Change - Announcement of Cessation::CESSATION OF EXECUTIVE DIRECTOR

Issuer & Securities

Issuer/ Manager
RICH CAPITAL HOLDINGS LIMITED
Securities
RICH CAPITAL HOLDINGS LIMITED - SG2G63000001 - 5G4
Stapled Security
No

Announcement Details

Announcement Title
Change - Announcement of Cessation
Date &Time of Broadcast
05-Jul-2019 17:47:39
Status
New
Announcement Sub Title
CESSATION OF EXECUTIVE DIRECTOR
Announcement Reference
SG190705OTHR357O
Submitted By (Co./ Ind. Name)
JAMES KHO CHUNG WAH
Designation
INDEPENDENT NON-EXECUTIVE DIRECTOR
Description (Please provide a detailed description of the event in the box below)
This announcement has been prepared by the Company and its contents have been reviewed by the Company's sponsor, PrimePartners Corporate Finance Pte. Ltd. (the "Sponsor") in accordance with Rules 226(2)(b) and 753(2) of the Singapore Exchange Securities Trading Limited (the "SGX-ST") Listing Manual Section B: Rules of Catalist.

This announcement has not been examined or approved by the SGX-ST. The SGX-ST assume no responsibility for the contents of this announcement, including the correctness of any of the statements or opinions made or reports contained in this announcement.

The contact person for the Sponsor is Mr Joseph Au, Associate Director, Continuing Sponsorship (Mailing Address: 16 Collyer Quay, #10-00 Income at Raffles, Singapore 049318 and E-mail: sponsorship@ppcf.com.sg).

Additional Details

Name Of Person
Kuek Tee Meng
Age
54
Is effective date of cessation known?
Yes
If yes, please provide the date
20/06/2019
Detailed Reason (s) for cessation
Mr Kuek has decided to voluntarily resign as the Executive Director, Finance of the Group on mutually agreed terms with the Company and its board of directors ("Board"). Managerial differences with the Board are set out below.

After having interviewed Mr Kuek and to the best of its knowledge, the Company's Sponsor, PrimePartners Corporate Finance Pte. Ltd., is satisfied that save as disclosed in this announcement, there are no other material reasons for the cessation of Mr Kuek as the Executive Director, Finance of the Group. In addition, there are no concerns with regards to financial reporting, save for the Advance Payment as described below, that led to the cessation of Mr Kuek, and there are no disagreements between Mr Kuek and the Company's Board of Directors with regards to practices that will have an impact on the Company's financial reporting. It is noted that Mr Kuek's cessation will be with no notice period and the Company has agreed to pay a lump sum in salary up to 31 December 2019 inclusive of CPF contributions to Mr Kuek as stipulated in this resignation letter to the Company dated 20 June 2019.

During this interim period, the Financial Controller of the Company will assume Mr Kuek's roles and responsibilities until a suitable replacement is found.
Are there any unresolved differences in opinion on material matters between the person and the board of directors, including matters which would have a material impact on the group or its financial reporting?
Yes
If Yes, Please provide full details
Mr Kuek is of the opinion that there are unresolved differences between himself and the Board in relation to the following:

(1) His recommendation to initiate prompt recovery of the S$2.0 million Advance Payment ("Advance Payment") paid out by the Company on behalf of PT OKIB to Rich-Link Construction Pte. Ltd. ("RLC"); and

(2) The proposed termination of RLC ("Proposed Termination") as the main construction contractor in view of the extended delay in the non-provision of the Advance Payment Guarantee and Performance Bond, which are deemed breaches of the terms of the construction contract awarded to RLC.
Is there any matter in relation to the cessation that needs to be brought to the attention of the shareholders of the listed issuer?
Yes
If Yes, Please provide full details
The Board disagrees with Mr Kuek's response above (on there being unresolved differences) and set out its reasons below:

(1) Advance Payment:
RLC provided the Company with an undertaking to provide the Payment Guarantee on 30 May 2019. On 31 May 2019, Mr Kuek sent an email to the independent directors asking for permission to call back the $2mil from RLC as soon as possible, within 7 days from the date of the email. The AC did not disagree with his suggestion and suggested Mr Kuek to get a revised letter of undertaking from RLC. However, the AC did not hear from Mr. Kuek on this matter subsequently. The AC had explained to Mr. Kuek earlier in verbal conversation that, given that RLC had just provided the Company with their undertaking, the AC believed that, at that point of time, it would be beneficial for the Company to provide RLC with a 2 weeks period to remedy the outstanding condition and continuing with their work. The AC had also hoped for the matter to be settled amicably and believed that it would be premature to commence legal proceeding against RLC then given the undertaking provided. The AC also took note that the wrongful payment was a result of a breach of governance process of the Company's own management.

(2) Proposed Termination:
Following Mr Kuek's suggestion of the Proposed Termination, the Board requested him to provide the Board with the basis for his recommendation and analysis supporting that the Proposed Termination would be in the best interest of the Company - Mr Kuek never provided the Board with the same.

The Board later discovered, after his resignation, that the Project Manager had (in response to Mr Kuek's queries) advised that the Proposed Termination would not be in the best interest of the Company and may result in serious adverse legal and financial implications ("Proposed Termination Implications"). Mr Kuek omitted and failed to inform the Board of the Proposed Termination Implications.

(3) On the date of Mr Kuek's resignation, he had confirmed in writing to the IDs of the Board that he "has no unresolved differences in opinion with the Board of Directors".
Any other relevant information to be provided to shareholders of the listed issuer?
No
Date of Appointment to current position
03/01/2019
Does the AC have a minimum of 3 members (taking into account this cessation)?
Yes
Number of Independent Directors currently resident in Singapore (taking into account this cessation)
2
Number of cessations of appointments specified in Listing Rule 704 (7) or Catalist Rule 704 (6) over the past 12 months
4
Job Title (e.g. Lead ID, AC Chairman, AC Member etc.)
Executive Director, Finance
Role and responsibilities
Accounting and finance functions of the Group.
Familial relationship with any director and/ or substantial shareholder of the listed issuer or of any of its principal subsidiaries
Nil
Shareholding interest in the listed issuer and its subsidiaries?
No
Past (for the last 5 years)
Directorships:
Oxley Batam Pte. Ltd.
PT Oxley Karya Indo Batam
New Toyo Lamination (M) Pte Ltd
Alliance Innovation Solutions Pte Ltd
Neumind International Pte Ltd

Principal Commitments:
New Toyo International Holding Limited
JEP Holdings Ltd
Present
Nil