However, because a shareholder holds important stakes in the company, there are some similarities of obligations: If a shareholder violates or contributes to a violation of the law or articles of association, or causes the company, a third party, or another shareholder harm, they can be held liable for damages.
Right to inspect the books and records. Right to share in dividends if declared. Right to determine the mission of the corporation. Right to sue on behalf of the corporation if the officers and directors fail to uphold corporate rights. Correct - Your answer is correct. Wrong - Your answer is wrong.
Shareholders are generally not responsible for the corporation's debts and obligations, but in some cases, courts will pierce the corporate veil if a plaintiff sues the shareholder directly. The "alter ego theory" is invoked when arguing shareholders should be accountable for the corporation.
If a shareholder violates or contributes to a violation of the law or articles of association, or causes the company, a third party, or another shareholder harm, they can be held liable for damages.
Shareholder Obligations: Everything You Need to Know. 1. Personal Liability of Shareholders. 2. Derivative Suits. Shareholder obligations vary depending on the type of business and shares involved, the shareholder's agreements, and the company's articles of incorporation. Even the type of shareholder makes a difference.
If a shareholder violates or contributes to a violation of the law or articles of association, or causes the company, a third party, or another shareholder harm, they can be held liable for damages.
The main goal of corporate managers and directors is to build long-term shareholder wealth. The reason for this goal is to provide accountability to the managers. If these leaders were tasked with pursuing the interests of everyone in the company, no one's interests would be realized.
Since the independent counsel would still work for the corporation, which is controlled by the defendants, it would take orders from them, even if they weren't technically defending them. The result would be the same — the corporation's best interests would be ignored and legal counsel would still oppose the company.
Notice is also required if they obtain more shares that should be added to the shareholder register. If a shareholder controls more than nine-tenths of the company's shares and votes, they can redeem the rest of the minority shares. The main goal of corporate managers and directors is to build long-term shareholder wealth.
Personal Liability of Shareholders. Shareholders are generally not responsible for the corporation's debts and obligations, but in some cases, courts will pierce the corporate veil if a plaintiff sues the shareholder directly.