Legal Research On Shareholder Pooling Agreement

Voting right is one of the important rights of shareholders. Because shareholder can transform their inner needs and desires into legal intention through the exercise of this right. And all shareholders' intention will become the company's according to the principle of capital majority.With the development of the company system, there are more ways to exercise voting right. Beginning with directly voting to the proxy of voting, now there are cumulative voting, proxy solicitation, voting trust and pooling agreement. Shareholders have more choices with all the mechanisms of voting. Although Chinese Company Law only includes the proxy of voting and the cumulative voting, there are shareholders chose other ways to exercise their voting right in order to compete for the control of the company and fight against merge and acquisition, then some disputes arise. So this article does a legal research on shareholder pooling agreement.Beginning with raising questions, the author then discusses these questions and try to answer them. Firstly, the author sets up the theoretical foundation of the whole article, including the concept, category, functions and the differences among different ways of exercise voting right. Secondly, the author introduces its application status by discussing plenty of cases and concludes the main legal question of this agreement from these cases. Lastly, the author analyzes the effect and the remedy of shareholder pooling agreement. Besides introduction and conclusion, the main body of this article concludes four sections:The first section is a general description of shareholder pooling agreement. Beginning with the concept of shareholder pooling agreement, the author will analyze the definition of it and it's classification. Then, the author will compare it with other ways to exercise voting right and introduce its functions.The second section is about shareholder pooling agreement's application status. The author will introduce its application status by discussing plenty of cases. These cases will show the history of this agreement in other counties. And the author will discuss four of them, which happened in our own country. At last, the author will conclude the main legal question of this agreement from these cases.The third section is the analysis of the effect of shareholder pooling agreement. The main question about this agreement is whether it is a valid contract. In this part, the author starts with answering the question of whether shareholders have right to conclude the pooling agreement. Then the author will discuss the general rules about shareholder pooling agreement, including the basic rules and the special rules. The author will emphasize that this agreement cannot jeopardize the governance of company and cannot damage other shareholders and creditors of company. At last, the author will discuss whether shareholder pooling agreement should give public notice.The forth section is the analysis of the remedy of shareholder pooling agreement. The observant party of the agreement can choose compensation for damages or substantial performance. When it comes to compensation, it is hard to ascertain the damages. And it is even harder to ask for substantial performance. The author will discuss the remedy under two circumstances, which is anticipatory breach of contract and actual breach of contract. The main question is whether the court should invalid the decisions of shareholders' meeting.