Bill Text: MI HB5388 | 2023-2024 | 102nd Legislature | Introduced
Bill Title: Businesses: business corporations; business corporation act; general revisions concerning formation of benefit corporations. Amends secs. 105, 106, 131, 202, 211 & 911 of 1972 PA 284 (MCL 450.1105 et seq.). TIE BAR WITH: HB 5387'23
Spectrum: Strong Partisan Bill (Democrat 13-1)
Status: (Introduced) 2024-02-28 - Placed On Third Reading [HB5388 Detail]
Download: Michigan-2023-HB5388-Introduced.html
HOUSE BILL NO. 5388
A bill to amend 1972 PA 284, entitled
"Business corporation act,"
by amending sections 105, 106, 131, 202, 211, and 911 (MCL 450.1105, 450.1106, 450.1131, 450.1202, 450.1211, and 450.1911), sections 105, 106, 211, and 911 as amended by 2012 PA 569 and sections 131 and 202 as amended by 2018 PA 85.
the people of the state of michigan enact:
Sec. 105. (1) "Administrator" means the chief officer of the department or of any other agency or department authorized by law to administer this act, or his or her the designated representative of the chief officer.
(2) "Articles of incorporation" includes any of the following:
(a) The original articles of incorporation or any other instrument filed or issued under any statute to organize a domestic or foreign corporation, as amended, supplemented, or restated by certificates of amendment, merger, conversion, or consolidation or other certificates or instruments filed or issued under any statute.
(b) A special act or charter creating a domestic or foreign corporation, as amended, supplemented, or restated.
(3) "Authorized shares" means shares of all classes that a corporation is authorized to issue.
(4) "Benefit corporation" means a domestic corporation that meets the requirements for being a benefit corporation under chapter 9A and has not terminated its status as a benefit corporation under that chapter.
(5) (4) "Board" means board of directors or other governing board of a corporation.
(6) (5) "Bonds" includes secured and unsecured bonds, debentures, and notes.
Sec. 106. (1) "Corporation" or "domestic corporation" means a corporation formed under this act, or existing on January 1, 1973 and formed under any other statute of this state for a purpose for which a corporation may be formed under this act. Corporation or domestic corporation includes a benefit corporation.
(2) "Department" means the department of licensing and regulatory affairs.
(3) "Director" means a member of the board of a corporation.
(4) "Distribution" means a direct or indirect transfer of money or other property, except the corporation's shares, or the incurrence of indebtedness by the corporation to or for the benefit of its shareholders in respect to the corporation's shares. A distribution may be in the form of a dividend, a purchase, redemption or other acquisition of shares, an issuance of indebtedness, or any other declaration or payment to or for the benefit of the shareholders.
(5) "Electronic transmission" or "electronically transmitted" means any form of communication that meets all of the following:
(a) It does not directly involve the physical transmission of paper.
(b) It creates a record that may be retained and retrieved by the recipient.
(c) It may be directly reproduced in paper form by the recipient through an automated process.
Sec. 131. (1) A document that is required or permitted to be filed under this act shall must be submitted by delivering the document to the administrator together with the fees and accompanying documents required by law. The administrator may establish a procedure for accepting delivery of a document submitted under this subsection by facsimile or other electronic transmission. However, by December 31, 2006, the administrator shall establish a procedure for accepting delivery of a document submitted under this subsection by electronic mail email or over the internet. Beginning January 1, 2007, the administrator shall accept delivery of documents submitted by electronic mail email or over the internet.
(2) If a document submitted under subsection (1), other than an annual benefit report under section 961, substantially conforms to the requirements of this act, the administrator shall endorse upon on it the word "filed" with his or her the administrator's official title and the date of receipt and of filing and shall file and index the document or a photostatic, micrographic, photographic, optical disc media, or other reproduced copy in his or her the administrator's office. If requested at the time of the delivery of the document to his or her the administrator's office, the administrator shall include the hour of filing in the endorsement on the document.
(3) The administrator may return the original or a copy of a document filed under subsection (2) to the person that submitted it for filing. The administrator shall mark the filing date on the copy or original before returning it or may provide proof of the filing date to the person that submitted the document for filing in another manner determined by the administrator.
(4) The records and files of the administrator relating to domestic and foreign corporations shall must be open to reasonable inspection by the public. The administrator may maintain records or files in their original form or may maintain records or files in the form of reproductions pursuant to in accordance with the records reproduction act, 1992 PA 116, MCL 24.401 to 24.406, and may destroy the originals of the reproduced documents.
(5) The administrator may make reproductions of any documents filed under this act or any predecessor act pursuant to in accordance with the records reproduction act, 1992 PA 116, MCL 24.401 to 24.406, and may destroy the originals of the reproduced documents. A reproduced copy of a document certified by the administrator, including a copy sent by facsimile or other electronic transmission, is considered an original document for all purposes and is admissible in evidence in like manner as an original document.
(6) Except as provided in section 806, a document filed under subsection (2) is effective at the time it is endorsed unless a subsequent effective time, not later than 90 days after the date of delivery, is set forth stated in the document.
(7) The administrator shall charge 1 of the following nonrefundable fees if expedited filing of a document by the administrator is requested and the administrator shall retain the revenue collected under this subsection and the department shall use it to carry out its duties required by law:
(a) For any filing that a person requests the administrator to complete within 1 hour on the same day as the day of the request, $1,000.00. The department may establish a deadline by which a person must submit a request for filing under this subdivision.
(b) For any filing that a person requests the administrator to complete within 2 hours on the same day as the day of the request, $500.00. The department may establish a deadline by which a person must submit a request for filing under this subdivision.
(c) Except for a filing request under subdivision (a) or (b), for the filing of any formation or qualification document that a person requests the administrator to complete on the same day as the day of the request, $100.00. The department may establish a deadline by which a person must submit a request for filing under this subdivision.
(d) Except for a filing request under subdivision (a) or (b), for the filing of any other document concerning an existing domestic corporation or a qualified foreign corporation that a person requests the administrator to complete on the same day as the day of the request, $200.00. The department may establish a deadline by which a person must submit a request for filing under this subdivision.
(e) For the filing of any formation or qualification document that a person requests the administrator to complete within 24 hours of the time the administrator receives the request, $50.00.
(f) For the filing of any other document concerning an existing domestic corporation or a qualified foreign corporation that a person requests the administrator to complete within 24 hours of the time the administrator receives the request, $100.00.
Sec. 202. The articles of incorporation shall must contain all of the following:
(a) The name of the corporation.
(b) The purposes for which the corporation is formed. All of the following apply for purposes of this subdivision:
(i) Except as otherwise provided in subparagraph (ii), or (iii), or (iv), it is a sufficient compliance with this subdivision to state substantially, alone or with specifically enumerated purposes, that the corporation may engage in any activity within the purposes for which corporations may be formed under the business corporation act, and all activities shall must by the statement be considered within the purposes of the corporation, subject to expressed limitations.
(ii) Any corporation that proposes to conduct educational purposes shall state the purposes and shall comply with all requirements of sections 170 to 177 of 1931 PA 327, MCL 450.170 to 450.177.
(iii) A professional corporation shall comply with section 283(2) and (3).
(iv) The purpose of a benefit corporation must comply with section 953.
(c) The aggregate number of shares that the corporation has authority to issue.
(d) If the shares are, or are to be, divided into classes, or into classes and series, the designation of each class and series, the number of shares in each class and series, and a statement of the relative rights, preferences and limitations of the shares of each class and series, to the extent that the designations, numbers, relative rights, preferences, and limitations have been determined.
(e) If the shares are to be designated and issued in 1 or more classes or series, a statement of any authority vested in the board to designate and issue shares in 1 or more classes or series, and to determine or change for any class or series its designation, number of shares, relative rights, preferences and limitations.
(f) Except as otherwise provided in section 611(2)(c), the street address, and the mailing address if different from the street address, of the corporation's initial registered office and the name of the corporation's initial resident agent at that address.
(g) The names and addresses of the incorporators.
(h) The duration of the corporation if other than perpetual.
Sec. 211. (1) Except as provided in chapter 2A for a professional corporation and subsection (2) for a benefit corporation, the corporate name of a domestic corporation shall must contain the word "corporation", "company", "incorporated", or "limited" or shall must contain 1 of the following abbreviations: corp., co., inc., or ltd., with or without periods.
(2) The corporate name of a benefit corporation must contain the words "benefit corporation" or "benefit company" or must contain the initials "B.C.", with or without periods.
Sec. 911. (1) A domestic corporation and each foreign corporation subject to chapter 10 shall file a report with the administrator no not later than May 15 of each year. The report shall must be on a form approved by the administrator, signed by an authorized officer or agent of the corporation, and contain all of the following information:
(a) The name of the corporation.
(b) The name of its the corporation's resident agent and address of its the corporation's registered office in this state.
(c) The names and addresses of its the corporation's president, secretary, treasurer, and directors.
(d) General The general nature and kind of business in which the corporation is engaged.
(e) For each foreign corporation authorized to transact business in this state, the total number of authorized shares and the most recent percentage used in computation of the tax required by the Michigan business tax act, 2007 PA 36, MCL 208.1101 to 208.1601.208.1519.
(f) For each professional corporation, the names and addresses of its shareholders and a certification that both of the following are met:
(i) Each shareholder is a licensed person in 1 or more of the professional services provided by the professional corporation.
(ii) The corporation meets the other requirements of chapter 2A.
(2) A corporation that is a benefit corporation shall include the annual benefit report that is required under section 961 with the report under subsection (1).
(3) (2) A corporation that is formed or authorized to do business on or after January 1 and before May 16 of a calendar year is not required to file the report described in subsection (1) for that calendar year.
(4) (3) If there are no changes in the information provided in the last filed report required under subsection (1), the corporation may file a report that certifies to the administrator that no changes in the required information have occurred since the last filed report. A report filed under this subsection shall must be on a form approved by the administrator and filed no not later than the date required under this section. 911.A corporation that is a benefit corporation that files a report under this subsection shall include the annual benefit report that is required under section 961 with that report.
Enacting section 1. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No. 5387 (request no. 04622'23) of the 102nd Legislature is enacted into law.
