Careteq repays $125K director loans early after $2.2M capital raise

Early Loan Repayment Signals Financial Strength

Careteq Limited (ASX:CTQ) has repaid in full the $125,000 working capital loans previously extended by its directors and company secretary, settling the amounts including 12% per annum capitalised interest approximately a month ahead of the June 4, 2026 maturity date. The repayments were funded from the proceeds of a recently completed two-tranche capital raising, which raised approximately $2.2 million and included a tranche subject to shareholder approval at the April 23 general meeting.

This early repayment removes related-party indebtedness from the balance sheet, a move the Board describes as reinforcing alignment between directors and shareholders. The loans, originally disclosed in June 2025, were made during a critical period to support Careteq’s working capital position and have now been returned promptly following the capital raise.

Allocation of Capital Raising Proceeds

The capital raising underpinning this repayment was announced in March 2026 and structured in two tranches: an initial $193,000 issued under existing capacity, and a conditional $2.07 million tranche contingent on shareholder approval. The placement shares were priced at a significant discount to the last closing price, reflecting the company’s need to shore up liquidity and fund ongoing operations.

With director loans repaid, the remaining proceeds from the placement are earmarked for project acquisitions and general working capital, consistent with the use-of-funds disclosure made earlier in March. This allocation follows Careteq’s strategic shift to focus on its core home medicines review platform after divesting its Embedded Health Solutions business for around $5 million earlier this year, a transaction that also helped reduce vendor-related debt and recalibrate the balance sheet two-tranche $2.2M placement sale of Embedded Health Solutions.

Convertible Note Remains Unchanged

While the director and company secretary loans have been fully repaid, the convertible note issued to Mr Antanas Guoga remains on foot under its original terms. The announcement does not provide further details on the convertible note’s maturity or conversion conditions, leaving open questions about its potential impact on future capital structure and shareholder dilution.

The Board also highlighted that the interest paid on the repaid loans is considered arm’s length and consistent with commercial terms agreed at the time, acknowledging the financial benefit received by related parties. This transparency is important given the heightened scrutiny around related-party transactions in listed companies.