Nexalin Technology Enters $1.0M Note Purchase Agreement

What Happened
Nexalin Technology, Inc. announced on August 21, 2026 that it entered into a Note Purchase Agreement with an institutional investor and issued an unsecured promissory note. The face amount of the note is $1,170,000, which reflects an original issue discount of $150,000 and $20,000 in investor transaction expense reimbursement, for net cash proceeds to Nexalin of $1,000,000. The note matures six months after funding and does not bear interest unless and until an event of default occurs.

Key Details

• Net proceeds: $1,000,000; stated note amount: $1,170,000 (includes $150,000 OID and $20,000 expense reimbursement).
• Maturity: 6 months after funding; Company may prepay any time without penalty.
• Mandatory prepayment: each time Nexalin raises funds, it must prepay the lesser of 20% of the amount raised or the outstanding balance.
• Extensions & penalties: Company may extend maturity up to two times (each by 3 months) with investor consent; an extension increases the outstanding balance by 7.5% at the start of each extension period. Trigger events can increase the balance by 10% (Major) or 5% (Minor), capped at 25% aggregate. If a default occurs and is not cured, the investor may accelerate repayment and interest accrues at 18% per annum (or legal maximum).
• Security and protections: The note is unsecured; the agreement contains customary representations, covenants, default triggers, and investor indemnification/expense-advancement rights.

Why It Matters
This filing documents new short-term debt for Nexalin and provides $1.0M in immediate cash. The terms include mandatory prepayments tied to future financings and significant penalties and high default interest (up to 18%) if certain trigger events or defaults occur. Investors should note the company took unsecured, short-dated financing with features that can materially increase the amount due if contractual triggers or defaults happen.