Grom Social Enterprises, Inc. Announces Pricing of $3.0 Million Private Placement Priced At-the-Market Per Nasdaq Rules

BOCA RATON, Fla., Jan. 25, 2023 (GLOBE NEWSWIRE) — Grom Social Enterprises, Inc. (NASDAQ: GROM; GROMW) (“Grom” or the “Company”), a media, technology and entertainment company dedicated to family-friendly programming, web filtering technology and safe social media for kids, today announced that it has entered into a securities purchase agreement with a single institutional investor to raise gross proceeds of approximately $3.0 million through the private placement of 1,327,434 shares of common stock (or pre-funded warrants in lieu thereof), and warrants to purchase 2,323,010 shares of common stock. Each share of common stock (or pre-funded warrant in lieu thereof) is being sold together with accompanying warrants at a combined effective purchase price of $2.26 priced at-the-market under Nasdaq rules. The pre-funded units will be sold at the same price less the pre-funded warrant exercise price of $0.01. The warrants will be immediately exercisable from the date of issuance at an initial exercise price of $2.26 per share, subject to adjustments as set forth therein, and will expire five years from the date of issuance. The closing of the private placement is expected to occur on January 27, 2023, subject to the satisfaction of certain customary closing conditions set forth in the securities purchase agreement.

The Company intends to use the net proceeds from the private placement for general working capital and administrative purposes.

EF Hutton, division of Benchmark Investments, LLC, is acting as exclusive placement agent for the offering.

The shares of common stock, pre-funded warrants, and warrants described above have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (the “SEC”) or an applicable exemption from such registration requirements. The securities were offered only to accredited investors. Pursuant to a registration rights agreement with the investors, the Company has agreed to file one or more registration statements with the SEC covering the resale of the shares of common stock and the shares issuable upon exercise of the pre-funded warrants and warrants.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, 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.

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