This article discusses the concept of the ‘revocation
of a proxy’ and its pivotal role in corporate law. A proxy, derived from the
Latin word ‘procurare’ meaning ‘to manage’, is an individual who is appointed
by another to represent them. This representation typically occurs at a
shareholder meeting or before a public body. The appointment is often
formalized through a written document, bestowing upon the proxy the authority
to vote stock on behalf of the appointer. This mechanism allows shareholders to
exercise their voting rights without being physically present at the meetings.
---------------- ---------------------
-------------------- -------------------------
However, the power vested in a proxy is not
absolute or irrevocable. Every member of a corporation retains the right to
revoke a proxy. This act of withdrawal, known as the ‘Revocation of Proxy’, is
a crucial aspect of corporate governance. It signifies the dynamic nature of
proxy appointments, allowing shareholders to change their representatives based
on changing circumstances or strategies.
Shareholders can revoke
more than one proxy, provided these proxies represent different classes and
numbers of shares owned by the member. This provision ensures that shareholders
have the flexibility to manage their representation based on their diverse
shareholdings. The notice for a meeting must explicitly mention the member’s
rights, including the right to revoke more than one proxy. This requirement
ensures transparency and informs shareholders of their rights.
The process of revoking a
proxy is subject to certain conditions and procedures. If the company sends out
invitations to revoke a proxy at its own expense, these invitations must be
sent to all members of the company. This rule ensures fairness and equal
opportunity for all shareholders to reconsider their proxy appointments.
The company’s articles of
association may stipulate that the note to revoke a proxy must be filed with
the company more than 48 hours before the meeting if a vote takes place more
than 48 hours after the revocation was instructed. This provision ensures that
the company has adequate time to process the revocation and update its records
before the meeting.
The proxy revocation can’t
be required more than 24 hours before the time for counting the votes if the
votes are counted less than 48 hours after revocation was demanded. This rule
balances the need for timely revocation with the practical considerations of
vote counting.
The notice of revocation
cannot be required earlier than the time at which it was demanded. This rule
respects the timing of the shareholder’s decision to revoke the proxy. For
these purposes, the 48 or 24 hours must fall within the working hours of the
day. This requirement takes into account the business hours and excludes
weekends and holidays.
The revocation of a proxy’s
authority does not invalidate the proxy’s previous actions. This rule
recognizes the legitimacy of the proxy’s actions while their appointment was in
effect. The company must receive notice of the proxy termination before the
start of the shareholder meeting, or at such other time specified in the
articles, provided it does not exceed the maximum period for appointment of a
proxy (i.e., 48 or 24 hours). This requirement ensures that the revocation is
processed before the proxy exercises their voting rights at the meeting.
The corporation’s articles
of association can confer more extensive rights on members to revoke proxies.
There are no restrictions preventing this. This provision allows corporations
to customize their proxy rules based on their unique needs and circumstances.
A proxy revocation is
considered valid only if it meets certain criteria. It must be a written notice
that states the name and securities information of the shareholder revoking the
proxy. It must name the person being revoked as the shareholder’s proxy in the
shareholder’s meeting relating to which that person is appointed. It must be
signed by or on behalf of the shareholder revoking the proxy, or validated in a
manner determined by the shareholders. It must be delivered to the company in
accordance with the articles, bylaws, supporting documents, and instructions
contained in the shareholders meeting notice to which they relate. The company
may require proxy revocation notices to be delivered in a specific form, and
may identify separate forms for different purposes.
Unless a proxy revocation
indicates otherwise, it should be accepted as disallowing the person whose
authorization is being revoked as a proxy, the right to vote on any ancillary
or procedural resolutions put to the meeting. It should also revoke the
authority of that person as a proxy in matters relating to any adjournment of
the owners meeting to which any proxy relates, as well as the meeting itself.
A Proxy Revocation only
takes effect if it is delivered before the start of the meeting or adjourned
meeting to which it relates. This rule ensures that the revocation is processed
before the proxy exercises their voting rights at the meeting.
In the case of death or
incapacity of the maker, a proxy isn’t revoked unless, before the vote is
counted, written notice of such death or incapacity is received by the
corporation. This rule recognizes the continuity of the proxy’s authority
despite the unfortunate circumstances of the maker.
Unlike proxies, ballots
cannot be revoked once they have been cast. This rule underscores a key
difference between proxies and ballots in terms of revocability. While proxies
represent a flexible and changeable form of representation, ballots represent a
final and irrevocable decision.
‘revocation’, refers to the
official cancellation of a decree, decision, or promise. In the context of
corporate law, it pertains to the withdrawal of the authority granted to a
proxy. This flexibility allows for a more personalized approach to proxy
representation within a company, ensuring that the rights and interests of all
shareholders are adequately protected.
---------------- ---------------------
-------------------- -------------------------
revocation
revocation
rɛvəˈkeɪʃ(ə)n/
noun
the
official cancellation of a decree, decision, or promise.
"for
those who choose to break the law, the revocation of their right to bear arms
may result"
No comments:
Post a Comment