BRAINSTORM CELL THERAPEUTICS INC. 8-K

What Happened
Brainstorm Cell Therapeutics Inc. announced it entered into three separate securities purchase transactions on Dec 31, 2025, Jan 5, 2026 and Jan 6, 2026, issuing three promissory notes to institutional investors to raise short‑term financing. The transactions produced roughly $82,000 from Vanquish Funding Group Inc. (note principal $94,300 with $12,300 original issue discount), about $80,000 net from Quick Capital, LLC (note principal $94,875 with $12,500 OID), and approximately $126,000 cash proceeds from Auctus Fund, LLC (note principal $140,000 with $14,000 OID, before fees/costs). The notes are unsecured, carry one‑time interest charges (10–12%), have maturities of about 10–12 months (Vanquish matures Oct 30, 2026; the others ~12 months), include scheduled amortization, and contain conversion features and default remedies.

Key Details

• Total principal issued: $329,175 (Vanquish $94,300; Quick $94,875; Auctus $140,000); aggregate net cash proceeds roughly $288,000 before fees and costs.
• Conversion pricing: Vanquish/Auctus convertible at 65% of lowest trading price over a look‑back period (10 or 15 trading days); Quick convertible at 75% of lowest trading price over a 20‑day look‑back; all conversions subject to a 4.99% beneficial ownership cap.
• Default penalties and remedies: customary events of default; default payment equal to 150% of outstanding amounts (rising to 175% in certain cases for Vanquish); liquidated damages for delayed share delivery.
• Additional terms: Vanquish agreement contemplates additional tranches up to $2.0M by further agreement; Auctus includes piggy‑back registration rights, most‑favored‑nation and other protections, and a right to apply up to 50% of certain future financings toward repayment above a $500K threshold.

Why It Matters
This 8‑K shows Brainstorm obtained near‑term cash via convertible note financings rather than registered equity offerings. For investors, key implications are the short maturities and the presence of conversion features at steep discounts to market (65–75%), which could lead to significant dilution if conversion occurs. The 4.99% ownership cap limits immediate share issuance per holder but does not eliminate dilution over time or across multiple investors. The Vanquish agreement also contemplates additional funding capacity (up to $2M) subject to agreement, which could materially affect future capital structure. All notes were sold under exemptions (Section 4(a)(2) / Rule 506) to accredited investors.