Statement of Changes in Beneficial Ownership (4)

Date : 08/16/2019 @ 8:08PM
Source : Edgar (US Regulatory)
Stock : AudioEye Inc (AEYE)
Quote : 6.04  1.053 (21.11%) @ 8:57PM

Statement of Changes in Beneficial Ownership (4)

FORM 4
[ ] Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).         
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES
                                                                                  
OMB APPROVAL
OMB Number: 3235-0287
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Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940
                      

1. Name and Address of Reporting Person *

Sero Capital LLC
2. Issuer Name and Ticker or Trading Symbol

AUDIOEYE INC [ AEYE ]
5. Relationship of Reporting Person(s) to Issuer (Check all applicable)

_____ Director                      __ X __ 10% Owner
_____ Officer (give title below)      _____ Other (specify below)
(Last)          (First)          (Middle)

119 WASHINGTON AVE., SUITE 403
3. Date of Earliest Transaction (MM/DD/YYYY)

8/14/2019
(Street)

MIAMI BEACH, FL 33139
(City)        (State)        (Zip)
4. If Amendment, Date Original Filed (MM/DD/YYYY)

 
6. Individual or Joint/Group Filing (Check Applicable Line)

___ Form filed by One Reporting Person
_ X _ Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)
2. Trans. Date 2A. Deemed Execution Date, if any 3. Trans. Code
(Instr. 8)
4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)
5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)
6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4)
Code V Amount (A) or (D) Price
Common Stock   8/14/2019     X (4)    590000   A $1.63   (1) (2) 2246740   I   Through Sero Capital LLC   (3)
Common Stock   8/14/2019     X (4)    295000   A $1.63   (1) (2) 2541740   I   Through Sero Capital LLC   (3)
Common Stock   8/14/2019     X (4)    42858   A $4.07   (1) (2) 2584598   I   Through Sero Capital LLC   (3)
Common Stock                  155169   D   (5)  

Table II - Derivative Securities Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities)
1. Title of Derivate Security
(Instr. 3)
2. Conversion or Exercise Price of Derivative Security 3. Trans. Date 3A. Deemed Execution Date, if any 4. Trans. Code
(Instr. 8)
5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)
6. Date Exercisable and Expiration Date 7. Title and Amount of Securities Underlying Derivative Security
(Instr. 3 and 4)
8. Price of Derivative Security
(Instr. 5)
9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Warrant (right to buy)   $2.50   8/14/2019     J   (1) (2)       590000    11/6/2015   11/6/2020   Common Stock   590000     (1) (2) 0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $1.63   (1) (2) 8/14/2019     J   (1) (2)    590000       11/14/2019   11/6/2020   Common Stock   590000     (1) (2) 590000   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $2.50   8/14/2019     J   (1) (2)       295000    11/17/2017   11/17/2022   Common Stock   295000     (1) (2) 0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $1.63   (1) (2) 8/14/2019     J   (1) (2)    295000       11/14/2019   11/17/2022   Common Stock   295000     (1) (2) 295000   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $6.25   8/14/2019     J   (1) (2)       42858    8/23/2018   9/29/2022   Common Stock   42858     (1) (2) 0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $4.07   (1) (2) 8/14/2019     J   (1) (2)    42858       11/14/2019   9/29/2022   Common Stock   42858     (1) (2) 42858   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $1.63   (1) (2) 8/14/2019     X   (4)       590000    11/14/2019   11/6/2020   Common Stock   590000   $0.00   0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $1.63   (1) (2) 8/14/2019     X   (4)       295000    11/14/2019   11/17/2022   Common Stock   295000   $0.00   0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $4.07   (1) (2) 8/14/2019     X   (4)       42858    11/14/2019   9/29/2022   Common Stock   42858   $0.00   0   I   Through Sero Capital LLC   (3)
Warrant (right to buy)   $6.00   8/14/2019     P   (6) (7)    146667       11/14/2019   8/14/2020   Common Stock   146667     (6) (7) 146667   I   Through Sero Capital LLC   (3)

Explanation of Responses:
(1)  On August 14, 2019, Sero Capital LLC ("Sero Capital") entered into Omnibus Amendments to Common Stock Warrants (the "Amendments") with AudioEye, Inc. (the "Issuer") pursuant to which the exercise prices for several warrants to purchase common stock of the Issuer held by Sero Capital were adjusted. Pursuant to the Amendments, the exercise price for warrants to purchase 590,000 shares of the Issuer's common stock with an expiration date of November 6, 2020 was adjusted to a price of $1.63 per share, if the warrants were exercised on or before August 16, 2019, provided the warrants were exercised in full and the exercise price would be paid in cash, or $2.50, if the warrants were exercised after August 16, 2019.
(2)  (continued from footnote 1) In addition, pursuant to the Amendments, the exercise price of warrants to purchase 295,000 shares of the Issuer's common stock with an expiration date of November 17, 2022 was adjusted to a price of $1.63 per share, if the warrants were exercised on or before August 16, 2019, provided the warrants were exercised in full and the exercise price would be paid in cash, or $2.50, if the warrants were exercised after August 16, 2019. Further, pursuant to the Amendments, the exercise price of warrants to purchase 42,858 shares of the Issuer's common stock with an expiration date of September 29, 2022 was adjusted to a price of $4.07 per share, if the warrants were exercised on or before August 16, 2019, provided the warrants were exercised in full and the exercise price would be paid in cash, or $6.25, if the warrants were exercised after August 16, 2019.
(3)  Securities of the Issuer held directly by Sero Capital. David Moradi is the Managing Partner of Sero Capital and may be deemed to direct all voting and investment decisions made by Sero Capital.
(4)  On August 14, 2019, Sero Capital exercised in full all of the warrants the exercise prices of which were adjusted pursuant to the Amendments.
(5)  Securities of the Issuer held directly by David Moradi.
(6)  On August 14, 2019, Sero Capital entered into a Loan Agreement (the "Loan Agreement") with the Issuer pursuant to which Sero Capital agreed to make advances to the Issuer in an amount up to $2,000,000 in the aggregate during a one-year term at an interest rate of 10% per annum. Interest payments on advances made under the Loan Agreement may be paid by the Issuer in either cash or in Issuer common stock, at the Issuer's option. In the event that the Issuer shall elect to make a payment of interest in the form of Issuer common stock, the number of shares issued by the Issuer with respect to each payment of interest shall be equal to the dollar amount of the applicable interest payment divided by the lesser of (x) $6.07, or (y) the volume weighted average trading price of the common stock for the five trading days immediately preceding the interest payment date.
(7)  (continued from footnote 6) As consideration for entering into the Loan Agreement, on August 14, 2019, the Issuer issued to Sero Capital warrants to purchase 146,667 shares of Issuer common stock at an exercise price of $6.00 per share. Such warrants may be exercised for cash or on a cashless basis, provided that if the fair market value on the expiration date exceeds the exercise price on the expiration date, then the warrants will be deemed to have been exercised in full (to the extent not previously exercised) on a cashless basis on the expiration date. The number of shares purchasable upon the exercise of the warrants and the exercise price are subject to certain antidilution adjustments described in the warrants.

Reporting Owners
Reporting Owner Name / Address
Relationships
Director 10% Owner Officer Other
Sero Capital LLC
119 WASHINGTON AVE., SUITE 403
MIAMI BEACH, FL 33139

X

Moradi David
119 WASHINGTON AVE, SUITE 403
MIAMI BEACH, FL 33139

X


Signatures
SERO CAPITAL LLC, Name: /s/ David Moradi, Title: Managing Partner 8/16/2019
** Signature of Reporting Person Date

/s/ David Moradi 8/16/2019
** Signature of Reporting Person Date


Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

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