SINGAPORE - The entire board of International Healthway Corp (IHC) was voted out on Monday after clashing with shareholders at a lengthy and at times chaotic extraordinary general meeting (EGM) marked by fraying tempers and loud interjections by angry investors.
The embattled directors faced more than 100 shareholders and proxy holders in the 90-minute crossfire, which began the moment one proxy holder suggested that the meeting be adjourned to the end of March so as not to jeopardise the board's refinancing efforts.
IHC had warned in a surprise announcement that morning that its financial adviser would not entertain a change in the company's board.
Without the refinancing, the medical property developer is unlikely to be able to repay a $50 million bond due in April, IHC executive director Angeleca Lim told the meeting.
The suggestion to adjourn the EGM drew a loud "no" from the floor. The stated agenda of the meeting had been to replace the board.
As tempers flared, IHC co-founder Jong Hee Sen, who resigned from the board last month, moved to clarify matters.
"The Japan assets are built up by me... The announcement said the financing will not go on if there's a change of board members," he said.
"I don't think this is true. I don't think such a clause exists in any of the loan documents. I also don't think any of the financiers has met any of these board members."
This drew applause which turned quickly to jeers as non-independent chairman Gerald Lim Thien Su pressed for the adjournment to be put to vote by a show of hands.
Voting by poll is regarded by some as more transparent and equitable since every share would count for one vote, whereas a vote by show of hands is vulnerable to abuse if one side can gather enough proxy holders.
Although the Singapore Exchange has mandated that all resolutions at general meetings held by firms listed here must be voted by poll, the adjournment of an EGM is not considered a resolution.
This point was debated for a long time, with IHC legal adviser Yoong Nim Chor telling one shareholder coolly: "If you want to engage me in a legal discussion, we can do that outside."
Oxley deputy chief Eric Low was the most vocal as he paced about the room, visibly irking Ms Lim who muttered for the mic to be take from him. Mr Low had requisitioned the meeting last year, citing IHC's "worrying performance" .
Even the Catalist sponsor for IHC, PrimePartners Corporate Finance, was dragged in.
Mr Mark Liew, its chief operating officer, advised the board: "Those shareholders who believe that the current board should stay on are free to vote against the resolutions. Your rights are not in any way affected.
"But to put now, the cart before the horse and say that we asked the shareholders to come, we took an additional 45 minutes to get everything set up (the meeting started 45 minutes late), and your first point of order is to debate an adjournment. My advice to the board is that's not very good governance."
Oxley boss Ching Chiat Kwong also took the floor: "I can personally assure you that I can find a financier to refinance these properties and maybe earn a better interest, if I may."
Nevertheless, the vote by show of hands was conducted, and the adjournment voted down by a narrow 63 to 58.
IHC chairman Gerald Lim almost entertained a recount, which was scrapped after Mr Low shouted: "Can we just proceed with the meeting?" And half the room took up a chant: "Proceed! Proceed!"
Eight of the nine resolutions - to remove the board and appoint Mr Roger Tan, Mr Eric Sho and Mr Jackson Tay as new directors, passed with ease.
The only resolution not passed was the appointment of Baker Tilly as company auditor, which had been put forth by the ousted board.
The market was closed by the time the votes had been counted. The counter fell 0.1 cent or 1.47 per cent to close at 6.7 cents on Monday.
In a final twist, OUE said Monday night that it had, over the course of the day, acquired a 12.54 per cent stake in IHC for 7.7 cents a share.
Investors will be keen to see if Mr Fan Kow Hin, who had a 23.4 per cent stake in IHC as of last January, reports a change in shareholding over the next few days.
In addition to the $50 million bonds maturing in April, IHC has $50 million due next year.
The bonds have a condition that bond holders can redeem their money if the total shareholding of Mr Fan, Mr Jong, substantial shareholder Aathar Ah Kong Andrew, and their immediate family members falls below 30 per cent.
