Indeed! After being rejected by the board of directors and the board of supervisors of Jiangsu Xinning Modern Logistics Co.Ltd(300013) (300013, SZ), Zeng Zhuo, the first largest shareholder of Jiangsu Xinning Modern Logistics Co.Ltd(300013) , and Henan Zhongyuan Financial Holding Co., Ltd. (hereinafter referred to as Zhongyuan financial holding) decided to convene the first extraordinary general meeting of shareholders in 2022.
Zeng Zhuo and Zhongyuan financial holding held 8.13% and 7.43% of the shares of Jiangsu Xinning Modern Logistics Co.Ltd(300013) respectively, with a total proportion of 15.56% of the shares of listed companies. According to the announcement on February 11 of Jiangsu Xinning Modern Logistics Co.Ltd(300013) , Zhongyuan financial holding issued a notice to Jiangsu Xinning Modern Logistics Co.Ltd(300013) and decided to convene the general meeting of shareholders on its own.
On February 9, the reporter of “daily economic news” called the listed company as an investor and asked whether the listed company would have a response if Zeng Zhuo and Zhongyuan financial holding (hereinafter referred to as the convening shareholder) held a shareholders’ meeting on their own. Jiangsu Xinning Modern Logistics Co.Ltd(300013) the staff of the board secretary office said that if the other party needs to disclose when holding an extraordinary general meeting of shareholders, “they should all have ways to deal with it.”
Twice rejected
The convening shareholders sent a letter to Jiangsu Xinning Modern Logistics Co.Ltd(300013) for the first time on January 25, which mainly requested Jiangsu Xinning Modern Logistics Co.Ltd(300013) to convene an extraordinary general meeting of shareholders and vote on agreeing to elect Hu Shihan and Li Chaojie as non independent directors of Jiangsu Xinning Modern Logistics Co.Ltd(300013) the Fifth Board of directors.
Jiangsu Xinning Modern Logistics Co.Ltd(300013) said that because Zeng Zhuo used the company’s subsidiaries to provide guarantees to him in violation of regulations, suspected non operating occupation of the company’s subsidiaries’ funds and other situations that seriously damaged the interests of the company, and he has been listed as a dishonest executee, Zeng Zhuo also admitted that he had a large amount of debt, which was not paid off when due and was in a continuous state, Such circumstances are not allowed to acquire listed companies.
According to Article 60 of the measures for the administration of the acquisition of listed companies, if the actual controller is not allowed to acquire a listed company, the board of directors of a listed company shall refuse to accept the proposal or interim proposal submitted to the board of directors by the shareholders dominated by the actual controller, and report to the CSRC, its dispatched offices and the stock exchange.
In addition, after the Jiangsu Xinning Modern Logistics Co.Ltd(300013) board of Directors voted, more than half of the directors refused to accept the letter calling shareholders and the proposals and proposals mentioned therein. Therefore, the relevant request of the letter was finally rejected by the listed company.
After being rejected, on February 4, the shareholders were called to seek a breakthrough from the Jiangsu Xinning Modern Logistics Co.Ltd(300013) board of supervisors, and Zhongyuan financial holding sent a letter to Jiangsu Xinning Modern Logistics Co.Ltd(300013) again for the same purpose as before. The convening shareholders believe that Zeng Zhuo has no intention to acquire the listed company, and promise and guarantee that he will not make any behavior or plan to increase the shares of the listed company or seek the control of the listed company in the next 12 months.
At the same time, the convening of shareholders showed that the proposal is a legal right to improve the corporate governance structure and protect the interests of listed companies and all shareholders, and the two director candidates are nominated by Zhongyuan financial holding, which has nothing to do with Zeng Zhuo. The above proposal does not constitute Zhongyuan financial holding’s behavior of seeking control of listed companies. The reason is that even if the two directors nominated by Zhongyuan financial holding are elected, Zhongyuan financial holding still has not more than half of the seats on the board of directors. However, the board of supervisors also rejected the request to convene shareholders.
If you want to convene a shareholders’ meeting on your own
Therefore, after being rejected twice by listed companies, Zhongyuan financial holding directly sent a notice to Jiangsu Xinning Modern Logistics Co.Ltd(300013) on the evening of February 11 and decided to convene an extraordinary general meeting of shareholders on its own.
Jiangsu Xinning Modern Logistics Co.Ltd(300013) said that after receiving the notice, the company attached great importance to it and hired a law firm to issue a legal opinion. In combination with the reply of the board of directors and the board of supervisors and the legal opinion, the preconditions for convening the shareholders to convene the extraordinary general meeting of shareholders by themselves are not met.
According to the legal opinion, according to the written reply of the Jiangsu Xinning Modern Logistics Co.Ltd(300013) board of directors to the convening shareholders, the board of directors refused to accept the letter on requesting the convening of Jiangsu Xinning Modern Logistics Co.Ltd(300013) extraordinary general meeting of shareholders and the proposals and proposals mentioned in the letter in accordance with Article 60 of the measures for the administration of the acquisition of listed companies, That is, the relevant procedures for shareholders’ request for convening the general meeting of shareholders specified in Article 48 of the articles of association shall not be started. Article 60 of the measures for the administration of the acquisition of listed companies stipulates: “if the actual controller is not allowed to acquire the listed company, the board of directors of the listed company shall refuse to accept the proposal or interim proposal submitted to the board of directors by the shareholders dominated by the actual controller.”
Lawyer Fang believes that the legal effect of “Refusal” mentioned in Article 60 of the measures for the administration of the acquisition of listed companies is that the board of directors refuses to submit the letter convening shareholders and the proposals and proposals mentioned in the letter to the board of directors for deliberation, The board of directors’ approval or disapproval of the shareholders’ request for convening the general meeting of shareholders is the result of the board of directors’ consideration of the shareholders’ request, that is, the relevant procedures for shareholders’ request for convening the general meeting of shareholders specified in Article 48 of the articles of association have not been started from the beginning.
Therefore, Jiangsu Xinning Modern Logistics Co.Ltd(300013) the board of directors refused to accept the letter of the board of directors and the proposals and proposals mentioned in the letter in accordance with Article 60 of the measures for the administration of the acquisition of listed companies, and refused to start the relevant procedures for shareholders’ request for convening the general meeting of shareholders specified in Article 48 of the articles of association, which does not belong to the “situation where the board of directors does not agree to convene the extraordinary general meeting of shareholders”.
The shareholders’ meeting held by themselves needs to meet two preconditions. Jiangsu Xinning Modern Logistics Co.Ltd(300013) the board of directors actively performed its duties and made a written reply according to law. There is no case that the board of directors did not give feedback or did not agree to convene the general meeting of shareholders within 10 days after receiving the request. Therefore, the first prerequisite for convening the shareholders to convene the extraordinary general meeting of shareholders by themselves is not met. Secondly, Jiangsu Xinning Modern Logistics Co.Ltd(300013) the board of supervisors has also actively performed its duties and made a written reply, so the second prerequisite is not met.
In addition, the reporter of “daily economic news” noted that the shareholders were summoned to submit two application disclosure documents to the Jiangsu Xinning Modern Logistics Co.Ltd(300013) board of directors, requiring the board of directors of listed companies to timely fulfill the filing procedures to Jiangsu securities regulatory bureau and Shenzhen Stock Exchange after receiving these documents, and upload these documents for information disclosure before February 10. The two application disclosure documents are the two annexes of the notice, but Jiangsu Xinning Modern Logistics Co.Ltd(300013) did not disclose the specific contents.
So is there a legal basis for listed companies to repeatedly refuse the request to convene shareholders? Has the legitimate rights and interests of shareholders been protected?
In this regard, Lawyer Wang Zhibin of Shanghai Minglun law firm said that the joint proposal of the two shareholders to convene the general meeting of shareholders and jointly nominate directors should be regarded as the joint action of the two shareholders on a single matter, which is not equivalent to that the two shareholders have formed a concerted action. Moreover, the two shareholders did not propose the removal of the current directors. If the candidates nominated by the two shareholders are elected as directors, the company will have nine directors, including four nominated by Zhongyuan financial holding, which is not more than half. It is also difficult to define that the two shareholders jointly realized the acquisition of the listed company.
In addition, Wang Zhibin believes that Article 60 of the measures for the administration of the acquisition of listed companies gives the board of directors the right to reject shareholders’ proposals on the premise that the shareholder is controlled by the actual controller and the actual controller is in violation of regulations or is not allowed to acquire the listed company, Jiangsu Xinning Modern Logistics Co.Ltd(300013) two shareholders are not controlled by the actual controller of the company, The board of directors of the company cited this clause to reject the shareholders’ proposal, which is not in line with the original intention of the legislation.
“I personally believe that the two shareholders have the right to convene the general meeting of shareholders on their own after properly performing the pre procedure. The company’s management refuses to convene the general meeting of shareholders, which is suspected of infringing on the legitimate rights of shareholders.” Wang Zhibin said.