CDT Equity Inc. 8-K

What Happened

• CDT Equity Inc. announced on June 11, 2026 that it entered a Loan Agreement with J.J. Astor & Co. and issued a senior secured convertible promissory note with a principal amount of $1,971,000. The Company will receive $1,460,000 in loan proceeds (funded in two tranches) and granted a first‑priority lien on collateral; its U.K. subsidiary, CDT Equity Ltd., provided a guaranty. The Company issued Common Stock Purchase Warrants to buy 912,500 shares at $0.72 per share and agreed to registration rights for conversion and warrant shares.

Key Details

• Principal amount of the Note: $1,971,000; cash funded to the Company: $1,460,000 (two tranches).
• Repayment: 24 equal weekly installments of $82,125 beginning June 18, 2026 (payments may be in cash or, after an SEC registration statement is effective, in Common Stock upon conversion).
• Conversion & timing: Lender may convert outstanding balance beginning six months after closing (starting Dec 11, 2026), subject to shareholder approval; conversion price = greater of 90% of the 10‑day VWAP before conversion notice or Nasdaq floor price.
• Default terms: on default, outstanding balance increases to 120% and accrues default interest at 19% per annum, compounded daily.
• Registration and stockholder approval: Company must file a resale Registration Statement by July 26, 2026 and has agreed to seek stockholder approval for issuance of conversion/warrant shares (required if aggregate issuance would exceed 19.99% of outstanding shares).
• Cash flow waterfall from existing equity line: while utilized, 80% of net proceeds from the Company’s Sales Agreement with A.G.P. go to pay the weekly installments; thereafter 50% of net proceeds go to satisfy the Note.

Why It Matters

• Liquidity: The transaction provides immediate near‑term cash of $1.46M to fund operations or obligations.
• Potential dilution: The Note is convertible and the Lender received warrants; if converted or exercised (and after required shareholder approvals/registration), these instruments could increase the Company’s outstanding shares.
• Credit risk and cost of default: The Note bears no interest unless a default occurs; however, default triggers a significant penalty (120% payoff plus 19% compounded interest) and accelerated registration obligations, which are material downside protections for the lender.
• Security and guarantee: The loan is senior, secured by a first‑priority lien and backed by a guaranty from the UK subsidiary, giving the lender priority over certain Company assets.

A press release announcing the transaction was issued on June 16, 2026 and is attached as an exhibit to the 8‑K.