Excite Technology Secures $1.05M Convertible Note After Record $1M Cash Quarter
Excite Technology Services (ASX: EXT) has secured $1.05 million in convertible note funding from existing sophisticated investors, capitalising on the company’s strongest quarterly cash performance to date. The December 2025 quarter marked an inflection point for Excite Technology, with operational cash flows exceeding $1 million, described as the strongest quarterly cash performance in the company’s history.
Excite Technology secures $1.05 million convertible note funding to capitalise on cash flow momentum
The cybersecurity services provider has received firm commitments totalling $1.05 million through unsecured convertible notes from existing sophisticated investors. This funding arrives at a pivotal moment, following the December 2025 quarter (Q2 FY26) when the business delivered operational cash flows of more than $1 million, described by the company as “the strongest quarterly cash performance in the Company’s history.”
The participation of existing investors signals confidence in management’s execution. Rather than distress funding, the capital raise positions Excite to scale operations from a demonstrated operational turnaround, with the company now generating meaningful positive cash flows from its cybersecurity and managed IT services operations.
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Key terms of the convertible notes
The convertible notes carry commercial terms designed to provide flexibility for both the company and investors. Completion of the note issue is expected within the coming days, with conversion to equity and the issue of free-attaching options subject to shareholder approval.
| Term | Detail |
|---|---|
| Principal | $1.05 million |
| Interest Rate | 15% per annum, assessed quarterly |
| Interest Payment | Shares (with attaching options) or cash at investor election |
| Term | 12 months |
| Conversion Price | $0.01 per share (subject to shareholder approval) |
| Free-Attaching Options | 1 option per 2 shares on conversion; exercise price $0.012; 36-month expiry (subject to shareholder approval) |
The conversion price of $0.01 and option exercise price of $0.012 provide clear benchmarks for investors monitoring the company’s share price progression. The shareholder approval requirement ensures existing holders retain oversight of potential dilution from conversion and option exercise.
What are convertible notes and why do companies use them?
Convertible notes function as short-term debt instruments that can convert into equity at a predetermined price, offering flexibility for both issuer and investor. They provide companies with immediate access to capital without triggering dilution until conversion occurs, while rewarding investors who convert if the share price appreciates above the conversion price.
For growth-stage technology companies, this financing structure proves particularly attractive. The company secures working capital to fund expansion initiatives without immediate shareholder dilution, whilst investors gain exposure to equity upside if operational performance continues improving.
For Excite, the convertible note structure allows the company to deploy growth capital immediately while deferring potential dilution until shareholder approval is obtained and investors elect to convert. This timing flexibility aligns funding with the company’s demonstrated operational momentum.
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Strategic rationale and outlook
The Board has stated the funding will enable the company to build on its December quarter momentum and continue driving toward consistent cash flow positivity across the group. Management’s focus centres on scaling recurring revenue streams, a structural driver of valuation multiples in the technology services sector.
Excite Board
“The Board believes this funding will enable Excite to build on this momentum, scale recurring revenue streams and continue driving toward consistent cash flow positivity across the Excite group.”
Recurring revenue growth from managed cybersecurity and IT services contracts provides more predictable cash flows and higher valuation multiples than project-based revenue. The company’s stated objective of achieving consistent cash flow positivity establishes a measurable benchmark for investors to track execution against strategic targets.
With operational cash flows now exceeding $1 million quarterly, Excite aims to replicate and build upon this Q2 FY26 performance across subsequent quarters.
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