MEINEMA used as an antitake-over device for listed companies. 49 riority shares constitute another means to restrict the influence of the general meeting of the shareholders. Priority shares are a special type of shares, which give its holders certain powers in the decision-making of the company. For instance, the articles may confer a right to nominate the executive directors to the priority -the organ that consists of holders of priority shares-or a right of approval to an alteration of the articles. The rights attached to priority shares may, however, not alter the statutory division of powers between the company s organs. 50 Priority shares are usually held by the company founders, directors or a foundation(stichting).5I The powers of the general meeting of the shareholders may thus be restricted quite effectively. Nevertheless, there are limits. To prevent the appointment procedure of executive directors from being a mere formality, the nomination of a director may always be set aside by a resolution taken by a two-third majority of the votes representing more than half of the share capital (art. 2: 133/243 BW) Unless the articles state otherwise, all profits are for the benefit of the shareholders. The distribution of profits occurs after the annual account has been the supervisory board, subject to the approval ar lofa large company,by adopted by the shareholders in general meeting, or, in casee meeting. This competence may not be restricted by giving a right of approval or a right of initiative to anotherorgan or a third party(art. 2: 101/210BW) The executive and supervisory board must give the shareholders in genera meeting all the information they ask for, unless it is of vital importance to the ompany to withhold the infomation Infomation may be refused because it would prejudice the competitiveness of the company, or it would prejudice other legitimate interests of third parties. Generally, this prov ision is understood to oblige the boards to respond to questions of individual shareholders at a general meeting. 52 As mentioned above, a shareholder may request the district court to be bought r price, if his nt shareholders in such a way that he can no longer reasonably be required to continue being a shareholder. The conduct causing the buy -out is not lim ited to the conduct of shareholders in that capacity, but may as well be the conduct in the capacity of a director.3 The articles may provide for an altemative dispute settlement procedure, which prevails. Nevertheless, the mandatory nature of the provision prohibits the shareholder to waive his right. >4 No stipulation in the articles may oblige a shareholder to buy other shares, but a contractual arrangement in that respect is held See further VOOGD, Statutare beschermingsmddeln bi] beursvennootschappen Monografieen vanwege het Van der Heijden Instituut deel 32, p21 ff and VAN DEN INGH, Certif cering en certificat van aandeel bij de Bv, Monografieen vanmwege het Van der Heijden Instituut deel 35 Explanatory memorandum to Bill nr 26277, Tweede Kamer, 1998-1999, 26277, p. 9 SCHUIT, Corporate law and practie of the Netherlands, The Hague 1998, p. 67 Handboek, oc, nr. 203. 1. PIILO-RAAIMAKERS o.c. 89. DES. VAN 234 SCHILFGAARDE. o.c.. nr 64 ASSER-MAEUJER, oC, nr 504MEINEMA 12 used as an anti take-over device for listed companies.49 Priority shares constitute another means to restrict the influence of the general meeting of the shareholders. Priority shares are a special type of shares, which give its holders certain powers in the decision-making of the company. For instance, the articles may confer a right to nominate the executive directors to the priority - the organ that consists of holders of priority shares - or a right of approval to an alteration of the articles. The rights attached to priority shares may, however, not alter the statutory division of powers between the company s organs.50 Priority shares are usually held by the company s founders, directors or a foundation (stichting).51 The powers of the general meeting of the shareholders may thus be restricted quite effectively. Nevertheless, there are limits. To prevent the appointment procedure of executive directors from being a mere formality, the nomination of a director may always be set aside by a resolution taken by a two-third majority of the votes representing more than half of the share capital (art. 2:133/243 BW). Unless the articles state otherwise, all profits are for the benefit of the shareholders. The distribution of profits occurs after the annual account has been adopted by the shareholders in general meeting, or, in case of a large company , by the supervisory board, subject to the approval of the general meeting. This competence may not be restricted by giving a right of approval or a right of initiative to another organ or a third party (art.2:101/210 BW). The executive and supervisory board must give the shareholders in general meeting all the information they ask for, unless it is of vital importance to the company to withhold the information. Information may be refused because it would prejudice the competitiveness of the company, or it would prejudice other legitimate interests of third parties. Generally, this provision is understood to oblige the boards to respond to questions of individual shareholders at a general meeting.52 As mentioned above, a shareholder may request the district court to be bought out at a fair price, if his interests are damaged by the conduct of one or more other shareholders in such a way that he can no longer reasonably be required to continue being a shareholder. The conduct causing the buy-out is not limited to the conduct of shareholders in that capacity, but may as well be the conduct in the capacity of a director.53 The articles may provide for an alternative dispute settlement procedure, which prevails. Nevertheless, the mandatory nature of the provision prohibits the shareholder to waive his right. 54 No stipulation in the articles may oblige a shareholder to buy other shares, but a contractual arrangement in that respect is held 49. See further VOOGD, Statutaire beschermingsmiddelen bij beursvennootschappen, Monografieën vanwege het Van der Heijden Instituut, deel 32, p.21 ff. and VAN DEN INGH, Certificering en certificaat van aandeel bij de BV, Monografieën vanwege het Van der Heijden Instituut, deel 35. 50. Explanatory memorandum to Bill nr. 26 277, Tweede Kamer, 1998-1999, 26 277, p. 9. 51. SCHUIT, Corporate law and practice of the Netherlands, The Hague 1998, p. 67. 52. Handboek, o.c., nr. 203.1. PITLO-RAAIJMAKERS, o.c., nr. 5.89. Diss. VAN SCHILFGAARDE, o.c., nr. 64. 53. ASSER-MAEIJER, o.c., nr. 504. 54. ASSER-MAEIJER, o.c., nr. 494