Shareholder Voting Rights Generally

Quorum Lowest Possible

1/3 of shareholders

Hoschett v. TSI International Software, LTD

Rule: Written consent of majority shareholders does not eliminate the need to have an annual meeting

Limited voting rights

Shareholders vote at meetings, in person or by proxy 1. Annual meeting 2. Special meeting 3. Written Consent Typically: 1 share=1 vote

Special Meeting

a. DE says only directors or those listed in the certificate of incorporation can call special meetings b. Shareholders can't call special meeting §211(d) c. Usually used when Corp. needs to i. Amend Certificate of Incorporation ii. M&A

Institutional investors

get involved with corporate governance 1. Mutual funds - (Fidelity, Vanguard, TIAA_CREF, ect) 2. Private pension funds 3. Banks and life insurance companies 4. Sometimes definition includes: a. Hedge funds b. Private equity funds

Efficient Market Hypothesis (Weak Form)

i. Current market price is unbiased in that it incorporates the value of info from past prices and whatever causes the price to move tomorrow will be new information

Efficient Market Hypothesis (b. Semi-Strong form)

i. EMH - can't be market with public info

Efficient Market Hypothesis (Strong Form)

i. Emh even if you have inside new public info you can't beat market ii. No wide spread belief markets are strong form

Rational apathy

info too costly to justify so go along with management or sell

Annual Meeting

§211(b) Statutes provide summary judicial procedures to ensure that failure to hold meetings is remedied

Quorum Default

§216 - Default: a majority of shares entitled to vote, present in person or represented by proxy... is a quorum

Written Consent

§228 Allows action by written consent of an absolute majority of shareholders

Activist Shareholders

- Choose to get involved in corporate governance issues for political reasons