Motorsport Games Inc.

Thank you for standing by and welcome to Motorsport Games' fourth quarter and full year 2022 earnings conference call and webcast. On today's call are Dimitri Kosko, Motorsport Games Executive Chairman and CEO, and Jason Potter, Chief Financial Officer. I will now hand it over to Ken Godskin of Motorsport Games.

Thank you, Operator. By now, Everyone should have access to the company's fourth quarter and full year 2022 earnings press release filed today after market close. This is available on the investor relations section of Motorsport Games website at www.motorsportgames.com. During the course of this call, management may make forward-looking statements within the meaning of the U.S. federal securities laws. These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Except as required by law, the company undertakes no obligation to update any forward-looking statements made on this call or to update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise. please refer to today's press release and the company's filings with the SEC, including its most recent annual report on Form 10-K for the year ended December 31st, 2022, for a detailed discussion of certain of the risks that could cause actual results to differ material from those expressed or implied in any forward-looking statements made today. In today's conference call, we will refer to certain non-GAAP financial measures, such as adjusted EBITDA, as we discuss the fourth quarter and full year 2022 financial results. You will find a reconciliation of these non-GAAP measures to their most directly comparable GAAP measures, as well as other related disclosures in the press release issued earlier today. And now, I'd like to turn the call over to Dimitri Kosko, Chief Executive Officer of Motorsport Games. Dimitri?

Thank you, everyone, for joining us on the call and following our journey. It's no secret it's been a tough one for us. Between the ongoing war in Ukraine that led us to shutting down our Moscow studio while trying to help those team members that wanted to get out of the country to get out, to overall operational challenges as we continue to focus on improving our liquidity position. But what's amazing is to witness the resilience our team has demonstrated through all of it. as we continue to strive towards making the thrill of motorsport accessible to everyone by creating the highest quality, most sophisticated and innovative experiences for racers, gamers and fans. Since our last few earnings calls, we continue to focus on efficiency and reducing costs where possible without sacrificing the quality of our future games. We are still a product-driven business, thus it's crucial to continue to invest in our games and complementary esports programs. As previously announced, we recently completed various equity offerings, including three registered direct offerings that resulted in more than $11.3 million in aggregate gross proceeds. Each of these registered direct offerings were structured to comply with the SEC's baby shelf rules in order to maximize the amount available to us under our effective S3 registration statement. We're also able to reach an agreement with our majority shareholder, Motorsport Network, to exchange all of our outstanding debt of nearly $4 million with Motorsport Network into the shares of our common stock. I personally believe this reinforces the commitment that our majority shareholder has in Motorsport Games, as well as provides us relief on our balance sheet. Additionally, at the end of January, we received a notice from NASDAQ that we regained compliance for continuing NASDAQ listing. I'm proud of how we were able to complete these recent capital raise transactions in the light of the challenging economic environment. However, we continue to explore additional funding in the form of potential equity and our debt financing arrangements to further improve the liquidity position of our company. Let's talk about our Q4 of last year and 2022 in general. Despite the challenges we experienced with our 2021 admission release in 2021, in 2022, we're still able to make strides in our product release schedule. We started the year with a much-requested UI refresh to our industry-leading R Factor 2 platform, followed by consistent quarterly content drops that helped us grow R Factor 2 install base and R Factor 2 revenue year-over-year. R Factor 2 became the official sim racing platform of Formula E, and our partners at Kindred Labs were able to launch their amazing F1 arcade center in London using our beloved R Factor 2 platform. Aligned with exciting times in the NASCAR world in 2022, we also launched the next-gen cars for test drives within our game. We further continued to invest in our NASCAR fan base by offering them something that we have never done, which was to provide the 2022 Season Expansion DLC update to existing NASCAR 21 ignition holders for absolutely free. And this came after we were able to make the NASCAR 21 ignition compatible for the new-gen consoles. Additionally, we brought our NASCAR 21 ignition game and our karting simulator game, Parkraft, for the first time to NVIDIA GeForce Now, allowing people to enjoy these experiences by leveraging cloud through selected mobile and smart TV devices. And we finished off the year in our NASCAR franchise by releasing the new NASCAR game for the Nintendo Switch platform that we called NASCAR Rivals. which was our official game of the 2022 NASCAR Cup Series season. Today, we continue to focus on the development of our IndyCar, NASCAR, and Le Mans gaming experiences. We recently attracted expert advisors in the gaming space to help consult on our games being developed, which we believe will further enhance our ability to meet our and our fans' expectations for these games. Of course, raising the quality bar will require further time and resources being invested into these fantastic franchises, which we believe will translate into delays in our product release schedule. However, when we will ultimately release these games, we believe they will be worth the wait. This year, we plan to bring 2023 season updates to our NASCAR game for all major platforms such as PlayStation, Xbox, PC, Nintendo Switch, and mobile, allowing our fans to enjoy the latest 2023 season excitement. For our IndyCar game, we continue to make strides in our development efforts, but we do not believe we will be in a satisfactory position to release it to the community this year. The IndyCar community has not had a dedicated IndyCar game in over a decade, and we want to make sure that our IndyCar game is on par with other major racing games out there with enough features to keep IndyCar and other fans excited. As a head of Motorsport Games, I've been honored to lead this company from its inception, nurturing the idea, setting the vision, guiding it through a successful IPO, providing the necessary resources to make key technology and team acquisitions grow and scale. Today, Motorsport Games is a multi-franchise company, boasting a diverse portfolio of official racing games and development for some of the world's most renowned brands in racing, and a foundation built on a cutting-edge technology for the masses. This unique combination is what we believe will drive our industry forward and already fuels our team's pursuit of creating the most immersive and engaging racing games. I'm also incredibly excited to welcome Jason Potter as our company's recently appointed new CFO. Jason is very familiar with Motorsport Games as he held various roles with Motorsport Network since September 2021, including as Chief Accounting Officer. and in fact has been Secretary and Treasurer for Motorsport Games since January of this year. Further, Jason continues to serve as Chief Accounting Officer of the network, but prior to joining the network, he held the position of a Director in an audit practice of PricewaterhouseCoopers between June 2018 and September 2021, and a Senior Manager at PwC's National Office between June 2016 and June 2018. And at this time, I'd like to hand it over to Jason Potter, Motorsport Games Chief Financial Officer, to go over our Q4 and 2022 year-end financial results.