SharonAI Holdings Inc. 10-Q

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds On: (i) June 11, 2026, SharonAI Holdings Inc. (the “Company”) issued 8,430,784 shares of its Class A Ordinary Common Stock, par value $0.0001 per share (collectively, the “Conversion Shares”) upon conversion of an aggregate principal amount of approximately US$103.6 million of unsecured, redeemable, convertible notes (the “AUS Notes”), together with US$2.08 million of accrued and unpaid interest thereon pursuant to the terms of that certain Convertible Note Agreement (the “Convertible Note Agreement”), dated December 19, 2025, by and among SharonAI, Inc., SharonAI Pty Ltd and certain investors (the “Noteholders”), as previously reported on the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 22, 2025. The Company assumed the obligations of SharonAI, Inc. under the Convertible Note Agreement promptly following the closing of the Business Combination Agreement, dated January 28, 2025. The number of Conversion Shares issued upon conversion of the AUS Notes was calculated in accordance with the conversion formula set forth in Section 4.6 of the Convertible Note Agreement, based on the sum of the principal amount and accrued interest divided by the lower of (i) the applicable Discount Rate multiplied by the relevant transaction price and (ii) the Valuation Cap (each as defined in the Convertible Note Agreement). The conversion price per share was US$12.53. In connection with conversion of the AUS Notes, the Company agreed to register the Conversion Shares for resale on an S-1 registration statement. The Conversion Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and were issued in reliance on applicable exemptions from registration pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506(b) of Regulation D promulgated thereunder, and/or Regulation S, based on representations made by the holders of the AUS Notes, including that the holders are accredited investors acquiring the Conversion Shares for investment purposes and not with a view to distribution, and that certain of the holders of AUS Notes are not U.S. persons. The Conversion Shares may not be offered or sold in the United States absent registration under the Securities Act or an applicable exemption from such registration requirements. On April 22, 2026, the Company issued 90,893 shares of its Class A Ordinary Common Stock to Inbocalupo Pty Ltd (as trustee for the Inbocalupo Trust) in consideration for, and as full and final satisfaction of, the Company’s reimbursement obligation arising under the reimbursement provisions of the Independent Contractor Agreement dated October 14, 2024. The issuance of the shares of Class A Ordinary Common Stock was made in reliance on the exemption from registration under the Securities Act afforded by Section 4(a)(2) and/or Rule 506 promulgated thereunder. Dividend Restrictions Pursuant to Section 5.14 of each of the Company’s (i) the May 2026 Indenture governing the 6% Convertible Senior Notes due 2031 and (ii) June 2026 Indenture governing 4.75% Convertible Senior Notes due 2032 for so long as any portion of the Notes remains outstanding, the Company is prohibited from paying cash dividends or distributions on any equity securities of the Company, unless the Required Holders (as defined in each of the May 2026 Indenture and the June 2026 Indenture, being the holders of at least a majority in aggregate principal amount of the 4.75% Notes due 2032 and the 6.00% Notes due 2031, as applicable, then outstanding) shall have otherwise given prior written consent. Item 3. Defaults Upon Senior Securities None. Item 4. Mine Safety Disclosures Not applicable. - 40 -