XML 58 R14.htm IDEA: XBRL DOCUMENT
v3.3.0.814

Long-Term Debt | 9 Months Ended
--- | ---
Sep. 30, 2015
Long-Term Debt [Abstract] |
Long-Term Debt | 7. LONG-TERM DEBT Long-term debt as of September 30, 2015 and December 31, 2014 consisted of the following:
|  | September 30, |  | December 31,
Amounts in thousands |  | 2015 |  | 2014
Credit agreement - Bank of Montreal |  | $ | 21,731 |  | $ | 16,383
Credit agreement - Casinos Poland |  |  | 2,103 |  |  | 3,446
Credit facility - Casinos Poland |  |  | 1,396 |  |  | 1,506
Capital leases - Casinos Poland |  |  | 22 |  |  | 108
Financing obligation - CDR land lease |  |  | 14,556 |  |  | 16,806
Total long-term debt |  | $ | 39,808 |  | $ | 38,249
Less current portion |  |  | (5,522) |  |  | (5,272)
Long-term portion |  | $ | 34,286 |  | $ | 32,977
The consolidated weighted average interest rate on all Company debt was 7.80% for the nine months ended September 30, 2015. In April 2015, the Company entered into two interest rate swap agreements to partially hedge the risk of future increases in the variable rate debt under the Company’s credit agreement with the Bank of Montreal (the “BMO Credit Agreement”). The outstanding balance for each of the interest rate swap agreements is CAD 10.7 million ($8.0 million based on the exchange rate in effect on September 30, 2015) at a Canadian Dollar Offered Rate (“CDOR”) of 3.92% and 3.89%, respectively. The interest rate swap agreements are not designated as hedges for accounting purposes. As a result, changes in fair value of the interest rate swaps are recognized in interest expense on the Company’s condensed consolidated statement of earnings (loss). The Company pays a floating interest rate on its remaining CAD 7.7 million ($5.7 million based on the exchange rate in effect on September 30, 2015) in borrowings under the BMO Credit Agreement, and the current interest rate is approximately 3.26%. The Company pays a weighted average interest rate of 3.41% on its borrowings under the CPL loan agreements. The weighted average interest rate on all Company debt is higher than the interest rates of the BMO Credit Agreement and the weighted average interest of 3.41% on the CPL loan agreements due to the CDR financing obligation, on which the Company pays an implicit interest rate of 10.0%, and the fair value impact of the interest rate swap agreements on interest expense. See Note 11 for additional information on the interest rate s wap agreements. Credit Agreement – Bank of Montreal In May 2012, the Company, through its Canadian subsidiaries, entered into the CAD 28.0 million credit agreement with the Bank of Montreal. On August 15, 2014, the Company, through its Canadian subsidiaries, entered into an amended and restated BMO Credit Agreement that increased the Company’s borrowing capacity to CAD 39.1 million. As of September 30, 2015, the Company had borrowed CAD 33.9 million, of which the outstanding balance was CAD 29.1 million ($21.7 million based on the exchange rate in effect on September 30, 2015) and the Company had approximately CAD 5.2 million ($3.9 million based on the exchange rate in effect on September 30, 2015) available under the BMO Credit Agreement. The outstanding borrowings cannot be re-borrowed once they are repaid. The Company has used borrowings under the BMO Credit Agreement primarily to repay the Company’s mortgage loan related to the Edmonton property, pay for the additional 33.3% investment in CPL and pay for development costs related to the REC project (Note 3). The Company can also use the proceeds to pursue the development or acquisition of new gaming opportunities and for general corporate purposes. Borrowings bear interest at fixed rates or at BMO’s floating rate plus a margin. Any funds not drawn down under the BMO Credit Agreement are subject to standby fees ranging from 0.50% to 0.75% payable quarterly in arrears. Standby fees of less than CAD 0.1 million (less than $0.1 million based on the exchange rate in effect on September 30, 2015) were recorded as general and administrative expense in the condensed consolidated statement of earnings (loss) for each of the three and nine months ended September 30, 2015 and September 30, 2014. The BMO Credit Agreement has a term of five years through August 2019 and is guaranteed by the Company. The shares of the Company’s subsidiaries in Edmonton and Calgary and the Company's 75% interest in CDR are pledged as collateral for the BMO Credit Agreement. The BMO Credit Agreement contains a number of financial covenants applicable to the Canadian subsidiaries, including covenants restricting their incurrence of additional debt, a debt to EBITDA ratio, a fixed charge coverage ratio, a requirement to maintain a CAD 28.0 million equity balance and a capital expenditure limit of CAD 2.0 million per year. The Company was in compliance with all covenants of the BMO Credit Agreement as of September 30, 2015. Amortization expenses relating to deferred financing charges were less than $0.1 million for the three months ended September 30, 2015 and 2014 and $0.1 million for the nine months ended September 30, 2015 and 2014. These costs are included in interest expense in the condensed consolidated statements of earnings (loss). Casinos Poland As of September 30, 2015, CPL had debt totaling PLN 13.4 million ($3.5 million based on the exchange rate in effect on September 30, 2015). The debt includes two credit agreements, one credit facility and four capital lease agreements. The first credit agreement is with mBank (formerly known as BRE Bank). Under this credit agreement, CPL entered into a three year term loan in November 2013 at an interest rate of Warsaw Interbank Offered Rate (“WIBOR”) plus 1.75%. Proceeds from the loan were used to repay the balance of the Bank Pocztowy loan related to the CPL properties, invest in slot equipment and relocate the Company’s Poznan, Poland casino. As of September 30, 2015, the amount outstanding on the term loan was PLN 5.6 million ($1.5 million based on the exchange rate in effect on September 30, 2015). CPL has no further borrowing availability under the loan, and the loan matures in November 2016. The mBank credit agreement contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and require CPL to maintain debt ratios and current liquidity ratios of 0.6 or higher. On March 26, 2015, CPL and mBank amended the credit agreement to lower the current liquidity ratio to 0.5. CPL was in compliance with all covenants of this mBank agreement as of September 30, 2015. The second credit agreement is also with mBank. Under this credit agreement, CPL entered into a three year term loan on September 15, 2014 at an interest rate of WIBOR plus 1.70%. Proceeds from the loan were used to repay balances outstanding under a prior credit agreement that matured in September 2014 and to finance current operations. As of September 30, 2015, the amount outstanding on the term loan was PLN 2.4 million ($0.6 million based on the exchange rate in effect on September 30, 2015). CPL has no further borrowing availability under the loan, and the loan matures in September 2017. The mBank credit agreement contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and require CPL to maintain debt ratios and current liquidity ratios of 0.6 or higher. On March 26, 2015, CPL and mBank amended the credit agreement to lower the current liquidity ratio to 0.5. CPL was in compliance with all covenants of this mBank agreement as of September 30, 2015. The credit facility is a short-term line of credit with BPH Bank used to finance current operations. The bank line of credit bears an interest rate of WIBOR plus 1.85%. The credit facility terminates on February 13, 2016. As of September 30, 2015, the amount outstanding was PLN 5.3 million ($1.4 million based on the exchange rate in effect on September 30, 2015) and CPL has approximately PLN 5.7 million ($1.5 million based on the exchange rate in effect on September 30, 2015) available under the facility. The BPH Bank facility contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and debt to EBITDA ratios. CPL was in compliance with all covenants of the BPH Bank line of credit as of September 30, 2015. CPL’s remaining debt consists of four capital lease agreements for various vehicles. As of September 30, 2015, the amount outstanding was PLN 0.1 million (less than $0.1 million based on the exchange rate in effect on September 30, 2015). In addition, under Polish gaming law, CPL is required to maintain PLN 3.6 million in the form of deposits or bank guarantees for payment of casino jackpots and gaming tax obligations. mBank issued guarantees to CPL for this purpose totaling PLN 3.6 million ($0.9 million based on the exchange rate in effect on September 30, 2015). The mBank guarantees are secured by land owned by CPL in Kolbaskowo, Poland and terminate on October 31, 2019. In addition, CPL is required to maintain deposits or provide bank guarantees for payment of additional prizes and giveaways at the casinos. The amount of these deposits varies depending on the value of the prizes. CPL maintained $0.3 million in deposits for this purpose as of September 30, 2015 and December 31, 2014. These deposits are included in deposits and other on the Company’s condensed consolidated balance sheets. Century Downs Racetrack and Casino CDR’s land lease is a financing obligation of the Company. Prior to the Company’s acquisition of its ownership interest in CDR, CDR sold a portion of the land on which the REC project has been constructed and then entered into an agreement to lease back a portion of the land sold. The Company accounts for the lease using the financing method, accounting for the land subject to the lease as an asset and the lease payments as interest on the financing obligation. Under the land lease, CDR has four options to purchase the land. The first option date is July 1, 2023. Due to the nature of the CDR land lease financing obligation, there are no principal payments due until the Company exercises its option to purchase the land. Lease payments are applied to interest only, and any change in the outstanding balance of the financing obligation relates to foreign currency translation. As of September 30, 2015, the outstanding balance on the financing obligation was CAD 19.5 million ($14.5 million based on the exchange rate in effect on September 30, 2015) and the implicit interest rate was 10.0%. As of September 30, 2015, scheduled maturities related to long-term debt are as follows:
Amounts in thousands |  | Bank of Montreal |  | Century Downs |  | Casinos Poland |  | Total
2015 |  | $ | 632 |  | $ | 0 |  | $ | 1,799 |  | $ | 2,431
2016 |  |  | 2,529 |  |  | 0 |  |  | 1,486 |  |  | 4,015
2017 |  |  | 2,529 |  |  | 0 |  |  | 236 |  |  | 2,765
2018 |  |  | 2,529 |  |  | 0 |  |  | 0 |  |  | 2,529
2019 |  |  | 13,512 |  |  | 0 |  |  | 0 |  |  | 13,512
Thereafter |  |  | 0 |  |  | 14,556 |  |  | 0 |  |  | 14,556
Total |  | $ | 21,731 |  | $ | 14,556 |  | $ | 3,521 |  | $ | 39,808

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_LongTermDebtTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration