SpringBig Holdings, Inc. announced that it has entered into a note purchase agreement to issue 8% Senior Secured Convertible Promissory Notes due 2026 for the gross proceeds of $6,400,000 on January 23, 2024. The transaction will include participation from new individual investors Jeffrey Harris for $320,000, Paul Sykes for $25,000 and Jon Trauben for $15,000. The convertible notes were issued on the closing date and will mature two years after the date of issuance and will be convertible into common stock at the option of the holders at any time prior to the last business day immediately preceding the maturity date at a conversion price of $0.15 per share.

Interest of 8% per annum is payable by adding such interest to the outstanding amount owing under the convertible notes until the earlier of the date of maturity or conversion. The company completed these issuances in a transaction not requiring registration under Section 5 of the Securities Act, in reliance on the exemption afforded by Section 4(a)(2) thereof and/or Rule 506(b) of Regulation D promulgated thereunder. The Convertible Notes and Term Notes will be secured against substantially all the assets of the Company and will rank pari passu with each other.

Each material subsidiary will guarantee the Convertible Notes and Term Notes. The terms of the Purchase Agreement, Convertible Notes contain customary representations and warranties, indemnification, and other covenants of the company and, in the case of the Purchase Agreement, the Purchasers. In addition, under the Purchase Agreement, the company is required to at all times reserve and keep available at all times in favor of each Purchaser a number of shares of Common Stock equal to the 150% of the number of shares issuable upon conversion of the Convertible Notes as of the Closing Date.

The Convertible Notes include customary anti-dilution provisions.