NuZee Enters Into $10 Million Convertible Note and Warrant Purchase Agreement

On December 12, 2024, NuZee (NASDAQ: NUZE) announced the signing of a convertible note and warrant purchase agreement with select non U.S. investors. The agreement, made by CIMG Inc., a Nevada corporation, involves a private placement of convertible promissory notes totaling $10,000,000 and warrants allowing the purchase of up to 19,230,767 shares of the company’s common stock. These transactions are being conducted under the registration exemptions of Regulation S.

The notes carry an annual interest rate of 7% and reach maturity one year from the issue date. Conversion of these notes and exercise of the warrants are pending shareholder approval for the issuance of the underlying shares. Upon obtaining approval, the noteholder can convert the notes into NuZee common stock at a conversion price of $0.52 per share.

In conjunction with the Purchase Agreement, NuZee entered into a Registration Rights Agreement with the Investors on the same day. Per this agreement, the company will file an initial Registration Statement on Form S-1 with the SEC to cover the resale of all registrable securities within 30 days after the filing of the Form 10-K for the fiscal year ended September 30, 2024.

The sale and purchase of the notes and warrants will occur at a closing to be scheduled by the company and investors, with the final closing set for no later than January 14, 2025. However, NuZee reserves the right to extend or terminate the offering period at its discretion.

The company disclosed the detailed terms and provisions regarding the Purchase Agreement, the Notes, the Warrant, and the Registration Rights Agreement in Exhibits 10.1, 10.2, 10.3, and 10.4 respectively, attached to the Form 8-K filing.

This strategic move by NuZee signals a significant financial development for the company, providing a path for further growth and potential opportunities in the market.

The incorporation of the announcement from the Form 8-K filing implies a substantial financial obligation will be undertaken by NuZee, expected to impact the company’s financial position and strategic direction moving forward.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read NuZee’s 8K filing here.

About NuZee

NuZee, Inc, together with its subsidiaries, manufactures, packs, and sells single-serve pour-over coffee and tea bag-style coffee for coffee roasters and food service companies in North America and South Korea. The company sells its products under Coffee Blenders, Twin Peaks, DRIPKIT, and Stone Brewing brand names.