LOS ANGELES, April 21, 2017 /PRNewswire/ -- SRAX
(Nasdaq: SRAX), an Internet advertising and technology
platform company that provides tools to automate the digital
advertising market, announced it entered into a definitive
securities purchase agreement with certain institutional and
accredited investors for the purchase and sale of up to an
aggregate of $3.72 million principal
amount Secured Convertible Debentures and five year Series A
Warrants representing the right to acquire up
to 1,156,667 shares of Class A common stock in a
transaction exempt from registration under the Securities Act of
1933, as amended. The Debentures are secured by a second
position security interest in the Company's accounts receivable and
a first position security interest in the balance of its assets,
and the Company is subject to continued compliance with certain
financial covenants. The Debenture and Warrants are initially
exercisable at $3.00 per share.
"This capital infusion satisfies certain current obligations,
eliminates uncertainty of the variable priced financial instrument
and provides us working capital to continue to grow the business,"
stated Christopher Miglino, Chief
Executive Officer of SRAX. "We believe we are now on more solid
financial footing and continue to focus on serving our customers
with the most effective platform offerings for their marketing
needs."
SRAX expects to use the net proceeds to satisfy a $2.5 million put obligation under Series B
Warrants issued to investors in a registered direct offering the
Company conducted in January 2017 and
to satisfy other current obligations and for working capital.
After payment of the put obligation the Series B Warrants will be
terminated and no longer outstanding.
The Company estimates net proceeds from the offering to be
approximately $3.5 million after
deducting placement agent fees, legal fees and other estimated
offering expenses. The Debentures will bear interest at a rate
of 12.5% per year, payable quarterly. The Debentures will
mature on April 21, 2020, unless earlier redeemed or
converted. The Debentures are convertible at the option of the
holder into shares of the Company's Class A common stock at an
initial conversion price of $3.00 per
share, subject to adjustment.
Chardan Capital, LLC and Noble Capital Markets, Inc. acted as
co-placement agents for this offering.
This news 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 jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.
About SRAX
SRAX (NASDAQ: SRAX) is an advertising technology company
providing the tools to automate digital marketers and content
owners' campaigns across digital channels. SRAX's tools amplify
performance and maximize profits for brands in the healthcare, CPG,
automotive, wellness and lifestyle verticals through an omnichannel
approach that integrates all aspects of the marketing experience
into one platform. The company's machine-learning technology
identifies brands' core consumers and their characteristics
discovering new and measurable opportunities to target, reach and
monetize audiences driving online and offline sales lift. For more
information on how SRAX delivers a digital competitive advantage to
surpass today's marketing challenges, visit www.srax.com.
Safe Harbor Statement
This press release contains certain forward-looking statements that
are based upon current expectations and involve certain risks and
uncertainties within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. Words or expressions such as
"anticipate," "plan," "will," "intend," "believe" or "expect'" or
variations of such words and similar expressions are intended to
identify such forward-looking statements. These forward-looking
statements are not guarantees of future performance and are subject
to risks, uncertainties, and other factors, some of which are
beyond our control and difficult to predict and could cause actual
results to differ materially from those expressed or forecasted in
the forward-looking statements, including, without limitation,
statements made with respect to expectations of our ability to
increase our revenues, satisfy our obligations as they become due,
report profitable operations and other risks and uncertainties, all
as set forth in our Annual Report on Form 10-K for the year ended
December 31, 2016, as filed with the
Securities and Exchange Commission. All forward-looking statements
involve significant risks and uncertainties that could cause actual
results to differ materially from those in the forward-looking
statements, many of which are generally outside the control of
Social Reality and are difficult to predict. Social Reality
undertakes no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
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SOURCE SRAX