Wendy's BOrgs Outline Spring

Wendy's BOrgs Outline Spring - Biz Orgs Outline Is there a...

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Biz Orgs Outline p 1 of 5 Is there a SHR rights/proxy rights issue? (§12 rules) SHAREHOLDER RIGHTS AND PROXY PROCESS SHAREHOLDER INFORMATION RIGHTS - SHR demand to inspect corp records C/L: π/SHR must show a Proper Purpose , one germane to π’s interest as a SHR, UNLESS (under the S TATUTORY system) it is SHR listings or stock ledgers--which are automatically proper (to determine financial condition and value of SHR’s shares) Burden then shifts to Δ to show π’s purpose is IM proper π retains burden on all other documents FOR TEST : “Here, there was (not) a proper purpose because the π believes [xxxx] and requested [yyyy], which does (not) relate to π’s interest as a SHR. A single proper purpose is okay, and a secondary improper purpose is irrelevant S TATUTORY : supplements C/L and usually have duration/%-ownership requirements, and the court may impose restrictions REGISTERED UNDER §12 - [SEC Rule 12(a)] it is unlawful for a member/broker/dealer to trade securities on a national exchange w/o effective SEC registration A corp is required to register with the SEC if it: has an Interstate Commerce connection: issuer engages in IC, in a business affecting IC, or securities are traded by mail or means / instrumentality of IC Any indication is acceptable: phone calls, shipping out of state FOR TEST : “Here, [X] has an interstate commerce connection because [X] engages in [interstate commerce connection activity].” AND EITHER: has 500 SHRs FOR TEST : “Here, [X] has ≥500 SHRs because the facts state that [X] has [###] SHRs and [###] is ≥ 500.” has net assets >$10M FOR TEST : “Here, [X] has net assets >$10M because the facts state that [X]’s assets are [$$$$] and that is >$10M.” OR registered w/ a national exchange FOR TEST : “Here, [X] is registered w/ a national exchange because the facts state that [X]’s stock is traded on the [exchange].” SHAREHOLDER PROPOSALS - [SEC Rule 14a] A corp required to register under §12 must include a SHR proposal at corp expense if it is P ROPER SHR must hold $2K or 1% for 1 year, and SHR must continue to hold it until meeting where proposal is considered UNLESS some exception in the rule applies: • Corp may exclude SHR proposals related to ordinary business operations--does not implicate S IGNIFICANT P OLICY I SSUES (SPI) May not exclude if extraordinary decisions or matters made important by public or govt’l interest • Corp may omit SHR proposal if relates to <5% of total assets AND does not otherwise significantly relate to the business. A corp must get SEC okay to exclude a SHR proposal, after stating why; if SEC says “No,” corp’s excluding anyway is at corp’s own risk. MISLEADING PROXY STATEMENTS
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Wendy's BOrgs Outline Spring - Biz Orgs Outline Is there a...

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