Loop Media, Inc. (the "Company"), a Nevada-based provider of help supply services, has disclosed a significant financial challenge in a recent SEC 8-K filing. On Monday, the Company reported receiving an acceleration notice from its senior lender concerning a revolving loan facility. The notice demands full payment of the outstanding amount by the previously set deadline of November 8, 2024.
The situation arose after the Company incurred indebtedness that was not subordinated to the senior lender's debt, as per the lender's requirements. Despite ongoing negotiations to resolve the issue and the lender's oral agreement to suspend the payment demand to facilitate further discussions, there has been no formal written confirmation of this suspension.
The Company has maintained regular payments to the senior lender according to the loan terms and intends to continue doing so. However, failing to reach an agreement with the senior lender could perpetuate the default state, potentially leading to the senior lender exercising its rights as the senior secured lender. This could further trigger cross-defaults under other loan agreements, risking acceleration of those debts as well.
The Company, previously known as Interlink Plus, Inc., is headquartered in Burbank, CA, and operates under the trading symbol LPTV, although it is not currently listed on any stock exchange.
The financial strain detailed in the SEC filing underscores the importance of maintaining clear communication and adhering to the terms of financial agreements. The information reported is based on a press release statement.
In other recent news, Loop Media is facing potential default on a senior loan due to incurring debt not subordinated to the senior lender's debt. The company is actively negotiating to resolve the situation. Concurrently, Loop Media has undergone significant executive changes, including the appointment of Ari Olgun as Interim CFO.
The company also secured $700,000 through a future receipts sale to CFG Merchant Solutions and a $525,000 subordinated loan from Agile Capital Funding.
Loop Media's shareholders have approved an increase in authorized shares from 150,000,000 to 225,000,000, providing the company with more flexibility for future corporate endeavors.
Unfortunately, Loop Media reported a 26% drop in fiscal Q2 2024 revenue, totaling $4 million, and a decrease in gross profit margin to 10.4% from 29.4% in the previous year.
Despite these financial challenges, the company extended its loan agreement with GemCap Solutions to July 29, 2025, and added its subsidiary, Retail Media TV, as a co-borrower.
In response to the delisting of Loop Media's common stock from the NYSE American due to low selling price, the company has begun trading on the OTC Pink Market. However, Loop Media has been granted until October 23, 2025, by the NYSE American LLC to meet the continued listing standards. Amidst these recent developments, Loop Media announced plans to introduce several Free Ad-Supported Streaming TV (FAST) channels.
InvestingPro Insights
Loop Media's financial challenges, as outlined in the SEC filing, are further illuminated by recent data from InvestingPro. The company's market capitalization stands at a modest $4.45 million, reflecting its current financial strain. InvestingPro Tips highlight that Loop Media is "quickly burning through cash" and "operates with a significant debt burden," which aligns with the company's struggle to meet its loan obligations.
The company's revenue for the last twelve months as of Q3 2024 was $24.21 million, with a concerning revenue growth of -36.46% over the same period. This decline is consistent with another InvestingPro Tip indicating that "analysts anticipate sales decline in the current year."
Loop Media's financial health is further strained by its negative operating income of -$23 million and an EBITDA of -$18.38 million for the last twelve months as of Q3 2024. These figures support the InvestingPro Tip that the company is "not profitable over the last twelve months."
Investors should note that Loop Media's stock "generally trades with high price volatility," as per InvestingPro Tips. This is evident in the significant price movements: a 31.26% return over the last week, but a -74.05% return over the last six months, and a staggering -94.29% year-to-date return.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips on Loop Media, providing a deeper understanding of the company's financial position and market performance.
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