A board of shareholders is consisted of all shareholders of a company. The purpose of shareholder resolutions is to manage the internal departments. A company limited by shares is required to hold a shareholder meeting once at least per year, which shall be held up within 6 months after the end of fiscal year. The shareholders can call a provisional shareholder meeting if necessary.
The resolutions of shareholder meeting are divided into ordinary resolution, special resolution, and tentative resolution. The total amount of issued shares, shareholder present, shareholders with voting rights are key to adopting a resolutions.
Ordinary resolution
A majority of the shareholders present who represent half or more of the total number of its outstanding shares to consent.
Special resolution
A majority of the shareholders present who represent two-thirds or more of the total number of its outstanding shares to consent.
Tentative resolution
When the number of shareholders present does not constitute the quorum prescribed in the preceding article, but those present represent one-third or more of the total number of issued shares, a tentative resolution may be passed by a majority of those present. A notice of such tentative resolution shall be given to each of the shareholders, and reconvene a Shareholders’ meeting within one month. Tentative resolution is only applicable to ordinary items as ordinary resolution. The adoptions by special resolutions are not allowed to apply to tentative resolution.
The total number of issued shares is in accordance with Taiwan's company law. Shares without voting rights will not be included in the total number of issued shares when resolutions are made at the shareholders' meeting. Even if the stock has been issued, but has no voting rights from the beginning, or has voting rights, but has been bought back by the company afterwards, or is held by a subsidiary company, and then becomes non-voting shares, it will no longer be included in the total number of issued shares .
Only when the number of shares attended at the shareholders meeting reaches the attendance threshold can it be judged whether the proposals are passed and become effective resolutions. Shareholder voting rights are the key. The following situations are issued shares, but cannot be included in the number of voting rights:
Special shares with restricted voting rights.
Shareholding by shareholders who have an interest in the matters to be resolved.
Proxy shareholders who are oversubscribed. When it is not a stock affairs agency but entrusted by other shareholders to exercise voting rights, the shareholder can only exercise a maximum of 3% of the total number of issued shares, and the excess part will not be counted in the number of voting rights.
Proxy shareholders who violate the rules on the use of power of attorney.
Shareholding of companies investing in each other.
When deciding whether to split or merge, the shareholders who request the purchasing shareholders to hold the shares.
Shareholdings of directors with pledged rights.
The shareholders' meeting is a necessary existence for a company limited by shares. It can not only convey the shareholder resolution, but also the company can express its future outline through the shareholders meeting, but the annual shareholders meeting also causes a lot of disputes. Kaizen suggests that it is necessary to have more insights about the relevant regulations of the shareholders' meeting to protect the rights of shareholders. Minority shareholders can also exercise their shareholders' rights by participating in the shareholders' meeting and make decisions for the company's future.
Disclaimer
All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.
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