Henry Ford the Wayward Capitalist The Structure of the Corporation: A Legal Analysis
By Melvin Aron Eisenberg
2006/09 - Beard Books
1587982889 - Paperback - Reprint -  352 pp.

A detailed legal examination of the inner workings of the modern publicly held corporation.

Publisher Comments

Categories: Banking & Finance

This book examines the roles of officers, directors, and shareholders in the governance of the modern publicly held corporation. The book shows that these corporations are managed by the senior executives, not by the board of directors. The role of the board is not to manage, but to select the managers, monitor the managersí conduct of the corporationís business, and approve major changes in the corporationís legal or business structure. To this end, the board should be composed of a majority of independent directors, and for certain purposes those directors should be constituted as a separate corporate organ. To perform its monitoring function, the board must have reliable information on the corporationís financial performance by outside independent accountants. The book also shows that the shareholdersí voting right is very important, because with the rise of institutional shareholdings, share ownership is much more concentrated than was previously believed. Finally, the book develops the importance of appraisal rights, especially as an ultimate check on managerial conflicts of interest in structural transactions, such as mergers. This volume belongs on the shelves of lawyers and businessmen.

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Melvin Aron Eisenberg is Koret Professor of Law at School of Law, University of California, Berkeley. In addition to a distinguished teaching career, he was in private practice and also served as assistant counsel to the Presidentís commission on the assassination of President Kennedy (Warren Commission). He is the author of numerous books, and is presently a consultant to the American Bar Associationís Committee on Corporate Law.

Preface vii
1. Introduction: The Received Legal Model of the Corporation 1
Part I. The Legal Role of the Body of Shareholders 7
2. Voting Rights in Closely Held Corporations: A Normative Model 9
3. Voting Rights in Publicly Held Corporations: Three Schools of Thought  18
4. Voting Rights in Publicly Held Corporations: The Conflict-of-Interest  30
5. Voting Rights in Publicly Held Corporations: The Expectations of Shareholders 37
6. Voting Rights in Publicly Held Corporations: A Normative Model 64
7. The Place of the Appraisal Right in a Normative Model of the Corporation 69
8. The Uses of a Normative Model 85
Part II. Access to the Corporate Proxy Machinery 95
9. Access to the Corporate Proxy Machinery in Connection with the Election of Directors 97
10. Access to the Corporate Proxy Machinery in Connection with Matters Other than Election to Office 128
Part III. Management Service 137
11. Officers and Directors 139
12. The Flow of Information to the Board and the Role of the Accountant 186
Part IV. Structural Changes: Corporation Combinations 213
13. The Stock Modes -- An Introduction: The De Facto and Equal-Dignity Theories of Statutory Interpretation 215
14. Stock-for-Assets Combinations 224
15. Stock-for-Stock Combinations 238
Part V. Structural Changes: Contractions and Divisions 253
16. Contractions: Sell-Offs and Partial Liquidations 255
17. Corporate Divisions: Spin-Offs, Split-Offs, and Split-Ups 267
Part VI. Voting and Appraisal Rights in Parent-Subsidiary Complexes 275
18. Wholly Owned Subsidiaries  277
19. Subsidiaries with Public Ownership 308
20. Conclusion: Normative Models of the Corporation 316
Table of Cases 321
Index 323

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