Edgemode Secures $92K in Highly Dilutive Convertible Note with Punitive Terms
EDGM has more than doubled off its 52-week low of $0.001 on elevated volume (6.1× avg).
Summary
Edgemode, Inc. obtained $92,000 in net proceeds from a convertible promissory note with a $120,000 principal, featuring a deep conversion discount and severe default penalties, signaling significant financial strain.
Key Events · Financing and Capital Events · EDGM
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Secured Convertible Promissory Note
Edgemode, Inc. entered into a securities purchase agreement on March 5, 2026, for a convertible promissory note with a principal amount of $120,000, including a $20,000 Original Issue Discount.
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Net Proceeds and High Cost of Capital
The company received net proceeds of $92,000 after an $8,000 payment for the investor's legal costs. A one-time 15% interest charge was applied, resulting in a total payback of $138,000 by December 15, 2026.
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Highly Dilutive Conversion Terms
The note is convertible into common stock at 61% of the lowest closing price during the 20 trading days prior to conversion, following an event of default. This conversion mechanism is highly dilutive for existing shareholders.
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Punitive Default Penalties
Upon an event of default, the outstanding balance immediately becomes 150% of the principal, plus accrued and unpaid interest, and a 22% annual default interest. Additionally, a $2,000 per day fee is imposed if conversion shares are not delivered by the deadline.
Analysis · EDGM · Industrial Applications And Services
Edgemode, a micro-cap company, has secured additional working capital through a convertible promissory note with extremely unfavorable terms. The effective cost of capital is very high, with $92,000 in net proceeds requiring a $138,000 payback by December 2026, plus a $20,000 original issue discount. The conversion feature, triggered upon default, allows the investor to convert at a deep discount (61% of the lowest closing price over 20 days), which is highly dilutive for existing shareholders and creates a 'death spiral' risk. The punitive default penalties, including a 150% increase in principal and a $2,000 daily 'Fail to Deliver Fee,' highlight the company's distressed financial position and reliance on costly financing. This follows a similar convertible note just days prior, indicating an ongoing pattern of seeking capital under adverse conditions.
At the time of this filing, EDGM was trading at $0.01 on OTC in the Industrial Applications And Services sector, with a market capitalization of approximately $27.9M. The 52-week trading range was $0.00 to $0.11. This filing was assessed with negative market sentiment and an importance score of 8 out of 10.