Shareholder oppression occurs when majority shareholders abuse their power to harm minority shareholders, often in closely held companies. Legal remedies can be sought in court, including mandatory dissolution or sale of shares to create a more equitable situation. Shareholder oppression is an abuse of power by majority shareholders in a company that harms minority shareholders […]
S-corp shareholders receive periodic distributions of income and must pay taxes on it, as well as Social Security and Medicare taxes. They may also receive additional benefits with tax incentives. Shareholders should make quarterly estimated tax payments to avoid penalties. The corporation must have fewer than 100 shareholders, and each shareholder-employee receives a “reasonable” salary. […]
S-corp shareholders receive periodic distributions of income and must pay taxes on it, as well as Social Security and Medicare taxes. They may also receive additional benefits with tax incentives. Shareholders must make quarterly estimated tax payments to avoid penalties, and must receive a “reasonable” salary. Even if income is not distributed, there is still […]
Shareholder funds are funds invested in a company through stock purchases or private investments, reported on the balance sheet. Publicly traded companies use shareholder funds to raise capital, with preferred shareholders receiving dividends and common shareholders having voting rights. Shareholder funds are a type of outside capital used to pay for large expenses without using […]
A nominee shareholder holds shares on behalf of the beneficial owner, allowing for anonymity in ownership. The scope of powers is determined by a confidentiality agreement, but disclosure may be ordered by legal authorities in some countries. Sometimes referred to as a nominee shareholder, a nominee shareholder is an individual or entity who is granted […]
Shareholder analysis is a review of individuals and groups that own shares in a company, including financial and qualitative information. It helps companies understand their investors and potential conflicts of interest, as well as the impact of new stock issues on current shareholders. Shareholder analysis is a review function that public companies perform to discover […]
Preferred shareholders seek stability through consistent dividend payments and certain privileges, and are protected in the event of bankruptcy. They receive ongoing dividend payments, but these are not guaranteed. Preferred stock values fluctuate less than common stock and do not have voting rights. A preferred shareholder is an investor who seeks to benefit from an […]
Board members have a fiduciary duty to protect shareholder investment, with shareholder wealth determined by the company’s value per share and number of shares issued. Strategic decisions may temporarily reduce shareholder wealth, but bad trading decisions can be cause for concern. Shareholder wealth maximization is a priority, but board members must balance conflicting needs. Shareholder […]
Minority shareholder rights are the legal and moral rights of private shareholders, and involve recognition of their stake in the company. Majority shareholders must act in the best interest of the company, and minority shareholders have the right to inspect relevant company documentation. These principles apply to both private and publicly traded companies, but may […]
A majority shareholder owns over 50% of a company’s shares and wields substantial power, but must exercise caution to avoid disadvantaging minority shareholders. Laws protect minority shareholders and the majority shareholder must not manipulate their authority for personal gain. Voting rights may also negate some of the power of the majority shareholder. Shareholders are people […]
A shareholder loan is a loan agreement between a company and an investor, typically used for financing company projects in exchange for interest payments. It is common for new businesses with positive cash flow, and can have deferred interest payments and a longer payback period. It may also have subordinated loan status, requiring guarantees for […]
A shareholder register contains information on investors who own shares in a company, including their names, addresses, and the number and type of shares owned. Access to the register is limited and national laws often restrict the scope of data that can be obtained from it. A shareholder register is a list of investors who […]
Shareholders who own more than $2,000 in shares for a year can file a resolution and vote on proposals. Shareholder activism can lead to corporate change, particularly in environmental issues, but may require media support. Shareholders should ensure they receive and complete their proxy ballots. People who own corporate stock often have the right to […]
A general meeting is held annually for shareholders to vote on key issues such as the company’s direction and financial results. Shareholders can appoint a proxy to vote on their behalf, and a quorum must be present for an item to pass. Minority shareholders can have a significant impact through active participation. A general meeting […]
S-corp shareholders receive periodic income distributions and may receive tax-incentivized fringe benefits. Shareholders must make quarterly estimated tax payments and receive a “reasonable” salary. They are subject to tax liability for salary income and company earnings. Shareholders must vote on company matters and review issues before voting. An S-corp shareholder can expect periodic distributions of […]
Shareholder value added (SVA) measures a company’s value to shareholders by subtracting the cost of capital from net operating profit after tax (NOPAT). It is just one way to assess a company’s potential to compensate investors. Other measures include market value-added (MVA) and weighted average cost of capital (WACC). These tools help investors make informed […]
A shareholder proxy is a form used to assign voting rights when a shareholder is unable to attend a meeting. The form should include the company name, effective dates, proxy name, and nomination of the proxy. It must be signed in front of a witness and notarized. If the company does not provide a form, […]
