Mr. Konrad Wasiela reports

ESE COMPLETES SALE OF 70% INTEREST IN GAMEADDIK IN AN ALL-CASH TRANSACTION, RETAINING A STRATEGIC 30% INTEREST

Further to its news release dated Aug. 9, 2023, ESE Entertainment Inc. has completed the sale of 70 per cent of the issued and outstanding shares of the company's wholly owned subsidiary, 9327-7458 Quebec Inc., doing business as GameAddik, to BPV Games LP, an affiliate of BlackPines Capital Partners Ltd. The remaining 30 per cent of the issued and outstanding shares of GameAddik will be retained by the company.

For further information respecting GameAddik and the terms of the transaction, please see the company's news release dated Aug. 9, 2023.

Konrad Wasiela, chief executive officer of ESE, commented: "We are excited to finalize this strategic transaction with BlackPines and to collaborate with Darren Huston and his team. This step is key in our commitment to maintain a position of strength while minimizing dilution and increasing shareholder value. We are also retaining a 30-per-cent stake in GameAddik, which underscores our belief in its long-term potential in its future success. In addition, we are going to aggressively roll into the next phase of our business growth, which includes focusing on the growth of our core assets. We have a clear plan and are ready to get to work on executing."

Under the terms of the share purchase agreement between ESE and BPV, BPV paid to the company an aggregate purchase price of $9.1-million in cash, subject to customary adjustments, and subject to a 15-per-cent hold-back for certain indemnification obligations of the company under the SPA. The hold-back will be released to the company in two equal tranches on each of the six-month and 12-month anniversaries of the closing, respectively, subject to any outstanding or pending claims for indemnification. As part of the transaction costs in connection with the transaction, ESE paid ZDK Holdings Ltd., doing business as Kepler Acquisition Group, a fee of 2 per cent of the transaction value for providing merger and acquisition advisory services in connection with the transaction.

About ESE Entertainment Inc.

ESE is a global technology company focused on gaming and e-sports. The company provides a range of services to leading video game developers, publishers and brands by providing technology, infrastructure and fan engagement services internationally. ESE also operates its own e-commerce channels, e-sports teams and gaming leagues.

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