https://minnesotalawyer.com/statutes/chapter-304a/Recent content in Chapter 304A — Minnesota Public Benefit Corporation Act on MinnesotaLawyer.comHugoen-ushttps://minnesotalawyer.com/statutes/chapter-304a/304a.001/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.001/This section establishes the official short title for the law governing public benefit corporations in Minnesota. The chapter may be cited as the ‘Minnesota Public Benefit Corporation Act.’ Public benefit corporations are for-profit businesses that are legally required to pursue social or environmental goals in addition to profit.https://minnesotalawyer.com/statutes/chapter-304a/304a.011/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.011/This section clarifies how public benefit corporation law relates to the general Minnesota business corporation law in chapter 302A. Chapter 302A’s rules apply to public benefit corporations unless they conflict with chapter 304A, in which case chapter 304A controls. Importantly, no provision in a public benefit corporation’s articles or bylaws may override or reduce the requirements of this chapter.https://minnesotalawyer.com/statutes/chapter-304a/304a.021/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.021/This section defines key terms used in the Minnesota Public Benefit Corporation Act. A ‘general benefit corporation’ pursues broad positive impacts on society and the environment. A ‘specific benefit corporation’ commits to one or more particular public benefit goals stated in its articles. ‘General public benefit’ means a net positive material impact on society, the environment, and future generations. ‘Independent’ describes persons with no material relationship to the company.https://minnesotalawyer.com/statutes/chapter-304a/304a.101/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.101/A public benefit corporation must be formed under Minnesota’s general business corporation law in chapter 302A, with its articles of incorporation also stating whether it is a general benefit corporation (GBC) or a specific benefit corporation (SBC). General benefit corporations must include ‘GBC’ or ‘general benefit corporation’ in their name, and specific benefit corporations must include ‘SBC’ or ‘specific benefit corporation’ in their name.https://minnesotalawyer.com/statutes/chapter-304a/304a.102/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.102/An existing Minnesota corporation can convert to public benefit corporation status by amending its articles with approval of the minimum status vote, which requires both board approval and shareholder approval by a specific threshold. A merger, conversion, or asset transfer that results in a public benefit corporation also requires this heightened vote. Shareholders who disagree with the conversion may exercise dissenters’ rights and receive the fair value of their shares in cash.https://minnesotalawyer.com/statutes/chapter-304a/304a.103/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.103/A public benefit corporation can end its benefit corporation status by amending its articles to remove the public benefit language and name requirements, using the same heightened minimum status vote required to become one. Shareholders who oppose ending the public benefit status have dissenters’ rights. A company that terminates or has its status revoked more than once cannot re-elect public benefit corporation status for three years.https://minnesotalawyer.com/statutes/chapter-304a/304a.104/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.104/A general benefit corporation’s primary purpose is to create positive impact on society and the environment. A specific benefit corporation must pursue the particular social or environmental purpose stated in its articles. Both types may also pursue other lawful business purposes. Pursuing public benefit is considered in the best interest of the company. A general benefit corporation can add or change a specific benefit purpose, but only if doing so does not terminate its public benefit status.https://minnesotalawyer.com/statutes/chapter-304a/304a.201/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.201/Directors of a general benefit corporation must consider how their decisions affect the company’s ability to pursue general public benefit and any stated specific benefit, as well as the interests of shareholders, employees, customers, communities, and the environment. Directors may not give automatic priority to shareholder profit over all other considerations. Directors of a specific benefit corporation must consider the company’s ability to achieve its stated specific benefit purpose in the same way.https://minnesotalawyer.com/statutes/chapter-304a/304a.202/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.202/Only shareholders of a public benefit corporation may sue the company, its directors, or officers for failure to pursue or create public benefit. The company itself cannot be sued for monetary damages for failing to create public benefit. A court may provide non-monetary relief if directors have substantially and persistently violated their public benefit duties, or if the company has failed to pursue its stated purpose for an unreasonably long time.https://minnesotalawyer.com/statutes/chapter-304a/304a.301/Mon, 01 Jan 0001 00:00:00 +0000https://minnesotalawyer.com/statutes/chapter-304a/304a.301/Every public benefit corporation must file an annual benefit report with the Secretary of State by April 1 each year covering the prior calendar year, and pay a $35 fee. The report must describe the ways the company pursued and created public benefit during the year, any obstacles encountered, and be certified by the board of directors. General benefit corporations must also report against a third-party standard for measuring social and environmental performance.