RNS Number:1866T
Zhejiang Southeast Elec Power Co Ld
19 March 2002
Zhejiang Southeast Electric Power Company Limited
Announcement on Resolutions of the 17th Meeting of the 2nd Board of Directors
The 17th meeting of the 2nd Board of Directors (the "Meeting") of Zhejiang
Southeast Electric Power Company Limited ("ZSEPC") was held at Wanghu Hotel,
Hangzhou, the PRC on 14 March 2002. Thirteen directors should be present and 13
directors (and representative) were present at the Meeting (Director Mr. Zhao
Yuanjie was absent due to other work and has appointed Mr Zhu Li to attend the
Meeting), complying with the stipulations set out in Company Law of the PRC and
Articles of Association. All of the supervisors attended the Meeting as
observers. The following resolutions were adopted at the Meeting:
1. Approve and adopt the Report of the Board of Directors of the Company for
2001.
2. Approve and adopt the Report of the general manager of the Company for 2001.
3. Approve and adopt the Financial Report of the Company for 2001.
4. Approve and adopt the Proposal for Distribution of Profits of the Company for
2001 and the Proposal for Profits Distribution Policy for 2002.
The consolidated profit after tax of the Company for 2001 amounts to
RMB734,057,844.37 yuan (RMB734,057,844.37 yuan according to International
Accounting Standards). Net profits of the parent company are
RMB734,098,469.37 yuan (RMB734,098,469.37 yuan according to International
Accounting Standards). The statutory common reserve fund and statutory
public welfare fund have been allocated on a 10% basis of the net profit of
the parent company totalling RMB 146,819,693.88 yuan and the undistributable
profits at the beginning of the year was RMB748,568,674.38 yuan
(RMB750,164,388.76 yuan according to the International Accounting
Standards). According to the policy of whichever the lower, the actual
consolidated profit for distribution to the shareholders amounts to
RMB1,335,806,824.87 yuan (RMB1,337,402,539.25 yuan according to the
International Accounting Standards), and the actual profit of the parent
company distributable to the shareholders amounts to RMB1,335,847,449.87
yuan (RMB1,337,443,164.25 yuan according to the International Accounting
Standards). On the basis of the share capital of 2,010,000,000 shares at the
end of the year, a cash dividend of RMB 0.25 yuan (tax included) per share
totalling RMB 502,500,000 yuan for 2001 will be distributed to all the
shareholders. After distribution, the remaining consolidated undistributed
profit of the Company amounts to RMB833,306,824.87 yuan (RMB834,902,539.25
yuan according to the International Accounting Standards). The undistributed
profit of the parent company amounts to RMB833,347,449.87 yuan
(RMB834,943,164.25 yuan according to the International Accounting
Standards.) The proposal has to be submitted to the 2001 Shareholders'
General Meeting for consideration.
Profit distribution for 2002 shall follow the dividend distribution policy
of the Company for previous years. The Company will adopt the policy of
distributing profits once a year, and will distribute to all shareholders a
cash dividend in the proportion of 30% to 50% of the accumulated
distributable profit of the year. At the time of implementation, the Board
of Directors shall submit the proposal on distribution to the Shareholders'
General Meeting for consideration and the Board of Directors may make
corresponding adjustments to this profit distribution policy according to
the earnings and development of the Company.
5. Approve and adopt the Annual Report and its summary for 2001.
6. Approve and adopt the Proposal on the provision for four items.
7. Approve and adopt the Financial Budget Report of the Company for 2002.
8. Approve and adopt the Proposal on establishing the independent director
system and special committees of the Board of Directors.
The Board of Directors shall have 3 independent directors and the suggested
annual allowance for an independent director will be RMB50,000 each year
(excluding tax) and the costs of business trips and lodging shall be borne
by the Company. The Board of Directors shall set up 3 special committees,
that is, the Strategy Committee, the Auditing Committee and the Examination
and Salary Committee.
9. Approve and adopt the Proposal on changes of directors and the appointment of
independent directors.
Mr. Zhao Yuanjie and Mr. Zhang Dan will no longer hold the position of
director of the Company due to work changes and retirement. Mr. Zhu Li and
Mr. Zhang Huaiyu are nominated as candidates for the post of director. Mr
Huan Guochang, Mr Gu Gongyun and Mr Huang Dongliang are nominated as
candidates for the post of independent director.
10. Approve and adopt the Proposal on amending the Articles of Association.
11. Approve and adopt the Proposal on renewing the appointment of the
Accountant. The Board of Directors agreed to renew the appointment of
Zhejiang Pan-China Public Accountants and PricewaterhouseCoopers China
Limited to provide financial statement auditing services to the Company in
2002. The amount of remuneration and method of payment will be proposed by
the management team authorized by the Board of Directors and will be
approved by the Chairman.
12. Approve and adopt the Proposal on convening the Shareholders' General
Meeting for 2001.
Board of Directors
Zhejiang Southeast Electric Power Company Limited
18 March, 2002
Appendix 1
Declaration of the nomination for independent directors of Zhejiang Southeast
Electric Power Company Limited
The nominator, Board of Directors of ZSEPC, now states openly in relation to the
nomination of Huan Guochang, Gu Gongyun and Huang Donglian_as candidates for the
post of independent director of the 2nd Board of Directors of ZSEPC. The nominee
has no relations with ZSEPC that may affect his independency. The specific
declaration is as follows:
The nomination is made after having a thorough understanding of the occupation,
educational background, titles, detailed working experience, part-time jobs, etc
of the nominee. The nominee has agreed in writing to be a candidate for the post
of independent director of the 2nd Board of Directors of ZSEPC. The nominator is
of the view that the nominee:
1. possesses the qualification of taking up the post of director of a listed
company in accordance with the laws, administrative regulations and other
relevant stipulations;
2. complies with the requirements stipulated by the Articles of Association of
ZSEPC;
3. possesses the required independency set out in the Directive Opinions on
Establishing an Independent Director System in Listed Companies issued by
the China Securities Regulatory Commission ("CSRC"):
a. The nominee and his lineal relatives and main social relationships do not
hold any position in ZSEPC and its subsidiary enterprises;
b. The nominee and his lineal relatives are neither shareholders directly or
indirectly holding 1% of the issued shares of ZSEPC, nor the top 10
shareholders of ZSEPC;
c. The nominee and his lineal relatives do not hold any position in the
companies holding more than 5% of the issued shares of ZSEPC, or in the
top 5 shareholders of ZSEPC;
d. The nominee was not under the 3 above-mentioned circumstances in the
previous year;
e. The nominee is not the personnel providing services such as financial,
legal, management consultation or technical consultation services for
ZSEPC and its subsidiary enterprises.
4. The nominee assumes concurrent positions as independent directors in not more
than 5 listed companies including ZSEPC.
The nominator warrants the authenticity, completeness and accuracy of the
above declaration, and confirm that there are no false representations or
misleading statements. The nominator fully understands the consequences of
providing false statements.
Nominator: Board of Directors of
Zhejiang Southeast Electric Power
Company Limited
18 March, 2002
Appendix 2
Declarations of the candidates for the post of independent director of Zhejiang
Southeast Electric Power Company Limited
Each of the nominees (Huan Guochang, Gu Gongyun and Huang Dongliang) has given a
declaration in the form set out below:
"The nominee as the candidate for the post of the independent director of the
2nd Board of Directors of ZSEPC, now declares openly that I have no relations
with ZSEPC that may affect my independence during my term of holding the post of
independent director of the Company. The specific declaration is as follows:
1. I, my lineal relatives and main social relationships do not hold any position
in ZSEPC and its subsidiary enterprises;
2. I and my lineal relatives do not directly or indirectly hold 1% or more of
the outstanding shares of ZSEPC;
3. I and my lineal relatives are not among the top 10 shareholders of ZSEPC;
4. I and my lineal relatives do not hold any post in companies holding 5% or
more of the issued shares of ZSEPC;
5. I and my lineal relatives do not hold any position in the top 5 shareholders
of ZSEPC;
6. I was not under the 5 above-mentioned circumstances in the previous year;
7. I have not provided services such as financial, legal, management
consultation or technical consultation services for ZSEPC or its subsidiary
enterprises;
8. I have not obtained from ZSEPC, its major shareholders or interested
institutions or personnel any additional or undisclosed interests;
9. I have met the requirements stipulated in the Articles of Association of
ZSEPC.
I concurrently hold positions as independent directors in not more than 5 listed
companies, including ZSEPC.
I completely understand the duties of an independent director, and warrant the
authenticity, completeness and accuracy of the above declaration, and confirm
that there are no false representations or misleading statements. I fully
understand the consequences of providing false statements. CSRC may confirm my
qualifications and independence by this declaration. I will abide by the
requirements of the regulations, rules and notices issued by CSRC during the
term of the independent director, ensure to have sufficient time and energy to
perform my duties and make independent judgment, and will not be affected by the
major shareholders, actual controllers or other interested units or persons.
Nominee
18 March, 2002
Appendix 3
curriculum vitae of the candidates for the post of directors (including
independent directors) and supervisors
Mr. Zhang Huaiyu, aged 38, is a master graduate, senior engineer. Mr. Zhang has
been assistant to the chief engineer, vice director of Zhejiang Electric Power
Dispatching Center. He currently holds the position of director of the Planning
Department of Zhejiang Provincial Electric Power Company. Mr. Zhang has over 19
years of technical management work experience in the electric power industry.
Mr. Zhu Li, aged 40, is a university graduate, accountant. Mr. Zhu has been
accountant, vice director and director of the Finance Department of Zhejiang
Meixi Power Plant, director and vice chief accountant of Beilun Power Plant,
vice chief accountant of Beilun Electric Power Generation Company Limited, chief
accountant of the Finance and Property Right Department of Zhejiang Provincial
Electric Power Company. He currently holds the position of deputy director of
the Finance & Property Right Department of Zhejiang Provincial Electric Power
Company.
Mr. Jiang Huadong, aged 47, is a university graduate, senior political officer.
Mr. Jiang has been technician of Zhejiang Provincial Jinyun Power Plant,
technician of Jinyun County Electric Power Company, technician, member of the
Communist Party Group and deputy director of Jinyun County Hydroelectric Power
Bureau, secretary of the Party Committee of Xinbi village, Jinyun county, member
of the Standing Committee and head of the Propaganda Department of Suichang
county, Zhejiang Province, deputy head, deputy secretary of the Party Committee,
acting head and head of Suichang county, secretary of the Party Committee of
Zhejiang Lishui Electric Power Bureau. He currently holds the position of vice
president of the Labour Union of Zhejiang Provincial Electric Power Company.
Mr Yang Jianxiong, aged 30, is a college graduate. Mr Yang has been the
secretary in charge of the Security Section, cashier, accountant, creditor and
is the deputy director of the Credit Department of the Communication Bank,
Wenzhou Branch, the deputy Director of the Industrial Operation Department of
the Headquarters of the Reconstruction of the Old City of Wenzhou. Currently he
is the deputy director of the Investment and Development Department of Zhejiang
Provincial Energy Group Company Limited.
Mr. Huan Guochang, Doctor of International Political Economics of Princeton
University of the United States, Master of Arts in International Relationship of
Columbia University of the United States, Master of Arts in International
Economics of University, of Denver, the United States. Dr. Huan possesses more
than 15 years' working experience in investment banks, and has held important
positions in Brookings Institution, U.S. Committee of the Pacific, J.P. Morgan &
Co. Incorporated, Barclays de Zoete Wedd Limited and Columbia University. Before
joining HSBC, Dr. Huan was the managing director of the Investment Banking
Department of Salomon Smith Barney. Doctor Huan was responsible for several
major mainland China transactions, including the initial public offering of
Great Wall Technology, various issues of Shanghai Industrial Corporation,
issuance of convertible bonds of Zhongyuan Group, Zhejiang Expressway Company
Limited, Air China in relation to the acquisition of Dragonair, overseas listing
of China National Aviation.
Mr. Huang Dongliang, aged 47, is an associate professor, senior accountant, PRC
certified accountant and PRC certified tax consultant. Currently he holds the
position of vice president of the Accounting Institute of Zhejiang University of
Finance and Economics, committee member of the Teaching Committee and Academic
Committee of Zhejiang University of Finance and Economics and deputy secretary
general of Zhejiang Accounting Society.
Mr. Gu Gongyun, dean and professor of the Economic Law Department of East China
Institute of Political Science and Law, is entitled to special governmental
subsidies provided by the State Council. Concurrently he is a committee member
of Shanghai Municipal Government Legislation Specialist Consulting Committee,
arbitrator of the board of arbitration of China International Economics and
Trade, vice chairman of China Science of Civil and Economic Law Research
Society, deputy general secretary in charge of Shanghai Municipal Science of
Financial Law Research Society etc. He has edited or independently published
more than 20 monographs including China Securities Law Research, Company Law,
Mergers and Acquisitions of Companies and Guide on Standardizing Operations of
joint stock companies. He has published more than 100 research papers. Mr. Gu
was conferred the title of Shanghai Municipal Outstanding Young Jurist in
January 2000.
Appendix 4
Zhejiang Southeast Electric Power Company Limited
Amendment of the Articles of Association
In order to further promote the Company to establish and improve modern
enterprise regulations, and to standardize the operation of the Company, the
original Articles of Association have been amended in accordance with the
Administration Rules of Listed Companies, Directive Opinions on Establishing an
Independent Directors System in Listed Companies and other standardizing
documents. The main contents of the amendment are as follows:
1. Amendments to certain articles of the original Articles of Association;
2. Addition of certain articles;
3. Addition of one chapter and 3 articles.
Details as follows:
1. Article 5 of the original Articles of Association will be changed to:
"Article 5 The address of the Company is: Triplenic Mansion, 528 Yanan Road,
Hangzhou, Zhejiang, P.R.C
Postal Code: 310006"
2. One item will be added to article 35 of the original Articles of Association
:
" 5) to have the right to know and participate in important matters of the
Company stipulated by laws, administrative regulations and these Articles of
Association."
3. Article 37 of the original Articles of Association will be changed to:
"Article 37 The shareholders shall have the right to protect their legal
rights through civil action or other legal means in accordance with the
stipulations of laws and administrative regulations. If resolutions passed
at the Shareholders' General Meeting or Board meetings violate the
stipulations of laws and administrative regulations, and infringe the legal
rights of shareholders, the shareholders shall have the right to initiate
proceedings to demand termination of the above unlawful or harmful acts in
accordance with the law. If the directors, supervisors and managers violate
the stipulations of laws, administrative regulations and these Articles
during the performance of their duties, thus resulting in damages to the
Company, they shall assume the compensation obligations. Shareholders shall
have the right to request the Company to initiate proceedings to demand
compensation according to law."
4. One item will be added to article 38 of the original Articles of Association
:
"4) to conscientiously carry out the decisions made by the Shareholders'
General Meeting or the Board of Directors."
5. Article 40 of the original Articles of Association will be changed to:
"Article 40 The controlling shareholders shall have the obligation to be
honest to the Company and other shareholders. Controlling shareholders shall
not by any means violate the legal rights of the listed company and other
shareholders, and shall not try to obtain additional benefits by taking
advantage of their special positions.
The controlling shareholders' nomination of the candidates for the post
directors and supervisors of the Company shall strictly comply with the
conditions and procedures stipulated in laws, regulations and these
Articles. The candidates for the post of directors and supervisors nominated
by the controlling shareholders shall possess the relevant professional
knowledge and capacity of making decisions and supervision. The controlling
shareholders shall not perform any approval formalities of resolutions on
personnel election of the Shareholders' General Meeting or personnel
engagement of the Board of Directors; shall not bypass the Shareholders'
General Meeting or the Board of Directors in relation to the appointment and
removal of senior management personnel.
Important decisions of the Company shall be made by the Shareholders'
General Meeting or the Board of Directors in accordance with the law.
Controlling shareholders shall not directly or indirectly intervene the
decisions of the Company and production and operation activities launched
according to law, and shall not damage the right and interest of the Company
and other shareholders.
The controlling shareholders should pledge to provide the relevant true,
correct and complete information to the Company, and ensure the obligations
of the Company to disclose information to the public investors according to
law.
6. Two items will be added to article 42 of the original Articles of Association
:
Article 43 The Board of Directors of the Company is authorized to exercise
the necessary right when the Shareholders' General Meeting is not in
session. The authorization by the Shareholders' General Meeting to the Board
of Directors shall comply with the following principles :
1. Complying with the principles of flexibility and dealing with concrete
matters relating to work, and with the prerequisite to maintain the
normal operation of the Company, ensuring the operational decisions made
by the Company are timely, effective and in order.
2. In accordance with the stipulations of laws, regulations, standardizing
documents and these Articles, matters that should be approved by the
Shareholders' General Meeting shall not be decided by the Board of
Directors.
3. The legal right and interest of the Company and all the shareholders
especially the medium or small shareholders shall not be damaged.
Article 44 The specific matters authorized by the Company to the Board of
Directors shall become effective after being proposed by the Board of
Directors and approved at the Shareholders' General Meeting. For the matters
not involved in the authority of the Shareholders' General Meeting, the
Board of Directors may deal with them in accordance with the relevant
stipulations, but shall report the result to the Shareholders' General
Meeting.
7. One item will be added to article 44 of the original Articles of Association:
"(6) Two or more (including 2) independent directors suggest to convene;"
8. One item will be added to the end of article 49 of the original Articles of
Association :
" The Board of Directors, independent directors and other qualified
shareholders shall have the right to collect the voting rights at the
Shareholders' General Meeting from the shareholders of the Company.
Collection of the voting rights shall be without compensation, and the
relevant information shall be fully disclosed to the person who gave up his
voting rights.
9. Article 54 of the original Articles of Association will be changed to:
" Article 56 When the Board of Supervisors or two or more (including two)
independent directors or the qualified shareholders according to item 3 of
Article 46 request to convene a Special General Meeting, the following
procedures shall be followed:
1. Sign one or several written requests of same form and same content,
submit to the Board of Directors to convene a Special General Meeting
and clarify the subject to be discussed at the meeting. The Board of
Directors shall send a notice on the Special General Meeting as soon as
possible after receiving the above-mentioned written request.
2. If the Board of Directors fails to send a notice of the meeting within 30
days after receiving the above-mentioned written requests, under the
approval of the local securities competent authority, the supervisors or
two or more (including two) independent directors or shareholders may
convene by themselves a Special General Meeting within 3 months after
the Board of Directors has received such request. The procedure of
convening should be the same to the greatest extent with that of the
Shareholders' General Meeting convened by the Board of Directors.
If the Board of Directors fails to hold the meeting as required, the Board
of Supervisors, two or more (including two) independent directors and other
shareholders convened and held a meeting by themselves, the Company shall
give the necessary assistance to the Board of Supervisors or two or more
(including two) independent directors or the shareholders and bear the costs
of the meeting."
10. Article 56 of the original Articles of Association will be changed to:
" Article 58 If the number of the Board of Directors is less than the
minimum number stipulated by the Company Law, or less than two-thirds of the
number stipulated in these Articles, or the unrecovered deficit amounts to
one-third of the total capital of the Company, and the Board of Directors
did not convene a Special General Meeting during the stipulated period, the
Board of Supervisors or two or more (including two) independent directors or
shareholders may convene a Special General Meeting in accordance with the
procedures stipulated in Article 56."
11. Article 57 of the original Articles of Association will be changed to:
" Article 59 If the Company convenes a Shareholders' General Meeting,
shareholders holding or jointly holding more than 5% of the outstanding
voting shares of the Company shall have the right to put forward new
proposals to the Company. Other stipulations in these Articles shall be
respected accordingly."
12. Article 67 of the original Articles of Association will be changed to:
" Article 69 The form and procedures for the nomination of candidates for
the post of directors and supervisors are as follows:
1. Shareholders who have the right to put forward proposals at a Shareholders'
General Meeting may nominate candidates for the post of directors of the
Company and candidates for the post of supervisors assumed by
representatives of the shareholders, the Board of Directors, the Board of
Supervisors and the shareholders holding more than 1% of the voting shares
of the Company may nominate candidates for the post of independent directors
of the Company.
2. Shareholders who have the right to nominate candidates for the post of
directors and supervisors of the Company and the shareholders, Board of
Directors and Board of Supervisors who have the right to nominate candidates
for the post of independent directors shall put forward a proposal on the
candidates for the post of directors and supervisors in writing to the Board
of Directors or Board of Supervisors 10 days before the Shareholders'
General Meeting. Besides complying with the stipulations in Articles 59 and
60 of these Articles, the following documents shall also be attached:
1. Identification paper of the nominator
2. Shareholding evidence of the nominator
3. Identification paper of the nominee
4. Curriculum vitae and basic description of the nominee.
5. Statement of the nominee without the cases stipulated in Article 83 of
these Articles.
If required, the Company may ask the nominator to submit the above-
mentioned documents to the notarial office.
After the Board of Directors or Board of Supervisors has examined the
above proposals, and considered them to be in compliance with the
stipulations of laws and these Articles, the proposals shall be
submitted to the Shareholders' General Meeting to resolve, those
proposals not included in the agenda of the Shareholders' General
Meeting shall be dealt with in accordance with the relevant stipulations
in these Articles.
1. The nomination procedure of supervisors elected by the staff of the Company
shall be carried out according to the stipulations of the relevant
democratic management of the staff of the Company.
2. The Board of Directors shall provide shareholders with the curriculum vitae
and basic description of the candidates for the post of directors and
supervisors, and shall put forward the proposal to the Shareholders' General
Meeting to resolve. Candidates for the post of directors shall make a
written undertaking before date of the Shareholders' General Meeting, and
agree to accept the nomination and undertake that the relevant personal
particulars disclosed by the Company are true and complete, pledge to
perform the duties of a director after being elected. The nominator of the
candidate for the post of independent directors shall issue an opinion on
the qualifications and independency of his assuming the post of independent
director, and the nominee shall issue an open statement stating that he and
the Company do not have any relationship that may affect its independent and
objective judgment.
1. Article 68 of the original Articles of Association will be changed to:
" Article 70 The Shareholders' General Meeting will adopt the method of
voting by registered ballot.
The accumulating ballot system will be put into practice during the election
of directors at a Shareholders' General Meeting. Every share represents the
same voting rights as the number of elected directors. The shareholders may
focus on electing one director or elect several directors, the candidate who
has gained more affirmative voting rights be elected a director, until the
number of directors meets the required number. The number of affirmative
voting rights of every elected director shall exceed half of the total
number of voting shares present at the Shareholders' General Meeting."
2. " Item 5 Related Transactions" will be added to Article 4, Chapter 4 of the
original Articles of Association.
"Item 5 Related Transactions
Article 79 The Company shall sign a written agreement with the related
person in respect of the related transactions. The agreement shall comply
with the principles of equality, voluntariness, making compensation for
equal value, and the contents of the agreement shall be clear and specific.
The Company shall disclose the entering into, changes, termination or
performance etc of the agreement in accordance with the relevant
stipulations "
Article 80 The Company shall take effective measures to prevent the related
person from intervening in the operation of the Company through monopoly
purchases or sales channels and damaging the interests of the Company. The
related transaction activities shall comply with the commercial principles,
and the price of the related transaction shall not in principle deviate from
the price or the fee schedule of an independent third party in the market.
The Company shall fully disclose the pricing basis of the related
transaction.
Important related transactions of which the amount exceeds 30 million yuan
or which amounts to more than 5% of the recently audited net asset value
shall be only carried out after confirmation by the independent directors
and submission to the Board of Directors for discussion, and approval by the
Shareholders' General Meeting.
Article 81 The assets of the Company shall belong to the Company. The
Company shall take effective measures to prevent the shareholders and other
related parties from occupying or transferring the capital, assets and other
resources of the Company by all kinds of methods. The Company shall not
provide guarantees for its shareholders or other related parties except for
the interest of the Company."
3. Article 78 of the original Articles of Association will be changed to:
"Persons under the circumstances described in the Articles 57 and 58 of the
Company Law or prohibited to the market by China Securities Regulatory
Commission (CSRC) and the ban is still not lifted shall not assume the post
of directors of the Company. The directors of the Company should assume the
following obligations:
1. Directors shall perform their duties faithfully, honestly and diligently in
the interest of the Company and all the shareholders to the greatest extent;
2. Directors shall ensure to have sufficient time and energy to perform their
duties;
3. Directors shall maintain a serious attitude when attending Board Meetings,
and shall express clear opinions towards all the subjects of the meeting. In
case a director certainly cannot attend the Board Meeting in person, he may
authorize in writing other directors to vote on his behalf, and the
appointer shall bear legal liabilities independently.
4. Directors shall comply with the relevant stipulations of the laws,
regulations and Articles of Association, and shall abide strictly by the
undertakings they have made in public.
5. Directors shall actively participate in training to understand their rights,
obligations and responsibilities and be familiar with the relevant laws and
regulations, master the relevant knowledge that directors should possess.
6. If the Company suffers loses as the resolution of the Board of Directors
violates the stipulations of the laws, regulations and Articles of
Association, the directors who have made the resolution shall indemnify the
Company accordingly, except the directors who have raised objection during
the vote according to the minutes of the meeting.
7. Upon approval of Shareholders' General Meeting, the Company may take out
insurance for the directors. But except for the liability of directors who
have violated the laws, regulations and Articles of Association."
1. Article 79 of the original Articles of Association will be changed to:
"Article 84 Directors shall be elected or changed by the Shareholders'
General Meeting, and the term shall be 3 years. At the expiry of the term,
directors may be re-elected and may serve another term. The continuous term
of an independent director shall not exceed 6 years. Before the expiry of
the term of the directors, the Shareholders' General Meeting shall not
dismiss them without any reason. The term of a director shall be calculated
from the date the resolution of the Shareholders' General Meeting was
passed, until the expiry of the term of this Board of Directors."
2. Article 85 of the original Articles of Association will be changed to:
"Article 89 In case that a director is unable to attend a Board Meeting in
person two times consecutively, and fails to authorize other directors to
attend the Board Meeting, or an independent director fails to attend a Board
Meeting in person three times consecutively, they shall be deemed to fail to
perform their duties, and the Board of Directors shall suggest the
Shareholders' General Meeting to dismiss or change these directors."
3. Article 87 of the original Articles of Association will be changed to:
" Article 91 If the resignation of a director causes the number of the
directors of the Board of Directors to the less than the minimum number
stipulated, the resignation report of such director will not become
effective until the next term director was elected to occupy the vacancy. If
the resignation of an independent director causes the proportion of
independent directors of the Board of Directors to be less than the minimum
requirement stipulated in these Articles, the resignation report of such
independent director will not become effective until the next term
independent director was elected to occupy the vacancy. The remaining Board
of Directors shall convene a Special General Meeting as soon as possible and
elect a director to occupy the vacancy caused by the resignation of the
director. Before a resolution was made for the election of the director at
the Shareholders' General Meeting, the rights of the resigning director and
the remaining Board of Directors shall be limited reasonably."
4. Article 93 of the original Articles of Association will be changed to:
" Article 97 The Board of Directors shall be comprised of 17 directors, of
which 3 shall be independent directors. The Board of Directors shall have a
chairman an a vice chairman."
5. One article will be added to Article 99 of the original Articles of
Association:
" Article 104 When the Board of Directors is not in session, the chairman is
authorized by the Board of Directors to perform certain duties of the Board
of Directors. This authorization shall be based on safeguarding the interest
of the shareholders and the Company and under the prerequisite of the
standardizing operation of the Company shall ensure the flexible, effective
and safe operation of the policy-making body of the Company in order to
satisfy the actual requirements of the operation of the Company. The
authorization of the chairman by the Board of Directors shall be approved by
the Board of Directors. In accordance with the stipulations of the laws,
regulations, standardizing documents and these Articles, the chairman shall
not be authorized to exercise those rights that should be exercised by the
Board of Directors."
6. Article 102 of the original Articles of Association will be changed to:
" Article 107 Under each of the following circumstances, the chairman shall
convene a Special Board Meeting within 15 working days:
1. When the chairman deems necessary;
2. When more than one-third of the directors jointly propose;
3. When two or more (including two) independent directors jointly propose;
4. When the Board of Supervisors proposes;
5. When the general manager proposes."
1. One article will be added to Article 102 of the original Articles of
Association:
" Article 108 If two or more (including two) independent directors are of
the view that the information is insufficient or unclear, they may jointly
ask in writing the Board of Directors to postpone the Board Meeting or delay
to resolve this subject, the Board of Directors shall adopt the suggestion."
2. Article 103 of the original Articles of Association will be changed to:
" Article 109 The notice of a Special Board Meeting shall be in writing
(including by fax), or by telephone but shall be subsequently confirmed in
writing by the relevant directors. The notice shall be submitted 10 days
before the meeting, but may not be subject to this requirement if all the
directors agree. In case that under the circumstances stipulated in items 2,
3, 4, 5, Article 107 of this chapter, the chairman is unable to perform his
duties, the vice chairman or a director shall be appointed to convene a
Special Board Meeting on behalf of the chairman; if the chairman is unable
to perform his duties without any reason, and has not appointed specific
persons to replace himself to perform his duties, a director shall be
suggested by the vice chairman or more than half of the directors to convene
the meeting.
3. Two articles will be added to Article 2, chapter 5 of the original Articles
of Association:
" Article 3 Independent Director
Article 118 The Company shall put into practice the independent director
system in accordance with the relevant stipulations. The number of
independent directors shall not be less than two.
Independent directors are directors who assume no positions other than
director in the Company, and have no relations that may affect their
independent and objective judgement with the Company and major shareholders.
Article 119 Independent directors shall have the obligations to be honest
and diligent to the Company and all the shareholders. Independent directors
shall seriously perform their duties and safeguard the overall interest of
the Company, especially shall protect the lawful interests of medium and
small shareholders from being damaged in accordance with the laws,
regulations, these Articles and other standardizing documents. Independent
directors shall perform their duties independently, and shall not be
affected by the major shareholders of the Company, the actual controller or
other interested units or persons.
Article 120 The basic requirements for the independent directors shall be as
follows:
1. Possess the qualifications of holding the post of directors of listed
companies in accordance with the laws, administrative regulations and other
relevant stipulations.
2. Possess the independency required by these Articles.
3. Possess the basic knowledge of the operation of listed companies, be familiar
with the relevant laws, administrative regulations and rules.
4. Possess more than 5 years' working experience in law, economics or other
experience required for performing the duties of an independent director;
one or more of the independent directors should be professional accountants
possessing the titles of senior accountant or registered accountant.
5. In principle be concurrent independent director in less than 5 listed
companies, and shall make sure to have sufficient time and energy to
effectively perform his duties as independent director.
Article 121 The following personnel should not hold the post of independent
director of the Company:
1. Personnel and their lineal relatives, main social relationships holding
positions in the Company or its subsidiary enterprises. Lineal relatives
shall mean spouse, parents and children etc. Main social relationships shall
mean brothers and sisters, mother and father-in-law, son or daughter-in-law,
spouses of brothers and sisters, brothers and sisters of spouses etc.
2. Natural person shareholders and their lineal relatives directly or indirectly
holding 1% or more of the outstanding shares of the Company or among the top
10 shareholders of the Company.
3. Personnel or their lineal relatives who hold positions in the shareholder
enterprises holding 5% or more of the outstanding shares of the Company or
personnel or their lineal relatives who hold positions in the top 5
shareholder enterprises of the Company.
4. Personnel who was under the above-mentioned three circumstances in the
previous year.
5. Personnel providing financial, legal and consulting services etc to the
Company or its subsidiary enterprises.
6. Other personnel stipulated by these Articles.
7. Other personnel confirmed by CSRC.
Article 122 The nomination, election and change of the independent directors
shall be carried out normally in accordance with the laws:
1. The Board of Directors, Board of Supervisors, shareholders holding or jointly
holding more than 1% of the outstanding shares of the Company may nominate
candidates for the post of independent directors, and the candidates shall
be elected and decided by the Shareholders' General Meeting. Independent
directors shall be appointed by the Shareholders' General Meeting.
2. Before the nomination of the nominee for the independent director, the
nominee's opinion should be solicited. The nominator shall fully understand
the occupation, educational background, title and detailed working
experience, all the concurrent positions of the nominee, and shall express
his opinion on the qualifications and independency of the nominee. The
nominee shall declare in public that he and the Company have no relations
that may affect his independent and objective judgement.
Before the election of the independent directors at the Shareholders'
General Meeting, the Board of Directors of the Company shall publish the
above contents according to the stipulations.
3. Before the election of the independent directors at the Shareholders' General
Meeting, the Company shall submit simultaneously all the relevant documents
of the nominee to CSRC, local CSRC subsidiary authorities and the stock
exchange where the stock of the Company was listed. For the nominee who has
been objected by the Board of Directors, a written opinion of the Board of
Directors shall be submitted simultaneously.
The nominee who has been objected by CSRC could be the candidates for the
post of directors of the Company, but not the candidates for the post of
independent directors.
During the election of independent directors at the Shareholders' General
Meeting, the Board of Directors of the Company should explain whether the
candidates have been objected by CSRC.
4. The term of independent directors is the same as that of the other directors.
Independent directors may be re-elected and serve another term at the expiry
of the term, but the total term shall not exceed 6 years.
5. The independent directors not present at the Board Meeting in person 3 times
consecutively should be removed upon proposal by the Board of Directors to
the Shareholders' General Meeting.
6. If the independent directors do not comply with the independency requirements
or other circumstance required by the duties of independent directors, thus
resulting in that the number of the independent directors of the Company is
less than the required number in these Articles, the Company shall make up
the number of independent directors according to the stipulations.
7. Except for the circumstances stipulated by the Company Law and these Articles
of being unable to hold the post of directors and independent directors, the
independent directors shall not be dismissed without any reason before the
expiry of the term. If so, the Company shall disclose it as a special
matter. The dismissed independent director may issue a statement in public
if he thinks the reason of dismissal is inappropriate.
8. Independent directors may resign before the expiry of the term. Independent
directors shall submit a resignation report in writing to the Board of
Directors, and explain all the circumstances relating to his resignation or
where the attention of the shareholders and creditors of the Company shall
be drawn.
Article 123 Besides the rights of directors, independent directors may
exercise the following special rights:
1. Important related transactions shall be approved by the independent directors
before submitting to the Board of Directors for discussion. Before judgement
by the independent directors, they may appoint an intermediary institution
to issue an independent financial advisor's report as the basis of the
judgement.
2. Suggest the Board of Directors to appoint or dismiss an accountant firm.
3. Request for the Board of Directors to hold a Special General Meeting.
4. Suggest holding a Board Meeting.
5. Independently appoint external auditing authority and consulting authority.
6. Collect openly the voting rights from the shareholders before the
Shareholders' General Meeting.
The joint agreement of two or more (including two) independent directors
shall be obtained before performing the above duties.
Article 124 In case the duties of independent directors could not be
performed normally or their proposal was not adopted, the Company should
disclose the relevant circumstance.
7. Article 125 Besides the above duties, independent directors shall also
express their independent opinion to the Board of Directors or the
Shareholders' General Meeting of the matters as follows:
1. Nominate, appoint and remove directors;
2. Appoint or dismiss senior management officers;
3. Salary and remuneration of directors and senior management officers of the
Company.
4. Current or newly occurred borrowings or other capital intercourse of the
shareholders, actual controllers and other related enterprises to the
Company amounting to more than 3 million yuan or higher than 5% of the
recently audited net asset value of the Company, and whether the Company has
taken effective measures to recover the borrowings;
5. Matters that the independent directors think could damage the interest of the
medium and small shareholders;
6. Other matters stipulated by these Articles.
The independent directors shall express their opinions about the above
matters, the type of opinion includes agreement, agreement with reservation
and the reason, objection and the reason and unable to state their views and
the obstacle.
For the relevant matters needed to be disclosed, the Company shall announce
the opinion of the independent director. When the opinions of the
independent directors cannot come to an agreement, the Board of Directors
shall disclose the opinions of all the independent directors respectively.
Article 126 In order to assure the effective performance of the duties of
the independent directors, the Company shall provide the necessary
conditions for the independent directors as follows:
1. The Company shall make sure that the independent directors have the equal
right to know as other directors. For all the matters that should be decided
by the Board of Directors, the Company shall notify in advance the
independent directors and provide sufficient documents. The independent
director could ask for additional documents if he thinks that the documents
are not sufficient. In case that two independent directors are of the view
that the documents are not sufficient or the demonstrations are not clear,
they may suggest in writing to the Board of Directors to postpone the Board
Meeting or resolve this matter later, the Board of Directors shall adopt
their suggestion.
The documents provided by the Company to the independent directors shall be
kept for at least 5 years by the Company and the independent directors
themselves.
2. The Company shall provide the independent directors with the necessary work
conditions to perform their duties. The secretary to the Board of Directors
shall actively assist the independent directors to perform their duties,
such as introducing the information and providing documents etc. If the
independent opinions, proposals and written explanation of the independent
directors need to be announced, the secretary to the Board of Directors
shall deal with the announcement matters with the stock exchange on time.
3. When the independent directors perform their duties, the relevant personnel
of the Company shall assist actively and shall not refuse, impede or
conceal, and shall not intervene the independent directors to perform
independently their duties.
4. The costs in relation to the appointment of intermediary institutions by the
independent directors and other reasonable charges for the performance of
the duties of the independent directors shall be borne by the Company.
5. The Company shall give appropriate allowances to the independent directors.
The standard of the allowances shall be proposed by the Board of Directors
and approved by the Shareholders' General Meeting, and shall be disclosed in
the annual report of the Company.
Besides the above-mentioned allowances, independent directors shall not
obtain other extra and undisclosed interest from the Company, its major
shareholders or other interested institutions or persons.
Chapter 4 Special Committees of the Board of Directors
Article 127 The Board of Directors of the Company shall set up the Strategy
Committee, Auditing Committee and Examination and Salary Committee. All the
members of the special committees shall be comprised of the directors, in
which the independent directors shall occupy the majority of the positions
in the Auditing Committee and Examination and Salary Committee and shall be
the convenor. There shall be at least one independent director in the
Auditing Committee who shall be professional accountants.
All the special committees of the Board of Directors are responsible for the
Board of Directors, the proposals of the special committees shall be
submitted to the Board of Directors for examination and decision.
Article 128 Members of the special committees shall be elected by the Board
Meeting and the term shall be the same as that of this Board of Directors.
The special committees of the Board of Directors shall hold at least 2 work
meetings each year. The special committees of the Board of Directors shall
submit the detailed work regulations including the convening, holding,
proposals, resolutions, duties, work methods and personnel constitution etc
to the Board of Directors for approval before implementation.
Article 129 The main duties of the Strategy Committee shall be to study the
long-term development strategy and important investment decisions and to put
forward proposals.
Article 130 The main duties of the Auditing Committee shall be:
1. To suggest to appoint or change external auditing institutions;
2. To supervise the internal auditing system of the Company and its
implementation;
3. To be responsible for the communication between the internal and external
auditing;
4. To examine the financial information of the Company and its disclosure;
5. To examine the internal control system of the Company.
Article 131 The main duties of the Examination and Salary Committee shall
be:
1. To study the examination standards of the directors and managers, carry out
the examination and put forward proposals;
2. To study and examine the salary and remuneration policy and proposals of the
directors and senior management officers.
Article 132 The special committees of the Board of Directors may appoint
intermediary institutions to provide professional opinions and the relevant
costs shall be borne by the Company."
1. One article will be added to Article 129 of the original Articles of
Association:
"The supervisors shall have the right to know the operation of the Company
and bear the relevant confidentiality obligations.
2. One article will be added to Article 135 of the original Articles of
Association:
"Article 156 The Company shall have a Board of Supervisors. The Board of
Supervisors shall be comprised of 7 supervisors, 2 of them shall be staff
representatives. The Board of Supervisors shall have one convenor. In case
that the convenor is unable to perform his duties, another supervisor shall
be appointed by the convenor to replace him to perform his duties.
The Board of Supervisors shall be responsible for all the shareholders. In
order to protect the legal interest of the Company and the shareholders, the
Board of Supervisors shall supervise the finance of the Company and
supervise if the directors, managers and other senior management officers
have performed their duties in accordance with the laws and regulations. If
the Board of Supervisors finds that directors, managers and other senior
management officers have violated the laws, regulations or these Articles,
the Board of Supervisors may report to the Board of Directors and the
Shareholders' General Meeting, and may also report directly to the
securities supervisory authorities and other relevant departments.
The supervisory record of the Board of Supervisors and the results of
financial or special examination shall be regarded as the important basis
for the appraisal of achievements of directors, managers and other senior
management officers.
3. Two articles will be added to Article 138 of the original Articles of
Association:
" The Board of Supervisors shall hold meetings on a regular basis, and shall
hold special meetings when necessary. In case that a meeting of the Board of
Supervisors cannot be held as scheduled, an announcement shall be published
and the reason thereof should be explained.
The Board of Supervisors may ask the directors, managers, other senior
management of the Company, and internal and external auditing personnel to
attend meetings of the Board of Supervisors and answer questions of
interest.
The Board of Supervisors shall work out the rules of procedure."
4. A chapter will be added to Chapter 7 of the original Articles of Association:
" Chapter 8 Appraisal of achievements of directors, supervisors and managers
Article 164 The Company shall set up fair and transparent standards and
procedures of the appraisal of achievements of directors, supervisors and
managers to form an encouragement system related to personal salary and
achievements of the Company and personal achievements.
Article 165 The appraisal of achievements of the directors and managers
shall be organized by the Examination & Salary Committee of the Board of
Directors, and this appraisal shall be regarded as the basis of determining
the salary and remuneration, encouragement and rewards and punishments.
The appraisal of the independent directors and supervisors shall adopt the
method of combination of self-appraisal and mutual appraisal.
Article 166 The amount and type of the remuneration of the directors shall
be proposed by the Board of Directors and approved by the Shareholders'
General Meeting. The director shall withdraw during the appraisal and
discussion of his salary by the Board of Directors or the Examination and
Salary Committee.
Article 167 The Board of Directors and the Board of Supervisors shall report
to the Shareholders' General Meeting the performance of the duties, results
of the appraisal of achievements and the salary and remuneration of the
directors and supervisors, and shall disclose the same accordingly."
The numbering of the remaining articles of the Articles of Association shall
be changed accordingly.
Zhejiang Southeast Electric Power Company Limited
Notice to convene the 2001 Shareholders' General Meeting
Zhejiang Southeast Electric Power Company Limited will convene the 2001
Shareholders' General Meeting on 10th May 2002. Details of the meeting are as
follows:
1. Time of the meeting: 10th May 2002 at 9:00 a.m.
2. Venue of the meeting: Wanghu Hotel, Hangzhou (No. 2 Huancheng Xi Road,
Hangzhou)
3. Agenda:
1. To review the report of the Board of Directors of the Company for 2001.
2. To review the report of Board of Supervisors of the Company for 2001.
3. To review the financial report of the Company for 2001.
4. To review the proposal for distribution of profits of the Company for
2001.
5. To review the financial budget report of the Company for 2002.
6. To review the proposal on establishing the independent director system
and special committees of the Board of Directors.
7. To review the proposal on the changes of directors and supervisors and
appointment of independent directors.
8. To review the proposal on renewing the appointment of the Accountants.
9. To review the proposal on amending the Articles of Association.
4. Attendees of the meeting:
1. Directors, supervisors and other senior management officers of the
Company.
2. Shareholders of the Company who have registered at Shanghai Securities
Central Clearing & Registration Corporation by the time the market
closes in the afternoon of 8th April 2002. The last day for trading of
the Company's B Shares shall be 3rd April 2002.
3. Authorized proxies of the shareholders.
5. Registration for the meeting
1. Individual shareholders shall produce their identity cards and
shareholders' account cards (authorized proxies shall produce their
identity cards, proxy forms and shareholders' account cards); legal
person shareholders shall be represented by legal representatives or
their authorized proxies. Legal representatives shall produce their
identity cards, evidence sufficient to confirm their qualification and
shareholders' account cards. (Authorized proxies shall produce their
identity cards, proxy forms in writing issued by the legal
representative according to law and shareholders' account cards);
overseas shareholders may register by way of post or fax.
2. Time of registration: 0800 to 1100 and 1400 to 1700, 18th April 2002.
3. Place of registration: Office of the secretary to the board of directors,
22nd Floor, Triplenic Mansion 528 Yanan Road, Hangzhou. (postal code
310006)
4. Contacts: Wei Zheng, Chen Mingdong
Telephone: 86-571-85774566
Fax: 86-571-85774321
Other matters
The meeting will last half a day. The attendees shall bear their own costs
of transportation, board and lodging.
Board of Directors
Zhejiang Southeast Electric Power
Company Limited
18th March 2002
Proxy Form
This is to fully authorize Mr./Ms. _____to attend the 2001 Shareholders'
General Meeting of Zhejiang Southeast Electric Power Company Limited and
vote on my behalf.
Appointer (signature)______ Account card no.:______________
Number of shares held_________ Date of authorization:___________
Appointee (signature):_________
Zhejiang Southeast Electric Power Company Limited
Announcement of Resolutions of the 6th Meeting of the 2nd Board of Supervisors
The 6th Meeting of the 2nd Board of Supervisors of Zhejiang Southeast Electric
Power Company Limited was convened on 14th March 2002 at Wanghu Hotel, Hangzhou.
Seven supervisors should attend and seven supervisors attended the meeting,
complying with the stipulations of the Company Law of the PRC and Articles of
Association of the Company. The supervisors considered and adopted the following
resolutions:
1. Approve and adopt the work report of the Board of Supervisors for 2001.
2. Approve and adopt the proposal on the changes of supervisors.
Kong Fanxiang and Huang Peigen will no longer be supervisors of the Company
due to work and retirement reasons. Mr. Jiang Huadong and Yang Jianxiong are
nominated as candidates for the posts of supervisors of the Company.
3. Approve and adopt the proposal on the provision for four items reserve.
4. The Board of Supervisors is of the view that the contents of the 2001 annual
report and its summary are true, accurate and complete, and there are no
false representations, material omissions and misleading statements. Both
the domestic and overseas accountants of the Company have issued auditors'
reports with no reservations and agreed to make the disclosure.
Board of Supervisors
Zhejiang Southeast Electric Power Company Limited
18th March 2002
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