TheCorporateCounsel.net

I previously blogged that Delaware was considering an amendment to the Delaware General Corporation Law that would modify director voting rules. This amendment has now been adopted – and will be effective August 1st – and primarily addresses two items with respect to director elections:

– It amends Section 141(b) to provide that a director resignation can be made effective upon the happening of a future event, coupled with the authority to make such a resignation irrevocable if the director fails to achieve a specified vote for re-election. This amendment allows Delaware corporations to voluntarily switch to a voting standard that is different from a plurality one.

– It amends Section 216(b) to provide that a by-law adopted by shareholders that prescribes the vote required for director elections may not be further amended or repealed by a Board of Directors.

We continue to post law firm memos regarding this development in the “Majority Vote Movement” Practice Area.

FASB and IASB Publish First Draft Chapters of Joint Conceptual Framework

Last week, the FASB and IASB published the first installments of their joint conceptual framework – globalization is here! Here is the related press release and the draft chapters.

SEC Issues NYSE’s Proposal to Eliminate Annual Report Delivery

A few weeks ago, the SEC issued a NYSE proposal (which had just been amended since it was first submitted to the SEC last September) in an effort to eliminate the current NYSE requirement that a listed company “physically” distribute an annual report to shareholders. Note that this proposal would have the biggest impact on foreign private issuers, who aren’t subject to the SEC’s proxy rules – US companies would still be required by Rule 14a-3(b) to deliver proxy statements that are accompanied or preceded by annual reports meeting the requirements of Rule 14a-3 (at least until the SEC’s e-Proxy proposal is adopted).

The NYSE’s proposal would allow a company to satisfy the annual financial statement distribution requirement by making its annual report available on its corporate website, with a prominent undertaking to deliver a paper copy, free of charge, to any shareholder who requests it – listed companies would also be required to issue a press release stating that its annual report has been filed with the SEC and that shareholders have the ability to receive a hard copy of the company’s complete audited financial statements free of charge upon request. The NYSE’s proposal would also specifically require listed companies to maintain websites.