VANCOUVER, BC, June 23, 2026 /CNW/ - East Side Games Group Inc. (TSX: EAGR) (OTC: EAGRF) ("ESGG" or the "Company") and Truly Social Games, LLC ("TSG") today jointly announced that they have reached a settlement resolving all claims and counterclaims between the parties, including those arising from the Membership Interest Purchase Agreement dated June 16, 2021 and related litigation (the "Settlement")

Under the terms of the Settlement, ESGG will pay TSG a total of CAD $3,000,000 CAD in cash, $1,000,000 of which will be payable within thirty days of the Settlement date, and the remaining balance will be payable by way of four equal payments over the course of two years.               

As part of the Settlement, ESGG will also issue to TSG 3M warrants. Each warrant is exercisable into common shares of ESGG at a price of $0.14 per share, expiring November 24, 2028, and will contain standard adjustment provisions in the event of any changes to the ESGG's capital structure (e.g., share consolidations, share splits). The exercise price represents a premium of 55.6% to the market price of ESGG's common shares on the TSX as at May 23, 2026 (being $0.09/share), when the Settlement terms were confirmed. The warrants and the underlying shares will be subject to a statutory four month hold period. As at the date of this news release, the shares underlying the warrants are equivalent to 3.90% of the issued and outstanding common shares of ESGG. TSG does not currently hold any common shares of ESGG.  As such, it is not expected that the issuance of the warrants, nor the Settlement terms as a whole, will have any material effect on the control of ESGG.

As the TSX does not generally allow for the issuance of warrants on their own, Section 607 of the TSX Company Manual requires prior shareholder approval in such instances.  ESGG has obtained written consent from Jason Bailey, ESGG's CEO and a director, as well as Derek Lew, a director, in support of the warrant issuance and the settlement terms.  Collectively, Messrs. Bailey and Lew hold more than 50% of ESGG's outstanding common shares as at the date of this press release.  ESGG anticipates that the warrants will be issued on or before June 30, 2026, subject to acceptance by the TSX.

ESGG has also agreed under the Settlement to enter into a royalty agreement with TSG with respect to one of ESGG's games (the "Game"), pursuant to which ESGG will pay TSG a royalty of 8% of the gross revenues generated by the Game (subject to a cap of $15 million) and to sell its equity interests in TSG back to TSG for a nominal amount. Jim MacCallum shall also resign as a director of TSG LLC.

The trial set to commence on May 25, 2026, was adjourned generally, and a consent dismissal order will be entered when all of the terms of the settlement are fulfilled.

"We are pleased to have reached a mutually acceptable resolution and to put this matter behind us," said Jason Bailey, Executive Chairman and Chief Executive Officer of East Side Games Group. "ESGG remains focused on its mission of building engaging mobile games and supporting its development partners and players around the world."

"Truly Social Games is satisfied with the resolution of this matter and appreciates the constructive dialogue that led to today's announcement," said Cooper DuBois, founder of Truly Social Games. "We look forward to focusing on our future projects and the talented team behind them."

ABOUT EAST SIDE GAMES GROUP

ESGG is a leader in free-to-play mobile gaming, thrilling players with unforgettable experiences that spark lifelong fandom. Fueled by an entrepreneurial spirit, we are driven by creativity, flawless execution, and a laser-focused strategy. We develop and publish both original and licensed IP titles, license our cutting-edge GameKit(s) platforms, and strategically acquire studios or games to expand our family.

Headquartered in Vancouver with around 100 talent-dense team members, we operate over a dozen titles under East Side Games ("ESG") and LDRLY (Technologies) Inc. ("LDRLY"). Together, we're crafting, launching, and publishing mobile games across our own studios and an extended Game Kit partner network, reaching players on iOS and Android worldwide.

We power our success through in-app purchases ("IAP") — offering exclusive, game-enhancing virtual items — and in-game advertising. To keep growing, we focus on captivating audiences, keeping them engaged, and unlocking exciting new ways to monetize. We'll drive this momentum by launching bold new titles, enriching our current lineup, innovating discovery, expanding into fresh markets, and exploring new distribution platforms.

Additional information about the Company continues to be available under its legal name, East Side Games Group Inc., at www.sedarplus.ca

ABOUT TRULY SOCIAL GAMES, LLC

Truly Social Games is a Portland, Oregon-based mobile game developer focused on the design and production of free-to-play games for a global audience.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking information and forward-looking statements within the meaning of applicable Canadian securities laws. Forward-looking information in this press release includes, but is not limited to, statements regarding the actions and steps that will be taken by the Company in furtherance of the Settlement.

Forward-looking information is based on the Company's current expectations, estimates, projections, and assumptions as of the date of this press release. Forward-looking information is subject to known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to differ materially from those expressed or implied by such forward-looking information. These risks and uncertainties include, among others, risks related to the  Company's ability to repay the amounts owing pursuant to the Settlement and to execute its strategic plan, repay or restructure indebtedness, improve operating performance, maintain adequate working capital, and comply with applicable regulatory and stock exchange requirements.

Readers are cautioned not to place undue reliance on forward-looking information. Except as required by applicable law, the Company undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

Forward-looking statements are based on the current expectations of management and involve known and unknown risks and uncertainties that may cause actual results to differ materially. The Company does not assume any obligation to update these forward-looking statements except as required by law.

SOURCE East Side Games Group Inc.