Announcement • Mar 08
GameSquare Holdings, Inc. (TSXV:GAME) completed the acquisition of FaZe Holdings Inc. (NasdaqCM:FAZE) ("FaZe Clan") from AEV Esports, LLC, B. Riley Principal Investments, LLC and TF US 2 AS. GameSquare Holdings, Inc. (TSXV:GAME) entered into a definitive agreement to acquire FaZe Holdings Inc. (NasdaqCM:FAZE) ("FaZe Clan") from AEV Esports, LLC, B. Riley Principal Investments, LLC and TF US 2 AS for approximately $17 million on October 19, 2023. Under the terms and conditions of the transaction, each issued and outstanding share of FaZe Clan common stock will be converted into the right to receive 0.13091 shares of GameSquare's common stock. Upon completion of the transaction, current GameSquare shareholders will own approximately 55% of the combined company, while current FaZe Clan shareholders will own approximately 45%. Under the terms of the agreement, upon closing of the transaction, nine directors will be appointed to GameSquare's Board of Directors, with six to be designated by GameSquare, two to be designated by FaZe Clan and one to be mutually agreed by GameSquare and FaZe Clan. A Special Meeting of FaZe will be held on February 16, 2024.
The transaction is subject to approval of the Merger Agreement by the stockholders of FaZe and GameSquare; the shares of GameSquare Common Stock issued as merger consideration shall have been approved for listing on the Nasdaq Capital Market; the registration statement filed by GameSquare in connection with the issuance shares of GameSquare Common Stock shall have be declared effective by the U.S. Securities and Exchange Commission; all required filings shall have been made and all required approvals obtained (or waiting periods expired or terminated) under any applicable antitrust law and regulatory approvals; and the absence of any law or order prohibiting consummation of the merger. The boards of directors of FaZe Clan and GameSquare have unanimously approved the transaction. The transaction is expected to close in the fourth quarter of 2023. As of February 22, 2024, stockholders of FaZe Holdings Inc. have voted to approve the proposed merger with GameSquare Holdings, Inc. As of stockholders of GameSquare Holdings have voted to approve the proposed merger with FaZe Holdings Inc. As a result of the merger, and effective as of the close of trading on March 8, 2024, FaZe's common stock (NASDAQ:FAZE) and FaZe warrants (NASDAQ:FAZEW) will cease trading.
Oak Hills Securities, Inc. served as GameSquare's exclusive financial advisor and Bryan N. Wasser and Alan A. Lanis of Baker Hostetler LLP is its legal advisor. FaZe Clan's legal advisor is D. Thomas Triggs and Brian A. Sullivan of Sullivan & Triggs, LLP. Current Capital Securities LLC acted as financial advisor and rendered a fairness opinion to the Board of Directors of FaZe Clan in connection with the transaction. Continental Stock Transfer & Trust Company acted as transfer agent and Morrow Sodali LLC acted as an information agent for FaZe Clan. FaZe estimates that it will pay Morrow Sodali LLC a fee of approximately $15,000, plus reimbursement for certain out-of-pocket fees and expenses. Computershare Trust Company of Canada is the registrar and transfer agent for the GameSquare Shares. Blake, Cassels & Graydon LLP serves as Canadian counsel to GameSquare.
GameSquare Holdings, Inc. (TSXV:GAME) completed the acquisition of FaZe Holdings Inc. (NasdaqCM:FAZE) ("FaZe Clan") from AEV Esports, LLC, B. Riley Principal Investments, LLC and TF US 2 AS on March 8, 2024. New Risk • Jan 23
New major risk - Share price stability The company's share price has been highly volatile over the past 3 months. It is more volatile than 90% of American stocks, typically moving 32% a week. This is considered a major risk. Share price volatility increases the risk of potential losses in the short-term as the stock tends to have larger drops in price more frequently than other stocks. It may also indicate the stock is highly sensitive to market conditions or economic conditions rather than being sensitive to its own business performance, which may also be inconsistent. Currently, the following risks have been identified for the company: Major Risks Less than 1 year of cash runway based on free cash flow trend (-US$28m free cash flow). Share price has been highly volatile over the past 3 months (32% average weekly change). Earnings have declined by 44% per year over the past 5 years. Minor Risks Shareholders have been diluted in the past year (6.9% increase in shares outstanding). Market cap is less than US$100m (US$12.0m market cap). 
