Esports Entertainment Group Announces Agreement to Complete $4.3 Million Private Placement

St. Julians, Malta--(Newsfile Corp. - May 1, 2023) - Esports Entertainment Group, Inc. (NASDAQ:GMBL) (NASDAQ:GMBLP) (NASDAQ:GMBLW) (NASDAQ:GMBLZ) ("Esports Entertainment" or the "Company"), a leading, global iGaming company and business-to-business (B2B) esports content and solutions provider, today announced that it has entered into a securities purchase agreement to complete a private placement of new unsecured, Series D Convertible Preferred Stock with an institutional investor (the "Investor"), which is expected to provide the Company with net proceeds of approximately $4.0 million after estimated offering expenses. The private placement may also provide the Company with an opportunity for additional funding whereby the Investor would receive a warrant to purchase shares of common stock and a warrant to purchase additional shares of Series D Convertible Preferred Stock. The closing of the offering is expected to occur during the first week of May 2023, subject to customary and other closing conditions.

The Company previously announced that it had entered into an agreement with Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B ("Alto") to exchange the $15,230,024 in aggregate principal amount of the Company's Senior Convertible Note outstanding into 15,230 shares of the new unsecured Series C Convertible Preferred Stock (the "Exchange Transaction"). This exchange transaction was consummated on April 28, 2023, which will result in a significant reduction of its indebtedness.

The Company also reported that it now has stockholders' equity in excess of the Nasdaq Stock Market's minimum stockholders' equity requirement of $2,500,000 as set forth in Nasdaq listing rule 5550(b)(1) as a result of recent actions, including the aforementioned private placement and exchange of the Senior Convertible Note into unsecured Series C Convertible Preferred Stock, as well as the elimination of other debt and liabilities.

Alex Igelman, CEO of Esports Entertainment, stated, "We appreciate the additional investment in the Company, which not only bolsters our cash position but also complements the previously announced exchange of the Company's $15 million Senior Convertible Note into unsecured, Series C Convertible Preferred Stock. As a result of these transactions, we expect to have significantly enhanced our balance sheet. Moreover, we have eliminated over $4.0 million of annual operating expenses and project that we will have reduced debt and other liabilities by over $42 million, year to date. As a result, we are now positioning the Company to execute on our new, highly focused and capital efficient business model, targeting the growing iGaming, esports and e-simulator markets."

Certain issuances of shares of common stock upon conversion of the Series D Convertible Preferred Stock and common warrant are expected to require approval by the Company's stockholders pursuant to the rules and regulations of the Nasdaq Stock Market. In addition, the Company expects to grant the Investor certain registration rights with respect to shares of common stock it is issued upon conversion of shares of Series D Convertible Preferred Stock and exercise of the warrant to purchase common stock.

Maxim Group LLC is acting as the sole placement agent in connection with the offering.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy any of the Company's securities or any of the securities described herein, 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.

About Esports Entertainment Group

Esports Entertainment Group is a leading, global MGA-licensed, "esports-first" iGaming B2C operator and a US-focused B2B aggregator and supplier of esports solutions and e-simulator content. The Company owns and operates the world's leading esport venue management system, currently deployed in 810 global locations, including more than 100 colleges and universities. The Company's strategy is to capitalize on the multi-billion-dollar market for esports and esports wagering by leveraging its leading position in the industry. The Company is also targeting the rapidly growing market for e-simulator content, which features competitive, short-cycle head-to-head leagues that are optimized for betting. In addition to its plans to distribute esports content, the Company currently provides B2C-focused wagering through its MGA-licensed suite of brands. For additional information about the Company, please 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. 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 strategies, targeted markets, and 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, including, the ability to complete the transactions contemplated by the Securities Purchase Agreement, effectuate debt for equity exchanges, the conversion prices, and the timing and other terms of such exchanges. 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, including our ability to regain compliance with Nasdaq Listing Rules and stay listed on Nasdaq, our significant indebtedness, our obligations under our Senior Convertible Note, and our ability to continue as a going concern. 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 such Act.

Contact:
Crescendo Communications, LLC
Tel: (212) 671-1021
Email: [email protected]

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