Company Performance - Hall of Fame Resort & Entertainment Company (NASDAQ:HOFV) experienced a significant stock price drop of 66.48%, now at $0.28, attributed to a proposed merger and an investigation by Monteverde & Associates PC [2][8] - Sentage Holdings Inc. (NASDAQ:SNTG) saw a 40.23% decrease in its stock price to $4.07, influenced by its financial results for the first half of fiscal year 2024 and the volatile financial market in China [3][8] - CXApp Inc. faced a 35.09% decline in its stock price to $0.064, as it is still establishing its market position in the workplace experience solutions sector [4][8] - Osisko Development Corp.'s warrant dropped by 34.49% to $0.24, reflecting changes in gold market dynamics and investor sentiment regarding its exploration projects [5][8] - Fangdd Network Group Ltd. saw a 32.36% decrease in its stock price to $3.42, indicative of the health of the real estate market and regulatory environment in China [6][8] Market Trends - The significant price movements of these companies highlight the importance of monitoring company-specific news, industry trends, and economic factors that can impact stock prices [7][8]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements of Hall of Fame Resort & Entertainment Company and its subsidiaries for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of operations, changes in stockholders' equity, and cash flows, along with comprehensive notes detailing accounting policies, debt, equity, and other commitments [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The Condensed Consolidated Balance Sheets show a decrease in total assets and total equity from December 31, 2024, to June 30, 2025, primarily driven by an increase in notes payable and accumulated deficit, while cash and restricted cash saw an increase Condensed Consolidated Balance Sheets (Unaudited) | Metric | June 30, 2025 (unaudited) | December 31, 2024 | | :-------------------------------- | :------------------------ | :------------------ | | Total assets | $360,497,791 | $366,705,811 | | Total liabilities | $315,671,345 | $294,474,352 | | Total equity | $44,826,446 | $72,231,459 | | Cash | $831,075 | $432,174 | | Restricted cash | $4,410,344 | $4,015,377 | | Notes payable, net | $261,944,445 | $245,747,816 | | Accumulated deficit | $(301,058,485) | $(273,561,929) | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a net loss attributable to HOFRE stockholders of $(12.16) million for the three months ended June 30, 2025, an improvement from $(15.75) million in the prior year period. For the six months ended June 30, 2025, the net loss was $(27.50) million, also an improvement from $(30.64) million in the prior year, despite a decrease in total revenues for both periods Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenues | $4,342,269 | $4,699,669 | $7,287,602 | $8,890,984 | | Loss from operations | $(5,718,676) | $(8,389,679) | $(14,091,004) | $(15,481,910) | | Net loss attributable to HOFRE stockholders | $(12,161,606) | $(15,754,982) | $(27,496,556) | $(30,642,570) | | Net loss per share, basic and diluted | $(1.82) | $(2.41) | $(4.11) | $(4.71) | [Condensed Consolidated Statement of Changes in Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) The total stockholders' equity decreased from $72.23 million at January 1, 2025, to $44.83 million at June 30, 2025, primarily due to net losses and preferred stock dividends, partially offset by stock-based compensation Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) | Metric | January 1, 2025 | June 30, 2025 | | :-------------------------------- | :-------------- | :------------ | | Total Stockholders' Equity | $72,231,459 | $44,826,446 | | Net loss | $(27,496,556) | $(27,496,556) | | Preferred stock dividend | $(532,000) | $(532,000) | | Stock-based compensation | $91,543 | $91,543 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, the company experienced a net increase in cash and restricted cash of $0.79 million, a significant improvement from a decrease of $5.37 million in the prior year. This was driven by increased cash from financing activities and reduced cash used in investing activities, despite higher cash used in operating activities Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Net cash used in operating activities | $(6,304,920) | $(5,310,177) | | Net cash used in investing activities | $(122,732) | $(3,777,401) | | Net cash provided by financing activities | $7,221,520 | $3,714,860 | | Net increase (decrease) in cash and restricted cash | $793,868 | $(5,372,718) | | Cash and restricted cash, end of period | $5,241,419 | $6,443,365 | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed information on the company's organization, significant accounting policies, financial instruments, debt, equity, commitments, related-party transactions, and subsequent events, offering crucial context to the condensed consolidated financial statements [Note 1: Organization, Nature of Business, and Liquidity](index=9&type=section&id=Note%201%3A%20Organization%2C%20Nature%20of%20Business%2C%20and%20Liquidity) This note outlines the company's business as a resort and entertainment entity focused on professional football, details a recent merger agreement, and highlights significant liquidity concerns, including recurring losses, substantial debt maturities, and the need for additional financing to continue as a going concern - The Company is a resort and entertainment company leveraging professional football, operating the Hall of Fame Village and DoubleTree by Hilton in Canton, Ohio, with a multi-pronged strategy across destination-based assets, media, and gaming[18](index=18&type=chunk) - On May 7, 2025, the Company entered into a Merger Agreement to be acquired by HOFV Holdings, LLC, with common stock holders receiving **$0.90 per share in cash**[23](index=23&type=chunk)[24](index=24&type=chunk) - The Company has sustained recurring losses, with an accumulated deficit of **$301.1 million** as of June 30, 2025, and faces approximately **$126 million in debt maturities** through June 30, 2026, raising substantial doubt about its ability to continue as a going concern[26](index=26&type=chunk)[31](index=31&type=chunk) [Note 2: Summary of Significant Accounting Policies](index=11&type=section&id=Note%202%3A%20Summary%20of%20Significant%20Accounting%20Policies) This note details the company's accounting policies, including basis of presentation, consolidation, use of estimates, warrant liability, cash and restricted cash, investments, equity method investments, accounts receivable, deferred financing costs, revenue recognition, income taxes, film and media costs, fair value measurement, net loss per common share, and recent accounting standards - The financial statements are unaudited and prepared in accordance with U.S. GAAP for interim financial information, requiring management to make significant estimates and assumptions[33](index=33&type=chunk)[38](index=38&type=chunk) - The Company accounts for warrants not indexed to its own stock as liabilities at fair value, subject to remeasurement at each balance sheet date, with changes recognized in other income (expense)[40](index=40&type=chunk) - Revenue is recognized following ASC 606, based on a five-step model, across various streams including sponsorships, rents, events, hotel operations, and gaming licenses, with recognition occurring when performance obligations are satisfied[58](index=58&type=chunk)[59](index=59&type=chunk)[60](index=60&type=chunk) [Note 3: Property and Equipment](index=20&type=section&id=Note%203%3A%20Property%20and%20Equipment) Property and equipment, net, decreased from $334.71 million at December 31, 2024, to $326.46 million at June 30, 2025, primarily due to accumulated depreciation, while project development costs remained relatively stable Property and Equipment (Unaudited) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------------------- | :------------ | :---------------- | | Property and equipment, net | $326,461,405 | $334,709,643 | | Project development costs | $10,319,809 | $10,404,499 | | Accumulated depreciation | $(96,465,051) | $(87,995,243) | | Depreciation expense (six months) | $8,469,808 | $8,339,941 | | Capitalized project development costs (six months) | $0 | $13,814,619 | - The company incurred **no capitalized project development costs** for the six months ended June 30, 2025, compared to **$13.81 million** in the prior year, indicating a slowdown in new development[97](index=97&type=chunk) [Note 4: Notes Payable, net](index=21&type=section&id=Note%204%3A%20Notes%20Payable%2C%20net) The company's net notes payable increased to $261.94 million as of June 30, 2025, from $245.75 million at December 31, 2024, with significant portions maturing in 2025. Several loan agreements, including those with CHCL, SCF, and IRG, were amended to extend maturity dates to September or December 2025 Notes Payable, Net (Unaudited) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------ | :------------ | :---------------- | | Total Gross Principal Payments | $266,591,513 | $251,364,649 | | Less: Debt discount and deferred financing costs | $(4,647,068) | $(5,616,833) | | Total Net Principal Payments | $261,944,445 | $245,747,816 | | Principal payments due in 2025 (six months) | $123,852,077 | N/A | - The CH Capital 2024 Loan facility amount was repeatedly increased from **$2 million to $15 million** through multiple amendments, with the maturity date extended to **September 30, 2025**, to fund general corporate purposes[111](index=111&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk)[246](index=246&type=chunk) - An omnibus extension was executed on March 31, 2025, extending the maturity date of several IRG-related debt instruments to **September 30, 2025**[127](index=127&type=chunk)[128](index=128&type=chunk) - The SCF Loan maturity date was extended from June 30, 2025, to **December 31, 2025**[124](index=124&type=chunk) [Note 5: Stockholders' Equity](index=27&type=section&id=Note%205%3A%20Stockholders'%20Equity) This note details the company's equity structure, including shares available under incentive plans, restricted stock unit activity, warrant information, and the status of Series A Cumulative Redeemable Preferred Stock, for which the company has missed required quarterly payments Stockholders' Equity Details (Unaudited) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------------------- | :------------ | :---------------- | | Shares available under 2020 Omnibus Incentive Plan | 134,108 | N/A | | Shares available under 2023 Inducement Plan | 62,652 | N/A | | Non-vested RSUs at June 30, 2025 | 13,323 | 203,046 (Jan 1, 2025) | | Stock-based compensation expense (six months) | $91,543 | $372,312 | | Warrants to purchase Common Stock | 3,681,403 | 3,681,403 | | Series A Preferred Stock outstanding | 6,800 shares | 6,800 shares | - The Company has not made its required quarterly payments for the **7.00% Series A Cumulative Redeemable Preferred Stock**, due beginning in the quarter ended December 31, 2024[148](index=148&type=chunk) [Note 6: Sponsorship Revenue and Associated Commitments](index=30&type=section&id=Note%206%3A%20Sponsorship%20Revenue%20and%20Associated%20Commitments) Sponsorship revenues for the three and six months ended June 30, 2025, were $0.64 million and $1.20 million, respectively, with future cash receipts totaling $6.90 million, primarily recognized on a straight-line basis over the agreement terms Sponsorship Revenue and Future Cash Receipts (Unaudited) | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :----------------------------------- | :------------------------------- | :----------------------------- | | Net sponsorship revenue | $636,546 | $1,202,809 | **Scheduled Future Cash to be Received Under Sponsorship Agreements (as of June 30, 2025):** | Year ending December 31, | Amount | | :----------------------- | :------------- | | 2025 (six months) | $817,552 | | 2026 | $2,116,714 | | 2027 | $1,447,390 | | 2028 | $1,257,265 | | 2029 | $1,257,265 | | Thereafter | $0 | | Total | $6,896,186 | [Note 7: Other Commitments](index=30&type=section&id=Note%207%3A%20Other%20Commitments) This note covers various operational commitments, including management agreements for hotel and restaurant operations, sports betting agreements, changes in executive leadership, and the company's delisting from Nasdaq due to non-compliance with listing rules - The management agreement with Shula's Steak Houses was terminated, and the restaurant was rebranded as 'Gridiron Gastropub' under company management as of October 22, 2024[159](index=159&type=chunk) - The Company secured conditional approval for mobile and retail sports betting in Ohio, with the deadline for accepting a retail sports bet extended to **December 31, 2027**[163](index=163&type=chunk)[164](index=164&type=chunk) - Michael Crawford resigned as President, CEO, and Chairman, effective May 18, 2025, receiving a **$300,000 retention bonus** and a consulting agreement. Karl L. Holz was elected non-executive Chairman, and new principal executive and financial officers were appointed[169](index=169&type=chunk)[170](index=170&type=chunk)[174](index=174&type=chunk)[176](index=176&type=chunk) - The Company was delisted from Nasdaq on **June 27, 2025**, due to failure to hold an annual meeting and maintain the minimum bid price, with its common stock now trading on the OTC Markets Pink Sheets[179](index=179&type=chunk)[180](index=180&type=chunk) [Note 8: Contingencies](index=34&type=section&id=Note%208%3A%20Contingencies) The company is subject to occasional legal proceedings and claims in the normal course of business but does not currently have any pending litigation that management believes would have a material adverse effect on its financial condition or operations - The Company does not have any pending litigation that, separately or in the aggregate, would have a material adverse effect on its results of operations, financial condition, or cash flows[184](index=184&type=chunk) [Note 9: Related-Party Transactions](index=34&type=section&id=Note%209%3A%20Related-Party%20Transactions) This note details significant related-party transactions, including non-interest bearing advances from affiliates, an amended global license agreement with PFHOF, a lease agreement with a director's affiliate, and commercial agreements with an equity-method investee, as well as other professional services and indemnity agreements Related-Party Balances (Unaudited) | Affiliate | June 30, 2025 | December 31, 2024 | | :---------------- | :------------ | :---------------- | | Due to IRG Member | $2,946,169 | $2,646,169 | | Due to PFHOF | $301,062 | $264,658 | | Total | $3,247,231 | $2,910,827 | - The Global License Agreement with PFHOF was amended, removing the requirement for annual license fees and waiving the **$600,000 fee for 2024**, in exchange for mutual agreement on license fees/royalties for future projects[192](index=192&type=chunk)[193](index=193&type=chunk) - The Company entered into a ten-year lease agreement for commercial office space with Touchdown Work Place, LLC, an entity managed by Stuart Lichter, a director of the Company[197](index=197&type=chunk) [Note 10: Concentrations](index=37&type=section&id=Note%2010%3A%20Concentrations) The company has significant customer concentrations, with two customers representing a substantial portion of sponsorship revenue and four customers accounting for a large percentage of accounts receivable. Additionally, cash balances are held at third-party financial institutions, potentially exceeding federally insured limits - For the three months ended June 30, 2025, two customers represented approximately **48.9% and 14.6% of sponsorship revenue**. For the six months ended June 30, 2025, two customers represented approximately **50.0% and 14.9% of sponsorship revenue**[206](index=206&type=chunk)[207](index=207&type=chunk) - As of June 30, 2025, four customers represented approximately **19.6%, 10.7%, 10.6%, and 10.3% of the Company's accounts receivable**[210](index=210&type=chunk) - Cash and restricted cash balances at national financial institutions may exceed federally insured limits, posing a risk if these institutions fail[211](index=211&type=chunk) [Note 11: Leases](index=38&type=section&id=Note%2011%3A%20Leases) This note details the company's operating and finance lease arrangements as both a lessee and a lessor, including right-of-use assets, lease liabilities, lease costs, and future minimum lease payments and revenues Lease Assets and Liabilities (Unaudited) | Lease Type | June 30, 2025 (ROU Assets) | June 30, 2025 (Lease Liability) | | :---------------- | :-------------------------- | :------------------------------ | | Operating leases | $7,062,678 | $3,347,078 | | Financing leases | $66,907 | $47,550 | - Operating lease costs for the six months ended June 30, 2025, were **$246,023**, with a weighted-average remaining lease term of **89.3 years** and a discount rate of **10.0%**[218](index=218&type=chunk) - Lease revenue from lessor commitments for the six months ended June 30, 2025, was **$717,012**, with total future minimum lease revenue of **$9.29 million**[224](index=224&type=chunk) [Note 12: Financing Liability](index=41&type=section&id=Note%2012%3A%20Financing%20Liability) The company accounts for a sale-leaseback transaction of its Fan Engagement Zone as a financing arrangement, with a carrying value of $17.80 million as of June 30, 2025. A waterpark ground lease was terminated due to default, leading to potential damages and the landlord retaining rights to collateral including the Tom Benson Hall of Fame Stadium and a 20% interest in ForeverLawn Park - A sale-leaseback of the Fan Engagement Zone is accounted for as a financing transaction, with a carrying value of **$17,800,270** as of June 30, 2025, representing **$367,579,171** in remaining undiscounted payments[228](index=228&type=chunk)[238](index=238&type=chunk) - The waterpark ground lease was terminated on **October 26, 2024**, due to a payment default of approximately **$2.6 million**, entitling the landlord to pursue remedies and collateral, including the Tom Benson Hall of Fame Stadium and a **20% interest in ForeverLawn Park**[229](index=229&type=chunk)[230](index=230&type=chunk)[234](index=234&type=chunk)[236](index=236&type=chunk) - A Lease Restructuring LOI was entered into on **April 17, 2025**, outlining non-binding terms for the waterpark and other properties, and a binding breakage fee of **$1,988,186** if the restructuring does not close by **September 30, 2025**, due to a willful breach by an affiliate of director Stuart Lichter[235](index=235&type=chunk) [Note 13: Subsequent Events](index=43&type=section&id=Note%2013%3A%20Subsequent%20Events) Subsequent to June 30, 2025, the US government enacted the OBBB Act, the company received a notice of default on its Fan Engagement Zone lease which was subsequently cured, and the CHCL loan facility was further increased to $15 million - On **July 4, 2025**, the US government enacted the One Big Beautiful Tax Bill Act (OBBB), and the Company is evaluating its impact on financial statements[240](index=240&type=chunk) - On **July 18, 2025**, the Company received a default notice for unpaid rent on the Fan Engagement Zone lease (**$283,915**), which was cured on **July 23, 2025**, through an advance from CHCL[242](index=242&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk) - On **July 24, 2025**, the CHCL loan facility was increased from **$14 million to $15 million** through a Ninth Amendment to the Note and Security Agreement[245](index=245&type=chunk)[246](index=246&type=chunk) [Item 2. Management's discussion and analysis of financial condition and results of operations](index=45&type=section&id=Item%202.%20Management's%20discussion%20and%20analysis%20of%20financial%20condition%20and%20results%20of%20operations) This section provides management's perspective on the company's financial condition, operational results, and liquidity, highlighting business strategy, recent developments including delisting and debt amendments, and a detailed comparison of financial performance for the three and six months ended June 30, 2025, versus 2024, emphasizing ongoing liquidity challenges [Business Overview](index=45&type=section&id=Business%20Overview) Hall of Fame Resort & Entertainment Company operates as a resort and entertainment entity, leveraging professional football through its Hall of Fame Village, DoubleTree by Hilton, and diversified revenue streams across destination-based assets, media, and gaming, with ongoing Phase I and Phase II developments and future Phase III expansion plans - The Company is a resort and entertainment company focused on professional football, operating the Hall of Fame Village and DoubleTree by Hilton in Canton, Ohio[249](index=249&type=chunk) - Strategic verticals include destination-based assets (Hall of Fame Village), Hall of Fame Village Media, and Gold Summit Gaming, with Phase I operational and Phase II components developed[249](index=249&type=chunk)[250](index=250&type=chunk)[252](index=252&type=chunk) - The Company holds licenses for physical and online sports betting in Ohio and has an agreement with Betr as its mobile management services provider[251](index=251&type=chunk) [Key Components of the Company's Results of Operations](index=46&type=section&id=Key%20Components%20of%20the%20Company's%20Results%20of%20Operations) The company's revenue streams include sponsorships, rents, events, hotel and restaurant operations, media content, and gaming licenses, with expectations for continued growth. Operating expenses, encompassing event/media production, personnel, maintenance, food & beverage, hotel operations, and depreciation, are anticipated to rise with further development - Revenue is generated from sponsorships, rents, events, exclusive programming, attractions, hotel and restaurant operations, media content, and gaming licenses[253](index=253&type=chunk)[255](index=255&type=chunk) - Operating expenses include event/media production, personnel, campus maintenance, food and beverage costs, hotel operating expenses, and depreciation, expected to increase with asset completion and development[257](index=257&type=chunk) [Recent Developments](index=46&type=section&id=Recent%20Developments) Recent developments include the company's delisting from Nasdaq due to non-compliance with listing rules, multiple amendments to the CH Capital 2024 Loan increasing its facility amount, the resignation of the CEO, omnibus extensions of various debt instruments, and a proposed take-private merger agreement - The Company was delisted from Nasdaq on **June 27, 2025**, due to failure to hold an annual meeting and maintain the minimum bid price, with its common stock now trading on the OTC Markets Pink Sheets[179](index=179&type=chunk)[180](index=180&type=chunk)[259](index=259&type=chunk)[262](index=262&type=chunk) - Multiple amendments (Second through Ninth) to the CH Capital 2024 Loan increased the facility amount from **$2 million to $15 million** for general corporate purposes, with the maturity date extended to **September 30, 2025**[266](index=266&type=chunk)[269](index=269&type=chunk)[270](index=270&type=chunk)[277](index=277&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk)[286](index=286&type=chunk) - Michael Crawford resigned as President, CEO, and Chairman, effective **May 18, 2025**, and entered into a retention and consulting agreement[271](index=271&type=chunk)[272](index=272&type=chunk)[273](index=273&type=chunk) - An Agreement and Plan of Merger was entered into on **May 7, 2025**, for a take-private transaction where common stockholders would receive **$0.90 per share in cash**[279](index=279&type=chunk)[280](index=280&type=chunk) [Results of Operations](index=52&type=section&id=Results%20of%20Operations) The company reported a reduced net loss for both the three and six months ended June 30, 2025, compared to the prior year, driven by decreased operating expenses and interest expense, despite a decline in total revenues [Three Months Ended June 30, 2025 as Compared to the Three Months Ended June 30, 2024](index=53&type=section&id=Three%20Months%20Ended%20June%2030%2C%202025%20as%20Compared%20to%20the%20Three%20Months%20Ended%20June%2030%2C%202024) For the three months ended June 30, 2025, net loss decreased by $3.59 million, primarily due to a $2.98 million reduction in operating expenses and a $0.50 million decrease in interest expense, despite a $0.36 million decline in total revenues Financial Performance for Three Months Ended June 30 (Unaudited) | Metric | 2025 (3 months) | 2024 (3 months) | Change ($) | Change (%) | | :----------------------------------- | :-------------- | :-------------- | :--------- | :--------- | | Total revenues | $4,342,269 | $4,699,669 | $(357,400) | -7.6% | | Operating expenses | $4,220,719 | $7,199,196 | $(2,978,477) | -41.4% | | Hotel operating expenses | $1,604,243 | $1,708,961 | $(104,718) | -6.1% | | Interest expense, net | $(5,978,073) | $(6,475,614) | $497,541 | -7.7% | | Amortization of discount on note payable | $(236,773) | $(1,054,650) | $817,877 | -77.5% | | Net loss attributable to HOFRE stockholders | $(12,161,606) | $(15,754,982) | $3,593,376 | -22.8% | - Sponsorship revenues increased slightly by **1.5%** due to new contracts, while event, rents, restaurant, and other revenues decreased by **15.7%** due to fewer events and lower sales[289](index=289&type=chunk)[290](index=290&type=chunk) [Six Months Ended June 30, 2025 as Compared to the Six Months Ended June 30, 2024](index=55&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20as%20Compared%20to%20the%20Six%20Months%20Ended%20June%2030%2C%202024) For the six months ended June 30, 2025, the net loss decreased by $3.15 million, primarily driven by a $3.46 million reduction in operating expenses and a $1.49 million decrease in interest expense, despite a $1.60 million decline in total revenues Financial Performance for Six Months Ended June 30 (Unaudited) | Metric | 2025 (6 months) | 2024 (6 months) | Change ($) | Change (%) | | :----------------------------------- | :-------------- | :-------------- | :--------- | :--------- | | Total revenues | $7,287,602 | $8,890,984 | $(1,603,382) | -18.0% | | Operating expenses | $9,889,854 | $13,349,560 | $(3,459,706) | -25.9% | | Hotel operating expenses | $3,018,944 | $2,683,393 | $335,551 | 12.5% | | Interest expense, net | $(11,502,527) | $(12,997,148) | $1,494,621 | -11.5% | | Amortization of discount on note payable | $(1,385,492) | $(2,009,972) | $624,480 | -31.1% | | Net loss attributable to HOFRE stockholders | $(27,496,556) | $(30,642,570) | $3,146,014 | -10.3% | - Sponsorship revenues decreased by **15.7%** due to the expiration of certain agreements, and event, rents, restaurant, and other revenues decreased by **30.3%** due to fewer large-scale events[303](index=303&type=chunk)[304](index=304&type=chunk) [Liquidity and Capital Resources](index=58&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces significant liquidity challenges, with recurring losses, an accumulated deficit of $301.1 million, and $126 million in debt maturing by June 30, 2026. It relies on debt and equity issuances, including loans from affiliates, and needs additional financing to fund operations and development, raising substantial doubt about its going concern ability - The Company has sustained recurring losses, with an accumulated deficit of **$301.1 million** as of June 30, 2025[316](index=316&type=chunk) - Approximately **$126 million in debt principal payments** are due through June 30, 2026[316](index=316&type=chunk) - The Company's operations are funded principally through debt and equity, including loans from CHCL and other affiliates, and it requires additional financing to fund development and working capital, raising substantial doubt about its ability to continue as a going concern[316](index=316&type=chunk)[317](index=317&type=chunk)[318](index=318&type=chunk) [Cash Flows](index=58&type=section&id=Cash%20Flows) For the six months ended June 30, 2025, net cash used in operating activities increased to $6.3 million, while net cash used in investing activities significantly decreased to $0.1 million. Net cash provided by financing activities increased to $7.2 million, resulting in a net increase in cash and restricted cash of $0.79 million Cash Flow Summary (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Operating Activities | $(6,304,920) | $(5,310,177) | | Investing Activities | $(122,732) | $(3,777,401) | | Financing Activities | $7,221,520 | $3,714,860 | | Net increase (decrease) in cash and restricted cash | $793,868 | $(5,372,718) | [Off-Balance Sheet Arrangements](index=59&type=section&id=Off-Balance%20Sheet%20Arrangements) As of June 30, 2025, the company did not have any off-balance sheet arrangements - The Company did not have any off-balance sheet arrangements as of June 30, 2025[323](index=323&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=59&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions in accordance with U.S. GAAP, which are detailed in Note 2 to the financial statements - The financial statements are prepared in accordance with U.S. GAAP, requiring management to make estimates and assumptions that affect reported amounts[324](index=324&type=chunk) - Significant accounting policies and estimates are further detailed in Note 2 to the Unaudited Condensed Consolidated Financial Statements[325](index=325&type=chunk) [Item 3. Quantitative and qualitative disclosures about market risk](index=60&type=section&id=Item%203.%20Quantitative%20and%20qualitative%20disclosures%20about%20market%20risk) This item is not applicable for the reporting period - Item 3, Quantitative and qualitative disclosures about market risk, is not applicable[326](index=326&type=chunk) [Item 4. Controls and procedures](index=60&type=section&id=Item%204.%20Controls%20and%20procedures) The company's disclosure controls and procedures were deemed ineffective as of June 30, 2025, due to previously disclosed material weaknesses in internal control over financial reporting related to the review and analysis of financial information and non-routine transactions. Remediation efforts are ongoing, but their full effectiveness is yet to be determined - As of **June 30, 2025**, the Company's disclosure controls and procedures were not effective at the reasonable assurance level due to material weaknesses in internal control over financial reporting[329](index=329&type=chunk) - Material weaknesses were identified in the precise and timely review and analysis of information for financial statements and disclosures, and in controls over non-routine transactions[328](index=328&type=chunk) - Remediation plans are being implemented, but it is not yet determined if these steps will fully remediate the material weaknesses[328](index=328&type=chunk)[330](index=330&type=chunk) [PART II. OTHER INFORMATION](index=61&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal proceedings](index=61&type=section&id=Item%201.%20Legal%20proceedings) The company is subject to occasional legal proceedings and claims in the normal course of business but does not have any pending litigation that management believes would have a material adverse effect on its financial condition or operations - The Company does not have any pending litigation that, separately or in the aggregate, would have a material adverse effect on its results of operations, financial condition, or cash flows[332](index=332&type=chunk) [Item 1A. Risk factors](index=61&type=section&id=Item%201A.%20Risk%20factors) There have been no material changes to the company's risk factors since its Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to risk factors have occurred since the Annual Report on Form 10-K for the year ended December 31, 2024[333](index=333&type=chunk) [Item 2. Unregistered sales of equity securities and use of proceeds](index=61&type=section&id=Item%202.%20Unregistered%20sales%20of%20equity%20securities%20and%20use%20of%20proceeds) There were no unregistered sales of equity securities or use of proceeds to report for this period - There were no unregistered sales of equity securities and use of proceeds to report[334](index=334&type=chunk) [Item 3. Defaults upon senior securities](index=61&type=section&id=Item%203.%20Defaults%20upon%20senior%20securities) There were no defaults upon senior securities to report for this period - There were no defaults upon senior securities to report[335](index=335&type=chunk) [Item 4. Mine safety disclosures](index=61&type=section&id=Item%204.%20Mine%20safety%20disclosures) This item is not applicable for the reporting period - Item 4, Mine safety disclosures, is not applicable[336](index=336&type=chunk) [Item 5. Other information](index=61&type=section&id=Item%205.%20Other%20information) There is no other information to report for this period - There is no other information to report[337](index=337&type=chunk) [Item 6. Exhibits](index=62&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including the Agreement and Plan of Merger, various amendments to note and security agreements, a voting agreement, and certifications - Key exhibits include the Agreement and Plan of Merger (**May 7, 2025**), multiple amendments to the Note & Security Agreement with CH Capital Lending, LLC, and the First Amendment to Business Loan Agreement with Stark Community Foundation[338](index=338&type=chunk) [SIGNATURES](index=63&type=section&id=SIGNATURES) The report is duly signed on behalf of the registrant by the Executive Vice President of Business Administration (Interim Principal Executive Officer), Senior Vice President of Finance (Interim Principal Financial Officer), and Vice President of Accounting/Corporate Controller (Principal Accounting Officer) as of August 12, 2025 - The report is signed by Lisa Gould (Executive Vice President of Business Administration, Interim Principal Executive Officer), Eric Hess (Senior Vice President of Finance, Interim Principal Financial Officer), and John Van Buiten (Vice President of Accounting/Corporate Controller, Principal Accounting Officer) on **August 12, 2025**[341](index=341&type=chunk)

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20statements) Q1 2025 financial statements reveal declining assets, increased deficit, reduced equity, and persistent net losses, raising going concern doubts [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets decreased, liabilities increased, and total equity significantly declined due to a growing accumulated deficit Condensed Consolidated Balance Sheet Highlights (unaudited) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $545,318 | $432,174 | | Total Assets | $364,686,678 | $366,705,811 | | **Liabilities & Equity** | | | | Notes payable, net | $251,947,817 | $245,747,816 | | Total Liabilities | $307,721,329 | $294,474,352 | | Accumulated Deficit | $(288,896,879) | $(273,561,929) | | Total Equity | $56,965,349 | $72,231,459 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 saw a 30% revenue decline, widening operating loss, and increased net loss attributable to stockholders, with flat net loss per share Condensed Consolidated Statements of Operations (unaudited) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total Revenues | $2,945,333 | $4,191,315 | | Loss from Operations | $(8,372,328) | $(7,092,231) | | Net Loss | $(15,068,950) | $(14,630,176) | | Net Loss Attributable to HOFRE Stockholders | $(15,334,950) | $(14,887,588) | | Net Loss Per Share (basic and diluted) | $(2.30) | $(2.30) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 saw improved operating cash flow, reduced investing cash outflow, increased financing cash inflow, resulting in a slight net cash increase Summary of Cash Flows (unaudited) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(1,465,710) | $(2,476,875) | | Net Cash Used in Investing Activities | $(102,800) | $(2,967,807) | | Net Cash Provided by Financing Activities | $1,645,632 | $512,766 | | **Net Increase (Decrease) in Cash** | **$77,122** | **$(4,931,916)** | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, going concern warning, debt defaults, related-party transactions, lease termination, Nasdaq delisting, and a subsequent merger agreement - The company has sustained recurring losses, with an accumulated deficit of **$288.9 million** as of March 31, 2025. It has approximately **$117 million** of debt coming due through March 31, 2026, and cash flows from operations are insufficient to meet operating costs. These conditions raise substantial doubt about the company's ability to continue as a going concern[25](index=25&type=chunk)[27](index=27&type=chunk) - On October 26, 2024, the company received a notice of termination for its waterpark ground lease due to an event of default. This default triggered cross-defaults on other loan agreements totaling approximately **$81 million** in principal[26](index=26&type=chunk) - On May 7, 2025, the company entered into an Agreement and Plan of Merger with HOFV Holdings, LLC, an affiliate of director Stuart Lichter. Under the agreement, each share of common stock will be converted into the right to receive **$0.90** in cash, and the company will become a wholly owned subsidiary of the buyer[228](index=228&type=chunk)[229](index=229&type=chunk) - On April 10, 2025, the company received a deficiency letter from Nasdaq because its common stock bid price had closed below **$1.00** per share for 30 consecutive business days. The company has 180 calendar days to regain compliance[220](index=220&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=42&type=section&id=Item%202.%20Management's%20discussion%20and%20analysis%20of%20financial%20condition%20and%20results%20of%20operations) Management discusses Q1 2025 revenue decline, widening operating loss, severe liquidity constraints, and substantial doubt about the company's ability to continue as a going concern Results of Operations Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Sponsorships, net | $566,263 | $859,731 | (34.1)% | | Event, rents, restaurant, etc. | $1,110,645 | $2,054,877 | (46.0)% | | **Total Revenues** | **$2,945,333** | **$4,191,315** | **(29.7)%** | | Total Operating Expenses | $11,317,661 | $11,283,546 | 0.3% | | **Loss from Operations** | **$(8,372,328)** | **$(7,092,231)** | **(18.1)%** | | **Net Loss** | **$(15,068,950)** | **$(14,630,176)** | **(3.0)%** | - The company's cash position is deficient as of May 13, 2025, and certain operational payments are not being made in the ordinary course of business. The company is seeking additional funding, but there are no assurances it can be raised on acceptable terms, if at all[277](index=277&type=chunk)[279](index=279&type=chunk) - On May 7, 2025, the company entered into a merger agreement to be taken private by an affiliate of director Stuart Lichter. The transaction was approved by the Board based on the unanimous recommendation of a special committee of independent directors[262](index=262&type=chunk)[264](index=264&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20qualitative%20disclosures%20about%20market%20risk) The company states that this item is not applicable - Not applicable[287](index=287&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20procedures) Management concluded that disclosure controls and procedures were ineffective due to material weaknesses in internal control over financial reporting - The company identified material weaknesses in internal control over financial reporting related to the review of financial statements and controls over non-routine transactions[289](index=289&type=chunk) - Due to these material weaknesses, the Chief Executive Officer and Vice President Accounting / Corporate Controller concluded that disclosure controls and procedures were not effective as of March 31, 2025[290](index=290&type=chunk) [PART II. OTHER INFORMATION](index=52&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20proceedings) The company reports no pending litigation that would materially adversely affect its financial condition or results of operations - The Company does not have any pending litigation that would have a material adverse effect on its results of operations, financial condition, or cash flows[293](index=293&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20factors) No material changes to risk factors have occurred since the prior annual report filing - No material changes to risk factors have occurred since the filing of the Annual Report on Form 10-K for the year ended December 31, 2024[294](index=294&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=Item%202.%20Unregistered%20sales%20of%20equity%20securities%20and%20use%20of%20proceeds) The company reported no unregistered sales of equity securities during the period - None[295](index=295&type=chunk) [Item 3. Defaults Upon Senior Securities](index=52&type=section&id=Item%203.%20Defaults%20upon%20senior%20securities) The company reported no defaults upon senior securities during the period - None[296](index=296&type=chunk) [Item 5. Other Information](index=52&type=section&id=Item%205.%20Other%20information) The company reported no other information for this item - None[298](index=298&type=chunk) [Item 6. Exhibits](index=53&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including various agreements and required certifications

Group 1 - Monteverde & Associates PC has recovered millions for shareholders and is recognized as a Top 50 Firm in the 2024 ISS Securities Class Action Services Report [1] - The firm is investigating Hall of Fame Resort & Entertainment Company (NASDAQ: HOFV) regarding a proposed merger with HOFV Holdings, LLC, an affiliate of Industrial Realty Group, LLC [1] - Under the merger agreement, the Investor will acquire all outstanding shares of the Company's common stock not currently owned by IRG and its affiliates for $0.90 per share in cash [1] Group 2 - Monteverde & Associates PC is a national class action securities firm with a successful track record in trial and appellate courts, including the U.S. Supreme Court [2] - The firm operates from the Empire State Building in New York City [2] - The firm encourages shareholders with concerns to contact them for additional information free of charge [3]

PART I [Item 1. Business](index=6&type=section&id=Item%201.%20Business) HOFRE operates Hall of Fame Village, a multi-phase resort and entertainment complex leveraging professional football, diversifying revenue through destination assets, media, and gaming - HOFRE operates Hall of Fame Village, a multi-use sports and entertainment destination leveraging professional football, with a strategy spanning destination assets, media, and gaming[15](index=15&type=chunk) - Phase I of Hall of Fame Village is operational, encompassing Tom Benson Hall of Fame Stadium, the **80% sold ForeverLawn Sports Complex**, and Hall of Fame Village Media[16](index=16&type=chunk)[22](index=22&type=chunk) - Phase II development includes the Constellation Center for Excellence, Center for Performance, Play Action Plaza, Fan Engagement Zone, and two hotels, with Phase III planning for residential and additional attractions[18](index=18&type=chunk)[38](index=38&type=chunk) - The company holds licenses for physical and online sports betting in Ohio, partnering with Betr for mobile services and hosting eSports tournaments[17](index=17&type=chunk)[39](index=39&type=chunk) - The waterpark ground lease was terminated on **October 26, 2024**, due to a non-payment default, requiring surrender of premises and improvements[23](index=23&type=chunk)[69](index=69&type=chunk) [Recent Developments](index=11&type=section&id=Recent%20Developments) Key recent developments include amendments to equity and loan agreements, a significant state grant, termination of a management contract, and the CEO's resignation - The Equity Distribution Agreement was amended on **April 8, 2024**, increasing agent compensation to **4.0% of gross offering proceeds**, but the ATM facility expired on **September 14, 2024**[49](index=49&type=chunk)[50](index=50&type=chunk) - Multiple loan agreements with Stark County Port Authority, City of Canton, Stark Community Foundation, and NewMarket Project Inc. were amended in **May-June 2024**, generally extending maturity dates (e.g., to **2044 or 2046**) and, in some cases, increasing principal balances or deferring interest payments[51](index=51&type=chunk)[52](index=52&type=chunk)[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) - The Company received a **$9.8 million grant** from the State of Ohio on **August 9, 2024**, for Hall of Fame Village operations[67](index=67&type=chunk) - The management agreement with Shula's Steak Houses was terminated, with the Company taking over management and rebranding the restaurant as 'Gridiron Gastropub' on **August 18, 2024**[68](index=68&type=chunk) - On **October 26, 2024**, the waterpark ground lease was terminated due to a payment default of approximately **$2.6 million**, leading to an event of default under loan agreements totaling **$81 million**[69](index=69&type=chunk)[70](index=70&type=chunk)[73](index=73&type=chunk) - On **September 27, 2024**, a non-binding proposal was received from IRG Canton Village Member, LLC to take the Company private, which is currently under evaluation by a Special Committee[78](index=78&type=chunk) - Michael Crawford resigned as President, CEO, and Chairman, effective **May 18, 2025**, and entered into a retention and consulting agreement for a **$300,000 bonus** and consulting fees[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk) [Item 1A. Risk Factors.](index=16&type=section&id=Item%201A.%20Risk%20Factors.) The Company faces significant risks including recurring losses, substantial debt, going concern doubt, waterpark lease default, take-private uncertainty, and potential Nasdaq delisting - The Company is an early-stage company with a history of losses and expects to incur significant expenses and continuing losses during the construction of Hall of Fame Village[93](index=93&type=chunk)[96](index=96&type=chunk) Total Consolidated Debt Outstanding | As of Date | Amount (approx.) | | :----------- | :--------------- | | Dec 31, 2024 | $251.2 million | - Recurring losses, significant debt, and a deficient cash position (approx. **$0.4 million unrestricted cash** as of **Dec 31, 2024**) raise substantial doubt about the Company's ability to continue as a going concern, with **$109.5 million in debt principal payments** due through **December 31, 2025**[101](index=101&type=chunk) - The termination of the waterpark ground lease on **October 26, 2024**, due to a **$2.6 million payment default**, triggered events of default under approximately **$81 million** of the Company's loan agreements[104](index=104&type=chunk)[105](index=105&type=chunk)[108](index=108&type=chunk) - The non-binding proposal from IRG Canton Village Member, LLC to take the Company private has no assurance of resulting in a definitive transaction, and its failure could adversely impact the stock price[109](index=109&type=chunk)[110](index=110&type=chunk) - The Company faces risks related to attracting and retaining key employees, including the recent resignation of the President, CEO, and Chairman, Michael Crawford[113](index=113&type=chunk)[116](index=116&type=chunk) - Failure to comply with Nasdaq's continued listing standards (e.g., minimum bid price, annual meeting requirement) could lead to delisting, negatively affecting stock liquidity and market price[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - Material weaknesses in internal control over financial reporting were identified as of **December 31, 2024**, related to the review and analysis of financial statement information and controls over non-routine transactions[151](index=151&type=chunk)[152](index=152&type=chunk) [Item 1B. Unresolved Staff Comments.](index=29&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) The Company has no unresolved staff comments to report - Not applicable[170](index=170&type=chunk) [Item 1C. Cybersecurity.](index=29&type=section&id=Item%201C.%20Cybersecurity.) The Company has established policies and processes for assessing, identifying, and managing cybersecurity risks, with Board oversight and no material challenges to date - The Company has established policies and processes for assessing, identifying, and managing material cybersecurity threats, integrated into its overall risk management systems[171](index=171&type=chunk) - Periodic risk assessments are conducted to identify threats, evaluate likelihood and potential damage, and assess the sufficiency of existing safeguards, often with consultant assistance[172](index=172&type=chunk)[175](index=175&type=chunk) - The Board of Directors and Audit Committee provide oversight of cybersecurity risk management, with the CEO, Assistant General Counsel, and Chief Accounting Officer primarily responsible for day-to-day management[177](index=177&type=chunk)[178](index=178&type=chunk)[180](index=180&type=chunk) - To date, the Company has not encountered cybersecurity challenges that have materially impaired its operations or financial standing[176](index=176&type=chunk) [Item 2. Properties.](index=30&type=section&id=Item%202.%20Properties.) The Company owns real property in Canton, Ohio, for Hall of Fame Village and the DoubleTree Hotel, with certain parcels subject to ground leases and mortgages, and recent asset dispositions - The Company owns real property in Canton, Ohio, for the Hall of Fame Village and the DoubleTree by Hilton Hotel[182](index=182&type=chunk) - Certain Hall of Fame Village parcels, including the Tom Benson Hall of Fame Stadium, are subject to long-term ground leases with the Canton City School District[182](index=182&type=chunk) - On **January 11, 2024**, the Company sold an **80% interest** in the ForeverLawn Sports Complex[183](index=183&type=chunk) - The waterpark ground lease was terminated on **October 26, 2024**, due to a non-payment event of default, requiring the surrender of the premises[184](index=184&type=chunk) [Item 3. Legal Proceedings.](index=30&type=section&id=Item%203.%20Legal%20Proceedings.) Information regarding legal proceedings is incorporated by reference from Note 8, 'Contingencies,' to the Company's Consolidated Financial Statements - Legal proceedings information is detailed in Note 8, 'Contingencies,' of the Consolidated Financial Statements[185](index=185&type=chunk) [Item 4. Mine Safety Disclosures.](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) Mine safety disclosures are not applicable to the Company - Not applicable[186](index=186&type=chunk) PART II [Item 5. Market For Registrant's Common Equity, Related Stockholder Matters And Issuer's Purchases Of Equity Securities.](index=31&type=section&id=Item%205.%20Market%20For%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20And%20Issuer%27s%20Purchases%20Of%20Equity%20Securities.) The Company's Common Stock trades on NASDAQ under "HOFV" with 90 holders of record as of March 21, 2025, and no history or intention of paying cash dividends - The Company's Common Stock trades on The NASDAQ Capital Market under the symbol "**HOFV**"[187](index=187&type=chunk) Common Stock Holders | As of Date | Holders of Record | | :----------- | :---------------- | | Mar 21, 2025 | 90 | - The Company has never paid cash dividends on its Common Stock and does not intend to in the foreseeable future[189](index=189&type=chunk) [Item 6. [Reserved]](index=31&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.](index=31&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) The Company, a resort and entertainment entity, continues to incur losses and faces significant liquidity challenges, with total revenues decreasing by **12.1%** in 2024 and net loss improving to **$55.9 million** - The Company is a resort and entertainment company focused on professional football, operating the Hall of Fame Village with diversified revenue streams across destination-based assets, media, and gaming[192](index=192&type=chunk) - The Company generates revenue from sponsorships, rents, events, exclusive programming, attractions, and hotel and restaurant operations, with expected increases as additional assets and events are introduced[196](index=196&type=chunk)[199](index=199&type=chunk) - Operating expenses include event/media production, personnel, campus maintenance, food and beverage costs, hotel operations, and depreciation, expected to increase with further Phase II asset completion and event programming[200](index=200&type=chunk) Key Financial Performance (Years Ended December 31) | Metric | 2024 | 2023 | Change ($) | Change (%) | | :---------------------------------------- | :------------- | :------------- | :------------- | :--------- | | Total revenues | $21,205,933 | $24,129,673 | $(2,923,740) | -12.1% | | Operating expenses | $27,883,661 | $43,171,407 | $(15,287,746) | -35.4% | | Hotel operating expenses | $5,981,485 | $6,491,625 | $(510,140) | -7.9% | | Impairment expense | $0 | $8,845,000 | $(8,845,000) | -100.0% | | Depreciation expense | $17,007,248 | $15,069,782 | $1,937,466 | 12.9% | | Loss from operations | $(29,666,461) | $(49,448,141) | $19,781,680 | 40.0% | | Interest expense, net | $(27,284,545) | $(18,763,838) | $(8,520,707) | 45.4% | | Government grant | $9,763,126 | $0 | $9,763,126 | N/A | | Change in fair value of warrant liability | $150,000 | $686,000 | $(536,000) | -78.1% | | Loss on termination of financing liability| $(5,168,550) | $0 | $(5,168,550) | N/A | | Net loss | $(55,862,635) | $(68,753,804) | $12,891,169 | 18.7% | | Net loss per share – basic and diluted | $(8.72) | $(11.97) | $3.25 | 27.1% | - The Company has sustained recurring losses, with an accumulated deficit of **$273.6 million** as of **December 31, 2024**, and had **$0.4 million** in unrestricted cash and **$4.0 million** in restricted cash, with **$109.5 million in debt principal payments** due by **December 31, 2025**[223](index=223&type=chunk) Cash Flow Summary (Years Ended December 31) | Activity | 2024 | 2023 | | :----------------- | :-------------- | :-------------- | | Operating Activities | $(10,914,970) | $(27,000,438) | | Investing Activities | $(7,767,670) | $(27,826,165) | | Financing Activities | $11,314,108 | $33,126,304 | | Net decrease in cash and restricted cash | $(7,368,532) | $(21,700,299) | [Item 7A. Quantitative and Qualitative Disclosure About Market Risk.](index=38&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk.) The Company is not exposed to market risk related to interest rates on foreign currencies - The Company is not exposed to market risk related to interest rates on foreign currencies[237](index=237&type=chunk) [Item 8. Financial Statements and Supplementary Data.](index=38&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) The financial statements required by this Item are included in Item 15 of this report, starting on page F-1 - Financial statements are located starting on page F-1 of this report[238](index=238&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.](index=38&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure.) There have been no changes in or disagreements with accountants on accounting and financial disclosure - None[239](index=239&type=chunk) [Item 9A. Controls and Procedures.](index=38&type=section&id=Item%209A.%20Controls%20and%20Procedures.) As of December 31, 2024, the Company's disclosure controls were ineffective due to material weaknesses in financial reporting, though management concluded financial statements are fairly presented - As of **December 31, 2024**, the Company's disclosure controls and procedures were not effective due to material weaknesses in internal control over financial reporting[240](index=240&type=chunk)[244](index=244&type=chunk) - Material weaknesses were identified related to the precise and timely review and analysis of information for financial statements and disclosures, and ineffective control activities surrounding non-routine transactions[245](index=245&type=chunk) - Management is implementing remediation efforts, including designing and testing additional business process controls, but these efforts are ongoing and not yet fully remediated[246](index=246&type=chunk)[250](index=250&type=chunk) - Despite the material weaknesses, management concluded that the consolidated financial statements in this Annual Report on Form 10-K fairly present the Company's financial position, results of operations, and cash flows in conformity with U.S. GAAP[241](index=241&type=chunk)[154](index=154&type=chunk) [Item 9B. Other Information.](index=39&type=section&id=Item%209B.%20Other%20Information.) There is no other information to report under this item - None[248](index=248&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.](index=39&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections.) This item is not applicable to the Company - Not Applicable[249](index=249&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance.](index=40&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance.) The Company's Board of Directors, with eight members and six independent, oversees risk management through committees, and has policies on insider trading and ethics Directors as of March 26, 2025 | Name | Age | Position | | :---------------- | :-- | :------------------------------------- | | Michael Crawford | 57 | President and Chief Executive Officer, Chairman | | Marcus LaMarr Allen | 65 | Director | | Anthony J. Buzzelli | 76 | Director, Audit Committee Chair | | David Dennis | 67 | Director | | Karl L. Holz | 74 | Director, Lead Independent Director | | Stuart Lichter | 76 | Director | | Mary Owen | 47 | Director, Nominating and Corporate Governance Committee Chair | | Kimberly K. Schaefer | 59 | Director, Compensation Committee Chair | Executive Officers as of March 21, 2025 | Name | Age | Position | | :---------------- | :-- | :-------------------------------------------- | | Michael Crawford | 57 | President, Chief Executive Officer and Chairman | | Lisa Gould | 49 | Senior Vice President of Human Resources & Information Technology | | Anne Graffice | 53 | Executive Vice President of Global Marketing and Public Affairs | | John Van Buiten | 38 | Vice President of Accounting / Corporate Controller | - The Board is divided into three classes with staggered three-year terms, with **six directors** identified as independent[277](index=277&type=chunk)[280](index=280&type=chunk) - The Board has overall responsibility for risk oversight, supported by its Audit, Compensation, and Nominating and Corporate Governance Committees[285](index=285&type=chunk) - The Company has adopted an Insider Trading Policy prohibiting hedging and speculative transactions, and a Code of Business Conduct and Ethics applicable to all directors, executive officers, and employees[296](index=296&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk) [Item 11. Executive Compensation.](index=49&type=section&id=Item%2011.%20Executive%20Compensation.) Executive compensation for named officers includes salary, bonuses, and stock awards, with Michael Crawford's 2024 total compensation at **$1.79 million**, and director compensation including retainers and restricted stock units Summary Compensation Table (Years Ended December 31) | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | Total ($) | | :-------------------------------------------------------- | :--- | :--------- | :-------- | :--------------- | :----------------------------------------- | :------------------------- | :----------- | | Michael Crawford, President, Chief Executive Officer and Chairman | 2024 | 976,153 | 720,000 | - | - | 94,159 | 1,790,312 | | | 2023 | 900,000 | 982,244 | 855,843 | 180,037 | 54,916 | 2,973,040 | | Tara Charnes, General Counsel and Secretary | 2024 | 251,790 | 160,000 | - | - | 10,966 | 422,756 | | | 2023 | 309,000 | 125,006 | 113,940 | 36,966 | 8,804 | 593,716 | | Anne Graffice, Executive Vice President of Global Marketing & Public Affairs | 2024 | 299,230 | 50,000 | - | - | 13,266 | 362,496 | | | 2023 | 285,401 | 122,909 | 56,963 | 10,584 | 13,435 | 489,292 | | Lisa Gould, Senior Vice President of Human Resources & Information Technology | 2024 | 190,000 | 65,600 | - | - | 13,383 | 268,983 | - Michael Crawford's **2023 PSU award**, eligible for **8,896 PSUs**, was waived by him, and he resigned as President, CEO, and Chairman effective **May 18, 2025**, entering a retention and consulting agreement for a **$300,000 bonus** and consulting fees[316](index=316&type=chunk)[317](index=317&type=chunk)[318](index=318&type=chunk) - Tara Charnes resigned as General Counsel and Corporate Secretary effective **August 31, 2024**, and subsequently entered a consulting services agreement[326](index=326&type=chunk) - The Company maintains a **401(k) plan** with matching contributions for employees, including named executive officers[332](index=332&type=chunk) Director Compensation (2024) | Name | Fees earned or paid in cash ($) | Stock Awards ($) | Total ($) | | :------------------ | :------------------------------ | :--------------- | :-------- | | Marcus LaMarr Allen | 50,500 | — | 50,500 | | Jerome Bettis | 48,000 | — | 48,000 | | Anthony J. Buzzelli | 67,500 | — | 67,500 | | David Dennis | 63,000 | — | 63,000 | | James J. Dolan | 41,625 | — | 41,625 | | Karl L. Holz | 68,125 | — | 68,125 | | Mary Owen | 63,375 | — | 63,375 | | Kimberly K. Schaefer| 69,375 | — | 69,375 | [Item 12. Security Ownership of Certain Beneficial Owners and Management And Related Stockholder Matters.](index=56&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20And%20Related%20Stockholder%20Matters.) Stuart Lichter and his affiliates collectively hold **72.3%** beneficial ownership of Common Stock, with all directors and executive officers owning **74.1%** as a group, and **342,805 shares** remaining available under equity compensation plans Beneficial Ownership of Common Stock (as of March 21, 2025) | Name and Address of Beneficial Owner | Number of Shares | Percentage | | :---------------------------------------------------- | :--------------- | :--------- | | Stuart Lichter | 13,593,978 | 72.3% | | All current directors and executive officers as a group (12 individuals) | 13,938,992 | 74.1% | | HOF Village, LLC | 840,168 | 12.3% | | CH Capital Lending, LLC | 11,856,828 | 66.6% | | IRG Canton Village Member, LLC | 840,168 | 12.3% | | IRG Canton Village Manager, LLC | 840,168 | 12.3% | | Industrial Realty Group, LLC | 459,534 | 6.4% | | Midwest Lender Fund, LLC | 405,294 | 5.7% | - The beneficial ownership percentages are based on approximately **6,698,645 shares** of Common Stock outstanding as of **March 21, 2025**[348](index=348&type=chunk) Equity Compensation Plan Information (as of December 31, 2024) | Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | :------------------------------------------------ | :-------------------------------------------------------------------------------- | :------------------------------------------------------------------------------ | :------------------------------------------------------------------------------------------------------------------------------------------ | | Equity compensation plans approved by security holders | 152,151 | $— | 253,057 | | Equity compensation plans not approved by security holders | 27,937 | $— | 89,748 | | Total | 180,088 | $— | 342,805 | - Mr. Lichter did not timely report four transactions attributable to various loan amendments and assignments under Section 16(a) of the Exchange Act, but all transactions were subsequently reported[360](index=360&type=chunk) [Item 13. Certain Relationships and Related Transactions and Director Independence.](index=60&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence.) The Company has a policy for reviewing related person transactions, including significant agreements with HOF Village, PFHOF, and various financial arrangements with IRG and its affiliates, controlled by director Stuart Lichter - The Company has a written related person transaction policy for reviewing and approving transactions exceeding **$120,000** involving directors, executive officers, **5% beneficial owners**, and their immediate family or affiliated entities[362](index=362&type=chunk)[363](index=363&type=chunk) - A Director Nominating Agreement grants HOF Village the right to designate **four directors** and PFHOF **one**, based on ownership thresholds[366](index=366&type=chunk) - The Amended and Restated Global License Agreement with PFHOF, effective **September 11, 2024**, licenses PFHOF marks for HOFV projects, removing the previous annual license fee requirement[370](index=370&type=chunk)[718](index=718&type=chunk) - IRG and its affiliates (controlled by director Stuart Lichter) provide master development and project management services, general corporate support, and are lenders for numerous significant loans, including various Term Loan, Bridge Loan, and Note & Security Agreements[376](index=376&type=chunk)[377](index=377&type=chunk)[378](index=378&type=chunk)[379](index=379&type=chunk)[382](index=382&type=chunk)[391](index=391&type=chunk)[396](index=396&type=chunk)[399](index=399&type=chunk)[403](index=403&type=chunk)[406](index=406&type=chunk)[407](index=407&type=chunk)[429](index=429&type=chunk)[433](index=433&type=chunk)[434](index=434&type=chunk) - Stuart Lichter personally guarantees the MKG DoubleTree Loan and indemnifies Hanover Insurance Company for the Constellation EME 3 Guarantee Bond[414](index=414&type=chunk)[419](index=419&type=chunk) - A non-binding proposal from IRG Canton Village Member, LLC to acquire all outstanding Common Stock not owned by Buyer and its affiliates is currently being evaluated by a Special Committee[428](index=428&type=chunk) [Item 14. Principal Accountant Fees and Services.](index=73&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services.) Grant Thornton LLP billed the Company **$507,703** in total fees for 2024, primarily for audit services, with the Audit Committee maintaining a pre-approval policy for all services Aggregate Fees Billed by Grant Thornton LLP | Fee Type | 2024 | 2023 | | :---------------- | :---------- | :---------- | | Audit Fees | $482,703 | $453,033 | | Audit-Related Fees| $25,000 | $42,500 | | Tax Fees | $- | $- | | All Other Fees | $- | $- | | Total | $507,703 | $495,533 | - The Audit Committee's charter requires pre-approval of all audit and permissible non-audit services provided by the independent registered public accounting firm[440](index=440&type=chunk) - The Chair of the Audit Committee has delegated authority to pre-approve permissible non-audit services, with reporting to the full committee at its next meeting[441](index=441&type=chunk) PART IV [Item 15. Exhibits and Financial Statement Schedules.](index=74&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules.) This section lists the financial statements and a comprehensive catalog of exhibits filed with the Annual Report on Form 10-K, including corporate governance documents and various material contracts - The consolidated financial statements for the fiscal years ended **December 31, 2024** and **2023** are included starting on page F-1[445](index=445&type=chunk) - A detailed list of exhibits is provided, covering corporate documents, warrant agreements, employment contracts, and numerous loan and security agreements, many of which involve related parties[446](index=446&type=chunk)[448](index=448&type=chunk)[450](index=450&type=chunk)[451](index=451&type=chunk)[452](index=452&type=chunk)[453](index=453&type=chunk)[454](index=454&type=chunk)[456](index=456&type=chunk)[457](index=457&type=chunk)[458](index=458&type=chunk)[459](index=459&type=chunk)[460](index=460&type=chunk)[461](index=461&type=chunk)[462](index=462&type=chunk) [Item 16. Form 10–K Summary.](index=87&type=section&id=Item%2016.%20Form%2010%E2%80%93K%20Summary.) This item is not applicable and contains no summary - Not applicable[464](index=464&type=chunk) SIGNATURES [SIGNATURES](index=88&type=section&id=SIGNATURES) The Annual Report on Form 10-K was signed on **March 26, 2025**, by Michael Crawford as President and Chief Executive Officer, John Van Buiten as Vice President of Accounting/Corporate Controller, and other directors - The report was signed on **March 26, 2025**, by Michael Crawford (President and CEO) and John Van Buiten (VP of Accounting/Corporate Controller), along with other directors[468](index=468&type=chunk)[469](index=469&type=chunk) Consolidated Financial Statements [Report of Independent Registered Public Accounting Firm](index=90&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Grant Thornton LLP issued an unqualified opinion on the Company's financial statements but highlighted a 'going concern' matter due to recurring losses, significant debt, and insufficient liquidity - Grant Thornton LLP issued an unqualified opinion on the consolidated financial statements for **2024** and **2023**[473](index=473&type=chunk) - The auditors noted a 'going concern' issue due to recurring losses, **$273.6 million accumulated deficit**, **$10.9 million cash used in operations** in **2024**, and **$109.5 million in debt** due by **December 31, 2025**, raising substantial doubt about the Company's ability to continue as a going concern[474](index=474&type=chunk)[501](index=501&type=chunk) [Consolidated Balance Sheets](index=91&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased from **$441.9 million** in 2023 to **$366.7 million** in 2024, while total liabilities decreased from **$315.2 million** to **$294.5 million**, and total equity attributable to HOFRE stockholders decreased to **$73.2 million** Consolidated Balance Sheet Highlights (as of December 31) | Metric | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Cash | $432,174 | $3,243,353 | | Restricted cash | $4,015,377 | $8,572,730 | | Total assets | $366,705,811 | $441,896,633 | | Notes payable, net | $245,747,816 | $219,532,941 | | Financing liability | $17,784,179 | $62,982,552 | | Total liabilities | $294,474,352 | $315,159,219 | | Accumulated deficit | $(273,561,929) | $(216,643,882) | | Total equity attributable to HOFRE stockholders | $73,194,885 | $127,692,252 | [Consolidated Statements of Operations](index=92&type=section&id=Consolidated%20Statements%20of%20Operations) The Company reported a net loss of **$55.9 million** in 2024, an improvement from **$68.8 million** in 2023, with total revenues decreasing by **12.1%** and operating expenses significantly decreasing by **30.9%** Consolidated Statements of Operations Highlights (Years Ended December 31) | Metric | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Total revenues | $21,205,933 | $24,129,673 | | Total operating expenses | $50,872,394 | $73,577,814 | | Loss from operations | $(29,666,461) | $(49,448,141) | | Interest expense, net | $(27,284,545) | $(18,763,838) | | Government grant | $9,763,126 | $- | | Change in fair value of warrant liability | $150,000 | $686,000 | | Loss on termination of financing liability| $(5,168,550) | $- | | Net loss | $(55,862,635) | $(68,753,804) | | Net loss attributable to HOFRE stockholders | $(56,918,047) | $(69,745,539) | | Net loss per share, basic and diluted | $(8.72) | $(11.97) | [Consolidated Statements of Changes in Stockholders' Equity](index=93&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Total equity decreased from **$126.7 million** at December 31, 2023, to **$72.2 million** at December 31, 2024, primarily due to the **$55.9 million** net loss, partially offset by stock-based compensation Changes in Stockholders' Equity (Years Ended December 31) | Metric | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Balance as of January 1 | $126,737,414 | $191,258,112 | | Stock-based compensation | $641,252 | $2,756,849 | | Sale of shares under ATM | $113,428 | $39,261 | | Preferred stock dividends | $(1,064,000) | $(1,064,000) | | Warrants issued for financing liability proceeds | $1,666,000 | $- | | Net loss | $(55,862,635) | $(68,753,804) | | Balance as of December 31 | $72,231,459 | $126,737,414 | [Consolidated Statements of Cash Flows](index=95&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net decrease in cash and restricted cash improved to **$7.4 million** in 2024, with cash used in operating activities decreasing significantly to **$10.9 million**, and financing activities providing **$11.3 million** Consolidated Statements of Cash Flows (Years Ended December 31) | Cash Flows From | 2024 | 2023 | | :-------------------------- | :-------------- | :-------------- | | Operating Activities | $(10,914,970) | $(27,000,438) | | Investing Activities | $(7,767,670) | $(27,826,165) | | Financing Activities | $11,314,108 | $33,126,304 | | Net decrease in cash and restricted cash | $(7,368,532) | $(21,700,299) | | Cash and restricted cash, end of year | $4,447,551 | $11,816,083 | - Cash used in operating activities decreased by **$16.1 million** in 2024, primarily due to a lower net loss and increased non-cash adjustments like depreciation and paid-in-kind interest[227](index=227&type=chunk) - Cash used in investing activities decreased by **$20.1 million**, driven by a **$29.2 million decrease** in capital spending on project development and **$8.4 million** received from the sale of the sports complex[228](index=228&type=chunk) - Cash provided by financing activities decreased by **$21.8 million**, mainly due to a **$19.1 million decrease** in proceeds from notes payable and an **$8.7 million increase** in repayments[229](index=229&type=chunk) [Notes to Consolidated Financial Statements](index=97&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the Company's organization, accounting policies, and financial position, including going concern uncertainty, waterpark lease termination impact, and subsequent events like Nasdaq delisting notice and CEO resignation [Note 1: Organization, Nature of Business, and Liquidity](index=97&type=section&id=Note%201%3A%20Organization%2C%20Nature%20of%20Business%2C%20and%20Liquidity) HOFRE, a resort and entertainment company, faces significant liquidity challenges with recurring losses and **$273.6 million** accumulated deficit, and the waterpark lease termination triggered **$81 million** in loan defaults, raising substantial doubt about its going concern ability - HOFRE is a resort and entertainment company focused on professional football, operating the Hall of Fame Village in Canton, Ohio, with diversified verticals including destination assets, media, and gaming[497](index=497&type=chunk) - The Company has sustained recurring losses, with an accumulated deficit of **$273.6 million** as of **December 31, 2024**, had **$0.4 million** in unrestricted cash and **$4.0 million** in restricted cash, and **$109.5 million in debt** due by **December 31, 2025**[501](index=501&type=chunk) - The termination of the waterpark ground lease on **October 26, 2024**, due to default, resulted in events of default under approximately **$81 million** of the Company's loan agreements[502](index=502&type=chunk) - These conditions raise substantial doubt about the Company's ability to continue as a going concern, requiring additional debt, construction lending, and equity financing[503](index=503&type=chunk) [Note 2: Summary of Significant Accounting Policies](index=99&type=section&id=Note%202%3A%20Summary%20of%20Significant%20Accounting%20Policies) This note details the Company's accounting policies, including U.S. GAAP consolidation, fair value measurement for warrant liabilities, capitalization of project development costs, impairment reviews, revenue recognition, and segment reporting as a single operating segment - The Company prepares consolidated financial statements in accordance with U.S. GAAP, consolidating wholly-owned subsidiaries and using the equity method for unconsolidated affiliates where it exerts significant influence[508](index=508&type=chunk)[510](index=510&type=chunk) - Warrants not indexed to the Company's own stock are classified as derivative liabilities and remeasured at fair value each period, with changes recognized in earnings[515](index=515&type=chunk) - All costs related to Hall of Fame Village development are capitalized during construction and cease upon substantial completion or suspension of activities[519](index=519&type=chunk) - Long-lived assets are reviewed for impairment when indicators are present and undiscounted cash flows are less than carrying value, with a **$7.7 million impairment loss** recorded in **2023** for the ForeverLawn Sports Complex[521](index=521&type=chunk)[522](index=522&type=chunk) - Revenue is recognized under ASC 606 across sponsorship agreements, rents, food & beverage, events, and hotel/restaurant operations, based on satisfying performance obligations[541](index=541&type=chunk)[542](index=542&type=chunk) - The Company is managed as a single operating segment, with financial information and plans reviewed at the consolidated level by the President, CEO, & Chairman[561](index=561&type=chunk)[562](index=562&type=chunk) Potentially Dilutive Securities Excluded from EPS (as of December 31) | Security Type | 2024 | 2023 | | :------------------------------------------------ | :----------- | :----------- | | Warrants to purchase shares of Common Stock | 3,681,403 | 2,793,649 | | Unvested restricted stock units | 205,754 | 163,922 | | Shares of Common Stock issuable upon conversion of convertible notes | 11,001,511 | 9,668,009 | | Shares of Common Stock issuable upon conversion of Series C Preferred Stock | 454,408 | 454,408 | | Total potentially dilutive securities | 15,343,076 | 13,082,959 | [Note 3: Property and Equipment](index=108&type=section&id=Note%203%3A%20Property%20and%20Equipment) Property and equipment, net, decreased to **$334.7 million** in 2024, with project development costs significantly reduced, and the Company recorded **$17.0 million** in depreciation expense Property and Equipment, Net (as of December 31) | Category | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Property and equipment, net, including property and equipment held for sale | $334,709,643 | $356,704,062 | | Project development costs | $10,404,499 | $59,366,200 | Depreciation and Capitalized Project Development Costs (Years Ended December 31) | Metric | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Depreciation expense | $17,007,248 | $15,069,782 | | Capitalized project development costs | $16,395,806 | $47,985,893 | - On **January 11, 2024**, the Company sold an **80% interest** in its ForeverLawn Sports Complex, with **$12,325,227** of related assets classified as 'held for sale' as of **December 31, 2023**[591](index=591&type=chunk) [Note 4: Notes Payable, net](index=109&type=section&id=Note%204%3A%20Notes%20Payable%2C%20net) Notes payable, net, increased to **$245.7 million** in 2024, with **$109.5 million** in principal payments due in 2025, following numerous loan amendments extending maturities and modifying terms Notes Payable, Net (as of December 31) | Metric | 2024 | 2023 | | :---------------------------------------- | :-------------- | :-------------- | | Total Gross Principal Payments | $251,364,649 | $229,185,010 | | Less: Debt discount and deferred financing costs | $(5,616,833) | $(9,652,069) | | Total Net Principal Payments | $245,747,816 | $219,532,941 | Future Minimum Principal Payments on Notes Payable (as of December 31, 2024) | Year Ending December 31 | Amount | | :---------------------- | :-------------- | | 2025 | $109,533,630 | | 2026 | $5,904,740 | | 2027 | $7,757,437 | | 2028 | $14,596,832 | | 2029 | $3,818,096 | | Thereafter | $109,753,914 | | Total Gross Principal Payments | $251,364,649 | - Multiple loan agreements were amended in **2024**, including those with the City of Canton, New Market/SCF, CH Capital, IRG, and Stark County, generally extending maturity dates and modifying repayment terms[608](index=608&type=chunk)[611](index=611&type=chunk)[616](index=616&type=chunk)[617](index=617&type=chunk)[618](index=618&type=chunk)[619](index=619&type=chunk)[627](index=627&type=chunk)[636](index=636&type=chunk)[639](index=639&type=chunk)[644](index=644&type=chunk) - The Company secured a new **$1.5 million SCF Loan** and approximately **$9.9 million** from Constellation's Energy Made Easy program in **2024**[647](index=647&type=chunk)[649](index=649&type=chunk) Accrued Interest on Notes Payable (as of December 31) | Metric | 2024 | 2023 | | :----- | :------------ | :------------ | | Total | $1,029,112 | $804,713 | [Note 5: Stockholders' Equity](index=118&type=section&id=Note%205%3A%20Stockholders%27%20Equity) The Company's equity compensation plans have **172,448 shares** remaining available, the ATM offering expired in September 2024, and **215,978 RSUs** were granted in 2024, with **3,681,403 warrants** outstanding at year-end - As of **December 31, 2024**, **111,092 shares** remained available under the 2020 Omnibus Incentive Plan, and **61,356 shares** under the 2023 Inducement Plan[654](index=654&type=chunk)[656](index=656&type=chunk) - The Equity Distribution Agreement for an at-the-market offering expired on **September 14, 2024**, after the Company received net proceeds of **$113,428** in **2024**[662](index=662&type=chunk) Restricted Stock Units (RSUs) Activity (Year Ended December 31, 2024) | Metric | Number of shares | | :-------------------------- | :--------------- | | Non–vested at January 1, 2024 | 126,350 | | Granted | 215,978 | | Vested | (83,001) | | Forfeited | (56,281) | | Non–vested at December 31, 2024 | 203,046 | - Stock-based compensation expense for RSUs was **$711,101** in **2024**, while PSUs granted in **2023** were forfeited in **2024**, leading to an **$85,299 reversal** of previously recognized compensation[669](index=669&type=chunk)[674](index=674&type=chunk) Warrant Activity (Year Ended December 31, 2024) | Metric | Number of Shares | | :-------------------------- | :--------------- | | Outstanding - January 1, 2024 | 2,793,649 | | Granted | 890,313 | | Expired | (2,559) | | Outstanding – December 31, 2024 | 3,681,403 | [Note 6: Sponsorship Revenue and Associated Commitments](index=122&type=section&id=Note%206%3A%20Sponsorship%20Revenue%20and%20Associated%20Commitments) Net sponsorship revenue was **$2.86 million** in 2024, a slight increase from 2023, with **$8.2 million** in future cash expected from these agreements - Sponsorship revenue is generated from agreements offering strategic opportunities for brand recognition and other benefits[684](index=684&type=chunk) Net Sponsorship Revenue (Years Ended December 31) | Year | Amount | | :--- | :---------- | | 2024 | $2,860,451 | | 2023 | $2,819,041 | Scheduled Future Cash from Sponsorship Agreements (as of December 31, 2024) | Year Ending December 31 | Amount | | :---------------------- | :---------- | | 2025 | $2,107,015 | | Total | $8,195,524 | [Note 7: Other Commitments](index=122&type=section&id=Note%207%3A%20Other%20Commitments) The Company has management agreements for its DoubleTree Hotel and the rebranded 'Gridiron Gastropub', sports betting agreements with Betr, and received **$10.3 million** in government grants in 2024 - The management agreement with Crestline Hotels & Resorts for the DoubleTree Canton Downtown Hotel is set to terminate on **November 21, 2025**[687](index=687&type=chunk) - The management agreement with Shula's Steak Houses was terminated on **August 18, 2024**, and the restaurant was rebranded as 'Gridiron Gastropub'[691](index=691&type=chunk) - The Company has an Online Market Access Agreement with Betr for online sports betting in Ohio, which includes a limited equity interest in Betr and revenue sharing[693](index=693&type=chunk)[694](index=694&type=chunk) - The deadline for the Company to accept at least one retail sports bet under its Type B license in Ohio has been extended to **December 31, 2027**[696](index=696&type=chunk) Other Liabilities (as of December 31) | Category | 2024 | 2023 | | :------------------------ | :---------- | :---------- | | Activation fund reserves | $121,748 | $126,685 | | Deferred revenue | $5,208,904 | $5,441,640 | | Deposits and other liabilities | $325,758 | $290,357 | | Total | $5,656,410 | $5,858,682 | - The Company received a **$0.5 million Community Assistance Grant** and a **$9.8 million State of Ohio Grant** in **2024**, both recorded as 'Other income'[702](index=702&type=chunk)[704](index=704&type=chunk) [Note 8: Contingencies](index=124&type=section&id=Note%208%3A%20Contingencies) The Company is subject to occasional legal proceedings but has no pending litigation that would materially adversely affect its financial results - The Company does not have any pending litigation that would materially adversely affect its results of operations, financial condition, or cash flows[707](index=707&type=chunk) [Note 9: Related-Party Transactions](index=125&type=section&id=Note%209%3A%20Related-Party%20Transactions) Related-party transactions include **$2.6 million** in advances from IRG Member, an amended Global License Agreement with PFHOF, a lease with Touchdown Work Place, and a non-binding take-private proposal from IRG Canton Village Member Due to Affiliates (as of December 31) | Affiliate | 2024 | 2023 | | :--------------- | :------------ | :------------ | | Due to IRG Member| $2,646,169 | $1,127,390 | | Due to PFHOF | $264,658 | $166,484 | | Total | $2,910,827 | $1,293,874 | - The Amended and Restated Global License Agreement with PFHOF, effective **September 11, 2024**, removed the requirement for an annual license fee[717](index=717&type=chunk)[718](index=718&type=chunk) - A ten-year lease agreement was entered with Touchdown Work Place, LLC (managed by director Stuart Lichter) for commercial office space in the Constellation Center for Excellence[722](index=722&type=chunk) - A non-binding proposal from IRG Canton Village Member to acquire outstanding Common Stock not owned by Buyer and its affiliates is under evaluation by a Special Committee[724](index=724&type=chunk) - Stuart Lichter and his family trusts executed a General Indemnity Agreement in favor of Hanover Insurance Company, guaranteeing the Company's obligations under a guarantee bond for waterpark financing[731](index=731&type=chunk) [Note 10: Concentrations](index=128&type=section&id=Note%2010%3A%20Concentrations) In 2024, two customers accounted for **41.1%** and **12.8%** of sponsorship revenue and **17.8%** and **13.8%** of accounts receivable, with cash balances concentrated in third-party financial institutions - In **2024**, two customers accounted for approximately **41.1%** and **12.8%** of sponsorship revenue[732](index=732&type=chunk) - As of **December 31, 2024**, two customers represented approximately **17.8%** and **13.8%** of accounts receivable[733](index=733&type=chunk) - Cash and restricted cash balances, which may exceed federally insured limits, are concentrated in third-party financial institutions, exposing the Company to risk if these institutions fail[734](index=734&type=chunk) [Note 11: Leases](index=129&type=section&id=Note%2011%3A%20Leases) The Company acts as both lessee and lessor, with operating lease ROU assets of **$7.1 million** and liabilities of **$3.3 million**, and generated **$1.7 million** in lease revenue as a lessor in 2024 Lease Information (as of December 31) | Category | 2024 | 2023 | | :---------------- | :-------------- | :-------------- | | Operating leases: Right-of-use assets | $7,144,366 | $7,387,693 | | Operating leases: Lease liability | $3,333,443 | $3,440,630 | | Financing leases: Right-of-use assets | $77,390 | $- | | Financing leases: Lease liability | $68,156 | $- | - The weighted-average remaining lease term for operating leases is **89.7 years**, with a weighted-average discount rate of **10.0%**[742](index=742&type=chunk) Future Minimum Lease Payments (Operating Leases, Undiscounted, as of December 31, 2024) | Year Ending December 31 | Amount | | :---------------------- | :-------------- | | 2025 | $301,400 | | Thereafter | $38,786,800 | | Total | $40,348,200 | - As a lessor, the Company's leased properties generated **$1,696,675** in lease revenue in **2024**, with future minimum lease revenue totaling **$9.9 million**[749](index=749&type=chunk) [Note 12: Financing Liability](index=132&type=section&id=Note%2012%3A%20Financing%20Liability) The waterpark ground lease was terminated on **October 26, 2024**, due to a **$2.6 million** payment default, resulting in a **$5.2 million** loss and triggering defaults on **$81 million** of other loan agreements, with financing liability decreasing to **$17.8 million** - Sale-leaseback transactions for the Fan Engagement Zone and the waterpark were accounted for as financing arrangements, not true sales, due to the nature of the lease agreements[754](index=754&type=chunk) - The waterpark ground lease was terminated on **October 26, 2024**, due to a payment default of approximately **$2.6 million**, resulting in a **$5,168,550 loss** on termination of financing liability[759](index=759&type=chunk)[760](index=760&type=chunk)[766](index=766&type=chunk) - The termination of the waterpark ground lease triggered events of default under approximately **$81 million** of the Company's loan agreements[765](index=765&type=chunk) Financing Liability Carrying Value (as of December 31) | Year | Amount | | :--- | :-------------- | | 2024 | $17,784,179 | | 2023 | $62,982,552 | Remaining Future Cash Payments for Financing Liability (Undiscounted, as of December 31, 2024) | Year Ending December 31 | Amount | | :---------------------- | :-------------- | | 2025 | $1,259,335 | | Thereafter | $356,101,022 | | Total | $362,654,653 | [Note 13: Disposition](index=135&type=section&id=Note%2013%3A%20Disposition) On **January 11, 2024**, the Company sold an **80% interest** in its ForeverLawn Sports Complex for **$10 million**, resulting in a **$140,041 loss** on sale, with the remaining **20%** accounted for as an equity-method investment - On **January 11, 2024**, the Company sold an **80% interest** in its ForeverLawn Sports Complex to Sandlot Facilities, LLC for a **$10 million purchase price**[771](index=771&type=chunk) Loss on Sale of Sports Complex | Metric | Amount | | :---------------------- | :-------------- | | Purchase price | $10,000,000 | | Net purchase price | $9,785,778 | | Less: transaction costs | $(159,144) | | Less: book value of net assets sold | $(12,213,120) | | Plus: investment retained | $2,446,445 | | Loss on sale | $(140,041) | - The Company accounts for its retained **20% interest** in the sports complex as an equity-method investment[772](index=772&type=chunk) [Note 14: Income Taxes](index=136&type=section&id=Note%2014%3A%20Income%20Taxes) As of December 31, 2024, total deferred tax assets of **$67.5 million** were fully offset by a valuation allowance, resulting in a **0% effective tax rate** due to significant net operating loss carry-forwards Net Deferred Tax Assets (Liabilities) (as of December 31) | Metric | 2024 | 2023 | | :------------------------ | :-------------- | :-------------- | | Total deferred tax assets | $67,463,602 | $53,072,102 | | Total deferred tax liabilities | $(3,223,633) | $(1,623,765) | | Total net deferred tax assets | $64,239,969 | $51,448,337 | | Less: valuation allowance | $(64,239,969) | $(51,448,337) | | Net deferred tax asset | $— | $— | Tax Attributes (as of December 31, 2024) | Attribute | Amount | Begins to expire | | :-------------------------------------- | :-------------- | :--------------- | | U.S. federal net operating loss carry–forwards | $279,521,326 | Indefinite | | U.S. local net operating loss carry–forwards | $279,963,638 | 2026 | - A full valuation allowance has been recognized for deferred tax assets, as it is not more likely than not that the benefits will be realized, resulting in a **0% effective tax rate** for both **2024** and **2023**[777](index=777&type=chunk)[778](index=778&type=chunk) [Note 15: Employee Benefit Plans](index=137&type=section&id=Note%2015%3A%20Employee%20Benefit%20Plans) The Company maintains a tax-qualified defined contribution **401(k) plan** for employees, with employer matching contributions of **$146,595** in 2024 - The Company maintains a tax-qualified defined contribution **401(k) plan**[779](index=779&type=chunk) Employer Matching Contributions (Years Ended December 31) | Year | Amount | | :--- | :---------- | | 2024 | $146,595 | | 2023 | $191,073 | [Note 16: Subsequent Events](index=138&type=section&id=Note%2016%3A%20Subsequent%20Events) Subsequent events include a Nasdaq deficiency letter for failing to hold an annual meeting, further amendments to the CHCL loan agreement, and Michael Crawford's resignation as President, CEO, and Chairman - On **January 10, 2025**, the Company received a Nasdaq deficiency letter for failing to hold an annual meeting by **December 31, 2023**, and was granted an extension until **June 30, 2025**, to regain compliance[782](index=782&type=chunk)[784](index=784&type=chunk) - The Note and Security Agreement with CHCL was amended multiple times in **January-March 2025**, increasing the 'Facility Amount' from **$2.0 million to $6.5 million** for general corporate purposes[786](index=786&type=chunk)[790](index=790&type=chunk)[791](index=791&type=chunk) - Michael Crawford resigned as President, CEO, and Chairman on **March 12, 2025**, effective **May 18, 2025**, to pursue another career opportunity, entering a Retention and Consulting Agreement for a **$300,000 retention bonus** and consulting services[792](index=792&type=chunk)[793](index=793&type=chunk)[794](index=794&type=chunk)

PART I. FINANCIAL INFORMATION This section presents the company's financial statements, notes, and management's analysis of financial condition [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements and detailed notes for Q3 2024 and 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased and liabilities increased from December 31, 2023, to September 30, 2024, reducing equity Balance Sheet Summary | Metric | September 30, 2024 (unaudited) | December 31, 2023 | | :---------------------- | :----------------------------- | :---------------- | | Total Assets | $435,640,564 | $441,896,633 | | Total Liabilities | $341,938,767 | $315,159,219 | | Total Equity | $93,701,797 | $126,737,414 | - Cash and restricted cash **decreased from $11,816,083** at December 31, 2023, to **$7,484,428** at September 30, 2024[7](index=7&type=chunk)[16](index=16&type=chunk) - Notes payable, net, **increased from $219,532,941** at December 31, 2023, to **$241,587,376** at September 30, 2024[7](index=7&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net loss significantly reduced for Q3 and nine months ended September 30, 2024, due to lower expenses and grants Statements of Operations Summary (3 Months Ended Sep 30) | Metric (3 Months Ended Sep 30) | 2024 | 2023 | | :----------------------------- | :------------ | :------------- | | Total Revenues | $7,501,626 | $8,744,829 | | Total Operating Expenses | $14,653,110 | $18,783,342 | | Loss from Operations | $(7,151,484) | $(10,038,513) | | Total Other Income (Expense) | $2,731,154 | $(6,125,839) | | Net Loss | $(4,420,330) | $(16,164,352) | | Net Loss per Share (Basic/Diluted) | $(0.72) | $(2.89) | Statements of Operations Summary (9 Months Ended Sep 30) | Metric (9 Months Ended Sep 30) | 2024 | 2023 | | :----------------------------- | :------------- | :------------- | | Total Revenues | $16,392,610 | $17,992,539 | | Total Operating Expenses | $39,026,004 | $52,124,170 | | Loss from Operations | $(22,633,394) | $(34,131,631) | | Total Other Income (Expense) | $(11,906,094) | $(14,718,507) | | Net Loss | $(34,539,488) | $(48,850,138) | | Net Loss per Share (Basic/Diluted) | $(5.42) | $(8.77) | - Other income significantly **increased to $9,763,126** for the three months and **$10,263,126** for the nine months ended September 30, 2024, primarily due to government grants[9](index=9&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk) [Condensed Consolidated Statement of Changes in Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders%27%20Equity) Stockholders' equity decreased from $126.7 million to $93.7 million due to net loss, partially offset by compensation and warrants Stockholders' Equity Summary | Metric | January 1, 2024 | September 30, 2024 | | :----------------------------------- | :-------------- | :----------------- | | Total Stockholders' Equity | $126,737,414 | $93,701,797 | | Net Loss | - | $(34,539,488) | | Stock-based Compensation | - | $522,443 | | Warrants issued for financing liability proceeds | - | $1,666,000 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash used in operating and investing activities decreased, while financing activities declined, leading to a net decrease in cash Cash Flow Summary (9 Months Ended Sep 30) | Cash Flow Activity (9 Months Ended Sep 30) | 2024 | 2023 | | :----------------------------------------- | :-------------- | :-------------- | | Net cash used in operating activities | $(7,126,021) | $(19,606,299) | | Net cash used in investing activities | $(8,682,184) | $(20,069,154) | | Net cash provided by financing activities | $11,476,550 | $17,918,352 | | Net decrease in cash and restricted cash | $(4,331,655) | $(21,757,101) | | Cash and restricted cash, end of period | $7,484,428 | $11,759,281 | - The decrease in cash used in operating activities was primarily due to a **$14.3 million decrease in net loss** and a **$4.7 million increase in paid-in-kind interest**[272](index=272&type=chunk) - Investing activities saw a **$20.5 million decrease in capital spending** on project development, partially offset by an **$8.4 million increase from asset sales**[273](index=273&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the company's organization, accounting policies, debt, equity, revenue, related-party transactions, and subsequent events [Note 1: Organization, Nature of Business, and Liquidity](index=11&type=section&id=Note%201%3A%20Organization%2C%20Nature%20of%20Business%2C%20and%20Liquidity) HOFRE faces significant liquidity challenges, including recurring losses and substantial debt maturities, raising going concern doubts - HOFRE operates the Hall of Fame Village and a DoubleTree by Hilton hotel, leveraging professional football[21](index=21&type=chunk) - The company has an **accumulated deficit of $252.0 million** as of September 30, 2024, and sustained recurring losses[23](index=23&type=chunk) - As of September 30, 2024, unrestricted cash was **$2.6 million** and restricted cash was **$4.9 million**; **$7.1 million** was used in operating activities[23](index=23&type=chunk) - Approximately **$97.1 million of debt** is due through November 13, 2025, including **$11.2 million due by December 4, 2024**[23](index=23&type=chunk) - The company is in default or risks default on approximately **$81 million of gross principal outstanding loan agreements** due to the waterpark ground lease termination[25](index=25&type=chunk) - Management believes these conditions raise substantial doubt about the company's ability to continue as a going concern[26](index=26&type=chunk) [Note 2: Summary of Significant Accounting Policies](index=12&type=section&id=Note%202%3A%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the company's accounting principles, including basis of presentation, consolidation, estimates, and specific policies - Warrants not indexed to the company's own stock are accounted for as liabilities at fair value and remeasured each balance sheet date[31](index=31&type=chunk) - Restricted cash includes escrow reserve accounts for capital improvements and debt service, totaling **$4,915,073** as of September 30, 2024[33](index=33&type=chunk) - Revenue is recognized when a customer obtains control of promised goods or services, applying a five-step model[41](index=41&type=chunk) - The company uses an asset and liability approach for income taxes, establishing a valuation allowance when deferred tax assets are unlikely to be realized[47](index=47&type=chunk)[48](index=48&type=chunk) Warrant Liability Summary | Warrant Liability Type | September 30, 2024 | December 31, 2023 | | :-------------------------- | :----------------- | :---------------- | | Public Series A Warrants | $161,000 | $204,000 | | Private Series A Warrants | - | - | | Series B Warrants | - | $21,000 | | Total Warrant Liability | $161,000 | $225,000 | - The company has excluded **14,970,656 potentially dilutive securities** from net loss per share calculation as of September 30, 2024, due to its loss position[68](index=68&type=chunk)[69](index=69&type=chunk) [Note 3: Property and

Core Insights - Hall of Fame Village Media has partnered with ReachTV to launch "Hometown Heroes," a new sports entertainment program that provides viewers with an inside look at the lives of high-level athletes [1][2][4] Company Overview - Hall of Fame Resort & Entertainment Company operates in three main divisions: media, gaming, and destination, focusing on creating legendary experiences for fans and families [6] - Hall of Fame Village Media is a multi-dimensional content studio that produces original content across various genres and mediums, leveraging its unique access to sports legends [7] Program Details - "Hometown Heroes" features short videos showcasing athletes revisiting significant locations in their hometowns that contributed to their careers, offering fans behind-the-scenes access [3] - The first episode of "Hometown Heroes," featuring Doug Williams, is available on ReachTV's platform and its distribution network [5] ReachTV Overview - ReachTV is a free ad-supported streaming television network with over 40 million monthly viewers, distributed in 500,000 hotels and more than 2,500 airport screens across North America [8] - The network offers a diverse programming lineup, including original content and live sports, enhancing the viewing experience for travelers [2][8]

Core Insights - Hall of Fame Resort & Entertainment Company has secured $9.9 million in funding from Constellation to enhance energy efficiency and support the construction of Gameday Bay Waterpark as part of its Phase II development plan [1][2][4] - Constellation, the largest producer of carbon-free energy in the U.S., is providing financing through its Efficiency Made Easy® program, which aims to reduce energy consumption and promote sustainability within the resort [2][4] - The Hall of Fame Resort & Entertainment Company is focused on leveraging the popularity of professional football and its partnership with the Pro Football Hall of Fame to create a multi-use sports and entertainment destination [3] Funding and Development - The $9.9 million financing will enable the installation of energy-efficient technology and systems at Hall of Fame Village [2] - This funding is part of a broader strategy to prioritize energy efficiency and sustainability in the company's construction and operational goals [4] Company Overview - Hall of Fame Resort & Entertainment Company is headquartered in Canton, Ohio, and operates the Hall of Fame Village, which is centered around the Pro Football Hall of Fame [3] - The company aims to create a unique destination that combines sports, entertainment, and media, capitalizing on the legacy of professional football [3]

"We continue to be grateful for the tremendous leadership of Senate President Pro Tempore Kirk Schuring, Representative Scott Oeslager as well as Senate President Matt Huffman, and the many other civic leaders within the State of Ohio for their continued support of our Hall of Fame Village project," shared Hall of Fame Resort & Entertainment President and CEO Michael Crawford. "The award of this grant speaks to the state's belief in the social and economic impact we are already having in our community and t ...

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, equity changes, and cash flows, with detailed notes on organization, policies, debt, equity, and commitments [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets and equity slightly decreased, while total liabilities increased, reflecting reduced cash and restricted cash, higher project development costs, and increased notes payable | Metric | March 31, 2024 | December 31, 2023 | | :-------------------------------- | :------------- | :---------------- | | Total assets | $439,570,798 | $441,896,633 | | Total liabilities | $325,967,091 | $315,159,219 | | Total equity | $113,603,707 | $126,737,414 | | Cash | $2,713,210 | $3,243,353 | | Restricted cash | $4,170,957 | $8,572,730 | | Project development costs | $69,932,439 | $59,366,200 | | Notes payable, net | $221,653,857 | $219,532,941 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net loss improved to $14.6 million in Q1 2024 from $19.4 million in Q1 2023, driven by increased revenues and decreased operating expenses, despite higher interest expense | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Total revenues | $4,191,315 | $3,120,433 | | Total operating expenses | $11,283,546 | $17,686,279 | | Loss from operations | $(7,092,231) | $(14,565,846) | | Interest expense, net | $(6,521,534) | $(3,632,637) | | Net loss | $(14,630,176) | $(19,392,374) | | Net loss attributable to HOFRE stockholders | $(14,887,588) | $(19,609,797) | | Net loss per share, basic and diluted | $(2.30) | $(3.48) | - Total revenues increased by **34.3%** (**$4,191,315** in 2024 vs. **$3,120,433** in 2023) for the three months ended March 31[10](index=10&type=chunk) - Net loss improved by **24.6%** (**$14,630,176** in 2024 vs. **$19,392,374** in 2023) for the three months ended March 31[10](index=10&type=chunk) [Condensed Consolidated Statement of Changes in Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) Total stockholders' equity decreased from $126.7 million to $113.6 million, primarily due to net loss, partially offset by additional paid-in capital from warrants | Metric | As of January 1, 2024 | As of March 31, 2024 | | :------------------------------------ | :-------------------- | :------------------- | | Total Equity | $126,737,414 | $113,603,707 | | Additional Paid-In Capital | $344,335,489 | $346,097,951 | | Accumulated Deficit | $(216,643,882) | $(231,531,470) | | Net Loss | $(14,621,588) | $(14,621,588) | - Total equity decreased by approximately **$13.1 million** from January 1, 2024, to March 31, 2024[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash and restricted cash decreased by $4.9 million, with significantly less cash used in operating and investing activities, while financing activities provided less cash | Cash Flow Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(2,476,875) | $(11,542,932) | | Net cash used in investing activities | $(2,967,807) | $(24,679,007) | | Net cash provided by financing activities | $512,766 | $17,406,477 | | Net decrease in cash and restricted cash | $(4,931,916) | $(18,815,462) | | Cash and restricted cash, end of period | $6,884,167 | $14,700,920 | - Net cash used in operating activities decreased by **$9.1 million** (from **$11.5 million** in 2023 to **$2.5 million** in 2024)[14](index=14&type=chunk)[301](index=301&type=chunk) - Net cash used in investing activities decreased by **$21.7 million** (from **$24.7 million** in 2023 to **$3.0 million** in 2024), primarily due to proceeds from asset sales[14](index=14&type=chunk)[303](index=303&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures on financial position, operations, and cash flows, covering accounting policies, debt, equity, commitments, related-party transactions, and subsequent events [Note 1: Organization, Nature of Business, and Liquidity](index=10&type=section&id=Note%201%3A%20Organization%2C%20Nature%20of%20Business%2C%20and%20Liquidity) The company, a resort and entertainment entity, faces significant liquidity challenges, recurring losses, and substantial debt maturities, raising going concern doubts without additional financing - The Company's accumulated deficit was **$231.5 million** as of March 31, 2024[27](index=27&type=chunk) | Metric | As of March 31, 2024 | | :-------------------- | :------------------- | | Unrestricted cash | $2.7 million | | Restricted cash | $4.2 million | | Debt due through May 14, 2025 | $90.6 million | - The Company used **$2.5 million** cash for operating activities during the three months ended March 31, 2024[27](index=27&type=chunk) - Management believes these conditions raise substantial doubt about the Company's ability to continue as a going concern[28](index=28&type=chunk) [Note 2: Summary of Significant Accounting Policies](index=12&type=section&id=Note%202%3A%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines key accounting policies for revenue recognition, fair value measurement, and net loss per share, detailing warrant accounting, revenue streams, estimates, and financial instrument hierarchy - The Company accounts for warrants not indexed to its own stock as liabilities at fair value, subject to remeasurement each balance sheet date[41](index=41&type=chunk) - Restricted cash balances were **$4,170,957** as of March 31, 2024, and **$8,572,730** as of December 31, 2023, held for capital improvements and debt service[44](index=44&type=chunk) - Revenue is recognized when a customer obtains control of promised goods or services, following a five-step model, with specific recognition criteria for sponsorships, events, rentals, hotel, restaurant, media content, and gaming license revenues[60](index=60&type=chunk)[61](index=61&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) Fair Value of Warrant Liabilities | Warrant Type | Level | March 31, 2024 | December 31, 2023 | | :----------------------------- | :---- | :------------- | :---------------- | | Public Series A Warrants | 1 | $159,000 | $204,000 | | Private Series A Warrants | 3 | - | - | | Series B Warrants | 3 | $17,000 | $21,000 | | **Total Warrant Liabilities** | | **$176,000** | **$225,000** | - The change in fair value of warrant liability resulted in a **$49,000** gain for the three months ended March 31, 2024, compared to a **$238,000** loss in the prior year[10](index=10&type=chunk)[89](index=89&type=chunk) [Note 3: Property and Equipment](index=20&type=section&id=Note%203%3A%20Property%20and%20Equipment) Net property and equipment decreased to $341.6 million due to the sale of an 80% interest in the Sports Complex, while project development costs and depreciation expense increased | Metric | March 31, 2024 | December 31, 2023 | | :------------------------------------------------- | :------------- | :---------------- | | Property and equipment, net, including held for sale | $341,626,103 | $356,704,062 | | Project development costs | $69,932,439 | $59,366,200 | | Property and equipment held for sale | - | $12,325,227 | - Depreciation expense increased by **62.9%** to **$4,158,750** for the three months ended March 31, 2024, from **$2,553,360** in the prior year[101](index=101&type=chunk) - The Company sold an **80%** interest in its ForeverLawn Sports Complex on January 11, 2024, which was classified as 'held for sale' at December 31, 2023[100](index=100&type=chunk) [Note 4: Notes Payable, net](index=21&type=section&id=Note%204%3A%20Notes%20Payable%2C%20net) Net notes payable increased to $221.7 million, detailing loan amendments, IRG-affiliated loan extensions, and significant future principal payments, with $90.6 million due through May 2025 Notes Payable, Net | Metric | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Total Gross | $230,362,032 | $229,185,010 | | Debt discount and deferred financing costs | $(8,708,175) | $(9,652,069) | | **Total Net** | **$221,653,857** | **$219,532,941** | - Amortization of note discounts and deferred financing costs increased to **$955,322** for the three months ended March 31, 2024, from **$855,891** in the prior year[106](index=106&type=chunk) - The Company entered into multiple amendments with CH Capital Lending, LLC in Q1 2024, increasing the principal amount of the loan[116](index=116&type=chunk)[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) - An omnibus extension on April 7, 2024, modified the maturity date for several IRG Debt Instruments from March 31, 2024, to March 31, 2025, with a **1%** extension fee[121](index=121&type=chunk)[123](index=123&type=chunk) Future Minimum Principal Payments on Notes Payable | Year Ending December 31, | Amount | | :------------------------- | :------------- | | 2024 (nine months) | $4,275,952 | | 2025 | $86,355,474 | | 2026 | $4,058,147 | | 2027 | $17,637,809 | | 2028 | $13,730,685 | | Thereafter | $104,303,965 | | **Total Gross Principal Payments** | **$230,362,032** | [Note 5: Stockholders' Equity](index=27&type=section&id=Note%205%3A%20Stockholders'%20Equity) This note details changes in stockholders' equity, including equity awards, at-the-market offerings, RSU and PSU activity, warrant modifications, and Series A Preferred Stock issuance - As of March 31, 2024, **101,006** shares remained available for issuance under the 2020 Omnibus Incentive Plan, and **76,674** shares under the 2023 Inducement Plan[133](index=133&type=chunk)[135](index=135&type=chunk) - The Equity Distribution Agreement was amended on April 8, 2024, increasing agent compensation from **2.0%** to **4.0%** of gross offering proceeds[140](index=140&type=chunk) Restricted Stock Units (RSUs) Activity | Metric | Number of shares | Weighted average grant date fair value | | :-------------------------- | :--------------- | :----------------------------------- | | Non–vested at January 1, 2024 | 126,350 | $17.54 | | Granted | 181,781 | $3.21 | | Vested | (73,089) | $20.94 | | Forfeited | (24,842) | $10.98 | | **Non–vested at March 31, 2024** | **210,200** | **$4.73** | - For the three months ended March 31, 2024, the Company recorded **$181,768** in stock-based compensation expense related to RSUs, a decrease from **$600,377** in the prior year[145](index=145&type=chunk) - All Performance Stock Units (**88,965** shares) were forfeited in January 2024 as performance criteria were not met, resulting in a reversal of **$85,299** in stock-based compensation expense[150](index=150&type=chunk) [Note 6: Sponsorship Revenue and Associated Commitments](index=31&type=section&id=Note%206%3A%20Sponsorship%20Revenue%20and%20Associated%20Commitments) Sponsorship revenue increased by 27.7% to $859,731 in Q1 2024 due to new sponsorships, with future cash commitments totaling $8.9 million Sponsorship Revenue | Period | Amount | | :-------------------------------- | :----------- | | Three months ended March 31, 2024 | $859,731 | | Three months ended March 31, 2023 | $673,475 | | **Increase** | **$186,256 (27.7%)** | Scheduled Future Cash from Sponsorship Agreements | Year ending December 31, | Amount | | :------------------------- | :----------- | | 2024 (nine months) | $1,094,025 | | 2025 | $2,101,327 | | 2026 | $1,890,839 | | 2027 | $1,317,265 | | 2028 | $1,257,265 | | Thereafter | $1,257,265 | | **Total** | **$8,917,986** | [Note 7: Other Commitments](index=31&type=section&id=Note%207%3A%20Other%20Commitments) The company has various commitments, including management and sports betting agreements, with the BETR online sports betting agreement including equity interest and $3.5 million in deferred revenue - Management fees for Crestline Hotels & Resorts decreased to **$35,109** in Q1 2024 from **$45,500** in Q1 2023[170](index=170&type=chunk) - Management fees for Shula's Steak Houses, LLLP increased to **$24,374** in Q1 2024 from **$0** in Q1 2023[173](index=173&type=chunk) - The online market access agreement with BETR grants the Company a limited equity interest and revenue sharing, with **$3.5 million** in deferred revenue remaining as of March 31, 2024[178](index=178&type=chunk) - Ohio granted an extension to June 30, 2024, for all retail sports betting license holders, as the Company does not currently have a retail sports betting partner[179](index=179&type=chunk) Other Liabilities | Category | March 31, 2024 | December 31, 2023 | | :---------------------- | :------------- | :---------------- | | Activation fund reserves | $243,661 | $126,685 | | Deferred revenue | $8,150,932 | $5,441,640 | | Deposits and other liabilities | $463,906 | $290,357 | | **Total** | **$8,858,499** | **$5,858,682** | [Note 8: Contingencies](index=33&type=section&id=Note%208%3A%20Contingencies) The company is subject to occasional legal proceedings but has no pending litigation expected to materially adversely affect its financial results - The Company does not have any pending litigation that would have a material adverse effect on its results of operations, financial condition, or cash flows[185](index=185&type=chunk) [Note 9: Related-Party Transactions](index=33&type=section&id=Note%209%3A%20Related-Party%20Transactions) Related-party transactions involve advances from IRG Member affiliates and PFHOF, a Global License Agreement, financial support from IRGLLC, and a new lease with a director-managed entity Due to Affiliates | Affiliate | March 31, 2024 | December 31, 2023 | | :---------------- | :------------- | :---------------- | | Due to IRG Member | $1,961,221 | $1,127,390 | | Due to PFHOF | $765,585 | $166,484 | | **Total** | **$2,726,806** | **$1,293,874** | - The Global License Agreement with PFHOF requires annual license fees, ranging from **$600,000** to **$750,000**, and has an initial term through December 31, 2036[192](index=192&type=chunk) - IRGLLC and its affiliates provide financial support, including facilitating waterpark construction financing and extending IRG Affiliate Lender loans to March 31, 2025, in exchange for fees, common stock, and loan modifications[199](index=199&type=chunk)[200](index=200&type=chunk)[201](index=201&type=chunk)[202](index=202&type=chunk)[207](index=207&type=chunk)[208](index=208&type=chunk) - A new ten-year lease agreement was entered into with Touchdown Work Place, LLC, an entity managed by director Stuart Lichter, for approximately **12,331 square feet**[214](index=214&type=chunk) [Note 10: Concentrations](index=38&type=section&id=Note%2010%3A%20Concentrations) The company has significant customer concentrations in sponsorship revenue and accounts receivable, with a few customers accounting for substantial percentages of both - For the three months ended March 31, 2024, two customers represented approximately **34.0%** and **31.5%** of the Company's sponsorship revenue[215](index=215&type=chunk) - As of March 31, 2024, four customers represented approximately **24.3%**, **19.4%**, **13.6%** and **11.1%** of the Company's sponsorship accounts receivable[216](index=216&type=chunk) [Note 11: Leases](index=39&type=section&id=Note%2011%3A%20Leases) The company leases ground for its stadium and facilities, with operating lease right-of-use assets of $7.3 million and lease liabilities of $3.3 million, and lease revenue significantly increased in Q1 2024 Operating Lease Information | Metric | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Right-of-use assets | $7,274,397 | $7,387,693 | | Lease liability | $3,321,009 | $3,440,630 | | Weighted-average remaining lease term | 90.6 years | 91.2 years | | Weighted-average discount rate | 10.0% | 10.0% | Lessor Commitments - Lease Revenue | Period | Amount | | :-------------------------------- | :----------- | | Three months ended March 31, 2024 | $641,577 | | Three months ended March 31, 2023 | $94,540 | | **Increase** | **$547,037** | Future Minimum Lease Revenue (Undiscounted) | Year ending December 31, | Amount | | :------------------------- | :----------- | | 2024 (nine months) | $874,956 | | 2025 | $1,174,695 | | 2026 | $1,184,837 | | 2027 | $1,170,697 | | 2028 | $1,002,686 | | Thereafter | $4,216,921 | | **Total** | **$9,624,792** | [Note 12: Financing Liability](index=42&type=section&id=Note%2012%3A%20Financing%20Liability) Sale-leaseback transactions for the Fan Engagement Zone and waterpark are financing arrangements, with liability increasing to $65.9 million and significant future payments over 99 years - Sale-leaseback transactions for the Fan Engagement Zone and waterpark are accounted for as financing arrangements, meaning the property remains on the Company's books[237](index=237&type=chunk) Financing Liability Carrying Value | Metric | March 31, 2024 | March 31, 2023 | | :-------------------- | :------------- | :------------- | | Carrying value | $65,867,451 | $60,675,230 | Remaining Future Cash Payments Related to Financing Liability (Undiscounted) | Year ending December 31, | Amount | | :------------------------- | :--------------- | | 2024 (nine months) | $4,181,246 | | 2025 | $6,179,956 | | 2026 | $6,328,158 | | 2027 | $6,479,940 | | 2028 | $6,635,387 | | Thereafter | $2,294,927,035 | | **Total Minimum Liability Payments** | **$2,324,731,722** | - On February 23, 2024, the waterpark ground lease was amended to include a **$2.5 million** tenant allowance, an increase in base rent, a pledge of the Company's **20%** interest in the Sports Complex Entity, and the issuance of Series H Common Stock Purchase Warrants[238](index=238&type=chunk) [Note 13: Disposition](index=44&type=section&id=Note%2013%3A%20Disposition) The company sold an 80% interest in its ForeverLawn Sports Complex for $10 million, incurring a $140,041 loss, with the remaining 20% now an equity-method investment - The Company sold an **80%** interest in its ForeverLawn Sports Complex business for a **$10 million** purchase price on January 11, 2024[246](index=246&type=chunk) Loss on Sale of Sports Complex | Item | Amount | | :-------------------------- | :------------- | | Purchase price | $10,000,000 | | Net purchase price | $9,785,778 | | Less: transaction costs | $(159,144) | | Less: book value of net assets sold | $(12,213,120) | | Plus: investment retained | $2,446,445 | | **Loss on sale** | **$(140,041)** | - A **$1.5 million** holdback from the purchase price will be released in three **$500,000** increments over **18 months**[246](index=246&type=chunk) [Note 14: Subsequent Events](index=44&type=section&id=Note%2014%3A%20Subsequent%20Events) Subsequent events include an omnibus extension of IRG-related debt and a waterpark ground lease amendment; the company defaulted on a $1.2 million deferred base rent payment and is negotiating with the landlord - On April 7, 2024, an omnibus extension was executed for several IRG-related debt instruments, extending their maturity to March 31, 2025[249](index=249&type=chunk) - On May 10, 2024, a third amendment to the waterpark ground lease was entered into, removing a clause that prevented a cure period for deferred rent[250](index=250&type=chunk) - The Company has not paid the **$1,197,907** deferred base rent due May 1, 2024, for the waterpark ground lease, which is an event of default[250](index=250&type=chunk) [Item 2. Management's discussion and analysis of financial condition and results of operations](index=46&type=section&id=Item%202.%20Management's%20discussion%20and%20analysis%20of%20financial%20condition%20and%20results%20of%20operations) Management discusses financial performance, condition, revenue and expense trends, recent developments, cash flow analysis, liquidity challenges, and going concern uncertainty [Business Overview](index=46&type=section&id=Business%20Overview) The company operates as a resort and entertainment entity focused on professional football, with diversified assets including Hall of Fame Village, media content, and Ohio sports betting licenses - The Company operates three business verticals: destination-based assets (Hall of Fame Village), Media Company (Hall of Fame Village Media), and gaming (Gold Summit Gaming)[254](index=254&type=chunk) - Phase I assets (Tom Benson Hall of Fame Stadium, ForeverLawn Sports Complex - **20%** owned as of Jan 2024, Media Company, and gaming) are operational[255](index=255&type=chunk) - Phase II assets include Constellation Center for Excellence, Center for Performance, Play Action Plaza, Fan Engagement Zone, two hotels (one existing, one under construction), and the Gameday Bay Waterpark (under construction)[258](index=258&type=chunk) - Gold Summit Gaming holds licenses for physical and online sports betting in Ohio and has an agreement with BETR as its Mobile Management Services Provider[257](index=257&type=chunk) [Key Components of the Company's Results of Operations](index=47&type=section&id=Key%20Components%20of%20the%20Company's%20Results%20of%20Operations) Revenue streams include sponsorships, rents, events, hotel/restaurant, media, and gaming, expected to increase with new attractions, while operating expenses will rise with further development - Revenue is generated from sponsorships, rents, events, exclusive programming, attractions, hotel and restaurant operations, media content, and gaming licenses[259](index=259&type=chunk)[261](index=261&type=chunk) - Operating expenses include production, personnel, campus maintenance, food and beverage costs, hotel operating expenses, and depreciation[263](index=263&type=chunk) - Revenues are expected to increase with the addition of events and the opening of the Gameday Bay Waterpark and Hilton Tapestry Hotel[262](index=262&type=chunk) - Operating expenses are expected to increase with more Phase II assets becoming operational, and the addition of top-performer events and sporting events[264](index=264&type=chunk) [Recent Developments](index=47&type=section&id=Recent%20Developments) Recent developments include CH Capital Term Loan amendments, IRG debt extensions, waterpark ground lease changes, Sports Complex sale, and increased ATM facility agent compensation - Multiple amendments to the CH Capital Term Loan in Q1 2024 increased the principal amount to **$14,417,076**[268](index=268&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk)[272](index=272&type=chunk)[273](index=273&type=chunk) - An omnibus extension on April 7, 2024, extended the maturity date of several IRG-related debt instruments from March 31, 2024, to March 31, 2025[274](index=274&type=chunk) - The waterpark ground lease was amended on February 23, 2024, to include a **$2.5 million** tenant allowance, increased base rent, a pledge of the Company's **20%** interest in the Sports Complex Entity, and issuance of Series H Common Stock Purchase Warrants[275](index=275&type=chunk) - On January 11, 2024, the Company sold an **80%** interest in the ForeverLawn Sports Complex for **$10 million**, forming a strategic partnership for youth sports programming[277](index=277&type=chunk)[278](index=278&type=chunk) - ErieBank released **$1,830,000** of held-back loan proceeds for waterpark construction and reduced the loan commitment by **$2,000,000** on March 15, 2024[281](index=281&type=chunk) - Amendment No. 2 to the Equity Distribution Agreement, effective April 8, 2024, increased agent compensation from **2.0%** to **4.0%** for the ATM facility[282](index=282&type=chunk) [Results of Operations](index=51&type=section&id=Results%20of%20Operations) Total revenues increased by 34.3% to $4.2 million in Q1 2024, and net loss improved by 24.6% to $14.6 million due to decreased operating expenses, despite higher interest expense | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | Change ($) | Change (%) | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :--------- | :--------- | | Sponsorships, net of activation costs | $859,731 | $673,475 | $186,256 | 27.7% | | Event, rents, restaurant and other revenue | $2,054,877 | $908,312 | $1,146,565 | 126.2% | | Hotel revenues | $1,276,707 | $1,538,646 | $(261,939) | (17.0%) | | **Total revenues** | **$4,191,315** | **$3,120,433** | **$1,070,882** | **34.3%** | | Operating expenses | $6,150,364 | $12,528,716 | $(6,378,352) | (50.9%) | | Hotel operating expenses | $974,432 | $1,459,203 | $(484,771) | (33.2%) | | Impairment expense | $0 | $1,145,000 | $(1,145,000) | (100.0%) | | Depreciation expense | $4,158,750 | $2,553,360 | $1,605,390 | 62.9% | | Interest expense, net | $(6,521,534) | $(3,632,637) | $(2,888,897) | 79.5% | | Amortization of discount on note payable | $(955,322) | $(855,891) | $(99,431) | 11.6% | | Change in fair value of warrant liability | $49,000 | $(238,000) | $287,000 | 120.6% | | Loss on sale of asset | $(140,041) | $0 | $(140,041) | N/A | | Income from equity method investments | $29,952 | $0 | $29,952 | N/A | | **Net loss** | **$(14,630,176)** | **$(19,392,374)** | **$4,762,198** | **(24.6%)** | [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces significant liquidity challenges with a $231.5 million accumulated deficit and $90.6 million debt due through May 2025, requiring additional financing and raising going concern doubts - Accumulated deficit was **$231.5 million** as of March 31, 2024[298](index=298&type=chunk) Cash and Debt Maturities | Metric | As of March 31, 2024 | | :-------------------------------- | :------------------- | | Unrestricted cash | $2.7 million | | Restricted cash | $4.2 million | | Debt principal payments due through May 14, 2025 | $90.6 million | - The Company used **$2.5 million** cash for operating activities during the three months ended March 31, 2024[298](index=298&type=chunk) - Management expects to need additional financing through debt, construction lending, and equity to fund its development plan and working capital[299](index=299&type=chunk) - These conditions raise substantial doubt about the Company's ability to continue as a going concern[299](index=299&type=chunk) [Cash Flows](index=53&type=section&id=Cash%20Flows) Net cash used in operating activities decreased by $9.1 million, investing activities by $21.7 million due to asset sales, and financing activities provided $16.9 million less cash | Cash Flow Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | Change ($) | Change (%) | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :--------- | :--------- | | Operating Activities | $(2,476,875) | $(11,542,932) | $9,066,057 | (78.5%) | | Investing Activities | $(2,967,807) | $(24,679,007) | $21,711,200 | (88.0%) | | Financing Activities | $512,766 | $17,406,477 | $(16,893,711) | (97.1%) | | **Net decrease in cash and restricted cash** | **$(4,931,916)** | **$(18,815,462)** | **$13,883,546** | **(73.8%)** | - The decrease in cash used in operating activities was primarily attributable to a **$4.7 million** decrease in net loss[301](index=301&type=chunk) - The decrease in cash used in investing activities was due to **$15 million** invested in treasury bills in Q1 2023, offset by an **$8.1 million** increase from asset sales in Q1 2024[303](index=303&type=chunk) - The decrease in cash provided by financing activities was primarily due to an **$11.8 million** decrease in notes payable proceeds and a **$10.6 million** increase in repayments of notes payable, partially offset by **$3.5 million** in proceeds from financing liability[304](index=304&type=chunk) [Off-Balance Sheet Arrangements](index=55&type=section&id=Off-Balance%20Sheet%20Arrangements) As of March 31, 2024, the company had no off-balance sheet arrangements - The Company did not have any off-balance sheet arrangements as of March 31, 2024[305](index=305&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=55&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) Financial statement preparation requires management estimates and assumptions based on historical experience, which may differ from actual results - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenue, and expenses[306](index=306&type=chunk) - Key estimates and assumptions relate to credit losses, depreciation, capitalized project development costs, useful lives of long-lived assets, impairment, stock-based compensation, and fair value of financial instruments[39](index=39&type=chunk) [Item 3. Quantitative and qualitative disclosures about market risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20qualitative%20disclosures%20about%20market%20risk) No quantitative or qualitative disclosures about market risk are applicable to the company for the reported period - This item is not applicable to the Company[308](index=308&type=chunk) [Item 4. Controls and procedures](index=55&type=section&id=Item%204.%20Controls%20and%20procedures) The company's disclosure controls were ineffective as of March 31, 2024, due to a material weakness in financial reporting review, with remediation efforts underway - A material weakness in internal control over financial reporting was identified related to the precise and timely review and analysis of information for financial statements and disclosures[310](index=310&type=chunk) - As of March 31, 2024, the disclosure controls and procedures were not effective at the reasonable assurance level[311](index=311&type=chunk) - Despite the material weakness, management concluded that the condensed consolidated financial statements fairly present the financial position, results of operations, and cash flows[311](index=311&type=chunk) - Additional controls were implemented during Q1 2024 to remediate the material weakness, with a plan to test their effectiveness[313](index=313&type=chunk) [PART II. OTHER INFORMATION](index=57&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal proceedings](index=57&type=section&id=Item%201.%20Legal%20proceedings) The company is subject to routine legal proceedings but has no pending litigation expected to materially adversely affect its financial condition or operations - The Company does not have any pending litigation that, separately or in the aggregate, would have a material adverse effect on its results of operations, financial condition, or cash flows[315](index=315&type=chunk) [Item 1A. Risk factors](index=57&type=section&id=Item%201A.%20Risk%20factors) No material changes to risk factors since the 2023 10-K, except for a director exploring a potential extraordinary corporate transaction, creating uncertainty - Stuart Lichter, a director, and his affiliates are exploring a potential extraordinary corporate transaction (e.g., merger, reorganization, go-private, debt restructuring) with the Company[316](index=316&type=chunk)[317](index=317&type=chunk) - This speculation creates uncertainty for visitors, partners, and employees, potentially impacting operations, employee retention, and management focus[321](index=321&type=chunk) [Item 2. Unregistered sales of equity securities and use of proceeds](index=58&type=section&id=Item%202.%20Unregistered%20sales%20of%20equity%20securities%20and%20use%20of%20proceeds) The company made several unregistered sales of equity securities through 2020 Convertible Term Loan amendments, advancing $8.1 million in Q1 2024, convertible at $3.64 per share and exempt from registration - On January 11, 2024, the 2020 Convertible Term Loan was amended to advance **$4,400,000**, increasing the principal to **$10,542,308**[322](index=322&type=chunk) - Further amendments on January 17, February 1, and February 28, 2024, advanced an additional **$2,200,000**, **$800,000**, and **$726,634** respectively, increasing the principal to **$14,417,076**[324](index=324&type=chunk)[325](index=325&type=chunk)[326](index=326&type=chunk) - These advances are convertible into common stock at **$3.64** per share and are exempt from registration under Section 4(a)(2) of the Securities Act[322](index=322&type=chunk)[324](index=324&type=chunk)[325](index=325&type=chunk)[326](index=326&type=chunk) - The Company and CHCL agreed to a Nasdaq **19.99%** Cap on common stock issuance without stockholder approval, with the Company committed to seeking approval if necessary[327](index=327&type=chunk) [Item 3. Defaults upon senior securities](index=59&type=section&id=Item%203.%20Defaults%20upon%20senior%20securities) The company reported no defaults upon senior securities for the period - No defaults upon senior securities were reported[328](index=328&type=chunk) [Item 4. Mine safety disclosures](index=59&type=section&id=Item%204.%20Mine%20safety%20disclosures) This item is not applicable to the company - This item is not applicable to the Company[329](index=329&type=chunk) [Item 5. Other information](index=59&type=section&id=Item%205.%20Other%20information) The company defaulted on a $1.2 million deferred base rent payment for the waterpark ground lease and is negotiating with the landlord to extend the forbearance payment date - The Company has not paid the deferred base rent of **$1,197,907** due May 1, 2024, for the waterpark ground lease[330](index=330&type=chunk) - Failure to cure this non-payment within three days of written notice would be an event of default, potentially leading to acceleration of all remaining payments[330](index=330&type=chunk) - Negotiations are underway with the landlord to extend the base rent forbearance payment date[330](index=330&type=chunk) [Item 6. Exhibits](index=60&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including various amendments to loan, security, and lease agreements, and certifications, supporting financial statements and disclosures - Exhibit 1.1: Amendment No. 2 to Equity Distribution Agreement, dated April 8, 2024[332](index=332&type=chunk) - Exhibits 10.1-10.8: Multiple amendments to Term Loan Agreements and Secured Cognovit Promissory Notes with CH Capital Lending, LLC, dated January 2024[332](index=332&type=chunk) - Exhibits 10.9-10.13: Amendments to Lease Agreements, Pledge and Security Agreement, and Series H Common Stock Purchase Warrant related to the waterpark, dated February 2024[332](index=332&type=chunk)[333](index=333&type=chunk)[334](index=334&type=chunk) - Exhibit 10.14: Omnibus Extension of Debt Instruments, dated April 7, 2024, with various lenders[334](index=334&type=chunk) - Exhibit 10.15: Third Amendment to Lease Agreement, dated May 10, 2024, for the waterpark ground lease[334](index=334&type=chunk)