Fangdd Network announces $34.3M convertible note issuance

Fangdd Network (DUO) Group entered into a convertible note purchase agreement pursuant to which the Company will issue a convertible promissory note in a principal amount of $34,320,000 to an investor through private placement. The Note will be issued to satisfy the Company’s certain payment obligations under an asset purchase agreement dated September 29 by and between the Company and the investor. Detailed information about the asset purchase agreement can be found in the Company’s current report on Form 6-K furnished to the U.S. Securities and Exchange Commission on September 30. The issuance of the Note is subject to the satisfaction of customary closing conditions. The Note will mature in 364 days after issuance without bearing interest. Prior to the full repayment of the outstanding principal amount, the Note is convertible into Class A ordinary shares at the option of the Note holder, at a conversion price of $1.0409. If not previously converted, the outstanding principal amount of the Note will automatically convert into Class A Ordinary Shares on the maturity date. The Note will be an unsecured general obligation of the Company. The foregoing description of the Note and the Purchase Agreement is qualified in its entirety by reference to its full text, which will be furnished to the SEC on a current report on Form 6-K. To maintain a stable corporate structure following the potential conversion of the Note, the Company entered into a share subscription agreement with ZX INTERNATIONAL LTD, a British Virgin Islands company controlled by Mr. Xi Zeng, the chairman of the board of directors and chief executive officer of the Company. Pursuant to this agreement, the Company has agreed to sell and issue up to 12,731 Class C ordinary shares of the Company with the same rights, privileges and restrictions approved by the board of directors on November 29, 2022 to ZX INTERNATIONAL LTD, if the Company receives a conversion notice from the Note holder, subject to the limitations set forth in the share subscription agreement. The per share purchase price will be calculated based on the average closing price of the Company’s Class A Ordinary Shares for the 15 trading days prior to the closing notice date. The foregoing description of the share subscription agreement is qualified in its entirety by reference to its full text, which will be furnished to the SEC on a current report on Form 6-K.