A00213 Summary:

BILL NOA00213
 
SAME ASSAME AS S03265
 
SPONSORPaulin
 
COSPNSRGalef, Abinanti, Otis, Jacobson
 
MLTSPNSR
 
Amd 902 & 1002, N-PC L
 
Relates to requiring a two-thirds vote of the board in certain circumstances.
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A00213 Actions:

BILL NOA00213
 
01/06/2021referred to corporations, authorities and commissions
01/12/2021reported referred to codes
01/26/2021reported
01/28/2021advanced to third reading cal.59
02/08/2021passed assembly
02/08/2021delivered to senate
02/08/2021REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
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A00213 Committee Votes:

CORPORATIONS, AUTHORITIES AND COMMISSIONS Chair:Paulin DATE:01/12/2021AYE/NAY:25/0 Action: Favorable refer to committee Codes
PaulinAyeLemondesAye
CookAyeBlankenbushAye
GalefExcusedFriendAye
RodriguezAyeLalorAye
QuartAyePalmesanoAye
OtisAyeAngelinoAye
RozicAyeJensenAye
KimAye
SeawrightAye
DilanAye
RichardsonAye
De La RosaAye
Pheffer AmatoAye
VanelAye
CarrollAye
NiouAye
FallAye
Jean-PierreAye
Gonzalez-RojasAye

CODES Chair:Dinowitz DATE:01/26/2021AYE/NAY:22/0 Action: Favorable
DinowitzAyeMorinelloAye
PretlowAyeGiglioAye
CookAyeMontesanoAye
CymbrowitzAyeReillyAye
O'DonnellAyeMikulinAye
LavineAyeTannousisAye
PerryAye
AbinantiAye
WeprinAye
HevesiAye
FahyAye
SeawrightAye
RosenthalAye
WalkerAye
VanelAye
CruzAye

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A00213 Floor Votes:

DATE:02/08/2021Assembly Vote  YEA/NAY: 149/0
AbbateYClarkYFrontusYLalorYPaulinYSillittiY
AbinantiYColtonYGalefYLavineYPeoples-StokesYSimonY
AndersonYConradYGallagherYLawlerYPerryYSimpsonY
AngelinoYCookYGallahanYLemondesYPheffer AmatoYSmithY
AshbyYCruzYGandolfoYLunsfordYPichardoYSmullenY
AubryYCusickYGiglio JAYLupardoYPretlowYSolagesY
BarclayYCymbrowitzYGiglio JMYMagnarelliYQuartYSteckY
BarnwellYDarlingYGlickYMamdaniYRaYSternY
BarrettYDavilaYGonzalez-RojasYManktelowYRajkumarYStirpeY
BarronYDe La RosaYGoodellYMcDonaldYRamosYTagueY
BenedettoYDeStefanoYGottfriedYMcDonoughYReillyYTannousisY
BichotteYDickensYGriffinYMcMahonYReyesYTaylorY
BlankenbushYDilanYGuntherYMeeksYRichardsonYThieleY
BrabenecYDinowitzYHawleyYMikulinYRivera J YVanelY
BraunsteinYDiPietroYHevesiYMiller B ERRivera JDYWalczykY
BronsonYDursoYHunterYMiller MLYRodriguezYWalkerY
BrownYEichensteinYHyndmanYMitaynesYRosenthal D YWallaceY
BurdickYEnglebrightYJacksonYMontesanoYRosenthal L YWalshY
BurgosYEpsteinYJacobsonYMorinelloYRozicYWeinsteinY
BurkeYFahyYJean-PierreYNiouYSalkaYWeprinY
ButtenschonYFallYJensenYNolanYSantabarbaraYWilliamsY
ByrneYFernandezYJonesYNorrisYSayeghYWoernerY
ByrnesYFitzpatrickYJoynerYO'DonnellYSchmittYZebrowskiY
CahillYForrestYKellesYOtisYSeawrightYZinermanY
CarrollYFriendYKimYPalmesanoYSeptimoYMr. SpeakerY

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A00213 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A213
 
SPONSOR: Paulin
  TITLE OF BILL: An act to amend the not-for-profit corporation law, in relation to voting requirements of the board of certain corporations   PURPOSE OR GENERAL IDEA OF BILL: To require a two-thirds majority vote of the directors present at the time of the vote, if a quorum is present at that time, for a proposed merger, consolidation, or dissolution of the corporation.   SUMMARY OF SPECIFIC PROVISIONS: Section one of the bill amends the opening paragraph of paragraph a of section 902 of the not-for-profit corporation law to require that the board of a corporation proposing to participate in a merger or consol- idation shall adopt, by a vote of two-thirds of the directors present at the time of the vote, if a quorum is present at that time, or by a vote of the number of directors required under the certificate of incorpo- ration, by-laws, this chapter, and any other applicable law, a plan of merger or consolidation. Section two amends subparagraph 1 of paragraph a of section 1002 of the not-for-profit corporation law to require a vote by two-thirds of the directors present at the time of the vote, if a quorum is present at that time, in order to dissolve the corporation. Section three provides the effective date.   JUSTIFICATION: This bill will amend the Not-for-Profit Corporation Law (NPCL) in relation to corporate consolidation, merger or dissolution. Currently, the NPCL allows boards to authorize such actions by a simple majority of a quorum of the board, whereas the law requires a higher standard for other corporate action. For example, to change the number of directors, the vote of a majority of the entire board is required; to elect an officer or to purchase or sell real property on behalf of the corpo- ration, a two-thirds majority vote of the entire board is needed. Since the decision to merge, consolidate, or dissolve is arguably the most important decision that a corporation can make, this bill will amend the NPCL to require a vote in favor of such action by two-thirds of the directors present at the time of the vote, if a quorum is present at that time, or alternatively, by a vote of the number of directors required under the corporation's certificate of incorporation, its by-laws, this chapter, and any other applicable law.   PRIOR LEGISLATIVE HISTORY: 2020: A.222 Passed Assembly / S.7361 Referred to Corporation, Authori- ties and Commissions 2019: A.222 Passed Assembly / S.7361 Referred to Corporation, Authori- ties and Commissions 2018: Passed Assembly / S.8637A Referred to Corporations   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: On the ninetieth day after it shall have become a law.
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A00213 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                           213
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                       (Prefiled)
 
                                     January 6, 2021
                                       ___________
 
        Introduced  by  M. of A. PAULIN, GALEF, ABINANTI, OTIS, JACOBSON -- read
          once and referred to the Committee on  Corporations,  Authorities  and
          Commissions
 
        AN  ACT  to  amend  the  not-for-profit  corporation law, in relation to
          voting requirements of the board of certain corporations

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  The  opening paragraph of paragraph (a) of section 902 of
     2  the not-for-profit corporation law is amended to read as follows:
     3    The board of each corporation proposing to participate in a merger  or
     4  consolidation under section 901 (Power of merger or consolidation) shall
     5  adopt,  by  a vote of two-thirds of the directors present at the time of
     6  the vote, if a quorum is present at that time,  or  by  a  vote  of  the
     7  number  of  directors  required  under the certificate of incorporation,
     8  by-laws, this chapter and any other applicable law, a plan of merger  or
     9  consolidation, setting forth:
    10    §  2.  Subparagraph 1 of paragraph (a) of section 1002 of the not-for-
    11  profit corporation law, as amended by chapter 549 of the laws  of  2013,
    12  is amended to read as follows:
    13    (1) In the case of a vote by the board of directors: (i) the number of
    14  directors required under the certificate of incorporation, by-laws, this
    15  chapter and any other applicable law; [or]
    16    (ii) two-thirds of the directors present at the time of the vote, if a
    17  quorum is present at that time; or
    18    (iii)  if  the  number of directors actually holding office as such at
    19  the time of the vote to adopt the plan is less than the number  required
    20  to  constitute  a  quorum of directors under the certificate of incorpo-
    21  ration, the by-laws, this chapter  or  any  other  applicable  law,  the
    22  remaining directors unanimously;
    23    §  3.  This  act shall take effect on the ninetieth day after it shall
    24  have become a law.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD01795-01-1
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A00213 LFIN:

 NO LFIN
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