FARMHOUSE, INC. /NV 8-K

What Happened

• Farmhouse, Inc. (FMHS) announced on May 4, 2026 that it entered into a Securities Purchase Agreement with Axiom Holdings Group LLC and issued a senior unsecured convertible promissory note with an original principal amount of $2,222,222 (reflecting $2,000,000 after a 10% original issue discount). The aggregate consideration was $2,000,000 (comprised of $1,000,000 cash and $1,000,000 in digital assets); the company previously received a $100,000 advance that was applied at closing. Net cash received at closing was $884,000 after repayment of the advance and payment of $16,000 of investor legal expenses.
• The Note bears interest at 15% per year, matures in 10 months unless earlier converted, and includes automatic conversion upon certain events. The company also agreed to file a registration statement within 90 days to cover resale of shares issuable on conversion.

Key Details

• Note principal: $2,222,222 (10% original issue discount → $2,000,000 economic consideration).
• Cash/digital split: $1,000,000 cash + $1,000,000 digital asset consideration; net cash at closing = $884,000 after adjustments.
• Interest & term: 15% per annum; 10‑month maturity unless converted earlier.
• Conversion mechanics: conversion price = 75% of the lowest VWAP over the 20 trading days preceding conversion, subject to a floor of $0.15/share and a cap of $0.50/share; company must reserve 200% of the maximum shares issuable at the minimum price.
• Other terms: customary reps/warranties, most‑favored‑nation provisions, limits on certain future financings, resale volume limitations for the investor, and change‑of‑control cash repayment option (unless investor elects conversion).

Why It Matters

• This is a short‑term financing that provides immediate cash and digital asset resources but creates a convertible obligation that can convert into equity, which would dilute existing shareholders if conversion occurs.
• The conversion price formula (75% of lowest VWAP with $0.15–$0.50 bounds) and the company’s requirement to reserve twice the maximum potential shares highlight the potential magnitude of dilution. The company’s commitment to file a resale registration statement within 90 days affects how and when converted shares could be sold publicly.