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Ezion enters into loan agreements with secured lenders, completes issue of warrants and consent shares
OFFSHORE and marine company Ezion Holdings on Tuesday said it has entered into loan agreements with all secured lenders pursuant to its refinancing exercise, and the extension of additional working capital of up to US$118 million.
In addition, the issue of its proposed warrants to secured lenders and TLF (term loan facility) consent shares have also been completed on July 2.
The loan agreements to its secured lenders provide for minimal fixed principal repayments over a six-year refinancing period, as well as a reduction of interest rate.
According to the agreements, the company undertakes that there will be no change to the firm's CEO without prior written consent of the secured lenders.
Another clause stipulates that Ezion's CEO, Chew Thiam Keng, shall at all times own a minimum of about 217.6 million shares, constituting a 5.96 per cent stake in the firm. Should there be a breach of this condition, the aggregate amount of facilities that may be affected is about US$1.29 billion as at July 2, Ezion said.
Pursuant to the loan agreements, a share charge will also be executed by Mr Chew and his family in respect of up to 100 million of their personal ordinary shares in the company. These will be distributed among the secured lenders, so that lenders may claim these shares in the event of a default. As at July 2, 100 million shares in Ezion represent about 2.74 per cent of the firm's issued and paid-up share capital.
Separately, the group added that 134.9 million warrants that are non-listed but transferable, have been issued free of charge by the company to secured lenders on July 2.
Further, about 51.8 million TLF consent shares have been issued on Monday to the secured lenders in return for their refinancing of the group's existing debt. These shares will be listed on the Singapore Exchange's mainboard on, or around July 4, Ezion said. The additional shares represent about 1.4 per cent of the firm's enlarged share capital as at June 14.
Ezion shares were trading flat at 8.5 Singapore cents apiece as at 10.42am on Tuesday. Some 22.1 million shares exchanged hands, making it one of the most heavily traded counters on the Singapore bourse in early morning trade.