What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-06-04 compared with 2023-05-10 · 759 added, 1002 removed, 791 unchanged (69% of the section changed)

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TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Yusufali & Associates, LLC, Independent Registered Public Accounting Firm (PCAOB ID:

of Yusufali & Associates, LLC, Independent Registered Public Accounting Firm (PCAOB ID:

Consolidated Balance Sheets as of December 31, 2023 and 2022 (as restated)

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Consolidated Statements of Equity for the Years ended December 31, 2023 and 2022 (as restated)

Consolidated Statements of Cash Flows for the Years ended December 31, 2021 and 2020 (as restated)

Statements of Cash Flows for the Years ended December 31, 2023 and 2022 (as restated)

Notes to Consolidated Financial Statements (as restated)

& Associates, LLC

Public Accountants & IT Consultants

HITRUST, PCAOB, PCIDSS, & ISC2 Registered

Yusufali & Associates, LLC

Certified Public Accountants & IT Consultants

AICPA, HITRUST, PCAOB, PCIDSS, & ISC2 Registered

55 Addison Drive, Short Hills, NJ 07078

of Independent Registered Public Accounting Firm

the Board of Directors and Stockholders of Lottery.com Inc.

Spicewood, Texas

the Board of Directors and Stockholders of

on the Consolidated Financial Statements

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then ended in conformity with accounting principles generally accepted in the United States of America.

accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note

2 to the financial statements, the Company has stockholder’s deficit, net losses, and negative working capital.

These factors raise

substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans in regard to these matters

are also described in Note 2.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Company’s management is responsible for these consolidated financial statements.

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conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the consolidated 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.

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.

Those standards require that we plan and perform the audit to

obtain reasonable assurance about whether the consolidated 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

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.

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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 consolidated 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 consolidated financial statements.

Such procedures included examining, on a test basis,

evidence regarding the amounts and disclosures in the consolidated 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

consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

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The management listed the critical audit matters in the notes on accounts as they relate to the current period audit

of the financial statements, specifically to (1) Note 3 that refers to the to $30,000,000.00 revenue recognition as the core basis for

the restatement of the Financial Statements (2) relate to accounts or disclosures that are material to the financial statements and (3)

involved our especially challenging, subjective, or complex judgments.

These critical audit matters do not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by referring the critical audit matters, providing separate opinions on

the critical audit matters or on the accounts or disclosures to which they relate.

of the financial statements, specifically to (1) Note 2 revenue recognition as the core basis for the restatement of the Financial Statements

(2) relate to accounts or disclosures that are material to the financial statements and (3) involved especially challenging, subjective,

or complex judgments.

These critical audit matters do not alter in any way our opinion on the financial statements, taken as a whole,

and we are not, by referring the critical audit matters, providing separate opinions on the critical audit matters or on the accounts

or disclosures to which they relate.

Managing Partner

& Associates, LLC

Short Hills, NJ

registration # 3313

have served as the company’s auditor since 2022

BALANCE SHEETS

(As Restated)

LOTTERY.COM, INC.

BALANCE SHEETS (RESTATED)

Current assets:

Cash and cash equivalents

Restricted cash

Accounts receivable

Prepaid expenses

Other current assets

Total current assets

Intangible assets, net

Property and equipment, net

$ 104,534,006

LIABILITIES AND STOCKHOLDERS’ EQUITY

current assets

Notes receivable

and equipment, net

long-term assets

AND STOCKHOLDERS’ EQUITY

Current liabilities:

Trade payables

Deferred revenue

Convertible debt, net - current

Notes payable - current

Accrued interest

Accrued and other expenses

Total current liabilities

payable - current

and other expenses

current liabilities

debt, net - noncurrent

long-term liabilities

Convertible debt, net - non current

Other long term liabilities

Total long-term liabilities

Total liabilities

Commitments and contingencies

Controlling Interest

Preferred Stock, par value $ 0.001 , 1,000,000 shares authorized, none issued and outstanding

Common stock, par value $ 0.001 , 500,000,000 shares authorized, 50,256,317 and 22,658,006 issued and outstanding as of December 31, 2021 and 2020, respectively

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated deficit

long-term liabilities

and contingencies (Note 13)

Equity Controlling

Preferred Stock, par value $ 0.001 , 1,000,000

shares authorized, no ne

issued and outstanding

stock, par value $ 0.001 ,

500,000,000 shares

authorized, 2,877,045 and

2,527,045 issued

and outstanding as of December 31, 2023 and December 31, 2022, respectively

paid-in capital

other comprehensive loss

( 235,106,206 )

( 208,187,210 )

Total Lottery.com Inc.

Total Lottery.com

stockholders’ equity

Noncontrolling interest

Total liabilities and stockholders’ equity

$ 104,534,006

accompanying notes are an integral part of these consolidated financial statements.

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

Years Ended December 31,

Cost of revenue

Noncontrolling

liabilities and stockholders’ equity

accompanying notes are an integral part of these restated consolidated financial statements.

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (RESTATED)

Ended December 31,

and administrative

and amortization

operating expenses

Personnel costs

Professional fees

General and administrative

Depreciation and amortization

Total operating expenses

Loss from operations

( 25,167,116 )

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Other expenses

Interest expense

Reserve loss of prepaid advertising credits

Other expense

Total other expenses, net

Net loss before income tax

$ ( 54,574,981 )

$ ( 5,811,863 )

Income tax expense (benefit)

other expenses, net

before income tax

( 25,679,655 )

tax expense (benefit)

( 25,739,655 )

( 60,383,265 )

Other comprehensive loss

Foreign currency translation adjustment, net

Comprehensive loss

Other comprehensive

currency translation adjustment, net

Comprehensive

( 25,809,928 )

( 60,378,988 )

Net income attributable to noncontrolling interest

Net loss attributable to Lottery.com Inc.

income attributable to noncontrolling interest

loss attributable to Lottery.com Inc.

$ ( 25,537,315 )

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Net loss per common share

Basic and diluted

Weighted average common shares outstanding

Basic and diluted

accompanying notes are an integral part of these consolidated financial statements.

Weighted average common shares

and diluted recheck WA shares

accompanying notes are an integral part of these restated consolidated financial statements.

STATEMENTS OF EQUITY

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Noncontrolling

Stockholders’

Balance as of December 31, 2019

Stockholder’s

as of December 31, 2021

( 148,188,138 )

of common stock upon stock option exercise

of common stock for legal settlement

based compensation

comprehensive loss

Comprehensive

( 59,999,072 )

Beneficial conversion feature

Issuance of digital securities

Stock-based compensation

( 59,999,072 )

( 60,378,988 )

as of December 31, 2022

$ 267,597,370

Balance as of December 31, 2020

$ ( 208,187,210 )

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$ ( 208,187,210 )

based compensation

comprehensive loss

period adjustments made to accumulated deficit

( 1,381,681 )

Issuance of common stock upon

stock option exercise

Issuance of common stock upon

warrant exercise

Effect of reverse capitalization,

Conversion of convertible debt

Issuance of common stock in

business acquisition

Beneficial conversion feature

on notes payable

Issuance of digital securities

Stock-based compensation (Restated)

Minority interest in business

acquisition (Restated)

Other comprehensive loss

loss (Restated)

( 1,406,413 )

( 1,413,548 )

Comprehensive

( 25,537,315 )

Balance as of December

31, 2021 (Restated)

( 25,537,315 )

( 25,809,928 )

as of December 31, 2023

$ 269,690,569

$ ( 235,106,206 )

accompanying notes are an integral part of these consolidated financial statements.

STATEMENTS OF CASH FLOWS

Cash flow from operating activities

Net loss attributable to Lottery.com Inc.

$ 269,690,569

$ ( 235,106,206 )

Adjustments to reconcile net loss to net cash used in operating activities:

Net income attributable to noncontrolling interest

Depreciation and amortization

Non-cash interest expense

Stock-based compensation expense

Forgiveness of PPP Loan

Loss on extinguishment of debt

Issuance of debt to pay expenses

Income tax valuation allowance

The accompanying notes are an integral part of these restated consolidated financial statements.

STATEMENTS OF CASH FLOWS (RESTATED)

Ended December 31,

flow from operating activities

loss attributable to Lottery.com Inc.

$ ( 25,537,315 )

Other non-cash items, net

Changes in assets & liabilities:

Accounts receivable

Prepaid expenses

Other current assets

Trade payables

$ ( 59,999,072 )

Deferred revenue

to reconcile net loss to net cash used in operating activities:

income attributable to noncontrolling interest

and amortization

compensation expense

on impairment of goodwill and intangibles

of common stock for legal settlement

assets & liabilities:

( 2,000,000 )

Accrued interest

Accrued and other expenses

Other long term liabilities

Net cash provided by operating activities

current assets

and other expenses

long-term assets

( 13,009,686 )

Cash flow from investing activities

Purchases of property and equipment

Purchases of intangible assets

Investment in subsidiary, net

long-term liabilities

Prior period adjustments to Accumulated Deficit

cash used by operating activities

( 2,109,222 )

Net cash used in investing activities

( 31,272,729 )

Cash flow from financing activities

Issuance of digital securities

Proceeds from exercise of options and warrants

Proceeds from issuance of convertible debt

Payment of debt issuance costs

flow from investing activities

of property and equipment

of intangible assets

( 1,124,823 )

Proceeds from issuance of notes payable

Proceeds from reverse recapitalization

Principal payments on debt

cash used in investing activities

( 1,252,088 )

Net cash provided by financing activities

Effect of exchange rate changes on cash

Net change in net cash and restricted cash

Cash and restricted cash at beginning of period

Cash and restricted cash at end of period

Supplemental Disclosure of Cash Flow Information:

Interest paid in cash

Taxes paid in cash

Non cash investing and financing activities

Conversion of convertible debt into common stock

Capitalization of interest from loan extinguishment

Purchase of intangible assets through the issuance of convertible debt

Issuance of convertible debt in exchange for outstanding liabilities

Issuance of convertible debt in exchange for notes payable

Common stock issued as part of acquisition

Beneficial conversion feature on notes payable

accompanying notes are an integral part of these consolidated financial statements.

TO CONSOLIDATED FINANCIAL STATEMENTS

Nature of Operations

flow from financing activities

from issuance of notes payable

on notes payable - related parties

provided by financing activities

exchange rate changes on cash

in net cash and restricted cash

( 32,536,204 )

and restricted cash at beginning of period

and restricted cash at end of period

Disclosure of Cash Flow Information:

accompanying notes are an integral part of these restated consolidated financial statements.

TO RESTATED CONSOLIDATED FINANCIAL STATEMENTS

During FY 2023, the Company addressed

legacy issues while successfully regaining full compliance with Nasdaq’s continued listing rules and restarting operations in order

to stage Lottery.com for growth in FY 2024.

The cornerstone of the Company’s operational progress for FY 2024 will be

driven by technology, product and service/capability enhancements.

This Amended Report is reflective of the Company’s commitment to

transparency, integrity, and responsible corporate governance.

The investment

commitments from United Investments Capital London, including Prosperity Investment Management and others, and investors placed by Univest

Securities LLC, outlined in this report are evidence of investor belief in Management’s capability to resume core lottery and gaming

operations, monetize the Sports.com brand, and expand all the Company’s brands across the globe.

(formerly Trident Acquisitions Corp) (“TDAC”, “Lottery.com” or “the Company”), was formed as

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subscribers and provide access to other proprietary, anonymized transaction data pursuant to multi-year contracts (“Data Service”).

a provider of lottery products and services, the Company is required to comply, and its business is subject to, regulation in each jurisdiction

in which the Company offers the B2C Platform, or a commercial partner offers users access to lottery games through the B2B API.

it must also comply with the requirements of federal and other domestic and foreign regulatory bodies and governmental authorities in

jurisdictions in which the Company operates or with authority over its business.

The Company’s business is additionally subject

to multiple other domestic and international laws, including those relating to the transmission of information, privacy, security, data

retention, and other consumer focused laws, and, as such, may be impacted by changes in the interpretation of such laws.

June 30, 2021, the Company acquired interest in Medios Electronicos y de Comunicacion, S.A.P.I de C.V.

(“Aganar”) and JuegaLotto,

a provider of lottery products and services, the Company is required to comply with, and its business is subject to, regulation in each

jurisdiction in which the Company offers the B2C Platform, or a commercial partner offers users access to lottery games through the B2B

In addition, it must also comply with the requirements of federal and other domestic and foreign regulatory bodies and governmental

authorities in jurisdictions in which the Company operates or with authority over its business.

The Company’s business is additionally

subject to multiple other domestic and international laws, including those relating to the transmission of information, privacy, security,

data retention, and other consumer focused laws, and, as such, may be impacted by changes in the interpretation of such laws.

June 30, 2021, the Company acquired an interest in Medios Electronicos y de Comunicacion, S.A.P.I de C.V.

(“Aganar”) and

JuegaLotto, S.A.

(“JuegaLotto”).

Aganar has been operating in the licensed iLottery market in Mexico since 2007 as an online

retailer of Mexican National Lottery draw games, instant digital scratch-off games and other games of chance.

JuegaLotto is licensed

by the Mexican federal regulatory authorities to sell international lottery games in Mexico.

Aganar has been operating in the licensed iLottery market in Mexico since 2007 as

an online retailer of Mexican National Lottery draw games, instant digital scratch-off games and other games of chance.

JuegaLotto is

licensed by the Mexican federal regulatory authorities to sell international lottery games in Mexico.

July 28, 2022, the Board determined that the Company did not currently have sufficient financial resources to fund its operations or

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Subsequently, the Company has had minimal day-to-day operations

and has primarily focused its operations on restarting certain aspects of its core business (the “Plans for Recommencement of Company

Operations”).

April 25, 2023, as part of the Plans for Recommencement of Company Operations, the Company resumed its ticket sales operations to support

its affiliate partners through its Texas retail network.

and has primarily focused its operations on restarting certain aspects of its core businesses (the “Plans for Recommencement of

Company Operations”).

April 25, 2023, as part of the Plans for Recommencement of Company Operations, the Company resumed its ticket sales operations on a limited

basis to support its affiliate partners through its Texas retail network.

Significant Accounting Policies

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amounts or the amounts and classifications of liabilities that might result if the Company is unable to continue as a going concern.

to the requirements of the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) Topic 205-40,

Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, management must evaluate whether there are

conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going

concern for one year from the date these financial statements are issued.

This evaluation does not take into consideration the potential

mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the

date the financial statements are issued.

When substantial doubt exists under this methodology, management evaluates whether the mitigating

effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern.

The mitigating

effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented

within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will

mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern

within one year after the date that the financial statements are issued.

to losses experienced by the Company’s Operational Cessation, the Company has experienced recurring net losses and negative cash

flows from operations and has an accumulated deficit of approximately $ 148 million and a working capital deficiency of approximately

$ 45.3 million at December 31, 2021.

For the year ending December 31, 2021, the Company sustained a net loss of $ 53 million.

sustained a loss from operations of $ 29.9 million and $ 3.7 million for the years ending December 31, 2021 and 2020, respectfully.

Subsequently,

the Company sustained additional operating losses and anticipates additional operating losses for the next twelve months.

These conditions

raise substantial doubt about the Company’s ability to continue as a going concern .

Company has historically funded its activities to date almost exclusively from debt and equity financing.

Management’s plans in

order to meet its operating cash flow requirements include financing activities such as private placements of its common stock, preferred

stock offerings, and issuances of debt and convertible debt.

Although Management believes that it will be able to continue to raise funds

by sale of its securities to provide the additional cash needed to meet the Company’s obligations as they become due beginning

with a loan agreement the Company entered into with Woodford Eurasia Assets, Ltd.

(“Woodford”) on December 7, 2022 (see Subsequent

Events), the Plans for Recommencement of Company Operations to require substantial funds to implement and there is no assurance that

to the requirements of the Financial Accounting Standards Board’s ASC Topic 205-40, Disclosure of Uncertainties about an Entity’s

Ability to Continue as a Going Concern, management must evaluate whether there are conditions or events, considered in the aggregate,

that raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial

statements are issued.

This evaluation does not take into consideration the potential mitigating effect of management’s plans that

have not been fully implemented or are not within control of the Company as of the date the financial statements are issued.

When substantial

doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial

doubt about the Company’s ability to continue as a going concern.

The mitigating effect of management’s plans, however, is

only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial

statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that

raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial

statements are issued.

connection with the Company’s Operational Cessation, the Company has experienced recurring net losses and negative cash flows from

operations and has an accumulated deficit of approximately $ 235.1

million and working capital of approximately negative $ 7.5

million on December 31, 2023.

For the year ending

December 31, 2023, the Company sustained a net loss of $ 25.5

The Company sustained a loss from operations

of $ 55.9 million

and $ 53.0 million

for the years ending December 31, 2022 and 2021, respectively.

Subsequently, the Company sustained additional operating losses and anticipates

additional operating losses for the next twelve months.

These conditions raise substantial doubt about the Company’s ability to

continue as a going concern.

Company has historically funded its activities almost exclusively from debt and equity financing.

Management’s plans in order to

meet its operating cash flow requirements include financing activities such as private placements of its common stock, preferred stock

offerings, and issuances of debt and convertible debt.

Although Management believes that it will be able to continue to raise funds by

sale of its securities to provide the additional cash needed to meet the Company’s obligations as they become due beginning with

a loan agreement the Company entered into with United Capital Investments Ltd.

(“UCIL”) on July 21, 2023, the Plans for Recommencement of Company Operations to require substantial funds to implement and there is no assurance that

the Company will be able to continue raising the required capital.

Company’s ability to continue as a going concern for the next twelve months from the issuance of these financial statements depends

on its ability to execute its business plan, increase revenue, and reduce expenditures.

Such conditions raise substantial doubt about

the Company’s ability to continue as a going concern.

The Company’s ability to continue as a going concern for the next twelve months from the issuance of these financial statements

depends on its ability to execute the business plan for the relaunch of its core business, the successful monetization of Sports.com,

and keep expenditures in line with available operating capital.

Such conditions raise substantial doubt about the Company’s ability

to continue as a going concern.

of Trident Acquisition Corp.

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Non-controlling

interests represent the proportionate ownership of Aganar and JuegaLotto, held by minority members and reflect their capital investments

interest represents the proportionate ownership of Aganar and JuegaLotto, held by minority members and reflect their capital investments

as well as their proportionate interest in subsidiary losses and other changes in members’ equity, including translation adjustments.

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of Credit Risks

Financial instruments that are potentially subject to concentrations of

credit risk are primarily cash.

Cash holdings deposits are placed with major financial institutions deemed to be of high-credit-quality

in order to limit credit exposure.

The Company maintains deposits and certificates of deposit with banks which may exceed the Federal

Deposit Insurance Corporation (“FDIC”) insured limit and money market accounts which are not FDIC insured.

In addition, deposits

aggregating approximately $ 19,790 at April 30, 2023 are held in foreign banks.

Management believes the risk of loss in connection with these accounts

instruments that are potentially subject to concentrations of credit risk are primarily cash.

Cash holdings are placed with major financial

institutions deemed to be of high-credit-quality in order to limit credit exposure.

The Company maintains deposits and certificates of

deposit with banks which may exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limit and money market accounts

which are not FDIC insured.

In addition, deposits aggregating approximately $ 13,356 at May 22, 2024 are held in foreign banks.

believes the risk of loss in connection with these accounts is minimal.

preparation of the financial statements requires management to make estimates and assumptions to determine the reported amounts of assets,

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and Restricted Cash

of December 31, 2021 and 2020, cash comprised of cash deposits, and deposits with some banks exceeded federally insured limits with the

majority of cash held in one financial institution.

of December 31, 2023 and 2022, cash was comprised of cash deposits, and deposits with some banks exceeded federally insured limits with

the majority of cash held in one financial institution.

Management believes all financial institutions holding its cash are of high credit

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Company had no marketable securities as of December 31, 2023 and December 31, 2022.

of December 31, 2020, restricted cash included $ 6,950,000 escrow deposit related to the Company’s future performance obligations

to provide data access to a third party under a Master Service Agreement dated December 12, 2020.

As of December 31, 2021, the restricted

cash balance was $ 0 as the Company met all requirements in the agreement.

(See Subsequent Events – In 2022, the Company pledged

$ 30,000,000 for a third-party a line of credit which was subsequently claimed for settlement of such line of credit)

of December 31, 2022, the restricted cash balance was $ 0

as the bank took the collateral in the restricted account during

October of 2022 in order to satisfy the amount owed under the Line of Credit.

(See Subsequent Events - In January of 2022, the Company

pledged $ 30,000,000 for

a line of credit which was subsequently claimed for settlement of such line of credit).

Company through its various merchant providers pre-authorizes forms of payment prior to the sale of digital representation of lottery

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each period and records a bad debt provision for accounts receivable it believes it may not collect in full.

The Company did not record

any allowance for uncollectible receivables as of December 31, 2021 and 2020.

The Company increased its allowance for uncollectible receivables as of

December 31, 2023 by $ 10,000 .

At December 31, 2023 and December 31, 2022 the allowance for uncollectible receivables was $ 84,520 .

The Company has not incurred bad debt expense historically.

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The Company entered into

an agreement with a third party to provide advertising services and issued equity instruments as compensation for the advertising

services (“Prepaid advertising credits”).

an agreement with a third party to provide advertising services and issued equity instruments as compensation for the advertising services

(“Prepaid advertising credits”).

The Company expenses the service as it is performed by the third party.

The value of the

services provided were used to value these contracts, except the Company expensed reserve loss of prepaid advertising credits of

for the year ended The current portion of prepaid expenses is included in current assets on the consolidated balance sheets.

Company has remaining prepaid expenses of $ 22,013,110

and $ 22,896,638 for the

years ended December 31, 2021 and 2020, respectfully.

services provided were used to value these contracts, except for the year ended December 31, 2021 the Company reserved for potential

inability to realize $ 2,000,000 of prepaid advertising credits in future periods.

The current portion of prepaid expenses is included

in current assets on the consolidated balance sheets.

The Company has remaining prepaid expenses of $ 19,020,159 and $ 19,409,323 for the

years ended December 31, 2023 and 2022, respectively.

August 2, 2018, AutoLotto purchased 186,666 shares of Class A-1 common stock of a third-party business development partner representing

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of property and equipment is computed using the straight-line method over the following estimated useful lives:

Schedule of Depreciation of Property and Equipment

of Depreciation of Property and Equipment

Computers and equipment

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that an impairment may have occurred in accordance with the provisions of ASC 350, “ Goodwill and Other Intangible Assets ”.

The Company reviewed for impairment and determined that no impairment indicators exist as of December 31, 2021 and 2020.

6 for further discussion.

the new standard, Accounting Standards Update (“ASU”) 2014-09, “ Revenue from Contracts with Customers (Topic 606) ”,

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a point in time.

The Company receives consideration for lottery game sales at the time of delivery to the customer, which may be the user or

commercial partner, as applicable.

The Company receives consideration for lottery game sales at the time of delivery to the customer, which may be the

user or commercial partner, as applicable.

There is no variable consideration related to lottery game sales.

As each individual lottery game

delivered represents a distinct performance obligation and consideration for each game sale is fixed, representing the standalone selling

price, there is no allocation of consideration necessary.

As each individual lottery

game delivered represents a distinct performance obligation and consideration for each game sale is fixed, representing the standalone

selling price, there is no allocation of consideration necessary.

accordance with Accounting Standards Codification (“ASC”) 606, the Company evaluates the presentation of revenue on a gross

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of all lottery game sales as it retains physical possession of lottery game sales tickets from time of sale until the point of redemption.

The Company also retains inventory risk an all lottery game sales tickets as they would be responsible for any potential winnings related

The Company also retains inventory risk on all lottery game sales tickets as they would be responsible for any potential winnings related

to lost or unredeemable tickets at the time of redemption.

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Advertising costs for the years ended December 31, 2023 and 2022 were approximately

and $ 66,000 , respectively.

$ 377,000 and $ 1,261,000

respectively.

both financial accounting and tax reporting purposes, the Company reports income and expenses based on the accrual method of accounting.

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any resulting income taxes.

Therefore, in relation to the income and losses incurred by the limited liability companies, they have been

consolidated in the Company’s tax return and provision based upon its relative ownership.

Therefore, the income and losses incurred by the limited liability companies have been consolidated in the

Company’s tax return and provision based upon its relative ownership.

taxes are accounted for in accordance with ASC 740, “ Income Taxes ” (“ASC 740”), using the asset and liability

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the taxing authorities can audit the previous three years of tax returns and in certain situations audit additional years.

tax purposes, the Company’s 2018 through 2021 tax years generally remain open for examination by the tax authorities under the

normal three-year statute of limitations.

For state tax purposes, the Company’s 2017 through 2021 tax years remain open for examination

by the tax authorities under the normal four-year statute of limitations.

federal tax purposes, the Company’s 2020 through 2023 tax years generally remain open for examination by the tax authorities

under the normal three-year statute of limitations.

For state tax purposes, the Company’s 2019 through 2023 tax years remain

open for examination by the tax authorities under the normal four-year statute of limitations.

Value of Financial Instruments

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of the fair value hierarchy under ASC 820 are described below:

1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets

or liabilities

1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or

2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially

1 unchanged sentence

3 - Valuation is generated from model-based techniques that use significant assumptions not observable in the market.

unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability.

These unobservable

assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability.

Determination

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2016-13, Financial Instruments - Credit Losses (Topic 326) :

Measurement of Credit

Losses on Financial Instruments (“ASU 2016-13”).

ASU 2016-13 requires the measurement of all expected credit losses for

financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.

Adoption of ASU 2016-13 will require the Company to use forward-looking information to formulate its credit loss estimates.

is effective for annual reporting periods beginning after December 15, 2022, and early adoption is permitted.

The Company is currently

evaluating this new standard and currently does not expect it to have a significant impact on the Company’s consolidated financial

Measurement of Credit Losses

on Financial Instruments (“ASU 2016-13”).

ASU 2016-13 requires the measurement of all expected credit losses for financial

assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.

of ASU 2016-13 will require the Company to use forward-looking information to formulate its credit loss estimates.

ASU 2016-13 is effective

for annual reporting periods beginning after December 15, 2022, and early adoption is permitted.

The Company is currently evaluating

this new standard and currently does not expect it to have a significant impact on the Company’s consolidated financial statements.

December 2019, the FASB issued ASU No 2019-12, Income Taxes (Topic 740):

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2020-09, Debt (Topic 470) (“ASU 2020-09”).

ASU 2020-09 a mendments to SEC paragraphs

ASU 2020-09 amendments to SEC paragraphs

pursuant to SEC release NO.

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Restatement of Financial Statements

of the Company re-evaluated its accounting for year ending December 31, 2021, the Company determined to restate its previously

issued financial statements as of December 31, 2021 and the year then ended to correct accounting errors related to cash on hand,

accounts receivable, prepaid expenses, deferred revenue, accrued expenses, revenue, costs of revenue, reserve losses of prepaid

advertising credits and stock-based compensation which caused the following misstatements:

of the Company re-evaluated its accounting for year ending December 31, 2023, the Company determined to restate its previously issued

financial statements as of December 31, 2023 to correct accounting errors related to goodwill, current assets, revenue, and equity.

following tables summarize the effect of the restatements on the specific items presented in our previously reported financial statements:

of Restatements of Financial Statements

(As Restated)

Current assets:

( 30,000,000 )

BALANCE SHEETS (RESTATED)

of Restatements on Previously Reported Financial Statements

Fiscal Year Ended December 31, 2023

As Previously

Accounts receivable

( 21,617,472 )

Prepaid expenses

Other current assets

Total current assets

Long-term assets

Notes receivable

( 1,653,067 (2)

Intangible assets, net

Property and equipment, net

Other long term assets

$ ( 1,571,383 (1)(2)

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Trade payables

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Accrued and other expenses

( 160,426 (5)

Other liabilities

Total current liabilities

Long-term liabilities:

Other long term liabilities

Total long-term liabilities

Total liabilities

Commitments and contingencies

Controlling Interest

Preferred Stock, par value $ 0.001 , 1,000,000 shares authorized, none issued and outstanding

Common stock, par value $ 0.001 , 500,000,000 shares authorized, 50,256,317 and 22,658,006 issued and outstanding as of December 31, 2021 and 2020, respectively

( 138,566 (3) to (6)

Additional paid in capital

( 1,049,206 )

Accumulated other comprehensive loss

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( 233,759,640 )

( 41,955,620 )

1,346,566 (1) to (7)

( 235,106,206 )

Noncontrolling interest

Total Lottery.com Inc.

stockholders’ equity

Noncontrolling interest

1,432,817 (1) to (7)

Total liabilities and stockholders’ equity

$ ( 1,571,383

$ 104,534,006

STATEMENT OF OPERATIONS

Years Ended December 31,

accompanying notes are an integral part of these consolidated financial statements.

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (RESTATED)

Year Ended December 31,

(As Previously Reported)

(As Restated)

( 52,117,472 )

Cost of revenue

( 11,000,000 )

Operating expenses:

1 unchanged sentence

( 24,182,724 )

Other expenses

Interest expense

Reserve loss of prepaid advertising credits

Other expense

Total other expenses, net

$ ( 25,167,116 )

Net loss before income tax

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$ ( 25,739,655 )

( 10,955,026 )

( 52,910,646 )

Other comprehensive loss

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( 25,537,315 )

( 53,048,225 )

Net loss per common share

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Basic and diluted

STATEMENT OF CASH FLOWS

(As Restated)

accompanying notes are an integral part of these consolidated financial statements.

STATEMENTS OF CASH FLOWS

Ended December 31,

Cash flow from operating activities

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Adjustments to reconcile net loss to net cash used in operating activities:

$ ( 1,049,206 )

Net income attributable to noncontrolling interest

Depreciation and amortization

Stock-based compensation expense

Loss on impairment of intangibles

Changes in assets & liabilities:

Accounts receivable

( 21,636,324 )

Prepaid expenses

( 9,000,000 )

Other current assets

Trade payables

( 1,171,557 )

( 1,557,570 )

Deferred revenue

( 7,101,258 )

( 6,735,965 )

Accrued interest

Accrued and other expenses

Other long term liabilities

Other liabilities

Other long term assets

Prior period adjustments to Accumulated Deficit (8)

Net cash provided by operating activities

( 2,028,602 )

Cash flow from investing activities

Purchases of property and equipment

Purchases of intangible assets

( 2,109,222 )

Investment in subsidiary, net

( 10,012,540 )

( 3,386,868 )

( 13,399,408 )

Cash flow from investing activities

Net cash used in investing activities

( 15,232,760 )

( 13,944,776 )

Cash flow from financing activities

Issuance of digital securities

Proceeds from exercise of options and warrants

Proceeds from issuance of convertible debt

Payment of debt issuance costs

( 1,115,031 )

Proceeds from issuance of notes payable

Proceeds from reverse recapitalization

Principal payments on debt

( 11,647,713 )

Net cash provided by financing activities

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Net change in net cash and restricted cash

( 30,000,000 )

Cash and restricted cash at beginning of period

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specific explanations for the items noted above in the restated financial statements are as follows:

January 4, 2022, AutoLotto entered into a Business Loan Agreement (the “Business Loan”)

with The Provident Bank (“Provident”), pursuant to which the Company borrowed

$ 30,000,000 from Provident, which was evidenced by a $ 30,000,000 Promissory Note.

In accordance

with the terms of the Business Loan, upon entering into the agreement, $ 30,000,000 in a separate

account with Provident was pledged as security for the amount outstanding under the loan

(“Collateral Security”).

The $ 30,000,000 Collateral Security became restricted

and remained restricted until October 12, 2022, when AutoLotto defaulted on its obligations

under the Business Loan and Provident foreclosed on the $ 30,000,000 of Collateral Security.

The Collateral Security, which was in the form of restricted cash, was presented as a contingent

liability on the Company’s balance sheet from March 31, 2022 until the obligation was

satisfied in October of 2022.

reexamination of various transactions that occurred in 2021 and which were later rescinded

or canceled in 2022, the Company has restated revenue on its financial statements for the

year ended December 31, 2021, to reflect a change in the recognition of income in accordance

with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC)

September 20, 2021, the Company entered into a purchase agreement with a major customer for the sale of various service credits with

a total purchase price of $30 million dollars.

Upon execution of the purchase agreement, the Company recognized the income and the

customer was required make payment within 90 days.

The customer provided payment prior to December 31, 2021, in the form of a check

accepted by the Company for deposit and included in undeposited funds.

During 2022, the Company discovered that the original service

credits were non-transferrable and that the Company had pledged its own cash accounts to secure a line of credit in the amount of

$30,000,000 utilized by the customer to provide the Company with payment towards the purchase of the service credits.

Company was prohibited from transferring the advertising portion of the service credits and could not complete the sale of such

credits, the Company cancelled the transaction and could not recognize the income, nor recognize a cash payment in the

Company’s financial statements.

In addition, the Company had recorded cost of sales and a corresponding pre-paid expense

related to this transaction in the amount of $10,000,000.

As a result, in the restated December 31, 2021 financial statements, the

Company decreased both cash and revenue by $30,000,000, for the year ended December 31, 2021;

and reversed the cost of sales

resulting in a decrease to cost of sales and an increase to pre-paid expense by $10,000,000 each for the year ended December 31,

addition, the Company had invoiced the customer a further $ 17,117,472 for various services

and advertising credits for the year ended December 31, 2021 and $ 18,539,472 during the three

months ending March 31, 2022.

The Company recorded such amounts to both revenue and accounts

receivable, respectfully.

As a result of the cancellation of the transaction due to the inability

of the Company to transfer the credits and related services, the Company decreased

both accounts receivables and revenues by $ 17,117,472 , in the restated financial statements

for the year ended December 31, 2021;

and $ 18,539,472 , in the restated financial statements

for the three months ended March 31, 2022.

total adjustment to accounts receivable was an increase of $ 21,617,472 .

total adjustment to pre-paid expenses was a decrease of $ 9,000,000 .

total adjustment to accrued expense and other expenses was an increase of $ 112,647 .

total adjustment to revenue was a decrease of $ 52,117,472 .

total adjustment to cost of revenue was an increase of $ 11,000,000 .

the Company’s reassessment of all accounts as of December 31, 2021, the Company determined that approximately $ 2,000,000

of prepaid advertising credits purchased during 2017 and 2018 may not be able to be fully utilized.

As a result, the Company

decreased prepaid expenses of $ 2,000,000

and increased its loss reserve for prepaid advertising credits by $ 2,000,000 ,

in the restated financial statements for the year ended December 31, 2021.

the termination of several officers and employees subsequent to December 31, 2022 and the

cancelation of various options and/or warrants held by these individuals, the Company, the

Company decreased stock-compensation expense in the amount of $ 1,049,206 .

an unrelated transaction, the Company entered into an agreement with another customer totaling

$ 5,000,000 in 2021.

The Company recognized the full amount of the contract and recorded $ 5,000,000

as revenue and accounts receivable for the year ended December 31, 2021.

The Company started

performing the services under the agreement during 2021, which services were to be completed

During October of 2021, the customer paid $ 500,000 towards

these services.

Subsequently, the Company determined that, in accordance with ASC 606, due

to an uncertainty of collectability of the remaining accounts receivable, the Company should

not have recognized any revenue from this agreement during the year ended December 31, 2021.

As a result of the payment of $ 500,000 received during the year ended December 31, 2021,

the Company is allowed to record deferred revenue in the amount of $ 500,000 .

the Company decreased accounts receivable by $ 4,500,000 , increased deferred revenue by

$ 500,000 and decreased revenue by $ 5,000,000 , for the year ended December 31, 2021.

a result of all the foregoing adjustments, the Company reevaluated the classifications of accounts on the statements of cash flows

(7) On October 28, 2021, the Company granted 3,832,431 restricted stock awards

and as of December 31, 2021 issued 3,448,066 not previously reported on the balance sheet and statement of equity as issued and outstanding.

After reexamination

of funding provided by UCIL, it was determined that payments made by UCIL for deposits toward the acquisition of Nook had not been

recorded by the Company.

Such payments have been recorded as an asset for deposits for acquisition and as an increase to the balance

of the convertible note owed to UCIL.

In connection with completion

of the tax provision for 2023, a transaction which had been recorded in 2021 was reevaluated and a decision was made that it should

not have been recorded and should be reversed.

Specifically, at the end of 2021, a decision was made to increase goodwill related

to the acquisition of Global Gaming Enterprises, Inc.

due to an incorrect conclusion that “an adjustment should be made to

goodwill for the recording of related deferred tax liabilities as the Company released $ 1.6 million of valuation allowance since

the additional deferred tax liabilities represent a future source of taxable income”.

This approach improperly accelerated

the effects of future amortization of intangible assets related to Global Gaming, resulting in inappropriately releasing part of

a valuation allowance for deferred taxes which is not in compliance with GAAP.

At that time, the Company recorded an increase to

goodwill for Global Gaming and an income tax benefit each in the amount of $ 1,653,067 .

We have reversed this transaction by reducing

goodwill for Global Gaming by $ 1,653,067 and have increased accumulated deficit to remove the income tax benefit which was incorrectly

recorded for year ended December 31, 2021.

In connection with a review of UCIL, it was also determined that UCIL had paid the open balance owed to two vendors.

The correction recorded was a decrease to accounts payable and an increase to the loan from UCIL.

Woodford Debt

review of amounts recorded as convertible debt from Woodford during the first half of 2023 a determination was made that certain

amounts had been incorrectly credited to Woodford, and inadvertently recorded as additional operating expenses.

This was corrected

by reducing the balance for convertible debt from Woodford and reducing operating expenses.

The item described in (1)

above resulted in an increase to convertible debt from UCIL by $ 81,464 .

The net effect of these

corrections was an increase in Convertible debt by $ 48,925

In connection with additional review of balance sheet accounts, it was determined that certain items had been over

As a result, we reduced accrued and other expenses.

Further review of funding

amounts received from third parties in the first half of 2023 resulted in certain reclassifications that increased other liabilities.

After the 10-K for the

year ended December 31, 2023 was filed, it was determined that an error had occurred in consolidating results of operations such

that only the fourth quarter of 2023 had been included for Global Gaming and the first through third quarters for Global Gaming were

inadvertently omitted.

It was also determined that there were some issues with calculations and exchange rates and related to non-controlling

These issues were corrected by:

revenue to include the first through third quarters of 2023 for Global Gaming.

Increasing cost of revenue

to include the first through third quarters of 2023 for Global Gaming.

The effect of 7.a.

7.b was a net increase to gross margin

Increasing operating expenses

to include the first through third quarters of 2023 for Global Gaming.

A correction was made to

accumulated and other comprehensive loss in connection with the changes described here in item 7.

A correction was made to

non-controlling interest in connection with the changes described here in item 7.

A correction was made to

foreign currency translation adjustment, net in connection with the changes described here in item 7.

A correction was made to

net income attributable to non-controlling interest in connection with the changes described here in item 7.

connection with completion of the tax provision for the year ended December 31, 2023, it was determined that:

there would be state

taxes owed to Texas in connection with the lottery ticket sales that occurred in April;

there may be taxes owed to other states;

existence of multiple legal entities appears to result in state taxes being owed by more than one entity from a consolidated

As a result, we recorded an estimate of $ 60,000

as an expense for state taxes and as an addition to accrued taxes payable.

Business Combination

5 unchanged sentences

common stock.

Merger closing was a triggering event for the Series B convertible notes, of which $ 63.8

The Merger closing was a

triggering event for the Series B convertible notes, of which $ 63.8

million was converted into 164,426

16 unchanged sentences

parties, and approximately $ 5,593,000 payment of accrued underwriter fees.

to the terms of the Business Combination Agreement, the holders of issued and outstanding shares of AutoLotto immediately prior to the

Closing (the “Sellers”) were entitled to receive up to 6,000,000 additional shares of Common Stock (the “Seller Earnout

Shares”) and Vadim Komissarov, Ilya Ponomarev and Marat Rosenberg (collectively the “TDAC Founders”) were also entitled

to receive up to 4,000,000 additional shares of Common Stock (the “TDAC Founder Earnout Shares” and, together with the Seller

Earnout Shares, the “Earnout Shares”).

One of the earnout criteria had not been met by the December 31, 2021 deadline thus

no earnout shares were granted specific to that criteria.

As of December 31, 2021, 3,000,000 of the Seller Earnout Shares and 2,000,000

TDAC Founder Earnout Shares are still eligible Earnout Shares until December 31, 2022.

to the terms of the Business Combination Agreement, the holders of issued and outstanding shares of AutoLotto immediately prior to

the Closing (the “Sellers”) were entitled to receive up to 300,000

additional shares of Common Stock (the “Seller Earnout Shares”) and Vadim Komissarov, Ilya Ponomarev and Marat Rosenberg

(collectively the “TDAC Founders”) were also entitled to receive up to 200,000

additional shares of Common Stock (the “TDAC Founder Earnout Shares” and, together with the Seller Earnout Shares, the

“Earnout Shares”).

One of the earnout criteria had not been met by the December 31, 2021 deadline thus no earnout shares

were granted specific to that criteria.

of the Seller Earnout Shares and 100,000

TDAC Founder Earnout Shares were still eligible Earnout Shares until December 31, 2022.

Conditions for the earnout were not met and the potential earnout shares were forfeited on December 31, 2022.

Gaming Acquisition

6 unchanged sentences

of chance in other countries throughout Latin America.

Aganar has been operating in the licensed iLottery market in Mexico since 2007

Aganar has been operating in the licensed Lottery market in Mexico since 2007

and is licensed to sell Mexican National Lottery draw games, instant win tickets, and other games of chance online with access to a federally

9 unchanged sentences

acquired intangible assets were determined using Level 3 inputs which were not observable in the market.

total purchase price of $ 10,989,691 , consisting of cash of $ 10,530,000 and 687,439 shares of common stock of AutoLotto at $ 0.67 per share.

The total consideration transferred was approximately $ 10,055,214 , reflecting the purchase price, net of cash on hand at Global Gaming

and the principal amount of certain loans acquired.

The purchase price is for an 80 % ownership interest and is therefore grossed up to

$ 13,215,843 as to reflect the 20 % minority interest in the acquirees.

The purchase price was allocated to the identified tangible and

intangible assets acquired based on their estimated fair values at the acquisition date as follows:

Schedule of Tangible and Intangible Assets Acquisition

total purchase price of $ 10,989,691 ,

consisting of cash of $ 10,530,000

shares of common stock of AutoLotto at $ 0.67

The total consideration transferred was approximately $ 10,055,214 ,

reflecting the purchase price, net of cash on hand at Global Gaming and the principal amount of certain loans acquired.

price is for an

80 % ownership interest and is therefore grossed up to $ 13,215,842

to reflect the 20 %

minority interest in the acquirees.

The purchase price was allocated to the identified tangible and intangible assets acquired based

on their estimated fair values at the acquisition date as follows:

of Identified Tangible and Intangible Asset Acquired

Accounts receivable, net

9 unchanged sentences

Total net assets of Acquirees

recognized in connection with the - is primarily attributed to an anticipated growing lottery market in Mexico that are expected

recognized in connection with the acquisition - is primarily attributed to an anticipated growing lottery market in Mexico that is expected

to be achieved from the integration of these Mexican entities.

1 unchanged sentence

are details of the purchase price allocated to the intangible assets acquired.

Schedule of Intangible Assets Acquired

of Intangible Assets Acquired

Customer relationships

2 unchanged sentences

Total Intangibles

following pro forma condensed consolidated results of operations for the year ended December 31, 2021 have been prepared as if the acquisition

of Global Gaming had occurred on January 1, 2021 and includes adjustments for amortization of intangibles and the addition to basic and

diluted weighted average number of shares outstanding.

Schedule of Business Combination Pro Forma Information

For the year ended December 31, 2021

(As presented

Total revenues

Net income (loss)

( 50,790,472 )

( 50,876,634 )

Net income (loss) attributable to shareholders

$ ( 50,927,396 )

$ ( 51,013,558 )

Net income (loss) per common share

Basic and diluted

Weighted average common shares outstanding

Basic and diluted

Subsequently,

the Company adjusted Goodwill for the recording of related deferred tax liabilities as the Company released $ 1.6 million of valuation

allowance since the additional deferred tax liabilities represent a future source of taxable income.

Property and Equipment, net

and equipment, net as of December 31, 2023 and 2022, consisted of the following:

of Property and equipment net

of Property and Equipment

Computers and equipment

6 unchanged sentences

expense for the years ended December 31, 2023 and 2022 amounted to $ 90,744 and $ 160,466 , respectively.

Prepaid Expenses

expenses consist primarily of advertising credits from two top tier media organizations that operate in the United States.

The advertising

credits were obtained in return for warrants, shares of common stock and shares of preferred stock.

The agreements do not specify a time

period for utilizing these credits and there is no requirement to provide cash or other consideration in connection with utilizing them.

The balance can be utilized at any time at the mutual consent of the parties.

The Company expects to begin utilizing these credits in

the second quarter of 2024 and anticipates fully utilizing all of them by the end of 2024.

Accordingly, they are presented as current

Notes Receivable

March 22, 2022, the Company entered into a three -year secured promissory note agreement with a principal amount of $ 2,000,000 .

bears simple interest at the rate of approximately 3.1 % annually, due upon maturity of the note.

The note is secured by all assets, accounts,

and tangible and intangible property of the borrower and can be prepaid any time prior to its maturity date.

As of September 30, 2023,

the entire $ 2,000,000 in principle was outstanding.

note was received in consideration for a portion of the development work that the Company performed for the borrower who had intended

to use the Company’s technology to launch its own online game in a jurisdiction outside the U.S., where the Company is unlikely

Write-Off of Goodwill and Intangibles

required by ASC 350 Intangibles – Goodwill and Other Impairment and ASC 360 – Impairment Testing:

Long-Lived Assets, in connection

with preparing the consolidated financial statements for the period ended December 31, 2023, management conducted a review as to whether

there are conditions or circumstances that may indicate the impairment of its long-lived assets, goodwill and other indefinite-lived

intangible assets.

Company reviewed the goodwill and intangibles acquired in the acquisitions of TinBu, LLC and Global Gaming Enterprises, Inc., the domain

names and software purchased from third parties, and software developed in-house.

Each of TinBu, Global Gaming, and Lottery.com is considered

a reporting unit for application of the annual review for potential impairment.

company performed a valuation of each of the reporting units described above, using discounted cash flow methodologies and estimates

of fair market value.

Given the results of the quantitative assessment, the company determined that the goodwill for the TinBu and Global

Gaming reporting units was impaired.

For the year ended December 31, 2023, the company recognized goodwill impairment charges of $ 5.65

million for the TinBu reporting unit and $ 1.06 million for the Global Gaming reporting unit.

The total impairment charges related to

goodwill were $ 6.71 million.

In addition, it was determined that there was an impairment of certain intangible assets related to Global

For the year ended December 31, 2023, the Company recorded impairment charges of $ 488 thousand to trade names and trademarks

and $ 312 thousand to technology acquired from Global Gaming.

The total impairment charges to intangible assets were $ 800 thousand.

Additionally,

in connection with completion of the tax provision for

2023, a transaction which had been recorded for the year ended December 31, 2021 was reevaluated and a decision was made that it should

not have been recorded and should be reversed.

Specifically, at the end of 2021, a decision was made to increase goodwill related to

the acquisition of Global Gaming Enterprises, Inc.

due to an incorrect conclusion that “an adjustment should be made to goodwill

for the recording of related deferred tax liabilities as the Company released $ 1.6 million of valuation allowance since the additional

deferred tax liabilities represent a future source of taxable income”.

This approach improperly accelerated the effects of future

amortization of intangible assets related to Global Gaming, resulting in inappropriately releasing part of a valuation allowance for

deferred taxes which is not in compliance with GAAP.

At that time, the Company recorded an increase to goodwill for Global Gaming and

an income tax benefit each in the amount of $ 1,653,067 .

We have reversed this transaction by reducing goodwill for Global Gaming by $ 1,653,067

and have increased accumulated deficit to remove the income tax benefit which was incorrectly recorded for year ended December 31, 2021.

Intangible assets, net

following intangible assets, net relate to the acquisition of TinBu LLC (“TinBu”):

Relationships

relationships represent the valuation of acquired customer accounts.

The cost is amortized on the straight-line method over its estimated

useful life of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the years ended December 31, 2021 and 2020 was $ 156,667 .

Estimated amortization expense for each of the ensuing years through

December 31, 2024 will be $ 156,667 (except for 2024, which will be $ 104,444 ).

name consists of the valuation of the Company’s trademarks and brand identity.

The trade name is being amortized on the straight-line

method over its respective term of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the years ended December 31, 2021 and 2020 was $ 1,667 .

Estimated amortization expense for each of the ensuing years through

December 31, 2024 will be $ 1,667 (except for 2024, which will be $ 1,111 ).

represents the valuation of acquired technology.

The cost is amortized on the straight-line method over its estimated useful life of

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the years ended December 31, 2021 and 2020 was $ 238,333 .

Estimated amortization expense for each of the ensuing years through

December 31, 2024 will be $ 238,333 (except for 2024, which will be $ 158,889 ).

Company entered into a software agreement with a third party.

As part of the agreement, the Company paid $ 2,000,000 for unlimited access

to the software of the third party.

The cost of this software agreement is amortized on the straight-line method over its estimated useful

life of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

( 1,277,777 )

Total Intangibles

expense for the years ended December 31, 2021 and 2020 was $ 333,333 .

Estimated amortization expense for each of the ensuing years through

December 31, 2024 will be $ 333,333 (except for 2024, which will be $ 55,556 ).

March 9, 2018, the Company and Playsino Inc.

executed a Merger Agreement (the “Playsino Agreement”), which included a provision

that, in the event of the Playsino Agreement’s termination, the Company would receive a non-exclusive license to certain programs,

databases and operating systems owned by Playsino, Inc.

without further action required by either the Company or Playsino, Inc.

15, 2021, the Company terminated the majority of the Playsino Agreement, to pursue a business combination with Trident.

The surviving

provision was the non-exclusive license for which the Company issued Playsino, Inc.

a Series B notes in the principal amount to $ 12.45

The Company’s non-exclusive license to certain programs, databases and operating systems became effective as of the date

of the termination of the Playsino Agreement, being February 15, 2021, on which both parties were able to agree on the value for the

non-exclusive license.

The non-exclusive license is treated as an intangible asset under ASC 350 “Intangibles — Goodwill

The useful life of the intangible asset is five years .

The cost of the intangible asset is amortized on the straight-line

method over its estimated useful life.

As of the date of this filing, the Company’s management assessed that were no triggering

events or circumstances that indicated that the asset carrying value would be impaired.

Management will continue to evaluate for impairment

periodically in accordance with ASC 360-10 “Overall — Recoverability of Carrying Amounts — Assets to Be Held and Used”.

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 1,867,500 .

Estimated amortization expense for each of the ensuing years through December

31, 2026 will be $ 2,075,000 (except for 2026, which will be $ 207,500 ).

Domain Acquisition

February 2021, the Company purchased the domain name sports.com.

The total purchase price for the unlimited use of the domain name was

$ 6,000,000 which was partially paid in cash for $ 3,000,000 and the balance was settled by issuing Series B convertible debt of $ 3,000,000

(see Note 7).

The cost is amortized n the straight-line method over its estimated useful life of fifteen years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 333,333 .

Estimated amortization expense for each of the ensuing years through December

31, 2036 will be $ 400,000 (except for 2036, which will be $ 66,667 ).

Domain Acquisition

March 2017, the Company purchased the domain name lottery.com.

The total purchase price was $ 935,000 for the domain name.

amortized on the straight-line method over its estimated useful life of fifteen years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the years ended December 31, 2021 and 2020 was $ 62,333 .

Estimated amortization expense for each of the ensuing years through

December 31, 2032, will be $ 62,333 (except for 2032, which will be $ 15,588 ).

and JuegaLotto Acquisition

following intangible assets, net relate to the acquisition of Aganar and JuegaLotto:

Relationships

relationships represent the valuation of acquired customer accounts.

The asset will be amortized on the straight-line method over its

estimated useful life of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 34,167 .

Estimated amortization expense for each of the ensuing years through December

31, 2027 will be $ 68,333 (except for 2027, which will be $ 34,167 ).

name consists of the valuation of the Company’s trademarks and brand identity.

The trade name is being amortized on the straight-line

method over its respective term of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 211,667 .

Estimated amortization expense for each of the ensuing years through December

31, 2027 will be $ 423,333 (except for 2027, which will be $ 211,667 ).

represents the valuation of acquired technology.

The asset will be amortized on the straight-line method over its estimated useful life

of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 135,000 .

Estimated amortization expense for each of the ensuing years through December

31, 2027 will be $ 270,000 (except for 2027, which will be $ 135,000 ).

licenses represent the valuation of licenses allowing the entities to operate in certain jurisdictions.

The asset will be amortized on

the straight-line method over its estimated useful life of six years .

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 670,000 .

Estimated amortization expense for each of the ensuing years through December

31, 2027 will be $ 670,000 (except for 2027, which will be $ 335,000 ).

Use Software Development

Company has reviewed the software development expenses associated with a variety of software development efforts during the year 2021

and determined that a significant amount of the expense associated with internally developed software should be capitalized under ASC

Company’s identified capitalized software intangible assets are amortized on a straight-line basis over their estimated useful

lives, ranging from 2 to 10 years.

of Intangible Assets Related to Acquisition

accumulated amortization

Total Intangibles

expense for the year ended December 31, 2021 was $ 23,323 .

Estimated amortization expense for years ended December 31, 2022 and December

31, 2023 will be $ 55,976 and $ 32,652 , respectively.

development costs of $ 2,080,099 relate to projects not placed in service as of December 31, 2021, amortization will be calculated using

the straight line method over the appropriate estimated useful life.

Gross carrying values and accumulated amortization of intangible assets:

of Finite Lived Intangible Assets Amortization Expenses

Carrying Amount

Amortizing intangible assets

Customer relationships

Software agreements

Gaming license

Internally developed software

expense with respect to intangible assets for the year ended December 31, 2023 and 2022 totaled $ 5,550,882

and $ 5,440,908 ,

respectively, which is included in depreciation and amortization in the Statements of Operations.

The Company determined that there

was an impairment of long-lived assets of $ 412,450

during the year ended December 31, 2022, which relates to a project no longer being pursued by the Company.

In connection with the annual review of goodwill and intangibles, the Company determined that it was necessary to

write down goodwill by $ 5,650,000 for TinBu and $ 1,060,200 for Global Gaming.

The total impairment charges related to goodwill

were $ 6,710,200 for the year ended December 31, 2023.

It was also determined that there was impairment of certain intangible assets related

to Global Gaming.

As a result, the Company recorded impairment charges of $ 488,300 to trade names and trademarks and $ 311,500 to technology

acquired from Global Gaming.

The total impairment charges to intangible assets for the year ended December 31, 2023 were $ 798,800 .

amortization expense for years of useful life remaining is as follows:

double check future amortization.

of Estimated Amortization Expense

Years ending December 31,

Company had software development costs of $ 476,850 related

to projects not placed in service as of both December 31, 2023 and December 31, 2022, which is included in intangible

assets in the Company’s consolidated balance sheets.

Amortization will be calculated using the straight-line method over the

appropriate estimated useful life when the assets are put into service.

Notes Payable and Convertible Debt

Convertible Note

connection with the Lottery.com domain purchase, the Company issued a secured convertible promissory note (“Secured Convertible

Note”) with a fair value of $ 935,000 that matured in March 2021.

The Company used the fair value of the Secured Convertible Note

to value the debt instrument issued.

In March 2021, the Secured Convertible Note was fully converted into 1,398,221 shares of the Company’s

common stock (see Note 8).

August to October 2017, the Company entered into seven Convertible Promissory Note Agreements with unaffiliated investors for an

aggregate amount of $ 821,500 .

The notes bear interest at 10 %

per year, are unsecured, and were due and payable on June 30, 2019.

The parties have verbally agreed to extend the maturity of the

notes to December

As of December 31, 2021 and December 31, 2020, the balance due on these notes was $ 0

and $ 821,500 ,

respectively.

connection with the Lottery.com domain purchase, the Company issued a secured convertible promissory note (“Secured

Convertible Note”) with a fair value of $ 935,000

that matured in March 2021.

The Company used the fair value of the Secured Convertible Note to value the debt instrument issued.

March 2021, the Secured Convertible Note was fully converted into 69,910

share of the Company’s common stock.

August to October 2017, the Company entered into seven Convertible Promissory Note Agreements with unaffiliated investors for an aggregate

amount of $ 821,500 .

The notes bear interest at 10 % per year, are unsecured, and were due and payable on June 30, 2019.

The parties verbally

agreed to extend the maturity of the notes to December 31, 2021 .

As of both December 31, 2023 and December 31, 2022, the balance due

on these notes was $ 771,500 .

The Company cannot prepay the loan without consent from the noteholders.

As of December 31, 2021, there have been no

Qualified Financing events, that trigger conversion, this included the TDAC combination.

As of December 31, 2021, there

were no Qualified Financing events, that trigger conversion, this included the TDAC combination.

As of December 31, 2022, the remaining

outstanding balance of $ 771,500

relates to notes that are no longer convertible and have been reclassified to Notes Payable as per the agreement.

Accrued interest

on the note payable was $ 138,822

at December 31, 2021.

outstanding balance of $ 771,500 relates to notes that are no longer convertible which have been reclassified to Notes Payable as per

the agreement.

Accrued interest on the Series A notes payable was $ 318,909 on December 31, 2023.

November 2018 to December 2020, the Company entered into multiple Convertible Promissory Note agreements with unaffiliated investors

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February 2021 to extend the maturity of the notes to December 21, 2021 .

The Company cannot prepay the loan without consent from the noteholders.

the year ended December 31, 2021, the Company entered into multiple Convertible Promissory Note agreements with unaffiliated

investors for an aggregate amount of $ 38,893,733 .

The Company cannot prepay the loans without consent from the

the year ended December 31, 2021, the Company entered into multiple Convertible Promissory Note agreements with unaffiliated investors

for an aggregate amount of $ 38,893,733 .

The notes bear interest at 8 %

per year, are unsecured, and are due and payable on dates ranging from December 2021 to December 2022.

The Company cannot prepay

these loans without consent from the noteholders.

The Company cannot prepay these

loans without consent from the noteholders.

As of December 31, 2021, the Series B Convertible Notes had a balance of $ 0 .

The Company also issued additional convertible promissory notes with unaffiliated investors for an aggregate amount of $ 10,000,000 which

bear interest at 6 %

per year, are unsecured and are due in May 2023.

the year ended December 31, 2021, the Company entered into amendments with six of the Series B promissory noteholders to increase the

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The Company recorded

loss on extinguishment of $ 71,812 as a result of the amendment which is mapped in “Other expenses” on the consolidated statements

loss on extinguishment of $ 71,812 as a result of the amendment which was mapped in “Other expenses” on the consolidated statements

of operations and comprehensive loss.

of October 29, 2021, all except $ 185,095

of the series B convertible notes were converted into 9,764,511

shares of Lottery.com common stock.

As of December 31, 2021, the remaining notes comprising the outstanding balance of $ 185,095

are no longer convertible and have been reclassified to notes payable.

See Note 4 Accrued interest on this note payable as of

December 31, 2021 was $ 35,184 .

of December 31, 2021 and 2020, the outstanding balances of the Series A and B notes was as follows;

of the outstanding balances of the Series A and B notes

Total face value of series A convertible notes payable

Total face value of series B convertible notes payable

Total face value of secured convertible promissory note

Total face value of convertible notes payable

unamortized beneficial conversion feature

( 1,240,716 )

unamortized debt discount

Total convertible notes payable, net

current portion of convertible notes payable

( 8,882,665 )

Convertible notes payable, net of current portion

May 1, 2020, the Company entered into a Promissory Note with Cross River Bank, which provides for a loan in the aggregate amount of $493,225,

of October 29, 2021, all except $ 185,095 of the series B convertible notes were converted into 488,226 shares

of Lottery.com common stock after accounting for the 20:1 reverse stock split that took place on August 9, 2023.

As of December 31, 2023, the remaining notes comprising

the outstanding balance of $ 185,095 are no longer convertible and have been reclassified to notes payable.

Accrued interest

on this note payable as of December 31, 2023 and 2022 was $ 64,799 and $ 49,992 , respectively.

May 1, 2020, the Company entered into a Promissory Note with Cross River Bank, which provided for a loan in the aggregate amount of $493,225,

pursuant to the Paycheck Protection Program, (“PPP”).

The PPP, established under Division A, Title I of the Coronavirus Aid,

Relief and Economic Security Act (“CARES Act”) enacted on March 27, 2020, provides for loans to qualifying businesses for

Relief and Economic Security Act (“CARES Act”) enacted on March 27, 2020, provided for loans to qualifying businesses for

amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business.

The loans and accrued interest are forgivable

after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities

(“Qualified Expenses”), and maintains its payroll levels.

The loans and accrued interest were forgivable

after eight weeks as long as the borrower utilized the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities

(“Qualified Expenses”), and maintained its payroll levels.

On August 24, 2021, the PPP loan and accrued interest was forgiven

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The Company recorded the full amount related to the forgiveness

of the PPP loan as a gain on extinguishment of debt during our third quarter of fiscal year 2021 .

of the PPP loan as a gain on extinguishment of debt during the third quarter of fiscal year 2021.

June 29, 2020, the Company entered into a Promissory Note with the U.S.

Small Business Administration (“SBA”) for $ 150,000 .

The loan has a thirty -year

term and bears interest at a rate of 3.75 %

The loan has a thirty-year term and bears interest at a rate of 3.75 %

Monthly principal and interest payments are deferred for twelve months after the date of disbursement.

The loan may be prepaid

at any time prior to maturity with no prepayment penalties.

The Promissory Note contains events of default and other provisions customary

for a loan of this type.

The loan may be

prepaid at any time prior to maturity with no prepayment penalties.

The Promissory Note contains events of default and other

provisions customary for a loan of this type.

As of December 31, 2023 and 2022, the balance of the loan was $ 150,000 .

respectively.

As of December 31, 2021, the accrued interest on this note was $ 2,255 .

As of December 31, 2023 and December 31, 2022, the accrued interest on this note was $ 5,253

and $ 3,764 respectively.

August 2020, the Company entered into three separate note payable agreements with three individuals for an aggregate amount of $ 37,199 .

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financing event.

As of December 30, 2021 and 2020, the balance of the loans totaled $ 13,000 and 17,700 , respectively.

As of December 30, 2023 and 2022, the balance of the loans totaled $ 13,000 , respectively.

August 28, 2018, in connection with the purchase of the entire membership interest of TinBu, the Company entered into several notes payable

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maturity date of January 25, 2022.

The notes payable were modified during 2021 to extend the maturity to June 30, 2022 and modified the

The notes payable were modified during 2021 to extend the maturity to June 30, 2022 and change the

interest rate to include simple interest of 4.1 % per annum effective October 1, 2021.

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to be loan modifications and accounted for accordingly.

of December 30, 2021 and December 31, 2020, the balance of the notes was $ 2,628,234 and $ 11,067,643 , respectively.

of both December 30, 2023 and December 31, 2022, the balance of the notes was $ 2,601,370 .

Accrued interest on these notes was $ 242,381 on December 31, 2023 and $ 164,846 on December 31, 2022, respectively.

Stockholders’ Equity

and Common Stock

Reverse Split

On August 9, 2023, the Company amended

its Charter to implement, effective at 5:30 p.m., Eastern time, a 1-for-20 Reverse Stock Split.

At the effective time of the Reverse Stock

Split, every 20 shares of common stock either issued and outstanding or held as treasury stock were automatically combined into one issued

and outstanding share of common stock, without any change in the par value per share .

Stockholders who would have otherwise been entitled

to fractional shares of common stock as a result of the Reverse Stock Split received a cash payment in lieu of receiving fractional shares.

In addition, as a result of the Reverse Stock Split, proportionate adjustments will be made to the number of shares of common stock underlying

the Company’s outstanding equity awards, the number of shares issuable upon the exercise of the Company’s outstanding warrants

and the number of shares issuable under the Company’s equity incentive plans and certain existing agreements, as well as the exercise,

grant and acquisition prices of such equity awards and warrants, as applicable.

The Reverse Stock Split was approved by the Company’s

stockholders at the Company’s 2023 Annual Meeting of Stockholders on August 7, 2023 and was subsequently approved by the Board of

Directors on August 7, 2023.

The effects of the Reverse

Stock Split were reflected in the Quarterly Report on Form 10-Q for the period ended September 30, 2023 and in all subsequent

reports for all periods presented.

to the Company’s charter, the Company is authorized to issue 1,000,000 shares of preferred stock, par value $ 0.001 per share.

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Unless our Board determines otherwise, we will issue all shares

of our common stock in uncertificated form.

Holders of our Common Stock are entitled to one vote for each share held of record on all

matters submitted to a vote of stockholders.

The holders of Common Stock do not have cumulative voting rights in the election of directors.

Upon our liquidation, dissolution or winding up and after payment in full of all amounts required to be paid to creditors and to the

holders of preferred stock having liquidation preferences, if any, the holders of our Common Stock will be entitled to receive pro rata

our remaining assets available for distribution.

of December 31, 2021 and December 31, 2020, 50,256,317 shares and 22,658,006 shares, respectively, were outstanding.

During the year

ended December 31, 2021, the Company issued the following shares of common stock.

Schedule of Common Stock

Issuance of Common Stock in Reverse Merger (Note 4)

Issuance of Common Stock in Global Gaming Acquisition (Note 4)

of our common stock in an uncertificated form.

Holders of our Common Stock are entitled to one vote for each share held of record on

all matters submitted to a vote of stockholders .

The holders of Common Stock do not have cumulative voting rights in the election of

Upon our liquidation, dissolution or winding up and after payment in full of all amounts required to be paid to creditors

and to the holders of preferred stock having liquidation preferences, if any, the holders of our Common Stock will be entitled to receive

pro rata our remaining assets available for distribution.

of December 31, 2023 and December 31, 2022, 2,877,045

and 2 , 52 7 ,045

shares of Common Stock, post reverse stock split, respectively, were outstanding.

During the year ended December 31, 2022, the

Company issued the following shares of common stock.

No similar issuances occurred in 2023.

of Common Stock

As of December 31, 2021

Issuance of Common Stock for legal settlement

Exercise of options (Note 11)

Exercise of warrants (See below)

Conversion of convertible debt (Note 7)

Public Warrants became exercisable 30 days after the Closing as the Company has an effective registration statement under the Securities

Restricted stock award

As of December 31, 2022

Issuance of common stock

As of December 31, 2023

Public Warrants became exercisable 30 days after the Closing;

the Company has an effective registration statement under the Securities

Act covering the shares of common stock issuable upon exercise of the Public Warrants and a current prospectus relating to them is available

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settled by the Company in any event.

of December 31, 2021, there were 20,125,000 Public Warrants outstanding.

Immediately after giving effect to the Business Combination,

there were 20,125,002 warrants to purchase share of Common stock outstanding, 20,125,000 of which are public warrants and two of which

were previously warrants of AutoLotto, which are now warrants of Lottery.com and are exercisable to purchase an aggregate of 395,675

shares of common stock.

After giving effect to the

Business Combination, as of December 31, 2023 there were Public Warrants outstanding for the issuance of 1,006,250 shares

of common stock of the Company, which total includes previously issued warrants of AutoLotto, now warrants of Lottery.com Inc.,

which are exercisable for the purchase of an aggregate of 19,784 shares

of common stock of the Company.

warrants of TDAC issued before the business combination were forfeited and did not transfer to the surviving entity.

Purchase Option

June 1, 2018, the Company sold to the underwriter (and its designees), for $ 100 , an option to purchase up to a total of 1,750,000 Units

exercisable at $ 12.00 per Unit (or an aggregate exercise price of $ 21,000,000 ) commencing on the consummation of the Business Combination.

The 1,750,000 Units represents the right to purchase 1,750,000 shares of common stock and 1,750,000 warrants to purchase 1,750,000 shares

of common stock.

The unit purchase option may be exercised for cash or on a cashless basis, at the holder’s option, and expires

on May 29, 2023 .

The Units issuable upon exercise of this option are identical to those offered by Lottery.com.

The Company accounted

for the unit purchase option, inclusive of the receipt of $ 100 cash payment, as an expense of the Business Combination resulting in a

charge directly to stockholders’ equity.

As of December 31, 2021 all of the 1,750,000 Units are vested, exercisable and outstanding.

June 1, 2018, the Company sold to the underwriter (and its designees), for $ 100 ,

an option to purchase up to a total of 87,500

Units exercisable at $ 240.00

per Unit (or an aggregate exercise price of $ 21,000,000 )

commencing on the consummation of the Business Combination.

Units represents the right to purchase 87,500

shares of common stock and 87,500

warrants to purchase 87,500

shares of common stock.

The unit purchase option, which was exercisable for cash or on a cashless basis, at the holder’s

option, expired on May 29, 2023.

The Units issuable upon exercise of this option were identical to those offered by Lottery.com.

Company accounted for the unit purchase option, inclusive of the receipt of $ 100

cash payment, as an expense of the Business Combination resulting in a charge directly to stockholders’ equity.

As of December

31, 2023 all of the 87,500

Units have been forfeit.

Stock Warrants

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31, 2023 and 2022.

Schedule of Common Stock Warrant

Number of Shares

of Common Stock Warrant

Outstanding at December 31, 2021

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Outstanding at December 31, 2023

Exercisable at December 31, 2021

Conversion Feature - Convertible Debt

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The Company recognized the

proceeds allocable to the beneficial conversion feature of $ 8,480,697 as additional paid in capital and a corresponding debt discount

of $ 2,795,000 .

proceeds allocable to the beneficial conversion feature of $ 8,480,697

as additional paid in capital and a corresponding

debt discount of $ 2,795,000 .

This additional paid in capital is reflected in the accompanying consolidated Statements of Equity.

detailed in Note 4 – as part of the TDAC Combination as of December 31, 2021 a total of 5,000,000 Earnout Shares are eligible for

issuance until December 31, 2022.

Stock-based Compensation Expense

Stock Option Plan

detailed in Note 4 - as part of the TDAC Combination as of December 31, 2021 a total of 5,000,000

Earnout Shares were eligible for issuance until December 31, 2022.

Conditions for the earnout were not met and the potential earnout

shares were forfeited on December 31, 2022.

Stock-based Compensation

Expense 2015 Stock Option Plan

to the closing of the Business Combination, AutoLotto had the AutoLotto, Inc.

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The maximum number of shares of

Common Stock which may be issued over the term of the Plan shall not exceed Four Hundred Fifty Thousand (450,000).

Common Stock which may be issued over the term of the Plan shall not exceed Twenty-Two Thousand Five Hundred (22,500).

Options are exercisable

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As of December 31, 2023, the Company has not granted awards under the 2021 Plan.

Equity Incentive Plan

October 10, 2023, the Board adopted the Lottery.com 2023 Employees’ Directors’ and Consultants Stock Issuance and Option

Plan (the “2023 Plan”) under which 500,000 shares of Class A common stock were initially reserved for issuance.

Plan allows for the issuance of incentive and non-qualified stock options, and restricted stock.

As of December 31, 2023, the Company

had awarded 350,000 shares under the 2023 Plan.

Company did not issue any new stock options during the years ended December 31, 2023 and 2022.

2 unchanged sentences

of Stock Option Activity

Balance, December 31, 2019

Forfeited/cancelled

Balance, December 31, 2020

Outstanding at December 31, 2021

Forfeited/cancelled

Balance, December 31, 2021

Exercisable, December 31, 2021

compensation expense related to the employee options was $ 10,077 and $ 9,417 for the year ended December 31, 2021, and 2020 respectively.

compensation expense related to the non-employee options was $ 0 and $ 6,682 for year ended December 31, 2021 and 2020, respectively.

income tax benefit has been recognized related to the stock-based compensation expense, and no tax benefits have been realized from the

exercised stock options.

As of December 31, 2021, unrecognized stock-based compensation associated with stock options amounted to $ 0 .

Outstanding at December 31, 2022

Forfeited/cancelled (uncancelled)

Outstanding at December 31, 2023

compensation expense related to the employee options was $ 0 for the year ended December 31, 2023, and 2022.

Company awarded restricted stock to employees on October 28, 2021, which were granted with various vesting terms including immediate

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awards, the Company recognizes the expense when management believes it is probable the performance condition will be achieved.

December 31, 2021, the Company had granted 3,832,431 shares with vesting to begin April 2022.

For the year ended December 31, 2021, the

Company recognized $ 14,483,056 of stock compensation expense related to the employee restricted stock grants.

As of December 31, 2021,

unrecognized stock-based compensation associated with the restricted stock awards is $ 41,006,168 which will be expensed over the next

December 31, 2021, the Company had granted 191,622

shares with vesting to begin April 2022.

the year ended December 31, 2022, the Company recognized $ 27,137,991

of stock compensation expense related to the

employee restricted stock grants.

As of December 31, 2023, unrecognized stock-based compensation associated with the restricted stock

awards is $ 0 .

Company had restricted stock activity summarized as follows:

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Restricted shares unvested at December 31, 2022

Outstanding at December 31, 2022

Forfeited/cancelled

Restricted shares unvested at December 31, 2023

Loss Per Share

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of Basic and Diluted Net Income Loss Per Share

Years Ended December 31,

Comprehensive net loss attributable to stockholders

ended December 31, 2022

Comprehensive

net loss attributable to stockholders

$ ( 25,537,315 )

$ ( 59,999,072 )

Weighted average common shares outstanding

Basic and diluted

Weighted average common shares

Net loss per common share

Basic and diluted

of December 31, 2021, the Company excluded 345,661 stock options, 2,012,774 convertible debt into common shares, 3,832,431 of restricted

awards, 3,869,305 of warrants, 1,726,027 of earn out shares and 604,110 of unit purchase options from the calculation of diluted net

of December 31, 2023, the Company excluded 10,456 stock options, 23,417 restricted awards, 24,415 warrants, 250,000 earn

out shares and 87,500 unit purchase options from the calculation of diluted net loss per share with the effect being anti-dilutive.

of December 31, 2023, the Company excluded 17,283 stock options, 100,639 convertible debt into common shares, 191,622 restricted

awards, 193,465 warrants, 86,301 earn out shares and 30,206 unit purchase options from the calculation of diluted net

loss per share with the effect being anti-dilutive.

of December 31, 2020, the Company excluded 1,315,218 stock options and 537,359 warrants from the computation of diluted net loss per

share since the intrinsic value of these instruments was zero with the effect being anti-dilutive.

Company’s pre-tax income (loss) by jurisdiction was as follows for the years ending December 31, 2023 and December 31, 2022:

of Pre-tax Income (Loss) by Jurisdiction

December 31, 2021

December 31, 2020

Year ended December 31, 2022

$ ( 25,683,200 )

2 unchanged sentences

( 25,679,655 )

( 15,425,578 )

provision for income taxes for continuing operations for the year ended December 31, 2023 and 2022 consist of the following

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Continuing Operations

December 31, 2021

December 31, 2020

Year ended December 31, 2022

Current Income Taxes

1 unchanged sentence

Deferred Income Taxes

( 1,757,535 )

Total deferred income taxes

( 1,653,067 )

Valuation allowance

Total Income Tax Expense (benefit)

( 1,664,335 )

reconciliation between the amount of reported income tax expense (benefit) and the amount computed by multiplying income from continuing

2 unchanged sentences

31, 2023 includes state minimum taxes, permanent differences, and deferred tax assets for which a full valuation allowance has been placed.

A corresponding tax expense is included for the year ended December 31, 2021 to reflect the increase in the valuation allowance.

of Increase in the Valuation Allowance

December 31, 2021

December 31, 2020

Year ended December 31, 2022

Tax Expense at statutory federal rate of 21 %

4 unchanged sentences

Permanent Differences

Other – Miscellaneous

Other - Misc.

Change in Valuation Allowance

Income tax expense (benefit)

$ ( 1,664,335 )

income taxes reflect the tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting

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Federal Net Operating Loss Carryforwards

Intangible Assets

Accrued Compensation & Benefits

Foreign Net Operating Loss Carryforwards

Stock Compensation

Intangible assets

State Net Operating Loss Carryforwards

Total deferred tax assets before valuation allowance

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Net deferred tax assets and liabilities

to the Global Gaming acquisition and the recording of related deferred tax liabilities, the Company released approximately $ 1,600,000

of valuation allowance since the additional deferred tax liabilities represent a future source of taxable income.

For the year ended

December 31, 2021, the valuation allowance increased by approximately $ 7,852,000 .

the year ended December 31, 2023, the valuation allowance increased by $ 10,265,807 .

The Company believes a full valuation allowance against

2 unchanged sentences

in future years.

December 31, 2021, our carryforwards available to offset future taxable income consisted of federal net operating loss

(“NOL”) carryforwards of approximately $ 91,739,683 ,

$ 27,018,316 of

which expires between 2036 and 2037 and $ 64,721,367 of

which has no expiration date.

December 31, 2023, our carryforwards available to offset future taxable income consisted of federal net operating loss (“NOL”)

carryforwards of approximately $ 173,229,125 .

Of this total $ 22,050149 expires between 2035 and 2037 and $ 151,178,976 of which has no

expiration date.

account for uncertain tax positions in accordance with ASC 740-10-25, which prescribes a comprehensive model for the financial statement

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practice is to recognize interest and penalties related to income tax matters in income tax expense in our consolidated statements of

We did not have any interest or penalties on unrecognized tax benefits accrued at December 31, 2021.

The Company files U.S.

federal and state

Company files U.S.

federal and state returns.

The Company’s foreign subsidiary also files a local tax return in their local jurisdiction.

federal, state

and Mexican perspective the years that remain open to examination are consistent with each jurisdiction’s statute of limitations.

The Company has not filed its 2021 and 2022 for U.S.

federal, state and Mexican perspective the years that remain open to examination are consistent with each jurisdiction’s

statute of limitations.

The Company has not filed its 2021, 2022 and 2023 U.S.

federal and state corporate income tax returns.

The Company’s foreign subsidiary

in Mexico is current with the filing of its tax returns through 2022.

The Company expects to file these documents as soon as possible.

While the Company is in a net loss position and expects no income tax amounts to be due except for minimum state and local income taxes,

the Company is at risk for failure to file.

As of the date of this Amended Report, the Company has not been informed that such penalties

have been assessed, therefore no accrual for such has been recorded in the Company’s financial statements.

The Company’s federal

income tax returns for the years 2017-2022 remain subject to examination by the Internal Revenue Service.

Commitments and Contingencies

Indemnification

The Company’s

foreign subsidiary in Mexico is current with the filing of its tax returns through 2022.

The Company expects to file these documents

as soon as possible.

While the Company is in a net loss position and expects no income tax amounts to be due except for minimum state

and local income taxes, the Company is at risk of penalties for failure to file.

As of the date of this Amended Report, the Company has

not been informed that such penalties have been assessed, therefore no accrual for such has been recorded in the Company’s financial

The Company’s federal income tax returns for the years 2020-2023 remain subject to examination by the Internal Revenue

The state returns for 2019-2023 are also open for exam.

and Contingencies

Indemnification Agreements

Company enters into indemnification provisions under its agreements with other entities in its ordinary course of business, typically

11 unchanged sentences

2023 and 2022.

2018, the Company commenced a sale offering and issuance (the “LDC Offering”) of 285 million revenue participation interests

(the “Digital Securities”) of the net raffle revenue of LDC Crypto Universal Public Company Limited (“LDC”).

The Digital Securities do not have any voting rights, redemption rights, or liquidation rights, nor are they tied in any way to other

equity securities of LDC or the Company nor do they otherwise hold any rights that a holder of equity securities of LDC or the Company

may have or that a holder of traditional equity securities or capital stock may have.

Rather, each of the holders of the Digital Securities

has a pro rata right to receive 7 % of the net raffle revenue.

If the net raffle revenue is zero for a given period, holders of the Digital

Securities are not eligible to receive any cash distributions from any raffle sweepstakes of LDC for such period.

For the year ended

December 31, 2021, the Company incurred an obligation to pay an aggregate amount of approximately $ 5,632 to holders of the outstanding

Digital Securities.

The Company did not satisfy any of those obligations during the year ended December 31, 2021.

For year ended December

31, 2020, the Company incurred obligations and paid $ 17,937 , respectively, to holders of the outstanding Digital Securities.

Company leases office space in Spicewood, Texas which expires January 21, 2022.

For the year ended December 31, 2021 and 2020, the Company’s

total rent expense was approximately $ 206,471 and $ 49,202 , respectively.

of December 31, 2021, future minimum rent payments due under non-cancellable leases with initial maturities greater than one year are

2018, the Company commenced a sale offering and issuance (the “LDC Offering”) of 285

million revenue participation interests (the “Digital Securities”) of the net raffle revenue of LDC Crypto Universal

Public Company Limited (“LDC”).

The Digital Securities do not have any voting rights, redemption rights, or liquidation

rights, nor are they tied in any way to other equity securities of LDC or the Company nor do they otherwise hold any rights that a

holder of equity securities of LDC or the Company may have or that a holder of traditional equity securities or capital stock may

Rather, each of the holders of the Digital Securities has a pro rata right to receive 7 %

of the net raffle revenue.

If the net raffle revenue is zero for a given period, holders of the Digital Securities are not eligible

to receive any cash distributions from any raffle sweepstakes of LDC for such period.

For the years ended December 31, 2023 and December 31, 2022, the

company did not incur any obligations to the holders of the outstanding Digital Securities.

For the year ended December 31, 2021,

the Company incurred an obligation to pay an aggregate amount of approximately $ 5,632

to holders of the outstanding Digital Securities.

The Company did not satisfy any of those obligations during the years ended

December 31, 2021, 2022, or 2023.

The Company leased office space in Spicewood, Texas which expired January 31, 2024 and has continued to utilize that

facility on a month to month basis with monthly rent of $ 1,669 per month.

Additionally, the Company has leased retail space in Waco , TX which expires on December 31, 2024 with

monthly rent of $ 2,434 .

For the year ended December 31, 2023, the Company’s total rent expense was approximately $ 61,960 .

of December 31, 2023, future minimum rent payments due under non-cancellable leases with initial are as follows:

of Future Minimum Rent Payments Due Under Non-Cancellable Leases

6 unchanged sentences

of its size and scope.

See Note 15 for additional information.

See Part II, Item 1 for additional information.

Related Party Transactions

5 unchanged sentences

flow for the Company.

The Company paid $ 4,700 during the year and has an outstanding balance of $ 13,000 .

The Company paid $ 4,700 during 2021 and the outstanding balance was $ 13,000 on December 31, 2023 and December 31,

the years ended December 31, 2021 and 2020, the Company entered into a services agreement with Master Goblin Games, LLC (“Master

Goblin Games”), an entity owned by Ryan Dickinson, a former officer of the Company, to facilitate the establishment of receipt of retail lottery licenses

in certain jurisdictions.

Goblin Games”), an entity owned by Ryan Dickinson, a former officer of the Company, to facilitate the establishment of receipt

of retail lottery licenses in certain jurisdictions.

As of December 31, 2023, the Company had no outstanding related party payables.

to the Service Agreement, Master Goblin is authorized and approved by the Company to incur up to $ 100,000 in initial expenses per location

to the Service Agreement, Master Goblin was authorized and approved by the Company to incur up to $ 100,000 in initial expenses per location

for the commencement of operations at each location, including, without limitation, tenant improvements, furniture, inventory, fixtures

1 unchanged sentence

Similarly, pursuant to the Service Agreement, during each

month of operation, Master Goblin is authorized to submit to the Company for reimbursement on-going expenses of up to $ 5,000 per location

month of operation, Master Goblin was authorized to submit to the Company for reimbursement on-going expenses of up to $ 5,000 per location

for actually incurred lease expenses.

The initial expenses are submitted by Master Goblin to the Company upon Master Goblin securing

a lease and leases are only secured by Master Goblin in any location upon request of the Company.

Such initial expenses are recorded

The initial expenses were submitted by Master Goblin to the Company upon Master Goblin securing

a lease and leases were only secured by Master Goblin in any location upon request of the Company.

Such initial expenses were recorded

by the Company as lease obligations.

On-going expenses are submitted by Master Goblin to the Company on a monthly basis, subject to offset,

and are recorded by the Company as an expense.

To the extent Master Goblin has a positive net income in any month, exclusive of the sale

of lottery games, such net income reduces or eliminates such reimbursable expenses for that month.

In January 2023, Woodford Eurasia Assets,

On-going expenses were submitted by Master Goblin to the Company on a monthly basis, subject to

offset, and were recorded by the Company as an expense.

To the extent Master Goblin had a positive net income in any month, exclusive

of the sale of lottery games, such net income reduced or eliminated such reimbursable expenses for that month.

January 2023, Woodford Eurasia Assets, Ltd.

signed a letter of intent to acquire Master Goblin.

Such letter of intent would give Woodford the right to appoint a director to

the Board of Directors of the Company (see Subsequent Events).

As of the date of this Amended Report, no definitive documentation for

this transaction has been signed.

Revenue Disaggregation

disaggregation consists of the following:

of Revenue Disaggregation

Such letter of intent would give Woodford

the right to appoint a director to the Board of Directors of the Company (see Subsequent Events).

As of the date of this Amended Report, no definitive

documentation for this transaction has been signed.

The Company paid Master Goblin an aggregate of approximately $ 53,000 and

$ 440,000 , including expense reimbursements under the Service Agreement and additional reimbursable expenses, during the years ended December

31, 2023 and 2022, respectively.

In January of 2023, the company paid $ 53,000 to Master Goblin Games for settlement of outstanding obligations

of $ 316,919 and the parties mutually agreed to terminate the business relationship.

Subsequent Events

July 1, 2022, Harry Dhaliwal was named as the Company’s Interim Chief Financial Officer and principal financial officer.

entered into a consulting agreement with Mr.

Dhaliwal on July 1, 2022 (the “Consulting Agreement”).

The Consulting Agreement

provided for Mr.

Dhaliwal to serve as Interim Chief Financial Officer of the Company for six months, commencing on July 1, 2022 and terminating

on December 31, 2022.

Dhaliwal’s consulting services could be terminated earlier than December 31, 2022 (i) upon Mr.

resignation or death or (ii) by either the Company or Mr.

Dhaliwal without cause or reason upon written notice to the other party 15

days prior to the termination date of the Consulting Agreement.

Dhaliwal agreed to among other things, assist the Company with its

financial systems, develop a financial dashboard for the Board of Directors and Senior Management and carry out a comprehensive review

of the Company’s finance function.

The Consulting Agreement included customer and employee non-solicitation provisions as well

as confidentiality obligations.

Pursuant to the Consulting Agreement, Mr.

Dhaliwal was to be paid a total of $ 209,550 based on completion

of tasks and to have the opportunity to receive a discretionary bonus in the amount of $ 50,000 .

On October 9, 2022, Mr.

Dhaliwal, resigned

as the Interim Chief Financial Officer and principal financial officer of the Company with immediate effect.

On July 21, 2022, Lawrence Anthony “Tony” DiMatteo III, the then Chief Executive Officer of the Company and a member of its Board of Directors, provided a notice of resignation as CEO of the Company, its wholly-owned subsidiary, AutoLotto, and all of its other subsidiaries and affiliates with the exception of LTRY WinTogether, Inc., with immediate effect.

In connection with Mr.

DiMatteo’s resignation, the Company entered into a resignation and release agreement with Mr.

DiMatteo effective July 22, 2022 (the “Release Agreement”).

Pursuant to the Release Agreement, Mr.

DiMatteo resigned as CEO of the Company effective July 22, 2022.

Following Mr.

DiMatteo’s resignation, he agreed to serve as Senior Advisor to the Board commencing on July 22, 2022 and continuing until the either party gives not less than ten (10) days’ prior notice to the other party (the “Consulting Period”) unless certain conditions for earlier termination become applicable.

DiMatteo agreed to, among other things, (i) provide consulting and advisory services to the Board of Directors of the Company as requested and (ii) cooperate in any ongoing and any future investigation by or related to the Company.

Non-compete and customer and employee non-solicitation provisions as well as confidentiality obligations from prior agreements entered into between Mr.

DiMatteo and the Company will apply while he consults and for a period of one year thereafter.

DiMatteo may be paid $ 1,000 per month for each month during which he provides services to the Company, and reimbursed for business expenses validly incurred prior to his resignation.

The Agreement includes a general release of claims by Mr.

On July 28, 2022, the Board determined that the Company did not currently

have sufficient financial resources to fund its operations or pay certain existing obligations, including its payroll and related obligations

and ceased its operations.

Accordingly, the Company furloughed certain employees effective July 29, 2022.

As of March 31, 2023, the Company

owed approximately $ 1.4 million in outstanding payroll obligations.

On July 29, 2022, the Company filed its

original Verified Complaint for Breach of Contract and Specific Performance (the “Streicher Complaint”) against J.

Financial, LLC (“Streicher”) in the Court of Chancery of the State of Delaware (the “Chancery Court”), styled

AutoLotto, Inc.

dba Lottery.com v.

Streicher Financial, LLC (Case No.

2022-0661-MTZ).

In the Streicher Complaint, the Company alleged

that Streicher breached the contract entered into by the parties on March 9, 2022 and demanded that Streicher return $16,500,000.00 it

owed to the Company.

On September 26, 2022, the Chancery Court entered an order in favor of the Company, Granting with Modifications Company’s

Motion for Partial Summary Judgment in the amount of $16,500,000.00 (the “Streicher Judgment”).

On October 27, 2022, the Chancery

Court further awarded the Company $397,036.94 in attorney’s fees (the “Fee Order”).

On November 15, 2022, the Company

initiated efforts against Streicher to seek collections on the Judgment.

On December 8, 2022, the Company’s prior attorney Skadden,

Arps, Slate, Meagher & Flom, LLP (“Skadden”) filed its Combined Motion to Withdraw as Counsel and For a Charging Lien

in amount of $3,024,201.17 for legal fees unpaid by Company (“Skadden’s Motion”).

On December 30, 2022, the Company

filed its response to Skadden’s Motion, alleging that the Chancery Court should deny Skadden’s Motion for a Charging Lien

as a matter of law or, in the alternative, limit the charging lien to the amount of the attorneys’ fees awarded by the Fee Order.

As of the date of this Amended Report, the Chancery Court has not set Skadden’s Motion for an oral hearing, nor has it entered an

order on the motion.

On January 20, 2023, faced with post-judgment discovery and depositions, Streicher remitted a partial payment towards

the Judgment in the amount of $ 75,000.00 .

On February 13, 2023, Streicher made another payment towards the Judgment in the amount of $ 50,000.00

and had agreed to make another payment in the amount of $ 75,000.00 on February 28, 2023, which it failed to make.

The Company intends

to fully collect on the Judgment and shall pursue all legal and equitable means to enforce the Judgment against Streicher until the Judgment

is fully satisfied.

See “Item 1A.

Risk Factors – Legal Proceedings Risks – We may not recover amounts owed to us from

Streicher Financial, LLC” for further information.

On August 19, 2022, Preston Million filed

the Class Action Complaint (the “Class Action Complaint”) against the Company and certain former officers and directors of

the Company in the United States District Court for Southern District of New York (the “SDNY”), styled Preston Million, Individually

and on Behalf of All Others Similarly Situated vs.

Lottery.com, Inc.

f/k/a Trident Acquisitions Corp., Anthony DiMatteo, Matthew Clemenson

and Ryan Dickinson (Case No.

1:22-cv-07111-JLR).

The Class Action Complaint alleged violations by all defendants of Sections 10(b) and

20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) 15 U.S.C.

§§ 78j(b), 78t(a), as amended by the

Private Securities Litigation Reform Act of 1995 (“PSLRA”), U.S.C.

§ 78u-4 et seq.

(collectively “Federal Securities

On November 18, 2022, the SNDY ordered the appointment of RTD Bros, LLC, Todd Benn, Tom Benn and Tomasz Rzedian (collectively

“Lottery Investor Group”) as lead plaintiff and Glancy Prongay & Murray, LLP as lead counsel for plaintiffs and for the

class in the case.

On December 5, 2022, the Court stipulated a Scheduling Order in the case.

On January 12, 2023, the Company’s

legal counsel timely filed its Notice of Appearance.

On January 31, 2022, plaintiffs filed their Amended Complaint adding Kathryn Lever,

Marat Rosenberg, Vadim Komissarov, Thomas Gallagher, Gennadii Butkevych, Ilya Ponomarev as additional defendants in the case.

Complaint alleges, among other things, that defendants made materially false and misleading statements in violation of Section 10(b),14(a)

and 20(a) of the Exchange Act and plaintiffs seek compensatory damages, reasonable cost and expenses including counsel fees and expert

Pursuant to the Scheduling Order, the Company filed its motion to dismiss the Amended Complaint on April 3, 2023, under the newly

consolidated caption and its proposed order to dismiss the matter.

Plaintiffs are expected to file their opposition to the motion to dismiss

no later than May 18, 2023, which would trigger the Company’s deadline to file its reply brief in support of their motion to dismiss

no later than June 20, 2023.

September 8, 2022, the Board appointed Mr.

Quraeshi as CEO of the Company effective from September 12, 2022.

On September 27, 2022, Armanino LLP (“Armanino”) resigned as the independent registered public accounting firm of the Company effective immediately.

On October 7, 2022, the Audit Committee of the Board of Directors of the Company approved the engagement of Yusufali & Associates, LLC, (“Yusufali”) as the Company’s new independent registered public accounting firm.

On November 15, 2022, the Company formed a new wholly-owned subsidiary, Sports.Com, Inc., as a Texas corporation (the “New Subsidiary”).

The New Subsidiary will share the same principal address as the Company.

In connection therewith, on November 19, 2022, the Company filed in the State of Texas a “doing business as” assumed name registration under the name, “Sports.Com”, and intends to file additional assumed name registrations under this name in other U.S.

and foreign jurisdictions.

December 2022, an agreement was signed by and between Sports.com and Data Sports Group, GmbH (“ DSG ”), that provides

Sports.com, Inc.

(“ Sports ”) the exclusive North American distribution rights for sports data products offered and

maintained by DSG.

This suite of offerings is being sold via the same sales resources and sales channels as the lottery data offered

by TinBu, another wholly-owned subsidiary of the Company.

This relationship is in full effect now and the first signed contracts are

expected in the second quarter of 2023.

Company has received funding that became available through Woodford Eurasia Assets, Ltd.

(“ Woodford ”), which entered

into a Loan agreement with the Company on December 7, 2022.

Pursuant to the Loan Agreement, Woodford agreed to fund up to $ 2.5 million,

subject to certain conditions and requirements, of which approximately $ 1.25 million has been received to date and $ 1.25 million is currently

owed pursuant to the terms of the agreement, upon request from the Company.

The parties may also mutually agree to increase the amount

of the funding to $ 52.5 million (i.e., an additional $50 million).

Amounts borrowed accrue interest at the rate of 12% per annum (22%

per annum upon the occurrence of an event of default) and are due within 12 months of the date of each loan.

Amounts borrowed can be

repaid at any time without penalty .

borrowed pursuant to the Loan Agreement are convertible into the Company’s common stock, beginning 60 days after the first loan

date, at the option of the lender, at the rate of 80% of the lowest publicly available price per share of Company common stock within

10 business days of the date of the agreement (which was equal to $0.28 per share), subject to a 4.99% beneficial ownership limitation

and a separate limitation preventing the holder from holding more than 19.99% of the issued and outstanding common stock of the Company,

without the Company obtaining shareholder approval for such issuance .

to the loan included the resignation of four of the then members of the Board of Directors (Lisa Borders, Steven M.

Cohen, Lawrence Anthony

DiMatteo and William Thompson, all of which persons have subsequently resigned from the Board of Directors), and the appointment of two

new directors (who have been appointed).

Subsequent loans under the Loan Agreement also require our compliance with all listing requirements,

unless waived by Woodford.

The Loan Agreement also allows Woodford to nominate another director to the Board of Directors, in the event

any independent member of the Board of Directors resigns.

Proceeds of the loans can only be used by us for restarting our operations, and for general corporate purposes agreed to by Woodford.

Loan Agreement includes confidentiality obligations, representations, warranties, covenants, and events of default, which are customary

for a transaction of this size and nature.

Included in the Loan Agreement are covenants prohibiting us from (a) making any loan in excess

of $1 million or obtaining any loan in amount exceeding $1 million without the consent of Woodford, which may not be unreasonably withheld;

(b) selling more than $1 million in assets;

(d) encumbering any assets, except in the normal course of business, and not in an amount to exceed $1 million;

(e) amending or restating

our governing documents;

(f) declaring or paying any dividend;

(g) issuing any shares which negatively affects Woodford;

and (h) repurchasing

We also agreed to grant warrants to Woodford to purchase 15% of the issued and outstanding common stock of the Company

7,619,207 shares of common stock, with an exercise price equal to the average of the Nasdaq Official Closing Price for each of the ten

days prior to the first amount being debited from the bank account of Woodford, which equates to an exercise price of $ 0.28 per share.

In the event we fail to repay the amounts borrowed when due or Woodford fails to convert the amount owed into shares, the exercise price

of the warrants may be offset by amounts owed to Woodford, and in such case, the exercise price of the warrants will be subject to a

further 25% discount (i.e., will equal $0.21 per share).

On January 30, 2023, Mr.

Moffly resigned as Interim Chief Financial Officer of the Company.

February 1, 2023, the Board of Directors of the Company appointed Mr.

Mark Gustavson as Chief Executive Officer and principal executive

officer of the Company.

Gustavson will also serve as principal financial/accounting officer of the Company until a replacement is

Mark Gustavson, as CEO, replaced Mr.

Quraeshi, who is no longer serving as Chief Executive Officer or as a principal

executive officer of the Company, effective February 1, 2023, as a result of the change in Chief Executive Officer of the Company approved

by the Board of Directors.

On March 13, 2023, John Brier, Bin

Tu and JBBT, LLC (collectively, the “TinBu Plaintiffs”) filed its original complaint against Lottery.com, Inc.

f/k/a AutoLotto,

and its wholly-owned subsidiary TinBu, LLC (“TinBu”) in the Circuit Court of the 13 th Judicial District in

and for Hillsborough County, Florida (the “TinBu Complaint”).

The Complaint alleges breach of contract(s) and misrepresentation

with alleged damages in excess of $ 4.6

The parties agreed to extend the Company and its subsidiary’s deadline to respond until May 1, 2023.

2023, the Company and its subsidiary retained local counsel who filed a Notice of Appearance on behalf of the Company and TinBu and filed

its Motion for Enlargement requesting the Court to extend its deadline to file its initial response to the Complaint by an additional

30 days (the “TinBu Motion”).

As of the date of this Amended Report, the TinBu Motion has not been set for a hearing.

On March 29, 2023, the WinTogether Foundation Board of Directors voted to suspend its relationship with the Company.

On April 25, 2023, the Company recommenced

its ticket sales operations through its Texas retail network.

On April 22, 2023, the Company

signed an exclusive affiliate agreement with International Gaming Alliance (IGA), to supply official Texas lottery tickets in the Dominican

reported on form 8-K filed with the SEC on February 9, 2024, on February 5, 2024, the Company entered into a Memorandum of Understanding

(the “MOU”) with WA Technology Group Limited (“WATG”), whereby the Company has agreed to pay WATG a total of

$ 500,000 US dollars in restricted common stock at a price of $ 3.00 per share.

A second payment by Lottery.com to WATG shall be due in

five years and 2 months from the date of the definitive agreement to be signed by the parties at a later date.

The total consideration

for the second payment is the equivalent of $ 500,000 US dollars in restricted common stock at market value on the date the second payment

In addition, the Company will nominate an individual (at a later date) from WATG to act as a dedicated consultant to the Company

for the purpose of expanding its brand, ticket sales and global operations.

In exchange, the Company shall own a non-exclusive perpetual

single use license for WATG’s Lottery Player & Account Management Software (“PAM”) and WATG shall provide its full

spectrum of iGaming solutions to the Company to manage its global growth strategy.

The parties shall co-operate and collaborate with

one another’s businesses and shall enter a more definitive agreement at a later date.

reported on form 8-K filed with the SEC on February 21, 2024, on February 15, 2024, the

Company entered into a Memorandum of Understanding (the “MOU”) with S&MI Ltd.

(“SportLocker.com”), whereby

it agreed to pay the shareholders of S&MI Ltd.

a total of $ 1,000,000 in restricted common stock at a valuation of $ 3.00 per share.

The first payment of $150,000 in restricted common stock (50,000 shares) of the Company is due and payable not later than June 15,

The remaining payments in restricted common stock to the shareholders of S&MI Ltd.

by the Company will be made as follows:

(i) a second payment of $212,500 (70,833 shares) due on or before August 14, 2024;

(ii) a third payment, of $212,500 (70,833

shares) due on or before November 12, 2024;

(iii) a fourth payment of $212,500 (70,833 shares) due on or before February 10, 2025;

and (vi) a final and fifth payment of $212,500 (70,834 shares) due on or before May 16, 2025.

The terms and conditions set forth

in the MOU shall be incorporated into a definitive agreement to be entered into by the parties with a Closing Date on or before June 30, 2024 or at a date agreeable to both parties.

addition, the Company has agreed to make available to the business of SportLocker.com, cash, media credits or combination thereof over

the twelve months following the Closing Date as additional capital investment into the business plan, to facilitate brand awareness,

user acquisition and general performance marketing and promotion, influencer and subscription campaigns and branding activities of S&MI’s

streaming and social engagement, subject to the Company successfully raising a minimum of new capital.

March 7, 2024, Sports.com, a wholly-owned subsidiary of the Company, announced by press release that it has launched the “Sports.com

The App (which is available for download for free from all major app stores) connects sports content with audiences worldwide.

By uniting a diverse community of sports enthusiasts across various genres, demographics, and countries, Sports.com plans to eliminate

multiple cultural barriers and foster a global sports community.

March 28, 2024, Sports.com, a wholly-owned subsidiary of the Company, announced by press release that it has obtained the rights to live

stream the March 31, 2024 heavyweight title fight between Frazier Clarke and Fabio Wardley.

The live stream was available to view

for free for millions of sports fans in Africa, via the Sports.com website.

live streaming event is the result of a partnership between Sports.com, BOXXER, the fast-growing UK boxing promotional company, and Sky

Sports in the UK and Ireland.

Sports.com had entered into an agreement with BOXXER to provide live coverage through the Sports.com platform

in Africa, via local telecom partners such as Vodacom, which will provide free access to millions of viewers.

partnership underscores Sports.com’s commitment to bringing inclusivity, innovation, and entertainment to sports.

To view the live

streaming event on Sports.com, African-based sports fans were able to sign up via local mobile operators to watch the fight on the Sports.com

Sports.com’s strategic intent is to provide more such content to sports fans in underserved markets including those in

the Middle East and Africa.

April 1, 2024, Lottery.com resumed its sweepstakes offerings through its partnership with the WinTogether.org foundation (DBA:

DonateTo.Win).

The initial sweepstakes will be active until at least September 30, 2024.

April 22, 2024, the Company, by and through its outside legal counsel, issued a cease and desist notice to PR Fire Limited, a U.K.

Samuel Allcock, its CEO, for unlawful attempts to manipulate the public markets by disseminating false and misleading statements

about the Company, its current officers and directors in certain articles caused to be published by PR Fire Limited.

The Company’s

outside legal counsel reported the matter to the proper authorities.

On April 24, 2024, the Company, by and through its outside legal counsel, issued a cease and desist notice to certain

individuals and entities in participation with a common scheme and acting in concert to financial harm to the Company by privately and

publicly disseminating false and misleading statements about the Company, its current officers and directors.

The Company’s outside

legal counsel reported the matter to the proper authorities.

April 29, 2024, the Board of Directors of the Company approved the addition of Mr.

Warren Macal as a member of the Company’s Board

of Directors.

Macal’s nomination follows the December 2023 $ 18 million investment commitment from Prosperity Investment Management

subject to due diligence.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Principal Accounting Fees and Services.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K/A

Item 8. Financial Statements and Supplementary Data