buisness law: Rights of Shareholders

Business Law [Your name] [Institution’s name] Rights of Shareholders The aim of this paper is to examine the case of Nance who is one of the founders and shareholder of Garlicbrew Inc. which produces a special kind of beer using garlic in the brewing process. Out of 10,000 shares, Nance bought 100 shares of the corporation. She wants to have access to the company books and records as she plans to launch a new beer and so, wants to be more informed about the business process and market. However, she her request was turned down by the corporate officers. Generally corporate shareholders are granted certain rights under the common as well as statute law which includes inspection of company books and records provided that they have an equity interest in the firm. According to Delaware Corporation Law, a shareholder can only claim for reviewing corporate records if he/she is able to provide a reasonable and valid purpose for it. The valid reasons include; (1) shareholder want to examine company’s past and present status and its capability to pay dividends and (2) shareholder wants to be informed about the business transactions on the basis of which he could make voting decisions (Balotti & Finkelstein, 2010, p. 201). In other words, it is not a shareholder’s absolute right to inspect corpor...