Diamondhead Casino (DHCC) 10-Q 17 May 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	May 10, 2017
Details
Registrant Name	DIAMONDHEAD CASINO CORP
Registrant CIK	844,887
SEC Form	10-Q
Period End date	Mar. 31, 2017
Fiscal Year End	--12-31
Trading Symbol	dhcc
Tax Identification Number (TIN)	592,935,476
Number of common stock shares outstanding		36,297,576
Filer Category	Smaller Reporting Company
Current with reporting	Yes
Voluntary filer	No
Well-known Seasoned Issuer	No
Amendment Flag	false
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	FY
Contained File Information, File Number	0-17529
Entity Incorporation, State Country Name	Delaware
Entity Address, Address Line One	1013 Princess Street
Entity Address, City or Town	Alexandria
Entity Address, State or Province	Virginia
Entity Address, Postal Zip Code	22,314
City Area Code	703
Local Phone Number	683-6800

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Current assets
Cash	$ 3,742	$ 17,606
Other current assets	2,896	352
Total current assets	6,638	17,958
Land held for development (Note 3)	5,476,097	5,476,097
Deferred financing costs (net of amortization of $103,214 at March 31, 2017 and $93,918 at December 31, 2016)	97,886	107,182
Other assets	80	80
Total assets	5,580,701	5,601,317
Current liabilities
Notes and line of credit payable (Note 5)	1,962,500	1,962,500
Debenture payable (net of unamortized discount of $44,323 at March 31, 2017 and $45,252 at December 31, 2016) (Note 6)	5,677	4,748
Convertible debentures payable (net of unamortized discount of $1,635,121 at March 31, 2017 and $1,662,041 at December 31, 2016) (Note 6)	164,879	137,959
Derivative liability (Note 6)	1,817,631	2,030,289
Interest bearing advance (Note 7)	25,000	0
Short term note	2,178	0
Accounts payable and accrued expenses due related parties (Note 4)	2,928,665	2,772,164
Accounts payable and accrued expenses - other (Note 4)	2,107,105	2,012,526
Total current liabilities	9,013,635	8,920,186
Notes payable due related parties (Note 8)	115,000	115,000
Notes payable due others (Note 8)	22,500	22,500
Total liabilities	9,151,135	9,057,686
Stockholders' deficiency
Preferred stock, $.01 par value; shares authorized 5,000,000, outstanding 2,086,000 at March 31, 2017 and December 31, 2016 (aggregate liquidation preference of $2,519,080 at March 31, 2017 and December 31, 2016).	20,860	20,860
Common stock, $.001 par value; shares authorized 50,000,000, issued: 39,052,472 at March 31, 2017 and December 31, 2016, outstanding: 36,297,576 at March 31, 2017 and December 31, 2016.	39,052	39,052
Additional paid-in capital	35,643,373	35,643,373
Unearned ESOP shares	(3,320,875)	(3,320,875)
Accumulated deficit	(35,807,333)	(35,693,268)
Treasury stock, at cost, 527,616 shares at March 31, 2017 and December 31, 2016	(145,511)	(145,511)
Total stockholders' deficiency	(3,570,434)	(3,456,369)
Total liabilities and stockholders' deficiency	$ 5,580,701	$ 5,601,317

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS - Parenthetical - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Deferred financing costs, amortization	$ 103,214	$ 93,918
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred Stock, Shares Authorized	5,000,000	5,000,000
Preferred Stock, Shares Outstanding	2,086,000	2,086,000
Preferred Stock, Liquidation Preference, Value	$ 2,519,080	$ 2,519,080
Common Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Common Stock, Shares Authorized	50,000,000	50,000,000
Common Stock, Shares, Issued	39,052,472	39,052,472
Common Stock, Shares, Outstanding	36,297,576	36,297,576
Treasury Stock, Shares	527,616
Corporate Debt Securities
Unamortized discount	$ 44,323	$ 45,252
Convertible Debt Securities
Unamortized discount	$ 1,635,121	$ 1,662,041

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
COSTS AND EXPENSES
Administrative and general	$ 161,285	$ 174,765
Amortization	9,296	9,296
Other	16,474	15,658
Total costs and expenses	187,055	199,719
OTHER INCOME (EXPENSE)
Amortization of debt discount	(27,849)	(13,652)
Interest expense	(107,184)	(100,103)
Change in fair value of derivative liability	212,658	(45,574)
Other income	20,765	0
Total other income (expense)	98,390	(159,329)
NET LOSS	(88,665)	(359,048)
PREFERRED STOCK DIVIDENDS	(25,400)	(25,400)
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS	$ (114,065)	$ (384,448)
Net loss per common share, basic and fully diluted	$ (0.003)	$ (0.01)
Weighted average number of common shares outstanding, basic and fully diluted	36,297,575	36,297,576

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
OPERATING ACTIVITIES
Net loss	$ (88,665)	$ (359,048)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization	9,296	9,296
Change in fair value of derivative liability	(212,658)	45,574
Amortization of debt discount	27,849	13,652
Change in assets and liabilities:
Other assets	(2,544)	(2,536)
Accounts payable and accrued expenses	225,680	236,532
Net cash used in operating activities	(41,042)	(56,530)
FINANCING ACTIVITIES
Proceeds from interest bearing advances	25,000	0
Proceeds from short term note	2,694	2,946
Payment of short term note	(516)	(273)
Proceeds from notes payable issued to related parties	0	25,000
Proceeds from notes payable issued to others	0	17,500
Net cash provided by financing activities	27,178	45,173
Net decrease in cash	(13,864)	(11,357)
Cash beginning of year	17,606	15,655
Cash end of year	3,742	4,298
Cash paid for interest	55	32
Non-cash financing activities:
Unpaid preferred stock dividends included in accounts payable and accrued expenses	$ 25,400	$ 25,400

Note 1. Organization and Busine

Note 1. Organization and Business	3 Months Ended
	Mar. 31, 2017
Notes
Note 1. Organization and Business	Note 1. Organization and Business Diamondhead Casino Corporation and Subsidiaries (the “Company”) own a total of approximately 404.5 acres of unimproved land in Diamondhead, Mississippi on which the Company plans, unilaterally, or in conjunction with one or more partners, to construct a casino resort and hotel and associated amenities.

Note 2. Liquidity and Going Con

Note 2. Liquidity and Going Concern	3 Months Ended
	Mar. 31, 2017
Notes
Note 2. Liquidity and Going Concern	Note 2. Liquidity and Going Concern These unaudited condensed consolidated financial statements have been prepared on the basis that the Company is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has no operations and generates no operating revenues. During the three months ended March 31, 2017 and 2016 the Company incurred net losses applicable to common shareholders, exclusive of the recording of change in the fair value of derivatives, of $326,723 and $338,874, respectively. The Company has had no operations since it ended its gambling cruise ship operations in 2000. Since that time, the Company has concentrated its efforts on the development of its Diamondhead, Mississippi Property. The development of the Diamondhead Property is dependent on obtaining the necessary capital, through equity and/or debt financing, unilaterally, or in conjunction with one or more partners, to master plan, design, obtain permits for, construct, staff, open, and operate a casino resort. In the past, in order to raise capital to continue to pay on-going costs and expenses, the Company has borrowed funds, through Private Placements of convertible instruments and other means, which are more fully described in Notes 5, 6, 7 and 8 to these unaudited condensed consolidated financial statements. Some of these instruments are past due for payment of both principal and interest. In addition, at March 31, 2017, the Company had current liabilities totaling $9,013,635 and only $3,742 cash on hand. The above conditions raise substantial doubt as to the Company’s ability to continue as a going concern.

Note 3. Summary of Significant

Note 3. Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2017
Notes
Note 3. Summary of Significant Accounting Policies	Note 3. Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements and, in our opinion, reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the three months ended March 31, 2017 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2016, attached as Exhibit 99.1 to our annual report on Form 10-K. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Diamondhead Casino Corporation and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Land Held for Development Land held for development is carried at cost. Costs directly related to site development, such as licenses, permitting, engineering, and other costs, are capitalized. Land development costs, which have been capitalized, consist of the following at March 31, 2017 and December 31, 2016: Land under development $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 Total land held for development $5,476,097 Fair Value Measurements The Company follows the provisions of ASC Topic 820 “Fair Value Measurements” for financial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. The standard discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Input other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable input that reflects The table listed below provides a reconciliation of the beginning and ending net balances for the derivative liability measured at fair value using significant unobservable inputs (Level 3) at March 31, 2017 and December 31, 2016: March 31, December 31, 2017 2016 Beginning balance $ 2,030,289 $ 1,704,570 Total unrealized (appreciation) depreciation (212,658) 325,719 Ending balance $ 1,817,631 $ 2,030,289 Sensitivity Analysis to Changes in Level 3 Assumptions Significant inputs include the dates when required conditions are expected to be met under the conversion terms of the debentures, the underlying market cap due to borrowings and losses and discount for lack of marketability while the stock was delisted and reversed when the Company's stock became publicly listed again on or about October 26, 2015. In addition, use of different ranges of bond discount rates and changes in historical volatility rates would also result in a higher or lower fair value. Current assets and current liabilities are financial instruments and management believes that their carrying amounts are reasonable estimates of their fair values due to their short term nature. The convertible debentures and derivative liability approximate fair value based on Level 3 inputs, as further discussed in Note 7. Long-Lived Assets The Company reviews long-lived assets whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of longlived assets is measured by comparing the carrying amount of the assets to the estimated undiscounted future cash flows projected to be generated by the assets. If such assets are considered impaired, the impairment to be recognized is measured by the amount the carrying value exceeds the fair value of such assets determined by appraisal, discounted cash flow projections, or other means. No impairment existed at March 31, 2017. Net Loss per Common Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Common shares outstanding consist of issued shares, including allocated and committed shares held by the ESOP trust, less shares held in treasury. The dilutive securities below do not include 5,055,555 potentially convertible Debentures since the requirements for possible conversion have not yet been met and may never be met. The table below summarizes the components of potential dilutive securities at March 31, 2017 and 2016. March 31, March 31, Description 2017 2016 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,440,000 Private Placement Warrants 1,036,500 1,111,500 Convertible Promissory Notes 1,925,000 1,925,000 Total 6,636,500 6,736,500

Note 4. Accounts Payable and Ac

Note 4. Accounts Payable and Accrued Expenses	3 Months Ended
	Mar. 31, 2017
Notes
Note 4. Accounts Payable and Accrued Expenses	Note 4 Accounts Payable and Accrued Expenses The table below outlines the elements included in accounts payable and accrued expenses at March 31, 2017 and December 31, 2016 : March 31, December 31, Description 2017 2016 Related Parties: Accrued payroll due officers 1,844,711 1,769,711 Accrued interest due officers and directors 610,397 568,161 Accrued director fees 333,750 311,250 Base rents due to the President 90,428 76,826 Associated rental costs 32,071 28,908 Other 17,308 17,308 Total Related Parties 2,928,665 2,772,164 Non-Related Parties: Accrued interest 1,285,409 1,220,516 Accrued dividends 584,200 558,800 Accrued fines and penalties 12,150 7,650 Other accounts payable and accrued expenses 225,346 225,560 Total Non-related Parties 2,107,105 2,012,526 Total accounts payable and accrued expenses 5,035,770 4,784,690

Note 5. Convertible Notes and L

Note 5. Convertible Notes and Line of Credit	3 Months Ended
	Mar. 31, 2017
Notes
Note 5. Convertible Notes and Line of Credit	Note 5. Convertible Notes and Line of Credit Line of Credit On October 23, 2008, the Company entered into an agreement with an unrelated third party for an unsecured Line of Credit up to a maximum of $1,000,000. The Line of Credit provided for funds to be drawn as needed and carries an interest rate on amounts borrowed of 9% per annum, originally payable quarterly, based on the pro rata number of days outstanding. All funds originally advanced under the facility were due and payable by November 1, 2012. As an inducement to provide the facility, the lender was awarded an immediate option to purchase 50,000 shares of common stock of the Company at $1.75 per share. In addition, the lender received an option to purchase a maximum of 250,000 additional shares of common stock of the Company at $1.75 per share. The options expire following repayment in full by the Company of the amount borrowed. At March 31, 2017, the principal and accrued interest due on the obligation, which totals $1,695,860, remains unpaid. Convertible Notes and Warrants Pursuant to a Private Placement Memorandum dated March 1, 2010, the Company offered Units consisting of a two year unsecured, convertible promissory note in the principal amount of $25,000 with interest at 12% per annum, together with a five year Warrant to purchase 50,000 shares of the Company’s common stock at an exercise price of $1.00 per share. The Promissory Note is convertible into 50,000 shares of common stock of the Company immediately upon issuance at the option of the investor. The five-year Warrants issued in connection with the Units have expired. Pursuant to an additional Private Placement Memorandum dated October 25, 2010, the Company offered Units consisting of a two year unsecured, convertible promissory note in the principal amount of $25,000, together with a five year Warrant to purchase 50,000 shares of the Company’s common stock at an exercise price of $1.00 per share. The Promissory Notes bear interest at 9% per annum and are convertible into 50,000 shares of common stock of the Company immediately upon issuance at the option of the investor. The five-year Warrants issued in connection with the Units have expired. The Convertible Notes issued pursuant to the Private Placements discussed above total $962,500 in principal and became due and payable beginning in March 2012 and extending at various dates through June 2013. As of the date of the filing of this report, all of the aforementioned debt obligations remain unpaid and in default under the repayment terms of the notes. In addition, a total of $479,225 of accrued interest on the above notes remains outstanding. The table below summarizes the Company’s debt arising from the above-described sources as of March 31, 2017 and December 31, 2016: Gross Amount Amount Due Amount Due Loan Facility Owed Related Parties Others Line of Credit $ 1,000,000 $ - $ 1,000,000 Private Placements: March 1, 2010 475,000 75,000 400,000 October 25, 2010 487,500 - 487,500 Total Private Placements 962,500 75,000 887,500 Total $ 1,962,500 $ 75,000 $ 1,887,500

Note 6. Convertible Debentures

Note 6. Convertible Debentures and Derivative Liability	3 Months Ended
	Mar. 31, 2017
Notes
Note 6. Convertible Debentures and Derivative Liability	Note 6. Convertible Debentures and Derivative Liability Pursuant to a Private Placement Memorandum dated February 14, 2014 (the "Private Placement"), the Company offered up to a maximum of $3,000,000 of Collateralized Convertible Senior Debentures in three tranches of $1,000,000 each, to accredited or institutional investors. The Offering was conducted contingent on the deposit into Escrow of the purchase price for all of the Debentures offered in the principal amount of $3,000,000. The Debentures, once issued, bear interest at 4% per annum after 180 days, mature six years from the date of issuance, and are secured by a lien on the Company’s Mississippi property. On March 31, 2014, the First Closing occurred when subscriptions in the amount of $3,000,000 were received in Escrow and accepted by the Company. The Escrow Agent released $1,000,000 to the Company and the Company issued First Tranche Debentures in the aggregate principle amount of $1,000,000. On December 31, 2014, investors who had purchased $950,000 of First Tranche Debentures consented to Amendment I to the Private Placement, which amended certain terms and conditions, including the conversion terms of the First Tranche Debentures. The remaining First Tranche Debenture in the amount of $50,000 remains as originally issued with no conversion rights. Thus, the First Tranche Debentures can be converted into a total of 3,166,666 shares of common stock. On December 31, 2014, the Second Closing occurred when investors representing $850,000 of Second Tranche Debentures consented to Amendment II to the Private Placement, which amended certain terms and conditions, including those relating to issuance and conversion of the Second and Third Tranche Debentures, as well as the period of time within which to perform the Third Tranche Closing Obligations, as amended. The Escrow Agent released $850,000 to the Company and the Company issued Second Tranche Debentures in the aggregate principle amount of $850,000. Thus, the Second Tranche Debentures can be converted into a total of 1,888,889 shares of common stock. The Escrow Agent refunded $300,000 to those investors who did not consent to Amendment II. The Company did not meet the closing obligations for the Third Tranche Debentures as of June 30, 2015, as was required, pursuant to the terms of the Private Placement, as amended. Therefore, the remaining $850,000 being held in escrow for the purchase of the Third Tranche Debentures was returned to the investors in July 2015. For purposes of determining the proper accounting treatment and valuation of the instruments, the Company applied the provisions set forth in ASC Topic 820, "Fair Value in Financial Instruments" and ASC Topic 815, "Accounting for Derivative Instruments and Hedging Activities." Since the Notes issued have derivative features, the embedded derivatives should be bundled and valued as a single, compound embedded derivative, bifurcated from the debt host and treated as a liability. In addition, the valuation is required to be conducted for each reporting period the instrument is in existence. The Company's stock was not trading from approximately September 4, 2014, when its stock registration was revoked, through approximately October 26, 2015, when its' stock began to trade again. The Company engaged an independent valuation expert to determine the fair value of its shares of common stock for each quarter beginning with the quarter ended September 30, 2014. For periods from September 30, 2014 through September 30, 2015, the fair value of the common stock was estimated by adjusting the most recent market price by changes in the underlying market cap due to changes in the value of net assets and applying a discount for lack of marketability inasmuch as the stock was not trading. After the stock began to trade again on or about October 26, 2015, the closing price of the stock was used in the valuation beginning with the quarter ending December 31, 2015 through this most recent valuation at March 31, 2017. Monte Carlo models were developed to value the derivative liability within the Notes using a historical volatility rate, based on comparable companies, of 159% at March 31, 2017 and 179% at December 31, 2016, and using discount bond rates based on the expected remaining term of each instrument ranging from 5.28% to 5.82% at March 31, 2017 and 5.26% at December 31, 2016. In addition, the valuation assumed that conversion requirements for Tranche 1 Debentures, exclusive of price, were met as of March 31, 2017, while conversion requirements for Tranche 2 Debentures were expected to be met by October 27, 2017 for the March 31, 2017 calculation. The estimated fair value for the derivative liability relating to each Debenture at the balance sheet dates is as follows: March 31, 2017 December 31, 2016 Tranche 1 $935,786 $1,008,068 Tranche 2 881,845 1,022,221 Derivative Liability $1,817,631 $2,030,289 At the initial valuation date of each Tranche, a portion of the derivative liability was allocated to the Convertible Debentures as debt discount, with the remainder being recorded as other income/expense. At March 31, 2014, the initial valuation of the First Tranche Debentures, $1,000,000 was allocated to debt discount and, at December 31, 2014, the initial valuation of the Second Tranche Debentures, $850,000 was allocated to debt discount. The debt discount is subsequently amortized to expense using an effective interest methodology. Amortization of debt discount amounted to $26,920 and $13,197 for Convertible Debentures and $929 and $455 for the non-convertible Debenture for the three months ended March 31, 2017 and 2016, respectively. The interest payment on these Debentures for the calendar year 2015 in the amount of $57,233 was due March 1, 2016 and the interest payment in the amount of $74,000 for 2016 was due March 31, 2017. The Company failed to make these payments and therefore is in default under the terms of the Debenture. On October 25, 2016, certain Debenture holders filed a Complaint against the Company in the United States District Court for the District of Delaware On November 21, 2016, the Company filed a motion to dismiss for lack of subject matter jurisdiction due to failure to plead diversity. On February 21, 2017, the plaintiffs filed a motion for leave to amend their complaint based upon declarations of citizenship previously filed with the court.

Note 7. Interest Bearing Advanc

Note 7. Interest Bearing Advance	3 Months Ended
	Mar. 31, 2017
Notes
Note 7. Interest Bearing Advance	Note 7. Interest Bearing Advance On February 2, 2017, the Company borrowed $25,000 from an unrelated third party. The Company expects to enter into a formal note for these funds. However the terms of the note have not been finalized. The Note is expected to carry an annual interest rate of approximately 12.5% with a projected due date of December 31, 2017. The President of the Company has agreed to personally secure the note with an assignment of proceeds due to her under the first lien on the Diamondhead property.

Note 8. Long -Term Notes Payabl

Note 8. Long -Term Notes Payable	3 Months Ended
	Mar. 31, 2017
Notes
Note 8. Long -Term Notes Payable	Note 8. Long –Term Notes Payable In the first four months of 2016, the Company received cash advances totaling $47,500 from seven lenders which included $25,000 from three current Directors of the Company. The proceeds from the cash advances were earmarked for the payment of accounting and auditing fees and other expenses required to file the Company's Form 10-Q. On August 25, 2016, the Company issued a Note to the foregoing lenders, which matures four years from the date of issuance and bears interest at 8% per annum, with a full year of interest accruing in any year in which the advance remains unpaid. In the third quarter of 2016, the Chairman of the Board of Directors of the Company loaned the Company an additional $90,000. On August 25, 2016, the Company issued a Note to the Chairman of the Board. The Note bears interest at 14% per annum effective August 1, 2016 and matures four years from the date of issuance. The proceeds of the loan were used for the payment of Mississippi property taxes, and auditing, accounting and other corporate expenses. The principal due under the foregoing loans totals $137,500. The Company has filed a second lien on its Mississippi property in favor of the note holders to secure both principal and interest in the maximum amount of $250,000. The lien is second to the existing first lien on the Mississippi property in the amount of $3.85 million. The first lien is held by holders of previously-issued convertible and non-convertible Debentures ($1.85 million) and certain executives and directors ($2 million), as outlined in Note 12. The table below summarizes the Company’s long term notes payable as of March 31, 2017 and December 31, 2016: Gross Amount Amount Due Amount Due Loan Facility Owed Related Parties Others 4 Year 8% secured note $47,500 $25,000 $22,500 4 Year 14% secured note 90,000 90,000 - Total $137,500 $115,000 $22,500

Note 9. Related Party Transacti

Note 9. Related Party Transactions	3 Months Ended
	Mar. 31, 2017
Notes
Note 9. Related Party Transactions	Note 9. Related Party Transactions As of March 31, 2017, the President of the Company is owed deferred salary in the amount of $1,641,996. As of March 31, 2017, a Vice President and the current Chairman of the Board of Directors of the Company is owed deferred salary in the amount of $121,140. The Board of directors agreed to pay interest at 9% per annum on the foregoing amounts owed. Interest expense under this agreement amounted to $38,018 and $31,360 for the three months ended March 31, 2017 and 2016, respectively. Total interest accrued under this agreement totaled $558,360 and $520,342 as of March 31, 2017 and December 31, 2016, respectively. Effective September 1, 2011, the Company entered into a month-to-month lease with the President and then-Chairman of the Board of Directors of the Company, for office space in a furnished and fully equipped townhouse office building owned by the President in Alexandria, Virginia. The lease calls for monthly base rent in the amount of $4,534 and payment of associated costs of insurance, real estate taxes, utilities and other expenses. Rent expense associated with this lease amounted to base rent in the amount of $13,602 and associated rental costs of $3,763 for a total of $17,365 for the three months ended March 31, 2017 and base rent in the amount of $13,602 and associated rental costs of $3,505 for a total of $17,107 for the three months ended March 31, 2016. No payments associated with the lease were made in the first three months of 2017. At March 31, 2017 and December 31, 2016, amounts owing for base rent and associated rental costs totaled $122,499 and $105,734, respectively. Directors of the Company are entitled to a director's fee of $15,000 per year for their services. The Company has been unable to pay directors' fees to date. A total of $333,750 and $311,250 was due and owing to the Company’s current and former directors as of March 31, 2017 and December 31, 2016, respectively. Directors have previously been compensated and may, in the future, be compensated for their services with cash, common stock, or options to purchase common stock of the Company.

Note 10. Commitments and Contin

Note 10. Commitments and Contingencies	3 Months Ended
	Mar. 31, 2017
Notes
Note 10. Commitments and Contingencies	Note 10. Commitments and Contingencies The Company’s obligations under the Collateralized Convertible Senior Debentures are secured by a lien on the Company’s Mississippi property (the “Investors Lien”). On March 31, 2014, the Company issued $1 million of First Tranche Collateralized Convertible Senior Debentures and on December 31, 2014 the Company issued $850,000 of Second Tranche Collateralized Convertible Senior Debentures. Thus, liens were placed on the Property in favor of the Investors for $1,850,000. The Investors Lien is in pari passu The Company has filed a second lien in the maximum amount of $250,000 on the Diamondhead property to secure certain notes payable totaling $137,500 in principal and accrued interest incurred. Details of these notes are more fully described in Note 8. Litigation College Health & Investment, L.P. v. Diamondhead Casino Corporation (Delaware Superior Court)(C.A. No. N15C-01-119-WCC) On January 15, 2015, the plaintiff, a beneficial owner of in excess of 5% of the common stock of the Company, filed suit for breach of a Promissory Note issued March 25, 2010, in the principle amount of $150,000, with interest payable at 12% per annum, with a maturity date of March 25, 2012. Plaintiff seeks payment of principle of $150,000, interest due through December 31, 2014 in the amount of $45,000, and interest due of 12% per annum from December 31, 2014 until entry of judgment. The Note, as well as the accrued interest thereon, are shown as current liabilities on the Company’s balance sheet at December 31, 2015. On January 22, 2015, the defendant forwarded a Notice of Conversion to plaintiff, exercising the Borrower's right to convert the principal and any interest due on the Note into common stock. On February 11, 2015, the Company moved to dismiss the complaint as moot. The plaintiff filed an opposition to the motion to dismiss alleging that the Note was convertible only prior to its maturity date. On July 2, 2015, the Court agreed with the Plaintiff and denied the Company's motion to dismiss. On July 16, 2015, the Company filed an Answer and Grounds of Defense. On August 18, 2015, the Company filed a Suggestion of Bankruptcy and Automatic Stay. The matter was stayed due to the below-referenced bankruptcy action (Case No. 15-11647) College Health & Investment, L.P. v. Diamondhead Casino Corporation (In the Court of Chancery of the State of Delaware (C.A. No. 10663-CB) On February 13, 2015, the plaintiff, a beneficial owner of in excess of 5% of the common stock of the Company, filed a Verified Complaint Pursuant to 8 Del.C.§211(c), with a Verification signed by the plaintiff's General Partner, Samuel I. Burstyn, seeking an order compelling the Company to hold an annual meeting. The Company agreed to entry of an Order setting a new date for an annual meeting of June 8, 2015, a Record Date of April 24, 2015, and to clarify that there is no advance notice requirement for the submission of stockholder proposals at the Company's annual stockholders' meetings. The plaintiff sought costs and expenses, including attorneys' fees. On or about July 7, 2015, the Plaintiff filed a Motion for an Award of Attorneys' Fees and Reimbursement of Expenses in the total amount of $150,000 for both this case and the following case. The Company filed an opposition to this motion. On August 18, 2015, the Company filed a Suggestion of Bankruptcy and Automatic Stay. The matter was stayed due to the below-referenced bankruptcy action (Case No. 15-11647) which has now concluded. No further activity has occurred in this case. College Health & Investment, L.P. v. Edson R. Arneault, Deborah A. Vitale, Gregory A. Harrison, Martin Blount and Benjamin Harrell(In the Court of Chancery of the State of Delaware)(C.A. No. 10793-CB) On March 14, 2015, the plaintiff, a beneficial owner in excess of 5% of the common stock of the Company, filed a Verified Complaint, with a Verification signed by the plaintiff's General Partner, Samuel I. Burstyn. In Count I, the plaintiff alleges that the defendants breached their fiduciary duty of disclosure. In Count II, the plaintiff alleges that defendants breached their fiduciary duties of loyalty and care. The plaintiff sought injunctive relief, but no monetary damages other than attorney’s fees. The defendants believe that plaintiff's claims are without merit and intend to vigorously defend this lawsuit. In addition, on or about July 30, 2015, the defendant directors filed Defendants' Answer and Verified Counterclaims for defamation, breach of fiduciary duty and aiding and abetting a breach of fiduciary duty. On August 19, 2015, the plaintiff filed a Motion to Dismiss the Counterclaims. As noted above, on or about July 7, 2015, the Plaintiff filed a Motion for an Award of Attorneys' Fees and Reimbursement of Expenses in the total amount of $150,000 in this case and the above-referenced case. On or about August 26, 2015, the defendants filed an Opposition to Plaintiff's Motion for an Award of Fees and Reimbursement of Expenses. On September 25, 2015, the parties entered into a Stipulation and [Proposed] Order Staying Litigation pending the below-referenced bankruptcy action (Case No. 15-11647) . In re Diamondhead Casino Corporation (United States Bankruptcy Court)(District of Delaware)(Case No. 15-11647- LSS) On August 6, 2015, an Involuntary Petition was filed in the United States Bankruptcy Court by three promissory note holders under title 11, United States Code, requesting an order for relief under chapter 7 of the Bankruptcy Code. The three creditors listed combined claims of $150,000 in principal, plus interest due on certain promissory notes. On August 28, 2015, the Company filed a Motion to Dismiss the Involuntary Petition or, in the Alternative, to Convert the Case to Chapter 11 (the "Motion to Dismiss"). The Company maintained that the Petition was filed in bad faith by supporters of the dissident slate which lost the proxy contest that was decided by the stockholders on June 8, 2015 and that it was filed in retaliation for the Company's refusal, following the stockholders' vote, to place several of the losing dissident's nominees on the Board of Directors. On September 11, 15 and 17, 2015, three additional promissory note holders filed Joinders to the Involuntary Petition listing additional combined claims of $237,500 plus interest. The Company does not recognize one of the joining petitioners as a bona fide creditor of the Company. On September 17, 2015, the six Petitioners, who were represented by the same attorneys, filed an Objection to the Company's Motion to Dismiss. On September 18, 2015, the six Petitioners filed an Emergency Motion for Entry of an Order Directing the Appointment of (I) an Interim Chapter 7 Trustee, or (II) alternatively, a Chapter 11 Trustee Should the Involuntary Case be converted (the "Emergency Motion"). The Court held an evidentiary hearing on the Emergency Motion in October 2015. On November 13, 2015, the Court denied the Petitioners' Emergency Motion as it related to the request for an interim Chapter 7 trustee. On January 15, 2016, the Court held an evidentiary hearing on the Company's Motion to Dismiss the Involuntary Petitions. The parties filed briefs in support of and in opposition to the motion. On June 7, 2016, the Court entered an Order granting the Company's Motion to Dismiss the Involuntary Petitions. In its accompanying Opinion, the Court found, in part, that based on the totality of the circumstances, the Creditors' primary concern in filing the involuntary petition was to effect a change in management to benefit their investments as stockholders, which was not a proper purpose for filing an involuntary bankruptcy petition. On June 30, 2016, the Company filed a Motion for an Award of Fees and Expenses and Punitive Damages. On August 11, 2016, the Petitioning Creditors filed an Opposition to the Company's Motion for an Award of Fees and Expenses and Punitive Damages. On August 31, 2016, the Court entered an Order awarding judgment to the Company for attorneys’ fees and expenses against the Petitioners, jointly and severally, in the amount of $54,886. On September 1, 2016, the Court filed an Amended Order in which it further stated that the amounts awarded were not subject to any setoff against amounts owed by the Company to the Petitioners. The Company has filed a collection action against the Petitioners to collect the attorneys' fees and expenses incurred in defending this action. Edson R. Arneault, Kathleen Devlin and James Devlin, J. Steven Emerson, Emerson Partners, J. Steven Emerson Roth IRA, Steven Rothstein, and Barry Stark and Irene Stark v. Diamondhead Casino Corporation (In the United States District Court for the District of Delaware (C.A. No. 1:16-cv-00989-UNA) On October 25, 2016, the above-named Debenture holders filed a Complaint against the Company in the United States District Court for the District of Delaware for monies due and owing pursuant to certain Collateralized Convertible Senior Debentures issued on March 31, 2014 and December 31, 2014. The plaintiffs are seeking $1.4 million, plus interest from January 1, 2015, together with costs and fees. The Company was served with the Complaint on October 31, 2016. On November 21, 2016, the Company filed a motion to dismiss for lack of subject matter jurisdiction due to failure to plead diversity. On February 21, 2017, the plaintiffs filed a motion for leave to amend their complaint based upon declarations of citizenship previously filed with the court. Employee Stock Ownership Plan The Company failed to file information returns required to be filed in connection with its Employee Stock Ownership Plan (“ESOP”) for the 2015 calendar year in a timely fashion. The filings were due to be filed with the Department of Labor by October 15, 2016. The Company did not have sufficient funds to pay professionals to audit its ESOP and/or prepare and file required documents and forms when due. Although these required filings normally do not result in any tax due to an agency of the government, the Company could be subject to penalties for failure to file these forms when due. The Company intends to bring its ESOP-required filings current and when current, will attempt to enroll in a voluntary compliance program with the Department of Labor and the Internal Revenue Service with respect to any penalties or fines incurred. However, there can be no assurance the Company will be able to enroll in any such program or obtain a reduction of the fines and penalties that may be due. The Company has accrued $12,150 in anticipation of penalties as of March 31, 2017. Previously delinquent filings for the Plan for the years 2010 through 2014 were updated in 2016.

Note 3. Summary of Significan16

Note 3. Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2017
Policies
Principles of Consolidation	Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Diamondhead Casino Corporation and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Estimates	Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Land Held For Development	Land Held for Development Land held for development is carried at cost. Costs directly related to site development, such as licenses, permitting, engineering, and other costs, are capitalized. Land development costs, which have been capitalized, consist of the following at March 31, 2017 and December 31, 2016: Land under development $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 Total land held for development $5,476,097
Fair Value Measurements	Fair Value Measurements The Company follows the provisions of ASC Topic 820 “Fair Value Measurements” for financial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. The standard discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Input other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable input that reflects The table listed below provides a reconciliation of the beginning and ending net balances for the derivative liability measured at fair value using significant unobservable inputs (Level 3) at March 31, 2017 and December 31, 2016: March 31, December 31, 2017 2016 Beginning balance $ 2,030,289 $ 1,704,570 Total unrealized (appreciation) depreciation (212,658) 325,719 Ending balance $ 1,817,631 $ 2,030,289
Sensitivity Analysis To Changes in Level 3 Assumptions	Sensitivity Analysis to Changes in Level 3 Assumptions Significant inputs include the dates when required conditions are expected to be met under the conversion terms of the debentures, the underlying market cap due to borrowings and losses and discount for lack of marketability while the stock was delisted and reversed when the Company's stock became publicly listed again on or about October 26, 2015. In addition, use of different ranges of bond discount rates and changes in historical volatility rates would also result in a higher or lower fair value. Current assets and current liabilities are financial instruments and management believes that their carrying amounts are reasonable estimates of their fair values due to their short term nature. The convertible debentures and derivative liability approximate fair value based on Level 3 inputs, as further discussed in Note 7.
Long-lived Assets	Long-Lived Assets The Company reviews long-lived assets whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of longlived assets is measured by comparing the carrying amount of the assets to the estimated undiscounted future cash flows projected to be generated by the assets. If such assets are considered impaired, the impairment to be recognized is measured by the amount the carrying value exceeds the fair value of such assets determined by appraisal, discounted cash flow projections, or other means. No impairment existed at March 31, 2017.
Net Loss Per Common Share	Net Loss per Common Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Common shares outstanding consist of issued shares, including allocated and committed shares held by the ESOP trust, less shares held in treasury. The dilutive securities below do not include 5,055,555 potentially convertible Debentures since the requirements for possible conversion have not yet been met and may never be met. The table below summarizes the components of potential dilutive securities at March 31, 2017 and 2016. March 31, March 31, Description 2017 2016 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,440,000 Private Placement Warrants 1,036,500 1,111,500 Convertible Promissory Notes 1,925,000 1,925,000 Total 6,636,500 6,736,500

Note 3. Summary of Significan17

Note 3. Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2017
Tables/Schedules
Land development costs	Land development costs, which have been capitalized, consist of the following at March 31, 2017 and December 31, 2016: Land under development $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 Total land held for development $5,476,097
Schedule of Derivative Liability Reconciliation	The table listed below provides a reconciliation of the beginning and ending net balances for the derivative liability measured at fair value using significant unobservable inputs (Level 3) at March 31, 2017 and December 31, 2016: March 31, December 31, 2017 2016 Beginning balance $ 2,030,289 $ 1,704,570 Total unrealized (appreciation) depreciation (212,658) 325,719 Ending balance $ 1,817,631 $ 2,030,289
Schedule of Components of Potential Dilutive Securities	The table below summarizes the components of potential dilutive securities at March 31, 2017 and 2016. March 31, March 31, Description 2017 2016 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,440,000 Private Placement Warrants 1,036,500 1,111,500 Convertible Promissory Notes 1,925,000 1,925,000 Total 6,636,500 6,736,500

Note 4. Accounts Payable and 18

Note 4. Accounts Payable and Accrued Expenses (Tables)	3 Months Ended
	Mar. 31, 2017
Tables/Schedules
Schedule of Accounts Payable and Accrued Expenses	The table below outlines the elements included in accounts payable and accrued expenses at March 31, 2017 and December 31, 2016 : March 31, December 31, Description 2017 2016 Related Parties: Accrued payroll due officers 1,844,711 1,769,711 Accrued interest due officers and directors 610,397 568,161 Accrued director fees 333,750 311,250 Base rents due to the President 90,428 76,826 Associated rental costs 32,071 28,908 Other 17,308 17,308 Total Related Parties 2,928,665 2,772,164 Non-Related Parties: Accrued interest 1,285,409 1,220,516 Accrued dividends 584,200 558,800 Accrued fines and penalties 12,150 7,650 Other accounts payable and accrued expenses 225,346 225,560 Total Non-related Parties 2,107,105 2,012,526 Total accounts payable and accrued expenses 5,035,770 4,784,690

Note 5. Convertible Notes and19

Note 5. Convertible Notes and Line of Credit (Tables)	3 Months Ended
	Mar. 31, 2017
Tables/Schedules
Schedule of Convertible Notes and Line of Credit	The table below summarizes the Company’s debt arising from the above-described sources as of March 31, 2017 and December 31, 2016: Gross Amount Amount Due Amount Due Loan Facility Owed Related Parties Others Line of Credit $ 1,000,000 $ - $ 1,000,000 Private Placements: March 1, 2010 475,000 75,000 400,000 October 25, 2010 487,500 - 487,500 Total Private Placements 962,500 75,000 887,500 Total $ 1,962,500 $ 75,000 $ 1,887,500

Note 6. Convertible Debenture20

Note 6. Convertible Debentures and Derivative Liability (Tables)	3 Months Ended
	Mar. 31, 2017
Tables/Schedules
Schedule of Derivative Liabilities at Fair Value	The estimated fair value for the derivative liability relating to each Debenture at the balance sheet dates is as follows: March 31, 2017 December 31, 2016 Tranche 1 $935,786 $1,008,068 Tranche 2 881,845 1,022,221 Derivative Liability $1,817,631 $2,030,289

Note 8. Long -Term Notes Paya21

Note 8. Long -Term Notes Payable (Tables)	3 Months Ended
	Mar. 31, 2017
Tables/Schedules
Schedule of Long Term Notes Payable	The table below summarizes the Company’s long term notes payable as of March 31, 2017 and December 31, 2016: Gross Amount Amount Due Amount Due Loan Facility Owed Related Parties Others 4 Year 8% secured note $47,500 $25,000 $22,500 4 Year 14% secured note 90,000 90,000 - Total $137,500 $115,000 $22,500

Note 1. Organization and Busi22

Note 1. Organization and Business (Details)	Mar. 31, 2017a
Details
Area of Land, owned	404.5

Note 2. Liquidity and Going C23

Note 2. Liquidity and Going Concern (Details) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016	Dec. 31, 2015
Details
Net losses applicable to common shareholders, exclusive of recording of change in derivatives	$ (326,723)	$ (338,874)
Total current liabilities	9,013,635		$ 8,920,186
Cash	$ 3,742	$ 4,298	$ 17,606	$ 15,655

Note 3. Summary of Significan24

Note 3. Summary of Significant Accounting Policies: Land Held For Development: Land development costs (Details) - USD ($)	3 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Details
Land under development	$ 4,934,323
Licenses	77,000
Engineering and costs associated with permitting	464,774
Total land held for development	$ 5,476,097	$ 5,476,097

Note 3. Summary of Significan25

Note 3. Summary of Significant Accounting Policies: Fair Value Measurements: Schedule of Derivative Liability Reconciliation (Details) - Derivative Financial Instruments, Liabilities - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Beginning balance	$ 2,030,289	$ 1,704,570
Total unrealized (appreciation) depreciation	(212,658)	325,719
Ending balance	$ 1,817,631	$ 2,030,289

Note 3. Summary of Significan26

Note 3. Summary of Significant Accounting Policies: Net Loss Per Common Share (Details)	3 Months Ended
	Mar. 31, 2017shares
Convertible Debt Securities
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	5,055,555

Note 3. Summary of Significan27

Note 3. Summary of Significant Accounting Policies: Net Loss Per Common Share: Schedule of Components of Potential Dilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Details
Convertible Preferred Stock	260,000	260,000
Options to Purchase Common Shares	3,415,000	3,440,000
Private Placement Warrants	1,036,500	1,111,500
Convertible Promissory Notes	1,925,000	1,925,000
Total	6,636,500	6,736,500

Note 4. Accounts Payable and 28

Note 4. Accounts Payable and Accrued Expenses: Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Related Parties:
Accrued payroll due officers	$ 1,844,711	$ 1,769,711
Accrued interest due officers and directors	610,397	568,161
Accrued director fees	333,750	311,250
Base rents due to the President	90,428	76,826
Associated rental costs	32,071	28,908
Other	17,308	17,308
Total Related Parties	2,928,665	2,772,164
Non-Related Parties
Accrued interest	1,285,409	1,220,516
Accrued dividends	584,200	558,800
Accrued fines and penalties	12,150	7,650
Other accounts payable and accrued expenses	225,346	225,560
Total Non-related Parties	2,107,105	2,012,526
Total accounts payable and accrued expenses	$ 5,035,770	$ 4,784,690

Note 5. Convertible Notes and29

Note 5. Convertible Notes and Line of Credit (Details) - USD ($)	1 Months Ended	3 Months Ended
	Oct. 31, 2008	Mar. 31, 2017	Oct. 23, 2008
Line of Credit Facility, Maximum Borrowing Capacity			$ 1,000,000
Corporate Debt Securities
Debt Instrument, Debt Default, Amount		$ 479,225
Line of Credit
Debt Instrument, Interest Rate, Stated Percentage			900.00%
Debt Instrument, Maturity Date	Nov. 1, 2012
Line of Credit | Employee Stock Option | October 23 2008
Options, Granted		50,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Weighted Average Grant Date Fair Value		$ 1.75
Line of Credit, Current		$ 1,695,860
Line of Credit | Employee Stock Option | October 23 2008 2
Options, Granted		250,000
Convertible Promissory Note
Debt Instrument, Face Amount		$ 962,500
Convertible Promissory Note | March 1 2010 Private Placement
Debt Instrument, Interest Rate, Stated Percentage		1200.00%
Debt Instrument, Face Amount		$ 25,000
Warrants per unit		50,000
Warrant Exercise Price		$ 1
Debt Instrument, Convertible, Terms of Conversion Feature		convertible into 50,000 shares of common stock of the Company immediately upon issuance at the option of the investor.
Convertible Promissory Note | October 25 2010 Private Placement
Debt Instrument, Interest Rate, Stated Percentage		900.00%
Debt Instrument, Face Amount		$ 25,000
Warrants per unit		50,000
Warrant Exercise Price		$ 1
Debt Instrument, Convertible, Terms of Conversion Feature		convertible into 50,000 shares of common stock of the Company immediately upon issuance at the option of the investor.

Note 5. Convertible Notes and30

Note 5. Convertible Notes and Line of Credit: Schedule of Convertible Notes and Line of Credit (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Notes and line of credit payable (Note 5)	$ 1,962,500	$ 1,962,500
Related Parties
Notes and line of credit payable (Note 5)	75,000
Others
Notes and line of credit payable (Note 5)	1,887,500
Line of Credit
Notes and line of credit payable (Note 5)	1,000,000
Line of Credit | Related Parties
Notes and line of credit payable (Note 5)	0
Line of Credit | Others
Notes and line of credit payable (Note 5)	1,000,000
Convertible Promissory Note
Notes and line of credit payable (Note 5)	962,500
Convertible Promissory Note | March 1 2010 Private Placement
Notes and line of credit payable (Note 5)	475,000
Convertible Promissory Note | October 25 2010 Private Placement
Notes and line of credit payable (Note 5)	487,500
Convertible Promissory Note | Related Parties
Notes and line of credit payable (Note 5)	75,000
Convertible Promissory Note | Related Parties | March 1 2010 Private Placement
Notes and line of credit payable (Note 5)	75,000
Convertible Promissory Note | Related Parties | October 25 2010 Private Placement
Notes and line of credit payable (Note 5)	0
Convertible Promissory Note | Others
Notes and line of credit payable (Note 5)	887,500
Convertible Promissory Note | Others | March 1 2010 Private Placement
Notes and line of credit payable (Note 5)	400,000
Convertible Promissory Note | Others | October 25 2010 Private Placement
Notes and line of credit payable (Note 5)	$ 487,500

Note 6. Convertible Debenture31

Note 6. Convertible Debentures and Derivative Liability (Details)	1 Months Ended	3 Months Ended		12 Months Ended
	Dec. 31, 2014USD ($)	Mar. 31, 2017USD ($)	Mar. 31, 2016USD ($)	Dec. 31, 2016USD ($)	Mar. 01, 2016USD ($)	Mar. 31, 2014USD ($)
Amortization of debt discount		$ 27,849	$ 13,652
Tranche 1
Unamortized discount						$ 1,000,000
Tranche 2
Unamortized discount						$ 850,000
Convertible Debt Securities
Unamortized discount		1,635,121		$ 1,662,041
Amortization of debt discount		26,920	13,197
Convertible Debt Securities | February 14 2014 Private Placement
Maximum Offering Amount		3,000,000
Debt Instrument, Face Amount		$ 1,000,000
Debt Instrument, Interest Rate, Stated Percentage		400.00%
Debt Instrument, Maturity Date, Description		mature six years from the date of issuance
Convertible Debt Securities | February 14 2014 Private Placement | Derivative Financial Instruments, Liabilities
Fair Value Measurements, Valuation Techniques		Monte Carlo models
Fair Value Assumptions, Expected Volatility Rate		15900.00%		17900.00%
Fair Value Inputs, Discount Rate				526.00%
Convertible Debt Securities | February 14 2014 Private Placement | Derivative Financial Instruments, Liabilities | Minimum
Fair Value Inputs, Discount Rate		528.00%
Convertible Debt Securities | February 14 2014 Private Placement | Derivative Financial Instruments, Liabilities | Maximum
Fair Value Inputs, Discount Rate		582.00%
Convertible Debt Securities | February 14 2014 Private Placement | Tranche 1
Investors that consented to amended conversion terms, amount of offering	$ 950,000
Investors that did not consent to amended conversion terms, amount of offering	$ 50,000
Debt Instrument, Convertible, Number of Equity Instruments	3,166,666
Convertible Debt Securities | February 14 2014 Private Placement | Tranche 2
Investors that consented to amended conversion terms, amount of offering	$ 850,000
Investors that did not consent to amended conversion terms, amount of offering	$ 300,000
Debt Instrument, Convertible, Number of Equity Instruments	1,888,889
Non Convertible Debenture
Amortization of debt discount		$ 929	$ 455
Corporate Debt Securities
Unamortized discount		44,323		$ 45,252
Interest payable		$ 74,000			$ 57,233

Note 6. Convertible Debenture32

Note 6. Convertible Debentures and Derivative Liability: Schedule of Derivative Liabilities at Fair Value (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Derivative liability (Note 6)	$ 1,817,631	$ 2,030,289
Tranche 1
Derivative liability (Note 6)	935,786	1,008,068
Tranche 2
Derivative liability (Note 6)	$ 881,845	$ 1,022,221

Note 7. Interest Bearing Adva33

Note 7. Interest Bearing Advance (Details) - Unrelated third party - USD ($)	3 Months Ended
	Mar. 31, 2017	Feb. 02, 2017
Debt Instrument, Face Amount		$ 25,000
Debt Instrument, Interest Rate, Stated Percentage		1250.00%
Debt Instrument, Maturity Date	Dec. 31, 2017

Note 8. Long -Term Notes Paya34

Note 8. Long -Term Notes Payable (Details) - USD ($)	Mar. 31, 2014	Mar. 31, 2017
Investor | Mississippi Property | Collateralized Convertible Senior Debentures
Lien Amount	$ 1,850,000	$ 1.85
Management
Lien Amount		2,000,000
Management | Mississippi Property | Collateralized Convertible Senior Debentures
Lien Amount	$ 2,000,000
4 Year 8 Secured Note
Debt Instrument, Face Amount		47,500
4 Year 8 Secured Note | Director
Debt Instrument, Face Amount		$ 25,000
Debt Instrument, Interest Rate, Stated Percentage		800.00%
4 Year 14 Secured Note
Debt Instrument, Face Amount		$ 90,000
4 Year 14 Secured Note | Director
Debt Instrument, Interest Rate, Stated Percentage		1400.00%
Notes Payable Principal Due
Debt Instrument, Face Amount		$ 137,500
Notes Payable Principal Due | Mississippi Property | Junior Lien
Lien Amount		250,000
Notes Payable Principal Due | Mississippi Property | Senior Lien
Lien Amount		$ 3.85

Note 8. Long -Term Notes Paya35

Note 8. Long -Term Notes Payable: Schedule of Long Term Notes Payable (Details)	Mar. 31, 2017USD ($)
Notes Payable, Noncurrent	$ 137,500
Related Parties
Notes Payable, Noncurrent	115,000
Others
Notes Payable, Noncurrent	22,500
4 Year 8 Secured Note
Notes Payable, Noncurrent	47,500
4 Year 8 Secured Note | Related Parties
Notes Payable, Noncurrent	25,000
4 Year 8 Secured Note | Others
Notes Payable, Noncurrent	22,500
4 Year 14 Secured Note
Notes Payable, Noncurrent	90,000
4 Year 14 Secured Note | Related Parties
Notes Payable, Noncurrent	90,000
4 Year 14 Secured Note | Others
Notes Payable, Noncurrent	$ 0

Note 9. Related Party Transac36

Note 9. Related Party Transactions (Details) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Accrued payroll due officers	$ 1,844,711		$ 1,769,711
Interest expense	107,184	$ 100,103
Accrued interest	1,285,409		1,220,516
Accrued director fees	333,750		311,250
Office Space Lease
Debt Instrument, Periodic Payment	4,534
Base rent expense	13,602	13,602
Associated rental costs	3,763	3,505
Operating Leases, Rent Expense, Net	17,365	17,107
President
Accrued payroll due officers	$ 1,641,996
Debt Instrument, Interest Rate, Stated Percentage	900.00%
Accrued rents	$ 122,499		105,734
Vice President
Accrued payroll due officers	121,140
Management
Interest expense	38,018	$ 31,360
Accrued interest	558,360		$ 520,342
Director
Directors Fees	$ 15,000

Note 10. Commitments and Cont37

Note 10. Commitments and Contingencies (Details) - USD ($)	Mar. 31, 2014	Mar. 31, 2017	Dec. 31, 2016	Dec. 31, 2014
Notes Payable, Noncurrent		$ 137,500
Accrued fines and penalties		$ 12,150	$ 7,650
College Health Investment LP V Diamondhead Casino Corporation
Debt Instrument, Interest Rate, Stated Percentage		1200.00%
College Health Investment LP V Diamondhead Casino Corporation | Principal
Loss Contingency, Damages Sought, Value		$ 150,000
College Health Investment LP V Diamondhead Casino Corporation | Interest
Loss Contingency, Damages Sought, Value		45,000
College Health Investment LP V Diamondhead Casino Corporation 2
Loss Contingency, Damages Sought, Value		150,000
CollegeHealthInvestmentLP V 5 Others
Loss Contingency, Damages Sought, Value		150,000
United States Bankruptcy Court
Loss Contingency, Damages Sought, Value		237,500
Litigation Settlement, Amount Awarded from Other Party		$ 54,886
College Health Investment LP
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners		500.00%
Mississippi Property
Secured Debt		$ 250,000
Management
Lien Amount		2,000,000
Collateralized Convertible Senior Debentures | Investor | Mississippi Property
Lien Amount	$ 1,850,000	$ 1.85
Collateralized Convertible Senior Debentures | Investor | Tranche 2
Debt Instrument, Face Amount				$ 850,000
Collateralized Convertible Senior Debentures | Management | Mississippi Property
Lien Amount	$ 2,000,000