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ESE Announces the Sale of Minority Interest in GameAddik

Monday, 15 July 2024 06:30 AM

ESE Entertainment Inc.

VANCOUVER, BC / ACCESSWIRE / July 15, 2024 / ESE Entertainment Inc. (TSXV:ESE)(OTCQX:ENTEF) ("ESE" or the "Company"), a gaming and esports company that provides a range of services to leading video game developers and publishers, announces that it has entered into a definitive share purchase agreement dated July 14, 2024 (the "SPA") with BPV Games Limited Partnership, an affiliate of BlackPines Capital Partners Ltd., (the "Purchaser") for the sale of its remaining 30% interest (the "Minority Interest") in 9327-7358 Quebec Inc. dba GameAddik ("GameAddik"). GameAddik is an advertising technology company that provides tech-driven marketing solutions for the gaming industry.

The Company sold 70% of its interest in GameAddik on August 14, 2023 to the Purchaser, subject to a 15% holdback (the "Holdback") to be released in two equal tranches on each of the 6-month and 12-month anniversaries of closing (the "Initial Disposition"), the first tranche of which was received on February 14, 2024.

Pursuant to the terms of the SPA, the Company has agreed to sell its remaining 30% interest in GameAddik to the Purchaser (the "Transaction") for consideration of $4,030,925, payable in cash on closing. The Purchaser will also pay the Company the second tranche of the Holdback from the Initial Disposition, being $548,159 on August 14, 2024. No finder's fee will be payable in connection with the Transaction.

The proceeds from the Transaction will allow the Company to improve its cash position without causing dilution to its shareholders, to settle certain liabilities, to invest in the further development of its core business operations, and to explore other strategic opportunities to provide shareholder value in the near-term and long term. The Transaction remains subject to the satisfaction of customary closing conditions, including applicable regulatory approvals, including the acceptance of the TSX Venture Exchange (the "Exchange"), and the receipt of the Shareholder Consent (defined below).

The Transaction constitutes an arm's length transaction within the meaning of the policies of the and constitutes a "Reviewable Disposition" in accordance with Exchange Policy 5.3 - Acquisitions and Dispositions of Non-Cash Assets. Exchange Policy 5.3 also requires ESE to obtain disinterested shareholder approval for the Transaction, which the Company intends to seek by way of written consent of disinterested shareholders holding more than 50% of the issued and outstanding shares of the Company (the "Shareholder Consent"), excluding shares held by the Purchaser, its Associates, Affiliates, and any Non-Arm's Length parties to the Purchaser. The Company's management and Board of Directors, holding approximately 24% of the outstanding shares of the Company, have unanimously approved the Transaction and are expected to execute written consents in favor of the Transaction. If the SPA is terminated as a result of the Company being unable to obtain the Shareholder Consent, the Company will be required to pay a break fee of $100,000 to the Purchaser.

ESE Entertainment Inc.

Konrad Wasiela
Chief Executive Officer and Director
+1 (437) 826-4012

About ESE Entertainment Inc.

ESE is a global technology company focused on gaming and esports. The Company provides a range of services to leading video game developers, publishers, and brands by providing technology, infrastructure, and fan engagement services internationally. ESE also operates its own ecommerce channels, esports teams, and gaming leagues. www.esegaming.com

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

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 ESE anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Such information may involve, but is not limited to, statements with respect to: the Transaction and the completion thereof; the satisfaction of conditions of closing the Transaction, including obtaining Exchange approval and the Shareholder Consent; and the benefits of the Transaction for ESE, including that it will allow the Company to improve its cash position without causing dilution to its shareholders, to settle certain liabilities, to invest in the further development of its core business operations, and to explore other strategic opportunities. 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 information is based on currently available competitive, financial, and economic data and operating plans, strategies or beliefs as of the date of this news release, but involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of ESE to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information, including that the Transaction may not be completed or that ESE may not realize the expected benefits of the Transaction. Such factors may be based on information currently available to ESE, including information obtained from third-party industry analysts and other third-party sources, and are based on management's current expectations or beliefs regarding future growth, results of operations, future capital (including the amount, nature and sources of funding thereof) and expenditures. Any and all forward-looking information contained in this press release is expressly qualified by this cautionary statement. Trading in the securities of ESE should be considered highly speculative.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information about ESE, please contact:

[email protected]

SOURCE: ESE Entertainment Inc.

Topic:
Company Update
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