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90_SB0952sam003
LRB9002543DJpcam
1 AMENDMENT TO SENATE BILL 952
2 AMENDMENT NO. . Amend Senate Bill 952 by replacing
3 the title with the following:
4 "AN ACT concerning business."; and
5 by replacing everything after the enacting clause with the
6 following:
7 "Section 5. The Business Corporation Act of 1983 is
8 amended by changing Sections 1.80, 14.30, and 15.90 and
9 adding Sections 9.20 and 13.75 as follows:
10 (805 ILCS 5/1.80) (from Ch. 32, par. 1.80)
11 Sec. 1.80. Definitions. As used in this Act, unless the
12 context otherwise requires, the words and phrases defined in
13 this Section shall have the meanings set forth herein.
14 (a) "Corporation" or "domestic corporation" means a
15 corporation subject to the provisions of this Act, except a
16 foreign corporation.
17 (b) "Foreign corporation" means a corporation for profit
18 organized under laws other than the laws of this State, but
19 shall not include a foreign banking corporation organized
20 under the laws of a country other than the United States and
21 holding a certificate of authority from the Commissioner of
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1 Banks and Real Estate issued pursuant to the Foreign Banking
2 Office Act.
3 (c) "Articles of incorporation" means the original
4 articles of incorporation, including the articles of
5 incorporation of a new corporation set forth in the articles
6 of consolidation, and all amendments thereto, whether
7 evidenced by articles of amendment, articles of merger,
8 articles of exchange, statement of correction affecting
9 articles, resolution establishing series of shares or a
10 statement of cancellation under Section 9.05. Restated
11 articles of incorporation shall supersede the original
12 articles of incorporation and all amendments thereto prior to
13 the effective date of filing the articles of amendment
14 incorporating the restated articles of incorporation.
15 (d) "Subscriber" means one who subscribes for shares in
16 a corporation, whether before or after incorporation.
17 (e) "Incorporator" means one of the signers of the
18 original articles of incorporation.
19 (f) "Shares" means the units into which the proprietary
20 interests in a corporation are divided.
21 (g) "Shareholder" means one who is a holder of record of
22 shares in a corporation.
23 (h) "Certificate" representing shares means a written
24 instrument executed by the proper corporate officers, as
25 required by Section 6.35 of this Act, evidencing the fact
26 that the person therein named is the holder of record of the
27 share or shares therein described. If the corporation is
28 authorized to issue uncertificated shares in accordance with
29 Section 6.35 of this Act, any reference in this Act to shares
30 represented by a certificate shall also refer to
31 uncertificated shares and any reference to a certificate
32 representing shares shall also refer to the written notice in
33 lieu of a certificate provided for in Section 6.35.
34 (i) "Authorized shares" means the aggregate number of
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1 shares of all classes which the corporation is authorized to
2 issue.
3 (j) "Paid-in capital" means the sum of the cash and
4 other consideration received, less expenses, including
5 commissions, paid or incurred by the corporation, in
6 connection with the issuance of shares, plus any cash and
7 other consideration contributed to the corporation by or on
8 behalf of its shareholders, plus amounts added or transferred
9 to paid-in capital by action of the board of directors or
10 shareholders pursuant to a share dividend, share split, or
11 otherwise, minus reductions as provided elsewhere in this Act
12 from that sum effected by an acquisition and cancellation of
13 its own shares, to the extent of the cost of the reacquired
14 and cancelled shares or a lesser amount as may be elected by
15 the corporation. Irrespective of the manner of designation
16 thereof by the laws under which a foreign corporation is or
17 may be organized, paid-in capital of a foreign corporation
18 shall be determined on the same basis and in the same manner
19 as paid-in capital of a domestic corporation, for the purpose
20 of computing license fees, franchise taxes and other charges
21 imposed by this Act.
22 (k) "Net assets", for the purpose of determining the
23 right of a corporation to purchase its own shares and of
24 determining the right of a corporation to declare and pay
25 dividends and make other distributions to shareholders is
26 equal to the difference between the assets of the corporation
27 and the liabilities of the corporation.
28 (l) "Registered office" means that office maintained by
29 the corporation in this State, the address of which is on
30 file in the office of the Secretary of State, at which any
31 process, notice or demand required or permitted by law may be
32 served upon the registered agent of the corporation.
33 (m) "Insolvent" means that a corporation is unable to
34 pay its debts as they become due in the usual course of its
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1 business.
2 (n) "Anniversary" means that day each year exactly one
3 or more years after:
4 (1) the date on the certificate of incorporation
5 issued under Section 2.10 of this Act, in the case of a
6 domestic corporation;
7 (2) the date on the certificate of authority issued
8 under Section 13.15 of this Act, in the case of a foreign
9 corporation; or
10 (3) the date on the certificate of consolidation
11 issued under Section 11.25 of this Act in the case of a
12 consolidation, unless the plan of consolidation provides
13 for a delayed effective date, pursuant to Section 11.40.
14 (o) "Anniversary month" means the month in which the
15 anniversary of the corporation occurs.
16 (p) "Extended filing month" means the month (if any)
17 which shall have been established in lieu of the
18 corporation's anniversary month in accordance with Section
19 14.01.
20 (q) "Taxable year" means that 12 month period commencing
21 with the first day of the anniversary month of a corporation
22 through the last day of the month immediately preceding the
23 next occurrence of the anniversary month of the corporation,
24 except that in the case of a corporation that has established
25 an extended filing month "taxable year" means that 12 month
26 period commencing with the first day of the extended filing
27 month through the last day of the month immediately preceding
28 the next occurrence of the extended filing month.
29 (r) "Fiscal year" means the 12 month period with respect
30 to which a corporation ordinarily files its federal income
31 tax return.
32 (s) "Close corporation" means a corporation organized
33 under or electing to be subject to Article 2A of this Act,
34 the articles of incorporation of which contain the provisions
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1 required by Section 2.10, and either the corporation's
2 articles of incorporation or an agreement entered into by all
3 of its shareholders provide that all of the issued shares of
4 each class shall be subject to one or more of the
5 restrictions on transfer set forth in Section 6.55 of this
6 Act.
7 (t) "Common shares" means shares which have no
8 preference over any other shares with respect to distribution
9 of assets on liquidation or with respect to payment of
10 dividends.
11 (u) "Delivered", for the purpose of determining if any
12 notice required by this Act is effective, means:
13 (1) transferred or presented to someone in person;
14 or
15 (2) deposited in the United States Mail addressed
16 to the person at his, her or its address as it appears on
17 the records of the corporation, with sufficient
18 first-class postage prepaid thereon.
19 (v) "Property" means gross assets including, without
20 limitation, all real, personal, tangible, and intangible
21 property.
22 (w) "Taxable period" means that 12-month period
23 commencing with the first day of the second month preceding
24 the corporation's anniversary month in the preceding year and
25 prior to the first day of the second month immediately
26 preceding its anniversary month in the current year, except
27 that, in the case of a corporation that has established an
28 extended filing month, "taxable period" means that 12-month
29 period ending with the last day of its fiscal year
30 immediately preceding the extended filing month. In the case
31 of a newly formed domestic corporation or a newly registered
32 foreign corporation that had not commenced transacting
33 business in this State prior to obtaining a certificate of
34 authority, "taxable period" means that period commencing with
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1 the issuance of a certificate of incorporation or, in the
2 case of a foreign corporation, of a certificate of authority,
3 and prior to the first day of the second month immediately
4 preceding its anniversary month in the next succeeding year.
5 (x) "Treasury shares" mean (1) shares of a corporation
6 that have been issued, have been subsequently acquired by and
7 belong to the corporation, and have not been cancelled or
8 restored to the status of authorized but unissued shares and
9 (2) shares (i) declared and paid as a share dividend on the
10 shares referred to in clause (1) or this clause (2), or (ii)
11 issued in a share split of the shares referred to in clause
12 (1) or this clause (2). Treasury shares shall be deemed to
13 be "issued" shares but not "outstanding" shares. Treasury
14 shares may not be voted, directly or indirectly, at any
15 meeting or otherwise. Shares converted into or exchanged for
16 other shares of the corporation shall not be deemed to be
17 treasury shares.
18 (Source: P.A. 88-151; 89-508, eff. 7-3-96.)
19 (805 ILCS 5/9.20 new)
20 Sec. 9.20. Reduction of paid-in capital.
21 (a) A corporation may reduce its paid-in capital:
22 (1) by resolution of its board of directors by
23 charging against its paid-in capital (i) the paid-in
24 capital represented by shares acquired and cancelled by
25 the corporation as permitted by law, to the extent of the
26 cost from the paid-in capital of the reacquired and
27 cancelled shares or a lesser amount as may be elected by
28 the corporation, (ii) dividends paid on preferred shares,
29 or (iii) distributions as liquidating dividends; or
30 (2) pursuant to an approved reorganization in
31 bankruptcy that specifically directs the reduction to be
32 effected.
33 (b) Notwithstanding anything to the contrary contained
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1 in this Act, at no time shall the paid-in capital be reduced
2 to an amount less than the aggregate par value of all issued
3 shares having a par value.
4 (c) Until the report under Section 14.30 has been filed
5 in the Office of the Secretary of State showing a reduction
6 in paid-in capital, the basis of the annual franchise tax
7 payable by the corporation shall not be reduced; provided,
8 however, that in no event shall the annual franchise tax for
9 any taxable year be reduced if the report is not filed prior
10 to the first day of the anniversary month or, in the case of
11 a corporation that has established an extended filing month,
12 the extended filing month of the corporation of that taxable
13 year and before payment of its annual franchise tax.
14 (d) A corporation that reduced its paid-in capital after
15 December 31, 1986 by one or more of the methods described in
16 subsection (a) may report the reduction pursuant to Section
17 14.30, subject to the restrictions of subsections (b) and
18 (c) of this Section. A reduction in paid-in capital reported
19 pursuant to this subsection shall have no effect for any
20 purpose under this Act with respect to a taxable year ending
21 before the report is filed.
22 (e) Nothing in this Section shall be construed to forbid
23 any reduction in paid-in capital to be effected under Section
24 9.05 of this Act.
25 (805 ILCS 5/13.75 new)
26 Sec. 13.75. Activities that do not constitute
27 transacting business. Without excluding other activities
28 that may not constitute doing business in this State, a
29 foreign corporation shall not be considered to be transacting
30 business in this State, for purposes of this Article 13, by
31 reason of carrying on in this State any one or more of the
32 following activities:
33 (1) maintaining, defending, or settling any
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1 proceeding;
2 (2) holding meetings of the board of directors or
3 shareholders or carrying on other activities concerning
4 internal corporate affairs;
5 (3) maintaining bank accounts;
6 (4) maintaining offices or agencies for the
7 transfer, exchange, and registration of the corporation's
8 own securities or maintaining trustees or depositaries
9 with respect to those securities;
10 (5) selling through independent contractors;
11 (6) soliciting or obtaining orders, whether by mail
12 or through employees or agents or otherwise, if orders
13 require acceptance outside this State before they become
14 contracts;
15 (7) creating or acquiring indebtedness, mortgages,
16 and security interests in real or personal property;
17 (8) securing or collecting debts or enforcing
18 mortgages and security interests in property securing the
19 debts;
20 (9) owning, without more, real or personal
21 property;
22 (10) conducting an isolated transaction that is
23 completed within 120 days and that is not one in the
24 course of repeated transactions of a like nature; or
25 (11) having a corporate officer or director who is
26 a resident of this State.
27 (805 ILCS 5/14.30) (from Ch. 32, par. 14.30)
28 Sec. 14.30. Cumulative report of changes in issued
29 shares or paid-in capital.
30 (a) Each domestic corporation and each foreign
31 corporation authorized to transact business in this State
32 that effects any change in the number of issued shares or the
33 amount of paid-in capital that has not theretofore been
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1 reported in any report other than an annual report, interim
2 annual report, or final transition annual report, shall
3 execute and file, in accordance with Section 1.10 of this
4 Act, a report with respect to the changes in its issued
5 shares or paid-in capital:
6 (1) that have occurred subsequent to the last day
7 of the third month preceding its anniversary month in the
8 preceding year and prior to the first day of the second
9 month immediately preceding its anniversary month in the
10 current year; or
11 (2) in the case of a corporation that has
12 established an extended filing month, that have occurred
13 during its fiscal year; or
14 (3) in the case of a statutory merger or
15 consolidation or an amendment to the corporation's
16 articles of incorporation that affects the number of
17 issued shares or the amount of paid-in capital, that have
18 occurred between the last day of the third month
19 immediately preceding its anniversary month and the date
20 of the merger, or consolidation, or amendment or, in the
21 case of a corporation that has established an extended
22 filing month, that have occurred between the first day of
23 its fiscal year and the date of the merger, or
24 consolidation, or amendment; or
25 (4) in the case of a statutory merger or
26 consolidation or an amendment to the corporation's
27 articles of incorporation that affects the number of
28 issued shares or the amount of paid-in capital, that have
29 occurred between the date of the merger, consolidation,
30 or amendment (but not including the merger, or
31 consolidation, or amendment) and the first day of the
32 second month immediately preceding its anniversary month
33 in the current year, or in the case of a corporation that
34 has established an extended filing month, that have
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1 occurred between the date of the merger, consolidation or
2 amendment (but not including the merger, consolidation or
3 amendment) and the last day of its fiscal year.
4 (b) The corporation shall file the report required under
5 subsection (a) not later than (i) the time its annual report
6 is required to be filed in 1992 and in each subsequent year
7 and (ii) not later than the time of filing the articles of
8 merger, consolidation, or amendment to the articles of
9 incorporation that affects the number of issued shares or the
10 amount of paid-in capital of a domestic corporation or the
11 certified copy of merger of a foreign corporation.
12 (c) The report shall net decreases against increases
13 that occur during the same taxable period. The report shall
14 set forth:
15 (1) The name of the corporation and the state or
16 country under the laws of which it is organized.
17 (2) A statement of the aggregate number of shares
18 which the corporation has authority to issue, itemized by
19 classes and series, if any, within a class.
20 (3) A statement of the aggregate number of issued
21 shares as last reported to the Secretary of State in any
22 document required or permitted by this Act to be filed,
23 other than an annual report, interim annual report or
24 final transition annual report, itemized by classes and
25 series, if any, within a class.
26 (4) A statement, expressed in dollars, of the
27 amount of paid-in capital of the corporation as last
28 reported to the Secretary of State in any document
29 required or permitted by this Act to be filed, other than
30 an annual report, interim annual report or final
31 transition annual report.
32 (5) A statement, if applicable, of the aggregate
33 number of shares issued by the corporation not
34 theretofore reported to the Secretary of State as having
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1 been issued, and a statement, expressed in dollars, of
2 the value of the entire consideration received, less
3 expenses, including commissions, paid or incurred in
4 connection with the issuance, for, or on account of, the
5 issuance of the shares, itemized by classes, and series,
6 if any, within a class; and in the case of shares issued
7 as a share dividend, the amount added or transferred to
8 the paid-in capital of the corporation for, or on account
9 of, the issuance of the shares; provided, however, that
10 the report shall also include the date of each issuance
11 made prior to the current reporting period, and the
12 number of issued shares and consideration received in
13 each case.
14 (6) A statement, if applicable, expressed in
15 dollars, of the amount added or transferred to paid-in
16 capital of the corporation without the issuance of
17 shares; provided, however, that the report shall also
18 include the date of each increase made prior to the
19 current reporting period, and the consideration received
20 in each case.
21 (7) In case of an exchange or reclassification of
22 issued shares resulting in an increase in the amount of
23 paid-in capital, a statement of the manner in which it
24 was effected, and a statement, expressed in dollars, of
25 the amount added or transferred to the paid-in capital of
26 the corporation as a result thereof, except any portion
27 thereof reported under any other subsection of this
28 Section as a part of the consideration received by the
29 corporation for, or on account of, its issued shares;
30 provided, however, that the report shall also include the
31 date of each exchange or reclassification made prior to
32 the current reporting period and the consideration
33 received in each case.
34 (8) If the consideration received for the issuance
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1 of any shares not theretofore reported as having been
2 issued consists of labor or services performed or of
3 property, other than cash, then a statement, expressed in
4 dollars, of the value of that consideration as fixed by
5 the board of directors.
6 (9) In the case of a cancellation of shares or a
7 reduction in paid-in capital made pursuant to Section
8 9.20 in connection with the cancellation of shares, the
9 aggregate reduction in paid-in capital resulting from the
10 acquisition of the shares; provided, however, that the
11 report shall also include the date of each reduction made
12 prior to the current reporting period.
13 (10) A statement of the aggregate number of issued
14 shares itemized by classes and series, if any, within a
15 class, after giving effect to the changes reported.
16 (11) A statement, expressed in dollars, of the
17 amount of paid-in capital of the corporation after giving
18 effect to the changes reported.
19 (d) No additional license fees or franchise taxes shall
20 be payable upon the filing of the report to the extent that
21 license fees or franchise taxes shall have been previously
22 paid by the corporation in respect of shares previously
23 issued which are being exchanged for the shares the issuance
24 of which is being reported, provided those facts are shown in
25 the report.
26 (e) The report shall be made on forms prescribed and
27 furnished by the Secretary of State.
28 (f) Until the report under this Section or a report
29 under Section 14.25 shall have been filed in the Office of
30 the Secretary of State showing a reduction in paid-in
31 capital, the basis of the annual franchise tax payable by the
32 corporation shall not be reduced, provided, however, in no
33 event shall the annual franchise tax for any taxable year be
34 reduced if the report is not filed prior to the first day of
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1 the anniversary month or, in the case of a corporation which
2 has established an extended filing month, the extended filing
3 month of the corporation of that taxable year and before
4 payment of its annual franchise tax.
5 (Source: P.A. 86-985; 86-1217; 87-516.)
6 (805 ILCS 5/15.90) (from Ch. 32, par. 15.90)
7 Sec. 15.90. Statute of limitations.
8 (a) Except as otherwise provided in this Section and
9 notwithstanding anything to the contrary contained in any
10 other Section of this Act, no domestic corporation or foreign
11 corporation shall be obligated to pay any annual franchise
12 tax, fee, or penalty or interest thereon imposed under this
13 Act, nor shall any administrative or judicial sanction
14 (including dissolution) be imposed or enforced nor access to
15 the courts of this State be denied based upon nonpayment
16 thereof more than 7 years after the date of filing the annual
17 report with respect to the period during which the obligation
18 for the tax, fee, penalty or interest arose, unless (1)
19 within that 7 year period the Secretary of State sends a
20 written notice to the corporation to the effect that (A)
21 administrative or judicial action to dissolve the corporation
22 or revoke its certificate of authority for nonpayment of a
23 tax, fee, penalty or interest has been commenced; or (B) the
24 corporation has submitted filed a report but has failed to
25 pay a tax, fee, penalty or interest required to be paid
26 therewith; or (C) a report with respect to an event or action
27 giving rise to an obligation to pay a tax, fee, penalty or
28 interest is required but has not been filed, or has been
29 filed and is in error or incomplete; or (2) the annual report
30 by the corporation was filed with fraudulent intent to evade
31 taxes payable under this Act. A corporation nonetheless
32 shall be required to pay all the annual franchise taxes that
33 would have been payable during the most recent 7 year period
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1 due to a previously unreported increase in paid-in capital
2 that occurred prior to that 7 year period and interest and
3 penalties thereon for that period.
4 (b) If within 2 years following a change in control of a
5 corporation the corporation voluntarily pays in good faith
6 all known obligations of the corporation imposed by this
7 Article 15 with respect to reports that were required to have
8 been filed since the beginning of the 7 year period ending on
9 the effective date of the change in control, no action shall
10 be taken to enforce or collect obligations of that
11 corporation imposed by this Article 15 with respect to
12 reports that were required to have been filed prior to that 7
13 year period regardless of whether the limitation period set
14 forth in subsection (a) is otherwise applicable. For
15 purposes of this subsection (b), a change in control means a
16 transaction, or a series of transactions consummated within a
17 period of 180 consecutive days, as a result of which a person
18 which owned less than 10% of the shares having the power to
19 elect directors of the corporation acquires shares such that
20 the person becomes the holder of 80% or more of the shares
21 having such power. For purposes of this subsection (b) a
22 person means any natural person, corporation, partnership,
23 trust or other entity together with all other persons
24 controlled by, controlling or under common control with such
25 person.
26 (c) Except as otherwise provided in this Section and
27 notwithstanding anything to the contrary contained in any
28 other Section of this Act, no foreign corporation that has
29 not previously obtained a certificate of authority under this
30 Act shall, upon voluntary application for a certificate of
31 authority filed with the Secretary of State prior to January
32 1, 2001, be obligated to pay any tax, fee, penalty, or
33 interest imposed under this Act, nor shall any administrative
34 or judicial sanction be imposed or enforced based upon
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1 nonpayment thereof with respect to a period during which the
2 obligation arose that is prior to January 1, 1993 unless (1)
3 prior to receipt of the application for a certificate of
4 authority the Secretary of State had sent written notice to
5 the corporation regarding its failure to obtain a certificate
6 of authority, (2) the corporation had submitted an
7 application for a certificate of authority previously but had
8 failed to pay any tax, fee, penalty or interest to be paid
9 therewith, or (3) the application for a certificate of
10 authority was submitted by the corporation with fraudulent
11 intent to evade taxes payable under this Act. A corporation
12 nonetheless shall be required to pay all taxes and fees due
13 under this Act that would have been payable since January 1,
14 1993 as a result of commencing the transaction of its
15 business in this State and interest thereon for that period.
16 (Source: P.A. 86-985; 86-1217.)
17 Section 10. The Assumed Business Name Act is amended by
18 changing Section 4 as follows:
19 (805 ILCS 405/4) (from Ch. 96, par. 7)
20 Sec. 4. This Act shall in no way affect or apply to any
21 corporation, limited liability company, limited partnership,
22 or limited liability partnership duly organized under the
23 laws of this State, or any corporation, limited liability
24 company, limited partnership, or limited liability
25 partnership organized under the laws of any other State and
26 lawfully doing business in this State, nor shall this Act be
27 deemed or construed to prevent the lawful use of a
28 partnership name or designation, provided that such
29 partnership shall include the true, real name of such person
30 or persons transacting said business or partnership nor shall
31 it be construed as in any way affecting Sections 220 and 220a
32 of Division I of "An Act to revise the law in relation to
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1 criminal jurisprudence", approved March 27, 1874, as amended.
2 This Act shall in no way affect or apply to testamentary or
3 other express trusts where the business is carried on in the
4 name of the trust and such trust is created by will or other
5 instrument in writing under which title to the trust property
6 is vested in a designated trustee or trustees for the use and
7 benefit of the cestuis que trustent.
8 (Source: Laws 1941, vol. 1, p. 550.)
9 Section 99. Effective date. This Act takes effect
10 January 1, 1998.".