Company: LTRYW
Filing Date: 2025-05-21
Form Type: 10-Q
Source: 0001641172-25-011865
Chunk: 36

Company: Lottery.com Inc.
Filing Date: 2025-05-21
Form: 10-Q
Item: Part I, Item 2
Chunk 36
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2022 Financials”),
should no longer be relied upon. Armanino advised that it had determined, subsequent to the 2021 Audit and review of the March 2022 Financials,
that the Company had entered into a line of credit in January 2022 that was not disclosed in the footnotes to the 2021 Audit and was
not properly recorded in the March 2022 Financials.

On
July 28, 2022, the Board determined that the Company did not have sufficient financial resources to fund its operations or pay certain
existing obligations, including its payroll and related obligations, due to a significant misstatement of our cash balances.

The
following day, on July 29, 2022, the Company effectively ceased operations (the “ Operational Cessation”), when it furloughed
the majority of its employees and generally suspended its lottery game sales. The Company’s remaining employees were limited to
the heads of the product, information technology and human resources teams as well as the entire legal and compliance team. Within one
week, several additional employees were recalled from furlough. All non-furloughed employees were retained, at the discretion of the
Company’s then Chief Operating Officer and Chief Legal Officer, to provide the minimal business functions needed to address the
Company’s legal and compliance issues and to secure necessary funding to resume the Company’s operations. Only a few of these
non-furloughed employees remain active in the efforts to restore Company operations and as of March 31, 2025, there remains approximately
$4.08 million in outstanding payroll obligations that remained unpaid.

   2  

On
September 27, 2022, Armanino resigned as the independent registered public accounting firm of the Company, effective immediately and
subsequently, on October 7, 2022, the Audit Committee approved the engagement of Yusufali & Associates, LLC, (“ Yusufali”)
as the Company’s new independent registered public accounting firm.

Since
the 2022 Operational Cessation, the Company has had minimal day-to-day operations in the United States and has primarily focused on restarting
certain of its core businesses (as described in more detail under “ Plans for Recommencement of Company Operations

Nasdaq
Listing

On
March 23, 2023, the Company requested a hearing before the Nasdaq Hearings Panel (the “ Panel”) to appeal a determination
by the Listing Qualifications department (the “ Staff