13.1-662 - Voting entitlement of shares.
§ 13.1-662. Voting entitlement of shares.
A. Except as provided in subsections B, C, D and E or unless the articles ofincorporation provide otherwise, each outstanding share, regardless of class,is entitled to one vote on each matter voted on at a shareholders' meeting.
B. Unless the articles of incorporation provide otherwise, in the election ofdirectors each outstanding share, regardless of class, is entitled to onevote for as many persons as there are directors to be elected at that timeand for whose election the shareholder has a right to vote.
C. Shares that have been called for redemption are not entitled to vote onany matter and, except as to any right of conversion, shall not be deemedoutstanding shares after notice of redemption is mailed to the holders and asum sufficient to redeem the shares has been deposited with a bank, trustcompany, or other financial institution with irrevocable instruction andauthority to pay the holders the redemption price on surrender of the shares.Such instruction may provide that the amount so deposited and any interestthereon not claimed within a specified period, not less than two years, afterthe redemption date shall be repaid to the corporation whose shares are soredeemed, and the persons entitled thereto shall thereafter have only theright to receive the redemption price as unsecured creditors of suchcorporation.
D. The shares of a corporation are not entitled to vote if they are owned,directly or indirectly, by a second corporation, domestic or foreign, and thefirst corporation owns, directly or indirectly, a majority of the sharesentitled to vote for directors of the second corporation.
E. If a corporation holds in a fiduciary capacity its own shares or shares ofa second corporation that owns directly or indirectly a majority of sharesentitled to vote for directors of the first corporation, such shares shallnot be deemed to be outstanding and entitled to vote unless:
1. The corporation has authority to vote the shares only in accordance withdirections of the principal or beneficiary; or
2. A co-fiduciary exists, pursuant to § 6.1-31.2 or otherwise, in which eventthe co-fiduciary may vote the shares.
F. Shares standing in the name of another corporation, domestic or foreign,may be voted by such officer, agent or proxy as the bylaws of suchcorporation may prescribe, or, in the absence of such provision, as the boardof directors of such corporation may determine.
G. Shares standing in the name of a partnership may be voted by any partner.Shares standing in the name of a limited liability company may be voted asthe articles of organization or an operating agreement may prescribe, or inthe absence of any such provision as the managers, or if there are nomanagers, the members of the limited liability company may determine.
H. Shares held by two or more persons as joint tenants or tenants in commonor tenants by the entirety may be voted by any of such persons. If more thanone of such tenants votes such shares, the vote shall be divided among themin proportion to the number of such tenants voting.
I. Shares held by an administrator, executor, guardian, conservator,committee or curator representing the shareholder may be voted by such personwithout a transfer of such shares into such person's name. Shares standing inthe name of a trustee may be voted by the trustee, but no trustee is entitledto vote shares held by the trustee without a transfer of such shares into thetrustee's name.
J. Shares standing in the name of a receiver or a trustee in proceedingsunder the Bankruptcy Reform Act of 1978 may be voted by such person. Sharesheld by or under the control of a receiver or a trustee in proceedings underthe Bankruptcy Reform Act of 1978 may be voted by such person without thetransfer thereof into such person's name if authority to do so is containedin an order of the court by which such person was appointed.
K. Nothing herein contained shall prevent trustees or other fiduciariesholding shares registered in the name of a nominee pursuant to § 6.1-31 fromcausing such shares to be voted by such nominee as the trustee or otherfiduciary may direct. Such nominee may vote shares as directed by a trusteeor other fiduciary without the necessity of transferring the shares to thename of the trustee or other fiduciary.
L. A shareholder whose shares are pledged is entitled to vote such sharesuntil the shares have been transferred into the name of the pledgee, andthereafter the pledgee is entitled to vote the shares so transferred.
M. The articles of incorporation may provide that the holders of bonds ordebentures shall be entitled to vote on specified matters and such rightshall not be terminated except upon consent of the holders of two-thirds inaggregate principal amount.
N. Subject to the provisions of § 13.1-665, when shares are held by more thanone of the fiduciaries referred to in this section, the shares shall be votedas determined by a majority of such fiduciaries, except that: (i) if they areequally divided as to a vote, the vote of the shares is divided equally and(ii) if only one of such fiduciaries is present in person or by proxy at ameeting, the fiduciary shall be entitled to vote all the shares. A proxyapparently executed by one of several of such fiduciaries shall be presumedto be valid until challenged and the burden of proving invalidity shall reston the challenger.
(Code 1950, §§ 13-192 to 13-198, 13-203, 13.1-32; 1956, c. 428; 1958, c. 564;1975, c. 500; 1984, c. 366; 1985, c. 522; 1990, c. 267; 1997, c. 801; 2005,c. 765.)