A merger agreement has been concluded on 16 June 2020 by Backstageplay Inc. (BP TSXV: FSE: DOZC) (OTC Rose: PRYNF) (“Company”), eUnited eSports Inc. (“eUnited”) and Backstageplay (“Delaware Inc.), (“SubCo”), in terms of which the Company will acquire eUnited through its merger with Subco, which is a wholly-owned subsidiary of the Company.
The entity resulting from the merger will be called “MergerCo” for purposes of this press release.
The Merger will be classified as an Arm’s Length Transaction (as defined in TSX Venture Exchange (“TSX-V”) Policy 1.1 – Interpretation).
Structure of merger:
The Company will effect a financial restructuring exercise (the “Capital Reorganization”) preceding the merger, with the result that the Company shares will be split into two classes: ordinary shares (“Common shares”) and a distinct set of purely “Voting Shares” entitling the holder to one vote per share, and attaching no rights on distribution of dividends or liquidation of assets. Simultaneously, a restructuring of eUnited capital ( the “eUnited Reorganization) will be effected in terms of which eUnited shareholders’ interest will be owned jointly through a new limited liability company, (“eUnited HoldCo”).
Approval of shareholders:
Prior consent may need to be obtained from shareholders before the commencement of the Capital Reorganization. However, save for any obligations imposed by TSX-V, shareholder approval is not expected to be obtained for the Merger, as it is not classified as a Related Party Transaction (as defined in TSX-V Policy 1.1 – Interpretation), and because no conditions exist which may create a conflict of interest for the Company or any of the parties concerned.
Scott White, Backstageplay’s Chief Executive Officer said: “We are delighted to have reached this business milestone with our partners at eUnited. “We recognize that eSports professionals, teams and the industry as a whole has struggled to provide a forum where effective monetization can occur through gamification. With modest customizations to our technology stack, we can quickly provide the tools for players; teams and the global eSports market to monetize dedicated fan loyalty through social gaming. Combining the access offered by the eUnited organization with our existing platform will give the combined business speed to market allowing us to quickly drive social gaming revenue to players and teams who are searching for ways to reward fan loyalty.
Adam Stein , CEO of eUnited stated: “We are excited to be combining our business with Backstage Play. “Over the past 4 years eUnited has become one of the more popular and successful esports teams competing at the highest levels. We have proven our ability to win world championships and create a globally recognized brand. The merger allows eUnited to continue to grow the competitive side of its business while also building out a platform that leverages the entire esports ecosystem. Marrying our expertise in competitive esports and digital media with the social gaming technology of Backstage Play is powerful and represents the next step in our evolution of creating a dynamic and diversified esports and digital entertainment company.”
