SHENZHEN, China, Jan. 4, 2023
/PRNewswire/ -- Addentax Group Corp. ("Addentax" or the
"Company") (Nasdaq: ATXG), an integrated service provider focusing
on garment manufacturing, logistics service, property management
and subleasing, and epidemic prevention supplies, today announced
that it has entered into a securities purchase agreement with
certain accredited investors for the sale and issuance of a new
series of senior secured convertible notes in the original
principal amount of $16,666,666.66
(the "Notes") and common stock purchase warrants purchase up to
16,077,172 shares of common stock of the Company (the "Warrants")
at an exercise price of $1.25 per
share, subject to customary closing conditions. The net proceeds,
after original issue discount will total $15
million.
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
July 4, 2024, 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.
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.
Univest Securities, LLC served as the sole placement agent in
the transaction.
About Addentax Group Corp.
Addentax Group Corp. is an integrated service provider focusing
on garment manufacturing, logistics service, property management
and subleasing, and epidemic prevention supplies. Its garment
manufacturing business consists of sales made principally to
wholesaler located in China. The
logistics business consists of delivery and courier services
covering 79 cities in seven provinces and two municipalities in
China. The property management and
subleasing business provides shops subleasing and property
management services for garment wholesalers and retailers in
garment market. The epidemic prevention supplies business consists
of manufacturing and distribution of epidemic prevention products
and resale of epidemic prevention supplies purchased from third
parties in both domestic and overseas markets. For more
information, visit the Company's website at
https://www.addentax.com/.
Forward-Looking Statements
All statements other than statements of historical fact in
this announcement are forward-looking statements in nature within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve known and unknown
risks and uncertainties and are based on current expectations and
projections about future events and financial trends that the
Company believes may affect its financial condition, results of
operations, business strategy and financial needs. Words or phrases
such as "may," "will," "expect," "anticipate," "aim," "estimate,"
"intend," "plan," "believe," "potential," "continue," "is/are
likely to" or other similar expressions are intended to identify
such forward-looking statements. The Company undertakes no
obligation to update forward-looking statements to reflect
subsequent occurring events or circumstances, or changes in its
expectations, except as may be required by law. Although the
Company believes that the expectations expressed in these
forward-looking statements are reasonable, it cannot assure you
that such expectations will turn out to be correct, and the Company
cautions investors that actual results may differ materially from
the anticipated results and encourages investors to consider risk
factors, including those described in the Company's filings with
the SEC, that may affect the Company's future results. All
forward-looking statements attributable to the Company and its
subsidiaries or persons acting on their behalf are expressly
qualified in their entirety by these risk factors.
For more information, please contact:
Investor Relations:
Sherry
Zheng
Phone: 718-213-7386
Email: shunyu.zheng@weitian-ir.com
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SOURCE Addentax Group Corp.