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17 April 2020 : GL and Creation reschedule Convertible Debenture repayment; GL expects to use financial flexibility to get through COVID-19 situation even stronger

GL and Creation reschedule Convertible Debenture repayment; GL expects to use financial flexibility to get through COVID-19 situation even stronger

17 Apr 2020

Creation Investments held $20 million in convertible debentures (CD) due 30 March 2020. Earlier this month, Group Lease and Creation mutually agreed to reschedule the repayment over the course of this year instead of one lump sum payment. This will allow Group Lease more flexibly in managing cash flow during the Covid-19 epidemic, which besides affecting the economies in which Group Lease operates, has also resulted in delays in legal proceedings and court decisions. After a series of legal victories including in Singapore and Thailand, we were expecting further decisions during this year, however courts in both Singapore and Thailand will delay their decisions due to Covid-19.

We appreciate our partner Creation for continuing to work with us and giving us additional financial flexibility. We have had a professional relationship with them for many years and it is reassuring to have a business partner that can work with us during these challenging times.

As a result of Group Lease and Creation agreeing to a gradual repayment this year, Group Lease repaid $7.5 million in principal on 14 April 2020 plus interest due per the terms of the original CD agreement. Furthermore, Group Lease will repay $2.5 million in principal monthly starting May 2020, concluding the full repayment in September 2020. Interest will accrue at 7% per annum and will be due along with the final principal payment in September 2020.

While the impact of the COVID-19 epidemic on the global economy is currently unknown, we are maintaining full business operations in compliance with the current lockdowns in some of our markets. We have maintained full employment so far and anticipate no layoffs or business reduction due to the conservative approach we took during the 2018 and 2019 period. The cost efficiencies and reduction of our business size plus the additional flexibility from our agreement with Creation will put Group Lease in a better position to emerge stronger and better prepared from the COVID-19 impacts once the strictest economic restrictions have dissipated.

We have been fighting various issues for the last 2 years and while it has been difficult, it forced us to be more disciplined, focused and able to adapt to a changing environment. These lessons, have readied us to deal with the current COVID-19 environment and they will allow us to continue to fight, survive, and thrive.

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SET Announcements

16 April 2020 : Notification of progress on Convertible Debentures to Creation Investments Sri Lanka LLC

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SET Announcements

27 March 2020 : The Postponement of Announcement of Annual General Meeting of Shareholders 2020 and Non-payment of Dividend

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SET Announcements

27 March 2020 : The postponement of Annual General Meeting 2020 and non-payment of dividend (Revise topic)

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SET Announcements

25 March 2020 : Group Lease Public Company Limited terminates CD issued to J Trust Asia Pte. Ltd.

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SET Announcements

23 March 2020 : Postponement of the Company’s Annual Holidays

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Press Releases

23 March 2020 : $50 million CD to JTA Terminated, Any Potential Payment Now a Matter for the Courts of Thailand

$50 million CD to JTA Terminated, Any Potential Payment Now a Matter for the Courts of Thailand

23 Mar 2020

On February 28, 2020, Group Lease sent a notice to JTrust Asia notifying JTA that they had breached the Investment Agreement for the $50 million convertible debenture with GL. JTA has intentionally and in bad faith engaged in various actions to obstruct GL’s the use of these funds and interfered with GL’s business operations. On March 16, 2020, GL sent a Notice of Termination to JTA for the $50 million CD on account of JTA’s failure to remedy any damages against which GL has suffered from JTA’s wrongful acts.

Additionally, JTA claimed in Thailand that the CD is void. Thus under JTA’s view, the CD no longer has any terms or obligations between JTA and GL, including no maturity. Both GL and JTA now agree that the CD is either void or terminated. Therefore, the obligation of GL to JTA is unclear and is now a matter for the courts of Thailand.

GL would like to make clear that we have the complete capacity to repay the original principal and interest, however due to the actions taken by JTA and under Thai law, any payments by GL to JTA would be deemed as groundless payments and GL would not be entitled to recognize the amount paid. So GL must now wait until the issue is resolved by the Thai courts before paying any amount.

JTA has had its rehabilitation claims in Thailand dismissed multiple times and JTA was recently ordered to pay damages of THB 685.5 million to GL as the court found that JTA acted in bad faith by filing a false rehabilitation against GL. JTA also claimed in Singapore that GL dishonestly misrepresented its financials, but the Singapore High Court dismissed all of JTA’s claims last month. JTA’s actions have not been defensible and have been used in bad faith specifically to cause harm to GL.

These actions and others by JTA have caused severe financial and reputational damage to GL as well as its subsidiaries and related parties. GL reserves the right to claim further damages against JTA and GL will not hesitate to exercise such rights to fulfil our obligation to our shareholders and stakeholders, however we welcome JTA to work with us on a solution to our issues rather than them continuing their bad faith legal strategy.

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SET Announcements

17 March 2020 : Announcement of Annual General Meeting of Shareholders 2020 and Non-payment of Dividend

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Press Releases

06 March 2020 : Thai Courts rule JTA acted in bad faith, orders JTA to pay THB 685.5 million to GL

Thai Courts rule JTA acted in bad faith, orders JTA to pay THB 685.5 million to GL

06 Mar 2020

On March 5, 2020, the Civil Court in Thailand ruled that that JTA acted in bad faith by filing the false rehabilitation petition against Group Lease in Thailand. The Court also ruled that JTA’s actions caused damages and ordered JTA to pay THB 685.5 million, including lawyer fees, to GL as of March 5, 2020.

GL took civil action against JTA due to JTA’s unjustified attempt to force GL into rehabilitation, even though it is clear GL does not meet the standards for rehabilitation. On August 15, 2019, the Central Bankruptcy Court dismissed the JTA submitted rehabilitation petition against GL for the second time. The court looked at three factors when deciding to dismiss the case:

  1. The amount of GL debt owed to JTA
  2. The amount of GL’s assets compared to GL’s liabilities
  3. The ability of GL to operate the business

Upon looking at those three factors, the court ruled that the amount GL owes JTA is unclear due JTA’s legal actions, GL has assets exceeding its liabilities and therefore is not insolvent, and finally that GL was able to operate the business as usual and therefore dismissed JTA’s petition.

We are pleased the Civil Court agreed that JTA acted in bad faith and caused damage to our company. We hope JTA learns from this case and stops litigating in bad faith. After last month’s decision at the High Court of Singapore in the favor of Group Lease, and today’s decision, it strengthens our argument to continue to fight for compensation for all damages JTA has done and continues to do to GL.

 

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SET Announcements

05 March 2020 : Decision of Civil Court regarding Group Lease Public Company Limited filed a civil case against JTrust Asia Pte. Ltd, alleging the wrongful acts and claim for compensation