Mary Chia Holdings has entered into a conditional debt capitalisation agreement (DCA) with Ho Yow Ping (or Wendy Ho), Chia Ah Tow (Mary Chia) and JL Asia Resources (collectively the participating credits) for the proposed debt conversion and issue of 25.5 million shares at a price of 15 cents per conversion share.
As at the date of the agreement, on March 1, the total amounts owed to the creditors is at $3.8 million.
Ho is the executive chairman, CEO and controlling shareholder of Mary Chia, while Chia is her mother and the former executive chairman of the group.
Both Ho and Chia had extended loans to Mary Chia for working capital purposes, where $1.5 million from Ho’s loan and some $2.1 million from Chia’s loan remains outstanding and unpaid as at March 1.
JL Asia is an associate of Lee Boon Leng, the husband of Ho. Lee is also a controlling shareholder of the company.
The group currently leases properties from JL Asia for its operations, and owes $244,000 to JL Asia in outstanding and unpaid rentals.
The conversion price of 15 cents per share is at a 6.7% discount of the weighted average price of the company’s shares on March 1 of 16.07 cents.
The price was arrived at after considering the group’s prevailing market conditions and financial performance.
Under the agreement, Ho, Chia and JL Asia will be allotted 9.8 million shares, 14.1 million shares and 1.6 million shares respectively.
The conversion shares represent 12.6% of the existing share capital of the company, and 11.15% of the company’s enlarged share base.
The proposed issuance of conversion shares constitutes as an interested person transaction.
Shares in Mary Chia closed flat at 17 cents on March 2.
