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KUALA LUMPUR: Both SC Estate Builder Bhd (SCBuild) and 10 individual current directors have been warned of the consequences of a breach of Clause 127 of its Constitution, as well as that of Section 340(1)(d) of the Companies Act for rejecting new board nomination.
Nominated candidate Tan Sri Lee Kim Tiong @ Lee Kim Yew claimed that such act could attract criminal liability, and if convicted, they could be fined up to RM20,000 each.
In a statement on Tuesday, Lee, who is a nominated candidate at the company’s forthcoming 17th Annual General Meeting (AGM) slated for Dec 31, said the 10 current SCBuild directors had unlawfully rejected the nomination by two members of SCBuild for eight persons to stand as candidates for election to the office of director of SCBuild at the upcoming AGM.
It said the constitution of SCBuild makes accommodation for the election of directors at the AGM.
"Under Clause 127 of the Constitution (Clause 127), any one member of SCBuild may propose a person to be a candidate for election to the office of director of SCBuild at the AGM.
"In this case, two members, namely Valuevest Ventures Sdn Bhd (a member holding 23.089 million shares in SCBuild) and Datuk Eric Tan Chwee Kuang (a member holding 27 million shares in SCBuild), made written nominations on Dec 17 for a total of eight such candidates for election to the office of director,” it said.
The eight candidates include Lee, who is also Country Heights Holdings Bhd executive chairman and Tan, it added.
On Dec 21, the current directors emailed each of the eight candidates foisting on them five queries relating to their "relationship” with the nominator members, knowledge and description of such alleged "relationship”, knowledge of other candidates, events in detail leading to their nomination and why they consented, as well as how he/she is above to exercise "independent” judgment and act in the best interest of SCBuild.
"The current directors also demanded that each of the nominator members ‘furnishes proof’ of its/his shareholdings in SCBuild,” it said.
It said on the same day, Dec 21, law firm Yoong & Partners replied on behalf of the nominator members.
"Simply put, the nominator members had nominated the candidates to be ‘directors’ and not as ‘independent directors’, as the current directors tried to paint it to be.
"As such, the five queries foisted on the eight candidates were irrelevant,” it said.
Commenting on this, Lee said what was clear from the remarks was firstly, the current directors were acting unlawfully in an attempt to block the candidature of the eight nominees put forward by the two nominator members on the wrong or mistaken premise, that the nominations were for "independent directors” and the candidates were not so "qualified”.