Crown ElectroKinetics Corp. announced that it has entered into a note purchase agreement with certain institutional and accredited investors for private placement of 12% senior convertible promissory notes for gross proceeds of $1,050,000 on June 2, 2020. The convertible notes are unsecured, accrue interest at a rate of 12% per annum and mature on June 2, 2021 and will be issued at par. The company has guaranteed to the holders the payment in full of interest at such rate for the full term of the convertible notes. Each note is convertible, at the option of the holder, into common shares at a conversion price, subject to adjustment as set forth in the notes, equal to the lower of $12,000,000 divided by the then-outstanding number of common shares or in the event the company consummates a financing at a pre-money valuation less than $12,000,000, 90% of the reduced valuation divided by the then-outstanding number of common shares. The company may prepay the note in cash at a amount equal to 125% of outstanding principal and accrued interest during first 6 months. The company will also issue warrants exercisable at a price equal to 125% of the conversion price on or prior to June 3, 2025. The company will issue securities pursuant to exemption provided under Regulation D. The transaction is expected to close on June 3, 2020.