HONG KONG, Dec. 10, 2013 /CNW/ - Michael Koon Ming Choi ("Mr. Choi") of
Hong Kong, China announces that the terms of the convertible redeemable
unsecured debentures of Sunwah International Limited (the
"Corporation") for a principal amount of $1,500,000 (the "Debentures")
held by Ideal Performance Limited (a corporation controlled by Mr.
Choi) have been amended by the Corporation resulting in additional
common shares of the Corporation (the "Shares") becoming issuable to
the debenture holders (the "acquisition").
On December 6, 2013, disinterested shareholders of the Corporation
approved the Shares issuable based upon the amended terms and
conditions of the Debentures to as follows: (a) the Debentures bear an
interest rate equal to 8% per annum (increased from 1% per annum); (b)
the Debentures are convertible at the holder's option into Shares at
the conversion price of $0.48 per Share (reduced from $0.55 per Share);
(c) an arrangement fee equal to 1% of the aggregate principal amount on
the Debentures will be payable on the maturity date, or such earlier
date in the event of any full conversion or full redemption of the
Debentures; (d) the Debentures are redeemable at the Corporation's
option into Shares at the redemption price of $0.48 per Share (reduced
from $0.55 per Share) if the 20-day volume weighted average price of
the Shares listed on the Toronto Stock Exchange (the "TSX") exceeds
$0.96 per Share (reduced from $1.10 per Share) and if the daily trading
volume of Shares in each of the previous 20 consecutive trading days
prior to the redemption date equal or exceed 10% of the aggregate
number of Shares to be issued upon redemption of the principal amount
(together with accrued and unpaid interest) on a cumulative basis, then
the Corporation may satisfy its obligation to make the redemption
payment by delivering that number of Shares equal to the amount due
divided by $0.48 per Share (reduced from $0.55 per Share) and that
number of Shares equal to the accrued interest thereon divided by: (i)
$0.48 per Share (reduced from $0.55 per Share), if the market price of
the Shares at the time of redemption is equal to or less than $0.60 per
Share (reduced from $0.69 per Share), or (ii) by the market price
immediate prior to the redemption date less the maximum discount
allowed by the TSX if the market price of the Shares exceeds $0.60 per
Share (reduced from $0.69 per Share); and (e) the maturity date is
September 19, 2014 (extended by one year from September 19, 2013).
The original distribution of the Debentures to Ideal Performance Limited
(a company wholly controlled by Mr. Choi) was exempt from prospectus
and registration requirements pursuant to exemptions including the
exemption set out in BC Instrument 72-503 - Distribution of Securities
Outside British Columbia.
Prior to the proposed acquisition of the Debentures, Mr. Choi directly
owned 118,937 Shares, representing approximately 0.13% of the
Immediately following the acquisition, on a fully-diluted basis, Mr.
Choi beneficially holds 3,243,937 Shares, representing approximately
3.4% of the then enlarged total issued and outstanding Shares. Upon any
redemption by the Corporation, Mr. Choi may control a maximum 3,368,937
Shares (including principal and maximum interest both payable in
Shares) representing approximately 3.5% of the then enlarged total
issued and outstanding Shares.
Dr. Jonathan Koon Shum Choi ("Dr. Choi"), who is related to Mr. Choi and
is a director of the Corporation, holds Debentures with a principal
amount of $4,500,000. Dr. Choi currently beneficially owns or controls
61,697,310 Shares and immediately following the acquisition, assuming
full conversion of only the Debentures held by him, Dr. Choi will
beneficially own 71,072,310 Shares, representing approximately 69.9% of
the then enlarged total issued and outstanding Shares. Upon any
redemption by the Corporation, Dr. Choi may control a maximum
71,447,310 Shares (including principal and maximum interest both
payable in Shares) representing approximately 70% of the then enlarged
total issued and outstanding Shares.
Immediately following the acquisition and assuming full conversion of
only the Debentures owned or controlled by Mr. Choi together with Dr.
Choi, they are expected to beneficially own or control, directly and
indirectly, 74,316,247 Shares representing approximately 70.90% of the
then enlarged total issued and outstanding Shares. After such
acquisition, Dr. Choi would remain the largest controlling shareholder
of the Corporation and there would be no effect on the control of the
Mr. Choi beneficially acquired the Debentures for investment purposes.
In pursuing such purposes, Mr. Choi takes a long-term view of the
investment. Mr. Choi reserves the right to formulate other plans or
make other proposals, and take such actions with respect to his
investment in the Corporation. Mr. Choi may at any time reconsider and
change his plans or proposals relating to the foregoing.
This press release is issued pursuant to National Instrument 62-103 -
The Early Warning System and Related Take-Over Bid and Insider
Reporting Issues, which also require a report to be filed with
regulatory authorities in each of the jurisdictions containing
additional information with respect to the foregoing matters (the
"Early Warning Report"). A copy of the Early Warning Report will
appear with the Corporation's documents on the SEDAR website, at www.sedar.com. A copy of the Early Warning Report may also be obtained by contacting
Ms. Joey Koh at +852 2538 3966.
SOURCE: Sunwah International Limited
For further information:
Kristen Humphrey, Sunwah International Group, (416) 888-2323, email@example.com