Company Law

Whether a C corporation that has preferred stock and common stock with both voting and nonvoting rights, eight shareholders among whom there are a Swedish individual and Plantation Sugar partnership, may elect to be an S corporation, under section 1361(b)(1)(B), 1361(b)(1)(C) and 1361(b)(1)(D)?

In corporations, issuing new shares belongs to the Board 's power. It is the management issue that cannot be inferred by members: RR s 198A. Therefore, Hearts and Flowers Pty Ltd can issue a new class of ordinary shares in company to for fundraising. However, the new shares are attached with doubled voting rights than the existing shares, which means there is a variation of class rights. Generally, when it comes to a variation of class right, corporations would apply with s 246C of Corporation Act, yet, if the company has a constitution that sets out the procedure for varying or cancelling rights, the procedure must be complied with: s 246B(1). This illustrates that the constitution 1 of Hearts must be followed. Therefore, the variation of class right must be approved by the ordinary resolution with above 50% votes of the company as a whole.

Rule 23.1 governs derivative suits in which a plaintiff seeks to assert a right belonging to a corporation (or similar entity) in which the plaintiff is a shareholder, on behalf of the corporation that is not pursuing the claim itself. Rule 23.2 governs actions by or against unincorporated associations (Rule 23, 2009).

may exercise their voting rights with respect to the registrant. The special voting stock and the registrant’s common stock generally vote together as a single class on all matters on which the common stock is entitled to vote.

|owned normally count for one vote. If share holders band together that chances of a proposal they agree with passing a the vote is much |

5. A company had outstanding 80,000 shares of $10 par value common stock. During the

The majority of share divisions are mostly two for one split. This implies the stockholders get two stocks and shares for the price of one share. In case the share cost $10, the stockholder will get 2 $5 shares instead.

Learning Objective 1.2 ~ discuss the different types of companies which may be formed under the Corporations Act 2001

S254D(1) CA: In a proprietary company, before issuing shares of a particular class, the director must offer them to the existing holders of shares of that class. As far as practicable, the number of shares offered to each shareholder must be in proportion to the number of shares of that class that they already hold.

It is traditional to start considering the scope of the rule by reference to Buckley J's observation in Re Duomatic Ltd , ‘where all shareholders who have a right to attend and vote at a general meeting of the company assent to some matter which a general meeting of the company could carry into effect, that assent is as binding as a resolution in general meeting would be'. Undoubtedly, the rule is a doctrine of wide application, however, it must not be regarded as a cure for any failure to observe

2) Up to six generations of a family are considered as one shareholder for purposes of the 100-shareholder limit.

First and foremost, Apex must insist on the right to elect one director to the board. Series A investors already have one seat, and the current voting clauses allow Series A to effectively retain control of decision making by requiring 2/3rds majority for many key decisions. Should future funding rounds be required, those investors may insist on seats on the board.

These actions allowed the board of directors and management to amend the company’s charter and allowed shareholders four votes per share. The board of directors was also re-structured into classes, in which each class serves staggered three-year terms (Wheelen & Hunger).

“A proper balance of the rights of majority and minority shareholders is essential for the smooth functioning of the company.”- Explain & Illustrate? 1. Introduction:

The protections under the Corporations Act suffice to guard the minority from the majority’s unfair wrongdoing. In fact, the Australian corporate law provides significant protections on shareholders. To support the argument, this essay discusses Foss v Harbottle rule and derivative action. It also elaborates exceptions to the rule, especially ‘fraud on the minority’ and statutory protections available for the minority protection under the Corporations Act. These are analysed in views of organic theory, economic theory and aggregate theory. It concludes with that specific protections for the minority are unnecessary because these may lose the balance of a corporation and the minority and majority members.