Ooway says no conditions tied to S$1.5m interest-free loan offered to Kitchen Culture
Vivienne Tay
OOWAY Group on Thursday (Oct 20) said its S$1.5 million interest-free loan offered to Kitchen Culture did not come with any pre-conditions, contrary to what the latter has said.
Its clarification comes nearly a week after the board of Catalist-listed Kitchen Culture claimed Ooway Group had made statements with various “factual inaccuracies and mischaracterisation of events”.
Kitchen Culture alleged in its Oct 14 statement that the S$1.5 million interest-free loan offered by Ooway Group to help the company meet its general working capital requirements came with a pre-condition that a specific candidate had to be appointed the company’s chief financial officer.
Kitchen Culture said it could not accept the condition after its board’s nominating committee found the candidate unsuitable.
The company subsequently sought urgent funding from other sources after balance proceeds from past fundraising activities started to fall to a “precariously low level of S$26,559”. At the same time, liabilities accumulated under the management of former executive director and interim chief executive Lincoln Teo swelled to about S$935,000.
This led to Kitchen Culture entering into an agreement with lender Tan Gin Tat for a S$1 million loan, so that it can meet its anticipated general working capital requirements until the end of 2022. The loan came with a term of one year and an interest rate of 10 per cent per annum.
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In its latest statement on Thursday, Ooway Group noted that the terms for its S$1.5 million loan included a loan tenor of one year from the first drawdown date, no interest being payable, and Ooway having the option to extend its loan tenor or convert the loan to equity shares of Kitchen Culture after the initial term expires.
“This proposed unconditional interest-free loan was not accepted by the board of Kitchen Culture for reasons unknown to us,” said Ooway Group representative Liu Yanlong.
The company has invited Kitchen Culture’s board to further clarify and circulate the final version of its term sheet dated Jun 8, 2022, to shareholders.
SEE ALSO
Ooway Group is a corporate entity with a stake in Big Data credit management firm Ooway Technology, in which Kitchen Culture has a 30 per cent stake.
Kitchen Culture’s board on Sep 30 received a notice from Ooway Group and seven individuals who own an aggregate of 21.71 per cent of the company’s shares asking for five of its directors to resign. Among these shareholders, Ooway Group holds the largest stake in Kitchen Culture at 21.19 per cent.
Trading in the shares of Kitchen Culture has been suspended since Jul 12, 2021.
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