I fixed the commenting up a bit, and added a few todos which in my opinion should help the developer (@jenn4).

ExpBot II.lua

--ExpBot II (Experimental Bot V2.1) - An simple IRC bot written in Lua - the programming language.
-- Comments are written in the luadoc style
-- http://keplerproject.github.io/luadoc/manual.html#tags

require "socket"
s = socket.tcp()
-- passwords are received from standard input
passLine = io.read()

network = "chat.eu.freenode.net" --
nick = "ExpBot"			 --
user = "jenn4" 			 --
mode = "8"                       -- leave this as such
realname = "ExpBot"  		 -- reported as the "Real Name"
channels = "#jenn4"		 -- auto-joining - separate multiple channels with ONLY a comma "#a,#b,##c"
prefix = "!!"                    -- prefix commands with this
msg = {}

--- Pause running for a little while. 
-- @param n {number} seconds to pause
clock = os.clock
function sleep(n) 
	
 	local t = clock() 
 	while clock() - t <= n do end 
end 

--- Tell the IRC server about us
-- @see RFC 1459
function sendInitialConfig()
 	
 	print("<< Sending configuration. >>")
 	print("<< Your password, please. >>") 
 	-- TODO replace with a raw IRC wrapper? (automatically adds \r\n if needed, validates) 
 	s:send("PASS " .. passLine .. "\r\n") 
	s:send("NICK " .. nick .. "\r\n") 
	s:send("USER " .. user .. " " .. mode .. " * " .. " :" .. realname .. "\r\n") 
	s:send("JOIN " .. channels .. "\r\n") 
end 

--- Interprets the IRC data and handles pingpongs
function handleRawIRC()
	if output:match "PING :" then 
		s:send("PONG :" .. output:match"^PING :(.*)") -- idk but boxmein
	end
end

--- Okay now actually connect to the server, promise
-- This is also the entry point for the application.
function init()
	
	s:connect(network, 6667)
	sendInitialConfig()
	
	while true do
		output = s:receive("*l*") -- A trick to remove \r\n from input. 
		print(output) -- debug!
		-- TODO don't use global variables here?
		handleRawIRC() 
	end
end

init()