MAS and SGX RegCo To Safeguard Interests Of Eagle Hospitality Trust’s Unitholders
April 21, 2020 — The Monetary Authority of Singapore (MAS) announced today that it has directed the Manager of Eagle Hospitality REIT (EH-REIT), and its Trustee, to take steps to protect the rights and interests of EH-REIT’s unitholders. MAS and the Singapore Exchange Regulation (SGX RegCo) are also looking into possible breaches of relevant laws and regulations as well as listing rules in relation to the issues surrounding EH-REIT.
Trading of Eagle Hospitality Trust (EHT) units was voluntarily suspended on 24 March 2020, after EH-REIT defaulted on a loan of US$341 million. As a result of the default, EH-REIT was restricted by the terms of its loan agreement from making payment of declared dividends to its unitholders. The loan default followed the failure of Urban Commons LLC, the master lessee of EHT’s properties, to (i) place with EHT the full sum of security deposits due under the master lease agreements, and (ii) make timely rental payments since December 2019.
To safeguard the interests of unitholders of EH-REIT, MAS has directed the Manager of EH-REIT to obtain the approval of the Trustee before making any payments or transfers of EH-REIT’s funds. MAS has also directed the Manager of EH-REIT to restore its minimum base capital and financial resources to comply with MAS’ requirements; the Manager has been in breach of these requirements since December 2019. MAS has directed the Trustee to ensure that the Trustee’s approval is obtained before any payments or transfers of funds is made from EH-REIT to any person. The Trustee is also required to set out the actions that it will take to protect the interests of unitholders.
For full statement, read here.