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Questions tagged [shareholders]

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Must a for-profit corporation use share-based ownership?

Generally, corporations are structured so that ownership is represented by shares, and a person can own any number of shares. Is this structure required by law? Or can corporations be created that use ...
interfect's user avatar
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25 votes
2 answers
7k views

What's the legal basis for a judge voiding Elon Musk's pay package?

Recently a judge in Delaware voided Elon Musk's contracted pay package with Tesla. Here's a sample story about it: CNBC - Elon Musk’s $56 billion Tesla compensation voided by judge, shares slide And ...
Kyralessa's user avatar
  • 587
4 votes
3 answers
103 views

Duty to disclose to shareholder vs. confidential information

I was talking with friends about Apple switching from Intel CPUs to their own, and an interesting question popped up. Since we're not privy to any of the details, this is purely speculative and out of ...
Thomas's user avatar
  • 523
4 votes
1 answer
102 views

Are businesses required to let all shareholders attend their offline shareholder meetings?

Cover Corporation is a Japanese media company managing content creators which is listed on the Tokyo Stock Exchange as of March 27, 2023. They held a shareholder meeting at June 29th, 2023. It was ...
mkm49573's user avatar
-1 votes
1 answer
70 views

Who are the shareholders/owners/beneficiaries of the private component/aspect of the City of London Corporation?

Insofar as some parts of it (so called "City's Cash") function as a private entity from monies "built up over the centuries" to such extent as to make it exempt from the Freedom of ...
TylerDurden's user avatar
0 votes
3 answers
364 views

If a business partner did not put money into the founding of the company are they still entitled to their shares?

Consider the scenario in Western Australia: Me and 2 others want to go into business together based on what we believe will make us profit (etc.). The decision is to form a company, however, due to ...
Hendrix13's user avatar
  • 101
1 vote
1 answer
87 views

As an investor of a business, how do you prevent the founder from holding back growth?

If you are an investor who owns 30% of a business and the founder owns 70%, how do you prevent a situation where the founder decides to always take profits and not reinvest them to grow the business? ...
Rax Weber's user avatar
  • 111
1 vote
1 answer
62 views

Is it normal to reverse transfer ownership during a funding round? [closed]

Delaware Corp (for jurisdiction) Got involved in an unfunded startup last year and we managed to strike pay dirt. I'm the engineering side of the equation. Got a request to return some of my shares ...
boatcoder's user avatar
  • 231
0 votes
1 answer
34 views

Does a UK private company need a privacy notice to store shareholders' personal data?

I'm the co-founder of a UK-based startup, and we're on the cusp of raising a seed round from a number of angel investors, the majority of whom will invest as private persons. Our lawyers advised us to ...
Paul Razvan Berg's user avatar
0 votes
1 answer
78 views

Is it legal for a shareholder who receives no wages from company A to receive a reimbursement for business travel costs from company A?

Is it legal for a shareholder who receives no wages from company A to receive a reimbursement for business travel costs from company A in United States? Shareholder pocketed zero dollars of the ...
user avatar
0 votes
1 answer
76 views

A departing director wants to convert his directors loan and owed salary into shares. How do we value the shares, and what are we obliged to pay?

We are raising investment with individual shares valued at £5. A founder & director is leaving the company and claiming owed salary and directors' loans need to be paid or converted to shares. We ...
Johnny 's user avatar
1 vote
1 answer
112 views

Can U.S. companies legally document stock buybacks as assets?

In the U.S., Jack creates a C-corporation and funds it with $100, receiving 100 shares in return. Greg, a passive investor, then gives the company $900 in exchange for 900 newly issued shares. The ...
SapereAude's user avatar
1 vote
1 answer
51 views

inheriting a share in a limited company: at what point do the rights from the share pass if membership consent has not yet been obtained?

I would like to know which laws regulate inheritance of shares in LLC and whether there are any difficulties with the moment of transfer of rights from the share, if the heir has inherited a share, ...
Ekaterina B.'s user avatar
1 vote
0 answers
57 views

Is an LLC Membership Certificate Legally Binding?

I'm wondering if an LLC Membership Certificate that has been signed by the owner of the company and promises a certain amount of stake in the LLC is legally binding/would hold up in court if there was ...
Evan's user avatar
  • 111
2 votes
3 answers
120 views

What are the simplest ways to gain a Property/Proprietary Interest in equity shares held by a defendant?

I don't understand how someone can have "a property interest that is not a security interest". I'm assuming the example below, of a claimant havinmg "a priorietary interest in shares ...
user avatar
1 vote
3 answers
153 views

What is preferential distribution?

It was written in this answer: There may be different classes of shares in a company with different rights (voting, dividends, preferential distribution etc.) In shareholding law, what is ...
al-harumi-jidan's user avatar
1 vote
1 answer
249 views

Can there be a company shareholder which is not a company owner?

I would define a shareholder as someone who is eligible for a certain percentile amount of profit from a company, from dividends and/or from selling the company; this person may or may not be an owner ...
al-harumi-jidan's user avatar
3 votes
1 answer
183 views

Who owns the company before the founders' shares vest (HBO's Silicon Valley plot point)?

In the HBO show Silicon Valley, an important plot point is when one investor fires the founder/CEO against everyone's objections. Originally, the founder gave 10% of the company to investor A (a ...
MWB's user avatar
  • 1,294
0 votes
1 answer
577 views

Can board members have unequal voting rights at a for-profit corporation in California?

California requires multiple board members when there are multiple shareholders. With equal voting rights, this can allow a minority shareholder, who is a board member, to have a disproportional ...
MWB's user avatar
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0 votes
1 answer
51 views

shareholders agreement with impossible to meet obligation

in shareholders agreement it says person X would do something by Jan 1. the contract wasnt signed and ascended until feb 1 at which time the person still hadnt done the thing. is person X in breach or ...
Johny's user avatar
  • 1
2 votes
2 answers
140 views

Can a company control who its shareholders are?

The current owners of a privately held company can decide who to sell the business to. (For example, a startup can choose which VC firms to raise from.) But what about a publicly-traded company? Can ...
Betterthan Kwora's user avatar
0 votes
2 answers
89 views

Do Revenue Sharing Agreements Carry on when the company is sold?

I've had an agreement with the Virginia company I work for to receive 1% of the generated revenue on a monthly basis. Of course that was after a long time of me being with the company (the bulk of my ...
yazanpro's user avatar
  • 109
0 votes
1 answer
75 views

Can Company Profits Be Split Equally Amongst Two Partners With Different Shares?

I intend to create an 'inc.' moral entity in Quebec, Canada (corporation). Can I own 75% of the shares while splitting profit 50/50 with my partner? (In a legally binding manner)
ursulet's user avatar
  • 27
0 votes
2 answers
119 views

How can i protect my self from contract termination in Germany?

I was offered a job position in Germany, this contract gives me the right to buy shares in the company (GmbH) after working for 4 years in this position. As I understood if I quit or my employer ends ...
user35400's user avatar
2 votes
2 answers
124 views

Can a plaintiff in a fiduciary breach of trust sue a particular director instead of the company?

I heard this story from Peter (not actual name): Peter co-founded a company with John. John earns 80% of shares while Peter owns 20% of shares. John being greedy empties all company coffers ...
user1034912's user avatar
  • 1,501
1 vote
1 answer
48 views

Appraisal Rights in Chapter 11?

Assuming some number of shareholders believe that the bankruptcy process is inadequately compensating them (i.e. by setting the company valuation too low and thus giving creditors too much equity in a ...
Hellawyer's user avatar
0 votes
2 answers
61 views

Audio Recordings as Evidence

I have many a times seen people deal with their Stock Brokers telling them to sell or buy shares and as the prices fluctuate quite quickly they don't have the time to get everything in writing. I once ...
FoundABetterName's user avatar
2 votes
1 answer
290 views

By what mechanism does a parent company control its subsidiary?

Company B is a fully-owned subsidiary of Company A, a huge international conglomerate. All the employees of Company B are in the orgchart of Company A, all under Company B's CEO. That CEO's boss is a ...
Ram Rachum's user avatar
0 votes
1 answer
181 views

What is the effective date of a new shareholder?

Suppose a soon to be shareholder (New Shareholder) subscribes to become a shareholder of an LLC (Company A) on 1 November 2000 through a subscription letter. New Shareholder transfer cash to the ...
indivisible.invisible.indivi..'s user avatar
0 votes
3 answers
186 views

How exactly is founder stock created?

Suppose that I found a C corporation, Superlative Widgets Inc., within the U.S. I would like to both fund the corporation and issue myself 100,000 shares in a way that avoids or minimizes my personal ...
SapereAude's user avatar
0 votes
4 answers
268 views

How can I protect myself as a minority shareholder when I don't have the money to pay legal fees?

I'm about to sell shares to an angel who is going to become the majority shareholder of my company. The money will go into the company as new shares. I can only pocket it through salary agreements. ...
user1034912's user avatar
  • 1,501
-1 votes
2 answers
182 views

How did facebook got away from fiduciary lawsuit when they diluted Saverin's shares?

Saverin eventually settled out of the court, for 5% equity. But why didn't he proceed for his original 30% equity when it was clear that facebooks majority shareholders failed to exercise the ...
user1034912's user avatar
  • 1,501
0 votes
1 answer
308 views

How would a minority share holder VETO power be provisioned in a company constitution?

To protect minority shareholder and potentially attract investors, a company would give minority shareholders the power to veto certain decisions. Typically decisions that would erode their ...
user1034912's user avatar
  • 1,501
0 votes
1 answer
191 views

Is it lawful for my old company to buy back all my shares today but pay me over the course of several years?

Brief context is that I quit a startup with some vested shares (not options) that I have already paid taxes for. Their attorney is arguing that the shareholder's agreement allows them to buy back all ...
kane's user avatar
  • 109
0 votes
2 answers
190 views

Does company have the right to purchase my vested shares after I quit?

Here's some context in case it's relevant. I worked at a startup which issued shares (not options) to employees. A good chunk of my shares have vested over the 4-year vesting period. I have ...
kane's user avatar
  • 109
2 votes
0 answers
60 views

Why is it legal to look at pending stock orders for some participants

another question indicates that market participants can take a look at the orders for a stock, option or futures. An ordinary investor can only look at the BID and ASK, but not the entire series of ...
puzzled's user avatar
  • 341
0 votes
2 answers
191 views

Is it advisable for a person write his own contract if he is good in english but don't know legal jargon?

A lawyer scared me by saying, yes you can right your own contract but chances are most of your clauses won't hold in court cause you don't know legal jargon. However, I know english and my english is ...
Anthony's user avatar
  • 629
0 votes
1 answer
90 views

Who approves the creation of new shares in a Proprietary Limited Company?

I'm struggling to find a concrete answer for this. Who approves the creation of new shares in a Proprietary Limited Company? Is it the Board of Directors (through board resolution), or Shareholders (...
Anthony's user avatar
  • 629
2 votes
2 answers
56 views

What does 'The Company' refer to in this proprietary ltmited company constitution?

I'm trying to understand who has the right to issue new shares in my proprietary limited company (wherther through board or general resolution). I found the following clause in the constitution: ...
Anthony's user avatar
  • 629
32 votes
1 answer
6k views

What's the difference between a share and a stock?

In my company constitution I found the following: At any time, the directors may allot and issue unissued shares subject to clause 8, or grant options over unissued shares, on any condition and ...
Anthony's user avatar
  • 629
1 vote
2 answers
156 views

Can a private company board of directors issue new shares?

If so, wouldn't this be unfair against shareholders as this would devalue their shares and voting rights?
Anthony's user avatar
  • 629
3 votes
1 answer
65 views

Where are Share Classes defined in an LLC?

Where are Share Classes defined in an LLC. For example, if I look at facebook's constitution at the link below, there are no definitions for share classes. I was thinking there would have been such a ...
Anthony's user avatar
  • 629
2 votes
1 answer
9k views

What's the difference between Ordinary, Class A and Class B Shares?

I incorporated my company using an Online service. Not knowingly, I created class A, B and Ordinary shares during the incroporation. However, in the company constitution there are no mention of what ...
user1034912's user avatar
  • 1,501
0 votes
1 answer
33 views

Loan conversion in company shares

We have a small business with the following situation: 3 partners with the following share distribution: 10%, 45%, 45%. One of the 45% partners has made €75k loan to the company which is convertible ...
Thomas's user avatar
  • 523
7 votes
1 answer
3k views

Does a shareholder of a company also have copyright rights?

If I buy, say, a share in The Walt Disney Company, does that give me part ownership in the intellectual property? Does this ownership then give me the right to copy it?
danuker's user avatar
  • 163
4 votes
1 answer
791 views

Where is the legal responsibility to maximise shareholder value stated in UK company law?

I can not find where in the model articles for UK companies it says the responsibility of the directors is to maximise shareholder value. https://www.gov.uk/government/publications/model-articles-for-...
AJP's user avatar
  • 163
2 votes
1 answer
140 views

Do I have to formally accept a transfer of shares to me, in the UK? Or can they be transferred to me without my consent?

I have become estranged from my business partners. One of them insists that I am owed shares in the company, but I don't wish to accept them, not least for reason that I believe the shares to be ...
Thomas Browne's user avatar
0 votes
1 answer
150 views

Can a company refuse service to a share holder?

Assume a large public company. Would the director, or majority share holders of a company be able to legally refuse service to a share holder (on non protected-class grounds)? Would the quantity of ...
19172281's user avatar
  • 101
0 votes
2 answers
180 views

'payable in like kind'? 'non-electing' shares?

each share of Series B Preferred Stock shall, by virtue of such transaction and on the same terms as apply to the holders of Common Stock, be converted into or exchanged for the aggregate amount ...
Jawad's user avatar
  • 113
1 vote
1 answer
65 views

interpretation of an article

The term "Common Stock" as used in this Appendix B means the Company's Common Stock without par value, as the same exists at the date of filing of the Amendment to the Company's Amended Articles ...
Jawad's user avatar
  • 113