Accel Entertainment, Inc.

Note 1. Description of Business

Accel Entertainment, Inc. (and together with its subsidiaries, the“Company” or “Accel”) is a leading distributed gaming operator in the United States (“U.S.”), as well as a developer of brick-and-mortar casinos that serve local gaming markets and horse racing venues. The Company has operations in Illinois, Montana, Nevada, Nebraska, Georgia, Iowa, Louisiana, South Dakota, West Virginia and Pennsylvania. The Company is subject to the various regulations in the states in which it operates, as well as various other federal, state and local laws and regulations.

The Company’s business primarily consists of the installation, maintenance, operation and servicing of gaming terminals and related equipment, redemption devices that disburse winnings and contain automated teller machine (“ATM”) functionality, and amusement devices in authorized non-casino locations such as bars, restaurants, convenience stores, truck stops, and fraternal and veteran establishments as well as casinos and horse racing venues. The Company also operates stand-alone ATMs in gaming and non-gaming locations and designs and manufactures gaming terminals and related equipment.

Note 2. Summary of Significant Accounting Policies

Basis of presentation and preparation: The consolidated financial statements and accompanying notes were prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of the Company and of its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation.

In November 2024, the Company acquired 85% of the ownership interests in both Toucan Gaming, LLC and LSM Gaming, LLC (herein referred to as “Toucan Gaming”), two Louisiana-based operators and owners of multiple licensed video poker establishments. Concurrent with the acquisition, the Company entered into a redemption agreement with the noncontrolling interest holder in the form of put and call options that would allow the Company to eventually own 100% of Toucan Gaming. The noncontrolling interest holder may exercise its put option after seven years, or the occurrence of a change in control event at the Company. The Company may exercise its call option afterten years or upon termination of key employees of Toucan Gaming for cause. The redemption provisions are not currently considered probable. As these redemption features are not solely within the Company’s control, they cause the noncontrolling interests to be redeemable. As a result, the Company recorded the redeemable noncontrolling interest at its acquisition date fair value to temporary equity based on the proportionate share in net assets of Toucan Gaming, which is reported in the mezzanine section between total liabilities and shareholders’ equity in the consolidated balance sheets. These redeemable noncontrolling interests are subsequently recorded at carrying value, which is adjusted for the noncontrolling interests’ share of net income or loss. If the redemption criteria become probable, the redeemable noncontrolling interests are recorded at the greater of carrying value, which is adjusted for the noncontrolling interests’ share of net income or loss, or estimated redemption value at each reporting period. If the carrying value, after the income or loss attribution, is below the estimated redemption value at each reporting period, the Company remeasures the redeemable noncontrolling interests to its redemption value at which point any measurement period adjustments are recorded to equity and a corresponding adjustment to earnings per share.

Use of estimates: The preparation of consolidated financial statements requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) disclosure of contingent assets and liabilities at the date of the consolidated financial statements and (iii) the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates used by the Company include, among other things, the useful lives for depreciable and amortizable assets, income tax provisions, the evaluation of the future realization of deferred tax assets, projected cash flows in assessing the initial valuation of intangible assets in conjunction with business and asset acquisitions, the selection of useful lives for depreciable and amortizable assets in conjunction with business and asset acquisitions, the valuation of level 3 investments, the valuation of contingent earnout shares, the valuation of interest rate caplets, contingencies, and the expected term of share-based compensation awards and stock price volatility when computing stock-based compensation expense. Actual results may differ from those estimates.

Cash and cash equivalents: Cashand cash equivalents include bank deposit accounts; term bank deposit accounts; cash in the Company’s gaming terminals, ATMs, redemption terminals, and Company vaults.

The Company’s policy is to limit the amount of credit exposure to any one financial institution. The Company maintains its cash in accounts which may at times exceed Federal Deposit Insurance Corporation insured limits. The Company has not experienced any losses in such accounts.

Accounts receivable, net: Accounts receivable, net represent amounts due from third-party locations serviced by the Company and amounts due for machines, software and equipment sold by the Company. The carrying amount of receivables is presented on a net basis as it is reduced by a valuation allowance that reflects management’s best estimate of the amounts that will not be collected. Management determines its allowance for doubtful accounts by regularly evaluating individual receivables from third-party locations and considers a customer’s financial condition, credit history and current economic conditions. The Company's allowance for doubtful accounts was less than$0.1 million and$0.7 million for the years ended December 31, 2025 and 2024, respectively. The Company generally does not charge interest on past due accounts receivable.

Inventories: Inventories consist of gaming machines for sale to third-parties, raw materials, and manufacturing supplies. Inventories are stated at the lower of cost and net realizable value. Cost is determined using the average cost method. Labor and overhead associated with the assembly of gaming machines for sales to third-parties are capitalized and allocated to inventory. Inventories of spare parts are included in other current assets when acquired and are expensed when used to repair equipment.

Derivative instruments: The Company may manage its exposure to certain financial risks through the use of derivative financial instruments (“derivatives”). The Company does not use derivatives for speculative purposes. For a derivative that is designated as a cash flow hedge, changes in the fair value of the derivative are recognized in accumulated other comprehensive income to the extent the derivative is effective at offsetting the changes in the cash flows being hedged until the hedged item affects earnings.

Property and equipment: Property and equipment are stated at cost or fair value at the date of acquisition. Maintenance and repairs are charged to expense as incurred. Major additions, replacements and improvements are capitalized. Depreciation has been computed using the straight-line method over the following estimated useful lives:

• Leasehold improvements are amortized over the shorter of the useful life or the lease.

Development costs directly associated with the acquisition, development and construction of a project are capitalized as a cost of the project during the periods in which activities necessary to prepare the property for its intended use are in progress. Interest costs associated with major construction projects are capitalized as part of the cost of the constructed assets. When no debt is incurred specifically for a project, interest is capitalized on amounts expended for the project using the weighted-average cost of borrowing. Capitalization of interest ceases when the project (or discernible portions of the project) is substantially complete. If substantially all of the construction activities of a project are suspended, capitalization of interest will cease until such activities are resumed.

Equity method investments: In the normal course of business, the Company makes investments in companies that will allow it to expand the Company’s core business and enter new markets. In certain instances, such investments with less than 100% ownership may be considered a variable interest entity (“VIE”). The Company’s management assesses whether it has the power to direct activities that most significantly impact the economic performance of the entity and has an obligation to absorb losses or the right to receive benefits from the entity. The activities that the Company believes most significantly impact the economic performance of its VIE include the unilateral ability to approve the annual budget, to terminate key management and to approve entering into agreements with providers, among others. If the Company determines it has an investment in a VIE, the next step is to determine whether the Company is the primary beneficiary of the VIE, which would require the Company to consolidate the investment. In assessing whether it has acontrolling financial interest, the Company’s management assesses, among other factors, the Company’s risk of loss, its investment percentage and its ability to control the operations of the investment. If the Company determines it is not the primary beneficiary, it will account for the investment under the equity method of accounting.

The Company accounts for its investments in unconsolidated affiliates, which do not meet the controlling financial interest consolidation criteria of the authoritative accounting guidance for VIEs, under the equity method of accounting. Under the equity method of accounting, the Company records its share of net income or loss from equity method investments within (income) loss from unconsolidated affiliates in the consolidated statements of operations and comprehensive income based on the most recently available financials after a lag of one quarter. The Company also adjusts the carrying value of its investments in unconsolidated affiliates based on its share of net income or loss from equity method investments.

In 2024, the Company invested$5.0 million in HBC Gaming LLC (“HBC”), in exchange for a 5% equity interest. HBC is a local entertainment company based in Hampton, New Hampshire that specializes in providing a variety of gaming services to its customers. The Company assessed its investment and determined it is an investment in a VIE, but determined it is not the primary beneficiary and does not consolidate HBC. The Company’s maximum risk of loss is equal to its initial$5.0 million investment. As such, the Company’s 5% investment in HBC qualifies for equity method accounting. The Company recorded its initial investment of$5.0 million within other assets on the consolidated balance sheets. The Company also has obligations to fund additional equity investments in the event certain construction and development milestones are met in an amount up to 10% ownership of HBC, on an undiluted basis, at an additional cost of up to$6.5 million.

The Company recorded a loss from unconsolidated affiliates of less than$0.1 million for both the years ended December 31, 2025 and 2024.

Concentration of credit risk: The Company’s operations are centralized primarily in Illinois, Montana and Nevada. Should there be favorable or unfavorable changes to the gaming regulations in these states there may be an impact on the Company’s results of operations. The Company has high concentrations of locations within certain municipalities in Illinois which could also impact the Company if these municipalities change their gaming laws.

Fair value of financial instruments: The Company’s financial instruments consist principally of cash, accounts payable, route and customer acquisition costs payable, contingent consideration, contingent earnout shares liability, interest rate caplets, and bank indebtedness. The carrying amount of cash, accounts payable and short-term borrowings approximates fair value because of the short-term maturity of these instruments.

The Company estimated the fair value of its interest rate caplets, contingent consideration, and contingent earnout share liability using various methods that are described in Note 12. The Company estimated the fair value of its debt using the method described in Note 9.

Revenue recognition: The Company primarily generates revenues from the following types of services: gaming terminals, amusements and ATMs. The Company also generates manufacturing revenue from thesale of gaming terminals and associated software, as well as revenue from its casino and racing operations. Revenue is disaggregated by type of revenue and is presented on the face of the consolidated statements of operations and comprehensive income.

Net gaming revenue is the net cash from gaming activities, which is the difference between gaming wins and losses. Net gaming revenue includes the amounts earned by the gaming locations and its casino and is recognized at the time of gaming play. Additionally, taxes and administrative expenses due to the states in which the Company operates are recorded as net gaming revenue. Amounts earned by the gaming locations and taxes and administrative expenses are also included in cost of revenue.

Amusement revenue represents amounts collected from machines (e.g. dart boards, digital jukeboxes, pool tables, etc.) operated at various locations and is recognized at the time the machine is used.

Manufacturing revenue represents the sale of gaming terminals and associated software and is recognized at the time the goods are delivered to the customer.

ATM fees and other revenue consists of fees charged for the withdrawal of funds from the Company’s redemption terminals and stand-alone ATM machines and is recognized at the time of the transaction. Beginning in 2025, revenues from the Company’s racing operations are also included.

Revenue from the Company’s racing operations consists of revenue from commissions on pari-mutuel wagering through wagering transactions with customers on both live and simulcast horse races. Commission revenue from pari-mutuel wagering comes from the statutory percentage, or “takeout”, that is wagered on races we host or broadcast. The Company’s racing operations also generate revenue through broader licensing and media rights agreements, sponsorship agreements, ancillary food and beverage services, and fixed-odds sports betting activities through a third-party sports betting operator in which the Company earns a contractual share of revenue generated from online and retail wagers placed by customers through the operator’s sportsbook.

The Company determined that in a gaming environment, whenever a customer’s money has been accepted by a machine, the Company has an obligation (an implied contract) to provide the customer access to the game and honor the outcome of the game (in the case of gaming terminals). The Company determined that when the implied contract is entered into between the Company and the customer, it satisfies the requirements of a contract under the revenue standard, as (i) the contract is a legally enforceable contract with the customer, (ii) the arrangement identifies the rights of the parties, (iii) the contract has commercial substance, and (iv) the cash is received upfront from the customer, so its collectability is probable. The gaming service is a single performance obligation in each implied contract with the customer. The Company applies the portfolio approach of all wins and losses by gaming terminals daily to determine the total transaction price of the portfolio of implied contracts. The Company recognizes revenue when the single performance obligation is satisfied, which is at the completion of each game.

Total net revenues for the years ended December 31, is disaggregated in the following table by the primary states in which the Company operates given the geographic economic factors that affect the revenues in the states.

(1) Revenues for Louisiana only represents two months of operations in 2024.

Route and customer acquisition costs: The Company’s route and customer acquisition costs consist of fees paid, typically an upfront payment and future installment payment over the life of the contract, entered into with third parties and location partners. These contracts are non-cancelable and allow the Company to install and operate gaming terminals in the locations it serves. The route and customer acquisition costs are accounted for as intangible assets and route and customer acquisition costs payable are recorded at the net present value of the future payments using a discount rate equal to the Company’s incremental borrowing rate associated with its long-term debt. Route and customer acquisition costs are amortized on a straight-line basis over a range of less than a year to 18 years beginning on the date the location goes live and amortized over the life of the contract, which includes expected renewals and is recorded in amortization of intangible assets and route and customer acquisition costs in the consolidated statements of operations and comprehensive income. The Company records the accretion of interest on route and customer acquisition costs payable in the consolidated statements of operations and comprehensive incomeas a component of interest expense, net. For locations that close prior to the end of the contractual term, the Company writes-off the net book value of the route and customer acquisition cost and route and customer acquisition cost payable and records a gain or loss in the consolidated statements of operations and comprehensive income as a component of other expenses, net. Additionally, most of the route acquisition contracts allow the Company to clawback some upfront and installment payments over the initial years of a contract if the location is unable to secure the appropriate licensing or it goes out of business prior to the end of the contract term. In the instances where a claw-back or recovery is triggered and the Company assesses it as probable of being recovered, a receivable will be recorded. Upfront payments with a claw-back prior to a location going live are capitalized and will not begin amortization until the respective location commences operations. The Company’s route and customer acquisition costs also consists of prepaid commission costs to the Company's internal sales employees. The commissions paid to internal sales employees are subsequently expensed once the respective gaming location goes live and the commission is earned by the employee.

Business acquisitions: The Company evaluates the inputs, processes and outputs of each business acquisition to determine if the transaction is a business combination or asset acquisition. If an acquisition qualifies as a business combination, the related transaction costs are recorded as an expense in the consolidated statements of operations and comprehensive income. If an acquisition qualifies as an asset acquisition, the related transaction costs are generally capitalized and amortized over the useful life of the acquired assets. The Company accounts for acquisitions that meet the definition of a business combination using the acquisition method of accounting. Acquired tangible personal property such as gaming equipment and buildings are generally measured at fair value using a cost approach which measures the fair value based on the cost to reproduce or replace the asset, while land is valued using a market approach which looks at the values of similar properties. Location contract intangibles, which primarily represent the acquisition-date fair value of the preexisting relationships between the acquired company, gaming locations, and other third parties, are generally measured at fair value using an income approach which measures the fair value based on the estimated future cash flows using certain projected financial information such as revenue projections, cost of revenue margins and other assumptions such as discount rates. Operating licenses that the acquired company holds to operate in its applicable gaming jurisdiction, are valued using an income approach which measures the fair value based on the estimated future cash flows using certain projected financial information such as revenue projections, cost of revenue margins and other assumptions, such as discount rates. Any contingent consideration is measured at its fair value on the acquisition date, recorded as a liability, and accreted over its payment term in the Company’s consolidated statements of operations and comprehensive income as other expenses, net.

Location contracts acquired: Location contracts acquired are accounted for as intangible assets and consist of expected cash flows to be generated from location contracts acquired through business and asset acquisitions. Location contracts acquired are amortized on a straight-line basis over the expected useful life of primarily 15 years. Location contracts are tested for impairment when triggering events occur. If a triggering event were to occur, the Company compares the carrying amount of the location contracts to future undiscounted cash flows. If the value of future undiscounted cash flows is less than the carrying amount of an asset group, an impairment loss is recorded based on the excess of the carrying amount over the fair value of the asset group.

Goodwill: Goodwill represents the difference between the purchase price and the fair value of the identifiable tangible and intangible net assets acquired when accounted for using the acquisition method of accounting. Goodwill is reviewed for impairment annually, as of October 1st, and whenever events or changes in circumstances indicate that the carrying value of the goodwill may not be recoverable. When performing the annual goodwill impairment test, the Company conducts a qualitative assessment to determine whether it is more likely than not that the goodwill is impaired. Under the qualitative assessment, the Company considers both positive and negative factors, including macroeconomic conditions, industry events, financial performance, and makes a determination of whether it is more likely than not that the fair value of the goodwill is less than its carrying amount. If, after assessing the qualitative factors, the Company determines it is more likely than not the goodwill is impaired, it then performs a quantitative test. When performing the quantitative test, the Company compares the fair value of the reporting unit to its carrying value. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, the Company would record an impairment loss equal to the difference.

Consideration payable: Consideration payable consists of amounts payable related to certain business acquisitions as well as contingent consideration for future location performance related to certain business acquisitions (see Note 10). Consideration payable, exclusive of contingent consideration, is discounted using the Company’s incremental borrowing rate associated with its outstanding debt. The contingent consideration is measured at fair value on a recurring basis. The changes in the fair value of contingent consideration are recognized within the Company’s consolidated statements of operations and comprehensive income as other expenses, net. The Company presents on its consolidated statement of cash flows, payments for consideration payable within 90-days in investing activities, payments after 90-days and up to the acquisition date fair value in financing activities, and payments in excess of the acquisition date fair value in operating activities.

Impairment of long-lived assets: Long-lived assets, which includes property and equipment, net and other assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. Impairment of the assets is measured by a comparison of the carrying amount of the asset to future undiscounted cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount of which the carrying amount of the asset exceeds the fair value of theasset.

Contingent earnout shares liability: The Company's Class A-2 common stock is classified as a contingent earnout share liability due to the fact that the conversion of the Company's Class A-2 common stock would be accelerated on a change of control regardless of the transaction value. The liability is stated at fair valueand any change in the fair value is recognized as a gain or loss in the Company’s consolidated statements of operations and comprehensive income.

Leases: The Company determines if an arrangement is a lease at inception and categorizes it as either an operating or finance lease. An arrangement contains a lease when the arrangement conveys the right to control the use of an identified asset over the lease term. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of the Company's leases do not provide an implicit interest rate, the Company utilizes its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a fully collateralized basis over a similar term in an amount equal to the total lease payments in a similar economic environment. Right-of-use(“ROU”) assets are recognized at the lease commencement date of the lease based on the amount of the initial measurement of the lease liability, adjusted for any lease payments made prior to commencement and exclude lease incentives and initial direct costs incurred, if applicable. The lease terms include all non-cancelable periods and may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Lease expense for finance leases is recognized within depreciation and amortization expense for the reduction of the ROU asset and interest expense on the accretion of the lease liability. We do not recognize a ROU asset and lease liability for leases with a duration of less than 12 months. The Company separates lease and non-lease components for our lease contracts.

ROU assets are included in other assets on the consolidated balance sheets. Short-term lease liabilities are included in accounts payable and other accrued expenses while long-term lease liabilities are included in other long-term liabilities.

The Company is the lessor under non-cancelable operating leases for retail and food and beverage outlet space within certain casino properties. The Company also enters into operating lease agreements with certain equipment providers for placement of amusement devices, gaming machines and automated teller machines within its casino properties and branded taverns. The lease arrangements vary in duration but are short term in nature. Revenue is recorded on a straight-line basis over the term of the lease.

Stock-based compensation: The Company awards restricted stock units (“RSUs”) andperformance-based stock units (“PSUs”) to certain employees and officers. Stock-based compensation expense is measured at the grant date, based on the estimated fair value of the award, and is recognized in general and administrative expense over the requisite service period. All stock-based awards are classified as equity.

Income taxes: The Company is organized as a C-corporation and files income tax returns at the federal and state level. Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and net operating loss and tax credit carryforwards, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the book basis of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of the deferred tax asset, will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in the tax laws and rates as of the date of enactment.

The consolidated financial statements may reflect expected future tax consequences of uncertain tax positions presuming the taxing authorities’ full knowledge of the position and all relevant facts. When and if applicable, potential interest and penalty costs are accrued as incurred and recognized in general and administrative expenses in the consolidated statements of operations and comprehensive income.

Earnings per common share: The Company computes basic earnings per common share (“EPS”) by dividing net income by the weighted average number of common shares outstanding for the applicable period. Diluted EPS is computed based on the weighted average number of common shares plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method, unless the effect of such increase would be anti-dilutive. Under the treasury stock method, the amount the employee must pay for exercising stock options and the amount of compensation cost for future service that the Company has not yet recognized are assumed to be used to repurchase shares. Dilutive potential common shares include outstanding stock options, unvested RSUs, unvested PSUs, and contingent earnout shares.

Debt issuance costs: Debt issuance costs are capitalized and amortized over the contractual terms of the related debt. Debt issuance costs are presented as an offset to the related debt on the consolidated balance sheets.

Advertising costs: Advertising costs are primarily comprised of marketing expenses, which are recorded within general and administrative expense within the accompanying consolidated statements of operations and comprehensive income. Advertising costs were$7.2 million, $6.3 million, and$6.1 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Adopted accounting pronouncements: On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid disaggregated by jurisdiction. The new requirements are effective for annual periods beginning after December 15, 2024. The Company has adopted this ASU and has applied the requirements of this standard retrospectively. See Note 19, Income Taxes, for the Company’s disclosures on income taxes which incorporate the disclosure requirements of this ASU.

In November, 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses regularly provided to the CODM. The amendments in this ASU enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company has adopted this guidance on a retrospective basis. See Note 15, Segment Reporting, for the Company’s disclosures on its reportable segment which incorporates the disclosure requirements of this ASU.

Recent accounting pronouncements: In May 2025, the Financial Accounting Standards Board(“FASB”) issued Accounting Standards Update (“ASU”) 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which provides enhanced comparability of financial statements across entities engaging in acquisition transactions effected primarily by exchanging equity interests when the legal acquiree meets the definition of a business. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within those annual reporting periods. Entities must adopt the changes prospectively to any acquisition transaction that occurs after the initial application date. The Company is currently evaluating the potential effect that this ASU will have on its financial statement disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which provides enhanced language to remove all references to prescriptive and sequential software development stages (referred to as “project stages”) throughout Subtopic 350-40. Therefore, an entity is required to start capitalizing software costs when both of the following occur, 1) management has authorized and committed to funding the software project and 2) it is probable that the project will be completed and the software will be used to perform the function intended. The ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods. Entities must adopt the changes either 1) prospectively, 2) retrospectivelyto any or all prior periods presented in the financial statements, or 3) using a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption after the initial application date. The Company is currently evaluating the potential effect that this ASU will have on its financial statements and disclosures.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606), which provides enhanced language concerning the definition of a derivative and how it should not apply to certain contracts. Therefore, the amendments in this update expand the scope exception for certain contracts not traded on an exchange to include contracts for which settlement is based on operations or activities specific to one of the parties to the contract. This improvement is expected to result in more contracts and embedded features being excluded from the scope of Topic 815. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within those annual reporting periods. Entities must adopt the changes either 1) prospectively, 2) modified retrospectively through a cumulative-effect adjustment to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption for contracts existing as of the beginning of the annual reporting period of adoption. The Company is currently evaluating the potential effect that this ASU will have on its financial statements and disclosures.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815) Hedge Accounting Improvements, which provides clarification on certain aspects of the guidance on hedge accounting and to address several incremental hedge accounting issues arising from the global reference rate reform initiative such as risk assessment for cash flow hedges, forecasted interest payments, nonfinancial forecasted transactions and written options. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within those annual reporting periods. Entities must adopt the changes on a prospective basis for all hedging relationships. An entity may elect to adopt the amendments in this Update for hedging relationships that exist as of the date of adoption. The Company is currently evaluating the potential effect that this ASU will have on its financial statements and disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) Narrow-Scope Improvements, which provides clarification on interim disclosure requirements and the applicability of Topic 270. This improvement is expected to result in a comprehensive list of interim disclosures that are required by GAAP. The objective of the amendments is to provide clarity about the current requirements, rather than evaluate whether to expand or reduce interim disclosure requirements. The ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods. Entities must adopt the changes either 1) prospectively or, 2) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the potential effect that this ASU will have on its financial statements and disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public entities to disclose information about certain costs and expenses. The amendments in this ASU improve financial reporting by requiring additional disclosure of information and specific expense categories in the notes to the financial statements at interim and annual periods. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Entities must adopt the changes either 1) prospectively to financial statements issued for reporting periods after the effective date of this update or 2) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the potential effect that this ASU will have on its financial statement disclosures.

Other recently issued accounting standards or pronouncements have been excluded because they are either not relevant to the Company, or are not expected to have, or did not have, a material effect on its condensed consolidated financial statements.

Note 3. Inventories

Inventories consists of the following as of December 31 (in thousands):

At December 31, 2025 and 2024, no write down of inventory was determined to be necessary.

Note 4. Investment in Convertible Notes

In 2019, the Company purchased$30.0 million in convertible notes bearing interest at 3% per annum from Gold Rush Amusements, Inc. (“Gold Rush”), another terminal operator in Illinois. The convertible notes each included an option to convert the notes to common stock of Gold Rush prior to the maturity date upon written notice from the Company.

On May 31, 2023, the Company and Gold Rush entered into a settlement agreement which resolved any and all lawsuits and all outstanding obligations under the convertible notes. As part of the settlement, the Company received $32.5 million from Gold Rush in June 2023, which included the repayment of the face value of the convertible notes plus accrued interest as well as a $0.4 million prepayment on future amounts due. The Company also recorded a gain of $1.7 million in the second quarter of 2023, which is included in other expenses, net on the consolidated statements of operations and comprehensive income for the year ended December 31, 2023. In addition, the Company recorded a receivable from Gold Rush of $1.5 million as of December 31, 2024, which represented the present value of the remaining $1.5 million due from Gold Rush by May 2025, and was presented within other assets in the consolidated balance sheets. The Company received the remaining$1.5 million due under the settlement agreement in April 2025.

Note 5. Property and Equipment, net

Property and equipment, net consists of the following as of December 31 (in thousands):

(1)Includes properties leased to third parties of $10.0 million and $7.0 million for the years ended December 31, 2025, and 2024, respectively.

Depreciation and amortization of property and equipment was$52.7 million,$44.0 million and$37.9 million during the years ended December 31, 2025,2024 and 2023, respectively.

Long-lived assets, which includes property and equipment, net and other assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. There wereno indicators of impairment of long-lived assets as of December 31, 2025, 2024, or 2023.

Note 6. Route and Customer Acquisition Costs

The Company enters into contracts with third parties and its gaming locations to install and operate gaming terminals. Payments are due when gaming operations commence and then on a periodic basis for a specified period of time thereafter. Gross payments due, based on the number of live locations, were approximately$15.1 million and$11.2 million as of December 31, 2025 and 2024, respectively. Payments are due over varying terms of the individual agreements and are discounted at the Company’s incremental borrowing rate associated with its long-term debt at the time the contract is acquired. The net present value of payments due was$12.7 million and$9.4 million as of December 31, 2025 and 2024, respectively, of which approximately$2.5 million and $2.2 million was included in current liabilities in the accompanying consolidated balance sheets as of both December 31, 2025 and 2024, respectively. The route and customer acquisition cost asset is comprised of upfront payments made on the contracts of$31.2 million and$22.3 million as of December 31, 2025 and 2024, respectively. The Company has upfront payments of commissions paid to the third parties for the acquisition of the customer contracts that are subject to a claw back provision if the customer cancels the contract prior to completion. The payments subject to a claw back were$5.0 million and$1.2 million as of December 31, 2025 and 2024, respectively.

Route and customer acquisition costs consist of the following as of December 31 (in thousands):

Estimated amortization expense related to route and customer acquisition costs for the next five years and thereafter is as follows (in thousands):

Amortization expense of route and customer acquisition costs was $2.8 million, $2.3 million and $1.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Note 7. Location Contracts Acquired

Location contracts acquired in business acquisitions consist of the following as of December 31 (in thousands):

Estimated amortization expense related to location contracts acquired for the next five years and thereafter is as follows (in thousands):

Amortization expense of location contracts acquired was$20.3 million,$17.9 million and$17.1 million during the years ended December 31, 2025,2024 and 2023, respectively.

Location contracts are tested for impairment when triggering events occur. There wereno indicators of impairment of location contracts as of December 31, 2025, 2024, or 2023.

Note 8. Goodwill and Other Intangible Assets

The Company had goodwill of $114.4 million as of December 31, 2025, of which $28.1 million is deductible for tax purposes.

The following are the Company’s acquisitions for theyears ended December 31, 2025 and 2024, that resulted in the recording of goodwill. See Note 10, Business and Asset Acquisitions, for more information on how the amount of goodwill for the respective acquisitions was calculated.

On December 2, 2024, the Company acquired Fairmount Park - Casino & Racing (“Fairmount”) for total stock consideration of $40.5 million, of which $12.0 million was initially recorded as goodwill. In July 2025, there was a reduction in goodwill related to the acquisition of Fairmount due to the cancellation of 173,262 previously-issued shares that were being held in escrow due to revisions to the closing statement. The cancellation of these shares resulted in a $2.0 million reduction in the fair value of the consideration paid to acquire Fairmount. As such, total goodwill related to the Fairmount acquisition was reduced to $10.0 million.

On November 1, 2024, the Company completed its acquisition of Toucan Gaming, a distributed gaming operator in the state of Louisiana, for total cash consideration of $41.6 million, of which $2.1 million was initially recorded as goodwill. In November 2025, there was an increase in goodwill related to the acquisition of Toucan Gaming due to working capital adjustments. These adjustments resulted in $0.2 million increase in the fair value of the consideration paid to acquire Toucan. As such, total goodwill related to the Toucan Gaming acquisition increased to $2.3 million.

On September 19, 2024, the Company completed its acquisition of Lucky 7’s Beverages, LLC (“Lucky 7s”), a hospitality location in Billings, Montana, for a total purchase price of $0.8 million, of which $0.1 million was recorded as goodwill.

On September 19, 2024, the Company completed its acquisition of 24th Street Station Casino (“24th Street Station”), a hospitality location in Billings, Montana, for a total purchase price of $0.8 million, of which $0.1 million was recorded as goodwill.

On June 26, 2024, the Company acquired BRM Services, Inc. (“Jorgenson’s Lounge”), a hospitality location in Helena, Montana, for a total purchase price of $1.1 million, of which $0.3 million was recorded as goodwill.

The following is a roll forward of the Company's goodwill (in thousands):

The Company conducted its annual goodwill impairment test on October 1, 2025. The Company conducted a qualitative assessment to determine whether it is more likely than not that the goodwill was impaired. Under the qualitative assessment, the Company considered both positive and negative factors, including macroeconomic conditions, industry events, and financial performance, to make a determination of whether it is more likely than not that the fair value of the goodwill is less than its carrying amount. In performing this assessment, the Company considered such factors as its historical performance, its growth opportunities in existing markets; new markets and new products in determining whether the goodwill was impaired. The Company also referenced its forecasts of revenue, operating income, and capital expenditures and concluded it is more likely than not, that the carrying value of its goodwill was not impaired as of October 1, 2025.

Other intangible assets

Other intangible assets, net consist of definite-lived trade names, customer relationships, software applications and indefinite-lived operating licenses. The Company determines the fair value of trade name assets acquired in acquisitions using a relief from royalty valuation method which requires assumptions such as projected revenue and a royalty rate. Customer relationships, software applications and trade names are amortized over their estimated 7 to 20-year useful lives. Operating licenses were assigned an indefinite useful life based on the Company's expected use of the licenses and determined that no legal, regulatory, contractual, competitive, economic, or other factors limit the useful life of these operating licenses.

Other intangible assets, net consist of the following as of December 31 (in thousands):

(1)Included in accumulated amortization is an impairment charge of $0.8 millionon the customer relationships intangible related to the surrender of the Company’s manufacturing license in Louisiana on October 31, 2024 due to the acquisition of Toucan Gaming. The impairment charge isrecorded within Other expenses, net on consolidated statement of operations and comprehensive income.

Amortization expense of other intangible assets, net was$2.3 million, $2.4 million and $2.4 million for theyears ended December 31, 2025, 2024 and 2023 respectively. The Company’s estimated annual amortization expense relating to other intangible assets over the next five years is $2.3 million.

In May 2025, a one-time payment of $9.5 million was required to open the casino at Fairmount. This payment, which represents a one-time gaming license fee to register the gaming positions in the casino, was recorded as an indefinite-lived operating license.

Indefinite-lived intangibles are tested for impairment annually or when triggering events occur. There wereno indicators of impairment of indefinite-lived intangibles as of December 31, 2025.

Note 9. Debt

The Company’s debt as of December 31, consisted of the following (in thousands):

Prior Credit Facility

On November 13, 2019, the Company entered into a credit agreement (as amended, the “Prior Credit Facility”) as borrower, the Company and its wholly-owned domestic subsidiaries, as a guarantor, the banks, financial institutions and other lending institutions from time to time party thereto, as lenders, the other parties from time to time party thereto and Capital One, National Association, as administrative agent (in such capacity, the “Agent”), collateral agent, issuing bank and swingline lender.

The Prior Credit Facility provided for a:

•$150.0 million revolving credit facility,

•$350.0 million term loan facility, and

•$400.0 million delayed draw term (“DDTL”) loan facility.

The Company’s ability to borrow on the DDTL ended on October 22, 2024 and the maturity date of the Prior Credit Facility was October 22, 2026.

Borrowings under the Prior Credit Facility bore interest, at the Company’s option, at a rate per annum equal to either (a) the Adjusted Term SOFR (which cannot be less than 0.5%) for interest periods of 1, 2, 3 or 6 months (or if consented to by (i) each applicable lender, 12 months or any period shorter than 1 month or (ii) the administrative agent, a shorter period necessary to ensure that the end of the relevant interest period would coincide with any required amortization payment) plus the applicable SOFR margin or (b) the alternative base rate (“ABR”) plus the applicable ABR margin. ABR is a fluctuating rate per annum equal to the highest of (i) the Federal Funds Effective Rate plus 1/2 of 1.0%, (ii) the prime rate announced from time to time by Capital One, National Association or (iii) SOFR for a 1-month interest period on such day plus 1.0%.

Interest was payable quarterly in arrears for ABR loans, at the end of the applicable interest period for SOFR loans (but not less frequently than quarterly) and upon the prepayment or maturity of the underlying loans. The Company was required to pay a commitment fee quarterly in arrears in respect of unused commitments under the revolving credit facility and the additional term loan facility.

The applicable SOFR and ABR margins and the commitment fee rate were calculated based upon the first lien net leverage ratio of the Company and its restricted subsidiaries on a consolidated basis, as defined in the Prior Credit Facility. The revolving loans and term loans bore interest at either (a) ABR (150 bps floor) plus a margin up to 1.75% or (b) SOFR (50 bps floor) plus a margin up to 2.75%, at the option of the Company.

The term loans and the DDTL amortized at an annual rate equal to 5.00% per annum. Upon the consummation of certain non-ordinary course asset sales, the Company was required to apply the net cash proceeds thereof to prepay outstanding term loans and additional term loans. The loans under the Prior Credit Facility may be prepaid without premium or penalty, subject to customary SOFR “breakage” costs.

In addition, the Prior Credit Facility required the Company to maintain (a) a ratio of consolidated first lien net debt to consolidated EBITDA no greater than 4.50 to 1.00 and (b) a ratio of consolidated EBITDA to consolidated fixed charges no less than 1.20 to 1.00, in each case, tested as of the last day of each full fiscal quarter ending after the closing date and determined on the basis of the four most recently ended fiscal quarters of the Company for which financial statements have been delivered pursuant to the Prior Credit Facility, subject to customary “equity cure” rights.

New Credit Facility

In order to refinance its Prior Credit Facility, the Company entered into a credit agreement, dated as of September 10, 2025(the “New Credit Facility”), by and among the Company, Accel Entertainment LLC (the “Borrower”), the lenders from time to time party thereto, CIBC Bank USA, as administrative agent and collateral agent for the lenders and lead arranger, Fifth Third Bank, National Association, JPMorgan Chase Bank, N.A., U.S. Bank National Association, and Truist Securities, Inc., as joint lead arrangers, and Bank of America, N.A. as documentation agent.

The New Credit Facility provides for a:

•$300.0 million revolving credit facility, including a letter of credit facility with a $15.0 million sublimit and a swing line facility with a $25.0 million sublimit, and

•$600.0 million term loan facility.

The maturity date of the New Credit Facility is September 10, 2030.

Proceeds of the initial borrowings under the New Credit Facility were used to repay in full all outstanding indebtedness and terminate all commitments under the Company’s Prior Credit Facility.

The Company incurred $4.1 million of debt issuance costs related to the New Credit Facility, of which $3.8 million are being amortized over the life of the New Credit Facility. The Company also recognized a loss on debt extinguishment of $1.1 million due to the partial extinguishment associated with a lender whose borrowing capacity decreased and the complete extinguishment for those lenders who are no longer participating.

The obligations of the Borrower under the New Credit Facility are (i) guaranteed by the Company and each of the Borrower’s existing and future material domestic subsidiaries and (ii) secured by a first-priority lien on substantially all of the assets of the Company, as well as substantially all of the assets of the Borrower and the Borrower’s existing and future material domestic subsidiaries, in each case subject to certain customary exceptions set forth in the New Credit Facility.

At the Borrower’s election, borrowings under the New Credit Facility bear interest at either (i)a base rate equal to the highest of (a) the federal funds effective rate plus 0.5%, (b) the prime rate announced by CIBC Bank USA, or (c) 1-month Term Secured Overnight Financing Rate (“Term SOFR”) plus 1% or (ii) Term SOFR for an applicable interest period, in each case plus an applicable margin. The applicable margin is determined by reference to the Borrower’s First Lien Net Leverage Ratio (as defined in the New Credit Facility) and ranges from (i)0.75% to 1.75% for base rate borrowings and (ii)1.5% to 2.5% for Term SOFR borrowings. As of December 31, 2025, the weighted-average interest rate on the Company’s borrowings was approximately 6.3%.

The New Credit Facility contains customary affirmative and negative covenants including limitations on the ability of the Company, the Borrower, and their restricted subsidiaries to, amongst other things, grant additional liens, incur additional indebtedness, merge or consolidate, dispose of assets, engage in certain transactions with affiliates, and make restricted payments.

The New Credit Facility also requires the Borrower to maintain, as of the last day of each fiscal quarter, (i) a First Lien Net Leverage Ratio (as defined in the New Credit Facility) no greater than 4.75 to 1.00 and (ii) a Fixed Charge Coverage Ratio (as defined in the New Credit Facility) of at least 1.20 to 1.00. The New Credit Facility includes customary events of default, the occurrence of which could permit the administrative agent to, amongst other things, declare all amounts owing under the credit facilities to be immediately due and payable, exercise remedies with respect to the collateral, and terminate the lenders’ commitments thereunder. The failure to pay certain amounts owing under the New Credit Facility may result in an increase in the interest rate applicable thereto.

If an event of default (as such term is defined in the New Credit Facility) occurs, the lenders would be entitled to take various actions, including the acceleration of amounts due under the New Credit Facility, termination of the lenders’ commitments thereunder, foreclosure on collateral, and all other remedial actions available to a secured creditor. The failure to pay certain amounts owing under the New Credit Facility may result in an increase in the interest rate applicable thereto. The principal maturities of total debt are as follows (in thousands):

As previously mentioned in Note 2, the Company recorded temporary equity associated with aredeemable noncontrolling interest at its carrying value. If certain criteria are met, the non-controlling interest would be revalued to its estimated redemption value. The Company has excluded any amounts associated with this noncontrolling interest from the table above as the Company is uncertain as to the timing and the ultimate amount of the potential payment it may be required to make.

As of December 31, 2025, the Company had an outstanding principal payment of $7.5 million which was supposed to be timely withdrawn by the lender on December 31, 2025. The Company notified the lender of this clerical error and the $7.5 million payment was drawn by the lender on January 2, 2026.

The fair value of the Company’s debt as of December 31, 2025 and 2024, was estimated usinga discounted cash flow model, which forecasts future interest and principal payments. The forecasted cash flows were discounted back to present value using the term-matched risk-free rate plus an option adjusted spread to account for credit risk. The option adjusted spread was calculated as of the debt's issuance date and then adjusted to the valuation date. The inputs used to determine the fair value were classified as Level 2 in the fair value hierarchyas defined in Note 12.

The carrying value and estimated fair value of the Company's debt as of December 31, was as follows (in thousands):

Other Financing Activities

From time to time, the Company may take advantage of favorable financing terms offered by vendors for purchases of property and equipment. Financed property and equipment totaled$4.8 million and $0.6 millionas of December 31, 2025 and 2024, respectively, of which $1.7 million and less than $0.1 million is recorded in accounts payable and other accrued expenses with the remaining $3.1 million and$0.5 million recorded in other long-term liabilities on the consolidated balance sheets for theyears ended December 31, 2025, and 2024, respectively.

Interest rate caplets

The Company manages its exposure to some of its interest rate risk through the use of interest rate caplets, which are derivative financial instruments. On January 12, 2022, the Company hedged the variability of the cash flows attributable to the changes in the 1-month SOFR interest rates on the first $300 million of the term loan under our Prior Credit Facility by entering into a 4-year series of 48 deferred premium caplets (“caplets”), which remain in effect under the New Credit Facility and expired in January 2026.

The Company recognized an unrealized loss on the change in fair value of the interest rate caplets of$4.0 million, $3.8 million, and $4.3 million, net of income taxes, for the years ended December 31, 2025,2024, and 2023 respectively. For more information on how the Company determines the fair value of the caplets, see Note 12. The Company also recognized interest income on the caplets of$6.9 million, $9.8 million, and $9.2 million for the years ended December 31, 2025, 2024, and 2023 respectively, which is reflected in interest expense, netin the consolidated statements of operations and other comprehensive income.

On January 30, 2026, the Company continued tohedge the variability of the cash flows attributable to the changes in the 1-month Term SOFR interest rate by entering intoan interest rate collar. The collar, which is designated as a cash flow hedge, establishes a cap interest rate of 4.00% and a floor interest rate of 2.9215%. The interest‑rate collar is structured so its notional amount and timing exactly match the term loan’s outstanding balance and scheduled principal payments. The interest rate collar matures in September 2029.

Note 10. Business and Asset Acquisitions

2025 Business Acquisitions

Dynasty Games

On December 1, 2025, the Company acquired Dynasty Games (“Dynasty”), a Nevada based operator and owner of multiple licensed video poker establishments, for a total purchase price of $4.3 million, which included i) $4.0 million paid in cash at closing and ii) $0.3 million deposited in escrow that is tied to contingent liability with an estimated fair value of $0.3 million. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The purchase price was allocated to the following assets: i) gaming equipment totaling $0.3 million, ii) vehicles totaling less than $0.1 million, iii) inventory totaling less than $0.1 million, iv) furniture & fixtures totaling less than $0.1 million, v) location contracts totaling $3.8 million, and vi) contingent liability totaling $0.3 million. The results of operations for Dynasty are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

2024 Business Acquisitions

Randy’s

On December 23, 2024, the Company completed its acquisition of certain assets of Randy’s Vending (“Randy’s”), an Illinois-based operator, for a total consideration transferred of $0.3 million, which included i) $0.1 million in cash at closing and ii) contingent purchase consideration with an estimated fair value of $0.2 million. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The purchase price was allocated to the following assets: i) amusement equipment totaling less than $0.1 million, and ii) location contracts totaling $0.2 million. The results of operations for Randy’s are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Fairmount

On December 2, 2024, the Company completed its acquisition of Fairmount in Collinsville, Illinois, for total stock consideration of approximately$40.5 million. Consideration transferred was approximately 3.5 million shares of the Company’s Class A-1 common stock and the value was based on a prior twenty-day trailing weighted average close price. The acquisition was accounted for as a business combination in accordance with Topic 805. The purchase price was preliminarily allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based upon their estimated fair values. The excess of the purchase price over the tangible and intangible assets acquired and liabilities assumed of $12.0 million was initially recorded as goodwill. The Fairmount acquisition resulted in recorded goodwill as a result of a higher consideration paid driven by the maturity of Fairmount’s operations, industry and workforce. While management has integrated certain operations of Fairmount into its existing business structure, Fairmount is its own operating segment, casino and racing.

In July 2025, there was a reduction in goodwill related to the acquisition of Fairmount due to the cancellation of 173,262 previously-issued shares that were being held in escrow due to revisions to the closing statement. The cancellation of these shares resulted in a $2.0 million reduction in the fair value of the consideration paid to acquire Fairmount. As such, total goodwill related to Fairmount decreased to $10.0 million.

The following table summarizes the fair value of consideration transferred and the fair values of the assets acquired and liabilities assumed (in thousands):

The Company incurred $1.8 million in acquisition related costs that are included in other expenses, net within the consolidated statements of operations and comprehensive income for the year ended December 31, 2024.

The results of operations for Fairmount are included in the consolidated financial statements of the Company from the date of acquisition. Fairmount'sacquired assets generated revenues and net income of $1.4 million and less than $0.1 million for the year ended December 31, 2024. The unaudited pro forma revenue and net income of Fairmount, as if this acquisition had occurred as of the beginning of the fiscal year prior to the fiscal year of acquisition, is not material to the consolidated results of the Company for the years ended December 31, 2024 and 2023.

Bayou

On November 21, 2024, the Company completed its acquisition of Bayou Gaming, Inc. (“Bayou”), a Louisiana-based operator and owner of multiple licensed video poker establishments, for a total purchase price of $0.5 million, which the Company paid in cash at closing. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The purchase price was allocated to the following assets: i) gaming and amusement equipment totaling $0.1 million, and ii) location contracts totaling $0.4 million. The results of operations for Bayou are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Pelican

On November 21, 2024, the Company completed its acquisition of Pelican State Gaming, Inc. (“Pelican”), a Louisiana-based operator and owner of multiple licensed video poker establishments, for a total consideration of $1.8 million, which included i) $1.5 million paid in cash at closing and ii) contingent purchase consideration with an estimated fair value of $0.3 million. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The purchase price was allocated to the following assets: i) gaming and amusement assets totaling $0.3 million, and ii) location contracts totaling $1.5 million. The results of operations for Pelican are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Xtreme

On November 1, 2024, the Company completed its acquisition of certain assets of Xtreme ATM of Louisiana LLC, (“Xtreme”) for a total purchase price of $1.5 million, which the Company paid in cash at closing. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The purchase price was allocated to the following assets: i) location contract assets totaling $1.4 million, and ii) redemption equipment totaling less than $0.1 million. The results of operations for Xtreme are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Toucan Gaming

On November 1, 2024, the Company completed its acquisition of 85% ownership of Toucan Gaming for a total cash consideration of $41.6 million, of which $38.3 million was paid in cash (of which $4.6 million was paid in the prior year as an advance on the purchase price) and the remaining $3.3 million was recorded as consideration payable. The acquisition was accounted for as a business combination in accordance with Topic 805. The purchase price was preliminarily allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based upon their estimated fair values. The excess of the purchase price over the tangible and intangible assets acquired and liabilities assumed of $2.1 million was initially recorded as goodwill. The Toucan Gaming acquisition resulted in recorded goodwill as a result of a higher consideration paid driven by the maturity and quality of Toucan Gaming’s operations, industry and workforce. Management integrated Toucan Gaming into its existing business structure, which is comprised of a single reporting unit. In November 2025, there was an increase in goodwill related to the acquisition of Toucan Gaming due to working capital adjustments. These adjustments resulted in $0.2 million increase in the fair value of the consideration paid to acquire Toucan. As such, total goodwill related to the Toucan Gaming acquisition increased to $2.3 million.

The following table summarizes the fair value of consideration transferred and the fair values of the assets acquired and liabilities assumed (in thousands):

The Company incurred $0.3 million in acquisition related costs that are included in other expenses, net within the consolidated statements of operations and comprehensive income for the year ended December 31, 2024.

The results of operations for Toucan Gaming are included in the consolidated financial statements of the Company from the date of acquisition. Toucan Gaming'sacquired assets generated revenues and net income of $5.4 million and $0.3 million for the year ended December 31, 2024. The unaudited pro forma revenue and net income of Toucan Gaming, as if this acquisition had occurred as of the beginning of the fiscal year prior to the fiscal year of acquisition, is not material to the consolidated results of the Company for the years ended December 31, 2024 and 2023.

24th Street Station

On September 19, 2024, the Company completed its acquisition of 24th Street Station, a retail establishment in Montana, for a total purchase price of $0.8 million, which the Company paid in cash at closing. The acquisition was accounted for as a business combination in accordance with Topic 805. The purchase price was allocated to the following assets: i) indefinite-lived intangible assets totaling $0.7 million, and ii) goodwill totaling $0.1 million. The results of operations for the 24th Street Station are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Lucky 7s

On September 19, 2024, the Company completed its acquisition of Lucky 7s, a retail establishment in Montana, for a total purchase price of $0.8 million, which the Company paid in cash at closing. The acquisition was accounted for as a business combination in accordance with Topic 805. The purchase price was allocated to the following assets: i) indefinite-lived intangible assets totaling $0.7 million, and ii) goodwill totaling $0.1 million. The results of operations for Lucky 7s are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Jorgenson’s Lounge

On June 26, 2024, the Company acquired Jorgenson’s Lounge, a retail establishment in Montana, for a total purchase price of $1.1 million, which the Company paid in cash at closing. The acquisition was accounted for as a business combination in accordance with Topic 805. The purchase price was allocated to the following assets: i) indefinite-lived intangible assets totaling $0.8 million, and ii) goodwill totaling $0.3 million. The results of operations for Jorgenson’s Lounge are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Illinois Gaming Entertainment

On May 1, 2024, the Company acquired certain assets of Illinois Gaming Entertainment LLC (“IGE”), an Illinois-based terminal operator. The Company acquired 16 operational locations, as well as gaming equipment. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The aggregate purchase consideration transferred totaled $13.5 million, which included i) $11.4 million in cash at closing and ii) contingent purchase consideration with an estimated fair value of $2.1 million. The contingent purchase consideration represents three installments of $0.6 million which are due on the first, second and third anniversary of the acquisition with $0.7 million due on the fourth anniversary of the acquisition. All payments are subject to the acquired locations still being in operation on the respective anniversary dates. The first installment of $0.6 million was made in May 2025. The present value of the consideration payable was $2.2 million as of September 30, 2024 and is recorded in consideration payable on the consolidated balance sheets. The aggregate purchase consideration of $13.5 million was allocated to the following assets: i) location contracts totaling $11.6 million, ii) gaming equipment totaling $1.6 million, and iii) redemption equipment totaling $0.3 million. The results of operations for IGE are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Great Lakes Vending

On February 22, 2024, the Company acquired certain assets of Great Lakes Vending Corporation (“GLV”), an Illinois-based terminal operator. The Company acquiredone operational location, as well as gaming and redemption terminal equipment. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The total purchase price was approximately $1.3 million, which the Company paid in cash at closing. The total purchase price of $1.3 million was allocated to the following assets: i) location contracts totaling $1.2 million and ii) gaming and redemption equipment totaling $0.1 million. The results of operations for GLV are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Doc & Eddy’s

On January 10, 2024, the Company acquired Doc & Eddy’s West (“D&E”), a hospitality operation in Montana. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The total purchase price was approximately $2.3 million, which the Company paid in cash at closing, and was allocated to the following assets: i) buildings totaling $1.0 million, ii) indefinite long-lived assets totaling $0.9 million and iii) land totaling $0.4 million. The results of operations for D&E are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

2023 Business Acquisitions

Illinois Video Slot Management

On December 27, 2023, the Company acquired certain assets of Illinois Video Slot Management Corp. (“IVSM”), an Illinois-based terminal operator. The Company acquired a gaming location, as well as gaming equipment. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The total purchase price was approximately $1.0 million, of which the Company paid $0.7 million in cash at closing. The remaining $0.3 million of consideration is payable inthree installments of $0.1 million which are due on the first, second and third anniversary of the acquisition assuming the location is still in operation. The total purchase price of $1.0 million was allocated to the following assets: i) a location contract totaling $0.9 million and ii) gaming equipment totaling $0.1 million. The results of operations for the IVSM acquisition is included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Illinois Gaming Entertainment

On May 23, 2023, the Company acquired certain assets of Illinois Gaming Entertainment LLC (“IGE”), an Illinois-based terminal operator. The Company acquired four operational locations, as well as gaming equipment. The acquisition was accounted for as an asset acquisition in accordance with Topic 805. The total purchase price was approximately $1.5 million, which the Company paid in cash at closing. The total purchase price of $1.5 million was allocated to the following assets: i) location contracts totaling $1.1 million and ii) gaming equipment totaling $0.4 million.

On October 3, 2023, the Company acquired an additional three operational locations, as well as gaming equipment, from IGE. This acquisition was also accounted for as an asset acquisition in accordance with Topic 805. The total purchase price was $2.3 million, which the Company paid in cash at closing. The total purchase price of $2.3 million was allocated to the following assets: i) location contracts totaling $2.0 million and ii) gaming equipment totaling $0.3 million.

The results of operations for both IGE acquisitions are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Rendezvous

On February 13, 2023, the Company acquired Rendezvous, a hospitality operation in Billings, Montana. The hospitality operation is set to be a Century-vended location. The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with Topic 805. The total purchase price of $2.6 million was paid in cash at closing and was allocated to the following assets: i) indefinite-lived intangible assets totaling $0.8 million; ii) land totaling $0.5 million; iii) buildings totaling $0.4 million; iv) gaming equipment totaling $0.1 million, and v) goodwill totaling $0.8 million. The results of operations for Rendezvous are included in the consolidated financial statements of the Company from the date of acquisition and were not material.

Consideration Payable

The Company has a contingent consideration payable related to certain locations, as defined, in each respective acquisition agreement which are placed into operation during a specified period after the acquisition date. The fair value of contingent consideration is included in the consideration payable on the consolidated balance sheets as of December 31, 2025 and 2024. The contingent consideration accrued is measured at fair value on a recurring basis. Payments related to consideration payable were$2.7 million for the year ended December 31, 2025.

Current and long-term portions of consideration payable consist of the following as of December 31 (in thousands):

• Acquisitions that occurred prior to 2023.

Note 11. Contingent Earnout Share Liability

Pursuant to the terms of the Company’s Amended and Restated Certificate of Incorporation, the Company authorized and has available for issuance 10,000,000 shares of Class A-2 common stock. The holders of the Class A-2 common stock do not have voting rights and are not entitled to receive or participate in any dividends or distributions when and if declared from time to time. The Company concluded that the Class A-2 common stock should be reflected as a contingent earnout share liability due to the fact that such shares are not entitled to dividends, voting rights, or a stake in the Company in the case of liquidation. The contingent earnout share liability is recorded at fair value. For more information on how the fair value is determined, see Note 12.

In 2019,5,000,000 shares of Class A-2 common stock were issued, subject to the conditions set forth in a restricted stock agreement (the “Restricted Stock Agreement”), which sets forth the terms upon which the Class A-2 common stock will be exchanged for an equal number of validly issued, fully paid and non-assessable Class A-1 common stock. The exchange of Class A-2 common stock for Class A-1 common stock will be subject to the terms and conditions set forth in the Restricted Stock Agreement, with such exchanges occurring inthree separate tranches upon the satisfaction of the specified triggers, based on the closing sale price of Class A-1 common stock exceeding certain prices over certain trading periods.

In 2020, the market condition for the settlement of Tranche I was satisfied. As a result,1,666,636 shares of the 1,666,666 shares of Class A-2 common stock were converted into Class A-1 common stock.

The market conditions for the remaining two tranches are as follows:

•Tranche II, equal to 1,666,667 shares of Class A-2 common stock, will be exchanged for Class A-1 common stock if the closing sale price of Class A-1 common stock on the New York Stock Exchange (“NYSE”) equals or exceeds $14.00 for at least twenty trading days in any consecutive thirty trading day period; and

•Tranche III, equal to 1,666,667 shares of Class A-2 common stock, will be exchanged for Class A-1 common stock if the closing sale price of Class A-1 common stock on the NYSE equals or exceeds $16.00 for at least twenty trading days in any consecutive thirty trading day period.

Note 12. Fair Value Measurements

ASC Topic 820, Fair Value Measurements and Disclosures, establishes a framework for measuring fair value and the corresponding disclosure requirements around fair value measurements. This topic applies to all financial instruments that are being measured and reported on a fair value basis.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, various methods, including market, income and cost approaches, are used. Based on these approaches, certain assumptions are utilized that the market participants would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable inputs. Valuation techniques are utilized that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on the observability of the inputs used in the valuation techniques, it is required to provide information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:

Level 1: Valuations for assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. Level 1 also includes U.S. Treasury and federal agency securities and federal agency mortgage-backed securities, which are traded by dealers or brokers in active markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities.

Level 2: Valuations for assets and liabilities traded in less active dealer or broker markets or for similar assets or liabilities in active markets.

Level 3: Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer, or broker traded transactions. Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.

Assets measured at fair value

The following tables summarize the Company’s assets that are measured at fair value on a recurring basis (in thousands):

Interest rate caplets

The Company determines the fair value of the interest rate caplets using quotes that are based on models whose inputs are observable SOFR forward interest rate curves. The valuation of the interest rate caplets is considered to be a Level 2 fair value measurement as the significant inputs are observable. Unrealized changes in the fair value of interest rate caplets are classified within other comprehensive income on the accompanying consolidated statements of operations and comprehensive income. Realized gains on the interest rate caplets are recorded to interest expense, net on the accompanying consolidated statements of operations and comprehensive income and included within cash payments for interest, net on the consolidated statements of cash flow.

Liabilities measured at fair value

The following tables summarize the Company’s liabilities that are measured at fair value on a recurring basis (in thousands):

Contingent consideration

The Company uses a discounted cash flow analysis to determine the value of contingent consideration upon acquisition and updates this estimate on a recurring basis. The significant assumptions in the Company's cash flow analysis includes the probability adjusted projected revenues after state taxes, a discount rate as applicable to each acquisition, and the estimated number of locations that “go live” with the Company during the contingent consideration period. The valuation of the Company's contingent consideration is considered to be a Level 3 fair value measurement as the significant inputs are unobservable and require significant judgment or estimation. Changes in the fair value of contingent consideration liabilities are classified within other expenses, net on the accompanying consolidated statements of operations and comprehensive income.

Contingent earnout shares

The Company determined the fair value of the contingent earnout shares based on the market price of the Company's A-1 common stock. The liability, by tranche, is then stated at present value based on i) an interest rate derived from the Company's borrowing rate and the applicable risk-free rate and ii) an estimate on when it expects the contingent earnout shares to convert to A-1 common stock. The valuation of the Company's contingent earnout sharesis considered to be a Level 2 fair value measurement. Changes in the fair value of contingent earnout shares are included within loss on change in fair value of contingent earnout shares on the accompanying consolidated statements of operations and comprehensive income.

Warrants

The Company’s 5,144 warrants expired in November 2024. The liability for warrants was included in other long-term liabilities on the consolidated balance sheets and was considered to be a Level 2 fair value measurement. Upon expiration of the warrants, the Company reduced the fair valueof the warrantsto zero and recognized a gain on the expiration of warrants of less than $0.1 millionon the consolidated statements of operations and comprehensive income.

The following table provides a roll-forward of the fair value of recurring Level 3 fair value measurements for liabilities for the years ended December 31, (in thousands):

There were no transfers in or out of Level 3 assets or liabilities for the periods presented.

Note 13. Leases

The Company's lease portfolio has both operating and finance leases but is primarily comprised of operating leases for buildings and vehicles. The Company's leases have remaining lease terms that range from less than 1 to 11 years, some of which also include options to extend or terminate the lease. Most leases contain both fixed and variable payments. Variable costs consist primarily of rent escalations based on an established index or rate and taxes, insurance, and common area or other maintenance costs, which are paid based on actual costs incurred by the lessor.

Lease expense for the years ended December 31 included within general and administrative expenses in the consolidated statements of operations and comprehensive income is as follows (in thousands):

Total expense related to finance leases was $0.3 million, $0.3 million, and less than $0.1 million for the years ended December 31, 2025, 2024, and 2023 respectively.

Amounts recognized in the consolidated balance sheets related to the Company's lease portfolio as of December 31 are as follows (in thousands):

As of December 31, 2025, the future undiscounted cash flows associated with the Company's lease liabilities were as follows (in thousands):

The weighted average remaining lease term and discount rate used in computing the lease liabilities as of December 31 were as follows:

Supplemental cash flow information related to leases for the years ended December 31 is as follows (in thousands):

The Company also leases space to third-party tenants under operating leases primarily for retail and food and beverage outlets. The Company recognized lease revenue of $0.4 million, and less than $0.1 million, for the years ended December 31, 2025, and 2024. There wasno rental revenue for the year ended December 31, 2023. Lease revenue is recorded within ATM fees and other in the consolidated statements of operations and comprehensive income. The costs and accumulated depreciation of the buildings and land associated with these leases is included in property and equipment, net on the consolidated balance sheets.

Note 14. Stockholders’ Equity

Pursuant to the terms of the Company’s Amended and Restated Certificate of Incorporation, the Company authorized and has available for issuance the following shares:

Class A-1 Common Stock

The holders of the Class A-1 common stock are entitled toone vote for each share. The holders of Class A-1 common stock are entitled to receive dividends or other distributions when and if declared from time to time and share equally on a per share basis in such dividends and distributions subject to such rights of the holders of preferred stock.

Treasury Stock

On November 22, 2021, the Company’s Board of Directors (“Board”) approved a share repurchase program of up to $200 million shares of Class A-1 common stock. On February 27, 2025, the Board approved an amendment to the share repurchase program to replenish the dollar amount that may be purchased under the program back to up to $200 million shares of Class A-1 common stock (as amended, the “share repurchase program”). The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities. Under the share repurchase program, repurchases can be made from time to time using a variety of methods, including open market purchases or privately negotiated transactions, in compliance with the rules of the SEC and other applicable legal requirements. The share repurchase program does not obligate the Company to acquire any particular amount of shares, and the share repurchase program may be suspended or discontinued at any time at the Company’s discretion. As of December 31, 2025, the Company has purchased a total of 17.6 million shares under the share repurchase program at a total purchase price of$183.4 million, of which 3.8 million shares at a total purchase price of$39.9 million were acquired during the year ended December 31, 2025.

In December 2024, the Company re-issued 3.1 million shares of treasury stock to complete the Fairmount acquisition at an average cost per share of $11.58. The difference between the average cost per share and the fair value of the shares issued resulted in a gain of $4.1 million, which was recorded to additional paid-in-capital on the consolidated balance sheets. In July 2025,173,262 previously-issued shares that were being held in escrow were canceled due to revisions to the closing statement. The cancellation of these shares resulted in a loss of $2.0 million, which was recorded to additional paid-in-capital on the consolidated balance sheets.

As of December 31, 2025 and 2024, the Company has reserved Class A-1 common stock for future issuance in relation to the following:

Note 15. Segment Reporting

The Company assesses its reportable segments on an annual basis or as changes in its business occur. As part of its assessment, the Company has determined its chief operating decision maker (“CODM”) to be its Chief Executive Officer, Andrew Rubenstein, who is ultimately responsible for the operating performance of the Company and the allocation of resources. The CODM assesses financial performance and allocates resources based on Adjusted EBITDA. Adjusted EBITDA is used by the CODM to understand the Company’s underlying drivers of profitability, trends in its business, and to facilitate company-to-company and period-to-period comparisons. Segment asset information is provided to the CODM to support the CODM’s assessment of performance but is not used to allocate resources.

The Company defines Adjusted EBITDA as net income plus:

•Amortization of intangible assets and route and customer acquisition costs

•Stock-based compensation expense

•Loss from unconsolidated affiliates

•Loss on change in fair value of contingent earnout shares

•Gain on expiration of warrants

•Other expenses, net which consists of i) non-cash expenses including the remeasurement of contingent consideration liabilities, ii) non-recurring lobbying and legal expenses related to distributed gaming expansion in current or prospective markets, and iii) other non-recurring expenses

•Depreciation and amortization of property and equipment

•Interest expense, net

•Emerging markets, which reflects the results, on an Adjusted EBITDA basis, for non-core jurisdictions where the Company’s operations are developing

•Income tax expense

•Loss on debt extinguishment

The Company’s distributed gaming reportable segment consists of the installation, maintenance, and operation of gaming terminals, redemption devices that disburse winnings and contain ATM functionality, and other amusement devices in authorized non-casino locations such as restaurants, bars, convenience stores, liquor stores, truck stops, and grocery stores. The Company’s operations and services are consistent in the Company’s markets.

The Company has determined that with the acquisition of Fairmount in December of 2024, it hastwo operating segments: distributed gaming and casino and racing as of December 31, 2025. However, the casino and racing operating segment does not meet the criteria of a reportable segment primarily from a quantitative standpoint as of December 31, 2025. The Company will continue to evaluate from a quantitative and qualitative standpoint whether the casino and racing operating segment meets the criteria of a reportable segment.

Significant segment expenses, including disaggregated significant expenses that are presented within general and administrative expenses, are presented in the Company’s consolidated statement of operations and comprehensive income and are included in the table below.

The following table presents financial information with respect to the Company’s single reportable segment, distributed gaming, for the years ended December 31, 2025, 2024, and 2023. Additionally, the Company has included an "all other" operating segment which is its casino and racing business that is neither individually reportable nor able to be aggregated or combined with another operating segment.

(1)Total net revenues is further disaggregated by revenue stream as included on the consolidated statements of operations and comprehensive income.

(2)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(3)Compensation related costs represent payroll and other related costs that are included in general and administrative on the consolidated statements of operations and comprehensive income.

(4)All other segment items include other operating and general and administrative expenses (such as general and administrative expenses related to parts, advertising, information technology, etc.) which are included in general and administrative on the consolidated statements of operations and comprehensive income and cost of manufacturing goods sold, as well as, adjustments for stock-based compensation expense and emerging markets.

(5)All corporate expenses were allocated to the distributed gaming reportable segment as of December 31, 2025. The "all other" operating segment had total net revenues of$35.8 million and $1.4 million; cost of revenues of$13.5 million and $147 thousand; compensation related costs of$11.4 million and $581 thousand in operations and$4.0 million andzero in general and administrative; and all other segment items of$6.9 million and $464 thousand for the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025 the consolidated assets associated with the distributed gaming segment are $1,044.7 million and the assets for the "all other" operating segment are $58.7 million.

See the consolidated financial statements for other financial information (such as cash used for capital expenditures, etc.) regarding the Company’s reportable segment.

Note 16. Cost Associated with Gaming Terminals

Included in cost of revenue are costs associated with the operation of gaming terminals. In each jurisdiction that the Company operates, it is subject to state, municipal and/or administrative fees associated with the operation of its gaming terminals. The taxes and administrative fees are included in cost of revenue in the accompanying consolidated statements of operations and comprehensive income. These costs associated with the operation of gaming terminals totaled$358.7 million,$333.7 million and$312.2 million for the years ended December 31, 2025,2024 and 2023, respectively.

The remaining net terminal income after deducting the taxes and administrative fees described above is split between the Company and the gaming location according to local gaming laws or are prenegotiated. The gaming location's share of net terminal income totaled$503.5 million,$487.2 million and$466.4 million for the years ended December 31, 2025,2024 and 2023, respectively.

Note 17. Employee Benefit Plans

401(k) Plan

The Company maintains a 401(k)-benefit plan for all employees with at least three months of service and have reached 21 years of age. Participants are 100% vested in their contributions. The Company provides an employer match contribution of 50% of the participants’ contribution up to 5% of their eligible compensation. Participants are fully vested in the employer match contribution after one year of employment. The Company may also make profit sharing contributions to the plan which vest 20% a year after the first 2 years of employment and are fully vested after 6 years of employment. The Company may also elect to make other discretionary contributions to the Plan. The Company incurred 401(k)-benefit plan expense of approximately$1.7 million,$1.6 million and$1.5 million for the years ended December 31, 2025,2024 and 2023, respectively.

Multiemployer Benefit Plans

Some of the Company’s employees in its racing operations participate in union-sponsored benefit plans which includes the participation in several multiemployer defined benefit pension plans under terms of a collective bargaining agreement. The Company’s contributions to these plans are determined in accordance with the provisions of the negotiated labor contracts based on the aggregate number of hours worked. The Company’s contributions to these plans for the years ended December 31, 2025 and 2024 were $0.3 million and less than $0.1 million respectively, which represents one month of payments for the year of 2024.

Incentive Compensation Plan

Included in certain employee agreements are provisions for commissions and bonuses, which are determined at the discretion of management. Incentive compensation expense amounted to $13.3 million, $14.7 million and $14.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. Accrued incentive compensation totaled $4.7 million and $5.7 million as of December 31, 2025 and 2024, respectively.

Note 18. Stock-based Compensation

The Company has a Long Term Incentive Plan (as most recently amended and restated in 2025, the “LTIP”) that provides for grants of a variety of stock-based awards to employees and non-employees for providing services to the Company. These awards currently include incentive stock options qualified as such under U.S. federal income tax laws, stock options that do not qualify as incentive stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, cash incentive awards, and other stock-based awards. The Company has reserved a total of 10,000,000 shares of Class A-1 common stock for issuance pursuant to the LTIP, subject to certain adjustments set forth therein.

Stock-based awards are valued on the date of grant and are expensed over the required service period. Total stock-based compensation expense recognized during the years ended December 31, 2025, 2024 and 2023, was $12.2 million, $12.2 million and $9.4 million, respectively. As of December 31, 2025, and 2024, there was approximately $13.8 million and $13.9 million, respectively, of unrecognized compensation expense related to stock-based awards, which is expected to be recognized through 2028.

During the years ended December 31, 2025, 2024 and 2023, the Company recognized gross excess tax expense from stock-based compensation of $0.5 million, $0.1 million, and $0.9 million, respectively. Excess tax benefits reflect the total realized value of the Company’s tax deductions from individual stock option exercise transactions and the vesting of restricted stock awards in excess of the deferred tax assets that were previously recorded.

Grant of RSUs

The Company issued 1,183,398 RSUs to eligible employees and Directors of the Company during the year ended December 31, 2025, which will vest over a period of 1 to 4 years for employees and a period of 1 year for Directors. The RSUs are valued using the stock price on the grant date and had an estimated grant date fair value of $9.8 million.

The following table sets forth the activities of the Company’s RSUs for the years ended December 31, 2025, 2024 and 2023.

(1)Includes 379,719 RSUs that are vested and not issued.

(2)Includes 522,270 RSUs that are vested and not issued.

(3)Includes 703,001 RSUs that are vested and not issued.

Grant of PSUs

The Company issued 159,105 PSUs to eligible employees during the year ended December 31, 2025. The PSUs are valued using the stock price and a performance expense factor on the grant date and had an estimated grant date fair value of $1.6 million. Performance-based shares vest based upon the passage of time and the achievement of performance conditions, in an amount ranging from 0% to 200% of the grant amount, as determined by the Compensation Committee prior to the date of the award. The vesting period for these awards is 3 years, with each year weighted equally in determining the final performance condition. The Company reviews the progress toward the attainment of the performance condition for each quarter during the vesting period. When it is probable the minimum performance condition for an award will be achieved, the Company will begin recognizing the expense equal to the proportionate share of the total fair value of the Class A-1 stock price on the grant date. The total expense recognized over the duration of performance awards will equal the Class A-1 stock price on the date of grant multiplied by the number of shares ultimately awarded based on the level of attainment of the performance condition. For grants with a market condition and a service condition, the fair value is determined on the grant date and is calculated using the average implied multiple using the Company’s internal forecast along with weighting of probability of award, with a service condition ofthree years, which was extended approximately four months to August 7, 2026. The total expense recognized over the duration of the award will equal the fair value, regardless if the market performance criteria is met. If the service condition is not met the stock-based compensation would be reversed.

The following table sets forth the activities of the Company’s PSUs for the years ended December 31, 2025 and 2024.

Grant of Stock Options

Stock options generally vest over athree tofive-year period and the term of the options are a maximum of 10 years from the grant date. The exercise price of stock options shall not be less than 100% of the fair market value per share of common stock on the grant date.

The Company used the Black-Scholes formula to estimate the fair value of its stock-based payments. The volatility assumption used in the Black-Scholes formula were based on the volatility of comparable public companies. The Company determined the share price at grant date used in the Black-Scholes formula based on an internal valuation model for options granted prior to the Company going public. Upon going public, the Company used the closing market stock price on the date of grant.

The fair value assigned to each option was estimated on the date of grant using a Black-Scholes-based option valuation model. The expected term of each option granted represented the period of time that each option granted is expected to be outstanding. The risk-free rate for periods within the contractual life of the unit is based on U.S. Treasury yields in effect at the time of grant.

Starting on January 1, 2023, the Company discontinued the use of stock options as part of the LTIP. The following table sets forth the activities of the Company’s outstanding stock options for the years ended December 31, 2025, 2024, and 2023.

A summary of the status of the activities of the Company’s nonvested stock options for the years ended December 31, 2025, 2024 and 2023 is as follows:

As of December 31, 2025, and 2024, a total of 532,902 and 524,739 options with a weighted-average remaining contractual term of 3.7 and 4.8 years, respectively, granted to employees were vested. The fair value of options that vested during 2025, 2024 and 2023 was $1.5 million, $1.9 million, and $2.2 million, respectively. As of December 31, 2025, and 2024, the weighted-average exercise price of the non-vested awards was $11.91 and $11.92, respectively. As of December 31, 2025, and 2024, the weighted-average remaining contractual term of the outstanding awards was 4.0 years and 5.5 years, respectively. The total intrinsic value of options that were exercised during the years ended December 31, 2024 and 2023 was approximately $0.3 million and $0.5 million, respectively. There wereno options exercised during the year ended December 31, 2025. The aggregate intrinsic value of options outstanding as of December 31, 2025 is $0.6 million.

Note 19. Income Taxes

The Company recognized income tax expense of $20.7 million, $18.4 million and $20.1 million during the years ended December 31, 2025, 2024 and 2023, respectively, which consists of the following (in thousands):

A reconciliation of the “expected” income taxes computed by applying the federal statutory income tax rate to the total expense is presented in the tables below in dollars (in thousands) and percentages:

For the years ended December 31, 2025, 2024, and 2023, state and local income taxes in Illinois comprise the majority of the state income taxes, net of federal benefit.

The Company’s cash payments for income taxes, net of refunds, by tax jurisdiction were as follows (in thousands):

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities were as follows as of December 31 (in thousands):

A valuation allowance is required to be established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized. The guidance on accounting for income taxes provides important factors in determining whether a deferred tax asset will be realized, including whether there has been sufficient taxable income in recent years and whether sufficient taxable income can reasonably be expected in future years in order to utilize the deferred tax asset.

The Company evaluated the need to record a valuation allowance for deferred tax assets based on an assessment of whether it is more likely than not that deferred tax benefits will be realized through the generation of future taxable income. Appropriate consideration was given to all available evidence, both positive and negative, in assessing the need for a valuation allowance. As a result of this evaluation, the Company concluded as of December 31, 2025, that the positive evidence outweighed the negative evidence and that it is more likely than not that its deferred tax assets will be realized.

As of December 31, 2025, and 2024, the Company did not record a liability for unrecognized tax benefits.

The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. As of December 31, 2025, the Company is subject to U.S. federal income tax examinations for the years 2022 through 2024 and income tax examinations from state jurisdictions for the years 2022 through 2024.

The following table summarizes carryforwards of net operating losses as of December 31 (in thousands):

Significant equity restructuring often results in an Internal Revenue Code Section 382 ownership change that limits the future use of net operating loss (“NOL”) carryforwards and other tax attributes. With regard to Century Gaming, an ownership change occurred on the date the outstanding equity interests were purchased in 2022. As a result, the Company's use of the acquired NOLs, interest expense limitation carryforward and R&D credit carryforward on an annual basis were limited. As of December 31, 2025, only the interest expense limitation is subject to limitation. The recognition and measurement of the Company's tax benefit includes estimates and judgment by the Company's management, which includes subjectivity. Changes in estimates may create volatility in the Company's tax rate in future periods based on new information about particular tax positions that may cause management to change its estimates.

The Company hadno credit carryforwards as of December 31, 2025.

The One Big Beautiful Bill Act (the “Act”) was signed into law on July 4, 2025. The Act contains significant tax law changes impacting business tax payers with various effective dates, with certain provisions effective in 2025 and others to be implemented through 2027. Among the tax law changes that impact the Company are those that relate to the timing of certain tax deductions including depreciation expense, interest expense and research and development expenditures. Because these tax law changes impact the timing of these deductions, they will not reduce the Company’s overall effective tax rate. However, these tax law changes have resulted in a favorable reduction in the Company’s current tax expense which is offset by an increase to deferred tax expense.

Note 20. Commitments and Contingencies

The Company has certain earnouts in periods for future location performance related to certain business acquisitions (see discussion in Note 10).

The Company has certain employment agreements that call for salaries and potential severance upon termination.

Lawsuits and claims are filed against the Company from time to time in the ordinary course of business, including related to employee matters, employment of professionals and non-compete clauses and agreements. Other than settled matters explained as follows, these actions are in various stages, and no judgments or decisions have been rendered. Management, after reviewing matters with legal counsel, believes that the outcome of such matters will not have a material adverse effect on the Company’s financial position or results of operations.

The Company has been involved in a series of related litigated matters stemming from claims that it wrongly contracted with 10 different licensed establishments (the “Defendant Establishments”) in 2012 in violation of the contractual rights held by J&J Ventures Gaming, LLC (“J&J”), as further described below.

On August 21, 2012, one of the Company’s operating subsidiaries entered into certain agreements with Jason Rowell (“Rowell”), a member of Action Gaming LLC (“Action Gaming”), which was an unlicensed terminal operator that had exclusive rights to place and operate gaming terminals within a number of establishments, including the Defendant Establishments. Under agreements with Rowell, the Company agreed to pay him for each licensed establishment which decided to enter into an exclusive location agreement with Accel. In late August and early September 2012, each of the Defendant Establishments signed a separate location agreement with the Company, purporting to grant the Company the exclusive right to operate gaming terminals in those establishments. Separately, on August 24, 2012, Action Gaming sold and assigned its rights to all its location agreements to J&J, including its exclusive rights with the Defendant Establishments (the “J&J Assigned Agreements”). At the time of the assignment of such rights to J&J, the Defendant Establishments were not yet licensed by the Illinois Gaming Board (“IGB”). As a result of subsequent litigation, the Supreme Court of Illinois determined that the IGB has exclusive jurisdiction to decide the validity and enforceability of gaming terminal use agreements, including the J&J Assigned Agreements.

Between May 2017 and September 2017, both the Company and J&J filed petitions with the IGB seeking adjudication of the rights of the parties and the validity of the J&J Assigned Agreements. Those petitions were recently adjudicated by the IGB, largely in the Company’s favor, and J&J has filedtwo new lawsuits to challenge the IGB’s rulings. J&J lost at both the trial court and appellate court level and recently filed a petition with the Illinois Supreme Court seeking permission for a further appeal. The petition for leave to appeal was denied by the Illinois Supreme Court. The second case is awaiting a ruling at the trial court level. The Company does not have a present estimate regarding the potential damages, if any, that could potentially be awarded in this litigation and, accordingly, has established no reserves relating to such matters.

On March 9, 2022, the Company filed a lawsuit in the Circuit Court of Cook County, Illinois against Gold Rush relating to the Gold Rush convertible notes. The complaint sought damages for breach of contract and the implied covenant of good faith and fair dealing as well as unjust enrichment. On June 22, 2022, Gold Rush filed a lawsuit in the Circuit Court of Cook County, Illinois against the Company. The lawsuit alleged that the Company tortiously interfered with Gold Rush’s business activities and engaged in misconduct with respect to the Gold Rush convertible notes. Both suits were dismissed with prejudice as a result of the previously mentioned settlement between the Company and Gold Rush on the convertible notes in May 2023. For more information, see Note 4.

On March 25, 2022, Midwest Electronics Gaming LLC (“Midwest”) filed an administrative review action against the IGB, the Company and J&J in the Circuit Court of Cook County, Illinois seeking administrative review of decisions of the IGB ruling in favor of the Company and J&J and against Midwest regarding the validity of certain use agreements covering locations currently serviced by Midwest. No monetary damages are sought against the Company. The Company filed a motion to dismiss Midwest’s amended complaint, which was granted in part and denied in part. The Company moved for summary judgment, and the trial court granted summary judgment in favor of the Company. The only remaining claim is Midwest’s claim against the IGB for the administrative review of the IGB’s decision. A ruling on that is expected sometime in the first half of 2026.

In July 2022, an enforcement action was brought against the Company by an Illinois municipality related to an alleged violation of an ordinance requiring the collection of an additional tax, the enforceability of which is currently being contested by the Illinois Gaming Machine Operators Association in the Circuit Court of Cook County. Rather than litigate the alleged violation, the Company pleaded no contest and has made the appropriate payments to the municipality during 2023, 2024 and 2025. In November 2025, a Circuit Court ruling, favorable to the Company, indefinitely stayed future administrative hearings and fines pending an appeal by the Illinois municipality. The Company does not anticipate making future voluntary payments during the appeal process.

In February 2023, an Illinois municipality issued an order against the Company for the alleged failure to pay a terminal operator tax (“TO Tax”) for the privilege of operating gaming terminals within the municipality. The TO Tax was adopted by the municipality on June 8, 2021, but there was no enforcement of this tax until the Company was issued a notice of hearing in February 2023. In April 2023, the Company, along with numerous other terminal operators, filed a complaint in the Circuit Court of Cook County, Illinois contesting the validity and enforceability of the TO Tax and won a temporary restraining order. On March 21, 2025, the Circuit Court of Cook County ruled favorably for the Company. The municipality has appealed this ruling.

The results for the years ended December 31, 2025 and 2024 included losses of $0.8 million and $0.5 million, respectively, related to these matters, which is included within general and administrative expenses in the consolidated statements of operations and other comprehensive income.

Note 21. Earnings Per Share

Basic EPS is computed based on the weighted average number of shares of Class A-1 common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding stock options, unvested RSUs, contingent earnout shares, and warrants.

Since the shares issuable under the contingent earnout are contingently issuable shares that depend on future earnings or future market prices of the common stock or a change in control, the shares are excluded when computing diluted EPS unless the shares would be issuable if the reporting date was the end of the contingency period. Upon settlement, these shares are included in Class A-1 common stock in the Company’s basic EPS share count.

The components of basic and diluted EPS were as follows (in thousands, except per share amounts):

Anti-dilutive stock-based awards, contingent earnout shares and warrants excluded from the calculations of diluted EPS were 4.2 million,4.3 million, and 4.4 million shares for the years ended December 31, 2025, 2024 and 2023, respectively.