ReAlpha Tech receives redemption notice, plans share issuance to settle debt

ReAlpha Tech Corp. (NASDAQ:AIRE), currently trading at $0.32 and valued at $16.65 million in market capitalization, disclosed Wednesday that it received a redemption notice from Streeterville Capital, LLC for a payment of $350,000 under an existing secured promissory note. The company stated it intends to settle the redemption amount by issuing common stock instead of paying cash. According to InvestingPro analysis, the company faces significant liquidity challenges with short-term obligations exceeding liquid assets.

According to the company’s statement, the anticipated transaction would involve issuing approximately 1,267,656 shares of common stock at an effective price of $0.2761 per share, which is below the “Minimum Price” defined in Nasdaq Listing Rule 5635(d). The number of shares to be issued is expected to be less than 20% of ReAlpha’s outstanding voting power prior to the exchange.

ReAlpha and Streeterville Capital have not yet entered into a definitive agreement for this share issuance. The company expects to finalize the agreement during the week of July 7, 2025. There is no assurance that the agreement will be completed or that the redemption payment will ultimately be made through the issuance of shares.

The original promissory note, dated August 14, 2024, has a principal balance of $5,455,000 and matures on February 14, 2026. Under the note’s terms, the lender has the right to redeem up to $545,000 per month, with redemption payments due in cash within three trading days of notice. After five cash redemptions, further cash payments are subject to a 9% premium.

This disclosure is based on a statement from ReAlpha Tech Corp. filed with the Securities and Exchange Commission.

In other recent news, reAlpha Tech Corp. disclosed that it received a notice from the Nasdaq Stock Market for non-compliance with the market value rule, requiring a minimum market value of $35 million over 30 consecutive business days. The company has until December 29, 2025, to regain compliance, with potential for an extension by Nasdaq staff. Additionally, reAlpha announced leadership changes, with Mike Logozzo stepping up as CEO, succeeding founder Giri Devanur, who will now serve as Executive Chairman. This leadership transition is part of reAlpha’s strategy to accelerate growth and innovation in the U.S. real estate services market. In financial updates, Maxim Group reduced its price target for reAlpha to $1.25 from $3.00, while maintaining a Buy rating, following the company’s first-quarter 2025 financial performance. The company reported revenues of $0.9 million and an adjusted EBITDA loss of $2.0 million, with revenue exceeding expectations but EBITDA falling short. Furthermore, reAlpha fulfilled a partial debt redemption by paying $450,000 and committing to an additional $95,000, reducing its outstanding balance to approximately $4.67 million. Lastly, reAlpha appointed Cristol Rippe as Chief Marketing Officer, who will lead the company’s marketing strategies, aligning with its mission to simplify homebuying through AI technology.

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