CODING: Words stricken are deletions; words underlined are additions.

House Bill 1247

Florida House of Representatives - 1997 HB 1247 By Representatives Boyd, Wise and Murman 1 A bill to be entitled 2 An act relating to corporations; amending s. 3 48.101, F.S.; providing for two kinds of 4 service of process on dissolved corporations 5 depending on the date of dissolution; amending 6 s. 607.01401, F.S.; defining the term "treasury 7 shares"; amending s. 607.0732, F.S.; providing 8 additional requirements with respect to certain 9 shareholder agreements; amending s. 607.1002, 10 F.S.; providing an additional criteria whereby 11 a corporation's board of directors may adopt 12 one or more amendments to the articles of 13 incorporation without shareholder action; 14 amending s. 617.0808, F.S.; deleting reference 15 to the board of directors of certain charitable 16 organizations with respect to the removal of 17 directors; amending s. 617.2103, F.S.; revising 18 language with respect to exemptions for certain 19 corporations; providing an effective date. 20 21 Be It Enacted by the Legislature of the State of Florida: 22 23 Section 1. Section 48.101, Florida Statutes, is 24 amended to read: 25 48.101 Service on dissolved corporations.--Process 26 against the directors of any corporation which was is 27 dissolved before July 1, 1990, as trustees of the dissolved 28 corporation shall be served on one or more of the directors of 29 the dissolved corporation as trustees thereof and binds all of 30 the directors of the dissolved corporation as trustees 31 1 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 1247 590-108-97 1 thereof. Process against any other dissolved corporation shall 2 be served in accordance with s. 48.081. 3 Section 2. Subsections (27) and (28) of section 4 607.01401, Florida Statutes, are renumbered as subsections 5 (28) and (29), respectively, and a new subsection (27) is 6 added to said section to read: 7 607.01401 Definitions.--As used in this act, unless 8 the context otherwise requires, the term: 9 (27) "Treasury shares" means shares of the corporation 10 that belong to the issuing corporation that are authorized and 11 issued shares that are not outstanding, are not canceled, and 12 have not been restored to the status of authorized but 13 unissued shares. 14 Section 3. Paragraphs (f) and (g) of subsection (1) of 15 section 607.0732, Florida Statutes, are amended, and paragraph 16 (h) is added to said subsection, to read: 17 607.0732 Shareholder agreements.-- 18 (1) An agreement among the shareholders of a 19 corporation with 100 or fewer shareholders at the time of the 20 agreement, that complies with this section, is effective among 21 the shareholders and the corporation, even though it is 22 inconsistent with one or more other provisions of this 23 chapter, if it: 24 (f) Transfers to any shareholder or other person any 25 authority to exercise the corporate powers or to manage the 26 business and affairs of the corporation, including the 27 resolution of any issue about which there exists a deadlock 28 among directors or shareholders; or 29 (g) Requires dissolution of the corporation at the 30 request of one or more of the shareholders or upon the 31 occurrence of a specified event or contingency; or 2 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 1247 590-108-97 1 (h) Otherwise governs the exercise of the corporate 2 powers or the management of the business and affairs of the 3 corporation or the relationship among the shareholders, the 4 directors, and the corporation, or among any of them, and is 5 not contrary to public policy. For purposes of this 6 subsection, agreements contrary to public policy include, but 7 are not limited to, agreements that reduce the duties of care 8 and loyalty to the corporation as required by ss. 607.0830 and 9 607.0832, exculpate directors from liability that may be 10 imposed under s. 607.0831, adversely affect the shareholders' 11 rights to bring derivative actions under s. 607.07401, or 12 abrogate dissenters' rights under ss. 607.1301 through 13 607.1320. 14 Section 4. Subsections (7) and (8) of section 15 607.1002, Florida Statutes, are amended, and a new subsection 16 (8) is added to said section, to read: 17 607.1002 Amendment by board of directors.--Unless the 18 articles of incorporation provide otherwise, a corporation's 19 board of directors may adopt one or more amendments to the 20 corporation's articles of incorporation without shareholder 21 action: 22 (7) To change the par value for a class or series of 23 shares; or 24 (8) To provide that if the corporation acquires its 25 own shares, shares so acquired belong to the corporation and 26 constitute treasury shares until disposed of or canceled by 27 the corporation; or 28 (9)(8) To make any other change expressly permitted by 29 this act to be made without shareholder action. 30 Section 5. Section 617.0808, Florida Statutes, is 31 amended to read: 3 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 1247 590-108-97 1 617.0808 Removal of directors.--A director may be 2 removed from office pursuant to procedures provided in the 3 articles of incorporation or the bylaws, which shall provide 4 the following, and if they do not do so, shall be deemed to 5 include the following: 6 (1) Except as provided in subsection (2), Any member 7 of the board of directors may be removed from office with or 8 without cause by the vote or agreement in writing by a 9 majority of all votes of the membership. 10 (2) Any member of the board of directors of a 11 charitable organization as defined in s. 496.404, may be 12 removed from office without cause only following the 13 recommendation of a majority of the board of directors 14 followed by the vote or agreement in writing by a majority of 15 all votes of the membership. 16 (2)(3) The notice of a meeting of the members to 17 recall a member or members of the board of directors shall 18 state the specific directors sought to be removed. 19 (3)(4) A proposed removal of a director at a meeting 20 shall require a separate vote for each board member sought to 21 be removed. Where removal is sought by written agreement, a 22 separate agreement is required for each board member to be 23 removed. 24 (4)(5) If removal is effected at a meeting, any 25 vacancies created thereby shall be filled by the members at 26 the same meeting. 27 (5)(6) Any director who is removed from the board 28 shall not be eligible to stand for reelection until the next 29 annual meeting of the members. 30 31 4 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 1247 590-108-97 1 (6)(7) Any director removed from office shall turn 2 over to the board of directors within 72 hours any and all 3 records of the corporation in his possession. 4 (7)(8) If a director who is removed shall not 5 relinquish his office or turn over records as required under 6 this section, the circuit court in the county where the 7 corporation's principal office is located may summarily order 8 the director to relinquish his office and turn over corporate 9 records upon application of any member. 10 Section 6. Subsection (1) of section 617.2103, Florida 11 Statutes, 1996 Supplement, is amended to read: 12 617.2103 Exemptions for certain corporations.-- 13 (1) No corporation described in s. 501(c) of the 14 Internal Revenue Code of 1986, as amended, shall be subject to 15 the provisions of s. 617.0808, s. 617.1601, s. 617.1602, s. 16 617.1603, s. 617.1604, s. 617.1605, or s. 617.2102, unless the 17 articles of incorporation or bylaws provide otherwise. No 18 corporation described in s. 501(c) of the Internal Revenue 19 Code of 1986, as amended, except a charitable organization as 20 defined in s. 496.404, is subject to the provisions of s. 21 617.0808. For purposes of this subsection, if a current 22 determination letter issued under the authority of the 23 internal revenue laws of the United States of America 24 determines that a particular corporation is or is not exempt 25 from federal income taxation under s. 501(c) of the Internal 26 Revenue Code of 1986, as amended, that shall be conclusive on 27 the question whether the corporation is or is not described in 28 s. 501(c) of the Internal Revenue Code of 1986, as amended. 29 Section 7. This act shall take effect upon becoming a 30 law. 31 5 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 1247 590-108-97 1 ***************************************** 2 HOUSE SUMMARY 3 Provides for service of process on dissolved corporations 4 with a different procedure for corporations dissolved before July 1, 1990, and on or after that date. 5 6 Provides additional criteria whereby an agreement among the shareholders of a corporation with 100 or fewer 7 shareholders is effective among the shareholders, even though inconsistent with one or more provisions of 8 chapter 607, F.S. 9 Provides that unless the articles of incorporation 10 provide otherwise, a corporation's board of directors may adopt one or more amendments to the corporation's 11 articles of incorporation without shareholder action to provide that if the corporation acquires its own shares, 12 shares so acquired belong to the corporation and constitute treasury shares until disposed of or canceled 13 by the corporation. 14 Defines the term "treasury shares" to mean shares of a 15 corporation that belong to the issuing corporation that are authorized and issued shares that are not 16 outstanding, are not canceled, and have not been restored to the status of authorized but unissued shares. 17 18 Deletes reference to the board of directors of a charitable corporation from a provision of law governing 19 the removal of directors. 20 21 22 23 24 25 26 27 28 29 30 31 6