TheCorporateCounsel.net

Here’s a keeper for you – several Richards Layton attorneys recently published an article in The Corporate Governance Advisor that’s a primer on key Delaware law considerations for annual meetings of stockholders. This excerpt discusses common voting standards for matters other than the election of directors:

A variety of voting standards may be applicable to other matters. Certain extraordinary matters may be subject to heightened voting requirements under the DGCL or the corporation’s certificate of incorporation or bylaws, while the voting standard applicable to other general corporate action is typically set forth in the corporation’s bylaws. Common voting standards include:

1. Majority of Votes Cast

2. Majority in Voting Power of Outstanding Shares (default statutory vote for specified extraordinary matters, which can only be increased, but not reduced, in the certificate of incorporation)

3. Majority in Voting Power of Shares Present in Person or by Proxy at the Meeting and Entitled to Vote on the Subject Matter (default under Section 216(2) of the DGCL for all matters other than the election of directors and specified extraordinary matters)

4. Majority in Voting Power of Shares Present in Person or by Proxy at the Meeting and Entitled to Vote at the Meeting (a majority of the quorum)

Other topics addressed in the article include pre-meeting considerations, quorum, adjournment, the treatment of abstentions and broker non-votes, and virtual meeting considerations.

– John Jenkins