Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 543

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 3
Chunk 543
---
 on these instruments.

Loss on debt extinguishment

We recognized a loss on debt extinguishment of $1.0
million during the year ended December 31, 2024, in comparison to $2.2 million for the year ended December 31, 2023. The Company recognized
a day one loss on issuance of debt of $1.4 million on July 8, 2024 in connection with the issuance of the Yorkville CD. The loss is presented
net of the $0.3 million gain on extinguishment of the King Street CD which was paid down in full on July 10, 2024. The 2023 loss was due
to the extinguishment of the EB CD as part of a convertible note refinance.

Change in fair value of convertible debt carried
at fair value

Change in fair value of convertible debt gain for
the year December 31, 2024, was $0.6 million in comparison to $0.5 million for the year ended December 31, 2023. The variance was not
significant.

20

Change in fair value of investment

Change in fair value of investment for the year December
31, 2024 was $0.5 million, in comparison to $0.5 million loss for the year ended December 31, 2023. The variance was not significant.

Change in fair value of warrant liability

Change in fair value of warrant liability gain was
$80 thousand for the year ended December 31, 2024, in comparison to gain of $1.0 million for the year ended December 31, 2023. Prior
to the Engine acquisition, we did not have any liability measured warrants. The gain represents adjusting the liability measured warrants
to fair value at the end of the reporting period, primarily driven by changes in our share price. The large reduction in gain is
primarily driven by the expiration of the majority of the liability measured warrants, and therefore the change in fair value over the
current period is not significant.

Arbitration settlement reserve

Arbitration settlement reserve was $0.2 million gain
for the year ended December 31, 2024, in comparison to gain of $1.0 million for the year ended December 31, 2023. Prior
to the Engine acquisition, we did not have an arbitration settlement reserve. The change represents adjusting the arbitration settlement
reserve to fair value at the end of the reporting period, primarily driven by changes