Super League Announces Private Placement Financing of $8.354 Million and Enters into Accounts Receivable Facility to Further Fund Growth Initiatives
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Insights
The recent financing activities by Super League involve a private placement of convertible preferred stock and an accounts receivable financing facility. The capital raised, totaling approximately $8.354 million and the additional credit facility of up to $4 million, are intended to provide the company with the necessary liquidity to sustain operations and pursue growth strategies. The convertible nature of the preferred stock allows investors to convert their holdings into common stock, which could potentially dilute existing shareholders but also reflects investor confidence in the company's future.
From a financial perspective, the use of convertible securities and accounts receivable financing indicates a strategic approach to managing the company's capital structure and liquidity without resorting to more expensive forms of debt. The focus on maintaining operational funding and driving growth initiatives suggests that the company is actively working towards achieving profitability in 2024, as stated by the CEO. Investors should monitor the company's subsequent use of the proceeds and its impact on operational performance.
Super League's strategic decision to secure funding through a convertible preferred stock issuance and an accounts receivable financing aligns with broader industry trends where tech and entertainment companies seek alternative financing routes to bolster their capital without excessively leveraging. The involvement of both new and existing investors, along with the participation of affiliates of the placement agent, indicates a diverse investor base with varying degrees of risk tolerance and expectations.
Given Super League's position in the digital social platform space, the capital infusion is likely to enhance its competitive edge by enabling investments in innovative experiences and technologies. However, the company must navigate the inherent risks of dilution and manage the preferred stock's conversion terms to maintain shareholder value. Industry peers and investors will likely assess Super League's performance following this capital raise to gauge the efficacy of such financing strategies in driving sustainable growth.
The issuance of Series AAA Convertible Preferred Stock and the establishment of an accounts receivable financing facility have legal implications, particularly concerning securities regulations. The fact that the securities have not been registered under the Securities Act of 1933, as amended, limits their resale to certain conditions such as an effective registration statement or an exemption from registration. This aspect is crucial for investors to understand as it affects the liquidity and transferability of these securities.
Furthermore, the registration rights granted to investors and the beneficial ownership limitations referenced in the company's Form 8-K filings with the SEC underscore the importance of compliance with federal securities laws. Potential investors and current shareholders must be aware of these terms to fully comprehend their rights and the potential impact on their investments. Companies undertaking similar financing transactions must carefully navigate these legal requirements to ensure the legitimacy and success of their offerings.
SANTA MONICA, Calif., Dec. 22, 2023 (GLOBE NEWSWIRE) -- Super League (Nasdaq: SLE), a global leader in providing immersive experiences across the world's largest digital social platforms, announced today that it has consummated two tranches of private financing of convertible preferred stock, priced at the market under Nasdaq rules, with the final closing completed on December 22, 2023. Additionally, the Company entered into an agreement with SLR DIGITAL FINANCE LLC for a 2-year,
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“The completion of this financing comes at an integral inflection point in Super League’s business as we secured our largest single revenue transaction to date in the third quarter. This latest private financing capital injection along with the AR facility will effectively fund our operations, facilitate the execution of our growth initiatives, and secure our 2024 path to profitability,” commented Ann Hand, CEO of Super League. “We would like to thank our investors, both new and existing, for their continued support and confidence in the strategic direction of Super League.”
As a part of the private placement offering, the Company issued newly designated Series AAA Convertible Preferred Stock (the "Preferred Stock"). Each share of Preferred Stock was sold in two separate tranches, with the tranches priced at
SternAegis Ventures acted as the exclusive placement agent. Participants in the offering include existing investors, new investors, and affiliates of the placement agent.
The securities described above have not been registered under the Securities Act of 1933, as amended, and may not be resold in the United States except pursuant to an effective registration statement with the Securities and Exchange Commission or an exemption from registration under the Securities Act and any applicable state securities laws.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or other jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Super League
Super League (Nasdaq: SLE) is a leading strategically-integrated publisher and creator of games and experiences across the world’s largest immersive digital platforms. From metaverse gaming powerhouses such as Roblox, Minecraft and Fortnite, to the most popular Web3 environments such as Sandbox and Decentraland, to bespoke worlds built using the most advanced 3D creation tools, Super League’s innovative solutions provide incomparable access to massive audiences who gather in immersive digital spaces to socialize, play, explore, collaborate, shop, learn and create. As a true end-to-end activation partner for dozens of global brands, Super League offers a complete range of development, distribution, monetization and optimization capabilities designed to engage users through dynamic, energized programs. As an originator of new experiences fueled by a network of top developers, a comprehensive set of proprietary creator tools and a future-forward team of creative professionals, Super League accelerates IP and audience success within the fastest growing sector of the media industry. For more, go to superleague.com.
About SternAegis Ventures
SternAegis Ventures is the management team within Aegis Capital Corp. that is responsible for venture capital and private equity financing.
www.sternaegis.com
Forward-Looking Statements
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995. Statements in this press release that are not strictly historical are “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements involve substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. Forward-looking statements in this communication include, among other things, statements about Super League’s growth and growth strategies, the ability to actualize the benefits of the acquisition of Melon, our possible or assumed business strategies, new products, potential market opportunities and our ability to secure adequate working capital. Risks and uncertainties include, among other things, our ability to implement our plans, forecasts and other expectations with respect to our business; our ability to realize the anticipated benefits of events that took place during and subsequent to the quarter ended September 30, 2023, including the possibility that the expected benefits, particularly from our acquisitions consummated in 2021 and 2023, will not be realized or will not be realized within the expected time period; unknown liabilities that may or may not be within our control; attracting new customers and maintaining and expanding our existing customer base; our ability to scale and update our platform to respond to customers’ needs and rapid technological change; increased competition in our market and our ability to compete effectively; and expansion of our operations and increased adoption of our platform internationally. Additional risks and uncertainties that could affect our financial condition and operating results will be included in the section titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022 and other filings that we make from time to time with the Securities and Exchange Commission (the “SEC”) which, once filed, are available on the SEC’s website at www.sec.gov. In addition, any forward-looking statements contained in this communication are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.
Investor Relations Contact:
Shannon Devine/ Mark Schwalenberg
MZ North America
Main: 203-741-8811
SLE@mzgroup.us
Media Contact
Gillian Sheldon
gillian.sheldon@superleague.com
FAQ
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