On February 28, 2018, Protalex, Inc., a Delaware corporation (OTCQB: PRTX) (the “ Company ”), entered into a Securities Purchase Agreement (the “ SPA ”) with each of eight accredited investors raising an aggregate $1.425 million in a private placement financing (the “ Offering ”) of 10% Senior Convertible Notes, due on February 28, 2023 (the “ Senior Notes ”). No commissions were payable in connection with the Offering which was principally sold to existing stockholders of the Company. Proceeds of the Offering will be used for working capital purposes, principally to fund ongoing clinical trials and studies and related activities. No registration rights were granted to the investors in the Offering.

The Senior Notes, which accrue interest at the rate of 10% per annum and are due on February 28, 2023, are convertible at the option of the holder prior to maturity or earlier prepayment. Upon conversion, the note holder will receive 5,000 shares of the Company’s common stock, par value $.00001 per share (“ Common Stock ”) for each $1,000 of principal or accrued interest converted. Two-thirds of the shares issuable upon any conversion of the Senior Notes will be acquired by the Company from Niobe Ventures, LLC (“ Niobe ”), the Company’s principal stockholder, for nominal consideration ($.01 per share) pursuant to a mandatory call agreement entered into in connection with the Offering (the “ Call Agreement ”). As a result, for each $1,000 of principal or interest converted, the Company will issue approximately 1,667 new shares. Accordingly, the effective conversion price for the Company will be approximately $0.60 per share of Common Stock, with Niobe incurring substantially all of the associated dilution. The closing price of per share of Common Stock on the date of the Offering was $0.45.

In addition, as a condition to the consummation of the Offering, on February 28, 2018 the Company and Niobe entered into an Exchange Agreement (the “ Exchange Agreement ”) pursuant to which Niobe converted $22,269,366 of outstanding notes due September 30, 2018 into 18,557,805 shares of Common Stock at a conversion price of $1.20 per share. Consequently, other than the Senior Notes issued in the Offering, the only remaining indebtedness on the Company’s balance sheet at February 28, 2018 is approximately $1,974,350, representing the accrued but unpaid interest on the notes converted by Niobe.

The foregoing purchases of securities were for investment and not with a view for distribution. The securities were issued without registration under the Securities Act of 1933, as amended, pursuant to the exemptions provided under Sections 4(a)(2) and 4(a)(5) thereof. All of the securities issued are restricted securities and bear a restrictive legend and will be subject to stop transfer restrictions.

The foregoing descriptions of the Senior Notes, the SPA, the Call Agreement and Exchange Agreement are qualified in their entirety by the full text of such documents, which are filed as Exhibits 4.1, 10.1, 10.2 and 10.3 hereto, respectively, and incorporated by reference herein. In addition, on March 1, 2018, the Company issued a press release announcing the closing of the Offering which is attached as Exhibit 99.1 hereto.