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 the holder of its Senior Convertible Note ("Holder") for the purchase and sale of 7,065,000 shares of the Company's common stock and pre-funded warrants to purchase 17,850,000 shares of common stock in a registered direct offering at an effective purchase price of $0.0937 per share or per pre-funded warrant. Upon completion of the offering, the Holder will own approximately 9.9% of the outstanding common stock of the Company.

Jan Jones Blackhurst, Chair of the Company's Board of Directors, said, "We are pleased to be working with a very important stakeholder to raise capital and build our business. We remain excited about the future and the possibilities ahead, and also look forward to naming a CEO in the very near term that will start our next chapter."

Total gross proceeds from the offering, before deducting the offering expenses, was approximately $2.3 million. The pre-funded warrants are exercisable immediately upon issuance.

In a concurrent private placement, the Company is also issuing 100 shares of series B mirroring preferred stock ("Series B Preferred Stock"). At the next annual meeting of stockholders, the Company will call for the approval of, among other things, a proposal to effect a reverse stock split ("Reverse Stock Split Proposal") of the Company's common stock without a corresponding reduction in the authorized shares of common stock. The Series B Preferred Stock has voting rights on the Reverse Stock Split Proposal equal to 25,000,000 votes per share of Series B Preferred Stock, provided that any votes cast by the Series B Preferred Stock with respect to the Reverse Stock Split Proposal must be counted by the Company in the same proportion as the shares of common stock voted on this proposal. Each share of Series B Preferred Stock has a par value of $0.001 per share and a stated value of $1,000 and will be automatically redeemed by the Company upon stockholder approval of a reverse stock split of the Company's shares of common stock.

The offerings closed on December 21, 2022. Pursuant to the Company's plans to increase liquidity and maintain compliance with the Nasdaq Listing Rules, the Company anticipates raising additional funds in the near term either through a private placement or public offering of common stock.