What is Supermajority?
A corporate amendment in a company’s charter requiring a large majority (anywhere from 67-90%) of shareholders to approve important changes, such as a merger.
This is sometimes called a “”supermajority amendment””. Often a company’s charter will simply call for a majority (more than 50%) to make these types of decisions. Read more for examples and further explanation including related video clips and also comments
Example explains Supermajority
For example, let’s say the TSJ Sports Conglomerate is faced with a merger proposal from ABC Sports Inc. If the company has a supermajority amendment in it’s charter, then before it is able to merge (even if management fully endorses the move) the company will need to hold a shareholder vote on the issue and gain a majority equal to, or greater than, the amendment specifies (anywhere from 67-90%).
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