RYTHM, Inc. Amends Convertible Notes & Warrants; Shareholders Approve

What Happened

• RYTHM, Inc. (RYM) filed an 8-K on August 11, 2026 reporting that at a Special Meeting on August 10, 2026 shareholders approved issuing common stock to holders of certain convertible promissory notes and warrants and under a shared services agreement (per Nasdaq Rule 5635).
• The company entered into an amendment (the “Amendment”) with RSLGH, LLC (a Green Thumb Industries subsidiary) and Vision Management Services, LLC (VMS) that will, effective October 10, 2026, remove all beneficial ownership limitations on (i) conversion of secured convertible notes, (ii) exercise of existing pre-funded warrants, and (iii) exercise of certain pre-funded warrants that may be issued in the future under the amended agreements.

Key Details

• Notes: secured convertible notes held by RSLGH had an original principal amount of $72.0 million.
• Warrants: pre-funded warrants held by RSLGH cover up to 9,731,638 shares of common stock.
• Vote: Of 2,179,128 shares outstanding and eligible to vote (record date June 26, 2026), 1,128,854 shares (≈51.8%) were represented; the issuance proposal passed 1,118,058 for / 10,049 against / 747 abstained.
• Related parties: Benjamin Kovler (RYTHM Chairman & Interim CEO) is also Chair & CEO of Green Thumb; director Armon Vakili is employed by Green Thumb. The Amendment is filed as Exhibit 10.1.

Why It Matters

• Removing beneficial ownership limits lets the note- and warrant-holder(s) convert or exercise securities without the prior caps that could have restricted their ownership percentage. That can lead to issuance of new RYTHM shares and dilution of existing shareholders if conversions/exercises occur.
• The shareholder approval under Nasdaq rules clears the company to issue the shares tied to these instruments; investors should watch for future conversions or exercises (and any subsequent filings) that will show actual dilution, changes in ownership stake, or potential impacts on control.