Change - Announcement Of Resignation Of Independent Director

BackMay 16, 2024
Announcement Title Change - Announcement of Cessation
Date & Time of Broadcast May 16, 2024 18:01
Status New
Announcement Sub Title Resignation of Independent Director
Announcement Reference SG240516OTHRCM37
Submitted By (Co./ Ind. Name) Ng Mun Fai
Designation Chief Financial Officer
Description (Please provide a detailed description of the event in the box below) Resignation of Non-Executive and Independent Director
Additional Details
Name Of Person Cao Yong
Age 69
Is effective date of cessation known? Yes
If yes, please provide the date 24/04/2024
Detailed Reason (s) for cessation Dr Cao Yong has indicated that he has resigned because, due to the following, it was clear to him that no useful purpose would be served by his continuing as a director:
(1) His requests, suggestions and feedback have been consistently ignored since early 2023;
(2) The Board of Directors (the "Board") of Dasin Retail Trust Management Pte. Ltd. (the "Company" and, together with its subsidiaries, the "Group") has not held any meeting since August 2023, the Audit and Risk Committee of the Company (the "ARC") has not held any meeting since June 2023, and the Nominating and Remuneration Committee of the Company (the "NRC") has not held any meeting since January 2023. As such, his views and opinions could not be expressed in any formal meeting for open discussions for a substantial long period;
(3) Although he kept warning the Board to not engage in wrongful trading, the Company had still incurred debts that it has no reasonable prospect of repaying; and
(4) He had not received any director fee since August 2022 without being given any reason.

Dr Kong Wei Peng, Mr Lyu Guoliang, Mr Tan Huay Lim and Mr Sonny Tan Hock Sun (together, the "Majority Directors") have indicated that they are of the view that:
(1) They have not ignored Dr Cao Yong although they note that Dr Cao Yong has frequently disagreed with the view of the Majority Directors and, in certain cases, even the advice of the Company's professional advisers;
(2) Although formal board and committee meetings had not been held, the Board had communicated by way of emails very frequently since 2023 to deal with the various matters involving the Company. Furthermore, the unaudited quarterly interim financial statements were not finalised and released pending the preparation of certain documents and information for the purposes of the Board's assessment and discussion of the unaudited quarterly interim financial statements. Generally, the Board would have access to, and would be provided with, the following documents and information:
(i) Monthly reports of the financial performance of the various China subsidiaries;
(ii) The trustee company's Singapore finance team will consolidate the information from the monthly report to produce a draft quarterly report which will be provided to the Board;
(iii) A quarterly ageing analysis and loss allowance of trade receivables (third-party and related-party-party debtors); and
(iv) A quarterly report from the Group's internal auditor based in China setting out the fees payable and expenses incurred by the commercial manager and the property manager which are related parties of the sponsor of Dasin Retail Trust, Zhongshan Dasin Real Estate Co., Ltd.

Management had only prepared and provided draft quarterly accounts to the Board up to June 2023. Since then, no draft quarterly accounts have been provided to the Board.

Since the third quarter of 2023, the China management team has stopped providing the relevant documents and reports required by the Board for purposes of the preparation of the financial statements for FY2023, for example, (i) cash and bank balances, (ii) bank statements, (iii) cash flow, (iv) rent-rolls, (v) recovery plan and actions for long overdue rent-in-arrears from related party and third-party tenants, as well as master leases. In addition, the China-based group internal auditors have ceased providing quarterly internal audit reports required for 1Q2023, 1H2023, 3Q2023 and FY2023 on related party transactions, namely, the fees and reimbursement of expenses to the commercial manager and property manager of some of the Group's retail malls. Without these reports and documents, the Board is unable to satisfy itself as to the reliability and accuracy of the financial reports prepared by the management team, as well as the recorded related party transactions.

These were matters that has occurred under the watch of the previous CEO of the Company, Ms Wang Qiu. The Board together with the new acting CEO, Mr Wang Peng, is working towards obtaining the relevant information;

(3) The Company is not engaging in wrongful trading; and
(4) Pursuant to the provisions of the Companies Act, the Company cannot pay Dr Cao Yong director fees unless there is shareholder approval to do so and this has been communicated to Dr Cao Yong.

Mr Zhang Zhencheng (together with his alternate director, Mr Zhang Zhongming) have indicated that they disagreed with the view of the Majority Directors in this announcement. Further, as announced by the Company on 3 May 2024, letters have been issued on behalf of Mr Zhang Zhencheng to Dr Kong Wei Peng, Mr Lyu Guoliang and Mr Sonny Tan Hock Sun with respect to alleged misconduct of the affairs of the Company.

The Board has been informed by Dr Kong Wei Peng, Mr Sonny Tan Hock Sun and Mr Lyu Guoliang that they have responded to the aforesaid letters through their lawyers denying all the allegations stated in the letters.
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 Please see detailed reason(s) for cessation above. In addition, Dr Cao Yong has indicated that he reserved all his rights with respect to unpaid director fees.
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 Please see disclosure above.
Any other relevant information to be provided to shareholders of the listed issuer? No
Date of Appointment to current position 23/12/2016
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 3
Job Title (e.g. Lead ID, AC Chairman, AC Member etc.) Independent Director
Role and responsibilities Independent Director, member of the ARC and member of the NRC
Familial relationship with any director and/ or substantial shareholder of the listed issuer or of any of its principal subsidiaries None
Shareholding interest in the listed issuer and its subsidiaries? No
Past (for the last 5 years) Chinese Global Investors Group Ltd
Present Nil