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AMERICAN UNIVERSITY BUSINESS LAW REVIEW
Vol. 2:1
supermajority voting provisions create greater lock-in for an FPC ’s special purpose than would be found in an L3C form, through provisions similar to those imposed by benefit corporation statutes. FPC shareholders also possess dissenters ’ rights, a concept rarely found in other specialized forms,115 though one of potentially less value than may initially appear. The FPC statute provides a substantial architecture for operating FPCs, which relies on an express grant of discretion to directors. These clear instructions on structure and decision-making contrast sharply with the L3C form. L3C adopters must design their governance arrangements individually by contract and will find no guidance in the statute on managing fiduciary obligations in a dual or multiple mission entity. The benefit corporation, as an incorporated form, provides an “off-the-rack ” set of operating structures quite similar to the FPC. Its grant of discretion to directors is, however, importantly distinct. FPC directors may choose to consider the special purposes articulated in its articles, along with the interests of shareholders, in making decisions. Benefit corporation directors are required to consider a laundry list of divergent interests in making their decisions and are thereby given virtually absolute discretion. To police FPCs, the statute relies exclusively on shareholders. To boost their effectiveness, shareholders are afforded uniquely comprehensive disclosures. Although the FPC statute takes several steps to reduce the burden of its disclosure requirements, they remain considerably more extensive than those demanded of benefit corporations and, again, involve no third-party standards. Few L3C statutes impose any disclosure requirements at all. Armed with detailed information about FPC operations and achievements, shareholders are empowered to enforce the obligations of FPCs and their fiduciaries through voting and litigation rights. These enforcement tools far surpass those of L3C investors. They are similar to the enforcement rights of benefit corporation shareholders, though not identical. Both forms require supermajority shareholder approval for change of status, but their litigation mechanisms can differ. FPC shareholders may pursue fiduciary 115. The California and South Carolina benefit corporation statutes do provide dissenters ’ rights. Those under the California statute are identical to the dissenters ’ rights under the FPC statute. See CAL. CORP. CODE § 14604. The South Carolina statute provides its appraisal-type remedy only for shareholders of for-profits who dissent from a conversion to a benefit corporation. See A277, 119th Gen. Assemb., Reg. Sess. (S.C. 2012) (to be codified at S.C. CODE ANN. § 33-38-230). The Washington Social Purpose Corporation statute also contains an appraisal provision. See WASH. REV. CODE ANN. § 23B.25.120 (2012).