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Nasdaq:LTRY

Lottery.com Announces Strong Fourth Quarter and Full Year Results

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Fourth quarter 2021 revenue of $21.5 million, up $18.2 million versus prior-year period

Full year 2021 revenue of $68.5 million, an increase of $61.0 million versus 2020

Full year 2021 pro forma revenue of $70.5 million, including acquired interest in Mexican entities¹

Full year 2021 net loss of $9.3 million

Full year 2021 Adjusted EBITDA of $31.1 million¹

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AUSTIN, Texas, March 31, 2022 (GLOBE NEWSWIRE) — Lottery.com Inc. (Nasdaq: LTRY, LTRYW) (“Lottery.com” or the “Company”), a leading technology company that is transforming how, where and when the lottery is played, reported financial results for the fourth quarter and full year ended December 31, 2021. On October 29, 2021, the Company successfully completed its business combination with Trident Acquisitions Corp. (the “business combination”).

Tony DiMatteo, Lottery.com Co-Founder and CEO, commented, “In the fourth quarter and throughout 2021, we demonstrated our ability to execute our strategic growth initiatives across the business to generate strong revenue growth and gross profit. B2C sales increased compared to the prior year period, despite no digital marketing spending. LotteryLink, our affiliate program, expanded and generated multiple revenue streams. I am extremely proud of our team achieving these accomplishments while successfully closing the business combination and taking our Company public.”

Mr. DiMatteo continued, “We entered 2022 with positive momentum and continued focus on executing our strategic growth plan. Fueled by approximately $43 million of proceeds from our business combination and $30 million received from the sale of LotteryLink credits, we are investing in initiatives to drive growth. I am pleased with our execution in the first quarter and am excited about our prospects to scale and grow the business in 2022.”

(1) 2021 Pro Forma Revenue and Full Year 2021 Adjusted EBITDA are financial measures that are not calculated in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”). See “Non-GAAP Financial Measures” below for a discussion of the definition of these non-GAAP financial measures and “Reconciliation of Non-GAAP Financial Measures” for a reconciliation to their most comparable GAAP measures.

Fourth Quarter 2021 Financial Highlights

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Q4 2021 Financial Highlights   Three Months Ended
December 31,
   
    2021   2020   Change
(in millions)                  
Revenues   $ 21.5     $ 3.3     $ 18.2  
Gross profit   $ 18.3     $ 2.1     $ 16.2  
Net loss   $ (12.9 )   $ (1.7 )   $ (11.2 )
Cash   $ 62.6     $ 3.8     $ 58.8  
Debt   $ 3.8     $ 21.1     $ (17.3 )


Fourth quarter 2021 revenues
were $21.5 million, an increase of $18.2 million, or 559%, from the fourth quarter of 2020. The growth was driven by the sale of LotteryLink credits to a LotteryLink affiliate, primarily to acquire prepaid lottery games from the Company in conjunction with the affiliate’s launch of a pilot promotional campaign at a national grocery chain. The Company also sold LotteryLink credits for marketing materials, product development and $3.0 million in prepaid advertising credits. B2C lottery ticket sales increased substantially from the prior year period, despite no digital marketing spend.

Fourth quarter 2021 gross profit was $18.3 million, an increase of $16.2 million from the fourth quarter of 2020. The increase was primarily driven by the sale of LotteryLink credits to a LotteryLink affiliate for prepaid lottery games from the Company, many of which expired without being redeemed due to the delayed launch of the affiliate’s promotional programs. As a result, the Company did not incur costs with respect to the sale of those credits.

Fourth quarter 2021 net loss was $12.9 million, driven by non-cash stock compensation expense of $15.5 million. The net loss also included $8.8 million of interest expense, which was driven by a non-recurring expense associated with conversion of debt to equity at the time of the business combination.

Cash as of December 31, 2021, was $62.6 million, which included $42.8 million in net proceeds from the business combination and $30.0 million received from the previously announced sale of LotteryLink credits in the third quarter of 2021.

Debt as of December 31, 2021, was $3.8 million following the conversion of $63.5 million of convertible debt into equity immediately prior to the business combination.

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Full Year 2021 Financial Highlights

2021 Financial Highlights   Twelve Months Ended
December 31,
   
    2021   2020   Change
(in millions)                  
Revenues   $ 68.5     $ 7.5     $ 61.0  
Pro forma revenues   $ 70.5     $ 10.3     $ 60.2  
Gross profit   $ 49.4     $ 4.5     $ 44.9  
Net loss   $ (9.3 )   $ (5.8 )   $ (3.5 )
Adjusted EBITDA   $ 31.1     $ (3.1 )   $ 34.2  
                         

Full year 2021 revenues were $68.5 million, an increase of $61.0 million, or 819%, from 2020. The growth was driven primarily by the sale of $47.1 million of LotteryLink credits for prepaid advertising, prepaid lottery games, marketing materials and product development. Increased B2C sales also contributed to revenue growth.

2021 pro forma revenues were $70.5 million and included the full year impact of Global Gaming Enterprises, Inc. (“Global Gaming”), which the Company acquired in June 2021. Global Gaming owns an 80% equity interest in each of two Mexican entities.

Full year 2021 gross profit was $49.4 million, an increase of $44.9 million from 2020. The increase was primarily driven by the profits generated by the sale of LotteryLink credits and higher data sales, which generate margins above the Company average.

Full year 2021 net loss was $9.3 million and was driven by strong gross profit, offset by $18.1 million of interest expense, which includes a non-recurring expense associated with the conversion of debt to equity at the time of the business combination, $15.5 million of non-cash stock compensation expense, and $4.1 million of operational expenses related to the business combination.

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Full year 2021 Adjusted EBITDA was $31.1 million, an increase of $34.2 million compared to negative Adjusted EBITDA of $3.1 million in 2020. The increase was driven by strong growth in gross profit.

Update on Key Initiatives

  • B2C User Growth
    • Signed an agreement with T-Mobile to become its exclusive digital lottery brand advertising on T-Mobile platform in rideshare vehicles.
    • Tested B2C ad campaigns on multiple digital outlets in the first quarter of 2022 and intend to use this data to launch broader marketing campaigns in the second quarter of 2022.
  • LotteryLink and B2B
    • LotteryLink affiliate launched a pilot program with a national grocery store chain, which is expected to expand in the second quarter of 2022.
    • Added ICARO Media Group as an affiliate to promote Lottery.com B2C products in South America.
  • Project Nexus
    • Phase 1: Launch anticipated in early Q2 2022; expected to increase platform scalability, security, and the ability to implement product updates.
    • Phase 2: Launch anticipated by the end of Q3 2022; expected to enable additional revenue generating features for existing products.
    • Phase 3: Launch anticipated by the end of Q4 2022; expected to enable the support of a proprietary game that accepts payment in fiat or crypto currency, subject to regulatory and compliance requirements.
  • New Markets
    • Anticipate entry into five new domestic jurisdictions by the end of 2022.

Conference Call

This morning at 8:30 AM ET, the Company will host a conference call to discuss fourth quarter 2021 and full year 2021 results. A live webcast of the conference call will be available on the Investor Relations section of the Lottery.com website at https://ir.lottery.com. For those who cannot listen to the live webcast, a replay of the conference call will be available on the Lottery.com Investor Relations website.

To join by telephone, please dial 877-313-2495 or 929-517-0906 if calling from outside the U.S. The conference code is 5886747. Please dial in a minimum of 15 minutes prior to the start time to ensure a timely connection to the call. An operator will register your name and organization.

About Lottery.com

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Lottery.com is a leading technology company that is transforming how, where and when lottery is played. Its engaging mobile and online platforms enable players located in the United States and internationally to remotely purchase legally sanctioned lottery games. Fans and subscribers look to Lottery.com for compelling, real-time results on more than 800 lottery games from more than 40 countries. Additionally, commercial partners and affiliates can utilize LotteryLink to provide Lottery.com products to their customers. Through WinTogether.org, Lottery.com is fundamentally changing how non-profit donors are incentivized to action by gamifying charitable giving. In all that it does, Lottery.com’s mission remains the same: an uncompromising passion to innovate, grow a new demographic of enthusiasts, deliver responsible and trusted solutions, and promote community and philanthropic initiatives. For more information, visit http://www.lottery.com.

Non-GAAP Financial Measures

This press release includes Pro Forma Revenue, EBITDA and Adjusted EBITDA, which are non-GAAP performance measures that we use to supplement our results presented in accordance with U.S. GAAP. We believe Pro Forma Revenue, EBITDA and Adjusted EBITDA are useful in evaluating our operating performance, similar to measures reported by our publicly-listed U.S. competitors, and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Pro Forma Revenue, EBITDA and Adjusted EBITDA are not intended to be substitutes for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

We define and calculate Pro Forma Revenue as revenue plus the impact on revenue as if the acquisition of Global Gaming by Lottery.com were consummated on January 1, 2020. We define and calculate EBITDA as net income or loss before the impact of interest income or expense, income tax expense or benefit, depreciation and amortization, and Adjusted EBITDA as EBITDA, as further adjusted for stock-based compensation and certain other non-recurring, non-cash or non-core items.

We include these non-GAAP financial measures because they are used by management to evaluate our core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. The financial statement tables that accompany this press release include a reconciliation of Pro Forma Revenue, EBITDA and Adjusted EBITDA to their most comparable U.S. GAAP financial measures.

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Forward Looking Statements

This press release contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in this press release, regarding Lottery.com’s strategy, future operations, prospects, plans and objectives of management, are forward-looking statements. When used in this press release, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Lottery.com disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. Lottery.com cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Lottery.com. In addition, Lottery.com cautions you that the forward-looking statements contained in this press release are subject to the following factors: (i) risks related to the timely implementation, launch or outcome of the Company’s technological development initiatives, including Project Nexus, as anticipated, or at all, and the risk that any of such technological development initiatives could have undetected defects or errors; (ii) the likelihood that the Company’s interest expense is maintained as the Company’s anticipates and the impact on the Company’s financial position in the event that it is not; (iii) the utility and impact of any information acquired by the Company during consumer testing as well as the risks of the data being applicable to a wider and more diverse consumer market; (iv) the ability of Lottery.com to achieve its strategic and growth objectives as stated or at all, including, without limitation, its ability to enter into new domestic jurisdictions or to cause LotteryLink to generate profitable growth and cost-effectively increase the Company’s user base and brand recognition; (v) the effects of competition on Lottery.com’s future business; (vi) Lottery.com’s ability to maintain effective internal controls over financial reporting, including, without limitation, the remediation of identified material weaknesses in internal control over financial reporting relating to segregation of duties with respect to, and access controls to, its financial record keeping system, and Lottery.com’s accounting staffing levels; (vii) risks relating to cyber, privacy and data protection laws, cyber, privacy or data breaches, or the loss of data; (viii) the outcome of any legal proceedings that may be instituted against Lottery.com; (ix) changes in applicable laws or regulations; (x) risks related to the COVID-19 pandemic and its effect directly on Lottery.com and the economy generally; (xi) the possibility that Lottery.com may be adversely affected by other economic, business, and/or competitive factors; (xii) those factors discussed under the heading “Risk Factors” in the Form S-1 filed by Lottery.com with the SEC on November 18, 2021, and the other documents filed, or to be filed, by Lottery.com with the SEC. Should one or more of the risks or uncertainties described in this press release materialize or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the reports that Lottery.com has filed and will file from time to time with the SEC. These SEC filings are available publicly on the SEC’s website at www.sec.gov.

 
Lottery.com Inc.
Condensed Consolidated Statements of Operations
Three Months Ended December 31, 2021 and 2020 and Twelve Months Ended
December 31, 2021 and 2020
                         
    Three Months Ended   Twelve Months Ended
  December 31, December 31,
    2021   2020   2021   2020
    (unaudited)   (unaudited)
Revenue   $ 21,492,067     $ 3,262,200     $ 68,527,394     $ 7,459,514  
Cost of revenue     3,233,635       1,181,530       19,158,707       2,952,415  
Gross profit     18,258,432       2,080,670       49,368,687       4,507,099  
                         
Operating expenses:                        
Personnel costs     17,447,294       1,502,491       21,585,534       4,477,955  
Professional fees     3,105,420       482,340       8,279,798       1,121,218  
General and administrative     664,735       491,404       5,020,495       1,084,784  
Depreciation and amortization     1,388,606       468,504       4,292,606       1,533,994  
Total operating expenses     22,606,055       2,944,740       39,178,433       8,217,951  
Income (loss) from operations     (4,347,623 )     (864,070 )     10,190,254       (3,710,852 )
                         
Other expenses                        
Interest expense     8,814,314       340,375       18,132,952       1,221,928  
Other expense     1,250,978       462,225       2,907,518       879,083  
Total other expenses, net     10,065,292       802,600       21,040,470       2,101,011  
                         
Net loss before income tax     (14,412,915 )     (1,666,670 )     (10,850,216 )     (5,811,863 )
                         
Income tax expense (benefit)     (1,551,689 )     800       (1,551,689 )     800  
                         
Net loss   $ (12,861,226 )   $ (1,667,470 )   $ (9,298,527 )   $ (5,812,663 )
                         
Other comprehensive loss                        
Cumulative translation adjusment, net     (655 )           (655 )      
Total other comprehensive loss   $ (12,861,881 )   $ (1,667,470 )   $ (9,299,182 )   $ (5,812,663 )
                         
Net income (loss) per common share                        
Basic and diluted   $ (0.39 )   $ (0.07 )   $ (0.36 )   $ (0.26 )
                         
Weighted average common shares outstanding                        
Basic and diluted     33,202,310       22,658,006       25,998,831       22,658,006  

Lottery.com Inc
Condensed Consolidated Balance Sheet
Unaudited      
       
    As of December 31,   As of December 31,
      2021       2020  
       
Assets      
Cash   $ 62,638,970     $ 3,825,511  
Restricted cash           6,950,000  
Accounts receivable     21,696,653       26,195  
Prepaid expenses     13,896,638       22,013,110  
Other current assets     226,200       788,033  
Total current assets     98,458,461       33,602,849  
Investments     250,000       250,000  
Goodwill     19,590,758       12,997,048  
Intangible assets, net     28,710,980       3,211,250  
Property and equipment, net     141,279       670,952  
Total assets   $ 147,151,478     $ 50,732,099  
       
Liabilities      
Trade payables   $ 1,006,535     $ 2,176,621  
Deferred revenue     662,335       7,763,593  
Convertible debt, net – current           8,882,665  
Notes payable – current     3,771,340       12,207,180  
Accrued interest     176,260       721,717  
Accrued and other expenses     4,528,815       2,335,350  
Total current liabilities     10,145,285       34,087,126  
Convertible debt, net – non current           10,000  
Other long term liabilities     1,169        
Total liabilities     10,146,454       34,097,126  
       
Equity      
Controlling Interest      
       
Preferred Stock par value $0.001, 1,000,000 shares authorized,                
none issued and outstanding            
Common stock par value $.001, 500,000,000 shares authorized,             22,658  
46,808,251 and 22,658,006 issued and outstanding as of December                
31, 2021 and December 31, 2020 respectively     46,808       22,658  
Additional paid-in capital     238,754,797       111,752,883  
Accumulated other comprehensive (loss)     (655 )      
Accumulated deficit     (104,439,095 )     (95,140,568 )
Total Lottery.com Inc. stockholder’s equity     134,361,855       16,634,973  
Noncontrolling Interest     2,643,169        
Total Equity     137,005,024       16,634,973  
Total Liabilities & Equity   $ 147,151,478     $ 50,732,099  

Lottery.com Inc.
Condensed Consolidated Statement of Cash Flows
(unaudited)
    Year Ended December 31,
      2021       2020  
       
Cash flow from operating activities      
Net income (loss)   $ (9,298,527 )   $ (5,812,663 )
Adjustments to reconcile net loss to net cash used in operating activities:      
Depreciation and amortization     4,292,606       1,533,994  
Amortization of debt discount and beneficial conversion feature     8,474,858       827,647  
Stock based compensation expense     15,532,263       16,099  
Forgiveness of PPP Loan     (493,125 )      
Loss on extinguishment of debt     71,174        
Issuance of debt to pay expenses     2,732,167        
Non cash deSPAC expense     5,460,452        
Income tax valuation allowance     (1,653,067 )  
       
Changes in assets & liabilities:      
Accounts receivable     (21,636,324 )      
Prepaid expenses     8,121,496       295,772  
Other current assets     827,625       (38,167 )
Trade payables     (1,171,557 )     (341,251 )
Deferred revenue     (7,101,258 )     7,647,305  
Accrued interest     (545,456 )     394,282  
Accrued and other expenses     3,277,745       174,023  
Other long term liabilities     1,169        
Net cash provided by operating activities     6,892,239       4,697,041  
       
Cash flow from investing activities      
Purchases of property and equipment     (28,170 )     (21,915 )
Purchases of intangible assets     (5,192,050 )      
Investment in subsidiary     (10,012,540 )      
Net cash used in investing activities     (15,232,760 )     (21,915 )
       
Cash flow from financing activities      
Issuance of digital securities     108,332       649,992  
Proceeds from exercise of options and warrants     371,726        
Proceeds from issuance of convertible debt     23,483,500       5,271,363  
Proceeds from the issuance of notes payable     5,000,000       910,825  
Proceeds from despac     44,614        
Extinguishment of debt     42,794,176        
Principal payments on debt     (11,597,713 )     (890,287 )
Net cash provided by financing activities     60,204,635       5,941,893  
Effect of exchange rate changes on cash     (655 )      
Net change in net cash and restricted cash     51,863,460       10,617,020  
Cash and restricted cash at beginning of period     10,775,511       158,492  
Cash and restricted cash at end of period   $ 62,638,971     $ 10,775,511  
       
SUPPLEMENTAL DISCLOSURES:      
Interest paid in cash   $ 4,438,623     $  
Non cash investing and financing activities      
Conversion of convertible debt into common stock   $ 63,484,240     $  
Capitalization of interest from loan extinguishment   $ 44,614    
Purchase of intangible assets through the issuance of convertible debt   $ 15,450,000     $  
Issuance of convertible debt in exchange for outstanding liabilities   $ 2,108,983     $  
Issuance of convertible debt in exchange for notes payable   $ 4,531,250    
Common stock issued as part of acquisition   $ 459,691     $  

 

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Reconciliation of Non-GAAP Financial Measures
 
    Lottery.com Inc.
   
    Reconciliation of Revenues to Pro Forma Revenues
   
                     
    Twelve Months Ended    
    December 31,    
    2021   2020   Change
(in millions)                    
Revenues   $ 68.5     $ 7.5     $ 61.0  
Global Gaming pre-acquisition revenue(1)     2.0       2.9     $ (0.9 )
Pro forma revenues (non-GAAP)   $ 70.5     $ 10.3     $ 60.2  
(1) Giving effect to the acquisition of Global Gaming, which Lottery.com acquired in June 2021, as if it were consummated on January 1, 2020

    Lottery.com Inc.
     
    Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA      
                 
    Twelve Months Ended    
    December 31,    
      2021     2020   Change
(in millions)                
Net income (loss)   $ (9.3 )   $ (5.8 )   $ (3.5 )
Interest expense     18.1       1.2     16.9  
Income tax expense (benefit)     (1.6 )     0.0     (1.6 )
Depreciation and amortization expenses     4.3       1.5     2.8  
EBITDA (non-GAAP)     11.5       (3.1 )   14.6  
                 
Operating expenses related to business combination     4.1           4.1  
Non-cash stock compensation expense     15.5           15.5  
Adjusted EBITDA (non-GAAP)   $ 31.1     $ (3.1 )   $ 34.2  
                         


Lottery.com Contact:
Matthew Schlarb
VP, Investor Relations
(512) 585-7789
[email protected]

or

Jody Burfening/Harriet Fried
LHA Investor Relations
(212) 838-3777
[email protected]

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Nasdaq:LTRY

Lottery.com, Inc. Announces Voluntary Dismissal by Woodford Eurasia Assets of Proxy Misstatement Lawsuit Against Lottery.com and its Directors

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lotterycom,-inc-announces-voluntary-dismissal-by-woodford-eurasia-assets-of-proxy-misstatement-lawsuit-against-lottery.com-and-its-directors

WILMINGTON, Del., Feb. 20, 2024 (GLOBE NEWSWIRE) — Lottery.com Inc., leading online lottery services provider announces that the legal action alleging proxy misstatements filed in federal court by Woodford Eurasia Assets Ltd against Lottery.com and the individual members of the Company’s Board of Directors, including Chairman Matthew McGahan, has been voluntarily dismissed without prejudice by Woodford.

The Notice of Voluntary Dismissal Without Prejudice was filed by Woodford in the United States District Court for the District of Delaware on February 14, 2024 in Case No. 23-1317-GBW, which stated that Woodford provides notice of dismissal of all claims without prejudice against Defendants Lotttery.com and its directors.

This notice of dismissal comes after Woodford filed its Complaint and unsuccessfully sought to enjoin the Company and its directors from holding the Special Meeting of Stakeholders, wherein the shareholders voted to allow the sale of stock that potentially could result in a change of control of the Company to its primary lender, United Capital Investments London Limited (“UCIL”). Woodford’s Motion For A Temporary Restraining Order, Preliminary Injunction and Expedited Discovery was denied by the Court by Memorandum Order on November 17, 2023, in which Honourable Judge Gregory B. Williams stated, the Court is not convinced…the directors’ interest in UCIL substantially change a voter’s mind and is not convinced that [Woodford] has shown a likelihood of success of the merits.” The Court added, publics interest is best served by permitting the Special Meeting to continue in line with the Company’s bylaws.”

With the dismissal of this lawsuit by Woodford, no further action is required by Lottery.com or its directors.

Matthew McGahan, Chairman of Lottery.com and Sports.com, commented:

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“We are pleased to put this matter behind us. This resolution allows us to focus on our mission to offer innovative solutions in the lottery industry and to transform the sports media and entertainment arena with sports.com. We can now get back to focusing on providing value for our customers and stakeholders. We remain committed to operating with the highest standards of integrity and look forward to continuing our work in revolutionising the lottery and sports media experience worldwide. I would like to express my gratitude to our legal advisors, my fellow Board Directors and all those who have supported the company through this process.”

Lottery.com Contact: [email protected]

Lottery.com is a leading technology company that is transforming how, where and when lottery is played. Its engaging mobile and online platforms enable players and commercial partners located in the United States and internationally to remotely purchase legally sanctioned lottery games. Fans and subscribers look to Lottery.com for compelling, real-time results on more than 800 lottery games from more than 40 countries. Additionally, through WinTogether.org, Lottery.com is fundamentally changing how non-profit donors are incentivized to action by gamifying charitable giving. In all that it does, Lottery.com’s mission remains the same: an uncompromising passion to innovate, grow a new demographic of enthusiasts, deliver responsible and trusted solutions, and promote community and philanthropic initiatives. For more information, visit http://www.lottery.com.

About Sports.com

Emerging from the strategic acquisition of SportLocker, Sports.com is poised to become the premier destination for sports entertainment, offering an unparalleled array of interactive and engaging sports content. For more information, visit www.sports.com.

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Important Notice Regarding Forward-Looking Statements

This press release contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in this press release, regarding the company’s future financial performance, as well as the company’s strategy, future operations, revenue guidance, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this press release, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Lottery.com disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. Lottery.com cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Lottery.com. In addition, Lottery.com cautions you that the forward-looking statements contained in this press release are subject to the following factors: (i) the outcome of any legal proceedings that may be instituted against Lottery.com; (ii) Lottery.com’s ability to maintain effective internal controls over financial reporting, including the remediation of identified material weaknesses in internal control over financial reporting relating to segregation of duties with respect to, and access controls to, its financial record keeping system, and Lottery.com’s accounting staffing levels; (iii) the effects of competition on Lottery.com’s future business; (iv) risks related to Lottery.com’s dependence on its intellectual property and the risk that Lottery.com’s technology could have undetected defects or errors; (v) changes in applicable laws or regulations; (vi) risks related to the COVID-19 pandemic and its effect directly on Lottery.com and the economy generally; (vii) risks relating to privacy and data protection laws, privacy or data breaches, or the loss of data; (viii) the possibility that Lottery.com may be adversely affected by other economic, business, and/or competitive factors; (ix) the ability of Lottery.com to achieve its strategic and growth objectives as stated or at all; and (x) those factors discussed in the proxy statement/prospectus filed by Lottery.com with the SEC under the heading “Risk Factors” and the other documents filed, or to be filed, by Lottery.com with the SEC. Should one or more of the risks or uncertainties described in this press release materialize or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the reports that Lottery.com has filed and will file from time to time with the SEC. These SEC filings are available publicly on the SEC’s website at www.sec.gov.

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Lottery.com, Inc. Acquires SportLocker

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Sports.com Unveils Its New Sports Entertainment Platform

AUSTIN, Texas, Feb. 15, 2024 (GLOBE NEWSWIRE) — Lottery.com Inc. (Nasdaq: LTRY, LTRYW) (“Lottery.com” or the “Company”), a leading online lottery services provider announces the strategic acquisition of S&MI Ltd. (“SportLocker”).

As part of the acquisition, SportLocker, rebranded as Sports.com, will immediately launch as a premier platform for sports fans worldwide, marking a pivotal leap in Sports.com’s evolution as the next-gen digital sports entertainment space. The platform merges innovative community-driven aspects with expansive content and technology, creating a new era of sports engagement.

Details of Acquisition

The stock-based acquisition is a significant step in Sports.com’s strategy to diversify and magnify its digital entertainment and sports engagement footprint, introducing a service that seamlessly blends sports and social for a truly immersive fan experience.

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Creating the next Gen Sports Entertainment Platform

Sports.com is poised to redefine digital sports entertainment by introducing a platform that aims to combine: 24 hours of sports news; live streaming; hours of exciting new content, including original documentaries, films, and exclusive behind-the-scenes access. By offering innovative ways for fans to watch sports—when they want, where they want, directly on their devices, regardless of the country—Sports.com is determined to break new ground. Throughout 2024, the Company plans to add additional features to and invest in innovative technologies for Sports.com that focus on immersing sports fans with content that truly matters to them though the establishment of communities and sports-centric social media interactions with some of the biggest stars in sports: past, present, and future.

Creating a New Vision for Sports Entertainment

The Company is initially focused on rolling out Sports.com in the USA and Europe, along with concentrated efforts in the Middle East. Sports.com is determined to expand globally, targeting high-energy sports such as soccer, motor racing (in all forms), football, baseball, basketball, MMA, boxing, cricket, golf, field and ice hockey, and tennis at the grassroots level. A dedicated parallel program committed exclusively to women’s sports is expected to launch, showcasing the latest methods for fan engagement, sponsorship acquisition, and generating new revenue streams for clubs and teams.

The Company previously announced plans for club acquisition, sponsorship, and media partnership programs. These initiatives, initially focused on UK soccer clubs, MLS, and USL, are spearheaded by Marc Bircham, Sports.com head of business development, and they reflect Sports.com’s commitment to making a significant impact in the sports and media landscape, particularly with the American audience in mind, leveraging the vast and lucrative American sports industry.

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Forward-Looking Strategic Direction and Growth Opportunities

Once established in the USA, Europe, and the Middle East, Sports.com plans to extend its reach into Africa, India, South America, Asia and Australia, with a target to deliver the same unparalleled sports content and interactive experiences along with regional sports content. This strategic direction underscores Sports.com’s commitment to driving growth in higher value territories and underserved markets along with prioritizing regions based on their ability to earn greater customer Lifetime Value (LTV). Sports.com envisions delivering comprehensive pre and post-match stats, news, and event highlights across a wide range of major sports such as soccer, golf, tennis, cricket, and more, including:

  • Access to the Indy 500, Dakar Rally, FIA Formula E, and the Formula 1 season.
  • Broadcasts of the PGA Tour, LPGA Tour, and the prestigious Masters Golf Tournament.
  • Comprehensive coverage of tennis Grand Slams, including the Australian Open, French Open, ATP and WTA tours.
  • Special events like the Summer Olympics 2024 and the ICC Men‘s T20 Cricket World Cup.

Enhanced Partnership Model with Mobile Network Operators

A core strategy behind the acquisition of SportLocker and the rebranding to Sports.com includes leveraging its established partnerships with Mobile Network Operators (MNOs) to offer localized branded sports content services. This approach enhances the value proposition for MNOs by servicing the demand for sports video content from large scale audiences across many markets directly onto consumers’ mobile devices.

Driving Growth Through Premium Content and Direct Connections

The SportLocker acquisition is an underlying-element of Sports.com’s accelerated growth strategy and rapid market penetration plan. By focusing on premium content bundling and optimizing its direct connections with MNOs for efficient user acquisition, Sports.com expects to attract exclusive marketing partners to drive and sustainably scale its brand.

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Majed Al Sorour, President of Sports.com and Saudi Golf, and former Director CEO of LIV Golf and Newcastle Football Club, said:

“I am thrilled to lead Sports.com into a new era where technology and passion for sport converge to create unparalleled experiences for fans worldwide. Our vision is to revolutionize fan engagement, making every moment more interactive, accessible, and engaging. Supporting Sports.com at this transformative stage, I look forward to leveraging my experience to catalyze growth, innovation, and community building in the sports and technology landscape.”

Matthew McGahan, Chairman and CEO of Lottery.com and Sports.com, commented:

“This acquisition is of great strategic importance to our group and we are delighted to unveil Sports.com to the world with a revolutionary vision that will transform how fans engage with sports. By integrating SportLocker’s robust MNO partnerships, localized content services and community-focused features with enhanced content and technology, we are creating a dynamic ecosystem where fans can not only consume sports, but also connect and create in ways never before offered to the mass of sports fans worldwide.

“We are positioning Sports.com to offer sports fans an unparalleled year-round experience. The introduction of our media platform is just a glimpse of how we intend to bring fans closer to the sports they love.”

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Tim Scoffham, Founding Partner of SportLocker, added:

“The synergies between SportLocker and Sports.com represent a game-changing evolution in our mission to deliver unmatched sports experiences to fans worldwide. We are excited to join forces with their team, leveraging our combined strengths to redefine the landscape of sports entertainment under the Sports.com brand. Our vision has always been to create a comprehensive platform that serves as the go-to destination for sports fans. With the acquisition of SportLocker, Sports.com accelerates that goal, providing coverage of the most anticipated events, exclusive content, and insights in the sports world. We are confident in the direction set out by Matthew and his leadership team and look forward to quickly delivering value to the Company’s stakeholders.”

Lottery.com is a leading technology company that is transforming how, where and when lottery is played. Its engaging mobile and online platforms enable players and commercial partners located in the United States and internationally to remotely purchase legally sanctioned lottery games. Fans and subscribers look to Lottery.com for compelling, real-time results on more than 800 lottery games from more than 40 countries. Additionally, through WinTogether.org, Lottery.com is fundamentally changing how non-profit donors are incentivized to action by gamifying charitable giving. In all that it does, Lottery.com’s mission remains the same: an uncompromising passion to innovate, grow a new demographic of enthusiasts, deliver responsible and trusted solutions, and promote community and philanthropic initiatives. For more information, visit http://www.lottery.com.

About Sports.com

Emerging from the strategic acquisition of SportLocker, Sports.com is poised to become the premier destination for sports entertainment, offering an unparalleled array of interactive and engaging sports content. For more information, visit www.sports.com.

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Important Notice Regarding Forward-Looking Statements

This press release contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in this press release, regarding the company’s future financial performance, as well as the company’s strategy, future operations, revenue guidance, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this press release, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Lottery.com disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. Lottery.com cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Lottery.com. In addition, Lottery.com cautions you that the forward-looking statements contained in this press release are subject to the following factors: (i) the outcome of any legal proceedings that may be instituted against Lottery.com; (ii) Lottery.com’s ability to maintain effective internal controls over financial reporting, including the remediation of identified material weaknesses in internal control over financial reporting relating to segregation of duties with respect to, and access controls to, its financial record keeping system, and Lottery.com’s accounting staffing levels; (iii) the effects of competition on Lottery.com’s future business; (iv) risks related to Lottery.com’s dependence on its intellectual property and the risk that Lottery.com’s technology could have undetected defects or errors; (v) changes in applicable laws or regulations; (vi) risks related to the COVID-19 pandemic and its effect directly on Lottery.com and the economy generally; (vii) risks relating to privacy and data protection laws, privacy or data breaches, or the loss of data; (viii) the possibility that Lottery.com may be adversely affected by other economic, business, and/or competitive factors; (ix) the ability of Lottery.com to achieve its strategic and growth objectives as stated or at all; and (x) those factors discussed in the proxy statement/prospectus filed by Lottery.com with the SEC under the heading “Risk Factors” and the other documents filed, or to be filed, by Lottery.com with the SEC. Should one or more of the risks or uncertainties described in this press release materialize or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the reports that Lottery.com has filed and will file from time to time with the SEC. These SEC filings are available publicly on the SEC’s website at www.sec.gov.

CONTACT: Lottery.com Contact: [email protected]

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Nasdaq:LTRY

Lottery.com Inc. Secures Increased Funding From Univest

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Commitment to invest increased from $1 million to $5 million

AUSTIN, Texas, Feb. 09, 2024 (GLOBE NEWSWIRE) — Lottery.com Inc. (Nasdaq: LTRY, LTRYW) (“Lottery.com” or the “Company”), a leading technology company revolutionizing the lottery experience, today announces a substantial expansion in its fundraising efforts.

The Company has amended its placement agent agreement with Univest Securities, LLC (“Univest”), significantly increasing the commitment from new and existing investors. This move underscores the confidence in Lottery.com’s vision and operational strategy, setting a solid foundation for the Company’s growth and expansion.

Under the revised terms of the agreement, the offering amount has been increased from $1,000,000 to $5,000,000 due to strong investor interest. Each unit in the offering consists of a convertible promissory note, paired with a common stock purchase warrant, providing investors with significant opportunities for engagement and investment in Lottery.com’s future.

The committed funds will be used for general working capital; to explore new acquisition opportunities; and to invest in operations which will ensure the normalization of services, expected to recommence this month.

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Matthew McGahan, CEO of Lottery.com, commented:

“We are thrilled with the overwhelming support from our investors, which reflects their confidence in our strategy and our team’s ability to execute it. This increased funding commitment enables us to accelerate our growth plans, further innovate our platform, and continue to redefine the lottery experience worldwide. Our partnership with Univest and our investors is pivotal as we embark on this exciting phase of expansion and innovation.”

Bradley Richmond at Univest added:

“Lottery.com under its current leadership are back on the right track. This is why our investor network has increased its commitment substantially. We look forward to working together to support the Company along its growth journey.”

Lottery.com Contact: [email protected]

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About Lottery.com

Lottery.com is a leading technology company that is transforming how, where and when lottery is played. Its engaging mobile and online platforms enable players and commercial partners located in the United States and internationally to remotely purchase legally sanctioned lottery games. Fans and subscribers look to Lottery.com for compelling, real-time results on more than 800 lottery games from more than 40 countries. Additionally, through WinTogether.org, Lottery.com is fundamentally changing how non-profit donors are incentivized to action by gamifying charitable giving. In all that it does, Lottery.com’s mission remains the same: an uncompromising passion to innovate, grow a new demographic of enthusiasts, deliver responsible and trusted solutions, and promote community and philanthropic initiatives. For more information, visit http://www.lottery.com.

Important Notice Regarding Forward-Looking Statements

This press release contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in this press release, regarding the company’s future financial performance, as well as the company’s strategy, future operations, revenue guidance, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this press release, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Lottery.com disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. Lottery.com cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Lottery.com. In addition, Lottery.com cautions you that the forward-looking statements contained in this press release are subject to the following factors: (i) the outcome of any legal proceedings that may be instituted against Lottery.com; (ii) Lottery.com’s ability to maintain effective internal controls over financial reporting, including the remediation of identified material weaknesses in internal control over financial reporting relating to segregation of duties with respect to, and access controls to, its financial record keeping system, and Lottery.com’s accounting staffing levels; (iii) the effects of competition on Lottery.com’s future business; (iv) risks related to Lottery.com’s dependence on its intellectual property and the risk that Lottery.com’s technology could have undetected defects or errors; (v) changes in applicable laws or regulations; (vi) risks related to the COVID-19 pandemic and its effect directly on Lottery.com and the economy generally; (vii) risks relating to privacy and data protection laws, privacy or data breaches, or the loss of data; (viii) the possibility that Lottery.com may be adversely affected by other economic, business, and/or competitive factors; (ix) the ability of Lottery.com to achieve its strategic and growth objectives as stated or at all; and (x) those factors discussed in the proxy statement/prospectus filed by Lottery.com with the SEC under the heading “Risk Factors” and the other documents filed, or to be filed, by Lottery.com with the SEC. Should one or more of the risks or uncertainties described in this press release materialize or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the reports that Lottery.com has filed and will file from time to time with the SEC. These SEC filings are available publicly on the SEC’s website at www.sec.gov.

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