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A01237 Summary:

BILL NOA01237
 
SAME ASSAME AS S01182
 
SPONSORPaulin
 
COSPNSR
 
MLTSPNSR
 
Amd §§708 & 602, BC L; amd §§603 & 605, N-PC L; amd §28, Rel Corp L; amd §6, Chap 122 of 2020
 
Provides for the remote conduct of certain practices and procedures relating to board meetings utilizing electronic and/or audio-visual technologies; makes permanent provisions relating to providing for the remote conduct of certain practices and procedures relating to board meetings.
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A01237 Actions:

BILL NOA01237
 
01/07/2021referred to corporations, authorities and commissions
04/26/2021reported
04/29/2021advanced to third reading cal.243
05/04/2021passed assembly
05/04/2021delivered to senate
05/04/2021REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
06/08/2021SUBSTITUTED FOR S1182
06/08/20213RD READING CAL.1070
06/08/2021PASSED SENATE
06/08/2021RETURNED TO ASSEMBLY
10/27/2021delivered to governor
11/08/2021signed chap.588
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A01237 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          1237
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                     January 7, 2021
                                       ___________
 
        Introduced by M. of A. PAULIN -- read once and referred to the Committee
          on Corporations, Authorities and Commissions
 
        AN  ACT to amend the business corporation law, the not-for-profit corpo-
          ration law, and the religious corporations law, in relation to provid-
          ing for the remote conduct of certain practices and procedures  relat-
          ing  to  board meetings; and to amend chapter 122 of the laws of 2020,
          amending the business corporation law, the not-for-profit  corporation
          law,  and the religious corporations law relating to providing for the
          remote conduct of certain practices and procedures relating  to  board
          meetings, in relation to the effectiveness thereof
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Paragraph (b) of section 708 of  the  business  corporation
     2  law,  as  amended by chapter 122 of the laws of 2020, is amended to read
     3  as follows:
     4    (b) Unless otherwise restricted by the certificate of incorporation or
     5  the by-laws, any action required or permitted to be taken by  the  board
     6  or  any  committee thereof may be taken without a meeting if all members
     7  of the board or the committee consent in writing to the  adoption  of  a
     8  resolution  authorizing  the  action.  The  resolution  and  the written
     9  consents thereto by the members of the board or committee shall be filed
    10  with the minutes of the proceedings of the board or committee. [For  the
    11  duration of the state disaster emergency declared by executive order two
    12  hundred  two  that began on March seventh, two thousand twenty, notwith-
    13  standing] Notwithstanding any provision of  law  to  the  contrary,  the
    14  written  consent  of  a  member  may  be made electronically, where such
    15  consent is submitted via electronic mail, text, or other  secured  plat-
    16  form for electronic communications, along with information from which it
    17  can  be  reasonably  determined  that the transmission was authorized by
    18  such member.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05075-01-1

        A. 1237                             2
 
     1    § 2. Paragraph (a) of section 602 of the business corporation law,  as
     2  amended  by  chapter  122  of  the  laws  of 2020, is amended to read as
     3  follows:
     4    (a)  Meetings  of  shareholders  may  be held at such place, within or
     5  without this state, as may be fixed by or under the by-laws, or  if  not
     6  so  fixed, as determined by the board of directors. [For the duration of
     7  the state disaster emergency declared by executive order two hundred two
     8  that began on March seventh, two thousand twenty, if]  If,  pursuant  to
     9  this paragraph or the by-laws of the corporation, the board of directors
    10  is  authorized  to determine the place of a meeting of shareholders, the
    11  board of directors may, in its sole discretion, determine that the meet-
    12  ing  be  held  solely  by  means  of   electronic   communication,   the
    13  platform/service  of which shall be the place of the meeting for purpose
    14  of this article.
    15    § 3. Paragraph (a) of section 603 of  the  not-for-profit  corporation
    16  law,  as  amended by chapter 122 of the laws of 2020, is amended to read
    17  as follows:
    18    (a) Meetings of members may be held at such place, within  or  without
    19  this state, as may be fixed by or under the by-laws or, if not so fixed,
    20  as  determined by the board of directors. [For the duration of the state
    21  disaster emergency declared by executive  order  two  hundred  two  that
    22  began on March seventh, two thousand twenty, the] The board of directors
    23  may,  unless otherwise restricted by the certificate of incorporation or
    24  the by-laws, in its sole discretion, determine that meetings of  members
    25  be  held  partially  or solely by means of electronic communication, the
    26  electronic service and/or platform by which the meeting is held shall be
    27  the place of the meeting for purposes of this article if  a  meeting  is
    28  held  solely  by  means  of electronic communication. Meetings conducted
    29  partially or solely by means of electronic  communications  in  reliance
    30  upon  this  paragraph  and any member's electronic participation in such
    31  meetings shall be subject to those  guidelines  and  procedures  as  the
    32  board adopts, provided the board shall implement reasonable measures to:
    33  (1)  verify that each person participating electronically is a member or
    34  a proxy of a member; (2) provide  each  member  participating  electron-
    35  ically  with  a  reasonable  opportunity  to participate in the meeting,
    36  including an opportunity to propose, object to, and vote upon a specific
    37  action to be taken by  the  members,  and  to  see,  read  or  hear  the
    38  proceedings   of  the  meeting  substantially  concurrently  with  those
    39  proceedings; and (3) record and maintain a record of any votes or  other
    40  actions taken by electronic communication at the meeting.
    41    §  4. Section 605 of the not-for-profit corporation law, as amended by
    42  chapter 122 of the laws of 2020, is amended to read as follows:
    43  § 605. Notice of meeting of members.
    44    (a) Whenever under the provisions of this chapter members are required
    45  or permitted to take any action at a meeting, written notice shall state
    46  the place, date and hour of the meeting, [for the duration of the  state
    47  disaster  emergency  declared  by  executive  order two hundred two that
    48  began on March seventh, two thousand twenty,] the  means  of  electronic
    49  communication,   if  any,  by  which  members  may  participate  in  the
    50  proceedings of the meeting pursuant to  paragraph  (a)  of  section  six
    51  hundred three of this article and, unless it is an annual meeting, indi-
    52  cate  that  it  is  being issued by or at the direction of the person or
    53  persons calling the meeting. Notice of  a  special  meeting  shall  also
    54  state the purpose or purposes for which the meeting is called. A copy of
    55  the  notice  of  any  meeting shall be given, personally, by mail, or by
    56  facsimile telecommunications or by electronic mail, to each member enti-

        A. 1237                             3
 
     1  tled to vote at such meeting. If the  notice  is  given  personally,  by
     2  first  class  mail  or  by facsimile telecommunications or by electronic
     3  mail, it shall be given not less than  ten  nor  more  than  fifty  days
     4  before the date of the meeting; if mailed by any other class of mail, it
     5  shall be given not less than thirty nor more than sixty days before such
     6  date.  If  mailed,  such  notice  is  given when deposited in the United
     7  States mail, with postage thereon prepaid, directed to the member at his
     8  address as it appears on the record of members, or,  if  he  shall  have
     9  filed  with  the  secretary  of  the  corporation a written request that
    10  notices to him be mailed to some other address, then directed to him  at
    11  such  other  address.  If  sent by facsimile telecommunication or mailed
    12  electronically, such notice is given when directed to the  member's  fax
    13  number  or  electronic  mail  address  as  it  appears  on the record of
    14  members, or, to such fax number or  other  electronic  mail  address  as
    15  filed with the secretary of the corporation. Notwithstanding the forego-
    16  ing,  such  notice shall not be deemed to have been given electronically
    17  (1) if the corporation is unable to deliver two consecutive  notices  to
    18  the member by facsimile telecommunication or electronic mail; or (2) the
    19  corporation  otherwise  becomes aware that notice cannot be delivered to
    20  the member by facsimile telecommunication or electronic mail. An affida-
    21  vit of the secretary or other person giving the notice or of a  transfer
    22  agent  of  the  corporation that the notice required by this section has
    23  been given shall, in the absence of fraud, be prima  facie  evidence  of
    24  the  facts  therein  stated.  Whenever  a corporation has more than five
    25  hundred members, the notice may be served by publication in a  newspaper
    26  published  in  the  county in the state in which the principal office of
    27  the corporation is located, once a week for three successive weeks  next
    28  preceding  the  date of the meeting, provided that the corporation shall
    29  also prominently post notice of such meeting  on  the  homepage  of  any
    30  website  maintained  by  the  corporation  continuously from the date of
    31  publication through the date of the meeting. A  corporation  shall  send
    32  notice  of  meetings  by  first class mail to any member who requests in
    33  writing that such notices be delivered by such method.
    34    (b) When a meeting is adjourned to another time or place, it shall not
    35  be necessary, unless the by-laws require otherwise, to give  any  notice
    36  of  the  adjourned meeting if the time and place to which the meeting is
    37  adjourned and[,  for  the  duration  of  the  state  disaster  emergency
    38  declared by executive order two hundred two that began on March seventh,
    39  two thousand twenty,] the means of electronic communications, if any, by
    40  which members may participate in the proceedings of the meeting pursuant
    41  to  paragraph  (a)  of  section  six  hundred  three of this article are
    42  announced at the meeting at which the adjournment is taken, and  at  the
    43  adjourned  meeting  any  business may be transacted that might have been
    44  transacted on the original date of the meeting. However,  if  after  the
    45  adjournment the board fixes a new record date for the adjourned meeting,
    46  a  notice  of  the  adjourned  meeting  shall be given to each member of
    47  record on the new record date entitled to notice under paragraph (a)  of
    48  this section.
    49    (c)  Nothing  required  in paragraphs (a) or (b) of this section shall
    50  limit, restrict or supersede other forms of voting and participation.
    51    § 5. Section 28 of the religious corporations law, as added by chapter
    52  122 of the laws of 2020, is amended read as follows:
    53    § 28. [Meetings for the  duration  of  the  state  disaster  emergency
    54  declared by executive order two hundred two that began on March seventh,
    55  two  thousand  twenty; electronic communication. For the duration of the
    56  state disaster emergency declared by executive  order  two  hundred  two

        A. 1237                             4

     1  that began on March seventh, two thousand twenty, notwithstanding] Elec-
     2  tronic  meetings.   Notwithstanding any provision of law, certificate of
     3  incorporation or by-laws to the contrary, if the board of trustees of  a
     4  religious  corporation  is  authorized to determine the place of trustee
     5  meetings [or], corporate meetings, congregant  or  membership  meetings,
     6  the  board  of  trustees may, in its sole discretion, determine that the
     7  meeting shall be held solely by means of electronic  communication,  the
     8  electronic  service  and/or  platform  through which the meeting is held
     9  shall be the place of the meeting for purposes of this chapter.
    10    § 6. Section 6 of chapter 122 of the laws of 2020, amending the  busi-
    11  ness  corporation law, the not-for-profit corporation law, and the reli-
    12  gious corporations law relating to providing for the remote  conduct  of
    13  certain  practices and procedures relating to board meetings, is amended
    14  to read as follows:
    15    § 6. This act shall take effect immediately [and shall expire  and  be
    16  deemed repealed December 31, 2021].
    17    § 7. This act shall take effect immediately.
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