MyEco Group (ASX:MCO) Raises $1.6M Through Convertible Notes
Fundraising Details
MyEco Group has received commitments to raise $1.605 million through the issuance of unsecured convertible notes to sophisticated investors. The funds complement recent operational restructuring initiatives aimed at minimising dilution and reducing annual fixed costs by $2.5 million to $3.0 million.
Convertible Note Terms
The convertible notes accrue interest at 10.5% per annum, payable quarterly over a three-year term. They are convertible at a 15% discount to the 14-day VWAP, with a maximum conversion price of $0.05 and a minimum of $0.019 per share. Conversion is permitted twelve months after the drawdown date, with mandatory conversion at maturity. The company may redeem the notes with 30 days’ notice, allowing noteholders to convert during this period.
Executive Comments
CEO and Executive Director Richard Tegoni stated, “We are pleased to receive support for the Convertible Note issue from both existing shareholders and new investors during the current challenging global market conditions. This capital will enable us to continue with growth plans whilst protecting shareholder value by minimising dilution to existing shareholders.
“We are confident that our focus on improving margins through a more refined sales strategy and a more cost-effective manufacturing model will significantly enhance our ability to achieve positive EBITDA in the medium term.”
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended MyEco Group Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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