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Corporate Laws Committee Takes Steps to Provide for
Shareholder Access to the Nomination Process
CHICAGO, June 29, 2009 - The Committee on Corporate Laws of the American Bar Association Section of Business Law approved proposed amendments to the Model Business Corporation Act regarding proxy access for director nominations and reasonable reimbursement for shareholder expenses incurred in proxy contests for director elections.
The committee will publish these proposed amendments for public comment in the August edition of The Business Lawyer. Following publication, the committee will consider them for adoption.
These proposed amendments will expressly provide a vehicle for the directors or shareholders of corporations in Model Act states to establish their own procedures, through their corporation's bylaws, to allow shareholder access to the corporation's proxy statement to nominate directors and to allow shareholders to be reimbursed for reasonable expenses incurred in connection with proxy contests for director elections.
According to committee chair Herbert S. Wander, "the committee strongly believes that the best interests of all constituencies will be served by providing for private ordering by the board of directors and the shareholders in the nomination process." He further noted that "these proposals demonstrate the dynamic and historical role state corporation statutes have had and are having in the positive development of corporation law in the United States."
For nearly 60 years, the Committee on Corporate Laws has maintained responsibility for the Model Business Corporation Act, adopted in whole or in part by 30 states. The MBCA serves as a model for corporate statutes throughout the United States.
Members of the committee are corporate lawyers, general counsels, legal academics and judges, all of whom devote serious attention to the most important corporate law issues of the day. Committee members also revise the MBCA as needed to address these issues.
With more than 60,000 members, the ABA Section of Business Law is one of the association's largest sections. It provides business lawyers with education and analysis that furthers the development and improvement of business law, and it helps its members serve their clients competently, efficiently and professionally.
With more than 400,000 members, the American Bar Association is the largest voluntary professional membership organization in the world. As the national voice of the legal profession, the ABA works to improve the administration of justice, promotes programs that assist lawyers and judges in their work, accredits law schools, provides continuing legal education, and works to build public understanding around the world of the importance of the rule of law.
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