Agrify Stock Plummets On Agreement To Raise Up To $1.84M From The Exercise Of Previously Issued Common Stock Warrants

Agrify Corporation AGFY has entered into warrant inducement letters to raise up to $1.84 million in gross proceeds from the exercise of 10.65 million common stock warrants issued in the company’s public offering from December, 2022, or the existing warrants.

On April 18, 2023, the company reduced the exercise price of all the existing warrants from $0.65 per share to $0.1725 per share. On such date, Agrify also entered into warrant inducement offer letters with certain investors pursuant to which the investors’ may exercise 10.65 million existing warrants at the reduced exercise price of $0.1725, and the company will issue to such investors new warrants to purchase 200% of the shares exercised pursuant to the existing warrants from April 18, 2023 to 9:00am on April 21, 2023.

Such new warrants will become exercisable six months after issuance, have an exercise price of $0.1725 and a five year term from their initial exercise date, which will, among other things, be reduced to the extent the company issues securities for a lower purchase price, subject to certain exceptions and substantially consistent with the equivalent term in the existing warrants. Additionally, if the exercise of the existing warrants by the warrantholder would cause the warrantholder to exceed the beneficial ownership limitation in the warrant agreement for the existing warrants, the company will, among other things, only issue such number of existing warrants to the warrantholder that would not cause the warrantholder to exceed the maximum number of shares of common stock permitted, with the balance to be held in abeyance until such shares can be delivered to the holder within such beneficial ownership limitations. If all are exercised, the exercise of the 10.65 million existing warrants is expected to result in gross proceeds to the company of $1.84 million.

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