SHAREHOLDERS' CLASS RIGHTS

Shareholders' Class Rights

Shareholders' Class Rights

Introduction

A shareholder is entitled to participate in the operation of the ordinary and extraordinary. According to the provisions of article 349 of the Commercial Companies Law No. 16,060 of 1989 (LSC), there are also special meetings at which only holders participate in certain classes or series of shares. The shareholders of a corporation have two kinds of rights exercised through their actions and are: Economic Rights: You have the right to their share of the profits that the company obtained, which will be proportional to the amount of their contribution. They have rights to participate in the final instalment of liquidation, if the company is dissolved. Corporate rights: Shareholders have the right to participate in decision-making in society by voting, in proportion to its shareholding and the type of share held.

Discussion

The actions can be classified taking into account the following criteria: i. rights conferred by the shareholders; ii. for its transmission. There are several advantages to the creation of A and B shares in your company. One is that you get complete control over the amount and timing of dividend payments to shareholders. You can also set independently of the rights of each class of shareholders can limit or deny deliberative; increase or limit the right to a return of capital on liquidation, and give some shareholders a priority return of capital at the expense of others. If you see more sophisticated trainers, you will be able to form a company with multiple classes of shares. The name you give to a class of shares may be misleading because it does not necessarily describe accurately the rights attached to the relevant shares.

Shareholder is an individual or legal entity that owns shares of various types of limited liability companies or limited partnerships that can exist in the legal framework of each country. The shareholder is an equity partner that participates in the management of the company in the same measure that provides capital to it. Therefore, within the society have more votes who own more shares.Being a corporation, there may be a large number of shareholders who do not necessarily participate in the management of the company, and whose interest is only receiving a dividend payment in exchange for their investment. However, the shareholders themselves are interested in your development. For the same reason, a shareholder is a venture capitalist who engages in the management of the company. Your responsibility and decision-making depends on the percentage of capital that contributes to it (more actions, more votes).It is important to further establish that there are two distinct types of shareholders. Thus, first, we find the so-called shareholders, which are those that are characterized by the fact that they have a substantial number of shares that is what determines and makes clear to intervene and influence what is the management of the company itself.

Second, the so-called minority shareholders have few shares and therefore have no ability to influence what is the direction and management of the company ...