Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 203

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1B
Chunk 203
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shares are classified as equity. Transaction costs directly attributable to the issue of common shares, share purchase options (“Options”),
and equity classified warrants are recognized as a deduction from equity, net of any tax effects. When share capital recognized as equity
is repurchased, the amount of the consideration paid, including directly attributable costs, is recognized as a deduction from total
equity.

As
discussed in Note 1(a) above, although the historical financial statements reflect the activity of GSQ, the equity structure, including
equity interest issued, is that of GameSquare (formerly Engine Gaming and Media, Inc.), the legal parent. Accordingly, all share activity
disclosed, and strike or exercise prices where applicable, have been retroactively adjusted to Common shares of GameSquare based on the
exchange ratio of 0.020655 (see Note 4).

(v)
Net loss per share attributable to common shareholders

The
Company calculates earnings per share attributable to common shareholders in accordance with ASC 260-10, Earning Per Share. Basic
net income (loss) per share attributable to common shareholders is calculated by dividing net income (loss) attributable to common shareholders
by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) per common share is calculated
by dividing net income (loss) attributable to common shareholders by weighted-average common shares outstanding during the period plus
all potentially dilutive common shares outstanding during the period, such as warrant shares.

Diluted
earnings per share is computed by dividing undistributed earnings allocated to common stockholders for the period by the weighted average
number of common shares outstanding during the period, plus the dilutive effect of outstanding preferred shares, Options and unvested
share units, and warrants outstanding pursuant to the treasury stock method.

(w)
Share-based payments

The
Company’s share-based payment plan allows Company employees and consultants to acquire shares of the Company. The fair value of
share-based payment awards granted is recognized within share-based payments expense with a corresponding increase in equity.

    F-19

Options

Each
tranche of the Company’s Options is considered a separate award with its own vesting period and grant date fair value. The fair
value is measured at grant date and each tranche is recognized on a straight-line basis over the period during which the share purchase
Options vest. The fair value of the share-based payment awards granted is measured using the Black-Scholes option pricing model taking
into account the terms and conditions