To the Editor of the "Nomri-Cuma Dany News 'Stn.—The case of those New Enginering 8 per cent. Preference Shareholders who are dissatisfied with the Proposed amalgamation terms raises Jen interesting problem. and also emphasized the utility of Shareholders' Protection Associations to all partier concerned, In this. case the only thing for the oggrievel' Shareholder to do, is to gain as much support as possible and ultimately oppose the under Section 63 of the Hongkong] Ordinance No. 39 of 1932. If the application should be successful, the Jscheme as it affects them would be set aside with the result that the Jetready protracted, and probably ex-[pensive negotiations might be render-[ea Ineffective.
'A Shareholders' Protection Society, Jon the other hand could present the dissatisfied Shareholders' case to the Company, with a view to their being paid out in cash. In this way, litige-Hon could be avoided. and dissatis-{fed Shareholders would not be under the necessity of stirring up opposite The Company is, of course, relying fon Section 50 of its Arlicles of Association, which provides that all or any of the rights or privileges attaching to each class of shares may bbe modified if approved by an Ex-{traordinary Resolution of a separate meeting of the class of Shareholders affected. However, in view of the decision in Mercantile Investment Company v. International Company of Mexico (i803) 1 Eh, 484 viz:—that power to modify rights does not include power to extinguish them, the point at issue is at least open 'Will. the Shareholders' Protection Association now become a fait accompli and begin its work?
Josemn Brows, usa.
Shanghai, Oct. 30,
Text read from the printed page and cleaned; old type leaves the occasional error.