Material Agreement (Form 8-K)

Item 1.01 - Entry into a Material Definitive Agreement.

On May 12, 2026, Netcapital Inc. (the "Company") entered into a Securities Purchase Agreement (the "Purchase Agreement") with Labrys Fund II, L.P., a Delaware limited partnership ("Labrys"), pursuant to which the Company issued to Labrys a promissory note in the principal amount of $290,000 (the "Note") and a common stock purchase warrant to purchase 250,000 shares of the Company's common stock, par value $0.001 per share, at an initial exercise price of $0.50 per share (the "Warrant," and together with the Note, the shares issuable upon conversion of the Note and the shares issuable upon exercise of the Warrant, the "Securities"). The Note was issued for a purchase price of $250,000 and reflects an original issue discount of $40,000. In connection with the closing, Labrys withheld $6,500 from the purchase price to cover Labrys' legal fees, $1,500 to be paid to Labrys II Management, LLC to cover due diligence costs, and $17,500 to cover fees owed by the Company to Enclave Capital LLC, a registered broker-dealer acting as placement agent.

The Note includes a one-time interest charge of 12% of the principal amount, or $34,800, earned in full as of the issue date. The Note is unsecured and matures on May 12, 2027. The Company is required to make amortization payments beginning November 12, 2026, consisting of an initial amortization payment of $162,400, followed by five payments of $27,066.66 on December 12, 2026, January 12, 2027, February 12, 2027, March 12, 2027 and April 12, 2027, with all remaining outstanding amounts due on May 12, 2027. Each amortization payment first reduces accrued and unpaid interest and then reduces the outstanding principal balance of the Note.

The Note may be prepaid at any time before the 181st calendar day following the issue date upon three Trading Days' prior written notice to the holder. The required prepayment amount is equal to the applicable prepayment percentage multiplied by the then-outstanding principal amount plus the applicable prepayment percentage multiplied by accrued and unpaid interest: 96% during the period beginning on the issue date and ending 90 calendar days after the issue date, 97% during the period beginning 91 calendar days after the issue date and ending 150 calendar days after the issue date, and 98% during the period beginning 151 calendar days after the issue date and ending 180 calendar days after the issue date. Amounts not paid when due bear default interest at the lesser of 22% per annum and the maximum amount permitted by law.

The holder may convert all or any portion of the then outstanding and unpaid principal and interest under the Note into shares of the Company's common stock on any calendar day at any time on or after the earliest of (i) the date the Company fails to pay any amortization payment when due, (ii) the date that is 180 calendar days after the issue date, or (iii) the date that any of the conversion shares are registered for the holder's resale pursuant to a registration statement or prospectus filed by the Company. The conversion price is equal to 75% of the lowest closing bid price of the common stock on the principal market during the ten trading-day period immediately preceding the applicable conversion date, subject to a floor price of $0.10 per share, subject to adjustment; provided that the floor price does not apply on or after the occurrence of an event of default under the Note.

The Note contains a beneficial ownership limitation of 4.99% of the number of shares of the Company's common stock outstanding at the time of conversion, which may be increased or decreased by the holder to any other percentage not in excess of 9.99% upon 61 days' prior written notice