Company: FMHS
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001096906-25-001826
Chunk: 5

Company: FARMHOUSE, INC. /NV
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 5
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 and its members for a proposed acquisition of all membership interests of Thrown, a beverage company whose initial product is Good Game by T-Pain, a nootropic functional esports beverage. Pursuant to the SEA, the Company issued187,500shares to Thrown as an equity deposit at an agreed value of $75,000. The fair market value of the stock on the issuance date, based on the closing price on the OTCQB market, was $0.1396 per share, or approximately $26,175.

Because the closing conditions had not been satisfied as of September 30, 2025, control of Thrown had not transferred under ASC 805. Therefore, the Company recorded the fair value of the shares issued as a Deposit for Investment. This deposit represents an advance made in anticipation of completing the acquisition. As of the date of this report, the transaction had not closed and discussions with Thrown management regarding closing conditions remain ongoing. If the transaction does not close, the shares will be treated as a break-up fee and charged to expense.

NOTE 4 - CONVERTIBLE NOTES PAYABLE, IN DEFAULT

Convertible notes payable is comprised of a promissory note issued to an unrelated individual with a principal amount of $45,000as of September 30, 2025 and December 31, 2024. Principal and accrued interest were originally due in July 2018, and the note is currently in default. The note bears interest at a rate of18% per annum, accrues monthly, and is unsecured.

The note, together with all unpaid accrued interest, is automatically convertible in full upon the closing of a qualified financing. A qualified financing is defined as an equity financing resulting in gross proceeds to the Company of at least $750,000 (including the conversion of this note and other debt). Upon a qualified financing, the conversion price would be equal to 100% of the per share price paid by investors in the financing, subject to the following valuation adjustments: (i) if the Company’s valuation associated with the qualified financing is less than $15,000,000, the conversion price shall be based on a $15,000,000 valuation; and (ii) if the valuation exceeds $30,000,000, the conversion price shall be based on a $30,000,000 valuation.

Interest expense related to the convertible note was $6,058and $6,082for the nine months ended September 30, 2025 and 2024, respectively, and $