EEG enters security purchase agreement
The deal is set to garner $4.0m (£3.2m/€3.6m) in net proceeds for EEG after estimated offering expenses.
The agreement also gives EEG the opportunity to procure additional funding, as the investor will be able to receive a warrant to purchase shares of common stock and additional shares of series D convertible preferred stock.
The deal will close in the first week of May, subject to closing conditions.
This comes after EEG entered into a deal with Alto Opportunity Master Fund in April, to exchange its debt with company stock. This transaction was completed on 28 April.
“We appreciate the additional investment in the company, which not only bolsters our cash position but also complements the previously announced exchange of the company’s $15m senior convertible note into unsecured, series C convertible preferred stock,” said Alex Igelman, chief executive of EEG. “As a result of these transactions, we expect to have significantly enhanced our balance sheet.”
Igelman added that EEG is now looking towards growing its presence in its target markets, including esports.
“Moreover, we have eliminated over $4m of annual operating expenses and project that we will have reduced debt and other liabilities by over $42m, year to date. As a result, we are now positioning the company to execute on our new, highly focused and capital efficient business model, targeting the growing igaming, esports and e-simulator markets.”
Also in April, Igelman shared EEG’s plans for divestment and expanding its B2C offerings.