Corporations act-amendments.

Plain English Breakdown

The plain English breakdown is still being put together. The official documents below are already here.

Official Summary Text

Bill No.: <billno> Drafter: <drafterinit>

Bill No.:
SF0072
Drafter:

LGC

LSO No.:
09LSO-0128
Effective Date:

7/1/2009

Enrolled Act No.:
SEA0053

Chapter No.:
115

Prime Sponsor:
Joint
Corporations, Elections and Political Subdivisions Interim Committee

Catch Title:
Corporations
act-amendments.

Subject:
Amends
general corporations law.

Summary/Major Elements:

Article
1 of the Wyoming Business Corporation Act sets general administrative
provisions and definitions of terms used in the Act. The act allows and
facilitates electronic filing, electronic signing and other electronic
transmissions. The act makes the date a document is received by the Secretary
of State the effective date. There are several proposed revisions to the
definition section to conform the Wyoming Corporations Act with the Model Act.

Article
4 governs corporate names in Wyoming. These statutes prevent corporations from
using names that are identical to existing corporate names, or names that are
so similar as to be indistinguishable. The act provides that where a new corporation
is affiliated with an existing Wyoming corporation, the two corporations have proposed
to merge or consolidate and the existing corporation has consented in writing
to the use of the name by the new corporation, the new and existing corporations
may use the same name for no more than 120 days.

Most of
the changes in Article 6 reflect the Model Acts adoption of new terminology to
reflect changes in the rights associated with various types of stock. The
historic distinctions between common shares and preferred shares have
become blurred as companies have created various classes and series of stock
which combine the attributes of both types of shares. The act acknowledges this
practice and adopts more general language which permits broad flexibility in
the creation of various types of shares.

Article
7 sets forth the basic rights of shareholders in a corporation and describes
the conduct of meetings and business. The act clarifies procedures for
shareholders to take action by written consent rather than holding a
shareholders meeting and allows notice to non-voting shareholders of action
taken by written consent to be sent after written consents are received rather
than before action is taken. A major change from current Wyoming law would allow
articles of incorporation to provide for action without a meeting when approved
by the minimum number of votes required to authorize the action, even if not
unanimous.

Article
8 of the act addresses the duties and requirements of directors and officers of
corporations. Current Wyoming law provides that directors may increase or
decrease the number of directors by no more than 30%. Shareholders must consent
to increases or decreases to the number of directors of more than 30%. The act
eliminates the 30% requirement in favor of allowing changes to the number of
directors in any manner provided in the corporations articles of
incorporation. The act eliminates a committees ability to amend articles of
incorporation or approve a merger plan without shareholder approval. The most
significant changes to Article 8 address the statutory standards imposed on
directors and officers. A new subarticle from the Model Act is added, defining
and governing directors conflicting interest transactions. The subarticle
protects directors from certain liabilities that might arise as result of the
director taking advantage of business opportunities.

Article
10 deals with the process of amending the articles of incorporation and/or the
bylaws of a corporation. The act clarifies that the board of directors,
without a shareholder vote, may increase the number of authorized shares of a
corporation to the extent necessary to allow a share dividend (which the
directors have sole authority to declare). Unless the articles provide
otherwise, a shareholder vote now need only be by a majority of the
shareholders at a meeting where a quorum is present.

Article 11 deals with mergers and share exchanges.
Generally, the changes
organize the law of mergers and share exchanges for all business entities into
one article, and provide more direction and clarity on the merger and share
exchange process.

Article 12 deals with the sale of assets.
The act requires shareholder
approval of a disposition of assets if after the sale, it would leave the
corporation without a significant continuing business activity, or at least 25%
of its total assets. The act provides more clarity on the process to be
followed when shareholder approval of dispositions is required.

Article
13 deals with what the statutes previously called Dissenters Rights, but now
calls Appraisal Rights. The act adopts most of the model act recommendations
regarding appraisal rights.

Article 14 deals with dissolution.
The act simplifies the
dissolution process, provides further direction regarding the effect of a
dissolution, provides for an additional procedure through which a corporation
may limit claims and prohibits filing of documents without proper authority.

Less substantive changes were made throughout Title 17
to update statutory language to reflect the 2007 model act.