SCHEDULE: US Court Bars Activist 1Globe Capital Over Misleading Sinovac Statements; New Board Elected

Sentiment:

Corporate Governance Update 11 July 2025 5:35 PM

A U.S. District Court has issued a preliminary injunction against 1Globe Capital and its owner, Jiaqiang Li, for making materially misleading statements regarding Sinovac Biotech Ltd., coinciding with the election of a new board of directors supported by Vivo Capital.

Better than expectedThe U.S. District Court granted Vivo Capital's motion for a preliminary injunction against 1Globe Capital, compelling them to correct misleading disclosures and cease further deceptive statements.The Eastern Caribbean Supreme Court of Appeals stayed 1Globe's injunction, affirming Vivo Capital and Prime Success's right to vote in the critical shareholder meeting.A new Board of Directors, nominated by SAIF Partners and supported by Vivo Capital, was successfully elected at the Special Meeting of Shareholders, signaling a positive shift in corporate governance.

Summary

The United States District Court of Massachusetts granted Vivo Capital's motion for a preliminary injunction against 1Globe Capital, LLC and Jiaqiang Chiang Li, barring them from making further materially misleading statements about their Sinovac shareholding or intentions.
The court mandated 1Globe to file an amended and accurate Schedule 13D disclosing their beneficial ownership interests, control relationships, group affiliations, and plans related to Sinovac within five days of the order.
The decision cited a prolonged pattern of corruption and deception by 1Globe, including using relatives to build undisclosed positions, failing to make timely disclosures, and forging documents in 2018 and 2020 to unlawfully change directors of Sinovac subsidiaries.
On July 8, 2025, the Court of Appeal of the Eastern Caribbean Supreme Court stayed an injunction sought by 1Globe, allowing Vivo Capital and Prime Success to participate and vote in the Special Meeting of Shareholders.
A new Board of Directors, consisting of the SAIF Partners nominated slate including Mr. Shan Fu, was elected at the Special Meeting of Shareholders held on July 8, 2025, and disclosed by the Issuer on July 10, 2025.
Vivo Capital VIII, LLC beneficially owns 1,361,236 common shares, representing 1.9% of the class.
Vivo Capital IX, LLC beneficially owns 4,541,764 common shares, representing 6.3% of the class.
The beneficial ownership percentages are based on 71,860,702 common shares outstanding as of March 31, 2024.

Sentiment

Score: 8

Explanation: The sentiment is highly positive due to favorable court rulings against alleged deceptive practices, the successful election of a new board aligned with long-term shareholder interests, and clear stated goals for restoring governance, dividends, and NASDAQ trading. This indicates a significant step towards resolving long-standing issues.

Positives

The U.S. District Court granted Vivo Capital's motion for a preliminary injunction against 1Globe Capital, compelling them to correct misleading disclosures and cease further deceptive statements.
The Eastern Caribbean Supreme Court of Appeals stayed 1Globe's injunction, affirming Vivo Capital and Prime Success's right to vote in the critical shareholder meeting.
A new Board of Directors, nominated by SAIF Partners and supported by Vivo Capital, was successfully elected at the Special Meeting of Shareholders on July 8, 2025, signaling a shift towards improved corporate governance.
The election of the new board is expected to facilitate the retention of a new auditor, accelerate a legitimate dividend plan, restore NASDAQ trading, and end costly shareholder disputes.

Negatives

1Globe Capital and Jiaqiang Li were found by the U.S. District Court to have likely violated disclosure obligations and engaged in a prolonged pattern of corruption and deception.
1Globe's alleged misconduct included using undisclosed relatives to build stock positions, failing to make timely disclosures, and forging documents in 2018 and 2020 to unlawfully change directors of Sinovac subsidiaries.
1Globe attempted to illegally disenfranchise Vivo Capital and other shareholders by seeking an injunction to prevent them from voting at the Special Meeting.
The company's trading on NASDAQ remains suspended, and there are ongoing shareholder disputes that have incurred costs.

Risks

Vivo Capital believes that 1Globe Capital, along with OrbiMed, may continue their attempts to harm and disenfranchise shareholders until and unless the Board is fully reconstituted.
Ongoing legal proceedings related to the future of Sinovac, shareholdings, and Board composition could continue to consume resources and create uncertainty.

Future Outlook

With the new Board elected, Vivo Capital believes the company will restore proper governance, which is a critical step to enable Sinovac to retain a new auditor, accelerate the implementation of a legitimate, audited, and realistic dividend plan maximizing all shareholders' returns, get back on track towards restoring trading on NASDAQ, and end all cost-consuming shareholder disputes.

Management Comments

Vivo Capital demonstrated to Judge Myong J. Joun by a substantial likelihood that 1Globe failed to provide disclosures mandated by federal securities laws while they clandestinely formed a group with ally OrbiMed, took control of Sinovac's Board of Directors, carried out plans and proposals to weaken the corporate governance and business of Sinovac, and attempted to enrich themselves at the expense of all shareholders.
Vivo Capital believes that 1Globe, along with OrbiMed, will continue their attempts to harm and disenfranchise shareholders until and unless the Board is reconstituted.
Vivo Capital has remained steadfast in its mission to restore trust in Sinovac's governance, and ultimately, in the company's ability to resume trading and return cash to shareholders.
Vivo Capital echoes the calls by other long-term shareholders, such as SAIF Partners and Prime Success, to remove the current Board, controlled by 1Globe, and vote the GOLD card in favor of SAIF Partners' qualified candidates, and to discard the company's white card.

Industry Context

This announcement highlights the ongoing challenges of corporate governance and shareholder activism within publicly traded companies, particularly those with complex international legal and regulatory landscapes. The dispute between long-term investors like Vivo Capital and activist shareholders like 1Globe Capital underscores the importance of transparent disclosure and adherence to securities laws in maintaining market integrity and investor confidence. The focus on restoring NASDAQ trading and implementing a dividend plan reflects common investor demands for value creation and liquidity in the biotechnology sector.

Management Changes

Role	Previous Person	New Person	Effective Date	Reason
Board of Directors Member	Current Board (controlled by 1Globe)	SAIF nominated slate, including Mr. Shan Fu	July 8, 2025	Election at Special Meeting of Shareholders following successful legal challenges by Vivo Capital and SAIF Partners against the incumbent board and 1Globe Capital's attempts to disenfranchise voters.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Board Composition	A new Board of Directors, consisting of the SAIF nominated slate, including Mr. Shan Fu, was elected at the Special Meeting of Shareholders.	July 8, 2025	Expected to restore proper governance, which is critical for retaining a new auditor, accelerating a dividend plan, restoring NASDAQ trading, and ending shareholder disputes.
Disclosure Compliance	U.S. District Court mandated 1Globe Capital to file an amended and accurate Schedule 13D disclosing beneficial ownership, control relationships, group affiliations, and plans/proposals.	June 30, 2025 (date of injunction)	Aims to enforce transparency and compliance with federal securities laws, correcting past deliberate circumvention of disclosure obligations.

Legal Proceedings

United States District Court of Massachusetts granted Vivo Capital's motion for a preliminary injunction against 1Globe Capital, LLC and Jiaqiang Chiang Li, barring them from making further materially misleading statements and mandating amended disclosures (injunction obtained June 30, 2025).
High Court of Antigua and Barbuda: Issuer filed an application for an injunction seeking to prohibit Vivo Capital and another investor from voting their shares at the Special Meeting (filed May 30, 2025).
Court of Appeal of the Eastern Caribbean Supreme Court granted a motion to stay the injunction sought by 1Globe, allowing Vivo Capital and Prime Success to participate and vote in the July 8th shareholder meeting (order issued July 8, 2025).
High Court of Hong Kong found 1Globe and its allies to have forged documents on separate occasions in 2018 to unlawfully change the directors of Sinovac subsidiaries.
A regulator from the Peoples Republic of China found 1Globe and its allies to have forged documents on separate occasions in 2020 to unlawfully change the directors of Sinovac subsidiaries.

Stakeholder Impact

Shareholders: Positive impact for long-term shareholders like Vivo Capital and SAIF Partners due to the successful election of a new board and the court's ruling against misleading practices, potentially leading to restored trading and dividends. Negative impact for 1Globe Capital and its affiliates due to legal setbacks and loss of board control.
Management: The new board is expected to bring stability and a clear strategic direction, potentially improving operational efficiency and compliance.
Regulatory Authorities: The court's enforcement of disclosure obligations reinforces regulatory oversight and market integrity.

Next Steps

1Globe Capital and Jiaqiang Li are mandated to file an amended and accurate Schedule 13D disclosing their beneficial ownership interests, control relationships, group affiliations, and plans and proposals relating to Sinovac within five days of the court order.
The newly elected Board of Directors is expected to restore proper governance.
The company aims to retain a new auditor.
The company plans to accelerate the implementation of a legitimate, audited, and realistic dividend plan maximizing all shareholders' returns.
The company intends to get back on track towards restoring trading on the NASDAQ.
The company aims to end all cost-consuming shareholder disputes.
Reporting Persons will continue to seek to influence management or the Board of Directors with respect to the business and affairs of the Issuer.

Key Dates

Date	Description
2018	1Globe Capital involved relatives to discreetly build positions in Sinovac for advantage in the Annual General Meeting for Shareholders (AGM); 1Globe and allies found by High Court of Hong Kong to have forged documents.
2020	1Globe and allies found by a regulator from the Peoples Republic of China to have forged documents.
March 31, 2024	Date as of which 71,860,702 common shares of Sinovac were outstanding, as reported in the Issuer's Form 20-F.
April 29, 2024	Date Issuer's Form 20-F was filed with the SEC.
May 19, 2025	Issuer gave notice of a Special Meeting of Shareholders and announced intention to exclude shares held by Reporting Persons and another investor from the vote.
May 30, 2025	Issuer filed an application for an injunction in the High Court of Antigua and Barbuda seeking to prohibit Reporting Persons and another investor from voting their shares.
June 13, 2025	Amendment No. 5 to Schedule 13D was filed by Vivo Capital VIII, LLC and Vivo Capital IX, LLC.
June 30, 2025	Reporting Persons obtained an injunction from the United States District Court for the District of Massachusetts, compelling further disclosure from other Sinovac shareholders affiliated with Mr. Li.
July 2, 2025	Date of press release (Exhibit K) announcing the US District Court's injunction against 1Globe Capital.
July 8, 2025	Special Meeting of Shareholders held (Atlantic Standard Time); Court of Appeal of the Eastern Caribbean Supreme Court issued an order staying execution of an injunction from the High Court, allowing Vivo and Prime Success to vote; SAIF nominated slate, including Mr. Shan Fu, was elected to the Board of Directors.
July 9, 2025	Special Meeting of Shareholders held (China Standard Time); Date of press release (Exhibit L) announcing the Eastern Caribbean Supreme Court's decision.
July 10, 2025	Issuer disclosed that a new Board of Directors, consisting of the SAIF nominated slate, was elected at the Special Meeting.
July 11, 2025	Date of event which required the filing of this Schedule 13D Amendment No. 6.

Recommendation

buy

Keywords

Sinovac Biotech, Vivo Capital, 1Globe Capital, SEC filing, corporate governance, shareholder activism, injunction, NASDAQ, biotechnology, pharmaceuticals, healthcare investment, Schedule 13D, shareholder meeting, legal proceedings

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