If a preferential shareholder dies, will the heir according to that shareholder’s will automatically become a shareholder of the company?

How are preferred shareholders classified?

In Article 114 of the Law on Enterprises 2020, the following types of shares are mentioned:

Types of shares part

1. A joint stock company must have common shares. The owner of common shares is a common shareholder.

2. In addition to common shares, a joint stock company may have preference shares. The owners of preferred shares are called preference shareholders. Preference shares include the following types:

a) Dividend preference shares;

b) Redeemable preference shares;

c) Voting preference shares;

d) Other preference shares as prescribed in the company’s charter and the law on securities securities.

According to this regulation, the owners of preference shares are called preference shareholders. Thus, there will be the following preferential shareholders:

– Dividend preference shares;

– Redeemable preference shares;

Voting preference shares;

– Other preferred shares as prescribed in the company charter and securities laws.

A resolution of the General Meeting of Shareholders with content that makes adverse changes to the rights of preferred shareholders can only be passed?

Conditions for a resolution of the General Meeting of Shareholders to be passed are stipulated in Clause 6, Article 148 of the 2020 Enterprise Law as follows:

Conditions for a resolution of the General Meeting of Shareholders to be passed via

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5. The resolution of the General Meeting of Shareholders must be notified to shareholders with the right to attend the General Meeting of Shareholders within 15 days from the date of approval; In case the company has a website, sending the resolution can be replaced by posting it on the company’s website.

6. A resolution of the General Meeting of Shareholders on content that adversely changes the rights and obligations of shareholders owning preferred shares may only be passed if it is approved by the number of preferred shareholders of the same type attending the meeting who own 75% or more of the total number of preferred shares of that type or approved by preferred shareholders of the same type owning 75% or more of the total number of preferred shares of that type in the case of passing a resolution in the form of soliciting written opinions. version.

According to this regulation, a resolution of the General Meeting of Shareholders with content that makes adverse changes to the rights of preferred shareholders can only be passed if it is approved by the number of preferred shareholders of the same type attending the meeting owning 75% or more of the total number of preferred shares of that type or approved by preferred shareholders of the same type owning 75% of the total number of preferred shares of that type or more in the case of passing a resolution in the form of collecting written opinions.

If a preferred shareholder dies, will the heir according to that shareholder’s will automatically become a shareholder of the company?

Transfer of shares is regulated in Article 127 of the 2020 Enterprise Law as follows:

Transfer of shares

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2. The transfer is carried out by contract or transaction on the stock market. In case of transfer by contract, the transfer documents must be signed by the transferor and transferee or their authorized representatives. In case of transactions on the stock market, the transfer order and procedures are carried out in accordance with the provisions of law on securities.

3. In case a shareholder who is an individual dies, the shareholder’s will or legal heir becomes a shareholder of the company.

4. In case a shareholder who is an individual dies without an heir, the heir refuses to inherit or is disqualified from inheritance, the number of shares of that shareholder will be resolved according to the provisions of civil law.

5. Shareholders have the right to donate part or all of their shares in the company to other individuals or organizations; Use shares to repay debt. Individuals and organizations that are gifted or receive debt repayment in the form of shares will become shareholders of the company.

6. Individuals and organizations receiving shares in the cases specified in this Article only become company shareholders from the moment their information specified in Clause 2, Article 122 of this Law is fully recorded in the shareholder register.

7. The company must register a change of shareholders in the shareholder register at the request of the relevant shareholder within 24 hours of receiving the request as prescribed in the company’s Charter.

Thus, if a preferred shareholder dies, the heirs according to that shareholder’s will will automatically become shareholders of the company.

In case a shareholder who is an individual dies without an heir, the heir refuses to inherit or is disqualified from inheritance, the number of shares of that shareholder will be resolved in accordance with the provisions of civil law.