AB923: Bill Text

AB923, s. 9 Section 9. 180.0640 (6) of the statutes is amended to read:

AB923,8,19 180.0640 (6) A corporation's indebtedness to a shareholder incurred because of a distribution made in accordance with this section is at parity with the corpora tion's indebtedness to its general, unsecured creditors except to the extent subordi nated by agreement. This subsection does not affect the validity or priority of a secu rity interest in corporation property created to secure indebtedness incurred because of a distribution.

AB923, s. 10 Section 10. 180.0706 (1) of the statutes is amended to read:

AB923,9,2 180.0706 (1) A shareholder may waive any notice required by this chapter, the articles of incorporation or the bylaws before or after the date and time stated in the notice at any time. The waiver shall be in writing and signed by the shareholder en titled to the notice, contain the same information that would have been required in the notice under any applicable provisions of this chapter, except that the time and place of meeting need not be stated, and be delivered to the corporation for inclusion in the corporate records.

AB923, s. 11 Section 11. 180.1602 (1) of the statutes is renumbered 180.1602 (1m).

AB923, s. 12 Section 12. 180.1602 (1) of the statutes is created to read:

AB923,9,6 180.1602 (1) In this section, "shareholder" includes a beneficial owner whose shares are held in a voting trust or by a nominee on the beneficial owner's behalf.

AB923, s. 13 Section 13. 180.1604 (1) of the statutes is amended to read:

AB923,9,13 180.1604 (1) If a corporation does not within a reasonable time allow a share holder to inspect and copy any record described in s. 180.1602 (1) or (2), the share holder who complies with s. 180.1602 (1) (1m) or (2), as applicable, may apply to the circuit court for the county where the corporation's principal office or, if none in this state, its registered office is located for an order to permit inspection and copying of the records demanded.

AB923, s. 14 Section 14. 180.1915 of the statutes is renumbered 180.1915 (intro.) and amended to read:

AB923,9,25 180.1915 (title) Contract and tort Professional relationships preserved and liability. (intro.) Sections Except as provided in this section, ss. 180.1901 to 180.1921 do not alter any contract, tort or other legal relationship between a person receiving professional services and one or more persons who are licensed, certified or registered to render those professional services and who are shareholders, direc tors, officers or employes in the same service corporation. Any legal liability which may arise out of the professional service shall be joint and several among those share holders of the same service corporation. A shareholder, director, officer or employe of a service corporation is not personally liable for the debts or other contractual ob ligations of the service corporation nor for the omissions, negligence, wrongful acts, misconduct and malpractice of any person who is not under his or her actual supervi sion and control in the specific activity in which the omissions, negligence, wrongful acts, misconduct and malpractice occurred. A service corporation may charge for the services of its shareholders, directors, officers, employes or agents, may collect such charges and may compensate those who render such personal services. Nothing in this section shall affect any of the following:

AB923, s. 15 Section 15. 180.1915 (1) and (2) of the statutes are created to read:

AB923,10,11 180.1915 (1) The liability of a service corporation for the omissions, negligence, wrongful acts, misconduct and malpractice of a shareholder, director, officer or em ploye while the person, on behalf of the service corporation, provides professional ser vices.

AB923,10,17 (2) The personal liability of a shareholder, director, officer or employe of a ser vice corporation for his or her own omissions, negligence, wrongful acts, misconduct and malpractice and for the omissions, negligence, wrongful acts, misconduct and malpractice of any person acting under his or her actual supervision and control in the specific activity in which the omissions, negligence, wrongful acts, misconduct and malpractice occurred.

AB923, s. 16 Section 16. 183.0105 (3) (intro.) of the statutes is amended to read:

AB923,10,20 183.0105 (3) (intro.) Except as provided in sub. (4), a A statement of change de livered under sub. (2) (a) shall include all of the following information:

AB923, s. 17 Section 17. 183.0107 (1) (intro.) and (a) of the statutes are consolidated, re numbered 183.0107 (1) and amended to read:

AB923,11,2 183.0107 (1) Except as provided in this chapter, any document required or per mitted by this chapter to be delivered for filing to the secretary of state shall be exe cuted by any of the following: (a) Any a manager, if management of the limited liabil ity company is vested in a manager or managers, or by a any member, if management of the limited liability company is reserved to the members.

AB923, s. 18 Section 18. 183.0107 (1) (b) of the statutes is repealed.

AB923, s. 19 Section 19. 183.0201 of the statutes is amended to read:

AB923,11,9 183.0201 Organization. One or more persons may organize a limited liability company by signing and delivering articles of organization to the secretary of state for filing. The organizer or organizers need not be members of the limited liability company at the time of organization or thereafter. A limited liability company shall have 2 or more members.

AB923, s. 20 Section 20. 183.0202 (6) of the statutes is created to read:

AB923,11,12 183.0202 (6) If applicable, the delayed effective date and time of the articles of organization permitted under s. 183.0111 (2).

AB923, s. 21 Section 21. 183.0301 (1) (b) of the statutes is amended to read:

AB923,11,20 183.0301 (1) (b) The act of any member, including the execution in the name of the limited liability company of any instrument, for apparently carrying on in the ordinary course of business the business of the limited liability company, binds the limited liability company unless the member has, in fact, no authority to act for the limited liability company in the particular matter, and the person with whom the member is dealing has knowledge that the member has no authority to act in the matter.

AB923, s. 22 Section 22. 183.0301 (2) (b) of the statutes is amended to read:

AB923,12,4 183.0301 (2) (b) Each manager is an agent of the limited liability company, but not of the members or any of them, for the purpose of its business. The act of any manager, including the execution in the name of the limited liability company of any instrument, for apparently carrying on in the ordinary course of business the busi ness of the limited liability company, binds the limited liability company unless the manager has, in fact, no authority to act for the limited liability company in the par ticular matter, and the person with whom the manager is dealing has knowledge that the manager has no authority to act in the matter.

AB923, s. 23 Section 23. 183.0304 (2) of the statutes is amended to read:

AB923,12,10 183.0304 (2) Notwithstanding sub. (1), nothing in this chapter shall preclude a court from ignoring the limited liability company entity under principles of com mon law of this state that are similar to those applicable to business corporations and shareholders in this state and under circumstances that are not inconsistent with the purposes of this chapter.

AB923, s. 24 Section 24. 183.0401 (2) (c) of the statutes is amended to read:

AB923,12,14 183.0401 (2) (c) Unless earlier removed or earlier resigned, shall Shall hold of fice until a successor is elected and qualified, or until prior death, resignation or re moval.

AB923, s. 25 Section 25. 183.0402 (3) of the statutes is amended to read:

AB923,12,18 183.0402 (3) An operating agreement may impose duties on its members and managers that are in addition to, but not in abrogation of, those provided under sub. (1).

AB923, s. 26 Section 26. 183.0403 (1) of the statutes is renumbered 183.0403 (1) (intro.) and amended to read:

AB923,12,21 183.0403 (1) (intro.) In this section, "expenses":

AB923,12,22 (a) "Expenses" has the meaning given in s. 180.0850 (3).

AB923, s. 27 Section 27. 183.0403 (1) (b) of the statutes is created to read:

AB923,13,3 183.0403 (1) (b) "Liabilities" include the obligation to pay a judgment, settle ment, penalty, assessment, forfeiture or fine, including an excise tax assessed with respect to an employe benefit plan.

AB923, s. 28 Section 28. 183.0403 (2) of the statutes is amended to read:

AB923,13,9 183.0403 (2) A limited liability company shall indemnify or allow reasonable expenses to and pay liabilities of each member and, if management of the limited li ability company is vested in one or more managers, of each manager for all reason able expenses, incurred with respect to a proceeding if that member or manager was a party to the proceeding in the capacity of a member or manager.

AB923, s. 29 Section 29. 183.0403 (3) of the statutes is amended to read:

AB923,13,12 183.0403 (3) An operating agreement may alter or provide additional rights to indemnification of liabilities or allowance of expenses to members and managers.

AB923, s. 30 Section 30. 183.0403 (4) of the statutes is amended to read:

AB923,13,20 183.0403 (4) Notwithstanding subs. (2) and (3), a limited liability company may not indemnify a member or manager for liabilities or permit a member or man ager to retain any allowance for expenses provided under those subsections unless it is determined by or on behalf of the limited liability company that the member or manager did not the liabilities or expenses did not result from the member's or man ager's breach or fail failure to perform a duty to the limited liability company as pro vided in s. 183.0402.

AB923, s. 31 Section 31. 183.0403 (5) (b) of the statutes is amended to read:

AB923,14,3 183.0403 (5) (b) In situations not described in par. (a), the determination of whether a member or manager, who is a party to a proceeding because the person is a member or manager, has breached or failed to perform a duty to the limited liability company, or whether the liability or expenses resulted from the breach or failure, shall be made by the vote of the members that meets the requirements under s. 183.0404 (1) (a), except that the vote of any member who is a party to the same or a related proceeding shall be excluded unless all members are parties.

AB923, s. 32 Section 32. 183.0405 (1) (b) of the statutes is amended to read:

AB923,14,7 183.0405 (1) (b) A copy of the articles of organization and all amendments to the articles, together with executed copies of any powers of attorney under which any articles have been executed.

AB923, s. 33 Section 33. 183.0405 (1) (e) (intro.) of the statutes is amended to read:

AB923,14,10 183.0405 (1) (e) (intro.) Unless already set forth in an operating agreement, a writing written records containing all of the following information:

AB923, s. 34 Section 34. 183.0405 (1) (e) 4. of the statutes is amended to read:

AB923,14,13 183.0405 (1) (e) 4. Other writings prepared under a requirement, if any, in as required by an operating agreement.

AB923, s. 35 Section 35. 183.0601 of the statutes is amended to read:

AB923,14,21 183.0601 Interim distributions. Except as provided in this subchapter, a member is entitled to receive distributions from a limited liability company, before the member's dissociation from the limited liability company and before its dissolu tion and winding up, to the extent and at the times or upon the events specified in an operating agreement, or, if not otherwise provided in an operating agreement, to the extent and at the times determined by the members or managers under s. 183.0404 (1).

AB923, s. 36 Section 36. 183.0602 of the statutes is amended to read:

AB923,15,4 183.0602 Allocation of distributions. Distributions of cash or other assets of a limited liability company shall be allocated among the members as provided in an operating agreement. If the members do not enter into an operating agreement or the operating agreement does not so provide, distributions shall be allocated on the basis of the value, as stated in the records required to be kept under s. 183.0405 (1), of the contributions made by each member in the same manner that profits are allocated under s. 183.0503.

AB923, s. 37 Section 37. 183.0702 (2) (b) of the statutes is amended to read:

AB923,15,8 183.0702 (2) (b) A member who is not a manager does not have authority, in the member's capacity as a member, to transfer title to property of the limited liabil ity company.

AB923, s. 38 Section 38. 183.0706 (2) (a) of the statutes is amended to read:

AB923,15,15 183.0706 (2) (a) An assignee of a limited liability company interest who be comes a member has, to the extent assigned, the rights and powers, and is subject to the restrictions and liabilities, of the assignor under an operating agreement and this chapter. An assignee who becomes a member is liable for any of the assignor's obligations under an operating agreement and this chapter to the limited liability company.

AB923, s. 39 Section 39. 183.0707 of the statutes is amended to read:

AB923,15,25 183.0707 Powers of legal representative. If a member who is an individual dies or is adjudged to be incompetent to manage his or her person or estate by a court of competent jurisdiction adjudges the member to be incompetent to manage his or her person or property, the member's personal representative, administrator, guard ian, conservator, trustee or other legal representative shall have all of the rights of an assignee of the member's interest. If a member is a corporation, trust, partner ship, limited liability company or other entity and is dissolved or terminated, the powers of that member may be exercised by its legal representative or successor shall have all of the rights of an assignee of the member's interest.

AB923, s. 40 Section 40. 183.0801 (1) (b) of the statutes is amended to read:

AB923,16,6 183.0801 (1) (b) The time provided in and upon compliance with an operating agreement or, if the limited liability company does not have an operating agreement or an operating agreement does not so provide, when on the effective date of the per son's admission is as reflected in the records of the limited liability company main tained under s. 183.0405 (1).

AB923, s. 41 Section 41. 183.0801 (2) (a) of the statutes is amended to read:

AB923,16,14 183.0801 (2) (a) In the case of a person acquiring a limited liability company interest directly from the limited liability company, at the time provided in and upon compliance with an operating agreement or, if the limited liability company does not have an operating agreement or an operating agreement does not so provide, upon the consent of all members and when on the effective date of the person's admission is as reflected in the records of the limited liability company maintained under s. 183.0405 (1).

AB923, s. 42 Section 42. 183.0801 (2) (b) of the statutes is amended to read:

AB923,16,21 183.0801 (2) (b) In the case of an assignee of a limited liability company inter est, as provided in s. 183.0706 (1) and at the time provided in and upon compliance with an operating agreement or, if the limited liability company does not have an op erating agreement or an operating agreement does not so provide, when on the effec tive date of the person's admission is as reflected in the records of the limited liability company maintained under s. 183.0405 (1).

AB923, s. 43 Section 43. 183.0802 (1) (h) of the statutes is amended to read:

AB923,17,2 183.0802 (1) (h) Unless otherwise provided in an operating agreement or by the written consent of all members at the time, if the member is a separate domestic or foreign limited liability company, the dissolution and commencement of winding up of the separate domestic or foreign limited liability company.

AB923, s. 44 Section 44. 183.0802 (1) (k) of the statutes is created to read:

AB923,17,6 183.0802 (1) (k) Unless otherwise provided in an operating agreement or by the written consent of all members at the time, if the member is a partnership or other entity not described under pars. (g) to (j), the dissolution of the partnership or entity.

AB923, s. 45 Section 45. 183.0802 (3) of the statutes is amended to read:

AB923,17,21 183.0802 (3) Unless an operating agreement provides that a member does not have the power to withdraw by voluntary act from a limited liability company, the member may do so at any time by giving written notice to the other members, or on any other terms as are provided in an operating agreement. If the member has the power to withdraw but the withdrawal is a breach of an operating agreement or the withdrawal occurs as a result of otherwise wrongful conduct of the member, the lim ited liability company may recover from the withdrawing member damages for breach of the operating agreement or as a result of the wrongful conduct and may offset the damages against the amount otherwise distributable to the member, in addition to pursuing any remedies provided for in an operating agreement or other wise available under applicable law. Unless otherwise provided in an operating agreement, in the case of a limited liability company for a definite term or particular undertaking, a withdrawal by a member before the expiration of that term or comple tion of that undertaking is a breach of the operating agreement.

AB923, s. 46 Section 46. 183.0901 (3) of the statutes is repealed.

AB923, s. 47 Section 47. 183.0901 (4) (a) of the statutes is amended to read:

AB923,18,3 183.0901 (4) (a) The business of the limited liability company is continued by the consent of all of the remaining members within 90 days after the date on which the event occurs at which time the remaining members may agree to the admission of one or more additional members or to the appointment of one or more additional managers, or both.

AB923, s. 48 Section 48. 183.0907 (2) (intro.) of the statutes is amended to read:

AB923,18,7 183.0907 (2) (intro.) A dissolved limited liability company may notify its known claimants in writing of the dissolution at any time after the effective date of its ar ticles of dissolution. The written notice shall include all of the following:

AB923, s. 49 Section 49. 183.0907 (2) (c) of the statutes is amended to read:

AB923,18,11 183.0907 (2) (c) The deadline, which may not be fewer than 120 days after the later of the date of the written notice or the filing of articles of dissolution under s. 183.0906, by which the limited liability company must receive the claim.

AB923, s. 50 Section 50. 183.0908 (1) of the statutes is amended to read:

AB923,18,17 183.0908 (1) A At any time after the effective date of its articles of dissolution, a dissolved limited liability company may publish a notice of its dissolution under this section that requests that persons with claims, whether known or unknown, against the limited liability company or its members or managers, in their capacities as such, present the claims in accordance with the notice.

AB923, s. 51 Section 51. 183.0908 (3) (intro.) of the statutes is amended to read:

AB923,18,24 183.0908 (3) (intro.) If a dissolved limited liability company publishes a notice under sub. (2) and files articles of dissolution under s. 183.0906, the claim of any of the following claimants against the limited liability company or its members or man agers is barred unless the claimant commences a proceeding to enforce the claim within 2 years after the later of the date of the publication of the notice or the filing of the articles of dissolution:

AB923, s. 52 Section 52. 183.0908 (4) of the statutes is repealed.

AB923, s. 53 Section 53. 183.0909 of the statutes is created to read:

AB923,19,3 183.0909 Enforcing claims. A claim not barred under s. 183.0907 or 183.0908 may be enforced under this section against any of the following:

AB923,19,5 (1) The dissolved limited liability company, to the extent of its undistributed assets.