What are the terms of the lock‑up agreement for the selling shareholder's 550,000 shares?

Lock‑up terms

The prospectus for Magnitude International Ltd.’s IPO states that the selling shareholder’s 550,000 ordinary‑share sale is subject to a standard 180‑day lock‑up after the company’s listing on Nasdaq. During this period the shareholder cannot sell, transfer, pledge, or otherwise dispose of any of those shares, nor can any affiliate or controlled entity do so, without the underwriters’ prior written consent. The lock‑up also includes a “no‑sell‑back” clause that prevents the shareholder from reacquiring the shares for the duration of the period. No additional performance‑based or price‑triggered extensions were disclosed, so the restriction is a straight 180‑day hold‑period with the typical “sell‑off‑the‑floor” restriction.

Trading implications

Because the 550,000 shares (≈ 25 % of the total 2.2 M‑share offering) are locked for six months, the supply side of the stock is effectively capped for that period, which can help support the post‑IPO price by limiting immediate dilution. However, once the lock‑up expires, a potential “unlock‑driven” sell‑off could add upward pressure on supply, especially if the stock trades near the $4.00 IPO price or higher. Traders should watch the lock‑up expiration date (approximately mid‑February 2026) and monitor any secondary market activity or insider sentiment leading up to that date. A prudent approach is to maintain a modest long‑position or buy‑on‑dip strategy now, but be prepared to reduce exposure or set protective stops a few weeks before the 180‑day expiry, when a cluster of sell orders could create volatility. The lack of proceeds to the company also means the IPO proceeds are entirely from the selling shareholder; therefore, the company’s cash position will not be bolstered by the IPO, which could modestly limit its near‑term growth capital and affect valuation.