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
underwriters of the Company’s recently announced USD$46 million
public offering (the “
Offering”) of 8,000,000
common shares in the capital of the Company (the “
Common
Shares”) at a price of USD$5.75 per share (the
“
Offering Price”) have exercised their
over-allotment option (the “
Over-Allotment
Option”) in full to purchase an additional 1,200,000
Common Shares (the “
Option Shares”) at the
Offering Price. Enthusiast Gaming and Blue Ant Media Inc.
(“
Blue Ant”), one of the Company’s shareholders,
granted the Underwriters the Over-Allotment Option, solely to cover
the Underwriters' over-allocation position, if any, and for market
stabilization purposes.
Pursuant to the exercise of the Over-Allotment
Option, the Company offered and sold a total of 600,000 Common
Shares (the “OAO Treasury Offering”), and an
aggregate of 600,000 Common Shares were offered and sold by Blue
Ant resulting in aggregate gross proceeds of USD$6,900,000, with
the Company and the Selling Shareholder each receiving gross
proceeds of USD$3,450,000.
The net proceeds from the OAO Treasury Offering,
together with the 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, as more
particularly described in the final prospectus supplement dated
June 10, 2021 (the “Prospectus Supplement”), to
the Company’s Canadian base shelf prospectus dated May 6, 2021
(“Shelf Prospectus”) filed with applicable
securities regulatory authorities, as well as in the United States
with the Securities and Exchange Commission as part of the
Company’s U.S. registration statement on Form F-10 (the
“Registration Statement”). In connection with the
Offering, the principal amount of the vendor-take-back loan
(“VTB Note”) owing to Blue Ant that was incurred
in August 2020 by Enthusiast Gaming in connection with the
acquisition of Omnia Media Inc., and due on its maturity in August
2023, has been repaid together with accrued but unpaid interest. A
copy of the Prospectus Supplement and the Shelf Prospectus are
available on SEDAR at www.sedar.com and a copy of the Prospectus
Supplement and the Registration Statement are available on EDGAR at
www.sec.gov
Advisors
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
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.
MI 61-101
Disclosure Blue Ant is an insider of the
Company. Accordingly, the repayment of the VTB Note is considered a
“related party transaction” for purposes of Multilateral Instrument
61- 101 – Protection of Minority Security Holders in Special
Transactions (“MI 61-101”). Pursuant to MI 61-101,
the Company will file a material change report providing disclosure
in relation to the “related party transaction” on SEDAR under the
Company’s issuer profile at www.sedar.com. The Company did not file
the material change report more than 21 days before the repayment
date of the VTB Note as the details of such repayment were not
settled until shortly prior to the closing of the Offering, and the
Company wished to settle the terms thereof and close the Offering
on an expedited basis for business reasons.
Contacts
Enthusiast Gaming Investor Relations: Eric Bernofsky, Chief
Corporate Officer investor@enthusiastgaming.com
Media Relations: Carmela Antolino, Provident Communications
carmela@providentcomms.com 647-287-2286
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