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Cannabis technology company Agrify converted roughly $13.8 million in debt to equity to regain compliance with Nasdaq’s stock listing rules.
CP Acquisitions, an entity controlled by Agrify Chair and CEO Raymond Chang and board member I-Tseng Jenny Chan, converted $11.5 million of its senior convertible notes into a prefunded warrant exercisable for up to approximately 8.6 million shares of common stock, according to a news release.
GIC Acquisitions, an entity controlled by Chang, converted $2.29 million of its junior secured notes into a prefunded warrant exercisable for up to around 3.2 million shares of common stock.
The prefunded warrants could be subject to adjustment provisions if Agrify does any equity financing during the 12 months after the conversions, subject to shareholder approval.
The conversions mean that shareholder equity in Agrify will exceed $2.5 million, which will allow the company to regain compliance on the Nasdaq exchange, where the company trades as AGFY.
“The decision to convert a substantial portion of the senior debt shows the management and the shareholders’ commitment to the future of Agrify,” Chang said in a statement.
Earlier this week, citing “unfavorable conditions,” Agrify canceled its plan to acquire ag-tech firm Nature’s Miracle.
