Status March Construction Report
Bossier Casino Venture, Inc. dba Margaritaville Resort Casino P .O. Box 92610 Lafayette, Louisiana 70509-2610 (337) 266-2166
600 Jefferson Street Lafayette, Louisiana 70501 Fax (337) 266-2229
March 30, 2012 Dear Investors and Lenders: Following is my first status report with respect to our Margaritaville Bossier City project. Such report includes, as attachments, a detailed Construction Progress Report and current photos of the site. You will be receiving this week, directly from the Agent (Cortland Capital Market Services) our first Disbursement Advance Request, together with supporting documentation, and the Construction Consultants Report, reconciling such Disbursement Request to the Budget. These reports will demonstrate that we have made significant progress since funding last month and that we are currently on schedule and on budget. The official ground breaking ceremony was a major press event and success as Jimmy Buffett attended and we thus garnered front page newspaper coverage in Shreveport and related stories in dozens of television and radio news broadcasts, as well as print articles, throughout the entire region. We have been engaged in numerous additional activities, besides construction, in furthering the project. We have had numerous discussions with banks, equipment providers and other senior lenders with respect to securing the additional $25 million of super-‐senior secured financing necessary to complete the project. We expect proposals in the near future from one or more of the entities with whom we are dealing. We are completing interior design selections for guest rooms, restaurants, the casino and other public areas over the next thirty to forty-‐five days and will shortly commence construction of a model guest room and suite. We have interviewed and reached an agreement in principle with a candidate for the position of controller, and as soon as such agreement is complete, we will provide you with background information on this outstanding candidate. This person will immediately be given responsibility for preparing future draw requests and loan covenant compliance. He will also prepare our internal controls and procedures, and assist in the design and designation of equipment placement for the
March 30, 2012 Status Report Page Two cage, count rooms, players club and other similar areas. We have also had extensive discussions, and believe that we will come to an agreement shortly, with our number one candidate for General Manager. In addition, I have had discussions with prime candidates for the Director of Slots, Director of Table Games and Director of Security positions. All are seasoned executives who have significant experience in the Shreveport-‐Bossier City gaming market. We will have our website operational next week and a webcam to view construction on a real time basis within two weeks. Through a password controlled section of the website, my future status reports, as well as updated construction schedules, budgets and other similar information will be available to lenders and investors. We have made excellent initial progress and I am extremely pleased with our accomplishments during these first seven weeks since funding. Most importantly, I have confirmed that the first interest payment has been made today. Any questions, please feel free to call me at any time. Paul Alanis Chief Executive Officer Bossier Casino Venture, LLC 626.356.1188
Margaritaville Resort Hotel and Casino Bossier City, Louisiana
Construction Update Week 7 -‐ March 30, 2012 Executive Summary General Project Milestones • Project funding occurred on February 9th 2012. • The Notice to Proceed to the general contractor, Roy Anderson Construction, was given on February 13, 2012 and mobilization began without delay. • Administrative personnel of the project team which consist of the owner, the architect, the contractor, the construction consultant and the owner’s construction representative, met to review all disbursement documentation and established responsibilities, time lines and procedures for invoicing, processing, executing and submittals as they relate to the mechanics and requirements of the disbursement agreement. The disbursement agent was furnished with the anticipated recurring monthly schedule as it relates to the advance request. • The policies and procedures for the design/construction team have been established. They address processes for submittals, requests for information (RFI), scheduling, quality control, testing, reporting and timelines. • The design team has released the construction documents for the site work civil, foundations, structure, and the building envelope or exterior. • The general contractor has let and awarded the site work, foundations, structural steel, electrical, mechanical, plumbing and procurement of concrete subcontractors, consistent with the Budget. The award of post tension concrete and the structural concrete is pending. Bid packages for the building exterior, roofing, glass and glazing, doors and hardware, drywall, masonry and EFIS, have been assembled to let next week. • Parties on site include the owner’s representative, general contractor, site work subcontractor, piling subcontractor, electrical subcontractor, and mechanical contractor. Coordination meetings have been conducted weekly with agenda and minutes distributed by the host, the general contractor. • The project is currently in budget and on schedule. Construction Milestones For future on-‐ going reporting, it is important to understand that the project is sequenced into four (4) primary areas which are the hotel high rise, the casino barge and basin, the lowrise area consisting of restaurants, retail and back of house, and the event center. • Contemporaneous with the notice to proceed, the contractor pulled the appropriate construction permits for foundations and subcontracted the mass excavation site work for the footprint of all four areas. The general contractor installed a temporary 8’ chain link construction fence around the entire site. There was minimal activity on site during the first week of construction.
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In week 2, the subcontractor established all required erosion control, sampled the soils from three local dirt sources, mobilized all required heavy equipment, stockpiled the topsoil from the site and began the excavation. Once excavated to the plan depth, each area was proof rolled to detect any potential soft spots. The results were minimal and only three small locations required an 18” undercut where the soils were replace with dry suitable materials from the site. During week 3, after selecting the fill material for the project and having enough excavation completed, the contractor began hauling in select fill, which was installed and compacted in shallow lifts. Each lift, which is to be installed within 2% of optimum moisture and requiring a final compaction density of 95%, was test using a nuclear density device. Although the moisture was running high in the imported material it required minimal processing to achieve the moisture and density requirements. In week 3, the contractor also awarded the auger cast pile contract and the subcontractor began mobilizing its equipment. Concrete mix designs were submitted at this time along with the proposed locations and testing methods for test piles. Beginning week 4, the site work contractor had 80% of the fill material for all areas receiving deep foundations in place up to the critical elevation at the top of proposed piles and below the pile caps (+ or-‐ 12”). By the end of the week the pile contractor had their crane set up and they were able to begin installation for two test piles along with the six reaction piles at each location. These piles were not completed in week 5, and we are required to be in place for a minimum of 7 days prior to testing. Week 5 brought the completion of the test pile installation while the site work contractor completing all mass excavation continued to install selected material in the low rise area. The clearing operation along the river, west of the proposed parking area, began and was completed in 3 days. With reinforcing steel for the deep foundations arriving on site the contractor began sorting and staging the re-‐bar as they prepared to tie the steel for the auger cast production piles. During week 6, although a short week due to 2 days of heavy rain, the test piles were tested and these test results were processed and circulated to the design and construction team. During the first 2 days of week 6 the site work subcontractor continued to import fill at the low rise and outside the perimeter of the building footprint. It then graded the site for positive draining in anticipation of the forecasted heavy rains. Week 7, after the review of the test pile results, the contractor proposed and the design team approved, the final geometry and the grout mix design for the production piles. During these discussions everyone agreed that we would install 2 test piles using the final geometric design which is 18” in diameter in lieu of 16” and all proposed piles will be a uniform 55’ in depth in lieu of varying lengths. Once installed the contractor began production piling at noon on March 29, 2012. The first piles installed were at the south end of the hotel tower footprint. The piles will be installed from south to north along the footprint of the hotel tower, then west to east at the casino basin and barge. The site work subcontractor is continuing the fill operation in the lowrise and areas adjacent to the building. To date approximately 62,000 cubic yards of imported select fill has been installed.
The Owner’s website is scheduled to be operative on Friday April 6th and fully functional with the installation and activation of the webcam shortly thereafter, where lenders and investors will be able to view construction progress on a real time basis.
600 Jefferson Street Lafayette, Louisiana 70501 Fax (337) 266-2229
March 30, 2012 Dear Investors and Lenders: Following is my first status report with respect to our Margaritaville Bossier City project. Such report includes, as attachments, a detailed Construction Progress Report and current photos of the site. You will be receiving this week, directly from the Agent (Cortland Capital Market Services) our first Disbursement Advance Request, together with supporting documentation, and the Construction Consultants Report, reconciling such Disbursement Request to the Budget. These reports will demonstrate that we have made significant progress since funding last month and that we are currently on schedule and on budget. The official ground breaking ceremony was a major press event and success as Jimmy Buffett attended and we thus garnered front page newspaper coverage in Shreveport and related stories in dozens of television and radio news broadcasts, as well as print articles, throughout the entire region. We have been engaged in numerous additional activities, besides construction, in furthering the project. We have had numerous discussions with banks, equipment providers and other senior lenders with respect to securing the additional $25 million of super-‐senior secured financing necessary to complete the project. We expect proposals in the near future from one or more of the entities with whom we are dealing. We are completing interior design selections for guest rooms, restaurants, the casino and other public areas over the next thirty to forty-‐five days and will shortly commence construction of a model guest room and suite. We have interviewed and reached an agreement in principle with a candidate for the position of controller, and as soon as such agreement is complete, we will provide you with background information on this outstanding candidate. This person will immediately be given responsibility for preparing future draw requests and loan covenant compliance. He will also prepare our internal controls and procedures, and assist in the design and designation of equipment placement for the
March 30, 2012 Status Report Page Two cage, count rooms, players club and other similar areas. We have also had extensive discussions, and believe that we will come to an agreement shortly, with our number one candidate for General Manager. In addition, I have had discussions with prime candidates for the Director of Slots, Director of Table Games and Director of Security positions. All are seasoned executives who have significant experience in the Shreveport-‐Bossier City gaming market. We will have our website operational next week and a webcam to view construction on a real time basis within two weeks. Through a password controlled section of the website, my future status reports, as well as updated construction schedules, budgets and other similar information will be available to lenders and investors. We have made excellent initial progress and I am extremely pleased with our accomplishments during these first seven weeks since funding. Most importantly, I have confirmed that the first interest payment has been made today. Any questions, please feel free to call me at any time. Paul Alanis Chief Executive Officer Bossier Casino Venture, LLC 626.356.1188
Margaritaville Resort Hotel and Casino Bossier City, Louisiana
Construction Update Week 7 -‐ March 30, 2012 Executive Summary General Project Milestones • Project funding occurred on February 9th 2012. • The Notice to Proceed to the general contractor, Roy Anderson Construction, was given on February 13, 2012 and mobilization began without delay. • Administrative personnel of the project team which consist of the owner, the architect, the contractor, the construction consultant and the owner’s construction representative, met to review all disbursement documentation and established responsibilities, time lines and procedures for invoicing, processing, executing and submittals as they relate to the mechanics and requirements of the disbursement agreement. The disbursement agent was furnished with the anticipated recurring monthly schedule as it relates to the advance request. • The policies and procedures for the design/construction team have been established. They address processes for submittals, requests for information (RFI), scheduling, quality control, testing, reporting and timelines. • The design team has released the construction documents for the site work civil, foundations, structure, and the building envelope or exterior. • The general contractor has let and awarded the site work, foundations, structural steel, electrical, mechanical, plumbing and procurement of concrete subcontractors, consistent with the Budget. The award of post tension concrete and the structural concrete is pending. Bid packages for the building exterior, roofing, glass and glazing, doors and hardware, drywall, masonry and EFIS, have been assembled to let next week. • Parties on site include the owner’s representative, general contractor, site work subcontractor, piling subcontractor, electrical subcontractor, and mechanical contractor. Coordination meetings have been conducted weekly with agenda and minutes distributed by the host, the general contractor. • The project is currently in budget and on schedule. Construction Milestones For future on-‐ going reporting, it is important to understand that the project is sequenced into four (4) primary areas which are the hotel high rise, the casino barge and basin, the lowrise area consisting of restaurants, retail and back of house, and the event center. • Contemporaneous with the notice to proceed, the contractor pulled the appropriate construction permits for foundations and subcontracted the mass excavation site work for the footprint of all four areas. The general contractor installed a temporary 8’ chain link construction fence around the entire site. There was minimal activity on site during the first week of construction.
•
•
•
•
•
•
In week 2, the subcontractor established all required erosion control, sampled the soils from three local dirt sources, mobilized all required heavy equipment, stockpiled the topsoil from the site and began the excavation. Once excavated to the plan depth, each area was proof rolled to detect any potential soft spots. The results were minimal and only three small locations required an 18” undercut where the soils were replace with dry suitable materials from the site. During week 3, after selecting the fill material for the project and having enough excavation completed, the contractor began hauling in select fill, which was installed and compacted in shallow lifts. Each lift, which is to be installed within 2% of optimum moisture and requiring a final compaction density of 95%, was test using a nuclear density device. Although the moisture was running high in the imported material it required minimal processing to achieve the moisture and density requirements. In week 3, the contractor also awarded the auger cast pile contract and the subcontractor began mobilizing its equipment. Concrete mix designs were submitted at this time along with the proposed locations and testing methods for test piles. Beginning week 4, the site work contractor had 80% of the fill material for all areas receiving deep foundations in place up to the critical elevation at the top of proposed piles and below the pile caps (+ or-‐ 12”). By the end of the week the pile contractor had their crane set up and they were able to begin installation for two test piles along with the six reaction piles at each location. These piles were not completed in week 5, and we are required to be in place for a minimum of 7 days prior to testing. Week 5 brought the completion of the test pile installation while the site work contractor completing all mass excavation continued to install selected material in the low rise area. The clearing operation along the river, west of the proposed parking area, began and was completed in 3 days. With reinforcing steel for the deep foundations arriving on site the contractor began sorting and staging the re-‐bar as they prepared to tie the steel for the auger cast production piles. During week 6, although a short week due to 2 days of heavy rain, the test piles were tested and these test results were processed and circulated to the design and construction team. During the first 2 days of week 6 the site work subcontractor continued to import fill at the low rise and outside the perimeter of the building footprint. It then graded the site for positive draining in anticipation of the forecasted heavy rains. Week 7, after the review of the test pile results, the contractor proposed and the design team approved, the final geometry and the grout mix design for the production piles. During these discussions everyone agreed that we would install 2 test piles using the final geometric design which is 18” in diameter in lieu of 16” and all proposed piles will be a uniform 55’ in depth in lieu of varying lengths. Once installed the contractor began production piling at noon on March 29, 2012. The first piles installed were at the south end of the hotel tower footprint. The piles will be installed from south to north along the footprint of the hotel tower, then west to east at the casino basin and barge. The site work subcontractor is continuing the fill operation in the lowrise and areas adjacent to the building. To date approximately 62,000 cubic yards of imported select fill has been installed.
The Owner’s website is scheduled to be operative on Friday April 6th and fully functional with the installation and activation of the webcam shortly thereafter, where lenders and investors will be able to view construction progress on a real time basis.
