Item 1.01 Entry into a Material Definitive Agreement.





Securities Purchase Agreement

On April 10, 2023, AiAdvertising, Inc. (the "Company") entered into a securities purchase agreement (the "Purchase Agreement") with Hexagon Partners, Ltd., (the "Purchaser"), pursuant to which the Company agreed to issue and sell to the Purchaser up to 2,918,560 shares of its Series I Preferred Stock (the "Series I Preferred Stock") for an aggregate purchase price of up to $9,250,000 (the "Purchase Price"), in three tranches. Tranche A comprises 2,272,727 shares of Series I Preferred Stock at a purchase price of $2.20 per share of Series I Preferred Stock purchased at an initial closing on April 11, 2023. The Company also granted the Purchaser a six-month option from the date of the initial closing, which the Purchaser has the right to assign subject to certain restrictions, to purchase (i) up to 333,333 additional shares of Series I Preferred Stock at a purchase price of $6.00 per share of Series I Preferred Stock, and (ii) up to 312,500 shares of Series I Preferred Stock at a purchase price of $7.20 per share of Series I Preferred Stock.

For so long as at least 50% of the Series I Preferred Stock purchased pursuant to the Purchase Agreement have not been redeemed by the Company or converted into common stock of the Company, par value $0.001 per share (the "Common Stock"), Hexagon will have the right to designate two directors to the Company's Board of Directors (the "Board"), and the Company may not increase the size of the Board above six directors without Hexagon's prior written consent. During the same period Hexagon has the right to designate two directors to the Board, Hexagon will have the right to appoint an observer to attend meetings of the Board.

The foregoing summary of the Purchase Agreement is qualified in its entirety by reference to the Purchase Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K, and is incorporated herein by reference.

Series I Certificate of Designation

Pursuant to the Purchase Agreement, on April 10, 2023, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series I Preferred Stock (the "Series I Certificate") with the Nevada Secretary of State designating the rights, preferences and limitations of the Series I Preferred Stock. Each share of Series I Preferred Stock is convertible at the option of the holder at any time and from time to time into four hundred (400) fully-paid and non-assessable shares of Common Stock, subject to customary adjustments for stock splits, stock dividends, stock combination recapitalizations or other similar transactions (the "Conversion Ratio"). The holders of outstanding shares of the Series I Preferred Stock shall be entitled to receive dividends pari passu with the holders of Common Stock (except for stock dividends for which adjustments are made pursuant to the Series I Certificate or upon a liquidation, dissolution and winding up of the Company where the holders of Series I Preferred Stock have received payment to the Series I Certificate). The holders of Series I Preferred Stock are entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series I Preferred Stock held by such holder are then convertible based on the Conversion Ratio as of the record date for determining stockholders entitled to vote (i) on all matters presented to the holders of Common Stock for approval, voting together with the holders of Common Stock as one class, or (ii) whenever the approval or other action of the holders of Series I Preferred Stock is required by applicable law or by the Company's articles of incorporation, bylaws, or other organizational documents; provided, however that the holders of Series I Preferred Stock shall not be entitled to vote together with the Common Stock with respect to any matter at a meeting of the stockholders of the Company, which under applicable law or the Company's articles of incorporation, bylaws or other organizational documents requires a separate class vote. . . .

Item 3.02. Unregistered Sales of Equity Securities.

The information provided in Item 1.01 Entry into a Material Definitive Agreement of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.

The Purchaser represented to the Company in the Purchase Agreement that at the time the Purchaser was offered the Series I Preferred Stock, it was, and on each date on which any shares of Series I Preferred Stock are converted into Common Stock, it will be either: (i) an "accredited investor" as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act of 1933, as amended (the "Securities Act") or (ii) a "qualified institutional buyer" as defined in Rule 144A(a) under the Securities Act, and the Company relied on such representations.

The transaction described in Item 1.01 herein between the Company and the Purchaser was made in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act. The transaction was not conducted in connection with a public offering and the participants in the transaction did not rely on, and the Company did not make, any public solicitation or advertisement in connection with the transactions.

This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall such securities be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

Item 3.03. Material Modification to Rights of Security Holders

The information provided in Item 1.01 Entry into a Material Definitive Agreement and Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.

Item 5.01 Changes in Control of Registrant

The information provided in Item 1.01 Entry into a Material Definitive Agreement of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.

Upon closing of the transactions contemplated by the Purchase Agreement, the Purchaser will beneficially own approximately 40.6% of the Company's outstanding Common Stock.

Calculations of the percentage of the shares of Common Stock beneficially owned assume that there are 1,330,477,660 shares of Common Stock, plus (ii) 909,090,800 shares of Common Stock issuable upon conversion of the 2,272,727 shares of Series I Preferred Stock.

All shares of Series I Preferred Stock were purchased using partnership funds of the Purchaser.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

The information provided in Item 1.01 Entry into a Material Definitive Agreement of this Current Report on Form 8-K with respect to the Series I Certificate is incorporated by reference into this Item 5.03.





Amended and Restated Bylaws

In accordance with terms of the Purchase Agreement, on April 10, 2023, the Board amended and restated the Company's bylaws to, among other things, (i) set the size of the Board at six directors, (ii) provide that the size of the Board shall not be increased without the affirmative vote of the holders of the Company's voting securities holding 80% of the vote, (iii) revise the provisions relating to indemnification of certain persons, and (iv) provide that the Board may not amend the bylaws without the affirmative vote of 75% of the members of the Board (the "Amended and Restated Bylaws").

The foregoing summary of the Amended and Restated Bylaws is qualified in its entirety by the Amended and Restated Bylaws, which is attached hereto as Exhibit 3.2, and is incorporated herein by reference.





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Item 7.01 Regulation FD Disclosure.

On April 11, 2023, the Company issued a press release announcing the foregoing transactions. A copy of the press release is attached as Exhibit 99.1 and incorporated herein by reference.

The information furnished pursuant to Item 7.01, including Exhibit 99.1, shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended ("Exchange Act") or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing made by us under the Exchange Act or Securities Act, regardless of any general incorporation language in any such filing, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.





Exhibit No.   Exhibit
3.1             Certificate of Designation, Preferences, Rights and Limitations of
              Series I Preferred Stock

3.2             Amended and Restated Bylaws of AiAdvertising, Inc.

10.1            Securities Purchase Agreement dated April 10, 2023 between
              AiAdvertising, Inc. and Hexagon Partners, Ltd.

10.2            Registration Rights and Lock-Up Agreement dated April 11, 2023 between
              AiAdvertising, Inc. and Hexagon Partners, Ltd.

99.1            Press Release issued April 11, 2023

104           Cover Page Interactive Data File (embedded within the Inline XBRL
              document)




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