HB 1035

CS

CHAMBER ACTION

1	The Committee on Commerce recommends the following:
2
3	Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to the Florida Business Corporation Act;
7	amending s. 607.1302, F.S.; clarifying a corporate action
8	entitling a shareholder to certain appraisal rights and
9	payments for shares; creating s. 607.1330, F.S.; providing
10	requirements, procedures, and limitations on court
11	actions; providing for entitlement to certain judgments;
12	requiring corporate payments under certain circumstances;
13	amending s. 607.1407, F.S.; revising certain notice
14	requirements for dissolved corporations; revising a
15	procedure to clarify an exemption for certain claims
16	against dissolved corporations being barred; correcting a
17	cross reference; providing an effective date.
18
19	Be It Enacted by the Legislature of the State of Florida:
20
21	Section 1.  Paragraph (e) of subsection (1) of section
22	607.1302, Florida Statutes, is amended to read:
23	607.1302  Right of shareholders to appraisal.--
24	(1)  A shareholder is entitled to appraisal rights, and to
25	obtain payment of the fair value of that shareholder's shares,
26	in the event of any of the following corporate actions:
27	(e)  With regard to a class of shares prescribed in the
28	articles of incorporation issued prior to October 1, 2003,
29	including any shares within that class subsequently authorized
30	by amendment, any amendment of the articles of incorporation if
31	the shareholder is entitled to vote on the amendment and if such
32	amendment would adversely affect such shareholder by:
33	1.  Altering or abolishing any preemptive rights attached
34	to any of his or her shares;
35	2.  Altering or abolishing the voting rights pertaining to
36	any of his or her shares, except as such rights may be affected
37	by the voting rights of new shares then being authorized of any
38	existing or new class or series of shares;
39	3.  Effecting an exchange, cancellation, or
40	reclassification of any of his or her shares, when such
41	exchange, cancellation, or reclassification would alter or
42	abolish the shareholder's voting rights or alter his or her
43	percentage of equity in the corporation, or effecting a
44	reduction or cancellation of accrued dividends or other
45	arrearages in respect to such shares;
46	4.  Reducing the stated redemption price of any of the
47	shareholder's redeemable shares, altering or abolishing any
48	provision relating to any sinking fund for the redemption or
49	purchase of any of his or her shares, or making any of his or
50	her shares subject to redemption when they are not otherwise
51	redeemable;
52	5.  Making noncumulative, in whole or in part, dividends of
53	any of the shareholder's preferred shares which had theretofore
54	been cumulative;
55	6.  Reducing the stated dividend preference of any of the
56	shareholder's preferred shares; or
57	7.  Reducing any stated preferential amount payable on any
58	of the shareholder's preferred shares upon voluntary or
59	involuntary liquidation.
60	Section 2.  Section 607.1330, Florida Statutes, is created
61	to read:
62	607.1330  Court action.--
63	(1)  If a shareholder makes demand for payment under s.
64	607.1326 which remains unsettled, the corporation shall commence
65	a proceeding within 60 days after receiving the payment demand
66	and petition the court to determine the fair value of the shares
67	and accrued interest. If the corporation does not commence the
68	proceeding within the 60-day period, any shareholder who has
69	made a demand pursuant to s. 607.1326 may commence the
70	proceeding in the name of the corporation.
71	(2)  The proceeding shall be commenced in the appropriate
72	court of the county in which the corporation's principal office,
73	or, if none, its registered office, in this state is located. If
74	the corporation is a foreign corporation without a registered
75	office in this state, the proceeding shall be commenced in the
76	county in this state in which the principal office or registered
77	office of the domestic corporation merged with the foreign
78	corporation was located at the time of the transaction.
79	(3)  All shareholders, whether or not residents of this
80	state, whose demands remain unsettled shall be made parties to
81	the proceeding as in an action against their shares. The
82	corporation shall serve a copy of the initial pleading in such
83	proceeding upon each shareholder party who is a resident of this
84	state in the manner provided by law for the service of a summons
85	and complaint and upon each nonresident shareholder party by
86	registered or certified mail or by publication as provided by
87	law.
88	(4)  The jurisdiction of the court in which the proceeding
89	is commenced under subsection (2) is plenary and exclusive. If
90	it so elects, the court may appoint one or more persons as
91	appraisers to receive evidence and recommend a decision on the
92	question of fair value. The appraisers shall have the powers
93	described in the order appointing them or in any amendment to
94	the order. The shareholders demanding appraisal rights are
95	entitled to the same discovery rights as parties in other civil
96	proceedings. There shall be no right to a jury trial.
97	(5)  Each shareholder made a party to the proceeding is
98	entitled to judgment for the amount of the fair value of such
99	shareholder's shares, plus interest, as found by the court.
100	(6)  The corporation shall pay each such shareholder the
101	amount found to be due within 10 days after final determination
102	of the proceedings. Upon payment of the judgment, the
103	shareholder shall cease to have any interest in the shares.
104	Section 3.  Subsections (2) and (3) of section 607.1407,
105	Florida Statutes, are amended to read:
106	607.1407  Unknown claims against dissolved corporation.--A
107	dissolved corporation or successor entity, as defined in s.
108	607.1406(15), may choose to execute one of the following
109	procedures to resolve payment of unknown claims.
110	(2)  A dissolved corporation or successor entity may,
111	within 10 days after filing of adopting the articles of
112	dissolution with the Department of State, publish a "Notice of
113	Corporate Dissolution." The notice shall appear once a week for
114	2 consecutive weeks in a newspaper of general circulation in a
115	county in the state in which wherein the corporation has its
116	principal office, if any, or, if none, in a county in the state
117	in which the corporation owns real or personal property. Such
118	newspaper shall meet the requirements as are prescribed by law
119	for such purposes. The notice shall:
120	(a)  State the name of the corporation and the date of
121	dissolution;
122	(b)  Describe the information that must be included in a
123	claim and provide a mailing address to which the claim may be
124	sent; and
125	(c)  State that a claim against the corporation under this
126	subsection will be barred unless a proceeding to enforce the
127	claim is commenced within 4 years after the date of the second
128	consecutive weekly publication filing of the notice authorized
129	by this section.
130	(3)  If the dissolved corporation or successor entity
131	complies with subsection (1) or subsection (2), the claim of
132	each of the following claimants is barred unless the claimant
133	commences a proceeding to enforce the claim against the
134	dissolved corporation within 4 years after the filing date of
135	filing the notice with the Department of State or the date of
136	the second consecutive weekly publication, as applicable:
137	(a)  A claimant who did not receive written notice under s.
138	607.1406(9), or whose claim was not provided for under s.
139	607.1406(10) 607.1456(10), whether such claim is based on an
140	event occurring before or after the effective date of
141	dissolution.
142	(b)  A claimant whose claim was timely sent to the
143	dissolved corporation but on which no action was taken.
144	Section 4.  This act shall take effect upon becoming a law.

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