MANILA – STI Holdings Inc. has issued notices of default against the Philippine Women's University (PWU) and its sister company, Unlad Resources Development Corporation, for allegedly failing to meet its financial obligations with STI since 2011.
STI is requiring PWU to pay the outstanding balance of a loan under the Omnibus Agreement and the loan under the Facility Agreement amounting to P702 million and Unlad the amount of P223 million covering interest, penalties, lawyers' fees and value added taxes within seven days.
The notices were delivered to PWU and Unlad on Tuesday, December 9.
In the notice, STI also demanded three-fourths of the outstanding general membership of PWU and three-fourths of the seats in the PWU Board of Trustees.
STI said the loans under the Omnibus Agreement and Facility Agreement are also secured by the following:
“Mortgage over five (5) parcels of land over which the PWU School is located with a total area of 7,694.18 square meters, more or less, together with all the buildings and improvements thereon, located at the corners of Taft Avenue, Julio Nakpil, Leon Guinto, Sr. and Gen. Malvar Streets, Barangay 694, Zone 75, District 5, Malate, Manila, registered under the name of PWU;
Mortgage over two (2) parcels of land over which PWU Jose Abad Santos Memorial School (JASMS) is located with a total area of 10,702.20 square meters, more or less, together with all the buildings and improvements thereon, located at EDSA, Diliman, Quezon City, registered under the name of Unlad Resources Development Corporation (“URDC”);
Mortgage over a land with a total area of 1,051.10 square meters, more or less, together with all the buildings and improvements thereon, located at Pilar Hidalgo Lim (formerly, Indiana) Street, Barangay 703, Zone 77, District V, Malate, Manila, registered under the name of PWU; and continuing Suretyship of URDC."
In 2011, STI bailed out PWU when it was about to be foreclosed by BDO by purchasing debt paper from the bank worth P223 million and lent the school another P26.5 million. It also lent P198 million to Unlad.
"We came to help PWU and expect to get paid through shares of stocks. After three years of waiting, it now appears the other party has no intention of living up to its end of the agreement. The notices of default were a last resort but necessary to protect the interest of the company and its shareholders," STI said in a statement.
STI added that if the Benitez Group fails to pay within the deadline, STI “is invoking its agreements which require the Benitez Group to deliver to STI control of PWU's general membership and board of trustees, and the real properties of PWU and Unlad, including the Manila and Quezon City campuses.”
Dr. Francisco Benitez, who serves as PWU president and Unlad chair, called for the termination of the joint venture agreement with STI in November during a joint board meeting.
PWU has yet to comment on the notice of default.