1.DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Century Casinos, Inc. (“CCI” or the “Company”) is an international casino entertainment company. As of December 31, 2015, the Company owned casino operations in North America; held a majority ownership interest in nine casinos throughout Poland, a racetrack and entertainment center (“REC”) in Canada and the pari-mutuel off-track betting network in southern Alberta, Canada; managed cruise ship-based casinos on international waters; managed a casino in Aruba and provided gaming services in Argentina.

The Company currently owns, operates and manages the following casinos through wholly-owned subsidiaries in North America:

The Century Casino & Hotel in Edmonton, Alberta, Canada

The Century Casino Calgary, Alberta, Canada

The Century Casino & Hotel in Central City, Colorado; and

The Century Casino & Hotel in Cripple Creek, Colorado

The Company currently has a controlling financial interest through its subsidiary Century Casinos Europe GmbH (“CCE”) in the following majority-owned subsidiaries:

The Company owns 66.6% of Casinos Poland Ltd. (“CPL” or “Casinos Poland”). CPL is the owner and operator of nine casinos throughout Poland. CPL is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. Polish Airports Company (“Polish Airports”) owns the remaining 33.3% of CPL, which is reported as a non-controlling financial interest.

The Company owns 75% of United Horsemen of Alberta Inc. dba Century Downs Racetrack and Casino ("CDR" or “Century Downs”). CDR operates Century Downs Racetrack and Casino, a REC in Balzac, a north metropolitan area of Calgary, Alberta, Canada. CDR is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. The remaining 25% is owned by unaffiliated shareholders and is reported as a non-controlling financial interest. The casino at CDR opened in April 2015 and the 2015 horse racing season was from April to November. See Note 3 for additional information related to CDR.

The Company owns 75% of Century Bets! Inc. (“CBS” or “Century Bets”) and CBS is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. Rocky Mountain Turf Club (“RMTC”) owns the remaining 25% of CBS, which is reported as a non-controlling financial interest. CBS began operating the pari-mutuel off-track betting network in southern Alberta in May 2015.

The Company has the following concession, management and consulting service agreements:

The Company has concession agreements to operate 10 ship-based casinos onboard TUI Cruises and Windstar Cruises. In 2015, the Company began operating the ship-based casinos onboard the following three newly launched cruise ships: Windstar Cruises Star Breeze and Star Legend and TUI Cruises Mein Schiff 4. In addition, in 2015 the Company amended its concession agreement with TUI Cruises to include its operation of the ship-based casino onboard the Mein Schiff 5 and Mein Schiff 6, two new 2,500 passenger ships that are scheduled to commence operations in 2016 and 2017, respectively. The Company’s agreement with Nova Star Cruises Ltd. to operate a ship-based casino onboard the Nova Star, a round trip cruise ferry service connecting Portland, Maine to Yarmouth, Nova Scotia, ended in October 2015 after the 2015 sailing season.

In March 2015, the Company mutually agreed with Norwegian Cruise Line Holdings (“Norwegian”) to terminate its concession agreements with Oceania Cruises (“Oceania”) and Regent Seven Seas Cruises (“Regent”), indirect subsidiaries of Norwegian, effective June 1, 2015 (the “Termination Agreement”). The Company transitioned operations of the eight ship-based casinos that it operated onboard Oceania and Regent vessels to Norwegian in the second quarter of 2015. As consideration for the early termination of the concession agreements, the Company received $4.0 million in June 2015 and recorded this amount on its consolidated statement of earnings (loss) under operating revenue net of $0.6 million related to assets that were sold to Norwegian as part of the Termination Agreement.

The Company also entered into a two-year consulting agreement, which became effective on June 1, 2015, under which the Company is providing limited consulting services for the ship-based casinos of Oceania and Regent in exchange for receiving a consulting fee of $2.0 million, which is payable $250,000 per quarter.

The Company has a long-term management agreement to direct the operation of the casino at the Hilton Aruba Caribbean Resort and Casino, which was formerly the Radisson Aruba Resort, Casino & Spa until it was sold and rebranded in 2015. The management agreement was assumed by the new owners and no changes were made to the original agreement from which the Company receives a monthly management fee.

The Company, through its subsidiary CCE, has a 7.5% ownership interest in Mendoza Central Entretenimientos S.A, an Argentina company (“MCE”). The shares are reported on the consolidated balance sheet using the cost method of accounting. MCE has an exclusive concession agreement with Instituto Provincial de Juegos y Casinos to lease slot machines and provide related services to Casino de Mendoza, a casino located in Mendoza, Argentina and owned by the Province of Mendoza. In addition, CCE and MCE have entered into a consulting services agreement pursuant to which CCE provides advice on casino matters and receives a service fee consisting of a fixed fee plus a percentage of MCE’s earnings before interest, taxes, depreciation and amortization (“EBITDA”). See Note 4 for additional information related to MCE.