no reasonable cause to believe the conduct
was unlawful; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>reasonably believed that the conduct was in our best interests in the case of acts
or omissions in such person&#146;s official capacity for us or reasonably believed that the</TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->28<!-- /Folio -->
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>conduct was not opposed to our best interests in the case of acts or omissions in such
person&#146;s official capacity for other affiliated organizations.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Article&nbsp;7 of our articles of incorporation further provide that our directors shall not be
personally liable to us or our shareholders for breaches of fiduciary duty. In addition, Article&nbsp;6
of our Bylaws provides that we shall indemnify our directors to the fullest extent permitted under
the MBCA. We also maintain a director and officer insurance policy to cover ourselves, our
directors and our officers against certain liabilities.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although indemnification for liabilities arising under the Securities Act of 1933, referred to
as the Securities Act, may be permitted to our directors, officers and controlling persons under
these provisions, we have been advised that, in the opinion of the SEC, such indemnification is
against public policy as expressed in the Securities Act and is, therefore, unenforceable.
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->29<!-- /Folio -->
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 12pt; margin-top: 18pt"><B>1,625,000 Shares</B>
</DIV>


<DIV align="Center" style="font-size: 18pt; margin-top: 6pt"><B>LAKES ENTERTAINMENT, INC.</B>

</DIV>

<DIV align="Center" style="font-size: 12pt; margin-top: 6pt"><B>Common Stock</B>

</DIV>

<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>

<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>PROSPECTUS</B><BR>
<DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>

<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> <B>&#95;&#95;&#95;, 2007</B>

</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PART II</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>INFORMATION NOT REQUIRED IN PROSPECTUS</B>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;14. Other Expenses of Issuance and Distribution</B><B><I>.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the various expenses in connection with the issuance and
registration of the securities being registered pursuant to this Registration Statement on Form
S-3. All of the amounts shown are estimates, except for the United States Securities and Exchange
Commission registration fee and the Nasdaq fee.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Securities and Exchange Commission registration fee</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,875</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Printing expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Legal fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounting and auditing fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Nasdaq fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,250</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Transfer Agent and Registrar fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Miscellaneous</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">137,225</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;15. Indemnification of Directors and Officers.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are subject to the Minnesota Business Corporation Act (the &#147;MBCA&#148;). Section&nbsp;302A.521 of
the MBCA provides that we shall indemnify a person made or threatened to be made a party to a
proceeding by reason of the former or present official capacity of such person against judgments,
penalties, fines, including, without limitation, excise taxes assessed against such person with
respect to any employee benefit plan, settlements and reasonable expenses, including attorneys&#146;
fees and disbursements, incurred by such person in connection with the proceeding, if, with respect
to the acts or omissions of such person complained of in the proceeding, such person:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>has not been indemnified by another organization or employee benefit plan for the
same judgments, penalties, fines, including, without limitation, excise taxes assessed
against the person with respect to an employee benefit plan, settlements, and
reasonable expenses, including attorneys&#146; fees and disbursements, incurred by the
person in connection with the proceeding with respect to the same acts or omissions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>acted in good faith;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>received no improper personal benefit and Section&nbsp;302A.255 of the MBCA, if
applicable, has been satisfied;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in the case of a criminal proceeding, had no reasonable cause to believe the
conduct was unlawful; and</TD>
</TR>

</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->II-1<!-- /Folio -->



</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>reasonably believed that the conduct was in our best interests in the case of acts
or omissions in such person&#146;s official capacity for us or reasonably believed that the
conduct was not opposed to our best interests in the case of acts or omissions in such
person&#146;s official capacity for other affiliated organizations.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Article&nbsp;7 of our articles of incorporation further provide that our directors shall not be
personally liable to us or our shareholders for breaches of fiduciary duty. In addition, Article&nbsp;6
of our Bylaws provides that we shall indemnify our directors to the fullest extent permitted under
the MBCA.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also maintain a director and officer insurance policy to cover ourselves, our directors and
our officers against certain liabilities.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;16. Exhibits and Financial Statement Schedules.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>(a)&nbsp;Exhibits:</B>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibits</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Description</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Articles of Incorporation of Lakes Entertainment, Inc. (as
amended through May&nbsp;5, 2004). (Incorporated herein by
reference to Exhibit&nbsp;3.1 to Lakes&#146; Report on Form&nbsp;10-Q for
the fiscal quarter ended April&nbsp;4, 2004.)</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Lakes Entertainment, Inc. Certificate of Designation of
Series&nbsp;A Convertible Preferred Stock dated February&nbsp;21, 2006.
(Incorporated herein by reference to Exhibit&nbsp;3.1 to Lakes&#146;
Current Report on Form&nbsp;8-K filed with the Commission on
February&nbsp;22, 2006.).</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By-laws of Lakes Gaming, Inc. (Incorporated herein by
reference to Exhibit&nbsp;3.2 to the Lakes Form&nbsp;10.)</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Rights Agreement, dated as of May&nbsp;12, 2000, between Lakes
Gaming, Inc. and Norwest Bank Minnesota, National
Association, as Rights Agent. (Incorporated herein by
reference to Exhibit&nbsp;4.1 to Lakes&#146; Form&nbsp;8-K filed May&nbsp;6,
2000.)</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">5.1&#134;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Opinion of Gray, Plant, Mooty, Mooty &#038; Bennett, P.A.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Securities Purchase Agreement dated as of February&nbsp;15, 2006
between Lakes Entertainment, Inc. and PLKS Holdings, LLC
including the Schedule of Buyers. (Incorporated herein by
reference to Exhibit&nbsp;10.2 to Lakes&#146; Current Report on Form
8-K filed with the Commission on February&nbsp;22, 2006.).</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Registration Rights Agreement dated as of February&nbsp;15, 2006
between Lakes Entertainment, Inc. and PLKS Holdings, LLC
including schedules and exhibits thereto. (Incorporated
herein by reference to Exhibit&nbsp;10.3 to Lakes&#146; Current Report
on Form&nbsp;8-K filed with the Commission on February&nbsp;22, 2006.).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->II-2<!-- /Folio -->


</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>


<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="6">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibits</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Description</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Common Stock Purchase Warrant dated February&nbsp;15, 2006 by
Lakes Entertainment, Inc. in favor of PLKS Holdings, LLC.
(Incorporated herein by reference to Exhibit&nbsp;10.4 to Lakes&#146;
Current Report on Form&nbsp;8-K filed with the Commission on
February&nbsp;22, 2006.).</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Deloitte &#038; Touche LLP.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.2*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Piercy Bowler Taylor &#038; Kern.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.3&#134;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Gray, Plant, Mooty, Mooty &#038; Bennett, P.A.
(included in Exhibit&nbsp;5.1).</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">24&#134;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Power of Attorney (included on signature page to the
Registration Statement on Form&nbsp;S-3 filed by Lakes with the
Securities and Exchange Commission on January&nbsp;3, 2007).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>


<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">&#134;</TD>
    <TD>&nbsp;</TD>
    <TD>Previously filed.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Filed herewith.</TD>
</TR>
</TABLE>
<DIV align="left"><FONT size="1">

</FONT></DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>(b)&nbsp;Financial Statement Schedules</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Incorporated by reference to the financial statement schedules included in the 2005 Form 10-K.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;17. Undertakings.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">a. The undersigned registrant hereby undertakes:

</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(i)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To include any prospectus required by Section&nbsp;10(a)(3) of the
Securities Act of 1933;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(ii)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no
more than 20% change in the maximum aggregate offering price set forth in the
&#147;Calculation of Registration Fee&#148; table in the effective registration
statement;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(iii)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or</TD>
</TR>

</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->II-3<!-- /Folio -->


</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>any material change to such information in the registration statement;</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>PROVIDED, HOWEVER, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section
do not apply if the information required to be included in the post-effective amendment by
those paragraphs is contained in reports filed with or furnished to the Commission by the
registrant pursuant to Section&nbsp;13 of 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement, or is contained in the form of
prospectus filed pursuant to Rule 424(b) that is part of the registration statement.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>That, for purposes of determining any liability under the Securities Act of
1933, each filing of the registrant&#146;s annual report pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan&#146;s annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">b. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy as expressed in
the Act and is, therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person in connection with
the securities being registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->II-4<!-- /Folio -->


</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="112"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it
has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and
has duly caused this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Minnetonka, State of Minnesota, on January&nbsp;29, 2007.
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="48%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="46%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">LAKES ENTERTAINMENT, INC.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Registrant</I></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Lyle Berman</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Name:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Lyle Berman</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Title:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chairman of the Board and</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chief Executive Officer</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Dated as of January&nbsp;29, 2007</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>




<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->II-5<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed below by the following persons on behalf of the registrant and in the capacities
indicated and on the dates indicated:
</DIV>


<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="33%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="38%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Name</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Title</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Date</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR><TD align="left" valign="top">&nbsp;</TD></TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Lyle Berman
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Chairman of the Board and Chief Executive
Officer<BR>
(Principal Executive Officer)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Timothy J. Cope
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Chief Financial Officer and Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Timothy J. Cope
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Principal Financial and Accounting Officer)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Morris Goldfarb</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Larry C. Barenbaum</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ray Moberg</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Neil I. Sell</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">January&nbsp;29, 2007</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Richard White</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="46%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">*By
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Timothy J. Cope</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Timothy J. Cope
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Attorney-in-fact</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->II-6<!-- /Folio -->
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>2
<FILENAME>c10767a1exv23w1.htm
<DESCRIPTION>CONSENT OF DELOITTE & TOUCHE LLP
<TEXT>
<HTML>
<HEAD>
<TITLE>exv23w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit&nbsp;23.1
</DIV>




<DIV align="left" style="font-size: 10pt; margin-top: 12pt">CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We consent to the incorporation by reference in Amendment No.&nbsp;1 to Registration Statement File Nos.
333-77247, 333-77249, 333-77591 on Form S-3 of our report dated November&nbsp;30, 2005 relating to the
consolidated financial statements of Lakes Entertainment, Inc. as of January&nbsp;2, 2005 and for each
of the two years in the period then ended, appearing in the Annual Report on Form 10-K of Lakes
Entertainment, Inc. for the year ended January&nbsp;1, 2006, which is part of this Registration
Statement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We also consent to the reference to us under the heading &#147;Experts&#148; in the Prospectus, which is a
part of this Registration Statement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">/s/ Deloitte &#038; Touche LLP
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Minneapolis, Minnesota<BR>
January&nbsp;25, 2007

</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio --><!-- /Folio -->
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.2
<SEQUENCE>3
<FILENAME>c10767a1exv23w2.htm
<DESCRIPTION>CONSENT OF PIERCY BOWLER TAYLOR & KERN
<TEXT>
<HTML>
<HEAD>
<TITLE>exv23w2</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit&nbsp;23.2
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Board of Directors<BR>
Lakes Entertainment, Inc.<BR>
Minnetonka, Minnesota

</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We consent to the incorporation by reference in this Registration Statement on Form&nbsp;S-3 (No.
333-139783) of Lakes Entertainment, Inc. (the Company) of our reports dated February&nbsp;17, 2006,
which appear on pages 73 and 116 of the Company&#146;s annual report on Form 10-K for the year ended
January&nbsp;1, 2006. We also consent to the reference to our Firm under the caption &#147;Experts&#148; in the
Prospectus, which is a part of this Registration Statement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">/s/ Piercy Bowler Taylor &#038; Kern
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Piercy, Bowler, Taylor &#038; Kern<BR>
Certified Public Accountants and Business Advisors<BR>
A Professional Corporation

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">January&nbsp;29, 2007
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>


</BODY>
</HTML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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