- Wednesday, October 16, 2024
Strategic Move to Improve Liquidity Position
Beachbody, a prominent health and wellness company, has made a strategic decision to sell its production facility in Van Nuys, Calif. for $6.2 million as part of its turnaround plan to enhance liquidity.
Utilizing Proceeds for Debt Repayment
The net proceeds of $6.2 million from the sale were used by Beachbody to make a partial prepayment on its term loan, amounting to $5.5 million. This move aligns with the company's goal of optimizing its balance sheet for future growth.
Flexible Leasing Agreement
Following the sale, Beachbody has entered into a five-year lease agreement for the facility, with options to extend the lease for three years each. This arrangement provides the company with flexibility while ensuring continued operational efficiency.
Covenant Amendment for Financial Flexibility
In addition to the facility sale, Beachbody has successfully amended its term loan agreement with its lender. The amendment includes a reduction in the minimum liquidity financial covenant, from $19 million to $17 million through March 31 and from $24 million to $22 million from April 1 onwards.
Financial Impact and Reporting
The financial transactions related to the sale of the facility and the partial prepayment will be reflected in the upcoming March quarter financial reports. These actions demonstrate Beachbody's commitment to strengthening its financial position and driving sustainable growth.
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