Business Context and Reporting Period
Company: Super League Gaming, Inc. (SLGG)
Filing Type: Form 8-K (Current Report)
Date of Report: September 23, 2019
Reporting Period: Event-based report regarding a material definitive agreement entered into on September 23, 2019.
Key Financial Metrics
This filing is a current report regarding a strategic partnership and does not contain audited financial statements, revenue, profit, cash flow, or margin data for the period.
| Financial Item | Value |
|---|---|
| Upfront Agreement Fee | $340,000 |
| Quarterly Fees | $0 to $150,000 (based on revenue levels) |
| Revenue/Profit/Cash Flow | Not provided in this filing |
| Debt/Liquidity | Not provided in this filing |
Material Changes
The primary material change is the entry into an expanded commercial partnership agreement with ggCircuit, LLC. Key changes include:
- Rebranding: Consumer-facing components of ggCircuit's "ggLeap" software platform (leaderboards, competitive seasons, loyalty programs) will be rebranded as "Super League Gaming."
- Management Transfer: Super League will manage these consumer-facing components starting with a software update targeted for global release in November 2019.
- New Features: Introduction of "Super League Prime" (subscription service), a global loyalty program, and an esports events directory.
Guidance, Outlook, and Risks
Outlook and Management Commentary:
- The agreement is effective October 1, 2019, with an initial term of five years subject to automatic renewal.
- Super League will commercially exploit the "Super League Prime" subscription service and feature its brand on ggCircuit's customer platform.
- Revenues generated under the agreement will be shared between Super League and ggCircuit based on contractual percentages.
Risks and Contingencies:
- The filing states the description of the agreement is not complete and is qualified by reference to the full agreement, which will be filed in the Quarterly Report on Form 10-Q due on or before November 14, 2019.
- Quarterly fees are variable ($0 to $150,000) and dependent on achieving specific contractual revenue levels.
Investor Verification Checklist
- Verify the full text of the agreement in the upcoming Form 10-Q (due November 14, 2019) to understand specific revenue sharing percentages and termination clauses.
- Confirm the actual launch date of the November 2019 software update and the rollout of "Super League Prime."
- Monitor future filings for the impact of the $340,000 upfront fee on cash flow and the variable quarterly fees on operating expenses.
- Assess the adoption rate of the rebranded ggLeap platform by gaming center operators globally.