SINGAPORE (THE BUSINESS TIMES) - Ahead of its moratorium hearings on Thursday (May 26), No Signboard Holdings announced that it was extended a lifeline by Gazelle Ventures which has agreed to invest up to $5 million in the debt-ridden restaurant operator.
Gazelle Ventures, which invests in food, agri-tech and sustainable agriculture-related businesses, is a Singapore-incorporated company jointly owned by Gazelle Capital and Valiant Investments. (See correction note)
In the event the company winds up, the investor will get preferential liquidation rights for the rescue financing, according to the agreement terms which No Signboard disclosed in a bourse filing on Wednesday (May 25).
The High Court was scheduled to hear moratorium requests by the company and two of its subsidiaries, NSB Hotpot and NSB Restaurants, at 2.30pm on Thursday.
On April 29, the trio had applied for moratorium relief spanning six months under Section 64 of the Insolvency, Restructuring and Dissolution Act.
The court orders being sought are to ensure that no resolution is passed to wind up the companies and that no legal process shall be commenced or continued against any property of the applicants, among other things.
Specifically in No Signboard's application, it has requested that OCBC Bank, which is the creditor of $3 million under a temporary bridging loan facility extended to the company in April 2020, be excluded from the terms of the moratorium order.
In the bourse filing on Wednesday, No Signboard said it entered into a memorandum of understanding for up to $5 million in super priority financing with the investor on April 30.
On May 24, the company then entered into an agreement to take up the offer, with a principal amount of $450,000 as an interim measure to obtain immediate and urgent short-term financing for its working capital requirements.
The rescue financing was intended to precede the disbursement of the balance of the investment amount by the investor, it pointed out, while noting that no interest is payable on the principal amount.
Trading of No Signboard's shares has been suspended since Jan 24, 2022.
For correction note: An earlier version of this story stated that the investor was not named, but it was named in another bourse filing by No Signboard on May 1. The article has been revised to reflect this.