Dodge v. Ford Motor Company, 204 Mich. 459, 170 N.W.

Safari File Edit View History Bookmarks Window Help () 29% Tue 10:18 PM QE . . A platform.virdocs.com C Update Apple ID Settings Appoint... Paraphr My Shel.. Busines... E To Who... b New In... S Women' .. Brief (11) Homew ... Some account services will not be View present-abstained from the vote. Andrew Sheppard then made a motion that the board of directors authorize its attorney to available until you sign in again. Q 44-5 institute a lawsuit in the name of HMNH against Reynolds and RHCS to recover damages caused by RHCS's breach of the + management contract. The Sheppards and Bilo voted to adopt the resolution. On January 19, 2001, HMNH filed suit against 8 Use the graph to RHCS and Reynolds, alleging that RHCS had breached the management contract. Reynolds and RHCS asked the trial estimate th court to dismiss the lawsuit on the grounds that HMNH's board had no authority to bring the lawsuit. Reynolds and RHCS argued that the directors were not properly elected because the Sheppards voted all their shares to elect the new directors, a violation of the shareholder voting agreement that gave RHCS the power to vote 7.5 of each of their shares. The trial court disagreed, ruling that the voting agreement was merely a revocable proxy, which the Sheppards revoked at the September 2000 shareholder meeting, and therefore, the Sheppards could vote all of their shares. Reynolds and RHCS appealed to the Arkansas Supreme Court. Glaze, Justice Care Services, Inc., and HMNH, Inc., and I authorize Reyn- RHCS argues that it entered into a voting agreement with the olds Health Care Services, Inc. to act for me and in my name UPG Sheppards and Bilo when they signed a document titled "Option and stead as fully as I could act if I were personally present, to Purchase Stock." In particular, RHCS points to the following giving to Reynolds Health Care Services, Inc., attorney and language in support of its contention that a voting agreement was agent, full power of substitution. created: The trial court found that these agreements were not voting agreements, but rather were revocable proxies. Under Ark. [HMNH] shall grant to [RHCS] a proxy to vote one-half of the issued and outstanding shares of stock of HMNH, Inc. Code Ann. $ 4-27-722 (Repl. 2001), proxies are revocable by a pending the term of this option to purchase stock, which shareholder "unless the appointment form conspicuously states JPG proxy shall be reduced to twenty-five percent of the issued that it is irrevocable and the appointment is coupled with an and outstanding shares of stock of the corporation for a interest." An appointment coupled with an interest includes the period of twenty years from the effective date of the Agree- appointment of "a party to a voting agreement created under ment to Provide Management Services to a Health Care $ 4-27-731." None of the proxy agreements stated conspicu- Facility executed the 8th day of January, 1993, as set forth ously on its face that it was irrevocable; indeed, in its reply in paragraph IV thereof, by and between Reynolds Health brief, RHCS abandons its argument that the proxies were irre- Care Services, Inc., and HMNH, Inc., upon the exercise of vocable. Nonetheless, RHCS maintains that the proxies "were this option and transfer to [RHCS] of the shares of stock merely the means of implementing the parties' foundational subject to this option. voting agreement," by which the Sheppards and Bilo gave PNG A subsequent agreement among the shareholders, dated RHCS the right to vote fifty percent of their shares in HMNH September 19, 1996, provided that the Sheppards and Bilo "shall for twenty years. Kre cos execute a proxy to Reynolds Health Care Services, Inc., appoint- However, we conclude that the document that RHCS calls ing Reynolds Health Care Services, Inc. as [their ] proxy to vote a "voting agreement" is nothing more than a revocable appoint- 7.5 shares of each of the said shareholder's stock held in HMNH, ment of proxy. The plain language of the agreement says nothing Inc." Those proxies were executed by each of the Sheppards and about how the stock is to be voted; it merely gives RHCS the right Bilo on October 21, 1996; the proxy agreements provided as to vote a percentage of the stock. Because the agreement does not follows: 'provide for the manner in which" the shares are to be voted, it is not a voting agreement; it is a proxy. I, the undersigned shareholder of HMNH, Inc., an Arkan- Further, the proxies assigned to RHCS were revocable. Logo sas corporation, do hereby appoint Reynolds Health Care Thus, the Sheppards and Bilo were acting within their rights Services, Inc., an Arkansas corporation, my true and law- as shareholders when they voted to revoke their proxies at the ful attorney and agent, for me and in my name, place and September 2000 shareholders' meeting. Accordingly, the trial stead to vote as my proxy 7.5 shares of stock held by me court did not err when it concluded that the actions of the duly in HMNH, Inc. at any stockholders' meetings to be held BB elected board of directors in voting to authorize the instant law- between the date of this proxy and 20 years from the effect suit were valid. tive date of the Agreement to Provide Management Services to a Health Care Facility dated January 7, 1993, as set forth IMG_7047 in Paragraph IV thereof, by and between Reynolds Health Judgment for HMNH affirmed. 75,985 MAY 3