AMERICAN REBEL HOLDINGS INC 8-K

What Happened

• On December 15, 2025, American Rebel Holdings Inc. announced it entered into Securities Purchase Agreements for two short‑term loans: a $152,950 promissory note with 1800 Diagonal Lending, LLC and an $86,250 promissory note with Boot Capital LLC. After original‑issue discounts and fees, the Company received $125,000 (1800) and $75,000 (Boot) — $200,000 total net proceeds — intended for general working capital and to fund American Rebel Beverages operations.
• Repayment schedules begin June 15, 2026 (large initial payments) with ten scheduled payments through March 15, 2027. Both notes include conversion rights that become exercisable only upon an event of default and a significant default penalty provision.

Key Details

• 1800 Note: principal $152,950; original issue discount $19,950; fees $8,000; net proceeds $125,000; total scheduled payback $181,628. First payment $90,814 due June 15, 2026, then monthly payments through March 15, 2027.
• Boot Note: principal $86,250; original issue discount $11,250; net proceeds $75,000; total scheduled payback $102,421. First payment $51,210.50 due June 15, 2026, then monthly payments through March 15, 2027.
• Default/conversion terms: upon an Event of Default, each note becomes immediately due; the Company would owe 150% of (outstanding principal + accrued interest) plus default interest (22% per annum) and any conversion amounts. On default, lender may convert unpaid principal into restricted common shares at a 25% discount to market price, but conversion is capped at <4.99% of outstanding common stock. The Company must reserve shares equal to four times the potential conversion amount.
• Covenant/other financing: Company reviewed its existing Streeterville financing agreement and believes both notes fall within permitted working‑capital carve‑outs (1800 series cap $800,000; ARB working‑capital cap $1.5M) and therefore do not breach Restricted Issuances.
• Unregistered issuance: On December 9, 2025, the Company issued 25,000 shares of Series D Convertible Preferred Stock to a strategic advisor for services (through Sept 30, 2027); all such securities were issued in transactions exempt from registration and are restricted.

Why It Matters

• These transactions increase short‑term indebtedness but provided $200,000 of immediate cash to fund operations and the beverage unit. Investors should note the repayment schedule begins mid‑2026 with substantial initial payments, so near‑term cash flow will be important.
• Conversion is limited and only available on default, which reduces immediate dilution risk; however, the notes carry steep default consequences (150% multiplier and 22% default interest), making defaults very costly. The Company’s assertion that the notes comply with prior Streeterville covenants is material — any covenant dispute could affect financing flexibility.
• Retail investors should monitor cash burn, the Company’s ability to make the scheduled June 2026 payments, and any future disclosures about covenant waiver requests or additional financings that could affect capitalization or liquidity.