Florida Senate - 2008 COMMITTEE AMENDMENT

Bill No. SB 304

547184

CHAMBER ACTION

Senate

Comm: RCS

3/11/2008

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House



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The Committee on Commerce (Justice) recommended the following

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amendment:

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     Senate Amendment (with title amendment)

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     Delete everything after the enacting clause

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and insert:

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     Section 1.  Subsections (4), (6), and (9) of section

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617.01201, Florida Statutes, are amended to read:

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     617.01201  Filing requirements.--

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     (4)  The document must be typewritten or printed and must

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be legible. If electronically transmitted, the document must be

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in a format that may be retrieved or reproduced in typewritten

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or printed form.

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     (6)  The document must be executed:

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     (a) By a director the chair or any vice chair of the board

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of directors of a domestic or foreign corporation, or by its

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president or by another of its officers;

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     (b) If directors or officers have not been selected or the

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corporation has not been formed, by an incorporator; or

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     (c)  If the corporation is in the hands of a receiver,

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trustee, or other court-appointed fiduciary, by the that

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fiduciary.

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     (9) The document must be delivered to the office of the

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department of State for filing. Delivery may be made by

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electronic transmission if and to the extent allowed by the

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department. If the document is filed in typewritten or printed

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form and not transmitted electronically, the department may

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require that and may be accompanied by one exact or conformed

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copy be delivered with the document, (except as provided in s.

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617.1508. The document), and must be accompanied by the correct

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filing fee and any other tax or penalty required by this act or

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other law.

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     Section 2.  Subsection (7) of section 617.0122, Florida

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Statutes, is amended to read:

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     617.0122  Fees for filing documents and issuing

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certificates.--The Department of State shall collect the

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following fees on documents delivered to the department for

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filing:

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     (7) Agent's statement of resignation from inactive

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administratively dissolved corporation: $35.

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Any citizen support organization that is required by rule of the

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Department of Environmental Protection to be formed as a

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nonprofit organization and is under contract with the department

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is exempt from any fees required for incorporation as a

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nonprofit organization, and the Secretary of State may not

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assess any such fees if the citizen support organization is

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certified by the Department of Environmental Protection to the

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Secretary of State as being under contract with the Department

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of Environmental Protection.

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     Section 3.  Subsections (1) and (2) of section 617.0124,

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Florida Statutes, are amended to read:

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     617.0124  Correcting filed document.--

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     (1)  A domestic or foreign corporation may correct a

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document filed by the department of State within 30 10 business

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days after filing if the document:

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     (a) The document contains an incorrect statement; or

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     (b) The document was defectively executed, attested,

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sealed, verified, or acknowledged; or.

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     (c) The electronic transmission of the document was

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defective.

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     (2)  A document is corrected:

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     (a)  By preparing articles of correction that:

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     1. Describe the document, (including its filing date) or

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attach a copy of it to the articles;

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     2.  Specify the incorrect statement and the reason it is

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incorrect or the manner in which the execution was defective;

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and

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     3.  Correct the incorrect statement or defective execution;

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and

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     (b)  By delivering the executed articles of correction to

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the department of State for filing.

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     Section 4.  Section 617.01401, Florida Statutes, is amended

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to read:

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     617.01401 Definitions.--As used in this chapter act,

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unless the context otherwise requires, the term:

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     (1)  "Articles of incorporation" includes original,

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amended, and restated articles of incorporation, articles of

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consolidation, and articles of merger, and all amendments

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thereto, including documents designated by the laws of this

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state as charters, and, in the case of a foreign corporation,

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documents equivalent to articles of incorporation in the

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jurisdiction of incorporation.

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     (2)  "Board of directors" means the group of persons vested

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with the management of the affairs of the corporation

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irrespective of the name by which such group is designated,

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including, but not limited to, managers or trustees.

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     (3)  "Bylaws" means the code or codes of rules adopted for

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the regulation or management of the affairs of the corporation

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irrespective of the name or names by which such rules are

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designated.

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     (4)  "Corporation" or "domestic corporation" means a

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corporation not for profit, subject to the provisions of this

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chapter act, except a foreign corporation.

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     (5)  "Corporation not for profit" means a corporation no

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part of the income or profit of which is distributable to its

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members, directors, or officers, except as otherwise provided

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under this chapter.

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     (6) "Department" means the Department of State.

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     (7) "Distribution" means the payment of a dividend or any

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part of the income or profit of a corporation to its members,

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directors, or officers. A donation or transfer of corporate

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assets or income to or from another not-for-profit corporation

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qualified as tax-exempt under s. 501(c) of the Internal Revenue

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Code or a governmental organization exempt from federal and

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state income taxes, if such corporation or governmental

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organization is a member of the corporation making such donation

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or transfer, is not a distribution for purposes of this chapter.

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     (8)(6) "Electronic transmission" means any form of

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communication, not directly involving the physical transmission

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or transfer of paper, which creates a record that may be

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retained, retrieved, and reviewed by a recipient thereof and

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which may be directly reproduced in a comprehensible and legible

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paper form by such recipient through an automated process.

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Examples of electronic transmission include, but are not limited

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to, telegrams, facsimile transmissions of images, and text that

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is sent via electronic mail between computers.

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     (9)(7) "Foreign corporation" means a corporation not for

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profit organized under laws other than the laws of this state.

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     (10)(8) "Insolvent" means the inability of a corporation

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to pay its debts as they become due in the usual course of its

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affairs.

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     (11)(9) "Mail" means the United States mail, facsimile

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transmissions, and private mail carriers handling nationwide

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mail services.

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     (12)(10) "Member" means one having membership rights in a

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corporation in accordance with the provisions of its articles of

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incorporation or bylaws or the provisions of this chapter act.

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     (13) "Mutual benefit corporation" means a domestic

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corporation that is not organized primarily or exclusively for

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religious purposes; is not recognized as exempt under s.

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501(c)(3) of the Internal Revenue Code, or the corresponding

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section of a subsequently enacted federal revenue act; and is

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not organized for a public or charitable purpose that is

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required upon its dissolution to distribute its assets to the

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United States, a state, a local subdivision thereof, or a person

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that is recognized as exempt under s. 501(c)(3) of the Internal

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Revenue Code, or the corresponding section of a subsequently

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enacted federal revenue act. The term does not include an

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association organized under chapter 718, chapter 719, chapter

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720, or chapter 721, or any corporation where membership in the

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corporation is required pursuant to a document recorded in

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county property records.

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     (14)(11) "Person" includes individual and entity.

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     (15) "Successor entity" means any trust, receivership, or

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other legal entity that is governed by the laws of this state to

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which the remaining assets and liabilities of a dissolved

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corporation are transferred and that exists solely for the

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purposes of prosecuting and defending suits by or against the

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dissolved corporation and enabling the dissolved corporation to

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settle and close the business of the dissolved corporation, to

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dispose of and convey the property of the dissolved corporation,

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to discharge the liabilities of the dissolved corporation, and

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to distribute to the dissolved corporation's members any

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remaining assets, but not for the purpose of continuing the

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business for which the dissolved corporation was organized.

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     (16) "Voting power" means the total number of votes

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entitled to be cast for the election of directors at the time

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the determination of voting power is made, excluding a vote that

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is contingent upon the happening of a condition or event that

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has not yet occurred. If the members of a class are entitled to

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vote as a class to elect directors, the determination of the

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voting power of the class is based on the percentage of the

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number of directors the class is entitled to elect relative to

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the total number of authorized directors. If the corporation's

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directors are not elected by the members, voting power shall,

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unless otherwise provided in the articles of incorporation or

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bylaws, be on a one-member, one-vote basis.

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     Section 5.  Subsection (1) of section 617.0205, Florida

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Statutes, is amended to read:

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     617.0205  Organizational meeting of directors.--

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     (1)  After incorporation:

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     (a)  If initial directors are named in the articles of

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incorporation, the initial directors shall hold an

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organizational meeting, at the call of a majority of the

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directors, to complete the organization of the corporation by

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appointing officers, adopting bylaws, and carrying on any other

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business brought before the meeting;

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     (b) If initial directors are not named in the articles of

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incorporation, the incorporators shall hold an organizational

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meeting at the call of a majority of the incorporators:

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     1.  To elect directors and complete the organization of the

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corporation; or

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     2.  To elect a board of directors who shall complete the

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organization of the corporation.

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     Section 6.  Subsections (7) and (16) of section 617.0302,

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Florida Statutes, are amended to read:

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     617.0302  Corporate powers.--Every corporation not for

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profit organized under this act, unless otherwise provided in

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its articles of incorporation or bylaws, shall have power to:

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     (7) Make contracts and guaranties, incur liabilities,

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borrow money at such rates of interest as the corporation may

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determine, issue its notes, bonds, and other obligations, and

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secure any of its obligations by mortgage and pledge of all or

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any of its property, franchises, or income.

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     (16)  Merge with other corporations or other business

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entities identified in s. 607.1108(1), both for profit and not

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for profit, domestic and foreign, if the surviving corporation

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or other surviving business entity is a corporation not for

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profit or other business entity that has been organized as a

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not-for-profit entity under a governing statute or other

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applicable law that permits such a merger.

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     Section 7.  Subsection (12) is added to section 617.0503,

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Florida Statutes, to read:

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     617.0503  Registered agent; duties; confidentiality of

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investigation records.--

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     (12) Any alien business organization may withdraw its

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registered agent designation by delivering an application for

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certificate of withdrawal to the department for filing. The

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application shall set forth:

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     (a) The name of the alien business organization and the

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jurisdiction under the law of which it is incorporated or

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organized; and

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     (b) That it is no longer required to maintain a registered

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agent in this state.

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     Section 8.  Section 617.0505, Florida Statutes, is amended

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to read:

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     617.0505 Distributions; exceptions Payment of dividends

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and distribution of income to members prohibited; issuance of

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certificates of membership; effect of stock issued under prior

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law.--

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     (1) Except as authorized in s. 617.1302, A dividend may

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not be paid, and any part of the income or profit of a

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corporation may not make distributions be distributed, to its

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members, directors, or officers.

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     (1) A mutual benefit corporation, such as a private club

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that is established for social, pleasure, or recreational

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purposes and that is organized as a corporation of which the

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equity interests are held by the members, may, subject to s.

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617.1302, purchase the equity membership interest of any member,

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and the payment for such interest is not a distribution for

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purposes of this section.

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     (2) A corporation may pay compensation in a reasonable

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amount to its members, directors, or officers for services

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rendered, may confer benefits upon its members in conformity

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with its purposes, and, upon dissolution or final liquidation,

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may make distributions to its members as permitted by this

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chapter act.

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     (3) If expressly permitted by its articles of

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incorporation, a corporation may make distributions upon partial

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liquidation to its members, as permitted by this section. Any

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such payment, benefit, or distribution does not constitute a

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dividend or a distribution of income or profit for purposes of

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this section.

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     (4) A Any corporation that which is a utility exempt from

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regulation under s. 367.022(7), whose articles of incorporation

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state that it is exempt from taxation under s. 501(c)(12) of the

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Internal Revenue Code or the corresponding section of a

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subsequently enacted federal revenue act, may make such refunds

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to its members, prior to a dissolution or liquidation, as its

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managing board deems necessary to establish or preserve its tax-

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exempt status. Any such refund does not constitute a dividend or

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a distribution of income or profit for purposes of this section.

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     (5) A corporation that is regulated by chapter 718,

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chapter 719, chapter 720, chapter 721, or chapter 723, or a

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corporation where membership in such corporation is required

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pursuant to a document recorded in the county property records,

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may make refunds to its members, giving credits to its members,

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disbursing insurance proceeds to its members, or disbursing or

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paying settlements to its members without violating this

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section.

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     (2) Subject to subsection (1), a corporation may issue

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certificates in any form evidencing membership in the

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corporation.

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     (3) Stock certificates issued under former s. 617.011(2),

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Florida Statutes (1989), constitute membership certificates for

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purposes of this act.

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     Section 9.  Subsections (1), (2), and (5) of section

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617.0601, Florida Statutes, are amended to read:

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     617.0601  Members, generally.--

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     (1)(a)  A corporation may have one or more classes of

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members or may have no members.  If the corporation has one or

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more classes of members, the designation of such class or

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classes, the qualifications and rights of the members of each

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class, any quorum and voting requirements for meetings and

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activities of the members, and notice requirements sufficient to

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provide notice of meetings and activities of the members must be

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set forth in the articles of incorporation or in the bylaws.

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     (b)  The articles of incorporation or bylaws of any

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corporation not for profit that maintains chapters or affiliates

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may grant representatives of such chapters or affiliates the

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right to vote in conjunction with the board of directors of the

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corporation notwithstanding applicable quorum or voting

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requirements of this chapter act if the corporation is

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registered with the department of State pursuant to ss. 496.401-

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496.424 ss. 496.001-496.011, the Solicitation of Contributions

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Funds Act.

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     (c)  This subsection does not apply to any condominium

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association organized under chapter 718.

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     (2)  A corporation may issue certificates of membership.

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Stock certificates issued under former s. 617.011(2), Florida

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Statutes (1989), constitute certificates of membership for

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purposes of this section.

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     (5) Membership in the corporation may be terminated in the

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manner provided by law, by the articles of incorporation, or by

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the bylaws, and A resignation, expulsion, or termination of

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membership pursuant to s. 617.0606 or s. 617.0607 shall be

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recorded in the membership book.  Unless otherwise provided in

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the articles of incorporation or the bylaws, all the rights and

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privileges of a member cease on termination of membership.

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     Section 10.  Section 617.0605, Florida Statutes, is created

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to read:

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     617.0605 Transfer of membership interests.--

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     (1) A member of a corporation may not transfer a

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membership or any right arising from membership except as

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otherwise allowed in this section.

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     (2) Except as set forth in the articles of incorporation

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or bylaws of a mutual benefit corporation, a member of a mutual

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benefit corporation may not transfer a membership or any right

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arising from membership.

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     (3) If transfer rights have been provided for one or more

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members of a mutual benefit corporation, a restriction on such

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rights is not binding with respect to a member holding a

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membership issued before the adoption of the restriction unless

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the restriction is approved by the members and the affected

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member.

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     Section 11.  Section 617.0606, Florida Statutes, is created

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to read:

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     617.0606 Resignation of members.--

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     (1) Except as may be provided in the articles of

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incorporation or bylaws of a corporation, a member of a mutual

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benefit corporation may not transfer a membership or any right

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arising from membership.

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     (2) The resignation of a member does not relieve the

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member from any obligations that the member may have to the

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corporation as a result of obligations incurred or commitments

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made before resignation.

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     Section 12.  Section 617.0607, Florida Statutes, is created

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to read:

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     617.0607 Termination, expulsion, and suspension.--

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     (1) A member of a corporation may not be expelled or

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suspended, and a membership in the corporation may not be

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terminated or suspended, except pursuant to a procedure that is

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fair and reasonable and is carried out in good faith.

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     (2) Any written notice given by mail must be delivered by

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certified mail or first-class mail to the last address of the

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member shown on the records of the corporation.

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     (3) Any proceeding challenging an expulsion, suspension,

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or termination, including a proceeding in which the defective

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notice is alleged, must be commenced within 1 year after the

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effective date of the expulsion, suspension, or termination.

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     (4) A member who has been expelled or suspended may be

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liable to the corporation for dues, assessments, or fees as a

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result of obligations incurred or commitments made before

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expulsion or suspension.

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     Section 13.  Section 617.0608, Florida Statutes, is created

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to read:

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     617.0608 Purchase of memberships.--

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     (1) A corporation may not purchase any of its memberships

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or any right arising from membership except as provided in s.

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617.0505 or subsection (2).

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     (2) Subject to s. 617.1302, a mutual benefit corporation

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may purchase the membership of a member who resigns, or whose

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membership is terminated, for the amount and pursuant to the

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conditions set forth in its articles of incorporation or bylaws.

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     Section 14.  Subsections (3), (4), and (6) of section

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617.0701, Florida Statutes, are amended to read:

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     617.0701  Meetings of members, generally; failure to hold

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annual meeting; special meeting; consent to corporate actions

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without meetings; waiver of notice of meetings.--

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     (3) Except as provided in the articles of incorporation or

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bylaws, special meetings of the members may be called by:

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     (a) The president;,

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     (b) The chair of the board of directors;,

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     (c) The board of directors;, or such

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     (d) Other officers or persons as are provided for in the

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articles of incorporation or the bylaws;.

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     (e) The holders of at least 5 percent of the voting power

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of a corporation when one or more written demands for the

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meeting, which describe the purpose for which the meeting is to

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be held, are signed, dated, and delivered to a corporate

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officer; or

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     (f) A person who signs a demand for a special meeting

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pursuant to paragraph (e) if notice for a special meeting is not

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given within 30 days after receipt of the demand. The person

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signing the demand may set the time and place of the meeting and

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give notice under this subsection.

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     (4)(a) Unless otherwise provided in the articles of

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incorporation, action required or permitted by this chapter act

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to be taken at an annual or special meeting of members may be

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taken without a meeting, without prior notice, and without a

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vote if the action is taken by the members entitled to vote on

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such action and having not less than the minimum number of votes

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necessary to authorize such action at a meeting at which all

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members entitled to vote on such action were present and voted.

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     (a) In order To be effective, the action must be evidenced

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by one or more written consents describing the action taken,

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dated and signed by approving members having the requisite

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number of votes and entitled to vote on such action, and

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delivered to the corporation by delivery to its principal office

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in this state, its principal place of business, the corporate

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secretary, or another officer or agent of the corporation having

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custody of the book in which proceedings of meetings of members

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are recorded. Written consent shall not be effective to take the

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corporate action referred to in the consent is not effective

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unless the consent is signed by members having the requisite

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number of votes necessary to authorize the action within 90 60

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days after of the date of the earliest dated consent and is

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delivered in the manner required by this section.

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     (b)  Any written consent may be revoked prior to the date

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that the corporation receives the required number of consents to

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authorize the proposed action. A revocation is not effective

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unless in writing and until received by the corporation at its

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principal office in this state or its principal place of

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business, or received by the corporate secretary or other

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officer or agent of the corporation having custody of the book

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in which proceedings of meetings of members are recorded.

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     (c) Within 30 10 days after obtaining such authorization

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by written consent, notice must be given to those members who

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are entitled to vote on the action but who have not consented in

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writing.  The notice must fairly summarize the material features

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of the authorized action.

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     (d)  A consent signed under this section has the effect of

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a meeting vote and may be described as such in any document.

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     (e)  If the action to which the members consent is such as

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would have required the filing of articles or a certificate

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under any other section of this chapter act if such action had

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been voted on by members at a meeting thereof, the articles or

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certificate filed under such other section must state that

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written consent has been given in accordance with the provisions

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of this section.

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     (f)  Whenever action is taken pursuant to this section, the

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written consent of the members consenting to such action or the

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written reports of inspectors appointed to tabulate such

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consents must be filed with the minutes of member proceedings of

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members.

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     (6)  Subsections (1) and (3) do not apply to any

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corporation that is an association as defined in s. 720.301, or

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a corporation regulated by chapter 718, chapter 719, chapter

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720, chapter 721, or chapter 723, or a corporation where

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membership in such corporation is required pursuant to a

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document recorded in the county property records.

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     Section 15.  Section 617.0721, Florida Statutes, is amended

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to read:

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     617.0721  Voting by members.--

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     (1)  Members are not entitled to vote except as conferred

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by the articles of incorporation or the bylaws.

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     (2)  A member who is entitled to vote may vote in person

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or, unless the articles of incorporation or the bylaws otherwise

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provide, may vote by proxy executed in writing by the member or

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by his or her duly authorized attorney in fact. An appointment

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of a proxy is not valid after 11 months following the date of

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its execution unless otherwise provided in the proxy.

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     (a) If directors or officers are to be elected by members,

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the bylaws may provide that such elections may be conducted by

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mail.

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     (b) A corporation may reject a vote, consent, waiver, or

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proxy appointment if the secretary or other officer or agent

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authorized to tabulate votes, acting in good faith, has a

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reasonable basis for doubting the validity of the signature on

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it or the signatory's authority to sign for the member.

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     (3) If authorized by the board of directors, and subject

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to such guidelines and procedures as the board of directors may

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adopt, members and proxy holders who are not physically present

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at a meeting may, by means of remote communication:

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     (a) Participate in the meeting.

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     (b) Be deemed to be present in person and vote at the

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meeting if:

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     1. The corporation implements reasonable means to verify

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that each person deemed present and authorized to vote by means

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of remote communication is a member or proxy holder; and

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     2. The corporation implements reasonable measures to

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provide such members or proxy holders with a reasonable

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opportunity to participate in the meeting and to vote on matters

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submitted to the members, including an opportunity to

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communicate and to read or hear the proceedings of the meeting

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substantially concurrent with the proceedings.

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If any member or proxy holder votes or takes other action by

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means of remote communication, a record of that member's

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participation in the meeting must be maintained by the

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corporation in accordance with s. 617.1601.

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     (4)(3) If any corporation, whether for profit or not for

475

profit, is a member of a corporation organized under this

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chapter act, the chair of the board, president, any vice

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president, the secretary, or the treasurer of the member

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corporation, and any such officer or cashier or trust officer of

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a banking or trust corporation holding such membership, and any

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like officer of a foreign corporation whether for profit or not

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for profit, holding membership in a domestic corporation, shall

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be deemed by the corporation in which membership is held to have

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the authority to vote on behalf of the member corporation and to

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execute proxies and written waivers and consents in relation

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thereto, unless, before a vote is taken or a waiver or consent

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is acted upon, it appears pursuant to is made to appear by a

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certified copy of the bylaws or resolution of the board of

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directors or executive committee of the member corporation that

489

such authority does not exist or is vested in some other officer

490

or person. In the absence of such certification, a person

491

executing any such proxies, waivers, or consents or presenting

492

himself or herself at a meeting as one of such officers of a

493

corporate member shall be, for the purposes of this section,

494

conclusively deemed to be duly elected, qualified, and acting as

495

such officer and to be fully authorized. In the case of

496

conflicting representation, the corporate member shall be deemed

497

to be represented by its senior officer, in the order first

498

stated in this subsection.

499

     (5)(4) The articles of incorporation or the bylaws may

500

provide that, in all elections for directors, every member

501

entitled to vote has the right to cumulate his or her votes and

502

to give one candidate a number of votes equal to the number of

503

votes he or she could give if one director were being elected

504

multiplied by the number of directors to be elected or to

505

distribute such votes on the same principles among any number of

506

such candidates. A corporation may not have cumulative voting

507

unless such voting is expressly authorized in the articles of

508

incorporation.

509

     (6)(5) If a corporation has no members or its members do

510

not have the right to vote, the directors shall have the sole

511

voting power.

512

     (7)(6) Subsections (1), (2), (5) (4), and (6) (5) do not

513

apply to a corporation that is an association as defined in s.

514

720.301.

515

     Section 16.  Section 617.0725, Florida Statutes, is amended

516

to read:

517

     617.0725  Quorum.--An amendment to the articles of

518

incorporation or the bylaws which adds, that changes, or deletes

519

a greater or lesser quorum or voting requirement must meet the

520

same quorum or voting requirement and be adopted by the same

521

vote and voting groups required to take action under the quorum

522

and voting requirements then in effect or proposed to be

523

adopted, whichever is greater prescribed in the provision being

524

amended.

525

     Section 17.  Section 617.07401, Florida Statutes, is

526

created to read:

527

     617.07401 Members' derivative actions.--

528

     (1) A person may not commence a proceeding in the right of

529

a domestic or foreign corporation unless the person was a member

530

of the corporation when the transaction complained of occurred

531

or unless the person became a member through transfer by

532

operation of law from one who was a member at that time.

533

     (2) A complaint in a proceeding brought in the right of a

534

domestic or foreign corporation must be verified and allege with

535

particularity the demand made to obtain action by the board of

536

directors and that the demand was refused or ignored by the

537

board of directors for at least 90 days after the date of the

538

first demand unless, before the expiration of the 90 days, the

539

person was notified in writing that the corporation rejected the

540

demand, or unless irreparable injury to the corporation would

541

result by waiting for the expiration of the 90-day period. If

542

the corporation commences an investigation of the charges made

543

in the demand or complaint, the court may stay any proceeding

544

until the investigation is completed.

545

     (3) The court may dismiss a derivative proceeding if, on

546

motion by the corporation, the court finds that one of the

547

groups specified in paragraphs (a)-(c) has made a good faith

548

determination after conducting a reasonable investigation upon

549

which its conclusions are based that the maintenance of the

550

derivative suit is not in the best interests of the corporation.

551

The corporation has the burden of proving the independence and

552

good faith of the group making the determination and the

553

reasonableness of the investigation. The determination shall be

554

made by:

555

     (a) A majority vote of independent directors present at a

556

meeting of the board of directors, if the independent directors

557

constitute a quorum;

558

     (b) A majority vote of a committee consisting of two or

559

more independent directors appointed by a majority vote of

560

independent directors present at a meeting of the board of

561

directors, whether or not such independent directors constitute

562

a quorum; or

563

     (c) A panel of one or more independent persons appointed

564

by the court upon motion by the corporation.

565

     (4) A proceeding commenced under this section may not be

566

discontinued or settled without the approval of the court. If

567

the court determines that a proposed discontinuance or

568

settlement substantially affects the interest of the members of

569

the corporation, or a class, series, or voting group of members,

570

the court shall direct that notice be given to the members

571

affected. The court may determine which party or parties to the

572

proceeding shall bear the expense of giving the notice.

573

     (5) Upon termination of the proceeding, the court may

574

require the plaintiff to pay any defendant's reasonable

575

expenses, including reasonable attorney's fees, incurred in

576

defending the proceeding if it finds that the proceeding was

577

commenced without reasonable cause.

578

     (6) The court may award reasonable expenses for

579

maintaining the proceeding, including reasonable attorney's

580

fees, to a successful plaintiff or to the person commencing the

581

proceeding who receives any relief, whether by judgment,

582

compromise, or settlement, and may require that the person

583

account for the remainder of any proceeds to the corporation;

584

however, this subsection does not apply to any relief rendered

585

for the benefit of injured members only and limited to a

586

recovery of the loss or damage of the injured members.

587

     Section 18.  Section 617.0801, Florida Statutes, is amended

588

to read:

589

     617.0801 Requirement for and Duties of board of

590

directors.--All corporate powers must be exercised by or under

591

the authority of, and the affairs of the corporation managed

592

under the direction of, its board of directors, subject to any

593

limitation set forth in the articles of incorporation.

594

     Section 19.  Section 617.0806, Florida Statutes, is amended

595

to read:

596

     617.0806 Staggered terms for directors.--The articles of

597

incorporation or bylaws may provide that directors may be

598

divided into classes and the terms of office of the several

599

classes need not be uniform. Each director shall hold office for

600

the term to which he or she is elected or appointed and until

601

his or her successor has been elected or appointed and qualified

602

or until his or her earlier resignation, removal from office, or

603

death.

604

     Section 20.  Section 617.0808, Florida Statutes, is amended

605

to read:

606

     617.0808  Removal of directors.--

607

     (1) Subject to subsection (2), a director may be removed

608

from office pursuant to procedures provided in the articles of

609

incorporation or the bylaws, which shall provide the following,

610

and if they do not do so, shall be deemed to include the

611

following:

612

     (a)(1) Any member of the board of directors may be removed

613

from office with or without cause by:

614

     1. A majority of all votes of the directors, if the

615

director was elected or appointed by the directors; or

616

     2. A majority of all votes of the members, if the director

617

was elected or appointed by the members.

618

     (b) If a director is elected by a class, chapter, or other

619

organizational unit, or by region or other geographic grouping,

620

the director may be removed only by the members of that class,

621

chapter, unit, or grouping. However:

622

     1. A director may be removed only if the number of votes

623

cast to remove the director would be sufficient to elect the

624

director at a meeting to elect directors, except as provided in

625

subparagraphs 2. and 3.

626

     2. If cumulative voting is authorized, a director may not

627

be removed if the number of votes sufficient to elect the

628

director under cumulative voting is voted against the removal of

629

the director.

630

     3. If at the beginning of the term of a director the

631

articles of incorporation or bylaws provide that the director

632

may be removed for missing a specified number of board meetings,

633

the board may remove the director for failing to attend the

634

specified number of meetings. The director may be removed only

635

if a majority of the directors then in office vote for the

636

removal the vote or agreement in writing by a majority of all

637

votes of the membership.

638

     (c)(2) The notice of a meeting of the members to recall a

639

member or members of the board of directors shall state the

640

specific directors sought to be removed.

641

     (d)(3) A proposed removal of a director at a meeting shall

642

require a separate vote for each director whose removal is board

643

member sought to be removed. Where removal is sought by written

644

consent agreement, a separate consent agreement is required for

645

each director board member to be removed.

646

     (e)(4) If removal is effected at a meeting, any vacancies

647

created thereby shall be filled by the members or directors

648

eligible to vote for the removal at the same meeting.

649

     (f)(5) Any director who is removed from the board is shall

650

not be eligible to stand for reelection until the next annual

651

meeting at which directors are elected of the members.

652

     (g)(6) Any director removed from office shall turn over to

653

the board of directors within 72 hours any and all records of

654

the corporation in his or her possession.

655

     (h)(7) If a director who is removed does shall not

656

relinquish his or her office or turn over records as required

657

under this section, the circuit court in the county where the

658

corporation's principal office is located may summarily order

659

the director to relinquish his or her office and turn over

660

corporate records upon application of any member.

661

     (i) A director elected or appointed by the board may be

662

removed without cause by a vote of two-thirds of the directors

663

then in office or such greater number as is set forth in the

664

articles of incorporation or bylaws.

665

     (2) A director of a corporation described in s. 501(c) of

666

the Internal Revenue Code may be removed from office pursuant to

667

procedures provided in the articles of incorporation or the

668

bylaws, and the corporation may provide in the articles of

669

incorporation or the bylaws that it is subject to the provisions

670

of subsection (1).

671

     Section 21.  Section 617.0809, Florida Statutes, is amended

672

to read:

673

     617.0809 Board vacancy on board.--

674

     (1) Except as provided in s. 617.0808(1)(f), any vacancy

675

occurring on the board of directors may be filled by the

676

affirmative vote of the majority of the remaining directors,

677

even though the remaining directors constitute less than a

678

quorum, or by the sole remaining director, as the case may be,

679

or, if the vacancy is not so filled or if no director remains,

680

by the members or, on the application of any person, by the

681

circuit court of the county where the registered office of the

682

corporation is located.

683

     (2) Whenever a vacancy occurs with respect to a director

684

elected by a class, chapter, unit, or group, the vacancy may be

685

filled only by members of that class, chapter, unit, or group,

686

or by a majority of the directors then in office elected by such

687

class, chapter, unit, or group.

688

     (3)(2) The term of a director elected or appointed to fill

689

a vacancy expires at the next annual meeting at which directors

690

are elected shall be elected or appointed for the unexpired term

691

of his or her predecessor in office. Any directorship to be

692

filled by reason of an increase in the number of directors may

693

be filled by the board of directors, but only for a term of

694

office continuing until the next election of directors by the

695

members or, if the corporation has no members or no members

696

having the right to vote thereon, for such term of office as is

697

provided in the articles of incorporation or the bylaws.

698

     (4)(3) A vacancy that will occur at a specific later date,

699

by reason of a resignation effective at a later date under s.

700

617.0807 or otherwise, may be filled before the vacancy occurs.

701

However, the new director may not take office until the vacancy

702

occurs.

703

     Section 22.  Subsection (2) of section 617.0832, Florida

704

Statutes, is amended, and subsection (3) is added to that

705

section, to read:

706

     617.0832  Director conflicts of interest.--

707

     (2) For purposes of paragraph (1)(a) only, a conflict-of-

708

interest transaction is authorized, approved, or ratified if it

709

receives the affirmative vote of a majority of the directors on

710

the board of directors, or on the committee, who have no

711

relationship or interest in the transaction described in

712

subsection (1), but a transaction may not be authorized,

713

approved, or ratified under this section by a single director.

714

If a majority of the directors who have no relationship or

715

interest in the transaction vote to authorize, approve, or

716

ratify the transaction, a quorum is present for the purpose of

717

taking action under this section. The presence of, or a vote

718

cast by, a director having a relationship or interest in the

719

transaction does not affect the validity of any action taken

720

under paragraph (1)(a) if the transaction is otherwise

721

authorized, approved, or ratified as provided in subsection (1),

722

but such presence or vote of such a director may be counted for

723

purposes of determining whether the transaction is approved

724

under other sections of this chapter.

725

     (3) For purposes of paragraph (1)(b), a conflict-of-

726

interest transaction is authorized, approved, or ratified if it

727

receives the vote of a majority in interest of the members

728

entitled to vote under this subsection. A director who has a

729

relationship or interest in the transaction described in

730

subsection (1) may not vote to determine whether to authorize,

731

approve, or ratify a conflict-of-interest transaction under

732

paragraph (1)(b). However, the vote of that director is counted

733

in determining whether the transaction is approved under other

734

sections of this chapter. A majority in interest of the members

735

entitled to vote on the transaction under this subsection

736

constitutes a quorum for the purpose of taking action under this

737

section. Common or interested directors may be counted in

738

determining the presence of a quorum at a meeting of the board

739

of directors or a committee thereof which authorizes, approves,

740

or ratifies such contract or transaction.

741

     Section 23.  Section 617.0833, Florida Statutes, is amended

742

to read:

743

     617.0833  Loans to directors or officers.--Loans, other

744

than through the purchase of bonds, debentures, or similar

745

obligations of the type customarily sold in public offerings, or

746

through ordinary deposit of funds in a bank, may not be made by

747

a corporation to its directors or officers, or to any other

748

corporation, firm, association, or other entity in which one or

749

more of its directors or officers is a director or officer or

750

holds a substantial financial interest, except a loan by one

751

corporation which is exempt from federal income taxation under

752

s. 501(c)(3) of the Internal Revenue Code or the corresponding

753

section of a subsequently enacted federal revenue act of 1986,

754

as amended, to another corporation which is exempt from federal

755

income taxation under s. 501(c)(3) of the Internal Revenue Code

756

or the corresponding section of a subsequently enacted federal

757

revenue act of 1986, as amended. A loan made in violation of

758

this section is a violation of the duty to the corporation of

759

the directors or officers authorizing it or participating in it,

760

but the obligation of the borrower with respect to the loan is

761

shall not be affected thereby.

762

     Section 24.  Subsection (1) of section 617.0834, Florida

763

Statutes, is amended to read:

764

     617.0834  Officers and directors of certain corporations

765

and associations not for profit; immunity from civil

766

liability.--

767

     (1)  An officer or director of a nonprofit organization

768

recognized under s. 501(c)(3) or s. 501(c)(4) or s. 501(c)(6) of

769

the Internal Revenue Code of 1986, as amended, or of the

770

corresponding section of a subsequently enacted federal revenue

771

act, or of an agricultural or a horticultural organization

772

recognized under s. 501(c)(5), of the Internal Revenue Code of

773

1986, as amended, or of the corresponding section of a

774

subsequently enacted federal revenue act, is not personally

775

liable for monetary damages to any person for any statement,

776

vote, decision, or failure to take an action, regarding

777

organizational management or policy by an officer or director,

778

unless:

779

     (a)  The officer or director breached or failed to perform

780

his or her duties as an officer or director; and

781

     (b)  The officer's or director's breach of, or failure to

782

perform, his or her duties constitutes:

783

     1.  A violation of the criminal law, unless the officer or

784

director had reasonable cause to believe his or her conduct was

785

lawful or had no reasonable cause to believe his or her conduct

786

was unlawful.  A judgment or other final adjudication against an

787

officer or director in any criminal proceeding for violation of

788

the criminal law estops that officer or director from contesting

789

the fact that his or her breach, or failure to perform,

790

constitutes a violation of the criminal law, but does not estop

791

the officer or director from establishing that he or she had

792

reasonable cause to believe that his or her conduct was lawful

793

or had no reasonable cause to believe that his or her conduct

794

was unlawful;

795

     2.  A transaction from which the officer or director

796

derived an improper personal benefit, either directly or

797

indirectly; or

798

     3. Recklessness or an act or omission that which was

799

committed in bad faith or with malicious purpose or in a manner

800

exhibiting wanton and willful disregard of human rights, safety,

801

or property.

802

     Section 25.  Subsections (2) and (3) of section 617.1007,

803

Florida Statutes, are amended to read:

804

     617.1007  Restated articles of incorporation.--

805

     (2)  The restatement may include one or more amendments to

806

the articles of incorporation. If the restatement includes an

807

amendment requiring member approval, it must be adopted as

808

provided in s. 617.1002.

809

     (3)  A corporation restating its articles of incorporation

810

shall deliver to the department of State for filing articles of

811

restatement, executed in accordance with the provisions of s.

812

617.01201, setting forth the name of the corporation and the

813

text of the restated articles of incorporation together with a

814

certificate setting forth:

815

     (a)  Whether the restatement contains an amendment to the

816

articles of incorporation requiring member approval and, if it

817

does not, that the board of directors adopted the restatement;

818

or

819

     (b)  If the restatement contains an amendment to the

820

articles of incorporation requiring member approval, the

821

information required by s. 617.1006.

822

     Section 26.  Subsection (2) of section 617.1101, Florida

823

Statutes, is amended, and subsection (3) is added to that

824

section, to read:

825

     617.1101  Plan of merger.--

826

     (2)  Each corporation must adopt a plan of merger setting

827

forth:

828

     (a)  The names of the corporations proposing to merge and

829

the name of the surviving corporation into which each other

830

corporation plans to merge, which is hereinafter designated as

831

the surviving corporation;

832

     (b)  The terms and conditions of the proposed merger;

833

     (c)  A statement of any changes in the articles of

834

incorporation of the surviving corporation to be effected by

835

such merger; and

836

     (d) The manner and basis, if any, of converting the

837

memberships of each merging corporation into memberships,

838

obligations, or securities of the surviving corporation or any

839

other corporation or, in whole or in part, into cash or other

840

property. Such other provisions with respect to the proposed

841

merger as are deemed necessary or desirable.

842

     (3) The plan of merger may set forth:

843

     (a) Amendments to, or a restatement of, the articles of

844

incorporation of the surviving corporation;

845

     (b) The effective date of the merger, which may be on or

846

after the date of filing the articles of incorporation or

847

merger; or

848

     (c) Other provisions relating to the merger.

849

     Section 27.  Section 617.1102, Florida Statutes, is created

850

to read:

851

     617.1102 Limitation on merger.--A corporation not for

852

profit organized under this chapter may merge with one or more

853

other business entities, as identified in s. 607.1108(1), only

854

if the surviving entity of such merger is a corporation not for

855

profit or other business entity that has been organized as a

856

not-for-profit entity under a governing statute or other

857

applicable law that allows such a merger.

858

     Section 28.  Section 617.1301, Florida Statutes, is created

859

to read:

860

     617.1301 Prohibited distributions.--Except as authorized

861

in ss. 617.0505 and 617.1302, a corporation may not make any

862

distributions to its members.

863

     Section 29.  Section 617.1302, Florida Statutes, is created

864

to read:

865

     617.1302 Authorized distributions.--

866

     (1) A mutual benefit corporation may purchase its

867

memberships pursuant to s. 617.0608 only if, after the purchase

868

is completed:

869

     (a) The mutual benefit corporation is able to pay its

870

debts as they become due in the usual course of its activities;

871

and

872

     (b) The total assets of the mutual benefit corporation at

873

least equal the sum of its total liabilities.

874

     (2) A corporation may make distributions upon dissolution

875

in conformity with the dissolution provisions of this chapter.

876

     Section 30.  Subsection (4) of section 617.1405, Florida

877

Statutes, is amended to read:

878

     617.1405  Effect of dissolution.--

879

     (4) The name of a dissolved corporation is shall not be

880

available for assumption or use by another corporation until

881

after 120 days after the effective date of dissolution unless

882

the dissolved corporation provides the department with an

883

affidavit, executed pursuant to s. 617.01201, authorizing the

884

immediate assumption or use of the name by another corporation.

885

     Section 31.  Section 617.1407, Florida Statutes, is created

886

to read:

887

     617.1407 Unknown claims against dissolved corporation.--

888

     (1) A dissolved corporation or successor entity may

889

execute one of the following procedures to resolve payment of

890

unknown claims:

891

     (a) A dissolved corporation or successor entity may file

892

notice of its dissolution with the department on the form

893

prescribed by the department and request that persons having

894

claims against the corporation which are not known to the

895

corporation or successor entity present them in accordance with

896

the notice. The notice must:

897

     1. State the name of the corporation and the date of

898

dissolution;

899

     2. Describe the information that must be included in a

900

claim and provide a mailing address to which the claim may be

901

sent; and

902

     3. State that a claim against the corporation under this

903

subsection is barred unless a proceeding to enforce the claim is

904

commenced within 4 years after the filing of the notice.

905

     (b) A dissolved corporation or successor entity may,

906

within 10 days after filing articles of dissolution with the

907

department, publish a "Notice of Corporate Dissolution." The

908

notice must appear once a week for 2 consecutive weeks in a

909

newspaper of general circulation in the county in the state in

910

which the corporation has its principal office, if any, or, if

911

none, in a county in the state in which the corporation owns

912

real or personal property. Such newspaper shall meet the

913

requirements as are prescribed by law for such purposes. The

914

notice must:

915

     1. State the name of the corporation and the date of

916

dissolution;

917

     2. Describe the information that must be included in a

918

claim and provide a mailing address to which the claim may be

919

sent; and

920

     3. State that a claim against the corporation under this

921

subsection is barred unless a proceeding to enforce the claim is

922

commenced within 4 years after the date of the second

923

consecutive weekly publication of the notice.

924

     (2) If the dissolved corporation or successor entity

925

complies with paragraph (1)(a) or paragraph (1)(b), the claim of

926

each of the following claimants is barred unless the claimant

927

commences a proceeding to enforce the claim against the

928

dissolved corporation within 4 years after the date of filing

929

the notice with the department or the date of the second

930

consecutive weekly publication, as applicable:

931

     (a) A claimant who did not receive written notice under s.

932

617.1408(9), or whose claim is not provided for under s.

933

617.1408(10), regardless of whether such claim is based on an

934

event occurring before or after the effective date of

935

dissolution.

936

     (b) A claimant whose claim was timely sent to the

937

dissolved corporation but on which no action was taken.

938

     (3) A claim may be entered under this section:

939

     (a) Against the dissolved corporation, to the extent of

940

its undistributed assets; or

941

     (b) If the assets have been distributed in liquidation,

942

against a member of the dissolved corporation to the extent of

943

such member's pro rata share of the claim or the corporate

944

assets distributed to such member in liquidation, whichever is

945

less; however, the aggregate liability of any member of a

946

dissolved corporation may not exceed the amount distributed to

947

the member in dissolution.

948

     Section 32.  Section 617.1408, Florida Statutes, is created

949

to read:

950

     617.1408 Known claims against dissolved corporation.--

951

     (1) A dissolved corporation or successor entity may

952

dispose of the known claims against it by following the

953

procedures described in subsections (2), (3), and (4).

954

     (2) The dissolved corporation or successor entity shall

955

deliver to each of its known claimants written notice of the

956

dissolution at any time after its effective date. The written

957

notice must:

958

     (a) Provide a reasonable description of the claim that the

959

claimant may be entitled to assert;

960

     (b) State whether the claim is admitted or not admitted,

961

in whole or in part, and, if admitted:

962

     1. The amount that is admitted, which may be as of a given

963

date; and

964

     2. Any interest obligation if fixed by an instrument of

965

indebtedness;

966

     (c) Provide a mailing address where a claim may be sent;

967

     (d) State the deadline, which must be at least 120 days

968

after the effective date of the written notice, by which

969

confirmation of the claim must be delivered to the dissolved

970

corporation or successor entity; and

971

     (e) State that the corporation or successor entity may

972

make distributions thereafter to other claimants and the members

973

of the corporation or persons interested as having been such

974

without further notice.

975

     (3) A dissolved corporation or successor entity may

976

reject, in whole or in part, any claim made by a claimant

977

pursuant to this section by mailing notice of such rejection to

978

the claimant within 90 days after receipt of such claim and, in

979

all events, at least 150 days before expiration of 3 years

980

following the effective date of dissolution. The notice must be

981

accompanied by a copy of this section.

982

     (4) A dissolved corporation or successor entity electing

983

to follow the procedures described in subsections (2) and (3)

984

must also give notice of dissolution to persons having known

985

claims that are contingent upon the occurrence or nonoccurrence

986

of future events, or are otherwise conditional or unmatured, and

987

request that such persons present such claims in accordance with

988

the terms of the notice. The notice must be in substantially the

989

form, and sent in the same manner, as described in subsection

990

(2).

991

     (5) A dissolved corporation or successor entity shall

992

offer any claimant whose known claim is contingent, conditional,

993

or unmatured such security as the corporation or entity

994

determines is sufficient to provide compensation to the claimant

995

if the claim matures. The dissolved corporation or successor

996

entity shall deliver such offer to the claimant within 90 days

997

after receipt of such claim and, in all events, at least 150

998

days before expiration of 3 years following the effective date

999

of dissolution. If the claimant offered such security does not

1000

deliver in writing to the dissolved corporation or successor

1001

entity a notice rejecting the offer within 120 days after

1002

receipt of such offer, the claimant is deemed to have accepted

1003

such security as the sole source from which to satisfy his or

1004

her claim against the corporation.

1005

     (6) A dissolved corporation or successor entity that has

1006

given notice in accordance with subsections (2) and (4) shall

1007

petition the circuit court in the county where the corporation's

1008

principal office is located or was located on the effective date

1009

of dissolution to determine the amount and form of security

1010

which is sufficient to provide compensation to a claimant who

1011

has rejected the offer for security made pursuant to subsection

1012

(5).

1013

     (7) A dissolved corporation or successor entity that has

1014

given notice in accordance with subsection (2) shall petition

1015

the circuit court in the county where the corporation's

1016

principal office is located or was located on the effective date

1017

of dissolution to determine the amount and form of security

1018

which is sufficient to provide compensation to claimants whose

1019

claims are known to the corporation or successor entity but

1020

whose identities are unknown. The court shall appoint a guardian

1021

ad litem to represent all claimants whose identities are unknown

1022

in any proceeding brought under this subsection. The reasonable

1023

fees and expenses of such guardian, including all reasonable

1024

expert witness fees, shall be paid by the petitioner in such

1025

proceeding.

1026

     (8) The giving of any notice or making of any offer

1027

pursuant to this section does not revive any claim then barred,

1028

does not constitute acknowledgment by the dissolved corporation

1029

or successor entity that any person to whom such notice is sent

1030

is a proper claimant, and does not operate as a waiver of any

1031

defense or counterclaim in respect of any claim asserted by any

1032

person to whom such notice is sent.

1033

     (9) A dissolved corporation or successor entity that has

1034

followed the procedures described in subsections (2)-(7) shall:

1035

     (a) Pay the claims admitted or made and not rejected in

1036

accordance with subsection (3);

1037

     (b) Post the security offered and not rejected pursuant to

1038

subsection (5);

1039

     (c) Post any security ordered by the circuit court in any

1040

proceeding under subsections (6) and (7); and

1041

     (d) Pay or make provision for all other known obligations

1042

of the corporation or the successor entity. Such claims or

1043

obligations shall be paid in full, and any provision for

1044

payments shall be made in full if there are sufficient funds. If

1045

there are insufficient funds, the claims and obligations shall

1046

be paid or provided for according to their priority and, among

1047

claims of equal priority, ratably to the extent of funds legally

1048

available for payment. Any remaining funds shall be distributed

1049

in accordance with s. 617.1406; however, such distribution may

1050

not be made until 150 days after the date of the last notice of

1051

rejections given pursuant to subsection (3). In the absence of

1052

actual fraud, the judgment of the directors of the dissolved

1053

corporation or the governing persons of the successor entity as

1054

to the provisions made for the payment of all obligations under

1055

this paragraph is conclusive.

1056

     (10) A dissolved corporation or successor entity that has

1057

not followed the procedures described in subsections (2) and (3)

1058

shall pay or make reasonable provision to pay all known claims

1059

and obligations, including all contingent, conditional, or

1060

unmatured claims known to the corporation or the successor

1061

entity and all claims that are known to the dissolved

1062

corporation or the successor entity but for which the identity

1063

of the claimant is unknown. Such claims shall be paid in full,

1064

and any provision for payment made shall be made in full if

1065

there are sufficient funds. If there are insufficient funds,

1066

such claims and obligations shall be paid or provided for

1067

according to their priority and, among claims of equal priority,

1068

ratably to the extent of funds legally available for payment

1069

thereof. Any remaining funds shall be distributed in accordance

1070

with s. 617.1406.

1071

     (11) Directors of a dissolved corporation or governing

1072

persons of a successor entity that has complied with subsection

1073

(9) or subsection (10) are not personally liable to the

1074

claimants of the dissolved corporation.

1075

     (12) A member of a dissolved corporation the assets of

1076

which were distributed pursuant to subsection (9) or subsection

1077

(10) is not liable for any claim against the corporation greater

1078

than the member's pro rata share of the claim or the amount

1079

distributed to the member, whichever is less.

1080

     (13) A member of a dissolved corporation, the assets of

1081

which were distributed pursuant to subsection (9), is not liable

1082

for any claim against the corporation which is known to the

1083

corporation or successor entity and on which a proceeding is

1084

begun after the expiration of 3 years following the effective

1085

date of dissolution.

1086

     (14) The aggregate liability of any member of a dissolved

1087

corporation for claims against the dissolved corporation may not

1088

be greater than the amount distributed to the member in

1089

dissolution.

1090

     Section 33. Subsection (6) of section 617.1421, Florida

1091

Statutes, is repealed.

1092

     Section 34.  Section 617.1422, Florida Statutes, is amended

1093

to read:

1094

     617.1422  Reinstatement following administrative

1095

dissolution.--

1096

     (1)(a) A corporation administratively dissolved under s.

1097

617.1421 may apply to the department of State for reinstatement

1098

at any time after the effective date of dissolution. The

1099

corporation must submit a reinstatement form prescribed and

1100

furnished by the department or a current uniform business report

1101

signed by a registered agent and an officer or director and

1102

submit application must:

1103

     1. Recite the name of the corporation and the effective

1104

date of its administrative dissolution;

1105

     2. State that the ground or grounds for dissolution either

1106

did not exist or have been eliminated and that no further

1107

grounds currently exist for dissolution;

1108

     3. State that the corporation's name satisfies the

1109

requirements of s. 617.0401; and

1110

     4. State that all fees owed by the corporation and

1111

computed at the rate provided by law at the time the corporation

1112

applies for reinstatement. have been paid; or

1113

     (b) Submit a current annual report, signed by the

1114

registered agent and an officer or director, which substantially

1115

complies with the requirements of paragraph (a).

1116

     (2) If the department of State determines that the

1117

application contains the information required by subsection (1)

1118

and that the information is correct, it shall file the document,

1119

cancel the certificate of dissolution, and reinstate the

1120

corporation effective on the date which the reinstatement

1121

document is filed.

1122

     (3)  When the reinstatement is effective, it relates back

1123

to and takes effect as of the effective date of the

1124

administrative dissolution and the corporation resumes carrying

1125

on its business affairs as if the administrative dissolution had

1126

never occurred.

1127

     (4) The name of the dissolved corporation is not available

1128

for assumption or use by another corporation until 1 year after

1129

the effective date of dissolution unless the dissolved

1130

corporation provides the department with an affidavit executed

1131

pursuant to s. 617.01201 authorizing the immediate assumption or

1132

use of the name by another corporation.

1133

     (5)(4) If the name of the dissolved corporation has been

1134

lawfully assumed in this state by another corporation, the

1135

department of State shall require the dissolved corporation to

1136

amend its articles of incorporation to change its name before

1137

accepting its application for reinstatement.

1138

     Section 35.  Subsection (2) of section 617.1430, Florida

1139

Statutes, is amended to read:

1140

     617.1430  Grounds for judicial dissolution.--A circuit

1141

court may dissolve a corporation:

1142

     (2) In a proceeding brought by at least 50 members or

1143

members holding at least 10 percent of the voting power,

1144

whichever is less, or by a member or group or percentage of

1145

members as otherwise provided in the articles of incorporation

1146

or bylaws, or by a director or any person authorized in the

1147

articles of incorporation, by a member if it is established

1148

that:

1149

     (a)  The directors are deadlocked in the management of the

1150

corporate affairs, the members are unable to break the deadlock,

1151

and irreparable injury to the corporation is threatened or being

1152

suffered;

1153

     (b)  The members are deadlocked in voting power and have

1154

failed to elect successors to directors whose terms have expired

1155

or would have expired upon qualification of their successors; or

1156

     (c)  The corporate assets are being misapplied or wasted.

1157

     Section 36.  Subsection (2) of section 617.1503, Florida

1158

Statutes, is amended to read:

1159

     617.1503  Application for certificate of authority.--

1160

     (2)  The foreign corporation shall deliver with the

1161

completed application a certificate of existence, (or a document

1162

of similar import,) duly authenticated, within not more than 90

1163

days prior to delivery of the application to the department of

1164

State, by the Secretary of State or other official having

1165

custody of corporate records in the jurisdiction under the law

1166

of which it is incorporated. A translation of the certificate,

1167

under oath of the translator, must be attached to a certificate

1168

that which is in a language other than the English language.

1169

     Section 37.  Subsection (2) of section 617.1504, Florida

1170

Statutes, is amended to read:

1171

     617.1504  Amended certificate of authority.--

1172

     (2) Such application shall be made within 90 30 days after

1173

the occurrence of any change mentioned in subsection (1), shall

1174

be made on forms prescribed by the department of State, shall be

1175

executed and filed in the same manner as an original application

1176

for authority, and shall set forth:

1177

     (a)  The name of the foreign corporation as it appears on

1178

the department's records of the Department of State;

1179

     (b)  The jurisdiction of its incorporation;

1180

     (c)  The date it was authorized to conduct its affairs in

1181

this state;

1182

     (d) If the name of the foreign corporation has been

1183

changed, the name relinquished, the new name, a statement that

1184

the change of name has been effected under the laws of the

1185

jurisdiction of its incorporation, and the date the change was

1186

effected;

1187

     (e) If the period of duration has been changed, a

1188

statement of such change and the date the change was effected;

1189

     (f) If the jurisdiction of incorporation has been changed,

1190

a statement of such change and the date the change was effected;

1191

and

1192

     (g) If the purpose or purposes that which the corporation

1193

intends to pursue in this state have been changed, a statement

1194

of such new purpose or purposes, and a further statement that

1195

the corporation is authorized to pursue such purpose or purposes

1196

in the jurisdiction of its incorporation.

1197

     Section 38.  Section 617.1506, Florida Statutes, is amended

1198

to read:

1199

     617.1506  Corporate name of foreign corporation.--

1200

     (1) A foreign corporation may is not entitled to file an

1201

application for a certificate of authority unless the corporate

1202

name of such corporation satisfies the requirements of s.

1203

617.0401. To obtain or maintain a certificate of authority to

1204

transact business in this state, the foreign corporation:

1205

     (a)  May add the word "corporation" or "incorporated" or

1206

the abbreviation "corp." or "inc." or words of like import,

1207

which as will clearly indicate that it is a corporation instead

1208

of a natural person or partnership or other business entity;

1209

however, to its corporate name for use in this state, provided,

1210

the name of a foreign corporation may not contain the word

1211

"company" or the abbreviation "co."; or

1212

     (b)  May use an alternate name to transact business in this

1213

state if its real name is unavailable. Any alternate corporate

1214

name adopted for use in this state must be cross-referenced to

1215

the real corporate name in the records of the Division of

1216

Corporations. If the real corporate name of the corporation

1217

becomes available in this state or if the corporation chooses to

1218

change its alternate name and it delivers to the Department of

1219

State, for filing, a copy of the resolution of its board of

1220

directors, changing or withdrawing the alternate name and

1221

executed as required by s. 617.01201, must be delivered for

1222

filing adopting an alternate name.

1223

     (2)  The corporate name, including the alternate name, of a

1224

foreign corporation must be distinguishable, within the records

1225

of the Division of Corporations, from:

1226

     (a) Any corporate name of a corporation for profit

1227

incorporated or authorized to transact business in this state.

1228

     (b)(a) The alternate name of another foreign corporation

1229

authorized to transact business in this state.

1230

     (c)(b) The corporate name of a not-for-profit corporation

1231

incorporated or authorized to transact business in this state.

1232

     (d)(c) The names of all other entities or filings, except

1233

fictitious name registrations pursuant to s. 865.09, organized,

1234

or registered under the laws of this state, that are on file

1235

with the Division of Corporations.

1236

     (3)  If a foreign corporation authorized to transact

1237

business in this state changes its corporate name to one that

1238

does not satisfy the requirements of s. 617.0401 607.0401, such

1239

corporation may not transact business in this state under the

1240

changed name until the corporation adopts a name satisfying the

1241

requirements of s. 617.0401 607.0401.

1242

     (4) The corporate name must be distinguishable from the

1243

names of all other entities or filings, organized, registered,

1244

or reserved under the laws of the state that are on file with

1245

the Division of Corporations, except fictitious name

1246

registrations pursuant to s. 865.09.

1247

     Section 39.  Subsection (6) of section 617.1530, Florida

1248

Statutes, is amended to read:

1249

     617.1530  Grounds for revocation of authority to conduct

1250

affairs.--The Department of State may commence a proceeding

1251

under s. 617.1531 to revoke the certificate of authority of a

1252

foreign corporation authorized to conduct its affairs in this

1253

state if:

1254

     (6) The department of State receives a duly authenticated

1255

certificate from the Secretary of State or other official having

1256

custody of corporate records in the jurisdiction under the law

1257

of which the foreign corporation is incorporated stating that it

1258

has been dissolved or disappeared as the result of a merger.

1259

     Section 40.  Paragraph (a) of subsection (5) of section

1260

617.1601, Florida Statutes, is amended to read:

1261

     617.1601  Corporate records.--

1262

     (5)  A corporation shall keep a copy of the following

1263

records:

1264

     (a) Its articles of incorporation or restated articles of

1265

incorporation and all amendments to them currently in effect.

1266

     Section 41.  Subsections (1), (2), and (4) of section

1267

617.1602, Florida Statutes, are amended to read:

1268

     617.1602  Inspection of records by members.--

1269

     (1)  A member of a corporation is entitled to inspect and

1270

copy, during regular business hours at the corporation's

1271

principal office or at a reasonable location specified by the

1272

corporation, any of the records of the corporation described in

1273

s. 617.1601(5), if the member gives the corporation written

1274

notice of his or her demand at least 10 5 business days before

1275

the date on which he or she wishes to inspect and copy.

1276

     (2)  A member of a corporation is entitled to inspect and

1277

copy, during regular business hours at a reasonable location

1278

specified by the corporation, any of the following records of

1279

the corporation if the member meets the requirements of

1280

subsection (3) and gives the corporation written notice of his

1281

or her demand at least 10 5 business days before the date on

1282

which he or she wishes to inspect and copy:

1283

     (a)  Excerpts from minutes of any meeting of the board of

1284

directors, records of any action of a committee of the board of

1285

directors while acting in place of the board of directors on

1286

behalf of the corporation, minutes of any meeting of the

1287

members, and records of action taken by the members or board of

1288

directors without a meeting, to the extent not subject to

1289

inspection under subsection (1).

1290

     (b)  Accounting records of the corporation.

1291

     (c)  The record of members.

1292

     (d)  Any other books and records.

1293

     (4)  This section does not affect:

1294

     (a) The right of a member to inspect and copy records

1295

under s. 617.0730(6), or, if the member is in litigation with

1296

the corporation to inspect and copy records, to the same extent

1297

as any other litigant.

1298

     (b) The power of a court, independently of this chapter

1299

act, to compel the production of corporate records for

1300

examination.

1301

     Section 42.  Section 617.1605, Florida Statutes, is amended

1302

to read:

1303

     617.1605 Financial reports for members.--A corporation,

1304

upon a member's written demand, shall furnish that member its

1305

latest annual financial statements, which may be consolidated or

1306

combined statements of the corporation and one or more of its

1307

subsidiaries or affiliates, as appropriate, and which include a

1308

balance sheet as of the end of the fiscal year and a statement

1309

of operations for that year. If financial statements are

1310

prepared for the corporation on the basis of generally accepted

1311

accounting principles, the annual financial statements must also

1312

be prepared on such basis. Within 60 days following the end of

1313

the fiscal or calendar year or annually on such date as is

1314

otherwise provided in the bylaws of the corporation, the board

1315

of directors of the corporation shall mail or furnish by

1316

personal delivery to each member a complete financial report of

1317

actual receipts and expenditures for the previous 12 months. The

1318

report shall show the amounts of receipts by accounts and

1319

receipt classifications and shall show the amounts of expenses

1320

by accounts and expense classifications.

1321

     Section 43.  Section 617.1703, Florida Statutes, is created

1322

to read:

1323

     617.1703 Application of chapter.--In the event of any

1324

conflict between the provisions of this chapter and chapter 718

1325

regarding condominiums, chapter 719 regarding cooperatives,

1326

chapter 720 regarding homeowners' associations, chapter 721

1327

regarding timeshares, or chapter 723 regarding mobile home

1328

owners' associations, the provisions of such other chapters

1329

shall apply. The provisions of ss. 617.0605-617.0608 do not

1330

apply to corporations regulated by any of the foregoing chapters

1331

or to any other corporation where membership in the corporation

1332

is required pursuant to a document recorded in the county

1333

property records.

1334

     Section 44.  Subsection (8) is added to section 617.1803,

1335

Florida Statutes, to read:

1336

     617.1803  Domestication of foreign not-for-profit

1337

corporations.--

1338

     (8) When a domestication becomes effective:

1339

     (a) The title to all real and personal property, both

1340

tangible and intangible, of the foreign corporation remains in

1341

the domesticated corporation without reversion or impairment;

1342

     (b) The liabilities of the foreign corporation remain the

1343

liabilities of the domesticated corporation;

1344

     (c) An action or proceeding against the foreign

1345

corporation continues against the domesticated corporation as if

1346

the domestication had not occurred;

1347

     (d) The articles of incorporation attached to the

1348

certificate of domestication constitute the articles of

1349

incorporation of the domesticated corporation; and

1350

     (e) Membership interests in the foreign corporation remain

1351

identical in the domesticated corporation.

1352

     Section 45.  Section 617.1806, Florida Statutes, is amended

1353

to read:

1354

     617.1806  Conversion to corporation not for profit;

1355

petition and contents.--A petition for conversion to a

1356

corporation not for profit pursuant to s. 617.1805 shall be

1357

accompanied by the written consent of all the shareholders

1358

authorizing the change in the corporate nature and directing an

1359

authorized officer to file such petition before the court,

1360

together with a statement agreeing to accept all the property of

1361

the petitioning corporation and agreeing to assume and pay all

1362

its indebtedness and liabilities, and the proposed articles of

1363

incorporation signed by the president and secretary of the

1364

petitioning corporation which shall set forth the provisions

1365

required in original articles of incorporation by s. 617.0202.

1366

     Section 46.  Section 617.1907, Florida Statutes, is amended

1367

to read:

1368

     617.1907 Effect of repeal or amendment of prior acts.--

1369

     (1) Except as provided in subsection (2), the repeal or

1370

amendment of a statute by this act does not affect:

1371

     (a)  The operation of the statute or any action taken under

1372

it before its repeal or amendment;

1373

     (b)  Any ratification, right, remedy, privilege,

1374

obligation, or liability acquired, accrued, or incurred under

1375

the statute before its repeal or amendment;

1376

     (c)  Any violation of the statute, or any penalty,

1377

forfeiture, or punishment incurred because of the violation,

1378

before its repeal or amendment; or

1379

     (d)  Any proceeding, reorganization, or dissolution

1380

commenced under the statute before its repeal or amendment, and

1381

the proceeding, reorganization, or dissolution may be completed

1382

in accordance with the statute as if it had not been repealed or

1383

amended.

1384

     (2)  If a penalty or punishment imposed for violation of a

1385

statute repealed or amended by this act is reduced by this act,

1386

the penalty or punishment if not already imposed shall be

1387

imposed in accordance with this act.

1388

     Section 47. Section 617.2103, Florida Statutes, is

1389

repealed.

1390

     Section 48.  This act shall take effect October 1, 2008.

1391

1392

================ T I T L E  A M E N D M E N T ================

1393

And the title is amended as follows:

1394

     Delete everything before the enacting clause

1395

and insert:

1396

A bill to be entitled

1397

An act relating to corporations not for profit; amending

1398

s. 617.01201, F.S.; requiring a document that is

1399

electronically transmitted to be in a format that may be

1400

retrieved in typewritten or printed form; requiring that a

1401

document be executed by a director of the domestic or

1402

foreign corporation; authorizing the delivery of a

1403

document by electronic transmission to the extent allowed

1404

by the Department of State; amending s. 617.0122, F.S.;

1405

requiring the department to collect a fee for filing an

1406

agent's statement of resignation from an inactive

1407

corporation; amending s. 617.0124, F.S.; authorizing a

1408

domestic or foreign corporation to correct a document

1409

filed by the department within 30 days under certain

1410

circumstances; amending s. 617.01401, F.S.; defining the

1411

terms "department," "distribution," "mutual benefit

1412

corporation," "successor entity," and "voting power";

1413

amending s. 617.0205, F.S.; requiring the incorporators to

1414

hold an organizational meeting after incorporation if the

1415

initial directors are not named in the articles of

1416

incorporation; amending s. 617.0302, F.S.; authorizing a

1417

corporation not for profit to make guaranties; amending s.

1418

617.0503, F.S.; providing that an alien business

1419

organization may withdraw its registered agent designation

1420

by delivering an application for certificate of withdrawal

1421

to the department; amending s. 617.0505, F.S.; prohibiting

1422

a corporation not for profit from making distributions to

1423

its members; providing an exception; deleting provisions

1424

related to the issuance of certificates; amending s.

1425

617.0601, F.S.; correcting a reference to the Solicitation

1426

of Contributions Act; providing that certain stock

1427

certificates constitute certificates of membership;

1428

requiring that a resignation, expulsion, or termination of

1429

membership be recorded in the membership book; creating s.

1430

617.0605, F.S.; prohibiting a member of a corporation from

1431

transferring a membership under certain circumstances;

1432

creating s. 617.0606, F.S.; providing that the resignation

1433

of a member does not relieve the member from obligations

1434

incurred and commitments made prior to resignation;

1435

creating s. 617.0607, F.S.; requiring that a member of a

1436

corporation be terminated or suspended pursuant to a

1437

procedure that is fair and reasonable; requiring that

1438

written notice given and delivered by certified mail or

1439

first-class mail; requiring that a proceeding challenging

1440

an expulsion, suspension, or termination be commenced

1441

within 1 year after the effective date of such expulsion,

1442

suspension, or termination; providing that a member who

1443

has been expelled or suspended may be liable to the

1444

corporation for dues, assessments, or fees; creating s.

1445

617.0608, F.S.; prohibiting a corporation from purchasing

1446

any of its memberships; authorizing a mutual benefit

1447

corporation to purchase the membership of a member who

1448

resigns or whose membership is terminated; amending s.

1449

617.0701, F.S.; authorizing the holders of at least 5

1450

percent of the voting power of a corporation to call a

1451

special meeting of the members under certain

1452

circumstances; authorizing a person who signs a demand for

1453

a special meeting to call a special meeting of the members

1454

under certain circumstances; revising the timeframes

1455

relating to written member consent to actions; clarifying

1456

the types of corporations that are not subject to certain

1457

requirements; amending s. 617.0721, F.S.; authorizing the

1458

corporation to reject a proxy action if it has reasonable

1459

doubt as the validity of an appointment; providing that

1460

members and proxy holders who are not physically present

1461

at a meeting may participate by means of remote

1462

communication and are deemed to be present at the meeting

1463

under certain circumstances; amending s. 617.0725, F.S.;

1464

requiring an amendment to the articles of incorporation or

1465

the bylaws which adds a greater or lesser quorum or voting

1466

requirement to meet certain requirements; creating s.

1467

617.07401, F.S.; prohibiting a person from commencing a

1468

proceeding in the right of a domestic or foreign

1469

corporation unless the person was a member of the

1470

corporation or became a member through transfer by

1471

operation of law; requiring that a complaint in a

1472

proceeding brought in the right of a domestic or foreign

1473

corporation be verified and allege the demand with

1474

particularity; authorizing the court to dismiss a

1475

derivative proceeding if the court finds that a

1476

determination was made in good faith after a reasonable

1477

investigation; prohibiting certain proceedings from being

1478

discontinued or settled without the approval of the court;

1479

authorizing the court to require a plaintiff to pay a

1480

defendant's reasonable expenses upon termination of a

1481

proceeding, including attorney's fees; amending s.

1482

617.0801, F.S.; providing the duties of the board of

1483

directors; amending s. 617.0806, F.S.; providing that

1484

directors may be divided into classes; amending s.

1485

617.0808, F.S.; providing that any member of the board of

1486

directors may be removed from office with or without cause

1487

by a certain vote; providing that a director who is

1488

elected by a class, chapter, or other organizational unit

1489

may be removed only by members of that class, chapter, or

1490

organizational unit; providing that a director elected or

1491

appointed by the board may be removed without cause by a

1492

vote of two-thirds of the directors then in office;

1493

providing that a director of a corporation described in s.

1494

501(c) of the Internal Revenue Code may be removed from

1495

office pursuant to procedures provided in the articles of

1496

incorporation or the bylaws; amending s. 617.0809, F.S.;

1497

providing that a vacancy on the board of directors for a

1498

director elected by a class, chapter, unit, or group may

1499

be filled only by members of that class, chapter, unit, or

1500

group; providing that the term of a director elected or

1501

appointed to fill a vacancy expires at the next annual

1502

meeting at which directors are elected; amending s.

1503

617.0832, F.S.; deleting a provision that authorizes

1504

common or interested directors to be counted in

1505

determining the presence of a quorum at a meeting that

1506

ratifies a contract between a corporation and one of its

1507

directors and any other corporation in which one of its

1508

directors is financially interested; providing

1509

circumstances under which a conflict-of-interest

1510

transaction is authorized; amending s. 617.0833, F.S.;

1511

providing an exception to the requirement that a loan may

1512

not be made by a corporation to its directors; amending s.

1513

617.0834, F.S.; providing that an officer or director of a

1514

certain nonprofit organization or agricultural or

1515

horticultural organization is immune from civil liability;

1516

amending s. 617.1007, F.S.; providing that a restatement

1517

of the articles of incorporation of a corporation may

1518

include one or more amendments; amending s. 617.1101,

1519

F.S.; providing requirements for a plan of merger;

1520

creating s. 617.1102, F.S.; providing a limitation on the

1521

merger of a corporation not for profit; creating s.

1522

617.1301, F.S.; prohibiting a corporation from making

1523

distributions to its members under certain circumstances;

1524

creating s. 617.1302, F.S.; providing that a mutual

1525

benefit corporation may purchase its memberships only

1526

under certain circumstances; authorizing a corporation to

1527

make distributions upon dissolution; amending s. 617.1405,

1528

F.S.; providing that the name of a dissolved corporation

1529

may be available for immediate assumption by another

1530

corporation if the dissolved corporation provides the

1531

department with an affidavit authorizing such use;

1532

creating s. 617.1407, F.S.; authorizing a dissolved

1533

corporation or successor entity to execute certain

1534

procedures to resolve payment of unknown claims against

1535

it; providing that certain claims against a dissolved

1536

corporation are barred; providing that a claim may be

1537

entered against a dissolved corporation under certain

1538

circumstances; creating s. 617.1408, F.S.; authorizing a

1539

dissolved corporation or successor entity to execute

1540

certain procedures to dispose of known claims against it;

1541

requiring that a dissolved corporation deliver written

1542

notice of the dissolution to each of its known claimants;

1543

providing a procedure under which a dissolved corporation

1544

may reject a claim made against it; requiring that a

1545

dissolved corporation give notice of the dissolution to

1546

persons having known claims that are contingent,

1547

conditional, or unmatured; requiring that a dissolved

1548

corporation follow certain procedures in offering

1549

compensation to a claimant if the claim matures; requiring

1550

that a dissolved corporation petition the circuit court to

1551

determine the amount and form of security that is

1552

sufficient to provide compensation to certain claimants;

1553

providing that the giving of notice or making of an offer

1554

does not revive a claim that has been barred; providing

1555

that directors of a dissolved corporation or governing

1556

persons of a successor entity that has complied with

1557

certain procedures are not personally liable to the

1558

claimants of a dissolved corporation; providing that

1559

certain members of a dissolved corporation are not liable

1560

for any claim against the corporation; providing a limit

1561

on the aggregate liability of any member of a dissolved

1562

corporation; repealing s. 617.1421(6), F.S., relating to

1563

the assumption and use of the name of a dissolved

1564

corporation; amending s. 617.1422, F.S.; deleting certain

1565

requirements for an application to reinstate a corporation

1566

that has been dissolved; requiring that a corporation

1567

submit a reinstatement form prescribed and furnished by

1568

the department; providing that the name of a dissolved

1569

corporation is not available for assumption or use by

1570

another corporation until 1 year after the effective date

1571

of dissolution; providing an exception; amending s.

1572

617.1430, F.S.; revising the requirements for members to

1573

dissolve a corporation in circuit court; amending s.

1574

617.1503, F.S.; requiring a foreign corporation to deliver

1575

a certificate of existence authenticated by the Secretary

1576

of State; amending s. 617.1504, F.S.; requiring that a

1577

foreign corporation make application to the department to

1578

obtain an amended certificate of authority within 90 days

1579

after the occurrence of a change; amending s. 617.1506,

1580

F.S.; requiring that an alternate corporate name adopted

1581

for use in this state be cross-referenced to the real

1582

corporate name in the records of the Division of

1583

Corporations; requiring that the corporate name of a

1584

foreign corporation be distinguishable from the corporate

1585

name of a corporation for profit incorporated or

1586

authorized to transact business in this state; amending s.

1587

617.1530, F.S.; requiring that the department receive an

1588

authenticated certificate from the Secretary of State

1589

before commencing a proceeding to revoke the certificate

1590

of authority of a foreign corporation; amending s.

1591

617.1601, F.S.; requiring that a corporation keep a copy

1592

of its articles of incorporation; amending s. 617.1602,

1593

F.S.; providing that a member of a corporation is entitled

1594

to inspect and copy certain records of the corporation at

1595

a reasonable location specified by the corporation;

1596

requiring that a member give the corporation written

1597

notice 10 days before the date on which he or she wishes

1598

to inspect and copy records; amending s. 617.1605, F.S.;

1599

revising the circumstances under which a corporation is

1600

required to furnish a member with its latest annual

1601

financial statement; creating s. 617.1703, F.S.; providing

1602

for the applicability of certain provisions to

1603

corporations regulated under the act; amending s.

1604

617.1803, F.S.; providing for certain changes when a

1605

foreign not-for-profit corporation becomes domesticated;

1606

amending s. 617.1806, F.S.; revising the provisions for

1607

conversion to a corporation not for profit; amending s.

1608

617.1907, F.S.; providing that the repeal or amendment of

1609

a statute does not affect certain operations and

1610

proceedings; repealing s. 617.2103, F.S., relating to

1611

exemptions for certain corporations; providing an

1612

effective date.

3/7/2008  3:05:00 PM     577-04464-08

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