Marpai, Inc. Announces $12.1M Private Placement of Series A Preferred

What Happened
Marpai, Inc. announced on July 29, 2026 that it entered into securities purchase agreements to sell an aggregate of 12,100 newly designated Series A Preferred Stock at $1,000 per share, for expected gross proceeds of approximately $12,100,000. The initial closing was expected on or about July 31, 2026, and the Company filed the Certificate of Designation for the Series A Preferred on July 31, 2026. The Preferred shares are convertible into Common Stock (conversion formula: $1,000 stated value ÷ $1.00 conversion price, subject to adjustments and certain beneficial ownership limits) and contain automatic conversion triggers, dividend, voting and liquidation features as described below. The Offering was led by the Mitchell Family Trust II, and a board observer agreement names Steve Mitchell as a board observer.

Key Details

• Offering size: 12,100 shares of Series A Preferred at $1,000 each; aggregate gross proceeds expected ≈ $12,100,000. Initial closing on or about July 31, 2026.
• Conversion: Each Preferred share converts at holder’s option into Common Stock equal to $1,000 ÷ $1.00 conversion price (subject to adjustments and beneficial ownership limits); automatic conversion on a qualified public offering or 60% vote of Preferred holders.
• Economic and voting rights: 8% dividend payable in Common Stock upon liquidity or conversion; Preferred votes with Common Stock on an as-converted basis; liquidation payments pari passu with any parity securities after senior claims.
• Governance & investor protections: Board observer (Steve Mitchell) for two years if lead investor retains ≥3,000 Preferred shares; purchasers holding ≥50 Preferred shares have 24 months’ participation rights in future equity offerings; certain purchasers receive information rights if they continue to hold Preferred equal to 10% of issued and outstanding Common; most-favored nation (MFN) protection subject to conditions and expiration triggers.
• Registration & resale limitations: Company agreed to file a registration statement within 60 days of closing and use commercially reasonable efforts to have it effective within 90 days; the securities were sold in a private placement exempt from registration (Section 4(a)(2) and/or Rule 506(b)) and are restricted from resale without registration or an exemption.

Why It Matters
This transaction provides Marpai with immediate capital (≈$12.1M) to support operations or growth initiatives, while creating a new class of convertible preferred stock that can convert into a significant number of common shares (subject to limits and automatic conversion triggers). For existing and prospective investors, the key implications are potential dilution if Preferred converts, new investor rights (observer seat, information and participation rights), and timing/conditions for resale of these securities. The filing contains the detailed terms (Certificate of Designation and Purchase Agreements) that govern conversion, voting, dividends and liquidation priority.