Form 4: Agrify Corp: RSLGH, LLC Receives Pre-Funded Warrants in Lieu of Cash Interest

RSLGH, LLC, a 10% owner and director of Agrify Corp, received pre-funded warrants in lieu of a cash interest payment, according to a Form 4 filing.

Summary

• RSLGH, LLC, identified as a 10% owner and director of Agrify Corp (AGFY), received pre-funded warrants in lieu of a cash interest payment.
• The warrants were issued as an amendment to a Secured Convertible Note dated November 5, 2025, between Agrify Corporation and RSLGH, LLC.
• The number of pre-funded warrants issued was 18,614, determined by dividing the interest payment owed by $27.42, the closing price of Agrify's common stock at the time of the amendment.
• The pre-funded warrants have an exercise price of $0.001 per share and are exercisable upon issuance.
• The warrants will expire when fully exercised and can be exercised on a cash basis or, if a resale registration statement is not effective, on a cashless basis at Agrify's discretion.
• The pre-funded warrants include a beneficial ownership limitation of 49.99%.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While the warrant issuance helps Agrify manage cash, it also introduces potential dilution for existing shareholders. The terms of the warrants are fairly standard for this type of arrangement.

Positives

• The issuance of pre-funded warrants allows Agrify to conserve cash by issuing equity instead of making a cash interest payment.

Negatives

• The issuance of warrants could dilute existing shareholders' equity.

Risks

• The cashless exercise provision of the warrants could lead to further dilution if a resale registration statement is not effective.
• The beneficial ownership limitation of 49.99% may restrict RSLGH, LLC's ability to fully exercise the warrants.

Future Outlook

The document does not contain specific forward-looking statements beyond the terms of the warrant agreement.

Industry Context

The issuance of warrants in lieu of cash payments is a financing strategy sometimes used by companies, particularly those seeking to manage their cash flow or in industries where access to capital is constrained. This is common in the cannabis industry.

Comparison to Industry Standards

• Issuing warrants in lieu of cash interest is not uncommon for companies in the cannabis industry, especially smaller companies like Agrify, as they often face challenges in accessing traditional financing.
• Compared to larger, more established cannabis companies like Curaleaf or Trulieve, Agrify's financing options may be more limited, leading them to explore alternative financing methods such as warrant issuances.
• The exercise price of $0.001 is very low, which is typical for pre-funded warrants issued in these types of arrangements.

Stakeholder Impact

• Shareholders may experience dilution if the warrants are exercised.
• Agrify benefits from conserving cash by issuing warrants instead of making a cash interest payment.

Next Steps

• RSLGH, LLC may exercise the warrants, potentially increasing its ownership stake in Agrify.
• Agrify may need to register the resale of the underlying shares of common stock to allow for cash exercise of the warrants.

Key Dates

Keywords

pre-funded warrants, Agrify Corp, RSLGH, LLC, interest payment, Secured Convertible Note, AGFY, beneficial ownership, dilution