PSPD in English Socio-Economic 2004-01-19   943

[Press Release] PSPD hold press conference on SK conglomerates group’s minority shareholders movement

PSPD hold press conference on SK conglomerates group’s minority shareholders movement

To announce PSPD’s action plan on the reformation of SK Corp and SK Telecom corporate ownership structure
To address the plan of filing SK Shipping related representative suits against directors including Mr. Kil Seung Son

1. Economic Reformation Center(ERC) of PSPD(Director: Professor.Sang Jo Kim, Hansung Unitersity) held a press conference 19.Jan., addressing its stand on and the agenda for the reformation of the corporate ownership structure of SK and SK Telecom, each expected to have 2004 general shareholders meetings soon.
In the conference, ERC also announced its plan to start from March a shareholders’ representative suit against board of directors of SK Marine Transportation including CEO, Mr. Kil Seung Son., who is responsible for the damage incurred by the illegal outflow of SK Shipping’s fund.

2. In the agenda presented by ERC, PSPD, are included the overall revision of the articles of association of SK for the reformation of the company ownership structure as well as the resignation of Mr. Tae Won, Choi, Mr. Kil Seung Son, and Mr. Chang Keun Kim who are accountatble for a variety of illegal acts and insolvent management, from the board of directors of SK and SK Telecom. PSPD explained as well the outcomes from the discussion with the company, the debtors and Sovereign on the agenda suggested by itself. PSPD also added they will not participate in the coming SK’s general shareholders’ meeting with the activities like the recommendation of representative excise of voting rights.
And for SK Telecom shareholders’ general meeting, it plans to introduce a shareholders’ resolution of the recommendation for the resignation of Mr. Tae Won Choi and Mr. Kil Seung Son with each having another 1 year to complete their corporate offices. – The end.

PSPD Press Conference for SK Conglomerates group minority shareholers’ movement

19.January, 2004, Conference room, PSPD

Orders
SK Corp related
SK Telecom related
SK Shipping related

Ⅰ. SK Corp related

(1) PSPD Agenda for the reformation of SK Corp corporate ownership structure

Principle 1.
For the improvement in the corporate ownership structure, the followings are required ; i) the calling to account for illegal and improperly-run management, ii) the reformation in the make-up of border of directors, iii) the revision of the articles of the association

Principle 2
For win-win strategy, corporation between current management, domestic and overseas institutional investors, debtor groups and minor shareholders is needed.

Inside directors
– Mr. Tae Won Choi, Mr. Kil Seung Son and Mr. Chang Keun Kim
have to resign thier positions as registered directors
* Mr. Son and Mr. Kim supposed to take a voting for renomination
in 2004 general shareholders meeting
* Mr. Choi supposed to take a voting for reassignment
in 2005 general shareholders meeting
– Mr. Tae Won Choi is admitted to remain in company management
as non-registered executive officers.
* It is because for the revision of the articles of the association, a key point
for the improvement in the company ownership structure, corporation
from management is required.
* On the other hand, Mr. Son and Mr. Kim should step back from
the company management as well.

Outside directors
– Nominee : 3 persons (2 for outside directors and auditors)
– To designate among candidates recommended by shareholders
– To designate candidates who all involving interests group vote for


Over 2/3 of approval out of votes present in shareholders’ general meeting
required, which means the agreement between a variety of shareholders
is essential for the revision of the articles of the association.

The establishment of internal trading committee
– All members made up of outside directors
– For over the certain amount of internal trading, prior approval from
the committee is needed.
* For the case of SK Telecom, in the internal trading of over 10 billion won on yearly basis, prior approval required.
– trading volume, standards, procedure and etc expected to be stipulated in the Committee regulations.

The improvement in voting procedure for the nomination of directors
– To choose Cumulative Voting
To protect the equality among shareholders and the right of minor
shareholders
– The introduction of electronics voting and a written voting

The proportion of outside directors
– Over the half of all members of BOD
* Current proportion being 50%

The eligibility of directors
– The positions of registered directors sentenced over the confinement to be
considered vacancies (being eliminated out of BOD)
– already chose by SK Telecom

The eligibility of outside directors
– Those who don’t work at SK Corp and its affiliates within at least last 3
years
– Those who are not involved in business with SK Corp., which accounts for
over 2 % of total sales. (Current law regulating 10%)

The opening of executive directors’ salary to the public
– To publicize individual directors’ salary of the last financial year
when submitting an approval item on executive directors’ salary cap.

(2) Responses of key interest group toward PSPD suggestion
– Oral explanation

(3) PSPD’s future plan
– Oral explanation

Ⅱ. SK Telecom related

Mr. Tae Won Choi, Mr. Kil Seung So to resign their positions as registered
directors
– Both of them expected to take a voting for renomination in 2005
– According to the articles of the association, if being sentenced over
confinement, the positions of Mr. Choi and Mr. Son are considered vacancies.
(being eliminated from BOD)

Planed to propose the recommendation of resignation unless they voluntarily
leave the offices.

Ⅲ. SK Shipping related

To file a representative suit against SK Shipping’s BOD members including
Mr. Kil Seung Son – The end.

Participatory Economy Committee

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