Sports Entertainment Gaming Global Corp 10-K for FY2022

Sports Entertainment Gaming Global Corp (SEGG)

10-K 2023-06-15 For: 2022-12-31

Added on April 09, 2026

About this 10-K

Sports Entertainment Gaming Global Corp filed this 10-K on June 15, 2023, covering the fiscal year ended December 31, 2022 (FY2022).

Headline figures

Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $6.78M; down 58.7% from $16.41M a year earlier
Net loss: $60M; compared with a net loss of $53.05M a year earlier
Diluted EPS: -$0.70; compared with -$0.24 a year earlier

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20808 State Hwy 71 W, Unit B Spicewood, TX		78669
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.001 per share	LTRY	The Nasdaq Stock Market LLC
Warrants to purchase one share of common stock, each at an exercise price of $11.50	LTRYW	The Nasdaq Stock Market LLC

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

		Page

PART I		1

Item 1.	Business.	1
Item 1A.	Risk Factors.	10
Item 1B.	Unresolved Staff Comments.	53
Item 2.	Properties.	53
Item 3.	Legal Proceedings.	53
Item 4.	Mine Safety Disclosures.	53

PART II		54

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.	54
Item 6.	[Reserved].	54
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	54
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk.	70
Item 8.	Financial Statements and Supplementary Data.	F-1
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.	71
Item 9A.	Controls and Procedures.	71
Item 9B.	Other Information.	73
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.	73

PART III		73

Item 10.	Directors, Executive Officers and Corporate Governance.	73
Item 11.	Executive Compensation.	78
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.	82
Item 13.	Certain Relationships and Related Transactions, and Director Independence.	83
Item 14.	Principal Accounting Fees and Services.	84

PART IV		86

Item 15.	Exhibits, Financial Statement Schedules.	86
Item 16.	Form 10-K Summary	88

●	The findings of the previously disclosed Internal Investigation (as defined herein) and other matters have exposed us to a number of legal proceedings, investigations and inquiries, resulted in significant legal and other expenses, required significant time and attention from our senior management, among other adverse impacts.

●	We and certain of our former officers are, and in the future, we or our officers and directors may become, the subject of legal proceedings, investigations and inquiries by governmental agencies with respect to the findings of the Internal Investigation and other matters, which could have a material adverse effect on our reputation, business, financial condition, cash flows and results of operations, and could result in additional claims and material liabilities.

●	We have been named as a defendant in a number of lawsuits filed by purchasers of our securities, including class action lawsuits that could have a material adverse impact on our business, financial condition, results of operation and cash flows, and our reputation.

●	Matters relating to or arising from the restatement and the Internal Investigation, including adverse publicity and potential concerns from our users, customers or others with whom we do business, have had and could continue to have an adverse effect on our business and financial condition.

●	In July 2022, we furloughed the majority of our employees and suspended our lottery game sales operations after determining that we did not have sufficient financial resources to fund our operations or pay certain existing obligations, including our payroll and related obligations. As a result, we may not be able to continue as a going concern.

●	We need additional capital to, among other things, support and restart our operations, re-hire employees and pay our expenses. Such capital may not be available on commercially acceptable terms, if at all. If we do not receive the additional capital, we may be forced to curtail or abandon our plans to recommence our operations and we may need to permanently cease our operations.

●	If we fail to implement and maintain an effective system of internal controls, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud, and investor confidence and the trading price of our common stock and warrants may be materially and adversely affected.

●	The circumstances that led to the failure to file our annual report and quarterly reports on time, and our efforts to investigate, assess and remediate those matters have caused and may continue to cause substantial delays in our SEC filings.

●	Our inability to compete with other forms of entertainment for consumers’ discretionary time and income.

●	Economic downturns, inflation, geopolitical and political and market conditions beyond our control.

●	Negative events or media coverage relating to our business, our management and directors, the lottery, lottery games or online gaming or betting.

●	Our inability to attract and retain users, including as a result of failing to appear in Internet search engine results.

●	Our continued ability to use domain names to promote and increase the value of our brand.

●	Scrutiny by stakeholders with respect to responsible gaming and ethical conduct.

●	Our ability to achieve profitability and growth in the newly-developed market for online lottery games.

●	Our inability to profitably expand into new markets or capitalize on new gaming and lottery industry trends and changes, such as by developing successful new product offerings.

●	The effectiveness of our marketing efforts in developing and maintaining our brand and reputation.

●	Failure to offer high-quality user support.

●	Adverse impacts to user relationships resulting from disruptions to our information technology.

●	The vulnerability of our information systems to cyberattacks and disruptions caused with respect thereto, including an inability to securely maintain personal and other proprietary user information.

●	Our inability to adapt to changes or updates in the Internet, mobile or personal devices, or new technology platforms or network infrastructures.

●	The exposure of our online infrastructure to risks relating to new and untested distributed ledger technology.

●	Our inability to comply with complex, ever-changing and multi-jurisdictional regulatory regimes and other legal requirements applicable to the gaming and lottery industries.

●	Geopolitical shifts and changes in applicable laws or regulations or the manner in which they are interpreted.

●	Our inability to successfully expand geographically and acquire and integrate new operations.

●	Our dependence on third-party service providers to timely perform services or software component products for our gaming platforms, product offerings and the processing of user payments and withdrawals.

●	Our inability to maintain successful relationships and/or agreements with lottery organizations and other third-party marketing or service provider affiliates.

●	Failure of third-party service providers to protect, enforce, or defend intellectual property rights required to fulfill contractual obligations required for the operation of our business.

●	The effectiveness of our transition and compliance with the regulatory and other requirements of being a newly public company.

●	We are currently not in compliance with the continued listing standards of Nasdaq and may not be able to regain compliance with Nasdaq’s continued listing standards in the future.

●	Limited liquidity and trading of our securities.

●	Woodford (as defined herein) may not loan us the amounts they agreed to under the Loan Agreement (as defined herein).

●	Our obligations under the Loan Agreement are secured by a first priority security interest in substantially all of our assets and if we were to default, they could force us to curtail or abandon our business plans and operations.

●	The issuance and sale of common stock upon conversion of the amounts owed or upon exercise of the warrants issued to Woodford under the Loan Agreement may depress the market price of our common stock and cause substantial dilution

●	We currently owe a significant amount of money under our Loan Agreement, which we may not be able to repay.

●	Other factors described in this Report under the heading “Item 1A. Risk Factors.”

●	ensure that games are conducted fairly and honestly;

●	establish procedures designed to prevent cheating and fraudulent practices;

●	establish and maintain anti-money laundering practices and procedures;

●	establish and maintain responsible accounting practices and procedures;

●	ensure that lottery games are sold only at the price established by the applicable lottery regulator;

●	report prizes awarded and withhold certain amounts for taxes and other specified liabilities;

●	file periodic reports with regulators;

●	establish programs to promote responsible gaming and comply with other social responsibility practices; and

●	enforce minimum age requirements.

●	additional equity or debt financing may not be available to us on satisfactory terms, if at all;

●	if we raise additional funds by issuing equity, equity-linked securities or debt securities, those securities may have rights, preferences or privileges senior to the rights of our currently issued and outstanding equity or debt, and our existing stockholders may experience dilution;

●	loans or other debt instruments may have terms and/or conditions, such as interest rate, restrictive covenants and control or revocation provisions, which are not acceptable to management or our Board;

●	we may not have sufficient funds to repay our debt, which could lead us to default on our obligations; and

●	the current environment in capital markets combined with our capital constraints may prevent us from being able to obtain adequate debt financing.

●	Lack of sufficient number of personnel with an appropriate level of knowledge and experience in accounting for complex or non-routine transactions;

●	The fact that our policies and procedures with respect to the review, supervision and monitoring of our accounting and reporting functions were either not designed and in place or not operating effectively;

●	Deficiencies in the design and operations of the procedures relating to the timely closing of financial books at the quarter and fiscal year end; and

●	Incomplete segregation of duties in certain types of transactions and processes.

●	accountability and transparency requirements, which require those who control data to demonstrate and record compliance and provide certain detailed information to users regarding the ways in which data is used and processed;

●	enhanced data consent requirements, which includes “explicit” consent with regard to information the regulation classifies as sensitive data;

●	obligations to consider data privacy as new products, services and systems are developed, including ways to limit accessibility of data as well as the amount of information collected, processed, and stored;

●	constraints on using data to profile users;

●	obligations to provide users with personal data in a usable format on request and to erase personal data in certain circumstances; and

●	reporting to data protection authorities of potential breaches without undue delay (72 hours, where feasible).

●	product quality, including the possibility of software or hardware defects, which could result in claims against us or the inability to sell our products;

●	the accuracy of our estimates of user or customer demand, and the fit of the new products and features with users’ or customers’ needs;

●	the need to educate our sales, marketing and services personnel to work with the new products and features, which may strain our resources and lengthen sales cycles;

●	market acceptance of initial product releases; and

●	competitor product introductions or regulatory changes that render our new products obsolete.

●	implement additional management information systems;

●	further develop our operating, administrative, legal, compliance, financial and accounting systems and controls;

●	hire additional qualified personnel and develop human capital;

●	comply with additional regulatory regimes, securing licenses, findings of suitability, registrations, permits and approvals; and

●	maintain close coordination among our engineering, operations, legal, compliance, finance, sales and marketing and customer service and support organizations.

●	political instability;

●	international hostilities, military actions, wars, terrorist or cyber-terrorist activities, natural disasters, pandemics, and infrastructure disruptions;

●	differing economic cycles and adverse economic conditions;

●	unexpected changes in regulatory environments and government interference in the economy, including lottery and gaming, data privacy and advertising laws and regulations;

●	changes to economic and anti-money laundering sanctions, laws and regulations;

●	varying tax regimes, including with respect to the imposition of withholding taxes on remittances and other payments by our partnerships or subsidiaries;

●	differing labor regulations;

●	foreign exchange controls and restrictions on repatriation of funds;

●	fluctuations in currency exchange rates;

●	inability to collect payments or seek recourse under or comply with ambiguous or vague commercial or other laws;

●	insufficient protection against product piracy and rights infringement and differing protections for intellectual property rights;

●	varying attitudes towards lottery games and betting by foreign governments;

●	difficulties in attracting and retaining qualified management and employees, or rationalizing our workforce;

●	differing business practices, which may require us to enter into agreements that include non-standard terms; and

●	difficulties in penetrating new markets due to entrenched competitors, lack of recognition of our brands or lack of local acceptance of our products, services and systems.

●	be expensive and time consuming to defend or require us to pay significant amounts in damages;

●	invalidate our proprietary rights;

●	cause us to cease making, licensing or using products, services or systems that incorporate the challenged intellectual property;

●	require us to redesign, reengineer or rebrand our products, services or systems or limit our ability to bring new products, services or systems to the market in the future;

●	require us to enter into costly or burdensome royalty, licensing or settlement agreements in order to obtain the right to undertake a business activity or use a product, process or component;

●	impact the commercial viability of the products, services and systems that are the subject of the claim during the pendency of such claim; and

●	require us by way of injunction to remove products, services, or systems or stop implementing the business practice, or stop selling or offering new products, services.

●	We will indemnify our directors and officers for serving us in those capacities or for serving other business entities at our request, to the fullest extent permitted by the DGCL. The DGCL provides that a corporation may indemnify such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.

●	We may, in our discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law and such person was made a party to an action, suit or proceeding, by reason of the fact that he or she is or was an employee or agent of the Company.

●	We are required to advance expenses, as incurred, to our directors and officers in connection with defending a proceeding, except that such directors or officers shall undertake to repay such advances if it is ultimately determined that such person is not entitled to indemnification.

●	We will not be obligated pursuant to the indemnification agreements entered into with our directors and executive officers to indemnify a person with respect to proceedings initiated by that person, except with respect to proceedings to enforce an indemnitees right to indemnification or advancement of expenses, proceedings authorized by our board of directors and if offered by us in our sole discretion.

●	The rights conferred in our Charter are not exclusive, and we are authorized to enter into indemnification agreements with our directors, officers, employees and agents and to obtain insurance to indemnify such persons.

●	We may not retroactively amend our Charter or indemnification agreement provisions to reduce our indemnification obligations to directors, officers, employees and agents.

●	authorized but unissued shares of common stock and preferred stock, which may be used for a variety of corporate finance transactions, acquisitions and employee benefit plans and the existence of which could make more difficult or discourage an attempt to obtain control of the Company by means of a proxy contest, tender offer, merger or otherwise (the DGCL does not require stockholder approval for any issuance of authorized shares);

●	stockholder action may not be by written consent (the DGCL provides that unless otherwise provided in the charter, any action of a meeting of stockholders may be taken without a meeting and prior notice by signed written consent of stockholders having the minimum number of votes that would be necessary to take such action at a meeting at which all shares entitled to vote thereon were present and voted);

●	amendment of certain provisions of the organizational documents only by the affirmative vote of at least 66 2/3% of the voting power of the outstanding capital stock (the DGCL provides generally that the affirmative vote of a majority of the outstanding shares entitled to vote thereon, voting together as a single class, is required to amend a corporation’s certificate of incorporation, unless the certificate of incorporation requires a greater percentage);

●	provisions providing for a staggered board of directors and detailing that the number of directors may be fixed and modified only by our Board;

●	advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at annual meetings, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of Lottery.com; and

●	the ability of our Board to issue one or more series of preferred stock.

●	providing that directors may be removed only for cause and then only by a two-thirds vote of the holders of a majority of the voting power of the outstanding shares then entitled to vote in an election of directors, voting together as a single class;

●	providing that vacancies on our Board, including newly-created directorships, may be filled only by a majority vote of directors then in office; and

●	prohibiting stockholders from calling special meetings of stockholders.

●	announcements by us or our competitors of new products, features, or services;

●	the public’s reaction to our press releases, other public announcements, and filings with the SEC, including but not limited to, those relating to the Internal Investigation and related events, our financial restatements and the Operational Cessation;

●	rumors and market speculation involving us or other companies in our industry;

●	actual or anticipated changes in our results of operations or fluctuations in our results of operations;

●	changes in the financial projections we may provide to the public or our failure to meet these projections;

●	actual or anticipated developments in our business, our competitors’ businesses or the competitive landscape generally;

●	actual or perceived privacy or data security incidents;

●	risks related to the organic and inorganic growth of our business and the timing of expected business milestones, including those related to announced or completed acquisitions of businesses, products, services, or technologies by us or our competitors;

●	actual or anticipated changes in applicable laws or regulations;

●	changes in accounting standards, policies, guidelines, interpretations, or principles;

●	our ability to forecast or report accurate financial results; and

●	technical factors in the public trading market for our common stock and warrants that may produce price movements that may or may not comport with macro, industry or company-specific fundamentals, including, without limitation, the sentiment of retail investors (including as may be expressed on financial trading and other social media sites), the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock and warrants and any related hedging and other technical trading factors.

●	gross revenue per transaction;

●	gross profit per transaction; and

●	gross margin per transaction.

	Year Ended December 31,
	2022			2021
Transactions Per User		6.86			17.18
Tickets Per Transaction		2.92			3.91
Gross Revenue Per Transaction	$	6.99		$	9.66
Gross Profit Per Transaction	$	1.36		$	1.57
Gross Margin per Transaction		19.4	%		16.29	%

	For the Year Ended December 31,
	2022			2021			$ Change			% Change

Revenue	$	6,779,057		$	16,409,922			(9,630,865	)		-59	%
Cost of revenue		4,310,750			8,158,707			(3,847,957	)		-47	%
Gross profit		2,468,307			8,251,215			(5,782,908	)		-70	%

Operating expenses:
Personnel costs		37,114,485			20,536,328			16,578,157			81	%
Professional fees		6,613,546			8,279,798			(1,666,252	)		-20	%
General and administrative		8,931,681			5,020,495			3,911,186			78	%
Depreciation and amortization		5,601,374			4,292,606			1,308,768			30	%
Total operating expenses		58,261,086			38,129,227			20,131,859			53	%
Loss from operations		(55,792,779	)	$	(29,878,012	)		(25,914,767	)		87	%

Other expenses
Interest expense		764,839			19,789,451			(19,024,612	)		-96	%
Other expense		3,721,291			2,907,518			813,773			28	%
Total other expenses, net		4,486,130			22,696,969			(18,210,839	)		-80	%

Net loss before income tax	$	(60,278,909	)	$	(54,574,981	)		(5,703,928	)		10	%
Income tax expense (benefit)		104,356			(1,664,335	)		1,768,691			100	%
Net loss		(60,383,265	)		(52,910,646	)		(7,472,619	)		14	%

Report of Yusufali & Associates, LLC, Independent Registered Public Accounting Firm (PCAOB ID:3313)		F-2

Consolidated Balance Sheets as of December 31, 2022 and 2021 (as restated)		F-4

Consolidated Statements of Operations and Comprehensive Loss for the Years ended December 31, 2022 and 2021 (as restated)		F-5

Consolidated Statements of Equity for the Years ended December 31, 2022 and 2021 (as restated)		F-6

Consolidated Statements of Cash Flows for the Years ended December 31, 2022 and 2021 (as restated)		F-7

Notes to Consolidated Financial Statements (as restated)		F-8

	2022			2021
	December 31,			December 31,
	2022			2021
ASSETS
Current assets:
Cash	$	102,766		$	32,638,970
Restricted cash		-			-
Accounts receivable		208,647			79,181
Prepaid expenses		19,409,323			22,896,638
Other current assets		718,550			226,200
Total current assets		20,439,286			55,840,989

Notes receivable		2,000,000			-
Investments		250,000			250,000
Goodwill		19,590,758			19,590,758
Intangible assets, net		23,982,445			28,710,980
Property and equipment, net		108,078			141,279
Other long term assets		13,009,686			-
Total assets	$	79,380,253		$	104,534,006

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Trade payables	$	7,607,633		$	1,006,535
Deferred revenue		464,286			1,162,335
Notes payable - current		3,755,676			3,771,340
Accrued interest		484,172			176,260
Accrued and other expenses		4,626,973			4,416,168
Other liabilities		625,028			-
Total current liabilities		17,563,768			10,532,638

Long-term liabilities:
Convertible debt, net - non current		-			-
Other long term liabilities		-			1,169
Total long-term liabilities					1,169
Commitments and contingencies (Note 13)		-			-
Total liabilities		17,563,768			10,533,807

Equity
Controlling Interest		-			-
Preferred Stock, par value $0.001, 1,000,000 shares authorized, none issued and outstanding		-			-
Common stock, par value $0.001, 500,000,000 shares authorized, 50,540,906 and 50,256,317 issued and outstanding as of December 31, 2022 and December 31, 2021, respectively		50,540			50,256
Additional paid-in capital		267,549,357			239,358,644
Accumulated other comprehensive loss		3,622			(655	)
Accumulated deficit		(208,187,210	)		(148,188,138	)
Total Lottery.com Inc. stockholders’ equity		59,416,309			91,220,107
Noncontrolling interest		2,400,176			2,780,092
Total Equity		61,816,485			94,000,199

Total liabilities and stockholders’ equity	$	79,380,253		$	104,534,006

	2022			2021
	Years Ended December 31,
	2022			2021

Revenue	$	6,779,057		$	16,409,922
Cost of revenue		4,310,750			8,158,707
Gross profit		2,468,307			8,251,215

Operating expenses:
Personnel costs		37,114,485			20,536,328
Professional fees		6,613,546			8,279,798
General and administrative		8,931,681			5,020,495
Depreciation and amortization		5,601,374			4,292,606
Total operating expenses		58,261,086			38,129,227
Loss from operations		(55,792,779	)		(29,878,012	)

Other expenses
Interest expense		764,839			19,789,451
Reserve loss of prepaid advertising credits		-			2,000,000
Other expense		3,721,291			2,907,518
Total other expenses, net		4,486,130			24,696,969

Net loss before income tax		(60,278,909	)		(54,574,981	)
Income tax expense (benefit)		104,356			(1,664,335	)
Net loss		(60,383,265	)		(52,910,646	)

Other comprehensive loss
Foreign currency translation adjustment, net		4,277			(655	)
Comprehensive loss		(60,378,988	)		(52,911,301	)

Net income attributable to noncontrolling interest		379,916			(136,924	)
Net loss attributable to Lottery.com Inc.	$	(59,999,072	)	$	(53,048,225	)

Net loss per common share
Basic and diluted	$	(1.19	)	$	(2.04	)

Weighted average common shares outstanding
Basic and diluted		50,444,493			25,998,831

	Shares		Amount		Capital			Deficit			Income			Equity			Interest			Interest
	Common Stock				Additional Paid-In			Accumulated			Accumulated Other Comprehensive			Total AutoLotto Inc. Stockholders’			Noncontrolling			Total Stockholder’s
	Shares		Amount		Capital			Deficit			Income			Equity			Interest			Equity
Balance as of December 31, 2020	22,658,006	$	22,658	$	111,752,883		$	(95,140,568	)	$	-		$	16,634,973		$	-		$	16,634,973

Issuance of common stock upon stock option exercise	737,732		738		252,979			-			-			253,717			-			253,717
Issuance of common stock upon warrant exercise	177,684		177		117,833			-			-			118,009			-			118,009
Effect of reverse capitalization, net	11,384,655		11,385		38,942,930			-			-			38,954,315			-			38,954,315
Conversion of convertible debt	11,162,735		11,163		64,764,379			-			-			64,775,542			-			64,775,542
Issuance of common stock in business acquisition	687,439		687		459,004			-			-			459,691			-			459,691
Beneficial conversion feature on notes payable	-		-		8,480,697			-			-			8,480,697			-			8,480,697
Issuance of digital securities	-		-		108,331			-			-			108,331			-			108,331
Stock-based compensation	3,448,066		3,448		14,479,608			-			-			14,483,057			-			14,483,057
Minority interest in business acquisition	-		-		-			-			-			-			2,643,168			2,643,168
Other comprehensive loss	-		-		-			-			(655	)		(655	)		-			(655	)
Net loss	-		-		-			(53,047,570	)		-			(53,047,570	)		136,924			(52,910,646	)

Balance as of December 31, 2021	50,256,317		50,256		239,358,644			(148,188,138	)		(655	)		91,220,107			2,780,092			94,000,199
Beginning Balance	50,256,317		50,256		239,358,644			(148,188,138	)		(655	)		91,220,107			2,780,092			94,000,199

Issuance of common stock upon stock option exercise	60,116		60		(60	)		-			-			-			-			-
Issuance of common stock for legal settlement	60,000		60		241,680			-			-			241,740			-			241,740
Stock based compensation	164,473		164		27,949,093			-			-			27,949,257			-			27,949,257
Other comprehensive loss	-		-		-			-			4,277			4,277			-			4,277
Comprehensive loss	-		-		-			(59,999,072	)		-			(59,999,072	)		(379,916	)		(60,378,988	)
Balance as of December 31, 2022	50,540,906	$	50,540	$	267,549,357		$	(208,187,210	)	$	3,622		$	59,416,309		$	2,400,176		$	61,816,485
Ending Balance	50,540,906	$	50,540	$	267,549,357		$	(208,187,210	)	$	3,622		$	59,416,309		$	2,400,176		$	61,816,485

Computers and equipment		3 years
Furniture and fixtures		5 years
Software		3 years


Cash	$	517,460
Accounts receivable, net		34,134
Prepaids		5,024
Property and equipment, net		2,440
Other assets, net		65,349
Intangible assets		8,590,000
Goodwill		4,940,643
Total assets	$	14,155,051

Accounts payable and other liabilities	$	(387,484	)
Customer deposits		(134,707	)
Related party loan		(417,017	)
Total liabilities	$	(939,208	)

Total net assets of Acquirees	$	13,215,843

Category	Fair Value

Customer relationships	$	410,000
Gaming licensees		4,020,000
Trade names and trademarks		2,540,000
Technology		1,620,000

Total Intangibles	$	8,590,000

	December 31, 2022								December 31, 2021
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Amortizing intangible assets
Customer relationships	6 years	$	1,350,000	$	(781,385	)	$	568,615	$	1,350,000	$	(556,387	)	$	793,613
Trade name	6 years		2,550,000		(642,222	)		1,907,778		2,550,000		(217,223	)		2,332,777
Technology	6 years		3,050,000		(1,437,778	)		1,612,222		3,050,000		(929,444	)		2,120,556
Software agreements	6 years		14,450,000		(5,968,611	)		8,481,389		14,450,000		(3,145,277	)		11,304,723
Gaming license	6 years		4,020,000		(1,005,000	)		3,015,000		4,020,000		(335,000	)		3,685,000
Internally developed software	2 - 10 years		2,904,473		(350,232	)		2,554,241		2,192,050		(23,323	)		2,168,727
Domain name	15 years		6,935,000		(1,091,750	)		5,843,250		6,935,000		(629,416	)		6,305,584
		$	35,259,473	$	(11,276,978	)	$	23,982,495	$	34,547,050	$	(5,836,070	)	$	28,710,980

Years ending December 31,	Amount
2023	$	5,319,214
2024		4,876,562
2025		4,556,562
2026		4,556,562
Thereafter		4,673,595
Total	$	23,982,495


Issuance of Common Stock for legal settlement			60,000
Exercise of options (Note 10)			60,116
Restricted stock award			164,473

Total			284,589