ARTELO BIOSCIENCES, INC. 8-K

What Happened
Artelo Biosciences, Inc. (ARTL) announced on January 30, 2026 that it entered into an Equity Purchase Agreement with Square Gate Capital Master Fund, LLC – Series 5. Under the agreement Artelo can direct Square Gate to purchase up to $25 million of common stock (an initial commitment), with an option to increase to a $50 million maximum commitment if the initial amount is exhausted. Artelo issued 292,398 "Commitment Shares" (or pre-funded warrants) to Square Gate valued at $500,000 as consideration, and agreed to pay up to $35,000 of Square Gate’s customary fees.

Key Details

• Agreement date: January 30, 2026; term ends on the earlier of (i) purchase of the maximum commitment, (ii) January 30, 2029, or (iii) certain termination events.
• Initial Commitment Amount: $25.0 million; Company may increase by an additional $25.0 million (Maximum Commitment Amount $50.0 million).
• Upfront consideration: 292,398 Commitment Shares valued at $500,000 (shares and/or pre-funded warrants). Company also responsible for up to $35,000 in due diligence/legal fees.
• Share sale mechanics: Company may deliver Put Notices to sell portions (Regular Put Amount up to limits tied to trading volume and a $500,000 cap). Purchase price = 95% of the lowest daily VWAP during valuation periods; intraday sales subject to additional limits.
• Ownership and issuance caps: Aggregate sales under the facility cannot exceed 19.99% of outstanding shares without shareholder approval (or until average sale price ≥ $1.71); Square Gate’s beneficial ownership capped at 4.99% unless waived.
• Registration: Artelo must file a registration statement within 30 days and have it declared effective within 60 days to register resale of all issuable shares.

Why It Matters
This agreement gives Artelo a committed equity financing source that can provide up to $25M immediately available (and potentially up to $50M) to fund operations, research, or other needs without negotiating separate financings each time. For investors, it also means potential dilution as shares can be sold into the market (and sold at a discount to recent trading prices—95% of certain VWAP measures). The registration requirement means those shares are intended to be freely resellable once effective. Ownership and issuance caps and the 4.99% beneficial ownership limit moderately restrict concentration risk from this single investor.