No Signboard says final settlement offer not accepted by GuGong, aims to reach agreement on June 26

SINGAPORE – Restaurant operator No Signboard Holdings is working towards the resolution of

a dispute with its controlling shareholder GuGong and chief executive Lim Yong Sim

by Monday. This comes after the group on Friday warned that a “final settlement offer” had not been accepted by the deadline.

GuGong is an entity controlled by Mr Lim, who is also a joint signatory of certain No Signboard operational bank accounts.

The settlement offer includes reinstating an intellectual property (IP) sales and purchase agreement, along with an independent contractor agreement, that all parties had initially agreed upon.

Alternatively, the Catalist-listed company proposed that GuGong pay the company $300,000 for the purchase of the IP. No Signboard would, in turn, pay $365,000 in full and final settlement of ongoing legal proceedings.

The final settlement offer closed unaccepted on June 21, although GuGong had requested some clarifications.

No Signboard also noted that previous attempts to reach out to Mr Lim with a view to an amicable settlement were unsuccessful.

The company said it would continue to engage GuGong and its lawyer to reach an in-principle agreement by June 26.

This timeframe is in consideration of the company’s “serious financial challenges” including the potential withdrawal of support from its investor, Gazelle Ventures.

Shares of No Signboard have been suspended from trading since Jan 24, 2022.

The IP sales and purchase agreement and independent contractor agreement were terminated in March 2023. GuGong subsequently alleged that the company’s “unilateral termination” was “unlawful and in breach of the agreements”, and demanded a retraction of the notice of termination.

No Signboard said a resumption of trading would benefit the company and its stakeholders as it could allow the payment of cash distribution to creditors and allow the board to move forward with plans to improve the company’s cash flow position.

The board also said that No Signboard’s existing streamlined business was critical for it to have a “viable business in order to resume trading”.

The company currently operates two food and beverage outlets in Singapore – Little Sheep Hotpot at Orchard Gateway and nosignboard Sheng Jian at Northpoint City.

All other F&B outlets formerly operated by No Signboard have been closed as the group liquidates its various loss-making and non-core subsidiaries.

The company said ongoing disputes had hampered its progress in resolving all outstanding issues regarding the implementation agreement for Gazelle Venture’s investment. This included disrupting the group’s operations and causing concerns with its employees and suppliers.

No Signboard’s plans of acquisition and opening new outlets were also put on hold amid the ongoing disputes.

Separately, the group on June 22 served a statutory demand on Matter Road No Signboard Seafood Restaurant for $103,440. This represented outstanding franchise fees due to the company.

THE BUSINESS TIMES