Page 66 of The Time for Love
Martin, Sophy, and Lady Bracknell nodded their understanding and encouragement. They watched as Brumidge bent over the document, poring over each page, then flipping back to check earlier clauses, all the while muttering under his breath.
Finally, he nodded to himself—one satisfied nod—then he looked up, folded his hands on the document, and fixed his gaze not on Martin but on Sophy. “Miss Carmichael, your ladyship, as to the question of purpose, this document is occasionally—possibly even frequently—used when a family-owned company has, over several generations, had their shareholding split and split and split again until there are a very large number of part owners, each holding a few voting shares. Such a situation renders making the decisions necessary to manage the company—those executive decisions that generally require a majority vote of shareholders—extremely difficult. Consequently”—he tapped the papers—“this type of document is enacted, usually between the members of a branch of the original founding family.”
He continued, “For instance, let’s hypothesize that a company is founded by one man who has four children, sixteen grandchildren, and sixty-four great-grandchildren, and in each generation, the shares are equally split among the offspring. Once the four children and the sixteen grandchildren have passed, that leaves the company in the hands of sixty-four individuals, all with equal voting rights.”
Brumidge spread his hands. “Obviously, a company board with sixty-four people seated around the boardroom table, each with equal say, would have a difficult time coming to a decision on any issue. To solve the problem and make the company voting structure manageable again, the great-grandchildren might consolidate their voting rights by using this instrument.” He tapped the document again. “In our hypothetical case, the descendants of each of the sixteen grandchildren might use this document to transfer the voting rights of their shares to one of their number—say one sibling in each group—so that there would be only sixteen people around the boardroom table again. It might even be that some of those sixteen agree to transfer the rights they hold to maybe six final individuals. All those transfers would be made legal through enacting a document such as this one.”
Martin glanced at Sophy.
With her brow lightly furrowed and her gaze locked on the document, she slowly nodded. “I see.” Frowning more definitely, she met Brumidge’s eyes. “But having a large number of shareholders isn’t a problem at Carmichael Steelworks. There are only three shareholders. Myself and my two cousins.”
Brumidge frowned. After a moment, he asked, “If I might inquire, of the three of you, who holds the controlling interest? Who is the majority shareholder?”
“I am. It was my father who founded the company, and I hold seventy percent of the shares.”
“Ah.” Brumidge’s expression grew a lot more serious. He glanced at Martin, then looked back at Sophy. “Miss Carmichael, if you had signed this document, your shares would have effectively changed from voting shares to shares voted by proxy.”
Sophy narrowed her eyes. “Exactly what does that mean?”
“It means”—Brumidge drew breath and shot another glance at Martin—“that instead of controlling the company as, I surmise, you currently do, making whatever decisions you deem fit, you would lose that ability, and someone else—per this document, the other shareholders—would have the legal right to make those decisions on your behalf.” He held up a hand. “To be clear, you would still be a part owner in the sense that you would benefit to the usual degree from any distribution of profit made by the company. In other words, you would still receive seventy percent of all payments from the company to the shareholders. If the company was sold, you would receive seventy percent of the sale price. Essentially, had you signed, you would have retained your stake in the company, but would have given up the rights to control the company’s decisions. Via this document, those rights would have passed to the other shareholders.”
His features like stone, Martin said, “I didn’t see any name given for the proposed proxy holder.”
“Indeed. Instead of a specific holder, the voting rights are to be equally distributed among the remaining shareholders.” Brumidge looked at Sophy. “That’s unusual, but not unheard of.”
Sophy drew in a huge breath, then in a tight voice said, “So had I signed that document, the right to make any and all decisions regarding Carmichael Steelworks would have passed to my cousins.”
Brumidge nodded. “Exactly.”
* * *
Martin escorted a rather pale and tight-lipped Sophy and her gruffly worried grandmother back to the Bracknell town house. They returned via the mews and entered the kitchen to find Higginbotham waiting.
“Mrs. Canterbury is in the drawing room, ma’am. Hector escorted her here and is waiting with her.”
Lady Bracknell nodded. “Thank you, Higginbotham. And Queerly?”
The cook-housekeeper looked up from the table where she was chopping vegetables. “Yes, ma’am?”
“Gird your loins, woman. I suspect we’re going to have an impromptu dinner party.”
Queerly perked up and eagerly asked, “How many diners, ma’am?”
Lady Bracknell looked at Sophy and arched her brows.
Sophy rapidly calculated. “In addition to her ladyship, I believe there’ll be five others.”
Queerly was already wiping her hands and hurrying to her pantry. “Excellent! You won’t be disappointed, my lady.”
“I know, Queerly. I never am.” Lady Bracknell led Martin and Sophy into the front hall and thence to the drawing room, an elegantly furnished room at the front of the house.
Hector was standing just inside the door. He looked hugely relieved when Sophy walked in, and he nodded gratefully to Martin.
Sophy’s aunt sprang up from an armchair by the hearth. “Sophy! Thank God you’re all right. What on earth happened?” Julia swept up to Sophy and embraced her.
Sophy patted her aunt’s shoulder and rather unconvincingly tried to reassure Julia that she was well.
Julia stepped back and peered at Sophy’s face. “Silly girl,” she gently chided. “I can see you’re upset.”
