Stronghold Digital Mining, Inc. that it has entered into securities purchase agreements to issue 2,274,350 class A common shares at a price of $1.60 per share for gross proceeds of $3,638,960, and 2,725,650 pre-funded warrants at a price of $1.60 per pre-funded warrant for gross proceeds of $4,361,040 to new investor Armistice Capital Master Fund Ltd., a fund managed by Armistice Capital, LLC and 602,409 shares of class A common share to Greg Beard at an issue price of $1.66 per share for the gross proceeds of $999,998.94; aggregate gross proceeds of approximately $9,000,000 on September 13, 2022. The company will also issue warrants to purchase 5,000,000 common shares to Armistice Capital Master Fund Ltd., a fund managed by Armistice Capital, LLC and issued warrants to purchase 602,409 common shares to Greg Beard in the transaction, with an initial exercise price of $1.75 per share and such warrants are not exercisable until six months after issuance. The company will be prohibited from issuing equity until 30 days after effectiveness of a registration statement covering the resale of the securities purchased by the institutional investor in the transaction and from effecting variable rate transactions for a period of 6 months following the effective date, in each case subject to certain exceptions.

All the securities issued in the transaction will subject to a lock-up period. The common shares, the warrants and the pre-funded warrants are being sold and issued without registration under the Securities Act of 1933, as amended, in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and Rule 506 of Regulation D promulgated. The transaction is expected to close on September 15, 2022.