1.Minimum Share Ownership Requirements Assumption (Europe) The incentive for a shareholder with a small amount of shares to bring a legitimate suit is very likely small. US Continental Europe Legitimate motives o The benefits of the lawsuit multiplied by the probability exceed the costs of litigation,including nonmonetary cost. Percentage Limits (A major hurdle) A qulified Particular percentage:1%,5%,10%... No ownership percentage of requirements the company's Pros:A screening mechanism against share abusive lawsuits Cons:Preclude some legitimate suits Page·11Page  11 1. Minimum Share Ownership Requirements  Assumption (Europe) The incentive for a shareholder with a small amount of shares to bring a legitimate suit is very likely small.  Legitimate motives The benefits of the lawsuit multiplied by the probability exceed the costs of litigation, including nonmonetary cost.  Percentage Limits (A major hurdle) Particular percentage: 1%, 5%, 10%… Pros: A screening mechanism against abusive lawsuits Cons: Preclude some legitimate suits US Continental Europe No ownership requirements A qulified percentage of the company's share