SRAX, an internet advertising and technology platform company that provides tools to automate the digital advertising market, announced that it entered into a definitive Securities Purchase Agreement with existing investors for the sale of an aggregate of approximately $5.18 million in principal amount of 12.5% Secured Convertible Debentures due on April 21, 2020, and 863,365 Series A Warrants to purchase Class A common stock with a 5 year term. The Company estimates gross proceeds from the offering to be approximately $5.18 million.  The Debentures will be secured, pari passu, with the investors’ prior debentures issued in the company’s April 2017 offering. The Debentures and Warrants are initially convertible and exercisable at $3.00 per share subject to anti-dilution protection as more fully described in a Form 8-K to be filed.

The company expects to use the net proceeds to satisfy an approximate $1.57 million obligation under a warrant issued in October 2014 and for general corporate purposes. After payment of the obligation, the warrant issued in October 2014 will be cancelled.

The transaction is exempt from registration under the Securities Act of 1933, as amended.   Pursuant to a Registration Rights Agreement, the company has agreed to file a registration statement for the shares underlying the Debentures and Warrants within 30 days.

Chardan Capital Markets acted as lead placement agent and Aspenwood Capital as co-agent on this transaction.

The securities offered in the private placement have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or applicable state securities laws. Accordingly, the securities may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws.