Samyoung ENC Files Evidence Preservation Application Against Minority Shareholders in Court... "Reviewing Proxy Voting Procedures"

[Asia Economy Reporter Hyungsoo Park] Samyoung ENC, a developer of ship electronic equipment, raised suspicions regarding the proxy voting process related to the shareholders' meeting held on the 15th.

On the 18th, Samyoung ENC announced, "We have filed an application for evidence preservation with the court against the minority shareholders." This is a procedure to verify whether the proxy voting was conducted legally.

Samyoung ENC held an extraordinary shareholders' meeting convened by the minority shareholders on the 15th. The voting rights in favor of the minority shareholders' agenda reached 31%. This exceeded the majority threshold of 25%, approving the agenda. Including abstentions, the minority shareholders gathered 34% of the voting rights.

At the regular shareholders' meeting in March last year, all proposals, including the approval of financial statements, were rejected because the majority shareholder Chairman Hwang Won's 31% voting rights were not exercised, failing to reach the quorum of 25%. Over the past few years, the number of voting rights mobilized by minority shareholders remained at 1-2%.

Samyoung ENC explained, "We have doubts about whether it is possible for minority shareholders to gather 34% of the voting rights at the extraordinary shareholders' meeting."

Among Samyoung ENC's voting rights, the 31% stake held by Chairman Hwang Won is currently frozen due to ongoing adult guardianship proceedings. The company side gathered 21%, and the minority shareholders gathered 34%, including abstentions.

According to Samyoung ENC, the minority shareholders who filed the lawsuit for the extraordinary shareholders' meeting on December 8 last year held more than 3% (about 310,000 shares) at that time. On the record date for the extraordinary shareholders' meeting closure on December 22, they held 0.5% (about 50,000 shares) of the shares.

Samyoung ENC raised suspicions, stating, "Is it possible that small shareholders who held 0.5% of the shares, without any shareholder having reported ownership of 5% or more, legally gathered 34% of the voting rights?"

According to Samyoung ENC, as of the 18th, no shareholders other than majority shareholder Chairman Hwang Won held 5% or more of the shares.

Samyoung ENC filed an application for evidence preservation with the court against the minority shareholders immediately after the extraordinary shareholders' meeting on the 15th. It was explained that in some cases, the addresses of shareholders who supposedly delegated proxy voting to minority shareholders were not properly recorded.

A Samyoung ENC official pointed out, "Samyoung ENC is currently pursuing a 1 billion KRW damages lawsuit against former CEO Hwang Jae-woo," adding, "It is difficult to understand that minority shareholders recommended former CEO Hwang Jae-woo as a director for management normalization."