Cycurion, Inc. 8-K

What Happened
On June 1, 2026, Cycurion, Inc. announced exchange and restructuring agreements with three existing lenders — IQ Financial, M2B Funding Corp. and Obsidian Associates — converting outstanding obligations into new convertible promissory notes and shares of newly authorized Series H Convertible Preferred Stock. Key amounts exchanged include approximately $517,604.40 with IQ Financial; a $1,326,748.31 new note and 952.7 Series H shares (stated value ≈ $952,695.73) with M2B; and a $1,083,003.41 new note plus 947.25 Series H shares (totaling ≈ $947,250 in default charges) with Obsidian. Prior notes and default-related charges were cancelled and satisfied on closing.

Key Details

• Total obligations restructured across the three counterparties are approximately $4.83 million.
• New convertible notes convert at $1.05 per share; Series H preferred converts at a floor price of $1.45 per share.
• Series H terms: voting on an as‑converted basis, 12% per annum dividend payable quarterly in common stock, liquidation preference equal to stated value, and holder protective provisions. 3,000 shares of Series H were authorized.
• Resale (leak‑out) restrictions limit conversion-related share sales to no more than 5% of the Company’s average daily trading volume for certain counterparties.
• Securities were issued in unregistered transactions relying on exemptions (Section 4(a)(2), Regulation D, and Section 3(a)(9) of the Securities Act).

Why It Matters
This restructuring removes existing default claims and consolidates cash and default obligations into convertible debt and preferred equity, reducing near‑term cash pressure from those creditors. However, the new instruments can convert into common stock (at $1.05 for notes and $1.45 for Series H), which creates potential dilution if and when conversions occur. The Series H dividend (paid in common shares) and the conversion mechanics mean holders will receive economic value primarily through equity, not cash. Investors should note the conversion prices, the 5% leak‑out resale limits, and the preferred holders’ protective rights — all of which affect potential dilution, voting influence, and the timing of any future resale of shares.