Law School Case Brief
Hoschett v. TSI Int'l Software - 683 A.2d 43 (Del. Ch. 1996)
Section 211(b) of the Delaware General Corporation Law provides as follows: An annual meeting of stockholders shall be held for the election of directors on a date and at a time designated by or in a manner provided in the bylaws. Any other proper business may be transacted at the annual meeting.
Plaintiff Fred G. Hoschett is the registered owner of 1,200 shares of common stock of the defendant TSI International Software, a corporation that had less than 40 shareholders of record and it had never held an annual meeting for the election of directors. Plaintiff Hoschett filed a complaint seeking an order requiring Defendant TSI to hold an annual meeting of its shareholders as required by Section 211 of the Delaware General Corporation Law (DGCL). Both parties filed cross motions for summary judgment.
Does a shareholder action satisfy the mandatory requirement for the conduct of an annual meeting?
The court ordered TSI to hold an annual meeting and make available a complete list of shareholders as required by the DGCL. The court held that the mandatory requirement that an annual meeting of shareholders be held was not satisfied by shareholder action pursuant to section 228 of the DGCL purporting to elect a new board or to re-elect an old one.
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