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Question:

Consider the following statements:
Statement 1: Any amendments to the company’s bylaws typically occur at Extraordinary General Meetings (EGMs).
Statement 2: Proxy voting is adopted as a practice in order to protect the rights of creditors.
Which of the following is most likely?

A Only Statement 1 is correct.
Explaination

An amendment to corporate bylaws would normally take place during an EGM, which covers significant changes to a company, such as bylaw amendments. Proxy voting is put in place to protect shareholders. Debtholders use collateral and covenants to protect their interests.