CID Holdco, Inc. 8-K/A

What Happened
CID Holdco, Inc. (DAIC) announced on March 6, 2026 that it entered a Loan Agreement with J.J. Astor & Co. allowing up to $5.0 million in four tranches. An initial tranche funded December 5, 2025 (the Initial Loan) was documented by a Senior Secured Convertible Note with an original principal of $2.6M (Initial Note), of which $1.84M was actually funded after lender origination fees. The Initial Loan matures November 30, 2026 and is payable in 12 monthly installments starting December 31, 2025. Up to three additional $1.0M tranches are available upon notice and lender election; each additional tranche is evidenced by a convertible note with $1.3M original principal and $960K funded after fees. The Company issued lender warrants to purchase up to 230,770 shares at $1.69 per share and granted the lender first-priority security interests in substantially all assets and 100% of certain subsidiaries.

Key Details

• Facility size: up to $5,000,000 in four tranches; Initial Loan funded Dec 5, 2025 (Initial Note original principal $2,600,000; funded $1,840,000).
• Repayment: Initial Loan matures Nov 30, 2026; monthly installments (first payment $108,334 on Dec 31, 2025; eleven payments of $226,615.18).
• Collateral & guarantees: first-priority security interest in substantially all assets and pledges of 100% equity of SEE ID, Inc., ShoulderUp Technology Acquisition Corp., and DotWorks, Inc.; subsidiary guarantees executed.
• Equity impact & conversion: Lender Warrants to buy up to 230,770 shares at $1.69; convertible note conversions/use of registration rights tied to formula (conversion price = 80% of the average of the four lowest VWAPs of the 20 trading days before conversion notice) and subject to ownership caps (generally 4.99%, potentially raised to 9.99% by agreement) and Nasdaq rules.
• Cash flow mechanics: Company required to draw on an existing ELOC with New Circle Principal Investments, LLC to fund monthly payments; New Circle will remit 80% of ELOC proceeds to the lender and 20% to the Company.
• Default remedies: lender may accelerate, pursue enforcement against collateral and, per the agreement, may enter a confession of judgment in Utah; default interest and other remedies apply.

Why It Matters
This transaction provides CID Holdco with near-term liquidity but creates secured debt obligations and potential equity dilution. The loans are senior and secured by most company assets and subsidiaries, which increases creditor priority. Conversion features and warrants introduce dilution risk to existing shareholders if converted/exercised, and conversion is tied to a discounted VWAP formula. Monthly payments are expected to be funded through the Company’s ELOC with New Circle (80% of those ELOC proceeds flow to the lender), which affects the Company’s available cash. Investors should note the material default remedies and security interests, and that additional tranches are conditional on trading price/volume and other covenants.