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Maison Solutions Inc. (NASDAQ:MSS), a company with a market capitalization of $17.31 million and current stock price of $0.77, announced Wednesday that it has issued an additional senior unsecured convertible promissory note with a principal amount of $3 million to an investor, according to a statement based on a Securities and Exchange Commission filing. According to InvestingPro data, the company’s total debt stands at $47.62 million.
The note was issued as part of a partial exercise of a previously disclosed note purchase warrant, which allows for the purchase of up to $6.5 million in senior unsecured convertible promissory notes under a securities purchase agreement dated March 12, 2025.
The newly issued note matures on October 22, 2027, and bears interest at 5.25% per annum. The note was sold at a purchase price of $2,745,000. In the event of default, the interest rate may increase to 18% per annum. Interest payments are due monthly and may be paid in cash or, at the company’s option, in shares of Maison Solutions’ Class A common stock, subject to certain terms.
The holder of the note has the right to convert it into shares of common stock, provided that the holder’s total beneficial ownership does not exceed 4.99% of Maison Solutions’ outstanding common stock, unless increased up to 9.99% with prior notice. The initial conversion price is set at $0.78 per share, with a floor price of $0.16 per share. The conversion price may be adjusted monthly to the lower of the current fixed price and 95% of the lowest daily volume-weighted average price (VWAP) during the prior ten trading days, subject to further terms specified in the note.
If certain events, defined as “Amortization Events,” occur, Maison Solutions will be required to make monthly payments equal to one-sixth of the aggregate principal outstanding plus 20% of that amount. The note also includes provisions for adjustment of the conversion price in the event of a dilutive issuance by the company and outlines standard events of default.
The company stated it intends to use the proceeds for working capital purposes for itself and its subsidiaries. Despite reporting strong revenue growth of 70% over the last twelve months to $123.2 million, the company has not been profitable during this period. The transaction was completed in a private placement relying on exemptions from registration under the Securities Act of 1933. Get access to 10+ additional key financial insights and ProTips about Maison Solutions with InvestingPro, including detailed analysis of the company’s financial health and growth prospects.
All information is based on a press release statement and the company’s SEC filing.
In other recent news, Maison Solutions Inc. has made significant strides with its financial strategies and corporate decisions. The company announced an initial closing under a Securities Purchase Agreement, issuing a senior secured convertible promissory note valued at $3 million. This move is part of a broader plan, as Maison Solutions aims to invest up to $70 million in Worldcoin for its digital asset treasury. Worldcoin, co-founded by OpenAI CEO Sam Altman, is intended to support various blockchain initiatives.
Additionally, Ascendiant Capital has initiated coverage of Maison Solutions with a Buy rating, setting a price target of $4.00. This reflects a positive outlook on the company’s future prospects. On the corporate front, Maison Solutions has approved salary increases for its CEO, John Xu, and CFO, Alexandria Lopez, effective January 2025. These developments highlight the company’s ongoing efforts to expand its financial and operational footprint.
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