GM. 7/3 8K......Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.
As previously reported, reAlpha Tech Corp. (the “Company”) entered into a note purchase agreement with Streeterville Capital, LLC (the “Lender”) on August 14, 2024, pursuant to which the Company issued and sold a secured promissory note in favor of the Lender (the “Original Note”) with an original principal balance of $5,455,000 maturing on February 14, 2026. Under the terms of the Original Note, beginning seven months from the issuance and continuing until the Original Note is repaid in full, the Lender may redeem up to $545,000 per month by delivering a written redemption notice to the Company (each, a “Redemption Notice”). Upon receipt of such Redemption Notice, the Company is required to pay the specified redemption amount (each, a “Redemption Payment”) in cash within three trading days. After the Company has made five Redemption Payments in cash, any subsequent Redemption Payments made in cash will be subject to a 9% redemption premium.
On July 2, 2025, the Company received a Redemption Notice from the Lender for a Redemption Payment in the amount of $350,000 (the “Redemption Amount”). The Company and the Lender agreed that the Company may fully satisfy the Redemption Amount in shares of Common Stock, in lieu of cash. While the Company and the Lender have not yet entered into an agreement, the Company currently anticipates issuing approximately 1,267,656 shares (the “Exchange Shares”) of Common Stock, at an effective price per Exchange Share equal to $0.2761, which would be below the “Minimum Price” as defined in Nasdaq Listing Rule 5635(d) (the “Exchange”). The number of Exchange Shares to be issued in connection with the Exchange is expected to be less than 20% of the Company’s voting power outstanding prior to the Exchange. The Company intends to enter into a definitive agreement regarding the Exchange during the week of July 7, 2025.
This disclosure is being made to ensure complete market information. The proposed Exchange remains subject to the execution of a definitive agreement. No assurance can be given that such agreement will be reached or that the Redemption Amount will ultimately be satisfied through the Exchange in lieu of cash.
The foregoing description of the Original Note does not purport to be a complete description of the rights and obligations of the parties thereunder and is qualified in its entirety by reference to the full text of the Original Note. A copy of the Original Note was previously filed as Exhibit 4.4 to the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 14, 2024, and is incorporated herein by reference.
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