CHAL.L Regulatory News (CHAL)

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18 January 2018

Challenger Acquisitions Limited

("Challenger" or the "Company")

Investment in New Giant Observation Wheel Project:

The Eye of Texas

Challenger Acquisitions Limited (LSE: CHAL) is pleased to announce that it has it has invested US$300,000 ("the Investment") in a new Giant Observation Wheel ("GOW") project in Dallas, Texas called the Eye of Texas, LLC ("EOT"). This is in line with the Company's strategy to acquire and/or take interests in strategic growth opportunities in the leisure and attractions sector that offer both near and long-term revenue generation prospects, and complements Challenger's equity stake in the New York Wheel.

Highlights

· Challenger has invested US$300,000 for pre-development costs of the Eye of Texas GOW

o Opportunity to invest, at Challenger's option, up to US$1 million in this first tranche

o Balance of the total pre-development costs of US$3 million is being raised by local developers

· Highly experienced team of real estate professionals and commercial/residential developers have been working on the EOT for three years, during which time significant equity has been invested and planning has commenced

o A seven-acre parcel of land has been contractually secured for the EOT in the Dallas-Fort Worth area (population 7.2 million - 2016 census)

o The redevelopment plan for the area is expected to include an entertainment complex and significant improvements to mass transportation to be developed by third parties

o Preliminary planning for the height of the EOT is 165 meters (the London Eye is 125 meters)

· Challenger has the opportunity to operate the EOT once the GOW has been constructed

· Investment complements Challenger's US$3 million equity stake in the NY Wheel Project - a large entertainment complex currently being built on the New York Harbour, which will feature a 630ft GOW, a 75,000 sq ft terminal and retail building, a 950-space parking garage and a 5,000-person capacity green roof for events

Mark Gustafson, Challenger's Chief Executive Officer, stated, "We are incredibly excited to have now made an investment in our second Giant Observation Wheel Project, marking an excellent start to 2018. The Eye of Texas is highly complementary to our investment in the New York Wheel. An entertainment complex and the improvements to mass transportation will attract tourists outside of this highly populated area of ~7.2 million people, and as such we anticipate strong traffic to the EOT. As discussions and work programmes progress we look forward to updating investors on the status of the project."

Challenger's Investment

The Company has the option to invest up to US$1 million in the pre-development costs for the Eye of Texas, which are expected to include planning (architectural, structural, geotechnical, civil, environmental), legal (lending, land use, construction), city costs (fees, taxes), and corporate costs (attendance studies, initial staffing). The first tranche is for US$300,000 and the Board of Challenger has the right to determine whether or not funding continues for future tranches.

The initial Investment consists of a convertible note from EOT with a 24-month term, 9% interest rate, and is convertible into membership interests, which the Company estimates would convert today into an equity position of approximately 4%.

Challenger also has the opportunity to be the operator of the wheel when it becomes operational.

Funding Summary

In order to fund the EOT investment, Challenger has received the remaining £400,000 (£380,000 net of fees) from the previously announced £1,000,000 unsecured convertible note facility due 8 June 2019 ("Note Facility"). This Note Facility was announced on 13 June 2017 and restated below.

Principal terms of the Note Facility

· The convertible note is unlisted, unsecured, transferable and must be redeemed by the Company on 8 June 2019, in cash unless it has been fully converted by then into ordinary shares of the Company ("Ordinary Shares")

· There are no conversions for the first 120 days, unless waived by the Company

· The maximum amount that can be converted in any 30-day period is 20% of the principle amount, unless waived by the Company

· Subject to the conversion limitations noted above, the noteholder may exercise a conversion at the lowest volume weighted average price over the 10 days prior to the conversion ("Conversion Price")

· Interest is accrued at 8% per annum and payable upon conversion, at the Company's option in:

o cash; or

o by issuing Ordinary Shares in respect of such accrued interest conversion amount at the Conversion Price.

· At any time the Company can redeem in cash all or any part of the outstanding convertible note from the holder at a 25% premium to the principal amount of such notes

This announcement contains inside information.

**ENDS**

For more information visit www.challengeracquisitions.com or enquire to: