8-K: American Rebel Holdings Secures New Financing

American Rebel Holdings, Inc. has entered into multiple financing agreements, including a securities purchase agreement with 1800 Diagonal Lending LLC and a note with Quick Capital, LLC, to secure working capital.

Summary

• American Rebel Holdings, Inc. has entered into a Securities Purchase Agreement with 1800 Diagonal Lending LLC, dated June 12, 2026, for a promissory note totaling $124,200.00.
• This agreement includes an Original Issue Discount of $16,200.00, resulting in net proceeds of $100,000.00.
• The company also entered into a separate agreement with Quick Capital, LLC, on June 9, 2026, for a promissory note of $155,294.12, with an Original Issue Discount of $23,294.12 and $7,000.00 in legal fees, yielding $132,000.00 in net proceeds.
• Proceeds from both agreements are designated for general working capital purposes.
• The company also engaged in equity exchanges with Streeterville, converting preferred stock and a portion of a previous note into common stock on June 15, 2026, and June 17, 2026.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative development due to the high cost of capital, significant discounts, and potential for severe dilution, despite securing necessary working capital.

Positives

• Secured new financing through agreements with 1800 Diagonal Lending LLC and Quick Capital, LLC, providing essential working capital.
• The company has the option to prepay the Quick Capital note at a discount (95% of principal) within the first six months.
• Agreements include provisions for registration rights for lenders on shares issuable upon conversion.
• The company is maintaining its corporate existence and will not sell substantially all assets without buyer consent, as per the 1800 Diagonal Lending agreement.

Negatives

• Significant original issue discounts and fees are applied to both financing agreements, reducing the net proceeds received by the company.
• The 1800 Diagonal Lending note has a substantial payback amount of $147,487.00 for a $100,000.00 net loan.
• The Quick Capital note carries a one-time interest charge of $29,117.65 on a $132,000.00 net loan.
• The 1800 Diagonal Lending note includes a default provision requiring payment of 150% of the outstanding amount plus default interest.
• The Quick Capital note also has a default provision requiring 150% of the outstanding amount plus accrued interest and fees.
• Conversion of debt to equity for 1800 Diagonal Lending occurs at a 25% discount to the market price upon an event of default.
• The company has reserved a significant number of shares (four times the issuable amount) for potential conversions, which could lead to substantial dilution.

Risks

• Potential for significant dilution to existing shareholders due to the conversion of debt into common stock at a discount, particularly upon default.
• The company's reliance on debt financing with significant discounts and fees may indicate financial strain.
• The default provisions in both notes carry substantial penalties, increasing the financial burden if the company fails to meet its obligations.
• The company's financial statements are excluded from the definition of SEC Documents due to an SEC action against its former auditor, BF Borgers, creating a lack of audited financial information.
• The company is subject to the reporting requirements of the 1934 Act, and failure to comply could be an Event of Default under the 1800 Diagonal Lending agreement.

Future Outlook

The company intends to use the proceeds from these financing agreements for general working capital purposes, including supporting American Rebel Beverages, LLC. The agreements also outline conditions for future share issuances upon conversion of debt and potential registration rights for lenders.

Industry Context

StockSavvy.ai notes that American Rebel Holdings' reliance on debt financing with significant discounts and fees, coupled with potential equity dilution, is a common strategy for companies seeking immediate capital but carries inherent risks. The company's focus on working capital suggests a need to manage operational expenses and potential growth initiatives.

Comparison to Industry Standards

• Companies in similar growth or turnaround phases often utilize convertible notes or similar debt instruments to secure funding. However, the substantial original issue discounts and conversion discounts noted in these agreements are on the higher end compared to typical market standards for established companies.
• The inclusion of default conversion at a 25% discount to market price is aggressive and suggests a higher perceived risk by the lenders, which is not uncommon for distressed or early-stage companies but is less favorable for existing shareholders.
• The reservation of four times the issuable shares for conversion is a significant commitment that could lead to substantial dilution, exceeding typical reserves for such instruments in more stable market conditions.

Legal Proceedings

• The company's financial statements are excluded from SEC Documents due to an SEC action against its former auditor, BF Borgers, impacting its ability to provide audited financial information.

Stakeholder Impact

• Shareholders: Potential for significant dilution of ownership due to debt-to-equity conversions, especially at discounted prices upon default. The company's financial health may be strained, impacting stock value.
• Creditors: The new financing agreements may impact the company's ability to service existing or future debt obligations.
• Management: Faces the challenge of managing operations and finances under potentially unfavorable debt terms and the risk of default.

Next Steps

• The company will use the proceeds for general working capital.
• The company must adhere to the repayment schedules for both the Quick Capital and 1800 Diagonal Lending notes.
• Lenders have the option to convert debt to equity under certain conditions, particularly upon default.
• The company has granted registration rights to lenders for shares issuable upon conversion.

Key Dates

Recommendation

While the company has secured much-needed working capital, the terms of the financing are unfavorable, involving significant discounts and high potential for dilution. This suggests a precarious financial position. A 'hold' recommendation reflects the immediate need for capital balanced against the long-term risks and costs associated with these agreements.

Keywords

Securities Purchase Agreement, Promissory Note, Working Capital, Debt Financing, Equity Conversion, American Rebel Holdings, 1800 Diagonal Lending, Quick Capital