Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 26, 2020 | Jun. 28, 2019 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | FULL HOUSE RESORTS INC | ||
Entity Central Index Key | 0000891482 | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-Known Seasoned Issuer | No | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 27,075,962 | ||
Entity Public Float | $ 45.1 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Amendment Flag | false | ||
Document Fiscal Year End | 2019 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | ||
Net revenues | $ 165,432 | $ 163,887 |
Operating costs and expenses | ||
Selling, general and administrative | 56,052 | 54,439 |
Preopening costs | 274 | |
Project development costs | 1,037 | 843 |
Depreciation and amortization | 8,331 | 8,397 |
Loss on sale or disposal of assets, net | 8 | 79 |
Total operating costs and expenses | 159,216 | 156,461 |
Operating income | 6,216 | 7,426 |
Operating income | ||
Interest expense, net of amounts capitalized of $772 and $346 | (10,728) | (10,306) |
Loss on extinguishment of debt | 0 | (2,673) |
Adjustment to fair value of warrants | (1,230) | 1,671 |
Other | (13) | |
Total other (expense) income | (11,958) | (11,321) |
Loss before income taxes | (5,742) | (3,895) |
Income tax expense | 80 | 476 |
Net loss | $ (5,822) | $ (4,371) |
Basic earnings (loss) per share (in dollars per share) | $ (0.22) | $ (0.17) |
Diluted earnings (loss) per share (in dollars per share) | $ (0.22) | $ (0.23) |
Weighted Average Number of Shares Outstanding, Basic | 26,979,829 | 26,012,381 |
Weighted Average Number of Shares Outstanding, Diluted | 26,979,829 | 26,460,902 |
Casino | ||
Revenues | ||
Net revenues | $ 113,390 | $ 114,324 |
Operating costs and expenses | ||
Costs and expenses | 50,673 | 50,074 |
Food and beverage | ||
Revenues | ||
Net revenues | 35,069 | 35,058 |
Operating costs and expenses | ||
Costs and expenses | 33,950 | 33,495 |
Hotel | ||
Revenues | ||
Net revenues | 11,535 | 9,864 |
Operating costs and expenses | ||
Costs and expenses | 5,608 | 5,747 |
Other operations | ||
Revenues | ||
Net revenues | 5,438 | 4,641 |
Operating costs and expenses | ||
Costs and expenses | $ 3,557 | $ 3,113 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | ||
Interest costs capitalized | $ 772 | $ 346 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Current assets | |||
Cash and equivalents | $ 28,851 | $ 20,634 | |
Restricted cash | 1,000 | 0 | |
Accounts receivable, net of allowance of $141 and $98 | 2,206 | 2,035 | |
Inventories | 2,292 | 1,425 | |
Prepaid expenses and other | 3,340 | 2,899 | |
Total current assets | 37,689 | 26,993 | |
Other long-term assets | |||
Property and equipment, net | 121,487 | 122,076 | |
Operating lease right-of-use assets, net | [1] | 19,171 | 0 |
Goodwill | 21,286 | 21,286 | |
Other intangible assets, net | 11,056 | 11,145 | |
Deposits and other | 646 | 772 | |
Total Assets | 211,335 | 182,272 | |
Current liabilities | |||
Accounts payable | 5,216 | 5,917 | |
Accrued payroll and related | 3,044 | 3,668 | |
Other accrued expenses and other | 10,613 | 9,704 | |
Current portion of operating lease obligations(1) | [1] | 2,707 | 0 |
Current portion of finance lease obligation | 448 | 497 | |
Current portion of long-term debt | 1,100 | 1,000 | |
Common stock warrant liability | 2,055 | 825 | |
Total current liabilities | 25,183 | 21,611 | |
Operating lease obligations, net of current portion(1) | [1] | 16,706 | 0 |
Finance lease obligation, net of current portion | 3,829 | ||
Finance lease obligation, net of current portion | 4,324 | ||
Long-term debt, net | 102,923 | 94,194 | |
Deferred income taxes, net | 712 | 632 | |
Other | 5,886 | 166 | |
Total liabilities | 155,239 | 120,927 | |
Commitments and contingencies (Note 8) | |||
Stockholders' equity | |||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 28,345,525 and 28,288,764 shares issued and 27,075,962 and 26,932,169 shares outstanding | 3 | 3 | |
Additional paid-in capital | 64,402 | 63,935 | |
Treasury stock, 1,269,563 and 1,356,595 common shares | (1,548) | (1,654) | |
Accumulated deficit | (6,761) | (939) | |
Total stockholders' equity | 56,096 | 61,345 | |
Total liabilities and stockholders' equity | $ 211,335 | $ 182,272 | |
[1] | On January 1, 2019, the Company adopted Accounting Standards Codification 842 (“ASC 842”), using the modified retrospective transition method under the effective date approach, which impacts the comparability of these line items. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 141 | $ 98 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 28,345,525 | 28,288,764 |
Common stock, shares outstanding (in shares) | 27,075,962 | 26,932,169 |
Treasury stock, common shares (in shares) | 1,269,563 | 1,356,595 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings (Accumulated Deficit) | Total |
Balance at Dec. 31, 2017 | $ 2 | $ 51,868 | $ (1,654) | $ 3,432 | $ 53,648 |
Balance (in shares) at Dec. 31, 2017 | 24,294 | 1,357 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock grants | 104 | 104 | |||
Stock grants (in shares) | 34 | ||||
Equity offering, net | $ 1 | 11,435 | 11,436 | ||
Equity offering, net (in shares) | 3,943 | ||||
Stock-based compensation | 528 | 528 | |||
Stock-based compensation(in shares) | 18 | ||||
Net income (loss) | (4,371) | (4,371) | |||
Balance at Dec. 31, 2018 | $ 3 | 63,935 | $ (1,654) | (939) | 61,345 |
Balance (in shares) at Dec. 31, 2018 | 28,289 | 1,357 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of stock options | 119 | $ 106 | 225 | ||
Exercise of stock options (in shares) | 35 | (87) | |||
Stock grants | 48 | 48 | |||
Stock grants (in shares) | 22 | ||||
Stock-based compensation | 300 | 300 | |||
Net income (loss) | (5,822) | (5,822) | |||
Balance at Dec. 31, 2019 | $ 3 | $ 64,402 | $ (1,548) | $ (6,761) | $ 56,096 |
Balance (in shares) at Dec. 31, 2019 | 28,346 | 1,270 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (5,822) | $ (4,371) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 8,331 | 8,397 |
Amortization of debt issuance and warrant costs | 1,092 | 790 |
Stock-based compensation | 348 | 632 |
Change in fair value of stock warrants | 1,230 | (1,671) |
Change in fair value of interest rate cap | 92 | 146 |
Loss on extinguishment of debt | 0 | 2,673 |
Loss on sale or disposal of assets | 8 | 79 |
Increases and decreases in operating assets and liabilities: | ||
Accounts receivable | (171) | (275) |
Prepaid expenses, inventories and other | (678) | 217 |
Deferred taxes | 80 | 476 |
Deferred revenue | 5,985 | 0 |
Accounts payable and accrued expenses | (26) | 2,731 |
Net cash provided by operating activities | 10,469 | 9,824 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (8,088) | (17,051) |
Other | (582) | (379) |
Net cash used in investing activities | (8,670) | (17,430) |
Cash flows from financing activities: | ||
Repayment of First and Second Lien Term Loans | 0 | (96,063) |
Prepayment premium of Second Lien Term Loan | 0 | (1,100) |
Proceeds from Senior Secured Notes borrowings | 10,000 | 100,000 |
Payment of debt discount and issuance costs | (1,188) | (4,105) |
Payment of Interest Rate Cap premium | 0 | (238) |
Repayment of Senior Secured Notes | (1,075) | (1,000) |
Repayment of finance lease obligation | (544) | |
Repayment of finance lease obligation | (460) | |
Proceeds from equity offering | 0 | 11,435 |
Proceeds from exercise of stock options | 119 | 0 |
Other | 106 | (139) |
Net cash provided by financing activities | 7,418 | 8,330 |
Net increase in cash, cash equivalents and restricted cash | 9,217 | 724 |
Cash, cash equivalents and restricted cash, beginning of period | 20,634 | 19,910 |
Cash, cash equivalents and restricted cash, end of period | 29,851 | 20,634 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest, net of amounts capitalized | 9,316 | 9,368 |
NON-CASH INVESTING ACTIVITIES: | ||
Accounts payable related capital expenditures | $ 515 | $ 328 |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | 1. ORGANIZATION Formed as a Delaware corporation in 1987, Full House Resorts, Inc. owns, leases, operates, develops, manages, and/or invests in casinos and related hospitality and entertainment facilities. References in this document to “Full House,” the “Company,” “we,” “our,” or “us” refer to Full House Resorts, Inc. and its subsidiaries, except where stated or the context otherwise indicates. The Company currently operates five casinos; four are part of real estate that we own or lease and one is located within a hotel owned by a third party. The following table identifies the properties along with their dates of acquisition and locations: Property Acquisition Location Silver Slipper Casino and Hotel 2012 Hancock County, MS Bronco Billy’s Casino and Hotel 2016 Cripple Creek, CO Rising Star Casino Resort 2011 Rising Sun, IN Stockman’s Casino 2007 Fallon, NV Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) 2011 Incline Village, NV The Company manages its casinos based on geographic regions within the United States. See Note 13 for further information. |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation and Accounting. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Except when otherwise required by accounting principles generally accepted in the United States of America (“GAAP”) and disclosed herein, the Company measures all of its assets and liabilities on the historical cost basis of accounting. Use of Estimates. The consolidated financial statements have been prepared in conformity with GAAP. These principles require the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. Liquidity and Going Concern. The consolidated financial statements have been prepared on the going concern basis of accounting, assuming the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company’s casinos are its primary sources of income and operating cash flows and they are relied upon to remain in compliance with debt covenants and meet the Company’s obligations when due. As described in Note 6, the Senior Secured Notes agreement requires the Company to maintain a total leverage ratio covenant, which measures Consolidated EBITDA (as defined in the indenture) against outstanding debt. As detailed in in Note 14, in March 2020, the Company temporarily suspended operations at its casinos and hotels pursuant to orders from governmental authorities as a precautionary measure against the ongoing spread of COVID-19, a highly contagious coronavirus that was declared a pandemic by the World Health Organization. As the COVID-19 situation is dynamic, the Company does not currently know with certainty when it will be permitted to reopen its casinos and hotels. Management believes it has sufficient resources to fund its currently-reduced operations, consisting principally of preservation of assets and a core staff necessary to plan for reopening, for several months. However, management does not control and is not qualified to predict the length of the closure of its casinos and hotels due to the pandemic. It is also possible that some of the Company’s operations may be allowed to open sooner than others, depending on the regional impact of the pandemic. As described in Note 2 to this Form 10-K for the period ended December 31, 2019, a significant period of closure or significant declines in business volumes upon reopening would negatively impact our ability to remain in compliance with our debt covenants. In the event that the Company would fail to meet its debt covenants in the next twelve months, the Company would either seek covenant waivers or attempt to amend its covenants, though there is no certainty that the Company would be successful in such efforts. Additionally, the Company could seek additional liquidity through the issuance of new debt or equity, or through the sale of certain assets. Successful completion of such items, if needed, would be dependent in part on factors outside of the Company’s control. ASC 205-40, Going Concern, calls for management to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within twelve months after the date that the financial statements are issued. Because of the length of this look-forward period and the substantial items that are outside of its control, and despite its intent and best efforts to overcome the challenges in the current environment, management concluded that there is substantial doubt as to the Company’s ability to continue as a going concern. The Company is attempting to mitigate the impacts of the coronavirus on the Company through the plans described above. Fair Value and the Fair Value Input Hierarchy. Fair value measurements affect the Company’s accounting for net assets acquired in acquisition transactions and certain financial assets and liabilities, such as its common stock warrant liability and interest rate cap. Fair value measurements are also used in its periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets. Fair value is defined as the expected price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. GAAP categorizes the inputs used for fair value into a three-level hierarchy: · Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; · Level 2: Comparable inputs, other than quoted prices, that are observable for similar assets or liabilities in less active markets; and · Level 3: Unobservable inputs, which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. The Company utilizes Level 2 inputs when measuring the fair value of its interest rate cap. In order to estimate the fair value of this derivative instrument, the Company obtains valuation reports from the third-party broker that issued the interest rate cap. The report contemplates fair value by using inputs including market-observable data such as interest rate curves, volatilities, and information derived from or corroborated by that market-observable data (see Notes 6 and 12). The Company utilizes Level 3 inputs when measuring the fair value of net assets acquired in business combination transactions, subsequent assessments for impairment, and most financial instruments, including but not limited to the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Notes 6 and 12). Cash Equivalents and Restricted Cash. Cash equivalents include cash involved in operations and cash in excess of daily requirements that is invested in highly liquid, short-term investments with initial maturities of three months or less when purchased. Restricted cash balances are funds received from certain sports wagering agreements that have not commenced and are contractually required to be separated from the Company’s operating cash. Upon receipt of authorization from gaming authorities in Colorado, these restricted cash balances will no longer have restrictions, and accordingly will be reclassified on the balance sheet as cash and equivalents. Cash, cash equivalents and restricted cash consisted of the following: (In Thousands) December 31, 2019 2018 Cash and equivalents $ 28,851 $ 20,634 Restricted cash 1,000 — $ 29,851 $ 20,634 Accounts Receivable. Accounts receivable consist primarily of casino, hotel and other receivables, are typically non-interest bearing, and are carried net of an appropriate collection allowance to approximate fair value. Allowances for doubtful accounts are estimated based on specific review of customer accounts including the customers’ willingness and ability to pay and nature of collateral, if any, as well as historical collection experience and current economic and business conditions. Accounts are written off when management deems the account to be uncollectible and recoveries of accounts previously written off are recorded when received. Inventories. Inventories consist primarily of food, beverage and retail items, and are stated at the lower of cost or net realizable value. Costs are determined using the first-in, first-out and the weighted average methods. Property and Equipment. Property and equipment are stated at cost and are capitalized and depreciated, while normal repairs and maintenance are expensed in the period incurred. A significant amount of the Company’s property and equipment was acquired through business combinations, and therefore, are recognized at fair value measured at the acquisition date. Gains or losses on dispositions of property and equipment are included in operating expenses, effectively as adjustments to depreciation estimates. Certain events or changes in circumstances may indicate that the recoverability of the carrying amount of property, plant and equipment should be assessed, including, among others, a significant decrease in market value, a significant change in the business climate in a particular market, or a current period operating or cash flow loss combined with historical losses or projected future losses. When such events or changes in circumstances are present, the Company estimates the future cash flows expected to result from the use of the asset (or asset group) and its eventual disposition. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, then the Company would recognize an impairment loss. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets or the term of the lease, whichever is appropriate under the circumstances. The Company determines the estimated useful lives based on our experience with similar assets, estimated usage of the asset, and industry practice. Whenever events or circumstances occur, which change the estimated useful life of an asset, the Company accounts for the change prospectively. Depreciation and amortization is provided over the following estimated useful lives: Estimated Class of Assets Useful Lives Land improvements 15 to 18 years Buildings and improvements 3 to 44 years Furniture, fixtures and equipment 2 to 10 years Leases. The Company determines if a contract is, or contains, a lease at inception or modification of the agreement. A contract is, or contains, a lease if there are identified assets and the right to control the use of an identified asset is conveyed for a period of time in exchange for consideration. Control over the use of the identified asset means that the lessee has both the right to obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset. For leases with terms greater than a year, the Company records right-of-use (“ROU”) assets and lease liabilities on the balance sheet, as measured on a discounted basis. For finance leases, the Company recognizes interest expense associated with the lease liability and depreciation expense associated with the ROU asset; for operating leases, the Company recognizes straight-line rent expense. The Company will not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, will be disclosed as a component of lease expenses when applicable. Additionally, the Company accounts for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component by asset class for gaming-related equipment; as a result, the Company will not allocate contract consideration to the separate lease and non-lease components based on their relative standalone prices. Finance and operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate as estimated by third-party valuation specialists in determining the present value of future payments. The expected lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term. Goodwill and Indefinite-lived Intangible Assets. Goodwill represents the excess of the purchase price of Bronco Billy’s Casino and Hotel, Silver Slipper Casino and Hotel, Rising Star Casino Resort and Stockman’s Casino over the estimated fair value of their net tangible and other intangible assets on the acquisition date, net of subsequent impairment charges. The Company’s other indefinite-lived intangible assets primarily include certain license rights to conduct gaming in certain jurisdictions and trade names. Goodwill and other indefinite-lived intangible assets are not amortized, but are periodically tested for impairment. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value. The evaluation of goodwill and other indefinite-lived intangible assets requires the use of estimates about future operating results, valuation multiples and discount rates to determine the estimated fair value. Changes in the assumptions can materially affect these estimates. Thus, to the extent that gaming volumes deteriorate in the near future, discount rates increase significantly, or reporting units do not meet projected performance, the Company could have impairments to record in the future and such impairments could be material. These tests for impairment are performed annually during the fourth quarter or when a triggering event occurs. Finite-lived Intangible Assets. The Company’s finite-lived intangible assets includes customer loyalty programs, land lease acquisition costs and water rights. Finite-lived intangible assets are amortized over the shorter of their contractual or economic lives. The Company periodically evaluates the remaining useful lives of these intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization and the possible need for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, then the Company would recognize an impairment loss. Debt Issuance Costs and Debt Discounts. Debt issuance costs and debt discounts incurred in connection with the issuance of debt have been included as a component of the carrying amount of debt, and are amortized over the contractual term of the debt to interest expense, using the effective interest method. When its existing debt agreements are determined to have been modified, the Company amortizes such costs to interest expense using the effective interest method over the terms of the modified debt agreement. Revenue Recognition of Accrued Club Points and Deferred Revenues: Accrued Club Points: Operating Revenues and Related Costs and Expenses. The Company’s revenues consist primarily of casino gaming, food and beverage, hotel, and other revenues (such as entertainment). The majority of its revenues are derived from casino gaming, principally slot machines. Gaming revenue is the difference between gaming wins and losses, not the total amount wagered. The Company accounts for its gaming transactions on a portfolio basis, as such wagers have similar characteristics and it would not be practical to view each wager on an individual basis. The Company sometimes provides discretionary complimentary goods and services (“discretionary comps”). For these types of transactions, the Company allocates revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Many of the Company’s customers choose to earn points under its customer loyalty programs. As points are accrued, the Company defers a portion of its gaming revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points, primarily for “free casino play/cash back,” complimentary dining, or hotel stays. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Deferred Revenues: Market Access Fees from Sports Wagering Agreements. These liabilities were created in the third quarter of 2019 when the Company entered into several agreements with various unaffiliated companies allowing for online sports wagering within Indiana and Colorado, as well as on-site sports wagering at Rising Star Casino Resort and at Bronco Billy’s Casino and Hotel (the “Sports Agreements”). As part of these longer-term Sports Agreements, the Company received one-time market access fees totaling $6 million in cash, which were recorded as a long-term liability in the same amount and will be recognized as revenue ratably over the initial term length of 10 years, beginning with the commencement of operations. The current and noncurrent portions of the deferred revenues balance totaling $5.99 million for December 31, 2019 is included with “other accrued expenses” and “other” on the consolidated balance sheets, respectively. Of the Company’s Sports Agreements, on-site sports wagering commenced in Indiana in the fourth quarter of 2019, as did one of the Company’s three contracted mobile sports operators in Indiana. The other two contracted parties in Indiana are expected to begin operations in mid-2020. In Colorado, gaming regulators are currently drafting the rules that will govern sports wagering in the state. The Company believes that sports wagering could also begin at its Bronco Billy’s Casino and Hotel – as well as throughout the state via mobile sports wagering – in mid-2020. Advertising Costs. Costs for advertising are expensed as incurred, or the first time the advertising takes place, and are included in selling, general and administrative expenses. Total advertising costs were $4.2 million and $3.8 million for the years ended December 31, 2019 and 2018, respectively. Customer Loyalty Programs. We have separate customer loyalty programs at each of our properties – the Silver Slipper Casino Players Club, Bronco Billy’s Mile High Rewards Club, Rising Star Rewards Club™, Grand Lodge Players Advantage Club® and Stockman’s Winner’s Club. Under these programs, customers earn points based on their volume of wagering that may be redeemed for various benefits, such as free play, cash back, complimentary dining, or hotel stays, among others, depending on each property’s specific offers. Unredeemed points are forfeited if the customer becomes and remains inactive for a specified period of time. Liabilities based on the standalone retail value of such benefits totaling $1.4 million each for December 31, 2019 and 2018, respectively, and these amounts are included in “other accrued expenses” on the consolidated balance sheets. Project Development and Acquisition Costs . Project development and acquisition costs consist of amounts expended on the pursuit of new business opportunities and acquisitions, which are expensed as incurred. During 2019, these costs were associated with our pursuit to develop and operate American Place, a casino and entertainment destination in Waukegan, Illinois. During 2018, these costs were associated primarily with our pursuit of a racetrack casino in New Mexico, the potential relocation of gaming positions to Terre Haute, Indiana, and acquisition opportunities. Stock-based Compensation. Stock-based compensation costs are measured at the grant date, based on the estimated fair value of the award using the Black-Scholes option pricing model for stock options, and based on the closing share price of the Company’s stock on the grant date for other stock-based awards. The cost is recognized as an expense on a straight-line basis over the employee’s requisite service period (the vesting period of the award) net of forfeitures, which are recognized as they occur. Legal Defense Costs. We do not accrue for estimated future legal and related defense costs, if any, to be incurred in connection with outstanding or threatened litigation and other disputed matters. Instead, we record such costs as period costs when the related services are rendered. Income Taxes. We classify deferred tax liabilities and assets, along with any related valuation allowance, as non-current in a classified statement of financial position. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are provided against deferred tax assets when it is deemed more likely than not that some portion or all of the deferred tax asset will not be realized within a reasonable time period. Our income tax returns are subject to examination by the Internal Revenue Service (“IRS”) and other tax authorities. Positions taken in tax returns are sometimes subject to uncertainty in the tax laws and may not ultimately be accepted by the IRS or other tax authorities. We assess our tax positions using a two-step process. A tax position is recognized if it meets a “more likely than not” threshold, and is measured at the largest amount of benefit that is greater than 50 percent likely of being realized. Additionally, we recognize accrued interest and penalties, if any, related to unrecognized tax benefits in income tax expense. Earnings (loss) per share. Earnings (loss) per share is computed by dividing net income (loss) applicable to common stock by the weighted-average number of common shares outstanding during the period. Diluted earnings per share reflects the additional dilution for all potentially-dilutive securities, including stock options and warrants, using the treasury stock method. (In Thousands) Year Ended December 31, 2019 2018 Numerator: Net loss - basic $ (5,822) $ (4,371) Adjustment for assumed conversion of warrants — (1,671) Net loss - diluted $ (5,822) $ (6,042) Denominator: Weighted-average common and common share equivalents - basic 26,980 26,012 Potential dilution from assumed conversion of warrants — 449 Weighted-average common and common share equivalents - diluted 26,980 26,461 Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share 3,851 2,576 Reclassifications. Certain reclassifications have been made to 2018 amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported results of operations or financial position. Recently Issued Accounting Pronouncements: Pronouncement Implemented in 2019. In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASC 842, which replaces the existing guidance for leases and requires expanded disclosures about leasing activities. ASC 842 requires a dual approach for lessee accounting under which a lessee would classify and account for leases as either finance leases or operating leases, both of which result in the lessee recognizing a right-of-use (“ROU”) asset and a corresponding lease liability on the balance sheet, as measured on a discounted basis for leases with terms greater than a year. For finance leases, the lessee will recognize interest expense associated with the lease liability and depreciation expense associated with the ROU asset; for operating leases, the lessee will recognize straight-line rent expense. For publicly-traded companies, ASC 842 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Under the previous guidance for leases through December 31, 2018, rental payments for certain property and equipment used in the Company’s operations under long-term operating leases were recognized as rent expense with scheduled rent increases recognized on a straight-line basis over the initial lease term, without recording a lease asset and obligation. Rental payments for other property and equipment held under capital leases were recognized as a reduction of a finance lease obligation and interest expense. The fixed assets acquired pursuant to finance leases were included in property and equipment and amortized over the term of the lease. Under the modified retrospective transition method, the Company elected to use the effective date approach with the period of adoption on January 1, 2019 as the date of initial application, and therefore, has elected to not recast comparative period financial information. In addition, the Company has elected the package of practical expedients permitted under the transition guidance to allow it to carry forward historical lease classifications, which includes not needing to reassess: (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) measurement of initial direct costs for any existing leases. The Company has also elected the practical expedient for short-term lease measurement and recognition, under which the Company will not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, will be disclosed as a component of lease expenses when applicable. Additionally, the Company has elected the practical expedient to account for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component by asset class for gaming-related equipment; as a result, the Company will not allocate contract consideration to the separate lease and non-lease components based on their relative standalone prices. Pronouncements Not Yet Adopted. Management believes that there are no other recently issued accounting standards not yet effective that are likely to have a material impact on our financial statements. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | 3. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following: (In Thousands) December 31, 2019 2018 Land and improvements $ 16,144 $ 16,002 Buildings and improvements 114,672 114,001 Furniture and equipment 47,886 45,463 Construction in progress 10,856 6,864 189,558 182,330 Less: Accumulated depreciation (68,071) (60,254) $ 121,487 $ 122,076 Property and equipment included assets under finance leases related to our hotel at Rising Star Casino Resort (Note 7) as follows: (In Thousands) December 31, 2019 2018 Leased land and improvements $ 215 $ 215 Leased buildings and improvements 5,787 5,787 Leased furniture and equipment 1,724 1,724 7,726 7,726 Less: Accumulated amortization (2,689) (2,531) $ 5,037 $ 5,195 |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLES | 4. GOODWILL AND OTHER INTANGIBLES Goodwill: The following tables set forth changes in the carrying value of goodwill by segment: (In Thousands) December 31, 2019 Gross Balance at Carrying Accumulated End of the Value Additions Impairments Year Silver Slipper Casino and Hotel $ 14,671 $ — $ — $ 14,671 Rising Star Casino Resort 1,647 — (1,647) — Bronco Billy's Casino and Hotel 4,806 — — 4,806 Northern Nevada Casinos 5,809 — (4,000) 1,809 $ 26,933 $ — $ (5,647) $ 21,286 (In Thousands) December 31, 2018 Gross Balance at Carrying Accumulated End of the Value Additions Impairments Year Silver Slipper Casino and Hotel $ 14,671 $ — $ — $ 14,671 Rising Star Casino Resort 1,647 — (1,647) — Bronco Billy's Casino and Hotel 4,806 — — 4,806 Northern Nevada Casinos 5,809 — (4,000) 1,809 $ 26,933 $ — $ (5,647) $ 21,286 Other Intangible Assets: The following tables set forth changes in the carrying value of intangible assets other than goodwill: (In Thousands) December 31, 2019 Estimated Gross Accumulated Other Life Carrying Accumulated Impairments, Intangible (Years) Value Amortization Net Assets, Net Customer Loyalty Programs 3 $ 7,600 $ (7,600) $ — $ — Land Lease and Water Rights 46 1,420 (226) — 1,194 Casino Lease Option 3 190 (87) — 103 Gaming Licenses Indefinite 18,046 — (10,203) 7,843 Trade Names Indefinite 1,800 — — 1,800 Trademarks Indefinite 116 — — 116 $ 29,172 $ (7,913) $ (10,203) $ 11,056 (In Thousands) December 31, 2018 Estimated Gross Accumulated Other Life Carrying Accumulated Impairments, Intangible (Years) Value Amortization Net Assets, Net Customer Loyalty Programs 3 $ 7,600 $ (7,600) $ — $ — Land Lease and Water Rights 46 1,420 (195) — 1,225 Casino Lease Option 3 190 (24) — 166 Gaming Licenses Indefinite 18,046 — (10,203) 7,843 Trade Names Indefinite 1,800 — — 1,800 Trademarks Indefinite 111 — — 111 $ 29,167 $ (7,819) $ (10,203) $ 11,145 There were no impairments to goodwill or other intangible assets for the years ended December 31, 2019 and 2018. Customer Loyalty Programs. Customer loyalty programs represent the value of repeat business associated with our loyalty programs. The values of $5.9 million for Silver Slipper and $1.7 million for Rising Star’s customer loyalty programs, respectively, were determined using a multi-period excess earning method of the income approach, which examines the economic returns contributed by the identified tangible and intangible assets of a company, and then isolates the excess return, which is attributable to the asset being valued, based on cash flows attributable to the customer loyalty program. The values of the customer loyalty programs for Rising Star and Silver Slipper have been fully amortized in prior years, but they comprise the majority of accumulated amortization totaling $7.9 million as of December 31, 2019 and $7.8 million as of December 31, 2018. Land Lease Acquisition Costs and Water Rights. Silver Slipper recognized intangible assets related to its lease agreement with Cure Land Company, LLC (see Note 7). The lease was valued at $970,000 and represents the excess fair value of the land over the estimated net present value of the land lease payments, and the water rights value of $450,000 represents the fair value of the water rights based upon market rates in Hancock County, Mississippi. Casino Lease Option. Casino lease option represents total amounts paid in order to extend the lease option for the Imperial Casino, now known as the Christmas Casino at Bronco Billy’s. Although the Company has an option to buy out the lease prior to expiration of the initial lease term or as extended, the options paid cannot be applied to the purchase price. Therefore, the total options paid will be amortized according to the initial lease term, which commenced in August 2018 (see Note 7). Gaming Licenses. Gaming licenses primarily represent the value of the license to conduct gaming in certain jurisdictions, which are subject to highly extensive regulatory oversight and, in some cases, a limitation on the number of licenses available for issuance. The values of gaming licenses were primarily estimated using a multi-period excess earning method of the income approach, which examines the economic returns contributed by the identified tangible and intangible assets of a company, and then isolates the excess return, which is attributable to the asset being valued, based on cash flows attributable to the gaming license. Trade Names. Trade names represents the value of the Bronco Billy’s casino name, which has existed for approximately 26 years and provides brand recognition. The value was estimated using a relief-from-royalty method of the income approach based upon comparable trade name royalty agreements. Current and Future Amortization. Intangible asset amortization expense was approximately $94,000 and $56,000 for the years ended December 31, 2019 and 2018, respectively. Future amortization expense for intangible assets is as follows: (In Thousands) For Years ending December 31, Amortization Expense 2020 $ 94 2021 70 2022 31 2023 31 2024 31 Thereafter 1,039 $ 1,296 |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Liabilities, Current [Abstract] | |
ACCRUED LIABILITIES | 5. ACCRUED LIABILITIES Other accrued expenses consisted of the following: (In Thousands) December 31, 2019 2018 Player club points and progressive jackpots $ 3,281 $ 3,389 Real estate and personal property taxes 1,730 1,614 Gaming and other taxes 2,082 2,028 Other gaming-related accruals 1,299 1,112 Accrued rent 422 604 Current portion of deferred revenue 100 — Other 1,699 957 $ 10,613 $ 9,704 |
LONG-TERM DEBT AND COMMON STOCK
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | 6. LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY Long-Term Debt Senior Secured Notes . On February 2, 2018, the Company sold $100 million of senior secured notes due 2024 (the “Original Notes”) to qualified institutional buyers. The Notes were issued on the same day at 98% of their face value (a 2% original issue discount). Proceeds from the Notes were used to (i) pay fees and expenses incurred in connection with the debt offering; (ii) refinance the entire amounts outstanding under the First and Second Lien Credit Facilities; (iii) provide ongoing working capital; and (iv) provide funds for capital expenditures and for general corporate purposes. As of February 2, 2018, immediately prior to the issuance of the Notes, we had approximately $41 million outstanding under the First Lien Credit Facility and $55 million outstanding under the Second Lien Credit Facility, which were extinguished at a loss of $2.7 million, reflecting the call premiums on such debt and the write-off of related unamortized debt issuance costs. On May 10, 2019, the Company entered into a Notes Purchase Agreement under which it agreed to sell an additional $10 million in aggregate principal amount of its senior secured notes due 2024 (the “Incremental Notes”) to qualified institutional buyers. The Company has used or expects to use the proceeds from the Incremental Notes to (i) provide additional liquidity for the construction of the Phase One parking garage at Bronco Billy’s Casino and Hotel and other capital expenditures; (ii) pay fees and expenses incurred in connection with the Incremental Notes offering; and (iii) provide funds for general corporate purposes. The Incremental Notes were issued on the same day at a price of 99.01% of their face value (a 0.99% original issue discount) pursuant to the indenture (as amended and supplemented, the “Indenture”), dated as of February 2, 2018. The Indenture governs the $100 million of Original Notes previously issued by the Company on February 2, 2018. The Incremental Notes have the same maturity date and interest rate as the Original Notes, are part of the same series as the Original Notes, and are treated as a single class together with the Original Notes (collectively, the “Notes”) for all purposes under the Indenture. Also, on May 10, 2019, the Company executed the Second Amendment to the Indenture dated as of May 10, 2019, which (i) increased the principal amount required to be redeemed each quarter from $250,000 to $275,000 in total aggregate of the Notes, beginning June 30, 2019; (ii) permitted liens incurred in connection with the Cripple Creek Expansion Project; and (iii) changed the total leverage ratio as described in the Indenture and below under “Covenants.” The Notes bear interest at the greater of the three-month London Interbank Offered Rate (“LIBOR”) or 1.0%, plus a margin rate of 7.0%. Interest on the Notes is payable quarterly in arrears, on March 31, June 30, September 30 and December 31 of each year until the Notes mature on February 2, 2024. On each interest payment date, the Company is required to make principal payments of $275,000 with a balloon payment for the remaining $103.5 million due upon maturity. The Company may redeem all or a part of the Notes plus the premium as set forth below, plus accrued and applicable unpaid interest: Redemption Periods Percentage Premium On February 2, 2019 to February 1, 2020 2.0 % On February 2, 2020 to February 1, 2021 1.5 % On February 2, 2021 to February 1, 2022 0.5 % On or after February 2, 2022 — % The Notes are collateralized by substantially all of our assets and are guaranteed by all of our material subsidiaries. Prior Credit Facilities. The First Lien Credit Facility was due to mature in May 2019 and included quarterly principal payments as defined and interest based on the greater of the elected LIBOR (as defined) or 1.0%, plus a margin rate of 4.25%. The Second Lien Credit Facility was due to mature in November 2019 with all principal due at maturity, included interest at 13.5% and had a prepayment premium of 2% immediately prior to the refinancing. As discussed above, both the First Lien Credit Facility and the Second Lien Credit Facility were refinanced in February 2018 in their entirety through the issuance of the Original Notes due 2024. Long-term debt, related discounts and issuance costs consisted of the following: (In Thousands) December 31, 2019 2018 Senior Secured Notes $ 107,925 $ 99,000 Less: Unamortized discounts and debt issuance costs (3,902) (3,806) 104,023 95,194 Less: Current portion of long-term debt (1,100) (1,000) $ 102,923 $ 94,194 Maturities of Long-Term Debt . Future maturities under the Notes is as follows: (In Thousands) For Years ending December 31, Senior Secured Notes 2020 $ 1,100 2021 1,100 2022 1,100 2023 1,100 2024 103,525 $ 107,925 Covenants . The indenture governing the Notes contains customary representations and warranties, events of default, and positive and negative covenants, including financial covenants. The Company is required to maintain a total leverage ratio (as defined below), which measures Consolidated EBITDA (as defined in the indenture) against outstanding debt. The Company is allowed to deduct up to $15 million of its cash and equivalents (beyond estimated cash utilized in daily operations) in calculating the numerator of such ratio. Maximum Total Leverage Four Fiscal Quarters Ending Ratio December 31, 2019 6.00 to 1.00 March 31, 2020 6.00 to 1.00 June 30, 2020 5.75 to 1.00 September 30, 2020 5.75 to 1.00 December 31, 2020 5.50 to 1.00 March 31, 2021 5.50 to 1.00 June 30, 2021 5.25 to 1.00 September 30, 2021 5.25 to 1.00 December 31, 2021 5.00 to 1.00 March 31, 2022 4.75 to 1.00 June 30, 2022 4.75 to 1.00 September 30, 2022 4.75 to 1.00 December 31, 2022 4.75 to 1.00 March 31, 2023 and the last day of each fiscal quarter thereafter 4.50 to 1.00 We were in compliance with our financial covenants as of December 31, 2019. However, there can be no assurances that we will remain in compliance with all covenants in the future and/or that we would be successful in obtaining waivers or modifications in the event of noncompliance. Interest Rate Cap Agreement. In April 2018, the Company purchased an Interest Rate Cap from Capital One, N.A. (“Capital One”) for $238,000 in order to manage expected interest rate increases on the Notes. The agreement is for a notional amount of $50 million and expires on March 31, 2021. The Interest Rate Cap has a strike rate of 3.00% and resets every three months at the end of March, June, September, and December. If the three-month LIBOR exceeds the strike rate at the end of any covered period, the Company will receive cash payments from Capital One. Based on fair value measurements using Level 2 inputs (see Note 2), the Company adjusts the carrying value of the Interest Rate Cap quarterly. Since the Company did not elect for hedge accounting, any adjustments to the carrying value between reporting periods are charged to interest expense on the consolidated statement of operations (see Note 12). Common Stock Warrant Liability As part of the Second Lien Credit Facility, the Company granted the second lien lenders 1,006,568 warrants. The warrants have an exercise price of $1.67 (the average trading price of the Company’s common stock during a 60‑day period bracketing the completion of the financing) and expire on May 13, 2026. The warrants also provide the warrant holders with redemption rights, pre-emptive rights under certain circumstances to maintain their percentage of ownership in the Company, piggyback registration rights and mandatory registration rights after two years. In addition to a refinancing, the redemption rights allow the warrant holders, at their option, to require the Company to repurchase all or a portion of the warrants upon the occurrence of certain events, including: (i) a liquidity event, as defined in the warrant purchase agreement, or (ii) the Company’s insolvency. The repurchase value is the 21‑day average price of the Company’s stock at the time of such liquidity event, net of the warrant exercise price. If the redemption rights are exercised, the repurchase amount is payable by the Company in cash or through the issuance of an unsecured note with a four-year term and a minimum interest rate of 13.25%, as further defined in the warrant purchase agreement, and would be guaranteed by the Company’s subsidiaries. Alternatively, the warrant-holders may choose to have the Company register and sell the shares related to the warrants through a public stock offering. The extinguishment of the Second Lien Credit Facility discussed previously is considered a “triggering event” for the possible redemption or registration of the warrants, as further detailed below. The Company’s warrant-holders have not yet requested the redemption or registration of their outstanding warrants, though they may do so on any six-month anniversary of the refinancing date prior to warrant expiration. Accordingly, the obligation is reflected as a current liability as of December 31, 2019 (see Note 12). The Company measures the fair value of the warrants at each reporting period using Level 3 inputs (see Note 2). Due to the variable terms regarding the timing of the settlement of the warrants, the Company utilized a “Monte Carlo” simulation approach to measure the fair value of the warrants. The simulation included certain estimates by Company management regarding the estimated timing of the settlement of the warrants. Significant increases or decreases in those management estimates would result in a significantly higher or lower fair value measurement. At December 31, 2019, the simulation included the following assumptions: an expected contractual term of 6.37 years, an expected stock price volatility rate of 46.87%, an expected dividend yield of 0%, and an expected risk-free interest rate of 1.79%. The Company also used the Monte Carlo simulation approach for its valuation at December 31, 2018, which included the following assumptions: an expected contractual term of 7.37 years, an expected stock price volatility rate of 43.26%, an expected dividend yield of 0%, and an expected risk-free interest rate of 2.64%. The Company recognized $1.2 million of other non-operating expense in 2019 and $1.7 million of other non-operating income during 2018, associated with changes in the fair value of the warrant liability. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
LEASES | 7. LEASES The Company has no material leases in which it is the lessor. As lessee, the Company has one finance lease for a hotel and various operating leases for land, casino and office space, equipment, buildings, and signage. The Company’s remaining lease terms, including extensions, range from one month to approximately 38 years. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants, but the land lease at Silver Slipper does include contingent rent as further discussed below. Operating Leases Silver Slipper Casino Land Lease through April 2058 and Options to Purchase. In 2004, the Company’s subsidiary, Silver Slipper Casino Venture, LLC, entered into a land lease with Cure Land Company, LLC for approximately 31 acres of marshlands and a seven-acre parcel on which the Silver Slipper Casino and Hotel is situated. The land lease includes base monthly payments of $77,500 plus contingent rents of 3% of monthly gross gaming revenue (as defined) in excess of $3.65 million with no scheduled base rent increases through the remaining lease term ending in 2058. We recognized $1.6 million of rent expense, including $0.6 million of contingent rents, during 2019, and $1.5 million of rent expense, including $0.6 million of contingent rents, during 2018. The land lease currently includes an exclusive option to purchase the leased land at any time through October 1, 2027, for $15.5 million plus a seller-retained interest in Silver Slipper Casino and Hotel’s operations of 3% of net income (as defined), for 10 years from the purchase date. In the event that the Company sells or transfers either: (i) substantially all of the assets of Silver Slipper Casino Venture, LLC or (ii) its membership interests in Silver Slipper Casino Venture, LLC in its entirety, the purchase price will increase to $17.1 million, plus the retained interest mentioned above. In either case, the Company also has an option to purchase a four-acre portion from the total 38 acres of leased land for $2.0 million in connection with the development of an owned hotel, which may be exercised at any time and would accordingly reduce the purchase price of the remaining land by $2.0 million. Following a buy-out of the lease, the property would have to purchase or otherwise provide for its drinking water, which is currently provided by the landlord as part of the lease. Bronco Billy’s Lease through January 2035 and Option to Purchase. Bronco Billy’s leases certain parking lots and buildings, including a portion of the hotel and casino, under a long-term lease for $30,000 per month in rent. The lease term includes six renewal options in three-year increments to 2035. In May 2019, Bronco Billy’s exercised its second renewal option to extend the lease term through January 31, 2023, which will increase the monthly rent to $32,500 beginning in February 2021. The lease also contains a $7.6 million purchase option exercisable at any time during the lease term, or as extended, and a right of first refusal on any sale of the property. Christmas Casino at Bronco Billy’s through August 2021 and Option to Purchase. As part of the Bronco Billy’s expansion, the Company leased a closed casino in August 2018 and opened it as the rebranded Christmas Casino in November 2018. The lease includes a minimum three-year term with annual lease payments of $0.2 million, and can be extended an additional two years with annual lease payments of $0.3 million. The Company can also purchase the casino at any time during the lease term, or as extended. The purchase price is $2.6 million if bought by October 31, 2020, increasing by $0.1 million on each anniversary thereafter up to $2.8 million. Grand Lodge Casino Lease through August 2023. The Company’s subsidiary, Gaming Entertainment (Nevada), LLC, has a lease with Hyatt Equities L.L.C. (“Hyatt”) to operate the Grand Lodge Casino. The lease is collateralized by the Company’s interests under the lease and property (as defined in the lease) and is subordinate to the liens of the Notes (see Note 6). Hyatt currently has an option to purchase our leasehold interest and related operating assets of the Grand Lodge Casino, subject to assumption of applicable liabilities. The option price is an amount equal to the Grand Lodge Casino’s positive working capital, plus Grand Lodge Casino’s earnings before interest, income taxes, depreciation and amortization (“EBITDA”) for the twelve-month period preceding the acquisition (or pro-rated if less than twelve months remain on the lease), plus the fair market value of the Grand Lodge Casino’s personal property. Commencing January 1, 2018, the monthly rent payment increased from $145,833 to $166,667. We recognized $2.0 million of rent expense related to this lease during 2019 and 2018. Corporate Office Lease through January 2025. In June 2017, the Company leased 4,479 square feet of office space in Las Vegas, Nevada. Annual rent is approximately $0.2 million and the term of the office lease expires in January 2025. Finance Lease Rising Star Casino Hotel Lease through October 2027 and Option to Purchase. The Company’s Indiana subsidiary, Gaming Entertainment (Indiana) LLC, leases a 104‑room hotel at Rising Star Casino Resort. The lease expires on October 1, 2027, and lease payments are as follows: (i) $48,537 per month from April 2016 through March 2017, (ii) $56,537 per month from April 2017 through March 2018; (iii) $57,537 per month from April 2018 through March 2019; and (iv) $63,537 per month from April 2019 through March 2020. Beginning April 1, 2020 through the end of the lease, the scheduled monthly payment will be $54,326. The Company was also required to make certain improvements to the Rising Star Casino Resort of at least $1 million by March 31, 2017, which the Company satisfied. The lease payments include an annual interest rate of 3.5% through September 30, 2017 and 4.5% thereafter. On September 17, 2017, the Company entered into a second amendment to the lease agreement to facilitate construction of the RV park that adjoins the leased hotel. At any time during the lease term, the Company has the option to purchase the hotel at a price based upon the project’s original cost of $7.7 million (see Note 3), reduced by the cumulative principal finance lease payments made by the Company during the lease term. At December 31, 2019, such net amount was $4.3 million. Upon expiration of the lease term in October 2027, (i) the Landlord has the right to sell the hotel to the Company, and (ii) the Company has the option to purchase the hotel. In either case, the purchase price is $1 plus closing costs. The lease agreement is not guaranteed by the parent company or any subsidiary, other than Gaming Entertainment (Indiana) LLC, and has customary provisions in the event of a default. Leases recorded on the balance sheet consist of the following: (In Thousands) Leases Balance Sheet Classification December 31, 2019 Assets Operating lease assets Operating Lease Right-of-Use Assets, Net $ 19,171 Finance lease assets Property and Equipment, Net (1) 5,037 Total lease assets $ 24,208 Liabilities Current Operating Current Portion of Operating Lease Obligations $ 2,707 Finance Current Portion of Finance Lease Obligation 448 Noncurrent Operating Operating Lease Obligations, Net of Current Portion 16,706 Finance Finance Lease Obligation, Net of Current Portion 3,829 Total lease liabilities $ 23,690 (1) Finance lease assets are recorded net of accumulated amortization of $2.7 million as of December 31, 2019. The components of lease expense are as follows: (In Thousands) Year Ended Lease Costs Statement of Operations Classification December 31, 2019 Operating leases: Fixed/base rent Selling, General and Administrative Expenses $ 3,920 Variable payments Selling, General and Administrative Expenses 788 Finance lease: Amortization of leased assets Depreciation and Amortization 158 Interest on lease liabilities Interest Expense, Net 206 Total lease costs $ 5,072 Maturities of lease liabilities are summarized as follows: (In Thousands) Operating Financing Year Ending December 31, Leases (1) Lease (2) 2020 $ 4,815 $ 616 2021 4,684 652 2022 4,468 652 2023 2,876 652 2024 1,135 652 Thereafter 31,018 1,847 Total future minimum lease payments 48,996 5,071 Less: Amount representing interest (28,186) (794) Present value of lease liabilities 20,810 4,277 Less: Current lease obligations (2,707) (448) Long-term lease obligations $ 18,103 $ 3,829 (1) As of December 31, 2019, the Company has an operating lease that has not yet commenced for which the present value of lease payments over the lease term totals $1.4 million. Accordingly, this lease is not recorded on the Consolidated Balance Sheet at December 31, 2019. This operating lease will commence in 2020 with a term of 3.5 years. (2) The Company’s only material finance lease is at Rising Star Casino Resort for a 104-room hotel. Other information related to lease term and discount rate is as follows: Lease Term and Discount Rate December 31, 2019 Weighted-average remaining lease term Operating leases years Finance lease years Weighted-average discount rate Operating leases (1) % Finance lease % (1) Upon adoption of the new lease standard, discount rates used for existing operating leases were established on January 1, 2019. Supplemental cash flow information related to leases is as follows: (In Thousands) Year Ended Cash paid for amounts included in the measurement of lease liabilities: December 31, 2019 Operating cash flows for operating leases $ 3,933 Operating cash flows for finance lease $ 206 Financing cash flows for finance lease $ 544 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 8. INCOME TAXES The income tax expense attributable to the Company’s loss before income taxes consisted of the following: (In Thousands) Years Ended December 31, 2019 2018 Current Taxes Federal $ — $ — State — — — — Deferred Taxes Federal (1,016) (587) State (743) (651) Increase in valuation allowance 1,839 1,714 80 476 $ 80 $ 476 A reconciliation of the federal income tax statutory rate and the Company’s effective tax rate is as follows: (In Thousands) Years Ended December 31, 2019 2018 Tax Rate Reconciliation Percent Amount Percent Amount Federal income tax benefit at U.S. statutory rate 21.0 % $ (1,208) 21.0 % $ (817) State taxes, net of federal benefit 10.2 % (587) 13.2 % (515) Change in valuation allowance (1) (32.0) % 1,839 (44.0) % 1,714 Permanent differences (3.7) % 215 (6.3) % 247 Credits 2.7 % (156) 3.7 % (146) Other 0.4 % (23) 0.2 % (7) (1.4) % $ 80 (12.2) % $ 476 (1) For 2018, this change is presented with tax reform consideration. The Company’s deferred tax assets (liabilities) consisted of the following: (In Thousands) December 31, 2019 2018 Deferred tax assets: Deferred compensation $ 591 $ 744 Intangible assets and amortization 3,761 4,023 Net operating loss carry-forwards 7,834 6,210 Accrued expenses 853 975 Allowance for doubtful accounts 32 22 Credits 668 481 Common stock warrant liability 402 69 Loan Fees 129 — Interest valuation 65 40 Interest limitation 1,712 1,362 Lease liabilities 4,345 — Charitable contribution carry-forward 125 97 Valuation allowance (10,964) (9,125) 9,553 4,898 Deferred tax liabilities: Depreciation of fixed assets (1,711) (1,939) Amortization of indefinite-lived intangibles (2,803) (2,232) Prepaid expenses (656) (710) Effect of state taxes on future federal returns (785) (629) Right of use assets (4,282) — Other (28) (20) (10,265) (5,530) $ (712) $ (632) As of December 31, 2019, the Company had federal net operating loss carryforward totaling $22.1 million and state tax carryforwards of $56.2 million. Regarding the federal net operating loss carryforward, $14.0 million can be carried forward 20 years and will begin to expire in 2035; the remaining amount can be carried forward indefinitely. Regarding the state tax carryforwards, $55.9 million can be carried forward 20 years and will begin to expire in 2035; the remaining amount can be carried forward indefinitely. The Company also has general business credits of $0.7 million which begin to expire in 2035. In assessing the realizability of its deferred tax assets, the Company considered whether it is “more likely than not” that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considered the scheduled reversal of existing deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. The Company evaluated both positive and negative evidence in determining the need for a valuation allowance. The Company continues to assess the realizability of deferred tax assets and concluded that it has not met the “more likely than not” threshold. As of December 31, 2019, the Company continues to provide a valuation allowance against its deferred tax assets that cannot be offset by existing deferred tax liabilities. In accordance with Accounting Standards Codification 740 (“ASC 740”), this assessment has taken into consideration the jurisdictions in which these deferred tax assets reside. The valuation allowance against deferred tax assets has no effect on the actual taxes paid or owed by the Company. As of December 31, 2019 and 2018, the Company had $0.7 million and $0.6 million, respectively, of deferred tax liabilities relating to goodwill and other indefinite-lived intangibles net of the maximum benefit allowed under the statute after netting with the indefinite-lived deferred tax assets. Subsequent to the Company’s filing of its annual report on Form 10-K for the period ended December 31, 2018, the Company corrected the impact of the 2017 Tax Act on deferred tax liabilities to reflect that indefinite-lived deferred tax liabilities of $1.6 million should be netted against certain deferred tax assets and net operating loss carryforwards for purposes of assessing the realizability of those assets. As a result, the Company has reduced the previously reported valuation allowance as of January 1, 2018, by $1.6 million with a resulting decrease in deferred tax liabilities and accumulated deficit at December 31, 2018 of $1.6 million. Management believes that the impact of this adjustment is immaterial to the previously issued Consolidated Financial Statements. The Company’s utilization of net operating loss (NOL) and the general business tax credit carryforwards may be subject to an annual limitation under Section 382 and 383 of the Internal Revenue Code of 1986 (IRC), and similar state provisions’ due to ownership changes that may have occurred or that could occur in the future. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382 and 383, results from transactions increasing ownership of certain stockholders or public groups in the stock of the corporation by more than 50 percentage points over a three-year period. The Company has completed an IRC Section 382/383 analysis to determine if there are any annual limitations on the utilization of NOLs and tax credit carryforwards, and has determined that it is more likely than not that there have not been any of such greater-than-50% ownership changes during the last five years that would prohibit the Company from utilizing all of its tax attributes. Management has made an annual analysis of its state and federal tax returns and concluded that the Company has no recordable liability, as of December 31, 2019 or 2018, for unrecognized tax benefits as a result of uncertain tax positions taken. As of December 31, 2019, the Company is subject to U.S. federal income tax examinations for the tax years 2016 through 2019. In addition, the Company is subject to state and local income tax examinations for various tax years in the taxing jurisdictions in which the Company operates. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9. COMMITMENTS AND CONTINGENCIES Litigation The Company is party to a number of pending legal proceedings related to matters that occurred in the normal course of business. Management does not expect that the outcome of any such proceedings, either individually or in the aggregate, will have a material effect on our financial position, results of operations and cash flows. Options to Purchase or Lease Land La Posada del Llano Racetrack Proposal in New Mexico. During July 2018, the Company paid $125,000 for options to purchase approximately 520 acres of adjoining land in Clovis, New Mexico as part of its racetrack casino proposal to the New Mexico Racing Commission. The proposal was in response to the New Mexico Racing Commission’s request for proposals related to the potential issuance of the state’s sixth racing license. During July 2019, the Company paid an additional $125,000 in total to renew these two options, as detailed below. In August 2019, the New Mexico Racing Commission announced that it would not issue the sixth racing license at this time, but may do so in the future. The New Mexico options consisted of: · A $75,000 option to purchase 200 acres of land, which ended on the earlier of either July 2019 or 60 days following the granting of the sixth license to conduct horseracing by the New Mexico Racing Commission and New Mexico Gaming Control Board (“License Award”) and all related approvals, permits, and other licenses. In July 2019, the Company extended the purchase option by one year for another $75,000 under the same terms. Prior to the end of this first option extension, the Company may extend the purchase option by one year for an additional $75,000 under the same terms. Additionally, prior to the end of this first extension period, or as further extended, the Company may purchase the land for $1.4 million, which can be reduced by the option payments. · A $50,000 option to purchase 320 acres of land, which ended on the earlier of either July 2019 or 60 days following the granting of the License Award and all related approvals, permits, and other licenses. In July 2019, the Company extended the purchase option by one year for another $50,000 under the same terms. Prior to the end of this option extension, the Company may purchase the land for $1.6 million, which can be reduced by the option payments. Employment Agreements The Company has entered into employment agreements with certain of its key employees. The agreements may provide the employee with a base salary, bonus, restricted stock grants, stock options and other customary benefits. Certain agreements also provide for severance in the event the employee resigns with “good reason,” or the employee is terminated without “cause” or due to a “change of control,” as defined in the agreements. The severance amounts vary with the terms of the agreements and may include the acceleration and vesting of certain unvested shares and stock-based awards upon a change of control, along with continuation of insurance costs and certain other benefits. Defined Contribution Plan We sponsor a defined contribution plan for all eligible employees providing for voluntary contributions by eligible employees and matching contributions made by us. Matching contributions made by us were $0.3 million for each of 2019 and 2018, excluding nominal administrative expenses assumed. For 2019 and 2018, the Company’s employer contribution rate was 50% up to 4% of compensation. Liquidity, Concentrations and Economic Risks and Uncertainties The Company carries cash on deposit with financial institutions that may be in excess of federally-insured limits. The extent of any loss that might be incurred as a result of uninsured deposits in the event of a future failure of a bank or other financial institution, if any, is not subject to estimation at this time. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | 10. STOCKHOLDERS’ EQUITY In March 2018, the Company closed on a registered direct offering for a total of 3,943,333 shares of its common stock at a price of $3.00 per share, resulting in gross proceeds to the Company of $11.8 million. Net proceeds to the Company from the offering were approximately $11.4 million, after deducting placement agent fees and offering expenses. Net proceeds from this offering were used for general corporate purposes, including Phase One of the expansion of Bronco Billy’s Casino and Hotel. Amongst other items, Phase One included the purchase of the Imperial Hotel, the rebranding and reopening of the Imperial Hotel and Casino as the Christmas Casino & Inn, and the design and construction of a parking garage. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | 11. STOCK-BASED COMPENSATION 2015 Equity Incentive Plan. During the second quarter of 2017, the Company’s stockholders approved an amendment to the 2015 Equity Incentive Plan (“2015 Plan”) that increased the number of shares of common stock available for issuance under the 2015 Plan from 1,400,000 to 2,500,000. In addition to the increase in the number of authorized shares issuable under the 2015 Plan, the amendment included several “best practices” changes. The 2015 Plan includes new shares reserved for issuance to directors, employees and consultants and allows for a variety of forms of awards, including stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalents and performance-based compensation. Stock option awards have maximum 10‑year terms and all awards issued thus far under the 2015 Plan do not vest on an accelerated basis if there is a change in control of the Company, unless the awards are not assumed by the successor, as defined. In May 2017, the Company extended the employment agreement of Daniel R. Lee, the Company’s President and Chief Executive Officer, through November 2020 and simultaneously issued him an option to purchase 240,000 shares of common stock under the 2015 Plan with an exercise price of $2.32. Mr. Lee’s option will vest ratably on a monthly basis between December 1, 2018 and November 30, 2020 in conjunction with his amended employment agreement. Effective as of May 2019, the Company extended the employment agreement of Lewis Fanger, the Company’s Senior Vice President and Chief Financial Officer, through May 2022. In May 2019, the Company also separately issued him an option to purchase 100,000 shares of common stock under the 2015 Plan with an exercise price of $2.23. Mr. Fanger’s option vests annually in equal amounts over a three-year period. In September 2019, the Company issued options to purchase a total of 260,000 additional shares of common stock under the 2015 Plan to various other employees of the Company, all of which have an exercise price of $1.97. These stock options all vest annually in equal amounts over the next three years. In all cases, the exercise price of the options reflects the Company’s closing price on the date of grant. In May 2019, the Company also issued to non-executive members of its Board of Directors, as compensation for their annual service, options to purchase a total of 51,900 shares of common stock under the 2015 Plan with an exercise price of $2.23 and a one-year vesting period; and 21,524 shares of common stock under the 2015 Plan that vested immediately with certain transfer restrictions. As of December 31, 2019, the Company had 489,635 stock-based awards authorized by shareholders and available for grant from the 2015 Plan. Prior to the adoption of the 2015 Plan and outside of the 2006 Plan, in order to recruit its executive officers, the Company issued a non-qualified stock option to purchase 943,834 shares to Daniel R. Lee, its President and Chief Executive Officer, and a non-qualified stock option to purchase 300,000 shares to Lewis Fanger, its Senior Vice President, Chief Financial Officer and Treasurer. Each of these stock options vested over a four-year period and, as of December 31, 2019, these stock options have fully vested. Stock Options. The following table summarizes information related to the Company’s common stock options: Weighted Average Weighted Remaining Number Average Contractual Aggregate of Stock Exercise Term Intrinsic Options Price (in years) Value Options outstanding at January 1, 2019 2,575,774 $ 1.67 Granted 436,900 2.06 Exercised (122,269) 1.84 Canceled/Forfeited (33,333) 2.07 Expired (12,667) 2.81 Options outstanding at December 31, 2019 2,844,405 $ 1.71 6.42 $ 4,667,998 Options exercisable at December 31, 2019 2,181,671 $ 1.56 5.65 $ 3,910,111 Compensation Cost. Compensation expense for the years ended December 31, 2019 and 2018 was $0.3 million and $0.6 million, respectively. These costs are recognized on a straight-line basis over the vesting period of the awards net of forfeitures and are included in selling, general and administrative expense on the consolidated statements of operations. As of December 31, 2019, there was approximately $0.5 million of unrecognized compensation cost related to unvested stock options granted by the Company. This unrecognized compensation cost is expected to be recognized over a weighted-average period of 2.1 years. The Company estimated the fair value of each stock option award on the grant date using the Black-Scholes valuation model. Option valuation models require the input of highly subjective assumptions, and changes in assumptions used can materially affect the fair value estimate. Option valuation weighted-average assumptions were as follows: For the year ended December 31, 2019 2018 Expected volatility 46.17 % 43.33 % Expected dividend yield — % — % Expected term (in years) 5.94 5.86 Weighted average risk free rate 1.87 % 2.93 % The weighted-average grant date fair value of options granted during the years ended December 31, 2019 and 2018 was $0.94 and $1.34 per share, respectively. Expected volatility is based on the historical volatility of our stock price. Dividend yield is based on the estimate of annual dividends expected to be paid at the time of the grant. The expected term considers the contractual term of the option as well as historical exercise and forfeiture behavior. The risk-free interest rate is based on the rates in effect on the grant date for U.S. Treasury instruments with maturities matching the relevant expected term of the award. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12. FAIR VALUE OF FINANCIAL INSTRUMENTS Methods and assumptions used to estimate the fair value of financial instruments are affected by the duration of the instruments and other factors used by market participants to estimate value. The carrying amounts for cash and equivalents, restricted cash, accounts receivable, and accounts payable approximate their estimated fair value because of the short durations of the instruments and inconsequential rates of interest. Management also believes that the carrying value of long-term debt also approximates their estimated fair value because the terms of the facilities are representative of current market conditions. While management believes the carrying value of our finance lease obligation approximates its fair value because certain terms of the lease were recently renegotiated, management also believes that precise estimates are not practical because of the unique nature of the relationships. The following tables present the fair value of those assets and liabilities measured on a recurring basis as of December 31, 2019 and 2018. See Notes 2 and 6 for further information regarding our interest rate cap and common stock warrant liability. (In Thousands) Financial instruments not designated December 31, 2019 for hedging: Balance Sheet Location Level 1 Level 2 Level 3 Total Interest rate cap Deposits and other assets $ — $ — $ — $ — Common stock warrants Common stock warrant liability — — 2,055 $ 2,055 (In Thousands) Financial instruments not designated December 31, 2018 for hedging: Balance Sheet Location Level 1 Level 2 Level 3 Total Interest rate cap Deposits and other assets $ — $ 92 $ — $ 92 Common stock warrants Common stock warrant liability — — 825 $ 825 |
SEGMENT REPORTING AND DISAGGREG
SEGMENT REPORTING AND DISAGGREGATED REVENUE | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING AND DISAGGREGATED REVENUE | 13. SEGMENT REPORTING We manage our casinos based on geographic regions within the United States. The casino/resort operations includes four segments: the Silver Slipper Casino and Hotel (Hancock County, Mississippi); Bronco Billy’s Casino and Hotel (Cripple Creek, Colorado); the Rising Star Casino Resort (Rising Sun, Indiana); and the Northern Nevada segment, consisting of the Grand Lodge Casino (Incline Village, Nevada) and Stockman’s Casino (Fallon, Nevada). The Company utilizes Adjusted Property EBITDA as the measure of segment profit in assessing performance and allocating resources at the reportable segment level. Adjusted Property EBITDA is defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, pre-opening expenses, impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, project development and acquisition costs, non-cash stock-based compensation expense, and corporate-related costs and expenses that are not allocated to each property. The following tables present the Company’s segment information: (In Thousands) For the Year Ended December 31, 2019 2018 Net Revenues Silver Slipper Casino and Hotel $ 73,201 $ 69,350 Rising Star Casino Resort 45,620 47,966 Bronco Billy's Casino and Hotel 27,507 26,942 Northern Nevada Casinos 19,104 19,629 $ 165,432 $ 163,887 Adjusted Property EBITDA Silver Slipper Casino and Hotel $ 13,159 $ 12,126 Rising Star Casino Resort 1,330 2,806 Bronco Billy's Casino and Hotel 3,000 3,919 Northern Nevada Casinos 3,161 3,375 20,650 22,226 Other operating (expense) income: Depreciation and amortization (8,331) (8,397) Corporate expenses (4,710) (4,575) Preopening costs — (274) Project development costs (1,037) (843) Loss on disposal of assets, net (8) (79) Stock-based compensation (348) (632) Operating income 6,216 7,426 Other (expense) income: Interest expense (10,728) (10,306) Loss on extinguishment of debt — (2,673) Adjustment to fair value of warrants (1,230) 1,671 Other — (13) (11,958) (11,321) Loss before income taxes (5,742) (3,895) Income tax expense 80 476 Net loss $ (5,822) $ (4,371) (In Thousands) December 31, 2019 2018 Total Assets Silver Slipper Casino and Hotel $ 87,980 $ 79,094 Rising Star Casino Resort 40,277 39,722 Bronco Billy's Casino and Hotel 45,034 42,780 Northern Nevada Casinos 18,612 12,395 Corporate and Other 19,432 8,281 $ 211,335 $ 182,272 (In Thousands) December 31, 2019 2018 Property and Equipment, net Silver Slipper Casino and Hotel $ 55,127 $ 56,369 Rising Star Casino Resort 32,824 33,700 Bronco Billy's Casino and Hotel 25,164 23,354 Northern Nevada Casinos 7,297 7,434 Corporate and Other 1,075 1,219 $ 121,487 $ 122,076 |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | 14. SUBSEQUENT EVENTS As a precautionary measure against the ongoing spread of COVID-19 (coronavirus), various state governments ordered the temporary closure of all casinos in their respective states. Accordingly, Rising Star Casino Resort temporarily suspended operations on March 16, 2020, Silver Slipper Casino and Hotel temporarily suspended operations on March 17, 2020, Bronco Billy’s Casino and Hotel temporarily suspended operations on March 17, 2020, and Grand Lodge Casino and Stockman’s Casino temporarily suspended operations on March 18, 2020. While these closures are expected to be temporary, the current circumstances are dynamic and the impacts of COVID-19 on our business operations, including the duration and impact on overall customer demand, the timing of the reopening of our casinos, new information which may emerge concerning the severity of the coronavirus, and the actions to contain the coronavirus or treat its impact, among others, cannot be reasonably estimated at this time and we anticipate this could have a material adverse impact on our business, results of operations, financial position and cash flows. Because we operate in several different jurisdictions, some of our casinos may be permitted to reopen prior to others. The Company will work diligently to reopen its casinos as soon as it is permitted to do so, subject to management’s discretion to voluntarily extend such closures. We currently believe that, through our approximately $28.9 million of cash and equivalents as of December 31, 2019, we have the liquidity necessary to sustain closure for a period of time that extends beyond the currently-mandated closure periods. Additionally, as of December 31, 2019, we had $1.0 million of restricted cash. In March 2020, such cash was no longer categorized as restricted, as the Company was approved for its “master license” for sports betting by the Colorado Limited Gaming Control Commission on March 19, 2020. To preserve liquidity, upon the temporary closure of our properties in March 2020, we significantly reduced staffing levels at each of our properties and at our corporate office to a small group of essential employees. We also recently elected to pause construction of the Phase One parking garage at Bronco Billy’s, allowing us to use the cash designated for such construction to provide the Company with additional liquidity until our casinos are permitted to reopen. No assurance can be given that, should the casino closures extend for a prolonged period and require us to seek additional liquidity, we will be able to successfully raise additional funds through either the issuance of new debt or new equity or the sale of assets. As stated above, the Company will work diligently to reopen its casinos as soon as it is permitted to do so. Because we operate in several different jurisdictions, some of our casinos may be permitted to reopen prior to others. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation and Accounting | Principles of Consolidation and Accounting. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Except when otherwise required by accounting principles generally accepted in the United States of America (“GAAP”) and disclosed herein, the Company measures all of its assets and liabilities on the historical cost basis of accounting. |
Use of Estimates | Use of Estimates. The consolidated financial statements have been prepared in conformity with GAAP. These principles require the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. |
Liquidity and Going Concern | Liquidity and Going Concern. The consolidated financial statements have been prepared on the going concern basis of accounting, assuming the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company’s casinos are its primary sources of income and operating cash flows and they are relied upon to remain in compliance with debt covenants and meet the Company’s obligations when due. As described in Note 6, the Senior Secured Notes agreement requires the Company to maintain a total leverage ratio covenant, which measures Consolidated EBITDA (as defined in the indenture) against outstanding debt. As detailed in in Note 14, in March 2020, the Company temporarily suspended operations at its casinos and hotels pursuant to orders from governmental authorities as a precautionary measure against the ongoing spread of COVID-19, a highly contagious coronavirus that was declared a pandemic by the World Health Organization. As the COVID-19 situation is dynamic, the Company does not currently know with certainty when it will be permitted to reopen its casinos and hotels. Management believes it has sufficient resources to fund its currently-reduced operations, consisting principally of preservation of assets and a core staff necessary to plan for reopening, for several months. However, management does not control and is not qualified to predict the length of the closure of its casinos and hotels due to the pandemic. It is also possible that some of the Company’s operations may be allowed to open sooner than others, depending on the regional impact of the pandemic. As described in Note 2 to this Form 10-K for the period ended December 31, 2019, a significant period of closure or significant declines in business volumes upon reopening would negatively impact our ability to remain in compliance with our debt covenants. In the event that the Company would fail to meet its debt covenants in the next twelve months, the Company would either seek covenant waivers or attempt to amend its covenants, though there is no certainty that the Company would be successful in such efforts. Additionally, the Company could seek additional liquidity through the issuance of new debt or equity, or through the sale of certain assets. Successful completion of such items, if needed, would be dependent in part on factors outside of the Company’s control. ASC 205-40, Going Concern, calls for management to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within twelve months after the date that the financial statements are issued. Because of the length of this look-forward period and the substantial items that are outside of its control, and despite its intent and best efforts to overcome the challenges in the current environment, management concluded that there is substantial doubt as to the Company’s ability to continue as a going concern. The Company is attempting to mitigate the impacts of the coronavirus on the Company through the plans described above. |
Fair Value and the Fair Value Input Hierarchy | Fair Value and the Fair Value Input Hierarchy. Fair value measurements affect the Company’s accounting for net assets acquired in acquisition transactions and certain financial assets and liabilities, such as its common stock warrant liability and interest rate cap. Fair value measurements are also used in its periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets. Fair value is defined as the expected price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. GAAP categorizes the inputs used for fair value into a three-level hierarchy: · Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; · Level 2: Comparable inputs, other than quoted prices, that are observable for similar assets or liabilities in less active markets; and · Level 3: Unobservable inputs, which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. The Company utilizes Level 2 inputs when measuring the fair value of its interest rate cap. In order to estimate the fair value of this derivative instrument, the Company obtains valuation reports from the third-party broker that issued the interest rate cap. The report contemplates fair value by using inputs including market-observable data such as interest rate curves, volatilities, and information derived from or corroborated by that market-observable data (see Notes 6 and 12). The Company utilizes Level 3 inputs when measuring the fair value of net assets acquired in business combination transactions, subsequent assessments for impairment, and most financial instruments, including but not limited to the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Notes 6 and 12). |
Cash Equivalents and Restricted Cash | Cash Equivalents and Restricted Cash. Cash equivalents include cash involved in operations and cash in excess of daily requirements that is invested in highly liquid, short-term investments with initial maturities of three months or less when purchased. Restricted cash balances are funds received from certain sports wagering agreements that have not commenced and are contractually required to be separated from the Company’s operating cash. Upon receipt of authorization from gaming authorities in Colorado, these restricted cash balances will no longer have restrictions, and accordingly will be reclassified on the balance sheet as cash and equivalents. Cash, cash equivalents and restricted cash consisted of the following: (In Thousands) December 31, 2019 2018 Cash and equivalents $ 28,851 $ 20,634 Restricted cash 1,000 — $ 29,851 $ 20,634 |
Accounts Receivable | Accounts Receivable. Accounts receivable consist primarily of casino, hotel and other receivables, are typically non-interest bearing, and are carried net of an appropriate collection allowance to approximate fair value. Allowances for doubtful accounts are estimated based on specific review of customer accounts including the customers’ willingness and ability to pay and nature of collateral, if any, as well as historical collection experience and current economic and business conditions. Accounts are written off when management deems the account to be uncollectible and recoveries of accounts previously written off are recorded when received. |
Inventories | Inventories. Inventories consist primarily of food, beverage and retail items, and are stated at the lower of cost or net realizable value. Costs are determined using the first-in, first-out and the weighted average methods. |
Property and Equipment | Property and Equipment. Property and equipment are stated at cost and are capitalized and depreciated, while normal repairs and maintenance are expensed in the period incurred. A significant amount of the Company’s property and equipment was acquired through business combinations, and therefore, are recognized at fair value measured at the acquisition date. Gains or losses on dispositions of property and equipment are included in operating expenses, effectively as adjustments to depreciation estimates. Certain events or changes in circumstances may indicate that the recoverability of the carrying amount of property, plant and equipment should be assessed, including, among others, a significant decrease in market value, a significant change in the business climate in a particular market, or a current period operating or cash flow loss combined with historical losses or projected future losses. When such events or changes in circumstances are present, the Company estimates the future cash flows expected to result from the use of the asset (or asset group) and its eventual disposition. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, then the Company would recognize an impairment loss. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets or the term of the lease, whichever is appropriate under the circumstances. The Company determines the estimated useful lives based on our experience with similar assets, estimated usage of the asset, and industry practice. Whenever events or circumstances occur, which change the estimated useful life of an asset, the Company accounts for the change prospectively. Depreciation and amortization is provided over the following estimated useful lives: Estimated Class of Assets Useful Lives Land improvements 15 to 18 years Buildings and improvements 3 to 44 years Furniture, fixtures and equipment 2 to 10 years |
Leases | Leases. The Company determines if a contract is, or contains, a lease at inception or modification of the agreement. A contract is, or contains, a lease if there are identified assets and the right to control the use of an identified asset is conveyed for a period of time in exchange for consideration. Control over the use of the identified asset means that the lessee has both the right to obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset. For leases with terms greater than a year, the Company records right-of-use (“ROU”) assets and lease liabilities on the balance sheet, as measured on a discounted basis. For finance leases, the Company recognizes interest expense associated with the lease liability and depreciation expense associated with the ROU asset; for operating leases, the Company recognizes straight-line rent expense. The Company will not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, will be disclosed as a component of lease expenses when applicable. Additionally, the Company accounts for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component by asset class for gaming-related equipment; as a result, the Company will not allocate contract consideration to the separate lease and non-lease components based on their relative standalone prices. Finance and operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate as estimated by third-party valuation specialists in determining the present value of future payments. The expected lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term. |
Goodwill and Indefinite-lived Intangible Assets | Goodwill and Indefinite-lived Intangible Assets. Goodwill represents the excess of the purchase price of Bronco Billy’s Casino and Hotel, Silver Slipper Casino and Hotel, Rising Star Casino Resort and Stockman’s Casino over the estimated fair value of their net tangible and other intangible assets on the acquisition date, net of subsequent impairment charges. The Company’s other indefinite-lived intangible assets primarily include certain license rights to conduct gaming in certain jurisdictions and trade names. Goodwill and other indefinite-lived intangible assets are not amortized, but are periodically tested for impairment. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value. The evaluation of goodwill and other indefinite-lived intangible assets requires the use of estimates about future operating results, valuation multiples and discount rates to determine the estimated fair value. Changes in the assumptions can materially affect these estimates. Thus, to the extent that gaming volumes deteriorate in the near future, discount rates increase significantly, or reporting units do not meet projected performance, the Company could have impairments to record in the future and such impairments could be material. These tests for impairment are performed annually during the fourth quarter or when a triggering event occurs. |
Finite-lived Intangible Assets | Finite-lived Intangible Assets. The Company’s finite-lived intangible assets includes customer loyalty programs, land lease acquisition costs and water rights. Finite-lived intangible assets are amortized over the shorter of their contractual or economic lives. The Company periodically evaluates the remaining useful lives of these intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization and the possible need for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, then the Company would recognize an impairment loss. |
Debt Issuance Costs and Debt Discounts | Debt Issuance Costs and Debt Discounts. Debt issuance costs and debt discounts incurred in connection with the issuance of debt have been included as a component of the carrying amount of debt, and are amortized over the contractual term of the debt to interest expense, using the effective interest method. When its existing debt agreements are determined to have been modified, the Company amortizes such costs to interest expense using the effective interest method over the terms of the modified debt agreement. |
Revenue Recognition of Accrued Club Points and Deferred Revenues | Revenue Recognition of Accrued Club Points and Deferred Revenues: Accrued Club Points: Operating Revenues and Related Costs and Expenses. The Company’s revenues consist primarily of casino gaming, food and beverage, hotel, and other revenues (such as entertainment). The majority of its revenues are derived from casino gaming, principally slot machines. Gaming revenue is the difference between gaming wins and losses, not the total amount wagered. The Company accounts for its gaming transactions on a portfolio basis, as such wagers have similar characteristics and it would not be practical to view each wager on an individual basis. The Company sometimes provides discretionary complimentary goods and services (“discretionary comps”). For these types of transactions, the Company allocates revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Many of the Company’s customers choose to earn points under its customer loyalty programs. As points are accrued, the Company defers a portion of its gaming revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points, primarily for “free casino play/cash back,” complimentary dining, or hotel stays. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Deferred Revenues: Market Access Fees from Sports Wagering Agreements. These liabilities were created in the third quarter of 2019 when the Company entered into several agreements with various unaffiliated companies allowing for online sports wagering within Indiana and Colorado, as well as on-site sports wagering at Rising Star Casino Resort and at Bronco Billy’s Casino and Hotel (the “Sports Agreements”). As part of these longer-term Sports Agreements, the Company received one-time market access fees totaling $6 million in cash, which were recorded as a long-term liability in the same amount and will be recognized as revenue ratably over the initial term length of 10 years, beginning with the commencement of operations. The current and noncurrent portions of the deferred revenues balance totaling $5.99 million for December 31, 2019 is included with “other accrued expenses” and “other” on the consolidated balance sheets, respectively. Of the Company’s Sports Agreements, on-site sports wagering commenced in Indiana in the fourth quarter of 2019, as did one of the Company’s three contracted mobile sports operators in Indiana. The other two contracted parties in Indiana are expected to begin operations in mid-2020. In Colorado, gaming regulators are currently drafting the rules that will govern sports wagering in the state. The Company believes that sports wagering could also begin at its Bronco Billy’s Casino and Hotel – as well as throughout the state via mobile sports wagering – in mid-2020. |
Advertising Costs | Advertising Costs. Costs for advertising are expensed as incurred, or the first time the advertising takes place, and are included in selling, general and administrative expenses. Total advertising costs were $4.2 million and $3.8 million for the years ended December 31, 2019 and 2018, respectively. |
Customer Loyalty Programs | Customer Loyalty Programs. We have separate customer loyalty programs at each of our properties – the Silver Slipper Casino Players Club, Bronco Billy’s Mile High Rewards Club, Rising Star Rewards Club™, Grand Lodge Players Advantage Club® and Stockman’s Winner’s Club. Under these programs, customers earn points based on their volume of wagering that may be redeemed for various benefits, such as free play, cash back, complimentary dining, or hotel stays, among others, depending on each property’s specific offers. Unredeemed points are forfeited if the customer becomes and remains inactive for a specified period of time. Liabilities based on the standalone retail value of such benefits totaling $1.4 million each for December 31, 2019 and 2018, respectively, and these amounts are included in “other accrued expenses” on the consolidated balance sheets. |
Project Development and Acquisition Costs | Project Development and Acquisition Costs . Project development and acquisition costs consist of amounts expended on the pursuit of new business opportunities and acquisitions, which are expensed as incurred. During 2019, these costs were associated with our pursuit to develop and operate American Place, a casino and entertainment destination in Waukegan, Illinois. During 2018, these costs were associated primarily with our pursuit of a racetrack casino in New Mexico, the potential relocation of gaming positions to Terre Haute, Indiana, and acquisition opportunities. |
Share-based Compensation | Stock-based Compensation. Stock-based compensation costs are measured at the grant date, based on the estimated fair value of the award using the Black-Scholes option pricing model for stock options, and based on the closing share price of the Company’s stock on the grant date for other stock-based awards. The cost is recognized as an expense on a straight-line basis over the employee’s requisite service period (the vesting period of the award) net of forfeitures, which are recognized as they occur. |
Legal Defense Costs | Legal Defense Costs. We do not accrue for estimated future legal and related defense costs, if any, to be incurred in connection with outstanding or threatened litigation and other disputed matters. Instead, we record such costs as period costs when the related services are rendered. |
Income Taxes | Income Taxes. We classify deferred tax liabilities and assets, along with any related valuation allowance, as non-current in a classified statement of financial position. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are provided against deferred tax assets when it is deemed more likely than not that some portion or all of the deferred tax asset will not be realized within a reasonable time period. Our income tax returns are subject to examination by the Internal Revenue Service (“IRS”) and other tax authorities. Positions taken in tax returns are sometimes subject to uncertainty in the tax laws and may not ultimately be accepted by the IRS or other tax authorities. We assess our tax positions using a two-step process. A tax position is recognized if it meets a “more likely than not” threshold, and is measured at the largest amount of benefit that is greater than 50 percent likely of being realized. Additionally, we recognize accrued interest and penalties, if any, related to unrecognized tax benefits in income tax expense. |
Earnings (loss) per share | Earnings (loss) per share. Earnings (loss) per share is computed by dividing net income (loss) applicable to common stock by the weighted-average number of common shares outstanding during the period. Diluted earnings per share reflects the additional dilution for all potentially-dilutive securities, including stock options and warrants, using the treasury stock method. (In Thousands) Year Ended December 31, 2019 2018 Numerator: Net loss - basic $ (5,822) $ (4,371) Adjustment for assumed conversion of warrants — (1,671) Net loss - diluted $ (5,822) $ (6,042) Denominator: Weighted-average common and common share equivalents - basic 26,980 26,012 Potential dilution from assumed conversion of warrants — 449 Weighted-average common and common share equivalents - diluted 26,980 26,461 Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share 3,851 2,576 |
Reclassifications | Reclassifications. Certain reclassifications have been made to 2018 amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported results of operations or financial position. |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements: Pronouncement Implemented in 2019. In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASC 842, which replaces the existing guidance for leases and requires expanded disclosures about leasing activities. ASC 842 requires a dual approach for lessee accounting under which a lessee would classify and account for leases as either finance leases or operating leases, both of which result in the lessee recognizing a right-of-use (“ROU”) asset and a corresponding lease liability on the balance sheet, as measured on a discounted basis for leases with terms greater than a year. For finance leases, the lessee will recognize interest expense associated with the lease liability and depreciation expense associated with the ROU asset; for operating leases, the lessee will recognize straight-line rent expense. For publicly-traded companies, ASC 842 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Under the previous guidance for leases through December 31, 2018, rental payments for certain property and equipment used in the Company’s operations under long-term operating leases were recognized as rent expense with scheduled rent increases recognized on a straight-line basis over the initial lease term, without recording a lease asset and obligation. Rental payments for other property and equipment held under capital leases were recognized as a reduction of a finance lease obligation and interest expense. The fixed assets acquired pursuant to finance leases were included in property and equipment and amortized over the term of the lease. Under the modified retrospective transition method, the Company elected to use the effective date approach with the period of adoption on January 1, 2019 as the date of initial application, and therefore, has elected to not recast comparative period financial information. In addition, the Company has elected the package of practical expedients permitted under the transition guidance to allow it to carry forward historical lease classifications, which includes not needing to reassess: (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) measurement of initial direct costs for any existing leases. The Company has also elected the practical expedient for short-term lease measurement and recognition, under which the Company will not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, will be disclosed as a component of lease expenses when applicable. Additionally, the Company has elected the practical expedient to account for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component by asset class for gaming-related equipment; as a result, the Company will not allocate contract consideration to the separate lease and non-lease components based on their relative standalone prices. Pronouncements Not Yet Adopted. Management believes that there are no other recently issued accounting standards not yet effective that are likely to have a material impact on our financial statements. |
ORGANIZATION (Tables)
ORGANIZATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Properties | The following table identifies the properties along with their dates of acquisition and locations: Property Acquisition Location Silver Slipper Casino and Hotel 2012 Hancock County, MS Bronco Billy’s Casino and Hotel 2016 Cripple Creek, CO Rising Star Casino Resort 2011 Rising Sun, IN Stockman’s Casino 2007 Fallon, NV Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) 2011 Incline Village, NV |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Cash, cash equivalents and restricted cash | (In Thousands) December 31, 2019 2018 Cash and equivalents $ 28,851 $ 20,634 Restricted cash 1,000 — $ 29,851 $ 20,634 |
Schedule of estimated useful lives | Depreciation and amortization is provided over the following estimated useful lives: Estimated Class of Assets Useful Lives Land improvements 15 to 18 years Buildings and improvements 3 to 44 years Furniture, fixtures and equipment 2 to 10 years |
Schedule of Earnings Per Share, Basic and Diluted | (In Thousands) Year Ended December 31, 2019 2018 Numerator: Net loss - basic $ (5,822) $ (4,371) Adjustment for assumed conversion of warrants — (1,671) Net loss - diluted $ (5,822) $ (6,042) Denominator: Weighted-average common and common share equivalents - basic 26,980 26,012 Potential dilution from assumed conversion of warrants — 449 Weighted-average common and common share equivalents - diluted 26,980 26,461 Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share 3,851 2,576 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of Property and Equipment | Property and equipment, net consisted of the following: (In Thousands) December 31, 2019 2018 Land and improvements $ 16,144 $ 16,002 Buildings and improvements 114,672 114,001 Furniture and equipment 47,886 45,463 Construction in progress 10,856 6,864 189,558 182,330 Less: Accumulated depreciation (68,071) (60,254) $ 121,487 $ 122,076 |
Schedule of finance leased property and equipment | Property and equipment included assets under finance leases related to our hotel at Rising Star Casino Resort (Note 7) as follows: (In Thousands) December 31, 2019 2018 Leased land and improvements $ 215 $ 215 Leased buildings and improvements 5,787 5,787 Leased furniture and equipment 1,724 1,724 7,726 7,726 Less: Accumulated amortization (2,689) (2,531) $ 5,037 $ 5,195 |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The following tables set forth changes in the carrying value of goodwill by segment: (In Thousands) December 31, 2019 Gross Balance at Carrying Accumulated End of the Value Additions Impairments Year Silver Slipper Casino and Hotel $ 14,671 $ — $ — $ 14,671 Rising Star Casino Resort 1,647 — (1,647) — Bronco Billy's Casino and Hotel 4,806 — — 4,806 Northern Nevada Casinos 5,809 — (4,000) 1,809 $ 26,933 $ — $ (5,647) $ 21,286 (In Thousands) December 31, 2018 Gross Balance at Carrying Accumulated End of the Value Additions Impairments Year Silver Slipper Casino and Hotel $ 14,671 $ — $ — $ 14,671 Rising Star Casino Resort 1,647 — (1,647) — Bronco Billy's Casino and Hotel 4,806 — — 4,806 Northern Nevada Casinos 5,809 — (4,000) 1,809 $ 26,933 $ — $ (5,647) $ 21,286 |
Schedule of other intangible assets, net | The following tables set forth changes in the carrying value of intangible assets other than goodwill: (In Thousands) December 31, 2019 Estimated Gross Accumulated Other Life Carrying Accumulated Impairments, Intangible (Years) Value Amortization Net Assets, Net Customer Loyalty Programs 3 $ 7,600 $ (7,600) $ — $ — Land Lease and Water Rights 46 1,420 (226) — 1,194 Casino Lease Option 3 190 (87) — 103 Gaming Licenses Indefinite 18,046 — (10,203) 7,843 Trade Names Indefinite 1,800 — — 1,800 Trademarks Indefinite 116 — — 116 $ 29,172 $ (7,913) $ (10,203) $ 11,056 (In Thousands) December 31, 2018 Estimated Gross Accumulated Other Life Carrying Accumulated Impairments, Intangible (Years) Value Amortization Net Assets, Net Customer Loyalty Programs 3 $ 7,600 $ (7,600) $ — $ — Land Lease and Water Rights 46 1,420 (195) — 1,225 Casino Lease Option 3 190 (24) — 166 Gaming Licenses Indefinite 18,046 — (10,203) 7,843 Trade Names Indefinite 1,800 — — 1,800 Trademarks Indefinite 111 — — 111 $ 29,167 $ (7,819) $ (10,203) $ 11,145 |
Schedule of future amortization expense for intangible assets | Future amortization expense for intangible assets is as follows: (In Thousands) For Years ending December 31, Amortization Expense 2020 $ 94 2021 70 2022 31 2023 31 2024 31 Thereafter 1,039 $ 1,296 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Liabilities, Current [Abstract] | |
Schedule of other accrued expenses | Other accrued expenses consisted of the following: (In Thousands) December 31, 2019 2018 Player club points and progressive jackpots $ 3,281 $ 3,389 Real estate and personal property taxes 1,730 1,614 Gaming and other taxes 2,082 2,028 Other gaming-related accruals 1,299 1,112 Accrued rent 422 604 Current portion of deferred revenue 100 — Other 1,699 957 $ 10,613 $ 9,704 |
LONG-TERM DEBT AND COMMON STO_2
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt Instrument Redemption | The Company may redeem all or a part of the Notes plus the premium as set forth below, plus accrued and applicable unpaid interest: Redemption Periods Percentage Premium On February 2, 2019 to February 1, 2020 2.0 % On February 2, 2020 to February 1, 2021 1.5 % On February 2, 2021 to February 1, 2022 0.5 % On or after February 2, 2022 — % |
Schedule of Long-Term Debt, Related Discounts and Issuance Costs | Long-term debt, related discounts and issuance costs consisted of the following: (In Thousands) December 31, 2019 2018 Senior Secured Notes $ 107,925 $ 99,000 Less: Unamortized discounts and debt issuance costs (3,902) (3,806) 104,023 95,194 Less: Current portion of long-term debt (1,100) (1,000) $ 102,923 $ 94,194 The Company is allowed to deduct up to $15 million of its cash and equivalents (beyond estimated cash utilized in daily operations) in calculating the numerator of such ratio. Maximum Total Leverage Four Fiscal Quarters Ending Ratio December 31, 2019 6.00 to 1.00 March 31, 2020 6.00 to 1.00 June 30, 2020 5.75 to 1.00 September 30, 2020 5.75 to 1.00 December 31, 2020 5.50 to 1.00 March 31, 2021 5.50 to 1.00 June 30, 2021 5.25 to 1.00 September 30, 2021 5.25 to 1.00 December 31, 2021 5.00 to 1.00 March 31, 2022 4.75 to 1.00 June 30, 2022 4.75 to 1.00 September 30, 2022 4.75 to 1.00 December 31, 2022 4.75 to 1.00 March 31, 2023 and the last day of each fiscal quarter thereafter 4.50 to 1.00 |
Schedule of Maturities of Long-term Debt [Table Text Block] | Future maturities under the Notes is as follows: (In Thousands) For Years ending December 31, Senior Secured Notes 2020 $ 1,100 2021 1,100 2022 1,100 2023 1,100 2024 103,525 $ 107,925 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
Lease Balance Sheet Disclosure | Leases recorded on the balance sheet consist of the following: (In Thousands) Leases Balance Sheet Classification December 31, 2019 Assets Operating lease assets Operating Lease Right-of-Use Assets, Net $ 19,171 Finance lease assets Property and Equipment, Net (1) 5,037 Total lease assets $ 24,208 Liabilities Current Operating Current Portion of Operating Lease Obligations $ 2,707 Finance Current Portion of Finance Lease Obligation 448 Noncurrent Operating Operating Lease Obligations, Net of Current Portion 16,706 Finance Finance Lease Obligation, Net of Current Portion 3,829 Total lease liabilities $ 23,690 Finance lease assets are recorded net of accumulated amortization of $2.7 million as of December 31, 2019. |
Components of Lease Expense, Lease Term and Discount Rate and Cash Flow Information | (In Thousands) Year Ended Lease Costs Statement of Operations Classification December 31, 2019 Operating leases: Fixed/base rent Selling, General and Administrative Expenses $ 3,920 Variable payments Selling, General and Administrative Expenses 788 Finance lease: Amortization of leased assets Depreciation and Amortization 158 Interest on lease liabilities Interest Expense, Net 206 Total lease costs $ 5,072 Other information related to lease term and discount rate is as follows: Lease Term and Discount Rate December 31, 2019 Weighted-average remaining lease term Operating leases years Finance lease years Weighted-average discount rate Operating leases (1) % Finance lease % (1) Upon adoption of the new lease standard, discount rates used for existing operating leases were established on January 1, 2019. Supplemental cash flow information related to leases is as follows: (In Thousands) Year Ended Cash paid for amounts included in the measurement of lease liabilities: December 31, 2019 Operating cash flows for operating leases $ 3,933 Operating cash flows for finance lease $ 206 Financing cash flows for finance lease $ 544 |
Operating Lease, Liability, Maturity | (In Thousands) Operating Financing Year Ending December 31, Leases (1) Lease (2) 2020 $ 4,815 $ 616 2021 4,684 652 2022 4,468 652 2023 2,876 652 2024 1,135 652 Thereafter 31,018 1,847 Total future minimum lease payments 48,996 5,071 Less: Amount representing interest (28,186) (794) Present value of lease liabilities 20,810 4,277 Less: Current lease obligations (2,707) (448) Long-term lease obligations $ 18,103 $ 3,829 (1) As of December 31, 2019, the Company has an operating lease that has not yet commenced for which the present value of lease payments over the lease term totals $1.4 million. Accordingly, this lease is not recorded on the Consolidated Balance Sheet at December 31, 2019. This operating lease will commence in 2020 with a term of 3.5 years. (2) The Company’s only material finance lease is at Rising Star Casino Resort for a 104-room hotel. |
Finance Lease, Liability, Maturity | Maturities of lease liabilities are summarized as follows: (In Thousands) Operating Financing Year Ending December 31, Leases (1) Lease (2) 2020 $ 4,815 $ 616 2021 4,684 652 2022 4,468 652 2023 2,876 652 2024 1,135 652 Thereafter 31,018 1,847 Total future minimum lease payments 48,996 5,071 Less: Amount representing interest (28,186) (794) Present value of lease liabilities 20,810 4,277 Less: Current lease obligations (2,707) (448) Long-term lease obligations $ 18,103 $ 3,829 (1) As of December 31, 2019, the Company has an operating lease that has not yet commenced for which the present value of lease payments over the lease term totals $1.4 million. Accordingly, this lease is not recorded on the Consolidated Balance Sheet at December 31, 2019. This operating lease will commence in 2020 with a term of 3.5 years. (2) The Company’s only material finance lease is at Rising Star Casino Resort for a 104-room hotel. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income tax provision | The income tax expense attributable to the Company’s loss before income taxes consisted of the following: (In Thousands) Years Ended December 31, 2019 2018 Current Taxes Federal $ — $ — State — — — — Deferred Taxes Federal (1,016) (587) State (743) (651) Increase in valuation allowance 1,839 1,714 80 476 $ 80 $ 476 |
Schedule of effective income tax rate reconciliation | A reconciliation of the federal income tax statutory rate and the Company’s effective tax rate is as follows: (In Thousands) Years Ended December 31, 2019 2018 Tax Rate Reconciliation Percent Amount Percent Amount Federal income tax benefit at U.S. statutory rate 21.0 % $ (1,208) 21.0 % $ (817) State taxes, net of federal benefit 10.2 % (587) 13.2 % (515) Change in valuation allowance (1) (32.0) % 1,839 (44.0) % 1,714 Permanent differences (3.7) % 215 (6.3) % 247 Credits 2.7 % (156) 3.7 % (146) Other 0.4 % (23) 0.2 % (7) (1.4) % $ 80 (12.2) % $ 476 For 2018, this change is presented with tax reform consideration. |
Schedule of deferred tax assets and liabilities | The Company’s deferred tax assets (liabilities) consisted of the following: (In Thousands) December 31, 2019 2018 Deferred tax assets: Deferred compensation $ 591 $ 744 Intangible assets and amortization 3,761 4,023 Net operating loss carry-forwards 7,834 6,210 Accrued expenses 853 975 Allowance for doubtful accounts 32 22 Credits 668 481 Common stock warrant liability 402 69 Loan Fees 129 — Interest valuation 65 40 Interest limitation 1,712 1,362 Lease liabilities 4,345 — Charitable contribution carry-forward 125 97 Valuation allowance (10,964) (9,125) 9,553 4,898 Deferred tax liabilities: Depreciation of fixed assets (1,711) (1,939) Amortization of indefinite-lived intangibles (2,803) (2,232) Prepaid expenses (656) (710) Effect of state taxes on future federal returns (785) (629) Right of use assets (4,282) — Other (28) (20) (10,265) (5,530) $ (712) $ (632) |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Common Stock Options | The following table summarizes information related to the Company’s common stock options: Weighted Average Weighted Remaining Number Average Contractual Aggregate of Stock Exercise Term Intrinsic Options Price (in years) Value Options outstanding at January 1, 2019 2,575,774 $ 1.67 Granted 436,900 2.06 Exercised (122,269) 1.84 Canceled/Forfeited (33,333) 2.07 Expired (12,667) 2.81 Options outstanding at December 31, 2019 2,844,405 $ 1.71 6.42 $ 4,667,998 Options exercisable at December 31, 2019 2,181,671 $ 1.56 5.65 $ 3,910,111 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | Option valuation weighted-average assumptions were as follows: For the year ended December 31, 2019 2018 Expected volatility 46.17 % 43.33 % Expected dividend yield — % — % Expected term (in years) 5.94 5.86 Weighted average risk free rate 1.87 % 2.93 % |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Liabilities Measured on Recurring Basis | The following tables present the fair value of those assets and liabilities measured on a recurring basis as of December 31, 2019 and 2018. See Notes 2 and 6 for further information regarding our interest rate cap and common stock warrant liability. (In Thousands) Financial instruments not designated December 31, 2019 for hedging: Balance Sheet Location Level 1 Level 2 Level 3 Total Interest rate cap Deposits and other assets $ — $ — $ — $ — Common stock warrants Common stock warrant liability — — 2,055 $ 2,055 (In Thousands) Financial instruments not designated December 31, 2018 for hedging: Balance Sheet Location Level 1 Level 2 Level 3 Total Interest rate cap Deposits and other assets $ — $ 92 $ — $ 92 Common stock warrants Common stock warrant liability — — 825 $ 825 |
SEGMENT REPORTING AND DISAGGR_2
SEGMENT REPORTING AND DISAGGREGATED REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Selected Statement of Operations Data | The following tables present the Company’s segment information: (In Thousands) For the Year Ended December 31, 2019 2018 Net Revenues Silver Slipper Casino and Hotel $ 73,201 $ 69,350 Rising Star Casino Resort 45,620 47,966 Bronco Billy's Casino and Hotel 27,507 26,942 Northern Nevada Casinos 19,104 19,629 $ 165,432 $ 163,887 Adjusted Property EBITDA Silver Slipper Casino and Hotel $ 13,159 $ 12,126 Rising Star Casino Resort 1,330 2,806 Bronco Billy's Casino and Hotel 3,000 3,919 Northern Nevada Casinos 3,161 3,375 20,650 22,226 Other operating (expense) income: Depreciation and amortization (8,331) (8,397) Corporate expenses (4,710) (4,575) Preopening costs — (274) Project development costs (1,037) (843) Loss on disposal of assets, net (8) (79) Stock-based compensation (348) (632) Operating income 6,216 7,426 Other (expense) income: Interest expense (10,728) (10,306) Loss on extinguishment of debt — (2,673) Adjustment to fair value of warrants (1,230) 1,671 Other — (13) (11,958) (11,321) Loss before income taxes (5,742) (3,895) Income tax expense 80 476 Net loss $ (5,822) $ (4,371) (In Thousands) December 31, 2019 2018 Total Assets Silver Slipper Casino and Hotel $ 87,980 $ 79,094 Rising Star Casino Resort 40,277 39,722 Bronco Billy's Casino and Hotel 45,034 42,780 Northern Nevada Casinos 18,612 12,395 Corporate and Other 19,432 8,281 $ 211,335 $ 182,272 (In Thousands) December 31, 2019 2018 Property and Equipment, net Silver Slipper Casino and Hotel $ 55,127 $ 56,369 Rising Star Casino Resort 32,824 33,700 Bronco Billy's Casino and Hotel 25,164 23,354 Northern Nevada Casinos 7,297 7,434 Corporate and Other 1,075 1,219 $ 121,487 $ 122,076 |
ORGANIZATION (Details)
ORGANIZATION (Details) | Dec. 31, 2019item |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of casinos operated | 5 |
Number of casinos owned | 4 |
Number of casinos located within a hotel owned by a third party | 1 |
ORGANIZATION - Cash Equivalents
ORGANIZATION - Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Cash and equivalents | $ 28,851 | $ 20,634 | |
Restricted cash | 1,000 | 0 | |
Total cash, cash equivalents and restricted cash | $ 29,851 | $ 20,634 | $ 19,910 |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of estimated useful lives (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Minimum | Land improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 15 years |
Minimum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 3 years |
Minimum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 2 years |
Maximum | Land improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 18 years |
Maximum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 44 years |
Maximum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment useful life | 10 years |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Leases (Details) | Dec. 31, 2019 |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Lease, Practical Expedient, Lessor Single Lease Component [true false] | true |
BASIS OF PRESENTATION AND SUM_5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2019USD ($)item | Sep. 30, 2019USD ($) | Jun. 30, 2020item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Basis Of Presentation [Line Items] | |||||
Advertising costs included in selling, general and administrative expenses | $ | $ 4,200 | $ 3,800 | |||
Customer Loyalty Programs | |||||
Basis Of Presentation [Line Items] | |||||
Liabilities Based On Standalone Retail Value Included In Other Accrued Expenses | $ | $ 1,400 | 1,400 | $ 1,400 | ||
Sports Wagering Agreements | |||||
Basis Of Presentation [Line Items] | |||||
Revenue recognition term | 10 years | ||||
Deferred revenues | $ | $ 5,990 | $ 6,000 | $ 5,990 | ||
Sports Wagering Agreements | INDIANA | |||||
Basis Of Presentation [Line Items] | |||||
Number of contracted mobile sports operators in operations | item | 1 | ||||
Number of contracted mobile sports operators | item | 3 | ||||
Number of contracted mobile sports operators expected to begin | item | 2 |
BASIS OF PRESENTATION AND SUM_6
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Earnings (Loss) Per Share (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Net loss - basic | $ (5,822) | $ (4,371) |
Adjustment for assumed conversion of warrants | (1,671) | |
Net loss - diluted | $ (5,822) | $ (6,042) |
Weighted-average common share equivalents - basic (in shares) | 26,979,829 | 26,012,381 |
Potential dilution from assumed conversion of warrants (in shares) | 449,000 | |
Weighted-average common and common share equivalents - diluted (in shares) | 26,979,829 | 26,460,902 |
Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share (in shares) | 3,851,000 | 2,576,000 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 189,558 | $ 182,330 |
Less: Accumulated depreciation | (68,071) | (60,254) |
Property and equipment, net of accumulated depreciation and amortization | 121,487 | 122,076 |
Land and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 16,144 | 16,002 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 114,672 | 114,001 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 47,886 | 45,463 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 10,856 | $ 6,864 |
PROPERTY AND EQUIPMENT, NET - L
PROPERTY AND EQUIPMENT, NET - Leased property and equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 189,558 | $ 182,330 |
Less: Accumulated depreciation | (68,071) | (60,254) |
Property and equipment, net of accumulated depreciation and amortization | 121,487 | 122,076 |
Finance Leased Asset [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 7,726 | 7,726 |
Less: Accumulated depreciation | (2,689) | (2,531) |
Property and equipment, net of accumulated depreciation and amortization | 5,037 | 5,195 |
Leased Land And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 215 | 215 |
Leased Buildings And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 5,787 | 5,787 |
Leased Furniture And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,724 | $ 1,724 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill and Other Intangibles [Line Items] | ||
Gross Carrying Value | $ 26,933 | $ 26,933 |
Accumulated Impairments | (5,647) | (5,647) |
Goodwill | 21,286 | 21,286 |
Silver Slipper Casino and Hotel | ||
Goodwill and Other Intangibles [Line Items] | ||
Gross Carrying Value | 14,671 | 14,671 |
Accumulated Impairments | 0 | 0 |
Goodwill | 14,671 | 14,671 |
Rising Star Casino Resort | ||
Goodwill and Other Intangibles [Line Items] | ||
Gross Carrying Value | 1,647 | 1,647 |
Accumulated Impairments | (1,647) | (1,647) |
Goodwill | 0 | |
Bronco Billy's Casino and Hotel | ||
Goodwill and Other Intangibles [Line Items] | ||
Gross Carrying Value | 4,806 | 4,806 |
Accumulated Impairments | 0 | 0 |
Goodwill | 4,806 | 4,806 |
Northern Nevada Casinos | ||
Goodwill and Other Intangibles [Line Items] | ||
Gross Carrying Value | 5,809 | 5,809 |
Accumulated Impairments | (4,000) | (4,000) |
Goodwill | $ 1,809 | $ 1,809 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLES - Other Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Amortizing intangible assets: | ||
Accumulated Amortization | $ (7,913,000) | $ (7,819,000) |
Finite-Lived Intangible Assets, Net, Total | 1,296,000 | |
Intangible assets, net (excluding goodwill) [Abstract] | ||
Intangible Assets, Gross Carrying Value | 29,172,000 | 29,167,000 |
Intangible Assets, Accumulated Impairments, Net | (10,203,000) | (10,203,000) |
Other Intangible Asset, Net | 11,056,000 | 11,145,000 |
Goodwill and intangible asset impairment | 0 | 0 |
Gaming Licenses | ||
Non-amortizing intangible assets: | ||
Gross Carrying Value | 18,046,000 | 18,046,000 |
Accumulated Impairments, Net | (10,203,000) | (10,203,000) |
Other Intangible Assets, Net | 7,843,000 | 7,843,000 |
Trade names | ||
Non-amortizing intangible assets: | ||
Gross Carrying Value | 1,800,000 | 1,800,000 |
Accumulated Impairments, Net | 0 | 0 |
Other Intangible Assets, Net | 1,800,000 | 1,800,000 |
Trademarks | ||
Non-amortizing intangible assets: | ||
Gross Carrying Value | 116,000 | 111,000 |
Accumulated Impairments, Net | 0 | 0 |
Other Intangible Assets, Net | $ 116,000 | $ 111,000 |
Customer Loyalty Programs | ||
Amortizing intangible assets: | ||
Estimated Life (Years) | 3 years | 3 years |
Gross Carrying Value | $ 7,600,000 | $ 7,600,000 |
Accumulated Amortization | (7,600,000) | (7,600,000) |
Finite-Lived Intangible Assets, Net, Total | $ 0 | $ 0 |
Land Lease and Water Rights | ||
Amortizing intangible assets: | ||
Estimated Life (Years) | 46 years | 46 years |
Gross Carrying Value | $ 1,420,000 | $ 1,420,000 |
Accumulated Amortization | (226,000) | (195,000) |
Finite-Lived Intangible Assets, Net, Total | $ 1,194,000 | $ 1,225,000 |
Casino Lease Option | ||
Amortizing intangible assets: | ||
Estimated Life (Years) | 3 years | 3 years |
Gross Carrying Value | $ 190,000 | $ 190,000 |
Accumulated Amortization | (87,000) | (24,000) |
Finite-Lived Intangible Assets, Net, Total | $ 103,000 | $ 166,000 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLES - Customer Loyalty Programs (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets accumulated amortization | $ 7,913 | $ 7,819 |
Customer Loyalty Programs | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Value of intangible assets | 7,600 | 7,600 |
Intangible assets accumulated amortization | 7,600 | $ 7,600 |
Silver Slipper Casino and Hotel | Customer Loyalty Programs | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Value of intangible assets | 5,900 | |
Rising Star Casino Resort | Customer Loyalty Programs | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Value of intangible assets | $ 1,700 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLES - Land Lease and Water Rights (Details) - Silver Slipper Casino and Hotel - Cure Land Company, LLC - Land Lease and Water Rights $ in Thousands | Dec. 31, 2019USD ($) |
Goodwill and Other Intangibles [Line Items] | |
Excess fair value of land over estimated net present value of land lease payments | $ 970 |
Fair value of water rights based on current market rate | $ 450 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLES - Trade Names (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Bronco Billy's Casino and Hotel | Trade names | |
Indefinite-lived Intangible Assets [Line Items] | |
Period of existence (approximately) | 26 years |
GOODWILL AND OTHER INTANGIBLE_7
GOODWILL AND OTHER INTANGIBLES - Current & Future Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 94 | $ 56 |
2020 | 94 | |
2021 | 70 | |
2022 | 31 | |
2023 | 31 | |
2024 | 31 | |
Thereafter | 1,039 | |
Finite-Lived Intangible Assets, Net, Total | $ 1,296 |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Player club points and progressive jackpots | $ 3,281 | |
Real estate and personal property taxes | 1,730 | |
Gaming and other taxes | 2,082 | |
Other gaming-related accruals | 1,299 | |
Accrued rent | 422 | |
Current portion of deferred revenue | 100 | |
Other | 1,699 | |
Accrued Liabilities, Current, Total | $ 10,613 | |
Balances without Adoption of ASC 606 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Player club points and progressive jackpots | $ 3,389 | |
Real estate and personal property taxes | 1,614 | |
Gaming and other taxes | 2,028 | |
Other gaming-related accruals | 1,112 | |
Accrued rent | 604 | |
Other | 957 | |
Accrued Liabilities, Current, Total | $ 9,704 |
LONG-TERM DEBT AND COMMON STO_3
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Senior Secured Notes Narrative (Details) - USD ($) | May 09, 2019 | Feb. 02, 2018 | May 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | May 10, 2019 |
Line of Credit Facility [Line Items] | |||||||
Outstanding principal | $ 107,925,000 | $ 107,925,000 | $ 99,000,000 | ||||
Gain (Loss) on Extinguishment of Debt | 0 | $ (2,673,000) | |||||
Senior Secured Notes | |||||||
Line of Credit Facility [Line Items] | |||||||
Outstanding principal | 107,925,000 | $ 107,925,000 | |||||
Term Loan | Line of Credit | |||||||
Line of Credit Facility [Line Items] | |||||||
Gain (Loss) on Extinguishment of Debt | $ 2,700,000 | ||||||
Term Loan | First Lien Credit Facility | Line of Credit | |||||||
Line of Credit Facility [Line Items] | |||||||
Outstanding principal | 41,000,000 | ||||||
Term Loan | Second Lien Credit Agreement | Line of Credit | |||||||
Line of Credit Facility [Line Items] | |||||||
Outstanding principal | 55,000,000 | ||||||
Senior Secured Notes Due 2024 | Senior Secured Notes | |||||||
Line of Credit Facility [Line Items] | |||||||
Face amount of senior secured notes | $ 100,000,000 | $ 10,000,000 | |||||
Issue price, percentage | 99.01% | 98.00% | |||||
Discount percentage | 0.99% | 2.00% | |||||
Outstanding principal | $ 100,000,000 | ||||||
Periodic payment of principal | $ 250,000 | $ 275,000 | |||||
Balloon payment to be paid | $ 103,500,000 | ||||||
Senior Secured Notes Due 2024 | Senior Secured Notes | LIBOR | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable rate floor | 1.00% | ||||||
Applicable margin rate | 7.00% |
LONG-TERM DEBT AND COMMON STO_4
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Redemption of Senior Secured Notes (Details) - Senior Secured Notes - Senior Secured Notes Due 2024 | 12 Months Ended |
Dec. 31, 2019 | |
On February 2, 2019 to February 1, 2020 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 2.00% |
On February 2, 2020 to February 1, 2021 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 1.50% |
On February 2, 2021 to February 1, 2022 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 0.50% |
On or after February 2, 2022 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 0.00% |
LONG-TERM DEBT AND COMMON STO_5
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Prior Credit Facilities Narrative (Details) - Line of Credit | May 13, 2016 | Dec. 31, 2017 |
Capital One Bank | First Lien Credit Facility | ||
Debt Instrument [Line Items] | ||
Minimum base rate | 1.00% | |
Applicable margin rate | 4.25% | |
Term Loan | Abc Funding LLC | Second Lien Credit Agreement | ||
Debt Instrument [Line Items] | ||
Interest rate | 13.50% | |
Prepayment penalty | 2.00% |
LONG-TERM DEBT AND COMMON STO_6
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Feb. 02, 2018 |
Debt Instrument [Line Items] | |||
Outstanding principal | $ 107,925 | $ 99,000 | |
Unamortized discounts and debt issuance costs | (3,902) | (3,806) | |
Long-term debt, net | 104,023 | 95,194 | |
Current portion of long-term debt | (1,100) | (1,000) | |
Long-term debt, net of current portion, unamortized discount and issuance costs | 102,923 | $ 94,194 | |
Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Outstanding principal | $ 107,925 | ||
Senior Secured Notes Due 2024 | Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Outstanding principal | $ 100,000 |
LONG-TERM DEBT AND COMMON STO_7
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Scheduled Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Outstanding Principal | $ 107,925 | $ 99,000 |
Senior Secured Notes | ||
Debt Instrument [Line Items] | ||
2020 | 1,100 | |
2021 | 1,100 | |
2022 | 1,100 | |
2023 | 1,100 | |
2024 | 103,525 | |
Outstanding Principal | $ 107,925 |
LONG-TERM DEBT AND COMMON STO_8
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Covenants (Details) - Senior Secured Notes Due 2024 $ in Millions | Dec. 31, 2019USD ($) |
December 31, 2019 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 6 |
March 31, 2020 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 6 |
June 30, 2020 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.75 |
September 30, 2020 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.75 |
December 31, 2020 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.50 |
March 31, 2021 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.50 |
June 30, 2021 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.25 |
September 30, 2021 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5.25 |
December 31, 2021 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 5 |
March 31, 2022 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 4.75 |
June 30, 2022 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 4.75 |
September 30, 2022 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 4.75 |
December 31, 2022 | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 4.75 |
March 31, 2023 and the last day of each fiscal quarter thereafter | |
Line of Credit Facility [Line Items] | |
Total leverage covenant ratio | 4.50 |
Senior Secured Notes | |
Line of Credit Facility [Line Items] | |
Cash and cash equivalents, allowed to deduct from adjusted EBITDA to debt ratio | $ 15 |
LONG-TERM DEBT AND COMMON STO_9
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Interest Rate Cap Agreement Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Apr. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |||
Payments for Derivative Instrument, Financing Activities | $ 238 | $ 0 | $ 238 |
Notional amount | $ 50,000 | ||
Cap interest rate | 3.00% | ||
Derivative term | 3 months |
LONG-TERM DEBT AND COMMON ST_10
LONG-TERM DEBT AND COMMON STOCK WARRANT LIABILITY - Common Stock Warrant Liability (Details) $ / shares in Units, $ in Thousands | May 13, 2016$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Class of Warrant or Right [Line Items] | ||||
Expected contractual term | 6 years 4 months 13 days | 7 years 4 months 13 days | ||
Fair Value Adjustment of Warrants | $ 1,230 | $ (1,671) | ||
Price volatility rate | ||||
Class of Warrant or Right [Line Items] | ||||
Expected stock rate | 0.4687 | 0.4326 | ||
Expected dividend rate | ||||
Class of Warrant or Right [Line Items] | ||||
Expected stock rate | 0 | 0 | ||
Risk free interest rate | ||||
Class of Warrant or Right [Line Items] | ||||
Expected stock rate | 0.0179 | 0.0264 | ||
Line of Credit | Second Lien Credit Agreement | Warrant to Purchase Common Equity | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants issued (in shares) | shares | 1,006,568 | |||
Warrant exercise price (in dollars per share) | $ / shares | $ 1.67 | |||
Warrants, period for measuring warrant exercise price | 60 days | |||
Warrants, period for mandatory registration rights | 2 years | |||
Period for measuring repurchase value | 21 days | |||
Fair Value Adjustment of Warrants | $ (1,200) | $ 1,700 | ||
Unsecured Debt | Second Lien Credit Agreement | Warrant to Purchase Common Equity | ||||
Class of Warrant or Right [Line Items] | ||||
Term of unsecured note | 4 years | |||
Interest rate on unsecured note | 13.25% |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Jan. 01, 2018USD ($) | Jun. 30, 2017USD ($)ft² | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($)roomOptionlease | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2004USD ($)a | Sep. 30, 2017 | Dec. 31, 2019USD ($)room | Sep. 30, 2027USD ($) | Nov. 30, 2018USD ($) | Mar. 16, 2016USD ($) |
Lessee, Lease, Description [Line Items] | |||||||||||||||
Number of finance leases | lease | 1 | ||||||||||||||
Operating leases | $ 3,920,000 | ||||||||||||||
Total leased land | a | 38 | ||||||||||||||
Future minimum lease payments | $ 48,996,000 | $ 48,996,000 | |||||||||||||
Lease term of contract | 3 years 6 months | 3 years 6 months | |||||||||||||
Grand Lodge Casino Facility | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Operating leases | $ 1,900,000 | ||||||||||||||
Rent | $ 166,667 | $ 145,833 | |||||||||||||
Rent expenses of operating lease | $ 2,000,000 | ||||||||||||||
Lessor acquisition price, EBITDA measurement period | 12 months | ||||||||||||||
Corporate Office Lease | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Rent | $ 200,000 | ||||||||||||||
Office lease, square feet | ft² | 4,479 | ||||||||||||||
Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Cost to exercise purchase option | $ 7,600,000 | $ 7,600,000 | |||||||||||||
Number of original renewal options | Option | 6 | ||||||||||||||
Land, buildings and improvements | Various Buildings And Land In Cripple Creak, Colorado | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Cost to exercise purchase option | $ 2,600,000 | 2,600,000 | |||||||||||||
Annual increase to purchase price option | 100,000 | 100,000 | |||||||||||||
Maximum purchase price on purchase option | 2,800,000 | $ 2,800,000 | |||||||||||||
Land lease | Land Lease Of Silver Slipper Casino Site | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Percentage of gross gaming revenue | 3.00% | ||||||||||||||
Gross gaming revenue (in excess of) | $ 3,650,000 | ||||||||||||||
Operating leases | 1,600,000 | ||||||||||||||
Contingent rental expense | $ 600,000 | 600,000 | |||||||||||||
Rent | 77,500 | ||||||||||||||
Rent expenses of operating lease | $ 1,500,000 | ||||||||||||||
Cost to exercise purchase option | $ 15,500,000 | ||||||||||||||
Retained interest in percentages of net income | 3.00% | ||||||||||||||
Retained interest in percentages of net income, term | 10 years | ||||||||||||||
New purchase price if change in ownership of Silver Slipper | $ 17,100,000 | ||||||||||||||
Value of option to purchase four acre portion of land | $ 2,000,000 | ||||||||||||||
Land lease | Land Lease Of Silver Slipper Casino Site | Marshland | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Area of land subject to ground lease | a | 31 | ||||||||||||||
Land lease | Land Lease Of Silver Slipper Casino Site | Parcel | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Area of land subject to ground lease | a | 7 | ||||||||||||||
Land in purchase option (in acres) | a | 4 | ||||||||||||||
Lease Terms, Option One | Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease extension term | 3 years | 3 years | |||||||||||||
Lease Terms, Option One | Land, buildings and improvements | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lessee Leasing Arrangements Operating Leases Annual Rent Expense | $ 200,000 | ||||||||||||||
Lease Terms, Option One | Land, buildings and improvements | Various Buildings And Land In Cripple Creak, Colorado | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lessee, Operating Lease, Term of Contract | 3 years | 3 years | |||||||||||||
Lease Terms, Option Two | Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease includes base payments | $ 30,000 | ||||||||||||||
Lease Terms, Option Two | Land, buildings and improvements | Various Buildings And Land In Cripple Creak, Colorado | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease extension term | 2 years | 2 years | |||||||||||||
Annual lease payments | $ 300,000 | ||||||||||||||
Lease Terms, Second Renewal Option | Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease includes base payments | $ 32,500 | ||||||||||||||
Rising Star Casino Resort | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Capital expenditure requirement, landlord improvements | $ 1,000,000 | ||||||||||||||
Rising Star Casino Resort | Rising Sun/Ohio County First, Inc | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Number of hotel rooms | room | 104 | 104 | |||||||||||||
Project actual cost | $ 7,700,000 | $ 7,700,000 | |||||||||||||
Capital lease monthly payment | $ 57,537 | $ 56,537 | $ 48,537 | ||||||||||||
Option price | 4,300,000 | $ 4,300,000 | |||||||||||||
Annual Interest Rate | 3.50% | 4.50% | |||||||||||||
Option price at lease maturity | $ 1 | ||||||||||||||
Minimum | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease terms | 1 month | ||||||||||||||
Maximum | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Lease terms | 38 years | ||||||||||||||
Scenario, Forecast | Rising Star Casino Resort | Rising Sun/Ohio County First, Inc | |||||||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||||||
Capital lease monthly payment | $ 63,537 | $ 54,326 |
LEASES - Balance Sheet Details
LEASES - Balance Sheet Details (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
LEASES | |||
Operating lease assets | [1] | $ 19,171 | $ 0 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Operating lease assets | ||
Finance lease assets | $ 5,037 | ||
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net | ||
Total lease assets | $ 24,208 | ||
Current operating lease liability | [1] | $ 2,707 | 0 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current operating lease liability | ||
Current finance lease liability | $ 448 | $ 497 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current finance lease liability | ||
Noncurrent operating lease liability | $ 16,706 | ||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | fll:OperatingLeaseObligationNetOfCurrentPortionAndOther | ||
Noncurrent finance lease liability | $ 3,829 | ||
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Noncurrent finance lease liability | ||
Total lease liabilities | $ 23,690 | ||
Finance lease, right-of-use asset, accumulated depreciation | $ 2,700 | ||
[1] | On January 1, 2019, the Company adopted Accounting Standards Codification 842 (“ASC 842”), using the modified retrospective transition method under the effective date approach, which impacts the comparability of these line items. |
LEASES - Lease Expense (Details
LEASES - Lease Expense (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
LEASES | |
Fixed/base rent | $ 3,920 |
Variable payments | 788 |
Amortization of leased assets | 158 |
Interest on lease liabilities | 206 |
Total lease costs | $ 5,072 |
LEASES - Maturities of Lease Li
LEASES - Maturities of Lease Liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($)room | Dec. 31, 2018USD ($) | |
Operating Leases | |||
2020 | $ 4,815 | ||
2021 | 4,684 | ||
2022 | 4,468 | ||
2023 | 2,876 | ||
2024 | 1,135 | ||
Thereafter | 31,018 | ||
Total future minimum lease payments | 48,996 | ||
Less: Amount representing interest | (28,186) | ||
Present value of lease liabilities | 20,810 | ||
Current operating lease liability | [1] | (2,707) | $ 0 |
Noncurrent operating lease liability | 16,706 | ||
Noncurrent operating lease liability | 18,103 | ||
Financing Lease | |||
2020 | 616 | ||
2021 | 652 | ||
2022 | 652 | ||
2023 | 652 | ||
2024 | 652 | ||
Thereafter | 1,847 | ||
Total future minimum lease payments | 5,071 | ||
Less: Amount representing interest | (794) | ||
Present value of lease liabilities | 4,277 | ||
Current finance lease liability | (448) | $ (497) | |
Noncurrent finance lease liability | 3,829 | ||
Present value of lease payments over the lease term | $ 1,400 | ||
Lease term of contract | 3 years 6 months | ||
Rising Star Casino Resort | Rising Sun/Ohio County First, Inc | |||
Financing Lease | |||
Number of hotel rooms | room | 104 | ||
[1] | On January 1, 2019, the Company adopted Accounting Standards Codification 842 (“ASC 842”), using the modified retrospective transition method under the effective date approach, which impacts the comparability of these line items. |
LEASES - Lease Term and Discoun
LEASES - Lease Term and Discount Rate (Details) | Dec. 31, 2019 |
LEASES | |
Weighted-average remaining lease term, operating leases | 20 years 2 months 12 days |
Weighted-average remaining lease term, finance leases | 7 years 9 months 18 days |
Weighted-average discount rate, operating leases | 9.40% |
Weighted-average discount rate, finance leases | 4.50% |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows for operating leases | $ 3,933 |
Operating cash flows for finance lease | 206 |
Financing cash flows for finance lease | $ 544 |
INCOME TAXES - Income tax provi
INCOME TAXES - Income tax provision (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Current: | ||
Federal | $ 0 | $ 0 |
State | 0 | 0 |
Total current tax | 0 | 0 |
Deferred: | ||
Federal | (1,016) | (587) |
State | (743) | (651) |
Increase (decrease) in valuation allowance | 1,839 | 1,714 |
Total deferred tax | 80 | 476 |
Income Tax Expense (Benefit), Total | $ 80 | $ 476 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of income tax provision relative to continuing operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Federal income tax benefit at U.S. statutory rate | 21.00% | 21.00% |
State taxes, net of federal benefit | 10.20% | 13.20% |
Change in valuation allowance, exclusive of Tax Reform impact | (32.00%) | (44.00%) |
Permanent differences | (3.70%) | (6.30%) |
Credits | 2.70% | 3.70% |
Other | 0.40% | 0.20% |
Effective Income Tax Rate Reconciliation, Percent, Total | (1.40%) | (12.20%) |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Federal income tax benefit at U.S. statutory rate | $ (1,208) | $ (817) |
State taxes, net of federal benefit | (587) | (515) |
Change in valuation allowance, exclusive of Tax Reform impact | 1,839 | 1,714 |
Permanent differences | 215 | 247 |
Credits | (156) | (146) |
Other | (23) | (7) |
Income Tax Expense (Benefit), Total | $ 80 | $ 476 |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets (liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets | ||
Deferred compensation | $ 591 | $ 744 |
Intangible assets and amortization | 3,761 | 4,023 |
Net operating loss carry-forwards | 7,834 | 6,210 |
Accrued expenses | 853 | 975 |
Allowance for doubtful accounts | 32 | 22 |
Credits | 668 | 481 |
Common stock warrant liability | 402 | 69 |
Loan Fees | 129 | 0 |
Interest valuation | 65 | 40 |
Interest limitation | 1,712 | 1,362 |
Lease liabilities | 4,345 | 0 |
Charitable contribution carry-forward | 125 | 97 |
Valuation allowance | (10,964) | (9,125) |
Total deferred tax assets | 9,553 | 4,898 |
Deferred tax liabilities: | ||
Depreciation of fixed assets | (1,711) | (1,939) |
Amortization of indefinite-lived intangibles | (2,803) | (2,232) |
Prepaid expenses | (656) | (710) |
Effect of state taxes on future federal returns | (785) | (629) |
Right of use assets | (4,282) | 0 |
Other | (28) | (20) |
Total deferred tax liabilities | (10,265) | (5,530) |
Total deferred tax assets (liabilities) | $ (712) | $ (632) |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Loss Carryforwards [Line Items] | ||
Federal income tax benefit at U.S. statutory rate | 21.00% | 21.00% |
Deferred tax liabilities relating to the net operating loss | $ 2,803 | $ 2,232 |
Deferred tax liabilities, goodwill and indefinite lived intangible assets | 700 | 600 |
Indefinite lived deferred tax liabilities netted against deferred tax assets and net operating loss carryforwards | 1,600 | |
Valuation allowance from effect of Tax Cuts and Jobs Ac | 1,600 | |
Decrease in Deferred Tax Liability due to Transition Tax | $ 1,600 | |
General Business Tax Credit Carryforward | ||
Operating Loss Carryforwards [Line Items] | ||
General business credit carry-forward | 700 | |
Domestic Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carry-forwards | 22,100 | |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carry-forwards | 56,200 | |
Tax Year 2019 to 2035 | Domestic Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carry-forwards | 14,000 | |
Tax Year 2019 to 2035 | State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carry-forwards | $ 55,900 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Options to Purchase or Lease Land and Buildings (Details) | 1 Months Ended | ||
Jul. 31, 2019USD ($) | Jul. 31, 2018USD ($)a | Dec. 31, 2019USD ($) | |
Various Buildings And Land In Cripple Creak, Colorado | Land, buildings and improvements | |||
Other Commitments [Line Items] | |||
Annual increase to purchase price option | $ 100,000 | ||
Maximum purchase price on purchase option | 2,800,000 | ||
Cost to exercise purchase option | $ 2,600,000 | ||
La Posada del Llano Racetrack | |||
Other Commitments [Line Items] | |||
Cost to purchase options | $ 125,000 | ||
Land in purchase option (in acres) | a | 520 | ||
Payments To Renew Land Purchase Options | $ 125,000 | ||
La Posada del Llano Racetrack | Option To Purchase, Option One | |||
Other Commitments [Line Items] | |||
Cost to purchase options | $ 75,000 | ||
Land in purchase option (in acres) | a | 200 | ||
Period following granting of license award | 60 days | ||
Extension period (in years) | 1 year | ||
Extension option costs | $ 75,000 | ||
La Posada del Llano Racetrack | Option To Purchase, Option One Extension | |||
Other Commitments [Line Items] | |||
Extension period (in years) | 1 year | ||
Extension option costs | $ 75,000 | ||
Cost to exercise purchase option | $ 1,400,000 | ||
La Posada del Llano Racetrack | Option To Purchase, Option Two | |||
Other Commitments [Line Items] | |||
Cost to purchase options | $ 50,000 | ||
Land in purchase option (in acres) | a | 320 | ||
Period following granting of license award | 60 years | ||
La Posada del Llano Racetrack | Option To Purchase, Option Two Extension | |||
Other Commitments [Line Items] | |||
Extension period (in years) | 1 year | ||
Extension option costs | $ 50,000 | ||
Cost to exercise purchase option | $ 1,600,000 |
COMMITMENTS AND CONTINGENCIES C
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES - Defined Contribution Pension Plan (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Matching contributions and certain other benefits | $ 0.3 | $ 0.3 |
Percentage of additional employer matching contribution | 50.00% | 50.00% |
Percentage of annual contributions per employee | 4.00% | 4.00% |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | |
Equity [Abstract] | ||
Equity offering, net (in shares) | 3,943,333 | |
Subscription price (in USD per share) | $ 3 | |
Gross proceeds from issuance of common stock | $ 11,800 | |
Net proceeds from issuance of common stock | $ 11,400 | $ 11,436 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 30, 2015 | Nov. 28, 2014 | Sep. 30, 2019 | May 31, 2019 | May 31, 2018 | May 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2017 | May 05, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period of remaining shares | 4 years | |||||||||
Stock compensation expense | $ 0.3 | $ 0.6 | ||||||||
Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 0.94 | $ 1.34 | ||||||||
Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | 12,667 | |||||||||
Number of stock options granted (in shares) | 436,900 | |||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 2.06 | |||||||||
Unrecognized compensation cost | $ 0.5 | |||||||||
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years 1 month 6 days | |||||||||
Chief Executive Officer | Daniel R. Lee | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 943,834 | |||||||||
Chief Financial Officer | Lewis Fanger [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 300,000 | |||||||||
2015 Equity Incentive Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares authorized for issuance | 2,500,000 | 1,400,000 | ||||||||
Award terms | 10 years | |||||||||
Number of shares available for future issuance (in shares) | 489,635 | |||||||||
2015 Equity Incentive Plan | Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 260,000 | |||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 1.97 | |||||||||
Vesting period of remaining shares | 3 years | |||||||||
2015 Equity Incentive Plan | Chief Executive Officer | Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 240,000 | |||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 2.32 | |||||||||
2015 Equity Incentive Plan | Director | Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 51,900 | |||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 2.23 | |||||||||
Vesting period of remaining shares | 1 year | |||||||||
Issuance of share based compensation (in shares) | 21,524 | |||||||||
2015 Equity Incentive Plan | Chief Financial Officer | Stock options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options granted (in shares) | 100,000 | |||||||||
Weighted average value per share of stock option grants (in USD per share) | $ 2.23 | |||||||||
Vesting period of remaining shares | 3 years |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summarizes information related to our common stock options (Details) | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Weighted Average Exercise Price | |
Weighted Average Remaining Contractual Term | 6 years 5 months 1 day |
Aggregate Intrinsic Value, Options exercised | $ | $ 4,667,998 |
Weighted Average Remaining Contractual Term, Options Exercisable | 5 years 7 months 24 days |
Aggregate Intrinsic Value, Options exercisable | $ | $ 3,910,111 |
Stock options | |
Number of Stock Options | |
Options outstanding, beginning balance (in shares) | shares | 2,575,774 |
Granted (in shares) | shares | 436,900 |
Exercised (in shares) | shares | (122,269) |
Canceled/Forfeited (in shares) | shares | (33,333) |
Options outstanding, ending balance (in shares) | shares | 2,844,405 |
Options exercisable (in shares) | shares | 2,181,671 |
Weighted Average Exercise Price | |
Weighted average exercise price, Options outstanding (in dollars per share) | $ 1.67 |
Granted (in dollars per share) | 2.06 |
Exercised (in dollars per share) | 1.84 |
Canceled/Forfeited (in dollars per share) | 2.07 |
Expired (in dollars per share) | 2.81 |
Weighted average exercise price, Options outstanding (in dollars per share) | 1.71 |
Weighted average exercise price, Options exercisable (in dollars per share) | $ 1.56 |
SHARE-BASED COMPENSATION - Opti
SHARE-BASED COMPENSATION - Option valuation assumptions for options granted (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Expected volatility | 46.17% | 43.33% |
Expected dividend yield | 0.00% | 0.00% |
Expected life (in years) | 5 years 11 months 9 days | 5 years 10 months 10 days |
Weighted average risk free rate | 1.87% | 2.93% |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deposits and other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate cap | $ 0 | |
Common stock warrants | $ 92 | |
Deposits and other assets | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate cap | 0 | 0 |
Deposits and other assets | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate cap | 0 | 92 |
Deposits and other assets | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate cap | 0 | 0 |
Common stock warrant liability | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrants | 2,055 | 825 |
Common stock warrant liability | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrants | 0 | |
Common stock warrant liability | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrants | 0 | |
Common stock warrant liability | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrants | $ 2,055 | $ 825 |
SEGMENT REPORTING AND DISAGGR_3
SEGMENT REPORTING AND DISAGGREGATED REVENUE - Selected Statement of Operations Data (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of segments | segment | 4 | |
Net Revenues | $ 165,432 | $ 163,887 |
Adjusted Property EBITDA | 20,650 | 22,226 |
Depreciation and amortization | (8,331) | (8,397) |
Corporate expenses | (4,710) | (4,575) |
Preopening costs | (274) | |
Project development and acquisition costs | (1,037) | (843) |
Loss on sale or disposal of assets, net | (8) | (79) |
Share-based compensation | (348) | (632) |
Operating income | 6,216 | 7,426 |
Other (expense) income: | ||
Interest expense, net | (10,728) | (10,306) |
Loss on extinguishment of debt | 0 | (2,673) |
Adjustment to fair value of warrants | 1,230 | (1,671) |
Nonoperating Income (Expense) | (11,958) | (11,321) |
Income (loss) before income taxes | (5,742) | (3,895) |
Income tax expense | 80 | 476 |
Net loss | (5,822) | (4,371) |
Silver Slipper Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 73,201 | 69,350 |
Adjusted Property EBITDA | 13,159 | 12,126 |
Rising Star Casino Resort | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 45,620 | 47,966 |
Adjusted Property EBITDA | 1,330 | 2,806 |
Bronco Billy's Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 27,507 | 26,942 |
Adjusted Property EBITDA | 3,000 | 3,919 |
Northern Nevada Casinos | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 19,104 | 19,629 |
Adjusted Property EBITDA | 3,161 | 3,375 |
Casino | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 113,390 | 114,324 |
Food and beverage | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | 35,069 | 35,058 |
Other operations | ||
Segment Reporting Information [Line Items] | ||
Net Revenues | $ 5,438 | $ 4,641 |
SEGMENT REPORTING AND DISAGGR_4
SEGMENT REPORTING AND DISAGGREGATED REVENUE - Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Total Assets | $ 211,335 | $ 182,272 |
Property, Plant and Equipment, Net | 121,487 | 122,076 |
Operating Segments | Silver Slipper Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 87,980 | 79,094 |
Property, Plant and Equipment, Net | 55,127 | 56,369 |
Operating Segments | Rising Star Casino Resort | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 40,277 | 39,722 |
Property, Plant and Equipment, Net | 32,824 | 33,700 |
Operating Segments | Bronco Billy's Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 45,034 | 42,780 |
Property, Plant and Equipment, Net | 25,164 | 23,354 |
Operating Segments | Northern Nevada Casinos | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 18,612 | 12,395 |
Property, Plant and Equipment, Net | 7,297 | 7,434 |
Corporate and Other | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 19,432 | 8,281 |
Property, Plant and Equipment, Net | $ 1,075 | $ 1,219 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Subsequent Events [Abstract] | ||
Cash and Cash Equivalents, at Carrying Value | $ 28,851 | $ 20,634 |
Restricted Cash, Current | $ 1,000 | $ 0 |