TORONTO, Jan. 26, 2021 /CNW/ -- Engine Media Holdings, Inc. (TSXV: GAME; OTCQB: MLLLF) ("Engine Media" or the "Company") announces that is has closed the final tranche of 966,296 units (the "Units") for gross proceeds of US$7,247,222.50 of the previously announced non-brokered private placement of units (the "Units") at a price of US$7.50 per Unit (the "Offering"). Together with the first tranche closing, the Company issued a total of 2,371,747 Units for gross proceeds of US$17,788,105. Each Unit consists of one common share of the Company and one-half of one common share purchase warrant (a "Warrant"). Each whole Warrant entitles the holder to acquire one additional share of the Company at a price of US$15.00 per share for a period of 3 years provided that: (i) if the common shares are listed for trading on NASDAQ, (ii) the Company completes an offering of securities under a short form prospectus for an aggregate amount of at least US$30,000,000, and (iii) the closing price of the common shares on NASDAQ is US$30.00 or greater for a period of 15 consecutive trading days, then the Company may accelerate the expiry date of the Warrants to the 30th day after the date written notice is provided to the holders.
The proceeds of the Offering will be allocated to marketing and advertising of the Company's product offerings, product development initiatives for UMG, WinView and Stream Hatchet, and general working capital purposes.
As part of the final tranche closing of the Offering, the Company paid cash commissions to eligible finders under the Offering totaling $205,652.05 and also issued the following securities as partial payment of commissions to finders: 12,752 Units; and, 40,040 finders warrants, with each finder warrant exercisable into a common share at an exercise price of US$15.00 per share for 3 years subject to the same acceleration terms described above.
All securities issued under the Offering are subject to a hold period of four months and one day from the closing.
EB Acquisition Credit Facility
Under the terms of the US$5 million secured credit facility (the "EB Loan") with arm's length lender EB Acquisition Company, LLC ("EB LLC"), the EB Loan is to be repaid upon the Company completing an equity financing of at least US$15 million, which is the case with respect to the Offering.
The Company and EB LLC have agreed that in lieu of repayment of the EB Loan, the US$5 million principal amount will now be subject to a secured convertible debenture (the "Convertible Debenture") which is convertible into units of the Company at a conversion price of US$10.25 per unit, with each unit comprised of one common share and one-half of a warrant, with each whole warrant exercisable into a common share at an exercise price of US$15.00 per share for a period of three years from the issuance of the Convertible Debenture. The issuance of the Convertible Debenture is subject to the approval of the TSX Venture Exchange.
This press release does not constitute an offer of sale of any of the foregoing securities in the United States. None of the foregoing securities have been and will not be registered under the U.S. Securities Act of 1933, as amended (the "1933 Act") or any applicable state securities laws and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the 1933 Act) or persons in the United States absent registration or an applicable exemption from such registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of the foregoing securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
This news release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these Securities in any jurisdiction in which an offer, solicitation or sale would be unlawful prior to registration or qualifications under the securities laws of any such jurisdiction.
About Engine Media Holdings, Inc.
Engine Media is focused on accelerating new, live, immersive esports and interactive gaming experiences for consumers through its partnerships with traditional and emerging media companies. The company was formed through the combination of Torque Esports Corp., Frankly Inc., and WinView, Inc. and trades publicly under the ticker symbol (TSX-V: GAME) (OTCQB: MLLLF). Engine Media will generate revenue through a combination of: direct-to-consumer and subscription fees; streaming technology and data SaaS-based offerings; programmatic advertising and sponsorships; as well as intellectual property licensing fees. To date, the combined companies clients have included more than 1,200 television, print and radio brands including CNN, ESPN, Discovery / Eurosport, Fox, Vice, Newsweek and Cumulus; dozens of gaming and technology companies including EA, Activision, Blizzard, Take2Interactive, Microsoft, Google, Twitch and Ubisoft; and have connectivity into hundreds of millions of homes around the world through their content, distribution and technology.