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A loan in the form of supplement investment agreement was acquired by the listed food service company Pancake House Inc.  The total amount of loans was P140 million, in which the company will issue the said amount in convertible loans to two Asia-based funds.

The proceeds of the loan will be used to pay for the firm’s capital expenditures and retirement of debt.

The Pancake House, in its disclosure to the Securities and Exchange Commission, said it has approved a supplemental investment agreement with Aureos Southeast Asia Fund Llc and Aureos Malaysia Fund Llc.

Pancake House said, “Under the supplemental investment agreement, the investors agree to purchase five-year convertible notes to be issued by the corporation with an aggregate issue price of the Philippine peso equivalent of $3 million.”

According to the food service company, the notes may be converted to over 21 million common shares at a price of P6.50 each. The common shares also represent 8.26 percent in Pancake House.

“The notes are convertible at the option of the investors in minimum lot sizes of $1 million at any time during the five-year term to common shares,” said the company.

Martin Lorenzo, Pancake House chairman, said in an earlier interview that the company will be opening 31 new stores this year, half of which will be franchised out. To be opened are 11 new Le Coeur de France cafés, bringing the total number to 25; 14 new stores of Sizzlin’ Steak, making them 19; and 6 Pancake House restaurants, bringing total number to 76.

Lorenzo also said Pancake House will spend P150 million this year, where the P100 million will go to new stores, P40 million for the upgrade of commissaries and the remainder allotted to other expenses. The company chairman added that Pancake House is targeting a “prudent” 10 to 15 percent growth in sales in 2009 over last year’s P1.85 million.