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SRAX Announces Non-Reliance on Previously Issued Financial Statements

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Social Reality, Inc. (NASDAQ: SRAX), a digital marketing and consumer data management technology company, today announced that on April 7, 2019, management of Social Reality, Inc. (the “Company”) concluded and the audit committee of the Company has concurred that the Company’s previously issued quarterly and year-to-date unaudited consolidated financial statements for March 31, 2017June 30, 2017September 30, 2017December 31, 2017March 31, 2018June 30, 2018 and September 30, 2018 and that its audited consolidated financial statements for the year ending December 31, 2017 should no longer be relied upon. Similarly, related press releases, earnings releases, and investor communications describing the Company’s financial statements for these periods should no longer be relied upon. The errors identified are all non-cash and primarily related to the Company’s classification of certain outstanding warrants with provisions that allow the warrant holder to force cash redemption under certain circumstances.

Based on its preliminary assessment, the Company is providing the following estimates regarding the aggregate impact of these errors on consolidated total current liabilities, total liabilities, equity, other income, net income (loss) and income (loss) per share, calculated in accordance with accounting principles generally accepted in the U.S., for each of the periods presented:

SOCIAL REALITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

NINE MONTH PERIOD ENDED SEPTEMBER 30, 2018

(Unaudited)

AS 
REPORTED

Restated

YTD 
September

YTD 
September

2018

Adjustments

2018

Revenues 

$                8,823,592

$        8,823,592

Cost of revenue

2,902,179

2,902,179

Gross profit 

$                 5,921,413

$        5,921,413

Loss from operations 

$               (8,492,866)

$       (8,492,866)

Other income (expense) 

Total interest expense

$               (2,772,448)

$       (2,772,448)

Loss on repricing of Series A warrants 

$                               –

$                   –

Accretion of put warrants

$            800,000

$           800,000

Accretion of debenture warrants 

$            800,000

$           800,000

Accretion of Leapfrog warrants

$            600,000

$           600,000

    Loss (Gain) on Sale of Fixed Assets 

$             23,978,389

$      23,978,389

Other Income

$             21,210,439

$         2,200,000

$      23,410,439

Net Income (loss)

$             12,717,573

$         2,200,000

$      14,917,573

Net (loss) income pershare, basic 

$                        1.59

$                1.86

Net (loss) income pershare, diluted 

$                        1.59

$                1.86

Weighted average shares outstanding, basic 

8,008,717

8,008,717

Weighted average shares outstanding, diluted 

8,008,717

8,008,717

SOCIAL REALITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2017

AS 
REPORTED

Restated

Full Year

Full Year

2017

Adjustments

2017

Revenues 

$              23,348,714

$      23,348,714

Cost of revenue

9,328,893

9,328,893

Gross profit 

$              14,019,821

$      14,019,821

Loss from operations 

$               (3,843,679)

$       (3,843,679)

Other income (expense) 

      Total interest expense

$               (2,815,203)

$       (2,815,203)

Loss on repricing of Series A warrants 

$                           –

$           (100,000)

$          (100,000)

Accretion of put warrants

$            500,000

$           500,000

Accretion of debenture warrants 

$           (700,000)

$          (700,000)

Accretion of Leapfrog warrants

$        (1,500,000)

$       (1,500,000)

    Loss (Gain) on Sale of Fixed Assets 

$                           –

$                   –

Other Income

$               (2,815,203)

$        (1,800,000)

$       (4,615,203)

Net Income (loss)

$               (6,658,882)

$        (1,800,000)

$       (8,458,882)

Net (loss) income pershare, basic 

$                       (0.81)

$               (1.02)

Weighted average shares outstanding, basic 

8,253,851

8,253,851

SOCIAL REALITY, INC.

CONDENSED AND CONSOLIDATED BALANCE SHEET

SEPTEMBER 30, 2018

(Unaudited)

September 30

September 30

2018

2018

As Reported

Adjustments

As Restated

Total assets

34,341,324

34,341,324

Liabilities and stockholders’ equity

Current liabilities:

   Accounts payable and accrued expenses

2,475,229

2,475,229

    Leapfrog warrant liability

1,000,000

1,000,000

   Warrant liability – Series A

1,300,000

1,300,000

    Debenture warrant liability

1,600,000

1,600,000

     Total current liabilities

2,475,229

3,900,000

6,375,229

Secured convertible debentures, net

2,943,109

2,943,109

      Total liabilities

5,418,338

3,900,000

9,318,338

Total stockholders’ equity 

28,922,886

(3,900,000)

25,022,886

Total liabilities and stockholders’ equity

34,341,224

34,341,224

SOCIAL REALITY, INC.

CONDENSED AND CONSOLIDATED BALANCE SHEET

DECEMBER 31, 2017

Restated

December 31,

December

2017

Adjustments

2017

 Total assets

23,605,699

23,605,699

Liabilities and stockholders’ equity

Current liabilities:

   Accounts payable and accrued expenses

5,010,815

5,010,815

    Leapfrog warrant liability

1,700,000

1,700,000

   Warrant liability – Series A

2,100,000

2,100,000

    Debenture warrant liability

2,500,000

2,500,000

     Total current liabilities

5,010,815

6,300,000

11,310,815

Secured convertible debentures, net

1,711,146

1,711,146

      Total liabilities

6,721,961

6,300,000

13,021,961

Total stockholders’ equity 

16,883,738

(6,300,000)

10,583,738

Total liabilities and stockholders’ equity

23,605,699

23,605,699

Since the Company has not yet fully completed its review, the estimates regarding the impact set forth above are preliminary and remain subject to change.

In connection with the restatement, management has determined that a material weakness related to the accounting for financing transactions in the Company’s internal control over financial reporting existed for the periods from March 31, 2017 through December 31, 2018. The Company’s chief executive officer and chief financial officer have concluded that the Company’s disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2017 through December 31, 2018, and the Company’s management has concluded that its internal control over financial reporting was not effective as of December 31, 2018.

The Company anticipates that it will file amended Quarterly Reports on Form 10-Q for the periods ended March 31, 2018June 30, 2018 and September 30, 2018, to amend and restate its financial condition and financial results for the affected periods as soon as practicable.

About SRAX

Social Reality, Inc. (NASDAQ: SRAX) is a digital marketing and consumer data management technology company. SRAX’s technology delivers the tools to unlock data to reveal brands core consumers and their characteristics across marketing channels. Through its blockchain identification graph technology platform, BIGtoken, SRAX has developed a consumer-managed data marketplace where people can own and earn from their data thereby providing everyone in the Internet ecosystem choice, transparency, and compensation. SRAX’s technology and tools deliver a digital competitive advantage for brands in the CPG, automotive, investor relations and lifestyle verticals by integrating all aspects of the advertising experience, including verified consumer participation, into one platform. For more information on SRAX, visit www.srax.com.

 

SOURCE SRAX

Blockchain

Earn.re Welcomes Pinnacle Storage Properties as Project Sponsor

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Earn.re, the blockchain-based commercial real estate (CRE) financing platform, today announced that Pinnacle Storage Properties LLC has become a project sponsor and early adopter of its technology. As a project sponsor, Pinnacle Storage Properties intends to list more than $100 million of self-storage projects on the Earn.re platform over the course of 12 months commencing in late 2019.

Based in Katy, Texas, Pinnacle Storage Properties is a privately held national acquirer, developer, owner and operator of self-storage facilities with a portfolio of 20 properties totaling more than 1 million square feet of rentable self-storage space.

“We’re pleased to have secured the commitment of an experienced sponsor with a strong track record of success and increasing momentum,” said Aaron Lohmann, CEO, Earn.re. “By becoming an early adopter of Earn.re, Pinnacle Storage Properties will enjoy enhanced transactional certainty, speed, liquidity and transparency when financing projects in the future.”

“We recognize the potential of Earn.re to become a major disruptive force by bringing liquidity to what is traditionally an illiquid asset class. Self-storage investors typically wait a long time to see a return, and sponsors have to deal with compliance challenges along the way,” said John Manes, CEO, Pinnacle Storage Properties. “The ability to trade CRE security tokens like stocks or bonds will add flexibility and speed to an industry that has historically moved pretty slowly in terms of completing transactions.”

Designed to connect lenders and accredited investors directly with project sponsors, Earn.re is building a platform that offers debt and equity investment opportunities to Earn.re participants. Earn.re generates a security token—a virtual contract—that represents a fractional ownership stake in a debt or equity instrument verified within the blockchain. Each token is programmed to automatically compute and distribute returns to investors’ private crypto wallets.

Once created, Earn Debt and Earn Equity tokens can be traded on the Earn.re exchange, just as stocks and bonds are traded, in one of the CRE industry’s first digital secondary markets for debt and equity securities. Through the exchange, Earn.re will bring liquidity to CRE financing in compliance with regulatory requirements.

The Earn.re platform is built on the Ethereum public blockchain and provides users with a secure means of investing in U.S. CRE with full transparency and in compliance with U.S. securities and data privacy laws. It will offer debt and equity securities backed by nearly every property type, including retail, multi-family, self-storage, hospitality, industrial and government. Through Earn.re security tokens, investment documents such as deeds, mortgages, notes, shareholder agreements and more are attached digitally to the blockchain.

 

SOURCE Earn.re

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Artprice: The “Toulouse Caravaggio” Acquired Privately

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The public sale was scheduled for Thursday, 27 June at 18:00, Toulouse time. According to the Sale Conditions, anyone interested in acquiring the painting had to “register as a bidder at least 15 days before the sale.” As thierry Ehrmann explains, that meant that since 13 June at the very least, all the potential bidders were known to the sellers. And, as Julius Caesar would have said… the die is now thrown. 

Because… no less than 48 hours before the public sale was due to take place, the sale has been cancelled! A private transaction has been concluded. “An offer that we had no choice but to communicate to the owners of the painting,” says the official statement which provides a very concise explanation: “The fact that the offer comes from a collector with close connections to a major museum convinced the sellers to accept it.

This is undoubtedly a very happy ending for everyone involved, not to mention the sellers the art expert who discovered the work, Eric Turquin, and auctioneer Marc Labarbe. The undisclosed amount apparently readily confirms that the work is indeed an authentic Caravaggio, and the buyer, anonymous, but close enough to the world’s most prestigious museums, is apparently committed to ensuring painting will very soon be exhibited in one of the planet’s top museums. It could be any museum in the world… except the Louvre, which turned its back on the painting… “An attitude that, for me personally, was difficult to digest,” confessed Eric Turquin to the French magazine Le Point. The official statement says: “Purchased by a foreign collector, [the painting] will leave France.” Its ultimate destination was the sellers’ second biggest concern, after its sale price of course… Otherwise a deal would certainly have been struck directly with a major museum.

From the sellers’ point of view, this is the best possible outcome. In terms of transparency, it’s a total and singular reversal of the situation. The sellers promised a “authentic” public sale, i.e. a sale that was 100% public, with no reserve price and broadcast live on internet so that everyone and anyone could participate in the auction. The final price was going to allow the Market to decide on the painting’s authenticity… but the curtain has fallen even before it went up… and the amount of the transaction will remain forever confidential.

Last Monday, on 17 June, Sotheby’s announced its withdrawal from the public sphere. A week later, the most anticipated work of the year has suddenly done more or less the same. For Artprice, the two cases strongly suggest that the Art Market is seeking a certain discretion. In the sales catalogue, Eric Turquin thanked his collaborators: “I wish to thank my expert colleagues, the restorers, the framers, the bankers, the insurers, the photographers and the transporters, etc. who have scrupulously respected their professional confidentiality obligations and allowed us to work in a calm and collected manner.”

After five years of work, research and determination, “this painting will go to one of the best museums in the world. And for me that was essential,” concludes Eric Turquin.

Given the importance of this work in art historical terms, Artprice promises to track the reappearance of this painting – a painting that, as of today, no longer needs to be referred to as the “The Toulouse Caravaggio” –  and to shed as much light as possible on this private sale, concluded just hours before an auction that had all the makings of a truly historic event. Artprice’s consistent and long-standing efforts to bring transparency to the Art Market are more than ever justified.

 

SOURCE Artprice.com

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Huobi Expands to Turkey

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As part of its ongoing plans for global expansion, Huobi Group will be moving aggressively into the Turkish market over the course of the next 12 months. Plans include a fiat onramp for Turkish Lira, a branch office with local resources in Turkey, and localized products and customer services.  Huobi invites Turkish projects to apply for listing here: list@huobi.com.

Turkey is a very important and promising prospective market for us and we plan to take an aggressive approach to bring the Huobi ecosystem there,” said Huobi Global CEO Livio Weng, fresh off a Huobi-sponsored meetup in Istanbul.  The event was attended by traders, crypto enthusiasts, and blockchain professionals, including digital economy expert Erkan Öz and lecturer and cryptocurrency mentor Ismail Hakki Polat.

Huobi’s expansion into Turkey will be overseen by Huobi MENA, the Middle EastAfrica, and South Asia branch of Huobi Group. Huobi MENA is headquartered in Dubai.

“We are really excited with the response we received from the Turkish community. With their support, we successfully pulled off one of the largest crypto events in Turkey. We’ve already added a Turkish language option to the Huobi Global website and will also be rolling out Turkish language customer support and a Turkish language mobile app. Other than this, we’ve also launched Huobi Tokens for the Turkish users, which gives them access to Huobi Prime and Fast Track. We also hope to have a crypto-to-fiat onramp for Turkish users by the end of the year.” said Mohit Davar, Co-Founder of Huobi MENA.

According to market research and analysis firm Statistica’s  Global Consumer Survey for 2019, Turkish citizens already have the highest per-capital rate of cryptocurrency ownership of all nations surveyed. A whopping 20% – or 1 in 5 – Turkish residents now own some form of cryptocurrency. “That figure definitely matches what we’ve experienced during our time here,” Weng said. “We’ve been blown away by the numbers and passion of the Turkish trading community.”

In addition to Turkey, Huobi is exploring an expanded role in other markets as well. This includes Romania, where, at the invitation of the Romanian government, Weng recently delivered a keynote speech in Bucharest’s Palace of the Parliament as part of the 2019 Romania Blockchain Summit.

“It’s unclear what changes blockchain will bring to the world but today we are all pioneers in the space,” said Weng.  “Huobi is willing to work with you in charting a path into a promising future.”

 

SOURCE Huobi Global

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