Fundamental Corporate Changes

Question 1

Approval

Answer 1

To approve a fundamental corporate change, the shareholders must approve by a majority of those entitled to vote.

Question 2

Close Corporations Right of Appraisal

Answer 2

CLOSE CORPS ONLY – This change triggers a right of appraisal. The shareholder must file a written objection to the proposal and abstain from the vote or vote against the change. If the change is approved, the corporation must notify the dissenting shareholders within 10 days. Subsequently, the shareholders must make a written demand to be bought out and the corporation must pay the fair value of the shares plus accrued interest.