CS/HB 419

1
A bill to be entitled
2An act relating to business entities; amending s.
3607.1109, F.S.; exempting a domestic corporation from the
4requirement to file articles of merger under certain
5circumstances; amending s. 607.1113, F.S.; exempting a
6domestic corporation from the requirement to file a
7certificate of conversion under certain circumstances;
8amending s. 607.1115, F.S.; requiring that each converting
9entity file a certificate of conversion with the
10Department of State; amending s. 608.4382, F.S.; exempting
11a domestic limited liability company from the requirement
12to file a certificate of merger under certain
13circumstances; amending s. 608.439, F.S.; including a
14corporation within the definition of "other business
15entity" or "another business entity"; requiring that each
16converting entity file a certificate of conversion with
17the department; amending s. 608.4403, F.S.; exempting a
18limited liability company from the requirement to file a
19certificate of conversion under certain circumstances;
20amending s. 617.1108, F.S.; exempting a domestic
21corporation not for profit from the requirement to file
22articles of merger under certain circumstances; providing
23for a copy of articles of merger or the certificate of
24merger to be filed in each county in which real property
25of a party to the merger is situated; amending s.
26620.1406, F.S.; revising the requirements for general
27partners with respect to exercising certain management
28rights; providing that the expulsion of a limited partner
29requires the consent of all of the other limited partners;
30amending s. 620.2104, F.S.; requiring that a certificate
31of conversion be signed by each general partner and by the
32converting organization; exempting a limited partnership
33from the requirement to file a certificate of conversion
34if the partnership complies with certain other laws;
35amending s. 620.2108, F.S.; providing exceptions to a
36requirement that constituent limited partnerships file
37articles of merger or a certificate of merger with the
38Department of State; amending s. 620.2204, F.S.; changing
39the date of application of provisions authorizing a
40limited partner to dissociate from a limited partnership;
41amending s. 620.8101, F.S.; redefining the term
42"statement" to exclude a statement of merger; amending s.
43620.8105, F.S.; requiring that a registration statement be
44filed with the department before filing a certificate of
45conversion or a certificate of merger; amending s.
46620.81055, F.S.; providing that a filing fee applies to a
47certificate of merger; amending s. 620.8911, F.S.;
48clarifying that the term "organization" includes a
49converted or surviving organization under certain
50circumstances; amending s. 620.8914, F.S.; revising
51requirements for conversions; exempting converting
52domestic partnerships from filing a certificate of
53conversion under certain circumstances; providing that the
54certificate of conversion acts as a cancellation of the
55registration statement for a converting partnership;
56amending s. 620.8918, F.S.; exempting domestic constituent
57partnerships from filing a certificate of merger under
58certain circumstances; requiring that such partnership
59file a registration statement with the department under
60certain circumstances; amending s. 621.06, F.S.; revising
61limitations on qualifications to render professional
62services; amending s. 621.10, F.S.; revising limitations
63on disqualifications to render professional services;
64amending s. 621.13, F.S.; deleting limitations on mergers
65between domestic and foreign professional corporations and
66limited liability companies; amending s. 727.114, F.S.;
67providing for disposition of residue moneys after payment
68of certain creditors' claims; providing effective dates.
69
70Be It Enacted by the Legislature of the State of Florida:
71
72     Section 1.  Subsection (3) is added to section 607.1109,
73Florida Statutes, to read:
74     607.1109  Articles of merger.--
75     (3)  A domestic corporation is not required to file
76articles of merger pursuant to subsection (1) if the domestic
77corporation is named as a party or constituent organization in
78articles of merger or a certificate of merger filed for the same
79merger in accordance with s. 608.4382(1), s. 617.1108, s.
80620.2108(3), or s. 620.8918(1) and (2), and if the articles of
81merger or certificate of merger substantially complies with the
82requirements of this section. In such a case, the other articles
83of merger or certificate of merger may also be used for purposes
84of subsection (2).
85     Section 2.  Subsection (3) is added to section 607.1113,
86Florida Statutes, to read:
87     607.1113  Certificate of conversion.--
88     (3)  A converting domestic corporation is not required to
89file a certificate of conversion pursuant to subsection (1) if
90the converting domestic corporation files a certificate of
91conversion that substantially complies with the requirements of
92this section pursuant to s. 608.439, s. 620.2104(1)(b), or s.
93620.8914(1)(b) and contains the signatures required by this
94chapter. In such a case, the other certificate of conversion may
95also be used for purposes of subsection (2).
96     Section 3.  Paragraph (a) of subsection (2) of section
97607.1115, Florida Statutes, is amended to read:
98     607.1115  Conversion of another business entity to a
99domestic corporation.--
100     (2)  Any other business entity may convert to a domestic
101corporation if the conversion is permitted by the laws of the
102jurisdiction that enacted the applicable laws governing the
103other business entity and the other business entity complies
104with such laws and the requirements of this section in effecting
105the conversion. The other business entity shall file with the
106Department of State in accordance with s. 607.0120:
107     (a)  A certificate of conversion that has been executed in
108accordance with s. 607.0120 and by the other business entity as
109required by applicable law.
110     Section 4.  Subsection (3) is added to section 608.4382,
111Florida Statutes, to read:
112     608.4382  Certificate of merger.--
113     (3)  A domestic limited liability company is not required
114to file a certificate of merger pursuant to subsection (1) if
115the domestic limited liability company is named as a party or
116constituent organization in articles of merger or a certificate
117of merger filed for the same merger in accordance with s.
118607.1109(1), s. 617.1108, s. 620.2108(3), or s. 620.8918(1) and
119(2), and if the articles of merger or certificate of merger
120substantially complies with the requirements of this section. In
121such a case, the other articles of merger or certificate of
122merger may also be used for purposes of subsection (2).
123     Section 5.  Subsection (1) and paragraph (a) of subsection
124(2) of section 608.439, Florida Statutes, are amended to read:
125     608.439  Conversion of certain entities to a limited
126liability company.--
127     (1)  As used in this section, the term "other business
128entity" or "another business entity" means a corporation; a
129common law or business trust or association; a real estate
130investment trust; a general partnership, including a limited
131liability partnership; a limited partnership, including a
132limited liability limited partnership; or any other domestic or
133foreign entity that is organized under a governing law or other
134applicable law, provided such term shall not include a domestic
135limited liability company.
136     (2)  Any other business entity may convert to a domestic
137limited liability company if the conversion is permitted by the
138laws of the jurisdiction that enacted the statute or other
139applicable law governing the other business entity and the other
140business entity complies with such laws and the requirements of
141this section in effecting the conversion. The other business
142entity shall file with the Department of State in accordance
143with s. 608.4081:
144     (a)  A certificate of conversion that has been executed by
145one or more authorized persons in accordance with s. 608.408,
146and by the other business entity as required by applicable law.
147     Section 6.  Subsection (3) is added to section 608.4403,
148Florida Statutes, to read:
149     608.4403  Certificate of conversion.--
150     (3)  A converting limited liability company is not required
151to file a certificate of conversion pursuant to subsection (1)
152if the converting limited liability company files a certificate
153of conversion that substantially complies with the requirements
154of this section pursuant to s. 607.1115, s. 620.2104(1)(b), or
155s. 620.8914(1)(b) and contains the signatures required by this
156chapter. In such a case, the other certificate of conversion may
157also be used for purposes of subsection (2).
158     Section 7.  Section 617.1108, Florida Statutes, is amended
159to read:
160     617.1108  Merger of domestic corporation and other business
161entities.--
162     (1)  Subject to s. 617.0302(16) and other applicable
163provisions of this chapter, ss. 607.1108, 607.1109, and
164607.11101 shall apply to a merger involving a corporation not
165for profit organized under this act and one or more other
166business entities identified in s. 607.1108(1).
167     (2)  A domestic corporation not for profit organized under
168this chapter is not required to file articles of merger pursuant
169to this section if the corporation not for profit is named as a
170party or constituent organization in articles of merger or a
171certificate of merger filed for the same merger in accordance
172with s. 607.1109, s. 608.4382(1), s. 620.2108(3), or s.
173620.8918(1) and (2). In such a case, the other articles of
174merger or certificate of merger may also be used for purposes of
175subsection (3).
176     (3)  A copy of the articles of merger or certificate of
177merger, certified by the Department of State, may be filed in
178the office of the official who is the recording officer of each
179county in this state in which real property of a party to the
180merger, other than the surviving entity, is situated.
181     Section 8.  Subsections (3), (4), and (5) of section
182620.1406, Florida Statutes, are amended to read:
183     620.1406  Management rights of general partner; approval
184rights of other partners.--
185     (3)  In addition to the approval of the general partners
186required by subsections (1) and (2), the approval of all limited
187partners shall also be required in order to take any of the
188actions under subsection (1) or subsection (2) with the
189exception of a transaction described in paragraph (1)(e), a
190transaction described in paragraph (1)(h), or a transaction
191described in paragraph (1)(i).
192     (4)  The approval of a plan of conversion under s. 620.2103
193or a plan of merger under s. 620.2107 shall also require the
194consent of the limited partners in the manner described therein.
195     (5)  The expulsion of a limited partner described in
196paragraph (1)(e) shall also require the consent of all of the
197other limited partners. A transaction described in paragraph
198(1)(i) shall also require approval of limited partners owning a
199majority of the rights to receive distributions as limited
200partners at the time the consent is to be effective.
201     Section 9.  Subsection (1) of section 620.2104, Florida
202Statutes, is amended to read:
203     620.2104  Filings required for conversion; effective
204date.--
205     (1)  After a plan of conversion is approved:
206     (a)  A converting limited partnership shall deliver to the
207Department of State for filing a certificate of conversion,
208signed by each general partner listed in the certificate of
209limited partnership, and must include:
210     1.  A statement that the limited partnership has been
211converted into another organization.
212     2.  The name and form of the organization and the
213jurisdiction of its governing law.
214     3.  The date the conversion is effective under the
215governing law of the converted organization.
216     4.  A statement that the conversion was approved as
217required by this act.
218     5.  A statement that the conversion was approved as
219required by the governing law of the converted organization.
220     6.  If the converted organization is a foreign organization
221not authorized to transact business in this state, the street
222and mailing address of an office which the Department of State
223may use for the purposes of s. 620.2105(3).
224     (b)  If the converting organization is not a converting
225limited partnership, the converting organization shall deliver
226to the Department of State for filing:
227     1.  A certificate of limited partnership containing the
228information required by s. 620.1201, signed by each general
229partner as required by s. 620.1204(1)(a).
230     2.  A certificate of conversion, signed by each general
231partner listed in the certificate of limited partnership
232submitted in accordance with subparagraph 1. and by the
233converting organization as required by applicable law, which
234certificate of conversion must include:
235     a.  A statement that the limited partnership was converted
236from another organization.
237     b.  The name and form of the converting organization and
238the jurisdiction of its governing law.
239     c.  A statement that the conversion was approved as
240required by this act.
241     d.  A statement that the conversion was approved in a
242manner that complied with the converting organization's
243governing law.
244     (c)  A converting limited partnership is not required to
245file a certificate of conversion pursuant to paragraph (a) if
246the converting limited partnership files a certificate of
247conversion that substantially complies with the requirements of
248this section pursuant to s. 607.1115, s. 608.439, or s.
249620.8914(1)(b) and contains the signatures required by this
250chapter. In such a case, the other certificate of conversion may
251also be used for purposes of s. 620.2105(4).
252     Section 10.  Subsection (3) of section 620.2108, Florida
253Statutes, is amended to read:
254     620.2108  Filings required for merger; effective date.--
255     (3)  Each constituent limited partnership shall deliver the
256certificate of merger for filing in the Department of State
257unless the constituent limited partnership is named as a party
258or constituent organization in articles of merger or a
259certificate of merger filed for the same merger in accordance
260with s. 607.1109(1), s. 608.4382(1), s. 617.1108, or s.
261620.8918(1)and (2) and such articles of merger or certificate of
262merger substantially complies with the requirements of this
263section. In such a case, the other articles of merger or
264certificate of merger may also be used for purposes of s.
265620.2109(3).
266     Section 11.  Paragraph (c) of subsection (3) of section
267620.2204, Florida Statutes, is amended to read:
268     620.2204  Application to existing relationships.--
269     (3)  With respect to a limited partnership formed before
270January 1, 2006, the following rules apply except as the
271partners otherwise elect in the manner provided in the
272partnership agreement or by law for amending the partnership
273agreement:
274     (c)  The provisions of ss. 620.1601 and 620.1602 do not
275apply and a limited partner has the same right and power to
276dissociate from the limited partnership, with the same
277consequences, as existed immediately before January 1, 2006 July
2781, 2005.
279     Section 12.  Subsection (15) of section 620.8101, Florida
280Statutes, is amended to read:
281     620.8101  Definitions.--As used in this act, the term:
282     (15)  "Statement" means a statement of partnership
283authority under s. 620.8303, a statement of denial under s.
284620.8304, a statement of dissociation under s. 620.8704, a
285statement of dissolution under s. 620.8805, a statement of
286merger under s. 620.8918, a statement of qualification under s.
287620.9001, a statement of foreign qualification under s.
288620.9102, or an amendment or cancellation of any of the
289foregoing.
290     Section 13.  Subsection (4) of section 620.8105, Florida
291Statutes, is amended to read:
292     620.8105  Execution, filing, and recording of partnership
293registration and other statements.--
294     (4)  Except as provided in s. 620.8304 or s. 620.8704, a
295statement or a certificate of conversion or certificate of
296merger may be filed with the Department of State only if the
297partnership has filed a registration statement pursuant to
298subsection (1).  If otherwise sufficient, a certified copy of a
299statement that is filed in a jurisdiction other than this state
300may be filed with the Department of State in lieu of an original
301statement.  Any such filing has the effect provided in this act
302with respect to partnership property located in, or transactions
303that occur in, this state.
304     Section 14.  Paragraph (i) of subsection (1) of section
305620.81055, Florida Statutes, is amended to read:
306     620.81055  Fees for filing documents and issuing
307certificates; powers of the Department of State.--
308     (1)  The Department of State shall collect the following
309fees when documents authorized by this act are delivered to the
310Department of State for filing:
311     (i)  Certificate Statement of merger for each party
312thereto:  $25.
313     Section 15.  Subsection (7) of section 620.8911, Florida
314Statutes, is amended to read:
315     620.8911  Definitions.--As used in this section and ss.
316620.8912-620.8923:
317     (7)  "Organization" means a corporation; general
318partnership, including a limited liability partnership; limited
319partnership, including a limited liability limited partnership;
320limited liability company; common law or business trust or
321association; real estate investment trust; or any other person
322organized under a governing law or other applicable law,
323provided such term shall not include an organization that is not
324organized for profit, unless the not-for-profit organization is
325the converted organization in a conversion or the surviving
326organization in a conversion or a merger governed by this act.
327The term includes both domestic and foreign organizations.
328     Section 16.  Section 620.8914, Florida Statutes, is amended
329to read:
330     620.8914  Filings required for conversion; effective
331date.--
332     (1)  After a plan of conversion is approved:
333     (a)  A converting partnership shall deliver to the
334Department of State for filing a statement of registration
335statement in accordance with s. 620.8105, if such statement was
336not previously filed, and a certificate of conversion, in
337accordance with s. 620.8105, which must include:
338     1.  A statement that the partnership has been converted
339into another organization.
340     2.  The name and form of the organization and the
341jurisdiction of its governing law.
342     3.  The date the conversion is effective under the
343governing law of the converted organization.
344     4.  A statement that the conversion was approved as
345required by this act.
346     5.  A statement that the conversion was approved as
347required by the governing law of the converted organization.
348     6.  If the converted organization is a foreign organization
349not authorized to transact business in this state, the street
350and mailing address of an office which the Department of State
351may use for the purposes of s. 620.8915(3).
352     (b)  In the case of a converting organization converting
353into a partnership to be governed by this act, the converting
354organization shall deliver to the Department of State for
355filing:
356     1.  A certificate of registration statement in accordance
357with s. 620.8105.
358     2.  A certificate of conversion, in accordance with s.
359620.8105, signed by a general partner of the partnership in
360accordance with s. 620.8105(6) and by the converting
361organization as required by applicable law, which certificate of
362conversion must include:
363     a.  A statement that the partnership was converted from
364another organization.
365     b.  The name and form of the converting organization and
366the jurisdiction of its governing law.
367     c.  A statement that the conversion was approved as
368required by this act.
369     d.  A statement that the conversion was approved in a
370manner that complied with the converting organization's
371governing law.
372     e.  The effective time of the conversion, if other than the
373time of the filing of the certificate statement of conversion.
374
375A converting domestic partnership is not required to file a
376certificate of conversion pursuant to paragraph (a) if the
377converting domestic partnership files a certificate of
378conversion that substantially complies with the requirements of
379this section pursuant to s. 607.1115, s. 608.439, or s.
380620.2104(1)(b) and contains the signatures required by this
381chapter. In such a case, the other certificate of conversion may
382also be used for purposes of s. 620.8915(4).
383     (2)  A conversion becomes effective:
384     (a)  If the converted organization is a partnership, at the
385time specified in the plan of conversion or the certificate of
386conversion, which may be as of or after the time of the filing
387of the certificate of conversion, and, if the certificate of
388conversion does not contain such an effective time, the
389effective time shall be upon the filing of the certificate of
390conversion with the Department of State. However, provided, if
391the certificate has a delayed effective date, the certificate
392may not be effective any later than the 90th day after the date
393it was filed and provided further, the effective date may shall
394not be any earlier than the effective date of the statement of
395registration statement filed with the Department of State for
396the partnership in accordance with s. 620.8105.
397     (b)  If the converted organization is not a partnership, as
398provided by the governing law of the converted organization.
399
400A certificate of conversion acts as a cancellation of any
401registration statement for a converting partnership for purposes
402of s. 620.8105, and the cancellation shall be deemed filed upon
403the effective date of the conversion.
404     Section 17.  Subsections (3), (4), and (5) of section
405620.8918, Florida Statutes, are amended to read:
406     620.8918  Filings required for merger; effective date.--
407     (3)  Each domestic constituent partnership shall deliver
408the certificate of merger for filing with to the Department of
409State, unless the domestic constituent partnership is named as a
410party or constituent organization in articles of merger or a
411certificate of merger filed for the same merger in accordance
412with s. 607.1109(1), s. 608.4382(1), s. 617.1108, or s.
413620.2108(3). The articles of merger or certificate of merger
414must substantially comply with the requirements of this section.
415In such a case, the other articles of merger or certificate of
416merger may also be used for purposes of s. 620.8919(3). Each
417domestic constituent partnership in the merger shall also file a
418registration statement in accordance with s. 620.8105(1) if it
419does not have a currently effective registration statement filed
420with the Department of State. for filing a statement of
421registration in accordance with s. 620.8105, if such statement
422was not previously filed, and a certificate of merger in
423accordance with s. 620.8105.
424     (4)  A merger becomes effective under this act:
425     (a)  If the surviving organization is a partnership, at the
426time specified in the plan of merger or the certificate of
427merger, which may be as of or after the time of the filing of
428the certificate of merger, and, if the certificate of merger
429does not contain such an effective time, the effective time
430shall be upon the filing of the certificate statement of merger
431with the Department of State. However, provided, if the
432certificate has a delayed effective date, the certificate may
433not be effective any later than the 90th day after the date it
434was filed, and provided further, the effective date may shall
435not be any earlier than the effective date of the statement of
436registration statement filed with the Department of State for
437the partnership in accordance with s. 620.8105.
438     (b)  If the surviving organization is not a partnership, as
439provided by the governing law of the surviving organization.
440     (5)  A certificate of merger acts shall act as a
441cancellation of any statement of registration statement for
442purposes of s. 620.8105 for a partnership that is a party to the
443merger that is not the surviving organization, which
444cancellation shall be deemed filed upon the effective date of
445the merger.
446     Section 18.  Section 621.06, Florida Statutes, is amended
447to read:
448     621.06  Rendition of professional services,
449limitations.--No corporation or limited liability company
450organized under this act may render professional services except
451through its members, officers, employees, and agents who are
452duly licensed or otherwise legally authorized to render such
453professional services within this state; provided, however, this
454provision shall not be interpreted to include in the term
455"employee," as used herein, clerks, secretaries, bookkeepers,
456technicians, and other assistants who are not usually and
457ordinarily considered by custom and practice to be rendering
458professional services to the public for which a license or other
459legal authorization is required; and provided further, that
460nothing contained in this act shall be interpreted to require
461that the right of an individual to be a shareholder of a
462corporation or a member of a limited liability company organized
463under this act, or to organize such a corporation or limited
464liability company, is dependent upon the present or future
465existence of an employment relationship between him or her and
466such corporation or limited liability company, or his or her
467present or future active participation in any capacity in the
468production of the income of such corporation or limited
469liability company or in the performance of the services rendered
470by such corporation or limited liability company.
471     Section 19.  Section 621.10, Florida Statutes, is amended
472to read:
473     621.10  Disqualification of member, shareholder, officer,
474agent, or employee; administrative dissolution.--If any member,
475officer, shareholder, agent, or employee of a corporation or
476limited liability company organized under this chapter who has
477been rendering professional service to the public becomes
478legally disqualified to render such professional services within
479this state or accepts employment that, pursuant to existing law,
480places restrictions or limitations upon that person's continued
481rendering of such professional services, that person shall sever
482all employment with, and financial interests in, such
483corporation or limited liability company forthwith. A
484corporation's or limited liability company's failure to require
485compliance with this provision shall constitute a ground for the
486judicial dissolution of the corporation or limited liability
487company. When a corporation's or limited liability company's
488failure to comply with this provision is brought to the
489attention of the Department of State, the department forthwith
490shall certify that fact to the Department of Legal Affairs for
491appropriate action to dissolve the corporation or limited
492liability company.
493     Section 20.  Subsections(3) and (4) of section 621.13,
494Florida Statutes, are amended to read:
495     621.13  Applicability of chapters 607 and 608.--
496     (3)  A professional corporation or limited liability
497company organized under this act shall exchange shares or merge
498only with other domestic professional corporations or limited
499liability companies organized under this act to render the same
500specific professional service, and a merger or consolidation
501with any foreign corporation or limited liability company is
502prohibited.
503     (3)(4)  A professional corporation or limited liability
504company heretofore or hereafter organized under this act may
505change its business purpose from the rendering of professional
506service to provide for any other lawful purpose by amending its
507certificate of incorporation in the manner required for an
508original incorporation under chapter 607 or by amending its
509certificate of organization in the manner required for an
510original organization under chapter 608. However, such an
511amendment, when filed with and accepted by the Department of
512State, shall remove such corporation or limited liability
513company from the provisions of this chapter including, but not
514limited to, the right to practice a profession. A change of
515business purpose shall not have any effect on the continued
516existence of the corporation or limited liability company.
517     Section 21.  Effective upon this act becoming a law,
518subsection (4) is added to section 727.114, Florida Statutes, to
519read:
520     727.114  Priority of claims.--Allowed claims shall receive
521distribution under this chapter in the following order of
522priority and, with the exception of paragraph (1)(a), on a pro
523rata basis:
524     (4)  If all claims subject to distribution under this
525section have been paid in full, any residue shall be paid to the
526assignor.
527     Section 22.  Except as otherwise expressly provided in this
528act and except for this section, which shall take effect upon
529this act becoming a law, this act shall take effect July 1,
5302008.


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