Business Context and Reporting Period
This Form 8-K, dated August 6, 2025, reports the closing of a private placement and a change in control for Know Labs, Inc., which has officially changed its name to USBC, Inc. (Trading Symbol: USBC). The company is transitioning into a multi-disciplinary enterprise with a focus on digital assets. The filing details the issuance of approximately 357.8 million shares to Goldeneye 1995 LLC, resulting in the buyer acquiring approximately 81% of the company on a fully diluted basis.
Key Financial Metrics and Capital Structure
- Capital Raised: The company received a purchase price consisting of 1,000 Bitcoin and $15 million in cash.
- Share Issuance: Approximately 357.8 million shares of Common Stock were issued to the Buyer at a price of $0.335 per share.
- Debt Repayment: The company repaid all outstanding debt obligations in full on the Closing Date:
- Lind Promissory Note: Repaid $2,354,625 in cash.
- Struve Loan Documents: Repaid $75,000 in cash; remaining interest and principal obligations satisfied via the issuance of 3,295,379 shares of Common Stock.
- Preferred Stock Conversions/Redemptions:
- Series C and Series D Preferred Stock were converted into an aggregate of 8,333,440 shares of Common Stock.
- Series H Preferred Stock was redeemed via a combination of $654,276.15 in cash and 2,000,000 shares of Common Stock.
- Asset Management Fees: The company entered an agreement with Hyrcanian Asset Management, LLC, agreeing to pay a 1% annual management fee and a 25% performance fee on net realized gains, payable in Bitcoin.
Material Changes Versus Prior Period
- Change in Control: Goldeneye 1995 LLC (managed by Robert Gregory Kidd) now controls approximately 81% of the company.
- Corporate Identity: The company name changed from Know Labs, Inc. to USBC, Inc., and the ticker symbol changed to "USBC" on the NYSE American.
- Authorized Capital: The number of authorized shares of Common Stock was increased from 7,500,000 to 750,000,000.
- Debt Elimination: All previously outstanding convertible notes and debentures (Lind and Struve) have been terminated and satisfied.
- Executive Leadership:
- Robert Gregory Kidd appointed as CEO, President, and Chairman.
- Ronald P. Erickson transitioned from CEO to President of the Science Division/Senior Vice President.
- Peter J. Conley ceased employment as CFO; Kitty Payne appointed as new CFO.
- Kirk Chapman appointed as COO.
Guidance, Outlook, and Risks
Outlook and Strategy: The company is pivoting to a multi-disciplinary enterprise model with a specific "Bitcoin treasury strategy." The new management team, including the CEO and COO, brings significant experience in banking, payments, and digital assets. The company has engaged Hyrcanian Asset Management to manage its Bitcoin holdings using an options strategy.
Risks and Contingencies:
- Bitcoin Volatility: The company's financial condition is now materially exposed to fluctuations in the market price of Bitcoin, including potential unrealized losses.
- Regulatory Environment: Risks related to the evolving regulatory landscape for digital assets and securities laws.
- Profitability: No assurance is given regarding the company's ability to achieve or maintain future profitability.
- Accounting Treatment: Risks associated with changes in the accounting treatment of Bitcoin holdings.
Unusual Items: The transaction involved a significant portion of the purchase price paid in Bitcoin (1,000 BTC) rather than solely cash. Additionally, the CEO (Robert Gregory Kidd) has an employment agreement with a base salary of $1 per annum, relying on equity and bonuses for compensation.
Investor Verification Checklist
- Verify the current market valuation of the 1,000 Bitcoin held by the company and the impact of price volatility on the balance sheet.
- Confirm the exact number of fully diluted shares outstanding post-closing to validate the 81% ownership stake of the new controlling shareholder.
- Review the "Risk Factors" exhibit (Exhibit 99.2) for specific details on regulatory compliance regarding the new digital asset strategy.
- Examine the vesting schedules and exercise prices ($2.45) of the 13.69 million stock options granted to new executives (Payne, Chapman, Jenkinson).
- Confirm the effective date of the ticker symbol change to "USBC" on the NYSE American (scheduled for August 15, 2025).