AI Era Corp. 8-K

What Happened

• On January 9, 2026, AI Era Corp. entered into a Securities Purchase Agreement with Vanquish Funding Group Inc. and issued a $232,000 convertible promissory note. The note matures October 15, 2026 (nine months), carries 10% annual interest payable at maturity, and begins permitting conversion into common stock 180 days after issuance.

Key Details

• Principal and proceeds: $232,000 principal; original issue discount of $7,000 (including $2,500 legal fees and $4,500 due diligence fees), net proceeds to the company of $225,000.
• Conversion terms: conversion permitted after 180 days at a price equal to 80% of the lowest trading price during the 20 trading days before conversion (a 20% discount).
• Ownership cap and prepayment: lender limited to conversions that don’t exceed 4.99% beneficial ownership (can be waived to 9.99%); company may prepay within first 180 days at 120% of outstanding principal plus accrued interest, but cannot prepay after 180 days without lender consent.
• Default protections: customary default provisions that can accelerate repayment and increase payback to 150% or 200% of principal in certain defaults, and may adjust the conversion price downward.

Why It Matters

• This 8-K discloses a short-term financing transaction that provides AI Era about $225K in cash now but creates a liability that could dilute shareholders if converted at a discounted price after 180 days. The note’s interest, hefty prepayment premium in the first 180 days, and severe default penalties increase the potential cost to the company. Investors should monitor the company’s stock price and filings for any conversions, prepayment actions, or waivers of the ownership cap that could affect share count and ownership percentages.