Bally's Corp (BALY) Risk Factors

ITEM 1A.RISK FACTORS

In addition to the other information contained in this Annual Report on Form 10-K, the following risk factors should be

considered carefully in evaluating our business. If any of the following risks actually occur, our business, financial condition

and results of operations could be adversely affected. If this were to happen, the value of our securities, including our common

stock, could decline significantly, and investors could lose all or part of their investment.

Risk Factor Summary

Our business is subject to a number of risks and uncertainties, including those highlighted in this item in this Annual Report on

Form 10-K. Some of these principal risks include the following:

General Economic Conditions

•Our business is particularly sensitive to reductions in discretionary consumer spending.

Competition

•The gaming industry, including retail casinos and iGaming, is very competitive and increased competition, including

through legislative legalization or expansion of gaming by states in or near where we own facilities or through Native

American gaming facilities, could adversely affect our financial results.

•Portions of our operations are dependent on government contracts, which are generally awarded following lengthy and

competitive government bidding processes and include performance guarantees.

Compliance, Regulatory and Legal Risks

•We are subject to extensive laws, regulation and licensing, and gaming authorities have significant control over our

operations, which could have an adverse effect on our business.

•Failure to comply with the terms of the Regulatory Agreement could result in a breach and could harm our business.

•We are subject to extensive environmental regulation, which creates uncertainty regarding future environmental

expenditures and liabilities.

•We or certain third parties that we rely on may fail to establish and maintain effective and compliant anti‑money

laundering, counter terrorism financing, safer gambling, fraud detection, risk management and other regulatory

policies, procedures and controls.

•Our business is subject to a variety of US and foreign laws, many of which are unsettled and still developing, and

which could subject us to claims or otherwise harm our business across jurisdictions which could have a material

adverse effect on our financial condition and results of operations.

•Our growth prospects depend on the legal status of real money gaming in various jurisdictions and legalization may

not occur in as many jurisdictions as we expect or may occur at a slower pace than we anticipate which could

adversely affect our future results of operations.

Business Operational Risks

•We are reliant on effective payment processing services from a limited number of providers in each of the markets in

which we operate.

•Our profitability will be dependent, in part, on return to players.

•We extend credit to a portion of our customers, and we may not be able to collect gaming receivables from our credit

customers.

•Declining popularity of games and changes in device preferences of players could have a negative effect on our

business.

•The casino, hotel and hospitality industry is capital intensive and we may not be able to finance development,

expansion and renovation projects, which could put us at a competitive disadvantage.

•We are subject to various construction and development risks in connection with our current and future construction

projects.

•We may invest in or acquire other businesses, and our business may suffer if we are unable to successfully integrate

acquired businesses into our company or otherwise manage the growth associated with multiple acquisitions.

•We face risks associated with growth and acquisitions.

•Negative perceptions and publicity surrounding the lottery industry could lead to increased regulation.

•Our management identified material weaknesses in our internal control over financial reporting which could, if not

remediated, result in material misstatements in our consolidated financial statements.

•We may be unable to protect our intellectual property rights.

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•Our results of operations and financial condition could be adversely affected by the occurrence of natural disasters,

such as hurricanes, or other catastrophic events, including war, terrorism and public health crises such as the

COVID-19 pandemic.

Cybersecurity, Data Privacy and Technology Risks

•We rely on information technology, Internet infrastructure and other systems and platforms, and any failures, errors,

defects or disruptions in our systems or platforms could diminish our brand and reputation, subject us to liability,

disrupt our business, affect our ability to scale our technical infrastructure and adversely affect our operating results

and growth prospects.

•Our business may be harmed by cybersecurity and data privacy incidents.

•We may use AI in our business, and challenges with properly managing its use could result in reputational harm,

competitive harm and legal liability, and could have adverse effects on our business, operating results, and financial

condition.

Financing Risks

•Our debt agreements, the Regulatory Agreement and other future indebtedness contain or may contain restrictive

covenants that may limit our operating flexibility.

•Servicing our indebtedness and funding our other obligations requires a significant amount of cash, and our ability to

generate sufficient cash depends on many factors, some of which will be beyond our control.

Risks Related to our Common Stock

•The market price of our common stock could fluctuate significantly.

•Our largest shareholder owns a majority of our outstanding common stock, which could limit the ability of other

shareholders to influence corporate matters.

•We are a “controlled company” within the meaning of the corporate governance standards of NYSE. As a result, we

qualify for exemptions from certain corporate governance standards and our shareholders do not have the same

protections afforded to shareholders of companies that are subject to such requirements.

•We are not paying dividends and any decision to do so in the future will be at the discretion of our Board.

General Economic Conditions

Our business is particularly sensitive to periodic reductions in discretionary consumer spending.

Our business is particularly sensitive to periodic reductions in discretionary consumer spending. Demand for entertainment and

leisure activities, including gaming, can be affected by changes in the economy and consumer tastes, both of which are difficult

to predict and beyond our control. Unfavorable changes in general economic conditions, including recessions, economic

slowdowns, sustained high levels of unemployment and rising prices or the perception by consumers of weak or weakening

economic conditions, may reduce our users’ disposable income or result in fewer individuals engaging in entertainment and

leisure activities, such as visiting casinos and casino hotel properties, free-to-play games, sports betting, iCasino and online

bingo. A period of sustained inflation, particularly in the US, European Union (“EU”) and UK, could materially impact our

business. The effects of inflation on discretionary consumer spending could result in the reduction of the demand for

entertainment and leisure activities. Moreover, we rely on the strength of regional and local economies in the US for the

performance of each of our properties. As a result, we cannot ensure that demand for our offerings will remain constant.

Adverse developments affecting economies throughout the world including a general tightening of the availability of credit,

increasing energy costs, rising prices, inflation, acts of war or terrorism, natural disasters, declining consumer confidence,

significant declines in the stock market or epidemics, pandemics or other health-related events or widespread illnesses, like the

COVID-19 pandemic, could lead to a reduction in visitors to our properties, including those that stay in our hotels, or

discretionary spending by our customers on entertainment and leisure activities, which could adversely affect our business,

financial condition and results of operations.

Competition

The gaming industry, including retail casinos and iGaming, is very competitive and increased competition, including

through legislative legalization or expansion of gaming by states in or near where we own facilities or through Native

American gaming facilities, could adversely affect our financial results.

We face significant competition in all areas in which we conduct our business. Increased competitive pressures may adversely

affect our ability to continue to attract customers or affect our ability to compete efficiently.

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Several of our casinos and resorts are in jurisdictions that restrict gaming to certain areas and/or may be affected by state laws

that currently prohibit or restrict gaming operations. We also face the risk that existing casino licensees will expand their

operations and the risk that Native American gaming will continue to grow. Budgetary and other political pressures faced by

state governments could lead to intensified efforts directed at the legalization of gaming in jurisdictions where it is currently

prohibited. The legalization of gaming in such jurisdictions could be an expansion opportunity for our business, or create

competitive pressures, depending on where the legalization occurs and our ability to capitalize on it. Our ability to attract

customers to the existing casinos which we own could be significantly and adversely affected by the legalization or expansion

of gaming in certain jurisdictions and by the development or expansion of Native American casinos in areas where our

customers may visit.

In addition, our competitors may refurbish, rebrand, or expand their casino offerings, which could result in increased

competition. Furthermore, changes in ownership may result in improved quality of our competitors’ facilities, which may make

such facilities more competitive. Certain of our competitors are large gaming companies with greater name recognition,

marketing efforts and financial resources. In some instances, particularly in the case of Native American casinos, our

competitors pay lower taxes or no taxes. These factors create additional challenges for us in competing for customers and

accessing cash flow or financing to fund improvements for our casino and entertainment products that enable us to remain

competitive.

We also compete with other forms of legalized gaming and entertainment such as bingo, pull-tab games, card parlors,

sportsbooks, pari-mutuel or simulcast betting on horse and dog racing, state-sponsored lotteries, instant racing machines, VLTs

(including racetracks that offer VLTs) and video poker terminals and, in the future, we may compete with gaming or

entertainment at other venues. Further competition from online lotteries and other online wagering gaming services, which

allow their customers to wager on a wide variety of sporting events and play Las Vegas-style casino games from home, could

divert customers from the facilities we own and thus adversely affect our business. Such online wagering services are likely to

expand in future years and become more accessible to domestic gamblers as a result of US Department of Justice positions

related to the application of federal laws to intrastate online gaming and initiatives in some states to consider legislation to

legalize intrastate online wagering. The law in this area has been rapidly evolving, and additional legislative developments may

occur at the federal and state levels that would accelerate the proliferation of certain forms of online gaming in the US.

We may also face competition from other gaming facilities which are able to offer sports wagering services (including mobile

sports wagering) following the enactment of applicable legislation. Numerous states that border the states in which we operate

have pending or proposed legislation which would allow for sports betting, each of which could have an adverse effect on our

financial results.

The online gambling industry is highly competitive and we expect more competitors to enter the sector. With several thousand

online gambling sites accessible to potential customers around the world with little product differentiation, there is arguably an

excess of suppliers. Online and offline advertising is widespread, with operators competing for affiliates and customers who are

attracted by sign-up bonuses and other incentives.

Existing and new competitors may also increase marketing spending, including to unprofitable levels, in an attempt to distort

the online gambling market to build market share quickly. Some of our competitors have or will have significantly greater

financial, technical, marketing and sales resources and may be able to respond more quickly to changes in customer needs.

Additionally, these competitors may be able to devote a greater number of resources to the enhancement, promotion and sale of

their games and gaming systems. Our future success is or will be dependent upon our ability to retain our current customers and

to acquire new customers. Failure to do so could result in a material adverse effect on our business, financial condition and

results of operations.

Portions of our operations are dependent on government contracts, which are generally awarded following lengthy and

competitive government bidding processes and include performance guarantees.

We routinely engage in lengthy and highly competitive government bidding processes, which have resulted in contracts with

government entities across various jurisdictions. Our contracts contain terms and conditions and performance guarantees that

we must comply with throughout their term. Any delays in project execution could expose us to the risk of financial liabilities,

including the payment of damages and/or increased insurance premiums associated with the performance guarantees, which

could materially adversely affect our business.

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Compliance, Regulatory and Legal Risks

We are subject to extensive laws, regulation and licensing, and gaming authorities have significant control over our

operations, which could have an adverse effect on our business.

Our ownership and operation of casino gaming, horse racing facilities, sports betting, VLTs and online offerings are subject to

extensive regulation, and regulatory authorities have broad powers with respect to the licensing of these businesses, and may

revoke, suspend, condition, fail to renew or limit our gaming or other licenses, impose substantial fines and take other actions,

each of which poses a significant risk to our business, results of operations and financial condition. We currently hold all

licenses and related approvals necessary to conduct our present operations but must periodically apply to renew many of these

licenses and registrations and have the suitability of certain of our directors, officers and employees renewed. There can be no

assurance that we will be able to obtain such renewals or that we will be able to obtain future approvals that would allow us to

expand our gaming operations. Any failure to maintain or renew existing licenses, registrations, permits or approvals would

have a material adverse effect on us. As we expand our gaming operations in our existing jurisdictions or to new areas, we may

have to meet additional suitability requirements and obtain additional licenses, registrations, permits and approvals from

gaming authorities in these jurisdictions. The approval process can be time-consuming and costly and we cannot be sure that we

will be successful. In addition, the loss of a license in one jurisdiction could trigger the loss of a license or affect our eligibility

for a license in another jurisdiction. Furthermore, if additional gaming laws or regulations are adopted in jurisdictions where we

operate, these regulations could impose additional restrictions or costs that could have a significant adverse effect on us.

Gaming authorities can generally require that any beneficial owner of our securities file an application for a finding of

suitability. If a gaming authority requires a record or beneficial owner of our securities to file a suitability application, the

owner must generally apply for a finding of suitability within 30 days or at an earlier time prescribed by the gaming authority.

The gaming authority has the power to investigate such an owner’s suitability and the owner must pay all costs of the

investigation. If the owner is found unsuitable, then the owner may be required by law to dispose of our securities.

Our officers, directors and key employees are also subject to a variety of regulatory requirements and various licensing and

related approval procedures in the various jurisdictions in which we operate. If any applicable gaming authority were to find

any of our officers, directors or key employees unsuitable for licensing or unsuitable to continue having a relationship with us,

we would have to sever all relationships with that person. Furthermore, the applicable gaming authority may require us to

terminate the employment of any person who refuses to file appropriate applications. Either result could adversely affect our

gaming operations.

Applicable gaming laws and regulations may restrict our ability to issue certain securities, incur debt and undertake other

financing activities. Such transactions would generally require notice and/or approval of applicable gaming authorities, and our

financing counterparties, including lenders, might be subject to various licensing and related approval procedures in the various

jurisdictions in which we conduct gaming operations. Applicable gaming laws further limit our ability to engage in certain

competitive activities and impose requirements relating to the composition of our Board and senior management personnel. If

gaming regulatory authorities were to find any person unsuitable with regard to their relationship to us or any of our

subsidiaries, we would be required to sever our relationship with that person, which could materially adversely affect our

business.

We are subject to numerous laws that may expose us to liabilities or have a significant adverse impact on our operations.

Changes to any such laws could have a material adverse effect on our operations and financial condition.

Our business is subject to a variety of laws, rules, regulations, and ordinances. These laws and regulations include, but are not

limited to, restrictions and conditions concerning alcoholic beverages, environmental matters, employees, currency transactions,

taxation, anti-money laundering measures, vulnerable customer protections, data privacy, zoning and building codes and

marketing and advertising and game design. Such laws and regulations could change or could be interpreted differently in the

future, or new laws and regulations could be enacted. Material changes to any of the laws, rules, regulations or ordinances to

which we are subject, new laws or regulations or material differences in interpretations by courts or governmental authorities

could have an adverse effect on our business, financial condition and results of operations.

Many of our employees, especially those that interact with our customers, receive a base salary or wage that is established by

applicable laws that establish a minimum hourly wage that is, in turn, supplemented through tips and gratuities from customers.

From time to time, lawmakers have increased the minimum wage. It is difficult to predict when such increases may take place.

Any such change to the minimum wage could have a material adverse effect on our business, financial condition and results of

operations.

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The sale of alcoholic beverages is a highly regulated and taxed business. In the US, federal, state and local laws and regulations

govern the production and distribution of alcoholic beverages, including permitting, licensing, trade practices, labeling,

advertising, marketing, distributor relationships and related matters. Federal, state and local governmental entities also levy

various taxes, license fees and other similar charges and may require bonds to ensure compliance with applicable laws and

regulations. Failure to comply with applicable federal, state or local laws and regulations could result in higher taxes, penalties,

fees and suspension or revocation of permits, licenses or approvals and could have a material adverse effect on our business,

financial condition and results of operations. From time to time, local and state lawmakers, as well as special interest groups,

have proposed legislation that would increase the federal and/or state excise tax on alcoholic beverages or certain types of

alcoholic beverages. If federal or state excise taxes are increased, we may have to raise prices to maintain our current profit

margins. Higher taxes may reduce overall demand for alcoholic beverages, thus negatively impacting sales of our alcoholic

beverages at our properties. Further federal or state regulation may be forthcoming that could further restrict the distribution and

sale of alcohol products. Any material increases in taxes or fees or the adoption of additional taxes, fees or regulations could

have a material adverse effect on our business, financial condition and results of operations.

Legislation in various forms to ban or substantially curtail indoor tobacco smoking in public places have been enacted or

introduced in many jurisdictions, including some of the jurisdictions in which we operate. We believe these smoking

restrictions can significantly impact business volumes. If additional smoking restrictions are enacted within jurisdictions where

we operate or seek to do business, our financial condition, results of operations and cash flows could be adversely affected.

In addition, each restaurant we operate must obtain a food service license from local authorities. Failure to comply with such

regulations could cause our licenses to be revoked or our related restaurant business or businesses to be forced to cease

operations. Moreover, state liquor laws may prevent the expansion of restaurant operations into certain markets.

Failure to comply with the terms of the Regulatory Agreement could result in a breach and could harm our business.

We are currently a party to the Regulatory Agreement with Rhode Island regulatory agencies. The Regulatory Agreement

imposes certain affirmative and negative covenants on us. For more detail on the Regulatory Agreement see the section entitled

“Governmental Gaming Regulation” in “Item I. Business” of this Annual Report on Form 10-K. A failure to comply with the

provisions in the Regulatory Agreement could subject us to injunctive or monetary relief, payments to the Rhode Island

regulatory agencies and ultimately the revocation or suspension of our licenses to operate in Rhode Island. Any such remedy

could adversely affect our business, financial condition and results of operations. Among other things, the Regulatory

Agreement prohibits us and our subsidiaries from owning, operating, managing or providing gaming specific goods and

services to any gaming facilities in Rhode Island (other than Bally’s Twin River and Bally’s Tiverton), Massachusetts,

Connecticut or New Hampshire, which may adversely affect our growth and market opportunity in those states.

We are subject to extensive environmental regulation, which creates uncertainty regarding future environmental

expenditures and liabilities.

We are subject to various environmental laws and regulations that govern activities that may have adverse environmental

effects, such as discharges to air and water, as well as the management and disposal of solid, animal and hazardous wastes and

exposure to hazardous materials. These laws and regulations, which are complex and subject to change, include US

Environmental Protection Agency regulations. In addition, our horse racing facility in Colorado is subject to state laws and

regulations that address the impacts of manure and wastewater generated by concentrated animal feeding operations (“CAFO”)

on water quality, including storm water discharges. CAFO regulations include permit requirements and water quality discharge

standards. Enforcement of CAFO regulations has been receiving increased governmental attention. Compliance with these and

other environmental laws can, in some circumstances, require significant capital expenditures. For example, we may incur

future costs under existing and new laws and regulations pertaining to storm water and wastewater management at our

racetracks. Moreover, violations can result in significant penalties and, in some instances, interruption or cessation of

operations.

We are also subject to laws and regulations that create liability and cleanup responsibility for releases of regulated materials

into the environment. Certain of these laws and regulations impose strict, and under certain circumstances joint and several,

liability on the current or previous owner or operator of property for the costs of remediating regulated materials on or

emanating from our property. The costs of investigation, remediation or removal of those substances may be substantial. The

presence of, or failure to remediate properly, such materials may adversely affect the ability to sell or rent such property or to

borrow funds using such property as collateral. Additionally, as an owner or manager of real property, we could be subject to

claims by third parties based on damages and costs resulting from environmental contamination at or emanating from third-

party sites. These laws typically impose clean-up responsibility and liability without regard to whether the owner or manager

knew of or caused the presence of the contaminants and the liability under those laws has been interpreted to be joint and

several unless the harm is divisible and there is a reasonable basis for allocation of the responsibility. In addition, environmental

requirements address the impacts of development on wetlands.

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The possibility exists that contamination, as yet unknown, may exist on our properties. There can be no assurance that we will

not incur expenditures for environmental investigations or remediation in the future.

We are or may become involved in legal proceedings that, if adversely adjudicated or settled, could impact our business and

financial condition.

From time to time, we are named in lawsuits or other legal proceedings relating to our businesses. In particular, the nature of

our business subjects us to the risk of lawsuits filed by customers, past and present employees, shareholders, competitors,

business partners and others in the ordinary course of business. As with all legal proceedings, no assurances can be given as to

the outcome of these matters. Moreover, legal proceedings can be expensive and time consuming, and we may not be successful

in defending or prosecuting these lawsuits, which could result in settlements or damages that could adversely affect our

business, financial condition and results of operations.

We or certain third parties that we rely on may fail to establish and maintain effective and compliant anti-money laundering

(“AML”), counter terrorism financing, safer gambling, fraud detection, risk management and other regulatory policies,

procedures and controls.

We operate under extremely stringent regulatory requirements in relation to our land-based casinos and online operations,

particularly so in both the United States and the United Kingdom. Regulatory authorities including US agencies and the Great

Britain Gambling Commission (“GBGC”) have increased scrutiny, with the GBGC’s 2025 enforcement priorities shaped by the

2023 White Paper and driven by automation, real‑time monitoring, and specific customer thresholds. We handle significant

amounts of cash in our land-based operations and see a high volume of digital money transactions in our online operations and

are subject to various reporting and AML laws and regulations. Recently, US governmental authorities and the GBGC, have

evidenced an increased focus on compliance with AML laws and regulations in the gaming industry, with the GBGC having

completed a series of high-profile enforcement action against both online operators and land-based casinos for AML failures. In

the UK, safer gambling obligations require operators to identify and act upon indicators of harm in a timely manner, proactively

monitor at risk customers, and adhere to new technical standards. Any violation of AML laws or regulations or of safer

gambling requirements could have a material adverse effect on our business, financial condition and results of operations.

Internal control policies and procedures and employee training and compliance programs that we have implemented to deter

prohibited practices may not be effective in prohibiting our customers, employees, contractors or agents from violating or

circumventing our policies and the law. If we or our employees or agents fail to comply with applicable laws or our policies

governing our operations, we may face investigations, prosecutions and other legal proceedings and actions which could result

in fines, license restrictions, civil penalties, administrative remedies and criminal sanctions. Any such government

investigations, prosecutions or other legal proceedings or actions could have a material adverse effect on our business, financial

condition and results of operations.

The regulatory framework which governs our business, and its interpretation, may be subject to change which we may fail to

anticipate and/or respond to.

Online and land-based gambling operators licensed in the UK and other jurisdictions are obliged to establish and maintain

compliant AML, anti-terrorism, safer gambling, fraud detection, risk management and other regulatory policies, procedures and

controls to mitigate and effectively manage these risks. In the event that they fail to do so, they may be subject to enforcement

action by gambling regulators or other governmental agencies or private action by affected third parties. In the event of a

breach, a range of sanctions may be imposed, including financial penalties or regulatory settlements, public warnings, the

imposition of special operating conditions or license conditions and the suspension or revocation of gambling licenses.

In addition, there is a risk that increased AML regulatory and safer gambling measures in the UK will prove to be challenging

for us. Financial vulnerability checks have been introduced by the GBGC on customers with £150 net deposits over 30 rolling

days based on publicly available data regarding customers. Further financial risk assessments are being considered by the

GBGC to assess the risk of harm of gambling in the context of high-spending remote gambling customers. If we are required to

conduct further financial risk checks on our highest value customers based on non-public information, some may be unwilling

to provide the additional information and/or documentation to ascertain their sources of wealth, the affordability of their leisure

spending with us or their risk of gambling related harm or vulnerability, and to continue to verify such information.

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We hold licenses issued by the GBGC. The holders of such licenses are bound to meet stringent compliance requirements

relating to matters such as AML, safer gambling, data protection, advertising and consumer rights issues. Compliance with such

requirements is incorporated into the relevant licenses as a licensing condition (or similar) with a corresponding requirement for

us to comply with various requirements. In September 2022, the GBGC began the implementation of updated social

responsibility licensing conditions. All licensees must now have in place effective systems and processes to monitor customer

activity to identify harm or potential harm associated with gambling, from the point when an account is opened. The indicators

licensees must use to identify harm or potential harm associated with gambling include customer spend, patterns of spend, time

spent gambling, gambling behavior indicators, customer-led contact, use of gambling management tools and account indicators.

These requirements may significantly impact our business if we are unable to establish the affordability of customers on the

basis of available evidence and/or because customers are unwilling to provide the information requested.

The failure by any third-party providers or any relevant entity within the Company to establish and maintain effective and

compliant AML, counter terrorism, anti-bribery, fraud detection, regulatory compliance and risk management processes may

have a material adverse effect on our business, financial condition and results of operations.

In carrying out its functions, the GBGC is under a statutory duty to ensure that license holders are operating their businesses in

ways that are reasonably consistent with the licensing objectives set out in the Gambling Act 2005 (currently the primary

legislation governing the licensing and regulation of gambling in Great Britain) (the “Gambling Act”), which are: (1)

preventing gambling from being a source of (or associated with) crime or disorder, or being used to support crime; (2) ensuring

that gambling is conducted in a fair and open way; and (3) protecting children and other vulnerable people from being harmed

or exploited by gambling.

While the objectives of regulation may remain largely stable, the methods that operators are required to employ to meet those

objectives, and the interpretation of those objections by the regulator, are in a state of constant evolution and development. We

must respond adequately to the challenges this presents. If we are found to be in breach of our obligation to comply with such

licensing requirements, then the GBGC may impose a financial penalty on us or impose other sanctions, including removing or

imposing conditions on the relevant gambling licenses. Such action could have a material adverse effect on our financial

performance.

New legislation governing the online gaming industry may be introduced in the UK which limits or restricts our operating

model in that market.

In December 2020, the UK government commenced a review of the Gambling Act. As a result of this review, in April 2023 the

UK government issued proposals to amend the Gambling Act, and these proposals are subject to a series of public

consultations. The UK government proposals are structured around six main themes: (1) online player protections regarding

players and products; (2) marketing and advertising; (3) the powers of the GBGC; (4) dispute resolution and consumer redress;

(5) children and young adults; and (6) land-based gambling. Changes have been introduced, including direct marketing

restrictions on communications with remote gambling customers, new remote game design requirements, financial vulnerability

checks, maximum stake limits, RTS security requirements and provisions on customer deposit prompts and reviews. A statutory

levy to fund research, prevention and treatment of gambling harm has been implemented in place of the previous voluntary

system. There is a risk that the introduction of more stringent, safer gambling and/or AML regulatory measures in the UK may

prove operationally onerous for us. Moreover, the potential for the introduction of further stake, speed and prize limits and the

introduction of deposit, loss and spend limits may operate to impact our financial performance and reduce the long-term growth

opportunities for us in the UK.

The United Kingdom gambling market is undergoing significant regulatory and fiscal changes that may materially impact the

profitability and operations of operators licensed by GBGC. The UK government has implemented major increases in gambling

tax revenues, resulting in a more restrictive and costly operating environment. Effective from April 1, 2026, the Remote

Gaming Duty (RGD) applicable to online gaming revenues, including online slots and casino games, increased from 21% to

40%. Effective from April 1, 2027, the General Betting Duty for remote betting will increase from 15% to 25%, other than for

remote bets on UK horse racing which will remain unchanged. These taxation increases materially raise the tax burden on

remote gambling operators and may significantly reduce operating margins and cash flows generated from UK online gaming

activities. There can be no assurance that operators will be able to offset these increased costs through pricing, operational

efficiencies, or other measures. As a result, these regulatory and fiscal developments could materially and adversely affect our

financial performance.

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Our business is subject to a variety of US and foreign laws, many of which are unsettled and still developing, and which

could subject us to claims or otherwise harm our business across jurisdictions. Any change in existing regulations or their

interpretation, or the regulatory or prosecutorial climate applicable to our products and services, or changes in tax rules and

regulations or interpretation thereof related to our products and services, could adversely impact our ability to operate our

business as currently conducted or as we seek to operate in the future, which could have a material adverse effect on our

financial condition and results of operations.

We are generally subject to laws and regulations relating to iGaming in the jurisdictions in which we conduct business, as well

as the general laws and regulations that apply to all e-commerce businesses, such as those related to privacy and personal

information, tax and consumer protection. These laws and regulations vary by jurisdiction, and future legislative and regulatory

action, court decisions or other governmental action, which may be affected by, among other things, political pressures,

attitudes and climates, as well as personal biases, may have a material impact on our operations and financial results. Some

jurisdictions have introduced regulations attempting to restrict or prohibit online gaming, while others have taken the position

that online gaming should be licensed and regulated and have adopted or are in the process of considering legislation and

regulations to enable that to happen. The regulatory environment in any particular jurisdiction may change in the future and any

such change could have a material adverse effect on our results of operations.

Future legislative and regulatory action, and court decisions or other governmental action, may have a material impact on our

operations and financial results. Governmental authorities could view us as having violated local laws, despite our efforts to

obtain all applicable licenses or approvals. There is also risk that civil and criminal proceedings, including class actions brought

by or on behalf of prosecutors or public entities or incumbent monopoly providers, or private individuals, could be initiated

against us, Internet service providers, credit card and other payment processors in the iGaming industry. Such potential

proceedings could involve substantial litigation expense, penalties, fines, seizure of assets, injunctions or other restrictions

being imposed upon our licensees or other business partners, while diverting the attention of key executives. Such proceedings

could have a material adverse effect on our business, financial condition and results of operations, as well as impact our

reputation.

Our growth prospects depend on the legal status of real money gaming in various jurisdictions and legalization may not

occur in as many jurisdictions as we expect, or may occur at a slower pace than we anticipate. Additionally, even if

jurisdictions legalize real money gaming, this may be accompanied by legislative or regulatory restrictions and/or taxes that

make it impracticable or less attractive to operate in those jurisdictions, or the process of implementing regulations or

securing the necessary licenses to operate in a particular jurisdiction may take longer than we anticipate, which could

adversely affect our future results of operations and make it more difficult to meet our expectations for financial

performance.

Several jurisdictions have legalized or are currently evaluating the legalization of real money gaming, and our business,

financial condition, results of operations and business prospects are significantly dependent upon the status of legalization in

these jurisdictions. Our business plan is partially based upon the legalization of real money gaming in additional jurisdictions

and the legalization may not occur as anticipated. Additionally, if a large number of additional jurisdictions enact real money

gaming legislation and we are unable to obtain, or are otherwise delayed in obtaining, the necessary licenses to operate iGaming

websites in jurisdictions where such games are legalized, our future growth in iGaming could be materially impaired.

As we enter new jurisdictions, governments may legalize real money gaming in a manner that is unfavorable to us. As a result,

we may encounter legal, regulatory and political challenges that are difficult or impossible to foresee and which could result in

an unforeseen adverse impact on planned revenues or costs associated with the new opportunity. Jurisdictions also impose

substantial tax rates on iGaming revenue. Tax rates, whether federal- or state-based, that are higher than we expect will make it

more costly and less desirable for us to launch in a given jurisdiction, while tax increases in any of our existing jurisdictions

may adversely impact profitability.

Therefore, even in cases in which a jurisdiction purports to license and regulate iGaming, the licensing and regulatory regimes

can vary considerably in terms of business-friendliness, and at times may be intended to provide incumbent operators with

advantages over new licensees. Therefore, some “liberalized” regulatory regimes are considerably more economically viable

than others.

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We derive revenues from players located in jurisdictions in which we do not hold a license.

In certain jurisdictions, online gambling is either not regulated at all, is subject to very limited regulation or its legality is

unclear. These jurisdictions are commonly referred to in the gaming industry as “unregulated jurisdictions” as it is not possible

to obtain a license. Certain of our products are made available to players in unregulated jurisdictions. The relevant transactions

in such unregulated jurisdictions and the associated player relationships that underpin them are generally regulated by “point of

supply” gambling regimes. We hold a point-of-supply license in Gibraltar and therefore, transactions are in fact heavily

regulated but are not themselves regulated in the jurisdiction within which the player is ultimately located.

Operators within the online gambling industry, including Bally’s, have commonly taken a risk-based approach when supplying

their online gambling services into jurisdictions in which it is not possible to obtain a gambling license. In these circumstances,

online gambling operators may justify their remote supply of gambling services for a number of reasons, including a “country

of origin” basis which asserts that it is lawful to supply online gambling services remotely from a jurisdiction in which a

gambling license is held in another jurisdiction, unless there is something within the laws of that second jurisdiction that

explicitly outlaws such provision and explicitly applies to such inward supply emanating from outside its borders.

There is a risk that such jurisdictions may enact regulations relating to online real money gaming and that we may be required

to register our activities or obtain licenses (or obtain further registrations or licenses, as applicable), pay taxes, royalties or fees

or that the operation of online gambling businesses in such jurisdictions may be prohibited entirely. The implementation of

additional licensing or regulatory requirements, prohibitions or payments in such jurisdictions could have an adverse effect on

the viability of our revenue, operations, business or financial performance. Where we or our partners fail to obtain the necessary

registrations or licenses, make the necessary payments or operate in a jurisdiction where online gambling is deemed to be or

becomes prohibited, we or our partners may be subject to investigation, penalties or sanctions or forced to discontinue

operations entirely in relation to that jurisdiction. Any such actions may also have an adverse impact on the way our regulators

regulate us in the jurisdictions in which we hold licenses.

Certain of our technology providers, payment processing partners or other suppliers of content or services (collectively,

“Infrastructure Services”) may cease to provide, or limit the availability of, such Infrastructure Services to the extent we derive

revenue from, or makes such Infrastructure Services available to customers in, unregulated jurisdictions. There is no assurance

that we would be able to identify suitable or economical replacements if such Infrastructure Services become unavailable.

There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or public

entities, incumbent monopoly providers or private individuals, could be initiated against us or providers of our Infrastructure

Services in unregulated jurisdictions. Such potential proceedings could assert that online gambling services have not been

lawfully supplied into the domestic market and could involve substantial litigation expense, penalties, fines, seizure of assets,

injunctions or other restrictions being imposed on us or our business partners and may divert the attention of our key

executives. If we become subject to any such investigations, proceedings and/or penalties in one jurisdiction, this may lead to

investigations, proceedings and/or penalties arising in other jurisdictions in which we operate and/or hold a license. Such

investigations, proceedings and/or penalties could have a material adverse effect on our business, financial condition and results

of operations, as well as our reputation.

We are exposed to exchange rate risks.

Foreign exchange risk arises when individual group entities enter into transactions denominated in a currency other than their

functional currency. Our policy is, where possible, to allow our entities to settle liabilities denominated in their functional

currency with the cash generated from their own operations in that currency. Where our entities have liabilities denominated in

a currency other than their functional currency (and have insufficient reserves of that currency to settle them), cash already

denominated in that currency will, where possible, be transferred from elsewhere within Bally’s. Apart from these particular

cash flows, we aim to fund expenses and investments in the respective currency and to manage foreign exchange risk at a local

level by matching the currency in which revenue is generated and expenses are incurred, as well as by matching the currency of

our debt structure with the currency that cash is generated in. However, no assurance can be given that these policies will

deliver all, or substantially all, of the expected benefits.

A vast majority of the revenues currently generated by Gamesys, our wholly owned subsidiary, are from the UK and are

conducted in British Pound Sterling (“GBP”) and are therefore susceptible to any movements in exchange rates between GBP

and US Dollars (“USD”). Any exchange rate risk may materially adversely affect our business, financial condition and results

of operations.

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Our substantial activities in foreign jurisdictions may be affected by factors outside of our control.

A portion of our operations are conducted in non-US jurisdictions. As such, our operations may be adversely affected by

changes in foreign government policies and legislation (including gambling legislation) or social instability and other factors

that are not within our control, including renegotiation or nullification of existing contracts or licenses, changes in gambling

policies, regulatory requirements or the personnel administering them, currency fluctuations and devaluations, exchange

controls, economic sanctions, tax increases, retroactive tax claims, changes in taxation policies, risk of terrorist activities,

revolution, border disputes, implementation of tariffs and other trade barriers and protectionist practices, volatility of financial

markets and fluctuations in foreign exchange rates, difficulties in the protection of intellectual property, labor disputes and other

risks arising out of foreign governmental sovereignty over the areas in which operations are conducted. Our operations may

also be adversely affected by laws and policies of such foreign jurisdictions affecting foreign trade, taxation and investment.

Accordingly, our activities in foreign jurisdictions could be substantially affected by factors beyond our control, any of which

could have a material adverse effect on our business, financial condition and results of operations.

In the event of a dispute arising in connection with operations in a foreign jurisdiction where we conduct business, we may be

subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdictions

of the courts of the US or enforcing US judgments in such other jurisdictions. We may also be hindered or prevented from

enforcing their rights with respect to a governmental instrumentality because of the doctrine of sovereign immunity.

We may also enter into agreements and conduct activities outside of the jurisdictions in which we currently carry on business,

which expansion may present challenges and risks as a result of the factors described above that we have not faced in the past,

any of which could have a material adverse effect on our business, financial condition and results of operations.

Our activities are affected by the General Data Protection Regulation, as implemented in each of the UK and the EU

(collectively, “GDPR”).

We are required to comply with the GDPR to the extent that we either: (1) have customers located in the UK and the EU or (2)

conduct the processing of personal data in the UK and the EU. The impact of GDPR is particularly relevant to our customer

data, marketing activities, information security systems, and associated procedures. The GDPR and associated e-privacy laws

impose constraints on the ability of a data controller to profile and market to customers. Data subjects have the right to object to

a controller processing their data in certain circumstances, including the right to object to their data being processed for the

purposes of direct marketing. Controllers of personal data are required to maintain written records as to how they comply with

GDPR and provide more detailed information to data subjects in relation to how their data is being processed. In addition,

updated e-privacy laws are under consideration in the EU to update the legislative rules applicable to digital and online data

processing and to align e-privacy laws to GDPR. The GBGC has separately introduced limitations on the use of personal data

by holders of operating licenses, particularly in relation to direct marketing.

The GDPR also increased the level of fines which may be imposed for a breach of data protection laws, with the maximum fine

(in the most serious cases of a breach of GDPR) being the higher of €20 million (£17.5 million for the UK) or four percent of

annual worldwide turnover. In certain instances, we could be held responsible for breaches committed by the third-party service

providers which we use or by other third parties with whom we share personal data.

Many of the obligations imposed on controllers by GDPR are expressed as high-level principles, such as the obligation to act

fairly with respect to the processing of personal data. The manner in which the data regulators and courts will interpret and

apply GDPR is and will continue to evolve over time. In addition, as a result of Brexit, the application of GDPR in the UK and

the EU will increasingly diverge, posing even greater compliance challenges for businesses operating in these jurisdictions.

These procedures and policies continually affect our business by constraining our data processing activities and increasing our

operational and compliance costs. Additional updates to these policies and procedures and associated operational changes may

be required and costs incurred to comply with updates to e-privacy laws.

If our or any third-party service providers’ data processing activities breach GDPR (or associated e-privacy laws), then we

could, whether as a result of a failure to implement adequate policies and procedures or otherwise, face significant fines and/or

the revocation of existing licenses and/or the refusal of new applications for licenses, as well customer claims. class actions and

reputational damage. The resultant losses suffered could materially adversely affect our business, financial condition and results

of operations. There can be no assurances that we would be able to recoup such losses, whether in whole or in part, from our

third-party service providers or insurers.

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Business Operational Risks

We will be reliant on effective payment processing services from a limited number of providers in each of the markets in

which we operate.

The provision of convenient, trusted, fast and effective payment processing services to our customers and potential customers is

critical to our business. If there is any deterioration in the quality of the payment processing services provided to these

customers or any interruption to those services (including with respect to system intrusions, unauthorized access or

manipulation), or if such services are only available at an increased cost to us or our customers or are terminated and no timely

and comparable replacement services are found, our customers and potential customers may be deterred from using our

products. In addition, our inability to secure payment processing services in markets into which we intend to expand may

seriously impair our growth opportunities and strategies. Any of these occurrences may have a material adverse effect on our

business, financial condition and results of operations.

Furthermore, a limited number of banks and credit card companies process online gambling related payments as a matter of

internal policy and any capacity to accept such payments may be limited by the regulatory regime of a given jurisdiction. The

introduction of legislation or regulations restricting financial transactions with online gambling operators, other prohibitions or

restrictions on the use of credit cards and other banking instruments for online gambling transactions may restrict our ability to

accept payments from our customers. These restrictions may be imposed as a result of concerns related to fraud, payment

processing, AML or other issues related to the provision of online gambling services. A number of issuing banks or credit card

companies may from time to time reject payments to us that are attempted to be made by our customers. Should such

restrictions and rejections become more prevalent, or any other restriction on payment processing be introduced, gambling

activity by our customers could be adversely affected, which in turn could have a material adverse effect on our business,

financial condition and results of operations.

In addition, we are subject to the risk of credit card chargebacks, which may also result in possible penalties. A chargeback is a

credit card originated deposit transaction to a player account with an operator that is later reversed or repudiated. The risk of

such chargeback transactions is greater in respect of certain markets and certain payment methods. We recognize revenue upon

the first loss of the player on amounts tendered, and any credit card chargebacks are then deducted from their revenues. Even

though security measures are in place, high rates of credit card chargebacks could result in credit card associations levying

additional costs and fines or withdrawing their service and could have a material adverse effect on our business, financial

condition and results of operations.

Our VLTs and table games hold percentages may fluctuate.

The gaming industry is characterized by an element of chance and our casino guests’ winnings depend on a variety of factors,

some of which are beyond our control. In addition to the element of chance, hold percentages (the ratio of net win to total

amount wagered) are affected by other factors, including players’ skill and experience, the mix of games played, the financial

resources of players, the volume of bets placed and the amount of time played. The variability of our hold percentages has the

potential to adversely affect our business, financial condition and results of operations.

Our profitability will be dependent, in part, on return to players.

The revenue from certain of our gaming products depends on the outcome of random number generators built into the gaming

software running the games made available to customers. Return to player is measured by dividing the amount of real money

won by players on a particular game by the total real money wagers over a particular period on that game. An increasing return

to player may negatively affect revenue as it represents a larger amount of money being won by players. Return to player is

driven by the overall random number generator outcome, the mechanics of different games and jackpot winnings. Each game

utilizes a random number generating engine; however, generally the return to player fluctuates in the short-term based on large

wins or jackpots or a large share of wagers made for higher-payout games. To the extent we are unable to set, or fail to obtain, a

favorable return to player in our (or a third-party supplier’s) gambling software which maximizes revenue, it could have a

material adverse effect on our business, financial condition and results of operations.

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The success, including win or hold rates, of existing or future sports betting and iGaming products depends on a variety of

factors and is not completely controlled by us.

The sports betting and iGaming industries are characterized by an element of chance. Accordingly, we employ theoretical win

rates to estimate what a certain type of sports bet or iGame, on average, will win or lose in the long run. Net win is impacted by

variations in the hold percentages, or actual outcomes, on our iGames and sports betting we offer to our users. We use the hold

percentages as an indicator of an iGame’s or sports bet’s performance against its expected outcome. Although each iGame or

sports bet generally performs within a defined statistical range of outcomes, actual outcomes may vary for any given period. In

addition to the element of chance, win rates (hold percentages) may also (depending on the game involved) be affected by the

spread of limits and factors that are beyond our control, such as a user’s skill, experience and behavior, the mix of games

played, the financial resources of users, the volume of bets placed and the amount of time spent gambling. As a result of the

variability in these factors, the actual win rates on our online iGames and sports bets may differ from the theoretical win rates

we have estimated and could result in the winnings of our iGame’s or sports bet’s users exceeding those anticipated. The

variability of win rates (hold rates) also have the potential to negatively impact our financial condition, results of operations and

cash flows.

Our success also depends in part on our ability to anticipate and satisfy user preferences in a timely manner. As we will operate

in a dynamic environment characterized by rapidly changing industry and legal standards, our products will be subject to

changing consumer preferences that cannot be predicted with certainty. We will need to continually introduce new offerings

and identify future product offerings that complement our existing platforms, respond to our users’ needs and improve and

enhance our existing platforms to maintain or increase our user engagement and growth of our business. We may not be able to

compete effectively unless our product selection keeps up with trends in the digital sports entertainment and gaming industries

in which we compete, or trends in new gaming products.

We extend credit to a portion of our customers, and we may not be able to collect gaming receivables from our credit

customers.

We conduct our gaming activities on a credit and cash basis at many of our properties. Any such credit we extend is unsecured.

Table game players typically are extended more credit than slot players, and high-stakes players typically are extended more

credit than customers who tend to wager lower amounts. High-end gaming is more volatile than other forms of gaming, and

variances in win-loss results attributable to high-end gaming may have a significant positive or negative impact on cash flow

and earnings in a particular period. We extend credit to those customers whose level of play and financial resources warrant, in

the opinion of management, an extension of credit. These large receivables could have a significant impact on our results of

operations if deemed uncollectible. Gaming debts evidenced by a credit instrument, including what is commonly referred to as a

“marker,” and judgments on gaming debts are enforceable under the current laws of the jurisdictions in which we allow play on

a credit basis, and judgments on gaming debts in such jurisdictions are enforceable in all US states under the Full Faith and

Credit Clause of the US Constitution; however, other jurisdictions may determine that enforcement of gaming debts is against

public policy. Although courts of some foreign nations will enforce gaming debts directly and the assets in the US of foreign

debtors may be reached to satisfy a judgment, judgments on gaming debts from US courts are not binding on the courts of many

foreign nations.

Declining popularity of games and changes in device preferences of players could have a negative effect on our business.

Revenue from online games tends to decline over time after reaching a peak of popularity and player usage. The speed of this

decline is referred to as the decay rate of a game. As a result of this natural decline in the life cycle of our products, our business

depends on our ability and the ability of our third-party partners to consistently and timely launch new games across multiple

platforms and devices that achieve significant popularity. Our ability to successfully launch, sustain and expand games as

applicable, largely will depend on our ability to, amongst other things: (1) anticipate and effectively respond to changing game

player interests and preferences; (2) anticipate or respond to changes in the competitive landscape; (3) develop, sustain and

expand games that are fun, interesting and compelling to play; (4) minimize launch delays and cost overruns on new games; (5)

minimize downtime and other technical difficulties; (6) acquire leading technology and high quality personnel; and (7) comply

with constraints on game design and/or functionality imposed by regulators. There is a risk that we may not launch any new

games according to schedule, or that those games do not attract and retain a significant number of players, which could have a

negative effect on our business, financial condition and results of operations.

Furthermore, more individuals are using non-PC/laptop devices to access the internet and versions of our technology developed

for these devices may not be widely adopted by users of such devices. If we are unable to attract and retain a substantial number

of alternative device users to our gambling services or if we are slow to develop products and technologies that are more

compatible with non-PC/laptop communications devices relative to our competitors, we may fail to capture a significant share

of an increasingly important portion of the market for online gambling services.

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In addition to offering popular new games, we must extend the life of the existing games which we make available to users, in

particular the most successful games. While it is difficult to predict when revenues from any such existing games will begin to

decline, for a game to remain popular, we must constantly enhance, expand or upgrade the relevant game with new features that

players find attractive. There is a risk that we may not be successful in enhancing, expanding or upgrading our current games or

any new games in the future and, in addition, regulators may introduce new rules that limit functionality within existing games.

Should we not succeed in sufficiently offsetting the effects of declining popularity in the games we make available, this may

have a material adverse effect on our business, financial condition and results of operations.

The casino, hotel and hospitality industry is capital intensive and we may not be able to finance development, expansion and

renovation projects, which could put us at a competitive disadvantage.

Our casino and hotel properties have an ongoing need for renovations and other capital improvements to remain competitive,

including room refurbishments, amenity upgrades and replacement, from time to time, of furniture, fixtures and equipment. We

may also need to make capital expenditures to comply with applicable laws and regulations. Construction projects, such as our

construction of the permanent casino in Chicago, entail significant risks, which can substantially increase costs or delay

completion of a project. Such risks include shortages of materials or skilled labor, unforeseen engineering, environmental or

geological problems, work stoppages, weather interference and unanticipated cost increases. Most of these factors are beyond

our control. In addition, difficulties or delays in obtaining any of the requisite licenses, permits or authorizations from

regulatory authorities can increase the cost or delay the completion of an expansion or development. Significant budget

overruns or delays with respect to expansion and development projects could adversely affect our business and results of

operations.

Renovations and other capital improvements of casino properties in particular require significant capital expenditures. In

addition, any such renovations and capital improvements usually generate little or no cash flow until the projects are completed.

We may not be able to fund such projects solely from cash provided from operating activities. Consequently, we may have to

rely upon the availability of debt or equity capital to fund renovations and capital improvements, and our ability to carry them

out will be limited if we cannot obtain satisfactory debt or equity financing, which will depend on, among other things, market

conditions. We cannot assure you that we will be able to obtain additional equity or debt financing on favorable terms or at all.

Our failure to renovate and maintain gaming and entertainment venues from time to time may put us at a competitive

disadvantage to gaming and entertainment venues offering more modern and better maintained facilities, which could adversely

affect our business, financial condition and results of operations.

We are subject to various construction and development risks in connection with our current and future construction

projects.

Our business is subject to various construction and development risks in connection with construction projects, such as our

construction of the permanent casino in Chicago, the planned development at the former Tropicana Las Vegas and our planned

Bally’s Bronx project. Construction and development projects are often developed in multiple stages involving commercial and

governmental negotiations, site planning, due diligence, permit requests, environmental impact studies, permit applications and

review, marine logistics planning and transportation and end-user delivery logistics, each of which requires significant effort

and dedication to complete. Projects of this type are subject to a number of risks, including, among others:

•engineering, environmental or geological problems;

•shortages or delays in the delivery of equipment and supplies;

•government or regulatory approvals, permits or other authorizations;

•failure to meet technical specifications or adjustments being required based on testing or commissioning;

•construction accidents that could result in personal injury or loss of life;

•lack of adequate and qualified personnel to execute our current and future construction projects;

•weather interference;

•delays in removing current tenants from the proposed sites; and

•potential labor shortages, work stoppages or labor union disputes.

Furthermore, because of the nature of our business, we are dependent on numerous third parties, including local, state and

federal governmental entities that are required to certificate and license our facilities. Delays from such third parties or

governmental entities could prevent us from successfully executing our current and future construction projects. In addition, as

a builder of gaming facilities, we expect to face an intense regulatory process and heightened political pressure to finalize our

construction projects in a timely manner, which subjects us to risks associated with changes in the political views and structure,

government representatives, new regulations, regulatory reviews, employment laws and diligence requirements. Each of these

could make it more difficult, time-consuming and expensive to develop our current and future construction projects.

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The occurrence of any one of these factors, whatever the cause, could result in unforeseen delays or cost overruns. Delays in the

development beyond our estimated timelines, or amendments or change orders to our construction contracts, could result in

increases to our development costs beyond our original estimates, which could require us to obtain additional financing or

funding and could make our current and future construction projects less profitable than originally estimated or possibly not

profitable at all. Further, any such delays could cause a delay in the receipt of any anticipated revenues. We have experienced

time delays and cost overruns in the construction and development of construction projects in the past as a result of the

occurrence of various of the above factors, and no assurance can be given that we will not experience in the future similar

events, any of which could have a material adverse effect on our business, operating results, cash flows and liquidity.

We may invest in or acquire other businesses, and our business may suffer if we are unable to successfully integrate

acquired businesses into our company or otherwise manage the growth associated with multiple acquisitions.

Our completed or any future acquisitions, may not enhance our financial performance. Our ability to achieve the expected

benefits of any acquisitions will depend on, among other things, our ability to effectively translate our strategies into revenue,

our ability to retain and assimilate the acquired businesses’ employees, our ability to retain existing customers and suppliers on

terms similar to, or better than, those in place with the acquired businesses, our ability to attract new customers, the adequacy of

our implementation plans, our ability to maintain our financial and internal controls and systems as we expand our operations,

the ability of our management to oversee and operate effectively the combined operations and our ability to achieve desired

operating efficiencies and revenue goals. The integration of the businesses that we acquire might also cause us to incur costs

that are unforeseen or that exceed our estimates, which would lower our future earnings and would prevent us from realizing

the expected benefits of such acquisitions. In some cases, the services provided by the sellers are critical to the ongoing efficient

operation of the properties and may involve costly payments from us to the provider of the services. If the provision of these

services by the sellers is disrupted or given insufficient attention by the sellers, our ability to operate the properties may be

negatively impacted until such time as we are able to take full control over the services. Moreover, we must pay the sellers for

these services and the costs to us for these services may exceed our estimates and these expenses will negatively impact the

results of operations of these properties during these transition periods. Failure to achieve the anticipated benefits of these

acquisitions could result in decreases in the amount of expected revenues and diversion of management’s time and energy and

could adversely affect our business, financial condition and operating results including, ultimately, a reduction in our stock

price.

We face risks associated with growth and acquisitions.

As part of our business strategy, we regularly evaluate opportunities for growth through development of gaming operations in

existing or new markets, through acquiring other gaming entertainment facilities or through redeveloping our existing gaming

facilities. In the future, we may also pursue expansion opportunities, including joint ventures or partnerships, in jurisdictions

where casino gaming is not currently permitted in order to be prepared to develop projects upon approval of casino gaming.

Although we only intend to engage in acquisitions that, if consummated, will be accretive to us and our shareholders,

acquisitions require significant management attention and resources to integrate new properties, businesses and operations. Our

ability to realize the anticipated benefits of acquisitions will depend, in part, on our ability to integrate the acquired businesses

with our businesses. The combination of two independent companies is a complex, costly and time-consuming process. This

process may disrupt the business of either or both of the companies and may not result in the full benefits expected. Potential

difficulties we may encounter as part of the integration process that may negatively impact our earnings or otherwise adversely

affect our business and financial results include, among other things, the following:

•the inability to successfully incorporate acquired assets in a manner that permits us to achieve the full revenue

increases, cost reductions and other benefits anticipated to result from any acquisitions;

•complexities associated with managing the combined business, including difficulty addressing possible differences in

cultures and management philosophies and the challenge of integrating complex systems, technology, networks and

other assets of each of the companies in a seamless manner that minimizes any adverse impact on customers, suppliers,

employees and other constituencies;

•the disruption of, or the loss of momentum in, each of our ongoing businesses;

•inconsistencies in standards, controls, procedures and policies; and

•potential unknown liabilities and unforeseen increased expenses associated with acquisitions.

Additionally, even if integration is successful, the overall integration of acquired assets and businesses may result in material

unanticipated problems, expenses, liabilities, competitive responses, loss of customer and other business relationships and

diversion of management attention. There is also no guarantee that the acquired assets or businesses will generate any of the

projected synergies and earnings growth, and the failure to realize such projected synergies and earnings growth may adversely

affect our operating and financial results and derail any growth plans.

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There can be no assurance that we will be able to identify, acquire, develop or profitably manage additional companies or

operations or successfully integrate such companies or operations into our existing operations without substantial costs, delays

or other problems. Additionally, there can be no assurance that we will receive gaming or other necessary licenses or approvals

for new projects that we may pursue or that gaming will be approved in jurisdictions where it is not currently approved.

Ballot measures or other voter-approved initiatives to allow gaming in jurisdictions where gaming, or certain types of gaming

(such as slots and sports wagering), was not previously permitted could be challenged, and, if such challenges are successful,

these ballot measures or initiatives could be invalidated. Furthermore, there can be no assurance that there will not be similar or

other challenges to legalized gaming in existing or current markets in which we may operate or have development plans, and

successful challenges to legalized gaming could require us to abandon or substantially curtail our operations or development

plans in those locations, which could have a material adverse effect on our financial condition and results of operations.

There can be no assurance that we will not face similar challenges and difficulties with respect to new development projects,

such as the permanent casino project in Chicago, or expansion efforts that we may undertake, which could result in significant

sunk costs that we may not be able to fully recoup or that otherwise have a material adverse effect on our financial condition

and results of operations. We may not be able to obtain additional financing on acceptable terms or at all. To the extent that we

seek to acquire other businesses in exchange for our common stock, fluctuations in our stock price could adversely affect our

ability to complete acquisitions.

We may not realize the anticipated benefits of existing or pending strategic alliances, joint ventures, acquisitions, divestitures or

new business strategies.

We have invested in, formed strategic alliances with and announced proposed joint ventures with other companies, such as the

RI Joint Venture, and we may expand those relationships or enter into similar relationships with additional companies which

may require various state approvals which may or may not be granted. These initiatives are typically complex, and we may not

be able to complete anticipated alliance or joint venture transactions, the anticipated benefits of these transactions may not be

realized or the benefits may be delayed. For example, we may not successfully integrate an alliance or joint venture with our

operations, including the implementation of our controls, systems, procedures and policies, or unforeseen expenses or liabilities

may arise that were not discovered during due diligence prior to an investment or entry into a strategic alliance, or a

misalignment of interests may develop between us and the other party. Further, to the extent we share ownership, control or

management with another party in a joint venture, our ability to influence such joint venture may be limited, and we may be

unable to prevent misconduct or implement our compliance or internal control systems. In addition, implementation of a new

business strategy may lead to the disruption of our existing business operations, including distracting management from current

operations. Results of operations from new activities may be lower than our existing activities, and, if a strategy is unsuccessful,

we may not recoup our investments in that strategy. Failure to successfully and timely realize the anticipated benefits of these

transactions or strategies could have an adverse effect on our financial condition or results of operations.

Following the combination of the international interactive business within Bally’s Intralot, there can be no assurance that

Bally’s Intralot will be able to successfully integrate the combined lottery B2B and online gaming B2C businesses.

The integration of the two companies may result in material challenges, including the diversion of management’s attention from

ongoing business concerns; retaining key management and other employees; retaining or attracting business and operational

relationships; faulty assumptions underlying expectations regarding the integration process and associated expenses;

consolidating corporate and administrative infrastructures and eliminating duplicative operations; coordinating geographically

separate organizations; unanticipated issues in integrating information technology, communications and other systems; as well

as potential unknown liabilities, unforeseen expenses relating to integration, or delays associated with the merger transactions.

Accordingly, the future operating results, cash flows and financial condition of the combined company will be affected by its

ability to manage changing business conditions and to implement and adapt its financial controls and reporting systems in

response to the merger transactions.

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Our business depends, in part, on strategic relationships with third parties. Overreliance on certain third parties or our

inability to extend existing relationships or agree to new relationships may cause unanticipated costs for us and impact our

financial performance in the future.

We have entered into strategic partnerships with the National Hockey League, MLB Professional Development Leagues, LLC,

among others, and may enter into relationships with advertisers, casinos and other third parties in order to attract users to our

platform. These relationships along with providers of online services, search engines, social media, directories and other

websites and e-commerce businesses direct consumers to our platform. In addition, parties with whom we have advertising

arrangements provide advertising services to other companies, including other fantasy sports and gaming platforms with which

we compete. While we believe there are other third parties that could drive users to our platform, adding or transitioning to

them may disrupt our business and increase our costs. In the event that any of our existing relationships or our future

relationships fails to provide services to us in accordance with the terms of our arrangement, or at all, and we are not able to

find suitable alternatives, this could impact our ability to attract consumers cost effectively and harm our business, financial

condition and results of operations.

Our branded sites are heavily reliant on well-known brands owned by third parties.

We operate certain branded sites, including sites branded as Virgin Games, Double Bubble Bingo and Monopoly Casino. All

such branded sites operated by us are reliant on the use of highly trusted and recognizable brands which are owned by third

parties (the “Third Party Brands”). We operate the Third Party Brands pursuant to brand licensing arrangements with the

relevant third party brand owner (the “Brand Owner”). We are contractually required to operate such branded sites in

accordance with those brand licensing arrangements, and any material breach of those requirements may expose us to claims for

breach of contract and/or may lead to the Brand Owner terminating or failing to renew the brand licensing arrangements. We

own the player data in respect of such branded sites, and in the event that the brand licensing arrangements for any of such

branded sites were to be terminated early or not renewed, then we would seek to migrate those players to a different gaming site

operated by us. However, there is a risk that any replacement branded site offered by us may not successfully retain those

players, and if we lose the right to use any of the Third Party Brands, our business, financial condition and results of operations

may be materially adversely affected.

We are exposed to the risk that the reputation of the Third Party Brands may be adversely affected by the activities of third

parties over whom we have no control. For example, we operate the Virgin Games site. The Virgin brand is used by a wide

range of businesses. In the event that the reputation of the Virgin brand was to be adversely affected due to the actions of third

parties, that may affect our business prospects.

Our online business model depends upon the continued compatibility between our apps and the major mobile operating

systems and upon third-party platforms for the distribution of our product offerings, which depend on factors beyond our

control such as the design of third-party operating systems and continued access to our apps on third-party distribution

platforms like the Apple App Store.

Our digital business is dependent on the interoperability of our technology with popular mobile operating systems,

technologies, networks and standards as our users access our online betting and gaming product offerings primarily on mobile

devices. As a result, our business model depends upon the continued compatibility between our app and the major mobile

operating systems, such as the Android and iOS operating systems, and we rely upon third-party platforms for distribution of

our product offerings. We do not have formal or informal relationships with parties that control design of mobile devices and

operating systems and there is no guarantee that popular mobile devices will start or continue to support or feature our product

offerings. Any changes, bugs, technical or regulatory issues in such operating systems, our relationships with mobile

manufacturers and carriers, or in their terms of service or policies that degrade our offerings’ functionality, reduce or eliminate

our ability to distribute our offerings, give preferential treatment to competitive products, limit our ability to deliver high quality

offerings, or impose fees or other charges related to delivering our offerings, could adversely affect our product usage and

monetization on mobile devices. In addition, if any of the third-party platforms used for distribution of our product offerings

were to limit or disable the availability of our app or advertising on their platforms, our ability to generate revenue could be

harmed. These changes could materially impact the way we do business, and if we are unable to adjust to those changes quickly

and effectively, there could be an adverse effect on our business, financial condition, results of operations and prospects.

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A portion of our casinos are located on leased property. If we default on one or more leases, the applicable lessors could

terminate the affected leases and we could lose possession of the affected casino.

We currently lease certain real property interests underlying several of our Casino properties. Our leases provide that they may

be terminated for a number of reasons, including failure to pay rent, taxes or other payment obligations or the breach of other

covenants contained in the leases. Our leases with GLPI, excluding the Chicago MLA, require annual rent payments of

$233.1 million in 2026, which is subject to escalation annually, and in some instances, obligate us to make specified minimum

capital expenditures with respect to the leased properties. If our business and properties fail to generate sufficient earnings, the

payments required to service the rent obligations under our leases with GLPI could materially and adversely limit our ability to

react to changes in our business and make acquisitions and investments in our properties. Regarding our ground leases, we have

the right to use the leased land; however, we do not hold fee ownership of the underlying land. Accordingly, we have no

interest in the leased land or improvements thereon at the expiration of the ground leases. If our use of the land underlying our

casino properties is disrupted permanently or for a significant period of time, then the value of our assets could be impaired and

our business and operations could be adversely affected. If we were to default on any one or more of these leases, the applicable

lessors could terminate the affected leases and we could lose possession of the affected land and any improvements on the land,

including the hotels and casinos. Further, in the event that any lessor of our leased properties, including GLPI, encounters

financial, operational, regulatory or other challenges, there can be no assurance that such lessor will be able to comply with its

obligations under the applicable lease.

We entered into a lease with GLP and could experience risks associated with the leased property, including risks relating to

lease termination, inability to obtain a satisfactory lease extension, consents and approvals, charges and our relationship

with the landlord, which could have a material adverse effect on our business, financial position or results of operations.

On July 17, 2025, Bally’s Chicago Operating Company, LLC (“Bally’s Chicago OpCo”), an affiliate of the Company, entered

into (a) an amended and restated ground lease (the “Chicago MLA”) with GLP Capital, L.P. (“GLP”) pursuant to which Bally’s

Chicago OpCo leases the property on which it is developing our permanent Chicago resort and casino and (b) a development

agreement with GLP (the “GLP Development Agreement”) pursuant to which GLP has committed to advance up to $940

million (the “GLP Development Advances”) for the payment of hard costs used to construct our permanent Chicago resort and

casino in exchange for increasing the amount of rent that Bally’s Chicago OpCo pays to GLP under the Chicago MLA. The

Chicago MLA has a 15-year term and up to four renewal terms of five years each, if elected by Bally’s Chicago OpCo, and rent

payable under the Chicago MLA is (a) $20.0 million annually, subject to annual escalations set forth therein, plus (b) an annual

amount equal to 8.5% of the GLP Development Advances that GLP advances to Bally’s Chicago OpCo.

GLP has the right to terminate the Chicago MLA upon any event of default under the Chicago MLA. Such events of default

include, without limitation, a failure to pay amounts due after applicable notice and cure periods, certain bankruptcy or

insolvency events, a cross-default with the GLP Development Agreement and the failure to comply with a variety of covenants

after applicable notice and cure periods, including those related to the development of our permanent resort and casino, repair

and maintenance, alterations and insurance. In addition, from and after any refinancing, extension or majority amendment of

our Credit Agreement, the Chicago MLA will include a cross-default to (a) that certain Master Lease, dated June 3, 2021, as

subsequently amended, between GLP and Bally’s Management Group, LLC (“Bally’s Management”), an affiliate of the

Company, pursuant to which Bally’s Management leases the following properties from GLP: Bally’s Evansville, Bally’s Dover,

Bally’s Black Hawk North, Bally’s Black Hawk West, Bally’s Black Hawk East, Bally’s Quad Cities, Bally’s Tiverton and

Hard Rock Biloxi and (b) that certain Master Lease, dated December 16, 2024, as subsequently amended, between GLP and

Bally’s Management, pursuant to which Bally’s Management leases the following properties from GLP: Bally’s Kansas City,

Bally’s Shreveport, Bally’s Twin River, DraftKings at Casino Queen and The Queen Baton Rouge.

There are also certain restrictions on Bally’s Chicago OpCo’s ability to assign its interest in the Chicago MLA without having

to obtain GLP’s prior consent, including requirements for the transferee (or its parent company) to satisfy certain financial

metrics and have a certain level of experience in operating or managing casinos.

GLP’s obligation to make GLP Development Advances under the GLP Development Agreement is subject to certain

conditions, including that Bally’s Chicago OpCo shall have unrestricted access to funds in an amount sufficient at the time of

each GLP Development Advance to fund the construction of our permanent resort and casino. Bally’s Chicago OpCo is

obligated to construct our permanent resort and casino in compliance with terms and conditions set forth in the GLP

Development Agreement, which include the satisfaction of specified development and construction milestones.

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The GLP Development Agreement contains customary representations and covenants by Bally’s Chicago OpCo and contains

funding conditions, including, without limitation, (a) GLP’s reasonable approval of plans and specifications, the project budget

(including amendments thereto and reallocations therein except those permitted under the GLP Development Agreement), the

project schedule, the underlying construction and architect contracts, and all change orders (subject to exceptions set forth in the

GLP Development Agreement), (b) GLP’s receipt of appropriate lien waivers, (c) budget balancing requirements, (d) retainage

requirements, and (e) other customary conditions, all as set forth in the GLP Development Agreement. From and after the first

GLP Development Advance, Bally’s Chicago OpCo is required to fund all hard costs of construction of the permanent resort

and casino utilizing solely GLP Development Advances until GLP has funded its entire commitment or construction has been

completed. The GLP Development Agreement also contains defaults and remedies, including, without limitation, a cross-

default with the Chicago MLA. Bally’s Chicago OpCo is not permitted to assign, finance, transfer, pledge or encumber its

interest in the GLP Development Agreement without GLP’s prior written consent, whether or not any such assignment,

financing, transfer, pledge or encumbrance is permitted with respect to the GLP Lease Agreement, other than to a permitted

leasehold mortgagee under the Chicago MLA.

Termination of any or all of the casino lease agreements (including as a result of a default under the GLP Development

Agreement) would result in us losing some or all of our rights with respect to the applicable properties, could result in a default

under the Host Community Agreement, and could have a material adverse effect on our business, financial position or results of

operations. In the event of a termination of any of the casino lease agreements (including as a result of a default under the GLP

Development Agreement), we may be required to transfer all personal property located at the applicable property to a

designated successor, and we may not be adequately compensated for that personal property. Moreover, since as a lessee we do

not completely control the land and improvements underlying our operations, the lessors could take certain actions to disrupt

our rights in the properties leased under the casino lease agreements, which are beyond our control. If the lessors chose to

disrupt our use either permanently or for a significant period of time, then the value of our assets could be impaired and our

business and operations could be adversely affected. There can also be no assurance that we will be able to comply with our

obligations under the casino lease agreements (including our obligations under the GLP Development Agreement) in the future.

In addition, if the lessors have financial, operational, regulatory or other challenges, there can be no assurance that the lessors

will be able to comply with their obligations under the casino lease agreements, including their obligations to provide us

financing for the construction of our permanent resort and casino in Chicago.

We rely on other third-party sports data providers for real-time and accurate data for sporting events, and if such third

parties do not perform adequately or terminate their relationships with us, our costs may increase and our business,

financial condition and results of operations could be adversely affected.

We rely on third-party sports data providers to obtain accurate information regarding schedules, results, performance and

outcomes of sporting events. We rely on this data to determine when and how sports bets are settled. We have experienced, and

may continue to experience, errors in this data feed which may result in us incorrectly settling bets. If we cannot adequately

resolve the issue with our users, our users may have a negative experience with our offerings, our brand or reputation may be

negatively affected and our users may be less inclined to continue or resume utilizing our products or recommend our offerings

to other potential users. As such, a failure or significant interruption in our service may harm our reputation, business and

operating results.

Furthermore, if any of our sports data partners terminates its relationship with us or refuses to renew its agreement with us on

commercially reasonable terms, we would need to find an alternate provider, and may not be able to secure similar terms or

replace such providers in an acceptable time frame. Any of these risks could increase our costs and adversely affect our

business, financial condition and results of operations. Further, any negative publicity related to any of our third-party partners,

including any publicity related to regulatory concerns, could adversely affect our reputation and brand, and could potentially

lead to increased regulatory or litigation exposure.

32

Negative perceptions and publicity surrounding the lottery industry could lead to increased regulation.

Our Bally’s Intralot business includes a global lottery management and services business. The popularity and acceptance of

lottery games is influenced by prevailing social attitudes toward the lottery, and changes in social attitudes toward the lottery

could result in reduced acceptance of lottery play as a leisure activity. Further, from time to time, the lottery industry is exposed

to negative publicity related to player behavior, play by minors, the presence of point-of-sale machines in too many locations,

risks related to iLottery accessibility, and alleged association with money laundering. Publicity regarding problem gambling and

other concerns with the lottery industry, even if not directly connected to the Company, could adversely impact its business,

results of operations, and financial condition. For example, if the perception develops that the lottery industry is failing to

address responsible lottery concerns adequately, the resulting political pressure may result in the industry becoming subject to

increased regulation and restrictions on operations. Such an increase in regulation could adversely impact our results of

operations, business, financial condition, or prospects.

Our management identified a material weakness in our internal control over financial reporting which could, if not

remediated, result in material misstatements in our consolidated financial statements.

Our management is responsible for establishing and maintaining adequate internal controls over our financial reporting, as such

term is defined in Rule 13a-15(f) under the Exchange Act. As disclosed in this report, we evaluated the effectiveness of our

internal control over financial reporting and identified a material weakness as of December 31, 2025 relating to the ineffective

operation of management review controls over accounting for income taxes and related disclosures.

A material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting,

such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be

prevented or detected on a timely basis. If not remediated, the material weakness identified above could result in material

misstatements in our consolidated financial statements.

We conduct our business in an industry that is subject to high taxes and may be subject to higher taxes in the future.

In gaming jurisdictions in which we conduct our business, with the exception of Rhode Island, state and local governments

raise considerable revenues from taxes based on casino revenues and operations. In Rhode Island, the state takes all of the

gaming win that comes into our Rhode Island operations and then pays us a percentage of the gaming win. We also pay

property taxes, occupancy taxes, sales and use taxes, payroll taxes, franchise taxes and income taxes. Our profitability will

depend on generating enough revenues to cover variable expenses, such as payroll and marketing, as well as largely fixed

expenses, such as property taxes and interest expense. From time to time, state and local governments have increased gaming

taxes and such increases could significantly impact the profitability of our gaming operations.

Our operations in other states are generally subject to significant revenue-based taxes and fees in addition to normal federal,

state and local income taxes, and such taxes and fees are subject to increase at any time. In addition, from time to time, federal,

state and local legislators and officials have proposed changes in tax laws, or in the administration of such laws, affecting the

gaming industry. Further, worsening economic conditions could intensify the efforts of applicable state and local governments

to raise revenues through increases in gaming taxes and/or property taxes. It is not possible to determine with certainty the

likelihood of changes in tax laws in these jurisdictions or in the administration of such laws. Such changes, if adopted, could

adversely affect our business, financial condition and results of operations. The large number of state and local governments

with significant current or projected budget deficits makes it more likely that those governments that currently permit gaming

will seek to fund such deficits with new or increased gaming taxes and/or property taxes and worsening economic conditions

could intensify those efforts. Any material increase, or the adoption of additional taxes or fees, could adversely affect our future

financial results.

There can be no assurance that governments in jurisdictions in which we conduct our business, or the federal government, will

not enact legislation that increases gaming tax rates. General economic pressures have the potential to reduce revenues of state

governments from traditional tax sources, which may cause state legislatures or the federal government to be more inclined to

increase gaming tax rates. See “New legislation governing the online gaming industry may be introduced in the UK which

limits or restricts our operating model in that market.”

33

New and future changes to US and non-US tax laws could adversely affect our business.

The US Congress, the Organization for Economic Co-operation and Development (the “OECD”) and other government

agencies in jurisdictions where Bally’s and its affiliates do business have had an extended focus on issues related to the taxation

of multinational corporations. One example is in the area of “base erosion and profit shifting,” including the OECD’s “Pillar

Two” framework, which, among other changes, generally provide for an effective global minimum corporate tax rate of 15% on

profits generated by certain multinational companies. Although this initiative is subject to further developments in the countries

where Bally’s and its affiliates do business, it is already in force in various jurisdictions, including the UK and the EU. On

January 5, 2026, the OECD announced a “side-by-side” elective safe harbor that exempts U.S.-parented multinational entities

from certain provisions of Pillar Two for fiscal years beginning on or after January 1, 2026. We are continuing to evaluate the

Pillar Two framework and related legislation and the potential impact on our business. The adoption of the Pillar Two

framework by countries in which Bally’s and its affiliates do business could adversely affect Bally’s and its affiliates’ effective

tax rate and increase tax complexity and uncertainty. Furthermore, as a result of the Pillar Two framework or other tax

initiatives, the tax laws in the US, the UK and other countries in which Bally’s and its affiliates do business could change on a

prospective or retroactive basis, and any such changes could adversely affect Bally’s and its affiliates.

In addition, the US government may enact significant changes to the taxation of business entities including, among others,

changes to the rules regarding controlled foreign corporations, the elimination of certain tax exemptions and the imposition of

further minimum taxes or surtaxes on certain types of income. Although a range of US tax legislation has been proposed, the

likelihood of these changes being enacted or implemented is unclear. We are currently unable to predict whether such changes

will occur and, if so, the ultimate impact on our business.

See “New legislation governing the online gaming industry may be introduced in the UK which limits or restricts our

operating model in that market.”

If we fail to detect fraud, theft or cheating, including by our customers and employees, our reputation may suffer which

could harm our brand and reputation and negatively impact our business, financial condition and results of operations and

can subject us to investigations and litigation.

We have in the past incurred, and may in the future incur, losses from various types of financial fraud, including use of stolen or

fraudulent credit card data, claims of unauthorized payments by a user and attempted payments by users with insufficient funds.

Bad actors use increasingly sophisticated methods to engage in illegal activities involving personal information, such as

unauthorized use of another person’s identity, account information or payment information and unauthorized acquisition or use

of credit or debit card details, bank account information and mobile phone numbers and accounts. Under current credit card

practices, we may be liable for use of funds on our platform with fraudulent credit card data, even if the associated financial

institution approved the credit card transaction.

Acts of fraud may involve various tactics, including collusion. Successful exploitation of our systems could have negative

effects on our product offerings, services and user experience and could harm our reputation. Failure to discover such acts or

schemes in a timely manner could result in harm to our operations. In addition, negative publicity related to such schemes could

have an adverse effect on our reputation, potentially causing a material adverse effect on our business, financial condition and

results of operations. In the event of the occurrence of any such issues with our existing platform or product offerings,

substantial engineering and marketing resources and management attention, may be diverted from other projects to correct these

issues, which may delay other projects and the achievement of our strategic objectives.

In addition, any misappropriation of, or access to, users’ or other proprietary information or other breach of our information

security could result in legal claims or legal proceedings, including regulatory investigations and actions, or liability for failure

to comply with privacy and information security laws, including for failure to protect personal information or for misusing

personal information, which could disrupt our operations, force us to modify our business practices, damage our reputation and

expose us to claims from our users, regulators, employees and other persons, any of which could have an adverse effect on our

business, financial condition and results of operations.

Despite measures we have taken to detect and reduce the occurrence of fraudulent or other malicious activity on our platform,

we cannot guarantee that any of our measures will be effective or will scale efficiently with our business. Our failure to

adequately detect or prevent fraudulent transactions could harm our reputation or brand, result in litigation or regulatory action

and lead to expenses that could adversely affect our business, financial condition and results of operations.

34

We are largely dependent on the skill and experience of management and key personnel.

We expect to experience strong competition in hiring and retaining qualified property and corporate management personnel,

including competition from Native American gaming facilities that are not subject to the same taxation regimes as we are and,

therefore, may be willing and able to pay higher rates of compensation. From time to time, a number of vacancies in key

corporate and property management positions can be expected. If we are unable to successfully recruit and retain qualified

management personnel at our facilities or at the corporate level, our results of operations could be adversely affected.

In addition, our officers, directors and key employees are required to file applications with the gaming authorities in each of the

jurisdictions in which we conduct our business and are required to be licensed or found suitable by these gaming authorities. If

the gaming authorities were to find an officer, director or key employee unsuitable for licensing or unsuitable to continue

having a relationship with us, we would have to sever all relationships with that person. Furthermore, the gaming authorities

may require us to terminate the employment of any person who refuses to file appropriate applications. Either result could

significantly impair our operations. The time and effort needed to successfully complete the application process could impact

our ability to attract, hire and retain top talent.

We are subject to risks associated with labor relations, labor costs and labor disruptions.

We are subject to the costs and risks generally associated with labor disputes and organizing activities related to unionized

labor. From time to time, our operations may be disrupted by strikes, public demonstrations or other coordinated actions and

publicity. We may incur increased legal costs and indirect labor costs as a result of contractual disputes, negotiations or other

labor-related disruptions.

A large number of our employees at our Casinos & Resorts properties within several US states are represented by a labor union

and are subject to collective bargaining agreements with us. As of December 31, 2025, we had 36 collective bargaining

agreements covering 3,679 employees. Our collective bargaining agreements generally have three-or-five-year terms. There can

be no assurance that we will be able to extend or enter into replacement agreements. If we are able to extend or enter into

replacement agreements, there can be no assurance as to whether the terms will be on comparable terms to the existing

agreements. We may also face organizing activities that could result in additional employees becoming unionized. Furthermore,

labor regulation and the negotiation of new or existing collective bargaining agreements could lead to higher wage and benefit

costs, changes in work rules that raise operating expenses and legal costs thereby affecting our profitability or interfering with

the ability of our management to focus on executing our business strategies, and could impose limitations on our ability to

reduce the size of our workforce during an economic downturn, which could put us at a competitive disadvantage.

Our obligation to fund multi-employer defined benefit pension plans to which we are a party may adversely affect us.

We must contribute to a number of multi-employer defined benefit pension plans under the terms of collective-bargaining

agreements that cover certain union-represented employees. The risks of participating in these multi-employer plans are

different from single-employer plans in the following aspects:

•assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other

participating employers;

•if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the

remaining participating employers; and

•if we choose to stop participating in some of our multi-employer plans, we may be required to pay those plans an

amount based on the underfunded status of the plan, referred to as a withdrawal liability.

In addition, the funding obligations for our pension plans will be impacted by the performance of the financial markets,

particularly the equity markets and interest rates. Funding obligations are determined by government regulations and are

measured each year based on the value of assets and liabilities on a specific date. If the financial markets do not provide the

long-term returns that are expected, we could be required to make larger contributions. The equity markets can be very volatile,

and, therefore, our estimate of future contribution requirements can change dramatically in relatively short periods of time.

Similarly, changes in interest rates and legislation enacted by governmental authorities can impact the timing and amounts of

contribution requirements. An adverse change in the funded status of the plans could significantly increase our required

contributions in the future and adversely impact our liquidity.

35

We may incur impairments to goodwill, indefinite-lived intangible assets or long-lived assets.

We monitor the recoverability of our long-lived assets, such as buildings, and evaluate their carrying value for impairment

whenever events or changes in circumstances indicate that the carrying amount of such assets may not be fully recoverable. We

annually review goodwill to determine if impairment has occurred. Additionally, interim reviews are performed whenever

events or changes in circumstances indicate that impairment may have occurred. If the testing performed indicates that

impairment has occurred, we are required to record a non-cash impairment charge for the difference between the carrying value

and fair value of the long-lived assets or the carrying value and fair value of the reporting unit, in the period the determination is

made. The testing of long-lived assets and goodwill for impairment requires us to make estimates that are subject to significant

assumptions about our future revenue, profitability, cash flows, fair value of assets and liabilities, weighted average cost of

capital, as well as other assumptions. Changes in these estimates, or changes in actual performance compared with these

estimates, may affect the fair value of long-lived assets or reporting unit, which may result in an impairment charge.

We cannot accurately predict the amount or timing of any impairment of assets. Should the value of long-lived assets or

goodwill become impaired, our financial condition and results of operations may be adversely affected.

Our operations have historically been subject to seasonal variations and quarterly fluctuations in operating results, and we

can expect to experience such variations and fluctuations in the future.

Casino, hotel and racing operations in our markets are subject to seasonal variation. Seasonal weather conditions can frequently

adversely affect transportation routes to each of our properties and may cause snowfall, flooding and other effects that result in

the closure of our properties. In addition, our sports betting business may experience seasonality based on the relative

popularity of certain sports at different parts of the year. As a result, unfavorable seasonal conditions could have a material

adverse effect on our business, financial condition and results of operations.

Our business is particularly sensitive to energy prices and a rise in energy prices could harm our operating results.

We are a large consumer of electricity and other energy and, therefore, higher energy prices may have an adverse effect on our

results of operations. Accordingly, increases in energy costs may have a negative impact on our operating results. Additionally,

higher electricity and gasoline prices that affect our customers may result in reduced visitation to our properties and a reduction

in our revenues. We may be indirectly impacted by regulatory requirements aimed at reducing the impacts of climate change

directed at up-stream utility providers, as we could experience potentially higher utility, fuel and transportation costs.

Expectations relating to environmental, social and governance considerations expose us to potential liabilities, reputational

harm and other unforeseen adverse effects on our business.

Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on

environmental, social and governance and sustainability considerations relating to businesses, including climate change and

greenhouse gas emissions, data privacy, artificial intelligence, human capital and diversity, equity and inclusion. We make

statements about goals and initiatives through information provided on our website, press statements and other

communications. Responding to these considerations and implementation of these goals and initiatives involves risks and

uncertainties and requires ongoing investments. The success of our goals and initiatives may be impacted by factors that are

outside our control. In addition, some stakeholders may disagree with our goals and initiatives and the focus and views of

stakeholders may change and evolve over time and vary depending on the jurisdictions in which we operate. Any failure, or

perceived failure, by us to achieve our goals, further our initiatives, adhere to our public statements, comply with federal, state

or international environmental, social and governance laws and regulations, or meet evolving and varied stakeholder

expectations and views could materially adversely affect our business, financial condition and results of operations.

36

Our insurance and self-insurance programs may not be adequate to cover future claims.

Although we maintain insurance that we believe is customary and appropriate for our business, we cannot assure that such

insurance programs will be available or adequate to cover all losses and damage to which our business or our assets might be

subjected. We use a combination of insurance and self-insurance to provide for potential liabilities, including employee

healthcare benefits, up to certain stop-loss amounts which limit our exposure above the amounts we have self-insured. We

estimate the liabilities and required reserves associated with the risks we retain. Any such estimates and actuarial projection of

losses is subject to a considerable degree of variability. If actual losses incurred are greater than those anticipated, our reserves

may be insufficient and additional costs could be recorded in our consolidated financial statements. If we suffer a substantial

loss that exceeds our self-insurance reserves, and any excess insurance coverage, the loss and attendant expenses could harm

our business, financial condition or results of operations. The lack of adequate insurance for certain types or levels of risk could

expose us to significant losses in the event that a catastrophe occurred for which we are uninsured or underinsured. Any losses

we incur that are not adequately covered by insurance may decrease our future operating income, require us to find

replacements or repairs for destroyed property and reduce the funds available for payments of our obligations. We renew our

insurance policies on an annual basis. The cost of coverage may become so high that we may need to further reduce our policy

limits, further increase our deductibles or agree to certain exclusions from our coverage.

We may be unable to protect our intellectual property rights.

We develop intellectual property to differentiate our retail casinos and interactive products from our competitors. Our brands

and technology constitute key business assets. In order to protect our brands, technology and other creative output, we rely on a

combination of trademarks, copyright, patents, trade secrets and contract law to establish and protect our proprietary rights. For

example, the Bally’s and Bally brand are protected by approximately 170 trademark registrations and applications in the U.S.

and foreign jurisdictions. While we take action to protect our intellectual property rights, there is always a risk that (i) our

proprietary rights become invalidated or unenforceable, (ii) we are unsuccessful in obtaining trademark or patent registrations

and (iii) we are unsuccessful in our enforcement efforts and, therefore, unable to prevent what we consider to be misuse of our

intellectual property assets. In addition, the laws of some foreign countries do not protect intellectual property rights to the same

extent as the laws of the United States. Finally, third parties may independently develop similar brands and technologies which

would negatively impact the value of our intellectual property.

Our results of operations and financial condition could be adversely affected by the occurrence of natural disasters, such as

hurricanes, or other catastrophic events, including war, terrorism and public health crises such as the COVID-19 pandemic.

In addition, results could be adversely impacted by other events beyond our control, including travel disruptions.

Natural disasters, such as major hurricanes, typhoons, tornados, floods, fires and earthquakes, could adversely affect our

business and operating results. Hurricanes are common in the areas in which our Mississippi and Louisiana properties are

located, and the severity of such natural disasters is unpredictable.

Catastrophic events, such as terrorist attacks and global and regional conflicts (e.g., the wars in Ukraine and Iran), have had a

negative effect on travel and leisure expenditures, including lodging, gaming (in some jurisdictions) and tourism. These events

can also lead to unstable market and economic conditions and have additional global consequences. We cannot accurately

predict the extent to which such events may affect us, directly or indirectly, in the future.

Public health crises may also significantly impact our business. For example, the global spread of the COVID-19 pandemic,

which began in early 2020, resulted in governments, public institutions and other organizations imposing or recommending, and

businesses and individuals implementing, restrictions on various activities or other actions to combat its spread, such as

restrictions and bans on travel or transportation, stay-at-home directives, requirements that individuals wear masks or other face

coverings, limitations on the size of gatherings, closures of work facilities, schools, public buildings and businesses,

cancellation of events, including sporting events, concerts, conferences and meetings and quarantines and lock-downs. The

pandemic and its consequences dramatically reduced travel and demand for hotel rooms and other casino resort amenities,

which had a negative impact on our results in 2020 and 2021. There are no assurances that future pandemics or other public

health crises will not cause similar disruptions that existed in 2020 and 2021.

In addition, other events beyond our control, such as travel disruptions impacting the ability of people to travel to our casino

properties, could impact our business. For example, the closure of Washington Bridge in Rhode Island has impacted foot traffic

at our Rhode Island properties, particularly Bally’s Twin River.

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There can be no assurance that we will be able to obtain or choose to purchase any insurance coverage with respect to

occurrences of catastrophic events, such as those described above. If there is a prolonged disruption at our facilities due to

natural disasters, terrorist attacks, wars, public health crises or other catastrophic events, our results of operations and financial

condition would be adversely affected.

Cybersecurity and Technology Risks

We rely on information technology and other systems and platforms, and any failures, errors, defects or disruptions in our

systems or platforms could diminish our brand and reputation, subject us to liability, disrupt our business, affect our ability

to scale our technical infrastructure and adversely affect our operating results and growth prospects.

We engage a number of third parties to provide gaming operating systems for the facilities we own. As a result, we rely on such

third parties to provide uninterrupted services in order to run our business efficiently and effectively. In the event one of these

third parties experiences a disruption in its ability to provide such services (whether due to technological or financial difficulties

or power problems), this may result in a material disruption to the wagering activity at the casinos which we own and have a

material adverse effect on our business, operating results and financial condition.

If our user base and engagement continue to grow, and the amount and types of offerings continue to grow and evolve, we will

need an increasing amount of technical infrastructure, including network capacity and computing power, to continue to satisfy

our users’ needs. Such infrastructure expansion may be complex, and unanticipated delays in completing these projects or

availability of components may lead to increased project costs, operational inefficiencies or interruptions in the delivery or

degradation of the quality of our offerings. In addition, there may be issues related to this infrastructure that are not identified

during the testing phases of design and implementation, which may only become evident after we have started to fully use the

underlying equipment or software, that could further degrade the user experience or increase our costs. As such, we could fail to

continue to effectively scale and grow our technical infrastructure to accommodate increased demands. In addition, our business

may be subject to interruptions, delays or failures resulting from adverse weather conditions, other natural disasters, power loss,

terrorism, cyber-attacks, public health emergencies (such as the coronavirus) or other catastrophic events. Any unscheduled

interruption in our technology services is likely to result in an immediate, and possibly substantial, loss of revenues due to a

shutdown of our gaming operations, cloud computing and lottery systems.

We believe that if our users have a negative experience with our offerings, or if our brand or reputation is negatively affected,

users may be less inclined to continue or resume utilizing our products or recommend our platform to other potential users. As

such, a failure or significant interruption in our service would harm our reputation, business and operating results.

We are reliant on the reliability and viability of internet infrastructure, which is out of our control, and the proper

functioning of our own network systems.

The growth of internet usage has caused interruptions and delays in processing and transmitting data over the internet. There

can be no assurance that internet infrastructure or our own network systems will continue to be able to support the demands

placed on them by the continued growth of the internet, the overall online gambling industry or that of our customers. The

internet’s viability could be affected by delays in the development or adoption of new standards and protocols to handle

increased levels of internet activity or by increased government regulation. The introduction of legislation or regulations

requiring internet service providers in any jurisdiction to block access to our websites and products may restrict the ability of

our customers to access products and services offered by us. Such restrictions, should they be imposed, could have a material

adverse effect on our business, financial condition and results of operations.

If critical issues concerning the commercial use of the internet are not favorably resolved (including security, reliability, cost,

ease of use, accessibility and quality of service), if the necessary infrastructure is not sufficient or if other technologies and

technological devices eclipse the internet as a viable channel, this may negatively affect internet usage, and our business,

financial condition and results of operations will be materially adversely affected. Additionally, the increasing presence of

viruses and cyber-attacks may affect the viability and infrastructure of the internet and/or the proper functioning of our network

systems and could materially adversely affect our business, financial condition and results of operations.

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Our business may be harmed from cybersecurity incidents and we may be subject to legal claims if there is loss, disclosure or

misappropriation of or access to our customers’, business partners’ or our own information or other breaches of

information security.

We make extensive use of online services and centralized data processing, including through third-party service providers. We

have experienced certain cyber-attacks, attempts to breach our systems and other similar incidents. The secure maintenance and

transmission of customer information is a critical element of our operations. Our information technology and other systems, or

those of service providers and business partners, that maintain and transmit customer or employee information may be

compromised by a malicious third-party penetration of our network security, or that of a third-party service provider or business

partner or impacted by intentional or unintentional actions or inactions by our employees, or those of a third-party service

provider or business partner. As a result, our customers’ or employee’s information may be lost, disclosed, accessed, or taken

without our customers’ or employees’ consent.

In addition, third-party service providers and other business partners process and maintain proprietary business information and

data related to our employees, customers, suppliers and other business partners. Our information technology and other systems

that maintain and transmit this information, or those of service providers or business partners, may also be compromised by a

malicious third-party penetration of our network security or that of a third-party service provider or business partner, or

impacted by intentional or unintentional actions or inactions by our employees or those of a third-party service provider or

business partner. As a result, our business information or customer, supplier and other business partner data may be lost,

disclosed, accessed or taken without consent.

Any such loss, disclosure, or misappropriation of, or access to, customers’ or business partners’ information or other breach of

our information security can result in legal claims or legal proceedings, including regulatory investigations and actions, may

have a serious impact on our reputation and may adversely affect our business, operating results and financial condition.

Furthermore, the loss, disclosure or misappropriation of our business information may adversely affect our reputation, business,

operating results, and financial condition.

We may use AI in our business, and challenges with properly managing its use could result in reputational harm,

competitive harm and legal liability, and could have adverse effects on our business, operating results, and financial

condition.

We may incorporate AI solutions into our business, and we may leverage AI, including generative AI, into our business

operations. Our competitors or other third parties, like third-party distribution channels, may incorporate AI into their products

more quickly or more successfully than we do, which could impair our ability to compete effectively and could adversely affect

our business, operating results, and financial condition. In addition, there are significant risks in using AI, and there can be no

assurance that the use of AI will enhance our business or be beneficial to our business operations, including our efficiency or

our profitability.

Additionally, if our AI applications, or the AI applications of third parties, are based on data, algorithms or other inputs that are

flawed, or if our AI applications, or the AI applications of third parties, assist us in producing content, analyses or

recommendations that are, or are alleged to be, deficient, inaccurate or biased, our business, results of operations and financial

conditions may be adversely affected. The increased use of AI applications generally has resulted in, and may in the future

result in, cybersecurity incidents that implicate the personal data of end users of such applications. Any such cybersecurity

incidents related to our own use of AI applications may increase our cybersecurity risks, as well as the cybersecurity risks of

third parties, which could adversely affect our reputation and results of operations. AI also presents emerging ethical issues, and

if our use of AI becomes controversial, we may experience brand, reputational or competitive harm, or legal liability. The rapid

evolution of AI, including the potential regulation of AI by governmental or other regulatory agencies, will require significant

resources to develop, test and implement AI ethically and to minimize any unintended, harmful impacts.

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Financing Risks

Our debt agreements and the Regulatory Agreement contain restrictive covenants that may limit our operating flexibility.

Our current debt agreements and the Regulatory Agreement include, and our future debt agreements and regulatory agreements

will likely include numerous financial and other covenants, imposing financial and operating restrictions on our business. Our

ability to comply with these provisions may be affected by general economic conditions, industry conditions and other events

beyond our control. There can be no assurance that we will be able to comply with these covenants. The failure to comply with

a financial covenant or other restriction contained in the agreements governing our indebtedness or in the Regulatory

Agreement may result in an event of default under such agreements or sanctions or fines under the Regulatory Agreement. An

event of default under our debt agreements could result in acceleration of some or all the applicable indebtedness as well as

other indebtedness of ours and the inability to borrow additional funds. We do not have, and cannot be certain we would be able

to obtain, sufficient funds to repay any such indebtedness if it is accelerated. Restrictions in our debt agreements or in the

Regulatory Agreement might affect our ability to operate our business, might limit our ability to take advantage of potential

business opportunities as they arise and might adversely affect the conduct of our current business, including by restricting our

ability to finance future operations and capital needs and limiting our ability to engage in other business activities.

Our existing and future indebtedness may limit our operating and financial flexibility.

As of December 31, 2025, we had approximately $4.94 billion of total indebtedness outstanding consisting of $1.47 billion

outstanding under our term loan facility (the “Term Loan”) pursuant to the terms of a credit agreement we entered into on

October 1, 2021 (the “Credit Agreement”) with Deutsche Bank AG New York Branch, as administrative agent and collateral

agent, and the lenders party thereto, and $1.5 billion in aggregate principal amount of outstanding 5.625% senior notes due

2029 and 5.875% senior notes due 2031. As of December 31, 2025, we had $588.1 million available under our revolving credit

facility (the “Revolving Credit Facility” or “Revolver” and, together with the Term Loan, the “Credit Facility”). On February

11, 2026, we issued $1.1 billion Term Loans and repaid the previously outstanding $1.47 billion Term Loan. This indebtedness

may have important negative consequences for us, including:

•limiting our ability to satisfy obligations;

•increasing vulnerability to general adverse economic and industry conditions;

•limiting flexibility in planning for, or reacting to, changes in our businesses and the markets in which we conduct

business;

•increasing vulnerability to, and limiting our ability to react to, changing market conditions, changes in industry and

economic downturns;

•limiting our ability to obtain additional financing to fund working capital requirements, capital expenditures, debt

service, general corporate or other obligations;

•subjecting us to a number of restrictive covenants that, among other things, limit our ability to pay dividends and

distributions, make acquisitions and dispositions, borrow additional funds and make capital expenditures and other

investments;

•limiting our ability to use operating cash flow in other areas of our business because we must dedicate a significant

portion of these funds to make principal and/or interest payments on outstanding debt;

•exposing us to interest rate risk due to the variable interest rate on borrowings under our Credit Facility;

•causing our failure to comply with the financial and restrictive covenants contained in our current or future

indebtedness, which could cause a default under that indebtedness (and other indebtedness of ours) and which, if not

cured or waived, could adversely affect us; and

•affecting our ability to renew gaming and other licenses necessary to conduct our business.

Though we have significant amounts of indebtedness outstanding, as of December 31, 2025, we have the ability to borrow the

remaining amount available under our Revolving Credit Facility and may issue or incur additional indebtedness to fund our

operations, including as necessary to execute on our growth strategy. Further, we may incur other liabilities that do not

constitute indebtedness under the Credit Facility. The risks that we face based on our outstanding indebtedness may intensify if

we incur additional indebtedness or financing obligations in the future.

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Servicing our indebtedness and funding our other obligations requires a significant amount of cash, and our ability to

generate sufficient cash depends on many factors, some of which will be beyond our control.

Our ability to make payments on and refinance our indebtedness and to fund our operations and capital expenditures depends

upon our ability to generate cash flow and secure financing in the future. Our ability to generate future cash flow depends,

among other things, upon:

•general economic conditions;

•competition;

•legislative and regulatory factors affecting our operations and businesses; and

•our future operating performance.

Some of these factors will be beyond our control. There can be no assurance that our business will generate cash flow from

operations, or that future debt or equity financings will be available to us to enable us to pay our indebtedness or to fund other

needs. If our operating results and available cash are insufficient to meet our debt service obligations, we could face substantial

liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other

obligations. We may not be able to consummate those dispositions or to obtain the proceeds that we could realize from them,

and these proceeds may not be adequate to meet any debt service obligations then due. The inability to generate cash flow could

result in us needing to refinance all or a portion of our indebtedness on or before maturity, including through the issuance of

additional debt or equity securities. If needed, there can be no assurance that we will be able to refinance any of our

indebtedness on favorable terms, or at all. Any inability to generate sufficient cash flow or refinance our indebtedness on

favorable terms could adversely affect our financial condition.

Our variable rate indebtedness exposes us to interest rate volatility, which could cause our debt service obligations to

increase significantly.

Borrowings under our Credit Facility are at variable rates of interest, such as the Secured Overnight Financing Rate (“SOFR”),

and expose us to interest rate volatility. If interest rates increase, our debt service obligations on certain of our variable rate

indebtedness will increase even though the amount borrowed remains the same.

A market downturn may negatively impact our access to financing.

A downturn in the financial markets or market volatility could negatively impact our ability to access capital and financing

(including financing necessary for acquisitions or to refinance our existing indebtedness) on acceptable terms and prices, that

we would otherwise need in connection with the operation of our business.

Risks Related to our Common Stock

The market price of our common stock could fluctuate significantly.

There have been and are periods of time when the US securities markets have experienced significant price fluctuations. These

price fluctuations may be day-to-day or they may last for extended periods of time. Significant price fluctuations in the

securities markets as a whole have caused, and may continue to cause, the market price of our common stock to be volatile and

subject to wide fluctuations. The trading volume of our common stock may fluctuate and cause significant price variations to

occur. Additional factors that could cause fluctuations in, or adversely affect, our stock price or trading volume include:

•general market and economic conditions, including market conditions in the gaming and hotel industries;

•actual or expected variations in quarterly operating results;

•differences between actual operating results and those expected by investors and analysts;

•sales of our common stock by current shareholders seeking liquidity in the public market;

•changes in recommendations by securities analysts;

•operations and stock performance of competitors;

•accounting charges, including charges relating to the impairment of goodwill;

•significant acquisitions or strategic alliances by us or by competitors;

•sales of our common stock by our directors and officers or significant investors; and

•recruitment or departure of key personnel.

There can be no assurance that the stock price of our common stock will not fluctuate or decline significantly in the future. In

addition, the stock market in general can experience considerable price and volume fluctuations that may be unrelated to our

performance.

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Our largest shareholder owns a majority of our outstanding common stock, which could limit the ability of other

shareholders to influence corporate matters.

Standard General, our largest shareholder, beneficially owned 67.1% of our outstanding common stock as of February 28, 2026

and, therefore, is able to control the outcome of matters submitted to our stockholders for approval. Standard General’s

Managing Partner and Chief Investment Officer serves as the Executive Chairman of our Board. This concentrated control may

limit or preclude your ability to influence corporate matters.

We are a “controlled company” within the meaning of the corporate governance standards of NYSE. As a result, we qualify

for exemptions from certain corporate governance standards and our shareholders do not have the same protections

afforded to shareholders of companies that are subject to such requirements.

Standard General owns more than 50% of the total voting power of our outstanding common stock and we are a “controlled

company” under NYSE corporate governance standards. As a controlled company, we are not required by NYSE, for continued

listing of our common stock, to (i) have a majority of our board of directors consist of independent directors, (ii) maintain a

nominating and governance committee that is composed entirely of independent directors with a written charter addressing the

committee’s purpose and responsibilities or (iii) maintain a compensation committee that is composed entirely of independent

directors with a written charter addressing the committee’s purpose and responsibilities. For so long as we qualify as a

“controlled company,” we may rely on some or all of these exemptions from NYSE listing requirements, subject to the

provisions set forth in our Sixth Amended and Restated Certificate of Incorporation. In accordance with these exemptions, we

have elected not to comply with certain corporate governance requirements. Specifically, we no longer have a Nominating and

Governance Committee composed of entirely independent directors.

Accordingly, our shareholders do not have the same protections afforded to stockholders of companies that are subject to all of

the NYSE corporate governance requirements and the ability of our independent directors to influence our business policies and

affairs may be reduced. As a result, our status as a “controlled company” could make our common stock less attractive to some

investors or could otherwise harm our common stock price.

We are not paying dividends and any decision to do so in the future will be at the discretion of our Board.

The timing, declaration, amount, and payment of any future dividends will be at the discretion of our Board and will depend

upon, among other factors, our earnings, cash requirements, financial condition, requirements to comply with the covenants

under our debt agreements and the Regulatory Agreement, legal considerations and other factors that our Board deems relevant.

If we do not pay cash dividends on our common stock in the future, then the return on an investment in our common stock will

depend upon our future stock price and other forms of returning capital. There is no guarantee that our common stock will

maintain its value or appreciate in value.

We are a holding company and will depend on our subsidiaries for dividends, distributions and other payments.

We are structured as a holding company, a legal entity separate and distinct from our subsidiaries. Our only significant asset is

the capital stock or other equity interests of our operating subsidiaries. As a holding company, we will conduct all of our

business through our subsidiaries. Consequently, our principal source of cash flow will be dividends and distributions from our

subsidiaries. Our right to participate in a distribution of assets upon a subsidiary’s liquidation or reorganization will be subject

to the prior claims of the subsidiary’s creditors.

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