SRX Global Inc. Announces Private Placement of Series C Convertible Preferred

What Happened

• On August 27, 2026, SRX Global Inc. (SRXH) entered a Securities Purchase Agreement selling 3,579 shares of newly designated Series C convertible preferred stock for aggregate consideration of $2,862,500. The purchase price was satisfied by the investors assigning certain Convertible Grid Promissory Notes issued by CERO Therapeutics Holdings, Inc. (aggregate original principal $2,812,500) to SRX.
• The company adopted a Certificate of Designations for up to 4,000 Series C shares. Each Series C share has a stated value of $1,000 and converts into common stock at a fixed conversion price of $2.1888 per share, subject to adjustment and alternative conversion provisions (including 95% VWAP or 90% VWAP on certain triggering events). The company also entered a Registration Rights Agreement requiring it to file an SEC registration to allow resale of common stock issued on conversion and on exercise of related warrants.

Key Details

• Sale date: August 27, 2026; Series C shares sold: 3,579; purchase price: $2,862,500.
• Conversion price: $2.1888 per common share; stated value per preferred share: $1,000. If fully converted at the fixed price, the 3,579 Series C shares could equal roughly 1.6 million common shares (approximate).
• Voting: Series C holders have no voting rights. Company may redeem all outstanding Series C shares in cash (125% of specified redemption metric).
• Covenants & protections: Company must reserve at least 200% of the common shares needed for conversion, is restricted from certain dividends/repurchases, incurring additional debt or liens, and cannot effect specified fundamental transactions without assuming obligations to holders.

Why It Matters

• Potential dilution: The new preferred carries a low conversion price ($2.1888) and could convert into a material number of common shares (roughly ~1.6M shares based on stated values), which investors should compare to SRX’s current float and market capitalization.
• Liquidity and resale: SRX agreed to register the resale of shares issuable on conversion/exercise, which can help holders sell converted shares once the registration is effective, but the company must also obtain stockholder approval under NYSE American rules for issuance of the underlying common stock.
• Corporate flexibility: Protective covenants, reservation requirements and redemption provisions limit SRX’s ability to take on certain actions (e.g., additional preferred issuances, certain indebtedness, repurchases or dividends) while Series C shares remain outstanding — factors that may affect the company’s capital strategy.