Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 1349

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 8
Chunk 1349
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747 
  
    Restricted cash 
     600,065 
  
    Accounts receivable, net 
     7,933,515 
  
    Prepaid expenses and other current assets 
     1,158,554 
  
    Property and equipment 
     773,893 
  
    Goodwill 
     7,147,428 
  
    Intangible assets 
     12,000,000 
  
    Total assets acquired 
     31,420,202 

    Accounts payable 
     8,067,850 
  
    Accrued liabilities 
     6,844,817 
  
    Deferred revenue 
     1,920,535 
  
    Total liabilities assumed 
     16,833,202 
  
    Net assets acquired 
    $14,587,000 

    (1)
    As
    discussed in Note 3, the Company adopted ASU 2021-08 as of January 1, 2022. As a result, deferred revenue is an exception to the
    measurement guidance of ASC 805 and was instead measured in accordance with ASC 606.

As
part of the settlement of the Lockton case in September 2023, the promissory notes payable in the table above have been
forgiven. As a result, the Company recognized a non-cash gain in gain from discontinued operations on the consolidated statements of
operations and comprehensive loss for the year ended December 31, 2023.

    F-24

The
acquisition date fair value of the arbitration reserve was determined based on a fair value of $6.22 per common share delivered as a
result of the arbitration. The fair value of the arbitration reserve was $0.4 million as of December 31, 2023, based on a fair value
of $1.77 per share, resulting in a gain of $1.0 million for the year ended December 31, 2023 as included on the consolidated statements
of operations and comprehensive loss (see Note 18)

Significant
judgments and assumptions related to the valuation and useful lives of certain classes of assets acquired are as follows:

i)
Intangible assets, software

The
fair value of the software intangible asset of $5.0 million was determined based on the relief from royalty method under the income approach.
The software intangible asset was valued using Level 3 inputs which consisted of the following key inputs: (i) revenue projections; (ii