Interactive Strength, Inc. (NASDAQ:TRNR), a manufacturer of electronic and electrical equipment, has entered into an amended agreement with investors, modifying the terms of a previously issued convertible promissory note, according to a recent SEC filing.
The Austin, Texas-based company, under the new terms agreed on Monday, has altered the original note with a principal amount of $6 million to a new principal of $4 million. The amended and restated note also adjusts the conversion price to $4.79 per share, which was the closing price of the company's common stock on the Nasdaq on the date of the agreement.
Since the amendment, $200,000 of the note's principal amount has been converted into 41,754 shares of common stock, leaving the outstanding principal at $3.8 million as of Wednesday. Additionally, from Monday through Wednesday, holders of the company’s Series A Convertible Preferred Stock have converted 409,275 shares into 116,604 shares of common stock. These conversions were executed under an exemption from registration requirements, and the newly issued shares were accounted for in the company’s quarterly report filed on Thursday.
The issuance of shares in exchange for the reduction in the principal amount and the conversion of Series A shares was conducted without any commission or remuneration for soliciting the exchange. The transaction is grounded on the condition that it was an exchange with existing holders of the company's securities.
In other recent news, Interactive Strength Inc. has been actively restructuring its debt and expanding into new markets. The company has undergone a substantial debt-to-equity conversion with Vertical Investors LLC, reducing its outstanding loan by $243,750 in exchange for 1,500,000 shares of common stock. In addition to this financial restructuring, Interactive Strength has also announced a reverse stock split of its common stock at a 1-for-100 ratio to regain compliance with Nasdaq's minimum bid price requirement.
Interactive Strength is also making significant strides in market expansion. The company showcased its FORME Lift product at the Titleist Performance Institute (TPI) Summit, targeting the golf performance market. Furthermore, the company has partnered with Chuze Fitness, deploying multiple CLMBR vertical climbing machines in select locations.
The company has also secured exclusive distribution agreements for its CLMBR vertical climbing machines in several international markets, including Germany, Switzerland, Austria, the Gulf Cooperation Council countries, and Indonesia. These recent developments reflect Interactive Strength's ongoing efforts to optimize its balance sheet and financial flexibility.
InvestingPro Insights
Recent InvestingPro data sheds light on Interactive Strength, Inc.'s (NASDAQ:TRNR) financial position and market performance, providing context to the company's recent financial maneuvering. The company's market capitalization stands at a modest $0.21 million, reflecting its small-cap status. Despite a significant revenue growth of 69.7% over the last twelve months, TRNR is grappling with profitability challenges, as evidenced by its negative gross profit of -$4.82 million and an operating income of -$37.68 million for the same period.
InvestingPro Tips highlight that TRNR's stock has taken a substantial hit recently, with a 42.22% decline in the past week and a staggering 71.63% drop over the last month. This aligns with the company's efforts to restructure its debt and equity, as detailed in the recent SEC filing. The stock's RSI suggests it may be in oversold territory, which could be of interest to value-oriented investors considering the recent financial restructuring.
For those seeking a deeper understanding of TRNR's financial health and market position, InvestingPro offers 16 additional tips, providing a comprehensive analysis to inform investment decisions.
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