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Long-term Debt | 9 Months Ended
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Sep. 30, 2015
Long-term Debt |
Long-term Debt | 7. Long-term Debt Long-term debt, net of current maturities, is as follows:
|  | September 30, |  | December 31, |
|  | 2015 |  | 2014 |
|  |  |  | (Restated) |
|  | (in thousands) |
Senior secured credit facility |  | $ | 1,236,597 |  | $ | 807,500 |
$300 million 5.875% senior unsecured notes due November 1, 2021 |  | 300,000 |  | 300,000 |
Other long term obligations |  | 146,992 |  | 135,000 |
Capital leases |  | 28,897 |  | 25,137 |
|  | 1,712,486 |  | 1,267,637 |
Less current maturities of long-term debt |  | (87,801 | ) | (30,853 | )
Less discount on senior secured credit facility Term Loan B |  | (928 | ) | (1,056 | )
Less debt issuance costs, net of accumulated amortization of $11.4 million and $6.8 million, respectively |  | (24,944 | ) | (25,151 | )
|  | $ | 1,598,813 |  | $ | 1,210,577 |
The following is a schedule of future minimum repayments of long-term debt as of September 30, 2015 (in thousands):
Within one year |  | $ | 87,801 |
1-3 years |  | 163,388 |
3-5 years |  | 854,794 |
Over 5 years |  | 606,275 |
Total minimum payments |  | $ | 1,712,258 |
Senior Secured Credit Facility On April 28, 2015, the Company entered into an agreement to amend its senior secured credit facility. In August 2015, the amendment to the senior secured credit facility went into effect increasing the capacity under an existing five year revolver from $500 million to $633.2 million and increased the existing five year $500 million Term Loan A facility by $146.7 million. The seven year $250 million Term Loan B facility remained unchanged. At September 30, 2015, the Company’s senior secured credit facility had a gross outstanding balance of $1,236.6 million, consisting of a $601.0 million Term Loan A facility, a $245.6 million Term Loan B facility, and $390.0 million outstanding on the revolving credit facility. Additionally, at September 30, 2015, the Company had conditional obligations under letters of credit issued pursuant to the senior secured credit facility with face amounts aggregating $23.2 million, resulting in $220.0 million of available borrowing capacity as of September 30, 2015 under the revolving credit facility. Other Long Term Obligations Other long term obligations at September 30, 2015 of $147.0 million included $131.7 million related to the relocation fees for Hollywood Gaming at Dayton Raceway and Hollywood Gaming at Mahoning Valley Race Course, and $15.3 million related to the repayment obligation of a hotel and event center located near Hollywood Casino Lawrenceburg; all of which are more fully described below. Ohio Relocation Fees In June 2013, the Company finalized the terms of its memorandum of understanding with the State of Ohio, which included an agreement by the Company to pay a relocation fee in return for being able to relocate its existing racetracks in Toledo and Grove City to Dayton and Mahoning Valley, respectively. Upon opening of these two racinos in Ohio in the third quarter of 2014, the relocation fee for each new racino was recorded at the present value of the contractual obligation, which was calculated to be $75 million based on the 5% discount rate included in the agreement. The relocation fee for each facility is payable as follows: $7.5 million upon the opening of the facility and eighteen semi-annual payments of $4.8 million beginning one year from the commencement of operations. This obligation is accreted to interest expense at an effective yield of 5.0%. The amount included in interest expense related to this obligation was $1.6 million and $5.0 million for the three and nine months ended September 30, 2015, respectively. Event Center The City of Lawrenceburg Department of Redevelopment recently completed construction of a hotel and event center located less than a mile away from Hollywood Casino Lawrenceburg. Effective in mid-January 2015, by contractual agreement, a repayment obligation for the hotel and event center was assumed by a wholly-owned subsidiary of the Company in the amount of $15.3 million, which was financed through a loan with the City of Lawrenceburg Department of Redevelopment. The Company is obligated to make annual payments on the loan of approximately $1 million for twenty years beginning January 2016. This obligation is accreted to interest expense at its effective yield of 3.0%. The amount included in interest expense related to this obligation was $0.1 million and $0.3 million for the three and nine months ended September 30, 2015, respectively. Capital Leases Capital leases are primarily comprised of a ten year corporate airplane lease that expires in August 2016, which has a ten year renewal option. The lease obligation has been recorded at the lessor’s initial cost of the plane, of $24.9 million at both September 30, 2015 and December 31, 2014, since the agreement has broad based default provisions that could result in potential damages equal to this amount. The lease obligation was classified as a capital lease based on the provisions of ASC 840 “Leases” which requires that the remedies for events of default under the provision described in this scenario be included in the minimum lease payment calculation for purposes of lease classification and that the probability of such an event of default will occur is not relevant to this determination. Debt Issuance Costs As discussed in Note 4, the Company elected to early adopt accounting guidance issued in April 2015 to simplify the presentation of debt issuance costs. This change in accounting principle was implemented retrospectively as of March 31, 2015. Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense using the effective interest method over the contractual term of the underlying indebtedness. The Company has reclassified debt issuance costs as a direct reduction to the related debt obligation in its condensed consolidated balance sheets as of September 30, 2015 and December 31, 2014. Covenants The Company’s senior secured credit facility and $300 million 5.875% senior unsecured notes require it, among other obligations, to maintain specified financial ratios and to satisfy certain financial tests, including fixed charge coverage, interest coverage, senior leverage and total leverage ratios. In addition, the Company’s senior secured credit facility and $300 million 5.875% senior unsecured notes restrict, among other things, its ability to incur additional indebtedness, incur guarantee obligations, amend debt instruments, pay dividends, create liens on assets, make investments, engage in mergers or consolidations, and otherwise restrict corporate activities. At September 30, 2015, the Company was in compliance with all required financial covenants. The Company has received a waiver through March 15, 2016, from its lenders under its senior secured credit facility to file its financial statements with the SEC through the quarter ended September 30, 2015. Additionally, starting on February 8, 2016, the Company is required to pay an additional 25 basis points annually under its $300 million senior unsecured notes until the Company becomes current with its SEC filings.

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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