NorthStar Completes $10.3 Million Financing

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TORONTO, ONTARIO – (October 31, 2023) – NorthStar Gaming Holdings Inc. (TSX-V:BET) (“NorthStar” or the “Company”) today announces that it has closed its previously announced private placement financing of approximately $10.3 million, consisting of common shares, warrants and convertible debentures (the “Offering”). All dollar figures are quoted in Canadian dollars.

Pursuant to the Offering, NorthStar has issued 29,528,458 units (the “Units”) at a price of $0.175 per Unit, with each Unit comprised of one common share of the Company (a “Common Share”), one half warrant to acquire Common Shares exercisable at $0.36 per full warrant (each such whole warrant an “A Warrant”), and a further half warrant to acquire Common Shares exercisable at $0.40 per full warrant (each such whole warrant a “B Warrant”), in each case for a period of five years. In addition, the Company has issued three-year, 8% unsecured convertible debentures (“Convertible Debentures”) in the aggregate principal amount of approximately $5.2 million, converting into Common Shares at $0.20 per share with interest payable-in-kind. Investors in the Offering include Playtech plc (“Playtech”), a global leader in gambling technology that is a supplier of software and services to, and already a significant investor in, the Company, as well as members of the Company’s senior management team.  All securities issued pursuant to the Offering are legended and restricted from trading until March 1, 2024.

Proceeds from the Offering will be utilized to fund NorthStar’s expansion across Canada and for general working capital purposes.

“This injection of capital will strengthen our balance sheet and fund our continued growth,” said Michael Moskowitz, Chair and CEO of NorthStar. “In particular, the Canada-wide re-branding of Spreads.ca into NorthStarBets.com is expected to supplement the strong organic growth we continue to deliver in our initial market.”

Pursuant to the terms of the Investor Rights Agreement dated December 19, 2022 between Playtech and the Company (the “Investor Rights Agreement”), as a result of the increase in Playtech’s ownership interest in the Company because of the Offering, Playtech now has the right to nominate up to four individuals to the Company’s board of directors. Prior to completion of the Offering, Playtech had nominated one individual to the Company’s board of directors, Chris McGinnis, Playtech’s Chief Financial Officer, and upon completion of the Offering, Playtech has elected to nominate one additional member to the board of directors. Alex Latner, General Counsel of Playtech, has now been appointed to the Company’s board of directors.  Playtech retains the right to nominate up to two additional directors in the future.

As previously disclosed on September 22, 2023, the participation of Playtech and other insiders in the transaction (the “Related Party Participation”) constitutes a related party transaction under Multilateral Instrument 61-101 (“MI 61-101”).  The Related Party Participation was exempt from the valuation requirements of MI 61-101 under Section 5.5(b) of MI 61-101.  Minority shareholder approval was obtained to the Related Party Participation by way of written consent pursuant to the decision of the OSC issued on October 26, 2023 and the policies of the TSXV.

Early Warning Disclosure Regarding Playtech

In the Offering, Playtech acquired 28,571,428 Units (comprised of 28,571,428 Common Shares, 14,285,714 A Warrants and 14,285,714 B Warrants) for $0.175 per Unit and a Convertible Debenture with an initial outstanding principal amount of $5.0 million, for aggregate consideration of $10.0 million.

Immediately prior to the completion of the Offering, Playtech beneficially owned, directly or indirectly, or exercised control or direction over, 24,500,000 Common Shares, 12,250,000 warrants to acquire Common Shares exercisable at a price of $0.85 per Common Share until March 3, 2028 and 12,250,000 warrants to acquire Common Shares exercisable at a price of $0.90 per Common Share until March 3, 2028 (together, the “Current Warrants”), representing approximately 15.01% of the issued and outstanding Common Shares on a non-diluted basis and 26.10% on a partially diluted basis.

Immediately following the closing of the Offering, Playtech beneficially owned, directly or indirectly, or exercised control or direction over, 53,071,428 Common Shares, the Current Warrants, 14,285,714 A Warrants, 14,285,714 B Warrants and a Convertible Debenture with an outstanding principal amount of $5.0 million, representing approximately 27.53% of the issued and outstanding Common Shares on a non-diluted basis and 48.42% on a partially diluted basis.

Playtech acquired the securities of the Company as part of its continuing strategic investment in the Company. Playtech intends to review its investment in the Company on a continuing basis and may, from time to time and at any time, and depending on market and other conditions, acquire or dispose of the Company’s equity or debt securities or instruments through open market transactions, private placements and other privately negotiated transactions, or otherwise (including through exercising rights provided to Playtech in the Investor Rights Agreement and in the Registration Rights Agreement dated December 19, 2022 between Playtech and the Company), in each case, depending on a number of factors, including general market and economic conditions and other factors and conditions Playtech deems appropriate.

Playtech is a company incorporated under the laws of the Isle of Man with a registered address of Ground Floor, St George’s Court, Upper Church Street, Douglas, Isle of Man, IM1 1EE. Founded in 1999 and premium listed on the Main Market of the London Stock Exchange, Playtech is a technology leader in the gambling industry with over 7,300 employees across 19 countries. Playtech is the gambling industry’s leading technology company delivering business intelligence driven gambling software, services, content and platform technology across the industry’s most popular product verticals, including, casino, live casino, sports betting, virtual sports, bingo and poker.

An early warning report will be filed by Playtech under applicable Canadian securities laws and once filed will be available under the Company’s SEDAR profile. A copy of such report may also be obtained by contacting Sandeep Gandhi, Head of Investor Relations, Playtech, at +44 (0)1624 645954 or ir@playtech.com.

About NorthStar

NorthStar proudly owns and operates NorthStarbets.ca, a made-in-Ontario casino and sportsbook gaming platform that provides players with a uniquely local, premier user experience. The NorthStar Bets sportsbook provides real-time news, stats, analysis and scores directly in the betting environment along with the most popular online casino games. NorthStar also provides managed services to Northstarbets.com an iGaming site owned and operated by the Abenaki Council of Wolinak.

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A Canadian company, NorthStar is uniquely positioned to become a convergence leader in the intersection of sports media and sports wagering thanks to its partnerships and agreements with leading media companies. NorthStar is committed to operating at the highest level of responsible gaming standards.

NorthStar’s registered address is Suite 503 – 905 West Pender Street, Vancouver, B.C. V6C 1H2 and its principal place of business is located at 220 King St. West, Suite 200, Toronto, Ontario, M5H 1K4, Canada.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

Cautionary Note Regarding Forward-Looking Information and Statements

This communication contains “forward-looking information” within the meaning of applicable securities laws in Canada (“forward-looking statements”), including without limitation, statements with respect to the following: financial guidance for 2023; expected performance of the Company’s business; expansion into new markets and future growth opportunities and expected benefits of transactions; and the use of proceeds of the Offering. Forward-looking statements are provided for the purpose of presenting information about management’s current expectations and plans relating to the future and allowing readers to get a better understanding of the Company’s anticipated financial position, results of operations, and operating environment. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “continues”, “forecasts”, “projects”, “predicts”, “intends”, “anticipates” or “believes”, or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “should”, “might” or “will” be taken, occur or be achieved. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such factors include, among others, the following: risks related to the Company’s business and financial position; risks associated with general economic conditions; adverse industry risks; future legislative and regulatory developments; and the ability of the Company to implement its business strategies. NorthStar believes the expectations reflected in such forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Information contained in forward-looking statements in this communication are provided as of the date hereof and NorthStar disclaims any obligation to update any forward-looking statements, whether as a result of new information or future events or results, except to the extent required by applicable securities laws.

For further information: 
NorthStar Gaming
Corey Goodman

647-530-2387

investorrelations@northstargaming.ca