C2 Blockchain, Inc. 8-K

What Happened

• C2 Blockchain, Inc. announced on Form 8-K that it issued a convertible promissory note dated April 23, 2026 to Labrys Fund II, L.P. The note has a principal amount of $120,000 (reflecting a $20,000 original issue discount), provided $100,000 in gross proceeds to the company, bears a one-time 10% interest charge ($12,000), is unsecured, and matures 12 months from issuance unless earlier converted, prepaid, or accelerated.
• The Holder may convert outstanding amounts into C2 Blockchain common stock upon the earlier of (i) the company’s failure to make required amortization payments, (ii) 180 days from issuance, or (iii) registration of the underlying shares. The conversion price is 75% of the lowest closing bid during the 10 trading days prior to conversion (subject to adjustments). Amortization payments begin October 23, 2026, with monthly payments through April 23, 2027.

Key Details

• Amounts: $120,000 principal (purchase price $100,000; $20,000 original issue discount); company received $100,000 cash.
• Interest & term: One-time 10% charge ($12,000); 12-month maturity (April 23, 2027) unless converted/prepaid.
• Conversion terms: Price = 75% of lowest closing bid over prior 10 trading days; conversion allowed after 180 days or on certain triggers; Holder subject to 4.99% beneficial ownership cap (can be raised to 9.99% with 61 days’ notice).
• Other protections: Company must reserve shares equal to the greater of 5,000,000 shares or four times the shares issuable on full conversion; default can accelerate repayment to 150% of outstanding balance and give the Holder additional remedies.

Why It Matters

• This is a short-term debt financing that provides C2 Blockchain with $100,000 in immediate cash but includes conversion features that could dilute existing shareholders if converted.
• The steep discount conversion price (75% of recent trading price) and the company’s obligation to reserve a large block of shares increase the potential for meaningful dilution if conversion occurs.
• The note’s amortization schedule, conversion triggers (including automatic conversion after 180 days), and the default penalty (150% acceleration) are material terms investors should watch, as they affect the company’s near-term cash flow needs and capital structure.