Singing Machine Completes $2.0 Million Private Placement

Two Strategic Partners Invest In an Above-Market Transaction,
Becoming the Second and Third Largest Shareholders.

Fort Lauderdale, FL, Nov. 27, 2023 (GLOBE NEWSWIRE) -- The Singing Machine Company, Inc. (“Singing Machine” or the “Company”) (NASDAQ: MICS) -- the North American leader in consumer karaoke products -- today announced the closing of a $2.0 million private placement of shares of common stock of the Company. The transaction was completed and funded on November 21, 2023, with two existing shareholders that currently have representation on the Company’s Board of Directors.

The transaction was completed at $0.91 per share, representing a 3% premium to the closing price of $0.88 per share on Friday, November 17, 2023. The transaction did not include any warrants or additional rights or obligations of the Company other than demand registration rights in the six months period after closing and the Company taking action to, at a minimum, nominate each of the purchasers or its designee to serve on the Company’s board of directors so long as they own 5% of the Company’s common stock.

The first investor, Stingray Group, Inc. is a pre-existing shareholder that invested $1.0 million, increasing its ownership stake in the Company to approximately 25.6%. The second investor, Regalia Ventures, LLC invested $1.0 million, and is owned and controlled by Jay B. Foreman, also an existing shareholder and director of the Company. As a result of this transaction, Mr. Foreman, through Regalia Ventures, increased his ownership position in the Company to approximately 17.6% and is now the third largest investor in the Company. In total, these two investors now represent a total of 43.2% of the total issued and outstanding shares in the Company’s common stock.

“I am very pleased to announce the closing of this above-market transaction,” commented Gary Atkinson, CEO of the Singing Machine. “Stingray has been a long-standing strategic partner and is closely aligned with our technical and product development team. They play a critical role in delivering our world-class music content library, our subscription based-content offering, and so much more.”

“Stingray has also played an instrumental role in introducing the Company to new and promising potential customers. Specifically, they have made critical introductions in the automotive space, and we are optimistic that these new relationships will play a positive impact on our future financial performance as we continue to expand and enhance our revenue model.”