United Paragon Mining Corp. (UPMC) is moving forward with a major debt-to-equity conversion as part of its financial rehabilitation, following an agreement involving Camarines Minerals Inc. (CMI) and two newly formed investment holding firms.
UPMC said it has paid P35.03 million to CMI to partially settle its obligations, reducing its total outstanding accrued debt to CMI to P603.86 million. As part of subsequent restructuring talks, CMI agreed to convert P400 million of UPMC’s remaining debt into equity in the listed company at a par value of P0.01 per share, equivalent to 40 billion new common shares to be issued from UPMC’s unissued authorized capital stock, subject to regulatory approvals.
CMI later assigned the outstanding debt to Oro Mina Holdings Inc. and Golden Lotus Holding Corp., which have agreed to assume the residual debt and subscribe to the shares arising from the conversion. Oro Mina will take up two-thirds of the converted amount, subscribing to 26.67 billion shares worth P266.67 million, while Golden Lotus will subscribe to 13.33 billion shares valued at P133.33 million.
Payment for the shares will be made through the application of debt credits assigned to the two firms under a Deed of Assignment executed last December 22. Both Oro Mina and Golden Lotus were incorporated on December 16, as non-operating investment holding companies and were organized solely for investment purposes. They currently have minimal paid-up capital of P600,000 each and no operating history.
UPMC is preparing to file a Notice of Application for Confirmation of Exempt Transaction with the Securities and Exchange Commission, followed by an application for the additional listing of the subscribed shares with the Philippine Stock Exchange.
The transaction forms part of UPMC’s broader restructuring program aimed at addressing its negative equity position while complying with SEC and PSE requirements. The company said the conversion will not result in a transfer of control.
