Enthusiast Gaming Holdings Inc. announced that it has entered into a credit agreement for a gross proceeds of CAD 20 million led by new investor, Beedie Investments Ltd. on July 11, 2024. The transaction also included participation from a syndicate of other investors. the company has issued four-year non-revolving term loan.

The Term Loan bears interest at a fixed rate of 14.0% per annum calculated and payable monthly in arrears. The Company will have the option until January 31, 2025 to pay the monthly interest in kind by adding accrued interest for that month to the outstanding principal amount of the Term Loan, which PIK Interest will accrue interest compounded monthly and be added to the outstanding principal amount of the Term Loan. After January 31, 2025, interest must be paid in cash for the remainder of the loan?s term to maturity.

The Term Loan will have a term of four years from the date of the close of the Term Loan and may be prepaid, subject to certain conditions including the payment of applicable prepayment fees. The Term Loan will be guaranteed by certain Canadian and U.S. subsidiaries of the Company and secured by a second ranking security interest over substantially all of the assets of the Company and the guarantor subsidiaries. The Company has issued to the lending syndicate in aggregate 37,037,037 common share purchase warrants, at an exercise price of CAD 0.135 per Common Share, equal to a 15% premium to the five consecutive trading day volume-weighted average price of the Common Shares.

The Warrants will not be listed on any exchange. Each Warrant is exercisable to purchase one Common Share and will expire on July 12, 2029. Of the aggregate 37,037,037 Warrants issued by the Company, the Lender received 6,574,074 Warrants.