Company: GAME
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023589
Chunk: 144

Company: GameSquare Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 144
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 1,079,136 warrants were issued with an exercise price
of $1.55 and a contractual term of 5 years. The relative fair value of the warrants of $1.1 million was estimated using the Black-Scholes
option pricing model with the following assumptions: share price of $1.56, expected dividend yield of 0%, expected volatility rate of
120.00%, based on the historical volatility of comparable companies, a risk free rate of 3.36% and an expected life of 5 years. The warrants
have an exercise price in USD and are equity-classified.

The
Company had 8,439,638 equity-classified warrants with a weighted average exercise price of $9.54 outstanding as of September 30, 2025
and 1,854,551 equity-classified warrants with a weighted average exercise price of $37.63 outstanding as of December 31, 2024.

15.
Related party transactions

(a)
Convertible debenture with a director of the Company as counterparty

On
September 1, 2022, Engine extended convertible debentures that were due to expire in October and November 2022 with an aggregate principal
amount of $1.3 million. Key terms include (a) maturity date of August 31, 2025, (b) interest rate of 7% (interest to be paid in full
at maturity) and (c) conversion price of $4.40. The convertible debenture is beneficially held by a director of the Company. The convertible
debenture matured in the third quarter of 2025 (see Note 10).

(b)
Promissory note with significant investor

On
March 25, 2025, the “Company entered into a secured promissory note with Blue & Silver Ventures, Ltd. The principal amount
of $2 million under the promissory note is payable on demand and no later than July 1, 2025. The promissory note bears interest at a
rate of ten percent (10%) per annum, with a default interest rate of fifteen percent (15%) per annum, and is payable on demand and no
later than July 1, 2025 with the principal amount. The Company, at its option, may prepay the promissory note, in whole or in part, without
a prepayment penalty of any kind.

In
connection with the promissory note, the