SCHEDULE 13D/A: MKDWELL Tech CEO Increases Stake to 7.1% Through Debt-to-Equity Conversion and Share Reclassification

MKDWELL Tech Inc.'s CEO and Chairman, Ming-Chia Huang, has increased his beneficial ownership to 7.1% of the company's outstanding shares, primarily through the conversion of $823,100 in debt into Class A preferred shares with enhanced voting rights.

Summary

• Ming-Chia Huang, the Chief Executive Officer and Chairman of MKDWELL Tech Inc., beneficially owns 10,196,350 shares, representing 7.1% of the company's total outstanding shares.
• His ownership comprises 1,965,350 ordinary shares and 8,231,000 Class A preferred shares.
• Each ordinary share is entitled to one vote, while each Class A preferred share is entitled to 100 votes.
• The increase in ownership is partly due to a business combination where Mr. Huang received 1,965,350 ordinary shares.
• A significant portion of his stake, 8,231,000 shares, resulted from a debt conversion agreement dated March 19, 2025, where $823,100 owed to Mr. Huang was converted into equity.
• These 8,231,000 ordinary shares were subsequently redesignated as Class A preferred shares on May 22, 2025.

Sentiment

Score: 5

Explanation: The document is a factual disclosure of beneficial ownership and related transactions. It does not contain subjective language to indicate positive or negative sentiment, but the implications of concentrated voting power and potential corporate actions can be interpreted differently by stakeholders.

Positives

• The conversion of $823,100 in debt owed to the CEO into equity strengthens the company's balance sheet by reducing liabilities.
• Increased beneficial ownership by the CEO and Chairman, Ming-Chia Huang, may signal strong confidence in the company's future prospects and alignment of interests with long-term success.

Negatives

• The redesignation of 8,231,000 shares into Class A preferred shares, each carrying 100 votes, significantly concentrates voting power in the hands of the CEO, potentially diluting the influence of ordinary shareholders.
• The potential for the Reporting Person to explore extraordinary corporate transactions, such as a take-private transaction or delisting, could lead to outcomes unfavorable to minority shareholders.

Risks

• The Reporting Person, as CEO and Chairman, may have significant influence over corporate activities, including potential extraordinary corporate transactions like mergers, reorganizations, or take-private transactions that could result in delisting or deregistration of Ordinary Shares.
• There is a risk of changes to the Issuer's capitalization or dividend policy, or other material changes to the Issuer's business or corporate structure, including changes in management or the composition of the Board, initiated or influenced by the Reporting Person.

Future Outlook

The Reporting Person, as CEO and Chairman, may acquire additional securities, sell existing holdings, or engage in discussions with management and the Board to explore extraordinary corporate transactions such as mergers, reorganizations, take-private transactions, sales or acquisitions of assets/businesses, or changes to capitalization/dividend policy. While no present plans for such actions are stated, the Reporting Person retains the right to change his investment intent.

Management Comments

• "The Reporting Person may acquire additional securities of the Issuer, or retain or sell all or a portion of the securities then held, in the open market or in privately negotiated transactions."
• "The Reporting Person may engage in discussions with management, the Board and other securityholders of the Issuer and other relevant parties or encourage, cause or seek to cause the Issuer or the relevant parties to consider or explore extraordinary corporate transactions, such as a merger, reorganization or take-private transaction that may result in the delisting or deregistration of the Ordinary Shares; sales or acquisitions of assets or businesses; changes to the capitalization or dividend policy of the Issuer; or other material changes to the Issuer's business or corporate structure, including changes in management or the composition of the Board."

Industry Context

NA

Corporate Governance

Related Party Transactions

• MKDWELL Tech Inc. entered into a debt conversion agreement with Mr. Ming-Chia Huang, a director and the chief executive officer of the Company, converting $823,100 owed to him into equity.
• Similar debt conversion agreements were also made with Ms. Ya-Hui Wu, the spouse of Mr. Huang, and AWinner Limited, which is controlled by Mr. Chung-Yi Sun, another director of the Company.

Stakeholder Impact

• **Shareholders:** Ordinary shareholders may experience a dilution of their voting power due to the creation and issuance of Class A preferred shares with 100 votes per share to the CEO. The potential for future extraordinary corporate transactions (e.g., take-private) could significantly impact their investment.
• **Creditors:** The conversion of debt to equity reduces the company's liabilities, which could be viewed positively by remaining creditors as it strengthens the balance sheet.

Next Steps

• The Reporting Person may acquire additional securities or sell existing holdings in the open market or privately.
• The Reporting Person may engage in discussions regarding potential extraordinary corporate transactions, including mergers, reorganizations, take-private transactions, asset sales, or changes to capitalization/dividend policy.

Key Dates

Keywords

MKDWELL Tech Inc., Schedule 13D, beneficial ownership, debt conversion, Class A preferred shares, corporate governance, voting rights, insider ownership, SEC filing, Ming-Chia Huang