| Abstract: | Publicly traded corporations rarely use the nearly absolutefreedom afforded them to draft charters that deviate from thedefault terms of state corporation law. Conventional explanationsfor this phenomenon are unconvincing. A more promising explanationlies in the lack of any feasible amendment mechanism that willassure efficient adaptation of charter terms as changing circumstancesdictate during the long expected lifetime of a public corporation.In effect, by adopting state law default terms, corporationsdelegate to the state the process of amending charter provisionsover time. |
