Sarbanes Oxley Act: Chapter 36 Flashcards
Do shareholders have the right to manage the corporate business?
No, directors do
Inside Directors
officers in the corporation, who will typically control their company’s board
Outside Directors
Independent Directors; do not work for the company and have traditionally played a lesser role
Do shareholders have the right to inspect and copy the corporation’s minute book, accounting records, and shareholder lists?
Under Model Act; if acting in good faith and with a proper purpose such as aiding themselves in managing and protecting her investment
How many classes of stock with voting rights must a corporation have?
one; common have right to vote, preferred do not generally
Proxy
(1) a person whom the shareholder designates to vote in his place (2) the written form (typically a card) that the shareholder uses to appoint a designated voter
Quorum
the number of voters that must be present for a meeting to count
Proxy Statement
When a public company seeks proxy votes from its shareholders, it must include a proxy statement. This statement contains information about the company, such as a detailed description of management compensation
Annual Report
Each year, public companies must send their shareholders an annual report that contains detailed financial data
How often do publicly traded companies have shareholder meetings?
Annually normally
Record Date
to vote at a shareholders meeting, a shareholder must own stock on the record date
Who has a great deal of influence over Executive’s pay?
Executives, Directors
Merger
an acquisition of one company by another
When are shareholders asked to approve sale of assets?
when sale involves “all or substantially all” of the company’s assets
voluntary vs involuntary dissolution
corporation cannot voluntarily dissolve without shareholder approval, state or a court can involuntarily dissolve it
