Mobile Esports (MGAM) - 2023 Q1 - Quarterly Report

Financial Performance - The company reported a net loss of $812,084 for the three months ended March 31, 2023, compared to a net loss of $91,482 for the same period in 2022, indicating an increase in losses of approximately 789%[16] - Operating expenses for the three months ended March 31, 2023, were $815,731, significantly higher than $91,482 for the same period in 2022, reflecting an increase of approximately 791%[16] - The company had no revenue reported for the three months ended March 31, 2023, consistent with the same period in 2022[16] - Due to the net loss incurred, diluted net loss per share is the same as basic net loss per share for all periods presented[71] Assets and Liabilities - Total current assets decreased from $8,132,921 as of December 31, 2022, to $7,444,163 as of March 31, 2023, representing a decline of approximately 8.5%[14] - The company's accumulated deficit increased from $1,549,388 as of December 31, 2022, to $2,360,480 as of March 31, 2023, representing an increase of approximately 52.2%[14] - The total liabilities rose from $246,268 as of December 31, 2022, to $428,417 as of March 31, 2023, indicating an increase of approximately 73.7%[14] - Cash and cash equivalents decreased from $7,559,674 at the beginning of the period to $6,794,473 at the end of the period, a decrease of approximately 10.1%[21] - Total accounts payable and accrued expenses increased to $222,846 as of March 31, 2023, compared to $80,960 as of December 31, 2022, with significant increases in accrued consulting and professional fees and other accrued expenses[54] Shareholder Information - The weighted average common shares outstanding increased from 16,809,800 in Q1 2022 to 20,421,593 in Q1 2023, an increase of approximately 21.5%[16] - The Company has authorized the issuance of 100,000,000 shares of common stock, with 20,421,593 shares issued and outstanding as of March 31, 2023[59] Compensation and Expenses - The Company’s CEO and CFO received a total compensation of $52,500 during the three months ended March 31, 2023, reflecting the company's commitment to its leadership[55] - The Company recorded total expense of approximately $72,000 for warrant amortization in Q1 2023, compared to $46,000 in Q1 2022[66] Warrants and Commitments - The Company issued 170,000 2023 Consultant Warrants with an exercise price of $3.00, vesting 25% in Q1 2023 and the remainder quarterly through December 31, 2023[60] - The estimated fair value of the 2023 Consultant Warrants was $91,000, with $26,000 recognized as expense for Q1 2023[61] - The estimated fair value of the PIPE Warrants was approximately $2,093,000, with 1,886,793 warrants issued at an exercise price of $2.90[64] - The estimated fair value of the IPO Warrants was approximately $474,000, with 172,500 warrants issued at an exercise price of $6.60[63] - The Company has a commitment of $1,200,000 for the development of an Esports Platform, with $1,041,074 paid as of March 31, 2023[68] Other Financial Information - The Company has $23,305 in restricted cash as of March 31, 2023, up from $20,000 as of December 31, 2022, held in an escrow account from the initial public offering[31] - The cash paid for operating leases for the three months ended March 31, 2023, approximated $11,700, with an operating lease cost recorded of approximately $12,300[51] - The Company has a total of $142,273 in present value of operating lease liabilities as of March 31, 2023, with future lease payments totaling $162,464[52] - The Company has made advance payments totaling $480,000 for potential future services and a deposit of $100,000 for the potential acquisition of an intangible asset as of March 31, 2023[48] - The Company has outstanding principal of approximately $45,000 under a financing agreement for insurance policies, with monthly payments of $15,848 due until June 2023[57] - The Company had an unamortized warrant expense of approximately $576,000 as of March 31, 2023, to be amortized over a weighted-average period of 1.6 years[66] - The Company has no material uncertain tax positions for any of the reporting periods presented, indicating a stable tax position[45] - The Company has no material litigation that could impact its financial position[67] Property and Equipment - As of March 31, 2023, the Company reported property and equipment, net, of $29,399, an increase from $16,822 as of December 31, 2022, reflecting a depreciation expense of approximately $1,000 for the three months ended March 31, 2023[49] MOGO Pvt Ltd Impact - MOGO Pvt Ltd comprised approximately 10.2% of the company's net loss for the three months ended March 31, 2023, compared to nil for the same period in 2022[24]