Audio Pixels Secures A$1.25M Funding at 12% Interest with Convertible Notes
Audio Pixels Holdings has raised A$1.25 million through unsecured convertible notes from sophisticated investors, with the Chairman’s company poised to invest up to A$2 million pending shareholder approval. This funding boost aims to extend the company’s working capital runway and support its strategic goals.
- A$1.25 million raised via unsecured convertible notes at 12% interest
- Convertible notes convertible at A$9.04 per share with downside protection
- 375,000 unlisted options issued alongside notes with A$7.59 strike price
- Chairman-controlled 4F Investments plans up to A$2 million subscription subject to approval
- Funding extends working capital runway and supports strategic objectives
Strategic Funding Boost
Audio Pixels Holdings Limited (ASX, AKP), a pioneer in digital loudspeaker technology, has successfully raised A$1.25 million through the issuance of unsecured convertible notes to two sophisticated investors. This capital injection is designed to extend the company’s working capital runway, enabling it to pursue near-term objectives amid a competitive technology landscape.
The convertible notes carry a 12% annual interest rate, which is capitalised until repayment or conversion, and are convertible into ordinary shares at a price of A$9.04 per share. Notably, the conversion price includes a floor of A$3.50 per share and a 30% discount mechanism if the company undertakes a lower-priced share placement before the notes mature on 31 January 2027. This structure provides investors with downside protection while aligning their interests with the company’s growth prospects.
Incentives and Shareholder Considerations
Alongside the convertible notes, investors received 375,000 unlisted options exercisable at A$7.59, expiring in May 2027. These options add an additional layer of potential upside, reflecting confidence in Audio Pixels’ innovative MEMS-based digital loudspeaker technology platform.
Further strengthening the funding round, 4F Investments Pty Ltd, controlled by Audio Pixels’ Chairman Fred Bart, has indicated its intention to subscribe for convertible notes valued between A$250,000 and A$2 million on identical terms. This subscription is contingent upon shareholder approval at the upcoming meeting, in compliance with ASX Listing Rule 10.11. The Chairman’s commitment signals strong internal confidence in the company’s strategic direction.
Implications for Capital Structure and Growth
The issuance falls within the company’s 15% placement capacity under ASX Listing Rule 7.1, avoiding immediate shareholder dilution concerns. However, the potential conversion of notes and exercise of options will increase the number of shares on issue, which investors should monitor closely.
Audio Pixels’ patented technology, which generates sound directly from digital audio streams using micro-electromechanical systems, positions it uniquely in the consumer electronics sector. This funding round provides the financial runway to advance product development and commercialisation efforts, critical in a sector where innovation cycles are rapid and capital intensive.
Overall, this capital raise reflects a vote of confidence from sophisticated investors and the company’s leadership, underpinning Audio Pixels’ ambitions to lead the next generation of digital audio technology.
Bottom Line?
With fresh funding secured and the Chairman doubling down, Audio Pixels is poised for its next growth phase; but shareholder approval and market conditions remain key variables.
Questions in the middle?
- Will shareholder approval be granted for 4F Investments’ convertible note subscription?
- How might future equity placements affect the conversion price and share dilution?
- What are the company’s specific short-term milestones to be achieved with this funding?