SMG Industries Inc. entered into a securities purchase agreement for a private placement to issue 1,500 shares of series C convertible preferred shares at issue price of $10,000 per share for aggregate gross proceeds of $1,500,000 on July 7, 2023. The Series C Preferred Stock is convertible, from time to time at the option of the holder, into a number of shares of Common Stock equal to the quotient of (A) the sum of (x) the Stated Value of such share(s) of Series C Preferred Stock to be converted as of the date of conversion plus any accrued dividends thereon and (B) a conversion price of $0.25 per share of Common Stock.

On the same date, the company received its first tranche. The company issued 500 preferred shares for gross proceeds of $5,000,000 in the tranche. The tranche included participation from Steven H. Madden, chief transition officer and director of the company for $5,000,000. The tranche was approved by the board of directors of the company. The remaining 1,000 Shares may be issued and sold in one or more subsequent closings on or before August 31, 2023.