3 E Network closes $1.38M convertible note offering on Nasdaq

3 E Network Technology Group Limited (Nasdaq: MASK) announced the initial closing of a convertible promissory note offering, raising $1,380,000 in gross proceeds from an institutional investor.

The note carries an initial principal amount of $1,500,000 and is convertible into Class A ordinary shares at a par value of $0.0025 per share. The offering also includes a warrant to purchase up to 468,978 Class A ordinary shares at an initial exercise price of $2.712 per share. The warrant expires on June 23, 2031.

The Securities Purchase Agreement also provides for a subsequent closing involving an additional $500,000 in principal in exchange for $460,000 in gross proceeds. That closing is contingent on the effectiveness of a resale registration statement covering the shares underlying the note.

During an event of default under the note, the investor may exercise the warrant at an alternative price equal to 80% of the volume-weighted average price for the trading day immediately preceding the exercise date. Cashless exercise is also permitted under certain conditions when a registration statement is unavailable.

Under a Registration Rights Agreement, the company is required to file a registration statement on Form F-3, or Form F-1 if ineligible for F-3, with the U.S. Securities and Exchange Commission within 15 business days of the closing.

Boustead Securities, LLC acted as placement agent for the offering. The information is based on a press release statement from the Hong Kong-based company.

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