Trident Acquisitions Corp. (Nasdaq: TDACU,
TDAC, TDACW) ("Trident") and AutoLotto, Inc. (“Lottery.com”), a
leading online platform to play the lottery online or from a mobile
device, have entered into a definitive agreement for a business
combination that would result in Lottery.com becoming a publicly
listed company.
Founded in 2015, Lottery.com empowers users to play the lottery
from their phone and on the go. It offers official state-sanctioned
lottery games, like Powerball, Mega Millions and state games where
permissible. Lottery.com is also the world’s largest provider of
lottery data to over 400 digital publishers, including hundreds of
digital newspapers, television and news sites, and major digital
publishers such as Google, Verizon/Yahoo and Amazon’s Alexa
devices.
Lottery.com has been a pioneer in the lottery industry, working
closely with state regulators to advance the industry into the
digital age. Through its online platform, Lottery.com provides
official lottery games and enhanced regulatory capabilities by
developing innovative blockchain technology, while also capturing
untapped market share, including digitally native players.
With the expected proceeds to be received by Lottery.com upon
the closing of the transaction, Lottery.com would be
well-positioned to accelerate its revenue growth through further
expansion in its existing markets and into new high-growth markets
both domestically and internationally.
Lottery.com Investment
Highlights
- Potential to Significantly Expand
Global Market Share: Leveraging its
successful playbook in the U.S., Lottery.com intends to become a
global marketplace for legally available lottery games to consumers
across the world. At $430 billion of global lottery sales with only
4% online penetration, this is a large market opportunity that is
expected to shift to transact online during the next decade.
- Innovative Ecommerce Platform Bringing
an Outdated Industry into the Digital Age: Lottery.com has
developed a world-class safe and secure mobile lottery platform and
app leveraging blockchain technology to maintain an accurate ledger
that provides users the ability to play official lottery games and
other games of chance directly from their phone. Lottery.com has
benefited from a customer acquisition cost of $4.01, with those
users producing an average of $30.90 of gross revenue in their
first year.
- Favorable Macro Dynamics Driving Consumers
Online: Betting and gambling industries have begun
successfully transitioning to online platforms as pandemic-related
changes in consumer behavior have accelerated online and digital
adoption. In addition, millennials are increasingly participating
in games of chance, including the lottery.
- Easing Regulatory Environment Propelling Market
Growth: Many states and international governments have
been easing restrictions on lottery games in an effort to increase
ticket sales and revenue contribution in the form of tax as more
and more gaming companies collaborate on lobbying efforts.
- Poised for Expansion: From 2016 to 2020,
Lottery.com grew gross revenue at a compounded annual growth rate
of 322%, and forecasts gross revenue equal to approximately $71
million in 2021, $280 million in 2022 and $571 million in 2023.
Lottery.com is currently operating in 11 states across the U.S. and
has plans to cover 34 states by the end of 2023. Lottery.com looks
forward to announcing upcoming partnerships with significant room
to expand into other countries, along with opportunities to grow
deeper within its current footprint.
- Large and Growing Player
Pool for Cross Selling Additional Games: With over 7.5
million visitors in 2020, the Lottery.com platform is capable of
distributing a range of wagering and games of chance across large
and growing national and international
markets.
“Lottery.com’s innovative platform has already
made significant progress bringing the lottery industry into the
digital age and continuing to expand its markets both domestically
and internationally,” said Vadim Komissarov, CEO of Trident. “With
a track record of substantial growth and user base expansion in a
relatively short period of time, we are confident that Lottery.com
has the ability to cement its place as a leading online platform to
both play the lottery and to introduce additional wagering and
games of chance worldwide. We believe this transaction will allow
Lottery.com to be on a path to reach its true growth potential, and
we look forward to working with the team as we introduce their
compelling story to the public markets.”
Co-founder and CEO of Lottery.com, Tony
DiMatteo, commented: “Lottery.com is innovating a legacy industry
with ground-breaking technologies poised to capitalize on the large
population of active internet and smartphone users in the U.S. and
throughout the world. Over the past several months, we have made
significant progress, launching our app in the Google Play Store
and expanding domestically into Colorado and internationally
through announced partnership plans in Turkey and Ukraine. We
believe this transaction will further enhance our ability to grow
into new markets as consumers are now, more than ever, engaging
with digital and online platforms. The team at Trident shares our
vision of growing into a global marketplace for legally available
lottery games, and other games of chance, to consumers across the
world and we firmly believe this partnership will accelerate our
growth.”
Lottery.com is expected to continue to be
supported by a strong advisory board and notable investors within
the venture capital, gaming and entertainment industries,
including:
- Jason Robins, CEO of DraftKings
(Nasdaq: DKNG)
- Peter Diamandis, Chairman of XPRIZE
Foundation
- Ben Narasin, Venture Partner of
NEA
- Paraag Marathe, Enterprises
President and EVP of Football Operations
- Matthew Le Merle, Co-founder and
Managing Partner of Fifth Era and Keiretsu Capital
- Jamie Gold, The Poker
Philanthropist
"We were early investors into Lottery.com
because we recognized the commitment to win in Tony and Matt, and
the opportunity Lottery.com has to become the trusted brand in the
space,” said San Francisco 49ers Enterprises President and EVP of
Football Operations Paraag Marathe, “I am excited for the next
phase of the business, and believe the future is bright for
Lottery.com.”
Transaction Terms The combined company will
have an estimated post-business combination enterprise value of
approximately $526 million.
The net proceeds raised from the business
combination will be used to support Lottery.com’s working capital
and global platform expansion.
The proposed business combination contemplates
that Lottery.com’s stockholders will roll 100% of their equity into
the combined company, with no minimum cash requirement to close the
business combination.
Upon completion of the transaction, the combined
company will be trademarked Lottery.com and its common stock is
expected to remain listed on the Nasdaq Stock Market under the new
ticker symbol “LTRY.”
For a summary of the material terms of the
proposed transaction, please see Trident’s Current Report on Form
8-K to be filed with the U.S. Securities and Exchange Commission
(the “SEC”) in connection with the announcement of the proposed
business combination. An investor presentation will be published at
a later date.
AdvisorsWhite & Case LLP is
serving as legal advisor to Lottery.com. B. Riley Securities and
Chardan are acting as co-capital markets advisors and financial
advisors, and Loeb & Loeb is acting as legal advisor to
Trident.
About Lottery.comLottery.com
is an Austin, TX-based company enabling consumers to play
state-sanctioned lottery games from their home or on the go in the
US, and select lottery products internationally. The company works
closely with state regulators to advance the lottery industry,
providing official lottery games and enhanced regulatory
capabilities, while capturing untapped market share, including
millennial players. Lottery.com is also gamifying charitable giving
to fundamentally change how nonprofits engage with their donors and
raise funds. Through their WinTogether.org platform, they offer
charitable donation sweepstakes to incentivize donors to take
action by offering once in a lifetime experiences and large cash
prizes.
About Trident Acquisitions
Corp.Trident Acquisitions Corp. is a special purpose
acquisition company formed for the purpose of entering into a
merger, share exchange, asset acquisition, stock purchase,
recapitalization, reorganization or other similar business
combination with one or more businesses or entities. Trident's
securities are listed on the Nasdaq stock exchange under the ticker
symbols TDACU, TDAC and TDACW. For more information, visit
tridentacquisitions.com.
Forward Looking StatementsThe
information in this press release includes "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. All statements, other than statements of
present or historical fact included in this presentation, regarding
the proposed business combination between Trident and Lottery.com,
Trident and Lottery.com's ability to consummate the transactions,
the benefits of the transactions, Lottery.com’s estimated revenue
growth, operational and state expansion, and the combined company's
future financial performance, as well as the combined company's
strategy, future operations, estimated financial position,
estimated revenues and losses, projected costs, prospects, plans
and objectives of management are forward-looking statements. When
used in this press release, the words "could," "should," "will,"
"may," "believe," "anticipate," "intend," "estimate," "expect,"
"project," the negative of such terms and other similar expressions
are intended to identify forward-looking statements, although not
all forward-looking statements contain such identifying words.
These forward-looking statements are based on management's current
expectations and assumptions about future events and are based on
currently available information as to the outcome and timing of
future events. Except as otherwise required by applicable law,
Trident and Lottery.com disclaim any duty to update any
forward-looking statements, all of which are expressly qualified by
the statements in this section, to reflect events or circumstances
after the date of this press release. Trident and Lottery.com
caution you that these forward-looking statements are subject to
numerous risks and uncertainties, most of which are difficult to
predict and many of which are beyond the control of either Trident
or Lottery.com. In addition, Trident cautions you that the
forward-looking statements contained in this press release are
subject to the following factors: (i) the occurrence of any event,
change or other circumstances that could delay the business
combination or give rise to the termination of the agreements
related thereto; (ii) the outcome of any legal proceedings that may
be instituted against Trident or Lottery.com following announcement
of the proposed business combination; (iii) the inability to
complete the business combination due to the failure to obtain
approval of the stockholders of Trident, or other conditions to
closing in the business combination agreement; (iv) the risk that
the proposed business combination disrupts Lottery.com's current
plans and operations as a result of the announcement of the
transactions; (v) Lottery.com's ability to realize the anticipated
benefits of the business combination, which may be affected by,
among other things, competition and the ability of Lottery.com to
grow and manage growth profitably following the business
combination; (vi) costs related to the business combination; (vii)
risks related to the rollout of Lottery.com's business and the
timing of expected business milestones; (viii) Lottery.com's
dependence on obtaining and maintaining lottery retail licenses or
consummating partnership agreements in various markets; (ix)
Lottery.com's ability to maintain effective internal controls over
financial reporting, including the remediation of identified
material weaknesses in internal control over financial reporting
relating to segregation of duties with respect to, and access
controls to, its financial record keeping system, and Lottery.com's
accounting staffing levels; (x) the effects of competition on
Lottery.com's future business; (xi) risks related to Lottery.com's
dependence on its intellectual property and the risk that
Lottery.com's technology could have undetected defects or errors;
(xii) changes in applicable laws or regulations; (xiii) the
COVID-19 pandemic and its effect on Lottery.com and the economy
generally; (xiv) risks related to disruption of management time
from ongoing business operations due to the proposed business
combination; (xv) risks relating to privacy and data protection
laws, privacy or data breaches, or the loss of data; and (xvi) the
possibility that Lottery.com may be adversely affected by other
economic, business, and/or competitive factors. Should one or more
of the risks or uncertainties described in this press release
materialize or should underlying assumptions prove incorrect,
actual results and plans could differ materially from those
expressed in any forward-looking statements. Additional information
concerning these and other factors that may impact the operations
and projections discussed herein can be found in the reports that
Trident has filed and will file from time to time with the SEC,
including its Annual Report on Form 10-K for the fiscal year ended
December 31, 2019. Trident's SEC filings are available publicly on
the SEC's website at www.sec.gov.
Important Information and Where to Find
itIn connection with the proposed business combination,
Trident will file with the SEC a registration statement on Form S-4
(the “Registration Statement”) that will include a preliminary
proxy statement (the "Proxy Statement") for the solicitation of
proxies from Trident's stockholders. Additionally, Trident will
file other relevant materials with the SEC in connection with the
proposed business combination. Copies may be obtained free of
charge at the SEC's web site at www.sec.gov. A definitive proxy
statement will be mailed to Trident stockholders as of a record
date to be established for voting on the proposed business
combination. Investors and security holders of Trident are urged to
read the Registration Statement and Proxy Statement and the other
relevant materials when they become available before making any
voting decision with respect to the proposed business combination
because they will contain important information about the business
combination and the parties to the business combination. The
information contained on, or that may be accessed through, the
websites referenced in this press release is not incorporated by
reference into, and is not a part of, this press release.
Participants in the
SolicitationTrident and its directors and officers may be
deemed participants in the solicitation of proxies of Trident's
stockholders in connection with the proposed business combination.
Lottery.com and its officers and directors may also be deemed
participants in such solicitation. Security holders may obtain more
detailed information regarding the names, affiliations and
interests of certain of Trident's executive officers and directors
in the solicitation by reading Trident's Annual Report on Form 10-K
for the fiscal year ended December 31, 2019, and the Registration
Statement and other relevant materials filed with the SEC in
connection with the business combination when they become
available. Information concerning the interests of Trident's
participants in the solicitation, which may, in some cases, be
different than those of their stockholders generally, will be set
forth in the proxy statement relating to the business combination
when it becomes available.
No Offer or SolicitationThis
communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act.
Investor Relations
Contact:Gateway Investor RelationsCody Slach(949)
574-3860TDAC@gatewayir.com
Trident Contact:Vadim
KomissarovCEO(646) 229-7549vkomissarov@tridentacquisitions.com
Lottery.com Contact:Cody
Billingsley(520) 250-3369cody@lottery.com
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