Mr. Jason Bailey reports

EAST SIDE GAMES GROUP ANNOUNCES NON-BROKERED PRIVATE PLACEMENT OF UNITS TO RAISE UP TO $3.5 MILLION

East Side Games Group Inc. has arranged a non-brokered private placement of 31,818,182 units at 11 cents per unit for total gross proceeds of up to $3.5-million.

Each unit will comprise one common share and one full whole warrant. Each whole warrant will be exercisable at 14 cents per share for a period of three years from issuance. The warrants will be subject to standard anti-dilution adjustments.

The private placement will be offered in reliance on prospectus exemptions, and any securities sold will be subject to a four-month statutory hold period. The private placement is not anticipated to have any material impact on the control of the company, nor is it anticipated that any new control persons would be created as a result of the private placement.

It is anticipated that Derek Lew, a director of the company, will participate in the private placement for an amount of $1-million for 9,090,909 units. As at the date of this news release, Mr. Lew holds 1,667,244 common shares of the company (2.17 per cent). If the private placement is completed as anticipated, Mr. Lew will hold 10,758,153 common shares (representing 9.89 per cent of the common shares anticipated to be outstanding upon completion of the private placement on a partially diluted basis), 9,090,909 warrants and 250,000 incentive stock options. Upon exercise of his warrants, Mr. Lew would own 19,849,062 common shares, representing 16.84 per cent of the then issued and outstanding common shares assuming no other share issuances.

The Toronto Stock Exchange company manual requires shareholder approval be obtained for private placements if the maximum number of common shares issuable under the private placement represents an amount that is more than 25 per cent of the total outstanding common shares as at the date of the press release (pursuant to Section 607(g)). Disinterested shareholder approval must be obtained (excluding those shareholders participating in this private placement and their associates and affiliates) if the number of common shares issued and issuable to insiders under a private placement exceeds 10 per cent of the company's issued and outstanding common shares as of the date hereof (pursuant to Section 607(g)(ii)).

As: (a) the private placement is for up to 31,818,182 units (being equivalent to 41.35 per cent of the company's outstanding shares as at the date of this press release); (b) Mr. Lew's subscription for 9,090,909 units represents an amount that is equivalent to 11.81 per cent of the company's outstanding shares as at the date of this press release; and (c) the warrants comprising the units have an exercise price of 14 cents per share (and the five-day VWAP (volume-weighted average price) is 14.4 cents per share), the company has obtained written consent from Jason Bailey, the company's chief executive officer and a director, in support of the private placement in accordance with Section 604(d) of the TSX company manual. Mr. Bailey holds more than 50 per cent of the company's outstanding shares as at the date of this press release.

The net proceeds from the private placement will be used to repay indebtedness owing to Royal Bank of Canada (RBC) and for operating expenses and general working capital. Mr. Bailey commented: "With this funding in place, we are on solid footing to continue our disciplined approach to completing the business's turnaround. With our core portfolio of well-performing titles, we have a solid foundation to rebuild upon. We feel we have a strong runway, pipeline and team to execute toward a positive 2026. I'd like to thank our existing shareholders for their support and guidance through a difficult 2025 and look forward to achieving the results that will allow this company, our capital markets strategy and employees to reach its potential."

The company's board of directors considers the private placement to be in the best interests of its shareholders, after having taken into account other alternative forms of financing. In the course of its review, the company considered other replacement debt financing, the company's continuing cash flow from operations, as well as continuing operating expenses, one-off necessary expenditures and the company's debt load, within the larger context of the analysis detailed in its press release dated March 31, 2026, as to the reorienting of the company's overall business strategy.

The company anticipates that the private placement will close on or before May 8, 2026, subject to acceptance by the TSX.

The company reserves the right to pay finders' fees in the form of common shares (in lieu of cash fees) and broker warrants to arm's-length finders in connection with the private placement to arm's-length parties, in accordance with TSX policies. No finders' fees will be paid to any non-arm's-length parties nor with respect to subscriptions from non-arm's-length parties. A maximum of 1,363,636 common shares (to be issued at 11 cents per share for a total value of $150,000) and a maximum of 1,254,545 broker warrants will be issuable, assuming the private placement is fully subscribed. Each broker warrant will entitle the holder to acquire one common share at 14 cents per common share for a period of three years from issuance.

The maximum number of securities issuable under the private placement is 66,254,545 common shares, comprising 31,818,182 common shares comprising the units, 31,818,182 common shares issuable upon exercise of the warrants, 1,363,636 common shares to be issued as finders' fees and 1,254,545 common shares issuable upon exercise of the broker warrants, which represent an amount equivalent to 86.10 per cent of the total outstanding common shares as at the date of this press release on a non-diluted basis, without taking into effect the private placement itself, or approximately 46.27 per cent of the company's total issued and outstanding common shares following completion of the private placement (being 143,200,825 shares anticipated to be outstanding on a partially diluted basis, assuming the private placement is fully subscribed, full issuance of the finders' fees shares, and full exercise of the Warrants and broker warrants). The unit price represents a 22-per-cent discount to the company's five-day volume-weighted trading price of its common shares on the TSX as at the time of submitting the company's application to TSX. The exercise price and the broker warrant exercise price represent a 2.47-per-cent discount to the market price.

The total number of common shares expected to be issued to an insider (Mr. Lew) under the private placement is 18,181,818 (consisting of 9,090,909 common shares and 9,090,909 common shares issuable upon full exercise of warrants), representing 23.63 per cent of the total outstanding common shares as at the date of this press release on a non-diluted basis, without taking into effect the private placement itself, or 12.70 per cent of the company's total issued and outstanding common shares following completion of the private placement (being 143,200,825 shares anticipated to be outstanding on a partially diluted basis, assuming the private placement is fully subscribed, full issuance of the finders' fees shares, and full exercise of the warrants and the broker warrants).

About East Side Games Group Inc.

East Side Games is a leader in free-to-play mobile gaming, thrilling players with unforgettable experiences that spark lifelong fandom. Fuelled by an entrepreneurial spirit, East Side Games is driven by creativity, flawless execution and a laser-focused strategy. East Side Games develops and publishes both original and licensed IP (intellectual property) titles, license the company's cutting-edge GameKit(s) platforms, and strategically acquire studios or games to expand East Side Games' family.

Headquartered in Vancouver with around 100 talent-dense team members, East Side Games operates over a dozen titles under East Side Games (ESG) and LDRLY (Technologies) Inc. (LDRLY). Together, East Side Games is crafting, launching and publishing mobile games across its own studios and an extended Game Kit partner network -- reaching players on iOS and Android around the world.

East Side Games powers its success through in-app purchases (IAPs) -- offering exclusive, game-enhancing virtual items -- and in-game advertising. To keep growing, East Side Games focuses on captivating audiences, keeping them engaged and unlocking exciting new ways to monetize. East Side Games will drive this momentum by launching bold new titles, enriching its current lineup, innovating discovery, expanding into fresh markets and exploring new distribution platforms.

We seek Safe Harbor.