English translation of the original Korean report. Images and source documents may contain Korean text.

Seoul Central District Court: ‘Insufficient Substantiation of Right to Be Preserved’… Huniverse Global Pursues Change in Largest Shareholder

An injunction request to block a third-party allocated capital increase worth approximately 10 billion won, pursued by Cellid (CEO Kang Chang-yul), a KOSDAQ-listed biotech company, has been dismissed by the court. However, the payment deadline for the capital increase, originally scheduled for November 9, has been postponed to December 8.

According to the Financial Supervisory Service’s Electronic Disclosure System on the 7th, the Seoul Central District Court on the 5th dismissed an injunction application filed by Mr. Lee against Cellid to prohibit the issuance of new shares. The court also ruled that the applicant, who is the creditor, should bear the litigation costs.

The court, considering the entire record and the purport of the interrogation, determined that it was difficult to see that the right to be preserved, which would prohibit the issuance of new shares, had been sufficiently substantiated. Cellid received the decision from its legal representative on the same day and disclosed the relevant details.

This dispute is related to the third-party allocated capital increase resolved by Cellid’s board of directors on September 21. Cellid plans to issue 4,796,163 common shares to Huniverse Global at 2,085 won per share, raising a total of 9,999,999,855 won.

The applicant filed an injunction to prohibit new share issuance on October 24, and Cellid disclosed this on October 28. Although the initial application also included a request to prohibit the submission and voting on the agenda for the appointment of directors at an extraordinary general meeting of shareholders, after an amendment to the application and partial withdrawal on November 4, only the claim to prohibit new share issuance remained.

■ Injunction Dismissed, But Capital Increase Schedule Postponed by One Month

Prior to the injunction decision, Cellid changed the capital increase payment deadline from November 9 to December 8 on the 4th. On the same day, the date for the extraordinary general meeting of shareholders was also postponed from November 10 to December 9. The company specified in its disclosure that the schedule change was due to the injunction application to prohibit new share issuance.

If the payment for this capital increase is made, Huniverse Global will become Cellid’s new largest shareholder. The management rights change agreement includes the appointment of four directors and one auditor designated by Huniverse Global, and the appointment of a CEO designated by Huniverse Global in the new board of directors. However, the related change in management rights is conditional on the payment of the capital increase and other contractual terms, such as attracting additional investment.

Cellid is a biotech company that develops anti-cancer immunotherapy vaccines and infectious disease prevention vaccines. The funds from this capital increase are intended to secure operating capital, and once the change in management rights with Huniverse Global is completed, changes in future business operations and governance structure are expected.

While the risk of new share issuance being prohibited due to this application has been resolved with the dismissal of the injunction, the actual payment for the capital increase and the change of the largest shareholder are not yet confirmed. The payment status on December 8 and the results of the extraordinary general meeting of shareholders on December 9 are expected to be key variables for the change in management rights.