[FREE LEGAL ADVICE]

QUESTION
I am a shareholder of a company with charter capital of 500 million, I have contributed capital since 2003 is 10 million, accounting for 2%. Now the company meets with shareholders to approve a new charter to increase contributed capital to 50 billion and issue another 50 billion minus 500 million to 49.5 billion ordinary shares, is that correct? And can I make an application to the company to buy at the agreed price, because the company promises to pay 31 times more if they sell old shares to a partner.

ANSWER:
Hi, thank you for sending your question to MEDLAW, because the information you provided is incomplete, MEDLAW is not enough to give you an accurate advice. However, your case can refer to the following regulations:

Regarding your question, firstly, in order to approve a new charter to increase contributed capital and issue additional shares for sale to increase charter capital, the company must meet the conditions on attendance rate and ratio at the meeting. voting according to the provisions of Articles 145, Article 148 of the Law on Enterprises 2020. Specifically, in terms of attendance rate, it is necessary to have the number of shareholders attending the meeting representing more than 50% of the total number of votes. In case the first meeting is not eligible to proceed, the invitation to the second meeting shall be announced within 30 days and the number of shareholders attending the meeting represents 33% of the total number of votes or more. In case the second meeting is not eligible to proceed, the notice of invitation to the third meeting shall be made within 20 days regardless of the total number of votes of the attending shareholders.

Regarding the percentage of votes for capital increase, in order for the resolution of the General Meeting of Shareholders to be valid, it is necessary to meet the ratio of 65% or more of the total number of votes in favor of all attending shareholders. In addition, the meeting of the general meeting of shareholders must be recorded in minutes and ensure the contents as prescribed in Article 150 of the Enterprise Law 2020. Thus, if the meeting of the general meeting of shareholders is about the issuance of additional shares. If the meeting is offered for sale to increase charter capital, if the above conditions are satisfied, the meeting will approve the new charter and ensure the legality of the Resolution.

Second, about asking the company to buy shares, you have the right to sell the number of shares you are holding to the company in the form of share buyback at the company's decision. The share repurchase price shall be decided by the Board of Directors. For ordinary shares, the redemption price must not be higher than the market price at the time of redemption as prescribed in Clause 2, Article 133 of the Enterprise Law 2020. For shares of other classes, unless otherwise provided for in the company's charter. or the company and related shareholders do not otherwise agree, the redemption price must not be lower than the market price. Accordingly, if the two parties agree on a different share price, shareholders have the right to request the company to buy back their shares at the agreed price, as long as it is not lower than the market price. Thus, in case the shares you are holding are other shares, you can ask the company to buy them back at the agreed price.

Specifically, the legal basis for your case is as follows:

– Clause 2, Article 133 of the Law on Enterprises 2020 stipulates on the acquisition of shares according to the decision of the company:
“The Board of Directors decides the share repurchase price. For ordinary shares, the redemption price must not be higher than the market price at the time of redemption, except for the case specified in Clause 3 of this Article. For shares of other types, unless otherwise provided for in the company's charter or the company and related shareholders do not otherwise agree, the redemption price must not be lower than the market price.

– Article 140 of the Enterprise Law 2020 provides for convening the General Meeting of Shareholders:
1. The Board of Directors convenes the Annual and Extraordinary General Meeting of Shareholders. The Board of Directors convenes an extraordinary meeting of the General Meeting of Shareholders in the following cases:
a) The Board of Directors considers it necessary for the benefit of the company;
b) The number of remaining members of the Board of Directors and Control Board is less than the minimum number of members as prescribed by law;
c) At the request of a shareholder or group of shareholders specified in Clause 2, Article 115 of this Law;
d) At the request of the Control Board;
đ) Other cases as prescribed by law and the company's charter.
2. Unless otherwise provided for in the company's charter, the Board of Directors must convene a General Meeting of Shareholders within 30 days from the date of occurrence of the case specified at Point b, Clause 1 of this Article or receive be requested to convene a meeting specified at Points c and d, Clause 1 of this Article. In case the Board of Directors fails to convene a General Meeting of Shareholders as prescribed, the Chairman of the Board of Directors and members of the Board of Directors must compensate for any damage incurred to the company.
3. If the Board of Directors does not convene the General Meeting of Shareholders as prescribed in Clause 2 of this Article, within the next 30 days, the Supervisory Board will replace the Board of Directors to convene the General Meeting of Shareholders within the next 30 days. in accordance with the provisions of this Law. In case the Supervisory Board fails to convene the General Meeting of Shareholders as prescribed, the Supervisory Board must compensate for any damage incurred to the company.
4. If the Supervisory Board fails to convene the General Meeting of Shareholders as prescribed in Clause 3 of this Article, the shareholder or group of shareholders specified in Clause 2, Article 115 of this Law has the right to convene on behalf of the company. meeting of the General Meeting of Shareholders in accordance with this Law.

– Article 145 of the Enterprise Law 2020 stipulates the conditions for conducting the General Meeting of Shareholders:
"first. The General Meeting of Shareholders shall be conducted when the number of attending shareholders represents more than 50% of the total number of votes; The specific ratio shall be prescribed by the company's charter.
2. In case the first meeting is not eligible to be conducted as prescribed in Clause 1 of this Article, the notice of invitation to the second meeting must be sent within 30 days from the intended date of the first meeting, if The company's charter does not provide otherwise. The second General Meeting of Shareholders shall be conducted when the number of shareholders attending the meeting represents 33% of the total number of votes or more; The specific ratio shall be prescribed by the company's charter.
3. In case the second meeting is not eligible to be conducted as prescribed in Clause 2 of this Article, the notice of invitation to the third meeting must be sent within 20 days from the intended date of the second meeting, if The company's charter does not provide otherwise. The third General Meeting of Shareholders shall be conducted regardless of the total number of votes of the attending shareholders.

– Points a and b, Clause 1 and Clause 2, Article 148 of the Law on Enterprises 2020 stipulate the conditions for the resolution of the General Meeting of Shareholders to be passed.
"first. A resolution on the following contents shall be passed if it is approved by the number of shareholders representing 65% or more of the total votes of all attending shareholders, except for the case specified in Clauses 3, 4 and 6. This; The specific ratio is regulated by the company's charter:
a) Types of shares and total number of shares of each class;
…
e) Other matters prescribed by the company's charter.
2. Resolutions shall be passed when approved by the number of shareholders holding more than 50% of the total votes of all attending shareholders, except for the cases specified in Clauses 1, 3, 4 and 6 of this Article. ; The specific ratio shall be prescribed by the company's charter.”.

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