AB867: Bill Text

LRB-5326/1

KSH:gf:jlb

1995 - 1996 LEGISLATURE

1995 Assembly BILL 867

February 7, 1996 - Introduced by Representatives Albers, Jensen, Baldus, Cullen, Duff, Goetsch, La Fave, Lazich, Schneiders, Springer, Urban, Walker, Wasserman and Ziegelbauer, cosponsored by Senators Darling, Farrow, Huelsman, Panzer, Rude, Shibilski and Welch. Referred to Committee on Insurance, Securities and Corporate Policy.

AB867,1,8 An Act to amend 180.0122 (1) (a), 180.0122 (1) (m), 180.0122 (1) (n), 180.0122 (1) (o), 180.0122 (1m) (intro.), 180.0202 (1) (c), 180.0202 (1) (d) 2., 180.0202 (1) (e) 2., 180.0601 (1), 180.0601 (2), 180.0602 (1) (b), 180.0602 (2) (c), 180.0602 (2) (d), 180.0603 (1), 180.0631 (3) (b) (intro.), 180.0701 (4) (intro.), 180.1002 (8) and 180.1622 (1) (f); to repeal and recreate 180.0631 (3) (b) (intro.); and to create 180.0103 (11e), 180.0122 (1m), 180.0602 (1) (c), 180.1002 (7m), 180.1002 (8m) and 180.1002 (8n) of the statutes; relating to: corporations that are investment companies.

Analysis by the Legislative Reference Bureau

This bill makes a number of changes relating to corporations that state in their articles of incorporation that they are registered, or are organized for the purpose of registering, as management investment companies under the federal investment company act of 1940 (investment companies). These changes include the following:

1. The bill permits investment companies to declare an indefinite number of authorized shares. Under current law, the articles of incorporation are currently required to specify the number of authorized shares. Similarly, current law requires that the articles of incorporation specify the number of shares of each class that the corporation is authorized to issue and the number of shares of each series of each class that the corporation is authorized to issue. This bill permits an investment company to specify an indefinite number of authorized shares and to specify that each class and each series of shares have an indefinite number of authorized shares in a class and shares in a series of a class. The bill permits the board of director's to declare an indefinite number of authorized shares without shareholder approval, unless the articles of incorporation provide otherwise.

2. The bill changes filing fees for investment companies that have authorized an indefinite number of shares and that file articles of incorporation, amendments of the articles of incorporation, restatements of articles of incorporation or articles of merger. Under current law, these fees are based on the number of authorized shares. Under the bill, for investment companies that have authorized an indefinite number of shares, the filing fee for articles of incorporation is $12,500. The formula for computing the filing fee for amendments to the articles of incorporation, restatements of the articles of incorporation or articles of merger are amended so that, if the amendment, restatement or articles of merger authorize an indefinite number of shares, the filing fee is based on $12,500, rather than the number of authorized shares.

3. The bill authorizes the board of directors of an investment company to change the corporate name of the investment company without shareholder approval, if the investment company notifies shareholders of the change in corporate name not less than 30 days before the effective date of the change. Under current law, shareholder approval would generally be required. The bill also allows a company that is registered, or organized for the purpose of registering, as a management investment company under the federal investment company act of 1940, to amend its articles of incorporation without shareholder approval to state that it is an investment company, making the company subject to the provisions contained in this bill.

4. The bill permits the board of directors of an investment company, to the extent provided in the articles of incorporation, to change the distinguishing designation of a class or series of shares, if the change does not affect the preferences, limitations and relative rights, in whole or in part, of the class or series. Under current law, shareholder approval would be required.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB867, s. 1 Section 1. 180.0103 (11e) of the statutes is created to read:

AB867,2,6 180.0103 (11e) "Investment company" means a corporation that is registered, or is organized for the purpose of registering, as a management investment company under 15 USC 80a-1 to 80a-64, if the corporation's articles of incorporation state that the corporation is registered or is organized for the purposes of registering as a management investment company under 15 USC 80a-1 to 80a-64.

AB867, s. 2 Section 2. 180.0122 (1) (a) of the statutes is amended to read:

AB867,3,3 180.0122 (1) (a) Articles of incorporation, 1 cent for each authorized share, except the minimum fee is $90 and the maximum fee is $10,000 and except that the fee for investment companies is determined under sub. (1m).

AB867, s. 3 Section 3. 180.0122 (1) (m) of the statutes is amended to read:

AB867,3,9 180.0122 (1) (m) Amendment of articles of incorporation, $40; plus 1 cent for each authorized share after the amendment, less a credit of 1 cent for each authorized share immediately before the amendment; except the maximum fee under this paragraph is $10,000 and except that the fee for investment companies is determined under sub. (1m).

AB867, s. 4 Section 4. 180.0122 (1) (n) of the statutes is amended to read:

AB867,3,16 180.0122 (1) (n) Restatement of articles of incorporation with or without amendment of articles, $40; plus 1 cent for each authorized share after the restatement and any amendment, less a credit of 1 cent for each authorized share immediately before the restatement and any amendment; except the maximum fee under this paragraph is $10,000 and except that the fee for investment companies is determined under sub. (1m).

AB867, s. 5 Section 5. 180.0122 (1) (o) of the statutes is amended to read:

AB867,3,24 180.0122 (1) (o) Articles of merger, $50 for each domestic corporation and each foreign corporation authorized to transact business in this state that is a party to the merger; plus 1 cent for each authorized share of the surviving domestic corporation after the merger, less a credit of 1 cent for each share that is authorized immediately before the merger by each domestic corporation that is a party to the merger; except the maximum fee under this paragraph is $10,000 and except that the fee for investment companies is determined under sub. (1m).

AB867, s. 6 Section 6. 180.0122 (1m) of the statutes is created to read:

AB867,4,3 180.0122 (1m) The secretary of state shall collect the following fees when the documents described in this subsection are delivered to him or her for filing by an investment company:

AB867,4,4 (a) Articles of incorporation; an amount determined as follows:

AB867,4,6 1. If the investment company declares an indefinite number of authorized shares, $12,500.

AB867,4,9 2. If the investment company does not declare an indefinite number of authorized shares, 1 cent for each authorized share, except the minimum fee under this subdivision is $90 and the maximum fee is $10,000.

AB867,4,13 (b) Amendment of articles of incorporation; $40, unless the amendment increases the number of authorized shares or declares an indefinite number of authorized shares, in which case an amount determined as follows shall be added to the $40 fee:

AB867,4,17 1. If the amendment increases the number of authorized shares, 1 cent for each authorized share after the amendment, less a credit of 1 cent for each authorized share immediately before the amendment; except the maximum fee under this subdivision is $10,000.

AB867,4,20 2. If the amendment declares an indefinite number of authorized shares, $12,500, less a credit of 1 cent for each authorized share immediately before the amendment.

AB867,4,24 (c) Restatement of articles of incorporation with or without amendment of articles; $40, unless the restatement also amends the articles to increase the number of authorized shares or to declare an indefinite number of authorized shares, in which case an amount determined as follows shall be added to the $40 fee:

AB867,5,4 1. If the restatement amends the articles to increase the number of authorized shares, 1 cent for each authorized share after the amendment, less a credit of 1 cent for each authorized share immediately before the amendment; except the maximum fee under this subdivision is $10,000.

AB867,5,7 2. If the restatement amends the articles to declare an indefinite number of authorized shares, $12,500, less a credit of 1 cent for each authorized share immediately before the amendment.

AB867,5,9 (d) Articles of merger; $50 for each domestic or foreign investment company that is a party to the merger, plus the following:

AB867,5,13 1. If the surviving domestic investment company has an indefinite number of authorized shares, $12,500, less a credit for each share that is authorized immediately before the merger by each domestic investment company that is a party to the merger.

AB867,5,18 2. If the surviving domestic investment company does not have an indefinite number of authorized shares, 1 cent for each authorized share of the surviving domestic corporation after the merger, less a credit of 1 cent for each share that is authorized immediately before the merger by each domestic corporation that is a party to the merger; except the maximum fee under this subdivision is $10,000.

AB867, s. 7 Section 7. 180.0122 (1m) (intro.) of the statutes, as created by 1995 Wisconsin Act .... (this act), is amended to read:

AB867,5,23 180.0122 (1m) (intro.) The secretary of state department shall collect the following fees when the documents described in this subsection are delivered to him or her the department for filing by an investment company:

AB867, s. 8 Section 8. 180.0202 (1) (c) of the statutes is amended to read:

AB867,6,2 180.0202 (1) (c) The number of authorized shares , except that an investment company may declare an indefinite number of authorized shares.

AB867, s. 9 Section 9. 180.0202 (1) (d) 2. of the statutes is amended to read:

AB867,6,6 180.0202 (1) (d) 2. The number of shares of each class that the corporation is authorized to issue, except that an investment company may declare that each class has an indefinite number of authorized shares.

AB867, s. 10 Section 10. 180.0202 (1) (e) 2. of the statutes is amended to read:

AB867,6,10 180.0202 (1) (e) 2. The number of shares of each series that the corporation is authorized to issue, except that an investment company may declare that each series has an indefinite number of authorized shares.

AB867, s. 11 Section 11. 180.0601 (1) of the statutes is amended to read:

AB867,6,20 180.0601 (1) The articles of incorporation shall prescribe the classes of shares and the number of shares of each class that the corporation is authorized to issue, except that an investment company may prescribe that each class has an indefinite number of authorized shares. If more than one class of shares is authorized, the articles of incorporation shall prescribe a distinguishing designation for each class. Before the issuance of shares of a class, the corporation shall describe in its articles of incorporation the preferences, limitations and relative rights of that class. All shares of a class shall have preferences, limitations and relative rights identical with those of other shares of the same class unless the class is divided into series.

AB867, s. 12 Section 12. 180.0601 (2) of the statutes is amended to read: