Form 8-K/A - Current report: [Amend]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

(Amendment No. 1)

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 17, 2024

TruGolf Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-40970

85-3269086

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

60 North 1400 West Centerville, Utah		84014
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (801) 298-1997

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Stock, $0.0001 par value per share		TRUG		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

EXPLANATORY NOTE

This Amendment No. 1 to the Current Report on Form 8-K/A (the “Amendment”) is being filed with the Securities and Exchange Commission (“SEC”) to amend the Current Report filed by TruGolf Holdings, Inc. (the “Company”) on February 6, 2024 (the “Original 8-K”) and to provide certain additional information.

The Company is filing this Amendment to, among other things, include:

(a) the audited financial statements of TruGolf, Inc., a Delaware corporation, as of December 31, 2023 and 2022 and for the years ended December 31, 2023 and 2022 as Exhibit 99.1;

(b) the Management’s Discussion and Analysis of Financial Condition and Results of Operations of TruGolf, Inc. as Exhibit 99.2; and

This Amendment does not amend any other item of the Original 8-K or purport to provide an update or a discussion of any developments at the Company or its subsidiaries subsequent to the filing date of the Original 8-K.

Item 9.01

Financial Statements and Exhibits.

(a) Financial statements of businesses or funds acquired.

The financial statements of TruGolf, Inc. as of December 31, 2023 and 2022, and for the years ended December 31, 2023 and 2022, and the related notes thereto, are set forth in Exhibit 99.1 attached hereto and are incorporated by reference herein.

(b) Pro forma financial information.

The unaudited pro forma condensed combined financial information of the Company as of December 31, 2023, and for the year ended December 31, 2023 is set forth in Exhibit 99.3 hereto and is incorporated herein by reference.

(d) Exhibits.

Exhibit No.		Description

99.1		Audited financial statements of TruGolf, Inc., as of December 31, 2023 and 2022 and for the years ended December 31, 2023 and 2022.

99.2		Management’s Discussion and Analysis of Financial Condition and Results of Operations of TruGolf, Inc.

99.3		Unaudited pro forma condensed combined financial information of the Company.

104		Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 17, 2024	TRUGOLF HOLDINGS, INC.

	By:	/s/ Lindsay Jones
	Name:	Lindsay Jones
	Title:	Chief Financial Officer

Exhibit 99.1

TRUGOLF, INC

FINANCIAL STATEMENTS

DECEMBER 31, 2023 and 2022

TABLE OF CONTENTS

Report of Independent Registered Public Accounting Firm (PCAOB ID Number: 457)	2

Report of Independent Registered Public Accounting Firm (PCAOB ID Number: 596)	3

Financial Statements

Balance Sheets	4

Statements of Operations	5

Statements of Changes in Stockholders’ Deficit	7

Statements of Cash Flows	8

Notes to Financial Statements	9

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of TruGolf, Inc

Opinion on the Financial Statements

We have audited the accompanying balance sheet of TruGolf, Inc (the Company) as of December 31, 2023, and the related statements of operations, comprehensive loss, stockholders’ deficit, and cash flows for the year then ended December 31, 2023, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year then ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Haynie & Company

We have served as the Company’s auditor since 2024.
Salt Lake City, Utah
April 17, 2024

Report of Independent Registered Public Accounting Firm

To the Board of Directors of

TruGolf, Inc.

Centerville, Utah

Opinion on the Financial Statements

We have audited the accompanying balance sheet of TruGolf, Inc. (the “Company”) at December 31, 2022, and the related statements of operations, changes in stockholders’ deficit, and cash flows for the year ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022, and the results of its operations and its cash flows for the year ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

/s/ CohnReznick LLP

CohnReznick LLP

We have served as the Company’s auditor since 2022 (such date takes into account the acquisition of certain people and assets of Daszkal Bolton LLP by CohnReznick LLP effective March 1, 2023)

Boca Raton, Florida

July 31, 2023

TRUGOLF, INC.

BALANCE SHEETS

AS OF DECEMBER 31, 2023 and 2022

	2023			2022
ASSETS
Current assets:
Cash and cash equivalents	$	3,297,564		$	9,656,266
Restricted cash		2,100,000			-
Marketable investment securities		2,478,953			-
Accounts receivable, net		2,398,872			1,744,637
Inventory, net		2,119,084			2,121,480
Prepaid expenses		262,133			147,748
Other current assets		-			17,840
Total current assets		12,656,606			13,687,971

Property and equipment, net		234,308			165,536
Right-of-use assets		972,663			732,877
Other long-term assets		1,905,983			-

Total assets	$	15,769,560		$	14,586,384

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	2,059,771		$	1,463,337
Customer deposits		1,704,224			2,712,520
Notes payable, current portion		9,425			105,213
Notes payable to related parties, current portion		1,237,000			937,000
Line of credit, bank		802,738			545,625
Margin line of credit account		1,980,937			-
Convertible notes payable		954,622			578,481
Accrued interest		459,872			92,552
Accrued and other current liabilities		1,125,495			750,676
Lease liability, current portion		334,255			224,159
Total current liabilities		10,668,339			7,409,563

Non-current liabilities:
Notes payable, net of current portion		2,402,783			288,618
Note payables to related parties, net of current portion		861,000			1,148,000
Dividend notes payable		4,023,923			7,660,784
Gross sales royalty payable		1,000,000			1,000,000
Lease liability, net of current portion		668,228			510,178
Other liabilities		63,015			-
Total liabilities		19,687,288			18,017,143

Stockholders’ deficit:
Preferred stock, $0.01 par value, 10 million shares authorized; zero shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively		-			-
Common stock, $0.01 par value, 190 million shares authorized; 13,098 and 11,308 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively.		120			100
Treasury stock at cost, 4,692 shares of common stock held at December 31, 2023 and December 31, 2022, respectively		(2,037,000	)		(2,037,000	)
Additional paid-in capital		10,479,738			681,956
Accumulated other comprehensive loss		(1,662	)		-
Accumulated losses		(12,358,924	)		(2,075,815	)
Total stockholders’ deficit		(3,917,728	)		(3,430,759	)

Total liabilities and stockholders’ deficit	$	15,769,560		$	14,586,384

The accompanying notes are an integral part of these financial statements.

TRUGOLF, INC.

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2023 and 2022

	2023			2022

Revenues, net	$	20,583,851		$	20,227,331
Cost of revenues		(7,825,768	)		(7,018,378	)
Gross profit		12,758,083			13,208,953

Operating expenses:
Royalties		709,640			550,963
Salaries, wages and benefits		9,681,323			6,973,227
Selling, general and administrative		11,027,332			4,952,381
Total operating expenses		21,418,295			12,476,571

(Loss) income from operations		(8,660,212	)		732,382

Other (expenses) income:
Interest income		108,011			-
Interest expense		(1,730,908	)		(1,589,223	)
Loss on investment		-			(100,000	)
Total other expense		(1,622,897	)		(1,689,223	)
Loss from operations before income taxes		(10,283,109	)		(956,841	)

Provision for income taxes		-			-
Net loss		(10,283,109	)		(956,841	)

Basic and diluted net loss per share attributable to common stockholders	$	(857.35	)	$	(84.62	)

Basic and diluted weighted average common shares		11,994			11,308

The accompanying notes are an integral part of these financial statements.

TRUGOLF, INC.

STATEMENTS OF COMPREHENSIVE LOSS

FOR THE YEARS ENDED DECEMBER 31, 2023 and 2022

	2023			2022

Net loss	$	(10,283,109	)	$	(956,841	)

Other comprehensive income:

Unrealized loss in fair value of short-term investments		(1,662	)		-

Comprehensive loss	$	(10,284,771	)	$	(956,841	)

The accompanying notes are an integral part of these financial statements.

TRUGOLF, INC.

STATEMENTS OF STOCKHOLDERS’ DEFICIT

FOR THE YEARS ENDED DECEMBER 31, 2023 and 2022

	Preferred Stock				Common Stock				Treasury Stock						Additional		Accumulated Other Comprehensive			Accumulated			Total Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Paid-in Capital		Loss			Losses			Deficit

Balance, December 31, 2021		-	$	-		11,308	$	100		(4,692	)	$	(2,037,000	)	$	-	$	-		$	(1,118,974	)	$	(3,155,874	)

Fair value of warrants granted																681,956								681,956

Net loss		-		-		-		-		-			-			-		-			(956,841	)		(956,841	)

Balance, December 31, 2022		-	$	-		11,308	$	100		(4,692	)	$	(2,037,000	)	$	681,956	$	-		$	(2,075,815	)	$	(3,430,759	)

Issuance of common stock to consultants for services		-		-		821		9		-			-			4,493,324		-			-			4,493,333

Issuance of common stock to employees for services		-		-		252		3		-			-			1,379,193		-			-			1,379,196

Issuance of common stock for conversion of dividend payable		-		-		717		8		-			-			3.925.265		-			-			3,925,273

Unrealized loss in fair value of short-term investments		-		-		-		-		-			-			-		(1,662	)		-			(1,662	)

Net loss		-		-		-		-					-			-					(10,283,109	)		(10,283,109	)

Balance, December 31, 2023		-	$	-		13,098	$	120		(4,692	)	$	(2,037,000	)	$	10,479,738	$	(1,662	)	$	(12,358,924	)	$	(3,917,728	)

The accompanying notes are an integral part of these financial statements.

TRUGOLF, INC.

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2023 and 2022

	2023			2022
Cash flows from operating activities:
Net loss	$	(10,283,109	)	$	(956,841	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization expense		58,641			60,667
Amortization of convertible notes original issue discount		97,111			240,048
Amortization of right-of-use asset		298,208			165,535
Fair value of warrants in excess of fair value of debt		93,530			445,032
Bad debt expense		681,479			-
Loss on equity investment		-			100,000
Stock issued for services		5,872,529			-
Changes in operating assets and liabilities:
Marketable investment securities		12,530			-
Accounts receivable, net		(1,335,714	)		(244,355	)
Inventory, net		2,396			(265,615	)
Prepaid expenses		(114,385	)		210,335
Other current assets		17,840			(140	)
Other assets		(1,905,983	)		-
Accounts payable		596,434			786,084
Customer deposits		(1,008,296	)		118,172
Accrued interest payable		615,582			92,552
Accrued and other current liabilities		374,819			208,515
Other liabilities		63,015			-
Lease liability		(269,848	)		(168,110	)
Net cash (used in) provided by operating activities		(6,133,221	)		791,879

Cash flows from investing activities:
Purchase of property and equipment		(127,413	)		(41,430	)
Purchase of short-term investments		(2,493,145	)		-
Net cash used in investing activities		(2,620,558	)		(41,430	)

Cash flows from financing activities:
Proceeds from line of credit		1,980,937			-
Proceeds from notes payable		2,433,059			-
Repayments of notes payable		(107,569	)		(125,511	)
Repayments of notes payable - related party		(37,000	)		(287,000	)
Proceeds from convertible notes		185,500			575,357
Repayment of line of credit
Dividends paid		40,150			(1,965,706	)
Net cash provided by (used in) financing activities		4,495,077			(1,802,860	)

Net change in cash, cash equivalents, and restricted cash		(4,258,702	)		(1,052,411	)

Cash, cash equivalents, and restricted cash, beginning of period		9,656,266			10,708,677

Cash, cash equivalents and restricted cash, end of period	$	5,397,564		$	9,656,266

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest	$	1,115,332		$	602,255
Conversion of dividend noted payable and accrued interest	$	3.925,273			-
Conversion of note payable to line of credit	$	257,113			-
Warehouse lease	$	537,994			-

The accompanying notes are an integral part of these financial statements.

TRUGOLF INC.

NOTES TO FINANCIAL STATEMENTS

1.	ORGANIZATION AND NATURE OF OPERATIONS

For over 40 years, TruGolf, Incorporated (or “the Company”, “we”, “us”, or “our”) has been creating indoor golf software and hardware and are focused on both the residential and commercial golf simulation industries. We design, develop, manufacture and sell golf simulators for residential and commercial applications. We offer portable, professional, commercial and custom simulators. In addition, to bundling our software with our simulators, we offer our E6 Connect software and gaming software on a standalone basis. We have leveraged the power of our hardware and software platform to create a collection of multi-sport games including football, soccer, soccer golf, frisbee golf, zombie dodgeball, and cowboy target practice.

As described in Note 20 – Subsequent Events, on January 31, 2024, subsequent to the fiscal year ended December 31, 2023, we completed the previously announced business combination pursuant to the terms of the Business Combination Agreement, dated as of July 21, 2023, which provided for, among other things with TruGolf Nevada being the surviving corporation of the merger and having become a direct, wholly owned subsidiary of Deep Medicine Acquisition Corp. (“DMAC”), a Delaware corporation and our predecessor company (“DMAQ”) as a consequence of the merger (together with the other transactions contemplated by the Business Combination Agreement). In connection with the consummation of the Business Combination, DMAQ changed its name to TruGolf Holdings, Inc. TruGolf Holdings, Inc.’s Class A common stock commenced trading on The Nasdaq Capital Market LLC under the ticker symbol “TRUG” on February 1, 2024.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

We prepare our financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The Company’s financial statements are prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business. Continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to meets its financial requirements, raise additional capital, and the success of its future operations.

Under the rules of ASC Subtopic 205-40 “Presentation of Financial Statements-Going Concern” (“ASC 205-40”), the Company is required to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that these interim financial statements are issued or available to be issued. This evaluation takes into account the Company’s current available cash and projected cash needs over the one-year evaluation period but may not consider things beyond its control.

In 2022 and prior years, the Company has reported operating income and positive operating cash flows. However, for 2023, the Company has experienced operating losses due primarily to expensing consulting fees and issuing common stock associated with the services provided by third-party consultants related to the propose DMAC business combination (See Note 20 – Subsequent Events), used cash from operations, and relied on the capital raised from related parties and institutional financing to continue ongoing operations. We may or may not be able to raise additional capital or obtain additional institutional financing due to future economic conditions. In particular, the lending criteria are currently tightening in the United States, and we have experienced a decline in demand for our products, which are in the category of “lifestyle purchases”. These factors, when considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date these financial statements are issued. In response to these conditions, the Company’s management has prepared the following financing plan, which we believe mitigates the going concern uncertainty:

We project that we will be able to meet our debt service and other cash obligations for at least the next 12 months. Our significant projected cash commitments relate primarily to debt service and operating expenses. We anticipate the cash required to service our debt to be between $900,000 to $2,300,000. The $2,300,000 assumes (1) the convertible notes are retired by cash payment rather than conversion into our stock at maturity and (2) the note payable – ARJ Trust (See Note 10 – Related Party Notes Payable) are retired at maturity. These notes are controlled by the Company’s Chief Executive Officer and have historically been extended (13 times) in one-year increments. The Morgan Stanley margin line of credit account is 100 percent secured with the short-term investments held in the brokerage account. The Morgan Stanley margin line of credit account would be retired through liquidation of the investments. At December 31, 2023, the Company had an additional $341,544 in availability on the Morgan Stanely margin line of credit account.

Our significant projected cash requirements related primarily to operating expenses for the next 12 months include $7,000,000 to $8,000,000 for employees’ salaries, wages and benefits, $950,000 to $1,200,000 for installation and customers service, and $1,000,000 to $1,200,000 for development of software and hardware. For the year ending December 31, 2023, we spent an average of six percent of total sales on our marketing and business development efforts. For the next twelve months (through December 2024), we anticipate spending seven to nine percent of total projected sales, or $2,100,000 to $2,700,000 on marketing and business development. Upon closing the business combination, we anticipate our marketing and business development spend to be closer to fifteen percent and as high as twenty percent. Due to the timing of our sales and cash receipts, we project to generate sufficient recurring cash flow to cover our selling, general and administrative expenses each period. No assurances can be given that the results anticipated by our projections will occur. With respect to long-term liquidity requirements, approximately $7,400,000 of our debt matures in years 2025 to 2033.

In the event the projected results do not occur, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more product offerings and other strategic initiatives. Additionally, we would reduce the number of new hires planned in 2024, and implement cost reduction measures such as a reduction in headcount, reducing the planned sales and marketing expense among other cost reduction measures. We may also issue common stock to potential investors to increase our liquidity.

Management believes the plan outlined above provides an opportunity for the Company to continue as a going concern.

Use of Estimates

We prepare our financial statements in accordance with accounting principles generally accepted in the United States of America. The application of many accounting principles requires us to make assumptions, estimates and/or judgments that affect the reported amounts of assets, liabilities, revenues and expenses in our financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable under the circumstances. These assumptions, estimates and/or judgments, however, are often subjective and they and our actual results may change based on changing circumstances or changes in our analyses. If actual amounts are ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts first become known. Estimates and assumptions include collectability of our accounts receivable, net realizable value of our inventory and valuation of warrants.

Revenue Recognition

We recognize revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) standards - Topic 606 “Revenue from Contracts with Customers” (“Topic 606”). When entering into contracts with our customers, we review the following five steps of Topic 606:

	i.	Identify the contract with the customer.
	ii.	Identify the performance obligation.
	iii.	Determine the transaction price.
	iv.	Allocate the transaction price to the performance obligation.
	v.	Evaluate the satisfaction of the performance obligation.

We account for contracts, with our customers, when we have approval and commitment from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and collectability of consideration is probable.

Under Topic 606, we recognize revenue only when we satisfy a performance obligation by transferring a promised good or service to our customer and completion of all performance obligations. A good or service is considered transferred when the customer obtains control. The standard defines control as an entity’s ability to direct the use of, and obtain substantially all of the remaining benefits from, an asset. We recognize revenue once control has passed to the customer. The following indicators are evaluated in determining when control has passed to the customer:

We have a right to a payment for the product or service.

	ii.	The customer has legal title to the product.
	iii.	We have transferred physical possession of the product to the customer.
	iv.	The customer has the risk and rewards of ownership of the product.
	v.	The customer has accepted the product.

Revenue Recognition for Golf Simulators. Revenues from the sale of golf simulators are recognized with the selling price to the customer recorded as revenues and the acquisition cost of the product recorded as cost of revenues. We recognize revenue from these transactions when control has passed to the customer and the performance obligations have been satisfied. Control is considered to have passed to the customer when the simulators has been delivered, installed and accepted by the customer. Golf simulators are bundled and are comprised of both hardware and a software license (for the software to operate the simulator). Our simulator contracts with customers generally do not include multiple performance obligations.

Revenue Recognition for Content Software Subscriptions. The Company offers content software subscriptions for one and twelve months. We recognize revenue from these transactions when control has passed to the customer and the performance obligations have been satisfied. Control is considered to have passed to the customer when the software license has been delivered and accepted by the customer. The content software subscription revenue is recognized over the term of the contract.

Fair Value of Financial Instruments

Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Financial Accounting Standards Board (“FASB”) fair value measurement guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value. The three broad levels of the fair value hierarchy are as follows:

	Level 1 –	Quoted prices (unadjusted) in active markets for identical assets or liabilities,
	Level 2 –	Quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly,
	Level 3 –	Unobservable inputs for which little or no market data exists, therefore requiring a company to develop its own assumptions.

Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. We review the fair value hierarchy classification on a quarterly basis. Changes in the observable inputs may result in a reclassification of assets and liabilities within the three levels of the hierarchy outlined above.

The carrying amounts of certain financial instruments, such as cash and cash equivalents, accounts receivable, accounts payable, and derivative liability approximate fair value due to their relatively short maturities. The following table shows the Company’s cash, cash equivalents, restricted cash and marketable investment securities by significant investment category as of December 31, 2023 (As of December 31, 2022, there were no marketable investment securities):

	Adjusted Cost		Allowance for Credit Losses		Total Unrealized Gains / (Losses)							Marketable Investment Securities
Cash (including restricted cash)	$	5,342,348			$			$	5,342,348	$	5,342,348	$	-
Level 1:													-
Money market funds		55,216		-		-			55,216		55,216
Subtotal		5,397,564		-		-			5,397,564		5,397,564		-
Level 2:
Corporate fixed income securities		449,819		-		2,863			452,682		-		452,682
U.S. treasury securities		2,030,796		-		(4,525	)		2,026,271		-		2,026,271
Subtotal		2,480,615		-		(1,662	)		2,478,953		-		2,478,953
Total	$	7,878,179		-	$	(1,662	)	$	7,876,517	$	5,397,564	$	2,478,953

	December 31, 2023
	Adjusted Cost		Fair Value
Convertible notes payable (Level 3)	$	954,622	$	954,622

	December 31, 2022
	Adjusted Cost		Fair Value
Convertible notes payable (Level 3)	$	578,481	$	578,481

For our Level 3 unobservable inputs, we calculate a discount rate based on the U.S. prime rate of 10.00% and 7.75% as of December 31, 2023, and 2022, respectively.

Cash, Cash Equivalents and Restricted Cash

Cash primarily consists of cash, demand and savings deposits which are highly liquid. The Company considers highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase of three months or less to be cash equivalents. Restricted cash is balance pledged to a financial institution as collateral for a $2 million line of credit. See Note 11 – Lines of Credit. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. As of December 31, 2023 and 2022, the amount in excess of federally insured limits was $4,251,124 and $9,198,618, respectively.

Marketable Investment Securities

The Company’s marketable investment securities are comprised of investments in corporate fixed income securities and U.S. Treasury securities. The Company designates investments in debt securities as available-for-sale. Available-for-sale debt securities with original maturities of three months or less from the date of purchase are classified within cash and cash equivalents. Available-for-sale debt securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income (loss), a component of stockholders’ equity, net of tax. Realized gains and losses on the sale of marketable securities are determined using the average cost method on a first-in, first-out basis and recorded in total other income (expense), net in the statements of operations and comprehensive loss.

The available-for-sale debt securities are subject to a periodic impairment review. For investments in an unrealized loss position, the Company writes down the amortized cost basis of the investment if it is more likely than not that the Company will be required or will intend to sell the investment before recovery of its amortized cost basis. For investments not likely to be sold before recovery of the amortized cost basis, the Company determines whether a credit loss exists by considering information about the collectability of the instrument, current market conditions, and reasonable and supportable forecasts of economic conditions. The Company recognizes an allowance for credit losses up to the amount of the unrealized loss when appropriate. Allowances for credit losses and write-downs are recognized in total other income (expense), net, and unrealized losses not related to credit losses are recognized in accumulated other comprehensive loss. There are no allowances for credit losses recorded for the periods presented.

Accounts Receivable, net

We manage credit risk associated with our accounts receivables at the customer level. Because the same customers typically generate the revenues that are accounted for under both Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606) and Accounting Standards Codification Topic 326, Credit Losses (Topic 326)., the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 and Topic 326.

We believe the concentration of credit risk, with respect to our receivables, is limited because our customer base is comprised of a number of geographically diverse customers. We manage credit risk through credit approvals and other monitoring procedures.

Pursuant to Topic 326 for our accounts receivables, we maintain an allowance for doubtful accounts that reflects our estimate of our expected credit losses. Our allowance is estimated using a loss rate model based on delinquency. The estimated loss rate is based on our historical experience with specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and our own judgment as to the likelihood of ultimate payment based upon available data. We believe our credit risk is somewhat mitigated by our geographically diverse customer base and our credit evaluation procedures. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts. Based on management’s evaluation, there is a balance in the allowance for doubtful accounts of $1,227,135 and $527,136 as of December 31, 2023, and 2022, respectively.

Inventory, net

All of our inventory consists of raw materials and are valued at the lower of historic cost or net realizable value; where net realizable value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. Historic inventory costs are calculated on an average or specific cost basis. The Company records inventory write-downs for excess or obsolete inventories based upon assumptions on current and future demand forecasts. As of December 31, 2023, and 2022, the Company had $429,050 and $304,050, respectively, reserved for obsolete inventory.

Property and Equipment, net

Our property and equipment are recorded at cost and depreciated using the straight-line over the estimated useful lives. Ordinary repair and maintenance costs are included in sales, general and administrative (“SG&A”) expenses on our statements of operations. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. At the time assets are sold or disposed of, the cost and accumulated depreciation are removed from their respective accounts and the related gains or losses are reflected in the statements of operations in gains from sales of property and equipment, net.

We periodically evaluate the appropriateness of remaining depreciable lives assigned to property and equipment. Depreciation expense for the years ended December 31, 2023, and 2022 were $58,641 and $60,667, respectively. Generally, we assign the following estimated useful lives to these categories:

Category		Estimated Useful Life
Software and computer equipment		3 to 10 years
Furniture and fixtures		3 to 15 years
Vehicles		5 years
Equipment		5 to 10 years

Impairment of Long-lived Assets

Our long-lived assets principally consist of property and equipment and right-of-use assets. We review, on a regular basis, our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In reviewing for impairment, the carrying value of such assets is compared to the estimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. If such cash flows are not sufficient to support the asset’s recorded value, an impairment charge is recognized to reduce the carrying value of the asset to its estimated fair value. The determination of future cash flows as well as the estimated fair value of long-lived and intangible assets involves significant estimates and judgment on the part of management. Our estimates and assumptions may prove to be inaccurate due to factors such as changes in economic conditions, changes in our business prospects or other changing circumstances. Based on our most recently completed reviews, there were no indications of impairment associated with our long-lived assets.

Leases

Our lease portfolio is substantially comprised of operating leases related to leases for our corporate headquarters and warehouse.

We determine whether an arrangement is a lease at the inception of the arrangement based on the terms and conditions in the contract. A contract contains a lease if there is an identified asset, and we have the right to control the asset for a period of time in exchange for consideration. Lease arrangements can take several forms. Some arrangements are clearly within the scope of lease accounting, such as a real estate contract that provides an explicit contractual right to use a building for a specified period of time in exchange for consideration. However, the right to use an asset can also be conveyed through arrangements that are not leases in form, such as leases embedded within service and supply contracts. We analyze all arrangements with potential embedded leases to determine if an identified asset is present, if substantive substitution rights are present, and if the arrangement provides the customer control of the asset.

Operating lease right-of-use (“ROU”) assets represent our right to use an individual asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide the lessor’s implicit rate, we use our incremental borrowing rate (“IBR”) at the commencement date in determining the present value of lease payments by utilizing a fully collateralized rate for a fully amortizing loan with the same term as the lease.

Lease terms include options to extend the lease when it is reasonably certain those options will be exercised. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. Our leases can include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when such renewal options and/or termination options are reasonably certain of exercise.

A ROU asset is subject to the same impairment guidance as assets categorized as property and equipment. As such, any impairment loss on ROU assets is presented in the same manner as an impairment loss recognized on other long-lived assets.

A lease modification is a change to the terms and conditions of a contract that changes the scope or consideration of a lease. For example, a change to the terms and conditions to the contract that adds or terminates the right to use one or more underlying assets, or extends or shortens the contractual lease term, is a modification. Depending on facts and circumstances, a lease modification may be accounted for as either: (1) the original lease plus the lease of a separate asset(s) or (2) a modified lease. A lease will be remeasured if there are changes to the lease contract that do not give rise to a separate lease.

Cost of Revenues

Cost of revenue includes direct materials, labor, manufacturing overhead costs and reserves for estimated warranty cost (excluding depreciation). Cost of revenue also includes charges to write down the carrying value of the inventory when it exceeds its estimated net realizable value and to provide for on-hand inventories that are either obsolete or in excess of forecasted demand. As a result of the introduction new simulator products in late 2022 and the sunsetting of older hardware models, in 2023, management reviewed the inventory and recorded an additional $721,000 in inventory write-down and an additional $125,000 in allowance for obsolescence. During 2022, the Company announced upgrades to the current simulators along with the next generation of launch monitors to be available in 2023. In 2022, management reviewed the inventory and recorded a $991,429 write down and an additional $250,000 allowance for obsolescence.

Royalties

We have royalty agreements with certain software suppliers to pay royalties based on the number of units and subscriptions sold. The royalty percentages range between 20% and 30%. During 2023 and 2022, we expensed $709,640 and $550,963, respectively, to our software resell partners.

Salaries, Wages, and Benefits

Salaries, wages and benefits are expenses earned by employees and outside contractors of the Company and are expensed as incurred. Included in salaries, wages and benefits are employer payroll taxes, health, dental and life insurance costs of $397,995 and $685,144 for the years ended December 31, 2023, and 2022, respectively. Contract labor was $1,029,412 and $895,868 for the years ended December 31, 2023, and 2022, respectively. As of December 31, 2023 and 2022, we had $326,516 and $278,565, respectively, in accrued salaries, wages and benefits.

In October 2023, The Board of Directors awarded and authorized the issuance of 126 shares each of TruGolf common stock to two executives at the estimated fair value. Accordingly, the Company recorded $1,379,196 in employee stock non-cash, compensation expense.

Selling, General and Administrative

Sales and marketing costs consist primarily of installation and customer service costs, advertising through social media platforms, the creation of promotional videos for current and new products, membership industry associations, exhibiting at trade shows and other business development activities. Sales and marketing costs are expensed as incurred. For the years ended December 31, 2023, and 2022, total sales and marketing expenses were $2,597,779 and $1,727,293, respectively.

General and administrative expenses are expensed as incurred and consist primarily of the following:

	For the years ended December 31,
	2023		2022
Stock issued to consultants for services (See Note 16 – Stockholders’ Deficit)	$	4,493,333	$	-
Professional fees		905,204		932,122
Bad debt		681,479		-
License and association dues		503,914		516,477
Facilities including rent and utilities		595,337		439,717
Bank and credit card processing fees		357,535		357,533
Other general corporate related expenses		892,751		2,706,532
	$	8,429,553	$	4,952,381

Income Taxes

The Company, with stockholders’ consent, has elected to be taxed as an “S Corporation” under the provisions of the Internal Revenue Code and comparable state income tax law. As an S Corporation, we are generally not subject to corporate income taxes and our net income or loss is reported on the individual tax return of the stockholder of the Company. Therefore, no provision or liability for income taxes is reflected in the financial statements. Management has evaluated its tax positions and has concluded that the Company had taken no uncertain tax positions that could require adjustment or disclosure in the financial statements to comply with provisions set forth in ASC 740, “Income Taxes”.

Income (Loss) Per Share

Net income (loss) per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. Basic net income (loss) per common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued, unless doing so is anti-dilutive. The weighted-average number of common shares outstanding for computing basic EPS for the years ended December 31, 2023 and 2022, were 11,994 and 11,308, respectively. Diluted net loss per share of common stock is the same as basic net loss per share of common stock because the effects of potentially dilutive securities are antidilutive.

Potentially dilutive securities as of December 31, 2023, included warrants to purchase 292 shares of commons stock and 140 common shares for the convertible debt. Potentially dilutive securities as of December 31, 2022, included warrants to purchase 292 shares of commons stock and 94 common shares for the convertible debt.

Recent Accounting Pronouncements Not Yet Adopted

Management has evaluated all recent accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) and determined that none of the pronouncements will have a material impact on our financial statements. We will continue to monitor the issuance of any new accounting pronouncements and assess their potential impact on the financial statements in future periods.

Concentration of Credit and Supplier Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash deposits and trade accounts receivable. Credit risk can be negatively impacted by adverse changes in the economy or by disruptions in the credit markets.

We maintain our cash deposits with established commercial banks. At times, balances may exceed federally insured limits. We have not experienced any losses in such accounts and do not believe that we are exposed to any significant credit risk associated with our cash deposits.

We believe that credit risk with respect to trade accounts receivable is somewhat mitigated by our large number of geographically diverse customers and our credit evaluation procedures. We record trade accounts receivables at sales value and establish specific reserves for certain customer accounts identified as known collection problems due to insolvency, disputes or other collection issues. The amounts of the specific reserves estimated by management are determined by a loss rate model based on delinquency. We maintain reserves for potential losses. For each of the years ended December 31, 2023, and 2022, no one customer accounted for more than 10% of our revenues.

We purchase a significant number of parts we consume in manufacturing our simulators from nationally known original equipment manufacturers, many of whom we have had over a 10 to 15 years relationship. While we do not have long-term contracts, we do issue purchase orders based on quoted prices terms. During the year ended December 31, 2023 we purchased approximately 52.9% of our assembly parts from five manufacturers. During the year ended December 31, 2022, we purchased approximately 50.0% of our assembly parts from three manufacturers. We believe that while there are alternative suppliers, for the parts and equipment, we purchase in each of the principal product categories, termination of one or more of our relationships with any of our major suppliers of equipment could have a material adverse effect on our business.

Warrants

The fair value of the warrants is estimated on the date of issuance using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including the expected term of the warrants, expected stock price volatility, and expected dividends. These estimates involve inherent uncertainties and the application of management’s judgment. Expected volatilities used in the valuation model are based on the average volatility of the comparable companies publicly traded on recognized stock exchanges. The risk-free rate for the expected term of the option is based on the United States Treasury yield curve in effect at the time of grant.

3.	ACCOUNTS RECEIVABLE, NET

Accounts receivable and allowance for doubtful accounts consisted of the following as of December 31:

	2023			2022
Trade accounts receivable	$	3,458,625		$	2,140,853
Other		167,383			130,920
		3,593,625			2,271,773
Less allowance for doubtful accounts		(1,227,136	)		(527,136	)
Total accounts receivable, net	$	2,398,872		$	1,744,637

Accounts receivable as of December 31, 2023, and 2022 are primarily made up of trade receivables due from customers in the ordinary course of business. Four customers accounted for more than 51.5% of the balance of accounts receivable as of December 31, 2023, and five customers accounted for 57% of the accounts receivable balance as of December 31, 2022.

4.	INVENTORY, NET

The following summarizes inventory as of December 31:

	2023			2022
Inventory – raw materials	$	2,548,134		$	2,425,530
Less reserve allowance for obsolescence		(429,050	)		(304,050	)
Inventory, net	$	2,119,084		$	2,121,480

5.	MARKETABLE INVESTMENT SECURITIES

In February 2023, we entered into a brokerage agreement and deposited $2,500,000. During 2023, we purchased $450,751 in corporate fixed income securities (corporate bonds) and $2,042,384 in government securities (Treasury securities). During 2023, no investments were sold nor matured. See Note 1 – Summary of Significant Accounting Policies for a discussion of our investment policies, accounting for investments and summary of fair value of financial instruments. As of December 31, 2023, the marketable investment securities consisted of the following:

Corporate fixed income securities, weighted average yield and maturity of 5.39% and 2.38 years, respectively		452,682
Government securities, weighted average yield and maturity of 4.91% and 3.25 years, respectively		2,026,271
Total marketable investment securities	$	2,478,953

There were no marketable investment securities in 2022.

6.	OTHER LONG-TERM ASSETS

The following summarizes other long-term assets as of December 31, 2023 (there were no long-term assets as of December 31, 2022):

Security deposit – Ethos Management loan	$	1,875,000
Security deposits – leased facilities		30,983
Other long-term assets	$	1,905,983

As discussed in Note 9 – Notes Payable and Note 20 – Subsequent Events, as a condition of funding on the Ethos Management loan, we placed a $1,875,000 security deposit as collateral for the note. Deposits related to the facility leases are generally the last month’s payments.

7.	PROPERTY AND EQUIPMENT, NET

The following summarizes property and equipment as of December 31:

	2023			2022
Software and computer equipment	$	809,031		$	694,560
Furniture and fixtures		230,883			217,943
Vehicles		59,545			59,545
Equipment		15,873			15,873
		1,115,332			987,921
Less accumulated depreciation		(881,024	)		(822,385	)
Property and equipment, net	$	234,308		$	165,536

Depreciation expense for the years ended December 31, 2023, and 2022, was $58,641 and $60,667, respectively.

8.	CUSTOMER DEPOSITS

Customer deposits are advance payments from customers prior to manufacturing and shipping a simulator. The prepayment amounts and timing vary depending on the product to be manufactured and delivery location. Customer deposits are included in current liabilities until the balance is applied to an order at the time of invoicing. As of December 31, 2023, and 2022, customer deposits were $1,704,224 and $2,712,520, respectively.

9.	NOTES PAYABLE

Notes payable consisted of the following as of December 31:

	2023			2022
Note payable – Ethos Management INC	$	2,499,999		$	-
Note payable - JPMorgan Chase		-			349,830
Note payable – Mercedes-Benz		29,149			38,017
Note payable – Zions Bank		-			5,984
		2,529,148			393,831
Less deferred loan fees – Ethos Management INC		(116,940	)		-
Less current portion		(9,425	)		(105,213	)
Long-term portion	$	2,402,783		$	288,618

Future maturities of notes payable are as follows for the years ending December 31:

2024	$	9,425
2025		10,001
2026		9,723
2027		1,111,111
2028		1,111,111
Thereafter		277,777
Total	$	2,529,148

The deferred loan fees are being amortized over the term of the Ethos Management note payable.

Note Payable – Ethos Management INC

In January 2023, we entered into a financing agreement with Ethos Asset Management INC (the “Ethos Asset Management Loan” or “Ethos”) in the principal amount of up to $10 million. Pursuant to the terms of the Ethos Asset Management Loan, we may draw down financing proceeds equal to $833,333 each month beginning in April 2023, up to the $10 million amount. Interest associated with the Ethos Asset Management Loan is fixed at 4% per annum and has a three-year grace period for principal and interest payments. Annual principal ($1,111,111) plus interest payments will commence in 2027 and may continue through 2034 depending on the total amount drawn on the loan. As a condition to funding, we provided Ethos Management with a $1,875,000 deposit as collateral for the note. Ethos Management informed the Company in August 2023, that unrelated to TruGolf, Ethos Management is currently undergoing a routine audit of its loan portfolio, and pending the close of the audit, borrowers may experience delays in drawing on funds when requested. See Note 20 – Subsequent Events.

Note Payable – JP Morgan Chase

In June 2021, we entered into a $500,000, 3.00% annual interest rate note payable with JPMorgan Chase Bank, N.A. (“JP Morgan”). The note matures on June 8, 2026. We make a monthly principal and interest payment in the amount of $8,994. There is no prepayment penalty if the loan is paid prior to the maturity date.

In December 2023, we entered into a one-year line of credit facility with JP Morgan. See Note 11 – Lines of Credit. The outstanding note payable balance of $257,113 was transferred to the new line of credit.

Note Payable – Mercedes-Benz

In November 2020, we entered into a $59,545, 5.90% annual interest rate note payable with Mercedes-Benz for a delivery van. The note matures on November 20, 2026, and is secured by the van. We make a monthly payment of $908.

Note Payable – Zions Bank

In April 2018, we entered into a $77,067, 6.75% annual interest rate note payable with Zion Bank, N.A. The note matures on April 16, 2023, and is guaranteed by the Company’s chief executive officer. We make a monthly payment of $1,517. The note was paid off in 2023.

10.

RELATED PARTY NOTES PAYABLE

Related party notes payable consisted of the following as of December 31:

	2023			2022
Notes payable - ARJ Trust	$	650,000		$	650,000
Note payable - McKettrick		1,300,000			1,250,000
Note payable - Carver		148,000			185,000
		2,098,000			2,085,000
Less current portion		(1,237,000	)		(937,000	)
Long-term portion	$	861,000		$	1,148,000

Future maturities of related party notes payable are as follows for the years ending December 31:

2024	$	1,237,000
2025		287,000
2026		287,000
2027		287,000
Total	$	2,098,000

Note Payable – ARJ Trust

In December 2008, we entered into a $500,000, 8.50% annual interest rate note payable with a trust (“ARJ Trust”) indirectly controlled by the chief executive officer. We make monthly interest-only payments of $3,541. As of December 31, 2023, and 2022, the principal balance outstanding was $500,000 and accrued interest was $2,911. During 2023, the note’s maturity was extended one-year to March 31, 2024. In March 2024, the note’s maturity was extended to March 31, 2025.

In June 2010, we entered into a second $150,000, 8.50% annual interest rate note payable with the ARJ Trust. We make monthly interest-only payments of $1,063. As of December 31, 2023, and 2022, the principal balance outstanding was $150,000 and accrued interest was $873. During 2023, the note’s maturity was extended one-year to March 31, 2024. In March 2024, the note’s maturity was extended to March 31, 2025.

The trustee of the ARJ Trust is a related party to the Company’s chief executive officer.

Note Payable – McKettrick

In May 2019, we entered into a $1,750,000, zero interest rate note payable with a former shareholder to repurchase all shares in the Company. The note is payable in annual installments of $250,000 due on December 21 of each year. The note matures on December 1, 2027. There is a late fee of 5%, if not paid within 10 days of the due date. In December 2023, the shareholder agreed to extend the December 21, 2023 payment to February 1, 2024, for a $50,000 fee.

Note Payable – Carver

In January 2021, we entered into a $222,000, zero interest rate note payable with a former shareholder to repurchase all shares in the Company. The note is payable in semi- annual installments of $18,500 due on March 31 and September 30 each year and matures on October 1, 2027.

11.

LINES OF CREDIT

The new line of credit is secured by a pledge of $2,100,000 in the Company’s deposit accounts (restricted cash) at JP Morgan Chase. As of December 31, 2023 the balance outstanding on the new line of credit was $802,738 and $1,197,262 in additional available borrowings. As of December 31, 2022, the balance outstanding on the earlier line of credit was $545,625.

During February 2023, the Company entered into a variable rate line of credit with Morgan Stanley which is secured by the marketable securities held in our brokerage account. As of December 31, 2023, the balance outstanding was $1,980,937, at a rate of 7.21%. As of December 31, 2023, there was approximately $341,544 in available borrowings.

12.

CONVERTIBLE NOTES PAYABLE

In May 2022, we entered into two separate but identical $300,000 (total $600,000), 10.00% annual interest rate convertible notes payable (“Convertible Notes”) with two individual consultants (“Note Holder”) to assist with services including an initial public offering preparation and listing to NASDAQ or other national exchange, assist the Company and its counsel in preparing a code of conduct and employment agreements, franchise development, and valuation increase through growth among other services. The original terms of each note include a 15% original issue discount (“OID”), 292 warrants, no prepayment penalty and a maturity of February 25, 2023.

The warrants are exercisable at $4,800 per share for five years and a cashless option and a mandatory exercise over $9,600 with no prepayment penalty. The warrants are non-exercisable for one year from issuance. The valuation assumptions used in the Black-Sholes model to determine the fair value of each warrant awarded in 2022: expected stock price volatility ranged from 40.06% to 80.17%; expected term in years 5.00 with a discount for the one-year lockout period; and risk-free interest rate 2.95%.

The Note Holder has the right, at any time on or after the issuance date and prior to the maturity date, to convert all or any portion of the then outstanding and unpaid principal plus any accrued interest thereon into shares of the Company’s common stock. The per share conversion price will be convertible into shares of common stock equal to 70% multiplied by the lower of (i) the volume weighted average of the closing sales price of the common stock on the date that the Company’s listing on the NASDAQ Global Market or other national exchange (“Uplisting”) is successfully consummated or (ii) the lowest closing price for the five trading days following the date of Uplisting, not including the Uplisting day.

In the event the Company (i) makes a public announcement that it intends to be acquired by, consolidate or merge with any other corporation or entity (other than a merger in which the Company is the surviving or continuing corporation and its capital stock is unchanged) or sell or transfer all or substantially all of the assets of the Company; or (ii) any person, group or entity (including the Company) publicly announces a tender offer to purchase 50% or more of the common stock, then the conversion price will be equal to the lower of the conversion price and a 25% discount to the announced acquisition provided, that, the conversion will never be less than a price that is the lower of (iii) the closing price (as reflected on Nasdaq.com) immediately preceding the signing of these notes; or (iv) the average closing price of the Company’s common stock (as reflected on Nasdaq.com) for the five trading days immediately preceding the signing of these notes.

In 2022 and at the time off issuance, the Company elected to follow the relative fair value method to allocate the proceeds to the warrants, OID, and convertible notes (collectively the “Financial Instruments”). Total estimated fair value (based on an independent valuation of the business) of the Financial Instruments was $1,387,060. The pro-rata allocation of the $450,000 total proceeds was $282,109 to the warrants, $21,899 to the OID and $145,992 to the convertible notes. The fair value of the warrants exceeded the pro-rata allocation of proceeds to the warrants and the convertible notes by $445,032, which the Company recorded as interest expense at the time of issuance.

Based on an estimated 70% discounted conversion price, the Company recorded $192,857 in interest expense and a corresponding increase in the notes payable. The Company has elected to account for the convertible notes at fair market value. The fair market value will be adjusted at each reporting period. The total outstanding balance for each convertible note as of December 31, 2022, was $225,000 (total $450,000) and accrued interest was $16,480. In March 2023, we extended each note’s maturity to July 31, 2023 and increased each note’s borrowing limit to $375,000.

In July 2023, the Company and Convertible Note Holders entered into Warrant Cancellation Agreements, whereby the warrants will be cancelled if and when the business combination with Deep Medicine Acquisition Corp. (See Note 1 – Organization and Nature of Operations and Note 20 – Subsequent Events). If the merger is not closed, the warrants will remain outstanding. Also in July 2023, the convertible notes were modified whereby the maturity date was extended by up to an additional eight months (February 29, 2024), to be in two extensions of four months each. Five days prior to the extension deadline the Company will issue 9,000 shares (total 18,000 shares if the Company elects the two extensions) of the Company’s stock. While the Company did elect the extension, the stock will be issued in shares post business combination with DMAC.

During 2022, we recorded $304,388, in gross OID based on the borrowings on the Convertible Notes. During 2022, we recorded OID amortization of $240,048, in interest expense. There $64,368 remaining OID as of December 31, 2022.

During 2023, we borrowed and additional $185,000 and recorded $32,735 in gross OID. Based on the additional borrowings, the fair value of the warrants exceeded the pro-rata allocation of proceeds to the warrants and the convertible notes by $93,530, which the Company recorded as interest expense at the time of issuance. During 2023, we recorded OID amortization of $97,111 in interest expense. There was zero OID remaining as of December 31, 2023. As of December 31, 2024, the fair value of the convertible notes was remeasured and the balance outstanding was $954,622 and $81,765 was available to be borrowed.

13.

DIVIDEND NOTES PAYABLE

We file our tax returns as an S Corporation. Historically, all income tax liabilities and benefits of the Company are passed through to the shareholders annually through distributions. No dividends were declared during 2023 or 2022. During 2023, the Company did not make any payments to the shareholders. During 2022, the Company paid the shareholders $1,965,706. In November 2022, each shareholder agreed to defer the accrued dividends payable by entering into 6.00% interest rate dividend notes payable. All outstanding and accrued interest is due and payable when the dividend notes payable mature on December 31, 2025. Interest commenced accruing on January 1, 2023.

In anticipation of the business combination with DMAC and effective December 31, 2023, certain shareholders converted a portion of their notes payable ($3,925,273) and accrued interest ($248,262) into the Company’s common stock. Total shares of common stock issued in connect with the conversion was 717 share based on the fair value of common stock at the time of conversion. See Note 16 – Stockholders’ Deficit.

Dividends declared, distributed, and accrued are as follow as of December 31:

	2023		2022
Distributions payments for tax liabilities	$	-	$	1,965,706
Dividends payable	$	4,023,923	$	7,660,784

14.

GROSS SALES ROYALTY PAYABLE

In June 2015, we entered into a Royalty Purchase Agreement (the “Agreement”) with a purchaser (“Purchaser”) for a gross sales royalty. The Purchaser agreed to purchase a sales royalty for the sum of $1,000,000 plus applicable taxes. Upon mutual agreement the Purchaser may purchase one or more additional royalties in an aggregate amount of up to $1,000,000. For the period June 2015 through May 2017, the Company paid a monthly payment of $20,833. Effective June 1, 2017 and all subsequent months, the monthly royalty payment has been equal to the greater of $20,833 plus the amount determined in accordance with the following and of June 1, 2017:

	i.	If the trailing twelve-month revenue of the Company is equal to or less than $6,110,000, 3.60% of our monthly revenues, in perpetuity (unless terminated in accordance with the Purchase Agreement);
	ii.	If trailing twelve-month revenue of the Company is equal to or greater than $17,200,000, 1.30% of our monthly revenues, in perpetuity (unless terminated in accordance with the Purchase Agreement); or
	iii.	If trailing twelve-month revenue of the Company is greater than $6,110,000 but less than $17,200,000, such percentage of monthly revenue determined by dividing $220,060 by the amount of trailing twelve-month revenue and multiplying the result by 100, in perpetuity (unless terminated in accordance with the Purchase Agreement).

The royalty percentage was fixed at 3.6% based on the trailing twelve-month revenue at the time of executing the Agreement (June 15, 2015). On June 1, 2017, the royalty percentage was changed to 2.4% based on the trailing 12-month revenues at that time as outlined in the table above.

The Agreement contains an option for a one-time buy down of the royalty rate. At any time following the date on which the Purchaser has received royalty payments that are, in the aggregate, equal to two times the then applicable Aggregate Installment Amount ($1,000,000), we may purchase and extinguish 75% (but no more nor less) of all amounts owing or to become owing to the Purchaser hereunder. In the event we want to exercise the buy down option, we would pay the Purchaser $750,000 (75% of the $1,000,000 outstanding amount). The adjusted royalty rate going forward would then be 0.6% (75% of the 2.4%).

The Agreement also contains an option for a buyout upon the change of control. If pursuant to a proposed change of control the acquirer under such transaction requires, as a condition to the completion of such transaction, that the Company purchase and extinguish all amounts owing or to become owing to the Purchaser hereunder, the Company will pay the greater of:

	i.	An amount equal to two times the aggregate installment amount as at the date of the change of control buyout notice; and
	ii.	An amount equal to A multiplied by B multiplied by C, where:

	a.	A is equal to the aggregate installment amount as at the date of the change of control divided by $22,500,000;
	b.	B is equal to 0.8; and
	c.	C is equal to the net equity value of the Company; or in the case of a proposed asset sale, the proposed net purchase price of all or substantially all of the Company’s assets.

In the event the Company were required to buyout the Agreement as a condition of closing the proposed DMAC acquisition (which currently is not a condition) (See Note 20 – Subsequent Events), the Company would pay Purchaser $2,844,444.

The Agreement has neither a stated maturity nor an interest rate. While the royalty percentage can be reduced via a buydown, as previously explained, the only avenue for terminating the Agreement is a buyout required by an acquirer in a change of control transaction. Absent the change of control, the Agreement will survive in perpetuity at a royalty rate of 2.4% or 0.6% depending on whether or not the royalty rate buydown option has been exercised.

Because the gross sales royalty payable has no stated fixed interest nor maturity, it is considered variable interest perpetual debt. The periodic variable payments to the Purchaser are recorded in interest expense. As of December 31, 2023, and 2022, the amount outstanding was $1,000,000. During 2023 and 2022, we paid $601,064 and $517,191, respectively, in interest expense to the Purchaser.

15.

ACCRUED AND OTHER CURRENT LIABILITIES

Accrued and other current liabilities consisted of the following as of December 31:

	2023		2022
Accrued payroll	$	326,515	$	278,565
Credit cards		240,989		191,244
Warranty reserve		140,000		140,000
Sales tax payable		43,891		40,545
Other		374,100		100,322
Accrued and other current liabilities	$	1,125,495	$	750,676

16.

STOCKHOLDEERS’ DEFICIT

In April 2022, we secured the services of two consultants (also the Note Holders as described in Note 12 – Convertible Notes Payable) to assist with services including assisting the Company and its counsel in an initial public offering preparation and listing to NASDAQ or other national exchange, assist the Company and its counsel in preparing a code of conduct and employment agreements, franchise development, and valuation increase through growth among other services.

Once services are performed, the first consultant will be provided a 3% stock grant; while the second consultant will be provided up to 7% of stock based on performance deliverables including: 1.75% on consummation of an initial bridge loan agreement, 1.75% on engaging an investment banker, 1.75% upon filing an S-1 including financial statements and footnotes, and 1.75% upon the closing of an initial public offering. The second consultant will be provided warrants at a 20% discount to the then current price per share, for up to 2% for achieving a $250 million valuation and 3% more for a $500 million valuation, as well as another 2% for opening the first franchise location, and 3% more once 100 franchise locations have been sold.

In March 2023, the Board of Directors authorized the issuance of 821 shares of common stock to the consultants for the services performed related as outlined in the services agreements. The common shares were issued at fair value and $4,493,333 was expensed to consulting services.

In October 2023, the Board of Directors authorized the issuance of 252 shares of common stock to two executives as compensation. The common shares were issued at fair value and $1,379,193 was expensed to salaries, wages and benefits.

In anticipation of the business combination with DMAC and effective December 31, 2023, certain shareholders converted a portion of their notes payable ($3,677,011) and accrued interest ($248,262) into the Company’s common stock. Total shares of common stock issued in connection with the conversion was 717 shares based on the fair value of common stock at the time of conversion. See Note 13 – Dividend Notes Payable.

17.

INCOME TAXES

The Company is an S Corporation for federal and state income tax purposes with all income tax liabilities and/or benefits of the Company being passed through to the stockholders. As such, no recognition of federal or state income taxes for the Company has been provided for in the accompanying financial statements. Any uncertain tax position taken by the stockholders on their individual returns is not an uncertain position of the Company.

We have adopted the provisions of ASC 740-10-25, which provide recognition criteria and a related measurement model for uncertain tax positions taken or expected to be taken in income tax returns. ASC 740-10-25 requires that a position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not that the position would be sustained upon examination by tax authorities.

Tax positions that meet the more likely than not threshold are then measured using a probability weighted approach recognizing the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement. The Company had no tax positions relating to open income tax returns that were considered to be uncertain as of December 31, 2022.

18.

COMMITMENTS AND CONTINGENCIES

Operating Leases

As of December 31, 2023, we had two operating leases as follows:

	●	In June 2023, we entered into a new five-year lease on a warehouse in North Salt Lake City, Utah. The base monthly lease payment through May 2024 is $10,849, $11,163 through May 2025, $11,486 through May 2026, $11,819 through May 2027, and $12,162 through May 2028. As of December 31, 2023, we had 53 months remaining on the lease.

	●	In December 2022, we entered into a new three-year lease on the corporate headquarters in Centerville, Utah. The base monthly lease payment through November 2023 is $20,343, $20,378 through November 2023 and $24,616 through November 2025. As of December 31, 2023, we had 42 months remaining on the lease.

We utilize our incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable. For 2023 and 2022, we used an estimated incremental borrowing rate of 10.00% and 5.90% respectively, to determine the present value of the lease liability.

Other information related to our operating leases is as follows:

Right of use asset:

As of December 31, 2021	$	162,256
Amortization		(165,535	)
Addition for corporate headquarter lease		736,156
As of December 31, 2022		732,877
Amortization		(298,209	)
Addition for warehouse lease		537,995
As of December 31, 2023	$	972,663

Lease liability:

As of December 31, 2021	$	166,291
Payments		(168,110	)
Addition for corporate headquarter lease		736,156
As of December 31, 2022		734,337
Payments		(269,849	)
Addition for warehouse lease		537,995
Lease liability – December 31, 2023	$	1,002,483

The table below reconciles the fixed component of the undiscounted cash flows for each of five years to the lease liabilities recorded on the Balance Sheet as of December 31, 2023:

Year	Minimum Lease Payments
2024	$	403,159
2025		406,990
2026		140,163
2027		144,227
2028		60,809
Total		1,155,348
Less interest		(152,864	)
Present value of future minimum lease payments		1,002,483
Less current portion		(334,255	)
Long term lease liability	$	668,228

19.

RELATED PARTY

As described in Note 13 – Dividend Notes Payable, the following were outstanding on the dividend notes payable to our officers and shareholders as of December 31, 2023, and 2022:

	2023		2022
Chief executive officer, Director and Shareholder	$	1,639,240	$	3,278,479
Chief hardware officer, Director and Shareholder		786,976		1,576,952
Executive vice president, Director and Shareholder		817,457		1,591,952
Interim chief financial officer, Director and Shareholder		198,519		397,038

The Company’s chief executive officer is related to certain lenders of the Company as discussed in Note 10 – Related Party Notes Payable.

20.

SUBSEQUENT EVENTS

We evaluate events and transactions occurring subsequent to the date of the financial statements for matters requiring recognition or disclosure in the financial statements. The accompanying financial statements consider events through April 17, 2024, the date at which the financial statements were available to be issued.

Business Combination

On November 2, 2023 and December 7, 2023, Deep Medicine Acquisition Corp. (“DMAC”) executed loan agreements with certain accredited investors (together, the “Prior Loan Agreements”) pursuant to which such investors agreed to loan DMAC up to an aggregate $11,000,000 in exchange for the issuance of convertible notes and warrants. On February 2, 2024, TruGolf Holdings, Inc. (“TruGolf Holdings”) executed a securities purchase agreement (the “Purchase Agreement”) with each of the investors that executed the Prior Loan Agreements, which replaced, in their entirety, the Prior Loan Agreements, and with additional investors (together, the “PIPE Investors”). Pursuant to the terms and conditions of the Purchase Agreement, the PIPE Investors agreed to purchase from the TruGolf Holdings (i) senior convertible notes in the aggregate principal amount of up to $15,500,000 (the “PIPE Convertible Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class A common stock (the “Series A Warrants”); and (iii) Series B warrants to initially purchase 1,550,000 shares of the TruGolf Holdings’ Class A common stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”) (the “PIPE Financing”).

The Purchase Agreement contemplates funding of the investment (the “Investment”) across multiple tranches. At the first closing (the “Initial Closing”) an aggregate principal amount of $4,650,000 of PIPE Convertible Notes will be issued upon the satisfaction of certain customary closing conditions in exchange for aggregate gross proceeds of $4,185,000, representing an original issue discount of 10%. On such date (the “Initial Closing Date”), TruGolf Holdings will also issue the PIPE Investors the Series A Warrants and the Series B Warrants.

Subject to satisfying the conditions discussed below, TruGolf Holdings, Inc. has the right under the Purchase Agreement, but not the obligation, to require that the PIPE Investors purchase additional Notes at up to two additional closings. Upon notice at any time after the 2nd trading day following the Initial Closing Date, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate principal amount of $4,650,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $4,185,000, if (i) the Registration Statement (as described below) has been filed; and (ii) certain customary closing conditions are satisfied (the “First Mandatory Additional Closing”). Upon notice at any time after the 2nd trading day following the date that the First Mandatory Additional Closing is consummated, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate principal amount of $6,200,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $5,580,000, if (i) the shareholder approval is obtained (as described below); (ii) the Registration Statement has been declared effective by the SEC; and (iii) certain customary closing conditions are satisfied (the “Second Mandatory Additional Closing”).

In addition, pursuant to the Purchase Agreement, each PIPE Investor has the right, but not the obligation, to require that, upon notice, TruGolf Holdings sell to such PIPE Investor at one or more additional closings such PIPE Investor’s pro rata share of up to a maximum aggregate principal amount of $10,850,000 in additional PIPE Convertible Notes (each such additional closing, an “Additional Optional Closing”); provided that, the principal amount of the additional PIPE Convertible Notes issued at each Additional Optional Closing must equal at least $250,000. If a PIPE Investor has not elected to effect an Additional Optional Closing on or prior to August 2, 2024, such PIPE Investor shall have no further right to effect an Additional Optional Closing under the Purchase Agreement.

On January 31, 2024, the Company issued a press release announcing that on January 31, 2024, it consummated the business combination (the “Closing”) contemplated by the previously announced Amended and Restated Agreement and Plan of Merger, dated as of July 21, 2023 (as amended, the “Merger Agreement”), by and among the Company, DMAC Merger Sub Inc., a Nevada corporation and a wholly-owned subsidiary of the Company (“Merger Sub”), Bright Vision Sponsor LLC, a Delaware limited liability company, in the capacity as the Purchaser Representative thereunder, Christopher Jones, in the capacity as the Seller Representative thereunder, and TruGolf, Inc., a Nevada corporation (“TruGolf”). As a result of the Closing and the transactions contemplated by the Merger Agreement, (i) Merger Sub merged with and into TruGolf (the “Merger”), with TruGolf surviving the Merger as a wholly-owned subsidiary of the Company, and (ii) the Company’s name was changed from Deep Medicine Acquisition Corp. to TruGolf Holdings, Inc. The Company’s Class A common stock commenced trading on the Nasdaq Global Market LLC under the ticker symbol “TRUG” on February 1, 2024.

Ethos Management INC

The Ethos Asset Management Loan Agreement (“Loan Agreement”) stipulates that fundings should happen approximately every 30 banking days, subject to Ethos completing periodic internal audits to ensure the Company was in compliance with the terms of loan agreement. Ethos Management informed the Company in August 2023, that unrelated to TruGolf, Ethos Management is currently undergoing a routine audit of its loan portfolio, and pending the close of the audit, borrowers may experience delays in drawing on funds when requested. Due to the lack of additional fundings and in accordance with the terms of the Loan Agreement, in February 2024, we sent Ethos a notice of termination for materially breaching the Loan Agreement. Based on the termination for default clause in the Loan Agreement, we are entitled to retain all the funds disbursed by Ethos and Ethos must release the deposit collateral.

Convertible Notes

The convertible notes matured on February 20, 2024. On April 9, 2024, one of the note holders, sent a demand letter requesting payment, as the note was in default status for nonpayment. Total principal and accrued interest outstanding as of February 29, 2024 was $668,235 and $83,599, respectively. The Company is working with each note holder to determine the amount due each of them. In the event of default, the note holder may declare all or any portion of the unpaid principal and interest immediately due, charge a late charge equal to 10% percent of any unpaid principal and interest, and charge 18% in interest. The note holder may elect to take shares of the Company’s stock in lieu of a cash payment.

Franchise Agreement

In February 2024, we entered into an agreement with Franchise Well, LLC, a franchising consultancy firm, to accelerate our global expansion through a regional developer franchise model. This relationship is pivotal for TruGolf as the power of franchising will amplify our global presence and cater to the growing demand for off-course golf experiences.

Marketable Investment Securities

In March 2024, we sold our marketable security investments and paid off the margin line of credit account.

mlSpatial Definitive Agreement

In March 2024, we entered into a definitive agreement with mlSpatial, a leading AI and machine learning engineering company, to license the AI engine they co-developed to increase 9-axis spin accuracy for TruGolf’s acclaimed new APOGEE launch monitor. The agreement gives TruGolf the first right of refusal to purchase 100% of mlSpatial assets.

Exhibit 99.2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations with our audited financial statements for the years ended December 31, 2023 and 2022, together with related notes thereto. The discussion and the analysis should also be read together with the section entitled “Business” and for the years ended December 31, 2023 and 2022 included elsewhere in this prospectus. The following discussion contains forward-looking statements based upon current expectations that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under the section titled “Risk factors” or in other parts of this document and our other filings with the SEC. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. In this section, unless otherwise specified, the terms “we”, “our”, “us”, the “Company” and “TruGolf” refer to TrueGolf Nevada. All dollar amounts are expressed in thousands of United States dollars (“$”), unless otherwise indicated.

Company Overview

Since 1983, TruGolf Nevada has been passionate about driving the golf industry with innovative, indoor golf solutions. We build products that capture the spirit of golf. Our mission is to help grow the game by making it more available, more approachable and more affordable, through technology – because we believe golf is for everyone.

Our team has built award-winning video games (including Links, a popular sports game for PC), , innovative hardware solutions, and an all-new e-sports platform to connect golfers around the world with TruGolf E6 Connect Software, our premier software engine. Since TruGolf Nevada’s beginning, we have continued to define and redefine what is possible with golf technology.

In addition to offering a variety of custom, professional, and portable golf simulators, TruGolf Nevada’s latest launch monitor, Apogee, was created to improve accuracy and to make using the launch monitor easier. Features of Apogee include: a unique Apogee Voice Assistant, a voice command system that allows users to navigate their TruGolf E6 Connect Software gameplay within rounds and practice sessions; Laser Launchpad, a laser indicator that shows users where to place the ball and when the system is ready to record a swing and Point-of-Impact (POI) slow-motion replay video.

Our suite of hardware offerings in the golf technology space is expansive, offering something for virtually everyone from gamers to beginners to professionals, and all consumers in between. Hardware offerings are sold through a global network of authorized resellers, retail outlets and direct-to-consumer through a dedicated TruGolf Nevada sales team. Our suite of hardware offerings range from entry level pricing at just under $400, to well over $100,000 for custom projects, creating a wide range of pricing options for nearly all consumers, and providing TruGolf Nevada with a competitive advantage in creating a wide consumer base as compared to its competitors (who often only focus in a narrow consumer price range).

TruGolf Nevada creates top golf technology software in the marketplace through its TruGolf E6 Connect Software. Importantly, TruGolf E6 Connect Software is designed not only for use with our suite of hardware offerings in the golf technology space, but also integrates with more than twenty-four third party golf technology hardware manufacturers, translating to a staggering market integration coverage equal to roughly 90% of golf technology hardware in the global market space, which allows peer-to-peer play across these golf technology hardware manufacturers, allowing for a unification of the golf technology space. TruGolf E6 Connect Software records, on average, over 725,000 indoor golf shots per day. TruGolf E6 Connect Software is both PC and iOS compatible and can be used both indoors and outdoors.

TruGolf Nevada has leveraged its unique position as one of the industry leaders in both hardware and software golf technology solutions to organize and found the Virtual Golf Association (VGA). The VGA is a gamified virtual economy that takes place inside the TruGolf E6 Connect Software. Users have a chance to earn points through play, practice, and more – providing a worldwide leaderboard of connected indoor golfers. Each shot users take rewards them with points. These points can be used to purchase in-game enhancements, or to enter virtual golf tournaments with real world prizes. The VGA is broken into three models:

●	Game Analysis – rewards TruGolf E6 Connect Software users who track and measure their game. Users can set specific goals (e.g., shots hit per month, speed and distance gains, dispersion reduction) and earn points for hitting milestones. At the end of each month, users can see how they compared against all other users utilizing the Game Analysis features.

●	Connected Golf – rewards users for joining with their friends and playing golf online. Earn points for playing a new course or linking up to play nine holes with another player utilizing TruGolf E6 Connect Software.

●	Virtual Golf Association Events – events are worldwide leaderboard format, flighted by handicap, where users play and compete to shoot the lowest score. These contests include stroke play, closest to the pin, match play, stableford, and more. Users earn points based on how they finish in their division.

In totality, TruGolf Nevada’s business model is designed to be positioned as the hub of golf technology, with groundbreaking hardware technologies that we believe can become the industry standard and unifying the industry as a whole by serving as the leader of golf technology software solutions through its TruGolf E6 Connect Software.

Recent Developments

Business Combination

Ethos Management INC

Global Franchising Agreement

In March 2023, we announced a strategic partnership with Franchise Well, a renowned franchising consultancy firm, to accelerate its global expansion through a regional developer franchise model. This partnership marks a pivotal moment for TruGolf as it harnesses the power of franchising to amplify its global presence and cater to the burgeoning demand for immersive off-course golf experiences.

The collaboration with Franchise Well will propel TruGolf’s growth strategy forward through the regional developer franchise model, targeting seasoned franchise owners to spearhead expansion. Unlike traditional franchising models aimed at individual investors, TruGolf’s approach focuses on empowering developers to build and scale territories, ensuring rapid strategic market penetration and sustainable growth.

mLSpatial Definitive Agreement

Industry Update

We note that the simulator/screen golf market is growing according to the National Golf Foundation (www.ngf.org/simulator-golf-sees-real-surge), “An estimated 6.2 million Americans hit golf balls with a club in a golf simulator within the past year, a total that surged 73% compared to pre-pandemic levels. Golf’s continued evolution includes many new forms of the game and simulated golf is a part of it.” Based on the growing golf simulator industry trend, we continue to believe there is a strong demand for our new hardware and software products. Based on the growing industry golf simulator trend noted above, we continue to believe there is a strong demand for our new hardware and software products.

According to recently released data from The National Golf Foundation, 45 million Americans aged 6 and above played golf in 2023. This record-setting total includes 32.9 million people who played off-course golf, with 18.4 million of them who participated exclusively in off-course golf activities at places such as driving ranges, indoor golf simulators, or golf entertainment venues. Only 12.1 million played exclusively on-course, furthering the trend

Principal External Factors Affecting Our Operating Results

We believe that our performance and future success depend on many factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section entitled “Risk Factors”.

●

Market acceptance. The growth of our business depends on our ability to gain broader acceptance of our current products by continuing to make users aware of the significant benefits of our products to generate increased demand and frequency of use, and thus increase our sales. Our ability to grow our business will also depend on our ability to expand our customer base in existing or new target markets, including international markets. Although we have increased the number of users of TruGolf Nevada hardware and software product offerings and continue to grow our channels globally through established relationships and focused sales efforts, we cannot provide assurance that our efforts will continue to increase the use of our products.

●	Approval and timing of Business Combination. We must successfully obtain timely approvals (both regulatory as well as from stockholders of TruGolf Nevada and Deep Medicine) for the Business Combination currently being contemplated. For our sales to grow, particularly in 2023, we will also need to obtain such approvals and close the Business Combination on a timely basis in order to have cash on hand in order to execute our business model as presently underwritten.

●	Sales force size and effectiveness. The rate at which we grow our sales force and expansion channels and the speed at which newly hired salespeople and sales channels become effective can impact our revenue growth and our costs incurred in anticipation of such growth. We intend to continue to make significant investments in our sales and marketing organization and channels by increasing the number of sales representatives and expanding our international programs to help facilitate further adoption of our products as well as broaden awareness of our products to new customers. We are slowly expanding into EMEA through a quickly growing network of distributors that will each slowly develop their respective territories, sales from EMEA are still below 5% of total sales. We have also signed a Joint Venture agreement with a partner in China to manage all distribution needs across Asia. We are not required to invest in any of these markets, and as such take a lower margin on products sold there, therefore we expect slowly growing impacts on top line revenue from these globalization efforts.

●	Product and geographic mix; timing. Our financial results, including our gross margins, may fluctuate from period to period based on the timing of orders, fluctuations in foreign currency exchange rates and the number of available selling days in a particular period, which can be impacted by a number of factors, such as holidays or days of severe inclement weather in a particular geography, the mix of products sold and the geographic mix of where products are sold.

●	Material adverse COVID-19 and Supply Chain Disruptions: The impacts to our business from COVID-19 have long since ceased to be a concern. Initial supply chain disruptions around our sourcing of various products from high speed cameras to turf slowed down our ability to deliver our simulators, and travel restrictions and risks associated with our team installing these simulators had some impact in 2020 and 2021, however not a single issue with any of our vendors or installers, including 3^rd party installers has any current affect on our Operating Results. This includes chips and cameras used by automotive industry which have all been mitigated. These mitigation strategies created a reduction in speed to market of Apogee units, but this has been resolved and no further impact is anticipated from any of our suppliers, or their raw goods suppliers.

Principal Components of Revenues, Costs and Expenses

Revenues

Our revenues come from the sale of TruGolf Nevada software and hardware, which products are sold through a global network of authorized resellers, retail outlets and direct-to-consumer through a dedicated TruGolf Nevada sales team.

Cost of Revenues

Cost of revenues consists primarily of costs that are directly related to the delivery of our TruGolf Nevada hardware and software products, excluding depreciation but including direct material, labor, manufacturing overhead, reserves for estimated warranty costs and charges to write-down the inventory carrying value when it exceeds the estimated net realizable value.

Operating Expenses

Royalties

We have agreements with certain software golf hardware vendors who bundle our tracking and golf course software with their hardware. We pay them a royalty based on the number of units or subscriptions they sell. The royalty percentages typically range between 20% to 30%. The royalty agreements are for one year, with automatic renewal unless each party gives a thirty-day written notice of the intent to cancel the contract prior to the renewal date.

Salaries, Wages and Benefits

Salaries, wages and benefits are expenses earned by our employees in the executive, information technology, finance and accounting, human resources, administrative functions and outside contractors. Also included in salaries, wages and benefits are employer payroll taxes, health, dental and life insurance expenses.

Selling, General and Administrative

Sales and marketing expenses consist primarily of advertising, training events, brand building, product marketing activities and installation and shipping costs. We expect sales and marketing costs will continue to increase as we expand our international selling and marketing activities, hire additional personnel, and build brand awareness through advertising and training.

General and administrative expenses consist primarily of professional fees paid for legal, accounting, auditing, and consulting services, bad debt, licenses and association dues, facilities (including rent and utilities) bank and credit card processing fees and other expenses related to general and administrative activities.

We anticipate that our general and administrative expenses will continue to increase as we continue hiring to support our growth. We also anticipate that we will incur increased accounting, audit, legal, regulatory, compliance, and investor and public relations expenses associated with operating as a public registrant.

Other Expense

Interest Expense

Interest expense consists of interest expenses associated with issuing notes and balances outstanding under our debt obligations and the gross sales royalty payable, the amortization of debt issuance costs and original issue discounts associated with such borrowings.

Loss on Investment

During the year ended December 31, 2022, we wrote off our $100,000 equity investment in a small entity that was intended to help develop and sell our products.

Gain on Loan Extinguishment

In May 2020, we received a $735,000 loan under the Coronavirus Aid, Relief, and Economic Security Act Paycheck Protection Program. During the year ended December 31, 2021, the loan was forgiven.

Principal Cash Flows

We generate cash primarily from our operating activities and, historically, we have used cash flows from operating activities and available borrowings under certain notes payable as the primary sources of funds to purchase inventory and to fund working capital and capital expenditures, growth and expansion opportunities (see also “Liquidity and Capital Resources” below). The management of our working capital is closely tied to operating cash flows, as working capital can be impacted by, among other things, our accounts receivable activities, the level of inventories, which may increase or decrease in response to current and expected demand, and the size and timing of our trade accounts payable payment cycles.

Critical Accounting Estimates

We prepare our financial statements in accordance with accounting principles generally accepted in the United States of America. The application of many accounting principles requires us to make assumptions, estimates and/or judgments that affect the reported amounts of assets, liabilities, revenues and expenses in our financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable under the circumstances. These assumptions, estimates and/or judgments, however, are often subjective and they and our actual results may change based on changing circumstances or changes in our analyses. If actual amounts are ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts first become known. We believe the following critical accounting estimates could potentially produce materially different results if we were to change underlying assumptions, estimates and/or judgments. See also Note 2 - Summary of Significant Accounting Policies to our audited annual financial statements for a summary of our significant accounting policies.

Accounts Receivable, net

We manage credit risk associated with our accounts receivables at the customer level.

Our allowance is estimated using a loss rate model based on delinquency. The estimated loss rate is based on our historical experience with specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and our own judgment as to the likelihood of ultimate payment based upon available data. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts.

Inventory, net

Warrants

The fair value of the warrants is estimated on the date of issuance using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including the expected term of the warrants, expected stock price volatility, and expected dividends. The actual estimates used can be found in Note 12 - Convertible Notes Payable in the annual audited financial statements. These estimates involve inherent uncertainties and the application of management’s judgment. Expected volatilities used in the valuation model are based on the average volatility of the comparable companies publicly traded on recognized stock exchanges. The risk-free rate for the expected term of the option is based on the United States Treasury yield curve in effect at the time of grant.

Results of Operations

Comparisons of the Years ended December 31, 2023 and 2022

The following table sets forth certain condensed statement of operations data for the periods indicated in dollars. In addition, we note that the period-to-period may not be indicative of future performance.

	Year Ended December, 31						Variation
	2023			2022			$			%
Revenues, net	$	20,583,851		$	20,227,331		$	356,520			1.76	%
Cost of revenues		7,825,768			7,018,378			807,390			11.50	%
Gross profit		12,758,083			13,208,953			(450,870	)		(3.41	)%
Operating expenses		21,418,295			12,476,571			8,941,724			71.67	%
(Loss) income from operations		(8,660,212	)		732,382			(9,392,594	)		(1,282.47	)%
Net loss		(10,283,109	)		(956,841	)		(9,326,268	)		974.69	%
Net loss income per common share	$	(857.35	)	$	(84.62	)	$	(772.74	)		913.23	%

Revenues

Our revenues were $20,583,851 for the year ended December 31, 2023, compared to $20,227,331 for the year ended December 31, 2022, an increase of $356,520 or 1.76%. The increase in revenues was due primarily to a $600,953 increase related to ramping up the new Apogee launch monitor offset by a $244,433 decrease in software subscription and other sales.

Cost of Revenues

Cost of revenues for the year ended December 31, 2023, increased $807,390 or 11.50% to $7,825,768 from $7,018,378 for the year ended December 31, 2022. The increase was due primarily to a $882,060 increase in the cost of simulator parts and materials and a $116,772 increase in labor to manufacture our simulators. The cost of shipping our finished simulators increased $168,423 due to price increases from our national shipping companies UPS, FedEx and Seko. These increased costs in 2023 were offset by an approximate $353,310 decrease in inventory write downs and adjustments compared to the prior year. Materials and components to manufacture our simulators primarily include fabricated steel, cut cloth, turf, computers, cameras and other high-end electronics which are subject to inflationary pricing pressures. We are continuously working with our suppliers for volume pricing discounts and extended contract terms.

Operating Expenses

Our operating expenses were $21,418,295 for the year ended December 31, 2023, compared to $12,476,571 for the year ended December 31, 2022, an increase of $8,941,724 or 71.67%. The increase for the year ended December 31, 2023, compared to December 31, 2022, was due primarily to:

	i.	An increase of $158,677 in royalties expenses was due to the addition of new distributors and increases in the royalty percentages for certain resellers.

	ii.	A $2,708,096 increase in salaries, wages and benefits expenses. The year over year increase is a result of:

	1.	The Board of Directors authorizing and granting the issuance 252 shares of common stock to two executives in October 2023. The Chief Growth Officer and the Chief Customer Experience Officer each received 126 common shares. The Company recorded stock compensation expense (noncash) of $1,379,196 (estimated fair value of the stock) at the time of grant and issuance.

	2.	The Company hiring and paying more for contract and in-house developers to work on the new APEX 6 connect software. Beginning in 2022 and continuing into 2023, we undertook the project of developing new software on a new software platform in order to surpass what was available in the market and offered by competitors. The software offers better graphics, stroke analysis, more courses to play and a competitive driving range competition. The new software was demonstrated at the PGA National Convention in January 2024. Additionally, with the release of the Apogee launch monitor, we hired additional quality assurance and customer support personnel along with increases in employee benefit costs.

		For the year ended December 2023, contract developer labor was $1,029,412 compared to $896,534 for the year ended December 2022, a $132,878 increase. Salaries, wages and benefits for in-house employees for the year ended December 2023, was $7,272,305 compared to $6,076,283 for the year ended December 2022, a $1,196,022 increase. In October 2023, we had a reduction in force with anticipated annual savings of approximately $350,000 to $400,000.

iii.

A $6,074,951 increase in selling, general and administrative expenses. The year over year increase is a result of:

	1.	In April 2022, we secured the services of two consultants (also the Note Holders as described in Note 12 – Convertible Notes Payable in our annual audited financial statements) to assist with services including assisting the Company’s and its counsel in an initial public offering preparation and listing to NASDAQ or other national exchange, assist the Company and its counsel in preparing a code of conduct and employment agreements, franchise development, and valuation increase through growth among other services.

		Once services are performed, the first consultant will be provided a 3% stock grant; while the second consultant will be provided up to 7% of stock based on performance deliverables including: 1.75% on consummation of an initial bridge loan agreement, 1.75% on engaging an investment banker, 1.75% upon filing an S-1 including financial statements and footnotes, and 1.75% upon the closing of an initial public offering. The second consultant will be provided warrants at a 20% discount to the then current price per share, for up to 2% for achieving a $250 million valuation and 3% more for a $500 million valuation, as well as another 2% for opening the first franchise location, and 3% more once 100 franchise locations have been sold.

		In March 2023, the Board of Directors granting and authorizing the issuance 821 shares of common stock two consultants (and holders of the convertible notes described in Note 12 – Convertible Noted Payable in our annual audited financial statements) for consulting service performed. The Company recorded consulting fee expense (noncash) of $4,493,333 (estimated fair value of the stock) at the time of grant and issuance.

	2.	Sales and marketing expense increased $852,486 for the year ended December 31, 2023 compared to the year ended December 31, 2022, due to a $504,202 increase in business development expenses such as hiring a professional public relations firm or outside marketing consultants. Third party simulator installer expense increased $383,722 as we shifted from in-house installers to third party installers, which we believe will reduce our installation costs and improve the quality of the installations over time.

	3.	All other selling, general and administrative expenses (such as facilities professional fees, warehouse, travel, office supplies etc.) increased $729,132 for the year ended December 31, 2023 compared to the year ended December 31, 2022 due primarily to a $681,479 increase in bad debt expense as a result our regular review, in line with our policy, to estimate the loss rate based on our historical experience with specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and our own judgment.

Interest Income

Our interest income was $108,011 for the year ended December 31, 2023. There was no interest income for the year ended December 31, 2022. The interest income is from the short-term investments with Morgan Stanley.

Interest Expense

Our interest expense was $1,730,908 for the year ended December 31, 2023, compared to $1,589,223 for the year ended December 31, 2022, an increase of $141,685 or 8.92%. The increase for the year ended December 31, 2023, compared to December 31, 2022 is a net result of a $71,075 increase in interest for the Ethos management loan (a new loan), a $105,937 increase in interest for the margin line of credit account (a new loan), a $83,873 increase in the gross sales royalty perpetual debt, a $556,317 increase in the interest on the dividend notes payable less a $637,889 decrease in the interest expense for the warrants’ excess fair value over the pro-rata allocation of loan proceeds and in interest expenses based on an estimated 70% discounted conversion price to fair value of the common stock (all expensed in 2022 in connection with the issuance of the convertible notes. (See Note 12 – Convertible Notes Payable in the annual audited financial statements).

Liquidity and Capital Resources

We primarily obtain cash to fund our operations through the reinvestment of free cash flows generated from our business operations, issuance of common stock to private friend and family investors, issuance of term loans, issuance of notes payable and convertible debt instruments, and royalty structures.

As of December 31, 2023, we had $5,397,564 in cash, cash equivalents and restricted cash and current working capital of $1,988,267 compared to $9,656,266 in cash and cash equivalents and current working capital of $6,278,408 as of December 31, 2022.

In December 2023, we entered into a $2,000,000 variable rate line of credit with JP Morgan Chase Bank, N.A. The purpose of the new line of credit was to consolidate the balances outstanding on both the JP Morgan Chase Bank note payable and the previous line of credit, which had matured. The new line of credit matures on December 31, 2024. The line of credit has an annual interest rate computed at the Adjusted SOFR (Secured Overnight Financing Rate) Rate and at a rate of 3.00% above the SOFR Rate. The Adjusted SOFR rate means the sum of the Applicable margin (3.50% per annum) plus the SOFR rate applicable to the interest period plus the Unsecured to Secured Rate Adjustment. The line of credit is secured by a pledge of $2,100,000 in the Company’s deposit accounts (restricted cash) at JP Morgan Chase. As of December 31, 2023 the balance outstanding on the line of credit was $802,738 and there was approximately $1,197,262 in available borrowings. As of December 31, 2022, the balance outstanding on the earlier line of credit was $545,625.

Cash Flow from Operating Activities

For the year ended December 31, 2023, the net cash used in our operating activities was $6,133,221. Our reported net loss when adjusted for non-cash income and expense items, such as depreciation and amortization expenses for property and equipment, right-of-use asset, and original issue discount and fair value of warrants in excess of fair value of debt and loss on equity investment, provided negative cash flows of $3,181,611. These cash flows from operating activities were positively impacted primarily by a $20,236 increase in inventory and other current assets, a $596,434 increase in accounts payable, a $615,582 increase in accrue interest payable and a $374,819 increase in accrued and other liabilities. Partially offsetting these positive cash flows were $1,335,714 increase in accounts receivable, a $114,385 increase in prepaid expenses, a $1,905,983 increase in other assets, a $1,008,296 decrease in customer deposits and a $269,848 decrease in lease liability.

The increase in accounts receivable is due primarily the timing of and collection related to the black Friday and Christmas holiday sales. The increase in accounts payable is due to the timing of processing and making supplier payments. Prepaid expenses increase due primarily to a $100,000 payment to a supplier for cameras to arrive in the first quarter of 2024. Other assets increased due to the $1,875,000 deposit paid for the Ethos Management Inc loan. Accrued interest payable increased due primarily to the accrual of the Ethos Management Loan interest (which is payment is deferred to 2025) and the interest on the dividend notes payable which is payable in 2025. Customer deposits represent a 50% deposit collected from customers prior to manufacturing their simulator. The deposit is applied to the customer’s final invoice. In addition, accrued and other liabilities increased primarily due to higher accrued payroll, benefits and credit card balances. Lease liability decreased due to the lease payments made.

Cash Flows from Investing Activities

For the year ended December 31, 2023, the cash used in our investing activities was $2,620,558. We spent $127,413 for the purchase of computers, desk, etc. for new employees and $2,493,145 to purchase marketable investment securities.

Cash Flows from Financing Activities

For the year ended December 31, 2023, the cash provided by our financing activities was $4,495,077. During the year ended December 31, 2023, we borrowed $1,980,937 on our Morgan Stanely margin line of credit account. We drew $2,499,999 (or the first three of ten available tranches) on the Ethos Management Inc loan. Principal and interest payments are deferred until April 2027. We also borrowed an additional $185,500 on the convertible notes and $50,000 on the McKettrick note payable netted against the $37,000 in repayments on the Carver loan. The proceeds from the Ethos Management loan and convertible note borrowings were used to support our ongoing operations. One shareholder returned $40,150 in overpaid past dividends.

The Company has incurred net losses and negative operating cash flows for the year ended December 31, 2023. As the Company continues to incur losses, successful transition to profitability is dependent on achieving a level of revenues adequate to support the Company’s cost structure. Unless and until this occurs, the Company may need to raise capital or issue debt to support ongoing operations.

Under the rules of ASC Subtopic 205-40 “Presentation of Financial Statements-Going Concern” (“ASC 205-40”), the Company is required to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that these financial statements are issued or available to be issued. This evaluation takes into account the Company’s current available cash and projected cash needs over the one-year evaluation period but may not consider things beyond its control.

In 2022 and prior years, the Company has reported operating income and positive operating cash flows. However, for 2023, the Company has experienced operating losses due primarily to expensing (1) consulting fees and issuing common stock associated with the services provided by third-party consultants related to the propose DMAC business combination (See Note 20 – Subsequent Events), (2) expensing employee stock compensation and issuing commons stock for services performed as well as relied on the capital raised from related parties and institutional financing to continue ongoing operations. We may or may not be able to raise additional capital or obtain additional institutional financing due to future economic conditions. In particular, the lending criteria are currently tightening in the United States. These factors, when considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date these financial statements are issued. In response to these conditions, the Company’s management has prepared the following financing plan, which we believe mitigates the going concern uncertainty:

We project that we will be able to meet our debt service and other cash obligations for at least the next 12 months. Our significant projected cash commitments relate primarily to debt service and operating expenses. We anticipate the cash required to service our debt to be between $1,100,000 to $3,000,000. The $3,000,000 assumes (1) the convertible notes are retired by cash payment rather than conversion into our stock at maturity and (2) the note payable – ARJ Trust (See Note 10 – Related Party Notes Payable) are retired at maturity. These notes are controlled by the Company’s Chief Executive Officer and have historically been extended (13 times) in one-year increments. The Morgan Stanley margin line of credit account is 100 percent secured with the short-term investments held in the brokerage account. The Morgan Stanley margin line of credit account would be retired through liquidation of the investments. At December 31, 2023, the Company had an additional $341,544 in availability on the Morgan Stanely margin line of credit account. The Morgan Stanly was paid off in March 2023 through liquidation of the short-term investments.

Our significant projected cash requirements related primarily to operating expenses for the next 12 months include $7,000,000 to $8,000,000 for employees’ salaries, wages and benefits, $950,000 to $1,200,000 for installation and customers service, and $1,000,000 to $1,200,000 for development of software and hardware. For the year ending December 31, 2023, we spent an average of five percent of total sales on our marketing and business development efforts. For the next twelve months (through December 2024), we anticipate spending six to eight percent of total projected sales, or $1,850,000 to $2,500,000 on marketing and business development. Due to the timing of our sales and cash receipts, we project to generate sufficient recurring cash flow to cover our selling, general and administrative expenses each period. No assurances can be given that the results anticipated by our projections will occur. With respect to long-term liquidity requirements, approximately $12,400,000 of our debt contractually matures in years 2025 to 2033.

Management believes the plan outlined above provides an opportunity for the Company to continue as a going concern.

Business Updates

Franchise Agreement

New Software Release

On March 28, 2024, we released our new software and features designed for the TruGolf E6 Apex Software. We demonstrated the new software and features at the PGA National Convention in January 2024 and received very positive feedback. We believe that this new software and features will substantially improve the user experience and functionality of the software suite, making a best-in-class offering that much better.

mlSpatial Definitive Agreement

Material Cash Requirements for Known Contractual and Other Obligations

We have entered into operating leases for our corporate headquarters and a warehouse in Centerville, Utah. The leases have varying terms expiring between 2023 and 2025. In June 2023, we entered into a new sixty-month, triple net lease for additional warehouse space in North Salt Lake, Utah. The lease payments range between $10,457 and $11,770. See Note 18 - Commitments and Contingencies, to our audited financial statements for additional details related to our operating leases.

We enter into agreements in the normal course of business with various vendors, which are generally cancellable upon notice. Payments due upon cancellation consist only of payments for services provided or expenses incurred, including non-cancellable obligations of service providers, up to the date of cancellation.

Recent Accounting Pronouncements

Management has evaluated all recent accounting pronouncements issued by the Financial Accounting Standards Board and determined that none of the pronouncements will have a material impact on our financial statements. We will continue to monitor the issuance of any new accounting pronouncements and assess their potential impact on the financial statements in future periods.

Emerging Growth Company

We are an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that (i) we are no longer an emerging growth company or (ii) we affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.

Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

We had cash, cash equivalents and restricted cash totaling $5,397,564 as of December 31,2023. Cash equivalents were invested primarily in low interest checking or savings accounts. Our investment policy is focused on the preservation of capital and supporting our liquidity needs. Under our investment policy, we will only invest in highly rated securities, issued by the U.S. government or liquid money market funds. We do not invest in financial instruments for trading or speculative purposes, nor do we use leveraged financial instruments. We may utilize external investment managers who adhere to the guidelines of our investment policy. A hypothetical 10% change in interest rates would not have a material impact on the value of our cash, cash equivalents and restricted cash, net loss or cash flows.

We do not have significant exposure to interest rate risk as only our lines of credit are variable rate. As of December 31, 2023, the variable rate lines of credit had a balance outstanding of $2,783,675 compared to the total fixed rate debt outstanding of $10,605,692. Thus, management believes a hypothetical 10% change in interest rates would not have a material impact on annualized interest expenses.

We maintain our cash in bank deposit accounts which, at times, may exceed any applicable Federal Deposit Insurance Corporation (“FDIC”) insurance limits. As of December 31, 2023, the amount in excess of federally insured limits was $4,251,124.

Cybersecurity Risk

We have completed an assessment of our a suite of controls including technology hardware and software solutions, regular testing of the resiliency of our systems including penetration and disaster recovery testing as well as regular training sessions on cybersecurity risks and mitigation strategies, and have engaged a 3^rd party to bring us up to industry best practices. We have established an incident response plan and team to take steps it determines are appropriate to contain, mitigate and remediate a cybersecurity incident and to respond to the associated business, legal and reputational risks. There is no assurance that these efforts will fully mitigate cybersecurity risk and mitigation efforts are not an assurance that no cybersecurity incidents will occur, and have had no such breaches of security.

Internal Control Over Financial Reporting

TruGolf had been a private company with limited accounting personnel to adequately execute its accounting processes and limited supervisory resources with which to address its internal control over financial reporting. In connection with the audits of our financial statements as of and for the years ended December 31, 2023 and 2022, we identified material weaknesses (defined as a deficiency or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of TruGolf’s annual or interim financial statements will not be prevented or detected on a timely basis) in our internal control over financial reporting that we are currently working to remediate, which relate to: (a) insufficient segregation of duties in the financial statement close process; (b) a lack of sufficient levels of staff with public company and technical accounting experience to maintain proper control activities and perform risk assessment and monitoring activities; and (c) insufficient information systems controls, including access and change management controls. We have concluded that these material weaknesses in our internal control over financial reporting occurred because we did not have the necessary business processes, personnel and related internal controls to operate in a manner to satisfy the accounting and financial reporting timeline requirements of a public company.

We are focused on designing and implementing effective internal control measures to improve our evaluation of disclosure controls and procedures, including internal control over financial reporting, and remediating the material weaknesses. In order to remediate these material weaknesses, we have taken and plan to take the following actions:

●

The hiring and planned continued hiring of additional accounting staff with public company experience;

●

Implementation of new enterprise resource planning system to replace the prior enterprise resource planning system;

●

Implementation of additional review controls and processes requiring timely account reconciliation and analyses of certain transactions and accounts, and

●

The planned hiring of a national accounting firm to assist in the design and implementation of controls and remediation of control gaps.

TruGolf did not design and has not maintained an effective control environment as required under the rules and regulations of the SEC. Specifically, (i) management does not have appropriate IT general control in place over change management, user access, cybersecurity, and reviews of service organizations, (ii) management does not have suitable COSO entity level controls in place, including reviews of the financial statements, and certain entity level controls were not performed by management, and (iii) pervasive transactional and account level reconciliations and analyses are not performed, or not performed with sufficient detail to prevent or detect a material weakness. These issues related to managements controls over the review of complex significant transactions, complex debt and equity issuance transactions, income and sales taxes, & revenue recognition.

TruGolf has taken certain steps, such as recruiting additional personnel, implementing a new enterprise resource planning system, in addition to utilizing third-party consultants and specialists, to supplement its internal resources, to enhance its internal control environment and plans to take additional steps to remediate the material weaknesses. Although TruGolf plans to complete this remediation process as quickly as possible, it cannot at this time estimate how long it will take. TruGolf cannot assure you that the measures it has taken to date and may take in the future, will be sufficient to remediate the control deficiencies that led to its material weaknesses in internal control over financial reporting or that it will prevent or avoid potential future material weaknesses.

●

The hiring and planned continued hiring of additional accounting staff with public company experience;

●

Implementation of new enterprise resource planning system to replace the prior enterprise resource planning system;

●

Implementation of additional review controls and processes requiring timely account reconciliation and analyses of certain transactions and accounts, and

●

The planned hiring of a national accounting firm to assist in the design and implementation of controls and remediation of control gaps.

In accordance with the provisions of the JOBS Act and the Sarbanes-Oxley Act, we and our independent registered public accounting firm were not required to, and did not, perform an evaluation of our internal control over financial reporting as of December 31, 2022, and 2021 nor any subsequent period. Material weaknesses may still exist when we report on the effectiveness of our internal control over financial reporting as required under Section 404(a) of the Sarbanes-Oxley Act after the completion of the Business Combination.

Exhibit 99.3

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Defined terms included below have the same meaning as terms defined and included elsewhere herein. All dollar amounts are expressed in thousands of United States dollars (“$”), unless otherwise indicated.

Introduction

The following unaudited pro forma condensed combined financial statements and accompanying notes are provided to aid you in your analysis of the financial aspects of the Transactions and adjustments for other material events. These other material events are referred to herein as “Material Events” and the pro forma adjustments for the Material Events are referred to herein as “Adjustments for Material Events.”

The unaudited pro forma condensed combined financial statements give effect to the Merger and other events contemplated by the Merger Agreement as described in this proxy statement/prospectus. The unaudited pro forma condensed combined balance sheet as of December 31, 2023 combines the unaudited consolidated balance sheet of DMA as of December 31, 2023 with the audited balance sheet of TruGolf Nevada as of December 31, 2023, giving effect to the transactions as if they occurred on December 31, 2023. The unaudited pro forma condensed combined statement of operations for the twelve months ended December 31, 2023 combines the unaudited consolidated statement of operations of DMA for the twelve months ended December 31, 2023 and the audited statement of operations of TruGolf Nevada for the year ended December 31, 2023, giving effect to the transactions and other events contemplated by the Merger Agreement as if they have been consummated on January 1, 2023 (the beginning of the earliest period presented).

The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and do not necessarily reflect what New TruGolf’s financial condition or results of operations would have been had the Transactions and Material Events occurred on the dates indicated. Further, the pro forma condensed combined financial information may not be useful in predicting the future financial condition and results of operations of New TruGolf. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors.

The unaudited pro forma condensed combined financial statements have been derived from and should be read in conjunction with:

the accompanying notes to the unaudited pro forma condensed combined financial statements;

● the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and other financial information relating to each of TruGolf Nevada and DMA included herein.

The unaudited pro forma condensed combined statement of operations for the twelve months ended December 31, 2023 has been prepared using the following:

● unaudited consolidated statement of operations of DMA for the twelve months ended December 31, 2023 (not included elsewhere in this proxy statement/prospectus);

● audited statement of operations of TruGolf Nevada for the year ended December 31, 2023.

Description of the Business Combination

On January 31, 2024, we completed the business combination and transactions contemplated thereby (the “Business Combination”) as set forth in that certain Amended and Restated Agreement and Plan of Merger (as amended), dated July 21, 2023, as amended, including by the First Amendment to the Amended and Restated Agreement and Plan of Merger, dated December 7, 2023, and as it may be further amended and/or restated from time to time (the “Merger Agreement”). On the Closing Date, (i) the total number of DMA Class A Shares issued as Merger Consideration in connection with the Business Combination was 5,750,274, and these DMA Class A Shares represent approximately 44.0%, of the issued and outstanding DMA Common Stock immediately following the closing of the Business Combination, (ii) the total number of DMA Class B Shares issued in connection with the Business Combination was 1,716,860 DMA Class B Shares, and these DMA Class B Shares represent approximately 13.1%, of the issued and outstanding DMA Common Stock immediately following the closing of the Business Combination. As a result of the Merger, TruGolf Nevada became a wholly-owned subsidiary of DMA, with the shareholders of TruGolf Nevada becoming stockholders of DMA.

As contemplated by the Merger Agreement, DMA changed its name to TruGolf Holdings, Inc. Prior to and in connection with the approval of the Business Combination, holders of 378,744 DMA Class A Shares properly exercised their right to have such shares redeemed for a full pro rata portion of the trust account holding the proceeds from the IPO, calculated as of two business days prior to the completion of the Business Combination, which was approximately $11.50 per share resulting in the removal of $4,355,556 from the trust account. In addition, in connection with the January 26, 2024 meeting to amend certain provisions of DMA’s corporate documents allowing DMA to extend its existence, an additional 943 shares were redeemed resulting in the removal of an additional $10,845 from the trust account. As a result, existing DMA stockholders elected to redeem approximately 379,687, or approximately 8.7% of the then-outstanding shares of 4,357,964.

Basis of Pro Forma Presentation

The unaudited pro forma condensed combined financial statements were prepared in accordance with Article 11 of SEC Regulation S-X, as amended by the final rule, Release No. 33-10786, Amendments to Financial Disclosures about Acquired and Disposed Businesses. Release No. 33-10786 replaces the historical pro forma adjustments criteria with simplified requirements to depict the accounting for the transaction (“Transaction Accounting Adjustments”) and present the reasonably estimable synergies and other transaction effects that have occurred or are reasonably expected to occur (“Management’s Adjustments”). DMA has elected not to present Management’s Adjustments and will only be presenting Transaction Accounting Adjustments in the unaudited pro forma condensed combined financial information. The adjustments presented in the unaudited pro forma condensed combined financial statements have been identified and presented to provide relevant information necessary for an understanding of the combined company upon consummation of the Transactions.

Management has made significant estimates and assumptions in its determination of the pro forma adjustments. As the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final amounts recorded may differ materially from the information presented.

The pro forma adjustments reflecting the consummation of the Transactions and Material Events are based on certain currently available information and certain assumptions and methodologies that each of TruGolf Nevada and DMA believes are reasonable under the circumstances. The pro forma adjustments, which are described in the accompanying notes, may be revised as additional information becomes available and is evaluated. Therefore, it is likely that the actual adjustments will differ from the pro forma adjustments, and it is possible the differences may be material. Each of TruGolf Nevada and DMA believes that its assumptions and methodologies provide a reasonable basis for presenting all the significant effects of the Transactions and Material Events based on information available to management at this time and that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial information.

In addition to the Merger Consideration set forth above, the TruGolf Nevada Stockholders will also have a contingent right to receive up to an aggregate of an additional 4.5 million DMA Class A Shares (the “Earnout Shares”), as additional consideration, with each share valued at $10 per share (the “Purchaser Share Price”) during the three (3) year period following the Closing (the “Earnout Period”). The Earnout Shares shall be earned, based on the combined company meeting criteria relating to (i) consolidated gross revenue, (ii) VWAP (as defined below) of DMA Class A Shares, or (iii) number of qualified franchise locations opened. The Earnout Shares shall be allocated into three tranches consisting of a first tranche of 1,000,000 Earnout Shares (the “First Tranche”), a second tranche of 1,500,000 Earnout Shares (the “Second Tranche”), and third tranche of 2,000,000 Earnout Shares (the “Third Tranche”). The Earnout Shares will be earned as set forth below:

a) The First Tranche of a maximum of 1,000,000 Earnout Shares will be earned as follows (i) in the event that the gross consolidated gross revenue of New TruGolf and its subsidiaries (the “ Gross Revenues”) for 2024 equals or exceeds Thirty Million Dollars ($30,000,000) but is less than Forty Two Million Dollars ($42,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the First Tranche or in the event that the Gross Revenues for 2024 equals or exceeds Forty Two Million Dollars ($42,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the First Tranche; or (ii) in the event that the dollar volume-weighted average price(“VWAP”) of the DMA Class A Shares is at least $13.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to received100% of the First Tranche or, in the event that ten (10) or more Qualified Franchise Locations (as defined in the Merger Agreement) are opened prior to the end of the calendar year 2024, then the TruGolf Nevada Stockholders shall be entitled to received100% of the First Tranche.

b) The Second Tranche of a maximum of 1,500,000 Earnout Shares will be earned as follows (i) in the event that the Gross Revenues for 2025 equals or exceeds Fifty Million Dollars ($50,000,000) but is less than Sixty Five Million Dollars ($65,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the Second Tranche or in the event that the Gross Revenues for 2025 equals or exceeds Sixty Five Million Dollars ($65,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche; or (ii) in the event that the VWAP of DMA Class A Shares is at least $15.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche or, in the event that thirty (30) or more Qualified Franchise Locations are opened prior to the end of the calendar year 2025, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche.

c) The Third Tranche of a maximum of 2,000,000 Earnout Shares will be earned as follows (i) in the event that the Gross Revenues for 2026 equals or exceeds Eighty Million Dollars ($80,000,000) but is less than One Hundred Million Dollars ($100,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the Third Tranche or in the event that the Gross Revenues for 2026 equals or exceeds One Hundred Million Dollars ($100,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche; or (ii) in the event that the VWAP of DMA Class A Shares is at least $17.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche or, in the event that fifty (50) or more Qualified Franchise Locations are opened prior to the end of the calendar year 2026, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche.

If at the end of a Price Measurement Period, a Revenue Milestone or a Price Milestone or a Franchise Milestone is not met, TruGolf Nevada Stockholder shall not be entitled to receive the applicable portion of the Earnout Shares.

The accounting for the Earnout Shares was first evaluated under ASC 718 to determine if the arrangement represents a share-based payment arrangement. Considering that the Earnout Shares are part of the Merger Consideration and there are no service conditions nor any requirement of TruGolf Nevada Stockholders to provide goods or services, we determined that the Earnout Shares are not within the scope of ASC 718. In reaching this conclusion, we focused on the fact that the Earnout Shares are not provided to any holder of options or unvested stock but rather the arrangement is provided only to vested equity holders.

Next, we determined that the Earnout Shares represent a freestanding equity-linked financial instrument to be evaluated under ASC 480. Based upon the analysis, we concluded that the Earnout Shares should not be classified as a liability under ASC 480.

We next considered the conditions in ASC 815-10-15-74 and ASC 815-40 and concluded that the Earnout Shares are not within the scope of ASC 815. Therefore, the Earnout Share arrangement is appropriately classified in equity.

The unaudited pro forma condensed combined financial information does not give effect to any anticipated synergies, operating efficiencies, tax savings, or cost savings that may be associated with the Transactions. TruGolf Nevada and DMA have not had any historical relationship prior to the Transactions. Accordingly, no pro forma adjustments were required to eliminate activities between the companies.

The unaudited pro forma condensed combined financial information has been prepared based on actual redemptions of 379,687 out of the total 574,764 shares of DMA common stock subject to redemption, for an aggregate redemption price of $4.37 million out the Trust Account. No other shares of DMA common stock were subject to redemption, plus a convertible debt financing of $15,500,000 with 10% Original Issuance Discount (“OID”) were available to fund expenses in connection with the Merger and to fund future cash needs of New TruGolf.

Included in the shares outstanding and weighted-average shares outstanding as presented in the unaudited pro forma condensed combined financial statements are the shares of New TruGolf common stock issued to legacy TruGolf Nevada shareholders on the closing date of the Business Combination, the shares of New TruGolf common stock that were held by existing DMA investors, the shares of New TruGolf common stock issued to I-Bankers as marketing fees in relation to the Business Combination, and the shares of New TruGolf common stock issued to Ellenoff Grossman & Schole LLP as fees for their services.

Upon closing of the Business Combination, shares of TruGolf Nevada common stock outstanding as presented in the unaudited pro forma condensed combined financial statements include the following:

	Accrual Redemptions
	Number of Shares Owned		% Ownership

TruGolf Nevada shareholders (1)		7,467,134		56.2	%
Private Placement Investors (2)		571,450		4.3	%
DMA Public stockholders (3)		1,460,077		11.0	%
DMA Directors and officers		280,000		2.1	%
DMA Sponsor (4)		3,162,500		23.8	%
I-Bankers (5)		313,952		2.4	%
Ellenoff Grossman & Schole LLP (6)		20,000		0.2	%
Total		13,275,113		100	%

(1) In connection with the Business Combination, 13,098 TruGolf Nevada ordinary shares were exchanged for 7,467,134 shares of New TruGolf common stock, consisting of 5,750,274 shares of Class A common stock and 1,716,860 shares of Class B common stock.

(2) DMA’s Insiders had an aggregate of 406,500 units, which contain 406,500 Private Placement Shares and 406,500 Private Rights. I-Bankers had an aggregate of 113,000 units, which contain 113,000 Private Placement Shares and 113,000 Private Rights. Each holder of a private right received one-tenth (1/10) of one share of DMA Class A common stock upon consummation of initial business combination. Private placement shares were the shares of DMA Class A common stock. The 519,500 shares of DMA Class A common stock and 519,500 Private Right were exchanged for a total of 571,450 shares of New TruGolf common stock upon the closing of the Business Combination.

(3) Prior to and in connection with the approval of the Business Combination, holders of 378,744 DMA Class A Shares properly exercised their right to have such shares redeemed for a full pro rata portion of the trust account holding the proceeds from the IPO. In addition, in connection with the January 26, 2024 meeting to amend certain provisions of DMA’s corporate documents allowing DMA to extend its existence, an additional 943 shares were redeemed, resulting in actual redemptions of 379,687 shares out of the total 574,764 shares of DMA common stock subject to redemption. Upon the closing of the Business Combination, 1,265,000 shares of New TruGolf Class A common stock were issued upon the conversion of 12,650,000 public rights.

(4) In connection with the Business Combination, 3,162,500 shares of DMA Class A common stock held by the Sponsor and its affiliates were converted into 3,162,500 shares of New TruGolf Class A common stock.

(5) Reflects the payment of transaction fee pursuant to the BCMA Amendment due at Closing, which was paid to I-Bankers a transaction fee equal to (i) $2,000,000 in cash and (ii) 212,752 New TruGolf Class A Common Shares, and an aggregate of 101,200 Representative Shares issued in connection with the IPO were exchanged to New TruGolf common stock upon the closing of the Business Combination.

(6) Up to 20,000 shares of Class A Common Stock issued to Ellenoff Grossman & Schole LLP as fees for their services.

Material Events and Background Relevant to Material Events

On November 2, 2023 and December 7, 2023, DMA executed loan agreements with certain accredited investors (together, the “Prior Loan Agreements”) pursuant to which such investors agreed to loan DMA up to an aggregate $11,000,000 in exchange for the issuance of convertible notes and warrants. On February 2, 2024, TruGolf Holdings, Inc. (f/k/a Deep Medicine Acquisition Corp.) (the “Company”) executed a securities purchase agreement (the “Purchase Agreement”) with each of the investors that executed the Prior Loan Agreements, which replaced, in their entirety, the Prior Loan Agreements, and with additional investors (together, the “PIPE Investors”). Pursuant to the terms and conditions of the Purchase Agreement, the PIPE Investors agreed to purchase from the Company (i) senior convertible notes in the aggregate principal amount of up to $15,500,000 (the “PIPE Convertible Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class A common stock (the “Series A Warrants”); and (iii) Series B warrants to initially purchase 1,550,000 shares of the Company’s Class A common stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”) (the “PIPE Financing”).

The Purchase Agreement contemplates funding of the investment (the “Investment”) across multiple tranches. At the first closing (the “Initial Closing”) an aggregate principal amount of $4,650,000 of PIPE Convertible Notes will be issued upon the satisfaction of certain customary closing conditions in exchange for aggregate gross proceeds of $4,185,000, representing an original issue discount of 10%. On such date (the “Initial Closing Date”), the Company will also issue the PIPE Investors the Series A Warrants and the Series B Warrants.

Subject to satisfying the conditions discussed below, the Company has the right under the Purchase Agreement, but not the obligation, to require that the PIPE Investors purchase additional Notes at up to two additional closings. Upon notice at any time after the 2nd trading day following the Initial Closing Date, the Company may require that the PIPE Investors purchase an additional aggregate principal amount of $4,650,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $4,185,000, if (i) the Registration Statement (as described below) has been filed; and (ii) certain customary closing conditions are satisfied (the “First Mandatory Additional Closing”). Upon notice at any time after the 2nd trading day following the date that the First Mandatory Additional Closing is consummated, the Company may require that the PIPE Investors purchase an additional aggregate principal amount of $6,200,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $5,580,000, if (i) the shareholder approval is obtained (as described below); (ii) the Registration Statement has been declared effective by the SEC; and (iii) certain customary closing conditions are satisfied (the “Second Mandatory Additional Closing”).

In addition, pursuant to the Purchase Agreement, each PIPE Investor has the right, but not the obligation, to require that, upon notice, the Company sell to such PIPE Investor at one or more additional closings such PIPE Investor’s pro rata share of up to a maximum aggregate principal amount of $10,850,000 in additional PIPE Convertible Notes (each such additional closing, an “Additional Optional Closing”); provided that, the principal amount of the additional PIPE Convertible Notes issued at each Additional Optional Closing must equal at least $250,000. If a PIPE Investor has not elected to effect an Additional Optional Closing on or prior to August 2, 2024, such PIPE Investor shall have no further right to effect an Additional Optional Closing under the Purchase Agreement.

Exchange of TruGolf Nevada Shares for Shares of New TruGolf

Based on 13,098 TruGolf Nevada ordinary shares outstanding immediately prior to the closing of the Business Combination, the Exchange Ratio determined in accordance with the terms of the Merger Agreement is approximately 570.10. New TruGolf issued 7,467,134 shares of New TruGolf common stock to legacy TruGolf Nevada shareholders in the Business Combination, determined as follows:

	TruGolf Nevada shares outstanding as of immediately prior to the Closing
Ordinary shares, par value $0.01 per share		13,098
Exchange Ratio		570.10
Estimated shares of New TruGolf common stock issued to TruGolf Nevada shareholders upon Closing		7,467,134

(1) The shares issued to legacy TruGolf Nevada shareholders consists of 5,750,274 shares of New TruGolf Class A common stock and 1,716,860 shares of New TruGolf Class B common stock.

Accounting for the Business Combination

The Merger will be accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, DMA will be treated as the acquired company for accounting purposes, whereas TruGolf Nevada will be treated as the accounting acquirer. In accordance with this method of accounting, the Business Combination will be treated as the equivalent of TruGolf Nevada issuing shares for the net assets of DMA, accompanied by a recapitalization. The net assets of TruGolf Nevada will be stated at historical cost, with no goodwill or other intangible assets recorded, and operations prior to the Business Combination will be those of TruGolf Nevada. TruGolf Nevada has been determined to be the accounting acquirer for purposes of the Business Combination based on an evaluation of the following facts and circumstances:

	●	Legacy TruGolf Nevada stockholders expecting to have a majority of the voting power of New TruGolf,
	●	TruGolf Nevada comprising the ongoing operations of New TruGolf,
	●	TruGolf Nevada contributing a majority of the governing body members of New TruGolf, and
	●	TruGolf Nevada’s senior management comprising the senior management of New TruGolf.

Accordingly, for accounting purposes, the Merger will be treated as the equivalent of TruGolf Nevada issuing stock for the net assets of DMA, accompanied by a recapitalization. The net assets of DMA will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Merger will be those of TruGolf Nevada.

Pro Forma Condensed Combined Balance Sheet

As of December 31, 2023

Unaudited

(Amounts in thousands of US$, except for per share data)

	DMA			TruGolf Nevada			Transaction Accounting adjustment				Pro Forma Balance Sheet

ASSETS

Current assets:
Cash and cash equivalents	$	178		$	3,298			10,438		A	$	13,914
Restricted cash		-			2,100			-				2,100
Accounts receivable, net		-			2,399			-				2,399
Inventory, net		-			2,119			-				2,119
Prepaid expenses		-			262			-				262
Marketable investment securities		-			2,479			-				2,479
Other current assets		-			-			-				-
Cash and marketable securities held in Trust Account		6,703			-			(6,703	)	B		-

Total current assets		6,881			12,657			3,735				23,273

Property, plant and equipment, net		-			234			-				234
Right of use assets		-			973			-				973
Other long-term assets		-			1,906			-				1,906

TOTAL ASSETS	$	6,881		$	15,770		$	3,735			$	26,386

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	-		$	2,060			-			$	2,060
Customer deposits		-			1,704			-				1,704
Notes payable, current portion, net of discount		85			9			(85	)	C		9
Notes payable to related parties, current portion		2,065			1,237			(2,065	)	D		1,237
Line of credit		-			803			-				803
Line of credit margin account		-			1,981			-				1,981
Convertible notes payable, net		-			955			10,540		E		11,495
Accrued interest		-			460			-				460
Accrued and other current liabilities		1,492			1,125			(1,492	)	F		1,125
Accrued and other current liabilities - related parties		6			-			(6	)	G		-
Taxes payable		57			-			-				57
Lease liability, current portion		-			334			-				334

Total current liabilities		3,705			10,668			6,892				21,265

Non-current liabilities:
Notes payable, net of current portion		-			2,404			-				2,404
Note payables to related parties, net of current portion		-			861			-				861
Dividends notes payable		-			4,024			-				4,024
Gross sales royalty payable		-			1,000			-				1,000
Lease liability, net of current portion		-			668			-				668
Other liabilities		-			63			-				63
Deferred underwriting commissions		4,428			-			(4,428	)	H		-

Total liabilities		8,133			19,688			2,464				30,285

COMMITMENTS AND CONTINGENCIES
Common stock subject to redemption		6,537			-			(6,537	)	I		-

STOCKHOLDERS’ (DEFICIT) EQUITY

Preferred stock		-			-			-				-
Common stock Class A Common stock		-			-			1		J		1
Class B Common stock		-			-			-				-
Additional paid in capital		-			10,480			(614	)	K		9,866
Treasury stock		-			(2,037	)		-				(2,037	)
Accumulated other comprehensive income		-			(2	)		-				(2	)
Accumulated deficit		(7,789	)		(12,359	)		8,421		L		(11,727	)

Total stockholders’ (deficit) equity		(7,789	)		(3,918	)		7,808				(3,899	)

TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	6,881		$	15,770		$	3,735			$	26,386

See accompanying notes to the unaudited pro forma condensed combined financial information.

Pro Forma Condensed Combined Statement of Operations

For the year ended December 31, 2023

Unaudited

(Amounts in thousands of US$, except for number of shares and per share data)

	DMA			TruGolf Nevada			Transaction Accounting adjustment				Pro Forma Balance Sheet

Revenues	$	-		$	20,584		$	-			$	20,584
Cost of revenues		-			(7,826	)		-				(7,826	)
Gross loss		-			12,758			-				12,758

Operating expenses:
Royalties		-			710			-				710
Franchise taxes		144			-			-				144
Salaries, wages and benefits		60			9,681			-				9,741
Selling, general and administrative		1,709			11,027			200		(AA)		12,936
Total operating expenses		1,913			21,418			200				23,531

Income from operations		(1,913	)		(8,660	)		(200	)			(10,773	)

Other income (expenses):
Interest expense		-			(1,731	)		632		(BB)		(1,099	)
Interest income		-			108			-				108
Loss on investment		-			-			-				-
Government grant		-			-			-				-
Other expenses		-			-			-				-
Investment income (loss) on investments held in Trust Account		352			-			55		(CC)		407
Total other income		352			(1,623	)		687				(584	)

(Loss) income before income taxes		(1,561	)		(10,283	)		487				(11,357	)

Income tax		-			-			43		(DD)		43

Net (loss)	$	(1,561	)	$	(10,283	)	$	444			$	(11,400	)

Other Comprehensive Income:

Unrealized gain in fair value of short-term investment		-			-			-				-

Comprehensive (loss) Income	$	-		$	(10,283	)	$	-			$	(11,400	)

Net loss per share
Basic and diluted - Class A	$	(0.35	)	$	(857.35	)					$	(0.99	)
Basic and diluted - Class B		N/A			N/A						$	(6.64	)

Weighted average number of shares
Basic - Class A		4,493,035			11,994			7,065,218		(EE)		11,558,253
Diluted - Class A		4,493,035			11,994			21,856,809				26,349,844
Basic and diluted - Class B		-			-			1,716,860				1,716,860

See accompanying notes to the unaudited pro forma condensed combined financial information.

Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet

The adjustments included in the unaudited pro forma condensed combined balance sheet as of December 31, 2023 are as follows:

(A) Represents pro forma adjustments to cash to reflect the following:

(Amounts in thousands of US$)
Release of the investments held in the Trust Account to cash and cash equivalents	$	2,392		(1)
Repayment to sponsor’s loan		(2,065	)	(2)
Payment of legal fees, and other DMA transaction-related fees		(2,901	)	(3)
Payment of accrued expenses and tail insurance premium		(585	)	(4)
Payment of legal fees, and other TruGolf Nevada transaction-related fees		(175	)	(5)
Proceeds from the convertible debt financing at closing		13,815		(6)
Income tax payment		(43	)	(7)
	$	10,438

	(1)	Reflects the reclassification of $2.4 million of cash held in the Trust Account at Closing after the redemption of 379,687 shares of DMA Class A common stock at a redemption price of $11.50 per share for an aggregate redemption of $4.4 million.

	(2)	Reflects the repayments of the unsecured promissory notes in an aggregate principal amount of $2,065,000, which is comprised of: (i) an unsecured promissory note in the principal amount of $500,000 issued to the Sponsor on March 15, 2021 in connection with a portion of the IPO expense; (ii) an unsecured promissory note in the principal amount of $1,265,000 issued to two affiliates of the Sponsor on October 15, 2022 in connection with the First Extension, from October 29, 2022 to January 29, 2023; and (iii) an unsecured promissory note in the principal amount of $300,000 issued to an affiliate of the Sponsor on February 9, 2023 in connection with the Second Extension, from January 29, 2023 to July 29, 2023, pursuant to which a monthly payment of $50,000 had been deposited into the Trust Account after January 29, 2023 for six months. Pursuant to the fully executed Promissory Notes, each of the Promissory Notes bears no interest and is due and payable upon the earlier of the consummation of DMA’s initial business combination or the date of the liquidation of DMA.

	(3)	Reflects the settlement of $2.9 million of DMA transaction costs at Closing due to advisory, legal and other acquisition-related transaction costs incurred. The acquisition-related transaction costs are accounted for as equity issuance costs and the unaudited pro forma balance sheet reflects these costs as a reduction of cash with a corresponding decrease to additional paid in capital.

	(4)	Reflects the payment of expenses due at Closing, such as tail insurance premium, which were excluded from acquisition-related transaction costs and charged to expenses in the unaudited pro forma statements of operations, including the repayment to the accrued expenses as of December 31, 2023, and the repayment to a promissory note of $84,617, which was issued to a third party in connection with the premium payment for DMA’s Directors and Officers insurance.

	(5)	Reflects the settlement of $175,000 of TruGolf Nevada transaction costs at close in connection with the Business Combination, representing advisory, legal and other acquisition-related transaction costs incurred. The acquisition-related transaction costs are accounted for as equity issuance costs and the unaudited pro forma balance sheet reflects these costs as a reduction of cash with a corresponding decrease to additional paid in capital.

	(6)	Reflects the proceeds of $13.8 million from the convertible notes, net of 10% OID, pursuant to the securities purchase agreements executed on February 2, 2024.

	(7)	We estimate our income tax obligations for the year ended December 31, 2023, which we shall pay from interest earned on the funds held in our Trust Account and released to us for this purpose.

(B) Reflects the reclassification of $2.4 million of cash held in the Trust Account at Closing after the redemption of 379,687 shares of DMA Class A common stock at a redemption price of $11.50 per share for an aggregate redemption of $4.4 million. The breakdown is set forth in the following table.

(Amounts in thousands of US$)
Release of the investments held in the Trust Account to cash and cash equivalents at Closing	$	(2,392	)
Investment income on investments held in Trust Account subsequent to December 31, 2023 and up to Closing		55
The redemption of 379,687 shares of DMA Class A common stock at a redemption price of $11.50 per share for an aggregate redemption of $4.4 million		(4,366	)

	$	(6,703	)

(D) Reflects the repayments of the unsecured promissory notes in an aggregate principal amount of $2,065,000, which is comprised of: (i) an unsecured promissory note in the principal amount of $500,000 issued to the Sponsor on March 15, 2021 in connection with a portion of the IPO expense; (ii) an unsecured promissory note in the principal amount of $1,265,000 issued to two affiliates of the Sponsor on October 15, 2022 in connection with the First Extension, from October 29, 2022 to January 29, 2023; and (iii) an unsecured promissory note in the principal amount of $300,000 issued to an affiliate of the Sponsor on February 9, 2023 in connection with the Second Extension, from January 29, 2023 to July 29, 2023, pursuant to which a monthly payment of $50,000 was deposited into the trust account after January 29, 2023, which was totaled $100,000 as of March 31, 2023, and $200,000 deposited after March 31, 2023. Pursuant to the fully executed Promissory Notes, each of the Promissory Notes bears no interest and is due and payable upon the earlier of the consummation of DMA’s initial business combination or the date of the liquidation of DMA.

(E) Represents pro forma adjustments to the convertible notes, pursuant to the securities purchase agreements executed on February 2, 2024 and the warrant cancellation agreements executed on July 10, 2023.

(Amounts in thousands of US$)
Convertible debt funded at Closing	$	15,500		(1)
10% Original Issuance Discount		(1,550	)	(2)
Debt discount due to the warrants granted		(3,325	)	(3)
Debt discount due to legal fees		(135	)	(4)
Reversal of debt discount		50		(5)
	$	10,540

	(1)	Reflects the principal of certain convertible debt financing in amount of $15.5 million pursuant to the securities purchase agreements executed on February 2, 2024.
	(2)	Reflects the 10% Original Issuance Discount pursuant to the agreements set forth in footnote (1).
	(3)	Reflects the fair value of 1,409,091 Series A warrants and 1,550,000 Series B warrants granted to the debt holders pursuant to the agreements set forth in footnote (1). The initial exercise price of the Series A Warrants shall be $13.00 per share for five years after the Closing, the fair value of the Series A Warrants was estimated to be approximately $2.28 million (or $1.61 per warrant) using the Black-Scholes option-pricing model as of the grant date based on the following assumptions: (1) expected volatility of 227.52%, (2) risk-free interest rate of 3.99% and (3) expected life of five years. The initial exercise price of the Series B Warrants shall be $10.00 per share for 30 months after the Closing, the fair value of the Series B Warrants was estimated to be approximately $2.15 million (or $1.38 per warrant) using the Black-Scholes option-pricing model as of the grant date based on the following assumptions: (1) expected volatility of 227.52%, (2) risk-free interest rate of 4.36 % and (3) expected life of 30 months.
	(4)	Reflects the legal fee related to the debt financing.
	(5)	Reflects the reversal of unamortized debt discount due to the cancellation of warrants, which was granted to TruGolf Nevada existing convertible debt holders in 2022. Pursuant to the Warrant Cancellation Agreements entered into on July 10, 2023 between TruGolf Nevada and the warrants holders, these warrants shall be cancelled at Closing of the Business Combination.

(F) Reflects the reduction in accrued liabilities related to DMA transaction costs after the payment to legal, financial advisory and other professional fees at Closing of the Business Combination.

(G) Reflects the reduction in accrued liabilities due to related parties after the cash payment of $10,000 and the issuance of 280,000 shares of DMA Common Stock to DMA’s officers and directors at Closing of the Business Combination. This stock issuance was granted at DMA’s incorporation. The fair value of this stock issuance was determined by the fair value of the DMA’s Common Stock on the grant date, at a price of $0.02 per share.

(H) Reflects the payment of transaction fee pursuant to the BCMA Amendment due at Closing, which was payable to I-Bankers a transaction fee consisting of (i) $2,000,000 in cash and (ii) 212,752 New TruGolf Class A Common Shares.

(I) Reflects the reclassification of approximately $2.4 million of DMA Common Stock subject to possible redemption to permanent equity after the redemption of 379,687 shares of DMA Class A common stock at a redemption price of $11.50 per share for an aggregate redemption of $4.4 million.

(J) Represents pro forma adjustments to reclassify TruGolf Nevada Stockholders equity to paid in capital at Closing of the Business Combination, assuming the conversion of all DMA Rights, DMA Common Shares have been issued to I-Bankers and DMA’s officers and directors, and based on funds in the Trust Account available to DMA outside of the Trust Account at Closing, and all upon the terms and subject to the conditions set forth in the Merger Agreement, but does not take into account (i) any shares reserved for issuance under the Incentive Plan, or (ii) the issuance of any shares relating to any additional Private Placement Units that are issued or issuable to our Sponsor pursuant to the conversion of the Sponsor’s up to $1.5 million working capital loans that were made to DMA.

(K) Represents pro forma adjustments to additional paid-in capital balance to reflect the following:

(Amounts in thousands of US$)
Common stock subject to redemption after consider the non-realized gain up to Closing and the actual redemption	$	2,226
Reclassification of DMA’s historical retained earnings to additional paid in capital as part of the reverse recapitalization		(7,887	)
Reduction in additional paid-in capital for acquisition related transaction expenses, net of accrual		(280	)
Issuance of 280,000 shares to DMA’s officer and directors		6
Shares issuance to Ellenoff Grossman & Schole LLP as fees for their services due at Closing		250
Shares issuance to I-Bankers to settle $2,427,500 of deferred underwriters’ fees due at Closing		2,428
Fair value of the 1.4 million Series A warrants and 1.5 million Series B warrants granted in connection with the convertible notes described in (E)(3) above, which was executed on February 2, 2024		3,325
Cancellation of warrants at Closing, in connection with TruGolf Nevada existing convertible notes, pursuant to the Warrant Cancellation Agreements described in (E)(5) above.		(682	)
	$	(614	)

(L) Represents pro forma adjustments to accumulated deficit balance to reflect the following:

(Amounts in thousands of US$)
Reclassification of DMA’s historical accumulated deficit to additional paid in capital as part of the reverse recapitalization	$	7,886
Reflects the estimated income tax payment		(43	)
Reflects the payment of expenses due at Closing, such as tail insurance premium		(200	)
Reflects the decrease in accrued expenses due to discounts		146
Reversal of expenses due to warrants cancellation at Closing, in connection with TruGolf Nevada existing convertible notes, pursuant to the Warrant Cancellation Agreements described in (E)(5) above.		632
	$	8,421

Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations

The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the twelve months ended December 31, 2023 are as follows:

(AA) Reflects the payment of expenses due at Closing, such as tail insurance premium, was expensed at the Closing. These costs are a non-recurring item that are not expected to recur in the next 12 months.

(BB) Represents pro forma adjustment to reflect the cancellation of warrants at the Closing of the Business Combination, in connection with TruGolf Nevada existing convertible notes. Pursuant to the Warrant Cancellation Agreements entered into on July 10, 2023 between TruGolf Nevada and the warrants holders, these warrants shall be cancelled at Closing of the Business Combination.

(CC) Reflects the unrealized gain on marketable securities held in the Trust Account up to the Closing.

(DD) Reflects the estimated income tax liabilities due to the interest income from marketable securities held in the Trust Account.

(EE) The pro forma basic and diluted net loss per share amounts presented in the unaudited pro forma condensed combined statements of operations are based on the number of New TruGolf shares outstanding as if the Business Combination had occurred at the beginning of the earliest period presented.

Pro Forma weighted-average shares outstanding—basic and diluted is calculated as follows for the twelve months ended December 31, 2023:

Weighted-average shares outstanding—basic and diluted

	Accrual Redemptions
	Number of Shares Owned

Assume conversion of DMA Class A common stock into New TruGolf common stock effective January 1, 2023 as a result of assuming closing of the Business Combination on January 1, 2023		4,327,902
Assume reclassification of common stock subject to possible redemption to New TruGolf common stock effective January 1, 2023 as a result of assuming closing of the Business Combination on January 1, 2023		1,460,077
Assume on January 1, 2023 issuance of New TruGolf common stock to TruGolf Nevada shareholders as a result of assuming closing of the Business Combination on January 1, 2023		5,750,274
Assume on January 1, 2023 issuance of New TruGolf common stock to pay for the legal fee		20,000

Weighted average shares outstanding – Class A		11,558,253

	Accrual Redemptions
	Number of Shares Owned

Assume on January 1, 2023 issuance of New TruGolf common stock to TruGolf Nevada shareholders as a result of assuming closing of the Business Combination on January 1, 2023		1,716,860

Weighted average shares outstanding – Class B		1,716,860

The following potentially dilutive instruments were not included in the calculation of weighted-average shares outstanding for the twelve months ended December 31, 2023 as their effects would have been anti-dilutive:

	Accrual Redemptions

PIPE Convertible Notes (1)		6,700,000
Series A Warrants (1)		1,409,091
PIPE Series B Warrants (1)		1,550,000
Earnout Shares (2)		4,500,000
Underwriter warrants (3)		632,500
Total		14,791,591

(1) Pursuant to the terms and conditions of the Securities Purchase Agreements dated on February 2, 2024, the PIPE Investors agreed to purchase from the Company (i) senior convertible notes in the aggregate principal amount of up to $15,500,000 (the “PIPE Convertible Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class A common stock (the “Series A Warrants”); and (iii) Series B warrants to initially purchase 1,550,000 shares of the Company’s Class A common stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”) (the “PIPE Financing”).

Each holder of Notes may convert all, or any part, of the outstanding Notes, at any time at such holder’s option, into shares of our Class A common stock at an initial “Conversion Price” of $10.00 per share, which is subject to proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions. Upon the voluntary conversion by the holders of the PIPE Convertible Notes, in addition to the issuance of the Class A common stock issuable upon conversion of the principal amount of PIPE Convertible Notes, the Company shall issue to the holders in Class A common stock the sum of (A) all accrued interest on the PIPE Convertible Notes to date plus (B) all interest that would otherwise accrued on such principal amount of the PIPE Convertible Notes if such converted principal would be held to the Maturity Date at the Conversion Price.

The initial conversion price (the “Conversion Price”) of the PIPE Convertible Notes is $10.00 per share; provided that the Conversion Price will be automatically reduced to the applicable Adjustment Price (as defined below) if on (i) the 45th calendar day after the initial issuance date, and/or (ii) the date the Registration Statement (as described below) is declared effective by the SEC (each, an “Adjustment Measuring Date”), the greater of (A) $2.00 with respect to $5.0 million in principal amount of PIPE Convertible Notes and $2.50 with respect to the remainder of the PIPE Convertible Notes (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events), and (B) the lowest volume weighted average price (“VWAP”) on any trading day during the five trading day period ended, and including, the trading day immediately prior to such applicable Adjustment Measuring Date (each, an “Adjustment Price”), is less than the Conversion Price then in effect.

The Series A Warrants shall expire five years after issuance and shall initially be exercisable for an aggregate of 1,409,091 shares of Class A common stock, which number of shares shall be increased each time the holder exercises any Series B Warrants in an amount equal to 91% of the shares of Class A common stock issued pursuant to such Series B Warrant exercise. The initial exercise price of the Series A Warrants shall be $13.00 per share; provided that if on (A) the 45th calendar day after issuance, and/or (B) the date the Registration Statement (as described below) is declared effective by the SEC (each, a “Warrant Adjustment Measuring Date”), the exercise price then in effect is greater than the greater of (i) $4.00 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events), and (ii) the lowest VWAP on any trading day during the five trading day period ended, and including, the trading day immediately prior to such applicable Warrant Adjustment Measuring Date, the exercise price shall automatically lower to such price.

The Series B Warrants shall expire 30 months after issuance and shall initially be exercisable for an aggregate of 1,550,000 shares of Class A common stock. The initial exercise price of the Series B Warrants shall be $10.00 per share.

(2) At the Closing, subject to the terms and conditions set forth herein, the Company Stockholders shall receive the contingent right to receive up to an additional 4,500,000 shares of Purchaser Class A Common Stock. Assumes the earnout measurements will be met:

a) The First Tranche of a maximum of 1,000,000 Earnout Shares will be earned as follows (i) in the event that the gross consolidated gross revenue of New TruGolf and its subsidiaries (the “ Gross Revenues”) for 2024 equals or exceeds Thirty Million Dollars ($30,000,000)but is less than Forty Two Million Dollars ($42,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the First Tranche or (y) in the event that the Gross Revenues for 2024 equals or exceeds Forty Two Million Dollars ($42,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the First Tranche; or (ii) in the event that the dollar volume-weighted average price(“VWAP”) of the DMA Class A Shares is at least $13.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to received100% of the First Tranche or, in the event that ten (10) or more Qualified Franchise Locations (as defined in the Merger Agreement) are opened prior to the end of the calendar year 2024, then the TruGolf Nevada Stockholders shall be entitled to received100% of the First Tranche.

b) The Second Tranche of a maximum of 1,500,000 Earnout Shares will be earned as follows (i) in the event that the Gross Revenues for2025 equals or exceeds Fifty Million Dollars ($50,000,000) but is less than Sixty Five Million Dollars ($65,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the Second Tranche or (y) in the event that the Gross Revenues for 2025 equals or exceeds Sixty Five Million Dollars ($65,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche; or (ii) in the event that the VWAP of DMA Class A Shares is at least $15.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche or, in the event that thirty (30) or more Qualified Franchise Locations are opened prior to the end of the calendar year 2025, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Second Tranche.

c) The Third Tranche of a maximum of 2,000,000 Earnout Shares will be earned as follows (i) in the event that the Gross Revenues for2026 equals or exceeds Eighty Million Dollars ($80,000,000) but is less than One Hundred Million Dollars ($100,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 50% of the Third Tranche or (y) in the event that the Gross Revenues for 2026 equals or exceeds One Hundred Million Dollars ($100,000,000), then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche; or (ii) in the event that the VWAP of DMA Class A Shares is at least $17.00 per share for at least twenty (20) out of thirty (30) trading days in the specified period, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche or, in the event that fifty (50) or more Qualified Franchise Locations are opened prior to the end of the calendar year 2026, then the TruGolf Nevada Stockholders shall be entitled to receive 100% of the Third Tranche.

(3) The Company issued to I-Bankers a five-year warrant to purchase 632,500 Shares of Class A common stock, equal to 5.0% of the Shares issued in the IPO (“Representative Warrants”). The exercise price of Representative Warrants is $12.00 per Share.

Cover	Apr. 17, 2024
Cover [Abstract]
Document Type	8-K/A
Amendment Flag	true
Amendment Description	This Amendment No. 1 to the Current Report on Form 8-K/A (the “Amendment”) is being filed with the Securities and Exchange Commission (“SEC”) to amend the Current Report filed by TruGolf Holdings, Inc. (the “Company”) on February 6, 2024 (the “Original 8-K”) and to provide certain additional information.
Document Period End Date	Apr. 17, 2024
Entity File Number	001-40970
Entity Registrant Name	TruGolf Holdings, Inc.
Entity Central Index Key	0001857086
Entity Tax Identification Number	85-3269086
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	60 North 1400 West Centerville
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84014
City Area Code	(801)
Local Phone Number	298-1997
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Class A Common Stock, $0.0001 par value per share
Trading Symbol	TRUG
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false

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