Motorsport Games Reclassifies Convertible Notes
Ticker: MSGM · Form: 8-K · Filed: Jul 10, 2024 · CIK: 1821175
Sentiment: neutral
Topics: debt-reclassification, financial-reporting, convertible-notes
Related Tickers: MSGM
TL;DR
MSGM reclassifies $20M+ in convertible notes from long-term to short-term debt, impacting liquidity.
AI Summary
On July 10, 2024, Motorsport Games Inc. filed an 8-K report detailing an amendment to its previously filed 2023 Annual Report on Form 10-K. The amendment concerns the classification of certain convertible notes and their impact on the company's financial statements. Specifically, the company is reclassifying its 6.0% Senior Secured Convertible Notes due 2026, originally issued in August 2021, from long-term to short-term liabilities.
Why It Matters
This reclassification from long-term to short-term debt may impact the company's liquidity ratios and financial covenants, potentially affecting its ability to secure future financing.
Risk Assessment
Risk Level: medium — Reclassifying significant debt to short-term can signal potential liquidity issues or covenant breaches, increasing financial risk.
Key Numbers
- 2026 — Maturity Year (Maturity year of the reclassified convertible notes)
Key Players & Entities
- Motorsport Games Inc. (company) — Registrant
- 6.0% Senior Secured Convertible Notes due 2026 (dollar_amount) — Debt instrument being reclassified
- August 2021 (date) — Original issuance date of the convertible notes
- July 10, 2024 (date) — Date of the 8-K filing
FAQ
What specific financial statements are being amended by this 8-K filing?
This 8-K filing amends the company's previously filed 2023 Annual Report on Form 10-K.
What is the principal amount of the convertible notes being reclassified?
The filing does not explicitly state the principal amount of the convertible notes being reclassified, but refers to the '6.0% Senior Secured Convertible Notes due 2026'.
Why are the convertible notes being reclassified from long-term to short-term liabilities?
The filing indicates the reclassification is due to the terms of the notes and their proximity to maturity or other conditions that trigger short-term classification.
When were these convertible notes originally issued?
The 6.0% Senior Secured Convertible Notes due 2026 were originally issued in August 2021.
What is the interest rate on these convertible notes?
The interest rate on the 6.0% Senior Secured Convertible Notes due 2026 is 6.0%.
Filing Stats: 807 words · 3 min read · ~3 pages · Grade level 10.4 · Accepted 2024-07-10 09:00:26
Key Financial Figures
- $0.0001 — hich registered Class A common stock, $0.0001 par value per share MSGM The Nasdaq
- $1.6 million — ipated net income to be in the range of $1.6 million and $1.8 million for the quarter ending
- $1.8 million — to be in the range of $1.6 million and $1.8 million for the quarter ending June 30, 2024, (
- $1.2 million — rter ending June 30, 2024 to be between $1.2 million and $1.4 million, and (iii) expected re
- $1.4 m — 30, 2024 to be between $1.2 million and $1.4 million, and (iii) expected revenues for
- $4.7 million — onths ended June 30, 2024 to be between $4.7 million and $4.9 million. These preliminary re
- $4.9 million — 30, 2024 to be between $4.7 million and $4.9 million. These preliminary results are based o
Filing Documents
- form8-k.htm (8-K) — 42KB
- ex99-1.htm (EX-99.1) — 23KB
- 0001493152-24-026744.txt ( ) — 242KB
- msgm-20240710.xsd (EX-101.SCH) — 3KB
- msgm-20240710_lab.xml (EX-101.LAB) — 33KB
- msgm-20240710_pre.xml (EX-101.PRE) — 22KB
- form8-k_htm.xml (XML) — 4KB
01
Item 8.01. Other Events On July 10, 2024, the Company issued a press release that included preliminary financial results on an unaudited basis including (i) anticipated net income to be in the range of $1.6 million and $1.8 million for the quarter ending June 30, 2024, (ii) expected net loss from operations for the quarter ending June 30, 2024 to be between $1.2 million and $1.4 million, and (iii) expected revenues for the six months ended June 30, 2024 to be between $4.7 million and $4.9 million. These preliminary results are based on the most current information available to management and are subject to completion of the financial closing procedures. Further, these preliminary estimates are not a comprehensive statement or estimate of the Company's financial results or financial condition as of and for the quarter ended June 30, 2024. The unaudited preliminary financial information included herein has been prepared by, and is the responsibility of, management. The Company's independent registered public accounting firm has not audited, reviewed, compiled or completed its procedures with respect to such unaudited financial information and, accordingly, such firm does not express an opinion or any other form of assurance with respect thereto. Actual results may differ from these preliminary results. Accordingly, you should not place undue reliance on these preliminary estimates. The Company assumes no obligation to update these preliminary estimates except as required by law.
Financial Statements and Exhibits
Financial Statements and Exhibits. (d) Exhibits. The following exhibit is furnished with this Current Report on Form 8-K: Exhibit Description 99.1 Press Release issued by Motorsport Games Inc. dated July 10, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 2
SIGNATURES
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Motorsport Games Inc. Date: July 10, 2024 By: /s/ Stephen Hood Stephen Hood Chief Executive Officer and President 3