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Zhejiang Southeast Electric Power Company Limited

 

Announcement on Resolutions of the Twenty-Ninth Meeting of 

the Fourth Session of the Board of Directors 

 

The Twenty-Ninth Meeting of the Fourth Session of the Board of Directors of Zhejiang Southeast Electric Power Company Limited (the 'Company') was convened on 19 March 2009 at Hangzhou Xihu State Guesthouse by way of a written notice issued on 4 March 2009 (the 'Meeting').  Fifteen directors should be present and thirteen directors were present at the Meeting. Director Zhang Qian and Director Xing Junjie were absent from the Meeting due to other business arrangements, who respectively appointed Director Mao Jianhong and Liu Ranxing as proxy to attend the meeting and vote on his behalf. The supervisors and senior management of the Company were present at the meeting. The convening of the Meeting was in compliance with the stipulations of the Company Law and the articles of association of the Company and was therefore legal and effective. The Meeting was chaired by Mr. Mao Jianhong, Chairman of the Company. The following proposals were reviewed and approved at the meeting:

 

            1.       Work Report of the Board of Directors for Year 2008;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote. 

 

2.   Work Report of the General Manager for Year 2008; 

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

3. Work Report of the Independent Directors for Year 2008; 

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

4. Proposal on the Amendments to the Implementation Rules of the Audit Committee of the Board of Directors of the Company;

Pursuant to the requirements of Announcement of China Securities Regulatory Commission [2008] No.48, it was agreed that the following articles be added in Chapter 6 'Working Procedure of the Annual Report' under the Implementation Rules of the Audit Committee of the Board of Directors of the Company: 

      Article 25    

The Audit Committee should focus on the scenario of change the appointment of audit firm during audit period of the Company's Annual Report. As a principle, the Company is not allowed to make such change of appointment during audit period of the Annual Report, however, in the event of substantial needs to change the appointment, the Audit Committee should specifically meet with both the preceding and replacement audit firms, fairly assess the performance quality of both firms as well as the grounds for such change of appointment proposals.  The conclusions of the Audit Committee are subject to approval at the meeting of the Board of Directors. After the approval by the Board of Directors, a shareholders' meeting shall be convened, at which representatives of the preceding audit firm shall be notified to attend and state their positioning.  

     

      Article 26

Prior to re-appointing the audit firm for the next year's Annual Report, the Audit Committee should perform a thorough and objective assessment over its performance and quality of deliverables over the current year's Annual Report auditing. Any positive comments as achieved should be submitted for review at the meeting of the Board and shareholders' meeting, whereas, substitute auditing firms should be selected if negative comments are reached thereto.    

    

      Article 27    

In the event of change of appointment of the audit firm for the next Annual Report auditing, the Audit Committee should achieve a thorough understanding and proper assessment of both the preceding and the replacement audit firms by way of interpersonal communication, the results of which should be submitted for approval at Board meeting and shareholders' meeting.  

The sequence numbers for clauses under the Implementation Rules of the Audit Committee of the Board of Directors of the Company, including numbering of the quoted clauses shall be arranged in their original order, whose contents are not changed.  

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

For further details, please refer to the revised the Implementation Rules of the Audit Committee of the Board of Directors of the Company published on the website of Shanghai Stock Exchange. 

 

5. Proposal on the Amendments to the Articles of Association of the Company;

Pursuant to the Resolution to Revise Certain Provisions Regarding Cash Dividend Distribution of Listed Companies issued by China Securities Regulatory Commission (CSRC Order [2008] No. 57), it was agreed that the following should be supplemented into Article 155 of the articles of association of the Company:  the Company should maintain a sustainable profit declaration policy.  The Company should declare cash dividends at least once every three years, whilst the accumulative amount of such cash dividends declared in a consecutive three years should be 30% or more of the average per annum dispensable dividends realized in the three years. The Profits Distribution Plan should be formulated by the Board of Directors on the basis of the Company's profitability and future capital expenditure projections, which should be implemented following approval at shareholders' meeting.  

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

6. Financial Settlement Report for Financial Year 2008;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

7. Profits Distribution Plan for Financial Year 2008;

Profits Distribution Plan for Financial Year 2008 of the Company is as follows: taking the after-tax profit of the parent company in the amount of RMB287,395,616.94 audited by the domestic accountants as the base, 10%, that is RMB28,739,561.69 will be allocated into statutory surplus common reserve fund.  No cash dividend will be declared.   

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

The following commentates on the decision not to declare cash dividend in the profitable 2008:  the power generation industry in 2008 suffered severe losses due to policies, which resulted in a lower earning per share realized over the year.  Given  the capital reserve 2009 and projected capital needs in 2009 and 2010 of the Company, in order to secure the capital needs for productions and constructions during 2009, as well as the loan repayment needs which will pick up as of 2009, it was agreed that the Company would not declare dividends in 2008. 

This proposal is subject to review and approval at Annual General Meeting of 2008. 

 

8. 2008 Annual Report and Summary;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

9. 2008 Responsibility Performance Assessment Report;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

10. 2008 Technical Upgrading Report and Budget for 2009 Technical Upgrading;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

 

11. 2008 Audit Work Report and Proposal on Re-appointment of  Accounting Firms  in 2009;

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

In the provision of auditing services for the Company during 2008, Zhejiang Pan-China Certified Public Accountants and PricewaterhouseCoopers Zhongtian Certified Public Accountants delivered satisfactory results in compliance with the practising principle of independence, objectiveness and fairness.

It was agreed to appoint Zhejiang Pan-China Certified Public Accountants and PricewaterhouseCoopers Zhongtian Certified Public Accountants to provide accounting statements auditing and other relevant consultancy services to the Company for the year 2009. The specific annual auditing fees are as follows: RMB1.15 million for Zhejiang Pan-China Certified Public Accountants and RMB1.2 million for PricewaterhouseCoopers Zhongtian Certified Public Accountants.  

 

12. Proposal Regarding Regular Connected Transactions; 

Under abstaining of Connected Directors, namely, Mao Jianhong, Zhang Qian, Cao Lu, and Wang Lina, 

(1)  it was agreed to renew the Financial Services Cooperation Agreement   entered with Zhejiang Energy Group Finance Co., Ltd;

Voting results: votes in favour of the resolution: 11 votes; votes against the  resolution: 0 vote; votes abstained: 0 vote.

(2)  it was agreed that the Company will enter into Natural Gas Sales Agreement with Zhejiang Natural Gas Development Co., Ltd;

Voting results: votes in favour of the resolution: 11 votes; votes against the  resolution: 0 vote; votes abstained: 0 vote.

(3) it was agreed that the Company will enter into Energy Service Cooperation Framework Agreement with Zhejiang Xingyuan Investment Co., Ltd. 

Voting results: votes in favour of the resolution: 11 votes; votes against the  resolution: 0 vote; votes abstained: 0 vote.

Please see details in Announcement of Regular Connected Transactions of the Company.

 

     13.  Financial Budgeting Report for Year 2009;

Voting results: votes in favour of the resolution: 15 votes; votes against the  resolution: 0 vote; votes abstained: 0 vote.

 

14. Proposal Regarding the Change of the Board of Directors;

Candidate Directors of the Fifth Session of the Board are: Mao Jianhong, Zhang Qian, Cao Lu, Wang Lina, Shou Desheng, Sun Weiheng, Chen Jimin, Yao Xianguo, Wo Jian, Gu Biquan, Xing Junjie, Fu Qiyang, Liu Hong, Qiu Guofu, and Yan Weimin, amid these, Chen Jimin, Yao Xianguo, Wo Jian, and Yan Weimin are candidates for Independent Directors.  

Voting results: votes in favour of the resolution: 15 votes; votes against the  resolution: 0 vote; votes abstained: 0 vote.

 

15. Proposal on Convening the Annual General Meeting of 2008.

Voting results: votes in favour of the resolution: 15 votes; votes against the resolution: 0 vote; votes abstained: 0 vote.

Please see details in Announcement on Convening Annual General Meeting of 2008.  

                                                                               Board of Directors

                                                   Zhejiang Southeast Electric Power Company Limited

                                                                                   21 March 2009 

        

Appendix: Profile of Director Candidates

Mao Jianhong, male, born in 1964, Professor-level Senior Engineer. Mr. Mao held positions such as Deputy General Manager at Zhejiang Electric Power Construction Co., Ltd, General Manager at Zhejiang Beilun First Power Generation Co., Ltd., and Assistant to General Manager at Zhejiang Energy Group Co., Ltd. Mr. Mao is presently Deputy General Manager at Zhejiang Energy Group Co., Ltd.    

Zhang Qian, male, born in 1954, Professor-level Senior Engineer.  Mr. Zhang held positions such as Deputy Chief Engineer, Chief Engineer, Deputy General Manager of Zhejiang Beilun Power Plant, and Deputy Chief Engineer, Assistant to General Manager at Zhejiang Electric Co., Ltd. and General Manager at Zhejiang Electric Power Construction Parent Company and Zhejiang Electric Power Construction Co., Ltd. Mr. Zhang is presently Assistant to General Manager at Zhejiang Energy Group Co. Ltd.   

Cao Lu, male, born in 1965, Economist.  Mr. Cao held positions such as Principal Staff Member at Industrial & Agricultural Products Price Management Department of Zhejiang Provincial Price Bureau, and Vice Director at Service Price Management Department of Zhejiang Provincial Price Bureau. Mr. Cao is presently Director of Assets Operation Department at Zhejiang Energy Group Co., Ltd. 

Wang Lina, female, born in 1963, Senior Accountant. Ms. Wang held positions such as Principal Accountant and Chief Accountant of Financial Properties Department at Zhejiang Electric Power Development Co., Ltd.  Ms. Wang is presently Director of Finance Department at Zhejiang Energy Group Co., Ltd.        

Shou Desheng, male, born in 1957, Senior Economist. Mr. Shou held positions such as Deputy General Manager of Taizhou Power Plant, General Manager of Wenzhou Power Plant, and General Manager of Xiaoshan Power Plant, Deputy General Manager of Zhejiang Southeast Electric Power Company Limited.  Mr. Shou is presently General Manager of Zhejiang Southeast Electric Power Company Limited.

Sun Weiheng, male, born in 1962, Senior Engineer. Mr. Sun held positions such as Assistant to General Manager and Director of Operations of Jiaxing Power Plant, Assistant to General Manager, Director of Equipment Management Department, Deputy Party Secretary-General and Secretary-General of the Disciplinary Committee at Jiaxing Power Generation Co., Ltd.  Mr. Sun is presently General Manager of Taizhou Power Plant.  

Gu Biquan, male, born in 1957, Engineer. Mr. Gu held positions such as Manager of Securities Financing Department, Assistant to General Manager and Manager of Managers Department of Huaneng Power International, Inc., Deputy Director of Electric Power Development Department of Huaneng Group, and Deputy General Manager of Huaneng International Power Development Co., Ltd. Mr. Gu is presently Deputy General Manager of Huaneng Power International, Inc.  

Xing Junjie, male, born in 1958, Senior Engineer.  Mr. Xing held positions such as Deputy Manager of Project Development Department at China Power Investment Corp., and Section Chief at Comprehensive Planning and Investment/Financing Project Department at State Power Corporation of China.  Mr. Xing is presently Deputy Manager of Planning and Development Department of Huaneng Power International, Inc.  

Fu Qiyang, male, born in 1963, Senior Accountant. Mr. Fu held positions such as Deputy Chief Accountant at Yimin Huaneng East Power and Thermal Power General Co. Ltd., and Chief of Finance Division I at China Huaneng Group. He is presently Deputy Manager of Marketing Department of Huaneng Power International, Inc.

Liu Hong, male, born in 1959, Senior Engineer. He held positions such as Senior Engineer of Managers Department, Deputy Section Chief and then, Section Chief of the Secretariat at Huaneng Power International, Inc.  Mr. Liu is presently Deputy Manager of Equity Management Department at Huaneng Power International, Inc.

Chen Jimin, male, born in 1943, Professor-level Senior Engineer, beneficiary of an honourable grant from the States Council.  Mr. Chen held positions such as Deputy Director/VP Assistant Secretary-General of the Party Branch, Director (General Manager), and Secretary-General of the Party Branch of Zhejiang Provincial Industrial Power Bureau (Corp.), and Secretary-General of the Party Branch at Zhejiang Provincial Electric Power Corp. Mr. Chen is presently a member of the Standing Committee of Zhejiang Provincial People's Congress, Deputy Director of Zhejiang Provincial Finance and Economic Committee, and Director Emeritus of Zhejiang Electric Power Association.      

Yao Xianguo, male, born in 1953, Professor of Economics, doctor candidate supervisor, beneficiary of an honourable grant from the States Council.  Mr. Yao held positions such as Administrative Vice President of the Business School of Zhejiang University, and Administrative Deputy Director of the College of Foreign Economics and Trade, and Administrative Deputy Director of the College of Economics. Mr. Yao is presently Director of the School of Public Management of Zhejiang University.  

Wo Jian, male, born in 1960, Professor of Accounting, master candidate supervisor.  Mr. Wo held positions such as Deputy Director of Management Accounting Faculty of Zhejiang University of Finance and Economics, Deputy Director of Accounting School, Deputy Director of Department of Academic Affairs, and Director Advanced Education Technologies Centre. Mr. Wo is presently Director of Department of Academic Affairs of Zhejiang University of Finance and Economics.     

Qiu Guofu, male, born in 1946, Professor-level Senior Engineer. Mr. Qiu held positions such as Deputy Director of Shanghai Industrial Power Bureau, Deputy Director of East China Electric Power Administrative Bureau and Director of Shanghai Electric Power Construct Bureau, Deputy General Manager of East China Electric Power Group Co., Ltd, Secretary-General of the Party Branch and President of Anhui Provincial Electric Power Corp., and Deputy General Manager of East China Grid Co., Ltd. Mr. Qiu is presently a Consultant at East China Grid Co., Ltd.  

Yan Weimin, male, born in 1963, Researcher at Finance Research Centre of Chinese Academy of Social Sciences. Mr. Yan held positions such as Deputy Section Chief of Shenzhen Municipal Office for Economic Restructuring, Section Chief of Shenzhen Municipal Securities Regulatory Office, and Vice President of China Merchants Securities Co. Ltd. Mr. Yan is presently Deputy Director and Secretary-General of both Securities Association of Shenzhen and Listed Companies Association of Shenzhen.               

              

        

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