Founder Group Amends $16M Note and $1.08M Pre-Paid Purchase to 85% VWAP Pricing

summarizeSummary

Founder Group amended its $16.07M convertible note and $1.08M pre-paid purchase to price conversions at 85% of the lowest recent VWAP, materially increasing dilution risk for existing shareholders.

check_boxKey Events · Financing and Capital Events · FGL

• Conversion Price Cut to 85% VWAP

  The $16.07M secured convertible note (Dec 11, 2025) and $1.08M pre-paid purchase (July 6, 2026) now convert at the lower of 85% of the 10-day lowest VWAP or 85% of the lowest intraday hourly VWAP.

• Dilution Risk Deepens

  At the current $0.31 share price, the 85% formula implies conversion prices potentially below $0.26, meaning the $17.15M combined principal could convert into a substantially larger share count than under prior terms.

• Investor Incentive to Convert

  The 15% discount to the lowest recent VWAP gives Streeterville and Avondale a strong incentive to convert and sell shares, creating persistent selling pressure on the stock.

• Follows July Pre-Paid Financing

  This amendment comes seven weeks after the July 6 pre-paid purchase agreement, indicating the company continues to rely on highly dilutive financing structures.

auto_awesomeAnalysis · FGL · Real Estate & Construction

Existing shareholders face a material worsening of terms after Founder Group amended the conversion price on its $16.07 million secured convertible note and the purchase price on its $1.08 million pre-paid purchase agreement. Both instruments now price at 85% of the lowest VWAP over the prior 10 trading days or the lowest intraday hourly VWAP. Investors can convert or purchase shares at a 15% discount to the most favorable recent price, which deepens dilution and creates a strong incentive for holders to convert and sell into any strength. The amendment follows the July 6 pre-paid purchase financing and comes as the stock trades near $0.31, meaning the effective conversion price could be well below current levels.