A company controlled by Michael Lee-Chin, who is the chairman of NCB Financial Group, has failed to make the final payment of US$8 million plus interest on a two-year note, which was due yesterday, August 30, sources close to the issue told Guardian Media.
On Thursday, the sources said Lee-Chin-controlled Portland (Barbados) Ltd wire transferred US$2 million to Republic Bank’s Wealth Management division, which serves as the trustee of the note, and proposed a new repayment schedule, which would extend the final payment to the week ending September 20, 2024.
Portland Barbados proposed to pay the balances of funds in the following tranches in September:
* US$2 million during the week starting on Monday, September 2;
* US2 million during the week starting September 9; and
* US$2 million, plus accumulated interest, during the week starting September 16.
Republic Bank is reported to have requested that the noteholders provide written confirmation (by reply e-mail) that they agree to the extension of the final payment to the week ending September 20, 2024, the sources said.
They said that as with previous delays in payment, interest would be charged at the default rate of 12.25 per cent per annum.
The sources also said Mr Lee-Chin offered to meet with the noteholders next week.
Lee-Chin wrote to the trustee on August 13, requesting a 15-day extension, from August 15 to 30, to make the final payment of US$8 million, which was due on August 15.
The sources said Lee-Chin told the trustee that the request for the 15-day extension was necessary because the funding arrangement to make the payment of US$8 million plus interest had been delayed until the end of August.
The August 15 payment was part of an agreement put in place by the noteholders, the trustee and Lee-Chin on May 9, following the Jamaican-born businessman failing to make the previous final bullet payment on the note on April 30, 2024.
That agreement, which was signed by Lee-Chin, required Portland (Barbados) to make a first payment of US$8 million plus interest to the trustee on or before May 29; the trustee was due to receive the second payment of US$4 million on or before June 15 with the final payment of US$8 million plus interest due to the trustee on or before August 15.
Portland (Barbados) was late in making the first two payments.
The May 9 agreement also states that the interest on the note started at 8.25 per cent. But because Lee-Chin missed the April 30,2024 bullet payment, the interest rate on the three-part arrangement was increased to 10.25 per cent, which was the interest rate specified in the supplemental trust deed of 8.25 per cent plus the default rate of 2 per cent.
“However, should the company default on any of its payment obligations as specified in this agreement, the company will pay noteholders interest at the rate of 12.25 per cent per annum, being the default rate of 2 per cent, plus the current rate of 10.25 per cent,” according to the May 9 agreement.
