Borqs Technologies Eliminated All Debt Owed to its Senior Lender

Rhea-AI Summary

Borqs Technologies has announced completion of an $18.23 million debt purchase by LMFA Financing LLC, converting debt into 22.73 million shares. The company settled an additional $1.27 million of debt with its lender through the issuance of 1.51 million shares. This transaction has eliminated Borqs' defaulted debts totaling $19.5 million, improving its financial position.

Borqs, a leader in IoT solutions, develops customizable Android-based devices and is focused on 5G product development.

Positive

• Elimination of $19.5 million in defaulted debts, enhancing financial stability.
• Completion of $18.23 million debt purchase improves liquidity.

Negative

• Risk that some debt may not be converted as anticipated.
• Potential negative impact from coronavirus on supply chain and revenues.

SANTA CLARA, Calif., Feb. 22, 2021 (GLOBE NEWSWIRE) -- Borqs Technologies, Inc. (Nasdaq: BRQS, the “Company”), a global provider of embedded software and products for the Internet of Things (IoT), reported today that the Company as previously disclosed that the Company has entered into agreements dated December 14, 2020 with its senior lender and LMFA Financing LLC (“LMFA”), a Florida limited liability company and wholly owned subsidiary of LM Funding America, Inc. (Nasdaq: LMFA), in which LMFA will purchase approximately $18 million of debt in tranches. As of February 10, 2021, LMFA has completed the purchase of $18.23 million of principal, accrued interest and applicable fees (the “Debt”), converted into and sold all 22.73 million shares of the Company’s ordinary shares. With the Company settling another $1.27 million of Debt directly with the senior lender by the issuance of 1.51 million shares on February 17, 2021 which the senior lender subsequently sold, the Company’s defaulted Debts with the senior lender totaling $19.5 million have been eliminated.  

About LMFA Financing LLC
LM Funding America, Inc., together with its subsidiaries, is a technology-based specialty finance company that provides funding to nonprofit community associations (Associations) primarily located in the state of Florida, as well as in the states of Washington, Colorado and Illinois by funding a certain portion of the associations' rights to delinquent accounts that are selected by the Associations arising from unpaid Association assessments.

About Borqs Technologies, Inc.
Borqs Technologies is a global leader in software and products for the IoT, providing customizable, differentiated and scalable Android-based smart connected devices and cloud service solutions. Borqs has achieved leadership and customer recognition as an innovative end-to-end IoT solutions provider leveraging its strategic chipset partner relationships as well as its broad software and IP portfolio.

Borqs’ unique strengths include its Android and Android Wear Licenses which enabled the Company to develop a software IP library covering chipset software, Android enhancements, domain specific usage and system performance optimization, suitable for large and low volume customized products. The Company is also currently in development of 5G products for phones and hotspots.

Forward-Looking Statements and Additional Information

This press release may include “forward-looking statements” that involve risks and uncertainties that could cause actual results to differ materially from what is expected. Words such as “expects”, “believes”, “anticipates”, “intends”, “estimates”, “predicts”, “seeks”, “may”, “might”, “plan”, “possible”, “should” and variations and similar words and expressions are intended to identify such forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Such forward-looking statements relate to future events or future results, based on currently available information and reflect our management’s current beliefs. Many factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking statements, including the possibility that some or all of the debt may not be converted as described herein, and the negative impact of the coronavirus on the Company’s supply chain, revenues and overall results of operations, so the reader is advised to refer to the Risk Factors sections of the Company’s filings with the Securities and Exchange Commission for additional information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements. Except as expressly required by applicable securities law, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Contact:

Sandra Dou
Director of Finance
Borqs Technologies, Inc.
sandra.dou@borqs.net   
www.borqs.com

FAQ

What is the recent debt restructuring by Borqs Technologies?

Borqs Technologies completed an $18.23 million debt purchase by LMFA Financing LLC, eliminating $19.5 million in defaulted debts.

What impact does the debt elimination have on Borqs Technologies' stock?

The elimination of defaulted debts may positively impact Borqs' stock by improving its financial stability.

Are there any risks associated with Borqs Technologies' debt conversion?

Yes, there is a risk that some debt may not be converted as expected, which could affect financial results.

How is Borqs Technologies addressing potential supply chain issues?

The company acknowledges the potential negative impact of coronavirus on its supply chain and revenues.