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What changed in FULL HOUSE RESORTS INC's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of FULL HOUSE RESORTS INC's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+328 added−350 removedSource: 10-K (2024-03-15) vs 10-K (2023-03-16)

Top changes in FULL HOUSE RESORTS INC's 2023 10-K

328 paragraphs added · 350 removed · 134 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

47 edited+12 added−27 removed23 unchanged
Biggest changeThe following table presents selected information concerning our casino resort properties as of December 31, 2022: ​ ​ ​ Segments and Properties ​ Locations Colorado ​ ​ Bronco Billy’s Casino and Hotel Cripple Creek, CO (near Colorado Springs) Chamonix Casino Hotel (under construction) ​ Cripple Creek, CO (near Colorado Springs) Illinois ​ ​ The Temporary by American Place (opened on February 17, 2023) and American Place (under development) ​ Waukegan, IL (northern suburb of Chicago) Indiana ​ ​ Rising Star Casino Resort Rising Sun, IN (near Cincinnati) Mississippi ​ ​ Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Nevada ​ ​ Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) Incline Village, NV (North Shore of Lake Tahoe) Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering ​ ​ Three sports wagering websites (“skins”) ​ Colorado Three sports wagering websites (“skins”) ​ Indiana One sports wagering website (“skin”), expected to commence Spring 2023 ​ Illinois ​ We manage our casinos based primarily on geographic regions within the United States and type of income.
Biggest changeThe following table presents selected information concerning our casino resort properties as of December 31, 2023: ​ ​ ​ Segments and Properties ​ Locations Midwest & South ​ ​ American Place * ​ Waukegan, IL (northern suburb of Chicago) Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Rising Star Casino Resort Rising Sun, IN (near Cincinnati) West ​ ​ Bronco Billy’s Casino and Chamonix Casino Hotel * Cripple Creek, CO (near Colorado Springs) Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) Incline Village, NV (North Shore of Lake Tahoe) Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering ​ ​ Three sports wagering websites (“skins”), one of which is currently idle ​ Colorado Three sports wagering websites (“skins”), two of which are currently idle ​ Indiana One sports wagering website (“skin”), commenced in August 2023 ​ Illinois __________ * The temporary American Place facility and Chamonix opened on February 17 and December 27, 2023, respectively.
Item 1. Business. Introduction 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.
Item 1. Business. 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. Introduction 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.
In addition to its casino, Rising Star offers a land-based pavilion with approximately 31,500 square feet of meeting and convention space; a contiguous 190-guest-room hotel; an adjacent, leased 104-guest-room hotel set on three acres; a 56-space RV park; four dining outlets; surface parking; and an 18-hole golf course on over 230 acres.
In addition to its riverboat-based casino, Rising Star offers a land-based pavilion with approximately 31,500 square feet of meeting and convention space; a contiguous 190-guest-room hotel; an adjacent, leased 104-guest-room hotel set on three acres; a 56-space RV park; four dining outlets; surface parking; and an 18-hole golf course on over 230 acres.
One of three riverboat casinos in southeastern Indiana, its closest competitors are each approximately 15 miles away, near bridges crossing the Ohio River. There is no bridge at Rising Star, but in September 2018, we commenced a ferry boat service connecting Rising Sun, Indiana, to the populous Northern Kentucky region.
One of three casinos in southeastern Indiana, its closest competitors in Indiana are each approximately 15 miles away, near bridges crossing the Ohio River. There is no bridge at Rising Star, but in September 2018, we commenced a ferry boat service connecting Rising Sun, Indiana, to the populous Northern Kentucky region.
None of our employees are currently represented by labor unions. ​ Available Information Our principal executive offices are located at Full House Resorts, Inc., One Summerlin, 1980 Festival Plaza Drive, Suite 680, Las Vegas, Nevada 89135, and our telephone number is (702) 221-7800. Our website address is www.fullhouseresorts.com.
None of our employees are currently represented by labor unions. ​ Available Information Our principal executive offices are located at Full House Resorts, Inc., 1980 Festival Plaza Drive, Suite 680, Las Vegas, Nevada 89135, and our telephone number is (702) 221-7800. Our website address is www.fullhouseresorts.com.
Stockman’s also competes with casinos in other rural communities in the area, as well as with casinos in Reno, some of which are significantly larger and offer more amenities. Grand Lodge Casino Grand Lodge is located in Incline Village, Nevada, and is one of four casinos located within a five-mile radius in the North Lake Tahoe area.
Stockman’s also competes with casinos in other rural communities in the area, as well as with casinos in Reno, some of which are significantly larger and offer more amenities. Grand Lodge Casino Grand Lodge is located in Incline Village, Nevada, and is one of three casinos located within a five-mile radius in the North Lake Tahoe area.
Violations of gaming laws in one jurisdiction could result in disciplinary action in other jurisdictions. A summary of the governmental gaming regulations to which we are subject is filed as Exhibit 99.1 and is herein incorporated by reference. 6 Table of Contents Our businesses are also subject to other various federal, state, and local laws and regulations.
Violations of gaming laws in one jurisdiction could result in disciplinary action in other jurisdictions. A summary of the governmental gaming regulations to which we are subject is filed as Exhibit 99.1 and is herein incorporated by reference. Our businesses are also subject to other various federal, state, and local laws and regulations.
Rising Star also competes with a large land-based casino near Louisville; casinos in Ohio and elsewhere in Indiana; and slot parlors associated with racetracks in Kentucky. A significant slot parlor associated with a racetrack opened in Northern Kentucky in September 2022.
Rising Star also competes with a large land-based casino near Louisville; casinos in Ohio (including in downtown Cincinnati) and elsewhere in Indiana; and slot parlors associated with racetracks in Kentucky. A significant slot parlor associated with a racetrack opened in Northern Kentucky in September 2022.
Our customer loyalty programs include the Slipper Rewards Club, the Bronco Billy’s Mile High Rewards Club, the Rising Star VIP Club, the Grand Lodge Players Advantage Club®, the Stockman’s Winner’s Club, and Legacy Rewards.
Our customer loyalty programs include the Slipper Rewards Club, the Bronco Billy’s / Chamonix Mile High Rewards Club, the Rising Star VIP Club, the Grand Lodge Players Advantage Club, the Stockman’s Winner’s Club, and American Place’s Legacy Rewards.
Government Regulation The gaming industry is highly regulated, and we must maintain our licenses and pay gaming taxes to continue our operations. Each of our casinos is subject to extensive regulation under the laws, rules, and regulations of the jurisdiction in which it is located.
We must maintain our licenses and pay gaming taxes to continue our operations. Each of our casinos is subject to extensive regulation under the laws, rules, and regulations of the jurisdiction in which it is located.
Gaming activities with which we compete include traditional commercial casinos and casino resorts in various states, including on tribal lands and at racetracks; state-sponsored lotteries; video poker in restaurants, bars and hotels; pari-mutuel betting on horse and dog racing and jai alai; sports betting; and card rooms.
Gaming activities with which we compete include traditional commercial casinos and casino resorts in various states, including on tribal lands and at racetracks; state-sponsored lotteries; video poker, sports betting, and slot machines in restaurants, bars, sports arenas, and hotels; pari-mutuel betting on horse racing; and card rooms.
Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Material changes, new laws or regulations, or material differences in interpretations by courts or governmental authorities could adversely affect our operating results. See Part I, Item 1A. “ Risk Factors ” for additional discussion.
Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Material changes, new laws or regulations, or material differences in interpretations by courts or governmental authorities could adversely affect our operating results. See Part I, Item 1A.
Failure to comply with applicable laws and regulations could result in costs for corrective action, penalties or the imposition of other liabilities or restrictions. We also are subject to laws and regulations that impose liability and clean-up responsibility for releases of hazardous substances into the environment.
Our Colorado facilities, for example, are in historical mining areas. Failure to comply with applicable laws and regulations could result in costs for corrective action, penalties or the imposition of other liabilities or restrictions. We also are subject to laws and regulations that impose liability and clean-up responsibility for releases of hazardous substances into the environment.
For example, our Indiana property is subject to environmental regulations for its riverboat, ferry boat and golf club operations. Our Mississippi property is located near environmental wetlands. In Colorado and Illinois, we are building major new casino hotels and such construction must also adhere to certain environmental regulations. Our Colorado facilities, for example, are in historical mining areas.
For example, our Indiana property is subject to environmental regulations for its riverboat, ferry boat and golf club operations. Our Mississippi property is located near environmental wetlands. In Colorado and Illinois, we are building, or have recently built, major new casino hotels and such construction must also adhere to certain environmental regulations.
Louisiana law permits 15 riverboat casinos, one land-based casino, four casinos at racetracks, and in certain areas, a limited number of slot machines at qualifying truck stops and off-track betting parlors. The legislation permitting riverboat and truck stop casinos requires a local referendum.
Louisiana law permits 15 riverboat casinos, one land-based casino, four casinos at racetracks, and in certain areas, a limited number of slot machines at qualifying truck stops and off-track betting parlors. The legislation permitting riverboat and truck stop casinos requires a local referendum. At this time, all licenses for riverboat casinos in Louisiana have been granted.
Under these programs, customers earn points based on their volume of wagering that may be redeemed for various benefits, such as “free play,” complimentary dining, and hotel stays. Our properties do not have coordinated loyalty programs, due to the disparate locations of our properties.
Under these programs, customers earn points based on their volume of wagering that may be redeemed for various benefits, such as “free play,” complimentary dining, and hotel stays. Our properties do not have coordinated loyalty programs, due to their disparate locations. Instead, our loyalty programs focus on providing each casino’s customers the amenities they most prefer in each market.
Rather than operate these sports skins ourselves, we contracted with three companies to operate such skins under their own brands in exchange for a percentage of revenues, as defined in each contract, subject to annual minimum amounts paid to us.
Rather than operate these sports skins ourselves, we historically have contracted with outside companies to operate such skins under their own brands in exchange for a percentage of revenues, as defined in each contract, subject to annual minimum amounts paid to us. As of December 31, 2023, two of our three skins were live.
The permanent American Place facility is slated to include a world-class casino with a state-of-the-art sports book; a premium boutique hotel comprised of 20 luxurious villas; a 1,500-seat live entertainment venue; a gourmet restaurant designed to rival the finest restaurants in Chicago; additional eateries and bars; and other amenities that will attract gaming and non-gaming patrons from throughout Chicagoland and beyond. ​ The Temporary and American Place are located on approximately 42 acres of land, consisting of approximately 10 acres of owned land and an adjoining approximately 32 acres that are under a 99-year lease with the City of Waukegan.
The permanent American Place is slated to include a world-class casino with a state-of-the-art sports book, a premium boutique hotel comprised of 20 luxurious villas, assorted eateries and bars, and other amenities designed to attract gaming and non-gaming patrons from throughout Chicagoland and beyond. ​ American Place is located on approximately 42 acres of land, consisting of approximately 10 acres of owned land and an adjoining approximately 32 acres that are under a 99-year lease with the City of Waukegan.
Costs and Effects of Compliance with Environmental Laws We are subject to various federal, state and local environmental laws and regulations that govern our operations, including emissions and discharges into the environment, and the handling and disposal of hazardous and non-hazardous substances and wastes.
“ Risk Factors – Risks Related to our Legal and Regulatory Environment ” for additional discussion. 10 Table of Contents Costs and Effects of Compliance with Environmental Laws We are subject to various federal, state and local environmental laws and regulations that govern our operations, including emissions and discharges into the environment, and the handling and disposal of hazardous and non-hazardous substances and wastes.
The casino resort industry is capital-intensive, and we rely on the ability of our properties to generate operating cash flow to pay interest, repay debt, and fund maintenance and certain growth-related capital expenditures.
We continuously focus on improving the operating results of our existing properties through a combination of revenue growth and expense management efforts. The casino resort industry is capital-intensive, and we rely on the ability of our properties to generate operating cash flow to pay interest, repay debt, and fund maintenance and certain growth-related capital expenditures.
Cripple Creek is one of only three locations in Colorado where commercial gaming is permitted. The other two cities adjoin each other and are approximately one hour west of Denver and two hours from Colorado Springs. Downtown Denver and Colorado Springs are approximately 70 miles apart and certain suburbs of each metropolitan area largely merge into the other.
Cripple Creek is one of only three locations in Colorado where commercial gaming is permitted. The other two locations are in cities that adjoin each other and are approximately one hour west of Denver and two hours from Colorado Springs.
The Company currently operates six casinos: five on real estate that we own or lease and one located within a hotel owned by a third party. Construction continues for a seventh property, Chamonix Casino Hotel (“Chamonix”), adjacent to our existing Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado.
We currently operate seven casinos: six on real estate that we own or lease and one located within a hotel owned by a third party. In December 2023, we began the phased opening of our newest property, Chamonix Casino Hotel (“Chamonix”), located adjacent to our existing Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado.
In addition to its large, modern casino, the Silver Slipper offers 129 hotel rooms or suites, an on-site sportsbook, a fine-dining restaurant, a buffet, a quick-service restaurant, an oyster bar, a casino bar and a beachfront pool and bar. The Silver Slipper currently generates the most revenue and operating income of any of our properties.
In addition to its large, modern casino, the Silver Slipper offers 129 hotel rooms or suites, an on-site sportsbook, a fine-dining restaurant, a buffet, a quick-service restaurant, an oyster bar, a casino bar and a beachfront pool and bar. It also manages a nearby beachfront RV park.
“Financial Statements and Supplementary Data”). We expect to open Chamonix in phases, beginning in the third quarter of 2023. Rising Star Casino Resort (Rising Sun, Indiana) Rising Star is located on the banks of the Ohio River in Rising Sun, Indiana, approximately one hour from Cincinnati, Ohio, and within two hours of Indianapolis, Indiana, and Louisville and Lexington, Kentucky.
Rising Star Casino Resort (Rising Sun, Indiana) Rising Star is located on the banks of the Ohio River in Rising Sun, Indiana, approximately one hour from Cincinnati, Ohio, and within two hours of Indianapolis, Indiana, and Louisville and Lexington, Kentucky.
The landlord currently has an option to purchase our leasehold interest and operating assets of the Grand Lodge Casino at a defined price based partially on earnings.
The landlord currently has an option to purchase our leasehold interest and operating assets of the Grand Lodge Casino at a defined price based partially on earnings. 9 Table of Contents American Place (Waukegan, Illinois) American Place is located in Waukegan, Illinois, a northern suburb of Chicago.
The Hyatt Lake Tahoe is one of three AAA Four Diamond hotels in the Lake Tahoe area. Our casino’s customers consist of both locals and tourists visiting the Lake Tahoe area. 5 Table of Contents Subsequent to year-end, we and our landlord extended our lease through December 31, 2024.
The Hyatt Lake Tahoe is one of three AAA Four Diamond hotels in the Lake Tahoe area. Our casino’s customers consist of both locals and tourists visiting the Lake Tahoe area. Our lease currently expires on December 31, 2024.
Grand Lodge Casino also competes with casinos in South Lake Tahoe and Reno. There are also numerous Native American casinos in California serving the Northern California market.
Grand Lodge is the only casino in Incline Village itself, which is a high-end residential and tourism community. Grand Lodge also competes with casinos in South Lake Tahoe and Reno. Additionally, there are numerous Native American casinos in California serving the Northern California market.
We are currently evaluating whether to operate the idle skin ourselves or find a replacement operator. There is no certainty that we will be able to enter into an agreement with a replacement operator or successfully operate it ourselves. Stockman’s Casino (Fallon, Nevada) Stockman’s is located in Churchill County, Nevada, approximately one hour from Reno, Nevada.
For our two idle skins, we continue to evaluate whether to operate them ourselves or to utilize replacement operators. There is no certainty that we will be able to enter into agreements with replacement operators or successfully operate the skins ourselves. Stockman’s Casino (Fallon, Nevada) Stockman’s is located in Churchill County, Nevada, approximately one hour from Reno, Nevada.
Its customers are primarily from communities in southwestern Mississippi and southern Louisiana, including the North Shore of Lake Pontchartrain and the New Orleans and Baton Rouge metropolitan areas.
The property sits at the western end of an approximately eight-mile-long white sand beach, the closest such beach to the New Orleans and Baton Rouge metropolitan areas. Its customers are primarily from communities in southwestern Mississippi and southern Louisiana, including the North Shore of Lake Pontchartrain and the New Orleans and Baton Rouge metropolitan areas.
American Place / The Temporary The Temporary (and, upon opening, American Place) compete against two existing casinos which primarily serve the suburbs north of Chicago, a tribal casino in Milwaukee, and slot machines in bars (limited to six machines per bar) in many parts of Illinois.
American Place American Place competes against two existing casinos that primarily serve the northern suburbs of Chicago, a tribal casino in Milwaukee, and slot machines in bars (limited to six machines per bar) in many parts of Illinois. American Place is the only full-service casino in Lake County, Illinois, which has a population of approximately 709,000 residents.
Such efforts were not successful, as voters rejected the casino referendum by a vote of 63% to 37%. Mississippi does not have a limitation on the number of casino licenses, but requires casinos to be within approximately 800 feet of the Mississippi River shoreline or the Gulf of Mexico, as defined by state law.
Of such casinos, only one is not currently in operation and is not located near our Silver Slipper facility. Mississippi does not have a limitation on the number of casino licenses, but requires casinos to be within approximately 800 feet of the Mississippi River shoreline or the Gulf of Mexico, as defined by state law.
As in Colorado, we contracted with three companies to operate such skins under their own brands in exchange for a percentage of revenues, as defined in each contract, subject to annual minimum amounts. The sum of the minimum annual amounts in Indiana is currently $2 million with minimal expected expenses.
As in Colorado, we historically have contracted with outside companies to operate such skins under their own brands in exchange for a percentage of revenues, as defined in each contract, subject to annual minimum amounts. As of December 31, 2023, one of our three skins was live.
Our casino properties had 1,268 full-time and 259 part-time employees, as follows: ​ ​ ​ ​ ​ ​ ​ March 1, 2023 Employee Count by Property / Location Full-time Part-time Silver Slipper Casino and Hotel ​ 437 ​ 62 Bronco Billy’s Casino and Hotel ​ 150 ​ 61 Rising Star Casino Resort ​ 215 ​ 81 Grand Lodge Casino ​ 73 ​ 25 Stockman’s Casino 53 7 The Temporary / American Place ​ 340 ​ 23 Corporate 13 — Total Employees 1,281 259 ​ ​ We believe that our relationship with our employees is excellent.
Our casino properties had 1,536 full-time and 286 part-time employees, as follows: ​ ​ ​ ​ ​ ​ ​ March 1, 2024 Employee Count by Property / Location Full-time Part-time Silver Slipper Casino and Hotel ​ 422 ​ 49 American Place ​ 493 ​ 75 Rising Star Casino Resort ​ 222 ​ 72 Bronco Billy’s / Chamonix Casino Hotel ​ 263 ​ 66 Grand Lodge Casino ​ 75 ​ 17 Stockman’s Casino 61 7 Corporate 13 — Total Employees 1,549 286 ​ We believe that our relationship with our employees is excellent.
The permanent American Place facility is being designed to offer more, and better, amenities than any other casino operating today in Illinois. 8 Table of Contents Marketing Our marketing efforts are conducted through various means, including our customer loyalty programs and specialized marketing campaigns, such as our seasonal “Christmas Casino” event at Rising Star Casino Resort.
Including areas neighboring Lake County, we estimate that American Place is the closest casino to more than one million individuals. 12 Table of Contents Marketing Our marketing efforts are conducted through various means, including our customer loyalty programs and specialized marketing campaigns, such as our seasonal “Christmas Casino” event at Rising Star Casino Resort.
Two Native American gaming operations also exist in southwestern Colorado and there are tribal casinos in Oklahoma, but these are much further from Colorado Springs and Denver than Cripple Creek. There are no federally-recognized Native American tribes in the Colorado Front Range, which includes Denver and Colorado Springs.
Downtown Denver and Colorado Springs are approximately 70 miles apart and certain suburbs of each metropolitan area largely merge into the other. Two Native American gaming operations also exist in southwestern Colorado and there are tribal casinos in Oklahoma, but these are much further from Colorado Springs and Denver than Cripple Creek.
We are also designing our permanent American Place casino destination, which will be built adjacent to a temporary facility that we opened in February 2023 named The Temporary by American Place (“The Temporary”). We intend to operate The Temporary until the opening of American Place.
We are currently designing our permanent American Place casino destination, which will be built adjacent to a temporary facility that we opened in February 2023. We are currently permitted to operate the temporary American Place facility until August 2027. Additionally, we benefit from seven permitted sports wagering “skins” – three in Colorado, three in Indiana, and one in Illinois.
Bronco Billy’s Casino and Hotel (Cripple Creek, Colorado) Bronco Billy’s is located in Cripple Creek, Colorado, a historical gold mining town located approximately one hour from Colorado Springs and two hours from Denver. Its customers are primarily from the Colorado Springs/Pueblo/Cañon City metropolitan area, the second-largest metropolitan area in Colorado, with a population of approximately 982,000 residents.
Its customers are primarily from the Colorado Springs/Pueblo/Cañon City metropolitan area, the second-largest metropolitan area in Colorado, with a population of approximately 985,000 residents. Its secondary market, the Denver metropolitan area, has a population of approximately four million people.
We have registered several trademarks with the United States Patent and Trademark Office or otherwise acquired the licenses to use certain trademarks, patents and copyrights that are material to conduct our business. Employees As of March 1, 2023, we had 13 full-time corporate employees, four of whom are executive officers and one additional senior management employee.
Intellectual Property We use a variety of trademarks, patents and copyrights in our operations and believe that we have all the licenses necessary to conduct our continuing operations. We have registered several trademarks with the United States Patent and Trademark Office or otherwise acquired the licenses to use certain trademarks, patents and copyrights that are material to conduct our business.
Bronco Billy’s owns much of its real estate, but also leases certain parking lots and buildings, including a portion of the hotel and casino, under a long-term lease. The lease has six renewal options in three-year increments through January 2035, and we have the right to buy out the lease at any time during its term.
The lease has six renewal options in three-year increments through January 2035, and we have the right to buy out the lease at any time during its term. 8 Table of Contents We are allowed to offer online sports wagering through three sports “skins” in Colorado.
Management does not believe such efforts will be successful in the foreseeable future. 7 Table of Contents Bronco Billy’s Casino and Hotel and Chamonix Casino Hotel Bronco Billy’s and Chamonix are located in Cripple Creek, Colorado, which is a historical gold mining town located approximately one hour from Colorado Springs, on the west side of Pikes Peak.
A proposal in 2021 to relocate an existing riverboat casino license to the North Shore of Lake Pontchartrain failed to achieve approval in a local referendum by a 63-to-37 margin. 11 Table of Contents Bronco Billy’s / Chamonix Casino Hotel Bronco Billy’s and Chamonix are located in Cripple Creek, Colorado, which is a historical gold mining town located less than one hour from Colorado Springs, on the west side of Pikes Peak.
We also operate the hotel, food and beverage, and other on-site operations at Silver Slipper Casino and Hotel (“Silver Slipper”), Bronco Billy’s Casino and Hotel (“Bronco Billy’s”), Rising Star Casino Resort (“Rising Star”) and Stockman’s Casino (“Stockman’s”), as well as a golf course, recreational vehicle park (“RV park”) and ferry service at Rising Star and an RV park at Silver Slipper.
We also generally operate the hotel, food and beverage, and other on-site operations at our properties, although the steakhouse at Chamonix will be operated by a third party upon its expected opening in March 2024. Additionally, we operate a golf course, recreational vehicle park (“RV park”) and ferry service at Rising Star and an RV park at Silver Slipper.
Additionally, we benefit from seven permitted sports wagering “skins” – three in Colorado, three in Indiana, and one in Illinois. Other companies currently operate or will operate these online sports wagering sites under their brands, paying us a percentage of revenues, as defined, subject to annual minimum amounts.
Other companies currently operate the active online sports wagering websites under their brands, paying us a percentage of revenues, as defined, subject to annual minimum amounts. Regarding our remaining idle skins, we continue to evaluate whether to operate them ourselves or to have other third parties operate them.
Our Internet website and information contained on our Internet website are not part of this Annual Report on Form 10-K and are not incorporated by reference herein. ​ 9 Table of Contents Cautionary Note Regarding Forward-Looking Statements This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) for which the Private Securities Litigation Reform Act of 1995 provides a safe harbor.
Our Internet website and information contained on our Internet website are not part of this Annual Report on Form 10-K and are not incorporated by reference herein. ​ ​ 13 Table of Contents
As of December 31, 2022, Bronco Billy’s was one of nine gaming facilities operating in Cripple Creek. One of those competitors added a 100-guest-room hotel in 2021. Chamonix, which is currently under construction, will be significantly larger and is planned to be higher in quality than any of the existing casinos in Cripple Creek.
There are no federally-recognized Native American tribes in the Colorado Front Range, which includes Denver and Colorado Springs. As of December 31, 2023, Bronco Billy’s and Chamonix were two of ten gaming facilities operating in Cripple Creek. Chamonix is significantly larger and higher in quality than any of the existing casinos in Cripple Creek.
Our corporate headquarters is in Las Vegas, Nevada. 3 Table of Contents Our mission is to maximize stockholder value, while also being good employers and community participants. We seek to increase revenues by providing our customers with their favorite games and amenities, high-quality customer service, and appropriate customer loyalty programs.
We seek to increase revenues by providing our customers with their favorite games and amenities, high-quality customer service, and appropriate customer loyalty programs. Our customers include nearby residents who represent a high potential for repeat visits, along with drive-in tourist patrons.
Census Bureau, Lake County is the third most populous county in the state, and one of the wealthier counties in both Illinois and the United States. ​ In February 2023, we began opening The Temporary by American Place, a temporary casino facility that we will operate while the larger, more lavish American Place facility is under construction.
Waukegan is the county seat of Lake County, which has a population of approximately 709,000. According to the U.S. Census Bureau, Lake County is the third most populous county in the state, and one of the wealthier counties in both Illinois and the United States.
Operating Properties Silver Slipper Casino and Hotel (Hancock County, Mississippi) The Silver Slipper is the western-most casino on the Mississippi Gulf Coast, midway between Biloxi, Mississippi and New Orleans, Louisiana. The property sits at the western end of an approximately eight-mile-long white sand beach, the closest such beach to the New Orleans and Baton Rouge metropolitan areas.
At Grand Lodge Casino (“Grand Lodge”), the adjoining hotel and the food and beverage outlets are managed by Hyatt Regency Lake Tahoe Resort, Spa and Casino (“Hyatt Lake Tahoe”). Operating Properties Silver Slipper Casino and Hotel (Hancock County, Mississippi) The Silver Slipper is the western-most casino on the Mississippi Gulf Coast, midway between Biloxi, Mississippi and New Orleans, Louisiana.
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Alternatively, we may also choose to operate any available skins ourselves in the future.
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However, there is no certainty that we will be able to enter into agreements with replacement operators or successfully operate the skins ourselves.
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Our customers include nearby residents who represent a high potential for repeat visits, along with drive-in tourist patrons. We continuously focus on improving the operating results of our existing properties through a combination of revenue growth and expense management efforts.
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We manage our casinos based primarily on geographic regions within the United States and type of income. Our corporate headquarters is in Las Vegas, Nevada.
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At Grand Lodge Casino (“Grand Lodge”), the adjoining hotel and the food and beverage outlets are managed by Hyatt Regency Lake Tahoe Resort, Spa and Casino (“Hyatt Lake Tahoe”). In February 2023, we opened The Temporary. The Temporary currently operates for 20 hours per day, which may be expanded as operations continue to ramp up and we hire more employees.
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Starting in the first quarter of 2023, we updated our reportable segments to Midwest & South, West, and Contracted Sports Wagering, reflecting a realignment within the Company as a result of our continued growth. 7 Table of Contents Our mission is to maximize stockholder value, while also being good employers and community participants.
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We also manage a nearby 37-space, beachfront RV park under a management contract, which expires on March 31, 2025, unless canceled by either party with prior notice of 180 days.
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Bronco Billy’s Casino and Hotel / Chamonix Casino Hotel (Cripple Creek, Colorado) Bronco Billy’s and Chamonix are two integrated and adjoining casinos, and are operated by our management team as a single entity. This property is located in Cripple Creek, Colorado, a historical gold mining town located approximately one hour from Colorado Springs and two hours from Denver.
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Its secondary market, the Denver metropolitan area, has a population of approximately four million people. Bronco Billy’s occupies a significant portion of the key city block of Cripple Creek’s “casino strip.” In addition to gaming space, it currently offers 14 hotel rooms, two casual dining outlets, and a steakhouse that was temporarily closed in May 2022 for renovation work.
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It occupies a significant portion of the key city block of Cripple Creek’s “casino strip.” Chamonix began its phased opening on December 27, 2023.
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We also commenced a three-year lease in August 2018 for a key corner on our block that was subsequently extended through August 2023, which also includes an option to buy out the lease. 4 Table of Contents We are allowed to offer online sports wagering through three sports “skins” in Colorado.
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When complete, the combined Bronco Billy’s / Chamonix complex will offer two large integrated casinos, approximately 300 luxury guest rooms, 14 additional hotel rooms located nearby, three casual dining outlets, a steakhouse managed by a third-party, parking garage, rooftop pool, and spa.
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For Colorado, the sum of the minimum annual amounts is expected to be $3 million, including a contract that we signed in December 2022. We could receive more than $3 million on an annualized basis if our percentage-share of sports revenue exceeds our contractual minimums. We incur minimal expenses related to these revenues.
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We own much of the real estate for these two properties, but also lease certain parking lots and buildings, including a portion of the hotel and casino, under a long-term lease.
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As of December 31, 2022, two of our skins were live, and our third skin began its contractual term in March 2023 (see Note 9 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data”).
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For our idle skin, we continue to evaluate whether to operate it ourselves or to utilize a replacement operator. There is no certainty that we will be able to enter into an agreement with a replacement operator or successfully operate the skin ourselves.
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Chamonix Casino Hotel (Cripple Creek, Colorado) In 2018, we began planning and design work on Chamonix, a new and distinct, luxury hotel and casino, to be located adjacent to Bronco Billy’s in Cripple Creek.
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The lease was entered into in 2011 and has been extended several times, although there is no certainty that this will continue to be the case.
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Following changes made to the state’s gaming laws in November 2020, including the elimination of betting limits and the approval of new table games, we increased the size of Chamonix by 67% to approximately 300 luxury guest rooms and suites, from our previously-planned 180 guest rooms. Our construction budget for Chamonix is approximately $250 million.
Added
American Place is currently located in a temporary facility that we are permitted to operate until August 2027, which includes a large casino floor, a center bar, a fine-dining restaurant, two additional full-service restaurants, and two customized Airstream trailers located within the casino that serve beverages and quick meals. ​ We are currently developing the permanent American Place casino, which is projected to be completed in 2027 and will be located adjacent to the temporary facility.
Removed
To fund such construction, on February 12, 2021 we issued $310 million aggregate principal amount of 8.25% Senior Secured Notes due 2028 (the “2028 Notes”) and placed a portion of such proceeds into a restricted cash account dedicated to Chamonix’s construction (see Note 6 to the consolidated financial statements set forth in Part II, Item 8.
Added
We have an option to buy out the lease at any time for $30 million. If we do so prior to the opening of the permanent American Place facility, then we must continue to pay rent due to the City of Waukegan under this lease until the permanent casino is open. Government Regulation The gaming industry is highly regulated.
Removed
If our percentage-share of sports revenue exceeds our contractual minimums in one or more contracts, then we should receive in excess of $2 million from our Indiana sports agreements on an annualized basis. As of December 31, 2022, two of our skins were live; the third skin operator ceased operations on May 15, 2022.
Added
Employees As of March 1, 2024, we had 13 full-time corporate employees. We had four executive officers and three additional senior management employees.
Removed
American Place / The Temporary (Waukegan, Illinois) In December 2021, we were chosen by the Illinois Gaming Board (“IGB”) to develop American Place, a new gaming and entertainment destination located in Waukegan, Illinois, a northern suburb of Chicago, subject to final regulatory approvals. Waukegan is the county seat of Lake County, which has a population of approximately 714,000.
Removed
In Spring 2023, we expect to augment the number of available games on our casino floor and increase the hours of operation for our casino and its amenities. We also expect to open The Temporary’s second restaurant in the coming weeks, followed by our fine-dining restaurant in the second quarter of 2023.
Removed
When fully open, The Temporary will feature approximately 1,000 slot machines, 50 table games, a fine-dining restaurant, two additional restaurants, and a center bar.
Removed
At this time, all licenses for riverboat casinos in Louisiana have been granted and only one of such casinos is not currently in operation. In 2021, the owners of the closed casino attempted to move their gaming license from Bossier City to Slidell, Louisiana, where it would have competed with the Silver Slipper.
Removed
The Temporary is the only full-service casino in Lake County, Illinois, which has a population of approximately 700,000 residents. Including areas neighboring Lake County, we estimate that The Temporary is the closest casino to more than one million individuals.
Removed
Instead, our loyalty programs focus on providing each casino’s customers the amenities they most prefer in each market. Intellectual Property We use a variety of trademarks, patents and copyrights in our operations and believe that we have all the licenses necessary to conduct our continuing operations.
Removed
These forward-looking statements can be identified by use of terms such as “believes,” “expects,” “anticipates,” “estimates,” “plans,” “intends,” “objectives,” “goals,” “aims,” “projects,” “forecasts,” “future,” “possible,” “seeks,” “may,” “could,” “should,” “will,” “might,” “likely,” “enable,” or similar words or expressions, as well as statements containing phrases such as “in our view,” “we cannot assure you,” “although no assurance can be given,” or “there is no way to anticipate with certainty.” Examples of forward-looking statements include, among others, statements we make regarding our plans, beliefs or expectations regarding our growth strategies; our expected construction budgets, estimated commencement and completion dates, expected amenities, and our expected operational performance for Chamonix and American Place; our expected operational performance for The Temporary; our investments in capital improvements and other projects, including the amounts of such investments, the timing of commencement or completion of such capital improvements and projects and the resulting impact on our financial results; our sports wagering contracts with third-party providers, including the expected revenues and expenses and our expectations regarding our ability to replace our terminated sports wagering contract in Indiana or to operate sports wagering contracts ourselves; our expectation to exercise our buyout option on the Silver Slipper Casino and Hotel; adequacy of our financial resources to fund operating requirements and planned capital expenditures and to meet our debt and contractual obligations; expected sources of revenue; anticipated sources of funds; anticipated or potential legislative actions; beliefs in connection with our marketing efforts; factors that affect the financial performance of our properties; adequacy of our insurance; competitive outlook; outcome of legal matters; impact of recently issued accounting standards; and estimates regarding certain accounting and tax matters, among others.
Removed
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions.
Removed
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur debt could, among other things: ● require us to dedicate a large portion of our cash flow from operations to the servicing and repayment of our debt, thereby reducing funds available for working capital, capital expenditures and acquisitions, and other general corporate requirements; ● limit our ability to obtain additional financing to fund future working capital, capital expenditures and other general corporate requirements; ● limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; ● restrict our ability to make strategic acquisitions or dispositions or to exploit business opportunities; ● increase our vulnerability to general adverse economic and industry conditions and increases in interest rates; ● place us at a competitive disadvantage compared to our competitors that have less debt; and 25 Table of Contents ● adversely affect our credit rating, which may adversely affect our cost to borrow funds or the market price of our common stock. ​ Any of these risks could impact our ability to fund our operations or limit our ability to expand our business, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Biggest changeOur debt could, among other things: ● require us to dedicate a large portion of our cash flow from operations to the servicing and repayment of our debt, thereby reducing funds available for working capital, capital expenditures and acquisitions, and other general corporate requirements; ● limit our ability to obtain additional financing to fund future working capital, capital expenditures and other general corporate requirements; ● limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; ● restrict our ability to make strategic acquisitions or dispositions or to exploit business opportunities; ● increase our vulnerability to general adverse economic and industry conditions and increases in interest rates; ● place us at a competitive disadvantage compared to our competitors that have less debt; and ● adversely affect our credit rating, which may adversely affect our cost to borrow funds or the market price of our common stock. ​ Any of these risks could impact our ability to fund our operations or limit our ability to expand our business, which could have a material adverse effect on our business, financial condition, results of operations and prospects. 27 Table of Contents The indenture governing the Notes and the Credit Facility impose restrictive covenants and limitations that could significantly affect our ability to operate our business and lead to events of default if we do not comply with the covenants.
“Business – Competition .” In a broader sense, our casinos and sports wagering businesses face competition from all manner of leisure and entertainment activities, including other non-gaming resorts and vacation destinations, shopping, athletic events, television and movies, concerts, and travel. We may face revenue declines if discretionary consumer spending drops due to an economic downturn.
“Business – Competition .” In a broader sense, our casinos and sports wagering businesses face competition from all manner of leisure and entertainment activities, including other non-gaming resorts and vacation destinations, shopping, athletic events, television and movies, concerts, and travel. We may face revenue declines if discretionary consumer spending drops, including due to an economic downturn.
The operating expenses associated with our gaming properties could increase due to, among other reasons, the following factors: ● continued or increased inflationary pressures; ● supply chain issues that are beyond our control; ● changes in federal, state or local tax or regulations, including gaming regulations or gaming taxes, could impose additional restrictions or increase our operating costs; ● aggressive marketing and promotional campaigns by our competitors for an extended period of time could force us to increase our expenditures for marketing and promotional campaigns in order to maintain our existing customer base or attract new customers; ● as our properties age, we may need to increase our expenditures for repairs, maintenance, and to replace equipment necessary to operate our business in amounts greater than what we have spent historically; ● our reliance on slot play revenues and any additional costs imposed on us from slot machine vendors; ● availability and cost of the many products and services we provide our customers, including food, beverages, retail items, entertainment, hotel rooms, spa and golf; ● availability and costs associated with insurance; ● increases in costs of labor; ● our properties use significant amounts of electricity, natural gas and other forms of energy, and energy price increases may adversely affect our cost structure; ● our properties use significant amounts of water, and a water shortage may adversely affect our operations; and ● at Grand Lodge, we rely on Hyatt Lake Tahoe to provide certain items at reasonable costs, including food, beverages, parking and rooms.
The operating expenses associated with our gaming properties could increase due to, among other reasons, the following factors: ● continued or increased inflationary pressures; ● supply chain issues that are beyond our control; ● changes in federal, state or local tax or regulations, including gaming regulations or gaming taxes, could impose additional restrictions or increase our operating costs; ● aggressive marketing and promotional campaigns by our competitors for an extended period of time could force us to increase our expenditures for marketing and promotional campaigns in order to maintain our existing customer base or attract new customers; ● as our properties age, we may need to increase our expenditures for repairs, maintenance, and to replace equipment necessary to operate our business in amounts greater than what we have spent historically; ● our reliance on slot play revenues and any additional costs imposed on us from slot machine vendors; ● availability and cost of the many products and services we provide our customers, including food, beverages, retail items, entertainment, hotel rooms, spa services and golf; ● availability and costs associated with insurance; ● increases in costs of labor; ● our properties use significant amounts of electricity, natural gas and other forms of energy, and energy price increases may adversely affect our cost structure; ● our properties use significant amounts of water, and a water shortage may adversely affect our operations; and ● at Grand Lodge, we rely on Hyatt Lake Tahoe to provide certain items at reasonable costs, including food, beverages, parking and rooms.
If there is a prolonged disruption at our properties due to natural disasters, terrorist attacks or other catastrophic events, our results of operations and financial condition could be materially adversely affected. Several of our properties, including Silver Slipper, Bronco Billy’s and Rising Star, are accessed by our customers via routes that have few alternatives.
If there is a prolonged disruption at our properties due to natural disasters, terrorist attacks or other catastrophic events, our results of operations and financial condition could be materially adversely affected. Several of our properties, including Silver Slipper, Chamonix, Bronco Billy’s and Rising Star, are accessed by our customers via routes that have few alternatives.
Furthermore, during periods of economic contraction, our revenues may decrease while many of our costs remain fixed and some costs may increase, resulting in decreased earnings. 13 Table of Contents We cannot assure you that any of our contracted sports betting parties, through the use of our permitted website “skins,” will be able to compete effectively, that our contracted sports parties will have the ability and/or willingness to sustain sports betting operations should they experience an extended period of unprofitability, or that we will have the ability to replace existing partners or vendors on similar terms as our existing contractual revenue minimums or operate the skins ourselves.
Furthermore, during periods of economic contraction, our revenues may decrease while many of our costs remain fixed and some costs may increase, resulting in decreased earnings. 14 Table of Contents We cannot assure you that any of our contracted sports betting parties, through the use of our permitted website “skins,” will be able to compete effectively, that our contracted sports parties will have the ability and/or willingness to sustain sports betting operations should they experience an extended period of unprofitability, or that we will have the ability to replace existing partners or vendors on similar terms as our existing contractual revenue minimums or operate the skins ourselves.
The obligations under the Notes and the Credit Facility are collateralized by a security interest in substantially all of our assets, so if we default on those obligations, the holders of the Notes and lenders under the Credit Facility could foreclose on our assets. In addition, the existence of these security interests may adversely affect our financial flexibility.
The obligations under the Notes and the Credit Facility are collateralized by a security interest in substantially all of our assets. If we default on those obligations, the holders of the Notes and lenders under the Credit Facility could foreclose on our assets. In addition, the existence of these security interests may adversely affect our financial flexibility.
This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors. 26 Table of Contents We cannot assure you that our business will generate sufficient cash flows from operations or asset sales, our anticipated growth in operations, including through our expansion efforts, will be realized, or that future borrowings will be available to us in amounts sufficient to enable us to repay the Notes, and any amounts outstanding under the Credit Facility and to fund our other liquidity needs.
This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors. 28 Table of Contents We cannot assure you that our business will generate sufficient cash flows from operations or asset sales, our anticipated growth in operations, including through our expansion efforts, will be realized, or that future borrowings will be available to us in amounts sufficient to enable us to repay the Notes, and any amounts outstanding under the Credit Facility and to fund our other liquidity needs.
We cannot assure you that our business will generate sufficient cash flow from operations, or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or fund our other liquidity needs.
We cannot assure you that our business will generate sufficient cash flow from operations, or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or fund our other liquidity or operational needs.
Inability to protect our intellectual property rights could have a material adverse effect on our prospects, business, financial condition or results of operations. ​ 19 Table of Contents Our commercial success depends upon us avoiding the infringement of intellectual property rights owned by others and any such infringements, including those that are inadvertent, may have a material adverse effect on our business. ​ The industries in which we compete have many participants that own, or claim to own, intellectual property, including participants that own intellectual property similar to our own, and proprietary rights for technologies similar to those used or licensed by us.
Inability to protect our intellectual property rights could have a material adverse effect on our prospects, business, financial condition or results of operations. ​ 20 Table of Contents Our commercial success depends upon us avoiding the infringement of intellectual property rights owned by others and any such infringements, including those that are inadvertent, may have a material adverse effect on our business. ​ The industries in which we compete have many participants that own, or claim to own, intellectual property, including participants that own intellectual property similar to our own, and proprietary rights for technologies similar to those used or licensed by us.
As described elsewhere in these Risk Factors, such events may result in closures of our properties, a period of business disruption, and/or in reduced operations, any of which could materially affect our business, financial condition and results of operations. 16 Table of Contents Catastrophic events, such as terrorist and war activities in the United States and elsewhere, when they occur, have had a negative effect on travel and leisure expenditures, including lodging, gaming and tourism.
As described elsewhere in these Risk Factors, such events may result in closures of our properties, a period of business disruption, and/or in reduced operations, any of which could materially affect our business, financial condition and results of operations. 17 Table of Contents Catastrophic events, such as terrorist and war activities in the United States and elsewhere, when they occur, have had a negative effect on travel and leisure expenditures, including lodging, gaming and tourism.
Many factors could cause the market price of our common stock to rise and fall, including: ● actual or anticipated variations in our quarterly results of operations; ● the impact of the coronavirus pandemic on our business; ● change in market valuations of companies in our industry; ● change in expectations of future financial performance; ● regulatory changes; ● fluctuations in stock market prices and volumes; ● issuance of common stock market prices and volumes; ● the addition or departure of key personnel; and ● announcements by us or our competitors of acquisitions, investments, dispositions, joint ventures or other significant business decisions. ​ In addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to companies’ operating performance, for example, as a result of the coronavirus epidemic or increases in the borrowing rates set by the Federal Reserve.
Many factors could cause the market price of our common stock to rise and fall, including: ● actual or anticipated variations in our quarterly results of operations; ● change in market valuations of companies in our industry; ● change in expectations of future financial performance; ● regulatory changes; ● fluctuations in stock market prices and volumes; ● issuance of common stock market prices and volumes; ● the addition or departure of key personnel; and ● announcements by us or our competitors of acquisitions, investments, dispositions, joint ventures or other significant business decisions. ​ In addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to companies’ operating performance, for example, as a result of the coronavirus epidemic or increases in the borrowing rates set by the Federal Reserve.
Our development and expansion projects are exposed to significant risks, including: ● shortage of materials, including due to supply chain issues that are beyond our control; ● shortage of skilled labor or work stoppages; ● unforeseen construction scheduling, engineering, excavation, environmental or geological problems; ● increases in the cost of steel and other raw materials for construction, driven by inflation, U.S. tariffs on imports, demand, higher labor and construction costs and other factors, may cause price increases beyond those anticipated in the budgets for our development projects; ● natural disasters, hurricanes, weather interference, changes in river levels, floods, fires, earthquakes, the impacts of pandemic such as coronavirus, or other casualty losses or delays; ● unanticipated cost increases or delays in completing the project; ● delays in obtaining, or inability to obtain or maintain, necessary license or permits; ● lack of sufficient funds, or delays in the availability of, financing; ● failure to comply with the terms of our disbursement agreements under our indenture could limit our access to funds for the projects; ● changes to plans or specifications; ● performance by contractors and subcontractors; ● disputes with contractors; ● mechanic’s liens on real property collateral that may have priority over the liens securing our indebtedness; ● personal injuries to workers and other persons; ● structural heights and the use of cranes; ● disruption of our operations caused by diversion of management’s attention to new development projects and construction at our existing properties; ● remediation of environmental contamination at some of our proposed construction sites, which may prove more difficult or expensive than anticipated in our construction budgets; ● failure to obtain and maintain necessary gaming regulatory approvals and licenses, or failure to obtain such approvals and licenses on a timely basis; ● requirements or government-established “goals” concerning union labor or requiring that a portion of the project expenditures be through companies controlled by specific ethnic or gender groups, goals that may not be obtainable, or may only be obtainable at additional project cost; and ● other unanticipated circumstances or cost increases. ​ The occurrence of any of the foregoing could increase the total costs of a project, or delay or prevent its construction, development, expansion or opening.
Our development and expansion projects are exposed to significant risks, including: ● shortage of materials, including due to supply chain issues that are beyond our control; ● shortage of skilled labor or work stoppages; ● unforeseen construction scheduling, engineering, excavation, environmental or geological problems; ● increases in the cost of steel and other raw materials for construction, driven by inflation, U.S. tariffs on imports, demand, higher labor and construction costs and other factors, may cause price increases beyond those anticipated in the budgets for our development projects; ● natural disasters, hurricanes, weather interference, changes in river levels, floods, fires, earthquakes, the impacts of pandemics, or other casualty losses or delays; ● unanticipated cost increases or delays in completing the project; ● delays in obtaining, or inability to obtain or maintain, necessary licenses or permits; ● lack of sufficient funds, or delays in the availability of, financing; ● failure to comply with the terms of our disbursement agreements under our indenture could limit our access to funds for the projects; ● changes to plans or specifications; ● performance by contractors and subcontractors; ● disputes with contractors; ● mechanic’s liens on real property collateral that may have priority over the liens securing our indebtedness; ● personal injuries to workers and other persons; ● structural heights and the use of cranes; ● disruption of our operations caused by diversion of management’s attention to new development projects and construction at our existing properties; ● potential remediation of environmental contamination at our proposed construction sites, which may prove more difficult or expensive than anticipated in our construction budgets; ● failure to obtain and maintain necessary gaming regulatory approvals and licenses, or failure to obtain such approvals and licenses on a timely basis; ● requirements or government-established “goals” concerning union labor or requiring that a portion of the project expenditures be through companies controlled by specific ethnic or gender groups, goals that may not be obtainable, or may only be obtainable at additional project cost; and ● other unanticipated circumstances or cost increases. ​ The occurrence of any of the foregoing could increase the total costs of a project, or delay or prevent its construction, development, expansion or opening.
Although we believe that our cash, cash equivalents, working capital, future cash from operations, and the capital obtained from the Notes and available borrowing under the Credit Facility will provide adequate resources to fund completion of Chamonix, the Temporary at American Place and ongoing operating requirements, we may need to refinance or seek additional financing to compete effectively or grow our business, including to complete the permanent American Place facility.
Although we believe that our cash, cash equivalents, working capital, future cash from operations, and the capital obtained from the Notes and available borrowing under the Credit Facility will provide adequate resources to fund completion of Chamonix and ongoing operating requirements, we may need to refinance or seek additional financing to compete effectively or grow our business, including to complete the permanent American Place facility.
In addition, at the state level, there may be periods during which the use of NOL carryforwards is suspended or otherwise limited, which could accelerate or permanently increase state taxes owed. 32 Table of Contents The market price for our common stock may be volatile, and investors may not be able to sell our stock at a favorable price or at all.
In addition, at the state level, there may be periods during which the use of NOL carryforwards is suspended or otherwise limited, which could accelerate or permanently increase state taxes owed. 34 Table of Contents The market price for our common stock may be volatile, and investors may not be able to sell our stock at a favorable price or at all.
Our casinos and contracted sport wagering businesses compete with other forms of gaming, such as casinos, racetracks, state-sponsored lotteries, sweepstakes, charitable gaming, video gaming terminals at bars, restaurants, taverns and truck stops, illegal slot machines and skill games, fantasy sports and internet or mobile-based gaming platforms, including online gaming and sports betting.
Our casinos and contracted sport wagering businesses compete with other forms of gaming, such as casinos, racetracks, state-sponsored lotteries, sweepstakes, charitable gaming, video gaming terminals at bars, restaurants, taverns and truck stops, sports books at sports stadiums, illegal slot machines and skill games, fantasy sports and internet or mobile-based gaming platforms, including online gaming and sports betting.
In addition, failure to comply with applicable laws and regulations may result in administrative and civil penalties, criminal sanctions or, in certain cases, the suspension or termination of our ferry boat service. 30 Table of Contents Risks Related to Technology Our gaming operations rely heavily on technology services and an uninterrupted supply of electrical power.
In addition, failure to comply with applicable laws and regulations may result in administrative and civil penalties, criminal sanctions or, in certain cases, the suspension or termination of our ferry boat service. 32 Table of Contents Risks Related to Technology Our gaming operations rely heavily on technology services and an uninterrupted supply of electrical power.
If we fail to retain our current employees, it would be difficult and costly to identify, recruit and train replacements needed to continue to conduct and expand our business. There can be no assurance that we will be able to retain and motivate our employees. 17 Table of Contents Higher wage and benefit costs could adversely affect our business.
If we fail to retain our current employees, it would be difficult and costly to identify, recruit and train replacements needed to continue to conduct and expand our business. There can be no assurance that we will be able to retain and motivate our employees. 18 Table of Contents Higher wage and benefit costs could adversely affect our business.
In addition, negative publicity related to such schemes could have an adverse effect on our reputation, potentially causing a material adverse effect on our business, financial condition, results of operations and cash flows. 18 Table of Contents Win rates for our gaming operations depend on a variety of factors, some beyond our control.
In addition, negative publicity related to such schemes could have an adverse effect on our reputation, potentially causing a material adverse effect on our business, financial condition, results of operations and cash flows. 19 Table of Contents Win rates for our gaming operations depend on a variety of factors, some beyond our control.
Any expansion of gaming or restriction on or prohibition of our gaming operations or enactment of other adverse regulatory changes could have a material adverse effect on our operating results. 29 Table of Contents Stockholders may be required to dispose of their shares of our common stock if they are found unsuitable by gaming authorities.
Any expansion of gaming or restriction on or prohibition of our gaming operations or enactment of other adverse regulatory changes could have a material adverse effect on our operating results. 31 Table of Contents Stockholders may be required to dispose of their shares of our common stock if they are found unsuitable by gaming authorities.
We and our subsidiaries may still be able to incur substantially more debt, which could further exacerbate the risks described above. We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The indentures governing the Notes and the Credit Facility do not fully prohibit us or our subsidiaries from doing so.
We and our subsidiaries may still be able to incur substantially more debt, including subordinated debt, which could further exacerbate the risks described above. We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The indentures governing the Notes and the Credit Facility do not fully prohibit us or our subsidiaries from doing so.
The success of their sports betting operations is dependent on a number of factors that are beyond their control, and ours, including the ultimate tax rates and license fees charged by jurisdictions across the United States; their ability to gain market share in a newly developing market; the timeliness and the technological and popular viability of their products; their ability to compete with new entrants in the market; changes in consumer demographics and public tastes and preferences; and the availability and popularity of other forms of entertainment.
The success of their sports betting operations is dependent on a number of factors that are beyond their control, and ours, including the ultimate tax rates and license fees charged by jurisdictions across the United States; their ability to gain market share in a newly developing market; the timeliness and the technological and popular viability of their products; their ability to compete with new entrants in the market; marketing offerings of their competitors; changes in consumer demographics and public tastes and preferences; and the availability and popularity of other forms of entertainment.
In the event that we do not receive distributions from our subsidiaries, we may be unable to make required principal and interest payments on our indebtedness, including the Notes and the Credit Facility. 27 Table of Contents Our ability to obtain additional financing on commercially reasonable terms may be limited.
In the event that we do not receive distributions from our subsidiaries, we may be unable to make required principal and interest payments on our indebtedness, including the Notes and the Credit Facility. 29 Table of Contents Our ability to obtain additional financing on commercially reasonable terms may be limited.
Furthermore, because we are subject to regulation in each jurisdiction in which we operate, and because regulatory agencies within each jurisdiction review our compliance with gaming laws in other jurisdictions, it is possible that gaming compliance issues in one jurisdiction may lead to reviews and compliance issues in other jurisdictions. 28 Table of Contents Taxation and fees.
Furthermore, because we are subject to regulation in each jurisdiction in which we operate, and because regulatory agencies within each jurisdiction review our compliance with gaming laws in other jurisdictions, it is possible that gaming compliance issues in one jurisdiction may lead to reviews and compliance issues in other jurisdictions. 30 Table of Contents Taxation and fees.
Although our Indiana casino vessel does not leave its moorings in normal operations, there are risks associated with the movement or mooring of vessels on waterways, including risks of casualty due to river turbulence, flooding, collisions with other vessels and severe weather conditions.
Although our Indiana casino vessel does not leave its moorings in normal operations, there are risks associated with the mooring of vessels on waterways, including risks of casualty due to river turbulence, flooding, collisions with other vessels and severe weather conditions.
Decreases in discretionary consumer spending brought about by factors such as, but not limited to, lackluster recoveries from recessions; increases in costs of goods and services due to continued or increased inflationary pressures; pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases such as COVID-19; high unemployment levels; higher income taxes; low levels of consumer confidence; weakness or uncertainty in the housing market; cultural and demographic changes; the impact of high energy, fuel, food and healthcare costs; fears of war or actual conflicts, such as the Russian invasion of Ukraine, civil unrest, terrorism or violence; and increased stock market volatility may negatively impact our revenues and operating cash flow.
Decreases in discretionary consumer spending or changes in consumer preferences brought about by factors such as, but not limited to, lackluster recoveries from recessions; increases in interest rates; increases in costs of goods and services due to continued or increased inflationary pressures; pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases; high unemployment levels; higher income taxes; low levels of consumer confidence; weakness or uncertainty in the housing market; cultural and demographic changes; the impact of high energy, fuel, food and healthcare costs; fears of war or actual conflicts, such as the Russian invasion of Ukraine, civil unrest, terrorism or violence; and increased stock market volatility may negatively impact our revenues and operating cash flow.
Risks from regional conditions include the following: 14 Table of Contents ● regional economic conditions; ● regional competitive conditions, including legalization or expansion of gaming in Mississippi, Colorado, Indiana, Nevada, Illinois or in neighboring states; ● allowance of new types of gaming, such as the introduction of online sports wagering in Louisiana or Internet gaming; ● reduced land or air travel due to increasing fuel costs or transportation disruptions; and, ● vulnerability to regional economic downturns in the markets in which we operate. ​ Some of our operations are located on leased property.
Risks from regional conditions include the following: ● regional economic conditions; ● regional competitive conditions, including legalization or expansion of gaming in Mississippi, Colorado, Indiana, Nevada, Illinois or in neighboring states; ● allowance of new types of gaming, such as the introduction of online sports wagering or Internet gaming; ● reduced land or air travel due to increasing fuel costs or transportation disruptions; and, ● vulnerability to regional economic downturns in the markets in which we operate. ​ Some of our operations are located on leased property.
Any harm to our reputation could impact employee engagement and retention and the willingness of customers and our partners to do business with us, which could have a material adverse effect on our business, results of operations and cash flows. 20 Table of Contents Risks Related to Development and Growth Opportunities We are engaged from time to time in one or more construction and development projects, including Chamonix and American Place, and many factors could prevent us from completing them as planned.
Any harm to our reputation could impact employee engagement and retention and the willingness of customers and our partners to do business with us, which could have a material adverse effect on our business, results of operations and cash flows. 21 Table of Contents Risks Related to Development and Growth Opportunities We are engaged from time to time in one or more construction and development projects, such as Chamonix and American Place, and many factors could prevent us from completing them as planned.
Additionally, substantial increases in the cost of electricity and natural gas could negatively affect our results of operations. Our information technology and other systems are subject to cyber-security risk, misappropriation of customer information and other breaches of information security.
Additionally, substantial increases in the cost of electricity and natural gas could negatively affect our results of operations. Our information technology and other systems are subject to cybersecurity risk, misappropriation of customer information and other breaches of information security.
The operation of our ferry boat is subject to various inherent risks, including: ● catastrophic marine disasters and accidents; ● adverse weather conditions or natural disasters; ● mechanical failure or equipment damage; ● hazardous substance spills; and ● navigation and human errors. ​ The occurrence of any of these events may result in, among other things, damage to or loss of our ferry boat, damage to other vessels and the environment, loss of revenues, short-term or long-term interruption of ferry boat service, termination of our vessel charter or other contracts, fines, penalties or other restrictions on conducting business, damage to our reputation and customer relationships, and death or injury to personnel and passengers.
The operation of our ferry boat is subject to various inherent risks, including: ● catastrophic marine disasters and accidents; ● adverse weather conditions or natural disasters; ● mechanical failure or equipment damage; ● hazardous substance spills; and ● navigation and human errors. ​ The occurrence of any of these events may result in, among other things, damage to or loss of our ferry boat, damage to other vessels and the environment, loss of revenues, short-term or long-term interruption of ferry boat service, termination of our regulatory permission to operate, fines, penalties or other restrictions on conducting business, damage to our reputation and customer relationships, and death or injury to personnel and passengers.
There can be no assurance that the potential impacts of climate change and severe weather will not have a material adverse effect on our properties, operations or business. If a pandemic, epidemic or outbreak of an infectious disease, such as the COVID-19 pandemic, occurs in the United States or on a global scale, our business may be adversely affected.
There can be no assurance that the potential impacts of climate change and severe weather will not have a material adverse effect on our properties, operations or business. If a pandemic, epidemic or outbreak of an infectious disease occurs in the United States or on a global scale, our business may be adversely affected.
The Silver Slipper is located at the end of a dead-end road, with no other access. Bronco Billy’s is accessed by most guests via a mountain pass; if that pass is closed for any reason, the alternative is longer.
The Silver Slipper is located at the end of a dead-end road, with no other access. Chamonix and Bronco Billy’s are accessed by most guests via a mountain pass; if that pass is closed for any reason, the alternative is longer.
Should any of our contracted sports betting parties cease operations, whether due to unprofitability or for other reasons, there can be no assurance that we will be able to replace them on similar terms as our existing agreements or at all, or that we will be able to successfully operate the skins ourselves.
Should any of our contracted sports betting parties cease operations, as has happened in the past, whether due to unprofitability or for other reasons, there can be no assurance that we will be able to replace them on similar terms as our existing agreements or at all, or that we will be able to successfully operate the skins ourselves.
Acts of fraud or cheating could involve the use of counterfeit chips or other tactics, possibly in collusion with our employees. Internal acts of cheating could also be conducted by employees directly or through collusion with dealers, surveillance staff, floor managers or other casino or gaming area staff.
Acts of fraud or cheating could involve the use of counterfeit chips or other tactics, possibly in collusion with our employees. Internal acts of cheating could also be conducted by employees directly or through collusion with dealers, surveillance staff, floor managers or other staff.
Further, the perception that such securities might be exercised could adversely affect the trading price of our shares of common stock. During the time that such securities are outstanding, they may adversely affect the terms on which we could obtain additional capital. Item 1B. Unresolved Staff Comments. Not applicable. 33 Table of Contents Item 2. Properties.
Further, the perception that such securities might be exercised could adversely affect the trading price of our shares of common stock. During the time that such securities are outstanding, they may adversely affect the terms on which we could obtain additional capital. Item 1B. Unresolved Staff Comments. Not applicable. 35 Table of Contents
We may not obtain the necessary permits, licenses, entitlements and approvals within the anticipated time frames, or at all. Insufficient or lower-than-expected results generated from our new developments and acquired properties may negatively affect our operating results and financial condition.
We may not obtain the necessary permits, licenses, entitlements and approvals within the anticipated time frames, or at all. 26 Table of Contents Insufficient or lower-than-expected results generated from our new developments and acquired properties may negatively affect our operating results and financial condition.
If the lessor of the Grand Lodge Casino exercises its buyout rights or if we default on this or certain of our other leases, the applicable lessors could terminate the affected leases and we could lose possession of the affected casino.
If the lessor of the Grand Lodge Casino exercises its buyout rights or fails to extend the lease, or if we default on this or certain of our other leases, the applicable lessors could terminate the affected leases and we could lose possession of the affected casino.
The occurrence of any of these issues could adversely affect our prospects, financial condition and results of operations. 22 Table of Contents Failure to comply with the terms of our disbursement agreement related to Chamonix could limit our access to funds. As of December 31, 2022 , we had approximately $134.6 million deposited in a construction disbursement account for Chamonix.
The occurrence of any of these issues could adversely affect our prospects, financial condition and results of operations. Failure to comply with the terms of our disbursement agreement related to Chamonix could limit our access to funds. As of December 31, 2023 , we had approximately $37.6 million deposited in a construction disbursement account for Chamonix.
The occurrence of any of the foregoing could, therefore, expose us to substantial uninsured losses. There is no certainty that insurance companies will continue to offer insurance at acceptable rates, or at all, in hurricane-prone areas or other areas affected by extreme weather, including the Mississippi Gulf Coast.
The occurrence of any of the foregoing could, therefore, expose us to substantial uninsured losses. There is no certainty that insurance companies will continue to offer insurance at acceptable rates, or at all, in hurricane-prone areas or other areas affected by extreme weather, including the Mississippi Gulf Coast. Our cost of insurance has risen significantly in recent years.
Natural disasters and extreme weather conditions, potentially exacerbated by climate change, such as major hurricanes, tornadoes, typhoons, floods, fires and earthquakes, could adversely affect our business and operating results. Certain of our properties are located in areas that may be subject to extreme weather conditions.
Natural disasters and extreme weather conditions, potentially exacerbated by climate change, such as major hurricanes, tornadoes, typhoons, floods, fires and earthquakes, could adversely affect our business and operating results. Certain of our properties are located in areas that may be subject to extreme weather conditions. Hurricanes are common in the area in which our Mississippi property is located.
In addition to the construction and regulatory risks associated with the development of our growth projects, including Chamonix and American Place, we cannot assure you that the level of consumer demand for these projects will meet our expectations.
There is no assurance that our growth projects, including Chamonix and American Place, will be successful. In addition to the construction and regulatory risks associated with the development of our growth projects, including Chamonix and American Place, we cannot assure you that the level of consumer demand for these projects will meet our expectations.
Such occurrences may also result in a significant increase in our operating costs or liability to third parties. Our Mississippi casino hotel currently generates a significant percentage of our revenues and Adjusted EBITDA. Our ability to meet our operating and debt service requirements is dependent, in part, upon the continued success of that property.
Such occurrences may also result in a significant increase in our operating costs or liability to third parties. Our Mississippi casino hotel and Illinois casino operations currently generate a significant percentage of our revenues and Adjusted EBITDA. Our ability to meet our operating and debt service requirements is dependent, in part, upon the continued success of those properties.
Our contracted sports betting parties, through the use of our permitted website “skins,” compete in a rapidly evolving and highly competitive market against an increasing number of competitors.
Our contracted sports betting parties, through the use of our permitted website “skins,” compete in a rapidly evolving and highly competitive market.
Our ability to meet our operating and debt service requirements is dependent, in part, upon the continued success of that property. ● We derive our revenues and operating income from our properties located in Mississippi, Colorado, Indiana, Nevada and Illinois, and are especially subject to certain risks, including economic and competitive risks, associated with the conditions in those areas and in the states from which we draw patrons. ● Some of our operations are located on leased property.
Likewise, our ability to meet our operating and debt service requirements is dependent, in part, upon the continued success of these properties. 15 Table of Contents We derive our revenues and operating income from our properties located in Mississippi, Colorado, Indiana, Nevada and Illinois, and are especially subject to certain risks, including economic and competitive risks, associated with the conditions in those areas and in the states from which we draw patrons.
We generally carry insurance to cover certain liabilities related to construction, but not all risks are covered, and it is uncertain whether such insurance will provide sufficient payment in a timely fashion even for those risks that are insured and material to us. 21 Table of Contents The construction costs for our growth projects, including Chamonix and American Place, may exceed budgeted amounts plus contingencies, which may result in insufficient funds to complete these projects or the need to raise additional capital.
We generally carry insurance to cover certain liabilities related to construction, but not all risks are covered, and it is uncertain whether such insurance will provide sufficient payment in a timely fashion even for those risks that are insured and material to us. 22 Table of Contents The construction costs for our growth projects, including Chamonix and American Place, may exceed budgeted amounts plus contingencies.
A prolonged closure of our casinos would negatively impact our ability to service our debt. Our casinos are our primary sources of income and operating cash flows that we rely upon to pay all of our obligations and to remain in compliance with debt covenants under any indebtedness we may incur and meet our obligations when due.
Our casinos are our primary sources of income and operating cash flows that we rely upon to pay all of our obligations and to remain in compliance with debt covenants under any indebtedness we may incur and meet our obligations when due.
We are currently constructing Chamonix in Cripple Creek, Colorado, adjoining and connected to our existing Bronco Billy’s casino. We also intend to construct the permanent American Place facility in Waukegan, Illinois, located adjacent to The Temporary.
We are currently in the final stages of construction at Chamonix in Cripple Creek, Colorado, adjoining and connected to our existing Bronco Billy’s casino. We also intend to construct the permanent American Place facility in Waukegan, Illinois, located adjacent to its current temporary facility.
The permanent American Place facility, additional growth projects or potential enhancements at our properties may require us to raise additional capital. We may need to access financial institution sources, capital markets, private sources or otherwise obtain additional funds to fund the permanent American Place facility.
We may need to access financial institution sources, capital markets, private sources or otherwise obtain additional funds to fund the permanent American Place facility. Additional capital may also be needed to fund other growth projects or potential enhancements we may undertake at our other properties.
(“BIPA”) applies to the collection and use of “biometric identifiers” and “biometric information” which include fingerprints and facial scans. BIPA requires written notice and consent before a private entity (like us and our subsidiaries) may collect or disseminate biometric information.
For example, the Illinois Biometric Information Privacy Act, 740 ILCS 14/1 et seq. (“BIPA”) applies to the collection and use of “biometric identifiers” and “biometric information” which include fingerprints and facial scans. BIPA requires written notice and consent before a private entity (like us and our subsidiaries) may collect or disseminate biometric information.
Mandatory prepayments, in whole or in part, of the Notes will be required upon the occurrence of certain events, including sales of certain assets, upon certain changes of control, or should the Company have certain unused funds in the construction disbursement account following the completion of Chamonix.
Mandatory prepayments, in whole or in part, of the Notes will be required upon the occurrence of certain events, including sales of certain assets (unless the proceeds from the sale are reinvested in other facilities within specified periods), upon certain changes of control, or should the Company have certain unused funds in the construction disbursement account following the completion of Chamonix.
Our growth may be fueled, in part, by the acquisition of existing gaming and development properties. In addition to standard closing conditions, our material transactions, including but not limited to acquisitions, are often conditioned on the receipt of regulatory approvals and other hurdles that create uncertainty and could increase costs.
In addition to standard closing conditions, our material transactions, including but not limited to acquisitions, are often conditioned on the receipt of regulatory approvals and other hurdles that create uncertainty and could increase costs.
As a result, the realization of anticipated benefits may be delayed or substantially reduced. Events outside of our control, including changes in state and federal regulations and laws, as well as economic trends, also could adversely affect our ability to realize the anticipated benefits from the acquisition or development. We expect to continue pursuing expansion opportunities.
Events outside of our control, including changes in state and federal regulations and laws, as well as economic trends, also could adversely affect our ability to realize the anticipated benefits from the acquisition or development. We expect to continue pursuing expansion opportunities. We regularly evaluate opportunities for acquisition and development of new properties.
Additional capital may also be needed to fund other growth projects or potential enhancements we may undertake at our other properties. We do not know when, or if, financial institution sources, capital markets or private sources will permit us to raise additional funds for such phases and enhancements in a timely manner, on acceptable terms, or at all.
We do not know when, or if, financial institution sources, capital markets or private sources will permit us to raise additional funds for such phases and enhancements in a timely manner, on acceptable terms, or at all.
The Pre-Construction Services Agreement and Letter of Intent with our general contractor for Chamonix provides that the cost of construction may increase and the deadlines for the contractor’s obligations to complete construction may be adjusted for alterations in the project’s scope. We may enter into similar arrangements with the general contractor for American Place.
Although construction of Chamonix is nearing completion, the Pre-Construction Services Agreement and Letter of Intent with our general contractor for Chamonix provides that the cost of construction may increase and the deadlines for the contractor’s obligations to complete construction may be adjusted for alterations in the project’s scope.
The loss of the lease through exercise of buyout rights or through termination upon default could have a significant adverse effect on our business, financial condition and results of operations as we would then be unable to operate all or portions of the affected facilities, which, in turn, may result in a default under our debt agreements.
The loss of a lease could have a significant adverse effect on our business, financial condition and results of operations and we may then be unable to operate all or portions of the affected facilities, which, in turn, may result in a default under our debt agreements. 16 Table of Contents A prolonged closure of our casinos would negatively impact our ability to service our debt.
We intend to avoid having an extended period of time between the closing of The Temporary and the opening of American Place, as it could be detrimental to our business, but there is no certainty that this can be achieved. Completion of these projects could also be delayed by weather, labor shortages or other construction delays.
We intend to avoid having an extended period of time between the closing of the temporary and the opening of the permanent American Place facilities, as it could be detrimental to our business, but there is no certainty that this can be achieved.
The integration of properties we may develop or acquire will require the dedication of management resources that may temporarily divert attention from our day-to-day business. The process of integrating properties that we may acquire also could interrupt the activities of those businesses, which could have a material adverse effect on our business, financial condition and results of operations.
The process of integrating properties that we may acquire also could interrupt the activities of those businesses, which could have a material adverse effect on our business, financial condition and results of operations.
Adverse weather conditions, road construction, gasoline shortages and other factors affecting our facilities and the areas in which we operate could make it more difficult for potential customers to travel to our properties and deter customers from visiting our properties. Our continued success depends upon our ability to draw customers from each of the geographic markets in which we operate.
Our ability to obtain additional financing would depend in part on factors outside of our control. Adverse weather conditions, road construction, gasoline shortages and other factors affecting our facilities and the areas in which we operate could make it more difficult for potential customers to travel to our properties and deter customers from visiting our properties.
If we make new acquisitions or new investments, we may face additional risks related to our business, results of operations, financial condition, liquidity, ability to satisfy financial covenants and comply with other restrictive covenants under our indenture, and ability to pay or refinance our indebtedness. 23 Table of Contents The occurrence of some or all of the above-described events could have a material adverse effect on our business, financial condition and results of operations.
If we make new acquisitions or new investments, we may face additional risks related to our business, results of operations, financial condition, liquidity, ability to satisfy financial covenants and comply with other restrictive covenants under our indenture, and ability to pay or refinance our indebtedness.
As of December 31, 2022, the total principal amount of our indebtedness, excluding unamortized debt issuance costs, was $410.0 million, consisting entirely of the Notes. Our Credit Facility was drawn for $36.0 million in January 2023 and remains outstanding as of this report date. The Notes and the Credit Facility are summarized in Part I, Item 1.
As of December 31, 2023, the total principal amount of our indebtedness, excluding unamortized debt issuance costs, was $450.0 million, consisting entirely of the Notes. Our Credit Facility remains outstanding for $27.0 million as of this report date.
If our contingency, cash flow from operations and anticipated excess liquidity are insufficient to cover any shortfall, we may not have sufficient funds to complete the projects without seeking additional capital or at all. There is no assurance that our growth projects, including Chamonix and American Place, will not be subject to additional regulatory restrictions, delays, or challenges.
If our contingency, cash flow from operations and anticipated excess liquidity are insufficient to cover any shortfall, we may not have sufficient funds to complete the projects without seeking additional capital or at all.
Some insurance companies may significantly limit the amount of coverage they will write in these markets and increase the premiums charged for this coverage. Additionally, uncertainty can occur as to the viability of certain insurance companies.
We have attempted to ameliorate such increased costs with reduced coverages and higher deductibles, in part creating additional risks. Some insurance companies may significantly limit the amount of coverage they will write in these markets and increase the premiums charged for this coverage. Additionally, uncertainty can occur as to the viability of certain insurance companies.
Delays in opening new or upgraded facilities could lead to increased costs and delays in receiving anticipated revenues with respect to such facilities and could have a material adverse effect on our business, financial condition and results of operations.
Delays in opening new or upgraded facilities could lead to increased costs and delays in receiving anticipated revenues with respect to such facilities and could have a material adverse effect on our business, financial condition and results of operations. 24 Table of Contents We may face disruption and other difficulties in integrating and managing facilities we have recently developed or acquired, or may develop or acquire in the future.
Hurricanes are common in the area in which our Mississippi property is located, and the severity of such natural disasters is unpredictable. In October 2020, Hurricane Zeta caused the temporary closure of the Silver Slipper and caused approximately $5 million of damage, most of which was covered by insurance.
The severity of such natural disasters is unpredictable. In October 2020, Hurricane Zeta caused the temporary closure of the Silver Slipper and caused approximately $5 million of damage, most of which was covered by insurance. In 2005, prior to the development of the Silver Slipper, Hurricanes Katrina and Rita caused significant damage in the Gulf Coast region.
The collection and use of personal information are governed by privacy laws and regulations enacted in the United States and other jurisdictions around the world.
The collection and use of personal information are governed by privacy laws and regulations enacted in the United States and other jurisdictions around the world. Privacy regulations continue to evolve and on occasion may be inconsistent from one jurisdiction to another.
We can give no assurance that changes in the scope of these projects will not increase the cost of the projects or extend their completion dates.
We may enter into similar arrangements with the general contractor for the permanent American Place facility. We can give no assurance that changes in the scope of these projects will not increase the cost of the projects or extend their completion dates.
We have purchase options on substantially all of our leased property, except for our corporate offices and the Grand Lodge Casino. It is either currently more advantageous for us to continue to lease rather than exercise such buyout options, or we have certain restrictions which only allow us to exercise the purchase option during certain future time periods.
It is either currently more advantageous for us to continue to lease rather than exercise such buyout options, or we have certain restrictions which only allow us to exercise the purchase option during certain future time periods. The obligations under the Notes and the Credit Facility are collateralized by a security interest in substantially all of our assets.
The loss of the services of any members of our senior management team could have a material adverse effect on our business, financial condition and results of operations.
The loss of the services of any members of our senior management team could have a material adverse effect on our business, financial condition and results of operations. We have faced increased challenges in attracting and retaining qualified employees, particularly in light of recent labor shortages.
We cannot assure you that we will be able to obtain additional equity or debt financing, if needed, or that we will be able to obtain such financing on favorable terms.
We cannot assure you that we will be able to obtain additional equity or debt financing, if needed, or that we will be able to obtain such financing on favorable terms. A failure to renovate or properly maintain our properties may put us at a competitive disadvantage.
We rely on proprietary and commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of customer information, such as payment card, employee information and other confidential or proprietary information. Our data security measures are reviewed and evaluated regularly; however, they might not protect us against increasingly sophisticated and aggressive threats.
We rely on proprietary and commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of customer information, such as payment card, employee information and other confidential or proprietary information.
Adverse weather conditions or road construction can deter our customers from traveling to our facilities or make it difficult for them to frequent our properties.
Our continued success depends upon our ability to draw customers from each of the geographic markets in which we operate. Adverse weather conditions or road construction can deter our customers from traveling to our facilities or make it difficult for them to frequent our properties.
The Temporary was designed so that construction of American Place on adjoining land should not materially disrupt business activity at The Temporary, but there is no certainty that this will be the case. Disruptions in operations at Bronco Billy’s or The Temporary could have an adverse effect on our business, financial condition and results of operations.
The temporary American Place facility was designed so that construction of its permanent facility on adjoining land should not materially disrupt business activity, but there is no certainty that this will be the case.
A failure to renovate or properly maintain our properties may put us at a competitive disadvantage. 24 Table of Contents We may face risks related to our ability to receive regulatory approvals required to complete certain acquisitions, mergers, joint ventures, and other developments, as well as other potential delays in completing certain transactions.
We may face risks related to our ability to receive regulatory approvals required to complete certain acquisitions, mergers, joint ventures, and other developments, as well as other potential delays in completing certain transactions. Our growth may be fueled, in part, by the acquisition of existing gaming and development properties.
Moreover, gasoline shortages or fuel price increases could make it more difficult for potential customers to travel to our properties and deter customers from visiting.
Moreover, gasoline shortages or fuel price increases could make it more difficult for potential customers to travel to our properties and deter customers from visiting. Our dockside gaming facility in Indiana is also subject to risks, in addition to those associated with land-based casinos, which could disrupt our operations.
Delays in the completion of the plans and specifications for our growth projects, including Chamonix and American Place, could delay completion of the projects.
This may result in insufficient funds to complete these projects or the need to raise additional capital. Delays in the completion of the plans and specifications for our growth projects, including Chamonix and the permanent American Place facility, could delay completion of the projects.
We regularly evaluate opportunities for acquisition and development of new properties. We could face significant challenges in managing and integrating our expanded or combined operations and any other properties we may develop or acquire, particularly in new competitive markets.
We could face significant challenges in managing and integrating our expanded or combined operations and any other properties we may develop or acquire, particularly in new competitive markets. The integration of properties we may develop or acquire will require the dedication of management resources that may temporarily divert attention from our day-to-day business.
We may face disruption and other difficulties in integrating and managing facilities we have recently developed or acquired, or may develop or acquire in the future. We may face certain challenges as we integrate the operational and administrative systems of recently developed or acquired facilities into our business.
We may face certain challenges as we integrate the operational and administrative systems of recently developed or acquired facilities into our business. As a result, the realization of anticipated benefits may be delayed or substantially reduced.
The obligations under the Notes and the Credit Facility are collateralized by a security interest in substantially all of our assets. The Notes contain representations and warranties, financial covenants, and restrictions on dividends customary for notes of this type.
The Notes contain representations and warranties, financial covenants, and restrictions on dividends customary for notes of this type.
“Business — Operating Properties — American Place / The Temporary .” We also have a finance lease at our Rising Star Casino Resort with an outstanding balance of $2.8 million.
The Notes and the Credit Facility are summarized in Note 6 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data.” We also have a finance lease at our Rising Star Casino Resort with an outstanding balance of $2.2 million.
The gaming industry is characterized by an increasingly high degree of competition among a large number of participants.
You could lose all or part of your investment. ​ Risks Related to our Business and Operations We face significant competition from other gaming and entertainment operations. The gaming industry is characterized by an increasingly high degree of competition among a large number of participants.
There is no assurance that these projects will not be subject to additional restrictions, delays, or challenges. There is no assurance that our growth projects, including Chamonix and American Place, will be successful.
Completion of the permanent American Place facility could also be delayed by weather, labor shortages, supply chain issues or other construction delays. There is no assurance that construction projects such as the permanent American Place facility will not be subject to additional restrictions, delays, or challenges.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe believe that a substantial number of stockholders hold their common stock in “street name” or are otherwise beneficial holders whose shares of record are held by banks, brokers, and other financial institutions. Such holders are not included in the number of “registered holders” above. Dividend Policy We have not paid any dividends on our common stock to date.
Biggest changeWe believe that a substantial number of stockholders hold their common stock in “street name” or are otherwise beneficial holders whose shares of record are held by banks, brokers, and other financial institutions. Such holders are not included in the number of “registered holders” above. Dividend Policy We do not currently pay dividends on our common stock.
Our debt covenants restrict the payment of dividends and it is the present intention of our board of directors to retain all earnings, if any, for use in our business operations, debt reduction and growth initiatives, reinvesting such earnings on behalf of stockholders. Accordingly, we do not anticipate paying any dividends in the foreseeable future.
Our debt covenants currently restrict the payment of dividends and it is the present intention of our board of directors to retain all earnings, if any, for use in our business operations, debt reduction and growth initiatives, reinvesting such earnings on behalf of stockholders. Accordingly, we do not anticipate paying any dividends in the foreseeable future.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is traded on the Nasdaq Capital Market under the symbol “FLL.” On March 13, 2023, we had 72 “registered holders” of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is traded on the Nasdaq Capital Market under the symbol “FLL.” On March 13, 2024, we had 70 “registered holders” of record of our common stock.
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Item 6. [Reserved] ​ 35 Table of Contents
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Item 6. [Reserved] ​ 38 Table of Contents Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion of our results of operations and financial condition should be read together with the other financial information and consolidated financial statements included in this Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties.
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Our actual results could differ materially from the results anticipated in the forward-looking statements as a result of a variety of factors, including those discussed in Part I, Item 1A. “ Risk Factors ” and elsewhere in this Annual Report on Form 10-K.
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The results of operations for the periods reflected herein are not necessarily indicative of results that may be expected for future periods.
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Full House Resorts, Inc., together with its subsidiaries, may be referred to as “Full House,” the “Company,” “we,” “our” or “us.” Executive Overview Our primary business is the ownership and/or operation of casino and related hospitality and entertainment facilities, which includes offering, among other amenities, casino gambling, hotel accommodations, dining, golf, RV camping, sports betting, entertainment and retail outlets.
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We currently operate seven casinos: six on real estate that we own or lease and one located within a hotel owned by a third party. In December 2023, we began the phased opening of our newest property, Chamonix Casino Hotel (“Chamonix”), located adjacent to our existing Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado.
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We are currently designing our permanent American Place casino destination, which will be built adjacent to a temporary facility that we opened in Waukegan, Illinois, in February 2023. We are currently permitted to operate the temporary American Place facility until August 2027.
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Additionally, we benefit from seven permitted sports wagering “skins” – three in Colorado, three in Indiana, and one in Illinois. Other companies operate the active sports wagering websites under their brands, paying us a percentage of revenues, as defined, subject to annual minimum amounts.
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Regarding our remaining idle skins, we continue to evaluate whether to operate them ourselves or to have other third parties operate them. However, there is no certainty that we will be able to enter into agreements with replacement operators or successfully operate the skins ourselves.
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Starting in the first quarter of 2023, we updated our reportable segments to Midwest & South, West, and Contracted Sports Wagering. This change reflects a realignment within the Company as a result of our continued growth. See Note 11 for additional information about our segments, which are based primarily on geographic regions within the United States and type of income.
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The following table presents selected information concerning our segments: ​ ​ ​ Segments and Properties ​ Locations Midwest & South ​ ​ American Place * ​ Waukegan, IL (northern suburb of Chicago) Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Rising Star Casino Resort Rising Sun, IN (near Cincinnati) West ​ ​ Bronco Billy’s Casino and Chamonix Casino Hotel * Cripple Creek, CO (near Colorado Springs) Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) Incline Village, NV (North Shore of Lake Tahoe) Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering ​ ​ Three sports wagering websites (“skins”), one of which is currently idle ​ Colorado Three sports wagering websites (“skins”), two of which are currently idle ​ Indiana One sports wagering website (“skin”), commenced in August 2023 ​ Illinois __________ * The temporary American Place facility and Chamonix opened on February 17 and December 27, 2023, respectively. ​ 39 Table of Contents Our financial results are dependent upon the number of patrons that we attract to our properties and the amounts those guests spend per visit.
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While we provide credit at some of our casinos where permitted by gaming regulations, most of our revenues are cash-based, through customers wagering with cash or paying for non-gaming services with cash or credit cards. Our revenues are primarily derived from slot machines, but also include other gaming activities, including table games, keno and sports betting.
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In addition, we derive a significant amount of revenue from our hotels and our food and beverage outlets. We also derive revenues from our golf course and ferry boat service at Rising Star, our RV parks owned at Rising Star and managed at Silver Slipper, and retail outlets and entertainment.
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We often provide hotel rooms, food and beverages, entertainment, ferry usage, and golf privileges to customers on a complimentary basis; the value of such services is included as revenue in those categories, offset by contra-revenue in the casino revenue category.
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As a result, the casino revenues in our financial statements reflect patron gaming wins and losses, reduced by the retail value of complimentary services, the value of free play provided to customers, the value of points earned by casino customers that can be redeemed for services or free play, and adjustments for certain progressive jackpots offered by the Company.
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We set minimum and maximum betting limits for our slot machines and table games based on market conditions, customer demand and other factors. Our gaming revenues are derived from a broad base of guests that includes both high- and low-stakes players. At Silver Slipper, our sports book operations are in partnership with a company specializing in race and sports betting.
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At Rising Star, Bronco Billy’s, and American Place, we have contracted with other companies to operate our online sports wagering skins under their own brands in exchange for a percentage of revenues, as defined, subject to annual minimum amounts.
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Our operating results may also be affected by, among other things, overall economic conditions affecting the disposable income of our guests, weather conditions affecting access to our properties, achieving and maintaining cost efficiencies, taxation and other regulatory changes, and competitive factors, including but not limited to, additions and improvements to the competitive supply of gaming facilities, as well as pandemics and similar widespread health emergencies.
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We may experience significant fluctuations in our quarterly operating results due to seasonality, variations in gaming hold percentages and other factors. Consequently, our operating results for any quarter or year are not necessarily comparable and may not be indicative of results in future periods. Our market environment is highly competitive and capital-intensive.
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Nevertheless, there are significant restrictions and barriers to entry vis-à-vis opening new casinos in most of the markets in which we operate. We rely on the ability of our properties to generate operating cash flow to pay interest, repay debt, and fund maintenance and certain growth-related capital expenditures.
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We continuously focus on improving the operating margins of our existing properties through a combination of revenue growth and expense management. We also assess growth and development opportunities, which include capital investments at our existing properties, the development of new properties, and the acquisition of existing properties. Recent Developments Chamonix Casino Hotel.
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On December 27, 2023, we began the phased opening of Chamonix in Cripple Creek, Colorado. Designed to integrate with our adjacent Bronco Billy’s Casino, the combined gaming complex currently offers a large, modern casino; luxury hotel with approximately 300 guest rooms; 14 additional guest rooms located nearby; parking garage; meeting and entertainment facilities; high-end steakhouse; and two additional casual restaurants.
Added
When complete later this year, the destination will also include a spa, rooftop pool, and a new Italian restaurant. Chamonix is the only luxury casino hotel located near the Colorado Springs metropolitan area. ​ American Place.
Added
In February 2023, we opened our temporary American Place facility in Waukegan, Illinois, which we intend to operate while we design and construct the larger, permanent American Place facility. We recently received approvals to operate the temporary American Place facility until August 2027.
Added
It currently includes approximately 940 slot machines, 48 table games, a fine-dining restaurant, two additional restaurants, a center bar and a sportsbook.
Added
The permanent American Place facility is expected to include a world-class casino with a state-of-the-art sportsbook, a premium boutique hotel comprised of 20 luxurious villas, and various food and beverage outlets. ​ ​ 40 Table of Contents Key Performance Indicators We use several key performance indicators to evaluate the operations of our properties.
Added
These key operating measures are presented as supplemental disclosures because management uses these measures to better understand period-over-period fluctuations in our casino and hotel operating revenues and as a measure of our performance.
Added
These key performance indicators include the following and are disclosed in our discussions, where applicable, for certain jurisdictions on segment performance: Gaming revenue indicators: Slot coin-in is the gross dollar amount wagered in slot machines and table game drop is the total amount of cash or credit exchanged into chips at table games for use by our customers.
Added
Slot coin-in and table game drop are indicators of volume, and are monitored on a consolidated basis in relation to slot and table game win. Such metrics can be influenced by marketing activity and are not necessarily indicative of profitability trends. Slot win is the difference between customer wagers and customer winnings on slot machines.
Added
Table game hold is the difference between the amount of money or markers exchanged into chips and customer winnings paid. Slot win and table game hold percentages represent the relationship between slot win and coin-in and table game win and drop.
Added
Both the slot win and table game hold percentages are monitored on a consolidated basis in our evaluation of Company performance. Room revenue indicators: Hotel occupancy rate is an indicator of the utilization of our available rooms.
Added
Complimentary room sales, or the retail value of accommodations furnished to customers on a complimentary basis, are included in the calculation of the hotel occupancy rate. Adjusted EBITDA, Adjusted Segment EBITDA, Adjusted Segment EBITDA Margin and Adjusted Property EBITDA: Management uses Adjusted EBITDA as a measure of our performance.
Added
For a description of Adjusted EBITDA, see “ Non-GAAP Financial Measure .” We utilize Adjusted Segment EBITDA as the measure of segment profitability in assessing performance and allocating resources at the reportable segment level. For information regarding our operating segments, see Note 11 to the consolidated financial statements set forth in Part II, Item 8.
Added
“Financial Statements and Supplementary Data.” Additionally, we use Adjusted Segment EBITDA Margin, which is calculated by dividing Adjusted Segment EBITDA by the segment’s total revenues. Same-store Adjusted Segment EBITDA is Adjusted Segment EBITDA further adjusted to exclude the Adjusted Property EBITDA of properties that have not been in operation for a full year.
Added
Adjusted Property EBITDA is defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening expenses, certain impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, project development and acquisition costs, non-cash share-based compensation expense, and corporate-related costs and expenses that are not allocated to each property. 41 Table of Contents Results of Operations 2023 Compared to 2022 Consolidated operating results The following tables summarize our consolidated operating results for the years ended December 31, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ (In thousands) ​ December 31, ​ Increase / ​ 2023 2022 (Decrease) Revenues ​ $ 241,060 ​ $ 163,281 47.6 % Operating expenses ​ 242,222 ​ 150,598 60.8 % Operating (loss) income ​ (1,162) ​ 12,683 (109.2) % Interest and other non-operating expenses, net ​ 22,593 ​ 27,518 (17.9) % Income tax expense (benefit) ​ 1,149 ​ (31) 3,806.5 % Net loss ​ $ (24,904) ​ $ (14,804) 68.2 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ (In thousands) ​ December 31, ​ Increase / ​ 2023 2022 (Decrease) Casino revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ Slots ​ $ 148,363 ​ $ 99,490 49.1 % Table games ​ 28,122 ​ 13,535 107.8 % Other ​ 448 ​ 851 (47.4) % ​ ​ 176,933 ​ 113,876 55.4 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-casino revenues, net ​ ​ ​ ​ ​ ​ ​ ​ ​ Food and beverage ​ 33,980 ​ 26,494 28.3 % Hotel ​ 9,428 ​ 9,282 1.6 % Other ​ 20,719 ​ 13,629 52.0 % ​ ​ 64,127 ​ 49,405 29.8 % Total revenues ​ $ 241,060 ​ $ 163,281 47.6 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ Increase / (In thousands) 2023 ​ 2022 ​ (Decrease) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Slot coin-in $ 2,605,335 ​ ​ $ 1,837,852 ​ ​ 41.8 % Slot win (1) $ 191,556 ​ ​ $ 135,793 ​ ​ 41.1 % Slot hold percentage (2) ​ 7.4 % ​ ​ 7.4 % ​ — pts Table game drop $ 152,854 ​ ​ $ 76,130 ​ ​ 100.8 % Table game win (1) $ 28,372 ​ ​ $ 13,733 ​ ​ 106.6 % Table game hold percentage (2) ​ 18.6 % ​ ​ 18.0 % ​ 0.6 pts __________ (1) Does not reflect reductions in casino revenues from “discretionary comps.” For details on our customer loyalty programs, see Note 2 to the consolidated financial statements set forth in Part II, Item 8.
Added
“Financial Statements and Supplementary Data.” (2) The three-year averages for slot hold percentage and table game hold percentage were 7.4% and 18.3%, respectively.
Added
Longer-term hold percentages can vary due to a number of factors, including the addition of new properties like Chamonix and American Place, or changes in our game mix. 42 Table of Contents ​ The following discussion is based on our consolidated financial statements for the years ended December 31, 2023 and 2022. Revenues.
Added
Consolidated total revenues increased by 47.6% (or $77.8 million) in 2023, reflecting the February 2023 opening of American Place, which contributed $77.0 million during the year. This increase also reflects the termination of two sports wagering agreements in September 2023, which contributed $5.8 million in accelerated revenues for the year ended December 31, 2023.
Added
Excluding revenue contributions from American Place, total revenues increased $0.8 million (0.5%) when compared to 2022, despite lower gaming volumes in 2023. For more information, see “ Supplemental Information – Same-store Operating Results. ” Operating expenses.
Added
Consolidated operating expenses increased by 60.8% (or $91.6 million) in 2023, which was primarily due to the commencement of operations at American Place, including $23.7 million in selling, general and administrative costs, $23.6 million in depreciation and amortization, and $10.0 million of preopening costs for the year ended December 31, 2023.
Added
Operating expenses in 2023 also included $5.7 million of preopening costs related to the construction and opening of Chamonix. See further information within our reportable segments described below. Interest and other non-operating expense, net.
Added
Interest Expense Interest expense, net, consists of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended (In thousands) ​ December 31, ​ 2023 2022 Interest expense (excluding bond fee amortization and discounts/premiums) ​ $ 39,860 ​ $ 33,496 Amortization of debt issuance costs and discounts/premiums ​ 2,793 ​ 1,649 Capitalized interest ​ (15,938) ​ (10,802) Interest income and other ​ ​ (3,738) ​ ​ (1,355) ​ ​ $ 22,977 ​ $ 22,988 ​ Net interest expense for 2023 was relatively flat, reflecting an increase in capitalized interest related to the construction of Chamonix and additional interest income earned from our cash balances, which nearly offset an increase in interest expense due to additional borrowings in the first quarter of 2023.
Added
See Note 6 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data” for a more detailed discussion. Other non-operating expense, net In 2023, we had $0.4 million of other non-operating income, consisting of insurance settlement proceeds from hurricane damage at Silver Slipper in 2020.
Added
In 2022, we incurred $4.5 million of other non-operating expense, primarily consisting of debt modification costs related to our offering of $100 million of additional notes in February 2022. Income taxes. Our effective income tax rates for the years ended December 31, 2023 and 2022 were (4.8%) and 0.2%, respectively.
Added
Our tax rates differ from the statutory rate of 21.0% primarily due to changes in our valuation allowance and items that are permanently treated differently for GAAP and tax purposes.
Added
During 2023, we continued to provide a valuation allowance against our deferred tax assets (“DTAs”), net of any available deferred tax liabilities, as applicable, based on our analysis of the timing of reversal of such deferred taxes. For 2023, the valuation allowance was $24.0 million, compared to $15.2 million for 2022.
Added
In future years, if it is determined that we meet the more-likely-than-not threshold of utilizing our DTAs, then we may reverse some or all of our valuation allowance. 43 Table of Contents We do not expect to pay any federal income taxes or receive any federal tax refunds related to our 2023 results.
Added
Due to the commencement of business operations at American Place, we expect to pay a state income tax in Illinois of $0.5 million. We used net operating loss carryforwards from previous years to offset federal taxable income generated in 2023.
Added
Due to the level of uncertainty regarding sufficient prospective income as measured under GAAP, we maintain a valuation allowance against our DTAs, as mentioned above. See Note 8 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data” for a more detailed discussion.
Added
Operating Results — Reportable Segments We manage our casinos based primarily on geographic regions within the United States and type of income. For more information, please refer to our earlier discussion within the “ Executive Overview ” section.
Added
The following table presents detail by segment of our consolidated revenues and Adjusted EBITDA (see “ Non-GAAP Financial Measure ” for more information).
Added
Additionally, management uses Adjusted Segment EBITDA as its measure of segment profitability in accordance with GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Increase / ​ 2023 2022 (Decrease) Revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ Midwest & South $ 192,358 ​ $ 119,950 60.4 % West 35,888 ​ 36,135 (0.7) % Contracted Sports Wagering ​ ​ 12,814 ​ ​ 7,196 ​ 78.1 % ​ $ 241,060 ​ $ 163,281 47.6 % Adjusted Segment EBITDA and Adjusted EBITDA ​ ​ ​ ​ ​ ​ ​ ​ ​ Midwest & South $ 39,028 ​ $ 26,376 48.0 % West 2,408 ​ 4,220 (42.9) % Contracted Sports Wagering ​ ​ 11,663 ​ ​ 7,127 ​ 63.6 % Adjusted Segment EBITDA 53,099 ​ 37,723 40.8 % Corporate (4,542) ​ (5,589) (18.7) % Adjusted EBITDA $ 48,557 ​ $ 32,134 51.1 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Adjusted Segment EBITDA Margin ​ ​ ​ ​ ​ ​ ​ ​ ​ Midwest & South ​ ​ 20.3 % ​ 22.0 % (1.7) pts West ​ ​ 6.7 % ​ 11.7 % (5.0) pts Contracted Sports Wagering ​ ​ 91.0 % ​ 99.0 % (8.0) pts ​ 44 Table of Contents Supplemental Information — Same-store Operating Results The following table presents the financial results of our Midwest & South operations on a same-store basis for the years ended December 31, 2023 and 2022 for revenues and Adjusted Segment EBITDA; see “ Adjusted EBITDA, Adjusted Segment EBITDA, Adjusted Segment EBITDA Margin and Adjusted Property EBITDA ” for additional information.
Added
Same-store operations exclude results of new and acquired operating segments that have not been in operations for longer than a year, starting from the date of commencement or acquisition through the end of the reporting period.
Added
Accordingly, for Midwest & South, we have excluded the results of American Place for periods subsequent to its commencement of operations. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Increase / ​ 2023 2022 (Decrease) Midwest & South same-store total revenues (1) ​ $ 115,371 ​ $ 119,950 ​ (3.8) % American Place ​ 76,987 ​ — N.M.
Added
Midwest & South total revenues ​ $ 192,358 ​ $ 119,950 60.4 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Midwest & South same-store Adjusted Segment EBITDA (1) ​ $ 20,619 ​ $ 26,376 ​ (21.8) % American Place ​ 18,409 ​ — N.M.
Added
Midwest & South Adjusted Segment EBITDA ​ $ 39,028 ​ $ 26,376 48.0 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Midwest & South same-store Adjusted Segment EBITDA margin (1) ​ ​ 17.9 % ​ 22.0 % (4.1) pts American Place ​ ​ 23.9 % ​ — % 23.9 pts Midwest & South Adjusted Segment EBITDA margin ​ ​ 20.3 % ​ 22.0 % (1.7) pts __________ N.M.
Added
(1) Same-store operations exclude results from American Place, which opened on February 17, 2023. ​ 45 Table of Contents The following table presents the financial results of our Contracted Sports Wagering operations on a same-store basis for the years ended December 31, 2023 and 2022 for revenues and Adjusted Segment EBITDA; see “ Adjusted EBITDA, Adjusted Segment EBITDA, Adjusted Segment EBITDA Margin and Adjusted Property EBITDA ” for additional information.
Added
Same-store operations exclude results of new and acquired operating segments that have not been in operations for longer than a year, starting from the date of commencement or acquisition through the end of the reporting period. Accordingly, for Contracted Sports Wagering, we have excluded the results in Illinois for periods subsequent to its contractual commencement of revenue payments.
Added
For comparability, we also excluded accelerated revenues due to contract terminations from same-store operations. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Increase / ​ 2023 2022 (Decrease) Contracted Sports Wagering same-store total revenues (1) ​ $ 4,773 ​ $ 5,555 ​ (14.1) % Accelerated revenues due to contract terminations (2) ​ ​ 5,794 ​ ​ 1,641 ​ 253.1 % Illinois ​ 2,247 ​ — N.M.
Added
Contracted Sports Wagering total revenues ​ $ 12,814 ​ $ 7,196 78.1 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contracted Sports Wagering same-store Adjusted Segment EBITDA (1) ​ $ 3,717 ​ $ 5,486 ​ (32.2) % Accelerated revenues due to contract terminations (2) ​ ​ 5,794 ​ ​ 1,641 ​ 253.1 % Illinois ​ 2,152 ​ — N.M.
Added
Contracted Sports Wagering Adjusted Segment EBITDA ​ $ 11,663 ​ $ 7,127 63.6 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contracted Sports Wagering same-store Adjusted Segment EBITDA margin (1) ​ ​ 77.9 % ​ 98.8 % (20.9) pts Illinois ​ ​ 95.8 % ​ — % 95.8 pts Contracted Sports Wagering Adjusted Segment EBITDA margin ​ ​ 91.0 % ​ 99.0 % (8.0) pts __________ N.M.
Added
Not meaningful. (1) Same-store operations exclude results from Illinois, which contractually commenced on August 15, 2023. For enhanced comparability, we also excluded accelerated revenues due to contract terminations from same-store operations. (2) For enhanced comparability, we also excluded accelerated revenues due to contract terminations from same-store operations.
Added
Such adjustments reflect two sports skins that ceased operations in the third quarter of 2023, and two sports skins that ceased operations in the second quarter of 2022. ​ 46 Table of Contents Midwest & South Our Midwest & South segment includes Silver Slipper Casino and Hotel, Rising Star Casino Resort and American Place, which opened in Waukegan, Illinois, in February 2023.
Added
Compared to 2022, total revenues in 2023 increased by 60.4% (or $72.4 million), primarily due to the opening of American Place. Excluding results from American Place, same-store revenues declined by 3.8% (or $4.6 million), primarily due to lower casino revenue during the year.
Added
Reflecting the February 2023 opening of American Place, casino revenue increased by 78.0% (or $63.7 million), led by a 70.2% increase in slot revenue (or $50.0 million). Table games revenue increased by 146.8% (or $14.1 million).
Added
Excluding results from American Place, same-store casino revenue declined by 9.9% (or $8.0 million), primarily due to lower slot and table games hold percentages at Silver Slipper and changes in promotions versus the prior year.
Added
To a lesser extent, same-store slot revenue for 2023 was adversely impacted by lower slot volumes at Rising Star versus the prior year, likely due to the opening of a new, competing racetrack casino in September 2022 in Northern Kentucky. Non-casino revenue increased by 22.7% (or $8.7 million), largely due to increases in food and beverage revenue.
Added
Food and beverage revenue rose 29.7% (or $7.0 million), including $3.8 million generated by American Place. Non-casino revenue also benefited from $1.4 million in ATM and related surcharge income at American Place during 2023. Hotel revenues for the segment remained relatively flat during the year, as the temporary American Place facility does not have hotel operations.
Added
Adjusted Segment EBITDA increased by 48.0% (or $12.7 million) from the prior year, reflecting the February 2023 opening of American Place, which generated $18.4 million of Adjusted Property EBITDA, offsetting a same-store Adjusted Segment EBITDA decline of $5.8 million (21.8%) during 2023.
Added
Same-store operations were primarily affected by declines in casino revenues and higher operating costs at Silver Slipper, such as property insurance, as well as increases in labor expenses generally. Of note, the temporary American Place facility was not operating at full capacity during 2023.
Added
American Place operated only one of its major restaurants in the first quarter, followed by a second restaurant that opened in April 2023. In February 2024, its high-end restaurant opened, thus completing the temporary American Place facility. Also, in September 2023, an on-site sportsbook commenced operations.
Added
West Our West segment includes Grand Lodge, Stockman’s Casino, Bronco Billy’s Casino and Hotel, and Chamonix Casino Hotel, which opened on December 27, 2023. The market in Cripple Creek, Colorado, is seasonal, favoring the summer months. Our Nevada operations have historically been seasonal, with the summer months accounting for a disproportionate share of annual revenues.
Added
Additionally, snowfall levels during the winter months can often affect operations, as Grand Lodge is located near several major ski resorts.
Added
While Grand Lodge typically benefits from a “good” snow year, resulting in extended periods of operation at the nearby ski areas, excessive snow levels can also result in challenging driving conditions or the closure of roads leading to the property. Total revenues decreased by 0.7% (or $0.2 million), primarily due to planned business disruptions to accommodate the construction of Chamonix.
Added
These significant construction disruptions included temporarily-reduced gaming and restaurant capacity at Bronco Billy’s, as well as the absence of all on-site hotel rooms and on-site self-parking until Chamonix’s opening at the end of 2023.
Added
To alleviate the lack of on-site parking during 2022 and nearly all of 2023, Bronco Billy’s offered, and incurred the cost of offering, complimentary valet parking, as well as a free shuttle service to an off-site parking lot. Casino revenue decreased by 2.0% (or $0.7 million), largely due to the construction disruptions at Bronco Billy’s mentioned above.
Added
Slot revenue declined by 3.9% (or $1.1 million), despite an increase in slot hold percentages at Bronco Billy’s and Grand Lodge.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] 35 ​ ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 36 ​ ​ Item 7A. Quantitative and Qualitative Disclosures About Market Risk 50 ​ ​ Item 8. Financial Statements and Supplementary Data 51 ​ ​
Biggest changeItem 6. [Reserved] 38 ​ ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 39 ​ ​ Item 7A. Quantitative and Qualitative Disclosures About Market Risk 54 ​ ​ Item 8. Financial Statements and Supplementary Data 55 ​ ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeItem 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion of our results of operations and financial condition should be read together with the other financial information and consolidated financial statements included in this Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties.
Biggest changeItem 7. “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” of this Annual Report on Form 10-K.
Removed
Our actual results could differ materially from the results anticipated in the forward-looking statements as a result of a variety of factors, including those discussed in Part I, Item 1A. “ Risk Factors ” and elsewhere in this Annual Report on Form 10-K.
Added
These forward-looking statements speak only as of the date on which this statement is made, and we undertake no obligation to update or revise any forward-looking statements as a result of future developments, events or conditions, except as required by law.
Removed
The results of operations for the periods reflected herein are not necessarily indicative of results that may be expected for future periods.
Added
New risks emerge from time to time and it is not possible for us to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ significantly from those forecast in any forward-looking statements.
Removed
Full House Resorts, Inc., together with its subsidiaries, may be referred to as “Full House,” the “Company,” “we,” “our” or “us.” Executive Overview Our primary business is the ownership and/or operation of casino and related hospitality and entertainment facilities, which includes offering casino gambling, hotel accommodations, dining, golfing, RV camping, sports betting, entertainment and retail outlets, among other amenities.
Added
You should also be aware that while we communicate from time to time with securities analysts, we do not disclose to them any material non-public information, internal forecasts or other confidential business information. Therefore, you should not assume that we agree with any statement or report issued by any analyst, irrespective of the content of the statement or report.
Removed
We currently operate six casinos: five on real estate that we own or lease and one located within a hotel owned by a third party. Construction continues for a seventh property, Chamonix Casino Hotel (“Chamonix”), adjacent to our existing Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado.
Added
To the extent that reports issued by securities analysts contain projections, forecasts or opinions, those reports are not our responsibility and are not endorsed by us. ​ ​ 3 Table of Contents Summary of Risk Factors ​ The following is a summary of the risk factors discussed in Part I, Item 1A. “ Risk Factors ” of this Form 10-K.
Removed
We are also designing our permanent American Place casino destination, which will be built adjacent to a temporary facility that we opened in February 2023 named The Temporary by American Place (“The Temporary”) (see Note 12 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data”).
Added
This summary should be read in conjunction with those Risk Factors and should not be relied upon as an exhaustive summary of the material risks facing our business. ​ Risks Related to our Business and Operations ● We face significant competition from other gaming and entertainment operations. ● We may face revenue declines if discretionary consumer spending drops, including due to an economic downturn. ● We cannot assure you that any of our contracted sports betting parties, through the use of our permitted website “skins,” will be able to compete effectively, that our contracted sports parties will have the ability and/or willingness to sustain sports betting operations should they experience an extended period of unprofitability, or that we will have the ability to replace existing partners or vendors on similar terms as our existing contractual revenue minimums. ● Marine transportation is inherently risky, and insurance may be insufficient to cover losses that may occur to our assets or result from our ferry boat operations. ● Our Mississippi casino hotel and Illinois casino operations currently generate a significant percentage of our revenues and Adjusted EBITDA.
Removed
We intend to operate The Temporary until the opening of American Place. Additionally, we benefit from seven permitted sports wagering “skins” – three in Colorado, three in Indiana, and one in Illinois. Other companies operate or will operate these online sports wagering websites under their brands, paying us a percentage of revenues, as defined, subject to annual minimum amounts.
Added
Our ability to meet our operating and debt service requirements is dependent, in part, upon the continued success of those properties. ● We derive our revenues and operating income from our properties located in Mississippi, Colorado, Indiana, Nevada and Illinois, and are especially subject to certain risks, including economic and competitive risks, associated with the conditions in those areas and in the states from which we draw patrons. ● Some of our operations are located on leased property.
Removed
In addition to our Contracted Sports Wagering segment, we view each of the states that we operate in as distinct operating segments.
Added
If the lessor of the Grand Lodge Casino exercises its buyout rights or fails to extend the lease, or if we default on this or certain of our other leases, the applicable lessors could terminate the affected leases and we could lose possession of the affected casino. ● A prolonged closure of our casinos would negatively impact our ability to service our debt. ● Adverse weather conditions, road construction, gasoline shortages and other factors affecting our facilities and the areas in which we operate could make it more difficult for potential customers to travel to our properties and deter customers from visiting our properties. ● Our results of operations and financial condition could be materially adversely affected by the occurrence of natural disasters, including as a result of climate change, such as hurricanes, floods, wildfires, pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases such as the coronavirus pandemic, or other catastrophic events, including war, terrorism and gun violence. ● Several of our properties, including Silver Slipper, Chamonix, Bronco Billy’s and Rising Star, are accessed by our customers via routes that have few alternatives. ● We may incur property and other losses that are not adequately covered by insurance, including adequate levels of Weather Catastrophe Occurrence/Named Windstorm, Flood and Earthquake insurance coverage for our properties. ● We depend on our key personnel and our ability to attract and retain employees. ● Higher wage and benefit costs could adversely affect our business. ● Rising operating costs at our gaming properties could have a negative impact on our business. ● We face the risk of fraud and cheating. ● Win rates for our gaming operations depend on a variety of factors, some beyond our control. ● The concentration and evolution of the slot machine manufacturing industry could impose additional costs on us. ● Our business may be adversely affected by legislation prohibiting tobacco smoking. ● We rely on, among other things, trademarks, licenses, confidentiality procedures, and contractual provisions to protect our intellectual property rights and we may be unable to protect or may not be successful in protecting our intellectual property rights. ● Our commercial success depends upon us avoiding the infringement of intellectual property rights owned by others and any such infringements, including those that are inadvertent, may have a material adverse effect on our business. ● We are subject to risks related to corporate social responsibility and reputation. ​ 4 Table of Contents Risks Related to Development and Growth Opportunities ● We are engaged from time to time in one or more construction and development projects, such as Chamonix and American Place, and many factors could prevent us from completing them as planned. ● The construction costs for our growth projects, including Chamonix and American Place, may exceed budgeted amounts plus contingencies.
Removed
Our portfolio consists of the following: ​ ​ ​ Segments and Properties ​ Locations Colorado ​ ​ Bronco Billy’s Casino and Hotel Cripple Creek, CO (near Colorado Springs) Chamonix Casino Hotel (under construction) ​ Cripple Creek, CO (near Colorado Springs) Illinois ​ ​ The Temporary by American Place (opened on February 17, 2023) and American Place (under development) ​ Waukegan, IL (northern suburb of Chicago) Indiana ​ ​ Rising Star Casino Resort Rising Sun, IN (near Cincinnati) Mississippi ​ ​ Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Nevada ​ ​ Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) Incline Village, NV (North Shore of Lake Tahoe) Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering ​ ​ Three sports wagering websites (“skins”) ​ Colorado Three sports wagering websites (“skins”) ​ Indiana One sports wagering website (“skin”), expected to commence Spring 2023 ​ Illinois ​ 36 Table of Contents Our financial results are dependent upon the number of patrons that we attract to our properties and the amounts those guests spend per visit.
Added
This may result in insufficient funds to complete these projects or the need to raise additional capital. ● There is no assurance that any growth projects, such as American Place, will not be subject to additional regulatory restrictions, delays, or challenges. ● A lawsuit was filed by an unsuccessful bidder for the Waukegan casino license, which could also have a negative impact on the development of our permanent American Place facility. ● There is no assurance that our growth projects, including Chamonix and American Place, will be successful. ● Failure to comply with the terms of our construction disbursement agreement related to Chamonix could limit our access to funds. ● We face a number of challenges prior to opening new or upgraded facilities. ● We may face disruption and other difficulties in integrating and managing facilities we have recently developed or acquired, or may develop or acquire in the future. ● The construction of Chamonix and the permanent American Place facility may inconvenience customers and disrupt business activity at our adjoining casino facilities. ● The permanent American Place facility, additional growth projects or potential enhancements at our properties may require us to raise additional capital. ● The casino, hotel and resort industry is capital intensive, and we may not be able to finance expansion and renovation projects, which could put us at a competitive disadvantage. ● We may face risks related to our ability to receive regulatory approvals required to complete certain acquisitions, mergers, joint ventures, and other developments, as well as other potential delays in completing certain transactions. ● If we fail to obtain necessary government approvals in a timely manner, or at all, it can adversely impact our various expansion, development, investment and renovation projects. ● Insufficient or lower-than-expected results generated from our new developments and acquired properties may negatively affect our operating results and financial condition. ​ Risks Related to our Indebtedness ● Our significant indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations. ● The indenture governing the Notes and the Credit Facility impose restrictive covenants and limitations that could significantly affect our ability to operate our business and lead to events of default if we do not comply with the covenants. ● To service our indebtedness, we will require a significant amount of cash.
Removed
While we provide credit at some of our casinos where permitted by gaming regulations, most of our revenues are cash-based, through customers wagering with cash or paying for non-gaming services with cash or credit cards. Our revenues are primarily derived from slot machines, but also include other gaming activities, including table games, keno and sports betting.
Added
Our ability to generate cash depends on many factors beyond our control. ● We may not be able to generate sufficient cash flows to service all of our indebtedness and fund our operating expenses, working capital needs and capital expenditures, and we may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful. ● We depend on our subsidiaries for certain dividends, distributions and repayment of our indebtedness, including the Notes and any borrowings under the Credit Facility. ● Our ability to obtain additional financing on commercially reasonable terms may be limited. ● The obligations under the Notes and the Credit Facility are collateralized by a security interest in substantially all of our assets.
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In addition, we derive a significant amount of revenue from our hotels and our food and beverage outlets. We also derive revenues from our golf course and ferry boat service at Rising Star, our RV parks owned at Rising Star and managed at Silver Slipper, and retail outlets and entertainment.
Added
If we default on those obligations, the holders of the Notes and lenders under the Credit Facility could foreclose on our assets.
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We often provide hotel rooms, food and beverages, entertainment, ferry usage, and golf privileges to customers on a complimentary basis; the value of such services is included as revenue in those categories, offset by contra-revenue in the casino revenue category.
Added
In addition, the existence of these security interests may adversely affect our financial flexibility. ● We and our subsidiaries may still be able to incur substantially more debt, including subordinated debt, which could further exacerbate the risks described above. ​ 5 Table of Contents Risks Related to our Legal and Regulatory Environment ● We face extensive regulation from gaming and other regulatory authorities and the cost of compliance or failure to comply with such regulations may adversely affect our business and results of operations. ● Changes in legislation and regulation of our business could have an adverse effect on our financial condition, results of operations and cash flows. ● Stockholders may be required to dispose of their shares of our common stock if they are found unsuitable by gaming authorities. ● We are subject to environmental laws and potential exposure to environmental liabilities. ● We are subject to litigation which, if adversely determined, could cause us to incur substantial losses. ● Our ferry boat service is highly regulated, which can adversely affect our operations. ​ Risks Related to Technology ● Our gaming operations rely heavily on technology services and an uninterrupted supply of electrical power.
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As a result, the casino revenues in our financial statements reflect patron gaming wins and losses, reduced by the retail value of complimentary services, the value of free play provided to customers, the value of points earned by casino customers that can be redeemed for services or free play, and adjustments for certain progressive jackpots offered by the Company.
Added
If we experience damage or service interruptions, we may have to cease some or all of our operations, which will result in a decrease in revenue. ● Our information technology and other systems are subject to cybersecurity risk, misappropriation of customer information and other breaches of information security. ​ General Risks ● Our ability to utilize our net operating loss (“NOL”) carryforwards and certain other tax attributes may be limited. ● The market price for our common stock may be volatile, and investors may not be able to sell their stock at a favorable price, or at all. ● The exercise of outstanding options to purchase common stock may result in substantial dilution and may depress the trading price of our common stock. ​ ​ 6 Table of Contents PART I ​ ​
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We set minimum and maximum betting limits for our slot machines and table games based on market conditions, customer demand and other factors. Our gaming revenues are derived from a broad base of guests that includes both high- and low-stakes players. At Silver Slipper, our sports book operations are in partnership with a company specializing in race and sports betting.
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At Rising Star, Bronco Billy’s, and The Temporary/American Place, we have contracted with other companies to operate our online sports wagering skins under their own brands in exchange for a percentage of revenues, as defined, subject to annual minimum amounts.
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Our operating results may also be affected by, among other things, overall economic conditions affecting the disposable income of our guests, weather conditions affecting access to our properties, achieving and maintaining cost efficiencies, taxation and other regulatory changes, and competitive factors, including but not limited to, additions and improvements to the competitive supply of gaming facilities, as well as pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases such as the coronavirus.
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We may experience significant fluctuations in our quarterly operating results due to seasonality, variations in gaming hold percentages and other factors. Consequently, our operating results for any quarter or year are not necessarily comparable and may not be indicative of results in future periods. Our market environment is highly competitive and capital-intensive.
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Nevertheless, there are significant restrictions and barriers to entry vis-à-vis opening new casinos in most of the markets in which we operate. We rely on the ability of our properties to generate operating cash flow to pay interest, repay debt, and fund maintenance and certain growth-related capital expenditures.
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We continuously focus on improving the operating margins of our existing properties through a combination of revenue growth and expense management. We also assess growth and development opportunities, which include capital investments at our existing properties, the development of new properties, and the acquisition of existing properties. Recent Developments American Place .
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In December 2021, we were selected by the IGB to develop and operate American Place, our proposal for a casino and entertainment destination in Waukegan, Illinois. While the larger, more lavish American Place facility is under construction, we will operate a temporary casino facility, aptly named The Temporary.
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Opened in February 2023, The Temporary was designed to include approximately 1,000 slot machines, 50 table games, a fine-dining restaurant, two additional restaurants, and a center bar.
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The permanent American Place facility is expected to include a world-class casino with a state-of-the-art sportsbook; a premium boutique hotel comprised of twenty luxurious villas; a 1,500-seat live entertainment venue; and various food and beverage outlets. ​ 37 Table of Contents To accommodate operations for The Temporary, as well as construction of the permanent American Place facility, we entered into a 99-year ground lease (the “Ground Lease”) with the City of Waukegan, Illinois (the “City”) in January 2023 for approximately 32 acres of land (the “City-Owned Parcel”), which is adjacent to a 10-acre parcel of land that we purchased in March 2022 for $7.5 million.
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Annual rent under the Ground Lease is the greater of (i) $3.0 million or (ii) 2.5% of Adjusted Gross Receipts (as defined) generated by either the Temporary or American Place. The Ground Lease is only terminable to the extent that the Development and Host Community Agreement with the City is terminated.
Removed
We have the right to purchase the City-Owned Parcel at any time during the term of the Ground Lease for $30 million, but if we do so prior to the opening of American Place, then we must continue to pay rent due to the City under the Ground Lease until the permanent casino is open.
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For more information, see Note 12 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data.” ​ Debt Financing. On February 21, 2023, we issued $40.0 million of Additional Notes. The Additional Notes were issued pursuant to an amended indenture governing the $410 million of Existing Notes.
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In connection with the issuance of the Additional Notes, we entered into a Fourth Supplemental Indenture with Wilmington Trust, National Association, as trustee, dated February 21, 2023 (as further amended, the “Indenture”).
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The Additional Notes are treated as a single series of senior secured debt securities with the Existing Notes and as a single class for all purposes under the Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. Proceeds from the offering, net of related expenses and discounts, were approximately $34 million.
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The Notes bear interest at a rate of 8.25% per year and mature on February 15, 2028. Interest on the Notes is payable on February 15 and August 15 in arrears of each year.
Removed
Also on February 21, 2023, we entered into a Second Amendment to the Credit Agreement with Capital One, National Association (“Capital One”), which, among other things, increased the amount of additional Indebtedness permitted under our Credit Agreement, dated as of March 31, 2021 (as further amended, the “Credit Agreement”), permitting the issuance of the Additional Notes.
Removed
The Notes are guaranteed, jointly and severally (such guarantees, the “Guarantees”), by each of the Company’s restricted subsidiaries (collectively, the “Guarantors”).
Removed
The Notes and the Guarantees are the Company’s and the Guarantor’s general senior secured obligations, subject to the terms of the Collateral Trust Agreement (as defined in the Indenture), ranking senior in right of payment to all of the Company’s and the Guarantor’s existing and future debt that is expressly subordinated in right of payment to the Notes and the Guarantees, if any, and ranking equally in right of payment with all of the Company’s and the Guarantors’ existing and future senior debt.
Removed
The Notes, together with borrowings under the Credit Facility, are equally and ratably secured by a first priority security interest in, subject to certain exceptions and limitations and the terms of the Collateral Trust Agreement, the Company’s and the Guarantors’ furniture, equipment, inventory, accounts receivable, other personal property and real property.
Removed
Additionally, the Notes (but not the borrowings under the Credit Facility) are secured by a first priority security interest in the securities accounts and the deposit accounts established pursuant to the Cash Collateral and Disbursement Agreement. Sports Wagering in Illinois. In May 2022, we signed a retail and mobile sports wagering contract for Illinois.
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Such operations are expected to commence in Spring 2023, pending the receipt of customary gaming approvals. We received an upfront fee of $5 million, which was capitalized and will be amortized over the eight-year term of the agreement that is expected to commence in Spring 2023.
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We will receive a percentage of revenues (as defined), subject to an annual minimum of $5 million. For more information, see Note 9 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data.” Sports Wagering in Colorado.
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In December 2022, we entered into a contract with a third-party to operate mobile sports wagering under our permitted third skin in Colorado. The 10-year agreement began its contractual term in March 2023. Such agreement replaces an unrelated operator that ceased operations in May 2022.
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In total, we have three sports wagering agreements in Colorado, for which we receive a percentage of revenues (as defined), subject to annual minimums totaling $3 million. For more information, see Note 9 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data.” 38 Table of Contents COVID-19 Pandemic Update .
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The COVID-19 pandemic continues to evolve and certain precautionary and stimulus measures, as well as other factors, have created economic uncertainty both in the United States and globally, as well as significant and prolonged volatility in, and disruption to, financial markets, labor markets and supply chains.
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Global supply chain disruptions and other world events have resulted in shipping delays, increased shipping costs, supply shortages, and inflationary pressures, including increases in prices for fuel, food, building materials, labor, and other items.
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These increased costs, labor shortages, and supply shortages continued to put additional constraints on our operating business and our construction projects for the year ended December 31, 2022.
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We do not know when, or if, these cost, labor, and supply chain issues will materially alleviate and, accordingly, they may continue to impact our existing business and our construction projects. ​ We believe that we have a strong balance sheet and sufficient liquidity in place.
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As of December 31, 2022, we had total cash and cash equivalents of $191.2 million, including $134.6 million of restricted cash reserved to fund the construction of Chamonix, and availability under our revolver.
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As noted above, we further augmented our liquidity in the first quarter of 2023 through the issuance of $40.0 million of Additional Notes, as well as the drawdown of $36.0 million under our Credit Facility. Key Performance Indicators We use several key performance indicators to evaluate the operations of our properties.
Removed
These key performance indicators include the following: Gaming revenue indicators: Slot coin-in is the gross dollar amount wagered in slot machines and table game drop is the total amount of cash or credit exchanged into chips at table games for use by our customers. Slot coin-in and table game drop are indicators of volume.
Removed
Slot win is the difference between customer wagers and customer winnings on slot machines. Table game hold is the difference between the amount of money or markers exchanged into chips at the tables and customer winnings paid. Slot win and table game hold percentages represent the relationship between slot win and coin-in and table game win and drop.
Removed
Room revenue indicators: Hotel occupancy rate is an indicator of the utilization of our available rooms. Complimentary room sales, or the retail value of accommodations furnished to customers free of charge, are included in the calculation of the hotel occupancy rate.
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Adjusted EBITDA, Adjusted Segment EBITDA and Adjusted Segment EBITDA Margin: Management uses Adjusted EBITDA as a measure of our performance. For a description of Adjusted EBITDA see “ Non-GAAP Measure .” We utilize Adjusted Segment EBITDA as the measure of segment profitability in assessing performance and allocating resources at the reportable segment level.
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For information regarding our operating segments, see Note 11 to the consolidated financial statements set forth in Part II, Item 8.
Removed
“Financial Statements and Supplementary Data.” Additionally, we use Adjusted Segment EBITDA Margin, which is calculated by dividing Adjusted Segment EBITDA by the property’s revenues. 39 Table of Contents Results of Operations 2022 Compared to 2021 Consolidated operating results The following tables summarize our consolidated operating results for the years ended December 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ (In thousands) ​ December 31, ​ Increase / ​ 2022 2021 (Decrease) Revenues ​ $ 163,281 ​ $ 180,159 (9.4) % Operating expenses ​ 150,598 ​ 142,605 5.6 % Operating income ​ 12,683 ​ 37,554 (66.2) % Interest and other non-operating expenses, net ​ 27,518 ​ 25,413 8.3 % Income tax (benefit) expense ​ (31) ​ 435 (107.1) % Net (loss) income ​ $ (14,804) ​ $ 11,706 (226.5) % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ (In thousands) ​ December 31, ​ Increase / ​ 2022 2021 (Decrease) Casino revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ Slots ​ $ 99,490 ​ $ 113,612 (12.4) % Table games ​ 13,535 ​ 13,749 (1.6) % Other ​ 851 ​ 3,070 (72.3) % ​ ​ 113,876 ​ 130,431 (12.7) % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-casino revenues, net ​ ​ ​ Food and beverage ​ 26,494 ​ 27,347 (3.1) % Hotel ​ 9,282 ​ 9,624 (3.6) % Other ​ 13,629 ​ 12,757 6.8 % ​ ​ 49,405 ​ 49,728 (0.6) % Total revenues ​ $ 163,281 ​ $ 180,159 (9.4) % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ Increase / (In thousands) 2022 ​ 2021 ​ (Decrease) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Slot coin-in $ 1,837,852 ​ ​ $ 1,951,311 ​ ​ (5.8) % Slot win (1) $ 135,793 ​ ​ $ 148,232 ​ ​ (8.4) % Slot hold percentage (2) ​ 7.4 % ​ ​ 7.6 % ​ (0.2) pts Table game drop $ 76,130 ​ ​ $ 77,104 ​ ​ (1.3) % Table game win (1) $ 13,733 ​ ​ $ 13,823 ​ ​ (0.7) % Table game hold percentage (2) ​ 18.0 % ​ ​ 17.9 % ​ 0.1 pts __________ (1) Does not reflect reductions in casino revenues from “discretionary comps.” For details on our customer loyalty programs, see Note 2 to the consolidated financial statements set forth in Part II, Item 8.
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“Financial Statements and Supplementary Data.” (2) The three-year averages for slot hold percentage and table game hold percentage were 7.5% and 17.9%, respectively. ​ 40 Table of Contents The following discussion is based on our consolidated financial statements for the years ended December 31, 2022 and 2021. Revenues.
Removed
Consolidated revenues decreased by 9.4% (or $16.9 million) in 2022, primarily due to a $14.9 million decline in slot revenues from lower volumes at our three properties in Colorado, Mississippi, and Indiana.
Removed
These lower volumes can be primarily attributed to the absence of government stimulus programs of the same scale as in 2021; construction disruptions at Bronco Billy’s to advance the completion of our Chamonix project; the launch of competing online sports wagering in Louisiana in January 2022; and adverse weather in December 2022 across several properties.
Removed
Additionally, our revenues were impacted by factors that are inherently hard to quantify, as discussed in the “Recent Developments – COVID-19 Pandemic Update ” section. These include inflationary pressures, which could affect the spending pattern of customers, as well as labor shortages for us to meet the demands of potential customers.
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“Other Non-casino Revenues” includes $7.2 million of revenue related to our contracted sports wagering agreements in 2022, compared to $5.9 million in 2021. See “Operating Results – Reportable Segments ” below for details. Operating expenses.
Removed
Consolidated operating expenses increased by 5.6% (or $8.0 million) in 2022, primarily due to $9.5 million of additional preopening costs for The Temporary and Chamonix and a $2.6 million increase to food and beverage costs. Such amounts were partially offset by a $4.0 million decrease in casino costs tied to lower volumes than in 2021, as noted above.
Removed
See further information within our reportable segments described below. Interest and other non-operating expense, net.
Removed
Interest Expense ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ Year Ended ​ ​ December 31, ​ 2022 2021 Interest expense (excluding bond fee amortization and premium) ​ $ 33,496 ​ $ 24,179 Amortization of debt issuance costs, discounts and premiums ​ 1,649 ​ 1,349 Capitalized interest ​ (10,802) ​ (1,871) Interest income and other ​ ​ (1,355) ​ ​ — ​ ​ $ 22,988 ​ $ 23,657 ​ Interest expense decreased marginally due to increases in capitalized interest related to construction of The Temporary and Chamonix projects, as well as interest income earned during the year.
Removed
Both items more than offset the increased interest expense that resulted from the February 2022 issuance of $100 million of additional senior secured notes. See Note 6 to the consolidated financial statements set forth in Part II, Item 8. “Financial Statements and Supplementary Data” for a more detailed discussion.
Removed
Other non-operating expense, net In 2022, we incurred $4.5 million of other non-operating expense, primarily consisting of debt modification costs related to our offering of $100 million of additional notes in February 2022.
Removed
In 2021, we incurred $1.8 million of other non-operating expense, which included $0.4 million for the extinguishment of prior debts and $1.3 million for the settlement of our former warrants. See Note 6 to the consolidated financial statements set forth in Part II, Item 8.
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“Financial Statements and Supplementary Data” for a more detailed discussion. 41 Table of Contents Income taxes. Our effective income tax rates for the years ended December 31, 2022 and 2021 were 0.2% and 3.6%, respectively.
Removed
Our tax rates differ from the statutory rate of 21.0% primarily due to changes in valuation allowance and items that are permanently treated differently for GAAP and tax purposes.
Removed
During 2022, we continued to provide a valuation allowance against our deferred tax assets (“DTAs”), net of any available deferred tax liabilities, as applicable, based on our analysis of the timing of reversal of such deferred taxes. For 2022, the valuation allowance was $15.2 million, compared to $9.9 million for 2021.
Removed
In future years, if it is determined that we meet the more likely than not threshold of utilizing our DTAs, then we may reverse some or all of our valuation allowance. We do not expect to pay any federal income taxes or receive any federal tax refunds related to our 2022 results.
Removed
We used net operating loss carryforwards from previous years to offset taxable income generated in 2022. Due to the level of uncertainty regarding sufficient prospective income as measured under GAAP, we maintain a valuation allowance against our DTAs, as mentioned above. See Note 8 to the consolidated financial statements set forth in Part II, Item 8.
Removed
“Financial Statements and Supplementary Data” for a more detailed discussion. Operating results — reportable segments We manage our casinos based primarily on geographic regions within the United States and type of income. For more information, please refer to our earlier discussion within the “ Executive Overview ” section.
Removed
The following table presents detail by segment of our consolidated revenues and Adjusted EBITDA (see “ Non-GAAP Measure ” for more information).
Removed
Additionally, management uses Adjusted Segment EBITDA as its measure of segment profitability in accordance with GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Increase / ​ 2022 2021 (Decrease) Revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ Mississippi $ 80,860 ​ $ 90,628 (10.8) % Indiana 39,090 ​ 41,435 (5.7) % Colorado 16,185 ​ 23,660 (31.6) % Nevada 19,950 ​ 18,516 7.7 % Contracted Sports Wagering ​ ​ 7,196 ​ ​ 5,920 ​ 21.6 % ​ $ 163,281 ​ $ 180,159 (9.4) % Adjusted Segment EBITDA and Adjusted EBITDA ​ ​ ​ ​ ​ ​ ​ ​ ​ Mississippi $ 19,488 ​ $ 29,843 (34.7) % Indiana 6,888 ​ 8,736 (21.2) % Colorado (688) ​ 5,545 (112.4) % Nevada 4,908 ​ 4,933 (0.5) % Contracted Sports Wagering ​ ​ 7,127 ​ ​ 5,890 ​ 21.0 % Adjusted Segment EBITDA 37,723 ​ 54,947 (31.3) % Corporate (5,589) ​ (7,733) (27.7) % Adjusted EBITDA $ 32,134 ​ $ 47,214 (31.9) % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Adjusted Segment EBITDA Margin ​ ​ ​ ​ ​ ​ ​ ​ ​ Mississippi ​ ​ 24.1 % ​ 32.9 % (8.8) pts Indiana ​ ​ 17.6 % ​ 21.1 % (3.5) pts Colorado ​ ​ (4.3) % ​ 23.4 % (27.7) pts Nevada ​ ​ 24.6 % ​ 26.6 % (2.0) pts Contracted Sports Wagering ​ ​ 99.0 % ​ 99.5 % (0.5) pts ​ ​ 42 Table of Contents Mississippi Our Mississippi segment consists of the Silver Slipper Casino and Hotel.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk. As a smaller reporting company during the year ended December 31, 2022, as defined by Rule 12b-2 of the Exchange Act, we are not required to provide the information required by this Item. ​ 50 Table of Contents
Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk. As a smaller reporting company during the year ended December 31, 2023, as defined by Rule 12b-2 of the Exchange Act, we are not required to provide the information required by this Item. ​ 54 Table of Contents

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