GameSquare Esports to Provide Growth Capital to Acquisition Target Through US$250,000 Loan Agreement Prior to the Closing of the Previously Announced $7.0 Million Financing
TORONTO, March 01, 2021 (GLOBE NEWSWIRE) — GameSquare Esports Inc. (CSE: GSQ; OTC: GMSQF; FRA: 29Q1) (“GameSquare”, “GameSquare Esports”, or the “Company”), an international esports company, announces today that it has entered into a loan agreement with Reciprocity Corp. (“Reciprocity”) dated February 26, 2021, pursuant to which the Company expects to extend a US$250,000 loan (the “Loan”) to Reciprocity. The Loan is unsecured, bears interest at 8% per annum and must be repaid within one year. The proceeds are to be used by Reciprocity to accelerate organic profitable growth by hiring key personnel within the Gaming Community Network (“GCN”) to assist the company in achieving its earnout goals set out in the arrangement agreement in respect of the Transaction (defined below), pursuant to which GameSquare is expected to acquire all of the issued and outstanding equity of Reciprocity (the “Transaction”). The Loan remains subject to the approval of the Canadian Securities Exchange (“CSE”).
“The team at Reciprocity have a robust and growing sales pipeline at GCN which requires key personnel to strike while the iron is hot,” said Justin Kenna, CEO of GameSquare Esports. “By funding Reciprocity early, we are enabling GCN to hit the ground running and start converting potential sales into revenue and EBITDA prior to the acquisition closing, which is expected in the coming days. GameSquare is well capitalized and looking to accelerate organic growth within its portfolio company and continues to assess potential M&A to enhance shareholder value.”Please see the Company’s press releases dated January 4, 2021, January 12, 2021 and February 23, 2021 for more information about the Transaction and the Company’s press releases dated February 8, 2021 and February 9, 2021 for more information about the $7 million bought deal private placement (the “Financing”), each of which are available under the Company’s profiles at www.sedar.com and www.theCSE.com. The Financing and the Transaction are expected to close in early and mid-March 2021, respectively.About GameSquareGameSquare is an international esports company headquartered in Toronto, Canada. The Company is seeking to acquire additional assets and entities serving the esports market and, more broadly, in sports and entertainment. GameSquare’s acquisition of Code Red Esports Ltd. (“Code Red”), an esports talent agency, provided an initial foothold in Europe through its UK operations. Code Red represents leading on-screen talent, players and influencers and works with leading global brands to develop influencer campaigns and esports marketing strategies.For further information, please contact Kevin Wright, President of GameSquare:Email: firstname.lastname@example.org
Phone: (416) 861-2267Forward-Looking InformationThis news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements“) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, to: the Company’s ability to obtain CSE approval for and to extend the Loan to Reciprocity, the expected timing of completion of the Financing and Transaction, the use of proceeds of the Loan by Reciprocity, the business and operations of the Company, and the Company’s ability to execute its business plans. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties. 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 the forward-looking statements and information contained in this news release. Except as required by law, GameSquare assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.Neither the CSE nor its Market Regulator (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.