Business Context and Reporting Period
Company: Know Labs, Inc. (Note: Request metadata listed "USBC, Inc." but the filing text identifies the registrant as Know Labs, Inc.)
Filing Type: Form 8-K (Current Report)
Date of Report: June 5, 2025
Event: Entry into a Material Definitive Agreement for a private placement and potential change of control.
Key Financial Metrics and Transaction Terms
This filing details a proposed private placement rather than standard periodic financial results. Key transaction metrics include:
- Purchase Price: Composed of 1,000 Bitcoin plus a cash amount between $12 million and $15 million.
- Share Issuance Price: $0.335 per share of Common Stock.
- Transaction Fee: The financial advisor (J.V.B Financial Group, LLC) will receive Fee Shares equal to 2% of the post-closing Company Common Stock.
- Support Agreements: Stockholders holding approximately 37% of total voting power have agreed to vote in favor of the transaction.
Note: The filing does not provide current revenue, profit, cash flow, or debt figures for the company. These metrics are not disclosed in this specific 8-K report.
Material Changes and Conditions
The transaction represents a material change in corporate structure and ownership. Closing is subject to numerous conditions, including:
- Approval of the transaction and related charter amendments by Company stockholders.
- Conversion of all Series C and Series D Convertible Preferred Stock into Common Stock.
- Termination of certain Company contracts and liens.
- Repayment of "Closing Indebtedness."
- Amendments to certain employment agreements and lease terms.
- Listing of Common Stock on the NYSE American LLC without suspension.
Outlook, Risks, and Management Commentary
Management Actions:
- Peter Conley: Employment term to terminate automatically upon consummation of the transaction.
- Ronald Erickson (CEO): Annual base salary reduced from $500,000 to $375,000 effective upon closing. The transaction will not constitute a "Change of Control" for his employment agreement.
Risks and Contingencies:
- Termination Rights: The agreement may be terminated if closing does not occur by October 3, 2025, if stockholder approval is not obtained, or if trading is suspended.
- Bitcoin Volatility: The company highlights risks related to fluctuations in Bitcoin market price and potential impairment charges.
- Regulatory and Operational Risks: Includes uncertainties in interest rates, regulatory environment changes, and the ability to access capital.
Investor Verification Checklist
- Verify the final valuation of the 1,000 Bitcoin component at the time of closing.
- Confirm the outcome of the upcoming stockholder meeting regarding the charter amendment and director elections.
- Review the definitive proxy statement (Schedule 14A) for detailed risk factors and related party transactions.
- Monitor the status of the conversion of Series C and Series D Preferred Stock.
- Check for any updates regarding the repayment of Closing Indebtedness and termination of liens.