Bill Text: NY A03514 | 2019-2020 | General Assembly | Amended
Bill Title: Provides for expanded ownership in design professional corporations by employee stock ownership plans and non-licensed employees.
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2020-03-12 - print number 3514b [A03514 Detail]
Download: New_York-2019-A03514-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 3514--B 2019-2020 Regular Sessions IN ASSEMBLY January 29, 2019 ___________ Introduced by M. of A. LUPARDO, SCHIMMINGER, THIELE, JOHNS, SANTABAR- BARA, MANKTELOW -- Multi-Sponsored by -- M. of A. CROUCH, McDONOUGH, B. MILLER -- read once and referred to the Committee on Higher Educa- tion -- recommitted to the Committee on Higher Education in accordance with Assembly Rule 3, sec. 2 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee -- again reported from said committee with amendments, ordered reprinted as amended and recommitted to said committee AN ACT to amend the business corporation law, in relation to providing for expanded ownership in design professional corporations by employee stock ownership plans and non-licensed employees The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subparagraphs (i) and (ii) of paragraph (b-1) of section 2 1503 of the business corporation law, as added by chapter 550 of the 3 laws of 2011, are amended to read as follows: 4 (i) greater than seventy-five percent of the outstanding shares of 5 stock of the corporation are owned by design professionals and an ESOP 6 (or ESOPs) with greater than seventy-five percent of the plan's voting 7 trustees and greater than seventy-five percent of the plan's committee 8 members being design professionals, 9 (ii) an ESOP, either in part or in its entirety, shall not constitute 10 part of the greater than seventy-five percent owned by design profes- 11 sionals unless greater than seventy-five percent of the plan's voting 12 trustees and greater than seventy-five percent of the plan's committee 13 members are design professionals, 14 § 2. Subparagraphs (i) and (ii) of paragraph (b) of section 1507 of 15 the business corporation law, as added by chapter 550 of the laws of 16 2011, are amended to read as follows: 17 (i) greater than seventy-five percent of the outstanding shares of 18 stock of the corporation are owned by design professionals and an ESOP EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03292-12-0A. 3514--B 2 1 (or ESOPs) with greater than seventy-five percent of the plan's voting 2 trustees and greater than seventy-five percent of the plan's committee 3 members being design professionals, 4 (ii) an ESOP, either in part or in its entirety, shall not constitute 5 part of the greater than seventy-five percent owned by design profes- 6 sionals unless greater than seventy-five percent of the plan's voting 7 trustees and greater than seventy-five percent of the plan's committee 8 members are design professionals, 9 § 3. Subparagraph (i) of paragraph (b) of section 1514 of the business 10 corporation law, as added by chapter 550 of the laws of 2011, is amended 11 to read as follows: 12 (i) greater than seventy-five percent of the outstanding shares of 13 stock of the corporation are and were owned by design professionals and 14 an ESOP (or ESOPs) with greater than seventy-five percent of the plan's 15 voting trustees and greater than seventy-five percent of the plan's 16 committee members being design professionals, 17 § 4. Paragraph (a) of section 1505 of the business corporation law, as 18 amended by chapter 550 of the laws of 2011, is amended to read as 19 follows: 20 (a) (i) Each shareholder, employee or agent of a professional service 21 corporation and a design professional service corporation shall be 22 personally and fully liable and accountable for any negligent or wrong- 23 ful act or misconduct committed by him or by any person under his direct 24 supervision and control while rendering professional services on behalf 25 of such corporation. 26 (ii) An employee stock ownership plan owning greater than twenty-five 27 percent of the outstanding shares of a design professional service 28 corporation organized under paragraph (b-1) of section fifteen hundred 29 three of this article shall be under the supervision of the regents of 30 the university of the state of New York and be subject to disciplinary 31 proceedings and penalties, and its authority to hold shares of such 32 corporation shall be subject to suspension, revocation or annulment for 33 cause, in the same manner and to the same extent as is provided with 34 respect to individuals and their licenses, certificates, and registra- 35 tions in title eight of the education law relating to the applicable 36 profession. 37 § 5. Subparagraphs (v) and (vi) of paragraph (b-1) of section 1503 of 38 the business corporation law, as added by chapter 550 of the laws of 39 2011, are amended and a new subparagraph (vii) is added to read as 40 follows: 41 (v) the president, the chairperson of the board of directors and the 42 chief executive officer or officers are design professionals, [and] 43 (vi) the single largest shareholder is either a design professional or 44 an ESOP with greater than seventy-five percent of the plan's voting 45 trustees being design professionals and greater than seventy-five 46 percent of the plan's committee members being design professionals[.], 47 and 48 (vii) notwithstanding any other provision of law, not less than five 49 percent of the outstanding shares of stock of the corporation shall be 50 owned by design professionals. 51 § 6. Subparagraphs (v) and (vi) of paragraph (b) of section 1507 of 52 the business corporation law, as added by chapter 550 of the laws of 53 2011, are amended and a new subparagraph (vii) is added to read as 54 follows: 55 (v) the president, the chairperson of the board of directors and the 56 chief executive officer or officers are design professionals, [and]A. 3514--B 3 1 (vi) the single largest shareholder is either a design professional or 2 an ESOP with greater than seventy-five percent of the plan's voting 3 trustees being design professionals and greater than seventy-five 4 percent of the plan's committee members being design professionals[.], 5 and 6 (vii) notwithstanding any other provision of law, not less than five 7 percent of the outstanding shares of stock of the corporation shall be 8 owned by design professionals. 9 § 7. Subparagraphs (iv) and (v) of paragraph (b) of section 1514 of 10 the business corporation law, as added by chapter 550 of the laws of 11 2011, are amended and a new subparagraph (vi) is added to read as 12 follows: 13 (iv) the president, the chairperson of the board of directors and the 14 chief executive officer or officers are and were design professionals, 15 [and] 16 (v) the single largest shareholder is and was either a design profes- 17 sional or an ESOP with greater than seventy-five percent of the plan's 18 voting trustees being design professionals and greater than seventy-five 19 percent of the plan's committee members being design professionals[.], 20 and 21 (vi) notwithstanding any other provision of law, not less than five 22 percent of the outstanding shares of stock of the corporation are and 23 were owned by design professionals. 24 § 8. This act shall take effect immediately.