SB494: Bill Text

SB494,70,21 2. Preserving exemptions under federal or state securities law.

SB494,70,25 (b) A transfer restriction may not affect shares and other securities issued before the restriction is adopted, unless the holders of the shares and other securities are parties to the transfer restriction agreement or vote in favor of the transfer restriction.

SB494,71,5 (3) Enforceability. A transfer restriction is valid and enforceable against the holder or a transferee of the holder if the transfer restriction is authorized by this section and its existence is noted conspicuously on the front or back of the certificate. Unless so noted, a transfer restriction is not enforceable against a person who does not know of the transfer restriction.

SB494,71,8 (4) Types of permitted transfer restrictions. The transfer restrictions permitted under this section include transfer restrictions that do any of the following:

SB494,71,11 (a) Obligate the shareholder or holder of other securities first to offer the bank or other persons, whether separately, consecutively or simultaneously, an opportunity to acquire the restricted shares or other securities.

SB494,71,14 (b) Subject to the limitations of s. 221.0323, if applicable, obligate the bank or other persons, whether separately, consecutively or simultaneously, to acquire the restricted shares or other securities.

SB494,71,17 (c) Require the bank, the holders of a class of its shares or other securities or another person to approve the transfer of the restricted shares or other securities, if the requirement is not manifestly unreasonable.

SB494,71,20 (d) Prohibit the transfer of the restricted shares or other securities to designated persons or classes of persons, if the prohibition is not manifestly unreasonable.

SB494,71,22 221.0510 Preemptive rights. (1) Definition. In this section, "other securities" has the meaning given in s. 221.0509 (1) (a).

SB494,72,4 (2) When preemptive rights exist. The shareholders or holders of other securities of a bank do not have a preemptive right to acquire the bank's unissued shares or other securities except to the extent provided in the articles of incorporation. If the articles of incorporation state that "the bank elects to have preemptive rights", or words of similar meaning, subs. (3) to (6) govern the preemptive rights, except to the extent that the articles of incorporation expressly provide otherwise.

SB494,72,11 (3) Conditions for exercise of preemptive rights. Except as provided in sub. (5), the shareholders or holders of other securities of the bank have a preemptive right, granted on uniform terms and conditions prescribed by the board of directors to provide a fair and reasonable opportunity to exercise the right, to acquire proportional amounts of the bank's unissued shares or other securities upon the decision of the board of directors to issue the shares or other securities, subject to the following conditions:

SB494,72,14 (a) Holders of shares or other securities with general voting rights have preemptive rights with respect to shares and other securities of any class with general voting rights.

SB494,72,20 (b) Holders of shares or other securities without preferential rights to distributions or assets have preemptive rights with respect to shares and other securities of any class without preferential rights to distributions or assets, except that holders of shares or other securities without general voting rights have no preemptive rights with respect to shares or other securities of any class with general voting rights.

SB494,72,23 (4) Waiver. A shareholder or holder of other securities may waive his or her preemptive right. A written waiver is irrevocable even if it is not supported by consideration.

SB494,72,25 (5) Exemptions. There is no preemptive right with respect to any of the following:

SB494,73,2 (a) Shares or other securities issued as compensation to directors, officers or employes of the bank or its affiliates.

SB494,73,5 (b) Shares or other securities issued to satisfy conversion or option rights created to provide compensation to directors, officers or employes of the bank or its affiliates.

SB494,73,7 (c) Shares or other securities authorized in articles of incorporation that are issued within 6 months after the effective date of incorporation.

SB494,73,9 (d) Shares or other securities sold for other than money or an obligation to pay money.

SB494,73,10 (e) Treasury shares.

SB494,73,17 (6) Lapse of preemptive rights. If shares or other securities subject to preemptive rights are not acquired by shareholders or holders of other securities, the bank may issue the shares or other securities to any person for one year after being offered to shareholders or holders of other securities, at a consideration set by the board of directors that is not lower than the consideration set for the exercise of preemptive rights. An offer at a lower consideration or after the expiration of one year is subject to the preemptive rights of shareholders or holders of other securities.

SB494,73,19 221.0511 Annual meeting. (1) When held. A bank shall hold a meeting of shareholders annually at a time stated in or fixed in accordance with the bylaws.

SB494,73,23 (2) Where held. A bank may hold the annual shareholders' meeting in or outside this state at the place stated in or fixed in accordance with the bylaws. If no place is stated in or fixed in accordance with the bylaws, the bank shall hold the annual meeting at its principal office.

SB494,73,25 (3) Effect of failure to comply. Failure to hold an annual meeting in one or more years does not affect the validity of any bank action.

SB494,74,2 221.0512 Special meeting. (1) When required. A bank shall hold a special meeting of shareholders if any of the following occurs:

SB494,74,4 (a) A special meeting is called by the board of directors or any person authorized by the articles of incorporation or bylaws to call a special meeting.

SB494,74,8 (b) The holders of at least 10% of all the votes entitled to be cast on an issue proposed to be considered at the proposed special meeting sign, date and deliver to the bank one or more written demands for the meeting describing one or more purposes for which it is to be held.

SB494,74,11 (2) Record date. If not otherwise fixed under s. 221.0517, the record date for determining shareholders entitled to demand a special meeting is the date that the first shareholder signs the demand.

SB494,74,15 (3) Where held. A bank may hold a special shareholders' meeting in or outside this state at the place stated in or fixed in accordance with the bylaws. If no place is stated in or fixed in accordance with the bylaws, the bank shall hold a special meeting at its principal office.

SB494,74,18 (4) Limitation on business conducted. Only business within the purpose described in the meeting notice required by s. 221.0514 (2) (b) may be conducted at a special shareholders' meeting.

SB494,74,21 221.0513 Action without meeting. (1) Permitted methods. Action required or permitted by this chapter to be taken at a shareholders' meeting may be taken without a meeting in any of the following ways:

SB494,74,23 (a) Without action by the board of directors, by all shareholders entitled to vote on the action.

SB494,75,5 (b) If the articles of incorporation so provide, by shareholders who would be entitled to vote at a meeting those shares with voting power to cast not less than the minimum number or, in the case of voting by voting groups, numbers of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote were present and voted, except action may not be taken under this paragraph with respect to an election of directors for which shareholders may vote cumulatively under s. 221.0522.

SB494,75,9 (2) How documented. Action under sub. (1) must be evidenced by one or more written consents describing the action taken, signed by the number of shareholders necessary to take the action under sub. (1) (a) or (b) and delivered to the bank for inclusion in the bank records.

SB494,75,16 (3) Effective date. Action taken under sub. (1) is effective when consents representing the required number of shares are delivered to the bank, unless the consent specifies a different effective date. Within 10 days after action taken under sub. (1) (b) is effective, the bank shall give notice of the action to shareholders who, on the record date determined under sub. (4), were entitled to vote on the action but whose shares were not represented on the written consent. The notice shall comply with s. 221.0103.

SB494,75,19 (4) Record date. If not otherwise fixed under s. 221.0518, the record date for determining shareholders entitled to take action without a meeting is the date that the first shareholder signs the consent under sub. (1).

SB494,75,21 (5) Effect of written consent. A consent signed under this section has the effect of a meeting vote and may be described as such in any document.

SB494,76,4 (6) Notice requirements. If this chapter requires that notice of proposed action be given to shareholders who are not entitled to vote on the action and the action is to be taken under this section, the bank shall give those nonvoting shareholders written notice of the proposed action at least 10 days before the action becomes effective. The notice shall comply with s. 221.0103 and shall contain or be accompanied by the same material that, under this chapter, would have been required to be sent to nonvoting shareholders in a notice of meeting at which the proposed action would have been submitted to the shareholders for action.

SB494,76,11 221.0514 Notice of meeting. (1) When required. A bank shall notify shareholders of the date, time and place of each annual and special shareholders' meeting not less than 10 days nor more than 60 days before the meeting date, unless a different time is provided by this chapter, the articles of incorporation or the bylaws. The notice shall comply with s. 221.0103. Unless this chapter or the articles of incorporation require otherwise, the bank is required to give notice only to shareholders entitled to vote at the meeting.

SB494,76,14 (2) Content of notices. (a) Unless this chapter or the articles of incorporation require otherwise, notice of an annual meeting need not include a description of the purpose for which the meeting is called.

SB494,76,16 (b) Notice of a special meeting shall include a description of each purpose for which the meeting is called.

SB494,76,20 (3) Record date. If not otherwise fixed under s. 221.0517, the record date for determining shareholders entitled to notice of and to vote at an annual or special shareholders' meeting is the close of business on the day before the first notice is given to shareholders.

SB494,76,25 (4) Adjournment. (a) Unless the bylaws require otherwise and except as provided in par. (b), if an annual or special shareholders' meeting is adjourned to a different date, time or place, the bank is not required to give notice of the new date, time or place if the new date, time or place is announced at the meeting before adjournment.

SB494,77,3 (b) If a new record date for an adjourned meeting is or must be fixed under s. 221.0517 (3), the bank shall give notice of the adjourned meeting under this section to persons who are shareholders as of the new record date.

SB494,77,7 221.0515 Disclosure to shareholders. The bank shall include with each notice of an annual meeting delivered to shareholders copies for the 2 preceding fiscal years of the bank's balance sheets, statements of profit and loss and reconcilements of the bank's loan loss reserve.

SB494,77,14 221.0516 Waiver of notice. (1) Written waiver. 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. The waiver shall be in writing and signed by the shareholder entitled to the notice and 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. The shareholder shall deliver the waiver to the bank for inclusion in the bank records.

SB494,77,16 (2) Waiver by attendance. A shareholder's attendance at a meeting, in person or by proxy, waives objection to all of the following:

SB494,77,19 (a) Lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting or promptly upon arrival objects to holding the meeting or transacting business at the meeting.

SB494,77,22 (b) Consideration of a particular matter at the meeting that is not within the purpose described in the meeting notice, unless the shareholder objects to considering the matter when it is presented.

SB494,78,3 221.0517 Record date. (1) Manner of fixing date. The bylaws may fix or provide the manner of fixing a future date as the record date for one or more voting groups in order to determine the shareholders entitled to notice of a shareholders' meeting, to demand a special meeting, to vote or to take any other action. If the bylaws do not fix or provide for fixing a record date, the board of directors may fix a future date as the record date.

SB494,78,5 (2) Limit on date. A record date fixed under this section may not be more than 70 days before the meeting or action requiring a determination of shareholders.

SB494,78,10 (3) Effect of adjournment. (a) Except as provided in par. (b), a determination of shareholders entitled to notice of or to vote at a shareholders' meeting is effective for any adjournment of the meeting unless the board of directors fixes a new record date, which it shall do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting.

SB494,78,13 (b) If a court orders a meeting adjourned to a date more than 120 days after the date fixed for the original meeting, it may provide that the original record date continues in effect or it may fix a new record date.

SB494,78,18 221.0518 Shareholders' list for meeting. (1) Preparation of list. After fixing a record date for a meeting, a bank shall prepare a list of the names of all its shareholders who are entitled to notice of a shareholders' meeting. The list shall be arranged by class or series of shares and show the address of and number of shares held by each shareholder.

SB494,79,2 (2) Availability prior to meeting. The bank shall make the shareholders' list available for inspection by any shareholder, beginning 2 business days after notice of the meeting is given for which the list was prepared and continuing to the date of the meeting, at the bank's principal office or at a place identified in the meeting notice in the city where the meeting will be held. A shareholder or his or her agent or attorney may, on written demand, inspect and copy the list, during regular business hours and at his or her expense, during the period that it is available for inspection under this subsection.

SB494,79,5 (3) Availability at meeting. The bank shall make the shareholders' list available at the meeting. A shareholder or his or her agent or attorney may inspect the list at any time during the meeting or an adjournment.

SB494,79,12 (4) Refusal to allow inspection. If the bank refuses to allow a shareholder or his or her agent or attorney to inspect the shareholders' list before or at the meeting, or to copy the list as permitted by sub. (2), on petition of the shareholder, the circuit court for the county where the bank's principal office is located may, after notice to the bank and an opportunity to be heard, order the inspection or copying at the bank's expense. The court may also postpone the meeting for which the list was prepared until the inspection or copying is complete.

SB494,79,15 (5) Effect of failure to comply. Refusal or failure to prepare or make available the shareholders' list does not affect the validity of action taken at the meeting.

SB494,79,17 221.0519 Proxies. (1) Exercise of vote. A shareholder may vote his or her shares in person or by proxy.

SB494,79,21 (2) Method of appointing a proxy. A shareholder may appoint a proxy to vote or otherwise act for the shareholder by signing an appointment form, either personally or by his or her attorney-in-fact. An appointment of a proxy may be in durable form as provided in s. 243.07.

SB494,79,25 (3) When proxy is effective. An appointment of a proxy is effective when received by an officer or agent of the bank authorized to tabulate votes. An appointment is valid for 11 months from the date of its signing unless a different period is expressly provided in the appointment form.

SB494,80,4 (4) Revocability. (a) An appointment of a proxy is revocable by the shareholder unless the appointment form conspicuously states that it is irrevocable and the appointment is coupled with an interest. Appointments coupled with an interest include the appointment of any of the following:

SB494,80,5 1. A pledgee.

SB494,80,6 2. A person who purchased or agreed to purchase the shares.

SB494,80,8 3. An employe or officer of the bank whose employment contract requires the appointment.

SB494,80,9 4. A party to a voting agreement created under s. 221.0524.

SB494,80,11 (b) An appointment made irrevocable under par. (a) is revoked when the interest with which it is coupled is extinguished.

SB494,80,16 (5) Death or incapacity of shareholder. The death or incapacity of the shareholder appointing a proxy does not affect the right of the bank to accept the proxy's authority unless the officer or agent of the bank authorized to tabulate votes receives notice of the death or incapacity before the proxy exercises his or her authority under the appointment.

SB494,80,22 (6) Revocation in certain cases involving transfers for value. Notwithstanding sub. (4), a transferee for value of shares subject to an irrevocable appointment may revoke the appointment if the transferee did not know of its existence when he or she acquired the shares and the existence of the irrevocable appointment was not noted conspicuously on the certificate representing the shares or, if the shares are without certificates, on the information statement for the shares.

SB494,81,2 (7) Effect of proxy. Subject to s. 221.0521 and to any express limitation on the proxy's authority appearing on the face of the appointment form, a bank may accept the proxy's vote or other action as that of the shareholder making the appointment.

SB494,81,6 221.0520 Shares held by nominees. (1) Establishment of procedures. A bank may establish a procedure by which the beneficial owner of shares that are registered in the name of a nominee is recognized by the bank as the shareholder. The extent of this recognition may be determined in the procedure.

SB494,81,7 (2) Scope of procedures. The procedure may set forth all of the following:

SB494,81,8 (a) The types of nominees to which it applies.

SB494,81,9 (b) The rights or privileges that the bank recognizes in a beneficial owner.

SB494,81,10 (c) The manner in which the nominee selects the procedure.

SB494,81,11 (d) The information that must be provided when the procedure is selected.

SB494,81,12 (e) The period for which selection of the procedure is effective.

SB494,81,13 (f) Other aspects of the rights and duties created.

SB494,81,18 221.0521 Acceptance of instruments showing shareholder action. (1) When name corresponds to that of a shareholder. If the name signed on a vote, consent, waiver or proxy appointment corresponds to the name of a shareholder, the bank, if acting in good faith, may accept the vote, consent, waiver or proxy appointment and give it effect as the act of the shareholder.

SB494,81,23 (2) When name does not correspond to that of a shareholder. If the name signed on a vote, consent, waiver or proxy appointment does not correspond to the name of its shareholder, the bank, if acting in good faith, may accept the vote, consent, waiver or proxy appointment and give it effect as the act of the shareholder if any of the following applies:

SB494,81,25 (a) The shareholder is an entity and the name signed purports to be that of an officer or agent of the entity.

SB494,82,4 (b) The name signed purports to be that of a personal representative, administrator, executor, guardian or conservator representing the shareholder and, if the bank requests, evidence of fiduciary status acceptable to the bank is presented with respect to the vote, consent, waiver or proxy appointment.

SB494,82,7 (c) The name signed purports to be that of a receiver or trustee in bankruptcy of the shareholder and, if the bank requests, evidence of this status acceptable to the bank is presented with respect to the vote, consent, waiver or proxy appointment.

SB494,82,11 (d) The name signed purports to be that of a pledgee, beneficial owner, or attorney-in-fact of the shareholder and, if the bank requests, evidence acceptable to the bank of the signatory's authority to sign for the shareholder is presented with respect to the vote, consent, waiver or proxy appointment.

SB494,82,14 (e) Two or more persons are the shareholder as cotenants or fiduciaries and the name signed purports to be the name of at least one of the coowners and the person signing appears to be acting on behalf of all coowners.

SB494,82,18 (3) When rejection permitted. The bank may reject a vote, consent, waiver or proxy appointment if the officer or agent of the bank who is authorized to tabulate votes, acting in good faith, has reasonable basis for doubt about the validity of the signature on it or about the signatory's authority to sign for the shareholder.

SB494,82,22 (4) Effect on liability. The bank and its officer or agent who accepts or rejects a vote, consent, waiver or proxy appointment in good faith and in accordance with this section are not liable in damages to the shareholder for the consequences of the acceptance or rejection.

SB494,82,25 (5) Effect on validity of action. Bank action based on the acceptance or rejection of a vote, consent, waiver or proxy appointment under this section is valid unless a court of competent jurisdiction determines otherwise.

SB494,83,6 221.0522 Voting for directors; cumulative voting. (1) Plurality vote required. Unless otherwise provided in the articles of incorporation, directors are elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present. In this subsection, "plurality" means that the individuals with the largest number of votes are elected as directors up to the maximum number of directors to be chosen at the election.