Item
8.01 Other Events.
Anticipated
Closing of Merger and Asset Sale
NTN
and Brooklyn intend to complete the merger contemplated by the Merger Agreement (the “Merger”) within the next two
weeks. At the effective time of the Merger (the “Effective Time”), BIT Merger Sub, Inc., a wholly-owned subsidiary
of NTN, will merge with and into Brooklyn, with Brooklyn surviving as a wholly-owned subsidiary of NTN. Following the Effective
Time, the business conducted by NTN will become the business conducted by Brooklyn, which is a biopharmaceutical company focused
on exploring the role that cytokine-based therapy can have on the immune system in treating patients with cancer.
In
connection with and immediately prior to the Effective Time, NTN intends to (i) effect a reverse stock split at a ratio to be
determined within the range approved in Proposal 2, and (ii) change its name to “Brooklyn ImmunoTherapeutics, Inc.”
Further,
to allow the combined company following the closing of the Merger to focus its resources on Brooklyn’s business, as soon
as possible following the completion of the Merger, the parties intend to consummate the asset sale contemplated by the asset
purchase agreement dated September 18, 2020, as amended, between NTN and eGames.com Holdings LLC. As stated in the proxy statement/prospectus/consent
solicitation statement distributed in connection with the special meeting, as of immediately following the closing of the Merger,
the assets related to NTN’s historical business are not expected to constitute all or substantially all of the combined
company’s assets. Accordingly, following the completion of the Merger, all of the assets related to NTN’s historical
business may be sold without stockholder approval under Section 271 of the Delaware General Corporation Law, including to eGames.com
Holdings LLC under the asset purchase agreement.
Acquisition
of NTN Series A Convertible Preferred Stock by Brooklyn Members
Under
Section 351(a) of the Internal Revenue Code of 1986 (“Section 351(a)”), following the Merger, Brooklyn’s members
would be required to own at least 80% of the total combined voting power of all classes of stock of NTN that are entitled to vote,
and at least 80% of the total number of shares of each non-voting class of stock in NTN (i.e., Series A Convertible Preferred
Stock), in order for the Merger to qualify as a deferral of gain under Section 351(a).
So
that the Merger would qualify for deferral of gain under Section 351(a) even if the Series A Voting Rights Proposal was not approved
at the special meeting, certain members of Brooklyn have entered into binding agreements with the holders of more than 90% of
the outstanding shares of NTN’s Series A Convertible Preferred Stock pursuant to which the holders thereof agreed to sell
such shares to those Brooklyn members prior to the Merger, such that the Brooklyn members will hold at least 80% of the number
of outstanding shares of Series A Convertible Preferred Stock as of immediately after the Merger. Based on the foregoing,
NTN and Brooklyn agreed to waive the closing conditions in the Merger Agreement that NTN’s stockholders approve the Series
A Voting Rights Proposal and that NTN’s restated certificate of incorporation be amended to provide the holders of the outstanding
shares of NTN’s Series A Convertible Preferred Stock the right to vote on all matters submitted to a vote of the holders
of NTN’s common stock, voting together as one class with the holders of the common stock and any other class or series of
preferred stock so voting as one class, on an as converted to common stock basis.
On March 15, 2021,
NTN issued a press release announcing the foregoing information and the other information disclosed in this report, a copy of
which is furnished as Exhibit 99.1 and is incorporated by reference.
Forward-Looking Statements
This press release
contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are any statements that are not statements of historical
fact and may be identified by terminology such as “expect,” “intend,” “plan,” “believe,”
“anticipate,” “may,” “will,” “would,” “should,” “could,”
“contemplate,” “estimate,” “predict,” “potential” or “continue,” or
the negative of these terms or other similar words. Forward-looking statements are based on current beliefs and assumptions that
are subject to risks and uncertainties and are not guarantees of future performance. Forward-looking statements in this press
release include statements regarding the parties’ intent to complete the Merger, a reverse stock split and the asset sale,
and the timing thereof. Actual results could differ materially from those stated or implied in any forward-looking statement as
a result of various factors, including, but not limited to: (i) risks that the conditions to the closing of the proposed Merger
and/or asset sale are not satisfied, including the failure of NTN and Brooklyn to meet the net cash and capitalization requirements
under the Merger Agreement, as applicable; (ii) uncertainties as to the timing of the consummation of the proposed Merger and
asset sale and the ability of each party to consummate the proposed Merger and asset sale; (iii) risks related to NTN’s
and Brooklyn’s ability to manage their respective operating expenses and expenses associated with the proposed Merger and
asset sale, as applicable, pending closing of the Merger; (iv) the risk that, as a result of adjustments to the exchange ratio,
NTN stockholders and Brooklyn members could own more or less of the combined company than is currently anticipated; (v) NTN’s
continued listing on the NYSE American; (vi) uncertainties related to the impact of the COVID-19 pandemic on the business and
financial condition of NTN, Brooklyn and the combined company and the ability of NTN and Brooklyn to consummate the Merger and
NTN and eGames.com to consummate the asset sale; (vii) NTN’s ability to continue to operate as a going concern if the proposed
Merger or asset sale are not consummated in a timely manner, or at all; (viii) Brooklyn’s need for, and the availability
of, substantial capital in the future to fund its operations and research and development activities; (ix) Brooklyn’s ability
to successfully progress research and development efforts after the merger, including its manufacturing development efforts, and
to create effective, commercially-viable products; (x) the success of Brooklyn’s product candidates in completing pre-clinical
or clinical testing and being granted regulatory approval to be sold and marketed in the United States or elsewhere; (xi) the
outcome of any legal proceedings that have been instituted against NTN, Brooklyn, eGames.com or others related to the merger agreement
or the asset purchase agreement, as applicable; (xii) the occurrence of any event, change or other circumstance or condition that
could give rise to the termination of either or both of those agreements; (xiii) potential adverse reactions or changes to business
relationships resulting from the announcement or completion of the proposed merger or asset sale; and (xiv) those risks and uncertainties
discussed in NTN’s reports filed with the SEC, including its Annual Report on Form 10-K for the year ended December 31,
2020, its Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K, as well as other documents that may be filed by
NTN from time to time with the SEC available at www.sec.gov.