STOCKHOLDER. In the strict sense of the term, a person who owns one or more shares of stock in a corporation. and who has been recognized by the latter as having the rights commonly incidental to such ownership. Entry of a person's name on the books of a cor poration as the owner of stock is the best evi dence of his standing as a stockholder, and as long as his name remains there he may gen erally exercise all a stockholder's privileges. However, a person to whom shares of stock have been transferred, but whose name has not yet been entered on the books, is sometimes treated as if he were a stockholder and spoken of as such. A corporation is protected in paying divi dends to a person whose name remains on its hooks as a stockholder, even if he has transferred his shares of stock. provided the purchaser has not given notice of that fact. A stockholder of record has the right to vote in certain meetings. the most important of which, perhaps, is one for the election of officers. Each stockholder may vote the number of shares he OWI1S, and thns'one person owning the majority of the stock of a cor poration may control its elections and policy against the wishes of a great number of holders of a small number of shares aggregating less than the majority. Among the rights of a stock holder are: the right to protest and invoke the aid of the courts against a misuse of the funds of the corporation, or against fraud by the ma jority stockholders or the officers: to object to a change in the kind of business which the charter authorizes it to carry on; the right to inspect all or any of the books of the corporation at rea sonable times and places; and to receive divi dends out of the earnings, when a surplus has accumulated, which is not needed for running the business, or for improvements. In many States
a stockholder is only liable for the debts of the corporation to the amount of his stock, that is. he only loses what he has paid in, assuming he has paid in the par value of his stock, in case of insolvency of the corporation. If a subscriber to the stock of a corporation has not paid in the full par value of the amount of stock subscribed for by him, creditors of the corporation may hold him for the balance remaining unpaid. A stock holder is not strictly a creditor of the corpora tion to the amount of his stock. as he is deferred to corporate creditors on a final distribution of assets; but he may become a creditor by a loan of money o• sale of goods. and thus stand on an equal footing with the others as to such claims, in most jurisdictions. See CORPORATION; STOCK; and consult authorities there referred to.