Proxy

A representative; an agent; a document appointing a representative.

A proxy is a person who is designated by another to represent that individual at a meeting or before a public body. It also refers to the written authorization allowing one person to act on behalf of another.

In corporate law, a proxy is the authority to vote stock. This authority is generally provided by the charter and bylaws of a corporation or by a state statute. If authority is not provided, a stockholder cannot vote by proxy. The record owner of the stock whose name is registered on the corporate books is the only individual who can delegate the right to vote. In the absence of an express requirement, no particular form is necessary for a proxy. It must, however, be evidenced by a sufficient written grant of authority. A proxy is not invalid if minor errors or omissions appear on the document.

Generally any power that a stockholder possesses at a corporate meeting can be delegated to a proxy. An ordinary proxy can vote on regular corporate business, such as the amendment of the bylaws. The proxy is not authorized to vote, however, on extraordinary corporate business, such as a merger, unless given special authority to do so. When a proxy acts within the scope of her authority, under agency principles, the stockholder is bound as if she acted in person.

A proxy can be revoked at any time, unless it is coupled with an interest or made expressly irrevocable. The sale of a stockholder's shares automatically revokes any proxies previously given to vote those shares. A proxy can also be revoked when the stockholder gives a subsequent proxy or attends the meeting in person. A stockholder can act as a proxy for another shareholder, but it is not necessary for a proxy to be a stockholder.

A sample proxy statement used by a fictional company to notify its stockholders of upcoming annual meeting of shareholders