29th November 2022
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Cannabis Stock Market

Agrify Refuts Lawsuit & Receives Notice of Delisting

Agrify Corp Q1 2022

The past few months have been a rather complicated period for the cannabis specialist dealing with the market crash, a lawsuit, and a notice of delisting issued by the Listing Qualification Department of The Nasdaq Stock Market, LLC. 

On September 15, 2022, Agrify provided a notice of default to Bud & Mary’s Cultivation as the client was in default of its obligations under a term loan agreement between both companies. The contract goes back to 2021, when Agrify announced in a press release, the 50,000-square-foot facility project. The initial phases were to see the installation of several of Agrify’s Vertical Farming Units due to be completed by Q1 2022 and where Agrify provided senior financing of ‘up to USD 13.5M for the construction to be repaid within 24 months).

On October 5, 2022 Bud & Mary’s Cultivation, Inc filed a complaint in the Superior Court of Massachusetts seeking monetary damages in connection with alleged ‘unfair or deceptive trade practices, breach of contract, and conversion arising from the Agreement’. Agrify commented in a recent press release, about its intention to defend itself against the allegations in what it claims to be “a meritless lawsuit in an obvious attempt to avoid repayment of the credit facility”.

This lawsuit follows another investigation from Bragar Eagel & Squire, P.C., which is investigating potential claims against Agrify Corporation (NASDAQ: AGFY) on behalf of its stockholders. Investigation concerns whether Agrify has violated federal securities laws and/or engaged in other unlawful business practices.

On December 16, 2021, during trading hours, market analyst Bonitas Research published a report regarding Agrify which alleges several issues at the Company including that “[w]e believe that Agrify created artificial demand for its product by financing undisclosed Company insiders to act as independent customers.”

This week, the company also received a deficiency letter from the Listing Qualifications Department of The Nasdaq Stock Market, LLC notifying the company that its shares have been trading under USD 1.00 for 30 consecutive days and that, under the Minimum Bid Requirement, it had 180 calendar days to regain compliance (i.e. reaching USD 1.00 per share for 10 consecutive trading days during the 180-day compliance period).

The company intends to comply with the requirements by effecting a reverse stock split (To be voted on October 14, 2022) to authorize a reverse stock split at a ratio between 1|2 and 1|20. Moreover, yesterday the company has announced a USD 7.5M potential sale through three new projects.

More to follow…

7 Comments

  • […] Indoor Farming Stocks have been severely affected by the current market trend with certain companies flirting with the USD 1.00 per share zone which could lead to them becoming de-listed. […]

  • […] Agrify Corporation (Nasdaq:AGFY) announced that the Company’s Board of Directors approved a 1-for-10 reverse stock split, to be effective as of 12:01 a.m. on Tuesday, October 18, 2022. The Company’s common stock will open for trading on the Nasdaq Capital Market on Tuesday, October 18, 2022 on a split-adjusted basis under the current trading symbol “AGFY.” The reverse stock split was approved by the Company’s stockholders on October 14, 2022 and is intended to increase the per share trading price of the Company’s common stock to enable the Company to satisfy the minimum bid price requirement for continued listing on the Nasdaq Capital Mar… […]

  • […] is the second indoor farming company to have received a de-listing notice after Agrify Corp. Other companies are at risk of receiving a notice such as Kalera which has been traded under a USD […]

  • […] basis. These past weeks, two other indoor farming companies have received de-listing notice, Agrify (NASDAQ:AGFY) and Edible Garden (NASDAQ:EDBL) as they have been trading under a USD 1.00 a share for more than 30 […]

  • […] it has received written notice from The Nasdaq Stock Market LLC informing the Company that it has regained compliance with Nasdaq’s minimum bid price listing requirement. The Company has satisfied the terms for continued listing on the Nasdaq Capital Market by […]

  • […] is now under threat of being de-listed from NASDAQ similarly to Edible Garden Ag (NASDAQ:EDBL) or Agrify (NASDAQ:AGFY) (Both companies have received de-listing notice but Agrify managed to regain […]

  • […] excludes $5.3 million of design and builds revenue, which was deferred as a result of a default by Bud & Mary’s ownership on the terms of its Total Turn-Key Solution and Loan Agreements, as well as the current […]

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