SB423: Bill Text

SB423,129,9 (a) Transfer title to the corporation's property.

SB423,129,11 (b) Subject its directors or officers to standards of conduct different from those under subch. VIII.

SB423,129,14 (c) Change quorum or voting requirements for its board or members; change provisions for selection, resignation, or removal of its directors or officers or both; or change provisions for amending its bylaws.

SB423,129,16 (d) Prevent commencement of a proceeding by or against the corporation in its corporate name.

SB423,129,18 (e) Abate or suspend a proceeding pending by or against the corporation on the effective date of dissolution.

SB423,129,19 (f) Terminate the authority of the registered agent.

SB423,129,24 (3) Retention of exclusive use of name. Except as provided in s. 181.1421 (6) and unless a dissolved corporation registers its corporate name under s. 181.0403 (2), the dissolved corporation retains the exclusive use of its corporate name for 120 days after the effective date of its articles of dissolution or for a shorter period if specified in its articles of dissolution under s. 181.1403 (1) (g).

SB423,130,3 181.1406 Known claims against dissolved corporation. (1) Definition. In this section, "claim" does not include a contingent liability or a claim based on an event occurring after the effective date of dissolution.

SB423,130,5 (2) Disposition of known claims. A dissolved corporation may dispose of the known claims against it by following the procedure described in this section.

SB423,130,8 (3) Notice requirements. The dissolved corporation shall notify its known claimants in writing of the dissolution at any time after its effective date. The written notice shall include all of the following information:

SB423,130,9 (a) A description of the information that must be included in a claim.

SB423,130,10 (b) A mailing address where a claim may be sent.

SB423,130,12 (c) The deadline, which may not be fewer than 120 days from the effective date of the written notice, by which the dissolved corporation must receive the claim.

SB423,130,13 (d) The claim will be barred if not received by the deadline.

SB423,130,15 (4) When claims barred. A claim against the dissolved corporation is barred if any of the following occurs:

SB423,130,17 (a) A claimant who is given written notice under sub. (2) does not deliver the claim to the dissolved corporation by the deadline.

SB423,130,20 (b) A claimant whose claim is rejected by the dissolved corporation does not commence a proceeding to enforce the claim within 90 days from the effective date of the rejection notice.

SB423,131,5 181.1407 Survival of remedies and claims. (1) Commencement of actions or proceedings. Except as provided in s. 181.1406 (4), the dissolution of a corporation does not take away or impair any remedy available to or against the corporation, its directors, officers or members, for any right or claim existing or any liability incurred, prior to such dissolution if action or other proceeding thereon is commenced within 2 years after the date of such dissolution. Any such action or proceeding by or against the corporation may be prosecuted or defended by the corporation in its corporate name. The members, directors and officers have the power to take such corporate or other action as is appropriate to protect such remedy, right or claim.

SB423,131,7 (2) Enforcement of claim against corporation. A claim may be enforced under this section against any of the following:

SB423,131,8 (a) The dissolved corporation, to the extent of its undistributed assets.

SB423,131,14 (b) If the assets have been distributed in liquidation, any person, other than a creditor of the corporation, to whom the corporation distributed its property to the extent of the distributee's prorated share of the claim or the corporate assets distributed to such person in liquidation, whichever is less, but the distributee's total liability for all claims under this section may not exceed the total amount of assets distributed to the distributee.

SB423,131,17 181.1420 Grounds for administrative dissolution. The department may bring a proceeding under s. 181.1421 to administratively dissolve a corporation if any of the following occurs:

SB423,131,19 (1) Nonpayment. The corporation does not pay, within one year after they are due, any fees or penalties due the department under this chapter.

SB423,131,21 (2) Failure to file annual report. The corporation does not have on file its annual report with the department within one year after it is due.

SB423,131,23 (3) Failure to maintain registered agent or office. The corporation is without a registered agent or registered office in this state for at least one year.

SB423,132,2 (4) Failure to notify department of change. The corporation does not notify the department within one year that its registered agent or registered office has been changed, that its registered agent has resigned or that its registered office has been discontinued.

SB423,132,5 (5) Failure of domesticating corporation to file required notice. The corporation does not file a notice required under s. 181.1533 (5) (a) within one year of the date that it is required under s. 181.1533 (5) (a) to be filed.

SB423,132,7 (6) Duration expires. The corporation's period of duration stated in its articles of incorporation expires.

SB423,132,14 181.1421 Procedure for and effect of administrative dissolution. (1) Notice of determination. If the department determines that one or more grounds exist under s. 181.1420 for dissolving a corporation, the department shall give the corporation written notice of the department's determination by certified mail, return receipt requested, addressed to the corporation's registered agent and to the corporation's principal office, as most recently designated on the records of the department.

SB423,132,19 (2) Class 2 notices. If the notices of determination under sub. (1) to the corporation's principal office and the registered agent are both returned to the department as undeliverable or if the corporation's principal office cannot be determined from the records of the department, the department shall provide the notice by publishing a class 2 notice, under ch. 985.

SB423,132,21 (3) Effective date of notice. A notice of determination made under sub. (1) or (2) is effective upon the earliest of the following:

SB423,132,22 (a) The date on which the corporation or its registered agent receives the notice.

SB423,132,24 (b) Five days after the notice is deposited in the U.S. mail, if mailed postpaid and correctly addressed.

SB423,133,3 (c) If the notice is sent by certified mail, return receipt requested, and if the return receipt is signed on behalf of the corporation, the date shown on the return receipt.

SB423,133,5 (d) If the notice is published as a class 2 notice, under ch. 985, the effective date set under ch. 985 for the notice.

SB423,133,9 (4) Cure. (a) Within 60 days after the notice is effective under sub. (3), the corporation shall correct each ground for dissolution or demonstrate to the reasonable satisfaction of the department that each ground determined by the department does not exist.

SB423,133,14 (b) If the corporation fails to satisfy par. (a), the department shall administratively dissolve the corporation by issuing a certificate of dissolution that recites each ground for dissolution and its effective date. The department shall file the original of the certificate and shall provide notice to the corporation of the certificate in the same manner as a notice of determination under subs. (1) and (2).

SB423,133,16 (5) Effect of administrative dissolution. Sections 181.1405 (1) and (2), 181.1406 and 181.1407 apply to a corporation that is administratively dissolved.

SB423,133,19 (6) Termination of right to exclusive use of name. The corporation's right to the exclusive use of its corporate name terminates on the effective date of its administrative dissolution.

SB423,133,23 181.1422 Reinstatement following administrative dissolution. (1) Application for reinstatement. A corporation that is administratively dissolved may apply to the department for reinstatement. The application shall include all of the following:

SB423,133,25 (a) The name of the corporation and the effective date of its administrative dissolution.

SB423,134,2 (b) A statement that each ground for dissolution either did not exist or has been cured.

SB423,134,3 (c) A statement that the corporation's name satisfies s. 181.0401.

SB423,134,6 (2) Grounds for reinstatement. (a) The department shall cancel the certificate of dissolution and issue a certificate of reinstatement that complies with par. (b) if the department determines all of the following:

SB423,134,8 1. That the application contains the information required by sub. (1) and the information is correct.

SB423,134,10 2. That all fees and penalties owed by the corporation to the department under this chapter have been paid.

SB423,134,13 (b) The certificate of reinstatement shall state the department's determination under par. (a) and the effective date of reinstatement. The department shall file the original of the certificate and return a copy to the corporation or its representative.

SB423,134,17 (3) Effect of reinstatement. When the reinstatement becomes effective, it shall relate back to and take effect as of the effective date of the administrative dissolution, and the corporation may resume carrying on its business as if the administrative dissolution had never occurred.

SB423,134,21 181.1423 Appeal from denial of reinstatement. (1) Notice of denial. If the department denies a corporation's application for reinstatement under s. 181.1422, the department shall serve the corporation under s. 181.0504 with a written notice that explains each reason for denial.

SB423,135,3 (2) Time for appeal of denial. The corporation may appeal the denial of reinstatement to the circuit court for the county where the corporation's principal office or, if none in this state, its registered office is located, within 30 days after service of the notice of denial is perfected. The corporation shall appeal by petitioning the court to set aside the dissolution and attaching to the petition copies of the department's certificate of dissolution, the corporation's application for reinstatement and the department's notice of denial.

SB423,135,5 (3) Judicial remedy. The court may order the department to reinstate the dissolved corporation or may take other action that the court considers appropriate.

SB423,135,7 (4) Appeal of court decision. The court's final decision may be appealed as in other civil proceedings.

SB423,135,10 181.1430 Grounds for judicial dissolution. (1) Who may bring proceeding. The circuit court may dissolve a corporation in a proceeding brought by any of the following:

SB423,135,11 (a) The attorney general if any of the following is established:

SB423,135,12 1. That the corporation obtained its articles of incorporation through fraud.

SB423,135,14 2. That the corporation has continued to exceed or abuse the authority conferred upon it by law.

SB423,135,17 (b) Fifty members or members holding 5% of the voting power, whichever is less, or any person specified in the articles of incorporation, if any of the following is established:

SB423,135,22 1. That the directors are deadlocked in the management of the corporate affairs, the members are unable to break the deadlock and, because of the deadlock, either irreparable injury to the corporation is threatened or being suffered or the business and affairs of the corporation can no longer be conducted in accordance with it corporate purposes.

SB423,135,24 2. That the directors or those in control of the corporation have acted, are acting or will act in a manner that is illegal, oppressive or fraudulent.

SB423,136,3 3. That the members are deadlocked in voting power and have failed, for a period that includes at least 2 consecutive annual meeting dates, to elect successors to directors whose terms have, or would otherwise have, expired.

SB423,136,4 4. That the corporate assets are being misapplied or wasted.

SB423,136,5 5. That the corporation is no longer able to carry out its purposes.

SB423,136,6 (c) A creditor if any of the following is established:

SB423,136,8 1. That the creditor's claim has been reduced to judgment, the execution on the judgment has been returned unsatisfied and the corporation is insolvent.

SB423,136,10 2. That the corporation has admitted in writing that the creditor's claim is due and owing and the corporation is insolvent.

SB423,136,12 (d) The corporation to have its voluntary dissolution continued under court supervision.

SB423,136,14 (2) Factors required to be considered. Before dissolving a corporation, the court shall consider all of the following:

SB423,136,15 (a) Whether there are reasonable alternatives to dissolution.

SB423,136,18 (b) Whether dissolution is the best way of protecting the interests of members or, if the corporation has no members, is in the interest of those persons or interests whom the corporation holds itself as benefiting or serving.

SB423,136,21 181.1431 Procedure for judicial dissolution. (1) Who are parties. It is not necessary to make directors or members parties to a proceeding to dissolve a corporation unless relief is sought against them individually.

SB423,137,2 (2) Powers of court. A court in a proceeding brought to dissolve a corporation may issue injunctions, appoint a receiver or custodian pendente lite with all powers and duties the court directs, take other action required to preserve the corporate assets wherever located, and carry on the activities of the corporation until a full hearing can be held.

SB423,137,9 181.1432 Receivership or custodianship. (1) Powers of court. A court in a judicial proceeding brought to dissolve a corporation may appoint one or more receivers to wind up and liquidate, or one or more custodians to manage, the affairs of the corporation. The court shall hold a hearing, after notifying all parties to the proceeding and any interested persons designated by the court, before appointing a receiver or custodian. The court appointing a receiver or custodian has exclusive jurisdiction over the corporation and all of its property wherever located.

SB423,137,14 (2) Who may serve as receiver or custodian. The court may appoint an individual, or a domestic or foreign corporation or stock corporation authorized to transact business in this state, as a receiver or custodian. The court may require the receiver or custodian to post bond, with or without sureties, in an amount the court directs.

SB423,137,17 (3) Powers and duties of receiver or custodian. (a) The court shall describe the powers and duties of the receiver or custodian in its appointing order, which may be amended from time to time.

SB423,137,18 (b) A receiver may exercise, but is not limited to, all of the following powers:

SB423,137,22 1. To dispose of all or any part of the assets of the corporation wherever located, at a public or private sale, if authorized by the court; provided, however, that the receiver's power to dispose of the assets of the corporation is subject to any trust and other restrictions that would be applicable to the corporation.

SB423,137,24 2. To sue and defend in the receiver's name as receiver of the corporation in all courts of this state.

SB423,138,5 (c) A custodian may exercise all of the powers of the corporation, through or in place of its board or officers, to the extent necessary to manage the affairs of the corporation in the best interests of its members and creditors and may sue and defend in the custodian's name as custodian of the corporation in all courts in this state.

SB423,138,9 (4) Redesignation. The court during a receivership may redesignate the receiver a custodian, and during a custodianship may redesignate the custodian a receiver, if doing so is in the best interests of the corporation, its members, and creditors.

SB423,138,14 (5) Compensation and expenses. The court from time to time during the receivership or custodianship may order compensation paid and expense disbursements or reimbursements made to the receiver or custodian and the receiver's or custodian's counsel from the assets of the corporation or proceeds from the sale of the assets.

SB423,138,19 181.1433 Decree of dissolution. (1) Entering decree. If after a hearing the court determines that one or more grounds for judicial dissolution under s. 181.1430 exist, it may enter a decree dissolving the corporation and specifying the effective date of the dissolution, and the clerk of the court shall deliver a certified copy of the decree to the department, who shall file it.

SB423,138,23 (2) Effect of decree. After entering the decree of dissolution, the court shall direct the winding up and liquidation of the corporation's affairs in accordance with s. 181.1405 and the notification of its claimants in accordance with ss. 181.1406 and 181.1407.

SB423,139,7 181.1440 Deposit with state treasurer. Assets of a dissolved corporation that should be transferred to a creditor, claimant, or member of the corporation who cannot be found or who is not competent to receive them, shall be reduced to cash subject to known trust restrictions and deposited with the state treasurer for safekeeping. However, in the state treasurer's discretion property may be received and held in kind. When the creditor, claimant, or member furnishes satisfactory proof of entitlement to the amount deposited or property held in kind, the state treasurer shall deliver to the creditor, member or other person or his or her representative that amount or property.

SB423,139,9 Subchapter XV Foreign corporations

SB423,139,12 181.1501 Authority to transact business required. (1) In general. A foreign corporation may not transact business in this state until it obtains a certificate of authority from the department.

SB423,139,14 (2) Permitted activities. The following activities, among others, do not constitute transacting business in this state within the meaning of this subchapter:

SB423,139,16 (a) Maintaining, defending or settling any civil, criminal, administrative or investigatory proceeding.

SB423,139,18 (b) Holding meetings of the board or members or carrying on other activities concerning internal corporate affairs.

SB423,139,19 (c) Maintaining bank accounts.