As required by Item 402(v) of Regulation S-K, the Company is providing the following information about the relationship between executive officers” compensation and Company’s financial performance.
Pay Versus Performance Table
The following table presents information regarding compensation of our principal executive officer (“PEO”) and the average compensation of the non-PEO NEOs for services rendered during the last five completed fiscal years, and certain financial metrics (total shareholder return, net income and net revenue) for the same period.
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| · · · · · · Average · · Average · · Value of Initial Fixed $100 · · · · · · |
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| · · Summary · · Compensation · · Summary · · Compensation · · Investment Based on: · · · · · · |
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| · · Compensation · · Actually · · Compensation · · Actually · · · · Peer Group · · · · |
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| · · Table Total · · Paid · · Table Total for · · Paid to · · Total · · Total · · · · |
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| · · for · · to · · non-PEO · · non-PEO · · Shareholder · · Shareholder · · · · · Adjusted |
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| Year · · PEO (1)(3) · · PEO (1)(5) · · NEO (2)(3) · · NEO (2)(5) · · Return (6) · · Return (6)(7) · · Net Income · · EBITDA (8) |
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| 2020 | | $2,253,287 | | $6,047,734 | | $638,818 | | $1,673,016 | | $126.10 | $115.48 | | $23,678,675 | | $43,161,156 |
| 2021 | | $5,442,917 | (4) | $10,571,794 | (4) | $1,192,276 | (4) | $2,730,885 | (4) | $152.32 | $113.77 | | $68,487,227 | | $137,294,593 |
| 2022 | | $3,496,113 | | $6,859,004 | | $961,573 | | $1,892,490 | | $158.37 | $90.05 | | $87,478,678 | | $167,085,251 |
| 2023 | | $3,209,187 | | $3,968,861 | | $904,480 | | $1,080,524 | | $154.22 | $104.02 | | $82,448,188 | | $170,832,406 |
| 2024 | | $3,660,587 | | $8,116,510 | | $1,047,191 | | $2,318,297 | | $178.88 | $97.42 | | $72,769,403 | | $180,394,138 |
| (1) | During the period 2020-2024, our PEO was our CEO, John Farahi. |
| (2) | During the period 2020-2024, our non-PEO NEOs were our President, Bob Farahi, and our CAO, Edwin S. Koenig. |
| (3) | Amounts derived directly from the “Summary Compensation Table”. |
| (4) | The amount includes a one-time stock bonus awards granted to the CEO and the President for successful completion of the 5-year expansion project. |
| (5) | Reconciliation of Compensation Actually Paid to Summary Compensation Total. |
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| Year · · Summary Compensation Table Total · · Fair Value at Grant Date of Stock Awards Granted in the Covered Fiscal Year (deduct) · · Fair Value at Grant Date of Option Awards Granted in the Covered Fiscal Year (deduct) · · Fair Value at Fiscal Year-End of Stock Awards Granted in the Covered Fiscal Year (add) · · Fair Value at Fiscal Year-End of Option Awards Granted in the Covered Fiscal Year (add) · · Change in Fair Value at Fiscal Year-End from that at Prior Year-End of any Outstanding and Unvested at Year-End Option Awards Granted in Prior Years (add) · · Change in Fair Value at Vesting Date from that at Prior Year-End of any Option Awards Vested During the Current Year and Granted in Prior Years (add) · · Compensation Actually Paid |
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| PEO | | | | | | | | | | | | | | | | | | | | | | | | |
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| 2020 | | | $2,253,287 | | | $— | | | $1,632,278 | | | $— | | | $4,081,415 | | | $1,689,316 | | | $(344,007) | | | $6,047,734 |
| 2021 | | | $5,442,917 | | | $1,272,900 | | | $2,114,758 | | | $1,109,250 | | | $4,929,951 | | | $1,697,342 | | | $779,992 | | | $10,571,794 |
| 2022 | | | $3,496,113 | | | $— | | | $2,573,722 | | | $— | | | $5,125,949 | | | $392,002 | | | $418,662 | | | $6,859,004 |
| 2023 | | | $3,209,187 | | | $— | | | $2,302,418 | | | $— | | | $4,610,092 | | | $(1,031,990) | | | $(516,010) | | | $3,968,861 |
| 2024 | | | $3,660,587 | | | $— | | | $2,754,025 | | | $— | | | $5,259,947 | | | $1,300,007 | | | $649,994 | | | $8,116,510 |
| Average Non-PEO NEO | | | | | | | | | | | | | | | | | | | | | | | | |
| 2020 | | | $638,818 | | | $— | | | $436,721 | | | $— | | | $1,122,377 | | | $464,565 | | | $(116,022) | | | $1,673,016 |
| 2021 | | | $1,192,276 | | | $318,225 | | | $641,983 | | | $277,313 | | | $1,540,637 | | | $466,765 | | | $214,102 | | | $2,730,885 |
| 2022 | | | $961,573 | | | $— | | | $689,592 | | | $— | | | $1,409,624 | | | $115,151 | | | $95,733 | | | $1,892,490 |
| 2023 | | | $904,480 | | | $— | | | $634,916 | | | $— | | | $1,267,762 | | | $(303,149) | | | $(153,654) | | | $1,080,524 |
| 2024 | | | $1,047,191 | | | $— | | | $774,876 | | | $— | | | $1,512,276 | | | $373,752 | | | $159,954 | | | $2,318,297 |
| (6) | Amounts derived from the performance graph presented in Company’s Annual Report on SEC Form 10-K for the Year Ended December 31, 2024, filed on March 2, 2025. |
| (7) | Peer group is S&P 1500 Casino & Gaming Index. |
| (8) | Adjusted EBITDA, a non-GAAP financial measure, consists of net income plus loss on disposal of assets, provision for income taxes, stock-based compensation expense, other one-time charges, pre-opening expenses, construction litigation expenses, acquisition expenses, interest expense, depreciation and amortization less interest income, any benefit for income taxes and gain on disposal of assets. Adjusted EBITDA should not be construed as an alternative to operating income (as determined in accordance with US Generally Accepted Accounting Principles), as an indicator of the Company's operating performance, as an alternative to cash flows from operating activities (as determined in accordance with US GAAP) or as a measure of liquidity. This measure enables comparison of the Company's performance over multiple periods, as well as against the performance of other companies in our industry that report Adjusted EBITDA, although some companies do not calculate this measure in the same manner and, therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies. |
Relationship Between Pay and Performance
We believe that the compensation actually paid to our CEO in each of the five years reported above and over the five-year cumulative period are reflective of the Company’s performance, including financial performance, as well as capital projects completed and placed into operation. As described in the COMPENSATION DISCUSSION AND ANALYSIS section, three of the four elements of the CEO’s compensation, representing approximately 80% of his actual pay, are directly linked to the CEO’s performance. CEO’s compensation actually paid fluctuated year-over-year, primarily due to the fluctuation in our stock price and Company’s achieving quantitative and qualitative targets previously established by the Board.
Financial Performance Measures List
The following are financial performance measures, which in the Company’s assessment, represent the most important financial performance measures used by the Company to link compensation actually paid to the NEOs for 2024:
| ● | Diluted Earnings per Share |
Grant Practices for Stock Options
The Audit Committee awards options based on predetermined schedule.
In 2024 there were no option awards granted to the NEOs in the period beginning four business days before and one business day after the filing of a periodic report on Form 10-Q or form 10-K, or the filing or furnishing of a current report on Form 8-K that discloses material nonpublic information.** **
