Spanish Bit Presentation 2009

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Triad Resorts, LLC Presentation for the Spanish Bit Resort & Casino

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Spanish Bit Presentation 2009

  1. 1. January 12, 2009 Monarch Casinos Spanish
Bit
Resort,
LLC
 Jackpot,
NV

  2. 2.   Privately held Nevada Limited Liability Company   Developer of affordable hospitality centers planned within destination resort cities throughout the Western Hemisphere   Company focus: –  Build sustainable economic stimulus within destination communities –  Eco-conscience, using green building practices and alternative energy resources –  Provide responsibly themed, family oriented recreational resorts and affordable lodging centers
  3. 3.   Triad Resorts was founded in January 2005 as an idea to bring year round indoor themed destination resorts to seasonal climate areas   The Company acquired 113 acres of land in Jackpot, Nevada in August 2005   The Company has since completed all required zoning and has secured entitlements for its resort development, to be known as the Spanish Bit Resort & Casino   The Company has received its grading permit from Elko County and has established the project ready to commence site work   The Company has secured 81 additional acres of land adjacent to its 113 acres for employee housing and a phase II development   The Company has assembled a quality construction and development team, and has commenced with design
  4. 4.   Project Description –  A completely integrated resort designed for year round use –  600 room resort hotel; ability to add fractional unit sales –  Full scale casino with slots and table games –  Spa, retail, restaurants, entertainment, and outfitters –  Indoor events center and indoor water park –  300 units of multifamily employee housing –  Phase II commercial, retail, RV, and lodging   Project Projections –  Proformas project a 65% sub-market share (Elko County’s gaming win market growth rate has exceeded 10% per year and now exceeds $300MM) –  Local market competition is underinvested and regional demand wants new as evidenced by Peppermill’s $500MM expansion in West Wendover –  Conservative proformas reflect project EBITDA in excess of $50MM within 5 years, with gaming revenues representing approx. 45% of project EBITDA
  5. 5.   Border town located on U.S. Highway 93, servicing Southern Idaho, Elko County, and Northwestern Utah   3.5+ million people within 250 miles / 4 hours driving time   Market monopolized by $1.15B Ameristar Casinos (stock symbol “ASCA”) - Cactus Pete’s and Horseshu casinos   Jackpot’s demographic compares favorably to the expanding W. Wendover market that is dominated by Peppermill Casinos which recently completed $500MM in casino expansions   Jackpot has been monopolized, preventing any new gaming development in over 25 years due to collaboration in under-sizing water and sewer delivery infrastructure   Triad Resorts has forced change, as evidenced by Elko County’s cooperation, and local and regional support
  6. 6.   ASCA has a market share of 25% of the entire Elko County gaming market and dominates the Jackpot sub-market   ASCA reported Jackpot net revenues in 2007 of $73.2MM and EBITDA of $18.8MM (25.7% margin); their Jackpot gaming win revenues exceeded $75.1MM   ASCA’s Jackpot properties, with 1,019 slots and 35 gaming tables, have a valuation exceeding $150MM at 8X 2007 reported EBITDA   ASCA’s properties have performed remarkably well given they are aged and in dire need of capital improvement (ASCA has announced plans for $16MM in room refurbishment)   Regional growth and demand have left the market starved for a new product due to underinvestment by competition   Despite strong market demand fundamentals no new competing projects are planned in the primary market area
  7. 7.   Long and distinguished history in gaming (established in 1954)   Market completely locked down by ASCA for past 25 years, with no meaningful new development   Craig Neilsen, founder and former CEO of ASCA, died unexpectedly in 2006 leaving no one within ASCA with any real affinity to Jackpot and thereby strengthening the opportunity for Triad Resorts   Through three years of hard work, with a presence on the ground in Jackpot, the market has been officially opened up by Triad Resorts for new development   Remaining political and legal opposition from local casino, Barton’s Club 93, has been successfully thwarted giving the project additional momentum to move forward   No real existing political or development hurdles exist
  8. 8. Gaming Market - Slots / Tribal - Slots / Truck Stop - Slots & Tables - Resort (>$200MM Win) - Resort (>$400MM Win) Market Population Green Ring ~ 150,000 Blue Ring ~ 500,000 Red Ring > 3,500,000 Target Markets Jackpot - 3.5 million W. Wendover / SLC - 2.0 million Spanish Bit Core Market - 1.5 million Driving Distances Jackpot to: Twin Falls – 48 miles Elko – 115 miles Boise – 177 miles Salt Lake City – 247 miles
  9. 9.   Project has received full zoning, entitlements, and grading permits; ratification of Town Master Plan completed by Elko County   Full architectural and structural design has been initiated   Operating partnerships being pursued and expected to be established within 45 days   Final market studies by The Innovation Group to be initiated   Estimated total Phase I project cost of approximately $80MM and total project cost estimated at approximately $150MM   Funds spent to date of $3.8MM, all toward project start-up and syndication   Additional assets have been controlled for construction, housing, and Phase II commercial development
  10. 10.   Triad Resorts is presently interviewing potential gaming and operating partners for design input, licensing of casino, financial assistance, and management of the Spanish Bit Resort & Casino   The Company has initiated design with its architects   The Company has begun negotiations with Elko County for its Developers Agreement regarding infrastructure improvements   Initial ground breaking is scheduled by Spring 2009   Grand opening for Phase I by Summer 2010
  11. 11.   Pre-construction development to date –  $3.8MM total spent on start-up and syndication –  $1.5MM raised from Series A Preferred LLC Units –  $0.2MM raised from Series B Preferred LLC Units –  $2.1MM raised from debt and contributions   Current and future financings –  $5.2MM Series B Preferred LLC Unit Offering for additional land considerations, gaming licensing and final pre-construction development –  $20.0MM for site preparation, working capital, and infrastructure development (part of Phase I use of funds)   $150MM – Anticipated full project financing cost
  12. 12.   Jackpot’s long and distinguished history as a proven gaming market   Monopolistic characteristics in gaming market   Aged and inferior product provided by competition   Spanish Bit Resort amenities will pull visitors (indoor facilities – events center and waterpark) and gaming will capture dollars   Jackpot town amenities (golf course, schools, etc..) added benefit   Continued future growth expected throughout the region   Appeal of town name and marketing cachet for tourism   Ability to be market leader, retain best employees, and deliver projected returns to our investors
  13. 13.   “By combining the art of applying new eco-conscience development technologies with a focus on delivering affordable eco-friendly developments in un-tapped and/ or high potential markets benefitting families, individuals and communities alike, we aim to offer a unique opportunity in both our business strategies as well as optimal investment returns that will be unparalleled while preserving our environment for generations to follow.”
  14. 14. Spanish Bit Resort & Casino Jackpot, Nevada www.TriadResorts.com www.SpanishBitResort.com

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