Enthusiast Gaming Holdings Inc. (“
Enthusiast
Gaming” or the
“Company”) (NASDAQ: EGLX)
(TSX: EGLX), a media and content platform for video game and
esports fans to connect and engage, is pleased to announce that the
Company has priced the offering (the “
Offering”)
at USD$5.75 per common share (the “
Common Shares”)
for aggregate gross proceeds to the Company of USD$46,000,000. In
connection with the offering the Company has entered into an
agreement with a syndicate of underwriters co-led by RBC Capital
Markets and Canaccord Genuity (the “
Lead
Underwriters”) as joint lead bookrunning managers, with B.
Riley Securities acting as joint bookrunner, and including Paradigm
Capital Inc., Scotia Capital Inc., Alliance Global Partners,
Colliers Securities LLC and Haywood Securities Inc., as co-managers
(together with the Lead Underwriters, the
“
Underwriters”).
Enthusiast Gaming and Blue Ant Media Inc.
(“Blue Ant”), one of the Company’s shareholders,
have also granted the Underwriters an option (the
“Over-Allotment Option”) to purchase an additional
1,200,000 Common Shares (the “Option Shares”)
representing in the aggregate up to 15% of the number of Common
Shares to be sold pursuant to the Offering, solely to cover the
Underwriters' over-allocation position, if any, and for market
stabilization purposes. The Over-Allotment Option will be
exercisable by the Underwriters for a period of 30 days following
the closing of the Offering. In the event the Over-Allotment Option
is exercised, the Company, the Underwriters and Blue Ant have
agreed that, at the option of Blue Ant (the “Tag-Along
Option”), up to 50% of the Option Shares may be comprised
of Common Shares to be sold by Blue Ant, with the remaining Option
Shares to be comprised of Common Shares to be issued and sold by
the Company (“Treasury Shares”). If the Tag-Along
Option is not exercised, the entire Over-Allotment Option will be
satisfied by the Company through the issuance of Treasury Shares.
Enthusiast Gaming will not receive any of the proceeds of any sale
of Common Shares by Blue Ant. Blue Ant will not otherwise
participate in the Offering.
The net proceeds from the Offering are expected
to be used by the Company primarily to strengthen its financial
position, inclusive of future acquisitions, working capital,
repayment of indebtedness and other general corporate purposes.
Completion of the Offering is subject to customary conditions and
the receipt of all necessary approvals, including the approval of
the TSX and NASDAQ. Closing is expected to occur on or about June
15, 2021.
In respect of the Offering, a prospectus
supplement (the “Prospectus Supplement”) to the
Company’s Canadian base shelf prospectus (the “Base
Prospectus”) dated May 6, 2021 will be filed in Canada
with applicable securities regulatory authorities, as well as in
the United States with the Securities and Exchange Commission (the
“SEC”) as part of the Company’s U.S. registration
statement.
The Common Shares will be offered in Canada and
the U.S. through the Underwriters either directly or, if
applicable, through their respective Canadian or U.S. registered
broker-dealer affiliates or agents, as applicable. The Offering is
being made concurrently in the U.S. and in all of the provinces and
territories of Canada, other than Québec, pursuant to the
multijurisdictional disclosure system implemented by the SEC and
the securities regulatory authorities in Canada. Offers may also be
made on a private placement basis where permitted by applicable
law. No Common Shares will be offered or sold in any jurisdiction
except by or through brokers or dealers duly registered under the
applicable securities laws of that jurisdiction, or in
circumstances where an exemption from such registered dealer
requirements is applicable.
This media release does not constitute an offer
to sell or the solicitation of an offer to buy the Common Shares.
Prospective investors should read the Base Prospectus, Prospectus
Supplement and the documents incorporated by reference therein
before investing in the Common Shares. These documents may be
accessed for free by visiting SEDAR www.sedar.com or EDGAR at
www.sec.gov.
Enthusiast Gaming is represented by Norton Rose
Fulbright Canada LLP in Canada and Norton Rose Fulbright US LLP in
the United States. The Underwriters are represented by Stikeman
Elliott LLP in Canada and Paul, Weiss, Rifkind, Wharton &
Garrison LLP in the United States.
About Enthusiast Gaming
Enthusiast Gaming is building the largest media
and content platform for video game and esports fans to connect and
engage worldwide. Combining the elements of its four core pillars;
Media, Talent, Esports and Experiences, Enthusiast Gaming provides
a unique opportunity and integrated approach to reach and connect
with its coveted GenZ and Millennial audience. Through its
proprietary mix of digital media and entertainment assets,
Enthusiast Gaming has built a vast network of like-minded
communities to deliver the ultimate fan experience.
Neither the TSX Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Exchange) accepts responsibility for the adequacy or accuracy
of this release.
This news release contains certain statements
that may constitute forward-looking information under applicable
securities laws. All statements, other than those of historical
fact, which address activities, events, outcomes, results,
developments, performance or achievements that Enthusiast Gaming
anticipates or expects may or will occur in the future (in whole or
in part) should be considered forward-looking information. Often,
but not always, forward-looking information can be identified by
the use of words such as "plans", "expects", "is expected",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", or "believes" or variations (including negative
variations) of such words and phrases, or statements formed in the
future tense or indicating that certain actions, events or results
"may", "could", "would", "might" or "will" (or other variations of
the forgoing) be taken, occur, be achieved, or come to pass.
Forward-looking statements are based on
assumptions and analyses made by the Company in light of its
experience and its perception of historical trends, current
conditions and expected future developments, including, but not
limited to, expectations and assumptions concerning: interest and
foreign exchange rates; capital efficiencies, cost saving and
synergies; growth and growth rates; the success in the esports and
media industry; and the Company’s growth plan. While Enthusiast
Gaming considers these assumptions to be reasonable, based on
information currently available, they may prove to be incorrect.
Readers are cautioned not to place undue reliance on
forward-looking statements. In addition, forward-looking statements
necessarily involve known and unknown risks, including, without
limitation, risks associated with general economic conditions; the
timing and filing of the Preliminary Supplement and Prospectus
Supplement and corresponding Registration Statement; the potential
offering of any securities by the Company; uncertainty with respect
to the completion of any future offering; the ability to obtain
applicable regulatory approvals for any contemplated offerings; the
ability of the Company to negotiate and complete future funding
transactions; adverse industry events; and future legislative, tax
and regulatory developments. Readers are cautioned that the
foregoing list is not exhaustive. For more information on the risk,
uncertainties and assumptions that could cause anticipated
opportunities and actual results to differ materially, please refer
to the public filings of Enthusiast Gaming which are available on
SEDAR at www.sedar.com. Readers are further cautioned not to place
undue reliance on forward-looking statements as there can be no
assurance that the plans, intentions or expectations upon which
they are placed will occur. Such information, although considered
reasonable by management at the time of preparation, may prove to
be incorrect and actual results may differ materially from those
anticipated. Forward-looking statements contained in this news
release are expressly qualified by this cautionary statement and
reflect our expectations as of the date hereof, and thus are
subject to change thereafter. Enthusiast Gaming disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by applicable law.
Contacts
Enthusiast Gaming Investor Relations:Eric
Bernofsky, Chief Corporate Officerinvestor@enthusiastgaming.com
Media Relations:Carmela Antolino, Provident
Communicationscarmela@providentcomms.com647-287-2286
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