IN response to queries from the SGX Regulation (SGX RegCo), No Signboard Holdings said the move to enter into a deal with Q&M Dental's chief executive Ng Chin Siau is intended to form a key part of the company's trading resumption proposal.

In a bourse filing on Thursday (Mar 10), the restaurant operator said that it, along with its controlling shareholder GuGong, is currently focused on finalising agreements with Ng and investors to raise the financing the group requires to address its going concern issues.

In the event that No Signboard is unable to enter into the loan agreements with Ng and other investors to raise the necessary financing, it will then move to discuss other alternatives with its financial adviser, said the company.

On Mar 7, it was announced that Ng had entered into a sale and purchase agreement (SPA) to take a 29 per cent stake in No Signboard for a total consideration of S$1. There was also an agreement for Ng to extend an interest-free unsecured loan of S$2.6 million to the company as a condition for the completion of the proposed share transfer.

GuGong, which currently holds a 54.9 per cent stake in No Signboard, has the company's chief executive Lim Yong Sim, and chief operating officer Lim Lay Hoon as shareholders and directors. Following the share transfer, GuGong's stake will fall to just 25.9 per cent.

Both Lim Yong Sim and Lim Lay Hoon will remain in their current positions after the share transfer, said No Signboard.

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In its response to the bourse regulator's queries, No Signboard said the disbursement of the S$2.6 million loan will be conditional upon the company and GuGong being able to secure additional financing to resolve the group's going concern issues.

The company currently expects to receive the funds following the approval of its trading resumption proposal and completion of the proposed share transfer.

When asked to explain how the consideration of S$1 for a 29 per cent stake was arrived at, No Signboard said the loan agreement would provide the company with "a substantial infusion of interest-free and unsecured funding" to assist with its working capital needs, especially since it sounded a warning on Jan 24 that it is unable to demonstrate the ability to continue as a going concern.

In response to SGX RegCo's query on how the company intends to comply with the requirements of the Catalist rules, No Signboard said it is aware of the listing rules and will detail its plans and milestones in its trading resumption proposal which will be submitted to SGX RegCo upon the execution of the relevant agreements with investors.

No Signboard and the company are currently in "advanced negotiation" with investors to secure additional funding to meet working capital needs, and intend to "agree on the terms of the loan agreements with the respective investors" which will form part of the trading resumption proposal, said the company.

SGX RegCo also asked No Signboard to elaborate on Ng's plans for the company, as well as whether he or his nominees will be appointed to the board of directors or key management positions.

No Signboard said there is no agreement for Ng or his nominees to be appointed to such positions, and that it is committed to focusing on its existing businesses and expects the demand for these businesses to improve with the gradual easing of Covid-19-related restrictions such as travel and dining-related ones.

The firm said it may explore new areas of opportunities should the opportunity arise to increase its revenue streams, although it has not identified or begun any negotiations on such opportunities.

Ng's plans, said the company, are "consistent" with those of the company, adding that Ng's "main motivation" for entering into the share transfer is to "revive an iconic Singapore brand".