Bellevue Life Sciences Acquisition Corp. (NASDAQ:BLAC), a company specializing in surgical and medical instruments, has entered into an agreement with Duksung Co., LTD., issuing an unsecured promissory note valued at $800,000, as disclosed in a recent SEC filing. The note, dated October 16, 2024, carries a simple interest rate of 5% per annum, with a provision that for prepayment purposes prior to redemption, interest will be deemed to have accrued at 7% per annum.
The promissory note is set to mature on October 15, 2025, unless it is converted or redeemed earlier. The agreement stipulates an automatic conversion of the note into Bellevue Life Sciences common stock if a Qualified PIPE Financing occurs before March 31, 2025. The conversion would settle the note in full, with the number of shares being determined by dividing the total principal and accrued interest by $8.10 per share.
If a Qualified PIPE Financing does not transpire by the specified date, Bellevue Life Sciences retains the option to prepay the note, in whole or in part, anytime thereafter. The prepayment would include the principal and any unpaid interest, calculated at the 7% rate from the issuance date.
This move reflects Bellevue Life Sciences' strategic financial management as it navigates its growth and financing options. The details of this financial obligation are outlined in Exhibit 10.1 of the 8-K filing, which provides investors and stakeholders with full transparency regarding the terms of the agreement.
In other recent news, Bellevue Life Sciences Acquisition Corp. has issued a $40,000 unsecured promissory note to board member Jun Chul Whang, to be paid in full by November 9, 2024, or upon the company raising additional working capital funds or completing an initial business combination. The company also extended the maturity dates of promissory notes held by board members Jun Chul Whang and Josh Pan, providing additional flexibility in its financial planning.
In a move to extend the deadline for a pending business combination, Bellevue Life Sciences deposited $50,000 into its trust account. The company also issued a non-interest bearing promissory note for $300,000 to its sponsor, Bellevue Global Life Sciences Investors, LLC, due by the end of 2024 or upon the completion of the company's initial business combination.
However, the company has been grappling with non-compliance issues with Nasdaq's minimum public holders requirement, which could potentially lead to the suspension or delisting of its securities. Bellevue Life Sciences plans to request a hearing before a Nasdaq Hearings Panel to address these issues.
In terms of leadership changes, Bellevue Life Sciences Acquisition Corp. has appointed Mr. Sang Hyun Kim to its Board of Directors. These are among the recent developments for Bellevue Life Sciences Acquisition Corp.
InvestingPro Insights
Bellevue Life Sciences Acquisition Corp.'s recent financial move can be better understood in light of some key InvestingPro data and tips. The company's market capitalization stands at $44.21 million, indicating its relatively small size in the market. This context is crucial when considering the $800,000 promissory note, which represents a significant financial commitment relative to the company's market value.
InvestingPro Tips reveal that BLACU is not profitable over the last twelve months and suffers from weak gross profit margins. These insights align with the company's need for additional financing through the promissory note. The tip that the stock generally trades with low price volatility suggests that this financing move might not lead to significant short-term price fluctuations.
It's worth noting that BLACU is trading near its 52-week low, which could indicate current market skepticism. This information, combined with the fact that short-term obligations exceed liquid assets, underscores the importance of the recent financing for the company's operations and potential growth strategies.
For investors seeking a more comprehensive analysis, InvestingPro offers 7 additional tips for BLACU, providing a deeper understanding of the company's financial health and market position.
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