(805 ILCS 5/12.20) (from Ch. 32, par. 12.20)
Sec. 12.20. Articles of dissolution.
(a) When a voluntary dissolution has been authorized as provided by this Act, articles of dissolution shall be executed and filed in duplicate in accordance with Section 1.10 of this Act and shall set forth:
(1) The name of the corporation.
(2) The date dissolution was authorized.
(3) A post‑office address to which may be mailed a |
| copy of any process against the corporation that may be served on the Secretary of State. | |
(4) A statement of the aggregate number of issued |
| shares of the corporation itemized by classes and series, if any, within a class, as of the date of execution. | |
(5) A statement of the amount of paid‑in capital of |
| the corporation as of the date of execution. | |
(6) Such additional information as may be necessary |
| or appropriate in order to determine any unpaid fees or franchise taxes payable by such corporation as in this Act prescribed. | |
(7) Where dissolution is authorized pursuant to |
| Section 12.05, a statement that a majority of incorporators or majority of directors, as the case may be, have consented to the dissolution and that all provisions of Section 12.05 have been complied with. | |
(8) Where dissolution is authorized pursuant to |
| Section 12.10, a statement that the holders of all the outstanding shares entitled to vote on dissolution have consented thereto. | |
(9) Where dissolution is authorized pursuant to |
| Section 12.15, a statement that a resolution proposing dissolution has been adopted at a meeting of shareholders by the affirmative vote of the holders of outstanding shares having not less than the minimum number of votes necessary to adopt such resolution as provided by the articles of incorporation. | |
(b) When the provisions of this Section have been complied with, the Secretary of State shall file the articles of dissolution.
(c) The dissolution is effective on the date of the filing of the articles thereof by the Secretary of State.
(Source: P.A. 92‑33, eff. 7‑1‑01.) |
(805 ILCS 5/12.45)
(from Ch. 32, par. 12.45)
Sec. 12.45.
Reinstatement following administrative dissolution.
(a) A domestic corporation administratively dissolved under Section 12.40 may be reinstated by the Secretary of State following the date of issuance of the certificate of dissolution upon:
(1) The filing of an application for reinstatement.
(2) The filing with the Secretary of State by the
| corporation of all reports then due and theretofore becoming due. | |
(3) The payment to the Secretary of State by the |
| corporation of all fees, franchise taxes, and penalties then due and theretofore becoming due. | |
(b) The application for reinstatement shall be executed and filed in duplicate in accordance with Section 1.10 of this Act and shall set forth:
(1) The name of the corporation at the time of the |
| issuance of the certificate of dissolution. | |
(2) If such name is not available for use as |
| determined by the Secretary of State at the time of filing the application for reinstatement, the name of the corporation as changed, provided however, and any change of name is properly effected pursuant to Section 10.05 and Section 10.30 of this Act. | |
(3) The date of the issuance of the certificate of |
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(4) The address, including street and number, or |
| rural route number of the registered office of the corporation upon reinstatement thereof, and the name of its registered agent at such address upon the reinstatement of the corporation, provided however, that any change from either the registered office or the registered agent at the time of dissolution is properly reported pursuant to Section 5.10 of this Act. | |
(c) When a dissolved corporation has complied with the provisions of this Section the Secretary of State shall file the application for reinstatement.
(d) Upon the filing of the application for reinstatement, the corporate existence shall be deemed to have continued without interruption from the date of the issuance of the certificate of dissolution, and the corporation shall stand revived with such powers, duties and obligations as if it had not been dissolved; and all acts and proceedings of its officers, directors and shareholders, acting or purporting to act as such, which would have been legal and valid but for such dissolution, shall stand ratified and confirmed.
(Source: P.A. 96‑328, eff. 8‑11‑09.) |
(805 ILCS 5/12.50)
(from Ch. 32, par. 12.50)
Sec. 12.50.
Grounds for judicial dissolution in actions by nonshareholders.
(a) A Circuit Court may dissolve a corporation:
(1) In an action by the Attorney General, if it is
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(i) The corporation filed its articles of |
| incorporation through fraud; or | |
(ii) The corporation has continued to exceed or |
| abuse the authority conferred upon it by law, or has continued to violate the law, after notice of the same has been given to such corporation, either personally or by registered mail; or | |
(iii) Any interrogatory propounded by the |
| Secretary of State to the corporation, its officers or directors, as provided in this Act, has been answered falsely or has not been answered fully within 30 days after the mailing of such interrogatories by the Secretary of State or within such extension of time as shall have been authorized by the Secretary of State. | |
(2) In an action by a creditor, if it is established |
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(i) The creditor's claim has been reduced to |
| judgment, a copy of the judgment has been returned unsatisfied, and the corporation is insolvent; or | |
(ii) The corporation has admitted in writing |
| that the creditor's claim is due and owing, and the corporation is insolvent. | |
(3) In an action by the corporation to dissolve |
| under court supervision, if it is established that dissolution is reasonably necessary because the business of the corporation can no longer be conducted to the general advantage of its shareholders. | |
(b) As an alternative to dissolution, the court may order any of the other remedies contained in subsection (b) of Section 12.55.
(Source: P.A. 96‑66, eff. 1‑1‑10.) |
(805 ILCS 5/12.55) (from Ch. 32, par. 12.55)
Sec. 12.55. Shareholder remedies: public corporations.
(a) In an action by a shareholder of a corporation that has shares listed on a national securities exchange or regularly traded in a market maintained by one or more members of a national or affiliated securities association, the Circuit Court may order one or more of the remedies listed in subsection (b) if it is established that:
(1) The directors are deadlocked, whether because of |
| even division in the number of directors or because of greater than majority voting requirements in the articles of incorporation or the by‑laws, in the management of the corporate affairs; the shareholders are unable to break the deadlock; and either irreparable injury to the corporation is thereby caused or threatened or the business of the corporation can no longer be conducted to the general advantage of the shareholders; or | |
(2) The directors or those in control of the |
| corporation have acted, are acting, or will act in a manner that is illegal, oppressive or fraudulent with respect to the petitioning shareholder; or | |
(3) The corporate assets are being misapplied or |
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(b) In an action under subsection (a), the court may order the following relief:
(1) The appointment of a custodian to manage the |
| business and affairs of the corporation to serve for the term and under the conditions prescribed by the court; | |
(2) The appointment of a provisional director to |
| serve for the term and under the conditions prescribed by the court; or | |
(3) The dissolution of the corporation.
(c) The court, at any time during the pendency of the action and upon the motion of the complaining shareholder, may order the corporation to purchase the shares of the petitioning shareholder at a fair price determined by the court, with or without the assistance of appraisers, and payable in cash or in installments and with or without such security other than personal commitments of other shareholders as the court may direct.
(d) Either the corporation or any shareholder or group of shareholders may, any time after the filing of an action for dissolution pursuant to subdivision (b)(3), petition the court to purchase the shares of a complaining shareholder and, unless the court finds such procedure to be inequitable, the court shall determine the fair value of the shares as of such date as the court finds equitable. In so doing, the court shall follow the procedures set forth for appraisal of shares under Section 11.70 and shall thereafter dismiss the action.
(e) Nothing in this Section limits the equitable powers of the court to order other relief.
(Source: P.A. 89‑169; eff. 7‑19‑95; 89‑364, eff. 8‑18‑95; 89‑626, eff. 8‑9‑96.) |
(805 ILCS 5/12.56)
Sec. 12.56.
Shareholder remedies: non‑public corporations.
(a) In an action by a shareholder in a corporation that has no shares listed on a national securities exchange or regularly traded in a market maintained by one or more members of a national or affiliated securities association, the Circuit Court may order one or more of the remedies listed in subsection (b) if it is established that:
(1) The directors are deadlocked, whether because of
| even division in the number of directors or because of greater than majority voting requirements in the articles of incorporation or the by‑laws or otherwise, in the management of the corporate affairs; the shareholders are unable to break the deadlock; and either irreparable injury to the corporation is thereby caused or threatened or the business of the corporation can no longer be conducted to the general advantage of the shareholders; or | |
(2) The shareholders are deadlocked in voting power |
| and have failed, for a period that includes at least 2 consecutive annual meeting dates, to elect successors to directors whose terms have expired and either irreparable injury to the corporation is thereby caused or threatened or the business of the corporation can no longer be conducted to the general advantage of the shareholders; or | |
(3) The directors or those in control of the |
| corporation have acted, are acting, or will act in a manner that is illegal, oppressive, or fraudulent with respect to the petitioning shareholder whether in his or her capacity as a shareholder, director, or officer; or | |
(4) The corporation assets are being misapplied or |
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(b) The relief which the court may order in an action under subsection (a) includes but is not limited to the following:
(1) The performance, prohibition, alteration, or |
| setting aside of any action of the corporation or of its shareholders, directors, or officers of or any other party to the proceedings; | |
(2) The cancellation or alteration of any provision |
| in the corporation's articles of incorporation or by‑laws; | |
(3) The removal from office of any director or |
|
(4) The appointment of any individual as a director |
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(5) An accounting with respect to any matter in |
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(6) The appointment of a custodian to manage the |
| business and affairs of the corporation to serve for the term and under the conditions prescribed by the court; | |
(7) The appointment of a provisional director to |
| serve for the term and under the conditions prescribed by the court; | |
(8) The submission of the dispute to mediation or |
| other forms of non‑binding alternative dispute resolution; | |
(9) The payment of dividends;
(10) The award of damages to any aggrieved party;
(11) The purchase by the corporation or one or more |
| other shareholders of all, but not less than all, of the shares of the petitioning shareholder for their fair value and on the terms determined under subsection (e); or | |
(12) The dissolution of the corporation if the court |
| determines that no remedy specified in subdivisions (1) through (11) or other alternative remedy is sufficient to resolve the matters in dispute. In determining whether to dissolve the corporation, the court shall consider among other relevant evidence the financial condition of the corporation but may not refuse to dissolve the corporation solely because it has accumulated earnings or current operating profits. | |
(c) The remedies set forth in subsection (b) shall not be exclusive of other legal and equitable remedies which the court may impose.
(d) In determining the appropriate relief to order pursuant to this Section, the court may take into consideration the reasonable expectations of the corporation's shareholders as they existed at the time the corporation was formed and developed during the course of the shareholders' relationship with the corporation and with each other.
(e) If the court orders a share purchase, it shall:
(i) Determine the fair value of the shares, with |
| or without the assistance of appraisers, taking into account any impact on the value of the shares resulting from the actions giving rise to a petition under this Section; | |
(ii) Consider any financial or legal constraints |
| on the ability of the corporation or the purchasing shareholder to purchase the shares; | |
(iii) Specify the terms of the purchase, |
| including, if appropriate, terms for installment payments, interest at the rate and from the date determined by the court to be equitable, subordination of the purchase obligation to the rights of the corporation's other creditors, security for a deferred purchase price, and a covenant not to compete or other restriction on the seller; | |
(iv) Require the seller to deliver all of his or |
| her shares to the purchaser upon receipt of the purchase price or the first installment of the purchase price; and | |
(v) Retain jurisdiction to enforce the purchase |
| order by, among other remedies, ordering the corporation to be dissolved if the purchase is not completed in accordance with the terms of the purchase order. | |
For purposes of this subsection (e), "fair value", with respect to a petitioning shareholder's shares, means the proportionate interest of the shareholder in the corporation, without any discount for minority status or, absent extraordinary circumstances, lack of marketability.
The purchase ordered pursuant to this subsection (e) shall be consummated within 20 days after the date the order becomes final unless before that time the corporation files with the court a notice of its intention to dissolve and articles of dissolution are properly filed with the Secretary of State within 50 days after filing the notice with the court.
After the purchase order is entered and before the purchase price is fully paid, any party may petition the court to modify the terms of the purchase and the court may do so if it finds that such changes are equitable.
Unless the purchase order is modified by the court, the selling shareholder shall have no further rights as a shareholder from the date the seller delivers all of his or her shares to the purchaser or such other date specified by the court.
If the court orders shares to be purchased by one or more other shareholders, in allocating the shares to be purchased by the other shareholders, unless equity requires otherwise, the court shall attempt to preserve the existing distribution of voting rights and other designations, preferences, qualifications, limitations, restrictions and special or relative rights among the holders of the class or classes and may direct that holders of a specific class or classes shall not participate in the purchase.
(f) When the relief requested by the petition includes the purchase of the petitioner's shares, then at any time within 90 days after the filing of the petition under this Section, or at such time determined by the court to be equitable, the corporation or one or more shareholders may elect to purchase all, but not less than all, of the shares owned by the petitioning shareholder for their fair value. An election pursuant to this Section shall state in writing the amount which the electing party will pay for the shares.
(1) The election shall be irrevocable unless the |
| court determines that it is equitable to set aside or modify the election. | |
(2) If the election to purchase is filed by one or |
| more shareholders, the corporation shall, within 10 days thereafter, give written notice to all shareholders. The notice must state: (i) the name and number of shares owned by the petitioner; (ii) the name and number of shares owned by each electing shareholder; and (iii) the amount which each electing party will pay for the shares and must advise the recipients of their right to join in the election to purchase shares. Shareholders who wish to participate must file notice of their intention to join in a purchase no later than 30 days after the date of the notice to them or at such time as the court in its discretion may allow. All shareholders who have filed an election or notice of their intention to participate in the election to purchase thereby become parties to the proceeding and shall participate in the purchase in proportion to their ownership of shares as of the date the first election was filed, unless they otherwise agree or the court otherwise directs. | |
(3) The court in its discretion may allow the |
| corporation and all non‑petitioning shareholders to file an election to purchase the petitioning shareholder's shares at a higher price. If the court does so, it shall allow other shareholders an opportunity to join in the purchase at the higher price in accordance with their proportionate ownership interest. | |
(4) After an election has been filed by the |
| corporation or one or more shareholders, the proceeding filed under this Section may not be discontinued or settled, nor may the petitioning shareholder sell or otherwise dispose of his or her shares, unless the court determines that it would be equitable to the corporation and the shareholders, other than the petitioner, to permit the discontinuance, settlement, sale, or other disposition. In considering whether equity exists to approve any settlement, the court may take into consideration the reasonable expectations of the shareholders as set forth in subsection (d), including any existing agreement among the shareholders. | |
(5) If, within 30 days of the filing of the latest |
| election allowed by the court, the parties reach agreement as to the fair value and terms of purchase of the petitioner's shares, the court shall enter an order directing the purchase of petitioner's shares upon the terms and conditions agreed to by the parties. | |
(6) If the parties are unable to reach an agreement |
| as provided for in paragraph (5) of this subsection (f), the court, upon application of any party, shall stay the proceeding under subsection (a) and shall determine the fair value of the petitioner's shares pursuant to subsection (e) as of the day before the date on which the petition under subsection (a) was filed or as of such other date as the court deems appropriate under the circumstances. | |
(g) In any proceeding under this Section, the court shall allow reasonable compensation to the custodian, provisional director, appraiser, or other such person appointed by the court for services rendered and reimbursement or direct payment of reasonable costs and expenses, which amounts shall be paid by the corporation.
(Source: P.A. 94‑394, eff. 8‑1‑05; 94‑889, eff. 1‑1‑07.) |
(805 ILCS 5/12.60) (from Ch. 32, par. 12.60)
Sec. 12.60. Practice in actions under Section 12.50, 12.55, and 12.56.
(a) The practice in actions under Sections 12.50, 12.55, and 12.56 shall be the same as in other civil actions except as may be otherwise provided in this Act. Every action under Section 12.50, 12.55, or 12.56 shall be commenced in the circuit court of the county in which either the registered office or principal office of the corporation is located. Summons shall issue and be served as in other civil actions.
(b) In an action brought by the Attorney General under subsection (a) of Section 12.50, if process is returned not found, the Attorney General shall cause publication to be made as in other civil actions in a newspaper of general circulation published in the county in which the action is filed. The publication shall contain a notice of the pendency of such action, the title of the court, the title of the case, and the date on or after which default may be entered. The Attorney General may include in one notice the names of any number of corporations against which actions are then pending in the same court. The Attorney General shall cause a copy of such notice to be mailed to the corporation at its registered office within 10 days after the first publication thereof. The certificate of the Attorney General of the mailing of such notice shall be prima facie evidence thereof. Such notice shall be published at least once each week for two consecutive weeks and the first publication thereof may begin at any time after summons has been returned. Unless a corporation shall have been served with summons, no default shall be taken against it earlier than 30 days after the first publication of such notice.
(c) It is not necessary to make shareholders of the corporation named in an action under Section 12.50, 12.55, or 12.56 parties to any such action or proceeding unless relief is sought against them personally. The court, in its discretion, may order that the shareholders be made parties.
(d) The circuit court in an action under Section 12.50, 12.55, or 12.56 may issue injunctions, appoint an interim receiver with such powers and duties as the court, from time to time, may direct, and take such other action as is necessary or desirable to preserve the corporate assets and carry on the business of the corporation until a full hearing can be had. Sections 12.50, 12.55, and 12.56 shall not be construed as limiting the equitable powers of the court in ordering interim or permanent relief.
(e) Upon ordering dissolution under Section 12.50, 12.55, or 12.56, and after such notice as the court may direct to be given to all parties to the proceeding and to any other parties in interest designated by the court, the court may appoint a liquidating receiver or receivers with authority to collect the assets of the corporation, including all amounts owing to the corporation by shareholders on account of any unpaid portion of the consideration for the issuance of shares. Such liquidating receiver shall have authority, subject to order of court, to sell, convey, and dispose of all or any part of the assets of the corporation, either at public or private sale, and to make such other action as is necessary to wind up and liquidate the corporation's business and affairs under Section 12.30 and to notify known claimants under Section 12.75. The order appointing such liquidating receiver shall state his or her powers and duties. Such powers and duties may be increased or diminished at any time during the proceedings by the court.
(f) A receiver of a corporation appointed under the provisions of this Section shall have authority to sue and defend in all courts in his or her own name as receiver of such corporation.
(g) A receiver shall in all cases be a resident of this State or a corporation authorized to act as receiver, which corporation may be a domestic corporation or a foreign corporation authorized to transact business in this State, and shall give such bond as the court may direct with such sureties as the court may require.
(h) During the pendency of the action, the court may redesignate a receiver as a custodian, or a custodian as a receiver, if such would be to the general advantage of the corporation, its shareholders and its creditors.
(i) The court shall allow reasonable compensation to the receiver or the custodian for services rendered and reimbursement or direct payment of reasonable expenses from the assets of the corporation or the proceeds of sale of the assets.
(j) If the court finds that a party to any proceeding under Section 12.50, 12.55, or 12.56 acted arbitrarily, vexatiously, or otherwise not in good faith, it may award one or more other parties their reasonable expenses, including counsel fees and the expenses of appraisers or other experts, incurred in the proceeding.
(Source: P.A. 89‑169, eff. 7‑19‑95; 89‑364, eff. 8‑18‑95.) |