Peloton shares plunged on Monday after the connected fitness company said it is launching a “global refinancing,” as it looks to stave off a cash crunch amid falling sales. 

The company is offering $275 million in convertible senior notes due 2029 in a private offering and plans to enter into a $1 billion five-year term loan and $100 million revolving credit facility. 

Peloton plans to use the proceeds to buy back about $800 million of its 0% convertible senior notes, which are currently due in 2026, and refinance its existing term loan. 

Shares fell more than 12% in extended trading after Peloton announced the refinancing, but later regained some ground. 

Last month, Peloton announced that its CEO Barry McCarthy was stepping down and said it planned to lay off 15% of its workforce because it “simply had no other way to bring its spending in line with its revenue.”

The restructuring was designed to improve Peloton’s cash position as demand for its connected fitness products continues to fall. The company has been working to achieve positive free cash flow, which “makes Peloton a more attractive borrower” and “is important as the company turns its attention to the necessary task of successfully refinancing its debt,” McCarthy said in a memo to staff prior to his departure.

In a letter to shareholders, the company said it is “mindful” of the timing of its debt maturities, which include convertible notes and a term loan. It said it is working closely with its lenders at JPMorgan and Goldman Sachs on a “refinancing strategy.”

“Overall, our refinancing goals are to deleverage and extend maturities at a reasonable blended cost of capital,” the company said. “We are encouraged by the support and inbound interest from our existing lenders and investors and we look forward to sharing more about this topic.”