SharonAI Holdings Inc. 8-K

What Happened
SharonAI Holdings Inc. announced it completed a private offering of $350 million aggregate principal amount of 6.00% Convertible Senior Notes due 2031. The Purchase Agreement was dated April 26, 2026, the Indenture was dated May 18, 2026, and the transactions closed on May 20, 2026. The Notes are senior, unsecured obligations of the company, guaranteed by certain subsidiaries and administered by U.S. Bank Trust Company as trustee.

Key Details

• Offering size and terms: $350,000,000 principal amount of 6.00% convertible senior notes due May 1, 2031; interest accrues from issuance and is payable quarterly.
• Conversion: Initial conversion rate of 20.7292 shares of Class A common stock per $1,000 principal (≈ $48.24 per share); conversion rate adjustable and capped at 24.8750 shares per $1,000.
• Share issuance limits and mechanics: Maximum of 8,706,250 shares issuable at the capped conversion rate (11,292,009 shares if accrued interest also converted). Holders are subject to a Restricted Beneficial Ownership Percentage (initially 4.99%); excess shares instead trigger issuance of pre-funded warrants exercisable at $0.0001 per share.
• Other protections and covenants: Notes are not redeemable by the company; holders can require repurchase at 100% of principal plus accrued interest on a Fundamental Change; Indenture includes customary covenants (including a debt maintenance covenant and a prohibition on incurring secured debt over $25 million) and events of default (including specified payment and bankruptcy triggers).

Why It Matters
This transaction raises $350 million of capital while giving investors a fixed 6% coupon plus the option to convert debt into equity at defined rates. For shareholders, conversion would dilute existing equity if holders convert or if the company is forced to convert under specified market conditions. For creditors and prospective investors, the notes are senior unsecured debt with subsidiary guarantees and include typical protections and default provisions that affect repayment priority and the company’s flexibility on future financing. The Restricted Beneficial Ownership Percentage and pre-funded warrants are designed to limit concentrated ownership from conversions.