PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
Due Diligence Memorandum
This memorandum is an internal work product of Calderwood & Harkness LLP, prepared in connection with the firm's representation of Redstone Gaming Corp. in the above-referenced offering. It is protected by the attorney-client privilege and the work product doctrine and is not intended for distribution to any third party. Any unauthorized review, use, disclosure, or distribution is strictly prohibited.
Re: Redstone Gaming Corp. — $180,000,000 Follow-On Equity Offering of Common Stock
Prepared by: Brendan Walsh, Lead Associate, Capital Markets, and Natasha Forbes, Working Associate, Capital Markets, Calderwood & Harkness LLP
Prepared for: Vivienne St. Claire, Responsible Partner, Capital Markets, and Robert Adeyemi, Billing Partner, Capital Markets, Calderwood & Harkness LLP
Date: October 20, 2025
Engagement No.: C&H-2025-CM-04187
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I. Executive Summary
Calderwood & Harkness LLP ("C&H" or the "Firm") represents Redstone Gaming Corp. ("RGC" or the "Company"), a Delaware corporation headquartered in Las Vegas, Nevada, in connection with a proposed $180,000,000 underwritten follow-on public offering (the "Offering") of shares of its common stock, par value $0.001 per share (NYSE: RDGM). This memorandum summarizes the results of the Firm's legal due diligence review conducted in connection with the Offering and is prepared for the internal use of the supervising partners on the engagement.
The Offering is structured as a firm commitment underwritten public offering to be conducted off a shelf registration statement on Form S-3 (SEC File No. 333-278401), which was originally filed with the Securities and Exchange Commission (the "SEC") on March 14, 2024 and declared effective on March 28, 2024. The Form S-3 provides for the issuance of up to $750,000,000 in aggregate offering price of securities, of which $200,000,000 was previously utilized in connection with a debt offering of 5.875% Senior Notes due 2031 completed in September 2024, leaving $550,000,000 of remaining shelf capacity prior to this Offering.
The underwriting syndicate for the Offering consists of:
• Pinnacle Zanthor & Co. — Lead bookrunning manager (60% of base offering)
• Hargrove Williams Securities LLC — Joint bookrunning manager (30% of base offering)
• Clearwater Capital Markets Inc. — Co-manager (10% of base offering)
The underwriters are represented by Whitmore & Pratt LLP. The Firm has been coordinating with Whitmore & Pratt on the drafting and negotiation of the underwriting agreement, prospectus supplement, and related offering documentation.
Based on current market conditions and preliminary indications of interest, the Offering is anticipated to consist of 6,557,377 shares of common stock at a public offering price of $27.45 per share, resulting in gross proceeds of approximately $180,000,000 (before deducting the underwriting discount and estimated offering expenses). The underwriting agreement will include a 15% over-allotment option (or "greenshoe") granting the underwriters the option to purchase up to 983,606 additional shares at the public offering price, less the underwriting discount, within 30 days of the offering date. If the over-allotment option is exercised in full, the maximum number of shares to be issued in the Offering would be 7,540,983 shares, and the maximum aggregate gross proceeds would be approximately $207,000,000.
The expected pricing date for the Offering is October 28, 2025, with settlement and closing anticipated to occur on October 31, 2025, on a T+3 basis consistent with standard market practice for underwritten equity offerings.
The purpose of this memorandum is to summarize the Firm's legal due diligence findings across the following key areas: corporate organization and good standing, gaming regulatory compliance, SEC filings and registration statement matters, material contracts, existing indebtedness, litigation, intellectual property, employee and benefit matters, environmental and real property, tax matters, insurance, and anti-money laundering and compliance. The memorandum also identifies open items requiring further follow-up and sets forth the Firm's recommendations for completing the due diligence process prior to pricing and closing.
Overall Conclusion: Based on the due diligence review conducted to date and summarized herein, no issues have been identified that would prevent the Offering from proceeding on the anticipated timetable, subject to the specific items, observations, and open items noted in each section below. All material findings have been or are being reflected in the disclosure contained in the preliminary prospectus supplement, which is being revised in response to the SEC Staff comment letter received on October 14, 2025.
II. Scope and Methodology
The Firm's due diligence review was conducted in accordance with the standards applicable to legal due diligence in connection with underwritten public offerings of equity securities and with due regard to the Firm's obligations under Section 11 of the Securities Act of 1933, as amended (the "Securities Act"), and the related case law, including Escott v. BarChris Construction Corp., 283 F. Supp. 643 (S.D.N.Y. 1968), and subsequent authorities establishing the contours of reasonable investigation and the due diligence defense.
Materials Reviewed. The following categories of documents and materials were reviewed in connection with the preparation of this memorandum:
1. Corporate Records. Certificate of Incorporation, as amended; Bylaws; minutes of meetings and written consents of the Board of Directors and its committees (including the Pricing Committee); stockholder meeting materials; corporate organizational chart; and subsidiary formation documents.
2. Public SEC Filings. Annual Report on Form 10-K for the fiscal year ended December 31, 2024; Amendment No. 1 to Annual Report on Form 10-K/A filed July 15, 2025; Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025 and June 30, 2025; Proxy Statement on Schedule 14A for the 2025 Annual Meeting of Stockholders; and all Current Reports on Form 8-K filed through October 15, 2025.
3. Registration Statement and Offering Materials. Form S-3 shelf registration statement (SEC File No. 333-278401), including all exhibits; preliminary prospectus supplement filed under Rule 424(b)(5) on October 6, 2025; SEC Staff comment letter dated October 14, 2025; and drafts of the revised prospectus supplement and response letter.
4. Gaming License Files. Copies of all gaming licenses, permits, and authorizations held by RGC and its subsidiaries; pending gaming license applications for Louisiana and Indiana; correspondence with state gaming regulatory authorities.
5. Material Contract Files. Leases and operating agreements for casino-resort properties; the Louisiana development rights acquisition agreement; the financial advisory engagement letter; the transfer agent agreement; and directors' and officers' liability insurance policies.
6. Indentures and Credit Agreements. Indenture dated June 15, 2021 governing the 6.25% Senior Secured Notes due 2028; Indenture dated September 20, 2024 governing the 5.875% Senior Notes due 2031; and the revolving credit agreement with Meridian National Bank, N.A.
7. Litigation Files. Internal litigation summary prepared by the Office of the General Counsel; selected litigation files for pending matters; and results of independent litigation docket searches.
8. intellectual Property Registrations. Trademark registrations and applications; domain name registrations; technology license agreements; and summaries of proprietary software and trade secret protections.
9. Employee Benefit Plan Documents. 2021 Equity Incentive Plan and related Board resolutions; executive employment agreements; collective bargaining agreements; 401(k) plan documents; and summaries of health, welfare, and other employee benefit plans.
10. Insurance Policies. Directors' and officers' liability insurance; property and casualty insurance; general liability insurance; workers' compensation insurance; and cybersecurity insurance.
11. Environmental and Real Property Materials. Phase I environmental site assessments for owned properties; real property deeds and title documents; and environmental compliance summaries.
12. Tax Materials. Federal and state tax returns for fiscal years 2022 through 2024; correspondence with tax authorities; and internal tax compliance memoranda.
Management Interviews. In addition to the document review, the Firm conducted in-person and telephonic interviews with the following members of RGC's senior management:
• Marcus Hale, Chief Executive Officer — discussions regarding business strategy, use of proceeds, expansion plans (Louisiana and Indiana), and overall corporate governance matters.
• Lena Okafor, Chief Financial Officer — discussions regarding financial condition, debt covenant compliance, capitalization, use of proceeds allocation, and the Form 10-K/A amendment.
• Darren Whitfield, Executive Vice President and General Counsel — discussions regarding litigation, regulatory compliance, gaming license status, material contracts, intellectual property, and employee benefit matters.
These discussions were conducted between October 1, 2025 and October 15, 2025. Notes of these discussions are maintained in the Firm's engagement files.
Review Period and Limitations
Corporate and contractual documents were reviewed as of October 15, 2025. Independent litigation docket searches were conducted and updated through October 18, 2025, covering federal and state courts in Nevada, New Jersey, Mississippi, Delaware, and New York. SEC filings were reviewed through the date of the preliminary prospectus supplement filing (October 6, 2025), with subsequent filings monitored on an ongoing basis.
It should be noted that this memorandum does not constitute an exhaustive legal audit of all aspects of the Company's business, operations, or legal affairs. Rather, it is intended to summarize the Firm's findings with respect to matters material to the Offering disclosure and to the Firm's Section 11 due diligence obligations. Certain areas of inquiry — including detailed environmental compliance, employee benefit plan qualification, and state tax matters — are addressed at a summary level and may require additional analysis as circumstances warrant. The Firm has relied upon the representations of management and the completeness and accuracy of the documents and information provided to the Firm by the Company, subject to the Firm's independent verification efforts as described herein.
III. Corporate Organization and Good Standing
A. Incorporation and Charter Documents
Redstone Gaming Corp. was incorporated in the State of Delaware under the General Corporation Law of the State of Delaware. The Company's Delaware Charter File Number is 7291845. The Company's registered agent in the State of Delaware is Capitol Corporate Services, Inc., located at 1209 Orange Street, Wilmington, Delaware 19801.
The Firm has reviewed the Company's Certificate of Incorporation, as amended to date (collectively, the "Charter"). The Charter authorizes the issuance of two classes of capital stock: (i) 300,000,000 shares of common stock, par value $0.001 per share, and (ii) 10,000,000 shares of preferred stock, par value $0.001 per share. The Board of Directors is authorized, without further stockholder approval, to issue shares of preferred stock in one or more series and to fix the designations, powers, preferences, and rights of each such series. No shares of preferred stock are currently outstanding, and the Company has not designated any series of preferred stock.
The Charter contains customary provisions regarding the limitation of director liability under Section 102(b)(7) of the Delaware General Corporation Law, indemnification of directors and officers, and related matters. No unusual or non-standard provisions were identified that would be material to the Offering.
The Firm has also reviewed the Company's Bylaws, as currently in effect. The Bylaws contain customary provisions governing the conduct of stockholder meetings, the election and removal of directors, the appointment of officers, and the issuance of stock certificates. No material amendments to the Bylaws have been made since the most recent proxy filing, and no provisions were identified that would impose any restriction or impediment on the Offering.
B. Good Standing and Qualification
The Firm obtained a certificate of good standing from the Secretary of State of the State of Delaware, dated October 10, 2025, confirming that RGC is in good standing under the laws of Delaware. The Company is current in the payment of its Delaware franchise taxes.
RGC is qualified to do business and in good standing as a foreign corporation in the following states, corresponding to the jurisdictions in which it maintains casino-resort properties and principal operations:
• Nevada — The Company's headquarters are located at 3900 Las Vegas Boulevard South, Suite 1200, Las Vegas, Nevada 89119. Nevada is the Company's principal place of operations, with multiple casino-resort properties located in the state.
• New Jersey — The Company operates casino properties in Atlantic City, New Jersey.
• Mississippi — The Company operates casino properties in Mississippi.
Good standing certificates or equivalent confirmations were obtained or are in the process of being obtained for each of these jurisdictions.
Open Item — Foreign Qualification for Digital Gaming Operations: RedBet Digital LLC, the Company's wholly-owned subsidiary that operates its digital gaming platform, currently offers online sports betting and iGaming services in twelve states. The Firm has not yet confirmed that either RGC or RedBet Digital is qualified to do business in each of these twelve states, as applicable. This confirmation is required and should be completed prior to pricing. The list of twelve states in which RedBet Digital operates should be cross-referenced with the RedBet Digital state gaming licenses and authorizations to ensure consistency and completeness.
C. Capitalization. As of the date of this memorandum, the Company's capitalization is as follows:
The weighted-average exercise price of outstanding options under the 2021 Equity Incentive Plan is $19.72 per share.
Following the Offering (assuming no exercise of the over-allotment option), the number of shares of common stock outstanding will be 158,957,377. If the over-allotment option is exercised in full, the number of shares of common stock outstanding will be 159,940,983. These figures do not include shares issuable upon the exercise of outstanding options under the 2021 Equity Incentive Plan.
Authorized Share Sufficiency. The Charter authorizes 300,000,000 shares of common stock. With 152,400,000 shares currently outstanding, the Company has 147,600,000 authorized but unissued shares of common stock available for issuance. The maximum number of shares to be issued in the Offering (including full exercise of the greenshoe) is 7,540,983, which is well within the number of authorized but unissued shares. No stockholder vote or amendment to the Charter is required to authorize the issuance of shares in the Offering.
Board Authorization. The Board of Directors of RGC adopted resolutions on September 30, 2025 authorizing the Offering of up to 8,000,000 shares of common stock at a price not less than $25.00 per share. The Board designated a Pricing Committee consisting of Marcus Hale (CEO), Lena Okafor (CFO), and Patricia Moynihan (independent director and Chair of the Audit Committee) with authority to set the final terms of the Offering, including the precise number of shares, the public offering price, and the underwriting discount, within the parameters established by the Board. The Firm reviewed the Board resolutions and confirmed that they are sufficient to authorize the Offering on the anticipated terms.
D. Significant Shareholders
Based on the Company's public filings, SEC EDGAR searches, and management representations, the following stockholders are the beneficial owners of 5% or more of the Company's outstanding common stock:
Grandview Capital Partners, LP
• Shares held: 18,720,000 (approximately 12.28% of outstanding shares)
• Managing Partner: Elena Vasquez
• Address: 200 Clarendon Street, 48th Floor, Boston, Massachusetts 02116
• Filing status: Files Schedule 13D with the SEC; most recent amendment reviewed
• Offering participation: Grandview is not selling shares in the Offering; Grandview will be subject to a 90-day lock-up agreement in connection with the Offering, restricting the sale or transfer of its shares without the prior written consent of Pinnacle Zanthor & Co.
Thornbridge Asset Management, Inc.
• Shares held: 10,668,000 (approximately 7.00% of outstanding shares)
• Portfolio Manager: James Harwood
• Address: 401 North Michigan Avenue, Suite 3200, Chicago, Illinois 60611
• Filing status: Files Schedule 13G with the SEC; most recent filing reviewed
• Offering participation: Thornbridge is not selling shares in the Offering; Thornbridge is not subject to a lock-up agreement
No other stockholders have been identified as beneficial owners of 5% or more of the Company's outstanding common stock based on the Firm's review. The Company has confirmed that no stockholder agreement, voting agreement, registration rights agreement, or similar arrangement exists between the Company and either of the significant stockholders identified above, other than the lock-up agreement with Grandview described herein.
E. Subsidiary Structure
RGC operates through a number of wholly-owned subsidiaries. The principal subsidiary is RedBet Digital LLC, a limited liability company organized under the laws of the State of Nevada, which operates the Company's digital gaming platform offering online sports betting and iGaming services in twelve states. RedBet Digital is a wholly-owned subsidiary of RGC, with RGC as its sole member.
In addition to RedBet Digital, the Company maintains separate operating subsidiaries for each of its eight casino-resort properties located across Nevada, New Jersey, and Mississippi. The names, jurisdictions of organization, and ownership structure of these operating subsidiaries were reviewed in the corporate organizational chart provided by management and are set forth in Appendix A hereto. Each operating subsidiary is a wholly-owned direct or indirect subsidiary of RGC.
No minority interests, joint ventures, or unconsolidated variable interest entities were identified that would require special disclosure in the Offering materials or that would present any impediment to the Offering. The corporate organizational chart is consistent with the disclosure contained in the Company's Form 10-K for FY 2024 and will be confirmed as accurate through the bring-down due diligence process.
IV. Gaming Regulatory Compliance
The gaming industry is one of the most heavily regulated industries in the United States, and compliance with applicable gaming laws, regulations, and licensing requirements is essential to the Company's operations and to the accuracy of the Offering disclosure. The Firm has conducted a review of the Company's gaming regulatory compliance, including its existing gaming licenses, pending license applications, and the regulatory status of its digital gaming operations through RedBet Digital LLC. The findings of this review are summarized below.
A. Existing Gaming Licenses
RGC and its operating subsidiaries hold gaming licenses or permits from the following state gaming regulatory authorities, each of which has been confirmed as current and in good standing:
Nevada Gaming Commission
• License No.: NGC-2019-04172
• Status: Current and in good standing
• Scope: Covers RGC's casino-resort operations in the State of Nevada, including all gaming activities conducted at RGC's Nevada properties
• Most recent renewal: Confirmed; renewal cycle consistent with applicable Nevada Gaming Control Act requirements
• No pending enforcement actions, disciplinary proceedings, or material findings
New Jersey Division of Gaming Enforcement
• License No.: NJDGE-2020-1138
• Status: Current and in good standing
• Scope: Covers RGC's casino operations in the State of New Jersey, including gaming activities conducted at the Company's Atlantic City properties
• No pending enforcement actions, disciplinary proceedings, or material findings
Mississippi Gaming Commission
• License No.: MGC-2018-0623
• Status: Current and in good standing
• Scope: Covers RGC's casino operations in the State of Mississippi
• No pending enforcement actions, disciplinary proceedings, or material findings
As of the date of this memorandum, no pending enforcement actions, license revocations, license suspensions, or material adverse findings by any existing state gaming regulatory authority have been identified with respect to any of the Company's gaming licenses. The Firm notes, however, that gaming licenses are privileges, not rights, and are subject to revocation, suspension, or modification at the discretion of the applicable regulatory authority. This risk is appropriately disclosed in the risk factors section of the prospectus supplement.
Revenue Concentration — Nevada. Based on the Company's public filings and management representations, approximately 58% of the Company's total gaming revenue is concentrated in its Nevada operations. SEC Staff Comment 2, received in the comment letter dated October 14, 2025, specifically requests enhanced risk factor disclosure regarding this geographic concentration. The Firm is working with the Company and the underwriters to draft a revised risk factor addressing the Company's reliance on its Nevada operations and the potential impact of adverse changes in the Nevada regulatory or economic environment.
B. Pending Gaming License Applications
In connection with its announced expansion plans, RGC has submitted gaming license applications to two additional state gaming regulatory authorities:
Louisiana Gaming Control Board
• Application submitted: August 12, 2025
• Scope: Application for licensure in connection with the acquisition of development rights and initial construction of a casino-resort in Bossier City, Louisiana
• Estimated project cost: Approximately $70,000,000 of net offering proceeds are allocated to this project (acquisition of development rights and initial construction costs)
• Status: The application is in the early stages of review by the Louisiana Gaming Control Board; the Firm has been informed that the application has been accepted for processing but that no substantive review has been completed as of the date of this memorandum
• No indication of adverse findings or objections to the application has been received to date
Indiana Gaming Commission
• Application submitted: September 5, 2025
• Scope: Application for licensure in connection with the renovation and rebranding of a leased gaming facility in Gary, Indiana
• Estimated project cost: Approximately $45,000,000 of net offering proceeds are allocated to this project
• Status: The application is in the early stages of review by the Indiana Gaming Commission; no substantive review has been completed as of the date of this memorandum
• No indication of adverse findings or objections to the application has been received to date
Risk Factor Disclosure. The prospectus supplement includes risk factor disclosure noting that a significant portion of the offering proceeds will be deployed to the Louisiana and Indiana expansion projects and that there can be no assurance that the pending gaming license applications will be approved. The risk factor further notes that the failure to obtain the required gaming licenses could result in the Company being unable to proceed with the planned expansion projects and the reallocation of the corresponding offering proceeds to other corporate purposes. The Firm believes this disclosure is adequate, but will continue to monitor the status of both applications and recommend updates to the disclosure as developments warrant.
C. Digital Gaming Regulatory Compliance (RedBet Digital)
RedBet Digital LLC, the Company's wholly-owned subsidiary, operates an online sports betting and iGaming platform in twelve states. Each state in which RedBet Digital operates requires separate state-level licensure, authorization, or registration, and the regulatory requirements vary significantly from state to state.
The Firm has reviewed the state gaming licenses, authorizations, and registrations held by RedBet Digital in each of the twelve states in which it operates and has confirmed that RedBet Digital is in current compliance with all applicable licensing requirements as of the date of this memorandum. A schedule of RedBet Digital's state gaming licenses is included in Appendix B.
The regulatory landscape for online sports betting and iGaming continues to evolve rapidly, with multiple states considering new legislation and regulations governing these activities. The Firm has not identified any material pending regulatory changes in any of the twelve states in which RedBet Digital operates that would adversely affect existing operations. However, the prospectus supplement includes a risk factor addressing the general regulatory uncertainty associated with the online gaming industry, and the Firm recommends that this risk factor be maintained and updated as necessary.
V. SEC Filings and Registration Statement
A. Shelf Registration
The Offering will be conducted pursuant to a shelf registration statement on Form S-3 (SEC File No. 333-278401; CIK No. 0001847293), which was originally filed with the SEC on March 14, 2024 and was declared effective on March 28, 2024. The Form S-3 provides for the issuance from time to time of up to $750,000,000 in aggregate offering price of common stock, preferred stock, debt securities, warrants, depositary shares, and units.
The shelf registration statement has been utilized once previously:
• September 2024 Debt Offering: $200,000,000 aggregate principal amount of 5.875% Senior Notes due 2031, priced and settled in September 2024.
Following the September 2024 debt offering, the remaining shelf capacity was $550,000,000. The maximum aggregate gross proceeds from the current Offering, including full exercise of the over-allotment option, are approximately $207,000,000, which is within the remaining shelf capacity. Following the current Offering (assuming full exercise of the greenshoe), the remaining shelf capacity will be approximately $343,000,000 (or approximately $370,000,000 if the greenshoe is not exercised).
The Firm has confirmed that the Company meets the eligibility requirements for use of Form S-3, including the requirements of General Instruction I.B.1 (public float in excess of $75,000,000), and that the shelf registration statement remains effective and has not been subject to any stop order or proceeding under Section 8(d) of the Securities Act.
B. Periodic Reports
The Firm has reviewed the Company's periodic reports filed with the SEC and incorporated by reference into the shelf registration statement and the prospectus supplement. A summary of the key filings reviewed is set forth below.
Annual Report on Form 10-K for FY Ended December 31, 2024. The Company's Form 10-K for FY 2024 was filed with the SEC on March 3, 2025 and reported the following key financial results:
The Form 10-K includes audited financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and accompanied by an unqualified audit opinion issued by Kaplan Feld & Associates LLP, the Company's independent registered public accounting firm. The audit engagement partner is Sandra Meyers, CPA. The Form 10-K also includes management's report on internal control over financial reporting, which reported no material weaknesses in the Company's internal control over financial reporting.
Amendment No. 1 to Annual Report on Form 10-K/A. The Company filed a Form 10-K/A on July 15, 2025, which amends certain disclosures in the originally filed Form 10-K for FY 2024. The nature of the amendments was reviewed by the Firm, and the Company has confirmed that the amendments were made to correct certain immaterial errors and to update certain disclosures. The Firm notes that SEC Staff Comment 4, received in the comment letter dated October 14, 2025, specifically requires that the Form 10-K/A be identified in the incorporation-by-reference section of the prospectus supplement, as distinct from the originally filed Form 10-K. This revision is being made in the revised prospectus supplement currently under preparation.
Quarterly Reports on Form 10-Q. The Firm reviewed the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025 (Q1 2025) and June 30, 2025 (Q2 2025). No material discrepancies, restatements, or unusual items were noted in these filings. The financial results for Q1 and Q2 2025 were consistent with management's guidance and with the Company's historical trends, and the Company reported continued growth in both its land-based and digital gaming operations.
Current Reports on Form 8-K. The Firm reviewed all Current Reports on Form 8-K filed by the Company through October 15, 2025. No material items requiring additional disclosure in the prospectus supplement were identified. The Form 8-K filings reviewed during this period included routine filings related to the announcement of quarterly earnings, the entry into the financial advisory engagement with Ridgeline Advisory Group LLC, and the announcement of the Company's expansion plans in Louisiana and Indiana.
C. SEC Comment Letter
On October 14, 2025, the SEC Staff issued a comment letter containing six comments on the preliminary prospectus supplement filed on October 6, 2025 under Rule 424(b)(5). The comments are summarized below:
1. Use of Proceeds (Comment 1). The SEC Staff requested greater specificity regarding the Company's intended use of proceeds, including a more detailed breakdown of the allocation of net offering proceeds among the Louisiana expansion project, the Indiana expansion project, the partial retirement of the 6.25% Senior Secured Notes, and general corporate purposes.
2. Nevada Revenue Concentration Risk Factor (Comment 2). The SEC Staff requested enhanced risk factor disclosure regarding the concentration of approximately 58% of the Company's total gaming revenue in its Nevada operations.
3. Dilution Table (Comment 3). The SEC Staff requested revisions to the dilution table to address the dilutive effect of outstanding options under the 2021 Equity Incentive Plan and to present dilution on both a per-share and aggregate basis.
4. 10-K/A Incorporation by Reference (Comment 4). The SEC Staff requested that the Form 10-K/A filed July 15, 2025 be specifically identified in the incorporation-by-reference section of the prospectus supplement, rather than being subsumed within the reference to the "Annual Report on Form 10-K."
5. Regulation M Disclosure (Comment 5). The SEC Staff requested clarification of the disclosure regarding stabilization and passive market-making activities by the underwriters under Regulation M.
6. Exhibit 5.1 Legal Opinion Scope (Comment 6). The SEC Staff requested confirmation that the Exhibit 5.1 legal opinion to be issued by Calderwood & Harkness LLP will cover the full number of shares registered under the shelf registration statement, including shares issuable upon exercise of the over-allotment option.
The Firm's internal target for submission of the response letter and revised prospectus supplement to the SEC Staff is October 21, 2025. A separate SEC Comment Analysis Memorandum is being prepared by the Firm and will be circulated to the engagement team and to the Company for review prior to submission. The Firm has discussed each of the SEC Staff comments with the Company and with underwriters' counsel and does not anticipate any material difficulty in resolving the comments within the targeted timeline.
VI. Material Contracts
The Firm has reviewed the material contracts to which RGC and its subsidiaries are parties, with a focus on identifying any provisions that could be triggered by, or that are otherwise relevant to, the Offering. The following is a summary of the key categories of material contracts reviewed and the Firm's findings with respect to each.
A. Casino Property Leases and Operating Agreements
RGC and its operating subsidiaries are parties to leases and operating agreements governing the eight casino-resort properties that the Company operates across Nevada, New Jersey, and Mississippi. The Firm reviewed these leases and operating agreements, with particular attention to change-of-control provisions, anti-dilution provisions, consent requirements, and any other provisions that could be triggered by the issuance of additional shares of common stock in the Offering.
Based on this review, the Firm has confirmed that no change-of-control or anti-dilution provisions in any existing lease or operating agreement are triggered by the follow-on equity offering. The leases and operating agreements contain customary terms and conditions and do not impose any unusual restrictions or obligations on the Company in connection with capital markets transactions.
With respect to the Gary, Indiana facility, the Company operates a leased gaming facility that is the subject of the planned renovation and rebranding project for which approximately $45,000,000 of net offering proceeds have been allocated. The Firm reviewed the terms of the Gary lease and confirmed that the lease permits the planned renovation and rebranding activities, subject to customary landlord consent requirements. No material issues were identified in connection with the Gary lease. The planned renovation is contingent upon obtaining the requisite gaming license from the Indiana Gaming Commission, as discussed in Section IV.B above.
B. Louisiana Development Rights
The Firm reviewed the agreement pursuant to which RGC proposes to acquire development rights in Bossier City, Louisiana, for the construction of a new casino-resort property. The agreement is contingent upon the Company obtaining the necessary gaming license from the Louisiana Gaming Control Board, and the Company's obligations under the agreement will not become binding until such licensure is obtained. Approximately $70,000,000 of net offering proceeds are earmarked for the acquisition of development rights and initial construction costs associated with this project.
The agreement contains customary representations, warranties, and conditions precedent, including the gaming license condition. The Firm has confirmed that the agreement does not contain any unusual or non-standard provisions and does not impose any obligations on the Company that would be material to the Offering disclosure beyond those already addressed in the prospectus supplement.
C. Underwriting Agreement
The underwriting agreement among RGC and the underwriting syndicate (Pinnacle Zanthor & Co., Hargrove Williams Securities LLC, and Clearwater Capital Markets Inc.) is currently under negotiation between the Firm (as counsel to the Company) and Whitmore & Pratt LLP (as counsel to the underwriters). The underwriting agreement will be governed by the laws of the State of New York.
The key terms of the underwriting agreement, as currently contemplated, are summarized below:
• Structure: Firm commitment underwritten public offering
• Base Shares: 6,557,377 shares of common stock
• Public Offering Price: $27.45 per share
• Underwriting discount: 4.0% of the public offering price ($1.098 per share)
• Total Underwriting discount (Base Offering): Approximately $7,200,000
• Over-Allotment Option: 15% of base shares (983,606 additional shares), exercisable within 30 days of pricing
• Net Proceeds to Company (Base Offering): Approximately $172,800,000 (before estimated offering expenses)
• Lock-Up: 90-day lock-up period applicable to directors, executive officers, and certain significant stockholders, subject to release with the prior written consent of Pinnacle Zanthor & Co.
• Indemnification and Contribution: Customary indemnification and contribution provisions, with the Company indemnifying the underwriters against liabilities under the Securities Act arising from material misstatements or omissions in the registration statement or prospectus (other than information furnished by the underwriters for inclusion therein), and the underwriters indemnifying the Company against liabilities arising from information furnished by the underwriters
• Representations and Warranties: Customary representations and warranties by the Company
• Conditions to Closing: Customary conditions, including delivery of legal opinions, comfort letters, officers' certificates, and bring-down due diligence
The Firm expects to finalize the underwriting agreement prior to pricing on October 28, 2025. No material open issues remain in the negotiation of the underwriting agreement as of the date of this memorandum.
D. Financial Advisory Engagement
Ridgeline Advisory Group LLC, a registered investment advisory firm, has been engaged by RGC as its independent financial advisor in connection with the Offering. The engagement is being managed by Victor Tanaka, Managing Director of Ridgeline. The engagement letter provides for Ridgeline to provide valuation support, market analysis, and advisory services in connection with the pricing of the Offering.
The Firm reviewed the engagement letter and confirmed that it contains customary terms and conditions, including provisions regarding compensation, indemnification, and confidentiality. No material issues were identified. Ridgeline's role as financial advisor does not give rise to any conflicts of interest that would require disclosure in the prospectus supplement.
E. Transfer Agent Agreement
Continental Share Services, Inc. serves as the transfer agent and registrar for the Company's common stock. Continental's offices are located at 1 Ashbury Asset Advisors Plaza, 30th Floor, New York, New York 10004. The Firm reviewed the existing transfer agent agreement and confirmed that it is in effect and that no material issues or disputes exist between the Company and the transfer agent. The transfer agent agreement contains customary provisions and does not require amendment in connection with the Offering.
F. D&O Insurance
The Company maintains directors' and officers' liability insurance underwritten by Sentinel Risk Underwriters, Inc. The policy details are as follows:
• Policy No.: SRU-DOX-2025-41882
• Policy Limit: $75,000,000
• Coverage: Current and in effect
• No pending claims under the policy
The Firm confirmed that the D&O insurance policy provides coverage for the Company's directors and officers in connection with claims arising from the Offering, subject to the terms, conditions, and exclusions set forth in the policy. The policy limit of $75,000,000 is consistent with industry norms for a public company of the Company's size and industry.
A summary of all material contracts reviewed is set forth in Appendix C.
VII. Existing Indebtedness
The Firm has reviewed the Company's existing indebtedness, including the indentures, credit agreements, and related documents governing each of the Company's outstanding debt instruments. The purpose of this review was to identify any provisions that could be triggered by, or that are otherwise relevant to, the Offering, including restrictions on the issuance of equity securities, mandatory prepayment provisions, change-of-control provisions, cross-default provisions, and financial covenant compliance.
A. 6.25% Senior Secured Notes due 2028
The Firm reviewed the indenture dated June 15, 2021 governing the 6.25% Senior Secured Notes due 2028 (the "2028 Notes Indenture"). The key findings of this review are as follows:
• Equity Issuance: The 2028 Notes Indenture does not contain any restriction on the issuance of equity securities by the Company. The Offering does not require the consent of the indenture trustee or the holders of the 2028 Notes.
• Change of Control: The 2028 Notes Indenture contains a customary change-of-control provision requiring the Company to make an offer to repurchase the notes at 101% of par upon the occurrence of a change of control. The issuance of shares in the Offering does not constitute a change of control under the indenture definition, which generally requires an acquisition of more than 50% of the voting power of the Company by a person or group (other than holders who are already significant stockholders).
• Planned Partial Retirement: The Company intends to use approximately $50,000,000 of net offering proceeds to retire a portion of the outstanding 2028 Notes at par, reducing the outstanding principal from $325,000,000 to $275,000,000. The Firm reviewed the optional redemption provisions of the 2028 Notes Indenture and confirmed that the notes may be redeemed at par plus accrued and unpaid interest at any time on or after June 15, 2025. Since the planned partial retirement will occur after this date, no make-whole premium is required, and the redemption is consistent with the terms of the indenture.
• No Cross-Default Concerns: The partial retirement of the 2028 Notes does not constitute an event of default under any of the Company's other debt instruments, including the 5.875% Senior Notes due 2031 or the revolving credit facility.
B. 5.875% Senior Notes due 2031
The 5.875% Senior Notes due 2031 (the "2031 Notes") were issued in September 2024 in a prior takedown from the shelf registration statement. The Firm reviewed the indenture dated September 20, 2024 governing the 2031 Notes (the "2031 Notes Indenture"). The key findings of this review are as follows:
• Equity Issuance: The 2031 Notes Indenture does not contain any restriction on the issuance of equity securities by the Company. The Offering does not require the consent of the indenture trustee or the holders of the 2031 Notes.
• No Change to Outstanding Principal: No portion of the offering proceeds is expected to be used to repay or retire the 2031 Notes. The outstanding principal of $200,000,000 will remain unchanged following the Offering.
• Cross-Default: The 2031 Notes Indenture contains customary cross-default provisions. The Firm has confirmed that the planned partial retirement of the 2028 Notes does not trigger any cross-default under the 2031 Notes Indenture, as the partial retirement will be conducted in accordance with the optional redemption provisions of the 2028 Notes Indenture and does not constitute an event of default or acceleration under that instrument.
C. Revolving Credit Facility
The Firm reviewed the credit agreement governing the Company's $400,000,000 revolving credit facility (the "Credit Agreement"). The key findings of this review are as follows:
• Equity Issuance: The Credit Agreement does not restrict the issuance of equity securities by the Company. The Offering does not require the consent of the administrative agent or any lender under the Credit Agreement.
• Mandatory Prepayment: The Credit Agreement does not contain any mandatory prepayment provision triggered by the receipt of equity offering proceeds. Accordingly, the Company is not required to apply any portion of the net offering proceeds to reduce the outstanding balance under the revolving credit facility.