KIDZ AI Inc. Issues $1.9M Senior Secured Convertible Note

What Happened KIDZ AI Inc. announced an additional closing under a May 30, 2025 Securities Purchase Agreement with Solana Growth Ventures LLC, issuing a senior secured convertible note in the original principal amount of $1,900,000 on September 17, 2026. The Additional Note bears interest at 7% per year, matures on September 17, 2028, and is convertible at the holder’s option into the company’s Class B common stock at an initial conversion price of $3.672 per share (subject to adjustment). Interest is payable quarterly and, under the note’s terms, may be paid in cash, added to principal, or paid in shares of common stock. The funding amount was $1.9M less placement agent fees and other offering expenses payable by the company.

Key Details

• Issuer: KIDZ AI Inc.; Buyer: Solana Growth Ventures LLC.
• Principal: $1,900,000; Interest rate: 7% per annum; Maturity: Sept 17, 2028.
• Convertible into Class B common stock at $3.672/share (holder option; adjustment provisions apply).
• Note ranks senior to existing and future indebtedness (subject to stated exceptions) and is secured by a first-priority perfected security interest in the collateral securing the Notes.
• Offer relied on exemption from registration under Section 4(a)(2) of the Securities Act.

Why It Matters This transaction provides KIDZ AI with near-term financing (~$1.9M before fees) and adds a senior secured obligation to its capital structure. The note’s convertibility and the company’s option to pay interest in shares create potential future dilution for existing shareholders if conversion or stock interest payments occur. The senior, secured nature of the note affects repayment priority versus other creditors, which is material for debt holders and equity investors evaluating balance-sheet risk and potential dilution.