Esports Entertainment Group Announces Registered Direct Offering and Settlement Agreement

St. Julians, Malta–(Newsfile Corp. – August 15, 2023) – Esports Entertainment Group, Inc. (NASDAQ: GMBL) (NASDAQ: GMBLP) (NASDAQ: GMBLW) (NASDAQ: GMBLZ) (or the “Company”) today announced that it has entered into a securities purchase agreement with an institutional investor (“Investor”) for the purchase and sale of 1,000,000 shares of the Company’s common stock and pre-funded warrants to purchase 4,167,959 shares of common stock in a registered direct offering at an effective purchase price of $0.1935 per share or per pre-funded warrant. The offering is scheduled to close by August 16, 2023, subject to customary closing conditions.

The Company also entered into a settlement agreement (“Settlement Agreement”) with the holder of its Series C Convertible Preferred Stock and Series D Convertible Preferred Stock (“Holder”) to issue common stock in partial settlement of Registration Rights Fees (“RRA Fees”) payable by the Company in connection with a delay in the filing of a registration statement for the purpose of registering the resale of the common stock issuable under the Holder’s Series D Convertible Preferred Stock and common warrants, despite the Company’s best efforts to avoid such delay. The Company agreed to initially issue 10,000 shares at $0.10 per share (“Initial Settlement Price Per Share”) in partial settlement of RRA Fees. The Company further agreed to settle an additional $1,000 (or such other amount as the parties shall mutually agree) on each seven (7) day anniversary of the initial settlement (or another date mutually agreed between the parties), to satisfy up to the remaining balance of the RRA Fees at a price per share equal to the lower of (1) 90% of the lowest volume weighted average price (“VWAP”) per share of the common stock during the ten (10) consecutive trading day period ending and including the trading day immediately preceding the additional share settlement, and (2) the Initial Settlement Price Per Share. As part of the settlement, the Holder also agreed to waive, in part, applicable antidilution provisions within the Series C Convertible Preferred Stock and Series D Convertible Preferred Stock that would allow for the Holder to adjust the conversion price of each preferred stock security based on share issuances under the Settlement Agreement. As a condition for the waiver, the Holder and the Company agreed to effectively establish a new conversion price at the higher of the current conversion price in effect (as may be adjusted) and 90% of the lowest VWAP of the common stock during the ten (10) consecutive trading day period including the applicable conversion date.

The Offering and Settlement Agreement demonstrate the Company’s continued efforts in raising capital and reducing fees, while also providing for a reduction in the amount of the Series C Convertible Preferred Stock and additional amounts otherwise payable to the Holder that can be triggered under the terms of the preferred stock. Alex Igelman, Chief Executive Officer, said, “We appreciate the ongoing support of this institutional investor, which provides us with additional working capital as we continue to execute on our turnaround and growth strategy to establish ourselves as a leader within the iGaming and esports markets. Since the beginning of the year, we have dramatically enhanced our balance sheet, and have built a highly capital efficient business model. Overall, I could not be more encouraged by the outlook for the business and we look forward to announcing several upcoming milestones that have the potential to be transformative for the Company.”

Total gross proceeds from the offering, before deducting the offering expenses are expected to be approximately $1,000,000. The pre-funded warrants are exercisable immediately upon issuance. The Company is completing the Offering without a placement agent and no placement agent fees will be payable.

The shares of common stock and pre-funded warrants sold by us in the Offering have been registered pursuant to a registration statement on Form S-3 (File No. 333-252370), which the Securities and Exchange Commission (the “Commission”) declared effective on February 5, 2021. A final prospectus supplement and accompanying base prospectus relating to the Offering will be filed with the Commission and available at www.sec.gov promptly. Additional information regarding the securities described above and the terms of the offerings will be included in a Current Report on Form 8-K to be filed with the Commission promptly.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

About Esports Entertainment Group

Esports Entertainment Group is a leading, global MGA-licensed, “esports-first” iGaming B2C operator and a US-focused B2B aggregator and supplier of esports solutions and e-simulator content. The Company owns and operates the world’s leading esport venue management system, currently deployed in over 800 global locations, including more than 100 colleges and universities. The Company’s strategy is to capitalize on the multi-billion-dollar market for esports and esports wagering by leveraging its leading position in the industry. The Company is also targeting the rapidly growing market for e-simulator content, which features competitive, short-cycle head-to-head leagues that are optimized for betting. In addition to its plans to distribute esports content, the Company currently provides B2C-focused wagering through its MGA-licensed suite of brands. For additional information about the Company, please visit www.esportsentertainmentgroup.com.

Forward-Looking Statements

The information contained herein includes forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “will be,” “will continue,” “will likely result,” and similar expressions. These statements relate to future events or to our strategies, targeted markets, and future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements, including, the ability to complete the transactions contemplated by the Offering and Settlement Agreement on satisfactory terms or at all, and continued equity conversions under the Company’s preferred stock outstanding, including the conversion prices, timing and other terms of such conversions. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, and those discussed in other documents we file with the SEC, including our ability to maintain compliance with Nasdaq Listing Rules and stay listed on Nasdaq, our obligations under our preferred stock outstanding, and our ability to continue as a going concern. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, unless required by law. The safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 protects companies from liability for their forward-looking statements if they comply with the requirements of such Act.

Investor Relations Inquiries

ir@esportsentertainmentgroup.com

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