Identitii Ltd Launches $20M Convertible Note Facility to Support BNDRY Growth
Identitii secures $20 million convertible note facility to fund BNDRY growth
Identitii (ASX:ID8) has signed a $20 million Convertible Security Funding Agreement with The Blackstone Mercantile Group Ltd. SAC on 7 July 2026, establishing a staged funding structure to support the growth of its BNDRY platform.
The agreement features a binding commitment for $5 million (before costs), subject to shareholder approval, plus access to up to $15 million in further funding under various conditions and approvals.
According to the Company, the Investor is a capital markets group with experience providing growth capital to listed companies on the NYSE, NASDAQ, Euronext, the London Stock Exchange and the Toronto Stock Exchange. The facility is intended to move Identitii toward its stated goal of achieving cashflow breakeven by the end of next year.
The Company has stressed that the Investor does not intend to take control. To guarantee this, the parties contractually agreed to cap the Investor’s ownership at 19.99% of the voting power in Identitii, meaning the Company cannot convert shares if doing so would breach the cap.
At a glance:
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Facility size: up to $20 million (before costs)
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Binding first tranche: $5 million (subject to shareholder approval)
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Further funding: up to $15 million (conditions and approvals apply)
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Investor ownership contractually capped at 19.99% voting power
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Proceeds directed to BNDRY plus investor marketing to a global audience and general working capital
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How the funding structure works
The facility follows a staged sequence, beginning with an initial advance ahead of a shareholder vote and progressing through further tranches tied to approvals. The table below sets out each step, with the exact figures and timing.
| Step | Action | Amount | Timing | Investor significance |
|---|---|---|---|---|
| Step 1 | Initial advance (repayable in cash if not approved) | $0.5M | Within 10 days of Notice of Meeting | Converts into convertible notes subject to approvals and the 19.99% cap |
| Step 2 | General Meeting — three resolutions | N/A | Following Notice of Meeting | All three resolutions must pass for the transaction to proceed |
| Step 3 | Second advance; 5 million convertible notes issued; $1.5M paid to Fairfax Partners Inc. | $4.5M | Within 10 days of shareholder approval | Company retains $3.5M net from the initial commitment |
| Step 4 | Repayment via conversion at fixed conversion price; six-month exclusive funding period | Conversion at $0.375 | From General Meeting date | Conversion price expected to be a discount to the post-consolidation share price |
| Step 5 | Potential further tranches (not guaranteed) | $10M at $0.375, then $5M at $0.50 | After the exclusive period | Subject to agreement and possible further shareholder approvals |
If the proposed transaction is not approved by shareholders, the initial $0.5 million advance must be repaid in cash to the Investor. The $3.5 million net retained by the Company comprises the $0.5 million from Step One plus the remaining $3.0 million from Step Three.
The three shareholder resolutions
At the General Meeting, shareholders will be asked to vote on three resolutions, all of which must be approved before the transaction can proceed:
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The 200-for-1 consolidation of the Company’s securities.
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The issue of convertible notes to the Investor under ASX Listing Rule 7.1.
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The issue of 92 free Bonus Options for every 100 Shares held at the Bonus Options Offer Record Date, each exercisable at 0.1 cents, entitling the holder to one Share plus one free Piggyback Option (also exercisable at 0.1 cents, entitling the holder to one Share).
The Company has clarified that the consolidation will convert every 200 shares into 1 share, with the share price adjusting accordingly. Individual ownership share of the Company and its market capitalisation do not change as a result.
Managing dilution through Bonus Options
The Investor conversion at $0.375 per share is expected to represent a discount to the post-consolidation share price, and the Company has described this as one of the costs of the proposed transaction. This dilution is intended to be partially offset by the Offers under Resolution 3.
The Board views the proposed issue of Bonus Options plus Piggyback Options as a key reason for recommending the transaction. These Bonus Options are issued for nil consideration to existing shareholders, excluding the Investor.
The Company has stated that any intrinsic value is intended to assist in reducing the dilution existing shareholders may experience, not to provide a profit or a benefit from any future increase in the share price. There is no assurance as to the value, if any, that the Options will have, and a shareholder who does not exercise their Options may not obtain the benefit of any intrinsic value.
The Investor is not entitled to convert any convertible notes into shares until one Business Day after the Bonus Options Offer Record Date, which means the Investor cannot participate in the Bonus Options Offer or the subsequent Piggyback Offers.
CEO Commentary — John Rayment
“We are obviously very excited to share today’s news with our shareholders, particularly because we are hopeful this is the last time the Company will need to raise ordinary working capital. We can now focus solely on growing BNDRY and recommit to our goal of achieving cashflow breakeven by the end of next year.”
Rayment added that the Company has a pipeline of commercial opportunities that have been waiting for it to demonstrate balance sheet strength, noting the funding support should help unlock those opportunities.
What a convertible note facility means for investors
A convertible note is a form of debt that can convert into shares at a set price rather than being repaid in cash. Under this facility, the conversion prices are fixed at $0.375 and $0.50, which differs from floating-rate structures where the conversion price moves with the market.
The fixed conversion price provides certainty. The ownership cap prevents the Investor from gaining control of the Company. The issue of Bonus Options and Piggyback Options limits dilutive impact.
The Board indicated it considered a traditional placement, but current global market conditions and the Company’s limited daily trading volumes would require a significant share price discount, likely with attaching options, creating further dilution and potential stock overhang. Floating-rate convertible note facilities were also assessed but were judged to introduce meaningful dilution risk without an offset mechanism.
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Global reach and the road ahead
Fairfax Partners Inc. will act as the Company’s fully embedded communications department, combining infrastructure, ongoing management and investor and product marketing, with a direct line to the Company’s strategy. Fairfax has established reach across the NASDAQ, LSE, Euronext, TSX, CSE and ASX.
The $1.5 million allocation is directed toward global investor and product marketing, connecting the Company with institutional and retail investors across six major exchanges while positioning BNDRY in international markets.
Next steps and timeline:
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The Company will soon call a General Meeting, with a Notice of Meeting to be released.
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First $0.5 million advance within 10 days of the Notice of Meeting.
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Second $4.5 million within 10 days of shareholder approval.
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Six-month exclusive funding period begins from the General Meeting date.
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Further tranches of up to $10 million and $5 million available after the exclusive period, subject to agreement and possible further approvals.
The Company has framed the arrangement as the best available funding opportunity at this point in time, with the fixed conversion price providing certainty and the Bonus Options structure intended to limit dilutive impact. Identitii has positioned the funding certainty as a means to unlock its commercial pipeline and support its stated outlook of reaching cashflow breakeven by the end of next year, though this remains a target rather than a guarantee.
The BNDRY platform strategic focus has been building since early 2026, when Identitii sunset its legacy Overlay+ product and redirected engineering resources toward BNDRY, delivering a net $235k annual cash flow improvement in the process.
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