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Casino Queen Inc – Company Profile and News

Casino Queen Inc is the owner of a vibrant casino and hotel along the Mississippi River in East St. Louis, Illinois, and also a full-service RV park.

The property recently partnered with Boston-based DraftKings to bring a sportsbook app and retail presence to the state of Illinois.

The company has also enlisted Voltus to enroll 2.2 megawatts of flexible load in a demand response program. This will generate revenue for the property to reduce its energy usage during times of grid strain and supply imbalances.

Company Profile

Casino Queen Inc is the operator of a locals-oriented casino, hotel and entertainment complex in East St. Louis, Illinois. The property includes a 40,000 square foot gaming floor with over 1,100 slot machines and 27 table games; a 157 room hotel; three restaurants; 6,250 square feet of meeting space and 132-space recreational vehicle park.

The Company’s employee management group operates the Property under an Employee Stock Ownership Plan (“ESOP”), which provides employees with a collective ownership interest in the Property. The ESOP allows the Company to provide enhanced retirement benefits for its employees and generate liquidity for them as they retire or leave the Company.

The lawsuit was filed by ex-staffers claiming that the former board members of Casino Queen dumped shares of the gaming company’s equity into an employee retirement plan at artificially high prices. The suit also alleged that the plaintiffs and their colleagues have been subjected to an unlawful de facto transfer of the Property under a non-competitive lease agreement with Gaming and Leisure Properties, LLC (GLPI).

Financials

The casino has been welcoming visitors since 1993. In addition to the DraftKings sportsbook, Casino Queen also offers an array of gaming machines and table games.

Earlier this month, the company hired a new president to oversee all of its operations, including the casino in East St. Louis and a property in Marquette, Iowa.

Hanger, who has been general manager of the riverboat casino for 18 years, took over from Jeff Watson. He resigned to become an associate judge in the Illinois 20th Judicial Circuit.

He was part of the team that led shareholders through the sale of their interest in the company to a newly formed Employee Stock Ownership Plan for approximately $170 million. That transition allowed Casino Queen to become the first employee-owned and locally owned casino in the country.

Regulatory Compliance

Casino Queen operates a locals-oriented casino and hotel situated along the Mississippi River in East St. Louis, Missouri. Its facilities include a 40,000 square foot gaming floor, 157 room hotel, three restaurants, 6,250 square feet of meeting space and a 132-space recreational vehicle park.

According to the company’s website, it also maintains relationships with professional sports teams in Missouri. Its advertising and promotional campaigns are extensive. Its advertising includes radio, television and print media ads, as well as direct mailings targeting residents of Missouri.

In 2012, shareholders of Casino Queen established a holding company, exchanged their own shares for that of the holding company, and set up an employee ownership plan. In December 2012, the plan borrowed $170 million to purchase the holding company’s shares. The plaintiffs allege that the sale violated ERISA’s fiduciary duties because it paid more than fair market value for the company’s equity. Moreover, the lawsuit claims the plan’s trustees lied about the stock plan’s debt to the labor department and relinquished their membership in the holding company.

Media Coverage

The company operates Casino Queen Hotel & Casino, a locals-oriented casino and entertainment complex in East St. Louis, Illinois.

The property features a 40,000 square-foot gaming floor with 1,100 slot machines and 27 table games. It also has a 157 room hotel and three restaurants.

A 6,000-square-foot sports betting facility was opened across the Mississippi River from the casino. NFL Hall of Famer Marshall Faulk cut the ribbon for the event, which allows fans to place bets on their favorite teams and athletes.

Two former employees filed suit against the Casino Queen’s former owners for allegedly selling their stake in the property into an employee stock ownership plan (ESOP) at a vastly inflated price and keeping the true value secret for years.

An Illinois federal judge rejected a motion to dismiss a lawsuit filed by ex-staffers who claim the company’s board members dumped shares of their equity into an employee retirement plan at artificially high prices. The suit names several family members of the casino’s founders and trusts established for their benefit as defendants.

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