# EDGAR Filing Document

**Accession Number:** 0001866782
**File Stem:** 0001829126-25-004113
**Filing Date:** 2025-6
**Character Count:** 1132108
**Document Hash:** 5b94cfb1569402395ef8f79494ae7ae4
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001829126-25-004113.hdr.sgml**: 20250602

**ACCESSION NUMBER**: 0001829126-25-004113

**CONFORMED SUBMISSION TYPE**: 20-F

**PUBLIC DOCUMENT COUNT**: 118

**CONFORMED PERIOD OF REPORT**: 20241231

**FILED AS OF DATE**: 20250602

**DATE AS OF CHANGE**: 20250602

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Codere Online Luxembourg, S.A.
- **CENTRAL INDEX KEY:** 0001866782
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 000000000
- **STATE OF INCORPORATION:** N4
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 20-F
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41107
- **FILM NUMBER:** 251013091

**BUSINESS ADDRESS:**
- **STREET 1:** 7 RUE ROBERT STUMPER
- **CITY:** LUXEMBOURG
- **STATE:** N4
- **ZIP:** L-2557
- **BUSINESS PHONE:** 352 26 25 88 88

**MAIL ADDRESS:**
- **STREET 1:** 7 RUE ROBERT STUMPER
- **CITY:** LUXEMBOURG
- **STATE:** N4
- **ZIP:** L-2557

?xml version='1.0' encoding='ASCII'?

**UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549**

**FORM 20-F**

(Mark One)

☐ **REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

☒ **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the fiscal year ended December 31, 2024**

**OR**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

☐ **SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**Commission File Number: 001-41107**

**Codere Online Luxembourg, S.A.**

(Exact name of Registrant as specified in its charter)

N/A

(Translation of Registrant's name into English)

**Grand Duchy of Luxembourg** 

(Jurisdiction of incorporation or organization)

**7 rue Robert Stümper**

**L-2557 Luxembourg**

**Grand Duchy of Luxembourg**

**R.C.S. Luxembourg: B255798**

**+34 91354 28 19 (Address of principal executive offices)**

**Guillermo Lancha, Director of Investor Relations**

**ir@codereonline.com**

**+34 91354 28 00**

**Avda. Bruselas, 26**

**28108 Alcobendas, Madrid**

(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)

**Securities registered or to be registered pursuant to Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| **Ordinary Shares** | **CDRO** | **Nasdaq Stock Market LLC** |
| **Warrants** | **CDROW** | **Nasdaq Stock Market LLC** |

---

**Securities registered or to be registered pursuant to Section 12(g) of the Act: None**

**Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:** None

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report: 45,491,175 ordinary shares, nominal value €1.00 per share, as of December 31, 2024 6,435,000 warrants to purchase ordinary shares, as of December 31, 2024

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☒

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or an emerging growth company. See definition of "accelerated filer," "large accelerated filer," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐ Accelerated filer ☒ Non-accelerated filer ☐ <br> Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

† The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☐ International Financial Reporting Standards as issue by the International Accounting Standards Board ☒ Other ☐

If "Other" has been checked in response to the previous question indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  |  | **Page** |
| [Selected Definitions](#a_001) | [Selected Definitions](#a_001) | 1 |
| [Presentation of Financial and Other Information](#a_002) | [Presentation of Financial and Other Information](#a_002) | 9 |
| [Preparation of the Annual Financial Statements](#a_003) | [Preparation of the Annual Financial Statements](#a_003) | 10 |
| [Intellectual Property](#a_004) | [Intellectual Property](#a_004) | 12 |
| [Industry and Market Information](#a_005) | [Industry and Market Information](#a_005) | 13 |
| [Cautionary Note Regarding Forward-Looking Statements](#a_006) | [Cautionary Note Regarding Forward-Looking Statements](#a_006) | 14 |
|  | [**PART I**](#a_007) |  |
| [Item 1.](#a_008) | [Identity of Directors, Senior Management and Advisers](#a_008) | 16 |
| [Item 2.](#a_009) | [Offer Statistics and Expected Timetable](#a_009) | 16 |
| [Item 3.](#a_010) | [Key Information](#a_010) | 16 |
| [Item 4.](#a_011) | [Information on the Company](#a_011) | 60 |
| [Item 4A.](#a_012) | [Unresolved Staff Comments](#a_012) | 86 |
| [Item 5.](#a_013) | [Operating and Financial Review and Prospects](#a_013) | 87 |
| [Item 6.](#a_014) | [Directors, Senior Management and Employees](#a_014) | 121 |
| [Item 7.](#a_015) | [Major Shareholders and Related Party Transactions](#a_015) | 130 |
| [Item 8.](#a_016) | [Financial Information](#a_016) | 144 |
| [Item 9.](#a_017) | [The Offer and Listing](#a_017) | 145 |
| [Item 10.](#a_018) | [Additional Information](#a_018) | 145 |
| [Item 11.](#a_019) | [Quantitative and Qualitative Disclosures about Market Risks](#a_019) | 161 |
| [Item 12.](#a_020) | [Description of Securities Other Than Equity Securities](#a_020) | 161 |
|  | [**PART II**](#a_021) |  |
| [Item 13.](#a_022) | [Defaults, Dividend Arrearages and Delinquencies](#a_022) | 162 |
| [Item 14.](#a_023) | [Material Modifications to the Rights of Security Holders and Use of Proceeds](#a_023) | 162 |
| [Item 15.](#a_024) | [Controls and Procedures](#a_024) | 162 |
| [Item 16.](#a_025) | [\[Reserved\]](#a_025) | 165 |
| [Item 16A.](#a_026) | [Audit Committee Financial Expert](#a_026) | 165 |
| [Item 16B.](#a_027) | [Code of Ethics](#a_027) | 165 |
| [Item 16C.](#a_028) | [Principal Accountant Fees and Services](#a_028) | 165 |
| [Item 16D.](#a_029) | [Exemptions from the Listing Standards for Audit Committees](#a_029) | 166 |
| [Item 16E.](#a_030) | [Purchases of Equity Securities by the Issuer and Affiliated Purchasers](#a_030) | 166 |
| [Item 16F.](#a_031) | [Change in Registrant's Certifying Accountant](#a_031) | 166 |
| [Item 16G.](#a_032) | [Corporate Governance](#a_032) | 166 |
| [Item 16H.](#a_033) | [Mine Safety Disclosure](#a_033) | 168 |
| [Item 16I.](#a_034) | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#a_034) | 168 |
| [Item 16J.](#a_035) | [Insider Trading Policies](#a_035) | 168 |
| [Item 16K.](#a_036) | [Cybersecurity](#a_036) | 168 |
|  | [**PART III**](#a_037) |  |
| [Item 17.](#a_038) | [Financial Statements](#a_038) | 170 |
| [Item 18.](#a_039) | [Financial Statements](#a_039) | 170 |
| [Item 19.](#a_040) | [Exhibits](#a_040) | 170 |

---

i

[**Table of Contents**](#toc)

**Selected Definitions**

In this document, unless the context otherwise requires:

"1915 Law" means the Luxembourg Law of August 10, 1915 on commercial companies, as amended from time to time (*loi du 10 août 1915 sur les sociétés commerciales, telle que modifiée*).

"AenP Agreement" means the *Contrato de Asociación en Participación*, dated June 21, 2021, by and between SEJO and Libros Foráneos, S.A. de C.V., which became effective on the Merger Effective Time, as amended from time to time. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*AenP Agreement.*"

"ALTA" means Alta Cordillera, S.A., a corporation (*sociedad anónima*) registered and incorporated under the laws of Panama.

"ALTA License" means the standalone online gaming license granted to ALTA in Panama, under which ALTA is authorized to conduct online gaming operations in Panama for a twenty (20) year term from December 1, 2021.

"Amendments" means Law 11/2021, which amended section (c), paragraph 2 of Article 13 of the Spanish Gaming Law.

"Ancillary Agreements" means the Contribution and Exchange Agreement, the Registration Rights and Lock-Up Agreement, the Nomination Agreement, the Indemnification Letter, the Warrant Amendment Agreement, and all other agreements, certificates and instruments executed and delivered by DD3, Codere Newco, Codere Online, Merger Sub or SEJO in connection with the Transactions and specifically contemplated by the Business Combination Agreement.

"Annual Financial Statements" means the (i) audited consolidated financial statements of Codere Online as of and for the years ended December 31, 2024 and 2023 and (ii) the audited consolidated carve-out financial statements of Codere Online as of and for the year ended December 31, 2022, prepared in accordance with IFRS, as adopted by the International Accounting Standards Board, and the accompanying notes.

"Argentina Restructuring Agreement" refers to the agreement entered into between Iberargen, S.A. a subsidiary of the Codere Group, and SEJO on November 15, 2021, as amended on November 30, 2021 and as further amended on March 28, 2022 to include Codere Argentina as a party thereto. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Argentina Restructuring Agreement*."

"Average monthly active players" means average monthly real money (i.e., excludes free bets) sports betting and casino active players. Figures may change from prior reporting, which only included real money sports betting.

"Baron" means Baron Global Advantage Fund, Baron Emerging Markets Fund and Destinations International Equity Fund.

"Baron Forward Purchase Agreement" means that certain Forward Purchase Agreement, dated as of November 17, 2020, by and between DD3 and Baron, as amended by the Baron FPA Amendment.

"Baron FPA Amendment" means Amendment No. 1 to the original Baron Forward Purchase Agreement, dated as of June 21, 2021, by and between DD3 and Baron.

"Baron IPO Shares" refers to the 996,069 Public Shares acquired by Baron in the IPO that Baron agreed not to redeem pursuant to the Baron Support Agreement.

"Baron Support Agreement" means the Investor Support Agreement, dated as of June 21, 2021, by and between DD3 and Baron.

[**Table of Contents**](#toc)

"Buenos Aires License" means the permit granted to Iberargen S.A. by LOTBA under code DI-2021-238-GCABA-LOTBA on March 12, 2021 for a period of five (5) years and transferred to Codere Online Argentina, S.A. on May 3, 2023.

"Business Combination" means the transactions contemplated by the Business Combination Agreement, including the Restructuring, the Exchange, the Class B Conversion, the Merger and the Codere Online Capital Increase.

"Business Combination Agreement" means the Business Combination Agreement, dated as of June 21, 2021, as may be amended, supplemented, or otherwise modified from time to time, by and among DD3, Codere Newco, SEJO, Codere Online and Merger Sub.

"Codere Argentina" means Codere Argentina, S.A., a company incorporated in Argentina and a wholly-owned subsidiary of Iberargen, S.A.

"CDON" means Codere Online, S.A.U., a corporation (*sociedad anónima unipersonal*) registered and incorporated under the laws of Spain.

"CDON Licenses" means the following online licenses granted by the DGOJ to CDON: (A) three (3) general licenses for a ten (10) year term which were extended for ten (10) additional years (until May 31, 2032): (i) Other Games License, (ii) Betting License and (iii) Contests License; and (B) six (6) singular licenses for: (i) slots (renewed until December 12, 2029), (ii) roulette (renewed until December 12, 2027), (iii) black jack (renewed until December 12, 2027), (iv) sports betting (renewed until December 12, 2029), (v) horse betting (renewed until February 20, 2029) and (vi) other bets (renewed until December 12, 2029).

"CIMSS" means Codere Israel Marketing Support Services L.T.D.

"Class B Conversion" means the automatic conversion and exchange that occurred immediately prior to the Merger Effective Time pursuant to the Business Combination Agreement of each share of DD3 Class B Common Stock for one validly issued, fully paid and non-assessable share of DD3 Class A Common Stock.

"Closing" means the consummation of the Business Combination on the Closing Date.

"Closing Date" means November 30, 2021.

"Code" means the Internal Revenue Code of 1986, as amended.

"Codere Group" means (i) until November 18, 2021, Codere, S.A. and its subsidiaries; (ii) from November 18, 2021 until September 30, 2024, Codere New Topco S.A. and its subsidiaries; and (iii) as of September 30, 2024, Codere Group Topco, S.A., its successors and assigns, and its subsidiaries from time to time, including Codere Newco.

"Codere Newco" means Codere Newco, S.A.U., a corporation (*sociedad anónima unipersonal*) registered and incorporated under the laws of Spain.

"Codere Online," the "Company," "we," "our" and "us" refer to, unless the context otherwise requires, means Codere Online Luxembourg, S.A., a limited liability company (*société anonyme*) governed by the laws of the Grand Duchy of Luxembourg having its registered office at 7 rue Robert Stümper, L-2557 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Companies Register (*Registre de Commerce et des Sociétés, Luxembourg*) under number B255798, and its subsidiaries, including the Codere Online Business contributed to Codere Online, or in respect of which Restructuring Agreements were entered into, in connection with the consummation of the Business Combination.

[**Table of Contents**](#toc)

"Codere Online Capital Increase" means the share capital increase of Codere Online by way of the Ordinary Shares Merger Issuance.

"Codere Online Board" means the board of directors of Codere Online.

"Codere Online Business" means the entities and/or businesses of the Codere Group focused on online gambling and other online services in Spain, Mexico, Colombia, Panama, Italy, Gibraltar, Israel, Malta and Argentina, which were either transferred to Codere Online at the time of the Exchange or in respect of which Restructuring Agreements were entered into.

"Codere Online Panama" means Operating Management Services Panama, S.A. (formerly Codere Online Panama, S.A.), a subsidiary of Codere Online incorporated in Panama.

"Codere Online Private Warrants" means the 185,000 Private Warrants that converted into Codere Online Warrants on the Closing Date.

"Codere Online Public Warrants" means the 6,250,000 Public Warrants that converted into Codere Online Warrants on the Closing Date.

"Codere Online Shareholders" means holders of Ordinary Shares.

"Codere Online Warrants" means the DD3 Warrants as converted into warrants of Codere Online representing the right to purchase Ordinary Shares, pursuant to the Warrant Amendment Agreement entered into in connection with the Merger and on substantially the same terms as were in effect immediately prior to the Merger Effective Time under the terms of the Original Warrant Agreement.

"Colombia License" means license C1470, which allows for the operation of online gaming, originally granted by the Colombian gaming regulator, Coljuegos, to Codere Colombia, S.A., a subsidiary of the Codere Group. The Colombia License was transferred to Codere Online Colombia S.A.S., a subsidiary of Codere Online, in 2022. The license was originally granted for a term of five (5) years until November 15, 2022 and was subsequently renewed until November 14, 2025 pursuant to contract C1901.

"Colombia Restructuring Agreements" refers to the sale and transfer agreement, the joint accounts agreement (*contrato de cuentas en participación*) and the license assignment agreement entered into among Codere Colombia, S.A., a subsidiary of the Codere Group, and Codere Online Colombia S.A.S., a subsidiary of Codere Online, on November 15, 2021, in each case as amended on November 30, 2021. See Item 7.B. "*Related Party Transactions*—*Material Agreements—Colombia Restructuring Agreements*."

"Continental" means Continental Stock Transfer & Trust Company, Codere Online's transfer agent, registrar and warrant agent.

"Contribution and Exchange Agreement" means that certain Contribution and Exchange Agreement, dated as of June 21, 2021, by and between Codere Online, SEJO and Codere Newco.

"DD3" means (i) prior to the Merger Effective Time, DD3 Acquisition Corp. II, a Delaware corporation and (ii) following the Merger Effective Time, Codere Online U.S. Corp., a Delaware corporation and wholly-owned subsidiary of Codere Online.

"DD3 Capital" means DD3 Capital Partners S.A. de C.V.

"DD3 Capital Subscription Agreement" means the Subscription Agreement, dated as of June 21, 2021, by and among DD3, DD3 Capital and Codere Online, pursuant to which, among other things, DD3 Capital agreed to subscribe for, and DD3 agreed to sell, upon the terms and subject to the conditions of the DD3 Capital Subscription Agreement, 500,000 shares of DD3 Class A Common Stock for an aggregate purchase price of $5,000,000, at a price of $10.00 per each share of DD3 Class A Common Stock, immediately prior to the Closing Date.

[**Table of Contents**](#toc)

"DD3 Class A Common Stock" means the Class A common stock of DD3, par value $0.0001 per share.

"DD3 Class B Common Stock" means the Class B common stock of DD3, par value $0.0001 per share.

"DD3 Common Stock" means the DD3 Class A Common Stock and the DD3 Class B Common Stock, collectively.

"DD3 Units" means the Public Units and the Private Placement Units, collectively.

"DD3 Warrants" means the Public Warrants and the Private Warrants, collectively.

"DGOJ" means the Spanish Directorate General for the Regulation of Gambling (*Dirección General de Ordenación del Juego*), the Spanish gaming regulator.

"Exchange" means the contribution and exchange, effective on the Exchange Effective Time, by Codere Newco of its SEJO Ordinary Shares to Codere Online in exchange for additional Ordinary Shares, which were subscribed for by Codere Newco, as contemplated by and pursuant to the Contribution and Exchange Agreement.

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Exchange Effective Time" means 10:00 a.m. New York time on November 29, 2021.

"Expenses Reimbursement Letter" means that certain letter agreement entered into immediately prior to the Closing by and among the Sponsor, DD3, Codere Newco and Codere Online.

"Forward Purchase Agreements" means, collectively, (i) the Baron Forward Purchase Agreement and (ii) the MG Forward Purchase Agreement, in each case as may be amended from time to time.

"Forward Purchase Amendments" means, collectively, (i) the Baron FPA Amendment and (ii) the MG FPA Amendment.

"Forward Purchasers" means Baron and MG, and their permitted transferees under the Forward Purchase Agreements, collectively.

"Forward Purchase Shares" means an aggregate of 5,000,000 shares of DD3 Class A Common Stock issued to the Forward Purchasers in a private placement immediately prior to the Closing pursuant to the Forward Purchase Agreements, which shares were exchanged for Ordinary Shares upon consummation of the Business Combination.

"HIPA" means Hípica de Panamá, S.A., a corporation (*sociedad anónima*) registered and incorporated under the laws of Panama.

"HIPA License" means Resolution No. 921 of September 21, 2017 which authorizes to operate online sports betting by virtue of Contract No. 1 of April 16, 2018 (under which HIPA was awarded 5 licenses for a five (5) year term, renewable for another five (5) years) and Contract No. 193 of 4 October 4, 2005 (under which HIPA was awarded 51 licenses for a twenty (20) year term).

"IASB" means the International Accounting Standards Board.

"IFRS" means the International Financial Reporting Standards, as issued by the IFRS Foundation and the International Accounting Standards Board (IASB), as in effect from time to time.

[**Table of Contents**](#toc)

"Indemnification Letter" means the indemnification entered into by Codere Newco, Codere Online and SEJO at Closing.

"IPO" means DD3's initial public offering of Public Units, consummated on December 10, 2020.

"Italy License" means Remote Gaming License no. 15411 granted to Codere Scommese S.r.l. on October 7, 2019, which expired on December 31, 2022. On December 30, 2022, Codere Online sold Codere Scommese S.r.l. and ceased its operations in Italy.

"JOBS Act" means the Jumpstart Our Business Startups Act of 2012, as amended.

"Larrain" means Larrain Investment Inc.

"Larrain Subscription Agreement" means the Subscription Agreement, dated as of June 21, 2021, by and among DD3, Larrain and Codere Online, pursuant to which, among other things, Larrain subscribed for, and DD3 sold, upon the terms and subject to the conditions of the Larrain Subscription Agreement, 1,211,000 shares of DD3 Class A Common Stock for an aggregate purchase price of $12,110,000, at a price of $10.00 per each share of DD3 Class A Common Stock, immediately prior to the Closing Date.

"LIFO" means Libros Foráneos, S.A. de C.V.

"LIFO License" means license 2768 granted to LIFO in May 1990, which was renewed for a period of 12 years under Official Letter DGJS/1018/2015, expiring on May 10, 2027, which allows for the operation of 18 retail locations in Mexico and online gaming. By virtue of Official Letter No. DGJS/234/2019, dated March 14, 2019 the Ministry of Interior authorizes Codere Online to operate online gaming through the website "codere.mx".

"Merger" means the merger of Merger Sub with and into DD3, with DD3 surviving the Merger as a wholly-owned subsidiary of Codere Online. In connection therewith, DD3's corporate name changed to "Codere Online U.S. Corp."

"Merger Consideration" has the meaning ascribed to it in the Business Combination Agreement.

"Merger Effective Time" means 12:01 a.m. New York time on November 30, 2021.

"Merger Sub" means Codere Online U.S. Corp., a Delaware corporation, which merged with and into DD3 at the Merger Effective Time, with DD3 surviving the Merger.

"MG" means MG Partners Multi-Strategy Fund LP, an Ontario limited partnership.

"MG Forward Purchase Agreement" means that certain Forward Purchase Agreement, dated as of November 19, 2020, by and between DD3 and MG, as amended by the MG FPA Amendment.

"MG FPA Amendment" means Amendment No. 1 to the original MG Forward Purchase Agreement, dated as of June 21, 2021, by and between DD3 and MG.

"Nasdaq" means The Nasdaq Stock Market LLC.

"net gaming revenue" means all gross amounts wagered on Codere Online less: (i) player wins, (ii) player bonuses and (iii) promotional bets, subject to certain adjustments. See Item 5.A "*Operating Results—Non-GAAP Financial Data"* for reconciliations of net gaming revenue to revenue.

[**Table of Contents**](#toc)

"New Platform and Technology Services Agreement" means the Platform and Technology Services Agreement, effective January 1, 2023, by and among CDON, SEJO, Codere Newco and Codere Apuestas España, S.L.U. for the provision of platform and technology services by Codere Newco and Codere Apuestas España, S.L.U. to SEJO and CDON's online casino and sports betting businesses. See Item 7.B. "*Related Party Transactions*—*Material Agreements—Platform and Technology Services Agreement.*"

"Nomination Agreement" means that certain nomination agreement entered into by Codere Newco, Codere Online and the Sponsor at Closing.

"ONOL" means Codere Online Operator Limited, a private limited company incorporated in Malta.

"OMSE" means Codere Online Management Services Limited, a private limited company incorporated in Malta.

"Ordinary Shares" means the ordinary shares of Codere Online, with a nominal value of €1.00 per share.

"Ordinary Shares Merger Issuance" means the issuance of one Ordinary Share in consideration of each share of DD3 Class A Common Stock issued and outstanding immediately prior to the Merger Effective Time (which for the avoidance of doubt did not include shares of DD3 Class A Common Stock as to which Redemption Rights were exercised).

"Original Platform and Technology Services Agreement" means the Platform and Technology Services Agreement, effective January 1, 2021, by and among Codere Newco, OMSE and Codere Apuestas España, S.L.U., as amended on March 1, 2022 and September 2, 2022 and as further amended from time to time, for the provision of platform and technology services by Codere Newco and Codere Apuestas España, S.L.U. to OMSE's online casino and sports betting business, which was terminated on December 31, 2022 and substituted by the New Platform and Technology Services Agreement. See Item 7.B. "*Related Party Transactions—Material Agreements—Platform and Technology Services Agreement.*"

"Original Warrant Agreement" means the warrant agreement, dated as of December 7, 2020, by and between DD3 and Continental, as warrant agent, governing the DD3 Warrants.

"Panama Restructuring Agreements" refers collectively to the agreement entered into among Codere Online Panama and HIPA on November 15, 2021, as amended on November 30, 2021, and the agreement entered into by Codere Online Panama and ALTA on December 1, 2021. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Panama Restructuring Agreements*."

"PCAOB" means the Public Company Accounting Oversight Board.

"PIPE" means the private placement pursuant to which the Subscribers purchased the PIPE Shares immediately prior to the Closing.

"PIPE Shares" means the shares of DD3 Class A Common Stock issued to the Subscribers in the PIPE, which shares were exchanged for Ordinary Shares upon consummation of the Business Combination. An aggregate of 1,711,000 shares of DD3 Class A Common Stock were issued to the Subscribers in the PIPE.

"Private Placement Units" means the aggregate 370,000 units purchased by the Sponsor and the Forward Purchasers in a private placement in connection with the IPO, each of which consisted of one Private Share and one-half of one Private Warrant.

"Private Shareholders" means the holders of Private Shares, and their permitted transferees, collectively.

"Private Shares" means the shares of DD3 Class A Common Stock issued as part of the Private Placement Units.

[**Table of Contents**](#toc)

"Private Warrants" means the warrants included in the Private Placement Units, each of which was exercisable for one share of DD3 Class A Common Stock.

"Proxy Statement" means the definitive proxy statement filed by DD3 with the SEC on October 27, 2021.

"Public Shares" means the shares of DD3 Class A Common Stock issued as part of the Public Units.

"Public Stockholders" means the holders of Public Shares.

"Public Units" means the 12,500,000 units issued in the IPO, each of which consisted of one Public Share and one-half of one Public Warrant.

"Public Warrants" means the warrants included in the Public Units, each of which was exercisable for one share of DD3 Class A Common Stock.

"Redemption Rights" means the redemption rights provided for in Article IX of the DD3 Certificate of Incorporation.

"Relationship and License Agreement" means the Relationship and License Agreement, dated June 21, 2021, by and between Codere Newco and SEJO, which became effective as of the Merger Effective Time. See Item 7.B. "*Related Party Transactions*—*Material Agreements—Relationship and License Agreement.*"

"Registration Rights and Lock-Up Agreement" means that certain registration rights and lock-up agreement entered into by DD3, Codere Newco, Codere Online, the Sponsor, the Forward Purchasers and the other parties thereto, at Closing.

"Restructuring" means the corporate restructuring pursuant to which all of the Codere Group's online gaming, gambling, casino, slots, poker, bingo, sports betting, betting exchanges, lottery operations, racing, and pari-mutuel activities became operated or owned, as applicable, by SEJO and its subsidiaries by holding or receiving assets, rights and/or entities from the Codere Group, as set forth in the Business Combination Agreement; except that, in Colombia, Panama and the City of Buenos Aires (Argentina), in lieu of causing the consummation of the restructuring step plan agreed with DD3 in respect of each of such jurisdictions, the Codere Online entered into a Restructuring Agreement with the relevant subsidiaries of Codere Group in the affected jurisdiction.

"Restructuring Agreements" refers, collectively, to the Colombia Restructuring Agreements, the Panama Restructuring Agreements and the Argentina Restructuring Agreement and "Restructuring Agreement" refers to one or any of such agreements, as the context may require.

"RM Sponsorship Agreement" means the sponsorship agreement ("*Contrato de Patrocinio*"), dated October 11, 2016, between Codere Newco and Real Madrid Club de Fútbol, as amended on April 10, 2019, November 24, 2020 and October 7, 2021 and as further amended from time to time, pursuant to which, Codere Online is, and is expected to continue to be, the licensee of certain rights, marks, names, images, designations, anthems, photographs and brands set forth under the RM Sponsorship Agreement.

"SEC" means the U.S. Securities and Exchange Commission.

"Securities Act" means the Securities Act of 1933, as amended.

"SEJO" means Servicios de Juego Online S.A.U., a corporation (*sociedad anónima unipersonal*) registered and incorporated under the laws of Spain.

"SEJO Ordinary Shares" means the ordinary shares of SEJO, with a nominal value of €1.00 per share.

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"Spanish Gaming Law" means Spanish Law 13/2011, of May 27, on gaming regulation, as amended.

"Sponsor" means DD3 Sponsor Group, LLC, a Delaware limited liability company.

"Sponsorship and Services Agreement" means the Sponsorship and Services Agreement, dated June 21, 2021, by and between Codere Newco and SEJO, which became effective as of the Merger Effective Time. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Sponsorship and Services Agreement.*"

"Subscribers" means DD3 Capital, Larrain and their permitted transferees under the Subscription Agreements, collectively.

"Subscription Agreements" means the DD3 Capital Subscription Agreement and the Larrain Subscription Agreement.

"Supporting Entities" means OMSE, Codere Israel Marketing Support Services LTD, Codere Online, Codere (Gibraltar) Marketing Services LTD, SEJO and Surviving Corporation.

"Surviving Corporation" means DD3 as surviving corporation of the Merger. Upon the Merger, DD3 became a wholly-owned subsidiary of Codere Online and its corporate name changed to "Codere Online U.S. Corp."

"Surviving Corporation Exchange" means the exchange in which each share of Merger Sub was converted into one share of the Surviving Corporation.

"TAM" means total addressable market.

"Transaction Documents" means the Business Combination Agreement, including all schedules and exhibits thereto and related disclosure schedules, the Ancillary Agreements and all other agreements, certificates and instruments executed and delivered by DD3, Codere Newco, Codere Online, Merger Sub or SEJO in connection with the Transactions and specifically contemplated by the Business Combination Agreement.

"Transactions" means the transactions contemplated by the Transaction Documents, including the Restructuring, the Exchange and the Merger.

"U.S. GAAP" means generally accepted accounting principles as in effect in the United States from time to time.

"Warrant Agreement" means the Original Warrant Agreement, as amended by the Warrant Amendment Agreement.

"Warrant Amendment Agreement" means that certain agreement to amend the Original Warrant Agreement entered into by DD3, Codere Online and Continental, as warrant agent, at Closing.

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**Presentation of Financial and Other Information**

In this annual report on Form 20-F (this "Form 20-F" or "annual report"), references to "Euro" and "€" are to the single currency adopted by participating member states of the European Union ("EU") relating to Economic and Monetary Union and references to "$", "US$" and "U.S. Dollars" are to the lawful currency of the United States of America.

The historical financial information for Codere Online has been prepared in accordance with IFRS, as issued by the IASB, which can differ in certain significant respects from U.S. GAAP.

Unless otherwise noted, all financial information for Codere Online provided in this annual report is denominated in Euros.

Our fiscal year ends on December 31 of each year. References to fiscal 2022 and 2022 are references to the fiscal year ended December 31, 2022, references to fiscal 2023 and 2023 are references to the fiscal year ended December 31, 2023, and references to fiscal 2024 and 2024 are references to the fiscal year ended December 31, 2024.

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**Preparation of the Annual Financial Statements**

Codere Online Luxembourg, S.A. was incorporated on June 4, 2021 and did not engage in any operations nor generate any revenues before the Exchange was completed on November 29, 2021. Codere Online's only activities until then were organizational activities and those necessary to prepare for the Business Combination.

As explained in greater detail in Notes 1 and 2 to the Annual Financial Statements beginning on page F-8 the Annual Financial Statements reflect the combination of the results of all of the entities and/or businesses that formed the Codere Online Business as of the Exchange Effective Time. Upon the consummation of the Exchange, the Codere Online Business was transferred to Codere Online except (i) as provided in the Business Combination Agreement with respect to Mexico, where Codere Online operates under an "Asociación en Participación" or "AenP" (an unincorporated joint venture) with LIFO (the entity which holds the LIFO License) as *asociante*, and SEJO as *asociado*, pursuant to which SEJO has the right to receive 99.99% of any distributed profits (see Item 7.B. "*Related Party Transactions*—*Material Agreements*—*AenP Agreement"*) and (ii) as indicated below with respect to Colombia, Panama and the City of Buenos Aires (Argentina). The transfer was structured in two steps: first, the transfer to SEJO of all the relevant entities and/or businesses that form the Codere Online Business that were not direct or indirect subsidiaries or businesses of SEJO as of the date of the Business Combination Agreement (as part of the Restructuring) and, secondly, the transfer of SEJO to Codere Online (as part of the Exchange).

In Spain and Italy, CDON and Codere Scommese S.r.l., respectively, were transferred to, and became wholly-owned subsidiaries of, SEJO, which became in turn a subsidiary of Codere Online upon consummation of the Exchange. In accordance with the Business Combination Agreement, as the planned corporate restructuring could not be consummated by October 1, 2021 with respect to Colombia, Panama and the City of Buenos Aires (Argentina), respectively, Restructuring Agreements were entered into on November 15, 2021 (except for the agreement that Codere Online Panama and ALTA entered into on December 1, 2021) between the relevant Codere Group entity holding the online license and a Codere Online entity. Such Restructuring Agreements generally governed the terms and conditions of, among other things, the assignment by the relevant Codere Group entity of assets, contracts, employees and permits, as applicable, necessary for the operation of the online gaming business by the Codere Online entity in Colombia, Panama and the City of Buenos Aires (Argentina), respectively, subject to the required authorizations. See Item 7.B. "*Related Party Transactions*—*Material Agreements.*"

The AenP Agreement in Mexico was entered into in June 2021 and is accounted for in Annual Financial Statements. Codere Online Panama and Codere Online Colombia S.A.S. were incorporated by Codere Online in Panama and Colombia, respectively, during 2021. Both are wholly-owned subsidiaries of Codere Online and are accounted for in the Annual Financial Statements. Codere Online Argentina, S.A. was incorporated in July 2022 and is accounted for in the audited consolidated carve-out financial statements of Codere Online as of and for the year ended December 31, 2022.

The financial statements as of and for the year ended 2022 are consolidated carve-out financial statements. They are considered "consolidated" financial statements because Codere Online controlled the relevant entities that comprise the Codere Online Business as of December 31, 2024, 2023 and 2022, except in Argentina, where Codere Online Argentina, S.A., a subsidiary of Codere Online, was not incorporated and registered until July 18, 2022. They are considered "carve-out" financial statements because the 2022 income statement and statement of cash flows includes carved-out results related to the online businesses of certain entities of the Codere Group. In 2021, these entities and/or businesses were transferred to, and became wholly owned subsidiaries of SEJO, which became in turn a subsidiary of Codere Online upon consummation of the Exchange, except as described herein with respect to (i) Colombia, Panama and the City of Buenos Aires (Argentina), where Restructuring Agreements were entered into, and (ii) Mexico, where Codere Online operates under an "Asociación en Participación" or "AenP", and except for the online business operations carved out from Iberargen, S.A. and presented in the relevant financial statements of Codere Group until the incorporation and registration of Codere Online Argentina, S.A. on July 18, 2022.

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The Restructuring was treated as a reorganization of entities under common control, which is outside of the scope of IFRS 3 (*Business Combinations*), as such entities were under the common control and management by the Codere Group. Accordingly, the Codere Group made an accounting policy choice to present business combinations under common control using the "predecessor accounting method" or "pooling of interest method", which involves the following:

● The assets and liabilities of the entities subject to the Restructuring were reflected at their carrying amounts in Codere Group's consolidated financial statements. No adjustments were made to reflect fair values, or recognize any new assets or liabilities at the Exchange Effective Time that would otherwise be done under the acquisition method.

● Any difference between the consideration paid/transferred and the aggregate book value of the assets and liabilities of the entities subject to the Restructuring as of the Exchange Effective Time was reflected as an adjustment to equity.

● The Annual Financial Statements include all revenues, expenses, assets and liabilities attributed to Codere Online as part of the Restructuring.

● Under the pooling of interest method, each of the entities subject to the Restructuring is accounted for as if it had always been part of Codere Online.

As explained in greater detail in Note 1 to the Annual Financial Statements, the Merger was completed on November 30, 2021 and DD3 became a part of Codere Online. Further, also on November 30, 2021 and in connection with the Merger, the DD3 Warrants were converted into warrants of Codere Online representing the right to purchase Ordinary Shares on substantially the same terms as were in effect immediately prior to the Merger Effective Time. The Merger was not considered a business combination under IFRS 3 (*Business Combinations*), but rather it was accounted for under IFRS 2 (*Share-based Payment*), as DD3 was not considered to be a business under IFRS 3. Therefore, the accounting of the Merger in the Annual Financial Statements is as follows:

● The equity of DD3 was eliminated and the equity of Codere Online stayed as the accounting acquirer.

● The difference in the fair value of certain of the securities of DD3 in excess of the fair value of the net assets of DD3 represented a service cost for the listing of Ordinary Shares, amounting to €35.8 million, which was accounted for as a share-based payment in accordance with IFRS 2.

● Therefore, the cost of the service, which is a non-cash expense, amounted to €35.8 million and was recorded within the listing and transaction costs line in 2021.

Transaction costs incurred in connection with the consummation of the Business Combination amounted to a total of €16.4 million, of which (i) DD3 incurred €6.8 million, which were accounted for as a reduction in cash and cash equivalents and a corresponding reduction in share premium of Codere Online in the consolidated carve-out financial statements of Codere Online for the year ended December 31, 2021 and (ii) SEJO incurred €9.6 million, of which €3.0 million were assumed by the Codere Group, and which were reflected as an increase in other operating expenses and as a combination of a reduction in cash and cash equivalents and an increase in share premium of Codere Online in the consolidated carve-out financial statements of Codere Online for the year ended December 31, 2021. For more information see Note 2 to the Annual Financial Statements beginning on page F-12.

The Annual Financial Statements reflect only part of Codere Online's proposed use of the proceeds of the Transactions, which seeks to enhance and expand its business and operations in the coming years, and of Codere Online's incremental operating expenses (e.g. due to the reinforcement of the management team and/or related to third-party service providers) needed to support such enhancement and expansion of the business and operation as an independent, Nasdaq-listed company. Consequently, the Annual Financial Statements may not be indicative of the results of operations and financial position of Codere Online. See Item 3.D. "*Risk Factors—Risk Factors Related to the Financial Information and this Annual Report—The Annual Financial Statements are not necessarily indicative of the results of operations and financial position of Codere Online*."

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**Intellectual Property**

We have proprietary rights or authorization to use certain trademarks, trade names and service marks used in this annual report that are important to our business, many of which are registered under applicable intellectual property laws. Solely for convenience, trademarks, trade names and service marks referred to in this annual report may appear without the "®" or "™" symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks, trade names and service marks. We do not intend our use or display of other companies' trademarks, trade names or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Each trademark, trade name or service mark of any other company appearing in this annual report is the property of its respective holder.

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**Industry and Market Information**

In this annual report, we present industry data, information and statistics regarding the markets in which Codere Online competes as well as Codere Online's analysis of statistics, data and other information provided by third parties relating to markets, market sizes, market shares, market positions and other industry data pertaining to Codere Online's business and markets. Such information is supplemented where necessary with Codere Online's own internal estimates, taking into account publicly available information about other industry participants and Codere Online's management's judgment where information is not publicly available. This information appears in Item 4 "*Information on the Company*", Item 5 "*Operating and Financial Review and Prospects*" and other sections of this annual report.

Industry publications, research, studies and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this annual report. These forecasts and forward-looking information are subject to uncertainty and risk due to a variety of factors, including those described under Item 3.D. "*Risk Factors*." These and other factors could cause results to differ materially from those expressed in any forecasts or estimates.

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**Cautionary Note Regarding Forward-Looking Statements**

Certain statements in this annual report may constitute "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding Codere Online's or its management team's expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this annual report may include, for example, statements about:

● Codere Online's financial performance and, in particular, the potential evolution and distribution of its net gaming revenue;

● any prospective financial information included in this annual report;

● changes in Codere Online's strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans;

● Codere Online's strategic advantages and the impact those advantages will have on future financial and operational results;

● expansion plans and opportunities, including TAM estimates;

● Codere Online's expectations with respect to obtaining and maintaining online gaming licenses;

● Codere Online's ability to grow its business in a cost-effective manner;

● the implementation, market acceptance and success of Codere Online's business model;

● developments and projections relating to Codere Online's competitors and industry;

● Codere Online's approach and goals with respect to technology;

● Codere Online's expectations regarding its ability to obtain and maintain intellectual property protection and not infringe on the rights of others;

● changes in foreign currency exchange rates, which can affect revenue and foreign currency prices;

● changes in applicable laws or regulations, including online gaming rules and regulations; and

● the outcome of any known and unknown litigation and regulatory proceedings.

These forward-looking statements are based on information available as of the date of this annual report, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing Codere Online's or its management team's views as of any subsequent date, and Codere Online does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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As a result of a number of known and unknown risks and uncertainties, Codere Online's actual results or performance may be materially different from those expressed or implied by these forward-looking statements. There may be additional risks that Codere Online does not presently know or that Codere Online currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. Some factors that could cause actual results to differ include:

● changes in applicable laws or regulations, including, among others, online gaming, anti-money laundering, artificial intelligence, data use and data protection rules and regulations as well as consumers' heightened expectations regarding proper safeguarding of their personal information;

● the ability to implement business plans, forecasts, and other expectations and identify and realize additional opportunities;

● Codere Online's expansion into new markets and geographies and the disposition, wind-down, liquidation or transformation of Codere Online's operations in any of the geographies where it operates from time to time;

● the risk of downturns and the possibility of rapid change in the highly competitive industry in which Codere Online operates;

● the risk that Codere Online and its current and future collaborators are unable to successfully develop and commercialize Codere Online's services, or experience significant delays in doing so;

● the risk that Codere Online may not be able to sustain profitability in the future;

● the risk that Codere Online will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all;

● the risk that Codere Online experiences difficulties in managing its growth and expanding operations;

● the risk that third-party providers, including the Codere Group, are not able to fully and timely meet their obligations;

● the risk that the online gaming operations will not provide the expected benefits due to, among other things, the inability to obtain or maintain online gaming licenses in the anticipated time frame or at all;

● the risk that Codere Online is unable to secure or protect its intellectual property;

● the risk that Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches.

● the possibility that Codere Online may be adversely affected by other political, economic, business, and/or competitive factors, including the ongoing Israel-Hamas war and its potential impact on our operations; and

● other risks and uncertainties described in this annual report, including those under Item 3.D. "*Risk Factors*."

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**PART I**

**Item 1. Identity of Directors, Senior Management and Advisers**

**A.** **Directors and Senior Management** 

Not applicable.

**B.** **Advisers** 

Not applicable.

**C.** **Auditors** 

Not applicable.

**Item 2. Offer Statistics and Expected Timetable**

**A.** **Offer statistics** 

Not applicable.

**B.** **Method and expected timetable** 

Not applicable.

**Item 3. Key Information**

**A.** **[Reserved]** 

**B.** **Capitalization and Indebtedness** 

Not applicable.

**C.** **Reasons for the Offer and Use of Proceeds** 

Not applicable.

**D.** **Risk Factors** 

*An investment in our securities involves a high degree of risk. In addition to the other information contained in this annual report, including the Annual Financial Statements included elsewhere in this annual report and the matters addressed under the heading "Cautionary Note Regarding Forward-Looking Statements," you should carefully consider the following risk factors before making and investment decision. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on Codere Online's business, reputation, revenue, financial condition, results of operations and future prospects, in which event the market price of our securities could decline, and you could lose part or all of your investment. Unless otherwise indicated, reference in this section and elsewhere in this annual report to Codere Online's business being adversely affected, negatively impacted or harmed will include an adverse effect on, or a negative impact or harm to, the business, reputation, revenue, results of operations, financial condition, and future prospects of Codere Online.*

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**Risk Factor Summary**

Set forth below is a summary of some of the principal risks we face:

***Risks Related to Codere Online***

● Codere Online's future performance may be significantly different from any prospective financial information published by Codere Online.

● The online gaming industry is subject to extensive regulation, including, among others, applicable direct and indirect taxation and anti-corruption, anti-money laundering, responsible gaming, economic sanctions, data protection and consumer data regulation, artificial intelligence and the failure to comply with such regulation could have a material adverse impact on Codere Online's business, results of operations and financial condition.

● Codere Online relies on licenses to conduct its operations, and the failure to renew existing licenses or obtain new licenses or the termination of such licenses could have a material adverse effect on its business.

● Codere Online has international business operations, including in emerging countries in Latin America, which subjects Codere Online to additional costs and risks.

● Codere Online may require additional capital to support its growth plans, and such capital may not be available on terms acceptable to Codere Online, or at all.

● Codere Online's success is dependent on maintaining and enhancing the "Codere" brand. Codere Online may be affected by actions undertaken, or failed to be undertaken, by Codere Newco and other members of the Codere Group.

● Codere Online is dependent on Codere Newco and certain of its subsidiaries to provide Codere Online with certain services, which may not be sufficient to meet Codere Online's needs.

● Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches.

● Codere Online relies on third-party providers to validate the identity and location of its users, and if such providers fail to accurately confirm user information, Codere Online's business, results of operations and financial condition could be adversely affected.

● Codere Online will continue to incur increased costs as a result of operating as a public company and its management will devote substantial time to existing and/or new compliance initiatives.

● Negative perceptions and negative publicity surrounding the gaming industry could damage Codere Online's reputation or lead to increased regulation or taxation.

● Codere Online may fail to detect money laundering or fraudulent activities by its customers or third parties and may be vulnerable to player fraud.

● Codere Online depends on the skill and experience of its management and key personnel. The loss of managers or key and highly qualified personnel, or an inability to attract such personnel, could adversely impact Codere Online's business.

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***Risks Related to the Financial Information and this Annual Report***

● Codere Online has identified a material weakness in its internal control over financial reporting. Failure to remediate this material weakness or additional material weaknesses in the future or otherwise failure to maintain an effective system of disclosure controls and procedures may have an adverse effect on the market price of the Ordinary Shares and Codere Online Warrants.

***Risks Related to the Business Combination***

● Changes in value of Codere Online Warrants could have a material effect on Codere Online's financial results.

● Codere Online may face litigation and other risks as a result of the Business Combination and related agreements.

***Other Risk Factors***

● Codere Online is controlled by Codere Newco and Codere Newco's interests may not be aligned with Codere Online's interests or the interests of other shareholders.

● A market for the Ordinary Shares and the Codere Online Warrants may not be sustained and the market price of such securities may be volatile.

● There can be no assurance that the Codere Online Warrants will be in the money at any time prior to their expiration and they may expire worthless.

● As long as Codere Online is a foreign private issuer, Codere Online is exempt from a number of U.S. securities laws and rules promulgated thereunder and is permitted to publicly disclose less information than U.S. public companies. This may limit the information available to holders of Codere Online's securities.

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**Risks Related to Codere Online**

***Codere Online's future performance may be significantly different from any prospective financial information published by Codere Online.***

Codere Online has made and continues to make on a yearly basis certain prospective financial information public. Such information includes Codere Online's estimated potential net gaming revenue and adjusted EBITDA. Such information is prepared in good faith by Codere Online's management based on certain estimates and assumptions at the time the prospective financial information is prepared. However, Codere Online's future performance may be significantly different from such information.

Further, such information is based on a number of assumptions and factors, many of which are outside Codere Online's control, including, but not limited to:

● Codere Online's ability to manage its growth;

● the ability to obtain, maintain or renew necessary regulatory authorizations, gaming licenses, approvals or findings of suitability (each, a "license");

● market size and demand for Codere Online's online gaming products and services and its ability to capture market share;

● the timing and costs of existing and new marketing and promotional efforts;

● competition, including from established and future competitors;

● Codere Online's ability to retain existing key management, to integrate recent hires and to attract, retain and motivate qualified personnel;

● changes in foreign currency exchange rates;

● the overall performance of the economies in the markets in which it operates or intends to operate in the future; and

● regulatory, legislative and political changes.

Unfavorable changes in any of these or other factors, many of which are beyond Codere Online's control, could materially and adversely affect its business, results of operations and financial condition and cause Codere Online's future performance to differ from the prospective financial information made public by Codere Online.

***Codere Online has only operated as an independent company since 2021.***

Codere Online Luxembourg, S.A. was incorporated on June 4, 2021 in connection with the spin-off of the online casino and online sports betting businesses of the Codere Group and Codere Online has only operated independently from the Codere Group as of the Merger Effective Time. Therefore, Codere Online has only been operating as an independent company for a relatively limited period of time.

You should consider Codere Online's business and prospects in light of the risks and significant challenges it faces as a relatively new independent company, including, among other things, with respect to its ability to:

● obtain, maintain and renew the necessary licenses in a timely and cost-effective manner;

● maintain and expand its customer base;

● successfully market its current and future products and services;

● properly price its products and services;

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● successfully service its customers and maintain customer goodwill;

● maintain and improve its operational efficiency;

● successfully operate and improve its technology platform and maintain a reliable, secure, high-performance and scalable technology infrastructure;

● predict its future revenues and appropriately budget for its expenses;

● attract, retain and motivate qualified personnel;

● anticipate trends that may emerge and affect its business;

● anticipate and adapt to changing market conditions, including technological developments and changes in competitive landscape;

● navigate an evolving and complex regulatory environment; and

● comply with applicable law, including, among others, anti-corruption, anti-money laundering, data protection and privacy and artificial intelligence regulations in any of the jurisdictions in which it operates.

If Codere Online fails to adequately address any or all of these risks and challenges, its business, results of operations and financial condition may be materially and adversely affected.

***Many of the markets in which Codere Online operates are still developing and, as a result, it may be difficult to evaluate future business prospects.***

Codere Online has operations in many continuously evolving online casino and online sports betting markets. Codere Online has been operating in Mexico since 2016, in Panama since 2018, in Colombia since 2019 and in Argentina since December 2021. Part of Codere Online's experience in these countries relates to a period in which the COVID-19 pandemic had a significant impact on economic, political and social conditions and such conditions may not be representative of future conditions. Moreover, it is possible that Codere Online's estimates of the TAM opportunities in its core and expansion markets are based on certain assumptions which may prove to be incorrect, and certain expansion markets may not open up through new regulatory frameworks and licensing regimes. The lack of development of any of these markets in which Codere Online operates in may hinder Codere Online's ability to successfully meet its objectives and make it difficult for potential investors to evaluate its business or prospective operations.

***The online gaming industry is subject to extensive regulation (including applicable direct and indirect taxation, anti-corruption, anti-money laundering and economic sanctions laws) as well as licensing requirements. Codere Online's business may be adversely affected if it is unable to comply with regulations or licensing requirements or any regulatory changes.***

Regulatory requirements applicable to the online gaming industry vary from jurisdiction to jurisdiction. Because of the broad geographical reach of Codere Online's operations, Codere Online is subject to a wide range of complex laws and regulations in the jurisdictions in which it operates. These regulations govern, for example, market access, advertisement, payouts, taxation, cash and anti-money laundering compliance procedures and other specific limitations, such as permissible forms of gaming and betting online. In addition to limiting the scope of Codere Online's permitted activities, these regulations may limit the number and configuration of the online gaming and betting activities it may undertake. Gaming authorities, governments or other regulatory bodies may deny, revoke or suspend Codere Online's licenses and impose fines or seize Codere Online's assets if it is found to be in violation of any of these regulations. If a license is required by a regulatory authority, and Codere Online fails to seek or does not obtain the necessary license, then Codere Online may be prohibited from providing its online products or services in the relevant jurisdiction. Codere Online may also experience delays from time to time in obtaining new licenses or renewing its existing licenses, which may result in disruptions to its business and the inability to provide its products or services. Upon the expiration of a license, a regulator could decide to offer that license to one or more third parties (through a competitive tender process or otherwise). In addition, it may issue additional licenses to third parties at any time. Obtaining or renewing a license may be costly and time consuming, and Codere Online's current licenses may not be renewed upon their expiration on favorable terms or at all. See "—*Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business*."

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Codere Online has implemented policies and procedures aimed at preventing and detecting violations of applicable laws and regulations, including but not limited to, gaming, anti-corruption and anti-money laundering and data protection laws and requirements. Despite Codere Online's efforts to update and maintain such policies and procedures, they may prove to be inadequate or insufficient and Codere Online may be exposed to potential allegations of inappropriate conduct in the future. Codere Online operates in certain countries and regions with a reputation for heightened corruption risk where it may face challenges or be unsuccessful in implementing and ensuring compliance with the policies and procedures aimed at preventing and detecting violations of applicable gaming, anti-fraud, anti-corruption, anti-money laundering and data protection laws and requirements.

In addition, changes in existing laws or regulations, or changes in their interpretation, including laws or regulations with a direct impact on the gaming industry, such as laws or regulations that prohibit money laundering and financing of terrorist and other unlawful financial activities as well as those focused on responsible gaming, could impact Codere Online's profitability and restrict its ability to operate its business. In addition, increasingly regulators, customers, investors, employees and other stakeholders are focusing on environmental, social and governance (ESG) matters and related disclosures. These changing rules, regulations and stakeholder expectations have resulted in, and are likely to continue to result in, increased general and administrative expenses and increased management time and attention spent complying with or meeting such regulations and expectations.

In recent years, changes in existing laws or regulations have had a significant impact on the online gaming industry. As an online gaming operator, Codere Online has experienced and may continue to experience increasing regulatory pressure in the form of advertisement restrictions, taxation increases, limitations on payment methods, licensing and sponsorship restrictions, or limitations on promotions, maximum bets or prizes, enhanced due diligence requirements and reporting obligations, among others.

For example, in Spain, online operators must pay a 20% tax on gross gaming revenue in addition to corporate income tax. This tax is reduced to 10% for those entities domiciled in the autonomous cities of Ceuta and Melilla, such as CDON, which is domiciled in Melilla. Players are required to declare any winnings over €1,600 and pay income tax on it. While there is a strict over-18 gambling policy, the Spanish government has taken several measures to reduce gaming advertising and exposure of online gaming to minors, prohibited players and players who show intensive or risky behaviour. Royal Decree 958/2020, of November 3, on the Commercial Communications of Gambling Activities (the "Advertising Decree"), introduced significant changes to the advertising framework of gaming companies in Spain, including, among others, a prohibition on sponsorships consisting of including gaming operator's brands on sports clubs' equipment and sports clubs' premises (such as stadiums). These restrictions have had a significant impact on the RM Sponsorship Agreement in Spain. On November 24, 2020, the RM Sponsorship Agreement was amended and terminated in respect of Spain only (without prejudice to the agreement remaining in force in the remaining applicable jurisdictions) at the end of the 2020/2021 football season due to newly-enacted advertising legal restrictions (which affect sponsorship) in Spain. In addition, advertising on television and on the Internet has been restricted to a four-hour window (from 1 a.m. to 5 a.m.). Notwithstanding the foregoing, on April 10, 2024, the Spanish Supreme Court issued a ruling on the appeal filed by JDigital (an iGaming operators' association in Spain) against the Advertising Decree in which several provisions have been declared null and void on legal/constitutional grounds. The immediate consequences of this ruling are: (i) operators may now offer promotions to attract new customers; (ii) commercial communications related to promotions are no longer restricted to existing players, they can be sent to any user who is legally entitled to receive this sort of communication; (iii) operators may use celebrities / famous persons in their advertising materials; (iv) operators may advertise themselves through digital channels; (v) operators are no longer required to send commercial communications just to certain categories of eligible users of social media platforms, and (vi) operators are no longer required to restrict sending commercial communications through social media profiles focused on gambling and apply other restrictions that were contemplated in that respect in the Advertising Decree.

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In the event an operator, like Codere Online, is undergoing sanctioning procedures or has received a sanction from the DGOJ in the past based on one or more of the voided provisions, it would be legally entitled to formally request the DGOJ to review its decision. It is still unclear what measures, if any, will be adopted by Codere Online or by other gaming operators in Spain in response to this ruling. There is a risk that the Spanish Government may decide to reintroduce the restrictions contemplated in the voided provisions of the Advertising Decree by approving them in a new piece of legislation.

In addition, in November 2022, Law 23/2022 was passed and amended the Spanish Gaming Law setting forth new advertising restrictions, limiting advertising during certain hours of the day and the issuance of welcome bonuses. Law 23/2022 also requires that commercial activity, including marketing, from gambling operators comply with certain principles of corporate social responsibility. As of August 5, 2023, the DGOJ has also reinforced due diligence and client verification requirements with respect to certain players and requires operators to communicate player de-registrations.

In recent years, the DGOJ has introduced strict requirements in the areas of player protection, fraud prevention and the promotion of responsible gaming. Royal Decree 176/2023 implementing safer gambling environments, effective as of March 15, 2024, introduced further measures to promote safer gambling environments with a particular focus on the protection of young players, prohibited players and players who show intensive or risky gambling behaviour. On June 22, 2024, the DGOJ published its resolution of June 6, 2024, approving a new data model updating data reporting obligations with the aim of harmonizing technical procedures with the current regulatory framework, especially following the entry into force of Royal Decree 176/2023 on safer gambling environments.

A draft Royal Decree is expected to be approved in or around June 2025 (effective a year later, in June 2026) introducing a system of joint deposit limits per player with respect to their activity with all online operators (a joint deposit limit per player of €600 per day and €1,500 per week) which the player will presumably have the ability to amend or delete in the DGOJ's portal. Generally, the DGOJ is increasing pressure on and scrutiny of operators with respect to due diligence requirements and reporting obligations.

Codere Online cannot be certain that laws, regulations or any authorities in the jurisdictions where it operates from time to time will not restrict Codere Online's gaming advertising or marketing activities or use and license under the Sponsorship and Services Agreement, the RM Sponsorship Agreements or any other sponsorship agreements, including any future sponsorship agreements under the Sponsorship and Services Agreement, or the rights of Codere Online's licensors under any such agreements. In addition, Codere Online cannot be certain that third-party services providers or contractors comply with any such laws or regulations in the jurisdictions where Codere Online or such third parties operate. For example, from time to time, Codere Online enters into agreements with third parties, such as affiliate marketers, whereby such third parties direct traffic to Codere Online's websites and platforms in exchange for a commission or other type of performance-based reward. Any failure or perceived failure by Codere Online or by such third parties to comply with applicable regulation, including by offering Codere Online's online gaming products in violation of advertising restrictions or in jurisdictions where any such offering would be prohibited, may damage Codere Online's reputation, result in sanctions and/or fines, adversely affect Codere Online's ability to obtain or renew licenses and to enter any potential strategic partnership, or otherwise materially and adversely affect Codere Online's business, results of operations and financial condition.

There can be no assurance that law enforcement or gaming regulatory authorities in the jurisdictions where Codere Online operates will not seek to restrict Codere Online's business in such jurisdictions or to initiate investigations which may result in sanctions or enforcement proceedings affecting Codere Online. In addition, there can be no assurance that any such restrictions or investigations, to the extent they result in sanctions or enforcement proceedings, will not have a material adverse impact on Codere Online's ability to retain and renew existing licenses or to obtain new licenses in such or other jurisdictions, or that they will not otherwise materially and adversely affect its business, results of operations and financial condition.

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In Spain, CDON has received and in the future may receive sanctions from the DGOJ and other authorities in connection with infringements of gaming regulations, which could individually or in the aggregate result in the imposition of civil and administrative penalties on Codere Online and could affect Codere Online's ability to renew any of its licenses, including the CDON Licenses, which, individually or in the aggregate, could have a material adverse effect on Codere Online's business, results of operations and financial condition. See "—*Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business*."

In Mexico, LIFO self-reported to the Mexican tax authorities ("SAT") 125 transactions between January 1, 2021 and August 31, 2021, within their respective statutory 30-day remedy period, involving player deposits that exceeded the required reporting thresholds and had not been duly reported under currently applicable Mexican anti-money laundering legislation. In addition, on September 8, 2021, LIFO self-reported to the SAT 264 additional transactions which had not been duly reported and were reported outside the statutory 30-day remedy period. Codere Online believes that this self-reporting may mitigate both the risk of being sanctioned and, if applicable, the amount of any sanction fees imposed. However, there is a risk that, in addition to any economic sanctions imposed by the SAT, which could be material, the Mexican gaming regulator, the *Secretaría de Gobernación* ("SEGOB") could impose additional sanctions on LIFO during the 5-year period following the sanction by the SAT, including a potential revocation of the LIFO License. There is also a risk that, because this self-reporting option can only be invoked once and LIFO already self-reported certain transactions outside the statutory remedy period in the past, SAT may determine that LIFO may not use this compliance through self-reporting option for the 264 additional self-reported transactions, and LIFO may be deemed a "repeat offender". If LIFO is considered a "repeat offender" for such reason or because, following the self-reporting of the 264 additional transactions, LIFO commits a similar or otherwise qualifying infraction within two (2) years, SEGOB could impose additional or more severe sanctions on LIFO including a potential revocation of the LIFO License. Although Codere Online has designed and implemented a risk-mitigation action plan in Mexico to address these risks and to ensure all transactions are duly and timely reported in the future, if LIFO is deemed an offender or a "repeat offender", significant economic sanctions could be imposed on LIFO and/or the LIFO License could be revoked, any of which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business.***

Codere Online is required to obtain, renew and maintain licenses in order to conduct its operations. Certain of Codere Online's licenses have in the past required (such as Panama and Colombia) or currently require (such as Mexico) that an operating retail presence be maintained. In addition, certain jurisdictions (such as Spain) require game-specific licenses in addition to a general license. As part of the Restructuring and Exchange (together with certain subsequent steps taken pursuant to the Restructuring Agreements), the Codere Group transferred to subsidiaries of Codere Online the licenses under which Codere Online operates in its core regions, except as indicated below with respect to Mexico and Panama. For additional information on Codere Online's licenses, see Item 4.B. "*Business Overview—Our Markets*."

In Mexico, Codere Online operates pursuant to a license, which is owned by LIFO (a wholly-owned subsidiary of the Codere Group). In such jurisdiction, Codere Online operates through an "Asociación en Participación" or "AenP" (an unincorporated joint venture) with LIFO under which Codere Online, through SEJO, operates online gaming and is entitled to receive 99.99% of any distributed profits whereas LIFO is entitled to receive the remaining 0.01% of any such distributed profits. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*AenP Agreement*" for additional information on the agreement with LIFO. As a result, in connection with its operations in Mexico, Codere Online is dependent on, among other factors outside of Codere Online's control, LIFO's good standing and maintenance of its license. If LIFO does not continue operating or otherwise does not maintain or renew the LIFO License, or if any disputes or disagreements arise between LIFO and Codere Online, Codere Online may be unable to continue operating in Mexico, which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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Further, gaming authorities may deny, revoke, suspend or refuse to renew any of Codere Online's licenses (references in this annual report to Codere Online's licenses shall be deemed to include the licenses owned by the Codere Group entities in Mexico and Panama referred to above) and impose fines or seize assets if Codere Online or its partners, licensees or clients were found to be in violation of any relevant regulations, any of which could have a material adverse effect on Codere Online's business, results of operations and financial condition. See "*—The online gaming industry is subject to extensive regulation (including applicable direct and indirect taxation, anti-corruption, anti-money laundering and economic sanctions laws) as well as licensing requirements. Codere Online's business may be adversely affected if it is unable to comply with regulations or licensing requirements or any regulatory changes*."

Codere Online may also have difficulty or face uncertainty in renewing its existing licenses or obtaining new ones, especially if the relevant regulations are unclear or change, or if new regulations are enacted. Codere Online intends to obtain new licenses and renew two of its licenses in the following years and it cannot assure that any of its licenses will be obtained or renewed, as applicable, or that they will be obtained or renewed on satisfactory terms or on a timely basis. Applications for new licenses and renewals of Codere Online's licenses, if approved, may be subject to certain delays, upfront application or renewal fees, canon tax surcharges or changes to national and regional regulations of the online gaming industry. Additional changes may occur in the future that may have an impact on Codere Online's ability to obtain or renew its licenses, such as changes in the license granting process (such as an open bidding process). Changes in national and regional authorities may also impact Codere Online's license obtainment or renewal processes, which may be subject to change from time to time. Consequently, there can be no assurance that Codere Online will be successful in obtaining new operating licenses or renewing its operating licenses, or that new potential economic terms of such new licenses or renewals will be reasonable or attractive to Codere Online, which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Furthermore, the licenses under which Codere Online operates may be revoked by regulatory authorities in certain circumstances, even if Codere Online is in compliance with all relevant obligations. For example, in Mexico, the SEGOB has complete and discretional authority regarding the granting, renewal, revocation or amendment of licenses. Specifically, a Presidential Decree amending the Regulations of the Federal Gaming Law in Mexico (the "Mexico Gaming Decree") came into effect on November 17, 2023 which, although it does not expressly refer to online gaming, may be deemed to apply to both retail and online gaming operations given that online permits are dependent on retail licenses in Mexico. Among other things, the Mexico Gaming Decree requires that any permit renewals must be limited to bingo and sports betting. On December 15, 2023, LIFO, together with other Codere Group permit holders, filed a claim against the Mexico Gaming Decree arguing that the sole publication of the Decree affects the grandfathered rights of the permit holders. LIFO's claim was admitted on December 19, 2023 by the Fourteenth Court on Administrative Matters in Mexico City. On November 21, 2024, the Sixteenth Court on Administrative Matters in Mexico City issued a resolution in LIFO's favour. This resolution was challenged by the Ministry of the Interior, and it is now pending resolution by a Court of Appeal. If the Codere Group is unsuccessful in its appeal, any renewed permits could be limited in scope relative to Codere Online's existing permits, and as a result, Codere Online's operations in Mexico could be materially adversely affected, which could have a material adverse effect on Codere Online's business, results of operation and financial condition. See Item 4.B. "*Business Overview—Regulation Applicable to Codere Online's Business."*

The CDON Licenses in Spain require that Codere Online establish the necessary systems, controls and procedures to ensure that it complies with applicable rules, laws and regulations in its Spanish operations. If the systems, controls and procedures adopted are not sufficient to comply with the applicable rules, laws and regulations, Codere Online could be deemed to have breached key terms of the CDON Licenses, which may result in sanctions or even the loss of the revocation of the CDON Licenses.

Moreover, an event of insolvency may constitute a breach of certain of Codere Online's licenses and result in their revocation. For example, in Mexico, the LIFO License, under which Codere Online operates, could be automatically revoked if LIFO were to file for insolvency protection. There can be no assurance that Codere Online would maintain or be able to renew its licenses in the event of insolvency or other financial difficulty, including upon the filing or declaration of insolvency of Codere Newco or Codere Group Topco S.A. (the parent company of the Codere Group), as such filing or declaration may be perceived to adversely affect the solvency of Codere Online as well.

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In Spain, online gaming is regulated at a state level and any operator who wants to operate online gaming in more than one region (*Comunidad Autónoma*) requires the DGOJ, the Spanish gaming regulator, to grant a general state license. Retail-based gaming activities are regulated on a regional (*Comunidad Autónoma*) basis. Under the Spanish sanctioning procedural law, a very serious ("*muy grave*") infringement could result in severe penalties, including revocation of licenses if such infringement involves egregious conduct and results in material adverse consequences and major damages to the market or players. Additionally, pursuant to the Spanish Gaming Law, a serious ("*grave*") infringement could be qualified as very serious ("*muy grave*") by the DGOJ if, within the two (2) years preceding the relevant sanction, the offender committed two (2) serious ("*grave*") infringements that are declared final or firm.

CDON received, and in the future may receive, sanctions from the DGOJ and other authorities in connection with potential infringements of gaming regulations. In 2023, CDON received two sanctions from the DGOJ of €125,000 each (reduced to €75,000 for prompt payment and assumption of liability) for breaches of regulatory obligations, including failing to prevent, for a period of 24 hours, the online gaming activities of one individual who was listed in the Spanish general register of gaming access bans. In 2024, CDON received a sanction from the DGOJ of €100,000 (reduced to €60,000 for prompt payment and assumption of liability) for a breach of the Advertising Decree, related to promotional material published on one of the CDON's social media platforms in 2022.

On May 12, 2025, CDON received a sanction from the DGOJ of €17,500 (reduced to €10,500 for prompt payment and assumption of liability) for three regulatory breaches related to infractions affecting player deposit limits.

Failure to obtain licenses or maintain and renew existing licenses as a result of the sanctions framework under the Spanish Gaming Law or otherwise, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Changes in taxation or the interpretation or application of tax laws could have a material adverse effect on Codere Online's business, results of operations and financial condition.***

The gaming industry is subject to significant taxation in most of the countries in which Codere Online operates. Taxes on gaming activities, including online games and online sports betting, may be established or increased or new and more exacting regulations may be enacted. These existing or new taxes may be in the form of gaming taxes on Codere Online's activity or indirect taxes on players (e.g., taxes on players' deposits or prizes).

In recent years certain gaming taxes have increased, and they may continue to increase, in the jurisdictions in which Codere Online operates. As gaming taxes imposed by regional or national authorities apply to a significant percentage of Codere Online's revenues, increases in gaming taxes may impact the profitability or possibility of being profitable of the affected operations and have a material adverse effect on its business, results of operations and financial condition.

Furthermore, some of Codere Online's licenses are subject to taxation upon renewal, and Codere Online cannot be certain of the amounts of future renewal fees or canon tax surcharges attributable to its licenses if and when its licenses are renewed. See "—*Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business*."

In February 2025, the Colombian President declared a state of internal commotion (state of emergency) and issued an executive decree, effective as of February 22, 2025 until December 31, 2025, introducing, among others: (i) a 19% VAT tax on all online deposits (equivalent to 16% of the deposit amount), and (ii) a 1% stamp duty on all private and public documents (including contracts) entered into on or after February 22, 2025 for (a) an undetermined amount, or (b) a value above COP 298,794. As of the date of this filing, this decree is undergoing an automatic review by the Constitutional Court of Colombia. If deemed constitutional, the 19% VAT and 1% stamp duty could remain in effect until December 31, 2025, which may adversely affect Codere Online's business in Colombia, results of operations and financial condition.

Any further increases in taxation, or the implementation of any new taxes to which Codere Online's operations may be subject, would increase its regulatory or tax compliance costs and could have a material adverse effect on its business, results of operations and financial condition.

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***Codere Online's failure to comply with regulations regarding the use of personal customer data could subject Codere Online to lawsuits or result in the loss of its customers' goodwill and affect its business, results of operations and financial condition.***

The actual and perceived integrity and security of an online gaming operation is critical to attracting gaming customers as Codere Online's reputation depends to a large extent on the trust it is able to generate among its customers and other stakeholders. Codere Online collects information relating to its customers and potential customers for various business purposes, including regulatory, marketing and promotional purposes. The collection and use of personal data are governed by privacy laws and other regulations enacted in the various jurisdictions in which Codere Online operates. The large amount of information and data that is processed throughout Codere Online increases the challenges of complying with data protection and privacy regulations. Compliance with applicable privacy regulations may increase Codere Online's operating costs and/or adversely impact its ability to market its products and services to its customers. Any failure or perceived failure by Codere Online to comply with applicable laws or satisfactorily protect personal information could result in governmental enforcement actions, litigation, or negative publicity, any of which could inhibit Codere Online's ability to grow its business. Moreover, there is a risk that measures adopted in response to these regulations may restrict Codere Online's marketing activities and innovation. Conversely, Codere Online's marketing activities and its efforts to promote innovation may result in increased compliance risks and costs.

Data privacy protection requires careful design of Codere Online's actions and services, as well as strong internal procedures and rules that are compliant with regulatory frameworks in each of the jurisdictions where Codere Online operates, as such frameworks may change from time to time and can be subject to new and differing interpretations by regulatory bodies, all of which entails compliance risk. Codere Online could suffer implementation delays, poor execution or breaches of applicable data protection and privacy regulations in any of the jurisdictions in which it operates. In addition, privacy regulations continue to evolve, as a result, implementation standards and enforcement practices are likely to continue evolving for the foreseeable future. Due to the uncertainty and potentially conflicting interpretations of these laws, it is possible that such laws and regulations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or Codere Online's practices.

In Spain, Codere Online is subject to Regulation (EU) 2016/679 of the European Parliament and of the Council of April 27, 2016, on the protection of natural persons with regard to the processing of personal data and on the free movement of such data ("General Data Protection Regulation" or "GDPR"). Codere Online is also subject to national laws adopting the GDPR and to national data protection and privacy laws applicable in non-EU member states. The GDPR contains, among other things, high accountability standards that Codere Online must comply with such as, among others, strict requirements for providing information notices to individuals, rules on international data transfers and outsourcing, mandatory data protection impact assessments of certain processing operations, maintenance of an internal data processing register, restrictions on the collection and use of sensitive personal data and mandatory notification of data security breaches. The GDPR imposes administrative fines for data protection compliance violations of up to the greater of €20 million or 4% of a company's global annual turnover.

Additionally, these laws and regulations apply not only to third-party transactions, but also to transfers of information among the entities and businesses that form Codere Online and other parties with which Codere Online has commercial relations. Codere Online is subject to laws and regulations regarding cross-border transfers of personal data, including laws relating to transfer of personal data outside of the European Economic Area ("EEA"). Codere Online relies on transfer mechanisms that it believes are permitted under these laws. Such mechanisms have received heightened regulatory and judicial scrutiny in recent years. If Codere Online cannot rely on existing mechanisms for transferring personal data from the EEA or other jurisdictions, because they are found not to be permitted under applicable law or otherwise, it could be prevented from transferring personal data of users or employees in those regions, limiting the transfer and processing of data and, in some cases, limiting Codere Online's activities in certain locations. In addition, if Codere Online does not comply with the provisions regarding transmission of customer data contained in the GDPR, Codere Online could face very significant sanctions. In this regard, since 2020 penalties for data protection violations have increased significantly, with fines in the millions of euros. This

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has increased the public's awareness of their privacy rights. As a result, if Codere Online failed to comply with the GDPR, it could result in fines or the loss of customer goodwill. Codere Online also shares personal data with third party services providers who process the data on our behalf. While Codere Online endeavours to ensure those processors understand their obligations under the GDPR and similar privacy laws, non-compliance by those processors could subject Codere Online to liability. Any failure to comply with regulations regarding the use of personal customer data could subject Codere Online to lawsuits or result in the loss of its customers' goodwill and materially affect its business, results of operations and financial condition.

***An outbreak of disease or similar public health threat could have a material adverse impact on Codere Online's business, results of operations and financial condition.***

An outbreak of disease or similar public health threat, or fear of such an event, could have a material adverse impact on Codere Online's business, results of operations and financial condition. In addition, outbreaks of disease could result in increased government restrictions and regulation, including quarantines of Codere Online's personnel, which could adversely affect its operations.

The COVID-19 pandemic resulted in, among other things, the suspension, shortening, delay or cancellation of sporting events and sports leagues which may occur again in the future and, as it happened in the past, Codere Online may not have an attractive and interesting online sports betting offer to sustain sufficient interest in its online sports betting products. Furthermore, shortened seasons for sports leagues may result in a smaller amount of wagers on sporting events throughout the course of each sport's season. On the other hand, closures or capacity limitations at gaming halls and other similar establishments, lockdowns and other measures imposed in light of the COVID-19 pandemic have resulted in a significant increase in the level of activity for online casinos. As the threat of the COVID-19 pandemic has diminished, and retail establishments have returned to operations at or near pre-pandemic levels, Codere Online faces increased competition from such retail operators. More generally, as other forms of entertainment that were unavailable, or available on a limited basis, during the COVID-19 pandemic, are able to resume their full operations, Codere Online faces increased competition for consumers' discretionary time and income from many more forms of entertainment that were unavailable, or available on a limited basis, during the COVID-19 pandemic. As a result, Codere Online's business, results of operations and financial condition could be adversely affected.

***Codere Online's business may be negatively impacted by volatility and other economic, market and political conditions in the markets in which it operates and in the locations in which its customers reside.***

Codere Online currently operates in Spain, Mexico, Colombia, Panama and Argentina. In the year ended December 31, 2024, Codere Online derived €95.7 million (or 47.7%) of its revenue from Mexico, €87.8 million (or 43.7%) of its revenue from Spain, €10.6 million (or 5.3%) of its revenue from Colombia and €3.5 million (or 1.7%) of its revenue from Argentina. In the year ended December 31, 2023, Codere Online derived €75.7 million (or 46.6%) of its revenue from Spain, €73.3 million (or 45.1%) of its revenue from Mexico, €9.3 million (or 5.7%) of its revenue from Colombia and €1.7 million (or 1.1%) of its revenue from Argentina.

Codere Online's business is, and is expected to continue to be, particularly sensitive to reductions in discretionary consumer spending, which is affected by general economic conditions and political conditions in the markets in which Codere Online conducts its operations. Economic contraction, which can eventually lead to an unstable job market, economic uncertainty and the perception by customers of weak or weakening economic conditions may cause a decline in demand for entertainment, including the online gaming products and services Codere Online offers. In addition, changes in discretionary consumer spending or consumer preferences could be driven by factors such as an unstable job market, changes in perceived or actual disposable consumer income and wealth or wars or fears of war and acts of terrorism. Codere Online's business, results of operations and financial conditions will be affected by economic conditions and volatility in the regions where it operates.

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In addition, Codere Online could experience negative impacts to its business, results of operations and financial condition as a result of geopolitical and other challenges and uncertainties globally. Currently, the world economy is facing several exceptional challenges, including declines in consumer confidence, declines in economic growth, increases in unemployment rates, high inflation rates, tariffs and interest rates and uncertainty about economic stability. Geopolitical and economic risks have further escalated in recent months due to trade tensions between the United States and several countries, including the E.U, as well as ongoing instability in Europe and political shifts in key global economies. Additionally, Russia's ongoing invasion of Ukraine has caused, and may continue to cause, significant disruption, instability and volatility in global markets, as well as higher inflation (including by contributing to further increases in the prices of energy, oil and other commodities and further disrupting supply chains) and lower or negative growth. The impact of sanctions and export controls that are being imposed or threatened against Russia and Russian interests, as well as potential responses to them by Russia, could significantly and adversely affect Codere Online's business, financial condition and results of operations, even though Codere Online's direct exposure to Ukraine and Russia is limited. Geopolitical and economic risks have also increased over the past few years as a result of trade tensions between the United States and China, Brexit, the rise of populism and tensions in the Middle East, including the ongoing Israel-Hamas war, to which we are particularly exposed given we currently have more than 40 employees in Israel. See "—*Security, political and economic instability in the Middle East may harm our business, including the duration and intensity of the ongoing Israel-Hamas War and its impact on our operations and workforce.*" Growing tensions may lead, among others, to a fragmentation and nationalization of the world economy, an increase in protectionism or barriers to immigration and foreign activity, a general reduction of international transactions and trade in goods and services and a reduction in the integration of financial markets, as well as the rise in frequency and sophistication of cyberattacks and a general loss of confidence in online transactions, any of which could materially and adversely affect Codere Online's business, results of operations and financial condition.

***Codere Online has international business operations, including in emerging countries in Latin America, which subjects Codere Online to additional costs and risks.***

A significant portion of Codere Online's operations are located in Latin America, particularly in Mexico, Colombia and Panama. In addition, Codere Online has been operating in the City of Buenos Aires (Argentina) since December 2021 and in the Province of Mendoza (Argentina), where Codere Online was awarded an online gaming license in April 2023 and began operating in 2024. Subject to, among other factors, adequate regulatory frameworks being enacted, Codere Online may also expand its business operations to other countries in the region, including Brazil, Chile, Peru, Puerto Rico, Uruguay and certain other regions of Argentina. As a result of its international operations, Codere Online is subject to a variety of risks and challenges in managing an organization operating in various countries, including, among others, those related to:

● general economic conditions in the countries in which Codere Online operates or intends to operate;

● regulatory changes;

● geopolitical events such as war;

● challenges caused by distance as well as language and cultural differences;

● public health risks;

● overlapping, changes in or onerous tax regimes;

● difficulties in transferring funds from certain countries; and

● reduced protection for intellectual property rights in some countries.

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Moreover, some or all of these risks may be exacerbated in the case of Codere Online's operations in emerging economies. Emerging economies may experience significant fluctuations in economic performance, geopolitical events such as war, social or labor unrest, acts of terrorism or other violence. In addition, operating in emerging markets may expose Codere Online to greater risks of loss due to expropriation, nationalization, confiscation of assets and property or the imposition of restrictions on foreign investments and repatriation of invested capital. Moreover, emerging market economies tend to have significantly higher corruption levels. Furthermore, Codere Online's Latin American operations expose Codere Online to currency risks as many Latin American countries have experienced significant recessions, inflation, unemployment and social unrest and their economies may be more volatile than the European markets in which Codere Online operates, leading to currency devaluation.

Any of the foregoing factors could materially and adversely affect Codere Online's business, results of operations and financial condition.

***Fluctuations in the exchange rates between Codere Online's operating currencies and the euro could adversely affect its results of operations.***

Codere Online's reporting currency is the euro. Fluctuations in the exchange rates of Codere Online's main non-euro operating currencies, mainly the U.S. dollar, the Mexican peso, the Colombian peso and the Argentine peso, could affect not only the economies of the relevant regions but also Codere Online's business, results of operations and financial condition. In particular, fluctuations in exchange rates may result in foreign exchange gains or losses for Codere Online. Codere Online is therefore exposed to the risks associated with the fluctuation of these currencies relative to the euro. See Note 16 to the Annual Financial Statements beginning on page F-49 and Item 5.E. "*Critical Accounting Policies and Estimates—Exchange rate risk"* for information on the impact of a 10% depreciation or appreciation of the euro against the main foreign currencies on Codere Online's Annual Financial Statements.

Any increase (decrease) in the value of the euro against any foreign currency of one of Codere Online's non-euro operating entities will cause Codere Online to experience unrealized foreign currency translation losses (or gains) with respect to amounts already invested in such foreign currencies. Accordingly, Codere Online may experience a negative impact on its income statement and balance sheet with respect to its holdings solely as a result of foreign currency conversion.

In 2024, the Mexican peso experienced significant depreciation, weakening by approximately 22.5%, from 17.6 MXN per EUR at the beginning of the year to 21.6 MXN per EUR by the end of December. This devaluation was driven by multiple factors, including the approval of constitutional reforms in Mexico and uncertainties surrounding the national elections.

Additionally, the prospect of new tariffs on Mexican, Colombian and Argentine imports by the United States in 2025 further pressured the Mexican peso, the Colombian peso and the Argentine peso, respectively, contributing to increased economic uncertainty and the currency's depreciation.

Although we may use in the future use, derivative financial instruments to hedge against some of our risk exposures arising from our obligations in foreign currencies, there can be no assurance that our hedging activities will effectively manage our foreign exchange risks. In particular, we may not fully hedge our positions in certain currencies and may not always obtain funding in all the currencies we require. Therefore, to the extent we are unable to hedge our position in a currency or is imperfectly hedged in respect of that currency, we may experience unrealized or realized losses. If we are not able to effectively anticipate and manage these risks, they may have a material adverse effect on our international operations or our business as a whole. During the years presented in this Annual Report, the Company did not use any such derivative financial instruments.

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***Codere Online may not be able to manage growth in its business effectively.***

Codere Online intends to leverage its operations in Spain and Mexico to expand its business in certain high-growth core Latin American markets (Colombia, Panama, Argentina), enter into new Latin American markets that have or are being regulated (Brazil, Peru and Puerto Rico) and others once they become regulated (Chile, Uruguay and other regions of Argentina), and explore options to access the large Hispanic market in the United States. As part of such expansion, Codere Online may make selective strategic investments, such as in strategic partnerships and acquisitions in the online gaming industry. Growth can place significant strain on Codere Online's management resources and financial and accounting control systems as it requires that management identify and execute upon appropriate investments and subsequently integrate, train and manage increased numbers of employees. Codere Online may not be able to implement and enhance effectively the operations, infrastructure, systems and processes required to undertake growth. Further, Codere Online may not be able to attract, integrate, train, motivate or retain additional highly-qualified personnel. Unprofitable investments or expansions or an inability to integrate or manage new investments or expansions could adversely affect Codere Online's business, results of operations and financial condition.

***Codere Online may require additional capital to support its growth plans, and such capital may not be available on terms acceptable to Codere Online, or at all. This could hamper Codere Online's growth and adversely affect its business.***

Codere Online intends to continue making significant investments to support its business operations and growth, including its expansion into new markets. Codere Online may require additional funds to respond to business challenges, expand into new markets or acquire complementary businesses. Accordingly, Codere Online may need to engage in equity or debt financings to secure additional funds. There is no assurance that, in the absence of additional funds, Codere Online will meet its potential expansion goals and priorities.

Codere Online's ability to obtain additional capital, if and when required, will depend on its business plan, investor demand, Codere Online's operating performance, capital markets conditions and other factors. If Codere Online raises additional funds by issuing equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of its currently issued and outstanding equity, and its existing shareholders may experience dilution. If Codere Online is unable to obtain additional capital when required, or on satisfactory terms, its ability to continue to support its business growth or to respond to business opportunities, challenges or unforeseen circumstances could be adversely affected, and Codere Online's business, results of operations and financial condition may be harmed.

***Codere Online operates in a highly competitive business environment and, as a result, its market share and business may be adversely affected by factors beyond its control.***

In many of the markets in which Codere Online operates, it faces competition from a number of large companies, as well as other smaller operators. In addition, companies with whom Codere Online competes may be larger than Codere Online or may have greater financial resources than Codere Online does, which could materially and adversely affect its revenues and profitability. Increased competition could have an adverse effect on Codere Online's ability to achieve and sustain profitability in the near future or at all and could impact future profit margins and cash flows. Furthermore, Codere Online faces and will continue to face competition from retail establishments, including those of the Codere Group for the discretionary spending of gaming customers, some of which divide their time between retail and online channels, as well as from certain other permitted online gaming and online sports betting activities that may be undertaken by the Codere Group under the Relationship and License Agreement. See "—*Codere Online may be affected by actions undertaken, or failed to be undertaken, by Codere Newco and other members of the Codere Group*" for additional information.

Existing technology, as well as proposed or undeveloped technologies, may become more popular in the future and render Codere Online's online products less profitable or even obsolete. In general, Codere Online's ability to compete effectively in the online gaming market will depend on the acceptance by its customers of the products and services it offers. Codere Online cannot assure that it will be able to successfully develop, offer and market appropriate gaming products and services, which could in turn have a material adverse effect on its business, results of operations and financial condition.

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Codere Online also faces competition from other existing and future public and private retail gaming establishments including gaming halls, slot route operators and, potentially, integrated destination resorts. Codere Online also competes, although to a limited extent, with lotteries, including national, regional and charitable ones. Moreover, Codere Online competes with illegal retail and online gaming activities, such as all forms of betting that circumvent public regulation, in particular, offshore gaming and operators that, as a result of their disregard of applicable regulations, may offer attractive pricing, promotions or other services. Such unregulated activities may drain significant portions of betting volumes away from the regulated industry. In particular, illegal betting could take away a portion of Codere Online's regular customers. If such forms of gaming are successful in attracting Codere Online's customers, its business, results of operations and financial condition could be materially adversely affected.

***Codere Online's success is dependent on maintaining and enhancing the "Codere" brand.***

Codere Online has a license from Codere Newco to operate under the "Codere" brand and Codere Online's success is dependent in part on its ability to leverage such brand. Codere Online's current and potential competitors may have greater name recognition and broader customer relationships and marketing resources than Codere Online does. In addition, as Codere Online does not own the "Codere" brand, even if it succeeds in its marketing efforts, the positioning of the "Codere" brand will depend primarily on the policies and success of the Codere Group.

In particular, any adverse change in the Codere Group's reputation could, in turn, adversely affect Codere Online's reputation. The Codere Group's inability to maintain, enhance or strengthen the "Codere" brand, or any actions by any member of the Codere Group or any of its employees that may negatively affect the "Codere" brand or Codere Online's reputation, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Furthermore, actions by members of the Codere Group or any of its employees may negatively affect the "Codere" brand, which would in turn negatively affect the confidence of Codere Online's clients, regulators or other parties and Codere Online's reputation. Negative public opinion could result from actual or alleged conduct by the Codere Group entities in any number of activities or circumstances, including, among others, operations, employment-related offenses such as sexual harassment and discrimination, regulatory compliance, the use and protection of data and systems, and the satisfaction of client expectations, and from actions taken by regulators or others in response to such conduct. Furthermore, actions by the former controlling shareholders of the Codere Group, including any legal actions brought against the Codere Group and/or Codere Online, may adversely affect the reputation of the Codere Group and/or Codere Online, divert the attention of management and key personnel, result in substantial expense, or otherwise materially and adversely affect Codere Online's business, results of operations and financial condition. See "—*Codere Online is and may be party to legal, administrative and arbitration proceedings, including tax and other disputes with regulatory authorities, and may become party to future litigation or disputes that may adversely affect its business*."

In addition, Codere Online may lose the right to use the "Codere" brand if the Relationship and License Agreement is terminated. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement.*" The Relationship and License Agreement may be terminated upon the occurrence of a change of control (described as the (direct or indirect) acquisition of the beneficial ownership of more than 50% of the share capital of Codere Online or SEJO by a non-affiliated third party or a group of non-affiliated third parties acting in concert with each other) or a sale of substantially all of the assets of Codere Online on a consolidated basis to a non-affiliated third party or a group of non-affiliated third parties acting in concert with each other, among other termination events, linked to the failure of either party to perform or observe any material term, obligation, condition or agreement contained in such Relationship and License Agreement. For the avoidance of doubt, neither Codere Online, nor Codere Newco nor one or more of Codere Newco's future or current affiliates, successors, assignees or any entity acquiring all of the assets and/or business of Codere Newco shall be deemed to be non-affiliated parties for the purposes of the application of such change of control clauses in the Relationship and License Agreement.

Pursuant to the Relationship and License Agreement, Codere Online may also not be able to use the "Codere" brand in certain jurisdictions where Codere Online operates from time to time if the use or the registration of the "Codere" brand or any related licensed marks is not legal or otherwise permitted under applicable laws in such jurisdiction or the "Codere" brand or any related licensed marks cannot be used or registered without unreasonable or unusual efforts. For more information, see Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement*." Developing a new brand would require a substantial investment of resources, and there is no guarantee that Codere Online would be successful operating under a new brand.

Any of the foregoing could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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***Codere Online may be affected by actions undertaken, or failed to be undertaken, by Codere Newco and other members of the Codere Group.***

Codere Online's business may be adversely affected if other members of the Codere Group compete with Codere Online. In order to address this risk, as part of the Relationship and License Agreement entered into by SEJO and Codere Newco, Codere Newco has undertaken, among other commitments, not to invest or operate online gaming businesses within the Territory, as defined therein, or to undertake any other Restricted Activity, as defined therein, subject to certain exceptions. However, Codere Newco is allowed to pursue any regulated gambling and gaming business and related services accessible exclusively through physical retail or other offline channels. Furthermore, Codere Newco may terminate the Relationship and License Agreement in certain circumstances. For additional information on the Relationship and License Agreement, see Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement.*" The Codere Group may elect to focus its investment and resources, including its marketing efforts, on its offline channels, which compete with Codere Online's business, adversely affecting Codere Online.

Furthermore, due to the existing relationship between Codere Online and the Codere Group, any actual or alleged actions undertaken, or failed to be undertaken, by members of the Codere Group or any of its employees that may affect the "Codere" brand, their licenses, their relationship with governments or regulators, their customers or otherwise affect their reputation, could materially and adversely affect Codere Online's business, results of operations and financial condition. See also "—*Codere Online's success is dependent on maintaining and enhancing the "Codere" brand*" and, with respect to how actions of members of the Codere Group could affect Codere Online's licenses, *"—Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business*."

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***Codere Online is dependent on Codere Group and certain of its subsidiaries to provide Codere Online with certain services, which may not be sufficient to meet Codere Online's needs, and Codere Online may have difficulty finding replacement services or be required to pay increased costs to replace these services to the extent that its services agreement with Codere Group terminates.***

Historically, Codere Group and certain of its subsidiaries have provided certain services related to certain business functions including, among other services, general management, management control, internal audit, communication, legal, financial management, human capital, corporate security support, platform services and corporate development. Since the consummation of the Business Combination, Codere Group has continued to provide some of these services under a Sponsorship and Services Agreement between Codere Online and Codere Group. Such services are provided by Codere Group either directly, through certain of its subsidiaries or through certain third-party services providers. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Sponsorship and Services Agreement.*"

In addition, under the New Platform and Technology Services Agreement, the Providers (as defined herein) currently provide certain platform and technology services to SEJO and CDON's online casino and online sports betting business, including personnel, customer support, internal trading personnel, technical assistance and technology, IT operations, security and cybersecurity, systems, communications, equipment, software licenses and trading services. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Platform and Technology Services Agreement.*"

While these services are being provided to Codere Online by Codere Group and certain of its subsidiaries, Codere Online will be dependent on them for services that are critical to Codere Online's operation (including, but not limited to, platform maintenance), and Codere Online's operational and financial flexibility to modify or implement changes with respect to such services may be limited. Codere Online currently relies, and for the foreseeable future expects to continue to rely, in substantial part on Codere Group and certain of its subsidiaries, as well as certain unrelated third-parties, to provide such services. If Codere Online is unable to effectively manage and control its outsourced activities or if the quality, accuracy or quantity of the services provided is compromised for any reason, Codere Online's ability to conduct its operations could be materially impacted and Codere Online's business, results of operations and financial condition could be adversely affected. In addition, service providers may store or have access to Codere Online's data and may not have effective controls, processes or practices to protect Codere Online's information from loss, unauthorized disclosure, unauthorized use or misappropriation or other cyberattacks or other disruptions to or breaches of information security. See "—*Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches.*"

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Should the Sponsorship and Services Agreement or the New Platform and Technology Services Agreement terminate, Codere Online may not be able to replace these services or enter into appropriate third-party agreements on terms and conditions, including cost and quality of service, comparable to those that Codere Online receives from Codere Group and the Providers under the Sponsorship and Services Agreement and the New Platform and Technology Services Agreement, respectively. Although Codere Online may in the future choose to replace fully or partially the services provided by Codere Group or the Providers, Codere Online may encounter difficulties replacing certain services or be unable to negotiate pricing or other terms as favorable as those Codere Online has or may in the future have in effect.

Codere Group has undergone several significant financial restructurings of its liabilities in recent years and completed a new recapitalization of approximately 90% of its debt on October 15, 2024. Although this recapitalization was aimed at achieving a stable capital structure and clean balance sheet for Codere Group, Codere Online cannot provide any assurances that additional restructurings will not occur in the future that may impact Codere Group's strategy, operations and/or ability to provide services to Codere Online or its performance of the related-party agreements (including the Sponsorship and Services Agreement, the Relationship and License Agreement, the Platform and Technology Services Agreement, the AenP Agreement or the Restructuring Agreements, on which Codere Online currently depends to conduct its business).

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***Codere Online's failure to keep up with technological developments in the online gaming market could negatively impact its business, results of operations and financial condition.***

The market for online gaming products and services is characterized by rapid technological developments, frequent new product and service offerings and evolving industry standards. The emerging character of these products and services and their evolution requires Codere Online to use technologies effectively and continue to improve the performance, features and reliability of its technology and information systems. The widespread adoption of new internet technologies or standards could require substantial expenditures to replace, upgrade, modify or adapt Codere Online's technologies and systems, which could negatively impact its business, results of operations and financial condition. Additionally, Codere Online depends on the provision of certain services by Codere Newco and certain of its subsidiaries, and their operational ability to keep up with any technological developments or to modify, enhance, develop or otherwise implement changes with respect to such services may be limited. See "—*Codere Online is dependent on Codere Group to provide Codere Online with certain services, which may not be sufficient to meet Codere Online's needs, and Codere Online may have difficulty finding replacement services or be required to pay increased costs to replace these services to the extent that its services agreement with Codere Newco terminates*." Further, Codere Online's failure to keep up with technological developments in the online gaming market could negatively impact its business, results of operations and financial condition.

***Codere Online uses artificial intelligence and related technologies within its business operations. Mishandling these technologies could lead to reputational damage, competitive setbacks, legal liabilities, regulatory sanctions and potentially impact our results of operations and financial condition.***

We currently use artificial intelligence (AI) and related technologies in our technology and infrastructure, with their significance in our operations expected to grow over time. However, our competitors or other third parties may adopt AI in similar or different ways, potentially outpacing us in speed or effectiveness, thus hindering our ability to compete and impacting our results of operations negatively. Furthermore, if AI-generated content, analyses, materials, or recommendations infringe upon or are alleged to infringe upon others' rights (including intellectual property rights) or are deemed illegal, we may face legal liabilities or experience adverse effects on our business, results of operations and financial condition. Moreover, the use of AI could lead to breaches of data security or privacy laws, or cybersecurity incidents compromising the personal data of customers, employees, or other third parties. Such violations or incidents associated with our AI usage could result in legal liabilities or damage our reputation and results of operations. Any controversies surrounding our AI implementation might cause brand or reputational harm or competitive disadvantages.

Additionally, the rapid advancements in AI, including compliance with existing and potential government regulations, may demand substantial resources for developing, testing, and maintaining platforms, offerings, services, and features to ensure compliance with the law and minimize adverse effects on our results of operations. For example, the European Union has passed the world's first comprehensive regulation on artificial intelligence (the "AI Act"), which was published on July 12, 2024. After entering into force on August 1, 2024, its enforcement follows a phased approach: within six months (February 2, 2025), regulations related to prohibited practices were implemented, and will be followed by obligations related to general-purpose AI models on August 2, 2025, and full enforcement of the AI Act after 24 months (August 2, 2026).

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The AI Act introduces a novel set of obligations and conditions for operating AI systems and models. These obligations vary and may impact Codere Online based on the type of AI utilized (systems or models), Codere Online's specific role concerning each AI, and the risk level associated with each system or model. Compliance with the AI Act will require monitoring and assessment of all AI systems and models operated by Codere Online to ensure adherence to prohibited practices and to identify all applicable obligations based on the aforementioned variables.

Furthermore, the AI Act will impose more stringent administrative penalties than those outlined in the GDPR, with fines potentially amounting to €35 million or 7% of a company's global annual revenue. In Spain, a dedicated regulatory body, the Spanish Agency for the Supervision of Artificial Intelligence (AESIA), has been established to oversee compliance with the AI Act. Unlike other EU member states, where national data protection authorities will also oversee AI compliance, this regulatory structure may result in having separate administrative procedures for the same business processes, particularly in instances where AI systems are involved in the processing of personal data. Furthermore, different fines may be imposed for AI Act violations and GDPR violations within the same business process, as determined by the respective authorities.

***Online games and products are subject to life cycles. Furthermore, changes in consumer preferences, popularity and social acceptance of gaming and sports betting could harm Codere Online's business.***

Based on Codere Online's net gaming revenue for the year ended December 31, 2024 (defined as all gross amounts wagered of Codere Online less: (i) player wins, (ii) player bonuses and (iii) promotional bets), approximately 41% of Codere Online's net gaming revenue is derived from its online sports betting offering, while approximately 59% derives from its online casino products (44% and 56% respectively, for the year ended December 31, 2023, and 50% each for the year ended December 31, 2022). Following their introduction, online games and products generally peak and then decline in popularity. The introduction of new online games and products or the modification of existing online games or products is important to the successful operation of Codere Online's business. Failure to introduce new online games or products or to modify existing online games or products and to retain or attract customers, as well as the introduction of new online games and products that prove to be unpopular, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Codere Online's business depends on the appeal of its offerings to customers. Codere Online's offerings compete with various other forms of online and retail gaming and sports betting. Changes in consumer preferences and any inability on Codere Online's part to anticipate and react to such changes, or the ability of Codere Online's competitors to adapt faster, could result in reduced demand for Codere Online's offerings and erosion of its competitive and financial position.

Online casino and sports betting competes, not only with traditional gaming and sports betting establishments, but also with other leisure activities as a form of consumer entertainment and may lose popularity as new leisure activities arise or as other leisure activities become more popular. The popularity and acceptance of online casino and sports betting is also influenced by prevailing social mores, and changes in social mores could result in reduced acceptance of gaming and sports betting as a leisure activity. To the extent that the popularity of gaming or sports betting declines as a result of any of these factors or otherwise, the demand for Codere Online's offerings may decline, which could have a material adverse effect on its business, results of operations and financial condition.

***Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches.***

The online casino and sports betting offering by Codere Online depends, to a great extent, on the reliability and security of Codere Online's information technology systems, software and network, which are subject to error, damage and interruption caused by human error, problems relating to telecommunications networks, software failure, natural disasters, sabotage, viruses and similar events. Any interruption in Codere Online's systems could have a negative effect on the quality of services offered, on consumer demand and, therefore, on the volume of sales, which in turn could have a material adverse effect on its business, results of operations and financial condition.

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Furthermore, Codere Online may be vulnerable to cyberattacks which could adversely affect its business. Cyberattacks are increasing in number and sophistication, are well-financed, in some cases supported by nation-state actors, and are designed to not only attack, but also to evade detection. Since the techniques used to obtain unauthorized access to systems, or to otherwise sabotage them, change frequently and are often not recognized until launched against a target, we and third parties associated with us may be unable to anticipate these techniques or to implement adequate preventative measures. In addition, certain global geo-political events can increase our cybersecurity risk. The costs to us to reduce the risk of or alleviate cybersecurity breaches and vulnerabilities could be significant.

Examples of cyberattacks include DDoS (distributed denial-of-service attacks, which are attacks designed to cause a network to be unavailable to its intended users) and other forms of cybercrime, such as attempts by computer hackers to gain access to Codere Online's systems and databases and system intrusions conducted for the purpose of stealing Codere Online's customers' personal information. Cyberattacks may cause system failures, business disruption or loss of data or funds and could have a material adverse effect on Codere Online's business, results of operations and financial condition. While Codere Online will continue to implement measures designed to prevent such attacks, they are, by nature, technologically sophisticated and may be difficult or impossible to detect and defend against. If Codere Online's prevention measures fail or are circumvented, Codere Online could suffer system failures, business disruption or loss of data or funds, which in turn could have a material adverse effect on its business, results of operations and financial condition. Additionally, certain Codere Online's employees work remotely from time to time, based on a hybrid work model, which creates a heightened risk that data could be misappropriated, lost or disclosed, or processed in breach of data protection regulations or cyberattacks or other disruptions to or breaches of our information technology systems.

Codere Online's accounting and reporting systems may also be subject to error, damage and interruption and may result in the unintended misreporting of financial information (see "*—Risk Factors Related to the Financial Information and this Annual Report— Codere Online has identified a material weakness in its internal control over financial reporting. If Codere Online is unable to remediate this material weakness, or if Codere Online identifies any material weaknesses in the future or otherwise fails to maintain an effective system of disclosure controls and procedures, including internal control over financial reporting, this may result in material misstatements of Codere Online's financial statements or cause Codere Online to fail to meet its periodic reporting obligations, which may have an adverse effect on the market price of the Ordinary Shares and Codere Online Warrants. Consequences may entail financial, regulatory, legal, and reputational repercussions"*). While Codere Online continues to develop internal controls and systems to anticipate such risks and increase the robustness of its accounting and reporting platform, there is no assurance that Codere Online's accounting systems will not be compromised in the future. Any such compromises could harm Codere Online's reputation and deter current or potential customers from using its services, which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Further, Codere Newco, certain of its subsidiaries and other third-party service providers may store or have access to Codere Online's data and may not have effective controls, processes or practices to protect Codere Online's information from loss, unauthorized disclosure, unauthorized use or misappropriation or other cyberattacks or other disruptions to or breaches of information security. A vulnerability in Codere Online's service providers' software or information technology systems, a failure of Codere Online's service providers' safeguards, policies or procedures, or a cyberattack or other disruption to or breach of information security affecting any of these service providers could irreparably damage Codere Online's reputation and business. The costs related to significant cyberattacks or other disruptions to or breaches of Codere Online's information technology systems could be material and cause Codere Online to incur significant expenses. If the information technology systems of third parties associated with Codere Online become subject to cyberattacks or other disruptions or security breaches, we may have insufficient recourse against such third parties and Codere Online may have to expend significant resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this nature from occurring. Any of the foregoing could irreparably damage Codere Online's reputation and business, which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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***The success, including the margin, of existing or future online casino and sports wagering products and services depends on a variety of factors and may experience significant volatility.***

Sports betting is a results driven industry. Pricing for each sports betting event is based on the statistical probability of each possible outcome happening. Codere Online's theoretical profit is dependent on the implied probabilities of each event. Over a long period of time, the statistical model is expected to correctly project the win/lose rates and to produce the expected theoretical profit. The actual short-term results, however, can significantly differ from the implied probabilities, therefore causing significant short-term volatility in Codere Online's margin (measured as net gaming revenue over gross amounts wagered). Additional factors causing margin volatility include the unequal distribution of the wagers compared to the implied probabilities, the skills and sports knowledge of customers, and the share of high-roller wagers. In addition, it is possible that Codere Online's platform erroneously posts odds or is otherwise misprogrammed to pay out odds that are favorable to bettors, and bettors place wagers before the odds are corrected. Additionally, odds compilers (including odds publishing platforms and web pages) and risk managers are capable of human error, so even if Codere Online's wagering products are subject to a capped payout, significant volatility can occur. For online casino, it is also possible that a random number generator outcome or game will malfunction and award errant prizes. As a result of the variability in these factors, the actual take rates (measured as customers' winnings as a percentage of total amounts wagered) on Codere Online's online casino and sports wagers may differ from the theoretical or projected take rates Codere Online has estimated and could result in the winnings of its customers exceeding those anticipated. The variability of take rates also has the potential to adversely affect Codere Online's business, results of operations and financial condition.

***Codere Online's current and future performance relies upon continued compatibility between its apps and the major mobile operating systems, third-party platforms continuing to allow distribution of its product offerings, high-bandwidth data capabilities and the interoperability of its platform with widely used mobile operating systems.***

Codere Online's users primarily access its online games and sports wagering product offerings through Codere Online's apps on their mobile devices, and Codere Online believes that this will continue to be the case going forward. To provide Codere Online's users its product offerings through its apps on their mobile devices, Codere Online's apps must be compatible with major mobile operating systems. Codere Online's apps relies upon third-party platforms to distribute its product offerings, interoperability of its platform with popular mobile operating systems, technologies, networks and standards and continued high-bandwidth data capabilities. Third parties with whom Codere Online does not have any formal relationships control the design of mobile devices and operating systems. These parties frequently introduce new devices, and from time to time they may introduce new operating systems or modify existing ones. Network carriers may also impact the ability to download apps or access specified content on mobile devices. Furthermore, Codere Online's apps relies upon third-party platforms for distribution of its product offerings. Codere Online's games and online sports wagering product offerings are also distributed through certain websites (Codere.es, Codere.mx, Codere.co, Codere.pa, Codere.bet.ar), the Apple App Store and the Google Play store.

The promotion, distribution and operation of Codere Online's apps are subject to the respective distribution platforms' standard terms and policies for application developers, which are very broad and subject to frequent changes and interpretation and may not be uniformly enforced across all applications and geographies and with all publishers. Moreover, Codere Online is, and will continue to be, dependent on the interoperability of its platform with popular mobile operating systems, technologies, networks, and standards that it does not control, such as the Android and iOS operating systems. Any changes, bugs, technical, or regulatory issues in such systems, Codere Online's relationships with mobile manufacturers and carriers, or in their terms of service or policies that negatively affect its offerings' functionality, reduce or eliminate Codere Online's ability to distribute its offerings, provide preferential treatment to competitive products, limit Codere Online's ability to deliver its offerings, or impose fees or other charges related to delivering its offerings, could adversely affect Codere Online's product usage and monetization on mobile devices.

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In addition, Codere Online's products require high-bandwidth data capabilities for placement of time-sensitive wagers. If high-bandwidth capabilities do not continue to grow or grow more slowly than generally anticipated, particularly for mobile devices, Codere Online's user growth, retention, and engagement may be negatively impacted. To deliver high-quality content over mobile cellular networks, Codere Online's product offerings also must work well with a range of mobile technologies, systems, networks, regulations, and standards that Codere Online does not control. In particular, any future changes to the iOS or Android operating systems (which likely will occur) may impact the accessibility, speed, functionality, and other performance aspects of Codere Online's platform. In addition, the adoption of any laws or regulations that adversely affect the growth, popularity, or use of the Internet, including laws governing Internet neutrality, could decrease the demand for Codere Online's products and increase its cost of doing business. Specifically, any laws that would allow mobile providers to impede access to content, or otherwise discriminate against content providers like Codere Online over their data networks, could have a material adverse effect on its business, results of operations and financial condition.

Furthermore, if it becomes more difficult for Codere Online's users to access and use its platform on their mobile devices, if Codere Online's users may choose not to access or use its platform on their mobile devices, or if Codere Online's users choose to use mobile products that do not offer access to its platform, Codere Online's user growth, retention, and engagement could be materially harmed. Additionally, if any of the third-party platforms used for distribution of Codere Online's product offerings were to limit or disallow advertising on their platforms or technologies were developed that block the display of Codere Online's ads, Codere Online's ability to generate revenue could be negatively impacted. These changes could materially impact Codere Online's business activities and practices, and if Codere Online or its advertising partners are unable to timely and effectively adjust to those changes, there could be an adverse effect on Codere Online's business, results of operations and financial condition.

***If Internet and other technology-based service providers experience service interruptions, Codere Online's ability to conduct its business may be impaired.***

A substantial portion of Codere Online's network infrastructure is provided by third parties, including Internet service providers and other technology-based service providers. If Internet service providers experience service interruptions of any kind, communications over the Internet may be interrupted and impair Codere Online's ability to conduct its business. Internet service providers and other technology-based service providers may in the future roll out upgraded or new mobile or other telecommunications services, such as 5G or 6G services, which may not be successful and thus may impact the ability of Codere Online's users to access its platform or product offerings in a timely fashion or at all. There can be no assurance that the Internet infrastructure or Codere Online's own network systems will continue to be able to meet the demand placed on it by the continued growth of the Internet, the overall online gaming industry and Codere Online's users. Any difficulties Internet service providers and other technology-based service providers face, as well as certain decisions that such providers may take (on which Codere Online exercises no control), including if certain network traffic receives priority over other traffic (*i.e*., lack of net neutrality), may adversely affect Codere Online's business. Any system failure as a result of reliance on third parties, such as network, software or hardware failure, including as a result of cyberattacks, which causes a loss of Codere Online's users' property or personal information or a delay or interruption in Codere Online's product offerings, including its ability to handle existing or increased traffic, could result in a loss of anticipated revenue, interruptions to Codere Online's platform and product offerings, cause Codere Online to incur significant legal, remediation and notification costs, degrade the customer experience and cause users to lose confidence in Codere Online's product offerings, any of which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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***Codere Online relies on third-party providers to validate the identity and location of its users, and if such providers fail to accurately confirm user information, Codere Online's business, results of operations and financial condition could be adversely affected.***

Codere Online cannot guarantee that the third-party geolocation and identity verification systems that it relies on will work effectively. Codere Online relies on these geolocation and identity verification systems to ensure it follows applicable laws and regulations and offers its products and services only in jurisdictions where it is allowed to and to customers who can legally use them. Any service disruption to those systems could prevent Codere Online from ensuring compliance with legal requirements. Additionally, incorrect or misleading geolocation and identity verification data with respect to current or potential users received from third-party service providers may result in Codere Online inadvertently allowing access to its offerings to individuals who are not permitted to access them, or otherwise inadvertently deny access to individuals who are permitted to access them, in each case based on inaccurate identity or geographic location determinations. Codere Online's third-party geolocation services providers rely on their ability to obtain information necessary to determine geolocation from mobile devices, operating systems, and other sources. Changes, disruptions or temporary or permanent failure to access such sources by Codere Online's third-party service providers may result in their inability to accurately determine the location of Codere Online's users. Moreover, failure to maintain Codere Online's existing contracts with third-party service providers, or to replace them, may result in Codere Online's inability to access geolocation and identity verification data necessary for Codere Online's operations. If any of these risks materializes, Codere Online may be subject to disciplinary action, fines, lawsuits, and Codere Online's business, results of operations and financial condition could be adversely affected.

***Codere Online's platforms contain third-party open source software components, and failure to comply with the terms of the underlying open source software licenses could restrict Codere Online's ability to provide its offerings.***

Codere Online's platforms (certain of which are provided by the Codere Group) contain software modules licensed by third-party authors under "open source" licenses. The usage and distribution of open source software may entail greater risks than that of third-party commercial software, as open source licensors generally do not provide support, warranties, indemnification or other contractual protections regarding infringement claims or the quality of the software. In addition, the public availability of such software may make it easier for others to compromise Codere Online's platforms.

In the past, there have been claims challenging the ownership of open source software against companies that incorporate open source software into their solutions. As such, Codere Online could be subject to lawsuits by parties claiming infringement of intellectual property rights in what Codere Online believes to be open source software. If Codere Online is held to have breached or failed to fully comply with all the terms and conditions of an open source software license, Codere Online could face infringement or other liability, or be required to seek costly licenses from third parties to continue providing its offerings on terms that are not economically feasible, to re-engineer Codere Online's platforms, to discontinue or delay the provision of its offerings if re-engineering could not be accomplished on a timely basis or to make proprietary source code generally available, any of which could adversely affect its business, results of operations and financial condition.

***Negative perceptions and negative publicity surrounding the gaming industry could damage Codere Online's reputation or lead to increased regulation or taxation.***

The gaming industry may be, and has been from time to time, perceived as an industry involved in political corruption, organized crime, money laundering, tax evasion and other criminal activities and most gaming companies, including Codere Online, face allegations from time to time relating to their and their partners' involvement in illegal activities.

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In addition, the gaming industry is exposed to negative publicity and attention generated by a variety of sources, including citizens' groups, non-governmental organizations, media sources, local authorities, and other groups and institutions. In particular, in recent years, public attention has been drawn to findings or allegations of illegal betting and gaming, participation or alleged participation in gaming activities by minors, risks related to social issues such as addiction to online gaming and risks related to data protection and payment security. In addition, publicity regarding social issues related to the gaming industry, even if not directly connected to Codere Online or its business, could adversely impact Codere Online's business, results of operations and financial condition. If the perception develops that the gaming industry is failing to address such concerns adequately, any accompanying political pressure may result in the gaming industry becoming subject to increased regulation, taxation, limitations on advertising or certain additional controls or restrictions to Codere Online's operations. Future changes in regulation or taxation could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Corruption, bribery and money-laundering are among the risks Codere Online faces in the course of its activity. Despite Codere Online's efforts, it may fail to prevent irregular conduct and may face allegations regarding involvement in illegal activities. Further, Codere Online cannot assure that negative public perception toward gaming will not give rise to increased governmental scrutiny of its business or allegations of misconduct or illegal activity concerning it or its partners, or potential increased obligations and controls, any of which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Furthermore, in order to build and maintain its business, Codere Online must maintain the confidence of its customers, suppliers, analysts and other parties in its products and services, long-term financial viability and business prospects. Maintaining such confidence may be particularly challenging due to the negative perceptions surrounding the gaming industry and other factors largely outside of Codere Online's control. If Codere Online were to lose the confidence of customers, suppliers, analysts or other parties, this could have a material adverse effect on Codere Online's business, results of operations and financial condition. Furthermore, any actions by members of the Codere Group or any of its employees that may negatively affect the "Codere" brand or Codere Online's reputation could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Codere Online is dependent upon its ability to provide secure online gaming products and to maintain the integrity of its employees and its reputation.***

The integrity and security of online gaming operations are critical factors to attract and retain customers. Codere Online strives to set exacting standards of personal integrity for its employees and security for the online gaming systems that it provides to its customers. Codere Online's reputation in this regard is an important factor in its business dealings with governmental authorities. For this reason, an allegation or a finding of illegal or improper conduct on Codere Online's part, or on the part of one or more of its current or former employees, or an actual or alleged system security defect or failure, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Codere Online may fail to detect money laundering or fraudulent activities by its customers or third parties.***

Codere Online is exposed to the risk of money laundering and fraudulent activities by its customers and third parties, including collusion between online customers and the use of sophisticated computer programs that automatically play skill games in its online gaming platform. Codere Online may also be exposed to money laundering attempts arising from an inability or failure to identify the origin of funds of deposits made into customer accounts. In connection with Codere Online's online betting activities, Codere Online has implemented internal control systems that monitor unusual transaction volumes or patterns and screen the personal details of the customer in order to minimize exposure to money laundering and fraud. Codere Online may not, however, be successful in protecting its customers and itself from such activities. In addition, Codere Online could be targeted by third parties, including criminal organizations, for committing fraudulent activities, such as attempts to compromise its system that processes and collects payment information, or attempts to use its betting services to engage in money laundering. See also "—*Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches.*"

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Codere Online's network partners are required to abide by applicable laws, including those related to identifying the customers placing bets. Although Codere Online has controls in place, it may fail to detect non-compliance with applicable laws or with its policies by it or its Codere Online's network partners. To the extent Codere Online is not successful in protecting its customers or itself from money laundering and fraudulent activities, Codere Online could be subject to criminal sanctions and administrative fines and could directly suffer losses or lose the confidence of its customer base, which could have a material adverse effect on its business, results of operations and financial condition. Codere Online's failure to comply with such provisions could result in the imposition of criminal sanctions and/or fines on its directors, other penalties, revocation of concessions and licenses or operational bans, which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

In addition, under Spanish law, Codere Online can be held criminally liable if a number of requirements established in the Spanish Criminal Code are met, in particular, it is required that: (i) the criminal activity is carried out by a person acting on behalf of the company (such as its legal representatives, directors, agents, etc.) or by an employee; (ii) there is a failure by the company to observe its supervisory and control duties over its representatives (which shall be determined on a case by case basis taking into account all relevant circumstances); and (iii) the company benefits directly or indirectly from the aforementioned criminal activity. Any violations of Decree 231 and Article 31 bis of the Spanish Criminal Code could result in the imposition of fines and/or operational bans, and/or the revocation of concessions and licenses, and therefore could have a material adverse effect on Codere Online's business, financial condition and results of operations. In particular, anti-money laundering laws and regulations require, among other requirements, that certain subsidiaries adopt and implement control policies and procedures which involve "know your customer" principles that comply with the applicable regulations (for customers and providers) and the reporting of suspicious or unusual transactions to the applicable regulatory authorities. While Codere Online has adopted policies and procedures intended to detect and prevent the use of Codere Online's network for money laundering activities and by terrorists, terrorist organizations and other types of criminal organizations, those policies and procedures may fail to eliminate the risk that Codere Online's network is used by other parties, without its knowledge, to engage in activities related to money laundering or other illegal activities. To the extent that Codere Online fails to detect money laundering or fraudulent activities by its customers or third parties, it could be subject to fines and other penalties by the relevant authorities. Codere Online cannot guarantee that relevant governmental agencies will not impose penalties or that such penalties will not adversely affect its business, results of operations and financial condition. Furthermore, illegal gaming may drain significant portions of gaming volume away from the regulated industry and adversely affect Codere Online's business. See "—*Codere Online operates in a highly competitive business environment and, as a result, its market share and business may be adversely affected by factors beyond its control*."

***Codere Online may be vulnerable to player fraud.***

The online gaming industry is vulnerable to attacks by customers through collusion and fraud. Although Codere Online takes steps to minimize the opportunities for fraudulent play, Codere Online can provide no assurance that all instances of collusion and fraud will be detected. If Codere Online fails to detect instances of collusion and fraud either between players or between players and Codere Online's employees or agents, it could suffer losses directly as a result of such collusion and fraud instances. For example, a fraud resulting in misappropriation of funds was committed against Codere Online in Spain related to a series of fraudulent withdrawals over a four-month period, from April to July 2023, totalling €0.5 million made by an online customer from his online account at a third-party retail gaming hall located in Cádiz, Andalucía. The online customer's account was frozen on July 25, 2023. Codere Online filed a police report on August 1, 2023, and the investigation is ongoing, including with respect to recovery of the misappropriated funds. The Provincial Court of Cádiz has scheduled a preliminary hearing for June 5, 2025, to determine the stance of the parties involved and suggest the evidence to be presented at the subsequent criminal trial to be held at a date yet to be determined.

Negative publicity about potential fraud and corruption in sports events (including collusion and match-fixing), even if not directly or indirectly connected with Codere Online or its services, may adversely impact Codere Online's reputation and the willingness of the public to participate in sports betting. As a result, the number of potential users available to Codere Online could be adversely affected. Further, Codere Online's customers participating in those games or bets subject to collusion or fraud could also suffer losses and may become dissatisfied with Codere Online's products. Any of the foregoing could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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Further, Codere Online has been affected and may, in the future, continue to be affected by cases of identity theft and fraud. In fraud cases the offender is typically a third party who commits identity theft and opens a Codere player account under a false identity into which the fraud victim is instructed by the offender to deposit certain amounts, which the offender thereafter withdraws via ATMs without the victim's consent. Other fraud cases involve identity theft or the creation of simulated customer accounts to benefit from Codere Online's commercial promotions and marketing efforts. As of the date of this annual report, amounts involved in identified fraud cases have not been material. However, any such fraud cases could result in the imposition of civil and criminal penalties and sanctions on Codere Online and could affect Codere Online's ability to renew any of its licenses, including the CDON Licenses, which, individually or in the aggregate, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Increases in the amount or frequency of fraud or other types of misuse of Codere Online's products and services could have reputational impact for Codere Online and could diminish customer confidence in Codere Online and its products and services, which could result in unfavorable media coverage or publicity and in the imposition of further regulatory restrictions on Codere Online or on the online gaming industry in general. Any of the foregoing factors could materially and adversely affect Codere Online's business, results of operations and financial condition.

***Codere Online's intellectual property could be subject to infringement or misappropriation by third parties or claims of infringement of rights or misappropriation by third parties.***

Codere Online's intellectual property portfolio consists substantially of licensed intellectual property, including the "Codere" trademarks licensed pursuant to the Relationship and License Agreement, which agreement is described in Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement*." Codere Online relies on a combination of copyright and trademark laws, trade secret protection, confidentiality and non-disclosure agreements and other contractual provisions in order to protect its intellectual property. There can be no assurance that these efforts will be adequate, or that third parties will not infringe upon or misappropriate Codere Online's proprietary rights, which could harm its business and competitive position. For example, consultants, vendors, former employees and current employees may breach their obligations regarding non-disclosure and restrictions on use of its intellectual property. In addition, intellectual property laws in Latin America and other jurisdictions may provide differing and limited protection, may not permit Codere Online to gain or maintain a competitive advantage and may not prevent Codere Online's competitors from replicating its products or gaining access to its proprietary or licensed information and technology. Codere Online may also be subject to claims of infringement of the rights of others or party to claims to determine the scope and validity of the intellectual property rights of others. Such claims, whether valid or not, could require Codere Online to spend significant resources in litigation, pay damages, rebrand or re-engineer services, acquire licenses to third-party intellectual property and distract management's attention away from the business, all of which may have a material adverse effect on Codere Online's business, results of operations and financial condition.

In addition, Codere Online has acquired licenses to intellectual property rights from third parties, including from Codere Newco under the Relationship and License Agreement and the Sponsorship and Services Agreement (see Item 7.B. "*Related Party Transactions*—*Material Agreements*"). If such third parties do not properly maintain or enforce the intellectual property rights subject to such licenses, or if such licenses are terminated, Codere Online could lose the right to use the licensed intellectual property, which could adversely affect Codere Online's competitive position or its ability to commercialize certain of its technologies, products or services, any of which could have a material adverse effect on Codere Online's business, results of operations and financial condition.

In addition, Codere Online may not be able to use the "Codere" brand, other licensed intellectual property or its own intellectual property in certain jurisdictions where Codere Online operates if the use or the registration of any such intellectual property is not legal or otherwise permitted under applicable laws in such jurisdiction or any such intellectual property cannot be used or registered without unreasonable or unusual efforts. See "—*Codere Online's success is dependent on maintaining and enhancing the "Codere" brand*."

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***Codere Online is and may be party to legal, administrative and arbitration proceedings, including tax and other disputes with regulatory authorities, and may become party to future litigation or disputes that may adversely affect its business.***

Due to the nature of its business, Codere Online is and may be subject to a number of legal, administrative and arbitration proceedings from time to time, including tax and other disputes with regulatory authorities, and has been and could become involved in legal, administrative and arbitration proceedings or investigations by government authorities from time to time. See "—*The online gaming industry is subject to extensive regulation (including applicable direct and indirect taxation, anti-corruption, anti-money laundering and economic sanctions laws) as well as licensing requirements. Codere Online's business may be adversely affected if it is unable to comply with regulations or licensing requirements or any regulatory changes.*" Codere Online cannot assure that any investigation will not affect it or that it will prevail in any current and/or future proceedings or disputes, and any such investigation or adverse resolution of any such proceeding or dispute could have a material adverse effect on its business, results of operations and financial condition. Further, we could be required to change or halt our activities pending the resolution of, or as a result of, any such investigation, proceeding or dispute.

***Codere Online will continue to incur increased costs as a result of operating as a public company and its management will devote substantial time to existing or new compliance initiatives.***

Codere Online became a public company in the last quarter of 2021 and has incurred significant legal, accounting and other expenses that it did not incur as a private company, and these expenses may increase even more after Codere Online is no longer an emerging growth company, as defined in Section 2(a) of the Securities Act. As a public company, Codere Online is subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and Nasdaq. Further, Codere Online is subject to the U.S. Foreign Corrupt Practices Act ("FCPA"). The anti-bribery provisions of the FCPA prohibit providing or promising to provide anything of value to a foreign official to gain an improper business advantage and they impose derivative liability on companies for the actions of its employees and for any third party acting on the company's behalf, as well as individuals involved in or authorizing such conduct. Codere Online's management and other personnel need to devote a substantial amount of time to new compliance initiatives. Moreover, Codere Online expects these rules and regulations to substantially increase its legal and financial compliance costs and to make some activities more time consuming and costly. These rules and regulations, together with the nature of Codere Online's business, make it difficult and expensive for Codere Online to obtain and maintain director and officer liability insurance from third-party insurers. As a result, in the future, Codere Online may need to self-insure its directors and officers or may otherwise be required to accept policy limits or incur substantially higher costs to obtain coverage from third-party insurers. The impact of these requirements could also make it more difficult for Codere Online to attract and retain qualified persons to serve on the Codere Online Board or as senior managers. It is also possible that Codere Online will be required to expand its employee base and hire additional employees to support its operations as a public company, which will increase its operating costs in future periods. Furthermore, Codere Online is subject to onerous obligations under the Registration Rights and Lock-Up Agreement and Warrant Agreement. Efforts to satisfy such obligations may divert the attention of management and key personnel and result in substantial expense, and Codere Online's ongoing failure or inability to comply with such obligations could result in disputes and litigation. Any of the foregoing could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Differences in views with current or future shareholders or partners may result in delayed decisions or in failures to agree on major matters, potentially adversely affecting certain of Codere Online's businesses.***

Differences in views among current or future shareholders or partners in Codere Online's operations may result in delayed decisions or in failures to agree on major matters, potentially adversely affecting certain of Codere Online's businesses and, in turn, Codere Online's business, results of operations and financial condition. Failure to resolve disagreements with our current or future partners could have a material adverse effect on Codere Online's business, results of operations and financial condition. Additionally, Codere Online may be forced to make certain decisions in the interest of its operations that might not be in agreement with its current or future partners and could result in litigation, arbitration or other legal procedures. Any of the foregoing could have a material adverse effect on Codere Online's business, results of operations and financial condition.

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***Codere Online depends on the skill and experience of its management and key personnel. The loss of managers or key and highly qualified personnel, or an inability to attract such personnel, could adversely impact Codere Online's business.***

The ability to maintain Codere Online's competitive position and to implement its business strategy is dependent on Codere Online's senior management team, which has many years of experience leading top tier global gaming operators and digital businesses, and key personnel with expertise in the online casino and online sports betting space.

Furthermore, Codere Online has in the past and may in the future rely on non-employee independent contractors in the ordinary course to carry out its business. Such non-employee independent contractors may have conflicts of interest in allocating their time and activity to matters relating to Codere Business. Furthermore, if any past or future independent contractors were, under relevant labor law, determined by the relevant authorities to be employees, Codere Online could be found to have tax withholding, social security and other employment obligations with respect to such contractors. As a result of the above, Codere Online's dependence on non-employee independent contractors may expose it to risks that may have a material adverse effect on Codere Online's business, results of operations and financial condition.

Furthermore, Codere Online's inability to retain certain members of the management team or other key personnel could have a material adverse effect on its business, results of operations and financial condition. Codere Online cannot guarantee that it will be able to retain its existing senior executive and management personnel or attract additional qualified senior executive and management personnel. Codere Online's success depends, in part, on its ability to identify, hire, attract, train and develop other highly qualified personnel. Experienced and highly skilled employees are in high demand and competition for these employees can be intense. Codere Online may not be able to attract, develop or retain qualified personnel in the future, and its failure to do so could adversely affect Codere Online's business, including the execution of its business strategy.

In addition, Codere Online's local officers, directors, key employees and shareholders may be required to file applications with the gaming authorities in the jurisdictions in which Codere Online operates and are required to be licensed or found suitable by these gaming authorities. If the gaming authorities were to find an officer, director, key employee or shareholder unsuitable for licensing or unsuitable to continue having a relationship with Codere Online, Codere Online would have to sever all relationships with that person. Furthermore, the gaming authorities may require Codere Online to terminate the employment of any person who refuses to file appropriate applications. Any of the foregoing factors could have a material adverse effect on Codere Online's business, results of operations and financial condition.

***Security, political and economic instability in the Middle East may harm our business, including the duration and intensity of the ongoing Israel-Hamas War and its impact on our operations and workforce.***

We maintain offices in Israel, where more than 40 of our employees (13% of our total) are located. Accordingly, political, economic and military conditions in the Middle East may affect our business directly. Since the establishment of the State of Israel in 1948, a number of armed conflicts have occurred between Israel and its neighboring countries, Hamas (an Islamist militia and political group in the Gaza Strip) and Hezbollah (an Islamist militia and political group in Lebanon).

In October 2023, Hamas infiltrated Israel's southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel's border with the Gaza Strip and in other areas within the State of Israel. Following the attack, Israel's security cabinet declared war against Hamas and commenced a military campaign against Hamas. Since then, the conflict has evolved with multiple offensives, mediation efforts, and a worsening humanitarian situation in the region. While a potential ceasefire with Hamas has been negotiated in the past, tensions remain high.

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In addition, in April 2024, Israel experienced a direct attack from Iran, involving hundreds of drones and missiles launched towards various parts of the country, mostly targeting military bases. The Israeli defense systems, aided by international allies, successfully intercepted the majority of these attacks, minimizing physical damage and casualties. More recently, in February 2025, Iran has intensified its diplomatic activities concerning its nuclear program, raising concerns within the international community.

Additionally, since October 2023, the Houthis, a military organization based in Yemen, have launched a series of attacks on global shipping routes in the Red Sea, as well as direct attacks on various parts of Israel.

While the ongoing war with Hamas and the conflict with Iran and its proxies has not, since its inception, materially impacted our business or operations, we cannot currently predict the intensity or duration of the Israel-Hamas war, nor can we predict how this war will ultimately affect our personnel in the country, business and operations.

***Our operations may be disrupted by the obligations of personnel to perform military service.***

Our employees in Israel, generally, may be called upon to perform up to 42 days (and in some cases more) of annual military reserve duty until they generally reach the age of 45 (or older in some cases) and, in emergency circumstances, could be called to active duty. In response to increased tension and hostilities, since September 2000 there have been occasional call-ups of military reservists, including in connection with the mid-2006 war in Lebanon and the December 2008, November 2012 and July 2014 conflicts with Hamas. In October 2023, Hamas invaded southern Israel and launched a widespread terrorist attack on Israel. As a result, the Israeli government declared that the country was at war and the Israeli military began to call-up reservists for active duty. To date, several employees were called for duty, but it is possible that there will be further or longer military reserve duty call-ups in the future, which may affect our business due to a shortage of skilled labor and loss of institutional knowledge, and necessary mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, which may materially adversely affect our operations, business and results of operations. Our operations could also be disrupted by the absence of a significant number of our employees related to military service or the absence for extended periods of one or more of our key employees for military service in connection with other military and security matters.

***Certain entities that form the Codere Online group may face tax liabilities as a result of their historical membership in the consolidated tax group of companies of which Codere, S.A. was the parent company.***

Certain entities that form the Codere Online group were part of a consolidated tax group of companies of which Codere, S.A. was the parent company until the financial restructuring of Codere, S.A.'s liabilities was finalized in November 2021, and as of October 2024 Codere Group Topco, S.A. is the parent company of Codere Group (the "Codere Tax Group"). In accordance with Spanish taxation law, membership of a company in a tax group is conditional upon the fulfilment of certain requirements, with the principal condition being the direct or indirect participation of the parent company in the share capital of such company (currently, a minimum of 75% of the subsidiary's share capital or 70% if the shares of the subsidiary are admitted to trading on a regulated market). Upon the consummation of the Business Combination, the Codere Group ceased to maintain the minimum participation shareholding required for any entity of the Codere Online group to remain part of the Codere Tax Group. However, the members of a tax consolidated group are jointly liable for the Spanish Corporate Income Tax and Value Added Tax debts corresponding to tax years in which they were part of a consolidated tax group. As a result, certain entities of the Codere Online group will remain jointly liable for any Corporate Income Tax and Value Added Tax corresponding to the Codere Tax Group for those tax periods in which they were part of the Codere Tax Group.

Based on Spanish legislation, taxes cannot be considered definitively settled until the returns filed have been audited by the Spanish Tax Authorities or until the four-year limitation period has elapsed - NOLs and tax credits could be audited for a period of up to 10 years following their respective submission. Consequently, if the entities that form the Codere Online group were to face tax liabilities as a result of being part of the Codere Tax Group for the fiscal years not expired, Codere Online's business, results of operations and financial condition could be materially and adversely affected.

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***Codere Online is dependent on credit and debit card payment service providers and other financial institutions to process payments and handle cash generated by its business.***

Codere Online accepts credit and debit card payments from customers among other payment methods. Certain U.S.-based card processing and card-issuing institutions currently restrict the use of their credit cards for online betting and gaming transactions. If other major card processing or card-issuing companies stop accepting payment transactions for online betting and gaming operations, this could have a material adverse effect on Codere Online's business, results of operations and financial condition.

Furthermore, some gaming regulators such as the Gambling Commission in the United Kingdom have banned the use of credit cards to place bets online (and offline). Similar measures have been discussed in other markets such as Spain. If any such restrictions to credit cards or other payment methods were to be applied in any of the regions where Codere Online operates, there could be a material adverse effect on its business, results of operations and financial condition.

Codere Online holds significant amounts of cash on hand on its balance sheet. Codere Online currently holds cash, cash equivalents and investments, and intends to hold them in the future, in large, well-known Spanish financial institutions. However, any failure or entrance into receivership by, or the insolvency of, any of these financial institutions could threaten Codere Online's ability to access its existing cash, cash equivalents and investments, result in the loss of such cash, cash equivalents and investments and adversely impact Codere Online's financial position and results of operations.

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**Risk Factors Related to the Financial Information and this Annual Report**

***Codere Online has identified a material weakness in its internal control over financial reporting. If Codere Online is unable to remediate this material weakness, or if Codere Online identifies any material weaknesses in the future or otherwise fails to maintain an effective system of disclosure controls and procedures, including internal control over financial reporting, this may result in material misstatements of Codere Online's financial statements or cause Codere Online to fail to meet its periodic reporting obligations, which may have an adverse effect on the market price of the Ordinary Shares and Codere Online Warrants. Consequences may entail financial, regulatory, legal, and reputational repercussions.***

As a public company, Codere Online acts in an increasingly demanding regulatory environment, which requires it to comply with the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), the regulations of Nasdaq, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and more complex accounting rules. Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures. Effective internal controls are necessary for Codere Online to produce reliable financial reports and are important to help prevent financial fraud.

Codere Online's senior management, including Codere Online's Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of Codere Online's internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on this assessment, Codere Online's senior management has determined that the material weakness described in Item 15 "Controls and Procedures" existed as of December 31, 2024.

Codere Online previously reported material weaknesses, which were identified in connection with the preparation of our financial statements as of and for the years ended December 31, 2022 and December 31, 2023 related to (i) a lack of sufficient technical accounting and supervisory personnel who have the appropriate level of technical accounting experience and training required to assess the appropriate accounting and disclosure of non-recurring consolidation transactions (the "First Material Weakness"), (ii) an ineffective design and lack of controls over our cash disbursement process (the "Second Material Weakness"), (iii) a failure to establish adequate controls over cybersecurity processes outsourced to the Codere Group pursuant to the Original Platform and Technology Services Agreement (the "Third Material Weakness") and (iv) lack of sufficient internal controls to support effective financial reporting (the "Fourth Material Weakness"). The First Material Weakness, the Second Material Weakness, the Third Material Weakness and, together with the Fourth Material Weakness, are collectively referred to herein as the "Codere Online Material Weaknesses".

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of Parent's consolidated financial statements will not be prevented or detected on a timely basis.

As previously disclosed, Codere Online's senior management determined that the First Material Weakness, Second Material Weakness and Third Material Weakness were remediated as of December 31, 2023.

As of December 31, 2024, Codere Online's senior management, under the supervision of Codere Online's Chief Executive Officer and Chief Financial Officer, cannot affirmatively conclude that the Fourth Material Weakness has been remediated despite the continued implementation of its remediation efforts with respect to the Fourth Material Weakness during 2024. See Item 15 "*Controls and Procedures*".

Codere Online's remediation actions with respect to the Fourth Material Weakness include the implementation of enhancements to its internal control system to strengthen the internal control environment and improve financial reporting processes. Codere Online's management will periodically assess the progress and sufficiency of the ongoing initiatives and make adjustments as and when necessary. Codere Online's management understands that the improvement and maintenance of internal controls is an ongoing responsibility. These remediation efforts are more fully described in Item 15 "Controls and Procedures."

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However, we cannot provide assurances that we will remediate the Fourth Material Weakness in a timely manner, or at all. If we are unable to successfully remediate the Fourth Material Weakness or if additional material weaknesses arise in the future, Codere Online's financial statements could contain material misstatements that, among other matters, could cause Codere Online to restate its financial statements, fail to meet its periodic reporting obligations, the price of the Ordinary Shares and Codere Online Warrants to decline, and other adverse consequences.

Furthermore, measures adopted by Codere Online to enhance its internal control over financial reporting may not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that its objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

Codere Online's independent registered public accounting firm is not required to formally attest to the effectiveness of Codere Online's internal control over financial reporting until after it is no longer an "emerging growth company" as defined in the JOBS Act. At such time, Codere Online's independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which Codere Online's internal control over financial reporting is documented, designed or operating. Any failure to maintain effective disclosure controls and procedures and internal control over financial reporting could have a material adverse effect on Codere Online's business, financial condition and results of operations and could cause the price of the Ordinary Shares and Codere Online Warrants to decline.

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**Risks Related to the Business Combination**

***Changes in value of Codere Online Warrants could have a material effect on Codere Online's financial results.***

Both the Codere Online Public Warrants and the Codere Online Private Warrants are classified as warrant liabilities under IFRS, with any changes in fair value to be reported each period in earnings on Codere Online's income statement. As a result of the recurring fair value measurement, the financial statements of Codere Online may fluctuate quarterly based on factors which are outside Codere Online's control. Due to the recurring fair value measurement, Codere Online expects that it will recognize non-cash gains or losses on the Codere Online Warrants each reporting period and that the amount of such gains or losses could be material.

***Codere Online may face litigation and other risks as a result of the Business Combination and related agreements.***

Codere Online may become subject to legal proceedings and claims that arise from the Business Combination, past actions or omissions of DD3 (including any outstanding claims against DD3 as of the Closing Date) or the SEC's and other regulatory bodies heightened scrutiny on SPACs, including any potential claims related to previously disclosed accounting restatements and material weaknesses disclosed by DD3, as well as potential legal proceedings and claims arising out of Codere Online's obligations under the Registration Rights and Lock-Up Agreement and the Warrant Agreement. Such litigation, whether or not meritorious, may result in substantial costs, divert management's attention and resources, affect Codere Online's reputation, or otherwise have a material adverse effect on Codere Online's business, results of operations and financial condition and could cause a decline in the market price of Codere Online's securities.

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**Additional Risk Factors Related to Codere Online's Securities**

***Codere Online is controlled by Codere Newco and Codere Newco's interests may not be aligned with Codere Online's interests or the interests of other shareholders.***

Codere Newco, a member of the Codere Group, owns approximately 65.7% of the outstanding Ordinary Shares as of March 31, 2025. As long as Codere Newco owns at least 50% of the outstanding Ordinary Shares, Codere Newco will have, except as otherwise described in this annual report, the ability to determine certain corporate actions requiring shareholder approval, including the election and removal of directors and the size of the Codere Online Board unless it is already determined in the articles of association of Codere Online.

Furthermore, pursuant to the Nomination Agreement, Codere Newco has the right to propose for appointment five (5) directors (collectively, the "Codere Newco Directors"), with at least two (2) of them having to qualify as independent directors (subject to independence requirements under applicable securities exchange rules that may require a greater number of independent directors). In addition, at least one (1) of the Codere Newco Directors shall qualify as a Luxembourg tax resident. This could have the effect of delaying or preventing a change in control or otherwise discouraging a potential acquirer from attempting to obtain control of Codere Online, which could cause the market price of the Ordinary Shares and Codere Online Warrants to decline or prevent shareholders from realizing a premium over the market price for the Ordinary Shares and Codere Online Warrants. Codere Newco's interests may conflict with Codere Online's interests as a company or the interests of Codere Online's other shareholders.

***There can be no assurance that the Ordinary Shares or the Codere Online Warrants will continue to be listed on Nasdaq or that Codere Online will be able to comply with the continued listing standards of Nasdaq.***

The Ordinary Shares and Codere Online Warrants are currently listed on Nasdaq.

If Nasdaq delists the Ordinary Shares or Codere Online Warrants from trading on its exchange for failure to meet the continued listing standards, Codere Online and its shareholders could face significant material adverse consequences including:

● a limited availability of market quotations for its securities;

● reduced liquidity for its securities;

● as a result of any potential future decline in the price of the Ordinary Shares, a determination that Ordinary Shares are a "penny stock" which will require brokers trading in the Ordinary Shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for its securities;

● limited or no news or analyst coverage; shareholder litigation; and

● a decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as "covered securities." So long as the Ordinary Shares and the Codere Online Warrants are listed on Nasdaq, they will be covered securities. Although the states are preempted from regulating the sale of covered securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if Codere Online ceased to be listed on Nasdaq, its securities would not be covered securities and it would be subject to regulation in each state in which it offers its securities.

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On November 18, 2024, Codere Online received a staff determination letter (the "2024 Letter"), from the Listing Qualifications Department (the "Staff") of Nasdaq, notifying Codere Online of the determination from the Staff to delist the Company's securities from The Nasdaq Stock Market, given that Codere Online had not timely filed the Form 20-F for the year ended December 31, 2023 (the "2023 Form 20-F") in accordance with continued Listing Rule 5250(c)(1) (the "Public Reports Rule"). Following receipt of the 2024 Letter, Codere Online requested both a hearing to appeal the delisting determination by the Nasdaq Hearings Panel (the "Panel") and a further stay of suspension of trading through the duration of the hearing process. On January 16, 2025, Codere Online participated in a hearing, at which the Panel considered Codere Online's plan to regain compliance with the Public Reports Rule. Following such hearing, on February 12, 2025, the Panel determined to grant Codere Online's request to continue its listing on The Nasdaq Stock Market, subject to Codere Online filing its 2023 20-F on or before May 12, 2025. Although Codere Online previously regained compliance with the Nasdaq listing requirements by filing the 2023 Form 20-F, on May 1, 2025 (which was formally communicated by the Staff of Nasdaq on May 15, 2025), Codere Online was not able to timely file this Form 20-F because of how recently Codere Online's new auditor was engaged and that additional time was necessary to complete the audit of Codere Online's financial statements for the year ended December 31, 2024, particularly driven by the significant efforts to complete and file the 2023 20-F. As a result, on May 16, 2025, Codere Online received an additional staff determination letter (the "2025 Letter"), from the Staff of Nasdaq, notifying Codere Online of the determination from the Staff to delist the Company's securities from The Nasdaq Stock Market, given that Codere Online had not timely filed this Form 20-F in accordance with the Public Reports Rule. Following receipt of the 2025 Letter, Codere Online requested both a hearing to appeal the delisting determination by the Panel and a further stay of suspension of trading through the duration of the hearing process. We believe Codere Online will have regained compliance with the Nasdaq Listing Requirements by filing this Form 20-F and will no longer be required to attend a hearing or be subject to delisting. However, a formal compliance determination from the Staff of Nasdaq confirming the Company has regained compliance is still to be received. In addition, Nasdaq will continue to monitor our ongoing compliance, and Codere Online may in the future become immediately subject to delisting without a cure period for any failure to comply with the Public Reports rule. Codere Online would be permitted to appeal any delisting determination to the Panel in a new hearing, and our ordinary shares would remain listed on the Nasdaq Capital Market pending the Panel's decision after said hearing. If Codere Online does not appeal the delisting determination or does not succeed in such an appeal, the Ordinary Shares would be removed from trading on the Nasdaq Capital Market. No assurance can be given that Codere Online will meet applicable Nasdaq continued listing standards. Failure to meet applicable Nasdaq continued listing standards could result in a delisting of the Ordinary Shares and Codere Online Warrants.

***A market for the Ordinary Shares and the Codere Online Warrants may not develop and the market price of such securities may be volatile.***

The trading of Ordinary Shares and Codere Online Warrants has been and may continue to be volatile and subject to limited volume in trading. An active trading market for Codere Online's securities may never develop or, if developed, it may not be sustained. In addition, the price of Codere Online's securities has fluctuated and may continue to fluctuate significantly. Factors that could cause fluctuations in the price of such securities include:

● actual or anticipated variations in operating results and the results of competitors;

● changes in performance projections by Codere Online or by any securities analysts that might cover Codere Online's securities, if any;

● conditions or trends in the industry, including regulatory changes;

● announcements by Codere Online or its competitors of significant acquisitions, strategic partnerships or divestitures;

● announcements of investigations or regulatory scrutiny of Codere Online's operations or lawsuits filed against it or the Codere Group;

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● additions or departures of key personnel; and

● issuances or sales of Ordinary Shares, including by key investors, especially as the lock-up restrictions under the Registration Rights and Lock-Up Agreement have expired.

Further, if Codere Online's securities become delisted from Nasdaq for any reason, the liquidity and price of such securities may be more limited than if they were quoted or listed on Nasdaq or such other securities exchange. Moreover, broad general economic, geopolitical, political, market and industry factors may adversely affect the price of Codere Online's securities, regardless of Codere Online's actual operating performance.

You may be unable to sell your securities unless a market can be established or sustained.

***If securities or industry analysts do not publish or cease publishing research or reports about Codere Online, its business, or its market, or if they change their recommendations regarding the Ordinary Shares adversely, then the price and trading volume of the Ordinary Shares and Codere Online Warrants could decline.***

The trading market for the Ordinary Shares and Codere Online Warrants may be influenced by the research reports that industry or securities analysts may publish about Codere Online, its business, its market, or its competitors. If securities or industry analysts do not publish or cease publishing research or reports about Codere Online, the prices and trading volumes of the Ordinary Shares and Codere Online Warrants would likely be negatively impacted. If any of the analysts who may cover Codere Online change their recommendation regarding the Ordinary Shares adversely, or provide more favorable relative recommendations about Codere Online's competitors, the price of the Ordinary Shares and Codere Online Warrants would likely decline. If any analyst were to cease coverage of Codere Online or fail to regularly publish reports on it, Codere Online could lose visibility in the financial markets, which could cause the Ordinary Share price and/or trading volume (and, consequently, the price and/or trading volume of the Codere Online Warrants) to decline.

***Codere Online may issue additional Ordinary Shares or other equity securities without your approval, which would dilute your ownership interest and may depress the market price of the Ordinary Shares and Private Warrants.***

As of March 31, 2025, Codere Online had 45,640,814 issued and outstanding Ordinary Shares. Codere Online's articles of association authorize Codere Online to issue Ordinary Shares and rights relating to Ordinary Shares for the consideration and on the terms and conditions established by the Codere Online Board in its sole discretion, whether in connection with financings, acquisitions, investments, equity incentive plans or otherwise. Any Ordinary Shares issued, including in connection with the exercise of Codere Online Warrants or any equity incentive plans that Codere Online may adopt in the future, would dilute the percentage ownership held by you.

Codere Online's issuance of additional Ordinary Shares or other equity securities of equal or senior rank could have the following effects:

● Codere Online's existing shareholders' proportionate ownership interest in Codere Online will decrease;

● the amount of cash available per share, including for payment of dividends in the future, may decrease;

● the relative voting strength of each previously outstanding Ordinary Share may be diminished; and

● the market price of the Ordinary Shares and Codere Online Warrants may decline.

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***Codere Online may amend the terms of the Codere Online Warrants in a manner that may be adverse to holders with the approval by the holders of at least 50% of the then outstanding Codere Online Public Warrants. As a result, the exercise price of such warrants could be increased, the exercise period could be shortened and the number of Ordinary Shares purchasable upon exercise of a warrant could be decreased, all without your approval.***

The terms of the Codere Online Warrants may be amended without the consent of any holder (i) to cure any ambiguity or correct any mistake or to cure, correct or supplement any defective provision, or (ii) to add or change any other provisions with respect to matters or questions that the parties deem to not adversely affect the interests of the registered holders of the Codere Online Warrants. In addition, Codere Online may amend the terms of the Codere Online Warrants in a manner adverse to a holder if holders of at least 50% of the then outstanding Codere Online Public Warrants approve of such amendment. The ability to amend the terms of such warrants is unlimited and examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash or stock, allow for cashless exercise of the warrants, shorten the exercise period or decrease the number of shares of Ordinary Shares purchasable upon exercise of a warrant.

***Codere Online may redeem your unexpired Codere Online Warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.***

None of the Codere Online Private Warrants will be redeemable by Codere Online so long as they are held by the initial purchasers of the Private Warrants or their permitted transferees. Once such Codere Online Private Warrants are transferred (other than to permitted transferees under the Warrant Agreement), Codere Online may redeem such Codere Online Private Warrants in the same manner as the Codere Online Public Warrants. Codere Online may redeem Codere Online Public Warrants at any time after they became exercisable on December 30, 2021 (i.e., 30 days after the Closing of the Business Combination) and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of the Ordinary Shares equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within a 30 trading-day period commencing at any time after the Codere Online Warrants became exercisable and ending on the third business day prior to proper notice of such redemption provided that on the date, Codere Online gives notice of redemption and during the entire period thereafter until the time Codere Online redeems the warrants, and provided further that Codere Online may not exercise such redemption right if the issuance of Ordinary Shares is not exempt from registration or qualification under applicable state blue sky laws or Codere Online is unable to effect such registration or qualification. As of the date of this annual report, the trading price of Ordinary Shares has not reached the $18.00 threshold. In the event Codere Online determined to redeem the Codere Online Public Warrants, holders would be notified of such redemption as described in the Warrant Agreement. Specifically, Codere Online would be required to fix a date for the redemption (the "Redemption Date"). Notice of redemption would be mailed by first class mail, postage prepaid, by Codere Online not less than 30 days prior to the Redemption Date to the registered holders of the Codere Online Public Warrants to be redeemed at their last addresses as they appear on the registration books. In addition, beneficial owners of the redeemable warrants will be notified of such redemption via Codere Online's posting of the redemption notice to DTC. Redemption of the Codere Online Public Warrants could force you (i) to exercise your Codere Online Public Warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your Codere Online Public Warrants at the then-current market price when you might otherwise wish to hold your Codere Online Public Warrants or (iii) to accept the nominal redemption price which, at the time the Codere Online Public Warrants are called for redemption, is likely to be substantially less than the market value of your Codere Online Public Warrants.

***There can be no assurance that the Codere Online Warrants will be in the money and they may expire worthless.***

The exercise price for the Codere Online Warrants is $11.50 per Ordinary Share (subject to adjustment), and the exercise period commenced on December 30, 2021 (i.e., 30 days after the Closing of the Business Combination) and will expire five years after the completion of the Business Combination or earlier upon redemption or liquidation. There can be no assurance that the Codere Online Warrants will be in the money at any time prior to their expiration, and as such, the Codere Online Warrants may expire worthless.

***It is not anticipated that any dividend will be paid to the Codere Online Shareholders for the foreseeable future.***

There are no current plans to pay cash dividends on the Ordinary Shares. When determining or proposing a dividend payment, the Codere Online Board may take into account general and economic conditions, Codere Online's financial condition and operating results, Codere Online's available cash, current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions, implications on the payment of dividends by Codere Online to its shareholders and such other factors as the Codere Online Board may deem relevant. Accordingly, Codere Online is not expected to pay any dividends on the Ordinary Shares in the foreseeable future.

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**Risks Related to Investment in a Luxembourg Company and Codere Online's Status as a Public Company**

***Codere Online has substantial regulatory reporting obligations and requirements, and as a result, Codere Online may be delayed in complying with any such obligations.***

Codere Online is subject to extensive corporate governance, reporting and accounting disclosure requirements under U.S. securities laws and regulations, including the Sarbanes-Oxley Act, as well as pursuant to Nasdaq listing standards. These laws, as well as the listing standards of Nasdaq, impose certain compliance requirements, costs and obligations on listed companies. This requires a significant commitment of resources and management oversight and Codere Online may be delayed or fail to comply with all such obligations. For example, Codere Online was delayed in timely filing the 2023 20-F as well as this annual report on Form 20-F. Failure to comply with these laws and listing standards could potentially subject us to sanctions or investigations by the SEC or other regulatory, exchange or market authorities, and related penalties, fines and litigation.

***As long as Codere Online is a foreign private issuer, Codere Online is exempt from a number of U.S. securities laws and rules promulgated thereunder and is permitted to publicly disclose less information than U.S. public companies. This may limit the information available to holders of Codere Online's securities.***

Codere Online qualifies as a "foreign private issuer," as defined in the SEC's rules and regulations, and, consequently, Codere Online is not subject to all of the disclosure requirements applicable to public companies organized within the United States. For example, Codere Online is exempt from certain rules under the Exchange Act that regulate disclosure obligations and procedural requirements related to the solicitation of proxies, consents or authorizations applicable to a security registered under the Exchange Act. In addition, Codere Online's senior managers and directors are exempt from the reporting and "short-swing" profit recovery provisions of Section 16 of the Exchange Act and related rules with respect to their purchases and sales of Codere Online's securities. For example, some of Codere Online's key executives may sell a significant amount of Ordinary Shares and such sales are not required to be disclosed as promptly as public companies organized within the United States would have to disclose. Accordingly, once such sales are eventually disclosed, the price of Codere Online's securities may decline significantly. Moreover, Codere Online is not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. public companies. Codere Online is also not subject to Regulation FD under the Exchange Act, which would prohibit Codere Online from selectively disclosing material nonpublic information to certain persons without concurrently making a widespread public disclosure of such information. Accordingly, there may be less publicly available information concerning Codere Online than there is for U.S. public companies.

As a foreign private issuer, Codere Online is required to file an annual report on Form 20-F within four months of the close of each fiscal year ended December 31 and furnish reports on Form 6-K relating to certain material events promptly after Codere Online publicly announces these events. However, because of the above exemptions for foreign private issuers, which Codere Online relies on, Codere Online Shareholders are not afforded the same information generally available to investors holding shares in U.S. public companies that are not foreign private issuers.

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***Codere Online may lose its foreign private issuer status in the future, which could result in significant additional costs and expenses. This would subject Codere Online to U.S. GAAP reporting requirements which may be difficult for it to comply with.***

As a "foreign private issuer," Codere Online would not be required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act and related rules and regulations. Under those rules, the determination of foreign private issuer status is made annually on the last business day of an issuer's most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to Codere Online on June 30, 2025.

In the future, Codere Online could lose its foreign private issuer status if a majority of its ordinary shares are held by residents in the United States and it fails to meet any one of the additional "business contacts" requirements. Although Codere Online intends to follow certain practices that are consistent with U.S. regulatory provisions applicable to U.S. companies, Codere Online's loss of foreign private issuer status would make such provisions mandatory. The regulatory and compliance costs to Codere Online under U.S. securities laws if it is deemed a U.S. domestic issuer may be significantly higher. If Codere Online is not a foreign private issuer, Codere Online will be required to file periodic reports and prospectuses on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer. Codere Online also may be required to modify certain of its policies to comply with good governance practices associated with U.S. domestic issuers. Such conversion and modifications will involve additional costs. In addition, Codere Online may lose its ability to rely upon exemptions from certain corporate governance requirements of Nasdaq that are available to foreign private issuers. For example, Nasdaq's corporate governance rules require listed companies to have, among other things, a majority of independent board members and independent director oversight of executive compensation, nomination of directors, and corporate governance matters. Nasdaq rules also require shareholder approval of certain share issuances, including approval of equity compensation plans. As a foreign private issuer, Codere Online is permitted to follow home country practice in lieu of the above requirements. As long as Codere Online relies on the foreign private issuer exemption to certain of Nasdaq's corporate governance standards, a majority of the directors on the Codere Online Board are not required to be independent directors, Codere Online is not required to have a compensation committee or a nominating and corporate governance committee and Codere Online is not required to obtain shareholder approval of equity compensation plans.

Also, if Codere Online loses its foreign private issuer status, Codere Online may be required to change its basis of accounting from IFRS as issued by the IASB to U.S. GAAP, which may be difficult and costly for it to comply with. If Codere Online loses its foreign private issuer status and fails to comply with U.S. securities laws applicable to U.S. domestic issuers, Codere Online may have to de-list from Nasdaq and could be subject to investigation by the SEC, Nasdaq and other regulators, among other materially adverse consequences.

If Codere Online no longer qualifies as a foreign private issuer, it may be eligible to take advantage of certain exemptions from Nasdaq's corporate governance standards if it continues to qualify as a "controlled company." Codere Newco owned approximately 65.7% of the issued and outstanding Ordinary Shares as of March 31, 2025. As a result, Codere Online is a "controlled company" within the meaning of Nasdaq rules. Under these rules, a company in respect of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company is a "controlled company" and may elect not to comply with certain corporate governance requirements, including:

● the requirement that a majority of its board of directors consist of independent directors;

● the requirement that compensation of its senior managers be determined by a majority of the independent directors of the board or a compensation committee comprised solely of independent directors with a written charter addressing the committee's purpose and responsibilities; and

● the requirement that director nominees be selected, or recommended for the board's selection, either by a majority of the independent directors of the board or a nominating and corporate governance committee comprised solely of independent directors with a written charter addressing the committee's purpose and responsibilities.

As long as Codere Online elects to take advantage of these exemptions, holders of Codere Online's securities will not have the same protections afforded to holders of securities of companies that are subject to all the Nasdaq corporate governance standards.

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***The JOBS Act permits "emerging growth companies" like Codere Online to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.***

Codere Online currently qualifies as an "emerging growth company" as defined in Section 2(a)(19) of the Securities Act, as modified by the JOBS Act. As such, Codere Online takes advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as it continues to be an emerging growth company, including the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act. As a result, Codere Online Shareholders may not have access to certain information they deem important.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as it is an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable. Codere Online has elected to avail itself of such extended transition period, which means that when a standard is issued or revised, and it has different application dates for public or private companies, Codere Online, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of Codere Online's financial statements with those of another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Codere Online cannot predict if investors will find the Ordinary Shares and/or Codere Online Warrants less attractive because it relies on these exemptions. If some investors find the Ordinary Shares and/or Codere Online Warrants less attractive as a result, there may be a less active trading market and the price for the Ordinary Shares and/or Codere Online Warrants may be more volatile.

Codere Online may not qualify as an emerging growth company in the future and may incur increased legal, accounting and compliance costs associated with Section 404 of the Sarbanes-Oxley Act or other matters as a result.

***Codere Online is organized under the laws of Luxembourg and substantially all of its assets are located outside the United States. It may be difficult for you to obtain or enforce judgments or bring original actions against Codere Online or the members of its board of directors in the United States.***

Codere Online is organized under the laws of the Grand Duchy of Luxembourg. In addition, substantially all of its assets are located outside the United States. Furthermore, we understand that all but one of Codere Online's directors and members of the senior management team reside outside the United States as of the date of this annual report. Investors may not be able to effect service of process within the United States upon Codere Online or these persons or enforce judgments obtained against Codere Online or these persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it also may be difficult for an investor to enforce in U.S. courts judgments obtained against Codere Online or these persons in courts located in jurisdictions outside the United States, including judgments predicated upon the civil liability provisions of the U.S. federal securities laws. Awards of punitive damages in actions brought in the United States or elsewhere are generally not enforceable in Luxembourg.

As there is no treaty in force on the reciprocal recognition and enforcement of judgments in civil and commercial matters between the United States and Luxembourg, courts in Luxembourg will not automatically recognize and enforce a final judgment rendered by a U.S. court. A valid judgment obtained from a court of competent jurisdiction in the United States may be entered and enforced through a court of competent jurisdiction in Luxembourg, subject to compliance with the enforcement procedures (exequatur). The enforceability in Luxembourg courts of judgments rendered by U.S. courts will be subject, prior to any enforcement in Luxembourg, to the procedure and the conditions set forth in the Luxembourg procedural code, which conditions may include the following as of the date of this annual report (which may change):

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● the judgment of the U.S. court is final and enforceable (*exécutoire*) in the United States;

● the U.S. court had jurisdiction over the subject matter leading to the judgment (that is, its jurisdiction was in compliance both with Luxembourg private international law rules and with the applicable domestic U.S. federal or state jurisdictional rules);

● the U.S. court applied to the dispute the substantive law that would have been applied by Luxembourg courts (based on recent case law and legal doctrine, it is not certain that this condition would still be required for an exequatur to be granted by a Luxembourg court);

● the judgment was granted following proceedings where the counterparty had the opportunity to appear and, if it appeared, to present a defense, and the decision of the foreign court must not have been obtained by fraud, but in compliance with the rights of the defendant;

● the U.S. court acted in accordance with its own procedural laws; and

● the decisions and the considerations of the U.S. court must not be contrary to Luxembourg's international public policy rules or have been given in proceedings of a tax or criminal nature or rendered subsequent to an evasion of Luxembourg law (*fraude à la loi*). Awards of damages made under civil liabilities provisions of the U.S. federal securities laws, or other laws, which are classified by Luxembourg courts as being of a penal or punitive nature (for example, fines or punitive damages), might not be recognized by Luxembourg courts. Ordinarily, an award of monetary damages would not be considered as a penalty, but if the monetary damages include punitive damages, such punitive damages may be considered a penalty.

In addition, actions brought in a Luxembourg court against Codere Online, the members of the Codere Online Board, its senior managers, or the experts named herein to enforce liabilities based on U.S. federal securities laws may be subject to certain restrictions. In particular, Luxembourg courts generally do not award punitive damages. Litigation in Luxembourg also is subject to rules of procedure that differ from the U.S. rules, including, with respect to the taking and admissibility of evidence, the conduct of the proceedings and the allocation of costs. Proceedings in Luxembourg would have to be conducted in the French or German language, and all documents submitted to the court would, in principle, have to be translated into French or German. For these reasons, it may be difficult for a U.S. investor to bring an original action in a Luxembourg court predicated upon the civil liability provisions of the U.S. federal securities laws against Codere Online, the members of the Codere Online Board, its senior managers, or the experts named herein. In addition, even if a judgment against Codere Online, the members of the Codere Online Board, its senior managers, or the experts named in this annual report based on the civil liability provisions of the U.S. federal securities laws is obtained, a U.S. investor may not be able to enforce it in U.S. or Luxembourg courts.

Pursuant to article 8.10 of the articles of association of Codere Online, subject to the exceptions and limitations listed below and mandatory provisions of Luxembourg law, the directors, senior managers or agents of Codere Online will be entitled to indemnification from Codere Online to the fullest extent permitted by Luxembourg law against liability and expenses reasonably incurred or paid by him or her in connection with any claim, action, suit, or proceeding in which he or she would be involved by virtue of his or her being or having been a director, senior manager or agent of Codere Online and against amounts paid or incurred by him or her in the settlement thereof. Luxembourg law permits Codere Online to keep directors indemnified against any expenses, judgments, fines and amounts paid in connection with liability of a director towards a third party for breach of the articles of association of Codere Online or of the provisions of the 1915 Law, except in connection with criminal offenses, bad faith, willful misconduct, gross negligence or fraud. The rights to and obligations of indemnification among or between Codere Online and any of its current or former directors and senior managers are generally governed by the laws of Luxembourg and subject to the jurisdiction of the Luxembourg courts, unless such rights or obligations do not relate to or arise out of such persons' capacities listed above. Although there is doubt as to whether U.S. courts would enforce this indemnification provision in an action brought in the United States under U.S. federal or state securities laws, this provision could make it more difficult to obtain judgments outside Luxembourg or from non-Luxembourg jurisdictions that would apply Luxembourg law against Codere Online's assets in Luxembourg.

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***Luxembourg and European insolvency and bankruptcy laws are substantially different from U.S. insolvency and bankruptcy laws and may offer Codere Online Shareholders less protection than they would have under U.S. insolvency and bankruptcy laws.***

As a company organized under the laws of the Grand Duchy of Luxembourg and with its registered office in Luxembourg, Codere Online is subject to Luxembourg insolvency and bankruptcy laws in the event any insolvency proceedings are initiated against it, including, among other things, Council and European Parliament Regulation (EU) 2015/848 of May 20, 2015 on insolvency proceedings (recast). Should courts in another European country determine that the insolvency and bankruptcy laws of that country apply to Codere Online in accordance with and subject to such European Union regulations, the courts in that country could have jurisdiction over the insolvency proceedings initiated against Codere Online. Insolvency and bankruptcy laws in Luxembourg or the relevant other European country, if any, may offer Codere Online Shareholders less protection than they would have under U.S. insolvency and bankruptcy laws and make it more difficult for them to recover the amount they could expect to recover in a liquidation under U.S. insolvency and bankruptcy laws.

***The rights of Codere Online Shareholders may differ from the rights they would have as shareholders of a United States corporation, which could adversely impact trading in Ordinary Shares and Codere Online's ability to conduct equity financings.***

Codere Online's corporate affairs are governed by Codere Online's articles of association and the laws of the Grand Duchy of Luxembourg, including the 1915 Law. The rights of Codere Online Shareholders and the responsibilities of its directors and senior managers under Luxembourg law are different from those applicable to a corporation incorporated in the United States. For example, under Delaware law, the board of directors of a Delaware corporation bears the ultimate responsibility for managing the business and affairs of a corporation. In discharging this function, directors of a Delaware corporation owe fiduciary duties of care and loyalty to the corporation and its stockholders. Luxembourg law imposes a duty on directors of a Luxembourg company to: (i) act in good faith with a view to the best interests of a company; and (ii) exercise the care, diligence, and skill that a reasonably prudent person would exercise in a similar position and under comparable circumstances. Although under Delaware law the board of directors bears the ultimate responsibility for management, in certain circumstances a stockholder may bring a derivative action on behalf of a corporation to enforce a corporation's rights against fiduciaries. Under Luxembourg law, the board of directors has sole authority to decide whether to initiate legal action to enforce a company's rights (other than, in certain circumstances, an action against members of the Codere Online Board, which may be initiated by the general meeting of the shareholders, or, subject to certain conditions, by minority shareholders holding together at least 10% of the voting rights in the company). Further, under Luxembourg law, there may be less publicly available information about Codere Online than is regularly published by or about U.S. issuers. In addition, Luxembourg laws governing the securities of Luxembourg companies may not be as extensive as those in effect in the United States, and Luxembourg laws and regulations in respect of corporate governance matters might not be as protective of minority shareholders as are state corporation laws in the United States. Therefore, Codere Online Shareholders may have more difficulty in protecting their interests in connection with actions taken by Codere Online's directors, senior managers or principal shareholders than they would as shareholders of a corporation incorporated in the United States. As a result of these differences, Codere Online Shareholders may have more difficulty protecting their interests than they would as shareholders of a U.S. issuer.

***Foreign direct investment restrictions in Spain may be applicable if any foreign investor holds directly or indirectly 10% or more of the share capital of Codere Online.***

The Spanish Government has enacted restrictions regarding foreign direct investment ("FDI") in Spain. As a general rule, if a foreign investor (*i.e.*, a non-EU or non-EFTA investor, or a EU and EFTA investor that is deemed to be beneficially owned by a non-EU or non-EFTA investor) acquires, directly or indirectly, 10% or more of a Spanish entity's share capital (including, potentially, Codere Online's Spanish subsidiaries), or otherwise acquires control of such entity, such investment needs to be pre-approved by the relevant Spanish authorities if the Spanish entity operates in one of the sectors that according to article 7.bis of Spanish Law 19/2003, of July 4, have an impact on the public security, public order or public health or if such foreign investor is either (i) controlled directly or indirectly by a foreign government (including federal governments, governmental agencies, armed forces and equivalent public entities); (ii) has invested in other EU member states in sectors which may have an impact on the public security, public order or public health of such member state; and (iii) there is a risk that such investor carries out illegal activities which affect public order, public security and/or public health of Spain. Failure to obtain such prior approval, where required, will render an acquisition null and void. In addition, sanctions could be imposed in an amount equivalent to the restricted investment.

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**Risks Relating to U.S. Taxes**

***The Internal Revenue Service may not agree that Codere Online should be treated as a non-U.S. corporation for U.S. federal income tax purposes.***

A corporation is generally considered for U.S. federal income tax purposes to be a tax resident in the jurisdiction of its organization or incorporation. Accordingly, under the generally applicable U.S. federal income tax rules, Codere Online, which is incorporated under the laws of Luxembourg, should be classified as a non-U.S. corporation (and, therefore, not a U.S. tax resident) for U.S. federal income tax purposes. However, Section 7874 of the Internal Revenue Code of 1986, as amended (the "Code") provides an exception to this general rule. Under Section 7874, a corporation created or organized outside the United States will nevertheless be treated as a U.S. corporation for U.S. federal income tax purposes (and therefore, subject to U.S. federal income tax on its worldwide income) if each of the following three conditions are met: (i) the non-U.S. corporation, directly or indirectly, acquires substantially all of the properties held directly or indirectly by a U.S. corporation (including through the acquisition of all of the outstanding shares of the U.S. corporation); (ii) the non-U.S. corporation's "expanded affiliated group" does not have "substantial business activities" in the non-U.S. corporation's country of organization or incorporation and tax residence relative to the expanded affiliated group's worldwide activities (this test is referred to as the "substantial business activities test"); and (iii) after the acquisition, the former shareholders of the acquired U.S. corporation hold at least 80%, or in certain circumstances 60%, as described below (by either vote or value) of the shares of the non-U.S. acquiring corporation by reason of holding shares in the U.S. acquired corporation (taking into account the receipt of the non-U.S. corporation's shares in exchange for the U.S. corporation's shares), as determined for purposes of Section 7874 (this test is referred to as the "Ownership Test"). Where the non-U.S. acquiring corporation is a tax resident of a different jurisdiction than an acquired non-U.S. corporation acquired in connection with the acquisition of the U.S. corporation, the Ownership Test will generally be satisfied if the shareholders of the acquired U.S. corporation receive at least 60% of the stock of the non-U.S. acquiring corporation. Under Treasury regulations, in certain circumstances shareholders of the acquired U.S. corporation may be treated as owning stock of the non-U.S. acquiring corporation for purposes of the Ownership Test in excess of their actual ownership stake in the non-U.S. acquiring corporation. Since Codere Online is incorporated under the laws of Luxembourg, the Ownership Test would generally be satisfied if the stockholders of DD3 were treated as owning at least 60% of the stock of Codere Online on the Merger date.

For purposes of Section 7874 of the Code the first two conditions described above were met with respect to the Business Combination because Codere Online acquired indirectly all of the assets of DD3 through the Merger, and Codere Online, including its "expanded affiliated group," did not satisfy the substantial business activities test upon consummation of the Merger. As a result, whether Section 7874 applies to cause Codere Online to be treated as a U.S. corporation for U.S. federal income tax purposes following the Merger would depend on the satisfaction of the Ownership Test.

Based upon the terms of the Merger and the rules for determining share ownership under Section 7874 and the Treasury Regulations promulgated thereunder, Codere Online believes that for purposes of the Ownership Test the ownership percentage of DD3 stockholders in Codere Online was less than 60%. Accordingly, Codere Online believes that it should not be treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874. However, the rules for determining ownership under Section 7874 are complex, unclear in some respects, and the subject of ongoing and recent legislative and regulatory review. Accordingly, there can be no assurance that the Internal Revenue Service ("IRS") would not assert a contrary position or that such an assertion would not be sustained by a court.

If Codere Online were treated as a U.S. corporation for U.S. federal income tax purposes, it could be subject to substantial liability for additional U.S. income taxes. In addition, the gross amount of any dividend paid to its non-U.S. shareholders would be subject to 30% U.S. withholding tax, subject to the provisions of any applicable income tax treaty.

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***Although Codere Online believes that it was not a passive foreign investment company ("PFIC") for U.S. federal income tax purposes for its 2024 taxable year, due to the Ordinary Shares' price fluctuations Codere Online can give no assurance as to its PFIC status for 2025 or any future taxable year, and if Codere Online becomes a PFIC U.S. holders of Ordinary Shares or Codere Online Warrants could be subject to adverse U.S. federal income tax consequences.***

If Codere Online is treated as a "passive foreign investment company" (a "PFIC") for U.S. federal income tax purposes for any taxable year during which a U.S. shareholder holds Ordinary Shares, certain adverse U.S. federal income tax consequences may apply to such U.S. shareholder. PFIC status depends on the composition of a company's income and assets and the fair market value of its assets from time to time, as well as on the application of complex statutory and regulatory rules that are subject to potentially varying or changing interpretations. Based on the composition of Codere Online's income and assets, and the estimated value of its assets, including goodwill (which is based in part on the trading prices of the Ordinary Shares), Codere Online believes that it was not a PFIC for its 2023 or 2024 taxable years. However, because the tests for determining PFIC status are applied annually after the close of each taxable year and it is difficult to accurately predict future income and assets relevant to this determination, there can be no assurance that Codere Online will not be a PFIC for any taxable year. In particular, Codere Online holds a substantial amount of cash and while that continues to be the case its PFIC status for any taxable year will depend primarily on the average value of its goodwill. Because Codere Online's market capitalization has been volatile, if the value of Codere Online's goodwill is determined by reference to its market capitalization there is a significant risk that Codere Online could be a PFIC for its current taxable year of 2025 or any future taxable year. Therefore, Codere Online cannot express any expectation or assurance regarding its PFIC status for the current or any future taxable year.

If Codere Online were treated as a PFIC, a U.S. shareholder generally would be subject to adverse U.S. federal income tax consequences, such as taxation at the highest marginal ordinary income tax rates on capital gains and on certain actual or deemed distributions, interest charges on certain taxes treated as deferred, and additional reporting requirements. Under proposed Treasury regulations that have a retroactive effective date, options to acquire stock of a PFIC would be subject to the same rules. Certain elections (such as a mark-to-market election) may be available to U.S. shareholders to mitigate some of the adverse tax consequences resulting from PFIC treatment, but U.S. holders will not be able to make similar elections with respect to the Codere Online Warrants. See "*U.S. Federal Income Tax Considerations—U.S. Holders—Passive Foreign Investment Company Rules*."

***If a U.S. person is treated as owning at least 10% of Ordinary Shares, such person may be subject to adverse U.S. federal income tax consequences.***

If a U.S. person is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of Ordinary Shares, such person may be treated as a "United States shareholder" with respect to any of Codere Online's direct and indirect non-U.S. subsidiaries (together, "Codere Online Group") that is a "controlled foreign corporation," or CFC, for U.S. federal income tax purposes. Because the Codere Online Group includes DD3, which is a U.S. subsidiary, under constructive ownership attribution rules Codere Online's non-U.S. subsidiaries could be treated as CFCs even if Codere Online itself is not a CFC.

If Codere Online or any of its subsidiaries is a CFC, 10% "United States shareholders" will be subject to adverse income inclusion and reporting requirements. Codere Online is not required to assist holders in determining whether Codere Online or any of its non-U.S. subsidiaries is treated as a CFC or whether any holder is treated as a United States shareholder with respect to any of such CFCs or furnish to any holder information that may be necessary to comply with reporting and tax paying obligations.

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**Item 4. Information on the Company**

**A.** **History and Development of the Company** 

Codere Online Luxembourg, S.A. was incorporated under the laws of the Grand Duchy of Luxembourg by Codere Newco on June 4, 2021 as a limited liability company (*société anonyme*) having its registered office at 7 rue Robert Stümper, L-2557 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Companies Register (*Registre de Commerce et des Sociétés, Luxembourg*) under number B255798 and with telephone number +34 91354 28 19. Codere Online Luxembourg, S.A. was incorporated with an initial share capital of €30,000, represented by 30,000 Ordinary Shares with a nominal value of €1 per share.

Prior to the consummation of the Business Combination, Codere Online owned no material assets and did not operate any business. On November 29 and November 30, 2021, the Exchange and the Merger were completed, respectively, and the Business Combination was consummated. As a result of the foregoing, SEJO and DD3 became direct wholly-owned subsidiaries of Codere Online. The Business Combination resulted in gross proceeds of approximately $116 million to Codere Online, or approximately $103 million net of transaction fees and expenses. The Ordinary Shares and Codere Online Warrants began trading on the Nasdaq Capital Market on December 1, 2021, under the symbols "CDRO" and "CDROW," respectively. Codere Online became the first online gaming operator in Latin America to become publicly listed in the United States.

As of December 31, 2024, Codere Online's share capital amounted to €45,491,175, represented by 45,491,175 Ordinary Shares, with a nominal value of €1.00 per share. All issued shares are fully paid and subscribed for. The authorized capital of Codere Online amounts to €499,630,781 divided into 499,630,781 Ordinary Shares with a nominal value of €1.00 each.

At a general meeting held on March 3, 2025, Codere Online shareholders authorized the repurchase of up to 1 million of the Company's ordinary shares over a one-year period. As of May 28, 2025, Codere Online had repurchased 77,005 shares at an average price of $6.67 under the authorized share buyback plan.

There have been no material capital expenditures or divestitures for any of the years ended December 31, 2024, 2023 and 2022. There are no material capital expenditures or divestitures currently in progress as of the date of this annual report.

The Company is required to file with the SEC an Annual Report on Form 20-F containing financial statements audited by an independent accounting firm. The SEC also maintains a website at http://www.sec.gov that contains reports and other information that the Company files with or furnishes electronically to the SEC. We also maintain a website at https://www.codereonline.com. Through our website, we make available, free of charge, the SEC filings. The information contained on, or that may be accessed through, our website is not part of, and is not incorporated into, this annual report.

**B.** **Business Overview** 

**Overview**

Codere Online is an international online casino gaming and online sports betting group focused on providing its customers with a safe and enjoyable online gaming experience. Codere Online currently operates primarily in Spain, Mexico, Colombia, Panama and Argentina, where it offers its users the ability to play online casino games and bet on sports events. Codere Online seeks to innovate and expand its product offering on its established and flexible technology platform as it pursues its vision to be a leading online casino gaming and online sports betting operator in Latin America. Codere Online maintains a wide and updated catalogue of online casino games from multiple third-party content providers.

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As part of the Codere Group, Codere Online leverages the "Codere" brand, a well-recognized brand in the gaming industry across Spain and Latin America, by providing customers with an online gaming experience consistent with the Codere Group's retail footprint. The Codere Group is a leading international gaming operator founded in 1980 with a presence across Spain and Latin America, including in all of the markets where Codere Online operates. The Codere Group had over 45,000 slots in nearly 7,000 controlled and third-party retail venues throughout Latin America, Spain and Italy as of December 31, 2024.

In 2014, the Codere Group entered into the online gaming business in Spain to pursue new avenues of growth and diversification of its revenue streams, first through Desarrollo Online de Juegos Regulados, S.A. and CDON, and Codere Apuestas, S.A.U. in Madrid, Spain, and afterwards independently through CDON, which was created to lead the Codere Group's expansion into the online casino gaming and online sports betting markets beyond Spain. To enhance its business, in 2018, the Codere Group recruited an experienced online management team led by industry veteran Moshe Edree with top tier online casino gaming and online sports betting expertise. Mr. Edree was replaced by former Chief Operating Officer Aviv Sher on March 1, 2023. As of March 31, 2025, Codere Online had approximately 325 employees, including directors, intermediate managers, technicians and administrative personnel based in Spain, Mexico, Colombia, Panama, Argentina and Israel. Codere Online operates under the "Codere" brand across all of its markets.

Codere Online believes it is well-positioned for continued growth with the support of the "Codere" brand, its dedicated and highly-experienced management team, its established and flexible technology platform, and other macroeconomic and industry tailwinds. Codere Online believes that this privileged combination of expertise, brand recognition and infrastructure across multiple jurisdictions will not only support its continued success in the markets in which it operates, but also allow Codere Online to capture market share in existing markets and in other expansion markets in the future. In particular, Codere Online may decide to expand into other markets in Latin America (several of which have recently regulated or are expected to be regulated in the near future), including Brazil, Chile, Peru, Puerto Rico and Uruguay, as well as Argentina (beyond the City of Buenos Aires, where it started operating in December 2021 and the Province of Mendoza, where it was awarded an online gaming license in April 2023 and began operating in 2024), subject to obtaining the required regulatory approvals once such markets become regulated. Additionally, Codere Online intends to explore options to access the large Hispanic market in the United States.

Codere Online's product offering and platform are designed to create exciting online casino gaming and online sports betting experiences for its customers. Codere Online's established and flexible technology platform has an extensive track record of successfully serving its customers and provides the business with a solid foundation for future growth.

Codere Online has established itself as a leading operator across a number of markets since it began operations. According to Codere Online's estimates, Codere Online's market share in the online gaming markets of Mexico, Colombia, Panama and Spain ranged between approximately 2% and 22% in each of such markets in terms of net gaming revenue as of December 31, 2024. Since the Business Combination, which was consummated in November 2021, Codere Online has been using a significant part of the proceeds to fund customer acquisition costs in order to accelerate the acquisition of new customers and market share growth in Spain, Mexico and its other markets. Codere Online is currently in the process of shifting its priority from primarily pursuing growth to also focusing on profitability and sustainability of its operations.

In the City of Buenos Aires, Iberargen S.A., a subsidiary of the Codere Group, started operating in December 2021 and was the first operator to receive approval for its platform implementation program in October 2020 by the City of Buenos Aires' regulator, LOTBA (*Lotería de Buenos Aires*). In addition, Codere Online expects to benefit from the Codere Group's leading retail presence in the province of Buenos Aires, where it operates 13 bingo halls and has a significant market share. Further, Codere Online has expanded its operations in Argentina to the Province of Mendoza, where it was awarded an online gaming license in April 2023 and began operating in 2024.

Codere Online commenced operations in the Province of Mendoza, Argentina, in May 2024. Additionally, on July 10, 2024, the Company incorporated Codere Online México S.A. de C.V., which, as of the date hereof, has not commenced operations nor hired employees. These developments reflect Codere Online's continued efforts to strengthen its presence in regulated jurisdictions throughout the region.

For the twelve months ended December 31, 2024, Codere Online's revenues grew to €200.7 million compared to €161.6 million for the twelve months ended December 31, 2023, mainly driven by strong revenue growth in online casino for the year compared to 2023 and strong revenue trends in Mexico and Spain. For the twelve months ended December 31, 2023, Codere Online's revenues grew to €161.6 million compared to €115.7 million for the twelve months ended December 31, 2022, mainly driven by strong revenue growth in online casino for the year compared to 2022.

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**Codere Online's Plan**

Codere Online aims to become a leading online casino gaming and online sports betting operator in Latin America. Following the Business Combination in November 2021, Codere Online increased its marketing expenditure by signing new high-profile sponsorships, increasing its presence in traditional and acquisition media and engaging marketing agencies and affiliates. It is also undertaking technology enhancements to support growth, including the continuous improvement of its mobile application features, the implementation of a new bonus engine and a continuous player and content management system upgrade. Finally, Codere Online is assessing options to expand into new high growth Latin American markets that are expected to open up through new regulatory frameworks and licensing regimes and fund any resulting licensing costs.

Although Codere Online is in the process of shifting its priority from primarily pursuing growth to also focusing on profitability and sustainability of its operations, Codere Online intends to continue making significant investments to support its business operations.

Codere Online's experience in Latin America is expected to serve as a foundation in the pursuit of options to access the large Hispanic market in the United States in the future, which the Company believes is currently under-penetrated. In particular, Codere Online believes the following to be key factors for any such future expansion: the football-first focus of the online sports betting business leveraging sponsorships with football clubs (including Real Madrid and Rayados) and/or former football players (such as Carlos Valderrama in Colombia), an online casino product configuration tailored to Hispanic customers (emphasizing electronic bingo and roulette), adapted marketing messaging and promotional campaigns based on cultural associations and affinities, experienced Spanish-speaking call center and customer service, tested Spanish-language front end user interface and experience operating under multiple regulatory regimes across a number of jurisdictions.

**Market Opportunity**

As stated above, Codere Online aims to become a leading online casino gaming and online sports betting operator in Latin America, which is a fast-growing part of the larger global gaming industry. Online casino gaming and online sports betting include all online casino games played on a computer or mobile device such as slots, video poker, electronic table games and live dealer table games, bingo and online sports wagering. While the global online casino gaming and online sports betting market has experienced significant growth in the last decade, it still remains in the early innings as customers continue to adopt online and mobile platforms, even more so across our Latin American core and intended expansion markets.

Furthermore, the COVID-19 pandemic served as a catalyst to accelerate growth in the online casino gaming and online sports betting industry as many people spent, and continue to spend, more time at home. The COVID-19 pandemic changed the manner in which people work and live, with an increased use and dependence on technology and a need for at-home entertainment options. The number of people engaging in online casino gaming and online sports betting increased significantly as a result of these changes.

In Latin America, Codere Online currently operates in Mexico, Colombia, Panama and Argentina. Latin America is expected to represent a key market opportunity within the global online casino gaming and online sports betting industry. While most of the region's online casino gaming and online sports betting markets are not yet regulated (markets are either unregulated or have express prohibitions), regulatory frameworks have either been put in place or are expected to be underway over the short to medium-term in regions such as Brazil, Chile, Peru, Puerto Rico, Uruguay and Argentina (excluding the Province and the City of Buenos Aires, the Province of Cordoba and the Province of Mendoza (Argentina), where there are already regulatory frameworks in place). Some key markets have opened in recent years through new regulatory frameworks and licensing regimes, including Panama in 2018, Colombia in 2019, the Province and the City of Buenos Aires (Argentina) in 2021, the Province of Mendoza in 2023 and Brazil and Peru in 2024. As a result, the Latin American region, which has historically been dominated by unregulated and/or illegal offshore market operators is opening up to regulated, on-shore market operators such as Codere Online. The Latin American online casino gaming and online sports betting market is expected to not only experience a shift of customers from offshore operators to regulated operators like Codere Online, but also to grow by attracting new users that previously did not participate, due to a lack of trust playing with offshore operators, a lack of payment processing solutions, lack of local customer support or otherwise.

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The Codere Group was an early entrant in Latin America, with retail operations dating back to 1984, and has developed market expertise while facing limited competition from global gaming operators, allowing for a significant first mover advantage. Codere Online believes that it benefits from its relationship with the Codere Group and its expansive retail footprint of approximately 45,000 slots in around 7,000 controlled and third-party retail venues throughout Latin America and Spain as of December 31, 2024 and a significant number of registered clients in Spain, Mexico, Colombia, Panama and Argentina, to create value through the existing omnichannel business model. Furthermore, Codere Online expects to continue to have significant support from the Codere Group through several contractual arrangements described in Item 7.B. "*Related Party Transactions."*

**Our Products**

Codere Online offers its users the ability to play a wide range of online casino games and to bet online on sports events.

*Online casino games*

Online casino offerings include the full portfolio of games typically available in land-based casinos, gaming halls and gambling establishments, such as slot machines, table games and bingo. For these offerings, Codere Online functions similarly to land-based casinos, generating revenue, as users play against the house. There is certain volatility with online casino wagering, as with land-based wagering, but as the volume of wagers placed increases, the revenue retained from wagers placed becomes easier to predict. Codere Online's experience has been that online casino margins are less volatile than online sports margins.

Codere Online's online gaming offerings consist of a combination of licensed content from leading suppliers in the industry. Third-party content is subject to standard revenue-sharing agreements specific to each supplier, whereby the supplier receives a percentage of the gaming revenue generated from the games played on Codere Online's platform. In exchange, Codere Online receives a limited license to offer the games on its platform to users in jurisdictions where use is approved by the regulatory authorities.

Codere Online maintains a wide and updated catalogue of online casino games from multiple third-party content providers. Codere Online believes that its ability to offer a wide array of online gaming products effectively reduces its customer acquisition costs and player churn by providing a superior product offering to customers.

*Online sports betting and other bets*

Online sports betting involves a user placing a wager on an event at some fixed odds (a "proposition") determined by Codere Online. If the user wins, Codere Online pays out the bet. If the user loses, Codere Online keeps the amount wagered. Codere Online takes risk on any such wager to the extent that its "book" (i.e., wagers accepted for either or all propositions bet outcomes) may not be balanced and, depending on the result of the event, Codere Online may generate an aggregate win or loss on the overall book. Codere Online seeks to generate revenue by setting odds such that there is a built-in theoretical margin in each proposition offered to its users. While different outcomes of the events may cause volatility in Codere Online's revenue, Codere Online believes it can deliver a fairly stable sports betting margin over the long term.

As part of the platform, Codere Group's Trading and Risk team is responsible for implementing the pricing strategy (*i.e.*, setting and continuously adjusting, based on averaging activity, the fixed odds) defined by Codere Online and its furtherance of Codere Online's online sports betting offering. For a more detailed description, see "*—Technology Platform*." In addition to traditional pre-match wagering, where Codere Online has a robust offering with historical data, odds statistics and latest teams and players news, Codere Online offers other sports wagering products such as live betting. Codere Online has also incorporated live streaming of sporting events into its online sports betting offering, on a round-the-clock basis and with industry-leading match visualization features.

Codere Online's online sports betting business has a vast and diversified offering with over thousands of live events per year throughout most major sports taking place around the world, which helps to minimize the impact of seasonality. Nonetheless, seasonality has an effect in certain periods of the year given the relative popularity of certain local sports, such as top tier football in Europe.

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**Technology Platform**

Codere Online, pursuant to the New Platform and Technology Services Agreement entered into with the Codere Group, has access to an established and flexible platform that supports online slots, video bingo, live casino, table games, sports live streaming and pre-match and live sports betting in most of the regions in which Codere Online operates (initially Spain, Colombia, Panama, the City of Buenos Aires, and, expectedly, its Latin American expansion markets). Codere Online operates in Mexico pursuant to a turn-key solution with Playtech. The Playtech partnership enables Codere Online's management team to leverage leading platforms tailored and proven in the Mexican market. Codere Online's management team's extensive experience successfully operating with different technology platforms across various markets allows Codere Online to selectively determine which technology platform is best suited for each market and whether Codere Online's proprietary technology platform or a third-party solution will best position the business for success.

To further enhance its platform, Codere Online has invested and expects to continue investing to support the development of additional capabilities in order to maintain and enhance the platform. These capabilities are intended to be developed mostly in-house and to feature, within its functional scope, fraud and payments systems, customer relationship management and content management systems (CRM and CMS, respectively), as well as, within its non-functional scope, further improvements in digital architecture, front-end performance, quality assurance, development, security and operations (DevSecOps) resources, and customer service.

Codere Online expects its platform, as improved by these future enhancements, to allow for more efficient and effective CRM campaigns. In particular, Codere Online's CRM strategy aims to identify customers and drive them to their preferences and most profitable channels, while leveraging all management tools (including email, SMS, push notifications, social media and automated calls) to create manual and automatic campaigns for every moment of the player life cycle, using bonus rewards and top tier content.

The graphic below depicts the integration and orchestration capabilities of the Codere Group's platform, including the expected improvements referred to above.

![](img_001.jpg)

(1) Includes technology and operating capabilities provided by the Codere Group (on an exclusive basis within the Codere Group, subject to certain exceptions) pursuant to the New Platform and Technology Services Agreement.

(2) AI predictive risk segmentation work in progress.

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In addition to implementing Codere Online's pricing strategy, the Codere Group's Trading and Risk team receives, reviews and compares the odds received by third-party feed providers to Codere Online's strategy and informs management on the risk assumed as a result of the accumulated amount of bets in the event that they exceed the amounts established as per risk management parameters in place at the time. Furthermore, the Codere Group's traders continuously monitor competitor pricing across a wide range of sporting events to ensure that Codere Online's betting markets are competitive.

The below operational flow chart summarizes the trading and risk management functions undertaken by the Codere Group with respect to Codere Online's online sports betting operations through its platform.

![](img_002.jpg)

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**Our Markets**

*Spain*

Codere Online started its online gaming business in Spain in 2014 and launched its mobile app in 2016. The current online casino and online sports betting product offering in this market includes slots, video bingo, table games (including live) and sports betting (pre-match and live). Codere Online had approximately 50 thousand, 42 thousand and 38 thousand average monthly active players in this market in 2024, 2023 and 2022, respectively, of which a majority accessed its products via mobile, desktop and, to a lesser extent, tablet devices.

The Codere Group has been the official betting sponsor of Real Madrid since 2016. In April 2019, it renewed its sponsorship agreement with Real Madrid for the following three seasons, with the option to renew it through two additional one-year extensions, subject to certain conditions. Nonetheless, on November 24, 2020, the RM Sponsorship Agreement was amended and terminated in respect of Spain only (without prejudice to the agreement remaining in force in the remaining applicable jurisdictions) at the end of the 2020/2021 football season due to newly-enacted advertising legal restrictions (which affect sponsorship) in Spain. On October 7, 2021, the RM Sponsorship Agreement was further amended to, among other things, extend the term of the RM Sponsorship Agreement for four (4) additional football seasons, until June 30, 2026 (with either party having a right to terminate the agreement at the end of the 2022-2023 football season) and amend the applicable territory to only include Mexico, South America, Central America, Puerto Rico and Dominican Republic. The Codere Group has forged a strong relationship with Real Madrid in these last years and is currently exploring new avenues of collaboration in the future. Codere Online benefits from and has use rights to the existing, and any future amended, sponsorship agreement with Real Madrid. See the section entitled Item 7.B. "*Related Party Transactions*—*Material Agreements—Sponsorship and Services Agreement.*"

Online gaming legislation was enacted at the national level in 2012 and the Spanish gaming regulator is DGOJ. Online operators in Spain must be based in the Spanish territory or otherwise be domiciled in the European Union and must apply for two licenses: a general license for the development of a betting business, and a game-specific license, which is required to operate each type of game, such as slots, blackjack, American or French roulette and poker. The general license is for a ten (10)-year term and the game-specific license is for a minimum of one (1)-year term and a maximum of a five (5)-year term and are renewable for another equivalent period (that is, ten (10) or one (1) to five (5) years, as applicable). Furthermore, each autonomous region has the power to regulate gaming, including online gaming, within its region.

Codere Online's general licenses were granted in June 2012 for a period of ten (10) years and were extended for ten (10) additional years (until May 31, 2032). According to the DGOJ, there were 77 active national licenses in the Spanish national online gaming market as of December 31, 2024. Operators mainly offer seven different game types: bingo, poker, roulette, black jack, baccarat, complementary games and slots.

In 2024, the gross gaming revenue for the market was approximately €1,455 million, which represents a 14% CAGR between 2020 and 2024. The following table sets forth the development of online gaming in terms of gross gaming revenue and the CAGR for that period:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **CAGR %** |
|  | **2024** | **2023** | **2022** | **2021** | **2020** | **(2020 to 2024)** |
|  | **(In millions of euros)** | **(In millions of euros)** | **(In millions of euros)** | **(In millions of euros)** | **(In millions of euros)** |  |
| Casino | 846 | 744 | 602 | 506 | 478 | 15.31% |
| &nbsp;&nbsp;&nbsp;Casino (excl. Bingo and Poker) | 731 | 625 | 498 | 407 | 351 | 20.08% |
| &nbsp;&nbsp;&nbsp;Bingo | 15 | 14 | 14 | 14 | 17 | (3.08)% |
| &nbsp;&nbsp;&nbsp;Poker | 100 | 105 | 90 | 85 | 110 | (2.35)% |
| Sports betting | 609 | 492 | 360 | 306 | 365 | 13.65% |
| Other | 0 | 0 | 0 | 2 | 8 |  |
| **Total online gaming** | **1455** | **1236** | **962** | **814** | **851** | **14.32%** |

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*Source: DGOJ, National online gaming market report as of December 31, 2024*

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In recent years, advertising expenditures increased mainly driven by TV campaigns and Spanish "La Liga" (football) team sponsorships. Many operators, including Codere Online, signed sponsorship agreements with football clubs. The advertising restrictions set forth in the Advertising Decree have led to a sharp decrease in this type of expenditures and the agreements signed with the various football clubs had to be terminated by the end of the 2020/21 season.

The Advertising Decree, among other laws, forbids gambling companies from appearing on uniform shirts of football clubs and sponsoring their stadium names, and limits advertising on television to a four-hour window (from 1 a.m. to 5 a.m). However, certain aspects of the Advertising Decree were deemed unconstitutional by the Spanish supreme court. See Item 3.D. "*Risk Factors—Risks Related to Codere Online— The online gaming industry is subject to extensive regulation (including applicable direct and indirect taxation, anti-corruption, anti-money laundering and economic sanctions laws) as well as licensing requirements. Codere Online's business may be adversely affected if it is unable to comply with regulations or licensing requirements or any regulatory changes*" for more information on the Advertising Decree and supreme court decision.

The following table sets forth information on the approximate average monthly active and new online gaming users in the Spanish market for the years indicated:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **CAGR %** |
|  | **2024** | **2023** | **2022** | **2021** | **2020** | **(2020 to 2024)** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |  |
| Active accounts | 1720 | 1161 | 1057 | 991 | 872 | 13.76% |
| New accounts | 182 | 113 | 115 | 217 | 289 | (7.28)% |

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*Source: DGOJ, National online gaming market report as of December 31, 2024*

In 2018, the Spanish Government set a flat tax rate of 20% on gross win for all forms of online gambling. This tax is reduced to 10% for those entities domiciled in the autonomous cities of Ceuta and Melilla, such as CDON, which is domiciled in Melilla. Players are required to declare any winnings over €1,600 and pay income tax on it.

*Mexico*

Mexico is the largest gaming market in Latin America and includes land-based and online gaming. Codere Online started its online operations in Mexico in 2016, followed by a full commercial launch in 2019. The current online casino and online sports betting product offering in this market includes slots, video bingo, table games (including live) and sports betting (pre-match and live). Codere Online had approximately 64 thousand, 52 thousand and 38 thousand average monthly active players in this market in 2024, 2023 and 2022, respectively, of which a majority accessed its products via mobile, desktop and, to a lesser extent, tablet devices.

Despite having one of the oldest regulatory frameworks for gaming operations, Mexican regulations have evolved to allow for new forms of gaming, including online, and local authorities have interpreted that license holders are allowed to take online bets. Mexican authorities passed new gaming regulation to replace the archaic 1947 law in order to, among others, regulate online gaming. The new law was passed by the Chamber of Deputies in December 2014, but it has not been considered by the Senate. Nonetheless, based on a 2004 regulatory decree, the Mexican regulator, *Secretaría de Gobernación* (SEGOB), awarded several online licenses to local licensed land-based operators that allow online gaming since 2016, but to qualify for a license, operators must operate a retail establishment in Mexico. Codere Online does not own a license but rather operates through an "*Asociación en Participación*" or "AenP" (an unincorporated joint venture) with LIFO, a wholly-owned subsidiary of the Codere Group, under which Codere Online, through SEJO, operates online gaming and is entitled to receive 99.99% of any distributed profits whereas LIFO is entitled to receive the remaining 0.01% of any such distributed profits. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*AenP Agreement*" for additional information on the agreement with LIFO.

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The LIFO License expires in May 2027. Although Codere Online is not aware of reliable publicly available data regarding the number of licensed operators in Mexico, it estimates that there are over 25 online gaming operators in the country, including Caliente, Bet365, PlayCity, Playdoit and Betcris. According to Codere Online's estimates, Caliente is the largest online operator in Mexico, followed by Codere Online and Bet365, with the remainder of competitors lacking a significant market share. The LIFO License could be automatically revoked if LIFO were to file for insolvency protection. There can be no assurance that Codere Online would maintain or be able to renew the LIFO License in the event of insolvency or other financial difficulty, including upon the filing or declaration of insolvency of Codere Newco, Codere, S.A. (the former parent company of the Codere Group) or Codere Group Topco S.A. (the current parent company of the Codere Group), as such filing or declaration may be perceived to adversely affect the solvency of Codere Online as well. See also "*—Regulation Applicable to Codere Online's Business—Gambling and Gaming Regulation by Country—Mexico"* and *Item 3.D. "Risk Factors—Risks Related to Codere Online—Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business"* for more information regarding the Mexico Gaming Decree and its potential effect on the renewal of our existing licenses.

The following table sets forth the development of online gaming in Mexico in terms of gross gaming revenue and the CAGR for the 2020–2024 period:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **CAGR %** |
|  | **2024** | **2023** | **2022** | **2021** | **2020** | **(2020 to 2024)** |
|  | **(In millions of MXN)** | **(In millions of MXN)** | **(In millions of MXN)** | **(In millions of MXN)** | **(In millions of MXN)** |  |
| Casino | 18456 | 14361 | 6073 | 5636 | 4447 | 44% |
| &nbsp;&nbsp;&nbsp;Casino (excl. Bingo and Poker) | 17038 | 13023 | 5441 | 4992 | 3778 | 46% |
| &nbsp;&nbsp;&nbsp;Bingo | 326 | 322 | 158 | 158 | 154 | 26% |
| &nbsp;&nbsp;&nbsp;Poker | 1092 | 1016 | 474 | 486 | 514 | 27% |
| Sports betting | 13908 | 10298 | 5944 | 4248 | 3473 | 35% |
| **Total online gaming** | **32364** | **24659** | **12017** | **9884** | **7919** | **40%** |

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*Source: H2 Gambling Capital, onshore revenue only, as of April 9, 2025*

*Colombia*

The Colombian gaming market includes land-based and online casino and online sports betting. Colombia was the first Latin American country to introduce nationwide European-style online gambling regulation in 2015. Codere Online started operating in Colombia in 2018. The current online casino and online sports betting product offering in this market includes online slots, video bingo, table games (including live) and online sports betting (pre-match and live). Codere Online had approximately 30 thousand, 24 thousand and 29 thousand average monthly active players in this market in 2024, 2023 and 2022, respectively, of which a majority accessed its products via mobile, and desktop.

Online gaming is regulated by the Colombian gaming regulator, Coljuegos, under the definition of "novelty games." In October 2016, the Colombian Government approved the "eGaming Act" formally liberalizing a wide range of online products including online casino, sports betting, and poker, making Colombia the first Latin American country to establish a detailed regulatory framework for the operation of online gaming. Coljuegos was entrusted with the licensing process and enforcement of the new regulations.

In November 2017, Codere Colombia, S.A., a subsidiary of the Codere Group, was issued the Colombia License for an initial period of five (5) years until November 15, 2022. On December 21, 2021, the transfer of the Colombia License to Codere Online Colombia S.A.S. was formally requested pursuant to Agreement 08/2020 and Resolutions No. 20161200025334, 20164000029574 of 2016 and 20201000008294 of 2020. The transfer request was approved by Coljuegos on July 1, 2022 and Codere Online Colombia S.A.S. began operating the online business in Colombia under the Colombia License on September 1, 2022. On September 2, 2022, an application for the renewal of the Colombia License was submitted to Coljuegos. On November 10, 2022, Coljuegos renewed the Colombia License until November 14, 2025. Codere Online is currently in the process of renewing the Colombia License.

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Prior to the effective transfer of the Colombia License, the relevant entities of the Codere Group and the Codere Online group, respectively, exploited the license under the Joint Accounts Agreement (*contrato de cuentas en participación*) (as defined herein), pursuant to which Codere Online had the right to receive 99.00% of any distributed profits. The agreement was automatically terminated upon approval of the transfer of the Colombia License by Coljuegos. See the section entitled Item 7.B. "*Related Party Transactions*—*Material Agreements*" for additional information.

According to Coljuegos, in December 2024, there were 15 authorized licensed online gaming operators in Colombia, including Bwin, Sportium, Codere, Luckia and Rush Street.

The following table sets forth the development of online gaming in Colombia in terms of gross gaming revenue and CAGR for the 2020–2024 period:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **CAGR %** |
|  | **2024** | **2023** | **2022** | **2021** | **2020** | **(2020 to 2024)** |
|  | **(In millions of COP)** | **(In millions of COP)** | **(In millions of COP)** | **(In millions of COP)** | **(In millions of COP)** |  |
| Casino | 910297 | 718618 | 620289 | 696537 | 310889 | 36% |
| &nbsp;&nbsp;&nbsp;Casino (excl. Bingo and Poker) | 894790 | 706376 | 601680 | 434284 | 201820 | 47% |
| &nbsp;&nbsp;&nbsp;Bingo |  |  |  | 72787 | 18197 | n.m |
| &nbsp;&nbsp;&nbsp;Poker | 15507 | 12242 | 18609 | 189466 | 90872 | (25)% |
| Sports betting | 2026145 | 1507430 | 1029152 | 793863 | 317084 | 50% |
| **Total online gaming** | **2936442** | **2226048** | **1649441** | **1490400** | **627973** | **45%** |

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*Source: H2 Gambling Capital, onshore revenue only, as of April 9, 2025*

*Panama*

Panama's gaming market includes land-based and online casino and online sports betting. Codere has offered Online Sport Betting in Panama since 2017. The current online product offering in this market is limited to sports betting (pre-match and live). Codere Online had approximately 5,600, 4,500 and 3,200 average monthly active players in this market in 2024, 2023 and 2022, respectively.

Online gaming was first authorized in 2002 and was initially limited to foreign-facing websites, which are barred from serving Panamanian citizens. The Panamanian regulator is the Panama Gambling Control Board. Resolution No. 236 dated March 21, 2016, allows land-based operators to capture wagering on international sports events through the Internet from retail registered customers, provided that a previous authorization is granted by the Panama Gaming Control Board. Resolution No. 11 dated March 6, 2020 provided for the issuance of standalone online gaming licenses (allowing for both casino and sports betting). In May 2021, ALTA, a subsidiary of the Codere Group, was awarded the ALTA License for a 20-year term to conduct online gaming operations in Panama starting on December 1, 2021, subject to compliance with certain requirements. As described under Item 7.B. "*Related Party Transactions*—*Material Agreements—Panama Restructuring Agreements*", Codere Online may request the transfer of the ALTA License from ALTA to Codere Online, but such transfer is subject to the authorization from the Panama Gambling Control Board. Until the ALTA License is transferred to Codere Online, Codere Online will operate the ALTA License under the agreement that Codere Online Panama and ALTA entered into on December 1, 2021.

To Codere Online's knowledge, there are at least four other licensed online gaming operators in Panama: Betcris, Betcha, Sportium and Starplay.

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The following table sets forth the development of online gaming in Panama in terms of gross gaming revenue:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year ended December 31,** | **Year ended December 31,** | **Year ended December 31,** | **Year ended December 31,** | **Year ended December 31,** | **CAGR %** |
|  | **2024** | **2023** | **2022** | **2021** | **2020** | **(2019 to 2024)** |
|  | **(In millions of USD)** | **(In millions of USD)** | **(In millions of USD)** | **(In millions of USD)** | **(In millions of USD)** |  |
| Casino | 7.2 | 4.80 | 22.3 | 16.9 | 5.2 | n.m. |
| &nbsp;&nbsp;&nbsp;Casino (excl. Bingo and Poker) | 6.5 | 4.3 | 18.0 | 13.6 | 4.1 | n.m. |
| &nbsp;&nbsp;&nbsp;Bingo | 0.3 | 0.2 | 3.2 | 2.5 | 0.8 | n.m. |
| &nbsp;&nbsp;&nbsp;Poker | 0.4 | 0.3 | 1.1 | 0.8 | 0.3 | n.m. |
| Sports betting | 13.0 | 9.8 | 22.5 | 15.8 | 7.0 | n.m. |
| **Total online gaming** | **20.2** | **14.6** | **44.8** | **32.7** | **12.2** | n.m. |

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*Source: H2 Gambling Capital, offshore (2020) and onshore (2021 onwards) revenue, as of December 31, 2024*

*Argentina*

Argentina is one of the largest gaming markets in Latin America. The gaming industry in Argentina consists of lotteries, gaming halls and horse racetracks. In October 2020, Codere Online was the first online operator to receive regulatory approval from the City of Buenos Aires' regulator for its proposed platform implementation program, which was a first step towards being awarded a full online betting and casino license in the City of Buenos Aires, as described below. Codere Online had approximately 3,300 and 4,600 average monthly active players in this market in 2024 and 2023, respectively.

In Argentina, gaming is regulated at the provincial rather than federal level. A few provinces, including Buenos Aires, Santa Fe, Córdoba, Santa Cruz, Neuquén, Chubut, San Luis, La Pampa, Misiones, Corrientes, Entre Ríos, Río Negro, Mendoza and Tucumán, have issued online gaming regulation. There are increasing initiatives from the State Lotteries and Casinos Association (ALEA) to issue federal regulation based on European models.

Online legislation in the City of Buenos Aires was enacted in 2018, and the regulator and exclusive holder of the rights to exploit online gaming within the City of Buenos Aires is *Lotería de Buenos Aires* (LOTBA). LOTBA launched a process in 2020 to grant permits to distribute and commercialize online gaming within the City of Buenos Aires. In March 2021, LOTBA granted the Buenos Aires License to Iberargen S.A., a subsidiary of the Codere Group, for a period of five (5) years and, in December 2021, authorized Iberargen, S.A. to operate in the City of Buenos Aires thereunder. Pursuant to the Business Combination Agreement and the Argentina Restructuring Agreement, the Codere Group would seek to transfer the Buenos Aires License granted to Iberargen S.A. to Codere Online subject to LOTBA granting the required authorization. Pending LOTBA's authorization of the transfer of the Buenos Aires License to Codere Online, Iberargen, S.A. agreed to exploit such license pursuant to the instructions of Codere Online Argentina, S.A., and any resulting expenses and income would be assigned to Codere Online Argentina, S.A. On May 3, 2023, LOTBA authorised the transfer of the Buenos Aires License to Codere Online.

On April 12, 2023, Codere Online (through a Temporary Union Contract (*contrato de unión transitoria*) 92.2%-owned by Codere Online) signed an online gaming license agreement with the local authority (*Instituto Provincial de Juegos y Casinos*, "IPJC") in the Province of Mendoza in Argentina pursuant to which Codere Online is authorized to operate its online gaming business in the Province of Mendoza for a term of 10 years. This agreement followed the award of an online gaming license to Codere Online and several other operators pursuant to Resolution 192/2023 of the IPJC on April 3, 2023. On December 5, 2023, Codere Online and Cela, S.A. (local partner and owner of a 2% stake of the Temporary Union Contract) entered into a collaboration agreement for the operation of online gaming in the Province of Mendoza, where Codere Online started to operate in May 2024.

Codere Online is not aware of reliable publicly available data regarding the online gaming activity in the City of Buenos Aires or the Province of Mendoza in Argentina.

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**Intellectual Property**

Pursuant to the Relationship and Licensing Agreement, as of October 25, 2021 Codere Group assigned to Codere Online the following internet domains, from which it operates its online business in the different territories it is licensed to do so: codere.es, codere.mx, codere.pa, codere.com.co and codere.bet.ar. Additionally, Codere Online's intellectual property portfolio consists substantially of licensed intellectual property, including the "Codere" trademarks licensed pursuant to the Relationship and License Agreement, which agreement is described in Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement."* Pursuant to such agreement, Codere Newco has granted Codere Online, subject to certain limitations and exemptions, an exclusive, sublicenseable and non-transferable license to use certain "Codere" trademarks (and other trademarks related to Codere Online's business) and domain names. In addition, pursuant to the Sponsorship and Services Agreement, Codere Online became the licensee of certain rights, marks, names, images, designations, anthems, photographs and brands set forth under the RM Sponsorship Agreement, as well as the licensee or assignee, as applicable, of new sponsorship rights under sponsorship agreements entered into by Codere Newco and certain of its affiliates as negotiated and agreed between SEJO and Codere Newco from time to time (see Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Sponsorship and Services Agreement*"). Furthermore, Codere Newco is the licensee of certain additional intellectual property under the New Platform and Technology Services Agreement, which agreement is described in Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Platform and Technology Services Agreement."*

Codere Online licenses certain third-party intellectual property (such as games) under licenses and service agreements with those third parties, including through agreements with gaming content creators and service providers. Although Codere Online believes the licenses under the Relationship and License Agreement, the Sponsorship and Services Agreement, the New Platform and Technology Services Agreement and these third-party agreements will be sufficient for the operation of Codere Online's business in the foreseeable future, these licenses limit the use of the licensed intellectual property in specific manners and for specific time periods and Codere Online relies entirely on such rights granted by third parties or affiliates to operate its business. Codere Online may also rely in part on the counterparties to the Relationship and License Agreement, the Sponsorship and Services Agreement, the New Platform and Technology Services Agreement and such other third-party agreements to appropriately register, protect and defend the licensed intellectual property.

Codere Online's online gaming offering consists of a combination of licensed content from leading suppliers in the industry. Third-party content is subject to standard revenue-sharing agreements specific to each supplier, whereby the supplier receives a percentage of the gaming revenue generated from the games played on Codere Online's platform. In exchange, Codere Online receives a limited license to offer the games on its platform to users in jurisdictions where use is approved by the regulatory authorities.

**Government Regulation**

Codere Online is subject to various laws and regulations. For summary information on certain laws and regulations affecting Codere Online's business, see "—*Regulation Applicable to Codere Online's Business*."

**Compliance**

Codere Online has a robust internal compliance program designed to ensure that it complies with legal and regulatory requirements, including with regard to money laundering prevention in connection with its online casino and online sports betting activities. Additionally, Codere Online employs various methods and tools across its operations such as geolocation blocking, which restricts access based upon the user's geographical location determined through a series of data points such as mobile devices and Wi-Fi networks; age verification to ensure its users are old enough to participate; routine monitoring of user activity; and risk-based user due diligence to ensure the funds used by its users are legitimately derived. Codere Online has a zero-tolerance approach to fraud and collusion.

In accordance with anti-money laundering laws and regulations, Codere Online adopts and implements control policies and procedures that comply with the applicable regulations and reports suspicious transactions to the applicable regulatory authorities.

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Anti-money laundering, corruption and bribery are among the risks Codere Online faces in the course of its activity. With the aim of combatting and preventing this problem, in addition to the policies adopted at a Codere Group level, Codere Online has its own Anti-corruption, Anti-fraud, Conflict of Interest and Whistleblower Channel policies, which are accessible through Codere Online's corporate website. The reference to Codere Online's website address in this annual report does not include or incorporate by reference the information on Codere Online's website into this annual report.

Codere Online's platform has been built from the ground up to meet the needs of differing regulatory regimes, including configurable regulatory and responsible gaming controls such as responsible gaming tests, operator alerts on player behavior, deposit limits, betting limits, loss limits, session limits, reality checks, balance thresholds and intended gaming amounts. These features allow the operators' customers control of their gaming to allow them to play responsibly.

**Responsible and Safer Gaming**

Codere Online views the safety and welfare of its users as critical to its business. Codere Online is committed to industry-leading responsible gaming practices and seeks to provide its users with the resources and services they need to play responsibly. These practices, resources and services include deposit limits, voluntary restrictions on access and use of certain offerings, temporary self-exclusion and cooling-off periods, voluntary permanent exclusion from Codere Online's offerings and applications and data science technology, which is able to flag any suspicious or abnormal betting activity. Codere Online prominently promotes its responsible gaming tools, resources and initiatives on its websites and mobile applications, which are supported by an established and flexible technology platform. Codere Online also maintains a self-excluded user list, which prohibits self-identified users from placing bets or participating in real-money gaming and have embedded the software to limit or restrict the amount individual users spend. Codere Online also trains its frontline personnel to identify signs of problematic gaming, ensuring that it is not only utilizing data and technology but also its human resources.

In Spain, members of the gaming sector (representing approximately 70% of gaming activity sector-wide) founded Cejuego, Spain's leading gaming trade association, with the aim of providing additional information about the industry and its customers to the public and confront existing perceptions with real data and facts. The Codere Group has been a member of Cejuego since 2018 and keeps a constant dialogue with key interest groups. Additionally, in 2019, Codere Online joined Jdigital, the Spanish Association for Digital Gaming, reinforcing its commitment to responsible gaming and to developing its business in a way that minimizes the social impact of its entertainment offerings through the implementation of best practices, transparency and collaboration with regulators.

Codere Online's commitments to responsible gaming are based on four main principles: transparency, education, information and self-exclusion. To these ends, the Codere Group, together with Codere Online, has established and continues to develop responsible gaming programs in accordance with its Corporate Social Responsibility Policy. The Codere Group is currently developing specific programs centered around cooperation with communities, associations and non-profit organizations, through donations, volunteer programs and trainings.

**Competition**

In the online casino and online sports betting space, which is vast and rapidly expanding, Codere Online considers any company competing for the time and disposable income of customers within the markets in which it operates to be a competitor, including retail casino and sports betting companies. In addition, there are several gaming companies in Spain and Latin America that currently provide online casino, online sports betting, or both, including, but not limited to, 888, Bet365, Betcris, Caliente, Entain, Flutter, Rush Street, Sportium and William Hill.

Codere Online believes the principal competitive factors in the business include reliability, brand recognition, product offering, the ability to acquire and retain users, regulatory compliance, market access, customer service and innovation.

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**Agreements with the Codere Group**

Codere Online has entered into several agreements with other members of the Codere Group, including the Sponsorship and Services Agreement, the Relationship and License Agreement, the AenP Agreement, the New Platform and Technology Services Agreement and the Restructuring Agreements*.* For information on the main terms of such agreements, see Item 7.B. "*Related Party Transactions*." Codere Online believes that its relationship with the Codere Group will be beneficial to Codere Online and in furtherance of its goal to maximize value for its stake holders.

**Employees**

See Item 6.D. "*Employees.*"

**Legal Proceedings**

From time to time, Codere Online may be involved in various legal proceedings and subject to claims that arise in the ordinary course of business or otherwise. Codere Online may be and in some cases has been subject to claims, lawsuits, government or regulatory investigations, subpoenas, inquiries or audits, and other proceedings involving areas such as online gambling regulation, intellectual property, consumer protection, privacy, data protection, labor and employment, immigration, import and export practices, product labelling, competition, accessibility, securities, tax, marketing and communications practices, commercial disputes, anti-fraud, anti-money laundering, anti-corruption, counter-terrorist financing, sanctions, related civil and criminal litigation and other matters. Any of the foregoing could result in the imposition of civil, administrative and criminal penalties and sanctions on Codere Online and could affect Codere Online's ability to renew any of its licenses, including the CDON Licenses, which, individually or in the aggregate, could have a material adverse effect on Codere Online's business, results of operations and financial condition.

In 2023, CDON received two sanctions from the DGOJ of €125,000 each (reduced to €75,000 for prompt payment and assumption of liability) for breaches of regulatory obligations, including failing to prevent, for a period of 24 hours, the online gaming activities of one individual who was listed in the Spanish general register of gaming access bans. In 2024, CDON received a sanction from the DGOJ of €100,000 (reduced to €60,000 for prompt payment and assumption of liability) for a serious breach of the Advertising Decree, related to promotional material published on one of the CDON's social media platforms in 2022.

CDON has filed fraud complaints in several instances involving identity theft and the creation of simulated customer accounts to benefit from Codere Online's commercial promotions and marketing efforts. For example, in 2020, CDON filed a claim against a third party who allegedly placed bets using promotional bonuses (i.e., credits) obtained from simulated new customer accounts that had been created to fraudulently benefit from Codere Online's commercial promotions designed to attract new customer registrations.

Furthermore, Codere Online, directly or through its subsidiaries, has filed criminal complaints in Spain and is the plaintiff in such criminal proceedings for various offenses, including fraud, identity theft, money laundering, corruption in sports and belonging to a criminal organization.

Except as disclosed above, Codere Online is not currently a party to any legal proceedings the outcome of which, if determined adversely to Codere Online, are believed by it to, either individually or taken together, have a material adverse effect on its business, operating results, cash flows or financial condition. Regardless of the outcome, litigation has the potential to have an adverse impact on Codere Online because of defense and settlement costs, diversion of management resources, and other factors.

**Regulation Applicable to Codere Online's Business**

Codere Online is subject to various laws and regulations that affect its ability to operate in the online casino gaming and online sports betting industries. These industries are generally subject to extensive and evolving regulations that could change based on political and social norms and that could be interpreted in ways that could negatively impact Codere Online's business. The below summary is not intended to be exhaustive or comprehensive and there are other laws and regulations that affect Codere Online's business.

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The gaming industry, which includes online casino gaming and online sports betting, is heavily regulated and in order to continue its operations, Codere Online must maintain licenses and pay gaming taxes or a percentage of revenue in each jurisdiction in which it operates. Codere Online's business is subject to extensive regulation under the laws, rules and regulations of the jurisdictions in which it operates. These laws, rules and regulations generally concern the responsibility, financial stability, integrity and character of the owners, managers and persons with material financial interests in gaming operations, along with the integrity and security of Codere Online's online casino gaming and online sports betting offerings. Violations of laws or regulations in one jurisdiction could result in disciplinary action in that and other jurisdictions.

Gaming laws are generally based upon declarations of public policy designed to protect gaming consumers and the viability and integrity of the gaming industry. Gaming laws also may be designed to protect and maximize state and local tax revenues, as well as to enhance economic development and tourism. To accomplish these public policy goals, gaming laws establish stringent procedures to ensure that participants in the gaming industry meet certain standards of character and responsibility. Among other things, gaming laws may require gaming industry participants to, among others:

● ensure that unsuitable individuals and organizations have no role in gaming operations;

● establish procedures designed to prevent cheating and fraudulent practices;

● establish and maintain anti-money laundering practices and procedures;

● establish and maintain responsible accounting practices and procedures;

● maintain effective controls over their financial practices, including establishing minimum procedures for internal fiscal affairs and the safeguarding of assets and revenues;

● maintain systems for reliable record keeping;

● file periodic reports with gaming regulators;

● establish programs to promote responsible gaming; and

● enforce minimum age requirements.

Typically, a national or regional regulatory environment is established by statute and underlying regulations and is administered by one or more regulatory agencies which regulate the affairs of owners, managers and persons with financial interests in gaming operations. Among other things, gaming authorities in the various jurisdictions in which Codere Online conducts or intends to conduct its business may:

● adopt rules and regulations under the implementing statutes;

● interpret and enforce gaming laws and regulations;

● impose fines and penalties for violations;

● review the character and fitness of participants in gaming operations and make determinations regarding their suitability or qualification for licensure;

● grant licenses for participation in gaming operations;

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● collect and review reports and information submitted by participants in gaming operations;

● review and approve certain transactions, which may include acquisitions or change-of-control transactions of gaming industry participants and securities offerings and debt transactions in which such participants engage; and

● establish and collect fees and taxes in jurisdictions where applicable.

While Codere Online believes that it is in compliance in all material respects with all applicable online casino gaming and online sports betting laws, licenses and regulatory requirements, Codere Online cannot assure that its activities or the activities of its users will not become the subject of any regulatory, tax or law enforcement investigation, proceeding or other governmental action or that any such proceeding or action, as the case may be, would not have a material adverse impact on Codere Online or its business, results of operations and financial condition.

*Licensing and suitability determinations*

In order to operate in certain jurisdictions, Codere Online must obtain either a temporary or permanent license or determination of suitability from the responsible authorities. Some of such jurisdictions require operators to operate through retail establishments in order to qualify for an online license. Codere Online seeks to ensure that it obtains all necessary licenses to develop and put forth its offerings in the jurisdictions in which it operates and where its users are located.

Gaming laws require Codere Online and may require each of its subsidiaries engaged in gaming operations, and certain of its directors, officers and employees and, in some cases, certain of its shareholders to be found suitable by gaming authorities. Licenses and suitability findings require a determination that the applicant is qualified. Where not mandated by statute, rule or regulation, gaming authorities typically have broad discretion in determining who must apply for a license or finding of suitability and whether an applicant qualifies for licensing or should be deemed suitable to conduct operations within a given jurisdiction. When determining to grant a license to an applicant, gaming authorities generally consider: (i) the financial stability, integrity, responsibility and suitability of the applicant and its applicable affiliated entities and individuals (including verification of the applicant's sources of funding); (ii) the quality and security of the applicant's online real-money gaming platform, hardware and related software, including the platform's ability to operate in compliance with local regulation, as applicable; (iii) the applicant's history; (iv) the applicant's ability to operate its gaming business in a socially responsible manner; and (v) in certain circumstances, the effect on competition.

Gaming authorities may, subject to certain administrative procedural requirements, (i) deny an application, or limit, condition, revoke or suspend any license issued, or suitability finding made, by them; (ii) impose fines, either on a mandatory basis or as a consensual settlement of regulatory action; (iii) demand that named individuals or shareholders be disassociated from a gaming business; and (iv) in serious cases, liaise with local prosecutors to pursue legal action, which may result in civil or criminal penalties.

Events that may trigger revocation of a gaming license or another form of sanction vary by jurisdiction. However, typical events include, among others: (i) conviction in any jurisdiction of certain persons with an interest in, or key personnel of, the licensee of an offense that is punishable by imprisonment or may otherwise cast doubt on such person's integrity; (ii) failure to comply with any material term or condition of the gaming license; (iii) declaration of, or otherwise engaging in, certain bankruptcy, insolvency, winding-up or discontinuance activities, or an order or application with respect to the same; (iv) obtaining the gaming license by a materially false or misleading representation or in some other improper way; (v) violation of applicable anti-money laundering or terrorist financing laws or regulations; (vi) failure to meet commitments to users, including social responsibility commitments; (vii) failure to pay in a timely manner all gaming or betting taxes or fees due; or (viii) determination by the gaming authority that there is another material and sufficient reason to revoke or impose another form of sanction upon the licensee. For example, in Mexico, the LIFO License could be automatically revoked if LIFO were to file for insolvency protection. There can be no assurance that Codere Online would maintain or be able to renew its licenses in the event of insolvency or other financial difficulty, including upon the filing or declaration of insolvency of Codere Newco or the parent company of the Codere Group from time to time, as such filing or declaration may be perceived to adversely affect the solvency of Codere Online as well.

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As noted above, in addition to Codere Online and its direct and indirect holding companies and subsidiaries, gaming authorities generally also have the right to investigate individuals or entities having a material relationship to, or material involvement with, Codere Online or any of its affiliates, to determine whether such individual or entity is suitable as a business associate. Specifically, as part of Codere Online's obtaining online casino gaming and online sports betting licenses, certain of Codere Online's officers, directors, and employees and in some cases, certain of its shareholders (typically, beneficial owners of more than 5% of a company's outstanding equity, with most jurisdictions providing that "institutional investors" (as defined by a particular jurisdiction) can seek a waiver of these requirements) may be required to file applications with the gaming authorities and may be required to be found suitable in certain jurisdictions. Qualification and suitability determinations generally require the submission of extensive and detailed personal and financial disclosures followed by a thorough investigation. The applicant must pay all the costs of the investigation. Changes with respect to the individuals who occupy licensed positions must be reported to gaming authorities and in addition to the authority to deny an application for licensure, qualification, or a finding of suitability, gaming authorities have jurisdiction to disapprove a change in a corporate position. If any director, officer, employee or significant shareholder is found unsuitable (including due to the failure to submit required documentation) by a gaming authority, Codere Online may deem it necessary, or be required, to sever its relationship with such person.

Generally, any person who fails or refuses to apply for a finding of suitability or a license within the prescribed period after being advised that it is required by gaming authorities may be denied a license or found unsuitable, as applicable. Furthermore, Codere Online may be subject to disciplinary action or its licenses may be in peril if, after it receives notice that a person is unsuitable to be a stockholder or to have any other relationship with Codere Online or any of its subsidiaries, Codere Online: (i) pays that person any dividend or interest upon its voting securities; (ii) allows that person to exercise, directly or indirectly, any voting right conferred through securities held by that person; (iii) pays remuneration in any form to that person for services rendered or otherwise; or (iv) fails to pursue all lawful efforts to require such unsuitable person to relinquish its voting securities.

*Data protection and privacy*

Because Codere Online handles, collects, stores, receives, transmits and otherwise processes certain personal information of its users and employees, Codere Online is also subject to national and international laws related to the privacy and protection of such data. The collection and use of personal data is governed by privacy laws and regulations enacted in various jurisdictions in which Codere Online operates. Privacy regulations continue to evolve in each of the markets served by Codere Online. Nevertheless, Codere Online has an internal data protection and privacy program designed to ensure that it complies with its legal and regulatory requirements and focuses its efforts and vision on constantly adapting to the different jurisdictions and regulatory environments where it operates, even though these may differ from one another.

***Gambling and Gaming Regulation by Country***

*Spain*

Codere Online operates online gaming in Spain pursuant to the following online licenses granted by the DGOJ, the Spanish gaming regulator, to CDON: (A) three (3) general licenses for a ten (10) year term which were extended for ten (10) additional years (until May 31, 2032): (i) Other Games License, (ii) Betting License and (iii) Contests License; and (B) six (6) singular licenses for: (i) slots (renewed until December 12, 2029), (ii) roulette (renewed until December 12, 2027), (iii) black jack (renewed until December 12, 2027), (iv) sports betting (renewed until December 12, 2029), (v) horse betting (renewed until February 20, 2029) and (vi) other bets (renewed until December 12, 2029) (collectively, the "CDON Licenses").

Online gambling and other gaming activities are regulated along with other forms of gambling by the Spanish Gaming Law. Royal Decree 1614/2011, of November 14, implementing the Spanish Gaming Law, in relation to gambling licenses, permits and registers in order to facilitate access by the various operators to the activities covered by the Law also includes the procedure to obtain the authorization of reserved gambling activities. General licenses are granted after the corresponding public tender process and have a duration of ten (10) years, renewable for an identical period, unless they are specifically limited. The operation of each type of gambling included in the scope of each general license requires the granting of a specific operating license, regulated by Article 11 of the Law.

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Title IV of the Spanish Gaming Law establishes the minimum technical requirements established by the National Gambling Commission that must be met by the technical equipment in terms of sufficient authentication mechanisms to guarantee, inter alia, the following:

● Confidentiality and integrity in communications.

● The identity of the participants, in the case of gambling using telematic and interactive means, as well as the verification, in the terms established by law, that they are not included in the Register provided for in Article 22.1 b) of this Law.

● The authenticity and calculation of the bets.

● The control of their correct operation.

● Compliance with the subjective prohibitions regulated by Article 6 of this Law.

● Access to the components of the computer system exclusively by authorized personnel or by the National Gambling Commission itself, under the conditions that it may establish.

Royal Decree 1613/2011, of November 14, implementing the Spanish Gaming Law, provides the regulation of gambling in relation to the technical requirements of gambling activities, regulating the requirements of gambling activities carried out through websites.

● In order to market and carry out gambling activities through websites within the scope of the Spanish Gaming Law, operators must create a specific website under the «.es» domain name to which all connections made from Spain or made with a Spanish user account should be directed.

● The operator must establish the systems, mechanisms or agreements that guarantee that all gambling activities carried out from Spain or using a Spanish user account are handled from the operator's website under the «.es» domain name. In particular, the operator must guarantee that all connections made from Spain or by participants with Spanish user accounts and that were initially directed to websites under a domain other than the ".es," domain which are owned or controlled by the operator, its parent or its subsidiaries, are redirected to the operator's specific website under the «.es» domain.

● The operator shall notify the National Gambling Commission of the domain name and the relevant information and data on the website that it uses to carry on its activity, as well as any changes therein.

● Where it deems necessary for the protection of the public interest and of minors, the National Gambling Commission may establish that certain types of gambling be marketed and carried out from an exclusive website created for this purpose by the operator.

The Spanish Gaming Law has a decisive impact on sector legislation on advertising, protection of personal data and electronic commerce. These three disciplines include obligations related to the duties of online games, regulated by General Advertising Law 34/1988, of November 11, and Regulation (EU) 2016/679 of the European Parliament and of The Council of April 27, 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data; Organic Law 3/2018, of December 5, of Protection of Personal Data and guarantee of Digital Rights; and Law 34/2002, of July 11, on Services of the Information Society and Electronic Commerce. These measures provide, among others, that betting advertising will only be allowed between 1:00 am and 5:00 a.m. and advertisers using social networks may only broadcast adverts to their followers.

The Spanish Cabinet approved Royal Decree-Law 11/2020, of March 31, whereby urgent supplementary social and economic measures were adopted to respond to the coronavirus health crisis that led to the declaration of the state of emergency by Royal Decree 463/2020, of March 14. The new measures introduced by this Royal Decree included the updating of consumer protection measures in the context of the exceptional events caused by the COVID-19 pandemic. It was also essential to establish certain limitations within the framework of gambling regulations.

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Therefore, to avoid an increase in online gambling consumption (in particular, casino, bingo and poker games), which can lead to compulsive or even pathological consumption behaviors (especially to protect minors, young adults or people with gambling disorders at a time of greater exposure), restrictions were placed on commercial communications made by gambling operators with a nationwide reach, including entities designated for the marketing of lottery games. However, this particular measure was ultimately repealed by final provision 5.2 of Law 2/2021, of March 29.

The Advertising Decree, sets forth certain advertising restrictions and, among other things, forbids gambling companies from appearing on uniform shirts of football clubs and sponsoring their stadium names. On November 3, 2022, the Spanish Official Gazette published a new parliamentary act amending the Spanish Gambling Law.

On March 14, 2023, Royal Decree 176/2023 on Safer Gambling Environments was passed. This Royal Decree supplements Royal Decree 958/2020 on Commercial Communications of Gambling Activities regarding the responsible and safe gambling duties and supersedes the provisions related to responsible gambling (i.e., Articles 29 to 35 of the Advertising Decree). This Royal Decree emphasizes the responsible or safe gambling policies already contemplated in the Spanish Gaming Law and establishes special protection categories such as participants with intensive gambling behavior, young players or participants with risky gambling behaviors. The Royal Decree sets forth special protective measures that range from restricting the use of credit cards as opposed to debit cards by participants with intensive gambling behavior or participants with risky gambling behaviors, to the prohibition of treating young players (between 18 and 25 years old) as "VIP players". Operators are required to provide detailed information to players regarding their gaming behavior such as time played, amounts wagered and losses incurred. Certain provisions of this Royal Decree will enter into force on September 15, 2023 and the remaining provisions entered into force on March 15, 2024. Notwithstanding the foregoing, on April 10, 2024, the Spanish Supreme Court issued a ruling on the appeal filed by JDigital (an iGaming operators' association in Spain) against the Advertising Decree in which several provisions have been declared null and void on legal/constitutional grounds. The immediate consequences of this ruling are: (i) operators may now offer promotions to attract new customers; (ii) commercial communications related to promotions are no longer restricted to existing players, they can be sent to any user who is legally entitled to receive this sort of communication; (iii) operators may use celebrities / famous persons in their advertising materials; (iv) operators may advertise themselves through digital channels; (v) operators are no longer required to send commercial communications just to certain categories of eligible users of social media platforms, and (vi) operators are no longer required to restrict sending commercial communications through social media profiles focused on gambling and apply other restrictions that were contemplated in that respect in the Advertising Decree.

In the event an operator, like Codere Online, is undergoing sanctioning procedures or has received a sanction from the DGOJ in the past based on one or more of the voided provisions, it would be legally entitled to formally request the DGOJ to review its decision. It is still unclear what measures, if any, will be adopted by Codere Online or by other gaming operators in Spain in response to this ruling. There is a risk that the Spanish Government may decide to reintroduce the restrictions contemplated in the voided provisions of the Advertising Decree by approving them in a new piece of legislation.

On August 5, 2023, the DGOJ published a decision from July 18, 2023, amending several previous decisions which establishes, among others, that (i) operators must notify the DGOJ of the cancellation of user registrations, and (ii) operators must check the existence of new information with respect to player KYC or banned players in the DGOJ's verification service on a daily basis and subsequently respond to the DGOJ after applying the required actions. Additionally, the DGOJ sent a communication dated January 31, 2024, requiring operators to follow a mandatory protocol for players who have suffered identity theft and have received notifications from the Spanish tax authorities for untaxed gambling winnings, to provide the means of contact and the necessary information to defend their position before the authorities.

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Title VII of the Spanish Gaming Law determines the tax regime applicable to gambling activities in compliance with the provisions of the Additional Provision Twenty of Law 56/2007, of December 28, on measures to promote the information society, the applicable tax rate being:

● State-run lotteries and games: 22% on the tax base.

● Parimutuel sports betting, straight sports betting and sports betting exchange; parimutuel horse betting, straight horse betting and horse betting exchange; and other parimutuel betting, straight betting and betting exchange: 20% on the tax base.

● Raffles: 20% on the tax base, unless they are declared to be of public utility or for charity and are therefore taxed at 5% on the tax base.

● Contests and other games: 20% on the tax base.

● Random number combinations for advertising or promotional purposes: 10% on the tax base.

General State Budget Law 6/2018, of July 3, for 2018, introduced a regulatory change in terms of tax benefits by reducing by 50% the tax rates on gambling, included in the Spanish Gaming Law. The objective of this reduction is to transfer tax benefits to the Autonomous Cities of Ceuta and Melilla that are collected in other taxes for them. Since then, both Autonomous Cities have seen a reduction in the tax for online gambling operators, leaving gambling tax at 10%. To qualify for this regime, a company is required to be registered in Ceuta or Melilla and 50% of the employees have to be registered in these territories.

*Mexico*

Codere Online operates online gaming in Mexico pursuant to license 2768 granted to LIFO in May 1990, which was renewed for a period of 12 years under Official Letter DGJS/1018/2015, expiring on May 10, 2027, which allows for the operation of 18 retail locations in Mexico and online gaming. By virtue of Official Letter No. DGJS/234/2019, dated March 14, 2019 the Ministry of Interior authorizes Codere Online to operate online gaming through the website: www.codere.mx (the "LIFO License").

Mexico lacks a federal provision for online gambling, and the subsector is regulated under the Federal Law on Games and Drawings, of December 31, 1947 (the "Gaming Law"). The Gaming Law establishes that the Federal Executive, through the Ministry of the Interior, is responsible for the regulation, authorization, control and oversight of gambling and betting of any kind, including draws, with the exception of the National Lottery, which is governed by its own law.

On October 23, 2013, the Regulations for the Federal Law of Games and Draws were published in the Mexican Official State Gazette, in which the main technical requirements for the gambling and gaming activities on the internet were determined, among others:

● Article 85 - The establishments shall be able to receive wagers via the internet, by telephone or electronically. For that purpose, they shall establish a system of internal control for the transactions that are made through any of these channels, including a written description of the procedures and regulations to ensure inviolability and prevent the manipulation of wager systems. Said system shall have a record of at least: (i) the number of the account and the identity of the player, and (ii) the date, time, number of transaction, wagered amount and requested selection. The mechanism for receiving wagers shall be previously approved by the Secretariat of Government.

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● Article 87 - Permit holders shall fulfill the following procedures for issuing the wager tickets: (i) for each accepted wager, a single and original ticket shall be issued, which shall be given to the player, and it must be printed out with a serial number, bar code and a different number for each ticket machine, apart from the date and time of issue, wagered amount, type of wager and selection; (ii) for the wagers made via the internet, by telephone or electronically, no ticket shall be issued but the information of such wager shall be immediately registered in the central wager system after the wager has been paid. Since these wagers are made via the internet or electronically, the participants shall have access, for consulting or printing, to a voucher of their corresponding number of folio or rights. All wagers by telephone shall be recorded in audio records, with the player's prior consent; (iii) the ticket machines shall operate connected online, in real time, to the central wager system; (iv) when, at the moment of issuing a voucher, there appears an error in the ticket machine, the voucher shall be cancelled in an administrative way; (v) the vouchers shall only be issued in the time and places appointed or authorized in the permit, and the permit holder can issue early vouchers; and (vi) the wager vouchers shall be paid at the moment that they are requested, whether in cash or through other legally accepted means of payment.

Article 20 of the Gaming Law establishes that the Ministry of the Interior may grant permits to operate betting games and prize draws for the following types of business, without making specific reference to online transactions:

● for the opening and operation of betting exchange at racecourses, greyhound tracks and fronton courts, as well as for the installation of remote betting centers and rooms for drawing numbers or symbols, only to business entities that are duly constituted in accordance with the laws of the United Mexican States;

● for the opening and operation of betting exchange at fairs, to Mexican legal persons;

● for the opening and operation of betting exchange at temporarily established horse races or cock fights, to business entities duly constituted in accordance with the laws of the United Mexican States and natural persons; and

● for the organization of prize draws, to natural and legal persons constituted in accordance with the laws of the United Mexican States.

The latest reform of the Special Tax on Production and Services Law (the "Special Tax Law") published by the Mexican Official State Gazette (DOF) 12/09/19 establishes that the operation of betting games and draws, regardless of the name given to them, that require permission in accordance with the provisions of the Gaming Law and its implementing Regulations, are taxed at a rate of 30%.

Article 18 of the Special Tax Law establishes that the taxable base will include the total amount of bets made by the players, minus prizes and refunds obtained by the players (refunds prior to the betting event). A 30% tax rate will be applicable on the taxable base.

According to the Special Tax Law, the resulting amount may be reduced by:

● the total taxes paid according to the Gaming Law; and

● up to 20% of the amount paid to the Mexican gaming authority in order to undertake a betting activity.

Finally, local gaming taxes may apply depending on each municipality and ranging from 6% to 15% tax rate on the gaming revenue of the company, and a 6% withholding on the prizes obtained by the player. In addition, in recent years, many states have established a tax on expenditures to be withheld from all players and ranges from 6% to 16.5% on their recharge (cash in).

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Local gaming taxes may apply depending on each municipality and ranging from 6% to 15% tax rate on the gaming revenue of the company, and a 6% withholding on the prizes obtained by the player. In addition, in recent years, many states have established a tax on expenditures to be withheld from all players and ranges from 6% to 16.5% on their recharge (cash in).

The Mexico Gaming Decree came into effect on November 17, 2023 which, although does not expressly refer to online gaming, may be deemed to apply to both retail and online operations given online permits are dependent on retail licenses in Mexico. The key amendments provided for in the Mexico Gaming Decree are the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) No additional permits will be issued for slots and live games, only sport betting and bingo will be authorized under newly issued permits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Existing permits (that are currently being operated) will not be affected by the amendments (i.e. authorizations under such permits will be respected until their expiration).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Existing permits may be renewed provided new requirements under the Mexico Gaming Decree are complied with.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Maximum term of permits is reduced to 15 years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Third parties will no longer be authorized to operate a permit pursuant to an operating agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Any retail halls that are not currently being operated would need to abide by requirements under the Mexico Gaming Decree and any change in location of a retail hall would require requesting an additional permit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) SEGOB will issue new criteria providing that "participations" (taxes) will be paid based on the type of permit issued, instead of pursuant to the terms of each independent permit.

On December 15, 2023, LIFO, together with other Codere Group permit holders, filed a claim (*amparo*) against the Mexico Gaming Decree arguing that the sole publication of the Mexico Gaming Decree affects the grandfathered rights of the permit holders. LIFO's claim was admitted on December 19, 2023 by the Fourteenth Court on Administrative Matters in Mexico City. On November 21, 2024, the Sixteenth Court on Administrative Matters in Mexico City issued a resolution in LIFO's favour. This resolution was challenged by the Ministry of the Interior, and it is now pending resolution by a Court of Appeal. See also Item 3.D. "*Risk Factors—Risks Related to Codere Online—Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business.*"

*Colombia*

Codere Online operates online gaming in Colombia pursuant to license C1470, which allows for the operation of online gaming, granted by the Colombian gaming regulator, Coljuegos, to Codere Colombia, S.A., a subsidiary of the Codere Group. The Colombia License was transferred to Codere Online Colombia S.A.S., a subsidiary of Codere Online. The license was originally granted for a term of five (5) years until November 15, 2022 and was subsequently renewed until November 14, 2025 pursuant to contract C1901 (the "Colombia License").

Decree Law 4142 of 2011, amended by Decree number 1451 of 2015, founded the Empresa Industrial y Comercial del Estado Administradora del Monopolio Rentístico de los Juegos de Suerte y Azar ("Coljuegos"), whose role is "[…] *the exploitation, administration, operation and issuance of regulations of the games that are part of the state monopoly of gaming that by law are not attributed to another entity* [...]."

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Pursuant to Article 38 of Law 643 of 2001, amended by Article 93 of Law 1753 of 2015, games operated over the internet are understood to be those in which betting and the payment of prizes are carried out by means that do not require the presence of the player, after they have registered on the authorized website or portal, and the mechanics of which are based on the use of a random number generator or the occurrence of real events, the results of which are not controlled by the operator of the game. Additionally, and focusing on the online gambling subsector, pursuant to the law "[…] *Novelty games are considered, among others, to be pre-printed lotto, the instant lottery, the online lotto in any of its modalities, sports bets or bets at events and all games operated over the internet, or by any other form of information technology that does not require the presence of the bettor.*"

Through resolution number 04 of 2016 and subsequently through resolution number 08 of 2020, Coljuegos approved gaming regulations in relation to novelty games operated over the internet. Those legal persons that are awarded a concession may operate online gaming once they execute the corresponding concession contract and following verification of compliance with the requirements under the gambling regulations and any other parameters as determined by Coljuegos. The operation of other novelty games require authorization from Coljuegos and compliance with the selection processes established in the public procurement general statute.

Article 38 of Law 643 of 2001 provides that the operator must pay an operating fee of 17% of its gross gaming revenue to Coljuegos. When the operator operates novelty games that give the player a return in accordance with the gaming regulations of 83% or more, the minimum rate for the operating rights will be 15% of the gross gaming revenue minus the prizes paid. Notwithstanding, those who operate online games will additionally pay 811 legal monthly minimum wages, which will be settled during the first 20 business days of each year operating year.

Article 93 of Law 1753 of 2015, establishes that internet gambling operators, in addition to paying an operating fee of 17% of gross gaming revenue, must pay COP 559,147,194 (legal tender) in tax at the beginning of each operating year. In addition to this tax, Coljuegos will demand payment by the operator of the so-called "Administration Expenses," which will be 1% of the operating fee.

Coljuegos approved a regulation, applicable to all gaming operators effective as of January 1, 2024, to regulate advertising, sponsorships, promotions and any other form of communications related to gaming in Colombia. The key provisions included in such regulation are the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) An advertising and sponsorship spending limit is set on the maximum amount that operators can spend on advertising and sponsorship. This limit can be one of two amounts, determined at the operator's discretion, namely: (i) an amount equivalent to 20% of the gross gaming revenue net of taxes paid to Coljuegos in the preceding year, and (ii) 11,000 current legal minimum monthly salaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Operators who outspend their limit will be fined up to 100 percent of the excess spend.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Operators are also required to submit an advertising investment plan for the following year to ensure it falls within the authorized range. Advertising investment will be audited by Coljuegos on a quarterly basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Professional sports teams in Colombia will not be authorized to enter into advertising contracts or sponsorship agreements with an unlicensed gambling operator.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Restrictions on advertising in digital platforms and social media are also imposed to promote responsible gaming and to ensure the protection of underage persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Operators are required to establish mechanisms to ensure the identification of players who exhibit signs of problematic gaming.

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*Italy*

On December 30, 2022, Codere Online sold Codere Scommese S.r.l. and ceased its operations in Italy after evaluating a number of strategic alternatives with respect to its Italian business. Codere Online operated online gaming in Italy pursuant to Remote Gaming License no. 15411 granted to Codere Scommese S.r.l. on October 7, 2019, which expired on December 31, 2022 (the "Italy License") and which granted Codere Scommese S.r.l. the right to operate certain online gaming activities.

*Panama*

Codere Online operates online gaming in Panama pursuant to the standalone online gaming license under which ALTA is authorized to conduct online gaming operations in Panama for a twenty (20) year term starting on December 1, 2021, subject to compliance with certain requirements pursuant to the Regulation (the "ALTA License"). As described under Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Panama Restructuring Agreements*", Codere Online may request the transfer of the ALTA License from ALTA to Codere Online, but such transfer is subject to the authorization from the Panama Gambling Control Board. While the ALTA License is held by ALTA, Codere Online will operate the ALTA License under the agreement that Codere Online Panama and ALTA entered into on December 1, 2021.

Law Decree No. 2 of February 10, 1998 (the "Law Decree"), is the legal framework which regulates gaming and gambling activities in Panama. The Gaming Control Board, in representation of the Panama State, assumes the operation of gambling activities and betting activities, for the exclusive benefit of the Panama State. This operation may be exercised directly or through third parties.

Hence, gambling and betting activities that take place in Panama must be authorized, regulated and supervised according to the dispositions of the Law Decree, including gaming and gambling activities and betting activities which take place abroad, by electronic means or other means of remote communication.

In 2002, The Gambling Control Board Plenary, in exercise of its legal powers, issued the regulations governing the licenses of electronic gambling activities which was modified by Resolution No. 11 of March 6, 2020 (the "Resolution"). The Resolution regulates the operation of gambling activities through internet and establishes the procedures and requirements to be fulfilled by all individuals and corporations interested in obtaining a license to operate online gaming platforms. This Resolution expressly excludes from the definition of gambling activities racehorses, lottery, and amateur matches in which Panamanian nationals participate.

Under national law, and individual or corporation may be awarded a maximum of five (5) licenses. Licenses may be granted for a maximum term of twenty (20) years. This license award is always at the discretion of the Gaming Control Board. If the Gaming Control Board authorizes a concession agreement, a one-time fee of fifty thousand balboas (50,000 PAB) must be paid to the Panama State for each gaming license that is awarded, upon the ratification by the National General Controller. Furthermore, during the period established in the concession agreement, the licensee must: (i) pay to Gambling Control Board ten percent (10%) of its gross gaming revenue (to be paid monthly), (ii) grant a compliance guarantee and a prize payment guarantee, and (iii) comply with the terms and conditions of the concession agreement, the Resolution, the Law Decree and any applicable Panamanian legislation, such as:

Law No. 27 of March 24, 2015 and the Executive Decree No. 264 of June 17, 2015, that establish a 5.5% gambling tax, which the licensee, as collector agent, should charge to each payment ticket or coupon, tokens and other documents that have a payment obligation due to gambling activities, betting activities and any other gaming and gambling activity authorized by the Panama State;

Law No. 23 of April 27, 2015 on prevention of money laundering and the funding of terrorism and the financing of the proliferation of weapons of mass destruction. Therefore, a licensee operating gambling activities, betting activities and any other gaming activity authorized by the Panama State is also regulated and supervised by the Superintendence of Supervision and Regulation of Non-Financial Subjects; and

- Law No. 81 of March 26, on data privacy.

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Before standalone online licenses, such as the ALTA License, were authorized pursuant to the Resolution, some operators, such as HIPA, were authorized to operate online sports betting pursuant to a license that allowed the licensee to operate land-based betting agencies under Resolution No. 43 of October 24, 2016 which modified the Resolution No. 77 of September 4, 1999, provided that (i) the client previously registered through land-based betting agencies, and (ii) the operator obtained prior authorization from the Gaming Control Board.

A sports betting operator must pay the Gaming Control Board the following monthly fees: (i) 2% on prizes paid, (ii) 0.25% on amounts wagered of international sport betting, and (iii) 0.5% on amounts wagered of international greyhound racings.

*Argentina*

In Argentina, gaming is mainly regulated at the provincial level. Each province has the exclusive power to exploit, organize, manage, operate, control, monitor, and regulate all forms of gaming, and to establish the conditions to operate in the gaming sector. The power to grant licenses and authorizations for gaming activities is vested on each province. However, gaming activities may be subject to both provincial and federal taxes.

Article 50 of the Constitution of the City of Buenos Aires, provides that the City of Buenos Aires has the exclusive right to exploit and commercialize gambling. The City of Buenos Aires cannot delegate its power to exploit online gaming to third parties. It can only grant permits to authorize private companies to distribute and commercialize online gaming. Law N°538 authorizes the Executive Power of the City of Buenos Aires to create and regulate games approved by the City of Buenos Aires Legislature.

In May 2019, the City of Buenos Aires issued resolution RESDI-2018-321-LOTBA (the "Regulation") approving setting forth the regulatory framework applying to online gaming activities within the City of Buenos Aires. The Regulation was later approved by the City of Buenos Aires Legislature. The regulator of the gambling activity in the City of Buenos Aires is the state owned company Lotería de la Ciudad de Buenos Aires S.E. ("LOTBA"). The Regulation provides that LOTBA may grant permits to third parties for the commercialization and distribution of online gambling. Such permits may be granted for a term of up to five (5) years, renewable for another five (5) years. The holder of such permit shall pay 10% of the gross gaming revenue ("GGR") to the City of Buenos Aires through LOTBA.

The process to award permits was launched in February 2020 following the approval of resolution RESDI 15/LOTBA/20 (subsequently amended by RESDI/71/LOTBA/20) that provides the legal requirements that must be fulfilled by the applicants in order to obtain a permit.

In 2020, Iberargen S.A. submitted an application for a permit and complied with all the requirements requested by LOTBA. On March 12, 2021, LOTBA granted the permit to Iberargen S.A. under code DI-2021-238-GCABA-LOTBA (the "Buenos Aires License") for a period of five (5) years and, in December 2021, authorized Iberargen, S.A. to operate in the City of Buenos Aires thereunder. As of May 3, 2023, through the disposition number 'DI-2023-359-GCABA-LOTBA', LOTBA authorized the assignment of the permit to Codere Online Argentina S.A.

In March 2023, Codere Online withdrew its application for a license in the province of Cordoba (Argentina), which was in the pre-award phase, given regulatory and tax uncertainties related to online gaming activities in the city and the province of Cordoba.

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On April 12, 2023, Codere Online (through a Temporary Union Contract (*contrato de unión transitoria*) 92.2%-owned by Codere Online) signed an online gaming license agreement with the local authority (IPJC) in the Province of Mendoza in Argentina pursuant to which Codere Online is authorized to operate its online gaming business in the Province of Mendoza for a term of 10 years. This agreement followed the award of an online gaming license to Codere Online and several other operators pursuant to Resolution 192/2023 of the IPJC on April 3, 2023. Codere Online started operating in the Province of Mendoza in May 2024.

In addition, gambling in the City of Buenos Aires is subject to a tax on the gross revenue (defined as GGR minus the 10% tax payable to LOTBA) of 6.0%. Law 27.591, as amended on 2021, created a new federal tax applying to online gambling. The tax rate is 2.5% and up to 15% of the net customer deposits, depending on whether the operator is a local company having investments in the gaming sector in Argentina or not. Enforcement of Law 27.591 is subject the issuance of implementing regulations by the federal tax authorities.

In 2022, the federal government has published a decree to enact indirect taxes on online gambling deposits. Decree 293/2022, published on June 1, implements the 2020 federal Budget Law 27,591. According to the 2020 budget law and the new implementing decree, the value of net deposits made by Argentines with online gambling platforms is taxable, with the tax rate ranging from 2.5% to 15% depending on the circumstances of the operator in question.

On September 29, 2023, the national regulator on anti-money laundering, the Financial Information Unit **(**"UIF"), issued a series of resolutions applicable to all gaming operators in Argentina pursuant to which they must comply with additional requirements, including, among others, reinforced due diligence measures, client verification and risk classification of clients. These new requirements became effective on March 1, 2024.

On October 20, 2023 LOTBA issued a new set of regulations requiring gaming regulators operating in the City of Buenos Aires to submit an "Adaptation Plan", which, among others, needs to address (i) amendments to the reporting system data model, (ii) adaptations of the internal control system, (iii) review of the operation with the self-exclusion registration system, (iv) accounts suspension and closure, (v) fraud control mechanisms, and (vi) management report and certifications that evidence compliance with these new requirements. Codere Online submitted the Adaptation Plan to LOTBA within the required deadline (on December 15, 2023) but LOTBA has not confirmed its approval yet. On March 14, 2024, a law reforming the National Regulatory System for the Prevention of Money Laundering and Financing of Terrorism (LA/FT) was passed in Argentina, a project that was promoted by the UIF. This new law introduces more tools for the fight against organized crime, promotes the effectiveness of the preventive and repressive system, promotes compliance with AML/CFT obligations by the private sector and the adaptation to new technologies and their related products and services.

*Malta*

Codere Online held business-to-consumer ("B2C") and business-to-business ("B2B") Maltese gaming licenses until the first quarter of 2023. Codere Online voluntarily surrendered its B2C license on February 28, 2023 as it does not currently offer online casino and sports betting to customers located in Malta. On March 3, 2023, Codere Online voluntarily surrendered its B2B license, which authorized the provision of B2B gaming services.

On October 20, 2022, the Codere Online Board approved the liquidation of its Maltese supporting entity OMSE, which was liquidated on December 1, 2023, of its Gibraltar supporting entity Codere (Gibraltar) Marketing Services Limited, which was liquidated on January 17, 2024 and of its Maltese operating entity ONOL, that once completed, will be effective as of August 28, 2024.

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**C.** **Organizational Structure** 

Codere Online is a holding company with the following subsidiaries in the United States, Spain, Israel, Malta, Panama, Colombia, and Mexico as of December 31, 2024.

---

| | | |
|:---|:---|:---|
| **Name of Subsidiary** | **Ownership<br> Interest** | **Jurisdiction of<br> Organization** |
| Asociación en Participación<sup>(1)</sup> | 99.99%<sup>(1)</sup> | Mexico<sup>(1)</sup> |
| Codere Online Mexico S.A de C.V. | 100% | Mexico |
| Codere Israel Marketing Support Services Limited | 100% | Israel |
| Codere Online Argentina S.A. | 95% | Argentina |
| Codere Online Argentina, S.A. Unión Transitoria<sup>(2)</sup> | 92.2% | Argentina |
| Codere Online Colombia S.A.S. | 100% | Colombia |
| Codere Online Operator Limited<sup>(3)</sup> | 100% | Malta |
| Operating Management Services Panama, S.A.<sup>(4)</sup> | 100% | Panama |
| Codere Online U.S. Corp. | 100% | United States |
| Codere Online, S.A.U. | 100% | Spain |
| Servicios de Juego Online S.A.U. | 100% | Spain |

---

<sup>(1)</sup> "Asociación en Participación" or "AenP" (an unincorporated joint venture) with LIFO, a wholly-owned subsidiary of the Codere Group, under which Codere Online, through SEJO, operates online gaming and is entitled to receive 99.99% of any distributed profits whereas LIFO is entitled to receive the remaining 0.01% of any such distributed profits. See Item 7.B. "*Related Party Transactions*—*Material Agreements*—*AenP Agreement*".

<sup>(2)</sup> Codere Online (through a Temporary Union Contract (*contrato de unión transitoria*) 92.2%-owned by Codere Online) signed an online gaming license agreement with the local authority (IPJC) in the Province of Mendoza in Argentina pursuant to which Codere Online is authorized to operate its online gaming business in the Province of Mendoza for a term of 10 years. This agreement followed the award of an online gaming license to Codere Online and several other operators pursuant to Resolution 192/2023 of the IPJC on April 3, 2023. Codere Online started operating in the Province of Mendoza in May 2024.

<sup>(3)</sup> Currently in dissolution, with its liquidation pending approval by the Malta Business Registry. Once approved, the liquidation will be effective as of August 28, 2024.

<sup>(4)</sup> Formerly Codere Online Panama, S.A.

**D.** **Property, Plant and Equipment** 

Codere Online leases from Codere Newco a portion of the space within the offices of the Codere Group headquarters located at Avenida de Bruselas, 26 in Alcobendas (Madrid, Spain). Codere Online also has the right to use certain office space and equipment within Codere Group's offices across various jurisdictions. Codere Online also leases office spaces in Melilla (Spain), Luxembourg and Israel from third-parties.

**ITEM 4A. UNRESOLVED STAFF COMMENTS.**

Not applicable.

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**Item 5. Operating and Financial Review and Prospects**

**A.** **Operating Results** 

*The following discussion and analysis provides information which Codere Online's management believes is relevant to an assessment and understanding of Codere Online's results of operations and financial condition. This discussion and analysis should be read together with the Annual Financial Statements that are included elsewhere in this annual report. This discussion and analysis should also be read together with Item 4.B. "Business Overview." In addition to historical financial information, this discussion and analysis contains forward-looking statements based upon current expectations that involve risks, uncertainties and assumptions. See the section entitled "Cautionary Note Regarding Forward-Looking Statements." Actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under Item 3.D. "Risk Factors*" *or elsewhere in this annual report.*

*This discussion and analysis contains certain financial measures, in particular the presentation of EBITDA, which are not presented in accordance with IFRS. These non-GAAP financial measures are being presented because they provide Codere Online's management and readers of this annual report with additional insight into Codere Online's operational performance relative to historical periods and relative to its competitors. These non-GAAP financial measures are not a substitute for any IFRS financial information. Readers of this annual report should use these non-GAAP financial measures only in conjunction with the comparable IFRS financial measures. Reconciliations of EBITDA to Net Income/(Loss), the most comparable IFRS measure, are provided in this annual report.*

**Overview**

Codere Online is an international online casino gaming and online sports betting group focused on providing its customers with a safe and enjoyable online gaming experience. Codere Online currently operates primarily in Spain, Mexico, Colombia, Panama and Argentina, where it offers its users the ability to play online casino games and bet on sports events. Codere Online seeks to innovate and expand its product offering on its established and flexible technology platform as it pursues its vision to be a leading online casino gaming and online sports betting operator in Latin America. Codere Online maintains a wide and updated catalogue of online casino games from multiple third-party content providers.

As part of the Codere Group, Codere Online leverages the "Codere" brand, a well-recognized brand in the gaming industry across Spain and Latin America, by providing customers with an online gaming experience consistent with the Codere Group's retail footprint. The Codere Group is a leading international gaming operator founded in 1980 with a presence across Spain, Italy and Latin America, including in all of the markets where Codere Online operates. The Codere Group had over 45,000 slots in nearly 7,000 controlled and third-party retail venues throughout Latin America, Spain and Italy as of December 31, 2024, and approximately 45,000 slots and 9,000 retail venues as of December 31, 2023.

In 2014, the Codere Group entered into the online gaming business in Spain to pursue new avenues of growth and diversification of its revenue streams, first through Desarrollo Online de Juegos Regulados, S.A. and CDON, and Codere Apuestas, S.A.U. in Madrid, Spain, and afterwards independently through CDON, which was created to lead the Codere Group's expansion into the online casino gaming and online sports betting markets beyond Spain. To enhance its business, in 2018, the Codere Group recruited an experienced online management team led by industry veteran Moshe Edree with top tier online casino gaming and online sports betting expertise. Mr. Edree was replaced by former Chief Operating Officer Aviv Sher on March 1, 2023. As of March 31, 2025, Codere Online had approximately 325 employees, including directors, intermediate managers, technicians and administrative personnel based in Spain, Mexico, Colombia, Panama, Argentina and Israel. Codere Online operates under the "Codere" brand across all of its markets.

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Codere Online believes it is well-positioned for continued growth with the support of the "Codere" brand, its dedicated and highly-experienced management team and an established and flexible technology platform, and due to other macroeconomic and industry tailwinds. Codere Online believes that this privileged combination of expertise, brand recognition and infrastructure across multiple jurisdictions will not only support its continued success in the markets in which it operates, but also allow Codere Online to capture market share in existing markets and in other expansion markets in the future. In particular, Codere Online may decide to expand into other markets in Latin America (several of which have recently regulated or are expected to be regulated in the near future), including Brazil, Chile, Peru, Puerto Rico and Uruguay, as well as Argentina (beyond the City of Buenos Aires, where it started operating in December 2021), subject to obtaining the required regulatory approvals once such markets become regulated. Additionally, Codere Online intends to explore options to access the large Hispanic market in the United States (an estimated 64 million people as of 2022, according to the U.S. Census Bureau) in the future.

Codere Online's product offering and platform are designed to create exciting online casino gaming and online sports betting experiences for its customers. Codere Online's established and flexible technology platform has an extensive track record of successfully serving its customers and provides the business with a solid foundation for future growth.

Codere Online has established itself as a leading operator across a number of markets since it began operations. According to Codere Online's estimates, Codere Online's market share in the online gaming markets of Mexico, Colombia, Panama and Spain ranged between approximately 2% and 22% in each of such markets in terms of net gaming revenue as of December 31, 2024. Since the Business Combination, which was consummated in November 2021, Codere Online has been using a significant part of the proceeds to fund customer acquisition costs in order to accelerate the acquisition of new customers and market share growth in Spain, Mexico and its other markets. Codere Online is currently in the process of shifting its priority from pursuing growth to seeking to achieve profitability and sustainability of its operations.

In the City of Buenos Aires, Iberargen S.A., a subsidiary of the Codere Group, started operating in December 2021 and was the first operator to receive approval for its platform implementation program in October 2020 by the City of Buenos Aires' regulator, LOTBA (*Lotería de Buenos Aires*). In addition, Codere Online expects to benefit from the Codere Group's leading retail presence in the province of Buenos Aires, where it operates 13 bingo halls and has a significant market share. Further, Codere Online further expanded its operation to the Province of Mendoza, where it was awarded an online gaming license in April 2023 and began operating in 2024.

For the twelve months ended December 31, 2024, Codere Online's revenues grew to €200.7 million compared to €161.6 million for the twelve months ended December 31, 2023, mainly driven by strong revenue growth from casinos for the year compared to 2023 and strong revenue trends in Mexico and Spain. For the twelve months ended December 31, 2023, Codere Online's revenues grew to €161.6 million compared to €115.7 million for the twelve months ended December 31, 2022, mainly driven by strong revenue growth in online casino for the year compared to 2022.

**Key Factors Affecting Operating Results**

The following factors have affected, and are expected to continue to affect, our business, results of operations, financial condition and prospects:

***Industry Opportunity and Competitive Landscape***

Codere Online operates within the global entertainment and gaming industry, which is comprised of diverse products and offerings that compete for consumers' time and disposable income. Our short-to-medium focus is on replicating our Spanish online strategy in certain high growth core markets in Latin America, including Mexico, Colombia, Panama and Argentina. We will also seek to expand into new markets in Latin America as they become regulated, including Brazil, Chile, Peru, Puerto Rico, Uruguay and certain other regions of Argentina (beyond the City of Buenos Aires,

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where we started operating in December 2021 and the Province of Mendoza, where we started operating in April 2024). We also intend to explore options to access the Hispanic market in the United States. As Codere Online prepares to enter new jurisdictions, it expects to face significant competition from other established industry players, some of which may have more experience in online casino gaming and online sports betting and have access to more resources. Codere Online believes that its online gaming platform, experience operating in different jurisdictions, the "Codere" brand and its marketing strategies which appeal to customers and its many unique product offerings and bonus features will enable Codere Online to compete with such established industry players.

Codere Online's performance may vary from one jurisdiction to the next as a result of the level of competition in each jurisdiction among other factors.

***Legalization, Regulation and Taxation***

While Codere Online's financial growth prospects relate mainly to its business in the markets in which it already operates, Codere Online intends to expand its business to additional regions in Latin America (Brazil, Chile, Peru, Puerto Rico, Uruguay and Argentina (beyond the City of Buenos Aires, where it started operating in December 2021 and the Province of Mendoza, where it has started operating in May 2024).

Codere Online's expansion to such regions depends on the legalization of online casino gaming and online sports betting across Latin America, a trend that Codere Online believes is in its early stage. Online casino gaming and online sports betting may expand further due to many factors, including that countries are seeking ways to increase revenues. Codere Online's strategy is to enter new jurisdictions that open up through new regulatory frameworks and licensing regimes, where Codere Online believes it is financially prudent for it to enter.

The process of securing and maintaining the necessary licenses or partnerships to operate in a given jurisdiction may take longer than Codere Online anticipates or not be successful at all. See Item 3.D. "*Risk Factors—Risks Related to Codere Online—Codere Online relies on licenses to conduct its operations, and the failure to obtain or renew or the termination of these licenses could have a material adverse effect on its business.*" In addition, legislative or regulatory restrictions and gaming taxes may make it less attractive or more difficult for Codere Online to do business in a particular jurisdiction. Further, certain jurisdictions require Codere Online to have a relationship with a land-based gaming venue for online gaming and sports wagering access, which tends to increase expenses.

In addition, as an online gaming operator, Codere Online has experienced and may continue to experience increasing regulatory pressure in the form of advertisement restrictions, taxation increases, limitations on payment methods, licensing and sponsorship restrictions, limitations on promotions and maximum bets or prizes, among others. Other laws or regulations with a direct impact on the gaming industry include laws or regulations that prohibit money laundering and financing of terrorist and other unlawful financial activities. Changes to any such laws and regulations could impact Codere Online's profitability and restrict its ability to operate its business. See Item 3.D. "*Risk Factors—Risks Related to Codere Online—The online gaming industry is subject to extensive regulation (including applicable direct and indirect taxation, anti-corruption, anti-money laundering and economic sanctions laws) as well as licensing requirements. Codere Online's business may be adversely affected if it is unable to comply with regulations or licensing requirements or any regulatory changes.*"

Finally, governments impose taxes on online casino gaming and online sports betting, which may vary substantially between jurisdictions and be subject to changes. See Item 3.D. "*Risk Factors—Risks Related to Codere Online—Changes in taxation or the interpretation or application of tax laws could have a material adverse effect on Codere Online's business, results of operations and financial condition.*"

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***Ability to Acquire, Retain and Monetize Users***

Codere Online's ability to effectively market is critical to operational success. Using experience, dynamic learnings and analytics, Codere Online leverages marketing to acquire, convert and retain customers. Codere Online uses a variety of paid marketing channels, in combination with compelling offers and unique product features, to attract and engage customers. Furthermore, Codere Online optimizes its marketing spend using and exhaustively analyzing data collected since the beginning of its operations. Codere Online's marketing spend is based on a model that considers a variety of factors, including the products offered in each jurisdiction, the performance of the different marketing channels, predicted lifetime value, marginal costs and expenses and behavior of users across various product offerings. Where paid marketing is concerned, Codere Online leverages a broad array of advertising channels, including television, radio, social media platforms, sponsorships, affiliates and paid and organic search, and other digital channels. These efforts are concentrated within the specific jurisdictions where Codere Online operates or intends to operate. Codere Online believes that there is significant benefit to having a flexible approach to advertising spending as it can move its advertising spending around based on dynamic outreach. These investments and personalized promotions are intended to increase consumer awareness and drive engagement.

Codere has begun shifting its priority from pursuing growth to seeking to achieve profitability and sustainability of its operations. While Codere Online is continuing to assess the efficiency of its marketing and promotion activities, it is difficult for Codere Online to predict when it will achieve its longer-term profitability objectives.

***Managing Wagering Risk***

The online casino gaming and online sports betting businesses are characterized by an element of chance and the outcome of external results. Accordingly, Codere Online employs theoretical and projected take rates, based on historical data, to estimate how a certain type of online casino or sports wager, on average, will perform in the long run. Although each online casino or sports wager generally performs within a defined statistical range of outcomes in the long run, actual outcomes may vary for any given period, particularly in the short term. In the short term, for online casino and sports wagering, the element of chance and the outcome of external results may affect take rates; these take rates, particularly for online sports wagering, may also be affected in the short term by factors that are largely beyond Codere Online's control, such as unanticipated event outcomes, a user's skill, experience and behavior, the mix of games played or wagers placed, the financial resources of users, the volume of wagers placed and the amount of time spent gambling. For online casino games, it is very rare, but possible, that a random number generator outcome or game will malfunction and award errant prizes. For online sports wagering, it is possible that Codere Online's platform erroneously posts odds or is otherwise misprogrammed to pay out odds that are highly favorable to bettors, and bettors place wagers before the odds are corrected. Additionally, odds compilers and risk managers are capable of human error, so even if Codere Online's wagering products are subject to a capped payout, significant volatility can occur. As a result of the variability in these factors, the actual take rates on Codere Online's online casino games and sports wagers may differ from the theoretical or projected take rates it has estimated and could result in the winnings of Codere Online's online casino games or sports bet's users exceeding those anticipated. The variability of take rates also has the potential to adversely affect Codere Online's business, results of operations, financial condition, prospects and cash flows.

Codere Online seeks to mitigate these risks through data science and analytics and rules built into its platform, as well as active management of its amounts at risk at a point in time, but it may not always be able to do so successfully. In particular, as part of its platform, Codere Group's Trading and Risk team is responsible for implementing the pricing strategy (*i.e.*, setting and continuously adjusting, based on averaging activity, the fixed odds) defined by Codere Online and its furtherance of Codere Online's online sports betting offering, as well as identifying fraudulent activity. Codere Group's Trading and Risk team receives, reviews and compares the odds received by third-party feed providers to Codere Online's strategy and informs management on the risk assumed as a result of the accumulated amount of bets in the event that they exceed the amounts established as per risk management parameters in place at the time. Further, Codere Group's traders continuously monitor competitor pricing across a wide range of sporting events to ensure that Codere Online's betting markets are competitive. For additional information, see Item 4.B. "*Business Overview*—*Technology Platform*."

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***Seasonality and Mix of Revenue Based on Time Period in Markets***

Codere Online's profitability will generally depend on how long it has been operating in each jurisdiction. Generally, but not always, Codere Online's level of profitability will increase with more years in a jurisdiction. Further, Codere Online's online sports betting business experiences seasonality based on the relative popularity of certain sports. Although exciting sporting events occur throughout the year, Codere Online's online sports wagering users are most active during the season of the main sport league in a given jurisdiction as well as during any worldwide events, such as the FIFA World Cup in the last quarter of 2022.

***Limited Operating History and Potential for Growth***

Codere Online has a limited operating history in the online casino gaming and online sports betting industry, which is continuously evolving. As an early-stage company, Codere Online has not yet demonstrated its ability to obtain profit in all of its operating segments.

Although Codere Online has begun shifting its priority from primarily pursuing growth to also focusing on profitability and sustainability of its operations, Codere Online intends to continue making significant investments to support its business operations and growth as it continues to invest. There is no assurance that Codere Online's strategy will be successful or that the Company will meet its future goals and priorities. Consequently, any predictions about future performance may not be as accurate as they would be if Codere Online had a history of successfully operating in the online gaming industry or if Codere Online was going to continue to operate in accordance with past practice.

***Independent Operations and Listing***

Codere Online has limited experience operating as an independent company or as a Nasdaq-listed company. Historically, Codere Newco and certain of its subsidiaries have provided certain services related to corporate functions including, among other services, general management, management control, internal audit, communication, legal, financial management, human capital, corporate security support, platform services and corporate development. Following the consummation of the Business Combination, Codere Newco has continued to provide some of these services under a Sponsorship and Services Agreement between Codere Online and Codere Newco. While these services are being provided to Codere Online by Codere Newco and certain of its subsidiaries, Codere Online will be dependent on them for services that are critical to Codere Online's operation, and Codere Online's operational and financial flexibility to modify or implement changes with respect to such services may be limited. Codere Online's results of operations may be affected by its dependency on these services. The Codere Group's ability to provide services to Codere Online or its performance of the related-party agreements (including the Sponsorship and Services Agreement, the Relationship and License Agreement, the New Platform and Technology Services Agreement, the AenP Agreement or the Restructuring Agreements, on which Codere Online currently depends to conduct its business) may be affected as a result of changes in Codere Group's management, business priorities and strategy, or if the Codere Group enters into (or fails to enter into) further corporate reorganizations or restructurings or if the Codere Group fails to meet its liquidity needs, its operations are interrupted or intervened or otherwise. Codere Online's management has prepared the Annual Financial Statements assuming that Codere Online will continue as a going concern. See Item 3.D "*Risk Factors—The Annual Financial Statements have been prepared assuming that Codere Online will continue as a going concern*"

Furthermore, as a public company, Codere Online acts in an increasingly demanding regulatory environment, which requires it to comply with the Sarbanes-Oxley Act, the regulations of Nasdaq, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and more complex accounting rules. Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures. Codere Online anticipates that the process of building its accounting and financial functions and infrastructure will require significant additional professional fees, internal costs and management efforts.

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***Exchange Rate Fluctuations***

Codere Online's functional currency is the euro. Codere Online's business, results of operations and financial condition can be affected significantly by fluctuations in the exchange rates of Codere Online's main non-euro operating currencies, mainly the U.S. dollar, the Mexican peso, the Colombian peso and the Argentine peso. In particular, fluctuations in exchange rates may result in foreign exchange gains or losses for Codere Online. See Note 16 to the Annual Financial Statements beginning on page F-49 and Item 5.E. "*Critical Accounting Policies and Estimates—Exchange rate risk"* for information on the impact of a 10% depreciation or appreciation of the euro against the main foreign currencies on Codere Online's audited consolidated balance sheets as of December 31, 2024 and 2023 and consolidated statements of operations for the years ended December 31, 2024 and 2023, and carve-out income statement for the year ended December 31, 2022.

**Key Components of Statements of Operations**

***Segment Reporting***

Under IFRS 8 (*Segment Information*), operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM") which, in the case of Codere Online, is the Chief Executive Officer of Codere Online. The CODM is responsible for allocating resources and assessing performance of the business. The CODM measures the performance of Codere Online's business by its revenue and EBITDA, which is a non-GAAP measure calculated as net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization. See "*—Non-GAAP Financial Data*" for a reconciliation of EBITDA to net income/(loss).

Codere Online's business includes the following operating segments:

● *Spain*. The Spain segment consists of revenue generated by CDON.

● *Mexico*. The Mexico segment consists of revenue generated by the AenP pursuant to the AenP Agreement.

● *Colombia.* The Colombia segment consists of revenue generated by Codere Online Colombia S.A.S.

● *Other Operations*. The Other Operations segment consists of revenue generated by Operating Management Services Panama S.A., Codere Online Argentina, S.A. and Codere Online Argentina S.A. Union Transitoria (collectively, "Other Operations").

● *Supporting Entities.* The Supporting Entities segment consists of revenue generated by Codere Israel Marketing Support Services LTD, Codere Online Luxembourg S.A., Codere Online U.S. Corp., Codere (Gibraltar) Marketing Services LTD, Servicios de Juego Online S.A.U. and Surviving Corporation (collectively, the "Supporting Entities"). The Supporting Entities provide support services, such as marketing and management services, to the operating entities of Codere Online. Therefore, most of the revenue generated by the Supporting Entities is eliminated in the consolidation process, as a result of offsetting the corresponding expenses from the relevant operating entities.

The entities that have been aggregated under the Other Operations and Supporting Entities segments have been grouped in accordance with guidance under IFRS 8 (*Operating Segments*). Additionally, each of the Other Operations and Supporting Entities segments meet the following conditions: (i) aggregation is consistent with the core principle of IFRS 8, (ii) the components of each segment have similar economic characteristics, (iii) the products and services offered by the components of each segment are similar in nature, (iv) the nature of the production processes of the components of each segment are similar in nature, (v) the type or class of customer for the products and services of the components of each segment is similar, (vi) the components of each segment have similar methods to distribute their products and provide their services and (vii) the regulatory environment of the components of each segment is similar.

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***Revenue***

Codere Online earns revenue primarily through online casino and online sports betting.

*Online casino games*

Online casino offerings include the full portfolio of games typically available in land-based casinos, gaming halls and gambling establishments, such as slot machines, table games and bingo. For these offerings, Codere Online functions similarly to land-based casinos, generating revenue, as users play against the house. There is certain volatility with online casino wagering, as with land-based wagering, but as the volume of wagers placed increases, the revenue retained from wagers placed becomes easier to predict. Codere Online's experience has been that online casino margins are less volatile than online sports margins.

Codere Online's online gaming offerings consist of a combination of licensed content from leading suppliers in the industry. Third-party content is subject to standard revenue-sharing agreements specific to each supplier, whereby the supplier receives a percentage of the gaming revenue generated from the games played on Codere Online's platform. In exchange, Codere Online receives a limited license to offer the games on its platform to users in jurisdictions where use is approved by the regulatory authorities.

Codere Online maintains a wide and updated catalogue of online casino games from multiple third-party content providers. Codere Online believes that its ability to offer a wide array of online gaming products effectively reduces its customer acquisition costs and player churn by providing a superior product offering to customers.

*Online sports betting and other bets*

Online sports betting involves a user placing a wager on an event at some fixed odds (a "proposition") determined by Codere Online. If the user wins, Codere Online pays out the bet. If the user loses, Codere Online keeps the amount wagered. Codere Online takes risk on any such wager to the extent that its "book" (i.e., wagers accepted for either or all propositions bet outcomes) may not be balanced and, depending on the result of the event, Codere Online may generate an aggregate win or loss on the overall book. Codere Online seeks to generate revenue by setting odds such that there is a built-in theoretical margin in each proposition offered to its users. While different outcomes of the events may cause volatility in Codere Online's revenue, Codere Online believes it can deliver a fairly stable sports betting margin over the long term.

As part of the platform, Codere Group's Trading and Risk team is responsible for implementing the pricing strategy (*i.e.*, setting and continuously adjusting, based on averaging activity, the fixed odds) defined by Codere Online and its furtherance of Codere Online's online sports betting offering. For a more detailed description, see Item 4.B. "*Business Overview—Technology Platform*." In addition to traditional pre-match wagering, where Codere Online has a robust offering with historical data, odds statistics and latest teams and players news, Codere Online offers other sports wagering products such as live betting. Codere Online has also incorporated live streaming of sporting events into its online sports betting offering, on a round-the-clock basis and with industry-leading match visualization features.

Codere Online's online sports betting business has a vast and diversified offering with thousands of live events per year throughout most major sports taking place around the world, which helps to minimize the impact of seasonality. Nonetheless, seasonality has an effect in certain periods of the year given the relative popularity of certain local sports, such as top tier football in Europe.

***Personnel expenses***

Personnel expenses consist primarily of wages, salaries and similar expenses, as well as, to a lesser extent, social security and other social contributions payable by Codere Online.

For additional information on Codere Online's employees, see Item 6.D. "*Employees*."

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***Depreciation and amortization***

Due to the online nature of the business, investments in property, plant and equipment are not significant.

Depreciation and amortization consist primarily of the amortization of intangible assets and, to a much lesser extent, depreciation of property, plant and equipment and amortization of right-of-use assets. For additional information on Codere Online's amortization of intangible assets, see Note 5 to the Annual Financial Statements beginning on page F-30.

***Other operating expenses***

Other operating expenses consist primarily of marketing expenses, professional services and other expenses, gambling taxes, casino license royalties (which consists of fees paid to third parties for the commercialization of their casino games), which are described in more detail below, as well as utilities, repairs and maintenance, among other expenses.

Professional services and other expenses mainly include: (i) streaming services contracted with external parties offered to our customers as a complement to our sports complete betting offer, (ii) the payment processing which allows our customers to deposit and withdraw money using user-friendly platforms from payment processing providers and (iii) some of our less popular sports odds hired to external providers. Additionally, included within this heading are expenses related to our customer relationship management tools.

As part of its growth strategy, Codere Online significantly increased its marketing expenses following the consummation of the Business Combination in 2022. Although Codere Online started to shift its priority from pursuing growth to seeking to achieve profitability and sustainability of its operations in 2023, Codere Online has continued to invest significant proceeds to fund its marketing expenditure in its core markets through 2024.

Marketing efforts vary significantly from region to region:

● *Spain*. The market in Spain is mature. Therefore, while Codere Online continuously seeks to acquire new customers from its competitors, it mainly focuses its marketing efforts on its existing customers to drive an increase in spending. The most notable marketing initiative in Spain in recent years has been the sponsorship agreement with Real Madrid. Nonetheless, on November 24, 2020, the RM Sponsorship Agreement was amended and terminated in respect of Spain only (without prejudice to the agreement remaining in force in the remaining applicable jurisdictions) at the end of the 2020/2021 football season due to newly-enacted advertising legal restrictions (which affect sponsorship) in Spain. On October 7, 2021, the RM Sponsorship Agreement was further amended to, among other things, extend the term of the RM Sponsorship Agreement for four (4) additional football seasons, until June 30, 2026 (with either party having a right to terminate the agreement at the end of the 2022-2023 football season) and amend the applicable territory to only include Mexico, South America, Central America, Puerto Rico and Dominican Republic. Codere Online benefits from and has use rights to the existing, and any future amended, sponsorship agreement with Real Madrid. See the section entitled Item 7.B. "*Related Party Transactions* — *Material Agreements* — *Sponsorship and Services Agreement.* "

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● *Mexico*. The market in Mexico is expanding. Therefore, Codere Online focuses on gaining new customers through its marketing initiatives and loyalty programs. The most notable marketing sponsorship agreement in Mexico is the agreement with the football team Rayados in Monterrey, a leading team in the local league, a deal which Codere Online closed in early 2021 and further extended in 2024 in order to replicate its Spanish marketing model.

● *Colombia*. The market in Colombia is expanding. Therefore, Codere Online focuses on gaining new customers through its marketing initiatives and loyalty programs. In Colombia, Codere Online has various sponsorships with sports celebrities.

● *Argentina.* Codere Online started operating in the City of Buenos Aires in December 2021 and has expanded its operation to the Province of Mendoza in 2024, where it was awarded an online gaming license in April 2023. In order to boost its brand positioning, the Codere Group entered into a sponsorship agreement between 2021 and April 2025 with one of the two most important football teams in Argentina, River Plate. Codere Online benefitted from Codere Group's sponsorship agreement with River Plate pursuant to the terms and conditions of the Sponsorship and Services Agreement. On December 12, 2024, the parties agreed to terminate the River Plate sponsorship agreement with effect as of April 30, 2025 (see Item 7.B. "*Related Party Transactions* — *Material Agreements* — *Sponsorship and Services Agreement* ").

***Finance income / (costs)***

Finance income / (costs) consists primarily of both realized and unrealized foreign exchange gains/(losses) that have been created due to the fluctuation of the exchange rates between the euro and the other currencies, mainly the US Dollar, the Mexican peso, the Colombian peso, the Argentine peso and the Panamanian balboa, that Codere Online uses in its operations as well as interest expense related to Codere Online's outstanding loans and borrowings from related parties. (see Item 5.B. "*Liquidity and Capital Resources—Indebtedness*").

Additionally, finance income related to the change in fair value of Codere Online Warrants is included under this heading. The Codere Online Warrants resulted from the conversion of the DD3 Warrants into warrants of Codere Online representing the right to purchase Ordinary Shares. On November 30, 2021, the date of the conversion, the market price of the Codere Online Warrants was approximately €1.46 per Codere Online Warrant or €9.4 million in the aggregate. As of December 31, 2024, and 2023, the fair value of the warrant liabilities amounted to approximately €3.7 million and €0.4 million, respectively. The change in fair value of the Codere Online Warrants for the years ended December 31, 2024 and 2023 was recorded in the consolidated statements of operations as finance cost amounting to approximately €3.3 million and as a finance income of €0.9 million, respectively.

***Income tax expense***

Income tax expense represents the sum of the tax currently payable and deferred tax, if any. The tax currently payable is based on taxable income for the year. Taxable income differs from income before tax as reported in the consolidated statement of operations and combined carve-out income statement because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. Codere Online's current tax is calculated using rates applicable for the tax period that have been enacted or substantively enacted by the end of the reporting period.

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**Results of Operations**

***Comparison of the year ended December 31, 2024 to the year ended December 31, 2023***

The following table sets forth Codere Online's consolidated statements of operations for the periods indicated, respectively:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br> year ended<br> December 31,** | **For the<br> year ended<br> December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| **Revenue** | **200704** | **161647** | **39057** | **24.2%** |
| Personnel expenses | (18784) | (17437) | (1347) | (7.7)% |
| Depreciation and amortization | (388) | (114) | (274) | n.m. |
| Other operating expenses | (177201) | (158850) | (18351) | (11.6)% |
| **Operating expenses** | **(196373)** | **(176401)** | **(19972)** | **(11.3)%** |
| **OPERATING INCOME / (LOSS)** | **4331** | **(14754)** | **19085** | **129.4%** |
| Finance income / (costs) | 1041 | 5826 | (4785) | (82.1)% |
| **Net finance income / (costs)** | **1041** | **5826** | **(4785)** | **(82.1)%** |
| **NET INCOME / (LOSS) BEFORE TAX** | **5372** | **(8928)** | **14300** | **160.2%** |
| Income tax benefit / (expense) | (1462) | 6513 | (7975) | (122.4)% |
| **NET INCOME / (LOSS) FOR THE YEAR** | **3910** | **(2415)** | **6325** | **n.m.** |
| **Attributable to equity holders of the parent** | **3908** | (2417) | **6325** | **n.m.** |
| **Attributable to non-controlling interest** | **2** | 2 | **-** | **n.m.** |

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The following tables break down certain of the information presented in the consolidated statements of operations for the years ended December 31, 2024 and 2023, respectively by operating segments.

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** | **For the year ended December 31, 2024** |
| <br>**(in thousands of euros)** | **Spain** | **Mexico** | **Colombia** | **Other Operations** | **Supporting** | **Intercompany eliminations<sup>(1)</sup>** | **Total** |
| **Revenue** | **87778** | **95699** | **10629** | **6587** | **52204** | **(52193)** | **200704** |
| Personnel expenses | (2360) | (1746) | (331) | (1041) | (13306) |  | (18784) |
| Depreciation and amortization | (123) | (30) | (2) | (7) | (226) |  | (388) |
| Other operating expenses | (67786) | (96322) | (8986) | (11394) | (44906) | 52193 | (177201) |
| **Operating expenses** | **(70269)** | **(98098)** | **(9319)** | **(12442)** | **(58438)** | **52193** | **(196373)** |
| **OPERATING INCOME/(LOSS)** | **17509** | **(2399)** | **1310** | **(5855)** | **(6234)** | **-** | **4331** |
| Finance income / (costs) | 2036 | (2930) | (310) | 5848 | (3603) | - | 1041 |
| **Net finance income / (costs)** | **2036** | **(2930)** | **(310)** | **5848** | **(3603)** | **-** | **1041** |
| **NET INCOME/(LOSS) BEFORE TAX** | **19545** | **(5329)** | **1000** | **(7)** | **(9837)** | **-** | **5372** |
| Income tax benefit/(expense) | (4154) | 7 | 1 | 26 | 2658 | - | (1462) |
| **NET INCOME/(LOSS) FOR THE YEAR** | **15391** | **(5322)** | **1001** | **19** | **(7179)** | **-** | **3910** |
| Attributable to equity holders of the parent | 15391 | (5324) | 1001 | 19 | (7179) |  | 3908 |
| Attributable to non-controlling interest |  | 2 |  |  |  |  | 2 |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** |
| <br>**(in thousands of euros)** | **Spain** | **Mexico** | **Colombia** | **Other Operations** | **Supporting** | **Intercompany eliminations<sup>(1)</sup>** | **Total** |
| **Revenue** | **75669** | **73315** | **8581** | **4082** | **45263** | **(45263)** | **161647** |
| Personnel expenses | (1968) | (1776) | (292) | (700) | (12701) |  | (17437) |
| Depreciation and amortization | (24) | (32) | (2) | (6) | (50) |  | (114) |
| Other operating expenses | (60362) | (83181) | (10587) | (8897) | (41086) | 45263 | (158850) |
| **Operating expenses** | **(62354)** | **(84989)** | **(10881)** | **(9603)** | **(53837)** | **45263** | **(176401)** |
| **OPERATING INCOME/(LOSS)** | **13315** | **(11674)** | **(2300)** | **(5521)** | **(8574)** | **-** | **(14754)** |
| Finance income / (costs) | 979 | 1632 | 392 | 18 | (246870) | 249675 | 5826 |
| **Net finance income / (costs)** | **979** | **1632** | **392** | **18** | **(246870)** | **249675** | **5826** |
| **NET INCOME/(LOSS) BEFORE TAX** | **14294** | **(10042)** | **(1908)** | **(5503)** | **(255444)** | **249675** | **(8928)** |
| Income tax benefit/(expense) | (1500) | (8) | 187 | 15 | 7819 | - | 6513 |
| **NET INCOME/(LOSS) FOR THE YEAR** | **12794** | **(10050)** | **(1721)** | **(5488)** | **(247625)** | **249675** | **(2415)** |
| Attributable to equity holders of the parent | 12794 | (10052) | (1721) | (5488) | (247625) | 249675 | (2417) |
| Attributable to non-controlling interest |  | 2 |  |  |  |  | 2 |

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(1) Inter-segment transactions are carried out on an arm's length basis and are included in the "Intercompany eliminations" column.

***Revenue***

Revenue increased €39.1 million, or 24.2%, to €200.7 million for the year ended December 31, 2024 from €161.6 million for the year ended December 31, 2023, primarily due to the increase in revenue in Mexico and Spain as set forth below.

For the year ended December 31, 2024 and 2023, online sports betting revenue amounted to €83.4 million and €72.2 million, respectively, and online casino wagering revenue amounted to €117.2 million and €89.5 million, respectively.

The following table sets forth the distribution of our revenues by operating segment for the years ended December 31, 2024 and 2023.

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Spain | 87778 | 75669 | 12109 | 16.0% |
| Mexico | 95699 | 73315 | 22384 | 30.5% |
| Colombia | 10629 | 8581 | 2048 | 23.9% |
| Other Operations | 6587 | 4082 | 2505 | 61.4% |
| Supporting Entities | 52204 | 45263 | 6941 | 15.3% |
| Intercompany eliminations | (52193) | (45263) | (6930) | (15.3)% |
| **Total** | **200704** | **161647** | **39057** | **24.2%** |

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Revenue in Spain increased €12.1 million, or 16.0%, to €87.8 million for the year ended December 31, 2024 from €75.7 million for the year ended December 31, 2023. This increase was primarily due to an increase in online casino wagering, mainly due to the acquisition of casino first players, crossing sports betting customers over to casino to maximize overall player yield.

Revenue in Mexico increased €22.4 million, or 30.5%, to €95.7 million for the year ended December 31, 2024 from €73.3 million for the year ended December 31, 2023. This increase was primarily driven by a 17% increase in the number of active players. During 2024, revenue from online casino wagering increased by €17.0 million, while revenue from online sports betting increased by €5.4 million.

Revenue in Colombia increased €2.0 million, or 23.9%, to €10.6 million for the year ended December 31, 2024 from €8.6 million for the year ended December 31, 2023. During 2024, revenue from online casino wagering increased by €1.5 million, while revenue from online sports betting increased by €0.5 million. Codere Online increased its focus on targeted promotional initiatives and marketing campaigns, including sponsorships with certain celebrities in Colombia.

Revenue from Other Operations increased €2.5 million, or 61.4%, to €6.6 million for the year ended December 31, 2024 from €4.1 million for the year ended December 31, 2023. This increase was primarily driven by Codere Online's operations in the City of Buenos Aires (Argentina) and Panamá.

***Personnel expenses***

Personnel expenses increased €1.3 million, or 7.7%, to €18.8 million for the year ended December 31, 2024 from €17.4 million for the year ended December 31, 2023. This increase was primarily due to the increase in the number of personnel.

***Depreciation and amortization***

Depreciation and amortization increased €0.3 million to €0.4 million for the year ended December 31, 2024 from €0.1 million for the year ended December 31, 2023. The increase was primarily due to the amortization of the right-of-use assets derived from applying IFRS 16 for the first time for the year ended December 31, 2024.

***Other operating expenses***

Other operating expenses increased €18.4 million, or 11.6%, to €177.2 million for the year ended December 31, 2024 from €158.9 million for the year ended December 31, 2023. The increase was primarily due to an increase in marketing, gambling taxes and professional services and other expenses.

The following table sets forth the breakdown of our other operating expenses for the year ended December 31, 2024 and 2023.

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Gambling taxes | 19863 | 16281 | 3582 | 22.0% |
| Leases | 234 | 528 | (294) | (55.7)% |
| Utilities, repairs and maintenance | 1060 | 1432 | (372) | (26.0)% |
| Professional services and other expenses | 62957 | 59203 | 3754 | 6.3% |
| Casino license royalties | 7732 | 6279 | 1453 | 23.1% |
| Marketing expenses | 85355 | 75127 | 10228 | 13.6% |
| **Total** | **177201** | **158850** | **18351** | **11.6%** |

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Professional services and other expenses increased €3.8 million, or 6.3%, to €63.0 million for the year ended December 31, 2024 from €59.2 million for the year ended December 31, 2023. This increase was primarily a result of additional professional services required in connection with the expansion of the business, especially legal, audit and consulting expenses.

Codere Online believes that marketing is a major driver of growth for its business. Codere Online focuses on traditional marketing (including TV, radio and press), digital marketing (including paid media, social media and affiliation networks) and sports sponsorships. Marketing expenses increased €10.2 million, or 13.6%, to €85.4 million for the year ended December 31, 2024 from €75.1 million for the year ended December 31, 2023.

Codere Online has begun shifting its priority from primarily pursuing revenue growth to also focusing on profitability and sustainability of its operations and is in the process of improving the efficiency of its marketing and promotion activities.

The following table sets forth the distribution of our other operating expenses by operating segment for the years ended December 31, 2024 and 2023.

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Spain | 67786 | 60362 | 7424 | 12.3% |
| Mexico | 96322 | 83181 | 13141 | 15.8% |
| Colombia | 8986 | 10587 | (1601) | (15.1)% |
| Other operations | 11394 | 8897 | 2497 | 28.1% |
| Supporting | 44906 | 41086 | 3820 | 9.3% |
| Intercompany eliminations | (52193) | (45263) | (6930) | (15.3)% |
| **Total** | **177201** | **158850** | **18351** | **11.6%** |

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Other operating expenses in Spain increased €7.4 million, or 12.3%, to €67.8 million for the year ended December 31, 2024 from €60.4 million for the year ended December 31, 2023. This increase was primarily due to the increase in marketing expenses from €23.0 million in 2023 to €27.2 million in 2024.

Other operating expenses in Mexico increased €13.1 million, or 15.8%, to €96.3 million for the year ended December 31, 2024 from €83.2 million for the year ended December 31, 2023.This increase was primarily due to the increase in marketing expenses from €49.5 million in 2023 to €54.1 million in 2024. Codere Online concentrated its marketing efforts in Mexico in 2024, where it deployed a significant amount of its marketing spend for a total of 53.4%.

Other operating expenses in Colombia decreased €1.6 million, or 15.1%, to €9.0 million for the year ended December 31, 2024 from €10.6 million for the year ended December 31, 2023. This decrease was primarily due to a reduction in professional services spending of €1.4 million in 2024, from €4.2 million for the year ended December 31, 2023, to €2.8 million for the year ended December 31, 2024.

Other operating expenses incurred by the Other Operations segment increased €2.5 million, or 28.1%, to €11.4 million for the year ended December 31, 2024 from €8.9 million for the year ended December 31, 2023. This increase was primarily due to the increase in marketing expenses from €5.6 million in 2023 to €7.5 million in 2024.

Other operating expenses incurred by the Supporting Entities segment increased €3.8 million, or 9.3%, to €44.9 million for the year ended December 31, 2024 from €41.1 million for the year ended December 31, 2023.

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***Operating income / (loss)***

As a result of the foregoing, operating income increased €19.1 million, or 129.4%, to €4.3 million for the year ended December 31, 2024 from an operating loss of €14.8 million for the year ended December 31, 2023.

***Finance income / (costs)***

Finance income decreased €4.8 million, or 82.1%, to €1.0 million for the year ended December 31, 2024 from finance income of €5.8 million for the year ended December 31, 2023. The decrease was primarily due to negative foreign exchange differences resulting from the fluctuation of the exchange rates between the euro and the other currencies, mainly the Mexican peso, Colombian peso, Argentine peso, and Panamanian balboa. The negative exchange rate impact amounted to approximately €6.5 million for the year ended December 31, 2024. Additionally, finance income was recorded for the year ended December 31, 2024 due to hyperinflation adjustment in Argentina which amounted €9.0 million and due to the change in the fair value of Codere Online Warrants which amounted €3.3 million. On December 31, 2023, the market price of the Codere Online Warrants was approximately €0.07 per Codere Online Warrant or €0.4 million in the aggregate. As of December 31, 2024, the market price increased to approximately €0.58 per Codere Online Warrant or €3.7 million in the aggregate. Therefore, as of December 31, 2024, the fair value of the warrant liabilities amounted to approximately €3.7 million. The change in fair value of the Codere Online Warrants between December 31, 2023 and December 31, 2024 was recorded in the consolidated statement of operations as finance cost amounting to approximately €3.3 million for the year ended December 31, 2024.

***Net income / (loss) before tax***

As a result of the foregoing, net income before tax increased €14.3 million, or 160.2%, to €5.4 million income for the year ended December 31, 2024 from €8.9 million loss for the year ended December 31, 2023.

***Income tax benefit / (expense)***

Income tax benefit decreased €8.0 million, or 122.4% to €1.5 million income tax expense for the year ended December 31, 2024 from €6.5 million income tax benefit for the year ended December 31, 2023. This was primarily due to the fact that Codere Online generated positive pre-tax income in 2024.

***Net income / (loss) for the period***

As a result of the foregoing, net loss for the period decreased €6.3 million to €3.9 million net income for the year ended December 31, 2024 from €2.4 million net loss for the year ended December 31, 2023.

***Comparison of the year ended December 31, 2023 to the year ended December 31, 2022***

The following table sets forth Codere Online's consolidated statement of operations and carve-out income statement for the periods indicated, respectively:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| **Revenue** | **161647** | **115747** | **45900** | **39.7%** |
| Personnel expenses | (17437) | (15301) | (2136) | (14.0)% |
| Depreciation and amortization | (114) | (556) | 442 | 79.5% |
| Other operating expenses | (158850) | (155765) | (3085) | (2.0)% |
| **Operating expenses** | **(176401)** | **(171622)** | **(4779)** | **(2.8)%** |
| **OPERATING LOSS** | **(14754)** | **(55875)** | **41121** | **73.6%** |
| Finance income / (costs) | 5826 | 12460 | (6634) | (53.2)% |
| **Net finance income / (costs)** | **5826** | **12460** | **(6634)** | **(53.2)%** |
| **NET LOSS BEFORE TAX** | **(8928)** | **(43415)** | **34487** | **79.4%** |
| Income tax benefit/(expense) | 6513 | (2968) | 9481 | n.m. |
| **NET LOSS FOR THE YEAR** | **(2415)** | **(46383)** | **43968** | **94.8%** |
| Attributable to equity holders of the parent | (2417) | (46382) | 43965 | 94.8% |
| Attributable to non-controlling interest | 2 | (1) | 3 | n.m. |

---

[**Table of Contents**](#toc)

The following tables break down certain of the information presented in the consolidated statement of operations for the year ended December 31, 2023 and carve-out income statement for the year ended December 31, 2022, respectively by operating segments.

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** | **For the year ended December 31, 2023** |
| <br>**(in thousands of euros)** | **Spain** | **Mexico** | **Colombia** | **Other Operations** | **Supporting** | **Intercompany eliminations<sup>(1)</sup>** | **Total** |
| **Revenue** | **75669** | **73315** | **8581** | **4082** | **45263** | **(45263)** | **161647** |
| Personnel expenses | (1968) | (1776) | (292) | (700) | (12701) |  | (17437) |
| Depreciation and amortization | (24) | (32) | (2) | (6) | (50) |  | (114) |
| Other operating expenses | (60362) | (83181) | (10587) | (8897) | (41086) | 45263 | (158850) |
| **Operating expenses** | **(62354)** | **(84989)** | **(10881)** | **(9603)** | **(53837)** | **45263** | **(176401)** |
| **OPERATING INCOME/(LOSS)** | **13315** | **(11674)** | **(2300)** | **(5521)** | **(8574)** | **-** | **(14754)** |
| Finance income / (costs) | 979 | 1632 | 392 | 18 | (246870) | 249675 | 5826 |
| **Net finance income / (costs)** | **979** | **1632** | **392** | **18** | **(246870)** | **249675** | **5826** |
| **NET INCOME/(LOSS) BEFORE TAX** | **14294** | **(10042)** | **(1908)** | **(5503)** | **(255444)** | **249675** | **(8928)** |
| Income tax benefit/(expense) | (1500) | (8) | 187 | 15 | 7819 | - | 6513 |
| **NET INCOME/(LOSS) FOR THE YEAR** | **12794** | **(10050)** | **(1721)** | **(5488)** | **(247625)** | **249675** | **(2415)** |
| Attributable to equity holders of the parent | 12794 | (10052) | (1721) | (5488) | (247625) | 249675 | (2417) |
| Attributable to non-controlling interest |  | 2 |  |  |  |  | 2 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** | **For the year ended December 31, 2022** |
| <br>**(in thousands of euros)** | **Spain** | **Mexico** | **Colombia** | **Other Operations** | **Supporting** | **Intercompany eliminations<sup>(1)</sup>** | **Total** |
| **Revenue** | **60043** | **45518** | **7007** | **3179** | **56310** | **(56310)** | **115747** |
| Personnel expenses | (559) | (1184) | (178) | (875) | (12505) |  | (15301) |
| Depreciation and amortization | (51) | (21) | (4) | (125) | (355) |  | (556) |
| Other operating expenses | (53521) | (74074) | (14315) | (9383) | (60770) | 56298 | (155765) |
| **Operating expenses** | **(54131)** | **(75279)** | **(14497)** | **(10383)** | **(73630)** | **56298** | **(171622)** |
| **OPERATING INCOME/(LOSS)** | **5912** | **(29761)** | **(7490)** | **(7204)** | **(17320)** | **(12)** | **(55875)** |
| Finance income / (costs) | 255 | 642 | (299) | 1634 | (32058) | 42286 | 12460 |
| **Net finance income / (costs)** | **255** | **642** | **(299)** | **1634** | **(32058)** | **42286** | **12460** |
| **NET INCOME/(LOSS) BEFORE TAX** | **6167** | **(29119)** | **(7789)** | **(5570)** | **(49378)** | **42274** | **(43415)** |
| Income tax benefit/(expense) | (576) | 10 | (4) | (4) | (2406) | 12 | (2968) |
| **NET INCOME/(LOSS) FOR THE YEAR** | **5591** | **(29109)** | **(7793)** | **(5574)** | **(51784)** | **42286** | **(46383)** |
| Attributable to equity holders of the parent | 5591 | (29108) | (7793) | (5574) | (51784) | 42286 | (46382) |
| Attributable to non-controlling interest |  | (1) |  |  |  |  | (1) |

---

(1) Inter-segment transactions are carried out on an arm's length basis and are included in the "Intercompany eliminations" column.

[**Table of Contents**](#toc)

***Revenue***

Revenue increased €45.9 million, or 40.5%, to €161.6 million for the year ended December 31, 2023 from €115.7 million for the year ended December 31, 2022, primarily due to the increase in revenue in Mexico and Spain as set forth below.

For the year ended December 31, 2023 and the year ended December 31, 2022, online sports betting revenue amounted to €73.1 million and €58.5 million, respectively, and online casino wagering revenue amounted to €88.6 million and €57.3 million, respectively.

The following table sets forth the distribution of our revenues by operating segment for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Spain | 75669 | 60043 | 15626 | 26.0% |
| Mexico | 73315 | 45518 | 27797 | 61.1% |
| Colombia | 8581 | 7007 | 1574 | 22.5% |
| Other Operations | 4082 | 3179 | 903 | 28.4% |
| Supporting Entities | 45263 | 56310 | (11047) | (19.6)% |
| Intercompany eliminations | (45263) | (56310) | 11047 | 19.6% |
| **Total** | **161647** | **115747** | **45900** | **39.7%** |

---

Revenue in Spain increased €15.6 million, or 26.0%, to €75.7 million for the year ended December 31, 2023 from €60.0 million for the year ended December 31, 2022. This increase was primarily due to an increase in online casino wagering, mainly due to the acquisition of casino first players, crossing sports betting customers over to casino to maximize overall player yield, as well as a 15% increase in the number of active players.

Revenue in Mexico increased €27.8 million, or 61.1%, to €73.3 million for the year ended December 31, 2023 from €45.5 million for the year ended December 31, 2022. This increase was primarily driven by a 25% increase in the number of active players and a 41% higher spend per active customer. During 2023, revenue from online casino wagering increased by €19.1 million, while revenue from online sports betting increased by €8.7 million.

Revenue in Colombia increased €1.6 million, or 22.5%, to €8.6 million for the year ended December 31, 2023 from €7.0 million for the year ended December 31, 2022. This increase was driven by improved quality of our customer acquisitions and, as a result, portfolio of active customers. During 2023, revenue from online casino wagering increased by €1.0 million, while revenue from online sports betting increased by €0.6 million. Codere Online increased its focus on targeted promotional initiatives and marketing campaigns, including sponsorships with certain celebrities in Colombia.

Revenue from Other Operations increased €0.9 million, or 28.4%, to €4.1 million for the year ended December 31, 2023 from €3.2 million for the year ended December 31, 2022. This increase was primarily driven by Codere Online's operations in the City of Buenos Aires (Argentina) and Panamá.

***Personnel expenses***

Personnel expenses increased €2.1 million, or 14.0 %, to €17.4 million for the year ended December 31, 2023 from €15.3 million for the year ended December 31, 2022. This increase was primarily due to the increase in the number of personnel.

***Depreciation and amortization***

Depreciation and amortization decreased €0.4 million, or 79.5%, to €0.1 million for the year ended December 31, 2023 from €0.6 million for the year ended December 31, 2022. The decrease was primarily due to the fact that certain intangible assets were fully amortized in 2022.

[**Table of Contents**](#toc)

***Other operating expenses***

Other operating expenses increased €3.1 million, or 2.0%, to €158.9 million for the year ended December 31, 2023 from €155.8 million for the year ended December 31, 2022. The increase was primarily due to an increase in gambling taxes and professional services and other expenses partially offset by a significant decrease in marketing expenses.

The following table sets forth the breakdown of our other operating expenses for the year ended December 31, 2023 and the year ended December 31, 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Gambling taxes | 16281 | 11529 | 4752 | 41.2% |
| Leases | 528 | 526 | 2 | 0.4% |
| Utilities, repairs and maintenance | 1432 | 1059 | 373 | 35.2% |
| Professional services and other expenses | 59203 | 49396 | 9807 | 19.9% |
| Casino license royalties | 6279 | 4843 | 1436 | 29.7% |
| Marketing expenses | 75127 | 88412 | (13285) | (15.0)% |
| **Total** | **158850** | **155765** | **3085** | **2.0%** |

---

Professional services and other expenses increased €9.8 million, or 19.9%, to €59.2 million for the year ended December 31, 2023 from €49.4 million for the year ended December 31, 2022. This increase was primarily a result of additional professional services required in connection with the expansion of the business, especially legal, audit and consulting expenses.

Codere Online believes that marketing is a major driver of growth for its business. Codere Online focuses on traditional marketing (including TV, radio and press), digital marketing (including paid media, social media and affiliation networks) and sports sponsorships. Marketing expenses decreased €13.3 million, or 15.0%, to €75.1 million for the year ended December 31, 2023 from €88.4 million for the year ended December 31, 2022.

Codere Online has begun shifting its priority from primarily pursuing revenue growth to also focusing on profitability and sustainability of its operations and is in the process of improving the efficiency of its marketing and promotion activities.

The following table sets forth the distribution of our other operating expenses by operating segment for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Spain | 60362 | 53521 | 6841 | 12.8% |
| Mexico | 83181 | 74074 | 9107 | 12.3% |
| Colombia | 10587 | 14315 | (3728) | (26.0)% |
| Other operations | 8897 | 9383 | (486) | (5.2)% |
| Supporting | 41086 | 60770 | (19684) | (32.4)% |
| Intercompany eliminations | (45263) | (56298) | 11035 | 19.6% |
| **Total** | **158850** | **155765** | **3085** | **2.0%** |

---

Other operating expenses in Spain increased €6.8 million, or 12.8%, to €60.4 million for the year ended December 31, 2023 from €53.5 million for the year ended December 31, 2022. This increase was primarily due to the increase in professional services and other expenses from €3.4 million in 2022 to €16.9 million in 2023.

[**Table of Contents**](#toc)

Other operating expenses in Mexico increased €9.1 million, or 12.3%, to €83.2 million for the year ended December 31, 2023 from €74.1 million for the year ended December 31, 2022. This increase was primarily due to the increase in gambling taxes from €3.3 million in 2022 to €6.4 million in 2023. Codere Online concentrated its marketing efforts in Mexico in 2023, where it deployed a significant amount of its marketing spend for a total of €46.0 million, or 61.2% of total marketing expense. Despite this, marketing expenses in Mexico decreased by €1.2 million to €46.0 million for the year ended December 31, 2023 from €47.2 million for the year ended December 31, 2022.

Other operating expenses in Colombia decreased €3.7 million, or 26.0%, to €10.6 million for the year ended December 31, 2023 from €14.3 million for the year ended December 31, 2022. This decrease was primarily due to a reduction in marketing spend of €6.5 million in 2023, from €8.8 million for the year ended December 31, 2022, to €2.3 million for the year ended December 31, 2023.

Other operating expenses incurred by the Other Operations segment decreased €0.5 million, or 5.2%, to €8.9 million for the year ended December 31, 2023 from €9.4 million for the year ended December 31, 2022. This decrease was primarily due to the decrease in marketing expenses from €7.5 million in 2022 to €4.4 million in 2023.

Other operating expenses incurred by the Supporting Entities segment decreased €19.7 million, or 32.4%, to €41.1 million for the year ended December 31, 2023 from €60.8 million for the year ended December 31, 2022. This decrease was primarily driven by the decrease in professional services and marketing expenses.

***Operating loss***

As a result of the foregoing, operating loss decreased €41.1 million, or 73.6%, to €14.8 million for the year ended December 31, 2023 from €55.9 million for the year ended December 31, 2022.

***Finance income / (costs)***

Finance income decreased €6.6 million, or 53.2%, to €5.8 million for the year ended December 31, 2023 from finance income of €12.5 million for the year ended December 31, 2022. The decrease was primarily due to negative foreign exchange differences resulting from the fluctuation of the exchange rates between the euro and the other currencies, mainly the Mexican peso, Colombian peso and the Argentine peso and Panamanian balboa. The negative exchange rate impact amounted to approximately €2.0 million for the year ended December 31, 2023. Additionally, finance income was recorded for the year ended December 31, 2023 due to hyperinflation adjustment in Argentina which amounted €5.3 million and due to the change in the fair value of Codere Online Warrants which amounted €0.9 million. On December 31, 2022, the market price of the Codere Online Warrants was approximately €0.20 per Codere Online Warrant or €1.3 million in the aggregate. As of December 31, 2023, the market price decreased to approximately €0.07 per Codere Online Warrant or €0.4 million in the aggregate. Therefore, as of December 31, 2023, the fair value of the warrant liabilities amounted to approximately €0.4 million. The change in fair value of the Codere Online Warrants between December 31, 2022 and December 31, 2023 was recorded in the consolidated statement of operations as finance income amounting to approximately €0.9 million for the year ended December 31, 2023.

***Net loss before tax***

As a result of the foregoing, net loss before tax decreased €34.5 million, or 79.4%, to €8.9 million loss for the year ended December 31, 2023 from €43.4 million loss for the year ended December 31, 2022.

***Income tax benefit / (expense)***

Income tax benefit increased €9.5 million, or 319.4% to €6.5 million for the year ended December 31, 2023 from €3.0 million income tax expense for the year ended December 31, 2022. This was primarily due to the fact that Codere Online had a lower net loss before tax for the year ended December 31, 2023 as compared to the year ended December 31, 2022 and recognized new deferred tax assets.

[**Table of Contents**](#toc)

***Net loss for the period***

As a result of the foregoing, net loss for the period decreased €44.0 million, or 94.8%, to €2.4 million for the year ended December 31, 2023 from €46.4 million for the year ended December 31, 2022.

**Non-GAAP Financial Data**

In addition to the measures expressly defined in the IFRS, Codere Online also uses certain non-GAAP measures such as EBITDA and net gaming revenue, for decision-making. These non-GAAP financial measures are being presented because they provide Codere Online's management and readers with additional insight into Codere Online's operational performance relative to historical periods and relative to its competitors. These non-GAAP financial measures are not measures of financial performance in accordance with U.S. GAAP or IFRS and may exclude items that are significant in understanding and assessing Codere Online's financial results. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures. These non-GAAP financial measures are not a substitute for any IFRS financial information. Readers should use these non-GAAP financial measures only in conjunction with the comparable IFRS financial measures. Reconciliations of EBITDA to Net Income/(Loss), and net gaming revenue to revenue, the most comparable IFRS measures, respectively, are provided below.

Codere Online believes EBITDA and net gaming revenue are useful in evaluating Codere Online's operating performance, as they are similar to measures reported by its public competitors and are regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. EBITDA and net gaming revenue are not intended to be substitutes for any IFRS financial measure and, as calculated, may not be comparable to other similarly-titled measures of performance of other companies in other industries or within the same industry. EBITDA and net gaming revenue should not be viewed in isolation or as a substitute for the measures presented according to IFRS.

***EBITDA***

EBITDA is calculated as net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization.

***Comparison of the year ended December 31, 2024 to the year ended December 31, 2023***

The following table sets forth a reconciliation of EBITDA to net income/(loss) for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | 3910 | (2415) | 6325 | 261.9% |
| Interest (income) / expense<sup>(1)</sup> | (1041) | (5826) | 4785 | 82.1% |
| Income tax expense / (benefit) | 1462 | (6513) | 7975 | 122.4% |
| Depreciation and amortization | 388 | 114 | 274 | 240.4% |
| **EBITDA** | **4719** | **(14640)** | **19359** | **132.2%** |

---

(1) Interest (income) / expense was calculated by summing all interest (income) / expense accounts that are included within finance costs in the consolidated statements of operations for the years ended December 31, 2024 and 2023.

[**Table of Contents**](#toc)

The following table sets forth EBITDA by operating segment for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Spain | 17632 | 13339 | 4293 | 32.2% |
| Mexico | (2369) | (11642) | 9273 | 79.7% |
| Colombia | 1312 | (2298) | 3610 | 157.1% |
| Other Operations | (5848) | (5515) | (333) | (6.0)% |
| Supporting Entities | (6008) | (8524) | 2516 | 29.5% |
| **EBITDA** | **4719** | **(14640)** | **19359** | **132.2%** |

---

*Spain*

EBITDA from Spain corresponds to net income/(loss), after adding back interest (income) / expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Spain.

The following table provides a reconciliation of EBITDA from Spain to net income/(loss) from Spain for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | 15391 | 12794 | 2597 | 20.3% |
| Interest (income) / expense | (2036) | (979) | (1057) | (108.0)% |
| Income tax expense / (benefit) | 4154 | 1500 | 2654 | 176.9% |
| Depreciation and amortization | 123 | 24 | 99 | n.m. |
| **EBITDA from Spain** | **17632** | **13339** | **4293** | **32.2%** |

---

EBITDA from Spain increased €4.3 million to €17.6 million for the year ended December 31, 2024 from €13.3 million for the year ended December 31, 2023. The year-on-year change was primarily due to an increase in operating income from €13.3 million for the year ended December 31, 2023 to €17.5 million for the year ended December 31, 2024. The increase in operating income was primarily a result of the revenue increase from €75.7 million for the year ended December 31, 2023 to €87.8 million for the year ended December 31, 2024 explained above partially offset by an increase in other operating expenses of €7.4 million. The increase in other operating expenses was primarily due to the increase in marketing expenses from €23.0 million in 2023 to €27.2 million in 2024.

*Mexico*

EBITDA from Mexico corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Mexico.

The following table provides a reconciliation of EBITDA from Mexico to net income/(loss) from Mexico for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | (5322) | (10050) | 4728 | 47.0% |
| Interest (income) / expense | 2930 | (1632) | 4562 | n.m. |
| Income tax expense / (benefit) | (7) | 8 | (15) | n.m. |
| Depreciation and amortization | 30 | 32 | (2) | (6.3)% |
| **EBITDA from Mexico** | **(2369)** | **(11642)** | **9273** | **79.7%** |

---

[**Table of Contents**](#toc)

EBITDA from Mexico increased €9.3 million to negative EBITDA of €2.4 million for the year ended December 31, 2024 from negative EBITDA of €11.6 million for the year ended December 31, 2023. The year-on-year change was primarily due to a decrease in operating loss from €11.7 million for the year ended December 31, 2023 to €2.4 million for the year ended December 31, 2024, which was driven mainly by an increase in revenue of €22.4 million partially offset by an increase in other operating expenses of €13.1 million. The increase in other operating expenses was related primarily to the increase in marketing expenses of €4.6 million during 2024.

*Colombia*

EBITDA from Colombia corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Colombia.

The following table provides a reconciliation of EBITDA from Colombia to net income/(loss) from Colombia for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | 1001 | (1721) | 2722 | 158.2% |
| Interest (income) / expense | 310 | (392) | 702 | 179.1% |
| Income tax expense / (benefit) | (1) | (187) | 186 | 99.5% |
| Depreciation and amortization | 2 | 2 | - |  |
| **EBITDA from Colombia** | **1312** | **(2298)** | **3610** | **157.1%** |

---

EBITDA from Colombia increased €3.6 million to positive EBITDA of €1.3 million for the year ended December 31, 2024 from negative EBITDA of €2.3 million for the year ended December 31, 2023. The increase was primarily due to an increase in operating income/(loss) from negative €2.3 million to positive €1.3 million, which was driven mainly by a decrease in other operating expenses of €1.6 million and an increase in revenue of €2 million. The decrease in other operating expenses was related primarily to the decrease in marketing expenses during 2024 of €1.0 million and the decrease in professional services and other expenses from €4.2 million in 2023 to €2.8 million in 2024 (on a gross basis, before intercompany eliminations).

*Other operations*

EBITDA from Other operations corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Panama and Argentina.

The following table provides a reconciliation of EBITDA from Other operations to net income/(loss) from the Other operations entities segment for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | 19 | (5488) | 5507 | 100.3% |
| Interest (income) / expense | (5848) | (18) | (5830) | n.m. |
| Income tax expense / (benefit) | (26) | (15) | (11) | (73.3)% |
| Depreciation and amortization | 7 | 6 | 1 | 16.7% |
| **EBITDA from Other operations** | **(5848)** | **(5515)** | **(333)** | **(6.0)%** |

---

[**Table of Contents**](#toc)

EBITDA from Other operations decreased €0.3 million to negative EBITDA of €5.8 million for the year ended December 31, 2024 from negative EBITDA of €5.5 million for the year ended December 31, 2023. The decrease in EBITDA from Other operations was primarily driven by a €2.8 million increase in operating expenses, partially offset by a €2.5 million increase in revenue. The increase in operating expenses was mainly due to a €1.9 million increase in marketing expenses, from €5.6 million in 2023 to €7.5 million in 2024.

*Supporting Entities*

EBITDA from the Supporting Entities segment corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Malta, Gibraltar, Israel, Spain and the United States.

The following table provides a reconciliation of EBITDA from the Supporting Entities segment to net income/(loss) from the Supporting Entities segment for the years ended December 31, 2024 and 2023.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **€** | **%** |
| Net income / (loss) for the year | (7180) | (247625) | 240445 | 97.1% |
| Interest (income) / expense | 3604 | 246870 | (243266) | (98.5)% |
| Income tax expense / (benefit) | (2658) | (7819) | 5161 | 66.0% |
| Depreciation and amortization | 226 | 50 | 176 | n.m. |
| **EBITDA from the Supporting Entities** | **(6008)** | **(8524)** | **2516** | **29.5%** |

---

EBITDA from the Supporting Entities segment increased €2.5 million to negative EBITDA of €6.0 for the year ended December 31, 2024 from negative EBITDA of €8.5 million for the year ended December 31, 2023. The primary driver of the increase relates to a decrease in operating loss from €8.6 million to €6.2 million, which is mainly due to an increase in revenues of €6.9 million, partially offset by an increase in other operating expenses of €3.8 million in 2024.

***Comparison of the year ended December 31, 2023 to the year ended December 31, 2022***

The following table sets forth a reconciliation of EBITDA to net income/(loss) for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | (2415) | (46383) | 43968 | 94.8% |
| Interest (income) / expense<sup>(1)</sup> | (5826) | (32) | (5794) | n.m. |
| Income tax expense / (benefit) | (6513) | 2968 | (9481) | n.m. |
| Depreciation and amortization | 114 | 556 | (442) | (79.5)% |
| **EBITDA** | **(14640)** | **(42891)** | **28251** | **65.9%** |

---

(1) Interest (income) / expense was calculated by summing all interest (income) / expense accounts that are included within finance costs in the consolidated statement of operations for the year ended December 31, 2023 and carve-out income statement for the year ended December 31, 2022.

[**Table of Contents**](#toc)

The following table sets forth EBITDA by operating segment for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Spain | 13339 | 6218 | 7121 | 114.5% |
| Mexico | (11642) | (27292) | 15650 | 57.3% |
| Colombia | (2298) | (7731) | 5433 | 70.3% |
| Other Operations | (5515) | (5053) | (462) | (9.1)% |
| Supporting Entities | (8524) | (44788) | 36264 | 81.0% |
| Intercompany eliminations | - | 35755 | (35755) | (100)% |
| **EBITDA** | **(14640)** | **(42891)** | **28251** | **65.9%** |

---

*Spain*

EBITDA from Spain corresponds to net income/(loss), after adding back interest (income) / expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Spain.

The following table provides a reconciliation of EBITDA from Spain to net income/(loss) from Spain for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | 12794 | 5591 | 7203 | 128.8% |
| Interest (income) / expense | (979) |  | (979) | (100)% |
| Income tax expense / (benefit) | 1500 | 576 | 924 | 160.4% |
| Depreciation and amortization | 24 | 51 | (27) | (52.9)% |
| **EBITDA from Spain** | **13339** | **6218** | **7121** | **114.5%** |

---

EBITDA from Spain increased €7.1 million to €13.3 million for the year ended December 31, 2023 from €6.2 million for the year ended December 31, 2022. The year-on-year change was primarily due to an increase in operating income from €5.9 million for the year ended December 31, 2022 to €13.3 million for the year ended December 31, 2023. The increase in operating income was primarily a result of the revenue increase from €60.0 million for the year ended December 31, 2022 to €75.7 million for the year ended December 31, 2023 explained above partially offset by an increase in other operating expenses of €6.8 million. The increase in other operating expenses was primarily due to the increase in professional services and other expenses from €3.4 million in 2022 to €16.9 million in 2023.

*Mexico*

EBITDA from Mexico corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Mexico.

[**Table of Contents**](#toc)

The following table provides a reconciliation of EBITDA from Mexico to net income/(loss) from Mexico for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | (10050) | (29109) | 19059 | 65.5% |
| Interest (income) / expense | (1632) | 1805 | (3437) | n.m. |
| Income tax expense / (benefit) | 8 | (10) | 18 | n.m. |
| Depreciation and amortization | 32 | 21 | 11 | 52.4% |
| **EBITDA from Mexico** | **(11642)** | **(27293)** | **15651** | **57.3%** |

---

EBITDA from Mexico increased €15.7 million to negative EBITDA of €11.6 million for the year ended December 31, 2023 from negative EBITDA of €27.3 million for the year ended December 31, 2022. The year-on-year change was primarily due to a decrease in operating loss from €29.8 million for the year ended December 31, 2022 to €11.7 million for the year ended December 31, 2023, which was driven mainly by an increase in revenue of €27.8 million partially offset by an increase in other operating expenses of €9.1 million. The increase in other operating expenses was related primarily to the increase in gambling taxes of €3.1 million during 2023.

*Colombia*

EBITDA from Colombia corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Colombia.

The following table provides a reconciliation of EBITDA from Colombia to net income/(loss) from Colombia for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | (1721) | (7793) | 6072 | 77.9% |
| Interest (income) / expense | (392) | 54 | (446) | n.m. |
| Income tax expense / (benefit) | (187) | 4 | (191) | n.m. |
| Depreciation and amortization | 2 | 4 | (2) | (50.0)% |
| **EBITDA from Colombia** | **(2298)** | **(7731)** | **5433** | **70.3%** |

---

EBITDA from Colombia increased €5.4 million to negative EBITDA of €2.3 million for the year ended December 31, 2023 from negative EBITDA of €7.7 million for the year ended December 31, 2022. The increase was primarily due to a decrease in operating loss from €7.5 million to €2.3 million, which was driven mainly by a decrease in other operating expenses of €3.7 million and an increase in revenue of €1.6 million. The decrease in other operating expenses was related primarily to the decrease in marketing expenses during 2023 of €6.5 million and the increase in professional services and other expenses from €2.1 million in 2022 to €4.2 million in 2023 (on a gross basis, before intercompany eliminations).

[**Table of Contents**](#toc)

*Other operations*

EBITDA from Other operations corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Panama and Argentina.

The following table provides a reconciliation of EBITDA from Other operations to net income/(loss) from the Other operations entities segment for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | (5488) | (5574) | 86 | 1.5% |
| Interest (income) / expense | (18) | 392 | (410) | (104.6)% |
| Income tax expense / (benefit) | (15) | 4 | (19) | n.m. |
| Depreciation and amortization | 6 | 125 | (119) | (95.2)% |
| **EBITDA from Other operations** | **(5515)** | **(5053)** | **(462)** | **(9.1)%** |

---

EBITDA from Other operations decreased €0.5 million to negative EBITDA of €5.5 million for the year ended December 31, 2023 from negative EBITDA of €5.1 million for the year ended December 31, 2022. The decrease in EBITDA from Other operations was primarily due to a decrease in net finance income, from €0.4 million in 2022 to close to nil in 2023. This decline in net finance income more than offset the positive impact from a decrease in operating loss from €7.2 million to €5.5 million, which was driven mainly by a reduction in other operating expenses of €0.5 million, alongside an increase in revenue of €0.9 million. This decrease in other operating expenses was primarily due to the decline in marketing expenses from €7.5 million in 2022 to €4.4 million in 2023.

*Supporting Entities*

EBITDA from the Supporting Entities segment corresponds to net income/(loss), after adding back interest expense, income tax expense (benefit) and depreciation and amortization from Codere Online's assets based in Malta, Gibraltar, Israel, Spain and the United States.

The following table provides a reconciliation of EBITDA from the Supporting Entities segment to net income/(loss) from the Supporting Entities segment for the years ended December 31, 2023 and 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the<br>year ended<br>December 31,** | **For the<br>year ended<br>December 31,** | **Change** | **Change** |
| <br>**(in thousands of euros)** | **2023** | **2022** | **€** | **%** |
| Net income / (loss) for the year | (247625) | (51784) | (195841) | n.m. |
| Interest (income) / expense | 246870 | 4235 | 242635 | n.m. |
| Income tax expense / (benefit) | (7819) | 2406 | (10225) | n.m. |
| Depreciation and amortization | 50 | 355 | (305) | (85.9)% |
| **EBITDA from the Supporting Entities** | **(8524)** | **(44788)** | **36264** | **81.0%** |

---

[**Table of Contents**](#toc)

EBITDA from the Supporting Entities segment increased €36.3 million to negative EBITDA of €8.5 for the year ended December 31, 2023 from negative EBITDA of €44.8 million for the year ended December 31, 2022. The primary driver of the decrease relates to a decrease in operating loss from €17.3 million to €8.6 million, which was driven mainly by an increase in net financial costs from €32.1 million to €246.9 million and decrease in revenues of €11.0 million partially offset by a decrease in other operating expenses of €19.7 million. The increase in finance costs of the Supporting entities does not substantially affect the consolidated results because 99.1% (€273.1 million) of such costs is eliminated due to intercompany eliminations.

***Net Gaming Revenue***

Net gaming revenue is calculated as all gross amounts wagered of Codere Online less: (i) player wins, (ii) player bonuses and (iii) promotional bets, subject to certain adjustments.

The following table sets forth the distribution of our revenue and net gaming revenue by segment for the years ended December 31, 2024, 2023 and 2022.

---

| | | | |
|:---|:---|:---|:---|
| | **For the<br> year ended<br>December 31,** | **For the<br> year ended<br>December 31,** | **For the<br> year ended<br>December 31,** |
| <br>**(in millions of euros)** | **2024** | **2023** | **2022** |
| **Revenue** |  |  |  |
| Spain | 87.8 | 75.7 | 60.0 |
| Mexico | 95.7 | 73.3 | 45.5 |
| Colombia | 10.6 | 8.5 | 7.0 |
| Panama | 3.1 | 2.4 | 1.7 |
| Other<sup>(1)</sup> | 3.5 | 1.7 | 1.5 |
| **Total** | **200.7** | **161.6** | **115.7** |
| **Net Gaming Revenue** |  |  |  |
| Spain | 87.7 | 75.7 | 60.0 |
| Mexico | 106.6 | 81.7 | 51.1 |
| Colombia | 10.6 | 8.5 | 7.9 |
| Panama | 3.6 | 2.8 | 1.9 |
| Other<sup>(1)(2)</sup> | 3.5 | 3.2 | 2.0 |
| **Total** | **212.0** | **171.9** | **122.9** |

---

Note: Amounts in the table above have been subject to rounding adjustments.

(1) Includes Other Operations, Supporting Entities and intercompany eliminations.

[**Table of Contents**](#toc)

The following table reconciles the total net gaming revenue figures shown above with Codere Online's revenue for the periods indicated.

---

| | | | |
|:---|:---|:---|:---|
| | **For the<br> year ended<br>December 31,** | **For the<br> year ended<br>December 31,** | **For the<br> year ended<br>December 31,** |
| <br>**(in millions of euros)** | **2024** | **2023** | **2022** |
| **Revenue** | **200.7** | **161.6** | **115.7** |
| Accounting Adjustments<sup>(1)</sup> | 11.3 | 10.3 | 7.2 |
| **Net Gaming Revenue** | **212.0** | **171.9** | **122.9** |
| **Revenue (Spain)** | **87.8** | **75.7** | **60.0** |
| Accounting Adjustments | **(0.1)** | - | - |
| **Net Gaming Revenue (Spain)** | **87.7** | **75.7** | **60.0** |
| **Revenue (Mexico)** | **95.7** | **73.3** | **45.5** |
| Accounting Adjustments<sup>(1)</sup> | 10.9 | 8.4 | 5.6 |
| **Net Gaming Revenue (Mexico)** | **106.6** | **81.7** | **51.1** |
| **Revenue (Colombia)** | **10.6** | **8.5** | **7.0** |
| Accounting Adjustments<sup>(1)</sup> | **-** | - | 0.9 |
| **Net Gaming Revenue (Colombia)** | **10.6** | **8.5** | **7.9** |
| **Revenue (Panama)** | **3.1** | **2.4** | **1.7** |
| Accounting Adjustments<sup>(1)</sup> | 0.5 | 0.4 | 0.2 |
| **Net Gaming Revenue (Panama)** | **3.6** | **2.8** | **1.9** |
| **Revenue (Other)**<sup>(2)</sup>** | **3.5** | **1.7** | **1.5** |
| Accounting Adjustments<sup>(1)</sup> | - | 1.5 | 0.5 |
| **Net Gaming Revenue (Other)**<sup>(2)</sup>** | **3.5** | **3.2** | **2.0** |

---

Note: Amounts in the table above have been subject to rounding adjustments.

(1) Accounting adjustments primarily reflect differences in recognition of revenue related to the value added tax (VAT) impact from entry fees in Mexico, certain partner and affiliate agreements in place in Colombia, the invoicing of certain operational and advisory services in Panama (under the Panama Restructuring Agreements) and the impact from the application of inflation accounting (IAS 29) in Argentina.

(2) Includes Other Operations (excluding Panama), Supporting Entities and intercompany eliminations.

[**Table of Contents**](#toc)

**B.** **Liquidity and Capital Resources** 

***Liquidity***

In 2024, for the first time Codere Online obtained profits in the operation of its business driven primarily by its increase in revenue.

Codere Online measures liquidity in terms of its ability to fund the cash requirements of its business operations, including working capital needs, contractual obligations and other commitments, with cash flows from operations and other sources of funding. Since inception and up to the consummation of the Business Combination on November 30, 2021, Codere Online has funded the cash requirements of its business operations primarily through cash flows from operations and shareholder contributions and other financing obtained from the Codere Group.

Upon the consummation of the Business Combination on November 30, 2021, Codere Online received approximately $116 million in cash (approximately $103 million net of transaction fees and expenses). Codere Online had €40.3 million in cash and cash equivalents as of December 31, 2024 (€41.3 million as of December 31, 2023), of which €5.1 million was reserved (€5.2 million as of December 31, 2023). Reserved cash corresponds to customer balances from certain jurisdictions where the regulation requires Codere Online to reserve cash equal to the amount the customer has in the virtual wallet. Based on the above and on its current level of operations, Codere Online believes that cash on hand and cash generated from operations will be adequate to meet its anticipated obligations under its contracts, borrowings requirements and working capital needs for the next twelve months. However, Codere Online cannot provide any assurance that this will be the case or that Codere Online will be commercially successful or achieve or sustain profitability in the future.

Codere Online had positive equity of €24.2 million as of December 31, 2024 (positive equity of €21.3 million as of December 31, 2023). The increase in equity as of December 31, 2024 of €2.9 million compared to December 31, 2023 was primarily due to the net income recorded for the year ended December 31, 2024.

Codere Online had positive working capital amounting to €18.0 million as of December 31, 2024 (positive working capital amounting to €13.2 million as of December 31, 2023). The increase in working capital from December 31, 2023 to December 31, 2024 was primarily due to the net reduction on trade payables and other current liabilities and the net increase in current financial assets See Notes 8 and 10 to the Annual Financial Statements beginning on page F-34 and page F-36, respectively, for further information related to these proceeds.

***Indebtedness***

As of December 31, 2024 and 2023, Codere Online's indebtedness primarily consisted of current financial liabilities in the form of borrowings with related parties and non-current financial liabilities in the form of warrants.

Codere Online's borrowings, which amounted to €3.4 million as of December 31, 2024 (€5.1 million as of December 31, 2023), consisted of €3.4 million of current borrowings (€5.1 million as of December 31, 2023) and were related to short-term loans, mainly composed of debt with entities from the Codere Group. As of December 31, 2024, December 31, 2023, there were no non-current borrowings.

[**Table of Contents**](#toc)

Codere Online had the following intra-group current financial liabilities as of December 31, 2024, all of which were with entities of the Codere Group.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related company** | **Other current<br> assets** | **Trade<br> receivables** | **Current<br> borrowings** | **Trade payables<br> and other<br> current liabilities** |
|  | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** |
| Codere Newco S.A.U. | 320 |  | 2 | 1035 |
| Codere Apuestas España S.L. (CAES) |  | 75 |  | 698 |
| Other retail companies |  | 173 | 175 | 956 |
| Other Latam retail companies |  | 38 | 1436 | 424 |
| Codere Colombia, S.A. |  | 654 | 283 | 599 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. |  | 209 | 1460 | 246 |
| Other | - | - | 9 | - |
| **Total** | **320** | **1149** | **3365** | **3958** |

---

Codere Online had the following intra-group current financial liabilities as of December 31, 2023, all of which were with entities of the Codere Group.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related company** | **Other current<br> assets** | **Trade<br> receivables** | **Current<br> borrowings** | **Trade payables<br> and other<br> current liabilities** |
|  | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** |
| Codere Newco S.A.U. |  | 3859 |  | 4626 |
| Codere Apuestas España S.L. (CAES) |  | 2011 |  | 2221 |
| Other retail companies |  | 935 | 637 | 1272 |
| Other Latam retail companies |  | 13 | 2618 | 835 |
| Codere Colombia, S.A. |  | 612 | 325 | 425 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. |  | 717 | 1517 | 291 |
| Other |  | - | 8 | - |
| **Total** |  | **8147** | **5105** | **9670** |

---

During 2024 and 2023, Codere Online maintained its non-current debt with Codere Group entities at zero. Codere Online current borrowings with group entities amounted to €3.4 million at December 31, 2024, mainly due to the €1.4 million granted by Libros Foráneos, S.A. de C.V. AenP, the Mexican subsidiary of the Codere Group, followed by €1.5 million granted by ALTA/HIPA.

During 2023, Codere Online maintained its non-current debt with Codere Group entities at zero. Codere Online current borrowings with group entities amounted to €5.1 million at December 31, 2023, mainly due to the €2.6 million granted by Libros Foráneos, S.A. de C.V. AenP, the Mexican subsidiary of the Codere Group, followed by €1.5 million granted by ALTA/HIPA.

[**Table of Contents**](#toc)

**Cash Flows Summary**

Presented below is a summary of Codere Online's consolidated operating, investing and financing cash flows for the periods indicated:

---

| | | | |
|:---|:---|:---|:---|
| | **For the<br> Year Ended<br>December 31,** | **For the<br> Year Ended<br>December 31,** | **For the<br> Year Ended<br>December 31,** |
| <br>**(in thousands of euros)** | **2024** | **2023** | **2022** |
| Net cash provided by/(used in): |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating activities | 3943 | (11580) | (42357) |
| &nbsp;&nbsp;&nbsp;Investing activities | (256) | (245) | (164) |
| &nbsp;&nbsp;&nbsp;Financing activities | (2042) | 1330 |  |
| Effect of exchange rate on cash and cash equivalents | (2616) | (2035) | 1421 |
| **Net change in cash and cash equivalents** | **(971)** | **(12530)** | **(41100)** |

---

***Cash Flows from Operating Activities***

Net cash provided by operating activities was €3.9 million for the year ended December 31, 2024 compared to net cash used in operating activities of €11.6 million for the year ended December 31, 2023. The change of approximately €15.5 million was primarily due to significant increase in our revenue in Spain and Mexico as a result of the increase in the number of customers and spend per customer, together with a lower level of marketing expenses.

Net cash used in operating activities was €11.6 million for the year ended December 31, 2023 compared to net cash used in operating activities of €42.4 million for the year ended December 31, 2022. The change of approximately €30.8 million was primarily due to significant increase in our revenue in Spain and Mexico as a result of the increase in the number of customers and spend per customer, together with a lower level of marketing expenses.

***Cash Flows from Investing Activities***

Net cash used in investing activities was approximately €0.2 million, €0.2 million and €0.2 million for the years ended December 31, 2024, 2023 and 2022, respectively. The Company did not make any significant investments in 2024, 2023 or 2022. Therefore, the cash outflows from investing activities remained stable.

***Cash Flows from Financing Activities***

Net cash used in financing activities was €2.0 million for the year ended December 31, 2024. Net cash provided by financing activities was €1.3 million for the year ended December 31, 2023.

Net cash provided by financing activities was nil for the year ended December 31, 2022.

**Trade Receivables and Other Current Assets**

Codere Online's trade receivables and other current assets, which amounted to €9.1 million as of December 31, 2024, (€13.6 million as of December 31, 2023), consisted primarily of receivables from the Codere Group companies, current tax asset related to value added tax (VAT), prepaid expenses and other receivables. Fluctuations in trade receivables and other current assets were mainly driven by changes in receivables from the Codere Group companies and in the current tax asset related to value added tax (VAT).

[**Table of Contents**](#toc)

**Trade Payables and Other Current Liabilities**

Codere Online's trade payables and other current liabilities, which amounted to €41.2 million as of December 31, 2024 (€47.0 million as of December 31, 2023), consisted of trade payables, customer virtual wallets, accrued expenses and other current liabilities. Fluctuations in trade payables and other current liabilities are mainly driven by the growth of the business.

**Contractual Obligations and Commitments**

The following table summarizes Codere Online's contractual obligations and other commitments for cash expenditures as of December 31, 2024, and the years in which these obligations are due:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Payments Due by Period** | **Payments Due by Period** | **Payments Due by Period** | **Payments Due by Period** |
| <br>**(in thousands of euros)** | **Total** | **Less than<br>1 Year** | **1-5 Years** | **More than<br>5 Years** |
| **Contractual Obligations:** |  |  |  |  |
| Non-current borrowings |  |  |  |  |
| Current borrowings | 3365 | 3365 |  |  |
| **Total** | **3365** | **3365** |  |  |

---

**Off-Balance Sheet Arrangements**

As of December 31, 2024, Codere Online did not have any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

**C.** **Research and development, patents and licenses, etc.** 

We expect that Codere Online will be making selective investments to support the development of its technology platform, as it believes its ability to grow its market position depends, in part, on technologies that allow for more efficient and effective CRM campaigns. These investments would be made either directly by Codere Online and/or indirectly through the Codere Group, which would recover the amount of such investments over a period of between three to five years through service fees as established in the New Platform and Technology Services Agreement.

Codere Online does not currently own any material registered intellectual property. Codere Online's intellectual property portfolio consists substantially of licensed intellectual property, including the "Codere" trademarks licensed pursuant to the Relationship and License Agreement, which agreement is described in Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Relationship and License Agreement."* In addition, pursuant to the Sponsorship and Services Agreement, Codere Online became the licensee of certain rights, marks, names, images, designations, anthems, photographs and brands set forth under the RM Sponsorship Agreement, as well as the licensee or assignee, as applicable, of new sponsorship rights under sponsorship agreements entered into by Codere Newco and certain of its affiliates as negotiated and agreed between SEJO and Codere Newco from time to time (see Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Sponsorship and Services Agreement*"). Furthermore, Codere Newco is the licensee of certain additional intellectual property under the New Platform and Technology Services Agreement, which agreement is described in Item 7.B. "*Related Party Transactions*—*Material Agreements*—*Platform and Technology Services Agreement."* Codere Online also licenses certain third-party intellectual property (such as games) under licenses and service agreements with those third parties, including through agreements with gaming content creators and service providers. For more information, see Item 4.B. "*Business Overview.*"

Codere Online is required to obtain, renew and maintain licenses in order to conduct its operations. Certain of Codere Online's licenses currently require that an operating retail presence be maintained (including, licenses in Mexico, Panama and Colombia). In addition, certain jurisdictions (such as Spain) require game-specific licenses in addition to a general license. For more details on the licenses Codere Online utilizes to operate its business, see Item 4.B. "*Business Overview—Regulation Applicable to Codere Online's Business.*"

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**D.** **Trend Information** 

See Item 5.A. "*Operating Results*."

**E.** **Critical Accounting Policies and Estimates** 

The Annual Financial Statements have been prepared in accordance with IFRS, as issued by the IASB and pursuant to the interpretations issued by the Interpretation Committee of the IASB.

The preparation of these financial statements requires Codere Online to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Codere Online's estimates are based on its historical experience and on various other factors that Codere Online believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions. For a description of the Codere Online's accounting estimates applied in the preparation of the financial statements, see Note 3(m) – *Use of estimates and judgements* to the to the Annual Financial Statements beginning on page F-24. Codere Online did not identify any critical accounting policies or critical accounting estimates for the year ended December 31, 2024.

**Quantitative and Qualitative Disclosures about Market Risk**

Codere Online is exposed to a variety of market and other risks, including the effects of changes in foreign currency exchange rates and liquidity, as well as credit risks and other risks and hazard events.

***Liquidity risk***

Codere Online is exposed to liquidity risk in the event that a mismatch arises between its financing needs, including operating and financial expenses and investments, and its sources of financings, including revenues, divestments and credit lines from financial institutions and financial instruments from related parties (including capital contributions).

Codere Online's general financial policy consists of managing liquidity to ensure that funds required for future obligations are available via cash from operations and, at times, other financing sources from related parties and/or third parties.

***Exchange rate risk***

Codere Online is exposed to exchange rate risk given that its functional currency is the euro and the value of any financial assets and liabilities denominated in a different currency is subject to variations as a result of fluctuations in the relevant exchange rates.

The balances of Codere Online related to foreign currency are not considered significant and are nearly entirely with related parties. With the aim to protect its solvency and financial results, Codere Online actively manages exchange rate risks through internal policies to control the exposure of balances to foreign currency in order to minimize the risks associated with exchange rate variations and optimize its financial costs.

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*Sensitivity analysis*

The following table details the sensitivity of Codere Online's consolidated statements of operations (net income / (loss)) for the years ended December 31, 2024 and 2023 and carve-out income statement (net income / (loss)) for the year ended December 31, 2022, and changes in equity for the years ended December 31, 2024, 2023 and 2022 to a 10% increase and decrease, as indicated below, in the euro against the relevant foreign currencies Colombian peso (COP), Mexican peso (MXN), Israeli new shekel (ILS), United States Dollar (USD) and Argentine peso (ARS). The analysis assumes that all variables, in particular interest rates, remain constant.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2024** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 4580.9 | (380) |  | 380 |  |
| MXN/EUR | 21.31 | 3 |  | (3) |  |
| USD/EUR | 1.04 | (1132) |  | 1132 |  |
| ARS/EUR | 1072.14 | (91) |  | 91 |  |
| ILS/EUR | 3.79 | 141 |  | (141) |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2023** | **Income<br>statement** | **Equity** | **Income<br>statement** | **Equity** |
| COP/EUR | 4223.37 | (218) |  | 218 |  |
| MXN/EUR | 18.67 | 606 |  | (606) |  |
| USD/EUR | 1.11 | 495 |  | (495) |  |
| ARS/EUR | 893.34 | 192 |  | (192) |  |
| ILS/EUR | 4.01 | 12 |  | (12) |  |

---

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2022** | **Income<br>statement** | **Equity** | **Income<br>statement** | **Equity** |
| COP/EUR | 5130.6 | 18 |  | (18) |  |
| MXN/EUR | 20.65 | 938 |  | (938) |  |
| GBP/EUR | 0.88 | 1 |  | (1) |  |
| USD/EUR | 1.07 | 4224 |  | (4224) |  |
| ARS/EUR | 188.96 | 273 |  | (273) |  |
| ILS/EUR | 3.75 | 51 |  | (51) |  |

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***Credit risk***

Codere Online is exposed to the risk of a counterparty to an agreement not complying with its contractual obligations, thus negatively affecting results of operations of Codere Online. Codere Online's main financial assets exposed to credit risk are trade receivables and other current assets and current financial assets.

Impairment provisions are determined on the basis of lifetime expected credit losses, including those expected at the individual level, using reasonable and supportable forward-looking information, based on the best information available at the date of authorizing the financial statements for issue. They are re-estimated at every reporting date on an individual basis, using the following criteria:

● the age of the debt;

● the existence of financial difficulties, including bankruptcy proceedings; and

● an analysis of the debtor's ability to repay the loan extended.

As described in Note 3 to the Annual Financial Statements beginning on page F-14, Codere Online's historical credit loss experience between Codere Group entities is nil. The expected credit loss is estimated based on external risk parameters that are publicly available, such as the probability of default (PD) of the Codere Group and a loss given at default (LGD) of 100%.

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**Item 6. Directors, Senior Management and Employees**

**A.** **Directors and Senior Management** 

**Board of Directors**

As of the date of filing of this annual report, the Codere Online Board is composed of six directors:

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Title** |
| Gonzaga Higuero | 53 | Director and Chairman of the Codere Online Board |
| Moshe Edree | 58 | Director and Executive Vice Chairman of the Codere Online Board |
| Gabriel Sáenz de Buruaga | 54 | Director |
| Borja Fernández | 51 | Director |
| Laurent Teitgen | 46 | Director |
| Daniel Valdez | 43 | Director |

---

Pursuant to the Nomination Agreement, Codere Newco has the right to propose for appointment five (5) directors, with at least two (2) of them having to qualify as independent directors (subject to independence requirements under applicable securities exchange rules that may require a greater number of independent directors). One (1) or more of the Codere Newco Directors may be required by Codere Newco to qualify as a Luxembourg tax resident. After Codere Online's annual meeting of shareholders held in June 2023, Sponsor no longer has the right to appoint any directors to the Codere Online Board.

Pursuant to the Nomination Agreement, Codere Newco will have the right, but not the obligation, to propose for appointment one (1) non-executive, non-independent director as an observer to the audit committee to be appointed by Codere Online's Board, subject to compliance with Rule 10A-3 under the Exchange Act.

The term of office of each director will be for a maximum period of one (1) year until the annual general meeting of the shareholders of Codere Online, which is currently expected to be held in the second quarter of 2025 in each case beginning on the day of his/her appointment.

The following is a brief summary of the business experience of the current members of the Codere Online Board. Unless otherwise indicated, the business address for the members of the Codere Online Board is the same as its business address: 7 rue Robert Stümper, L-2557 Luxembourg, Grand Duchy of Luxembourg.

***Gonzaga Higuero.*** Mr. Higuero took on the position of CEO at Codere Group in July 2023 and currently serves as the Chairman of the Codere Online Board and Chairman of the Codere Group's board of directors. Prior to this role, he held the position of CEO at HTG, Europe's second-largest ambulance company, from 2018. HTG was owned by two PE firms and was subsequently acquired by another PE entity. Before his tenure at HTG, Mr. Higuero held various key positions within Prosegur, spanning the Security and Cash Management divisions. His roles included Managing Director for Europe (2008-2010), Managing Director for South America (2011-2014), and Managing Director for EMEA (2015-2018) at Prosegur Cash, contributing to its successful spin-off and IPO in 2017. Prior to his involvement with Prosegur, he spent five years at the Carrefour Group, where he held several positions in both the retail and online divisions. Mr. Higuero holds an MBA from IESE Business School in Barcelona, as well as a Law Degree and a business diploma from ICADE in Madrid.

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***Moshe Edree***. Mr. Edree serves as the Executive Vice Chairman of the Codere Online Board and as the General Manager of SEJO. Mr. Edree was Codere Online's Chief Executive Officer until March 1, 2023. Prior to that, Mr. Edree led Codere Group's Digital Division since 2018, for which he planned and executed a reorganization process and took on responsibility for developing what today is Codere Online, including the Business Combination that eventually led to Codere Online being Nasdaq listed. Under his leadership, Codere Online increased its revenue every year, including in 2022 in its first full year as a public company. Prior to his involvement in Codere, Mr. Edree had various roles in his around two decades of experience in management and directorship in the online gaming space, in companies such as Ladbrokes, NetPlay TV PLC, Playtech and IMIntermedia Ltd, among others. Mr. Edree holds a Bachelor of Science from the Tel Aviv University and the Holon Institute of Technology in Israel, as well as a Bachelor of Arts from the Pratt University in New York, and a Master of Science in Project Management from the University of Bridgeport (Connecticut).

***Gabriel Saénz de Buruaga.*** Mr. Saenz de Buruaga currently serves as a member of the Codere Online Board. Mr. Saenz de Buruaga is an experienced entrepreneur and digital strategist with a demonstrated history of launching successful projects across the entertainment, advertising and internet industry. Skilled in strategy, digital product development and management of global organizations. He is the Founder and current Co-Chief Executive Officer at Wink Transforming Through Digital and Co-Founder and Academic Board Member of ISDI, a business school. He has also served as Global Co-Chief Executive Officer and Global Chief Operating Officer at Havas Digital, Regional Manager for Spain, Italy and Portugal at Media Contacts as well as Founder and Co-Chief Executive Officer at Sonora. Mr. Saenz de Buruaga holds a Bachelor's Degree in Business Administration from the Universidad del País Vasco and an MBA from IESE Business School.

***Borja Fernández*.** Mr. Fernández serves as a member of the Codere Online Board and as Chairman of the Audit Committee. Mr. Fernández has more than 18 years of experience as Director in multiple boards and across different sectors as well as over 25 years of private equity, structured finance, capital markets (equity and debt) and corporate CFO experience. He currently serves as General Partner for Inveready Asset Management in Madrid, where he leads their Club Deal practice. Mr. Fernández holds a BA in Business Administration from Universidad Autónoma de Madrid, has attended executive development programs from INSEAD and IE Business School and speaks four languages.

***Laurent Teitgen.*** Mr. Teitgen currently serves as a member of the Codere Online Board and its Audit Committe. Mr. Teitgen was the Head of the accounting department at Fiduciaire Jean-Marc Faber S.à r.l. from May 2009 to April 2024. Mr. Teitgen has also served as a member of the board of directors and as a member of the audit committee of the board of NeoGames S.A. from April 2017 to April 2024. Mr. Teitgen currently serves on the board of directors of Neston S.à r.l., Summit Luxco S.à r.l. and Summit Lux Finance S.à r.l. Mr. Teitgen also previously served on the Board of the Company from November 2021 to June 2024. Mr. Teitgen is a resident of Luxembourg and previously held positions with BDO, Intertrust, and TASL (now Orangefield/Vistra). Mr. Teitgen holds a B.A. in Accounting and Financial Management with a specialization in Accounting Review from Université de Lorraine, IUT Henri Poincaré, France.

***Daniel Valdez.*** Mr. Valdez has served as a member of the Codere Online Board since the consummation of the Business Combination in 2021 except between August 2023 and April 2024 during which he was a Board observer. Mr. Valdez served as an independent director of the board of DD3 until the consummation of the Business Combination. He also served as a director and advisor for Betterware since December 2018, when his co-led special purpose vehicle, Promotora Forteza, S.A. de C.V., acquired a minority stake in the business. He is a Managing Partner of Alternative Investments and Portfolio Manager (Public Equities) for MG Capital. Mr. Valdez has also served as an independent member of investment committees for several public and private investment trusts. Prior to joining MG Capital, he held Senior Analyst positions at prominent hedge funds: Sigma Capital Management from 2012 to 2014; Eton Park Capital Management from 2011 to 2012; and Surveyor Capital (Citadel) from 2010 to 2011. Prior to joining Surveyor Capital, Mr. Valdez worked as an Investment Banking Associate for Morgan Stanley in New York from 2008 to 2010. While at Morgan Stanley, he joined the Technology, Media & Telecom group executing several initial equity offerings, mergers and acquisitions, and debt offerings transactions. Mr. Valdez earned an MBA from the Harvard Business School and a Bachelor of Science from Stanford University.

**Code of Ethics**

See Item 16B *"Code of Ethics."*

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**Senior Management**

As of the date of filing of this annual report, the following persons serve as senior officers of Codere Online:

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Title** |
| Aviv Sher<sup>(1)</sup> | 45 | Chief Executive Officer |
| Oscar Iglesias | 50 | Chief Financial Officer |
| Amalia López | 47 | Chief Accounting Officer |
| Alberto Telias | 42 | Chief Marketing Officer |
| Yaiza Rodríguez | 38 | General Counsel |
| Deborah Guivisdalsky | 44 | Chief Operating Officer |
| Matan Shemesh | 44 | Chief of Growth and Strategy |

---

(1) Former Chief Operating Officer Mr. Sher replaced Mr. Edree as the Chief Executive Officer of Codere Online effective March 1, 2023.

***Aviv Sher.*** Mr. Sher serves as the Chief Executive Officer of Codere Online since March 1, 2023. Prior to that, Mr. Sher was Codere Online's Chief Operating Officer since the Company went public in 2021, following his tenure as Codere Group's Digital Division Director of Operations since 2018. Previously, Mr. Sher was General Manager at Primegaming for nine years, where he helped to build the company from 5 to 50 employees and grew its online portfolio from just one to multiple brands. Mr. Sher was a founding team member of NeoGames (Nasdaq: NGMS), where he helped to build all of its divisions from scratch and where he spent 3 years as Chief Operating Officer. Mr. Sher has a BA in Economics and an MBA with financing specialty from Bar Ilan University (Israel).

***Oscar Iglesias.*** Mr. Iglesias serves as the Chief Financial Officer of Codere Online. Mr. Iglesias also served on its Board from December 2021 through June 2023. Prior to that, Mr. Iglesias served since 2015 as Deputy CFO of Codere Group and, since 2017, as Director of Corporate Development. Mr. Iglesias has served as officer and as a member of the board of directors of multiple subsidiaries of the Codere Group and continues to serve as a member of the board of directors of CCJV S.A.P.I. de C.V. and HR Mexico City Project Co. S.A.P.I. de C.V., two subsidiaries of the Codere Group. His previous experience includes CFO and Head of Corporate Development for Franklyn Hotels & Resorts (Barcelona), principal with the private equity group WL Ross & Co. LLC (New York), and roles within the investment banking and equity research departments of Bear, Stearns & Co. Inc. (New York). Mr. Iglesias graduated from the McIntire School of Commerce at the University of Virginia and has an MBA from Columbia Business School. Oscar is a citizen of both the United States and Spain.

***Amalia López.*** Ms López currently serves as Chief Accounting Officer (CAO) at Codere Online, a role she assumed in July 2023 after more than 15 years of diverse experience at Codere Group. Before joining Codere Online, she was the Head of Controlling in the Finance Department at Codere Group, overseeing a comprehensive portfolio of operations across multiple countries. During this time, she played a crucial role in the multiple financial restructuring processes Codere Group carried out, while also leading several productivity initiatives and cost-reduction strategies. Earlier in her career, she was a key collaborator in Codere Group Spain's retail operations before serving in the office of the Chairman. She holds a Bachelor's degree in Law and Business Administration from Comillas Pontifical University in Madrid.

***Alberto Telias***. Mr. Telias serves as the Chief Marketing Officer of Codere Online. Mr. Telias has been with Codere Group since 2018, first as Acquisition Marketing Manager and, since 2020, as digital Chief Marketing Officer. Mr. Telias served as Head of Paid Social for the Stars Group from 2016 working with the brand PokerStars in all of the regions where they had operations and introducing the new brands of the group PokerStars Casino and BetStars to the regulated markets. In 2010, he joined William Hill as an account manager to take responsibility of the media on the new license acquired by the company in Spain and after three years working on positioning the brand in the Spanish market he moved to take responsibility of the new channel of communication of such company, Paid Social, for all of the countries where it operated. In 2008, he earned a Bachelor of Business and Administration with mention in Marketing at Universidad Nacional Andres Bello.

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***Yaiza Rodriguez.*** Ms. Rodriguez serves as the General Counsel of Codere Online, Secretary of its Board of Directors and Audit Committee and member of its Compliance Committee. Ms. Rodríguez has been a member of the corporate legal department of Codere Group since 2016, focusing on M&A, corporate finance and restructuring matters. Her previous experience includes working as an M&A and corporate finance attorney in Herbert Smith Freehills and Cuatrecasas. Ms. Rodríguez has an L.L.B. in English Law and European Legal Studies from the University of Reading, an LL.M. in Business Law from Instituto de Empresa and is admitted to the New York Bar, qualified as a Solicitor in England & Wales and qualified as a Spanish attorney.

***Deborah Guivisdalsky***. Ms. Guivisdalsky currently serves as Chief Operating Officer of Codere Online. Prior to that she served as Head of CRM/VIP. Prior to that she was Codere Group's Malta site manager, where she was responsible for the opening of the offices in Malta and the establishment of the different teams and departments. Ms. Guivisdalsky currently oversees all the day-to-day operations across the different teams such as Fraud, Payments, VIP and CRM. Previously, Ms. Guivisdalsky worked at Ladbrokes as Head of VIP in Gibraltar where she created and managed a team of 60 members. Previously, Ms. Guivisdalsky was Head of Casino at Xwise, where she helped to build the teams and managed employees directly under her responsibility. Ms. Guivisdalsky was also in charge of the operations handling for VIP, CRM and Customer Support as part as her tasks for over seven years.

***Matan Shemesh***. Mr. Shemesh serves as Chief of Growth and Strategy of Codere Online since January 2022. Prior to that, he co-founded two Ad-tech and marketing companies, holding these positions since April 2019 and March 2017, respectively. Before starting his own companies, Matan worked for Ladbrokes Coral, where he served as CEO of Ladbrokes Israel and CFO of Digital Israel. He also worked as an Accounting Manager for CA Technologies and CPA at KPMG. Matan has a demonstrated history of working with online companies and possesses skills in online marketing, digital acquisition, product development, operations management, and customer relationship management. He has a strong financial background as a CPA and a BA in Accounting and Economics from Tel Aviv University. His professional experience includes business development and executive leadership roles as a CEO and CFO.

**Family Relationships**

There are no family relationships between any of our executive officers and our directors.

**B.** **Compensation** 

**Compensation of Directors and Senior Management**

***Director Compensation***

Luxembourg law does not provide for limitations with respect to the aggregate annual compensation paid to the members of Codere Online Board; such compensation should however be consistent with Codere Online's compensation policy.

Gabriel Sáenz de Buruaga, Laurent Teitgen and Borja Fernández (the "Remunerated Directors") receive compensation for serving on the Codere Online Board. None of the other three (3) directors receive compensation from Codere Online for serving on the Codere Online Board and/or the audit committee, other than the reimbursement for reasonable and documented out-of-pockets expenses.

The general meeting of the shareholders of Codere Online is responsible for determining the remuneration of Codere Online directors. In its general meeting held on June 24, 2024, shareholders approved the authorisation of the payment of a maximum amount of up to EUR 500,000 (excluding VAT) per annum by Codere Online as aggregate remuneration to the Directors for the performance of their respective mandates for Codere Online until the 2025 annual general meeting of the shareholders.

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***Executive Compensation***

Decisions with respect to the compensation of certain members of Codere Online's senior management are made by the Codere Online Board.

***Aggregate Compensation of Directors and Senior Management***

For the year ended December 31, 2024, the aggregate base compensation paid by Codere Online to the group of individuals serving as members of the senior management team of Codere Online was approximately €1.5 million. Certain members of this group also serve as Directors of the Codere Online Board but receive no compensation in that capacity. This amount does not include de-minimis benefits including, but not limited to, relocation travel, professional and business expenses and benefits in kind reimbursed or paid by Codere Online. The amount also does not include €1.23 million in variable compensation that was paid for the year ended December 31, 2024, by Codere Online to certain individuals who served as officers of Codere Online during the year ended December 31, 2024.

For the year ended December 31, 2024, the aggregate compensation paid by Codere Online to the Remunerated Directors amounted to approximately €293 thousand. None of the other members of the Codere Online Board (including certain members of the senior management team of Codere Online who served as members of the Codere Online Board during the year ended December 31, 2024) were entitled to compensation from Codere Online for serving on the Codere Online Board and/or the audit committee, other than the reimbursement for reasonable and documented out-of-pockets expenses.

Except as disclosed above, as of the date of this annual report, none of the members of the Codere Online Board or the senior management team of Codere Online have received any other compensation, benefits in kind or pension, retirement or similar benefits from Codere Online for the year ended December 31, 2024.

**Incentive Plan**

On February 2, 2022, the Codere Online Board approved the terms and conditions of a long-term incentive plan (the "LTIP"), which was approved by the Codere Online Shareholders at a meeting held on March 3, 2022. The main objective of the LTIP is to enhance the alignment between senior management and director interests with those of Codere Online and Codere Online Shareholders and to strengthen the retention and motivation of senior management and directors in the long term.

The LTIP is primarily for the benefit of certain existing and future senior managers of Codere Online and the Remunerated Directors and may include certain employees and independent contractors providing services to Codere Online. The beneficiaries are proposed by the Chief Executive Officer of Codere Online and approved by the Codere Online Board from time to time. Upon approval by the Codere Online Board, such beneficiaries received an invitation letter to participate in the LTIP. Beneficiaries were required to accept the terms of a post-contractual non-compete and non-solicitation agreement to benefit from the terms of the LTIP.

Compensation under the LTIP is based on the beneficiary's expected role, responsibilities and contribution to the business of Codere Online, among other things. The LTIP includes compensation in the form of share options, restricted shares, and/or deferred payments payable depending upon the increase in Codere Online's equity value. The share options have an exercise price of $10.00 per Ordinary Share, subject to certain anti-dilution protections, and are exercisable at the option of the beneficiary on a cash or cashless basis (subject to Codere Online's option to net cash settle to avoid the dilutive impact from any such share option exercise) and are not be transferable by the beneficiary at any time. The restricted shares may also be net cash settled by Codere Online to avoid the dilutive impact from the issuance of restricted shares. Share options may be exercised, and restricted shares may be sold, following the later of (i) 90 days from the respective vesting date and (ii) December 31, 2024. The deferred payments will be paid at Codere Online's option in cash or Ordinary Shares, will be calculated based on the operating and financial performance of Codere Online and will be payable after the end of the vesting period of the LTIP, subject to certain exceptions and acceleration events.

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The total number of Ordinary Shares issuable to beneficiaries pursuant to the share options and restricted shares is limited to 5% of the total number of Ordinary Shares issued and outstanding at the time the LTIP was approved by the Codere Online Shareholders. Such limit will be increased by an amount equivalent to 0.2% of the total number of Ordinary Shares issued and outstanding on each December 31 through the end of the vesting period of the LTIP, to provide for additional capacity to grant awards to additional beneficiaries under the LTIP.

The incentives granted to the beneficiaries under the LTIP are subject to a 5-year general vesting period, with 20% vesting per year, subject to certain exceptions and acceleration events, in order to promote the long-term retention of the beneficiaries.

Except in the case of a termination for gross misconduct, fraud or gross negligence, in which case the relevant beneficiary would forfeit all rights to both vested and unvested compensation under the LTIP, beneficiaries that cease to be employed by Codere Online or to provide services to Codere Online, as applicable, will retain all vested compensation up to the date of any such resignation or termination. Awards are subject to recovery by Codere Online under certain events, including as a result of a breach of the post-contractual non-compete or non-solicit or pursuant to applicable laws and regulations. Except as prohibited by applicable laws, the company may extend loans to beneficiaries to pay certain taxes due in connection with compensation under the LTIP.

The LTIP is subject to the Spanish employment law as a significant part of the compensation under the LTIP is being awarded to beneficiaries located in Spain. The components of the LTIP may be subject to special terms and conditions depending on the location of the beneficiary.

The foregoing description of the LTIP does not purport to be complete and is qualified in its entirety by reference to the full text of the LTIP Master Agreement, which has been filed as an exhibit to this annual report.

In 2024, 196,150 restricted shares and 200,783 share options vested under the LTIP. In 2025, Codere Online issued 149,639 shares (46,511 less than the total number of vested restricted shares in 2024 as a result of the exercise of the cash settlement option by certain LTIP participants to cover withholding taxes), therefore increasing to 45,640,814 the number of issued and outstanding Ordinary Shares.

**C.** **Board Practices** 

**Corporate Governance**

Notable features of the corporate governance of Codere Online include:

● Codere Online's independent directors meet as needed in executive sessions without the presence of its executive directors or non-independent directors;

● the audit committee of the Codere Online Board is composed of independent directors (see Item 6.A. "*Directors and Senior Management*" for more information on the composition of the Codere Online Board);

● at least one of Codere Online's directors qualify as an "audit committee financial expert" as defined by the SEC and serves on the audit committee; and

● Codere Online has implemented a range of other corporate governance best practices, including a compliance committee that formally reports to the Codere Online Board, in furtherance of the alignment of Codere Online's interests with those of Codere Online Shareholders.

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**Non-Classified Board of Directors**

In accordance with Codere Online's articles of association, the Codere Online Board is not divided into classes of directors, but the Codere Online Shareholders may decide to appoint directors of two different classes, namely the class A directors and the class B directors.

**Independence of our Board of Directors**

A majority of the Codere Online Board members are independent directors and the Codere Online Board has an independent audit committee and an independent compliance committee. See Item 6.A. "*Directors and Senior Management*" for more information on the composition of the Codere Online Board.

**Foreign Private Issuer Exemption**

As a "foreign private issuer," as defined by the SEC, Codere Online is permitted to follow, and does follow, home country corporate governance practices, instead of certain corporate governance practices required by Nasdaq for U.S. domestic issuers. Codere Online intends to take all actions necessary for it to maintain compliance as a foreign private issuer under the applicable corporate governance requirements of the Sarbanes-Oxley Act of 2002, the rules adopted by the SEC and the Nasdaq corporate governance rules and listing standards.

As indicated above, as a foreign private issuer Codere Online is permitted to comply with Luxembourg corporate governance practices instead of certain corporate governance rules of Nasdaq, provided that Codere Online notifies Nasdaq and discloses which requirements it is not following and the equivalent requirement in Luxembourg. Codere Online relies on the foreign private issuer exemption with respect to certain of Nasdaq's corporate governance standards, including opting to not establish a compensation committee or a nominating and corporate governance committee, which is not required under Luxembourg law. See Item 16G "*Corporate Governance*" for a description of certain Nasdaq corporate governance standards that Codere Online does not follow and a brief description of the home country practice followed in lieu of these corporate governance requirements. In addition, Codere Online may decide to rely upon the "foreign private issuer exemption" for purposes of opting out of some or all of the additional corporate governance rules applicable from time to time to U.S. domestic companies in the future.

Because Codere Online is a foreign private issuer, its directors and senior management are not subject to short-swing profit and insider trading reporting obligations under Section 16 of the Exchange Act. They will, however, be subject to the obligations to report changes in share ownership under Section 13 of the Exchange Act and related SEC rules.

**Controlled Company**

For purposes of the rules of the Nasdaq, Codere Online is a "controlled company." Under the Nasdaq rules, controlled companies are companies of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company. Codere Newco owns approximately 65.7% of the outstanding Ordinary Shares as of March 31, 2025. Accordingly, Codere Online is eligible and may in the future decide to take advantage of exemptions from certain Nasdaq corporate governance standards applicable to controlled companies.

**Chief Executive Officer Agreement**

Codere Online's Chief Executive Officer, Aviv Sher, entered into an employment agreement with Codere Israel Marketing Support Services LTD, effective as of March 1, 2023, including the following main terms and conditions:

- A gross annual fixed salary of ILS 803,000.

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A variable compensation, subject to the achievement of certain objectives, of up to 50% of his gross annual fixed salary.

- A 6 months' notice period for either party to terminate the agreement.

- 12-month non-compete and 24-month non-solicitation obligations.

- A compensation for the non-compete / non-solicitation obligations equivalent to a year's salary (i.e. ILS 803,000). Aviv Sher would have an obligation to return such compensation upon breach of both the non-compete and non-solicitation obligations (plus damages, where applicable).

- Subject to certain conditions, Codere Online's Board has the right to waive the non-compete / non-solicitation obligations which would exempt Codere Online from the obligation to pay Aviv Sher the non-compete compensation.

The above summary is qualified in its entirety to the full text of the CEO Employment Agreement, which is filed as an exhibit to this annual report.

**Audit Committee**

The audit committee of the Codere Online Board consists of Borja Fernández, Laurent Teitgen and Daniel Valdez. Mr. Fernandez serves as the Chairman of the audit committee. All three members of the audit committee meet the requirements for independence and financial literacy under the applicable rules and regulations of the SEC and the corporate governance rules of Nasdaq, in each case applicable to foreign private issuers. Mr. Fernandez and Mr. Valdez are audit committee financial experts as defined by the SEC rules and have the requisite financial experience as defined by the corporate governance rules of Nasdaq. The audit committee charter is accessible through Codere Online's corporate website. The reference to Codere Online's website address in this annual report does not include or incorporate by reference the information on Codere Online's website into this annual report.

Codere Online's audit committee is responsible for, among other things:

● appointing, compensating, retaining, evaluating, terminating and overseeing Codere Online's independent registered public accounting firm;

● discussing with Codere Online's independent registered public accounting firm their independence from management;

● reviewing, with Codere Online's independent registered public accounting firm, the scope and results of their audit;

● approving all audit and permissible non-audit services to be performed by Codere Online's independent registered public accounting firm;

● overseeing the financial reporting process and discussing with management and Codere Online's independent registered public accounting firm the annual financial statements that Codere Online files with the SEC;

● overseeing Codere Online's financial and accounting controls and compliance with legal and regulatory requirements;

● reviewing Codere Online's policies on risk assessment and risk management, including matters related to Codere Online's cybersecurity protection policy and procedures;

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● reviewing related person transactions; and

● establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters.

**Risk Oversight**

The Codere Online Board is responsible for overseeing Codere Online's risk management process. The Codere Online Board focuses on Codere Online's general risk management strategy, the most significant risks facing Codere Online, and oversees the implementation of risk mitigation strategies by management. Codere Online's audit committee is responsible for discussing Codere Online's policies in particular with respect to financial and accounting risk assessment and risk management.

**D.** **Employees** 

As of December 31, 2024, and December 31, 2023, Codere Online had approximately 325 and 297 employees, respectively, including directors, intermediate managers, technicians and administrative personnel based in Spain, Mexico, Colombia, Panama, Argentina and Israel, most of whom are full-time, direct employees of Codere Online. Operations are primarily run by employees at central service centers in Spain and Israel. Codere Online has in the past and may in the future rely on non-employee independent contractors in the ordinary course to carry out its business. None of Codere Online's employees are represented by a labor organization. Only in Spain our employees are subject to statutory collective bargaining arrangements.

**E.** **Share Ownership** 

For information on the beneficial ownership of Ordinary Shares and Codere Online Warrants of directors and officers, see Item 7.A. "*Major Shareholders and Related Party Transactions—Major Shareholders*." For information on the LTIP, see Item 6.B. "*Compensation.*"

**F.** **DISCLOSURE OF A REGISTRANT'S ACTIONS TO RECOVER ERRONEOUSLY AWARDED COMPENSATION** 

None.

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**Item 7. Major Shareholders and Related Party Transactions**

**A.** **Major Shareholders** 

The following table sets forth information regarding the beneficial ownership of Ordinary Shares as of March 31, 2025, except as set forth below, by:

● each person known to beneficially own more than 5% of the issued and outstanding Ordinary Shares and the Ordinary Shares on a fully diluted basis;

● each of the members of the Codere Online Board and the senior management team; and

● all of the members of the Codere Online Board and the senior management team as a group.

The beneficial ownership of Ordinary Shares of Codere Online is based on (i) 45,640,814 Ordinary Shares issued and outstanding as of March 31, 2025 and (ii) 52,075,814 Ordinary Shares on a fully diluted basis (includes 45,640,814 Ordinary Shares issued and outstanding as of March 31, 2025 and 6,435,000 Ordinary Shares that may be issued upon exercise of the Codere Online Warrants).

Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are exercisable or exercisable within sixty (60) days. Codere Online Warrants may be exercised during the period that commenced on December 30, 2021 (i.e., 30 days after the Closing of the Business Combination), and terminating at 5:00 p.m., New York City time on the earlier to occur of: (i) the date that is five (5) years after the Closing Date, (ii) the liquidation of Codere Online, and (iii) the redemption date as provided in Section 6.2 of the Original Warrant Agreement.

Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all of our Ordinary Shares beneficially owned by them.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br>Ordinary Shares<br>Beneficially<br>Owned<sup>(1)</sup>** | **Percentage of<br>Issued and<br> Outstanding<br> Ordinary<br>Shares<sup>(2)</sup>** | **Number of<br>Ordinary Shares<br>Beneficially<br>Owned<sup>(3)</sup>** | **Percentage of<br> Ordinary<br> Shares on a<br> Fully Diluted<br> Basis<sup>(4)</sup>** |
| ***5% Holders:*** |  |  |  |  |
| Codere Newco, S.A.U.<sup>(5)</sup> | 30000000 | 65.7% | 30000000 | 57.6% |
| BAMCO, Inc.<sup>(6)</sup> | 3824160 | 8.4% | 3824160 | 7.3% |
| ***Directors and Senior Managers:*** |  |  |  |  |
| Gabriel Saenz de Buruaga |  | \* |  | \* |
| Moshe Edree | 148430 | \* | 148430 | \* |
| Borja Fernández | 18770 | \* | 18770 | \* |
| Laurent Teitgen |  |  |  |  |
| Daniel Valdez<sup>(7)</sup> | 25000 | \* | 25000 | \* |
| Gonzaga Higuero |  |  |  |  |
| Oscar Iglesias | 103377 | \* | 103377 | \* |
| Aviv Sher | 17892 | \* | 17892 | \* |
| Alberto Telias | 10310 | \* | 10310 | \* |
| Yaiza Rodríguez | 11259 | \* | 11259 | \* |
| Deborah Guivisdalsky | 6827 | \* | 6827 | \* |
| Matan Shemesh | 13734 | \* | 13734 | \* |
| Amalia Lopez | 6559 | \* | 6559 | \* |
| **All Directors and Senior Managers as a Group** | **362158** | **\*** | **362158** | **\*%** |

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\* Less than one percent.

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(1) Excludes Ordinary Shares underlying Codere Online Warrants.

(2) Percentage based on 45,640,814 Ordinary Shares issued and outstanding as of March 31, 2025.

(3) Includes Ordinary Shares underlying Codere Online Warrants.

(4) Percentage based on 52,075,814 Ordinary Shares on a fully diluted basis (which includes 45,640,814 Ordinary Shares issued and outstanding as of March 31, 2025 and 6,435,000 Ordinary Shares that may be issued upon exercise of the Codere Online Warrants).

(5) Consists of 30,000 Ordinary Shares issued to Codere Newco on June 4, 2021 in connection with Codere Online's incorporation and 29,970,000 Ordinary Shares issued to Codere Newco in connection with the Exchange. The address for Codere Newco is Avenida de Bruselas 26, 28108, Alcobendas, Madrid, Spain.

(6) Based on information reported on a Schedule 13G filed on February 14, 2024, BAMCO, Inc. ("BAMCO"), Ronald Baron and Baron Capital Group, Inc. ("BCG") have shared voting and dispositive power over 3,824,160 Ordinary Shares and Baron Capital Management, Inc. ("BCM") does not have shared voting or dispositive power over any Ordinary Shares. The advisory clients of BAMCO and BCM have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Ordinary Shares in their accounts. To the best of BAMCO, Ronald Baron, BCG and BCM's knowledge, no such person has such interest relating to more than 5% of the Ordinary Shares. BAMCO and BCM are subsidiaries of BCG. Ronald Baron owns a controlling interest in BCG. The respective addresses of BAMCO, Ronald Baron, BCG and BCM is 767 Fifth Avenue, 49th floor, New York.

(7) Consists of 25,000 Ordinary Shares held directly by Valhala Limited Partnership. Daniel Valdez is a limited partner of Valhala Limited Partnership, holds 99.9% of Valhala Limited Partnership and exercises voting and dispositive power of the Ordinary Shares held by Valhala Limited Partnership.

**B.** **Related Party Transactions** 

For a description of certain agreements with related parties entered into in connection with the Business Combination, see Item 10.C. "*Material Contracts.*"

**Restructuring and Exchange**

In accordance with the Business Combination Agreement, the Codere Group underwent a corporate restructuring pursuant to which, subject to certain exceptions, the entities and/or businesses of the Codere Group that form the Codere Online Business were transferred to Codere Online prior to the consummation of the Business Combination. This transfer was performed in two steps:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) *Restructuring*. In this first step, except as indicated below, the relevant entities and/or businesses that form the Codere Online Business that were not direct or indirect subsidiaries or businesses of SEJO as of the date of the Business Combination Agreement were transferred to SEJO. In Spain and Italy, CDON and Codere Scommese S.r.l., respectively, were transferred to, and became wholly-owned subsidiaries of, SEJO, which became in turn a subsidiary of Codere Online upon consummation of the Exchange. In accordance with the Business Combination Agreement, as the planned corporate restructuring could not be consummated by October 1, 2021 with respect to Colombia, Panama and the City of Buenos Aires (Argentina), respectively, Restructuring Agreements were entered into on November 15, 2021 (except for the agreement that Codere Online Panama and ALTA entered into on December 1, 2021) between the relevant Codere Group entity holding the online license and a Codere Online entity. Such Restructuring Agreements generally govern the terms and conditions of, among other things, the assignment by the relevant Codere Group entity of assets, contracts, employees and permits, as applicable, necessary for the operation of the online gaming business by the Codere Online entity in Colombia, Panama and the City of Buenos Aires (Argentina), respectively, subject to the required authorizations. See "*—Material Agreements—Restructuring Agreements.*" In addition, in Mexico, Codere Online operates under an "Asociación en Participación" or "AenP" (an unincorporated joint venture) with LIFO (the entity which holds the LIFO License) as *asociante*, and SEJO as *asociado*, pursuant to which SEJO has the right to receive 99.99% of any distributed profits (see "*—AenP Agreement"*).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) *Exchange*. In the second step, SEJO was transferred to Codere Online.

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**Related-Party Assets, Loans and Liabilities**

Codere Online had the following intra-group current financial assets and liabilities as of December 31, 2024, all of which were with entities of the Codere Group and members of the Codere Online Board.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Related party** | **Current financial assets** | **Trade receivables** | **Current borrowings** | **Trade payables<br> and other<br> current liabilities** |
|  | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** |
| Codere Newco S.A.U. | 320 |  | 11 | 1035 |
| Codere Apuestas España S.L. (CAES) |  | 75 |  | 698 |
| Other retail companies |  | 173 | 175 | 956 |
| Other Latam retail companies |  | 38 | 1436 | 424 |
| Codere Colombia, S.A. |  | 654 | 283 | 599 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. | - | 209 | 1460 | 246 |
| **Total** | **320** | **1149** | **3365** | **3958** |

---

Codere Online had the following intra-group current financial liabilities as of December 31, 2023, all of which were with entities of the Codere Group.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related company** | **Current financial assets** | **Trade receivables** | **Current borrowings** | **Trade payables<br> and other<br> current liabilities** |
|  | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** |
| Codere Newco S.A.U. |  | 3859 |  | 4626 |
| Codere Apuestas España S.L. (CAES) |  | 2011 |  | 2221 |
| Other retail companies |  | 935 | 637 | 1272 |
| Other Latam Retail companies |  | 13 | 2618 | 835 |
| Codere Colombia, S.A. |  | 612 | 325 | 425 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. |  | 717 | 1517 | 291 |
| Other |  | - | 8 | - |
| **Total** |  | **8147** | **5105** | **9670** |

---

**Material Agreements**

***Relationship and License Agreement***

SEJO and Codere Newco entered into a relationship and license agreement dated June 21, 2021 (the "Relationship and License Agreement") that became effective as of the Merger Effective Time.

Pursuant to the Relationship and License Agreement, Codere Newco granted to SEJO, subject to certain limitations and exemptions, an exclusive, sublicenseable and non-transferable license and authority to use certain trademarks (including logos and designs) listed in Schedule A to the Relationship and License Agreement (the "Licensed Marks") in connection with the operation of Codere Online's online gaming business in any jurisdiction in which (i) any member of the Codere Online group conducts the online casino gaming and online sports betting business from time to time, (ii) the governing body of Codere Online has expressly decided to expand the online casino gaming and online sports betting business, or (iii) Codere Online has taken actual formal steps towards obtaining the required permits to conduct the online casino gaming and online sports betting business in such jurisdiction (collectively, the "Territory," which, as of the date of the Relationship and License Agreement, included Spain, Italy, Mexico, Brazil, United States of America, Colombia, Panama, Argentina, Malta and Israel). SEJO may sublicense the Licensed Marks to any member of the Codere Online group. In addition to the Licensed Marks, Codere Newco assigned all of its rights, title and interest in and to certain domain names to SEJO.

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Use of the Licensed Marks by SEJO and its sublicensees is subject to certain restrictions aimed at protecting Codere Newco's rights to the Licensed Marks and the Licensed Marks' reputation and goodwill. Use of the Licensed Marks by SEJO and its sublicensees is also subject to Codere Newco's use guidelines, including standards relative to the quality, design, identity, size, position, appearance, marking and color of the Licensed Marks, and the manner, disposition and use of the Licensed Marks and accompanying designations, on any document or other media including, without limitation, any promotional material.

Pursuant to the Relationship and License Agreement, SEJO undertakes to maintain a website for its business including a link to the homepage of Codere Newco (as identified by Codere Newco), which link shall be comparable in prominence to other links included on some homepage.

As consideration for the license granted by Codere Newco to SEJO and its sublicensees, SEJO shall pay to Codere Newco quarterly fees measured as a percentage (the "Applicable Percentage") of all gross amounts wagered of SEJO and each sublicensee, less player wins, player bonuses, promotional bets and applicable gaming taxes ("Net Win"), taking into account applicable transfer pricing requirements at all times. As of the Merger Effective Time, the Applicable Percentage of Net Win was zero. If SEJO and Codere Newco are unable to reach an agreement on the applicable transfer pricing requirements in connection with the Applicable Percentage, the then-applicable Applicable Percentage shall remain in effect until the earlier of (i) SEJO terminates the Relationship and License Agreement or (ii) Codere Newco and SEJO reach an agreement on the Applicable Percentage or fee arrangement and provided, in each case, that SEJO shall thereafter indemnify and hold harmless Codere Newco and its subsidiaries for any tax liabilities incurred by, or imposed on, Codere Newco and its subsidiaries by a court or tax authority as a result of any failure of the Applicable Percentage to reflect the minimum applicable transfer pricing requirements.

In addition, Codere Newco and its direct and indirect subsidiaries shall not (i) engage or invest in, operate, control, fund, assist, participate in the operation, control or funding, or render services or advice to any person (other than Codere Online) that owns or operates, any online casino gaming and online sports betting business; (ii) advise, request, induce, attempt to induce or otherwise divert any customer, supplier, licensee or other business relation of any member of the Codere Online group to curtail, limit or cease doing business with any member of the Codere Online group or in any way interfere with the relationship between any such customer, supplier, joint venture partner, licensee or business relation and any member of the Codere Online group; (iii) directly or indirectly own, acquire, attempt to acquire or solicit the acquisition, or participate in the ownership, acquisition, attempt to acquire or solicitation of the acquisition, of (A) any direct or indirect interests in any online casino gaming and online sports betting business (other than Codere Online) or (B) any interest in any person (other than Codere Online) with direct or indirect interests in any online casino gaming and online sports betting business; (iv) interfere with any of the direct or indirect interests in the online casino gaming and online sports betting business or any other business of any members of the Codere Online group; (v) license, sublicense, sell or otherwise transfer or confer rights with respect to the Licensed Marks and/or other similar or identical marks to any person (other than Codere Online) operating an online casino gaming and online sports betting business; and/or (vi) in any way attempt to do any of the foregoing or assist any other person to do or attempt to do any of the foregoing. Certain permitted activities are exempted from the foregoing restrictions, including any business of regulated gambling and gaming and related services accessible exclusively through physical retail or other offline channels and certain activities that do not exceed a *de minimis* threshold.

However, the Relationship and License Agreement provides that Codere Newco may submit a written authorization request to the board of SEJO (which shall refer the request to the Codere Online Board) regarding any of the foregoing restricted actions or activities that Codere Newco or any of its subsidiaries proposes to take in a jurisdiction that is outside the Territory. Any such actions or activities shall be deemed consented to if SEJO does not inform Codere Newco of a determination within 60 business days following receipt of Codere Newco's request or if, after rejecting Codere Newco's request, SEJO fails to consummate or materially undertake such actions or activities within six (6) months of Codere Online Board's determination.

The Relationship and License Agreement contains representations and warranties of Codere Newco, including in connection with Codere Newco's valid organization; ownership, enforceability, validity and due registration of the Licensed Marks; authority to license the Licensed Marks; non-existence of actions, suits, legal proceedings or formal investigations contesting the validity of the Licensed Marks or Codere Newco's rights under the Licensed Marks; non-violation of other agreements, laws and permits and sufficiency of the Licensed Marks and certain other intellectual property for the operation of the online casino gaming and online sports betting business. The Relationship and License Agreement also contains representations and warranties of SEJO.

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The Relationship and License Agreement contains indemnification provisions subject to specified limitations.

The Relationship and License Agreement shall be in effect for an indefinite term, unless terminated by either party. Either SEJO or Codere Newco may terminate the Relationship and License Agreement if the other party defaults in the performance or observance of a material term and such default continues uncured or unremedied for a period of 90 days after written notice thereof. Either SEJO or Codere Newco may also terminate the Relationship and License Agreement upon the occurrence of a change of control (described as the direct or indirect acquisition of the beneficial ownership of more than 50% of the share capital of Codere Online or SEJO by a non-affiliated third party or by a group of non-affiliated third parties acting in concert) or a sale of substantially all of the assets of Codere Online on a consolidated basis to a non-affiliated third party or by a group of non-affiliated third parties acting in concert, provided that such termination shall be effective on the date which is two (2) years after the date of the written notice. For the avoidance of doubt, neither Codere Online, nor Codere Newco nor one or more of Codere Newco's future or current affiliates, successors, assigns or any entity acquiring all of the assets and/or business of Codere Newco shall be deemed to be non-affiliated parties for the purposes of the application of such change of control clauses. For the further avoidance of doubt, Codere Newco's mere failure to control or own, directly or indirectly, a majority of the share capital of Codere Online or SEJO shall not result in a change of control (unless a non-affiliated third party or a group or non-affiliated third parties acting in concern acquire in one or a series of related transactions or otherwise become the beneficial owner of more than 50% of the share capital of Codere Online or SEJO). SEJO may also terminate the Relationship and License Agreement at any time, upon written notice to Codere Newco, provided that such termination shall be effective on the date which is 90 days after the date of the written notice.

On the effective date of the termination of the Relationship and License Agreement, SEJO shall, among other things, cease, and cause its sublicensees to cease, using the Licensed Marks, including in the company name. If Codere Newco terminates the Relationship and License Agreement upon the occurrence of a change of control or sale of substantially all of the assets, Codere Newco and its subsidiaries shall be subject to certain restrictions in connection with the use of the Licensed Marks in the Territory for a period of five (5) additional years after the effective date of the termination of the Relationship and License Agreement.

The Relationship and License Agreement is governed by Spanish law.

Effective as of May 1, 2025, the Company, SEJO and Codere Newco entered into a waiver agreement pursuant to which the Company and SEJO agreed to waive the prohibition included in the Relationship and License Agreement restricting Codere Newco from carrying out a Restricted Activity (including, for the avoidance of doubt, the license, sublicense, sale or transfer/granting of rights with respect to the Licensed Marks to any person (other than Codere Online) operating an online gaming business) within the Territory, exclusively with respect to Italy (the "Waiver"). The Waiver will continue to be in effect provided that Codere Newco, or any company within Codere Group (i) starts operating an online gaming business pursuant to an Italian online gaming license held by a vehicle directly or indirectly controlled by Codere Newco (the "Italian Online Operation") within one year from May 1, 2025, and (ii) continues operating the Italian Online Operation, without interruption, pursuant to an Italian online gaming license. Codere Newco shall indemnify and hold harmless SEJO, the Company, its successors and assigns and any Codere Online subsidiary and any of their respective directors, officers, agents, members, partners, stockholders and employees and other representatives of any Codere Online company (each, a "Codere Online Indemnified Party"), on demand, and on an after-tax basis without any withholding or deduction, from and against any claims, liabilities, losses, damages, costs or expenses (including reasonable legal expenses and attorney's fees) ("Loss") incurred by any Codere Online Indemnified Party arising from or in connection with the Waiver, including but not limited to (i) any fine, sanction, penalty or fee imposed by and payable to any regulatory authority, in any jurisdiction, and or (ii) any claims brought by any third party, arising from or in connection with (a) the Waiver, and/or (b) the use of the Licensed Marks by Codere Newco and/or its affiliates with respect to an online gaming business in Italy, and/or (c) the operation by Codere Newco and/or its affiliates of the online gaming business in Italy; provided that no Codere Online Indemnified Party shall be so indemnified with respect to any Loss that is finally determined by a final and non-appealable judgment entered by a court of competent jurisdiction, or pursuant to a settlement agreement agreed to by such Codere Online Indemnified Party, to have resulted from such Codere Online Indemnified Party's bad faith, fraud, willful misconduct or gross negligence or, in the case of a criminal matter, conduct undertaken with knowledge that the conduct was unlawful.

The foregoing description of the Relationship and License Agreement and the Waiver does not purport to be complete and is qualified in its entirety by reference to the full text of the Relationship and License Agreement and the Waiver, which have been filed as an exhibit to this annual report.

***Sponsorship and Services Agreement***

SEJO and Codere Newco entered into a sponsorship and services agreement dated June 21, 2021 (the "Sponsorship and Services Agreement") that became effective as of the Merger Effective Time, as amended from time to time.

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Pursuant to the Sponsorship and Services Agreement, Codere Newco granted to SEJO, subject to certain limitations and exemptions (including Codere Newco's right to engage in any permitted activity under the Relationship and License Agreement), an exclusive and non-transferable license and authority to use any and all marks, names, images, designations, anthems, photographs and brands set forth in, or incorporated in the future into, the RM Sponsorship Agreement, within the Territory (subject to any further geographic limitations set forth in the RM Sponsorship Agreement) in connection with the operation of Codere Online's online business. On October 7, 2021, the RM Sponsorship Agreement was amended to, among other things: (i) extend the term of the RM Sponsorship Agreement for four (4) additional football seasons, until June 30, 2026, with either party having a right to terminate the agreement at the end of the 2022-2023 football season; (ii) amend the applicable territory to only include Mexico, South America, Central America, Puerto Rico and Dominican Republic; (iii) amend certain marketing terms; (iv) amend the economic terms, and (v) provide that Codere Newco shall continue to have a right to terminate the RM Sponsorship Agreement if any legislation is passed in the Territory which restricts marketing and advertising of online gaming and which would impact any or all marketing or advertising rights granted to Codere Newco under the RM Sponsorship Agreement. SEJO and Codere Newco also agreed to negotiate in good faith and agree on the terms and conditions of a license and authority to use any and all of Codere Newco's other rights that are licensable under the RM Sponsorship Agreement, from time to time, by Codere Newco to SEJO within the Territory. SEJO and Codere Newco also agreed to negotiate in good faith and agree on the terms and conditions of the assignment or license of any new sponsorship rights under any sponsorship agreements entered into by Codere Newco and certain of its affiliates and subsidiaries from time to time after the Merger Effective Time (together with the foregoing rights licensed under the RM Sponsorship Agreement, the "Sponsorship Rights"). SEJO may sublicense the Sponsorship Rights to any member of the Codere Online group. Two of such new sponsorships rights have been sublicensed since the Merger Effective Time for: (i) The 2022 Formula 1 Mexico City Grand Prix, held on October 28 to 30<sup>th</sup>, 2022, entered into between SEJO and Newco on October 27, 2022; and (ii) effective as of May 3, 2023, the exclusive right to benefit from the sponsorship rights under the River Plate sponsorship agreement entered into between Iberargen, S.A. (a Codere Newco subsidiary) and Club Atlético River Plate, A.C. signed on July 2, 2021 and with termination date on July 31, 2025.

Use of the Sponsorship Rights by SEJO and its sublicensees is subject to certain restrictions (including any further restrictions set forth in the relevant sponsorship agreement) aimed at protecting Codere Newco's rights to the Sponsorship Rights and the Sponsorship Rights' reputation and goodwill.

Codere Newco and SEJO shall negotiate and agree in good faith on the fees payable by SEJO to Codere Newco as consideration for the license, assignment or right to use of the Sponsorship Rights from time to time, provided that Codere Newco has the right to suspend SEJO's and any sublicensee's use of the Sponsorship Rights until such time as Codere Newco and SEJO agree on the applicable fees.

In addition, since the Merger Effective Time, Codere Newco provides, or arranges for services providers (including Codere Newco affiliates and any other third-parties) to provide, certain services to Codere Online to assist Codere Online in operating the online casino gaming and online sports betting business in a manner that is consistent with the operation of the online casino gaming and online sports betting business prior to the Merger Effective Time. The services include certain internal audit, communication, legal, financial management, human capital, corporate security support, platform services and corporate development services, office space and such other services of the type and nature appropriate for a publicly listed entity in connection with the online casino gaming and online sports betting business, which Codere Online may reasonably request from time to time (collectively, the "Services"). The Sponsorship and Services Agreement contains covenants of Codere Newco in connection with the standard and quality of the Services.

Subject to certain terms and conditions, SEJO is entitled to request an amendment of the scope of the Services, including by discontinuing certain Services, reducing the number of Services recipients or the nature or description of the Services or otherwise, provided, however, that, SEJO may not increase the scope of the Services without Codere Newco's prior written consent; and provided further, however, that prior to such modification, SEJO and Codere Newco shall agree in writing to any modification of the Services fees resulting from such change in scope, and ii) only since January 1, 2024, that the terms and conditions of such discontinuation must be agreed by both parties. Discontinuation of any Services by SEJO is subject to payment to Codere Newco of any costs incurred by Codere Newco directly linked to the discontinuation of any Services, including but not limited to severance payments, third party break-up fees and third party fees related to the Services being discontinued ("Discontinuation Costs").

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As consideration for the provision of the Services, for the period from the Merger Effective Time until December 31, 2022 (the "Reset Date"), SEJO agreed to pay to Codere Newco on a quarterly basis a cash amount in euro equal to 0.75% of all gross amounts wagered of SEJO together with its subsidiaries, less player wins, player bonuses, and promotional bets. Following the Reset Date, the Sponsorship and Services Agreement states that Codere Newco and SEJO shall negotiate and agree in good faith on the fee payable by SEJO for the next-succeeding calendar year as consideration for the provision of the Services during such calendar year. In the event that Codere Newco and SEJO are unable to agree on the applicable fees by the time of the Reset Date or an anniversary thereof, the then-applicable fees shall remain in effect and either Codere Newco or SEJO may terminate the Sponsorship and Services Agreement by providing written notice to the other party within three (3) months of such Reset Date (or anniversary thereof, as applicable), provided that such termination shall not be effective earlier than the date that is three (3) months after such written notice is provided by the terminating party to the other party.

The Sponsorship and Services Agreement contains representations and warranties of Codere Newco, including in connection with Codere Newco's valid organization; enforceability and validity of the RM Sponsorship Agreement; authority to license the rights under the RM Sponsorship Agreement; non-violation of third-party rights, other agreements, laws and permits; non-existence of actions, suits, legal proceedings or formal investigations contesting the right of Codere Newco to license its rights under the RM Sponsorship Agreement or contesting the provision of the Services; sufficiency of resources, permits and title to intellectual property to perform its obligations and sufficiency of the Services identified in the Sponsorship and Services Agreement to substantially conduct the online gaming business in the ordinary course. The Sponsorship and Services Agreement also contains representations and warranties of SEJO.

The Sponsorship and Services Agreement contains indemnification provisions subject to specified limitations. Codere Newco's aggregate liability in any fiscal year in connection with the Sponsorship Rights is capped at the aggregate amount of the fees received for the Sponsorship Rights in effect for the prior two (2) fiscal years. Codere Newco's aggregate liability in any fiscal year in connection with the provision of the Services is capped at the aggregate amount of the fees received for the provision of the Services in effect for the prior two (2) fiscal years.

The initial term of the Sponsorship and Services Agreement is five (5) years from the Merger Effective Time, subject to one (1)-year automatic extensions unless terminated by either party by providing 90 days' written notice prior to the expiration of the initial term or such extended term. Either SEJO or Codere Newco may terminate the Sponsorship and Services Agreement if the other party defaults in the performance or observance of a material term and such default continues uncured or unremedied for a period of 90 days after written notice thereof. Either SEJO or Codere Newco may also terminate the Sponsorship and Services Agreement upon the occurrence of a change of control (described as the direct or indirect acquisition of the beneficial ownership of more than 50% of the share capital of Codere Online or SEJO by a non-affiliated third party or by a group of non-affiliated third parties acting in concert) or a sale of substantially all of the assets of Codere Online on a consolidated basis to a non-affiliated third party or by a group of non-affiliated third parties acting in concert, provided that such termination shall be effective on the date which is one (1) year after the date of the written notice. For the avoidance of doubt, neither Codere Online, nor Codere Newco nor one or more of Codere Newco's future or current affiliates, successors, assigns or any entity acquiring all of the assets and/or business of Codere Newco shall be deemed to be non-affiliated parties for the purposes of the application of such change of control clauses. For the further avoidance of doubt, Codere Newco's mere failure to control or own, directly or indirectly, a majority of the share capital of Codere Online or SEJO shall not result in a change of control (unless a non-affiliated third party or a group or non-affiliated third parties acting in concern acquire in one or a series of related transactions or otherwise become the beneficial owner of more than 50% of the share capital of Codere Online or SEJO). Either SEJO or Codere Newco may also terminate the Sponsorship and Services Agreement in the event that Codere Newco and SEJO are unable to agree on the applicable fees by the time of the Reset Date or an anniversary thereof, as described above. SEJO may also terminate the Relationship and License Agreement at any time, upon written notice to Codere Newco, which termination shall be effective on the date which is 90 days after the date of the written notice and shall be subject to the payment of any Discontinuation Costs to Codere Newco.

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On the effective date of the termination of the Sponsorship and Services Agreement, Codere Newco shall cease the provision of any Services and SEJO shall cease, and cause its sublicensees to cease, using the Sponsorship Rights, among other things. If Codere Newco terminates the Sponsorship and Services Agreement upon the occurrence of a change of control or sale of substantially all of the assets of Codere Online on a consolidated basis, Codere Newco shall use commercially reasonable efforts to negotiate with each of the counterparties to the then-current sponsorship agreements to allow for the continued license or assignment of the Sponsorship Rights to Codere Online, until the later of (i) two (2) years after the date of the written termination notice submitted by Codere Newco or (ii) the expiration of the initial term of the relevant sponsorship agreement.

The Sponsorship and Services Agreement is governed by Spanish law.

The foregoing description of the Sponsorship and Services Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Sponsorship and Services Agreement, which has been filed as an exhibit to this annual report.

***Platform and Technology Services Agreement***

Codere Newco, Codere Apuestas España S.L.U. and OMSE entered into a platform and technology services agreement effective January 1, 2021 (the "Original Platform and Technology Services Agreement"), for the provision of platform and technology services by Codere Newco and Codere Apuestas España S.L.U. (collectively, the "Providers") to OMSE's online casino and online sports betting business.

The services under the Original Platform and Technology Services Agreement included personnel, customer support, internal trading personnel, technical assistance and technology, IT operations, security and cybersecurity, systems, communications, equipment, software licenses, trading and other services or development projects that may be requested by Codere Online (collectively, the "Platform Services"). The parties agreed on an annual basis the type, nature, timetable, specifications, parameters or terms and conditions of services to be provided by the Providers in the next-succeeding calendar year, provided that OMSE may, at any time, amend the scope of the Platform Services, including by discontinuing the provision of certain Platform Services, by providing prior notice to the Providers. The Platform Services were provided by the Providers on an exclusive basis, subject to certain limitations and exemptions.

As consideration for the Platform Services, OMSE agreed to pay to the Providers monthly fees equal to the costs of the Platform Services, plus a markup (5.02% as of January 1, 2021), if applicable, pursuant to transfer pricing requirements. The applicable fees have been agreed by OMSE and the Providers. OMSE and the Providers agreed to create a steering and budget committee, comprised of representatives from the parties, to negotiate and agree on the annual fees, monitor major projects and infrastructure services, conduct risk assessments and take other decisions in connection with the Platform Services.

The parties acknowledge that the Providers own and are duly licensed to use the existing software and hardware infrastructure constituting the main interface between customers that participate in the online gaming activities and the online casino gaming and online sports betting operators (the "Platform"). The Providers agree to develop and/or perform certain works to the Platform and any embedded software (including certain modifications, enhancements, adaptations, translations or other changes) as required by OMSE, its end users or other third parties. Such works shall be developed and made on a "work for hire" basis.

The Original Platform and Technology Services Agreement contained representations and warranties of the Providers and OMSE, including in connection with the parties' authority to enter into the agreement; non-violation of other agreements, laws and permits; absence of required authorizations, consents or approvals and validity and legality of the agreement. The Original Platform and Technology Services Agreement also contained representations and warranties of the Providers in connection with the provision of the Platform Services.

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The Original Platform and Technology Services Agreement contained indemnification provisions subject to specified limitations. The Providers' aggregate liability in connection with the Original Platform and Technology Services Agreement is capped at the aggregate amount of fees paid by OMSE to the Providers in the preceding nine (9) months.

Finally, in connection with the provision of the Platform Services, the Providers and OMSE entered into a services and service level agreement (the "SLA") that became effective on January 31, 2021. The SLA sets forth certain service levels, including the terms and conditions for (i) the provision of the Platform Services, (ii) correcting any defects reported by OMSE and (iii) adjusting current and future fees based on certain events.

The Original Platform and Technology Services Agreement is governed by Spanish law.

Effective as of December 31, 2022, the parties terminated the Original Platform and Technology Services Agreement and the Providers, SEJO and CDON entered into a new agreement, which contained substantially the same terms as the Original Platform and Technology Services Agreement (the "New Platform and Technology Services Agreement"), effective as of January 1, 2023. The material terms of the New Platform and Technology Services Agreement are consistent with those of the Original Platform and Technology Services Agreement, except that:

● Provider shall provide the services to CDON within the Spanish territory and to SEJO within the Latam territories (as defined therein) including, but not limited to, Mexico, Colombia, Panama and Ciudad de Buenos Aires and Mendoza Province (Argentina).

● The parties agree on a new updated estimated annual budget for 2024 and the respective caps over the budgeted amounts that shall operate over each of the services.

● A Disputes Resolution Committee is established to discuss and resolve any alleged breach of warranties or undertakings under the New Platform and Technology Agreement.

● The New Platform and Technology Services Agreement has an initial term from January 1, 2023 until May 17, 2029, automatically renewable for 12-month periods unless either Party provides 90 day's written notice.

● The New Platform and Technology Services Agreement may be terminated by Codere Online, at any time and for any reason, with 6 month's written notice to the Providers, which may only be sent after January 1, 2026.

The foregoing description of the New Platform and Technology Services Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the New Platform and Technology Services Agreement, as amended, which has been filed as an exhibit to this annual report.

***AenP Agreement***

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In the event that operational needs of the AenP require it, SEJO shall make the necessary additional contributions to finance the expenses related to the Business in accordance with the Business' annual budget. Third parties are allowed to join the AenP and to make contributions in favor of the AenP only if SEJO provides its prior written consent. Pursuant to the AenP Agreement, LIFO irrevocably agrees to maintain in force and operate the LIFO License and to comply with the terms and conditions imposed by them, at all times, as well as to request the LIFO License's renewal in accordance with its terms.

Net profits or losses resulting from the operation of the Business shall be distributed in the following proportion: LIFO shall be entitled to receive 0.01% and SEJO shall be entitled to receive 99.99%. Additionally, the parties agree that losses corresponding to SEJO must not exceed the value of its contributions.

The AenP Agreement includes certain mutual indemnities among the parties and their respective affiliates and is subject to Mexican law, including an indemnity granted by LIFO to SEJO and its affiliates for any losses incurred by SEJO and/or its affiliates in the event that any LIFO or Codere Group creditors (including any regulatory authority) initiate legal proceedings to access or seize any assets deposited in the LIFO AenP account(s), notwithstanding that such indemnity is limited to the loss actually suffered by SEJO and/or its affiliates. In the event that, for any reason, a procedure for cancellation or revocation of the LIFO License is initiated, LIFO shall make its best efforts to have another Mexican entity within the Codere Group grant SEJO the right to operate under a permit in accordance with the terms of the AenP but pursuant to the terms of such permit.

Once effective, the AenP Agreement is expected to remain in force during the term of the LIFO License, including its renewals from time to time. SEJO shall be entitled to terminate the AenP Agreement with 15 days prior written notice. LIFO shall not be entitled to terminate the AenP Agreement without the prior written consent of SEJO. In the event that the AenP Agreement is terminated, the AenP shall be dissolved and liquidated in accordance with the terms of the AenP Agreement.

In August 2023, LIFO granted broad powers of attorney to certain members of Codere Online's management and the parties amended the AenP Agreement (effective as of August 2, 2023) to include the following indemnities granted by SEJO to LIFO:

● For any losses suffered by LIFO as a result of contracts authorized in writing by an employee or authorized representative of SEJO, in accordance with SEJO's internal protocols, which LIFO signs in the future or has signed in the past with third parties, and which have, as their purpose, the operation and management of the online business, as defined in the AenP Agreement, regardless of who has signed the contract.

● For any losses (including any sanctions from the regulator or other competent administrations) suffered by LIFO i) for actions LIFO has taken following SEJO's instructions, or; ii) for omission of any formalities or duties that should be complied with in connection with the online business, including the potential loss of any license to operate the online business, save for those obligations for which LIFO is responsible under the AenP Agreement or under applicable law.

● To indemnify the directors and officers of LIFO, for omissions of formalities or duties that are required to be performed in connection with the online business, except for those for which LIFO is responsible under the AenP Agreement or under applicable law, and, in both cases, excluding from such indemnity those acts or omissions committed with intent or fraud. In addition, SEJO undertakes to use its best efforts to obtain insurance or amend its current insurance policy so that the directors and officers of LIFO are covered against any litigation, claim or liability in which they may be involved in connection with the online business (except in cases of wilful misconduct or fraud).

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Additionally, SEJO shall bear the costs and pay any reasonable expenses for any legal proceeding, whether administrative, judicial, tax or extrajudicial, brought or commenced against LIFO by any third party (including, without limitation, any individuals or legal entities or any administrative or governmental authority, whether Mexican or foreign) with respect to any of the aforementioned indemnities granted by SEJO.

The indemnification obligations described herein shall survive the termination of the AenP Agreement for the longest period permitted by applicable law.

The foregoing description of the AenP Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the AenP Agreement and applicable amendments, which have been filed as exhibits to this annual report.

***Internal Affiliate Program Master Agreement***

SEJO and Codere Newco entered into an internal affiliate program master agreement effective January 1, 2021 (the "Internal Affiliate Program Master Agreement") establishing certain revenue sharing principles between the retail and the online businesses in Spain, Italy, Mexico, Argentina, Panama and Colombia (the "Omni-Channel Jurisdictions").

Pursuant to the Internal Affiliate Program Master Agreement, SEJO and Codere Newco agreed to cause certain of their respective subsidiaries to apply and adhere to certain corporate revenue sharing principles. In each Omni-Channel Jurisdiction, a subsidiary operating in the online channel which registers the online wagering activity of a customer that is active in both the retail and online channels, but used to be a retail-only customer (the "Retail Omni-Channel Customer"), shall pay to the retail subsidiary that operates the retail venue in which such customer was active at the time of becoming a Retail Omni-Channel Customer, 35% of the Net Win of such customer generated in any online platform operated by SEJO or its affiliates and subsidiaries from the time such customer becomes a Retail Omni-Channel Customer and until 18 months thereafter (the "Retail Participation"). Similarly, in each Omni-Channel Jurisdiction, a subsidiary operating in the retail channel which registers the retail wagering activity of a customer that is active in both the retail and online channels, but used to be an online-only customer (the "Online Omni-Channel Customer"), shall pay the online subsidiary in which said customer was active at the time of becoming an Online Omni-Channel Customer, 35% of the Net Win of such customer from the time it becomes an Online Omni-Channel Customer and until 18 months thereafter (the "Online Participation"). Additionally, the Internal Affiliate Program Master Agreement includes exceptions to the revenue sharing principles in the event the retail license and the online license are held by the same entity in an Omni-Channel Jurisdiction or in the event there is a contractual arrangement between an online and a retail subsidiary for the provision of certain operating services. Further, the Internal Affiliate Program Master Agreement sets forth a deposit fee payable by the online subsidiaries for deposits made by online customers in retail venues.

After 18 months from the time a customer becomes a Retail Omni-Channel Customer or an Online Omni-Channel Customer, as the case may, no subsidiary shall be entitled to any Retail Participation or Online Participation, as applicable, in regards to any customer upon which either a Retail Participation or Online Participation had previously applied.

The initial term of the Internal Affiliate Program Master Agreement was one (1) year from January 1, 2021, subject to one (1)-year automatic extensions unless terminated by either party by providing 30 days' written notice prior to the expiration of the initial term or such extended term. Either SEJO or Codere Newco may terminate the Internal Affiliate Program Master Agreement in the event of a material breach by the other party and if such breach continues uncured or unremedied for a period of 15 days after written notice thereof. Either SEJO or Codere Newco may also terminate the Internal Affiliate Program Master Agreement at any time subject to 30 days' prior notice.

The Internal Affiliate Program Master Agreement is governed by Spanish law.

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Effective on June 30, 2023, the parties entered into an amendment to the Internal Affiliate Program Master Agreement amending the in-store processing fee and including a new balance transfer fee in Spain, the eligibility conditions of certain customers under the agreement and to agree on a catch-up payment of approximately €180,000 from SEJO to Codere Newco, payable in six equal monthly instalments, pursuant to the retroactive application of said eligibility conditions.

The foregoing description of the Internal Affiliate Program Master Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Internal Affiliate Program Master Agreement and applicable amendments, which have been filed as exhibits to this annual report.

***Restructuring Agreements***

*Argentina Restructuring Agreement*

On November 15, 2021, Iberargen, S.A. a subsidiary of the Codere Group, and SEJO, a subsidiary of Codere Online, entered into an agreement (as amended from time to time, the "Argentina Restructuring Agreement") pursuant to which: (i) the parties agreed to jointly incorporate a new company in Argentina, Codere Online Argentina, S.A., with Iberargen, S.A. and SEJO initially retaining 5% and 95% stakes, respectively; Iberargen, S.A. agreed to assign any economic rights related to its 5% stake to SEJO and to seek to transfer such stake to SEJO, provided such transfer is legally allowed and does not affect Codere Online Argentina, S.A.'s operations or the Buenos Aires License; (ii) Iberargen, S.A. undertook to take any required action to facilitate the approval, by LOTBA, of the transfer of the Buenos Aires License to Codere Online Argentina, S.A.; (iii) Iberargen, S.A. undertook to, upon LOTBA's approval of such transfer (or, if applicable, the granting of a new license to Codere Online Argentina, S.A. by LOTBA) (the "Condition Precedent"), assign to Codere Online Argentina, S.A. the Buenos Aires License (if applicable) as well as any assets, contracts and employees necessary for the operation of the Argentine online gaming business by Codere Online Argentina, S.A.; (iv) Iberargen, S.A. agreed to, if LOTBA authorized it to operate in the City of Buenos Aires before the Condition Precedent is satisfied (as is currently the case), exploit the Buenos Aires License pursuant to the instructions of SEJO (and, since its incorporation, Codere Online Argentina, S.A.), with any resulting expenses and income being assigned to the latter; and (v) if LOTBA denies the transfer of the Buenos Aires License, and there is no reasonable likelihood that it will grant a new license to Codere Online Argentina, S.A. during the term of the Buenos Aires License, Iberargen, S.A. and Codere Online Argentina, S.A. shall enter into a Temporary Union Contract (*contrato de union transitoria*) and exploit the Buenos Aires License thereunder, with Codere Online Argentina, S.A. effectively retaining 99.00% of any distributed profits and generally managing the online gaming business.

The aforementioned agreement was amended on November 30, 2021. See "—*Restructuring Agreements Amendments*" below.

On March 28, 2022, SEJO, Iberargen, S.A. and Codere Argentina, S.A., a wholly owned subsidiary of Iberargen, S.A. ("Codere Argentina"), further amended the Argentina Restructuring Agreement to provide additional flexibility to support the incorporation and registration of Codere Online Argentina, S.A. in Argentina. As a result of the amendment, Iberargen, S.A. assigned certain of its undertakings to Codere Argentina. In particular, the parties agreed that Codere Online Argentina, S.A. would be jointly incorporated by Codere Argentina and SEJO, with Codere Argentina and SEJO initially retaining 5% and 95% stakes, respectively; and Codere Argentina agreed to assign any economic rights related to its 5% stake to SEJO and to seek to transfer such stake to SEJO, provided such transfer is legally allowed and does not affect Codere Online Argentina, S.A.'s operations or the Buenos Aires License. On July 18, 2022, the Public Registry of Commerce of the City of Buenos Aires formalized the registration of Codere Online Argentina, S.A.

Pursuant to the Argentina Restructuring Agreement, the Codere Group agreed to transfer the Buenos Aires License granted to Iberargen S.A. to Codere Online subject to LOTBA authorizing such transfer. Pending obtention of said authorization, Iberargen, S.A. agreed to operate such license in the name and on behalf of Codere Online Argentina, S.A. On May 3, 2023, LOTBA authorised the transfer of the license to Codere Online Argentina, S.A. Upon granting such authorization, Iberargen S.A. assigned certain contracts and resources to Codere Online Argentina S.A. for the operation of the online business.

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*Colombia Restructuring Agreements*

On November 15, 2021, Codere Colombia, S.A., a subsidiary of the Codere Group, and Codere Online Colombia S.A.S., a subsidiary of Codere Online, entered into the following agreements:

● A sale and transfer agreement (as amended from time to time, the "Sale and Transfer Agreement") that governed the terms and conditions of the assignment, from Codere Colombia, S.A. to Codere Online Colombia S.A.S., of all the assets, contracts and employees necessary for the operation of the Colombian online gaming business by Codere Online Colombia S.A.S, including the Colombia License.

● A joint accounts agreement (*contrato de cuentas en participacion*) (as amended from time to time, the "Joint Accounts Agreement") pursuant to which, pending the effective transfer of the Colombia License to Codere Online Colombia S.A.S. (or, if applicable, the granting of a new license to Codere Online Colombia S.A.S.), the parties agreed to jointly exploit the Colombia License, with Codere Online Colombia S.A.S. effectively retaining 99.00% of any distributed profits and generally managing the online gaming business. The agreement was automatically terminated as a result of the transfer of the Colombia License to Codere Online Colombia S.A.S., as further described below.

● A license assignment agreement (as amended from time to time, the "License Assignment Agreement" and, together with the Sale and Transfer Agreement and the Joint Accounts Agreement, the "Colombia Restructuring Agreements") pursuant to which Codere Colombia, S.A. agreed to assign the Colombia License to Codere Online Colombia S.A.S., subject to the approval of Coljuegos.

The aforementioned agreements were amended on November 30, 2021. See "—*Restructuring Agreements Amendments*" below.

On December 21, 2021, the transfer of the Colombia License to Codere Online Colombia S.A.S. was formally requested pursuant to Agreement 08/2020 and Resolutions No. 20161200025334, 20164000029574 of 2016 and 20201000008294 of 2020. The transfer request was approved by Coljuegos on July 1, 2022 and Codere Online Colombia S.A.S. began operating the online business in Colombia under the Colombia License on September 1, 2022. Following such transfer, the Joint Accounts Agreement was automatically terminated. On September 2, 2022, an application for the renewal of the Colombia License was submitted to Coljuegos. On November 10, 2022, Coljuegos renewed the Colombia License until November 14, 2025 pursuant to contract C1901.

*Panama Restructuring Agreements*

On November 15, 2021, HIPA, ALTA, and Codere Online Panama, entered into an agreement (as amended from time to time the "HIPA Restructuring Agreement"), pursuant to which: (i) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain employment agreements with certain HIPA employees; (ii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain sponsorship, licensing, marketing and other services agreements; (iii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right and title to certain assets in connection with HIPA's online gaming operations; and until the transfer of the ALTA License to Codere Online Panama is effective, Codere Online Panama agreed to provide certain operational and advisory services to HIPA in exchange for monthly payments from HIPA amounting to 99% of HIPA's net income from gaming operations. The HIPA Restructuring Agreement was amended on November 30, 2021. See "—*Restructuring Agreements Amendments*" below.

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In addition, on December 1, 2021, upon the commencement of the term of the ALTA License, Codere Online Panama and ALTA entered into an agreement (as amended from time to time the "ALTA Restructuring Agreement" and the HIPA Restructuring Agreement, as partially terminated and superseded by the ALTA Restructuring Agreement, the "Panama Restructuring Agreements") whereby Codere Online Panama agreed to provide certain operational and advisory services to ALTA in exchange for periodic payments on similar terms to the HIPA Restructuring Agreement, terminating and superseding the HIPA Restructuring Agreement with respect to the services being provided by Codere Online Panama to HIPA. The agreement between Codere Online Panama and ALTA shall terminate, among other things, if Codere Online Panama requests the transfer of the ALTA License to Codere Online Panama and such transfer is authorized by the Panama Gambling Control Board.

*Restructuring Agreement Amendments*

On November 30, 2021, the relevant entities of the Codere Group and the Codere Online group entered into amendments to the Restructuring Agreements (except for the agreement that Codere Online Panama and ALTA entered into on December 1, 2021) which provided that any contractual indemnity obligation that the Codere Group entities may have under such agreements shall not be deemed to be duplicative with those included in the Indemnification Letter and that any losses covered by any such contractual indemnity obligation will count towards the $10,000,000 limit set forth in the Indemnification Letter.

*Argentina Debt Agreements*

Effective July 31, 2023, Codere Group and Codere Online entered into agreements to partially offset debts between SEJO, Iberargen, S.A., and Codere Online Argentina, S.A. This included approximately USD 8.7 million owed by Iberargen, S.A. to SEJO (USD 7.5 million in principal and USD 1.15 million in accrued interest) and the equivalent of USD 5.3 million owed by Codere Online Argentina, S.A. to Iberargen, S.A., while also establishing repayment terms for the remaining balance due to Codere Online.

These debts arose from Iberargen, S.A.'s role in managing online gaming operations in Ciudad de Buenos Aires on behalf of Codere Online Argentina, S.A. resulting in Iberargen, S.A. covering operating expenses (in Argentine pesos) with the expectation of future reimbursement from Codere Online Argentina, S.A. To guarantee said reimbursement obligation, Codere Online provided advances in U.S. dollars to Iberargen, S.A. at the official exchange rate under a credit line agreement with SEJO, leading to an overcollateralization of amounts due by Codere Online Argentina, S.A. to Iberargen, S.A.

The resulting obligations between Iberargen, S.A., Codere Online Argentina, S.A., and SEJO formed the basis for the debt restructuring agreements.

*Framework Agreement*

On July 30, 2024, Codere Newco and Codere Online Luxembourg S.A. signed a framework agreement governing their relationship, ensuring compliance with corporate governance practices, managing conflicts of interest, regulating information flows, and overseeing related party transactions. It sets procedures for approving transactions between the two parties, requiring board approvals and ensuring all dealings occur on an arm's length basis. Both parties agree not to actively solicit each other's employees, and any hiring between the two must be approved in advance. The agreement remains in effect as long as Codere Newco controls Codere Online and the latter remains publicly listed.

**C.** **Interests of Experts and Counsel** 

Not applicable.

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**Item 8. Financial Information**

**A.** **Consolidated Statements and Other Financial Information** 

See Item 18 "Financial Statements", which contains the Annual Financial Statements.

**Legal Proceedings**

From time to time, Codere Online may be involved in various legal proceedings and subject to claims that arise in the ordinary course of business or otherwise. For further information, see item 4.B. "*Business Overview—Legal Proceedings*."

**Dividend Policy**

From the annual net profits of Codere Online, at least 5% shall each year be allocated to the reserve required by applicable laws (the "Legal Reserve").

That allocation to the Legal Reserve will cease to be required as soon and as long as the Legal Reserve amounts to 10% of the amount of the share capital of Codere Online. The general meeting of shareholders shall resolve how the remainder of the annual net profits, after allocation to the Legal Reserve, will be disposed of by allocating the whole or part of the remainder to a reserve or to a provision, by carrying it forward to the next following financial year or by distributing it, together with carried forward profits, distributable reserves or share premium to the shareholders, each Ordinary Share entitling to the same proportion in such distributions.

The Codere Online Board may resolve that Codere Online pays out an interim dividend to the shareholders, subject to the conditions of article 461-3 of the 1915 Law and Codere Online's articles of association. The Codere Online Board shall set the amount and the date of payment of the interim dividend.

Any share premium, assimilated premium or other distributable reserve may be freely distributed to the shareholders subject to the provisions of the 1915 Law and Codere Online's articles of association. In case of a dividend payment, each shareholder is entitled to receive a dividend right pro rata according to his or her respective shareholding. The dividend entitlement lapses upon the expiration of a five-year prescription period from the date of the dividend distribution. The unclaimed dividends return to Codere Online's accounts.

There are no current plans to pay cash dividends on the Ordinary Shares. When determining or proposing a dividend payment, the Codere Online Board may take into account general and economic conditions, Codere Online's financial condition and operating results, Codere Online's available cash, current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions, implications on the payment of dividends by Codere Online to its shareholders and such other factors as the Codere Online Board may deem relevant. Accordingly, Codere Online is not expected to pay any dividends on the Ordinary Shares in the foreseeable future.

**B.** **Significant Changes** 

No significant change has occurred since the date of the annual financial statements included in this annual report.

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**Item 9. The Offer and Listing**

**A.** **Offer and Listing Details** 

The Ordinary Shares and Codere Online Warrants are listed on Nasdaq under the symbols "CDRO" and "CDROW," respectively.

**B.** **Plan of Distribution** 

Not applicable.

**C.** **Markets** 

See Item 9.A. "*Offer and Listing Details*."

**D.** **Selling Shareholders** 

Not applicable.

**E.** **Dilution** 

Not applicable.

**F.** **Expenses of the Issue** 

Not applicable.

**Item 10. Additional Information**

**A.** **Share Capital** 

Not applicable.

**B.** **Memorandum and Articles of Association** 

A copy of the articles of association of Codere Online is attached as Exhibit 1.1 to this annual report. The information called for by this Item 10.B. "*Memorandum and Articles of Association*" has been reported previously in our Registration Statement on Form F-1, filed with the SEC on February 24, 2022 (the "F-1 Registration Statement"), under the heading "*Description of Securities*," and is incorporated by reference into this annual report. There are no limitations on the rights to own securities, including the rights of non-resident or foreign shareholders to hold or exercise voting rights on the securities imposed by the laws of Luxembourg or by our articles of association. Additional information called for by this Item 10.B. "*Memorandum and Articles of Association*" is set forth in Exhibit 2.1 to this annual report and is incorporated by reference into this annual report.

**C.** **Material Contracts** 

Each material contract to which Codere Online has been a party for the preceding two years, other than those entered into in the ordinary course of business, is listed as an exhibit to this annual report and is summarized below, under Item 7.B. "*Related Party Transactions*" and elsewhere herein. The information below describes certain agreements entered into in connection with the Business Combination, but does not purport to describe all of the terms thereof. The full text of these agreements, or forms thereof, are included as exhibits to the Business Combination Agreement attached hereto as an exhibit, and the following descriptions are qualified in their entirety by reference to the full text of such exhibits.

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***Business Combination Agreement***

On June 21, 2021, DD3, Codere Newco, SEJO, Codere Online and Merger Sub entered into the Business Combination Agreement, which contained customary representations and warranties, covenants, closing conditions, expenses provisions and other terms relating to the Merger and the other transactions contemplated thereby, as summarized below. Capitalized terms used in this section but not otherwise defined herein have the meanings given to them in the Business Combination Agreement.

Pursuant to the Business Combination Agreement, following the effectiveness of the transactions contemplated by the Exchange at the Exchange Effective Time and the Merger on the Merger Effective Time, the parties consummated the Business Combination and SEJO and DD3 became direct wholly-owned subsidiaries of Codere Online. Pursuant to the Business Combination Agreement, each of the following transactions occurred in the following order:

● pursuant to the Contribution and Exchange Agreement, Codere Newco, effective on the Exchange Effective Time, contributed its SEJO Ordinary Shares constituting all the issued and outstanding share capital of SEJO to Codere Online in exchange for additional Ordinary Shares, which were subscribed for by Codere Newco. As a result of the Exchange, SEJO became a wholly-owned subsidiary of Codere Online and Codere Online continued to be a wholly-owned subsidiary of Codere Newco at the Exchange Effective Time;

● after the Exchange and immediately prior to the Merger Effective Time, each share of DD3 Class B Common Stock automatically converted into and exchanged for one share of DD3 Class A Common Stock pursuant to the Class B Conversion;

● on the Closing Date, pursuant to the Merger, Merger Sub merged with and into DD3, with DD3 surviving such merger and becoming a direct wholly-owned subsidiary of Codere Online and, in connection therewith, DD3's corporate name changed to "Codere Online U.S. Corp.";

● in connection with the Merger, all shares of DD3 Class A Common Stock issued and outstanding immediately prior to the Merger Effective Time, but after the Class B Conversion, were contributed to Codere Online in exchange for the Merger Consideration in the form of one Ordinary Share for each share of DD3 Class A Common Stock pursuant to the Codere Online Capital Increase, as set forth in the Business Combination Agreement; and

● as of the Merger Effective Time, each DD3 Warrant that was outstanding immediately prior to the Merger Effective Time no longer represented a right to acquire one share of DD3 Class A Common Stock and instead represented the right to acquire one Ordinary Share on substantially the same terms.

Codere Newco received the Exchange consideration in the form of Ordinary Shares on the Exchange Effective Time. The Ordinary Shares making up the Exchange consideration, minus any Ordinary Shares owned by Codere Newco immediately prior to the Exchange Effective Time, were issued to Codere Newco. After such issuance and as of the date of this annual report, Codere Newco held 30,000,000 Ordinary Shares.

At the Merger Effective Time, each share of DD3 Class A Common Stock issued and outstanding immediately prior to the Merger Effective Time was exchanged for one validly issued and fully paid Ordinary Share.

***Contribution and Exchange Agreement***

Contemporaneously with the execution and delivery of the Business Combination Agreement, Codere Online, SEJO and Codere Newco entered into the Contribution and Exchange Agreement, pursuant to which Codere Newco agreed to implement the Exchange by contributing all of the issued and outstanding SEJO Ordinary Shares in exchange for 30,000,000 Ordinary Shares (reduced by the Ordinary Shares held by Codere Newco immediately prior to the Exchange) valued at $300,000,000, on a cash-free and debt-free basis, and subject to a normalized level of working capital of Codere Online, SEJO and SEJO's subsidiaries, which valuation was confirmed in a valuation report issued at the Exchange Effective Time by a Luxembourg independent auditor (*réviseur d'entreprises*). The Contribution and Exchange Agreement contains customary conditions, covenants, representations and warranties.

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***Subscription Agreements***

The purpose of the PIPE was to raise additional capital for use in connection with the Business Combination and to assist in meeting the minimum cash requirement, which was a condition to the consummation of the Business Combination in the Business Combination Agreement.

Contemporaneously with the execution and delivery of the Business Combination Agreement, DD3 entered into two separate Subscription Agreements with DD3 Capital and Larrain, in each case to which Codere Online is also a party, pursuant to which DD3 issued and sold, in a private placement that closed immediately prior to the Closing, (i) an aggregate of 500,000 shares of DD3 Common Stock, for an aggregate purchase price of $5,000,000, at a price of $10.00 per each share of DD3 Common Stock, to DD3 Capital and its permitted transferees, and (ii) an aggregate of 1,211,000 shares of DD3 Common Stock, for an aggregate purchase price of $12,110,000, at a price of $10.00 per each share of DD3 Common Stock, to Larrain and its permitted transferees, in each case which shares of DD3 Common Stock became Ordinary Shares as a result of the Merger.

Pursuant to the Subscription Agreements, Codere Online agreed that, within 30 calendar days after the Closing, Codere Online would file with the SEC the Registration Statement (as defined in the Subscription Agreements), and Codere Online would use its commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof; provided, however, that Codere Online's obligations to include the Ordinary Shares held by a Subscriber in the Registration Statement would be contingent upon the respective Subscriber furnishing in writing to Codere Online such information regarding the Subscriber, such Ordinary Shares held by such Subscriber and the intended method of disposition of such shares as shall be reasonably requested by Codere Online to effect the registration, and will execute such documents in connection with such registration as Codere Online may reasonably request that are customary of a selling stockholder in similar situations. Notwithstanding anything to the contrary in the Subscription Agreements, Codere Online may, upon giving prompt written notice of such action to the respective Subscriber, delay the filing or initial effectiveness of, suspend use of, the Registration Statement for a period of not more than sixty (60) consecutive days or more than two times in any calendar year if the filing, initial effectiveness or continued use of the Registration Statement would, in the good faith judgment of the Codere Online Board, make Codere Online fail to comply with applicable disclosure requirements or would require the inclusion in such Registration Statement of (i) financial statements that are unavailable to Codere Online for reasons beyond Codere Online's control, (ii) audited financial statements as of a date other than Codere Online's fiscal year end, or (iii) pro forma financial statements that are required to be included in a registration statement. Codere Online made use of such right under the Subscription Agreements and notified the relevant Subscribers and certain other holders of Codere Online securities

Pursuant to the Subscription Agreements, each Subscriber acknowledged and agreed that, without the prior written consent of DD3 and Codere Online, during the period commencing on the Closing Date and continuing until the earlier of the ninety (90) calendar day period commencing on the date of the closing of the Business Combination and the date when the Registration Statement is declared effective by the SEC, such Subscriber, and any person or entity acting on its behalf or pursuant to any understanding with it, would not (i) sell, assign, transfer (including by operation of law), incur any liens, charges, security interests, options, claims, mortgages, pledges, proxies, voting trusts or agreements, obligations, understandings or arrangements or other restrictions on title or transfer of any nature whatsoever, dispose of or otherwise encumber, (ii) make any short sale of, grant any option for the purchase of, or (iii) enter into any hedging or similar transaction with the same economic effect as a transfer in sub-section (i) above of, any of the PIPE Shares.

***Forward Purchase Agreements***

In connection with the Business Combination, (i) Baron elected to purchase an aggregate of 2,500,000 shares of DD3 Common Stock for an aggregate purchase price of $25,000,000, at a price of $10.00 per each share of DD3 Common Stock, pursuant to the terms of the Baron Forward Purchase Agreement, and (ii) MG elected to purchase an aggregate of 2,500,000 shares of DD3 Common Stock for an aggregate purchase price of $25,000,000, at a price of $10.00 per each share of DD3 Common Stock, pursuant to the terms of the MG Forward Purchase Agreement, in each case in a private placement that occurred immediately prior to the Closing Date.

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Pursuant to the Baron FPA Amendment and the MG FPA Amendment, among other matters, (i) DD3 agreed not to enter into any agreement with any other investor or prospective investor on terms that are more favorable to such other investor or prospective investor than the terms provided to Baron or MG, as applicable, and (ii) certain closing conditions were amended in part to align with the closing conditions in the Business Combination Agreement, including that the terms of the Business Combination Agreement (as the same existed on the date of the Baron FPA Amendment and the MG FPA Amendment) shall not have been amended or modified in a manner, and no waiver thereunder shall have occurred, that would reasonably be expected to be materially adverse to the economic benefits that Baron or MG would reasonably expect to receive under their respective Forward Purchase Agreement, without Baron's or MG's written consent, as applicable.

***Baron Support Agreement***

Contemporaneously with the execution and delivery of the Business Combination Agreement, DD3 and Baron entered into the Baron Support Agreement, pursuant to which Baron irrevocably waived its Redemption Rights with respect to the Baron IPO Shares and agreed not to (a) redeem or exercise any of its Redemption Rights with respect to, any Baron IPO Shares in connection with DD3's special meeting of stockholders that approved the Business Combination Agreement and the transactions contemplated by the Business Combination Agreement; or (b) directly or indirectly, (i) sell, assign, transfer (including by operation of law), lien, pledge, dispose of or otherwise encumber any of the Baron IPO Shares or otherwise agree to do any of the foregoing, (ii) deposit any Baron IPO Shares into a voting trust or enter into a voting agreement or arrangement or grant any proxy or power of attorney with respect thereto that is inconsistent with the Baron Support Agreement, or (iii) enter into any contract, option or other arrangement or undertaking with respect to the direct or indirect acquisition or sale, assignment, transfer (including by operation of law) or other disposition of any Baron IPO Shares. The Baron Support Agreement and the obligations of Baron under the Baron Support Agreement automatically terminated upon the Closing of the Business Combination. The Baron Support Agreement was subject to customary conditions, covenants, representations and warranties.

Pursuant to the Business Combination Agreement, DD3 undertook not to amend, modify, waive or otherwise change any of the Baron Support Agreement, Forward Purchase Agreements and Subscription Agreements without the prior written consent of SEJO, such consent not to be unreasonably withheld, delayed or conditioned.

***Registration Rights and Lock-Up Agreement***

In connection with the Business Combination, DD3, Codere Newco, Codere Online, the Sponsor, the Forward Purchasers and the other parties thereto, entered into the Registration Rights and Lock-Up Agreement, which provided customary demand and piggyback registration rights. Pursuant to the Registration Rights and Lock-Up Agreement, Codere Online agreed that, within 30 calendar days after the Closing Date, it would file with the SEC a registration statement to permit the public resale of certain Ordinary Shares and Codere Online Warrants (including underlying securities) held by the Holders (as defined in the Registration Rights and Lock-Up Agreement), and that it would use its reasonable best efforts to have the registration statement declared effective as soon as practicable after the filing thereof, but no later than 60 calendar days following the filing deadline, provided that the effectiveness deadline will be extended to 90 calendar days after the filing deadline if the registration statement is reviewed by, and receives comments from, the SEC.

Subject to certain terms and conditions, Codere Online may delay the filing or initial effectiveness of, or suspend use of, such registration statement for the shortest period of time, but in no event for a period more than sixty (60) consecutive days or more than two times in any calendar year.

In addition, pursuant to the terms of the Registration Rights and Lock-Up Agreement and subject to certain requirements and customary conditions, including with regard to the number of demand rights that may be exercised, certain holders may demand at any time or from time to time, that Codere Online file a registration statement on Form F-1, or any such other form of registration statement as is then available to effect a registration, or, if available, Form F-3, to register the securities of Codere Online held by such holders. The Registration Rights and Lock-Up Agreement also provide the Holders with "piggy-back" registration rights, subject to certain requirements and customary conditions. Further, pursuant to the Registration Rights and Lock-Up Agreement, the parties agreed that no registration shall be effected with respect to Lock-Up Securities held by Codere Newco or the Sponsor, until after the expiration of the lock-up period.

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Pursuant to the Registration Rights and Lock-Up Agreement, each of Codere Newco and the Sponsor agreed to not transfer any Lock-Up Securities (as defined in the Registration Rights and Lock-Up Agreement) until the earliest of: (i) the date that is one year from the Closing, (ii) the date on which the closing price of the Ordinary Shares on Nasdaq equals or exceeds $12.50 per Ordinary Share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing 150 days after the Closing or (iii) such date on which Codere Online completes a liquidation, merger, share exchange or other similar transaction that results in all Codere Online shareholders having the right to exchange their Ordinary Shares for cash, securities or other property, subject to certain exceptions described in Section 5.2 of the Registration Rights and Lock-Up Agreement. Further, pursuant to the Registration Rights and Lock-Up Agreement, the parties agreed that no registration shall be effected with respect to Lock-Up Securities held by Codere Newco or the Sponsor, until after the expiration of the lock-up period. As of the date of this annual report, the lock-up restrictions under the Registration Rights and Lock-Up Agreement have expired.

***Nomination Agreement***

In connection with the Closing of the Business Combination, the Sponsor, Codere Newco and Codere Online entered into a Nomination Agreement, pursuant to which Codere Newco and the Sponsor have, among others, certain director nomination rights with respect to Codere Online.

Pursuant to the Nomination Agreement, during the Sponsor Proposal Period, the Codere Online Board will consist of seven (7) directors and (i) Codere Newco will have the right to propose for appointment four (4) Codere Newco Directors; (ii) the Sponsor will have the right to propose for appointment two (2) Sponsor Directors; and (iii) Codere Newco and the Sponsor will have the right to jointly propose for appointment the Industry Expert Independent Director. After the Sponsor Proposal Period, Codere Newco will have the right to propose for appointment five (5) directors, with at least two (2) of them having to qualify as independent directors (subject to independence requirements under applicable securities exchange rules that may require a greater number of independent directors). Both during and after the Sponsor Proposal Period, at least one (1) of the Codere Newco Directors shall qualify as a Luxembourg tax resident.

Codere Newco will have the right to propose for reappointment the Codere Newco Directors and the Sponsor will have the right to propose for reappointment the Sponsor Directors appointed within the Sponsor Proposal Period; provided that one (1) Sponsor Director shall not have the right to serve as director past the second annual shareholders' meeting of Codere Online after the Closing Date and the second Sponsor Director shall not have the right to serve as director past the third annual shareholders' meeting of Codere Online after the Closing Date.

Pursuant to the Nomination Agreement, the Codere Online audit committee shall include at least one (1) Codere Newco Director and one (1) Sponsor Director (in either case only to the extent such director (i) qualifies as an independent director and (ii) meets the heightened independence requirements applicable to audit committees under the SEC rules and regulations and under the criteria established by the Nasdaq). Further, Codere Newco will have the right, but not the obligation, to propose for appointment one (1) non-executive, non-independent director as an observer to the audit committee to be appointed by the Codere Online Board, subject to compliance with Rule 10A-3 under the Exchange Act.

Codere Newco and the Sponsor agreed to cooperate in facilitating any action or right described in or required by the Nomination Agreement, including by voting their respective Ordinary Shares. Other than reimbursement for reasonable and documented out-of-pocket expenses, only the Remunerated Directors are currently expected to be entitled to compensation as consideration for serving on the Codere Online Board and/or any committees. See the section entitled "*Management*" for additional information.

Unless earlier terminated by the mutual agreement of Codere Online, Codere Newco and the Sponsor, the Nomination Agreement shall continue in full force and effect for a period of five years from the Closing Date; provided, however, that the Nomination Agreement will automatically terminate, with respect to Codere Newco, on the date on which Codere Newco and/or its affiliates cease to beneficially own, in the aggregate, at least 30% of the issued and outstanding Ordinary Shares, and with respect to the Sponsor, after the Sponsor Proposal Period; provided, further, that Codere Newco and Codere Online shall, no later than 30 days prior to the fifth anniversary of the Nomination Agreement, agree in writing to renew the Nomination Agreement, with respect to Codere Newco and Codere Online, for an additional five years if Codere Newco and/or its affiliates beneficially own, in the aggregate, no less than 30% of the issued and outstanding Ordinary Shares.

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***Indemnification Letter***

In connection with the Closing of the Business Combination, Codere Newco, Codere Online and SEJO agreed to cause the Restructuring and entered into the Indemnification Letter, pursuant to which Codere Newco shall indemnify Codere Online, SEJO and their respective subsidiaries ("Indemnitees"), including under the principles of transferee or successor liability but excluding any debts, losses, damages, fines, penalties, expenses and liabilities ("Liabilities") reflected or reserved against in the Year-End Financial Statements (as defined in the Business Combination Agreement) or the Interim Financial Statement (as defined in the Business Combination Agreement), for (i) Liabilities incurred by any Indemnitee and arising under or in connection with the ownership of the assets (other than entities, assets or rights to be transferred to SEJO or its subsidiaries pursuant to the Restructuring) of, or the operation of the business (other than the online business) by, Codere Newco or any affiliate of Codere Newco (excluding Codere Online, Merger Sub, SEJO and its subsidiaries) ("Non-Online Losses"); (ii) Liabilities incurred by any Indemnitee as a result of the consummation of the Restructuring, but only to the extent that such Liabilities would not have been incurred but for the Restructuring ("Restructuring Losses"); and (iii) Taxes (as defined in the Business Combination Agreement) of any Indemnitee, including Transfer Taxes (as defined in the Business Combination Agreement), incurred by any Indemnitee as a result of the consummation of the Restructuring, but only to the extent that such Taxes would not have been incurred but for the Restructuring (such Taxes in (iii), together with Non-Online Losses and Restructuring Losses, "Losses"). The obligations of Codere Newco to indemnify and hold harmless the Indemnitees against, or to contribute to, Losses pursuant to the Indemnification Letter shall remain in full force and effect until the date that is 24 months after the Closing Date. The aggregate amount of all Losses for which Codere Newco shall be liable pursuant to the Indemnification Letter, including, for the avoidance of doubt, any legal or other expenses incurred by the Indemnitees and required to be paid by Codere Newco in connection with investigating and defending any related action or claim, shall not exceed $10,000,000 in the aggregate.

***Warrant Amendment Agreement***

In connection with the Closing of the Business Combination, DD3, Codere Online and Continental Stock Transfer & Trust Company, as warrant agent, entered into the Warrant Amendment Agreement, pursuant to which, among others, as of the Merger Effective Time, (i) each of the issued DD3 Warrants that was outstanding immediately prior to the Merger Effective Time ceased to represent a right to acquire one share of DD3 Class A Common Stock and instead represented the right to acquire one Ordinary Share on substantially the same terms as set forth in the Original Warrant Agreement and (ii) DD3 assigned to Codere Online all of DD3's right, title and interest in and to the Original Warrant Agreement and Codere Online assumed, and agreed to pay, perform, satisfy and discharge in full, all of DD3's liabilities and obligations under the Original Warrant Agreement arising from and after the Merger Effective Time.

***Expenses Reimbursement Letter***

In connection with the Closing of the Business Combination, DD3, Codere Newco, Codere Online and the Sponsor entered into the Expenses Reimbursement Letter, pursuant to which (i) the Sponsor agreed to reimburse Codere Online, as sole shareholder of the Surviving Corporation, for the aggregate amount of SPAC Transaction Expenses (as defined in the Business Combination Agreement) payable by the Surviving Corporation in excess of the maximum SPAC Transaction Expenses (as defined in the Business Combination Agreement) required to be paid by the Surviving Corporation pursuant to Section 11.03 of the Business Combination Agreement, subject to Sections 1 and 2 of the Expenses Reimbursement Letter; and (ii) Codere Newco agreed to reimburse Codere Online, as sole shareholder of SEJO and the Surviving Corporation, for the aggregate amount of Company Transaction Expenses (as defined in the Business Combination Agreement) payable by the Surviving Corporation, Codere Online, SEJO or any of its subsidiaries in excess of the maximum Company Transaction Expenses (as defined in the Business Combination Agreement) required to be paid by the Surviving Corporation pursuant to Section 11.03 of the Business Combination Agreement, subject to Sections 1 and 2 of the Expenses Reimbursement Letter.

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**D.** **Exchange Controls and Other Limitations Affecting Security Holders** 

We are not aware of any governmental laws, decrees, regulations or other legislation in Luxembourg that restrict the export or import of capital, including the availability of cash and cash equivalents for use by Codere Online, or that affect the remittance of dividends, interest or other payments to non-resident holders of our securities, except for regulations restricting the remittance of dividends, distributions, and other payments in compliance with United Nations and/or EU sanctions.

We currently do not expect to be affected by the existing capital controls in Argentina, which would otherwise restrict our ability to extract cash from the country, given that we expect that cash generated in Argentina will, for the foreseeable future, be reinvested into the business in furtherance of our growth plan in the country. However, we may be affected when we transfer funds to our subsidiary in Argentina from time to time.

**E.** **Taxation** 

**U.S. Federal Income Tax Considerations**

This section describes material U.S. federal income tax consequences to the U.S. holders described below of the ownership and disposition of Ordinary Shares or Codere Online Warrants (collectively, "Codere Online securities"). This discussion applies only to Codere Online securities held as capital assets for U.S. federal income tax purposes (generally, property held for investment) and does not discuss all aspects of U.S. federal income taxation that may be relevant to U.S. holders in light of their particular circumstances or status, including alternative minimum tax consequences, Medicare contribution tax consequences and any impact of the special tax accounting rules under Section 451(b) of the Code, or to U.S. holders subject to special rules, including:

● dealers and other investors that do not hold their Codere Online securities as capital assets;

● traders in securities that elect to use a mark-to-market method of tax accounting for their securities holdings;

● tax-exempt organizations, qualified retirement plans, individual retirement accounts or other tax deferred accounts;

● banks or other financial institutions, underwriters, insurance companies, real estate investment trusts or regulated investment companies;

● certain U.S. expatriates or former long-term residents of the United States;

● persons that own (directly, indirectly, or by attribution) 10% or more (by vote or value) of Codere Online's stock;

● partnerships or other pass-through entities for U.S. federal income tax purposes or beneficial owners thereof;

● persons who hold Codere Online securities as part of a straddle, integrated transaction or other similar transaction;

● U.S. holders (as defined below) whose functional currency is not the U.S. dollar;

● U.S. holders that hold Codere Online securities in connection with a trade or business conducted outside the United States; or

● persons that received Codere Online securities as compensation for services.

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This discussion is based on the Code, its legislative history, existing and proposed Treasury regulations promulgated under the Code (the "Treasury Regulations"), published rulings by the IRS and court decisions, and the income tax treaty between the United States and Luxembourg (the "Treaty"), all as of the date hereof, any of which is subject to change, possibly on a retroactive basis. This discussion is necessarily general and does not address all aspects of U.S. federal income taxation, including the effect of the U.S. federal alternative minimum tax, or U.S. federal estate and gift tax, or any state, local or non-U.S. tax laws to a U.S. holder of Codere Online securities.

For purposes of this discussion, a U.S. holder means a person who is eligible for the benefits of the Treaty and is, for U.S. federal income tax purposes, a beneficial owner of Codere Online securities and:

● an individual who is a citizen or resident of the United States;

● a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

● an estate whose income is subject to U.S. federal income tax regardless of its source; or

● a trust if (1) a U.S. court can exercise primary supervision over the trust's administration and one or more U.S. persons are authorized to control all substantial decisions of the trust; or (2) the trust has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

This discussion assumes that our position as to us being tax resident solely in Luxembourg is respected. U.S. Holders should consult their own tax advisers regarding any tax consequences that may arise if we were treated as a tax resident of any other jurisdiction.

U.S. HOLDERS SHOULD CONSULT WITH THEIR TAX ADVISERS REGARDING THE TAX CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF CODERE ONLINE SECURITIES, INCLUDING THE EFFECTS OF U.S. FEDERAL, STATE, AND LOCAL AND NON-U.S. TAX LAWS.

**U.S. Federal Income Tax Treatment of Codere Online**

As described in Item 3.D. "*Risk Factors—Risks Relating to U.S. Taxes—The Internal Revenue Service may not agree that Codere Online should be treated as a non-U.S. corporation for U.S. federal income tax purposes*," Codere Online believes that it should not be treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874 of the Code, and the remainder of this discussion so assumes.

***Ownership of Ordinary Shares and Codere Online Warrants***

*Distributions on Ordinary Shares*

The following discussion is subject to the discussion in "—*Passive Foreign Investment Company Rules*" below.

The gross amount of any distribution on Ordinary Shares that is made out of Codere Online's current or accumulated earnings and profits (as determined for U.S. federal income tax purposes) generally will be taxable to a U.S. holder as dividend income on the date such distribution is actually or constructively received. Because Codere Online does not maintain calculations of its earnings and profits in accordance with U.S. federal income tax principles, U.S. holders should expect that any distribution by Codere Online with respect to the Ordinary Shares will be reported to them as dividend income. Any dividends will not be eligible for the dividends-received deduction allowed to corporations in respect of dividends received from U.S. corporations.

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Subject to applicable limitations, dividends paid to non-corporate U.S. Holders may be eligible for a preferential rate of taxation. The preferential rate will not apply, however, if Codere Online is a passive foreign investment company for its taxable year in which it pays a dividend or for the preceding taxable year. See "—*Passive Foreign Investment Company Rules.*"

Subject to certain conditions and limitations, Luxembourg withholding taxes on dividends paid by Codere Online that are withheld at a rate not in excess of the applicable Treaty rate may be creditable against a U.S. holder's U.S. federal income tax liability. For purposes of calculating the U.S. foreign tax credit, dividends paid on the Ordinary Shares will generally be treated as income from sources outside the United States and will generally constitute passive category income. The rules governing foreign tax credits are complex. For example, Treasury regulations provide that, in the absence of an election to apply the benefits of an applicable income tax treaty, in order for foreign income taxes to be creditable the relevant foreign income tax rules must be consistent with certain U.S. federal income tax principles, and we have not determined whether the Luxembourg income tax system meets this requirement. In lieu of claiming a foreign tax credit, a U.S. holder may elect to deduct creditable non-U.S. taxes (including Luxembourg taxes) in computing its taxable income, subject to applicable limitations. An election to deduct creditable foreign taxes instead of claiming foreign tax credits applies to all creditable foreign taxes paid or accrued in the taxable year. The rules governing the U.S. foreign tax credits and deductibility of foreign taxes are complex. U.S. holders should consult their tax advisers regarding the availability of U.S. foreign tax credits or deductions under their particular circumstances.

*Sale, Exchange, Redemption or Other Taxable Disposition of Ordinary Shares or Codere Online Warrants*

The following discussion is subject to the discussion in "—*Passive Foreign Investment Company Rules*" below.

A U.S. holder generally will recognize gain or loss on any sale, exchange or other taxable disposition of Ordinary Shares or Codere Online Warrants (including a redemption of Codere Online Warrants) in an amount equal to the difference between (i) the amount realized on the disposition and (ii) such U.S. holder's adjusted tax basis in such shares or warrants. Any gain or loss recognized by a U.S. holder on a taxable disposition of Ordinary Shares or Codere Online Warrants generally will be capital gain or loss, and will be long-term capital gain or loss if the U.S. holder's holding period in such shares and/or warrants exceeds one year at the time of the disposition. Preferential tax rates may apply to long-term capital gains of non-corporate U.S. holders. The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. holder on the sale or exchange of Ordinary Shares or Codere Online Warrants generally will be U.S. source gain or loss.

*Exercise or Lapse of a Codere Online Warrant*

A U.S. holder generally will not recognize gain or loss upon the acquisition of an Ordinary Share on the exercise of a Codere Online Warrant for cash. A U.S. holder's tax basis in the Ordinary Shares received upon exercise of Codere Online Warrants generally should be an amount equal to the sum of the U.S. holder's tax basis in the Codere Online Warrants and the exercise price. The U.S. holder's holding period for an Ordinary Share received upon exercise of the Codere Online Warrant will begin on the date following the date of exercise (or possibly the date of exercise) of the Codere Online Warrant and will not include the period during which the U.S. holder held the Codere Online Warrant. If a Codere Online Warrant is allowed to lapse unexercised, a U.S. holder generally will recognize a capital loss equal to such holder's tax basis in the Codere Online Warrant.

The tax consequences of a cashless exercise of a Codere Online Warrant are not clear under current tax law. A cashless exercise may be tax-deferred, either because the exercise is not a gain realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either case, a U.S. holder's basis in the Ordinary Shares received would equal the U.S. holder's basis in the Codere Online Warrants exercised therefor. If the cashless exercise is treated as not being a gain realization event, a U.S. holder's holding period in the Ordinary Shares will commence on the date following the date of exercise (or possibly the date of exercise) of the Codere Online Warrants. If the cashless exercise is treated as a recapitalization, the holding period of the Ordinary Shares will include the holding period of the Codere Online Warrants exercised therefor.

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It is also possible that a cashless exercise of a Codere Online Warrant could be treated in part as a taxable exchange in which gain or loss will be recognized. In such event, a U.S. holder will recognize gain or loss with respect to the portion of the exercised Codere Online Warrants treated as surrendered to pay the exercise price of the Codere Online Warrants (the "surrendered warrants"). The U.S. holder will recognize capital gain or loss with respect to the surrendered warrants in an amount generally equal to the difference between (i) the total exercise price for the total number of warrants to be exercised and (ii) the U.S. holder's adjusted basis in the warrants deemed surrendered. In this case, a U.S. holder's tax basis in the Ordinary Shares received will equal the U.S. holder's tax basis in the Codere Online Warrants exercised plus (or minus) the gain (or loss) recognized with respect to the surrendered warrants. A U.S. holder's holding period for the Ordinary Shares will commence on the date following the date of exercise (or possibly the date of exercise) of the Codere Online Warrants.

Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise of warrants, there can be no assurance which, if any, of the alternative tax consequences and holding periods described above will be adopted by the IRS or a court of law. Accordingly, U.S. holders should consult their tax advisers regarding the tax consequences of a cashless exercise of Codere Online Warrants.

*Possible Constructive Distributions*

The terms of each Codere Online Warrant provide for an adjustment to the number of Ordinary Shares for which the Codere Online Warrant may be exercised or to the exercise price of the Codere Online Warrant in certain events, as discussed in Item 10.B. "*Memorandum and Articles of Association.*" An adjustment which has the effect of preventing dilution generally is not taxable. A U.S. holder of a Codere Online Warrant will, however, be treated as receiving a constructive distribution from Codere Online if, for example, the adjustment increases the holder's proportionate interest in Codere Online's assets or earnings and profits (*e.g.*, through an increase in the number of Ordinary Shares that will be obtained upon exercise of such warrant) as a result of a distribution of cash to the holders of the Ordinary Shares which is taxable to the U.S. holders of such shares as described under *"—Distributions on Ordinary Shares*" above. Such constructive distribution will be subject to tax as described under that section in the same manner as if the U.S. holder of such warrant received a cash distribution from Codere Online equal to the fair market value of such increased interest.

*Passive Foreign Investment Company Rules*

*Generally.* The treatment of U.S. holders could be materially different from that described above if Codere Online is a passive foreign investment company (a "PFIC") for U.S. federal income tax purposes for any taxable year. A non-U.S. corporation is a PFIC for any taxable year if either: (i) 75% or more of its gross income for the taxable year constitutes passive income for purposes of the PFIC rules, or (ii) 50% or more of its assets (generally determined based on the quarterly average of the value of its assets during such year) is attributable to assets that produce, or are held for the production of, passive income. Passive income generally includes dividends, interest, certain royalties and rents, annuities, net gains from the sale or exchange of property producing passive income and net foreign currency gains. Cash is generally a passive asset. Goodwill is an active asset to the extent attributable to activities that produce active income. The determination of whether a non-U.S. corporation is a PFIC is based upon the composition of its income and assets (including, among others, its proportionate share of the income and assets of any other corporation in which it owns, directly or indirectly, 25% (by value) of the stock), and the nature of its activities. A separate determination must be made after the close of each taxable year as to whether a non-U.S. corporation was a PFIC for that year.

Based on the composition of Codere Online's income and assets and the estimated value of its assets, including goodwill (which is based in part on the price of the Ordinary Shares), Codere Online believes that it was not a PFIC for its 2023 taxable year. However, Codere Online's PFIC status for any taxable year can be determined only after the end of that year and will depend on the composition of Codere Online's income and assets and the value of its assets from time to time (which may be determined, in large part, by reference to the market price of Ordinary Shares, which has declined since the Merger). In particular, Codere Online holds a substantial amount of cash and while that continues to be the case its PFIC status for any taxable year will depend primarily on the average value of its goodwill. Because Codere Online's market capitalization has been volatile and declined substantially since the closing of the Merger, if the value of Codere Online's goodwill is determined by reference to its market capitalization there is a significant risk that the Codere Online will be a PFIC for its current taxable year of 2024, and possibly future taxable years. Therefore, Codere Online cannot express any expectation or assurance regarding its PFIC status for the current or any future taxable year.

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The Code provides that, to the extent provided in Treasury regulations, if any person has an option to acquire shares of a PFIC, the shares will be considered as owned by that person. Under proposed Treasury regulations that have a retroactive effective date, an option to acquire shares of a PFIC is generally treated as ownership of those PFIC shares. The remainder of this discussion assumes that the PFIC rules will apply to Codere Online Warrants if Codere Online were a PFIC. However, U.S. holders should consult their tax advisers regarding the application of the PFIC rules to Codere Online Warrants prior to the finalization of the proposed Treasury regulations.

If Codere Online is a PFIC for any taxable year and any subsidiary or other entity in which Codere Online owns equity interests is also a PFIC (any such entity, a "lower-tier PFIC"), a U.S. holder will be deemed to own a proportionate amount (by value) of the shares of each such lower-tier PFIC and will be subject to U.S. federal income tax according to the excess distribution rules described below on (i) certain distributions by any lower-tier PFIC and (ii) dispositions of shares of any lower-tier PFIC, in each case, as if the U.S. holder held such shares directly, even though the U.S. holder will not receive any proceeds of those distributions or dispositions.

If Codere Online is or becomes a PFIC during any taxable year in which a U.S. holder holds Ordinary Shares (or under the proposed regulations, Codere Online Warrants), the U.S. holder will generally be subject to the excess distribution regime (which is the default regime), unless (in the case of Ordinary Shares) a mark-to-market election is made as described further below. Dividends paid by a PFIC are not eligible for the lower rates of taxation applicable to qualified dividend income ("QDI") under any of the foregoing regimes.

*Excess Distribution Regime.* If a U.S. holder does not make a mark-to-market election, as described below, the U.S. holder will be subject to the default "excess distribution regime" under the PFIC rules with respect to (i) any gain realized on a sale or other disposition (including in certain cases, a pledge) of Ordinary Shares (or under the proposed regulations, Codere Online Warrants), and (ii) any "excess distribution" received on the Ordinary Shares (generally, the excess of distributions received in a taxable year over 125% of the average of the annual distributions on Ordinary Shares received during the preceding three taxable years or the U.S. holder's holding period, whichever is shorter). Generally, under this excess distribution regime:

● the gain or excess distribution will be allocated ratably over the period during which the U.S. holder held the Ordinary Shares (or Codere Online Warrants);

● the amount allocated to the current taxable year and to any taxable year during the U.S. holder's holding period before the first day of the first taxable year in which Codere Online became a PFIC will be treated as ordinary income; and

● the amount allocated to other prior taxable years not described in the preceding bullet will be subject to the highest tax rate in effect for that taxable year for individuals or corporations, as applicable, and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.

The tax liability for amounts allocated to years prior to the year of disposition or excess distribution will be payable generally without regard to offsets from deductions, losses and expenses. In addition, gains (but not losses) realized on the sale of a U.S. holder's securities cannot be treated as capital gains, even if the U.S. holder holds the securities as capital assets.

If Codere Online is treated as a PFIC for any taxable year during a U.S. holder's holding period it will, with respect to such U.S. holder, continue to be a PFIC for subsequent taxable years, regardless of whether it satisfies either of the income or asset test in these years, subject to certain exceptions (such as upon making a "deemed sale" election).

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*Mark-to-Market Regime.* Alternatively, a U.S. holder of shares of a PFIC may make an election to mark-to-market the shares on an annual basis if the shares are treated as marketable. PFIC shares generally are treated as marketable if they are "regularly traded" on a national securities exchange such as the Nasdaq. There can be no assurance that Ordinary Shares will be regularly traded for purposes of these rules. Pursuant to the mark-to-market election, for each taxable year in which Codere Online is a PFIC a U.S. holder will include as ordinary income the excess, if any, of the fair market value of such stock over its adjusted basis at the end of the taxable year. A U.S. holder will treat as ordinary loss any excess of the adjusted basis of the stock over its fair market value at the end of the year, but only to the extent of the net amount previously included in income as a result of the election in prior years. A U.S. holder's adjusted tax basis in the PFIC shares will be increased to reflect any amounts included in income, and decreased to reflect any amounts deducted, as a result of a mark-to-market election. Any gain recognized on a disposition of Ordinary Shares in a taxable year in which Codere Online is a PFIC will be treated as ordinary income and any loss will be treated as ordinary loss (but only to the extent of the net amount of income previously included as a result of a mark-to-market election, with any excess treated as a capital loss). A mark-to-market election applies for the taxable year in which it is made and for each subsequent taxable year, unless the PFIC shares cease to be marketable or the IRS consents to the revocation of the election. U.S. holders should be aware that there is also no provision in the Code, Treasury Regulations or other published authority that specifically provides that a mark-to-market election with respect to the stock of a publicly-traded holding company (such as Codere Online) effectively exempts stock of any lower-tier PFICs from the negative tax consequences arising from the excess distribution regime described above. U.S. Holders should consult their tax advisers to determine whether the mark-to-market tax election will be available if Codere Online is a PFIC for any taxable year, and the consequences resulting from such election. U.S. holders of Codere Online Warrants will not be able to make a mark-to-market election with respect to their warrants.

Codere Online does not intend to provide information necessary for U.S. holders to make qualified electing fund elections which, if available, would result in tax treatment different from the general tax treatment for PFICs described above.

*PFIC Reporting Requirements.* A U.S. holder that owns (or is deemed to own) shares in a PFIC during any taxable year of the U.S. holder generally is required to file an IRS Form 8621 with such U.S. holder's U.S. federal income tax return and provide such other information as the IRS may require. Failure to file IRS Form 8621 for each applicable taxable year may result in substantial penalties and result in the U.S. holder's taxable years being open to audit by the IRS until such forms are properly filed.

**Information Reporting and Backup Withholding**

Information reporting requirements may apply to dividends received or deemed received with respect to Codere Online securities, and the proceeds received on the disposition of Codere Online securities effected within the United States (and, in certain cases, outside the United States), in each case other than in the case of U.S. holders that are exempt recipients (such as corporations). Backup withholding may apply to such amounts if the U.S. holder fails to provide an accurate taxpayer identification number (generally on an IRS Form W-9) or is otherwise subject to backup withholding. U.S. holders should consult their tax advisers regarding the application of the U.S. information reporting and backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against the U.S. holder's U.S. federal income tax liability, and a holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for a refund with the IRS and furnishing any required information.

Certain U.S. holders who are individuals (or certain specified entities) may be required to report information relating to their ownership of Codere Online securities, or non-U.S. accounts through which the Codere Online securities are held. U.S. holders should consult their own tax advisers regarding their reporting obligations with respect to Codere Online securities.

Former U.S. holders of DD3 Securities that exchanged their DD3 Securities for Codere Online Securities in the Merger are urged to consult with their own tax advisers regarding any reporting requirements that they may have in connection with the Merger.

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**Material Luxembourg Income Tax Considerations**

The following is a general description of certain Luxembourg tax considerations relating to Codere Online and the Codere Online Shareholders and the holders of Codere Online Warrants. It does not purport to be a complete analysis of all tax considerations in relation to the Ordinary Shares and Codere Online Warrants. Shareholders and holders of Codere Online Warrants should consult their own tax advisers as to which countries' tax laws could be relevant to holding and disposing of the securities and the consequences of such actions under the tax laws of those countries. This overview is based upon the law as in effect on the date of this document and is subject to any change in law that may take effect after such date, even with retroactive effect.

The discussion below is intended as a basic overview of certain tax consequences in relation to Codere Online and the purchase, ownership and disposition of Ordinary Shares and Codere Online Warrants under Luxembourg law. Persons who are in any doubt as to their tax position should consult a professional tax adviser.

**Substance**

Under Luxembourg income tax laws, a company is a resident taxpayer of Luxembourg if its statutory seat or its central administration is located in Luxembourg. Having its statutory seat in Luxembourg, Codere Online should therefore be considered as a Luxembourg tax resident company and could then obtain a certificate of residence from the Luxembourg tax authorities. However, it should be noted that most of the double tax treaties signed by Luxembourg include a so-called tie-break rule according to which companies are only tax resident in the jurisdiction where they are effectively managed (i.e., where their central administration is located). In this respect, should Codere Online be effectively managed from a treaty jurisdiction, its Luxembourg tax residency may be challenged by foreign tax authorities.

Moreover, the EU released on December 22, 2021 a directive proposal which aims to fight against the misuse of shell entities for tax purposes and ensure that EU entities with no or minimal economic activity are unable to benefit from certain tax advantages (the so-called ATAD 3). On January 17, 2023, the European Parliament approved the European Commission's draft of ATAD 3, as amended by the Committee on Economic and Monetary Affairs. The draft text may however undergo some changes following negotiations between the Member States. The developments of ATAD 3 and its potential impacts on Codere Online will therefore need to be monitored as discussions progress at EU level.

These new rules would mainly apply to EU entities (i) deriving passive income, (ii) engaged in cross-border transactions and (iii) which outsourced the administration of day-to-day operations and the decision-making on significant functions. EU entities that meet these three conditions would need to declare in their annual tax returns whether they meet indicators of minimum substance and provide related documentary evidence. Entities not meeting those indicators of minimum substance will be presumed not to have sufficient substance for tax purposes (unless they can rebut this presumption by providing evidence (i) of the business activities which they perform to generate their passive income or (ii) that they do not serve the objective of obtaining a tax advantage). In this case and in the absence of rebuttal of the presumption, such EU entities would not be allowed to benefit from the provisions of double tax treaties or certain EU Directives (such as the Interest and Royalties EU Directive). In addition, they would not be entitled to a certificate of tax residence to the extent that such certificate serves to obtain the benefit of the aforementioned provisions.

Although it is too early to anticipate how these rules will be transposed in the EU (and interpreted by the Luxembourg tax authorities), it should be kept in mind that these rules (if and when implemented) may increase the withholding tax cost of investments structured via an intermediate vehicle that (i) does not meet the indicators of minimum substance and (ii) cannot rebut the above presumption of lack of substance.

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**Taxation of Codere Online**

Codere Online is subject to Luxembourg tax on its worldwide profits at the current combined ordinary rate of 24.94% for Luxembourg City, including the 17% corporate income tax, a 6.75% municipal business tax and a solidarity surcharge (together the "Income Tax").

In principle, dividends and capital gains realized by Codere Online are fully subject to Income Tax in Luxembourg. However, provided the conditions of the Luxembourg participation exemption regime are met, dividends or capital gains realized by Codere Online upon the disposal of shares are not taxable in Luxembourg.

**Luxembourg net wealth tax ("NWT") will be due annually by Codere Online at the rate of 0.5% on its total net asset value below or equal to €500 million. The tranche above €500 million will be taxed at a rate of 0.05%.**

Shareholdings qualifying for the Luxembourg participation exemption regime are excluded from the NWT basis provided that, the relevant entity holds a direct shareholding in a qualifying subsidiary representing at least 10% of the qualifying subsidiary's share capital or having an acquisition cost (including both share capital and share premium) of at least €1.2 million; there is no minimum holding period requirement.

Companies for which the sum of fixed financial assets (i.e., financial assets notably including shares and loans, transferable securities and cash) exceeds 90% of their total balance sheet and €350,000 are liable to a minimum annual NWT of €4,815. Other companies are liable to a minimum progressive tax (in an amount up to €32,100), depending on the total assets on their balance sheet.

On November 10, 2023, the Luxembourg constitutional court held that the minimum net wealth tax of €4,815 is unconstitutional as other companies may be subject to a lower minimum net wealth tax depending on the total amount of their balance sheet. As a result of this decision, and pending legislative reform, Luxembourg companies that fall within the scope of the minimum net wealth tax of €4,815 will henceforth be subject to a minimum net wealth tax of €1,605 if the total amount of their balance sheet does not exceed €2,000,000.

**Withholding taxation**

Any dividend distributed by Codere Online to its shareholders will in principle be subject to a 15% withholding tax unless an exemption or a treaty reduction applies.

**Luxembourg taxation of the holders**

*Luxembourg tax residence of the holders*

Holders will not be deemed to be resident, domiciled or carrying on business in Luxembourg solely by reason of holding, execution, performance, delivery, exchange and/or enforcement of the Ordinary Shares and Codere Online Warrants.

*Taxation of Luxembourg non-residents*

Holders who are non-residents of Luxembourg and who do not have a permanent establishment, a permanent representative, or a fixed place of business in Luxembourg with which the holding of the Ordinary Shares and Codere Online Warrants is connected, are not liable to any Luxembourg income tax, whether they receive payments upon redemption or repurchase of the Ordinary Shares and Codere Online Warrants, or realize capital gains on the sale of any Ordinary Shares and Codere Online Warrants, unless they sell a participation of more than 10% in Codere Online within six months of its acquisition.

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*Taxation of Luxembourg residents*

Holders who are Luxembourg resident companies (*société de capitaux*) or foreign entities which have a permanent establishment or a permanent representative in Luxembourg with which the holding of the Ordinary Shares and Codere Online Warrants is connected, must include in their taxable income any income (including dividend) and the difference between the sale or redemption price and the lower of the cost or book value of the Ordinary Shares and Codere Online Warrants sold or redeemed.

Luxembourg resident corporate holders who are family wealth management companies subject to the law of May 11, 2007, undertakings for collective investment subject to the law of December 17, 2010, to the law of February 13, 2007, or to the law of July 23, 2016 on reserved alternative investment funds (provided it is not foreseen in the incorporation documents that (i) the exclusive object is the investment in risk capital and that (ii) article 48 of the aforementioned law of July 23, 2016 applies) are tax exempt entities in Luxembourg, and are thus not subject to any Luxembourg tax (*i.e.*, corporate income tax, municipal business tax and net wealth tax), other than the annual subscription tax calculated on their (paid up) share capital (and share premium) or net asset value.

*Net Wealth Tax*

Luxembourg net wealth tax will not be levied on the Ordinary Shares and Codere Online Warrants held by a corporate holder, unless: (i) such holder is a Luxembourg resident other than a holder governed by: (a) the laws of December 17, 2010 and February 13, 2007 on undertakings for collective investment; (b) the law of March 22, 2004 on securitization; (c) the law of June 15, 2004 on the investment company in risk capital; (d) the law of May 11, 2007 on family estate management companies; or (e) the law of July 23, 2016 on reserved alternative investment funds or (ii) such Ordinary Shares and Codere Online Warrants are attributable to an enterprise or part thereof which is carried on by a non-resident company in Luxembourg through a permanent establishment.

Luxembourg net wealth tax is levied at a 0.5% rate up to €500 million taxable base and at a 0.05% rate on the taxable base in excess of €500 million. Securitization vehicles, investment companies in risk capital (*Société d'investissement en capital à risque* (SICAR)), a regulated structure designed for private equity and venture capital investments (organized as tax opaque companies), and reserved alternative investment funds subject to the law of July 23, 2016 (provided it is foreseen in the incorporation documents that (i) the exclusive object is the investment in risk capital and that (ii) article 48 of the aforementioned law of July 23, 2016 applies), are subject to net wealth tax up to the amount of the minimum net wealth tax.

The minimum net wealth tax is levied on companies having their statutory seat or central administration in Luxembourg. For entities for which the sum of fixed financial assets, receivables against related companies, transferable securities and cash at bank exceeds 90% of their total gross assets and €350,000, the minimum net wealth tax is currently set at €4,815. For all other companies having their statutory seat or central administration in Luxembourg which do not fall within the scope of the €4,815 minimum net wealth tax, the minimum net wealth tax ranges from €535 to €32,100, depending on the company's total gross assets.

On November 10, 2023, the Luxembourg constitutional court held that the minimum net wealth tax of €4,815 is unconstitutional as other companies may be subject to a lower minimum net wealth tax depending on the total amount of their balance sheet. As a result of this decision, and pending legislative reform, Luxembourg companies that fall within the scope of the minimum net wealth tax of €4,815 will henceforth be subject to a minimum net wealth tax of €1,605 if the total amount of their balance sheet does not exceed €2,000,000.

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*Other Taxes*

No stamp, value, issue, registration, transfer or similar taxes or duties will be payable in Luxembourg as a consequence of a subsequent transfer, exchange or redemption of the Ordinary Shares and Codere Online Warrants, unless the documents relating to the Ordinary Shares and Codere Online Warrants are (i) voluntarily registered in Luxembourg or (ii) appended to a document that requires obligatory registration in Luxembourg.

There is no Luxembourg value added tax payable in respect of payments in consideration for the issuance of the Ordinary Shares and Codere Online Warrants or in respect of the payment under the Ordinary Shares and Codere Online Warrants or the transfer of the Ordinary Shares and Codere Online Warrants. Luxembourg value added tax may, however, be payable in respect of fees charged for certain services rendered to the Codere Online if, for Luxembourg value added tax purposes, such services are rendered or are deemed to be rendered in Luxembourg and an exemption from Luxembourg value added tax does not apply with respect to such services.

No Luxembourg inheritance tax is levied on the transfer of the Ordinary Shares and Codere Online Warrants upon the death of a holder in cases where the deceased was not a resident of Luxembourg for inheritance tax purposes. Where a holder is a resident of Luxembourg for tax purposes at the time of his death, the Ordinary Shares and Codere Online Warrants are included in his taxable estate for inheritance tax assessment purposes. No Luxembourg gift tax will be levied on the transfer of the Ordinary Shares and Codere Online Warrants.

**F.** **Dividends and paying agents** 

Not applicable.

**G.** **Statement by Experts** 

Not applicable.

**H.** **Documents on Display** 

The Company is subject to certain of the informational filing requirements of the Exchange Act. Since the Company is a "foreign private issuer", it is exempt from the rules and regulations under the Exchange Act prescribing the furnishing and content of proxy statements, and the officers, directors and principal shareholders of the Company are exempt from the reporting and "short-swing" profit recovery provisions contained in Section 16 of the Exchange Act with respect to their purchase and sale of Ordinary Shares. In addition, the Company is not required to file reports and financial statements with the SEC as frequently or as promptly as U.S. public companies whose securities are registered under the Exchange Act. However, the Company is required to file with the SEC an Annual Report on Form 20-F containing financial statements audited by an independent accounting firm. The SEC also maintains a website at http://www.sec.gov that contains reports and other information that the Company files with or furnishes electronically to the SEC. We also maintain a website at https://www.codereonline.com. Through our website, we make available, free of charge, the SEC filings. The information contained on, or that may be accessed through, our website is not part of, and is not incorporated into, this annual report.

**I.** **Subsidiary Information** 

Not applicable

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**Item 11. Quantitative and Qualitative Disclosures about Market Risks**

Codere Online is exposed to a variety of market and other risks, including the effects of changes in foreign currency exchange rates and liquidity, as well as credit risks and other risks and hazard events. For information about the effects of and how we manage such risks, see Item 5.E. "*Critical Accounting Policies and Estimates*."

**Item 12. Description of Securities Other Than Equity Securities**

**12. A. DEBT SECURITIES**

Not applicable.

**12. B. WARRANTS AND RIGHTS**

Not applicable.

**12. C. OTHER SECURITIES**

Not applicable.

**12. D. AMERICAN DEPOSITARY SHARES**

Not applicable.

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**PART II**

**Item 13. Defaults, Dividend Arrearages and Delinquencies**

None.

**Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds**

**Material Modifications to the Rights of Security Holders**

Codere Online's amended articles of association took effect on November 30, 2021 in connection with the Closing of the Business Combination. A copy of our articles of association is filed as Exhibit 1.1 to this annual report. See Item 10.B. *"Memorandum and Articles of Association."*

**Use of Proceeds**

None.

**Item 15. Controls and Procedures**

***Disclosure Controls and Procedures***

As of December 31, 2024, we maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). These are designed to ensure that information required to be disclosed in the Company's reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Codere Online's senior management, including Codere Online's Chief Executive Officer and Chief Financial Officer, performed an evaluation of the effectiveness of the design and implementation of Codere Online's disclosure controls and procedures. Based on such evaluation, Codere Online's senior management, including the Chief Executive Officer and Chief Financial Officer, have concluded that as of December 31, 2024, Codere Online did not maintain effective disclosure controls and procedures.

In light of the material weakness discussed below, the Company has performed additional analysis and procedures to ensure that our annual consolidated financial statements are prepared in accordance with IFRS. Our management, including our Chief Executive Officer and our Chief Financial Officer, has concluded that our consolidated financial statements for the periods covered by and included in this Annual Report on Form 20-F are fairly presented, in all material respects, in accordance with IFRS for the periods presented herein.

***Management's Annual Report on Internal Control over Financial Reporting***

Codere Online's senior management, including Codere Online's Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Codere Online's internal control over financial reporting is a process designed by, or under the supervision of, the Chief Executive Officer and Chief Financial Officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Codere Online's consolidated financial statements for external reporting purposes in accordance with IFRS.

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Codere Online's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Codere Online; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of Codere Online are being made only in accordance with authorizations of management and directors of Codere Online; and (iii) provide reasonable assurance regarding prevention or timely detection of the unauthorized acquisition, use, or disposition of Codere Online's assets that could have a material effect on the financial statements of Codere Online.

Codere Online's senior management, including Codere Online's Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of Codere Online's internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("**COSO**").

Three of the previously reported material weaknesses, which were identified in connection with the preparation of our financial statements as of and for the years ended December 31, 2022 and December 31, 2023 were remediated as of December 31, 2023.

As of December 31, 2024, Codere Online's senior management, under the supervision of Codere Online's Chief Executive Officer and Chief Financial Officer, cannot affirmatively conclude that the Fourth Material Weakness related to the lack of sufficient internal controls to support financial reporting has been remediated. As a consequence, Codere Online did not maintain effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria described above.

*Remediation actions taken*

During 2024, Codere Online's senior management continued actions to remediate the Codere Online Fourth Material Weakness. While certain remedial actions have been completed, Codere Online continues to actively plan for and implement additional control procedures.

To address the Fourth Material Weakness, during 2024, the Company undertook a comprehensive remediation plan aimed at strengthening the internal control environment and improving financial reporting processes. Key initiatives included the design and implementation of new critical controls, enhanced documentation and evidence practices, and increased engagement from process and control owners through training and ongoing support.

Additionally, a rationalization of the Company´s control matrix was undertaken, consolidating local controls into global controls and introducing new controls where necessary. Codere Online´s Internal Controls function was further restructured, to facilitate greater ownership and accelerate implementation by operational teams.

Codere Online's management will periodically assess the progress and sufficiency of the ongoing initiatives and make adjustments as and when necessary. Codere Online's management understands that the improvement and maintenance of internal controls is an ongoing responsibility.

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Measures adopted by Codere Online to enhance its internal control over financial reporting may not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that its objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected. Any failure to maintain effective disclosure controls and procedures and internal control over financial reporting could have a material adverse effect on Codere Online's business, financial condition and results of operations and could cause the price of the Ordinary Shares and Codere Online Warrants to decline.

***Attestation Report of the Registered Public Accounting Firm***

This annual report does not include an attestation report of Codere Online's independent registered public accounting firm. Codere Online's independent registered public accounting firm will not be required to opine on the effectiveness of Codere Online's internal control over financial reporting until after it is no longer an "emerging growth company" as defined in the JOBS Act.

***Changes in Internal Control over Financial Reporting***

Other than as described above, there has been no change in our internal control over financial reporting during the year ended December 31, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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**Item 16. [Reserved]**

**Item 16A. Audit Committee Financial Expert**

The Codere Online Board has determined that Borja Fernandez and Daniel Valdez each qualify as an audit committee financial expert as defined in Item 16A of Form 20-F and that Mr. Fernandez and Mr. Valdez are each also "independent," as defined in Rule 10A-3(b)(1) under the Exchange Act and applicable Nasdaq standards. For more information about Mr. Fernandez and Mr. Valdez, see Item 6.A. *"Directors and Senior Management."*

**Item 16B. Code of Ethics**

Codere Online's Code of Ethics and Integrity is applicable to Codere Online's directors and senior management and complies with the rules and regulations of Nasdaq and the SEC. Codere Online's Code of Ethics is accessible through its corporate website. In addition, Codere Online will post on the Corporate Governance section of its website all disclosures that are required by law or Nasdaq listing standards concerning any amendments to, or waivers from, any provision of the Code of Ethics and Integrity. The reference to Codere Online's website address in this annual report does not include or incorporate by reference the information on Codere Online's website into this annual report.

**Item 16C. Principal Accountant Fees and Services**

MaloneBailey LLP ("MaloneBailey") acted as Codere Online's independent auditor for the years ended December 31, 2024 and 2023. The table below sets out the total expenses incurred by Codere Online from MaloneBailey for services performed for the year ended December 31, 2024 and from MaloneBailey and Marcum LLP ("Marcum") for services performed for the year ended December 31, 2023 in thousands of euros, and breaks down these amounts by category of service.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** | **(in thousands of euros)** |
| Audit fees<sup>(1)</sup> | € | 900 | € | 2015 |
| Tax fees |  | - |  | 3 |
| **Total** | **€** | **900** | **€** | **2018** |

---

(1) "Audit fees" in 2023 include (i) fees incurred with Marcum related to their audit work for the years ended December 31, 2023, 2022, and 2021, including opening balance for the latter and (ii) fees incurred with MaloneBailey related to their audit work for the year ended December 31, 2023.

***Pre-Approval Policies and Procedures***

The advance approval of the Audit Committee or members thereof, to whom approval authority has been delegated, is required for all audit and non-audit services provided by our auditors.

All services provided by our auditors are approved in advance by either the Audit Committee or members thereof, to whom authority has been delegated, in accordance with the Audit Committee's pre-approval policy. No such services were approved pursuant to the procedures described in Rule 2-01(c)(7)(i)(C) of Regulation S-X, which waives the general requirement for pre-approval in certain circumstances.

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**Item 16D. Exemptions from the Listing Standards for Audit Committees**

Not applicable.

**Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers**

At a general meeting held on March 3, 2025, Codere Online shareholders authorized the repurchase of up to 1 million of the Company's ordinary shares over a one-year period. As of May 28, 2025, Codere Online had repurchased 77,005 shares at an average price of $6.67 under the authorized share buyback plan.

**Item 16F. Change in Registrant's Certifying Accountant**

***Newly Appointed Independent Registered Public Accounting Firm***

On December 31, 2024, the Company engaged MaloneBailey as the Company's independent registered public accounting firm for the Company's fiscal years ended December 31, 2023, and December 31, 2024. The decision to engage MaloneBailey was approved by the Company's Audit Committee and its Board of Directors.

During the three years ended December 31, 2021, December 31, 2022, December 31, 2023, and during the interim period through the date of our engagement of MaloneBailey, we did not consult with MaloneBailey on items regarding (1) the application of accounting principles to any specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company's financial statements, nor did MaloneBailey provide a written report or oral advice to the Company that MaloneBailey concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue; or (2) any matter that was either the subject of a disagreement (as defined in Item 16F(a)(1)(iv) and the related instructions to Item 16F of Form 20-F) or a reportable event (as described in Item 16F(a)(1)(v)).

**Item 16G. Corporate Governance**

**Foreign Private Issuer Exemption**

As a "foreign private issuer," as defined by the SEC, Codere Online is permitted to follow, and does follow, certain home country corporate governance practices, instead of certain corporate governance practices required by Nasdaq for U.S. domestic issuers. Codere Online's corporate governance practices differ in certain respects from those that U.S. domestic issuers must adopt in order to maintain a Nasdaq listing. A brief, general summary of the certain home country corporate governance practices Codere Online has opted to follow in lieu of certain Nasdaq Listing Rules is provided below:

● Unlike Nasdaq Listing Rules, Luxembourg law and the articles of association of Codere Online do not require that the compensation of Codere Online's senior management team be determined, or recommended to the Codere Online Board for determination, by a compensation committee comprised of independent directors. Codere Online follows Luxembourg law and its articles of association with regard to compensation of its senior management and has opted not to establish a compensation committee. Codere Online currently believes that matters in connection with compensation of Codere Online's senior management should be discussed and determined by the entire Codere Online Board, and where relevant, be subject to the approval of the general meeting of shareholders of Codere Online.

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● Unlike Nasdaq Listing Rules, Luxembourg law and the articles of association of Codere Online do not require director nominations to be made by a nominations committee comprised of independent directors or by independent directors constituting a majority of the Codere Online Board's independent directors. Codere Online follows Luxembourg law, its articles of association and the Nomination Agreement with regard to the process of nominating directors. Pursuant to the Nomination Agreement, Codere Newco has the right to propose certain directors for appointment by the Codere Online Shareholders. Moreover, directors may also be recommended by the Codere Online Board for appointment by Codere Online Shareholders (other than directors appointed by the Codere Online Board to fill a vacancy). Finally, Codere Online Shareholders holding at least 10% of the Ordinary Shares of Codere Online may propose certain directors for appointment by the Codere Online Shareholders.

● Nasdaq Listing Rules require that a listed company that is not a limited partnership shall solicit proxies and provide proxy statements for all meetings of shareholders, and also provide copies of such proxy solicitation materials to Nasdaq. Codere Online is a "foreign private issuer" as defined by the SEC, and the equity securities of Codere Online are accordingly exempt from the proxy rules set forth in the Exchange Act. Additionally, Codere Online is not required to solicit proxies in accordance with applicable rules and regulations in Luxembourg.

● Codere Online follows Luxembourg practice with respect to quorum requirements for shareholder meetings in lieu of the requirement under Nasdaq Listing Rules that the quorum be not less than 33⅓% of the outstanding voting shares. Under the articles of association of Codere Online and the 1915 Law, lower thresholds are mandatorily required for certain meetings of Codere Online Shareholders. In addition, under the articles of association of Codere Online, there is no quorum requirement for resolutions to be considered at certain extraordinary general meetings of Codere Online Shareholders. Except where lower thresholds are mandatorily required by the 1915 Law or Luxembourg law for certain meetings of Codere Online Shareholders, under the articles of association of Codere Online quorum for ordinary general meetings of Codere Online Shareholders is the presence or representation of 33⅓% of the outstanding voting shares. For extraordinary general meetings of Codere Online Shareholders, the quorum is the presence or representation of at least 50% of the outstanding voting shares, being understood that if such quorum is not reached, a second meeting can be convened at which no quorum requirement shall apply.

● Nasdaq Listing Rule 5635 requires shareholder approval in connection with, among other things, (A) the issuance of securities in connection with an acquisition of the stock or assets of another company if (i) the issuance will result in the issuance of 20% or more of the voting power or number of shares of common equity outstanding prior to the proposed issuance or (ii) certain affiliates have a 5% interest (or 10% interest on a collective basis) in the company or assets proposed to be acquired, (B) an issuance of securities results in a change of control of Codere Online, (C) the issuance of securities in connection with a new or materially amended equity compensation plan and (D) certain private offerings of 20% or more of Codere Online's common equity outstanding prior to the offering at a price below the Minimum Price (as defined in Nasdaq Listing Rule 5635(d)). Codere Online has chosen to follow Luxembourg law applicable to it with respect to shareholder approval in connection with issuance of securities in lieu of following Nasdaq Listing Rule 5635. Under Luxembourg law, the issuance of securities in the contexts described above normally require shareholder approval but it is permitted to authorize the board to proceed to such issuances under certain conditions. Thus, under the articles of association of Codere Online do not require that shareholder approval be obtained in connection with certain dilutive events. Under the articles of association of Codere Online and the 1915 Law, the Codere Online Board is authorized to issue new Ordinary Shares for an amount not to exceed the amount of authorized, but unissued and unsubscribed share capital of Codere Online and to allot existing or newly issued Ordinary Shares to certain persons, including employees of Codere Online, without shareholder approval, as set forth under the articles of association of Codere Online.

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**Controlled Company**

For purposes of the rules of the Nasdaq, Codere Online is a "controlled company." Under the Nasdaq rules, controlled companies are companies of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company. Codere Newco owns approximately 65.7% of the outstanding Ordinary Shares as of March 31, 2025. Accordingly, Codere Online is eligible and may in the future decide to take advantage of exemptions from certain Nasdaq corporate governance standards applicable to controlled companies.

**Item 16H. Mine Safety Disclosure**

Not applicable.

**Item 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections**

Not applicable.

**Item 16J. INSIDER TRADING POLICIES**

In connection with the consummation of the Business Combination, Codere Online adopted an Insider Trading Policy that, among other things, governs the purchase, sale and other disposition of Codere Online's securities by its directors, executive officers, senior management and employees. Codere Online believes the Insider Trading Policy is reasonably designed to promote compliance with applicable insider trading laws, rules and regulations and applicable Nasdaq requirements. A copy of Codere Online's Insider Trading Policy, as amended to date, is filed as Exhibit 11.1 to this annual report.

**Item 16K. CYBERSECURITY.**

***Risk Management and Strategy***.

Codere Online has developed an information security program to assess, identify, and manage material risks from cybersecurity threats. This program is integrated into our overall enterprise risk management system ("ERM") as a key risk. If the ERM process identifies a heightened cybersecurity risk, the appropriate team is tasked with developing risk mitigation strategies and plans, which are monitored to completion.

Codere Online relies on its parent company, Codere Group, to provide services including, among other things, technical assistance and technology, IT operations, security and cybersecurity, and systems, pursuant to the New Platform and Technology Services Agreement. Codere Apuestas Espana, S.L.U. has obtained an ISO/IEC 27001:2013 certification, which expires on October 31, 2025, for the information systems that provide support to the provision of land-based fixed-odds betting services and online gaming services to other entities of the Codere Group. The certification was obtained from an independent, external consultant. Codere Group maintains a cyber incident management procedure which defines how it would support Codere Online in the event of an incident. In addition, Codere Group utilizes the assistance of third-party consultants in connection with its information security program to help identify threats and define strategies for addressing same. Codere Online may also hire such third-party consultants on an *ad hoc* basis, as necessary.

Codere Group has an Information Security and Technology Risk Management Team (ISTRM Team) that supports Codere Online in addressing information technology risks, including cybersecurity risks. Codere Online's information security program includes policies and procedures designed to identify how information security measures and controls are developed, implemented, and maintained, including an Information Security Policy, Acceptable Use of Information Assets Policy, and Business Continuity Management Policy. An internal cybersecurity risk assessment is conducted annually by Codere Group which includes risks to Codere Online and is used by management to consider implementing and augmenting cybersecurity controls where feasible and appropriate to mitigate cybersecurity risk exposure.

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Codere Online utilizes multiple training methodologies to ensure employee awareness of cybersecurity risks and practices. Employees receive information from security awareness campaigns. Training also includes email phishing campaigns which can prompt further training depending on the results. Codere Online has a written Personal Data Breach Management Procedure which identifies a cross-functional Computer Security Incident Response Team (CSIRT Team) to address potential cybersecurity incidents.

Codere Online engages with a number of service providers in connection with normal business operations. Codere Online uses various processes to address cybersecurity threats related to third-party service providers, including, where appropriate, pre-acquisition diligence questionnaires, imposition of contractual data security and privacy obligations, and ad hoc monitoring activities.

Although from time to time, Codere Online experiences cyber incidents, Codere Online is not aware of any risks from cybersecurity threats that have materially affected, or are reasonably likely to materially affect Codere Online, including strategies, results of operations, or financial condition. There can be no guarantee that (i) our policies and procedures will be properly followed in every instance or that those policies and procedures will be effective or (ii) that there will not be incidents in the future or that they will not materially affect us, including our strategy, results of operations, or financial condition.

For more information about cybersecurity risks, see the risk factor titled "*Codere Online's network, information technology systems and accounting systems are subject to error, damage and interruption and are vulnerable to hacker intrusion, cyberattacks and system breaches"* in Item 3.D of this annual report.

***Governance***

Cybersecurity is important to our risk management processes. As mentioned above, the ISTRM Team oversees and addresses risks from cybersecurity threats. Imminent threats are handled by the CSIRT Team. These individuals are informed about, and monitor the prevention, mitigation, detection, and remediation of cybersecurity incidents through their management of, and participation in, the cybersecurity risk management and strategy processes described above, including the operation of our incident response plan. The incident response plan provides for notification to management, the data protection team and, where applicable, the Board of Directors, as appropriate, of any actual or suspected significant cybersecurity incidents and requires regular updates to these parties during an investigation. Members of the ISTRM team and the Director of IT Service Management meet periodically, but at least quarterly, with Codere Online senior executives, including the Chief Information Security Officer, to review Codere Online's internal process, policies, and practices, for assessing and managing material risks from cybersecurity threats.

The Audit Committee has oversight responsibility for risks and incidents relating to cybersecurity threats. The Audit Committee receives reports from management about the prevention, detection, mitigation, and remediation of cybersecurity risks. The Audit Committee reports to the full board periodically, and at least annually, on its review of cybersecurity controls, policies, practices and risks. Effective in 2024, as part of the Audit Committee's quarterly meetings with management, the Audit Committee will receive briefings from the Director of IT Service Management and, where appropriate, other individuals with responsibility for cybersecurity, to discuss cybersecurity risks and threats. The Audit Committee will review important trends and developments in cybersecurity risks, information security controls and proposed controls, and related legal requirements and their effect on Codere Online.

Oversight of the Information Security Policy and the Acceptable Use of Information Assets Policy is handled by Information Security Management, which is led by the Director of IT Service Management. The Director of IT Service Management at Codere Online has more than 25 years of experience in consulting and IT services and is experienced with the assessment, definition, and implementation of IT processes and metrics, and adaptation and application of frameworks and standards, balanced score cards, and audits. The Director of IT Service Management is supported by the Director of Information Security and Technology Risk – Chief Information Security Officer at Codere Group. She has more than 24 years of experience as head of cybersecurity in large organizations in the financial and telecommunications sector, where she has been responsible for the design and implementation of information security and IT services.

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**PART III**

**Item 17. Financial Statements**

See Item 18 "Financial Statements."

**Item 18. Financial Statements**

Please refer to pages F-1 through F-55 of this annual report.

**Item 19. Exhibits**

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| | |
|:---|:---|
| **Exhibit Number** | **Description** |
| 1.1 | [Consolidated Articles of Association of Codere Online Luxembourg, S.A., dated as of November 30, 2021 (incorporated by reference to Exhibit 3.1 to Codere Online Luxembourg, S.A.'s Form F-1, File No. 333-262940, filed with the SEC on February 24, 2022).](https://www.sec.gov/Archives/edgar/data/1866782/000182912622004310/codereonline_ex3-1.htm) |
| 2.1\* | [Description of Securities.](codereonline_ex2-1.htm) |
| 2.2 | [Specimen Ordinary Share Certificate of Codere Online Luxembourg, S.A. (incorporated by reference to Exhibit 4.1 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on August 12, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621011681/codereonline_ex4-1.htm) |
| 2.3 | [Warrant Agreement, dated December 7, 2020, by and between DD3 Acquisition Corp. II, and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 4.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on December 11, 2020).](https://www.sec.gov/Archives/edgar/data/1828957/000182912620000327/dd3acqcorpii_ex4-1.htm) |
| 2.4 | [Form of Assignment, Assumption and Amendment Agreement by and among DD3 Acquisition Corp. II, Codere Online Luxembourg, S.A. and Continental Stock Transfer & Trust Company, with respect to the Warrant Agreement dated as of December 7, 2020 (incorporated by reference to Exhibit F of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 2.5 | [Form of Warrant Certificate of Codere Online Luxembourg, S.A. (incorporated by reference to Exhibit A to Exhibit F of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.1# | [Business Combination Agreement, dated as of June 21, 2021, by and among DD3 Acquisition Corp. II, Codere Newco, S.A.U., Servicios de Juego Online S.A.U., Codere Online Luxembourg, S.A. and Codere Online U.S. Corp. (incorporated by reference to Exhibit 2.1 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on August 12, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621007960/codereonline_f4.htm#T39) |
| 4.2 | [Contribution and Exchange Agreement, dated as of June 21, 2021, by and among Codere Online Luxembourg, S.A., Servicios de Juego Online, S.A.U. and Codere Newco, S.A.U. (incorporated by reference to Exhibit 10.2 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex10-2.htm) |
| 4.3 | [Investor Support Agreement, dated as of June 21, 2021, by and among DD3 Acquisition Corp. II, Baron Global Advantage Fund, Baron Emerging Markets Fund and Destinations International Equity Fund (incorporated by reference to Exhibit 10.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex10-1.htm) |
| 4.4 | [Form of Subscription Agreement (incorporated by reference to Exhibit 10.3 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex10-3.htm) |

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| 4.5 | [Forward Purchase Agreement, dated as of November 17, 2020, by and among DD3 Acquisition Corp. II, Baron Global Advantage Fund, Baron Emerging Markets Fund and Destinations International Equity Fund (incorporated by reference to Exhibit 10.5 to DD3 Acquisition Corp. II's Registration Statement on Form S-1 (File No. 333-250212), filed with the SEC on November 19, 2020).](https://www.sec.gov/Archives/edgar/data/1828957/000182912620000154/dd3acqcorpii_ex10-5.htm) |
| 4.6 | [Forward Purchase Agreement, dated as of November 19, 2020, by and between DD3 Acquisition Corp. II and MG Partners Multi-Strategy Fund LP (incorporated by reference to Exhibit 10.12 to DD3 Acquisition Corp. II's Registration Statement on Form S-1 (File No. 333-250212), filed with the SEC on November 19, 2020).](https://www.sec.gov/Archives/edgar/data/1828957/000182912620000154/dd3acqcorpii_ex10-12.htm) |
| 4.7 | [Amendment No. 1 to Forward Purchase Agreement, dated as of June 21, 2021, by and among DD3 Acquisition Corp. II, Baron Global Advantage Fund, Baron Emerging Markets Fund and Destinations International Equity Fund (incorporated by reference to Exhibit 10.6 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex10-6.htm) |
| 4.8 | [Amendment No. 1 to Forward Purchase Agreement, dated as of June 21, 2021, by and between DD3 Acquisition Corp. II and MG Partners Multi-Strategy Fund LP (incorporated by reference to Exhibit 10.7 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex10-7.htm) |
| 4.9 | [Form of Registration Rights and Lock-Up Agreement, by and among Codere Online Luxembourg, S.A., DD3 Sponsor Group, LLC, MG Partners Multi-Strategy Fund LP, Baron Global Advantage Fund, Baron Emerging Markets Fund, Destinations International Equity Fund, Codere Newco, S.A.U. and DD3 Acquisition Corp. II (incorporated by reference to Exhibit A of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.10 | [Form of Nomination Agreement, by and among Codere Online Luxembourg, S.A., DD3 Sponsor Group, LLC and Codere Newco, S.A.U. (incorporated by reference to Exhibit B of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.11 | [Form of Indemnification Letter, by and among DD3 Acquisition Corp. II, Codere Newco, S.A.U., Servicios de Juego Online, S.A.U., Codere Online Luxembourg, S.A. and Codere Online U.S. Corp. (incorporated by reference to Exhibit C of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.12 | [Form of Redemption Agreement for Codere Ordinary Shares by and between Codere Online Luxembourg, S.A. and Codere Newco, S.A.U. (incorporated by reference to Exhibit G of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.13 | [Form of Expenses Reimbursement Letter by and among DD3 Acquisition Corp. II, Codere Newco, S.A.U., Servicios de Juego Online, S.A.U., Codere Online Luxembourg, S.A. and Codere Online U.S. Corp. (incorporated by reference to Exhibit H of Exhibit 2.1 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on June 22, 2021).](https://www.sec.gov/Archives/edgar/data/1828957/000182912621005376/dd3acquisitioncorp2_ex2-1.htm) |
| 4.14 | [Relationship and License Agreement, dated June 21, 2021, by and between Servicios de Juego Online S.A.U and Codere Newco, S.A.U. (incorporated by reference to Exhibit 10.13 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on October 8, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621007960/codereonline_ex10-13.htm) |
| 4.15# | [Sponsorship and Services Agreement, dated June 21, 2021, by and between Servicios de Juego Online S.A.U. and Codere Newco, S.A.U. (incorporated by reference to Exhibit 10.14 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on October 8, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621007960/codereonline_ex10-14.htm) |

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| | |
|:---|:---|
| 4.16# | [New Platform and Technology Services Agreement, made and entered into as of October 8, 2024, effective from January 1, 2023, by and between Codere Online S.A.U., Servicios de Juego Online, S.A.U., Codere Apuestas Espana S.L.U. and Codere Newco S.A.U. (incorporated by reference to Exhibit 4.16 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex4-16.htm) |
| 4.17 | [English translation of agreement, dated June 21, 2021, by and between Libros Foráneos, S.A. de C.V. and Servicios de Juego Online S.A.U. with respect to the online gaming business in Mexico (incorporated by reference to Exhibit 10.16 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on October 8, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621011681/codereonline_ex10-16.htm) |
| 4.18 | [English translation of the amendment, effective as of August 2, 2023, to the agreement dated June 21, 2021 by and between Libros Foráneos, S.A. de C.V. and Servicios de Juego Online S.A.U. with respect to the online gaming business in Mexico (incorporated by reference to Exhibit 4.18 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex4-18.htm) |
| 4.19 | [Internal Affiliate Program Master Agreement, dated March 12, 2021, by and between Servicios de Juego Online S.A.U. and Codere Newco, S.A.U. (incorporated by reference to Exhibit 10.17 to Codere Online Luxembourg, S.A.'s Form F-4, File No. 333-258759, filed with the SEC on October 8, 2021).](https://www.sec.gov/Archives/edgar/data/1866782/000182912621007960/codereonline_ex10-17.htm) |
| 4.20# | [Amendment No.1 to the Internal Affiliate Program Agreement, dated as of June 30, 2023, by and between Servicios de Juego Online S.A.U. and Codere Newco, S.A.U (incorporated by reference to Exhibit 4.20 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex4-20.htm) |
| 4.21# | [Executive Vice Chairman Supplemental Bonus Agreement, effective as of May 7, 2024, between Servicios de Juego Online, S.A. Codere Israel Marketing Support Services Ltd., Codere Newco, S.A.U. and Moshe Edree (incorporated by reference to Exhibit 4.21 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex4-21.htm) |
| 4.22 | [Investment Management Trust Agreement, dated December 7, 2020, by and between DD3 Acquisition Corp. II and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.2 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on December 11, 2020).](https://www.sec.gov/Archives/edgar/data/1828957/000182912620000327/dd3acqcorpii_ex10-2.htm) |
| 4.23 | [Stock Escrow Agreement, dated December 7, 2020, by and among DD3 Acquisition Corp. II, Continental Stock Transfer & Trust Company and certain securityholders (incorporated by reference to Exhibit 10.4 to DD3 Acquisition Corp. II's Form 8-K (File No. 001-39767), filed with the SEC on December 11, 2020).](https://www.sec.gov/Archives/edgar/data/1828957/000182912620000327/dd3acqcorpii_ex10-4.htm) |
| 4.24† | [Long-term Incentive Plan Master Agreement (incorporated by reference to Exhibit 4.25 to Codere Online Luxembourg, S.A.'s Annual Report on Form 20-F filed with the SEC on April 29, 2022).](https://www.sec.gov/Archives/edgar/data/1866782/000182912622009210/codereonline_ex4-25.htm) |
| 4.25\* | [Waiver to the Relationship and License Agreement, effective as of May 1, 2025, between Codere Online Luxembourg, S.A., Servicios de Juego Online, S.A.U. and Codere Newco, S.A.U.](codereonline_ex4-25.htm) |
| 8.1\* | [List of Subsidiaries of Codere Online Luxembourg, S.A.](codereonline_ex8-1.htm) |
| 11.1 | [Codere Online Luxembourg, S.A. Insider Trading Policy (incorporated by reference to Exhibit 11.1 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex11-1.htm) |
| 12.1\* | [Principal Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](codereonline_ex12-1.htm) |
| 12.2\* | [Principal Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](codereonline_ex12-2.htm) |
| 13.1\* | [Principal Executive Officer Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](codereonline_ex13-1.htm) |

---

[**Table of Contents**](#toc)

---

| | |
|:---|:---|
| 13.2\* | [Principal Financial Officer Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](codereonline_ex13-2.htm) |
| 97.1 | [Codere Online Luxembourg, S.A. Clawback Policy (incorporated by reference to Exhibit 97.1 to Codere Online Luxembourg S.A.'s Form 20-F for the year ended December 31, 2023).](https://www.sec.gov/Archives/edgar/data/1866782/000182912625003270/codereonline_ex97-1.htm) |
| 101.INS\* | Inline XBRL Instance Document. |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Documents. |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document. |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
| 104\* | Cover Page Interactive Data File (embedded within Inline XBRL document) |

---

\* Filed herewith. <br> # Certain schedules, annexes and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K, but will be furnished supplementally to the SEC upon request. <br> † Indicates a management contract or compensatory plan.

[**Table of Contents**](#toc)

**SIGNATURES**

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

---

| | | | |
|:---|:---|:---|:---|
|  | **Codere Online Luxembourg, S.A.** | **Codere Online Luxembourg, S.A.** | **Codere Online Luxembourg, S.A.** |
| Date: June 2, 2025 | By: | /s/ Aviv Sher | /s/ Aviv Sher |
|  |  | Name: | Aviv Sher |
|  |  | Title: | Chief Executive Officer |
| Date: June 2, 2025 | By: | /s/ Oscar Iglesias | /s/ Oscar Iglesias |
|  |  | Name: | Oscar Iglesias |
|  |  | Title: | Chief Financial Officer |

---

[**Table of Contents**](#toc)

**INDEX TO FINANCIAL INFORMATION**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm (PCAOB ID: 206)](#f1_001) | F-2 |
| [Consolidated Statements of Financial Position as of December 31, 2024 and 2023](#f1_002) | F-3 |
| [Consolidated Statements of Operations for the years ended December 31, 2024 and 2023 and Consolidated Carve-Out Income Statement for the year ended December 31, 2022](#f1_003) | F-4 |
| [Consolidated Statements of Comprehensive Income for the years ended December 31, 2024 and 2023 and Consolidated Carve-Out Statement of Comprehensive Income for the year ended December 31, 2022](#f1_004) | F-5 |
| [Consolidated Statements of Changes in Equity for the years ended December 31, 2024 and 2023 and Consolidated Carve-Out Statement of Changes in Equity for the year ended December 31, 2022](#f1_005) | F-6 |
| [Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 and Carve-Out Statement of Cash Flows for the year ended December 31, 2022](#f1_006) | F-7 |
| [Notes to Consolidated Financial Statements](#f1_007) | F-8 – F-55 |
| [Report of Independent Registered Public Accounting Firm](#f2_001) | F-56 |
| [Consolidated Statement of Financial Position as of December 31, 2022, and Consolidated Carve-out Statement of Financial Position as of December 31, 2021](#f2_002) | F-57 |
| [Consolidated Carve-out Income Statements for the Years Ended December 31, 2022 and 2021, and Consolidated Combined Carve-out Income Statement for the Year Ended December 31, 2020](#f2_003) | F-58 |
| [Consolidated Carve-out Statement of Comprehensive Income for the Years Ended December 31, 2022 and 2021, and Consolidated Combined Carve-out Statement of Comprehensive Income for the Year Ended December 31, 2020](#f2_004) | F-59 |
| [Consolidated Carve-out Statement of Changes in Equity for the Years Ended December 31, 2022 and 2021, and Consolidated Combined Carve-out Statement of Changes in Equity for the Year Ended December 31, 2020](#f2_005) | F-60 |
| [Consolidated Carve-out Statement of Cash Flows for the Years Ended December 31, 2022 and 2021, and Consolidated Combined Carve-out Statement of Cash Flows for the Year ended December 31, 2020](#f2_006) | F-62 |
| [Notes to Financial Statements](#f2_007) | F-63 – F-120 |

---

[**Table of Contents**](#toc)

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Shareholders and Board of Directors of

Codere Online Luxembourg, S.A.

***Opinion on the Financial Statements***

We have audited the accompanying consolidated statements of financial position of Codere Online Luxembourg, S.A. and its subsidiaries (collectively, the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations, comprehensive income, changes in equity, and cash flows for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of their operations and their cash flows for the years then ended, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

The consolidated carve-out financial statements of the Company as of December 31, 2022 were audited by other auditors whose report dated April 28, 2023, expressed an unqualified opinion on those statements.

***Basis for Opinion***

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

*/s/ MaloneBailey, LLP*

<u>www.malonebailey.com</u>

We have served as the Company's auditor since 2024.

Houston, Texas

June 2, 2025

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF FINANCIAL POSITION**

**AS OF DECEMBER 31 2024 AND 2023**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **Notes** | **12/31/2024** | **12/31/2023** |
| **ASSETS** |  |  |  |
| **A) NON-CURRENT ASSETS** |  | **11617** | **8519** |
| Intangible assets | 5 |  | 10 |
| Property, plant and equipment | 6 | 453 | 331 |
| Right-of-use assets | 7 | 1957 |  |
| Deferred tax assets | 13 | 9207 | 8178 |
| **B) CURRENT ASSETS** |  | **62923** | **65280** |
| Trade receivables and other current assets | 9 | 9122 | 13604 |
| Current financial assets | 8 | 13494 | 10398 |
| Cash and cash equivalents | 8 | 40307 | 41278 |
| **TOTAL ASSETS (A+B)** |  | **74540** | **73799** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Notes** | **12/31/2024** | **12/31/2023** |
| **EQUITY AND LIABILITIES** |  |  |  |
| **A) EQUITY** | **10** | **24220** | **21286** |
| Equity attributable to equity holders of the Company |  | 24071 | 21139 |
| Equity attributable to non-controlling interest |  | 149 | 147 |
| **B) NON-CURRENT LIABILITIES** |  | **5358** | **408** |
| Non-current lease obligations | 7 | 1638 |  |
| Non-current financial liabilities | 11 | 3720 | 408 |
| **C) CURRENT LIABILITIES** |  | **44962** | **52105** |
| Lease obligations | 7 | 364 |  |
| Borrowings | 11 | 3365 | 5105 |
| Trade payables and other current liabilities | 12 | 41233 | 47000 |
| **TOTAL EQUITY AND LIABILITIES (A+B+C)** |  | **74540** | **73799** |

---

The accompanying notes 1 to 19 are an integral part of the consolidated financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 AND**

**CONSOLIDATED CARVE-OUT INCOME STATEMENT**

**FOR THE YEAR ENDED DECEMBER 31, 2022**

**(Thousands of Euros)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Notes** | **2024** | **2023** | **2022** |
| **Revenue** | **14** | **200704** | **161647** | **115747** |
| Personnel expenses | 14 | (18784) | (17437) | (15301) |
| Depreciation and amortization | 14 | (388) | (114) | (556) |
| Other operating expenses | 14 | (177201) | (158850) | (155765) |
| **Operating expenses** |  | **(196373)** | **(176401)** | **(171622)** |
| **OPERATING INCOME/(LOSS)** |  | **4331** | **(14754)** | **(55875)** |
| Finance income / (costs) | 14 | 1041 | 5826 | 12460 |
| **Net finance income** |  | **1041** | **5826** | **12460** |
| **NET INCOME/(LOSS) BEFORE TAX** |  | **5372** | **(8928)** | **(43415)** |
| Income tax benefit/(expense) | 13 | (1462) | 6513 | (2968) |
| **NET INCOME/(LOSS) FOR THE YEAR** |  | **3910** | **(2415)** | **(46383)** |
| Attributable to equity holders of the Company |  | 3908 | (2417) | (46382) |
| Attributable to non-controlling interests |  | 2 | 2 | (1) |
| Basic earnings per share attributable to equity holders of the parent (Euro) | 14 | 0.09 | (0.05) | (1.03) |
| Diluted earnings per share attributable to equity holders of the parent (Euro) | 14 | 0.08 | (0.05) | (1.03) |

---

The accompanying notes 1 to 19 are an integral part of the consolidated financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME**

**FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 AND**

**CONSOLIDATED CARVE-OUT STATEMENT OF COMPREHENSIVE INCOME**

**FOR THE YEAR ENDED DECEMBER 31, 2022**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| **Net income / (loss) for the year** | **3910** | **(2415)** | **(46383)** |
| Currency translation differences | (2834) | (3402) | (1470) |
| Income tax impact | - | - | - |
| **Items that may be reclassified subsequently to profit or loss** | **(2834)** | **(3402)** | **(1470)** |
| **Total other comprehensive income/(loss) recognized in the year** | **(2834)** | **(3402)** | **(1470)** |
| **Total comprehensive income / (loss) recognized in the year** | **1076** | **(5817)** | **(47853)** |
| **Attributable to:** |  |  |  |
| Equity holders of the Company | 1074 | (5819) | (47852) |
| Non-controlling interests | 2 | 2 | (1) |

---

The accompanying notes 1 to 19 are an integral part of the consolidated financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY**

**FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 AND**

**CONSOLIDATED CARVE-OUT STATEMENT OF CHANGES IN EQUITY**

**FOR THE YEAR ENDED DECEMBER 31, 2022**

**(Thousands of Euros)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Company (Codere Online Luxembourg S.A.)** | | |
|  | **Issued capital** | **Other reserves** | **Share premium** | **Net income / (loss) for the<br> year** | **Retained earnings / (losses)** | **Other comprehensive income/(loss)** | **Total** |<br>**Non-controlling interest** |<br>**Total Equity** |
| **Balance at January 1, 2022** | **45122** | **18188** | **106920** | **(68067)** | **(33970)** | **(185)** | **68008** | **146** | **68154** |
| Net income/(loss) for the year |  |  |  | (46382) |  |  | (46382) | (1) | **(46383)** |
| Other comprehensive income/(loss) for the year | - | - | - | - | - | (1470) | (1470) | - | **(1470)** |
| **Total comprehensive income/ (loss) for the year** | **45122** | **18188** | **106920** | **(114449)** | **(33970)** | **(1655)** | **20156** | **145** | **20301** |
| Appropriation of result |  |  |  | 68067 | (68067) |  |  |  | **-** |
| Employee share-based compensation (Note 10) |  | 3369 |  |  |  |  | 3369 |  | **3369** |
| Other movements (Note 10) | - | 877 | - | - | - | - | 877 | - | **877** |
| **Balance at December 31, 2022** | **45122** | **22434** | **106920** | **(46382)** | **(102037)** | **(1655)** | **24402** | **145** | **24547** |
| Net income/(loss) for the year |  |  |  | (2417) |  |  | (2417) | 2 | **(2415)** |
| Other comprehensive income/(loss) for the year | - | - | - | - | - | (3402) | (3402) | - | **(3402)** |
| **Total comprehensive income/ (loss) for the year** | **-** | **-** | **-** | **(2417)** | **-** | **(3402)** | **(5819)** | **2** | **(5817)** |
| Appropriation of result |  |  |  | 46382 | (46382) |  |  |  | **-** |
| Debt modification (Note 10) |  | 310 |  |  |  |  | 310 |  | **310** |
| Capital increase (Note 10) | 176 | (176) |  |  |  |  |  |  | **-** |
| Employee share-based compensation (Note 10) | - | 2246 | - | - | - | - | 2246 | - | **2246** |
| **Balance at December 31, 2023** | **45298** | **24814** | **106920** | **(2417)** | **(148419)** | **(5057)** | **21139** | **147** | **21286** |
| Net income/(loss) for the year |  |  |  | 3908 |  |  | 3908 | 2 | **3910** |
| Other comprehensive income/(loss) for the year | - | - | - | - | - | (2834) | (2834) | - | **(2834)** |
| **Total comprehensive income/ (loss) for the year** |  | **-** | **-** | **3908** | **-** | **(2834)** | **1074** | **2** | **1076** |
| Appropriation of result |  |  |  | 2417 | (2417) |  |  |  | **-** |
| Capital increase (Note 10) | 193 | (193) |  |  |  |  |  |  | **-** |
| Employee share-based compensation (Note 10) | - | 1858 | - | - | - | - | 1858 | - | **1858** |
| **Balance at December 31, 2024** | **45491** | **26479** | **106920** | **3908** | **(150836)** | **(7891)** | **24071** | **149** | **24220** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 AND**

**CARVE-OUT STATEMENT OF CASH FLOWS**

**FOR THE YEAR ENDED DECEMBER 31, 2022**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| **Net income / (loss) before tax** | **5372** | **(8928)** | **(43415)** |
| **Adjustments to profit/loss:** | **1205** | **(3466)** | **(8595)** |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization (Note 14) | 146 | 114 | 556 |
| &nbsp;&nbsp;&nbsp;Movements in provisions | 1858 | 2246 | 3369 |
| &nbsp;&nbsp;&nbsp;Change in expected credit loss |  |  | 150 |
| &nbsp;&nbsp;&nbsp;Exchange rate impact (Note 14) | 6519 | 1618 | (5828) |
| &nbsp;&nbsp;&nbsp;Effect of hyperinflation on results (Note 14) | (8990) | (5292) | (2265) |
| &nbsp;&nbsp;&nbsp;Short term investment gain (Note 14) | (1382) | (1020) |  |
| &nbsp;&nbsp;&nbsp;Related parties debt restructuring (Note 14) |  | 1573 |  |
| &nbsp;&nbsp;&nbsp;Changes in fair value (Notes 11 and 14) | 3310 | (890) | (4215) |
| &nbsp;&nbsp;&nbsp;Deferred taxes (Note 13) |  |  | (61) |
| &nbsp;&nbsp;&nbsp;Interest (income)/expenses (Note 14) | (603) | (1815) | (88) |
| &nbsp;&nbsp;&nbsp;Interest expense on lease liabilities (Note 7) | 105 |  |  |
| &nbsp;&nbsp;&nbsp;Non-cash lease expense (Note 7) | 242 |  |  |
| &nbsp;&nbsp;&nbsp;Others |  |  | (213) |
| **Changes in working capital:** | **(541)** | **2034** | **10534** |
| &nbsp;&nbsp;&nbsp;Trade receivables and other current assets (Note 9) | 2136 | (9269) | (3935) |
| &nbsp;&nbsp;&nbsp;Trade payables and other current liabilities (Note 12) | (2677) | 11303 | 14469 |
| **Income tax paid** | **(2093)** | **(1220)** | **(881)** |
| **Net cash provided by (used in) operating activities** | **3943** | **(11580)** | **(42357)** |
| &nbsp;&nbsp;&nbsp;Payment for purchases of property, plant and equipment (Note 6) | (256) | (245) | (164) |
| **Net cash used in investing activities** | **(256)** | **(245)** | **(164)** |
| &nbsp;&nbsp;&nbsp;Drawdown of other borrowings (Note 11) | (1740) | 1330 |  |
| &nbsp;&nbsp;&nbsp;Interest paid on lease liabilities (Note 7) | (105) |  |  |
| &nbsp;&nbsp;&nbsp;Capitalized lease payments (Note 7) | (197) | - | - |
| **Net cash provided by (used in) financing activities** | **(2042)** | **1330** | **-** |
| **Net increase / (decrease) in cash and cash equivalents** | **1645** | **(10495)** | **(42521)** |
| Cash and cash equivalents at the beginning of the year | 41278 | 53808 | 94908 |
| Effect of changes in exchange rates on cash and cash equivalents | (2616) | (2035) | 1421 |
| Cash and cash equivalents at the end of the year | 40307 | 41278 | 53808 |

---

**NON-CASH TRANSACTIONS**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** | **2022** |
| Initial recognition of ROU and lease liabilities (Note 7) |  | 2200 |  |  |  |
| -Forgiveness of loan deemed as capital contribution |  |  |  | 311 |  |

---

The accompanying notes 1 to 19 are an integral part of the consolidated financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A. AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED** 

**FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023** 

**(*Thousands of Euros, except for share and per share amounts*)**

**1.**  **<u>BACKGROUND</u>** 

On June 4, 2021, Codere Online Luxembourg, S.A. (the "Company" and, together with its subsidiaries, "Codere Online"), was incorporated and was registered in Luxembourg as a public limited company (société anonyme) under the laws of Luxembourg with its registered office at 7, rue Robert Stumper, L-2557 Luxembourg, Grand Duchy of Luxembourg and has been registered with the Luxembourg trade and companies register (Registre de commerce et des sociétés, Luxembourg) under the number B255798.

The Company is comprised of the former online gambling operations of its majority shareholder Codere Group Topco, S.A. and its subsidiaries ("Codere Group") in Spain, Mexico, Colombia, Panama and Argentina focused on online gambling and other online services. As of December 31, 2024, Codere Group controls the Company through its operating Spanish Holdco, Codere Newco, S.A.U. ("CNEW"), which holds 65.95% of the ordinary shares of the Company.

Codere Group means until November 18, 2021, Codere, S.A. and its subsidiaries and from November 18, 2021 until October 15, 2024, Codere New Topco S.A. and its subsidiaries, and as of October 15, 2024, Codere Group Topco, S.A., its successors and assigns, and its subsidiaries from time to time, including Codere Newco. Codere Group is a leading international gaming operator that operates slot machines, bingo seats and sports betting terminals in Latin America (Argentina, Colombia, Mexico, Panama and Uruguay), Spain and Italy, across various gaming venues, including gaming halls, arcades, bars, sports betting shops and horse racetracks. Codere Group has been listed on the Madrid Stock Exchange since October 19, 2007 and Codere S.A.'s shares were delisted in 2022 as a result of a corporate restructuring.

The perimeter consists of 11 operating and supporting entities (Spain, United States, Mexico, Colombia, Panama, Gibraltar, Israel, Argentina and Malta) and 2 holding companies (Spain and Luxembourg).

---

| | | | |
|:---|:---|:---|:---|
| **Entity** | **Entity Type** | **Ownership** | **Location** |
| Codere Online Luxembourg S.A. | Holding Company | 100% | Luxembourg |
| Codere Online U.S. Corp. | Supporting Entity | 100% | United States |
| Servicios de Juego Online S.A.U. | Holding Company | 100% | Spain |
| Codere Online S.A.U. | Operating Entity | 100% | Spain |
| Codere Online Colombia S.A.S.\*\* | Operating Entity | 100% | Colombia |
| Operating Management Services Panama S.A.\*\* | Operating Entity | 100% | Panama |
| LIFO AenP.\*\* | Operating Entity | 99.99% | Mexico |
| Codere Online Mexico S.A de C.V. | Supporting Entity | 100% | Mexico |
| Codere Online Operator LTD\*\*\* | Operating Entity | 100% | Malta |
| Codere Online Argentina, S.A. \*\* | Operating Entity | 95% | Argentina |
| Codere Online Argentina, S.A. Unión Transitoria.\*\* | Operating Entity | 92.2%\* | Argentina |
| Codere Israel Marketing Support Services LTD. | Supporting Entity | 100% | Israel |
| Codere (Gibraltar) Marketing Services LTD.\*\*\*\* | Supporting Entity | 100% | Gibraltar |

---

---

| | |
|:---|:---|
| \* | 1% directly through SEJO and 96% indirectly through Codere Online´s 95% ownership of Codere Online Argentina, S.A. |
| \*\* | Please refer to Note 18 for more information about these entities. |
| \*\*\* | Its liquidation is still in process and, once completed, it will be effective as from August 28, 2024. |
| \*\*\*\* | Liquidated on January 17, 2024 |

---

[**Table of Contents**](#toc)

Following the incorporation of the Company, the creation of Codere Online was performed in three steps. The first two steps relate to the reorganization of all the online businesses of Servicios de Juego Online, S.A.U. (the "Restructuring"), which involved (1) the transfer of the relevant entities and businesses that were not direct or indirect subsidiaries or businesses of Servicios de Juego Online, S.A.U. ("SEJO") to SEJO, (2) the transfer of SEJO to Codere Online Luxembourg. The third step relates to the business combination agreement, which was entered into on June 21, 2021, between DD3 Acquisition Corp. II ("DD3"), a publicly listed entity in the United States whose shares were traded on the Nasdaq Capital Market ("Nasdaq"), Codere Online U.S. Corp ("Merger Sub"), a Delaware corporation newly created in 2021 as part of this transaction, CNEW, SEJO and the Company (the "Business Combination Agreement").

The first step of the creation of Codere Online (the "Restructuring") involved a corporate restructuring where all of the Codere Group's online gaming, gambling, casino, slots, poker, bingo, sports betting, betting exchanges, lottery operations, racing, and pari-mutuel activities became operated or owned by SEJO and its subsidiaries by holding or receiving assets, rights and/or entities from the Codere Group, as set forth in the Business Combination Agreement (except that, in Colombia, Panama and the City of Buenos Aires (Argentina), in lieu of causing the consummation of the restructuring step plan agreed with DD3 in respect of each of such jurisdictions, Codere Online entered into a Restructuring Agreement with the relevant subsidiaries of Codere Group in the affected jurisdiction). Prior to the corporate restructuring, the following entities were already wholly owned subsidiaries of SEJO: Codere Israel Marketing Support Services LTD, Codere Online Operator LTD, Codere Online Management Services LTD ("OMSE"), and Codere (Gibraltar) Marketing Services LTD.

In Spain and Italy, Codere Online, S.A.U. and Codere Scommese S.R.L., respectively, were transferred to, and became wholly owned subsidiaries of SEJO on June 27, 2021, which became in turn a subsidiary of the Company upon consummation of the Exchange.

In Panama and Colombia, new entities (Codere Online Panama S.A. and Codere Online Colombia SAS, respectively) were incorporated with SEJO as sole or majority shareholder as of October 1, 2021.

On November 15, 2021, Codere Colombia S.A., a subsidiary within Codere Group and the current holder of the online gaming license, and Codere Online Colombia entered into the following agreements, which were amended on November 30, 2021:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a sale and transfer agreement (as amended from time to time, the "Sale and Transfer Agreement") that governed the terms and conditions of the assignment, from Codere Colombia S.A. to Codere Online Colombia S.A.S., of all the assets, contracts and employees necessary for the operation of the Colombian online gaming business by Codere Online Colombia S.A.S. Certain of such assets and contracts are pending assignment as of the date of this annual report. In addition, Codere Colombia S.A. agreed to take any required action for the prompt approval, by the Colombian regulator ("Coljuegos"), of the transfer of the Colombian License to Codere Online Colombia S.A.S.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a joint accounts agreement (contrato de cuentas en participacion) (as amended from time to time, the "Joint Accounts Agreement") pursuant to which, pending the effective transfer of the Colombia License to Codere Online Colombia S.A.S. (or, if applicable, the granting of a new license to Codere Online Colombia S.A.S.), the parties agreed to jointly exploit the Colombia License, with Codere Online Colombia S.A.S. effectively retaining 99.00% of any distributed profits and generally managing the online gaming business; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a license assignment agreement (as amended from time to time, the "License Assignment Agreement" and, together with the Sale and Transfer Agreement and the Joint Accounts Agreement, the "Colombia Restructuring Agreements") pursuant to which Codere Colombia S.A. agreed to assign the Colombian License to Codere Online Colombia S.A.S., subject to the approval of Coljuegos.

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The transfer of the Colombian license to Codere Online Colombia S.A.S. was formally requested on December 21, 2021 pursuant to Agreement 08/2020 and Resolutions No. 20161200025334, 20164000029574 of 2016 and 20201000008294 of 2020. As of July 1, 2022, the transfer of the Colombian license to Codere Online Colombia S.A.S. has been approved from Coljuegos and Codere Online Colombia S.A.S. began operating the online business in Colombia under the Colombia License on September 1, 2022.

On November 15, 2021, Hipica de Panama, S.A. ("HIPA"), Alta Cordillera, S.A. ("ALTA"), and Codere Online Panama, entered into an agreement (as amended from time to time the "HIPA Restructuring Agreement"), pursuant to which: (i) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain employment agreements with certain HIPA employees; (ii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain sponsorship, licensing, marketing and other services agreements; (iii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right and title to certain assets in connection with HIPA's online gaming operations; and until the transfer of the ALTA license to Codere Online Panama is effective, Codere Online Panama agreed to provide certain operational and advisory services to HIPA in exchange for monthly payments from HIPA amounting to 99% of HIPA's net income from gaming operations. The HIPA Restructuring Agreement was amended on November 30, 2021.

In addition, on December 1, 2021, upon the commencement of the term of the ALTA license, Codere Online Panama and ALTA entered into an agreement (as amended from time to time the "ALTA Restructuring Agreement" and the HIPA Restructuring Agreement, as partially terminated and superseded by the ALTA Restructuring Agreement, the "Panama Restructuring Agreements") whereby Codere Online Panama agreed to provide certain operational and advisory services to ALTA in exchange for periodic payments on similar terms to the HIPA Restructuring Agreement, terminating and superseding the HIPA Restructuring Agreement with respect to the services being provided by Codere Online Panama to HIPA. The agreement between Codere Online Panama and ALTA shall terminate, among other things, if Codere Online Panama requests the transfer of the ALTA license to Codere Online Panama and such transfer is authorized by the Panama Gambling Control Board.

On November 15, 2021, Iberargen, S.A. a subsidiary within the Codere Group, and SEJO entered into an agreement (as amended from time to time, the "Argentina Restructuring Agreement") pursuant to which:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the parties agreed to jointly incorporate a new company in Argentina, Codere Online Argentina, S.A., with Iberargen, S.A. and SEJO initially retaining 5% and 95% stakes, respectively; Iberargen, S.A. agreed to assign any economic rights related to its 5% stake to SEJO and to seek to transfer such stake to SEJO, provided such transfer is legally allowed and does not affect Codere Online Argentina, S.A.'s operations or the Buenos Aires License;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Iberargen, S.A. undertook to take any required action to facilitate the approval, by Loteria de la Ciudad de Buenos Aires ("LOTBA"), of the transfer of the Buenos Aires License to Codere Online Argentina, S.A.;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Iberargen, S.A. undertook to, upon LOTBA's approval of such transfer (or, if applicable, the granting of a new license to Codere Online Argentina, S.A. by LOTBA) (the "Condition Precedent"), assign to Codere Online Argentina, S.A. the Buenos Aires License (if applicable) as well as any assets, contracts and employees necessary for the operation of the Argentine online gaming business by Codere Online Argentina, S.A.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Iberargen, S.A. agreed to, if LOTBA authorized it to operate in the City of Buenos Aires before the Condition Precedent is satisfied (as is currently the case), exploit the Buenos Aires License pursuant to the instructions of SEJO (or, once it is incorporated and duly registered, Codere Online Argentina, S.A.), with any resulting expenses and income being assigned to the latter; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) if LOTBA denies the transfer of the Buenos Aires License, and there is no reasonable likelihood that it will grant a new license to Codere Online Argentina, S.A. during the term of the Buenos Aires License, Iberargen, S.A. and Codere Online Argentina, S.A. shall enter into a Temporary Union Contract (contrato de union transitoria) and exploit the Buenos Aires License thereunder, with Codere Online Argentina, S.A. effectively retaining any distributed profits and generally managing the online gaming business.

The second step of the creation of Codere Online (the "Exchange") involved the transfer of SEJO to the Company in exchange for 29,970,000 of additional newly issued ordinary shares of the Company, nominal value of €1 per ordinary share, which were issued to CNEW. CNEW is a Spanish public limited liability company (Sociedad Anónima Unipersonal), having its registered office at 26, Avenida de Bruselas, 28108 Alcobendas, Madrid, Spain and registered with the trade registry of Madrid under the reference Volume 34399, page 192, section 8, Sheet M-618.784 and is the sole shareholder of the Company.

As explained above, Codere Online was reorganized through a series of corporate transactions. Firstly, the Restructuring and secondly the Exchange, which was the non-monetary contribution of SEJO to the Company at book value in exchange for 29,970,000 ordinary shares of the Company effective on November 29, 2021 (see Note 10). As result SEJO became a wholly owned subsidiary of the Company. The reorganization of all the online business under SEJO and the subsequent non-monetary contribution was considered a business combination under common control using the "predecessor accounting method".

The third step relates to the merger (the "Merger") of Codere Online U.S. Corp with and into DD3, with DD3 surviving the Merger as a wholly owned subsidiary of the Company. In connection therewith, DD3's corporate name changed to "Codere Online U.S. Corp". The Merger was closed on November 30, 2021, and immediately prior thereto, each share of DD3 Class B Common Stock issued and outstanding immediately prior to the close of the Merger was automatically converted and exchanged for one validly issued, fully paid and non-assessable share of DD3 Class A Common Stock (the "Class B Conversion"). Additionally, each share of DD3 Class A Common Stock issued and outstanding immediately prior to the close of the Merger (15,121,956 shares) was exchanged for one share of the Company (the "Ordinary Shares Merger Issuance") pursuant to a share capital increase of the Company (the "Company Capital Increase") (see Note 10). Additionally, the conversion of each DD3 warrant (6,435,000 warrants), which no longer represented a right to acquire one share of DD3 Class A Common Stock was substituted by the right to acquire one Company ordinary share on substantially the same terms. The Merger was not considered a business combination under IFRS 3, *Business Combinations*, but rather it has been accounted for under IFRS 2, *Share-based Payment*, as DD3 was not considered to be a business based on IFRS 3. As a result of the Exchange and the Merger completed on November 29 and November 30, 2021, respectively, SEJO and DD3 became direct wholly owned subsidiaries of the Company.

The transactions detailed above pursuant to the Business Combination Agreement, including the Restructuring, the Exchange, the Class B Conversion, the Merger and the Company Capital Increase, collectively represent the "Business Combination".

The ordinary shares and warrants of the Company have been listed on the Nasdaq since December 1, 2021.

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**2.**  **<u>BASIS OF PRESENTATION OF THE CONSOLIDATED FINANCIAL STATEMENTS</u>** 

The accompanying consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and pursuant to the interpretations issued by Interpretation Committee of the IASB ("IFRIC"). Note 3 includes a detailed description of the most significant accounting policies used consistently to prepare these consolidated financial statements.

The consolidated financial statements were approved by the board of directors on May 27, 2025.

The financial statements as of and for the year ended December 31, 2022 are consolidated carve-out financial statements.

The Restructuring was treated as a reorganization of entities under common control, which is outside of the scope of IFRS 3 (Business Combinations), as such entities were under the common control and managed by the Codere Group. Accordingly, the Codere Group made an accounting policy choice to present business combinations under common control using the "predecessor accounting method" or "pooling of interest method", which involves the following:

● The assets and liabilities of the entities subject to the Restructuring were reflected at their carrying amounts in Codere Group's consolidated carve-out financial statements. No adjustments were made to reflect fair values or recognize any new assets or liabilities at the Exchange Effective Time (means 10:00 a.m. New York time on November 29, 2021) that would otherwise be done under the acquisition method.

● Any difference between the consideration paid/transferred and the aggregate book value of the assets and liabilities of the entities subject to the Restructuring as of the Exchange Effective Time was reflected as an adjustment to equity.

● Include all revenues, expenses, assets and liabilities attributed to the online business as part of the Restructuring.

● Under the pooling of interest method, each of the entities subject to the Restructuring is accounted for as if it had always been part of Codere Online.

The consolidated carve-out financial statements are considered "carve-out" financial statements because the 2022 income statement and statement of cash flows include carved-out results related to the online businesses of certain entities of the Codere Group. In 2021, these entities and/or businesses were transferred to, and became wholly owned subsidiaries of SEJO, which became in turn a subsidiary of the Company upon consummation of the Exchange, except as described herein with respect to (i) Colombia, Panama and the City of Buenos Aires (Argentina), where Restructuring Agreements were entered into, and (ii) Mexico, where Codere Online operates under an "Asociación en Participación" or "AenP", and except for the online business results carved out from Iberagen, S.A. to be presented in the relevant financial statements of Codere Group, until the incorporation of Codere Online Argentina, S.A. in July 18, 2022.

Additionally, as explained in greater detail in Note 1, the Merger was completed on November 30, 2021 and DD3 became a part of Codere Online. The Merger was not considered a business combination under IFRS 3 (Business Combinations), but rather it was accounted for under IFRS 2 (Share-based Payment), as DD3 was not considered to be a business under IFRS 3. Therefore, the accounting of the Merger in the Annual Financial Statements is as follows:

● To reflect the combination, the equity of DD3 was eliminated and the equity of the Company stayed as the accounting acquirer.

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● The difference in the fair value of the ordinary shares transferred to holders of DD3 common stock in excess of the fair value of the net assets contributed by DD3's shareholders represented a service cost for the listing of ordinary shares of the Company, amounting to € 35.8 million and was accounted for as a share-based payment in accordance with IFRS 2.

The cost of the service, which is a non-cash expense, was €35.8 million and was accounted for as an expense for the Company at the time of the consummation of the Business Combination.

Transaction costs incurred in connection with the consummation of the Business Combination amounted to a total of €16.4 million, of which (i) DD3 incurred €6.8 million, which were accounted for as a reduction in cash and cash equivalents and a corresponding reduction in share premium of the Company in the consolidated carve-out financial statements of Codere Online for the year ended December 31, 2021 and (ii) SEJO incurred €9.6 million, of which €3.0 million were assumed by Codere Online, and which were reflected as an increase in other operating expenses and as a combination of a reduction in cash and cash equivalents and an increase in share premium of the Company in the consolidated carve-out financial statements of Codere Online from the year ended December 31, 2021.

**Changes in perimeter**

The perimeter of Codere Online consists of 11 operating and supporting entities (Spain, United States, Mexico, Colombia, Panama, Gibraltar, Israel, Argentina and Malta) and 2 holding companies (Spain and Luxembourg) as described in Note 1 of these Consolidated Financial Statements.

Codere (Gibraltar) Marketing Services LTD operations were discontinued effective as of April 30, 2023 and was liquidated on January 17, 2024, as detailed in Other Information Note (Note 18).

The Malta operating entity (Codere Online Operator LTD) liquidation is still in process and, once completed, it will be effective as from August 28, 2024.

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**3.**  **<u>ACCOUNTING POLICIES</u>** 

As stated in Note 2, Codere Online's consolidated financial statements for the periods ended December 31, 2024 and 2023, have been prepared in accordance with IFRS as issued by the IASB and pursuant to the interpretations issued by the IFRIC.

Codere Online adopted Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2), effective January 1, 2023. Although the amendments did not result in any changes to the accounting policies themselves, they impacted the accounting policy information disclosed in the financial statements.

The amendments require the disclosure of 'material', rather than 'significant', accounting policies. The amendments also provide guidance on the application of materiality to disclosure of accounting policies, assisting entities to provide useful, entity-specific accounting policy information that users need to understand other information in the financial statements.

The following is a description of the material accounting policies used in preparing the accompanying consolidated financial statements:

&nbsp;&nbsp;&nbsp;&nbsp;a) Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to December 31, 2024.

Control over an investee is achieved by a person or entity when such person or entity (i) has power over the investee, (ii) has exposure, or has rights, to variable returns from its involvement with the investee or (iii) has the ability to use its power to affect the investee's variable returns.

The Company holds 100% ownership of its subsidiaries except for (i) the AenP with LIFO, under which the Company is entitled to receive 99.99% of any distributed profits and (ii) Codere Online Argentina, S.A., of which SEJO initially held 95% and the economic rights over the remaining 5% after it was incorporated and registered on January 28, 2022. Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in profit or loss from the date the Company gains control until the date when the Company ceases to control the subsidiary. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used in line with the Company's accounting policies. All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between the members of the Company are eliminated on consolidation.

Regarding the Restructuring of the entities under common control, was treated as a reorganization of entities under common control, which is outside of the scope of IFRS 3 (Business Combinations). Accordingly, the Company made an accounting policy choice to present business combinations under common control using the "predecessor accounting method" or "pooling of interest method", which means the assets and liabilities of the incorporated businesses were reflected at their carrying amounts. No adjustments were made to reflect fair values or recognize any new assets or liabilities at the date of the Closing of the Business Combination that would otherwise be done under the acquisition method. Additionally, any difference between the consideration paid/transferred and the aggregate book value of the assets and liabilities of the acquired entities as of the date of the relevant transaction was reflected as an adjustment to equity.

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The consolidated carve-out financial statements were prepared using Codere Group's historical basis in the assets and liabilities and include all revenues, expenses, assets and liabilities attributed to Codere Online up as part of the Restructuring, including certain general and administrative services provided by Codere Group. These general and administrative services were provided by Codere Online until consummation of the Business Combination on November 30, 2021. Codere Online believes that by including these costs, the consolidated carve-out income statement include a reasonable estimate of actual costs incurred to operate the business. However, such expenses may not be indicative of the actual level of expense that would have been incurred by the Group if it had operated as an independent, publicly traded company during the precedent periods or of the costs expected to be incurred in the future. Codere Online entered into an agreement with Codere Group effective from December 1, 2021, the day after the closing date of the Business Combination, whereby Codere Group has agreed to provide Codere Online with the resources to comply with regulators, authorities and other third parties in general. The purpose of this contract is to ensure that Codere Online is complying with its obligations and correctly reflecting its costs. The fee for these services as per the agreement is 0.75% of Codere Online's revenue.

&nbsp;&nbsp;&nbsp;&nbsp;b) Functional and presentation currency

The functional currency of all entities comprising Codere Online is the currency of the countries in which they operate. The presentation currency of Codere Online is the Euro and therefore, all balances and transactions denominated in currencies other than the Euro are deemed to be denominated in a foreign currency.

Transactions in foreign currencies are translated at their initial valuation at the spot exchange rate in effect at the transaction date. Monetary assets and liabilities denominated in foreign currencies are translated at the spot exchange rate prevailing at the balance sheet date. Exchange differences, both positive and negative, arising in this process, as well as those arising on settlement of these assets and liabilities, are recognized in the consolidated statement of operations and carve-out income statement for the year in which they arise.

Amounts are presented in these consolidated financial statements are in thousands of euros, unless otherwise stated.

&nbsp;&nbsp;&nbsp;&nbsp;c) Entities located in hyperinflationary economies

In accordance with IAS 29 "Financial Reporting in Hyperinflationary Economies" a subsidiary operates in a country with hyperinflationary economy when the cumulative inflation rate over three years approaches or exceeds 100%. The standard provides the following criteria for determining whether an economy is experiencing hyperinflation: The population expresses prices in terms of a foreign currency or a relatively stable index, the general population prefers to keep its wealth in non-monetary assets or in a relatively stable foreign currency, sales and purchases on credit take place at prices that compensate for the expected loss of purchasing power during the credit period, even if the period is short or the inflation rate over 12 months is equal to or exceeds 50%.

Since 2018, the economy of Argentina, has been considered hyperinflationary under the above criteria and mainly because Argentina had a significant increase in inflation which by the end of 2018 had reached 48% per year (147% accumulated in three years).

When IAS 29 applies, the subsidiary's financial statements are adjusted for the effects of changes in the general price level, in order to provide users with information that is more meaningful and useful, which means that:

Adjust the historical cost of the non-monetary assets and liabilities and the various equity items from the date of acquisition or incorporation onto the consolidated statement of financial position until the end of the financial year to reflect changes in the purchasing power of the currency as a result of inflation.

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- To reflect the gain or loss corresponding to the impact of the year's inflation on the net monetary position on the consolidated statement of operations and carve-out income statement.

- Adjust the different items on the consolidated statement of operations and carve-out income statement and cash flow statement by the inflationary index since their generation, with a balancing entry in financial results and a reconciling item in the cash flow statement, respectively.

- Convert all components of the financial statements to the closing exchange rate. In the case of the Argentine companies, to the closing exchange rate as at 31 December 2024 being 565 pesos per euro.

At December 31, 2024, no country other than Argentina in which the consolidated entities of Codere Online are located, is considered to have a hyperinflationary economy in accordance with the criteria established in this regard by IFRS-IASB.

&nbsp;&nbsp;&nbsp;&nbsp;d) Intangible assets

Intangible assets are carried at acquisition or production cost, less any accumulated amortization and impairment losses, if any. These assets are tested for impairment when events or circumstances arise that may indicate that their book value may not be recoverable.

Intangible assets can have (i) an indefinite useful life when, based on an analysis of all the relevant factors, it is concluded that there is no foreseeable limit to the period over which the asset is expected to generate net cash inflows for the consolidated entities or (ii) a finite useful life, in all other cases.

Intangible assets with indefinite useful lives are not amortized. When intangible assets have an indefinite life, an impairment analysis is required at least annually, regardless of whether there is a triggering event. Management performs an impairment analysis at the end of each reporting period or whenever there is any indication of impairment. As part of this analysis, management also reviews the remaining useful lives of the assets in order to determine whether they continue to be indefinite and, if this is not the case, to take the appropriate steps to amortize the asset.

As required, management also performs an analysis on intangible assets with definite useful lives in order to determine whether there are any potential indicators of impairment. Intangible assets with definite useful lives are amortized on a straight-line basis according to the following:

● Licenses for computer programs acquired from third parties are capitalized based on the costs incurred to acquire them and to prepare each specific program for use. These costs are amortized over their estimated useful lives.

&nbsp;&nbsp;&nbsp;&nbsp;e) Property, plant and equipment ("PP&E")

Property, plant and equipment is carried at cost less any accumulated depreciation and impairment in value, if any.

Cost includes, among others, direct labor costs incurred in the installation and the relevant allocable portion of the indirect costs.

Codere Online depreciates its property, plant and equipment from the time they can be placed in service, depreciating the cost of the assets on a straight-line basis over the assets' estimated useful lives, which are as follows:

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| | |
|:---|:---|
|  | **Years of estimated<br> useful life** |
| Machinery and equipment | 3-10 years |
| Other fixtures, fittings and tools | 3-15 years |

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&nbsp;&nbsp;&nbsp;&nbsp;f) Leases

Codere Online assesses whether a contract is or contains a lease, at inception of the contract. Codere Online recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets (such as tablets and personal computers, small items of office furniture and telephones). For these leases, Codere Online recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the group uses its incremental borrowing rate.

The incremental borrowing rate depends on the term, currency and start date of the lease and is determined based on a series of inputs including: the risk-free rate based on government bond rates; a country-specific risk adjustment; a credit risk adjustment based on bond yields; and an entity-specific adjustment when the risk profile of the entity that enters into the lease is different to that of the group and the lease does not benefit from a guarantee from the group.

Lease payments included in the measurement of the lease liability comprise.

● fixed lease payments (including in-substance fixed payments), less any lease incentives receivable;

● variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date;

● the amount expected to be payable by the lessee under residual value guarantees;

● the exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and

● payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.

The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect the lease payments made.

Codere Online remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever:

● the lease term has changed or there is a significant event or change in circumstances resulting in a change in the assessment of exercise of a purchase option, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate.

● the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a revised discount rate is used.

● a lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease liability is remeasured based on the lease term of the modified lease by discounting the revised lease payments using a revised discount rate at the effective date of the modification.

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Codere Online did not make any such adjustments during the periods presented.

The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, less any lease incentives received and any initial direct costs. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Whenever Codere Online incurs an obligation for costs to dismantle and remove a leased asset, restore the site on which it is located or restore the underlying asset to the condition required by the terms and conditions of the lease, a provision is recognised and measured under IAS 37. To the extent that the costs relate to a right-of-use asset, the costs are included in the related right-of-use asset, unless those costs are incurred to produce inventories.

Right-of-use assets are depreciated over the shorter period of the lease term and useful life of the right-of-use asset. If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the group expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease.

Codere Online applies IAS 36 to determine whether a right-of-use asset is impaired and accounts for any identified impairment loss as described in Note 3 (g).

Variable rents that do not depend on an index or rate are not included in the measurement the lease liability and the right-of-use asset. The related payments are recognised as an expense in the period in which the event or condition that triggers those payments occurs.

&nbsp;&nbsp;&nbsp;&nbsp;g) Impairment of non-current assets

Non-current assets are assessed at each reporting date for indicators of impairment if there are certain events or changes indicating the possibility that the carrying amount may not be fully recoverable. Whenever such indicators arise, or in the case of assets which are subject to an annual impairment test, the recoverable amount is estimated. An asset's recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future post-tax cash flows derived from the use of the asset or its cash generating unit, as applicable, are discounted to the asset's present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset, whenever the result obtained is the same that would be obtained by discounting pre-tax cash flows at a pre-tax discount rate.

&nbsp;&nbsp;&nbsp;&nbsp;h) Financial instruments

*Classification of financial assets and financial liabilities*

Financial assets and financial liabilities are recognized when an entity within Codere Online becomes a party to the contractual provisions of a financial instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through net income or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through net income or loss are recognized immediately in the consolidated statements of operations and carve-out income statement.

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Financial assets

Financial assets are classified into three main categories: amortized cost, fair value through net income or loss and fair value through OCI, depending on the business model and the characteristics of the contractual cash flows.

Loans, accounts receivable and financial assets that Codere Online expressly intends and is able to hold to maturity are subsequently measured at amortized cost less any related impairment losses.

Loans and accounts receivable maturing within no more than 12 months from the reporting date are classified as current items and those maturing within more than 12 months are classified as non-current items.

*Impairment of financial assets*

Codere Online recognizes a loss allowance for expected credit losses on investments in debt instruments which are measured at amortized cost. The amount of expected credit losses is updated on each reporting date to reflect changes in credit risk since the initial recognition of the financial instrument.

Codere Online recognizes lifetime Expected Credit Losses ("ECL") for receivables, applying the simplified approach established by the IFRS 9 standard. As Codere Online's historical credit loss experience between Group's entities is nil, the expected credit loss is estimated based on certain risk parameters, publicly available, such as the probability of default (PD) of Codere Online and a loss given at default (LGD) of 100%.

*Derecognition of financial assets*

Codere Online derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If Codere Online neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, Codere Online recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If Codere Online retains substantially all the risks and rewards of ownership of a transferred financial asset, Codere Online continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.

With respect to the derecognition of a financial asset in its entirety, the difference between the asset's carrying amount and the sum of the consideration received (and which will be received in the future) and the cumulative gain or loss that had been recognized in the consolidated statements of comprehensive income and accumulated in equity is recognized in the consolidated statements of operations and carve-out income statement.

Financial liabilities

*Financial liabilities at amortized cost*

Financial liabilities are subsequently measured at amortized cost using the effective interest method.

The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the exact rate that discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

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*Financial liabilities at fair value through profit or loss*

Financial liabilities are classified at fair value through profit or loss ("FVTPL") when the financial liability is (i) contingent consideration of an acquirer in a business combination, (ii) held for trading or (iii) it is designated as at FVTPL.

Financial liabilities at fair value through profit or loss are measured at fair value, with any gains or losses arising on changes in fair value recognized in profit or loss to the extent that they are not part of a designated hedging relationship. The net gain or loss recognized in profit or loss incorporates any interest paid on the financial liability and is included in net financial results in profit or loss.

For financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability's credit risk in other comprehensive income would create or enlarge an accounting mismatch in the consolidated statement of operations and carve-out income statement. The remaining amount of change in the fair value of liability is recognized in the consolidated statement of operations and carve-out income statement. Changes in fair value attributable to a financial liability's credit risk that are recognized in other comprehensive income are not subsequently reclassified to profit or loss; instead, they are transferred to retained earnings upon derecognition of the financial liability.

*Derecognition of financial liabilities*

Codere Online derecognizes financial liabilities when, and only when, Codere Online's obligations are discharged, cancelled or expire. The difference between the carrying amount of the derecognized financial liability and the consideration paid and payable is recognized in the consolidated statements of operations and carve-out income statement.

*Accounting for warrants*

The warrants meet the definition of a derivative financial instrument as they represent a written put option that gives the holders of the warrants the right to exchange them for Codere Online's shares at a fixed price. Although the warrants will be exchanged for Codere Online's shares based on the terms of the warrant agreement, the warrants were classified as a derivative financial liability measured at FVTPL, and not as an equity instrument. Changes in the fair value of the financial liability are presented in the consolidated statements of operations and carve-out income statement under the heading "Finance income / (costs)".

&nbsp;&nbsp;&nbsp;&nbsp;i) Cash and cash equivalents

Cash and cash equivalents comprise cash in hand and at banks, demand deposits and other short-term highly liquid investments with maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. These items are stated, based on their nature, at historical cost, amortized cost or fair value, which does not differ significantly from realizable value.

&nbsp;&nbsp;&nbsp;&nbsp;j) Revenue

Revenue from contracts with customers is recognized when service is provided to the customer at an amount that reflects the consideration to which Codere Online expects to be entitled in exchange for those services. Codere Online has generally concluded that it is the principal in its revenue arrangements because it typically controls the services before providing them to the customer.

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*Online gambling*

Codere Online generates its revenues from online gambling (online casino and sports betting). Codere Online recognizes revenue from online gambling at a point in time when each wager has been made and resolved. It is recorded as gambling revenue in the accompanying consolidated statements of operations and carve-out income statement, with liabilities recognized and measured as the aggregate net difference between funds deposited by customers plus winning wagers less losing wagers and less customers withdrawals. We report all the wins as revenue and our provider's share is reported in other operating expenses.

*Balances related to revenue*

A liability is recognized as an obligation to provide the gambling service to a customer for which Codere Online has received consideration from the customer, at which time a contract liability is recognized under trade payables and other current liabilities. For example, online sports betting involves a player placing a wager on a particular outcome of a sporting event at some fixed odds.

&nbsp;&nbsp;&nbsp;&nbsp;k) Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax, if any.

*Current tax*

The tax currently payable is based on taxable income for the year. Taxable income differs from income before tax as reported in the consolidated statement of operations and carve-out income statement because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. Codere Online's current tax is calculated using rates applicable for the tax period that have been enacted or substantively enacted by the end of the reporting period.

*Tax impacts of the Business Combination*

As a result of the Business Combination explained in Note 1, the following steps were followed:

- Carve-out process in different countries:

The financial information related to Codere Group's online business was carved-out from the traditional retail business. See considerations for each country below.

**Spain:** The Spanish company Codere España S.A. performed a financial spin-off of its shares in Codere Online (Melilla) in favour of SEJO. Based on the valid economic grounds of the transaction, Codere Online has applied the tax neutrality regime that provides roll over relief for Spanish CIT purposes. Codere Online complied with the formal obligations to apply this regime (formally opt for the regime and communication to the Tax Authorities). As per IAS 12, no deferred taxes have been recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the shares transferred were transferred at the value it had in the transferor for accounting and tax purposes.

**Mexico:** SEJO entered into a joint venture agreement (AenP or "Asociacion en Participacion" in Spanish) and set up "Codere Online Mexico AenP", which is owned by two partners, Libros Foráneos, which holds 0.01%, and SEJO acting as the online gambling holding entity, which holds 99.99%. From a Mexican tax perspective, entering into this joint venture agreement did not create any adverse (direct or indirect) Mexican tax implications. As per IAS 12, no deferred taxes have been recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the transfer of the business was done at fair market value for accounting and tax purposes.

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**Italy:** Codere Scommese S.r.l. ("Codere Scommese") only performs activities related to the online business and not traditional retail activities; therefore, the shares of the entity were directly transferred from Codere Scommese to SEJO. The transfer of the shares has given rise to a capital gain that will be taxed in the corporate income tax of Codere Online. However, Codere Online will apply the 95% "participation exemption" as the requirements for the application of the exemption are met. As per IAS 12, no deferred tax assets or liabilities have been recorded as a consequence of this transaction as the transfer of Codere Scommese's shares were valued for accounting and tax purposes at market value.

**Argentina:** The entity that held the online license in Argentina was Iberargen, S.A. ("Iberargen"). As Codere Online Argentina has not been registered yet, the entity that is operating the online business is Iberargen and the results from online business of Argentina were carve-out from Iberargen since the online operations in Argentina started on December 1, 2021. There are no tax implications on the incorporation of Codere Online Argentina.

**Panama:** The entity that held the online license in Panama was Hípica de Panama, S.A. ("HIPA") until December 1, 2021 and ACOR as from December 1, 2021. SEJO did incorporate a new entity in Panama, Codere Online Panama, that has applied for a new online gambling license, as the ones owned by HIPA and ACOR cannot be transferred to Codere Online Panama for regulatory reasons. There were no tax implications on the incorporation of Codere Online Panama. In the meantime, Codere Online Panama will render online management services to HIPA and ACOR. Remuneration for management services rendered by Codere Online Panama to HIPA and ACOR has been agreed at arm's length. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

**Colombia:** The entity that holds the online license in Colombia is Codere Colombia S.A. ("CCOL"). The transfer of the online license from CCOL to Codere Online Colombia has already been requested to the regulatory agent. There were no tax implications on the incorporation of Codere Online Colombia. In the meantime, Codere Online Colombia will render online management services to CCOL. Remuneration for management services rendered by Codere Online Colombia to CCOL has been agreed at arm's length. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

- Incorporation of the Company in Luxembourg and Merger Sub in Delaware:

CNEW incorporated the Company in Luxembourg on June 4, 2021. In addition, the Company incorporated a subsidiary corporation in Delaware, Merger Sub. No adverse tax implications arose in Luxembourg or the United States for the incorporation of these entities. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

- Share for share Exchange:

Following the Restructuring CNEW contributed SEJO to The Company pursuant to the Exchange. In Spain, based on the valid economic grounds of the transaction, Codere Online has applied the tax neutrality regime that provides roll over relief for Spanish CIT purposes. Codere Online complied with the formal obligations to apply this regime (formally opt for the regime and communication to the tax authorities). In Luxembourg, no adverse tax impact arose, as the transfer of the shares in SEJO in exchange for new shares in the Company was performed at fair market value and the Company issued shares for the same value. As per IAS 12, no deferred taxes were recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the shares transferred were transferred at the value it had in the transferor for accounting and tax purposes.

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- Reverse merger for the SPAC (DD3)

The Merger was effective on November 30, 2021 (i.e., one business day after effectiveness of the Exchange. In Luxembourg, no adverse tax impact arose. In the United States, no adverse tax impact arose as the adverse consequences of the inversion rules were not applicable (see "U.S. Anti-Inversion Rules" section below).

- Capital Increase

The Company increased its share capital in connection with the Merger. This share capital increase was subscribed by DD3's shareholders by means of the contribution of their Class A common stock (following the Class B Conversion) of DD3. That is, DD3's shareholders exchanged their DD3 common stock for ordinary shares of The Company. Following the consummation of the Merger, the Company became the sole shareholder of DD3 and the former shareholders of DD3 became shareholders of The Company, together with Codere Newco. In Luxembourg, no adverse tax impact arose, as the Company issued new instruments with a value which corresponds to the fair market value of the DD3's Class A common stock.

*United States ("U.S.") Anti-Inversion Rules*

Under the U.S. "anti-inversion" rules, adverse consequences may apply to certain acquisitions of domestic corporations and domestic partnerships (or their assets) by foreign corporations. These consequences generally depend, among other things, on the degree of ownership continuity by former shareholders of the domestic acquired corporation or partnership.

A U.S. inversion transaction generally is a transaction in which a U.S. parented group changes the jurisdiction of its parent corporation to a foreign jurisdiction. Generally, an inversion transaction is subject to Section 7874 and has adverse tax consequences when: (i) a foreign corporation acquires a U.S. corporation (or substantially all of its assets), (ii) the shareholders of the U.S. corporation receive 60% or more of the stock of the foreign corporation and (iii) following the acquisition the foreign corporation does not have 25% or more of its worldwide operations in its country of organization.

Codere Online and its U.S. tax advisors have reviewed the requirements of the application of the U.S. inversion rules to the reverse merger of Merger Sub into DD3 and concluded that the U.S. inversion rules stated in Section 7874 should not apply because the shareholders of DD3 received for purposes of Section 7874 less than 60% of the ordinary shares of The Company. However, the rules for determining ownership under Section 7874 are complex, unclear in some respects, and the subject of ongoing and recent legislative and regulatory review.

*Global minimum top-up tax*

Codere Online has adopted International Tax Reform — Pillar Two Model Rules (Amendments to IAS 12) upon their release on 23 May 2023. The amendments provide a temporary mandatory exception from deferred tax accounting for the top-up tax, which is effective immediately, and require new disclosures about the Pillar Two exposure (see Note 13).

&nbsp;&nbsp;&nbsp;&nbsp;l) Non-current and current assets and liabilities

Presentation in the consolidated statements of financial position differentiates between current and non-current assets and liabilities. Assets and liabilities are regarded as current if they mature within one year or within the normal business cycle of Codere Online or are held-for-sale. Non-current assets and liabilities include all other types of assets and liabilities.

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&nbsp;&nbsp;&nbsp;&nbsp;m) Use of estimates and judgements

The preparation of these financial statements requires Codere Online to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Codere Online's estimates are based on its historical experience and on various other factors that Codere Online believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

The areas requiring management's significant estimates and judgements involve:

● The calculation of expected credit losses, which, although with limited impact, is based on assumptions developed by the Company;

● The valuation of share-based payment arrangements under the Long-Term Incentive Plan (LTIP), including the use of a Monte Carlo simulation model to value restricted shares and options granted in 2024, and the application of a 47.2% payout rate for the fair value of deferred payment rights;

● The assessment of the recoverability of tax loss carryforwards, which involves judgment regarding future taxable income and timing of utilization.

&nbsp;&nbsp;&nbsp;&nbsp;n) New IFRS and interpretations of the IFRS Interpretations Committee ("IFRIC")

Codere Online has applied all of the applicable IFRS-IASB standards and amendments that were effective for periods ended December 31, 2024 and prior to such date. Codere Online has used the same accounting policies in its opening IFRS consolidated statement of financial position and through all of the periods presented in these consolidated financial statements.

As of December 31, 2024, the following standards, amendments and interpretations have been published by the IASB, but their application is not yet mandatory for Codere Online, and Codere Online has not elected to early adopt the policies once allowed to do so. Codere Online intends to adopt these new and amended standards and interpretations, if applicable, when they become effective.

 

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| | | | |
|:---|:---|:---|:---|
| **Standards and Amendments** | **Standards and Amendments** | **Standards and Amendments** | **Mandatory application:<br> annual periods beginning on or after** |
|  | ● | clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion; |  |
|  | ● | add new disclosures for certain instruments with contractual terms that can change cash flows (such as some financial instruments with features linked to the achievement of environment, social and governance targets); and |  |
|  | ● | update the disclosures for equity instruments designated at fair value through other comprehensive income (FVOCI). |  |
| IFRS 18 Presentation and Disclosure in Financial Statements | IFRS 18 will replace IAS 1 Presentation of financial statements, introducing new requirements that will help to achieve comparability of the financial performance of similar entities and provide more relevant information and transparency to users. Even though IFRS 18 will not impact the recognition or measurement of items in the financial statements, its impacts on presentation and disclosure are expected to be pervasive, in particular those related to the statement of financial performance and providing management-defined performance measures within the financial statements. | IFRS 18 will replace IAS 1 Presentation of financial statements, introducing new requirements that will help to achieve comparability of the financial performance of similar entities and provide more relevant information and transparency to users. Even though IFRS 18 will not impact the recognition or measurement of items in the financial statements, its impacts on presentation and disclosure are expected to be pervasive, in particular those related to the statement of financial performance and providing management-defined performance measures within the financial statements. | 1 January 2027 |
| IFRS 19 Subsidiaries without Public Accountability: Disclosures | Issued in May 2024, IFRS 19 allows for certain eligible subsidiaries of parent entities that report under IFRS Accounting Standards to apply reduced disclosure requirements. | Issued in May 2024, IFRS 19 allows for certain eligible subsidiaries of parent entities that report under IFRS Accounting Standards to apply reduced disclosure requirements. | 1 January 2027 |

---

Codere Online estimates that no standards, amendments and interpretations in the preceding table will have a significant impact on the consolidated financial statements in the initial period of application. However, Codere Online is currently assessing the detailed implications of applying IFRS 18 on Codere Online's consolidated financial statements.

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**4.**  **<u>SEGMENT INFORMATION</u>** 

Under IFRS 8 (*Segment Information*), operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM") which, in the case of Codere Online, is the Chief Executive Officer ("CEO") of Codere Online. The CODM is responsible for allocating resources and assessing performance of the business. For management purposes, Codere Online's operating segments are formed by Codere Online's online business in Spain, Mexico, Colombia, Panama, Argentina and Israel.

The CEO measures the performance of Codere Online's business by its revenue and EBITDA, which is calculated as net income/(loss), after adding back income tax benefit/(expense), interest expense, depreciation and amortization.

Codere Online will report financial information, both internally and externally, based on the organizational structure approved by the CEO of Codere Online. Thus, the reportable segments for the 2024 consolidated financial statements are formed by Codere Online's operations in Spain, Mexico and Colombia. Panama, Argentina are grouped under "Other operations". Codere Israel Marketing Support Services LTD and Codere Online, Codere (Gibraltar) Marketing Services LTD, SEJO and Surviving Corporation have been grouped and reported under "Supporting". These entities aggregated under "Supporting" segment are not operating entities (only holding companies) to entities that only provide internal support services.

The entities that have been aggregated under "Other operations" and "Supporting" have been grouped in accordance with guidance allowed under IFRS 8, *Operating Segments*. Based on both IFRS 8: BC30 and the diagram included in the implementation guidance accompanying IFRS 8, if two or more components of a business meet the aggregation criteria, they may be combined for external reporting purposes into a single operating segment, notwithstanding that they may individually exceed the quantitative thresholds. Additionally, the entities aggregated in the "Other operations" and "Supporting" segments all meet the following conditions: (i) aggregation is consistent with the core principle of IFRS 8, (ii) the segments have similar economic characteristics, (iii) the segments are similar in the nature of the products and services offered, (iv) the segments are similar in the nature of their production processes, (v) the segments are similar in the type or class of customer for their products and services, (vi) the segments have similar methods used to distribute their products and provide their services and (vii) the segments have a similar nature of their regulatory environment. The segments referred to above include the information related to the online business provided in each country. Inter-segment transactions are carried out on an arm's length basis and are included in the "Eliminations" column. Information relating to other Codere Online companies not specifically included in these segments is reported under "Other Operations".

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The following tables break down certain of the information presented in the consolidated statements of operations and carve-out income statement for the years ended December 31, 2024, 2023 and 2022 by Codere Online's operating segments (amounts expressed in thousands of euros).

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2024** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Codere<br> Online** |
| **Revenue** | **87778** | **95699** | **10629** | **6587** | **52204** | **(52193)** | **200704** |
| Personnel expenses | (2360) | (1746) | (331) | (1041) | (13306) |  | (18784) |
| Depreciation and amortization | (123) | (30) | (2) | (7) | (226) |  | (388) |
| Other operating expenses | (67786) | (96322) | (8986) | (11394) | (44906) | 52193 | (177201) |
| **Operating expenses** | **(70269)** | **(98098)** | **(9319)** | **(12442)** | **(58438)** | **52193** | **(196373)** |
| **OPERATING INCOME/(LOSS)** | **17509** | **(2399)** | **1310** | **(5855)** | **(6234)** | **-** | **4331** |
| Finance income | 2105 | 622 | 61 | 11461 | 4659 | (10727) | 8181 |
| Finance costs | (69) | (3552) | (371) | (5613) | (8262) | 10727 | (7140) |
| **Net finance income/(costs)** | **2036** | **(2930)** | **(310)** | **5848** | **(3603)** | **-** | **1041** |
| **NET INCOME/(LOSS) BEFORE TAX** | **19545** | **(5329)** | **1000** | **(7)** | **(9837)** | **-** | **5372** |
| Income tax benefit/(expense**)** | (4154) | 7 | 1 | 26 | 2658 | - | (1462) |
| **NET INCOME/(LOSS) FOR THE YEAR** | **15391** | **(5322)** | **1001** | **19** | **(7179)** | **-** | **3910** |
| Attributable to equity holders of the Company | 15391 | (5324) | 1001 | 19 | (7179) |  | 3908 |
| Attributable to non-controlling interests |  | 2 |  |  |  |  | 2 |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2023** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Codere<br> Online** |
| **Revenue** | **75669** | **73315** | **8581** | **4082** | **45263** | **(45263)** | **161647** |
| Personnel expenses | (1968) | (1776) | (292) | (700) | (12701) |  | **(17437)** |
| Depreciation and amortization | (24) | (32) | (2) | (6) | (50) |  | **(114)** |
| Other operating expenses | (60362) | (83181) | (10587) | (8897) | (41086) | 45263 | **(158850)** |
| **Operating expenses** | **(62354)** | **(84989)** | **(10881)** | **(9603)** | **(53837)** | **45263** | **(176401)** |
| **OPERATING INCOME/(LOSS)** | **13315** | **(11674)** | **(2300)** | **(5521)** | **(8574)** | **-** | **(14754)** |
| Finance income | 1030 | 6552 | 403 | 8586 | 28553 | (23406) | **21718** |
| Finance costs | (51) | (4920) | (11) | (8568) | (275423) | 273081 | **(15892)** |
| **Net finance income/(costs)** | **979** | **1632** | **392** | **18** | **(246870)** | **249675** | **5826** |
| **NET INCOME/(LOSS) BEFORE TAX** | **14294** | **(10042)** | **(1908)** | **(5503)** | **(255444)** | **249675** | **(8928)** |
| Income tax benefit/(expense) | (1500) | (8) | 187 | 15 | 7819 | - | **6513** |
| **NET INCOME/(LOSS) FOR THE YEAR** | **12794** | **(10050)** | **(1721)** | **(5488)** | **(247625)** | **249675** | **(2415)** |
| Attributable to equity holders of the Company | 12794 | (10052) | (1721) | (5488) | (247625) | 249675 | **(2417)** |
| Attributable to non-controlling interests |  | 2 |  |  |  |  | **2** |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2022** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Codere<br> Online** |
| **Revenue** | **60043** | **45518** | **7007** | **3179** | **56310** | **(56310)** | **115747** |
| Personnel expenses | (559) | (1184) | (178) | (875) | (12505) |  | **(15301)** |
| Depreciation and amortization | (51) | (21) | (4) | (125) | (355) |  | **(556)** |
| Other operating expenses | (53521) | (74074) | (14315) | (9383) | (60770) | 56298 | **(155765)** |
| **Operating expenses** | **(54131)** | **(75279)** | **(14497)** | **(10383)** | **(73630)** | **56298** | **(171622)** |
| **OPERATING INCOME/(LOSS)** | **5912** | **(29761)** | **(7490)** | **(7204)** | **(17320)** | **(12)** | **(55875)** |
| Finance income | 256 | 3366 | 1477 | 1344 | 25327 | (6667) | **25103** |
| Finance costs | (1) | (2724) | (1776) | 290 | (57385) | 48953 | **(12643)** |
| **Net finance income/(costs)** | **255** | **642** | **(299)** | **1634** | **(32058)** | **42286** | **12460** |
| **NET INCOME/(LOSS) BEFORE TAX** | **6167** | **(29119)** | **(7789)** | **(5570)** | **(49378)** | **42274** | **(43415)** |
| Income tax benefit/(expense) | (576) | 10 | (4) | (4) | (2406) | 12 | **(2968)** |
| **NET INCOME/(LOSS) FOR THE YEAR** | **5591** | **(29109)** | **(7793)** | **(5574)** | **(51784)** | **42286** | **(46383)** |
| Attributable to equity holders of the Company | 5591 | (29108) | (7793) | (5574) | (51784) | 42286 | **(46382)** |
| Attributable to non-controlling interests |  | (1) |  |  |  |  | **(1)** |

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The following tables break down certain of the information presented in the consolidated statements of financial position as of December 31, 2024 and 2023 by Codere Online's operating segments (amounts expressed in thousands of euros).

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2024** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Codere<br> Online** |
| **Non-current assets** | **709** | **31** | **11** | **69** | **220495** | **(209698)** | **11617** |
| **Current assets** | **72540** | **15408** | **5501** | **4675** | **104118** | **(139319)** | **62923** |
| Trade receivables and other current assets | 13403 | 3672 | 684 | 773 | 39739 | (49149) | 9122 |
| Current financial assets | 46819 | 2915 | 1649 | 1042 | 51209 | (90140) | 13494 |
| Cash and cash equivalents | 12318 | 8821 | 3168 | 2860 | 13170 | (30) | 40307 |
| **Total Assets** | **73249** | **15439** | **5512** | **4744** | **324613** | **(349017)** | **74540** |
| **EQUITY** | **48448** | **(21134)** | **3816** | **(15283)** | **218341** | **(209968)** | **24220** |
| **NON-CURRENT LIABILITIES** | **-** | **-** | **-** | **(3)** | **5359** | **2** | **5358** |
| **CURRENT LIABILITIES** | **24801** | **36573** | **1696** | **20030** | **100913** | **(139051)** | **44962** |
| Lease obligations | 350 |  |  |  | 14 |  | 364 |
| Borrowings | 5921 | 3329 | 283 | 12948 | 72925 | (92041) | 3365 |
| Trade payables and other current liabilities | 18530 | 33244 | 1413 | 7082 | 27974 | (47010) | 41233 |
| **Total EQUITY AND LIABILITIES** | **73249** | **15439** | **5512** | **4744** | **324613** | **(349017)** | **74540** |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2023** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Codere<br> Online** |
| **Non-current assets** | **251** | **59** | **8** | **43** | **125944** | **(117786)** | **8519** |
| **Current assets** | **57153** | **11027** | **4006** | **4472** | **164282** | **(175660)** | **65280** |
| Trade receivables and other current assets | 14666 | 1537 | 656 | 1552 | 55899 | (60706) | **13604** |
| Current financial assets | 31689 | 2744 | 1565 | 920 | 88403 | (114923) | **10398** |
| Cash and cash equivalents | 10798 | 6746 | 1785 | 2000 | 19980 | (31) | **41278** |
| **Total Assets** | **57404** | **11086** | **4014** | **4515** | **290226** | **(293446)** | **73799** |
| **EQUITY** | **32959** | **(18372)** | **(558)** | **(9014)** | **134329** | **(118058)** | **21286** |
| **NON-CURRENT LIABILITIES** | **-** | **-** | **-** | **-** | **408** | **-** | **408** |
| **CURRENT LIABILITIES** | **24445** | **29458** | **4572** | **13529** | **155489** | **(175388)** | **52105** |
| Borrowings | 2247 | 3288 | 1490 | 9108 | 135140 | (146168) | **5105** |
| Trade payables and other current liabilities | 22198 | 26170 | 3082 | 4421 | 20349 | (29220) | **47000** |
| **Total EQUITY AND LIABILITIES** | **57404** | **11086** | **4014** | **4515** | **290226** | **(293446)** | **73799** |

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Codere Online does not have any customers that individually account for 10% or more of its interest and income for the years ended December 31, 2024 and 2023.

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**5.**  **<u>INTANGIBLE ASSETS</u>** 

The table below reconciles the carrying amounts of "Intangible assets" at the beginning and end of the reporting periods:

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| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2023** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2024** |
| Software | 4409 |  | - | 4409 |
| **Total Cost** | **4409** |  | **-** | **4409** |
| ***Accumulated amortization (Note 14)*** |  |  |  |  |
| Software | (4399) |  | (10) | (4409) |
| **Total Amortization** | **(4399)** |  | **(10)** | **(4409)** |
| **Total Carrying amount** | **10** |  | **(10)** | **-** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2022** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2023** |
| Software | 4409 |  |  | 4409 |
| **Total Cost** | **4409** |  |  | **4409** |
| ***Accumulated amortization (Note 14)*** |  |  |  |  |
| Software | **(4399)** |  |  | **(4399)** |
| **Total Amortization** | **(4399)** |  |  | **(4399)** |
| **Total Carrying amount** | **10** |  |  | **10** |

---

[**Table of Contents**](#toc)

**6.**  **<u>PROPERTY, PLANT AND EQUIPMENT</u>** 

The reconciliation of the carrying amounts of the items comprising "Property, plant and equipment" at the beginning and end of the reporting period is set forth below:

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2023** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2024** |
| Machinery and equipment | 639 | 248 | (53) | 834 |
| Other fixtures, fittings and tools | 10 | - | - | 10 |
| **Total** | **649** | **248** | **(53)** | **844** |
| ***Accumulated depreciation (Note 14)*** |  |  |  |  |
| Machinery and equipment | (314) | (126) | 53 | (387) |
| Other fixtures, fittings and tools | (4) | - | - | (4) |
| **Total** | **(318)** | **(126** | **53** | **(391)** |
| **Carrying amount** | **331** | **122** | **-** | **453** |

---

\* The difference between the depreciation expense disclosed in Note 6 and Note 14 arises from using different FX rates: year-end rates for balance sheet and average rates for income statement.

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2022** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2023** |
| Machinery and equipment | 394 | 245 |  | 639 |
| Other fixtures, fittings and tools | 10 | - |  | 10 |
| **Total** | **404** | **245** |  | **649** |
| ***Accumulated depreciation (Note 14)*** |  |  |  |  |
| Machinery and equipment | (200) | (114) |  | (314) |
| Other fixtures, fittings and tools | (4) | - |  | (4) |
| **Total** | **(204)** | **(114)** |  | **(318)** |
| **Carrying amount** | **200** | **131** |  | **331** |

---

[**Table of Contents**](#toc)

**7.**  **<u>LEASES</u>** 

The Group applies IFRS 16 to recognize, measure, present, and disclose leases. Under IFRS 16, Codere Online recognizes right-of-use assets and lease liabilities for all lease contracts, except for short-term leases (defined as leases with a term of 12 months or less) and low-value leases.

During 2024, the Group recognized several lease agreements under IFRS 16, including office and vehicle leases. These agreements vary in lease terms, jurisdictions, and conditions, and are assessed individually in accordance with IFRS 16 requirements. In particular, the new agreement for the Group's main office in Israel established a defined non-cancellable lease term of 64 months, running from July 2024 to October 2029, with a monthly rent of ILS 123 thousand. This lease is now recognized under IFRS 16 in the consolidated financial statements.

Other active lease contracts recognized under IFRS 16 during the period include:

- A new office lease in Melilla, which replaced a previous contract terminated early in 2024. The new lease became effective after a 6-month grace period related to refurbishment works.

- Four vehicle lease contracts signed in 2024, replacing internal service arrangements previously in place within the Group. These new contracts are assessed under IFRS 16 based on the lease terms specified in each agreement.

Below is a summary table with details of the three lease contracts:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| ****<br>**Category** | <br>**Lessee** | <br>**Country** | <br>**CCY** | <br>**Start date** | <br>**End date** |<br>**Lease duration *(months)*** |<br>**Rent**<br> **Amount<br> (Monthly)**<br> **(EUR)<sup>(\*)</sup>** |
| Main Israel office lease (unit n2) | Kudra Israel Marketing (IMSS) | Israel | ILS | 01/07/24 | 28/10/29 | 64 | 32400 |
| Melilla Office | Codere Online, S.A.U. (CDON) | Spain | EUR | 19/04/2024 | 19/04/2028 | 48 | 10000 |
| Vehicles leasing | Servicios de Juego Online S.A.U. (SEJO) | Spain | EUR | 01/2024 - 04/2024 | 03/2028 - 01/2029 | 51-58 | 594 - 740 |

---

*\** These figures are not presented in thousands of euros.

<u>Right-of-Use Assets</u>

The reconciliation of the carrying amounts of the items comprising "Right of use assets" at the beginning and end of the reporting period is set forth below:

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2023** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2024** |
| Right of use assets |  | 2200 |  | 2200 |
| **Total** |  | **2200** |  | **2200** |
| ***Accumulated depreciation (Note 14)*** |  |  |  |  |
| Right of use assets |  | (242) |  | (242) |
| **Total** |  | **(242)** |  | **(242)** |
| **Carrying amount** |  | **1958** |  | **1958** |

---

[**Table of Contents**](#toc)

<u>Lease Liabilities</u>

The lease liabilities as of December 31, 2024, amounted to €2,002 thousand. The maturity analysis is as follows:

---

| | |
|:---|:---|
| ***Maturity Analysis:*** | <br>**12/31/2024** |
| *Year 1* | *540* |
| *Year 2* | *540* |
| *Year 3* | *540* |
| *Year 4* | *450* |
| *Year 5* | *322* |
| *Onwards* | *-* |
| **Total future lease payments** | **2392** |
| &nbsp;&nbsp;&nbsp;*Less: unearned interest* | *(390)* |
| **Lease Liabilities as of December 31, 2024** | **2002** |
| *Analyses as:* |  |
| &nbsp;&nbsp;&nbsp;*Non-Current* | *1638* |
| &nbsp;&nbsp;&nbsp;*Current* | *364* |

---

<u>Lease Expenses and cash outflow</u>

For the year ended 31 December 2024, Codere Online recognized the following lease-related expenses in the statement of profit or loss:

---

| | |
|:---|:---|
|  | **12/31/2024** |
| Depreciation of right-of-use assets | (242) |
| Lease Finance Interest | (105) |
| Operating expenses (short term and low-value leases) | (234) |
| **Total** | **(581)** |

---

The total cash outflow for leases amount to €0.3 million (nil in 2023).

<u>Commitments and Future Lease Arrangements</u>

The Group has entered into the new office lease agreement that has not started as of December 31, 2024. This agreement commences in January 2025 and will be recognized in accordance with IFRS 16.

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **** |  |  |  |  |  | | |
| **Category** | **Lessee** | **Country** | **CCY** | **Start date** | **End date** | **Lease duration (months)** | **Rent**<br> **Amount<br> (Monthly)**<br> **(EUR)<sup>(\*)</sup>** |
| Israel office additional lease (unit n3) | Kudra Israel Marketing (IMSS) | Israel | ILS | 01/01/2025 | 28/10/2029 | 58 | 6427 |

---

\* These figures are not presented in thousands of euros.

[**Table of Contents**](#toc)

**8.**  **<u>FINANCIAL ASSETS</u>** 

The breakdown of the carrying amount of the items presented under financial assets at December 31, 2024 and 2023 is as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2024** | ***Debt Instruments*** |<br>**Carrying Amount** |<br>**Fair Value** |
| **Current financial assets:** | **62923** | **62923** | **62923** |
| Trade receivables and other current assets (Note 9) | 9122 | 9122 | 9122 |
| Current financial assets | 13494 | 13494 | 13494 |
| Cash and cash equivalents | 40307 | 40307 | 40307 |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2023** | ***Debt Instruments*** |<br>**Carrying Amount** |<br>**Fair Value** |
| **Current financial assets:** | **65280** | **65280** | **65280** |
| Trade receivables and other current assets (Note 9) | 13604 | 13604 | 13604 |
| Current financial assets | 10398 | 10398 | 10398 |
| Cash and cash equivalents | 41278 | 41278 | 41278 |

---

Cash and cash equivalents also include reserved cash related to customers in certain jurisdictions (Spain, Colombia and the City of Buenos Aires) where regulations require the Company to maintain cash reserves equal to the amount of customer monies held in their virtual wallets. As of December 31, 2024 and 2023 reserved cash amounted to €4,899 and €5,150 thousand, respectively.

Trade receivables and other current assets include deposits made by customers through retail sport betting terminals, owned by other entities of Codere Group, to their virtual wallets amounting to €2,249 and €1,445 thousand as of December 31, 2024 and 2023, respectively.

Current financial assets mainly correspond to "in transit" deposits made by customers through payment service providers to their virtual wallets and amounted to €11,658 and €9,905 thousand euros as of December 31, 2024 and 2023, respectively. These deposits are normally settled and appear in the Company´s bank account between one to fifteen days after the transaction, depending on each payment service provider and are recognized as current financial assets.

The expected credit losses recognized on current financial assets as of December 31, 2024 and 2023 amounted to €138 and €138 thousand, respectively.

[**Table of Contents**](#toc)

**9.**  **<u>TRADE RECEIVABLES AND OTHER CURRENT ASSETS</u>** 

The breakdown of the items presented under this heading at December 31, 2024 and 2023 is as follows:

---

| | | |
|:---|:---|:---|
| **** |  |  |
|  | **12/31/2024** | **12/31/2023** |
| **Trade receivables:** |  |  |
| Other receivables from the Codere Group companies (Note 15) | 1149 | 8147 |
| Impairment of trade receivables | (99) | (99) |
| **Other current assets:** |  |  |
| Current tax asset (VAT) | 5150 | 5169 |
| Prepayments | 2197 | 414 |
| Other receivables | 725 | (27) |
| **Total** | **9122** | **13604** |

---

Other receivables from the Codere Group companies mainly include balances to be paid by Codere Colombia, S.A. amounting to €654 thousand as of December 31, 2024. Other receivables from the Codere Group companies mainly include balances to be paid by Codere Newco S.A.U. and Codere Apuestas España S.L. amounting to €5,795 thousand as of December 31, 2023.

The carrying amounts of Codere Online's trade receivables and other current assets are denominated in the following currencies:

---

| | | |
|:---|:---|:---|
| ***Currency*** | **12/31/2024** | **12/31/2023** |
| EUR | 3524 | 9847 |
| ILS | 470 | 219 |
| ARS | 590 | 633 |
| USD | 183 | 712 |
| MXN | 3672 | 1537 |
| COP | 683 | 656 |
| **Total** | **9122** | **13604** |

---

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. Codere Online does not hold any collateral as security.

The movement in the allowance for impairment of trade receivables as of December 31, 2024, 2023 and 2022 is as follows:

---

| | |
|:---|:---|
| **Expected credit loss as of 12/31/2022** | **99** |
| Additions |  |
| Reversal |  |
| **Expected credit loss as of 12/31/2023** | **99** |
| Additions |  |
| Reversal |  |
| **Expected credit loss as of 12/31/2024** | **99** |

---

[**Table of Contents**](#toc)

**10.**  **<u>EQUITY</u>** 

On January 24 and March 29, 2023, the Board of Directors approved the creation and issuance of 99,664 and 76,280 new shares with a nominal value of one euro each (€1.00), all fully paid up by the capitalization of part of the available reserve of the company. This issuance was made in accordance with the terms of the invitation letter signed by the subscribers of the management incentive plan. Refer to Note 18 for further details of these plans.

On January 4, 2024, the Board of Directors approved the creation and issuance of 193,275 new shares with a nominal value of one euro each (€1.00), all fully paid up by the capitalization of part of the available reserve of the company. This issuance was made in accordance with the terms of the invitation letter signed by the subscribers of the management incentive plan. As of December 31, 2024, the authorized capital of Codere Online amounts to €499,630,781 divided into 499,630,781 Ordinary Shares with a nominal value of €1.00 each.

See the table below for a summary of ownership of the Company's outstanding ordinary shares as of December 31, 2024:

---

| | | |
|:---|:---|:---|
|  | **Shares** | **Percentage** |
| Ordinary shares held by CNEW | 30000000 | 65.95% |
| Other shareholders | 15491175 | 34.05% |
| **Ordinary shares outstanding** | 45491175 | 100% |

---

**Other reserves**

The Employee share-based compensation reserve is used to recognise the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 18 for further details of these plans. During the years ended December 31, 2024 and 2023 the movement of the Employee share-based compensation in Other reserves, amounted to €1,858 thousand and €2,246 thousand respectively.

As of December 31, 2022 the Other movements allocated in Other reserves that amounted to €898 thousand correspond to an adjustment that reflects the forgiveness of the Cost of Doing Business debt from Codere Group to Codere Online in 2022.In connection with the closing of the Maltese companies, Codere Online transferred its remaining debt with SEJO and the latter entered into a debt cancellation agreement with CNEW on June 30, 2023, whereby CNEW effectively cancelled the amount owed. The debt amount forgiven of €310 thousand was credited to Other reserves as of December 31, 2023.

**Equity attributable to non-controlling interest**

As of December 31, 2024 and December 31, 2023, equity attributable to non-controlling interest amounted to €149 and €147 thousand, respectively, which represents 25% of minority shareholder's interest in the historical online business activity Codere Online has carried out through Hipica de Panama S.A. until October 1, 2021. From December 31, 2021, Panama is 100% controlled by the Company. Currently, the only entity that is not 100% controlled by the Company is LIFO AenP (Mexico), in which it has the 99.99% of the ownership.

[**Table of Contents**](#toc)

**11.**  **<u>BORROWINGS AND NON-CURRENT FINANCIAL LIABILITIES</u>** 

As of December 31, 2024, and 2023 the breakdown of financial instruments by category is as follows:

<u>Current borrowings at amortized cost</u>

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2024** | ***Debt Instruments*** |<br>**Carrying Amount** |<br>**Fair Value** |
| **Current financial liabilities** | **3365** | **3365** | **3365** |
| Other borrowings | 3365 | 3365 | 3365 |
| &nbsp;&nbsp;&nbsp; *Of which:<br> with related parties (Note 15)*  | *3365* | *3365* | *3365* |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2023** | ***Debt Instruments*** |<br>**Carrying Amount** |<br>**Fair Value** |
| **Current financial liabilities** | **5105** | **5105** | **5105** |
| Other borrowings | 5105 | 5105 | 5105 |
| &nbsp;&nbsp;&nbsp; *Of which:<br> with related parties (Note 15)*  | *5105* | *5105* | *5105* |

---

Other borrowings correspond to short-term loans, mainly composed of debt with entities from the Codere Group and amounted to €3,365 and €5,105 thousand as of December 31, 2024 and 2023, respectively.

<u>Non-current borrowings at amortized cost</u>

There were no non-current borrowings accounted for at amortized cost as of December 31, 2024 and December 31, 2023.

The breakdown of the residual maturity contractual undiscounted cash flows of the borrowings of Codere Online as of December 31, 2024 and 2023, was as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **Non-current** | **Non-current** | **Non-current** | **Non-current** | **Non-current** | | |
| **December 31, 2024** | **Current<br> 2025** | **2026** | **2027** | **2028** | **2029** | **Subsequent<br> years** | **Non-current** | **Total** |
| Other borrowings | 3365 |  |  |  |  |  |  | 3365 |
| &nbsp;&nbsp;&nbsp; *Of which: <br> to related parties (Note 15)* | *3365* |  |  |  |  |  |  | *3365* |
| **Total** | **3365** |  |  |  |  |  |  | **3365** |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **Non-current** | **Non-current** | **Non-current** | **Non-current** | **Non-current** | | |
| **December 31, 2023** | **Current<br> 2024** | **2025** | **2026** | **2027** | **2028** | **Subsequent<br> years** | **Non-current** | **Total** |
| Other borrowings | *5105* |  |  |  |  |  |  | *5105* |
| &nbsp;&nbsp;&nbsp; *Of which:<br> to related parties (Note 15)* | **5105** |  |  |  |  |  |  | **5105** |
| **Total** | 5105 |  |  |  |  |  |  | 5105 |

---

[**Table of Contents**](#toc)

**Financial liabilities associated with financing activities**

The following tables present details regarding the changes in financial liabilities as of December 31, 2024 and 2023 that arose from financial activities:

**2024**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | <br>**Balance at<br> 12/31/2023** | <br>**Cash addition** | <br>**Related parties debt restructuring** | <br>**Related party<br> non-ca** | <br>**Related party<br> cash settlement** | <br>**Exchange rate<br> impact** | <br>**Changes in<br> fair value** | <br>**Balance at<br> 12/31/2024** |
| Other borrowings | 5105 |  |  |  | (1740) |  |  | 3365 |
| **Total** | **5105** |  |  |  | (1740) |  |  | **3365** |

---

**2023**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Balance at<br> 12/31/2022** | **Cash addition** | **Related parties debt restructuring** | **Related party<br> non-ca** | **Related party<br> non-cash settlement** | **Exchange rate<br> impact** | **Changes in<br> fair value** | **Balance at<br> 12/31/2023** |
| Other borrowings | 4243 | 1330 |  |  | (468) |  |  | 5105 |
| **Total** | **4243** | **1330** |  |  | **(468)** |  |  | **5105** |

---

<u>Non-current financial liabilities</u>

As of December 31, 2024 and 2023, non-current financial liabilities included warrants accounted for as liabilities. The fair value of the warrants was derived from quoted prices (Level 1).

The warrants represent rights to purchase Ordinary Shares of Codere Online under pre-established terms. As of December 31, 2024, total warrants outstanding were 6,435,000.

These rights were converted into Codere Online warrants following the merger with DD3, maintaining the conditions outlined in the Warrant Amendment Agreement entered into in connection with the Merger.

As of December 31, 2024 and 2023, the market priced increased to approximately €0.58 per warrant; therefore, as of December 31, 2024, the fair value of the warrant liabilities amounted to €3.7 million and €0.4 million, respectively. The change in fair value of the warrants is reported in the consolidated statements of operations as finance cost amounting to €3,310 thousand and as a finance income amounting to €890 thousand for the years ended December 31, 2024 and 2023, respectively.

[**Table of Contents**](#toc)

**12.**  **<u>TRADE PAYABLES AND OTHER CURRENT LIABILITIES</u>** 

The composition of trade payables and other current liabilities as of December 31, 2024 and 2023 is as follows:

---

| | | |
|:---|:---|:---|
|  | **12/31/2024** | **12/31/2023** |
| Trade payables | 24552 | 31812 |
| Customer online wallets | 8697 | 7582 |
| Other current liabilities | 7211 | 6856 |
| Accruals | 773 | 750 |
| **Total** | **41233** | **47000** |
| &nbsp;&nbsp;&nbsp; *Of which:<br> with related parties (Note 15)*  | *3958* | *9670* |

---

The customer virtual wallets are the net difference between funds deposited by customers, plus winning wagers, less losing wagers and less customers withdrawals.

Accruals include the Codere Online's commitments to its staff under the labor legislation prevailing in each market as well as the labor contingencies recognized in each reporting period.

The details of other current liabilities as of December 31, 2024 and 2023 is as follows:

---

| | | |
|:---|:---|:---|
|  | **12/31/2024** | **12/31/2023** |
| Accrued salaries | 1744 | 1372 |
| Current tax liabilities | 5459 | 5478 |
| Others | 8 | 6 |
| **Total** | **7211** | **6856** |

---

[**Table of Contents**](#toc)

**13.**  **<u>INCOME TAX MATTERS</u>** 

Each of the entities included in Codere Online file income taxes according to the tax regulations in force in each country on an individual basis or under consolidation tax regulations.

The consolidated income tax has been calculated as an aggregation of income tax expenses of each individual company. In order to calculate the taxable income of the consolidated entities individually, the accounting profit is adjusted for permanent differences. At each consolidated statements of financial position date, a current tax asset or liability is recorded, representing income taxes currently refundable or payable.

Income tax payable is the result of applying the applicable tax rate in force to each tax-paying entity, in accordance with the tax laws in force in the country in which the entity is registered.

On December 15, 2022, the European Council Commission approved Directive 2022/2523 establishing a minimum level of taxation for large national and multinational corporate groups. The objective of this regulation, which is applicable since 2024, is that large corporate groups pay taxes in all jurisdictions in which they operate at a minimum rate of 15%. The Directive has been transposed into the Spanish legal system by Law 7/2024, being its implementation subject to the issuance of further regulation. Likewise, Luxembourg have already implemented the Pillar 2 regulations, however, it is still uncertain whether this regulation will be implemented locally in other countries where the Codere Group is located, such as Mexico, Colombia, Argentina, Italy or Panama.

Since the Codere Group may fall within the scope of this new tax, an assessment is currently underway to determine its potential impact. This evaluation, currently being performed by Codere Group based on the latest Country-by-Country Report and 2024 financial data, is ongoing and includes consideration of a potential exemption for listed subsidiaries under Pillar Two. At this stage, it remains uncertain whether a top-up tax will be due and which entity, if any, would be liable under the rule.

**Reconciliation of book net income/(loss) before taxes to taxable income**

The reconciliation between book net income/(loss) before tax and the income tax benefit/(expense) from continuing operations for the fiscal years ended December 31, 2024, 2023 and 2022 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| **Net loss before tax** | **5372** | **(8928)** | **(43415)** |
| At Codere Online statutory income tax rate | (913) | 1518 | 7381 |
| Tax effect of unrecognized tax losses and permanent differences | 2783 | 4119 | (19486) |
| Recognition of previously unrecognised tax losses |  | 854 |  |
| Utilization or reversal of previously unrecognized tax losses | (854) |  |  |
| Effect of different rates in different jurisdictions | (2478) | 22 | 9137 |
| **Income tax benefit/(expense)** | **(1462)** | **6513** | **(2968)** |
| Effective tax rate | (27)% | (73)% | 7% |
| *Of which -* |  |  |  |
| Current tax expense | (2491) | (1604) | (3029) |
| Deferred tax benefit/(expense) | 1029 | 8117 | 61 |
| **Total income tax benefit/(expense)** | **(1462)** | **6513** | **(2968)** |

---

[**Table of Contents**](#toc)

**Deferred taxes**

The deferred tax assets and liabilities relate to the following items:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **12/31/2022** | **Recognized in profit or loss** | **12/31/2023** | **Recognized in profit or loss** | **12/31/2024** |
| **Deferred tax assets** |  |  |  |  |  |
| Limitation on deductibility of Spanish CIT | 771 | 7407 | 8178 | 1029 | 9207 |
| Limitation on deductibility of Spanish CIT |  | 5986 | 5986 | 1100 | 7086 |
| Limitation on deductibility of Spanish CIT - reversals |  |  |  | (642) | (642) |
| Tax losses carried forward |  | 854 | 854 | (854) |  |
| Financial expenses deductibility |  |  |  | 925 | 925 |
| Share-based payments | 771 | 567 | 1338 | 500 | 1838 |
| **Deferred tax liabilities** | **(710)** | **710** | **-** | **-** | **-** |
| Exchange differences | (710) | 710 |  |  |  |

---

The 2022 deferred tax liability generated due to the fluctuation of the exchange rates between the euro and the other currencies.

As shown in the table below, the Group has generated net losses which can offset against future profits; however, as of December 31, 2024, the Group did not recognize these considering it is not expected that these will be utilized within the foreseeable future. There is no limit on time in either country to utilize these losses against future profits.

---

| | | |
|:---|:---|:---|
| **Entity** | **Total as of<br> 12/31/2024** | **Total as of<br> 12/31/2023** |
| SEJO | 22865 | 24172 |
| Codere Online S.A.U. (Spain) | - | 1923 |
| LIFO AenP (Mexico) | 34072 | 31409 |
| Codere Online Colombia | 6368 | 7923 |
| Codere Online US Corp | 6752 | 6752 |
| Codere Online Luxembourg | 242564 | 243063 |

---

[**Table of Contents**](#toc)

**14.**  **<u>REVENUE AND EXPENSES</u>** 

**Revenue**

The breakdown of Codere Online's revenues is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Online sports betting | 83408 | 72176 | 58470 |
| Online casino wagering | 117245 | 89461 | 57277 |
| Others | 51 | 10 | - |
| **Total** | **200704** | **161647** | **115747** |

---

No customer contributed more than 10% of revenue for the years ended December 31, 2024, 2023 and 2022.

Additionally, the distribution of sales by geographical market during the reporting period is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Spain | 87778 | 75669 | 60043 |
| Mexico | 95699 | 73315 | 45518 |
| Colombia | 10629 | 8581 | 7007 |
| Argentina | 3499 | 1721 | 1077 |
| Others | 3099 | 2361 | 2102 |
| **Total** | **200704** | **161647** | **115747** |

---

**Personnel expenses**

The heading personnel expenses for the 2024, 2023 and 2022 periods include expenses for wages, salaries, long term incentive plans, benefits (and other similar concepts) and social security and other social contributions expenses payable by Codere Online.

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Wages, salaries and similar | 11671 | 11374 | 9363 |
| Social security contributions payable by Codere Online | 1673 | 1239 | 790 |
| Other social contributions | 5440 | 4824 | 5148 |
| **Total** | **18784** | **17437** | **15301** |

---

Other social contribution includes those expenses resulting from the LTIP executive bonus. As of December 31, 2024 and 2023 it amounted to €1,858 and €2,246 thousand, respectively.

**Depreciation and amortization**

The breakdown of depreciation and amortization for the years ended December 31, 2024, 2023 and 2022 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Depreciation of property, plant and equipment (Note 6) | 136 | 114 | 80 |
| Amortization of intangible assets (Note 5) | 10 |  | 476 |
| Amortization of right-of-use assets | 242 | - | - |
| **Total** | **388** | **114** | **556** |

---

The depreciation and amortization increase is mainly due to the amortization of right-of-use assets, caused by the impact of IFRS 16 (Note 7).

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**Other operating expenses**

The breakdown of other operating expenses for the years ended December 31, 2024, 2023 and 2022 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Gambling taxes | 19863 | 16281 | 11529 |
| Leases | 234 | 528 | 526 |
| Utilities, repairs and maintenance | 1060 | 1432 | 1059 |
| Professional services and other expenses | 62957 | 59203 | 49396 |
| Casino license royalties | 7732 | 6279 | 4843 |
| Marketing expenses | 85355 | 75127 | 88412 |
| **Total** | **177201** | **158850** | **155765** |

---

Codere Online recognizes lease payments as an operating expense on a straight-line basis over the term of the lease for the short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value.

Professional services and other expenses in 2024, 2023 and 2022 mainly include: (i) streaming services contracted to external parties offered to our customers as a complement to our sports betting offer, (ii) the payment processing which allow our customers to deposit and withdraw using platforms and (iii) also some of our less popular sports odds hired to external providers. Additionally, this also includes certain other expenses, such as those relating to marketing and customer relationship management (CRM) tools.

**Finance income / (cost), net**

The breakdown of finance income (cost), net for the years ended December 31, 2024, 2023, and 2022 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2023** | **2022** |
| Interest Income/(Expense), net | 603 | 1815 | 88 |
| Exchange rate impact | (6519) | (1618) | 5828 |
| Argentina Hyperinflation Impact | 8990 | 5292 | 2265 |
| Decrease/(Increase) in Fair Value of Public Warrants (note 11) | (3310) | 890 | 4215 |
| Impact of IFRS 9 on accounting for financial instruments, including impairment\* |  |  | (149) |
| Impact of IFRS 16 (note 7) | (105) |  |  |
| Short term investment gain | 1382 | 1020 |  |
| Related parties debt restructuring |  | (1573) |  |
| Others | - | - | 213 |
| **Total** | **1041** | **5826** | **12460** |

---

\* Impact of IFRS 9 on accounting for financial instruments, including impairment is the result of adding, Impairment of trade receivables, Current financial assets and cash equivalents.

Finance income / (cost), net for the years ended December 31, 2024, 2023 and 2022 includes both realized and unrealized foreign exchange gains/(losses) that have been created due to the fluctuation of the exchange rates between the euro and the other currencies, mainly the Mexican peso, the Colombian peso, Argentine peso and the Panamanian balboa, that Codere Online uses in its operations as well as interest income related to Codere Online's outstanding borrowings to related parties.

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**Earnings per share**

Basic earnings per share amounts are calculated by dividing (a) the net income/(loss) for the year attributable to equity holders of the Company by (b) the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net income/(loss) for the year attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares, if any. The effect of restricted shares, warrants, stock options, and deferred payment rights throughout 2023 and 2022 qualified as antidilutive events. In accordance with IAS 33, antidilutive potential ordinary shares, those that would increase earnings per share or decrease the loss per share if included, are disregarded in the calculation of diluted earnings per share. This is due to Codere Online reporting a net loss for the years ended December 31, 2023 and 2022, which results in all such instruments being considered antidilutive. For the year ended December 31, 2024, the Company reported a net profit and evaluated all potential dilutive instruments. As a result, restricted shares have been included in the diluted earnings per share calculation.

As of December 31, 2024, the Company had 45,491,175 issued and outstanding shares.

Both basic and diluted earnings per share attributable to equity holders of Codere Online are calculated based on the following data, in each case for the years ended December 31, 2024, 2023 and 2022:

---

| | | | |
|:---|:---|:---|:---|
|  | **12/31/2024** | **12/31/2023** | **12/31/2022** |
| Net income/ (loss) attributable to the equity holders of the Company | 3908 | (2417) | (46382) |
| Weight average number of shares outstanding: |  |  |  |
| &nbsp;&nbsp;&nbsp;*Basic* | *45482726* | *45273438* | *45121956* |
| &nbsp;&nbsp;&nbsp;*Diluted* | *46068846* | *45273438* | *45121956* |
| **Basic earnings per share (euros)** | **0.09** | **(0.05)** | **(1.03)** |
| **Diluted earnings per share (euros)** | **0.08** | **(0.05)** | **(1.03)** |

---

For the year ended December 31, 2024, as Codere Online reported a net profit for the first time, an evaluation has been performed in accordance with IAS 33 to determine which outstanding financial instruments qualify as dilutive. Based on this assessment, only restricted shares have been considered potential ordinary shares, with a total dilutive effect of 586,120 shares included in the calculation.

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**15.**  **<u>RELATED PARTIES</u>** 

The parties related to Codere Online include, in addition to Codere Group's subsidiaries, associates and jointly controlled entities, if any, Codere Online's key management personnel, as well as all individuals who are related to them by a family relationship, and the entities over which key management personnel may exercise significant influence or control. Balances and transactions between Codere Online and its subsidiaries, which are related parties of Codere Online, have been eliminated in consolidation and are not disclosed in this note. Details of transactions between Codere Online and other related parties are disclosed below.

**2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related parties** | **Relation to Codere Group** | **Finance<br> costs and<br> exchange<br> differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group |  | 3708 | 3708 |
| Codere Newco S.A.U. | Parent of Codere Online | (63) | 14907 | 14844 |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group |  | 2390 | 2390 |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | 119 | 119 |
| Iberargen, SA. | Subsidiary of Codere Group |  | 5061 | 5061 |
| Other retail companies | Subsidiary of Codere Group |  | 751 | 751 |
| Mexico retail companies | Subsidiary of Codere Group |  | 3993 | 3993 |
| Retail Latam | Subsidiary of Codere Group | - | 1118 | 1118 |
| **TOTAL** |  | **(63)** | **32047** | **31984** |

---

**Balance at 12/31/2024**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Related parties** | **Relation to Codere Group** | **Current financial<br> assets (Note 8)** | **Trade receivables<br> (Note 9)** | **Current borrowings<br> (Note 11)** | **Trade payables<br> and other<br> current liabilities<br> (Note 12)** |
| Codere Newco S.A.U. | Parent of Codere Online | 320 |  | 11 | 1035 |
| Codere Apuestas España S.L. (CAES) | Subsidiary of Codere Group |  | 75 |  | 698 |
| Other retail companies | Subsidiary of Codere Group |  | 173 | 175 | 956 |
| Other Latam retail companies | Subsidiary of Codere Group |  | 38 | 1436 | 424 |
| Codere Colombia, S.A. | Subsidiary of Codere Group |  | 654 | 283 | 599 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. | Subsidiary of Codere Group | - | 209 | 1460 | 246 |
| **Total** |  | **320** | **1149** | **3365** | **3958** |

---

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**2023**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related parties** | **Relation to Codere Group** | **Finance<br> costs and<br> exchange differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group |  | 3609 | 3609 |
| Codere Newco S.A.U. | Parent of Codere Online | (157) | 12087 | 11930 |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group |  | 1952 | 1952 |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | 96 | 96 |
| Iberargen, SA. | Subsidiary of Codere Group | 548 | 3212 | 3760 |
| Other retail companies | Subsidiary of Codere Group |  | 755 | 755 |
| Mexico retail companies | Subsidiary of Codere Group |  | 3998 | 3998 |
| Retail Latam | Subsidiary of Codere Group | - | 2903 | 2903 |
| **TOTAL** |  | **391** | **28612** | **29003** |

---

**Balance at 12/31/2023**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related parties** | **Relation to Codere Group** | **Trade receivables<br> (Note 9)** | **Current borrowings<br> (Note 11)** | **Trade payables<br> and other<br> current liabilities<br> (Note 12)** |
| Codere Newco S.A.U. | Parent of Codere Online | 3859 |  | 4626 |
| Codere Apuestas España S.L. (CAES) | Subsidiary of Codere Group | 2011 |  | 2221 |
| Other retail companies | Subsidiary of Codere Group | 935 | 637 | 1272 |
| Other Latam retail companies | Subsidiary of Codere Group | 13 | 2618 | 835 |
| Codere Colombia, S.A. | Subsidiary of Codere Group | 612 | 325 | 425 |
| Alta Cordillera, S.A. / Hípica de Panamá, S.A. | Subsidiary of Codere Group | 717 | 1517 | 291 |
| Other | Member of the Board | - | 8 | - |
| **Total** |  | **8147** | **5105** | **9670** |

---

**2022**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related parties** | **Relation to Codere Group** | **Finance<br> costs and<br> exchange differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group |  | (3645) | (3645) |
| Codere Newco S.A.U. | Parent of Codere Online |  | (9504) | (9423) |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group |  | (1520) | (1520) |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | (162) | (162) |
| Other retail companies | Subsidiary of Codere Group |  | (857) | (857) |
| Mexico retail companies | Subsidiary of Codere Group |  | (3456) | (3456) |
| Retail Latam | Subsidiary of Codere Group |  | (3365) | (3365) |
| **Total** |  |  | **22509** | **22509** |

---

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*Managing Director Services Agreement*

Mr. Edree currently serves as the Company's Director and Executive Vice Chairman of the Board, a role he assumed on March 1, 2023. Prior to that, from January 1, 2022 to March 1, 2023, he served as the Company's Chief Executive Officer. Before January 1, 2022, he held the position of Managing Director and provided services to Codere Online Business as an independent contractor pursuant to a services agreement entered into by Mr. Edree, Novelly Investments Limited, a British Virgin Islands company majority-owned by him ("Novelly"), and Codere Online Business's subsidiary, OMSE, with an effective date as of October 9, 2018 (as amended on November 30, 2020, the "Edree Services Agreement"). Under the Edree Services Agreement, Mr. Edree and Novelly agreed to provide, on an exclusive dedication basis (subject to their right to continue to manage certain identified holdings), certain services in exchange for a fixed annual fee payable by OMSE to Novelly of €250,000, plus a variable annual fee of up to €125,000, depending on the fulfilment of certain objectives each year. A success fee was also payable by OMSE calculated as 8% of the incremental value (as defined in the Edree Services Agreement) that is created at Codere Online, subject to a cap of €10 million, due to the services provided by Novelly. The success fee vested at a rate of 20% per year for two years (and 12% thereafter), being fully vested on the seventh anniversary of the effective date, or earlier upon the consummation of a company sale event (as defined therein). The Edree Services Agreement included a non-compete provision during the term of the agreement and for 18 months thereafter. Such provision excluded any services provided by Mr. Edree and Novelly to the companies set forth on a schedule to such agreement.

On December 31, 2021, the original parties to the Edree Services Agreement and Codere Newco agreed to amend and terminate the Edree Services Agreement ("Addendum No. 2"). Pursuant to Addendum No.2, Codere Newco agreed to become the sole obligor and assume any payment obligations and other obligations of OMSE with respect to the success fee vested up to December 31, 2021 payable to Novelly under the Edree Services Agreement. Addendum No. 2 was subject to the condition that the Company Board ratified the signing of Addendum No. 2 and the Edree Executive Employment Agreement (as defined below) on or before March 31, 2022, which condition was satisfied on February 2, 2022.

*Executive Vice Chairman Employment Agreement and Executive Vice Chairman Israeli Services Agreement*

Mr. Edree served as Chief Executive Officer of the Company pursuant to an executive employment agreement ("contrato laboral de alta dirección") entered into by Mr. Edree and SEJO, dated January 1, 2022, and as amended on March 1, 2023, whereby his position was modified to the one of Director and Executive Vice Chairman of the Company (the "Executive Vice Chairman Employment Agreement"). Under the Edree Executive Employment Agreement, Mr. Edree undertook to provide certain services under the supervision of the Company Board and SEJO's board of directors, on an exclusive dedication basis (subject to Mr Edree's right to continue to manage certain identified entities under certain terms and conditions), for an indefinite term in exchange for a fixed annual salary payable by SEJO of €157,500, plus (i) a variable annual compensation of up to €78,750, depending on the fulfilment of certain objectives each year, (ii) the right to participate in the LTIP, and (iii) the right to indemnification under Codere Online's insurance for directors and senior managers from time to time. The Executive Vice Chairman Employment Agreement includes a non-compete provision during the term of the agreement and for 12 months thereafter (subject to Mr Edree's right to continue to manage certain identified entities under certain terms and conditions) and a non-solicit provision for 24 months after the term of the agreement. As consideration for the non-compete and non-solicit, Mr. Edree will be entitled to receive the equivalent to one fixed annual salary upon termination of the agreement. As part of Mr. Edree's new compensation structure, effective as of June 1, 2024, Mr. Edree was appointed as a remunerated director of CIMSS pursuant to an Israeli services agreement (the "Executive Vice Chairman Israeli Services Agreement"). Under the Executive Vice Chairman Israeli Services Agreement, CIMSS shall pay Mr. Edree a gross fixed annual remuneration of NIS 635,276 + VAT and an annual variable remuneration in an amount of up to 50% of his fixed annual remuneration + VAT, subject to Mr. Edree's achievement of certain pre-established objectives. Additionally, in the framework of Mr. Edree's new compensation structure, SEJO, CIMSS, Parent and Mr. Edree entered

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into an indemnity agreement pursuant to which Mr Edree will indemnify SEJO, CIMSS and Parent with respect to any claims, liabilities, losses, damages, costs or expenses (including reasonable legal expenses and attorney's fees) arising from, or related to, his new compensation structure (the "Executive Vice Chairman Indemnity Agreement"). The maximum aggregate liability of Mr. Edree for any liability arising under or in connection with the Executive Vice Chairman Indemnity Agreement shall be limited to an amount equivalent to the fees actually received by Mr. Edree under the Executive Vice Chairman Employment Agreement and the Executive Vice Chairman Israeli Services Agreement in the twelve months preceding the receipt, by Mr. Edree, of written notice of an indemnifiable loss or a third party claim.

Execution *of Executive Vice Chairman Supplemental Bonus Scheme and Termination of Addendum No. 2 Obligations*

Effective as of May 7, 2024, SEJO, CIMSS, Codere Newco and Mr. Edree entered into a supplemental bonus scheme agreement ("Executive Vice Chairman Supplemental Bonus Scheme") establishing the key terms and conditions of a supplemental bonus scheme for the benefit of Mr. Edree and terminating any payment obligations with respect to the success fee payable to Mr. Edree under Addendum No. 2. The Executive Vice Chairman Supplemental Bonus Scheme is a 3-year incentive plan, comprising calendar years 2024, 2025 and 2026 and the total compensation is subject to a cap of USD 2,500,000. The payout amount under the Executive Vice Chairman Supplemental Bonus Scheme will be determined annually. Codere Newco is liable to pay up to the first 50% of any amounts due under the Executive Vice Chairman Supplemental Bonus Scheme for each calendar year and SEJO and CIMSS are liable to pay up to the second 50% of any amounts due under the Executive Vice Chairman Supplemental Bonus Scheme for each calendar year. Mr. Edree and Novelly agree to release Codere Newco, SEJO, CIMSS, Parent and any of its subsidiaries from time to time from (i) any obligations, payment or otherwise; and (ii) any liability that may arise under Addendum No. 2.

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**16.**  **<u>RISK MANAGEMENT POLICIES</u>** 

● **Key Company Risk** 

The key risks to which Codere Online is exposed are related to the gambling sector. The gambling industry is closely regulated (those regulations extend to the gambling business itself and the gambling formats and channels permitted; management of the risks associated with gambling; gambling advertising; data protection; anti-money laundering; and anti-fraud, among others). Gambling operators are required to fulfil a number of technical and compliance-related obligations in order to operate under licenses that need to be renewed at certain intervals and/or are subject to ongoing oversight. The failure to comply with any of these regulations or requirements or the inability to renew our gambling licenses could have an adverse impact on our business. In addition, new regulations in the future could imply additional restrictions on already-regulated activities that could reduce Codere Online's ability to offer products and services to its customers.

The industry is also exposed to the formulation of new and interpretation of existing gambling tax regulations in every market. Any increase in the gambling tax burden or changes in tax calculation methodologies could affect the viability of Codere Online's business. The gambling industry is often in the spotlight and the public perception of what Codere Online does can also have an adverse impact on its performance. Moreover, regulatory changes in the various markets could pave the way for the entry of new competitors or new gambling formats that could have an adverse impact on Codere Online's business. Lastly, Codere Online is and will remain exposed to inspections and/ lawsuits related with the above-mentioned tax regulations and compliance rules.

Elsewhere, the markets in which Codere Online does business expose it to political, macroeconomic and monetary risks that affect its international operations. The market conditions and social-economic variables in each of Codere Online's markets affect its customers' purchasing power and, by extension, its business performance. Codere Online is also affected by political and monetary risks (including exposure to currency devaluations and changes in company law in our operating markets).

In addition, Codere Online is exposed to the risk that its customers' tastes and preferences could change, as well as the risk that technology could lead to alternative leisure pursuits options. It also faces risks deriving from supplier or competitor concentration in certain formats or products and the ability or inability of the former to create safe gambling products that are attractive to customers and comply with prevailing legislation in one or more markets. Lastly, the impact of technology developments on how the business and product are managed (digitalization and interconnection) implies risks with respect to the integrity of Codere Online's IT systems and platforms which Codere Online needs to manage proactively in order to avoid potential contingencies. Codere Online's financial systems currently rely significantly on human intervention. Codere Online is making an effort to reduce the level of human intervention in the related processes.

Codere Online is exposed to various financial market risks as a result of its ordinary business activities. The main market risks affecting Codere Online are the following:

● **Liquidity risk**: Codere Online is exposed to liquidity risk if a mismatch arises between its financing needs and its sources of financings.

● **Exchange rate risk:** Codere Online is exposed to exchange rate risk because its functional currency is the euro, and the value of financial assets denominated in a currency that is different from Codere Online's functional currency is subject to variations resulting from fluctuations in exchange rates.

● **Credit risk**: Codere Online is exposed to the possibility of a counterparty to an agreement not complying with its contractual obligations, thus negatively affecting results of operations of Codere Online.

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**Market Risk**

As a publicly traded company, Codere Online is exposed to market risks that arise from changes in market prices and rates, including foreign currency exchange rates, interest rates, equity prices, and other factors that affect the capital markets.

Additionally, our company has issued warrants that are also subject to market risk. Adverse changes in these market conditions could have a negative impact on our financial performance and position.

These market risks may impact the financial performance and position of the Company.

**Liquidity risk**

Codere Online is exposed to liquidity risk if a mismatch arises between its financing needs (including operating, financial and investment needs) and its sources of financing (including cash on balance sheet and future cash flows).

**Exchange rate risk**

Exchange rate risk arises when the value of existing assets, liabilities and / or future cash flows are subject to change because of fluctuations in foreign exchange rates. Codere Online's exposure to the risk of changes in foreign exchange rates relates primarily to (i) its operations (certain revenues and expenses being denominated in foreign currencies) and (ii) certain cash balances being held in foreign currencies.

Codere Online actively manages exchange rate risks to control the exposure of balances to foreign currency in order to minimize the risks associated with exchange rate variations and optimizing Codere Online's financial cost.

The following tables include the outstanding current asset and current liability balances in foreign currencies as of December 31, 2024 and 2023 in thousands of euros:

**12/31/2024**

---

| | | |
|:---|:---|:---|
|  | **Current<br> assets** | **Current<br> liabilities** |
| ILS | 969 | 2378 |
| COP | 5501 | 1697 |
| MXN | 15408 | 15440 |
| PAB | 3344 | 2012 |
| ARS | 1331 | 428 |
| USD | - | - |
| **Total** | **26553** | **21955** |

---

**12/31/2023**

---

| | | |
|:---|:---|:---|
|  | **Current<br> assets** | **Current<br> liabilities** |
| ILS | 665 | 784 |
| COP | 4006 | 2036 |
| MXN | 11027 | 17090 |
| PAB | 2678 | 2268 |
| ARS | 1587 | 539 |
| USD | - | - |
| **Total** | **19963** | **22717** |

---

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*Sensitivity analysis*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2024<sup>(\*)</sup>** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 4580.9 | (380) |  | 380 |  |
| MXN/EUR | 21.31 | 3 |  | (3) |  |
| USD/EUR | 1.04 | (1132) |  | 1132 |  |
| ARS/EUR | 1072.14 | (91) |  | 91 |  |
| ILS/EUR | 3.79 | 141 |  | (141) |  |

---

\* These figures are not presented in thousands of euros.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2023<sup>(\*)</sup>** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 4223.37 | (197) |  | 197 |  |
| MXN/EUR | 18.67 | 606 |  | (606) |  |
| USD/EUR | 1.11 | 495 |  | (495) |  |
| ARS/EUR | 893.34 | 192 |  | (192) |  |
| ILS/EUR | 4.01 | 12 |  | (12) |  |

---

\* These figures are not presented in thousands of euros.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity -10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** | **Sensitivity +10%<br> (in thousands of euros)** |
| **Currency** | **Exchange rate<br> 12/31/2022<sup>(\*)</sup>** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 5130.56 | 18 |  | (18) |  |
| MXN/EUR | 20.65 | 938 |  | (938) |  |
| GBP/EUR | 0.88 | 1 |  | (1) |  |
| USD/EUR | 1.07 | 4224 |  | (4224) |  |
| ARS/EUR | 188.96 | 273 |  | (273) |  |
| ILS/EUR | 3.75 | 51 |  | (51) |  |

---

\* These figures are not presented in thousands of euros.

**Credit risk**

Codere Online does not have significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics.

Codere Online does not have significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics.

Codere Online considers a financial asset to be in default when:

- the debtor is unlikely to pay its credit obligations to Codere Online in full, without recourse by Codere Online to actions such as realising security (if any is held)

Impairment provisions are determined on the basis of lifetime expected credit losses, including those expected at the individual level, using reasonable and supportable forward-looking information, based on the best information available at the date of authorizing the financial statements for issue. They are re-estimated at every reporting date on an individual basis, using the following criteria:

- The age of the debt.

- The existence of financial difficulties, including bankruptcy proceedings.

- An analysis of the debtor's ability to repay the loan

As described in Note 3, Codere Online's historical credit loss experience with Group's entities is nil. The expected credit loss is estimated based on external risk parameters, publicly available, such as the probability of default ("PD") of Codere Group and a loss given at default ("LGD") of 100%.

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**17.**  **<u>COMMITMENTS AND CONTINGENCIES</u>** 

Codere Online is faced with certain contingencies, from time to time, involving litigation, claims, assessments or compliance. Such proceedings can be costly, time consuming and unpredictable and, therefore, no assurance can be given that the final outcome of such proceedings will not materially impact Codere Online's financial condition or results of operations. Estimated losses are accrued for these proceedings when the loss is probable and can be estimated. While Codere Online maintains insurance coverage that Codere Online believes is adequate to mitigate the risks of such proceedings, no assurance can be given that the amount or scope of existing insurance coverage will be sufficient to cover losses arising from such matters. The current liability for the estimated losses associated with these proceedings is not material to the consolidated financial condition and those estimated losses are not expected to have a material impact on Codere Online's results of operations.

**18.**  **<u>OTHER INFORMATION</u>** 

**Management Incentive Plan**

On February 2, 2022, the Company Board approved the terms and conditions of a long-term incentive plan (the "LTIP"), which was approved by the Company Shareholders at a meeting held on March 3, 2022. The main objective of the LTIP is to enhance the alignment between senior management and director interests with those of Codere Online and the Company Shareholders and to strengthen the retention and motivation of senior management and directors in the long term.

The LTIP is primarily for the benefit of certain existing and future senior managers of the Company and the Directors and certain employees and independent contractors providing services to Codere Online from time to time. The beneficiaries will be proposed by the Chief Executive Officer of the Company and will be subject to approval by the Company Board. Upon approval by the Company Board, such beneficiaries will receive an invitation letter to participate in the LTIP. Beneficiaries will be required to accept the terms of a post-contractual non-compete and non-solicitation agreement to benefit from the terms of the LTIP.

Compensation under the LTIP will be based on the beneficiary's expected role, responsibilities and contribution to the business of the Company, among other things. The LTIP includes compensation in the form of share options, restricted shares, and/or deferred payments payable depending upon the increase in the Company's equity value and/or deferred payments payable depending upon the Incremental Equity Value (the amount will be determined as soon as possible following year-end 2026). The Incremental Equity Value will be calculated considering the Exercise Equity Value (which will be calculated considering the 2026 Adjusted EBITDA, the Net Financial Debt and the Transaction Value of Codere Online as established in the Company Sale Event), the Base Equity Value (amounting to $350 million) and the Invested Capital from shareholders (cash contributions to shareholders, in each case to the extent made after the date of commencement of this Plan and will be capitalized at an annual rate of 8%).

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According to the LTIP Agreement, the termination date of the restricted shares and deferred payments will be March 31, 2027, whereas the share options will terminate on December 31, 2027. The number of share options to be granted will be based on the portion of the Target Compensation tied to this stock option component, a $10.00 exercise price (the "Strike Price"), the Target Share Price and subject to standard anti-dilution protections and adjustment for extraordinary cash dividends.

The restricted shares, share options and deferred payment rights granted to the beneficiaries shall have a 20% vesting per calendar year, considering the applicable start of vesting period.

Notwithstanding the general 20% per year vesting rule, the following clarifications apply based on employee start dates:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) For grants made after January 1, 2022, where the beneficiary was already employed or providing services as of January 1, 2022, the vesting commencement date is deemed to be January 1, 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) For grants made after January 1, 2022, where the beneficiary joined the Company after January 1, 2022, the vesting schedule is adjusted proportionally to ensure full vesting by December 31, 2026 (i.e., more than 20% per year on average).

The share options will be exercisable at the option of the beneficiary on a cash or cashless basis (subject to the Company´s option to net cash settle to avoid the dilutive impact from any such share option exercise) and will not be transferable by the beneficiary at any time.

The number of restricted shares to be granted will be based on the portion of the Target Compensation tied to the restricted share component and a target share price of $20.50 ("Target Share Price"). The restricted shares may also be net cash settled by the Company to avoid the dilutive impact from the issuance of restricted shares. Share options may be exercised, and restricted shares may be sold, following the later of (i) 90 days from the respective vesting date and (ii) December 31, 2023.

The deferred payments right are also part of the LTIP to enhance the alignment between senior management and directors' interest with those of Codere Online and Holdco Shareholders and to strengthen the retention and motivation of senior management and directors in the long term. Deferred payment are measured in USD and the employee will receive as many shares as are worth to the deferred payment right amount no later than March 31, 2027. The deferred payments right granted to the beneficiaries shall have a 20% vesting per calendar year and will be paid at the Company's option in cash or the Company's Ordinary Shares subject to certain exceptions and acceleration events.

The employer company of each beneficiary will be the one liable for compliance with applicable payroll obligations (income tax withholdings and social security tax withholdings/payments).

The total number of Ordinary Shares issuable to beneficiaries pursuant to the share options and restricted shares shall be limited to 5% of the total number of Ordinary Shares issued and outstanding at the time the LTIP was approved by the Company Shareholders. The Company may increase such limit by an amount equivalent to 0.2% of the total number of Ordinary Shares issued and outstanding on each December 31 through the end of the vesting period of the LTIP, to provide for additional capacity to grant awards to additional beneficiaries under the LTIP.

The total number of share options, restricted shares and deferred payments right to each part of the LTIP is as follow:

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**12/31/2024**

---

| | | | |
|:---|:---|:---|:---|
|  | **Share options** | **Restricted Shares** | **Deferred payments right (USD)** |
| **Total rights as of December 31, 2023** | **1031893** | **787874** | **8813162** |
| Awarded during the period | 15567 | 7974 | 163458 |
| Issued during the period |  | (193275) |  |
| Cash settled during the period |  | (1529) |  |
| Exercised during the period |  |  |  |
| Forfeited during the period | (114227) | (42177) | (73411) |
| **Total rights as of December 31, 2024** | **933233** | **558867** | **8903209** |
| *Vested* | *566326* | *196150* | *5330973* |
| *Unvested* | *366907* | *362717* | *3572236* |

---

**12/31/2023**

---

| | | | |
|:---|:---|:---|:---|
|  | **Share options** | **Restricted Shares** | **Deferred payments right (USD)** |
| **Total rights as of December 31, 2022** | **903955** | **899918** | **8792426** |
| Awarded during the period | 158637 | 81254 | 313242 |
| Issued during the period |  | (175944) |  |
| Cash settled during the period |  | (3084) |  |
| Exercised during the period |  |  |  |
| Forfeited during the period | (30699) | (14270) | (292506) |
| **Total rights as of December 31, 2023** | **1031893** | **787874** | **8813162** |
| *Vested* | *388779* | *194804* | *3530831* |
| *Unvested* | *643114* | *593070* | *5282331* |

---

The fair value of the equity instruments granted has been determined using a Monte Carlo simulation valuation model as of each of the Grant dates, considering the conditions determined in the LTIP Agreement, and the following assumptions:

---

| | |
|:---|:---|
| Forecast share price volatility (annualized) | 49.06% - 49.17% |
| Plan duration (years) | 5.00 |
| Expected dividend yield | 0.00% |
| Risk-free interest rate | U.S. Sovereign Bond yield |

---

Regarding the forecasted share price volatility, given the recent listing of the Company's shares, the annualized share price volatility has been calculated as the average historical standard deviation among the company's selected peers, considering a 5-year period, matching the LTIP tenor.

More specifically, the restricted share's fair value has been calculated as the number of estimated vested instruments times the expected share value at the assumed restricted shares exercise date. The number of estimated vested instruments used has been the one established in each beneficiary's invitation letter, and the expected share value has been determined according to the aforementioned Monte Carlo simulation and the valuation inputs previously detailed.

Regarding the fair value of the stock options which may be converted into the Company's ordinary equity at a previously specified price for a determined time period, has been obtained in a similar way, by multiplying the number of vested stock options times the expected option value as of that date. In this sense, in order to determine the stock option value as of each of the grant dates, we have also used the expected share price evolution as determined by the Monte Carlo simulation model. Additionally, it is worth mentioning that options' value can be divided into intrinsic value, consisting in the difference between the underlying share's price and the option's strike if this is a positive value for the acquirer of the option shares; and time value, which represents the possibility that the option may obtain intrinsic value in the future. In this sense, according to the valuation model's share price expected evolution, the Company's stock options only have time value as of each of the grant dates, due to the value of the underlying ordinary shares as of the grant dates and the strike price of $10.00 per share.

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Finally, it must be noted that the fair value of deferred payments to be made in a future date, depends directly on a non-market condition (evolution of the Company's EBITDA during the Sub-Plan's life). However, it is possible to determine the number of shares to be delivered, based on the expected evolution of the Company's EBITDA in line with its business plan, which may be revised subsequently until the payment date. To this extent, in order to establish the preliminary number of shares which will be delivered to the Sub-Plans' beneficiaries, the main input used has been the Company's business plan.

The incentives granted to the beneficiaries under the LTIP will be subject to a 5-year general vesting period, with 20% vesting per year, subject to certain exceptions and acceleration events, in order to promote the long-term retention of the beneficiaries.

Except in the case of a termination for gross misconduct, fraud or gross negligence, in which case the relevant beneficiary would forfeit all rights to both vested and unvested compensation under the LTIP, beneficiaries that cease to be employed by Codere Online or to provide services to Codere Online, as applicable, will retain all vested compensation up to the date of any such resignation or termination. Awards are subject to recovery by Codere Online under certain events, including as a result of a breach of the post-contractual non-compete or non-solicit or pursuant to applicable laws and regulations. Except as prohibited by applicable laws, the company may extend loans to beneficiaries to pay certain taxes due in connection with compensation under the LTIP.

The LTIP is subject to the Spanish employment law as a significant part of the compensation under the LTIP will be awarded to beneficiaries located in Spain. The components of the LTIP may be subject to special terms and conditions depending on the location of the beneficiary.

The foregoing description of the LTIP does not purport to be complete and is qualified in its entirety by reference to the full text of the LTIP Master Agreement, which has been filed as an exhibit to the annual report of Codere Online as of December 31, 2022.

Codere Online recognises the expense associated with the LTIP using the graded vesting method, in line with IFRS 2:B43–B44. This approach treats each vesting tranche as a separate award with its own fair value, and expense is recognised over the respective vesting periods of each tranche.

For the years ended December 31, 2024 and 2023, the impact of the LTIP was recorded in the consolidated statement of operations and income Statement as personnel expenses amounted to €1,858 thousand and €2,246 thousand, respectively.

**19.**  **<u>EVENTS AFTER THE REPORTING DATE</u>** 

**Repurchases of ordinary shares by Codere Online**

At a general meeting held on March 3, 2025, Codere Online shareholders authorized the repurchase of up to 1 million of the Company's ordinary shares over a one-year period. As of May 28, 2025, Codere Online had repurchased 77,005 shares at an average price of $6.67 under the authorized share buyback plan.

**Compliance with Nasdaq Listing Requirements**

On May 1, 2025, the Company filed its 2023 annual report (ahead of the May 12th deadline), and on May 15, Nasdaq notified the Company that it had regained compliance with applicable listing requirements. As part of this determination, the Company is subject to a mandatory one-year monitoring period.

Given the delay in the filing of the 2024 annual report on Form 20-F, and the fact that the filing did not occur within the 15-day grace period provided by Nasdaq, the Company received on May 16, 2025 a new delisting notice.

Upon receipt of the delisting notice, the Company requested a hearing before the Nasdaq Hearings Panel and sought a stay of any trading suspension. However, by having filed this 2024 annual report on Form 20-F, the Company believes it has regained compliance with Nasdaq listing requirements and that the hearing will not be necessary.

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**Report of Independent Registered Public Accounting Firm**

To the Shareholders and the Board of Directors of

Codere Online Luxembourg, S.A.

Opinion on the Consolidated Carve-out Financial Statements

We have audited the accompanying consolidated statement of financial position as of December 31, 2022 and the consolidated carve-out statement of financial position as of December 31, 2021 of Codere Online Luxembourg, S.A. and subsidiaries (the Company), the related consolidated carve-out income statements and statements of comprehensive income, changes in equity and cash flows for each of the two years in the period ended December 31, 2022, the related consolidated combined carve-out income statement and statement of comprehensive income, changes in equity and cash flow for the year ended December 31, 2020, and the related notes (collectively referred to as the "consolidated carve-out financial statements"). In our opinion, the consolidated carve-out financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with International Financial Reporting Standards issued by the International Accounting Standards Board.

**The Company's Ability to Continue as Going Concern**

The accompanying consolidated carve-out financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 n) to the consolidated carve-out financial statements, the Company is dependent on its controlling shareholder (Codere Group) for the use of the Codere brand, certain gaming licenses, and certain services. Codere Group is currently undergoing a financial restructuring and due to the uncertainties surrounding the outcome of this process, Codere Group's actions could have a significant effect on Company's business, results of operations and financial condition. Management's evaluation of the events and conditions and management's plans regarding this matter are also described in Note 3 n). The consolidated carve-out financial statement statements do not include any adjustments that might result from the outcome of this uncertainty.

**Basis for Opinion**

These consolidated carve-out financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated carve-out financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated carve-out financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated carve-out financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated carve-out financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated carve-out financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Ernst & Young, S.L.

We have served as the Company's auditor since 2016

Madrid, Spain

April 28, 2023

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS OF DECEMBER 31, 2022 AND**

**CONSOLIDATED CARVE-OUT STATEMENT OF FINANCIAL POSITION AS OF DECEMBER 31, 2021**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **Notes** | **12/31/2022** | **12/31/2021** |
| **ASSETS** |  |  |  |
| **A) NON-CURRENT ASSETS** |  | **983** | **606** |
| Intangible assets | 5 | 10 | 469 |
| Property, plant and equipment | 6 | 200 | 133 |
| Non-current financial assets |  | 2 | 4 |
| Deferred tax assets | 12 | 771 | - |
| **B) CURRENT ASSETS** |  | **68325** | **104669** |
| Trade receivables and other current assets | 8 | 7742 | 5862 |
| Current financial assets | 7 | 6775 | 3899 |
| Cash and cash equivalents | 7 | 53808 | 94908 |
| **TOTAL ASSETS (A+B)** |  | **69308** | **105275** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Notes** | **12/31/2022** | **12/31/2021** |
| **EQUITY AND LIABILITIES** |  |  |  |
| **A) EQUITY** | **9** | **24547** | **68154** |
| Equity attributable to equity holders of the Parent |  | 24401 | 68007 |
| Equity attributable to non-controlling interest |  | 146 | 147 |
| **B) NON-CURRENT LIABILITIES** |  | **2008** | **5513** |
| Non-current financial liabilities | 10 | 1298 | 5513 |
| Deferred tax liability | 12 | 710 | - |
| **C) CURRENT LIABILITIES** |  | **42753** | **31608** |
| Borrowings | 10 | 4243 | 2984 |
| Trade payables and other current liabilities | 11 | 38510 | 28624 |
| **TOTAL EQUITY AND LIABILITIES (A+B+C)** |  | **69308** | **105275** |

---

The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED CARVE-OUT INCOME STATEMENT**

**FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021, AND**

**CONSOLIDATED COMBINED CARVE-OUT INCOME STATEMENT**

**FOR THE YEAR ENDED DECEMBER 31, 2020**

**(Thousands of Euros)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Notes** | **2022** | **2021** | **2020** |
| **Revenue** | **13** | **115747** | **80253** | **70497** |
| Personnel expenses |  | (15301) | (7080) | (5157) |
| Depreciation and amortization |  | (556) | (721) | (932) |
| Other operating expenses |  | (155765) | (143481) | (78657) |
| **Operating expenses** | **13** | **(171622)** | **(151282)** | **(84746)** |
| **OPERATING INCOME/(LOSS)** |  | **(55875)** | **(71029)** | **(14249)** |
| Finance income / (costs) | 13 | 12460 | 3982 | (520) |
| **Net financial results** |  | **12460** | **3982** | **(520)** |
| **NET INCOME/(LOSS) BEFORE TAX** |  | **(43415)** | **(67047)** | **(14769)** |
| Income tax benefit/(expense) | 12 | (2968) | (966) | (1510) |
| **NET INCOME/(LOSS) FOR THE YEAR** |  | **(46383)** | **(68013)** | **(16279)** |
| Attributable to equity holders of the Parent |  | (46382) | (68067) | (16274) |
| Attributable to non-controlling interests |  | (1) | 54 | (5) |
| Basic earnings per share attributable to equity holders of the parent (Euro) | 13 | (1.03) | (10.18) | (3.65) |
| Diluted earnings per share attributable to equity holders of the parent (Euro) | 13 | (1.03) | (10.18) | (3.65) |

---

The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED CARVE-OUT STATEMENT OF COMPREHENSIVE INCOME**

**FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 AND**

**CONSOLIDATED COMBINED CARVE-OUT STATEMENT OF COMPREHENSIVE INCOME**

 **FOR THE YEAR ENDED DECEMBER 31, 2020**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| **Net loss for the year** | **(46383)** | **(68013)** | **(16279)** |
| Currency translation differences | (1470) | (1134) | 1109 |
| Income tax impact | - | - | - |
| **Items that may be reclassified subsequently to profit or loss** | **(1470)** | **(1134)** | **1109** |
| **Total other comprehensive income/(loss) recognized in the year** | **(1470)** | **(1134)** | **1109** |
| **Total comprehensive loss recognized in the year** | **(47853)** | **(69147)** | **(15170)** |
| **Attributable to:** |  |  |  |
| Equity holders of the Parent | (47852) | (69201) | (15262) |
| Non-controlling interests | (1) | 54 | 92 |

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The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED CARVE-OUT STATEMENT OF CHANGES IN EQUITY**

**FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 AND**

**CONSOLIDATED COMBINED CARVE-OUT STATEMENT OF CHANGES IN EQUITY**

**FOR THE YEAR ENDED DECEMBER 31, 2020**

**(Thousands of Euros)**

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | | |
|  | **Issued capital** | **Net income / (loss) for the year** | **Retained earnings / (losses)** | **Net Parent investment** | **Other reserves** | **Share premium** | **Other comprehensive income/(loss)** | **Total** |<br>**Non-controlling interest** |<br>**Total Equity** |
| **Balance at January 1, 2020** | **60** | **-** | **(17696)** | **(13634)** | - | - | **(160)** | **(31430)** | **97** | **(31333)** |
| Net income/(loss) for the year |  | (16274) |  |  |  |  |  | (16274) | (5) | **(16279)** |
| Other comprehensive income/(loss) for the year | - | - | - | - | - |  | 1109 | 1109 | - | **1109** |
| **Total comprehensive income/ (loss) for the year** | **-** | **(16274)** | **-** | **-** | - |  | **1109** | **(15165)** | **(5)** | **(15170)** |
| Appropriation of result |  | 16274 | (16274) |  |  |  |  |  |  | **-** |
| Net change in Parent investment | - | - | - | 6578 | - | - | - | 6578 | - | **6578** |
| **Balance at December 31, 2020 (SEJO) (\*)** | **60** | **-** | **(33970)** | **(7056)** | - | - | **949** | **(40017)** | **92** | **(39925)** |
| Net income/(loss) for the year |  | (68067) |  |  |  |  |  | (68067) | 54 | **(68013)** |
| Other comprehensive income/(loss) for the year | - | - | - | - |  | - | (1134) | (1134) | - | **(1134)** |
| **Total comprehensive income/ (loss) for the year** | **60** | **(68067)** | **(33970)** | **(7056)** |  | **-** | **(185)** | **(109218)** | **146** | **(109072)** |
| Elimination of SEJO equity (former holding company) (\*) | (60) |  |  |  | 60 |  |  |  |  | **-** |
| Incorporation of the new Parent at June 4, 2021 (Note 1) | 30 |  |  |  |  |  |  | 30 |  | **30** |
| Reclassification of net Parent investment (Note 9) (\*) |  |  |  | 7056 | (7056) |  |  |  |  | **-** |
| Change in net Parent investment (Note 9) (\*) |  |  |  | 55154 |  |  |  | 55154 |  | **55154** |
| Reclassification to other reserves (Note 9) (\*) |  |  |  | (55154) | 55154 |  |  |  |  | **-** |
| SEJO contribution (Note 9) | 29970 |  |  |  | (29970) |  |  |  |  | **-** |
| DD3 contribution (Note 9) | 15122 | - | - | - | - | 106920 | - | 122042 | - | **122042** |
| **Balance at December 31, 2021 (\*)** | **45122** | **(68067)** | **(33970)** | **-** | **18188** | **106920** | **(185)** | **68008** | **146** | **68154** |

---

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| | |
|:---|:---|
| (\*) | The historical combined carve-out financial statement for the year ended December 31, 2020 was presented based on the former structure of the Codere Online Business prior to the consummation of the Business Combination, where Servicios de Juego Online, S.A.U. ("SEJO") was the holding company until the date of the Business Combination with €60 thousand of issued capital. On November 29, 2021, the Business Combination was completed, and SEJO was contributed to Codere Online Luxembourg, S.A. which became the new Parent Company of the Codere Online Business. Consequently, as of December 31, 2021, the €45,122 thousand of issued capital all corresponds to Codere Online Luxembourg, S.A. and the €60 thousand of issued capital of SEJO has been reclassified to other reserves. The Net Parent Investment balance included the balances that were recorded in the historical combined carve-out financial statements and the transfer of the balance from Net Parent Investment to other reserves occurred as a result of the Business Combination. Additionally, as explained in Note 9, Codere Online capitalized the majority of its outstanding indebtedness with Codere Group. This was initially recorded under the Net Parent Investment heading and as a result of the Business Combination, has been reclassified to other reserves |

---

The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED CARVE-OUT STATEMENT OF CHANGES IN EQUITY**

**FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 AND**

**CONSOLIDATED COMBINED CARVE-OUT STATEMENT OF CHANGES IN EQUITY**

**FOR THE YEAR ENDED DECEMBER 31, 2020**

**(Thousands of Euros)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | **Attributable to equity holders of the Parent (Codere Online Luxembourg S.A.)** | |
|  | **Issued capital** | **Net income / (loss) for the year** | **Retained earnings / (losses)** | **Other reserves** | **Share premium** | **Other comprehensive income/(loss)** | **Total** | **Non-controlling interest** |<br>**Total Equity** |
| **Balance at December 31, 2021 (\*)** | **45122** | **(68067)** | **(33970)** | **18188** | **106920** | **(185)** | **68008** | **146** | **68154** |
| Net income/(loss) for the year |  | (46382) |  |  |  |  | (46382) | (1) | **(46383)** |
| Other comprehensive income/(loss) for the year | - | - | - | - | - | (1470) | (1470) | - | **(1470)** |
| **Total comprehensive income/ (loss) for the year** | **45122** | **(114449)** | **(33970)** | **18188** | **106920** | **(1655)** | **20156** | **145** | **20301** |
| Appropriation of result |  | 68067 | (68067) |  |  |  |  |  | **-** |
| Employee share-based compensation (Note 9) |  |  |  | 3369 |  |  | 3369 |  | **3369** |
| Other movements (Note 9) | - | - | - | 877 | - | - | 877 | - | **877** |
| **Balance at December 31, 2022** | **45122** | **(46382)** | **(102037)** | **22434** | **106920** | **(1655)** | **24402** | **145** | **24547** |

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| | |
|:---|:---|
| (\*) | The historical combined carve-out financial statement for the year ended December 31, 2020 was presented based on the former structure of the Codere Online Business prior to the consummation of the Business Combination, where Servicios de Juego Online, S.A.U. ("SEJO") was the holding company until the date of the Business Combination with €60 thousand of issued capital. On November 29, 2021, the Business Combination was completed, and SEJO was contributed to Codere Online Luxembourg, S.A. which became the new Parent Company of the Codere Online Business. Consequently, as of December 31, 2021, the €45,122 thousand of issued capital all corresponds to Codere Online Luxembourg, S.A. and the €60 thousand of issued capital of SEJO has been reclassified to other reserves. The Net Parent Investment balance included the balances that were recorded in the historical Combined Carve-out Financial Statements and the transfer of the balance from Net Parent Investment to other reserves occurred as a result of the Business Combination. Additionally, as explained in Note 9, Codere Online capitalized the majority of its outstanding indebtedness with Codere Group. This was initially recorded under the Net Parent Investment heading and as a result of the Business Combination, has been reclassified to other reserves |

---

The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**CONSOLIDATED STATEMENT OF CASH FLOWS**

**FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 AND**

**COMBINED CARVE-OUT STATEMENT OF CASH FLOWS**

**FOR THE YEAR ENDED DECEMBER 31, 2020**

**(Thousands of Euros)**

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| **Net loss before tax** | **(43415)** | **(67047)** | **(14769)** |
| **Adjustments to profit/loss:** | **(8595)** | **40505** | **1444** |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization (Note 13) | 556 | 721 | 931 |
| &nbsp;&nbsp;&nbsp;Movements in provisions | 3369 | (16) | (117) |
| &nbsp;&nbsp;&nbsp;Change in Expected credit loss | 150 | (67) | 110 |
| &nbsp;&nbsp;&nbsp;Exchange rate impact | (5828) | 50 | 520 |
| &nbsp;&nbsp;&nbsp;Effect of hyperinflation on results | (2265) | 70 |  |
| &nbsp;&nbsp;&nbsp;Other gains and losses (\*) |  | 35835 |  |
| &nbsp;&nbsp;&nbsp;Changes in fair value (Notes 10 and 13) | (4215) | 3937 |  |
| &nbsp;&nbsp;&nbsp;Deferred Taxes (Note 12) | (61) |  |  |
| &nbsp;&nbsp;&nbsp;Interest (Income)/Expenses | (88) | 6 |  |
| &nbsp;&nbsp;&nbsp;Others | (213) | (31) |  |
| **Changes in working capital:** | **10534** | **21145** | **17113** |
| &nbsp;&nbsp;&nbsp;Trade receivables and other current assets (Note 8) | (3935) | 10321 | 3676 |
| &nbsp;&nbsp;&nbsp;Trade payables and other current liabilities (Note 11) | 14469 | 10824 | 13437 |
| **Income tax paid** | **(881)** | **(270)** | **(361)** |
| **Net cash provided by (used in) operating activities** | **(42357)** | **(5667)** | **3427** |
| &nbsp;&nbsp;&nbsp;Payment for purchases of property, plant and equipment (Note 5 and 6) | (164) | (80) | (55) |
| &nbsp;&nbsp;&nbsp;Payments for investments | - | (3) | (17) |
| **Net cash used in investing activities** | **(164)** | **(83)** | **(72)** |
| &nbsp;&nbsp;&nbsp;Drawdown of other borrowings (Note 10) |  | 450 | 245 |
| &nbsp;&nbsp;&nbsp;Capitalized lease payments (IFRS 16) |  | (9) | 9 |
| &nbsp;&nbsp;&nbsp;Proceeds from closing of the Business Combination (Note 7) | - | 89366 | - |
| **Net cash provided by (used in) financing activities** | **-** | **89807** | **254** |
| **Net increase in cash and cash equivalents** | **(42521)** | **84057** | **3609** |
| Cash and cash equivalents at the beginning of the year | 94908 | 10901 | 8018 |
| Effect of changes in exchange rates on cash and cash equivalents | 1421 | (50) | (726) |
| Cash and cash equivalents at the end of the year | 53808 | 94908 | 10901 |

---

\* Other gains and losses correspond to the service cost for the listing of ordinary shares as described in Note 2.

The accompanying notes 1 to 18 are an integral part of the consolidated carve-out financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

1. BACKGROUND

On June 4, 2021, Codere Online Luxembourg, S.A. (the "Company", "Codere Online" or "Parent" and, together with its subsidiaries, the "Group"), was incorporated and was registered in Luxembourg as a public limited company (société anonyme) under the laws of Luxembourg with its registered office at 7, rue Robert Stumper, L-2557 Luxembourg, Grand Duchy of Luxembourg and has been registered with the Luxembourg trade and companies register (Registre de commerce et des sociétés, Luxembourg) under the number B255798.

The Group (formerly denominated Codere Online Business) is comprised of the integrated online gambling operations of Codere S.A. and its subsidiaries ("Codere Group") located in Spain, United States, Mexico, Colombia, Panama, Gibraltar, Israel, Argentina and Malta focused on online gambling and other online services. Codere Group controls the Group through Codere Newco, S.A.U. ("CNEW") holding approximately 66.5% of the ordinary shares of Parent.

Codere Group means until November 19, 2021, Codere S.A. and its subsidiaries and from November 19, 2021, Codere New Topco S.A., a limited liability company (societé anonyme) governed by the laws of the Grand Duchy of Luxembourg, and its subsidiaries, including CNEW. Codere Group is a leading international gaming operator that operates slot machines, bingo seats and sports betting terminals in Latin America (Argentina, Colombia, Mexico, Panama and Uruguay), Spain and Italy, across various gaming venues, including gaming halls, arcades, bars, sports betting shops and horse racetracks. Codere Group has been listed on the Madrid Stock Exchange since October 19, 2007 and was delisted in 2021 as a result of a corporate restructuring.

The perimeter of the Group consists of 10 operating and supporting entities (Spain, United States, Mexico, Colombia, Panama, Gibraltar, Israel, Argentina and Malta) and 2 holding companies (Spain and Luxembourg).

---

| | | | |
|:---|:---|:---|:---|
| **Entity** | **Entity Type** | **Ownership** | **Location** |
| Codere Online Luxembourg S.A. | Holding Company | 100% | Luxembourg |
| &nbsp;&nbsp;&nbsp;Codere Online U.S. Corp. | Supporting Entity | 100% | United States |
| &nbsp;&nbsp;&nbsp;Servicios de Juego Online S.A.U. | Holding Company | 100% | Spain |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Online S.A.U. | Operating Entity | 100% | Spain |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Online Colombia SAS\* | Operating Entity | 100% | Colombia |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Online Panama S.A.\* | Operating Entity | 100% | Panama |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LIFO AenP\* | Operating Entity | 99.99% | Mexico |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Online Operator LTD | Operating Entity | 100% | Malta |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Iberargen, S.A. (online business)\*\* | Operating Entity | 95% | Argentina |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Online Management Services LTD | Supporting Entity | 100% | Malta |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere Israel Marketing Support Services LTD | Supporting Entity | 100% | Israel |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Codere (Gibraltar) Marketing Services LTD | Supporting Entity | 100% | Gibraltar |

---

\* In Panama, Colombia and Mexico new entities were created on October 1, 2021 and incorporated with Servicios de Juego Online S.A.U. (Codere Online Panama S.A., Codere Online Colombia SAS and LIFO AenP, respectively). In the historical combined carve-out financial statements, the assets, liabilities and results related to the online businesses in Panama, Colombia and Mexico were carved-out from the Hipica de Panama S.A., Codere Colombia S.A. and Libros Foráneos S.A. de CV entities, respectively. This was the same case for the first nine months of results included in the consolidated carve-out income statement for the year ended December 31, 2021.

\*\* On November 15, 2021, Iberargen, S.A. a subsidiary within the Codere Group, and SEJO, a subsidiary of Parent, entered into an agreement (as amended from time to time, the "Argentina Restructuring Agreement") pursuant to which: (i) the parties agreed to jointly incorporate a new company in Argentina, Codere Online Argentina, S.A., with Codere Argentina, S.A. and SEJO initially retaining 5% and 95% stakes, respectively. Codere Online Argentina, S.A. was still pending to be incorporated as of December 31, 2021; therefore, the assets, liabilities and results related to the online business in Argentina were carved-out from the Iberagen, S.A. entity and included within the consolidated carve-out financial statements. Additionally, as operations in Argentina began on December 1, 2021, only one month of results are included in the consolidated carve-out income statement for the year ended December 31, 2021.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

Following the incorporation of Parent, the creation of the Group was performed in three steps. The first two steps relate to the reorganization of all the online businesses of Servicios de Juego Online, S.A.U. (the "Restructuring"), which involved (1) the transfer of the relevant entities and businesses that were not direct or indirect subsidiaries or businesses of Servicios de Juego Online, S.A.U. ("SEJO") to SEJO, (2) the transfer of SEJO to Codere Online Luxembourg. The third step relates to the business combination agreement, which was entered into on June 21, 2021, between DD3 Acquisition Corp. II ("DD3"), a publicly listed entity in the United States whose shares were traded on the Nasdaq Capital Market ("Nasdaq"), Codere Online U.S. Corp ("Merger Sub"), a Delaware corporation newly created in 2021 as part of this transaction, CNEW, SEJO and the Company (the "Business Combination Agreement").

The first step of the creation of the Group (the "Restructuring") involved a corporate restructuring where all of the Codere Group's online gaming, gambling, casino, slots, poker, bingo, sports betting, betting exchanges, lottery operations, racing, and pari-mutuel activities became operated or owned by SEJO and its subsidiaries by holding or receiving assets, rights and/or entities from the Codere Group, as set forth in the Business Combination Agreement (except that, in Colombia, Panama and the City of Buenos Aires (Argentina), in lieu of causing the consummation of the restructuring step plan agreed with DD3 in respect of each of such jurisdictions, the Group entered into a Restructuring Agreement with the relevant subsidiaries of Codere Group in the affected jurisdiction). Prior to the corporate restructuring, the following entities were already wholly owned subsidiaries of SEJO: Codere Israel Marketing Support Services LTD, Codere Online Operator LTD, Codere Online Management Services LTD ("OMSE"), and Codere (Gibraltar) Marketing Services LTD.

In Spain and Italy, Codere Online, S.A.U. and Codere Scommese S.R.L., respectively, were transferred to, and became wholly owned subsidiaries of SEJO on June 27, 2021, which became in turn a subsidiary of Parent upon consummation of the Exchange.

In Panama and Colombia, new entities (Codere Online Panama S.A. and Codere Online Colombia SAS, respectively) were incorporated with SEJO as sole or majority shareholder as of October 1, 2021.

On November 15, 2021, Codere Colombia S.A., a subsidiary within Codere Group and the current holder of the online gaming license, and Codere Online Colombia entered into the following agreements, which were amended on November 30, 2021:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a sale and transfer agreement (as amended from time to time, the "Sale and Transfer Agreement") that governed the terms and conditions of the assignment, from Codere Colombia S.A. to Codere Online Colombia S.A.S., of all the assets, contracts and employees necessary for the operation of the Colombian online gaming business by Codere Online Colombia S.A.S. Certain of such assets and contracts are pending assignment as of the date of this annual report. In addition, Codere Colombia S.A. agreed to take any required action for the prompt approval, by the Colombian regulator ("Coljuegos"), of the transfer of the Colombian License to Codere Online Colombia S.A.S.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a joint accounts agreement (contrato de cuentas en participacion) (as amended from time to time, the "Joint Accounts Agreement") pursuant to which, pending the effective transfer of the Colombia License to Codere Online Colombia S.A.S. (or, if applicable, the granting of a new license to Codere Online Colombia S.A.S.), the parties agreed to jointly exploit the Colombia License, with Codere Online Colombia S.A.S. effectively retaining 99.00% of any distributed profits and generally managing the online gaming business; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a license assignment agreement (as amended from time to time, the "License Assignment Agreement" and, together with the Sale and Transfer Agreement and the Joint Accounts Agreement, the "Colombia Restructuring Agreements") pursuant to which Codere Colombia S.A. agreed to assign the Colombian License to Codere Online Colombia S.A.S., subject to the approval of Coljuegos.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The transfer of the Colombian license to Codere Online Colombia S.A.S. was formally requested on December 21, 2021 pursuant to Agreement 08/2020 and Resolutions No. 20161200025334, 20164000029574 of 2016 and 20201000008294 of 2020. As of July 1, 2022, the transfer of the Colombian license to Codere Online Colombia S.A.S. has been approved from Coljuegos and Codere Online Colombia S.A.S. began operating the online business in Colombia under the Colombia License on September 1, 2022.

On November 15, 2021, Hipica de Panama, S.A. ("HIPA"), Alta Cordillera, S.A. ("ALTA"), and Codere Online Panama, entered into an agreement (as amended from time to time the "HIPA Restructuring Agreement"), pursuant to which: (i) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain employment agreements with certain HIPA employees; (ii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right, title and obligations under certain sponsorship, licensing, marketing and other services agreements; (iii) HIPA assigned to Codere Online Panama, and Codere Online Panama accepted the assignment of HIPA's right and title to certain assets in connection with HIPA's online gaming operations; and until the transfer of the ALTA license to Codere Online Panama is effective, Codere Online Panama agreed to provide certain operational and advisory services to HIPA in exchange for monthly payments from HIPA amounting to 99% of HIPA's net income from gaming operations. The HIPA Restructuring Agreement was amended on November 30, 2021.

In addition, on December 1, 2021, upon the commencement of the term of the ALTA license, Codere Online Panama and ALTA entered into an agreement (as amended from time to time the "ALTA Restructuring Agreement" and the HIPA Restructuring Agreement, as partially terminated and superseded by the ALTA Restructuring Agreement, the "Panama Restructuring Agreements") whereby Codere Online Panama agreed to provide certain operational and advisory services to ALTA in exchange for periodic payments on similar terms to the HIPA Restructuring Agreement, terminating and superseding the HIPA Restructuring Agreement with respect to the services being provided by Codere Online Panama to HIPA. The agreement between Codere Online Panama and ALTA shall terminate, among other things, if Codere Online Panama requests the transfer of the ALTA license to Codere Online Panama and such transfer is authorized by the Panama Gambling Control Board.

On November 15, 2021, Iberargen, S.A. a subsidiary within the Codere Group, and SEJO entered into an agreement (as amended from time to time, the "Argentina Restructuring Agreement") pursuant to which:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the parties agreed to jointly incorporate a new company in Argentina, Codere Online Argentina, S.A., with Iberargen, S.A. and SEJO initially retaining 5% and 95% stakes, respectively; Iberargen, S.A. agreed to assign any economic rights related to its 5% stake to SEJO and to seek to transfer such stake to SEJO, provided such transfer is legally allowed and does not affect Codere Online Argentina, S.A.'s operations or the Buenos Aires License;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Iberargen, S.A. undertook to take any required action to facilitate the approval, by Loteria de la Ciudad de Buenos Aires ("LOTBA"), of the transfer of the Buenos Aires License to Codere Online Argentina, S.A.;

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Iberargen, S.A. undertook to, upon LOTBA's approval of such transfer (or, if applicable, the granting of a new license to Codere Online Argentina, S.A. by LOTBA) (the "Condition Precedent"), assign to Codere Online Argentina, S.A. the Buenos Aires License (if applicable) as well as any assets, contracts and employees necessary for the operation of the Argentine online gaming business by Codere Online Argentina, S.A.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Iberargen, S.A. agreed to, if LOTBA authorized it to operate in the City of Buenos Aires before the Condition Precedent is satisfied (as is currently the case), exploit the Buenos Aires License pursuant to the instructions of SEJO (or, once it is incorporated and duly registered, Codere Online Argentina, S.A.), with any resulting expenses and income being assigned to the latter; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) if LOTBA denies the transfer of the Buenos Aires License, and there is no reasonable likelihood that it will grant a new license to Codere Online Argentina, S.A. during the term of the Buenos Aires License, Iberargen, S.A. and Codere Online Argentina, S.A. shall enter into a Temporary Union Contract (contrato de union transitoria) and exploit the Buenos Aires License thereunder, with Codere Online Argentina, S.A. effectively retaining any distributed profits and generally managing the online gaming business.

The second step of the creation of the Group (the "Exchange") involved the transfer of SEJO to Parent in exchange for 29,970,000 of additional newly issued ordinary shares of Parent, nominal value of €1 per ordinary share, which were issued to CNEW. CNEW is a Spanish public limited liability company (Sociedad Anónima Unipersonal), having its registered office at 26, Avenida de Bruselas, 28108 Alcobendas, Madrid, Spain and registered with the trade registry of Madrid under the reference Volume 34399, page 192, section 8, Sheet M-618.784 and is the sole shareholder of the Company.

As explained above, the Group was reorganized through a series of corporate transactions. Firstly, the Restructuring and secondly the Exchange, which was the non-monetary contribution of SEJO to the Company at book value in exchange for 29,970,000 ordinary shares of the Company effective on November 29, 2021 (see Note 9). As result SEJO became a wholly owned subsidiary of Parent. The reorganization of all the online business under SEJO and the subsequent non-monetary contribution was considered a business combination under common control using the "predecessor accounting method".

The third step relates to the merger (the "Merger") of Codere Online U.S. Corp with and into DD3, with DD3 surviving the Merger as a wholly owned subsidiary of Parent. In connection therewith, DD3's corporate name changed to "Codere Online U.S. Corp". The Merger was closed on November 30, 2021, and immediately prior thereto, each share of DD3 Class B Common Stock issued and outstanding immediately prior to the close of the Merger was automatically converted and exchanged for one validly issued, fully paid and non-assessable share of DD3 Class A Common Stock (the "Class B Conversion"). Additionally, each share of DD3 Class A Common Stock issued and outstanding immediately prior to the close of the Merger (15,121,956 shares) was exchanged for one share of the Company (the "Ordinary Shares Merger Issuance") pursuant to a share capital increase of the Company (the "Parent Capital Increase") (see Note 9). Additionally, the conversion of each DD3 warrant (6,435,000 warrants), which no longer represented a right to acquire one share of DD3 Class A Common Stock was substituted by the right to acquire one Company ordinary share on substantially the same terms. The Merger was not considered a business combination under IFRS 3, *Business Combinations*, but rather it has been accounted for under IFRS 2, *Share-based Payment*, as DD3 was not considered to be a business based on IFRS 3. As a result of the Exchange and the Merger completed on November 29 and November 30, 2021, respectively, SEJO and DD3 became direct wholly owned subsidiaries of the Company.

The transactions detailed above pursuant to the Business Combination Agreement, including the Restructuring, the Exchange, the Class B Conversion, the Merger and the Parent Capital Increase, collectively represent the "Business Combination".

The ordinary shares and warrants of Parent have been listed on the Nasdaq since December 1, 2021.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

2. BASIS OF PRESENTATION OF THE CONSOLIDATED CARVE-OUT FINANCIAL STATEMENTS

The accompanying consolidated carve-out financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and pursuant to the interpretations issued by Interpretation Committee of the IASB ("IFRIC"). Note 3 includes a detailed description of the most significant accounting policies used consistently to prepare these consolidated carve-out financial statements.

The consolidated carve-out financial statements were approved by the board of directors on **April 28, 2023.**

The financial statements as of and for the years ended December 31, 2022 and 2021 are consolidated carve-out financial statements. The financial statements as of December 31, 2020 are combined carve-out financial statements. They were considered "combined" financial statements because they reflected the combined results of Parent, SEJO and the entities that were subject to the Restructuring, until the effectiveness of the Exchange on November 29, 2021.

The Restructuring was treated as a reorganization of entities under common control, which is outside of the scope of IFRS 3 (Business Combinations), as such entities were under the common control and managed by the Codere Group. Accordingly, the Codere Group made an accounting policy choice to present business combinations under common control using the "predecessor accounting method" or "pooling of interest method", which involves the following:

● The assets and liabilities of the entities subject to the Restructuring were reflected at their carrying amounts in Codere Group's consolidated carve-out financial statements. No adjustments were made to reflect fair values or recognize any new assets or liabilities at the Exchange Effective Time (means 10:00 a.m. New York time on November 29, 2021) that would otherwise be done under the acquisition method.

● Any difference between the consideration paid/transferred and the aggregate book value of the assets and liabilities of the entities subject to the Restructuring as of the Exchange Effective Time was reflected as an adjustment to equity.

● Include all revenues, expenses, assets and liabilities attributed to the online business as part of the Restructuring.

● Under the pooling of interest method, each of the entities subject to the Restructuring is accounted for as if it had always been part of the Group.

The consolidated carve-out financial statements are considered "carve-out" financial statements because the 2022 and 2021 income statements and statements of cash flows include carved-out results related to the online businesses of certain entities of the Codere Group. In 2021, these entities and/or businesses were transferred to, and became wholly owned subsidiaries of SEJO, which became in turn a subsidiary of Parent upon consummation of the Exchange, except as described herein with respect to (i) Colombia, Panama and the City of Buenos Aires (Argentina), where Restructuring Agreements were entered into, and (ii) Mexico, where Codere Online operates under an "Asociación en Participación" or "AenP", and except for the online business results carved out from Iberagen, S.A. to be presented in the relevant financial statements of Codere Group, until the incorporation of Codere Online Argentina, S.A. in July 18, 2022.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

Additionally, as explained in greater detail in Note 1, the Merger was completed on November 30, 2021 and DD3 became a part of Codere Online. The Merger was not considered a business combination under IFRS 3 (Business Combinations), but rather it was accounted for under IFRS 2 (Share-based Payment), as DD3 was not considered to be a business under IFRS 3. Therefore, the accounting of the Merger in the Annual Financial Statements is as follows:

● To reflect the combination, the equity of DD3 was eliminated and the equity of the Company stayed as the accounting acquirer.

● The difference in the fair value of the ordinary shares transferred to holders of DD3 common stock in excess of the fair value of the net assets contributed by DD3's shareholders represented a service cost for the listing of ordinary shares of the Company, amounting to € 35.8 million and was accounted for as a share-based payment in accordance with IFRS 2.

● The cost of the service, which is a non-cash expense, was € 35.8 million and was accounted for as an expense for the Company at the time of the consummation of the Business Combination (Note 9).

Transaction costs incurred in connection with the consummation of the Business Combination amounted to a total of €16.4 million, of which (i) DD3 incurred €6.8 million, which were accounted for as a reduction in cash and cash equivalents and a corresponding reduction in share premium of Parent in the consolidated carve-out financial statements of Codere Online for the year ended December 31, 2021 and (ii) SEJO incurred €9.6 million, of which €3.0 million were assumed by the Codere Group, and which were reflected as an increase in other operating expenses and as a combination of a reduction in cash and cash equivalents and an increase in share premium of Parent in the consolidated carve-out financial statements of Codere Online from the year ended December 31, 2021. For more information see Note 2 to the Annual Financial Statements.

**Changes in perimeter**

As of 30 December, 2022, the Italian operating entity (Codere Scommese S.R.L.) was sold. The Malta operating entity (Codere Online Operator LTD) and the Malta and Gibraltar supporting entities (Codere Online Management Services LTD and Codere (Gibraltar) Marketing Services LTD, respectively) will be liquidated in 2023 as detailed in the Events After the Reporting Date Note (Note 18).

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

3. ACCOUNTING POLICIES

As stated in Note 2, the Group's consolidated carve-out financial statements for the periods ended December 31, 2022 and 2021, have been prepared in accordance with IFRS as issued by the IASB and pursuant to the interpretations issued by the IFRIC.

The following is a description of the most significant accounting policies used in preparing the accompanying consolidated carve-out financial statements:

&nbsp;&nbsp;&nbsp;&nbsp;a) Basis of consolidation

The consolidated carve-out financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to December 31, 2022.

Control over an investee is achieved by a person or entity when such person or entity (i) has power over the investee, (ii) has exposure, or has rights, to variable returns from its involvement with the investee or (iii) has the ability to use its power to affect the investee's variable returns.

Parent holds 100% ownership of its subsidiaries except for (i) the AenP with LIFO, under which Codere Online is entitled to receive 99.99% of any distributed profits and (ii) Codere Online Argentina, S.A., of which SEJO will initially hold 95% and the economic rights over the remaining 5% once it is incorporated and duly registered. Consolidation of a subsidiary begins when Codere Online obtains control over the subsidiary and ceases when Codere Online loses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in profit or loss from the date Codere Online gains control until the date when Codere Online ceases to control the subsidiary. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used in line with Codere Online's accounting policies. All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between the members of Codere Online are eliminated on consolidation.

Regarding the Restructuring of the entities under common control, was treated as a reorganization of entities under common control, which is outside of the scope of IFRS 3 (Business Combinations). Accordingly, Codere Online made an accounting policy choice to present business combinations under common control using the "predecessor accounting method" or "pooling of interest method", which means the assets and liabilities of the incorporated businesses were reflected at their carrying amounts. No adjustments were made to reflect fair values or recognize any new assets or liabilities at the date of the Closing of the Business Combination that would otherwise be done under the acquisition method. Additionally, any difference between the consideration paid/transferred and the aggregate book value of the assets and liabilities of the acquired entities as of the date of the relevant transaction was reflected as an adjustment to equity.

The consolidated carve-out financial statements were prepared using Codere Group's historical basis in the assets and liabilities and include all revenues, expenses, assets and liabilities attributed to the Group as part of the Restructuring, including certain general and administrative services provided by Codere Group. These general and administrative services were provided by Codere Group until consummation of the Business Combination on November 30, 2021. The Group believes that by including these costs, the consolidated carve-out income statements include a reasonable estimate of actual costs incurred to operate the business. However, such expenses may not be indicative of the actual level of expense that would have been incurred by the Group if it had operated as an independent, publicly traded company during the precedent periods or of the costs expected to be incurred in the future. The Group entered into an agreement with Codere Group effective from December 1, 2021, the day after the closing date of the Business Combination, whereby Codere Group has agreed to provide the Group with the resources to comply with regulators, authorities and other third parties in general. The purpose of this contract is to ensure that the Group is complying with its obligations and correctly reflecting its costs. The fee for these services as per the agreement is 0.75% of the Group's revenue.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;b) Functional and presentation currency

The functional currency of all entities comprising the Group is the currency of the countries in which they operate. The presentation currency of the Group is the Euro and therefore, all balances and transactions denominated in currencies other than the Euro are deemed to be denominated in a foreign currency.

Transactions in foreign currencies are translated at their initial valuation at the spot exchange rate in effect at the transaction date. Monetary assets and liabilities denominated in foreign currencies are translated at the spot exchange rate prevailing at the balance sheet date. Exchange differences, both positive and negative, arising in this process, as well as those arising on settlement of these assets and liabilities, are recognized in the consolidated carve-out income statement for the year in which they arise.

Amounts are presented in these consolidated carve-out financial statements are in thousands of euros, unless otherwise stated.

&nbsp;&nbsp;&nbsp;&nbsp;c) Entities located in hyperinflationary economies

In accordance with IAS 29 "Financial Reporting in Hyperinflationary Economies" a subsidiary operates in a country with hyperinflationary economy when the cumulative inflation rate over three years approaches or exceeds 100%. The standard provides the following criteria for determining whether an economy is experiencing hyperinflation: The population expresses prices in terms of a foreign currency or a relatively stable index, the general population prefers to keep its wealth in non-monetary assets or in a relatively stable foreign currency, sales and purchases on credit take place at prices that compensate for the expected loss of purchasing power during the credit period, even if the period is short or the inflation rate over 12 months is equal to or exceeds 50%.

Since 2018, the economy of Argentina, has been considered hyperinflationary under the above criteria and mainly because Argentina had a significant increase in inflation which by the end of 2018 had reached 48% per year (147% accumulated in three years).

When IAS 29 applies, the subsidiary's financial statements are adjusted for the effects of changes in the general price level, in order to provide users with information that is more meaningful and useful, which means that:

Adjust the historical cost of the non-monetary assets and liabilities and the various equity items from the date of acquisition or incorporation onto the consolidated statement of financial position until the end of the financial year to reflect changes in the purchasing power of the currency as a result of inflation.

- To reflect the gain or loss corresponding to the impact of the year's inflation on the net monetary position on the income statement.

- Adjust the different items on the income statement and cash flow statement by the inflationary index since their generation, with a balancing entry in financial results and a reconciling item in the cash flow statement, respectively.

- Convert all components of the financial statements to the closing exchange rate. In the case of the Argentine companies, to the closing exchange rate as at 31 December 2020 being 103.26 pesos per euro.

At 31 December 2022, no country other than Argentina in which the consolidated entities of Codere Online are located is considered to have a hyperinflationary economy in accordance with the criteria established in this regard by IFRS-IASB.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;d) Intangible assets

Intangible assets are carried at acquisition or production cost, less any accumulated amortization and impairment losses, if any. These assets are tested for impairment when events or circumstances arise that may indicate that their book value may not be recoverable.

Intangible assets can have (i) an indefinite useful life when, based on an analysis of all the relevant factors, it is concluded that there is no foreseeable limit to the period over which the asset is expected to generate net cash inflows for the consolidated entities or (ii) a finite useful life, in all other cases.

Intangible assets with indefinite useful lives are not amortized. When intangible assets have an indefinite life, an impairment analysis is required at least annually, regardless of whether there is a triggering event. Management performs an impairment analysis at the end of each reporting period or whenever there is any indication of impairment. As part of this analysis, management also reviews the remaining useful lives of the assets in order to determine whether they continue to be indefinite and, if this is not the case, to take the appropriate steps to amortize the asset.

As required, management also performs an analysis on intangible assets with definite useful lives in order to determine whether there are any potential indicators of impairment. Intangible assets with definite useful lives are amortized on a straight-line basis according to the following:

● Licenses for computer programs acquired from third parties are capitalized based on the costs incurred to acquire them and to prepare each specific program for use. These costs are amortized over their estimated useful lives.

● The service concession arrangement of the Group was acquired in Italy which grants it rights to economic benefits for online business and was capitalized based on the costs incurred to acquire it. These costs are amortized over their estimated useful lives.

---

| | |
|:---|:---|
|  | **Years of estimated<br> useful life** |
| Service concession arrangement | 2 |
| Software | 4 |

---

&nbsp;&nbsp;&nbsp;&nbsp;e) Property, plant and equipment ("PP&E")

Property, plant and equipment is carried at cost less any accumulated depreciation and impairment in value, if any.

Cost includes, among others, direct labor costs incurred in the installation and the relevant allocable portion of the indirect costs. The Group depreciates its property, plant and equipment from the time they can be placed in service, amortizing the cost of the assets on a straight-line basis over the assets' estimated useful lives, which are as follows:

---

| | |
|:---|:---|
|  | **Years of estimated<br> useful life** |
| Machinery and equipment | 3-10 years |
| Other fixtures, fittings and tools | 3-15 years |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;f) Impairment of non-current assets

Non-current assets are assessed at each reporting date for indicators of impairment if there are certain events or changes indicating the possibility that the carrying amount may not be fully recoverable. Whenever such indicators arise, or in the case of assets which are subject to an annual impairment test, the recoverable amount is estimated. An asset's recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future post-tax cash flows derived from the use of the asset or its cash generating unit, as applicable, are discounted to the asset's present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset, whenever the result obtained is the same that would be obtained by discounting pre-tax cash flows at a pre-tax discount rate.

&nbsp;&nbsp;&nbsp;&nbsp;g) Financial instruments

*Classification of financial assets*

Financial assets and financial liabilities are recognized when an entity within the Group becomes a party to the contractual provisions of a financial instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through net income or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through net income or loss are recognized immediately in the consolidated carve-out income statement.

Financial assets

Financial assets are classified into three main categories: amortized cost, fair value through net income or loss and fair value through OCI, depending on the business model and the characteristics of the contractual cash flows.

Loans, accounts receivable and financial assets that the Group expressly intends and is able to hold to maturity are subsequently measured at amortized cost less any related impairment losses.

Loans and accounts receivable maturing within no more than 12 months from the reporting date are classified as current items and those maturing within more than 12 months are classified as non-current items.

*Impairment of financial assets*

The Group recognizes a loss allowance for expected credit losses on investments in debt instruments which are measured at amortized cost. The amount of expected credit losses is updated on each reporting date to reflect changes in credit risk since the initial recognition of the financial instrument.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The Group recognizes lifetime Expected Credit Losses ("ECL") for receivables, applying the simplified approach established by the IFRS 9 standard. As the Group's historical credit loss experience between Group's entities is nil, the expected credit loss is estimated based on external risk parameters, publicly available, such as the probability of default (PD) of Codere Group and a loss given at default (LGD) of 100%.

*Derecognition of financial assets*

The Group derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.

With respect to the derecognition of a financial asset in its entirety, the difference between the asset's carrying amount and the sum of the consideration received (and which will be received in the future) and the cumulative gain or loss that had been recognized in the consolidated carve-out financial statements of comprehensive income and accumulated in equity is recognized in the Consolidated Income Statement.

Financial liabilities

*Financial liabilities at amortized cost*

Financial liabilities are subsequently measured at amortized cost using the effective interest method.

The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the exact rate that discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

*Financial liabilities at fair value through profit or loss*

Financial liabilities are classified as at fair value through profit or loss ("FVTPL") when the financial liability is (i) contingent consideration of an acquirer in a business combination, (ii) held for trading or (iii) it is designated as at FVTPL.

Financial liabilities at fair value through profit or loss are measured at fair value, with any gains or losses arising on changes in fair value recognized in profit or loss to the extent that they are not part of a designated hedging relationship. The net gain or loss recognized in profit or loss incorporates any interest paid on the financial liability and is included in net financial results in profit or loss.

For financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability's credit risk in other comprehensive income would create or enlarge an accounting mismatch in the consolidated carve-out income statements. The remaining amount of change in the fair value of liability is recognized in the consolidated carve-out income statements. Changes in fair value attributable to a financial liability's credit risk that are recognized in other comprehensive income are not subsequently reclassified to profit or loss; instead, they are transferred to retained earnings upon derecognition of the financial liability.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Derecognition of financial liabilities*

The Group derecognizes financial liabilities when, and only when, the Group's obligations are discharged, cancelled or expire. The difference between the carrying amount of the derecognized financial liability and the consideration paid and payable is recognized in the consolidated carve-out income statements.

*Accounting for warrants*

The warrants meet the definition of a derivative financial instrument as they represent a written put option that gives the holders of the warrants the right to exchange them for the Group's shares at a fixed price. Although the warrants will be exchanged for the Group's shares based on the terms of the warrant agreement, the warrants were classified as a derivative financial liability measured at FVTPL, and not as an equity instrument. Changes in the fair value of the financial liability are presented in the consolidated carve-out income statements under the heading "Finance income / (costs)".

&nbsp;&nbsp;&nbsp;&nbsp;h) Cash and cash equivalents

Cash and cash equivalents comprise cash in hand and at banks, demand deposits and other short-term highly liquid investments with maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. These items are stated, based on their nature, at historical cost, amortized cost or fair value, which does not differ significantly from realizable value.

&nbsp;&nbsp;&nbsp;&nbsp;i) Revenue

Revenue from contracts with customers is recognized when service is provided to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those services. The Group has generally concluded that it is the principal in its revenue arrangements because it typically controls the services before providing them to the customer.

*Online gambling*

The Group generates its revenues from online gambling (online casino and sports betting). The Group recognizes revenue from online gambling at a point in time when each wager has been made and resolved. It is recorded as gambling revenue in the accompanying consolidated carve-out income statement, with liabilities recognized and measured as the aggregate net difference between funds deposited by customers plus winning wagers less losing wagers and less customers withdrawals. We report all the wins as revenue and our provider's share is reported in other operating expenses.

*Balances related to revenue*

A liability is recognized as an obligation to provide the gambling service to a customer for which the Group has received consideration from the customer, at which time a contract liability is recognized under trade payables and other current liabilities. For example, online sports betting involves a player placing a wager on a particular outcome of a sporting event at some fixed odds.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;j) Gambling and Gaming Regulation by Country

*Spain*

The Group operates online gaming in Spain pursuant to the following online licenses granted by the DGOJ, the Spanish gaming regulator, to CDON: (A) three (3) general licenses for a ten (10) year term which were recently extended for ten (10) additional years (until May 31, 2032): (i) Other Games License, (ii) Betting License and (iii) Contests License; and (B) six (6) singular licenses for: (i) slots (granted until July 30, 2025), (ii) roulette (recently extended until June 22, 2025), (iii) black jack (recently extended until June 22, 2025), (iv) sports betting (granted until April 28, 2025), (v) horse betting (granted until April 28, 2024), and (vi) other bets (granted until April 28, 2025) (collectively, the "CDON Licenses").

Online gambling and other gaming activities are regulated along with other forms of gambling by the Spanish Gaming Law. Royal Decree 1614/2011, of November 14, 2011, implementing the Spanish Gaming Law, in relation to gambling licenses, permits and registers in order to facilitate access by the various operators to the activities covered by the Law also includes the procedure to obtain the authorization of reserved gambling activities. General licenses are granted after the corresponding public tender process and have a duration of ten (10) years, renewable for an identical period, unless they are specifically limited. The operation of each type of gambling included in the scope of each general license requires the granting of a specific operating license, regulated by Article 11 of the Law.

Title IV of the Spanish Gaming Law establishes the minimum technical requirements established by the National Gambling Commission that must be met by the technical equipment in terms of sufficient authentication mechanisms to guarantee, inter alia, the following:

● Confidentiality and integrity in communications.

● The identity of the participants, in the case of gambling using telematic and interactive means, as well as the verification, in the terms established by law, that they are not included in the Register provided for in Article 22.1 .b) of this Law.

● The authenticity and calculation of the bets.

● The control of their correct operation.

● Compliance with the subjective prohibitions regulated by Article 6 of this Law.

● Access to the components of the computer system exclusively by authorized personnel or by the National Gambling Commission itself, under the conditions that it may establish.

Royal Decree 1613/2011, of November 14, 2011, implementing the Spanish Gaming Law, provides the regulation of gambling in relation to the technical requirements of gambling activities, regulating the requirements of gambling activities carried out through websites.

● In order to market and carry out gambling activities through websites within the scope of the Spanish Gaming Law, operators must create a specific website under the «.es» domain name to which all connections made from Spain or made with a Spanish user account should be directed.

● The operator must establish the systems, mechanisms or agreements that guarantee that all gambling activities carried out from Spain or using a Spanish user account are handled from the operator's website under the «.es» domain name. In particular, the operator must guarantee that all connections made from Spain or by participants with Spanish user accounts and that were initially directed to websites under a domain other than the ".es," domain which are owned or controlled by the operator, its parent or its subsidiaries, are redirected to the operator's specific website under the «.es» domain.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

● The operator shall notify the National Gambling Commission of the domain name and the relevant information and data on the website that it uses to carry on its activity, as well as any changes therein.

● Where it deems necessary for the protection of the public interest and of minors, the National Gambling Commission may establish that certain types of gambling be marketed and carried out from an exclusive website created for this purpose by the operator.

The Spanish Gaming Law has a decisive impact on sector legislation on advertising, protection of personal data and electronic commerce. These three disciplines include obligations related to the duties of online games, regulated by General Advertising Law 34/1988, of November 11, 1988, and Regulation (EU) 2016/679 of the European Parliament and of The Council of April 27, 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data; Organic Law 3/2018, of December 5, 2018, of Protection of Personal Data and guarantee of Digital Rights; and Law 34/2002, of July 11, 2002, on Services of the Information Society and Electronic Commerce. These measures provide, among others, that betting advertising will only be allowed between 1:00 am and 5:00 a.m. and advertisers using social networks may only broadcast adverts to their followers.

The Spanish Cabinet approved Royal Decree-Law 11/2020, of March 31, 2020, whereby urgent supplementary social and economic measures were adopted to respond to the coronavirus health crisis that led to the declaration of the state of emergency by Royal Decree 463/2020, of March 14, 2020. The new measures introduced by this Royal Decree included the updating of consumer protection measures in the context of the exceptional events caused by the COVID-19 pandemic. It was also essential to establish certain limitations within the framework of gambling regulations.

Therefore, to avoid an increase in online gambling consumption (in particular, casino, bingo and poker games), which can lead to compulsive or even pathological consumption behaviours (specially to protect minors, young adults or people with gambling disorders at a time of greater exposure), restrictions were placed on commercial communications made by gambling operators with a nationwide reach, including entities designated for the marketing of lottery games. However, this particular measure was ultimately repealed by final provision 5.2 of Law 2/2021, of March 29, 2021.

Title VII of the Spanish Gaming Law determines the tax regime applicable to gambling activities in compliance with the provisions of the Additional Provision Twenty of Law 56/2007, of December 28, 2007, on measures to promote the information society, the applicable tax rate being:

● State-run lotteries and games: 22% on the tax base.

● Parimutuel sports betting, straight sports betting and sports betting exchange; parimutuel horse betting, straight horse betting and horse betting exchange; and other parimutuel betting, straight betting and betting exchange: 20% on the tax base.

● Raffles: 20% on the tax base, unless they are declared to be of public utility or for charity and are therefore taxed at 5% on the tax base.

● Contests and other games: 20% on the tax base.

● Random number combinations for advertising or promotional purposes: 10% on the tax base.

General State Budget Law 6/2018, of July 3, for 2018, introduced a regulatory change in terms of tax benefits by reducing by 50% the tax rates on gambling, included in the Spanish Gaming Law. The objective of this reduction is to transfer tax benefits to the Autonomous Cities of Ceuta and Melilla that are collected in other taxes for them. Since then, both Autonomous Cities have seen a reduction in the tax for online gambling operators, leaving gambling tax at 10%. To qualify for this regime, a company is required to be registered in Ceuta or Melilla and 50% of the employees have to be registered in these territories.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Mexico*

Codere Online operates online gaming in Mexico pursuant to license 2768 granted to LIFO in May 1990, which was renewed for a period of 12 years under Official Letter DGJS/1018/2015, expiring on May 10, 2027, which allows for the operation of 18 retail locations in Mexico and online gaming. By virtue of Official Letter No. DGJS/234/2019, dated March 14, 2019 the Ministry of Interior authorizes Codere Online to operate online gaming through the website: www.codere.mx (the "LIFO License").

Mexico lacks a federal provision for online gambling, and the subsector is regulated under the Federal Law on Games and Drawings, of December 31, 1947 (the "Gaming Law"). The Gaming Law establishes that the Federal Executive, through the Ministry of the Interior, is responsible for the regulation, authorization, control and oversight of gambling and betting of any kind, including draws, with the exception of the National Lottery, which is governed by its own law.

On October 23, 2013, the Regulations for the Federal Law of Games and Draws were published in the Mexican Official State Gazette, in which the main technical requirements for the gambling and gaming activities on the internet were determined, among others:

● Article 85 - The establishments shall be able to receive wagers via the internet, by telephone or electronically. For that purpose, they shall establish a system of internal control for the transactions that are made through any of these channels, including a written description of the procedures and regulations to ensure inviolability and prevent the manipulation of wager systems. Said system shall have a record of at least: (i) the number of the account and the identity of the player, and (ii) the date, time, number of transactions, wagered amount and requested selection. The mechanism for receiving wagers shall be previously approved by the Secretariat of Government.

● Article 87 - Permit holders shall fulfil the following procedures for issuing the wager tickets: (i) for each accepted wager, a single and original ticket shall be issued, which shall be given to the player, and it must be printed out with a serial number, bar code and a different number for each ticket machine, apart from the date and time of issue, wagered amount, type of wager and selection; (ii) for the wagers made via the internet, by telephone or electronically, no ticket shall be issued but the information of such wager shall be immediately registered in the central wager system after the wager has been paid. Since these wagers are made via the internet or electronically, the participants shall have access, for consulting or printing, to a voucher of their corresponding number of folio or rights. All wagers by telephone shall be recorded in audio records, with the player's prior consent; (iii) the ticket machines shall operate connected online, in real time, to the central wager system; (iv) when, at the moment of issuing a voucher, there appears an error in the ticket machine, the voucher shall be cancelled in an administrative way; (v) the vouchers shall only be issued in the time and places appointed or authorized in the permit, and the permit holder can issue early vouchers; and (vi) the wager vouchers shall be paid at the moment that they are requested, whether in cash or through other legally accepted means of payment.

Article 20 of the Gaming Law establishes that the Ministry of the Interior may grant permits to operate betting games and prize draws for the following types of business, without making specific reference to online transactions:

● for the opening and operation of betting exchange at racecourses, greyhound tracks and fronton courts, as well as for the installation of remote betting centers and rooms for drawing numbers or symbols, only to business entities that are duly constituted in accordance with the laws of the United Mexican States;

● for the opening and operation of betting exchange at fairs, to Mexican legal persons;

● for the opening and operation of betting exchange at temporarily established horse races or cock fights, to business entities duly constituted in accordance with the laws of the United Mexican States and natural persons; and

● for the organization of prize draws, to natural and legal persons constituted in accordance with the laws of the United Mexican States.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The latest reform of the Special Tax on Production and Services Law (the "Special Tax Law") published by the Mexican Official State Gazette (DOF) 12/09/19 establishes that the operation of betting games and draws, regardless of the name given to them, that require permission in accordance with the provisions of the Gaming Law and its implementing Regulations, are taxed at a rate of 30%.

Article 18 of the Special Tax Law establishes that the taxable base will include the total amount of bets made by the players, minus prizes and refunds obtained by the players (refunds prior to the betting event). A 30% tax rate will be applicable on the taxable base.

According to the Special Tax Law, the resulting amount may be reduced by:

● the total taxes paid according to the Gaming Law; and

● up to 20% of the amount paid to the Mexican gaming authority in order to undertake a betting activity.

Finally, local gaming taxes may apply depending on each municipality and ranging from 6% to 15% tax rate on the gaming revenue of the company, and a 6% withholding on the prizes obtained by the player. In addition, in recent years, many states have established a tax on expenditures to be withheld from all players and ranges from 6% to 16.5% on their recharge (cash in).

*Colombia*

Codere Online operates online gaming in Colombia pursuant to license C1470, which allows for the operation of online gaming, granted by the Colombian gaming regulator, Coljuegos, to Codere Colombia, S.A. for a term of five (5) years and which expires on November 15, 2022 (the "Colombia License"). As of July 1, 2022, the transfer of the Colombian license to Codere Online Colombia S.A.S. has been approved from Coljuegos and Codere Online Colombia S.A.S. began operating the online business in Colombia under the Colombia License number C1901 on September 1, 2022.

Decree Law 4142 of 2011, amended by Decree number 1451 of 2015, founded the Empresa Industrial y Comercial del Estado Administradora del Monopolio Rentístico de los Juegos de Suerte y Azar ("Coljuegos"), whose role is "[…] the exploitation, administration, operation and issuance of regulations of the games that are part of the state monopoly of gaming that by law are not attributed to another entity [...]."

Pursuant to Article 38 of Law 643 of 2001, amended by Article 93 of Law 1753 of 2015, games operated over the internet are understood to be those in which betting and the payment of prizes are carried out by means that do not require the presence of the player, after they have registered on the authorized website or portal, and the mechanics of which are based on the use of a random number generator or the occurrence of real events, the results of which are not controlled by the operator of the game. Additionally, and focusing on the online gambling subsector, pursuant to the law "[…] Novelty games are considered, among others, to be pre-printed lotto, the instant lottery, the online lotto in any of its modalities, sports bets or bets at events and all games operated over the internet, or by any other form of information technology that does not require the presence of the bettor."

Through resolution number 04 of 2016 and subsequently through resolution number 08 of 2020, Coljuegos approved gaming regulations in relation to novelty games operated over the internet. Those legal persons that are awarded a concession may operate online gaming once they execute the corresponding concession contract and following verification of compliance with the requirements under the gambling regulations and any other parameters as determined by Coljuegos. The operation of other novelty games require authorization from Coljuegos and compliance with the selection processes established in the public procurement general statute.

Article 38 of Law 643 of 2001 provides that the operator must pay an operating fee of 17% of its gross gaming revenue to Coljuegos. When the operator operates novelty games that give the player a return in accordance with the gaming regulations of 83% or more, the minimum rate for the operating rights will be 15% of the gross gaming revenue minus the prizes paid. Notwithstanding, those who operate online games will additionally pay 811 legal monthly minimum wages, which will be settled during the first 20 business days of each operating year.

Article 93 of Law 1753 of 2015, establishes that internet gambling operators, in addition to paying an operating fee of 17% of gross gaming revenue, must pay COP 559,147,194 (legal tender) in tax at the beginning of each operating year. In addition to this tax, Coljuegos will demand payment by the operator of the so-called "Administration Expenses," which will be 1% of the operating fee.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Italy*

Codere Online operates online gaming in Italy pursuant to Remote Gaming License no. 15411 granted to Codere Scommese S.r.l. on October 7, 2019, which expires on December 31, 2022 (the "Italy License") and which grants Codere Scommese S.r.l. the right to operate the following online gaming activities:

● fixed odds and 'totalizator' bets on sports events, including simulated ones, including those relating to horse racing, as well as on other events;

● sports and horse racing betting;

● national horse racing games;

● skill games, including card games in tournament and different modes, as well as games of chance at fixed odds;

● fixed odds bets with direct interaction between players; and

● bingo

According to Italian criminal law, gambling that is not subject to State control is illegal under Article 718 of the Italian Criminal Code, whether organized in a public establishment or a private club. Italian law distinguishes between games of luck and games where the outcome depends on the player's skill. Sports betting, lotteries, and some other activities fall into the category of legal and regulated gambling activities.

Only the State has the right to authorize gaming and gambling activities pursuant to article 1 of the Italian Legislative Decree of April 14, 1948 no. 496. The Autonomous Administration of State Monopolies (Agenzia delle Dogane e dei Monopoli) (the "ADM"), the entity responsible for regulating gambling activities on a state level, has the power to grant gaming licenses to legal persons through tender processes provided they comply with all requirements and parameters included in the tender offer, as well as with any other applicable laws or regulations. The call for tenders for the online business in Italy was announced in March 2018.

The main reason why the Italian government has adhered to strict rules has been the desire to avoid the possible negative effects associated with the industry. The following amendments liberalized the market in 2006:

● Legalization of interactive peer-to-peer remote betting on fixed odds (betting exchange);

● Legalization of real-money remote skill games;

● Possibility for operators based in any EU and EFTA country and even in an offshore jurisdiction, to apply for an Italian gambling license provided they comply with certain suitability requirements and re-locate their gaming servers to Italy; and

● New license tender aimed at redesigning and reorganizing the offline network of betting shops and betting corners as well as legalizing online gaming yet strictly under the scope of a remote gaming license to be granted by ADM subject to payment of a one-off license fee of €300,000.

Law No. 77 dated as of June 24, 2009 deals with measures concerning the gaming sector following the Abruzzo Decree. The most relevant provision in the tax scheme is the introduction of an unprecedented profit-based tax regime with a flat 20% rate applying to all new games listed above other than the video lotteries. This provision is of paramount importance as it paves the way to the launch of games that otherwise could have never been offered in Italy given its penalizing turnover-based tax regime which however will continue to apply to sports and horse races betting, bingo, lotteries and skill games (including online poker tournaments that will thus continue to be taxed at 3% of the total tournament buy-ins sold by the operator).

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Panama*

Codere Online operates online gaming in Panama pursuant to Resolution No. 921 of September 21, 2017 which authorizes HIPA to operate online sports betting by virtue of Contract No. 1 of April 16, 2018 (under which it was awarded 5 licenses for a five (5) year term, renewable for another five (5) years) and Contract No. 193 of October 4, 2005 (under which it was awarded 51 licenses for a twenty (20) year term) (the "HIPA License"). In addition, ALTA was awarded a standalone online gaming license, under which ALTA is authorized to conduct online gaming operations in Panama for a twenty (20) year term starting on December 1, 2021, subject to compliance with certain requirements pursuant to the Regulation (the "ALTA License"). As described under Item 7.B. "Related Party Transactions—Material Agreements—Panama Restructuring Agreements", Codere Online may request the transfer of the ALTA License from ALTA to Codere Online, but such transfer is subject to the authorization from the Panama Gambling Control Board. While the ALTA License is held by ALTA, Codere Online will operate the ALTA License under the agreement that Codere Online Panama and ALTA entered into on December 1, 2021.

Law Decree No. 2 of February 10, 1998 (the "Law Decree"), is the legal framework which regulates gaming and gambling activities in Panama. The Gaming Control Board, in representation of the Panama State, assumes the operation of gambling activities and betting activities, for the exclusive benefit of the Panama State. This operation may be exercised directly or through third parties.

Hence, gambling and betting activities that take place in Panama must be authorized, regulated and supervised according to the dispositions of the Law Decree, including gaming and gambling activities and betting activities which take place abroad, by electronic means or other means of remote communication.

In 2002, The Gambling Control Board Plenary, in exercise of its legal powers, issued the regulations governing the licenses of electronic gambling activities which was recently modified by Resolution No. 11 of March 6, 2020 (the "Resolution"). The Resolution regulates the operation of gambling activities through internet and establishes the procedures and requirements to be fulfilled by all individuals and corporations interested in obtaining a license to operate online gaming platforms. This Resolution expressly excludes from the definition of gambling activities racehorses, lottery, and amateur matches in which Panamanian nationals participate.

Under national law, and individual or corporation may be awarded a maximum of five (5) licenses. Licenses may be granted for a maximum term of twenty (20) years. This license award is always at the discretion of the Gaming Control Board. If the Gaming Control Board authorizes a concession agreement, a one-time fee of fifty thousand balboas (50,000 PAB) must be paid to the Panama State for each gaming license that is awarded, upon the ratification by the National General Controller. Furthermore, during the period established in the concession agreement, the licensee must: (i) pay to Gambling Control Board ten percent (10%) of its gross gaming revenue (to be paid monthly), (ii) grant a compliance guarantee and a prize payment guarantee, and (iii) comply with the terms and conditions of the concession agreement, the Resolution, the Law Decree and any applicable Panamanian legislation, such as:

Law No. 27 of March 24, 2015 and the Executive Decree No. 264 of June 17, 2015, that establish a 5.5% gambling tax, which the licensee, as collector agent, should charge to each payment ticket or coupon, tokens and other documents that have a payment obligation due to gambling activities, betting activities and any other gaming and gambling activity authorized by the Panama State;

Law No. 23 of April 27, 2015 on prevention of money laundering and the funding of terrorism and the financing of the proliferation of weapons of mass destruction. Therefore, a licensee operating gambling activities, betting activities and any other gaming activity authorized by the Panama State is also regulated and supervised by the Superintendence of Supervision and Regulation of Non-Financial Subjects; and

- Law No. 81 of March 26, on data privacy.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

Before standalone online licenses, such as the ALTA License, were authorized pursuant to the Resolution, some operators, such as HIPA, were authorized to operate online sports betting pursuant to a license that allowed the licensee to operate land-based betting agencies under Resolution No. 43 of October 24, 2016 which modified the Resolution No. 77 of September 4, 1999, provided that (i) the client previously registered through land-based betting agency, and (ii) the operator obtained prior authorization from the Gaming Control Board.

A sports betting operator must pay the Gaming Control Board the following monthly fees: (i) 2% on prizes paid, (ii) 0.25% on amounts wagered of international sport betting, and (iii) 0.5% on amounts wagered of international greyhound racings.

*Argentina*

In Argentina, gaming is mainly regulated at the provincial level. Each province has the exclusive power to exploit, organize, manage, operate, control, monitor, and regulate all forms of gaming, and to establish the conditions to operate in the gaming sector. The power to grant licenses and authorizations for gaming activities is vested on each province. However, gaming activities may be subject to both provincial and federal taxes.

Article 50 of the Constitution of the City of Buenos Aires, provides that the City of Buenos Aires has the exclusive right to exploit and commercialize gambling. The City of Buenos Aires cannot delegate its power to exploit online gaming to third parties. It can only grant permits to authorize private companies to distribute and commercialize online gaming. Law N°538 authorizes the Executive Power of the City of Buenos Aires to create and regulate games approved by the City of Buenos Aires Legislature.

In May 2019, the City of Buenos Aires issued resolution RESDI-2018-321-LOTBA (the "Regulation") approving setting forth the regulatory framework applying to online gaming activities within the City of Buenos Aires. The Regulation was later approved by the City of Buenos Aires Legislature. The regulator of the gambling activity in the City of Buenos Aires is the state-owned company Lotería de la Ciudad de Buenos Aires S.E. ("LOTBA"). The Regulation provides that LOTBA may grant permits to third parties for the commercialization and distribution of online gambling. Such permits may be granted for a term of up to five (5) years, renewable for another five (5) years. The holder of such permit shall pay 10% of the gross gaming revenue ("GGR") to the City of Buenos Aires through LOTBA.

The process to award permits was launched in February 2020 following the approval of resolution RESDI 15/LOTBA/20 (subsequently amended by RESDI/71/LOTBA/20) that provides the legal requirements that must be fulfilled by the applicants in order to obtain a permit.

In 2020, Iberargen S.A. submitted an application for a permit and complied with all the requirements requested by LOTBA. On March 12, 2021, LOTBA granted the permit to Iberargen S.A. under code DI-2021-238-GCABA-LOTBA (the "Buenos Aires License") for a period of five (5) years and, in December 2021, authorized Iberargen, S.A. to operate in the City of Buenos Aires thereunder.

In addition, gambling in the City of Buenos Aires is subject to a tax on the gross revenue (defined as GGR minus the 10% tax payable to LOTBA) of 6.0%. Law 27.591, as amended on 2021, created a new federal tax applying to online gambling. The tax rate is 2.5% and up to 15% of the net customer deposits, depending on whether the operator is a local company having investments in the gaming sector in Argentina or not. Enforcement of Law 27.591 is subject the issuance of implementing regulations by the federal tax authorities.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Malta*

Codere Online holds business-to-consumer ("B2C") and business-to-business ("B2B") Maltese gaming licenses, but it does not currently offer online casino and sports betting to customers located in Malta. Codere Online Operator Limited's ("ONOL") B2C license was issued on April 15, 2019 and is valid for a period of ten (10) years (the "B2C License"). ONOL requested a voluntary suspension of the B2C License and is in the process of requesting a definitive surrender of such license.

Codere Online Management Services Limited ("OMSE") was issued a B2B gaming license on April 15, 2019 for a ten (10) year term (the "B2B License"). Codere Online is authorized to provide Type 1 (Casino) and Type 2 (Fixed Odds Betting) B2B gaming services via OMSE's B2B License.

Regulation 3 of the Gaming Authorisations Regulations (Subsidiary Legislation 583.05 of the Laws of Malta), provides that "no person shall provide or carry out a gaming service or provide a critical gaming supply from Malta or to any person in Malta, or through a Maltese legal entity, except when in possession of a valid licence […]", without prejudice to any exemptions provided in applicable law.

Regulation 3 (2) of the Gaming Authorisations Regulations provides that "no person shall offer a licensable game, whether as part of a gaming service, critical gaming supply or otherwise, unless such game is approved or otherwise recognised" by the Maltese Gaming Authority's ("MGA"). A licensable game is "a game which is not an exempt game". Generally, without prejudice to ad hoc exemptions as may be applicable, games which are licensable are games of chance and controlled skill games.

The authority responsible for, inter alia, the regulation, supervision and enforcement of the Gaming Act and all subsidiary legislation falling under the remit of the same is the MGA. The MGA is considered to be the primary point of contact for regulatory reporting by licensees, with the latter obliged, in terms of numerous Regulations and Directives (such as Directive 3 of 2018), to notify, seek prior approval and inform the MGA of events and changes across multiple aspects of each licensed business, including but not limited to, a change in delivery channel of a gaming service and changes to approved technical set up.

Any person in possession of a license issued by the MGA shall pay the MGA the appropriate fees in relation to the type of license awarded. As operator of the B2C License, ONOL is due to pay (a) a license fee composed of a fixed annual license fee and a variable component known as the compliance contribution and (b) gaming tax. The variable component within the compliance contribution and the calculation method has been established by the MGA in Directive 4 of 2018 – Directive on the Calculation of Compliance Contribution. The compliance contribution is a variable percentage charged on tranches of gaming revenue generated in a particular game type.

As operator of the B2B License, OMSE is due to pay a variable annual license fee. The variable annual fee for the B2B License ranges from €25,000 to €35,000, depending on the company's annual revenue.

Gaming tax is set at 5% on gaming revenue generated from Malta based players. Accordingly, taxability is determined by whether the player is established, has his permanent address and/or usually resides in Malta. In light of ONOL's voluntary suspension of the B2C License, ONOL's obligation to pay the compliance contribution and gaming tax, as applicable, was suspended from the date the suspension was approved by the MGA.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;k) Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax, if any.

*Current tax*

The tax currently payable is based on taxable income for the year. Taxable income differs from income before tax as reported in the consolidated income statement because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group's current tax is calculated using rates applicable for the tax period that have been enacted or substantively enacted by the end of the reporting period.

*Tax impacts of the Business Combination*

As a result of the Business Combination explained in Note 1, the following steps were followed:

- Carve-out process in different countries:

The financial information related to Codere Group's online business was carved-out from the traditional retail business. See considerations for each country below.

**Spain:** The Spanish company Codere España S.A. performed a financial spin-off of its shares in Codere Online (Melilla) in favour of SEJO. Based on the valid economic grounds of the transaction, the Group has applied the tax neutrality regime that provides roll over relief for Spanish CIT purposes. The Group complied with the formal obligations to apply this regime (formally opt for the regime and communication to the Tax Authorities). As per IAS 12, no deferred taxes have been recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the shares transferred were transferred at the value it had in the transferor for accounting and tax purposes.

**Mexico:** SEJO entered into a joint venture agreement (AenP or "Asociacion en Participacion" in Spanish) and set up "Codere Online Mexico AenP", which is owned by two partners, Libros Foráneos, which holds 0.01%, and SEJO acting as the online gambling holding entity, which holds 99.99%. From a Mexican tax perspective, entering into this joint venture agreement did not create any adverse (direct or indirect) Mexican tax implications. As per IAS 12, no deferred taxes have been recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the transfer of the business was done at fair market value for accounting and tax purposes.

**Italy:** Codere Scommese S.r.l. ("Codere Scommese") only performs activities related to the online business and not traditional retail activities; therefore, the shares of the entity were directly transferred from Codere Scommese to SEJO. The transfer of the shares has given rise to a capital gain that will be taxed in the corporate income tax of the Group. However, the Group will apply the 95% "participation exemption" as the requirements for the application of the exemption are met. As per IAS 12, no deferred tax assets or liabilities have been recorded as a consequence of this transaction as the transfer of Codere Scommese's shares were valued for accounting and tax purposes at market value.

**Argentina:** The entity that held the online license in Argentina was Iberargen, S.A. ("Iberargen"). As Codere Online Argentina has not been registered yet, the entity that is operating the online business is Iberargen and the results from online business of Argentina were carve-out from Iberargen since the online operations in Argentina started on December 1, 2021. There are no tax implications on the incorporation of Codere Online Argentina.

**Panama:** The entity that held the online license in Panama was Hípica de Panama, S.A. ("HIPA") until December 1, 2021 and ACOR as from December 1, 2021. SEJO did incorporate a new entity in Panama, Codere Online Panama, that has applied for a new online gambling license, as the ones owned by HIPA and ACOR cannot be transferred to Codere Online Panama for regulatory reasons. There were no tax implications on the incorporation of Codere Online Panama. In the meantime, Codere Online Panama will render online management services to HIPA and ACOR. Remuneration for management services rendered by Codere Online Panama to HIPA and ACOR has been agreed at arm's length. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**Colombia:** The entity that holds the online license in Colombia is Codere Colombia S.A. ("CCOL"). The transfer of the online license from CCOL to Codere Online Colombia has already been requested to the regulatory agent. There were no tax implications on the incorporation of Codere Online Colombia. In the meantime, Codere Online Colombia will render online management services to CCOL. Remuneration for management services rendered by Codere Online Colombia to CCOL has been agreed at arm's length. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

- Incorporation of Parent in Luxembourg and Merger Sub in Delaware:

CNEW incorporated Parent in Luxembourg on June 4, 2021. In addition, Parent incorporated a subsidiary corporation in Delaware, Merger Sub. No adverse tax implications arose in Luxembourg or the United States for the incorporation of these entities. As per IAS 12, no deferred tax assets or liabilities were recorded on this transaction.

- Share for share Exchange:

Following the Restructuring CNEW contributed SEJO to Parent pursuant to the Exchange. In Spain, based on the valid economic grounds of the transaction, the Group has applied the tax neutrality regime that provides roll over relief for Spanish CIT purposes. The Group complied with the formal obligations to apply this regime (formally opt for the regime and communication to the tax authorities). In Luxembourg, no adverse tax impact arose, as the transfer of the shares in SEJO in exchange for new shares in the Company was performed at fair market value and the Company issued shares for the same value. As per IAS 12, no deferred taxes were recorded as: (i) no tax losses or other tax credits were transferred on this transaction and (ii) the shares transferred were transferred at the value it had in the transferor for accounting and tax purposes.

- Reverse merger for the SPAC (DD3)

The Merger was effective on November 30, 2021 (i.e., one business day after effectiveness of the Exchange. In Luxembourg, no adverse tax impact arose. In the United States, no adverse tax impact arose as the adverse consequences of the inversion rules were not applicable (see "U.S. Anti-Inversion Rules" section below).

- Parent Capital Increase

The Company increased its share capital in connection with the Merger. This share capital increase was subscribed by DD3's shareholders by means of the contribution of their Class A common stock (following the Class B Conversion) of DD3. That is, DD3's shareholders exchanged their DD3 common stock for ordinary shares of Parent. Following the consummation of the Merger, the Company became the sole shareholder of DD3 and the former shareholders of DD3 became shareholders of Parent, together with Codere Newco. In Luxembourg, no adverse tax impact arose, as the Company issued new instruments with a value which corresponds to the fair market value of the DD3's Class A common stock.

*United States ("U.S.") Anti-Inversion Rules*

Under the U.S. "anti-inversion" rules, adverse consequences may apply to certain acquisitions of domestic corporations and domestic partnerships (or their assets) by foreign corporations. These consequences generally depend, among other things, on the degree of ownership continuity by former shareholders of the domestic acquired corporation or partnership.

A U.S. inversion transaction generally is a transaction in which a U.S. parented group changes the jurisdiction of its parent corporation to a foreign jurisdiction. Generally, an inversion transaction is subject to Section 7874 and has adverse tax consequences when: (i) a foreign corporation acquires a U.S. corporation (or substantially all of its assets), (ii) the shareholders of the U.S. corporation receive 60% or more of the stock of the foreign corporation and (iii) following the acquisition the foreign corporation does not have 25% or more of its worldwide operations in its country of organization.

The Group and its U.S. tax advisors have reviewed the requirements of the application of the U.S. inversion rules to the reverse merger of Merger Sub into DD3 and concluded that the U.S. inversion rules stated in Section 7874 should not apply because the shareholders of DD3 received for purposes of Section 7874 less than 60% of the ordinary shares of Parent. However, the rules for determining ownership under Section 7874 are complex, unclear in some respects, and the subject of ongoing and recent legislative and regulatory review.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;l) Non-current and current assets and liabilities

Presentation in the consolidated statement of financial position differentiates between current and non-current assets and liabilities. Assets and liabilities are regarded as current if they mature within one year or within the normal business cycle of the Group or are held-for-sale. Non-current assets and liabilities include all other types of assets and liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;m) Critical judgments and use of estimates

Below is a discussion regarding the key assumptions made by the Group in preparing its estimates concerning future performance and other relevant sources of uncertainty at the reporting date that could have a significant impact on the consolidated carve-out financial statements within the next financial year.

*Measurement of assets and liabilities*

The measurement of assets and liabilities was based on the carrying amounts that would be included in the Codere Group's consolidated financial statements, based on Codere, Group's date of transition to IFRS, if no adjustments were made for consolidation procedures and for the effects of the Business Combination in which the parent acquired the subsidiary. Thus, any goodwill recorded at Codere Group related to the reorganization of any of the companies/business was not pushed down to any of the entities in the Group perimeter. For the purposes of preparing the consolidated carve-out financial statements, 100% of the individual balance sheets and income statements of seven entities, including SEJO, were transferred to the online perimeter. For the remaining three entities that are included in the online perimeter, the individual income statement and balance sheet accounts were reviewed by management to determine which accounts related solely to the online business and therefore transferred to the online perimeter. These balances were easily identifiable, as the accounting system separately tracked transactions related to the retail and online businesses; therefore, management was able to identify those accounts which were solely related to the online business.

*Cost of doing business*

During 2021 and 2020, there were certain costs that were incurred by the Codere Group, which were considered to be common expenses. Therefore, an allocation of these common expenses was performed in order to reflect the portion of these expenses related to the Group in the consolidated carve-out financial statements in 2020 and until November 30, 2021. These common expenses included general corporate expenses, such as, management, audit fees, legal expenses, systems and communication, and office rental expenses. The general corporate expenses that were allocated to the online business were allocated based on the actual expenses related to time spent supporting the entities included in the online perimeter. Office rental expenses were allocated on a per square meter basis used by the entities included in the consolidated carve-out financial statements of the Group. The Group entered into an agreement with Codere Group effective from December 1, 2021, the day after the closing date of the Business Combination, whereby Codere Group has agreed to provide the Group with the resources to comply with regulators, authorities and other third parties in general. The purpose of this contract is to ensure that the Group is complying with its obligations and correctly reflecting its costs. The fee for these services as per the agreement is 0.75% of the Group's income.

&nbsp;&nbsp;&nbsp;&nbsp;n) Going concern

In the context of the Consolidated Carve-out Financial Statements, the Group had positive equity of €68.1 million as of 31 December, 2021 and 24.5 million as of 31 December, 2022. Additionally, as of December 31, 2022 the Group had positive working capital (current assets less current liabilities) amounting to €25.5 million and positive working capital amounting to €73.0 million as of December 31, 2021, due to the cash inflows as result of the 2021 Merger described in Note 1.

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**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The Group has a limited operating history and prior to the Business Combination, the Group funded its operations primarily through short-term debts with Codere Group. Since its inception, the Group has incurred recurring losses and negative cash flows from operations including net losses of €46.3 million, €68.0 million and €16.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. At the end of the reporting period the Group expects to continue to generate operating losses through 2023. Securing the financing of development activities and operations represents an ongoing challenge for the Group. As of December 31, 2022, the Group had a shareholders' equity position of €24.5 million and €53.8 million of cash and cash equivalents, €4.8 million of which was restricted (€94.9 million in cash, of which €3.5 million was restricted in 2021).

On March 29, 2023, Codere Group announced a further financial restructuring process (the "2023 Proposed Restructuring"). As part of the 2023 Proposed Restructuring, Codere Group has entered into a lock-up agreement with a group of its bondholders which provides for a standstill period that would enable it to implement a further restructuring of its liabilities. The form of the restructuring will be based on the bondholder support obtained but which is expected to include the provision of €100 million in new money and the amendment of certain maturities, coupon amounts and composition, seniority and other terms of the Codere Group's existing liabilities.

The Group currently depends on Codere Group for the provision of certain services. Codere Group's ability to provide these services to Codere Online or its performance of the related-party agreements (including the Sponsorship and Services Agreement, the Relationship and License Agreement, the Platform and Technology Services Agreement, the AenP Agreement or the Restructuring Agreements, on which Codere Online currently depends to conduct its business) may be affected by Codere Group's ongoing financial restructuring, particularly if it failed to meet its liquidity needs, its operations were interrupted or intervened or otherwise. Moreover, any of the foregoing events may adversely impact the reputation of the Codere Group and, as a result, adversely affect Codere Online's reputation and the "Codere" brand, or otherwise adversely affect Codere Online's business, results of operations and financial condition.

Beyond the services provided, an event of insolvency by Codere Group may constitute a breach of certain of Codere Online's licenses and result in their revocation. For example, in Mexico, the LIFO License, under which Codere Online operates, could be automatically revoked if LIFO were to file for insolvency protection. There can be no assurance that Codere Online would maintain or be able to renew its licenses in the event of insolvency or other financial difficulty, including upon the filing or declaration of insolvency of Codere Newco or Codere New Topco S.A. (the parent company of the Codere Group), as such filing or declaration may be perceived to adversely affect the solvency of Codere Online as well.

The Group's dependence on Codere Group for the use of the Codere brand, certain gaming licenses, and certain services (as described above), results in a material uncertainty about the Group's ability to continue as a going concern. However, management has prepared the financial statements as of December 31, 2022 under the going concern principle, considering not only that Codere Group's ongoing financial restructuring processes will be successfully completed, and therefore, the uncertainties about the Group due to its dependence on the Codere Group will not materialize, but also the Group's current liquidity position, actual operating performance, and its reasonable expectations regarding operating performance over the coming three years which lead them to believe that the Group has adequate resources to continue in operational existence for the next twelve months. The evaluation about Codere Group's ongoing financial restructuring processes being successfully completed is consistent with the evaluation made by management of the Codere Group regarding this situation in their financial statements as of December 31, 2022.

As part of its going concern assessment, management developed a business plan with operational and financial projections through 2025. Based on this business plan, management believes the Group currently has sufficient cash available to finance its operations through 2025. This business plan contemplates that the Group will be investing a substantial part of its available cash over this three-year period (to fund negative operating cash flow) in order to achieve higher growth and increased market share in its existing core markets throughout Latin America and Europe (primarily Spain), and that the overall business will begin generating positive cash flow in 2024. Also, if the business underperforms in comparison to the business plan targets, the Group may either seek external financing and/or otherwise reduce or delay marketing expenses to mitigate the impact on its cash position.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

&nbsp;&nbsp;&nbsp;&nbsp;o) New IFRS and interpretations of the IFRS Interpretations Committee ("IFRIC")

The Group has applied all of the applicable IFRS-IASB standards and amendments that were effective for periods ending December 31, 2022 and prior to such date. The Group has used the same accounting policies in its opening IFRS consolidated statement of financial position and through all of the periods presented in these consolidated carve-out financial statements.

As of December 31, 2022, the following standards, amendments and interpretations have been published by the IASB, but their application is not yet mandatory for the Group, and the Group has not elected to early adopt the policies once allowed to do so.

---

| | | |
|:---|:---|:---|
| **Standards and Amendments** | **Standards and Amendments** | **Mandatory application:<br> annual periods beginning on or after** |
| IFRS 17 - Insurance Contracts | Replaces IFRS 4 and clarifies the principles of registration, measurement, presentation and disclosure of insurance contracts in order to ensure that the entity provides relevant and reliable information that allows the users of the information to determine the effects of the contracts on their financial statements. | 1 January 2023 |
| Amendments to IAS 1- Presentation of Financial Statements, disclosure of accounting policies and IFRS Practice Statement 2, Making Materiality Judgements | Clarifications regarding the presentation of liabilities as current and non-current.<br>The amendments will help improve disclosures on accounting policies to provide more useful information to investors and other primary users of financial statements.<br>The IASB also amended IFRS Practice Statement 2 to include guidance and examples on applying materiality to accounting policy disclosures. | 1 January 2023 |
| Amendments to IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates | The amendments will make it easier to distinguish between changes in accounting estimates and changes in accounting policies. | 1 January 2023 |
| Amendment to IAS 12 - Deferred tax on leases and decommissioning obligations | The amendments will clarify that the exceptions to initial recognition are not applicable when there are taxable and deductible timing differences for the same amount. | 1 January 2023 |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

---

| | | |
|:---|:---|:---|
| **Standards and Amendments** | **Standards and Amendments** | **Mandatory application:<br> annual periods beginning on or after** |
| Amendment to IAS 1 - Classification of Liabilities as Current or Non-current. Non-current Liabilities with Covenants | The amendment clarifies a criterion in IAS 1 for classifying a liability as non-current. The requirement for an entity to have the right to defer settlement of the liability for at least 12 months after the reporting period.<br>The amendments improve the information an entity provides when its right to defer settlement of a liability for at least twelve months is subject to compliance with covenants. The amendments also respond to stakeholders' concerns about the classification of such a liability as current or non-current. | 1 January 2024 |
| Amendment to IFRS 16 - Lease Liability in a Sale and Leaseback | Lease Liability in a Sale and Leaseback amends IFRS 16 by adding subsequent measurement requirements for sale and leaseback transactions: | 1 January 2024 |

---

The IASB is prioritizing collaborating with the new International Sustainability Standards Board (ISSB®) and is committed to ensuring connectivity in financial reporting to meets users' needs.

The IASB is limiting its plans to a new maintenance pipeline project on climate-related risks, that will address users' concerns about inconsistent application of IFRS Accounting Standards to climate related risk and insufficient disclosures in the financial statements about these risks. The IASB is also limiting its plan to two new research pipeline projects on intangible assets and the statement of cash flows. Operating segments and pollutant pricing mechanisms projects could be added to the work plan if additional capacity becomes available.

The Group estimates that no standards, amendments and interpretations in the preceding table will have a significant impact on the consolidated carve-out financial statements in the initial period of application.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

4. SEGMENT INFORMATION

Under IFRS 8 (*Segment Information*), operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM") which, in the case of the Group, is the Managing Director of the Group. The CODM is responsible for allocating resources and assessing performance of the business. For management purposes, the Group's operating segments are formed by the Group's online business in Spain, Mexico, Colombia, Panama, Malta, Argentina Israel and Gibraltar.

The Managing Director measures the performance of the Group's business by its revenue and EBITDA, which is calculated as net income/(loss), after adding back income tax benefit/(expense), interest expense, depreciation and amortization.

The Group will report financial information, both internally and externally, based on the organizational structure approved by the Managing Director of the Group. Thus, the reportable segments for the 2022 consolidated carve-out financial statements are formed by the Group's operations in Spain, Mexico and Colombia. Panama, Argentina and Codere Online Operator LTD (Malta) are grouped under "Other operations". Codere Online Management Services LTD (Malta), Israel, United States, SEJO and Gibraltar have been grouped and reported under "Supporting". These entities aggregated under "Supporting" segment are not operating entities (only holding companies) to entities that only provide internal support services.

The entities that have been aggregated under "Other operations" and "Supporting" have been grouped in accordance with guidance allowed under IFRS 8, *Operating Segments*. Based on both IFRS 8:BC30 and the diagram included in the implementation guidance accompanying IFRS 8, if two or more components of a business meet the aggregation criteria, they may be combined for external reporting purposes into a single operating segment, notwithstanding that they may individually exceed the quantitative thresholds. Additionally, the entities aggregated in the "Other operations" and "Supporting" segments all meet the following conditions: (i) aggregation is consistent with the core principle of IFRS 8, (ii) the segments have similar economic characteristics, (iii) the segments are similar in the nature of the products and services offered, (iv) the segments are similar in the nature of their production processes, (v) the segments are similar in the type or class of customer for their products and services, (vi) the segments have similar methods used to distribute their products and provide their services and (vii) the segments have a similar nature of their regulatory environment. The segments referred to above include the information related to the online business provided in each country. Inter-segment transactions are carried out on an arm's length basis and are included in the "Eliminations" column. Information relating to other Group companies not specifically included in these segments is reported under "Other Operations".

The following tables break down certain of the information presented in the consolidated carve-out income statement for the years ended December 31, 2022, 2021 and 2020 by the Group's operating segments (amounts expressed in thousands of euros).

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2022** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Group** |
| **Revenue** | **60043** | **45518** | **7007** | **3179** | **56310** | **(56310)** | **115747** |
| Personnel expenses | (559) | (1184) | (178) | (875) | (12505) |  | **(15301)** |
| Depreciation and amortization | (51) | (21) | (4) | (125) | (355) |  | **(556)** |
| Other operating expenses | (53521) | (74074) | (14315) | (9383) | (60770) | 56298 | **(155765)** |
| **Operating expenses** | **(54131)** | **(75279)** | **(14497)** | **(10383)** | **(73630)** | **56298** | **(171622)** |
| **OPERATING INCOME/(LOSS)** | **5912** | **(29761)** | **(7490)** | **(7204)** | **(17320)** | **(12)** | **(55875)** |
| Finance income | 256 | 3366 | 1477 | 1344 | 25327 | (6667) | **25103** |
| Finance costs | (1) | (2724) | (1776) | 290 | (57385) | 48953 | **(12643)** |
| **Net financial results** | **255** | **642** | **(299)** | **1634** | **(32058)** | **42286** | **12460** |
| **NET INCOME/(LOSS) BEFORE TAX** | **6167** | **(29119)** | **(7789)** | **(5570)** | **(49378)** | **42274** | **(43415)** |
| Income tax benefit/(expense) | (576) | 10 | (4) | (4) | (2406) | 12 | **(2968)** |
| **NET INCOME/(LOSS) FOR THE YEAR** | **5591** | **(29109)** | **(7793)** | **(5574)** | **(51784)** | **42286** | **(46383)** |
| Attributable to equity holders of the Parent | 5591 | (29108) | (7793) | (5574) | (51784) | 42286 | **(46382)** |
| Attributable to non-controlling interests |  | (1) |  |  |  |  | **(1)** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2021** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Group** |
| **Revenue** | **49753** | **24908** | **3976** | **989** | **39547** | **(38920)** | **80253** |
| Personnel expenses | (359) | (407) | (95) | (283) | (5934) | (2) | **(7080)** |
| Depreciation and amortization | (150) | (7) | (3) | (100) | (462) | 1 | **(721)** |
| Other operating expenses (\*) | (47947) | (36812) | (7853) | (2314) | (51615) | 3060 | **(143481)** |
| **Operating expenses** | **(48456)** | **(37226)** | **(7951)** | **(2697)** | **(58011)** | **3059** | **(151282)** |
| **OPERATING INCOME/(LOSS)** | **1297** | **(12318)** | **(3975)** | **(1708)** | **(18464)** | **(35861)** | **(71029)** |
| Finance income | (5) | 242 | 4 | 32 | 14437 | (10167) | **4543** |
| Finance costs | - | (7) | (28) | (2) | (10649) | 10125 | **(561)** |
| **Net financial results** | **(5)** | **235** | **(24)** | **30** | **3788** | **(42)** | **3982** |
| **NET INCOME/(LOSS) BEFORE TAX** | **1292** | **(12083)** | **(3999)** | **(1678)** | **(14676)** | **(35903)** | **(67047)** |
| Income tax benefit/(expense) | (68) | - | - | (7) | (891) | - | **(966)** |
| **NET INCOME/(LOSS) FOR THE YEAR** | **1224** | **(12083)** | **(3999)** | **(1685)** | **(15567)** | **(35903)** | **(68013)** |
| Attributable to equity holders of the Parent | 1224 | (12083) | (3999) | (1685) | (15567) | (35957) | **(68067)** |
| Attributable to non-controlling interests |  |  |  |  |  | 54 | **54** |

---

\* Include the transaction costs of the Business Combination as described in Note 2.

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2020** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Group** |
| **Revenue** | **48279** | **18422** | **2355** | **329** | **31046** | **(29934)** | **70497** |
| Personnel expenses | (275) | (18) | (108) | (174) | (4582) |  | **(5157)** |
| Depreciation and amortization | (470) | (1) | (2) | (3) | (456) |  | **(932)** |
| Other operating expenses | (43230) | (26277) | (3497) | (289) | (35298) | 29934 | **(78657)** |
| **Operating expenses** | **(43975)** | **(26296)** | **(3607)** | **(466)** | **(40336)** | **29934** | **(84746)** |
| **OPERATING INCOME/(LOSS)** | **4304** | **(7874)** | **(1252)** | **(137)** | **(9290)** | **-** | **(14249)** |
| Finance income |  |  |  |  | 602 | (434) | **168** |
| Finance costs | (332) | 7 | - | (101) | (696) | 434 | **(688)** |
| **Net financial results** | **(332)** | **7** | **-** | **(101)** | **(94)** | **-** | **(520)** |
| **NET INCOME/(LOSS) BEFORE TAX** | **3972** | **(7867)** | **(1252)** | **(238)** | **(9384)** | **-** | **(14769)** |
| Income tax benefit/(expense) | (1077) | - | - | 118 | (551) | - | **(1510)** |
| **NET INCOME/(LOSS) FOR THE YEAR** | **2895** | **(7867)** | **(1252)** | **(120)** | **(9935)** | **-** | **(16279)** |
| Attributable to equity holders of the Parent | 2895 | (7867) | (1252) | (115) | (9935) |  | **(16274)** |
| Attributable to non-controlling interests |  |  |  | (5) |  | **-** | **(5)** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The following tables break down certain of the information presented in the consolidated statement of financial position as of December 31, 2022 and in the carve-out statement of financial position as of December 31, 2021 by the Group's operating segments (amounts expressed in thousands of euros).

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2022** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Group** |
| **Non-current assets** | **29** | **70** | **7** | **38** | **111129** | **(110290)** | **983** |
| **Current assets** | **31665** | **4787** | **5133** | **2594** | **180924** | **(156778)** | **68325** |
| Trade receivables and other current assets | 13460 | 2132 | 3261 | 742 | 33814 | (45667) | **7742** |
| Current financial assets | 10476 | 1995 | 873 | 696 | 103816 | (111081) | **6775** |
| Cash and cash equivalents | 7729 | 660 | 999 | 1156 | 43294 | (30) | **53808** |
| **Total Assets** | **31694** | **4857** | **5140** | **2632** | **292053** | **(267068)** | **69308** |
| **EQUITY** | **19883** | **(47067)** | **(1554)** | **(6057)** | **169899** | **(110557)** | **24547** |
| **NON-CURRENT LIABILITIES** | **-** | **-** | **-** | **-** | **2008** | **-** | **2008** |
| **CURRENT LIABILITIES** | **11811** | **51924** | **6694** | **8689** | **120146** | **(156511)** | **42753** |
| Lease obligations |  |  |  |  |  |  | **-** |
| Provisions |  |  |  |  |  |  | **-** |
| Borrowings | 306 | 37657 | 68 | 6251 | 99986 | (140025) | **4243** |
| Trade payables and other current liabilities | 11505 | 14267 | 6626 | 2438 | 20160 | (16486) | **38510** |
| **Total EQUITY AND LIABILITIES** | **31694** | **4857** | **5140** | **2632** | **292053** | **(267068)** | **69308** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **12/31/2021** | **Spain** | **Mexico** | **Colombia** | **Other<br> Operations** | **Supporting** | **Eliminations** | **Total<br> Group** |
| **Non-current assets** | **73** | **29** | **9** | **107** | **97854** | **(97466)** | **606** |
| **Current assets** | **23831** | **5392** | **3715** | **1919** | **161851** | **(92039)** | **104669** |
| Trade receivables and other current assets | 13353 | 1734 | 1337 | 559 | 37720 | (48841) | **5862** |
| Current financial assets | 7022 | 1084 | 798 | 329 | 37833 | (43167) | **3899** |
| Cash and cash equivalents | 3456 | 2574 | 1580 | 1031 | 86298 | (31) | **94908** |
| **Total Assets** | **23904** | **5421** | **3724** | **2026** | **259705** | **(189505)** | **105275** |
| **EQUITY** | **14259** | **(15494)** | **(3990)** | **(799)** | **172734** | **(98556)** | **68154** |
| **NON-CURRENT LIABILITIES** | **-** | **-** | **-** | **-** | **5513** | **-** | **5513** |
| **CURRENT LIABILITIES** | **9645** | **20915** | **7714** | **2825** | **81458** | **(90949)** | **31608** |
| Lease obligations |  |  |  |  |  |  | **-** |
| Provisions |  |  |  |  |  |  | **-** |
| Borrowings | 1776 | 1209 | 2077 | 577 | 62647 | (65302) | **2984** |
| Trade payables and other current liabilities | 7869 | 19706 | 5637 | 2248 | 18811 | (25647) | **28624** |
| **Total EQUITY AND LIABILITIES** | **23904** | **5421** | **3724** | **2026** | **259705** | **(189505)** | **105275** |

---

The Group does not have any customers that individually account for 10% or more of its interest and income for the years ended December 31, 2022 and 2021.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

5. INTANGIBLE ASSETS

The table below reconciles the carrying amounts of "Intangible assets" at the beginning and end of the reporting periods:

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2021** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2022** |
| Service concession arrangement | 200 |  | (200) |  |
| Software | 4392 | 17 | - | 4409 |
| **Total Cost** | **4592** | **17** | **(200)** | **4409** |
| ***Accumulated amortization (Note 13)*** |  |  |  |  |
| Service concession arrangement | (103) | (97) | 200 |  |
| Software | (4020) | (379) | - | (4399) |
| **Total Amortization** | **(4123)** | **(476)** | **200** | **(4399)** |
| **Total Carrying amount** | **469** | **(459)** | **-** | **10** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2020** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2021** |
| Service concession arrangement | 200 |  |  | 200 |
| Software | 4392 | - |  | 4392 |
| **Total Cost** | **4592** | **-** |  | **4592** |
| ***Accumulated amortization (Note 13)*** |  |  |  |  |
| Service concession arrangement | (3) | (100) |  | (103) |
| Software | (3461) | (559) |  | (4020) |
| **Total Amortization** | **(3464)** | **(659)** |  | **(4123)** |
| **Total Carrying amount** | **1128** | **(659)** |  | **469** |

---

The service concession arrangement total derecognition for 200 thousand is caused by the liquidation of the Italian subsidiary (Codere Scommese S.R.L.) because the Group's service concession contract included a service concession contract acquired in Italy that granted rights to economic benefits for the online business.

The gross cost, accumulated amortization and impairment losses of intangible assets as of December 31, 2022, 2021 and January 1, 2021 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Balance as of 12/31/2022** | **Useful life**<br> **(in years)** | **Accumulated<br> amortization**  | **Gross cost** | **Accumulated<br> amortization** | **Impairment<br> losses** | **Intangible<br> assets** |
| Software | 4 | Straight line | 4409 | (4399) |  | 10 |
| **Total intangible assets** |  |  | **4409** | **(4399)** |  | **10** |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Balance as of 12/31/2021** | **Useful life**<br> **(in years)** | **Accumulated<br> amortization**  | **Gross cost** | **Accumulated<br> amortization** | **Impairment<br> losses** | **Intangible<br> assets** |
| Service concession arrangement |  |  | 200 | (103) |  | 97 |
| &nbsp;&nbsp;&nbsp;*Of which:<br> with definite useful life* | *2* | *Straight line* | *200* | *(103)* |  | *97* |
| Software | 4 | Straight line | 4392 | (4020) |  | 372 |
| **Total intangible assets** |  |  | **4592** | **(4123)** |  | **469** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

6. PROPERTY, PLANT AND EQUIPMENT

The reconciliation of the carrying amounts of the items comprising "Property, plant and equipment" at the beginning and end of the reporting period:

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2021** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2022** |
| Machinery and equipment | 247 | 147 |  | 394 |
| Other fixtures, fittings and tools | 10 | - |  | 10 |
| **Total** | **257** | **147** |  | **404** |
| ***Accumulated depreciation (Note 13)*** |  |  |  |  |
| Machinery and equipment | (121) | (79) |  | (200) |
| Other fixtures, fittings and tools | (3) | (1) |  | (4) |
| **Total** | **(124)** | **(80)** |  | **(204)** |
| **Carrying amount** | **133** | **67** |  | **200** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| ***Cost*** | **Balance at<br> 12/31/2020** | **Additions** | **Derecognitions** | **Balance at<br> 12/31/2021** |
| Machinery and equipment | 167 | 80 |  | 247 |
| Other fixtures, fittings and tools | 10 | - |  | 10 |
| **Total** | **177** | **80** |  | **257** |
| ***Accumulated depreciation (Note 13)*** |  |  |  |  |
| Machinery and equipment | (68) | (53) |  | (121) |
| Other fixtures, fittings and tools | (2) | (1) |  | (3) |
| **Total** | **(70)** | **(54)** |  | **(124)** |
| **Carrying amount** | **107** | **26** |  | **133** |

---

Additions in 2022 and 2021 mainly correspond to new machines and equipment in Colombia, Argentina, Spain and Mexico.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

7. FINANCIAL ASSETS

The breakdown of the carrying amount of the items presented under this heading at December 31, 2022 and 2021 is as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2022** | **Debt<br> Instruments** | <br>**Carrying<br> Amount** | <br>**Fair Value** |
| **Current financial assets:** | **68325** | **68325** | **68325** |
| Trade receivables and other current assets (Note 8) | 7742 | 7742 | 7742 |
| Current financial assets | 6775 | 6775 | 6775 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*with related parties (Note 14)* |  |  |  |
| Cash and cash equivalents | 53808 | 53808 | 53808 |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2021** | **Debt<br> Instruments** |<br>**Carrying<br> Amount** |<br>**Fair Value** |
| **Current financial assets:** | **104669** | **104513** | **104513** |
| Trade receivables and other current assets (Note 8) | 5862 | 5706 | 5706 |
| Current financial assets | 3899 | 3899 | 3899 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*with related parties (Note 14)* | *76* | *76* | *76* |
| Cash and cash equivalents | 94908 | 94908 | 94908 |

---

Cash and cash equivalents as of December 31, 2022 decreased by €41,100 thousand compared to December 31, 2021 mainly due the 2022 Operating loss and the lack of financing activities in the period.

As of December 31, 2021 Cash and cash equivalents mainly include the cash received as a result of the 2021 Merger described in Note 1 of €89,366 thousand in exchange of shares of the Company.

Cash and cash equivalents also include restricted cash related to Spanish clients where the regulation obliges the Group to maintain 1 euro as restricted cash for each euro the customer has in the virtual wallet. As of December 31, 2022 and 2021 it amounted to €4,829 and €3,548 thousand, respectively.

Trade receivables and other current assets include deposits made by customers through retail sport betting terminals, owned by other entities of Codere Group, to its virtual wallets amounting to €3,357 and €1,926 thousand as of December 31, 2022 and 2021, respectively.

Current financial assets mainly correspond to deposits made by customers through payment service providers to its virtual wallets amounting to €6,455 and €3,728 thousand as of December 31, 2022 and 2021, respectively. These deposits are normally settled and appear in the online account between one to fifteen days after the transaction, depending on each payment service provider and are recognized as current financial assets.

Current financial assets from related parties correspond to the tax returns from Codere Group, by which the Group has not recognized any receivable as of December 31, 2022 and has recognized a receivable amounting to €76 thousand (see Note 14) as of December 31, 2021. These receivables are normally recognized as current financial assets.

The expected credit losses recognized on current financial assets as of December 31, 2022 and 2021 amounted to €138 and €55 thousand, respectively.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

8. TRADE RECEIVABLES AND OTHER CURRENT ASSETS

The breakdown of the items presented under this heading at December 31, 2022 and 2021 is as follows:

---

| | | |
|:---|:---|:---|
|  | **12/31/2022** | **12/31/2021** |
| **Trade receivables:** |  |  |
| Other receivables from the Codere Group companies (Note 14) | 4309 | 3318 |
| Impairment of trade receivables | (99) | (34) |
| **Other current assets:** |  |  |
| Current tax asset (VAT) | 2793 | 1523 |
| Prepayments | 677 | 739 |
| Other receivables | 62 | 316 |
| **Total** | **7742** | **5862** |

---

Other receivables from the Codere Group companies mainly include balances to be paid by Latin American ("Latam") retail companies from Codere Group amounting to €4,197 thousand and €2,405 thousand as of December 31, 2022 and December 31, 2021, respectively.

The carrying amounts of the Group's trade receivables and other current assets are denominated in the following currencies:

---

| | | |
|:---|:---|:---|
| ***Currency*** | **12/31/2022** | **12/31/2021** |
| EUR | 1580 | 2139 |
| ILS | 61 | 150 |
| ARS | 365 | 290 |
| USD | 343 | 212 |
| MXN | 2132 | 1734 |
| COP | 3261 | 1337 |
| **Total** | **7742** | **5862** |

---

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The Group does not hold any collateral as security.

The movement in the allowance for impairment of trade receivables as of December 31, 2022, 2021 and 2020 is as follows:

---

| | |
|:---|:---|
| **** |  |
| **Expected credit loss as of 01/01/2020** | **30** |
| Additions | 71 |
| Reversal | - |
| **Expected credit loss as of 12/31/2020** | **101** |
| Additions |  |
| Reversal | (67) |
| **Expected credit loss as of 12/31/2021** | **34** |
| Additions | 65 |
| Reversal | - |
| **Expected credit loss as of 12/31/2022** | **99** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

9. EQUITY

Before the Business Combination, SEJO was the holding company of Codere Online Business with €60 thousand share capital. On June 4, 2021, the Company was created as described in Note 1 with an initial share capital amounting to €30 thousand divided into 30 thousand ordinary shares with a nominal value of one euro each (€1), all of which are fully paid up. As of December 31, 2021, the share capital of the Group amounted to €45,121,956 divided into 45,121,956 shares as a result of the capital increases in connection with the Business Combination. These 2021 capital increases correspond to the steps mentioned above in Note 1:

● Exchange: the transfer of SEJO to the Company, in exchange for 29,970,000 of additional newly issued ordinary shares of the Company, which were subscribed for by CNEW.

● Merger: the contribution of all shares of DD3 Class A Common Stock issued and outstanding immediately prior to the merger to the Company in exchange for 15,121,956 ordinary shares of the Company.

See the table below for a summary of Parent's ownership:

---

| | | |
|:---|:---|:---|
|  | **Shares** | **Percentage** |
| Ordinary shares held by public stockholders | 3915956 | 8.7% |
| Ordinary shares issued to the sponsor and its permitted transferees | 3421000 | 7.6% |
| Ordinary shares issued to forward purchasers and permitted transferees | 6074000 | 13.5% |
| Ordinary shares issued to the subscribers and their permitted transferees | 1711000 | 3.8% |
| Ordinary shares held by CNEW | 30000000 | 66.5% |
| **Parent ordinary shares outstanding** | **45121956** | **100%** |

---

The 2021 movement in Net Parent Investment represents:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Pursuant to the Business Combination Agreement, prior to the effective time of the Merger, CNEW and SEJO capitalized all outstanding liabilities of SEJO and its subsidiaries due to CNEW or any of its subsidiaries so that at the time of the Merger neither SEJO nor any of its subsidiaries had any liability outstanding. During 2021, the following liability conversion into equity took place amounting to €55.3 million:

● Codere España S.A. and SEJO for €28.1 million (€27.8 million correspond to the borrowings and €0.3 million correspond to the trade payables).

● CNEW and SEJO for €13.9 million (€9.3 million correspond to the borrowings and €4.6 million correspond to the trade payables).

● Codere Scommesse S.R.L. and Codere Italy S.A.U. for €1.0 million correspond to the borrowings.

● Latam companies for €2.8 million correspond to the trade payables.

● Codere Online Management Services LTD and related parties of Codere Group for €4.8 million correspond to the trade payables.

The Net Parent Investment also includes the listing costs supported by CNEW as explained in Note 2 as parent contribution for €4.6 million in these consolidated carve-out financial statements.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

ii) The impacts of the SEJO contribution.

The SEJO contribution to Parent made by CNEW as of November 29, 2021 as part of the Business Combination has been registered based on the consolidated accounting balances of SEJO sub-consolidated balance sheet as of the date of the transaction, as it is considered to be a reorganization under common control. For the purposes of the equity movements presented in these consolidated carve-out financial statements, as the historical values of SEJO were already presented as predecessor values as of December 31, 2020, the impact is only a reclassification from other reserves to issued capital amounting to €29,970 thousand related to the 29,970,000 new shares issued to Codere Newco at €1 nominal value.

iii) The incorporation of the new parent as of June 4, 2021

As explained in Note 1, the historical financial statements for the years ended December 31, 2019 and 2020 were presented based on the former structure of the Codere Online Business prior to the Business Combination, where SEJO was the holding company. As a result of the Exchange, the Company became the parent of the Group, and consequently, the €30 thousand of issued capital paid upon incorporation of the Company would arise as Issued capital in the consolidated carve-out financial statements.

iv) The impacts of the DD3 contribution

The DD3 contribution as part of the Business Combination made as of November 30, 2021 implied an exchange of additional 15,121,956 shares issued to DD3 shareholders at €1 nominal value in exchange for the same number of shares outstanding from DD3, immediately before the merge with Codere Online U.S. Corp. The total 15,121,956 shares of DD3 included 8,407,025 shares remaining after redemptions, and additional 6,435,000 shares issued just before the business combination to PIPE investors, as part of the commitments included in the Business Combination.

The transaction with DD3 has been, partly, treated as a shared-based payment transaction that falls under IFRS 2, with the difference between the fair value of DD3 shares issued prior to the PIPE additional contribution, (was derived from quoted prices (Level 1)), which amounted to €79,145 thousand, and the fair value of the identifiable net assets of DD3 at that time, amounting to €43,300 thousand, being recorded as an expense of €35,845 thousand in the consolidated carve-out income statement, representing the costs associated with the listing process. See the table with the calculations below:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | | **Per Share** | **Per Share** | **Assuming Real Redemption** | **Assuming Real Redemption** | **Assuming Real Redemption** | **Assuming Real Redemption** |
| <br>***(in thousands except for share data)*** | **Per Share**<br>**Value<br> USD** | **Value<br> EUR (\*)** | **Value<br> EUR (\*)** | **Shares** | **Fair Value**<br> **(in USD)** | **Fair Value<br> (in EUR)** | **Fair Value<br> (in EUR)** |
| Class A common shares | $9.42 | € | 8.29 | 8407025 | $79194 | € | 69695 |
| Warrants | $1.66 | € | 1.46 | 6435000 | $10682 | € | 9450 |
|  |  |  |  | 14842025 | $89876 | € | 79145 |
| Fair Value |  |  |  |  |  | € | 43300 |
| Excess of fair value (listing costs) |  |  |  |  |  | € | 35845 |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

In addition to that, the financial assets and financial liabilities incorporated as part of DD3 contribution, which included cash and warrants respectively, have been accounted under IAS 32. The total equity impact recognized in relation to DD3 contribution, accounted based on both IFRS 2 and IAS 32 standards as previously explained, is summarized as follows, with counterpart being the €35,845 thousand of service costs and €102,425 thousand assets of cash, net of €9,450 thousand of warrant liabilities:

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Shares** | **Cash USD** | **Cash Euro** | **Cash Euro** | **Issued Capital<br> (EUR)** | **Issued Capital<br> (EUR)** | **Share Premium<br> (EUR)** | **Share Premium<br> (EUR)** | **Total Equity<br> (EUR)** | **Total Equity<br> (EUR)** |
| Total shares after redemptions | 8407025 | $49177 | € | 43300 | € | 8407 | € | 61288 | € | 69695 |
| Additional shares issued to PIPE investors | 6714931 | $67149 | € | 59124 | € | 6715 | € | 52410 | € | 59124 |
| **Total shares issued to DD3 shareholders** | **15121956** | $**116327** | **€** | **102425** | **€** | **15122** | **€** | **113697** | € | **128819** |

---

---

| | |
|:---|:---|
| (\*) | Spot rate to convert from USD to EUR as of November 30, 2021 was €0.8805 per US$1.00. |

---

In addition, the share premium incorporated as part of DD3 contribution have been reduced by the transaction costs supporting by CNEW as detailed below:

---

| | |
|:---|:---|
|  | **Thousands of<br> EUR** |
| Transaction costs supported by CNEW | 4648 |
| % equity interest held by DD3 (33%) | 1557 |
| **Attributable transaction costs to share premium** | **1557** |

---

In addition to the above impacts associated with the capital increase, additional transaction costs attributable to DD3 capital increase amounting to €5,220 thousand, have been deducted from share premium.

As of December 31, 2022 the Employee share-based compensation in Other reserves, amounted to €3,369 thousand, mainly related to the management incentive plan described in Note 17.

As of December 31, 2022 the Other movements allocated in Other reserves that amounted to €898 thousand correspond to an adjustment that reflects the forgiveness of the Cost of Doing Business debt from Codere Group to Codere in 2022.

**Equity attributable to non-controlling interest** as of December 31, 2022 and December 31, 2021 amounted to €145 and €146 thousand, respectively, which represents 25% of minority shareholder's interest in the historical online business activity the Group has carried out through Hipica de Panama S.A. until October 1, 2021. From December 31, 2021, Panama is 100% controlled by the Company. Currently, the only entity that is not 100% controlled by the Company is LIFO AenP (Mexico), in which it has the 99.99% of the ownership.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

10. BORROWINGS AND NON-CURRENT FINANCIAL LIABILITIES

As of December 31, 2022, and 2021 the breakdown of financial instruments by category is as follows:

Current borrowings at amortized cost

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| ****<br>**12/31/2022** | **Debt<br> Instruments** |<br>**Carrying<br> Amount** |<br>**Fair Value** |
| **Current financial liabilities** | **4243** | **4243** | **4243** |
| Other borrowings | 4243 | 4243 | 4243 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*with related parties (Note 14)* | *4243* | *4243* | *4243* |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized Cost** | | |
| <br>**12/31/2021** | **Debt<br> Instruments** |<br>**Carrying<br> Amount** |<br>**Fair Value** |
| **Current financial liabilities** | **2984** | **2984** | **2984** |
| Other borrowings | 2984 | 2984 | 2984 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*with related parties (Note 14)* | *2919* | *2919* | *2919* |

---

Other borrowings correspond to short-term loans, mainly composed of debt with entities from the Codere Group and amounted to €4,243 and €2,919 thousand as of December 31, 2022 and 2021, respectively.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

Non-current borrowings at amortized cost

There were no non-current borrowings accounted for at amortized cost as of December 31, 2022 and December 31, 2021 as result of the liability conversion into equity during 2021.

The breakdown of the residual maturity contractual undiscounted cash flows of the borrowings of the Group as of December 31, 2022 and 2021, was as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | **Non-current** | **Non-current** | **Non-current** | **Non-current** | **Non-current** | | |
| <br>**December 31, 2022** |<br>**Current<br> 2023** | **2024** | **2025** | **2026** | **2027** | **Subsequent<br> years** |<br>**Non-current** |<br>**Total** |
| Loans |  |  |  |  |  |  |  |  |
| Other borrowings | 4243 |  |  |  |  |  |  | 4243 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*to related parties (Note 14)* | *4243* |  |  |  |  |  |  | *4243* |
| **Total** | **4243** |  |  |  |  |  |  | **4243** |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | **Non-current** | **Non-current** | **Non-current** | **Non-current** | **Non-current** | | |
| <br>**December 31, 2021** |<br>**Current<br> 2022** | **2023** | **2024** | **2025** | **2026** | **Subsequent<br> years** |<br>**Non-current** |<br>**Total** |
| Loans |  |  |  |  |  |  |  |  |
| Other borrowings | 2984 |  |  |  |  |  |  | 2984 |
| &nbsp;&nbsp;&nbsp;*Of which:* |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*to related parties (Note 14)* | *2919* |  |  |  |  |  |  | *2919* |
| **Total** | **2984** |  |  |  |  |  |  | **2984** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**Other borrowings associated with financing activities**

The following charts present details regarding the changes in other borrowings in 2022 and 2021 that arose from financial activities:

**2022**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Balance at<br> 12/31/2021** | **Drawdown of<br> related party<br> debt** | **Related party<br> non-cash<br> payable** | **Related party<br> non-cash<br> settlement** | **Foreign<br> exchange<br> movement** | **Changes in<br> fair value** | **Balance at<br> 12/31/2022** |
| Loans |  |  |  |  |  |  |  |
| Other borrowings | 2984 |  | 1259 |  |  |  | 4243 |
| **Total** | **2984** |  | **1259** |  |  |  | **4243** |

---

**2021**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Balance at<br> 12/31/2020** | **Drawdown of<br> related party<br> debt** | **Related party<br> non-cash<br> payable** | **Related party<br> non-cash<br> settlement** | **Foreign<br> exchange<br> movement** | **Changes in<br> fair value** | **Balance at<br> 12/31/2021** |
| Loans | 21441 |  |  | (21441) |  |  |  |
| Other borrowings | 17777 | 450 | 1845 | (17088) |  |  | 2984 |
| **Total** | **39218** | **450** | **1845** | **(38529)** |  |  | **2984** |

---

As described in Note 9, the debt conversion into equity during 2021 through borrowings amounted to €38.5 million.

Non-current financial liabilities

As of December 31, 2022, non-current financial liabilities included warrants accounted for as liabilities. The fair value of the warrants was derived from quoted prices (Level 1).

As of the date of the Business Combination on November 30, 2021, the market price of each warrant was approximately €1.46 per warrant or €9,450 thousand in the aggregate. As of December 31, 2021, the market price decreased to approximately €0.86 per warrant; therefore, as of December 31, 2021, the fair value of the warrant liabilities amounted to €5,513 thousand. As of December 31, 2022, the market price decreased to approximately €0.20 per warrant; therefore, as of December 31, 2022, the fair value of the warrant liabilities amounted to €1,298 thousand. The change in fair value of the warrants was recorded in the consolidated income statement as finance income amounting to €4,215 thousand for the year ended December 31, 2022.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**11.**  **<u>TRADE PAYABLES AND OTHER CURRENT LIABILITIES</u>** 

The composition of trade payables and other current liabilities as of December 31, 2022 and 2021 is as follows:

---

| | | |
|:---|:---|:---|
|  | **12/31/2022** | **12/31/2021** |
| Trade payables | 23791 | 19687 |
| Customer online wallets | 7034 | 4900 |
| Other current liabilities | 7685 | 3211 |
| Accruals | - | 826 |
| **Total** | **38510** | **28624** |
| *Of which: <br> with related parties (Note 14)* | *6497* | *3729* |

---

The customer online wallets are the net difference between funds deposited by customers, plus winning wagers, less losing wagers and less customers withdrawals.

Accruals include the Group's commitments to its staff under the labor legislation prevailing in each market as well as the labor contingencies recognized in each reporting period.

The details of other current liabilities as of December 31, 2022 and 2021 is as follows:

---

| | | |
|:---|:---|:---|
|  | **12/31/2022** | **12/31/2021** |
| Accrued salaries | 1874 | 640 |
| Current tax liabilities | 5756 | 2501 |
| Others | 55 | 70 |
| **Total** | **7685** | **3211** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

12. INCOME TAX MATTERS

Each of the entities included in the Group file income taxes according to the tax regulations in force in each country on an individual basis or under consolidation tax regulations.

The consolidated income tax has been calculated as an aggregation of income tax expenses of each individual company. In order to calculate the taxable income of the consolidated entities individually, the accounting profit is adjusted for permanent differences. At each consolidated income statement date, a current tax asset or liability is recorded, representing income taxes currently refundable or payable.

Income tax payable is the result of applying the applicable tax rate in force to each tax-paying entity, in accordance with the tax laws in force in the country in which the entity is registered.

As of December 31, 2022, it was approved by the tax authority the creation of the for tax consolidation group in Spain, that will be effective starting 2023

**Reconciliation of book net income/(loss) before taxes to taxable income**

The reconciliation between book net income/(loss) before tax and the income tax benefit/(expense) from continuing operations for the fiscal years ended December 31, 2022, 2021 and 2020 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| **Accounting net loss before tax** | **(43415)** | **(67047)** | **(14769)** |
| At Codere Online statutory income tax rate | 7381 | 11398 | 3692 |
| Tax effect unrecognized tax losses and permanent differences | (19486) | (17705) | (5395) |
| Utilisation of previously unrecognised tax losses |  | (1000) |  |
| Effect of different rates in different jurisdictions | 9137 | 6341 | 3095 |
| Adjustment of prior year taxes | - | - | 118 |
| **Income tax benefit/(expense)** | **(2968)** | **(966)** | **(1510)** |
| Effective tax rate | 7% | 1% | 10.22% |
| *Of which -* |  |  |  |
| Current tax expense | (3029) | (966) | (1510) |
| Deferred tax benefit/(expense) | 61 | - | - |
| **Total income tax benefit/(expense)** | **(2968)** | **(966)** | **(1510)** |

---

**Deferred taxes**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **12/31/2022** | **12/31/2022** | **12/31/2021** | **12/31/2021** |
| Deferred tax asset |  | 771 |  |  |
| Deferred tax liability | | 710 | | - |

---

The deferred tax asset generated as of December 31, 2022 due to the recognition of the long-term incentive plan impact as described in Note 17, and the deferred tax liability mainly due to the fluctuation of the exchange rates between the euro and the other currencies.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

As shown in the table below, the Group has generated net losses which can offset against future profits; however, as of December 31, 2021 and 2022, the Group did not recognize these considering it is not expected that these will be utilized within the foreseeable future. There is no limit on time in either country to utilize these losses against future profits.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Entity** | **Previous** | **2020** | **2021** | **2022** | **Total as of<br> 12/31/2022** |
| SEJO | - | - | 9355 | 4224 | 13579 |
| Codere Online S.A.U. (Spain) | 2639 | - | - | - | 2639 |
| Codere Online Management Services LTD (Malta) | 5971 | 9592 | 9051 | 12356 | 36970 |
| LIFO AenP (Mexico) | - | - | 343 | 25006 | 25349 |
| Codere Online Luxembourg, S.A. | - | - | - | - | - |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Entity** | **Previous** | **2019** | **2020** | **2021** | **Total as of<br> 12/31/2021** |
| SEJO | - | - | - | 9355 | 9355 |
| Codere Online S.A.U. (Spain) | 1854 | 785 | - | - | 2639 |
| Codere Online Management Services LTD (Malta) | - | 5971 | 9592 | 9051 | 24614 |
| LIFO AenP (Mexico) |  |  |  | 343 | 343 |
| Codere Online Luxembourg, S.A. | - | - | - | - | - |

---

It is important to mention that the Group belonged to a tax consolidation group in Spain in the first three quarters of the year 2021. In the last quarter of 2021, the Group ceased to belong to the tax consolidation group and made all the tax payments.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

13. REVENUE AND EXPENSES

**Revenue**

The breakdown of the Group's revenues is as follows:

---

| | | | |
|:---|:---|:---|:---|
| **** | **2022** | **2021** | **2020** |
| Online sports betting | 58470 | 45875 | 39719 |
| Online casino wagering | 57277 | 34178 | 30778 |
| Others | - | 200 | - |
| **Total** | **115747** | **80253** | **70497** |

---

In 2021 Others represented the disposition of the Greenplay brand in exchange for 200 thousand euros pursuant to an asset purchase agreement between the Group and Aspire to Vita Media Group ApS on December 31, 2021.

No customer contributed more than 10% of revenue for the years ended December 31, 2022, 2021 and 2020.

Additionally, the distribution of sales by geographical market during the reporting period is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| Spain | 60043 | 49753 | 48279 |
| Mexico | 45518 | 24908 | 18422 |
| Colombia | 7007 | 3976 | 2355 |
| Argentina | 1077 |  |  |
| Others | 2102 | 1616 | 1441 |
| **Total** | **115747** | **80253** | **70497** |

---

**Personnel expenses**

The heading personnel expenses for the 2022, 2021 and 2020 periods include expenses for wages, salaries, benefits (and other similar concepts) and social security and other social contributions expenses payable by the Group.

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| Wages, salaries and similar | 9363 | 6248 | 4483 |
| Social security contributions payable by the Group | 790 | 425 | 280 |
| Other social contributions | 5148 | 407 | 394 |
| **Total** | **15301** | **7080** | **5157** |

---

The personnel expenses increase in the 2022 period is due to the approval by the company of the Management Incentive Plan in 2022 described in Note 17 and for the increase in personnel number.

Other social contribution includes those expenses resulting from the LTIP executive bonus amounting to 3,369 thousand euro in 2022.

**Depreciation and amortization**

The breakdown of depreciation and amortization for the years ended December 31, 2022, 2021 and 2020 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| Depreciation of property, plant and equipment (Note 6) | 80 | 54 | 40 |
| Amortization of intangible assets (Note 5) | 476 | 659 | 883 |
| Amortization of right-of-use assets | - | 8 | 9 |
| **Total** | **556** | **721** | **932** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**Other operating expenses**

The breakdown of other operating expenses for the years ended December 31, 2022, 2021 and 2020 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| Gambling taxes | 11529 | 8440 | 8867 |
| Leases | 526 | 596 | 575 |
| Utilities, repairs and maintenance | 1059 | 793 | 1258 |
| Professional services and other expenses | 49396 | 35905 | 28639 |
| Listing and transaction costs |  | 45509 |  |
| Casino license royalties | 4843 | 4024 | 4255 |
| Marketing expenses | 88412 | 48214 | 35063 |
| **Total** | **155765** | **143481** | **78657** |

---

The Group recognizes lease payments as an operating expense on a straight-line basis over the term of the lease for the short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value.

Professional services and other expenses in 2022, 2021 and 2020 mainly include: (i) streaming services contracted to external parties offered to our customers as complement to our sports complete betting offer, (ii) the payment processing which allows our customers to deposit and withdraw money using user-friendly platforms from payment processing providers and (iii) some of our less popular sports odds hired to external providers. Additionally, included within this heading are certain other expenses, such as those relating to marketing and customer relationship management ("CRM") tools.

Included within listing and transaction costs in 2021 is the cost of the listing of €35.8 million related to the Merger and recorded as a share-based payment in accordance with IFRS 2 (see Notes 2 and 9) and the net transaction costs associated with the Business Combination amounting to €9.6 million, of which €6.6 million were assumed by Codere Online and €3.0 million were assumed by CNEW.

**Finance income / (cost)**

The breakdown of finance income for the year ended December 31, 2022, 2021 and 2020 is as follows

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2021** | **2020** |
| Interest Income/(Expenses) | 88 | (6) |  |
| Exchange rate impact | 5828 | (50) | (520) |
| Argentina Hyperinflation Impact | 2265 | 70 |  |
| Decrease/(Increase) in Fair Value of Public Warrants (note 10) | 4215 | 3937 |  |
| Impact of IFRS 9 on accounting for financial instruments, including impairment\* | (149) | 31 |  |
| Others | 213 | - | - |
| **Total** | **12460** | **3982** | **(520)** |

---

\* Impact of IFRS 9 on accounting for financial instruments, including impairment is the result of adding, Impairment of trade receivables, Current financial assets and cash equivalents.

Regarding the finance income/(cost) for the year ended December 31, 2022 and 2021 primarily relates to the change in the fair value of the warrants from the date of transfer, November 30, 2021, to the end of the year, which amounted to €4,215 and €3,937 thousand, respectively. Additionally, included in this heading for the years ended December 31, 2022, 2021 and 2020 is both realized and unrealized foreign exchange gains/(losses) that have been created due to the fluctuation of the exchange rates between the euro and the other currencies, mainly the Mexican peso, the Colombian peso, Argentine peso and the Panamanian balboa, that the Group uses in its operations as well as interest expense related to the Group's outstanding borrowings from related parties.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**Earnings per share**

Basic earnings per share amounts are calculated by dividing (a) the net income/(loss) for the year attributable to equity holders of the Parent by (b) the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net income/(loss) for the year attributable to ordinary equity holders of the Parent by the weighted average number of ordinary shares plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares, if any. The effect of warrants throughout 2021 qualified as antidilutive events. In accordance with IAS 33, antidilutive potential ordinary shares are disregarded in the calculation of diluted earnings per share.

As a result of the 2021 Business Combination, as described in Note 1, Codere Group has control of the Group through CNEW with approximately 66.5% of the total outstanding ordinary shares of Parent. The remaining shareholders of Parent, which include former DD3 shareholders and certain other investors, collectively hold the remaining 33.5% stake. As of December 31, 2022, Parent had 45,121,956 issued and outstanding shares.

Additionally, because IFRS requires that the calculation of basic and diluted earnings per share ("EPS") for all periods presented be adjusted retrospectively when the number of ordinary shares or potential ordinary shares outstanding increases as a result of a capitalization, bond issue, or share split, or decreases as a result of a reverse share split, EPS calculations for the reporting period and the comparative period should be based on the new number of shares. Therefore, as a result of the issuance of new shares on November 30, 2021, earnings per share has also been adjusted for all periods presented to reflect the number of shares issued and outstanding giving an amount of 45,121,956 for the years 2022 and 2021, and an amount of 30,006,101 shares for the 2020 period, which corresponds to the amount of shares attributable to CNEW (66.5%) without giving effect to the capital contribution of the DD3 shareholders and the resources obtained by the Nasdaq listing described in the previous paragraph.

Both basic and diluted earnings per share attributable to equity holders of the Group are calculated based on the following data, in each case for the years ended December 31, 2022, 2021 and 2020:

---

| | | | |
|:---|:---|:---|:---|
|  | **12/31/2022** | **12/31/2021** | **12/31/2020** |
| Net income/(loss) attributable to the equity holders of the Parent (thousand euros) | (46382) | (68067) | (16274) |
| Weight average number of shares outstanding: |  |  |  |
| &nbsp;&nbsp;&nbsp;*Basic* | *45121956* | *6686432* | *4463482* |
| &nbsp;&nbsp;&nbsp;*Diluted* | *45121956* | *6686432* | *4463482* |
| **Basic earnings per share (euros)** | **(1.03)** | **(10.18)** | **(3.64)** |
| **Diluted earnings per share (euros)** | **(1.03)** | **(10.18)** | **(3.64)** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

14. RELATED PARTIES

The parties related to the Group include, in addition to its and Codere Group's subsidiaries, associates and jointly controlled entities, if any, the Group's key management personnel, as well as all individuals who are related to them by a family relationship, and the entities over which key management personnel may exercise significant influence or control. Balances and transactions between the Group and its subsidiaries, which are related parties of the Group, have been eliminated in consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below.

Transactions with Codere Group and related companies

**2022**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Finance<br> costs and<br> exchange differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group |  | (3645) | (3645) |
| Codere Newco S.A.U. | Parent of the Group |  | (9504) | (9423) |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group |  | (1520) | (1520) |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | (162) | (162) |
| Other retail companies | Subsidiary of Codere Group |  | (857) | (857) |
| Mexico retail companies | Subsidiary of Codere Group |  | (3456) | (3456) |
| Retail Latam | Subsidiary of Codere Group |  | (3365) | (3365) |

---

**Balance at 12/31/2022**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Current financial assets<br> (Note 7)** | **Trade receivables<br> (Note 8)** | **Current borrowings<br> (Note 10)** | **Trade payables<br> and other<br> current liabilities<br> (Note 11)** |
| Codere Newco S.A.U. | Parent of the Group |  | 3 | 8 | 1779 |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  |  |  |  |
| Codere Apuestas España S.L. | Subsidiary of Codere Group |  | 109 |  | 369 |
| Other retail companies | Subsidiary of Codere Group |  |  | 306 | 788 |
| Other latam retail companies | Subsidiary of Codere Group |  | 1034 | 3187 | 1497 |
| CCOL | Subsidiary of Codere Group |  | 2832 | 68 | 1953 |
| ACOR/HIPA | Subsidiary of Codere Group |  | 331 | 674 | 111 |
| **Total** |  |  | **4309** | **4243** | **6497** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Finance<br> costs and<br> exchange differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group |  | (4847) | (4847) |
| Codere Newco S.A.U. | Parent of the Group | (81) | (7418) | (7499) |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | (848) | (848) |
| Codere Italia S.P.A. | Subsidiary of Codere Group | (29) |  | (29) |
| Other retail companies | Subsidiary of Codere Group | - | (2084) | (2084) |

---

**Balance at 12/31/2021**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Current financial assets<br> (Note 7)** | **Trade receivables<br> (Note 8)** | **Current borrowings<br> (Note 10)** | **Trade payables<br> and other<br> current liabilities<br> (Note 11)** |
| Codere Newco S.A.U. | Parent of the Group |  | 937 |  | 1165 |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  |  |  | 468 |
| Codere Apuestas España S.L. | Subsidiary of Codere Group |  |  |  | 749 |
| King Bingo S.R.L. | Subsidiary of Codere Group |  | 1 |  | 3 |
| OBIN | Subsidiary of Codere Group | 26 | (18) |  |  |
| CTEC | Subsidiary of Codere Group | 50 |  |  |  |
| CITATI | Subsidiary of Codere Group |  | (7) |  |  |
| Other retail companies | Subsidiary of Codere Group |  |  | 1776 | 520 |
| Other Latam retail companies | Subsidiary of Codere Group | - | 2405 | 1143 | 824 |
| **Total** |  | **76** | **3318** | **2919** | **3729** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**2020**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Finance<br> costs and<br> exchange differences** | **Operating expenses** | **Total Costs** |
| Codere España S.A. | Subsidiary of Codere Group | (281) |  | (281) |
| Codere Newco S.A.U. | Parent of the Group | (12) | (3220) | (3232) |
| Codere Apuestas España S.L. | Subsidiary of Codere Group |  | (7066) | (7066) |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group |  | (1287) | (1287) |
| Codere Operadora de Apuestas S.L. | Subsidiary of Codere Group |  | (919) | (919) |
| Codere Apuestas S.A.U. | Subsidiary of Codere Group |  | (79) | (79) |
| Codere Italia S.P.A. | Subsidiary of Codere Group | (101) | (918) | (1019) |
| Administradora Mexicana del Hipódromo | Subsidiary of Codere Group |  | (4164) | (4164) |
| Other retail companies | Subsidiary of Codere Group | - | (534) | (534) |

---

**Balance at 12/31/2020**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Related Companies** | **Relation to the Group** | **Trade receivables<br> (Note 8)** | **Non-current borrowings<br> (Note 10)** | **Current borrowings<br> (Note 10)** | **Trade payables**<br> **and other<br> current liabilities<br> (Note 11)** |
| Codere Apuestas Galicia S.L. | Subsidiary of Codere Group | 463 |  |  |  |
| Codere Italia S.P.A. | Subsidiary of Codere Group | 435 |  | 1339 | 101 |
| King Bingo S.R.L. | Subsidiary of Codere Group | 2 |  |  |  |
| Codere España S.A. | Subsidiary of Codere Group |  | 21191 | 6644 | 281 |
| Codere Newco S.A.U. | Subsidiary of Codere Group |  | 250 | 9048 | 152 |
| Administradora Mexicana del Hipódromo | Subsidiary of Codere Group |  |  |  |  |
| Other retail companies | Subsidiary of Codere Group | 36 |  | 746 | 945 |
| Other Latam retail companies | Subsidiary of Codere Group | - | - | - | - |
| **Total** |  | **936** | **21441** | **17777** | **1479** |

---

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

As described in Note 9, during 2021 the Group signed an agreement to reduce debt through a conversion into equity amounting to €55.3 million. The liability conversion into equity process is comprised of the following:

● Codere España S.A. and SEJO for €28.1 million (€27.8 million correspond to the borrowings and €0.3 million correspond to the trade payables).

● CNEW and SEJO for €13.9 million (€9.3 million correspond to the borrowings and €4.6 million correspond to the trade payables).

● Codere Scommese S.r.l. and Codere Italy S.A.U. for €1.0 million correspond to the borrowings.

● Latam companies for €2,8 million correspond to the trade payables.

● Codere Online Management Services LTD and related parties of Codere Group for €4.8 million correspond to the trade payables.

The intercompany liability is subject to the "cash free debt free" clause of the Business Combination Agreement. Accordingly, upon the Business Combination consummation (see Note 1) any outstanding liability was forgiven by the counterparty (Codere Group) and hence was converted into equity.

*Managing Director Services Agreement*

Prior to January 1, 2022, Mr. Edree, who currently serves as the Chief Executive Officer of Parent, served as Parent's Managing Director and provided services to Codere Online Business as an independent contractor pursuant to a services agreement entered into by Mr. Edree, Novelly Investments Limited, a British Virgin Islands company majority-owned by him ("Novelly"), and Codere Online Business's subsidiary, OMSE, with an effective date as of October 9, 2018 (as amended on November 30, 2020, the "Edree Services Agreement"). Under the Edree Services Agreement, Mr. Edree and Novelly agreed to provide, on an exclusive dedication basis (subject to their right to continue to manage certain identified holdings), certain services in exchange for a fixed annual fee payable by OMSE to Novelly of €250,000, plus a variable annual fee of up to €125,000, depending on the fulfilment of certain objectives each year. A success fee was also payable by OMSE calculated as 8% of the incremental value (as defined in the Edree Services Agreement) that is created at Codere Online, subject to a cap of €10 million, due to the services provided by Novelly. The success fee vested at a rate of 20% per year for two years (and 12% thereafter), being fully vested on the seventh anniversary of the effective date, or earlier upon the consummation of a company sale event (as defined therein). The Edree Services Agreement included a non-compete provision during the term of the agreement and for 18 months thereafter. Such provision excluded any services provided by Mr. Edree and Novelly to the companies set forth on a schedule to such agreement.

On December 31, 2021, the original parties to the Edree Services Agreement and Codere Newco agreed to amend and terminate the Edree Services Agreement ("Addendum No. 2"). Pursuant to Addendum No.2, Codere Newco agreed to become the sole obligor and assume any payment obligations and other obligations of OMSE with respect to the success fee vested up to December 31, 2021 payable to Novelly under the Edree Services Agreement. Addendum No. 2 was subject to the condition that the Parent Board ratified the signing of Addendum No. 2 and the Edree Executive Employment Agreement (as defined below) on or before March 31, 2022, which condition was satisfied on February 2, 2022.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Chief Executive Officer Employment Agreement*

Mr. Edree currently serves as the Chief Executive Officer of Parent pursuant to an executive employment agreement ("contrato laboral de alta dirección") entered into by Mr. Edree and SEJO, dated January 1, 2022 (the "Edree Executive Employment Agreement"), which the Parent Board ratified on February 2, 2022. Under the Edree Executive Employment Agreement, Mr. Edree accepted his employment as Codere Online's Chief Executive Officer and undertook to provide certain services under the supervision of the Parent Board and SEJO's board of directors, on an exclusive dedication basis (subject to Mr Edree's right to continue to manage certain identified entities under certain terms and conditions), for an indefinite term in exchange for a fixed annual salary payable by SEJO of €250,000, plus (i) a variable annual compensation of up to €125,000, depending on the fulfilment of certain objectives each year, (ii) the right to participate in the LTIP, (iii) an annual housing allowance in the amount of €25,000 and (iv) the right to indemnification under Codere Online's insurance for directors and senior managers from time to time. The Edree Executive Employment Agreement includes a non-compete provision during the term of the agreement and for 12 months thereafter (subject to Mr Edree's right to continue to manage certain identified entities under certain terms and conditions) and a non-solicit provision for 24 months after the term of the agreement. As consideration for the non-compete and non-solicit, Mr. Edree will be entitled to receive €250,000 upon termination of the agreement.

The members of the board of directors as of December 31, 2022 were as follows:

---

| | | |
|:---|:---|:---|
| **Name** | **Age** | **Title** |
| Patrick Joseph Ramsey | 49 | Director and Chairman of the Board |
| Moshe Edree | 56 | Director and Managing Director |
| Oscar Iglesias | 48 | Director and Chief Financial Officer |
| Borja Fernández | 49 | Director |
| Laurent Teitgen | 44 | Director |
| Dr. Martin M. Werner | 59 | Director |
| Daniel Valdez | 41 | Director |

---

The compensation to the members of the board of directors amounted to €187.8 thousand in 2022.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

15. RISK MANAGEMENT POLICIES

● **Key Group Risk** 

The key risks to which the Group is exposed are related to the gambling sector. The gambling industry is closely regulated (those regulations extend to the gambling business itself and the gambling formats and channels permitted; management of the risks associated with gambling; gambling advertising; data protection; anti-money laundering; and anti-fraud, among others). Gambling operators are required to fulfil a number of technical and compliance-related obligations in order to operate under licenses that need to be renewed at certain intervals and/or are subject to ongoing oversight. The failure to comply with any of these regulations or requirements or the inability to renew our gambling licenses could have an adverse impact on our business. In addition, new regulations in the future could imply additional restrictions on already-regulated activities that could reduce the Group's ability to offer products and services to its customers.

The industry is also exposed to the formulation of new and interpretation of existing gambling tax regulations in every market. Any increase in the gambling tax burden or changes in tax calculation methodologies could affect the viability of the Group's business. The gambling industry is often in the spotlight and the public perception of what the Group does can also have an adverse impact on its performance. Moreover, regulatory changes in the various markets could pave the way for the entry of new competitors or new gambling formats that could have an adverse impact on the Group's business. Lastly, the Group is and will remain exposed to inspections and/ lawsuits related with the above-mentioned tax regulations and compliance rules.

Elsewhere, the markets in which the Group does business expose it to political, macroeconomic and monetary risks that affect its international operations. The market conditions and social-economic variables in each of the Group's markets affect its customers' purchasing power and, by extension, its business performance. The Group is also affected by political and monetary risks (including exposure to currency devaluations and changes in company law in our operating markets).

The Group is exposed to risks deriving from its growth and financing strategies. Indeed, its indebtedness could curtail management of the business, whereas conditions in the capital markets or the undertaking of unprofitable investments could affect the Group's performance. Moreover, financial market circumstances and the Group's financial situation could affect the ability to secure the guarantees or sureties needed to operate most of the gambling licenses it manages in its various business markets.

In addition, the Group is exposed to the risk that its customers' tastes and preferences could change, as well as the risk that technology could lead to alternative leisure pursuits options. It also faces risks deriving from supplier or competitor concentration in certain formats or products and the ability or inability of the former to create safe gambling products that are attractive to customers and comply with prevailing legislation in one or more markets. Lastly, the impact of technology developments on how the business and product are managed (digitalization and interconnection) implies risks with respect to the integrity of the Group's IT systems and platforms which the Group needs to manage proactively in order to avoid potential contingencies. The Group's financial systems currently rely significantly on human intervention. The Group is making an effort to reduce the level of human intervention in the related processes.

The Group is exposed to various financial market risks as a result of its ordinary business activities. The main market risks affecting the Group are the following:

● **Liquidity risk**: The Group is exposed to liquidity risk if a mismatch arises between its financing needs (including operating and financial expense and investments) and its sources of financings (including revenues, divestments and credit lines from financial institutions and financial instruments from related parties (including capital contributions)).

● **Exchange rate risk:** The Group is exposed to exchange rate risk because its functional currency is the euro, and the value of financial assets denominated in a currency that is different from the Group's functional currency is subject to variations resulting from fluctuations in exchange rates.

● **Credit risk**: The Group is exposed to the possibility of a counterparty to an agreement not complying with its contractual obligations, thus negatively affecting results of operations of the Group.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

**Market Risk**

As a publicly traded company, the Group is exposed to market risks that arise from changes in market prices and rates, including foreign currency exchange rates, interest rates, equity prices, and other factors that affect the capital markets.

Additionally, our company has issued warrants that are also subject to market risk. Adverse changes in these market conditions could have a negative impact on our financial performance and position.

These market risks may impact the financial performance and position of the Company.

**Liquidity risk**

The Group's general financial policy consists in managing the liquidity to ensure that the funds required for future obligations are available through cash from operations and, at times, financings from related parties or third parties.

**Exchange rate risk**

Exchange rate risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Group's exposure to the risk of changes in foreign exchange rates relates primarily to the Group's operating activities (when revenue or expense is denominated in a foreign currency).

The Group actively manages exchange rate risks to control the exposure of balances to foreign currency in order to minimize the risks associated with exchange rate variations and optimizing the Group's financial cost. In this way, it attempts to protect its solvency and financial results.

The following tables include the outstanding current asset and current liability balances in foreign currencies as of December 31, 2022 and 2021 in thousands of euros:

**12/31/2022**

---

| | | |
|:---|:---|:---|
|  | **Current<br> assets** | **Current<br> liabilities** |
| ILS | 483 | 996 |
| COP | 5354 | 5529 |
| MXN | 4788 | 14164 |
| GBP | 14 |  |
| PAB | 922 | 1214 |
| ARS | 1368 | 1361 |
| USD | - | 57 |
| **Total** | **12929** | **23321** |

---

**12/31/2021**

---

| | | |
|:---|:---|:---|
|  | **Current<br> assets** | **Current<br> liabilities** |
| ILS | 150 | 829 |
| COP | 1337 | 2427 |
| MXN | 1734 | 6699 |
| GBP |  | 1 |
| ARS | 290 | 1444 |
| USD | 85763 | 158 |
| **Total** | **89274** | **11558** |

---

The balances exposed to the exchange rate risk from Panama were not significant.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

*Sensitivity analysis*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Thousands of euros** | **Thousands of euros** | **Sensitivity -10%** | **Sensitivity -10%** | **Sensitivity +10%** | **Sensitivity +10%** |
| **Currency** | **Exchange rate<br> 12/31/2022** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 5130.56 | 18 |  | (18) |  |
| MXN/EUR | 20.65 | 938 |  | (938) |  |
| GBP/EUR | 0.88 | 1 |  | (1) |  |
| USD/EUR | 1.07 | 4224 |  | (4224) |  |
| ARS/EUR | 188.96 | 273 |  | (273) |  |
| ILS/EUR | 3.75 | 51 |  | (51) |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Thousands of euros** | **Thousands of euros** | **Sensitivity -10%** | **Sensitivity -10%** | **Sensitivity +10%** | **Sensitivity +10%** |
| **Currency** | **Exchange rate<br> 12/31/2021** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 4509.0 | 109 |  | (109) |  |
| MXN/EUR | 23.0 | 496 |  | (496) |  |
| GBP/EUR | 0.8 |  |  |  |  |
| USD/EUR | 1.1 | 8592 |  | (8592) |  |
| ARS/EUR | 116.0 | 173 |  | (173) |  |
| ILS/EUR | 4.0 | 55 |  | (55) |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Thousands of euros** | **Thousands of euros** | **Sensitivity -10%** | **Sensitivity -10%** | **Sensitivity +10%** | **Sensitivity +10%** |
| &nbsp;&nbsp;&nbsp;**Currency** | **Exchange rate<br> 12/31/2020** | **Income<br> statement** | **Equity** | **Income<br> statement** | **Equity** |
| COP/EUR | 4212.0 | (44) |  | 44 |  |
| MXN/EUR | 24.5 | (212) |  | 212 |  |
| ILS/EUR | 3.9 | (6) |  | 6 |  |

---

**Credit risk**

The Group's main financial assets exposed to credit risk are trade receivables, current financial assets and other current assets.

Impairment provisions are determined on the basis of lifetime expected credit losses, including those expected at the individual level, using reasonable and supportable forward-looking information, based on the best information available at the date of authorizing the financial statements for issue. They are re-estimated at every reporting date on an individual basis, using the following criteria:

- The age of the debt.

- The existence of financial difficulties, including bankruptcy proceedings.

- An analysis of the debtor's ability to repay the loan.

As described in Note 3, the Group's historical credit loss experience between Group's entities is nil. The expected credit loss is estimated based on external risk parameters, publicly available, such as the probability of default ("PD") of Codere Group and a loss given at default ("LGD") of 100%.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

16. COMMITMENTS AND CONTINGENCIES

The Group is faced with certain contingencies, from time to time, involving litigation, claims, assessments or compliance. Such proceedings can be costly, time consuming and unpredictable and, therefore, no assurance can be given that the final outcome of such proceedings will not materially impact the Group's financial condition or results of operations. Estimated losses are accrued for these proceedings when the loss is probable and can be estimated. While the Group maintains insurance coverage that the Group believes is adequate to mitigate the risks of such proceedings, no assurance can be given that the amount or scope of existing insurance coverage will be sufficient to cover losses arising from such matters. The current liability for the estimated losses associated with these proceedings is not material to the consolidated financial condition and those estimated losses are not expected to have a material impact on the Group's results of operations.

**Masampe Allegations**

As first reported in the Codere Group's Earnings Results presentation filed by the Company with the SEC on November 12, 2021, the Group was made aware that Masampe S.L., José Antonio Martínez Sampedro, Luis Javier Martínez Sampedro and Encarnación Martínez Sampedro filed a criminal complaint with the Audiencia Nacional (a Spanish federal court) in July 2021 (as amended in September 2021), which was dismissed by the court due to a lack of jurisdiction. The plaintiffs appealed the decision in November 2021, which appeal was subsequently dismissed by the court. On December 21, 2021, the plaintiffs filed a second appeal against the court's decision to dismiss the appeal, which second appeal was dismissed by the court on February 3, 2022.

Based on the information currently available to the Group, the Group understands that the complaint: (i) makes allegations against certain directors, managers and shareholders of Codere Group, and certain of their respective affiliates and related parties for embezzlement and scheming to alter the price of things, including shares of Codere Group, breach of information rights, passing abusive resolutions, insolvency offences and unfair administration, and (ii) was amended in September 2021 to extend certain allegations of money laundering, payments to and from tax havens, breach of data protection rules and disclosure of secrets in relation to Codere Group's online business (which may refer to the Group), and certain irregularities in the hiring process of certain of its executives, against Novelly (as defined in Note 14), Moshe Edree, M&G Plc and several other related entities.

**Business e-Mail Compromise Incident**

Codere Online was the victim of cyber-related fraud activity which involved electronic communications impersonating one of Codere Online's vendors. After hacking the e-mail account of one of Codere Online's senior officers, the perpetrators sent illegitimate requests for payments attaching doctored invoices reflecting fraudulent account information for otherwise legitimate payment requests. As a result, during 2022, Codere Online made certain payments on outstanding invoices totalling approximately €744 thousand to foreign accounts controlled by the impersonator rather than to the account of the real vendor (the "Business e-Mail Compromise").

Codere Online launched an internal investigation to determine the full extent of the fraud scheme and related potential exposure in connection with the Business e-Mail Compromise, and has recorded a one-time pre-tax charge of €744 thousand in 2022 as the result of this event. Following the discovery of the Business e-Mail Compromise, Codere Online promptly initiated contact with the banks involved in the wire transfers as well as appropriate law enforcement authorities. To date, Codere Online has recovered a de minimis portion of the amounts transferred to illegitimate recipients in connection with the Business e-Mail Compromise. Codere Online is continuing to pursue the recovery of the amounts transferred. Codere Online may be limited in what information it can disclose as it is currently considering legal action and other remedies available in connection with the Business e-Mail Compromise. The ultimate amount of the loss will depend on Codere Online's success in recovering some or all of the funds. Codere Online currently believes the Business e-Mail Compromise is an isolated event and, to its knowledge, it did not compromise users' account deposits or login credentials and did not result in any unauthorized access to any of the confidential consumer information or other user data that Codere Online maintains. To date, Codere Online has not found any evidence of additional fraudulent activity. While this matter will result in some additional near-term expenses, Codere Online does not expect the Business e-Mail Compromise incident to have a material impact on its business.

Codere Online, led by the Internal Audit team of Codere Group, has conducted an investigation into the Business e-Mail Compromise. The investigation concluded on June 27, 2022 with a report to the audit committee of the Parent Board. The investigation has uncovered that the information contained in the e-mail account of the Codere Online senior officer was accessible to, and may have been accessed by, the perpetrators. Except for the information contained in such e-mail account, there is no evidence that Codere Online's systems were penetrated or that any corporate information, including our financial and accounting information, was accessed. The investigation has found no evidence of employee criminal involvement in the Business e-Mail Compromise. In connection with this investigation, Parent's senior management has concluded that Codere Online did not maintain effective disclosure controls and procedures because of the existence of certain material weaknesses in internal control over financial reporting. Codere Online has implemented enhanced internal controls over financial reporting and is in the process of implementing additional procedures and controls pursuant to recommendations from the investigation.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

17. OTHER INFORMATION

**Italian subsidiary liquidation**

Codere Online sold Codere Scommese S.r.l. and ceased its operations in Italy on December 30, 2022, after evaluating a number of strategic alternatives with respect to its Italian business.

**Management Incentive Plan**

On February 2, 2022, the Parent Board approved the terms and conditions of a long-term incentive plan (the "LTIP"), which was approved by the Parent Shareholders at a meeting held on March 3, 2022. The main objective of the LTIP is to enhance the alignment between senior management and director interests with those of Codere Online and Parent Shareholders and to strengthen the retention and motivation of senior management and directors in the long term.

The LTIP is primarily for the benefit of certain existing and future senior managers of Parent and the Remunerated Directors and certain employees and independent contractors providing services to Codere Online from time to time. The beneficiaries will be proposed by the Chief Executive Officer of Parent and will be subject to approval by the Parent Board. Upon approval by the Parent Board, such beneficiaries will receive an invitation letter to participate in the LTIP. Beneficiaries will be required to accept the terms of a post-contractual non-compete and non-solicitation agreement to benefit from the terms of the LTIP.

Compensation under the LTIP will be based on the beneficiary's expected role, responsibilities and contribution to the business of Parent, among other things. The LTIP includes compensation in the form of share options, restricted shares, and/or deferred payments payable depending upon the increase in Parent's equity value. And/or deferred payments payable depending upon the Incremental Equity Value (the amount will be determined as soon as possible following year-end 2026). The Incremental Equity Value will be calculated considering the Exercise Equity Value (which will be calculated considering the 2026 Adjusted EBITDA, the Net Financial Debt and the Transaction Value of Codere Online as established in the Company Sale Event), the Base Equity Value (amounted to $350 million) and the Invested Capital from shareholders (cash contributions to shareholders, in each case to the extent made after the Date of Commencement of these Plan and will be capitalized at an annual rate of 8%).

According to the LTIP Agreement, the termination date of the restricted shares and deferred payments will be March 31, 2027, whereas the share options will terminate on December 31, 2027. The number of share options to be granted will be based on the portion of the Target Compensation tied to this stock option component, a $10,00 exercise price (the "Strike Price"), the Target Share Price and subject to standard anti-dilution protections and adjustment for extraordinary cash dividends.

The share options granted to the Beneficiaries shall have a 20% vesting per calendar year, considering the applicable start of vesting period. The share options will be exercisable at the option of the beneficiary on a cash or cashless basis (subject to Parent's option to net cash settle to avoid the dilutive impact from any such share option exercise) and will not be transferable by the beneficiary at any time.

The number of restricted shares to be granted will be based on the portion of the Target Compensation tied to the restricted share component and a target share price of $20.50 ("Target Share Price"). The restricted shares may also be net cash settled by Parent to avoid the dilutive impact from the issuance of restricted shares. Share options may be exercised, and restricted shares may be sold, following the later of (i) 90 days from the respective vesting date and (ii) December 31, 2023.

The deferred payments right are also part of the LTIP to enhancing the alignment between senior management and directors' interest with those of Codere Online and Holdco Shareholders and to strength the retention and motivation of senior management and directors in the long term. Deferred payments are measured in USD and employee will receive as many shares as are worth to the deferred payments right amount on December 31, 2026. The deferred payments right granted to the Beneficiaries shall have a 20% vesting per calendar year and will be paid at Parent's option in cash or Ordinary Shares subject to certain exceptions and acceleration events.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

The company formally issuing the shares will be the Parent. However, the Employer Company of each Beneficiary will be the one liable for compliance with applicable payroll obligations (income tax withholdings and social security tax withholdings/payments).

The total number of Ordinary Shares issuable to beneficiaries pursuant to the share options and restricted shares shall be limited to 5% of the total number of Ordinary Shares issued and outstanding at the time the LTIP was approved by the Parent Shareholders. Such limit will be increased by an amount equivalent to 0.2% of the total number of Ordinary Shares issued and outstanding on each December 31 through the end of the vesting period of the LTIP, to provide for additional capacity to grant awards to additional beneficiaries under the LTIP.

The total number of share options, restricted shares and deferred payments right to each part of the LTIP is as follow:

---

| | | | |
|:---|:---|:---|:---|
|  | **Share<br> options** | **Restricted<br> Shares** | **Deferred<br> payments<br> right** |
| Total Rights assigned to the beneficiaries | 900148 | 897970 | - |
| Fair value of the LTIP in USD | 1058967 | 3632610 | 4131152 |
| Weighted average price in USD | 1.18 | 4.05 | - |
| Options granted during the period | 180030 | 179594 | 37918 |
| Options exercised during the period | - | - | - |
| Options outstanding as of December 31, 2022 | 180030 | 179594 | 37918 |
| Exercisable as of December 31, 2022 | - | - | - |

---

The fair value of the equity instruments granted has been determined using a Monte Carlo simulation valuation model as of each of the Grant dates, considering the conditions determined in the LTIP Agreement, and the following assumptions:

---

| | |
|:---|:---|
| Forecast share price volatility (annualized) | 50.13% |
| Plan duration (years) | 5.00 |
| Expected dividend yield | 0.00% |
| Risk-free interest rate | U.S. Sovereign Bond yield |

---

Regarding the forecasted share price volatility, given the recent listing of the Company's shares, the annualized share price volatility has been calculated as the average historical standard deviation among the company's selected peers, considering a 5-year period, matching the LTIP tenor.

More specifically, the restricted share's fair value has been calculated as the number of estimated vested instruments times the expected share value at the assumed restricted shares exercise date. The number of estimated vested instruments used has been the one established in each beneficiary's invitation letter, and the expected share value has been determined according to the aforementioned Monte Carlo simulation and the valuation inputs previously detailed.

Regarding the fair value of the stock options which may be converted into the Company's ordinary equity at a previously specified price for a determined time period, has been obtained in a similar way, by multiplying the number of vested stock options times the expected option value as of that date. In this sense, in order to determine the stock option value as of each of the grant dates, we have also used the expected share price evolution as determined by the Monte Carlo simulation model. Additionally, it is worth mentioning that options' value can be divided into intrinsic value, consisting in the difference between the underlying share's price and the option's strike if this is a positive value for the acquirer of the option shares; and time value, which represents the possibility that the option may obtain intrinsic value in the future. In this sense, according to the valuation model's share price expected evolution, the Company's stock options only have time value as of each of the grant dates, due to the value of the underlying ordinary shares as of the grant dates and the strike price of $10 per share.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

Finally, it must be noted that the fair value of deferred payments to be made in a future date, depends directly on a non-market condition (evolution of the Company's EBITDA during the Sub-Plan's life). However, it is possible to determine the number of shares to be delivered, based on the expected evolution of the Company's EBITDA in line with its business plan, which will be revised subsequently until the payment date. To this extent, in order to establish the preliminary number of shares which will be delivered to the Sub-Plans' beneficiaries, the main input used has been the Company's business plan.

The incentives granted to the beneficiaries under the LTIP will be subject to a 5-year general vesting period, with 20% vesting per year, subject to certain exceptions and acceleration events, in order to promote the long-term retention of the beneficiaries.

Except in the case of a termination for gross misconduct, fraud or gross negligence, in which case the relevant beneficiary would forfeit all rights to both vested and unvested compensation under the LTIP, beneficiaries that cease to be employed by Codere Online or to provide services to Codere Online, as applicable, will retain all vested compensation up to the date of any such resignation or termination. Awards are subject to recovery by Codere Online under certain events, including as a result of a breach of the post-contractual non-compete or non-solicit or pursuant to applicable laws and regulations. Except as prohibited by applicable laws, the company may extend loans to beneficiaries to pay certain taxes due in connection with compensation under the LTIP.

The LTIP is subject to the Spanish employment law as a significant part of the compensation under the LTIP will be awarded to beneficiaries located in Spain. The components of the LTIP may be subject to special terms and conditions depending on the location of the beneficiary.

The foregoing description of the LTIP does not purport to be complete and is qualified in its entirety by reference to the full text of the LTIP Master Agreement, which has been filed as an exhibit to the annual report of the Group as of December 31, 2021. As of December 31, 2022, the impact of the LTIP was recorded in the Consolidated Carve-out Financial Statements of Income (Loss) as personnel expenses amounted to 3,567 thousand dollars.

[**Table of Contents**](#toc)

**CODERE ONLINE LUXEMBOURG, S.A.**

**(formerly denominated CODERE ONLINE BUSINESS) AND SUBSIDIARIES**

**NOTES TO THE CONSOLIDATED CARVE-OUT**

**FINANCIAL STATEMENTS FOR THE PERIODS ENDED DECEMBER 31, 2022 AND**

**2021 AND FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020**

**(Thousands of Euros)**

18. EVENTS AFTER THE REPORTING DATE

*Liquidation of Subsidiary*

On October 20, 2022, the board of directors of Codere Online Luxembourg, S.A. approved the liquidation of its Malta operating entity named Codere Online Operator LTD, of its Malta supporting entity named Codere Online Management Services LTD and of its Gibraltar supporting entity named Codere (Gibraltar) Marketing Services LTD. The liquidation is expected to be completed on or before December 31, 2023, subject to customary closing conditions. Codere Online voluntarily surrendered its B2C license on February 28, 2023 as it does not currently offer online casino and sports betting to customers located in Malta. On March 3, 2023, Codere Online voluntarily surrendered its B2B license, which authorized the provision of B2B gaming services

The liquidation represents a significant event for Codere Online Luxembourg, S.A. This liquidation is not expected to have any significant financial impact in the financial statements for the period in which the liquidation occurs.

*Board composition changes*

On March 1, 2023, Moshe Edree was replaced by Aviv Sher as a Chief Executive Officer of Codere Online Luxembourg, S.A.

*2023 Proposed Restructuring*

On March 29, 2023, the Codere Group announced a new financial restructuring process (the "2023 Proposed Restructuring"). As part of the 2023 Proposed Restructuring, the Codere Group has entered into a lock-up agreement with a group of its bondholders which provides for a standstill period that is designed to enable the Codere Group to implement a further restructuring of its liabilities. As reported by the Codere Group on April 19, 2023, the Codere Group obtained shareholder approval and received significant positive engagement from noteholders in connection with the 2023 Proposed Restructuring. The Codere Group is in the process of preparing the relevant documentation for the purposes of implementing the 2023 Proposed Restructuring by no later than the end of the second quarter of 2023. The structure of the restructuring is expected to include the provision of €100 million in new money and the amendment of certain maturities, coupon amounts and composition, seniority and other terms of the Codere Group's existing liabilities.

There were no additional events subsequent to the closing date which could have a significant effect on the Group's audited consolidated carve-out financial statements.

## Exhibit 2.1

**Exhibit 2.1**

**DESCRIPTION OF THE REGISTRANT'S SECURITIES REGISTERED PURSUANT TO SECTION 12<br> OF<br> THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED**

*As of December 31, 2024, Codere Online Luxembourg, S.A. ("Codere Online") had two class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended: Ordinary Shares and Codere Online Warrants.*

*We urge you to read the applicable provisions of Luxembourg law and Codere Online's articles of association carefully and in their entirety because they describe your rights as a holder of Ordinary Shares and/or Codere Online Warrants. A copy of Codere Online's articles of association have been filed with the U.S. Securities and Exchange Commission ("SEC") and are listed as an exhibit to Codere Online's annual report on Form 20-F for the year ended December 31, 2024 (the "Annual Report"). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Annual Report.*

**Ordinary Shares**

***Share Capital***

Codere Online was incorporated on June 4, 2021 by Codere Newco, with an initial share capital of €30,000, represented by 30,000 Ordinary Shares with a nominal value of €1 per share (the "Incorporation"). As of December 31, 2024, Codere Online's share capital amounted to €45,491,175, represented by 45,491,175 Ordinary Shares, with a nominal value of €1.00 per share. All issued shares are fully paid and subscribed for. The authorized capital of Codere Online amounts to €499,481,142 divided into 499,481,142 Ordinary Shares with a nominal value of €1.00 each.

A shareholder in a Luxembourg *société anonyme*, such as Codere Online, holding fully paid up shares is not liable, solely because of his, her or its shareholder status, for additional payments to such *société anonyme* or its creditors.

***Share Issuances***

Pursuant to Luxembourg law, the issuance of Ordinary Shares requires approval by the general meeting of shareholders subject to necessary quorum and majority requirements. The general meeting of shareholders has also approved an authorized capital and authorized Codere Online Board to (i) carry out any increase of the share capital or equity of Codere Online with or without the issuance of new Ordinary Shares, (ii) issue convertible bonds, convertible preferred equity certificates, warrants, options or other convertible instruments, exchangeable or exercisable into new Ordinary Shares ("Convertible Instruments"), and (iii) issue new Ordinary Shares further to the conversion or exercise of the Convertible Instruments up to the limit of the authorized capital. The Codere Online Board is authorized to remove or limit the statutory preferential subscription right of the shareholders in case of issue against payment in cash of Ordinary Shares and Convertible Instruments up to the maximum amount of such authorized capital, for a maximum period of five years after the date of the publication of the notarial deed enacting the Incorporation in the Luxembourg official gazette (*Recueil Electronique des Sociétés et Associations*, "RESA"). The general meeting may amend, renew, or extend such authorized capital and such authorization to the Codere Online Board to issue shares.

In addition, the general meeting of shareholders has authorized Codere Online Board to make an allotment of existing or newly issued shares without consideration to (i) employees of Codere Online or certain categories amongst those; (ii) employees of companies or economic interest grouping in which Codere Online holds directly or indirectly at least fifty per cent (50%) of the share capital or voting rights; (iii) employees of companies or economic interest grouping in which at least fifty per cent (50%) of the share capital or voting rights is held directly or indirectly by a company which holds directly or indirectly at least fifty per cent (50%) of the share capital of Codere Online; (iv) members of the corporate bodies of Codere Online or of the companies or economic interest grouping listed in point (ii) to (iii) above or certain categories amongst those, for a maximum period of five years after the date of the publication of the notarial deed enacting the Incorporation in the RESA.

An Ordinary Share may be registered in the name of more than one person provided that all holders of such Ordinary Share notify Codere Online in writing as to which of them is to be regarded as their representative. Codere Online will deal with that representative as if it were the sole shareholder in respect of that Ordinary Share including for the purposes of voting, dividend and other payment rights. The Codere Online Board may suspend the exercise of voting rights of any holder of an Ordinary Share who has not complied with his duties and obligations set out in the articles of association of Codere Online, any shareholders agreement or in the relevant subscription agreement or commitment, that may be entered from time to time.

The Codere Online Board will resolve on any future issuance of Ordinary Shares out of the authorized capital (*capital autorisé*) in accordance with the quorum and voting thresholds set forth in the articles of association of Codere Online and applicable law. In any such instance, the Codere Online Board will also resolve on the applicable procedures and timelines to which such issuance will be subjected. If the proposal of the Codere Online Board to issue new Ordinary Shares exceeds the limits of Codere Online's authorized share capital, the Codere Online Board must then convene the shareholders to an extraordinary general meeting to be held in front of a Luxembourg notary for the purpose of increasing the issued share capital. Such meeting will be subject to the quorum and majority requirements required for amending the articles of association. If the capital call proposed by the Codere Online Board consists of an increase in the shareholders' commitments, the Codere Online Board must convene the shareholders to an extraordinary general meeting to be held in front of a Luxembourg notary for such purpose. Such meeting will be subject to the unanimous consent of the Codere Online Shareholders.

***Preemptive Rights***

Under Luxembourg law, existing Codere Online Shareholders benefit from a preemptive subscription right on the issuance of Ordinary Shares for cash consideration. However, Codere Online Shareholders have, in accordance with Luxembourg law, authorized the Codere Online Board, for a period not exceeding five years, to suppress, waive, or limit any preemptive subscription rights of shareholders provided by law to the extent that the Codere Online Board deems such suppression, waiver, or limitation advisable for any issuance or issuances of Ordinary Shares within the scope of Codere Online's authorized share capital. The general meeting of shareholders duly convened to consider an amendment to the articles of association also may, by two-thirds majority vote, limit, waive, or cancel such preemptive rights. Such Ordinary Shares may be issued above, at, or below market value, and, following a certain procedure, even below the nominal value or below the accounting par value per ordinary share. The Ordinary Shares also may be issued by way of incorporation of available reserves, including share premium.

***Share Repurchases***

Codere Online cannot subscribe for its own Ordinary Shares. Codere Online may, however, repurchase issued Ordinary Shares or have another person repurchase issued Ordinary Shares for its account, subject to the following conditions:

● prior authorization by a simple majority vote at an ordinary general meeting of shareholders, which authorization sets forth:

● the terms and conditions of the proposed repurchase and in particular the maximum number of Ordinary Shares to be repurchased;

● the duration of the period for which the authorization is given, which may not exceed five years; and

● in the case of repurchase for consideration, the minimum and maximum consideration per share, provided that the prior authorization shall not apply in the case of Ordinary Shares acquired by either Codere Online, or by a person acting in his or her own name on its behalf, for the distribution thereof to its staff or to the staff of a company with which it is in a control relationship;

● the repurchases, including Ordinary Shares previously acquired by Codere Online and held by it and Ordinary Shares acquired by a person acting in his or her own name but on Codere Online's behalf, may not have the effect of reducing the net assets below the amount of the issued share capital plus the reserves (which may not be distributed by law or under the articles of association);

● only fully paid-up Ordinary Shares may be repurchased;

● the voting and dividend rights attached to the repurchased Ordinary Shares will be suspended as long as the repurchased shares are held by Codere Online; and

● the acquisition offer must be made on the same terms and conditions to all the shareholders who are in the same position, except for acquisitions which were unanimously decided by a general meeting at which all the shareholders were present or represented. In addition, under Luxembourg law, listed companies may repurchase their own shares on the stock exchange without an acquisition offer having to be made to their shareholders.

The authorization for the repurchase will be valid for a period ending on the earlier of five years from the date of such shareholder authorization and the date of its renewal by a subsequent general meeting of shareholders. Pursuant to such authorization, Codere Online Board is authorized to acquire and sell Ordinary Shares under the conditions set forth in article 430-15 of the 1915 Law. Such purchases and sales may be carried out for any authorized purpose or any purpose that is authorized by the laws and regulations in force.

In addition, pursuant to Luxembourg law, Codere Online may directly or indirectly repurchase Ordinary Shares by resolution of the Codere Online Board without the prior approval of the general meeting of shareholders if such repurchase is deemed by the Codere Online Board to be necessary to prevent serious and imminent harm to Codere Online, or if the acquisition of Ordinary Shares has been made with the intent of distribution to its employees and/or the employees of any entity having a controlling relationship with it (*i.e.*, its subsidiaries or controlling shareholder, Codere Newco) or in any of the circumstances listed in article 430-16 of the 1915 Law.

***Voting Rights***

Each Ordinary Share entitles the holder thereof to one vote. Neither Luxembourg law nor Codere Online's articles of association contain any restrictions as to the voting of Ordinary Shares by non-Luxembourg residents. The Codere Online Board may suspend the exercise of voting rights of any shareholder who has not complied with his or her duties and obligations set out in the articles of association, any shareholders agreement or in the relevant subscription agreement or commitment. The 1915 Law distinguishes general meetings of shareholders and extraordinary general meetings of shareholders with respect to voting rights.

***Nomination of Directors***

Pursuant to the Nomination Agreement, during the Sponsor Proposal Period, the Codere Online Board will consist of seven (7) directors and (i) Codere Newco will have the right to propose for appointment four (4) Codere Newco Directors; (ii) the Sponsor will have the right to propose for appointment two (2) Sponsor Directors; and (iii) Codere Newco and the Sponsor will have the right to jointly propose for appointment the Industry Expert Independent Director. After the Sponsor Proposal Period, Codere Newco will have the right to propose for appointment five (5) directors, with at least two (2) of them having to qualify as independent directors (subject to independence requirements under applicable securities exchange rules that may require a greater number of independent directors). Both during and after the Sponsor Proposal Period, at least one (1) of the Codere Newco Directors shall qualify as a Luxembourg tax resident.

Codere Newco will have the right to propose for reappointment the Codere Newco Directors and the Sponsor will have the right to propose for reappointment the Sponsor Directors appointed within the Sponsor Proposal Period; provided that one (1) Sponsor Director shall not have the right to serve as director past the second annual shareholders' meeting of Codere Online after the Closing Date and the second Sponsor Director shall not have the right to serve as director past the third annual shareholders' meeting of Codere Online after the Closing Date.

Pursuant to the Nomination Agreement, the Codere Online audit committee shall include at least one (1) Codere Newco Director and one (1) Sponsor Director (in either case only to the extent such director (i) qualifies as an independent director and (ii) meets the heightened independence requirements applicable to audit committees under the SEC rules and regulations and under the criteria established by the Nasdaq). Further, Codere Newco will have the right, but not the obligation, to propose for appointment one (1) non-executive, non-independent director as an observer to the audit committee to be appointed by the Codere Online Board, subject to compliance with Rule 10A-3 under the Exchange Act.

The initial term of office of each director will be for a maximum period of one (1) year until the annual general meeting of the shareholders of Codere Online, in each case beginning on the day immediately following the date of his/her appointment.

In accordance with Codere Online's articles of association, the Codere Online Board is not divided into classes of directors, but the Codere Online Shareholders may decide to appoint directors of two different classes, namely the class A directors and the class B directors.

***Meetings***

*Ordinary General Meeting*

According to the provisions of the 1915 Law, at an ordinary general meeting, there is no quorum requirement and resolutions are adopted by a simple majority of validly cast votes.

Abstentions, blank or invalid votes are not considered as "votes."

However, pursuant to Codere Online's articles of association, and except where lower thresholds are mandatorily required by Luxembourg law, resolutions at an ordinary general meeting are only valid if they are passed by a majority of the votes cast, provided that at least 33 1/3% of the Ordinary Shares are present or represented.

*Extraordinary General Meeting*

Extraordinary resolutions are required for any of the following matters, among others: (i) an increase or decrease of the authorized or issued capital; (ii) a limitation or exclusion of preemptive rights; (iii) approval of a statutory merger or de-merger (scission); (iv) Codere Online's dissolution and liquidation; (v) any and all amendments to Codere Online's articles of association; and (vi) change of nationality. Pursuant to Codere Online's articles of association, for any resolutions to be considered at an extraordinary general meeting of shareholders, (i) the quorum shall be at least one half of Codere Online's issued share capital, and (ii) the agenda shall indicate the proposed amendments to the articles of association and, where applicable, the text of those which concern the objects or the form of Codere Online. If the said quorum is not present, a second meeting may be convened, in the manner prescribed by the articles of association and by the 1915 Law, at which no quorum shall be required. Any extraordinary resolution shall be adopted at a quorate general meeting by at least a two-thirds majority of the votes validly cast on such resolution by shareholders. Abstentions, blank or invalid votes are not considered as "votes."

*Annual Shareholders Meetings*

An annual general meeting of shareholders shall be held in the Grand Duchy of Luxembourg within six months of the end of the preceding financial year, except for the first annual general meeting of shareholders which may be held within 18 months from incorporation.

***Lock-up Agreements***

In connection with the Business Combination, DD3, Codere Newco, Codere Online, the Sponsor, the Forward Purchasers and the other parties thereto, entered into the Registration Rights and Lock-Up Agreement. Pursuant to the Registration Rights and Lock-Up Agreement, each of Codere Newco and the Sponsor agreed to not transfer any Lock-Up Securities (as defined in the Registration Rights and Lock-Up Agreement) until the earliest of: (i) the date that is one year from the Closing, (ii) the date on which the closing price of the Ordinary Shares on Nasdaq equals or exceeds $12.50 per Ordinary Share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing 150 days after the Closing or (iii) such date on which Codere Online completes a liquidation, merger, share exchange or other similar transaction that results in all Codere Online shareholders having the right to exchange their Ordinary Shares for cash, securities or other property, subject to certain exceptions described in Section 5.2 of the Registration Rights and Lock-Up Agreement. Further, pursuant to the Registration Rights and Lock-Up Agreement, the parties agreed that no registration shall be effected with respect to Lock-Up Securities held by Codere Newco or the Sponsor, until after the expiration of the lock-up period. As of the date of the Annual Report, the lock-up restrictions under the Registration Rights and Lock-Up Agreement have expired.

Pursuant to the Subscription Agreements, each Subscriber acknowledged and agreed that, without the prior written consent of DD3 and Codere Online, during the period commencing on the Closing Date and continuing until the earlier of the ninety (90) calendar day period commencing on the date of the closing of the Business Combination and the date when the Registration Statement is declared effective by the SEC, such Subscriber, and any person or entity acting on its behalf or pursuant to any understanding with it, would not (i) sell, assign, transfer (including by operation of law), incur any liens, charges, security interests, options, claims, mortgages, pledges, proxies, voting trusts or agreements, obligations, understandings or arrangements or other restrictions on title or transfer of any nature whatsoever, dispose of or otherwise encumber, (ii) make any short sale of, grant any option for the purchase of, or (iii) enter into any hedging or similar transaction with the same economic effect as a transfer in sub-section (i) above of, any of the PIPE Shares.

***Registration Rights***

In connection with the Business Combination, DD3, Codere Newco, Codere Online, the Sponsor, the Forward Purchasers and the other parties thereto, entered into the Registration Rights and Lock-Up Agreement, which provided customary demand and piggyback registration rights. Pursuant to the Registration Rights and Lock-Up Agreement, Codere Online agreed that, within 30 calendar days after the Closing Date, it would file with the SEC a registration statement to permit the public resale of certain Ordinary Shares and Codere Online Warrants (including underlying securities) held by the Holders (as defined in the Registration Rights and Lock-Up Agreement), and that it would use its reasonable best efforts to have the registration statement declared effective as soon as practicable after the filing thereof, but no later than 60 calendar days following the filing deadline, provided that the effectiveness deadline will be extended to 90 calendar days after the filing deadline if the registration statement is reviewed by, and receives comments from, the SEC. Subject to certain terms and conditions, Codere Online may delay the filing or initial effectiveness of, or suspend use of, such registration statement for the shortest period of time, but in no event for a period more than sixty (60) consecutive days or more than two times in any calendar year. In addition, pursuant to the terms of the Registration Rights and Lock-Up Agreement and subject to certain requirements and customary conditions, including with regard to the number of demand rights that may be exercised, certain holders may demand at any time or from time to time, that Codere Online file a registration statement on Form F-1, or any such other form of registration statement as is then available to effect a registration, or, if available, Form F-3, to register the securities of Codere Online held by such holders. The Registration Rights and Lock-Up Agreement also provide the Holders with "piggy-back" registration rights, subject to certain requirements and customary conditions. Further, pursuant to the Registration Rights and Lock-Up Agreement, the parties agreed that no registration shall be effected with respect to Lock-Up Securities held by Codere Newco or the Sponsor, until after the expiration of the lock-up period.

Pursuant to the Subscription Agreements, Codere Online agreed that, within 30 calendar days after the Closing, Codere Online would file with the SEC the Registration Statement (as defined in the Subscription Agreements), and Codere Online would use its commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof; provided, however, that Codere Online's obligations to include the Ordinary Shares held by a Subscriber in the Registration Statement would be contingent upon the respective Subscriber furnishing in writing to Codere Online such information regarding the Subscriber, such Ordinary Shares held by such Subscriber and the intended method of disposition of such shares as shall be reasonably requested by Codere Online to effect the registration, and will execute such documents in connection with such registration as Codere Online may reasonably request that are customary of a selling stockholder in similar situations. Notwithstanding anything to the contrary in the Subscription Agreements, Codere Online may, upon giving prompt written notice of such action to the respective Subscriber, delay the filing or initial effectiveness of, suspend use of, the Registration Statement for a period of not more than sixty (60) consecutive days or more than two times in any calendar year if the filing, initial effectiveness or continued use of the Registration Statement would, in the good faith judgment of the Codere Online Board, make Codere Online fail to comply with applicable disclosure requirements or would require the inclusion in such Registration Statement of (i) financial statements that are unavailable to Codere Online for reasons beyond Codere Online's control, (ii) audited financial statements as of a date other than Codere Online's fiscal year end, or (iii) pro forma financial statements that are required to be included in a registration statement. Codere Online has made use of such right under the Subscription Agreements and notified the relevant Subscribers and certain other holders of Codere Online securities.

**Codere Online Warrants** 

Pursuant to the Warrant Amendment Agreement, DD3 assigned to Codere Online all of DD3's right, title and interest in and to the Original Warrant Agreement and Codere Online assumed, and agree to pay, perform, satisfy and discharge in full, all of DD3's liabilities and obligations under the Original Warrant Agreement arising from and after the Merger Effective Time. In connection with the consummation of the Business Combination, all DD3 Warrants were converted into Codere Online Warrants.

As of December 31, 2024, there were 6,435,000 Codere Online Warrants issued and outstanding, consisting of 6,250,000 Codere Online Public Warrants and 185,000 Codere Online Private Warrants. Each Codere Online Warrant will be exercisable to purchase one Ordinary Share and only whole warrants are exercisable. The exercise price of the Codere Online Warrants will be $11.50 per share, subject to adjustment as described in the Warrant Agreement. A Codere Online Warrant may be exercised only during the period commencing on December 30, 2021 (i.e., 30 days after the completion of the Business Combination), and terminating at 5:00 p.m., New York City time on the earlier to occur of: (i) the date that is five (5) years after the Closing Date, (ii) the liquidation of Codere Online, and (iii) the redemption date as provided in Section 6.2 of the Original Warrant Agreement.

Codere Online Private Warrants are identical to the Codere Online Public Warrants, except that the former may be exercisable on a cashless basis at the holder's option and will be non-redeemable so long as they are held by the initial purchasers of the Private Warrants or their permitted transferees. If such warrants are held by someone other than the initial purchasers of the Private Warrants or their permitted transferees, the related Codere Online Private Warrants will be redeemable and exercisable by such holders on the same basis as Codere Online Public Warrants.

***Redemptions of Codere Online Public Warrants***

Codere Online will have the ability to redeem Codere Online Public Warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of the Ordinary Shares equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within a 30 trading-day period commencing at any time after the Codere Online Public Warrants become exercisable and ending on the third business day prior to proper notice of such redemption provided that on the date Codere Online gives notice of redemption and during the entire period thereafter until the time Codere Online redeems the Codere Online Public Warrants, Codere Online has an effective registration statement under the Securities Act covering the Ordinary Shares issuable upon exercise of the Codere Online Public Warrants and a current prospectus relating to them is available. As of December 31, 2024, the trading price of the Ordinary Shares had not reached the $18.00 threshold. If and when the Codere Online Public Warrants become redeemable by Codere Online, Codere Online may exercise its redemption right even if Codere Online is unable to register or qualify the underlying securities for sale under all applicable state securities laws. In the event Codere Online determined to redeem the Codere Online Public Warrants, holders would be notified of such redemption as described in the Warrant Agreement. Specifically, Codere Online would be required to fix the Redemption Date (as defined in the Warrant Agreement). Notice of redemption would be mailed by first class mail, postage prepaid, by Codere Online not less than 30 days prior to the Redemption Date to the registered holders of the Codere Online Public Warrants to be redeemed at their last addresses as they appear on the registration books. In addition, beneficial owners of the redeemable warrants will be notified of such redemption via Codere Online's posting of the redemption notice to DTC. If the Codere Online Public Warrants are called for redemption for cash, management will have the option to require all holders that wish to exercise the warrants to do so on a "cashless basis," as described in the Warrant Agreement.

None of the Codere Online Private Warrants will be redeemable by Codere Online so long as they are held by the initial purchasers of the Private Warrants or their permitted transferees.

The foregoing description of the Codere Online Warrants is qualified in its entirety by reference to the full text of the Original Warrant Agreement and the Warrant Amendment Agreement, both of which are listed as exhibits to the Annual Report.

**Dividends**

From the annual net profits of Codere Online, at least 5% shall each year be allocated to the reserve required by applicable laws (the "Legal Reserve").

That allocation to the Legal Reserve will cease to be required as soon and as long as the Legal Reserve amounts to 10% of the amount of the share capital of Codere Online. The general meeting of shareholders shall resolve how the remainder of the annual net profits, after allocation to the Legal Reserve, will be disposed of by allocating the whole or part of the remainder to a reserve or to a provision, by carrying it forward to the next following financial year or by distributing it, together with carried forward profits, distributable reserves or share premium to the shareholders, each Ordinary Share entitling to the same proportion in such distributions.

The Codere Online Board may resolve that Codere Online pays out an interim dividend to the shareholders, subject to the conditions of article 461-3 of the 1915 Law and Codere Online's articles of association. The Codere Online Board shall set the amount and the date of payment of the interim dividend.

Any share premium, assimilated premium or other distributable reserve may be freely distributed to the shareholders subject to the provisions of the 1915 Law and Codere Online's articles of association. In case of a dividend payment, each shareholder is entitled to receive a dividend right pro rata according to his or her respective shareholding. The dividend entitlement lapses upon the expiration of a five-year prescription period from the date of the dividend distribution. The unclaimed dividends return to Codere Online's accounts.

## Exhibit 4.25

**Exhibit 4.25**

**WAIVER TO THE**

**RELATIONSHIP AND LICENSE** **AGREEMENT**

This WAIVER TO THE RELATIONSHIP AND LICENSE AGREEMENT (this "**Waiver**"), dated as of May 1, 2025 (the "**Waiver Effective Date**"), is entered by Codere Online Luxembourg, S.A. ("**Holdco**"), Servicios de Juego Online, S.A.U. (the "**Company**", together with Holdco, "**Codere Online**") and Codere Newco, S.A.U. ("**Parent**").

**RECITALS**

WHEREAS, the Company and Parent entered into a certain Relationship and License Agreement, dated as of June 21, 2021 (as amended, supplemented or otherwise modified prior to the Waiver Effective Date, the "**Agreement**");

WHEREAS, pursuant to Section 12.1 (*Amendment, Waiver*) of the Agreement, the provisions of the Agreement may be amended or waived with the signed, written agreement of Company and Parent;

WHEREAS, Holdco is the sole shareholder of Company and, pursuant to the procedural rules and corporate governance guidelines of Holdco's board of directors, Holdco's board of directors needs to approve any material amendments to the Agreement;

WHEREAS, Parent has requested that Holdco and the Company waive the prohibition included in Section 5.1 (*Other Activities*) of the Agreement restricting Parent from carrying out a Restricted Activity (including, for the avoidance of doubt, the license, sublicense, sale or transfer/granting of rights with respect to the Licensed Marks to any Person (other than the Company Group) operating the Online Gaming Business) within the Territory, exclusively with respect to Italy (the "**Italian Restriction**"); and

WHEREAS, the Company is willing to agree to the request to waive the Italian Restriction on the terms and subject to the conditions contained in this Waiver.

NOW THEREFORE, in consideration of the mutual covenants set forth in this Waiver, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agree as follows:

SECTION 1. <u>Capitalized Terms</u> Capitalized terms used and not otherwise defined herein shall for all purposes of this Waiver, including the preceding recitals, have the respective meanings specified therefor in the Agreement.

SECTION 2. <u>Waiver Pursuant to the Agreement</u>. On the Waiver Effective Date, the Company hereby waives pursuant to Section 12.1 (*Amendment, Waiver*) of the Agreement, and Holdco accepts the waiver of, the Italian Restriction. For the avoidance of doubt, the waiver contained herein is limited as written and no Restricted Activity other than the Italian Restriction shall be waived in accordance with this Section 2.

SECTION 3. <u>Conditions to Effectiveness of this Waiver</u>. This Waiver shall become effective on the Waiver Effective Date when the following conditions have been satisfied in the sole discretion of Holdco and Company:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Holdco's
 board of directors formally approves the waiver of the Italian Restriction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) this
 Waiver is duly executed and delivered by the parties hereto; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) no
 material breach of the Agreement shall have occurred and be continuing or would result from the execution, delivery or performance
 of this Waiver.

SECTION 4. <u>Conditions Subsequent</u>. This Waiver will continue to be in effect provided that Parent, or any company within Parent Group (i) starts operating an Online Gaming Business pursuant to an Italian online gaming license held by a vehicle directly or indirectly controlled by Parent (the "**Italian Online Operation**") within one year from the Effective Date, and (ii) continues operating the Italian Online Operation, without interruption, pursuant to an Italian online gaming license. For the purposes of this Section, "control" shall have the meaning ascribed to it in section 42 of the Spanish Commercial Code (*Real Decreto de 22 de Agosto de 1885, del Código de Comercio*). For the avoidance of doubt, if conditions (i) and (ii) are not satisfied, this Waiver shall cease to be in effect and Parent shall be subject to the Italian Restriction.

SECTION 5. <u>Indemnity</u> Parent agrees to indemnify and hold harmless Company, Holdco, its successors and assigns, and any of its affiliates and subsidiaries from time to time ("**Codere Online**), and any of their respective directors, officers, agents, members, partners, stockholders and employees and other representatives of any Codere Online company (each, a "**Codere Online Indemnified Party**"), on demand, and on an after-tax basis without any withholding or deduction, from and against any claims, liabilities, losses, damages, costs or expenses (including reasonable legal expenses and attorney's fees) ("**Loss**") incurred by any Codere Online Indemnified Party arising from or in connection with this Waiver, including but not limited to (i) any fine, sanction, penalty or fee imposed by and payable to any regulatory authority, in any jurisdiction, and or (ii) any claims brought by any third party, arising from or in connection with (a) this Waiver, and/or (b) the use of the Licensed Marks by Parent and/or its affiliates with respect to the Online Gaming Business in Italy, and/or (c) the operation by Parent and/or its affiliates of the Online Gaming Business in Italy; provided that no Codere Online Indemnified Party shall be so indemnified with respect to any Loss that is finally determined by a final and non-appealable judgment entered by a court of competent jurisdiction, or pursuant to a settlement agreement agreed to by such Codere Online Indemnified Party, to have resulted from such Codere Online Indemnified Party's bad faith, fraud, willful misconduct or gross negligence or, in the case of a criminal matter, conduct undertaken with knowledge that the conduct was unlawful.

SECTION 6. <u>Effect of this Waiver</u> Except as expressly stated herein, this Waiver shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the parties under the Agreement, and shall not alter, modify, amend or in any other way affect any of the terms, conditions, obligations, covenants or agreements contained in the Agreement, all of which are ratified and affirmed in all respects and shall remain and continue in force and effect in accordance with their terms, and shall constitute and remain as the legal, valid, binding, and enforceable obligations of the parties. Nothing herein shall be deemed to entitle the Parent to any future consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Agreement in similar or different circumstances.

SECTION 7. <u>Governing Law; Choice of Court</u>. This Waiver and any claim, controversy, dispute or cause of action (including non-contractual disputes or claims) based upon, arising out of or relating to this waiver, including the validity, interpretation, construction, breach, enforcement or termination hereof and the transactions contemplated hereby, shall be governed by, and construed in accordance with, the internal laws of the Kingdom of Spain (*Derecho español común*) and will be subject to the exclusive jurisdiction of the Courts of the City of Madrid.

SECTION 8. <u>Severability</u>. The illegality or unenforceability in any jurisdiction of any provision hereof shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Waiver in such jurisdiction or such provision in any other jurisdiction.

SECTION 9. <u>Counterparts</u>. This Waiver may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Waiver by signing any such counterpart. Delivery of an executed counterpart of a signature page of this Waiver by telecopy or other electronic imaging means shall be effective as delivery of a manually executed counterpart of this Waiver.

SECTION 10. <u>Electronic Signatures</u>. Any signature (including any electronic symbol or process attached to, or associated with, a contract or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record) hereto or to any other certificate, agreement or document related to this Waiver, and any contract formation or record-keeping through electronic means shall have the same legal validity and enforceability as a manually executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by applicable law.

[*remainder of page intentionally left blank*]

IN WITNESS WHEREOF, each of the parties hereto has caused this Waiver to be duly executed and delivered as of the date first above written.

---

| |
|:---|
| In acceptance of the waiver of the Italian Restriction pursuant to Section 2 of this Waiver: |
| CODERE ONLINE LUXEMBOURG, S.A., <br> as Holdco |
| By: |
| Name: |
| Title: |
| By: |
| Name: |
| Title: |

---

[*Signature Page to the Waiver of the Relationship and License Agreement*]

---

| |
|:---|
| SERVICIOS DE JUEGO ONLINE, S.A.U.<br> as Company |
| By: |
| Name: |
| Title: |
| By: |
| Name: |
| Title: |

---

[*Signature Page to the Waiver of the Relationship and License Agreement*]

---

| |
|:---|
| Codere Newco, S.A.U.<br> as Parent |
| By: |
| Name: |
| Title: |
| By: |
| Name: |
| Title: |

---

[*Signature Page to the Waiver of the Relationship and License Agreement*]

## Exhibit 8.1

**Exhibit 8.1**

**Subsidiaries of Codere Online Luxembourg, S.A.**

---

| | |
|:---|:---|
| **Name of Subsidiary** | **Jurisdiction of<br> Organization** |
| Asociación en Participación<sup>(1)</sup> | Mexico<sup>(2)</sup> |
| Codere Online Mexico S.A de C.V. | Mexico |
| Codere (Gibraltar) Marketing Services Limited<sup>(2)</sup> | Gibraltar |
| Codere Israel Marketing Support Services Limited | Israel |
| Codere Online Argentina S.A. | Argentina |
| Codere Online Argentina, S.A. Unión Transitoria | Argentina |
| Codere Online Colombia S.A.S. | Colombia |
| Codere Online Management Services Limited<sup>(3)</sup> | Malta |
| Codere Online Operator Limited<sup>(4)</sup> | Malta |
| Operating Management Services Panama, S.A.<sup>(5)</sup> | Panama |
| Codere Online U.S. Corp. | United States |
| Codere Online, S.A.U. | Spain |
| Servicios de Juego Online S.A.U. | Spain |

---

<sup>(1)</sup> "Asociación en Participación" or "AenP" (an unincorporated joint venture) with LIFO, a wholly-owned subsidiary of the Codere Group.

<sup>(2)</sup> Liquidated on January 17, 2024.

<sup>(3)</sup> Liquidated on December 1, 2023.

<sup>(4)</sup> Currently in dissolution, with its liquidation pending approval by the Malta Business Registry. Once approved, the liquidation will be effective as of August 28, 2024.

<sup>(5)</sup> Formerly Codere Online Panama, S.A.

## Exhibit 12.1

**Exhibit 12.1**

**CERTIFICATIONS**

I, Aviv Sher, Chief Executive Officer, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I
 have reviewed this annual report on Form 20-F of Codere Online Luxembourg, S.A.;

&nbsp;&nbsp;&nbsp;&nbsp;2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or
 omit to state a material fact necessary to make the statements made, in light of the circumstances
 under which such statements were made, not misleading with respect to the period covered
 by this report;

&nbsp;&nbsp;&nbsp;&nbsp;3. Based
 on my knowledge, the financial statements, and other financial information included in this
 report, fairly present in all material respects the financial condition, results of operations
 and cash flows of the company as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;4. The
 company's other certifying officer(s) and I are responsible for establishing and maintaining
 disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
 and 15d-15(f)) for the company and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures
 to be designed under our supervision, to ensure that material information relating to the
 company, including its consolidated subsidiaries, is made known to us by others within those
 entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed
 such internal control over financial reporting, or caused such internal control over financial
 reporting to be designed under our supervision, to provide reasonable assurance regarding
 the reliability of financial reporting and the preparation of financial statements for external
 purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated
 the effectiveness of the company's disclosure controls and procedures and presented
 in this report our conclusions about the effectiveness of the disclosure controls and procedures,
 as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed
 in this report any change in the company's internal control over financial reporting
 that occurred during the period covered by the annual report that has materially affected,
 or is reasonably likely to materially affect, the company's internal control over financial
 reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The
 company's other certifying officer(s) and I have disclosed, based on our most recent
 evaluation of internal control over financial reporting, to the company's auditors
 and the audit committee of the company's board of directors (or persons performing
 the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All
 significant deficiencies and material weaknesses in the design or operation of internal control
 over financial reporting which are reasonably likely to adversely affect the company's
 ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any
 fraud, whether or not material, that involves management or other employees who have a significant
 role in the company's internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| Date: June 2, 2025 | By: | /s/ Aviv Sher |
|  |  | Aviv Sher |
|  |  | **Chief Executive Officer**<br> ***(Principal Executive Officer)*** |

---

## Exhibit 12.2

**Exhibit 12.2**

**CERTIFICATIONS**

I, Oscar Iglesias, Chief Financial Officer, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I
 have reviewed this annual report on Form 20-F of Codere Online Luxembourg, S.A.;

&nbsp;&nbsp;&nbsp;&nbsp;2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or
 omit to state a material fact necessary to make the statements made, in light of the circumstances
 under which such statements were made, not misleading with respect to the period covered
 by this report;

&nbsp;&nbsp;&nbsp;&nbsp;3. Based
 on my knowledge, the financial statements, and other financial information included in this
 report, fairly present in all material respects the financial condition, results of operations
 and cash flows of the company as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;4. The
 company's other certifying officer(s) and I are responsible for establishing and maintaining
 disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
 and 15d-15(f)) for the company and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures
 to be designed under our supervision, to ensure that material information relating to the
 company, including its consolidated subsidiaries, is made known to us by others within those
 entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed
 such internal control over financial reporting, or caused such internal control over financial
 reporting to be designed under our supervision, to provide reasonable assurance regarding
 the reliability of financial reporting and the preparation of financial statements for external
 purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated
 the effectiveness of the company's disclosure controls and procedures and presented
 in this report our conclusions about the effectiveness of the disclosure controls and procedures,
 as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed
 in this report any change in the company's internal control over financial reporting
 that occurred during the period covered by the annual report that has materially affected,
 or is reasonably likely to materially affect, the company's internal control over financial
 reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The
 company's other certifying officer(s) and I have disclosed, based on our most recent
 evaluation of internal control over financial reporting, to the company's auditors
 and the audit committee of the company's board of directors (or persons performing
 the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All
 significant deficiencies and material weaknesses in the design or operation of internal control
 over financial reporting which are reasonably likely to adversely affect the company's
 ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any
 fraud, whether or not material, that involves management or other employees who have a significant
 role in the company's internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| Date: June 2, 2025 | By: | /s/ Oscar Iglesias |
|  |  | Oscar Iglesias |
|  |  | **Chief Financial Officer**<br> ***(Principal Financial Officer)*** |

---

## Exhibit 13.1

**Exhibit 13.1**

**CERTIFICATION PURSUANT TO<br> 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO<br> SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

The certification set forth below is being submitted in connection with the annual report on Form 20-F of Codere Online Luxembourg, S.A. (the "Company") for the year ended December 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the "Report") for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United States Code as adopted pursuant to Section 906 of the Sarbanes – Oxley Act of 2002.

I, Aviv Sher, Chief Executive Officer, certify that to the best of my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. the
 Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange
 Act; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The
 information contained in the Report fairly presents, in all material respects, the financial
 condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
| Date: June 2, 2025 | By: | /s/ Aviv Sher |
|  |  | Aviv Sher |
|  |  | **Chief Executive Officer**<br> ***(Principal Executive Officer)*** |

---

## Exhibit 13.2

**Exhibit 13.2**

**CERTIFICATION PURSUANT TO<br> 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO<br> SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

The certification set forth below is being submitted in connection with the annual report on Form 20-F of Codere Online Luxembourg, S.A. (the "Company") for the year ended December 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the "Report") for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United States Code as adopted pursuant to Section 906 of the Sarbanes – Oxley Act of 2002.

I, Oscar Iglesias, Chief Financial Officer, certify that to the best of my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. the
 Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange
 Act; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The
 information contained in the Report fairly presents, in all material respects, the financial
 condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
| Date: June 2, 2025 | By: | /s/ Oscar Iglesias |
|  |  | Oscar Iglesias |
|  |  | **Chief Financial Officer**<br> ***(Principal Financial Officer)*** |

---