State Legislative Updates

New York Assembly Bill 434

New York — Assembly Bill 434, effective October 23, 2019, amends Sec. 602 of the Business Corporation Law to provide that a corporation may, if authorized by the board of directors: (1) implement reasonable measures to provide shareholders not physically present at a shareholders' meeting a reasonable opportunity to participate in the proceedings of the meeting substantially concurrently with such proceedings; and/or (2) provide reasonable measures to enable shareholders to vote or grant proxies with respect to matters submitted to the shareholders at a shareholders' meeting by means of electronic communication. The bill also requires the corporation to (A) implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of electronic communication is a shareholder of record and (B) keep a record of any vote or other action taken by a shareholder participating and voting by means of electronic communications at a shareholders' meeting.

A shareholder participating in a shareholders' meeting by this means is deemed to be present in person at the meeting. "Reasonable measures" with respect to participating in proceedings includes audio webcast or other broadcast of the meeting, and for voting includes telephonic and internet voting.

Sec. 605, regarding notice of meetings of shareholders was amended to provide that the notice shall state the means of electronic communications, if any, by which shareholders and proxyholders may participate in the proceedings of the meeting and vote or grant proxies at the meeting.

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