OLENOX INDUSTRIES INC. 8-K

What Happened
Olenox Industries Inc. announced on June 16, 2026 that it closed an acquisition of 100% of CS Digital Ventures, LLC under an Amended and Restated Membership Interest Purchase Agreement. Aggregate upfront consideration was $30.0 million, consisting of $14.0 million in newly issued Series E convertible preferred stock and a $16.0 million unsecured promissory note (the “Seller Note”). The company also issued warrants to purchase 1,500,000 shares of common stock (three tranches of 500,000 at $5.00, $7.00 and $9.00) and agreed to issue up to $20.0 million in additional Series E preferred shares tied to two post-closing earnout milestones (cumulative revenue and cumulative Adjusted EBITDA). Olenox filed a Certificate of Designation for the Series E preferred stock with the Delaware Secretary of State on June 17, 2026.

Key Details

• Closing date / agreements: Amended Purchase Agreement and Exchange Agreement executed June 16, 2026; Certificate of Designation filed June 17, 2026.
• Upfront consideration: $30,000,000 total — $14,000,000 in Series E Preferred Stock (issued at $100 stated value) and $16,000,000 unsecured Seller Note.
• Equity instruments: 1,500,000 warrants (500K each at $5/$7/$9) and up to $20,000,000 in additional Series E Earnout Shares if milestones met. Warrants are not exercisable before stockholder approval.
• Conversion limits and approvals: Series E conversion and warrant exercises are subject to a 19.9% Exchange Cap and a beneficial ownership limit of 19.9%; Olenox will seek Nasdaq-required stockholder approval (first meeting within 90 days post-closing and every 3 months thereafter until obtained). The Company must file a resale registration statement within 60 days after obtaining stockholder approval.
• Other terms: Seller Note is unsecured with customary terms; Series E is non-voting (except as required by law), has a fixed conversion price of $1.00 per share, and is not redeemable; customary 2‑year non‑compete/non‑solicit covenants for key sellers; indemnity framework includes an $10M cap, $100k basket and 18‑month survival for reps/warranties (with standard exceptions).

Why It Matters
This transaction brings CS Digital into Olenox and funds the purchase primarily with preferred stock and a $16M unsecured note, plus potential future equity if earnout targets are met. For investors, the key takeaways are potential dilution (via Series E conversion, warrants and earnout shares) subject to a 19.9% capped conversion and additional beneficial ownership limits unless shareholders approve higher conversion/exercise limits under Nasdaq rules. The Series E shares are non‑voting and not immediately convertible/exercisable until the company secures the required stockholder approval and completes registration for resale, which affects near‑term voting and liquidity. The Seller Note adds indebtedness and the earnout ties additional equity issuance to CS Digital’s post‑close financial performance.