Company: GAME
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023589
Chunk: 31

Company: GameSquare Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 31
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 in the third quarter of 2025 to discontinue the operations of Frankly (Note 19), the remaining value of
goodwill and intangible assets of Frankly were impaired. Goodwill and intangible assets impairment charges were $5.1 million and $3.4
million, respectively, and were recorded within Net income (loss) from discontinued operations on the consolidated statements of operations
and comprehensive loss.

(c)
Intangible assets, indefinite lived

On
July 24, 2025, the Company entered into a subscription agreement, pursuant to which the subscriber purchased from the Company 3,433.33
shares of Series A-1 Convertible Preferred Stock of the Company, par value $0.0001 per share (Note 11), in consideration for Crypto Punk
5577 non-fungible token (“NFT”), which was deemed to have a fair market value of $5.15 million.

Regarding
the NFT, CryptoPunks launched as a fixed set of 10,000 items in mid-2017. Rare and highly sought-after “Cowboy Ape” CryptoPunk
NFT from Robert Leshner, founder of the DeFi protocol Compound and CEO of Superstate. Valued for its rarity and historical significance
as one of only 24 Ape CryptoPunks in existence, the Cowboy Ape is widely regarded as the most desirable CryptoPunks of the 10,000-piece
collection and NFTs in general.

In
addition to the acquisition of the Cowboy Ape NFT, the Company acquired an additional seven crypto punks using ETH valued at $1.8 million
at the time of purchase.

Digital
assets outside the scope of ASC 350-60, such as non-fungible tokens (“NFTs”), are accounted for as indefinite-lived intangible
assets under ASC 350-30.

There
were no impairment charges related to indefinite-lived intangible assets incurred during the three and nine months ended September 30,
2025.

    15

8.
Leases

On
June 30, 2021, the Company acquired Complexity. Complexity leased a building in Frisco, Texas. Upon the sale of Complexity (see Note
4), the lease was assigned to GameSquare Esports (USA), Inc. and the Company entered into an agreement to sublease the building to Complexity
for a 12-month period. The lease has an original lease period expiring in April 2029. The lease