Arena Group Holdings, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer(s) and principal financial officer(s), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. In accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was completed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the fiscal year ended December 31, 2021. This evaluation commenced in 2021 and continued until the filing of this Annual Report. Based on that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective in providing reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. 41 Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act). Internal control over financial reporting is a process, including policies and procedures, designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. Our management assessed our internal control over financial reporting based on the Internal Control—Integrated Framework (2013 Framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives. Auditor’s Report on Internal Control Over Financing Reporting This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC that permit us to provide only management’s report in this Annual Report. Remediation of Material Weakness As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020, we previously identified a material weakness in our internal control over financial reporting, primarily as a result of (i) the lack of monitoring over the completeness and accuracy of our underlying accounting records and ineffective controls over our period end financial disclosure and reporting processes and information technology systems; (ii) inadequate segregation of duties consistent with control objectives; and (iii) a history of untimely filed periodic reports. As of the date of this Annual Report, management believes that it has implemented specific measures sufficient to fully remediate each of the deficiencies that had resulted in the material weakness. Specific remedial actions undertaken by management have included, without limitation: ● assessing and identifying risks for significant accounts and disclosures based on the most recent financial statements and performing a financial statement risk assessment; ● mapping all of our entity-level controls to the framework established by the COSO Internal Control – 2013 Integrated Framework; ● developing process documentation of procedures and controls for significant financial processes, reflective of an enhanced control environment; ● hiring a Chief Accounting Officer; ● identifying and assessing management review controls; ● performing an information technology process risk and controls assessment which details management’s controls over user access reviews of significant systems; ● reviewing system and organizational controls reports for all in-scope systems; ● implementing procedures to ensure the segregation of duties and hiring additional resources to ensure appropriate review and oversight; ● evaluating segregation of duties within key process and controls to determine whether segregation of duties existed as part of the existing control or if compensating controls were in place to assist in mitigating any segregation of duties risks; and ● becoming current in our Exchange Act filing obligations. As a result of these remediation activities and, based on the result of the operating effectiveness testing we performed for the new and modified controls, management concluded that the previously disclose material weakness no longer existed as of December 31, 2021. We will continue to monitor the effectiveness of these and other processes, procedures, and controls and will make any further changes that management determines to be appropriate. Changes in Internal Control over Financial Reporting In connection with our continued monitoring and maintenance of our controls procedures as part of the implementation of Section 404 of the Sarbanes, we continue to review, test, and improve the effectiveness of our internal controls. Except for the changes in connection with our implementation of the remediation actions discussed above, under “Remediation of Material Weakness” there have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the during the fourth quarter and since the year ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information None. Part III Item 10. Directors, Executive Officers and Corporate Governance Current Officers and Directors The information required under this item is incorporated herein by reference to our proxy statement for our fiscal 2022 Annual Stockholders’ Meeting to be filed with the SEC not later than 120 days after the end of fiscal 2021. Item 11. Executive Compensation The information required under this item is incorporated herein by reference to our proxy statement for our fiscal 2022 Annual Stockholders’ Meeting to be filed with the SEC not later than 120 days after the end of fiscal 2021. 42 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required under this item is incorporated herein by reference to our proxy statement for our fiscal 2022 Annual Stockholders’ Meeting to be filed with the SEC not later than 120 days after the end of fiscal 2021, with the exception of those items listed below. Securities Authorized for Issuance Under Equity Compensation Plans A summary of our securities authorized for issuance under equity compensation plans as of December 31, 2021 is as follows: Equity Compensation Plan Information Plan Category (a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) Equity compensation plans approved by security holders 5,397,743 $ 15.37 3,376,672 Equity compensation plans not approved by security holders 1,173,769 13.89 55,316 Total 6,571,512 $ 15.11 3,431,988 Plans Adopted Without Approval of Security Holders Publisher Partner Warrant Program On December 19, 2016, as amended on August 23, 2017, and August 23, 2018, our Board approved the Channel Partner Warrant Program (the “Publisher Partner Warrant Program”) to be administered by management that authorized us to grant to certain of the Publisher Partners, Publisher Partner Warrants (the “Publisher Partner Warrants”) to purchase up to 90,910 shares of our common stock pursuant to the Publisher Partner Warrant Program. The Publisher Partner Warrant Program was intended to provide equity incentive to the Publisher Partners to motivate and reward them for their services to us and to align the interests of the Publisher Partners with those of our stockholders. The Publisher Partner Warrants had certain performance conditions. Pursuant to the terms of the Publisher Partner Warrants, we would notify the respective Publisher Partner of the number of shares earned, with one-third of the earned shares vesting on the notice date, one-third of the earned shares vesting on the first anniversary of the notice date, and the remaining one-third of the earned shares vesting on the second anniversary of the notice date. The Publisher Partner Warrants had a term of five years from issuance and could also be exercised on a cashless basis. Performance conditions are generally based on the average of number of unique visitors on the channel operation by the Publisher Partner generated during the six-month period from the launch of the Publisher Partner’s operations on our platform or the revenue generated during the period from the issuance date through a specified end date. On March 10, 2019, our Board terminated the initial Publisher Partner Warrant Program, and approved the “second” Publisher Partner Warrant Program, that authorized us to grant Publisher Partner Warrants to purchase up to 227,273 shares of our common stock. Such Publisher Partner Warrants were to be issued with the same terms as the first Publisher Partner Warrant Program, except that the shares of our common stock underlying these Publisher Partner Warrants are earned and vest over three years and have a five-term. On May 20, 2020, our Board terminated the second Publisher Partner Warrant Program, and approved the “third” Publisher Partner Warrant Program, that authorized us to grant Publisher Partner Warrants to purchase up to 227,273 shares of our common stock. Such Publisher Partner Warrants granted under the third Publisher Partner Warrant Program were to be issued with the same terms as the second Publisher Partner Warrant Program, except that any Publisher Partner Warrants issued under the third Publisher Partner Warrant Program are no longer subject to performance conditions. We have not granted any Publisher Partner Warrants since fiscal 2018. Outside Options During fiscal 2018, our Board approved the granting of options outside of the 2016 Plan (the “Outside Options”) to certain officers, directors, and employees to provide equity incentive in exchange for consideration in the form of services to us. The Outside Options are exercisable for shares of our common stock. The Outside Options either vest upon the passage of time or are tied to the achievement of certain performance targets. On January 8, 2021, our Board approved an amendment to the Outside Option award grants, which eliminated the performance targets, therefore, the awards continue to vest solely on the time vesting conditions. Warrants On June 14, 2019, our Board approved the grant of the warrants to acquire up to 21,989,844 shares our common stock to ABG in connection with the Sports Illustrated Licensing Agreement. Half the warrants have an exercise price of $0.42 per share (the “Forty-Two Cents Warrants”). The other half of the warrants have an exercise price of $0.84 per share (the “Eighty-Four Cents Warrants”). The warrants provide for the following: (1) 40% of the Forty-Two Cents Warrants and 40% of the Eighty-Four Cents Warrants will vest in equal monthly increments over a period of two years beginning on the one-year anniversary of the date of issuance of the warrants (any unvested portion of such warrants to be forfeited by ABG upon certain terminations by us of the Sports Illustrated Licensing Agreement); (2) 60% of the Forty-Two Cents Warrants and 60% of the Eighty-Four Cents Warrants will vest based on the achievement of certain performance goals for the Sports Illustrated licensed brands in calendar years 2020, 2021, 2022, or 2023; (3) under certain circumstances we may require ABG to exercise all (and not less than all) of the warrants, in which case all of the warrants will be vested; (4) all of the warrants will automatically vest upon certain terminations of the licensing agreement by ABG or upon a change of control of us; and (5) ABG will have the right to participate, on a pro-rata basis (including vested and unvested warrants, exercised or unexercised), in any of our future equity issuances (subject to customary exceptions). In June 2021, the exercise price of fifty percent (50%) of the Eighty-Four Cents Warrants was changed to $0.42 per share in exchange for additional benefits under the Sports Illustrated Licensing Agreement. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required under this item is incorporated herein by reference to our proxy statement for our fiscal 2022 Annual Stockholders’ Meeting to be filed with the SEC not later than 120 days after the end of fiscal 2021. Item 14. Principal Accountant Fees and Services The information required under this item is incorporated herein by reference to our proxy statement for our fiscal 2022 Annual Stockholders’ Meeting to be filed with the SEC not later than 120 days after the end of fiscal 2021. Part IV Item 15. Exhibits and Financial Statement Schedules (a) The following documents are filed as part of this Annual Report: 1. Index to Consolidated Financial Statements . Our consolidated financial statements and the Report of Marcum LLP, Independent Registered Public Accounting Firms are included in Part IV of this Annual Report on the pages indicated: Page Report of Independent Registered Public Accounting Firm F-2 Consolidated Balance Sheets as of December 31, 2021 and 2020 F-5 Consolidated Statements of Operations for the Years Ended December 31, 2021 and 2020 F-6 Consolidated Statements of Stockholders’ Deficiency for the Years Ended December 31, 2021 and 2020 F-7 Consolidated Statements of Cash Flows for the Years Ended December 31, 2021 and 2020 F-8 Notes to Consolidated Financial Statements F-9 2. Financial Statement Schedules . Reference is made to the Financial Statements filed under Item 8, Part II of this Annual Report. 43 Exhibit Description 2.1 Agreement and Plan of Merger, dated as of March 13, 2018, by and among the Company, HP Acquisition Co., Inc., HubPages, Inc., and Paul Edmondson as the securityholder representative, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 19, 2018. 2.2 Amendment to Agreement and Plan of Merger, dated as of April 25, 2018, by and among TheMaven, Inc., HP Acquisition Co., Inc., HubPages, Inc., and Paul Edmondson as the securityholder representative, which was filed as Exhibit 2.2 to our Annual Report on Form 10-K filed on January 8, 2021. 2.3 Second Amendment to Agreement and Plan of Merger, dated as of June 1, 2018, by and among TheMaven, Inc., HP Acquisition Co., Inc., HubPages, Inc., and Paul Edmondson as the securityholder representative, which was filed as Exhibit 10.1 to our Current Report on Form 8-K/A filed on June 4, 2018. 2.4 Third Amendment to Agreement and Plan of Merger, dated as of May 31, 2019, by and among TheMaven, Inc., HP Acquisition Co., Inc., HubPages, Inc., and Paul Edmondson as the securityholder representative, which was filed as Exhibit 2.4 to our Annual Report on Form 10-K filed on January 8, 2021. 2.5 Fourth Amendment to Agreement and Plan of Merger, dated as of December 15, 2020, by and among TheMaven, Inc., HP Acquisition Co., Inc., HubPages, Inc., and Paul Edmondson as the securityholder representative, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on December 21, 2020. 2.6 Amended and Restated Asset Purchase Agreement, dated as of August 4, 2018, by and among the Company, Maven Coalition, Inc., and Say Media, Inc., which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on August 9, 2018. 2.7 Amendment to Amended and Restated Asset Purchase Agreement, dated as of August 24, 2018, by and among the Company, Maven Coalition, Inc., and Say Media, Inc., which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on August 29, 2018. 2.8 Agreement and Plan of Merger, dated as of October 12, 2018, by and among the Company, SM Acquisition Co., Inc., Say Media, Inc., and Matt Sanchez as the Securityholder Representative, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 17, 2018. 2.9 Amendment to Agreement and Plan of Merger, dated as of October 17, 2018, by and among the Company, SM Acquisition Co., Inc., Say Media, Inc., and Matt Sanchez as the Securityholder Representative, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on October 17, 2018. 2.10 Agreement and Plan of Merger, dated as of June 11, 2019, by and among the Company, TST Acquisition Co., Inc., and TheStreet, Inc., which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on June 12, 2019. 3.1 Amended and Restated Certificate of Incorporation of the Registrant, which was filed as Exhibit 3.1 to our Current Report on Form 8-K filed on October 13, 2021. 3.2 Second Amended and Restated Bylaws, which was filed as Exhibit 3.2 to our Current Report on Form 8-K filed on October 13, 2021. 3.3 Certificate of Elimination of Series F Convertible Preferred Stock as filed with the Delaware Secretary of State on September 7, 2021, which was filed as Exhibit 3.1 to our Current Report on Form 8-K filed September 13, 2021. 3.4 Certificate of Elimination of Series I Convertible Preferred Stock as filed with the Delaware Secretary of State on September 7, 2021, which was filed as Exhibit 3.2 to our Current Report on Form 8-K filed September 13, 2021. 3.5 Certificate of Elimination of Series J Convertible Preferred Stock as filed with the Delaware Secretary of State on September 7, 2021, which was filed as Exhibit 3.3 to our Current Report on Form 8-K filed September 13, 2021. 3.6 Certificate of Elimination of Series K Convertible Preferred Stock as filed with the Delaware Secretary of State on September 7, 2021, which was filed as Exhibit 3.4 to our Current Report on Form 8-K filed September 13, 2021. 3.7 Certificate of Amendment as filed with the Delaware Secretary of State on January 20, 2022, which was filed Exhibit 3.1 to our Current Report on Form 8-K filed January 26, 2022. 3.8 Certificate of Correction of the Certificate of Amendment of the Amended and Restated Certificate of Incorporation, filed with the Secretary of State of the State of Delaware on January 26, 2022, which was filed as Exhibit 3.2 to our Current Report on Form 8-K filed January 26, 2022. 44 3.9 Certificate of Correction of the Certificate of Amendment of the Amended and Restated Certificate of Incorporation, filed with the Secretary of State of the State of Delaware on February 3, 2022, which was filed as Exhibit 3.1 to our Current Report on Form 8-K filed February 9, 2022. 4.1 Specimen Common Stock Certificate, which was filed as Exhibit 4.3 to Amendment No. 1 to Registration Statement on Form SB-2/A (Registration No. 333-48040) on September 23, 1996. 4.2 Common Stock Purchase Warrant issued on June 6, 2018 to L2 Capital, LLC, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on June 12, 2018. 4.3 Common Stock Purchase Warrant issued on June 15, 2018 to Strome Mezzanine Fund LP, which was filed as Exhibit 10.4 to our Current Report on Form 8-K filed on June 21, 2018. 4.4 Form of Common Stock Purchase Warrant issued on October 18, 2018, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on October 24, 2018. 4.5 Form of Warrant for Channel Partners Program, which was filed as Exhibit 4.3 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2016. 4.6 Form of MDB Warrant issued in connection with the Share Exchange Agreement, which was filed as Exhibit 10.3 to our Current Report on Form 8-K, filed on November 7, 2016. 4.7 Common Stock Purchase Warrant (exercise price $0.42 per share), dated June 14, 2019, issued to ABG-SI LLC, which was filed as Exhibit 4.16 to our Annual Report on Form 10-K, filed on August 16, 2021. 4.8 Common Stock Purchase Warrant (exercise price $0.84 per share), dated June 14, 2019, issued to ABG-SI LLC, which was filed as Exhibit 4.17 to our Annual Report on Form 10-K filed on January 8, 2021. 4.9 Form of 2019 Warrant for Channel Partners Program, which was filed as Exhibit 4.18 to our Annual Report on Form 10-K filed on April 9, 2021. 4.10 Form of 2020 Warrant for Channel Partners Program, which was filed as Exhibit 4.19 to our Annual Report on Form 10-K filed on April 9, 2021. 4.18 Rights Agreement, dated as of May 4, 2021, between the Company and American Stock Transfer & Trust Company, LLC, as Rights Agent, which includes the Form of Certificate of Designations, the Form of Right Certificate, and the Summary of Rights to Purchase Preferred Shares attached thereto as Exhibits A, B, and C, respectively, which was filed as Exhibit 4.1 to our Current Report on Form 8-K filed on May 4, 2021. 4.19* Description of Securities. 10.1 Securities Purchase Agreement, dated January 4, 2018, by and between the Company and certain investors named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 5, 2018. 10.2 Registration Rights Agreement, dated January 4, 2018, by and between the Company and certain investors named therein, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on January 5, 2018. 10.3 Securities Purchase Agreement, dated March 30, 2018, by and among the Company and certain investors named therein, which was filed as Exhibit 10.11 to our Annual Report on Form 10-K filed on January 8, 2021. 10.4 Registration Rights Agreement, dated March 30, 2018, by and among the Company and certain investors named therein, which was filed as Exhibit 10.12 to our Annual Report on Form 10-K filed on January 8, 2021. 10.5 Securities Purchase Agreement, dated June 15, 2018, between the Company and each purchaser named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on June 21, 2018. 10.6 Registration Rights Agreement, dated June 15, 2018, by and between the Company and each purchaser named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on June 21, 2018. 10.7 Form of Securities Purchase Agreement, dated as of August 9, 2018, by and between the Company and each purchaser named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on August 10, 2018. 10.8 Form of Registration Rights Agreement, dated as of August 9, 2018, by and between the Company and each purchaser named therein, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on August 10, 2018. 10.9 Securities Purchase Agreement, dated October 18, 2018, by and between the Company and each investor named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 24, 2018. 45 10.10 Securities Purchase Agreement, dated December 12, 2018, by and between the Company and each investor named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on December 13, 2018. 10.11 Registration Rights Agreement, dated December 12, 2018, by and between the Company and each investor named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on December 13, 2018. 10.12 Securities Purchase Agreement, dated March 18, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 22, 2019. 10.13 Registration Rights Agreement, dated March 18, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on March 22, 2019. 10.14 Securities Purchase Agreement, dated March 27, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 28, 2019. 10.15 Registration Rights Agreement, dated March 27, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on March 28, 2019. 10.16 Securities Purchase Agreement, dated April 8, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on April 12, 2019. 10.17 Registration Rights Agreement, dated April 8, 2019, by and between the Company and each investor named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on April 12, 2019. 10.18 Pledge and Security Agreement, dated June 10, 2019, by and among the Company, Maven Coalition, Inc., HubPages, Inc., Say Media, Inc., TST Acquisition Co., Inc., and the investor named therein, which was filed as Exhibit 10.5 to our Current Report on Form 8-K filed on June 12, 2019. 10.19 Confirmation and Ratification Agreement, dated June 14, 2019, by and among the Company, Maven Coalition, Inc., HubPages, Inc., Say Media, Inc., TST Acquisition Co., Inc., and the investor named therein, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on June 19, 2019. 10.20 Form of Securities Purchase Agreement, dated as of June 28, 2019, by and among the Company and each of the several purchasers named thereto, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on July 3, 2019. 10.21 Form of Registration Rights Agreement, dated as of June 28, 2019, by and among the Company and each of the several purchasers named thereto, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on July 3, 2019. 10.22 Form of Second Amended and Restated Promissory Note due June 14, 2022, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on September 3, 2019. 10.23 Form of Securities Purchase Agreement, dated as of October 7, 2019, by and among the Company and each of the several purchasers named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 11, 2019. 10.24 Form of Registration Rights Agreement, dated as of October 7, 2019, by and among the Company and each of the several purchasers named therein, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on October 11, 2019. 10.25 Second Amended and Restated Note Purchase Agreement, dated as of March 24, 2020, by and among the Company, Maven Coalition, Inc., TheStreet, Inc. Maven Media Brands, LLC, the agent and the purchaser, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 30, 2020. 10.26 Form of 15% Delayed Draw Term Note, issued on March 24, 2020, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on March 30, 2020. 10.27 Form of Series H Securities Purchase Agreement, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on August 20, 2020. 10.28 Form of Series J Securities Purchase Agreement, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on September 9, 2020. 10.29 Form of Series J Registration Rights Agreement, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on September 9, 2020. 10.30 Form of Series K Securities Purchase Agreement by and among the Company and each of the several purchasers named therein, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 28, 2020. 10.31 Form of Series K Registration Rights Agreement by and among the Company and each of the several purchasers named therein, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on October 28, 2020. 46 10.32 Amendment No. 1 to Second Amended and Restated Note Purchase Agreement, dated October 23, 2020, among the Company, the guarantors from time to time party thereto, each of the purchasers named therein, and BRF Financial Co., LLC, in its capacity as agent for the purchasers, which was filed as Exhibit 10.3 to our Current Report on Form 8-K filed on October 28, 2020. 10.33 Sublease, dated January 14, 2020, by and between Saks & Company LLC and Maven Coalition, Inc., which was filed as Exhibit 10.51 to our Annual Report on Form 10-K filed on August 16, 2021. 10.34 Office Lease Agreement, dated October 25, 2019, by and between Street Retail West I, LP and the Company, which was filed as Exhibit 10.54 to our Annual Report on Form 10-K filed on August 16, 2021. 10.35 Asset Purchase Agreement, dated March 9, 2020, by and among Maven Coalition, Inc., Petametrics Inc., doing business as LiftIgniter, and the Company, which was filed as Exhibit 10.59 to our Annual Report on Form 10-K filed on August 16, 2021. 10.36+ Consulting Agreement, dated August 26, 2020, by and between Maven Coalition, Inc. and James C. Heckman, Jr., which was filed as Exhibit 10.62 to our Annual Report on Form 10-K filed on January 8, 2021. 10.37+ Separation Agreement, effective as of September 2, 2020, by and between the Company and James C. Heckman, Jr., which was filed as Exhibit 10.61 to our Annual Report on Form 10-K filed on August 16, 2021. 10.38+ Form of Stock Option Award Agreement – 2016 Stock Incentive Plan, which was filed as Exhibit 10.62 to our Annual Report on Form 10-K filed on August 16, 2021. 10.39+ Form of Stock Option Award Agreement – 2019 Equity Incentive Plan, which was filed as Exhibit 10.63 to our Annual Report on Form 10-K filed on August 16, 2021. 10.40+ Independent Director Agreement, effective as of September 3, 2018, by and between the Company and Todd D. Sims, which was filed as Exhibit 10.71 to our Annual Report on Form 10-K filed on August 16, 2021. 10.41+ First Amendment to the 2016 Stock Incentive Plan, which was filed as Exhibit 10.80 to our Annual Report on Form 10-K filed on August 16, 2021. 10.42+ Second Amendment to the 2016 Stock Incentive Plan, which was filed as Exhibit 10.81 to our Annual Report on Form 10-K filed on August 16, 2021. 10.43+ Form of Restricted Equity Award Grant Notice – 2019 Equity Incentive Plan, which was filed as Exhibit 10.82 to our Annual Report on Form 10-K filed on August 16, 2021. 10.44+ Form of Restricted Stock Unit Grant Notice – 2019 Equity Incentive Plan, which was filed as Exhibit 10.83 to our Annual Report on Form 10-K filed on August 16, 2021. 10.45+ Stock Option Award Agreement, dated March 11, 2019, by and between the Company and Douglas B. Smith, which was filed as Exhibit 10.84 to our Annual Report on Form 10-K filed on August 16, 2021. 10.46+ Stock Option Award Agreement, dated March 11, 2019, by and between the Company and Douglas B. Smith, which was filed as Exhibit 10.85 to our Annual Report on Form 10-K filed on August 16, 2021. 10.47 Channel Partners Warrant Program adopted on May 20, 2020, which was filed as Exhibit 10.112 to our Annual Report on Form 10-K filed on April 9, 2021. 10.48+ 2020 Outside Director Compensation Policy, adopted as of January 1, 2020, which was filed as Exhibit 10.113 to our Annual Report on Form 10-K filed on April 9, 2021. 47 10.49+ Amendment to 2020 Outside Director Compensation Policy, dated May 27, 2020, which was filed as Exhibit 10.114 to our Annual Report on Form 10-K filed on April 9, 2021. 10.50+ Stock Option Award Agreement, dated January 16, 2019, by and between the Company and Andrew Q. Kraft, which was filed as Exhibit 10.119 to our Annual Report on Form 10-K filed on April 9, 2021. 10.51+ Stock Award Agreement, dated January 16, 2019, by and between the Company and Andrew Q. Kraft, which was filed as Exhibit 10.120 to our Annual Report on Form 10-K filed on April 9, 2021. 10.52+ Maven Executive Bonus Plan, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 14, 2021. 10.53 Amendment No. 1 to Agreement and Plan of Merger, dated July 12, 2019, by and among the Company, TheStreet, Inc., and TST Acquisition Co., Inc., which was filed as Exhibit 10.122 to our Annual Report on Form 10-K filed on April 9, 2021. 10.54+ Executive Employment Agreement, effective January 1, 2021, by and between the Company and Paul Edmondson, which was filed as Exhibit 10.4 to our Current Report on Form 8-K on February 23, 2021. 10.55+ Amended and Restated Executive Employment Agreement, effective January 1, 2021, by and between the Company and Douglas B. Smith, which was filed as Exhibit 10.2 to our Current Report on Form 8-K on February 23, 2021. 10.56+ Stock Option Grant Notice, dated April 10, 2019, by and between the Company and Paul Edmondson, which was filed as Exhibit 10.127 to our Annual Report on Form 10-K filed on April 9, 2021. 10.57+ Stock Option Grant Notice, dated April 10, 2019, by and between the Company and James Heckman, which was filed as Exhibit 10.128 to our Annual Report on Form 10-K filed on April 9, 2021. 10.58+ Stock Option Grant Notice, dated April 10, 2019, by and between the Company B. Rinku Sen, which was filed as Exhibit 10.129 to our Annual Report on Form 10-K filed on April 9, 2021. 10.59+ Stock Option Grant Notice, dated April 10, 2019, by and between the Company and Douglas Smith, which was filed as Exhibit 10.130 to our Annual Report on Form 10-K filed on April 9, 2021. 10.60+ Form of Amendment to Stock Option Award Agreement, by and between the Company and certain grantees awarded stock options on April 10, 2019, which was filed as Exhibit 10.131 to our Annual Report on Form 10-K filed on April 9, 2021. 10.61+ Executive Employment Agreement, effective as of January 1, 2021, by and between the Company and Jill Marchisotto, which was filed as Exhibit 10.5 to our Current Report on Form 8-K on February 23, 2021. 10.62+ Executive Employment Agreement, effective as of February 18, 2021, by and between the Company and Robertson Barrett, which was filed as Exhibit 10.3 to our Current Report on Form 8-K on February 23, 2021. 10.63 Services Agreement, dated as of December 22, 2020, by and between the Company and Whisper Advisors, LLC, which was filed as Exhibit 10.134 to our Annual Report on Form 10-K on April 9, 2021. 10.64+ Stock Option Award Agreement, dated September 14, 2018, by and between the Company and Paul Edmondson, which was filed as Exhibit 10.135 to our Annual Report on Form 10-K on April 9, 2021. 10.65+ Stock Option Award Agreement, dated September 14, 2018, by and between the Company and James Heckman, which was filed as Exhibit 10.136 to our Annual Report on Form 10-K on April 9, 2021. 10.66+ Amended and Restated Executive Employment Agreement, effective January 1, 2021, by and between the Company and Andrew Kraft, which was filed as Exhibit 10.6 to our Current Report on Form 8-K on February 23, 2021. 10.67+ Second Amended and Restated Executive Employment Agreement, effective January 1, 2021, by and between the Company and Avi Zimak, which was filed as Exhibit 10.7 to our Current Report on Form 8-K on February 23, 2021. 10.68+ Second Amendment to theMaven, Inc.’s 2019 Equity Incentive Plan, dated February 18, 2021, which was filed as Exhibit 10.1 to our Current Report on Form 8-K on February 24, 2021. 10.69+ First Amendment to theMaven, Inc.’s 2019 Equity Incentive Plan, dated March 16, 2020, which was filed as Exhibit 10.141 to our Annual Report on Form 10-K on April 9, 2021. 10.70+ 2019 Equity Incentive Plan, which was filed as Exhibit 10.142 to our Annual Report on Form 10-K on April 9, 2021. 10.71 2016 Stock Incentive Plan, which was filed as Exhibit 4.4 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2016. 10.72 Financing and Security Agreement, dated February 2020, by and among Maven Coalition, Inc., theMaven, Inc., Maven Media Brands, LLC, TheStreet, Inc., and FPP Finance LLC, which was filed as Exhibit 10.8 to our Quarterly Report on Form 10-Q on May 7, 2021. 10.73 First Amendment to Financing and Security Agreement, dated March 24, 2020, by and among Maven Coalition, Inc., theMaven, Inc., Maven Media Brands, LLC, TheStreet, Inc., and FPP Financing LLC, which was filed as Exhibit 10.9 to our Quarterly Report on Form 10-Q on May 7, 2021. 48 10.74 Intercreditor Agreement, dated February 24, 2020, by and between FPP Finance LLC and BRF Finance Co., LLC, which was filed as Exhibit 10.10 to our Quarterly Report on Form 10-Q on May 7, 2021. 10.75 Amendment No. 1 to Intercreditor Agreement, dated March 24, 2020, by and between FPP Finance LLC and BRF Finance Co., LLC, which was filed as Exhibit 10.11 to our Quarterly Report on Form 10-Q on May 7, 2021. 10.76 Amendment No. 2 to Second Amended and Restated Note Purchase Agreement, dated as of May 19, 2021, by and among the Company, Maven Coalition, Inc., TheStreet, Inc., Maven Media Brands, LLC, and the Agent, and the Purchaser, which was filed as Exhibit 10.1 to our Current Report on Form 8-K on May 25, 2021. 10.77 Form of Securities Purchase Agreement among the Company and each of the several purchasers signatory thereto, which was filed as Exhibit 10.2 to our Current Report on Form 8-K on May 25, 2021. 10.78 Form of Registration Rights Agreement among the Company and each of the several purchasers signatory thereto, which was filed as Exhibit 10.3 to our Current Report on Form 8-K on May 25, 2021. 10.79 Stock Purchase Agreement, dated June 4, 2021, by and among the Company, Maven Media Brands, LLC, College Spun Media Incorporated, Matthew Lombardi, Alyson Shontell Lombardi, Timothy Ray, Andrew Holleran, and the Representative, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on June 7, 2021. 10.80 Amended Consulting Agreement, dated June 3, 2021, by and between the Company, Maven Coalition, Inc., and James C. Heckman Jr., which was filed as Exhibit 10.103 to our Registration Statement on Form S-1 filed on October 29, 2021. 10.81 General Release and Continuing Obligations Agreement, dated June 3, 2021, by and between the Company, Maven Coalition, Inc., Maven Media Brands, LLC, TheStreet Inc., Heckman Media, LLC, and James C. Heckman Jr., which was filed as Exhibit 10.104 to our Registration Statement on Form S-1 filed on October 29, 2021. 10.82+ Amendment to 2016 Stock Incentive Plan Option Agreement, dated June 3, 2021, by and between the Company and James C. Heckman Jr., which was filed as Exhibit 10.105 to our Registration Statement on Form S-1 filed on October 29, 2021. 10.83+ Amendment to 2019 Equity Incentive Plan Option Agreement, dated June 3, 2021, by and between the Company and James C. Heckman Jr., which was filed as Exhibit 10.106 to our Registration Statement on Form S-1 filed on October 29, 2021. 10.84+ Executive Employment Agreement by and between the Company and Spiros Christoforatos, dated October 4, 2021, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 18, 2021. 10.85 Second Amended and Restated Executive Employment Agreement, effective August 26, 2020, by and between the Company and Ross Levinsohn, which was filed as Exhibit 10.1 to our Current Report on Form 8-K on February 23, 2021. 10.86 Third Amendment to Financing and Security Agreement, dated as of December 6, 2021, by and among theMaven, Inc., Maven Coalition, Inc., Maven Media Brands, LLC, TheStreet, Inc., College Spun Media Incorporated, and Fast Pay Partners LLC, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on December 10, 2021. 10.87 Amendment No. 3 to Second Amended and Restated Note Purchase Agreement, dated as of December 6, 2021, by and among theMaven, Inc., Maven Coalition, Inc., TheStreet, Inc., Maven Media Brands, LLC, College Spun Media Incorporated, and BRF Finance Co., LLC, as Agent and Purchaser, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on December 10, 2021. 10.88+ Amendment No. 1 to Second Amended & Restated Executive Employment Agreement, dated as of December 22, 2021, by and between the Company and Ross Levinsohn, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on January 10, 2022. 10.89+ Bonus Letter, dated as of October 6, 2021, by and between the Company and Ross Levinsohn, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 10, 2022. 10.90 Form of Stock Purchase Agreement by and between the Company and certain investors, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 28, 2022. 10.91 Amendment No. 4 to Second Amended and Restated Note Purchase Agreement, dated January 23, 2022, by and between theMaven, Inc., Maven Coalition, Inc., TheStreet, Inc., Maven Media Brands, LLC, College Spun Media Incorporated, and BRF Finance Co., LLC, as Agent and Purchaser, which was filed as Exhibit 10.2 to our Current Report on Form 8-K filed on January 28, 2022. 49 10.92 Exchange Agreement, dated October 31, 2020, by and between the Company and James C. Heckman, which was filed as Exhibit 10.125 to our Annual Report on Form 10-K filed on April 9, 2021. 10.93+ Letter Agreement between the Company and Joshua Jacobs, effective as of March 9, 2021, which was filed as Exhibit 10.1 to our Current Report on Form 8-K on March 12, 2021. 10.94+ Restricted Stock Award Grant Notice, effective March 9, 2021, by and between the Company and Eric Semler, which was filed as Exhibit 10.144 to our Annual Report on Form 10-K on April 9, 2021. 10.95 Underwriting Agreement, dated February 10, 2022, between The Arena Group Holdings, Inc. and B. Riley Securities, Inc., as representative of the several underwriters, which was filed as Exhibit 1.1 to our Current Report on Form 8-K filed on February 11, 2022. 10.96 Asset Purchase Agreement between the Company and Fulltime Fantasy Sports, LLC, dated July 15, 2021, which was filed as Exhibit 10.5 to our Quarterly Report on Form 10-Q on November 15, 2021. 14.1 Amended and Restated Business Code of Ethics and Conduct, which was filed as Exhibit 14.1 to our Annual Report on Form 10-K filed on August 16, 2021. 14.2 Code of Ethics for Financial Officers, which was filed as Exhibit 14.2 to our Annual Report on Form 10-K filed on August 16, 2021. 21.1* Subsidiaries. 31.1* Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. 31.2* Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. 32.1* Certification of Chief Executive Officer pursuant to Section 1350 of the Sarbanes-Oxley Act of 2002. 32.2* Certification of Chief Financial Officer pursuant to Section 1350 of the Sarbanes-Oxley Act of 2002. 101.INS Inline XBRL* Instance Document. 101.SCH Inline XBRL* Taxonomy Extension Schema Document. 101.CAL Inline XBRL* Taxonomy Extension Calculation Linkbase Document. 101.DEF Inline XBRL* Taxonomy Extension Definition Linkbase Document. 101.LAB Inline XBRL* Taxonomy Extension Label Linkbase Document. 101.PRE Inline XBRL* Taxonomy Presentation Linkbase Document. 104* Cover Page Interactive Data (embedded within the Inline XBRL document and contained in Exhibit 101) * Filed Herewith + Employment Agreement (b) Exhibits. See Item 15(a) above. Item 16. Form 10–K Summary None. 50 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. The Arena Group Holdings, Inc. Dated: March 31, 2022 By: /s/ ROSS LEVINSOHN Ross Levinsohn Chief Executive Officer and Chairman of the Board (Principal Executive Officer) By: /s/ DOUGLAS B. SMITH Douglas B. Smith Chief Financial Officer (Principal Financial Officer) By: /s/ SPIROS CHRISTOFORATOS Spiros Christoforatos Chief Accounting Officer (Principal Accounting Officer) Power of Attorney KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Ross Levinsohn and Douglas B. Smith, jointly and severally, as his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the U.S. Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated and on the dates indicated. Signature Title /s/ ROSS LEVINSOHN Chief Executive Officer and Chairman of the Board Ross Levinsohn (Principal Executive Officer) Date: March 31, 2022 /s/ DOUGLAS B. SMITH Chief Financial Officer Douglas B. Smith (Principal Financial Officer) Date: March 31, 2022 /s/ SPIROS CHRISTOFORATOS Chief Accounting Officer Spiros Christoforatos (Principal Accounting Officer) Date: March 31, 2022 /s/ H. HUNT ALLRED Director Daniel Shribman Date: March 31, 2022 /s/ CARLO ZOLA Director Carlo Zola Date: March 31, 2022 /s/ CHRISTOPHER PETZEL Director Christopher Petzel Date: March 31, 2022 /s/ LAURA LEE Director B. Laura Lee Date: March 31, 2022 /s/ DANIEL SHRIBMAN Director Daniel Shribman Date: March 31, 2022 /s/ TODD D. SIMS Director Todd D. Sims Date: March 31, 2022 51 The Arena Group Holdings, Inc. and Subsidiaries Index to Consolidated Financial Statements PAGE Report of Independent Registered Public Accounting Firm (PCAOB ID NO: 688 ) F-2 Consolidated Balance Sheets as of December 31, 2021 and 2020 F-4 Consolidated Statements of Operations for the Years Ended December 31, 2021 and 2020 F-5 Consolidated Statements of Stockholders’ Deficiency for the Years Ended December 31, 2021 and 2020 F-6 Consolidated Statements of Cash Flows for the Years Ended December 31, 2021 and 2020 F-7 Notes to Consolidated Financial Statements F-8 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholder and Board of Directors of The Arena Group Holdings, Inc. and Subsidiaries (formerly known as theMaven, Inc.) Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of The Arena Group Holdings, Inc. and Subsidiaries (formerly known as theMaven, Inc.) the “Company”) as of December 31, 2021 and 2020, the related consolidated statements of operations, stockholders’ deficiency and cash flows for each of the two years in the period ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021 and 2020, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. F- 2 Evaluation of the Contract Modification to Certain Subscription Contacts As described in Note 2 to the consolidated financial statements, the Company modified certain digital and magazine subscription contracts in January 2020, February 2020 and December 2021 to reflect changes in the number of copies of future magazines to be published on a yearly basis. The Company determined that these subscription contract modifications are distinct from the original contract which in effect establishes a new contract with each individual subscriber. The Company accounted for the subscription contract modification on a prospective basis. We evaluated the impact of the subscription contract modification as a critical audit matter as there is significant judgment by management in determining the revenues to be recognized in future periods. For the year ended December 31, 2021, the Company recognized $2.8 million of revenues resulting from the subscription contract modifications. To address this matter required performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. The primary procedures included, amongst others, (i) testing the future earnings to be recognized on a prospective basis (ii) confirming the number of future unserved subscription copies at the subscription contract modification dates and (iii) testing management’s analysis of the financial impact of the contract modification to current period earnings. Evaluation of acquisition-date fair value of the brand name intangible asset As discussed in Note 3 to the consolidated financial statements, the Company acquired College Spun Media Incorporated (“The Spun”) on June 4, 2021 for a purchase price of $11.8 million. In connection with the transaction, the Company recorded an intangible asset related to the acquired brand name for $5.2 million. We identified and evaluated the acquisition-date fair value of the brand name acquired in the transaction as a critical audit matter. This critical audit matter required a degree of subjectivity in calculating its fair value. A discounted cash flow model included internally-developed assumptions with limited observable market information was used to calculate the value and was sensitive to possible changes to key assumptions, including: (i) forecasted revenue growth rates, (ii) forecasted earnings before interest, tax, depreciation, and amortization (EBITDA) margins and (iii) weighted-average cost of capital (WACC), including the discount rate. The primary procedures we performed to address this critical audit matter included evaluating the Company’s forecasted revenue growth rates by comparing the forecasted growth to The Spun’s historical and actual results to assess The Spun’s ability to accurately forecast. In addition, we involved a valuation specialist to assist with (i) evaluating the valuation approach used by the Company to calculate the fair value of the brand name and (ii) assessing the Company’s WACC calculation, by comparing it against an independently estimated WACC. /s/ Marcum llp Marcum LLP We have served as the Company’s auditor since 2019. Los Angeles, California March 31, 2022 F- 3 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS 2021 2020 As of December 31, 2021 2020 Assets Current assets: Cash and cash equivalents $ 9,349,020 $ 9,033,872 Restricted cash 501,780 500,809 Accounts receivable, net 21,659,847 16,497,626 Subscription acquisition costs, current portion 30,162,524 28,146,895 Royalty fees, current portion 11,250,000 15,000,000 Prepayments and other current assets 4,747,847 4,667,263 Total current assets 77,671,018 73,846,465 Property and equipment, net 635,768 1,129,438 Operating lease right-of-use assets 528,431 18,292,196 Platform development, net 9,298,795 7,355,608 Royalty fees, net of current portion - 11,250,000 Subscription acquisition costs, net of current portion 8,234,553 13,358,585 Acquired and other intangible assets, net 57,356,497 71,501,835 Other long-term assets 639,151 1,330,812 Goodwill 19,618,667 16,139,377 Total assets $ 173,982,880 $ 214,204,316 Liabilities, mezzanine equity and stockholders’ deficiency Current liabilities: Accounts payable $ 11,981,852 $ 8,228,977 Accrued expenses and other 24,010,569 14,718,193 Line of credit 11,988,194 7,178,791 Unearned revenue 54,029,657 61,625,676 Subscription refund liability 3,086,799 4,035,531 Operating lease liabilities 373,859 1,059,671 Liquidated damages payable 5,197,182 9,568,091 Current portion of long-term debt 5,744,303 - Embedded derivative liabilities - 1,147,895 Total current liabilities 116,412,415 107,562,825 Unearned revenue, net of current portion 15,275,892 23,498,597 Restricted stock liabilities, net of current portion - 1,995,810 Operating lease liabilities, net of current portion 785,320 19,886,083 Liquidating damages payable, net of current portion 7,008,273 - Other long-term liabilities 7,556,265 753,365 Deferred tax liabilities 362,118 210,832 Long-term debt, net of current portion 64,372,511 62,194,272 Total liabilities 211,772,794 216,101,784 Commitments and contingencies (Note 27) - Mezzanine equity: Series G redeemable and convertible preferred stock, $ 0.01 par value, $ 1,000 per share liquidation value and 1,800 shares designated; aggregate liquidation value: $ 168,496 ; Series G shares issued and outstanding: 168.496 ; common shares issuable upon conversion: 8,582 at December 31, 2021 and 2020 168,496 168,496 Series H convertible preferred stock, $ 0.01 par value, $ 1,000 per share liquidation value and 23,000 shares designated; aggregate liquidation value: $ 15,066,000 and $ 19,596,000 ; Series H shares issued and outstanding: 15,066 and 19,596 ; common shares issuable upon conversion: 2,075,200 and 2,699,312 at December 31, 2021 and 2020, respectively 13,717,496 18,247,496 Total mezzanine equity 13,885,992 18,415,992 Stockholders’ deficiency: Common stock, $ 0.01 par value, authorized 1,000,000,000 shares: issued and outstanding; 12,632,947 and 10,412,965 shares December 31, 2021 and 2020, respectively 126,329 104,129 Common stock to be issued 491 491 Additional paid-in capital 200,410,213 141,855,206 Accumulated deficit ( 252,212,939 ) ( 162,273,286 ) Total stockholders’ deficiency ( 51,675,906 ) ( 20,313,460 ) Total liabilities, mezzanine equity and stockholders’ deficiency $ 173,982,880 $ 214,204,316 See accompanying notes to consolidated financial statements. F- 4 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS 2021 2020 Years Ended December 31, 2021 2020 Revenue $ 189,140,334 $ 128,032,397 Cost of revenue (includes amortization for developed technology and platform development for 2021 and 2020 of $ 8,829,025 and $ 8,550,952 , respectively) 110,977,736 103,063,445 Gross profit 78,162,598 24,968,952 Operating expenses Selling and marketing 82,691,061 43,589,239 General and administrative 54,400,720 36,007,238 Depreciation and amortization 16,347,274 16,280,475 Loss on disposition of assets 1,192,310 279,133 Loss on impairment of lease 466,356 - Loss on termination of lease 7,344,655 - Total operating expenses 162,442,376 96,156,085 Loss from operations ( 84,279,778 ) ( 71,187,133 ) Other (expenses) income Change in valuation of warrant derivative liabilities 34,492 496,305 Change in valuation of embedded derivative liabilities - 2,571,004 Loss on conversion of convertible debt - ( 3,297,539 ) Interest expense ( 10,454,618 ) ( 16,497,217 ) Interest income 6,484 381,026 Liquidated damages ( 2,637,364 ) ( 1,487,577 ) Gain upon debt extinguishment 5,716,697 - Total other expenses ( 7,334,309 ) ( 17,833,998 ) Loss before income taxes ( 91,614,087 ) ( 89,021,131 ) Income tax benefit (provision) 1,674,434 ( 210,832 ) Net loss ( 89,939,653 ) ( 89,231,963 ) Deemed dividend on convertible preferred stock - ( 15,642,595 ) Net loss attributable to common stockholders $ ( 89,939,653 ) $ ( 104,874,558 ) Basic and diluted net loss per common share $ ( 7.87 ) $ ( 50.18 ) Weighted average number of common shares outstanding – basic and diluted 11,429,740 2,090,047 See accompanying notes to consolidated financial statements. F- 5 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIENCY Years Ended December 31, 2021 and 2020 Common Stock Common Stock to be Issued Additional Total Shares Par Value Shares Par Value Paid-in Capital Accumulated Deficit Stockholders’ Deficiency Balance at January 1, 2020 1,687,233 $ 16,872 179,014 $ 1,790 $ 35,954,677 $ ( 73,041,323 ) $ ( 37,067,984 ) Issuance of restricted stock units in connection with the acquisition of LiftIgniter - - - - 500,000 - 500,000 Issuance of common stock in connection with the merger of Say Media 129,880 1,299 ( 129,880 ) ( 1,299 ) - - - Forfeiture of restricted stock ( 18,182 ) ( 182 ) - - 182 - - Issuance of restricted stock awards to the board of directors 25,569 256 - - ( 256 ) - - Issuance of common stock upon conversion of 12% convertible debentures 2,449,431 24,494 - - 21,377,994 - 21,402,488 Issuance of common stock upon conversion of related embedded derivative liabilities of 12% convertible debentures - - - - 10,929,996 - 10,929,996 Issuance of common stock upon conversion of Series H convertible preferred stock 41,323 413 - - 299,587 - 300,000 Issuance of common stock upon conversion of Series I convertible preferred stock 2,100,000 21,000 - - 24,760,742 - 24,781,742 Issuance of common stock upon conversion of Series J convertible preferred stock 1,981,114 19,811 - - 24,306,730 - 24,326,541 Issuance of common stock upon conversion of Series K convertible preferred stock 2,050,228 20,502 - - 26,933,048 - 26,953,550 Reclassification of restricted stock awards and units from equity to liability classified upon modification - - - - ( 3,800,734 ) - ( 3,800,734 ) Common stock withheld for taxes ( 33,947 ) ( 339 ) - - ( 520,105 ) - ( 520,444 ) Exercise of common stock options 316 3 - - 3,764 - 3,767 Deemed dividend on Series I convertible preferred stock - - - - ( 5,082,000 ) - ( 5,082,000 ) Deemed dividend on Series J convertible preferred stock - - - - ( 586,545 ) - ( 586,545 ) Deemed dividend on Series K convertible preferred stock - - - - ( 9,472,050 ) - ( 9,472,050 ) Beneficial conversion feature on Series H convertible preferred stock - - - - 502,000 - 502,000 Deemed dividend on Series H convertible preferred stock - - - - ( 502,000 ) - ( 502,000 ) Stock-based compensation - - - - 16,250,176 - 16,250,176 Net loss - - - - - ( 89,231,963 ) ( 89,231,963 ) Balance at December 31, 2020 10,412,965 104,129 49,134 491 141,855,206 ( 162,273,286 ) ( 20,313,460 ) Issuance of restricted stock awards to the board of directors 48,856 489 - - ( 489 ) - - Repurchase restricted stock classified as liabilities ( 22,178 ) ( 222 ) - - 222 - - Issuance of common stock for restricted stock units in connection with the acquisition of LiftIgniter 11,667 117 - - ( 117 ) - - Issuance of common stock in connection with professional services 14,205 142 - - 124,858 - 125,000 Issuance of restricted stock in connection with the acquisition of The Spun 194,806 1,948 - - ( 1,948 ) - - Net exercise of common stock options with exchange of common stock 3,858 39 - - ( 39 ) - - Common stock withheld for taxes ( 4,355 ) ( 44 ) - - ( 70,194 ) - ( 70,238 ) Issuance of common stock in connection with private placement 1,299,027 12,990 - - 19,824,767 - 19,837,757 Issuance of common stock upon conversion of Series H convertible preferred stock 624,111 6,241 - - 4,523,759 - 4,530,000 Issuance of restricted stock in connection with the acquisition of Fulltime Fantasy 34,092 341 - - 502,159 - 502,500 Issuance of common stock upon vesting of restricted stock units 22,728 227 - - ( 227 ) - - Forfeiture of unvested restricted stock awards ( 6,835 ) ( 68 ) - - 68 - - Reclassification of warrants to equity - - - - 1,113,403 - 1,113,403 Stock-based compensation - - - - 32,538,785 - 32,538,785 Net loss - - - - - ( 89,939,653 ) ( 89,939,653 ) Balance at December 31, 2021 12,632,947 $ 126,329 49,134 $ 491 $ 200,410,213 $ ( 252,212,939 ) $ ( 51,675,906 ) See accompanying notes to consolidated financial statements. F- 6 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS 2021 2020 Years Ended December 31, 2021 2020 Cash flows from operating activities Net loss $ ( 89,939,653 ) $ ( 89,231,963 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation of property and equipment 443,422 638,796 Amortization of platform development and intangible assets 24,732,877 24,192,631 Loss on disposition of assets 1,192,310 279,133 Loss on impairment of lease 466,356 - Loss on termination of lease 7,344,655 - Gain upon debt extinguishment ( 5,716,697 ) - Amortization of debt discounts 2,105,536 6,607,212 Change in valuation of warrant derivative liabilities ( 34,492 ) ( 496,305 ) Change in valuation of embedded derivative liabilities - ( 2,571,004 ) Loss on conversion of 12% convertible debentures - 3,297,539 Accrued and noncash converted interest 6,956,182 9,244,324 Liquidated damages 2,637,364 1,487,577 Stock-based compensation 30,493,521 14,641,181 Deferred income taxes ( 1,674,434 ) 210,832 Other ( 499,196 ) ( 524,418 ) Change in operating assets and liabilities net of effect of business combinations: Accounts receivable ( 2,891,000 ) 362,460 Subscription acquisition costs 3,108,403 ( 34,945,422 ) Royalty fees 15,000,000 15,000,000 Prepayments and other current assets 48,983 ( 356,528 ) Other long-term assets 691,661 ( 245,525 ) Accounts payable 3,752,875 ( 1,404,703 ) Accrued expenses and other 7,474,423 ( 3,392,507 ) Unearned revenue ( 15,818,724 ) 21,695,088 Subscription refund liability ( 948,732 ) 891,359 Operating lease liabilities ( 2,489,166 ) 1,814,601 Other long-term liabilities ( 1,165,863 ) 511,055 Net cash used in operating activities ( 14,729,389 ) ( 32,294,587 ) Cash flows from investing activities Purchases of property and equipment ( 376,635 ) ( 1,212,003 ) Capitalized platform development ( 4,818,866 ) ( 3,750,541 ) Proceeds from sale of intangible asset - 350,000 Payments for acquisition of businesses, net of cash ( 7,950,457 ) ( 315,289 ) Net cash used in investing activities ( 13,145,958 ) ( 4,927,833 ) Cash flows from financing activities Proceeds from long-term debt 5,086,135 11,702,725 Proceeds, net of repayments, under line of credit 4,809,403 7,178,791 Proceeds from common stock private placement 20,005,000 - Payment of debt issuance costs on long-term debt - ( 560,500 ) Proceeds from issuance of Series H convertible preferred stock - 113,000 Repayments of convertible debt - ( 1,130,903 ) Proceeds from exercise of common stock options - 3,767 Proceeds from issuance of Series J convertible preferred stock - 6,000,000 Proceeds from issuance of Series K convertible preferred stock - 14,675,000 Payments of issuance costs from common stock private placement ( 167,243 ) - Payment for taxes related to repurchase of restricted common stock ( 70,238 ) ( 520,444 ) Payment of restricted stock liabilities ( 1,471,591 ) ( 177,425 ) Net cash provided by financing activities 28,191,466 37,284,011 Net increase in cash, cash equivalents, and restricted cash 316,119 61,591 Cash, cash equivalents, and restricted cash – beginning of year 9,534,681 9,473,090 Cash, cash equivalents, and restricted cash – end of year $ 9,850,800 $ 9,534,681 Supplemental disclosure of cash flow information Cash paid for interest $ 1,392,900 $ 645,681 Cash paid for income taxes - - Noncash investing and financing activities Reclassification of stock-based compensation to platform development $ 2,045,264 $ 1,608,995 Issuance of common stock in connection with professional services 125,000 - Deferred cash payments in connection with acquisition of The Spun 905,109 - Assumption of liabilities in connection with acquisition of The Spun 84,732 - Commitment fee on delayed draw term note in accrued expenses and other 508,614 - Reclassification of warrants to equity 1,113,403 - Net exercise of common stock options with exchange of common stock 39 - Debt discount on long-term debt - 913,865 Restricted common stock units issued in connection with acquisition of LiftIgniter - 500,000 Assumption of liabilities in connection with acquisition of LiftIgniter - 140,381 Restricted stock issued in connection with acquisition of Fulltime Fantasy 502,500 - Deferred cash payments in connection with acquisition of Fulltime Fantasy 419,387 - Conversion of convertible debt into common stock - 21,402,488 Conversion of embedded derivative liabilities into common stock - 10,929,996 Conversion of Series I convertible preferred stock into common stock - 19,699,742 Conversion of Series J convertible preferred stock into common stock - 23,739,996 Conversion of Series K convertible preferred stock into common stock - 17,481,500 Deemed dividend on Series H convertible preferred stock - 502,000 Deemed dividend on Series I convertible preferred stock - 5,082,000 Deemed dividend on Series J convertible preferred stock - 586,545 Deemed dividend on Series K convertible preferred stock - 9,472,050 Payment of long-term debt for issuance of Series K convertible preferred stock - 3,367,000 Payment of promissory note for issuance for Series H convertible preferred stock - 389,000 See accompanying notes to consolidated financial statements. F- 7 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years Ended December 31, 2021 and 2020 1. Organization and Basis of Presentation Organization The Arena Holdings Group, Inc. (formerly known as TheMaven, Inc.) (“The Arena Group” or the “Company”), was incorporated in Delaware on October 1, 1990. On October 11, 2016, the predecessor entity now known as The Arena Group exchanged its shares with another entity that was incorporated in Delaware on July 22, 2016. On November 4, 2016, these entities consummated a recapitalization. This resulted in The Arena Group becoming the parent entity, and the other Delaware entity becoming the wholly owned subsidiary. On December 19, 2019, the Company’s wholly owned subsidiaries The Arena Platform, Inc. (formerly known as Maven Coalition, Inc.), and HubPages, Inc. (“HubPages”), a Delaware corporation that was acquired by the Company in a merger during 2018, were merged into another of the Company’s wholly owned subsidiaries, Say Media, Inc. (“Say Media”), a Delaware corporation that was acquired by the Company in a merger during 2018, with Say Media as the surviving corporation. On January 6, 2020, Say Media changed its name to The Arena Platform, Inc. (“Arena Platform”). As of December 31, 2021, the Company’s wholly owned subsidiaries consist of The Arena Platform, The Arena Media Brands, LLC (“Arena Media”) (formerly known as Maven Media Brands, LLC) formed during 2019 as a wholly owned subsidiary of The Arena Group), TheStreet, Inc. (“TheStreet” acquired by the Company in a merger during 2019) and College Spun Media Incorporated (“The Spun” acquired by the Company in a merger during 2021 as further described in Note 3). The Company changed its corporate name to The Arena Group Holdings, Inc. from TheMaven, Inc. to on February 8, 2022. The Company’s subsidiaries changed their corporate names to The Arena Platform, Inc. from Maven Coalition, Inc. and to The Arena Media Brands, LLC from Maven Media Brands, LLC on February 18, 2022. Unless the context indicates otherwise, The Arena Group, The Arena Platform, TheStreet and The Spun, are together hereinafter referred to as the “Company.” Reverse Stock Split On November 18, 2020, the Company’s stockholders holding more than a majority of the voting power of the Company approved the amendment to the Company’s Amended and Restated Certificate of Incorporation on November 24, 2020, to effect a reverse split of the common stock at a ratio to be determined by the board of directors (the “Board”) within certain parameters, and without reducing the authorized number of shares of common stock. On February 8, 2022, the Company’s Board approved a one-for-twenty-two (1-for-22) reverse stock split of its outstanding shares of common stock that was effective at 8:00 p.m. Eastern Time on February 8, 2022 and began trading on the NYSE American (the “NYSE American”) on February 9, 2022 (as further described below). At the effective time, every twenty-two shares of issued and outstanding common stock were automatically combined into one issued and outstanding share of common stock, without any change in the number of authorized shares. No fractional shares were issued as a result of the reverse stock split. Any fractional shares that would otherwise have resulted from the reverse stock split were rounded up to the next whole number. The accompanying financial statements and notes to the financial statements give effect to the reverse stock split for all periods presented. The shares of common stock retained a par value of $ 0.01 per share. Accordingly, stockholders’ deficiency reflects the reverse stock split by reclassifying from “common stock” to “additional paid-in capital” in an amount equal to the par value of the decreased shares resulting from the reverse stock split. In addition, any fractional shares that would otherwise be issued as a result of the reverse stock split were rounded up to the nearest whole share. In connection with the reverse stock split, proportionate adjustments were made to increase the per share exercise prices and decrease the number of shares of common stock issuable upon exercise of common stock options and warrants whereby approximately the same aggregate price is required to be paid for such securities upon exercise as had been payable immediately preceding the reverse stock split. In addition, any fractional shares that would otherwise be issued as a result of the reverse stock split were rounded up to the nearest whole share. F- 8 On February 9, 2022, in connection with the Company’s name change and reverse stock split, the Company up-listed its common stock to the NYSE American, which began trading on February 9, 2022 under the symbol “AREN.” A notice of corporate action was filed with the Financial Industry Regulatory Authority (“FINRA”), requesting approval to change the Company’s corporate name and trading symbol, and to effect the reverse stock split. The Company’s common stock, prior to the up-list, was quoted on the OTC Markets Group Inc.’s (“OTCM”) OTCQX ® Best Market (the “OTCQX”) under the symbol “MVEN.” Business Operations The Company is a data-driven media company that focuses on building deep content verticals powered by a best-in-class digital media platform (the “Platform”), empowering premium publishers who impact, inform, educate and entertain. The Company’s strategy is to focus on key verticals where audiences are passionate about a topic category (e.g., sports, finance) and where it can leverage the strength of its core brands to grow our audience and monetization both within its core brands as well as its media publishers (each, a “Publisher Partner”). The Company’s focus is on leveraging the Platform and iconic brands in targeted verticals to maximize the audience, improve engagement and optimize monetization of digital publishing assets for the benefit of our users, our advertiser clients, and our 35 owned and operated properties as well as properties we run on behalf of independent Publisher Partners. The Company operates the media businesses for Sports Illustrated (as defined below), own and operate TheStreet and The Spun (collectively, Sports Illustrated, TheStreet and The Spun are hereinafter referred to as the Company’s “Owned and Operated Businesses”), and power more than 200 independent Publisher Partners, including Biography, History, and the many team sports sites that comprise FanNation, among others. Each Publisher Partner joins the Platform by invitation-only and is drawn from premium media brands and independent publishing businesses with the objective of augmenting the Company’s position in key verticals and optimizing the performance of the Publisher Partner. Publisher Partners incur the costs in content creation on their respective channels and receive a share of the revenue associated with their content. Because of the state-of-the-art technology and large scale of the Platform and the Company’s expertise in search engine optimization (SEO), social media, subscription marketing and ad monetization, Publisher Partners continually benefit from its ongoing technological advances and bespoke audience development expertise. Additionally, the Company believes the lead brand within each vertical creates a halo benefit for all Publisher Partners in the vertical on both the content and technology sides. While they benefit from these critical performance improvements, they also may save substantially in technology, infrastructure, advertising sales, member marketing, and management costs. In addition, they benefit from recirculation across the Company’s Platform, as well as syndication to more than 25 third-party sites. The Company’s growth strategy is to continue to expand the coalition by adding new Publisher Partners in key verticals that management believes will expand the scale of unique users interacting on the Platform. In each vertical, the Company seeks to build around a leading brand, such as Sports Illustrated (for sports) and TheStreet (for finance), surround it with subcategory specialists, and further enhance coverage with individual expert contributors. The primary means of expansion is adding independent Publisher Partners and/or acquiring publishers that have premium branded content and can broaden the reach and impact of the Platform. As the Company’s digital revenue and gross margin grows, the Company believes it can further accelerate its growth. The Company assumed management of certain Sports Illustrated media assets (pursuant to a licensing agreement with Sports Illustrated, including various amendments, or a collectively referred to herein as the “Sports Illustrated Licensing Agreement”) on October 4, 2019. Sports Illustrated is owned by ABG-SI LLC (“ABG”), a brand development, marketing, and entertainment company. Since assuming management of the Sports Illustrated media assets, the Company has implemented significant changes to rebuild the historic brand and beacon of sports journalism, to evolve and expand the business, and to position it for growth and continued success going forward. SI Sportsbook was launched in 2021 in Colorado. The Company provides the content for SI Sportsbook and its partner, 888, one of the world’s leading online betting and gaming companies, provides the gambling engine. SI Sportsbook covers the NFL, CFB, NCAAMB, MLB, NBA, NHA, PGA, Horse Racing, UCF, Boxing. The content the Company provides includes: (i) Sports Illustrated winners club newsletter, live NFL pre-game show and twitter spaces, (ii) 50,000 NFL and CFB game betting previews and player props, (iii) five new betting articles series, and (iv) four new video on-demand betting series. F- 9 TheStreet is a leading financial news and information provider to investors and institutions worldwide and has produced business news and market analysis for individual investors. TheStreet brings its editorial tradition, strong subscription platform, and valuable membership base to the Company, and benefits from its mobile-friendly CMS, social, video, and monetization technology. The Spun (thespun.com), founded in September 2012, is an online independent sports publication that brings readers the most interesting athletic stories of the day. Currently, The Spun produces more than 30,000 annual content pieces. The Spun reaches approximately 35 million unique readers per month and focuses on the social media aspect of the industry. Seasonality The Company experiences typical media company advertising and membership sales seasonality, which is strong in the fiscal fourth quarter and slower in the fiscal first quarter. Going Concern The Company performed an annual reporting period going concern assessment. Management is required to assess the Company’s ability to continue as a going concern. These consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. The Company’s consolidated financial statements do not include any adjustments that might be necessary if it is unable to continue as a going concern. Historically, the Company has recorded recurring losses from operations and has operated with a net capital deficiency. The Company considered these factors to determine if the significance of those conditions or events would limit its ability to meet its obligations when due. Most recently, operating losses realized in prior years had been impacted by the COVID-19 pandemic and the related shut down of most professional and collegiate sports, which reduced user traffic and advertising revenue. As the Company entered fiscal 2021, and the impact of COVID-19 on its operations began to dissipate, the Company invested heavily in marketing, customer growth, and people and technology as it expanded its operations, specifically related to TheStreet and the Sports Illustrated media business. As reflected in these consolidated financial statements, the Company recorded revenues of approximately $ 189.1 million and incurred a net loss attributable to common stockholders of approximately $ 89.9 million for the year ended December 31, 2021. The Company has historically financed its working capital requirements since inception through the issuance of debt and equity securities. Management has evaluated whether relevant conditions or events, considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern. The factors considered include, but are not limited to, the Company’s financial condition, liquidity sources, obligations due within one year after the issuance date of its accompanying consolidated financial statements, and the funds necessary to maintain operations, including negative financial trends or other indicators of possible financial difficulty. Substantial doubt exists when conditions and events, considered in the aggregate, indicate it is probable that a company will not be able to meet its obligations as they become due within one year after the issuance date of its financial statements. F- 10 Management’s assessment is based on the relevant conditions that are known or reasonably knowable as of the date these consolidated financial statements for the year ended December 31, 2021 were issued. In particular, the Company evaluated: (1) 2022 cash flow forecast, which considered the use of its working capital line with FastPay (as described in Note 14) to fund changes in working capital, under which it has available credit of approximately $ 17.7 million, subject to eligible account receivables, as of the issuance date of these consolidated financial statements for the year ended December 31, 2021, as well as the additional capital the Company raised in a firm commitment underwritten public offering of $ 31.5 million after fees and expenses, which was completed subsequent to December 31, 2021; and (2) its 2022 operating budget, which considers that (i) more than half of the Company’s total revenue is derived from recurring digital and print subscriptions, which are generally paid in advance, and (ii) overall digital revenue, representing 53.4% of the Company’s total revenue, grew approximately 49.1% in fiscal 2021, which the Company believes demonstrates the strength of its brands. In addition, the Company’s firm commitment underwritten public offering, as described above, demonstrates its ability to access capital markets. Finally, the Company also considered its implementation of additional measures, if required, related to potential revenue and earnings declines from continued COVID-19-related challenges. Management’s assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. As a result of these considerations and as a part of the quantitative and qualitative factors that are known or reasonably knowable as of the date these consolidated financial statements for the year ended December 31, 2021 were issued, the Company concluded that conditions and events considered in the aggregate, do not raise substantial doubt about its ability to continue as a going concern for a one-year period following the financial statement issuance date. Reclassifications Certain prior year amounts have been reclassified to conform to current period presentation. These reclassifications were immaterial, both individually and in the aggregate. These changes did not impact previously reported loss from operations or net loss. 2. Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of The Arena Group and its wholly owned subsidiaries, Arena Media, Arena Platform, TheStreet and The Spun. Intercompany balances and transactions have been eliminated in consolidation. Foreign Currency The functional currency of the Company’s foreign subsidiaries is the local currencies (Canadian dollar), as it is the monetary unit of account of the principal economic environment in which the Company’s foreign subsidiaries operate. All assets and liabilities of the foreign subsidiaries are translated at the current exchange rate as of the end of the period, and revenue and expenses are translated at average exchange rates in effect during the period. The gain or loss resulting from the process of translating foreign currencies financial statements into U.S. dollars was immaterial for the year ended December 31, 2020, therefore, a foreign currency cumulative translation adjustment was not reported as a component of accumulated other comprehensive income (loss) and the unrealized foreign exchange gain or loss was omitted from the consolidated statements of cash flows. Foreign currency transaction gains and losses, if any, resulting from or expected to result from transactions denominated in a currency other than the functional currency are recognized in other income, net on the consolidated statements of operations. F- 11 Use of Estimates The preparation of the 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 date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to the selection of useful lives of property and equipment, intangible assets, capitalization of platform development and associated useful lives; assumptions used in accruals for potential liabilities; fair value of assets acquired and liabilities assumed in the business acquisitions, the fair value of the Company’s goodwill and the assessment of acquired goodwill, other intangible assets and long-lived assets for impairment; determination of the fair value of stock-based compensation and valuation of derivatives liabilities; and the assumptions used to calculate contingent liabilities, and realization of deferred tax assets. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. Actual results could differ from these estimates. Risks and Uncertainties The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse developments in these general business and economic conditions could have a material adverse effect on the Company’s financial condition and the results of its operations. In addition, the Company will compete with many companies that currently have extensive and well-funded projects, marketing and sales operations as well as extensive human capital. The Company may be unable to compete successfully against these companies. The Company’s industry is characterized by rapid changes in technology and market demands. As a result, the Company’s products, services, or expertise may become obsolete or unmarketable. The Company’s future success will depend on its ability to adapt to technological advances, anticipate customer and market demands, and enhance its current technology under development. With the initial onset of COVID-19, the Company faced significant change in its advertisers’ buying behavior. Since May 2020, there has been a steady recovery in the advertising market in both pricing and volume, which coupled with the return of professional and college sports yielded steady growth in revenues. Given that the Sports Illustrated media business relies on sporting events to generate content and comprises a material portion of the Company’s revenues, the cash flows and results of operations are susceptible to a widespread cancellation of sporting events or a general limitation of societal activity akin to what is widely known to have occurred in the Unites States and elsewhere during the 2020 calendar year. Future widespread shutdowns of in-person economic activity could have a material impact on the Company’s business. As a result of the Company’s advertising revenue declining in early 2020 caused by the widespread cancellations of sporting events, the Company is vulnerable to a risk of loss in the near term and it is at least reasonably possible that events or circumstances may occur that could cause an impact in the near term, that depend on the actions taken to prevent the further spread of COVID-19. Since August 2018, B. Riley FBR, Inc. (“B. Riley FBR”), a registered broker-dealer owned by B. Riley Financial, Inc., a diversified publicly-traded financial services company (“B. Riley”), has been instrumental in providing investment banking services to the Company and in raising debt and equity capital for the Company. These services have included raising of equity capital to support the acquisition of College Spun Media Incorporated (as described in Note 3). B. Riley has also assisted in the raising of debt and equity capital for various acquisitions, refinancing and working capital purposes including the 12% Convertible Debentures (as described in Note 18), Senior Secured Note and Delayed Draw Term Note (as described in Note 19), Series H, Series I, Series J and Series K Preferred Stock (as described in Note 20), Common Stock Private Placement (as described in Note 21) and the Public Offering (as described in Note 28). F- 12 Segment Reporting The Company operates in one reportable segment which focuses on a publishing platform. The Company’s business offerings have similar operating characteristics and similar long-term operating performance, including the types of customers, nature of product or services, distribution methods and regulatory environment. The chief operating decision maker of the Company reviews specific financial and operational specific data and other key metrics to make resource allocation decisions and assesses performance by review of profit and loss information on a consolidated basis. The consolidated financial statements reflect the financial results of the Company’s one reportable segment. Revenue Recognition In accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers , revenues are recognized when control of the promised goods or services are transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company generates all of its revenue from contracts with customers. The Company accounts for revenue on a gross basis, as compared to a net basis, in its statement of operations. Cost of revenues is presented as a separate line item in the statement of operations. The Company has made this determination based on it taking the credit risk in its revenue-generating transactions and it also being the primary obligor responsible for providing the services to the customer. The following is a description of the principal activities from which the Company generates revenue: Advertising Revenue Digital Advertising – The Company recognizes revenue from digital advertisements at the point when each ad is viewed. The quantity of advertisements, the impression bid prices and revenue are reported on a real-time basis. The Company enters into contracts with advertising networks to serve display or video advertisements on the digital media pages associated with its various channels. Although reported advertising transactions are subject to adjustment by the advertising network partners, any such adjustments are known within a few days of month end. The Company owes its independent Publisher Partners a revenue share of the advertising revenue earned, which is recorded as service costs in the same period in which the associated advertising revenue is recognized. Advertising revenue that is comprised of fees charged for the placement of advertising, on the Company’s flagship website, TheStreet.com, is recognized as the advertising or sponsorship is displayed, if collection of the resulting receivable is reasonably assured. Print Advertising – Advertising related revenues for print advertisements are recognized when advertisements are published (defined as an issue’s on-sale date), net of provisions for estimated rebates, rate adjustments, and discounts. F- 13 Subscription Revenue Digital Subscriptions – The Company enters into contracts with internet users that subscribe to premium content on the owned and operated media channels and facilitate such contracts between internet users and our Publisher Partners. These contracts provide internet users with a membership subscription to access the premium content. The Company owes its independent Publisher Partners a revenue share of the membership subscription revenue earned, which is initially deferred and recorded as deferred contract costs. The Company recognizes deferred contract costs over the membership subscription term in the same pattern that the associated membership subscription revenue is recognized. Subscription revenue generated from the Company’s flagship website TheStreet.com from institutional and retail customers is comprised of subscriptions and license fees for access to securities investment information, stock market commentary, director and officer profiles, relationship capital management services, and transactional information pertaining to mergers and acquisitions and other changes in the corporate control environment. Subscriptions are charged to customers’ credit cards or are directly billed to corporate subscribers, and are generally billed in advance on a monthly, quarterly or annual basis. The Company calculates net subscription revenue by deducting from gross revenue an estimate of potential refunds from cancelled subscriptions as well as chargebacks of disputed credit card charges. Net subscription revenue is recognized ratably over the subscription periods. Unearned revenue relates to payments for subscription fees for which revenue has not been recognized because services have not yet been provided. Print Revenue Print revenue includes magazine subscriptions and single copy sales at newsstands. Print Subscriptions – Revenue from magazine subscriptions is deferred and recognized proportionately as products are distributed to subscribers. Newsstand – Single copy revenue is recognized on the publication’s on-sale date, net of provisions for estimated returns. The Company bases its estimates for returns on historical experience and current marketplace conditions. Licensing Revenue Content licensing-based revenues are accrued generally monthly or quarterly based on the specific mechanisms of each contract. Generally, revenues are accrued based on estimated sales and adjusted as actual sales are reported by partners. These adjustments are typically recorded within three months of the initial estimates and have not been material. Any minimum guarantees are typically earned evenly over the fiscal year. Nature of Performance Obligations At contract inception, the Company assesses the obligations promised in its contracts with customers and identifies a performance obligation for each promise to transfer a good or service or bundle that is distinct. To identify the performance obligations, the Company considers all the promises in the contract, whether explicitly stated or implied based on customary business practices. For a contract that has more than one performance obligation, the Company allocates the total contract consideration to each distinct performance obligation on a relative standalone selling price basis. Revenue is recognized when, or as, the performance obligations are satisfied, and control is transferred to the customer. F- 14 Digital Advertising – The Company sells digital advertising inventory on its websites directly to advertisers or through advertising agencies. The Company’s performance obligations related to digital advertising are generally satisfied when the advertisement is run on the Company’s platform. The price for direct digital advertising is determined in contracts with the advertisers. Revenue from the sale of direct digital advertising is recognized when the advertisements are delivered based on the contract. The customer is invoiced the agreed-upon price in the month following the month that the advertisements are delivered with normal trade terms. The agreed upon price is adjusted for estimated provisions for rebates, rate adjustments, and discounts. As part of the Company’s customary business practices, digital advertising contracts may include a guaranteed number of impressions and sales incentives to its customers including volume discounts, rebates, value added impressions, etc. For all such contracts that include these types of variable consideration, the Company estimates the variable consideration and factors in such an estimate when determining the transaction price. Print Advertising – The Company provides advertisement placements in print media directly to advertisers or through advertising agencies. The Company’s performance obligations related to print advertising are satisfied when the magazine in which an advertisement appears is published, which is defined as an issue’s on-sale date. The customer is invoiced the agreed-upon price when the advertisements are published under normal industry trade terms. The agreed upon price is adjusted for estimated provisions for rebates, rate adjustments, and discounts. As part of the Company’s customary business practices, print advertising contracts include guaranteed circulation levels of magazines, referred to as rate base, and a number of sales incentives to its customers including volume discounts, rebates, bonus pages, etc. For all such contracts that include these types of variable consideration, the Company estimates such when determining the transaction price. Digital Subscriptions – The Company recognizes revenue from each membership subscription to access the premium content over time based on a daily calculation of revenue during the reporting period, which is generally one year. Subscriber payments are initially recorded as unearned revenue on the balance sheets. As the Company provides access to the premium content over the membership subscription term, the Company recognizes revenue and proportionately reduces the unearned revenue balance. Print Subscriptions – The Company sells magazines to consumers through subscriptions. Each copy of a magazine is determined to be a distinct performance obligation that is satisfied when the publication is sent to the customer. The majority of the Company’s subscription sales are prepaid at the time of order. Subscriptions may be canceled at any time for a refund of the price paid for remaining issues. As the contract may be canceled at any time for a full refund of the unserved copies, the contract term is determined to be on an issue-to-issue basis as these contracts do not have substantive termination penalties. Revenues from subscriptions are deferred and recognized proportionately as subscribers are served. Some magazine subscription offers contain more than one magazine title in a bundle. The Company allocates the total contract consideration to each distinct performance obligation, or magazine title, based on a standalone-selling price basis. Newsstand – The Company sells single copy magazines, or bundles of single copy magazines, to wholesalers for ultimate resale on newsstands primarily at major retailers and grocery/drug stores, and in digital form on tablets and other electronic devices. Publications sold to magazine wholesalers are sold with the right to receive credit from the Company for magazines returned to the wholesaler by retailers. Revenue is recognized on the issue’s on-sale date as the date aligns most closely with the date that control is transferred to the customer. The Company bases its estimates for returns on historical experience and current marketplace conditions. Licensing – The Company has entered into various licensing agreements that provide third-party partners the right to utilize the Company’s content. Functional licenses in national media consist of content licensing. F- 15 Timing of Satisfaction of Performance Obligations Point-in-Time Performance Obligations – For performance obligations related to certain digital advertising space and sales of print advertisements, the Company determines that the customer can direct the use of and obtain substantially all the benefits from the advertising products as the digital impressions are served or on the issue’s on-sale date. For performance obligations related to sales of magazines through subscriptions, the customer obtains control when each magazine issue is mailed to the customer on or before the issue’s on-sale date. For sales of single copy magazines on newsstands, revenue is recognized on the issue’s on-sale date as the date aligns most closely with the date that control is transferred to the customer. Revenues from functional licenses are recognized at a point-in-time when access to the completed content is granted to the partner. Over-Time Performance Obligations – For performance obligations related to sales of certain digital advertising space, the Company transfers control and recognizes revenue over time by measuring progress towards complete satisfaction using the most appropriate method. For performance obligations related to digital advertising, the Company satisfies its performance obligations on some flat-fee digital advertising placements over time using a time-elapsed output method. Determining a measure of progress requires management to make judgments that affect the timing of revenue recognized. The Company has determined that the above method provides a faithful depiction of the transfer of goods or services to the customer. For performance obligations recognized using a time-elapsed output method, the Company’s efforts are expended evenly throughout the period. Performance obligations related to subscriptions to premium content on the digital media channels provides access for a given period of time, which is generally one year. The Company recognizes revenue from each membership subscription over time based on a daily calculation of revenue during the reporting period. Transaction Price and Amounts Allocated to Performance Obligations Determining the Transaction Price – Certain advertising contracts contain variable components of the transaction price, such as volume discounts and rebates. The Company has sufficient historical data and has established processes to reliably estimate these variable components of the transaction price. Subscription revenue generated from the flagship website TheStreet.com is subject to estimation and variability due to the fact that, in the normal course of business, subscribers may for various reasons contact the Company or their credit card companies to request a refund or other adjustment for a previously purchased subscription. With respect to many of the Company’s annual newsletter subscription products, the Company offers the ability to receive a refund during the first 30 days but none thereafter. Accordingly, the Company maintains a provision for estimated future revenue reductions resulting from expected refunds and chargebacks related to subscriptions for which revenue was recognized in a prior period. The calculation of this provision is based upon historical trends and is reevaluated each quarter. The Company typically does not offer any type of variable consideration in standard magazine subscription contracts. For these contracts, the transaction price is fixed upon establishment of the contract that contains the final terms of the sale including description, quantity and price of each subscription purchased. Therefore, the Company does not estimate variable consideration or perform a constraint analysis for these contracts. A right of return exists for newsstand contracts. The Company has sufficient historical data to estimate the final amount of returns and reduces the transaction price at contract inception for the expected return reserve. F- 16 There is no variable consideration related to functional licenses. Estimating Standalone-Selling Prices – For contracts that contain multiple performance obligations, the Company allocates the transaction price to each performance obligation on a relative standalone-selling price basis. The standalone-selling price is the price at which the Company would sell a promised good or service separately to the customer. In situations in which an obligation is bundled with other obligations and the total amount of consideration does not reflect the sum of individual observable prices, the Company allocates the discount to (1) a single obligation if the discount is attributable to that obligation or (2) prorates across all obligations if the discount relates to the bundle. When standalone-selling price is not directly observable, the Company estimates and considers all the information that is reasonably available to the Company, including market conditions, entity specific factors, customer information, etc. The Company maximizes the use of observable inputs and applies estimation methods consistently in similar circumstances. Measuring Obligations for Returns and Refunds – The Company accepts product returns in some cases. The Company establishes provisions for estimated returns concurrently with the recognition of revenue. The provisions are established based upon consideration of a variety of factors, including, among other things, recent and historical return rates for both specific products and distributors and the impact of any new product releases and projected economic conditions. As of December 31, 2021 and 2020, a subscription refund liability of $ 3,086,799 and $ 4,035,531 , respectively, was recorded for the provision for the estimated returns and refunds on the consolidated balance sheets. Contract Modifications The Company occasionally enters into amendments to previously executed contracts that constitute contract modifications. The Company assesses each of these contract modifications to determine: ● if the additional services and goods are distinct from the services and goods in the original arrangement; and ● if the amount of consideration expected for the added services or goods reflects the stand-alone selling price of those services and goods. A contract modification meeting both criteria is accounted for as a separate contract. A contract modification not meeting both criteria is considered a change to the original contract and is accounted for on either a prospective basis as a termination of the existing contract and the creation of a new contract, or a cumulative catch-up basis (further details are provided under the headings Contract Balances and Subscription Acquisition Costs ). F- 17 Disaggregation of Revenue The following table provides information about disaggregated revenue by category, geographical market and timing of revenue recognition: Schedule of Disaggregation of Revenue 2021 2020 Years Ended December 31, 2021 2020 Revenue by category: Digital revenue Digital advertising $ 62,864,924 $ 34,648,945 Digital subscriptions 29,628,355 28,495,676 Other revenue 8,515,655 4,596,686 Total digital revenue 101,008,934 67,741,307 Print revenue Print advertising 9,050,671 9,710,877 Print subscriptions 79,080,729 50,580,213 Total print revenue 88,131,400 60,291,090 Total $ 189,140,334 $ 128,032,397 Revenue by geographical market: United States $ 182,706,557 $ 122,570,712 Other 6,433,777 5,461,685 Total $ 189,140,334 $ 128,032,397 Revenue by timing of recognition: At point in time $ 159,511,979 $ 99,536,721 Over time 29,628,355 28,495,676 Total $ 189,140,334 $ 128,032,397 Cost of Revenue Cost of revenue represents the cost of providing the Company’s digital media channels and advertising and membership services. The cost of revenue that the Company has incurred in the periods presented primarily include: Publisher Partner guarantees and revenue share payments; amortization of developed technology and platform development; royalty fees; hosting and bandwidth and software license fees; printing and distribution costs; payroll and related expenses for customer support, technology maintenance, and occupancy costs of related personnel; fees paid for data analytics and to other outside service providers; and stock-based compensation of related personnel and stock-based compensation related to Publisher Partner Warrants (as described in Note 22). F- 18 Contract Balances The timing of the Company’s performance under its various contracts often differs from the timing of the customer’s payment, which results in the recognition of a contract asset or a contract liability. A contract asset is recognized when a good or service is transferred to a customer and the Company does not have the contractual right to bill for the related performance obligations. An asset is recognized when certain costs incurred to obtain a contract meet the capitalization criteria. A contract liability is recognized when consideration is received from the customer prior to the transfer of goods or services. The following table provides information about contract balances: Schedule of Contract with Customer, Asset and Liability 2021 2020 As of December 31, 2021 2020 Unearned revenue (short-term contract liabilities): Digital revenue $ 14,692,479 $ 15,039,331 Print revenue 39,337,178 46,586,345 Total short-term contract liabilities $ 54,029,657 $ 61,625,676 Unearned revenue (long-term contract liabilities): Digital revenue $ 1,444,440 $ 785,636 Print revenue 13,831,452 22,712,961 Total long-term contract liabilities $ 15,275,892 $ 23,498,597 Unearned Revenue – Unearned revenue, also referred to as contract liabilities, include payments received in advance of performance under the contracts and are recognized as revenue over time. The Company records contract liabilities as unearned revenue on the consolidated balance sheets. Digital subscription and print subscription revenue of $56,368,308 was recognized during the year ended December 31, 2021 from unearned revenue at the beginning of the year. During January of 2020, February of 2020 and December of 2021, the Company modified certain digital and print subscription contracts that prospectively changed the frequency of the related issues (or magazines) required to be delivered on a yearly basis (the “Contract Modifications”). The Company determined that the remaining digital content and magazines to be delivered are distinct from the digital content or magazines already provided under the original contract. As a result, the Company in effect established a new contract that included only the remaining digital content or magazines. Accordingly, the Company allocated the remaining performance obligations in the contracts as consideration from the original contract that has not yet been recognized as revenue. For the years ended December 31, 2021 and 2020, the Company recognized revenue of $ 2,821,155 and $ 9,341,946 , respectively, resulting from the Contract Modifications. Cash, Cash Equivalents, and Restricted Cash The Company maintains cash, cash equivalents, and restricted cash at banks where amounts on deposit may exceed the Federal Deposit Insurance Corporation limit during the year. Cash and cash equivalents represent cash and highly liquid investments with an original contractual maturity at the date of purchase of three months. As of December 31, 2021 and 2020, cash and cash equivalents consist primarily of checking, savings deposits and money market accounts. These deposits exceeded federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk regarding its cash and cash equivalents. The following table reconciles total cash, cash equivalents, and restricted cash: Schedule of Cash and Restricted Cash 2021 2020 As of December 31, 2021 2020 Cash and cash equivalents $ 9,349,020 $ 9,033,872 Restricted cash 501,780 500,809 Total cash, cash equivalents, and restricted cash $ 9,850,800 $ 9,534,681 As of December 31, 2021 and 2020, the Company had restricted cash of $ 501,780 and $ 500,809 , respectively, which serves as collateral for certain credit card merchant accounts with a bank. F- 19 Accounts Receivable The Company receives payments from advertising customers based upon contractual payment terms; accounts receivable is recorded when the right to consideration becomes unconditional and are generally collected within 90 days. The Company generally receives payments from digital and print subscription customers at the time of sign up for each subscription; accounts receivable from merchant credit card processors are recorded when the right to consideration becomes unconditional and are generally collected weekly. Accounts receivable as of December 31, 2021 and 2020 of $ 21,659,847 and $ 16,497,626 , respectively, are presented net of allowance for doubtful accounts. The allowance for doubtful accounts as of December 31, 2021 and 2020 was $ 1,578,357 and $ 892,352 , respectively. Subscription Acquisition Costs Subscription acquisition costs include the incremental costs of obtaining a contract with a customer, paid to external parties, if it expects to recover those costs. The Company has determined that sales commissions paid on all third-party agent sales of subscriptions are direct and incremental and, therefore, meet the capitalization criteria. Direct mail costs also meet the requirements to be capitalized as assets if they are proven to be recoverable. The incremental costs of obtaining a contract are amortized as revenue is recognized or over the term of the agreement. The Company had no asset impairment charges related to the subscription acquisition costs during the years ended December 31, 2021 and 2020. The Contract Modifications resulted in subscription acquisition costs to be recognized on a prospective basis in the same proportion as the revenue that has not yet been recognized. As of December 31, 2021 and 2020, subscription acquisition costs were $ 38,397,077 (short-term of $ 30,162,524 and long-term of $ 8,234,553 ) and $ 41,505,480 (short-term of $ 28,146,895 and long-term of $ 13,358,585 ), respectively. Subscription acquisition cost as of December 31, 2021 presented as current assets of $ 30,162,524 are expected to be amortized during the year ending December 31, 2021 and $ 8,234,553 presented as long-term assets are expected to be amortized after the year ending December 31, 2021. Concentrations Significant Customers – Concentration of credit risk with respect to accounts receivable is limited to customers to whom the Company makes significant sales. While a reserve for the potential write-off of accounts receivable is maintained, the Company has not written off any significant accounts to date. To control credit risk, the Company performs regular credit evaluations of its customers’ financial condition. Revenue from a significant customer as a percentage of the Company’s total revenue represents 11.3 % and none for the years ended December 31, 2021 and 2020, respectively. A significant accounts receivable balance as a percentage of the Company’s total accounts receivable represents 10.7 % and none for the years ended December 31, 2021 and 2020, respectively. Significant Vendors – Concentrations of risk with respect to third party vendors who provide products and services to the Company are limited. If not limited, such concentrations could impact profitability if a vendor failed to fulfill their obligations or if a significant vendor was unable to renew an existing contract and the Company was not able to replace the related product or service at the same cost. A significant accounts payable balance as a percentage of the Company’s total accounts payable represents 10.5 % and none for the years ended December 31, 2021 and 2020, respectively. F- 20 Leases The Company has lease arrangements for certain equipment and its offices. Leases are recorded as an operating lease right-of-use assets and operating lease liabilities on the consolidated balance sheets. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheets. At inception, the Company determines whether an arrangement that provides control over the use of an asset is a lease. When it is reasonably certain that the Company will exercise the renewal period, the Company includes the impact of the renewal in the lease term for purposes of determining total future lease payments. Rent expense is recognized on a straight-line basis over the lease term. Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statement of operations when realized. Depreciation and amortization are provided using the straight-line method over the following estimated useful lives: Schedule of Depreciation and Amortization, Useful Lives of Assets Office equipment and computers 1 – 3 years Furniture and fixtures 1 – 5 years Leasehold improvements Shorter of remaining lease term or estimated useful life Platform Development The Company capitalizes platform development costs for internal use when planning and design efforts are successfully completed, and development is ready to commence. The Company places capitalized platform development assets into service and commences amortization when the applicable project or asset is substantially complete and ready for its intended use. Once placed into service, the Company capitalizes qualifying costs of specified upgrades or enhancements to capitalized platform development assets when the upgrade or enhancement will result in new or additional functionality. The Company capitalizes internal labor costs, including payroll-based and stock-based compensation, benefits and payroll taxes, that are incurred for certain capitalized platform development projects related to the Company’s technology platform. The Company’s policy with respect to capitalized internal labor stipulates that labor costs for employees working on eligible internal use capital projects are capitalized as part of the historical cost of the project when the impact, as compared to expensing such labor costs, is material. Platform development costs are amortized on a straight-line basis over three years, which is the estimated useful life of the related asset and is recorded in cost of revenues on the consolidated statements of operations. F- 21 Business Combinations The Company accounts for business combinations using the acquisition method of accounting. The acquisition method of accounting requires that the purchase price, including the fair value of contingent consideration, of the acquisition be allocated to the assets acquired and liabilities assumed using the estimated fair values determined by management as of the acquisition date. Goodwill is measured as the excess of consideration transferred and the net fair values of the assets acquired and the liabilities assumed at the date of acquisition. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, the Company records adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent the Company identifies adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period, which may be up to one year from the acquisition date, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. Additionally, the Company identifies acquisition-related contingent payments and determines their respective fair values as of the acquisition date, which are recorded as accrued liabilities on the consolidated balance sheets. Subsequent changes in fair value of contingent payments are recorded on the consolidated statements of operations. The Company expenses transaction costs related to the acquisition as incurred. Intangible Assets Intangibles with finite lives, consisting of developed technology and trade names, are amortized using the straight-line method over the estimated economic lives of the assets. A finite lived intangible asset is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Intangibles with an indefinite useful life are not being amortized. Long-Lived Assets The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily by reference to the anticipated cash flows discounted at a rate commensurate with the risk involved. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in a business combination. Goodwill is not amortized but rather is tested for impairment at least annually on December 31, or more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. The Company operates as one reporting unit, therefore, the impairment test is performed at the consolidated entity level. Recoverability of goodwill is determined by comparing the fair value of Company’s reporting unit to the carrying value of the underlying net assets in the reporting unit. If the fair value of the reporting unit is determined to be less than the carrying value of its net assets, goodwill is deemed impaired and an impairment loss is recognized to the extent that the carrying value of goodwill exceeds the difference between the fair value of the reporting unit and the fair value of its other assets and liabilities. As of December 31, 2021 and 2020, management determined there were no indications of impairment. F- 22 Deferred Financing Costs and Discounts on Debt Obligations Deferred financing costs consist of cash and noncash consideration paid to lenders and third parties with respect to convertible debt and other financing transactions, including legal fees and placement agent fees. Such costs are deferred and amortized over the term of the related debt. Upon the settlement of debt or conversion of convertible debt into common stock, under certain circumstances, the pro rata portion of any related unamortized deferred financing costs are charged to operations. Additional consideration in the form of warrants and other derivative financial instruments issued to lenders is accounted for at fair value utilizing information determined by consultants with the Company’s independent valuation firm. The fair value of warrants and derivatives are recorded as a reduction to the carrying amount of the related debt and are being amortized to interest expense over the term of such debt, with the initial offsetting entries recorded as a liability on the balance sheet. Upon the settlement or conversion of convertible debt into common stock, under certain circumstances, the pro rata portion of any related unamortized discount on debt is charged to operations. Liquidated Damages Liquidated damages are provided as a result of the following: (i) certain registration rights agreements provide for damages if the Company does not register certain shares of the Company’s common stock within the requisite time frame (the “Registration Rights Damages”); and (ii) certain securities purchase agreements provide for damages if the Company does not maintain its periodic filings with the Securities and Exchange Commission (“SEC”) within the requisite time frame (the “Public Information Failure Damages”). Obligations with respect to the Registration Rights Damages and the Public Information Failure Damages (collectively, the “Liquidated Damages”) are accounted for as contingent obligations when it is deemed probable the obligations would not be satisfied at the time a financing is completed and are subsequently reviewed at each quarter-end reporting date thereafter. When such quarterly review indicates that it is probable that the Liquidated Damages will be incurred, the Company records an estimate of each such obligation at the balance sheet date based on the amount due of such obligation. Selling and Marketing Selling and marketing expenses consist of compensation, employee benefits and stock-based compensation of selling and marketing, account management support teams, as well as commissions, travel, trade show sponsorships and events, conferences and advertising costs. The Company’s advertising expenses relate to direct-mail costs for magazine subscription acquisition efforts, print, and digital advertising. Advertising costs that are not capitalized are expensed the first time the advertising takes place. During the years ended December 31, 2021 and 2020, the Company incurred advertising expenses of $ 5,942,759 and $ 3,583,116 , respectively, which are included within selling and marketing on the consolidated statements of operations. General and Administrative General and administrative expenses consist primarily of payroll for executive personnel, technology personnel incurred in developing conceptual formulation and determination of existence of needed technology, and administrative personnel along with any related payroll costs; professional services, including accounting, legal and insurance; facilities costs; conferences; other general corporate expenses; and stock-based compensation of related personnel. Derivative Financial Instruments The Company accounts for freestanding contracts that are settled in the Company’s equity securities, including common stock warrants, to be designated as an equity instrument, and generally as a liability. A contract so designated is carried at fair value on a company’s balance sheet, with any changes in fair value recorded as a gain or loss in a company’s results of operations. F- 23 The Company records all derivatives on the balance sheet at fair value, adjusted at the end of each reporting period to reflect any material changes in fair value, with any such changes classified as changes in derivatives valuation in the statement of operations. The calculation of the fair value of derivatives utilizes highly subjective and theoretical assumptions that can materially affect fair values from period to period. The recognition of these derivative amounts does not have any impact on cash flows. At the date of exercise of any of the warrants, or the conversion of any convertible debt or preferred stock into common stock, the pro rata fair value of the related warrant liability and any embedded derivative liability is transferred to additional paid-in capital. Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1 . Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2 . Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3 . Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The carrying amount of the Company’s financial instruments comprising of cash, restricted cash, accounts receivable, accounts payable and accrued expenses and other approximate fair value because of the short-term maturity of these instruments. Preferred Stock Preferred stock (the “Preferred Stock”) (as described in Note 20) is reported as a mezzanine obligation between liabilities and stockholders’ deficiency. If it becomes probable that the Preferred Stock will become redeemable, the Company will re-measure the Preferred Stock by adjusting the carrying value to the redemption value of the Preferred Stock assuming each balance sheet date is a redemption date. Stock-Based Compensation The Company provides stock-based compensation in the form of (a) stock awards to employees and directors, comprised of restricted stock awards and restricted stock units, (b) stock option grants to employees, directors and consultants, (c) common stock warrants to Publisher Partners (no warrants were issued during the years ended December 31, 2021 or 2020) (further details are provided under the heading Publisher Partner Warrants in Note 22), and (d) common stock warrants to ABG (further details are provided under the heading ABG Warrants in Note 22). F- 24 The Company accounts for stock awards and stock option grants to employees, directors and consultants, and non-employee awards to certain directors and consultants by measuring the cost of services received in exchange for the stock-based payments as compensation expense in the Company’s consolidated financial statements. Stock awards and stock option grants to employees and non-employees which are time-vested, are measured at fair value on the grant date, and charged to operations ratably over the vesting period. Stock awards and stock option grants to employees and non-employees which are performance-vested, are measured at fair value on the grant date and charged to operations when the performance condition is satisfied or over the service. The fair value measurement of equity awards and grants used for stock-based compensation is as follows: (1) restricted stock awards and restricted stock units which are time-vested, are determined using the quoted market price of the Company’s common stock at the grant date; (2) stock option grants which are time-vested and performance-vested, are determined utilizing the Black-Scholes option-pricing model at the grant date; (3) restricted stock units and stock option grants which provide for market-based vesting with a time-vesting overlay, are determined through consultants with the Company’s independent valuation firm using the Monte Carlo model at the grant date; (4) Publisher Partner Warrants are determined utilizing the Black-Scholes option-pricing model; and (5) ABG warrants are determined utilizing the Monte Carlo model (further details are provided in Note 22). Fair value determined under the Black-Scholes option-pricing model and Monte Carlo model is affected by several variables, the most significant of which are the life of the equity award, the exercise price of the stock option or warrants, as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. Estimated volatility is based on the historical volatility of the Company’s common stock and is evaluated based upon market comparisons. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair market value of common stock is determined by reference to the quoted market price of the Company’s common stock. The fair value of the stock options granted are probability weighted under the Black-Scholes option-pricing model or Monte Carlo model as determined through consultants with the Company’s independent valuation firm since the value of the stock options, among other things, depend on the volatility of the underlying shares of the Company’s common stock, under the following two scenarios: (1) scenario one assumes that the Company’s common stock will be up-listed on a national stock exchange (the “Exchange”) on a certain listing date (the “Up-list”); and (2) scenario two assumes that the Company’s common stock is not up-listed on the Exchange prior to the final vesting date of the grants (the “No Up-list”), collectively referred to as the “Probability Weighted Scenarios”. The Company classifies stock-based compensation cost on its consolidated statements of operations in the same manner in which the award recipient’s cash compensation cost is classified. Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to operating loss carryforwards and temporary differences between financial statement bases of existing assets and liabilities and their respective income tax bases. Deferred tax assets and liabilities are measured using enacted income 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 of a change in the income tax rates on deferred tax asset and liability balances is recognized in income in the period that includes the enactment date of such rate change. A valuation allowance is recorded for loss carryforwards and other deferred tax assets when it is determined that it is more likely than not that such loss carryforwards and deferred tax assets will not be realized. The Company follows accounting guidance that sets forth a threshold for financial statement recognition, measurement, and disclosure of a tax position taken or expected to be taken on a tax return. Such guidance requires the Company to determine whether a tax position of the Company is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on technical merits of the position. F- 25 Loss per Common Share Basic loss per share is computed using the weighted average number of common shares outstanding during the period and excludes any dilutive effects of common stock equivalent shares, such as stock options, restricted stock, and warrants. All restricted stock awards are considered outstanding but are included in the computation of basic loss per common share only when the underlying restrictions expire, the shares are no longer forfeitable, and are thus vested. All restricted stock units are included in the computation of basic loss per common share only when the underlying restrictions expire, the shares are no longer forfeitable, and are thus vested. Contingently issuable shares are included in basic loss per common share only when there are no circumstances under which those shares would not be issued. Diluted loss per common share is computed using the weighted average number of common shares outstanding and common stock equivalent shares outstanding during the period using the treasury stock method. Common stock equivalent shares are excluded from the computation if their effect is anti-dilutive. The Company excluded the outstanding securities summarized below (capitalized terms are described herein), which entitle the holders thereof to acquire shares of the Company’s common stock, from its calculation of net income loss per common share, as their effect would have been anti-dilutive. Schedule of Net Income (Loss) Per Common Share As of December 31, 2021 2020 Series G Preferred Stock 8,582 8,582 Series H Preferred Stock 2,075,200 2,699,312 Restricted Stock Awards 194,806 14,394 Financing Warrants 116,118 131,003 ABG Warrants 999,540 999,540 AllHipHop Warrants 5,681 5,681 Publisher Partner Warrants 35,607 35,888 Common Stock Awards 293,341 313,742 Common Equity Awards 6,907,454 3,730,106 Outside Options 138,637 138,728 Total 10,774,966 8,076,976 Recent Accounting Pronouncements Recently Adopted Accounting Standards In August 2018, the FASB issued ASU 2018-13, Technical Corrections and Improvements to Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which changes the fair value measurement disclosure requirements. The update removes, modifies, and adds certain additional disclosures. On January 1, 2021, the Company adopted ASU 2018-13 with no material impact to its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. This guidance also clarifies and simplifies other areas of ASC 740. Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis, and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings/(deficit) in the period of adoption. On January 1, 2021, the Company adopted ASU 2019-12 with no material impact to its consolidated financial position, results of operations or cash flows. In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20 – Receivables – Nonrefundable Fees and Other Costs , which clarifies that a reporting entity should assess whether a callable debt security purchased at a premium is within the scope of ASC 310-20-35-33 each reporting period, which impacts the amortization period for nonrefundable fees and other costs. On January 1, 2021, the Company adopted ASU 2020-08 with no material impact to its consolidated financial statements. F- 26 In October 2020, the FASB issued ASU 2020-10, Codification Improvements , which updates various codification topics by clarifying or improving disclosure requirements to align with the SEC’s regulations. On January 1, 2021, the Company adopted ASU 2020-10 with no material impact to its consolidated financial statements. Recently Issued Accounting Standards In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) , which updates various codification topics to simplify the accounting guidance for certain financial instruments with characteristics of liabilities and equity, with a specific focus on convertible instruments and the derivative scope exception for contracts in an entity’s own equity and amends the diluted EPS computation for these instruments. ASU 2020-06 is effective for annual and interim reporting periods beginning after December 15, 2021, with early adoption permitted for annual and interim reporting periods beginning after December 15, 2020. The Company will adopt ASU 2020-06 as of the reporting period beginning January 1, 2022. The adoption of this update is not expected to have a material effect on the Company’s consolidated financial statements. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options, a consensus of the Emerging Issues Task Force (EITF), to provide explicit guidance on accounting by issuers for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after the modification or exchange. ASU 2021-04 is effective for fiscal years beginning after December 31, 2021. The Company is currently evaluating the impact this update will have on its consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires an acquirer to account for revenue contracts acquired in a business combination in accordance with Topic 606 as if it had originated the contracts. The acquirer may assess how the acquiree applied Topic 606 to determine what to record for the acquired contracts. This update should lead to recognition and measurement consistent with what’s reported in the acquiree’s financial statements, provided that the acquiree prepared financial statements in accordance with U.S. GAAP. The new standard marks a change from current U.S. GAAP, under which assets and liabilities acquired in a business combination, including contract assets and contract liabilities arising from revenue contracts, are generally recognized at fair value at the acquisition date. ASU 2021-08 is effective for the Company in the fiscal year beginning after December 15, 2022, including interim periods within the fiscal year, and should be applied prospectively to business combinations on or after the effective date of the amendment. Early adoption is permitted, including adoption in an interim period. The Company will adopt ASU 2021-08 as of the reporting period beginning January 1, 2022. The Company is currently evaluating the impact that adopting this new accounting standard would have on its consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. 3. Acquisitions The Company uses the acquisition method of accounting, which is based on ASC, Business Combinations (Topic 805) , and uses the fair value concepts which requires, among other things, that most assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. F- 27 2021 Acquisitions College Spun Media Incorporated – On June 4, 2021, the Company acquired all of the issued and outstanding shares of capital stock of College Spun Media Incorporated, a New Jersey corporation (“The Spun”), for an aggregate of $ 11,829,893 in cash and the issuance of an aggregate of 194,806 restricted shares of the Company’s common stock, with one-half of the shares vesting on the first anniversary of the closing date and the remaining one-half of the shares vesting on the second anniversary of the closing date, subject to a customary working capital adjustment based on cash and accounts receivable as of the closing date. The cash payment consists of: (i) $ 10,829,893 paid at closing (of the cash paid at closing, $ 829,893 represents adjusted cash pursuant to the working capital adjustments), and (ii) $ 500,000 to be paid on the first anniversary of the closing and $ 500,000 to be paid on the second anniversary date of the closing. The vesting of shares of the Company’s common stock is subject to the continued employment of certain selling employees. The Spun operates in the United States. The composition of the purchase price is as follows: Schedule of Preliminary Purchase Price Cash $ 10,829,893 Deferred cash payments, as discounted 905,109 Total purchase consideration $ 11,735,002 The Company incurred $ 128,076 in transaction costs related to the acquisition, which primarily consisted of legal and accounting. The acquisition related expenses were recorded within general and administrative expense on the consolidated statements of operations. The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Summary of Price Allocation for Acquisition Cash $ 3,214,436 Accounts receivable 1,772,025 Other current assets 4,567 Brand name 5,175,136 Goodwill 3,479,290 Accrued expenses ( 84,732 ) Deferred tax liabilities ( 1,825,720 ) Net assets acquired $ 11,735,002 The Company utilized an independent appraisal to assist in the determination of the fair values of the assets acquired and liabilities assumed, which required certain significant management assumptions and estimates. The fair value of the brand name was determined by projecting the acquired entity’s cash flows, deducting notional contributory asset charges on supporting assets (working capital and the assembled workforce) to compute the excess cash flows associated with the brand with a useful life of ten years ( 10 .0 years). The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents goodwill from the acquisition. Goodwill is recorded as a non-current asset that is not amortized but is subject to an annual review for impairment. No portion of the goodwill will be deductible for tax purposes. F- 28 Fulltime Fantasy Sports, LLC – On July 15, 2021, the Company entered into an asset purchase agreement with Fulltime Fantasy Sports, LLC, a Delaware limited liability company (“Fulltime Fantasy”), where it purchased certain intellectual property (including databases, documents and certain rights related to the intellectual property), subscriber and customer records, and other certain rights related to the intellectual property (collectively the “Purchased Assets”) and assumed certain liabilities related to the Purchased Assets. The purchase price consisted of: (1) a cash payment of $ 335,000 (paid in advance), including transaction related costs of $ 35,000 , (2) the issuance of 34,092 shares the Company’s common stock (subject to certain vesting earn-out provisions and certain buy-back rights), with 11,364 shares of the Company’s common stock, which vested at closing, and (3) a cash earn-out payment of $ 225,000 (paid in January 2022) and 11,364 shares of the Company’s common stock (vested on December 31, 2021). The remaining consideration of a cash earn-out payment of $ 225,000 is due on June 30, 2022 and the vesting of 11,364 shares of the Company’s common stock, which vests on June 30, 2022, is subject to certain terms and conditions and the material breach of certain agreements and acceleration provisions. The Company accounted for the asset acquisition in accordance with ASC 805-50, as substantially all of the fair value of the gross assets acquired by the Company is concentrated in a group of similar identifiable assets. All direct acquisition related costs of $ 35,000 are assigned to the assets in relation to the relative fair value of the acquired assets and recorded as part of the consideration transferred. The composition of the purchase price is as follows: Schedule of Preliminary Purchase Price $ 335,000 Cash (including $ 35,000 of transaction related costs) $ 335,000 Restricted stock 167,500 Deferred cash payments 419,387 Deferred restricted stock 335,000 Total purchase consideration $ 1,256,887 The purchase price resulted in $ 1,256,887 (including $ 35,000 of transaction related costs) being assigned to a database acquired at the closing date of the acquisition. The useful life for the database is three years ( 3 .0 years). 2020 Acquisitions Petametrics Inc. – On March 9, 2020, the Company entered into an asset purchase agreement with Petametrics Inc., doing business as LiftIgniter, a Delaware corporation (“LiftIgniter”), where it purchased substantially all the assets, including the intellectual property and excluding certain accounts receivable, and assumed certain liabilities. The purchase price consisted of: (1) a cash payment of $ 184,087 on February 19, 2020, in connection with the repayment of all outstanding indebtedness, (2) at closing, a cash payment of $ 131,202 , (3) collections of certain accounts receivable, (4) on the first anniversary date of the closing, the issuance of restricted stock for an aggregate of up to 14,205 shares of the Company’s common stock (of which 11,667 shares of the Company’s common stock were issued during the year ended December 31, 2021 with 2,539 shares to be issued), and (5) on the second anniversary date of the closing, the issuance of restricted stock for an aggregate of up to 14,205 shares (subject to certain indemnifications) of the Company’s common stock. The composition of the purchase price is as follows: Schedule of Preliminary Purchase Price Cash $ 315,289 Indemnity restricted stock units for shares of common stock 500,000 Total purchase consideration $ 815,289 The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Summary of Price Allocation for Acquisition Accounts receivable $ 37,908 Developed technology 917,762 Accounts payable ( 53,494 ) Unearned revenue ( 86,887 ) Net assets acquired $ 815,289 The useful life for the developed technology is three years ( 3 .0 years). F- 29 4. Prepayments and Other Current Assets Prepayments and other current assets are summarized as follows: Schedule of Prepayments and Other Current Assets 2021 2020 As of December 31, 2021 2020 Prepaid expenses $ 3,467,075 $ 3,400,080 Prepaid software license 128,525 378,488 Refundable income and franchise taxes 744,642 733,553 Security deposits - 92,494 Other receivables 407,605 62,648 Prepayments and other current assets $ 4,747,847 $ 4,667,263 5. Royalty Fees As of December 31, 2021 and 2020, $ 11,250,000 and $ 26,250,000 , respectively, of royalty fees were unamortized from the $ 45,000,000 guaranteed minimum annual royalties that was prepaid to ABG in connection with the Sports Illustrated Licensing Agreement. The royalties are being recognized over a period of three-years starting October 4, 2019. As of December 31, 2021, the current portion of $ 11,250,000 was reflected within royalty fees, current portion on the consolidated balance sheets. As of December 31, 2020, the current portion of $ 15,000,000 was reflected within royalty fees, current portion on the consolidated balance sheets and the long-term portion of $ 11,250,000 was reflected within royalty fees, net of current portion on the consolidated balance sheets. 6. Property and Equipment Property and equipment are summarized as follows: Schedule of Property and Equipment As of December 31, 2021 2020 Office equipment and computers $ 1,344,532 $ 1,341,292 Furniture and fixtures 1,005 19,997 Leasehold improvements - 345,516 1,345,537 1,706,805 Less accumulated depreciation and amortization ( 709,769 ) ( 577,367 ) Net property and equipment $ 635,768 $ 1,129,438 Depreciation and amortization expense for the years ended December 31, 2021 and 2020 was $ 443,422 and $ 638,796 , respectively. Depreciation and amortization expense is included in selling and marketing expenses and general and administrative expenses, as appropriate, on the consolidated statements of operations. No impairment charges have been recorded in the periods presented. 7. Leases The Company’s real estate lease for the use of office space was subleased during the year ended December 31, 2021. The Company determines whether an arrangement contains a lease at inception. Lease assets and liabilities are recognized upon commencement of the lease based on the present value of the future minimum lease payments over the lease term. The lease term includes options to extend the lease when it is reasonably certain that the Company will exercise that option. The Company’s current lease is a long-term operating lease with a remaining fixed payment term of 2.75 years. F- 30 The table below presents supplemental information related to operating leases: Schedule of Supplemental Information Related to Operating Leases Years Ended December 31, 2021 2020 Operating lease costs during the year (1) $ 2,718,499 $ 4,054,423 Cash payments included in the measurement of operating lease liabilities during the year $ 2,787,266 $ 3,188,986 Operating lease liabilities arising from obtaining lease right-of-use assets during the year $ - $ 16,617,790 Weighted-average remaining lease term (in years) as of year-end 2.75 11.25 Weighted-average discount rate during the year 9.90 % 13.57 % (1) Operating lease costs is presented net of sublease income that is not material. The Company generally utilizes its incremental borrowing rate based on information available at the commencement of the lease in determining the present value of future payments since the implicit rate for most of the Company’s leases is not readily determinable. Variable lease expense includes rental increases that are not fixed, such as those based on amounts paid to the lessor based on cost or consumption, such as maintenance and utilities. The components of operating lease costs were follows: Schedule of Operating Lease Costs Years Ended December 31, 2021 2020 Operating lease costs: Cost of revenue $ 1,797,327 $ 2,380,002 Selling and marketing 515,868 523,323 General and administrative 405,304 1,151,098 Total operating lease costs (1) $ 2,718,499 $ 4,054,423 (1) Includes certain costs associated with a business membership agreement that permits access to certain office space of $ 75,000 , see below. Maturities of the operating lease liability as of December 31, 2021 are summarized as follows: Summary of Maturity of Lease Liabilities Years Ending December 31, 2022 $ 472,084 2023 486,247 2024 372,829 Minimum lease payments 1,131,160 Less imputed interest ( 171,981 ) Present value of operating lease liability $ 1,159,179 Current portion of operating lease liability $ 373,859 Long-term portion of operating lease liability 785,320 Total operating lease liability $ 1,159,179 Sublease Agreement - In November 2021, the Company entered into an agreement to sublease its leased office space for the duration of its operating lease through September 2024, where it is entitled to receive sublease income of $ 637,000 . In connection with the sublease agreement, the Company: (1) reduced the value of its right-of-use asset and lease liability by $ 1,001,511 based on a remeasurement of its existing operating lease to exclude any renewal options in its lease liability; and (2) recognized a loss on impairment of the lease of $ 466,356 as reflected on the consolidated statements of operations. F- 31 Business Membership – Effective October 1, 2021, the Company entered into a business membership agreement with York Factory LLC, doing business as SaksWorks, that permits access to certain office space with furnishings, referred to as SaksWorks Memberships (each membership provides a certain number of accounts that equate to the use of the space granted). The term of the agreement is for twenty-seven months, with an initial period of three months at $ 25,000 per month for 30 accounts and secondary period for the remaining twenty-four months at $ 56,617 per month for 110 accounts. The agreement also provides for: (1) additional accounts at predetermined pricing; (2) an early termination date of June 30, 2023, providing the Company gives notice by December 31, 2022; and (3) the renewal of the agreement at the end on the term for a twelve-month period at the then-current market price and pricing structure on such renewal date. Lease Termination – Effective September 30, 2021, the Company terminated a certain lease arrangement for office space and as a result, relinquished the space and derecognized a right-of-use asset of $ 15,673,474 , a lease liability of $ 17,934,940 and recorded a penalty upon termination of $ 9,606,121 (as discounted since the amount of the liability and timing of the Cash Payments, as defined below, are fixed), resulting in a net loss upon termination (or loss on termination of lease), of $ 7,344,655 , which has been reflected on the consolidated statements of operations. In connection with the termination, the Company agreed to pay the landlord cash of $ 10,000,000 (the “Cash Payments”) and $ 1,475,000 in market rate advertising. The Cash Payments are due as follows: $ 1,000,000 on December 1, 2021 (paid in December 2021); $ 1,000,000 on October 1, 2022; $ 4,000,000 on October 1, 2023; and $ 4,000,000 on October 1, 2024. 8. Platform Development Platform development costs are summarized as follows: Summary of Platform Development Costs As of December 31, 2021 2020 Platform development $ 21,997,102 $ 16,027,428 Less accumulated amortization ( 12,698,307 ) ( 8,671,820 ) Net platform development $ 9,298,795 $ 7,355,608 A summary of platform development activity is as follows: Summary of Platform Development Cost Activity As of and for the Years Ended December 31, 2021 2020 Platform development beginning of year $ 16,027,428 $ 10,678,692 Payroll-based costs capitalized during the year 4,818,866 3,750,541 Total capitalized costs 20,846,294 14,429,233 Stock-based compensation 2,045,264 1,608,995 Dispositions during the year ( 894,456 ) ( 10,800 ) Platform development end of year $ 21,997,102 $ 16,027,428 Amortization expense for platform development for the years ended December 31, 2021 and 2020, was $ 4,485,384 and $ 3,890,966 , respectively, is included within cost of revenues on the consolidated statements of operations. F- 32 9. Intangible Assets Intangible assets subject to amortization consisted of the following: Schedule of Intangible Assets Subjects to Amortization Weighted Average As of December 31, 2021 As of December 31, 2020 Useful Life (in years) Carrying Amount Accumulated Amortization Net Carrying Amount Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology 4.80 $ 17,579,477 $ ( 11,465,869 ) $ 6,113,608 $ 19,070,857 $ ( 8,283,740 ) $ 10,787,117 Noncompete agreement - 480,000 ( 480,000 ) - 480,000 ( 480,000 ) - Trade name 11.95 3,328,000 ( 781,942 ) 2,546,058 3,328,000 ( 503,342 ) 2,824,658 Brand name 10.00 5,175,136 ( 297,584 ) 4,877,552 - - - Subscriber relationships 5.06 73,458,799 ( 32,622,245 ) 40,836,554 73,458,799 ( 18,105,041 ) 55,353,758 Advertiser relationships 9.42 2,240,000 ( 570,391 ) 1,669,609 2,240,000 ( 332,515 ) 1,907,485 Database 3.70 2,396,887 ( 1,103,771 ) 1,293,116 1,140,000 ( 531,183 ) 608,817 Subtotal amortizable intangible assets 104,658,299 ( 47,321,802 ) 57,336,497 99,717,656 ( 28,235,821 ) 71,481,835 Website domain name - 20,000 - 20,000 20,000 - 20,000 Total intangible assets $ 104,678,299 $ ( 47,321,802 ) $ 57,356,497 $ 99,737,656 $ ( 28,235,821 ) $ 71,501,835 Developed technology, noncompete agreement, trade name, subscriber relationships, advertiser relationships, and database intangible assets subject to amortization were recorded as part of the Company’s business acquisitions. The website domain name has an infinite life and is not being amortized. Amortization expense for the years ended December 31, 2021 and 2020 was $ 20,247,493 and $ 20,301,665 , respectively. Amortization expense for developed technology and platform development of $ 4,343,641 and $ 4,659,986 for the years ended December 31, 2021 and 2020, respectively, are included within cost of revenues on the consolidated statements of operations. No impairment charges have been recorded during the years ended December 31, 2021 and 2020. Estimated total amortization expense for the next five years and thereafter related to the Company’s intangible assets subject to amortization as of December 31, 2021 is as follows: Schedule of Future Estimated Amortization Expenses for Intangible Assets Years Ending December 31, 2022 $ 19,862,367 2023 18,396,551 2024 12,141,759 2025 1,139,834 2026 1,139,834 Thereafter 4,656,152 Intangible assets, net $ 57,336,497 10. Other Assets Other assets are summarized as follows: Summary of Other Assets As of December 31, 2021 2020 Security deposit $ 110,418 $ 110,418 Other deposits - 15,400 Prepaid expenses 528,733 732,309 Prepaid supplies - 472,685 Other assets $ 639,151 $ 1,330,812 F- 33 11. Goodwill The changes in carrying value of goodwill as follows: Schedule of Changes in Carrying Value of Goodwill As of December 31, 2021 2020 Carrying value at beginning of year $ 16,139,377 $ 16,139,377 Goodwill acquired in acquisition of The Spun 3,479,290 - Carrying value at end of year $ 19,618,667 $ 16,139,377 The Company performs its annual impairment test at the reporting unit level, which is the operating segment or one level below the operating segment. Management determined that the Company would be aggregated into a single reporting unit for purposes of performing the impairment test for goodwill. For the years ended December 31, 2021 and 2020, the Company as part of its annual evaluations utilized the option to first assess qualitative factors to determine whether it was necessary to perform the quantitative goodwill impairment assessment. As part of this assessment, the Company reviews qualitative factors which include, but are not limited to, economic, market and industry conditions, as well as the financial performance of its reporting unit. In accordance with applicable guidance, an entity is not required to calculate the fair value of its reporting unit if, after assessing these qualitative factors, the Company determines that it is more likely than not that the fair value of its reporting unit is greater than its respective carrying amount. The annual impairment test was performed on December 31, 2020. No impairment of goodwill has been identified during the years ended December 31, 2021 and 2020. 12. Restricted Stock Liabilities On December 15, 2020, the Company entered into an amendment for certain restricted stock awards and units that were previously issued to certain employees in connection with the HubPages merger. Pursuant to the amendment: ● the restricted stock awards ceased to vest and all unvested shares were deemed unvested and forfeited, leaving an aggregate of 48,389 shares vested; ● the restricted stock units were modified to vest on December 31, 2020, and as of the close of business on December 31, 2020, each restricted stock unit was terminated and deemed forfeited, with no shares vesting thereunder; and ● subject to certain conditions, the Company agreed to purchase the vested restricted stock awards and restricted stock units, at a price of $ 88.00 per share in 24 equal monthly installments on the second business day of each calendar month beginning on January 4, 2021. As a result of the modification of the equity-based awards, the Company recognized $ 334,328 of incremental stock-based compensation costs at the time of the modification and recorded $ 3,800,734 as a reclassification of restricted stock awards and units from equity to liability classified upon modification, as reflected within additional paid-in capital on the consolidated statements of stockholders’ deficiency. The following table presents the components of the restricted stock liabilities: Schedule of Components of Restricted Stock liabilities As of December 31, 2021 2020 Restricted stock liabilities (before imputed interest) $ 3,800,734 $ 4,258,196 Less imputed interest ( 177,425 ) ( 457,462 ) Present value of restricted stock liabilities 3,623,309 3,800,734 Less payments during the years ( 1,471,591 ) ( 177,425 ) Restricted stock liabilities at end of year $ 2,151,718 $ 3,623,309 Current portion of restricted stock liabilities (reflected in accrued expenses and other) $ 2,151,718 $ 1,627,499 Long-term portion of restricted stock liabilities - 1,995,810 Total restricted stock liabilities at end of year $ 2,151,718 $ 3,623,309 The Company recorded the repurchase of restricted stock of the Company’s common stock 22,178 during the years ended December 31, 2021 on the consolidated statements of stockholders’ deficiency. F- 34 13. Accrued Expenses and Other Accrued expenses and other are summarized as follows: Schedule of Accrued Expenses As of December 31, 2021 2020 General accrued expenses $ 4,491,283 $ 4,116,875 Accrued payroll and related taxes 7,124,180 2,519,903 Accrued publisher expenses 6,319,068 3,956,114 Deferred cash payments in connection with acquisitions 655,928 - Sales tax liability 778,774 1,063,515 Restricted stock liabilities 2,151,718 1,627,499 Lease termination liability 1,845,981 - Other 643,637 1,434,287 Total accrued expenses $ 24,010,569 $ 14,718,193 14. Line of Credit FastPay Credit Facility – On December 6, 2021, the Company entered into an amendment to its financing and security agreement for its line of credit with FPP Finance LLC (“FastPay”) that was originally entered into on February 27, 2020, pursuant to which (i) the maximum amount of advances available was increased to $ 25,000,000 from $ 15,000,000 , (ii) the interest rate on the facility applicable margin was decreased to 6.00 % per annum from 8.50 % per annum (the facility bears interest at the LIBOR rate plus the applicable margin), and (iii) the maturity date was extended to February 28, 2024 . The line of credit is for working capital purposes and is secured by a first lien on all the Company’s cash and accounts receivable and a second lien on all other assets. As of December 31, 2021, the balance outstanding under the FastPay line of credit was $ 11,988,194 . SallyPort Credit Facility – As of January 1, 2020, Sallyport collected accounts receivable in excess of the balance outstanding under the note, therefore, the Company was due $ 626,532 from Sallyport which was reflected within accounts receivable on the consolidated balance sheets. Effective January 30, 2020, the Company’s factoring facility with Sallyport was closed and funds were no longer available for advance. 15. Liquidated Damages Payable Liquidated Damages payable are summarized as follows: Summary of Liquidated Damages As of December 31, 2021 Registration Rights Damages Public Information Failure Damages Accrued Interest Balance MDB Common Stock to be Issued (1) $ 15,001 $ - $ - $ 15,001 Series H Preferred Stock 1,163,955 1,171,809 792,365 3,128,129 12 % Convertible Debentures - 873,092 242,325 1,115,417 Series I Preferred Stock 1,386,000 1,386,000 612,877 3,384,877 Series J Preferred Stock 1,560,000 1,560,000 489,797 3,609,797 Series K Preferred Stock 180,420 721,680 50,134 952,234 Total $ 4,305,376 $ 5,712,581 $ 2,187,498 $ 12,205,455 F- 35 As of December 31, 2020 Registration Rights Damages Public Information Failure Damages Accrued Interest Balance MDB Common Stock to be Issued (1) $ 15,001 $ - $ - $ 15,001 Series H Preferred Stock 1,163,955 1,163,955 481,017 2,808,927 12 % Convertible Debentures - 905,490 134,466 1,039,956 Series I Preferred Stock 1,386,000 1,386,000 332,185 3,104,185 Series J Preferred Stock 1,200,000 1,200,000 200,022 2,600,022 Total $ 3,764,956 $ 4,655,445 $ 1,147,690 $ 9,568,091 (1) Consists of shares of common stock issuable to MDB Capital Group, LLC (“MDB”). For the years ended December 31, 2021 and 2020, liquidated damages payables were $ 12,205,455 (short-term of $ 5,197,182 and long-term of $ 7,008,273 ) and $ 9,568,091 (short-term of $ 9,568,091 and long-term of none ), respectively. The Company will continue to accrue interest on the Liquidated Damages balance at 1 % per month based on the balance outstanding until paid. There is no scheduled date when the unpaid Liquidated Damages become due. Information with respect to the Liquidated Damages recognized on the consolidated statements of operations is provided in Note 23. 16. Other Long-term Liabilities Other long-term liabilities consisted of the following: Schedule of Other long-term liabilities As of December 31, 2021 2020 Lease termination liability $ 6,928,053 $ 541,381 Deferred cash payment liabilities 410,037 - Other 218,175 211,984 Other long-term liabilities $ 7,556,265 $ 753,365 17. Fair Value Measurements The Company’s financial instruments consist of Level 1, Level 2 and Level 3 assets as of December 31, 2021 and 2020. As of December 31, 2021 and 2020, the Company’s cash and cash equivalents of $ 9,349,020 and $ 9,033,872 , respectively, were Level 1 assets and included savings deposits, overnight investments, and other liquid funds with financial institutions. Financial instruments measured at fair value during the year consisted of the following: Schedule of Fair Value of Financial Instruments As of December 31, 2021 Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Senior Secured Note $ 60,756,285 $ - $ 60,756,285 $ - F- 36 As of December 31, 2020 Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Senior Secured Note $ 52,556,401 $ - $ 52,556,401 $ - Warrant derivative liabilities: Strome Warrants $ 704,707 $ - $ - $ 704,707 B. Riley Warrants 443,188 - - 443,188 Total warrant derivative liabilities $ 1,147,895 $ - $ - $ 1,147,895 Senior Secured Note – The carrying value of the Senior Secured Note (as defined below) approximates fair value based on current market interest rates for debt instruments of similar credit standing and, consequently, their fair values are based on Level 2 inputs. The quantitative information utilized in the fair value calculation of the Level 3 liabilities are as follows: Unearned Revenue – The fair value of unearned revenue remaining in connection with the 2019 acquisition of Sports Illustrated media business, was determined with the following inputs: (1) projection of when unearned revenue will be earned; (2) expense necessary to fulfill the subscriptions; (3) gross up of the fulfillment costs to include a market participant level of profitability; (4) slight premium to the fulfillment-costs plus a reasonable profit metric; and (5) reduce projected future cash flows to present value using an appropriate discount rate. The unearned revenue remaining from the acquisition as of December 31, 2021 was $ 4,855,167 and $ 14,071,065 , respectively, on the consolidated balance sheets. The changes in unearned revenue with inputs classified as Level 3 of the fair value hierarchy are reflected within revenue on the consolidated statements of operations. Warrant Derivative Liabilities – The Company accounted for certain warrants of the 12 % Convertible Debentures (as described in Note 18) as derivative liabilities, which required the Company carry such amounts on its consolidated balance sheets as a liability at fair value, as adjusted at each reporting period-end. The Company determined the fair value of the Strome Warrants and B. Riley Warrants (all as described in Note 21) utilizing the Black-Scholes valuation model as further described below. These warrants were classified as Level 3 within the fair-value hierarchy. Inputs to the valuation model include the Company’s publicly quoted stock price, the stock volatility, the risk-free interest rate, the remaining life of the warrants, the exercise price or conversion price, and the dividend rate. The Company uses the closing stock price of its common stock over an appropriate period of time to compute stock volatility. These assumptions are summarized as follows: Strome Warrants – 2021 assumptions upon reclassification to equity: Black-Scholes option-pricing; expected life: 1.54 years; risk-free interest rate: 0.60 %; volatility factor: 146.68 %; dividend rate: 0.0 %; transaction date closing market price: $ 0.62 ; exercise price: $ 0.50 ; and 2020 assumptions: Black-Scholes option-pricing; expected life: 2.45 ; risk-free interest rate: 0.13 %; volatility factor: 150.55 %; dividend rate: 0.0 %; transaction date closing market price: $ 0.60 ; exercise price: $ 0.50 . B. Riley Warrants – 2021 assumptions upon reclassification to equity: Black-Scholes option-pricing; expected life: 3.88 years; risk-free interest rate: 1.14 %; volatility factor: 144.61 %; dividend rate: 0.0 %; transaction date closing market price: $ 0.62 ; exercise price: $ 0.33 ; and 2020 assumptions: Black-Scholes option-pricing; expected life: 4.79 years; risk-free interest rate: 0.36 %; volatility factor: 140.95 %; dividend rate: 0.0 %; transaction date closing market price: $ 0.60 ; exercise price: $ 0.33 . F- 37 The following table represents the carrying amounts and change in valuation for the Company’s warrants accounted for as a derivative liability and classified within Level 3 of the fair-value hierarchy as of and for the years ended December 31, 2021 and 2020: Schedule of Valuation Activity for Warrants Accounted for Derivative Liability As of and for the Years Ended December 31, 2021 2020 Carrying Amount at Beginning of Year Change in Valuation Reclassification to Equity Carrying Amount at End of Year Carrying Amount at Beginning of Year Change in Valuation Carrying Amount at End of Year Strome Warrants $ 704,707 $ ( 75,179 ) $ ( 629,528 ) $ - $ 1,036,687 $ ( 331,980 ) $ 704,707 B. Riley Warrants 443,188 40,687 ( 483,875 ) - 607,513 ( 164,325 ) 443,188 Total $ 1,147,895 $ ( 34,492 ) $ ( 1,113,403 ) $ - $ 1,644,200 $ ( 496,305 ) $ 1,147,895 For the years ended December 31, 2021 and 2020, the change in valuation of warrant derivative liabilities recognized within other (expense) income on the consolidated statements of operations, as described in the above table of $ 34,492 and $ 496,305 , respectively. The Strome Warrants and B. Riley Warrants were reclassified to equity upon filing an effective registration statement during the year ended December 31, 2021, resulting in a $ 1,113,403 offset within additional paid-in capital on the consolidated statements of stockholders’ deficiency. The following table represents the carrying amounts and changes in valuation for the Company’s conversion option features, buy-in features, and default remedy features, as deemed appropriate for each instrument (collectively the embedded derivative liabilities), for the 12 % Convertible Debentures (refer to Note 18) accounted for as embedded derivative liabilities and classified within Level 3 of the fair-value hierarchy as of and for the year ended December 31, 2020: Schedule of Valuation Activity for the Embedded Conversion Feature Liability As of and for the Year Ended December 31, 2020 Carrying Amount at Beginning of Year Change in Valuation Fair Value Recorded within Equity Upon Conversion Carrying Amount at End of Year 12 % Convertible Debentures $ 13,501,000 $ ( 2,571,004 ) $ ( 10,929,996 ) $ - For the year ended December 31, 2020, the change in valuation of embedded derivative liabilities as described in the above table of $ 2,571,004 was recognized as other expense on the consolidated statements of operations. As a result of the conversion of certain 12 % Convertible Debentures into shares of the Company’s common stock, the Company recorded the fair value of the embedded derivative liabilities of the conversion option features, buy-in features, and default remedy features of $ 10,929,996 within additional paid-in capital on the consolidated statements of stockholders’ deficiency (as further described in Note 18). As of December 31, 2020, there was no longer any principal or accrued but unpaid interest outstanding under the 12 % Convertible Debentures since certain holders converted the debt into shares of the Company’s common stock and certain holders were paid in cash. 18. Convertible Debt The Company had various financings through the issuance of 12 % senior subordinated convertible debentures during 2018 and 2019 that were due and payable on December 31, 2020 (the “ 12 % Convertible Debentures”). In connection with the issuance of the 12 % Convertible Debentures the Company recognized certain embedded derivative liabilities that were bifurcated from the note instruments, consisting of a: (i) conversion option; (ii) buy-in feature; and (iii) default remedy feature, which required the Company to carry such amounts on its consolidated financial statements as a liability at fair value, as adjusted at each period-end. The Company also incurred debt issuance cost. The embedded derivative liabilities and debt issuance cost were treated as a debt discount and amortized over the term of the debt. F- 38 The Company entered into a registration rights agreements in connection with the securities purchase agreements, where the Company agreed to register the shares issuable upon conversion of the 12% Convertible Debentures for resale by the holders within a certain timeframe and subject to certain conditions. The registration rights agreement provides for a cash payment equal to 1.0% per month of the amount invested as partial liquidated damages upon the occurrence of certain events, on each monthly anniversary, up to a maximum amount of 6.0% of the aggregate amount invested, subject to interest at 12.0% per annum, accruing daily, until paid in full . The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). The securities purchase agreements also included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement after 6 months of the closing date, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full . The securities purchase agreements provide for Public Information Failure Damages (further details are provided in Note 15). The Company recognized a portion of the Public Information Failure Damages pursuant to the securities purchase agreements in connection with the 12% Convertible Debentures at the time of issuance as it was deemed probable the obligations would not be satisfied when the financings were completed (see Note 15). On December 31, 2020, certain holders converted the 12% Convertible Debentures representing an aggregate of $ 18,104,949 of the then-outstanding principal and accrued but unpaid interest into 2,449,431 shares of the Company’s common stock at effective conversion per-share prices ranging from $ 7.26 to $ 8.80 . Further, the Company repaid an aggregate of $ 1,130,903 of the 12% Convertible Debentures, including the then-outstanding principal and accrued interest, in cash. With respect to the conversion of the accrued interest into shares of the Company’s common stock, the Company recognized a loss on conversion of $ 3,297,539 at the time of conversion on the consolidated statements of operations. Upon conversion of the 12% Convertible Debentures, the Company recorded the aggregate outstanding principal and loss on conversion of the accrued interest of $ 21,402,488 within additional paid-in capital on the consolidated statements of stockholders’ deficiency. F- 39 The following table represents the various components of the 12 % Convertible Debentures as of and for the year ended December 31, 2020: Schedule of 12% Convertible Debentures Issuance Date Total 12% December 12, 2018 March 18, 2019 March 27, 2019 April 8, 2019 Convertible Debentures Principal amount of debt: $ 9,540,000 $ 1,696,000 $ 318,000 $ 100,000 $ 11,654,000 Less: issuance costs ( 590,000 ) ( 96,000 ) ( 18,000 ) - ( 704,000 ) Net cash proceeds received $ 8,950,000 $ 1,600,000 $ 300,000 $ 100,000 $ 10,950,000 Principal amount of debt (excluding original issue discount) $ 9,540,000 $ 1,696,000 $ 318,000 $ 100,000 $ 11,654,000 Add: conversion of debt from convertible debentures 3,551,528 - - - 3,551,528 Add: accrued interest 3,540,899 393,989 72,738 22,698 4,030,324 Principal amount of debt including accrued interest 16,632,427 2,089,989 390,738 122,698 19,235,852 Less: conversion in connection with issuance of common stock ( 15,870,143 ) ( 2,089,989 ) ( 22,119 ) ( 122,698 ) ( 18,104,949 ) Less: repayments in cash ( 762,284 ) - ( 368,619 ) - ( 1,130,903 ) Principal amount of debt - - - - - Debt discount: Allocated embedded derivative liabilities at issuance ( 4,760,000 ) ( 822,000 ) ( 188,000 ) ( 64,000 ) ( 5,834,000 ) Liquidated Damages recognized upon issuance ( 706,944 ) ( 67,200 ) ( 12,600 ) ( 4,200 ) ( 790,944 ) Issuance cost incurred at issuance ( 590,000 ) ( 106,000 ) ( 18,000 ) - ( 714,000 ) Total debt discount ( 6,056,944 ) ( 995,200 ) ( 218,600 ) ( 68,200 ) ( 7,338,944 ) Less: amortization of debt discount 6,056,944 995,200 218,600 68,200 7,338,944 Debt discount - - - - - 12% Convertible Debentures balance at December 31, 2020 $ - $ - $ - $ - $ - For additional information for the year ended December 31, 2020 with respect to interest expense related to the 12% Convertible Debentures is provided in Note 19 . 19. Long-term Debt Senior Secured Note Below is a summary of the various amended and restated note, as well as various amendments thereto, to the senior secured note with BRF Finance Co., LLC (“BRF Finance”), an affiliated entity of B. Riley, in its capacity as agent for the purchasers and as purchaser, that was originally issued on June 10, 2019, for gross proceeds of $ 20,000,000 . The transactions leading up to the second amended and restated note that is outstanding as of December 31, 2021 consisted of: ● Amended and restated note issued on June 14, 2019, where the Company received gross proceeds of $ 48,000,000 , together with the $ 20,000,000 gross proceeds received on June 10, 2019 for total gross proceeds of $ 68,000,000 , due June 14, 2022; ● First amendment to the amended and restated note issued on August 27, 2019, where the Company received gross proceeds of $ 3,000,000 ; F- 40 ● Second amendment to the amended and restated note issued on February 27, 2020, where the Company issued a $ 3,000,000 letter of credit to the Company’s landlord for leased premises; ● Second amended and restated note issued on March 24, 2020, where the Company was permitted to enter into a Delayed Draw Term Note (as described below), in the aggregate principal amount of $ 12,000,000 ; ● First amendment to second amended and restated note issued on March 24, 2020 was entered into on October 23, 2020 (“Amendment 1”), where the maturity date was changed to December 31, 2022, subject to certain acceleration conditions and interest payable on the note on September 30, 2020, December 31, 2020, March 31, 2021, June 30, 2021, September 30, 2021, and December 31, 2021 will be payable in-kind in arrears on the last day of such fiscal quarter. Alternatively, at the option of the holder, such interest amounts originally could have been paid in shares of Series K convertible preferred stock (the “Series K Preferred Stock”); however, after December 18, 2020, the date the Series K Preferred Stock converted into shares of the Company’s common stock, such interest amounts can be converted into shares of the Company’s common stock based upon the conversion rate specified in the Certificate of Designation for the Series K Preferred Stock, subject to certain adjustments (further details are described in Note 20); ● Second amendment to the second amended and restated note issued March 24, 2020 was entered into on May 19, 2021 (“Amendment 2”), pursuant to which: (i) the interest rate on the Senior Secured Note, as defined below, decreased from a rate of 12 % per annum to a rate of 10 % per annum; and (ii) the Company agreed that within one (1) business day after receipt of cash proceeds from any issuance of equity interests, it will prepay the certain obligations in an amount equal to such cash proceeds, net of underwriting discounts and commissions; provided, that, this mandatory prepayment obligation does not apply to any proceeds that the Company received from shares of the Company’s common stock issued pursuant to the securities purchase agreement (as further described below under the heading Common Stock Private Placement in Note 21) during the 90-day period commencing on May 20, 2021; and ● Third amendment to the second amended and restated note issued March 24, 2020 was entered into on December 6, 2021 (“Amendment 3”), where the Company was permitted to increase the FastPay line of credit in an aggregate principal amount not to exceed $ 25,000,000 . Collectively, the amended and restated note and amendments thereto and the second amended and restated note and Amendment 1, Amendment 2 and Amendment 3 thereto are referred to as the “Senior Secured Note,” with all borrowings collateralized by substantially all assets of the Company. Further details as of the date these consolidated financial statements were issued are provided under the heading Long-term Debt in Note 28. Delayed Draw Term Note On March 24, 2020, the Company entered into a 15 % delayed draw term note (the “Delayed Draw Term Note”) pursuant to the second amended and restated note purchase agreement, in the aggregate principal amount of $ 12,000,000 . On March 24, 2020, the Company drew down $ 6,913,865 under the Delayed Draw Term Note, and after payment of commitment and funding fees paid of $ 793,109 , and other of its legal fees and expenses that were incurred, the Company received net proceeds of $ 6,000,000 . The net proceeds were used for working capital and general corporate purposes. Additional borrowings under the Delayed Draw Term Note requested by the Company may be made at the option of the purchasers, subject to certain conditions. Up to $ 8,000,000 in principal amount under the note was originally due on March 31, 2021. Interest on amounts outstanding under the note was payable in-kind in arrears on the last day of each fiscal quarter. The transactions leading up to the Delayed Draw Term Note that is outstanding as of December 31, 2021 consisted of: ● Pursuant to the terms of Amendment 1, entered into on October 23, 2020, the maturity date of the Delayed Draw Term Note was changed from March 31, 2021 to March 31, 2022. Amendment 1 also provided that the holder, could originally elect, in lieu of receipt of cash for payment of all or any portion of the interest due or cash payments up to a certain conversion portion of the Delayed Draw Term Note, to receive shares of Series K Preferred Stock; however, after December 18, 2020, the date the Series K Preferred Stock converted into shares of the Company’s common stock, the holder may elect, in lieu of receipt of cash for such amounts, shares of the Company’s common stock at the price the Company last sold shares of the Company’s common stock; ● On October 23, 2020, $ 3,367,000 , including principal and accrued interest of the Delayed Draw Term Note, converted into shares of the Company’s Series K Preferred Stock (see Note 20); ● On May 19, 2021, pursuant to Amendment 2, the interest rate on the Delayed Draw Term Note decreased from a rate of 15 % per annum to a rate of 10 % per annum; and ● On December 28, 2021, the Company drew down $ 5,086,135 under the Delayed Draw Term Note, and after payment of commitment and funding fees paid of $ 508,614 , the Company received net proceeds of $ 4,577,522 . The net proceeds were used for working capital and general corporate purposes. Further details as of the date these consolidated financial statements were issued are provided under the heading Long-term Debt in Note 28. F- 41 The following table represents the components of the Senior Secured Note and Delayed Draw Term Note: Schedule of Senior Secured Notes and Delayed Draw Term Note As of and for the Years Ended December 31, 2021 2020 Senior Secured Note Components Delayed Draw Term Note Components Total Senior Secured Note Components Delayed Draw Term Note Components Total Principal amount of debt: Principal amount of debt received on June 10, 2019 $ 20,000,000 $ - $ 20,000,000 $ 20,000,000 $ - $ 20,000,000 Principal amount of debt received on June 14, 2019 48,000,000 - 48,000,000 48,000,000 - 48,000,000 Principal amount of debt received on August 27, 2019 3,000,000 - 3,000,000 3,000,000 - 3,000,000 Principal amount of debt received on March 26, 2020 - 6,913,865 6,913,865 - 6,913,865 6,913,865 Principal amount of debt received on December 28, 2021 - 5,086,135 5,086,135 - - - Subtotal principal amount of debt 71,000,000 12,000,000 83,000,000 71,000,000 6,913,865 77,913,865 Add accrued interest 13,852,050 1,223,506 15,075,556 7,457,388 675,958 8,133,346 Less principal payment paid in Series J Preferred Stock (net of interest of $ 146,067 ) ( 4,853,933 ) - ( 4,853,933 ) ( 4,853,933 ) - ( 4,853,933 ) Less principal payment paid in Series K Preferred Stock (net of interest of $ 71,495 ) - ( 3,295,505 ) ( 3,295,505 ) - ( 3,295,505 ) ( 3,295,505 ) Less principal payments paid in cash ( 17,307,364 ) - ( 17,307,364 ) ( 17,307,364 ) - ( 17,307,364 ) Principal amount of debt outstanding including accrued interest 62,690,753 9,928,001 72,618,754 56,296,091 4,294,318 60,590,409 Debt discount: Placement fee to B. Riley FBR ( 3,550,000 ) ( 691,387 ) ( 4,241,387 ) ( 3,550,000 ) ( 691,387 ) ( 4,241,387 ) Commitment fee ( 2 % of unused commitment) - ( 101,723 ) ( 101,723 ) - ( 101,723 ) ( 101,723 ) Success based fee to B. Riley FBR ( 3,400,000 ) - ( 3,400,000 ) ( 3,400,000 ) - ( 3,400,000 ) Legal and other costs ( 202,382 ) ( 120,755 ) ( 323,137 ) ( 202,382 ) ( 120,755 ) ( 323,137 ) Commitment fee due December 28, 2021 - ( 508,614 ) ( 508,614 ) - - - Subtotal debt discount ( 7,152,382 ) ( 1,422,479 ) ( 8,574,861 ) ( 7,152,382 ) ( 913,865 ) ( 8,066,247 ) Less amortization of debt discount 5,217,914 855,007 6,072,921 3,412,692 554,693 3,967,385 Unamortized debt discount ( 1,934,468 ) ( 567,472 ) ( 2,501,940 ) ( 3,739,690 ) ( 359,172 ) ( 4,098,862 ) Carrying value at year-end $ 60,756,285 $ 9,360,529 $ 70,116,814 $ 52,556,401 $ 3,935,146 $ 56,491,547 F- 42 Paycheck Protection Program Loan On April 6, 2020, the Company entered into a note agreement with JPMorgan Chase Bank, N.A. (“JPMorgan Chase”) under the recently enacted Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the U.S. Small Business Administration (“SBA”) (the “Paycheck Protection Program Loan”). The Company received total proceeds of $ 5,702,725 under the Paycheck Protection Program Loan. In accordance with the requirements of the CARES Act, the Company used proceeds from the Paycheck Protection Program Loan primarily for payroll costs. The Paycheck Protection Program Loan was scheduled to mature on April 6, 2022 , with a 0.98 % interest rate and was subject to the terms and conditions applicable to loans administered by the SBA under the CARES Act. On June 22, 2021, the SBA authorized full forgiveness of $ 5,702,725 under the Paycheck Protection Program Loan; thus, the Company will not need to make any payments on the Paycheck Protection Program Loan that JPMorgan Chase facilitates as an SBA lender. JPMorgan Chase will apply the forgiveness amount the SBA authorized, plus all accrued interest, to the Company’s Paycheck Protection Program Loan. The requirements under this program are established by the SBA. All requests for Paycheck Protection Program Loan forgiveness are subject to SBA eligibility. The Company recorded a gain upon debt extinguishment for the year ended December 31, 2021 of $ 5,716,697 (including accrued interest) pursuant to the forgiveness in other (expense) income on the consolidated statements of operations. The following table summarizes long-term debt: Schedule of Long Term Debt As of December 31, 2021 2020 Principal Balance (including accrued interest) Unamortized Discount and Debt Issuance Costs Carrying Value Principal Balance (including accrued interest) Unamortized Discount and Debt Issuance Costs Carrying Value Senior Secured Note, as amended, matures December 31, 2023 $ 62,690,753 $ ( 1,934,468 ) $ 60,756,285 $ 56,296,091 $ ( 3,739,690 ) $ 52,556,401 Delayed Draw Term Note, as amended, matures December 31, 2023 9,928,001 ( 567,472 ) 9,360,529 4,294,318 ( 359,172 ) 3,935,146 Paycheck Protection Program Loan, scheduled to mature April 6, 2022, fully forgiven June 22, 2021 - - - 5,702,725 - 5,702,725 Total $ 72,618,754 $ ( 2,501,940 ) 70,116,814 $ 66,293,134 $ ( 4,098,862 ) 62,194,272 Less current portion ( 5,744,303 ) - Long-term portion $ 64,372,511 $ 62,194,272 As of December 31, 2021, the Company’s Delayed Draw Term Note, as amended, carrying value of $ 9,360,529 was as follows: (1) $ 5,744,303 (including accrued interest and less unamortized discount and debt issuance costs of $ 180,365 ); and (2) $ 3,616,226 (including accrued interest and less unamortized discount and debt issuance costs of $ 387,107 ). The following table summarizes principal maturities of long-term debt: Schedule of Principal Maturities of Long-term Debt Years Ending December 31, 2022 $ 5,924,668 2023 66,694,086 Total $ 72,618,754 Information for the years ended December 31, 2021 and 2020 with respect to interest expense related to long-term debt is provided below under the heading Interest Expense . F- 43 Interest Expense The following table represents interest expense: Summary of Interest Expense Years Ended December 31, 2021 2020 Amortization of debt discounts: 12% Convertible Debentures $ - $ 3,880,609 Senior Secured Note 1,805,222 2,171,910 Delayed Draw Term Note 300,314 554,693 Total amortization of debt discount 2,105,536 6,607,212 Accrued and noncash converted interest: 12% Convertible Debentures - 2,116,281 Senior Secured Note 6,394,662 6,374,746 Delayed Draw Term Note 547,548 747,453 Payroll Protection Program Loan 13,972 - Promissory Note - 5,844 Total accrued and noncash converted interest 6,956,182 9,244,324 Cash paid interest: Other 1,392,900 645,681 Total interest expense $ 10,454,618 $ 16,497,217 20. Preferred Stock The Company has the authority to issue 1,000,000 shares of preferred stock, $ 0.01 par value per share, consisting of authorized and/or outstanding shares as of December 31, 2021 as follows: ● 2,000 authorized shares were designated as “Series F Convertible Preferred Stock”, none of which were outstanding. The Series F Convertible Preferred Stock was eliminated on September 7, 2021. ● 1,800 authorized shares designated as “Series G Convertible Preferred Stock” (as further described below), of which 168,496 shares are outstanding. ● 23,000 authorized shares designated as “Series H Convertible Preferred Stock” (as further described below), of which 15,066 shares are outstanding. ● 25,800 authorized shares were designated as “Series I Convertible Preferred Stock” on June 27, 2019, none of which were outstanding (as further described below). The Series I Convertible Preferred Stock was eliminated on September 7, 2021. ● 35,000 authorized shares were designated as “Series J Convertible Preferred Stock” on October 4, 2019, none of which were outstanding (as further described below). The Series J Convertible Preferred Stock was eliminated on September 7, 2021. ● 20,000 authorized shares were designated as “Series K Convertible Preferred Stock” on October 22, 2020, none of which were outstanding (as further described below). The Series K Convertible Preferred Stock was eliminated on September 7, 2021. Series G Preferred Stock On May 30, 2000, the Company sold 1,800 shares of its Series G Convertible Preferred Stock (the “Series G Preferred Stock”), of which 1,631.504 were converted prior to November 2001 and 168.496 shares continue to be outstanding, at a stated value of $ 1,000 per share, convertible into 8,582 shares of the Company’s common stock. The Series G Preferred Stock is convertible into shares of common stock, at the option of the holder, subject to certain limitations. The Company may require holders to convert all (but not less than all) of the Series G Preferred Stock or buy out all outstanding shares of Series G Preferred Stock at the liquidation value of $ 168,496 . Holders of Series G Preferred Stock are not entitled to dividends and have no voting rights, unless required by law or with respect to certain matters relating to the Series G Preferred Stock. F- 44 Upon a change in control, sale of or similar transaction, as defined in the Certificate of Designation for the Series G Preferred Stock, the holder of the Series G Preferred Stock has the option to deem such transaction as a liquidation and may redeem their 168.496 shares at the liquidation value of $ 1,000 per share, or an aggregate amount of $ 168,496 . The sale of all the assets of the Company on June 28, 2007 triggered the redemption option. As such redemption was not in the control of the Company, the Series G Preferred Stock has been accounted for as if it is redeemable preferred stock and is classified on the consolidated balance sheets as a mezzanine obligation between liabilities and stockholders’ deficiency. Series H Preferred Stock On August 10, 2018 (the “Closing Date”), the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which the Company issued an aggregate of 19,399 shares of Series H Convertible Preferred Stock (the “Series H Preferred Stock”) at a stated value of $ 1,000 , initially convertible into 2,672,176 shares of the Company’s common stock, at the option of the holder subject to certain limitations, at a conversion rate equal to the stated value divided by the conversion price of $ 7.26 per share, for aggregate gross proceeds of $ 19,399,250 (net proceeds of $ 18,045,496 after taking into consideration issuance costs or $ 1,353,754 ). Between August 14, 2020 and August 20, 2020, the Company entered into additional securities purchase agreements for the sale of Series H Preferred Stock with accredited investors, pursuant to which the Company issued 108 shares (after it rescinded the issuance of 2,145 shares that were deemed null and void and repaid to certain holders on October 28, 2020), at a stated value of $ 1,000 per share, initially convertible into 14,877 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $ 7.26 per share, for aggregate gross proceeds of $ 130,896 (net proceeds of $ 113,000 after taking into consideration issuance costs), which was used for working capital and general corporate purposes. On October 31, 2020, the Company issued 389 shares of Series H Preferred Stock to James Heckman at the stated value of $ 1,000 , convertible into 53,582 shares of the Company’s common stock, at the option of the holder subject to certain limitations at a conversion rate equal to the stated value divided by the conversion price of $ 7.26 per share. The shares of Series H Preferred Stock were issued in connection with the cancellation of promissory notes payable to Mr. Heckman in the aggregate outstanding principal amount of $ 389,000 . The number of shares issuable upon conversion of the Series H Preferred Stock will be adjusted in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each Series H Preferred Stock votes on an as-if-converted to common stock basis, subject to beneficial ownership blocker provisions and other certain conditions. In addition, if at any time the Company grants, issues or sells any common stock equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of common stock (the “Purchase Rights”), then a holder of the Series H Preferred Stock will be entitled to acquire the aggregate Purchase Rights which the holder could have acquired if the holder had held the number of shares of common stock acquirable upon complete conversion of such holder’s Series H Preferred Stock immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, subject to certain conditions, adjustments, and limitations. All the shares of Series H Preferred Stock automatically convert into shares of the Company’s common stock on the fifth anniversary of the Closing Date at the conversion price of $ 7.26 per share. The shares of Series H Preferred Stock were subject to limitations on conversion into shares of the Company’s common stock until the date that increased the number of authorized shares of its common stock to at least a number permitting all the Series H Preferred Stock to be converted in full, which was filed on December 18, 2020, therefore this limitation was removed (as further described in Note 21). F- 45 Pursuant to the registration rights agreement entered into on August 10, 2018, in connection with the securities purchase agreements, the Company agreed to register the shares issuable upon conversion of the Series H Preferred Stock for resale by the holders. The Company committed to file the registration statement by no later than 75 days after the closing date and to cause the registration statement to become effective, in general, by no later than 120 days after the closing date (or, in the event of a full review by the staff of the SEC, 150 days following the closing date). The registration rights agreement provides for a cash payment equal to 1.0% per month of the amount invested as partial liquidated damages, on each monthly anniversary, payable within 7 days of such event, and upon the occurrence of certain events up to a maximum amount of 6.0% of the aggregate amount invested, subject to interest at 12.0% per annum, accruing daily, until paid in full. The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). The securities purchase agreements entered into on August 10, 2018, included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement after 6 months of the closing date, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. The securities purchase agreements provide for Public Information Failure Damages (further details are provided in Note 15). The following table represents the components of the Series H Preferred Stock for the years ended and as of December 31, 2021 and 2020: Schedule of Components of Preferred Stock Series H Preferred Shares Stock Components Issuance of Series H Preferred Stock at January 1, 2020 19,399 $ 19,399,250 Less issuance costs ( 1,353,754 ) Net issuance of Series H Preferred Stock at January 1, 2020 18,045,496 Issuance of Series H Preferred Stock on August 19, 2020: Issuance of Series H Preferred Stock (as further described below) 108 130,896 Less issuance costs netted from the proceeds ( 17,896 ) Net proceeds received upon issuance of Series H Preferred Stock 113,000 Conversion of Series H Preferred Stock into common stock on September 21, 2020 ( 300 ) ( 300,000 ) Issuance of Series H Preferred Stock upon conversion of promissory note on November 13, 2020 (as further described below) 389 389,000 Net issuance of Series H Preferred Stock during the year ended December 31, 2020 197 202,000 Series H Preferred Stock at December 31, 2020 19,596 $ 18,247,496 Conversion of Series H Preferred Stock: Conversion of Series H Preferred Stock into common stock on August 17, 2021 ( 50 ) ( 50,000 ) Conversion of Series H Preferred Stock into common stock on November 22, 2021 ( 4,011 ) ( 4,011,000 ) Conversion of Series H Preferred Stock into common stock on December 21, 2021 ( 469 ) ( 469,000 ) Total conversion of Series H Preferred Stock ( 4,530 ) ( 4,530,000 ) Series H Preferred Stock at December 31, 2021 15,066 $ 13,717,496 During the year ended December 31, 2020, in connection with the issuance of 108 shares (issued on August 19, 2020) and 389 shares (issued on October 31, 2020) of Series H Preferred Stock, the Company recognized a beneficial conversion feature of $ 113,000 and $ 389,000 (totaling $ 502,000 ), respectively, for the underlying common shares since the nondetachable conversion feature was in-the-money (the conversion price of $ 7.26 was lower than the Company’s common stock trading price of $ 18.92 and $ 16.94 at the issuance date of August 19, 2020 and October 31, 2020, respectively). The beneficial conversion feature was recognized as a deemed dividend with an offset to additional paid-in capital. F- 46 The Company recorded the issuance of shares of the Company’s common stock upon conversion of the Series H Preferred Stock of 624,111 and 41,323 during the years ended December 31, 2021 and 2020, respectively, on the consolidated statements of stockholders’ deficiency. Series I Preferred Stock On June 28, 2019, the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which the Company issued an aggregate of 23,100 shares of Series I Convertible Preferred Stock (the “Series I Preferred Stock”) at a stated value of $ 1,000 , initially convertible into 2,100,000 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $ 11.00 per share, for aggregate gross proceeds of $ 23,100,000 (net proceeds of $ 19,699,742 after taking into consideration issuance costs of $ 1,459,858 and Liquidated Damages recognized upon issuance of $ 1,940,400 ). Each Series I Preferred Stock votes on an as-if-converted to common stock basis, subject to certain conditions. Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements on June 28, 2019, the Company agreed to register the shares issuable upon conversion of the Series I Preferred Stock for resale by the investors. The Company committed to file the registration statement no later than the 30th calendar day following the date the Company files (i) its Annual Report on Form 10-K for the fiscal year ended December 31, 2018, (ii) all its required quarterly reports on Form 10-Q since the quarter ended September 30, 2018 through September 30, 2019, and (iii) current Form 8-K in connection with the acquisitions of TheStreet and its license with ABG, with the SEC, but in no event later than December 1, 2019. The Company committed to cause the registration statement to become effective by no later than 90 days after December 1, 2019, subject to certain conditions and upon the occurrence of certain events up to a maximum amount of 6 % of the aggregate amount invested. The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). The securities purchase agreements included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement after 6 months of the closing date, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. The securities purchase agreements provide for Public Information Failure Damages (further details are provided in Note 15). The Company recognized a portion of the Liquidated Damages pursuant to the registration rights and securities purchase agreements in connection with the Series I Preferred Stock at the time of issuance as it was deemed probable the obligations would not be satisfied when the financing was completed (further details are presented in the table below). The following table represents the components of the Series I Preferred Stock as of and for the year ended December 31, 2020: Schedule of Components of Preferred Stock Shares Series I Preferred Stock Components Issuance of Series I Preferred Stock at January 1, 2020 23,100 $ 23,100,000 Less costs recognized upon issuance: Issuance costs incurred upon issuance ( 1,459,858 ) Liquidated Damages recognized upon issuance ( 1,940,400 ) Total issuance costs and Liquidated Damages ( 3,400,258 ) Net issuance of Series I Preferred Stock at January 1, 2020 23,100 19,699,742 Conversion of Series I Preferred Stock into common stock on December 18, 2020 (as further described below) ( 23,100 ) ( 19,699,742 ) Series I Preferred Stock at December 31, 2020 - $ - All the shares of Series I Preferred Stock converted automatically into shares of the Company’s common stock on December 18, 2020, as a result of the increase in the number of authorized shares of the Company’s common stock (as further described in Note 21). Upon conversion the Company recognized a beneficial conversion feature of $ 5,082,000 for the underlying common shares since the nondetachable conversion feature was in-the-money (the conversion price of $ 11.00 was lower than the Company’s common stock trading price of $ 13.42 at the conversion date). The beneficial conversion feature was recognized as a deemed dividend with an offset to additional paid-in capital. F- 47 The Company recorded the issuance of shares of the Company’s common stock upon conversion of the Series I Preferred Stock of 2,100,000 during the year ended December 31, 2020 on the consolidated statements of stockholders’ deficiency. Series J Preferred Stock On October 7, 2019, the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which the Company issued an aggregate of 20,000 shares of Series J Convertible Preferred Stock (the “Series J Preferred Stock”) at a stated value of $ 1,000 , initially convertible into 1,299,091 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $ 15.40 per share, for aggregate gross proceeds of $ 20,000,000 (net proceeds of $ 17,739,996 after taking into consideration issuance costs of $ 580,004 and Liquidated Damages recognized upon issuance of $ 1,680,000 ). Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements on October 7, 2019, the Company agreed to register the shares issuable upon conversion of the Series J Preferred Stock for resale by the investors. The Company committed to file the registration statement no later than the 30th calendar day following the date the Company files (i) its Annual Report on Form 10-K for the fiscal year ended December 31, 2018, (ii) all its required quarterly reports on Form 10-Q since the quarter ended September 30, 2018 through September 30, 2019, and (iii) current Form 8-K in connection with the acquisition of TheStreet, and other acquisitions during 2018, and its license with ABG, with the SEC, but in no event later than March 31, 2020. The Company committed to cause the registration statement to become effective by no later than 90 days after March 31, 2020, subject to certain conditions and upon the occurrence of certain events up to a maximum amount of 6 % of the aggregate amount invested. The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). The Company recognized a portion of the Liquidated Damages pursuant to the registration rights and securities purchase agreements in connection with the Series J Preferred Stock at the time of issuance as it was deemed probable the obligations would not be satisfied when the financing was completed (further details are presented in the table below). On September 4, 2020, the Company closed on securities purchase agreements with two accredited investors, pursuant to which the Company issued an aggregate of 10,500 shares of Series J Preferred Stock at a stated value of $ 1,000 per share, initially convertible into 682,023 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $ 15.40 , for aggregate gross proceeds of $ 6,000,000 , which was used for working capital and general corporate purposes. Pursuant to a registration rights agreement entered into in connection with the securities purchase agreements on September 4, 2020, the Company agreed to register the shares issuable upon conversion of the Series J Preferred Stock for resale by the investors. The Company committed to file the registration statement by no later than the 30th calendar day following the date the Company files its (a) Annual Reports on Form 10-K for the fiscal year ended December 31, 2018 and December 31, 2019, (b) all its required Quarterly Reports on Form 10-Q since the quarter ended September 30, 2018, through the quarter ended September 30, 2020, and (c) any Form 8-K Reports that the Company is required to file with the SEC; but in no event later than April 30, 2021 (the “Filing Date”). The Company also committed to cause the registration statement to become effective by no later than 60 days after the Filing Date (or, in the event of a full review by the staff of the SEC, 120 days following the Filing Date) and upon the occurrence of certain events up to a maximum amount of 6 % of the aggregate amount invested. The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). F- 48 The number of shares issuable upon conversion of the Series J Preferred Stock will be adjusted in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each share of Series J Convertible Preferred Stock votes on an as-if-converted to common stock basis, subject to certain conditions. The securities purchase agreements included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement after 6 months of the closing date, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. The securities purchase agreements provide for Public Information Failure Damages (further details are provided in Note 15). The following table represents the components of the Series J Preferred Stock for the years ended and as of December 31, 2020: Schedule of Components of Preferred Stock Series J Preferred Shares Stock Components Issuance of Series J Preferred Stock at January 1, 2020 20,000 $ 20,000,000 Less costs recognized upon issuance: Issuance costs incurred upon issuance ( 580,004 ) Liquidated Damages recognized upon issuance ( 1,680,000 ) Total issuance costs and Liquidated Damages ( 2,260,004 ) Net issuance of Series J Preferred Stock at January 1, 2020 17,739,996 Issuance of Series J Preferred Stock on September 4, 2020 10,500 6,000,000 Net Issuance of Series J Preferred Stock prior to conversion on December 18, 2020 30,500 23,739,996 Conversion of Series J Preferred Stock into common stock on December 18, 2020 (as further described below) ( 30,500 ) ( 23,739,996 ) Series I Preferred Stock at December 31, 2020 - $ - All the shares of Series J Preferred Stock converted automatically into shares of the Company’s common stock on December 18, 2020, as a result of the increase in the number of authorized shares of the Company’s common stock (as further described in Note 21). Upon conversion the Company recognized a beneficial conversion feature of $ 586,545 for the underlying common shares since the nondetachable conversion feature was in-the-money (the effective conversion price of $ 8.80 for the issuance of Series J Preferred Stock on September 4, 2020 (these shares were issued at a discount) was lower than the Company’s common stock trading price of $ 13.42 at the conversion date). The beneficial conversion feature was recognized as a deemed dividend with an offset to additional paid-in capital. The Company recorded the issuance of shares of the Company’s common stock upon conversion of the Series J Preferred Stock of 1,981,114 during the year ended December 31, 2020 on the consolidated statements of stockholders’ deficiency. Series K Preferred Stock Between October 23, 2020 and November 11, 2020, the Company closed on several securities purchase agreements with accredited investors, pursuant to which the Company issued an aggregate of 18,042 shares of Series K Convertible Preferred Stock” (the “Series K Preferred Stock”) at a stated value of $ 1,000 , initially convertible into 2,050,228 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $ 8.80 per share, for aggregate gross proceeds of $ 18,042,000 . The number of shares issuable upon conversion of the Series K Preferred Stock will be adjusted in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each Series K Preferred Stock votes on an as-if-converted to common stock basis, subject to certain conditions. In consideration for its services as placement agent, the Company paid B. Riley FBR a cash fee of $ 560,500 . The Company used approximately $ 3.4 million of the net proceeds from the financing to partially repay the Delayed Draw Term Note and used approximately $ 2.6 million for payment on a prior investment, with the remainder of approximately $ 11.5 million for working capital and general corporate purposes. F- 49 Pursuant to a registration rights agreement entered into in connection with the securities purchase agreements, the Company agreed to register the shares issuable upon conversion of the Series K Preferred Stock for resale by the investors. The Company committed to file the registration statement by no later than the 30th calendar day following the date the Company files its (a) Annual Reports on Form 10-K for the fiscal year ended December 31, 2018 and December 31, 2019, (b) all its required Quarterly Reports on Form 10-Q since the quarter ended September 30, 2018, through the quarter ended September 30, 2020, and (c) any Form 8-K Reports that the Company is required to file with the SEC; provided, however, if such 30th calendar day is on or after February 12, 2021, then such 30th calendar date shall be tolled until the 30th calendar day following the date that the Company files its Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the “Filing Date”). The Company also committed to cause the registration statement to become effective by no later than 90 days after the Filing Date (or, in the event of a full review by the staff of the SEC, 120 days following the Filing Date) and upon the occurrence of certain events up to a maximum amount of 6 % of the aggregate amount invested. The registration rights agreements provide for Registration Rights Damages (further details are provided in Note 15). The securities purchase agreements included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement after 6 months of the closing date, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. The securities purchase agreements provide for Public Information Failure Damages (further details are provided in Note 15). The following table represents the components of the Series K Preferred Stock as of and for the year ended December 31, 2020: Schedule of Components of Preferred Stock Series K Preferred Shares Stock Components Issuance of Series K Preferred Stock: Issuance of Series K Preferred Stock on October 23, 2020 6,750 $ 6,750,000 Issuance of Series K Preferred Stock on October 28, 2020 5,292 5,292,000 Issuance of Series K Preferred Stock on November 11, 2020 6,000 6,000,000 Total issuance of Series K Preferred Stock 18,042 18,042,000 Less issuance costs: Cash paid to B. Riley FBR as placement fee ( 440,500 ) Legal fees and other costs ( 120,000 ) Total issuance costs ( 560,500 ) Net issuance of Series K Preferred Stock prior to conversion on December 18, 2020 18,042 17,481,500 Conversion of Series K Preferred Stock to common stock on December 18, 2020 (as further described below) ( 18,042 ) ( 17,481,500 ) Series K Preferred Stock at December 31, 2020 - $ - All the shares of Series K Preferred Stock converted automatically into shares of the Company’s common stock on December 18, 2020, as a result of the increase in the number of authorized shares of the Company’s common stock (as further described in Note 21). Upon conversion the Company recognized a beneficial conversion feature of $ 9,472,050 for the underlying common shares since the nondetachable conversion feature was in-the-money (the conversion price of $ 8.80 was lower than the Company’s common stock trading price of $ 13.42 at the conversion date). The beneficial conversion feature was recognized as a deemed dividend with an offset to additional paid-in capital. The Company recorded the issuance of shares of the Company’s common stock upon conversion of the Series K Preferred Stock of 2,050,228 during the year ended December 31, 2020 on the consolidated statements of stockholders’ deficiency. F- 50 Series L Preferred Stock On May 4, 2021, a special committee of the Board declared a dividend of one preferred stock purchase right to be paid to the stockholders of record at the close of business on May 14, 2021 for (i) each outstanding share of the Company’s common stock and (ii) each share of the Company’s common stock issuable upon conversion of each share of the Company’s Series H Preferred Stock. Each preferred stock purchase right entitles the registered holder to purchase, subject to a rights agreement, from the Company one one-thousandth of a share of the Company’s newly created Series L Junior Participating Preferred Stock, par value $ 0.01 per share (the “Series L Preferred Stock”), at a price of $ 4.00 , subject to certain adjustments. The Series L Preferred Stock will be entitled, when, as and if declared, to a preferential per share quarterly dividend payment equal to the greater of (i) $1.00 per share or (ii) 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions paid to the holders of the Company’s common stock. The Series L Preferred Stock will be entitled to 1,000 votes on all matters submitted to a vote of the stockholders of the Company. In the event of any merger, consolidation or other transaction in which shares of the Company’s common stock are converted or exchanged, the Series L Preferred Stock will be entitled to receive 1,000 times the amount received per one share of the Company’s common stock (further details are provided under the heading Series L Preferred Stock in Note 28). 21. Stockholders’ Deficiency Common Stock The Company has the authority to issue 1,000,000,000 shares of common stock, $ 0.01 par value per share as the result of filing on December 18, 2020, a Certificate of Amendment with the Secretary of the State of Delaware to increase the number of authorized shares of its common stock from 100,000,000 shares to 1,000,000,000 shares. Common Stock Private Placement Private Placement – On May 20, 2021 and May 25, 2021, the Company entered into securities purchase agreements with several accredited investors, pursuant to which the Company sold an aggregate of 974,351 shares of its common stock, at a per share price of $ 15.40 for aggregate gross proceeds of $ 15,005,000 in a private placement. On June 2, 2021, the Company entered into a securities purchase agreement with an accredited investor, pursuant to which the Company sold an aggregate of 324,676 shares of its common stock, at a per share price of $ 15.40 for gross proceeds of $ 5,000,000 in a private placement that was in addition to the closings that occurred on May 20, 2021 and May 25, 2021. After payment of legal fees and expenses the investors of $ 167,243 , of which $ 100,000 was paid in cash to B. Riley, the Company received net proceeds of $ 19,837,757 . The Company used the proceeds for general corporate purposes. Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements, the Company agreed to register the shares of the Company’s common stock issued in the private placements. The Company registered those shares of the Company’s common stock issued in the private placements on behalf of the selling stockholders that notified the Company that they wanted to have their shares registered by filing a registration statement, which was declared effective by the SEC on November 29, 2021. F- 51 The security purchase agreements included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement at any time during the period commencing from the twelve (12) month anniversary of the date the Company becomes current in its filing obligations and ending at such time that all of the common stock may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public information requirement under Rule 144(c) or (ii) has ever been an issuer described in Rule 144(i)(1)(i) or becomes an issuer in the future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) (a “Public Information Failure”) then, in addition to such purchaser’s other available remedies, the Company shall pay to a purchaser, in cash, as partial liquidated damages and not as a penalty, an amount in cash equal to one percent (1.0%) of the aggregate subscription amount of the purchaser’s shares then held by the purchaser on the day of a Public Information Failure and on every thirtieth (30th) day (pro-rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured up to a maximum of five (5) 30-day periods and (b) such time that such public information is no longer required for the purchasers to transfer the shares pursuant to Rule 144. Public Information Failure Damages shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure Damages are incurred and (ii) the third (3rd) business day after the event or failure giving rise to the Public Information Failure Damages is cured. In the event the Company fails to make Public Information Failure Damages in a timely manner, such Public Information Failure Damages shall bear interest at the rate of 1.0% per month (prorated for partial months) until paid in full. LiftIgniter – In connection with the asset acquisition of LiftIgniter, the Company issued 11,667 shares of the Company’s common stock pursuant to the restricted stock units granted at the acquisition date. Professional Services – In connection with entering into a services agreement, the Company issued 14,205 shares of the Company’s common stock that were recorded at the trading price of the Company’s at the issuance date of $ 8.80 on January 21, 2021. Common Stock to be Issued In connection with the merger of Say Media on December 12, 2018, the Company issued 129,880 shares of the Company’s common stock during the year ended December 31, 2020 out of the total shares required to be issued of 230,326 . As of December 31, 2021 and 2020, 46,406 shares of the Company’s common stock have not been issued and are to be issued. In connection with a closing of a private placement on January 4, 2018, MDB, as the placement agent, was entitled to receive 2,728 shares of the Company’s common stock that have not been issued as of December 31, 2021 and 2020. Further, the 2,728 shares of common stock to be issued were subject to Liquidated Damages (see Note 15). Restricted Stock Awards On January 1, 2020, the Company issued 25,569 shares of its common stock as restricted stock awards to certain members of the Board subject to continued service with the Company. The awards vest over a twelve-month period from the grant date and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award (see Note 22). F- 52 On December 31, 2020, the Company modified certain restricted stock awards and units, which were previously issued to certain employees in connection with the HubPages merger, where the Company agreed to repurchase the underlying common stock of the restricted stock awards at a specified price and forfeited any unvested awards. Pursuant to certain terms of the amendment, the Company agreed to repurchase 48,389 shares of the Company’s stock that were issued as restricted stock awards and forfeited the restricted stock units (as further described in Note 12). The terms under which the restricted stock awards and units were granted are summarized as follows: ● The Company issued a total of 109,091 shares of common stock to certain key personnel of HubPages who agreed to continue their employment, as restricted stock awards, subject to a repurchase right and vesting in connection with the merger that were fair valued upon issuance by an independent appraisal firm; ● The repurchase right, which expired in March 2019 unexercised, gave the Company the option to repurchase a certain number of shares at par value based on a performance condition as defined in the terms of the merger agreement; ● The shares were subject to vesting over twenty-four equal monthly installments beginning September 23, 2019, and ending September 23, 2021; ● The restricted stock awards provided for a true-up period (in general, the true-up period was for 13 months after the consummation of the merger until 90 days following completion of vesting, or July 30, 2021) that if the common stock was sold for less than $2.50 the holder would receive, subject to certain conditions, additional shares of common stock (i.e. the restricted stock units) up to a maximum of the number of shares originally received (or 109,091 in aggregate to all holders) for the shares that re-sold for less than $2.50, which was settled on May 31, 2019 (as further described in Note 22) ; During the year ended December 31, 2021, the Company issued an aggregate of 48,856 shares of its common stock as restricted stock awards to certain members of the Board subject to continued service with the Company. The awards generally vest over a twelve-month period (or shorter if granted after January 1, 2021 so that the awards are fully vested as of December 31, 2021) from the grant date and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award (see Note 22). On June 4, 2021, in connection with the merger of The Spun, the Company issued an aggregate of 194,806 restricted stock awards of the Company’s common stock, with one-half of the shares vesting on the first anniversary of the closing date and the remaining one-half of the shares vesting on the second anniversary of the closing date. The vesting of the restricted stock awards are subject to the continued employment of certain selling employees and the estimated fair value of these awards are being recognized as compensation expense over the vesting period of the award (see Note 22). Unless otherwise stated, the fair value of a restricted stock award is determined based on the number of shares granted and the quoted price of the Company’s common stock on the date issued. F- 53 A summary of the restricted stock award activity during the years ended December 31, 2021 and 2020 is as follows: Summary of Restricted Stock Award Activity Weighted Average Number of Shares Grant-Date Unvested Vested Fair Value Restricted stock awards outstanding at January 1, 2020 108,713 77,077 $ 12.32 Issued 25,569 - 10.56 Vested ( 101,706 ) 101,706 Subject to repurchase - ( 48,389 ) Forfeited ( 18,182 ) ( 33,947 ) Restricted stock awards outstanding at December 31, 2020 14,394 96,447 9.24 Issued 243,662 - 16.15 Vested ( 56,415 ) 56,415 Exchange of shares - ( 4,035 ) Forfeited ( 6,835 ) ( 4,355 ) Restricted stock awards outstanding at December 31, 2021 194,806 144,472 14.93 The Company permitted an exchange of 4,035 shares from vested restricted stock awards for the exercise of 7,893 common stock options (issued under the 2019 Plan, see Note 22) for the recorded net exercise of common stock options of 3,858 shares during the year ended December 31, 2021, on the consolidated statements of stockholders’ deficiency. The Company recorded forfeited unvested restricted stock awards and/or forfeited vested restricted stock awards used for tax withholding of 11,190 ( 6,835 forfeited awards and 4,355 used for tax withholding) and 52,129 ( 18,182 forfeited awards and 33,947 used for tax withholding) during the years ended December 31, 2021 and 2020, respectively, on the consolidated statements of stockholders’ deficiency. On October 7, 2021, the Company modified certain restricted stock awards upon the resignation of certain board members from the Board as follows: ● 18,940 restricted stock awards that were issued to certain members of the Board were modified to accelerate the vesting upon resignation from the Board, resulting in incremental cost of $ 41,667 (recognized at the modification date). On December 11, 2019, the Company modified the vesting provisions of 90,910 restricted stock awards, issued in connection with the Say Media merger, to remove certain repurchase rights, such that they will vest six equal installments at four-month intervals on the twelfth of each month, starting on December 12, 2019, with the final vesting date on August 12, 2021. Compensation expense was recognized over the vesting period of the awards. Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the restricted stock awards is provided under the heading Stock-Based Compensation in Note 22. Common Stock Warrants Warrants issued to purchase shares of the Company’s common stock to MDB, L2, Strome, and B. Riley (collectively the “Financing Warrants”) are described below. MDB Warrants – On October 19, 2017, the Company issued warrants to MDB (the “MDB Warrants”) who acted as placement agent in connection with a private placement of its common stock, to purchase 5,435 shares of common stock. The warrants have an exercise price of $ 25.30 per share, subject to customary anti-dilution adjustments and exercisable for a period of five years . F- 54 On January 4, 2018, the Company issued warrants to MDB which acted as placement agent in connection with a private placement of its common stock, to purchase 2,728 shares of common stock. The warrants have an exercise price of $ 55.00 per share, subject to customary anti-dilution adjustments, and may, in the event there is no effective registration statement covering the re-sale of the warrant shares, be exercised on a cashless basis, exercisable for a period of five years. MDB Warrants exercisable for a total of 8,163 shares of the Company’s common stock were outstanding as of December 31, 2021 (as further detailed below). Strome Warrants – On June 15, 2018, the Company modified the two securities purchase agreements dated January 4, 2018 and March 30, 2018 with Strome Mezzanine Fund LP (“Strome”). As consideration for such modification, the Company issued warrants to Strome (the “Strome Warrants”) to purchase 68,182 shares of common stock, exercisable at price of $ 11.00 per share (as amended), which were carried on the consolidated balance sheets as a derivative liability at fair value, as adjusted at each period-end since, among other criteria, delivery of unregistered shares was precluded upon exercise (see Note 17). The Strome Warrants are exercisable for a period of five years, subject to customary anti-dilution adjustments, and may, in the event there is no effective registration statement covering the resale of the warrant shares, be exercised on a cashless basis in certain circumstances. B. Riley Warrants – On October 18, 2018, the Company issued warrants to B. Riley (the “B. Riley Warrants”) to purchase up to 39,773 shares of the Company’s common stock, with an original exercise price of $ 22.00 per share (subsequently adjusted to $ 7.26 ), subject to customary anti-dilution adjustments, which were carried on the consolidated balance sheets as a derivative liability at fair value, as adjusted at each period-end since, among other criteria, delivery of unregistered shares was precluded upon exercise (see Note 17). The B. Riley Warrants are exercisable for a period of five years, subject to customary anti-dilution adjustments, and may, in the event, at any time after the six-month anniversary of the issuance of the warrants, if there is no effective registration statement covering the re-sale of the shares of common stock underlying the warrants, the warrants may be exercised on a cashless basis. A summary of the Financing Warrants activity during the years ended December 31, 2021 and 2020 is as follows: Summary of Warrant Activity Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Financing Warrants outstanding at January 1, 2020 131,004 $ 17.60 3.95 Financing Warrants outstanding at December 31, 2020 131,004 13.20 2.94 Expired ( 14,886 ) 4.40 Financing Warrants outstanding at December 31, 2021 116,118 14.08 2.21 Financing Warrants exercisable at December 31, 2021 116,118 14.08 2.21 The intrinsic value of exercisable but unexercised in-the-money Financing Warrants as of December 31, 2021 was $ 481,253 , based on a fair market value of the Company’s common stock of $ 14.08 per share on December 31, 2021. F- 55 The Financing Warrants outstanding and exercisable classified within the statement of stockholders’ deficiency as of December 31, 2021 are summarized as follows: Schedule of Common Stock Financing Warrants Outstanding and Exercisable Exercise Price Expiration Date Total Exercisable (Shares) Strome Warrants $ 11.00 June 15, 2023 68,182 B. Riley Warrants 7.26 October 18, 2025 39,773 MDB Warrants 25.30 October 19, 2022 5,435 MDB Warrants 55.00 October 19, 2022 2,728 Total outstanding and exercisable 116,118 AllHipHop Warrants – On October 26, 2020, the Company exchanged 6,819 of Publisher Partner Warrants (as further described under the heading Publisher Partner Warrants ) granted to AllHipHop, LLC (“AllHipHop”) for shares of the Company’s common stock that were originally granted on December 20, 2017 with an exercise price of $ 45.76 , for an aggregate of 5,681 new warrants for shares of the Company’s common stock with an exercise price of $ 14.30 (the “AllHipHop Warrants”) for the surrender and termination of the original warrants granted (the “Exchange”) (further details are provided in Note 22). The AllHipHop Warrants are exercisable for a period of five years, subject to customary anti-dilution adjustments, and may be exercised on a cashless basis. Publisher Partner Warrants – On December 19, 2016, the Board approved up to 227,273 stock warrants to issue shares of the Company’s common stock to provide equity incentive to its Publisher Partners (the “Publisher Partner Warrants”) to motivate and reward them for their services to the Company and to align the interests of the Publisher Partners with those of stockholders of the Company. On August 23, 2018, the Board approved a reduction of the number of warrant reserve shares from 227,273 to 90,910 . The issuance of the Publisher Partner Warrants is administered by management and approved by the Board. Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the Publisher Partner Warrants is provided in Note 22. ABG Warrants – On June 14, 2019, the Company issued 999,540 warrants to acquire the Company’s common stock to ABG in connection with the Sports Illustrated Licensing Agreement, expiring in ten years . Half the warrants have an exercise price of $ 9.24 per share (the “$9.24 Warrants”). The other half of the warrants have an exercise price of $ 18.48 per share (the “$18.48 Warrants”). The warrants provide for the following: ( 1) 40% of the $9.24 Warrants and 40% of the $18.48 Warrants vest in equal monthly increments over a period of two years beginning on the one year anniversary of the date of issuance of the warrants (any unvested portion of such warrants to be forfeited by ABG upon certain terminations by the Company of the Sports Illustrated Licensing Agreement) (the “Time-Based Warrants”); (2) 60% of the $9.24 Warrants and 60% of the $18.48 Warrants vest based on the achievement of certain performance goals for the licensed brands in calendar years 2020, 2021, 2022, or 2023; (3) under certain circumstances the Company may require ABG to exercise all (and not less than all) of the warrants, in which case all of the warrants will be vested; (4) all of the warrants automatically vest upon certain terminations of the Licensing Agreement by ABG or upon a change of control of the Company (the “Performance-Based Warrants”); and (5) ABG has the right to participate, on a pro-rata basis (including vested and unvested warrants, exercised or unexercised), in any future equity issuance of the Company (subject to customary exceptions). F- 56 On June 4, 2021, the Company amended certain ABG Warrants in exchange for additional benefits under the Sports Illustrated licensing agreement as follows: ● The exercise price of 99,954 Time-Based Warrants (50% of the original warrants granted totaling 199,908 ) were adjusted from $ 18.48 to $ 7.26 per share as adjusted for any stock splits, combinations, stock dividends, reclassifications, recapitalizations and other similar events, resulting in incremental cost of $ 417,807 (to be recognized over the remaining vesting period, or through June 14, 2022) measured by an independent appraisal by calculating the fair value of the amended warrant over the calculated fair value of the original warrant immediately before the modification, with the excess fair value of the amended warrant recognized as additional compensation cost at the modification date, or the incremental cost, since the modification did not change the expectation that the award would ultimately vest (probable-to-probable). ● The exercise price of 149,931 Performance-Based Warrants (50% of the original warrants granted totaling 299,862 ) were adjusted from $ 18.48 to $ 9.24 per share as adjusted for any stock splits, combinations, stock dividends, reclassifications, recapitalizations and other similar events, resulting in incremental cost of $ 618,465 (to be recognized over the remaining vesting period, or through December 31, 2023) measured by an independent appraisal by calculating the fair value of the amended warrant over the calculated fair value of the original warrant immediately before the modification, with the excess fair value of the amended warrant recognized as additional compensation cost at the modification date, or the incremental cost, since the modification did not change the expectation that the award would ultimately vest (probable-to-probable). Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the ABG Warrants is provided in Note 22. 22. Stock–Based Compensation Common Stock Awards 2016 Plan – On December 19, 2016, the Board adopted the 2016 Stock Incentive Plan (the “2016 Plan”). The purpose of the 2016 Plan is to advance the interests of the Company and its stockholders by enabling the Company and its subsidiaries to attract and retain qualified individuals through opportunities for equity participation in the Company, and to reward those individuals who contribute to the Company’s achievement of its economic objectives. The 2016 Plan allows the Company to grant statutory and non-statutory common stock options, and restricted stock awards (collectively the “common stock awards”) to acquire shares of the Company’s common stock to the Company’s employees, directors and consultants. Shares subject to an award that lapse, expire, are forfeited or for any reason are terminated unexercised or unvested will automatically again become available for issuance under the 2016 Plan. Stock awards issued under the 2016 Plan may have a term of up to ten years and may have variable vesting provisions consisting of time-based and performance-based. On March 28, 2018, the Board approved an increase in the number of shares of the Company’s common stock reserved for grant pursuant to the 2016 Plan from 136,363 shares to 227,272 shares. On August 23, 2018, the Board increased the authorized number of shares of common stock under the 2016 Plan from 227,272 shares to 454,545 shares. The Company’s stockholders approved the increase in the number of shares authorized under the 2016 Plan on April 3, 2020. The issuance of common stock awards under the 2016 Plan is administered by the Company and approved by the Board. The estimated fair value of the common stock awards is recognized as compensation expense over the vesting period of the award. The fair value of common stock awards granted during the year ended December 31, 2020 were calculated using the Black-Scholes option pricing model under the Probability Weighted Scenarios utilizing the following assumptions: Schedule of Fair Value of Stock Options Assumptions Up-list No Up-list Risk-free interest rate 0.45 % 0.45 % Expected dividend yield 0.00 % 0.00 % Expected volatility 71.00 % 132.00 % Expected life 6.0 years 6.0 years F- 57 A summary of the common stock award activity during the years ended December 31, 2021 and 2020 is as follows: Summary of Stock Option Activity Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Common stock awards outstanding at January 1, 2020 366,571 $ 13.64 8.34 Granted 10,637 19.80 Exercised ( 316 ) 12.32 Forfeited ( 27,327 ) 23.98 Expired ( 35,823 ) 11.66 Common stock awards outstanding at December 31, 2020 313,742 18.92 7.50 Granted 8,041 27.42 Forfeited ( 176 ) 12.32 Expired ( 28,266 ) 26.84 Common stock awards outstanding at December 31, 2021 293,341 18.49 6.49 Common stock awards exercisable at December 31, 2021 293,341 18.49 6.49 Common stock awards not vested at December 31, 2021 - Common stock awards available for future grants at December 31, 2021 161,204 The aggregate grant date fair value of common stock awards granted during the years ended December 31, 2021 was $ 173,934 . On January 8, 2021, the Company modified certain common stock awards as follows: ● 10,000 common stock option grants that were subject to performance-vesting (revenue targets) were modified to remove the performance-vesting conditions and fully vest the award at the modification date with no further service requirement, resulting in incremental cost of $ 35,352 (recognized at the modification date). ● 9,091 common stock option grants were that were subject to performance-vesting (publishing onboarding targets) were modified to remove the performance-vesting conditions and fully vest the award at the modification date with no further service requirement, resulting in no incremental cost. On June 3, 2021, the Company modified certain common stock awards in connection with a consulting agreement entered into on August 26, 2020, as amended on June 3, 2021, which extended to consulting term through August 26, 2022 (the “Amended Consulting Agreement”), as follows: ● 102,272 common stock option grants that were time-vesting were modified to permit the common stock options to be exercisable for their full term, or 10-years, resulting in no incremental cost. On October 7, 2021, the Company modified certain common stock awards upon the resignation of certain board members from the Board as follows: ● 7,160 common stock option grants that were fully vested and subject time-vesting were modified to permit an extension of the exercise period for 2-years, or through October 7, 2023, resulting in no incremental cost. F- 58 The intrinsic value of exercisable but unexercised in-the-money common stock awards as of December 31, 2021 was $ 384,720 based on a fair market value of the Company’s common stock of $ 14.08 per share on December 31, 2021. The exercise prices under the 2016 Plan for the common stock awards outstanding and exercisable are as follows as of December 31, 2021: Schedule of Exercise Prices of Common Stock Options Exercise Outstanding Exercisable Price (Shares) (Shares) Under $ 11.00 32,591 32,591 $ 11.01 to $ 16.50 171,797 171,797 $ 16.51 to $ 22.00 - - $ 22.01 to $ 27.50 41,486 41,486 $ 27.51 to $ 33.00 910 910 $ 33.01 to $ 38.50 11,366 11,366 $ 38.51 to $ 44.00 34,509 34,509 $ 44.01 to $ 49.50 682 682 293,341 293,341 Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the common stock awards is provided under the heading Stock-Based Compensation . Common Equity Awards 2019 Plan – On April 4, 2019, the Board adopted the 2019 Equity Incentive Plan (the “2019 Plan”). The purpose of the 2019 Plan is to retain the services of our directors, employees, and consultants and align the interests of these individuals with the interests of our stockholders through awards of stock options, restricted stock awards, restricted stock units, unrestricted stock awards, and stock appreciation rights (collectively the “common equity awards”). Certain common equity awards require the achievement of certain price targets of the Company’s common stock. Shares subject to a common equity award that lapse, expire, are forfeited or for any reason are terminated unexercised or unvested will automatically again become available for issuance under the 2019 Plan. Common stock options issued under the 2019 Plan may have a term of up to ten years and may have variable vesting provisions consisting of time-based, performance-based, or market-based. The Company’s stockholders approved the 2019 Plan and the maximum number of shares authorized of 3,863,636 under the 2019 Plan on April 3, 2020. On February 18, 2021, the Board increased the authorized number of shares of common stock under the 2019 Plan from 3,863,637 shares to 8,409,090 shares. The issuance of common equity awards under the 2019 Plan is administered by the Company and approved by the Board. Prior to December 18, 2020, the Company did not have sufficient authorized but unissued shares of common stock to allow for the exercise of these common equity awards granted; accordingly, any common equity awards granted were considered unfunded and were not exercisable until sufficient common shares were authorized (further details are provided in Note 21). During the years ended December 31, 2021 and 2020, the Company issued restricted stock units of shares of the Company’s common stock of 1,677,680 and 147,728 , respectively, to senior management under the 2019 Plan, subject to vesting and other terms and conditions. The estimated fair value of the common equity awards is recognized as compensation expense over the vesting period of the award. Unless otherwise stated, the fair value of a restricted stock unit is determined based on the number of shares granted and the quoted price of the Company’s common stock on the date issued. F- 59 The fair value of common equity awards granted during the years ended December 31, 2021 and 2020 were calculated using the Black-Scholes option pricing model for the time-based and performance-based awards by an independent appraisal firm under the Probability Weighted Scenarios utilizing the following assumptions: Schedule of Fair Value of Stock Options Assumptions Year Ended December 31, 2021 Year Ended December 31, 2020 Up-list No Up-list Up-list No Up-list Risk-free interest rate 0.16 % - 1.48 % 0.16 % - 1.48 % 0.20 % - 0.79 % 0.20 % - 0.79 % Expected dividend yield 0.00 % 0.00 % 0.00 % 0.00 % Expected volatility 65.00 % - 90.00 % 133.00 % - 140.00 % 61.00 % - 91.00 % 61.00 % - 142.00 % Expected life 3.0 – 6.0 years 3.0 – 6.0 years 3.0 – 6.7 years 3.0 – 6.7 years A summary of the common equity award activity during the years ended December 31, 2021 and 2020 is as follows: Summary of Stock Option Activity Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Common equity awards outstanding at January 1, 2020 2,955,166 $ 11.66 9.43 Granted 1,154,263 15.62 Forfeited ( 379,199 ) 13.42 Expired ( 124 ) 12.32 Common equity awards outstanding at December 31, 2020 3,730,106 12.76 8.65 Granted 3,981,907 10.86 Exercised ( 7,893 ) 10.12 Issued ( 22,728 ) - Forfeited ( 433,982 ) 16.01 Expired ( 339,956 ) 12.02 Common equity awards outstanding at December 31, 2021 (1) 6,907,454 11.23 8.63 Common equity awards exercisable at December 31, 2021 2,052,532 12.04 8.16 Common equity awards not vested at December 31, 2021 (1) 4,854,922 Common equity awards available for future grants at December 31, 2021 (2) 1,408,443 (1) Includes 1,814,044 restricted stock units outstanding (2) Excludes 70,465 restricted stock awards vested as of December 31, 2021 that were issued under the 2019 Plan The aggregate grant date fair value for the common equity awards granted during the years ended December 31, 2021 and 2020 was $ 58,093,478 and $ 11,180,642 , respectively. On January 8, 2021, the Company modified certain common equity awards as follows: ● 475,946 common stock option grants that were issued to senior management were subject to market-based vesting (stock price targets) with a time-vesting overlay were modified to remove the market-based conditions with only the time-vesting condition remaining after the modification, resulting in incremental cost of $ 125,650 (to be recognized over the remaining time-vesting period of the original award at the modification date). F- 60 ● 194,319 common stock option grants that were issued to senior management were subject to performance-vesting (revenue targets) were modified to remove the performance-vesting conditions and replace the time-vesting condition such that the common stock options will vest with respect to one-third of the grant when the option holder completes one year of continuous service beginning on the grant date and the remaining common stock options will vest monthly over twenty-four months when the option holder completes each month of continuous service thereafter, resulting in no incremental cost. ● 572,674 common stock option grants that were subject to market-based vesting (stock price targets) with a time-vesting overlay were modified, in general, to remove the market-based condition and replace the time-vesting condition such that the common stock options will vest with respect to one-third of the grant when the option holder completes one year of continuous service beginning on the grant date and the remaining common stock options will vest monthly over twenty-four months when the option holder completes each month of continuous service thereafter, resulting in incremental cost of $ 13,893 (to be recognized over the remaining time-vesting period of the original award at the modification date). On June 3, 2021, the Company modified certain common equity awards in connection with the Amended Consulting Agreement as follows: ● 659,511 common stock option grants that were subject to performance-vesting conditions (stock-price targets) were modified such that: (1) 90,910 common stock option awards were vested at the modification date, resulting in incremental cost of $ 51,293 (recognized at the modification date); and (2) 568,601 common stock option awards would vest, subject to the Company’s common stock being listing on a national securities exchange, upon market-based conditions (stock price targets), resulting in incremental cost of $ 512,883 (to be recognized over the implied service period, or through August 26, 2022, at the modification date) measured by an independent appraisal, subject to certain volume weighted average price provisions and permitting the common stock options to be exercisable for their full term, or 10-years, as follows: Summary of Common Stock Options Exercisable Stock Number of Shares Price that Vest $ 14.30 114,035 $ 22.00 151,522 $ 33.00 151,522 $ 44.00 151,522 568,601 On October 7, 2021, the Company modified certain common equity awards upon the resignation of certain board members from the Board as follows: ● 65,951 common stock options grants that were subject to market-based vesting (stock price targets) with a time-vesting overlay were modified to remove the market-based conditions and to accelerate the vesting upon resignation from the Board with an extension of the exercise period for 2-years, or through October 7, 2023, resulting in incremental cost of $ 267,912 (recognized at the modification date). F- 61 The intrinsic value of exercisable (or issuable in the case of vested restricted stock units) but unexercised (or unissued in the case of restricted stock units) in-the-money common equity awards as of December 31, 2021 was $ 6,572,579 based on a fair market value of the Company’s common stock of $ 14.08 per share on December 31, 2021. The exercise prices under the 2019 Plan for the common equity awards outstanding and exercisable are as follows as of December 31, 2021: Summary of Common Stock Options Exercisable Exercise Outstanding Exercisable Price (Shares) (Shares) No exercise price 1,802,686 166,574 $ 7.00 to $ 9.99 132,281 83,496 $ 10.00 to $ 12.99 1,802,249 974,941 $ 13.00 to $ 15.99 334,825 135,689 $ 16.00 to $ 18.99 1,803,385 664,881 $ 19.00 to $ 21.99 1,032,028 26,951 6,907,454 2,052,532 Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the common equity awards is provided under the heading Stock-Based Compensation . Outside Options The Company granted stock options outside the 2016 Plan and 2019 Plan to certain officers, directors and employees of the Company as approved by the Board and administered by the Company (the “outside options”). The stock options were to acquire shares of the Company’s common stock and were subject to: (1) time-based vesting; (2) certain performance-based targets; and (3) certain performance achievements. Options to purchase common stock issued as outside options may have a term of up to ten years. The issuance of outside options is administered by the Company and approved by the Board. Prior to December 18, 2020, the Company did not have sufficient authorized but unissued shares of common stock to allow for the exercise of these outside options granted; accordingly, any common stock options granted were considered unfunded and were not exercisable until sufficient common shares were authorized (further details are provided in Note 21). A summary of outside option activity during the years ended December 31, 2021 and 2020 is as follows: Summary of Stock Option Activity Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Outside options outstanding at January 1, 2020 169,304 $ 4.62 9.04 Forfeited ( 8,879 ) 10.12 Expired ( 21,697 ) 8.58 Outside options outstanding at December 31, 2020 138,728 10.12 8.07 Forfeited ( 31 ) 7.70 Expired ( 60 ) 7.70 Outside options outstanding at December 31, 2021 138,637 10.08 7.07 Outside options exercisable at December 31, 2021 132,955 9.98 7.07 Outside options not vested at December 31, 2021 5,682 The intrinsic value of exercisable but unexercised in-the-money outside options as of December 31, 2021 was $ 545,753 based on a fair market value of the Company’s common stock of $ 14.08 per share on December 31, 2021. F- 62 The exercise prices of outside options outstanding and exercisable are as follows as of December 31, 2021: Schedule of Exercise Prices of Common Stock Options Exercise Outstanding Exercisable Price (Shares) (Shares) $ 7.00 to $ 9.99 70,455 70,455 $ 10.00 to $ 12.99 68,182 62,500 138,637 132,955 Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the outside options is provided under the heading Stock-Based Compensation . Publisher Partner Warrants On December 19, 2016, as amended on August 23, 2017, and August 23, 2018, the Board approved the Channel Partner Warrant Program to be administered by management that authorized the Company to grant Publisher Partner Warrants. As of December 31, 2021, Publisher Partner Warrants to purchase up to 90,909 shares of the Company’s common stock were reserved for grant. The Publisher Partner Warrants had certain performance conditions. Pursuant to the terms of the Publisher Partner Warrants, the Company would notify the respective Publisher Partner of the number of shares earned, with one-third of the earned shares vesting on the notice date, one-third of the earned shares vesting on the first anniversary of the notice date, and the remaining one-third of the earned shares vesting on the second anniversary of the notice date. The Publisher Partner Warrants had a term of five years from issuance and could also be exercised on a cashless basis. Performance conditions are generally based on the average of number of unique visitors on the channel operation by the Publisher Partner generated during the six-month period from the launch of the Publisher Partner’s operations on the Company’s technology platform or the revenue generated during the period from the issuance date through a specified end date. A summary of the Publisher Partner Warrants activity during the years ended December 31, 2021 and 2020 is as follows: Schedule of Warrants Activity Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Publisher Partner Warrants outstanding at January 1, 2020 42,707 $ 32.12 2.57 Forfeited ( 6,819 ) Publisher Partner Warrants outstanding at December 31, 2020 35,888 29.48 1.50 Expired ( 281 ) Publisher Partner Warrants outstanding at December 31, 2021 35,607 28.33 0.50 Publisher Partner Warrants exercisable at December 31, 2021 20,766 28.88 0.53 Publisher Partner Warrants not vested at December 31, 2021 14,841 Publisher Partner Warrants available for future grants at December 31, 2021 55,303 On October 26, 2020, the Company recognized incremental compensation costs as a result of the Exchange of $ 27,754 (see Note 21). There was no intrinsic value of exercisable but unexercised in-the-money Publisher Partner Warrants since the fair market value of $ 14.08 per share of the Company’s common stock was lower than the exercise prices on December 31, 2021. F- 63 The exercise prices of the Publisher Partner Warrants outstanding and exercisable are as follows as of December 31, 2021. Schedule of Exercise Prices of Common Stock Options Exercise Outstanding Exercisable Price (Shares) (Shares) $ 20.00 to $ 24.99 6,390 1,844 $ 25.00 to $ 29.99 17,009 12,918 $ 30.00 to $ 34.99 2,521 2,521 $ 35.00 to $ 39.99 4,888 1,138 $ 40.00 to $ 44.99 4,749 2,295 $ 45.00 to $ 49.99 50 50 35,607 20,766 Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the Publisher Partner Warrants is provided under the heading Stock-Based Compensation . Restricted Stock Units On May 31, 2019, the Company issued 109,090 restricted stock units to certain employees in settlement of the true-up provisions of the restricted stock awards issued at the time of the HubPages merger, which was amended on December 15, 2020 where all of the restricted stock units were forfeited on December 31, 2020 (as further described in Note 12). The terms under which the restricted stock units were granted are summarized as follows: ● Each restricted stock unit represented the right to receive a number of the shares of the Company’s common stock pursuant to a grant agreement, subject to certain terms and conditions, and was to be credited to a separate account maintained by the Company in certain circumstances; ● The restricted stock units were to vest six equal installments, subject to the conditions as outlined below, at four-month intervals on the first of each month, starting on June 1, 2019, with the final vesting date on February 1, 2021; ● The restricted stock units would not vest until the Company increased its authorized shares of the Company’s common stock; ● Each restricted stock unit granted and credited to the separate account for the employee was be issued by the Company upon the authorized shares of the Company’s common stock increased (further details are provided in Note 21); and ● Unless otherwise specified in an employee’s grant agreement, vesting would have ceased upon the termination of the employees continuous service. The fair value of a restricted stock unit was determined based on the number of shares granted and the quoted price of the Company’s common stock on the date issued during the year ended December 31, 2020. A summary of the restricted stock unit activity during the years ended December 31, 2021 and 2020 is as follows: Schedule of Restricted Stock Units Activity Weighted Average Number of Shares Grant-Date Unvested Vested Fair Value Restricted stock units outstanding at January 1, 2020 109,091 - $ 9.90 Forfeited ( 109,091 ) - Restricted stock units outstanding at December 31, 2020 - - - Forfeited - - Restricted stock units outstanding at December 31, 2021 - - - Information with respect to stock-based compensation cost related to the restricted stock units is included within the Common Equity Awards caption under the heading Stock-Based Compensation . F- 64 ABG Warrants In connection with the Sports Illustrated Licensing Agreement and issuance of the ABG Warrants to purchase up to 999,540 shares of the Company’s common stock, the Company recorded the issuance of the warrants as stock-based compensation with the fair value of the warrants measured at the time of issuance and expensed over the requisite service period. A summary of the ABG Warrant activity during the years ended December 31, 2021 and 2020 is as follows: Schedule of Warrants Activity Number of Shares Weighted Average Weighted Average Remaining Contractual Life Unvested Vested Exercise Price (in years) ABG Warrants outstanding at January 1, 2020 999,540 - $ 13.86 9.46 Vested ( 99,954 ) 99,954 13.86 ABG Warrants outstanding at December 31, 2020 899,586 99,954 13.86 8.46 Vested ( 199,909 ) 199,909 12.06 ABG Warrants outstanding at December 31, 2021 699,677 299,863 11.55 7.46 The intrinsic value of exercisable but unexercised in-the-money ABG Warrants as of December 31, 2021 was $ 1,007,868 based on a fair market value of the Company’s common stock of $ 14.08 per share on December 31, 2021. The exercise prices of the ABG Warrants outstanding and exercisable are as follows as of December 31, 2021. Schedule of Exercise Prices of Common Stock Options Exercise Outstanding Exercisable Price (Shares) (Shares) $ 9.24 749,655 208,238 $ 18.48 249,885 91,625 999,540 299,863 Information with respect to compensation cost and unrecognized compensation cost related to the ABG Warrants is provided under the heading Stock-Based Compensation . F- 65 Stock-Based Compensation Stock–based compensation and equity-based expense charged to operations or capitalized during the years ended December 31, 2021 and 2020 are summarized as follows: Summary of Stock-based Compensation Year Ended December 31, 2021 Restricted Common Common Publisher Stock Stock Equity Outside Partner ABG Awards Awards Awards Options Warrants Warrants Totals Cost of revenue $ 196,651 $ 303,899 $ 6,974,374 $ 2,981 $ - $ - $ 7,477,905 Selling and marketing - 34,832 5,265,382 75,653 - - 5,375,867 General and administrative 1,535,865 174,123 13,879,175 234,101 - 1,816,485 17,639,749 Total costs charged to operations 1,732,516 512,854 26,118,931 312,735 - 1,816,485 30,493,521 Capitalized platform development 11,128 7,101 2,018,993 8,042 - - 2,045,264 Total stock-based compensation $ 1,743,644 519,955 $ 28,137,924 $ 320,777 $ - $ 1,816,485 $ 32,538,785 Year Ended December 31, 2020 Restricted Common Common Publisher Stock Stock Equity Outside Partner ABG Awards Awards Awards Options Warrants Warrants Totals Cost of revenue $ 163,181 $ 156,043 $ 3,975,625 $ 8,394 $ 36,673 $ - $ 4,339,916 Selling and marketing 1,486,722 114,640 2,454,432 272,431 - - 4,328,225 General and administrative 317,982 615,604 3,439,803 150,577 - 1,449,074 5,973,040 Total costs charged to operations 1,967,885 886,287 9,869,860 431,402 36,673 1,449,074 14,641,181 Capitalized platform development 361,519 178,284 1,062,792 6,400 - - 1,608,995 Total stock-based compensation $ 2,329,404 1,064,571 $ 10,932,652 $ 437,802 $ 36,673 $ 1,449,074 $ 16,250,176 Unrecognized compensation expense related to the stock-based compensation awards and equity-based awards as of December 31, 2021 was as follows: Schedule of Unrecognized Compensation Expense As of December 31, 2021 Restricted Stock Awards Common Stock Awards Common Equity Awards Outside Options Publisher Partner Warrants ABG Warrants Totals Unrecognized compensation expense $ 2,354,832 $ - $ 45,556,247 $ 37,694 $ - $ 2,433,889 $ 50,382,662 Weighted average period expected to be recognized (in years) 1.41 - 1.98 0.19 - 1.67 1.94 F- 66 23. Liquidated Damages The following tables summarize the Liquidated Damages recognized on the consolidated statements of operations during the years ended December 31, 2021 and 2020, with respect to the registration rights agreements and securities purchase agreements: Schedule of Recognized Liquidated Damages Registration Rights Damages Public Information Failure Damages Accrued Interest Balance Years Ended December 31, 2021 Registration Rights Damages Public Information Failure Damages Accrued Interest Balance Series H Preferred Stock $ - $ 7,854 $ 311,348 $ 319,202 12% Convertible Debentures - - 75,461 75,461 Series I Preferred Stock - - 280,692 280,692 Series J Preferred Stock 360,000 360,000 289,775 1,009,775 Series K Preferred Stock 180,420 721,680 50,134 952,234 Total $ 540,420 $ 1,089,534 $ 1,007,410 $ 2,637,364 Registration Rights Damages Public Information Failure Damages Accrued interest Balance Years Ended December 31, 2020 Registration Rights Damages Public Information Failure Damages Accrued interest Balance 12% Convertible Debentures $ - $ 12,300 $ 1,578 $ 13,878 Series I Preferred Stock 277,200 346,500 69,992 693,692 Series J Preferred Stock 360,000 360,000 60,007 780,007 Total $ 637,200 $ 718,800 $ 131,577 $ 1,487,577 24. Income Taxes The components of the benefit (provision) for income taxes consist of the following: Schedule of Income Taxes 2021 2020 Years Ended December 31, 2021 2020 Current tax benefit: Federal $ - $ - State and local - - Total current tax benefit - - Deferred tax (provision) benefit: Federal 18,028,497 20,677,960 State and local 4,439,909 5,279,879 Change in valuation allowance ( 20,793,972 ) ( 26,168,671 ) Total deferred tax (provision) benefit 1,674,434 ( 210,832 ) Total income tax benefit (provision) $ 1,674,434 $ ( 210,832 ) F- 67 The components of deferred tax assets and liabilities were as follows: Schedule of Components of Deferred Tax Assets and Liabilities 2021 2020 As of December 31, 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 41,806,276 $ 35,535,941 Interest limitation carryforward 2,860,899 - Tax credit carryforwards 263,873 263,873 Allowance for doubtful accounts 589,585 458,506 Accrued expenses and other 1,767,649 677,909 Lease termination 1,896,991 - Liquidated damages 2,240,294 1,549,313 Unearned revenue 5,383,337 2,356,111 Stock-based compensation 4,779,191 2,158,080 Operating lease liability 165,065 691,228 Depreciation and amortization 3,029,171 4,341,983 Deferred tax assets 64,782,331 48,032,944 Valuation allowance ( 50,447,389 ) ( 29,653,417 ) Total deferred tax assets 14,334,942 18,379,527 Deferred tax liabilities: Prepaid expenses ( 101,388 ) ( 144,704 ) Acquisition-related intangibles ( 14,595,672 ) ( 18,445,655 ) Total deferred tax liabilities ( 14,697,060 ) ( 18,590,359 ) Net deferred tax liabilities $ ( 362,118 ) $ ( 210,832 ) The Company must make judgements as to the realization of deferred tax assets that are dependent upon a variety of factors, including the generation of future taxable income, the reversal of deferred tax liabilities, and tax planning strategies. To the extent that the Company believes that recovery is not likely, it must establish a valuation allowance. A valuation allowance has been established for deferred tax assets which the Company does not believe meet the “more likely than not” criteria. The Company’s judgments regarding future taxable income may change due to changes in market conditions, changes in tax laws, tax planning strategies or other factors. If the Company’s assumptions and consequently its estimates change in the future, the valuation allowances it has established may be increased or decreased, resulting in a respective increase or decrease in income tax expense. Based upon the Company’s historical operating losses and the uncertainty of future taxable income, the Company has provided a valuation allowance primarily against its deferred tax assets up to the deferred tax liabilities, except for deferred tax liabilities on indefinite lived intangible assets, as of December 31, 2021 and 2020. As of December 31, 2021, the Company had federal, state, and local net operating loss carryforwards available of approximately $ 155.85 million, $ 112.22 million, and $ 37.42 million, respectively, to offset future taxable income. Net operating losses for U.S. federal tax purposes of $ 129.95 million do not expire (limited to 80% of taxable income in a given year) and $ 25.90 million will expire, if not utilized, through 2037 in various amounts . As of December 31, 2020, the Company had federal, state, and local net operating loss carryforwards available of approximately $ 131.17 million, $ 100.61 million, and $ 31.15 million, respectively, to offset future taxable income. Sections 382 and 383 of the Internal Revenue Code imposes restrictions on the use of a corporation’s net operating losses, as well as certain recognized built-in losses and other carryforwards, after an ownership change occurs. A section 382 ownership change occurs if one or more stockholders or groups of stockholders who own at least 5% of the Company’s common stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. Future issuances or sales of the Company’s common stock (including certain transactions involving the Company’s common stock that are outside of the Company’s control) could also result in an ownership change under section 382. If an ownership change occurs, Section 382 would impose an annual limit on the amount of pre-change net operating losses and other losses the Company can use to reduce its taxable income generally equal to the product of the total value of the Company’s outstanding equity immediately prior to the ownership change (subject to certain adjustments) and the long-term tax exempt interest rate for the month of the ownership change. F- 68 The Company believes that it did have a change in control under these sections in connection with its recapitalization on November 4, 2016 and utilization of the carryforwards would be limited such that the majority of the carryforwards will never be available. Accordingly, the Company has not recorded those net operating loss carryforwards and credit carryforwards in its deferred tax assets. The Company completed a preliminary section 382 analysis as of December 31, 2021 and 2020 and concluded it may have experienced an ownership change as a result of certain equity offerings during the rolling three-year period of 2018 to 2020. The Company concluded that its federal net operating loss carryforwards, including any net operating loss carryforwards as a result of the mergers during 2018 and 2019, resulted in annual limitations on the overall net operating loss carryforward and that an ownership change, if any, would impose an annual limit on the net operating loss carryforwards and could cause federal income taxes (similar provisions apply for state and local income taxes) to be paid earlier than otherwise would be paid if such limitations were not in effect. The federal, state, and local net operating loss carryforwards are stated net of any such anticipated limitations as of December 31, 2021 and 2020. The provision (benefit) for income taxes on the statement of operations differs from the amount computed by applying the statutory federal income tax rate to loss before the benefit for income taxes, as follows: Schedule of Tax Benefit and Effective Income Tax Years Ended December 31, 2021 2020 Amount Percent Amount Percent Federal benefit expected at statutory rate $ ( 19,238,957 ) 21.0 % $ ( 18,694,437 ) 21.0 % State and local taxes, net of federal benefit ( 4,439,909 ) 4.8 % ( 5,279,879 ) 5.9 % Stock-based compensation 4,881,640 ( 5.3 )% 1,768,735 ( 2.0 )% Unearned revenue ( 2,703,394 ) 3.0 % ( 5,120,330 ) 5.8 % Interest expense 63,558 ( 0.1 )% 1,173,535 ( 1.3 )% Gain upon debt extinguishment ( 1,200,506 ) 1.3 % - 0.0 % Other differences, net 213,159 ( 0.2 )% 152,294 ( 0.2 )% Valuation allowance 20,793,972 ( 22.7 )% 26,168,671 ( 29.4 )% Other permanent differences ( 43,988 ) 0.0 % 42,243 0.0 % Tax provision (benefit) and effective income tax rate $ ( 1,674,434 ) 1.8 % $ 210,832 ( 0.2 )% The Company recognizes the tax benefit from uncertain tax positions only if it is “more likely than not” that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income tax matters in income tax expense. The Company is also required to assess at each reporting date whether it is reasonably possible that any significant increases or decreases to its unrecognized tax benefits will occur during the next 12 months. The Company did not recognize any uncertain tax positions or any accrued interest and penalties associated with uncertain tax positions for the years ended December 31, 2021 and 2020. The Company files tax returns in the U.S. federal jurisdiction and several state jurisdictions, including New York and California. The Company is generally subject to examination by income tax authorities for three years from the filing of a tax return, therefore, the federal and certain state returns from 2017 forward and the California returns from 2016 forward are subject to examination. The Company currently is not under examination by any tax authority. 25. Pension Plans The Company has a qualified 401(k) defined contribution plan that allows eligible employees of the Company to participate in the plan, subject to limitations. The plan allows for discretionary matching contributions by the Company, up to 4% of eligible annual compensation made by participants of the plan . The Company contributions to the plan were $ 1,347,348 and $ 1,074,323 for the years ended December 31, 2021 and 2020, respectively. 26. Related Party Transactions For the years ended December 31, 2021 and 2020, the Company had several transactions with B. Riley, a principal stockholder, where it paid fees associated with the debt draws and private placements totaling approximately $ 608,614 and $ 1,313,610 , respectively. F- 69 For the years ended December 31, 2021 and 2020, the Company entered into transactions with B. Riley where it borrowed funds under its Delayed Draw Term Note totaling $ 5,086,135 and $ 6,913,865 , respectively. For the years ended December 31, 2021 and 2020, the Company incurred interest on the Senior Secured Note and Delayed Draw Term Note due to B. Riley of $ 6,940,476 and $ 7,123,934 , respectively. Service and Consulting Contracts Ms. Rinku Sen, a former director, and has provided consulting services and operates a channel on the Company’s technology platform. During the year ended December 31, 2020, the Company paid Ms. Sen $ 12,050 for these services. Mr. Josh Jacobs, a former director, has provided consulting services and operates a channel on the Company’s platform. During the year ended December 31, 2020, the Company paid Mr. Jacobs $ 120,000 for these services. On August 26, 2020, the Company entered into a consulting agreement with James C. Heckman, the Company’s former Chief Executive Officer. On June 3, 2021, the consulting agreement was amended that extended the term of the agreement for one-year, or to August 26, 2022, and in connection with the amendment the Company advanced $ 500,000 to Mr. Heckman. During the years ended December 31, 2021 and 2020, the Company recognized consulting fees for Mr. Heckman of $ 779,730 and $1 25,765 , respectively. On October 5, 2020, the Company entered into a separation agreement with Benjamin Joldersma, who served as the Company’s Chief Technology Officer from November 2016 through September 2020, pursuant to which the Company agreed to pay Mr. Joldersma approximately $ 111,000 as a severance payment, as well as any COBRA premiums. Promissory Notes In May 2018, the Company’s then Chief Executive Officer began advancing funds to the Company in order to meet minimum operating needs. Such advances were made pursuant to promissory notes that were due on demand. On October 31, 2020, the Company entered into an exchange agreement with Mr. Heckman pursuant to which Mr. Heckman converted the outstanding principal amount due, together with accrued but unpaid interest under the promissory notes, into 389 shares of Series H Preferred Stock (see Notes 19 and 20). Repurchases of Restricted Stock On December 15, 2020, the Company entered into an amendment for certain restricted stock awards and units that were previously issued to certain employees in connection with the HubPages merger, pursuant to which the Company agreed to repurchase from certain key personnel of HubPages, including Paul Edmondson, one of the Company’s officers, and his spouse, an aggregate of approximately 16,802 shares of the Company’s common stock at a price of $ 4 per share each month for a period of 24 months, for aggregate proceeds to Mr. Edmondson and his spouse of approximately $ 67,207 per month (see Note 12). 27. Commitments and Contingencies Contingent Liability In connection with the Company’s underwritten public offering in February 2022, the Company may have a contingent liability arising out of possible violations of the Securities Act of 1933, as amended (the “Securities Act”) in connection with an investor presentation, which the Company publicly filed. Specifically, the furnishing of the investor presentation publicly may have constituted an “offer to sell” as described in Section 5(b)(1) of the Securities Act and the investor presentation may be deemed to be a prospectus that did not meet the requirements of Section 10 of the Securities Act, resulting in a potential violation of Section 5(b)(1) of the Securities Act. Any liability would depend upon the number of shares purchased by investors who reviewed and relied upon the investor presentation. If a claim were brought by any such investor and a court were to conclude that the public disclosure of such investor presentation constituted a violation of the Securities Act, the Company could be required to repurchase the shares sold to the investors at the original purchase price, plus statutory interest. The Company could also incur considerable expense in contesting any such claims. As of the issuance date of these consolidated financial statements, no legal proceedings or claims have been made or threatened by any investors. The likelihood and magnitude of this contingent liability, if any, is not determinable at this time. F- 70 Claims and Litigation From time to time, the Company may be subject to claims and litigation arising in the ordinary course of business. The Company is not currently a party to any pending or threatened legal proceedings that it believes would reasonably be expected to have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. 28. Subsequent Events The Company performed an evaluation of subsequent events through the date of filing of these consolidated financial statements with the SEC. Other than the below described subsequent events, there were no material subsequent events which affected, or could affect, the amounts or disclosures on the consolidated financial statements . 2019 Equity Incentive Plan From January 2022 through the date these consolidated financial statements were issued, the Company granted common stock options and restricted stock units totaling 200,330 shares of the Company’s common stock, all of which remain outstanding as of the date these consolidated financial statements were issued, to acquire shares of the Company’s common stock to officers, directors, employees and consultants. Line of Credit The balance outstanding under the FastPay line of credit as of the date these consolidated financial statements were issued was approximately $ 7.3 million. Long-Term Debt Senior Secured Note – On January 23, 2022, the Company entered into an amendment with respect to the Senior Secured Note (“Amendment 4”), where the maturity date on the note was extended to (i) December 31, 2023 from December 31, 2022 upon the consummation of the equity financing on February 15, 2022 (further details are under the heading Equity Financing below), or (ii) the date accelerated pursuant to certain terms of Amendment 4. After the date of Amendment 4, interest on the note will be payable, at the agent’s sole discretion, either (a) in cash quarterly in arrears on the last day of each fiscal quarter or (b) by continuing to add such interest due on such payment dates to the principal amount of the note. Interest on the senior secured note will accrue for each calendar quarter on the outstanding principal amount of the note at an aggregate rate of 10.00 % per annum, subject to adjustment in the event of default. Further, interest that was payable during fiscal years 2020 and 2021 and added to the principal amount under the note remains subject to the conversion election under Amendment 1. The balance outstanding under the Senior Secured Note as of the date these consolidated financial statements were issued was approximately $ 64.3 million, which included outstanding principal of approximately $ 48.8 million, payment of in-kind interest of approximately $ 13.9 million that the Company was permitted to add to the aggregate outstanding principal balance, and unpaid accrued interest of approximately $ 1.6 million. Delayed Draw Term Note – On February 15, 2023, pursuant to Amendment 4, the maturity date on the Delayed Draw Term Note was extended to (i) December 31, 2022 from March 31, 2022 for approximately $ 5.9 million and (ii) December 31, 2023 from March 31, 2022 for approximately $ 4.0 million, subject to certain acceleration terms. F- 71 Amendment 4 also provided that interest will be payable, at the agent’s sole discretion, either (a) in cash quarterly in arrears on the last day of each fiscal quarter or (b) in kind quarterly in arrears on the last day of each fiscal quarter, and will accrue for each fiscal quarter on the principal amount outstanding under the note at an aggregate rate of 10.00 % per annum, subject to adjustment in the event of default. The balance outstanding under the Delayed Draw Term Note as of the date these consolidated financial statements were issued was approximately $ 10.2 million, which included outstanding principal of approximately $ 8.7 million, and payment of in-kind interest of approximately $ 1.2 million that the Company was permitted to add to the aggregate outstanding principal balance, and unpaid accrued interest of approximately $ 0.3 million. Series L Preferred Stock The rights agreement pursuant to the Series L Preferred Stock is set to expire on May 3, 2022; however, the Board elected to extend the termination date, which extension is subject to ratification by the Company’s stockholders. Common Stock Issuances Stock Purchase Agreements – On January 24, 2022, we entered into several stock purchase agreements with several of the Company’s investors, pursuant to which the Company issued an aggregate of 505,671 shares at a price equal to $ 13.86 per share, which was determined based on the volume-weighted average price of the Company’s common stock at the close of trading on the sixty (60) previous trading days, to the investors in lieu of an aggregate of approximately $ 7.01 million owed in Liquidated Damages. The Company agreed that it would prepare and file as soon as reasonably practicable, a registration statement covering the resale of these shares of the Company’s common stock issued in lieu of payment of these liquidated damages in cash. Public Offering – On February 15, 2022, the Company raised approximately $ 34.5 million under a firm commitment underwritten public offering with the sale of 3,636,364 shares of the Company’s common stock, par value $ 0.01 per share, at a public offering price of $ 8.25 per share. Pursuant to the terms of the underwriting agreement, dated February 10, 2022, a 30-day option to purchase up to 545,454 additional shares was granted by and between B. Riley Securities, Inc., as an underwriter and as representative of the other underwriters. The underwriter’s overallotment option for 545,239 shares of the Company’s common stock was exercised in March 2022. The Company received approximately $31.5 million (includes $4.2 million with the overallotment option), after deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company. Common Stock Options On March 18, 2022, the Company approved a repricing of certain outstanding stock options under the Company’s 2016 Plan and 2019 Plan that had an exercise price above $ 8.82 per share, including certain outstanding stock options held by senior management of the Company. The repricing also included certain outstanding stock options granted outside of the 2016 Plan and 2019 Plan, which repricing is still subject to stockholder approval. As a result of the repricing, the exercise price was set to $ 8.82 per share, which was the closing sale price of the Company’s common stock as listed on the NYSE American exchange on March 18, 2022. Except for the repricing of the stock options under the 2016 Plan, all term and conditions of each stock option remains in full force and effect. For the repricing of the stock options under the 2019 Plan, the Company (i) modified the exercise price; (ii) will allow cashless exercise as a method of paying the exercise price, and (iii) will waive a lock-up provision in the stock option agreements. All other term and conditions of each of the stock options under the 2019 Plan remains in full force and effect. Proposed Acquisition The Company entered into a non-binding letter of intent to acquire 100 % of the issued and outstanding equity interests of Athlon Holdings, Inc. (“Athlon”) for an anticipated purchase price of $ 16.0 million, comprised of (i) a cash portion of $ 13.0 million, with $ 10 million to be paid at closing and $ 3.0 million to be paid post-closing and (ii) an equity portion of $ 3.0 million to be paid in shares of the Company’s common stock. The acquisition is subject to the preparation and negotiation of definitive documents, completion of due diligence, and the agreement of a certain number of key employees of Athlon to remain as employees post-closing, among other items. F- 72