Company: GAME
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023589
Chunk: 25

Company: GameSquare Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 25
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,500 was issued on August 15, 2024 for consideration
of $4.75 million.

Contemporaneous
with the execution of the June SPA, the Company and M4 entered into a Limited Proxy and Power of Attorney with respect to all of
the shares of Series A-1 Preferred Stock of Faze Media held by M4 (the “Faze Media Voting Proxy”).

Faze
Media is not a variable interest entity. Due to the Faze Media Voting Proxy, the Company maintains a controlling financial interest in
Faze Media and Faze Media is a consolidated subsidiary of the Company as of May 15, 2024 (Faze Media formation date). The Preferred Stock
of Faze Media held by M4 and Gigamoon represent a non-controlling interest of the Company.

As
a result of the above transactions, the Company recorded a non-controlling interest in Faze Media, Inc. of $20.5 million, the sum of
cash consideration received, within the consolidated statements of stockholders’ equity.

(e)
Disposal of Faze Media

Subsequently, on
April 1, 2025, the Company, through its wholly owned subsidiary Faze Media Holdings, LLC, entered into an Exchange Agreement with Gigamoon,
effective April 1, 2025 (the “Exchange Agreement”), pursuant to which the Company agreed to accelerate the conversion
date under Gigamoon’s convertible debenture dated as of December 16, 2024, in the principal amount of $10 million. Pursuant to
the terms of the Exchange Agreement, FaZe Media Holdings, LLC transferred to Gigamoon 5,725,000 shares of Series A-1 Preferred Stock
of FaZe Media, Inc. In addition, GameSquare issued 87,946 shares of its common stock to Gigamoon as payment of accrued interest on the
convertible debenture through the conversion date.

As
a result of the Exchange Agreement, during the three and nine months ended September 30, 2025 and 2024, Faze Media met the requirements
to be reported as discontinued operations (see Note 19). The Company recognized a gain of $3.0 million in Net income (loss) from discontinued
operations in the consolidated statements of operations and comprehensive loss after offsetting the consideration received, conversion
of $10 million Gigamoon convertible debenture discussed above (see Note 10), with the carrying value of the disposed assets and