AB765,97,6
5(1) Employes, suppliers and customers. The effects of the action on employes,
6suppliers and customers of the corporation.
AB765,97,8
7(2) Communities. The effects of the action on communities in which the
8corporation operates.
AB765,97,9
9(3) Other. Any other factors that the director or officer considers pertinent.
AB765,97,17
10181.0855 Limited liability of directors and officers. (1) In general. 11Except as provided in subs. (2) and (3), a director or officer is not liable to the
12corporation, its members or creditors, or any person asserting rights on behalf of the
13corporation, its members or creditors, or any other person, for damages, settlements,
14fees, fines, penalties or other monetary liabilities arising from a breach of, or failure
15to perform, any duty resulting solely from his or her status as a director or officer,
16unless the person asserting liability proves that the breach or failure to perform
17constitutes any of the following:
AB765,97,2018
(a) A wilful failure to deal fairly with the corporation or its members in
19connection with a matter in which the director or officer has a material conflict of
20interest.
AB765,97,2321
(b) A violation of criminal law, unless the director or officer had reasonable
22cause to believe that his or her conduct was lawful or no reasonable cause to believe
23that his or her conduct was unlawful.
AB765,97,2524
(c) A transaction from which the director or officer derived an improper
25personal profit or benefit.
AB765,98,1
1(d) Wilful misconduct.
AB765,98,3
2(2) Exceptions. Except as provided in sub. (3), this section does not apply to
3any of the following:
AB765,98,54
(a) A civil, criminal, administrative or investigatory proceeding brought by or
5on behalf of any governmental unit, authority or agency.
AB765,98,86
(b) A proceeding brought by any person for a violation of state or federal law
7where the proceeding is brought pursuant to an express private right of action
8created by state or federal statute.
AB765,98,99
(c) The liability of a director under ss. 181.0832 and 181.0833.
AB765,98,12
10(3) Governmental entity acting in capacity as private party. Subsection (2)
11(a) and (b) does not apply to a proceeding brought by a governmental unit, authority
12or agency in its capacity as a private party or contractor.
AB765,98,19
13181.0860 Statements of changes in directors or principal officers. (1) 14Changes in directors or principal officers. Whenever initial directors and
15principal officers are selected, or changes are made in the directors or principal
16officers of a corporation, the corporation may file with the department a statement
17that includes the names and addresses of all of the directors or principal officers, or
18both if there have been changes in both. The information in the statement shall be
19current as of the date on which the statement is signed on behalf of the corporation.
AB765,98,22
20(2) Resignation notices. A director who resigns under s. 181.0807 or a
21principal officer who resigns under s. 181.0843 (1) may file a copy of the resignation
22notice with the department.
AB765,98,24
23181.0871 Definitions applicable to indemnification and insurance
24provisions. In ss. 181.0871 to 181.0883:
AB765,99,3
1(1) "Corporation" means a domestic corporation and any domestic or foreign
2predecessor of a domestic corporation where the predecessor corporation's existence
3ceased upon the consummation of a merger or other transaction.
AB765,99,4
4(2) "Director or officer" means any of the following:
AB765,99,55
(a) An individual who is or was a director or officer of a corporation.
AB765,99,106
(b) An individual who, while a director or officer of a corporation, is or was
7serving at the corporation's request as a director, officer, partner, trustee, member
8of any governing or decision-making committee, manager, employe or agent of
9another corporation or foreign corporation, limited liability company, partnership,
10joint venture, trust or other enterprise.
AB765,99,1411
(c) An individual who, while a director or officer of a corporation, is or was
12serving an employe benefit plan because his or her duties to the corporation also
13impose duties on, or otherwise involve services by, the individual to the plan or to
14participants in or beneficiaries of the plan.
AB765,99,1615
(d) Unless the context requires otherwise, the estate or personal representative
16of a director or officer.
AB765,99,18
17(3) "Expenses" include fees, costs, charges, disbursements, attorney fees and
18any other expenses incurred in connection with a proceeding.
AB765,99,21
19(4) "Liability" includes the obligation to pay a judgment, settlement, penalty,
20assessment, forfeiture or fine, including any excise tax assessed with respect to an
21employe benefit plan, and reasonable expenses.
AB765,99,23
22(5) "Party" includes an individual who was or is, or who is threatened to be
23made, a named defendant or respondent in a proceeding.
AB765,99,25
24(6) "Proceeding" means any threatened, pending or completed civil, criminal,
25administrative or investigative action, suit, arbitration or other proceeding, whether
1formal or informal, which involves foreign, federal, state or local law and which is
2brought by or in the right of the corporation or by any other person.
AB765,100,7
3181.0872 Mandatory indemnification.
(1) In general. A corporation shall
4indemnify a director or officer, to the extent that he or she has been successful on the
5merits or otherwise in the defense of a proceeding, for all reasonable expenses
6incurred in the proceeding if the director or officer was a party because he or she is
7a director or officer of the corporation.
AB765,100,13
8(2) Exceptions. (a) In cases not included under sub. (1), a corporation shall
9indemnify a director or officer against liability incurred by the director or officer in
10a proceeding to which the director or officer was a party because he or she is a director
11or officer of the corporation, unless liability was incurred because the director or
12officer breached or failed to perform a duty that he or she owes to the corporation and
13the breach or failure to perform constitutes any of the following:
AB765,100,1614
1. A wilful failure to deal fairly with the corporation or its members in
15connection with a matter in which the director or officer has a material conflict of
16interest.
AB765,100,1917
2. A violation of the criminal law, unless the director or officer had reasonable
18cause to believe that his or her conduct was lawful or no reasonable cause to believe
19that his or her conduct was unlawful.
AB765,100,2120
3. A transaction from which the director or officer derived an improper personal
21profit or benefit.
AB765,100,2222
4. Wilful misconduct.
AB765,100,2423
(b) Determination of whether indemnification is required under this
24subsection shall be made under s. 181.0873.
AB765,101,4
1(c) The termination of a proceeding by judgment, order, settlement or
2conviction, or upon a plea of no contest or an equivalent plea, does not, by itself, create
3a presumption that indemnification of the director or officer is not required under
4this subsection.
AB765,101,6
5(3) Written request required. A director or officer who seeks indemnification
6under this section shall make a written request to the corporation.
AB765,101,9
7(4) Limitation by articles of incorporation. (a) Indemnification under this
8section is not required to the extent limited by the articles of incorporation under s.
9181.0875.
AB765,101,1210
(b) Indemnification under this section is not required if the director or officer
11has previously received indemnification, reimbursement or allowance of expenses
12from any person, including the corporation, in connection with the same proceeding.
AB765,101,17
13181.0873 Determination of right to indemnification. Unless otherwise
14provided by the articles of incorporation or bylaws or by written agreement between
15the director or officer and the corporation, the director or officer seeking
16indemnification under s. 181.0872 (2) shall select one of the following means for
17determining his or her right to indemnification:
AB765,101,24
18(1) Board of director vote. By a majority vote of a quorum of the board of
19directors consisting of directors who are not at the time parties to the same or related
20proceedings. If a quorum of disinterested directors cannot be obtained, by a majority
21vote of a committee duly appointed by the board of directors and consisting solely of
222 or more directors who are not at the time parties to the same or related proceedings.
23Directors who are parties to the same or related proceedings may participate in the
24designation of members of the committee.
AB765,102,5
1(2) Independent legal counsel. By independent legal counsel selected by a
2quorum of the board of directors or its committee in the manner prescribed in sub.
3(1) or, if unable to obtain such a quorum or committee, by a majority vote of the full
4board of directors, including directors who are parties to the same or related
5proceedings.
AB765,102,9
6(3) Arbitrators. By a panel of 3 arbitrators consisting of one arbitrator selected
7by those directors entitled under sub. (2) to select independent legal counsel, one
8arbitrator selected by the director or officer seeking indemnification and one
9arbitrator selected by the 2 arbitrators previously selected.
AB765,102,13
10(4) Members. By an affirmative vote of members with voting rights, if any.
11Membership rights owned by, or voted under the control of, persons who are at the
12time parties to the same or related proceedings, whether as plaintiffs or defendants
13or in any other capacity, may not be voted in making the determination.
AB765,102,14
14(5) Court. By a court under s. 181.0879.
AB765,102,16
15(6) Other methods. By any other method provided for in any additional right
16to indemnification permitted under s. 181.0877.
AB765,102,20
17181.0874 Allowance of expenses as incurred. Upon written request by a
18director or officer who is a party to a proceeding, a corporation may pay or reimburse
19his or her reasonable expenses as incurred if the director or officer provides the
20corporation with all of the following:
AB765,102,23
21(1) Written affirmation. A written affirmation of his or her good faith belief
22that he or she has not breached or failed to perform his or her duties to the
23corporation.
AB765,103,6
24(2) Repayment undertaking. A written undertaking, executed personally or on
25his or her behalf, to repay the allowance and, if required by the corporation, to pay
1reasonable interest on the allowance to the extent that it is ultimately determined
2under s. 181.0873 that indemnification under s. 181.0872 (2) is not required and that
3indemnification is not ordered by a court under s. 181.0879 (2) (b). The undertaking
4under this subsection shall be an unlimited general obligation of the director or
5officer and may be accepted without reference to his or her ability to repay the
6allowance. The undertaking may be secured or unsecured.
AB765,103,9
7181.0875 Corporation may limit indemnification. (1) Methods of
8limiting obligation. A corporation's obligations to indemnify under s. 181.0872 may
9be limited as follows:
AB765,103,1210
(a) If the corporation is incorporated on or after June 13, 1987, by the articles
11of incorporation, including any amendments or restatements of the articles of
12incorporation.
AB765,103,1513
(b) If the corporation was incorporated before June 13, 1987, by an amendment
14to, or restatement of, the articles of incorporation which becomes effective on or after
15June 13, 1987.
AB765,103,18
16(2) Applicability. A limitation under sub. (1) applies if the first alleged act of
17a director or officer for which indemnification is sought occurred while the limitation
18was in effect.
AB765,103,23
19181.0877 Additional rights to indemnification and allowance of
20expenses. (1) Additional rights to indemnification. Except as provided in sub.
21(2), ss. 181.0872 and 181.0874 do not preclude any additional right to
22indemnification or allowance of expenses that a director or officer may have under
23any of the following:
AB765,103,2424
(a) The articles of incorporation or bylaws.
AB765,103,2525
(b) A written agreement between the director or officer and the corporation.
AB765,104,1
1(c) A resolution of the board of directors.
AB765,104,32
(d) A resolution, after notice, adopted by a majority vote of members who are
3entitled to vote.
AB765,104,11
4(2) When prohibited. Regardless of the existence of an additional right under
5sub. (1), the corporation may not indemnify a director or officer, or permit a director
6or officer to retain any allowance of expenses unless it is determined by or on behalf
7of the corporation that the director or officer did not breach or fail to perform a duty
8that he or she owes to the corporation which constitutes conduct under s. 181.0872
9(2) (a) 1., 2., 3. or 4. A director or officer who is a party to the same or related
10proceeding for which indemnification or an allowance of expenses is sought may not
11participate in a determination under this subsection.
AB765,104,14
12(3) Applicability. Sections 181.0871 to 181.0883 do not affect a corporation's
13power to pay or reimburse expenses incurred by a director or officer in any of the
14following circumstances:
AB765,104,1515
(a) As a witness in a proceeding to which he or she is not a party.
AB765,104,1716
(b) As a plaintiff or petitioner in a proceeding because he or she is or was an
17employe, agent, director or officer of the corporation.
AB765,104,25
18181.0879 Court-ordered indemnification.
(1) Application to court. 19Except as provided otherwise by written agreement between the director or officer
20and the corporation, a director or officer who is a party to a proceeding may apply for
21indemnification to the court conducting the proceeding or to another court of
22competent jurisdiction. Application shall be made for an initial determination by the
23court under s. 181.0873 (5) or for review by the court of an adverse determination
24under s. 181.0873 (1), (2), (3), (4) or (6). After receipt of an application, the court shall
25give any notice it considers necessary.
AB765,105,2
1(2) Standards used by court. The court shall order indemnification if it
2determines any of the following:
AB765,105,73
(a) That the director or officer is entitled to indemnification under s. 181.0872
4(1) or (2). If the court also determines that the corporation unreasonably refused the
5director's or officer's request for indemnification, the court shall order the
6corporation to pay the director's or officer's reasonable expenses incurred to obtain
7the court-ordered indemnification.
AB765,105,108
(b) That the director or officer is fairly and reasonably entitled to
9indemnification in view of all the relevant circumstances, regardless of whether
10indemnification is required under s. 181.0872 (2).
AB765,105,15
11181.0881 Indemnification and allowance of expenses of employes and
12agents. A corporation may indemnify and allow reasonable expenses of an employe
13or agent who is not a director or officer to the extent provided by the articles of
14incorporation or bylaws, by general or specific action of the board of directors or by
15contract.
AB765,105,22
16181.0883 Insurance. A corporation may purchase and maintain insurance
17on behalf of an individual who is an employe, agent, director or officer of the
18corporation against liability asserted against and incurred by the individual in his
19or her capacity as an employe, agent, director or officer, or arising from his or her
20status as an employe, agent, director or officer, regardless of whether the corporation
21is required or authorized to indemnify or allow expenses to the individual against the
22same liability under ss. 181.0872, 181.0874, 181.0877 and 181.0881.
AB765,106,2
23181.0889 Indemnification and insurance against securities law claims. 24(1) In general. It is the public policy of this state to require or permit
25indemnification, allowance of expenses and insurance for any liability incurred in
1connection with a proceeding involving securities regulation described under sub. (2)
2to the extent required or permitted under ss. 181.0871 to 181.0883.
AB765,106,6
3(2) Scope of securities regulation. Sections 181.0871 to 181.0883 apply, to
4the extent applicable to any other proceeding, to any proceeding involving a federal
5or state statute, rule or regulation regulating the offer, sale or purchase of securities,
6securities brokers or dealers, or investment companies or investment advisers.
AB765,106,87
Subchapter IX
8
[REserved]
AB765,106,119
Subchapter X
10
Amendment of articles of
11
incorporation and bylaws
AB765,106,17
12181.1001 Authority to amend articles of incorporation. A corporation
13may amend its articles of incorporation at any time to add or change a provision that
14is required or permitted to be included in the articles of incorporation or to delete a
15provision that is not required in the articles of incorporation. Whether a provision
16is required or permitted to be included in the articles of incorporation is determined
17as of the effective date of the amendment.
AB765,106,22
18181.1002 Amendment of articles of incorporation by directors. (1) 19Corporations with voting rights. Unless the articles of incorporation provide
20otherwise, a corporation's board may adopt any of the following amendments to the
21corporation's articles of incorporation, without the approval of members with voting
22rights:
AB765,106,2423
(a) To extend the duration of the corporation if it was incorporated at a time
24when limited duration was required by law.
AB765,106,2525
(b) To delete the names and addresses of the initial directors.
AB765,107,1
1(c) To delete the names and addresses of the incorporators.
AB765,107,32
(d) To delete the name and address of a former registered agent or registered
3office, if a statement of change is on file with the department.
AB765,107,44
(e) To change the registered agent or the registered office.
AB765,107,95
(f) To change the corporate name by substituting the word "corporation",
6"incorporated", "company" or, "limited", or the abbreviation "corp.", "inc.", "co.", or
7"ltd.", or words or abbreviations of similar meaning in another language, for a similar
8word or abbreviation in the name, or by adding, deleting or changing a geographical
9attribution to the name.
AB765,107,1110
(g) To make any other change expressly permitted by this chapter to be made
11without member approval.
AB765,107,22
12(2) Corporations with no voting members. If a corporation has no members
13with voting rights, its incorporators, until directors have been chosen, and thereafter
14its board, may adopt amendments to the corporation's articles of incorporation
15subject to any approval required under s. 181.1030. The corporation shall provide
16notice of any meeting at which an amendment is to be voted upon. The notice shall
17be in accordance with s. 181.0822 (3). The notice must also state that the purpose,
18or one of the purposes, of the meeting is to consider a proposed amendment to the
19articles of incorporation and contain or be accompanied by a copy or summary of the
20amendment or state the general nature of the amendment. The amendment must
21be approved by a majority of the directors in office at the time that the amendment
22is adopted.
AB765,108,2
23181.1003 Amendment of articles of incorporation by directors and
24members. (1) In general. Unless this chapter, the articles of incorporation or the
1bylaws require a greater vote or voting by class, an amendment to a corporation's
2articles of incorporation to be adopted must be approved by all of the following:
AB765,108,43
(b) Except as provided in s. 181.1002 (1), the members by two-thirds of the
4votes cast or a majority of the voting power, whichever is less.
AB765,108,65
(c) A person, in writing, whose approval is required by a provision of the articles
6of incorporation authorized under s. 181.1030.
AB765,108,12
7(2) Notice requirements. If the board or the members seek to have the
8amendment approved by the members at a membership meeting, the corporation
9shall give notice to its members of the proposed membership meeting in writing in
10accordance with s. 181.0705. The notice shall state that the purpose, or one of the
11purposes, of the meeting is to consider and to act upon the proposed amendment and
12shall contain or be accompanied by a copy or summary of the amendment.
AB765,108,16
13(3) Written consents or ballot. If the board or the members seek to have the
14amendment approved by the members by written consent or written ballot, the
15material soliciting the approval shall contain or be accompanied by a copy or
16summary of the amendment.
AB765,108,20
17181.1004 Class voting by members on amendments to articles of
18incorporation. (1) When class entitled to vote. The members of a class in a
19corporation are entitled to vote as a class on a proposed amendment to the articles
20of incorporation if the amendment does any of the following:
AB765,108,2321
(a) Affects the rights, privileges, preferences, restrictions or conditions of that
22class as to voting, dissolution, redemption or transfer of memberships in a manner
23different than such amendment would affect another class.
AB765,109,3
1(b) Changes the rights, privileges, preferences, restrictions or conditions of that
2class as to voting, dissolution, redemption or transfer by changing the rights,
3privileges, preferences, restrictions or conditions of another class.
AB765,109,44
(c) Increases or decreases the number of memberships authorized for that class.