Newton Golf Company, Inc. 8-K

What Happened Newton Golf Company, Inc. filed an 8‑K disclosing a securities purchase agreement to issue up to $2.0 million of unsecured convertible promissory notes and accompanying warrants. The company completed a first closing on March 16, 2026, issuing a $500,000 convertible note and a warrant for 50,000 shares to entities affiliated with director Brett Hoge, and received $500,000 in cash proceeds. The financing was structured to comply with Nasdaq rules for issuances to directors without stockholder approval.

Key Details

• First closing: March 16, 2026 — $500,000 convertible note issued and $500,000 cash received; 50,000 warrant shares issued.
• Total authorized issuance: up to $2,000,000 in aggregate principal of Convertible Notes across one or more closings.
• Note terms: 18‑month maturity, 10% annual interest paid in kind (PIK), convertible into common stock at purchasers’ option. Outstanding principal and unpaid interest convert at maturity into shares at $1.60 per share (subject to adjustment).
• Warrants: exercisable at $1.75 per share (subject to adjustment), expire in five years; warrants issued equal to principal/10 (e.g., $500K → 50,000 warrants). Purchasers are affiliated with a Company director.
• Other provisions: Company may prepay notes any time without penalty; default interest rate is 20% per annum; holders have repayment or conversion options on a change of control; Company agreed to seek piggyback registration for resale of conversion and warrant shares.

Why It Matters This transaction provides immediate cash ($500K received so far) and access to up to $2.0M in financing, which can support operations or liquidity needs. Investors should note potential dilution risk from conversion of the notes and exercise of warrants (conversion price $1.60; warrant exercise $1.75), and that the initial purchasers are affiliated with a director — a related‑party transaction disclosed and structured to comply with Nasdaq rules. The notes increase the company's near‑term liabilities but are convertible, which could reduce cash repayment obligations if converted to equity.