Netcapital Inc.: enters securities purchase agreement up to $641,936.66

What happened

• The filing says that on Oct 14, 2026 Netcapital Inc closed the first tranche of transactions under a Securities Purchase Agreement dated Oct 13, 2026 with Hinterland Partners LLC.
• The Company issued a promissory note in an aggregate principal amount of up to $641,936.66 for an aggregate purchase price of up to $577,743.00 (reflecting an original issue discount of up to $64,193.66). Hinterland paid $402,743.00 at the first-tranche closing, and the outstanding principal became $447,492.22.

Key details

• Second tranche: Hinterland must fund a second tranche with a purchase price of $175,000.00 within five business days after conditions are met within 90 calendar days after the Purchase Agreement (including no default, no breach, Nasdaq listing maintained, and the Company becoming current on required Exchange Act filings). Upon closing the second tranche principal increases by $194,444.44 and accrued interest increases by $23,333.33.
• Interest and term: the Note bears a one-time interest charge of 12% on the principal of each tranche (up to $77,032.39 aggregate; $53,699.06 attributable to the first tranche). Each tranche matures 12 months after its funding date.
• Security and conversion: the Note is secured by a pledge of 3,209,685 shares of Class A common stock of KingsCrowd, Inc. Hinterland may convert all or any portion of the Note into the Company’s common stock; conversion price is 85% of the lowest traded price over the seven trading days before conversion, subject to adjustments and a 4.99% beneficial ownership limitation. Hinterland may deduct $1,950.00 per conversion to cover fees.
• Equity consideration and limits: as additional consideration the Company issued Commitment Shares equal to 20% of each tranche’s principal divided by the prior trading day’s closing price; the Company issued 64,387 Commitment Shares for the first tranche. Aggregate shares issuable to Hinterland under the transaction documents are limited to 1,603,685 shares unless shareholder approval is obtained; the Company must hold a special meeting on or before 180 calendar days after the Purchase Agreement for that purpose.
• Covenants, defaults and remedies: the Note and Purchase Agreement include customary and transaction-specific covenants, specified events of default (including failure to comply with Exchange Act reporting after Feb 9, 2027 and failure to maintain a market capitalization of at least $3,000,000), and remedies including acceleration (amounts multiplied by 150%) and conversion of defaulted amounts.

Why it may matter

• Item 1.01 was reported (entry into a material definitive agreement) covering the Purchase Agreement, the promissory Note and related transaction documents. Item 2.03 (creation of a direct financial obligation) and Item 3.02 (unregistered sales of equity securities) were also reported in connection with the Note and the Commitment Shares/warrants.
• The filing describes the financial terms, security, conversion mechanics, equity issuance limits and events of default under the transaction documents. A filing does not show why the insider traded or why the company acted.