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NO. 26. AN ACT RELATING TO THE AUTHORIZATION OF APPOINTMENT OF PROXIES BY ELECTRONIC TRANSMISSION.

(H.202)

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1. 11A V.S.A. § 7.22(b) is amended to read:

(b) A shareholder may appoint a proxy to vote or otherwise act for him or her by:

(1) signing an appointment form, either personally or by his or her attorney-in-fact; or

(2) by transmitting to the corporation or the corporation’s duly authorized agent an appointment of a proxy by electronic transmission, including telephone or e-mail.

Sec. 2. 11A V.S.A. § 7.24 is amended to read:

§ 7.24. CORPORATION’S ACCEPTANCE OF VOTES

(a) If the name signed or delivered by electronic transmission on a vote consent, waiver, or proxy appointment corresponds to the name of a shareholder, the corporation, if acting in good faith, is entitled to accept the vote, consent, waiver, or proxy appointment and give it effect as the act of the shareholder.

(b) If the name signed or delivered by electronic transmission on a vote, consent, waiver, or proxy appointment does not correspond to the name of its shareholder, the corporation, if acting in good faith, is nevertheless entitled to accept the vote, consent, waiver, or proxy appointment and give it effect as the act of the shareholder if:

(1) the shareholder is an entity and the name signed or delivered by electronic transmission purports to be that of an officer or agent of the entity;

(2) the name signed or delivered by electronic transmission purports to be that of an administrator, executor, guardian, or conservator representing the shareholder and, if the corporation requests, evidence of fiduciary status acceptable to the corporation has been presented with respect to the vote, consent, waiver, or proxy appointment;

(3) the name signed or delivered by electronic transmission purports to be that of a receiver or trustee in bankruptcy of the shareholder and, if the corporation requests, evidence of this status acceptable to the corporation has been presented with respect to the vote, consent, waiver, or proxy appointment;

(4) the name signed or delivered by electronic transmission purports to be that of a pledgee, beneficial owner, or attorney-in-fact of the shareholder and, if the corporation requests, evidence acceptable to the corporation of the signatory’s authority to sign or deliver by electronic transmission for the shareholder has been presented with respect to the vote, consent, waiver, or proxy appointment;

(5) two or more persons are the shareholder as cotenants or fiduciaries and the name signed or delivered by electronic transmission purports to be the name of at least one of the co-owners and the person signing or delivering by electronic transmission appears to be acting on behalf of all the co-owners.

(c) The corporation is entitled to reject a vote, consent, waiver, or proxy appointment if the secretary or other officer or agent authorized to tabulate votes, acting in good faith, has reasonable basis for doubt about the validity of:

(1) the signature on it;

(2) *[or about]* the signatory’s authority to sign for the shareholder; or

(3) the electronic transmission by which the proxy appointment was made.

* * *

Sec. 3. 11B V.S.A. § 7.24(a) and (e) are amended to read:

(a) Unless the articles or bylaws prohibit or limit proxy voting, a member may appoint a proxy to vote or otherwise act for the member by:

(1) signing an appointment form either personally or by an attorney-in-fact; or

(2) by transmitting to the corporation or the corporation’s duly authorized agent an appointment of proxy by electronic transmission, including telephone or e-mail.

(e) Appointment of a proxy is revoked by the person appointing the proxy:

(1) attending any meeting and voting in person; *[or

]*

(2) prior to a vote being taken on an action, *[signing and]* delivering to the secretary or other officer or agent authorized to tabulate proxy votes either a signed writing or an electronic transmission stating that the appointment of the proxy is revoked or a subsequent appointment form.

Sec. 4. 11B V.S.A. § 7.27 is amended to read:

§ 7.27. CORPORATION’S ACCEPTANCE OF VOTES

(a) If the name signed or delivered by electronic transmission on a vote, consent, waiver, or proxy appointment corresponds to the name of a member, the corporation if acting in good faith is entitled to accept the vote, consent, waiver, or proxy appointment and give it effect as the act of the member.

(b) If the name signed or delivered by electronic transmission on a vote, consent, waiver, or proxy appointment does not correspond to the record name of a member, the corporation if acting in good faith is nevertheless entitled to accept the vote, consent, waiver, or proxy appointment and give it effect as the act of the member if:

(1) the member is an entity and the name signed or delivered by electronic transmission purports to be that of an officer or agent of the entity;

(2) the name signed or delivered by electronic transmission purports to be that of an attorney-in-fact of the member and if the corporation requests, evidence acceptable to the corporation of the *[signatory’s]* authority of the attorney-in-fact to *[sign for]* represent the member has been presented with respect to the vote, consent, waiver, or proxy appointment;

(3) two or more persons hold the membership as cotenants or fiduciaries and the name signed or delivered by electronic transmission purports to be the name of at least one of the coholders and the person signing or delivering by electronic transmission appears to be acting on behalf of all the coholders; and

(4) in the case of a mutual benefit corporation:

(A) the name signed or delivered by electronic transmission purports to be that of an administrator, executor, guardian, or conservator representing the member and, if the corporation requests, evidence of fiduciary status acceptable to the corporation has been presented with respect to the vote, consent, waiver, or proxy appointment;

(B) the name signed or delivered by electronic transmission purports to be that of a receiver or trustee in bankruptcy of the member, and, if the corporation requests, evidence of this status acceptable to the corporation has been presented with respect to the vote, consent, waiver, or proxy appointment.

(c) The corporation is entitled to reject a vote, consent, waiver, or proxy appointment if the secretary or other officer or agent authorized to tabulate votes, acting in good faith, has reasonable basis for doubt about the validity of:

(1) the signature on it;

(2) *[or about]* the signatory’s authority to sign for the member; or

(3) the electronic transmission by which the proxy appointment was made.

(d) The corporation and its officer or agent who accepts or rejects a vote, consent, waiver, or proxy appointment in good faith and in accordance with the standards of this section are not liable in damages to the member for the consequences of the acceptance or rejection.

(e) Corporate action based on the acceptance or rejection of a vote, consent, waiver, or proxy appointment under this section is valid unless a court of competent jurisdiction determines otherwise.

Approved: May 21, 2001