SunPower Inc. Announces Convertible Debenture Financing with YA II PN, Ltd.

Key Points for Investors

• SunPower Inc. (Nasdaq: SPWR) has entered into a convertible debenture financing arrangement with YA II PN, Ltd., a fund managed by Yorkville Advisors Global, LP.
• The transaction includes a Purchase Agreement, a Convertible Debenture, and a Registration Rights Agreement.
• This financing provides SunPower with access to new capital, which could have a significant impact on the company’s liquidity, growth plans, and stock price.

Detailed Overview of the Transaction

Nature of the Transaction

On March 6, 2026, SunPower Inc. executed a series of agreements with YA II PN, Ltd., including:

• Purchase Agreement: Outlines the terms under which YA II PN, Ltd. will purchase the Convertible Debenture.
• Convertible Debenture: A security that can be converted into shares of SunPower’s common stock under specified conditions.
• Registration Rights Agreement: SunPower agrees to file a registration statement registering the resale of the shares underlying the debenture and any common stock subject to advances under the SEPA (Standby Equity Purchase Agreement).

The full text of these agreements is attached to the Form 8-K as Exhibits 10.1, 10.2, and 10.3.

Potential Impact and Shareholder Implications

• Dilution Risk:
  The issuance of shares upon conversion of the debenture could cause significant dilution to existing shareholders. The company acknowledges that this financing could “significantly increase the outstanding number of Common Shares” and result in dilution for current investors.
• Exemption from Registration:
  The offer and sale of the debenture are being made under Section 4(a)(2) of the Securities Act, which means the securities are not registered and are subject to transfer restrictions.
• Listing Commitment:
  SunPower is required to keep its shares listed on the Nasdaq Capital Market, and the company must reserve enough shares to cover potential conversions at the “floor price” specified in the debenture.
• Material Financing Terms:
  The transaction includes covenants typical for such deals, including:
  • SunPower must file a registration statement and maintain listing on a national exchange.
  • The company is restricted from entering into other variable-rate transactions or related-party payments while the debenture is outstanding above a certain threshold.
  • The company must not provide material, non-public information to the investor without public disclosure, ensuring fair disclosure practices.
• Convertible Debenture Terms:
  While the exact principal amount is not specified in the summary, the debenture is convertible, and the company has made representations that it will honor all conversion requests in accordance with the terms, regardless of dilution effects.
• Indemnification and Legal Protections:
  Both parties have agreed to broad indemnification clauses, providing protection against breaches, misrepresentations, and certain legal liabilities.
• Price-Sensitive Triggers:
  The debenture includes standard default provisions, including:
  • Delisting from the Nasdaq or failure to file periodic reports on time could trigger an event of default.
  • Any “change of control” or adverse litigation could also be considered default events, potentially accelerating the debenture and causing further dilution or financial strain.
• Restrictions on Short Sales:
  The investor agrees not to engage in net short sales of SunPower shares while the debenture is outstanding, helping to reduce downward pressure on the stock from this financing arrangement.

Exhibits and Legal Documents

• Exhibit 10.1: Purchase Agreement
• Exhibit 10.2: Convertible Debenture
• Exhibit 10.3: Registration Rights Agreement

Portions of these exhibits are redacted or omitted as permitted under SEC regulations. Investors may request copies of omitted schedules or exhibits from the SEC.

Important Takeaways for Shareholders

• This financing is potentially price sensitive and could affect SunPower’s share price due to the risk of dilution and the company’s ability to access new capital.
• Shareholders should monitor future SEC filings, as conversion of the debenture, registration of new shares, or any default events could materially impact the stock price.
• SunPower management is required to keep investors informed of all material, non-public information related to this transaction.
• The company may seek shareholder approval if required to increase its authorized share capital or for any action that could affect the Exchange Cap.

Conclusion

The execution of this convertible debenture financing provides SunPower with capital flexibility but introduces the potential for significant dilution to existing shareholders. The terms and covenants of the agreements, including registration requirements, listing obligations, and restrictions on further financings or variable-rate transactions, are designed to protect both the company and its investors. However, the issuance of a large number of new shares could impact SunPower’s stock price and is a key risk for current shareholders to consider.

Disclaimer: This summary is for informational purposes only and does not constitute investment advice. Investors should review the full text of SunPower’s SEC filings and consult with their own financial and legal advisors before making any investment decisions. The information above is based on a careful review and inference from the company’s official filings as of March 2026 and may be subject to further updates or amendments.

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