Business Law Update
The New Hampshire Senate recently approved SB 41, the first revision to the Business Corporation Act(RSA 293-A) since it was implemented in 1993. Included in the bill are several provisions that address developments in technology. These provisions allow for electronic transmission of corporate notices and the remote participation by shareholders at Annual and Special meetings.
Other notable changes to the Act include the following:
(1) new provisions regarding the issuance of shares, the exercise of options, and shareholders’ preemptive rights;
(2) clarification regarding who may serve as registered agent;
(3) provisions regarding the use of consents in lieu of Annual meetings;
(4) additional requirements regarding the use of written consents for corporate actions;
(5) creation of a presiding “Chair” for shareholder meetings, powers of the Chair and its rule-making capabilities;
(6) provisions addressing the ability to change the number of directors, the director standard of care and director conflict of interest transactions;
(7) new provisions regarding mergers, exchanges, sales of assets, dissenters’ rights, dissolution, the inspection of records and annual reporting to the Secretary of State; and
(8) the creation of a new chapter dedicated to the conversion of various business entities.
The bill does not address issues that exist when initially registering a business name. Currently, the Secretary of State has complete discretion when determining whether a new business name can be easily distinguished from an existing business name. The results can be inconsistent. Similarly, HB 222, which sought to revise the current language of the statute, was retained in committee where House members intend to continue their work.
Sulloway & Hollis is dedicated to keeping its clients informed of changes to the law. If you have questions regarding the new LLC Act, forming a business entity, creating or amending bylaws, a shareholder agreement, or compensation plan, please contact our Business and Private Clients Practice Group.