Utah Code 48-4-201. Company purpose

48-4-201. Company purpose.

(1)	In addition to the benefit company‘s purpose under Section 48-3a-104, a benefit company shall have a purpose of creating general public benefit.

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Terms Used In Utah Code 48-4-201

Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
Benefit company: means a limited liability company:

(a)	that elects to become subject to this chapter; and

(b)

the status of which as a benefit company has not been terminated. See Utah Code 48-4-103

General public benefit: means a material positive impact on society and the environment:

(a)	taken as a whole;

(b)	assessed against a third-party standard; and

(c)

from the business of a benefit company. See Utah Code 48-4-103

Minimum status vote: means :

(a)

in the case of a limited liability company, in addition to any other required approval or vote, the satisfaction of the following conditions:

(i)	the members of every class or series may vote as a separate voting group on an action of the limited liability company regardless of a limitation state in the certificate of organization or operating agreement on the voting rights of any class or series; and

(ii)	the action of the limited liability company is required to be approved by vote of the members of each class or series entitled to cast at least two-thirds of the votes that all members of the class or series are entitled to cast on the action; or

(b)

in the case of a domestic entity other than a limited liability company, in addition to any other required approval, vote, or consent, the satisfaction of the following conditions:

(i)	the holders of every class or series of interest in the entity that are entitled to receive a distribution of any kind from the entity may vote on or consent to the action regardless of any otherwise applicable limitation on voting or consent rights of the class or series; and

(ii)

the action of the limited liability company is required to be approved by vote or consent of the holders described in Subsection (6)(b)(i) entitled to cast at least two-thirds of the votes or consents that all of those holders are entitled to cast on the action. See Utah Code 48-4-103

Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.

Specific public benefit: includes :

(a)	providing low-income or underserved individuals or communities with beneficial products or services;

(b)	promoting economic opportunity for individuals or communities beyond the creation of jobs in the normal course of business;

(c)	protecting or restoring the environment;

(d)	improving human health;

(e)	promoting the arts, sciences, or advancement of knowledge;

(f)	increasing the flow of capital to entities with a purpose to benefit society or the environment; and

(g)

conferring any other particular benefit on society or the environment. See Utah Code 48-4-103

(2)

(a)	A benefit company’s certificate of organization may identify one or more specific public benefits that are the purposes of the benefit company to create.

(b)	Identifying a specific public benefit in accordance with Subsection (2)(a) does not affect a benefit company’s obligation to create general public benefit in accordance with Subsection (1).

(3)	The creation of general public benefit and one or more specific public benefits is in the best interests of the benefit company.

(4)

(a)	A benefit company may amend the benefit company’s certificate or organization to add, amend, or delete a specific public benefit.

(b)	An amendment described in Subsection (4)(a) is not effective unless adopted by at least the minimum status vote.

Enacted by Chapter 201, 2018 General Session

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