Shareholder Rights Flashcards
What are the three ways a person can become a stockholder?
- Contract of subscription with the
corporation; - Purchase of treasury shares from the
corporation; and - Purchase or acquisition of shares from
existing stockholders.
The authority given by the stockholder or member to another to vote for him at a stockholders‘ or members‘ meeting
Proxy
A VTA cannot exceed for a period of?
5 years
An agreement whereby one or more stockholders of a stock corporation may create a voting trust for the purpose of conferring upon a trustee or trustees the right to vote and other rights pertaining to the shares
Voting Trust Agreement (VTA)
True or False: A proxy can only vote on the specified meeting(s)
True
True or False: All shareholder rights are given to the trustee of a VTA except for the actual onwership of the stock
True (They even earn dividends and can use appraisal right)
True or False: Both proxy and VTA are irrevocable
False (Proxies are revocable while VTA is irrevocable)
True or False: A VTA must be notarized
True
True or False: A proxy can exercise Appraisal Rights
False
It is the right of a stockholder who dissents from certain corporate actions to demand payment of the fair value of his or her shares.
Appraisal Right
True or False: All rights accruing to the dissenting stockholder‘s shares, including voting and dividend rights, shall be suspended, except the right of such stockholder to receive payment of the fair value thereof
True
True or False: The right of appraisal is embedded in the stock certificate
True
True or False: Subscribers can exercise Appraisal Right
False
It is the preferential right granted to all stockholders of a corporation to subscribe to all issues or disposition of shares of any class, in proportion to their respective shareholdings
Pre-emptive Right
What documents can the shareholders inspect?
- Business Transactions
- FS
- Stock and Transfer Book
- Minutes of the Meeting
It is the right granted to stockholders of
existing corporations to buy the shares
of stock of another stockholder at a fixed
price and only valid if made on
reasonable terms and consideration
Right of first refusal
Who has the right to inspect?
Directors, trustees, shareholders, or members of the corporation
Where can the shareholders inspect the corporate records?
At the principal office
When can the shareholders inspect the corporat records?
During Business days and hours, 8am to 5pm
True or False: Treasury shares must be sold as the original type of share it was issued (Ex: A preferred share will always be a preferred share even when resold as a treasury share)
True
True or False: The shareholder must make a written demand for 30 days for his/her appraisal right to be valid
True
True or False: The dissenting shareholder does not need to surrender the stock certificate when demanding for his/her Appraisal Right
False (must surrender withing 1- days after demand)
How many days does the corporation have to pay the FV of the dissenting shareholders’ shares?
30 days
True or False: URE is needed before a corporation can pay the dissenting shareholder
True
