HNOI · HNO International, Inc.

HNO International secured financing through a Securities Purchase Agreement with Monroe Street Capital Partners, LP, issuing a Convertible Promissory Note with a $67,500 principal amount that includes a $5,000 original issue discount and a guaranteed 8% one-time interest charge of $5,400. The note matures in 12 months on May 5, 2027, and offers conversion into common stock at a deep discount of 60% of the lowest trading price over the prior 20 trading days, with deductions for conversion fees and a 4.99% beneficial ownership cap to limit immediate dilution. Accompanying the note is a five-year warrant for 385,000 shares at a $0.25 exercise price, also capped at 4.99% ownership and exercisable on a cashless basis under certain conditions. The transaction yielded gross proceeds of $62,500 but netted approximately $57,625 after withholdings for legal fees and placement agent compensation via Craft Capital Management LLC. To support potential conversions and exercises, the company irrevocably reserved 20,000,000 shares through instructions to its transfer agent, Pacific Stock Transfer Company, with provisions allowing the buyer to demand increases. Protective covenants include events of default triggering 150% repayment, default interest up to 18%, and restrictions barring variable rate transactions, a 30-day moratorium on new share issuances, and granting the buyer participation rights in future financings for up to 18 months or until note repayment. These terms signal high-risk, dilutive financing typical for distressed or growth-stage companies facing liquidity needs, with significant equity overhang from the reservation and conversion discounts.