OLENOX INDUSTRIES INC. 8-K

What Happened

• Olenox Industries Inc. announced it closed the acquisition of CS Digital Ventures, LLC on May 26, 2026. The upfront purchase price totals US$30,000,000, paid via US$14,000,000 in newly issued Series D Preferred Stock and a US$16,000,000 unsecured promissory note (the “Seller Note”). The company also issued warrants and may issue additional preferred shares if post‑closing milestones are met.

Key Details

• Upfront consideration: US$30.0M (US$14.0M Series D Preferred Stock + US$16.0M Seller Note).
• Warrants: 1,500,000 total common‑share warrants (three tranches of 500,000) with exercise prices of $5.00, $7.00 and $9.00. Warrants are not exercisable until stockholder approval is obtained.
• Earnout: Up to an additional US$20.0M in Series D Preferred Stock payable upon meeting revenue and Adjusted EBITDA milestones.
• Conversion & governance limits: Series D and the Warrants cannot convert/exercise into common stock until Olenox obtains the requisite Nasdaq/stockholder approval; conversion/exercise is subject to a 19.9% beneficial‑ownership cap. The Company filed a Certificate of Designation for the Series D (non‑voting, $1.00 conversion price fixed).

Why It Matters

• Capital structure and potential dilution: The deal adds a new class of Series D preferred and warrants that could convert into common stock if and when stockholders approve—plus up to $20M more in preferred shares tied to earnouts—so shareholders should watch for potential dilution.
• New debt obligation: Olenox now has an unsecured $16M Seller Note (interest, maturity and default terms in the filing), which is a new financial obligation to monitor.
• Liquidity and timing: Warrants and preferred conversions are blocked until stockholder approval under Nasdaq rules; the company must use best efforts to call a vote and will file a resale registration statement within 60 days after approval.
• Management protections and limits: The purchase includes two‑year non‑compete/non‑solicit covenants for key sellers, and indemnification terms (18‑month survival, $100k basket, $10M cap with standard exceptions).

Investors should review the full 8‑K and related exhibits for the complete Purchase Agreement, Seller Note and Warrant forms, and monitor Olenox communications for the scheduled stockholder vote and any updates on earnout achievement or integration plans.