Nio announced last week it is holding an extraordinary general meeting, or EGM, of shareholders in Shanghai on June 3.
What’s An EGM: An EGM is any shareholder meeting called by the company other than the regularly scheduled annual general meetings. It is usually convened when something unexpected or urgent comes up between annual shareholders’ meetings.
Why Is Nio Holding An EGM: Nio plans to increase its number of board members from the current five in order to improve the diversity and flexibility of the board, the company’s founder, Chairman and CEO William Li said in the first-quarter earnings call.
Li also said the company wishes to give its user trust the right to nominate directors to the board, although the right to appoint directors will be retained by the board.
The company may be using the meeting to get nominations to fill in the enlarged board size.
Nio’s user trust, which was established at the time of the IPO, has so far been focused on environmental protection, industry subcommittees, social welfare and user care, Li said. The company now wants to allow the trust to take part in decision making, and this will be proposed at the meeting, he added.
“This also showcases our … vision of building a user enterprise, which will also help us to deepen our relationship with the users for the long run,” Li said.
Nio shares, which are trading well off their all-time high hit at the start of the year, ended Friday’s session up 2.18% at $39.84.
Photo courtesy of Nio.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.