Also known as: stockholders of record · shareholder of record · shareholders of record · record stockholder · record shareholder · registered owner
Written by attorneys · grounded in primary & secondary sources — see below
A shareholder whose name appears in the corporation's stock ledger as the legal owner of shares on the record date fixed for determining voting eligibility or other rights. The corporation may adopt a procedure allowing a beneficial owner to file a certificate and receive treatment as the record shareholder for specified rights. To the extent the beneficial owner receives those rights, the listed record shareholder loses them.
Summit Bank holds shares registered in its name for the benefit of Sean Steele. The board adopts a written procedure permitting beneficial owners to file digital certificates and obtain direct voting rights. Sean files the required certificate signed by both parties. At the contested election Summit Bank may not vote the shares because the corporation must treat Sean as the record shareholder for voting purposes.
Sterling Manufacturing fixes a record date and mails proxy materials only to the stockholders listed on its books. Sarah Sullivan appears as the record holder of one block of shares even though a broker holds the certificates in street name for her account. The corporation counts Sarah's executed proxy because she is the stockholder of record on the date fixed for voting eligibility.
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Sapphire Technologies distributes cash dividends to the stockholders listed on its records. Several checks remain uncashed for years. Delaware asserts custody over the funds because the record owners reside in that state. The corporation treats only the listed stockholders of record as entitled to the distributions until a claim is resolved.
Atlas Corp. receives consent cards from parties claiming authority over shares. The inspectors examine the cards and accept only those signed in the exact name of the stockholder of record appearing on the corporate books. Cards bearing a different name are rejected even though the signer claims beneficial ownership.
Carlton owns all shares of several corporations that operate taxicabs. A judgment creditor seeks to reach the assets of one corporation by showing that Carlton is the true owner. The court looks past the nominal record shareholders listed on the books and treats Carlton as the controlling stockholder for liability purposes.
A corporation declares a stock dividend and issues new shares only to the persons listed as stockholders of record on the corporate books. Simon Stern receives the additional shares because his name appears on the ledger even though a trust holds the beneficial interest. The corporation refuses to recognize any claim by the trust until a transfer of record title occurs.
A corporation may adopt a procedure allowing the beneficial owner to file a certificate and be treated as the record shareholder for voting. Once the certificate is filed the listed record holder loses the voting rights that shift to the beneficial owner.
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A shareholder who acquires shares by inheritance from a prior owner satisfies the contemporaneous ownership requirement for the entire period the decedent held the stock. The new record shareholder may therefore maintain a derivative action challenging conduct that occurred before the transfer of record title.
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If the name signed on a voting instrument matches the name of the stockholder of record the corporation may accept the instrument in good faith without further inquiry into authority or internal approvals.
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The notice of meeting must state the record date for determining which shareholders may vote when that date differs from the record date for receiving notice. Failure to include the voting record date renders the notice defective.
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…of 8 Del.C. § 251(c) that notice of the time, place and purpose of a meeting to consider a merger must be sent to each shareholder of record at least 20 days prior to the date of the meeting. In the instant case an original proxy statement was mailed on January 18, 1981 giving notice of the time, place and purpose of the…