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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported): May 12, 2026
NETCAPITAL
INC.
(Exact
name of registrant as specified in charter)
| Utah |
|
001-41443 |
|
87-0409951 |
(State or other jurisdiction of
incorporation) |
|
(Commission
File
Number) |
|
(IRS
Employer
Identification
No.) |
| 1
Lincoln Street, Boston, Massachusetts |
|
02111 |
| (Address
of principal executive offices) |
|
(Zip
Code) |
Registrant’s
telephone number, including area code: (781) 925-1700
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions (see General Instruction A.2. below):
| ☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| |
|
| ☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
| Title
of each class |
|
Trading
symbol(s) |
|
Name
of each exchange on which registered |
| Common
Stock, $0.001 par value per share |
|
NCPL |
|
The
Nasdaq Stock Market LLC |
| Warrants
exercisable for one share of Common Stock |
|
NCPLW |
|
The
Nasdaq Stock Market LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1934 (§240.12b-2
of this chapter)
Emerging
growth company ☐.
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01 – Entry into a Material Definitive Agreement.
On
May 12, 2026, Netcapital Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”)
with Labrys Fund II, L.P., a Delaware limited partnership (“Labrys”), pursuant to which the Company issued to Labrys a promissory
note in the principal amount of $290,000 (the “Note”) and a common stock purchase warrant to purchase 250,000 shares of the
Company’s common stock, par value $0.001 per share, at an initial exercise price of $0.50 per share (the “Warrant,”
and together with the Note, the shares issuable upon conversion of the Note and the shares issuable upon exercise of the Warrant, the
“Securities”). The Note was issued for a purchase price of $250,000 and reflects an original issue discount of $40,000. In
connection with the closing, Labrys withheld $6,500 from the purchase price to cover Labrys’ legal fees, $1,500 to be paid to Labrys
II Management, LLC to cover due diligence costs, and $17,500 to cover fees owed by the Company to Enclave Capital LLC, a registered broker-dealer
acting as placement agent.
The
Note includes a one-time interest charge of 12% of the principal amount, or $34,800, earned in full as of the issue date. The Note is
unsecured and matures on May 12, 2027. The Company is required to make amortization payments beginning November 12, 2026, consisting
of an initial amortization payment of $162,400, followed by five payments of $27,066.66 on December 12, 2026, January 12, 2027, February
12, 2027, March 12, 2027 and April 12, 2027, with all remaining outstanding amounts due on May 12, 2027. Each amortization payment first
reduces accrued and unpaid interest and then reduces the outstanding principal balance of the Note.
The
Note may be prepaid at any time before the 181st calendar day following the issue date upon three Trading Days’ prior written notice
to the holder. The required prepayment amount is equal to the applicable prepayment percentage multiplied by the then-outstanding principal
amount plus the applicable prepayment percentage multiplied by accrued and unpaid interest: 96% during the period beginning on the issue
date and ending 90 calendar days after the issue date, 97% during the period beginning 91 calendar days after the issue date and ending
150 calendar days after the issue date, and 98% during the period beginning 151 calendar days after the issue date and ending 180 calendar
days after the issue date. Amounts not paid when due bear default interest at the lesser of 22% per annum and the maximum amount permitted
by law.
The
holder may convert all or any portion of the then outstanding and unpaid principal and interest under the Note into shares of the Company’s
common stock on any calendar day at any time on or after the earliest of (i) the date the Company fails to pay any amortization payment
when due, (ii) the date that is 180 calendar days after the issue date, or (iii) the date that any of the conversion shares are registered
for the holder’s resale pursuant to a registration statement or prospectus filed by the Company. The conversion price is equal
to 75% of the lowest closing bid price of the common stock on the principal market during the ten trading-day period immediately preceding
the applicable conversion date, subject to a floor price of $0.10 per share, subject to adjustment; provided that the floor price does
not apply on or after the occurrence of an event of default under the Note.
The
Note contains a beneficial ownership limitation of 4.99% of the number of shares of the Company’s common stock outstanding at the
time of conversion, which may be increased or decreased by the holder to any other percentage not in excess of 9.99% upon 61 days’
prior written notice
The
Warrant is exercisable, in whole or in part, at any time on or after November 12, 2026 and on or before 5:00 p.m. New York City time
on May 12, 2029. The exercise price is $0.50 per share, subject to adjustment for stock dividends, stock splits, combinations, reclassifications
and similar events. If, at the time of exercise, there is no effective registration statement registering, or the prospectus contained
therein is not available for, the resale of the warrant shares by the holder, the Warrant may be exercised on a cashless basis. The Warrant
contains a 4.99% beneficial ownership limitation, which the holder may increase or decrease upon notice to the Company, provided that
the limitation may not exceed 9.99% and any increase is not effective until the 61st day after notice. The Warrant also includes customary
provisions relating to delivery of warrant shares, buy-in compensation for failure to timely deliver shares, pro rata distributions,
purchase rights, fundamental transactions, transferability and amendment.
The
Purchase Agreement provides that the Company will use the proceeds for business development and general working capital, subject to certain
restrictions. The Purchase Agreement and the Note contain customary and transaction-specific covenants, including transfer agent instructions,
legal counsel opinion provisions, public information covenants, piggy-back registration rights, a requirement to purchase directors’
and officers’ insurance within 60 calendar days after closing, restrictions on certain capital stock distributions and asset sales,
and registration-statement-related default provisions. The Note provides that an event of default occurs if the Company fails to file
a registration statement covering the holder’s resale of all conversion shares and warrant shares within 60 calendar days after
the issue date, fails to cause such registration statement to become effective within 120 calendar days after the issue date, fails to
keep the registration statement effective, or fails to amend or file a new registration statement if there are no longer sufficient shares
registered for resale.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The
information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item
3.02 Unregistered Sales of Equity Securities.
The
Securities were offered and sold in a private placement in reliance upon the exemption from registration provided by Section 4(a)(2)
of the Securities Act of 1933, as amended, and Rule 506(b) of Regulation D promulgated thereunder. Labrys represented that it is an accredited
investor and acquired the Securities for investment purposes. The Company did not use general solicitation or general advertising in
connection with the offering. Enclave Capital LLC acted as placement agent in connection with the transaction, and $17,500 was withheld
from the purchase price to cover fees owed by the Company to the placement agent.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
| Exhibit
No. |
|
Description |
| |
|
|
| 4.1 |
|
Convertible Promissory Note, dated May 12, 2026, issued by Netcapital Inc. to Labrys Fund II, L.P. |
| 4.2 |
|
Common Stock Purchase Warrant, dated May 12, 2026, issued by Netcapital Inc. to Labrys Fund II, L.P. |
| 10.1 |
|
Securities Purchase Agreement, dated May 12, 2026, by and between Netcapital Inc. and Labrys Fund II, L.P. |
| 104 |
|
Cover
Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
| |
Netcapital
Inc. |
| |
(Registrant) |
| |
|
|
| |
By: |
/s/
Todd Violette |
| |
Name: |
Todd
Violette |
| |
Title: |
Chief
Executive Officer |
| Dated:
May 18, 2026 |
|
|
