Note 1  Background and Basis of Presentation Background GlassBridge Enterprises, Inc. owns and operates an asset management business and a sports investment platform through majority owned Adara Enterprises, Corp. f/k/a Imation Enterprises Corp. (Adara) and Sport-BLX, Inc. (SportBLX). Adara owns all of our asset management business, operated by Adara Asset Management, LLC and part of our SportBLX holdings. GlassBridge Asset Management LLC changed its name to Adara Asset Management LLC (AAM) in 2020. As used in this document, the terms GlassBridge, the Company, we, us, and our mean GlassBridge Enterprises, Inc. and its subsidiaries unless the context indicates otherwise. Basis of Presentation The financial statements are presented on a consolidated basis and include the accounts of the Company, its wholly-owned subsidiaries, and entities in which the Company owns or controls fifty percent or more of the voting shares and has the right to control. The results of entities disposed of are included in the Consolidated Financial Statements up to the date of the disposal and, where appropriate, these operations have been reflected as discontinued operations. Our Consolidated Financial Statements are prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). All inter-company balances and transactions have been eliminated in consolidation and, in the opinion of management, all normal recurring adjustments necessary for a fair presentation have been included in the results reported. The operating results of our legacy business segments, Consumer Storage and Accessories and Tiered Storage and Security Solutions (the Legacy Businesses) and the Nexsan Business (which includes the Nexsan Group as defined below), are presented in our Condensed Consolidated Statements of Operations as discontinued operations for all periods presented. Our continuing operations in each period presented represents our Asset Management Business, which consists of our investment advisory business conducted through AAM, as well as corporate expenses and activities not directly attributable to our Legacy Businesses or the Nexsan Business. Assets and liabilities directly associated with our Legacy Businesses and Nexsan Business and that are not part of our ongoing operations have been separately presented on the face of our Consolidated Balance Sheets for all periods presented. See Note 5 - Discontinued Operations for further information. On August 16, 2018, the Company consummated the NXSN Transaction, wherein the Company, through a series of transactions, sold its partially-owned subsidiary, the Nexsan Business, to StorCentric, Inc., a Delaware company affiliated with Drobo, Inc. See Note 5 - Discontinued Operations for further information. On March 31, 2019, the Company entered into a securities purchase agreement (the IMN Capital Agreement) with IMN Capital Holdings, Inc., a Delaware corporation (IMN Capital) whereby the Company sold its entire ownership of its international subsidiaries together with its entire ownership in Imation Latin America Corp., a Delaware corporation (the Imation Subsidiaries). Certain subsidiaries of the Company, including the Imation Subsidiaries, are parties to certain lawsuits, claims, and other legal proceedings concerning claims and counterclaims relating to excess payments made by the Imation Subsidiaries relating to copyright levies in European Union (EU) member states (the Subsidiary Litigation). Pursuant to the terms and subject to the conditions of the IMN Capital Agreement, IMN Capital acquired from the Company the Companys shares representing the Companys ownership interests in each of the Imation Subsidiaries (the Subsidiary Sale). Following the Subsidiary Sale, the Imation Subsidiaries are no longer affiliates of the Company, and the Company has no interest in or to the Imation Subsidiaries except as explicitly described in the IMN Capital Agreement. In consideration for the Subsidiary Sale, the Company shall receive certain compensation from IMN Capital. As defined in the IMN Capital Agreement, a payment occurrence is the settlement or final adjudication as to all demands, claims, counter-claims, cross-claims, third-party claims, damages, fees, costs and expenses, brought and raised on any matters arising from or related to the Subsidiary Litigation (a Payment Occurrence). In connection with the Subsidiary Sale, the purchase price furnished by IMN Capital to the Company (the Purchase Price) shall consist of (i) $277,900 payable upon the execution of the IMN Capital Agreement and (ii) 75% of all net proceeds from Subsidiary Litigation (which, for the avoidance of doubt, shall be calculated after the payment of (i) the retirement of the Germany pension liability; (ii) contingency fees payable to attorneys engaged in connection with the Subsidiary Litigation; (iii) fees payable to Mach 5, the litigation financing company and (iv) the payment of all applicable taxes including income taxes in connection with the Subsidiary Litigation) (such payment, the Contingent Payment). The Company recorded a one-time non-cash gain of approximately $10 million in connection with IMN Capital Agreement transaction. The Companys continued operations and ultimate ability to continue as a going concern will depend on its ability to enhance revenue and operating results, enter into strategic relationships or raise additional capital. The Company can provide no assurances that all or any of such plans will occur; and if the Company is unable to return to profitability or otherwise raise sufficient capital, there would be a material adverse effect on its business. On August 20, 2019, the Company effected a reverse split of our common stock, par value $0.01 per share at a ratio of 1:200 (the Reverse Stock Split). On August 21, 2019 (the Effective Date), our common stock began trading on the Reverse Stock Split-adjusted basis on the OTCQB at the opening of trading. In connection with the Reverse Stock Split, our common stock began trading with a new CUSIP number at such time. There was no change to the Companys stock symbol. All prior periods have been retroactively adjusted to give effect to the reverse stock split. See Note 12 - Shareholders Equity for further information.