LONDON (ShareCast) - (Sharecast News) - Belluscura announced on Monday that it has signed a short-term secured convertible loan note to raise up to $1.5m as part of its ongoing strategic review aimed at strengthening its capital position.
The AIM-traded firm said the loan was arranged by Omaha Value, a US-based merchant banking and investment group, which subscribed for an initial $0.25m, with further tranches of $0.25m available at the company's discretion.

It said the loan note carried an annualised interest rate of 18%, payable monthly in arrears, and was secured against certain assets of Belluscura's wholly owned US subsidiary.

The loan would be repayable within 12 months, or could be converted into new ordinary shares at 1.125p per share.

Omaha also received warrants to subscribe for up to 10,973,750 shares at the same price, with further warrants linked to any additional drawdowns.

Alongside the loan, Belluscura said it had signed heads of terms with Omaha for a proposed $12m equity fundraising via a direct subscription at 1.125p per share.

Participants in the subscription would also receive warrants on a one-for-one basis.

An open offer to existing shareholders on the same terms was also planned, with accompanying warrants equivalent to one share for every two shares subscribed.

The company said the proposed fundraising would be subject to shareholder approval and discussions with the Takeover Panel to waive any mandatory offer requirements, as Omaha and its investor group could own over 30% of the company's enlarged share capital if the loan was converted and warrants exercised.

Belluscura said there was no certainty the fundraising would proceed.

Should it not, the company said it faced material uncertainty regarding its ability to meet short-term cash requirements.

In a trading update, Belluscura reported continued strong demand for its X-PLOR portable oxygen concentrator, with unaudited May sales of $0.54m, up from $0.52m in April.

The full commercial launch of its new DISCOV-R device remained on track for the third quarter despite financial pressures.

Belluscura also confirmed that publication of its audited results for the year ended 31 December would be delayed beyond the AIM deadline of 30 June due to the ongoing funding process.

As a result, trading in the company's shares would be suspended from 0730 BST on 1 July, with trading expected to resume following completion of the fundraising and release of the annual report.

At 1036 BST, shares in Belluscura were up 0.52% at 0.73p.

Reporting by Josh White for Sharecast.com.

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