SB423: Bill Text

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.

SB423,139,22 (d) Maintaining offices or agencies for the transfer, exchange and registration of the foreign corporation's memberships or maintaining trustees or depositaries with respect to those memberships.

SB423,139,23 (e) Selling through independent contractors.

SB423,140,3 (f) Soliciting or obtaining orders, whether by mail or through employes or agents or otherwise, if the orders require acceptance outside this state before they become contracts.

SB423,140,5 (g) Creating or acquiring indebtedness, mortgages and security interests in property.

SB423,140,7 (h) Securing or collecting debts or enforcing mortgages and security interests in property securing the debts.

SB423,140,8 (i) Owning, without more, property.

SB423,140,10 (j) Conducting an isolated transaction that is completed within 30 days and that is not one in the course of repeated transactions of a like nature.

SB423,140,11 (k) Transacting business in interstate commerce.

SB423,140,16 181.1502 Consequences of transacting business without authority. (1) Court proceedings barred. A foreign corporation transacting business in this state without a certificate of authority, if a certificate of authority is required under s. 181.1501, may not maintain a proceeding in any court in this state until it obtains a certificate of authority.

SB423,140,21 (2) Successors to foreign corporations. The successor to a foreign corporation that transacted business in this state without a certificate of authority and the assignee of a cause of action arising out of that business may not maintain a proceeding on that cause of action in any court in this state until the foreign corporation or its successor obtains a certificate of authority.

SB423,141,2 (3) Stay of proceedings. A court may stay a proceeding commenced by a foreign corporation, its successor or its assignee until the court determines whether the foreign corporation or its successor requires a certificate of authority. If it so determines, the court may further stay the proceeding until the foreign corporation or its successor obtains the certificate.

SB423,141,8 (4) Penalties. (a) Beginning on the first day of the 13th month beginning after the effective date of this paragraph .... [revisor inserts date], a foreign corporation that transacts business in this state without a certificate of authority is liable to the state, for each year or any part of a year during which it transacted business in this state without a certificate of authority, in an amount equal to the sum of all of the following:

SB423,141,11 1. All fees that would have been imposed under this chapter upon the foreign corporation had it applied for and received a certificate of authority when it began transacting business in this state.

SB423,141,13 2. A fee of $50 for each year or portion of a year during which it transacted business without a certificate of authority or $500, whichever is less.

SB423,141,18 (b) The foreign corporation shall pay the amount owed under par. (a) to the department. The department may not issue a certificate of authority to the foreign corporation until the amount owed under par. (a) is paid. The attorney general may enforce a foreign corporation's obligation to pay the department any amount owed under par. (a).

SB423,141,23 (5) Validity of corporate actions. Notwithstanding subs. (1) and (2), the failure of a foreign corporation to obtain a certificate of authority does not impair the validity of its corporate acts or its title to property in this state or prevent it from defending any civil, criminal, administrative or investigatory proceeding in this state.

SB423,142,3 181.1503 Application for certificate of authority. (1) Filing requirements. A foreign corporation may apply for a certificate of authority to transact business in this state by delivering an application to the department for filing. The application shall be made on a form prescribed by the department and shall include all of the following information:

SB423,142,5 (a) The name of the foreign corporation or, if its name is unavailable for use in this state, a fictitious name that satisfies s. 181.1506.

SB423,142,6 (b) The name of the state or country under whose law it is incorporated.

SB423,142,7 (c) Its date of incorporation and period of duration.

SB423,142,8 (d) The street address of its principal office.

SB423,142,10 (e) The street address of its registered office in this state and the name of its registered agent at that office.

SB423,142,12 (f) The name and usual business or home address of each of its current directors and principal officers.

SB423,142,13 (g) Whether the foreign corporation has members.

SB423,142,14 (h) A statement that the corporation is organized without capital stock.

SB423,142,19 (2) Authentication. The foreign corporation shall deliver with the completed application a certificate of status or a document of similar import authenticated by the secretary of state or other official having custody of corporate records in the state or country under whose law it is incorporated. The certificate shall be dated no earlier than 60 days before its delivery.

SB423,142,23 181.1504 Amended certificate of authority. (1) When required. A foreign corporation authorized to transact business in this state shall obtain an amended certificate of authority from the department if the foreign corporation changes any of the following:

SB423,142,25 (a) Its corporate name or the fictitious name under which it has been issued a certificate of authority.

SB423,143,1 (b) The period of its duration.

SB423,143,2 (c) The state or country of its incorporation.

SB423,143,6 (2) Filing and authentication requirements. The requirements of s. 181.1503 for obtaining an original certificate of authority apply to obtaining an amended certificate under this section, except that a foreign corporation is not required to deliver a certificate of status with an application solely to change a fictitious name.

SB423,143,10 181.1505 Effect of certificate of authority. (1) Transaction of business. A certificate of authority issued to a foreign corporation authorizes the foreign corporation to transact business in this state subject to the right of the state to revoke the certificate as provided in this chapter.

SB423,143,15 (2) Rights and privileges. A foreign corporation with a valid certificate of authority has the same rights and enjoys the same privileges as and, except as otherwise provided by this chapter, is subject to the same duties, restrictions, penalties and liabilities now or later imposed on, a domestic corporation of like character.

SB423,143,18 (3) Internal affairs. This chapter does not authorize this state to regulate the organization or internal affairs of a foreign corporation authorized to transact business in this state.

SB423,143,24 181.1506 Corporate name of foreign corporation. (1) Fictitious name. If the corporate name of a foreign corporation is not available under sub. (2), the foreign corporation, to obtain or maintain a certificate of authority to transact business in this state, may use a fictitious name to transact business in this state if it delivers to the department for filing a copy of the resolution of its board of directors, certified by any of its officers, adopting the fictitious name.