ESE (OTC: ENTEF) Announces Closing of $8.6 Million Bought Deal Public Offering

VANCOUVER, British Columbia, July 19, 2021 — ESE Entertainment Inc. (TSX-V: ESE) (OTCQB: ENTEF) (“ESE” or the “Company“) is pleased to announce that it has closed its previously announced bought deal public offering for gross proceeds of $8,629,600, which includes the full exercise of the Over-Allotment Option (the “Offering”). Under the Offering, the Company sold 6,164,000 units of the Company (the “Units”) at a price of $1.40 per Unit (the “Issue Price”). Canaccord Genuity Corp. acted as sole bookrunner and lead underwriter (the “Lead Underwriter“) on behalf of a syndicate of underwriters comprised of Roth Canada, ULC, Stifel Nicolaus Canada Inc., and PI Financial Corp. (together with the Lead Underwriter, the “Underwriters“).

Pursuant to an underwriting agreement among the Company and the Underwriters, the Underwriters agreed to purchase, on a “bought deal” basis, an aggregate of 5,360,000 Units at the Issue Price, for gross proceeds of $7,504,000 to the Company. The Company granted the Underwriters an option (the “Over-Allotment Option“) to purchase up to an additional 804,000 Units at the Issue Price, to cover over-allotments, if any, and for market stabilization purposes. The Underwriters exercised the Over-Allotment Option in full, resulting in additional gross proceeds of $1,125,600 to the Company.

Each Unit consists of one common share of the Company (each, a “Common Share“) and one Common Share purchase warrant (a “Warrant“). Each Warrant is exercisable to acquire one Common Share at a price of $1.95 at any time before July 19, 2023. The expiry date of the Warrants may be accelerated by the Company if the volume weighted average price of the Common Shares on the TSX Venture Exchange is greater than $2.925 for the preceding ten (10) consecutive trading days, at which time the Company may accelerate the expiry date of the Warrants to a date that is at least thirty (30) trading days following the date of such written notice.

The Units were offered by way of a short form prospectus filed in every province of Canada, other than Quebec. The net proceeds of the Offering will be used for business development, general working capital, and other general corporate purposes.

In connection with the Offering, the Company paid the Underwriters a cash commission of $604,072 and issued to the Underwriters an aggregate of 431,480 warrants of the Company (the “Underwriters’ Warrants“). Each Underwriters’ Warrant is exercisable to acquire one Unit at any time before July 19, 2023. Additionally, the Company issued 154,100 Units to the Lead Underwriter as a corporate finance fee.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the U.S. Securities Act of 1933 (the “U.S. Securities Act“) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.