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Real Luck Group Announces Closing of Upsized [and Oversubscribed] $17.8 Million Private Placement of Special Warrants Led by Gravitas Securities

·9 min read

/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./

CALGARY, AB and ISLE OF MAN, March 9, 2021 /CNW/ - Real Luck Group Ltd. (TSXV: LUCK) (the "Company" or "Luckbox") is pleased to announce that it has completed its previously announced upsized [and oversubscribed] private placement of special warrants of the Company ("Special Warrants") for aggregate gross proceeds of approximately $17.8M (the "Offering"). The Offering consisted of a brokered portion (the "Brokered Private Placement") and a non-brokered portion (the "Non-Brokered Private Placement") for aggregate gross proceeds of $16,980,080.40 and $824,700, respectively. Pursuant to the Offering, a total of 14,837,317 Special Warrants, including an aggregate of 1,650,067 Special Warrants issued as a result of the exercise of the agent's over-allotment option, were sold at a price per Special Warrant of $1.20 (the "Offering Price").

The Brokered Private Placement was conducted by Gravitas Securities Inc., as lead agent and sole bookrunner ("Gravitas" or the "Agent").

Each Special Warrant entitles the holder thereof to receive one unit of the Company (a "Unit"), without payment of additional consideration, with each Unit being comprised of one common share of the Company (a "Share") and one-half of one common share purchase warrant of the Company (each whole such warrant, a "Warrant"). Each Warrant will entitle the holder thereof to purchase an additional common share of the Company at a price of $1.50 per share (the "Warrant Exercise Price") for a period of 36 months from the initial closing date of the Offering (the "Initial Closing Date").

The Special Warrants and the Warrants were created and issued pursuant to, and are governed by, the terms of a special warrant indenture and a warrant indenture respectively between the Company and TSX Trust Company, as indenture trustee, in each case.

"Luckbox's strong leadership team paired with the current size and growth potential of esports and sports betting led to the Offering being heavily oversubscribed, as investors begin to recognize this attractive sector and opportunity", Company Chairman Drew Green said.

"We are grateful to our investors for their support and this financing puts Luckbox in a strong position to execute on our goals as we strive to further establish the business as a global leader in the esports betting space."

The Company has agreed to prepare and file a short form prospectus (the "Prospectus") qualifying the distribution of the Shares and the Warrants (including those issued to Gravitas in connection with the Offering) in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. In the event a receipt for the preliminary Prospectus has not been issued within 60 days of the Closing Date or a receipt for the final Prospectus has not been issued within 90 days of the Closing Date, each Special Warrant will, upon the earlier of (i) four months and one day following the Closing Date and (ii) the date of the issuance of the receipt for the final Prospectus, entitle the holder of the Special Warrant to receive, at no additional cost, an additional one-half of one non-transferable share purchase warrant at the same terms as the Warrants (the "Penalty Warrants"), and 1.10 Units (inclusive of the Penalty Warrants) per Special Warrant, provided that the Company shall not be required to issue fractional Units, Shares or Warrants and any fractions shall be rounded down to the nearest whole number.

Until a receipt is issued for the final Prospectus, securities issued in connection with the Offering will be subject to a 4-month hold period from the date of issue.

The net proceeds of the Offering are expected to be used for working capital and general corporate purposes.

As consideration for its services in connection with the Brokered Private Placement, the Company paid to the Agent a cash commission equal to $1,358,406.43 and issued to the Agent a total of 1,132,005 non-transferable agent special warrants (the "Agent Special Warrants"). Each Agent Special Warrant is exercisable for one non-transferable warrant (the "Agent Warrants") at no additional cost. Each Agent Warrant entitles the holder to purchase one unit of the Company (each, an "Agent Unit") on the same terms and conditions as the Units, at a price per unit equal to the Offering Price for a period of 36 months from the date of issuance thereof, with each Agent Unit being comprised of one (1) Share and one half (1/2) of one non-transferable Share purchase warrant (each whole warrant, an "Agent Unit Warrant"). Each Agent Unit Warrant shall be exercisable into one Share at the Warrant Exercise Price for a period of 36 months from the date of issuance thereof.

Gravitas also provided fiscal advisory services pursuant to the terms of a fiscal advisory agreement (the "Fiscal Advisory Agreement") with respect to the Non-Brokered Private Placement. Pursuant to the Fiscal Advisory Agreement, the Company paid Gravitas a fiscal advisory fee equal to $65,976 and issued to the Gravitas a total 54,980 advisor special warrants (the "Advisor Special Warrants"). Each Advisor Special Warrant is exercisable for one non-transferable warrant (the "Advisor Warrants") at no additional cost Each Advisor Warrant entitles the holder to purchase one unit of the Company (each, an "Advisor Unit") on the same terms and conditions as the Units, at a price per unit equal to the Offering Price for a period of 36 months from the date of issuance thereof, with each Advisor Unit being comprised of one (1) Share and one half (1/2) of one non-transferable Share purchase warrant (each whole warrant, an "Advisor Unit Warrant"). Each Advisor Unit Warrant shall be exercisable into one Share at the Warrant Exercise Price for a period of 36 months from the date of issuance thereof.

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

About Luckbox

The Company is an award-winning betting company that offers legal, real-money betting, live streams, and statistics on all major esports and sports on desktop and mobile devices. The Company has a Business-to-Consumer (B2C) platform, and by leveraging shared technology, data, and resources, the Company can offer an extensive range of betting options for esports tournaments. The Company's in-house customized user interface and user experience, built on a technology stack that supports multiple odds and streaming sources, allows the Company to deliver deep esports betting coverage. The Company has been built by a team combining experience in the igaming industry and a passion for esports to offer players a unique, broad, engaging, and legal CS:GO betting, Dota 2 and League of Legends betting experience. The Company serves esports fans in more than 80 territories across the globe. In November 2020, Luckbox was named Rising Star at the EGR Operator Awards. The Company (via the Group) holds a full licence under the Online Gambling Regulation Act (OGRA), issued by the Isle of Man Gaming Supervision Commission. As the Group is fully licensed in the Isle of Man for B2C and Business to Business (B2B) esports & sports betting and casino, the Company has access to favourable payment processors. Luckbox is committed to supporting responsible gambling.

Follow Luckbox on Twitter / Facebook / LinkedIn

CAUTION WITH RESPECT TO FORWARD-LOOKING STATEMENTS

The TSX Venture Exchange has neither approved nor disapproved the contents of this press release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Note Regarding Forward-Looking Statements: This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws or forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements in this news release, other than statements of historical facts, including statements regarding future estimates, plans, objectives, timing, assumptions or expectations of future performance, including information concerning the Offering, the anticipated use of proceeds of the Offering, timing for the filing of the preliminary and final Prospectus and obtaining receipts for each, are forward-looking statements and contain forward-looking information. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as "intends" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would" or "occur".

Forward-looking statements are based on certain material assumptions and analysis made by the Company and the opinions and estimates of management as of the date of this press release, including that regulatory approval of the preliminary and final Prospectus will be obtained in a timely. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Important factors that may cause actual results to vary, include, without limitation, risks that the Company will not obtain the requisite approvals to file the final Prospectus to qualify the securities issuable on conversion of the Special Warrants, Agent Special Warrants and Advisor Special Warrants, adverse market conditions, risks inherent in the Company's business in general, that the proceeds of the Offering may need to be used for purposes other than as set out in this news release and other factors beyond the control of the Company.

Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. 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 forward-looking statements and forward-looking information. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statement, forward-looking information or financial out-look that are incorporated by reference herein, except in accordance with applicable securities laws.

SOURCE Real Luck Group Ltd.

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