The Company is committed under various operating lease agreements for real estate and property used in operations. Certain leases include various renewal options which are included in the lease term when the Company has determined it is reasonably certain of exercising the options. Certain of these leases include percentage rent payments based on property revenues and/or rent escalation provisions determined by increases in the consumer price index (“CPI”). These percentage rent and escalation provisions are treated as variable lease payments and recognized as lease expense in the period in which the obligation for those payments are incurred. 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 $2.39 billion and $1.93 billion as of June 30, 2026 (Successor) and December 31, 2025 (Successor), respectively, and right of use assets of $2.23 billion and $1.77 billion as of June 30, 2026 (Successor) and December 31, 2025 (Successor), respectively, which were included in the condensed consolidated balance sheets.

The Company leases certain properties from GLPI under three separate master lease agreements, the “Master Lease,” the “Master Lease No. 2,” and the “Queen Master Lease.” All components of these master lease agreements 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.

On February 11, 2026, the Company completed the sale-leaseback of the land and real estate assets of Bally’s Twin River to GLPI for total consideration of $700.0 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. In connection with this transaction, the Bally’s Twin River property was added to Master Lease No. 2, increasing minimum annual payments by $56.0 million, and with annual escalations and extension options disclosed above. During the first quarter of 2026, the Company recorded a gain of $105.8 million, within Gain on sale-leaseback in the condensed consolidated statements of operations, representing the difference in the transaction price and the derecognition of assets.

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, which is also accounted for as an operating lease within the provisions of ASC 842, over the lease term or until a re-assessment event occurs.

On July 17, 2025, the Company entered into a new master lease agreement with GLPI (the “Chicago MLA”), that amended the previously existing ground lease for the property on which the Company is developing its Chicago Permanent Facility and a development agreement with GLPI (the “Chicago Development Agreement”) pursuant to which GLPI has committed to advance up to $940.0 million (the “GLPI Development Advances”) for the payment of hard costs used to construct the Chicago Permanent Facility in exchange for increasing the amount of rent payable to GLPI under the Chicago MLA.

Under the Chicago Development Agreement, as construction occurs, the Company recognizes a construction receivable on the condensed consolidated balance sheets due from GLPI. To the extent costs exceed the amount to be reimbursed by GLPI, such costs are considered prepaid rent, which will be added to the associated operating lease right of use asset once the lease commences. As of June 30, 2026 (Successor) and December 31, 2025 (Successor), the prepaid rent balance, classified within Other assets, was $222.7 million and $175.8 million, respectively.

Components of lease expense, included within General and administrative in the condensed consolidated statements of operations, for operating leases were as follows:


	Successor								Predecessor
(in thousands)	Three Months Ended June 30, 2026		Three Months Ended June 30, 2025		Six Months Ended June 30, 2026		Period from February 8, 2025 to June 30, 2025		Period from January 1, 2025 to February 7, 2025
Operating leases:
Operating lease cost	$	76,149	$	59,454	$	144,784	$	93,474	$	21,714
Variable lease cost	2,649		2,389		5,163		4,128		1,238
Operating lease expense	78,798		61,843		149,947		97,602		22,952
Short-term lease expense	5,894		7,063		12,050		10,446		2,393
Total lease expense	$	84,692	$	68,906	$	161,997	$	108,048	$	25,345


	Successor								Predecessor
(in thousands)	Three Months Ended June 30, 2026		Three Months Ended June 30, 2025		Six Months Ended June 30, 2026		Period from February 8, 2025 to June 30, 2025		Period from January 1, 2025 to February 7, 2025
Cash paid for amounts included in the lease liability - operating cash flows from operating leases	$	73,299	$	62,141	$	138,964	$	80,625	$	30,843
Right of use assets obtained in exchange for operating lease liabilities	6,728		22,977		516,640		22,977		—
GLPI Development Advances received	176,085		—		274,034		—		—


(in thousands)	June 30, 2026 (Successor)
Remaining 2026	$	142,594
2027	292,327
2028	289,686
2029	290,399
2030	292,158
Thereafter	2,816,119
Total lease payments	4,123,283
Less: present value discount	(1,731,016)
Lease obligations(1)	$	2,392,267

The Company leases its hotel rooms to patrons. Hotel leasing arrangements vary in duration but are short-term in nature. Additionally, the Company leases lottery equipment to government lottery commissions in conjunction with providing related operations, maintenance, and support services. These arrangements are priced either as (i) a fixed fee per machine per period or (ii) a variable fee based on a percentage of the lottery organization’s gross ticket sales.

The Company recorded lessor revenues in “Non-gaming revenue” of $46.5 million and $33.7 million for the three months ended June 30, 2026 and 2025 (Successor), respectively, and $88.2 million, $52.4 million and $11.0 million for the six months ended June 30, 2026 (Successor), the period from February 8, 2025 to June 30, 2025 (Successor) and the period from January 1, 2025 to February 7, 2025 (Predecessor), respectively.