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Acquisition of GameIQ

3 Months Ended

Mar. 31, 2022

Business Combination and Asset Acquisition [Abstract]

Acquisition of GameIQ

3. Acquisition of GameIQ

On January 31, 2022, the Company, through its newly formed Delaware subsidiary, GameIQ Acquisition Corp., Inc., entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GameIQ, a California corporation, that is a developer of consumer gamification technologies for retail businesses. Under the terms of the Merger Agreement, the Company agreed to issue 600,000 restricted shares of its common stock with a fair value of $300,000 and issued promissory notes to Balazs Wellisch, President and co-founder, and Quentin Blackford, Director, of GameIQ, in the principal amounts of $78,813 and $62,101, respectively, bearing interest at 1% per annum, to repay loans by Mr. Wellisch and Mr. Blackford to GameIQ. Each note requires repayment in six equal biannual installments, with the first installment due on the six-month anniversary of the Closing Date as that term is defined in the Merger Agreement. The Merger Agreement closed on February 28, 2022. The closing price of the Company’s common stock was $0.50 per share on both January 31, 2022 and February 28, 2022. The Company accounted for the acquisition as a business combination in accordance with ASC 805, Business Combinations. The Company has also determined that the acquisition does not qualify as significant acquisition under the guidance of SEC S-X Rules 3-05 and 1-02.

The following is a provisional allocation of the purchase price. The following table summarizes the assets acquired, liabilities assumed and provisional purchase price allocation:

 Schedule of Fair Value of Assets Acquired and Liabilities Assumed

		Fair Value
Consideration paid:
Notes payable		$	140,914
Government assistance note payable and accrued interest (EIDL)			15,400
Common stock (600,000 shares of common stock at $0.50 per share)			300,000
Total consideration paid		$	456,314
Provisional Purchase price allocation
Acquired assets (cash)		$	12,805
Goodwill			146,361
Intangible assets			297,148
Total purchase price		$	456,314

The Company estimated that the recorded intangible assets totaled $297,148 and have a two-year estimate life and are subject to amortization.

 Schedule of Finite-Lived Intangible Assets

		Assigned Life		March 31, 2022
Intangible Assets
Customer relationships		24 months		$	141,935
Intellectual property		24 months			155,213
Intangible assets, gross					297,148
Accumulated amortization					(18,480	)
Total Intangible Assets, net of amortization				$	278,668

During the three months ended March 31, 2022, the company recorded amortization expense of $18,480. The following table summarizes the amortization expense to be recorded in future periods for intangible assets that are subject to amortization:

 Schedule of Future Amortization Expense

Year Ending		Amortization
2022 (remaining)		$	105,332
2023			139,574
2024			33,762
Total		$	278,668

The following unaudited pro forma statements of operations present the Company’s pro forma results of operations after giving effect to the purchase of GameIQ based on the historical financial statements of the Company and GameIQ. The unaudited pro forma statements of operations for the three months ended March 31, 2022 and 2021 give effect to the transaction as if they had occurred on January 1, 2021.

 Schedule of Pro Forma Statements of Operations 

		2022				2021
		Three Month Ended March 31,
		2022				2021
		(Proforma, unaudited)				(Proforma, unaudited)
Revenues		$	764,351			$	816,179
Operating expenses
Direct cost of revenues			101,462				114,408
Selling, general and administrative expenses			1,454,061				2,326,994
Amortization of intangible assets			37,069				229,069
Total operating expenses			1,592,592				2,670,471
Loss from operations			(828,241	)			(1,854,292	)
Other income
Other income			1,067,941				619,081
Total Other income			1,067,941				619,081
Net income (loss)		$	239,700			$	(1,235,211	)

Pursuant to the provisions of ASC 805, the following results of operations of GameIQ subsequent to the acquisitions are as follows:

 Schedule of Provisions of Operations Subsequent Acquisitions 

		March 1, 2022 to March 31, 2022
Revenues		$	3,410
Direct cost of revenues			393
Selling, general and administrative expense			4,172
Net loss		$	(1,155	)

These amounts were included in the accompany Consolidated Statement of Operations.

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- References

No definition available.

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- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-URI https://asc.fasb.org/topic&trid=2303972

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 20
-Section 50
-Paragraph 5
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472

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