Explore tens of thousands of sets crafted by our community.
Shareholder Rights and Actions
25
Flashcards
0/25
Right to Dividends
Shareholders are entitled to a portion of the company's profits in the form of dividends, if and when they are declared by the board of directors.
Right to Sue for Wrongdoing
Shareholders can initiate legal action such as derivative suits against the company's management for acts of wrongdoing or negligence.
Action: Shareholder Activism
Shareholders can exercise shareholder activism to influence company policy and decisions, using their stake in the company as leverage.
Action: Oppression Remedies
Minority shareholders can seek oppression remedies when their rights are violated by the actions of the majority or the company's management.
Right to Share in Liquidation Proceeds
In the event of company liquidation, shareholders have the right to share in the proceeds after creditors are paid, according to their share class and ownership percentage.
Action: Calling a Special Meeting
Shareholders can call for a special meeting, often requiring a significant percentage of shares to do so, to address urgent company matters.
Action: Tender Offers
Shareholders can respond to tender offers, which are proposals to purchase their shares usually at a premium over the current market price.
Right to a Fair Price
In buyouts, shareholders have the right to receive a fair price for their shares, based on fair market value assessments and regulations.
Action: Shareholder Proposals
Shareholders can introduce proposals for shareholder meetings, typically needing to meet certain ownership thresholds and follow formal submission processes.
Right to Information
Shareholders have the right to receive material information about the company, including financial statements, annual reports, and notices of meetings.
Action: Proxy Battles
Shareholders can engage in proxy battles to win control of the board by persuading other shareholders to vote their shares in a particular way.
Action: Class Action Lawsuits
Shareholders can participate in class action lawsuits if they have suffered a common harm, providing collective legal action against the company.
Right to Nominate Directors
Shareholders can nominate individuals to the company's board of directors, usually subject to certain nominating procedures and ownership requirements.
Preemptive Rights
Shareholders have the right to purchase additional shares before the company offers them to the public, to maintain their proportional ownership.
Action: Dissenter's Rights
In certain transactions, shareholders who do not agree may have dissenter's rights to demand that the company buy back their shares at a fair price.
Right to an Annual Meeting
Shareholders have the right to have an annual meeting conducted by the company, which is a forum to exercise many of their rights.
Right to Challenge Transactions
Shareholders have the ability to challenge transactions that may affect their interests, such as mergers or acquisitions, through legal means.
Right to a Stock Certificate
Shareholders have the right to a physical or electronic certificate evidencing ownership of their shares within the company.
Right to Vote
Shareholders have the right to vote on company decisions and the election of board members, typically exercised during annual general meetings or special meetings.
Action: Voting Trust Agreements
Shareholders can create voting trusts by transferring their shares to a trustee to combine voting power, typically for a specific period or purpose.
Right to Attend Meetings
Shareholders have the right to attend annual and special meetings to discuss and vote on company affairs, often via proxy if they cannot attend in person.
Right to Elect Directors
Shareholders can vote to elect the company's board of directors, who will act in the best interests of the shareholders and the company.
Action: Proxy Voting
Shareholders can vote through a proxy to delegate their voting power to someone else, allowing them to participate indirectly in corporate decisions.
Right to Inspect Books and Records
Shareholders have the right to access and inspect the company's books and records to ensure transparency and accountability.
Right to Sell Shares
Shareholders have the right to sell their shares to others, subject to any restrictions in the shareholder agreement or company bylaws.
© Hypatia.Tech. 2024 All rights reserved.