PITTSBURGH, March 5 — Smith Micro Software, Inc. (the “Company” or “Smith Micro”) (NASDAQ: SMSI) today announced that it has entered into a securities purchase agreement for the sale of securities to accredited investors pursuant to an unregistered offering, the gross proceeds of which are expected to be approximately $4.9 million, which includes committed investments of approximately $4.6 million from a trust for which Bill Smith, the Company’s chief executive officer and founder, serves as co-trustee, and approximately $90 thousand from Tim Huffmyer, the Company’s chief operating officer and chief financial officer.
The agreement provides for the issuance of secured convertible notes with an aggregate original principal amount of approximately $4.9 million and an initial conversion price of $0.68 per share, subject to adjustment, and warrants to acquire up to an aggregate amount of approximately 9.4 million additional shares of the Company’s common stock in a private placement. Each warrant will be exercisable for one share of common stock at a price of $0.68 per share. The warrants will become exercisable at any time beginning six months after they are issued and will expire five years thereafter.
In connection with the issuance of the secured convertible notes, the Company has agreed to repay in full the principal and interest outstanding under certain notes due March 31, 2026 in the aggregate amount of up to $2.2 million, plus any additional interest amounts that may accrue in connection with an extension of the maturity date thereunder. Certain of the holders of these notes have agreed to reinvest an aggregate of $0.9 million of this repayment in the offering, which reinvestment is included in the overall gross proceeds.
The offering is expected to close on or about March 6, 2026, subject to customary closing conditions.
Smith Micro expects to use the net proceeds from the offering for repayment of the notes due March 31, 2026 as well as for general corporate purposes.
Buchanan Ingersoll & Rooney PC served as legal counsel to the Company for the offering.
The secured convertible notes and the warrants for the offering were offered and are being sold in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D of the Securities Act and in reliance on similar exemptions under applicable state laws. Accordingly, the privately placed secured convertible notes, warrants and underlying shares of common stock issuable upon conversion of the secured convertible notes or exercise of the warrants issued in the offering 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. The Company has agreed to file a registration statement with the SEC registering the resale of the shares of common stock issuable upon conversion of the secured convertible notes and upon exercise of the warrants issued in connection with the offering.
This press release is not an offer to sell, or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.