25 January 2022

AIQ Limited

("AIQ" or the "Company")

Issue of Convertible Loan Notes to raise £500,000

The Board of AIQ Limited (LSE: AIQ) announces that it has raised £500,000 through the issue of unsecured convertible loan notes (the "Loan Notes") to three existing shareholders including an Executive Director of the Company as set out further below (together the "Noteholders").

The Loan Notes have been issued to the Noteholders as follows:

·    £250,000 to Li Chun Chung, an Executive Director of the Company and who, as at the date of this announcement, has an interest in 1,425,500 ordinary shares in the Company ("Ordinary Shares"), representing 2.2% of the Company's issued share capital

·    £125,000 to Soon Beng Gee who, as at the date of this announcement, has an interest in 11,766,650 Ordinary Shares, representing 18.2% of the Company's issued share capital

·    £125,000 to Lee Ching Liang who, as at the date of this announcement, has an interest in 11,766,650 Ordinary Shares, representing 18.2% of the Company's issued share capital

The proceeds of the Loan Notes will be used for working capital purposes as well as widening the Company's offer to new sectors. As stated previously, the Board undertook significant cost-cutting measures and a fundamental strategic review. Steps were taken to preserve cash while seeking to reposition the business by widening its focus beyond e-commerce. While it is early days, the Company has received interest in its IT solutions it can provide for blockchain technology and digital assets. 

AIQ is looking to capitalise on a lack of IT solutions providers specialising in delivery of blockchain platforms in Asia and to take advantage of the increasing popularity of decentralised finance and NFTs in the region. Strategically, the Company hopes to build the AIQ brand as a leading project manager and IT solutions provider in the Asia Pacific market.

It is proposed that following the successful award of a contract, announced on 4 October 2021, to project manage a decentralised finance platform, the focus of the Company will be to build on this and support the management team and enable them to develop within this fast-growing sector. The initial step in this process will be to forge partnerships with key solutions providers so as to enable the Company to provide a full service, one-stop solution to potential clients.

For the year ended 31 October 2021, the Company's unaudited revenues were £60,000 (FY 2020: £154,000) and unaudited cash balances at 31 December 2021 were £540,000 (31 October 2021: £581,000). The Company's full year audited results are expected to be announced at the end of February 2022.

Terms of the Loan Notes

On 24 January 2022, the Company entered into an unsecured convertible loan note agreement with the Noteholders for a total subscription of £500,000.

The Loan Notes have an expiration date of 24 January 2024 ("Expiration Date") and can be repaid, in part or in full, by the Company on 31 December in any year prior to the Expiration Date by giving not less than 14 days' written notice to the Noteholders. All outstanding Loan Notes attract interest at a rate of 5% per annum from the date of issue (24 January 2022) to the date of repayment or conversion.

The Loan Notes shall be convertible into new Ordinary Shares of the Company at the lesser of 11 pence per Ordinary Share or the Volume Weighted Average Price of the Company's Ordinary Shares on the London Stock Exchange in the seven-day period prior to the date on which the Loan Note is converted into Ordinary Shares. The Loan Notes shall be convertible, in part or in full, at any time from the date of issue until the Expiration Date by the Noteholder giving to the Company at least one week's written notice (the "Conversion Notice").

In the event of the Company receiving a Conversion Notice in circumstances where the Company would be required to publish a prospectus in relation to the application to trading of such Ordinary Shares, the Company shall have the sole right to reject such notice. In addition, a Noteholder shall not be permitted to issue a Conversion Notice if they are in possession of any unpublished price sensitive or inside information as such terms are defined in the UK Criminal Justice Act 1993 and the Market Abuse Regulation (as in force in the United Kingdom).

Related Party Transaction

The Noteholders are deemed to be related parties by virtue of their combined shareholdings of 38.6% and Li Chun Chung being an Executive Director. Graham Duncan and Harry Chathli, being Independent Non-Executive Chairman and Non-Executive Director of the Company respectively, consider that the terms of the Loan Notes are fair and reasonable insofar as the Company's shareholders are concerned.

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