MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement,3 Edition 2003 by the American Bar Foundation These files are provided for educational and informational use only,and are not to be promulgated for any other purpose.Nothing contained herein is to be considered as the rendering of legal advice for specific cases,and readers are responsible for obtaining such advice from their own legal counsel.Any persons wishing to reprint these files in part or whole must obtain permission from the Manager,Copyrights and Licensing,American Bar Association,at 312-988-6102. (b)A certificate of existence or authorization sets forth: (1)the domestic corporation's corporate name or the foreign corporation's corporate name used in this state: (2)that (i)the domestic corporation is duly incorporated under the law of this state,the date of its incorporation,and the period of its duration if less than perpetual;or (ii)that the foreign corporation is authorized to transact business in this state; (3)that all fees,taxes,and penalties owed to this state have been paid,if (i)payment is reflected in the records of the secretary of state and (ii)nonpayment affects the existence or authorization of the domestic or foreign corporation; (4)that its most recent annual report required by section 16.21 has been delivered to the secretary of state: (5)that articles of dissolution have not been filed;and (6)other facts of record in the office of the secretary of state that may be requested by the applicant. (c)Subject to any qualification stated in the certificate,a certificate of existence or authorization issued by the secretary of state may be relied upon as conclusive evidence that the domestic or foreign corporation is in existence or is authorized to transact business in this state. CROSS-REFERENCES Certificate of existence for nonqualified foreign corporation,see 15.03 Filing fees,see§1.22 Filing requirements,see 1.20. Forms,,see§1.21 “Principal office”: defined,see§l.40, designated in annual report,see 16.21 Registered office: designated in annual report,see 16.21. requirement,see $2.02,5.01,15.07. 1.29.PENALTY FOR SIGNING FALSE DOCUMENT (a)A person commits an offense if he signs a document he knows is false in any material respect with intent that the document be delivered to the secretary of state for filing (b)An offense under this section is a[ misdemeanor [punishable by a fine of not to exceed 11
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement, 3rd Edition © 2003 by the American Bar Foundation These files are provided for educational and informational use only, and are not to be promulgated for any other purpose. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. Any persons wishing to reprint these files in part or whole must obtain permission from the Manager, Copyrights and Licensing, American Bar Association, at 312-988-6102. 11 (b) A certificate of existence or authorization sets forth: (1) the domestic corporation’s corporate name or the foreign corporation’s corporate name used in this state; (2) that (i) the domestic corporation is duly incorporated under the law of this state, the date of its incorporation, and the period of its duration if less than perpetual; or (ii) that the foreign corporation is authorized to transact business in this state; (3) that all fees, taxes, and penalties owed to this state have been paid, if (i) payment is reflected in the records of the secretary of state and (ii) nonpayment affects the existence or authorization of the domestic or foreign corporation; (4) that its most recent annual report required by section 16.21 has been delivered to the secretary of state; (5) that articles of dissolution have not been filed; and (6) other facts of record in the office of the secretary of state that may be requested by the applicant. (c) Subject to any qualification stated in the certificate, a certificate of existence or authorization issued by the secretary of state may be relied upon as conclusive evidence that the domestic or foreign corporation is in existence or is authorized to transact business in this state. CROSS-REFERENCES Certificate of existence for nonqualified foreign corporation, see § 15.03. Filing fees, see § 1.22. Filing requirements, see § 1.20. Forms, see § 1.21. “Principal office”: defined, see § 1.40. designated in annual report, see § 16.21. Registered office: designated in annual report, see § 16.21. requirement, see §§ 2.02, 5.01, 15.07. § 1.29. PENALTY FOR SIGNING FALSE DOCUMENT (a) A person commits an offense if he signs a document he knows is false in any material respect with intent that the document be delivered to the secretary of state for filing. (b) An offense under this section is a [ ______ ] misdemeanor [punishable by a fine of not to exceed $ ______ ]
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement,3 Edition 2003 by the American Bar Foundation These files are provided for educational and informational use only,and are not to be promulgated for any other purpose.Nothing contained herein is to be considered as the rendering of legal advice for specific cases,and readers are responsible for obtaining such advice from their own legal counsel.Any persons wishing to reprint these files in part or whole must obtain permission from the Manager,Copyrights and Licensing,American Bar Association,at 312-988-6102. CROSS-REFERENCES “Deliver,”seeS1.40 Judicial dissolution,see 14.30. Revocation of certificate of authority of foreign corporation,see 15.30 “Sign,”see§1.40. Subchapter C. SECRETARY OF STATE §1.30.POWERS The secretary of state has the power reasonably necessary to perform the duties required of him by this Act. CROSS-REFERENCES Administrative dissolution,see 14.20 Judicial dissolution,see 14.30. Revocation of certificate of authority of foreign corporation,see $15.30. Secretary of state's filing duty,see 1.25. Subchapter D. DEFINITIONS 1.40.ACT DEFINITIONS In this Act: (1)"Articles of incorporation"means the original articles of incorporation,all amendments thereof,and any other documents permitted or required to be filed by a domestic business corporation with the secretary of state under any provision of this Act except section 16.21.If an amendment of the articles or any other document filed under this Act restates the articles in their entirety,thenceforth the"articles"shall not include any prior documents. (2)"Authorized shares"means the shares of all classes a domestic or foreign corporation is authorized to issue. (3)"Conspicuous"means so written that a reasonable person against whom the writing is to operate should have noticed it.For example,printing in italics or boldface or contrasting color,or typing in capitals or underlined,is conspicuous. (4)“Corporation,”“domestic corporation”or“domestic business corporation”means a corporation for profit,which is not a foreign corporation,incorporated under or subject to the provisions of this Act. ()“Deliver'”or“delivery'”means any method of delivery used in conventional commercial practice,including delivery by hand,mail,commercial delivery,and electronic transmission. 12
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement, 3rd Edition © 2003 by the American Bar Foundation These files are provided for educational and informational use only, and are not to be promulgated for any other purpose. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. Any persons wishing to reprint these files in part or whole must obtain permission from the Manager, Copyrights and Licensing, American Bar Association, at 312-988-6102. 12 CROSS-REFERENCES “Deliver,” see § 1.40. Judicial dissolution, see § 14.30. Revocation of certificate of authority of foreign corporation, see § 15.30. “Sign,” see § 1.40. Subchapter C. SECRETARY OF STATE § 1.30. POWERS The secretary of state has the power reasonably necessary to perform the duties required of him by this Act. CROSS-REFERENCES Administrative dissolution, see § 14.20. Judicial dissolution, see § 14.30. Revocation of certificate of authority of foreign corporation, see § 15.30. Secretary of state’s filing duty, see § 1.25. Subchapter D. DEFINITIONS § 1.40. ACT DEFINITIONS In this Act: (1) “Articles of incorporation” means the original articles of incorporation, all amendments thereof, and any other documents permitted or required to be filed by a domestic business corporation with the secretary of state under any provision of this Act except section 16.21. If an amendment of the articles or any other document filed under this Act restates the articles in their entirety, thenceforth the “articles” shall not include any prior documents. (2) “Authorized shares” means the shares of all classes a domestic or foreign corporation is authorized to issue. (3) “Conspicuous” means so written that a reasonable person against whom the writing is to operate should have noticed it. For example, printing in italics or boldface or contrasting color, or typing in capitals or underlined, is conspicuous. (4) “Corporation,” “domestic corporation” or “domestic business corporation” means a corporation for profit, which is not a foreign corporation, incorporated under or subject to the provisions of this Act. (5) “Deliver” or “delivery” means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, and electronic transmission
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement,3 Edition 2003 by the American Bar Foundation These files are provided for educational and informational use only,and are not to be promulgated for any other purpose.Nothing contained herein is to be considered as the rendering of legal advice for specific cases,and readers are responsible for obtaining such advice from their own legal counsel.Any persons wishing to reprint these files in part or whole must obtain permission from the Manager,Copyrights and Licensing,American Bar Association,at 312-988-6102. (6)"Distribution"means a direct or indirect transfer of money or other property (except its own shares)or incurrence of indebtedness by a corporation to or for the benefit of its shareholders in respect of any of its shares.A distribution may be in the form of a declaration or payment of a dividend;a purchase,redemption,or other acquisition of shares;a distribution of indebtedness;or otherwise. (6A)"Domestic unincorporated entity"means an unincorporated entity whose internal affairs are governed by the laws of this state. (7)"Effective date of notice"is defined in section 1.41 (7A)"Electronic transmission"or "electronically transmitted"means any process of communication not directly involving the physical transfer of paper that is suitable for the retention, retrieval,and reproduction of information by the recipient. (7B)Eligible entity"means a domestic or foreign unincorporated entity or a domestic or foreign nonprofit corporation. (7C)"Eligible interests"means interests or memberships (8)"Employee"includes an officer but not a director.A director may accept duties that make him also an employee. (9)"Entity"includes domestic and foreign business corporation;domestic and foreign nonprofit corporation;estate;trust;domestic and foreign unincorporated entity;and state,United States,and foreign government. (9A)The phrase"facts objectively ascertainable"outside of a filed document or plan is defined in section 1.20(k). (9B)"Filing entity"means an unincorporated entity that is of a type that is created by filing a public organic document. (10)"Foreign corporation"means a corporation incorporated under a law other than the law of this state;which would be a business corporation if incorporated under the laws of this state (10A)"Foreign nonprofit corporation"means a corporation incorporated under a law other than the law of this state,which would be a nonprofit corporation if incorporated under the laws of this state. (10B)"Foreign unincorporated entity"means an unincorporated entity whose internal affairs are governed by an organic law of a jurisdiction other than this state (11)"Governmental subdivision"includes authority,county,district,and municipality (12)"Includes"denotes a partial definition. (13)"Individual"means a natural person. (13A)"Interest"means either or both of the following rights under the organic law of an unincorporated entity: (i)the right to receive distributions from the entity either in the ordinary course or upon liquidation;or (ii)the right to receive notice or vote on issues involving its internal affairs,other than as an agent,assignee,proxy or person responsible for managing its business and affairs. (13B)"Interest holder"means a person who holds of record an interest. (14)"Means"denotes an exhaustive definition. (14A)"Membership"means the rights of a member in a domestic or foreign nonprofit corporation. (14B)"Nonfiling entity"means an unincorporated entity that is of a type that is not created by filing a public organic document. 13
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement, 3rd Edition © 2003 by the American Bar Foundation These files are provided for educational and informational use only, and are not to be promulgated for any other purpose. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. Any persons wishing to reprint these files in part or whole must obtain permission from the Manager, Copyrights and Licensing, American Bar Association, at 312-988-6102. 13 (6) “Distribution” means a direct or indirect transfer of money or other property (except its own shares) or incurrence of indebtedness by a corporation to or for the benefit of its shareholders in respect of any of its shares. A distribution may be in the form of a declaration or payment of a dividend; a purchase, redemption, or other acquisition of shares; a distribution of indebtedness; or otherwise. (6A) “Domestic unincorporated entity” means an unincorporated entity whose internal affairs are governed by the laws of this state. (7) “Effective date of notice” is defined in section 1.41. (7A) “Electronic transmission” or “electronically transmitted” means any process of communication not directly involving the physical transfer of paper that is suitable for the retention, retrieval, and reproduction of information by the recipient. (7B) “Eligible entity” means a domestic or foreign unincorporated entity or a domestic or foreign nonprofit corporation. (7C) “Eligible interests” means interests or memberships. (8) “Employee” includes an officer but not a director. A director may accept duties that make him also an employee. (9) “Entity” includes domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; domestic and foreign unincorporated entity; and state, United States, and foreign government. (9A) The phrase “facts objectively ascertainable” outside of a filed document or plan is defined in section 1.20(k). (9B) “Filing entity” means an unincorporated entity that is of a type that is created by filing a public organic document. (10) “Foreign corporation” means a corporation incorporated under a law other than the law of this state; which would be a business corporation if incorporated under the laws of this state. (10A) “Foreign nonprofit corporation” means a corporation incorporated under a law other than the law of this state, which would be a nonprofit corporation if incorporated under the laws of this state. (10B) “Foreign unincorporated entity” means an unincorporated entity whose internal affairs are governed by an organic law of a jurisdiction other than this state. (11) “Governmental subdivision” includes authority, county, district, and municipality. (12) “Includes” denotes a partial definition. (13) “Individual” means a natural person. (13A) “Interest” means either or both of the following rights under the organic law of an unincorporated entity: (i) the right to receive distributions from the entity either in the ordinary course or upon liquidation; or (ii) the right to receive notice or vote on issues involving its internal affairs, other than as an agent, assignee, proxy or person responsible for managing its business and affairs. (13B) “Interest holder” means a person who holds of record an interest. (14) “Means” denotes an exhaustive definition. (14A) “Membership” means the rights of a member in a domestic or foreign nonprofit corporation. (14B) “Nonfiling entity” means an unincorporated entity that is of a type that is not created by filing a public organic document
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement,3 Edition 2003 by the American Bar Foundation These files are provided for educational and informational use only,and are not to be promulgated for any other purpose.Nothing contained herein is to be considered as the rendering of legal advice for specific cases,and readers are responsible for obtaining such advice from their own legal counsel.Any persons wishing to reprint these files in part or whole must obtain permission from the Manager,Copyrights and Licensing,American Bar Association,at 312-988-6102. (14C)"Nonprofit corporation"or"domestic nonprofit corporation"means a corporation incorporated under the laws of this state and subject to the provisions of the Model Nonprofit Corporation Act. (15)"Notice"is defined in section 1.41. (15A)"Organic document"means a public organic document or a private organic document. (15B)"Organic law"means the statute governing the internal affairs of a domestic or foreign business or nonprofit corporation or unincorporated entity. (15C)"Owner liability"means personal liability for a debt,obligation or liability of a domestic or foreign business or nonprofit corporation or unincorporated entity that is imposed on a person: (i)solely by reason of the person's status as a shareholder,member or interest holder; or (ii)by the articles of incorporation,bylaws or an organic document under a provision of the organic law of an entity authorizing the articles of incorporation,bylaws or an organic document to make one or more specified shareholders,members or interest holders liable in their capacity as shareholders,members or interest holders for all or specified debts,obligations or liabilities of the entity. (16)"Person"includes an individual and an entity (17)"Principal office"means the office(in or out of this state)so designated in the annual report where the principal executive offices of a domestic or foreign corporation are located. (17A)"Private organic document"means any document(other than the public organic document,if any)that determines the internal governance of an unincorporated entity.Where a private organic document has been amended or restated,the term means the private organic document as last amended or restated. (17B)"Public organic document"means the document,if any,that is filed of public record to create an unincorporated entity.Where a public organic document has been amended or restated,the term means the public organic document as last amended or restated. (18)"Proceeding"includes civil suit and criminal,administrative,and investigatory action. (19)"Record date"means the date established under chapter 6 or 7 on which a corporation determines the identity of its shareholders and their shareholdings for purposes of this Act.The determinations shall be made as of the close of business on the record date unless another time for doing so is specified when the record date is fixed. (20)"Secretary"means the corporate officer to whom the board of directors has delegated responsibility under section 8.40(c)for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation. (21)"Shareholder"means the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation. (22)"Shares"means the units into which the proprietary interests in a corporation are divided. (22A)"Sign"or "signature"includes any manual,facsimile,conformed or electronic signature. (23)"State,"when referring to a part of the United States,includes a state and commonwealth (and their agencies and governmental subdivisions)and a territory and insular possession(and their agencies and governmental subdivisions)of the United States. (24)"Subscriber"means a person who subscribes for shares in a corporation,whether before or after incorporation. 14
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement, 3rd Edition © 2003 by the American Bar Foundation These files are provided for educational and informational use only, and are not to be promulgated for any other purpose. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. Any persons wishing to reprint these files in part or whole must obtain permission from the Manager, Copyrights and Licensing, American Bar Association, at 312-988-6102. 14 (14C) “Nonprofit corporation” or “domestic nonprofit corporation” means a corporation incorporated under the laws of this state and subject to the provisions of the Model Nonprofit Corporation Act. (15) “Notice” is defined in section 1.41. (15A) “Organic document” means a public organic document or a private organic document. (15B) “Organic law “ means the statute governing the internal affairs of a domestic or foreign business or nonprofit corporation or unincorporated entity. (15C) “Owner liability” means personal liability for a debt, obligation or liability of a domestic or foreign business or nonprofit corporation or unincorporated entity that is imposed on a person: (i) solely by reason of the person’s status as a shareholder, member or interest holder; or (ii) by the articles of incorporation, bylaws or an organic document under a provision of the organic law of an entity authorizing the articles of incorporation, bylaws or an organic document to make one or more specified shareholders, members or interest holders liable in their capacity as shareholders, members or interest holders for all or specified debts, obligations or liabilities of the entity. (16) “Person” includes an individual and an entity. (17) “Principal office” means the office (in or out of this state) so designated in the annual report where the principal executive offices of a domestic or foreign corporation are located. (17A) “Private organic document” means any document (other than the public organic document, if any) that determines the internal governance of an unincorporated entity. Where a private organic document has been amended or restated, the term means the private organic document as last amended or restated. (17B) “Public organic document” means the document, if any, that is filed of public record to create an unincorporated entity. Where a public organic document has been amended or restated, the term means the public organic document as last amended or restated. (18) “Proceeding” includes civil suit and criminal, administrative, and investigatory action. (19) “Record date” means the date established under chapter 6 or 7 on which a corporation determines the identity of its shareholders and their shareholdings for purposes of this Act. The determinations shall be made as of the close of business on the record date unless another time for doing so is specified when the record date is fixed. (20) “Secretary” means the corporate officer to whom the board of directors has delegated responsibility under section 8.40(c) for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation. (21) “Shareholder” means the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation. (22) “Shares” means the units into which the proprietary interests in a corporation are divided. (22A) “Sign” or “signature” includes any manual, facsimile, conformed or electronic signature. (23) “State,” when referring to a part of the United States, includes a state and commonwealth (and their agencies and governmental subdivisions) and a territory and insular possession (and their agencies and governmental subdivisions) of the United States. (24) “Subscriber” means a person who subscribes for shares in a corporation, whether before or after incorporation
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement,3 Edition 2003 by the American Bar Foundation These files are provided for educational and informational use only,and are not to be promulgated for any other purpose.Nothing contained herein is to be considered as the rendering of legal advice for specific cases,and readers are responsible for obtaining such advice from their own legal counsel.Any persons wishing to reprint these files in part or whole must obtain permission from the Manager,Copyrights and Licensing,American Bar Association,at 312-988-6102. (24A)"Unincorporated entity"means an organization or artificial legal person that either has a separate legal existence or has the power to acquire an estate in real property in its own name and that is not any of the following:a domestic or foreign business or nonprofit corporation,an estate,a trust,a state,the United States,or a foreign government.The term includes a general partnership,limited liability company,limited partnership,business trust,joint stock association and incorporated nonprofit association (25)"United States"includes district,authority,bureau,commission,department,and any other agency of the United States. (26)"Voting group"means all shares of one or more classes or series that under the articles of incorporation or this Act are entitled to vote and be counted together collectively on a matter at a meeting of shareholders.All shares entitled by the articles of incorporation or this Act to vote generally on the matter are for that purpose a single voting group. (27)"Voting power"means the current power to vote in the election of directors. CROSS-REFERENCES Annual report,see 16.21 Nominee certificate,see 7.23 Special definitions: “affiliate,”see§13.01. beneficial shareholder,”see§l3.0l "conflicting interest or director's conflicting interest,"see 8.60. “corporation,.”see§§8.50&13.0l “derivative proceeding,”see§7.40 “disinterested director,.”see§8.50. "expenses,"see 8.50. “fair value,”see§l3.0l “interest,”see§l3.0l. “interests,”see§ll.0l liability,”see§8.50. “merger,,”see§ll.0l “officer,”see§8.50. “official capacity,.”see§8.50. “organizational documents,.”see§ll.0l. “other entity,”see§1l.0l. “outstanding shares,”see§6.03 “party,”see§8.50. party to a merger,”or“party to a share exchange”see Section 11.0l. preferred shares,.”see§l3.0l. proceeding,”see§8.50. "professional corporation,"see Model Professional Corporation Supplement. record shareholder,.”see§l3.0l “related person,”see§8.60. “required disclosure,”see§s8.60 “senior executive,”see§l3.0l. “share exchange,”see§ll.01 “shares,”see§§6.27&6.30. 15
MODEL BUSINESS CORPORATION ACT 2000/01/02 Supplement, 3rd Edition © 2003 by the American Bar Foundation These files are provided for educational and informational use only, and are not to be promulgated for any other purpose. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. Any persons wishing to reprint these files in part or whole must obtain permission from the Manager, Copyrights and Licensing, American Bar Association, at 312-988-6102. 15 (24A) “Unincorporated entity” means an organization or artificial legal person that either has a separate legal existence or has the power to acquire an estate in real property in its own name and that is not any of the following: a domestic or foreign business or nonprofit corporation, an estate, a trust, a state, the United States, or a foreign government. The term includes a general partnership, limited liability company, limited partnership, business trust, joint stock association and incorporated nonprofit association. (25) “United States” includes district, authority, bureau, commission, department, and any other agency of the United States. (26) “Voting group” means all shares of one or more classes or series that under the articles of incorporation or this Act are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. All shares entitled by the articles of incorporation or this Act to vote generally on the matter are for that purpose a single voting group. (27) “Voting power” means the current power to vote in the election of directors. CROSS-REFERENCES Annual report, see § 16.21. Nominee certificate, see § 7.23. Special definitions: “affiliate,” see § 13.01. “beneficial shareholder,” see § 13.01. “conflicting interest or director’s conflicting interest,” see § 8.60. “corporation,” see §§ 8.50 & 13.01. “derivative proceeding,” see § 7.40. “disinterested director,” see § 8.50. “expenses,” see § 8.50. “fair value,” see § 13.01. “interest,” see § 13.01. “interests,” see § 11.01. “liability,” see § 8.50. “merger,” see § 11.01. “officer,” see § 8.50. “official capacity,” see § 8.50. “organizational documents,” see § 11.01. “other entity,” see § 11.01. “outstanding shares,” see § 6.03. “party,” see § 8.50. “party to a merger,” or “party to a share exchange” see Section 11.01. “preferred shares,” see § 13.01. “proceeding,” see § 8.50. “professional corporation,” see Model Professional Corporation Supplement. “record shareholder,” see § 13.01. “related person,” see § 8.60. “required disclosure,” see § 8.60. “senior executive,” see § 13.01. “share exchange,” see § 11.01. “shares,” see §§ 6.27 & 6.30