Rights of the Minority Stockholder

Paperback | January 7, 2012

byRichard Selden Harvey

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This historic book may have numerous typos, missing text, images, or index. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. 1909. Not illustrated. Excerpt: ... Where the managers of the subscription who ere the majority in control of the enterprise persuade persons to become members of the corporation by misleading statements contained in a prospectus and in/ a report upon the condition of the company, a court of equity will release a stockholder from any obligation to pay for stock subscribed for under these circumstances.9 To avail himself of this right, the stockholder must repudiate the contract promptly, after discovery of the deceit.10 Fraud Vitiates Subscription Contract Conditional Subscriptions. Sometimes the subscription is made conditional upon the performance of certain particulars on the part of the incorporators,11 or that certain things shall be done within a specified time, or to a given amount.12 In every contract of this description, the subscriber is released unless the conditions are complied with on the part of the corporation.13 Corpora- tion Must Comply With Terms Secret Agreements. The board of directors have no right by secret compact or otherwise to release those who stand in friendly relations from obligations to pay for Favoritism shares of capital stock.14 Such secret arrange- 1s Tinged ments are tinged with fraud,15 and unless rescinded Wltn Fraud will release the remaining subscribers; otherwise there would exist a state of preference which would leave all the risk of the enterprise to be borne by those who were not in the favored class. Other Individual Defenses. Equitable Principles Control Other defenses which the minority shareholder may interpose consist in showing to the court that the burden of the corporate debt has been increased without the consent of the stockholders,16 or that the entire capital stock has not been issued. Unless there is some provision in the statutes...

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This historic book may have numerous typos, missing text, images, or index. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. 1909. Not illustrated. Excerpt: ... Where the managers of the subscription who ere the majority in control of the enterprise persuade persons to become members ...

Format:PaperbackDimensions:52 pages, 9.69 × 7.44 × 0.11 inPublished:January 7, 2012Publisher:General Books LLCLanguage:English

The following ISBNs are associated with this title:

ISBN - 10:0217790550

ISBN - 13:9780217790550

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