Fusemachines Inc. Announces $2.05M Convertible Note Financing

What Happened

• Fusemachines Inc. announced on Aug. 2, 2026 that it entered a Securities Purchase Agreement with affiliates of Meteora Capital Partners. The company sold an Original Issue Discount (OID) senior unsecured convertible promissory note with $2,500,000 original principal (purchase price $2,050,000, 18% OID) and issued a warrant to buy up to 2,050,000 common shares. The note matures Feb. 12, 2027 and is convertible at the holder’s option at a fixed price of $4.20 per share. The company filed a press release on Aug. 4, 2026 announcing the terms.

Key Details

• Note original principal: $2,500,000; purchase price paid: $2,050,000 (18% original issue discount).
• Conversion and warrant pricing: fixed conversion price $4.20 per share; Warrant to purchase up to 2,050,000 shares at $4.20 per share.
• Maturity: Feb. 12, 2027. Note is senior, unsecured, convertible at holder’s option; no ratchets, resets, or variable pricing.
• Company must file a Form S-1 or S-3 to register for resale the shares issuable on conversion/exercise. The transaction required amendments to Fusemachines’ existing Forward Purchase Agreement and Shortfall Warrants with Meteora.

Why It Matters

• This filing creates a new short-term debt obligation and results in an unregistered sale of securities (the note and warrants) to a single investor group, which can dilute current shareholders if conversion or warrant exercises occur.
• The financing provides immediate cash of $2.05M but at an 18% discount and with conversion/warrant terms that could issue up to 2,050,000 new shares at $4.20, so investors should watch registration progress (S-1/S-3) and any future conversions or warrant exercises that affect share count and capital structure.