On August 4, 2022, the Fourth Department issued a decision in Salansky v. Empric, 2022 NY Slip Op. 04844, holding that shareholders may require unanimous consent to amend a certificate of incorporation even though the BCL requires only majority consent, explaining:
We agree with plaintiff that the court erred in granting those parts of defendants’ motion seeking summary judgment dismissing the first cause of action insofar as it alleges breach of the shareholder agreement as asserted by plaintiff, individually, and the third cause of action insofar as it was asserted by plaintiff, individually, and that plaintiff is entitled to partial summary judgment on those causes of action, and we therefore modify the order accordingly. It is well settled that a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms. Section four of the shareholder agreement provided that the CI will not be amended or repealed except by written Agreement of all of the Shareholders. In opposition to the motion, plaintiff submitted an amendment to the CI made in September 2020 to increase the number of shares that BFI was authorized to issue from 200 shares to 2,000. The amendment to the CI stated that the amendment was authorized by a vote of a majority of all outstanding shares entitled to vote thereon. Thus, plaintiff established that defendants violated the shareholder agreement by amending the CI without his written approval.
Contrary to defendants’ assertion, we conclude that section four of the shareholder agreement does not conflict with Business Corporation Law § 803 (a). That statute provides, inter alia, that a certificate of incorporation may be amended by a simple majority vote of the shares present at a meeting of the shareholders. If the certificate of incorporation itself requires a greater number than a majority vote for an amendment, then that provision cannot be changed except by such greater vote. There was no provision in the CI here that required a vote of all the shareholders in order to amend the CI, and thus it could be amended by a simple majority vote of the shareholders. However, plaintiff alleged that defendants violated the shareholder agreement by amending the CI without his approval. Business Corporation Law § 803 (a) does not prohibit parties from entering into a separate agreement that requires unanimity among the shareholders to amend a certificate of incorporation. Inasmuch as there is no conflict between the Business Corporation Law and the shareholder agreement, section 41 of the shareholder agreement, which provides that when there is such a conflict the Business Corporation Law will prevail, is not applicable to the issue.
(Internal quotations and citations omitted).