Corporations

Passed

P HB1829

Names of business entities; emergency. Clarifies that the words permitted to be in a business trust name pursuant to the Business Trust Act can be considered in determining whether a corporate, limited liability company, business trust or limited partnership name is distinguishable from the names of other such entities that have been recorded, reserved or registered in the office of the clerk of the State Corporation Commission. If the name of a corporation that has ceased to exist is not distinguishable from that of another entity, it shall change its name upon reinstatement to one that is distinguishable before engaging in business. The measure also narrows existing cross-references and makes technical corrections.
Patron - Parrish

P SB933

Limited liability companies. Establishes a procedure for the filing of articles of restatement of a limited liability company as adopted by its members, managers, or persons who formed the limited liability company. Other provisions (i) clarify that limited liability company operating agreements may contain provisions benefiting third parties; (ii) allow a successor in interest to the last member of a limited liability company to provide for the continuation of the limited liability company and the designation of a new member; (iii) clarify that the articles of organization or operating agreement may provide that a membership interest consists only of non-economic rights; and (iv) provide that existing civil immunity protections available to principals of certain tax-exempt organizations apply to principals of tax-exempt partnerships and limited liability companies. The measure also includes several technical corrections.
Patron - Stosch

P SB1228

Stock Corporation Act. Updates the Virginia Stock Corporation Act to incorporate refinements to the Revised Model Business Corporation Act that have been adopted by the Business Law Section of the American Bar Association since its Model Act was enacted by Virginia. Substantive changes include permitting several corporate actions to be taken electronically; confirming that provisions in corporate documents filed with the State Corporation Commission may be made dependent on statistical or market indices or other objectively ascertainable facts; making the process for amending articles of incorporation more flexible; streamlining the process for combining corporations with other types of business entities; expanding situations where a shareholder can exercise appraisal rights; revising the test for determining whether a sale of corporate assets requires shareholder approval; establishing a shareholder buy-out alternative to court-ordered dissolution; and establishing a process for resolving contingent liabilities of a dissolving corporation. The measure also provides that, unless provided for in the articles of incorporation, shareholders of a corporation incorporated after December 31, 2005, will have no preemptive right to purchase the corporation's unissued shares.
Patron - Stosch

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