Elephant Hill and Luckbox Announces Completion of Second Tranche of Oversubscribed Subscription Receipts Offering

Not for distribution to U.S. newswire services or dissemination in the United States

CALGARY, AB/ ACCESSWIRE / June 22, 2020 / Further to the press release dated June 10, 2020, Esports Limited ("Luckbox" or the "Company") and Elephant Hill Capital Inc. (TSXV:EH.P) ("Elephant Hill") are pleased to announce that Luckbox has completed the second tranche of its private placement offering of subscription receipts ("Subscription Receipts") led by Gravitas Securities Inc. and Beacon Securities Ltd. (the "Co-Lead Agents") as co-lead agent and co-bookrunners, on behalf of a syndicate of agents (collectively with the Co-Lead Agents, the "Agents") for additional gross proceeds of $502,220 (the "Brokered Financing"). Concurrently with the Brokered Financing, Luckbox completed a second tranche non-brokered offering of Subscription Receipts for additional gross proceeds of $125,430 (the "Non-Brokered Financing" and together with the Brokered Financing, the "Offering") resulting in the aggregate gross proceeds of the second tranche of the Offering being $627,650, bringing the total raised in the offering to date to $4,505,874. The Offering was completed in connection with the proposed business combination (the "Proposed Transaction") between Luckbox and Elephant Hill previously announced in a press release of Elephant Hill dated May 13, 2020, which transaction is intended to constitute Elephant Hill's "Qualifying Transaction" pursuant to Policy 2.4 of the TSX Venture Exchange (the "Exchange"). The Offering was heavily oversubscribed and subsequently upsized from the previously announced range of $2,000,000 to $3,000,000.

The Offering

Under the terms of the Brokered Financing between Luckbox and the Agent, Luckbox has to date issued 1,195,761 Subscription Receipts at a price of $0.42 per Subscription Receipt (the "Offering Price") for aggregate gross proceeds of $502,220. Concurrently, Luckbox has completed the Non-Brokered Financing of Subscription Receipts on the same terms as the Brokered Financing by issuing 298,607 Subscription Receipts at the Offering Price for aggregate gross proceeds of $125,430.

The proceeds of the Brokered Financing, together with funds raised in the Non-Brokered Financing, will be used for general corporate and working capital purposes.. The Offering is a condition precedent to the Proposed Transaction.

Each Subscription Receipt entitles the holder thereof to receive, upon satisfaction of the Escrow Release Conditions (as hereinafter defined) on or before the Escrow Release Deadline (as hereinafter defined), and without payment of additional consideration, one unit of Luckbox (each, a "Unit"). Each Unit will consist of one common share (each, an "Underlying Share") and one-half of one common share purchase warrant of Luckbox (each whole common share purchase warrant, an "Underlying Warrant"), with each Underlying Warrant being exercisable into one common share in the capital of Luckbox at a price of $0.63 for a period of 24 months from the date of the satisfaction of the Escrow Release Conditions (as hereinafter defined). Pursuant to the Proposed Transaction, each Underlying Share and Underlying Warrant will be exchanged on an equivalent basis, without further consideration, for common shares and warrants in the capital of Elephant Hill.

The gross proceeds of the Offering, less (i) 50% of the Agents' Fee (as defined below), which was paid to the Agents, and (ii) the expenses of the Agents incurred in connection with the Brokered Financing, which were paid to the Agents (collectively, the "Escrowed Proceeds") were delivered to and held by Computershare Trust Company (the "Escrow Agent"). The Escrowed Proceeds, together with all interest and other income earned thereon, are referred to herein as the "Escrowed Funds".

The remaining 50% of the Agents' Fee will be released from escrow to the Agents from the Escrowed Funds and the balance of the Escrowed Funds will be release from escrow to the Company upon satisfaction of customary escrow release conditions (the "Escrow Release Conditions") on or before 5:00 pm (Calgary time) on December 31, 2020 (the "Escrow Release Deadline").

In the event that (i) the Escrow Release Conditions are not satisfied on or before the Escrow Release Deadline, or (ii) if prior to such time, the Company advises the Agents or announces to the public that it does not intend to satisfy the Escrow Release Conditions, the Escrow Agent will return to holders of Subscription Receipts an amount equal to the aggregate Offering Price of the Subscription Receipts held by them and their pro rata portion of any interest earned thereon. The Company will be responsible and liable to the holders of Subscription Receipts for any shortfall between the aggregate Offering Price and the Escrowed Funds.

The Agents will receive a cash commission equal to 8.0% of the aggregate gross proceeds from the Brokered Financing (the "Agents' Fee"). Luckbox will also issue to the Agents that number of compensation options (the "Compensation Options") equal to 8.0% of the aggregate number of Subscription Receipts sold pursuant to the Brokered Financing. Each Compensation Option will entitle the holder thereof to acquire one Unit of the resulting issuer (the "Resulting issuer") at an exercise price of $0.42 for a period of 24 months following the date the Resulting Issuer common shares are listed on the Exchange.

Qualifying Transaction Update

Concurrently with the completion of the Offering, Elephant Hill continues to move expeditiously towards the closing of the Qualifying Transaction with Luckbox, as detailed in its press release dated May 12, 2020.

Mo Fazil, President and CEO for Elephant Hill commented, "As evidenced by the oversubscribed subscription receipts offering, we continue to be enthusiastic about our proposed business combination with Luckbox. The esports market continues to expand with each passing month and Luckbox is positioned to be one of the leading e-sports betting companies in an exciting growth industry."

About Luckbox

Luckbox is a private esports betting company, incorporated in the Isle of Man on April 25, 2019, and headquartered in the Isle of Man, with a fully licensed betting platform dedicated to serving the global esports community where fans and customers are able to bet, watch, and chat in a safe environment. Luckbox believes that it serves the single largest revenue category in esports today and derives its revenue from one of the most promising verticals in the esports industry. Luckbox has an experienced management team in both esports and betting and a dedicated esports user experience.

Esports Insider says: "Luckbox is one of the bookmakers at the forefront of esports at the moment, holding a full gambling licence and accepting bets from customers in over 100 territories. If the public listing goes ahead, all eyes will be on Luckbox when it comes to esports betting."

https://esportsinsider.com/2020/05/luckbox-tsx-venture-exchange/

Investors are cautioned that, except as disclosed in the disclosure document to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon.

For further information, please contact:

Elephant Hill Capital Inc.
Mohammad Fazil, President, Chief Executive Officer, Director
Email: mofazil@gmail.com
Phone: (403) 613-7310

Esports Ltd.
Quentin Martin, Chief Executive Officer
Email: quentin@luckbox.com
Phone: (+44) 7498 181 863

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.

All information contained in this press release with respect to Elephant Hill and Luckbox was supplied by the parties, respectively, for inclusion herein, and Elephant Hill and its directors and officers have relied on Luckbox for any information concerning such party.

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable, pursuant to the requirements of the TSXV, majority of the minority shareholder approval. Where applicable, the Proposed Transaction cannot close until the required shareholder and regulatory approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of the Corporation should be considered highly speculative.

This press release is not an offer of securities for sale in the United States. The securities described in this press release have not been registered under the U.S. Securities Act of 1933, as amended, 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 U.S. Securities Act of 1933, as amended) absent registration or an exemption from registration. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction where such offer, solicitation, or sale would be unlawful.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

Cautionary Note Regarding Forward-Looking Statements: This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements in this news release, other than statements of historical facts, including statements regarding future estimates, plans, objectives, timing, assumptions or expectations of future performance, including the terms and conditions of the Proposed Transaction; the terms and conditions of the Proposed Financing; and future developments and the business and operations of the "Resulting Issuer" after the Proposed Transactionare forward-looking statements and contain forward-looking information. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as "intends" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would" or "occur". Forward-looking statements are based on certain material assumptions and analysis made by the Company and the opinions and estimates of management as of the date of this press release, including that the terms and conditions of the Proposed Transaction will be as anticipated by management; the terms and conditions of the proposed Financing will be as anticipated by management; and future developments and the business and operations of the "Resulting Issuer" after the Proposed Transaction will be as anticipated by management. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Important factors that may cause actual results to vary, include, without limitation, that the terms and conditions of the Proposed Transaction will not be as anticipated by management or will not close at all; the terms and conditions of the Proposed Financing will not be as anticipated by management or will not close at all; and future developments and the business and operations of the "Resulting Issuer" after the Proposed Transaction will not be as anticipated by management. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statement, forward-looking information or financial out-look that are incorporated by reference herein, except in accordance with applicable securities laws.

SOURCE: Elephant Hill Capital Inc.