SB 285

This bill allows shareholders of a business corporation to participate in

shareholders' meetings by means of remote communication, without being

physically present at the meeting.

Under current law, with an exception, a corporation must hold an annual

meeting of shareholders at a time and place stated in or fixed in accordance with its

bylaws. If no place is so stated, the annual meeting is held at the corporation's

principal office. A corporation may also hold special shareholders' meetings at the

place stated in or fixed in accordance with its bylaws or, if none, at the corporation's

principal office. Before a shareholders' meeting, a corporation must prepare a list

of the names of all its shareholders entitled to notice of the meeting. The corporation

must make this list available for inspection by any shareholder, for a certain period,

at the corporation's principal office or at a place identified in the meeting notice in

the city where the meeting will be held. The corporation must also make the list

available for shareholder inspection during the meeting.

Under this bill, a corporation's board of directors may allow shareholders not

physically present at a shareholders' meeting to participate in the meeting by means

of remote communication and to be considered to be present in person and to vote at

the meeting, if the corporation 1) has implemented reasonable measures to verify

that each person considered to be present and permitted to vote at the meeting by

means of remote communication is a shareholder; 2) has implemented reasonable

measures to provide shareholders a reasonable opportunity to participate in the

meeting and to vote on matters submitted to the shareholders, including an

opportunity to read or hear the proceedings of the meeting concurrently with the

proceedings; and 3) maintains a record of voting or action by shareholders by means

of remote communication. These provisions also apply to proxies of shareholders.

A corporation's bylaws may allow the board of directors to determine that

shareholders' meetings are held solely by means of remote communication, and the

provisions described above apply regardless of whether the meeting is held at a

designated place or solely by means of remote communication. If the board of

directors has allowed participation by means of remote communication, the

corporation's notice to shareholders of the shareholders' meeting must describe the

means of remote communication to be used.

The bill also allows a corporation to make its shareholders' list available on a

reasonably accessible electronic network, instead of making it available at the

corporation's principal office or at a place identified in the meeting notice. If the

corporation elects to make its shareholders list available on a reasonably accessible

electronic network, the information required to gain access to the list must be

provided with the meeting notice. If a shareholders' meeting is held solely by means

of remote communication, the shareholders' list must be available on a reasonably

accessible electronic network during the meeting.