LONDON - ChallengerX plc (AQUIS: CXS) has announced the issuance of a Convertible Loan Note (CLN) to raise £120,000. The funds from this financial instrument are earmarked for due diligence on potential acquisitions and efforts to reinstate the trading of the company's ordinary shares on the Aquis Stock Exchange.
The CLN will carry an annual interest rate of 5%, with the first interest payment scheduled for June 30, 2025, and subsequent payments every six months. Under the terms of the loan, the amount raised will automatically convert into 120 million ordinary shares of the company at 0.1 pence each if the company's shares are relisted on the Aquis Stock Exchange, a process referred to as Automatic Conversion. If the shares are not relisted, the company is obligated to repay the loan within 30 days of receiving a notice from the lender.
The lender also holds the right to convert the loan into shares any time after January 31, 2025, through a Voluntary Conversion Notice. Moreover, if ChallengerX's ordinary shares remain suspended from trading past March 20, 2025, the lender is entitled to purchase additional new ordinary shares at 0.1 pence each, up to a threshold that would give them a 29.95% stake in the company.
The announcement also highlighted that ChallengerX is actively seeking additional capital to ensure adequate working capital. The directors of ChallengerX are taking responsibility for this announcement, which is based on a press release statement.
It is important to note that the relisting of ChallengerX shares on the Aquis Stock Exchange is not guaranteed, and the company's efforts are ongoing. The funds raised are thus critical for ChallengerX's operational and strategic plans, including the due diligence process for potential acquisitions that was previously announced on October 29, 2024.
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