.When a partner, shareholder or a director in a company doesn’t want to attend all the meetings. He can’t attend because of busy schedule. The company or corporation gives him formal permission to nominate another person to act on his behalf. This process in which a person acts on behalf of another person especially a director or shareholder in a company is known as the irrevocable proxy. If a person signs the document and ask the other directors or shareholders to consider his proxy as himself. They can’t ask him to change his decision or decide to disagree with him as the proxy is irrevocable. It can’t be challenged by any director, shareholder or the corporation itself.
Preparing Irrevocable Proxy:
Talking about corporate meetings, there are usually two types of them. These meetings including; annual meetings and regular day to day meetings. When it comes to annual meetings, all the important shareholders and directors in a company are required to attend the meeting. But it’s not like that in case of regular or common day to day meetings. This explains that if a person i.e. director or shareholder doesn’t want to or can’t attend a meeting due to any reason. He can still get involved in the discussions and decisions made in the meeting by sending someone else as proxy. That person will act on his behalf and the participants of the meeting will consider that proxy as the person in fact.
Key Elements to include in the Irrevocable Proxy:
- Name of the company with trademark and registration number and complete address
- Include Name of the person or shareholder or director in the company who is nominating another person as irrevocable proxy
- Name of the person or partner or director who is designated for the irrevocable proxy
- Details of the authority of the designated person
- Sworn statement of the true owner or partner saying that he in fact is giving authority to another person for the irrevocable proxy
- The statement of considering the nominated person as the true director or shareholder signed by the true director
- Signature of the person who is giving proxy to another person
- Date of document signing
- Validation and termination of the proxy (i.e. violation of the proxy agreement by the nominated person)
Importance and Uses of the Irrevocable Proxy:
Irrevocable proxy is very common for the important partners and directors of a company. Especially when they run more than one business simultaneously. For example, a person is the General Director or partner in a company but he is also the CEO of another company and a limited partner in a third corporation too. This means that when there are important decisions to be made in presence of all the required members. That same person can’t be present in every meeting. So he has to nominate someone else i.e. another partner or shareholder most commonly, to act on his behalf and make the decisions that he is allowed to by the true director or director in fact.
Here is preview of a Free Sample Irrevocable Proxy Template create as Fill able PDF Form,
Here is download link for this Irrevocable Proxy Template,