Q2 2021 Hall of Fame Resort & Entertainment Co Earnings Call

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Greetings and welcome to the Hall of Fame resort in Entertainment Company's second quarter 2021 earnings Conference call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation, if you'd like to ask a question you May press star one on your telephone keypad.

If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. As a reminder, this conference is being recorded it is now my pleasure to introduce your host and graphics executive Vice President of Public Affairs. Thank you. Please go ahead.

Good morning, and thank you for joining us for our second quarter 2021 earnings Conference call. Our latest press release supplemental slides and 10-Q were posted yesterday evening after market hours. These documents can be found in the Investor Relations section of our website at H F. R E D O dot com.

After this brief introduction, Michael Crawford, President and CEO will give us an overview of the quarter's results and an update of our fiscal year priorities.

Jason Krause, our CFO will then provide detailed analysis of the quarter's financial results and update our fiscal 2021 outlook.

During today's call we will make forward looking statements that reflect the company's current expectations about future plans and performance.

These statements rely on assumptions and estimates and actual actual results may differ materially due to risks and uncertainties I encourage you to read the full disclosure concerning forward looking statements in the earnings press release.

Additionally, please note that the company uses non-GAAP results to evaluate performance internally as detailed in the press release we.

We have posted a supplementary slide deck summarizing the quarterly results. These slides can be accessed on our website and will be archived there along with a replay of this call.

You have additional questions. After today's call. Please contact me directly.

Now my pleasure to turn the call over to President and CEO Michael <unk>.

Thanks, Sharon and good morning, everybody.

I have a few words that I'd like to just start with the first our football is back.

Very strongly we're excited about it couldn't have been a greater entrainment week for us.

Hosted the game of course between Pittsburgh in Dallas, just a couple of interesting stat for you $7.3 million viewers up 37% from 2019 it was broadcast on Fox.

The largest viewed game on Fox since 2011, so two very storied programs coming to life Europe, Tom Benson Hall of Fame Stadium, it's often village powered by Johnson controls absolutely an electric environment for those of you who watched I'm sure you would agree.

And then we went on to <unk> and we hosted two in trauma classes again I want to congratulate all of the inductees are some fantastic speeches really compelling just exciting for the sport of football, but you can tell these gentlemen, really wanted to do great things both on the field and off the field they've done.

I'm on the field of knowledge, they're turning to us to have an impact elsewhere as well and in China. The two events that we broadcast on the NFL network and on ESPN is well over 2 million viewers in aggregate for those events. So why is that important well it gave us a chance to create one of the kind of experiences for <unk>.

Our guests are things that you couldn't see in and around campus VIP tailgate parties ballooned festivals parades all the types of things that you would expect to go with big events like we hosted.

Gave us significant brand uplift you know brand awareness as we welcome tens of thousands of people to our campus watching these types of events and seeing all the great progress that I'll talk about around construction was really exciting in the commentary that came back to me. It was it was fantastic to see the progress in some of the buildings that were already coming out of it.

Ground and the things that we're going to be able to be present in the future for our guests to experience and then lastly of course for our shareholders and our company generated multiple different types of revenue streams for us are.

But these types of events absolutely are predicated upon so you know a big week something that is hard to replicate but again, we've had multiple things over the last month.

During that week. We also hosted our first co produced live broadcast with World Chase Tag. The number one show on E. S. P. N. Two that day. It has since been weird on E. S. P. N in on a lot of ESPN social channels. So exciting for our media division to get out of the gate with such a successful opportunity.

There are women's football Alliance Championships again, very well attended exciting to be able to play host to women who have played for decades in this sport and franchises that have been around for equally as long I want to congratulate the Boston Renegades, the Derby City dynamite into Nevada storm, they all want their divisions and I'll start.

Game was also really an exciting game to watch.

And then lastly, you know it was a a week, where we got to ring. The bell for the NASDAQ closing and being listed on the NASDAQ has been an honor, but again more brand awareness for our company and all the great things that we've been doing across our three business units.

We announced a partnership with E Sports Entertainment Group I'll talk about that in just a moment and we also relaunched our in F. T business and I would say we've relaunched it quite successfully in all I'll talk about that as well.

Let me, let me turn to construction because I know there's been questions are being.

Being asked and in a lot of thought being given around construction progress we're no different than most out there today as it relates to challenges you know construction labor is challenging logistics trucking and shipping challenging and yet our team of project managers and our partners in Turner and Hunton wells.

The construction group have all done a very good job contingency planning and so we remain on course to finish our center for excellence. Some of you may have seen that in the background of all of those live events that I just spoke about we remain on course to finish that in late Q3, we've continued the tenant and process there and those tenants are.

Specced it to move in in Q4 and start generating revenue out of that facility as well Q4.

The fan engagement area at the East <unk> zone complete.

So brand new Jumbo Tron brand new area for fans to enjoy all of the different types of events sport and non sport that we have in our stadium and another way to monetize a particular area of that look of that location.

We've continued to expansion of our village youth sports complex and we've done that for two reasons. One we want to continue to bring great amenities for those participating in our youth sports.

Two we wanted to expand our capabilities to hold even larger events. This year, we expect to welcome again hundreds of thousands of participants and fans into this area. So enhancing that was really important to us and it's under construction and scheduled to finish in Q2 of next year.

I've talked about site work roadway realignments, all the things that we need to do from a utility point of view that work continues it's necessary for expanding and developing just in another week or two we will be pouring foundations for our retail promenade and then our steel arrives for that in late September and will start to her.

Those buildings, which is really really exciting.

And then the last thing I'd say is our center for performance. We have done the site formation work for our center for performance recall this is our indoor.

Facility that will allow us to expand sport to basketball and volleyball wrestling Bandon cheerleading competitions, but it will also give us a facility, where we can host big events could be concerts, but it could be other types of festivals home and garden shows et cetera, again, expanding upon our business model and.

And year round attendance to the destination flattening out seasonality and this work is really progressing still in a very challenged timeframe. I mean, we all understand what COVID-19 is and where it's at with the Delta variance.

But we've challenged our team and our team has responded to make sure that we are contingency planning as I said, but also adjusting for timing logistics timing and making sure that we take advantage of pricing when we can and also being pragmatic about when we want to price other items to come in.

Our goal is still to finish construction by 2023 with the Waterpark being the last destination that will be there simply because of how long that destination takes to create.

That leads me into probably one of the most important topics that I'm sure is on everybody's mind and we spoke about this at the last call construction loan and timing of the construction loan.

Let me start off by saying that construction loan itself that actual facility is a part of the overall construction financing that we have continued to put in place. We have several term sheets and in fact signed two of them. This week for different types of construction financing.

Not be traditional construction loan in essence, but we're wanting to be very pragmatic about the timing of the facility that we put in place construction lending is expensive right now again, a tough environment for construction lending as evidenced by some of our peers in different industries and the leisure tours.

A ministry and our philosophy is we want to make a good decision versus a quick decision.

I just said construction is continuing and if you know about creating destinations you'll know that the actual construction loan itself is the last piece of the capital structure that gets spent you start with your equity you move through the other public and private financing vehicles that you've put in place and then into the construction loan.

So while we have still continued a lot of conversations about the actual construction loan itself and those conversations are continuing right now again, we're going to make the best decision for our shareholders and for our company and we want a capital structure that is going to be cost effective and so we're trying to play.

<unk> multiple pieces of that capital structure in place with different types of construction lending to take full advantage of that and in fact, I would say lower cost construction financing. So that when you aggregate overall, it's a much more affordable financing tool in vehicle that we have in place I hope that helps people understand.

But our goals haven't changed the goalpost haven't moved but we are being pragmatic as I said and quick is not best smart and timing of being making that decision is really what we're focused on so as that progresses, we will provide more updates to you on that.

The one that I'm sure is on everybody's mind, because I get asked this question a lot Mike what about sports betting.

And where are you with sports betting.

Call that we signed a deal with esports Entertainment group and we did that for two reasons. One they are the absolute best in esports gaming and we always made for our gaming division esports a priority.

We were fortunate with grant Johnson and his team to sign a deal that we think is going to bring tens of thousands of people to our destination for esports tournaments. We're building an esports helix complex there will be an educational component attached to this so we feel very good about what E sports and how esports will be represents.

In our location, but if E sports were to become part of the sports betting and.

Gaming environment here in Ohio, if it were to be legalized. We also have a partner that has strong capabilities on the E sports betting front and so we.

We stay very closely connected to what I would refer to as the legislators to key legislators that are forming the bill and that are putting the go forward for approval.

I think we're well positioned as a company and as a destination to achieve our goal of having a license of sports betting license at the appropriate time I think the target of September is one that's been publicly articulated by the legislators and so we are continuing our conversations with key sports betting partners.

In hopes that we will have a sports betting partner in place as that legislation becomes law.

This has not changed from the last update that I provided I'm excited about the conversations we're having our people are excited about Ohio I should say companies are excited about Ohio in general and the access to Ohio and again as a company that's at the Crossroads between sports and Entertainment I think it makes complete sense for us to be in the <unk>.

Courts bedding environment and partners I think are seeing that and so we're working diligently our entire team is on having a partnership in place.

At the appropriate time.

Let me move on to our Q2 overview and some of the some of the Big plays I would say that we made during Q2.

And across all of our business units you know, we're really focused on creating synergy between the different business verticals that I spoke about theme destination based assets.

Our hall of Fame village Media company, and our gaming Division as well.

And try them that week is a good example of that you know people came they stayed in our hotel they hosted big events in our hotel food and beverage sales were very high.

In sessions at the stadium admissions at the stadium a lot of outside entertainment and hosting you know, but the synergy between the other things that we had going on and we took advantage of that weekend to host.

Our World Chase Tag and World chose tag as I mentioned number one program on ESPN, two and has been on re shown on ESPN platforms. We also took advantage of that platform to launch our next round of Nf Ts that by the way are selling quite well into the hundreds with our athletes that we've launched and I would say.

The product that we've partnered with Dolphin and created and listed on F. T X has been absolutely phenomenal well received easily accessed and so we think as we listen to our investors through.

Through our first launch we've got we've taken significant steps forward in making this product compelling accessible and something that is very collectible in the digital space.

In terms of our destination based assets as you would expect our Doubletree hotel was sold out multiple times during Q2 and over in China at weekend.

ADR is improving quarter over quarter weekend occupancy is improving in line with industry trends and the data is showing that the hotel industry overall is improving and reaching a more normalized state of course, you could you could ask the question about the variant and the impact we keep a very close eye on that but as I've stated before we.

Sort of provide the gas to fuel the engine ourselves our youth sports program, our concerts or festivals things that we're hosting here women's football lines Championships were filling our own hotel and that generates our own business.

And more of that will be coming and I'll talk about that as we look forward to Q3 were already pre pre wired to have a lot of occupancy in our hotel asset I talked about the center for excellence.

On track on time for completion and in fact, I'm being told slightly under budget, which is a good thing and we feel very good about our ability to project manage these assets, we stay close to the commodities market steel and lumber.

We believe things are starting to normalize a bit even though some of the logistics challenges we're having.

And then again hosting numerous events in our Tom Benson Hall of Fame Stadium throughout Q2, multiple more now booked in Q3 and Q4 from small to large.

We had a lot of success in our east <unk> zone that we completed our the environment. We've created in our stadium really is one of a kind you feel immersed in whatever event that you're attending between the jumbo tron at eastern and our video mesh while that is still being constructed at our west end on the constellation.

Center for excellence retail, we signed partnerships with multiple more groups Starbucks, our esports entertainment group for that helix.

Location and our retail promenade and that's in addition tissue lives in top golf swing suites.

And then also in our center for excellence.

The agreement, we signed with NFL alumni health to become a attendance there to really do a lot of our innovative work in the area of brain trauma, so exciting progress on partnerships as well.

From a media perspective.

A lot of new things going on.

Existing products that we announced last year, we did make the announcement that the NFL alumni Academy is going to come back for a second season again programming for our stadium programming for our media Division.

We are out now selling that program in partnership with sports illustrated and studio one on one for the second season, So really looking forward to bringing that dock your series to life I talked about World Chase Tag co producing that first live event for a media company.

I couldn't have been more proud of the team and how that turned out in ftes and unplanned business, but showing how nimble we can be listening to our investors launching with greater quantity a slightly different product and I think it's been very well received we have six players out there today with multiple in ft.

<unk> digital collectible assets and our intention is to add more if you think about the access that we have to the NFL.

Previous NFL players the alumni players our hall of Famers and the archives and the pro Football Hall of Famer our intention is to create great digital collectible material that our guests will come back to and look at and by over and over again inspired us to show that we have begun.

Begun production on or I should say, we will begin production on later this year. It will air in 2022, and it really does highlight I think the essence were about inspirational stories of NFL players doing great things in their communities and so another show that our media company is intimately involved with and then Heisman to haul.

I spoke about last time, the 10 players ever to have been inducted into the Pro Football Hall of Fame and also won a Heisman Trophy more men, having walked on the Moon and then having those two distinctions bestowed upon them now funded going into production and.

And we hope to have a partnership for distribution on that product in the very near term as well.

And by the way you know just dimension that is a good example of not only is it a media project a documentary that we can develop but it also fuel part of our Nf key program with four of those high as men to haul players, becoming part of the N F. T collectible series that we have.

Our gaming Division listen if your if Youre excited about fantasy you better be excited about our hall of Fantasy League. I mean, this is a one of a kind League draft happening. This Sunday five P. M starts with the Vegas pocket King Seattle has Philadelphia powder Keg, New York Bodega Cats.

Boston Barfly, La Sidekicks, Ohio, Good Chicago, Hogmolly, Texas, Atlanta Hot Wings, I mean, if you're not jazzed about those names those logos those brands I mean come on and these are great great fantasy football franchises, but more importantly, we announced our commissioner trailed Davis I could not have more respect for this guy.

If you've seen some of his recent communication I had a chance to talk with him over in China, but he is over the Moon Jazzed about this league. He asked me about his powers and his authority in the league and how he can do all those out.

Simply said G D make it happen year, our guy and he is a guy of integrity and a guy who has a lot of desire to make this fantasy league work going beyond that we announced our front offices and again as we always said the tie to US is not just brand its professional football expertise and it comes in two <unk>.

<unk> in our front offices professional fantasy football expertise with people, who are playing fantasy and have had great success in fantasy comprising sort of a G. M area of our front office and then professional football players who have had great success on the field who have also been.

<unk> been excited about the fantasy opportunity. This is a multibillion dollar industry and when you look at guys like Joe Thomas with Patrick Chung and Harry Douglas and others that we have put in the front offices. These are guys that have played on the on the field of Battle and know exactly how to think about the guys that are playing today and so they're providing real.

<unk> expertise to those that are already staking teams I would encourage you you know as the draft and leading up to the draft to go and stay could team our Ohio goods team has staked out but as we continue to stick more teams, we may reopen that and that's a good sign that the demand is already there without even knowing the teams because of the faith in the bran.

And the faith in the front offices and drill Davis as our commissioner a lot of credibility around this week, but more importantly, I think we're bringing an experience that no one has ever had before and.

So even recently our commissioner issued a challenge, where we're offering sort of a match stake for a certain number of staker is coming into our ecosystem.

There is a possibility you know a slight possibility I've talked about before these teams play each other virtually the league is as the schedule is out if you go onto our App.

We also launched you'll see the games and every week and how Theyre being played sports betting could become a part of our ecosystem there as well either this year or next and I think most importantly, it gives us another opportunity to engage with fans at our destination potentially hosting a law.

<unk> draft in the future, although our draft on the 15th will be virtual we did have our camera crew here and Jeff Eisenberg here, capturing a lot of emotion from the players that will be aired during our draft. This coming Sunday, So really excited to continue to build our our gaming environment with our hall.

Fantasy League.

In esports I spoke about this helix complex that we're going to have will host some of the big tournaments around the country and one of those.

We're planning on in the in the near term sort of after the construction of the facility and the <unk>.

Completion of that sort of Q2 next year sports betting is still a big part of what we're doing as I said, where we're monitoring and staying diligent around partnerships and then lastly, you know we added more partners sponsors and we have found a lot of excitement across the different.

Types of sponsorship categories.

We have American standard Hendrickson, you saw we just announced Anheuser Busch as well for our music festival and multiple others in the queue that I think are going to add great value to us in terms of our capabilities, our ability to speak to different audiences and also to monetize and bring more.

<unk> to the bottom line. So a lot of things going on you can certainly look at our two new apps that we launched in partnership with one with venue ties our hall of Fame village App that gives you everything you want to know all the events all of the construction progress updates and then our hall of Fantasy League that keeps you going active with our fantasy launch.

With our draft on the 15th.

Let me now just stop and I'll turn it over to Jason to go over our financial results great. Thanks, Mike and good morning, everyone. We filed our second quarter fiscal 2021 Form 10-Q post market yesterday that document can be found on the SEC website as well as our Investor Relations site.

We also did file a few prospectus supplement last night I just wanted to take a second to point out that these are not new registration payments, but they are required filings to update existing registration statements with information that was contained in our 10-Q.

Having said that let's cover the company's financial results.

Second quarter total revenue was $2.4 million that represents an increase of 39% from the same period last year and 23% sequentially from the first quarter of this year.

Revenue growth was primarily driven by the Doubletree hotel as well as event revenue at the sports complex and Tom Benson Halloween Stadium.

Sponsorship revenue continues to be largely derived from our long term contracts.

Second quarter adjusted EBITDA was a loss of $5.6 million. This was driven by property in hotel operating expenses.

The investments are important as we continue to build a solid foundation across all three of our business verticals, we've been disciplined in prioritizing and balancing operating expenses, while we continue to invest in the growth of our company.

Net income was a positive $15.5 million for the quarter and that was driven by the accounting treatment of warrant liabilities due to the SEC staff for an accounting statement that came out in the second quarter of 2021 will show a decrease liabilities and expense if the companys stock price declines.

Other line items on the financial statements will vary based on the company's stock price. It does not impact our cash flow from operations, our cash and cash equivalents, our liquidity for all prior and future periods.

Let's move over to the balance sheet, we finished the quarter with a cash balance of about $74 million. This compares to about $69 million at the end of the first quarter.

Both of those values are inclusive of our restricted cash balances.

The increase in cash was driven by about $15 million received from the June sale of series E preferred stock and warrants.

Our net debt balance was about $104 million as shown in our notes payable this as compared to $102 million at the end of the first quarter.

Now, let's transition more specifically to construction financing as Mike stated earlier, we have signed several term sheets for portions of certain assets of phase two construction and we continue to have frequent conversations to round out the rest of our phase two construction financing.

The total anticipated construction spend has not changed.

As such we're working to have the optimal portfolio of financing, which provides the ideal structure for the company and our shareholders.

Working through this process doesn't do take time and we continue to work really diligently on this front it will.

We will provide you with more updates as the financing pieces continue to come together and get finalized.

We remain really excited about the rest of 2021 and driving value from the development that we've announced so far this year.

In terms of the overall financials consistent with prior quarters, we're not going to be providing specific financial guidance for this year, our expectations remain unchanged and we still expect revenue to increase this year driven by a few key factors, which include but are certainly not limited to first the doubletree hotel, which will be opera.

<unk> for a full year after opening in November of 2020.

The Doubletree has sequentially improved since it opened last November and we would expect this trend to continue.

Second revenue coming from incremental events of the Tom Benson Halloween Stadium or sports complex and the double tree nuts.

Last weekend, we were able to showcase some of our incredible assets on a national stage and we're working to fully monetize them.

Third we signed multiple new partnership agreements in the third quarter and will begin generating revenue from those deals.

And finally, we will produce incremental revenue from initiatives like the launch event Ftes and tenant ing of the constellation Center for excellence at the end of 2021.

In terms of EBITDA consistent with prior communications, we expect profitability to be marginally better than 2020. However, 2021 will still continue to be an investment year for us.

I do want to reiterate that our longer term goalposts have not moved.

By the time construction of phase two it's fully complete and operational we continue to target $150 million of annual run rate revenue and approximately 55 zero million of annual run rate. Adjusted EBITDA. This is across our key pillars, which again are destination based assets our media platforms.

In our gaming vertical.

Revenue and EBITDA generation is expected to be diversified across multiple streams. Each one of them is intended to drive synergies, which support the ecosystem, we're working hard to build.

<unk> stated earlier, we will work to drive the traffic and attendance needed to capitalize and achieve these financial targets.

Additionally, we view items like E gaming and sports betting as potential upside to our targets and at the very least an offset to any headwinds that may arise.

The company has long term growth file has resonated. This is in part evidenced by increased institutional ownership throughout the first half of 2021, we appreciate all of our shareholders their support of our company and the confidence that they are placing in us as a team to achieve our company's long term growth objectives.

The team continues to execute on our financial priorities that have been communicated we remain committed to maintaining a balance sheet that provides financial flexibility throughout our growth phase that will ultimately deliver long term value to every one of our shareholders.

With that I'll turn it back to Mike who will provide some closing comments.

Thanks, Jason So a couple of key takeaways here Firstly, we are resorts and entertainment company and you've heard me say that before but the important part of that is we're building momentum across all of our business verticals. So you can tell.

By the way in which we're progressing in a very difficult environment that partners of high caliber want to partner with us athletes want to be a part of how we're creating media and digital collectibles.

The events that we're hosting our of the best quality and fans and guests are coming to participate and we are building. This is very real what we're creating is a destination and it takes time.

An interesting statistic that I was given by.

The department of transportation here in 2019 on our property, we hosted a little over 2 million people. Some of that came for a pro football Hall of Fame. Some of that came for our youth sporting events. Our target is to double that over the next few years.

30, plus million vehicles drive by our property on an annual basis and that's on one road that doesn't include our regional airport, which has just expanded and had a significant renovation. It doesn't include other forms of transportation and so when I talk about the optimism for attendance growth.

When you think about those kinds of numbers and the adjacency to tens of millions of people within a 245 hour drive radius I have great confidence that we will be able to achieve our targets as we continue to build these assets construction financing is exactly where we want it to be we are putting.

The pieces of the capital structure in place. So that we can continue to build constructions progressing it has not stopped it is moving forward and we're being pragmatic about that final loan facility in terms of cost and timing I know somebody wanted some people wanted to hear me say, it's there it's done it's in place right now.

I promise you that is the main target for us, but at the same time filling in the rest of our cap stack with public and private financing like tax increment financing tourism development bonding EMEA refinancing pace financing all of these different vehicles afford us an opportunity to lower the cost of our financing and we have been.

Diligent around as Jason just said getting term sheets in place and we look forward to having more of those in the coming weeks.

Covid is there it's still here, but we are making progress and again, focusing our media and our.

Gaming divisions, creating virtual environments and storytelling for our guests to enjoy while they may not be.

As inclined to go into physical destinations in the near term, although travel is still up and hotel bookings are still up.

Uncertain, what we're going to be facing and as again as I've said before we're building at a time, where this uncertainty is creating.

Some of the should I or should I not go places attitude. Once we open it's our hope that this has gone away it's been eradicated and again, what we showed this past weekend was people are starved to be in environments with other like minded sports fans. The first completely sold out football game in over a year.

And it was electric the environment was absolutely fantastic. So COVID-19 has not slowed us down for making progress we stay safe we stay diligent nothing more important about the safety of our employees and our guests over 80% of our employees have been vaccinated, we're encouraging that we're providing them the opportunity to do that we.

We want to make sure as we welcome guests and sports fans youth alike that we're creating a safe environment for them.

And then lastly.

The rest of this year as I look at the calendar in Q3 and Q4 the events just continues to build high.

High School Football Championships, we have the Division three College Football Championship. Our music Festival that we're hosting here in September the Black College Football Hall of Fame classic kicks off as well in September a lot of big events showcasing the wonderful new developments that we have.

Going on and as they come back and they see the progress the guests come back they get more excited about return visitation and that's always been a premise of ours building phases. So that you always have something to talk about and something to execute upon creating excitement for people to want to come back and visit over and over again that in combination with the program.

<unk> that were already developing is really exciting for me.

The president and CEO of the company, we are hiring great talent, we're hiring talent that is booking events and revenue. We're hiring talent that is marketing where hiring talent that is building a talent for our media division and for our gaming Division and so again the team we view it as building a dynasty it takes time.

It takes commitment and we're only going to hire the best so that as we bring people in and they can exponentially increase our capabilities to deliver one of a kind experiences for our fans and guests to enjoy it.

Executing on the winning plays that we talk about a lot and keeping our eye on the future.

I want to thank everybody.

For your your patience I know you want things to be done faster. So do we but we want them to be done right and we want them to be done to sustain over the very long term and to be profitable. So we hope you understand the messaging that we're trying to give to you. This morning and I also want to thank our team. This was an incredible weekend, but we've had an incredible year.

With this team has.

Stayed focus to stay dedicated tirelessly work to execute and I think we've shown good results because of it I'll stop there and open it up for questions now.

Thank you the floor is now open for questions. If you would like to ask a question. Please press star one on your telephone keypad at this time a confirmation tone will indicate your line is in the question queue. You May Press Star two if you would like.

Your question from the queue for participants using speaker equipment and may be necessary to pick up your handset before pressing the therapies. Once again that is star one for any questions at this time.

Our first question is coming from Jack Vander <unk>.

Rd of Maxim Group. Please go ahead.

Okay.

Great. Good morning, guys. Appreciate the quarterly update just a couple of questions for me I'll start a question for Michael on the Hull of Fantasy League with.

With the NFL season, right around the corner and you have these 10 teams that are lined up front offices are established.

Speak a bit more though on the speaking aspect of the league, which is rather unique to other fantasy leagues out there as long as what the fan engagement kind of aspect as to the to the league how the decision making process works and how that how are how decisions are made and incorporated between the front office and the actual stakeholders.

Themselves.

And then maybe a few follow ups to that.

Thanks, Jack and good morning to you too appreciate your dialing in.

Great questions and ones that we're excited about answering you know this is a league that is a league right youre not selecting an individual team and playing against your buddies or your or your family.

In another platform like like ESPN or Yahoo offer we know that our fantasy participants are going to do those things as well because there are a lot of fun, we think though that the fan engagement here is going to be at an all time high.

If you think about what those leagues or about it's about giving your buddies of your family a hard time about their trades and their drafts and you know what were you thinking we have a we have a.

Roll that we call chief trash talking officer, So everybody has the ability to post their thoughts interact with the front offices give their opinions.

Share their thoughts in their community and that's what we're trying to create a community based league where people feel connected to a franchise just very much like the NFL by the way we're selling merchandise you know that allows people to go out in public and route and cheer for their teams I wore my Ohio goats hat to the gas station the other day.

And somebody asked me about what that was and how cool that looked and I explained it to them and they said they were going to go stake staking as a way in which the participants can back a team and also be rewarded if that team wins. So the league itself one of the things. We're proud of is I think it's 90% of all.

All staking that comes into the league gets returned to the participants either in the form of first place winnings. So if you stay could team for $5 and your team wins you win 30 Bucks with six times. The winnings. If you stay could team for $5 and your team comes in second it's 15 Bucks three times.

And if you come in third you'll get your money back. So that's an important point to be made because there are winnings here. We are also anticipating running potential side hustles or bets.

<unk> used the word bet, because it's illegal but opportunities for people to participate in some fun gaming activity and and have the ability to participate from a financial perspective, as well and so there's a lot of things that we're going to roll out the app is going to enable us and we're working on the Android version.

That was a that was a question as well we have the Apple version rolled out and of course, our website, where everybody is coming in and it comes through our partnership the speaking with state Kings were running promotions on state Kings with them now the commissioners challenge out there and we intend to have a law.

Not a fan engagement. This this should be fund it should be engaging it should be teams playing each other on a weekly basis and really you know at the end of the year. The championships games get played and we will have a lot of engagement along the way that the draft should be incredible as well I'm excited to prove that this coming Sunday at five P. M.

Awesome I appreciate the color there and then just a follow up on the NFC side of the business. Maybe can you provide some additional color on your decision process.

Behind the relaunch of the NFL on this new NFL.

Eric if new SP X platform, rather than open sea, maybe just what are some of the factors. The tradeoffs you considered what does this do for you that maybe it's more beneficial.

And then on open fee. Thanks.

Sure.

Again, I should say open sea is a very high quality platform. What we did was listen to we rebated tested there we listened to the feedback from collectors from investors.

It was clear to us that there were a few things we wanted to but we wanted to make these more accessible more accessible meaning being able to purchase with credit card debit card versus crypto currency not a lot of the world uses crypto currency yet.

It's a level of sophistication and purchasing but I think over time will become.

Much more prolific and you see companies like AMC and others getting into that space.

It's interesting to me as well, but we wanted to make accessibility are key for our purchasers and we have MTX offered us an opportunity to create a unique marketplace for us. It also has a secondary market. We're seeing a lot of the ftes that are already sold by the way in.

Hundreds as I mentioned now being sold on the secondary market as well and from a financial point of view not only do we get the revenue from the first sale, but every other sale down the line and so you know this was a.

Our beta that we tried and we wanted to see how the how it would work again. This is a marketplace that is evolving almost daily and you see everybody sort of dipping their toe into it and we want to make good decisions that lost over a very long period of time. The most important thing is great creative give.

People, a chance to own a piece of history and our Playbooks. If you see them really do the wonderful thing about it is the voice of the athlete talking about the play that was one of the most important place to them and their football playing history. We went to them and we said hey give us some thoughts around the most defining play.

Is that you can remember so these arent just things that are made up these are the players when you ask Marcus Allen Earl Campbell or Tim.

Tim Brown or Joe guidance, yet these are guys, saying I remember that play and it was so impactful and so we had creative around it and we told the story. They told the story in their voice, which I think makes our product very unique and different. So it was a lot of things again, we're still evolving. This you know we want to make it easier.

And easier, we're going to be adding more product to our marketplace, we want to create that secondary market.

That allows guests to continue to sell and buy and make these things even more collectible, but it's a business that we anticipate growing and growing in a very pragmatic way, but launching with this round was important and I think we've shown it to be successful.

And Jack just to jump in and Keith I just wanted to go back to the Hull of fantasy, we'd really really quick around us taking side I believe we said first places a six times theyre invest or their initial stake second place of three times. Its actually two times and then third places one times. So just to avoid any confusion there thanks for that correction.

I appreciate the follow up there and Mike I appreciate the color on your end if T side.

Maybe just one more quick question from me on on kind of esports gaming and entertainment plans, you've the helix center that you've agreed but he's worked entertainment group to put it into your your village and that's.

That sounds like a nice development, that's going to be coming in 2022.

Can you just talk about maybe how your other plants and how this is broke into your overall your other offerings with esports and gaming Center and then obviously you've mentioned the sports betting.

Potential in the future, but just how does this fit into your overall planning offerings when if I'm a guests that come to the village and I go stand the Doubletree hotel and they can go play games at the gaming Center like Helix has and just it's really intriguing how it all comes together, but curious to get your thoughts there yeah.

Yeah, and look I would say that every time, we make a decision in one business unit, we always think about how do we create uplift through the others right and so esports is a good example of that there are so many esports gaming tournaments being live streamed on Twitch and other distribution channels, we absolutely anticipate.

Having the ability to do that through our media company as well.

On site of course, I referenced a lot our large youth sports program you can imagine these kids coming here and looking for great things to do while they're staying with us playing esports as a part of that right you could imagine challenges with some of the best to ever play the sport against some of the youth athletes.

While they're here and having fun tournaments like that and also maybe becoming media content for us and so we.

We're looking at this as a very synergistic business development opportunity, but again it drives traffic to the destination. It provides entertainment and it allows fans to engage with sport and in some cases in particular football and it enhances our offerings to our guests here. The other thing that we've spoken of.

About what's on the horizon.

Horizon that we're looking at are.

Not there yet, but we're looking at is Offsite asset development and when I think about Offsite asset development and sort of mini replications of Hall of Fame professional football Hall of Fame.

Potentially in NFL cities with memorabilia food and beverage E sports can become a very key component of that and you're talking about a company in esports Entertainment group that has proven to have those capabilities and expanding around the country and running tournaments around the country. So we're excited to think hey, we do an offside.

Asset development strategy, they could become a part of that programming as well.

Got it I appreciate the color that's it for me I'll hop back in the queue. Thanks, great. Thanks, Jack Thanks, Jack.

Thank you at this time I would like to turn the floor back over to Mr. Griffin for closing comments.

Yeah, we actually have a few more questions so you'll join us.

A question came in that math, what are our thoughts regarding where sports betting legislation currently is in Ohio, and Additionally, how beneficial could that be.

When they come.

Yeah. So what I said earlier, we stay very closely connected with key legislators and if you look at the bill. They are presenting there are multiple different types of licenses that theyre offering.

Brick and mortar license mobile license.

As we talk with sports betting partners both.

Partners that have a presence in Ohio today, and those that don't or a minimal presence.

Our ability we're meeting as the Bill is written our company meets the qualifications to have those licenses.

And that's important right, it's a strategic advantage for us.

Because we are creating economic uplift in job creation and in a county in the state that has a certain population we have the ability to obtain those licenses that can be very attractive to a partner looking to gain entry into Ohio, who are looking to expand their footprint in Ohio.

I'm not the legislators. So all we can do is stay connected to it as we have a track. It we have consultants, helping us do that as well and really have meaningful conversations with our potential partners and look for the best opportunity for our company I think an onsite physical location.

<unk> can come and enjoy an environment of sports and enthusiasm in place, but it's something that would be great for us.

And can drive economics for our destination, our hall of Fame village.

Potentially mobile has a much broader reach allowing us to drive even greater revenue too.

To our company through that type of partnership and with that license, but important to remember the number that Jason the numbers that Jason had quoted 150 and 50 do not include sports betting so.

It either helps mitigate some of the risk that's out there that we have to face in construction or it helps enhance those numbers and are yet to be determined which one it is.

Another question come in asking how much revenue and profit.

From the events and all of that happening in southern China.

So too early to tell I mean, it's just a few days removed, but I can tell you that.

For the most part all of what we generate is predominantly profit.

You know the expensive advantage through partnership with the NFL with the pro Football Hall of Fame and even the city of Canton and so a lot of that is put on by our partners our content partners.

<unk> benefit through concession sales admission sales.

Direct.

Impact to our hotel other private events that are being hosted and so.

So we anticipate a.

Good uplift from that size of an event just as we would from a concert or from any other type of event that scale that we'd be hosting here on property.

Well with that that will conclude our earnings call for Q2 of 2021 I want to thank on behalf of the company everyone for joining us.

Reporting all of that.

Thanks Allison.

Okay.

Ladies and gentlemen, thank you for your participation. This concludes today's event you may disconnect. Your lines of all golf club webcast at this time and have a wonderful day.

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Okay.

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