Summary
Illinois Tool Works Inc. (ITW) filed a Form 8-K on February 18, 2010, reporting an amendment to its By-Laws. The primary change involves the addition of a new section creating the role of an "Emeritus Director." This role allows the Board of Directors to elect individuals who will serve in an advisory and consultative capacity to the Board and its committees. While Emeritus Directors can attend meetings and participate in discussions, they will not have voting rights and will not count towards a quorum. They will not receive any fees for their services but will be reimbursed for approved expenses. This change reflects a potential strategy to retain valuable experience and guidance from former directors without granting them formal governance powers, which could be of interest to investors as it may influence board dynamics and strategic input.
Key Highlights
- 1ITW's Board of Directors approved an amendment to the company's By-Laws on February 12, 2010.
- 2A new Section 13 has been added to Article III of the By-Laws, establishing the position of 'Emeritus Director'.
- 3Emeritus Directors will serve at the pleasure of the Board, subject to annual review.
- 4The role is advisory and consultative, allowing participation in discussions but without voting rights.
- 5Emeritus Directors will not be counted for quorum purposes.
- 6No fees will be paid to Emeritus Directors; however, expense reimbursement is permitted with Chairman approval.
- 7The Board retains the right to remove an Emeritus Director at any time.