Reference no: EM132234473

In the company, shareholder also can enjoy the rights. For example, shareholders can view the books and record of the company. Shareholders can sue directors and officers if they are not properly managed. If a company liquidates its assets, its shareholders have a right to a proportionate allocation of the proceeds. However, creditors, bondholders, and preferred stockholders have precedence over common stockholders. Furthermore, they need to attend, in person or via conference call, the corporation's annual meeting to learn about the company's performance. For the common shareholders who do not attend the voting meeting have the right to vote by proxy through the mail or online.

Shareholders, also known as stockholder, are any individual, company or institution that owns at least one share of the company's stock. Since shareholders are the owners of the company, they benefit from the company's success in the form of increased stock valuation. If the company performs poorly and the stock price falls, shareholders may lose money. A subscriber of shares is not regarded as the shareholder until the shares are actually allotted to him. For example, the extent of the share capital held by them. The legal representative of the deceased member is a shareholder, not the member, until and unless his name is recorded in the register of members of the company. Hence, it can be said that every shareholder is a member but every member, is not a shareholder.