Someone recently bought our

students are currently browsing our notes.

X

Minority Shareholders Notes

LPC Law Notes > Business Law and Practice Notes

This is an extract of our Minority Shareholders document, which we sell as part of our Business Law and Practice Notes collection written by the top tier of Cambridge And Oxilp And College Of Law students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Business Law and Practice Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Minority shareholders

1) Actions by minority shareholders exercising their voting rights

What is the capacity of the minority shareholders?

Voting on a show of hands

Shareholder only

Will only be able to exercise power at general meetings

Directors and shareholders

Will be able to exercise power at both general meetings and board meetings

What is their voting power as minority shareholders together on a show of hands?

2 votes out of 10

4 votes out of 10

Could the minority shareholders block resolutions at general meetings on a show of hands?

If have 50% or over on show of hands can block ordinary resolution

If have over 26% or over on show of hands can block a special resolution

Right to demand a poll Model Article 44 and s.321(2)(b)

Voting on a poll

What is their voting power as m minority shareholders together on a poll?

Below 25%

Above 25%

Could the minority shareholders block resolutions at general meetings on a poll?

If have 50% or over on show of hands can block ordinary resolution

If have over 26% or over on show of hands can block a special resolution

Apply to the facts of the question. Which proposed resolutions, transactions or meeting notices can the minority shareholders block?

*

*

e.g. Block special resolution to amend articles of association e.g. Stop general meetings being held on short notice

2) Shareholder membership rights - s.33 CA 2006

What action can a shareholder pursue / what is this action?

Can sue for damages under s.33 CA if their membership rights have been infringed

What are membership rights?
(examples)

1) Right to a dividend once it has been lawfully declared

2) Right to share in surplus capital on winding up

3) Right to receive notice of general meetings

4) Right to vote at general meetings

What type of rights are these?

1) These are rights which govern the business relationship between the company and the shareholder

2) Personal rights are unenforceable

*
Ely v Positive Government Life Assurance - A right to be the company's solicitor was unenforceable through s.33 as it was not a membership right

Where should non-membership rights be recorded?

In a separate contract / shareholders agreement and not in the articles of association

Buy the full version of these notes or essay plans and more in our Business Law and Practice Notes.

More Business Law And Practice Samples