Qoria Draws $10M Working Capital Facility From Aura Ahead of July Merger
Qoria secures $10 million working capital facility as Aura merger advances
Qoria Limited has secured a $10 million unsecured working capital facility from US-based digital security firm Aura as the companies progress towards their proposed merger. The facility, funded on 15 April 2026, strengthens Qoria’s balance sheet during the transaction period while the parties work towards an updated completion timeline of July 2026.
The working capital arrangement reflects Aura’s commitment to the transaction as both companies navigate the complexity of integration planning. Qoria has advised that disclosure documents are now expected in May 2026, with the scheme shareholder meeting scheduled for July 2026—a modest shift from the original timeline announced in February.
The facility provides financial flexibility as Qoria targets free cash flow positive status from July 2026 onwards, with the combined group aiming for positive free cash flow from merger completion through 31 December 2026. Transaction costs accumulating during this period will be covered by the facility, eliminating immediate pressure on Qoria’s operating cash flow.
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Key terms of the working capital facility
The $10 million facility carries an annual interest rate of 15%, structured on a payment-in-kind (PIK) basis. This means interest capitalises rather than requiring cash payments during the facility term, preserving Qoria’s cash position as the merger progresses.
Repayment is structured as a bullet payment due by 31 July 2029, or five business days after refinancing, repayment or termination of Qoria’s existing Ashgrove facilities, whichever occurs first. The facility is unsecured, reflecting confidence in the underlying transaction structure.
| Term | Detail |
|---|---|
| Facility Size | A$10 million |
| Interest Rate | 15% per annum (capitalised, no cash payments) |
| Repayment | Bullet repayment by 31 July 2029 |
| Security | Unsecured |
Any amounts owed under the facility will automatically set off against Aura’s obligation to pay the Aura Reimbursement Fee under the merger implementation deed, should that fee become payable. This structure aligns both parties’ financial interests as the transaction proceeds.
What is a working capital facility and why does it matter?
A working capital facility is a form of short-term financing that provides companies with funds to cover day-to-day operational expenses and specific costs during transitional periods. Unlike term loans used for capital expenditure or acquisitions, working capital facilities address timing mismatches between when expenses must be paid and when revenue is received.
Companies frequently use these facilities during merger periods to cover transaction costs (legal fees, integration planning, regulatory filings) while maintaining operational flexibility. The facility ensures Qoria can fund these expenses without drawing down operating cash or disrupting business activities.
The distinction between secured and unsecured facilities is significant. Secured facilities require the borrower to pledge assets (property, equipment, receivables) as collateral, giving the lender recourse if repayment fails. Unsecured facilities carry no such pledge, indicating the lender’s confidence in the borrower’s financial position and the likelihood of the underlying transaction completing.
Qoria’s facility uses a PIK structure where interest accumulates and compounds rather than being paid in cash. This preserves Qoria’s cash balance during the merger period, allowing management to focus on integration planning without immediate debt servicing pressure. The 15% rate reflects both the unsecured nature and the specific transaction context.
Conversion rights if the merger does not proceed
If the merger implementation deed is terminated and the transaction does not complete, Aura holds the right to convert outstanding amounts (including principal, capitalised interest, accrued interest, and a minimum return fee) into Qoria ordinary shares. This conversion right extends until five business days before the 31 July 2029 maturity date.
Conversion pricing is determined by the greater of $0.30 or the 20-day volume weighted average price of Qoria shares traded on the ASX immediately preceding the conversion notice date. Based on Qoria’s current issued capital, maximum conversion would result in approximately 54 million shares, representing roughly 3.9% of issued capital.
The conversion mechanics operate as follows:
- Conversion only applies if the merger is terminated and the transaction does not complete
- Pricing based on the greater of $0.30 or 20-day VWAP, protecting Aura against material share price declines
- Maximum dilution to existing shareholders capped at approximately 3.9%
- Minimum conversion amount of $2.5 million applies
This structure provides Aura with downside protection whilst capping dilution for Qoria shareholders. The $0.30 floor price offers a reference point for valuation, whilst the VWAP mechanism ensures conversion reflects prevailing market conditions.
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Board maintains unanimous recommendation
The Qoria Board continues to unanimously recommend that shareholders vote in favour of the scheme, subject to standard conditions. This recommendation remains conditional on the absence of a superior proposal and the Independent Expert concluding (and continuing to conclude) that the scheme is in the best interests of Qoria shareholders.
Board Recommendation
Each Qoria Director intends to vote all shares held or controlled by them in favour of the scheme, in the absence of a superior proposal and subject to the Independent Expert’s conclusion.
The Board’s continued unanimous support signals confidence that the transaction remains on track despite the revised timeline. Directors’ intention to vote their own shareholdings in favour demonstrates alignment between board recommendations and personal investment decisions.
Revised timeline and next steps
The updated merger timeline reflects the complexity of integrating two businesses across different regulatory jurisdictions. Both parties characterise the shift as attributable to thorough integration planning rather than transaction concerns.
Key dates now include:
- May 2026: Disclosure documents released to shareholders
- July 2026: Scheme shareholder meeting and expected completion
- July 2026 onwards: Qoria targeting free cash flow positive status
- Target: Positive free cash flow from merger completion to 31 December 2026
The additional time provides both parties with extended runway for integration planning, potentially benefiting post-merger execution. Shareholders will receive comprehensive transaction details in the May disclosure documents, including the Independent Expert’s assessment of whether the scheme is in their best interests.
The facility and continued board support demonstrate both parties remain committed to completing the merger. Investors should monitor for the disclosure documents in May 2026, which will provide full transaction details and enable informed voting decisions ahead of the July 2026 scheme meeting.
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