WeTrade Group a global diversified “software as a service” (“SaaS”) technology service provider committed to providing technical support and digital transformation tools for enterprises across multiple industries, announced that it has entered into those certain securities purchase agreements with certain accredited investors for the sale and issuance of a new series of senior secured convertible notes in the original principal amount of $18,333,333.33 (the “Notes”) and common stock purchase warrants to purchase up to 25% of the shares of common stock underlying the Notes (the “Warrants”) at initial exercise of $1.00 per share, subject to adjustment, subject to customary closing conditions. The net proceeds, after original issue discount will total $16.5 million. The transaction has not been closed as of the date hereof.
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Provided no Event of Default (as defined in the Notes) has occurred, the Notes will accrue interest at an interest rate of 5% per annum, and the Company will be required to pay installment amounts, or at its option redeem such amounts under the Notes each month commencing on the last trading day of the calendar month in which the control account trigger date occurs, and thereafter, the last trading day of each calendar month until the maturity date of eighteen months from issuance, at which time all outstanding amounts remaining, if any, will be due and payable in full.
At the Company’s option, each redemption payment can be made in cash or stock at a discount to the then-current closing bid price at the time of the redemption. The investor will also have the right to an accelerated conversion of any or all of the outstanding balance of the Notes into stock. The Notes will be secured by substantially all assets of the Company and will rank superior to all outstanding and future indebtedness of the Company. The Warrant can be exercised on a cashless basis. The exercise price of the Warrant is subject to (i) customary anti-dilution adjustments; and (ii) in the case of a subsequent equity sale at a per share price below the exercise price, the exercise price of the Warrant will be adjusted to such lower price, and the number of shares underlying the Warrant will increase proportionately.
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The Company expects to use the proceeds from the sale of the Notes for general corporate purposes, which may include, among other things, research and development, legal and accounting fees. The Notes, Warrants, and the shares issuable upon the conversion of the Notes and the exercise of the Warrants are offered and sold pursuant to exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) thereof and Rule 506 of Regulation D promulgated thereunder.
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