SCHEDULE: Advanced Flower Capital: Tannenbaum Adjusts Stake

Leonard M. Tannenbaum, a significant shareholder, has updated his beneficial ownership in Advanced Flower Capital Inc., reflecting new share purchases, foundation holdings, and the forfeiture of stock options.

Summary

• Reporting Person Leonard M. Tannenbaum's aggregate beneficial ownership in Advanced Flower Capital Inc. has decreased by approximately 5.5 percentage points since the last Schedule 13D/A filing.
• The current aggregate beneficial ownership stands at 4,989,949 shares, representing 22.1% of the outstanding Common Stock.
• This change is a result of acquiring additional shares, including shares held by the Tannenbaum Family Foundation, and the forfeiture of 1,906,958 stock options.
• Tannenbaum acquired 330,127 shares on August 27, 2025, at an average price of $4.81 per share (range $4.56 $5.02).
• An additional 144,399 shares were purchased on August 28, 2025, at an average price of $4.57 per share (range $4.47 $4.70).
• A total of 1,906,958 stock options, with strike prices ranging from $9.53 to $12.99 and expiration dates between 2027 and 2029, were voluntarily forfeited for no value on August 28, 2025.
• The filing now includes 180,400 shares held by the Tannenbaum Family Foundation, for which the Reporting Person disclaims beneficial ownership except for his pecuniary interest.
• The beneficial ownership calculation is based on 22,594,541 shares of Common Stock outstanding as of August 13, 2025.

Sentiment

Score: 4

Explanation: While the reporting person made open market purchases, indicating some confidence, the significant forfeiture of nearly 2 million stock options for no value, with strike prices well above current purchase prices, suggests a substantial decline in the company's stock value and a negative outlook on the likelihood of those options becoming in-the-money. The net decrease in overall beneficial ownership percentage also contributes to a slightly negative sentiment.

Positives

• Reporting Person Leonard M. Tannenbaum made open market purchases of 474,526 shares of Common Stock using personal funds on August 27 and 28, 2025, indicating continued confidence in the Issuer.
• The inclusion of Tannenbaum Family Foundation shares provides a more comprehensive view of the broader Tannenbaum family's holdings, even with disclaimed beneficial ownership.

Negatives

• The aggregate beneficial ownership of Leonard M. Tannenbaum decreased by approximately 5.5 percentage points since the last filing.
• 1,906,958 stock options were voluntarily forfeited for no value, suggesting that the strike prices (ranging from $9.53 to $12.99) were significantly out-of-the-money compared to recent purchase prices ($4.56 $5.02), indicating a substantial decline in the Issuer's stock price since the options were granted.

Risks

• NA

Future Outlook

The filing primarily details past transactions and current ownership structure. It does not provide forward-looking statements or guidance from the Issuer. The Reporting Person's actions (open market purchases) suggest continued investment, but no explicit future outlook is provided.

Industry Context

This filing is a routine update of a significant shareholder's beneficial ownership and does not contain information that allows for a detailed analysis of broader industry trends or competitors. The forfeiture of options with high strike prices, however, could reflect a general downturn in the specific sector or the company's performance, making those options deeply out-of-the-money.

Related Party Transactions

• The inclusion of 180,400 shares held by the Tannenbaum Family Foundation, for which the Reporting Person serves as President and disclaims beneficial ownership except for pecuniary interest, represents a related party holding.
• The exclusion of 211,827 shares held by Ms. Robyn Tannenbaum, the Reporting Person's spouse, over which the Reporting Person disclaims beneficial ownership, also represents a related party holding.

Stakeholder Impact

• Shareholders: The decrease in overall beneficial ownership percentage by a significant insider, coupled with the forfeiture of a large number of out-of-the-money options, could be perceived negatively, potentially signaling a lack of confidence in future stock price appreciation to reach those higher strike prices. However, recent open market purchases by the insider could also be seen as a positive signal.

Key Dates

Recommendation

While the forfeiture of a large number of out-of-the-money options is a negative signal regarding past performance and future upside potential to reach those higher strike prices, the recent open market purchases by a significant insider like Leonard M. Tannenbaum, using personal funds, indicates a current belief in the company's value at its current price levels. This mixed signal suggests a "hold" recommendation, advising investors to maintain their current positions while monitoring future developments and company performance.

Keywords

Advanced Flower Capital Inc., AFC, Leonard M. Tannenbaum, Schedule 13D, Beneficial Ownership, Stock Options, Share Purchase, Common Stock, SEC Filing