St. Julians, Malta–(Newsfile Corp. – December 21, 2022) – Esports Entertainment Group, Inc. (NASDAQ: GMBL) (NASDAQ: GMBLP) (NASDAQ: GMBLW) (NASDAQ: GMBLZ) (or the “Company”) today announced that it has entered into a securities purchase agreement with the holder of its Senior Convertible Note (“Holder”) for the purchase and sale of 7,065,000 shares of the Company’s common stock and pre-funded warrants to purchase 17,850,000 shares of common stock in a registered direct offering at an effective purchase price of $0.0937 per share or per pre-funded warrant. Upon completion of the offering, the Holder will own approximately 9.9% of the outstanding common stock of the Company.

Jan Jones Blackhurst, Chair of the Company’s Board of Directors, said, “We are pleased to be working with a very important stakeholder to raise capital and build our business. We remain excited about the future and the possibilities ahead, and also look forward to naming a CEO in the very near term that will start our next chapter.”

Total gross proceeds from the offering, before deducting the offering expenses, was approximately $2.3 million. The pre-funded warrants are exercisable immediately upon issuance.

In a concurrent private placement, the Company is also issuing 100 shares of series B mirroring preferred stock (“Series B Preferred Stock”). At the next annual meeting of stockholders, the Company will call for the approval of, among other things, a proposal to effect a reverse stock split (“Reverse Stock Split Proposal”) of the Company’s common stock without a corresponding reduction in the authorized shares of common stock. The Series B Preferred Stock has voting rights on the Reverse Stock Split Proposal equal to 25,000,000 votes per share of Series B Preferred Stock, provided that any votes cast by the Series B Preferred Stock with respect to the Reverse Stock Split Proposal must be counted by the Company in the same proportion as the shares of common stock voted on this proposal. Each share of Series B Preferred Stock has a par value of $0.001 per share and a stated value of $1,000 and will be automatically redeemed by the Company upon stockholder approval of a reverse stock split of the Company’s shares of common stock.

The offerings closed on December 21, 2022. Pursuant to the Company’s plans to increase liquidity and maintain compliance with the Nasdaq Listing Rules, the Company anticipates raising additional funds in the near term either through a private placement or public offering of common stock.

The shares of common stock and pre-funded warrants sold by us have been registered pursuant to a registration statement on Form S-3 (File No. 333-252370), which the Securities and Exchange Commission (the “Commission”) declared effective on February 5, 2021. A final prospectus supplement and accompanying base prospectus relating to the offering were filed with the Commission on December 21, 2022, and are available at www.sec.gov.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

Additional information regarding the securities described above and the terms of the offering will be included in a Current Report on Form 8-K to be filed with the Commission.

About Esports Entertainment Group

Esports Entertainment Group (NASDAQ: GMBL) (EEG) is a full-service esports and online betting company. EEG focuses on three verticals: Games, iGaming, and Technology. EEG Games provides a wide array of services and infrastructure for businesses to engage esports and gaming communities around the world including Esports Gaming League (EGL), which hosts a community of more than 350,000 gamers on its proprietary tournament platform EGL.tv. EEG iGaming includes a number of award-winning brands covering traditional online sports book wagering needs as well as a multinational casino operator. EEG Technology builds next-generation platforms, features, and services for Millennials, Gen Z consumers, and brands looking to connect with these demographics. EEG has offices in New Jersey, Estonia, the United Kingdom, and Malta. For more information, visit www.esportsentertainmentgroup.com.

Forward-Looking Statements

The information contained herein includes forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, including statements relating to our intention to conduct an offering and sale of securities, the ability to complete the offering and expected use of proceeds. Forward-looking statements generally can be identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “will be,” “will continue,” “will likely result,” and similar expressions. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, and those discussed in other documents we file with the SEC, regarding our ability to continue as a going concern, our ability to regain compliance with Nasdaq Listing Rules, our significant indebtedness, and our obligations under our Senior Convertible Note. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, unless required by law. The safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 protects companies from liability for their forward-looking statements if they comply with the requirements of the Act.

Investor Relations Inquiries

[email protected]

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/149127