The entire board of International Healthway Corp (IHC) was voted out yesterday after clashing with shareholders at a lengthy and at times chaotic meeting, which was 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 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 adjournment suggestion 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 a 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. Although all resolutions at general meetings held by firms listed here must be voted by poll, the adjournment of a meeting is not considered a resolution.
This point was debated for a long time, with Oxley deputy chief Eric Low the most vocal. 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."
Still, the vote by a show of hands was conducted, and the adjournment voted down narrowly 63 to 58.
IHC chairman Gerald Lim almost entertained a recount, which was scrapped after Mr Low said: "Can we just proceed with the meeting?" And half the room took up a chant: "Proceed! Proceed!"
The resolutions to remove the board and appoint new directors were passed with comfortable margins. The only resolution not passed was the appointment of Baker Tilly as company auditor.
In a surprise development, OUE said last 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. The speculation is that the seller could be co-founder Fan Kow Hin, who had a 23.4 per cent stake as of January last year.