Arena Group Holdings, Inc. (AREN)

Item
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The
following discussion should be read in conjunction with the consolidated financial statements and the notes to those statements that
are included elsewhere in this Annual Report. Our discussion includes forward-looking statements based upon current expectations that
involve risks and uncertainties, such as our plans, objectives, expectations, and intentions. Actual results and the timing of events
could differ materially from those anticipated in these forward-looking statements as a result of a number of factors. We use words such
as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,”
“expect,” “believe,” “intend,” “may,” “will,” “should,” “could,”
and similar expressions to identify forward-looking statements. All dollar figures presented below are in thousands unless otherwise
stated.

Overview

For
an overview of the Company, see the information above presented under the section labeled “Item 1. Business,” which is in
“Part I” of this Annual Report.

Key
Operating Metrics

Our
key operating metrics are:

We
monitor and review our key operating metrics as we believe that these metrics are relevant for our industry and specifically to us and
to understanding our business. Moreover, they form the basis for trends informing certain predictions related to our financial condition.
Our key operating metrics focus primarily on our digital advertising revenue, which is our most significant revenue stream. As indicated
in the Results of Operations section below for the year ended December 31, 2024, digital advertising revenue decreased by approximately
13%, as compared to the same period in fiscal 2023. Management monitors and reviews these metrics because such metrics are readily measurable
in real time and can provide valuable insight into the performance of and trends related to our digital advertising revenue and our overall
business. We consider only those key operating metrics described here to be material to our financial condition, results of operations
and future prospects.

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For
pricing indicators, we focus on RPM as it is the pricing metric most closely aligned with monthly average pageviews. RPM is an indicator
of yield and pricing driven by both advertising density and demand from our advertisers.

Monthly
average pageviews are measured across all properties hosted on the Platform and provide us with insight into volume, engagement and effective
page management and are therefore our primary measure of traffic. We utilize a third-party source, Google Analytics, to confirm this
traffic data.

As
described above, these key operating metrics are critical for management as they provide insights into our digital advertising revenue
generation and overall business performance. This information also provides feedback on the content on our website and its ability to
attract and engage users, which allows us to make strategic business decisions designed to drive more users to read or view more of our
content and generate higher advertising revenue across all properties hosted on the Platform.

For
the years ended December 31, 2024 and 2023, our RPM was $23.31 and $21.35, respectively. The 9% increase in RPM reflects an increase in
video advertising as a percentage of total digital advertising as digital video advertising is sold at a significantly higher price than
digital display advertising. For the years ended December 31, 2024 and 2023, our monthly average pageviews were 332,913,662 and 394,441,158,
respectively. The 16% decrease in monthly average pageviews is primarily driven by the cessation of publishing of FanNation
sites in early 2024.

All
dollar figures presented below are in thousands unless otherwise stated.

Impact
of Macroeconomic Conditions

Uncertainty
in the global economy presents significant risks to our business. Increases in inflation, instability in the global banking system,
geopolitical factors, including the ongoing conflicts in Ukraine and Israel and the responses thereto impact, and the impact of
tariffs on print production costs and the overall market for advertising may have an adverse effect on our business. While we are
closely monitoring the impact of the current macroeconomic conditions on all aspects of our business, the ultimate extent of the
impact on our business remains highly uncertain and will depend on future developments and factors that continue to evolve. Most of
these developments and factors are outside of our control and could exist for an extended period of time. As a result, we are
subject to continuing risks and uncertainties. For more information regarding these risks and uncertainties, see the section titled
“Risk Factors” in Part 1, Item 1A of this Annual Report on Form 10-K.

Liquidity
and Capital Resources

Going
Concern

Our
accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal course of business. Our consolidated financial statements
do not include any adjustments that might be necessary if we are unable to continue as a going concern.

For
the year ended December 31, 2024, we incurred a net loss from continuing operations of $7,667, and as of December 31, 2024, had cash
on hand of $4,362. Management has evaluated our current and historical net losses from continuing operations to determine if the
significance of those conditions or events would limit our ability to meet our obligations when due, including under the Loan
Documents and Simplify Loan (see Notes 17 and 18). In its evaluation, management determined that substantial doubt exists about our
ability to continue as a going concern for a one-year period following the financial statement issuance date due to the net loss
from continued operations and working capital deficit.

There
can be no assurance that we will be able to execute plans to rectify the recurrence of net losses. If we are unable to execute these
plans, it could lead to selling assets and further reducing costs and cash requirements.

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Cash
and Working Capital Facility

As
of December 31, 2024, our principal sources of liquidity consisted of cash of $4,362 and accounts receivable from continuing operations,
net of our allowance for credit losses, of $31,115. In addition, as of December 31, 2024, we had $39,349 available for additional use
under our working capital loan with Simplify. As of December 31, 2024, the outstanding balance of the Simplify working capital loan was
$10,651. Our cash balance as of the issuance date of our accompanying consolidated financial statements was $3,556.

Debt
Financings and Obligations

The
following table summarizes information about our term debt:

Debt
Activity – During the year ended December 31, 2024, we took steps to extend our debt maturities. Our debt activity during
the year ended December 31, 2024 was as follows:

Our
debt activity during the year ended December 31, 2023 was as follows:

Future
Debt Obligations – As of December 31, 2024, our future contractual debt obligations were $121,342, with $10,651 maturing on
December 1, 2026 and $110,691 maturing on December 31, 2026.

Off-Balance
Sheet Arrangements

None.

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Material
Contractual Obligations

We
have material contractual obligations that arise in the normal course of business primarily consisting of employment contracts, consulting
agreements, leases, liquidated damages, debt and related interest payments. Purchase obligations consist of contracts primarily related
to merchandise, equipment, and third party services, the majority of which are due in the next 12 months. See Note 7, Leases,
Note 14, Liquidated Damages Payable, and Note 18, Term Debt, in our accompanying consolidated financial statements for
amounts outstanding as of December 31, 2024, related to leases, liquidated damages, bridge financing and long-term debt.

During
2022, we assumed a lease for office space in Carlsbad, California, that expired in March 2025. As of December 31, 2024 we remained
responsible for $360 for the remaining lease term. We entered into two subleases that will pay us an aggregate of $36, net of security deposits, through March 2025.

Working
Capital Deficit

We
have financed our working capital requirements since inception through issuances of equity securities and various debt financings. Our
working capital deficit as of December 31, 2024 and 2023 was as follows:

As
of December 31, 2024, we had a working capital deficit of $82,022, as compared to $145,622 as of December 31, 2023, consisting of $40,234
in total current assets and $122,256 in total current liabilities. As of December 31, 2023, our working capital deficit consisted of
$90,399 in total current assets and $236,021 in total current liabilities.

Our
cash flows during the years ended December 31, 2024 and 2023 consisted of the following:

For
the year ended December 31, 2024, net cash used in operating activities was $16,076, consisting primarily of $147,507 of cash paid to
employees, Publisher Partners, Expert Contributors, suppliers, and vendors, and for revenue share arrangements, professional services,
and $17,837 of cash paid for interest, offset by $149,268 of cash received from customers. For the year ended December 31, 2023, net
cash used in operating activities was $24,772, consisting primarily of $239,737 of cash paid to employees, Publisher Partners, Expert Contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees and professional services, and $12,101
of cash paid for interest, offset by $227,066 of cash received from customers.

For
the year ended December 31, 2024, net cash used in investing activities was $5,175, consisting of (i) $54 for purchase of property and
equipment and (ii) $5,121 for capitalized costs for our Platform. For the year ended December 31, 2023, net cash used in investing activities
was $3,212, consisting of $3,773 for capitalized costs for our Platform and $500 for the acquisition of a business, offset by $1,061
from the sale of assets.

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For
the year ended December 31, 2024, net cash provided by financing activities was $16,329, primarily consisting of (i) $561 for the
payment of the contingent consideration, (ii) $20,027 from repayment of our line of credit with SLR Digital Finance LLC
(“SLR”) (iii) $534 for tax payments relating to the withholding of shares of common stock for certain employees and (iv)
$200 payment of deferred cash payments for an acquisition, less (v) $12,000 in net proceeds from the common stock private placement,
and (vi) $25,651 in net proceeds from our working capital loan with Simplify. For the year ended December 31, 2023, net cash
provided by financing activities was $22,895, consisting primarily of $11,333 (excluding accrued offering costs of $167) in net
proceeds from the public offering of common stock, $5,517 from borrowings under our Arena Credit Agreement, $7,543 (excluding debt
issuance costs of $457) in net proceeds from issuance of our bridge notes; offset by $1,423 tax payments relating to the withholding
of shares of common stock for certain employees, and $75 payment of deferred cash payments for an acquisition.

Results
of Operations

Comparison
of Fiscal 2024 to Fiscal 2023

For
the year ended December 31, 2024, the net loss from continuing operations improved $29,548 to $7,667, as compared to our prior
period net loss of $37,215. This improvement was primarily due to a $24,884 decrease in operating expenses as a result of
headcount and consulting spend reductions.

Revenue
and Gross Profit

The
following table sets forth revenue, cost of revenue, and gross profit from continuing operations:

For
the year ended December 31, 2024, we had gross profit of $55,718, as compared to $55,273 for the year ended December 31, 2023, an increase
of $445. Gross profit percentage for the year ended December 31, 2024 was 44.3%, as compared to 38.5% for the year ended December 31,
2023.

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The
increase in gross profit percentage was driven by a higher mix of revenue from video advertising as a percentage of total digital advertising,
as digital video advertising is sold at a significantly higher price than digital display advertising in combination with headcount and consulting spend reductions.

The
following table sets forth revenue from continuing operations by category:

For
the year ended December 31, 2024, total revenue decreased $17,723, or a 12.3% decrease, to $125,907 from $143,630 for the year ended
December 31, 2023. This reflected a decrease in print revenue of $8,434 due primarily to the shutdown of Athlon Outdoor print operations
and a 6.9% decrease in digital revenue from $134,123 for the year ended December 31, 2023 to $124,834 for the year ended December 31,
2024 driven primarily by the cessation of publishing of the FanNation sites in early 2024.

The
primary drivers of the decrease include a $13,274 decrease in our digital advertising revenue driven primarily by the cessation of
publishing of FanNation sites in early 2024, a decrease in our digital subscriptions of $4,156 due to a decline in
subscribers. These decreases were partially offset by an increase in performance marketing revenue that
increased by $7,478 due to growth of our affiliate partner network and expansion of the performance marketing model across our
portfolio and an increase in other digital revenue of $3,690.

Cost
of Revenue

The
following table sets forth cost of revenue from continuing operations by category:

For
the year ended December 31, 2024, we recognized cost of revenue of $70,189, as compared to $88,357 for the year ended December 31,
2023, representing an increase of $18,168. Cost of revenue for the year ended December 31, 2024 was impacted by decreases in
printing, distribution and fulfillment costs of $2,712 due to the shutdown of Athlon Outdoor print operations, a decrease in the
amortization of developed technology and platform development costs of $2,794, a decrease in technology costs of $4,675, internal
cost of content of $1,028, and external cost of content of $6,845 driven by the cessation of publishing of FanNation sites in early
2024, and a decrease in other costs of revenue of $114.

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Operating
Expenses

Selling
and Marketing

The
following table sets forth selling and marketing expenses from continuing operations:

For
the year ended December 31, 2024, we incurred selling and marketing costs of $12,548 as compared to $24,263 for the year ended December
31, 2023. The decrease in selling and marketing costs of $11,715 is primarily related to decreases in payroll and employee benefits costs
of $6,976 due to a reduction in direct sales workforce. In addition, there were decreases in professional marketing services of $2,139,
advertising costs of $887, circulation costs of $906, and stock-based compensation of $1,011; partially offset by other selling and marketing
expenses of $204.

General
and Administrative

The
following table sets forth general and administrative expenses from continuing operations:

For
the year ended December 31, 2024, we incurred general and administrative costs of $30,399 as compared to $43,783 for the year ended
December 31, 2023. The $13,384 decrease in general and administrative expenses is primarily due to decreases in stock-based
compensation of $9,495, and payroll and related expenses of $2,987 as a result of headcount and consulting spend reductions, and a decrease in other
general and administrative expenses of $851; partially offset by an increase in professional services, including accounting, legal
and insurance of $51.

Segment
Revenue

We report our segment results as Sports & Leisure,
Finance, Lifestyle, and Platform. Additionally, certain expenses are not allocated to our segments because they represent Arena-level
activities.

The
following table sets forth revenue by segment:

Sports
& Leisure– decrease of $23,535 is due to the cessation of publishing of FanNation sites in early 2024 and the shutdown
of Athlon Outdoor print operations partially offset by the growth of Athlon Sports.

Finance– decrease of $1,904 is primarily driven by a decrease in digital subscription revenues partially offset by an increase in performance
marketing revenues.

Lifestyle– increase of $3,029 is driven primarily by an increase in performance marketing revenues.

Platform– increase of $4,687 is driven by an increase in digital advertising and other revenues.

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Segment
Gross Profit

The
following table sets forth segment gross profit:

Sports
& Leisure– decrease of $13,237 is due to the cessation of publishing of FanNation sites in early 2024 and the shutdown
of Athlon Outdoor print operations partially offset by the growth of Athlon Sports.

Finance–
increase of $1,284 is primarily driven by an increase in performance marketing revenues which require less content & editorial
spending than other revenue streams.

Lifestyle– increase of $2,626 is driven primarily by an increase in performance marketing revenues which require less content & editorial spending
than other revenue streams.

Platform– increase of $4,357 is driven by an increase in digital advertising and other revenues with controlled cost.

The
following table reconciles segment gross profit to gross profit:

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Other
Expenses

The
following table sets forth other expenses:

Change
in Fair Value of Contingent Consideration– the change in fair value of contingent consideration of $313 for the year ended December
31, 2024 represents the change in fair value of the put option on our common stock in connection with the acquisition of Fexy Studios
(as further described in Note 4, Acquisitions and Dispositions, in our accompanying consolidated financial statements). As part
of that acquisition consideration, we issued 274,692 shares of our common stock, which was subject
to a put option under certain conditions (as further described in Note 16, Fair Value Measurement in our accompanying consolidated
financial statements).

Interest
Expense– we incurred interest expense, net of $14,668 for the year ended December 31, 2024, as compared to $17,965 for the year ended
December 31, 2023. The decrease in interest expense of $3,297 was primarily from lower amortization of debt costs and lower interest
charges on the line of credit.

Liquidated
Damages– we recorded liquidated damages of $306 for the year ended December 31, 2024, as compared to $583 for the year ended December
31, 2023. The decrease of $277 in liquidated damages recorded for the year ended December 31, 2024, is primarily because in 2023 we had
an assessment under certain agreements as a result of filing a registration statement outside of the agreed upon filing deadline.

Income
Taxes

Income
Taxes– for the years ended December 31, 2024 and 2023, we recorded an income tax provision of $249 and $197, respectively, primarily
related to tax deductible goodwill.

For
further details refer to Note 23, Income Taxes, in our accompanying consolidated financial statements.

Use
of Non-GAAP Financial Measures

We
report our financial results in accordance with generally accepted accounting principles in the United States of America (“GAAP”);
however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental
information that enables a better comparison of our performance across periods. We believe Adjusted EBITDA provides visibility to the
underlying continuing operating performance by excluding the impact of certain items that are noncash in nature or not related to our
core business operations. We calculate Adjusted EBITDA as net loss as adjusted for loss from discontinued operations, with additional
adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and amortization, (iv) stock-based compensation, (v)
change in valuation of contingent consideration, (vi) liquidated damages, (vii) loss on impairment of assets, (viii) loss on sale of
assets; (ix) employee retention credit, (x) employee restructuring payments; and (xi) professional and vendor fees. Our non-GAAP measure
may not be comparable to similarly titled measures used by other companies, have limitations as an analytical tool, and should not be
considered in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Additionally, we do not consider
our non-GAAP measures as superior to, or a substitute for, the equivalent measure calculated and presented in accordance with GAAP.
Some of the limitations are that our non-GAAP measure:

36

The
following table presents a reconciliation of Adjusted EBITDA to net loss, which is the most directly comparable GAAP measure, for the
periods indicated:

37

Critical
Accounting Policies and Estimates

The
preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported
amount of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses
during the reported periods. The more critical accounting estimates include estimates related to revenue recognition, platform development,
and impairment of goodwill. We also have other key accounting policies, which involve the use of estimates, judgments and assumptions
that are significant to understanding our results, which are described in Note 2, Summary of Significant Accounting Policies,
in our accompanying consolidated financial statements.

Our
discussion and analysis of the financial condition and results of operations is based upon our consolidated financial statements included
elsewhere in this Annual Report on Form 10-K, which have been prepared in accordance with GAAP. We believe the following critical accounting
policies affect our more significant judgments and estimates used in the preparation of the financial statements. Actual results may
differ from these estimates under different assumptions or conditions.

38

Revenue

In
accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, revenues
are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the
consideration that we expect to receive in exchange for those goods or services. We generate all of our revenue from contracts with
customers. We have determined we are the principal in the majority of our transactions with our customers and therefore we generally
account for revenue on a gross as compared to a net basis, in our statement of operations. We have made this determination based on
our control of the advertising inventory and the ability to monetize the advertising inventory or publications and determine price
before transfer to the customer and because we are also the primary obligor responsible for providing the services to the customer.
Significant costs of revenue are presented as a separate line item on the consolidated statements of operations.

The
following is a description of the principal activities from which we generate revenue:

Advertising
Revenue

Digital
Advertising– we recognize revenue from digital advertisements at the point when each ad is viewed. We enter into contracts with advertising
networks to serve display or video advertisements on the digital media pages associated with our various channels. The quantity of advertisements,
the impression bid prices, and revenue are reported on a real-time basis to our partners. Although reported advertising transactions
are subject to adjustment by the advertising network partners, any such adjustments are known within a few days of month end. We owe
our independent Publisher Partners a revenue share of the advertising revenue earned, which is recorded as service costs in the same
period in which the associated advertising revenue is recognized.

Advertising
revenue that is comprised of fees charged for the placement of advertising on the websites that we own and operate, is recognized as
the advertising or sponsorship is displayed, provided that collection of the resulting receivable is reasonably assured.

Print Advertising –
advertising related revenues for print advertisements are recognized when advertisements are published (defined as an issue’s on-sale
date), net of provisions for estimated rebates, rate adjustments, and discounts.

Performance
Marketing

Performance Marketing transactions involve the promotion of other companies’ products and services over the internet
through digital advertising platforms. We include links to products and services in our display content on the Platform. When a consumer
clicks on the links and completes a purchase of a product or performs a specific action, such as signing up for a service, the Company
earns commissions by promoting products and services through affiliate links. The promise to integrate links in our display content on
the Platform is delivered when a consumer clicks on the links and completes a purchase.

Digital
Subscription Revenue

Digital
subscription revenue is generated by entering into contracts with internet users that subscribe to premium content on our owned and operated
media channels and facilitate such contracts between internet users and our Publisher Partners. These contracts provide internet users
with a membership subscription to access the premium content. For subscription revenue generated by our independent Publisher Partners’
content, we owe our Publisher Partners a revenue share of the membership subscription revenue earned, which is initially deferred and
recorded as deferred contract costs. We recognize deferred contract costs over the membership subscription term in the same pattern that
the associated membership subscription revenue is recognized.

Digital
subscription revenue generated from our websites that we own and operate are charged to customers’ credit cards or are directly
billed to corporate subscribers, and are generally billed in advance on a monthly, quarterly or annual basis. We calculate net subscription
revenue by deducting from gross revenue an estimate of potential refunds from cancelled subscriptions as well as chargebacks of disputed
credit card charges. Net subscription revenue is recognized ratably over the subscription periods. Unearned revenue relates to payments
for subscription fees for which revenue has not been recognized because services have not yet been provided.

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Print
Revenue

Print
revenue includes single copy sales at newsstands.

Single copy revenue is recognized on
the publication’s on-sale date, net of provisions for estimated returns. We base our estimates for returns on historical experience
and current marketplace conditions.

Licensing
and Publisher Revenue

Content
licensing-based revenues and publisher revenues, primarily revenue shares and license exclusivity agreements, are accrued generally
monthly or quarterly based on a sales-based or usage-based royalty promised in exchange for a license of intellectual property.
Generally, revenues are accrued based on estimated sales and adjusted as actual sales are reported by partners. These adjustments
are typically recorded within three months of the initial estimates and have not been material. Any minimum guarantees are typically
earned evenly over the fiscal year or are recognized upfront if materially different than the actual usage pattern. Revenue
associated with sales-based or usage-based royalties where the customer is expected to exceed the minimum are recognized in the same
period in which the underlying sales or usage occurs.

Contract
Modifications

We
occasionally enter into amendments to previously executed contracts that constitute contract modifications. We assess each of these contract
modifications to determine:

A
contract modification meeting both criteria is accounted for as a separate contract. A contract modification not meeting both criteria
is considered a change to the original contract and is accounted for on either a prospective basis as a termination of the existing contract
and the creation of a new contract, or a cumulative catch-up basis.

Platform
Development

For
the years presented, substantially all of our technology expenses are development costs for our Platform that were expensed as incurred
or capitalized as intangible costs. Technology costs are expensed as incurred or in accordance with applicable guidance that requires
costs incurred in the preliminary project and post-implementation stages of an internal use software project be expensed as incurred
and that certain costs incurred in the application development stage of a project be capitalized.

We
capitalize internal labor costs, including compensation, benefits and payroll taxes, incurred for certain capitalized platform development
projects. Our policy with respect to capitalized internal labor stipulates that labor costs for employees working on eligible internal
use capital projects are capitalized as part of the historical cost of the project when the impact, as compared to expensing such labor
costs, is material. Our Platform development capitalized during the application development stage of a project include:

Goodwill

Goodwill
represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in
a business combination. Goodwill is not amortized but rather is tested for impairment at least annually on October 31, or more
frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable.
Recoverability of goodwill is determined by comparing the fair value of our reporting units to the carrying value of the underlying
net assets in the reporting units. If the fair value of a reporting unit is determined to be less than the carrying value of its net
assets, goodwill is deemed impaired, and an impairment loss is recognized to the extent that the carrying value of goodwill exceeds
the difference between the fair value of the reporting unit and the fair value of its other assets and liabilities. We determined
our operating segments are our reportable units for goodwill impairment testing, See Note 11 Goodwill in our accompanying
consolidated financial statements. We determine the fair value of our reporting units by utilizing the discounted cash flow method
of an income approach and the value indicated by the market approach, comparing transaction prices or stock prices of comparable
guideline companies to our market value. The income approach utilized a discounted cash flow analysis, incorporating
management’s projections of revenue growth, operating margins, and discount rates that reflect the risk-adjusted cost of
capital. The market approach considered valuation multiples derived from comparable publicly traded companies. The income and the
market approach are equally weighted when determining fair value of the reportable unit. These analyses require significant
assumptions and judgments. These assumptions and judgments include estimation of future cash flows, projections of revenue growth and operating margins, which is dependent on internal
forecasts, estimation of the long-term rates of growth for our business, estimation of the useful life over which cash flows will
occur, determination of a discount rate and the selection of comparable companies and the interpretation of
their data. As well as a control premium determined by utilizing publicly available data from studies for similar transactions of
public companies. No impairment charges were recorded during the year ended December 31, 2024.

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Recently
Issued Accounting Pronouncements

Note
2, Summary of Significant Accounting Policies, in our accompanying consolidated financial statements appearing elsewhere in this
Annual Report includes Recently Issued Accounting Pronouncements.

Item
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The
following discussion should be read in conjunction with the consolidated financial statements and the notes to those statements that
are included elsewhere in this Annual Report. Our discussion includes forward-looking statements based upon current expectations that
involve risks and uncertainties, such as our plans, objectives, expectations, and intentions. Actual results and the timing of events
could differ materially from those anticipated in these forward-looking statements as a result of a number of factors. We use words such
as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,”
“expect,” “believe,” “intend,” “may,” “will,” “should,” “could,”
and similar expressions to identify forward-looking statements. All dollar figures are presented in thousands unless otherwise stated.

Overview

For
an overview of the Company, see the information above presented under the section labeled “Item 1. Business,” which is in
“Part I” of this Annual Report.

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Key
Operating Metrics

Our
key operating metrics are:

We
monitor and review our key operating metrics as we believe that these metrics are relevant for our industry and specifically to us and
to understanding our business. Moreover, they form the basis for trends informing certain predictions related to our financial condition.
Our key operating metrics focus primarily on our digital advertising revenue, which has experienced significant growth in recent periods
as indicated in the Results of Operations section below. Management monitors and reviews these metrics because such metrics are
readily measurable in real time and can provide valuable insight into the performance of and trends related to our digital advertising
revenue and our overall business. We consider only those key operating metrics described here to be material to our financial condition,
results of operations and future prospects.

For
pricing indicators, we focus on RPM as it is the pricing metric most closely aligned with monthly average pageviews. RPM is an indicator
of yield and pricing driven by both advertising density and demand from our advertisers.

Monthly
average pageviews are measured across all properties hosted on the Platform and provide us with insight into volume, engagement and
effective page management and are therefore our primary measure of traffic. We utilize a third party source, Google Analytics, to
confirm this traffic data.

As
described above, these key operating metrics are critical for management as they provide insights into our digital advertising revenue
generation and overall business performance. This information also provides feedback on the content on our website and its ability to
attract and engage users, which allows us to make strategic business decisions designed to drive more users to read or view more of our
content and generate higher advertising revenue across all properties hosted on the Platform.

For
the years ended December 31, 2023 and 2022 our RPM was $23.95 and $18.17, respectively. The 32% increase in RPM reflects a
significant increase in video advertising as a percentage of total digital advertising as digital video advertising is sold at a
significantly higher price than digital display advertising. For the years ended December 31, 2023 and 2022 our monthly average
pageviews were 464,261,595 and 489,659,595, respectively. The 5% decrease in monthly average pageviews reflects algorithmic changes
at Google, Facebook and other platforms which subdued user click-throughs to the original content.

Impact
of Macroeconomic Conditions

Uncertainty
in the global economy presents significant risks to our business. Increases in inflation, rising interest rates, instability in the global
banking system, geopolitical factors, including the ongoing conflicts in Ukraine and Israel and the responses thereto, and the remaining
effects of the COVID-19 pandemic may have an adverse effect on our business. While we are closely monitoring the impact of the current
macroeconomic conditions on all aspects of our business, the ultimate extent of the impact on our business remains highly uncertain and
will depend on future developments and factors that continue to evolve. Most of these developments and factors are outside of our control
and could exist for an extended period of time. As a result, we are subject to continuing risks and uncertainties. For more information regarding these
risks and uncertainties, see the section titled “Risk Factors” in Part 1, Item 1A of this Annual Report on Form 10-K.

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Liquidity
and Capital Resources

Cash
and Working Capital Facility

As
of December 31, 2023, our principal sources of liquidity consisted of cash of $9,284 and accounts receivable, net of our advances under
the Arena Credit Agreement of $25,202. As of December 31, 2023, the outstanding balance of the Arena Credit Agreement was $19,609. On
March 13, 2024 the Arena Credit Agreement was refinanced with the Simplify Loan. As of the issuance date of our accompanying consolidated
financial statements our cash balance is $4,151 and the balance outstanding under the Simplify Loan is $7,748, with the additional availability of $17,252.

Our
accompanying consolidated financial statements have been presented on the basis that we are a going concern, which contemplates the realization
of assets and satisfaction of liabilities in the normal course of business. We had revenues of $244,203 during fiscal 2023 and have experienced
recurring net losses from operations and negative operating cash flows. Consequently, we were dependent upon continued access to funding
and capital resources from both new investors and related parties. If continued funding and capital resources are unavailable at reasonable
terms, we may not be able to implement our growth plan and plan of operations. These financings may include terms that may be highly
dilutive to existing stockholders.

We
continue to be focused on growing our existing operations and seeking accretive and complementary strategic acquisitions as part of our
growth strategy. We believe, that with additional sources of liquidity and the ability to raise additional capital or incur additional
indebtedness to supplement our internal projections, we will be able to execute our growth plan and finance our working capital requirements
both in the short-term and long-term.

Going
Concern

Management
performed an annual reporting period going concern assessment. We are required to assess our ability to continue as a going concern.
Our accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal course of business. Our accompanying consolidated financial
statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Most
recently, for the year ended December 31, 2023, we incurred a net loss from continuing operations of $55,582, had cash on hand of
$9,284 and a working capital deficit of $145,622. Our net loss from continuing operations and working capital deficit have been
evaluated by management to determine if the significance of those conditions or events would limit our ability to meet our
obligations when due. Also, since our 2023 Notes, Senior Secured Notes, Delayed Draw Term Notes and 2022 Bridge Notes (as further
described below) (collectively “our current debt”) are subject to a forbearance period through the earlier of the following: (a) April 30, 2024, (b) the closing of the
Business Combination, and (c) the termination of the Business Combination (see Note 28, Subsequent Events,
in our accompanying consolidated financial statements), unless we are able to refinance or modify the terms of our current debt we run the risk that our
debt could be called, therefore, we may not be able to meet our obligations when due.

In
our evaluation, management determined there is substantial doubt about our ability to continue as a going concern for a one-year period
following the financial statement issuance date, unless we are able to refinance or modify our current debt.

We
plan to refinance or modify the maturities of our current debt and complete the Business Combination to alleviate the conditions
that raise substantial doubt about our ability to continue as a going concern, however, there can be no assurance that we will be able to refinance or modify our current debt and complete the
Business Combination.

28

Debt
Financings and Obligations

Net
proceeds from our debt financings consisted of the following:

Arena
Credit Agreement. We were party to a financing and security agreement with SLR (the “Arena Credit Agreement”), as amended on December 15, 2022 and August 31,
2023, pursuant to which SLR extended a $40,000 line of credit for working capital purposes secured by a first lien on all our cash
and accounts receivable and a second lien on all other assets. Borrowings under the facility bore interest at the prime rate plus 4%
per annum of the amount advanced and had a maturity date of December 31, 2025. The aggregate principal amount outstanding, plus
accrued and unpaid interest as of December 31, 2023 was $19,609. On March 13, 2024, the Arena Credit Agreement was refinanced by
the Simplify Loan, which bears interest at 10% per annum of the amount advanced and has a maturity date of March 13, 2026.

2023
Notes. Pursuant to the Third A&R NPA (as defined below),
on August 31, 2023, we issued $5,000 aggregate principal amount of notes with additional borrowings of $1,000 on September 29, 2023
and $2,000 on November 23, 2023 (the “2023 Notes”). On December 1, 2023, Renew,
an affiliated entity of Simplify, in its capacity as agent for the purchasers and as purchaser, purchased the 2023 Notes from BRF
Finance Co., LLC (“BRF Finance”), an affiliated entity of B. Riley Financial, Inc. (“B. Riley”).
Borrowings under the 2023 Notes bore interest at 10% per annum. On
December 29, 2023, we failed to make the interest payment due on the 2023 Notes
resulting in an event of default with subsequent agreement to a forbearance period through the earlier of the following: (a)
April 30, 2024; (b) the occurrence of the closing of the Business Combination and (c) the termination of the Business Combination
prior to closing (further details are
provided under the heading Arena Loan Agreement in Note 28, Subsequent Events in our accompanying consolidated
financial statements). The balance outstanding under our 2023 Notes as of December 31, 2023 was $8,000.

Bridge
Notes. Pursuant to the Third A&R NPA (as defined below), on December 15, 2022, we issued $36,000 aggregate principal amount
of senior secured notes (the “Bridge Notes”). On
December 1, 2023, Renew, an affiliated entity of Simplify, in its capacity as agent for the purchasers and as purchaser,
purchased the Bridge Notes from BRF Finance. We received net proceeds of $34,728, after the payment of $1,000 to B. Riley for an
advisory fee and $272 for other legal costs, from the issuance of the Bridge Notes. Interest on the Bridge Notes was payable in cash
at a rate of 10% per annum as amended on August 31, 2023, from 12% per annum quarterly, with an increase in the interest rate by
1.5% per annum on March 1, 2023, May 1, 2023 and July 1, 2023. On December 29, 2023,
we failed to make the interest payment due on the Bridge Notes resulting in an event of default with subsequent agreement to a forbearance
period through the earlier of the following: (a) April 30, 2024; (b)
the occurrence of the closing of the Business Combination and (c) the termination of the Business Combination prior to closing (further
details are provided under the heading Arena Loan Agreement in Note 28, Subsequent Events in our accompanying consolidated
financial statements). The Bridge Notes are subject to certain mandatory prepayment requirements,
including, but not limited to, a requirement that we apply the net proceeds from certain debt incurrences or equity offerings to
repay the Bridge Notes. We may elect to prepay the Bridge Notes, at any time, at our option at 100% of the principal amount. The
Bridge Notes are secured by liens on the same collateral that secures indebtedness under our outstanding Senior Secured Notes (as
defined below) and are guaranteed by our subsidiaries that guarantee the Third A&R NPA. The Note Purchase Agreement contains
covenants and events of default substantially similar to those contained in the note purchase agreement that governed the Third
A&R NPA. The proceeds received were used for the acquisition of Men’s Journal and to repay $5,928 of our existing Delayed
Draw Term Notes (as defined below). The balance outstanding under our Bridge Notes as of December 31, 2023 was $36,000.

Senior
Secured Notes. We are party to a third amended and restated note purchase agreement (the “Third A&R NPA”), with
Renew, an affiliated entity of Simplify,
where we issued senior secured notes (the “Senior Secured Notes”). On December 1, 2023, Renew purchased the
Senior Secured Notes from BRF Finance. The Senior Secured Notes bear interest at a rate of 10% per annum. Interest payments are
payable at Renew’s discretion either in cash quarterly in arrears on the last day of each quarter or by adding the interest to
the outstanding principal amount. On December 29, 2023, we failed to make the interest payment due on the Senior Secured Notes resulting in an event of default with subsequent agreement to a forbearance period through
the earlier of the following: (a) April 30, 2024;
(b) the occurrence
of the closing of the Business Combination and (c) the termination of the Business Combination prior to closing (further
details are provided under the heading Arena Loan Agreement in Note 28, Subsequent Events in our accompanying consolidated financial statements). The balance
outstanding under our Senior Secured Notes as of December 31, 2023 was $62,691, which included outstanding principal of $48,791 and
payment of in-kind interest of $13,900 that we were permitted to add to the aggregate outstanding principal balance.

Delayed
Draw Term Notes. Pursuant to the Third A&R NPA, we agreed to issue delayed draw term notes (the “Delayed Draw Term
Notes”). On December 1, 2023, Renew, an affiliated entity of Simplify, in its capacity as agent for the purchasers and as
purchaser, purchased the Delayed Draw Term Notes from BRF Finance. The Delayed Draw Term Notes bear interest at a rate of 10% per
annum. Interest payments are payable, at Renew’s discretion, either in cash quarterly in arrears on the last day of each
fiscal quarter or in kind in arrears on the last day of each fiscal quarter. On December 29, 2023, we failed to make the interest
payment due on the Delayed Draw Term Notes resulting in an event of default with subsequent agreement to a forbearance period through
the earlier of the following: (a) April 30, 2024;
(b) the occurrence
of the closing of the Business Combination and (c) the termination of the Business Combination prior to closing (further
details are provided under the heading Arena Loan Agreement in Note 28, Subsequent Events in our accompanying
consolidated financial statements). We paid $5,928 in principal on December 31, 2022. The Delayed Draw Term Notes have a maturity
date of December 31, 2026. The balance outstanding under the Delayed Draw Term Notes as of December 31, 2023 was $4,000.

29

Acquisition

On
January 11, 2023, we entered into an asset purchase agreement with Teneology, Inc., pursuant to which we acquired certain assets (consisting
of the RoadFood media business, including digital and television assets; the Moveable Feast media business, including digital and television
assets; the Fexy-branded content studio business; and the MonkeySee YouTube Channel media business, collectively “Fexy Studios”),
for a purchase price of $3,307. The purchase price consisted of the following: (1) $500 cash paid at closing; (2) $75 cash payments due
in three equal installments of $25 on March 1, 2023 (paid), April 1, 2023 (paid) and May 1, 2023 (paid); (3) $200 deferred cash payment
due on the first anniversary of the closing date, subject to certain indemnity provisions; and (4) the issuance of 274,692 shares of
our common stock, subject to certain lock-up provisions, on the closing date with a fair value of $2,000 (fair value was determined based
on an independent appraisal); and which is subject to a put option under certain conditions. The number of shares of the Company’s common
stock issued was determined based on a $2,225 value using the common stock trading price on the day immediately preceding the January
11, 2023 closing date (on the closing date the common stock trading price was $7.94 per share).

Off-Balance
Sheet Arrangements

None.

Material
Contractual Obligations

We
have material contractual obligations that arise in the normal course of business primarily consisting of employment contracts,
consulting agreements, leases, liquidated damages, debt and related interest payments. Purchase obligations consist of contracts
primarily related to merchandise, equipment, and third party services, the majority of which are due in the next 12 months. See Note
7, Leases, Note 15, Liquidated Damages Payable, Note 18, Bridge Notes, and Note 19, Long-term Debt, in
our accompanying consolidated financial statements for amounts outstanding as of December 31, 2023, related to leases, liquidated
damages, bridge financing and long-term debt.

During
2022, we assumed the lease from Men’s Journal for office space in Carlsbad, California, that expires in March 2025, and as of December
31, 2023 we remain responsible for $1,439 over the remaining lease term. The lease provides for fixed payments of $89 for three months,
$92 for twelve months and $94 for twelve months, with an estimate of common expenses per month of $25 through the end of the lease term.
Pursuant to two subleases entered into during 2023, the sublessees will pay us an aggregate of $312, net of security deposits, through
March 2025.

We also subleased our office space in Santa Monica, California in November 2021 and remain responsible to the original
lessor for $373 through October 2024. Pursuant to the sublease, the sublessee will pay us an aggregate of $225 through October 2024.

During
2021, we entered into a termination agreement of our sublease agreement for a property located in New York, New York and remain responsible
for $4,000 in cash payments to the sublandlord through October 2024.

Working
Capital Deficit

We
have financed our working capital requirements since inception through issuances of equity securities and various debt financings. Our
working capital deficit as of December 31, 2023 and 2022 was as follows:

As
of December 31, 2023, we had a working capital deficit of $145,622, as compared to $137,669 as of December 31, 2022, consisting of $90,399
in total current assets and $236,021 in total current liabilities. As of December 31, 2022, our working capital deficit consisted of
$78,695 in total current assets and $216,364 in total current liabilities.

30

Our
cash flows during the years ended December 31, 2023 and 2022 consisted of the following:

For
the year ended December 31, 2023, net cash used in operating activities was $24,772, consisting primarily of $239,737 of cash paid to
employees, Publisher Partners, Expert Contributors, suppliers, and vendors, and for revenue share arrangements and professional services,
and $12,101 of cash paid for interest, offset by $227,066 of cash received from customers. For the year ended December 31, 2022, net
cash used in operating activities was $11,304, consisting primarily of $219,282 of cash paid to employees, Publisher Partners, Expert
Contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees and professional services, and $9,528
of cash paid for interest, offset by $219,407 of cash received from customers.

For
the year ended December 31, 2023, net cash used in investing activities was $3,212, consisting primarily of $3,773 for capitalized costs
for our Platform and $500 for the acquisition of a business, offset by $1,061 from sale of assets. For the year ended December 31, 2022,
net cash used in investing activities was $38,590, consisting primarily of $35,331 for the acquisition of a business, $5,179 for capitalized
costs for our Platform, and $530 for property and equipment, offset by $2,450 from the sale of an equity investment.

For
the year ended December 31, 2023, net cash provided by financing activities was $22,895, consisting primarily of $11,333 (excluding accrued
offering costs of $167) in net proceeds from the public offering of common stock, $5,517 from borrowings under our Arena Credit Agreement,
$7,543 (excluding debt issuance costs of $457) in net proceeds from issuance of our 2023 Notes; offset by $1,423 tax payments relating to
the withholding of shares of common stock for certain employees, and $75 payment of deferred cash payments for an acquisition. For the
year ended December 31, 2022, net cash provided by financing activities was $54,416, consisting primarily of $30,490 (net of issuance
costs paid of $1,568) in net proceeds from a public offering of common stock, $28,800 (net of issuance costs paid of $1,272 and payments
of $5,928) in proceeds from long term-debt, $2,104 from advancements of our Arena Credit Agreement, and $95 from exercises of common
stock options, offset by $4,468 for tax payments relating to the withholding of shares of common stock for certain employees, $2,152
related to payments of restricted stock liabilities, and $453 related to deferred cash payments for an acquisition.

31

Results
of Operations

Comparison
of Fiscal 2023 to Fiscal 2022

For
the year ended December 31, 2023, the loss from operations improved $20,081 to $35,802 as compared to $55,883 during the year ended
December 31, 2022 due to a $23,268 increase in revenue, with a $6,130 decrease in operating expenses. For the year ended December
31, 2023, the net loss was $55,582, a decrease of $15,276 as compared to a net loss of $70,858 for the year ended December 31, 2022
as the improvement in the loss from operations was partially offset by an increase in interest expense of $6,537 included in other
expenses.

Revenue

The
following table sets forth revenue, cost of revenue, and gross profit from continuing operations:

For
the year ended December 31, 2023 we had gross profit of $101,963, as compared to $88,012 for the year ended December 31, 2022, an increase
of $13,951. Gross profit percentage for the year ended December 31, 2023 was 41.8%, as compared to 39.8% for the year ended December
31, 2022.

The improvement in gross profit percentage was driven by an increase
in total revenue of $23,268, or 10.5%, primarily as a result of increased digital advertising due to improved programmatic video inventory
monetization. This increase is partially offset by an increase in cost of revenue of $9,317, or 7%, resulting from higher publisher partner
revenue share along with increased technology, Platform and software licensing costs.

32

The
following table sets forth revenue from continuing operations by category:

For
the year ended December 31, 2023, total revenue increased $23,268 to $244,203 from $220,935 for the year ended December 31, 2022. The
primary sources of revenue for the year ended December 31, 2023 were as follows: (i) digital advertising of $135,376, (ii) digital subscriptions
of $12,764, (iii) licensing and syndication revenue and other digital revenue of $23,866, (iv) print advertising of $9,881 and (v) print
subscriptions of $62,316

The
primary driver of the increase in our total revenue is derived from digital advertising revenue which benefited from a 32% rise in RPMs
due to the higher mix of higher priced digital video advertising in the year ended December 31, 2023 versus the prior year. Other digital
revenue, which was mostly e-commerce revenue, increased by $4,218 to $5,384. These improvements were partially offset by a decrease in
digital subscriptions of $8,392, resulting in a $22,194, or 14.8%, increase in total digital revenue for the year ended December 31, 2023
as compared to the prior year period. In addition, total print revenue increased by $1,074 as print advertising decreased by $333 and
print subscriptions grew by $1,407.

Cost
of Revenue

The
following table sets forth cost of revenue from continuing operations by category:

For
the year ended December 31, 2023, we recognized cost of revenue of $142,240, as compared to $132,923 for the year ended December 31,
2022, representing an increase of $9,317. Cost of revenue for the year ended December 31, 2023 was impacted by increases in (i) Publisher
Partner revenue share payments of $7,066, (ii) technology, Platform and software licensing fees of $2,696, (iii) content and editorial
expenses of $3,581, and (iv) printing, distribution and fulfillment costs of $556; partially offset by a decrease in stock-based compensation
of $3,673.

33

Operating
Expenses

Selling
and Marketing

The
following table sets forth selling and marketing expenses from continuing operations by category:

For
the year ended December 31, 2023, we incurred selling and marketing costs of $74,245 as compared to $72,489 for the year ended December
31, 2022. The increase in selling and marketing costs of $1,756 is primarily related to increases in (i) payroll and employee benefits
of $4,639, (ii) circulation costs of $251, and (iii) subscription acquisition costs of $922; partially offset by decreases in (i) professional
marketing services costs of $1,122, (ii) advertising costs of $1,615 and (iii) stock-based compensation costs of $1,113.

General
and Administrative

The
following table sets forth general and administrative expenses from continuing operations by category:

For
the year ended December 31, 2023, we incurred general and administrative costs of $44,152 as compared to $53,499 for the year ended December
31, 2022. The $9,347 decrease in general and administrative expenses is primarily due to decreases in stock-based compensation of $7,499,
payroll and related expenses of $1,463 and professional services of $1,135.

34

Other
Expenses

The
following table sets forth other expenses:

Change
in Fair Value of Contingent Consideration. The change in fair value of contingent consideration of $1,010 for the year ended December
31, 2023 represents the change in the put option on our common stock in connection with the acquisition of Fexy Studios. As part of that
acquisition consideration, we issued 274,692 shares of our common stock, which was subject to a put option under certain conditions (as
further described in Note 17, Fair Value Measurement in our accompanying consolidated financial statements).

Interest
Expense. We incurred interest expense, net of $17,965 for the year ended December 31, 2023, as compared to $11,428 for the year ended
December 31, 2022. The increase in interest expense of $6,537 was primarily from additional interest from our debt.

Liquidated
Damages. We recorded liquidated damages of $583 for the year ended December 31, 2023, as compared to $1,140 for the year ended December
31, 2022. The decrease of $557 in liquidated damages recorded for the year ended December 31, 2023, is primarily because in 2022 we had
an assessment under certain agreements as a result of filing a registration statement outside of the agreed upon filing deadline.

Income
Taxes

Income
Taxes. For the year ended December 31, 2023, we recorded an income tax provision of $222 primarily related to tax deductible goodwill. For the year ended December 31, 2022, we recorded
an income tax benefit of $1,063 primarily from our acquired deferred tax liabilities from an acquisition during the year and change
in valuation allowance as of year-end that was, in part, offset by certain previous acquisitions related to tax deductible
goodwill.

For
further details refer to Note 24, Income Taxes, in our accompanying consolidated financial statements.

Use
of Non-GAAP Financial Measures

We
report our financial results in accordance with generally accepted accounting principles in the United States of America
(“GAAP”); however, management believes that certain non-GAAP financial measures provide users of our financial
information with useful supplemental information that enables a better comparison of our performance across periods. We believe
Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain items that
are noncash in nature or not related to our core business operations. We calculate Adjusted EBITDA as net loss as adjusted for loss
from discontinued operations, with additional adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and
amortization, (iv) stock-based compensation, (v) change in valuation of contingent consideration, (vi) liquidated damages, (vii)
loss on impairment of assets, (viii) loss on sale of assets; (ix) employee retention credit, (x) employee restructuring payments;
and (xi) professional and vendor fees.

Our
non-GAAP Adjusted EBITDA may not be comparable to a similarly titled measure used by other companies, has limitations as an analytical
tool, and should not be considered in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Additionally,
we do not consider our non-GAAP Adjusted EBITDA as superior to, or a substitute for, the equivalent measures calculated and presented
in accordance with GAAP. Some of the limitations is that Adjusted EBITDA:

35

The
following table presents a reconciliation of Adjusted EBITDA to net loss, which is the most directly comparable GAAP measure, for the
periods indicated:

36

Critical
Accounting Policies and Estimates

The
preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported
amount of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses
during the reported periods. The more critical accounting estimates include estimates related to revenue recognition, platform development,
impairment of long-lived assets, and stock-based compensation. We also have other key accounting policies, which involve the use of estimates,
judgments and assumptions that are significant to understanding our results, which are described in Note 2, Summary of Significant
Accounting Policies, in our accompanying consolidated financial statements.

Our
discussion and analysis of the financial condition and results of operations is based upon our consolidated financial statements included
elsewhere in this Annual Report on Form 10-K, which have been prepared in accordance with GAAP. We believe the following critical accounting
policies affect our more significant judgments and estimates used in the preparation of the financial statements. Actual results may
differ from these estimates under different assumptions or conditions.

37

Revenue

In
accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, revenues are
recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration
that we expect to receive in exchange for those goods or services. We generate all of our revenue from contracts with customers. We account
for revenue on a gross basis, as compared to a net basis, in our statement of operations. We have made this determination based on our
control of the advertising inventory and the ability to monetize the advertising inventory or publications before transfer to the customer
and because we are also the primary obligor responsible for providing the services to the customer. Cost of revenue is presented as
a separate line item on the consolidated statements of operations.

The
following is a description of the principal activities from which we generate revenue:

Advertising
Revenue

Digital
Advertising. We recognize revenue from digital advertisements at the point when each ad is viewed. The quantity of advertisements,
the impression bid prices, and revenue are reported on a real-time basis. We enter into contracts with advertising networks to serve
display or video advertisements on the digital media pages associated with our various channels. Although reported advertising transactions
are subject to adjustment by the advertising network partners, any such adjustments are known within a few days of month end. We owe
our independent Publisher Partners a revenue share of the advertising revenue earned, which is recorded as service costs in the same
period in which the associated advertising revenue is recognized.

Advertising
revenue that is comprised of fees charged for the placement of advertising on the websites that we own and operate, is recognized as
the advertising or sponsorship is displayed, provided that collection of the resulting receivable is reasonably assured.

Print
Advertising. Advertising related revenues for print advertisements are recognized when advertisements are published (defined as an
issue’s on-sale date), net of provisions for estimated rebates, rate adjustments, and discounts.

Subscription
Revenue

Digital
Subscriptions. We enter into contracts with internet users that subscribe to premium content on our owned and operated media channels
and facilitate such contracts between internet users and our Publisher Partners. These contracts provide internet users with a membership
subscription to access the premium content. For subscription revenue generated by our independent Publisher Partners’ content,
we owe our Publisher Partners a revenue share of the membership subscription revenue earned, which is initially deferred and recorded
as deferred contract costs. We recognize deferred contract costs over the membership subscription term in the same pattern that the associated
membership subscription revenue is recognized.

Digital
subscription revenue generated from our websites that we own and operate are charged to customers’ credit cards or are directly
billed to corporate subscribers, and are generally billed in advance on a monthly, quarterly or annual basis. We calculate net subscription
revenue by deducting from gross revenue an estimate of potential refunds from cancelled subscriptions as well as chargebacks of disputed
credit card charges. Net subscription revenue is recognized ratably over the subscription periods. Unearned revenue relates to payments
for subscription fees for which revenue has not been recognized because services have not yet been provided.

Print
Revenue

Print
revenue includes magazine subscriptions and single copy sales at newsstands.

Print
Subscriptions. Revenue from magazine subscriptions is deferred and recognized proportionately as products are distributed to subscribers.

38

Newsstand.
Single copy revenue is recognized on the publication’s on-sale date, net of provisions for estimated returns. We base our estimates
for returns on historical experience and current marketplace conditions.

Licensing
and Syndication Revenue

Content
licensing-based revenues and syndication revenues are accrued generally monthly or quarterly based on the specific mechanisms of each
contract. Generally, revenues are accrued based on estimated sales and adjusted as actual sales are reported by partners. These adjustments
are typically recorded within three months of the initial estimates and have not been material. Any minimum guarantees are typically
earned evenly over the fiscal year.

Contract
Modifications

We
occasionally enter into amendments to previously executed contracts that constitute contract modifications. We assess each of these contract
modifications to determine:

A
contract modification meeting both criteria is accounted for as a separate contract. A contract modification not meeting both criteria
is considered a change to the original contract and is accounted for on either a prospective basis as a termination of the existing contract
and the creation of a new contract, or a cumulative catch-up basis.

Platform
Development

For
the years presented, substantially all of our technology expenses are development costs for our Platform that were expensed as incurred
or capitalized as intangible costs. Technology costs are expensed as incurred or in accordance with applicable guidance that requires
costs incurred in the preliminary project and post-implementation stages of an internal use software project be expensed as incurred
and that certain costs incurred in the application development stage of a project be capitalized.

We
capitalize internal labor costs, including compensation, benefits and payroll taxes, incurred for certain capitalized platform development
projects. Our policy with respect to capitalized internal labor stipulates that labor costs for employees working on eligible internal
use capital projects are capitalized as part of the historical cost of the project when the impact, as compared to expensing such labor
costs, is material. Our Platform development capitalized during the application development stage of a project include:

39

Business
Combinations

We
account for business combinations using the acquisition method of accounting. The acquisition method of accounting requires that the
purchase price, including the fair value of contingent consideration, of the acquisition be allocated to the assets acquired and liabilities
assumed using the estimated fair values determined by management as of the acquisition date. Goodwill is measured as the excess of consideration
transferred and the net fair values of the assets acquired, and the liabilities assumed at the date of acquisition. While we use best
estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed
at the acquisition date, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period,
we record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent we identified
adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period, which may be up to one year
from the acquisition date, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any
subsequent adjustments are recorded to the consolidated statements of operations. Additionally, we identify acquisition-related contingent
payments and determine their respective fair values as of the acquisition date, which are recorded as accrued liabilities on the consolidated
balance sheets. Subsequent changes in fair value of contingent payments are recorded on the consolidated statements of operations. We
expense transaction costs related to the acquisition as incurred.

Goodwill

Goodwill
represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in a
business combination. Goodwill is not amortized but rather is tested for impairment at least annually on December 31, or more frequently
if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. We operate as one reporting
unit, therefore, the impairment test is performed at the consolidated entity level. Recoverability of goodwill is determined by comparing
the fair value of our reporting unit to the carrying value of the underlying net assets in the reporting unit. If the fair value of our
reporting unit is determined to be less than the carrying value of our net assets, goodwill is deemed impaired, and an impairment loss
is recognized to the extent that the carrying value of goodwill exceeds the difference between the fair value of the reporting unit and
the fair value of our other assets and liabilities.

Stock-Based
Compensation

We provide stock-based compensation in the form of (a) stock awards
to employees and directors, comprised of restricted stock awards and restricted stock units, (b) stock option grants to employees, directors
and consultants, (c) common stock warrants to Publisher Partners (no warrants were issued during the years ended December 31, 2022 or
2021), and (d) common stock warrants to ABG (all as further described in Note 22, Stock-Based Compensation, in our accompanying
consolidated financial statements).

We
account for stock awards and stock option grants to employees, directors and consultants, and non-employee awards to certain directors
and consultants by measuring the cost of services received in exchange for the stock-based payments as compensation expense our consolidated
financial statements. Stock awards and stock option grants to employees and non-employees which are time-vested, are measured at fair
value on the grant date, and charged to operations ratably over the vesting period. Stock awards and stock option grants to employees
and non-employees which are performance-vested, are measured at fair value on the grant date and charged to operations when the performance
condition is satisfied or over the service period.

40

The
fair value measurement of equity awards and grants used for stock-based compensation is as follows: (1) restricted stock awards and restricted
stock units which are time-vested, are determined using the quoted market price of our common stock at the grant date; (2) stock option
grants which are time-vested and performance-vested, are determined utilizing the Black-Scholes option-pricing model at the grant date;
(3) restricted stock units and stock option grants which provide for market-based vesting with a time-vesting overlay, are determined
through consultants with our independent valuation firm using the Monte Carlo model at the grant date; (4) Publisher Partner Warrants
are determined utilizing the Black-Scholes option-pricing model; and (5) ABG warrants are determined utilizing the Monte Carlo model.

Fair
value determined under the Black-Scholes option-pricing model and Monte Carlo model is affected by several variables, the most significant
of which are the life of the stock award, the exercise price of the stock option or warrant, as compared to the fair market value of
our common stock on the grant date, and the estimated volatility of our common stock over the term of the stock award. Estimated volatility
was determined under the (1) “Probability Weighted Scenarios” (prior to our reverse stock split on February 8, 2022) where
one scenario assumes that our common stock will be up-listed on a national stock exchange (the “Exchange”) on a certain listing
date (the “Up-list”) where the estimated volatility was based on evaluating the average historical volatility of a group
of peer companies that are publicly traded and the second scenario assumes our common stock is not up-listed on the Exchange prior to
the final vesting date of the grants (the “No Up-list”) where the historical volatility of our common stock was evaluated
based upon market comparisons; and the (2) “Up-list Scenario” (after our reverse stock split on February 8, 2022) where our
estimated volatility is based on evaluating the average historical volatility of a group of peer companies that are publicly traded after
we up-listed to the NYSE American. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant.
The fair market value of common stock is determined by reference to the quoted market price of our common stock.

We
have elected to recognize forfeitures as they occur and to recognize stock-based compensation cost on a straight-line basis over the
total requisite service period for awards with graded vesting. We classify stock-based compensation cost on our consolidated statements
of operations in the same manner in which the award recipient’s cash compensation cost is classified.

Recently
Issued Accounting Pronouncements

Note
2, Summary of Significant Accounting Policies, in our accompanying consolidated financial statements appearing elsewhere in this
Annual Report includes Recently Issued Accounting Pronouncements.

Item
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The
following discussion should be read in conjunction with the consolidated financial statements and the notes to those statements that
are included elsewhere in this Annual Report. Our discussion includes forward-looking statements based upon current expectations that
involve risks and uncertainties, such as our plans, objectives, expectations, and intentions. Actual results and the timing of events
could differ materially from those anticipated in these forward-looking statements as a result of a number of factors. We use words such
as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,”
“expect,” “believe,” “intend,” “may,” “will,” “should,” “could,”
and similar expressions to identify forward-looking statements. All dollar figures are presented in thousands unless otherwise stated.

Overview

For
an overview of the Company, see the information above presented under the section labeled “Item 1. Business,” which is in
“Part I” of this Annual Report.

Key
Operating Metrics

We
monitor and review the key operating metrics described below as we believe that these metrics are relevant for our industry and specifically
to us and to understanding our business. Moreover, they form the basis for trends informing certain predictions related to our financial
condition. Our key operating metrics focus primarily on our digital advertising revenue, which has experienced significant growth in
recent periods as indicated in the Results of Operations section below. Management monitors and reviews these metrics because
such metrics are readily measurable in real time and can provide valuable insight into the performance of and trends related to our digital
advertising revenue and our overall business. We consider only those key operating metrics described here to be material to our financial
condition, results of operations and future prospects.

Our
key operating metrics are identified below:

For
pricing indicators, we focus on RPM as it is the pricing metric most closely aligned with monthly average pageviews. RPM is an indicator
of yield and pricing driven by both advertising density and demand from our advertisers.

Monthly
average pageviews are measured across all properties hosted on the Platform and provide us with insight into volume, engagement and effective
page management and are therefore our primary measure of traffic. We utilize a third-party source, Google Analytics, to confirm this
traffic data.

As
described above, these key operating metrics are critical for management as they provide insights into our digital advertising revenue
generation and overall business performance. This information also provides feedback on the content on our website and its ability to
attract and engage users, which allows us to make strategic business decisions designed to drive more users to read or view more of our
content and generate higher advertising revenue across all properties hosted on the Platform.

For
the years ended December 31, 2022 and 2021 our RPM was $17.24 and $15.24, respectively. For the years ended December 31, 2022 and 2021
our monthly average pageviews were 516,129,297 and 350,761,233, respectively.

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Impact
of Current Global Economic Conditions

Uncertainty
in the global economy presents significant risks to our business. We are subject to continuing risks and uncertainties in connection
with the current macroeconomic environment, including inflation, rising interest rates and contraction in the availability of credit in the market place, geopolitical factors, including
the ongoing conflict between Russia and Ukraine and the responses thereto, and the remaining effects of the COVID-19 pandemic. We are
closely monitoring the impact of these factors on all aspects of our business, including the impacts on our users, customers, employees,
Publishers Partners, vendors and business partners.

In
particular, with the initial onset of COVID-19, we faced significant
change in our advertisers’ buying behavior. Since May 2020, there has been a steady recovery in the advertising market in both pricing
and volume, which coupled with the return of professional and college sports yielded steady growth in revenues. However, given that our
sports vertical business relies on sporting events to generate content and comprises a material portion of our revenues, our cash flows
and results of operations are susceptible to a widespread cancellation of sporting events or a general limitation of societal activity
akin to what occurred in the United States and elsewhere during 2020. Future widespread shutdowns of in-person economic activity could
have a material impact on our business. In addition, the COVID-19 pandemic has also caused supply chain inefficiencies, negatively impacting
our production and distribution costs in our print operations.

The
ultimate extent of the impact of global economic conditions on our business remains highly uncertain and will depend on future developments
and factors that continue to evolve. Most of these developments and factors are outside of our control and could exist for an extended
period of time. As a result, we are subject to continuing risks and uncertainties and continue to closely monitor the impact of the current
conditions on our business. For more information regarding these risks and uncertainties, see the section titled “Risk Factors”
in Part 1, Item 1A of this Annual Report on Form 10-K.

Liquidity
and Capital Resources

Cash
and Working Capital Facility

As
of December 31, 2022, our principal sources of liquidity consisted of cash of $13,871. In addition, as of December 31, 2022, we had $25,908
available for additional use, subject to eligible accounts receivable, under our working capital line of credit with SLR Digital Finance
LLC (formerly FPP Finance LLC) (“SLR”). As December 31, 2022, the outstanding balance of the SLR working capital line of credit was
$14,092. We also had accounts receivable, net of our advances from SLR of $19,858 as of December 31, 2022. Our cash balance as of the
issuance date of our accompanying consolidated financial statements is $8,203.

Our
accompanying consolidated financial statements have been presented on the basis that we are a going concern, which contemplates the realization
of assets and satisfaction of liabilities in the normal course of business. We had revenues of $220,935 during fiscal 2022 and have experienced
recurring net losses from operations and negative operating cash flows. Consequently, we were dependent upon continued access to funding
and capital resources from both new investors and related parties. If continued funding and capital resources are unavailable at reasonable
terms, we may not be able to implement our growth plan and plan of operations. These financings may include terms that may be highly
dilutive to existing stockholders.

We
continue to be focused on growing our existing operations and seeking accretive and complementary strategic acquisitions as part of our
growth strategy. We believe, that with additional sources of liquidity and the ability to raise additional capital or incur additional
indebtedness to supplement our internal projections, we will be able to execute our growth plan and finance our working capital requirements
both in the short-term and long-term.

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Going
Concern

Management
performed an annual reporting period going concern assessment. We are required to assess our ability to continue as a going concern.
Our accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal course of business. Our accompanying consolidated financial
statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Most
recently, for the year ended December 31, 2022, we incurred a net loss from continuing operations of $67,388, had cash on hand
of $13,871 and a working capital deficit of $137,669. Our net loss from continuing operations and working capital deficit have
been evaluated by management to determine if the significance of those conditions or events would limit our ability to meet our
obligations when due. Furthermore, since our Bridge
Notes of $36,000, Senior Secured Notes of $62,691 and Delayed Draw Term Notes of $4,000, totaling $102,691  (collectively “our current debt”) are due by December 31, 2023 (see Note 19, Bridge Notes,
and Note 20, Long-term Debt, in our accompanying consolidated financial statements), unless we are able to refinance or extend
our current debt beyond its current maturity, we may not be able to meet our obligations when due.

In
our evaluation, management determined there is substantial doubt about our ability to continue as a going concern for a one-year period
following the financial statement issuance date, unless we are able to refinance or extend the maturities of our current debt.

We plan to refinance or extend the maturities of our current debt to alleviate the conditions that raise substantial doubt about our ability
to continue as a going concern.

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Debt
Financings and Obligations

Net
proceeds from our debt financings (see Note 15, Line of Credit, Note 19, Bridge Notes and Note 20, Long-term Debt,
in our accompanying consolidated financial statements for additional information) consisted of the following:

SLR
Credit Facility. We are party to a financing and security agreement with SLR, pursuant to which SLR extended a $25,000 line of credit
for working capital purposes secured by a first lien on all our cash and accounts receivable and a second lien on all other assets. On
December 15, 2022, pursuant to an amendment, the line of credit was increased to $40,000. Borrowings under the facility bear interest
at the prime rate plus 4% per annum of the amount advanced and have a maturity date of December 31, 2024; provided that the maturity
date will be December 31, 2023 if we have not refinanced, repaid or extended all of our Senior Secured Notes (as defined below) due December
31, 2023 by August 31, 2023, and provided further, that SLR will be entitled to accelerate the obligations if we have not refinanced,
repaid or extended all of our Senior Secured Notes due December 31, 2023 by September 30, 2023. In the event that our line of credit
is accelerated, we will be obligated to pay SLR a termination fee of $900. The amendment also permitted us to enter into the Bridge Notes
(as defined below). The aggregate principal amount outstanding, plus accrued and unpaid interest as of December 31, 2022 was $14,092.

Bridge
Notes. On December 15, 2022, we issued $36,000 aggregate principal amount of senior secured notes (the “Bridge Notes”)
pursuant to a Third A&R NPA with BRF Finance Co., LLC (“BRF Finance”), an affiliated entity of B. Riley Financial, Inc.
(“B. Riley”), in its capacity as agent for the purchasers and as purchaser. We received net proceeds of $34,728, after the
payment of $1,000 to B. Riley for an advisory fee and $272 for other legal costs, from the issuance of the Bridge Notes. Interest on
the Bridge Notes is payable in cash at a rate of 12% per annum quarterly in arrears on March 31, 2023, June 30, 2023, September 30, 2023 and December
31, 2023; provided that, on March 1, 2023, May 1, 2023 and July 1, 2023, the interest rate on the Bridge Notes will increase by 1.5%
per annum, with maturity on December 31, 2023. The Bridge Notes are subject to certain mandatory prepayment requirements, including,
but not limited to, a requirement that we apply the net proceeds from certain debt incurrences or equity offerings to repay the Bridge
Notes. We may elect to prepay the Bridge Notes, at any time, at our option at 100% of the principal amount. The Bridge Notes are secured
by liens on the same collateral that secures indebtedness under our outstanding Senior Secured Notes (as defined below) and are guaranteed
by our subsidiaries that guarantee the Third A&R NPA. The Note Purchase Agreement contains covenants and events of default substantially
similar to those contained in the note purchase agreement that governed the Third A&R NPA. The proceeds received were used for the
acquisition of Men’s Journal and to repay $5,928 of our existing Delayed Draw Term Notes (as defined below). The aggregate principal
amount outstanding under the Bridge Notes as of December
31, 2022 was $36,000.

Senior
Secured Notes. We are party to a third amended and restated note purchase agreement (the “Third A&R NPA”), with one
accredited investor, BRF Finance, an affiliated entity of B. Riley. The senior secured notes bears interest at a rate of 10% per annum.
Interest payments are payable at BRF Finance’s discretion either in cash quarterly in arrears on the last day of each quarter or
by adding the interest to the outstanding principal amount. The senior secured notes has a final maturity date of December 31, 2023,
at which time the outstanding principal and all accrued but unpaid interest will be due. The balance outstanding under our senior secured
notes as of December 31, 2022 was $62,691, which included
outstanding principal of $48,791 and payment of in-kind interest of $13,900 that we were permitted to add to the aggregate outstanding
principal balance.

Delayed
Draw Term Notes. Pursuant to the Third A&R NPA, we agreed to issue, at BRF Finance’s option, a delayed draw term notes
(the “Delayed Draw Term Notes”), in the aggregate principal amount of $12,000 to BRF Finance, of which $9,928 was outstanding
on December 31, 2021. The Delayed Draw Term Notes bear interest at a rate of 10% per annum. Interest payments are payable, at BRF Finance’s
discretion, either in cash quarterly in arrears on the last day of each fiscal quarter or in kind in arrears on the last day of each
fiscal quarter. The Delayed Draw Term Notes have a final maturity date of December 31, 2023, at which time the outstanding principal
and accrued but unpaid interest will be due. We paid $5,928 in principal that was due on December 31, 2022, with the remaining principal
balance due on December 31, 2023. The aggregate principal amount outstanding under the Bridge Notes as of December 31, 2022 was $4,000.

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Acquisition

On
January 11, 2023, we entered into an asset purchase agreement with Teneology, Inc., pursuant to which we acquired certain assets
(consisting of the RoadFood media business, including digital and television assets; the
Moveable Feast media business, including digital and television assets; the
Fexy-branded content studio business; and the MonkeySee YouTube Channel media business), for a purchase price of $2,956. The
purchase price consisted of the following: (1) $500 cash paid at closing; (2) $75 cash payments due in three equal installments of
$25 on March 1, 2023, April 1, 2023 and May 1, 2023; (3) $200 deferred cash payment due on the first anniversary of the closing
date, subject to certain indemnity provisions; and (4) the issuance of 274,692 shares of our common stock, subject to certain
lock-up provisions, on the closing date with a fair value of $2,181 (fair value was determined based on our common stock trading
price of $7.94 per share on the closing date). The number of shares of our common stock issued was determined based on a $2,225
value using our common stock trading price on the day immediately preceding the January 11, 2023 closing date.

Off-Balance
Sheet Arrangements

As
of December 31, 2022, pursuant to our line of credit with SLR, as disclosed above, in the event that our line of credit is
accelerated, we will be obligated to pay SLR a termination fee of $900.

Material
Contractual Obligations

We
have material contractual obligations that arise in the normal course of business primarily consisting of employment contracts, consulting
agreements, leases, liquidated damages, debt and related interest payments. Purchase obligations consist of contracts primarily related
to merchandise, equipment, and third-party services, the majority of which are due in the next 12 months. See Note 8, Leases,
Note 16, Liquidated Damages Payable, Note 19 , Bridge Notes, and Note 20, Long-term Debt, in our accompanying consolidated
financial statements for amounts outstanding as of December 31, 2022, related to leases, liquidated damages, bridge financing and long-term
debt.

During
2022, we assumed the lease from Men’s Journal for office space in Carlsbad, California, that expires in March 2025, and we remain
responsible for $3,189 over the lease term. The lease provides for fixed payments of $89 for three months, $92 for twelve months and
$94 for twelve months, with an estimate of common expenses per month of $25 through the end of the lease term.

With
respect to leases, we subleased our office space in Santa Monica, California in November 2021 and remain responsible to the original
lessor for $948 through October 2024. Pursuant to the sublease, the sublessee will pay us an aggregate of $477 through October 2024.

During
2021, we entered into a termination agreement of our sublease agreement for a property located in New York, New York and remain responsible
for $8,000 in cash payments to the sublandlord through October 2024.

Working
Capital Deficit

We
have financed our working capital requirements since inception through issuances of equity securities and various debt financings. Our
working capital deficit as of December 31, 2022 and 2021 was as follows:

As
of December 31, 2022, we had a working capital deficit of $137,669, as compared to $38,742 as of December 31, 2021, consisting of $78,695
in total current assets and $216,364 in total current liabilities. As of December 31, 2021, our working capital deficit consisted of
$77,671 in total current assets and $116,413 in total current liabilities.

35

Our
cash flows during the years ended December 31, 2022 and 2021 consisted of the following:

For
the year ended December 31, 2022, net cash used in operating activities was $11,304, consisting primarily of $219,282 of cash paid to
employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees
and professional services; and $9,528 of cash paid for interest, offset by $219,407 of cash received from customers. For the year ended
December 31, 2021, net cash used in operating activities was $14,729, consisting primarily of $184,932 of cash paid to employees, Publisher
Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees and professional services;
and $1,393 of cash paid for interest, offset by $171,596 of cash received from customers.

For
the year ended December 31, 2022, net cash used in investing activities was $38,590, consisting primarily of $35,331 for the acquisition
of a business; $5,179 for capitalized costs for our Platform; and $530 for property and equipment, offset by $2,450 from the sale of
an equity investment. For the year ended December 31, 2021, net cash used in investing activities was $13,146, consisting primarily of
$7,950 for the acquisition of businesses; $4,819 for capitalized costs for our Platform; and $377 for property and equipment.

For
the year ended December 31, 2022, net cash provided by financing activities was $54,416, consisting primarily of $30,490 (net of issuance
costs paid of $1,568) in net proceeds from a public offering of common stock; $28,800 (net of issuance costs paid of $1,272 and payments
of $5,928) in proceeds from long term-debt; $2,104 from advancements of our SLR line of credit; and $95 from exercises of common stock
options, offset by $4,468 for tax payments relating to the withholding of shares of common stock for certain employees; $2,152 related
to payments of restricted stock liabilities; and $453 payment for The Spun deferred cash payment. For the year ended December 31, 2021,
net cash provided by financing activities was $28,191 consisting primarily of $19,838 (net of issuance cost paid of $167) in net proceeds
from a private placement of common stock; $5,086 in proceeds from long term-debt; $4,809 from advancements of our SLR line of credit,
offset by $1,472 related to payments of restricted stock liabilities; and $70 for tax payments relating to the withholding of shares
of common stock for certain employees.

36

Results
of Operations

Comparison
of Fiscal 2022 to Fiscal 2021