Mag Magna Corp 8-K

What Happened
Mag Magna Corp (MGNC) announced on February 25, 2026 that it entered an Equity Purchase Agreement with Monroe Street Capital Partners, LP giving the company the right to sell up to $30,000,000 of common stock to Monroe over a commitment period. As consideration the company issued 15,000 initial commitment shares and will issue additional shares upon each $2,500,000 drawn. Concurrently, Mag Magna issued two convertible promissory notes (to Monroe and to Lambda Ventures) dated Feb 25–27, 2026: each note shows $91,292.40 principal, $85,530 net proceeds after a $6,762.40 original issue discount, bears 10% annual interest, matures in 12 months, and is convertible into common stock; each investor also received a five‑year warrant to buy 40,575 shares.

Key Details

• Equity facility: up to $30,000,000 maximum commitment; Company may deliver Put Notices to sell shares during the Commitment Period beginning Feb 25, 2026.
• Pricing/limits: each Put must be at least $25,000 and no more than the lesser of $500,000 or 200% of the 7‑day Average Daily Trading Value; purchase price is 80% of specified low traded prices on the Principal Market.
• Consideration & registration: 15,000 Initial Commitment Shares issued; additional “Fulfillment Commitment Shares” issued for every $2,500,000 drawn (formula based on VWAP); Company must file a registration statement covering resale of these shares within 30 days and use commercially reasonable efforts to have it effective within 90 days.
• Notes & warrants: two notes (Monroe and Lambda) — $91,292.40 principal each / $85,530 cash proceeds each (OID $6,762.40); 10% interest (first 12 months’ interest $7,303.39 earned up front); conversion price = lesser of $1.50 or 70% of lowest traded price 15 trading days prior; 4.99% beneficial ownership cap; $1,750 fee deducted on each conversion; five‑year warrants to purchase 40,575 shares each.

Why It Matters
These agreements provide near‑term capital and a $30M equity financing capability but also create potential dilution: Monroe can purchase shares under the equity line and both note conversions and warrants can increase share count. The registration rights mean Monroe’s acquired shares are intended to be registered for resale (filed within 30 days, effective within 90 days), which could increase tradable supply once effective. The short-term notes are relatively expensive financing (OID plus guaranteed up‑front interest) and include conversion limits, reserved‑share requirements and restrictive covenants that could affect corporate flexibility. Investors should monitor future draw notices, the registration statement filing/effectiveness, any conversions or warrant exercises, and subsequent disclosures about dilution and use of proceeds.