ITI Eyes adjusts CB conversion price after 3 months... Up to 30% of total shares may be released

Stock Price Drops to Lowest Adjustment Limit of Conversion Price
Operating Loss Recorded in First Half of the Year... Potential Decrease in Sell-Off Volume if Stock Price Rises

ITEyes' first tranche convertible bonds (CB) issued last July have seen their conversion price lowered to the minimum adjustment limit in just over three months. If the stock price does not rebound, nearly 30% of the currently listed shares could be released into the market.

According to the financial investment industry, ITEyes announced on the 30th through a public disclosure that the conversion price has been reduced from the previous 9,478 KRW to 6,641 KRW. This adjustment is due to the decline in the market price. The new conversion price corresponds to 70% of the original price, reaching the minimum adjustment limit.

ITEyes issued the first tranche of CB worth 12 billion KRW last July. The nominal interest rate is 1%, and the maturity interest rate is 2%. The CB was subscribed by NH Investment & Securities (5.5 billion KRW), KB Securities (1 billion KRW), Korea Securities Finance Corporation (2.5 billion KRW), and JB Woori Capital (2 billion KRW). Additionally, the Kiwoom-Suseong No.1 New Technology Business Investment Association, formed by Korea Investment & Securities, Kiwoom Securities, and Suseong Asset Management, invested 1 billion KRW. ITEyes stated that the funds raised would be used for operations and expanding new business areas.

The reason for ITEyes' minimum adjustment price is the decline in its stock price. The company's stock closed at 9,170 KRW on July 18. It then closed at 6,140 KRW on the 27th. During this period, the stock price dropped by 33.04%.

With the sharp decline in stock price lowering the conversion price to the minimum, the volume that could be released into the market has also significantly increased. Previously, 1,264,889 shares, equivalent to 20.99% of the total 6,026,990 shares, could have been released. However, with this conversion price adjustment, the volume that could be released into the market has increased to 29.98%. Including the convertible shares in the total shares, the proportion rises from 17.35% to 23.07%. This raises concerns about overhang (potential large-scale selling pressure).

However, the convertible volume could decrease depending on the stock price direction. The conversion request period is from July 28, 2025, to June 28, 2028. Since there is still sufficient time, if the stock price rises, the conversion price could be adjusted upward, reducing the volume convertible into shares.

ITEyes was established in 2012. It provides systems for financial companies including asset management, asset administration, credit evaluation, and over-the-counter derivatives management. The company was listed on KOSDAQ in 2021. In the first half of this year, it recorded consolidated sales of 36.5 billion KRW and an operating loss of 3.8 billion KRW. While sales increased by 37.13% compared to the same period last year, operating losses continued.