Business Context and Reporting Period
This Form 6-K filing by Integrated Media Technology Limited (the "Company") is dated January 3, 2020. The report discloses a material event regarding the maturity of HK$23 million (approximately A$3.8 million) Convertible Bonds issued by its wholly-owned subsidiary, Marvel Digital Limited ("MDL"), on January 3, 2018. The filing addresses the Company's inability to repay the principal and accrued interest upon maturity.
Key Financial Metrics
- Debt Obligation: HK$23,000,000 principal plus accrued interest, totaling approximately A$4.2 million as of January 3, 2020.
- Liquidity Status: MDL does not currently possess the funds required to repay the Convertible Bonds and accrued interest.
- Guarantees: The Company has provided a Deed of Guarantee for MDL's payment obligations under the bonds.
- Revenue and Profit: The filing text does not provide specific revenue, profit, cash flow, or margin figures for the reporting period.
Material Changes and Events
The primary material change is the expiration of the conversion period for the Convertible Bonds on January 2, 2020, without the Bondholder exercising the right to convert into 75,000 ordinary shares of MDL. Consequently, the Put Option Deed allowing the Company to repurchase converted shares is no longer exercisable. The bonds are now due for redemption at 100% of their principal amount. The Company has formally communicated to the Bondholder that it lacks the funds for immediate repayment.
Outlook, Risks, and Management Commentary
Management is actively seeking financing alternatives and negotiating with other debt financing opportunities where repayment may be an option, though success is not certain. The Company is also in discussions with the Bondholder regarding a potential extension of the maturity date. The filing explicitly warns that if these actions fail, MDL and the Company will be liable to indemnify the Bondholder for reasonable additional costs, expenses, liabilities, and losses, including legal fees, incurred during enforcement. Investors are reminded to exercise caution when dealing in the Company's shares.
Key Facts for Investor Verification
- Confirm the current status of negotiations regarding the extension of the Convertible Bonds' maturity date.
- Verify the progress of the Company's search for alternative financing to cover the A$4.2 million obligation.
- Assess the potential impact of legal costs and indemnification liabilities if the Bondholder enforces repayment.
- Review the Company's broader liquidity position and any other undisclosed debt obligations.