Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Jun. 28, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | DIAMONDHEAD CASINO CORP | |
Entity Central Index Key | 0000844887 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 36,297,576 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash | $ 234 | $ 1,966 |
Total current assets | 234 | 1,966 |
Land (Note 3) | 5,476,097 | 5,476,097 |
Other assets | 80 | 80 |
Total assets | 5,476,411 | 5,478,143 |
Current liabilities: | ||
Accounts payable and accrued expenses due related parties (Note 4) | 5,156,340 | 4,914,175 |
Accounts payable and accrued expenses - others (Note 4) | 3,458,870 | 3,273,360 |
Convertible notes and line of credit payable (Note 5) | 1,962,500 | 1,962,500 |
Debenture payable (net of unamortized finance costs of $0 and $236, respectively) (Note 6) | 50,000 | 49,764 |
Convertible debenture payable (net of unamortized finance costs of $7,654 and $14,731, respectively) (Note 6) | 1,792,346 | 1,785,269 |
Short term notes and interest bearing advance (Note 7) | 80,504 | 80,504 |
Notes payable due related parties (Note 8) | 554,436 | 552,321 |
Total current liabilities | 13,054,996 | 12,617,893 |
Notes payable due others (Note 9) | 50,000 | 50,000 |
Total liabilities | 13,104,996 | 12,667,893 |
Commitments and contingencies (Notes 3 and 11) | ||
Stockholders' deficit: | ||
Preferred stock, $0.01 par value; shares authorized 5,000,000, outstanding 2,086,000 at March 31, 2020 and December 31, 2019 (aggregate liquidation preference of $2,519,080 at March 31, 2020 and December 31, 2019) | 20,860 | 20,860 |
Common stock, $0.001 par value; shares authorized 50,000,000, issued: 39,052,472 at March 31, 2020 and December 31, 2019 outstanding: 36,297,576 at March 31, 2020 and December 31, 2019 | 39,052 | 39,052 |
Additional paid-in capital | 35,313,037 | 35,313,037 |
Unearned ESOP shares | (2,965,070) | (2,965,070) |
Accumulated deficit | (39,887,054) | (39,448,219) |
Treasury stock, at cost, 766,251 shares at March 31, 2020 and December 31, 2019 | (149,410) | (149,410) |
Total stockholders' deficit | (7,628,585) | (7,189,750) |
Total liabilities and stockholders' deficit | $ 5,476,411 | $ 5,478,143 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Preferred stock, par value | $ 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 value | $ 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 | 766,251 | 766,251 |
Debenture Payable [Member] | ||
Unamortized finance costs | $ 0 | $ 236 |
Convertible Debentures Payable [Member] | ||
Unamortized finance costs | $ 7,654 | $ 14,731 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
COSTS AND EXPENSES | ||
Administrative and general | $ 193,428 | $ 187,699 |
Other | 16,912 | 15,968 |
Total costs and expenses | 210,340 | 203,667 |
Interest expense: | ||
Related parties | 124,974 | 106,609 |
Other | 78,121 | 74,382 |
Change in derivative indemnification liability | 658,350 | |
Litigation settlement | (36,000) | |
Total other expense (income), net | 203,095 | 803,341 |
NET LOSS | (413,435) | (1,007,008) |
PREFERRED STOCK DIVIDENDS | (25,400) | (25,400) |
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS | $ (438,835) | $ (1,032,408) |
Weighted average common shares outstanding - basic and diluted | 36,297,576 | 36,297,576 |
Net loss per common share - basic and diluted | $ (0.012) | $ (0.028) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Deficiency (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Preferred Stock [Member] | ||
Balance | $ 20,860 | $ 20,860 |
Balance, shares | 2,086,000 | 2,086,000 |
Dividends | ||
Net loss | ||
Balance | $ 20,860 | $ 20,860 |
Balance, shares | 2,086,000 | 2,086,000 |
Common Stock [Member] | ||
Balance | $ 39,052 | $ 39,052 |
Balance, shares | 39,052,472 | 39,052,472 |
Dividends | ||
Net loss | ||
Balance | $ 39,052 | $ 39,052 |
Balance, shares | 39,052,472 | 39,052,472 |
Additional Paid-In Capital [Member] | ||
Balance | $ 35,313,037 | $ 35,430,445 |
Dividends | ||
Net loss | ||
Balance | 35,313,037 | 35,430,445 |
Unearned ESOP [Member] | ||
Balance | $ (2,965,070) | $ (3,083,672) |
Balance, shares | 1,988,645 | 2,068,190 |
Dividends | ||
Net loss | ||
Balance | $ (2,965,070) | $ (3,083,672) |
Balance, shares | 1,988,645 | 2,068,190 |
Accumulated Deficit [Member] | ||
Balance | $ (39,448,219) | $ (38,070,603) |
Dividends | (25,400) | (25,400) |
Net loss | (413,435) | (1,007,008) |
Balance | (39,887,054) | (39,103,011) |
Treasury Stock [Member] | ||
Balance | $ (149,410) | $ (148,216) |
Balance, shares | 766,251 | 686,706 |
Dividends | ||
Net loss | ||
Balance | $ (149,410) | $ (148,216) |
Balance, shares | 766,251 | 686,706 |
Balance | $ (7,189,750) | $ (5,812,134) |
Dividends | (25,400) | (25,400) |
Net loss | (413,435) | (1,007,008) |
Balance | $ (7,628,585) | $ (6,844,542) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (413,435) | $ (1,007,008) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization | 7,313 | 7,233 |
Change in derivative indemnification liability | 658,350 | |
Changes in operating assets and liabilities: | ||
Other current assets | 13,704 | |
Accounts payable and accrued expenses - related parties | 216,765 | 197,138 |
Accounts payable and accrued expenses - other | 185,510 | 110,715 |
Net cash used in operating activities | (3,847) | (19,868) |
Cash flows from financing activities: | ||
Proceeds from notes payable issued to related parties | 2,115 | 60,408 |
Payments of notes payable issued to related parties | (36,167) | |
Proceeds from short term notes and interest bearing advances | 2,734 | |
Payments of short term notes | (483) | |
Net cash provided by financing activities | 2,115 | 26,492 |
Net (decrease) increase in cash | (1,732) | 6,624 |
Cash at beginning of year | 1,966 | |
Cash at end of year | 234 | 6,624 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 841 | |
Supplemental disclosure of non-cash financing activities: | ||
Unpaid preferred stock dividends in accounts payable and accrued expenses | $ 25,400 | $ 25,400 |
Organization and Business
Organization and Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Note 1. Organization and Business Diamondhead Casino Corporation and its Subsidiaries (the “Company”) own a total of approximately 400 acres of unimproved land in Diamondhead, Mississippi (“the Property”). Active subsidiaries of the Company include Mississippi Gaming Corporation, which owns the approximate 400-acre site and Casino World, Inc. The Company’s intent was to construct a casino resort and other amenities on the Property unilaterally or, in conjunction with one or more joint venture partners. However, the Company has been unable to date, to obtain financing to move the project forward and/or enter into a joint venture partnership. Due to its lack of financial resources and certain law suits filed against it, the Company has been forced to explore other alternatives, including a sale of part or all of the Property. The Company’s preference is to sell only part of the Property inasmuch as this would appear to be in the best interest of the stockholders of the Company. However, there can be no assurance the Company will be able to sell only part of the Property. The Company intends to continue to pursue a joint venture partnership and/or other financing while seeking a viable purchaser for part or all of the Property. Thus, on March 25, 2019, Mississippi Gaming Corporation entered into a brokerage agreement with an unrelated third party to seek a buyer for all or part of the Property or, alternatively, to seek a joint venture partner for the project. The brokerage agreement has expired, but the Company continues to work with the broker on the same terms under the contract. |
Liquidity and Going Concern
Liquidity and Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
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 incurred losses over the past several years, has no operations, generates no operating revenues, and as reflected in the accompanying unaudited condensed consolidated financial statements, incurred a net loss applicable to common stockholders of $438,835 for the three months ended March 31, 2020. In addition, the Company had an accumulated deficit of $39,887,054 at March 31, 2020. Due to its lack of financial resources and certain lawsuits filed against it, the Company has been forced to explore other alternatives, including a sale of part or all of the Property. 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. That development is dependent upon the Company obtaining the necessary capital, through either equity and/or debt financing, unilaterally or in conjunction with one or more partners, to master plan, design, obtain permits for, construct, 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 as well as through other secured notes which are more fully described in Notes 5 through 9 to these unaudited condensed consolidated financial statements. The Company is in default with respect to payment of both principal and interest under the terms of most of these instruments. In addition, at March 31, 2020, the Company had $8,615,210 of accounts payable and accrued expenses and only $234 cash on hand. The above conditions raise substantial doubt as to the Company’s ability to continue as a going concern. COVID-19 The Company had no casino or other operations in 2020 when COVID-19 surfaced. Therefore, the Company did not experience the adverse consequences that other casino companies experienced from COVID-19 based on their cessation of casino-related operations. However, as a result of COVID, the Company’s sole employee, its President, was unable to travel domestically or internationally to meet with potential investors or potential joint venture partners or to meet with outside, independent contractors. The extent to which COVID-19 may have affected the market for financing new construction in the hospitality, hotel and casino industries given the impact of COVID-19 on this segment of the economy is unknown. The Company did not incur any extraordinary expenses as a result of COVID-19, nor did it obtain any loans under the CARES Act. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
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 unaudited condensed consolidated 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, 2020 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, 2019, attached 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 Land held for development is carried at cost. Costs directly related to site development, such as licensing, permitting, engineering, and other costs, are capitalized. Land development costs, which have been capitalized, consist of the following at March 31, 2020 and December 31, 2019: Land $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 Total land $ 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 management’s own assumptions. The fair value measurement of the derivative indemnification liability at March 31, 2020 and December 31, 2019 listed in Note 4 below was developed using Level 1 inputs. 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 long-lived 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, 2020. Net Loss per Common Share Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding. Diluted earnings per share is calculated by using the weighted average number of common shares outstanding, plus other potentially dilutive securities. Potentially dilutive securities are excluded from the computation of diluted loss per shares since their effect would be antidilutive. 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, 2020 and 2019. March 31, March 31, Description 2020 2019 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,415,000 Convertible Promissory Notes 1,925,000 1,925,000 Total 5,600,000 5,600,000 Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740)(“ASU 2019-12”) No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company’s present or future financial statements. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
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, 2020 and December 31, 2019: March 31, December 31, Description 2020 2019 Related parties: Accrued payroll due officers $ 2,744,711 $ 2,669,711 Accrued interest due officers and directors 1,461,601 1,336,626 Accrued director fees 591,250 568,750 Base rents due to the President 253,652 240,050 Associated rental costs 87,818 81,730 Other 17,308 17,308 Total related parties $ 5,156,340 $ 4,914,175 Non-related parties: Accrued interest $ 2,077,354 $ 2,006,545 Accrued dividends 889,000 863,600 Accrued fines and penalties 158,500 140,100 Other 334,016 263,115 Total non-related parties $ 3,458,870 3,273,360 |
Convertible Notes and Line of C
Convertible Notes and Line of Credit | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Notes and Line of Credit | Note 5. Convertible Notes and Line of Credit Line of Credit In 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 carries an interest rate on amounts borrowed of 9% per annum. 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. The Company is in default under the repayment terms of the agreement. At March 31, 2020 and December 31, 2019, the unpaid principal and accrued interest due on the obligation totaled $1,965,614 and $1,943,422, respectively. Convertible Notes 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. The Promissory Notes were convertible into 50,000 shares of common stock of the Company upon issuance and for a period of five years at the option of the investor. The conversion rights 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. The Promissory Notes bear interest at 9% per annum and were convertible into 50,000 shares of common stock of the Company upon issuance and for a period of five years at the option of the investor. The conversion rights have expired. The Convertible Notes issued pursuant to the two Private Placements discussed above total $962,500 in principal and became due and payable beginning in March 2012 and extending to 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 November 2020, the Superior Court of the State of Delaware awarded Judgments in favor of certain holders of these Promissory Notes who filed suit against the Company. As a result, the Company must carry an aggregate of $486,796 (total principal and interest) as debt owed to these noteholders. As of March 31, 2020 and December 31, 2019, all Notes issued had a total outstanding principal of $962,500 and accrued interest, including the additional interest awarded pursuant to the Court Judgments of $779,647 and $754,991, respectively. The table below summarizes the Company’s debt arising from the above-described sources as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Private placements - March 1, 2010* $ 475,000 $ 475,000 Private placements - October 25, 2010 487,500 487,500 $ 962,500 $ 962,500 *Of the 2010 placements above, $75,000 is due to a related party. |
Convertible Debentures Payable
Convertible Debentures Payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Debentures Payable | Note 6. Convertible Debentures Payable 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 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, originally bore interest at 4% per annum after 180 days, mature six years from the date of issuance, and were secured by a lien on the Company’s Mississippi property. The interest rate on these debentures was raised pursuant to a settlement agreement. The debentures were offered in three tranches as follows: (a) $1,000,000 of First Tranche Collateralized Convertible Senior Debentures convertible into an aggregate of 3,333,333 shares of Common Stock of the Company at a conversion price of $.30 per share (the “First Tranche Debentures”); (b) $1,000,000 of Second Tranche Collateralized Convertible Senior Debentures, convertible into an aggregate of 2,222,222 shares of Common Stock of the Company at a conversion price of $.45 per share (the “Second Tranche Debentures”); and (c) $1,000,000 of Third Tranche Collateralized Convertible Senior Debentures, convertible into either 1,818,182 shares of Common Stock or 1,333,333 shares of Common Stock of the Company, at a conversion price of $.55 or $.75 per share depending upon certain conditions described in the Private Placement Memorandum (the “Third Tranche Debentures”). The conversion rights on each issued Debenture carry an Anti-Dilution Provision. If the Company issues any shares of Common Stock or other securities after March 31, 2014 at a price per security that is less than the conversion price of a Debenture, then the Debenture shall have a new conversion price equal to the price per security that is less than the Conversion Price of the Debenture. The foregoing provision shall not apply to the following: (a) The issuance of any of the other Debentures in the Offering or the issuance of shares of Common Stock upon conversion of any of the Debentures in the Offering; (b) The issuance of any shares of Common Stock if such issuance relates to an agreement, arrangement or grant to issue shares of Common Stock entered into by the Company prior to the Issue Date of the First Tranche Debentures in the Offering, including but not limited to, for example, previously issued convertible promissory notes, previously issued warrants, previously issued options to purchase Common Stock, or common stock vested or to be issued pursuant to a pre-existing Employee Stock Ownership Plan. The Anti-Dilution Provisions with respect to a Debenture terminate the earlier of (a) the date (if ever) the Company receives an “Approval to Proceed” from the Mississippi Gaming Commission to develop a casino/hotel on the Property, (b) the date on which the Debenture is converted in full, (c) the date on which the Debenture is paid in full, or (d) the Final Maturity Date of the Debenture (as defined in the Debenture). Since the issuance of the Debentures, there have been no events that would trigger the above anti-dilution provisions. When originally issued, in the event the Company failed to meet the conditions for conversion of the Debentures, the First Tranche Convertible Debentures, which total $950,000, would have been due on March 31, 2020 and the Second Tranche Convertible Debentures, which total $850,000, would have been due December 31, 2020. The sole remaining non-convertible Debenture in the amount of $50,000 would have been due March 31, 2020. However, the Company is in default with respect to interest payments due under the Debenture agreements in the amount of $371,581 and as a result, the Debentures payable are reported as current liabilities. Certain Debenture holders sued the Company for failing to make payments due under the terms of the Debentures and the case was settled. See Note 15 below. Total accrued interest due on all outstanding Debentures amounted to $371,581 and $353,233 at March 31, 2020 and December 31, 2019, respectively. |
Short Term Notes and Interest B
Short Term Notes and Interest Bearing Advance | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Short Term Notes and Interest Bearing Advance | Note 7. Short Term Notes and Interest Bearing Advance Promissory Note On June 9, 2017, the Company entered into a Promissory Note with an unrelated lender in exchange for proceeds in the amount of $15,000. Interest on the note is 12.5% per annum and payable March 1 of each year the note remains outstanding. Payment in full of the Note is due June 9, 2019. Mississippi Gaming Corporation, a wholly owned subsidiary of the Company, guaranteed the Note. In addition, the President of the Company agreed to personally guarantee the Note and to personally secure the Note with an assignment of proceeds due to her under the first lien on the Diamondhead property. The interest payment, which was due March 1, 2018, was not made. Accrued interest due on this obligation amounted to $5,276 and $4,803 at March 31, 2020 and December 31, 2019, respectively. Bank Credit Facility Wells Fargo Bank provides an unsecured credit facility of up to $15,000 to the Company. The facility requires a variable monthly payment of amounts borrowed plus interest, which is applied at 11.24% on direct charges and 24.99% on any cash advanced through the facility. At , a principal balance of $18,004 remained outstanding on the facility. The lending bank has since cancelled privileges under the facility for non-payment. Interest Bearing Advances In 2016, the Company received cash advances totaling $47,500 from seven lenders which included $22,500 from third parties (see Note 8 for related party advances). 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. Accrued interest due on the above notes amounted to $9,800 and $7,600 at March 31, 2020 and December 31, 2019, respectively. On February 2, 2017, the Company borrowed $25,000 from an unrelated third party. The Note carries an annual interest rate of approximately 12.5% and is past due. The Company is in default and as such, the lender may increase the interest rate due by an amount of up to 3% per annum in excess of the rate then otherwise applicable. The Company does not have the funds to repay the advance. 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 Property. Accrued interest on this obligation amounted to $9,880 and $9,092 at March 31, 2020 and December 31, 2019, respectively. The above short-term notes and interest-bearing advances total $80,504 in aggregate and all are in default under the original agreed to terms. |
Current Notes Payable Due to Re
Current Notes Payable Due to Related Parties | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Current Notes Payable Due to Related Parties | Note 8. Current Notes Payable Due to Related Parties In 2016, the Company received cash advances totaling $47,500 from seven lenders which included $25,000 from three Current Directors of the Company (see Note 7). 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. Accrued interest due on the above notes amounted to $10,000 and $8,000 at March 31, 2020 and December 31, 2019, respectively. These amounts are included in current liabilities on the unaudited condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019. This note is secured by the second lien. In July 2017, at the request of the Company, the current Chairman of the Board of Directors, who is also a Vice President of the Company (“the Chairman”), paid all property taxes due, together with all interest due thereon, to Hancock County, Mississippi on an approximate 400-acre tract of land, owned by Mississippi Gaming Corporation, a wholly-owned subsidiary of the Company. The total amount advanced was $67,628. The Chairman is one of the secured parties under that Land Deed of Trust recorded on September 26, 2014 in Hancock County, Mississippi, to secure Tranche I and Tranche II Debentures issued by the Company in 2014. Under paragraph 5 of the Land Deed of Trust, a secured party who advances sums for taxes due on the Property is secured by the same Land Deed of Trust, but only at that interest rate specified in the note representing the primary indebtedness, namely 4% per annum. The Chairman advanced the $67,628 on condition that: (is) the advance constitute a lien with interest at 4% per annum under that Land Deed of Trust recorded September 26, 2014; (ii) he be paid additional interest of 11% per annum on the amount advanced and owing and that the full 11% interest per annum is payable during any calendar year in which all or part of the amount advanced and owing or interest due thereon remains unpaid; (iii) this additional interest obligation be treated as a separate and secured debt of the Company, to be evidenced by a separate note and is secured with a separate and third lien to be placed on the Property (hereafter “the Third Lien”); (iv) the entire obligation will be treated as an advance to be paid out of any subsequent incoming financing obtained by the Company or any amounts recovered by the Company from a defendant in that collection action brought by the Company in the Circuit Court of Montgomery County, Maryland; and (v) he be indemnified for any losses sustained on the sale of that common stock sold to cover the payment of real estate property taxes and any credit card fees associated with payment. The Chairman has identified the common stock to be sold and will provide the Company with the documentation required to document the sale of said stock and to calculate the future loss, if any, on said stock. The fair value measurement of the derivative indemnification liability at March 31, 2020 and December 31, 2019 was developed using Level 1 inputs, which was valued at $0. On June 30, 2018, Mississippi Gaming Corporation issued a secured promissory note, due one year from the date of issue, to the Chairman for an amount up to $100,000 to cover the principal and interest due with respect to this note. On August 21, 2018, Mississippi Gaming Corporation placed a third lien on the Property to secure this obligation for $100,000. Accrued interest on the note amounted to $37,012 and $28,906 at March 31, 2020 and December 31, 2019, respectively. In March of 2018, the Board of Directors voted to increase up to an additional $200,000 the amount secured by the third lien in favor of the Chairman of the Board, for amounts advanced by the Chairman on behalf of the Company, on the following terms and conditions, namely, that (is) the advance constitutes a lien on the Property with interest at 15% per annum; (ii) that the full interest of 15% per annum is payable during any calendar year in which all or part of the amount advanced is due and owing or interest due thereon remains unpaid; (iii) that this debt be evidenced by a separate promissory note and is to be included in and secured with a third lien that is to be placed on the Diamondhead Property to secure previous advances made to the Company (hereafter “the Third Lien”); (iv) that he be indemnified for any losses sustained on the sale of his common stock in an unrelated publicly-traded company to be sold to cover this advance based on a sales price of approximately $2.80 per share with a cap on the maximum loss per share to be at a sales price of $10.00 per share; and (v) that the Chairman’s previous indemnification approved by the Board of Directors on July 24, 2017 with respect to any loss on the sale of the same stock also be capped at a maximum of $10.00 per share. The Chairman will provide the Company with the documentation required to document the sale of said stock and to calculate the losses on said stock for all amounts loaned to the Company from the sale of said stock. On June 30, 2018, Mississippi Gaming Corporation issued a secured promissory note, due one year from the date of issue to the Chairman, for an amount up to $200,000 to cover the principal and interest due with respect to this note. On August 21, 2018, Mississippi Gaming Corporation placed a third lien on the Diamondhead Property to secure this obligation for $200,000. In November of 2018, the Board of Directors voted to increase up to an additional $100,000 of advances from the Chairman and in March of 2019, the Board of Directors voted to increase the limit of the advances to $200,000. The terms of this advance are identical to the terms as approved above in March 2018. At March 31, 2020, the Chairman had advanced a total of $398,274, net of repayment of $16,250, under both the March 2018 and March 2019 arrangements and was owed accrued interest in the amount of $129,981 and $80,384 at March 31, 2020 and December 31, 2019, respectively. On July 24, 2017, the President of the Company, who is a Director of the Company, agreed to advance the Company up to $20,000 for the payment of expenses. In March of 2018, the Board of Directors voted to increase to up to $100,000 the amount to be secured by a third lien in favor of the President of the Company for amounts advanced by the President under this note, on the following terms and conditions, namely, that (i) she be paid interest of 15% per annum on the amount advanced and owing and that the full 15% interest per annum is payable during any calendar year in which all or part of the amount advanced and owing or interest due thereon remains unpaid; (ii) the obligation in the maximum principal amount of $100,000 with interest due thereon be treated as a secured debt of the Company, to be evidenced by a separate note and to be secured with a separate lien to be placed on the Diamondhead Property (“the Third Lien”) together with the Chairman’s Third Lien, as well as a first lien to be placed on the residential lot owned by the Company; (iii) that the Third Lien on the Diamondhead Property also include the two loans ($25,000 and $15,000) and interest due thereon and credit facilities in the maximum amount of $15,000; and (iv) that the foregoing will be treated as advances to be paid out of any subsequent incoming financing obtained by the Company or any amounts recovered by the Company from a defendant in that collection action brought by the Company in the Circuit Court of Montgomery County, Maryland. As of March 31, 2020, the President had advanced a total of $41,162, net of repayments of $19,917, under this agreement. The President previously agreed to secure a $25,000 loan and interest due thereon and to secure and guarantee a $15,000 loan and interest due thereon due non-related parties discussed above. The President is also personally liable for certain bank-issued credit cards used by the Company to pay expenses incurred by the Company in the approximate amount of $18,000. On June 30, 2018, Mississippi Gaming Corporation issued a secured promissory note, due one year from date of issue, to the President for an amount up to $100,000 to cover the principal and interest due with respect to this note. On August 21, 2018, Mississippi gaming Corporation placed a third lien on the Diamondhead Property to secure this obligation for $100,000. Accrued interest due on this note amounted to $20,452 and $14,278 at March 31, 2020 and December 31, 2019, respectively. The third lien placed on the Diamondhead Property, which secures the above three promissory notes, totals up to $400,000 and is payable to the Chairman of the Board ($300,000) and President ($100,000) of the Company. The principal balance of the notes payable to the officers and directors discussed above were due in September 2019 and totaled $439,436 and $437,321 in aggregate, at March 31, 2020 and December 31, 2019, respectively. In 2016, the Chairman of the Board of Directors of the Company loaned the Company $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. Accrued interest due on the above note amounted to $46,188 and $ 43,082 at March 31, 2020 and December 31, 2019, respectively. The note is currently in default. |
Long-Term Notes Payable Due Oth
Long-Term Notes Payable Due Others | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Notes Payable Due Others | Note 9. Long-Term Notes Payable Due Others In October 2017, the Company entered into a settlement with a holder of $150,000 of convertible notes as described in Note 5 above. As part of the settlement, the Company agreed to pay legal fees in the amount of $50,000 and issued a four year note at 0% interest to satisfy this obligation. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 10. Related Party Transactions As of March 31, 2020, the President of the Company is owed deferred salary in the amount of $2,541,996 and the 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 $57,990 and $51,333 during the three months ended March 31, 2020 and 2019, respectively. Total interest accrued under this agreement totaled $1,152,429 and $1,094,439 as of March 31, 2020 and December 31, 2019, respectively. The Company has 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 $6,088 for a total of $19,690 for the three months ended March 31, 2020 and base rent of $13,602 and associated rental costs of $5,042 for a total of $18,644 for the three months ended March 31, 2019. No payments associated with the base rents were made in the quarter ended March 31, 2020. At March 31, 2020 and December 31, 2019, amounts owing for base rent and associated rental costs totaled $341,470 and $321,780, 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 $591,250 and $568,750 was due and owing to the Company’s current and former directors as of March 31, 2020 and December 31, 2019, 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. See Notes 4, 5, 7, 8, 9 and 11 for other related party transactions. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11. Commitments and Contingencies Liens As of March 31, 2020, there were three liens on the Company’s Diamondhead, Mississippi Property as follows: The Company’s obligations under the Collateralized Convertible Senior Debentures are secured by a first lien on the Company’s Diamondhead, 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, on September 26, 2014, a first lien was placed on the Diamondhead Property in favor of the Investors to secure the principal due in the amount of $1,850,000 and interest due thereon. The Investors Lien is in pari passu On December 16, 2016, the Company filed a second lien on the Diamondhead Property in the maximum amount of $250,000 to secure certain notes payable, including notes to related parties, totaling $137,500 in principal and accrued interest incurred. On August 21, 2018, the Company filed a third lien on the Diamondhead Property for up to $400,000 to secure notes issued to the Chairman and President of the Company arising in the third quarter of 2017 and during 2018, as more fully described in Notes 8. Other The Company is currently delinquent in filing those documents and forms required to be filed in connection with its Employee Stock Ownership Plan (“ESOP”) for the year ended December 31, 2019, 2018, 2017, 2016 and 2015. The Company did not have the funds to pay professionals to prepare, audit and file these 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 significant penalties for failure to file these forms when due. Penalties are assessed by the Department of Labor on a per diem basis from the original due dates for the required informational filings until the filings are actually made. The Company has accrued $158,500 and $140,100 on the current delinquent filings as of March 31, 2020 and December 31, 2019, respectively. 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 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 not filed its consolidated federal tax returns for the years ended December 31, 2019, 2018, 2017 and 2016. The Company believes no tax is due with that return. Casino World, Inc. a wholly owned subsidiary of the Company, is delinquent with respect to the filing of their franchise tax annual reports for 2019, 2018, 2017 and 2016 with the state of Delaware and the state of Mississippi. Management Agreement On June 19, 1993, two subsidiaries of the Company, Casino World Inc. and Mississippi Gaming Corporation, entered into a Management Agreement with Casinos Austria Maritime Corporation (CAMC). Subject to certain conditions, under the Management Agreement, CAMC would operate, on an exclusive basis, all of the Company’s proposed dockside gaming casinos in the State of Mississippi, including any operation fifty percent (50%) or more of which is owned by the Company or its affiliates. Unless terminated earlier pursuant to the provisions of the Agreement, the Agreement terminates five years from the first day of actual Mississippi gaming operations and provides for the payment of an annual operational term management fee of 1.2% of all gross gaming revenues between zero and $100,000,000; plus 0.75% of gross gaming revenue between $100,000,000 and $140,000,000; plus 0.5% of gross gaming revenue above $140,000,000; plus two percent of the net gaming revenue between zero and $25,000,000; plus three percent of the net gaming revenue above twenty-five million dollars $25,000,000. The Company believes this Agreement is no longer in effect. However, there can be no assurance that CAMC will not attempt to maintain otherwise which would lead to litigation. |
Pending and Threatened Litigati
Pending and Threatened Litigation | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Pending and Threatened Litigation | Note 12. Pending and Threatened Litigation CASE SETTLED 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-LPS) On October 25, 2016, the above-named Debenture holders filed a Complaint against Diamondhead Casino Corporation (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 were 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 filed with the court. On September 26, 2017, the motion for leave to amend was granted and the Company’s motion to dismiss was granted in part and denied in part. The Court also granted plaintiffs leave to file a Second Amended Complaint which was filed on October 2, 2017. On October 16, 2017, the Company filed Defendant’s Answer and Affirmative Defenses and Counterclaim. On November 2, 2017, the Plaintiffs filed an Answer to the Counterclaim. The parties exchanged discovery in the case. On September 27, 2018, the Plaintiffs’ filed a motion for summary judgment. On October 18, 2018, the Company filed its opposition to the motion for summary judgment. On November 8, 2018, the Plaintiff’s filed their reply to the Company’s opposition. On January 2, 2019, the Court canceled the trial previously scheduled for March 22, 2019. On April 2, 2019, the Court heard argument on the Plaintiff’s motion for summary judgment. On June 4, 2019, the Court denied Plaintiffs’ motion for summary judgment. On June 14, 2019, the Plaintiffs filed a motion for leave to file a third amended complaint. On June 26, 2019, the Company filed an opposition to the motion. On July 1, 2019, the plaintiffs filed their reply. On July 24, 2019, the Court denied the motion for leave to amend without prejudice. On June 7, 2019, the Court scheduled a mediation conference for July 11, 2019. At the mediation conference the parties reached a settlement. On December 12, 2019, the parties entered into a written Settlement Agreement. The Settlement Agreement, in addition to other terms and conditions provides, in pertinent part, as follows: i) in the event Mississippi Gaming Corporation (“MGC”) entered into a contract for the sale of the Diamondhead Property on or before December 31, 2019, the Plaintiffs would be paid the principal due under the debentures and interest stated in the debentures of four percent (4%) per annum through the payment date; ii) in the event MGC entered into a contract for the sale of the Property on or before June 30, 2020, the Plaintiffs would be paid the principal due under the debentures, interest of four percent (4%) per annum through December 31, 2019 and, beginning January 1, 2020, interest of five percent (5%) per annum through the payment date; iii) in the event MGC has not entered into a contract for the sale of the Property on or before June 30, 2020, but has done so on or before December 31, 2021, the Plaintiffs would be paid the principal due under the debentures, interest of four percent (4% ) per annum through December 31, 2019 and, beginning January 1, 2020, interest of six percent (6%) per annum through the payment date; and iv) if MGC has not entered into a contract for the sale of the Property on or before December 31, 2021, the Plaintiffs will be entitled to a Judgment for the principal due under the debentures, interest of four percent (4%) per annum through December 31, 2019 and, beginning January 1, 2020, interest of six percent (6%) per annum through the date of Judgment. Following entry of Judgment, interest will accrue at the then post-judgment rate of interest charged pursuant to the laws of the State of Delaware. There is a provision for the payment of reasonable attorneys fees to counsel for Plaintiffs in the event MGC has not entered into a contract for the sale of the Property on or before December 31, 2019. If the parties cannot agree on the amount that constitutes reasonable attorneys fees, the parties will submit the matter to the Court for determination, but in no event will such fees exceed $160,000 unless there is a default in the Settlement Agreement. On January 13, 2020, the parties filed a Stipulation of Voluntary Dismissal with Prejudice in the case. The principal and interest pertaining to the settlement above has been accrued through March 31, 2020. CASE SETTLED John Hawley, as servicing agent for Argonaut 2000 Partners, L.P. v. Diamondhead Casino Corporation On February 28, 2019, the above-named Debenture holder filed a Complaint against the Company in the Superior Court of the State of Delaware for monies due and owing pursuant to certain Collateralized Convertible Senior Debentures issued on March 31, 2014 and December 31, 2014. The plaintiff was seeking $100,000, plus interest from January 1, 2015, together with costs and fees. The Company was served with the Complaint on March 8, 2019. On March 28, 2019, the Company filed its Answer, Affirmative Defenses and Counterclaim and Affidavit of Defense. The plaintiff in this case is represented by the same law firms that represent plaintiffs in the above-referenced case. Thus, at the mediation conference held on July 11, 2019 in the above case, the parties agreed that the same settlement agreement reached in that case would apply to the plaintiff in this case as well. A Stipulation of Dismissal With Prejudice was filed in the case on January 13, 2020. The principal and interest pertaining to the settlement above has been accrued through March 31, 2020. CASE SETTLED Sussman v. Diamondhead Casino Corporation In November 2016, the Company filed a Foreign Judgment with the Circuit Court of Montgomery County, Maryland to collect a judgment that had been entered against Plaintiff and other Petitioners who had filed a Chapter 7 Involuntary Bankruptcy Petition against the Company in the United States Bankruptcy Court for the District of Delaware. The Bankruptcy Court found that the Petition had been filed in bad faith and for improper purposes and awarded the Company attorney’s fees. In February 2017, the Plaintiff filed a Motion to Reopen and Vacate the Foreign Judgment. The Circuit Court entered judgment in favor of the Company and ordered the Plaintiff to post a cash bond with the Court in the amount of $36,000. The Plaintiff appealed the lower court’s decision to the Court of Special Appeals of Maryland which affirmed the decision. The Plaintiff then filed a Petition for Writ of Certiorari in the Court of Appeals of Maryland which denied the Petition. In March 2019, the Company collected the $36,000. CASE DECIDED Arnold J. Sussman, Robert Skaff and David J. Towner v. Diamondhead Casino Corporation On November 9, 2018, Sussman filed suit against the Company for breach of a Promissory Note issued November 10, 2010, in the principal amount of $50,000, with interest payable at 9% per annum, with a maturity date of November 10, 2012. Plaintiff sought payment of principal of $50,000 and interest due from June 30, 2012 to present. On November 28, 2018, Skaff and Towner also filed suit against the Company in the same court for breach of Promissory Notes (Case No. N18C-11-232 ALR). Skaff filed suit i) for breach of a note issued on November 29, 2010 in the principal amount of $37,500 with interest payable at 9% per annum, with a maturity date of November 29, 2012 and ii) for breach of a note issued on June 21, 2011, in the principal amount of $25,000 with interest payable at 9% per annum, with a maturity date of June 21, 2013. Towner filed suit for breach of a note issued on November 29, 2010, in the principal amount of $25,000 with interest payable at 9% per annum, with a maturity date of November 29, 2012. The cases were consolidated for hearing and trial. On February 15, 2019, the Plaintiffs filed their Consolidated Complaint. On March 7, 2019, the Company filed its Answer and Affirmative Defenses and Affidavit of Defense. On or about April 1, 2020, the Plaintiffs filed a motion for summary judgment and a brief in support thereof. The Company filed a brief in opposition. On July 13, 2020, the Court heard oral argument on the motion. On November 13, 2020, the Court granted Plaintiffs’ motion for summary judgment. On December 4, 2020, the Court entered a Final Order and Judgment in the case awarding judgment to Plaintiffs as follows: i) Sussman: $88,151.46; ii) Skaff: $109,978.93; and iii) Towner: $44,127.68. Post-judgment interest was awarded in accordance with the legal rate in Delaware (5% plus the federal discount rate). The principal and interest pertaining to the settlement above has been accrued through March 31, 2020. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13. Subsequent Events On November 6, 2020, the Board of Directors of the Company voted to extend to December 31, 2023, a total of 2,965,000 options to purchase common stock previously awarded to officers, directors and current and former employees of the Company. The options were scheduled to expire on December 31, 2020. On November 9, 2020, the Board of Directors voted to award 1,290,000 options to purchase common stock to its six current directors, including three officers of the Company, at a strike price of $0.46 per share with an expiration date of December 31, 2023, as follows: Martin Blount: 200,000; Daniel Burstyn: 40,000; Robert Crow: 100,000; Benjamin Harrell: 360,000; Gregory Harrison: 450,000 and Deborah Vitale: 140,000. All options are vested. In January 2021, a fourth lien in the amount of $2,000,000 was placed on the Property to secure a non-interest-bearing note payable in the amount of $2,000,000, issued to secure amounts owed to the President of the Company for accrued, but unpaid, salary, rent and other expenses. In February 2021, a fifth lien in the amount of $658,750 was placed on the Property to secure a non-interest-bearing note payable in the amount of $658,750, issued to secure amounts owed to nine directors, including the Company’s six current directors. In April 2021, six liens were placed on the Property to secure six non-interest-bearing notes payable to be issued to six lenders bringing total liens on the Property to eleven. The six notes issued total $252,500 in principal and call for the issuance of 250,000 shares of common stock. The notes are not convertible. As of the issuance date of these financial statements, no shares have been issued. The Company intends to place a twelfth and thirteenth lien on the Property in the second quarter of 2021 to secure two non-interest bearing notes issued in May of 2021 which total $50,000 in principal and call for the issuance of a total of 100,000 shares of common stock. The notes are not convertible. As of the issuance date of these financial statements, no shares have been issued. In July 2020, the Chairman of the Board of the Company paid a total of $67,076 for property taxes due for the year 2019 on the Company’s 400-acre Diamondhead, Mississippi Property plus $1,573 in related fees. The Company intends to place a fourteenth lien on the Property in the third quarter of 2021 to secure a promissory note in the amount of $150,000 issued to the Chairman of the Board of the Company to secure the payment of these taxes and interest due thereon. In May 2021, the Chairman of the Board of the Company paid a total of $62,610 for property taxes due for the year 2020 on the Company’s 400-acre Diamondhead, Mississippi Property plus $1,468 in related fees. The Company intends to place a fifteenth lien on the Property in the third quarter of 2021 to secure a promissory note in the amount of $100,000 issued to the Chairman of the Board of the Company to secure the payment of these taxes and interest due thereon. In May of 2021, the Chairman of the Board of the Company loaned the Company $50,000 on the same terms and conditions as loans made by certain unrelated third parties in 2020 and 2021. The Company intends to place a sixteenth lien on the Property in the third quarter of 2021 to secure this non-interest bearing note which totals $50,000 in principal and calls for the issuance of 100,000 shares of common stock. The notes are not convertible. As of the issuance date of these financial statements, no shares have been issued. Through the issuance date of this report, the President advanced additional funds totaling $12,489. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
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 | Land Land held for development is carried at cost. Costs directly related to site development, such as licensing, permitting, engineering, and other costs, are capitalized. Land development costs, which have been capitalized, consist of the following at March 31, 2020 and December 31, 2019: Land $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 Total land $ 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 management’s own assumptions. The fair value measurement of the derivative indemnification liability at March 31, 2020 and December 31, 2019 listed in Note 4 below was developed using Level 1 inputs. |
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 long-lived 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, 2020. |
Net Loss Per Common Share | Net Loss per Common Share Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding. Diluted earnings per share is calculated by using the weighted average number of common shares outstanding, plus other potentially dilutive securities. Potentially dilutive securities are excluded from the computation of diluted loss per shares since their effect would be antidilutive. 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, 2020 and 2019. March 31, March 31, Description 2020 2019 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,415,000 Convertible Promissory Notes 1,925,000 1,925,000 Total 5,600,000 5,600,000 |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740)(“ASU 2019-12”) No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company’s present or future financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Land Development Cost Capitalized | Land development costs, which have been capitalized, consist of the following at December 31, 2019 and 2018: Land held for development $ 4,934,323 Licenses 77,000 Engineering and costs associated with permitting 464,774 $ 5,476,097 |
Schedule of Components of Potential Dilutive Securities | The table below summarizes the components of potential dilutive securities at December 31, 2019 and 2018. Description December 31, 2019 December 31, 2018 Convertible Preferred Stock 260,000 260,000 Options to Purchase Common Shares 3,415,000 3,415,000 Convertible Promissory Notes 1,925,000 1,925,000 Total 5,600,000 5,600,000 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | The table below outlines the elements included in accounts payable and accrued expenses at March 31, 2020 and December 31, 2019: March 31, December 31, Description 2020 2019 Related parties: Accrued payroll due officers $ 2,744,711 $ 2,669,711 Accrued interest due officers and directors 1,461,601 1,336,626 Accrued director fees 591,250 568,750 Base rents due to the President 253,652 240,050 Associated rental costs 87,818 81,730 Other 17,308 17,308 Total related parties $ 5,156,340 $ 4,914,175 Non-related parties: Accrued interest $ 2,077,354 $ 2,006,545 Accrued dividends 889,000 863,600 Accrued fines and penalties 158,500 140,100 Other 334,016 263,115 Total non-related parties $ 3,458,870 3,273,360 |
Convertible Notes and Line of_2
Convertible Notes and Line of Credit (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Notes Payable | The table below summarizes the Company’s debt arising from the above-described sources as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Private placements - March 1, 2010* $ 475,000 $ 475,000 Private placements - October 25, 2010 487,500 487,500 $ 962,500 $ 962,500 *Of the 2010 placements above, $75,000 is due to a related party. |
Organization and Business (Deta
Organization and Business (Details Narrative) | Mar. 31, 2020a |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Area of land, owned | 400 |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Net loss applicable to common stockholders | $ (438,835) | $ (1,032,408) | |
Accumulated deficit | (39,887,054) | $ (39,448,219) | |
Accounts payable and accrued expenses | 8,615,210 | ||
Cash on hand | $ 234 | $ 1,966 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Impairment of long-lived assets | ||
Antidilutive securities excluded from computation of earnings per share | 5,600,000 | 5,600,000 |
Convertible Debentures [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 5,055,555 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Land Development Cost Capitalized (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Total Land | $ 5,476,097 | $ 5,476,097 |
Land [Member] | ||
Total Land | 4,934,323 | 4,934,323 |
Licenses [Member] | ||
Total Land | 77,000 | 77,000 |
Engineering and Costs Associated With Permitting [Member] | ||
Total Land | $ 464,774 | $ 464,774 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Components of Potential Dilutive Securities (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total | 5,600,000 | 5,600,000 |
Convertible Preferred Stock [Member] | ||
Total | 260,000 | 260,000 |
Options to Purchase Common Shares [Member] | ||
Total | 3,415,000 | 3,415,000 |
Convertible Promissory Notes [Member] | ||
Total | 1,925,000 | 1,925,000 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Accrued payroll due officers | $ 2,744,711 | $ 2,669,711 |
Accrued interest due officers and directors | 1,461,601 | 1,336,626 |
Accrued director fees | 591,250 | 568,750 |
Base rents due to the President | 253,652 | 240,050 |
Associated rental costs | 87,818 | 81,730 |
Other | 17,308 | 17,308 |
Total related parties | 5,156,340 | 4,914,175 |
Accrued interest | 2,077,354 | 2,006,545 |
Accrued dividends | 889,000 | 863,600 |
Accrued fines and penalties | 158,500 | 140,100 |
Other | 334,016 | 263,115 |
Total non-related parties | $ 3,458,870 | $ 3,273,360 |
Convertible Notes and Line of_3
Convertible Notes and Line of Credit (Details Narrative) - USD ($) | Oct. 25, 2010 | Mar. 01, 2010 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2008 | Nov. 30, 2020 | Oct. 31, 2017 | Sep. 26, 2014 |
Line of credit facility, maximum borrowing capacity | $ 1,000,000 | |||||||
Line of credit interest rate | 9.00% | |||||||
Debt instrument, maturity date | Nov. 1, 2012 | |||||||
Debt instrument, interest rate, stated percentage | 4.00% | |||||||
Convertible notes | $ 1,962,500 | $ 1,962,500 | ||||||
Private Placement [Member] | ||||||||
Convertible notes | 962,500 | 962,500 | ||||||
Line of Credit [Member] | ||||||||
Number of options awarded | 50,000 | |||||||
Share-based compensation arrangement by share-based payment award, options, vested, weighted average grant date fair value | $ 1.75 | |||||||
Line of credit, principal and accrued interest | 1,965,614 | 1,943,422 | ||||||
Line of Credit [Member] | Lender [Member] | Maximum [Member] | ||||||||
Number of options awarded | 250,000 | |||||||
Share-based compensation arrangement by share-based payment award, options, vested, weighted average grant date fair value | $ 1.75 | |||||||
Convertible Promissory Note [Member] | ||||||||
Debt instrument, face amount | $ 150,000 | |||||||
Convertible Promissory Note [Member] | March 1, 2010 Private Placement [Member] | ||||||||
Debt instrument, term | 2 years | |||||||
Debt instrument, face amount | $ 25,000 | |||||||
Debt instrument, interest rate, stated percentage | 12.00% | |||||||
Debt instrument, convertible, number of equity instruments | 50,000 | |||||||
Debt instrument, convertible, terms of conversion feature | The Promissory Notes were convertible into 50,000 shares of common stock of the Company upon issuance and for a period of five years at the option of the investor. | |||||||
Convertible Promissory Note [Member] | October 25, 2010 Private Placement [Member] | ||||||||
Debt instrument, term | 2 years | |||||||
Debt instrument, face amount | $ 25,000 | |||||||
Debt instrument, interest rate, stated percentage | 9.00% | |||||||
Debt instrument, convertible, number of equity instruments | 50,000 | |||||||
Debt instrument, convertible, terms of conversion feature | Convertible into 50,000 shares of common stock of the Company upon issuance and for a period of five years at the option of the investor. The conversion rights have expired. | |||||||
Convertible notes | 487,500 | 487,500 | ||||||
Convertible Promissory Note [Member] | Private Placement [Member] | ||||||||
Convertible notes | 962,500 | 962,500 | ||||||
Accrued interest | $ 779,647 | $ 754,991 | ||||||
Convertible Promissory Note [Member] | Private Placement [Member] | Subsequent Event [Member] | ||||||||
Debt instrument principal and interest | $ 486,796 |
Convertible Notes and Line of_4
Convertible Notes and Line of Credit - Schedule of Convertible Notes Payable (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 | |
Convertible notes payable | $ 1,962,500 | $ 1,962,500 | |
March 1, 2010 Private Placement [Member] | Convertible Promissory Note [Member] | |||
Convertible notes payable | [1] | 475,000 | 475,000 |
October 25, 2010 Private Placement [Member] | Convertible Promissory Note [Member] | |||
Convertible notes payable | 487,500 | 487,500 | |
Private Placement [Member] | |||
Convertible notes payable | 962,500 | 962,500 | |
Private Placement [Member] | Convertible Promissory Note [Member] | |||
Convertible notes payable | $ 962,500 | $ 962,500 | |
[1] | Of the 2010 placements above, $75,000 is due to a related party. |
Convertible Notes and Line of_5
Convertible Notes and Line of Credit - Schedule of Convertible Notes Payable (Details) (Parenthetical) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
March 1, 2010 Private Placement [Member] | Convertible Promissory Note [Member] | ||
Due to a related party | $ 75,000 | $ 75,000 |
Convertible Debentures Payable
Convertible Debentures Payable (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2008 | Dec. 31, 2019 | Sep. 26, 2014 | |
Debt instrument, interest rate, stated percentage | 4.00% | |||
Convertible debenture payable | $ 1,792,346 | $ 1,785,269 | ||
Debt maturity date | Nov. 1, 2012 | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | ||||
Maximum offering amount | 3,000,000 | |||
Debt instrument face amount | $ 3,000,000 | |||
Debt instrument, interest rate, stated percentage | 4.00% | |||
Debt instrument, maturity date, description | Mature six years from the date of issuance | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | Tranche 1 [Member] | ||||
Collateralized convertible senior debentures | $ 1,000,000 | |||
Conversion of debenture into shares of common stock | 3,333,333 | |||
Debt instrument, convertible, conversion price | $ 0.30 | |||
Convertible debenture payable | $ 950,000 | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | Tranche 2 [Member] | ||||
Collateralized convertible senior debentures | $ 1,000,000 | |||
Conversion of debenture into shares of common stock | 2,222,222 | |||
Debt instrument, convertible, conversion price | $ 0.45 | |||
Convertible debenture payable | $ 850,000 | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | Tranche 3 [Member] | ||||
Collateralized convertible senior debentures | $ 1,000,000 | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | Tranche 3 [Member] | Minimum [Member] | ||||
Conversion of debenture into shares of common stock | 1,818,182 | |||
Debt instrument, convertible, conversion price | $ 0.55 | |||
February 14, 2014 Private Placement [Member] | Convertible Senior Debentures [Member] | Tranche 3 [Member] | Maximum [Member] | ||||
Conversion of debenture into shares of common stock | 1,333,333 | |||
Debt instrument, convertible, conversion price | $ 0.75 | |||
February 14, 2014 Private Placement [Member] | Non-convertible Senior Debentures [Member] | ||||
Convertible debenture payable | $ 50,000 | |||
Debentures [Member] | ||||
Debt instrument face amount | $ 371,581 | |||
Third Tranche Debentures [Member] | ||||
Debt maturity date | Mar. 31, 2020 | |||
Convertible Debentures [Member] | ||||
Accrued interest due | $ 371,581 | $ 353,233 |
Short Term Notes and Interest_2
Short Term Notes and Interest Bearing Advance (Details Narrative) - USD ($) | Jun. 09, 2017 | Feb. 02, 2017 | Aug. 25, 2016 | Dec. 31, 2016 | Dec. 31, 2008 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 26, 2014 |
Debt interest rate | 4.00% | |||||||
Debt instrument, maturity date | Nov. 1, 2012 | |||||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000 | |||||||
Short term borrowings | $ 80,504 | $ 80,504 | ||||||
Seven Lenders [Member] | ||||||||
Cash received advances | $ 47,500 | |||||||
Three Current Directors [Member] | ||||||||
Cash received advances | $ 22,500 | |||||||
Seven Lenders and Three Current Directors [Member] | ||||||||
Debt interest rate | 8.00% | |||||||
Accrued interest | 9,800 | 7,600 | ||||||
Debt matures term | 4 years | |||||||
Lender [Member] | ||||||||
Increase in interest rate per annum | 3.00% | |||||||
Unrelated Third Party [Member] | ||||||||
Debt interest rate | 12.50% | |||||||
Accrued interest | 9,880 | 9,092 | ||||||
Short term borrowings | $ 25,000 | |||||||
Promissory Note [Member] | ||||||||
Proceeds from notes payable | $ 15,000 | |||||||
Debt interest rate | 12.50% | |||||||
Debt instrument, maturity date | Jun. 9, 2019 | |||||||
Accrued interest | 5,276 | 4,803 | ||||||
Bank Credit Facility [Member] | ||||||||
Line of credit facility, maximum borrowing capacity | 15,000 | |||||||
Line of credit | $ 18,004 | $ 18,004 | ||||||
Bank Credit Facility [Member] | Direct Charges [Member] | ||||||||
Line of credit, interest rate | 11.24% | |||||||
Bank Credit Facility [Member] | Cash Advanced Through Facility [Member] | ||||||||
Line of credit, interest rate | 24.99% |
Current Notes Payable Due to _2
Current Notes Payable Due to Related Parties (Details Narrative) | Aug. 21, 2018USD ($) | Jun. 30, 2018USD ($) | Jul. 24, 2017USD ($) | Jun. 09, 2017 | Aug. 25, 2016 | Aug. 25, 2016 | Mar. 31, 2018USD ($) | Jul. 31, 2017USD ($)a | Mar. 31, 2020USD ($)a | Mar. 31, 2019USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2019USD ($) | Nov. 30, 2018USD ($) | Sep. 26, 2014 |
Debt instrument, interest rate, stated percentage | 4.00% | ||||||||||||||
Area of land, owned | a | 400 | ||||||||||||||
Repayment of related party debt | $ 36,167 | ||||||||||||||
Proceeds from related parties | 2,115 | $ 60,408 | |||||||||||||
Credit facilities, maximum amount | $ 1,000,000 | ||||||||||||||
Debt instrument, maturity date | Nov. 1, 2012 | ||||||||||||||
Notes payable to officers and directors | 554,436 | $ 552,321 | |||||||||||||
Promissory Note [Member] | |||||||||||||||
Debt instrument, interest rate, stated percentage | 12.50% | ||||||||||||||
Accrued interest due | 5,276 | 4,803 | |||||||||||||
Debt instrument, maturity date | Jun. 9, 2019 | ||||||||||||||
Mississippi Gaming Corporation [Member] | Secured Promissory Note [Member] | |||||||||||||||
Accrued interest due | 37,012 | 28,906 | |||||||||||||
Chairman [Member] | |||||||||||||||
Debt instrument, interest rate, stated percentage | 15.00% | ||||||||||||||
Debt instrument, face amount | $ 200,000 | $ 100,000 | |||||||||||||
Terms on advances from chairman description | The advance constitutes a lien on the Property with interest at 15% per annum; (ii) that the full interest of 15% per annum is payable during any calendar year in which all or part of the amount advanced is due and owing or interest due thereon remains unpaid; (iii) that this debt be evidenced by a separate promissory note and is to be included in and secured with a third lien that is to be placed on the Diamondhead Property to secure previous advances made to the Company (hereafter "the Third Lien"); (iv) that he be indemnified for any losses sustained on the sale of his common stock in an unrelated publicly-traded company to be sold to cover this advance based on a sales price of approximately $2.80 per share with a cap on the maximum loss per share to be at a sales price of $10.00 per share; and (v) that the Chairman's previous indemnification approved by the Board of Directors on July 24, 2017 with respect to any loss on the sale of the same stock also be capped at a maximum of $10.00 per share. The Chairman will provide the Company with the documentation required to document the sale of said stock and to calculate the losses on said stock for all amounts loaned to the Company from the sale of said stock. On June 30, 2018, Mississippi Gaming Corporation issued a secured promissory note, due one year from the date of issue to the Chairman, for an amount up to $200,000 to cover the principal and interest due with respect to this note. On August 21, 2018, Mississippi Gaming Corporation placed a third lien on the Diamondhead Property to secure this obligation for $200,000. | ||||||||||||||
Chairman [Member] | March 2018 and March 2019 [Member] | |||||||||||||||
Accrued interest due | 129,981 | 80,384 | |||||||||||||
Debt instrument, face amount | 398,274 | ||||||||||||||
Repayment of related party debt | 16,250 | ||||||||||||||
Board of Directors [Member] | March 2019 [Member] | |||||||||||||||
Debt instrument, face amount | $ 200,000 | ||||||||||||||
President [Member] | |||||||||||||||
Debt instrument, interest rate, stated percentage | 9.00% | ||||||||||||||
Secured obligation | $ 100,000 | ||||||||||||||
Repayment of related party debt | $ 19,917 | ||||||||||||||
Proceeds from related parties | $ 20,000 | ||||||||||||||
Incurred expenses | 18,000 | ||||||||||||||
Due from officers | 41,162 | ||||||||||||||
President [Member] | Loan One [Member] | |||||||||||||||
Loan amount | $ 25,000 | 25,000 | |||||||||||||
President [Member] | Loan Two [Member] | |||||||||||||||
Loan amount | 15,000 | 15,000 | |||||||||||||
President [Member] | Two Loans [Member] | |||||||||||||||
Credit facilities, maximum amount | 15,000 | ||||||||||||||
President [Member] | Third Lien [Member] | |||||||||||||||
Loan amount | 100,000 | ||||||||||||||
President [Member] | Secured Promissory Note [Member] | |||||||||||||||
Accrued interest due | 20,452 | 14,278 | |||||||||||||
Maximum [Member] | Board of Directors [Member] | |||||||||||||||
Proceeds from related parties | $ 100,000 | ||||||||||||||
Related party transaction, terms and manner of settlement | Interest of 15% per annum on the amount advanced and owing and that the full 15% interest per annum is payable during any calendar year in which all or part of the amount advanced and owing or interest due thereon remains unpaid; (ii) the obligation in the maximum principal amount of $100,000 with interest due thereon be treated as a secured debt of the Company, to be evidenced by a separate note and to be secured with a separate lien to be placed on the Diamondhead Property ("the Third Lien") together with the Chairman's Third Lien, as well as a first lien to be placed on the residential lot owned by the Company; (iii) that the Third Lien on the Diamondhead Property also include the two loans ($25,000 and $15,000) and interest due thereon and credit facilities in the maximum amount of $15,000; and (iv) that the foregoing will be treated as advances to be paid out of any subsequent incoming financing obtained by the Company or any amounts recovered by the Company from a defendant in that collection action brought by the Company in the Circuit Court of Montgomery County, Maryland. | ||||||||||||||
Maximum [Member] | President [Member] | |||||||||||||||
Secured promissory note | $ 100,000 | ||||||||||||||
Level 1 [Member] | |||||||||||||||
Fair value of derivative liability | 0 | ||||||||||||||
Payable During any Calendar Year [Member] | |||||||||||||||
Debt instrument, interest rate, stated percentage | 11.00% | ||||||||||||||
Seven Lenders [Member] | |||||||||||||||
Cash received advances | $ 47,500 | ||||||||||||||
Three Current Directors [Member] | |||||||||||||||
Cash received advances | 22,500 | ||||||||||||||
Seven Lenders and Three Current Directors [Member] | |||||||||||||||
Debt matures term | 4 years | ||||||||||||||
Debt instrument, interest rate, stated percentage | 8.00% | 8.00% | |||||||||||||
Accrued interest due | 9,800 | 7,600 | |||||||||||||
Debt instrument term | 4 years | ||||||||||||||
Chairman of the Board of Directors [Member] | |||||||||||||||
Debt matures term | 4 years | ||||||||||||||
Debt instrument, interest rate, stated percentage | 14.00% | 14.00% | |||||||||||||
Increase (decrease) in property and other taxes payable | $ 67,628 | ||||||||||||||
Proceeds from related parties | $ 90,000 | ||||||||||||||
Debt instrument term | 4 years | ||||||||||||||
Chairman of the Board of Directors [Member] | Promissory Note [Member] | |||||||||||||||
Accrued interest due | 46,188 | $ 43,082 | |||||||||||||
Chairman [Member] | |||||||||||||||
Secured obligation | 100,000 | ||||||||||||||
Chairman [Member] | Promissory Note [Member] | |||||||||||||||
Secured obligation | $ 200,000 | ||||||||||||||
Chairman [Member] | Maximum [Member] | |||||||||||||||
Secured promissory note | 100,000 | ||||||||||||||
Chairman [Member] | Maximum [Member] | Promissory Note [Member] | |||||||||||||||
Secured promissory note | $ 200,000 | ||||||||||||||
Mississippi Property [Member] | |||||||||||||||
Area of land, owned | a | 400 | ||||||||||||||
Diamondhead Property [Member] | |||||||||||||||
Secured promissory note | 400,000 | ||||||||||||||
Diamondhead Property [Member] | Chairman of Board [Member] | |||||||||||||||
Secured promissory note | (300,000) | ||||||||||||||
Diamondhead Property [Member] | President [Member] | |||||||||||||||
Secured promissory note | $ (100,000) |
Long-Term Notes Payable Due O_2
Long-Term Notes Payable Due Others (Details Narrative) - USD ($) | 1 Months Ended | |
Oct. 31, 2017 | Sep. 26, 2014 | |
Debt instrument, interest rate, stated percentage | 4.00% | |
Four Year Note Issued In Settlement [Member] | ||
Debt instrument term | 4 years | |
Legal fees paid in settlement | $ 50,000 | |
Debt instrument, interest rate, stated percentage | 0.00% | |
Convertible Promissory Note [Member] | ||
Debt instrument, face amount | $ 150,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Sep. 26, 2014 | |
Debt instrument, interest rate, stated percentage | 4.00% | |||
Monthly base rent | $ 4,534 | |||
Base rent expense | 13,602 | $ 13,602 | ||
Associated rental costs | 6,088 | 5,042 | ||
Rent expense associated with lease | 19,690 | 18,644 | ||
Payments associated with base rents | ||||
Current And Former Directors [Member] | ||||
Accrued directors fees | 591,250 | $ 568,750 | ||
President [Member] | ||||
Accrued payroll due officers | $ 2,541,996 | |||
Debt instrument, interest rate, stated percentage | 9.00% | |||
Accrued rent | $ 341,470 | 321,780 | ||
Vice President and Current Chairman of Board of Directors [Member] | ||||
Accrued payroll due officers | 121,140 | |||
Management [Member] | ||||
Interest expense | 57,990 | $ 51,333 | ||
Accrued interest | 1,152,429 | $ 1,094,439 | ||
Directors [Member] | ||||
Directors fees | $ 15,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Sep. 26, 2014 | Mar. 31, 2020 | Dec. 31, 2019 | Aug. 21, 2018 | Dec. 16, 2016 | Dec. 31, 2014 | Mar. 31, 2014 |
Accrued current delinquent filings | $ 334,016 | $ 263,115 | |||||
Employee Stock Ownership Plan [Member] | |||||||
Accrued current delinquent filings | $ 158,500 | $ 140,100 | |||||
Notes Payable Principal Due [Member] | |||||||
Debt instrument, face amount | $ 137,500 | ||||||
Second Lien [Member] | |||||||
Amount owed | $ 250,000 | ||||||
Third Lien [Member] | Diamondhead Property [Member] | |||||||
Amount owed | $ 400,000 | ||||||
Casinos Austria Maritime Corporation [Member] | Management Agreement [Member] | |||||||
Commitment description | On June 19, 1993, two subsidiaries of the Company, Casino World Inc. and Mississippi Gaming Corporation, entered into a Management Agreement with Casinos Austria Maritime Corporation (CAMC). Subject to certain conditions, under the Management Agreement, CAMC would operate, on an exclusive basis, all of the Company's proposed dockside gaming casinos in the State of Mississippi, including any operation fifty percent (50%) or more of which is owned by the Company or its affiliates. Unless terminated earlier pursuant to the provisions of the Agreement, the Agreement terminates five years from the first day of actual Mississippi gaming operations and provides for the payment of an annual operational term management fee of 1.2% of all gross gaming revenues between zero and $100,000,000; plus 0.75% of gross gaming revenue between $100,000,000 and $140,000,000; plus 0.5% of gross gaming revenue above $140,000,000; plus two percent of the net gaming revenue between zero and $25,000,000; plus three percent of the net gaming revenue above twenty-five million dollars $25,000,000. The Company believes this Agreement is no longer in effect. However, there can be no assurance that CAMC will not attempt to maintain otherwise which would lead to litigation. | ||||||
Collateralized Convertible Senior Debentures [Member] | Investors Lien [Member] | Mississippi Property [Member] | |||||||
Secure principal and interest amount due | $ 1,850,000 | ||||||
Collateralized Convertible Senior Debentures [Member] | Executives Lien [Member] | Mississippi Property [Member] | |||||||
Amount owed | $ 2,000,000 | ||||||
Collateralized Convertible Senior Debentures [Member] | Tranche 1 [Member] | Investors Lien [Member] | |||||||
Debt instrument, face amount | $ 1,000,000 | ||||||
Collateralized Convertible Senior Debentures [Member] | Tranche 2 [Member] | Investors Lien [Member] | |||||||
Debt instrument, face amount | $ 850,000 |
Pending and Threatened Litiga_2
Pending and Threatened Litigation (Details Narrative) - USD ($) | Dec. 04, 2020 | Dec. 12, 2019 | Feb. 28, 2019 | Nov. 28, 2018 | Nov. 09, 2018 | Jun. 09, 2017 | Nov. 30, 2016 | Oct. 25, 2016 | Mar. 31, 2020 | Dec. 31, 2008 | Sep. 26, 2014 |
Debt instrument, interest rate, stated percentage | 4.00% | ||||||||||
Debt instrument maturity date | Nov. 1, 2012 | ||||||||||
Federal discount, Description | Post-judgment interest was awarded in accordance with the legal rate in Delaware (5% plus the federal discount rate). The principal and interest pertaining to the settlement above has been accrued through March 31, 2020. | ||||||||||
Promissory Note [Member] | |||||||||||
Debt instrument, interest rate, stated percentage | 12.50% | ||||||||||
Debt instrument maturity date | Jun. 9, 2019 | ||||||||||
Seven Debenture Holders US District Court Case [Member] | |||||||||||
Loss contingency, damages sought, value | $ 100,000 | $ 1,400,000 | |||||||||
Settlement Agreement [Member] | Mississippi Gaming Corporation [Member] | |||||||||||
Debt instrument, interest rate description | i) in the event Mississippi Gaming Corporation (“MGC”) entered into a contract for the sale of the Diamondhead Property on or before December 31, 2019, the Plaintiffs would be paid the principal due under the debentures and interest stated in the debentures of four percent (4%) per annum through the payment date; ii) in the event MGC entered into a contract for the sale of the Property on or before June 30, 2020, the Plaintiffs would be paid the principal due under the debentures, interest of four percent (4%) per annum through December 31, 2019 and, beginning January 1, 2020, interest of five percent (5%) per annum through the payment date; iii) in the event MGC has not entered into a contract for the sale of the Property on or before June 30, 2020, but has done so on or before December 31, 2021, the Plaintiffs would be paid the principal due under the debentures, interest of four percent (4% ) per annum through December 31, 2019 and, beginning January 1, 2020, interest of six percent (6%) per annum through the payment date; and iv) if MGC has not entered into a contract for the sale of the Property on or before December 31, 2021, the Plaintiffs will be entitled to a Judgment for the principal due under the debentures, interest of four percent (4%) per annum through December 31, 2019 and, beginning January 1, 2020, interest of six percent (6%) per annum through the date of Judgment | ||||||||||
Attorneys fees | $ 160,000 | ||||||||||
Court of Special Appeals [Member] | |||||||||||
Settlement amount | $ 36,000 | ||||||||||
Sussman [Member] | |||||||||||
Loss contingency, damages sought, value | $ 50,000 | ||||||||||
Debt instrument maturity date | Jun. 30, 2012 | ||||||||||
Sussman [Member] | Subsequent Event [Member] | Settled Litigation [Member] | |||||||||||
Loss contingency, damages sought, value | $ 88,151 | ||||||||||
Sussman [Member] | Promissory Note [Member] | November 10, 2010 [Member] | |||||||||||
Debt instrument, face amount | $ 50,000 | ||||||||||
Debt instrument, interest rate, stated percentage | 9.00% | ||||||||||
Debt instrument maturity date | Nov. 10, 2012 | ||||||||||
Skaff and Towner [Member] | Promissory Note [Member] | November 29, 2010 [Member] | |||||||||||
Debt instrument, face amount | $ 37,500 | ||||||||||
Debt instrument, interest rate, stated percentage | 9.00% | ||||||||||
Debt instrument maturity date | Nov. 29, 2012 | ||||||||||
Skaff and Towner [Member] | Promissory Note [Member] | June 21, 2011 [Member] | |||||||||||
Debt instrument, face amount | $ 25,000 | ||||||||||
Debt instrument, interest rate, stated percentage | 9.00% | ||||||||||
Debt instrument maturity date | Jun. 21, 2013 | ||||||||||
Towner [Member] | Subsequent Event [Member] | Settled Litigation [Member] | |||||||||||
Loss contingency, damages sought, value | 44,127 | ||||||||||
Towner [Member] | Promissory Note [Member] | November 29, 2010 [Member] | |||||||||||
Debt instrument, face amount | $ 25,000 | ||||||||||
Debt instrument, interest rate, stated percentage | 9.00% | ||||||||||
Debt instrument maturity date | Nov. 29, 2012 | ||||||||||
Skaff [Member] | Subsequent Event [Member] | Settled Litigation [Member] | |||||||||||
Loss contingency, damages sought, value | $ 109,978 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | Nov. 09, 2020$ / sharesshares | Nov. 06, 2020shares | Jun. 30, 2021USD ($)shares | May 31, 2021USD ($)a | Apr. 30, 2021USD ($)shares | May 31, 2020USD ($)a | Feb. 24, 2021USD ($) | Jan. 31, 2021USD ($) | Mar. 31, 2020a |
Area of land | a | 400 | ||||||||
Subsequent Event [Member] | |||||||||
Options to purchase | shares | 1,290,000 | ||||||||
Share price per shares | $ / shares | $ 0.46 | ||||||||
Options expiration date | Dec. 31, 2023 | ||||||||
Subsequent Event [Member] | Unrelated Third Party [Member] | |||||||||
Non-interest-bearing note payable | $ 50,000 | ||||||||
Subsequent Event [Member] | Diamondhead Property [Member] | Secured Promissory Note [Member] | |||||||||
Payments of secured debt | 100,000 | $ 150,000 | |||||||
Subsequent Event [Member] | Fourth Lien [Member] | Diamondhead Property [Member] | |||||||||
Amount owed | $ 2,000,000 | ||||||||
Subsequent Event [Member] | Fifth Lien [Member] | Diamondhead Property [Member] | |||||||||
Amount owed | $ 658,750 | ||||||||
Subsequent Event [Member] | Twelfth and Thirteenth Lien [Member] | Diamondhead Property [Member] | |||||||||
Non-interest-bearing note payable | $ 50,000 | ||||||||
Subsequent Event [Member] | Sixteenth Lien [Member] | Diamondhead Property [Member] | |||||||||
Non-interest-bearing note payable | $ 50,000 | ||||||||
Number of shares issued | shares | 100,000 | ||||||||
Subsequent Event [Member] | Martin Blount [Member] | |||||||||
Options to purchase | shares | 200,000 | ||||||||
Subsequent Event [Member] | Daniel Burstyn [Member] | |||||||||
Options to purchase | shares | 40,000 | ||||||||
Subsequent Event [Member] | Robert Crow [Member] | |||||||||
Options to purchase | shares | 100,000 | ||||||||
Subsequent Event [Member] | Benjamin Harrell [Member] | |||||||||
Options to purchase | shares | 360,000 | ||||||||
Subsequent Event [Member] | Gregory Harrison [Member] | |||||||||
Options to purchase | shares | 450,000 | ||||||||
Subsequent Event [Member] | Deborah Vitale [Member] | |||||||||
Options to purchase | shares | 140,000 | ||||||||
Subsequent Event [Member] | President [Member] | |||||||||
Additional funds advanced | 12,489 | ||||||||
Subsequent Event [Member] | President [Member] | Fourth Lien [Member] | |||||||||
Non-interest-bearing note payable | $ 2,000,000 | ||||||||
Subsequent Event [Member] | Directors [Member] | Fifth Lien [Member] | |||||||||
Non-interest-bearing note payable | $ 658,750 | ||||||||
Subsequent Event [Member] | Lender [Member] | Six Lien [Member] | Diamondhead Property [Member] | |||||||||
Non-interest-bearing note payable | $ 252,500 | ||||||||
Subsequent Event [Member] | Chairman of Board [Member] | Diamondhead Property [Member] | |||||||||
Property taxes payable | 62,610 | 67,076 | |||||||
Related fees to pay the property taxes | $ 1,468 | $ 1,573 | |||||||
Area of land | a | 400 | 400 | |||||||
Subsequent Event [Member] | Common Stock [Member] | |||||||||
Options to purchase | shares | 2,965,000 | ||||||||
Stock option description | On November 6, 2020, the Board of Directors of the Company voted to extend to December 31, 2023, a total of 2,965,000 options to purchase common stock previously awarded to officers, directors and current and former employees of the Company. The options were scheduled to expire on December 31, 2020. | ||||||||
Subsequent Event [Member] | Common Stock [Member] | Twelfth and Thirteenth Lien [Member] | Diamondhead Property [Member] | |||||||||
Number of shares issued | shares | 100,000 | ||||||||
Subsequent Event [Member] | Common Stock [Member] | Lender [Member] | Six Lien [Member] | Diamondhead Property [Member] | |||||||||
Number of shares issued | shares | 252,500 |