What changed in this filing

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Item 1. Financial Statements

2025-05-12 compared with 2024-11-08 · 543 added, 555 removed, 741 unchanged (60% of the section changed)

3 unchanged sentences

(In thousands, except share data)

September 30,

Successor Predecessor

2025 December 31,

5 unchanged sentences

Prepaid expenses and other current assets 162,231 115,471

Assets held for sale — 1,815

Total current assets 570,083 447,873

12 unchanged sentences

Accrued and other current liabilities 542,977 481,292

Liabilities related to assets held for sale — 1,307

Total current liabilities 763,866 677,808

Long-term debt, net 3,430,709 3,299,323

Long-term portion of financing obligation — 200,000

Long-term portion of lease liabilities 2,016,877 1,554,479

Deferred tax liability 338,120 118,214

Commercial rights liabilities 74,132 113,626

Other long-term liabilities 133,311 179,411

3 unchanged sentences

Common stock ($ 0.01 par value, 200,000,000 shares authorized;

40,653,346 and 39,973,202 shares issued;

40,653,346 and 39,973,202 shares outstanding)

49,011,796 (Successor) and 40,787,007 (Predecessor) shares issued;

49,011,796 (Successor) and 40,787,007 (Predecessor) shares outstanding)

Preferred stock ($ 0.01 par value;

2 unchanged sentences

Additional paid-in-capital 749,318 1,414,410

Treasury stock, at cost, no shares outstanding as of September 30, 2024 and December 31, 2023

Accumulated deficit ( 1,037,860 ) ( 555,895 )

Accumulated other comprehensive loss ( 140,245 ) ( 209,558 )

Retained earnings (deficit) 34,516 ( 1,123,649 )

Accumulated other comprehensive income (loss) 12,163 ( 260,267 )

Total Bally’s Corporation stockholders’ equity 796,486 30,902

6 unchanged sentences

(In thousands, except per share data)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Successor Predecessor

Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Gaming $ 313,779 $ 185,767 $ 516,057

5 unchanged sentences

General and administrative 160,391 114,401 248,436

Loss (gain) on sale-leaseback, net 150,000 — 150,000 ( 374,321 )

Depreciation and amortization 47,481 22,343 159,746

Total operating costs and expenses 370,504 241,264 692,437

(Loss) income from operations ( 157,655 ) 37,236 ( 226,037 ) 419,950

Loss from operations ( 1,810 ) ( 20,766 ) ( 73,955 )

Other (expense) income:

Interest expense, net ( 51,737 ) ( 27,229 ) ( 73,131 )

Other non-operating (expense) income, net ( 49,854 ) 15,528 ( 38,370 ) 24,949

Other non-operating income (expense), net ( 9,030 ) ( 2,365 ) 4,554

Total other expense, net ( 60,767 ) ( 29,594 ) ( 68,577 )

(Loss) income before income taxes ( 281,484 ) ( 17,866 ) ( 485,713 ) 243,912

Loss before income taxes ( 62,577 ) ( 50,360 ) ( 142,532 )

(Benefit) provision for income taxes ( 97,093 ) 664 31,382

Net (loss) income $ ( 247,855 ) $ ( 61,802 ) $ ( 481,965 ) $ 90,883

Basic (loss) earnings per share $ ( 5.10 ) $ ( 1.15 ) $ ( 9.96 ) $ 1.68

Net income (loss) $ 34,516 $ ( 51,024 ) $ ( 173,914 )

Basic earnings (loss) per share $ 0.57 $ ( 1.05 ) $ ( 3.61 )

Weighted average common shares outstanding - basic 60,322 48,743 48,119

Diluted (loss) earnings per share $ ( 5.10 ) $ ( 1.15 ) $ ( 9.96 ) $ 1.67

Diluted earnings (loss) per share $ 0.57 $ ( 1.05 ) $ ( 3.61 )

Weighted average common shares outstanding - diluted 60,729 48,743 48,119

3 unchanged sentences

(In thousands)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Net (loss) income $ ( 247,855 ) $ ( 61,802 ) $ ( 481,965 ) $ 90,883

Successor Predecessor

Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Net income (loss) $ 34,516 $ ( 51,024 ) $ ( 173,914 )

Other comprehensive income (loss):

3 unchanged sentences

Other comprehensive income (loss) 12,163 ( 9,443 ) ( 14,045 )

Total comprehensive (loss) income $ ( 163,704 ) $ ( 148,164 ) $ ( 412,652 ) $ 95,219

Total comprehensive income (loss) $ 46,679 $ ( 60,467 ) $ ( 187,959 )

See accompanying notes to condensed consolidated financial statements.

BALLY’S CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (unaudited)

(In thousands, except share data)

1 unchanged sentence

Paid-in Capital Treasury

Stock Accumulated Deficit Accumulated Other Comprehensive Loss Non-controlling Interest Total Stockholders’

Stock Accumulated Deficit Accumulated Other Comprehensive Loss Non-controlling Interest Total Stockholders’ Equity (Deficit)

Shares Outstanding Amount

2 unchanged sentences

Share-based compensation — — 1,954 — — — — 1,954

Settlement of consideration 86,368 1 ( 125 ) — — — — ( 124 )

Other — — 1,750 — — — — 1,750

Other comprehensive loss — — — — — ( 9,443 ) — ( 9,443 )

Net loss — — — — ( 51,024 ) — — ( 51,024 )

Balance as of March 31, 2024 40,483,375 $ 405 $ 1,402,384 $ — $ ( 729,809 ) $ ( 223,603 ) $ 428 $ 449,805

Issuance of restricted stock and other stock awards 135,981 1 262 — — — — 263

Share-based compensation — — 4,472 — — — — 4,472

Other comprehensive loss — — — — — ( 793 ) — ( 793 )

Net loss — — — — ( 60,196 ) — — ( 60,196 )

Balance as of June 30, 2024 40,619,356 $ 406 $ 1,407,118 $ — $ ( 790,005 ) $ ( 224,396 ) $ 428 $ 393,551

Balance as of February 7, 2025 (Predecessor) 40,806,667 408 1,416,288 — ( 1,174,673 ) ( 269,710 ) — ( 27,687 )

Common Stock Additional

Paid-in Capital Treasury

Stock Retained Earnings Accumulated Other Comprehensive Income Non-controlling Interest Total Stockholders’

Shares Outstanding Amount

Balance as of February 8, 2025 (Successor) 71,258,763 712 1,171,824 — — — — 1,172,536

Share repurchases ( 22,804,384 ) ( 228 ) ( 420,114 ) — — — — ( 420,342 )

Issuance of restricted stock and other stock awards 557,417 5 ( 5,132 ) — — — — ( 5,127 )

Bally’s Chicago Inc.

Issuance — — — — — — 12,361 12,361

Share-based compensation — — 2,740 — — — — 2,740

Other comprehensive income — — — — — 12,163 — 12,163

Net loss — — — — ( 247,855 ) — — ( 247,855 )

Balance as of September 30, 2024 40,653,346 $ 406 $ 1,411,114 $ — $ ( 1,037,860 ) $ ( 140,245 ) $ 428 $ 233,843

Net income — — — — 34,516 — — 34,516

Balance as of March 31, 2025 (Successor) 49,011,796 $ 489 $ 749,318 $ — $ 34,516 $ 12,163 $ 12,361 $ 808,847

BALLY’S CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (unaudited)

(In thousands, except share data)

3 unchanged sentences

Shares Outstanding Amount

Balance as of December 31, 2022 46,670,057 $ 466 $ 1,636,366 $ — $ ( 535,373 ) $ ( 295,640 ) $ 428 $ 806,247

Issuance of restricted stock and other stock awards 124,050 1 ( 1,332 ) — — — — ( 1,331 )

Share-based compensation — — 6,040 — — — — 6,040

Retirement of treasury shares — ( 10 ) ( 35,987 ) 19,753 16,244 — — —

Share repurchases ( 1,026,343 ) — — ( 19,753 ) — — — ( 19,753 )

Other comprehensive income — — — — — 52,073 — 52,073

Net income — — — — 178,336 — — 178,336

Balance as of March 31, 2023 45,767,764 $ 457 $ 1,605,087 $ — $ ( 340,793 ) $ ( 243,567 ) $ 428 $ 1,021,612

Issuance of restricted stock and other stock awards 125,842 1 ( 495 ) 529 — — — 35

Share-based compensation — — 6,290 — — — — 6,290

Retirement of treasury shares — ( 7 ) ( 25,279 ) 10,176 14,805 — — ( 305 )

Share repurchases ( 748,502 ) — — ( 10,705 ) — — — ( 10,705 )

Issuance of MKF penny warrants — — 7,371 — — — — 7,371

Penny warrants exercised 377,253 4 — — — — — 4

Settlement of consideration to SportCaller 103,656 1 1,883 — — — — 1,884

Other comprehensive income — — — — — 38,625 — 38,625

Net loss — — — — ( 25,651 ) — — ( 25,651 )

Balance as of June 30, 2023 45,626,013 $ 456 $ 1,594,857 $ — $ ( 351,639 ) $ ( 204,942 ) $ 428 $ 1,039,160

Balance as of December 31, 2023 (Predecessor) 39,973,202 $ 400 $ 1,400,479 $ — $ ( 555,895 ) $ ( 209,558 ) $ 428 $ 635,854

Issuance of restricted stock and other stock awards 423,805 4 ( 2,778 ) — — — — ( 2,774 )

Share-based compensation — — 3,058 — — — — 3,058

Retirement of treasury shares — — ( 1,420 ) 601 813 — — ( 6 )

Settlement of consideration - Bally’s Interactive ( 40,451 ) — 601 ( 601 ) — — — —

Settlement of consideration 86,368 1 ( 125 ) — — — — ( 124 )

Other — — 1,750 — — — — 1,750

Other comprehensive loss — — — — — ( 14,045 ) — ( 14,045 )

Net loss — — — — ( 173,914 ) — — ( 173,914 )

Balance as of September 30, 2023 45,616,627 $ 456 $ 1,600,115 $ — $ ( 412,628 ) $ ( 291,304 ) $ 428 $ 897,067

Balance as of March 31, 2024 (Predecessor) 40,483,375 $ 405 $ 1,402,384 $ — $ ( 729,809 ) $ ( 223,603 ) $ 428 $ 449,805

See accompanying notes to condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

Nine Months Ended September 30,

(in thousands) 2024 2023

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Cash flows from operating activities:

Net (loss) income $ ( 481,965 ) $ 90,883

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Net income (loss) $ 34,516 $ ( 51,024 ) $ ( 173,914 )

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Depreciation and amortization 47,481 22,343 159,746

1 unchanged sentence

Share-based compensation 2,740 1,954 3,058

Impairment charges 12,757 9,653

Amortization of debt discount and debt issuance costs 14,648 1,004 2,877

Loss (gain) on sale-leaseback 150,000 ( 374,321 )

Gain on extinguishment of debt — ( 4,044 )

Loss on extinguishment of debt 17,372 — —

Deferred income taxes ( 71,798 ) ( 3,010 ) 26,890

Net (gain) loss on assets and liabilities measured at fair value ( 12,474 ) 12

Loss (gain) on equity method investments 284 ( 5,344 )

Change in value of commercial rights liabilities 10,615 ( 11,967 )

Change in fair value of equity method investments ( 5,544 ) — —

(Income) loss from equity method investments ( 863 ) 594 ( 555 )

Change in value of performance warrants — 1,180 —

Change in contingent consideration payable ( 867 ) 786 ( 1,835 )

Foreign exchange loss (gain) 26,447 ( 2,512 )

Proceeds from interest rate contracts 11,042 —

Foreign exchange gain ( 1,591 ) ( 194 ) ( 2,816 )

Other operating activities 854 1,545 ( 1,584 )

Changes in operating assets and liabilities ( 7,691 ) ( 62,592 ) ( 33,943 )

Net cash provided by operating activities 76,178 118,359

Net cash provided by (used in) operating activities 42,001 ( 80,186 ) ( 7,854 )

Cash flows from investing activities:

Cash paid for acquisitions, net of cash acquired 21,233 — 208

Proceeds from sale-leaseback — 411,000

Proceeds from net investment hedges 3,274 —

Capital expenditures ( 30,457 ) ( 16,424 ) ( 28,053 )

7 unchanged sentences

Deferred payables 8,973 11,064 42,195

Share repurchases — ( 30,458 )

Cash paid for repurchased shares ( 416,180 ) — —

Payment of financing fees ( 21,326 ) — —

Bally’s Chicago Inc.

issuance under private placement 12,361 — —

Other financing activities ( 5,132 ) ( 76 ) ( 6,005 )

Net cash provided by (used in) financing activities 75,708 ( 79,560 )

Effect of foreign currency on cash and cash equivalents 4,472 ( 2,251 )

Change in cash and cash equivalents and restricted cash held for sale — ( 1,648 )

Net cash provided by financing activities 14,073 97,988 51,327

Effect of foreign currency on cash and cash equivalents and restricted cash ( 1,497 ) ( 457 ) ( 4,445 )

Net change in cash and cash equivalents and restricted cash 33,780 ( 352 ) ( 4,373 )

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

Nine Months Ended September 30,

(in thousands) 2024 2023

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Supplemental disclosure of cash flow information:

4 unchanged sentences

Unpaid internally developed software 1,529 6,158 633

Bally’s Chicago - gaming license payable — 135,250

Consideration issued for the Company Merger 955,647 — —

Consideration issued for the Queen Merger 555,751 — —

Bally’s Chicago - land development liability — — 956

Investment in GLP Capital, L.P.

Investment in RI Joint Venture — 17,832

Net purchase consideration for acquisitions — 55,933

September 30, December 31,

Successor Predecessor

March 31, February 7, December 31,

Reconciliation of cash and cash equivalents and restricted cash:

2025 2025 2024

Cash and cash equivalents $ 209,727 $ 173,549 $ 171,233

38 unchanged sentences

Bally’s Golf Links at Ferry Point (“Bally’s Golf Links”) Bronx, New York Golf Course 2023

The Queen Baton Rouge (2)

Baton Rouge, Louisiana Casino 2025

The Belle of Baton Rouge (2)

Baton Rouge, Louisiana Casino and Hotel 2025

Casino Queen Marquette (2)

Marquette, Iowa Casino 2025

DraftKings at Casino Queen (2)

Louis, Illinois Casino and Hotel 2025

__________________________________

4 unchanged sentences

Site of future permanent casino resort is leased from GLPI.

The Company’s International Interactive reportable segment primarily includes the interactive activities in Europe and Asia of Gamesys Group Ltd.

(“Gamesys”), an iCasino and online bingo platform provider and operator.

The Company’s International Interactive reportable segment includes the Company’s interactive European gaming operations, the Company’s global licensing revenue generating operations, as well as one casino property, Bally’s Newcastle, in the UK.

The North America Interactive reportable segment includes a portfolio of sports betting, iGaming, and free-to-play gaming brands, and the North American operations of Gamesys.

Refer to Note 19 “ Segment Reportin g” for further information.

Agreement and Plan of Merger

On July 25, 2024, the Company entered into an Agreement and Plan of Merger (as amended, the “Merger Agreement”) with SG Parent LLC, a Delaware limited liability company (“Parent”), The Queen Casino & Entertainment, Inc., a Delaware corporation and affiliate of Parent (“Queen”), Epsilon Sub I, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub I”), Epsilon Sub II, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub II”, and together with the Company and Merger Sub I, the “Company Parties”), and, solely for purposes of specified provisions thereof, SG CQ Gaming LLC, a Delaware limited liability company (“SG Gaming” and together with Parent and Queen, the “Buyer Parties”).

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The Merger Agreement provides, among other things and on the terms and subject to the conditions therein, in connection with the closing of the transaction, (i) SG Gaming will contribute to the Company all shares of common stock of Queen that it owns (the “Queen Share Contribution”) in exchange for 26,909,895 shares of common stock of the Company (“Company Common Stock”) based on a 2.45368905950 share exchange ratio, (ii) the Company will issue approximately 3,542,205 shares of Company Common Stock to the other stockholders of Queen, (iii) immediately thereafter, Merger Sub I will merge into the Company (the “Company Merger”), with the Company surviving the Company Merger and (iv) immediately thereafter, Merger Sub II will merge into Queen (the “Queen Merger,” and together with the Company Merger, the “Mergers”), with Queen surviving the Queen Merger as a direct, wholly owned subsidiary of the Company.

The transaction is expected to close in the first calendar quarter of 2025, subject to the satisfaction of closing conditions contained in the Merger Agreement, including approval of the Company Merger by (a) the affirmative vote of the holders of a majority of all of the outstanding shares of Company Common Stock entitled to vote;

(b) the affirmative vote of the holders of a majority of the outstanding shares of Company Common Stock held by the unaffiliated stockholders of the Company entitled to vote;

(c) the expiration of any waiting period applicable to the consummation of the Queen Share Contribution or Mergers under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (which has occurred) and (d) receipt of specified gaming approvals by the Company and Queen (as defined in the Merger Agreement).

Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of the Company’s Common Stock issued and outstanding immediately prior to the Effective Time (other than shares of common stock owned by (i) the Company or any of its wholly owned subsidiaries, (ii) Parent or any of Parent’s affiliates, (iii) by holders exercising statutory appraisal rights;

Agreement and Plan of Merger

On February 7, 2025, the Company completed the previously announced transactions under the Agreement and Plan of Merger (as amended, the “Merger Agreement”) with SG Parent LLC, a Delaware limited liability company (“Parent”), The Queen Casino & Entertainment, Inc., a Delaware corporation and affiliate of Parent (“Queen”), Epsilon Sub I, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub I”), Epsilon Sub II, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub II”, and together with the Company and Merger Sub I, the “Company Parties”), and, solely for purposes of specified provisions thereof, SG CQ Gaming LLC, a Delaware limited liability company (“SG Gaming” and together with Parent and Queen, the “Buyer Parties”).

As a result of the transactions, Parent and its affiliates beneficially own 73.8% of the issued and outstanding Company common stock

Pursuant to the Merger Agreement, (i) SG Gaming contributed to the Company all shares of common stock of Queen that it owns (the “Queen Share Contribution”) in exchange for 26,909,895 shares of common stock of the Company (“Company Common Stock”) based on a 2.4536890595 share exchange ratio, (ii) the Company issued approximately 3,542,201 shares of Company Common Stock to the other stockholders of Queen, (iii) immediately thereafter, Merger Sub I merged into the Company (the “Company Merger”), with the Company surviving the Company Merger and (iv) immediately thereafter, Merger Sub II merged into Queen (the “Queen Merger,” and together with the Company Merger, the “Merger”), with Queen surviving the Queen Merger as a direct, wholly owned subsidiary of the Company.

At the effective time of the Merger, each share of the Company’s Common Stock issued and outstanding (other than shares of common stock owned by (i) the Company or any of its wholly owned subsidiaries, (ii) Parent or any of Parent’s affiliates, (iii) by holders exercising statutory appraisal rights;

(iv) by SG Gaming following the Queen Share Contribution;

or (v) by holders who have elected to have such shares remain issued and outstanding following the Company Merger (a “Rolling Share Election”)) will be converted into the right to receive cash consideration equal to $ 18.25 per share of common stock (the “Per Share Price”).

Each holder of shares of Company Common Stock (other than the Company or its subsidiaries) will have the option to make a Rolling Share Election.

The Merger Agreement contains customary representations, warranties and covenants of the Company Parties and the Buyer Parties, including, among others, covenants by each the Company and Queen relating (i) to conduct of their respective business prior to the closing of the Queen Share Contribution and the Mergers in the ordinary course during the period between the execution of the Merger Agreement and consummation of the Merger and (ii) not to engage in certain expressly enumerated transactions during such period.

Under the terms of the Merger Agreement, the Company is subject to a customary “no-shop” provision that restricts the Company and its representatives from soliciting an alternative acquisition proposal (as described in the Merger Agreement) from third parties or providing information to or participating in any discussions or negotiations with third parties regarding any alternative acquisition proposal.

However, prior to the receipt of the requisite approval of the holders of Company Common Stock, the “no-shop” provision permits the Company, under certain circumstances and in compliance with certain obligations set forth in the Merger Agreement, to provide non-public information and engage in discussions and negotiations with respect to an unsolicited alternative acquisition that would reasonably be expected to lead to a Superior Proposal (as defined in the Merger Agreement).

The Merger Agreement also contains certain termination rights for the Company and Parent, with a termination fee equal to $ 11,100,000 payable by the Company to Parent under certain circumstances and a termination fee equal to $ 22,200,000 in cash or stock payable by Parent to the Company under certain circumstances.

In addition, the Company or Parent may terminate the Merger Agreement if the Merger is not consummated by July 25, 2025.

The Merger Agreement, the Merger and the transactions contemplated thereby were (i) unanimously recommended by a special committee of the board of directors of the Company (the “Board”), consisting solely of disinterested members of the Board, on July 24, 2024 and (ii) approved by the disinterested members of the Board on July 24, 2025.

The foregoing descriptions of the Merger, the Merger Agreement, and the transactions contemplated thereby are not complete and are subject to and qualified in their entirety by the full text of the Merger Agreement, which is attached as an exhibit to, and described in, the Company’s Current Report on Form 8-K filed with the SEC on July 25, 2024, and amendments thereto were attached as an exhibit to, and described in, the Company’s Current Reports on Forms 8-K filed with the SEC on August 28, 2024 and October 1, 2024, respectively.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Concurrently with the execution of the Merger Agreement, the Company and Parent entered into support agreements with Standard RI Ltd.

(“SRL”) (the “SG Support Agreement”), SBG Gaming, LLC, a designated subsidiary of Sinclair (“SBG”) (the “SBG Support Agreement”), and Noel Hayden (the “Hayden Support Agreement”), each dated as of July 25, 2024 (collectively, the “Support Agreements”), pursuant to which each of them agreed, among other things, to vote their shares of Company Common Stock to adopt and approve the Merger Agreement and the other transactions contemplated by the Merger Agreement and to make a Rolling Share Election with respect to all shares of Company Common Stock owned or acquired by them, if any, including via the exercise of outstanding options or warrants.

In addition, with respect to the SBG Support Agreement, the Company and SBG agreed that SBG would waive the right to receive the Per Share Price as the result of any exercise of performance warrants or options held by SBG.

The SBG Support Agreement provides also that, simultaneously with the consummation of the transactions contemplated by the Merger Agreement, SBG will deliver to the Company the options it previously acquired from the Company to purchase 1,639,669 shares of Company Common Stock at prices between $ 30.00 and $ 45.00 per share for cancellation and retirement and in exchange therefor, the Company will issue to SBG warrants to purchase 384,536 shares of Company Common Stock containing terms substantially similar to the terms set forth in certain warrants currently held by SBG.

The foregoing descriptions of the Support Agreements are not complete and are subject to and qualified in their entirety by reference to each of the SG Support Agreement, SBG Support Agreement and Hayden Support Agreement, each of which is attached as an exhibit to, and described in, the Company’s Current Report on Form 8-K filed with the SEC on July 25, 2024.

or (v) by holders who have elected to have such shares remain issued and outstanding following the Company Merger (a “Rolling Share Election”)) were converted into the right to receive cash consideration equal to $ 18.25 per share of common stock (the “Per Share Price”).

Each holder of shares of Company Common Stock (other than the Company or its subsidiaries) had the option to make a Rolling Share Election.

Concurrently with the Merger Agreement, the Company and Parent entered into support agreements with Standard RI Ltd.

The Support Agreements obligated the parties to vote their respective shares in favor of the Merger Agreement and related transactions, and to make a Rolling Share Election for their shares, including those acquired through options or warrants.

Additionally, under the SBG Support Agreement, SBG agreed to waive its right to the options it previously acquired under a Framework Agreement originally entered into in 2020 (the “Framework Agreement”), upon completion of the Merger, and in exchange, the Company issued SBG warrants to purchase 384,536 shares of the Company’s common stock under substantially similar terms to the Penny Warrants issued to SBG under the Framework Agreement.

In connection with the Merger, as of February 7, 2025, all outstanding Performance Warrants became immediately exercisable at a price of $ 0.01 per share

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, its majority-owned subsidiaries and entities the Company identifies as variable interest entities (“VIEs”), of which the Company is determined to be the primary beneficiary.

All intercompany transactions and balances have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of the Company, its majority-owned subsidiaries and entities the Company identifies as variable interest entities (“VIEs”), of which the Company is determined to be the primary beneficiary.

All intercompany balances and transactions have been eliminated in consolidation.

Certain prior year amounts have been reclassified to conform to the current year’s presentation.

The financial statements of our foreign subsidiaries are translated into US Dollars (“USD”) using exchange rates in effect at period-end for assets and liabilities and average exchange rates during each reporting period for results of operations.

Adjustments resulting from financial statement translations are reflected as a separate component of accumulated other comprehensive loss.

Foreign currency transaction gains and losses are included in net loss.

Adjustments resulting from financial statement translations are reflected as a separate component of accumulated other comprehensive income (loss).

Foreign currency transaction gains and losses are included in net income (loss).

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules of the Securities and Exchange Commission (the “SEC”) for interim financial information, including the instructions to Form 10-Q and Rule 10-01 of the SEC’s Regulation S-X.

4 unchanged sentences

The actual results that we experience may differ materially from our estimates.

Equity Method Investments

On January 1, 2023, the Company and International Game Technology PLC (“IGT”) contributed certain tangible assets and leases to Rhode Island VLT Company, LLC (the “RI Joint Venture”) in exchange for equity interests of the RI Joint Venture.

The Company contributed video lottery terminals (“VLTs”) and player tracking equipment to the joint venture for a 40 % equity interest of the RI Joint Venture.

The 40 % ownership in the joint venture qualifies for equity method accounting.

In addition to this joint venture, the Company also has other investments in unconsolidated subsidiaries, which are accounted for using equity method accounting.

The Company records its share of net income or loss within “Other non-operating (expense) income, net” in the condensed consolidated statements of operations.

For the three months ended September 30, 2024 and 2023, the Company recorded (loss) income from equity method investments of $( 1.1 ) million and $ 2.3 million, respectively, and for the nine months ended September 30, 2024 and 2023, the Company recorded (loss) income from equity method investments of $( 0.3 ) million and $ 5.3 million, respectively.

As described in Note 1, “General Information”, the Company completed the Merger with Queen on February 7, 2025 (the “Closing”), with Queen surviving the Merger as a wholly-owned subsidiary of the Company.

The Merger with Queen was accounted for as a transaction between entities under common control due to the control of the Company and Queen by the Parent and its affiliates before and after the Merger.

The Company has elected to push down its Parent’s basis in its net assets into its unaudited condensed consolidated financial statements, and as a result, unless the context otherwise requires, the “Company,” for periods prior to the Closing refers to Bally’s (“Predecessor”), and for the periods after the Closing refers to the combined Company of Bally’s and Queen (“Successor” or the “Company”).

As a result of the Merger, the results of operations, financial position and cash flows of the Predecessor and the Successor are not directly comparable.

As Bally’s was deemed to be the predecessor entity, the historical financial statements of Bally’s became the historical financial statements of the combined Company, upon the consummation of the Merger.

As a result, the financial statements included in this report reflect (i) the historical operating results of Bally’s prior to the Merger and (ii) the combined results of the Company following the Closing.

The accompanying unaudited condensed consolidated financial statements include a Predecessor period, which includes the period through February 7, 2025 concurrent with the Merger, and a Successor period from February 8, 2025 through March 31, 2025.

A black line between the Successor and Predecessor periods has been placed in the condensed consolidated financial statements and in the tables to the notes to the condensed consolidated financial statements to highlight the lack of comparability between these two periods.

Queen is a regional gaming, hospitality and entertainment company that owns and operates four casinos across three states.

The Merger expands the Company’s Casinos & Resorts geographic footprint and enhances the Company’s development pipeline, which aligns with the Company’s broader strategic initiatives.

Certain adjustments have been made to Queen’s historical carrying values to conform accounting policies with the Company, with any such adjustments being recorded to equity.

The preliminary purchase price of Queen is estimated based on the fair value of all existing and outstanding shares of Queen that were exchanged for shares of Company common stock, with the net effect of the transaction being charged to equity.

The preliminary purchase price of Queen and adjustment to equity resulting from the merger consists of the following:

(in thousands, except share and per share data) Amount

Queen common stock outstanding on February 7, 2025 10,967,117

Per share ratio 2.45

Equivalent Bally’s common stock to be issued 26,909,895

Bally’s common stock issued to settle Queen’s outstanding warrant and restricted stock awards 3,542,201

Total Bally’s shares issued for Queen shares outstanding 30,452,096

Share price per Merger Agreement $ 18.25

Total purchase price $ 555,751

Queen net assets assumed 218,342

Equity adjustment associated with the Queen merger $ 337,409

For the period from February 8, 2025 to March 31, 2025 (Successor), revenue and net income for Queen were $ 34.7 million were $ 13.0 million, respectively.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Equity Method Investments

In 2025, following the Queen merger, the Company has an investment in Intralot S.A.

Integrated Lottery Systems and Services (“Intralot”), a Greek publicly listed company on the Athens Stock Exchange, that supplies integrated gaming and transaction processing systems, game content, sports betting management and interactive gaming services to the state-licensed gaming and lottery organizations worldwide.

The total initial investment represented approximately 26.9 % of the outstanding shares of Intralot.

The investment is accounted for as an equity method investment.

The investment is accounted for under the fair value option as the Company believes this best depicts the economics of the investment.

In 2024, the Company completed the sale of portions of its international interactive business in Asia and certain other international markets in its International Interactive reportable segment (the “Carved-Out Business”) to a company (the “Buyer”) formed by members of management of the Carved-Out Business.

In connection with the disposition, the Company acquired penny warrants that represent a 19.99 % fully diluted interest in the Buyer, for approximately $ 1.9 million.

The Company accounts for this interest as an equity method investment.

The Company also has other investments in unconsolidated subsidiaries, which are accounted for using equity method accounting.

The Company records its share of net income or loss and changes in fair value for equity method investments accounted for under the fair value option within “Other non-operating income (expense), net” in the condensed consolidated statements of operations.

Refer to Note 4 “Consolidated Financial Information” for further information.

Variable Interest Entities

6 unchanged sentences

Significant judgments related to these determinations include estimates about the current and future fair values and performance of assets held by these VIEs and general market conditions.

Management has analyzed and concluded that Breckenridge Curacao B.V.

(“Breckenridge”) is a VIE because it does not have sufficient equity investment at risk.

The Company has determined that it is the primary beneficiary and consolidates the VIE because (a) although the Company does not control all decisions of Breckenridge, the Company has the power to direct the activities of Breckenridge that most significantly impact its economic performance through various contracts with the entity and (b) the nature of these agreements between Breckenridge and the Company provides the Company with the obligation to absorb losses and the right to receive benefits based on fees that are based upon off-market rates and commensurate to the level of services provided.

The Company receives significant benefits in the form of fees that are not at market and commensurate to the level of services provided.

As a result, the Company consolidates all of the assets, liabilities and results of operations of Breckenridge and its subsidiaries in the accompanying condensed consolidated financial statements.

As of September 30, 2024 and December 31, 2023, Breckenridge had total assets of $ 166.6 million and $ 161.3 million, respectively, and total liabilities of $ 96.8 million and $ 87.7 million, respectively.

Breckenridge had revenues of $ 40.9 million and $ 71.5 million for the three months ended September 30, 2024 and 2023, respectively, and $ 149.4 million and $ 232.0 million for the nine months ended September 30, 2024 and 2023, respectively.

Management has analyzed and concluded that a trust, that was established in connection with the disposal of the Asia Interactive Business, is a VIE that will be consolidated based on the applicable criteria.

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), consolidated VIEs had total assets of $ 276.8 million and $ 263.9 million, respectively, and total liabilities of $ 36.3 million and $ 27.9 million, respectively.

Consolidated VIEs had total revenue of $ 4.9 million, $ 3.7 million, and $ 61.9 million for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

The Company may change its original assessment of a VIE upon subsequent events such as the modification of contractual arrangements that affect the characteristics or adequacy of the entity’s equity investments at risk and the disposition of all or a portion of an interest held by the primary beneficiary.

The Company performs this analysis on an ongoing basis.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Non-controlling interest

In the first quarter of 2025, Bally’s Chicago, Inc., a consolidated subsidiary of the Company, successfully completed a private placement (the “Private Placement”), whereby shares of Class A-1, A-2, A-3 and A-4 were issued to third parties for total consideration of $ 12.4 million, net of $ 0.8 million of issuance costs.

Based on the shares issued in the private placement the Company has a de minimus non-controlling interest in Bally’s Chicago, Inc.

as of March 31, 2025 (Successor).

Net income attributable to non-controlling interest was de minimus for the period from February 8, 2025 to March 31, 2025 (Successor).

Cash and Cash Equivalents and Restricted Cash

Cash and cash equivalents includes cash balances and highly liquid investments with an original maturity of three months or less.

Restricted cash includes player deposits, payment service provider deposits, cash collateral in connection with amounts previously due to the Chicago Tribune (refer to Note 8 “ Property and Equipment ”), and VLT and table games related cash payables to certain states where we operate, which are unavailable for the Company’s use.

Restricted cash includes player deposits, payment service provider deposits, and VLT and table games related cash payables to certain states where we operate, which are unavailable for the Company’s use.

Accounts Receivable, Net

Accounts receivable, net consists of the following:

September 30, December 31,

Successor Predecessor

March 31, December 31,

(in thousands) 2025 2024

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(1) Represents the Company’s share of VLT and table games revenue for Bally’s Twin River and Bally’s Tiverton due from the State of Rhode Island and for Bally’s Dover from the State of Delaware.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Deferred Payables

1 unchanged sentence

In certain cases, where the Company is not able to extend payment terms directly with suppliers or vendors, the Company will consider deferred payable solutions that simulate such trade term extensions.

These solutions generally involve entering into exchange agreements with intermediary institutions who will make payment to the supplier or vendor within the original terms on behalf of the Company, in exchange for a new bill with terms that conforms to the Company’s payment policy of net 90 days.

These solutions generally involve entering into exchange agreements with intermediary institutions who will make payments to the supplier or vendor within the original terms on behalf of the Company, in exchange for a new bill with terms that conforms to the Company’s payment policy of net 90 days.

The Company will then pay the new bill to the intermediary institutions, inclusive of any embedded premium, which the Company records as “Interest expense, net,” within three months or less.

During the three and nine months ended September 30, 2024, the Company borrowed $ 82.5 million and $ 184.8 million, respectively, under these deferred payable arrangements and during the three and nine months ended September 30, 2024 repaid $ 61.7 million and $ 103.1 million, respectively.

Amounts outstanding under these deferred payable arrangements were $ 84.1 million as of September 30, 2024 and are included in “Accrued and other current liabilities” on the condensed consolidated balance sheets.

For the three and nine months ended September 30, 2024, the Company incurred $ 1.7 million and $ 3.9 million of interest expense, respectively, under these arrangements.

These arrangements were not utilized by the Company during the three and nine months ended September 30, 2023.

Amounts outstanding under these deferred payable arrangements were $ 97.2 million and $ 72.8 million as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), respectively, and are included in “Accrued and other current liabilities” on the condensed consolidated balance sheets.

For the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) the Company borrowed $ 13.9 million, $ 79.6 million, and $ 41.9 million, respectively, under these deferred payable arrangements.

For the period from February 8, 2025 to March 31, 2025 (Successor) and the period from January 1, 2025 to February 7, 2025 (Predecessor) the Company repaid $ 5.0 million and $ 68.5 million, respectively, under these arrangements.

There were no repayments during the three months ended March 31, 2024 (Predecessor).

For the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) the Company incurred $ 1.6 million, $ 0.5 million and $ 0.8 million, respectively, of interest expense under these arrangements.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Gaming Expenses

Gaming expenses include, among other things, payroll costs and expenses associated with the operation of VLTs, slots and table games, including gaming taxes payable to jurisdictions in which the Company operates outside of Rhode Island and Delaware, and marketing costs directly associated with the Company’s iGaming products and services.

These marketing expenses are included within Gaming expenses in the condensed consolidated statements of operations and were $ 39.4 million and $ 43.6 million for the three months ended September 30, 2024 and 2023, respectively, and $ 132.6 million and $ 137.3 million for the nine months ended September 30, 2024 and 2023, respectively.

Gaming expenses include, among other things, payroll costs and expenses associated with the operation of VLTs, slots and table games, including gaming taxes payable to jurisdictions in which the Company operates outside of Rhode Island and Delaware, and certain marketing costs directly associated with the Company’s iGaming products and services.

Gaming expenses also include racing expenses comprised of payroll costs, off track betting (“OTB”) commissions and other expenses associated with the operation of live racing and simulcasting.

1 unchanged sentence

The Company expenses advertising costs as incurred.

For the three months ended September 30, 2024 and 2023, advertising expense was $ 3.5 million and $ 5.6 million, respectively, and for the nine months ended September 30, 2024 and 2023, advertising expense was $ 13.2 million and $ 14.2 million, respectively.

Advertising costs are included in “General and administrative” on the condensed consolidated statements of operations.

Advertising expenses, including production and agency fees of campaigns, for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) was $ 1.4 million, $ 0.9 million and $ 5.6 million, respectively, and are included in “General and administrative” on the condensed consolidated statements of operations.

Additionally, the Company incurred certain advertising and marketing costs directly associated with the Company’s iGaming products and services of $ 18.1 million, $ 12.6 million and $ 46.2 million during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor), respectively.

These costs are included within Gaming expenses in the condensed consolidated statements of operations.

Share-Based Compensation

The Company recognized total share-based compensation expense of $ 4.1 million and $ 6.3 million for the three months ended September 30, 2024 and 2023, respectively, and $ 11.6 million and $ 18.6 million for the nine months ended September 30, 2024 and 2023, respectively.

The total income tax benefit for share-based compensation arrangements was $ 1.1 million and $ 1.7 million for the three months ended September 30, 2024 and 2023, respectively, and $ 3.0 million and $ 4.9 million for the nine months ended September 30, 2024 and 2023, respectively.

The Company recognized total share-based compensation expense of $ 2.7 million, $ 2.0 million and $ 3.1 million for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

The total income tax benefit for share-based compensation arrangements was $ 0.7 million, $ 0.5 million and $ 0.8 million for the period from February 8, 2025 to March 31, 2025 (Successor), period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor), respectively.

Strategic Partnership - Sinclair Broadcast Group

In 2020, the Company and Sinclair Broadcast Group, Inc.

(“Sinclair”) entered into a Framework Agreement (the “Framework Agreement”), which provides for a long-term strategic relationship between Sinclair and the Company.

Under the Framework Agreement, the Company issued warrants and options and agreed to share tax benefits and received naming, integration and other rights, including access to Sinclair’s Tennis Channel, Stadium Sports Network and STIRR streaming service.

Under a Commercial Agreement (the “Commercial Agreement”) contemplated by the Framework Agreement, the Company paid annual fees to Diamond Sports Group (“Diamond”), a Sinclair subsidiary, for naming rights over Diamond’s regional sports networks (“RSNs”) and other consideration.

(“Sinclair”) entered into the Framework Agreement, providing for a long-term strategic relationship between Sinclair and the Company.

Under the Framework Agreement, the Company issued to Sinclair warrants to purchase up to 4,915,726 shares of the Company at an exercise price of $ 0.01 per share (“the Penny Warrants”), a warrant to purchase up to 3,279,337 shares of the Company at an exercise price of $ 0.01 per share, subject to the achievement of various performance metrics (the “Performance Warrants”), and an option to purchase up to 1,639,669 additional shares, in four tranches with purchase prices ranging from $ 30.00 to $ 45.00 per share, exercisable over a seven-year period beginning in November 2024 (the “Options”).

Additionally, the Company is required to share 60 % of the tax benefits it realizes from the Penny Warrants, Options, Performance Warrants and other related payments.

Changes in the estimate of the tax benefit to be realized and tax rates in effect at the time, among other changes, was treated as an adjustment to the intangible asset.

In connection with the Queen merger, as of February 7, 2025, all outstanding Performance Warrants became immediately exercisable at a price of $ 0.01 per share and the Options were returned to the Company in exchange for 384,536 penny warrants.

The Performance Warrants were reclassified from liability to equity as of February 7, 2025.

Refer to Note 12 “Fair Value Measurements” for more information.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The Company accounted for this relationship as an asset acquisition in accordance with the “Acquisition of Assets Rather Than a Business” subsections of ASC 805-50, Business Combinations—Related Issues , using a cost accumulation model.

The total intangible asset (“Commercial rights intangible asset”) represents the present value of the naming rights fees and other consideration, including the fair value of the warrants and options, and an estimate of the tax-sharing payments, each explained below.

The Commercial rights intangible asset, net of accumulated amortization, was $ 202.6 million and $ 225.9 million as of September 30, 2024 and December 31, 2023, respectively.

Amortization was $ 7.8 million and $ 7.7 million for the three months ended September 30, 2024 and 2023, respectively, and $ 23.4 million and $ 23.2 million for the nine months ended September 30, 2024 and 2023, respectively.

Refer to Note 9 “ Goodwill and Intangible Assets ” for further information.

The present value of the naming rights fees was recorded as part of intangible assets, with a corresponding liability, which was accreted through interest expense.

As of December 31, 2023, the total value of the liability was $ 57.7 million, with $ 8.0 million recorded within “Accrued and other current liabilities” related to the short-term portion of the liability, and $ 49.7 million related to the long-term portion of the liability reflected as “Commercial rights liability” in the condensed consolidated balance sheets.

Accretion expense reported in “Interest expense, net” in our condensed consolidated statements of operations was $ 1.1 million and $ 3.3 million for the three and nine months ended September 30, 2023, respectively.

In the first quarter of 2024, the Company’s obligation to pay Diamond for the naming rights terminated upon the bankruptcy court’s approval of certain settlement terms, which the court approved on March 1, 2024.

Refer to Note 17 “ Commitments and Contingencies ” for further information.

Under the Framework Agreement, the Company issued to SBG (i) an immediately exercisable warrant to purchase up to 4,915,726 shares of the Company at an exercise price of $ 0.01 per share (“the Penny Warrants”), (ii) a warrant to purchase up to a maximum of 3,279,337 additional shares of the Company at a price of $ 0.01 per share subject to the achievement of various performance metrics (the “Performance Warrants”), and (iii) an option to purchase up to 1,639,669 additional shares in four tranches with purchase prices ranging from $ 30.00 to $ 45.00 per share, exercisable over a seven-year period beginning on the fourth anniversary of the November 18, 2020 closing (the “Options”).

The exercise and purchase prices and the number of shares issuable upon exercise of the warrants and options are subject to customary anti-dilution adjustments.

Refer to Note 1 “ General Information ” for further information.

The Penny Warrants and Options are equity classified instruments under ASC 815, Derivatives and Hedging (“ASC 815”).

The fair value of the Penny Warrants approximates the fair value of the underlying shares and was $ 150.4 million on November 18, 2020 at issuance, and was recorded to “Additional paid-in-capital” in the condensed consolidated balance sheets, with an offset to the Commercial rights intangible asset.

The Performance Warrants are accounted for as a derivative liability because the underlying performance metrics represent an adjustment to the settlement amount that is not indexed to the Company’s own stock and thus equity classification is precluded under ASC 815.

Refer to Note 11 “ Fair Value Measurements ” for further information.

Under the Framework Agreement, the Company agreed to share 60 % of the tax benefits it realizes from the Penny Warrants, Options, Performance Warrants and other related payments.

Changes in the estimate of the tax benefit to be realized and tax rates in effect at the time, among other changes, are treated as an adjustment to the intangible asset.

The liability for these obligations was $ 18.8 million and $ 19.1 million as of September 30, 2024 and December 31, 2023, respectively, and is reflected in “Commercial rights liabilities” within our condensed consolidated balance sheets.

Provision for Income Taxes

During the nine months ended September 30, 2024 and 2023, the Company recorded a benefit for income tax of $ 3.7 million, at an effective year to date tax rate of 0.8 % and a provision for income tax of $ 153.0 million, at an effective year to date tax rate of 62.7 %, respectively.

The 2024 year to date effective tax rate differed from the US federal statutory tax rate of 21%, creating a benefit for income tax on the Company’s Loss before income taxes, largely due to an increase in the valuation allowance, entirely offset by discrete tax asset related to the sale-leaseback transaction involving the real estate underlying the Bally’s Chicago project.

The 2023 year to date effective tax rate was higher than the US federal statutory tax rate of 21%, largely due to an increase in the valuation allowance and a tax liability for a discrete item related to the deferred gain on sale-leaseback transactions in Mississippi and Rhode Island.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

During the period from February 8, 2025 to March 31, 2025 (Successor), the Company recorded a benefit for income tax of $ 97.1 million, and a provision for income tax of $ 0.7 million, and $ 31.4 million during the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor), respectively.

The effective tax rate for period from February 8, 2025 to March 31, 2025 (Successor), period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) was 155.2 %, ( 1.3 )%, and 22.0 %, respectively.

As of March 31, 2025 (Successor), the Company projects an annual tax provision relative to its pre-tax loss in the US due to the valuation allowance on interest, and a tax provision internationally relative to its pre-tax income, which results in a combined 204 % annual effective tax rate, as the combined pre-tax income by jurisdiction is minimized.

RELATED PARTY TRANSACTIONS

The Company holds a warrant, representing a 19.99 % fully diluted equity interest in the Carved-Out Business, which as a result is an unconsolidated entity accounted for under the equity method and is considered to be a related party under ASC 850.

Revenues generated from this equity method investee are included in “Non-gaming revenue” and were $ 3.7 million and $ 4.9 million for the period from February 8, 2025 to March 31, 2025 (Successor) and period from January 1, 2025 to February 7, 2025 (Predecessor), respectively.

There was no revenue generated from this equity method investee during the three months ended March 31, 2024 (Predecessor).

Receivables from this equity method investee are included in Accounts receivable, net and were $ 3.3 million and $ 1.1 million as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), respectively.

In connection with the disposal of the Carved-Out Business, the Company entered into a seven-year term loan with the Buyer for a principal amount of € 30 million, subject to applicable interest.

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), the Company had a loan receivable of approximately $ 29.3 million and $ 31.2 million, respectively, included in Other assets within the condensed consolidated balance sheets, and recorded interest income of $ 0.5 million and $ 0.3 million, respectively, for the period from February 8, 2025 to March 31, 2025 (Successor) and the period from January 1, 2025 to February 7, 2025 (Predecessor), included within Interest expense, net in the condensed consolidated statements of operations.

CONSOLIDATED FINANCIAL INFORMATION

General and Administrative Expense

Amounts included in General and administrative for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

Amounts included in General and administrative for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) were as follows:

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Advertising, general and administrative $ 140,416 $ 100,969 $ 224,201

Acquisition and integration 4,100 2,199 4,852

Merger costs 15,875 11,233 770

Restructuring charges, net — — 18,613

Impairment charges (1)

— — 12,757 9,653

Total general and administrative $ 160,391 $ 114,401 $ 248,436

__________________________________

(1) Includes impairment charges on long-lived assets within the International Interactive segment in the second quarter of 2024 and impairment charges related to assets held-for-sale within the North America Interactive segment in 2023.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Other Non-Operating (Expense) Income, Net

Amounts included in Other non-operating (expense) income, net for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

Change in value of commercial rights liabilities $ ( 16,932 ) $ 4,676 $ ( 10,615 ) $ 11,967

Net (loss) income from equity method investments ( 1,073 ) 2,254 ( 284 ) 5,344

Gain on extinguishment of debt — — — 4,044

Foreign exchange (loss) gain ( 30,246 ) 8,459 ( 26,447 ) 2,512

Amounts included in Other non-operating income (expense), net for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor) were as follows:

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Loss on extinguishment of debt $ ( 17,372 ) $ — $ —

Change in value of performance warrants — ( 1,180 ) —

Gain on fair value of equity method investment 5,544 — —

Net income (loss) from equity method investments 863 ( 594 ) 555

Foreign exchange gain 1,591 194 2,816

Other, net 344 ( 785 ) 1,183

Total other non-operating (expense) income, net $ ( 49,854 ) $ 15,528 $ ( 38,370 ) $ 24,949

Total other non-operating income (expense), net $ ( 9,030 ) $ ( 2,365 ) $ 4,554

Interest Expense, Net

Amounts included in interest expense, net, for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor) were as follows:

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Interest income $ 1,450 $ ( 1 ) $ 4,795

Interest expense ( 53,187 ) ( 27,228 ) ( 77,926 )

Total interest expense, net $ ( 51,737 ) $ ( 27,229 ) $ ( 73,131 )

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Standards to Be Implemented

In October 2023, the FASB issued ASU No.

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative .

4 unchanged sentences

The Company is currently in the process of evaluating the impact of this amendment on its condensed consolidated financial statements and related disclosures.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures .

The amendments in this update enhance the disclosures required for significant segment expenses on an annual and interim basis.

The guidance will apply retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal years beginning after December 31, 2024.

The Company is currently in the process of evaluating the impact of this amendment on its condensed consolidated financial statements and related disclosures.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

In December 2023, the FASB issued ASU No.

3 unchanged sentences

The Company is currently in the process of evaluating the impact of this amendment on its condensed consolidated financial statements and related disclosures.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

In March 2024, the FASB issued ASU 2024-02, Codification Improvements - Amendments to Remove References to the Concepts Statements .

2 unchanged sentences

The Company is currently in the process of evaluating the impact of this amendment on its condensed consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses .

The amendments in this update require disclosure of certain costs and expenses on an interim and annual basis in the notes to the financial statements.

This update will be effective for fiscal years beginning after December 15, 2026, and interim reporting periods in fiscal years beginning after December 15, 2027, with early adoption permitted.

The disclosures required under the guidance can be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all periods presented in the financial statements.

The Company is currently evaluating the impact that this guidance will have on its financial statement disclosures.

REVENUE RECOGNITION

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Racing revenue includes several of our casinos and resorts’ share of wagering from live racing and the import of simulcast signals, and is recognized upon completion of the wager based upon an established take-out percentage.

The estimated retail value related to goods and services provided to customers without charge or upon redemption under the Company’s player loyalty programs included in departmental revenues, and therefore reducing gaming revenues, are as follows for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

The estimated retail value related to goods and services provided to customers without charge or upon redemption under the Company’s player loyalty programs included in departmental revenues, and therefore reducing gaming revenues, are as follows for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor):

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Hotel $ 10,796 $ 7,098 $ 20,479

18 unchanged sentences

The following tables provide a disaggregation of revenue by segment (in thousands):

Three Months Ended September 30, 2024 Casinos & Resorts International Interactive North America Interactive Total

Gaming $ 256,234 $ 228,693 $ 38,979 $ 523,906

Hotel 41,672 — — 41,672

Food and beverage 35,403 — — 35,403

Retail, entertainment and other 20,049 2,244 6,700 28,993

Total non-gaming revenue 97,124 2,244 6,700 106,068

Total revenue $ 353,358 $ 230,937 $ 45,679 $ 629,974

Three Months Ended September 30, 2023

Period from February 8, 2025 to March 31, 2025 (Successor) Casinos & Resorts International Interactive North America Interactive Corporate & Other Total

Gaming $ 178,534 $ 107,736 $ 27,509 $ — $ 313,779

1 unchanged sentence

Food and beverage 20,254 — — — 20,254

Licensing — 4,883 — — 4,883

Retail, entertainment and other 9,350 131 48 1,536 11,065

1 unchanged sentence

Total revenue $ 226,851 $ 112,750 $ 27,557 $ 1,536 $ 368,694

Nine Months Ended September 30, 2024

Period from January 1, 2025 to February 7, 2025 (Predecessor)

Gaming $ 95,984 $ 74,849 $ 14,934 $ — $ 185,767

1 unchanged sentence

Food and beverage 11,304 — — — 11,304

Licensing — 3,720 — — 3,720

Retail, entertainment and other 6,005 416 2,007 273 8,701

1 unchanged sentence

Total revenue $ 124,299 $ 78,985 $ 16,941 $ 273 $ 220,498

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024 (Predecessor)

Gaming $ 250,418 $ 231,267 $ 34,372 $ — $ 516,057

1 unchanged sentence

Food and beverage 34,952 — — — 34,952

Licensing — — — — —

Retail, entertainment and other 15,869 3,416 5,195 1,903 26,383

3 unchanged sentences

The Company’s receivables related to contracts with customers are primarily comprised of marker balances, interactive platform business-to-business service receivables, other amounts due from gaming activities, amounts due for hotel stays and amounts due from tracks and OTB locations.

The Company’s receivables related to contracts with customers were $ 30.8 million and $ 38.5 million as of September 30, 2024 and December 31, 2023, respectively.

The Company’s receivables related to contracts with customers were $ 38.8 million and $ 41.3 million as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), respectively.

The Company has the following liabilities related to contracts with customers:

9 unchanged sentences

Unpaid wagers include the Company’s outstanding chip liability and unpaid slot, pari-mutuel and sports betting tickets.

Liabilities related to contracts with customers as of September 30, 2024 and December 31, 2023 were as follows:

September 30, December 31,

Liabilities related to contracts with customers as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor) were as follows:

Successor Predecessor

March 31, December 31,

(in thousands) 2025 2024

3 unchanged sentences

Total $ 71,198 $ 71,300

The Company recognized $ 7.1 million and $ 10.0 million of revenue related to loyalty program redemptions for the three months ended September 30, 2024 and 2023, respectively, and $ 22.6 million and $ 27.7 million of revenue related to loyalty program redemptions for the nine months ended September 30, 2024 and 2023, respectively.

The Company recognized $ 3.2 million, $ 2.2 million and $ 7.6 million of revenue related to loyalty program redemptions for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

BUSINESS COMBINATIONS

Casinos & Resorts Acquisitions

Bally’s Golf Links - On September 12, 2023, the Company completed the acquisition of Trump Golf Links at Ferry Point, subsequently renamed Bally’s Golf Links at Ferry Point, which includes the assignment of a license agreement to operate an 18-hole links-style golf course located in the Bronx, New York.

The total purchase consideration included cash paid, net of cash acquired and net working capital adjustments, which amounted to $ 55.0 million.

This acquisition continues the Company’s strategic objective of developing a diversified portfolio within its Casinos & Resorts segment.

Total purchase consideration also includes contingent consideration valued at $ 58.6 million, which is the fair value, under GAAP, of expected cash payments totaling up to $ 125 million to the seller, based upon future events, which are uncertain.

The contingent consideration was recorded at fair value, using discounted cash flow analyses with level 3 inputs, and is remeasured quarterly, with fair value adjustments recognized in earnings, until the contingencies are resolved.

Inputs to this valuation approach include the Company’s estimated probabilities of achieving the conditions for payment, expected terms between 1.5 and 3 Years, and discount rates between 7.2 % and 7.8 %.

The settlement of the contingent consideration liabilities will be due to the seller in the event the license agreement is extended or if the Company is successful in its bid for a casino license.

Merger with Queen Casino & Entertainment, Inc.

The Merger between the Company and Queen was accounted for as a transaction between entities under common control in accordance with ASC Topic 805, Business Combinations (“ASC 805”), in which the accounting acquirer (Parent and its affiliates) obtained control of the Company.

As described in Note 2, “Summary of Significant Accounting Policies”, the Company has elected to push down its Parent’s basis in its net assets into its financial statements, and as a result, the net assets of the Predecessor will be measured and recognized at their fair values as of the acquisition date and will be combined with those of Queen at Queen’s historical carrying amounts and will be presented on a combined basis.

The following disclosures relate to the Company’s election to apply push down and show the effect of the change in control.

The fair value of the Merger consideration was $ 955.6 million, which represents the total number of shares outstanding prior to the Merger multiplied by the Merger value of $ 18.25 per share.

Immediately following the transaction, the Company repurchased 22.8 million shares at a price of $ 18.25 for total a total repurchase price of $ 416.2 million.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The following table summarizes the consideration paid and the fair values of the assets acquired and liabilities assumed in connection with the Casinos & Resorts acquisition as of September 30, 2024:

Bally’s Golf Links

(in thousands) Final (2)

Total current assets $ 1,108

Property and equipment, net 505

Intangible assets, net (1)

Other assets 2,000

Goodwill 103,824

Total current liabilities ( 345 )

Total purchase price $ 113,592

__________________________________

(1) Bally’s Golf Links’ intangible assets include a concessionaire license of $ 6.5 million, which is being amortized over its estimated useful life of approximately 12 years.

(2) The Company recorded adjustments to the preliminary purchase price allocation during the nine months ended September 30, 2024 which decreased Goodwill and the total purchase price by $ 0.2 million.

Goodwill recognized is deductible for local tax purposes and has been assigned as of the acquisition date to the Company’s Casinos & Resorts reportable segment, which includes the reporting unit expected to benefit from the synergies of the acquisitions.

Qualitative factors that contribute to the recognition of goodwill include expected synergies from integrating the business into the Company’s casino portfolio and future development of its omni-channel strategy.

The Company incurred $ 0.2 million of acquisition costs related to the above Casinos & Resorts acquisition during the nine months ended September 30, 2024 and $ 0.5 million during the three and nine months ended September 30, 2023.

These costs are included within “General and administrative” of the condensed consolidated statements of operations.

International Interactive Acquisition

Casino Secret - On January 5, 2023, the Company completed the acquisition of BACA Limited (“Casino Secret”), a European based online casino that offers slots, tables and live dealer games to Asian markets for total consideration of $ 50.4 million.

Cash paid by the Company, net of $ 8.3 million cash acquired, was $ 38.7 million, excluding transaction costs.

The following table summarizes the consideration paid and the fair values of the assets acquired and liabilities assumed in connection with the International Interactive acquisition:

(in thousands) Casino Secret

Total current assets $ 8,862

Property and equipment, net 50

Intangible assets, net (1)

The preliminary allocation of the purchase price is as follows:

(in thousands) February 7, 2025

Cash and cash equivalents $ 173,550

Restricted cash 57,352

Other current assets 210,447

Property and equipment 1,065,486

Right of use assets 1,692,346

Goodwill 1,555,354

Intangible assets 1,866,963

Other assets 131,457

Total current liabilities ( 548,702 )

Total purchase price $ 50,434

__________________________________

(1) Casino Secret intangible assets include player relationships and trade names of $ 26.0 million and $ 3.5 million, respectively, which are both being amortized on a straight-line basis over their estimated useful lives of approximately 7 years.

(2) The Company did not record adjustments to the preliminary purchase price allocation during the nine months ended September 30, 2024.

Total goodwill recorded in connection with the above acquisition was $ 18.4 million, and is not deductible for local tax purposes.

Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets apart from goodwill, which consist primarily of benefits from acquiring a talented technology workforce and management team experienced in the online gaming industry, and securing buyer-specific synergies expected to contribute to the Company’s omni-channel strategy which are expected to increase revenue and profits within the Company’s International Interactive reportable segment.

The goodwill of the acquisition has been assigned, as of the acquisition date, to the Company’s International Interactive reportable segment.

Lease liabilities ( 1,823,153 )

Long-term debt ( 2,914,688 )

Other long-term liabilities ( 510,765 )

Net assets acquired $ 955,647

The purchase consideration has been allocated to the tangible and identifiable intangible assets and liabilities based upon their estimated fair values as of the acquisition date, with the excess of the purchase consideration over the aggregate net fair values recorded as goodwill, which is not deductible for tax purposes.

Accounts receivable, other assets, current liabilities and inventories were stated at their historical carrying value, which approximates fair value given the short-term nature of these assets and liabilities.

The estimate of fair value for property and equipment and owned real property was based on an assessment of the assets' condition as well as an evaluation of the current market value of such assets.

The fair value of leasehold interests were estimated based on evaluating contractual rent payments relative to market rent giving consideration to the Company’s capitalization rates and rent coverage ratios, under the income method or by estimating the fee simple value and estimated rate of return, depending on the nature of the underlying leasehold interest.

The estimated fair values were based on assumptions that the Company believes are reasonable.

As of March 31, 2025 (Successor), the Company is in the process of completing its valuation of tangible and intangible assets and the allocation of the purchase price to the assets acquired and liabilities assumed, including the goodwill allocation to reporting units, which will be completed once the valuation process has been finalized.

The Company recorded intangible assets based on estimates of fair value which consisted of the following:

Valuation Approach Estimated Useful Life

(in years) Estimated Fair Value

Gaming licenses Greenfield Method 16 $ 759,383

Customer relationships Multi-period Excess earnings method 4 357,180

Developed technology Relief from royalty method 5 253,200

Trade names Relief from royalty method 12 74,700

Intellectual property license Relief from royalty method 7 141,000

Trade names and other Relief from royalty method Indefinite 281,500

Total fair value of intangible assets $ 1,866,963

The valuation of intangible assets was determined using income approach methodologies including the greenfield method, multi-period excess earnings method and the relief from royalty method.

Level 3 inputs used in estimating future cash flows included terminal growth rates of 3 %, royalty rates between 2 % and 19 %, discount rates between 11 % and 15 %, operating cash flows, estimated construction costs, and pre-opening expenses, among others.

The projected future cash flows are discounted to present value using an appropriate discount rate.

As of March 31, 2025 (Successor), the Company is in the process of completing its valuation of intangible assets and the allocation of the purchase price to net assets, which will be completed once the valuation process has been finalized.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The Company incurred $ 1.2 million of acquisition costs related to the above International Interactive acquisition during the nine months ended September 30, 2023.

There were no acquisition costs related to the International Interactive acquisition during the three months ended September 30, 2023 or three and nine months ended September 30, 2024.

These costs are included within “General and administrative” of the condensed consolidated statements of operations.

The Company incurred $ 15.9 million, $ 11.2 million and $ 0.8 million of transaction-related expenses for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor), respectively.

Transaction-related expenses were incurred in connection with the Merger and are primarily related to legal and professional fees, which have been included in General and administrative in the condensed consolidated statements of operations.

PREPAID EXPENSES AND OTHER CURRENT ASSETS

As of September 30, 2024 and December 31, 2023, prepaid expenses and other current assets was comprised of the following:

September 30, December 31,

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), prepaid expenses and other current assets was comprised of the following:

Successor Predecessor

March 31, December 31,

(in thousands) 2025 2024

Short term notes receivable $ 16,221 $ 17,342

Services and license agreements 51,012 43,141

Gaming taxes and licenses 14,216 9,309

Prepaid marketing 12,306 8,685

Purse funds 9,416 6,404

Loan receivable 38,599 —

Sales tax 18,261 18,988

Due from payment service providers 6,069 12,662

Prepaid marketing 12,328 11,952

Short term derivative assets 4,999 5,359

3 unchanged sentences

PROPERTY AND EQUIPMENT

As of September 30, 2024 and December 31, 2023, property and equipment was comprised of the following:

September 30, December 31,

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), property and equipment was comprised of the following:

Successor Predecessor

March 31, December 31,

(in thousands) 2025 2024

7 unchanged sentences

Property and equipment, net $ 1,136,623 $ 630,702

Depreciation expense relating to property and equipment was $ 19.3 million and $ 20.2 million for the three months ended September 30, 2024 and 2023, respectively, and $ 138.6 million and $ 57.8 million for the nine months ended September 30, 2024 and 2023, respectively.

Depreciation expense during the nine months ended September 30, 2024 included $ 80.1 million of accelerated depreciation related to the closure of the Tropicana Las Vegas property on April 2, 2024.

Refer to Note 13 “ Restructuring Expense ” for further information.

The Company recorded capitalized interest of $ 1.9 million and $2.9 million during the three months ended September 30, 2024 and 2023, respectively, and $ 5.9 million and $ 7.9 million during the nine months ended September 30, 2024 and 2023, respectively.

Depreciation expense relating to property and equipment was $ 14.5 million, $ 7.6 million and $ 99.5 million for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

Depreciation expense during the three months ended March 31, 2024 (Predecessor) included $ 80.1 million of accelerated depreciation related to the closure of the Tropicana Las Vegas property on April 2, 2024.

Refer to Note 13 “ Restructuring Ex pense ” for further information.

The Company recorded capitalized interest of $ 1.7 million, $ 0.8 million and $ 1.8 million during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Bally’s Chicago

A wholly-owned indirect subsidiary of the Company, Bally’s Chicago Operating Company, LLC entered into a Lease Termination and Short Term License Agreement with Chicago Tribune Company, LLC (“Tribune”), effective March 31, 2023, which, among other things, provided that the Company will have possession of 777 West Chicago Avenue, Chicago, Illinois 60610 on or before July 5, 2024, subject to $ 150 million in payments by the Company to Tribune payable in full upon Tribune vacating the site on or prior to July 5, 2024 (the “Payment”).

$ 10 million of the Payment was paid upon execution of the Lease Termination and Short Term License Agreement and $ 90 million of the Payment was paid during the third quarter of 2023.

The Company paid the remaining $ 50 million on July 9, 2024 and gained possession of the property per the agreement with Tribune.

In the third quarter of 2024, as the result of a lease modification event, the Company derecognized $ 350.0 million of land relating to the site of the future Bally’s Chicago permanent facility.

Refer to Note 15 “ Leases ” for further information.

GOODWILL AND INTANGIBLE ASSETS

The change in intangible assets, net for the nine months ended September 30, 2024 is as follows (in thousands):

Intangible assets, net as of December 31, 2023

The change in carrying value of goodwill by reportable segment for the three months ended March 31, 2025 (Successor) is as follows (in thousands):

Casinos & Resorts International Interactive North America Interactive Corporate & Other Total

Goodwill as of December 31, 2024 (Predecessor) (1)

$ 313,285 $ 1,451,273 $ 35,386 $ — $ 1,799,944

Effect of foreign exchange — ( 11,268 ) — — ( 11,268 )

Goodwill as of February 7, 2025 (Predecessor) (1)

313,285 1,440,005 35,386 — $ 1,788,676

Goodwill as of February 8, 2025 (Successor) 612,191 716,260 56,845 205,352 $ 1,590,648

Effect of foreign exchange — 31,063 — 31,063

Goodwill as of March 31, 2025 (Successor)

$ 612,191 $ 747,323 $ 56,845 $ 205,352 $ 1,621,711

__________________________________

(1) Amounts are shown net of accumulated goodwill impairment charges of $ 5.4 million and $ 140.4 million for Casinos & Resorts and North America Interactive, respectively.

The change in intangible assets, net for the three months ended March 31, 2025 (Successor) is as follows (in thousands):

Intangible assets, net as of December 31, 2024 (Predecessor)

Effect of foreign exchange ( 3,662 )

Internally developed software 3,054

Other intangibles acquired 2,127

Amortization of intangible assets ( 14,765 )

Intangible assets, net as of September 30, 2024

Intangible assets, net as of February 07, 2025 (Predecessor) $ 1,291,970

Intangible assets, net as of February 08, 2025 (Successor) $ 1,941,245

Additions in current period 962

Effect of foreign exchange 32,740

Internally developed software 5,982

Amortization of intangible assets ( 32,936 )

Intangible assets, net as of March 31, 2025 (Successor)

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The Company’s identifiable intangible assets consist of the following:

September 30, 2024

March 31, 2025

(in thousands) Gross Carrying Amount Accumulated

1 unchanged sentence

Amortizable intangible assets:

Commercial rights - Sinclair (1)

$ 315,847 $ ( 113,275 ) $ 202,572

Trade names $ 79,464 $ ( 2,250 ) $ 77,214

Hard Rock license 8,000 ( 2,485 ) 5,515

Customer relationships 370,890 ( 15,261 ) 355,629

2 unchanged sentences

Gaming licenses 752,296 ( 7,362 ) 744,934

Licensing asset 147,138 ( 2,995 ) 144,143

Other 25,006 ( 4,037 ) 20,969

3 unchanged sentences

Trade names 281,500 — 281,500

Other 1,333 — 1,333

Total unamortizable intangible assets 342,601 — 342,601

Total intangible assets, net $ 1,987,556 $ ( 39,563 ) $ 1,947,993

__________________________________

(1) Commercial rights intangible asset in connection with the Framework Agreement.

Refer to Note 2 “ Summary of Significant Accounting Policies ” for further information.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

December 31, 2024

2 unchanged sentences

Amortizable intangible assets:

Commercial rights - Sinclair (2)

$ 315,847 $ ( 89,901 ) $ 225,946

Trade names $ 31,723 $ ( 18,032 ) $ 13,691

13 unchanged sentences

__________________________________

(2) See note (1) above.

Amortization of intangible assets was approximately $ 58.5 million and $ 57.3 million for the three months ended September 30, 2024 and 2023, respectively, and $ 177.8 million and $ 173.4 million for the nine months ended September 30, 2024 and 2023, respectively.

The following table reflects the remaining amortization expense associated with the finite-lived intangible assets as of September 30, 2024:

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Amortization of intangible assets was approximately $ 32.9 million, $ 14.8 million and $ 60.3 million for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

The following table reflects the remaining amortization expense associated with the finite-lived intangible assets as of March 31, 2025 (Successor):

(in thousands)

4 unchanged sentences

The Company utilizes derivative instruments in order to mitigate interest rate and currency exchange rate risk in accordance with its financial risk and liability management policy.

In 2023, the Company entered into a series of interest rate contracts and cross currency swap derivative transactions with multiple bank counterparties in order to synthetically convert a notional aggregate amount of $ 500.0 million of the Company’s USD denominated variable rate Term Loan Facility, as disclosed in Note 14 “ Long-Term Debt ,” into fixed rate debt over five years and $ 200 million of the Term Loan Facility, to an equivalent GBP denominated floating rate instrument over three years .

The Company has entered into a series of interest rate contracts and cross currency swap derivative transactions with multiple bank counterparties in order to synthetically convert a notional aggregate amount of $ 500.0 million of the Company’s USD denominated variable rate Term Loan Facility, as disclosed in Note 15 “ Long-Term Debt ,” into fixed rate debt over five years and $ 200 million of the Term Loan Facility, to an equivalent GBP denominated floating rate instrument over three years .

These contracts mature in October, 2028 and 2026, respectively.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

In the third quarter of 2024, the Company settled $ 500.0 million of notional interest rate collars and received $ 3.9 million in termination payments, reflecting the fair value on the settlement date.

The fair value on the settlement date is recorded as a component of accumulated other comprehensive income (loss), which will be reclassified into “Interest expense, net” in the condensed consolidated statements of operations in the same period in which the hedged interest payments associated with the Company’s borrowings are recorded.

Additionally, the Company simultaneously entered into a series of interest rate contracts in a notional aggregate amount of $ 1.00 billion, to further manage the Company’s exposure to interest rate movements associated with the Company’s variable rate Term Loan Facility through its synthetic conversion to fixed rate debt.

Additionally, the Company has entered into a series of interest rate contracts in a notional aggregate amount of $ 1.00 billion, to further manage the Company’s exposure to interest rate movements associated with the Company’s variable rate Term Loan Facility through its synthetic conversion to fixed rate debt.

The tenor of these contracts were matched with the maturity of the Term Loan Facility tranche maturing on October 1, 2028.

Derivative Instruments Designated as Hedging Instruments

Net Investment Hedges

Cross Currency Swaps - The Company is exposed to fluctuations in foreign exchange rates on investments it holds in its European foreign entities.

Cross Currency Swaps

Net Investment Hedges - The Company is exposed to fluctuations in foreign exchange rates on investments it holds in its European foreign entities.

The Company uses fixed and fixed-cross-currency swaps to hedge its exposure to changes in the foreign exchange rate on its foreign investment in Europe and their exposure to changes in the EUR-GBP exchange rate.

6 unchanged sentences

Refer to Note 12 “Fair Value Measurements” and Note 17 “Stockholders’ Equity” for further information.

The following tables summarize the Company’s net investment hedges as of September 30, 2024 and December 31, 2023 (in thousands):

Net Investment Hedges Notional Sold Notional Purchased

Cross currency swaps € 461,595 £ 387,531

Cross currency swaps £ 546,759 $ 700,000

Economic Hedges - During the fourth quarter of 2024, the Company dedesignated its EUR-GBP cross currency swaps as net investment hedges and began recording changes in fair value of the derivative and the accrual of foreign currency and USD denominated coupons through earnings reported in Other non-operating income (expense), net in the consolidated statements of operations.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The following tables summarize the Company’s cross currency swap arrangements as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor) (in thousands):

Hedge Designation Notional Sold Notional Purchased

Cross currency swaps Economic Hedges € 461,595 £ 387,531

Cross currency swaps Net Investment Hedge £ 546,759 $ 700,000

Cash Flow Hedges

4 unchanged sentences

Refer to Note 12 “Fair Value Measurements” and Note 17 “Stockholders’ Equity” for further information.

The following table summarizes the Company’s cash flow hedges as of September 30, 2024 and December 31, 2023 (in thousands):

September 30, 2024 December 31, 2023

Cash Flow Hedges Index Notional Amount Cap Floor Notional Amount Cap Floor (1)

The following table summarizes the Company’s cash flow hedges as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor) (in thousands):

Successor Predecessor

March 31, 2025 December 31, 2024

Cash Flow Hedges Index Notional Amount Notional Amount

Interest rate contracts - swaps US - SOFR $ 1,500,000 $ 1,500,000

Interest rate contracts - collars US - SOFR $ — — — $ 500,000 4.25 % 3.22 %

__________________________________

(1) Weighted average rate.

BALLY’S CORPORATION

3 unchanged sentences

Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

September 30, 2024

March 31, 2025

(in thousands) Balance Sheet Location Level 1 Level 2 Level 3

1 unchanged sentence

Restricted cash Restricted cash 54,955 — —

Convertible loans Other assets — — 4,321

Investments in equity securities Other assets 2,440 — —

Fair value option loan receivable Prepaid and other current assets — 38,599 —

Fair value option equity method investments Other assets 182,581 — —

Investment in GLPI partnership Other assets — 21,579 —

Derivative assets not designated as hedging instruments:

Cross currency swaps Prepaid expenses and other current assets — 4,859 —

Cross currency swaps Other assets — 108 —

Derivative assets designated as hedging instruments:

1 unchanged sentence

Interest rate contracts Other assets — 7,256 —

Cross currency swaps Prepaid expenses and other current assets — 5,066 —

Cross currency swaps Other assets — 3,906 —

Total derivative assets at fair value — 12,363 —

2 unchanged sentences

Derivative liabilities not designated as hedging instruments:

Sinclair Performance Warrants

Commercial rights liabilities — — 55,318

Cross Currency Swaps Other long-term liabilities — 12,169 —

Derivative liabilities designated as hedging instruments:

11 unchanged sentences

Restricted cash Restricted cash 60,021 — —

Convertible loans Other assets — — 4,115

Investments in equity securities Other assets 3,409 — —

Investment in GLPI partnership Other assets — 20,418 —

Derivative assets not designated as hedging instruments

Cross currency swaps Prepaid expenses and other current assets — 4,871 —

Cross currency swaps Other assets — 615 —

Derivative assets designated as hedging instruments:

Interest rate contracts Prepaid expenses and other current assets — 340 —

Interest rate contracts Other assets — 336 —

Cross currency swaps Prepaid expenses and other current assets — 148 —

4 unchanged sentences

Derivatives not designated as hedging instruments

Sinclair Performance Warrants Commercial rights liabilities — — 44,703

Sinclair Performance Warrants Other long-term liabilities — — 58,668

Cross currency swaps Other long-term liabilities — 11,174 —

Derivative liabilities designated as hedging instruments:

Interest rate contracts Accrued and other current liabilities — 1,855 —

Interest rate contracts Other long-term liabilities — 13,372 —

3 unchanged sentences

Total liabilities $ — $ 29,214 $ 118,591

The following tables summarize the changes in fair value of the Company’s Level 3 assets and liabilities:

(in thousands) Sinclair Performance Warrants Contingent Consideration Convertible Loans

Beginning as of December 31, 2023

$ 44,703 $ 58,580 $ 4,115

Change in fair value — ( 1,835 ) ( 33 )

Ending as of March 31, 2024

The following tables summarize the changes in fair value of the Company’s Level 3 liabilities:

(in thousands) Sinclair Performance Warrants Contingent Consideration

Beginning as of December 31, 2024 (Predecessor)

$ 58,668 $ 59,923

Change in fair value 1,180 786

Ending as of June 30, 2024

$ 38,386 $ 57,785 $ 4,086

Ending as of February 7, 2025 (Predecessor) $ 59,848 $ 60,709

Beginning as of February 8, 2025 (Successor) — 60,709

Change in fair value — —

Ending as of September 30, 2024

$ 55,318 $ 58,844 $ 4,321

Ending as of March 31, 2025 (Successor)

BALLY’S CORPORATION

1 unchanged sentence

(in thousands) Sinclair Performance Warrants Contingent Consideration Convertible Loans

Beginning as of December 31, 2022

$ 36,987 $ 8,220 $ 10,212

Additions in the period (acquisition fair value) — — 500

Change in fair value 267 1,241 126

Ending as of March 31, 2023

$ 37,254 $ 9,461 $ 10,838

Additions in the period (acquisition fair value) — — 500

Reductions in the period — ( 9,292 ) —

Change in fair value ( 7,558 ) ( 169 ) 136

Ending as of June 30, 2023

Beginning as of December 31, 2023 (Predecessor)

$ 44,703 $ 58,580 $ 4,115

Additions in the period (acquisition fair value) — 58,580 500

Change in fair value — ( 1,835 ) ( 33 )

Ending as of September 30, 2023

Ending as of March 31, 2024 (Predecessor)

$ 44,703 $ 56,745 $ 4,082

The gains (losses) recognized in the condensed consolidated statements of operations for derivative instruments during the three and nine months ended September 30, 2024 and 2023 are as follows:

Condensed Consolidated Statements of Operations Location Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

The gains (losses) recognized in the condensed consolidated statements of operations for derivative instruments during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor) are as follows:

Condensed Consolidated Statements of Operations Location Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Derivatives not designated as hedging instruments

Sinclair Performance Warrants Other non-operating (expense) income, net $ ( 16,932 ) $ 4,676 $ ( 10,615 ) $ 11,967

Sinclair Performance Warrants Other non-operating income (expense), net $ — $ ( 1,180 ) $ —

Cross Currency Swaps Other non-operating income (expense), net 221 50 —

Derivatives designated as hedging instruments

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These standard pricing models utilize inputs that are derived from or corroborated by observable market data such as interest rate yield curves as well as currency spot and forward rates.

Changes in the fair value of these contracts are reported as a component of other comprehensive income (loss).

When designated as hedging instruments, changes in the fair value of these contracts are reported as a component of other comprehensive income (loss).

When not designated as hedging instruments, changes in fair value of these contracts are reported within Other non-operating income (expense), net in the consolidated statements of operations.

Sinclair Performance Warrants

Sinclair Performance Warrants are accounted for as a derivative instrument classified as a liability within Level 3 of the hierarchy as the warrants are not traded in active markets and are subject to certain assumptions and estimates made by management related to the probability of meeting performance milestones.

Sinclair Performance Warrants were accounted for as a derivative instrument classified as a liability within Level 3 of the hierarchy through February 7, 2024 (predecessor) as the warrants are not traded in active markets and are subject to certain assumptions and estimates made by management related to the probability of meeting performance milestones.

These assumptions and the probability of meeting performance targets may have a significant impact on the value of the warrant.

The Performance Warrants are valued using an option pricing model, considering the Company’s estimated probabilities of achieving the performance milestones for each tranche.

The Performance Warrants were valued using an option pricing model, considering the Company’s estimated probabilities of achieving the performance milestones for each tranche.

Inputs to this valuation approach include volatility between 40 % and 67 %, risk free rates between 3.84 % and 4.79 %, the Company’s common stock price for each period and expected terms between 1.5 and 6.3 years.

The fair value is recorded within “Commercial rights liabilities” of the condensed consolidated balance sheets.

In connection with the Queen merger, as of February 7, 2025, all outstanding Performance Warrants became immediately exercisable at a price of $0.01 per share and were reclassified out of liabilities and into equity and are no longer measured at fair value.

The fair value is recorded within Other long-term liabilities of the condensed consolidated balance sheets as of December 31, 2024 (predecessor).

BALLY’S CORPORATION

3 unchanged sentences

The remeasurements are based primarily on the expected probability of achievement of the contingency targets which are subject to management’s estimates.

These changes in fair value are recognized within “Other non-operating (expense) income, net” of the condensed consolidated statements of operations.

In connection with the acquisitions of SportCaller and Monkey Knife Fight (“MKF”) in the first quarter of 2021, the Company recorded contingent consideration of $ 58.7 million.

During the second quarter of 2023, the Company, in satisfaction of contingencies related to the respective acquisition agreements, settled the remaining contingent consideration of $ 9.3 million, comprised of 386,926 immediately exercisable penny warrants, 103,656 shares of Bally’s Corporation common stock and a de minimis payment in cash.

In connection with the acquisition of Bally’s Golf Links on September 12, 2023, the Company recorded contingent consideration, which was valued at $ 58.8 million as of September 30, 2024.

Refer to Note 6 “ Business Combinations ” for further information.

These changes in fair value are recognized within “Other non-operating income (expense), net” of the condensed consolidated statements of operations.

In connection with the acquisition of Bally’s Golf Links on September 12, 2023, the Company recorded contingent consideration, which was valued at $ 57.7 million as of March 31, 2025 (Successor).

The amount included in purchase consideration is the fair value, under GAAP, of expected cash payments totaling up to $125 million to the seller, based upon future events, which are uncertain.

Inputs to this valuation approach include the Company’s estimated probabilities of achieving the conditions for payment, expected terms between 1.3 and 1.8 Years, and discount rates of 6.6%.

The settlement of the contingent consideration liabilities will be due to the seller in the event the license agreement is extended or if the Company is successful in its bid for a casino license.

Convertible Loans

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The Company recorded instruments within “Other assets” at their fair value.

The fair value of the loans to vendors have share values based on unobservable inputs and are classified within Level 3 of the hierarchy, with changes to fair value included within “Other non-operating (expense) income, net” of the condensed consolidated statements of operations.

Investments in Equity Securities

The fair value of the loans to vendors have share values based on unobservable inputs and are classified within Level 3 of the hierarchy, with changes to fair value included within “Other non-operating income (expense), net” of the condensed consolidated statements of operations.

Loan Receivable

Following the Queen Merger, the Company has a receivable from a third-party investment holding company for a delayed draw term loan issued (“Delayed Draw Loan”).

The Delayed Draw Loan has an unpaid principal balance of € 25.0 million and is accounted for under the fair value option allowed by ASC 825, Financial Instruments, as the Company believes the fair value option more closely approximates the economics associated with the loan.

The estimated fair value of the Delayed Draw Loan is based upon the fair value of the shares of Intralot the Company would expect to receive upon repayment of the Delayed Draw Loan.

The Company measures fair value using quoted prices in active markets and its assessment of the share settlement feature, which are classified within Level 2 of the hierarchy, with changes to fair value of $ 1.2 million included within “Other non-operating income (expense), net” of the condensed consolidated statements of operations for the period from February 8, 2025 to March 31, 2025 (Successor).

Equity Method Investment

The Company has a long-term investment in an unconsolidated entity which it accounts for under the equity method of accounting.

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Under the fair value option, the investment is remeasured at fair value at each reporting period through earnings.

The Company measures fair value using quoted prices in active markets that are classified within Level 1 of the hierarchy, with changes to fair value included within “Other non-operating (expense) income, net” of the condensed consolidated statements of operations.

The Company measures fair value using quoted prices in active markets that are classified within Level 1 of the hierarchy, with changes to fair value included within “Other non-operating income (expense), net” of the condensed consolidated statements of operations.

Investment in GLPI Partnership

The Company holds a limited partnership interest in GLP Capital, L.P., the operating partnership of GLPI.

The investment is reported at fair value based on Level 2 inputs, with changes to fair value included within “Other non-operating (expense) income, net” of the condensed consolidated statements of operations.

The investment is reported at fair value based on Level 2 inputs, with changes to fair value included within “Other non-operating income (expense), net” of the condensed consolidated statements of operations.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Long-Term Debt

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Refer to Note 15 “Long-Term Debt” for further information.

September 30, 2024 December 31, 2023

Successor Predecessor

March 31, 2025 December 31, 2024

(in thousands) Carrying Amount Fair Value Carrying Amount Fair Value

4 unchanged sentences

499,247 489,694 721,456 535,631

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

11.00 % Senior Secured Notes due 2028

479,340 479,340 — —

ACCRUED AND OTHER CURRENT LIABILITIES

As of September 30, 2024 and December 31, 2023, accrued and other current liabilities consisted of the following:

(in thousands) September 30,

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), accrued and other current liabilities consisted of the following:

Successor Predecessor

(in thousands) March 31,

2025 December 31,

Diamond Sports Group non-cash liability (1)

$ 202,572 $ 144,883

Gaming liabilities $ 186,703 $ 187,233

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Interest payable 45,307 60,792

Bally’s Chicago - land development liability — 47,739

Construction accruals 11,052 2,144

Insurance reserves 20,723 23,898

Property taxes 14,443 8,502

Other 198,808 132,367

Total accrued and other current liabilities $ 542,977 $ 481,292

__________________________________

(1) Refer to Note 17 “ Commitments and Contingencies ” for further information.

RESTRUCTURING EXPENSE

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As a result of the closure, the Company incurred restructuring charges representing employee-related severance costs and accelerated depreciation of certain property and equipment.

The components of restructuring charges by segment for the three and nine months ended September 30, 2024 and 2023 are summarized as follows (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The components of restructuring charges by segment for the three months ended March 31, 2024 (Predecessor) are summarized as follows (in thousands):

Three Months Ended March 31, 2024

Severance and employee related benefits (1)

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North America Interactive ( 1,479 )

Other — — 410 1,688

Corporate & Other 385

Total severance and employee related benefits 18,613

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(2) Included within “Depreciation and amortization” of the Casinos & Resorts reportable segment within the condensed consolidated statements of operations.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The changes in the Company’s restructuring related liabilities for the nine months ended September 30, 2024 is as follows:

(in thousands)

Balance as of December 31, 2023

Charges, net 17,921

Payments ( 22,370 )

Effect of foreign exchange ( 842 )

Balance as of September 30, 2024

The restructuring liability as of September 30, 2024 and December 31, 2023 is included within “Accrued and other current liabilities” on the condensed consolidated balance sheets.

The was no restructuring liability as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor) on the condensed consolidated balance sheets.

LONG-TERM DEBT

As of September 30, 2024 and December 31, 2023, long-term debt consisted of the following:

(in thousands) September 30,

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), long-term debt consisted of the following:

Successor Predecessor

(in thousands) March 31,

2025 December 31,

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735,000 735,000

11.00 % Senior Secured Notes due 2028

Unamortized original issue discount ( 14,531 ) ( 19,760 )

Unamortized deferred financing fees ( 6,128 ) ( 33,117 )

Unamortized fair value adjustment (2)

( 530,970 ) —

Long-term debt, including current portion 3,450,159 3,318,773

Current portion of Term Loan and Revolving Credit Facility ( 19,450 ) ( 19,450 )

Long-term debt, net of discount and deferred financing fees, excluding current portion $ 3,651,488 $ 3,643,185

Long-term debt, net of discount, deferred financing fees and fair value adjustment, excluding current portion $ 3,430,709 $ 3,299,323

__________________________________

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Refer to Note 11 “ Derivative Instruments ” for further information.

(2) Represents adjustment to recognize the Company’s existing debt at fair value in the Company Merger, calculated as the difference between the fair value of the Company’s term loan facility and unsecured notes, estimated based on quoted prices in active markets as of the Closing Date, and the respective ending principal balances as of February 7, 2025.

The adjustment is amortized through Interest Expense, Net using the effective interest method.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

In connection with the closing of the Merger on February 7, 2025, the Company entered into a note purchase agreement and issued $ 500.0 million in aggregate principal amount of first lien senior secured notes due 2028 (the “2028 Notes”) at an annual interest rate of 11 %, payable in cash quarterly in arrears, beginning on April 1, 2025.

The 2028 Notes were issued by the Company and certain of its restricted subsidiaries that guarantee the Company’s obligations under its Credit Agreement as guarantors, Alter Domus (US) LLC as the note agent and collateral agent, and the purchasers party thereto.

The 2028 Notes mature on October 2, 2028.

The 2028 Notes are guaranteed by the Company’s restricted subsidiaries, subject to certain exceptions, and secured by a first-priority lien on substantially all of the Company’s and each of the guarantors’ assets, subject to certain exceptions.

The note purchase agreement includes mandatory redemption offer provisions that require the Company to make an offer to redeem the 2028 Notes upon certain events, include with the proceeds of certain asset sales and casualty events, certain unpermitted debt issuances and a percentage of the Company’s and its restricted subsidiaries’ annual excess cash flow.

The Company may also voluntarily redeem some or all of the 2028 Notes.

Voluntary and mandatory redemptions of the 2028 Notes on or prior to the first anniversary of the issuance date are subject to a customary “make-whole” premium.

Voluntary and mandatory repayments or redemptions of the 2028 Notes after the first anniversary of the issuance date but on or prior to the second anniversary are subject to a prepayment premium of 5.50 % of the principal amount of notes so repaid or redeemed.

Voluntary and mandatory repayments or redemptions of the 2028 Notes after the second anniversary are not subject to any prepayment or similar premium and may be made at par.

The note purchase agreement contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, (1) incur additional indebtedness, (2) pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, (3) enter into certain transactions with affiliates, (4) sell or otherwise dispose of assets, (5) create or incur liens, and (6) merge, consolidate, or sell all or substantially all of the Company’s assets.

These covenants are subject to exceptions and qualifications set forth in the note purchase agreement.

As of March 31, 2025 (Successor), the Company was in compliance with all such covenants.

In connection with the Merger, the Company settled the pre-existing debt of Queen and recorded a loss on extinguishment of debt of $ 17.4 million, recorded within “Other non-operating income (expense), net” in the condensed consolidated statements of operations for the period from February 8, 2025, to March 31, 2025 (Successor).

Unsecured Notes

On August 20, 2021, two unrestricted subsidiaries (together, the “Escrow Issuers”) of the Company issued $ 750.0 million aggregate principal amount of 5.625 % senior notes due 2029 (the “2029 Notes”) and $ 750.0 million aggregate principal amount of 5.875 % Senior Notes due 2031 (the “2031 Notes” and, together with the 2029 Notes, the “Senior Notes”).

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

During the nine months ended September 30, 2023, the Company repurchased and retired $ 15.0 million of the 2031 Notes at a weighted average price of 70.80 % of the principal.

In connection with the repurchase of these 2031 Notes, the Company recorded a gain on extinguishment of debt of $ 4.0 million recorded within “Other non-operating (expense) income, net” in the condensed consolidated statements of operations.

The indenture contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, (1) incur additional indebtedness, (2) pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, (3) enter into certain transactions with affiliates, (4) sell or otherwise dispose of assets, (5) create or incur liens and (6) merge, consolidate or sell all or substantially all of the Company’s assets.

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The Revolving Credit Facility contains a financial covenant regarding a maximum first lien net leverage ratio that applies when borrowings under the Revolving Credit Facility exceed 30 % of the total revolving commitment.

As of September 30, 2024, the Company was in compliance with all such covenants.

As of March 31, 2025 (Successor), the Company was in compliance with all such covenants.

In an effort to mitigate the interest rate risk associated with the Company’s variable rate credit facilities, the Company utilizes interest rate and cross currency swap derivative instruments.

Refer to Note 11 “Derivative Instruments” for further information.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Operating Leases

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Discount rates used to determine the present value of the lease payments are based on the Company’s incremental borrowing rate commensurate with the term of the lease.

The Company had total operating lease liabilities of $ 1.37 billion and $ 1.20 billion as of September 30, 2024 and December 31, 2023, respectively, and right of use assets of $ 1.26 billion and $ 1.16 billion as of September 30, 2024 and December 31, 2023, respectively, which were included in the condensed consolidated balance sheets.

As of September 30, 2024, the Company’s Bally’s Evansville, Bally’s Dover, Bally’s Quad Cities, Bally’s Black Hawk, Bally’s Tiverton and Hard Rock Biloxi properties are leased under the terms of a master lease agreement (the “Master Lease”) with GLPI.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The Company had total operating lease liabilities of $ 2.10 billion and $ 1.62 billion as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), respectively, and right of use assets of $ 1.91 billion and $ 1.54 billion as of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), respectively, which were included in the condensed consolidated balance sheets.

As of March 31, 2025 (Successor), unfavorable off-market components of $ 130.8 million were recognized as a decrease to right of use assets in connection with remeasuring the Company’s lease liabilities to the present value of the remaining lease payments due to the Company Merger (refer to Note 7, “Business Combinations” for further information).

The off-market components will be amortized as a reduction of lease expense on a straight line basis over the remaining lease term.

As of March 31, 2025 (Successor), the Company leases certain properties from GLPI under two separate master lease agreements, the “Master Lease,” and the “Master Lease No.

2.” The Company’s Bally’s Evansville, Bally’s Dover, Bally’s Quad Cities, Bally’s Black Hawk, Bally’s Tiverton and Hard Rock Biloxi properties are leased under the terms of the “Master Lease” which requires combined minimum annual payments of $ 106.1 million.

The Company’s Bally’s Kansas City and Bally’s Shreveport properties are leased under the terms of the “Master Lease No.

2” which requires combined minimum annual payments of $ 32.2 million.

All GLPI leases are accounted for as operating leases within the provisions of ASC 842, Leases (“ASC 842”), over the lease term or until a re-assessment event occurs.

The Master Lease has an initial term of 15 years and includes four , five-year options to renew and requires combined minimum annual payments of $ 100.5 million, subject to minimum 1% annual escalation or greater escalation dependent on CPI.

The renewal options are not reasonably certain of exercise as of September 30, 2024.

On January 3, 2023, the Company completed a transaction with GLP Capital, L.P (“GLP”)., an affiliate of GLPI, related to the land and real estate assets of Bally’s Tiverton and Hard Rock Biloxi for total consideration of $ 625.4 million.

The transaction was structured as a tax-free capital contribution and a substantial portion of the proceeds was used to reduce the Company’s debt.

These properties were added to the Master Lease, increasing minimum annual payments by $ 48.5 million.

During the nine months ended September 30, 2023, the Company recorded a gain of $ 374.3 million representing the difference in the transaction price and the derecognition of assets.

This gain is reflected as “Loss (gain) on sale-leaseback, net” in the condensed consolidated statements of operations.

In addition to the properties under the Master Lease explained above, the Company leases land associated with Tropicana Las Vegas under a ground lease established with GLPI in 2022.

Both leases have an initial term of 15 years and include four , five-year options to renew and are subject to a minimum 1% annual escalation or greater escalation dependent on CPI.

The renewal options are not reasonably certain of exercise as of March 31, 2025 (Successor).

Following the Merger, the Company also has a master lease agreement through Queen with GLPI, the “Queen Master Lease”, with The Queen Baton Rouge, The Belle of Baton Rouge, Casino Queen Marquette and DraftKings at Casino Queen properties being leased under the terms of the Queen Master Lease, which requires combined minimum annual payments of $ 31.9 million.

All GLPI leases are accounted for as operating leases within the provisions of ASC 842, over the lease term or until a re-assessment event occurs.

The Queen Master Lease has an initial term of 15 years and includes four , five-year options to renew and is subject to annual escalation.

The renewal options are not reasonably certain of exercise as of March 31, 2025 (Successor).

In addition to the properties under the master leases explained above, the Company leases land associated with Tropicana Las Vegas under a ground lease established with GLPI in 2022.

This lease has an initial term of 50 years, with the possibility of extending up to 99 years through renewal options.

Annual rent under the lease is $ 10.5 million, subject to minimum 1% annual escalation or greater escalation dependent on CPI.

As of September 30, 2024, the renewal options are not considered reasonably certain to be exercised.

During the third quarter, the Company modified the lease and GLPI paid $ 48.6 million to the Company to fund the demolition of the building at the Tropicana Las Vegas site in exchange for an increase in annual rent of $ 4.1 million, also subject to a minimum 1% annual increase or greater based on CPI.

As of March 31, 2025 (Successor), the renewal options are not considered reasonably certain to be exercised.

During the third quarter of 2024, the Company modified the lease and GLPI paid $ 48.6 million to the Company to fund the demolition of the building at the Tropicana Las Vegas site in exchange for an increase in annual rent of $ 4.1 million, also subject to a minimum 1% annual increase or greater based on CPI.

This lease modification did not change the lease classification.

The cash received is treated as a lessor incentive, leading to an adjustment in the Right of Use asset for the total funding amount.

Upon modification, the Lease Liability and Right of Use asset were adjusted to reflect the present value of the increased future lease payment.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Components of lease expense, included within “General and administrative” in the condensed consolidated statements of operations, for operating leases during the three and nine months ended September 30, 2024 and 2023 are as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

Components of lease expense, included within “General and administrative” in the condensed consolidated statements of operations, for operating leases during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor) are as follows:

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Operating leases:

4 unchanged sentences

Total lease expense $ 39,142 $ 25,345 $ 45,462

Supplemental cash flow and other information related to operating leases for the three and nine months ended September 30, 2024 and 2023 are as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Supplemental cash flow and other information related to operating leases for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor) are as follows:

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Cash paid for amounts included in the lease liability - operating cash flows from operating leases $ 18,484 $ 30,843 $ 31,549

Right of use assets obtained in exchange for operating lease liabilities $ 192,085 $ 1,748 $ 192,716 $ 405,407

Derecognition of financing obligation $ ( 200,000 ) $ — $ ( 200,000 ) $ —

September 30, 2024 December 31, 2023

Successor Predecessor

March 31, 2025 December 31, 2024

Weighted average remaining lease term 26.2 years 26.2 years

Weighted average discount rate 7.3 % 8.5 %

As of September 30, 2024, future minimum lease payments under noncancelable operating leases are as follows:

(in thousands) September 30, 2024

As of March 31, 2025 (Successor), future minimum lease payments under noncancellable operating leases are as follows:

(in thousands) March 31, 2025

Remaining 2025 $ 181,152

3 unchanged sentences

Lease obligations $ 2,098,303

Future minimum lease payments disclosed in the table above include $ 87.7 million related to extension options that are reasonably certain of being exercised.

The table above does not include $ 6.5 million of payments for leases signed but not yet commenced as of September 30, 2024.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Financing Obligation

Bally’s Chicago Operating Company, LLC., an indirect wholly-owned subsidiary of the Company, entered into a ground lease for the land on which Bally’s Chicago will be built, which was accounted for as a financing obligation in accordance with ASC 470, Debt, as the transaction did not qualify as a sale under ASC 842.

The lease commenced November 18, 2022 and had a 99-year term followed by ten separate 20-year renewals at the Company’s option.

The Company recorded land within “Property and equipment, net” of $ 200.0 million with a corresponding liability within “Long-term portion of financing obligation” of $ 200.0 million on its condensed consolidated balance sheets as of December 31, 2023.

All lease payments were recorded as interest expense and there was no reduction to the financing obligation.

Bally’s Chicago made cash payments, and recorded corresponding interest expense of $ 3.1 million and $ 4.3 million during the three months ended September 30, 2024 and 2023, respectively, and $ 12.4 million and $ 13.0 million during the nine months ended September 30, 2024 and 2023, respectively.

In the third quarter of 2024, GLP acquired the real estate underlying the Bally’s Chicago project, for which the Company was subject to the financing obligation, and assumed the existing lease.

The lease with GLP was amended in the third quarter, creating a lease modification event whereby the land components previously classified as a financing obligation were reassessed and now classified as an operating lease.

This change was due to the transfer of control of the land asset from the Company to the lessor, which permitted sale recognition in accordance with ASC 842.

As a result of this reassessment, the Company derecognized $ 350.0 million from “Property and equipment, net” related to the land asset and $ 200.0 million from the “Long-term portion of financing obligation” within our Condensed Consolidated Balance Sheets.

As a result of the lease modification, a $ 150.0 million offset in “Loss (gain) on sale-leaseback, net” was recorded within the Condensed Consolidated Statements of Operations for the three and nine months ending September 30, 2024.

Pending Lease Transactions

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The initial lease term for the Chicago MLA is 15 years with renewal options to be agreed upon by the parties.

The Company will also sell and lease back from GLP its properties in Kansas City and Shreveport for $ 395 million, with initial annual rent of $ 32.2 million, subject to escalation.

In addition, the Company plans to sell and lease back its Bally’s Twin River property to GLP by the end of 2026 for $ 735 million, with initial annual rent of $ 58.8 million.

2 unchanged sentences

The Company leases its hotel rooms to patrons and records the corresponding lessor revenue in Non-gaming revenue within our condensed consolidated statements of operations.

The Company had lessor revenues related to the rental of hotel rooms of $ 41.7 million and $ 56.7 million for the three months ended September 30, 2024 and 2023, respectively, and $ 118.0 million and $ 155.5 million for the nine months ended September 30, 2024 and 2023, respectively.

The Company had lessor revenues related to the rental of hotel rooms of $ 18.7 million, $ 11.0 million and $ 41.1 million for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor), respectively.

Hotel leasing arrangements vary in duration, but are short-term in nature.

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There is no fixed time period to complete share repurchases.

As of September 30, 2024 and December 31, 2023, $ 95.5 million was available for use under the capital return program.

There was no share repurchase activity during the three and nine months ended September 30, 2024 and the three months ended September 30, 2023.

Total share repurchase activity during the nine months ended September 30, 2023 was as follows:

(in thousands, except share and per share data) Nine Months Ended

September 30, 2023

Number of common shares repurchased 1,774,845

Total cost $ 30,458

Average cost per share, including commissions $ 17.16

All shares repurchased during the nine months ended September 30, 2023 were transferred to treasury stock and 40,451 and 1,778,916 shares were retired during those same periods, respectively.

The shares were returned to the status of authorized but unissued.

As of September 30, 2024, there were no shares remaining in treasury.

There were no cash dividends paid during the three and nine months ended September 30, 2024 and 2023.

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), $ 95.5 million was available for use under the capital return program.

There was no share repurchase activity under the capital return program during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and the three months ended March 31, 2024 (Predecessor).

There were no cash dividends paid during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) or the three months ended March 31, 2024 (Predecessor).

Common Stock Offering

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The Company has authorized the issuance of up to 10 million shares of $ 0.01 par value preferred stock.

As of September 30, 2024 and December 31, 2023, no shares of preferred stock have been issued.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

As of March 31, 2025 (Successor) and December 31, 2024 (Predecessor), no shares of preferred stock have been issued.

Shares Outstanding

As of September 30, 2024, the Company had 40,653,346 common shares issued and outstanding.

The Company issued warrants, options and other contingent consideration in acquisitions and strategic partnerships that are expected to result in the issuance of common shares in future periods resulting from the exercise of warrants and options or the achievement of certain performance targets.

As of March 31, 2025 (Successor), the Company had 49,011,796 common shares issued and outstanding.

The Company issued warrants and other contingent consideration in acquisitions and strategic partnerships that are expected to result in the issuance of common shares in future periods resulting from the exercise of warrants or the achievement of certain performance targets.

These incremental shares are summarized below:

Sinclair Penny Warrants (Note 2)

Sinclair Performance Warrants (Note 2)

Sinclair Options (1) (Note 2)

MKF penny warrants (Note 12)

Telescope contingent shares (Note 11)

Outstanding awards under Equity Incentive Plans 701,108

__________________________________

(1) Consists of four equal tranches to purchase shares with exercise prices ranging from $ 30.00 to $ 45.00 per share, exercisable over a seven-year period beginning on the fourth anniversary of the November 18, 2020 closing of the Framework Agreement.

Accumulated Other Comprehensive Income (Loss)

The following tables reflect the changes in accumulated other comprehensive loss by component for the period from February 8, 2025 to March 31, 2025 (Successor), Period from January 1, 2025 to February 7, 2025 (Predecessor) and three months ended March 31, 2024 (Predecessor), respectively:

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Accumulated Other Comprehensive Income (Loss)

The following tables reflect the changes in accumulated other comprehensive loss by component for the nine months ended September 30, 2024 and 2023, respectively:

(in thousands) Foreign Currency Translation Adjustment Benefit Plans Cash Flow Hedges (1)

Net Investment Hedges Total

Accumulated other comprehensive (loss) income at December 31, 2023

Accumulated other comprehensive (loss) income at December 31, 2024 (Predecessor)

$ ( 261,745 ) $ 1,746 $ ( 8,189 ) $ 7,921 $ ( 260,267 )

2 unchanged sentences

Tax effect — — ( 352 ) ( 976 ) ( 1,328 )

Accumulated other comprehensive (loss) income at September 30, 2024

Accumulated other comprehensive (loss) income at February 07, 2025 (Predecessor)

$ ( 274,842 ) $ 1,746 $ ( 7,221 ) $ 10,607 $ ( 269,710 )

(in thousands) Foreign Currency Translation Adjustment Cash Flow Hedges (1)

Net Investment Hedges Total

Accumulated other comprehensive (loss) income at February 8, 2025 (Successor)

$ — $ — $ — $ —

(1) As of September 30, 2024, approximately $ 6.8 million of existing gains and losses are estimated to be reclassified into earnings within the next 12 months.

Other comprehensive income (loss) before reclassifications 58,675 ( 18,791 ) ( 24,157 ) 15,727

Reclassifications from accumulated other comprehensive income (loss) to earnings — 485 369 854

Tax effect ( 15,635 ) 4,878 6,339 ( 4,418 )

Accumulated other comprehensive (loss) income at March 31, 2025 (Successor)

$ 43,040 $ ( 13,428 ) $ ( 17,449 ) $ 12,163

__________________________________

(1) As of March 31, 2025 (Successor), approximately $9.2 million of existing gains and losses are estimated to be reclassified into earnings within the next 12 months.

(in thousands) Foreign Currency Translation Adjustment Benefit Plans Cash Flow Hedges Net Investment Hedges Total

4 unchanged sentences

Tax effect — — ( 5,257 ) 6,151 894

Accumulated other comprehensive (loss) income at September 30, 2023

Accumulated other comprehensive (loss) income at March 31, 2024

$ ( 214,997 ) $ 886 $ 1,037 $ ( 10,529 ) $ ( 223,603 )

COMMITMENTS AND CONTINGENCIES

Diamond commenced reorganization proceedings under Chapter 11 of the Bankruptcy Code in March 2023.

In July 2023, Diamond commenced litigation against Sinclair, Bally’s and others as part of its bankruptcy proceedings, challenging a series of transactions between Sinclair and Diamond.

One of the 19 counts in the complaint includes Bally’s as a defendant, alleging that the Commercial Agreement with Sinclair involved fraudulent transfers and unlawful distributions.

In the first quarter of 2024, Diamond agreed to settle these claims against all defendants, including Bally’s.

Under the settlement terms, Diamond would receive payments from Sinclair and would reject the Commercial Agreement.

Bally’s would continue to have naming rights on Diamond’s RSNs through the 2024 major league baseball season at no cost to either party (unless Diamond agrees with a new counterparty that will pay for such naming rights).

Bally’s, in turn, would receive a release of all claims Diamond may have against it.

Bally’s obligation to pay Diamond for the naming rights terminated upon the bankruptcy court’s approval of the settlement terms, which the court approved on March 1, 2024, and the Company derecognized the rights fees liability against the non-cash liability established at December 31, 2023.

Bally’s has recorded a $ 202.6 million non-cash liability to reflect the effect of the termination of naming rights on its remaining commercial rights intangible asset originally recorded at the time that the arrangement was agreed, which will occur in the fourth quarter of 2024.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

COMMITMENTS AND CONTINGENCIES

The Company is a party to other various legal and administrative proceedings which have arisen in the ordinary course of its business.

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Capital Expenditure Commitments

Bally’s Atlantic City - As part of the regulatory approval process with the State of New Jersey, the Company committed to spend $ 100 million in capital expenditures over a five year period to invest in and improve the property.

The commitment calls for expenditures of no less than $ 85 million in aggregate by 2023.

The remaining $ 15 million of committed capital must be spent over 2024 and 2025.

From 2021 through 2025, no less than $ 35 million must be invested in the hotel and no less than $ 65 million must be invested in non-hotel projects.

As of September 30, 2024, all investment requirements had been met and no commitment to invest in non-hotel projects remains.

Bally’s Twin River - Pursuant to the terms of the Regulatory Agreement in Rhode Island, the Company is committed to invest $ 100 million in its Rhode Island properties over the term of the master contract through June 30, 2043, including an expansion and the addition of new amenities at Bally’s Twin River.

As of September 30, 2024, approximately $ 48.2 million of the commitment remains.

As of March 31, 2025 (Successor), approximately $ 45.0 million of the commitment remains.

Bally’s Chicago - Pursuant to the Host Community Agreement with the City of Chicago, the Company’s indirect subsidiary is required to spend at least $ 1.34 billion on the design, construction and outfitting of the temporary casino and the permanent resort and casino.

1 unchanged sentence

In addition, land acquisition costs and financing costs, among other types of costs, are not counted toward meeting this requirement.

March 31, 2025 (Successor), approximately $ 1.00 billion of this commitment remains.

City of Chicago Guaranty

2 unchanged sentences

Bally’s Chicago Casino Fees

Under the Illinois Gambling Act, the Company will be responsible to pay the Illinois Gaming Board a reconciliation fee payment three years after the date operations commenced (in a temporary or permanent facility) in an amount equal to 75% of the adjusted gross receipt (“AGR”) for the most lucrative 12-month period of operations, minus the amount equal to the initial payment per gaming position paid.

75% of the adjusted gross receipt (“AGR”) for the most lucrative 12-month period of operations, minus the amount equal to the initial payment per gaming position paid.

Sponsorship Commitments

As of September 30, 2024, the Company has entered into multiple sponsorship agreements with various professional sports leagues and teams.

As of March 31, 2025 (Successor), the Company has entered into multiple sponsorship agreements with various professional sports leagues and teams.

These agreements commit a total of $ 122.7 million through 2036 and grant the Company rights to use official league marks for branding and promotions, among other benefits.

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The Company has certain multi-year agreements with its various market access and content providers, as well as its online sports betting platform partners, that require the Company to pay variable fees based on revenue, with minimum annual guarantees.

As of September 30, 2024, the cumulative minimum obligation committed in these agreements is approximately $ 54.7 million through 2029.

As of March 31, 2025 (Successor), the cumulative minimum obligation committed in these agreements is approximately $ 37.6 million through 2029.

SEGMENT REPORTING

1 unchanged sentence

Casinos & Resorts, International Interactive and North America Interactive.

The “Other” category includes interest expense for the Company and certain unallocated corporate operating expenses and other adjustments, including eliminations of transactions among segments to reconcile to the Company’s consolidated results including, among other expenses, share-based compensation, acquisition and other transaction costs and certain non-recurring charges.

The Company’s three reportable segments as of September 30, 2024 are:

Casinos & Resorts - Includes the Company’s 15 casino and resort properties, one horse racetrack and one golf course.

International Interactive - Gamesys’ European and Asian operations.

North America Interactive - A portfolio of sports betting, iGaming, and free-to-play gaming brands, and the North American operations of Gamesys.

As of September 30, 2024, the Company’s operations were predominately in the US, Europe and Asia with a less substantive footprint in other countries world-wide.

For geographical reporting purposes, revenue generated outside of the US has been aggregated into the International Interactive reporting segment, and consists primarily of revenue from the UK and Japan.

Revenue generated from the UK and Japan represented approximately 28 % and 6 % of total revenue, respectively, for the three months ended September 30, 2024, approximately 25 % and 11 %, respectively, for the three months ended September 30, 2023, approximately 27 % and 8 %, respectively, for the nine months ended September 30, 2024, and approximately 25 % and 11 %, respectively, for the nine months ended September 30, 2023.

The Company does not have any revenues from any individual customers that exceed 10% of total reported revenues.

Beginning in the third quarter of 2023, the Company updated its measure of segment performance to Adjusted EBITDAR (defined below) from Adjusted EBITDA.

The “Corporate & Other” category includes interest expense, select immaterial operating segments, unallocated corporate operating expenses, and other adjustments, such as eliminations of inter-segment transactions, to reconcile with the Company’s consolidated results.

This category further accounts for other expenses such as share-based compensation, acquisition and transaction costs, and other non-recurring charges.

During the first quarter of 2025, the Company moved a component of the North America Interactive operating segment to a separate operating segment, which is reported in the Corporate & Other category, to better align with the Company’s strategic growth initiatives and how its chief operating decision maker evaluates performance and allocates resources.

Comparable prior period segment results have been re-cast to reflect this change.

The prior year results presented below were reclassified to conform to the new segment presentation.

The Company’s three reportable segments as of March 31, 2025 (Successor) are:

Casinos & Resorts - Includes the Company’s 19 casino and resort properties, one horse racetrack and one golf course.

International Interactive - Includes the Company’s interactive European gaming operations, the Company’s global licensing revenue generating operations, as well as one casino property, Bally's Newcastle, in the UK.

North America Interactive - A portfolio of sports betting, iGaming, and free-to-play gaming brands.

The Company’s chief operating decision maker is its Executive Committee, consisting of the Chief Executive Officer, President, and Chief Financial Officer.

The Company uses consolidated Adjusted EBITDA and segment Adjusted EBITDAR to analyze the performance of its business and they are used as determining factors for performance-based compensation for members of the Company’s management team.

The Company uses consolidated Adjusted EBITDA and segment Adjusted EBITDAR when evaluating the operating performance of the business because management believes that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a more fulsome understanding of the core operating results and as a means to evaluate period-to-period performance.

Management believes segment Adjusted EBITDAR is representative of its ongoing business operations including its ability to service debt and to fund capital expenditures, acquisitions and operations, in addition to it being a commonly used measure of performance in the gaming industry and used by industry analysts to evaluate operations and operating performance.

As of March 31, 2025 (Successor), the Company’s operations were predominately in the US and Europe with a less substantive footprint in other countries world-wide.

For geographical reporting purposes, revenue generated outside of the US has been aggregated into the International Interactive reporting segment, and consists primarily of revenue from the UK.

Revenue generated from the UK represented approximately 27 % and 32 % of total revenue for the period from February 8, 2025 to March 31, 2025 (Successor) and the period from January 1, 2025 to February 7, 2025 (Predecessor), respectively.

For the the three months ended March 31, 2024 (Predecessor), the Company’s revenue generated outside of the US consisted primarily of revenue from the UK and Japan of approximately 26 % and 10 % of total revenue, respectively.

The Company does not have any revenues from any individual customers that exceed 10% of total reported revenues.

The following table sets forth revenue and Adjusted EBITDAR for the Company’s three reportable segments and reconciles Adjusted EBITDAR on a consolidated basis to net (loss) income.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2024 2023 2024 2023

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Casinos & Resorts $ 226,851 $ 124,299 $ 342,329

1 unchanged sentence

North America Interactive 27,557 16,941 39,567

Corporate & Other 1,536 273 1,903

Total $ 368,694 $ 220,498 $ 618,482

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North America Interactive ( 2,345 ) ( 5,661 ) ( 9,114 )

Other ( 13,163 ) ( 12,883 ) ( 40,377 ) ( 46,687 )

Corporate & Other ( 9,703 ) ( 6,774 ) ( 15,721 )

Total 107,687 40,059 148,115

5 unchanged sentences

Restructuring — — ( 18,613 )

Tropicana Las Vegas demolition costs ( 19,643 ) — ( 31,904 ) —

Tropicana Las Vegas demolition and closure costs ( 5,931 ) ( 2,605 ) ( 464 )

Share-based compensation ( 2,740 ) ( 1,954 ) ( 3,058 )

(Loss) gain on sale-leaseback, net ( 150,000 ) — ( 150,000 ) 374,321

Impairment charges — — ( 12,757 ) ( 9,653 )

Merger Agreement costs (3)

1 unchanged sentence

Payment Service Provider write-off (4)

( 6,333 ) — ( 6,333 ) —

Other ( 5,316 ) ( 1,915 ) ( 2,212 )

Income (loss) from operations ( 157,655 ) 37,236 ( 226,037 ) 419,950

Loss from operations ( 1,810 ) ( 20,766 ) ( 73,955 )

Other (expense) income

2 unchanged sentences

Total other expense, net ( 60,767 ) ( 29,594 ) ( 68,577 )

(Loss) income before income taxes ( 281,484 ) ( 17,866 ) ( 485,713 ) 243,912

Loss before income taxes ( 62,577 ) ( 50,360 ) ( 142,532 )

Benefit (provision) for income taxes 97,093 ( 664 ) ( 31,382 )

Net (loss) income $ ( 247,855 ) $ ( 61,802 ) $ ( 481,965 ) $ 90,883

Net income (loss) $ 34,516 $ ( 51,024 ) $ ( 173,914 )

__________________________________

4 unchanged sentences

(3) Costs incurred in connection with the Merger Agreement discussed in Note 1 “General Information.”

(4) In the third quarter, the Company recorded a $ 6.3 million charge to reduce amounts due from payment service providers (“PSP”) due to a circumstance whereby the payment processer for certain online sports wagering deposits failed to capture and settle funds with patrons of the Company.

The Company was not able to recover the full amount due from the payment service provider, resulting in a write down to the recoverable amount.

In addition to amounts recovered, the Company received $ 5.1 million from the PSP as a signing bonus for entering into an extension agreement.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2024 2023 2024 2023

The following table sets forth significant segment expenses and other segment items by reportable segment (in thousands):

Casinos & Resorts International Interactive North America Interactive

Period from February 8, 2025 to March 31, 2025 (Successor)

Revenue $ 226,851 $ 112,750 $ 27,557

segment expenses

Marketing costs 11,612 11,662 7,051

Gaming tax 29,173 23,061 9,012

Compensation 57,716 11,843 4,481

Other direct costs — 11,413 11,652

Casino property costs 37,174 — —

General and administrative 14,941 8,732 3,096

Other segment items (1)

4,695 ( 2,156 ) ( 5,390 )

Segment EBITDAR 71,540 48,195 ( 2,345 )

Period from January 1, 2025 to February 7, 2025 (Predecessor)

Revenue $ 124,299 $ 78,985 $ 16,941

segment expenses

Marketing costs 8,814 8,362 5,055

Gaming tax 20,917 16,535 6,461

Compensation 41,381 8,492 3,213

Other direct costs — 8,183 8,355

Casino property costs 26,653 — —

General and administrative 10,712 6,261 2,220

Other segment items (1) ( 7,732 ) 2,212 ( 2,702 )

Segment EBITDAR 23,554 28,940 ( 5,661 )

Three Months Ended March 31, 2024 (Predecessor)

Revenue $ 342,329 $ 234,683 $ 39,567

segment expenses

Marketing costs 20,668 34,561 12,530

Gaming tax 47,081 36,344 10,135

Compensation 95,830 29,463 4,933

Other direct costs — 37,121 14,485

Casino property costs 33,714 — —

General and administrative 17,262 16,486 4,530

Other segment items (1)

38,356 ( 2,824 ) 2,068

Segment EBITDAR $ 89,418 $ 83,532 $ ( 9,114 )

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(1) Other Segment Items primarily includes Gaming and non-gaming expenses within our Casinos & Resorts reportable segment, and certain other immaterial costs and allocations within each of the Company’s reportable segments.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Successor Predecessor

(in thousands) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Capital Expenditures

2 unchanged sentences

North America Interactive — — 260

Corporate & Other (1)

19,751 10,970 17,668

1 unchanged sentence

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(1) Includes $ 70.3 million and $ 108.3 million related to our future Bally’s Chicago permanent facility during the three and nine months ended September 30, 2024, respectively.

(1) Includes $ 26.3 million, $ 11.0 million and $ 17.5 million related to our future Bally’s Chicago permanent facility during the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor), and the three months ended March 31, 2024 (Predecessor), respectively.

Total assets are not regularly reviewed for each operating segment when assessing segment performance or allocating resources and accordingly, are not presented.

As of September 30, 2024 and December 31, 2023, carrying values of goodwill by reportable segment are as follows:

(in thousands) September 30, 2024 December 31, 2023

Casinos & Resorts (1)

$ 313,285 $ 313,493

International Interactive 1,644,774 1,586,590

North America Interactive (2)

35,750 35,720

$ 1,993,809 $ 1,935,803

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(1) Net of accumulated goodwill impairment charges of $ 5.4 million.

(2) Net of accumulated goodwill impairment charges of $ 140.4 million

(3) The effect of foreign exchange on the change in total goodwill from December 31, 2023 was $ 58.2 million .

EARNINGS (LOSS) PER SHARE

Diluted earnings per share includes the determinants of basic earnings per share and, in addition, reflects the dilutive effect of the common stock deliverable for stock options, using the treasury stock method, and for RSUs, RSAs and PSUs for which future service is required as a condition to the delivery of the underlying common stock.

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except per share data) 2024 2023 2024 2023

Net (loss) income applicable to common stockholders

Successor Predecessor

(in thousands, except per share data) Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Three Months Ended March 31, 2024

Net income (loss) applicable to common stockholders

$ 34,516 $ ( 51,024 ) $ ( 173,914 )

2 unchanged sentences

Weighted average common shares outstanding, diluted 60,729 48,743 48,119

Basic (loss) earnings per share $ ( 5.10 ) $ ( 1.15 ) $ ( 9.96 ) $ 1.68

Diluted (loss) earnings per share $ ( 5.10 ) $ ( 1.15 ) $ ( 9.96 ) $ 1.67

There were 4,927,900 and 5,152,994 share-based awards that were considered anti-dilutive for the three months ended September 30, 2024 and 2023, respectively, and 5,108,453 and 5,235,978 share-based awards that were considered anti-dilutive for the nine months ended September 30, 2024 and 2023, respectively.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

On November 18, 2020, the Company issued Penny Warrants, Performance Warrants and Options which participate in dividends with the Company’s common stock subject to certain contingencies.

Basic earnings (loss) per share $ 0.57 $ ( 1.05 ) $ ( 3.61 )

Diluted earnings (loss) per share $ 0.57 $ ( 1.05 ) $ ( 3.61 )

There were 19,943 , 5,056,640 and 5,157,927 share-based awards that were considered anti-dilutive for the period from February 8, 2025 to March 31, 2025 (Successor), the period from January 1, 2025 to February 7, 2025 (Predecessor) and three months ended March 31, 2024 (Predecessor), respectively.

The Company has Penny Warrants which participate in dividends with the Company’s common stock subject to certain contingencies.

In the period in which the contingencies are met, those instruments are participating securities to which income will be allocated using the two-class method.

The Performance Warrants and Options do not participate in net losses.

The Penny Warrants were considered exercisable for little to no consideration and are therefore included in basic shares outstanding at their issuance date.

For the three and nine months ended September 30, 2024 and 2023, the shares underlying the Performance Warrants were anti-dilutive as certain contingencies were not met.

Refer to Note 2 “ Summary of Significant Accounting Policies ” for further information regarding the Framework Agreement.

BALLY’S CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

SUBSEQUENT EVENTS

On October 31, 2024, the Company entered into an agreement to carve-out components of its interactive business in Asia and certain other international markets in its International Interactive reportable segment (the “Carved-Out Business”) to a company (the “Buyer”) formed by members of the management of the Carved-Out Business.

The Buyer is acquiring the net-assets, predominantly working capital, of the Carved-Out Business, in exchange for a seven-year term note in the principal amount of € 30 million, subject to applicable interest.

Certain intellectual property used in the Carved-Out Business has been placed in trust, with royalty licensing fees paid to the trust by the Buyer for a term of five years (subject to extension).

All royalty licensing fees, net of trustee administrative expenses, are paid to the Company by the trust and are expected to be reported by the Company as licensing revenues.

The Company will also provide the Carved-Out Business with certain transition services.

In connection with the separation transaction, the Company will acquire penny warrants that represent a 19.9 % fully-diluted interest in the Buyer, which is expected to result in the deconsolidation of the Carved-Out Business.

Bally’s will have no role in the management or operational governance of the Carved-Out Business.

The gain or loss on sale of the Carved-Out Business has not yet been determined as it is subject to valuation procedures and associated Goodwill allocation, the release of accumulated currency translation adjustments for the disposed entities, and other post-closing adjustments.

On April 7, 2025, the Company entered into a Binding Term Sheet with The Star Entertainment Group Limited (“The Star”), pursuant to which Bally’s will invest in a multi-tranche issuance of The Star’s convertible notes and subordinated debt with an aggregate principal amount of AUD $ 300 million (the “Investment”).

The Binding Term Sheet permits The Star’s largest shareholder, Investment Holdings Pty (“Investment Holdings”), to subscribe for up to AUD $ 100 million of the Investment.

On April 8, 2025, The Star announced that it entered into a commitment letter with Investment Holdings under which Investment Holdings will subscribe for AUD $ 100 million of the Investment.

As a result, Bally’s portion of the Investment was reduced to AUD $ 200 million, of which the first tranche, approximately AUD $ 66.7 million (equivalent to USD $ 40.3 million at settlement), closed on April 9, 2025.

Bally’s remaining investment subscription is subject to various approvals and conditions.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements