The battle for control of Xinchao Energy Continues Chairman Liu Ke was #时报大视野 by "his own people" against the water #

Securities Times reporter Tang Qiang

In recent times, the battle for control of 600777 has continued to stage new dramas. The two sides were: Ningxia Shunyi, Jin Zhi changsheng, Dongying Huiguang, Hangzhou Hongyu and other 9 Xinchao Energy shareholders formed a coalition, and Xinchao Energy Chairman Liu Ke controlled by the board of directors.

After various reports, temporary replacement of venues and other unexpected situations, on August 10, the Xinchao Energy 9 Shareholders Alliance finally held a press conference smoothly, revealing the latest situation of the control struggle for the listed company.

The Securities Times E Company reporter learned from the scene that the two sides of the disagreement had held a hearing on August 9, and the "own people" who were originally classified as Liu Ke's side by the outside world showed signs of anti-water, and Shenzhen Rongtong Capital Management Co., Ltd. (hereinafter referred to as "Shenzhen Rongtong") may not fully support its decision-making. Today, the battle for control of the new wave energy is still continuing, and the Securities Times reporter will continue to follow the report.

He is currently the Board of Directors and the Board of Supervisors

Proposals for re-election were rejected one after another

Since 2021, the "infighting" between the shareholders of Xinchao Energy has been completely open, clarified and expanded, and the game between the two sides has become more and more intense.

Back on April 26, the board of directors of Xinchao Energy received a proposal from 9 shareholders, including Ningxia Shunyi and Jin Zhichangsheng, requesting the removal of the company's existing directors Liu Ke, Fan Xiaochuan and Cheng Ruimin, independent directors Zhang Xiaofeng and Du Jing and existing supervisor Liu Siyuan.

The reasons for the recall given by the above-mentioned shareholders are: after due diligence, the management and operation capabilities of the current board of directors of Xinchao Energy, represented by Chairman Liu Ke, are insufficient, cannot reasonably respond to emergencies such as falling oil prices, have serious defects in the governance of listed companies, have prominent insider control problems, and shareholders cannot protect their rights and interests through legal channels. The failure of the directors and supervisors of listed companies to fulfill their duties of loyalty and diligence has led to a sharp decline in the company's net profit, market value and stock price, which has damaged the legitimate interests of listed companies and other shareholders.

According to the regular financial report, in 2019, the revenue and net profit of Xinchao Energy were 6.07 billion yuan and 1.078 billion yuan respectively; by 2020, The revenue of Xinchao Energy was reduced to 4.144 billion yuan, and the net profit loss reached 2.656 billion yuan; in the first quarter of 2021, the company's revenue was 1.212 billion yuan (down 23.27% year-on-year) and the net profit was 253 million yuan (down 66.2% year-on-year).

In response to the above accusations, Xinchao Energy issued an announcement on the evening of May 5, and the current 9 directors of the board of directors of the listed company completely did not recognize it, and collectively voted against it, rejecting the above proposal.

The board of directors of Xinchao Energy also gave its reasons for veto: the relevant reasons for dismissal do not conform to the provisions of the Company Law and the Articles of Association of the Company, do not have legality and lack factual basis, cannot become a valid shareholders' meeting proposal, should not convene an extraordinary shareholders' meeting for this purpose, and should not submit illegal and invalid proposals to the shareholders' general meeting for consideration and voting.

On May 6, after the proposal to convene an extraordinary general meeting of shareholders was rejected, Ningxia Shunyi and other shareholders wanted to find another way, planning to add a provisional proposal on the removal of directors and supervisors to the annual shareholders' meeting held on May 20, and to nominate relevant directors and supervisors to the listed company.

In the face of the new proposal, the current board of directors of Xinchao Energy has relaxed, and at the board meeting held on May 7, director Dai Zidi voted in favor. According to the data, Dai Zidi once served as a supervisor of Shanghai Hongde Investment Management Co., Ltd., a senior investment manager of New Liyi Group Co., Ltd., a supervisor of Guohua Life Insurance Co., Ltd., and is currently a partner of Ningbo Jusheng Xinneng Enterprise Management Consulting Partnership (Limited Partnership), an executive director of Shanghai Zhiyu Culture Media Co., Ltd., and the general manager of Shanghai Zhiyu Culture Media Co., Ltd.

If you can't do it, find a new trick. On May 10, 9 shareholders, including Ningxia Shunyi, Jin Zhi changsheng, Dongying Huiguang and Hangzhou Hongyu, turned to the board of supervisors to "appeal" and submitted written materials to request the board of supervisors of Xinchao Energy to convene the first extraordinary shareholders' meeting in 2021. As the chairman of the Supervisory Board of Xinchao Energy, Liu Siyuan was also a supervisor who was dismissed by nine shareholders, and in the end, at the interim supervisory board meeting of Xinchao Energy chaired by Liu Siyuan on May 14, the three supervisors joined forces to oppose and rejected the relevant proposals.

Nine shareholders held the meeting on their own

The shareholders' meeting passed the recall motion

After being rejected by the board of directors of Xinchao Energy, 9 shareholders, including Ningxia Shunyi and Jin Zhichangsheng, decided to "go it alone" - to hold an extraordinary shareholders' meeting on their own.

On May 27, Xinchao Energy announced that it had received the "Notice Letter on the Voluntary Convocation of the First Extraordinary General Meeting of Shareholders of Shandong Xinchao Energy Co., Ltd. by Ningxia Shunyi Energy Technology Co., Ltd. and Other Shareholders" and other materials; on June 8, it received the "Notice Letter" and related materials from nine shareholders to convene the Extraordinary General Meeting of Shareholders.

In this regard, Xinchao Energy believes that the relevant notice does not meet the requirements of the statutory information disclosure method, and the relevant joint shareholders do not meet the statutory conditions for self-convening the shareholders' meeting, their notification behavior is not legal, and the media notice of the self-convening of the shareholders' meeting is invalid.

After several twists and turns, the nine shareholders' alliance still held an extraordinary shareholders' meeting on its own on July 8, and deliberated and passed the motion to remove 6 directors including Liu Ke, Fan Xiaochuan, Cheng Ruimin, and 2 supervisors including Liu Siyuan and Lu Xu, and elect 6 directors including Wang Jinzhou, Pan Hui, and Wang Zhaoguo, as well as 2 supervisors such as Wu Yulong and Shao Kan.

Fu Bin, executive vice president of the "new management team", told the Securities Times e Company reporter that more than 220 shareholders and proxies attended the shareholders' meeting, and the total number of shares held by Xinchao Energy exceeded 1.83 billion shares, accounting for 27% of the total share capital of the listed company. The Shanghai Stock Exchange provided an Internet voting platform for the shareholders' meeting, and the China Securities Depository and Clearing Center provided a register of shareholders of Xinchao Energy, and a total of 16 proposals were passed at the meeting.

There is no compromise between them

The "double-headed" board of directors has been formed

Each set up a ring, each singing each play.

Although the self-convened extraordinary shareholders' meeting has been held, the 9 shareholders are like lone performers, and since they do not believe that this extraordinary shareholders' meeting meets the statutory conditions, the current board of directors of Xinchao Energy will naturally not publish its voting proposal.

In fact, the board of directors of Xinchao Energy does not implement the resolutions of the above-mentioned extraordinary shareholders' meeting, and the "double-headed" board of directors is substantially formed.

On July 8, the Shanghai Stock Exchange issued a regulatory work letter to Xinchao Energy and put forward regulatory requirements for Xinchao Energy and related shareholders.

On July 9, the Shandong Securities Regulatory Bureau also issued a regulatory opinion letter, requiring Xinchao Energy and relevant shareholders to effectively maintain the operational stability of the listed company, and neither party shall infringe on the interests of the listed company in any way, shall not harm the public interest and the legitimate rights and interests of small and medium-sized shareholders, and any infringement of the company's interests will be investigated by law. All parties to Xinchao Energy should resolve existing problems under the framework of laws and regulations and corporate governance, support the company and its shareholders in exercising their rights in accordance with the law, safeguard their legitimate rights and interests through legal means such as civil litigation, and resolve disputes over civil rights such as shareholder rights.

On the eve of the shareholders' own extraordinary general meeting of shareholders, on the evening of July 7, Xinchao Energy announced that it will hold an extraordinary general meeting of shareholders in Beijing on July 23, 2021 to consider the proposal to exempt shareholders from commitments.

According to an informed source to the Securities Times E Company reporter, on July 21, the new wave energy directors, supervisors and gao elected by the extraordinary shareholders' meeting entered the Beijing office of the listed company, and required the dismissed directors, supervisors and senior personnel to perform the resolutions of the shareholders' meeting and hand over official seals, licenses and other documents to the "new" management. However, the existing management of Xinchao Energy did not approve of it, and directly rejected the request of the other party, and both sides reported to the police.

According to the announcement, the office address left by Xinchao Energy is 10th Floor, Block A, Gemdale Center Building, No. 91 Jianguo Road, Chaoyang District, Beijing, and the reporter of Securities Times E Company learned at the front desk of Gemdale Center Property that Beijing Moxin International Energy Investment Co., Ltd., a wholly-owned subsidiary of Xinchao Energy, has sent a letter to it to request that the property will not apply for a pass card for all outsiders who visit the 10th and 35th floors of the company, and will send designated personnel to pick them up.

After several twists and turns, the securities times and e company reporters arrived at the 10th floor where Xinchao Energy was located, but the situation presented was that "people went to the building and were not empty", and there were only 3 to 4 security guards at the door.

The largest partner of CICC Tonghe expressed his position

The game continues! On August 5, Xinchao Energy disclosed that the litigation announcement, Beijing Zhongjin Tonghe Venture Capital Center (Limited Partnership) (hereinafter referred to as CICC Tonghe) requested to revoke the resolution of the shareholders' meeting made on July 8, 2021.

CICC Tonghe believes that the convocation procedure of the above-mentioned extraordinary shareholders' meeting seriously violates the provisions of laws, administrative regulations and the articles of association of the company, its voting method seriously violates the provisions of the articles of association of the company, and the "proposal" of the above-mentioned extraordinary shareholders' meeting violates the provisions of the articles of association of the company, and the content of the resolutions of the shareholders' meeting made accordingly also violates the provisions of the articles of association of the company.

It is understood that the contradiction between the "original management" and the "new management" represented by CICC Tonghe has a long history.

However, the securities times e company reporter obtained two documents from people close to the nine shareholders, but they showed a different side of CICC.

Among them, the notification letter sent by Shenzhen Rongtong Capital Management Co., Ltd. (Shenzhen Rongtong) to the Chaoyang District People's Court of Beijing Municipality shows that Shenzhen Rongtong is a partner who holds 99.99% of the partnership share of CICC Tonghe, but is unaware of the above lawsuits and acts, which is a major matter affecting the safety pointed out by the partnership.

Therefore, Shenzhen Rongtong believes that the above-mentioned litigation and conduct preservation acts are not the true intentions of CICC Tonghe. In the notification letter, Shenzhen Rongtong clearly stated that it supported the restructuring of the board of directors and the improvement of corporate governance at the first extraordinary shareholders' meeting of Xinchao Energy in 2021 held by the relevant shareholders, and CICC Innovation should not maliciously delay the implementation of the resolutions of the shareholders' meeting for Liu Ke's personal interests. In view of the above-mentioned violations of laws and regulations, Shenzhen Rongtong reserves the remedy measures to remove CICC Innovation and recover losses.

As of the end of the first quarter of 2021, CICC Tonghe held 168 million shares of Xinchao Energy, with a shareholding ratio of 2.48%, making it the eighth largest shareholder. According to Tianyan, Liu Ke, chairman of Xinchao Energy, holds 90% of the equity of CICC Innovation, while the latter only holds a 0.01% share of CICC Tonghe, and the subscription amount is only 3,000 yuan.

In addition, State Reserve Huijin Capital Management Co., Ltd. is the main investor of Ningbo Jitong Equity Investment Partnership (shareholding ratio of 5.93%) and the sixth largest shareholder, Shanghai Dongjun Huizun Investment Management Center (shareholding ratio of 3.74%). State Reserve Huijin said that since the professional manager representatives led by Liu Ke took over Xinchao Energy in June 2018, a situation of insider control has been formed, there are serious problems in the company's operation, and Liu Ke and some management have not fulfilled their loyalty and diligence obligations as directors. As an investor, the State Reserve Huijin expressed its support for the shareholders' previous shareholders' exercise of their rights in accordance with the law to convene an extraordinary general meeting of shareholders and to reorganize the board of directors and the board of supervisors.

9 shareholders:

Has been caught in serious insider control

On August 10, the so-called "new management" elected by the Extraordinary General Meeting of Shareholders of Xinchao Energy officially held a press conference to communicate with the media on hot issues of concern to the outside world, and the elected "director" Wang Jinzhou, "independent director" Xiao Yinan, and "executive vice president of the new management team" Fu Bin attended.

At the press conference, Fu Bin revealed that after the extraordinary shareholders' meeting of Xinchao Energy on July 8, the new management team did a lot of work around the transfer of management rights, on the one hand, to report to the relevant regulatory authorities in a timely manner to obtain guidance and support, on the other hand, to perform the management responsibilities entrusted by the resolutions of the shareholders' meeting under the legal framework. Previously, the new management team planned to hold a press conference on July 23 to respond to the concerns of various sessions, but unfortunately the conference was blocked by the original management team and forced to be suspended.

Fu Bin said that optimizing the corporate governance structure is a problem worthy of long-term consideration by the new management team of Xinchao Energy, and the severe challenge facing it at present is how to break the insider control situation that seriously restricts the development of the company.

Fu Bin believes that there will occasionally be a lag in understanding information disclosure, but selective information disclosure is essentially a refusal to accept shareholder supervision and is not allowed by law. There are two main characteristics of insider control in Xinchao Energy, one is the transmission of benefits through related party transactions, and the other is to control information disclosure to avoid effective supervision of the management team by shareholders.

For the recall proposal, the focus of the debate between the nine shareholders' alliance and the current board of directors is the issue of legality.

In this regard, Fu Bin said that the removal of the original management team was forced by the initiator to take actions, mainly because Xinchao Energy has fallen into a serious insider control situation. In the working letter, the regulator clearly pointed out that the original management team should assist the shareholders in performing the information disclosure business in accordance with the law, and the original management team has not made any announcement on the information of the first extraordinary shareholders' meeting on July 8. The "new management team" calls on the members of the original management team to fulfill their statutory obligations, stop fighting, and cooperate with the handover work.

The amount of foreign investment exceeded 200 million

Flowed into Liu Ke Holding Company

As for the reasons for dismissing the original management team, Fu Bin specifically pointed out that after the court judgment, Xinchao Energy paid 600 million yuan through investment and borrowing, of which 220 million yuan entered the company where Liu Ke was a legal person, and the original management team has not yet started the recovery procedure.

According to the judgment documents disclosed by the Hami Intermediate People's Court on December 15, 2020, Xinchao Energy had invested 600 million yuan in Hami Heshengyuan Mining Co., Ltd. (Heshengyuan), of which 220 million yuan eventually flowed into CICC Innovation, which Liu Ke actually controlled. According to the data, Liu Ke and Liu Bin, chairman of Xinchao Energy, are shareholders of CICC Innovation, Liu Ke holds 90% of the shares, and Liu Bin, who was a director of Xinchao Energy, holds 10% of the shares.

The Hami Intermediate People's Court held that the legal representatives of CICC Innovation and Xinchao Energy were both Liu Ke, and there was a related relationship between the company, and Xinchao Energy did not produce evidence to prove that the money flowed into its affiliated company was a real business transaction. In summary, The behavior of Xinchao Energy is in line with the situation of withdrawal of capital contribution, and Xinchao Energy should bear corresponding civil liability according to law.

Xinchao Energy appealed that it had no right to operate and manage Heshengyuan, was unaware of the transfer of large amounts of funds, and should not bear corresponding liability. The Hami Intermediate Court rejected the appeal and upheld the original judgment.

After the Hami Intermediate People's Court made the judgment, Xinchao Energy was not satisfied with the judgment and applied to the Xinjiang Uygur Autonomous Region High People's Court for a retrial. On May 14, 2021, the Xinjiang Higher People's Court ruled that the court of first instance found that It was not improper for Xinchao Energy to withdraw capital contributions, and rejected Xinchao Energy's application for retrial.

On August 10, a reporter from Securities Times E Company called Xinchao Energy, hoping that the listed company would conduct an interview and communication on relevant hot issues and the doubts of 9 shareholders, but as of press time, Xinchao Energy executives had not yet contacted the reporter.