Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 31, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 001-39170 | ||
Entity Registrant Name | ELYS GAME TECHNOLOGY, CORP. | ||
Entity Central Index Key | 0001080319 | ||
Entity Tax Identification Number | 33-0823179 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Address, Address Line One | 130 Adelaide Street | ||
Entity Address, Address Line Two | West | ||
Entity Address, Address Line Three | Suite 701 | ||
Entity Address, City or Town | Toronto | ||
Entity Address, State or Province | ON | ||
Entity Address, Country | CA | ||
Entity Address, Postal Zip Code | M5H 2K4 | ||
City Area Code | 561-838-3325 | ||
Local Phone Number | 838-3325 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | ELYS | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 14,924,140 | ||
Entity Common Stock, Shares Outstanding | 38,812,842 | ||
Auditor Name | BDO AG | ||
Auditor Location | Zurich, Switzerland | ||
Auditor Firm ID | 5988 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 3,400,166 | $ 7,319,765 |
Accounts receivable | 731,962 | 271,161 |
Gaming accounts receivable | 1,431,497 | 2,418,492 |
Prepaid expenses | 900,205 | 968,682 |
Related party receivable | 22,511 | 1,413 |
Other current assets | 338,871 | 403,972 |
Total Current Assets | 6,825,212 | 11,383,485 |
Non - Current Assets | ||
Restricted cash | 364,701 | 386,592 |
Property and equipment | 610,852 | 490,079 |
Right of use assets | 1,498,703 | 589,288 |
Intangible assets | 10,375,524 | 15,557,561 |
Goodwill | 1,662,278 | 16,164,337 |
Marketable securities | 19,999 | 7,499 |
Total Non - Current Assets | 14,532,057 | 33,195,356 |
Total Assets | 21,357,269 | 44,578,841 |
Current Liabilities | ||
Bank overdraft | 7,520 | |
Accounts payable and accrued liabilities | 6,790,523 | 6,820,279 |
Gaming accounts payable | 2,213,532 | 2,610,305 |
Taxes payable | 179,720 | 47,787 |
Related party payable | 422,129 | 502 |
Promissory notes payable - related parties | 752,000 | 51,878 |
Operating lease liability | 369,043 | 244,467 |
Financial lease liability | 6,831 | 8,347 |
Bank loan payable - current portion | 3,151 | 36,094 |
Total Current Liabilities | 10,736,929 | 9,827,179 |
Non-Current Liabilities | ||
Contingent Purchase Consideration | 12,859,399 | |
Deferred tax liability | 1,696,638 | 3,291,978 |
Operating lease liability | 1,157,979 | 340,164 |
Financial lease liability | 2,288 | 7,716 |
Bank loan payable | 148,169 | 151,321 |
Other long-term liabilities | 464,851 | 359,567 |
Total Non – Current Liabilities | 3,469,925 | 17,010,145 |
Total Liabilities | 14,206,854 | 26,837,324 |
Stockholders' Equity | ||
Preferred stock, $0.0001 par value; 5,000,000 shares authorized, none issued | ||
Common stock, $0.0001 par value, 80,000,000 shares authorized; 30,360,810 and 23,363,732 shares issued and outstanding as of December 31, 2022 and 2021 | 3,036 | 2,336 |
Additional paid-in capital | 74,249,244 | 66,233,292 |
Accumulated other comprehensive (loss) income | (600,619) | (251,083) |
Accumulated deficit | (66,501,246) | (48,243,028) |
Total Stockholders' Equity | 7,150,415 | 17,741,517 |
Total Liabilities and Stockholders’ Equity | $ 21,357,269 | $ 44,578,841 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 80,000,000 | 80,000,000 |
Common Stock, Shares, Issued | 30,360,810 | 23,363,732 |
Common Stock, Shares, Outstanding | 30,360,810 | 23,363,732 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive (Loss) Income - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
Revenue | $ 42,678,659 | $ 45,546,791 |
Costs and Expenses | ||
Selling expenses | 32,705,928 | 36,274,752 |
General and administrative expenses | 19,977,275 | 17,466,786 |
Depreciation and Amortization | 1,832,204 | 1,351,173 |
Impairment of indefinite lived assets and goodwill | 20,583,502 | 17,350,628 |
Total Costs and Expenses | 75,098,909 | 72,443,339 |
Loss from Operations | (32,420,250) | (26,896,548) |
Other (Expenses) Income | ||
Interest expense, net | (43,599) | (20,985) |
Amortization of debt discount | (12,833) | |
Change in fair value of contingent purchase consideration | 12,859,399 | 11,857,558 |
Other income | 22,045 | 227,788 |
Other expense | (108,548) | (49,967) |
Gain (loss) on marketable securities | 12,500 | (460,000) |
Total Other Income (Expenses) | 12,741,797 | 11,541,561 |
Loss Before income taxes | (19,678,453) | (15,354,987) |
Income tax benefit | 1,420,235 | 290,476 |
Net Loss | (18,258,218) | (15,064,511) |
Other Comprehensive Loss | ||
Foreign currency translation adjustment | (349,536) | (519,031) |
Comprehensive Loss | $ (18,607,754) | $ (15,583,542) |
Loss per common share - basic and diluted | $ (0.70) | $ (0.67) |
Weighted average number of common shares outstanding - basic and diluted | 26,254,972 | 22,500,716 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders Equity - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 2,003 | $ 53,064,919 | $ 267,948 | $ (33,178,517) | $ 20,156,353 |
Shares, Issued at Dec. 31, 2020 | 20,029,834 | ||||
Common stock issued to settle liabilities | $ 53 | 2,676,849 | 2,676,902 | ||
Common stock issued to settle liabilities, shares | 533,790 | ||||
Proceeds from warrants exercised | $ 151 | 3,962,330 | 3,962,481 | ||
Proceeds From Warrants Exercised,Shares | 1,509,809 | ||||
Acquisition of Bookmakers Company US, LLC | $ 127 | 4,544,177 | 4,544,304 | ||
Shares issued in consideration of acquisition, shares | 1,265,823 | ||||
Shares issued for services | $ 2 | 139,998 | 140,000 | ||
Shares issued in consideration of acquisition, shares | 24,476 | ||||
Stock based compensation expense | 1,845,019 | 1,845,019 | |||
Foreign currency translation adjustment | (519,031) | (519,031) | |||
Net loss | (15,064,511) | (15,064,511) | |||
Ending balance, value at Dec. 31, 2021 | $ 2,336 | 66,233,292 | (251,083) | (48,243,028) | 17,741,517 |
Shares, Issued at Dec. 31, 2021 | 23,363,732 | ||||
Proceeds from warrants exercised | $ 54 | 512,758 | 512,812 | ||
Proceeds From Warrants Exercised,Shares | 541,227 | ||||
Proceeds from private placement | $ 263 | 2,486,924 | 2,487,187 | ||
Proceeds from private placement, shares | 2,625,000 | ||||
Brokers fees on private placement | (245,950) | (245,950) | |||
Proceeds from open market sales | 17 | 387,036 | 387,053 | ||
Brokers Fees on open market sales | (11,612) | (11,612) | |||
Restricted stock compensation | $ 366 | 2,012,234 | 2,012,600 | ||
Restricted stock compensation, shares | 3,662,835 | ||||
Stock based compensation expense | 2,874,562 | 2,874,562 | |||
Foreign currency translation adjustment | (349,536) | (349,536) | |||
Net loss | (18,258,218) | (18,258,218) | |||
Proceeds from open market sales, shares | 168,016 | ||||
Ending balance, value at Dec. 31, 2022 | $ 3,036 | $ 74,249,244 | $ (600,619) | $ (66,501,246) | $ 7,150,415 |
Shares, Issued at Dec. 31, 2022 | 30,360,810 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Cash Flows [Abstract] | ||
Net loss | $ (18,258,218) | $ (15,064,511) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 1,832,204 | 1,351,174 |
Amortization of debt discount | 12,833 | |
Impairment of license and goodwill | 20,583,502 | 17,350,628 |
Non-cash interest | 36,489 | 9,265 |
Change in Fair Value Contingent Consideration | (12,859,399) | (11,857,558) |
Unrealized (gain) loss on marketable securities | (12,500) | 460,000 |
Shares issued for services | 2,012,600 | 140,000 |
Stock based compensation expense | 2,874,562 | 1,845,019 |
Loss on sale of asset | 5,719 | |
Gain on settlement of liabilities | (7,977) | |
Bad debt expense | (98,167) | |
Deferred taxation movement | (1,595,340) | (196,434) |
Changes in Operating Assets and Liabilities | ||
Prepaid expenses | 61,049 | (632,012) |
Accounts payable and accrued liabilities | 294,120 | 1,663,340 |
Accounts receivable | (400,499) | (145,367) |
Gaming accounts receivable | 767,794 | (933,273) |
Gaming accounts payable | (244,567) | (270,063) |
Taxes payable | 135,678 | (865,174) |
Due from related parties | 400,003 | (1,979) |
Other long-term liabilities | 123,426 | 86,480 |
Other current assets | 43,901 | (44,626) |
Long term liabilities | (355,109) | |
Net Cash used in Operating Activities | (4,200,016) | (7,553,511) |
Cash Flows from Investing Activities | ||
Acquisition of property and equipment, and intangible assets | (2,905,386) | (717,080) |
Acquisition of Bookmakers Company US, LLC, net of cash of $26,161 | (5,973,839) | |
Proceeds on disposal of asset | 27,939 | |
Net Cash used in Investing Activities | (2,877,447) | (6,690,919) |
Cash Flows from Financing Activities | ||
Proceeds private placement and open market sales - net of fees | 2,616,678 | |
Proceeds from warrants exercised | 3,962,482 | |
Proceeds from bank overdraft | (6,969) | 4,047 |
Repayment of bank line of credit | (500,000) | |
Repayment of bank loan | (35,038) | (133,742) |
Repayment of debentures | (27,562) | |
Proceeds from from promissory notes payable - related parties | 665,000 | |
Proceeds from pre- funded warrants | 512,812 | |
Repayment of government relief loan | (27,586) | |
Deferred purchase price payments | (410,383) | |
Proceeds from finance leases | 1,881 | |
Repayment of finance leases | (7,808) | (10,172) |
Net Cash provided by Financing Activities | 3,746,556 | 2,857,084 |
Effect of change in exchange rate | (610,583) | (951,066) |
Net decrease in cash | (3,941,490) | (12,338,412) |
Cash and cash equivalents and restricted cash– beginning of the year | 7,706,357 | 20,044,769 |
Cash and cash equivalents and restricted cash – end of the year | 3,764,867 | 7,706,357 |
Reconciliation of cash, cash equivalents and restricted cash within the Balance Sheets to the Statements of Cash Flows | ||
Cash and cash equivalents | 3,400,166 | 7,319,765 |
Restricted cash included in non-current assets | 364,701 | 386,592 |
Supplemental disclosure of cash flow information | ||
Interest | 8,678 | 39,682 |
Income tax | 43,171 | 805,030 |
Supplemental cash flow disclosure for non-cash activities | ||
Settlement of liabilities by the issuance of common stock | 2,676,902 | |
Acquisition of Bookmakers Company US, LLC by the issuance of common stock | $ 4,544,304 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Statement of Cash Flows [Abstract] | |
Acquistion of Bookmakers Company US, LLC | $ 26,161 |
1. Nature of Business
1. Nature of Business | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
1. Nature of Business | 1. Nature of Business Established in the state of Delaware in 1998, Elys Game Technology, Corp (“Elys” or the “Company”), provides gaming services in the U.S. market via Elys Gameboard Technologies, LLC and Bookmakers Company US, LLC (“US B ”) in certain licensed states where the Company offers bookmaking and platform services to the Company’s customers. The Company’s intention is to focus its attention on expanding the U.S. market. The Company recently began operation in Washington D.C. through a Class B Managed Service Provider and Class B Operator license to operate a sportsbook within the Grand Central Restaurant and Sportsbook located in the Adams Morgan area of Washington, D.C., and in October 2021 the Company entered into an agreement with Ocean Casino Resort in Atlantic City, New Jersey, to provide platform and bookmaking services. Ocean Casino Resort began using the Company’s platform and bookmaking services in March 2022. The Company also provides business-to-consumer (“B2C”) gaming services in Italy through its subsidiary, Multigioco, which operations are carried out via both land-based or online retail gaming licenses regulated by the Agenzia delle Dogane e dei Monopoli (“ADM”) that permits the Company to distribute leisure betting products such as sports betting, and virtual sports betting products through both physical, land-based retail locations as well as online through the Company’s licensed website www.newgioco.it or commercial webskins linked to the Company’s licensed website and through mobile devices. Management implemented a consolidation strategy in the Italian market by integrating all B2C operations into Multigioco and allowed the Austrian Bookmakers license, that was regulated by the Austrian Federal Finance Ministry (“BMF”), to terminate. Additionally, the Company provides business-to-business (“B2B”) gaming technology through its Odissea subsidiary which owns and operates a betting software designed with a unique “distributed model” architecture colloquially named Elys Game Board (the “Platform”). The Platform is a fully integrated “omni-channel” framework that combines centralized technology for updating, servicing and operations with multi-channel functionality to accept all forms of customer payment through the two distribution channels described above. The omni-channel software design is fully integrated with a built in player gaming account management system, built-in sports book and a virtual sports platform through its Virtual Generation subsidiary. The Platform also provides seamless application programming interface integration of third-party supplied products such as online casino, poker, lottery and horse racing and has the capability to incorporate e-sports and daily fantasy sports providers. Management implemented a growth strategy to expand B2B gaming technology operations in the U.S. and is considering further expansion in Canada and Latin American countries in the near future. Strategic agreements entered into with Lottomatica (currently known as G.B.O, S.p.A) During the second quarter of the 2022 financial year, the Company entered into a Master Technology Development and License Agreement and a Technical Services Agreement with Lottomatica to develop and provide a dedicated Sports Betting Platform (“SBP”) for use in both land-based and on-line applications by Lottomatica in the U.S. and Canadian markets, as well as potentially worldwide. The contract is for a period of ten years, after which the source code will be assigned to Lottomatica. An option was also granted to Lottomatica that after a period of four years from the commencement of the provision of the SBP, that Lottomatica may acquire the source code to the SBP for €4.0 million. The Technical Services Agreement was entered into with the Company’s subsidiary Odissea to provide engineering services, develop and deliver the software and provide operational and product management support to Lottomatica on the SBP. The initial term of the agreement is for a period of ten years and is based on cost plus a percentage of the services provided. In a separate Virtual Service Agreement entered into between the Company’s subsidiary Virtual Generation and Goldbet S.p.A., a subsidiary of Lottomatica, whereby Virtual Generation will license virtual event content to be implemented on the Lottomatica’s Platform throughout the Lottomatica vast network of retail outlets and on the online services in Italy. The agreement provides for an exclusivity period of two years from the date of certification of the virtual platform by the Italian regulator (ADM), which will only allow Lottomatica and the Company to make use of the platform. Virtual Generation will generate commission revenue based on a percentage of Net Gaming Revenues. In a separate Assignment Agreement entered into between the Company’s subsidiary, Multigioco, Lottomatica assigned ownership of 100 Sports Rights to Multigioco, which will allow Multigioco to expand its land-based distribution network to 110 point-of-sale locations. Multigioco activated 53 location rights during the second half of 2022 and expects to activate the remaining 47 locations over the first half of 2023. These rights are only valid until the ADM puts new location rights up for tender, which could take place at any time, and therefore were assigned a minimal value. The entities included in these consolidated financial statements are as follows: Name Acquisition or Formation Date Domicile Functional Currency Elys Game Technology, Corp. (“Elys”) Parent Company USA U.S. dollar Multigioco Srl (“Multigioco”) August 15, 2014 Italy Euro Ulisse GmbH (“Ulisse”) July 1, 2016 Austria Euro Odissea Betriebsinformatik Beratung GmbH (“Odissea”) July 1, 2016 Austria Euro Virtual Generation Limited (“VG”) January 31, 2019 Malta Euro Newgioco Group Inc. (“NG Canada”) January 17, 2017 Canada Canadian dollar Elys Technology Group Limited April 4, 2019 Malta Euro Newgioco Colombia SAS November 22, 2019 Colombia Colombian peso Elys Gameboard Technologies, LLC May 28, 2020 USA U.S. dollar Bookmakers Company US, LLC July 15, 2021 USA U.S. dollar Elys US Game Technologies and Services, LLC July 1, 2022 USA U.S. dollar The Company operates in two lines of business: (i) the operating of web based betting as well as land based leisure betting establishments situated throughout Italy and; (ii) provider of certified betting Platform software services to global leisure betting establishments and operators. The Company’s operations are carried out through the following four geographically organized groups: a) an operational group based in Europe that maintains administrative offices headquartered in Rome, Italy with satellite offices for operations administration in Naples and Teramo, Italy and San Gwann, Malta; b) an operational group based in the U.S. with offices in Las Vegas, Nevada; c) a technology group which is based in Innsbruck, Austria and manages software development, training, and administration; and d) a corporate group which is based in North America and maintains an executive suite in Las Vegas, Nevada and a space in Toronto, Ontario, Canada through which the Company carries-out corporate activities, handles day-to-day reporting and U.S. development planning, and through which various employees, independent contractors and vendors are engaged. |
2. Accounting Policies and Esti
2. Accounting Policies and Estimates | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
2. Accounting Policies and Estimates | 2. Accounting Policies and Estimates Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The company previously had a secondary listing on the NEO exchange in Canada, which was terminated with effect from December 31, 2021. For the purposes of its previous listing in Canada, the Company is an “SEC Issuer” as defined under National Instrument 52-107 “Accounting Principles and Audit Standards” “Continuous Disclosure Obligations” Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries, all of which are wholly-owned. All significant inter-company transactions are eliminated upon consolidation. All amounts referred to in the Notes to the consolidated financial statements are in United States Dollars ($) unless stated otherwise. Foreign operations The Company translated the assets and liabilities of its foreign subsidiaries into US Dollars at the exchange rate in effect at year end and the results of operations and cash flows at the average rate throughout the year. The translation adjustments are recorded directly as a separate component of stockholders’ equity, while transaction gains (losses) are included in net income (loss). Revenues were generated in US Dollars, Euros and Colombian Pesos during the years presented. Gains and losses from foreign currency transactions are recognized in current operations. Business Combinations The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods, using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. Actual results could differ from those estimates. These estimates and assumptions include valuing equity securities issued in share-based payment arrangements, determining the fair value of assets acquired, allocation of purchase price, impairment of long-lived intangible assets and goodwill, the collectability of receivables, leasing arrangements, convertible debentures, contingent purchase consideration, contingencies and the value of deferred taxes and related valuation allowances. Certain estimates, including evaluating the collectability of receivables and advances, could be affected by external conditions, including those unique to the Company’s industry and general economic conditions. It is possible that these external factors could have an effect on the Company’s estimates that could cause actual results to differ from the Company’s estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. Loss Contingencies The Company may be subject to claims, suits, government investigations, and other proceedings involving competition and antitrust, intellectual property, privacy, indirect taxes, labor and employment, commercial disputes, content generated by our users, goods and services offered by advertisers or publishers using the Company’s website platforms, and other matters. Certain of these matters include speculative claims for substantial or indeterminate amounts of damages. The Company records a liability when it believes that it is both probable that a loss has been incurred, and the amount can be reasonably estimated. If the Company determines that a loss is possible, and a range of the loss can be reasonably estimated, it discloses the range of the possible loss in the Notes to the Consolidated Financial Statements. The Company evaluates, on a regular basis, developments in its legal matters that could affect the amount of liability that has been previously accrued, and the matters and related ranges of possible losses disclosed and makes adjustments and changes to our disclosures as appropriate. Significant judgment is required to determine both likelihood of there being and the estimated amount of a loss related to such matters. Until the final resolution of such matters, there may be an exposure to loss in excess of the amount recorded, and such amounts could be material. Should any of the Company’s estimates and assumptions change or prove to have been incorrect, it could have a material impact on its business, consolidated financial position, results of operations, or cash flows. To date, none of these types of litigation matters, most of which are typically covered by insurance, has had a material impact on the Company’s operations or financial condition. The Company has insured and continues to insure against most of these types of claims. Fair Value Measurements ASC Topic 820, Fair Value Measurement and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This topic also establishes a fair value hierarchy which requires classification based on observable and unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. The carrying value of the Company's accounts receivables, gaming accounts receivable, lines of credit - bank, accounts payable, gaming accounts payable and bank loans payable approximate fair value because of the short-term maturity of these financial instruments. Derivative Financial Instruments ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirements of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as described. Cash and Cash Equivalents The Company primarily places cash balances in the U.S. with high-credit quality financial institutions located in the United States which are insured by the Federal Deposit Insurance Corporation up to a limit of $ 250,000 $100,000 €100,000 To date, the Company has not been exposed to the recent U.S. bank failures and we do not anticipate any adverse impact on the Company’s cash balances. Gaming Accounts Receivable Gaming accounts receivable represent gaming deposits made by customers to their online gaming accounts either directly by credit card, bank wire, e-wallet or other accepted method through one of our websites or indirectly by cash collected at the cashier of a betting shop but not yet credited to the Company’s bank accounts and subject to normal trade collection terms without discounts. The Company periodically evaluates the collectability of its gaming accounts receivable and considers the need to record or adjust an allowance for doubtful accounts based upon historical collection experience and specific customer information. Actual amounts could vary from the recorded estimates. The Company does not require collateral to support customer receivables. The Company recorded a release from the bad debt provision of $ 13,051 $98,167 0 $0 Gaming Accounts Payable Gaming accounts payable represent customer balances, including winnings and deposits, that are held as credits in online gaming accounts and have not as of yet been used or withdrawn by the customers. Customers can request payment of winnings from the Company at any time and the payment to customers can be made through bank wire, credit card, or cash disbursement from one of our locations. Online gaming account credit balances are non-interest bearing. Long Lived Assets The Company evaluates the carrying value of its long-lived assets for impairment by comparing the expected undiscounted future cash flows of the assets to the net book value of the assets when events or circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. If the expected undiscounted future cash flows are less than the net book value of the assets, the excess of the net book value over the estimated fair value will be charged to earnings. Fair value is based upon discounted cash flows of the assets at a rate deemed reasonable for the type of asset and prevailing market conditions, appraisals, and, if appropriate, current estimated net sales proceeds from pending offers. Property and Equipment Property and equipment is stated at acquisition cost less accumulated depreciation and adjustments for impairment losses. Expenditures are capitalized only when they increase the future economic benefits embodied in an item of property and equipment. All other expenditures are recognized as expenses in the statement of operations as incurred. Depreciation is charged on a straight-line basis over the estimated remaining useful lives of the individual assets. Amortization commences from the time an asset is put into operation. The range of the estimated useful lives is as follows: Plant and Equipment Useful lives Description Useful Life Leasehold improvements Life of the underlying lease Computer and office equipment 3 to 5 years Furniture and fittings 7 to 10 years Computer Software 3 to 5 years Vehicles 4 to 5 years Intangible Assets Intangible assets are stated at acquisition cost less accumulated amortization, if applicable, less any adjustments for impairment losses. Amortization is charged on a straight-line basis over the estimated remaining useful lives of the individual intangibles. Where intangibles are deemed to be impaired the Company recognizes an impairment loss measured as the difference between the estimated fair value of the intangible and its book value. The range of the estimated useful lives is as follows: Intangible Useful lives Description Useful Life (in years) Betting Platform Software 15 Multigioco and Rifa ADM Licenses 1.5 to 7 Location contracts 5 to 7 Customer relationships 10 to 18 Trademarks/Tradenames 10 to 14 Websites 5 Non-compete agreements 4 Goodwill The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. The Company annually assesses whether the carrying value of its reporting unit exceeds its fair value and, if necessary, records an impairment loss equal to any such excess. Each interim reporting period, the Company assesses whether events or circumstances have occurred which indicate that the carrying amount of the reporting unit exceeds its fair value. If the carrying amount of the reporting unit exceeds its fair value, an asset impairment charge will be recognized in an amount equal to that excess. In terms of ASC 350, the Company performed a qualitative assessment and based on the outcome of the qualitative assessment, performed a quantitative analysis on its goodwill as of December 31, 2022 and determined that an impairment of 14,501,669 Leases The Company accounts for leases in terms of ASC 842. In terms of ASC 842, the Company assesses whether any asset based leases entered into for periods longer than twelve months meet the definition of financial leases or operation leases, by evaluating the terms of the lease, including the following; the duration of the lease; the implied interest rate in the lease; the cash flows of the lease; and whether the Company intends to retain ownership of the asset at the end of the lease term. Leases which imply that the Company will retain ownership at the end of the lease term are classified as financial leases, are included in property and equipment with a corresponding financial liability raised at the date of lease inception. Interest incurred on financial leases are expensed using the effective interest rate method. Leases which imply that the Company will not acquire the asset at the end of the lease term are classified as operating leases, the Company’s right to use the asset is reflected as a non-current right of use asset with a corresponding operational lease liability raised at the date of lease inception. The right of use asset and the operational lease liability are amortized over the right of use period using the effective interest rate implied in the operating lease agreement. Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity's financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has no material uncertain tax positions for any of the reporting periods presented. In Italy, tax years beginning 2017 forward, are open and subject to examination, while in Austria companies are open and subject to inspection for five years and ten years for inspection of serious infractions. In the United States and Canada, tax years beginning 2017 forward, are subject to examination. The Company is not currently under examination and it has not been notified of a pending examination. Contingent Purchase Consideration The Company estimates and records the acquisition date estimated fair value of contingent consideration as part of the purchase price consideration for acquisitions. At each reporting period, the Company estimates changes in the fair value of contingent consideration, and any change in fair value is recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss). An increase in the earn-out expected to be paid will result in a charge to operations in the year that the anticipated fair value of contingent consideration increases, while a decrease in the earn-out expected to be paid will result in a credit to operations in the year that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made regarding future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. Future revisions to these assumptions could materially change the estimate of the fair value of contingent consideration and therefore, materially affect the Company’s future financial results. Additional information regarding contingent consideration is provided in Note 4 and 12. Revenue Recognition The Company recognizes revenue when control of its products and services is transferred to its customers in an amount that reflects the consideration the Company expects to receive from its customers in exchange for those products and services. Revenues from sports-betting, casino, cash and skill games, slots, bingo and horse race wagers represent the gross pay-ins (also referred to as turnover) from customers less gaming taxes and payouts to customers. Revenues are recorded when the game is closed which is representative of the point in time at which the Company has satisfied its performance obligation. In addition, the Company receives commissions from the sale of scratch tickets and other lottery games. Commissions are recorded when the ticket for scratch off tickets and lottery tickets are sold. Revenues from the Betting Platform include software licensing fees, training, installation, and product support services. The Company does not sell its proprietary software. Revenue is recognized when transfer of control to the customer has been made and the Company’s performance obligation has been fulfilled. • License fees are calculated as a percentage of each licensee’s level of activity and are contingent upon the licensee’s usage. The license fees are recognized on an accrual basis as earned. • Training fees, installation fees are recognized when each task has been completed. • Product support services are recognized based on the nature of the agreement with our customers, ad-hoc support service revenue will be recognized when the task is completed and revenue from product support service contracts will be recognized on a periodic basis where we charge a recurring fee to provide ongoing support services. Stock-Based Compensation The Company records its compensation expense associated with stock options and other forms of equity compensation based on their fair value at the date of grant using the Black-Scholes option pricing model. Stock-based compensation includes amortization related to stock option awards based on the estimated grant date fair value. Stock-based compensation expense related to stock options is recognized ratably over the vesting period of the option. In addition, the Company records expense related to Restricted Stock Units (“RSU’s”) granted based on the fair value of those awards on the grant date. The fair value related to the RSUs is amortized to expense over the vesting term of those awards. Forfeitures of stock options and RSUs are recognized as they occur. Stock-based compensation expense for a stock-based award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, including foreign currency translation adjustments. Earnings Per Share Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 260, “Earnings Per Share” provides for calculation of “basic” and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the dilutive impact on the number of shares outstanding should they be exercised. Securities that have the potential to dilute shareholder's interests include unexercised stock options and warrants as well as unconverted debentures. Related Parties Parties are considered to be related to the Company if the parties directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Recent Accounting Pronouncements The Financial Accounting Standards Board (“FASB”) issued additional updates during the year ended December 31, 2022. None of these standards are either applicable to the Company or require adoption at a future date and none are expected to have a material impact on the Company’s condensed consolidated financial statements upon adoption. Reporting by segment The Company has two operating segments from which it derives revenue. These segments are: (i) the operating of web based as well as land based leisure betting establishments situated throughout Italy, and (ii) provider of certified betting Platform software services to leisure betting establishments in Italy and 9 other countries. |
3. Going Concern
3. Going Concern | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
3. Going Concern | 3. Going Concern The Company’s financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The accompanying financial statements for the period ended December 31, 2022 have been prepared assuming the Company will continue as a going concern, but the ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund ongoing development work of its gaming platforms and operations until we are able to generate revenue streams from our additional gaming platforms and become profitable. These factors, individually and collectively indicate that a material uncertainty exists that raises substantial doubt about the Company's ability to continue as a going concern for one year from the date of issuance of these audited consolidated financial statements. Management’s plans to continue as a going concern include raising additional capital through sales of equity securities and borrowing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. If the Company is not able to obtain the necessary additional financing on a timely basis, the Company will be required to delay, and reduce the scope of the Company’s development and operations. Continuing as a going concern is dependent upon its ability to successfully secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
4. Acquisition of subsidiaries
4. Acquisition of subsidiaries | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
4. Acquisition of subsidiaries | 4. Acquisition of subsidiaries On July 5, 2021, the Company entered into a Membership Purchase Agreement (the “Purchase Agreement”) to acquire 100% of Bookmakers Company US LLC, a Nevada limited liability company doing business as US Bookmaking, from its members (the “Sellers”). On July 15, 2021 the Company consummated the acquisition of US B and in terms of the Purchase Agreement the Company acquired 100% of US B , from its members (the “Sellers”) and US B became a wholly owned subsidiary of the Company. US B is a provider of sports wagering services such as design and consulting, turn-key sports wagering solutions, and risk management. Pursuant to the terms of the Purchase Agreement, the consideration paid for all of the equity of US B was $6 million in cash plus the issuance of 1,265,823 $4,544,304 The Sellers will have an opportunity to receive up to an additional $ 38,000,000 Purchase Agreement exceeds 4,401,020 and with a cap of 5,065,000 on the aggregate number of shares to be issued. $24,716,957 The goodwill of $ 27,024,383 in the sports betting market in the US markets which should facilitate the Company’s penetration into the U.S. market. None of the goodwill is expected to be deducted for income tax purposes. In terms of the agreement, the purchase price was allocated to the fair market value of tangible and intangible assets acquired and liabilities assumed as follows: Amount Consideration Cash $ 6,000,000 1,265,823 shares of common stock at fair market value 4,554,304 Contingent purchase consideration 24,716,957 Total purchase consideration $ 35,261,261 Recognized amounts of identifiable assets acquired and liabilities assumed Cash 26,161 Other Current assets 151,284 Property and equipment 788 Other non-current assets 4,000 Tradenames/Trademarks 1,419,000 Customer relationships 7,275,000 Non-compete agreements 2,096,000 $ 10,972,233 Less: liabilities assumed Current liabilities assumed (264,135 ) Non-current liabilities assumed (205,320 ) Imputed Deferred taxation on identifiable intangible acquired (2,265,900 ) $ (2,735,355 ) Net identifiable assets acquired and liabilities assumed 8,236,878 Goodwill 27,024,383 Total purchase consideration $ 35,261,261 The amount of revenue and earnings included in the Company’s consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2022 and the revenue and earnings of the combined entity had the acquisition date been January 1, 2021. Proforma Revenue and Earnings Revenue Earnings Actual for December 31, 2022 $ 1,105,986 $ (1,064,889) 2021 Supplemental pro forma from January 1, 2021 to December 31, 2021 $ 45,957,894 $ (15,887,232 ) The 2021 Supplemental pro forma information was adjusted to exclude $ 125,479 579,519 |
5. Restricted Cash
5. Restricted Cash | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Cash Equivalents [Abstract] | |
5. Restricted Cash | 5. Restricted Cash Restricted cash consists of |
6. Property and equipment
6. Property and equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
6. Property and equipment | 6. Property and equipment December 31, 2022 December 31, 2021 Cost Accumulated depreciation Net book value Net book value Leasehold improvements $ 58,808 $ 40,932 $ 17,876 $ 27,260 Computer and office equipment 1,166,394 858,792 307,602 223,214 Fixtures and fittings 437,442 277,320 160,122 135,433 Vehicles 14,574 14,574 — 44,837 Computer software 336,455 211,203 125,252 59,335 $ 2,013,673 $ 1,402,821 $ 610,852 $ 490,079 The aggregate depreciation charge to operations was $ 240,724 $230,033 |
7. Leases
7. Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
7. Leases | 7. Leases The Company’s portfolio of leases contains both finance and operating leases that relate to real estate agreements, vehicles and office equipment agreements. Operating leases Real estate agreements The Company has several property lease agreements in Italy and Austria and one lease agreement in the US, which have terms in excess of a twelve month period, these property leases are for our administrative operations in these countries. The Company does not and does not intend to take ownership of the properties at the end of the lease term. Vehicle agreements The Company leases several vehicles for business use purposes, the terms of these leases range from twenty four to thirty six months. The Company does not and does not intend to take ownership of the vehicles at the end of the lease term. Finance Leases Office equipment agreements The Company has entered into several finance leases for office equipment, the term of these leases range from thirty six to sixty months. The Company takes ownership of the office equipment at the end of the lease term. Right of use assets Right of use assets included in the consolidated balance sheet are as follows: December 31, 2022 December 31, 2021 Non-current assets Right of use assets - operating leases, net of amortization $ 1,498,703 $ 589,288 Right of use assets - finance leases, net of depreciation – included in property and equipment $ 8,884 $ 15,520 Lease costs consists of the following: Year ended December 31, 2022 2021 Finance lease cost: $ 8,005 $ 10,906 Amortization of right-of-use assets 7,536 10,102 Interest expense on lease liabilities 469 804 Operating lease cost 408,062 244,639 Total lease cost $ 416,067 $ 255,545 Other lease information: Year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ (469 ) $ (804 ) Operating cash flows from operating leases (408,062 ) (244,639 ) Financing cash flows from finance leases (7,809 ) (10,172 ) Right-of-use assets obtained in exchange for new finance leases 1,881 — Right-of-use assets disposed of under operating leases prior to lease maturity (61,769 ) (224,793 ) Right-of -use assets obtained in exchange for new operating leases $ 1,351,211 $ 406,276 Weighted average remaining lease term – finance leases 1.75 1.93 Weighted average remaining lease term – operating leases 4.06 2.60 Weighted average discount rate – finance leases 4.98 % 3.73 % Weighted average discount rate – operating leases 3.02 % 2.73 % Maturity of Leases Finance lease liability The amount of future minimum lease payments under finance leases as of December 31, 2022 is as follows: Finance lease liability Amount 2023 $ 7,142 2024 1,260 2025 488 2026 488 2027 and thereafter 366 Total undiscounted minimum future lease payments 9,744 Imputed interest (625 ) Total finance lease liability $ 9,119 Disclosed as: Current portion $ 6,831 Non-Current portion 2,288 $ 9,119 Operating lease liability The amount of future minimum lease payments under operating leases as of December 31, 2022 is as follows: Operating lease liability Amount 2023 $ 426,238 2024 356,755 2025 316,349 2026 279,540 2027 and thereafter 264,650 Total undiscounted minimum future lease payments 1,643,532 Imputed interest (116,510 ) Total operating lease liability $ 1,527,022 Disclosed as: Current portion $ 369,043 Non-Current portion 1,157,979 $ 1,527,022 |
8. Intangible Assets
8. Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
8. Intangible Assets | 8. Intangible Assets Licenses obtained by the Company in the acquisitions of Multigioco and Rifa include a Gioco a Distanza (“GAD”) online license as well as a Bersani and Monti land-based licenses issued by the Italian gaming regulator to Multigioco and Rifa, respectively. Intangible assets consist of the following: December 31, 2022 December 31, 2021 Cost Impairment charge Accumulated amortization Net Net book Betting platform software $ 8,628,105 $ — $ (1,851,619 ) $ 6,776,486 $ 4,745,895 Licenses 973,333 — (961,469 ) 11,864 3,413 Location contracts 1,000,000 — (1,000,000 ) — — Customer relationships 8,145,927 (4,750,000 ) (1,072,022 ) 2,323,905 7,538,533 Trademarks 1,537,318 — (274,049 ) 1,263,269 1,413,887 Non-compete agreement 2,096,000 (1,331,833 ) (764,167 ) — 1,855,833 Websites 40,000 — (40,000 ) — — $ 22,420,683 $ (6,081,833 ) $ (5,963,326 ) $ 10,375,524 $ 15,557,561 The Company recorded $ 1,591,139 1,120,757 , and $4,827,914 The estimated amortization expense over the next five-year period is as follows: Amortization Expense Amount 2023 $ 1,198,162 2024 1,193,704 2025 1,189,997 2026 1,188,997 2027 1,181,999 Total estimated amortization expense $ 5,953,859 The Company evaluates intangible assets for impairment on an annual basis during the last month of each year and at an interim date if indications of impairment exist. Intangible asset impairment is determined by comparing the fair value of the asset to its carrying amount with an impairment being recognized only when the fair value is less than carrying value and the impairment is deemed to be permanent in nature. In assessing the impairment of indefinite lived licenses, the Company first performed a qualitative impairment test to determine if any impairment indicators were present, impairment indicators were noted for indefinite life intangibles assets in the Ulisse operation. The impairment process used was as follows: • based on qualitative impairment indicators bring present; • the Company utilized management’s December 2022 annual operational budget cash flows for the 2022 year together with forecasted cash flows for the next four-year period ending in 2026; • the budgeted and forecasted cash flows were adjusted for taxation at the Company’s current effective tax rate; • working capital cash flow movements were estimated for the budget and the forecast period using historical experience; • property and equipment cash flow additions for the budget and forecast period were estimated using historical experience and known cash flows; • net cash flow as determined by the above, were forecast in perpetuity by using the forecast growth rate and the Company’s estimated Weighted Average Cost of Capital (“WACC”); • The forecast future cash flows were discounted back to present value using the WACC; • WACC was determined by comparing the Company’s beta to that of certain peer companies and determining what a reasonable WACC was compared to our calculated internal WACC, we determined that due to recent volatility in the Company’s common stock price that a reasonable peer WACC is 14.75%. Impairment of intangibles related to the acquisition of US B ookmaking On July 20, 2022, the Company received notice that on July 17, 2022, an action (the “Action”) was commenced in the Eighth Judicial District Court, Clark County, Nevada, Case No. A-22-855524-B, by Victor J. Salerno, Robert Kocienski and Robert Walker (“Plaintiffs”), against the Company and Bookmakers Company US LLC d/b/a U.S. Bookmaking (“US B ,” and together with the Company collectively “Defendants”). Plaintiffs’ claims against the Company related to the Membership Interest Purchase Agreement, dated July 5, 2021, pursuant to which Plaintiffs sold their membership interests in US B to the Company. Plaintiffs’ claimed relief asserted in the Action include, without limitation, breach of contract, breach of implied covenants, intentional interference with contract and negligent misrepresentation. The Plaintiffs sought a judgment for damages against the Company, including punitive damages, as well as declaratory relief against both US B and the Company. The Company believed the Action was completely without merit and on September 29, 2022, the Court denied in all respects the Plaintiffs’ emergency motion for a preliminary injunction which resulted in the action being dismissed by the Plaintiffs on September 30, 2022. The relationship between the Company and the plaintiffs is no longer viable and the Company has instituted its own action against the Plaintiffs, see legal proceedings below. During October 2022, the executive management and several other employees abandoned their positions at US B due to the dispute with the Company related to the performance of US B and the ongoing financial demands linked to that performance. The Company re-evaluated the forecasts prepared by the previous US B management and the lack of new customers as originally forecast and revised those estimates downwards to current supportable business. This resulted in a significant impairment of the value assigned to goodwill, the non-compete agreements with US B management, and the value originally assigned to customer relationships predicated on improving the revenues generated from those customers. Based on a quantitative impairment analysis performed by management, an impairment charge of $4,750,000 on the US B customer relationships was considered appropriate with a carrying value of $1,935,590 remaining as of December 31, 2022, in addition, an impairment charge of $1,331,833 of the remaining carrying value of the non-compete agreements was considered appropriate. Ulisse License During 2021, the COVID-19 pandemic resulted in the closure of our land-based operations in the Italian market for an extended period of time and as the pandemic evolved and the markets in which the Company operated continued to experience resurgences of the virus, we were uncertain as to the long-term impact on the Company’s land-based operations. As such, the Company made a strategic decision to transfer its Ulisse customer relationships in Italy to Multigioco ahead of license renewals which are expected to take place within the next one to two years. The combined Multigioco and Ulisse business under the Multigioco entity, which is an Italian based operator, substantially increased the Company’s market share in Italy, and may improve the possibility of renewing our Italian licenses. Ulisse is based in Austria and during the fourth quarter of 2021, management decided to apply its limited resources and concentrate all of its efforts on developing the US and North American markets, thereby deciding to allow the Austrian bookmaking license to lapse by not renewing the cash deposits required to retain the license. The license under which Ulisse operated in Italy, was not transferable to Multigioco and accordingly, based on a quantitative impairment analysis, an impairment charge of the remaining carrying value of the license of $4,827,914 was considered appropriate for the year ended December 31, 2021. The Company believes that the remaining carrying amounts of its intangible assets are recoverable. However, if adverse events were to occur or circumstances were to change indicating that the carrying amount of such assets may not be fully recoverable, the assets would be reviewed for impairment and the assets may be further impaired. |
9. Goodwill
9. Goodwill | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
9. Goodwill | 9. Goodwill December 31, 2022 December 31, 2021 Cost Opening balance as of January 1, $ 28,687,051 $ 1,663,120 Acquisition of US Bookmaking 27,024,383 Foreign exchange movements (390 ) (452 ) Closing balance as of December 31. 28,686,661 28,687,051 Accumulated Impairment charge Opening balance as of January 1, (12,522,714 ) — Impairment charge (14,501,669 ) (12,522,714) Closing balance as of December 31, (27,024,383 ) (12,522,714) Goodwill, net of impairment charges $ 1,662,278 $ 16,164,337 Goodwill represents the excess purchase price paid over the fair value of assets acquired, including any other identifiable intangible assets. The Company evaluates goodwill for impairment on an annual basis during the last month of each year and at an interim date if indications of impairment exist. Goodwill impairment is determined by comparing the fair value of the reporting unit to its carrying amount with an impairment being recognized only when the fair value is less than carrying value and the impairment is deemed to be permanent in nature. Impairment of goodwill related to US B ookmaking As discussed in note 8 above, Impairment of intangibles related to the acquisition of US B ookmaking , the Company performed a quantitative impairment analysis based on a revised forecast of future revenues and profit projections of US B based on the current customer base resulting in a significant impact on the current valuation of US B which resulted in a goodwill impairment charge of approximately $14,501,669 and $12,522,714 for the years ended December 31, 2022 and 2021, respectively. |
10. Marketable Securities
10. Marketable Securities | 12 Months Ended |
Dec. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
10. Marketable Securities | 10. Marketable Securities Investments in marketable securities consists of 2,500,000 shares of Zoompass Holdings (“Zoompass”) and is accounted for at fair value, with changes recognized in earnings. On December 31, 2022, the shares of Zoompass were last quoted at $0.008 $12,500 460,000 |
11. Bank Loan Payable
11. Bank Loan Payable | 12 Months Ended |
Dec. 31, 2022 | |
Federal Home Loan Banks [Abstract] | |
11. Bank Loan Payable | 11. Bank Loan Payable In September 2016, the Company obtained a loan of € 500,000 545,000 4.5% 57 9,760 In terms of a directive by the Italian Government, in order to provide financial relief due to the COVID-19 pandemic, Multigioco was able to suspend repayments of the loan for a period of six months and the maturity date of the loan was extended to March 31, 2022, the interest rate remained the same at 4.5% above the Euro Inter Bank Offered Rate with monthly repayments revised to $ 9,971 €29,913 $34,159 29,059 33,184 854 $975 Included in bank loans is a Small Business Administration Disaster Relief loan (“SBA Loan”) assumed on the acquisition of USB with a principal outstanding of $ 150,000 . The SBA Loan bears interest at 3.75% per annum and is repayable in monthly installments of $731 which began in June 2021, and matures in May 2050. The SBA Loan is collateralized by all of USB’s tangible and intangible assets. The balance outstanding at December 31, 2022 consists of principal outstanding of $150,000 and interest thereon of $1,320. Since acquisition of US B , the Company has repaid principal of $5,570 6,890 The maturity of bank loans payable as of December 31, 2022 is as follows: Amount Within 1 year $ 3,151 1 to 2 years 3,272 2 to 3 years 3,396 3 to 4 years 3,526 5 years and thereafter 137,975 Total $ 151,320 Disclosed as: Current portion $ 3,151 Non-Current portion 148,169 $ 151,320 |
12. Contingent Purchase Conside
12. Contingent Purchase Consideration | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure 12.Contingent Purchase Consideration Abstract | |
12. Contingent Purchase Consideration | 12. Contingent Purchase Consideration In terms of the acquisition of US B disclosed in Note 4 above, the Sellers will have an opportunity to receive up to an additional $38,000,000 plus a potential premium of 10% (or $3,800,000) based upon achievement of stated adjusted cumulative EBITDA milestones during the next four years, payable 50% in cash and 50% in the Company’s stock at a price equal to volume weighted average price of the company’s common stock for the 90 consecutive trading days preceding January 1 of each subsequent fiscal year for the duration of the earnout period ending December 31, 2025, subject to obtaining shareholder approval, if the aggregate number of shares to be issued pursuant to the Purchase Agreement exceeds 4,401,020 and with a cap of 5,065,000 on the aggregate number of shares to be issued. Any excess not approved by shareholders or exceeding the cap will be paid in cash. The Company had an independent third party valuation entity perform a Purchase Price Analysis which included the probability of the Sellers achieving the additional proceeds of $ 41,800,000 Contingent purchase consideration is considered at each reporting period. Contingent purchase consideration is based on cumulative EBITDA for the period July 15, 2021 to December 31, 2025, with the first measurement period being December 31, 2022. The forecasts provided by the vendors at the time of performing the business valuation was based on achieving a certain number of new customers on an annual basis. Based on the current legal dispute with the vendors and previous management of US Bookmaking we reviewed and adjusted the forecasts to include only current US Bookmaking customers which resulted in a forecast of no contingent purchase consideration being due. The remaining contingent purchase consideration of $ 12,859,399 Sellers. Any change in the fair value of contingent purchase consideration is recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss). The estimate of the fair value of contingent consideration requires subjective assumptions to be made regarding future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. Due to the uncertainty regarding the achievement of the stated unadjusted accumulated EBITDA milestones and the methodology in determining the number of shares to be issued during each earnout period and the potential restriction on the number of shares available for issue, the contingent purchase consideration is classified as a liability. The movement in contingent purchase consideration is s follows: December 31, 2022 December 31, 2021 Opening balance $ 12,859,399 $ — Contingent purchase consideration measured on the acquisition of US Bookmaking — 24,716,957 Changes in fair value (12,859,399 ) (11,857,558 ) Closing balance $ - $ 12,859,399 |
13. Other Long-term Liabilities
13. Other Long-term Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
13. Other Long-term Liabilities | 13. Other Long-term Liabilities Other long-term liabilities represent the Italian “Trattamento di Fine Rapporto” which is a severance amount set up by Italian companies to be paid to employees on termination or retirement. Balances of other long-term liabilities were as follows: Other long-term liabilities December 31, 2022 December 31, 2021 Severance liability $ 464,851 $ 359,567 |
14. Related Parties
14. Related Parties | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
14. Related Parties | 14. Related Parties Promissory notes payable – Related Parties On September 26, 2022, the Company entered into an equipment loan agreement with Braydon Capital Corp, for the principal sum of $ 500,000 $360,000 9% The loan is secured by the equipment, consisting of kiosks, which are to be acquired out of the proceeds of the loan. To date, the Company has not taken delivery of any of the kiosks. Braydon Capital Corp is managed by Mr. Claudio Ciavarella, the brother of the Chairman of the Board. Prior to the acquisition of US B , Victor Salerno had advanced US B $100,000 of which $50,000 was forgiven and the remaining $50,000 is still owing to Mr. Salerno, which amount earns interest at 8% per annum, compounded monthly and is repayable on October 1, 2022. Between February 23, 2022 and September 22, 2022, Mr. Salerno advanced US B an additional $305,000 in terms of purported promissory notes, bearing interest at 10% per annum and repayable between June 30, 2022 and November 30, 2022. These purported promissory notes contain a default clause whereby any unpaid principal would attract an additional 25% penalty and additional interest of 5% per annum. These notes were advanced to US B without the consent of the Company, which is required as per the terms of the Members Interest Purchase Agreement entered into on July 15, 2021. Therefore the Company acknowledges the advance of funds to US B by Mr. Salerno, however the terms of the advance and the default penalty have not been accepted and are subject to negotiation or dispute. As of December 31, 2022, these notes remain outstanding, interest has been accrued on these notes, however we intend to dispute the validity of these notes and have accordingly not repaid them or accrued penalty interest in terms of these notes. The movement on promissory notes payable - Related PartyParties, consists of the following: December 31, 2022 December 31, 2021 Principal outstanding Opening balance $ 50,000 $ — Promissory note payable on acquisition of US Bookmaking — 50,000 Loans advanced – Braydon Capital Corp 360,000 — Loans advanced – Victor Salerno 305,000 — Closing balance 715,000 50,000 Accrued Interest Opening balance 1,878 — Accrued interest 35,122 1,878 Closing balance 37,000 1,878 Total $ 752,000 $ 51,878 Related Party (Payables) Receivables Related party payables and receivables represent non-interest-bearing (payables) receivables that are due on demand. The balances outstanding are as follows: Related Party Receivables December 31, 2022 December 31, 2021 Related Party payable Related Party payables Engage IT, srl. $ (406,467 ) $ — Related Party payables Luca Pasquini (459 ) (502 ) Related Party payables Michele Ciavarella (15,203 ) — Related Party payables $ (422,129 ) $ (502 ) Related Party Receivable Related Party Receivables Victor Salerno $ 22,511 $ — Related Party Receivables Luca Pasquini — 1,413 Related Party Receivables $ 22,511 $ 1,413 Engage IT srl. The Company acquired Engage with effect from January 29, 2023. Engage performed software development work for the Company's wholly owned subsidiary, Gameboard. As of December 31, 2022, Gameboard owed Engage $406,467 for development work performed. Luca Pasquini On January 31, 2019, the Company acquired Virtual Generation for € 4,000,000 4,576,352 Company, 800,000 915,270 800,000 500,000 300,000 500,000 604,380 112,521 300,000 $334,791 On January 22, 2021, the Company issued Mr. Pasquini 44,968 $ 257,217 On July 11, 2021, the Company entered into an agreement with Engage IT Services Srl.("Engage"), to provide gaming software and maintenance and support of the system, the total contract price was €390,000 $459,572 €1,980,000 $2,192,000 34% On September 13, 2021, Mr. Pasquini, the Company’s Vice President of Technology, resigned as a director of the Company and on October 4, 2021, Mr. Pasquini became the Global Head of Engineering of the Company’s subsidiary Odissea Betriebsinformatik Beratung GmbH and ceased to be Vice President of Technology and an executive officer of the Company. On September 26, 2022, Mr. Pasquini was awarded 500,000 $226,800 Michele Ciavarella Mr. Ciavarella, the Company’s Executive Chairman of the Board, agreed to receive $ 140,000 24,476 On January 22, 2021, the Company issued Mr. Ciavarella 175,396 1,003,265 On July 15, 2021, Mr. Ciavarella, Executive Chairman of the Company, was appointed as the interim Chief Executive Officer and President of the Company, effective July 15, 2021. Mr. Ciavarella will serve as the Company’s Executive Chairman and interim Chief Executive Officer until the earlier of his resignation or removal from office. Mr. Ciavarella agreed to receive his 2021 bonus and a portion of his 2022 salary as a restricted stock award. On January 7, 2022, the Company issued Mr. Ciavarella 162,835 425,000 On September 26, 2022, Mr. Ciavarella was awarded 300,000 136,080 Carlo Reali On January 5, 2022, the Company promoted Carlo Reali to the role of Interim Chief Financial Officer. On March 29, 2022, the Company issued Mr. Reali ten-year options exercisable for 100,000 2.50 The Company does not have a formal employment with Mr. Reali and awarded him € 40,000 42,930 76,632 82,244 On September 26, 2022, Mr. Reali was awarded 200,000 90,720 Victor Salerno On July 15, 2021 the Company consummated the acquisition of US B and in terms of the Purchase Agreement the Company acquired 100% of US B , from its members (the “Sellers”). Mr. Salerno was a 68% owner of US B and received $4,080,000 of the $ 6,000,000 paid in cash upon closing and 860,760 of the 1,265,823 shares of common stock issued on closing. Together with the consummation of the acquisition of US B , the Company entered into a 4 year employment agreement with Mr. Salerno terminating on July 14, 2025 (the “Salerno Employment Agreement”), automatically renewable for a period of one year unless notified by either party of non-renewal. The employee will earn an initial base salary of $0 and thereafter $150,000 Mr. Salerno may be terminated for no cause or resign for good reason, which termination would entitle him to the greater of one year’s salary or the remaining term of the employment agreement plus the highest annual incentive bonus paid to him during the past two years. If Mr. Salerno is terminated for cause he is entitled to all unpaid salary and expenses due to him at the time of termination. If the employment agreement is terminated due to death, his heirs and successors are entitled to all unpaid salary, unpaid expenses and one times his annual base salary. Termination due to disability will result in Mr. Salerno being paid all unpaid salary and expenses and one times annual salary. Pursuant to the Salerno Employment Agreement, Mr. Salerno has also agreed to customary restrictions with respect to the disclosure and use of the Company’s confidential information and has agreed that work product or inventions developed or conceived by him while employed with the Company relating to its business is the Company’s property. In addition, during the term of his employment and if terminated for cause for the 12 month period following his termination of employment, Mr. Salerno has agreed not to (1) perform services on behalf of a competing business which was the same or similar to the type of services he was authorized, conducted, offered or provided to the Company, (2) solicit or induce any of the Company’s employees or independent contractors to terminate their employment with the Company, (3) solicit any actual or prospective customers with whom he had material contact on behalf of a competing business or (4) solicit any actual or prospective vendors with whom he had material contact to support a competing business. On September 13, 2021, the Board appointed Mr. Salerno, the President and founder of the Company’s newly acquired subsidiary, US B , to serve as a member of the Board. On January 23, 2023, Mr. Salerno voluntary resigned as a member of the Board. Paul Sallwasser On September 13, 2021, the Company granted Mr. Sallwasser ten year options exercisable for 21,300 5.10 Steven Shallcross On January 22, 2021, the Company issued to Mr. Shallcross, a director of the Company, 5,245 30,000 On September 13, 2021, the Company granted Mr. Shallcross ten year options exercisable for 13,600 5.10 Andrea Mandel-Mantello On June 29, 2021, the board of directors of the Company appointed Mr. Mandel-Mantello to serve as a member of the Board. The appointment was effective immediately. Mr. Mandel-Mantello serves on the audit committee of the Board. On September 13, 2021, the Company granted Mr. Mandel-Montello ten year options exercisable for 13,600 5.10 Aiden Ciavarella The Company recently employed Aiden Ciavarella to train as part of our U.S. risk management team. Aiden earns an annual salary of $75,000 |
15. Stockholders_ Equity
15. Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
15. Stockholders’ Equity | 15. Stockholders’ Equity On January 7, 2022, the Company issued a total of 162,835 $425,000 Between March 28, 2022 and April 13, 2022, the Company sold 168,016 387,053 $11,612 SM On June 10, 2022, the Company entered into an engagement letter (the “Engagement Letter”), with H.C. Wainwright & Co., LLC (the “Placement Agent”), pursuant to which the Placement Agent agreed to serve as the exclusive placement agent for the Company, on a reasonable best efforts basis, in connection with an offering of securities (the “Offering”). The Company agreed to pay the Placement Agent an aggregate cash fee equal to 6.0% of the gross proceeds received in the Offering. The Company also agreed to pay the Placement Agent $ 50,000 $15,950 On June 13, 2022, the Company, entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Investor”) providing for the issuance of (i) 2,625,000 541,227 $0.0001 3,166,227 $0.9475 The shares of Common Stock, the Pre-Funded Warrants, the Pre-Funded Warrant Shares and the Warrants are collectively referred to as the “Securities.” Pursuant to the Purchase Agreement, the Investor agreed to purchase the Securities for an aggregate purchase price of $3 3,000,000 Pursuant to the Purchase Agreement, on June 15, 2022, an aggregate of 2,625,000 Shares and Pre-Funded Warrants to purchase 541,227 shares of Common Stock were issued to an Investor in a registered direct offering (the “Registered Offering”) and registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to a prospectus supplement to the Company’s currently effective registration statement on Form S-3 (File No. 333-256815), which was initially filed with the U.S. Securities and Exchange Commission (the “SEC”) on June 4, 2021, and was declared effective on June 14, 2021. The Company filed the prospectus supplement for the Registered Offering on June 15, 2022. Pursuant to the Purchase Agreement, the Company issued a Warrant exercisable for 3,166,227 shares of common stock, exercisable at $0.9475 per share and expires on December 15, 2027, to the Investor in a concurrent private placement pursuant to an exemption from the registration requirements of the Securities Act provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder. On July 12, 2022, the pre-funded warrant disclosed in note 16 below for 541,227 shares of common stock was exercised at an exercise price of $0.0001 per share for gross proceeds of $54.12. On September 14, 2022, the Company filed a registration statement (the “Registration Statement”) to register the resale of the Warrant Shares within 90 days of the date of the Purchase Agreement which was declared effective on September 16, 2022. On September 26, 2022, the compensation committee awarded a total of 3,500,000 1,587,600 300,000 136,080 200,000 90,720 |
16. Warrants
16. Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Warrants | |
16. Warrants | 16. Warrants In terms of the Purchase Agreement discussed in note 15 above, on June 15, 2022, the Company issued, (i) Pre-Funded Warrants to purchase 541,227 shares of Common Stock with an exercise price of $0.0001 per share, which Pre-Funded Warrants were issued in lieu of shares of Common Stock to ensure that the Investor did not exceed certain beneficial ownership limitations, and (ii) Warrants to purchase 3,166,227 shares of Common Stock, with an exercise price of $0.9475 per share, subject to customary adjustments thereunder. If after the six month anniversary of the issuance date there is no effective registration statement registering the Warrant Shares for resale, then the Warrants are exercisable on a cashless basis. Each Pre-Funded Warrant was exercisable for one share of Common Stock at an exercise price of $0.0001 per share. The Pre-Funded Warrants were immediately exercisable and could be exercised at any time after their original issuance until all of the Pre-Funded Warrants were exercised in full. On July 12, 2022, the pre-funded warrant disclosed in note 15 above for 541,227 shares of common stock was exercised at an exercise price of $0.0001 per share for gross proceeds of $54.12. On September 14, 2022, the Company filed a registration statement (the “Registration Statement”) to register the resale of the Warrant Shares within 90 days of the date of the Purchase Agreement which was declared effective on September 16, 2022. Each Warrant is exercisable for one share of Common Stock at an exercise price of $0.9475 per share, subject to customary adjustments thereunder. The Warrants have a term of five years and six months, maturing on December 15, 2027 and are exercisable from December 15, 2022. A holder (together with its affiliates) of the Pre-Funded Warrant or Warrant may not exercise any portion of the Common Stock underlying the Pre-Funded Warrant or Warrant, as applicable, to the extent that the holder would own more than 4.99% (or, at the holder’s option upon issuance, 9.99%) of the Company’s outstanding Common Stock immediately after exercise, as such percentage ownership is determined in accordance with the terms of the Pre-Funded Warrant or Warrant, as applicable. In lieu of making the cash payment otherwise contemplated to be made to the Company upon exercise of a Pre-Funded Warrant or Warrant in payment of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either in whole or in part) the net number of shares of Common Stock determined according to a formula set forth in Warrants, provided that such cashless exercise shall only be permitted if the Registration Statement is not effective at the time of such exercise or if the prospectus to which the Registration Statement is a part is not available for the issuance of shares of Common Stock to the Warrant holder. In addition, in certain circumstances, upon a Fundamental Transaction, the holders of the Pre-Funded Warrants and Warrants will have the right to receive as alternative consideration, for each share of Common Stock that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, the number of shares of Common Stock of the successor or acquiring corporation of the Company, if it is the surviving corporation, and any additional consideration receivable upon or as a result of such transaction by a holder of the number of shares of Common Stock for which the Pre-Funded Warrants or Warrants are exercisable immediately prior to such event. Notwithstanding the foregoing, in the event of a Fundamental Transaction, the holders of the Warrants have the right to require the Company or a successor entity to redeem the Warrants for an amount of consideration equal to the Black Scholes Value (as defined in the Warrants) of the remaining unexercised portion of the Warrants concurrently with or within thirty (30) days following the consummation of a Fundamental Transaction. In the event of a Fundamental Transaction, the holders of the Warrants will only be entitled to receive from the Company or its successor entity, as of the date of consummation of such Fundamental Transaction the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of the Warrant, that is being offered and paid to the holders of the Common Stock in connection with the Fundamental Transaction, whether that consideration is in the form of cash, stock or any combination of cash and stock, or whether the holders of common Stock are given the choice to receive alternative forms of consideration in connection with the Fundamental Transaction. A summary of all of the Company’s warrant activity during the period January 1, 2021 to December 31, 2022 is as follows: Warrants Number of shares Exercise price per share Weighted average exercise price Warrants: Number of Shares Warrants: Exercise price per share Warrants: Weighted average exercise price Outstanding January 1, 2021 2,053,145 $ 2.50 to 5.00 $ 2.63 Granted — — — Forfeited/cancelled — — — Exercised (1,506,809 ) 2.50 to 5.00 2.63 Outstanding December 31, 2021 546,336 $ 2.50 to 5.00 $ 2.66 Granted – pre-funded warrants* 541,227 0.0001 0.0001 Granted 3,166,227 0.9475 0.9475 Forfeited/cancelled (48,395 ) 3.75 3.75 Exercised – pre-funded warrants* (541,227 0.0001 0.0001 Outstanding September 30, 2022 3,664,168 $ 0.9475 to 5.00 $ 1.17 The following tables summarize information about warrants outstanding as of December 31, 2022: Warrants outstanding, Exercise Price Warrants outstanding Warrants exercisable Exercise price Number of shares Weighted average remaining years Weighted average exercise price Number of shares Weighted average exercise price $0.9475 3,166,227 4.96 $ 3,166,227 $ $2.50 486,173 2.63 $ 486,173 $ $5.00 11,768 0.41 11,768 3,664,168 4.64 $ 1.17 3,664,168 $ 1.17 The outstanding warrants have an intrinsic value of $0 as of December 31, 2022. |
17. Stock Options
17. Stock Options | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
17. Stock Options | 17. Stock Options In September 2018, the Company’s stockholders approved our 2018 Equity Incentive Plan, which provides for a maximum of 1,150,000 On October 1, 2020, the Board approved an amendment to the Company’s 2018 Equity Incentive Plan (the “Plan”) to increase the maximum number of shares that may be granted as an award under the Plan to any non-employee director during any one calendar year to: (i) chairperson or lead director 300,000 shares of common stock; and (ii) other non-employee director 250,000 shares of common stock, which reflects an increase in the annual limits for awards to be granted to non-employee directors under the Plan. On November 20, 2020, the Company held its 2020 Annual Meeting of Stockholders. At the 2020 Annual Meeting, the Company’s stockholders approved an amendment to the Company’s 2018 Equity Incentive Plan to increase the number of shares of common stock that the Company will have authority to grant under the plan by an additional 1,850,000 On December 8, 2021, the Company held its 2021 Annual Meeting of Stockholders. At the 2021 Annual Meeting, the Company’s stockholders approved an amendment to the Company’s 2018 Equity Incentive Plan to increase the number of shares of common stock that the Company will have authority to grant under the plan by an additional 4,000,000 On November 21, 2022, the Board approved an Amendment to the Plan (“Amendment No. 3”) to increase by 9,000,000 7,000,000 16,000,000 On December 30, 2022, the Company held its 2022 Annual Meeting of Stockholders. At the Annual Meeting, the Company’s stockholders approved amendment 3 to the Company’s 2018 Equity Incentive Plan to increase the number of shares of common stock that the Company will have authority to grant under the plan by an additional 9,000,000 shares of common stock. . On March 29, 2022, the Company issued ten year options to purchase 160,000 $2.50 100,000 60,000 On September 25, 2022, the Company issued ten year options to purchase 110,000 $0.454 The options awarded during the year ended December 31, 2022 were valued at an average of $1.67 The following assumptions were used in the Black-Scholes model: Year ended December 31, 2022 Exercise price $ 0.454 to 2.50 Risk free interest rate 2.41 to 3.69 % Expected life of options 10 Expected volatility of underlying stock 204.2 to 205.3 % Expected dividend rate 0 % A summary of all of the Company’s option activity during the period January 1, 2021 to December 31, 2022 is as follows: Stock Option Activity Number of shares Exercise price per share Weighted average exercise price Stock Option Activity Exercise price per share Weighted Average exercise price Outstanding January 1, 2021 1,622,938 $ 1.84 to 2.96 $ 2.11 Granted 1,193,500 2.62 to 5.10 3.15 Forfeited/cancelled (50,000 ) 2.62 2.62 Exercised — — — Expired — — — Outstanding December 31, 2021 2,766,438 $ 1.84 to 5.10 $ 2.92 Granted 270,000 0.454 to 2.50 1.67 Forfeited/cancelled (652,375 ) 1.84 to 2.80 1.85 Exercised — — — Outstanding December 31, 2022 2,384,063 $ 0.454 to 5.10 $ 3.07 The following tables summarize information about stock options outstanding as of December 31, 2022: Stock Options Outstanding Options outstanding Options exercisable Exercise price Number of shares Weighted average remaining years Weighted average exercise price Number of shares Weighted average exercise price $0.45 110,000 9.74 — $2.03 659,000 7.75 530,500 $2.50 160,000 9.25 — $2.72 25,000 3.50 25,000 $2.80 216,250 6.73 176,068 $2.96 70,313 6.52 70,313 $3.43 25,000 8.97 9,000 $4.03 1,020,000 8.51 410,000 $4.07 25,000 8.54 9,000 $4.20 25,000 8.34 9,000 $5.10 48,500 8.71 48,500 2,384,063 8.14 $ 3.07 1,287,381 $ 2.99 As of December 31, 2022, there were unvested options to purchase 1,096,682 3,127,467 As of December 31, 2022, there was an aggregate of 2,384,063 4,155,301 9,460,636 The options outstanding at December 31, 2022 had an intrinsic value of $ 0 |
18. Revenues
18. Revenues | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
18. Revenues | 18. Revenues The following table represents disaggregated revenues from our gaming operations for the years ended December 31, 2022 and 2021. Net Gaming Revenues represents Turnover (also referred to as “Handle”), the total bets processed for the period, less customer winnings paid out, commissions paid to agents, and taxes due to government authorities, while Commission Revenues represents commissions on lotto ticket sales and Service Revenues is revenue invoiced for our Elys software service and royalties invoiced for the sale of virtual products. For the Year Ended December 31, 2022 2021 Handle (Turnover) Handle web-based $ 755,248,396 $ 826,789,619 Handle land-based 14,907,168 15,071,218 Total Handle (Turnover) 770,155,564 841,860,837 Winnings/Payouts Winnings web-based 704,932,499 771,852,252 Winnings land-based 12,355,575 12,842,577 Total Winnings/Payouts 717,288,074 784,694,829 Gross Gaming Revenues 52,867,490 57,166,008 Less: ADM Gaming Taxes 12,787,700 12,657,930 Net Gaming Revenues 40,079,790 44,508,078 Betting platform software and services 2,598,869 1,038,713 Revenues $ 42,678,659 $ 45,546,791 |
19. Net Loss per Common Share
19. Net Loss per Common Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
19. Net Loss per Common Share | 19. Net Loss per Common Share Basic loss per share is based on the weighted-average number of common shares outstanding during each year. Diluted loss per share is based on basic shares as determined above, plus the incremental shares that would be issued upon the assumed exercise of “in-the-money” warrants using the treasury stock method and the inclusion of all convertible securities, including convertible debentures, assuming these securities were converted at the beginning of the period or at the time of issuance, if later. The computation of diluted net loss per share does not assume the issuance of common shares that have an anti-dilutive effect on net loss per share. For the years ended December 31, 2022 and 2021, the following options, warrants and convertible debentures were excluded from the computation of diluted loss per share as the result of the computation was anti-dilutive: Description Year ended December 31, 2022 Year ended December 31, 2021 Options 2,384,063 2,766,438 Warrants 3,664,168 546,336 6,048,231 3,312,774 |
20. Income Taxes
20. Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
20. Income Taxes | 20. Income Taxes The Company is incorporated in the United States of America and is subject to United States federal taxation. No provisions for income taxes have been made as the Company had no U.S. taxable income for the years ended December 31, 2022 and December 31, 2021. The Company's Italian subsidiaries are governed by the income tax laws of Italy. The corporate tax rate in Italy is 27.9 The Company's Austrian subsidiaries are governed by the income tax laws of Austria. The corporate tax rate in Austria is 25 The Company's Canadian subsidiary is governed by the income tax laws of Canada and the Province of Ontario. The combined Federal and Provincial corporate tax rate in Canada is 26.5% The Company's Colombian subsidiary is governed by the income tax laws of Colombia. The corporate tax rate in Colombia is 35 The Company continues to evaluate the accounting for uncertainty in tax positions at the end of each reporting period. The guidance requires companies to recognize in their financial statements the impact of a tax position if the position is more likely than not of being sustained if the position were to be challenged by a taxing authority. The position ascertained inherently requires judgment and estimates by management. During the current year, the Italian Court of reggio Emilia purported to open an investigation against Ulisse for failure to disclose the opening of a permanent establishment in Italy which could potentially have subject Ulisse to Italian tax laws and not complying with national gaming regulations. Ulisse's attorneys file a motion to dismiss the case which was granted in November 2022. the Company considers the issue of permanent establishment as complex to prove as the scope of our operations is not ambiguous, Ulisse was a European operator with a valid Austrian license, acting according to the laws of Austria. No futher enquiries concerning Ulisse have been made to date by any government agencies. The reconciliation of income tax expense at the U.S. statutory rate of 21 December 31, 2022 December 31, 2021 U.S. Statutory rate $ 4,132,475 $ 3,224,547 Items not allowed for tax purposes (1,421,480 ) (1,705,372 ) Foreign tax rate differential 8,523 (2,367 ) Additional foreign taxation (24,805 ) 27,495 Prior year over provision 7,637 125,887 Movement in valuation allowances (1,282,115 ) (1,379,714 ) Income tax benefit $ 1,420,235 $ 290,476 The Company has accumulated a net operating loss carry forward (“NOL”) of approximately $ 32.4 million 0.1 million 11.1 million Utilization of NOLs are subject to limitation due to any ownership change (as defined under Section 382 of the Internal Revenue Code of 1986) which resulted in a change in business direction. Unused limitations may be carried over to future years until the NOLs expire. Utilization of NOLs may also be limited in any one year by alternative minimum tax rules. Under Italian tax law, the operating loss carryforwards available for offset against future profits can be used indefinitely. Operating loss carryforwards are only available for offset against national income tax, up to the limit of 80% of taxable annual income. This restriction does not apply to the operating loss incurred in the first three years of the Company's activity, which are therefore available for 100% offsetting. Under Austrian tax law, the operating loss carryforwards available for offset against future profits can be used indefinitely. Operating loss carryforwards are only available for offset against national income tax, up to the limit of 75% of taxable annual income. Under Canadian tax law, the operating loss carryforwards available for offset against future profits can be used indefinitely. The provisions for income taxes consist of currently payable income tax in Colombia, Italy, Malta and Austria and deferred tax movements on intangible assets. The deferred tax movement includes a reversal of an imputed deferred tax provision raised on the US Bookmaking intangible assets acquired. During the current period, the US Bookmaking intangible assets were amortized by $1,070,067 and further impaired by $6,081,833, resulting in. a release of the deferred tax provision of $1,501,899. The balance of the deferred tax credit of $93,441 related to imputed deferred tax on the amortization of long lived assets on the acquisition of Virtual Generation. The benefit (provision) for income taxes are summarized as follows: December 31, 2022 December 31, 2021 Current $ (175,105 ) $ 94,041 Withholding tax — Deferred 1,595,340 196,434 Income tax benefit $ 1,420,235 $ 290,476 The tax effects of temporary differences that give rise to the Company’s net deferred tax assets and liabilities are as follows: December 31, 2022 December 31, 2021 Working capital movements $ 496,910 $ 247,563 Property and equipment (2,243 ) — Net loss carryforward – Foreign 416,728 443,100 Net loss carryforward – US 6,806,054 5,815,807 7,717,449 6,506,470 Less valuation allowance (7,717,449 ) (6,506,470 ) Deferred tax assets — — Intangible assets (1,696,638 ) (3,291,978 ) Deferred Tax Liability $ ( 1,696,638 ) $ (3,291,978 ) The Net loss carry forward for US entities includes an adjustment of $ 0.1 million The following tax years remain subject to examination: USA: Generally three years from the date of tax return filing which is currently the 2019 to 2021 tax years. Italy: Generally five years from the date of filing which is currently the 2017 to 2021 tax years. Austria: Generally tax years 2020 and 2021. Malta: Eight years from fiscal year end which is currently 2014 to 2021. Colombia: Three years in the case of taxable profits and five years where taxable losses are realized. The Company is not currently under examination and it has not been notified of a pending examination. There are no unrecognized tax benefits. |
21. Segmental Reporting
21. Segmental Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
21. Segmental Reporting | 21. Segmental Reporting The Company has two reportable operating segments. These segments are: (i) Betting establishments The operating of web based as well as land-based leisure betting establishments situated throughout Italy. (ii) Betting platform software and services Provider of certified betting Platform software services to leisure betting establishments in Italy and 9 other countries. The operating assets and liabilities of the reportable segments are as follows: Segment Reporting December 31, 2022 Betting establishments Betting platform software and services All other Total Purchase of Non-Current assets $ 283,666 $ 2,547,189 $ 76,413 $ 2,907,268 Assets Current assets $ 4,982,712 $ 1,740,683 $ 101,817 $ 6,825,212 Non-Current assets 2,859,984 11,594,748 77,325 14,532,057 Liabilities Current liabilities (6,497,050 ) (2,649,357 ) (1,590,522 ) (10,736,929 ) Non-Current liabilities (1,560,355 ) (1,909,570 ) — (3,469,925 ) Intercompany balances 5,942,948 (4,027,794 ) (1,915,154 ) — Net asset position $ 5,728,239 $ 4,748,710 $ (3,326,534 ) $ 7,150,415 December 31, 2021 Betting establishments Betting platform software and services All other Total Purchase of Non-Current assets $ 135,272 $ 538,256 $ 43,552 $ 717,080 Assets Current assets $ 8,648,505 $ 1,291,700 $ 1,443,280 $ 11,383,485 Non-Current assets 1,980,100 31,203,882 11,374 33,195,356 Liabilities Current liabilities (7,610,577 ) (652,368 ) (1,564,234 ) (9,827,179 ) Non-Current liabilities (667,871 ) (16,342,274 ) - (17,010,145 ) Intercompany balances 4,359,786 (1,677,692 ) (2,682,094 ) — Net asset position $ 6,709,943 $ 13,823,248 $ (2,791,674 ) $ 17,741,517 The segment operating results of the reportable segments are disclosed as follows: Year ended December 31, 2022 Betting establishments Betting platform software and services All other Adjustments Total Net Gaming Revenue $ 40,079,790 $ — $ — $ — $ 40,079,790 Betting platform and services revenue 251,929 2,346,940 — — 2,598,869 Intercompany Service revenue 121,243 2,489,549 — (2,610,792 ) — 40,452,962 4,836,489 (2,610,792 ) 42,678,659 Operating expenses Intercompany service expense 2,489,549 65,539 55,704 (2,610,792 ) — Selling expenses 32,362,842 343,086 — — 32,705,928 General and administrative expenses 5,875,787 5,808,124 8,293,364 — 19,977,275 Depreciation and amortization 218,304 1,590,938 22,962 — 1,832,204 Impairment of intangibles and goodwill — 20,583,502 — — 20,583,502 40,946,482 28,391,189 8,372,030 (2,610,792 ) 75,098,909 Loss from operations (493,520 ) (23,554,700 ) (8,372,030 ) — (32,420,250 ) Other Income (expenses) Interest expense, net (1,065 ) (39,897 ) (2,637 ) — (43,599 ) Amortization of debt discount Change in fair value of contingent purchase consideration — — 12,859,399 — 12,859,399 Other income 22,043 2 — — 22,045 Other expense (90,858 ) (17,690 ) (108,548 ) Loss on marketable securities — — 12,500 — 12,500 Total other income (expenses) (69,880 ) (57,585 ) 12,869,262 — 12,741,797 Loss before Income Taxes (563,400 ) (23,612,285 ) 4,497,232 — (19,678,453 ) Income tax provision (141,479 ) 1,561,714 — — 1,420,235 Net Loss $ (704,879 ) $ (22,050,571 ) $ 4,497,232 $ — $ (18,258,218 ) The segment operating results of the reportable segments are disclosed as follows: Year ended December 31, 2021 Betting establishments Betting platform software and services All other Adjustments Total Net Gaming Revenue $ 44,508,078 $ — $ — $ — $ 44,508,078 Betting platform and services revenue 152,550 886,163 — — 1,038,713 Intercompany Service revenue 321,775 4,211,774 — (4,533,549 ) — 44,982,403 5,097,937 — (4,533,549 ) 45,546,791 Operating expenses Intercompany service expense 4,211,774 321,775 — (4,533,549 ) — Selling expenses 36,227,544 47,208 — — 36,274,752 General and administrative expenses 6,263,874 4,911,941 6,290,971 — 17,466,786 Depreciation and amortization 370,661 936,496 44,016 1,351,173 Impairment of license 4,827,914 12,522,714 — — 17,350,628 51,901,767 18,740,134 6,334,987 (4,533,549 ) 72,443,339 Loss from operations (6,919,364 ) (13,642,197 ) (6,334,987 ) — (26,896,548 ) Other Income (expenses) Interest expense, net (11,169 ) (4,662 ) (5,154 ) — (20,985 ) Amortization of debt discount — — (12,833 ) — (12,833 ) Change in fair value of contingent purchase consideration — 11,857,558 — — 11,857,558 Other income 217,251 2,560 7,977 — 227,788 Other expense (23,705 ) (26,262 ) — — (49,967 ) Loss on marketable securities — — (460,000 ) — (460,000 ) Total other income (expenses) 182,377 11,829,194 (470,010 ) — 11,541,561 Loss before Income Taxes (6,736,987 ) (1813,003 ) (6,804,997 ) — (15,354,987 ) Income tax provision 119,890 170,586 — — 290,476 Net Loss $ (6,617,097 ) $ (1,642,417 ) $ (6,804,997 ) $ — $ (15,064,511 ) |
22. Subsequent Events
22. Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
22. Subsequent Events | 22. Subsequent Events Departure of director On January 23, 2023, Victor Salerno provided notice of his decision to resign from the Board of Directors of the Company, effective immediately. Mr. Salerno’s resignation letter did not state any reason for the resignation. Convertible debenture funding On January 30, 2023 (the "Closing Date"), the Company closed a private placement offering of up to 2,000 Each Unit sold to Investors was sold at a per unit price of $1,000 and was comprised of (i) a 12% convertible debenture in the principal amount of $1,000 (the “Debentures”), and (ii) warrants to purchase shares of the Company’s common stock (the “Warrants”). The Investors purchased a total of 850 units and the Company issued Debentures for the total principal amount of $850,000 2,179,487 The Debentures mature three years from their date of issuance and bear interest at a rate of 12% per annum compounded annually and payable on the maturity date. Each Debenture is convertible, at the option of the holder, at any time, into such number of shares of common stock of the Company equal to the principal amount of the Debenture plus all accrued and unpaid interest at a price equal to the volume weighted average price per share (calculated to the nearest one-hundredth of one cent) of the Company’s common stock on the Nasdaq stock market for the period of twenty consecutive trading days beginning on the twenty-third trading day immediately preceding the Closing Date and concluding at the close of trading on the third trading day immediately preceding the Closing Date, subject to adjustment as provided in the Debenture, at any time up to the Maturity Date. The Debentures are initially convertible into 2,179,487 shares of common stock, subject to anti-dilution adjustment as provided in the Debentures. The holder is guaranteed to receive a minimum of five months of interest in the event of an early repayment (“Redemption”) by the Company. In addition, the Company may accelerate this right of conversion on at least ten (10) business days prior written notice to the Holder if there is an effective Registration Statement registering, or a current prospectus available for, the resale of the common shares issuable on the conversion and (i) the closing price of the Company’s common shares exceeds two hundred (200%) per cent of the Conversion Price for five (5) trading days in a thirty (30) day period or (ii) the Company wishes to redeem or pre-pay the Debentures prior to the Maturity Date. If at any time that the common shares issuable to the Investors on conversion of the Debenture in whole or in part would be free trading without resale restrictions or statutory hold periods, the Debenture is redeemable by the Company at any time or times prior to the Maturity Date on not less than ten (10) Business Days prior written notice from the Company to the Investor of the proposed date of Redemption (the “Redemption Date”), without bonus or penalty, provided, however, that prior to the Redemption Date, the Investor has the right to convert the whole or any part of the principal and accrued and unpaid interest of the Debenture into common shares of the Company. The warrants are exercisable at an exercise price equal to the volume weighted average price per share (calculated to the nearest one-hundredth of one cent) of the Company common stock on the Nasdaq stock market for the period of twenty consecutive trading days beginning on the twenty-third trading day immediately preceding the Closing Date and concluding at the close of trading on the third trading day immediately preceding the Closing Date, subject to adjustment as provided in the Warrant and expire three years after the issuance date. Each warrant is exercisable on a cashless basis in the event that there is not an effective registration statement registering the shares underlying the warrant at the time of exercise. The Company may accelerate the right to exercise the Warrant on at least ten (10) business days prior written notice to the Holder if there is an effective Registration Statement registering, or a current prospectus available for, the resale of the common shares issuable on exercise of the Warrant and the closing price of the Company’s common shares exceeds two hundred (200%) per cent of the Exercise Price for five (5) trading days in a thirty (30) day period. The Warrants and Debentures provide that if the Company issues or sells common stock of securities convertible or exercisable into common stock for a price lower than the exercise price of conversion price that the exercise price and conversion price will be reduced to such price, subject to a floor price of $0.35 and subject to certain exempt issuances set forth in the Debenture and Warrant. The number of shares of common stock that may be issued upon exercise of the Warrants and Debentures is subject to an Exchange Cap (as defined in the Debentures and Warrants) unless shareholder approval to exceed the Exchange Cap is approved. The parties agree to amend the Debentures and Warrants as necessary in order to comply with the requirements of the Nasdaq Capital Markets. Acquisition of Engage IT Services On January 29, 2023 (the “Closing Date”), the Company entered into a Share Purchase Agreement (the “Purchase Agreement”) to acquire 100% of Engage IT Services, S.r.l., a company organized under the laws of Italy (“Engage”), from its founding shareholders (the “Sellers”). The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, the Company will acquire all of the shares of Engage and Engage will become a wholly owned subsidiary of Elys (the “Proposed Transaction”). Founded in 2016 by the Company’s current Head of Global Technology, Luca Pasquini, along with Alessandro Alpi and Michael Denney, Engage employs 27 specialist technicians, developers and software engineers that specialize in the design, implementation and management of SQL databases, agile project management, and solutions based on the Microsoft cloud platform (Azure) and in the development of .NET applications. Since 2016, Engage has also provided contract services to the Company, playing a key role in the development of the Company’s Elys Gameboard sportsbook technology and Player Account Management Platform (PAM). Pursuant to the terms of the Purchase Agreement, on the Closing Date, the Company paid the “Dollar Equivalent” of €1,080,000 for all of the shares of Engage on a debt free basis, which amount may be increased or decreased based on the working capital surplus or deficit, and any indebtedness due to or from Engage by or from any one or more of the Sellers to be determined 10 days prior to June 30, 2023. The Company satisfied the payment by the issuance 3,018,462 shares of common stock (the “Exchange Shares”) equal to the “Dollar Equivalent” of the Purchase Price, calculated at the exchange rate at the time of closing, at a price equal to the volume weighted average price per share (calculated to the nearest one-hundredth of one cent) of the Company’s common stock for the twenty consecutive trading days beginning on the twenty-third trading day immediately preceding the Closing Date and concluding at the close of trading on the third trading day immediately preceding the Closing Date or US $0.39 per share, which may be adjusted for any stock split, reverse stock split, stock dividend, recapitalization, combination, exchange or similar event; or any subsequent equity sale or rights offering of Elys, and is subject to shareholder approval if required. Additionally, the Company may repurchase the Exchange Shares in cash in whole or in part at any time on or prior to June 30, 2023. The Purchase Agreement contains customary representations, warranties and covenants of Elys and the Sellers. Subject to certain customary limitations, the Sellers have agreed to indemnify Elys and its officers and directors against certain losses related to, among other things, breaches of the Sellers’ representations and warranties, certain specified liabilities and the failure to perform covenants or obligations under the Purchase Agreement. Restricted Stock awards On January 29, 2023, the Company issued 5,366,155 Directors and executive compensation On February 14, 2023, the Compensation Committee of the Company’s Board granted the Company’s non-executive directors, under the Company’s Stock Incentive Plan; (i) an award of 131,631 54,753 154,132 77,254 In addition, in lieu of $20,000 40,000 22,472 44,944 On February 14, 2023, Mr. Ciavarella, the Company’s Executive Chairman, voluntarily offered and agreed to reduce his annual base compensation to $372,000 Share Trading Services On February 14, 2023, the Company engaged Shareholder Intelligence Services, LLC (“ShareIntel”) to utilize their patented, proprietary service offerings to obtain share trading analytic metrics designed to determine if the Company has been the target of improper and potentially illegal trading activities, including illegal naked short selling, in an effort to allow the Company to better monitor trading activity, including potential violations of SEC Regulation SHO, which governs stock and option share locate, close out and fail to deliver requirements. The Company issued a warrant to purchase up to 200,000 Warrant is exercisable at a price of $0.89 per share and vests at a rate of 1,000 warrant shares for each reduction of 10,000 shares of Reduction in Imbalances (Shorts) The Company has evaluated subsequent events through the date the financial statements were issued, other than disclosed above, we did not identify any other subsequent events that would have required adjustment or disclosure in the financial statements. |
2. Accounting Policies and Es_2
2. Accounting Policies and Estimates (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The company previously had a secondary listing on the NEO exchange in Canada, which was terminated with effect from December 31, 2021. For the purposes of its previous listing in Canada, the Company is an “SEC Issuer” as defined under National Instrument 52-107 “Accounting Principles and Audit Standards” “Continuous Disclosure Obligations” |
Principles of consolidation | Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries, all of which are wholly-owned. All significant inter-company transactions are eliminated upon consolidation. All amounts referred to in the Notes to the consolidated financial statements are in United States Dollars ($) unless stated otherwise. |
Foreign operations | Foreign operations The Company translated the assets and liabilities of its foreign subsidiaries into US Dollars at the exchange rate in effect at year end and the results of operations and cash flows at the average rate throughout the year. The translation adjustments are recorded directly as a separate component of stockholders’ equity, while transaction gains (losses) are included in net income (loss). Revenues were generated in US Dollars, Euros and Colombian Pesos during the years presented. Gains and losses from foreign currency transactions are recognized in current operations. |
Business Combinations | Business Combinations The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods, using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. Actual results could differ from those estimates. These estimates and assumptions include valuing equity securities issued in share-based payment arrangements, determining the fair value of assets acquired, allocation of purchase price, impairment of long-lived intangible assets and goodwill, the collectability of receivables, leasing arrangements, convertible debentures, contingent purchase consideration, contingencies and the value of deferred taxes and related valuation allowances. Certain estimates, including evaluating the collectability of receivables and advances, could be affected by external conditions, including those unique to the Company’s industry and general economic conditions. It is possible that these external factors could have an effect on the Company’s estimates that could cause actual results to differ from the Company’s estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. |
Loss Contingencies | Loss Contingencies The Company may be subject to claims, suits, government investigations, and other proceedings involving competition and antitrust, intellectual property, privacy, indirect taxes, labor and employment, commercial disputes, content generated by our users, goods and services offered by advertisers or publishers using the Company’s website platforms, and other matters. Certain of these matters include speculative claims for substantial or indeterminate amounts of damages. The Company records a liability when it believes that it is both probable that a loss has been incurred, and the amount can be reasonably estimated. If the Company determines that a loss is possible, and a range of the loss can be reasonably estimated, it discloses the range of the possible loss in the Notes to the Consolidated Financial Statements. The Company evaluates, on a regular basis, developments in its legal matters that could affect the amount of liability that has been previously accrued, and the matters and related ranges of possible losses disclosed and makes adjustments and changes to our disclosures as appropriate. Significant judgment is required to determine both likelihood of there being and the estimated amount of a loss related to such matters. Until the final resolution of such matters, there may be an exposure to loss in excess of the amount recorded, and such amounts could be material. Should any of the Company’s estimates and assumptions change or prove to have been incorrect, it could have a material impact on its business, consolidated financial position, results of operations, or cash flows. To date, none of these types of litigation matters, most of which are typically covered by insurance, has had a material impact on the Company’s operations or financial condition. The Company has insured and continues to insure against most of these types of claims. |
Fair Value Measurements | Fair Value Measurements ASC Topic 820, Fair Value Measurement and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This topic also establishes a fair value hierarchy which requires classification based on observable and unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. The carrying value of the Company's accounts receivables, gaming accounts receivable, lines of credit - bank, accounts payable, gaming accounts payable and bank loans payable approximate fair value because of the short-term maturity of these financial instruments. |
Derivative Financial Instruments | Derivative Financial Instruments ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirements of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as described. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company primarily places cash balances in the U.S. with high-credit quality financial institutions located in the United States which are insured by the Federal Deposit Insurance Corporation up to a limit of $ 250,000 $100,000 €100,000 To date, the Company has not been exposed to the recent U.S. bank failures and we do not anticipate any adverse impact on the Company’s cash balances. |
Gaming Accounts Receivable | Gaming Accounts Receivable Gaming accounts receivable represent gaming deposits made by customers to their online gaming accounts either directly by credit card, bank wire, e-wallet or other accepted method through one of our websites or indirectly by cash collected at the cashier of a betting shop but not yet credited to the Company’s bank accounts and subject to normal trade collection terms without discounts. The Company periodically evaluates the collectability of its gaming accounts receivable and considers the need to record or adjust an allowance for doubtful accounts based upon historical collection experience and specific customer information. Actual amounts could vary from the recorded estimates. The Company does not require collateral to support customer receivables. The Company recorded a release from the bad debt provision of $ 13,051 $98,167 0 $0 |
Gaming Accounts Payable | Gaming Accounts Payable Gaming accounts payable represent customer balances, including winnings and deposits, that are held as credits in online gaming accounts and have not as of yet been used or withdrawn by the customers. Customers can request payment of winnings from the Company at any time and the payment to customers can be made through bank wire, credit card, or cash disbursement from one of our locations. Online gaming account credit balances are non-interest bearing. |
Long Lived Assets | Long Lived Assets The Company evaluates the carrying value of its long-lived assets for impairment by comparing the expected undiscounted future cash flows of the assets to the net book value of the assets when events or circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. If the expected undiscounted future cash flows are less than the net book value of the assets, the excess of the net book value over the estimated fair value will be charged to earnings. Fair value is based upon discounted cash flows of the assets at a rate deemed reasonable for the type of asset and prevailing market conditions, appraisals, and, if appropriate, current estimated net sales proceeds from pending offers. |
Property and Equipment | Property and Equipment Property and equipment is stated at acquisition cost less accumulated depreciation and adjustments for impairment losses. Expenditures are capitalized only when they increase the future economic benefits embodied in an item of property and equipment. All other expenditures are recognized as expenses in the statement of operations as incurred. Depreciation is charged on a straight-line basis over the estimated remaining useful lives of the individual assets. Amortization commences from the time an asset is put into operation. The range of the estimated useful lives is as follows: Plant and Equipment Useful lives Description Useful Life Leasehold improvements Life of the underlying lease Computer and office equipment 3 to 5 years Furniture and fittings 7 to 10 years Computer Software 3 to 5 years Vehicles 4 to 5 years |
Intangible Assets | Intangible Assets Intangible assets are stated at acquisition cost less accumulated amortization, if applicable, less any adjustments for impairment losses. Amortization is charged on a straight-line basis over the estimated remaining useful lives of the individual intangibles. Where intangibles are deemed to be impaired the Company recognizes an impairment loss measured as the difference between the estimated fair value of the intangible and its book value. The range of the estimated useful lives is as follows: Intangible Useful lives Description Useful Life (in years) Betting Platform Software 15 Multigioco and Rifa ADM Licenses 1.5 to 7 Location contracts 5 to 7 Customer relationships 10 to 18 Trademarks/Tradenames 10 to 14 Websites 5 Non-compete agreements 4 |
Goodwill | Goodwill The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. The Company annually assesses whether the carrying value of its reporting unit exceeds its fair value and, if necessary, records an impairment loss equal to any such excess. Each interim reporting period, the Company assesses whether events or circumstances have occurred which indicate that the carrying amount of the reporting unit exceeds its fair value. If the carrying amount of the reporting unit exceeds its fair value, an asset impairment charge will be recognized in an amount equal to that excess. In terms of ASC 350, the Company performed a qualitative assessment and based on the outcome of the qualitative assessment, performed a quantitative analysis on its goodwill as of December 31, 2022 and determined that an impairment of 14,501,669 |
Leases | Leases The Company accounts for leases in terms of ASC 842. In terms of ASC 842, the Company assesses whether any asset based leases entered into for periods longer than twelve months meet the definition of financial leases or operation leases, by evaluating the terms of the lease, including the following; the duration of the lease; the implied interest rate in the lease; the cash flows of the lease; and whether the Company intends to retain ownership of the asset at the end of the lease term. Leases which imply that the Company will retain ownership at the end of the lease term are classified as financial leases, are included in property and equipment with a corresponding financial liability raised at the date of lease inception. Interest incurred on financial leases are expensed using the effective interest rate method. Leases which imply that the Company will not acquire the asset at the end of the lease term are classified as operating leases, the Company’s right to use the asset is reflected as a non-current right of use asset with a corresponding operational lease liability raised at the date of lease inception. The right of use asset and the operational lease liability are amortized over the right of use period using the effective interest rate implied in the operating lease agreement. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity's financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has no material uncertain tax positions for any of the reporting periods presented. In Italy, tax years beginning 2017 forward, are open and subject to examination, while in Austria companies are open and subject to inspection for five years and ten years for inspection of serious infractions. In the United States and Canada, tax years beginning 2017 forward, are subject to examination. The Company is not currently under examination and it has not been notified of a pending examination. |
Contingent Purchase Consideration | Contingent Purchase Consideration The Company estimates and records the acquisition date estimated fair value of contingent consideration as part of the purchase price consideration for acquisitions. At each reporting period, the Company estimates changes in the fair value of contingent consideration, and any change in fair value is recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss). An increase in the earn-out expected to be paid will result in a charge to operations in the year that the anticipated fair value of contingent consideration increases, while a decrease in the earn-out expected to be paid will result in a credit to operations in the year that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made regarding future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. Future revisions to these assumptions could materially change the estimate of the fair value of contingent consideration and therefore, materially affect the Company’s future financial results. Additional information regarding contingent consideration is provided in Note 4 and 12. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when control of its products and services is transferred to its customers in an amount that reflects the consideration the Company expects to receive from its customers in exchange for those products and services. Revenues from sports-betting, casino, cash and skill games, slots, bingo and horse race wagers represent the gross pay-ins (also referred to as turnover) from customers less gaming taxes and payouts to customers. Revenues are recorded when the game is closed which is representative of the point in time at which the Company has satisfied its performance obligation. In addition, the Company receives commissions from the sale of scratch tickets and other lottery games. Commissions are recorded when the ticket for scratch off tickets and lottery tickets are sold. Revenues from the Betting Platform include software licensing fees, training, installation, and product support services. The Company does not sell its proprietary software. Revenue is recognized when transfer of control to the customer has been made and the Company’s performance obligation has been fulfilled. • License fees are calculated as a percentage of each licensee’s level of activity and are contingent upon the licensee’s usage. The license fees are recognized on an accrual basis as earned. • Training fees, installation fees are recognized when each task has been completed. • Product support services are recognized based on the nature of the agreement with our customers, ad-hoc support service revenue will be recognized when the task is completed and revenue from product support service contracts will be recognized on a periodic basis where we charge a recurring fee to provide ongoing support services. |
Stock-Based Compensation | Stock-Based Compensation The Company records its compensation expense associated with stock options and other forms of equity compensation based on their fair value at the date of grant using the Black-Scholes option pricing model. Stock-based compensation includes amortization related to stock option awards based on the estimated grant date fair value. Stock-based compensation expense related to stock options is recognized ratably over the vesting period of the option. In addition, the Company records expense related to Restricted Stock Units (“RSU’s”) granted based on the fair value of those awards on the grant date. The fair value related to the RSUs is amortized to expense over the vesting term of those awards. Forfeitures of stock options and RSUs are recognized as they occur. Stock-based compensation expense for a stock-based award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, including foreign currency translation adjustments. |
Earnings Per Share | Earnings Per Share Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 260, “Earnings Per Share” provides for calculation of “basic” and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the dilutive impact on the number of shares outstanding should they be exercised. Securities that have the potential to dilute shareholder's interests include unexercised stock options and warrants as well as unconverted debentures. |
Related Parties | Related Parties Parties are considered to be related to the Company if the parties directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Financial Accounting Standards Board (“FASB”) issued additional updates during the year ended December 31, 2022. None of these standards are either applicable to the Company or require adoption at a future date and none are expected to have a material impact on the Company’s condensed consolidated financial statements upon adoption. |
Reporting by segment | Reporting by segment The Company has two operating segments from which it derives revenue. These segments are: (i) the operating of web based as well as land based leisure betting establishments situated throughout Italy, and (ii) provider of certified betting Platform software services to leisure betting establishments in Italy and 9 other countries. |
2. Accounting Policies and Es_3
2. Accounting Policies and Estimates (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Plant and Equipment Useful lives | Plant and Equipment Useful lives Description Useful Life Leasehold improvements Life of the underlying lease Computer and office equipment 3 to 5 years Furniture and fittings 7 to 10 years Computer Software 3 to 5 years Vehicles 4 to 5 years |
Intangible Useful lives | Intangible Useful lives Description Useful Life (in years) Betting Platform Software 15 Multigioco and Rifa ADM Licenses 1.5 to 7 Location contracts 5 to 7 Customer relationships 10 to 18 Trademarks/Tradenames 10 to 14 Websites 5 Non-compete agreements 4 |
4. Acquisition of subsidiaries
4. Acquisition of subsidiaries (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisition of subsidiaries | Amount Consideration Cash $ 6,000,000 1,265,823 shares of common stock at fair market value 4,554,304 Contingent purchase consideration 24,716,957 Total purchase consideration $ 35,261,261 Recognized amounts of identifiable assets acquired and liabilities assumed Cash 26,161 Other Current assets 151,284 Property and equipment 788 Other non-current assets 4,000 Tradenames/Trademarks 1,419,000 Customer relationships 7,275,000 Non-compete agreements 2,096,000 $ 10,972,233 Less: liabilities assumed Current liabilities assumed (264,135 ) Non-current liabilities assumed (205,320 ) Imputed Deferred taxation on identifiable intangible acquired (2,265,900 ) $ (2,735,355 ) Net identifiable assets acquired and liabilities assumed 8,236,878 Goodwill 27,024,383 Total purchase consideration $ 35,261,261 |
Acquisition Combined Earnings | Proforma Revenue and Earnings Revenue Earnings Actual for December 31, 2022 $ 1,105,986 $ (1,064,889) 2021 Supplemental pro forma from January 1, 2021 to December 31, 2021 $ 45,957,894 $ (15,887,232 ) |
6. Property and equipment (Tabl
6. Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Plant and equipment | December 31, 2022 December 31, 2021 Cost Accumulated depreciation Net book value Net book value Leasehold improvements $ 58,808 $ 40,932 $ 17,876 $ 27,260 Computer and office equipment 1,166,394 858,792 307,602 223,214 Fixtures and fittings 437,442 277,320 160,122 135,433 Vehicles 14,574 14,574 — 44,837 Computer software 336,455 211,203 125,252 59,335 $ 2,013,673 $ 1,402,821 $ 610,852 $ 490,079 |
7. Leases (Tables)
7. Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Right of use assets included in the consolidated balance sheet are as follows: | Right of use assets included in the consolidated balance sheet are as follows: December 31, 2022 December 31, 2021 Non-current assets Right of use assets - operating leases, net of amortization $ 1,498,703 $ 589,288 Right of use assets - finance leases, net of depreciation – included in property and equipment $ 8,884 $ 15,520 Lease costs consists of the following: Year ended December 31, 2022 2021 Finance lease cost: $ 8,005 $ 10,906 Amortization of right-of-use assets 7,536 10,102 Interest expense on lease liabilities 469 804 Operating lease cost 408,062 244,639 Total lease cost $ 416,067 $ 255,545 Other lease information: Year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ (469 ) $ (804 ) Operating cash flows from operating leases (408,062 ) (244,639 ) Financing cash flows from finance leases (7,809 ) (10,172 ) Right-of-use assets obtained in exchange for new finance leases 1,881 — Right-of-use assets disposed of under operating leases prior to lease maturity (61,769 ) (224,793 ) Right-of -use assets obtained in exchange for new operating leases $ 1,351,211 $ 406,276 Weighted average remaining lease term – finance leases 1.75 1.93 Weighted average remaining lease term – operating leases 4.06 2.60 Weighted average discount rate – finance leases 4.98 % 3.73 % Weighted average discount rate – operating leases 3.02 % 2.73 % |
Leases - Finance lease liability | Finance lease liability Amount 2023 $ 7,142 2024 1,260 2025 488 2026 488 2027 and thereafter 366 Total undiscounted minimum future lease payments 9,744 Imputed interest (625 ) Total finance lease liability $ 9,119 Disclosed as: Current portion $ 6,831 Non-Current portion 2,288 $ 9,119 |
Leases - Operating lease liability | Operating lease liability Amount 2023 $ 426,238 2024 356,755 2025 316,349 2026 279,540 2027 and thereafter 264,650 Total undiscounted minimum future lease payments 1,643,532 Imputed interest (116,510 ) Total operating lease liability $ 1,527,022 Disclosed as: Current portion $ 369,043 Non-Current portion 1,157,979 $ 1,527,022 |
8. Intangible Assets (Tables)
8. Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | December 31, 2022 December 31, 2021 Cost Impairment charge Accumulated amortization Net Net book Betting platform software $ 8,628,105 $ — $ (1,851,619 ) $ 6,776,486 $ 4,745,895 Licenses 973,333 — (961,469 ) 11,864 3,413 Location contracts 1,000,000 — (1,000,000 ) — — Customer relationships 8,145,927 (4,750,000 ) (1,072,022 ) 2,323,905 7,538,533 Trademarks 1,537,318 — (274,049 ) 1,263,269 1,413,887 Non-compete agreement 2,096,000 (1,331,833 ) (764,167 ) — 1,855,833 Websites 40,000 — (40,000 ) — — $ 22,420,683 $ (6,081,833 ) $ (5,963,326 ) $ 10,375,524 $ 15,557,561 |
Intangible Assets - Amortization Expense | Amortization Expense Amount 2023 $ 1,198,162 2024 1,193,704 2025 1,189,997 2026 1,188,997 2027 1,181,999 Total estimated amortization expense $ 5,953,859 |
9. Goodwill (Tables)
9. Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | December 31, 2022 December 31, 2021 Cost Opening balance as of January 1, $ 28,687,051 $ 1,663,120 Acquisition of US Bookmaking 27,024,383 Foreign exchange movements (390 ) (452 ) Closing balance as of December 31. 28,686,661 28,687,051 Accumulated Impairment charge Opening balance as of January 1, (12,522,714 ) — Impairment charge (14,501,669 ) (12,522,714) Closing balance as of December 31, (27,024,383 ) (12,522,714) Goodwill, net of impairment charges $ 1,662,278 $ 16,164,337 |
11. Bank Loan Payable (Tables)
11. Bank Loan Payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Federal Home Loan Banks [Abstract] | |
The maturity of bank loans payable as of December 31, 2022 is as follows: | The maturity of bank loans payable as of December 31, 2022 is as follows: Amount Within 1 year $ 3,151 1 to 2 years 3,272 2 to 3 years 3,396 3 to 4 years 3,526 5 years and thereafter 137,975 Total $ 151,320 Disclosed as: Current portion $ 3,151 Non-Current portion 148,169 $ 151,320 |
12. Contingent Purchase Consi_2
12. Contingent Purchase Consideration (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure 12.Contingent Purchase Consideration Abstract | |
Contigent Purchase Consideration | December 31, 2022 December 31, 2021 Opening balance $ 12,859,399 $ — Contingent purchase consideration measured on the acquisition of US Bookmaking — 24,716,957 Changes in fair value (12,859,399 ) (11,857,558 ) Closing balance $ - $ 12,859,399 |
13. Other Long-term Liabiliti_2
13. Other Long-term Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Other long-term liabilities | Other long-term liabilities December 31, 2022 December 31, 2021 Severance liability $ 464,851 $ 359,567 |
14. Related Parties (Tables)
14. Related Parties (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Equipment Loan - Related Party (Details Narrative) | December 31, 2022 December 31, 2021 Principal outstanding Opening balance $ 50,000 $ — Promissory note payable on acquisition of US Bookmaking — 50,000 Loans advanced – Braydon Capital Corp 360,000 — Loans advanced – Victor Salerno 305,000 — Closing balance 715,000 50,000 Accrued Interest Opening balance 1,878 — Accrued interest 35,122 1,878 Closing balance 37,000 1,878 Total $ 752,000 $ 51,878 |
Related Party Receivables | Related Party Receivables December 31, 2022 December 31, 2021 Related Party payable Related Party payables Engage IT, srl. $ (406,467 ) $ — Related Party payables Luca Pasquini (459 ) (502 ) Related Party payables Michele Ciavarella (15,203 ) — Related Party payables $ (422,129 ) $ (502 ) Related Party Receivable Related Party Receivables Victor Salerno $ 22,511 $ — Related Party Receivables Luca Pasquini — 1,413 Related Party Receivables $ 22,511 $ 1,413 |
16. Warrants (Tables)
16. Warrants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Warrants | |
Warrants | Warrants Number of shares Exercise price per share Weighted average exercise price Warrants: Number of Shares Warrants: Exercise price per share Warrants: Weighted average exercise price Outstanding January 1, 2021 2,053,145 $ 2.50 to 5.00 $ 2.63 Granted — — — Forfeited/cancelled — — — Exercised (1,506,809 ) 2.50 to 5.00 2.63 Outstanding December 31, 2021 546,336 $ 2.50 to 5.00 $ 2.66 Granted – pre-funded warrants* 541,227 0.0001 0.0001 Granted 3,166,227 0.9475 0.9475 Forfeited/cancelled (48,395 ) 3.75 3.75 Exercised – pre-funded warrants* (541,227 0.0001 0.0001 Outstanding September 30, 2022 3,664,168 $ 0.9475 to 5.00 $ 1.17 |
Warrants oustanding, exercise price (Details Narrative) | Warrants outstanding, Exercise Price Warrants outstanding Warrants exercisable Exercise price Number of shares Weighted average remaining years Weighted average exercise price Number of shares Weighted average exercise price $0.9475 3,166,227 4.96 $ 3,166,227 $ $2.50 486,173 2.63 $ 486,173 $ $5.00 11,768 0.41 11,768 3,664,168 4.64 $ 1.17 3,664,168 $ 1.17 |
17. Stock Options (Tables)
17. Stock Options (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock option Assumptions | Year ended December 31, 2022 Exercise price $ 0.454 to 2.50 Risk free interest rate 2.41 to 3.69 % Expected life of options 10 Expected volatility of underlying stock 204.2 to 205.3 % Expected dividend rate 0 % |
Stock Option Activity | Stock Option Activity Number of shares Exercise price per share Weighted average exercise price Stock Option Activity Exercise price per share Weighted Average exercise price Outstanding January 1, 2021 1,622,938 $ 1.84 to 2.96 $ 2.11 Granted 1,193,500 2.62 to 5.10 3.15 Forfeited/cancelled (50,000 ) 2.62 2.62 Exercised — — — Expired — — — Outstanding December 31, 2021 2,766,438 $ 1.84 to 5.10 $ 2.92 Granted 270,000 0.454 to 2.50 1.67 Forfeited/cancelled (652,375 ) 1.84 to 2.80 1.85 Exercised — — — Outstanding December 31, 2022 2,384,063 $ 0.454 to 5.10 $ 3.07 |
Stock Options - Stock options outstanding | Stock Options Outstanding Options outstanding Options exercisable Exercise price Number of shares Weighted average remaining years Weighted average exercise price Number of shares Weighted average exercise price $0.45 110,000 9.74 — $2.03 659,000 7.75 530,500 $2.50 160,000 9.25 — $2.72 25,000 3.50 25,000 $2.80 216,250 6.73 176,068 $2.96 70,313 6.52 70,313 $3.43 25,000 8.97 9,000 $4.03 1,020,000 8.51 410,000 $4.07 25,000 8.54 9,000 $4.20 25,000 8.34 9,000 $5.10 48,500 8.71 48,500 2,384,063 8.14 $ 3.07 1,287,381 $ 2.99 |
18. Revenues (Tables)
18. Revenues (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | For the Year Ended December 31, 2022 2021 Handle (Turnover) Handle web-based $ 755,248,396 $ 826,789,619 Handle land-based 14,907,168 15,071,218 Total Handle (Turnover) 770,155,564 841,860,837 Winnings/Payouts Winnings web-based 704,932,499 771,852,252 Winnings land-based 12,355,575 12,842,577 Total Winnings/Payouts 717,288,074 784,694,829 Gross Gaming Revenues 52,867,490 57,166,008 Less: ADM Gaming Taxes 12,787,700 12,657,930 Net Gaming Revenues 40,079,790 44,508,078 Betting platform software and services 2,598,869 1,038,713 Revenues $ 42,678,659 $ 45,546,791 |
19. Net Loss per Common Share (
19. Net Loss per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) per Common Share | Description Year ended December 31, 2022 Year ended December 31, 2021 Options 2,384,063 2,766,438 Warrants 3,664,168 546,336 6,048,231 3,312,774 |
20. Income Taxes (Tables)
20. Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes - Income tax expense | December 31, 2022 December 31, 2021 U.S. Statutory rate $ 4,132,475 $ 3,224,547 Items not allowed for tax purposes (1,421,480 ) (1,705,372 ) Foreign tax rate differential 8,523 (2,367 ) Additional foreign taxation (24,805 ) 27,495 Prior year over provision 7,637 125,887 Movement in valuation allowances (1,282,115 ) (1,379,714 ) Income tax benefit $ 1,420,235 $ 290,476 |
Income Taxes - Benefit (Provision) Income tax expense | December 31, 2022 December 31, 2021 Current $ (175,105 ) $ 94,041 Withholding tax — Deferred 1,595,340 196,434 Income tax benefit $ 1,420,235 $ 290,476 |
Income Taxes - Deferred tax assets and liabilities | December 31, 2022 December 31, 2021 Working capital movements $ 496,910 $ 247,563 Property and equipment (2,243 ) — Net loss carryforward – Foreign 416,728 443,100 Net loss carryforward – US 6,806,054 5,815,807 7,717,449 6,506,470 Less valuation allowance (7,717,449 ) (6,506,470 ) Deferred tax assets — — Intangible assets (1,696,638 ) (3,291,978 ) Deferred Tax Liability $ ( 1,696,638 ) $ (3,291,978 ) |
21. Segmental Reporting (Tables
21. Segmental Reporting (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting December 31, 2022 Betting establishments Betting platform software and services All other Total Purchase of Non-Current assets $ 283,666 $ 2,547,189 $ 76,413 $ 2,907,268 Assets Current assets $ 4,982,712 $ 1,740,683 $ 101,817 $ 6,825,212 Non-Current assets 2,859,984 11,594,748 77,325 14,532,057 Liabilities Current liabilities (6,497,050 ) (2,649,357 ) (1,590,522 ) (10,736,929 ) Non-Current liabilities (1,560,355 ) (1,909,570 ) — (3,469,925 ) Intercompany balances 5,942,948 (4,027,794 ) (1,915,154 ) — Net asset position $ 5,728,239 $ 4,748,710 $ (3,326,534 ) $ 7,150,415 December 31, 2021 Betting establishments Betting platform software and services All other Total Purchase of Non-Current assets $ 135,272 $ 538,256 $ 43,552 $ 717,080 Assets Current assets $ 8,648,505 $ 1,291,700 $ 1,443,280 $ 11,383,485 Non-Current assets 1,980,100 31,203,882 11,374 33,195,356 Liabilities Current liabilities (7,610,577 ) (652,368 ) (1,564,234 ) (9,827,179 ) Non-Current liabilities (667,871 ) (16,342,274 ) - (17,010,145 ) Intercompany balances 4,359,786 (1,677,692 ) (2,682,094 ) — Net asset position $ 6,709,943 $ 13,823,248 $ (2,791,674 ) $ 17,741,517 The segment operating results of the reportable segments are disclosed as follows: Year ended December 31, 2022 Betting establishments Betting platform software and services All other Adjustments Total Net Gaming Revenue $ 40,079,790 $ — $ — $ — $ 40,079,790 Betting platform and services revenue 251,929 2,346,940 — — 2,598,869 Intercompany Service revenue 121,243 2,489,549 — (2,610,792 ) — 40,452,962 4,836,489 (2,610,792 ) 42,678,659 Operating expenses Intercompany service expense 2,489,549 65,539 55,704 (2,610,792 ) — Selling expenses 32,362,842 343,086 — — 32,705,928 General and administrative expenses 5,875,787 5,808,124 8,293,364 — 19,977,275 Depreciation and amortization 218,304 1,590,938 22,962 — 1,832,204 Impairment of intangibles and goodwill — 20,583,502 — — 20,583,502 40,946,482 28,391,189 8,372,030 (2,610,792 ) 75,098,909 Loss from operations (493,520 ) (23,554,700 ) (8,372,030 ) — (32,420,250 ) Other Income (expenses) Interest expense, net (1,065 ) (39,897 ) (2,637 ) — (43,599 ) Amortization of debt discount Change in fair value of contingent purchase consideration — — 12,859,399 — 12,859,399 Other income 22,043 2 — — 22,045 Other expense (90,858 ) (17,690 ) (108,548 ) Loss on marketable securities — — 12,500 — 12,500 Total other income (expenses) (69,880 ) (57,585 ) 12,869,262 — 12,741,797 Loss before Income Taxes (563,400 ) (23,612,285 ) 4,497,232 — (19,678,453 ) Income tax provision (141,479 ) 1,561,714 — — 1,420,235 Net Loss $ (704,879 ) $ (22,050,571 ) $ 4,497,232 $ — $ (18,258,218 ) The segment operating results of the reportable segments are disclosed as follows: Year ended December 31, 2021 Betting establishments Betting platform software and services All other Adjustments Total Net Gaming Revenue $ 44,508,078 $ — $ — $ — $ 44,508,078 Betting platform and services revenue 152,550 886,163 — — 1,038,713 Intercompany Service revenue 321,775 4,211,774 — (4,533,549 ) — 44,982,403 5,097,937 — (4,533,549 ) 45,546,791 Operating expenses Intercompany service expense 4,211,774 321,775 — (4,533,549 ) — Selling expenses 36,227,544 47,208 — — 36,274,752 General and administrative expenses 6,263,874 4,911,941 6,290,971 — 17,466,786 Depreciation and amortization 370,661 936,496 44,016 1,351,173 Impairment of license 4,827,914 12,522,714 — — 17,350,628 51,901,767 18,740,134 6,334,987 (4,533,549 ) 72,443,339 Loss from operations (6,919,364 ) (13,642,197 ) (6,334,987 ) — (26,896,548 ) Other Income (expenses) Interest expense, net (11,169 ) (4,662 ) (5,154 ) — (20,985 ) Amortization of debt discount — — (12,833 ) — (12,833 ) Change in fair value of contingent purchase consideration — 11,857,558 — — 11,857,558 Other income 217,251 2,560 7,977 — 227,788 Other expense (23,705 ) (26,262 ) — — (49,967 ) Loss on marketable securities — — (460,000 ) — (460,000 ) Total other income (expenses) 182,377 11,829,194 (470,010 ) — 11,541,561 Loss before Income Taxes (6,736,987 ) (1813,003 ) (6,804,997 ) — (15,354,987 ) Income tax provision 119,890 170,586 — — 290,476 Net Loss $ (6,617,097 ) $ (1,642,417 ) $ (6,804,997 ) $ — $ (15,064,511 ) |
Plant and Equipment Useful live
Plant and Equipment Useful lives (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Office Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 3 years |
Office Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 5 years |
Fixtures and fittings | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 7 years |
Fixtures and fittings | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 10 years |
Computer Software, Intangible Asset [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 3 years |
Computer Software, Intangible Asset [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 5 years |
Vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 4 years |
Vehicles [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | 5 years |
Intangible Useful lives (Detail
Intangible Useful lives (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Intellectual Property [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 15 years | |
Licensing Agreements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 1 year 6 months | |
Licensing Agreements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 7 years | |
Contractual Rights [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 5 years | |
Contractual Rights [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 7 years | |
Customer Relationships [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 10 years | |
Customer Relationships [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 18 years | |
Trademarks [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 10 years | |
Trademarks [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 14 years | |
Websites | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 5 years | |
Noncompete Agreements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 4 years |
2. Accounting Policies and Es_4
2. Accounting Policies and Estimates (Details Narrative) | 12 Months Ended | |||
Dec. 31, 2022 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2021 USD ($) | |
Accounting Policies [Abstract] | ||||
Cash, FDIC Insured Amount | $ 250,000 | $ 100,000 | € 100,000 | |
Bad Debt Provision | 13,051 | $ 98,167 | ||
Bad Debt Provision | 0 | $ 0 | ||
Impairment of Goodwill | $ 14,501,669 |
Acquisition of subsidiaries (De
Acquisition of subsidiaries (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jul. 05, 2021 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | ||
Cash | $ 6,000,000 | |
Stock Issued During Period, Value, Acquisitions | 4,554,304 | $ 4,544,304 |
Contingent purchase consideration | 24,716,957 | |
Total purchase consideration | 35,261,261 | |
Recognized amounts of identifiable assets acquired and liabilities assumed | ||
Cash | 26,161 | |
Other Current assets | 151,284 | |
Property and equipment | 788 | |
Other non-current assets | 4,000 | |
Tradenames/Trademarks | 1,419,000 | |
Customer relationships | 7,275,000 | |
Non-compete agreements | 2,096,000 | |
10,972,233 | ||
Current liabilities assumed | (264,135) | |
Non-current liabilities assumed | (205,320) | |
Imputed Deferred taxation on identifiable intangible acquired | 2,265,900 | |
Net identifiable assets acquired and liabilities assumed | 8,236,878 | |
Goodwill | $ 27,024,383 |
Acquisition Combined Earnings (
Acquisition Combined Earnings (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenue | $ 1,105,986 | $ 45,957,894 |
Earnings | 1,064,889 | 15,887,232 |
Business Acquisition, Revenue Reported by Acquired Entity for Last Annual Period | $ (1,064,889) | $ (15,887,232) |
4. Acquisition of subsidiarie_2
4. Acquisition of subsidiaries (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jul. 15, 2021 | Jul. 05, 2021 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |||
Stock Issued During Period, Shares, Purchase of Assets | 1,265,823 | ||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 4,544,304 | ||
Undiscounted premium | $ 38,000,000 | ||
Purchase Aggrement | Purchase Agreement exceeds 4,401,020 and with a cap of 5,065,000 on the aggregate number of shares to be issued. | ||
Fair Value contingent purchase consideration | $ 24,716,957 | $ 24,716,957 | |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | $ 27,024,383 | ||
Acquisition Costs, Period Cost | 125,479 | ||
Other Depreciation and Amortization | $ 579,519 |
Plant and equipment (Details)
Plant and equipment (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 2,013,673 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 1,402,821 | |
Property, Plant and Equipment, Net | 610,852 | $ 490,079 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 58,808 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 40,932 | |
Property, Plant and Equipment, Net | 17,876 | 27,260 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 1,166,394 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 858,792 | |
Property, Plant and Equipment, Net | 307,602 | 223,214 |
Fixtures and fittings | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 437,442 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 277,320 | |
Property, Plant and Equipment, Net | 160,122 | 135,433 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 14,574 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 14,574 | |
Property, Plant and Equipment, Net | ||
Automobiles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Net | 44,837 | |
Computer Software, Intangible Asset [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 336,455 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 211,203 | |
Property, Plant and Equipment, Net | $ 125,252 | $ 59,335 |
6. Property and equipment (Deta
6. Property and equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 240,724 | $ 230,033 |
Right of use assets included in
Right of use assets included in the consolidated balance sheet are as follows: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Right of use assets - operating leases, net of amortization | $ 1,498,703 | $ 589,288 |
Right of use assets - finance leases, net of depreciation – included in property and equipment | 8,884 | 15,520 |
Finance lease cost: | 8,005 | 10,906 |
Amortization of right-of-use assets | 7,536 | 10,102 |
Interest expense on lease liabilities | 469 | 804 |
Operating lease cost | 408,062 | 244,639 |
Total lease cost | 416,067 | 255,545 |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash flows from finance leases | (469) | (804) |
Operating cash flows from operating leases | (408,062) | (244,639) |
Financing cash flows from finance leases | (7,809) | (10,172) |
Right-of-use assets obtained in exchange for new finance leases | 1,881 | |
Right-of-use assets disposed of under operating leases prior to lease maturity | (61,769) | (224,793) |
Right-of -use assets obtained in exchange for new operating leases | $ 1,351,211 | $ 406,276 |
Finance Lease, Weighted Average Remaining Lease Term | 1 year 9 months | 1 year 11 months 4 days |
Operating Lease, Weighted Average Remaining Lease Term | 4 years 21 days | 2 years 7 months 6 days |
Finance Lease, Weighted Average Discount Rate, Percent | 4.98% | 3.73% |
Operating Lease, Weighted Average Discount Rate, Percent | 3.02% | 2.73% |
Leases - Finance lease liabilit
Leases - Finance lease liability (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 7,142 | |
2024 | 1,260 | |
2025 | 488 | |
2026 | 488 | |
2027 and thereafter | 366 | |
Total undiscounted minimum future lease payments | 9,744 | |
Imputed interest | (625) | |
Total finance lease liability | 9,119 | |
Current portion | 6,831 | $ 8,347 |
Non-Current portion | $ 2,288 | $ 7,716 |
Leases - Operating lease liabil
Leases - Operating lease liability (Details) | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
2023 | $ 426,238 |
2024 | 356,755 |
2025 | 316,349 |
2026 | 279,540 |
2027 and thereafter | 264,650 |
Total undiscounted minimum future lease payments | 1,643,532 |
Imputed interest | (116,510) |
Total operating lease liability | 1,527,022 |
Current portion | 369,043 |
Non-Current portion | $ 1,157,979 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | |||
Impairment charge | $ 27,024,383 | $ 12,522,714 | |
Net | 15,557,561 | ||
Goodwill, Impaired, Accumulated Impairment Loss | (27,024,383) | (12,522,714) | |
Computer Software, Intangible Asset [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 8,628,105 | ||
Impairment charge | |||
Accumulated amortization | (1,851,619) | ||
Net | 6,776,486 | 4,745,895 | |
Goodwill, Impaired, Accumulated Impairment Loss | |||
Licensing Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 973,333 | ||
Impairment charge | |||
Accumulated amortization | (961,469) | ||
Net | 11,864 | 3,413 | |
Goodwill, Impaired, Accumulated Impairment Loss | |||
Contractual Rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 1,000,000 | ||
Impairment charge | |||
Accumulated amortization | (1,000,000) | ||
Net | |||
Goodwill, Impaired, Accumulated Impairment Loss | |||
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 8,145,927 | ||
Impairment charge | 4,750,000 | ||
Accumulated amortization | (1,072,022) | ||
Net | 2,323,905 | 7,538,533 | |
Goodwill, Impaired, Accumulated Impairment Loss | (4,750,000) | ||
Trademarks [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 1,537,318 | ||
Impairment charge | |||
Accumulated amortization | (274,049) | ||
Net | 1,263,269 | 1,413,887 | |
Goodwill, Impaired, Accumulated Impairment Loss | |||
Noncompete Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 2,096,000 | ||
Impairment charge | 1,331,833 | ||
Accumulated amortization | (764,167) | ||
Net | 1,855,833 | ||
Goodwill, Impaired, Accumulated Impairment Loss | (1,331,833) | ||
Websites | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 40,000 | ||
Impairment charge | |||
Accumulated amortization | (40,000) | ||
Net | $ 0 | ||
Goodwill, Impaired, Accumulated Impairment Loss |
Intangible Assets - Amortizatio
Intangible Assets - Amortization Expense (Details) - USD ($) | 12 Months Ended | 60 Months Ended | ||||
Dec. 31, 2026 | Dec. 31, 2025 | Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2026 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Operating Lease, Payments | $ 1,181,999 | $ 1,188,997 | $ 1,189,997 | $ 1,193,704 | $ 1,198,162 | $ 5,953,859 |
Goodwill (Details)
Goodwill (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Opening balance as of January 1, | $ 28,687,051 | $ 1,663,120 |
Acquisition of US Bookmaking | 27,024,383 | |
Foreign exchange movements | (390) | (452) |
Closing balance as of December 31. | 28,686,661 | 28,687,051 |
Opening balance as of January 1, | (12,522,714) | |
Impairment charge | (14,501,669) | (12,522,714) |
Closing balance as of December 31, | (27,024,383) | (12,522,714) |
Goodwill, net of impairment charges | $ 1,662,278 | $ 16,164,337 |
8. Intangible Assets (Details N
8. Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | $ 1,591,139 | $ 1,120,757 | |
Impariment charge | 27,024,383 | $ 12,522,714 | |
Ulisse [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impariment charge | $ 4,827,914 |
10. Marketable Securities (Deta
10. Marketable Securities (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Investments, All Other Investments [Abstract] | ||
Investment Company, Gain (Loss) on Investment, Per Share | $ 0.008 | |
Unrealized Gain (Loss) on Investments | $ 12,500 | $ 460,000 |
The maturity of bank loans paya
The maturity of bank loans payable as of December 31, 2022 is as follows: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Federal Home Loan Banks [Abstract] | ||
Within 1 year | $ 3,151 | |
1 to 2 years | 3,272 | |
2 to 3 years | 3,396 | |
3 to 4 years | 3,526 | |
5 years and thereafter | 137,975 | |
Total | 151,320 | |
Current portion | 3,151 | |
Non-Current portion | $ 148,169 | $ 151,321 |
11. Bank Loan Payable (Details
11. Bank Loan Payable (Details Narrative) | 12 Months Ended | 348 Months Ended | |||||
Dec. 31, 2022 USD ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2016 EUR (€) | May 31, 2050 USD ($) | Dec. 31, 2016 USD ($) | Dec. 31, 2016 EUR (€) | |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | |||||||
Advance from Federal Home Loan Bank | $ 151,320 | ||||||
Federal Home Loan Bank, Advance | $ 150,000 | ||||||
Federal Home Loan Bank, Advances, Activity for Year, Average Interest Rate for Year | 3.75% | ||||||
Federal Home Loan Bank, Advances, General Debt Obligations, Disclosures, Repayment and Penalties | $ 731 | ||||||
Repaid Capital | 5,570 | ||||||
Accrued and unpaid interest | 6,890 | ||||||
Intesa Sanpaolo Bank [Member] | |||||||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | |||||||
Advance from Federal Home Loan Bank | $ 545,000 | € 500,000 | |||||
Weighted Average Rate, Interest-Bearing Foreign Deposits, Point in Time | 4.50% | 4.50% | |||||
Debt Instrument, Frequency of Periodic Payment | 57 | ||||||
Debt Instrument, Periodic Payment | € | € 9,971 | € 9,760 | |||||
Repayments of Debt | 34,159 | 29,913 | |||||
Principal Payment | 33,184 | 29,059 | |||||
Interest Payment | $ 975 | € 854 |
Contigent Purchase Consideratio
Contigent Purchase Consideration (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Jul. 05, 2021 | |
Disclosure 12.Contingent Purchase Consideration Abstract | |||
Opening balance | $ 12,859,399 | ||
Contingent Consideration Classified as Equity, Fair Value Disclosure | 24,716,957 | $ 24,716,957 | |
Changes in fair value | (12,859,399) | (11,857,558) | |
Closing balance | $ 12,859,399 |
12. Contingent Purchase Consi_3
12. Contingent Purchase Consideration (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure 12.Contingent Purchase Consideration Abstract | |||
Additional Proceeds | $ 41,800,000 | ||
Contigent Purchase Consideration Liability | $ 12,859,399 |
Other long-term liabilities (De
Other long-term liabilities (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Severance liability | $ 464,851 | $ 359,567 |
14. Related Parties (Details Na
14. Related Parties (Details Narrative) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||
Jan. 07, 2022 USD ($) shares | Sep. 26, 2022 USD ($) | Jan. 22, 2021 USD ($) shares | Jan. 31, 2019 USD ($) | Jan. 31, 2019 EUR (€) | Dec. 31, 2021 USD ($) shares | Dec. 31, 2021 EUR (€) shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2021 EUR (€) shares | Jul. 15, 2021 USD ($) shares | Jul. 05, 2021 USD ($) | Sep. 26, 2022 USD ($) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2022 EUR (€) shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2019 USD ($) | Dec. 31, 2019 EUR (€) | Feb. 14, 2023 shares | Mar. 29, 2022 $ / shares shares | Sep. 13, 2021 $ / shares shares | Dec. 31, 2018 shares | |
Related Party Transaction [Line Items] | |||||||||||||||||||||
Proceeds from Related Party Debt | $ | $ 665,000 | ||||||||||||||||||||
Issuance of common stock, value | $ | $ 4,554,304 | $ 4,544,304 | |||||||||||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | shares | 7,000,000 | 7,000,000 | 7,000,000 | 7,000,000 | 16,000,000 | 16,000,000 | 7,000,000 | 1,150,000 | |||||||||||||
Cash Acquired from Acquisition | $ | $ 4,080,000 | ||||||||||||||||||||
Asset Acquisition, Price of Acquisition, Expected | $ | $ 6,000,000 | ||||||||||||||||||||
Noncash or Part Noncash Acquisition, Noncash Financial or Equity Instrument Consideration, Shares Issued | shares | 860,760 | ||||||||||||||||||||
Stock Issued During Period, Shares, Purchase of Assets | shares | 1,265,823 | ||||||||||||||||||||
Luca Pasquini | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 34% | 34% | 34% | 34% | 34% | ||||||||||||||||
Software Service, Support and Maintenance Arrangement [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Professional Fees | $ 459,572 | € 390,000 | $ 2,192,000 | € 1,980,000 | |||||||||||||||||
Braydon Capital Corp. | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Equipment Loan Agreement, Principal | $ | $ 500,000 | $ 500,000 | |||||||||||||||||||
Interest rate | 9% | ||||||||||||||||||||
Braydon Capital Corp [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Proceeds from Related Party Debt | $ | $ 360,000 | ||||||||||||||||||||
Luca Pasquini | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Purchase price | $ 4,576,352 | € 4,000,000 | |||||||||||||||||||
Payments to Acquire Businesses, Gross | $ 915,270 | € 800,000 | |||||||||||||||||||
Debt Instrument, Annual Principal Payment | € | 800,000 | ||||||||||||||||||||
Repayments of Other Debt | 500,000 | $ 604,380 | € 500,000 | ||||||||||||||||||
Issuance of common stock, value | € 300,000 | $ 334,791 | € 300,000 | ||||||||||||||||||
Issuance of common stock, shares | shares | 112,521 | 112,521 | |||||||||||||||||||
Stock based compensation, shares | shares | 44,968 | 500,000 | |||||||||||||||||||
Stock based compensation | $ | $ 257,217 | $ 226,800 | |||||||||||||||||||
Michele Ciavarella [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Stock based compensation, shares | shares | 425,000 | 1,003,265 | 24,476 | 24,476 | 300,000 | ||||||||||||||||
Stock based compensation | $ | $ 162,835 | $ 175,396 | $ 140,000 | $ 136,080 | |||||||||||||||||
Carlo Reali [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Stock based compensation, shares | shares | 200,000 | ||||||||||||||||||||
Stock based compensation | $ | $ 90,720 | ||||||||||||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | shares | 100,000 | ||||||||||||||||||||
Share-Based Payment Arrangement, Option, Exercise Price Range, Exercisable, Weighted Average Exercise Price | $ / shares | $ 2.50 | ||||||||||||||||||||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | 42,930 | 40,000 | |||||||||||||||||||
Salary | 82,244 | € 76,632 | |||||||||||||||||||
Victor Salerno [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | $ | 150,000 | ||||||||||||||||||||
Paul Sallwasser [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | shares | 154,132 | 21,300 | |||||||||||||||||||
Share-Based Payment Arrangement, Option, Exercise Price Range, Exercisable, Weighted Average Exercise Price | $ / shares | $ 5.10 | ||||||||||||||||||||
Steven Shallcross [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Stock based compensation, shares | shares | 5,245 | ||||||||||||||||||||
Stock based compensation | $ | $ 30,000 | ||||||||||||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | shares | 131,631 | 13,600 | |||||||||||||||||||
Share-Based Payment Arrangement, Option, Exercise Price Range, Exercisable, Weighted Average Exercise Price | $ / shares | $ 5.10 | ||||||||||||||||||||
Andrea Mandel Mantello [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | shares | 131,631 | 13,600 | |||||||||||||||||||
Share-Based Payment Arrangement, Option, Exercise Price Range, Exercisable, Weighted Average Exercise Price | $ / shares | $ 5.10 | ||||||||||||||||||||
Aiden Ciavarella [Member] | |||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||
Salary | $ | $ 75,000 |
Related Party Receivables (Deta
Related Party Receivables (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Related Party Transaction [Line Items] | ||
Related Party payables | $ (422,129) | $ (502) |
Related Party Receivables | 22,511 | 1,413 |
Engage I Tsrl [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party payables | (406,467) | |
Luca Pasquini | ||
Related Party Transaction [Line Items] | ||
Related Party payables | (459) | (502) |
Related Party Receivables | 1,413 | |
Michele Ciavarella [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party payables | (15,203) | |
Victor Salerno [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Receivables | $ 22,511 |
Equipment Loan - Related Party
Equipment Loan - Related Party (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transactions [Abstract] | ||
Opening balance | $ 50,000 | |
Promissory note payable on acquisition of US Bookmaking | 50,000 | |
Loans advanced – Braydon Capital Corp | 360,000 | |
Loans advanced – Victor Salerno | 305,000 | |
Closing balance | 715,000 | 50,000 |
Opening balance | 1,878 | |
Accrued interest | 35,122 | 1,878 |
Closing balance | 37,000 | 1,878 |
[custom:PromissoryNotesPayableRelatedParties-0] | $ 752,000 | $ 51,878 |
15. Stockholders_ Equity (Detai
15. Stockholders’ Equity (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 5 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 10, 2022 | Jan. 07, 2022 | Jan. 22, 2021 | Dec. 31, 2021 | Jun. 13, 2022 | Sep. 26, 2022 | Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Placement Agreement | $ 387,053 | ||||||
Clearing Fees | $ 15,950 | 11,612 | |||||
Legal Fees | $ 50,000 | ||||||
Pre-Funded Warrants | 541,227 | ||||||
Michele Ciavarella [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Shares Issued, Shares, Share-Based Payment Arrangement, after Forfeiture | 425,000 | 1,003,265 | 24,476 | 300,000 | |||
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | $ 162,835 | $ 175,396 | $ 140,000 | $ 136,080 | |||
Carlo Reali [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Shares Issued, Shares, Share-Based Payment Arrangement, after Forfeiture | 200,000 | ||||||
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | $ 90,720 | ||||||
Warrants Exercisable | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Class of Warrant or Right, Outstanding | 2,625,000 | ||||||
Exercise Price | $ 0.0001 | ||||||
Warrants Exercisable 2 [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Class of Warrant or Right, Outstanding | 3,166,227 | ||||||
Exercise Price | $ 0.9475 | ||||||
Pre Funded Warrants Exercisable [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Placement Agreement | $ 3,000,000 | ||||||
Common Stock [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Shares Issued, Shares, Share-Based Payment Arrangement, after Forfeiture | 3,500,000 | ||||||
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | $ 1,587,600 | ||||||
Placement Agreement | 168,016 | ||||||
Related Party [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Shares Issued, Shares, Share-Based Payment Arrangement, after Forfeiture | 162,835 | ||||||
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | $ 425,000 |
Warrants (Details)
Warrants (Details) - $ / shares | 5 Months Ended | 12 Months Ended | |
Jun. 13, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Warrants: Number of Shares | |||
[custom:PrefundedWarrantsIssuedDuringPeriod] | 541,227 | ||
Warrant [Member] | |||
Warrants: Number of Shares | |||
Class of Warrant or Right, Outstanding | 3,664,168 | 546,336 | |
[custom:PrefundedWarrantsIssuedDuringPeriod] | 541,227 | ||
Warrants Excercised During Period | (541,227) | (1,506,809) | |
[custom:WarrantsCanceledDuringPeriod] | (48,395) | ||
[custom:WarrantsIssuedDuringPeriod] | 3,166,227 | ||
Class of Warrant or Right, Outstanding | 546,336 | 546,336 | 2,053,145 |
Warrants: Exercise price per share | |||
Warrant Exercise Price Per Share Forfeited | $ 3.75 | ||
Warrants: Weighted average exercise price | |||
Temporary Equity, Redemption Price Per Share | 1.17 | $ 2.66 | |
Warrant Exercise During Period | 2.63 | ||
[custom:WarrantsGrantedDuringPeriod] | |||
Temporary Equity, Redemption Price Per Share | $ 2.66 | 2.66 | 2.63 |
Warrant Exercise Price Per Share Exercised | 0.0001 | ||
Warrant [Member] | Minimum [Member] | |||
Warrants: Exercise price per share | |||
Warrant Exercise Price Per Share Granted | 0.9475 | ||
Warrant Exercise Price Per Share Granted Prefunded | 0.0001 | ||
Warrants: Weighted average exercise price | |||
Warrant Exercise Price Per Share | 2.50 | 2.50 | 2.50 |
Warrant Exercise Price Per Share Exercised | 2.50 | ||
Warrant Exercise Price Per Share | 0.9475 | 2.50 | |
Warrant [Member] | Maximum [Member] | |||
Warrants: Weighted average exercise price | |||
Warrant Exercise Price Per Share | $ 5 | 5 | 5 |
Warrant Exercise Price Per Share Exercised | 5 | ||
Warrant Exercise Price Per Share | $ 5 | $ 5 |
Warrants oustanding, exercise p
Warrants oustanding, exercise price (Details Narrative) | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Class of Warrant or Right [Line Items] | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.17 |
Warrant Price 0. 9457 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of shares | 3,166,227 |
Weighted average remianing years | 4 years 11 months 15 days |
Warrant Price 2. 50 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of shares | 486,173 |
Weighted average remianing years | 2 years 7 months 17 days |
Warrant Price 5. 00 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of shares | 11,768 |
Weighted average remianing years | 4 months 28 days |
Warrant [Member] | |
Class of Warrant or Right [Line Items] | |
Number of shares | 3,664,168 |
Weighted average remianing years | 4 years 7 months 20 days |
Stock option Assumptions (Detai
Stock option Assumptions (Details) | 12 Months Ended |
Dec. 31, 2021 $ / shares | |
Share-Based Payment Arrangement [Abstract] | |
Exercise price | $ 0.454 |
Exercise price | $ 2.50 |
Risk free interest rate | 2.41% |
Risk free interest rate | 3.69% |
Expected life of options | 10 |
Expected volatility of underlying stock | 204.20% |
Expected volatility of underlying stock | 205.30% |
Expected dividend rate | 0% |
Stock Option Activity (Details)
Stock Option Activity (Details) - Share-Based Payment Arrangement [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Option Activity | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number, Beginning Balance | 2,766,438 | 1,622,938 |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross | 270,000 | 1,193,500 |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Forfeitures in Period | (652,375) | (50,000) |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercises in Period | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number, Ending Balance | 2,384,063 | 2,766,438 |
Weighted Average exercise price | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 2.92 | $ 2.11 |
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | 1.67 | 3.15 |
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price | 1.85 | 2.62 |
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance | 3.07 | 2.92 |
Minimum [Member] | ||
Exercise price per share | ||
Stock Option Exercise price per share | 1.84 | 1.84 |
Stock Option, Exercise Price, Increase | 0.454 | 2.62 |
Stock Option, Exercise Price, Decrease | 1.84 | 2.62 |
Stock Option Exercise Price Per Share | 0.454 | 1.84 |
Maximum [Member] | ||
Exercise price per share | ||
Stock Option Exercise price per share | 5.10 | 2.96 |
Stock Option, Exercise Price, Increase | 2.50 | 5.10 |
Stock Option, Exercise Price, Decrease | 2.80 | |
Stock Option Exercise Price Per Share | $ 5.10 | $ 5.10 |
Stock Options - Stock options o
Stock Options - Stock options outstanding (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 2,384,063 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 1 month 20 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 1,287,381 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 3.07 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Exercise Price | $ 2.99 | |
Exercise Price. 045 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 0.45 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 110,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 9 years 8 months 26 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | ||
Exercise Price 2. 03 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 2.03 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 659,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 7 years 9 months | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 530,500 | |
Exercise Price 2. 50 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 2.50 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 160,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 9 years 3 months | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | ||
Exercise Price 2. 72 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 2.72 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 25,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 3 years 6 months | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 25,000 | |
Exercise Price 2. 80 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 2.80 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 216,250 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 6 years 8 months 23 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 176,068 | |
Exercise Price 2. 96 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 2.96 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 70,313 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 6 years 6 months 7 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 70,313 | |
Exercise Price 3. 43 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 3.43 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 25,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 11 months 19 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 9,000 | |
Exercise Price 4. 03 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 4.03 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 1,020,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 6 months 3 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 410,000 | |
Exercise Price 4. 07 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 4.07 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 25,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 6 months 14 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 9,000 | |
Exercise Price 4. 20 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 4.20 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 25,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 4 months 2 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 9,000 | |
Exercise Price 5. 10 [Member] | ||
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | ||
Share Price | $ 5.10 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 48,500 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 8 years 8 months 15 days | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 48,500 |
17. Stock Options (Details Narr
17. Stock Options (Details Narrative) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 25, 2022 | Dec. 31, 2018 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock Options available | 16,000,000 | 7,000,000 | 1,150,000 | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Other Share Increase (Decrease) | 9,000,000 | 4,000,000 | 1,850,000 | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ 1.67 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Number of Shares | 1,096,682 | |||||
Share-Based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 3,127,467 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Intrinsic Value | $ 0 | |||||
Share-Based Payment Arrangement, Option [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Number of Shares | 2,384,063 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross | 4,155,301 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant | 9,460,636 | |||||
Share-Based Payment Arrangement, Option [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock Options available | 160,000 | 110,000 | ||||
Temporary Equity, Redemption Price Per Share | $ 2.50 | $ 0.454 | ||||
Stock Option Interim C F O [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock Options available | 100,000 | |||||
Stock Option Employee [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock Options available | 60,000 |
Revenues (Details)
Revenues (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Total Handle (Turnover) | $ 770,155,564 | $ 841,860,837 |
Total Winnings/Payouts | 717,288,074 | 784,694,829 |
Gross Gaming Revenues | 52,867,490 | 57,166,008 |
Less: ADM Gaming Taxes | 12,787,700 | 12,657,930 |
Net Gaming Revenues | 40,079,790 | 44,508,078 |
Betting platform software and services | 2,598,869 | 1,038,713 |
Revenues | 42,678,659 | 45,546,791 |
Web Based [Member] | ||
Total Handle (Turnover) | 755,248,396 | 826,789,619 |
Total Winnings/Payouts | 704,932,499 | 771,852,252 |
Land Based [Member] | ||
Total Handle (Turnover) | 14,907,168 | 15,071,218 |
Total Winnings/Payouts | $ 12,355,575 | $ 12,842,577 |
Net Income (Loss) per Common Sh
Net Income (Loss) per Common Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Options | 2,384,063 | 2,766,438 |
Warrants | 3,664,168 | 546,336 |
6,048,231 | 3,312,774 |
Income Taxes - Income tax expen
Income Taxes - Income tax expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
U.S. Statutory rate | $ 4,132,475 | $ 3,224,547 |
Items not allowed for tax purposes | 1,421,480 | 1,705,372 |
Foreign tax rate differential | 8,523 | (2,367) |
Additional foreign taxation | (24,805) | 27,495 |
Prior year over provision | 7,637 | 125,887 |
Movement in valuation allowances | (1,282,115) | (1,379,714) |
Income tax benefit | $ 1,420,235 | $ 290,476 |
Income Taxes - Benefit (Provisi
Income Taxes - Benefit (Provision) Income tax expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Current | $ (175,105) | $ 94,041 |
Withholding tax | ||
Deferred | $ 1,595,340 | $ 196,434 |
Income Taxes - Deferred tax ass
Income Taxes - Deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Disclosure [Abstract] | ||
Working capital movements | $ 496,910 | $ 247,563 |
Property and equipment | (2,243) | |
Net loss carryforward – Foreign | 416,728 | 443,100 |
Net loss carryforward – US | 6,806,054 | 5,815,807 |
7,717,449 | 6,506,470 | |
Less valuation allowance | (7,717,449) | (6,506,470) |
Intangible assets | (1,696,638) | (3,291,978) |
Deferred Tax Liability | 1,696,638 | 3,291,978 |
Deferred Tax Liability | $ (1,696,638) | $ (3,291,978) |
20. Income Taxes (Details Narra
20. Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Italy corporate tax rate | 27.90% | |
Austrian corporate tax rate | 25% | |
Canadian corporate tax rate | 26.50% | |
Colombia corporate tax rate | 35% | |
U.S. statutory rate | 21% | 21% |
Net operating loss carryforward | $ 32,400,000 | |
Net operating loss carryforward adjustments on prior year | 100,000 | |
Net operating loss to expire | $ 11,100,000 | |
Net loss carryforward for US Entities | $ 100,000 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Net Gaming Revenue | $ 40,079,790 | $ 44,508,078 |
Betting platform and services revenue | 2,598,869 | 1,038,713 |
Intercompany Service revenue | ||
42,678,659 | 45,546,791 | |
Operating expenses | ||
Intercompany service expense | ||
Selling expenses | 32,705,928 | 36,274,752 |
General and administrative expenses | 19,977,275 | 17,466,786 |
Depreciation and amortization | 1,832,204 | 1,351,173 |
Impairment of license | 20,583,502 | 17,350,628 |
75,098,909 | 72,443,339 | |
Loss from operations | (32,420,250) | (26,896,548) |
Other Income (expenses) | ||
Interest expense, net | (43,599) | (20,985) |
Amortization of debt discount | (12,833) | |
Change in fair value of contingent purchase consideration | 12,859,399 | 11,857,558 |
Other income | 22,045 | 227,788 |
Other expense | (108,548) | (49,967) |
Loss on marketable securities | 12,500 | (460,000) |
Total other income (expenses) | 12,741,797 | 11,541,561 |
Loss before Income Taxes | (19,678,453) | (15,354,987) |
Income tax provision | 1,420,235 | |
Net Loss | (18,258,218) | |
Income tax provision | 1,420,235 | 290,476 |
Net Loss | (18,258,218) | (15,064,511) |
All other | ||
Segment Reporting Information [Line Items] | ||
Net Gaming Revenue | ||
Betting platform and services revenue | ||
Intercompany Service revenue | ||
Operating expenses | ||
Intercompany service expense | 55,704 | |
Selling expenses | ||
General and administrative expenses | 8,293,364 | 6,290,971 |
Depreciation and amortization | 22,962 | 44,016 |
Impairment of license | ||
8,372,030 | ||
Loss from operations | (8,372,030) | (6,334,987) |
Other Income (expenses) | ||
Interest expense, net | (2,637) | (5,154) |
Amortization of debt discount | (12,833) | |
Change in fair value of contingent purchase consideration | 12,859,399 | |
Other income | 7,977 | |
Other expense | ||
Loss on marketable securities | 12,500 | (460,000) |
Total other income (expenses) | 12,869,262 | (470,010) |
Loss before Income Taxes | 4,497,232 | (6,804,997) |
Income tax provision | ||
Net Loss | 4,497,232 | |
Income tax provision | ||
Net Loss | (6,804,997) | |
Betting platform software and services | ||
Segment Reporting Information [Line Items] | ||
Net Gaming Revenue | ||
Betting platform and services revenue | 2,346,940 | 886,163 |
Intercompany Service revenue | 2,489,549 | 4,211,774 |
4,836,489 | ||
Operating expenses | ||
Intercompany service expense | 65,539 | 321,775 |
Selling expenses | 343,086 | 47,208 |
General and administrative expenses | 5,808,124 | 4,911,941 |
Depreciation and amortization | 1,590,938 | 936,496 |
Impairment of license | 20,583,502 | 12,522,714 |
28,391,189 | ||
Loss from operations | (23,554,700) | (13,642,197) |
Other Income (expenses) | ||
Interest expense, net | (39,897) | (4,662) |
Amortization of debt discount | ||
Change in fair value of contingent purchase consideration | 11,857,558 | |
Other income | 2 | 2,560 |
Other expense | (17,690) | (26,262) |
Loss on marketable securities | ||
Total other income (expenses) | (57,585) | 11,829,194 |
Loss before Income Taxes | (23,612,285) | (1,813,003) |
Income tax provision | 1,561,714 | |
Net Loss | (22,050,571) | |
Income tax provision | 170,586 | |
Net Loss | (1,642,417) | |
Intersubsegment Eliminations [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Gaming Revenue | ||
Betting platform and services revenue | ||
Intercompany Service revenue | (2,610,792) | (4,533,549) |
(2,610,792) | ||
Operating expenses | ||
Intercompany service expense | (2,610,792) | (4,533,549) |
Selling expenses | ||
General and administrative expenses | ||
Depreciation and amortization | ||
Impairment of license | ||
(2,610,792) | ||
Loss from operations | ||
Other Income (expenses) | ||
Interest expense, net | ||
Amortization of debt discount | ||
Change in fair value of contingent purchase consideration | ||
Other income | ||
Other expense | ||
Loss on marketable securities | ||
Total other income (expenses) | ||
Loss before Income Taxes | ||
Income tax provision | ||
Net Loss | ||
Income tax provision | ||
Net Loss | ||
Betting establishments | ||
Segment Reporting Information [Line Items] | ||
Net Gaming Revenue | 40,079,790 | 44,508,078 |
Betting platform and services revenue | 251,929 | 152,550 |
Intercompany Service revenue | 121,243 | 321,775 |
40,452,962 | ||
Operating expenses | ||
Intercompany service expense | 2,489,549 | 4,211,774 |
Selling expenses | 32,362,842 | 36,227,544 |
General and administrative expenses | 5,875,787 | 6,263,874 |
Depreciation and amortization | 218,304 | 370,661 |
Impairment of license | 4,827,914 | |
40,946,482 | ||
Loss from operations | (493,520) | (6,919,364) |
Other Income (expenses) | ||
Interest expense, net | (1,065) | (11,169) |
Amortization of debt discount | ||
Change in fair value of contingent purchase consideration | ||
Other income | 22,043 | 217,251 |
Other expense | (90,858) | (23,705) |
Loss on marketable securities | ||
Total other income (expenses) | (69,880) | 182,377 |
Loss before Income Taxes | (563,400) | (6,736,987) |
Income tax provision | (141,479) | |
Net Loss | $ (704,879) | |
Income tax provision | 119,890 | |
Net Loss | $ (6,617,097) |
Segment reporting_ Operating as
Segment reporting: Operating assets and liabilities (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Payments for Purchase of Other Assets | $ 2,907,268 | $ 717,080 |
Assets | ||
Current assets | 6,825,212 | 11,383,485 |
Non-Current assets | 14,532,057 | 33,195,356 |
Liabilities | ||
Current liabilities | (10,736,929) | (9,827,179) |
Non-Current liabilities | (3,469,925) | |
Intercompany balances | ||
Net asset position | 7,150,415 | 17,741,517 |
Non-Current liabilities | (3,469,925) | (17,010,145) |
All other | ||
Segment Reporting Information [Line Items] | ||
Payments for Purchase of Other Assets | 76,413 | 43,552 |
Assets | ||
Current assets | 101,817 | 1,443,280 |
Non-Current assets | 77,325 | 11,374 |
Liabilities | ||
Current liabilities | (1,590,522) | (1,564,234) |
Non-Current liabilities | ||
Intercompany balances | (1,915,154) | (2,682,094) |
Net asset position | (3,326,534) | (2,791,674) |
Non-Current liabilities | ||
Betting platform software and services | ||
Segment Reporting Information [Line Items] | ||
Payments for Purchase of Other Assets | 2,547,189 | 538,256 |
Assets | ||
Current assets | 1,740,683 | 1,291,700 |
Non-Current assets | 11,594,748 | 31,203,882 |
Liabilities | ||
Current liabilities | (2,649,357) | (652,368) |
Non-Current liabilities | (1,909,570) | |
Intercompany balances | (4,027,794) | (1,677,692) |
Net asset position | 4,748,710 | 13,823,248 |
Non-Current liabilities | (16,342,274) | |
Betting establishments | ||
Segment Reporting Information [Line Items] | ||
Payments for Purchase of Other Assets | 283,666 | 135,272 |
Assets | ||
Current assets | 4,982,712 | 8,648,505 |
Non-Current assets | 2,859,984 | 1,980,100 |
Liabilities | ||
Current liabilities | (6,497,050) | (7,610,577) |
Non-Current liabilities | (1,560,355) | |
Intercompany balances | 5,942,948 | 4,359,786 |
Net asset position | $ 5,728,239 | 6,709,943 |
Non-Current liabilities | $ (667,871) |
22. Subsequent Events (Details
22. Subsequent Events (Details Narrative) - USD ($) | 1 Months Ended | ||||||
Feb. 14, 2023 | Jan. 30, 2023 | Jan. 29, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 13, 2021 | Dec. 31, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | |||||||
Convertible debenture funding | 2,000 | ||||||
Terms | Each Unit sold to Investors was sold at a per unit price of $1,000 and was comprised of (i) a 12% convertible debenture in the principal amount of $1,000 (the “Debentures”), and (ii) warrants to purchase shares of the Company’s common stock (the “Warrants”). | ||||||
Convertible debenture funding | $ 850,000 | ||||||
Convertible debenture funding | 2,179,487 | ||||||
Restricted stock awards | 5,366,155 | ||||||
Stock options awards | 16,000,000 | 7,000,000 | 1,150,000 | ||||
Warrants for services | $ 200,000 | ||||||
Terms | Warrant is exercisable at a price of $0.89 per share and vests at a rate of 1,000 warrant shares for each reduction of 10,000 shares of Reduction in Imbalances (Shorts) | ||||||
Steven Shallcross [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Stock options awards | 131,631 | 13,600 | |||||
Stock options awards | 54,753 | ||||||
Directors and executive compensation | $ 20,000 | ||||||
Directors and executive compensation | 22,472 | ||||||
Andrea Mandel Mantello [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Stock options awards | 131,631 | 13,600 | |||||
Stock options awards | 54,753 | ||||||
Directors and executive compensation | $ 40,000 | ||||||
Directors and executive compensation | 44,944 | ||||||
Paul Sallwasser [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Stock options awards | 154,132 | 21,300 | |||||
Stock options awards | 77,254 | ||||||
Michele Ciavarella [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Decrease im Executive compensation | $ 372,000 |