Chapter 601 – Business Corporations
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CHAPTER 601*
BUSINESS CORPORATIONS
*Cited. 45 CS 101.
Table of Contents
Sec. 33-600. Short title: Connecticut Business Corporation Act.
Sec. 33-601. Construction of statutes.
Sec. 33-602. Definitions.
Sec. 33-603. Notices and other communications.
Sec. 33-603a. Householding.
Sec. 33-604. Number of shareholders.
Sec. 33-605. Qualified director.
Sec. 33-606. Defective corporate actions. Definitions.
Sec. 33-606a. Defective corporate action not void or voidable, when.
Sec. 33-606b. Ratification of defective corporate actions.
Sec. 33-606c. Action on ratification.
Sec. 33-606d. Notice requirements re action on ratification.
Sec. 33-606e. Effect of ratification.
Sec. 33-606f. Filings.
Sec. 33-606g. Judicial proceeding re validity of corporate action.
Sec. 33-607. Reserved
Sec. 33-608. Filing requirements.
Sec. 33-609. Forms. Mailing address.
Sec. 33-610. Effective time and date of document.
Sec. 33-611. Correcting filed document.
Sec. 33-612. Filing duty of Secretary of the State.
Sec. 33-613. Appeal from Secretary of the State’s refusal to file document.
Sec. 33-614. Evidentiary effect of copy of filed document.
Sec. 33-615. Certificate of existence or authorization.
Sec. 33-616. Penalty for signing false document.
Sec. 33-617. Fees payable to Secretary of the State.
Sec. 33-618. Franchise tax.
Secs. 33-619 to 33-621. Reserved
Sec. 33-622. Powers of Secretary of the State.
Sec. 33-623. Regulations regarding electronic filing.
Sec. 33-624. Interrogatories by Secretary of the State.
Secs. 33-625 to 33-634. Reserved
Sec. 33-635. Incorporators.
Sec. 33-636. Certificate of incorporation.
Sec. 33-637. Incorporation.
Sec. 33-638. Liability for preincorporation transactions.
Sec. 33-639. Organization of corporation.
Sec. 33-640. Bylaws.
Sec. 33-641. Emergency bylaws.
Sec. 33-642. Certificate of incorporation or bylaws may require that internal corporate claims be brought in specified courts.
Secs. 33-643 and 33-644. Reserved
Sec. 33-645. Purposes.
Sec. 33-646. Authorization to form corporation to transact insurance business.
Sec. 33-647. General powers.
Sec. 33-648. Emergency powers.
Sec. 33-649. Ultra vires.
Secs. 33-650 to 33-654. Reserved
Sec. 33-655. Corporate name.
Sec. 33-656. Reserved name.
Sec. 33-657. Registered name.
Secs. 33-658 and 33-659. Reserved
Sec. 33-660. Registered office and registered agent.
Sec. 33-661. Change of registered office or registered agent.
Sec. 33-662. Resignation of registered agent.
Sec. 33-663. Service of process on corporation.
Sec. 33-664. Reserved
Sec. 33-665. Authorized shares.
Sec. 33-666. Terms of class or series of shares.
Sec. 33-667. Issued and outstanding shares.
Sec. 33-668. Fractional shares.
Secs. 33-669 and 33-670. Reserved
Sec. 33-671. Subscription for shares before incorporation.
Sec. 33-672. Issuance of shares.
Sec. 33-673. Liability of shareholders.
Sec. 33-673a. Definitions.
Sec. 33-673b. Limitation on liability of an interest holder of a domestic entity. Application of veil piercing doctrine, when permitted.
Sec. 33-673c. Liability of domestic entity based upon reverse veil piercing doctrine, not permitted.
Sec. 33-674. Share dividends.
Sec. 33-675. Share options and other equity compensation awards.
Sec. 33-676. Form and content of certificates.
Sec. 33-677. Shares without certificates.
Sec. 33-678. Restriction on transfer of shares and other securities.
Sec. 33-679. Expense of issue.
Sec. 33-680. Surrender of share certificates.
Secs. 33-681 and 33-682. Reserved
Sec. 33-683. Shareholder’s preemptive rights.
Sec. 33-684. Corporation’s acquisition of its own shares.
Secs. 33-685 and 33-686. Reserved
Sec. 33-687. Distributions to shareholders.
Secs. 33-688 to 33-694. Reserved
Sec. 33-695. Annual meeting.
Sec. 33-696. Special meeting.
Sec. 33-697. Court-ordered meeting.
Sec. 33-698. Action without meeting.
Sec. 33-699. Notice of meeting.
Sec. 33-700. Waiver of notice.
Sec. 33-701. Record date.
Sec. 33-702. Chairperson to preside.
Sec. 33-703. Remote participation in annual and special meetings.
Sec. 33-704. Shareholders’ list for meeting.
Sec. 33-705. Voting entitlement of shares.
Sec. 33-706. Proxies.
Sec. 33-707. Shares held by nominees.
Sec. 33-708. Corporation’s acceptance or rejection of votes.
Sec. 33-709. Quorum and voting requirements for voting groups.
Sec. 33-710. Action by single and multiple voting groups.
Sec. 33-711. Greater quorum or voting requirement.
Sec. 33-712. Voting for directors. Cumulative voting.
Sec. 33-713. Inspectors.
Sec. 33-714. Reserved
Sec. 33-715. Voting trust.
Sec. 33-716. Voting agreement.
Sec. 33-717. Shareholder agreement.
Secs. 33-718 and 33-719. Reserved
Sec. 33-720. Derivative proceedings. Definitions.
Sec. 33-721. Standing.
Sec. 33-722. Demand.
Sec. 33-723. Stay of proceedings.
Sec. 33-724. Dismissal.
Sec. 33-725. Discontinuance or settlement.
Sec. 33-726. Payment of expenses.
Sec. 33-727. Applicability to foreign corporations.
Secs. 33-728 to 33-734. Reserved
Sec. 33-735. Requirements for and duties of board of directors.
Sec. 33-736. Qualifications for directors or nominees for directors.
Sec. 33-737. Number and election of directors.
Sec. 33-738. Election of directors by certain classes of shareholders.
Sec. 33-739. Terms of directors generally.
Sec. 33-740. Staggered terms for directors.
Sec. 33-741. Resignation of directors.
Sec. 33-742. Removal of directors by shareholders.
Sec. 33-743. Removal of directors by judicial proceeding.
Sec. 33-744. Vacancy on board of directors.
Sec. 33-745. Compensation of directors.
Secs. 33-746 and 33-747. Reserved
Sec. 33-748. Meetings.
Sec. 33-749. Action without meeting.
Sec. 33-750. Notice of meeting.
Sec. 33-751. Waiver of notice.
Sec. 33-752. Quorum and voting.
Sec. 33-753. Committees.
Sec. 33-754. Submission of matters for shareholder vote.
Sec. 33-755. Reserved
Sec. 33-756. General standards of conduct for directors.
Sec. 33-757. Liability for unlawful distribution.
Sec. 33-758. General standards of liability for directors.
Secs. 33-759 to 33-762. Reserved
Sec. 33-763. Officers.
Sec. 33-764. Functions of officers.
Sec. 33-765. Standards of conduct for officers.
Sec. 33-766. Resignation and removal of officers.
Sec. 33-767. Contract rights of officers.
Secs. 33-768 and 33-769. Reserved
Sec. 33-770. Definitions.
Sec. 33-771. Permissible indemnification.
Sec. 33-772. Mandatory indemnification.
Sec. 33-773. Advance for expenses.
Sec. 33-774. Court-ordered indemnification and advance for expenses.
Sec. 33-775. Determination and authorization of indemnification.
Sec. 33-776. Indemnification of and advance for expenses to officers. Indemnification by corporations incorporated prior to January 1, 1997.
Sec. 33-777. Insurance.
Sec. 33-778. Variation by corporate action.
Sec. 33-779. Exclusivity of provisions.
Sec. 33-780. Reserved
Sec. 33-781. Definitions.
Sec. 33-782. Judicial action.
Sec. 33-783. Directors’ action.
Sec. 33-784. Shareholders’ action.
Sec. 33-785. Taking advantage of a business opportunity.
Secs. 33-786 to 33-794. Reserved
Sec. 33-795. Authority to amend.
Sec. 33-796. Amendment by board of directors.
Sec. 33-797. Amendment by board of directors and shareholders.
Sec. 33-798. Voting on amendments by voting groups.
Sec. 33-799. Amendment before issuance of shares.
Sec. 33-800. Certificate of amendment.
Sec. 33-801. Restated certificate of incorporation.
Sec. 33-802. Amendment pursuant to reorganization.
Sec. 33-803. Effect of amendment.
Secs. 33-804 and 33-805. Reserved
Sec. 33-806. Amendment by shareholders or board of directors.
Sec. 33-807. Bylaw increasing quorum or voting requirement for shareholders.
Sec. 33-808. Bylaw increasing quorum or voting requirement for directors.
Sec. 33-809. Bylaw provisions relating to the election of directors.
Secs. 33-810 to 33-813. Reserved
Sec. 33-814. Definitions.
Sec. 33-815. Merger.
Sec. 33-816. Share exchange.
Sec. 33-817. Action on plan of merger or share exchange.
Sec. 33-818. Merger of subsidiary.
Sec. 33-819. Certificate of merger or share exchange.
Sec. 33-820. Effect of merger or share exchange.
Sec. 33-821. Merger or share exchange with foreign corporation.
Sec. 33-821a. Abandoned merger or share exchange.
Secs. 33-822 to 33-829. Reserved
Sec. 33-830. Sale or other disposition of assets in regular course of business. Mortgage or other encumbrance, transfer or distribution of assets.
Sec. 33-831. Sale or other disposition of assets leaving no significant continuing business activity.
Secs. 33-832 to 33-839. Reserved
Sec. 33-840. Business combinations. Definitions.
Sec. 33-841. Approval of business combination.
Sec. 33-842. Exceptions.
Sec. 33-843. Business combinations. Definitions.
Sec. 33-844. Business combination with interested shareholder prohibited for five years unless approved by board of directors.
Sec. 33-845. Excepted business combinations.
Secs. 33-846 to 33-854. Reserved
Sec. 33-855. Definitions.
Sec. 33-856. Right to appraisal.
Sec. 33-857. Assertion of rights by nominees and beneficial owners.
Secs. 33-858 and 33-859. Reserved
Sec. 33-860. Notice of appraisal rights.
Sec. 33-861. Notice of intent to demand payment. Consequences of voting or consenting.
Sec. 33-862. Appraisal notice and form.
Sec. 33-863. Perfection of rights. Right to withdraw.
Sec. 33-864. Share restrictions.
Sec. 33-865. Payment.
Sec. 33-866. Failure to take action.
Sec. 33-867. After-acquired shares.
Sec. 33-868. Procedure if shareholder dissatisfied with payment or offer.
Secs. 33-869 and 33-870. Reserved
Sec. 33-871. Court action.
Sec. 33-872. Court costs and expenses.
Secs. 33-873 to 33-879. Reserved
Sec. 33-880. Dissolution by incorporators or initial directors.
Sec. 33-881. Dissolution by board of directors and shareholders.
Sec. 33-882. Certificate of dissolution.
Sec. 33-883. Revocation of dissolution.
Sec. 33-884. Effect of dissolution.
Sec. 33-885. Requirements prior to final liquidating distribution of assets.
Sec. 33-886. Known claims against dissolved corporation.
Sec. 33-887. Unknown claims against dissolved corporation.
Sec. 33-887a. Proceeding for determination of security for payment of contingent or unknown claims or claims arising after dissolution.
Sec. 33-887b. Duties of directors of dissolved corporation.
Secs. 33-888 and 33-889. Reserved
Sec. 33-890. Administrative dissolution.
Sec. 33-891. Effect of administrative dissolution.
Sec. 33-892. Reinstatement following administrative dissolution.
Sec. 33-893. Appeal from refusal of reinstatement.
Secs. 33-894 and 33-895. Reserved
Sec. 33-896. Grounds for judicial dissolution.
Sec. 33-897. Procedure for judicial dissolution.
Sec. 33-898. Receivership or custodianship.
Sec. 33-899. Decree of dissolution.
Sec. 33-900. Election to purchase in lieu of dissolution.
Secs. 33-901 and 33-902. Reserved
Sec. 33-903. Deposit of assets with State Treasurer or other state official.
Secs. 33-904 to 33-909. Reserved
Sec. 33-910. Provisions applicable to specially chartered corporations.
Sec. 33-911. Formation of specially chartered corporation.
Sec. 33-912. Amendment of special charter.
Sec. 33-913. Surrender of charter and reincorporation.
Sec. 33-914. Franchise tax.
Secs. 33-915 to 33-919. Reserved
Sec. 33-920. Authority to transact business required.
Sec. 33-921. Consequences of transacting business without authority.
Sec. 33-921a. Limited amnesty for foreign corporation transacting business without authority.
Sec. 33-922. Application for certificate of authority.
Sec. 33-923. Amended certificate of authority.
Sec. 33-924. Effect of certificate of authority.
Sec. 33-925. Corporate name of foreign corporation.
Sec. 33-926. Registered office and registered agent of foreign corporation.
Sec. 33-927. Change of registered office or registered agent of foreign corporation.
Sec. 33-928. Resignation of registered agent of foreign corporation.
Sec. 33-929. Service of process on foreign corporation.
Secs. 33-930 and 33-931. Reserved
Sec. 33-932. Withdrawal of foreign corporation.
Secs. 33-933 and 33-934. Reserved
Sec. 33-935. Grounds for revocation.
Sec. 33-936. Procedure for and effect of revocation.
Sec. 33-937. Appeal from revocation.
Secs. 33-938 to 33-944. Reserved
Sec. 33-945. Corporate records.
Sec. 33-946. Inspection of records by shareholders.
Sec. 33-947. Scope of inspection right.
Sec. 33-948. Court-ordered inspection.
Sec. 33-949. Inspection of records by directors.
Sec. 33-950. Exception to notice requirement.
Sec. 33-951. Financial statements for shareholders.
Sec. 33-952. Other reports to shareholders.
Sec. 33-953. Reports.
Sec. 33-954. Failure to file report. Incorrect report.
Sec. 33-955. Interim notice of change of director or officer.
Secs. 33-956 to 33-994. Reserved
Sec. 33-995. Applicability to domestic corporations in existence on January 1, 1997.
Sec. 33-996. Applicability to qualified foreign corporations.
Sec. 33-997. Saving provisions.
Sec. 33-997a. Reservation of power to amend or repeal.
Sec. 33-998. Severability.
Sec. 33-999. Reserved
PART I
GENERAL PROVISIONS
Sec. 33-600. Short title: Connecticut Business Corporation Act. Sections 33-600 to 33-998, inclusive, shall be known and may be cited as the “Connecticut Business Corporation Act”.
(P.A. 94-186, S. 1, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-601. Construction of statutes. (a) Sections 33-600 to 33-998, inclusive, shall be so construed as to provide for a general corporate form for the conduct of lawful business with such variations and modifications from the form so provided as the interested parties may agree upon, subject to the interests of the state and third parties. Whether or not a section of said sections contains the words “unless the certificate of incorporation or bylaws otherwise provide”, or words of similar import, no provision of a certificate of incorporation or bylaw shall be held invalid on the ground that it is inconsistent with such section unless such section expressly prohibits variations therefrom or prescribes minimum or maximum numerical requirements, or a substantial interest of the state or third parties is adversely affected thereby.
(b) If the certificate of incorporation in effect on January 1, 1997, of a corporation with capital stock formed under the laws of this state, whether general law or special act, prior to said date, contains any provision contrary to, inconsistent with or in addition to any provision of sections 33-600 to 33-998, inclusive, but which provision was permitted to be contained in such certificate pursuant to the provisions of applicable law in effect prior to January 1, 1997, the provisions contained in such certificate shall govern such corporation and the provisions of said sections shall not be held or construed to alter or affect any provision of the certificate of incorporation of such corporation inconsistent with the provisions of said sections, except as provided in sections 33-890, 33-913, 33-953 and 33-954.
(P.A. 94-186, S. 3, 215; P.A. 96-271, S. 1, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace reference to “chapter 599 of the general statutes, revised to January 1, 1995” with “applicable law in effect prior to January 1, 1997”, effective January 1, 1997.
Sec. 33-602. Definitions. As used in sections 33-600 to 33-998, inclusive:
(1) “Address” means location as described by the full street number, if any, street, city or town, state or country and not a mailing address such as a post office box.
(2) “Authorized shares” means the shares of all classes a domestic or foreign corporation is authorized to issue.
(3) “Beneficial shareholder” means a person who owns the beneficial interest in shares, which may be a record shareholder or a person on whose behalf shares are registered in the name of an intermediary or nominee.
(4) “Certificate of incorporation” means the original certificate of incorporation or restated certificate of incorporation, and all amendments thereto, and all certificates of merger or consolidation. In the case of a specially chartered corporation, “certificate of incorporation” means the special charter of the corporation, including any portions of the charters of its predecessor companies which have continuing effect, and any amendments to the charter made by special act or pursuant to general law. In the case of a corporation formed before January 1, 1961, or of a specially chartered corporation, “certificate of incorporation” includes those portions of any other corporate instruments or resolutions of current application in which are set out provisions of the sort which either (A) are required by sections 33-600 to 33-998, inclusive, to be embodied in the certificate of incorporation, or (B) are expressly permitted by sections 33-600 to 33-998, inclusive, to be operative only if included in the certificate of incorporation. It also includes what were, prior to January 1, 1961, designated at law as agreements of association, articles of incorporation, charters and other such terms.
(5) “Conspicuous” means so written, displayed or presented that a reasonable person against whom the writing is to operate should have noticed it. For example, text in italics, boldface, contrasting color, capitals or underlined is conspicuous.
(6) “Corporation” or “domestic corporation” means a stock corporation, which is not a foreign corporation, incorporated under the laws of this state, whether general law or special act and whether before or after January 1, 1997.
(7) “Deliver” or “delivery” means any method of delivery used in conventional commercial practice including delivery by hand, mail, commercial delivery and, if authorized in accordance with section 33-603, electronic transmission.
(8) “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.
(9) “Document” means (A) any tangible medium on which information is inscribed, and includes any writing or written instrument, or (B) an electronic record.
(10) “Domestic”, with respect to an entity, means an entity governed as to its internal affairs by the law of this state.
(11) “Effective date of notice” is defined in section 33-603.
(12) (A) “Electronic” means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities.
(B) “Electronic record” means information that is stored in an electronic or other medium and is retrievable in paper form through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with subsection (j) of section 33-603.
(C) “Electronic transmission” or “electronically transmitted” means any form or process of communication not directly involving the physical transfer of paper or another tangible medium, which (i) is suitable for the retention, retrieval and reproduction of information by the recipient, and (ii) is retrievable in paper form by the recipient through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with subsection (j) of section 33-603.
(13) “Employee” includes an officer but not a director. A director may accept duties that make him also an employee.
(14) “Entity” includes a corporation and foreign corporation; nonprofit corporation; profit and nonprofit unincorporated association; business trust, estate, partnership, limited liability company, trust and two or more persons having a joint or common economic interest; and state, United States or foreign government.
(15) “Expenses” means reasonable expenses of any kind that are incurred in connection with a matter including, but not limited to, reasonable counsel fees.
(16) “Facts objectively ascertainable” outside of a plan or filed document is defined in subsection (l) of section 33-608.
(17) “Foreign”, with respect to an entity, means an entity governed as to its internal affairs by the laws of a jurisdiction other than this state.
(18) “Foreign corporation” means a corporation incorporated under a law other than the law of this state.
(19) “Governmental subdivision” includes authority, county, district and municipality.
(20) “Includes” denotes a partial definition.
(21) “Individual” includes the estate of an incompetent or deceased individual.
(22) “Means” denotes an exhaustive definition.
(23) “Merger” means a transaction pursuant to section 33-815.
(24) “Notice” is defined in section 33-603.
(25) “Person” includes individual and entity.
(26) “Principal office” of a domestic corporation means the address of the principal office of such corporation in this state, if any, as the same appears in the last annual report, if any, filed by such corporation with the Secretary of the State. If no principal office so appears, the corporation’s “principal office” means the address in this state of the corporation’s registered agent for service as last shown on the records of the Secretary of the State. In the case of a domestic corporation which has not filed such an annual report or appointment of registered agent for service, the “principal office” means the address of the principal place of business of such corporation in this state, if any, and if such corporation has no place of business in this state, its “principal office” shall be the office of the Secretary of the State.
(27) “Proceeding” includes civil suit and criminal, administrative and investigatory action.
(28) “Public corporation” means 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.
(29) “Qualified director” is defined in section 33-605.
(30) “Record date” means the date established under sections 33-665 to 33-687, inclusive, or sections 33-695 to 33-727, inclusive, on which a corporation determines the identity of its shareholders and their shareholdings for purposes of sections 33-600 to 33-998, inclusive. 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.
(31) “Secretary” means the corporate officer to whom under the bylaws or by the board of directors is delegated responsibility under subsection (c) of section 33-763 for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation.
(32) “Secretary of the State” means the Secretary of the State of Connecticut.
(33) “Share exchange” means a transaction pursuant to section 33-816.
(34) “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.
(35) “Shares” means the units into which the proprietary interests in a corporation are divided.
(36) “Sign” or “signature” means, with present intent to authenticate or adopt a document: (A) To execute or adopt a tangible symbol to a document, and includes any manual, facsimile or conformed signature; or (B) to attach to or logically associate with an electronic transmission an electronic sound, symbol or process, and includes an electronic signature in an electronic transmission.
(37) “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.
(38) “Subscriber” means a person who subscribes for shares in a corporation, whether before or after incorporation.
(39) “United States” includes any district, authority, bureau, commission, department and other agency of the United States.
(40) “Unrestricted voting trust beneficial owner” means, with respect to any shareholder rights, a voting trust beneficial owner whose entitlement to exercise the shareholder right in question is not inconsistent with the voting trust agreement.
(41) “Voting group” means all shares of one or more classes or series that under the certificate of incorporation or sections 33-600 to 33-998, inclusive, are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. All shares entitled by the certificate of incorporation or said sections to vote generally on the matter are for that purpose a single voting group.
(42) “Voting power” means the current power to vote in the election of directors.
(43) “Voting trust beneficial owner” means an owner of a beneficial interest in shares of the corporation held in a voting trust established pursuant to subsection (a) of section 33-715.
(44) “Writing” or “written” means any information in the form of a document.
(P.A. 94-186, S. 17, 215; P.A. 95-79, S. 125, 189; P.A. 96-271, S. 2, 254; P.A. 98-137, S. 1, 62; 98-219, S. 33, 34; P.A. 01-199, S. 1–3; P.A. 03-18, S. 2; 03-158, S. 3; P.A. 06-68, S. 1; P.A. 09-55, S. 17; P.A. 11-147, S. 10; P.A. 17-108, S. 21.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-79 redefined “entity” to include a limited liability company, effective January 1, 1997; P.A. 96-271 replaced definition of “articles of incorporation” with definition of “certificate of incorporation”, renumbering definition of “authorized shares” as Subdiv. (2), amended definition of “corporation” to replace “corporation for profit” with “corporation with capital stock”, amended definition of “entity” to replace references to “not-for-profit” with “nonprofit”, amended definition of “foreign corporation” to delete “for profit” following “corporation” in definitional language, amended definition of “secretary” to replace “to whom the board of directors has delegated” with “to whom under the bylaws or by the board of directors is delegated”, amended definition of “transmitted by electronic means” to delete provision that the process of communication be prescribed by the Secretary of the State “as suitable for retention, retrieval and reproduction by the Secretary of the State of the product of that process of communication”, and amended definition of “voting group” to replace references to “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 98-137 redefined “deliver”, added definitions of “electronic transmission or electronically transmitted” and “sign or signature”, deleted definition of “transmitted by electronic means” and renumbered the remaining Subdivs. accordingly, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 01-199 redefined “deliver” to make definition also applicable to term “delivery”, redefined “electronic transmission” or “electronically transmitted” to reposition provision re “not directly involving the physical transfer of paper” and redefined “sign” or “signature” to include an electronic signature; P.A. 03-18 added definition of “voting power”, effective July 1, 2003; P.A. 03-158 made a technical change in Subdiv. (3), added new Subdiv. (13) re facts objectively ascertainable outside of a plan or filed document and redesignated existing Subdivs. (13) to (31) as Subdivs. (14) to (32); P.A. 06-68 added new Subdivs. (23) and (24) defining “public corporation” and “qualified director” and redesignated existing Subdivs. (23) to (33) as Subdivs. (25) to (35); P.A. 09-55 made definitions applicable to Secs. 33-603a and 33-809, added new Subdiv. (13) defining “expenses” and redesignated existing Subdivs. (13) to (35) as Subdivs. (14) to (36); P.A. 11-147 redefined “conspicuous”, “deliver” or “delivery”, “document”, “electronic transmission” or “electronically transmitted” and “sign” or “signature” and added definitions of “electronic”, “electronic record” and “writing” or “written”; P.A. 17-108 added new Subdiv. (3) defining “beneficial shareholder”, redesignated existing Subdivs. (3) to (8) as Subdivs. (4) to (9), amended redesignated Subdiv. (6) to redefine “corporation” or “domestic corporation”, added new Subdiv. (10) defining “domestic”, redesignated existing Subdivs. (9) to (14) as Subdivs. (11) to (16), added new Subdiv. (17) defining “foreign”, redesignated existing Subdivs. (15) to (19) as Subdivs. (18) to (22), added new Subdiv. (23) defining “merger”, redesignated existing Subdivs. (20) to (28) as Subdivs. (24) to (32), added new Subdiv. (33) defining “share exchange”, redesignated existing Subdiv. (29) as Subdiv. (35), redesignated existing Subdiv. (30) as Subdiv. (34), redesignated existing Subdivs. (31) to (34) as Subdivs. (36) to (39), added Subdiv. (40) defining “unrestricted voting trust beneficial owner”, redesignated Subdivs. (35) and (36) as Subdivs. (41) and (42), added Subdiv. (43) defining “voting trust beneficial owner” and redesignated existing Subdiv. (37) as Subdiv. (44).
Cited. 45 CS 101.
Sec. 33-603. Notices and other communications. (a) Notice under sections 33-600 to 33-998, inclusive, shall be in writing unless oral notice is reasonable in the circumstances. Unless otherwise agreed between the sender and the recipient, words in a notice or other communication under sections 33-600 to 33-998, inclusive, shall be in English.
(b) A notice or other communication may be given or sent by any method of delivery, except that electronic transmissions must be in accordance with this section. If these methods of delivery are impracticable, a notice or other communication may be communicated by a newspaper of general circulation in the area where published or by radio, television or other form of public broadcast communication.
(c) Notice or other communication to a domestic or foreign corporation authorized to transact business in this state may be delivered to its registered agent at its registered office or to the secretary of the corporation at its principal office shown in its most recent annual report or, in the case of a foreign corporation that has not yet delivered an annual report, in its application for a certificate of authority.
(d) Notice or other communications may be delivered by electronic transmission if (1) consented to by the recipient or authorized by subsection (k) of this section, and (2) the electronic transmission contains or is accompanied by information from which the recipient can determine the date of the transmission and that the transmission was authorized by the sender or the sender’s agent or attorney-in-fact.
(e) Any consent under subsection (d) of this section may be revoked by the person who consented by written or electronic notice to the person to whom the consent was delivered. Any such consent is deemed revoked if (1) the corporation is unable to deliver two consecutive electronic transmissions given by the corporation in accordance with such consent, and (2) such inability becomes known to the secretary or an assistant secretary of the corporation or to the transfer agent, or other person responsible for the giving of notice or other communications; provided, the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action.
(f) Unless otherwise agreed between the sender and the recipient, an electronic transmission is received when: (1) It enters an information processing system that the recipient has designated or uses for the purposes of receiving electronic transmissions or information of the type sent, and from which the recipient is able to retrieve the electronic transmission; and (2) it is in a form capable of being processed by that system.
(g) Receipt of an electronic acknowledgment from an information processing system described in subdivision (1) of subsection (f) of this section establishes that an electronic transmission was received but, by itself, does not establish that the content sent corresponds to the content received.
(h) An electronic transmission is received under this section even if no individual is aware of its receipt.
(i) Notice or other communication, if in a comprehensible form or manner, is effective at the earliest of the following:
(1) If in physical form, the earliest of: (A) When it is actually received; or (B) when it is left at: (i) A shareholder’s address shown on the corporation’s record of shareholders maintained by the corporation under subsection (c) of section 33-945; (ii) a director’s residence or usual place of business; or (iii) the corporation’s principal place of business;
(2) If mailed postage prepaid and correctly addressed to a shareholder, upon deposit in the United States mail;
(3) If mailed by United States mail postage prepaid and correctly addressed to a recipient other than a shareholder, the earliest of: (A) When it is actually received; (B) if sent by registered or certified mail, return receipt requested, the date shown on the return receipt signed by or on behalf of the addressee; or (C) five days after it is deposited in the United States mail;
(4) If an electronic transmission, when it is received as provided in subsection (f) of this section; or
(5) If oral, when communicated.
(j) A notice or other communication may be in the form of an electronic transmission that cannot be directly reproduced in paper form by the recipient through an automated process used in conventional commercial practice only if (1) the electronic transmission is otherwise retrievable in perceivable form, and (2) the sender and the recipient have consented in writing to the use of such form of electronic transmission.
(k) If sections 33-600 to 33-998, inclusive, prescribe requirements for notices or other communications in particular circumstances, those requirements govern. If a certificate of incorporation or bylaw prescribes requirements for notices or other communications, not inconsistent with this section or other provisions of said sections, those requirements govern. The certificate of incorporation or bylaws may authorize or require delivery of notices of meetings of directors by electronic transmission.
(l) In computing the period of time of any notice required or permitted to be given by sections 33-600 to 33-998, inclusive, or under the provisions of the certificate of incorporation or bylaws of a corporation or of a resolution of shareholders or directors, the day on which the notice is given shall be excluded, and the day on which the matter noticed is to occur shall be included, in the absence of a contrary provision.
(P.A. 94-186, S. 18, 215; P.A. 96-271, S. 3, 254; P.A. 97-246, S. 1, 2, 99; P.A. 98-137, S. 2, 62; 98-219, S. 33, 34; P.A. 01-199, S. 4; P.A. 10-35, S. 1; P.A. 11-147, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (g) to replace “articles” of incorporation with “certificate” of incorporation and “bylaws” with “bylaw”, effective January 1, 1997; P.A. 97-246 amended Subsecs. (c) and (e) to replace “postpaid” with “postage prepaid”, effective June 27, 1997; P.A. 98-137 amended Subsec. (a) to replace “Notice transmitted or received electronically is in writing and is written notice if it is accomplished in a manner that is suitable for retention, retrieval and reproduction of the notice by the recipient” with “Written notice includes notice by electronic transmission”, amended Subsec. (b) to authorize notice “by mail or other method of delivery, or by telephone, voice mail or other electronic means” rather than “by telephone, telegraph, teletype or other form of wire or wireless communication, or by mail or private carrier”, amended Subsec. (c)(2) to replace “when transmitted by facsimile or other electronic means if transmitted to the shareholder in the manner authorized by the shareholder for purposes of facsimile or electronic transmission, as the case may be” with “when electronically transmitted to the shareholder in a manner authorized by the shareholder”, and amended Subsec. (e)(2) to delete “as evidenced by the postmark”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 01-199 amended Subsec. (a) to replace “Written notice includes notice by electronic transmission” with “Notice by electronic transmission is written notice” and made a technical change in Subsec. (e); P.A. 10-35 amended Subsec. (d) to substitute “secretary of the corporation” for “corporation or its secretary” re addressee; P.A. 11-147 amended Subsec. (a) to delete “Notice by electronic transmission is written notice”, add provision requiring words in notice or other communication to be in English unless otherwise agreed and make a technical change, amended Subsec. (b) to replace “Notice may be communicated in person, by mail or other method of delivery, or by telephone, voice mail or other electronic means” with “A notice or other communication may be given or sent by any method of delivery, except that electronic transmissions must be in accordance with this section”, replace “If these forms of personal notice” with “If these methods of delivery” and replace “notice” with “a notice or other communication”, deleted former Subsec. (c) re when written notice to a shareholder is effective, redesignated existing Subsec. (d) as Subsec. (c) and amended same to replace “Written notice” with “Notice or other communication” and replace “addressed” with “delivered”, deleted former Subsec. (e) re earliest date that written notice is effective, deleted former Subsec. (f) re when oral notice is effective, added new Subsec. (d) re when notice or other communications may be delivered by electronic transmission, added new Subsec. (e) re revocation of consent for delivery by electronic transmission, added new Subsec. (f) re when electronic transmission is considered received, added new Subsec. (g) re effect of receipt of electronic acknowledgement, added new Subsec. (h) re electronic transmission considered received even if no individual is aware of its receipt, added new Subsec. (i) re earliest date that notice or other communication is effective, added new Subsec. (j) re when notice or other communication may be in form of electronic transmission that cannot be directly reproduced in paper form by recipient through automated process used in conventional commercial practice, redesignated existing Subsec. (g) as Subsec. (k) and amended same to replace “notice requirements” with “requirements for notices or other communications” and add provision re certificate of incorporation or bylaws may authorize or require delivery of notices of meetings of directors by electronic transmission and redesignated existing Subsec. (h) as Subsec. (l).
See Sec. 1-2a re construction of references to “United States mail”, “postmark” or “registered or certified mail”.
Sec. 33-603a. Householding. (a) A corporation has delivered written notice or any other report or statement under any provision of sections 33-600 to 33-998, inclusive, the certificate of incorporation or the bylaws to all shareholders who share a common address if:
(1) The corporation delivers one copy of the notice, report or statement to the common address;
(2) The corporation addresses the notice, report or statement to those shareholders either as a group, to each of those shareholders individually or to the shareholders in a form to which each of those shareholders has consented; and
(3) Each of those shareholders consents to delivery of a single copy of such notice, report or statement to the shareholders’ common address. Any such consent shall be revocable by any of such shareholders who delivers written notice of revocation to the corporation. If such written notice of revocation is delivered, the corporation shall begin providing individual notices, reports or other statements to the revoking shareholder no later than thirty days after delivery of the written notice of revocation.
(b) Any shareholder who fails to object by written notice to the corporation, within sixty days of written notice by the corporation of its intention to send single copies of notices, reports or statements to shareholders who share a common address as permitted by subsection (a) of this section, shall be deemed to have consented to receiving such single copy at the common address.
(P.A. 09-55, S. 22.)
Sec. 33-604. Number of shareholders. (a) For purposes of sections 33-600 to 33-998, inclusive, the following identified as a shareholder in a corporation’s current record of shareholders constitutes one shareholder: (1) Three or fewer co-owners; (2) a corporation, partnership, trust, estate or other entity; (3) the trustees, guardians, custodians or other fiduciaries of a single trust, estate or account.
(b) For purposes of sections 33-600 to 33-998, inclusive, shareholdings registered in substantially similar names constitute one shareholder if it is reasonable to believe that the names represent the same person.
(P.A. 94-186, S. 19, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-605. Qualified director. (a) For purposes of sections 33-600 to 33-998, inclusive, a qualified director is a director who, at the time action is to be taken under:
(1) Subdivision (6) of subsection (b) of section 33-636, is not a director (A) to whom the limitation or elimination of the duty of an officer to offer potential business opportunities to the corporation would apply, or (B) who has a material relationship with any other person to whom the limitation or elimination would apply;
(2) Section 33-724, does not have (A) a material interest in the outcome of the proceeding, or (B) a material relationship with a person who has such an interest;
(3) Section 33-773 or 33-775, (A) is not a party to the proceeding, (B) is not a director as to whom the transaction is a director’s conflicting interest transaction or who sought a disclaimer of the corporation’s interest in a business opportunity under section 33-785, which transaction or disclaimer is challenged in the proceeding, and (C) does not have a material relationship with a director described in either subparagraph (A) or (B) of this subdivision;
(4) Section 33-783, is not a director (A) as to whom the transaction is a director’s conflicting interest transaction, or (B) who has a material relationship with another director as to whom the transaction is a director’s conflicting interest transaction; or
(5) Section 33-785, is not a director who (A) pursues or takes advantage of the business opportunity, directly, or indirectly through or on behalf of another person, or (B) has a material relationship with a director or officer who pursues or takes advantage of the business opportunity, directly, or indirectly through or on behalf of another person.
(b) For purposes of this section:
(1) “Material relationship” means a familial, financial, professional or employment relationship that would reasonably be expected to impair the objectivity of the director’s judgment when participating in the action to be taken; and
(2) “Material interest” means an actual or potential benefit or detriment, other than one which would devolve on the corporation or the shareholders generally, that would reasonably be expected to impair the objectivity of the director’s judgment when participating in the action to be taken.
(c) The presence of one or more of the following circumstances shall not by itself prevent a director from being a qualified director:
(1) Nomination or election of the director to the current board by any director who is not a qualified director with respect to the matter, or by any person that has a material relationship with that director, acting alone or participating with others;
(2) Service as a director of another corporation of which a director who is not a qualified director with respect to the matter, or any individual who has a material relationship with that director, is also a director; or
(3) With respect to action to be taken under section 33-724, status as a named defendant, as a director against whom action is demanded or as a director who approved the conduct being challenged.
(P.A. 06-68, S. 2; P.A. 17-108, S. 11.)
History: P.A. 17-108 amended Subsec. (a) to add new Subdiv. (1) re director under Sec. 33-636(b)(6), redesignated existing Subdivs. (1) to (4) as Subdivs. (2) to (5), amended redesignated Subdiv. (3)(B) by replacing “who sought approval for” with “as to whom the transaction is”, deleting reference to Sec. 33-783, adding “who sought”, and replacing “approval” with “transaction”, amended redesignated Subdiv. (5) by replacing provisions re qualified director under Sec. 33-785 with provisions re director under Sec. 33-785.
Sec. 33-606. Defective corporate actions. Definitions. As used in this section and sections 33-606a to 33-606g, inclusive:
(1) “Corporate action” means any action taken by or on behalf of the corporation, including any action taken by the incorporator, the board of directors, a committee of the board of directors, an officer or agent of the corporation or the shareholders.
(2) “Date of the defective corporate action” means the date, or the approximate date if the exact date is unknown, the defective corporate action was purported to have been taken.
(3) “Defective corporate action” means (A) any corporate action purportedly taken that is, and at the time such corporate action was purportedly taken would have been, within the power of the corporation, but that is void or voidable due to a failure of authorization, and (B) an overissue.
(4) “Failure of authorization” means the failure to authorize, approve or otherwise effect a corporate action in compliance with the provisions of sections 33-600 to 33-998, inclusive, the certificate of incorporation or bylaws of the corporation, a corporate resolution or any plan or agreement to which the corporation is a party, if and to the extent such failure would render such corporate action void or voidable.
(5) “Overissue” means the purported issuance of: (A) Shares of a class or series in excess of the number of shares of a class or series the corporation has the power to issue under section 33-665 at the time of such issuance; or (B) shares of any class or series that is not then authorized for issuance by the certificate of incorporation.
(6) “Putative shares” means the shares of any class or series, including shares issued upon exercise of rights, options, warrants or other securities convertible into shares of the corporation, or interests with respect to such shares, that were created or issued as a result of a defective corporate action, that (A) but for any failure of authorization would constitute valid shares, or (B) cannot be determined by the board of directors to be valid shares.
(7) “Valid shares” means the shares of any class or series that have been duly authorized and validly issued in accordance with sections 33-600 to 33-998, inclusive, including as a result of ratification or validation under this section and sections 33-606a to 33-606g, inclusive.
(8) “Validation effective time” means, with respect to any defective corporate action ratified under this section and sections 33-606a to 33-606g, inclusive, the later of (A) the time at which the ratification of the defective corporate action is approved by the shareholders, or if approval of shareholders is not required, the time at which the notice required by section 33-606d becomes effective in accordance with section 33-603; and (B) the time at which any certificate of validation filed in accordance with section 33-606f becomes effective. The validation effective time shall not be affected by the filing or pendency of a judicial proceeding under section 33-606g or any other provision of law, unless otherwise ordered by the Superior Court.
(P.A. 17-108, S. 3.)
Sec. 33-606a. Defective corporate action not void or voidable, when. (a) A defective corporate action shall not be void or voidable if ratified in accordance with section 33-606b or validated in accordance with section 33-606g.
(b) Ratification under section 33-606b or validation under section 33-606g shall not be deemed to be the exclusive means of ratifying or validating any defective corporate action, and the absence or failure of ratification in accordance with sections 33-606 to 33-606g, inclusive, shall not, of itself, affect the validity or effectiveness of any corporate action ratified under common law or otherwise, nor shall it create a presumption that any such corporate action is or was a defective corporate action or void or voidable.
(c) In the case of an overissue, putative shares shall be valid shares effective as of the date originally issued or purportedly issued upon: (1) The effectiveness under sections 33-606 to 33-606g, inclusive, and under sections 33-795 to 33-809, inclusive, of an amendment to the certificate of incorporation authorizing, designating or creating such shares; or (2) the effectiveness of any other corporate action under sections 33-606 to 33-606g, inclusive, ratifying the authorization, designation or creation of such shares.
(P.A. 17-108, S. 4.)
Sec. 33-606b. Ratification of defective corporate actions. (a) To ratify a defective corporate action under this section, other than the ratification of an election of the initial board of directors under subsection (b) of this section, the board of directors shall take action ratifying the action in accordance with section 33-606c, stating: (1) The defective corporate action to be ratified and, if the defective corporate action involved the issuance of putative shares, the number and type of putative shares purportedly issued; (2) the date of the defective corporate action; (3) the nature of the failure of authorization with respect to the defective corporate action to be ratified; and (4) that the board of directors approves the ratification of the defective corporate action.
(b) In the event that a defective corporate action to be ratified relates to the election of the initial board of directors of the corporation under subdivision (2) of subsection (a) of section 33-639, a majority of the persons who, at the time of the ratification, are exercising the powers of directors may take an action, stating: (1) The name of the person or persons who first took action in the name of the corporation as the initial board of directors of the corporation; (2) the earlier of the date on which such persons first took such action or were purported to have been elected as the initial board of directors; and (3) that the ratification of the election of such person or persons as the initial board of directors is approved.
(c) If any provision of sections 33-600 to 33-998, inclusive, the certificate of incorporation or bylaws, any corporate resolution or any plan or agreement to which the corporation is a party in effect at the time action under subsection (a) of this section is taken requires shareholder approval or would have required shareholder approval at the date of the defective corporate action, the ratification of the defective corporate action approved in the action taken by the directors under subsection (a) of this section shall be submitted to the shareholders for approval in accordance with section 33-606c.
(d) Unless otherwise provided in the action taken by the board of directors under subsection (a) of this section, after the action by the board of directors has been taken and, if required, approved by the shareholders, the board of directors may abandon the ratification at any time before the validation effective time without further action of the shareholders.
(P.A. 17-108, S. 5.)
Sec. 33-606c. Action on ratification. (a) The quorum and voting requirements applicable to a ratifying action by the board of directors under subsection (a) of section 33-606b shall be the quorum and voting requirements applicable to the corporate action proposed to be ratified at the time such ratifying action is taken.
(b) If the ratification of the defective corporate action requires approval by the shareholders under subsection (c) of section 33-606b, and if the approval is to be given at a meeting, the corporation shall notify each holder of valid and putative shares, regardless of whether entitled to vote, of the record date for notice of the meeting and of the date of the defective corporate action, except that notice shall not be required to be given to holders of valid or putative shares whose identities or addresses for notice cannot be determined from the records of the corporation. The notice must state that the purpose, or one of the purposes, of the meeting is to consider ratification of a defective corporate action and must be accompanied by (1) either a copy of the action taken by the board of directors in accordance with subsection (a) of section 33-606b or the information required by subdivisions (1) to (4), inclusive, of subsection (a) of section 33-606b, and (2) a statement that any claim that the ratification of such defective corporate action and any putative shares issued as a result of such defective corporate action should not be effective, or should be effective only on certain conditions, shall be brought not later than one hundred twenty days after the applicable validation effective time.
(c) Except as provided in subsection (d) of this section with respect to the voting requirements to ratify the election of a director, the quorum and voting requirements applicable to the approval by the shareholders required by subsection (c) of section 33-606b shall be the quorum and voting requirements applicable to the corporate action proposed to be ratified at the time of such shareholder approval.
(d) The approval by shareholders to ratify the election of a director requires that the votes cast within the voting group favoring such ratification exceed the votes cast opposing such ratification of the election at a meeting at which a quorum is present.
(e) Putative shares on the record date for determining the shareholders entitled to vote on any matter submitted to shareholders under subsection (c) of section 33-606b, and without giving effect to any ratification of putative shares that becomes effective as a result of such vote, shall neither be entitled to vote nor counted for quorum purposes in any vote to approve the ratification of any defective corporate action.
(f) If the approval under this section of putative shares would result in an overissue, in addition to the approval required by section 33-606b, approval of an amendment to the certificate of incorporation under sections 33-795 to 33-809, inclusive, to increase the number of shares of an authorized class or series or to authorize the creation of a class or series of shares so there would be no overissue shall also be required.
(P.A. 17-108, S. 6.)
Sec. 33-606d. Notice requirements re action on ratification. (a) Unless shareholder approval is required under subsection (c) of section 33-606b, prompt notice of an action taken under said section shall be given to each holder of valid and putative shares, regardless of whether entitled to vote, as of (1) the date of such action by the board of directors, and (2) the date of the defective corporate action ratified under sections 33-606 to 33-606g, inclusive, provided notice shall not be required to be given to holders of valid and putative shares whose identities or addresses for notice cannot be determined from the records of the corporation.
(b) The notice must contain (1) either a copy of the action taken by the board of directors in accordance with subsection (a) or (b) of section 33-606b, or the information required by subdivisions (1) to (4), inclusive, of subsection (a) of said section or subdivisions (1) to (3), inclusive, of subsection (b) of said section, as applicable, and (2) a statement that any claim that the ratification of the defective corporate action and any putative shares issued as a result of such defective corporate action should not be effective, or should be effective only on certain conditions, shall be brought not later than one hundred twenty days after the applicable validation effective time.
(c) No notice under this section is required with respect to any action required to be submitted to shareholders for approval under subsection (c) of section 33-606b if notice is given in accordance with subsection (b) of section 33-606c.
(d) A notice required by this section may be given in any manner permitted by section 33-603 and, for any corporation subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as from time to time amended, may be given by means of a filing or furnishing of such notice with the United States Securities and Exchange Commission.
(P.A. 17-108, S. 7.)
Sec. 33-606e. Effect of ratification. From and after the validation effective time, and without regard to the one-hundred-twenty-day period during which a claim may be brought under section 33-606g: (1) Each defective corporate action ratified in accordance with section 33-606b shall not be void or voidable as a result of the failure of authorization identified in the action taken under subsection (a) or (b) of said section and shall be deemed a valid corporate action effective as of the date of the defective corporate action; (2) the issuance of each putative share or fraction of a putative share purportedly issued pursuant to a defective corporate action identified in the action taken under section 33-606b shall not be void or voidable, and each such putative share or fraction of a putative share shall be deemed to be an identical share or fraction of a valid share as of the time it was purportedly issued; and (3) any corporate action taken subsequent to the defective corporate action ratified in accordance with sections 33-606 to 33-606g, inclusive, in reliance on such defective corporate action having been validly effected and any subsequent defective corporate action resulting directly or indirectly from such original defective corporate action, shall be valid as of the time taken.
(P.A. 17-108, S. 8.)
Sec. 33-606f. Filings. (a) If the defective corporate action ratified under sections 33-606 to 33-606g, inclusive, would have required under any other provision of sections 33-600 to 33-998, inclusive, a filing in accordance with sections 33-600 to 33-998, inclusive, then, whether or not a filing was previously made in respect to such defective corporate action and in lieu of a filing otherwise required by said sections, the corporation shall file a certificate of validation in accordance with this section, and such certificate of validation shall serve to amend or substitute for any other filing with respect to such defective corporate action required by said sections.
(b) The certificate of validation must set forth: (1) The defective corporate action that is the subject of the certificate of validation including, in the case of any defective corporate action involving the issuance of putative shares, the number and type of putative shares issued and the date or dates upon which such putative shares were purported to have been issued; (2) the date of the defective corporate action; (3) the nature of the failure of authorization in respect of the defective corporate action; (4) a statement that the defective corporate action was ratified in accordance with section 33-606b, including the date on which the board of directors ratified such defective corporate action and the date, if any, on which the shareholders approved the ratification of such defective corporate action; and (5) the information required by subsection (c) of this section.
(c) The certificate of validation must also contain the following information: (1) If a filing was previously made in respect to the defective corporate action and no changes to such filing are required to give effect to the ratification of such defective corporate action in accordance with section 33-606b, the certificate of validation must set forth (A) the name, title and filing date of the filing previously made and any certificate of correction to that filing, and (B) a statement that a copy of the filing previously made, together with any certificate of correction to that filing, is attached as an exhibit to the certificate of validation; (2) if a filing was previously made in respect of the defective corporate action and such filing requires any change to give effect to the ratification of such defective corporate action in accordance with section 33-606b, the certificate of validation must set forth (A) the name, title and filing date of the filing previously made and any certificate of correction to that filing, (B) a statement that a filing containing all of the information required to be included under the applicable provisions of sections 33-600 to 33-998, inclusive, to give effect to such defective corporate action is attached as an exhibit to the certificate of validation, and (C) the date and time that such filing is deemed to have become effective; or (3) if a filing was not previously made in respect of the defective corporate action and the defective corporate action ratified under section 33-606b would have required a filing under any other provision of sections 33-600 to 33-998, inclusive, the certificate of validation must set forth (A) a statement that a filing containing all of the information required to be included under the applicable provision or provisions of sections 33-600 to 33-998, inclusive, to give effect to such defective corporate action is attached as an exhibit to the certificate of validation, and (B) the date and time that such filing is deemed to have become effective.
(P.A. 17-108, S. 9.)
Sec. 33-606g. Judicial proceeding re validity of corporate action. (a) Upon application by the corporation, any successor entity to the corporation, a director of the corporation, any shareholder, beneficial shareholder or unrestricted voting trust beneficial owner of the corporation, including any such shareholder, beneficial shareholder or unrestricted voting trust beneficial owner as of the date of the defective corporate action ratified under section 33-606b, or any other person claiming to be substantially and adversely affected by a ratification under section 33-606b, the Superior Court may (1) determine the validity and effectiveness of any corporate action or defective corporate action; (2) determine the validity and effectiveness of any ratification under section 33-606b; (3) determine the validity of any putative shares; and (4) modify or waive any of the procedures specified in sections 33-606b and 33-606c to ratify a defective corporate action.
(b) In connection with an action under this section, the Superior Court may make such findings or orders, and take into account any factors or considerations, regarding such matters, as it deems proper under the circumstances.
(c) Service of process of the application under subsection (a) of this section on the corporation may be made in any manner provided by any provision of the general statutes or by rule of the applicable court, and no other party need be joined in order for the Superior Court to adjudicate the matter. In an action filed by the corporation, the Superior Court may require notice of the action to be provided to other persons specified by the Superior Court and permit such other persons to intervene in the action.
(d) Notwithstanding any provision of the general statutes, any action asserting that the ratification of any defective corporate action and any putative shares issued as a result of such defective corporate action should not be effective, or should be effective only on certain conditions, shall be brought not later than one hundred twenty days after the validation effective time.
(P.A. 17-108, S. 10.)
Sec. 33-607. Reserved for future use.
Sec. 33-608. Filing requirements. (a) A document shall satisfy the requirements of this section, and of any other section that adds to or varies from these requirements, to be entitled to filing by the Secretary of the State.
(b) Sections 33-600 to 33-998, inclusive, shall require or permit filing the document in the office of the Secretary of the State.
(c) The document shall contain the information required by sections 33-600 to 33-998, inclusive. It may contain other information as well.
(d) The document shall be typewritten or printed or, if electronically transmitted, in a format that can be retrieved or reproduced in typewritten or printed form.
(e) The document shall be in the English language. A corporate name need not be in English if written in English letters or Arabic or Roman numerals, and the certificate of existence required of foreign corporations need not be in English if accompanied by a reasonably authenticated English translation.
(f) The document shall be executed: (1) By the chairman of the board of directors of a domestic or foreign corporation, by its president or by another of its officers; (2) if directors have not been selected or the corporation has not been formed, by an incorporator; or (3) if the corporation is in the hands of a receiver, trustee or other court-appointed fiduciary, by that fiduciary.
(g) The person executing the document shall sign it and state beneath or opposite such person’s signature such person’s name and the capacity in which such person signs. The document may but need not contain a corporate seal, attestation, acknowledgment or verification.
(h) If the Secretary of the State has prescribed a mandatory form for the document under section 33-609, the document shall be in or on the prescribed form.
(i) The document shall be delivered to the office of the Secretary of the State for filing. If the document is filed in typewritten or printed form and not electronically transmitted, the Secretary of the State may require one exact or conformed copy to be delivered with the document, except as provided in sections 33-662 and 33-928.
(j) When the document is delivered to the office of the Secretary of the State for filing, the correct filing fee, and any franchise tax, license fee or penalty required to be paid therewith by sections 33-600 to 33-998, inclusive, or other law must be paid or provision for payment made in a manner permitted by the Secretary of the State.
(k) When any document is required or permitted to be filed or recorded as provided in sections 33-600 to 33-998, inclusive, the Secretary of the State may, in the Secretary of the State’s discretion, for good cause, permit a photostatic or other photographic copy of such document to be filed or recorded in lieu of the original instrument. Such filing or recording shall have the same force and effect as if the original instrument had been so filed or recorded.
(l) As used in this subsection, “filed document” means a document filed with the Secretary of the State under any provision of sections 33-600 to 33-998, inclusive, except sections 33-920 to 33-937, inclusive, and section 33-953, and “plan” means a plan of merger, plan of share exchange or plan of division, as described in section 38a-156s. Whenever a provision of sections 33-600 to 33-998, inclusive, or section 38a-156s permits any of the terms of a plan or filed document to be dependent on facts objectively ascertainable outside the plan or filed document, the following provisions apply:
(1) The manner in which the facts will operate upon the terms of the plan or filed document shall be set forth in the plan or filed document;
(2) The facts may include, but are not limited to (A) any of the following that is available in a nationally recognized news or information medium either in print or electronically: Statistical or market indices, market prices of any security or group of securities, interest rates, currency exchange rates, or similar economic or financial data, (B) a determination or action by any person or body, including the corporation or any other party to a plan or filed document, or (C) the terms of, or actions taken under, an agreement to which the corporation is a party, or any other agreement or document;
(3) The following provisions of a plan or filed document may not be made dependent on facts outside the plan or filed document: (A) The name and address of any person required in a filed document; (B) the registered office of any entity required in a filed document; (C) the registered agent of any entity required in a filed document; (D) the number of authorized shares and designation of each class or series of shares; (E) the effective date of a filed document; and (F) any required statement in a filed document of the date on which the underlying transaction was approved or the manner in which such approval was given; and
(4) If a provision of a filed document is made dependent on a fact ascertainable outside of the filed document, and such fact is not ascertainable by reference to a source described in subparagraph (A) of subdivision (2) of this subsection or a document that is a matter of public record, or the affected shareholders have not received notice of the fact from the corporation, then the corporation shall file with the Secretary of the State a certificate of amendment setting forth the fact promptly after the time when the fact referred to is first ascertainable or thereafter changes. Certificates of amendment under this subdivision are deemed to be authorized by the authorization of the original plan or filed document to which they relate and may be filed by the corporation without further action by the board of directors or the shareholders.
(m) The Secretary of the State may require or permit the filing by electronic transmission or by employing new technology as it is developed of any document that is required by law or regulation under sections 33-600 to 33-998, inclusive, to be filed with the Secretary of the State.
(P.A. 94-186, S. 4, 215; P.A. 96-271, S. 4, 254; P.A. 98-137, S. 50, 51, 62; 98-219, S. 33, 34; P.A. 01-199, S. 5; P.A. 03-158, S. 4; P.A. 11-146, S. 1; P.A. 17-2, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (i) to delete the exception for when the document is transmitted by electronic means, effective January 1, 1997; P.A. 98-137 amended Subsecs. (d) and (g) to replace “transmitted by electronic means” with “electronically transmitted”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 01-199 amended Subsec. (d) to replace “or, if authorized by the Secretary of the State, electronically transmitted” with “or, if electronically transmitted, in a format that can be retrieved or reproduced in typewritten or printed form”, amended Subsec. (g) to make the manner of executing a document the same whether it is typewritten or printed or electronically transmitted by deleting provision that required the person executing a document that is electronically transmitted to “affirm and authenticate the execution of the document in such manner as the Secretary of the State may prescribe as effective for those purposes”, replace provision authorizing the document to contain “(1) The corporate seal, (2) an attestation by the secretary or an assistant secretary, (3) an acknowledgment, verification or proof” with “a corporate seal, attestation, acknowledgment or verification” and make technical changes for purposes of gender neutrality, amended Subsec. (i) to authorize delivery by electronic transmission if and to the extent permitted by the Secretary of the State and authorize the Secretary of the State to require one exact or conformed copy of a filed document that is in typewritten or printed form and not electronically transmitted to be delivered with the document, amended Subsec. (j) to rephrase provisions and amended Subsec. (k) to make a technical change for purposes of gender neutrality; P.A. 03-158 added Subsec. (l) re terms and provisions of plan or filed document to be dependent on facts objectively ascertainable outside the plan or filed document; P.A. 11-146 amended Subsec. (i) to delete provision authorizing delivery by electronic transmission if and to extent permitted by Secretary of the State and added new Subsec. (m) re authority of Secretary of the State to require or permit filing by electronic transmission or by employing new technology as it is developed of any document required to be filed with said Secretary, effective January 1, 2012; P.A. 17-2 amended Subsec. (l) by redefining “plan” and adding “or section 38a-156s”.
Sec. 33-609. Forms. Mailing address. (a) The Secretary of the State may prescribe and furnish on request forms for: (1) An application for a certificate of existence; (2) a foreign corporation’s application for a certificate of authority to transact business in this state; (3) a foreign corporation’s application for a certificate of withdrawal; and (4) the annual report. If the Secretary of the State so requires, use of these forms is mandatory.
(b) The Secretary of the State may prescribe and furnish on request forms for other documents required or permitted to be filed by sections 33-600 to 33-998, inclusive, but their use is not mandatory.
(c) If a corporation or a foreign corporation so requests in writing, the Secretary of the State shall mail to the address designated in such request, and to no other address of the corporation, all matter required or permitted by this chapter to be mailed to such corporation or foreign corporation by the Secretary of the State.
(P.A. 94-186, S. 5, 215; P.A. 97-246, S. 3, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 added new Subsec. (c) re mailing of all matter to address designated by corporation, effective June 27, 1997.
Sec. 33-610. Effective time and date of document. (a) Except as provided in subsection (b) of this section and subsection (c) of section 33-611, a document accepted for filing is effective: (1) At the date and time of filing, as evidenced by such means as the Secretary of the State may use for the purpose of recording the date and time of filing; or (2) at the time specified in the document as its effective time on the date it is filed.
(b) A document, other than the certificate of incorporation of a domestic corporation or a certificate of authority of a foreign corporation, may specify a delayed effective time and date, and if it does so the document becomes effective at the time and date specified. If a delayed effective date but no time is specified, the document is effective at the close of business on that date.
(P.A. 94-186, S. 7, 215; P.A. 96-271, S. 5, 254; P.A. 98-137, S. 52, 62; 98-219, S. 33, 34; P.A. 01-199, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to delete provision excluding “the articles of incorporation of a domestic incorporation or a certificate of authority of a foreign corporation” and amended Subsec. (b) to add provision excluding “the certificate of incorporation of a domestic corporation or a certificate of authority of a foreign corporation”, effective January 1, 1997; P.A. 98-137 amended Subsec. (a) to replace “transmitted by electronic means” with “electronically transmitted”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 01-199 amended Subsec. (a)(1) to provide that a document is effective “At the date and time of filing, as evidenced by such means as the Secretary of the State may use for the purpose of recording the date and time of filing” rather than “At the time of filing on the date it is filed, as evidenced by the Secretary of the State’s date and time endorsement on the original document or, when the document is electronically transmitted, as evidenced by electronic means prescribed by the Secretary of the State for the purpose of recording electronically the date and time of filing”.
Sec. 33-611. Correcting filed document. (a) A domestic or foreign corporation may correct a document filed by the Secretary of the State if (1) the document contains an inaccuracy, (2) the document was defectively made, executed, attested, sealed, verified or acknowledged, or (3) the electronic transmission was defective.
(b) A document is corrected: (1) By preparing a certificate of correction that (A) describes the document, including its filing date, or attaches a copy of it to the certificate, (B) specifies the inaccuracy or defect to be corrected, and (C) corrects the inaccuracy or defect; and (2) by delivering the certificate to the Secretary of the State for filing.
(c) A certificate of correction is effective on the effective date of the document it corrects except as to persons relying on the uncorrected document and adversely affected by the correction. As to those persons, a certificate of correction is effective when filed.
(P.A. 94-186, S. 8, 215; P.A. 96-271, S. 6, 7, 254; P.A. 01-199, S. 7; P.A. 03-18, S. 3.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of correction with “certificate” of correction in Subsecs. (b) and (c), effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to make technical changes, replace “an incorrect statement” with “an inaccuracy” and add new Subdiv. (3) authorizing correction if the electronic transmission was defective and amended Subsec. (b)(1)(B) to replace “the incorrect statement and the reason it is incorrect or the manner in which the execution was defective” with “the inaccuracy or defect to be corrected” and Subsec. (b)(1)(C) to replace “the incorrect statement or defective execution” with “the inaccuracy or defect”; P.A. 03-18 amended Subsec. (a)(2) to add reference to document defectively made, effective July 1, 2003.
Sec. 33-612. Filing duty of Secretary of the State. (a) If a document delivered to the office of the Secretary of the State for filing satisfies the requirements of section 33-608, the Secretary of the State shall file it.
(b) The Secretary of the State files a document by stamping or otherwise endorsing “Filed”, together with his name and official title and the date and time of receipt on the original and on the receipt for the filing fee. After filing a document, except as provided in sections 33-662 and 33-928, the Secretary of the State shall deliver evidence of filing of such document and of payment of any required fee to the domestic or foreign corporation or its representative.
(c) If the Secretary of the State refuses to file a document, he shall return it to the domestic or foreign corporation or its representative within five days after the document was delivered, together with a brief written explanation of the reason for his refusal.
(d) The Secretary of the State’s duty to file documents under this section is ministerial. His filing or refusing to file a document does not: (1) Affect the validity or invalidity of the document in whole or in part; (2) relate to the correctness or incorrectness of information contained in the document; or (3) create a presumption that the document is valid or invalid or that information contained in the document is correct or incorrect.
(P.A. 94-186, S. 9, 215; P.A. 96-271, S. 8, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace reference to Sec. 33-929 with Sec. 33-928, effective January 1, 1997.
Sec. 33-613. Appeal from Secretary of the State’s refusal to file document. (a) If the Secretary of the State refuses to file a document delivered to his office for filing, the domestic or foreign corporation may appeal the refusal within thirty days after the return of the document to the superior court for the judicial district of Hartford. The appeal is commenced by petitioning the court to compel filing the document and by attaching to the petition the document and the Secretary of the State’s explanation of his refusal to file.
(b) The court may summarily order the Secretary of the State to file the document or take other action the court considers appropriate.
(c) The court’s final decision may be appealed as in other civil proceedings.
(P.A. 88-230, S. 1, 2; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; P.A. 94-186, S. 10, 215; P.A. 95-220, S. 4–6.)
History: P.A. 94-186 effective January 1, 1997. (Revisor’s note: P.A. 88-230, P.A. 90-98 and P.A. 93-142 authorized substitution of “judicial district of Hartford” for “judicial district of Hartford-New Britain” in public and special acts of the 1994 regular and special sessions, effective September 1, 1996); P.A. 95-220 changed the effective date of P.A. 88-230 from September 1, 1996, to September 1, 1998, effective July 1, 1995.
Sec. 33-614. Evidentiary effect of copy of filed document. A copy of a document filed by the Secretary of the State, which copy is certified by the Secretary of the State, bearing his signature, which may be a facsimile, and the seal of this state, is conclusive evidence that the original document is on file with the Secretary of the State.
(P.A. 94-186, S. 11, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-615. Certificate of existence or authorization. (a) Any person may apply to the Secretary of the State to furnish a certificate of existence for a domestic corporation or a certificate of authorization for a foreign corporation.
(b) The issuance of a certificate of existence or authorization shall be conclusive evidence that such corporation’s most recent annual report required by section 33-953 has been delivered to the Secretary of the State and that a certificate of dissolution or a certificate of withdrawal has not been filed with respect to such corporation.
(P.A. 94-186, S. 12, 215; P.A 96-271, S. 9, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to delete provision requiring a certificate of existence or authorization to “set forth the information provided in subdivisions (3) and (4) of subsection (b) of section 33-617”, replace “articles of dissolution” with “a certificate of dissolution” and add reference to “a certificate of withdrawal”, effective January 1, 1997.
Sec. 33-616. Penalty for signing false document. A person who signs or otherwise executes a document he knows is false in any material respect with intent that the document be delivered to the Secretary of the State for filing shall be subject to the penalty for false statement under section 53a-157b.
(P.A. 94-186, S. 13, 215; P.A. 96-180, S. 108, 166.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-180 made technical change by correcting statutory reference, effective June 3, 1996.
Sec. 33-617. Fees payable to Secretary of the State. (a) The Secretary of the State shall charge and collect the following fees for filing documents and issuing certificates and remit them to the Treasurer for the use of the state: (1) Filing application to reserve, register, renew or cancel registration of corporate name, sixty dollars; (2) filing transfer of reserved corporate name, sixty dollars; (3) filing certificate of incorporation, including appointment of registered agent, one hundred dollars; (4) filing change of address of registered agent or change of registered agent, fifty dollars; (5) filing notice of resignation of registered agent, fifty dollars; (6) filing amendment to certificate of incorporation, one hundred dollars; (7) filing restated certificate of incorporation, one hundred dollars; (8) filing certificate of merger or share exchange, sixty dollars; (9) filing certificate of correction, one hundred dollars; (10) filing certificate of surrender of special charter and adoption of general certificate of incorporation, one hundred dollars; (11) filing certificate of revocation of dissolution, fifty dollars; (12) filing annual report, one hundred fifty dollars except as otherwise provided in sections 33-953 and 33-954; (13) filing application of foreign corporation for certificate of authority to transact business in this state and issuing certificate of authority, one hundred dollars; (14) filing application of foreign corporation for amended certificate of authority to transact business in this state and issuing amended certificate of authority, one hundred dollars; (15) filing application for reinstatement, one hundred fifty dollars; (16) filing a corrected annual report, one hundred dollars; and (17) filing an interim notice of change of director or officer, twenty dollars.
(b) The Secretary of the State shall charge and collect the following miscellaneous charges and remit them to the Treasurer for the use of the state: (1) At the time of any service of process on the Secretary of the State as registered agent of a corporation, which amount may be recovered as taxable costs by the party to the suit or action causing such service to be made if such party prevails in the suit or action, the plaintiff in the process so served shall pay fifty dollars; (2) for preparing and furnishing a copy of any document, instrument or paper filed or recorded relating to a corporation: For each copy of each such document thereof regardless of the number of pages, forty dollars; for affixing his certification and official seal thereto, fifteen dollars; (3) for preparing and furnishing his certificate of existence or authorization, which certificate may reflect any and all changes of corporate names and the date or dates of filing thereof, eighty dollars; (4) for preparing and furnishing his certificate of existence or authorization reflecting certificates effecting fundamental changes to a certificate of incorporation and the date or dates of filing thereof, one hundred twenty dollars; and (5) for other services for which fees are not provided by the general statutes, the Secretary of the State may charge such fees as will in his judgment cover the cost of the services provided.
(c) The tax imposed under chapter 219 shall not be imposed upon any transaction for which a fee is charged under the provisions of this section.
(d) Each foreign corporation shall pay to the Secretary of the State a license fee of two hundred eighty-five dollars at the time of filing its application for a certificate of authority to transact business in this state, and annually thereafter on or before the last day of the calendar month in which falls the anniversary of the day of issuance of its certificate of authority, until such time as it has filed a certificate of withdrawal from the state or its certificate of authority to transact business in this state has been revoked.
(e) The Secretary of the State shall proceed as provided in section 33-935 whenever a foreign corporation is in default in payment of its license fees as therein provided.
(P.A. 94-186, S. 6, 215; P.A. 96-271, S. 10, 11, 254; P.A. 98-137, S. 12, 62; 98-219, S. 33, 34; June Sp. Sess. P.A. 09-3, S. 370; P.A. 14-154, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles of incorporation” with “certificate of incorporation” and “statutory agent” with “registered agent” where appearing, include application to “cancel” registration of corporate name in Subdiv. (1), replace “articles of merger or share exchange” with “certificate of merger or share exchange” in Subdiv. (8), replace “articles of correction” with “certificate of correction” in Subdiv. (9), replace “articles of dissolution” with “certificate of dissolution” in Subdiv. (11), replace “articles of revocation of dissolution” with “certificate of revocation of dissolution” in Subdiv. (12) and delete Subdiv. (13) re fee for filing certificate of administrative dissolution, renumbering the remaining Subdivs. accordingly, and amended Subsec. (b) to replace “statutory agent” with “registered agent” in Subdiv. (1) and delete incorrect statutory references in Subdivs. (3) and (4), effective January 1, 1997; P.A. 98-137 added Subsec. (a)(19) re $10 fee for filing an interim notice of change of director or officer, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; June Sp. Sess. P.A. 09-3 increased fees in Subsecs. (a), (b) and (d); P.A. 14-154 amended Subsec. (a) by deleting former Subdiv. (11) re filing fee for certificate of dissolution, redesignating existing Subdivs. (12) to (15) as Subdivs. (11) to (14), deleting former Subdiv. (16) re filing fee for application for and issuance of certificate of withdrawal of foreign corporation and redesignating existing Subdivs. (17) to (19) as Subdivs. (15) to (17), effective July 1, 2015.
Sec. 33-618. Franchise tax. (a) A corporation shall pay, and the Secretary of the State shall charge and collect from such corporation, a franchise tax, based upon the number of shares which it will have authority to issue or the increase in the number of shares which it will have authority to issue, whenever it: (1) Files a certificate of incorporation; (2) files a certificate of amendment increasing the number of authorized shares; (3) files a certificate of merger increasing the number of authorized shares which a surviving or new domestic corporation will have authority to issue above the aggregate number of shares which the merging domestic corporations had authority to issue; or (4) files a certificate of correction increasing the number of authorized shares which the corporation will have authority to issue. The franchise tax payable on an increase in the number of authorized shares shall be imposed only on the increased number of such shares. A specially chartered corporation which shall reincorporate under sections 33-600 to 33-998, inclusive, as provided in section 33-913 shall be taxed only to the extent, if any, by which the number of its authorized shares shall thereby be increased.
(b) The franchise tax shall be at the rate of one cent per share up to and including the first ten thousand authorized shares, one-half cent per share for each authorized share in excess of ten thousand shares up to and including one hundred thousand shares, one-quarter cent per share for each authorized share in excess of one hundred thousand shares up to and including one million shares and one-fifth cent per share for each authorized share in excess of one million shares.
(c) In no case shall any franchise tax payment upon the filing of a certificate of incorporation be less than one hundred fifty dollars.
(d) The taxes imposed by this section shall not apply to the authorization, issuance, transfer or exchange of stock or securities to make effective any plan of corporate reorganization or adjustment confirmed or approved as provided in subdivision (1), (2) or (3) of this subsection, provided the authorization, issuance, transfer or exchange of such stock or securities occurs within five years from the date of such confirmation or approval: (1) Confirmed under the Bankruptcy Act, 30 Stat. 544, USC Title 11, as amended, or the Bankruptcy Code, 92 Stat. 2549-2688, USC Title 11, as amended; (2) approved in an equity receivership proceeding in a court involving a railroad as defined in Section 101(33) of the Bankruptcy Code, as amended, 92 Stat. 2553, 11 USC 101(33); (3) approved in an equity receivership proceeding in a court involving a corporation, as defined in Section 101(8) of the Bankruptcy Code, as amended, 92 Stat. 2550, 11 USC 101(8).
(P.A. 94-186, S. 16, 215; P.A. 96-271, S. 12, 13, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” with “a certificate” where appearing and deleted Subsec. (d)(4) re approval in an equity receivership proceeding in a court involving a corporation undergoing insolvency proceedings under chapter 784, effective January 1, 1997.
Secs. 33-619 to 33-621. Reserved for future use.
Sec. 33-622. Powers of Secretary of the State. The Secretary of the State has the power reasonably necessary to perform the duties required of him by sections 33-600 to 33-998, inclusive.
(P.A. 94-186, S. 14, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-623. Regulations regarding electronic filing. The Secretary of the State may adopt regulations in accordance with the provisions of chapter 54 governing the filing with and delivery of documents to the office of the Secretary of the State under sections 33-600 to 33-998, inclusive, by electronic means, including facsimile and computer transmission.
(P.A. 94-186, S. 15, 215; P.A. 96-271, S. 14, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 specified that the regulations govern documents filed “with” and delivered “to the Office of the Secretary of the State”, effective January 1, 1997.
Sec. 33-624. Interrogatories by Secretary of the State. (a) The Secretary of the State may propound to any corporation subject to the provisions of sections 33-600 to 33-998, inclusive, domestic or foreign, and to any officer or director thereof, such interrogatories as may be reasonably necessary and proper to enable him to ascertain whether such corporation has complied with the provisions of said sections applicable to such corporation. Such interrogatories shall be answered within thirty days after the mailing thereof, or within such additional time as shall be fixed by the Secretary of the State, and the answers thereto shall be full and complete and shall be made in writing and under oath. If such interrogatories are directed to an individual they shall be answered by him, and, if directed to a corporation, they shall be answered by the president, vice president, secretary or assistant secretary thereof.
(b) Each corporation, domestic or foreign, and each officer and director of a corporation, domestic or foreign, failing or refusing within the time prescribed by this section to answer truthfully and fully interrogatories duly propounded to it or him by the Secretary of the State as provided in subsection (a) of this section shall be fined not more than five hundred dollars.
(c) Interrogatories propounded by the Secretary of the State and the answers thereto shall not be opened to public inspection nor shall the Secretary of the State disclose any facts or information obtained therefrom except insofar as his official duty may require the same to be made public or if such interrogatories or the answers thereto are required for evidence in any criminal proceedings or in any other action by this state.
(P.A. 94-186, S. 2, 215.)
History: P.A. 94-186 effective January 1, 1997.
Secs. 33-625 to 33-634. Reserved for future use.
PART II
INCORPORATION
Sec. 33-635. Incorporators. One or more persons may act as the incorporator or incorporators of a corporation by delivering a certificate of incorporation to the Secretary of the State for filing.
(P.A. 94-186, S. 20, 215; P.A. 96-271, S. 15, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “a certificate” of incorporation, effective January 1, 1997.
Sec. 33-636. Certificate of incorporation. (a) The certificate of incorporation shall set forth: (1) A corporate name for the corporation that satisfies the requirements of section 33-655; (2) the number of shares the corporation is authorized to issue; (3) the street and mailing address of the corporation’s initial registered office and the name of its initial registered agent at that office; and (4) the name and address of each incorporator.
(b) The certificate of incorporation may set forth: (1) The names and addresses of the individuals who are to serve as the initial directors; (2) provisions not inconsistent with law regarding: (A) The purpose or purposes for which the corporation is organized; (B) managing the business and regulating the affairs of the corporation; (C) defining, limiting and regulating the powers of the corporation, its board of directors and shareholders; (D) a par value for authorized shares or classes of shares; or (E) the imposition of personal liability on shareholders for the debts of the corporation to a specified extent and upon specified conditions; (3) any provision that under sections 33-600 to 33-998, inclusive, is required or permitted to be set forth in the bylaws; (4) a provision limiting the personal liability of a director to the corporation or its shareholders for money damages for breach of duty as a director to an amount that is not less than the compensation received by the director for serving the corporation during the year of the violation if such breach did not (A) involve a knowing and culpable violation of law by the director, (B) enable the director or an associate, as defined in section 33-840, to receive an improper personal economic gain, (C) show a lack of good faith and a conscious disregard for the duty of the director to the corporation under circumstances in which the director was aware that his conduct or omission created an unjustifiable risk of serious injury to the corporation, (D) constitute a sustained and unexcused pattern of inattention that amounted to an abdication of the director’s duty to the corporation, or (E) create liability under section 33-757, provided no such provision shall limit or preclude the liability of a director for any act or omission occurring prior to the effective date of such provision; (5) a provision permitting or making obligatory indemnification of a director for liability, as defined in section 33-770, to any person for any action taken, or any failure to take any action, as a director, except liability that (A) involved a knowing and culpable violation of law by the director, (B) enabled the director or an associate, as defined in section 33-840, to receive an improper personal gain, (C) showed a lack of good faith and a conscious disregard for the duty of the director to the corporation under circumstances in which the director was aware that his conduct or omission created an unjustifiable risk of serious injury to the corporation, (D) constituted a sustained and unexcused pattern of inattention that amounted to an abdication of the director’s duty to the corporation, or (E) created liability under section 33-757, provided no such provision shall affect the indemnification of or advance of expenses to a director for any liability stemming from acts or omissions occurring prior to the effective date of such provision; and (6) a provision limiting or eliminating any duty of a director or any other person to offer the corporation the right to have or participate in any, or one or more classes or categories of, business opportunities, before the pursuit or taking of the opportunity by the director or other person; provided that any application of such a provision to an officer or a related person of that officer (A) also requires approval of that application by the board of directors, subsequent to the effective date of the provision, by action of qualified directors taken in compliance with the same procedures as are set forth in section 33-783, and (B) may be limited by the authorizing action of the board. As used in this subsection “related person” has the same meaning as provided in section 33-781.
(c) The certificate of incorporation need not set forth any of the corporate powers enumerated in sections 33-600 to 33-998, inclusive.
(d) Provisions of the certificate of incorporation may be made dependent upon facts objectively ascertainable outside the certificate of incorporation in accordance with subsection (l) of section 33-608.
(P.A. 94-186, S. 21, 215; P.A. 96-271, S. 16, 254; P.A. 97-246, S. 4, 99; P.A. 03-158, S. 5; P.A. 06-68, S. 27; P.A. 17-108, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 97-246 amended Subsec. (b)(4) to make a technical change and added Subsec. (b)(5) authorizing a provision re indemnification of a director, effective June 27, 1997; P.A. 03-158 added Subsec. (d) re provisions dependent upon facts objectively ascertainable outside the certificate of incorporation; P.A. 06-68 made a technical change in Subsec. (b)(5); P.A. 17-108 amended Subsec. (a)(3) by replacing “street address” with “street and mailing address”, and amended Subsec. (b) by adding Subdiv. (6) re provision limiting or eliminating duty of director or other person to offer corporation right to have or participate in classes of business opportunities before pursuit or taking of opportunity by director or other person, and making technical changes.
Sec. 33-637. Incorporation. (a) The corporate existence begins when the certificate of incorporation is filed.
(b) The Secretary of the State’s filing of the certificate of incorporation is conclusive proof that the incorporators satisfied all conditions precedent to incorporation except in a proceeding by the state to cancel or revoke the incorporation or involuntarily dissolve the corporation.
(P.A. 94-186, S. 22, 215; P.A. 96-271, S. 17, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (a) to delete exception when a delayed effective date is specified, effective January 1, 1997.
Sec. 33-638. Liability for preincorporation transactions. All persons purporting to act as or on behalf of a corporation, knowing there was no incorporation under sections 33-600 to 33-998, inclusive, are jointly and severally liable for all liabilities created while so acting.
(P.A. 94-186, S. 23, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-639. Organization of corporation. (a) After incorporation: (1) If initial directors are named in the certificate of incorporation, the initial directors shall hold an organizational meeting, at the call of a majority of the directors, to complete the organization of the corporation by appointing officers, adopting bylaws and carrying on any other business brought before the meeting; (2) if initial directors are not named in the certificate, the incorporator or incorporators shall hold an organizational meeting at the call of a majority of the incorporators: (A) To elect directors and complete the organization of the corporation; or (B) to elect a board of directors who shall complete the organization of the corporation.
(b) Action required or permitted by sections 33-600 to 33-998, inclusive, to be taken by incorporators at an organizational meeting may be taken without a meeting if the action taken is evidenced by one or more written consents describing the action taken and signed by each incorporator.
(c) An organizational meeting may be held in or out of this state.
(d) An organizational meeting held before incorporation is valid as if it were held after incorporation if the persons holding the meeting could properly have held such meeting after incorporation.
(P.A. 94-186, S. 24, 215; P.A. 96-271, S. 18, 254; P.A. 97-246, S. 5, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 97-246 added new Subsec. (d) re validity of organizational meeting held before incorporation, effective June 27, 1997.
Sec. 33-640. Bylaws. (a) The incorporators or board of directors of a corporation shall adopt initial bylaws for the corporation.
(b) The bylaws of a corporation may contain any provision that is not inconsistent with law or the certificate of incorporation.
(c) The bylaws may contain one or both of the following provisions:
(1) A requirement that if the corporation solicits proxies or consents with respect to an election of directors, the corporation include in its proxy statement and any form of its proxy or consent, to the extent and subject to such procedures or conditions as are provided in the bylaws, one or more individuals nominated by a shareholder in addition to individuals nominated by the board of directors; and
(2) A requirement that the corporation reimburse the expenses incurred by a shareholder in soliciting proxies or consents in connection with an election of directors, to the extent and subject to such procedures or conditions as are provided in the bylaws, provided that no bylaw so adopted shall apply to elections for which any record date precedes its adoption.
(d) Notwithstanding subdivision (2) of subsection (b) of section 33-806, the shareholders in amending, repealing or adopting a bylaw described in subsection (c) of this section may not limit the authority of the board of directors to amend or repeal any condition or procedure set forth in or to add any procedure or condition to such a bylaw in order to provide for a reasonable, practicable and orderly process.
(P.A. 94-186, S. 25, 215; P.A. 96-271, S. 19, 254; P.A. 12-32, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 12-32 amended Subsec. (b) to delete “for managing the business and regulating the affairs of the corporation”, added Subsec. (c) re bylaw provisions concerning solicitation of proxies or consents and added Subsec. (d) re prohibition on limiting authority of board re bylaw described in Subsec. (c).
Sec. 33-641. Emergency bylaws. (a) Unless the certificate of incorporation provides otherwise, the board of directors of a corporation may adopt bylaws to be effective only in an emergency defined in subsection (d) of this section. The emergency bylaws, which are subject to amendment or repeal by the shareholders, may make all provisions necessary for managing the corporation during the emergency, including: (1) Procedures for calling a meeting of the board of directors; (2) quorum requirements for the meeting; and (3) designation of additional or substitute directors.
(b) All provisions of the regular bylaws consistent with the emergency bylaws remain effective during the emergency. The emergency bylaws are not effective after the emergency ends.
(c) Corporate action taken in good faith in accordance with the emergency bylaws: (1) Binds the corporation; and (2) may not be used to impose liability on a corporate director, officer, employee or agent.
(d) An emergency exists for purposes of this section if a quorum of the corporation’s directors cannot readily be assembled because of some catastrophic event.
(P.A. 94-186, S. 26, 215; P.A. 96-271, S. 20, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-642. Certificate of incorporation or bylaws may require that internal corporate claims be brought in specified courts. (a) The certificate of incorporation or the bylaws of a corporation may require that any or all internal corporate claims be brought exclusively in any specified court or courts of this state and, if so specified, in any additional courts in this state or in any other jurisdictions with which the corporation has a reasonable relationship.
(b) A provision of the certificate of incorporation or the bylaws adopted under subsection (a) of this section shall not have the effect of conferring jurisdiction on any court or over any person or claim, and shall not apply if none of the courts specified by such provision have the requisite personal and subject matter jurisdiction. If the court or courts of this state specified in a provision adopted under subsection (a) of this section do not have the requisite personal and subject matter jurisdiction and another court of this state does have such jurisdiction, then the internal corporate claim may be brought in such other court of this state, notwithstanding that such other court of this state is not specified in such provision, and in any other court specified in such provision that has the requisite jurisdiction.
(c) No provision of the certificate of incorporation or the bylaws may prohibit bringing an internal corporate claim in the courts of this state or require such claims to be determined by arbitration.
(d) As used in this section, “internal corporate claim” means, (1) any claim that is based upon a violation of a duty under the laws of this state by a current or former director, officer or shareholder in such capacity, (2) any derivative action or proceeding brought on behalf of the corporation, (3) any action asserting a claim arising pursuant to any provision of sections 33-600 to 33-998, inclusive, or the certificate of incorporation or bylaws, or (4) any action asserting a claim governed by the internal affairs doctrine that is not included in subdivisions (1) to (3), inclusive, of this subsection.
(P.A. 17-108, S. 20.)
Secs. 33-643 and 33-644. Reserved for future use.
PART III
PURPOSES AND POWERS
Sec. 33-645. Purposes. (a) Every corporation incorporated under sections 33-600 to 33-998, inclusive, has the purpose of engaging in any lawful business except that of a bank and trust company, savings bank or savings and loan association, unless a more limited purpose is set forth in the certificate of incorporation.
(b) No corporation formed under sections 33-600 to 33-998, inclusive, shall have power to transact in this state the business of a gas, electric distribution or water company, or cemetery corporation, or of any company, except a telephone company, requiring the right to take and condemn lands or to occupy the public highways of this state.
(c) No corporation may be formed under sections 33-600 to 33-998, inclusive, for the purpose of transacting the business of an insurance company or a surety or indemnity company, unless at the time of the filing of its certificate of incorporation, there is also filed a certificate issued by the Insurance Commissioner pursuant to section 33-646 authorizing the formation of the corporation. No corporation formed under sections 33-600 to 33-998, inclusive, shall have power to transact in this state the business of an insurance company or a surety or indemnity company until it has procured a license from the Insurance Commissioner in accordance with the provisions of section 38a-41.
(d) Nothing in sections 33-600 to 33-998, inclusive, shall be construed to authorize a corporation formed under said sections to transact any business except in compliance with any laws of this state regulating or otherwise applying to the same. The provisions of said sections shall govern all corporations, but notwithstanding the provisions of said sections, where by law special provisions are made in the case of a designated class or classes of corporations governing the corporate procedure thereof in any respect, limiting or extending the powers thereof, conditioning action upon the approval of any agency of the state, or otherwise prescribing the conduct of such corporations, such procedure, powers, action and conduct shall be governed by such special provisions whether or not such corporations are formed under said sections.
(e) Nothing in this section shall prohibit the formation of a corporation under sections 33-600 to 33-998, inclusive, for the transaction of any business or for the promotion of any purpose in any other state if not prohibited by the laws thereof.
(P.A. 94-186, S. 27, 215; P.A. 96-106, S. 4, 5; 96-271, S. 21, 22, 254; P.A. 98-28, S. 107, 117; P.A. 14-134, S. 38.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-106 amended Subsec. (c) to delete the exception for affiliates of previously-chartered insurance companies, effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (a) to replace “state bank and trust company” with “bank and trust company” and replace “building and loan association” with “savings and loan association”, effective January 1, 1997; P.A. 98-28 amended Subsec. (b) by adding electric distribution companies, effective July 1, 1998; P.A. 14-134 amended Subsec. (b) to delete references to telegraph company and electric company, effective June 6, 2014.
Under former Sec. 16-286(b), domestic corporation not transacting business as electric light company where sale of electricity does not require use of public highways or condemnation of land. 243 C. 635.
Sec. 33-646. Authorization to form corporation to transact insurance business. (a) A certificate authorizing the formation of a corporation to transact the business of an insurance company shall be issued by the Insurance Commissioner if the following is submitted to him by the incorporators and is deemed to be satisfactory: (1) The proposed certificate of incorporation, which shall state that the corporation has, as a purpose, the doing of an insurance business; (2) the proposed bylaws of the corporation; and (3) such information as the commissioner shall require to evaluate the objectives, management and control of the proposed corporation.
(b) All expenses incurred by the commissioner in connection with proceedings under this section shall be paid by the person filing the application.
(P.A. 94-186, S. 28, 215; P.A. 96-271, S. 23, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-647. General powers. Unless its certificate of incorporation provides otherwise, every corporation has perpetual duration and succession in its corporate name and has the same powers as an individual to do all things necessary or convenient to carry out its business and affairs, including without limitation power:
(1) To sue and be sued, complain and defend in its corporate name;
(2) To have a corporate seal, which may be altered at will, and to use it, or a facsimile of it, by impressing or affixing it or in any other manner reproducing it;
(3) To make and amend bylaws, not inconsistent with its certificate of incorporation or with the laws of this state, for managing the business and regulating the affairs of the corporation;
(4) To purchase, receive, lease or otherwise acquire, and own, hold, improve, use and otherwise deal with, real or personal property, or any legal or equitable interest in property, wherever located;
(5) To sell, convey, mortgage, pledge, lease, exchange and otherwise dispose of all or any part of its property;
(6) To purchase, receive, subscribe for or otherwise acquire, own, hold, vote, use, sell, mortgage, lend, pledge or otherwise dispose of, and deal in and with shares or other interests in, or obligations of, any other entity;
(7) To make contracts and guarantees, incur liabilities, borrow money, issue its notes, bonds and other obligations, which may be convertible into or include the option to purchase other securities of the corporation, and secure any of its obligations by mortgage or pledge of any of its property, franchises or income;
(8) To lend money, invest and reinvest its funds, and receive and hold real and personal property as security for repayment;
(9) To be a promoter, partner, member, associate or manager of any partnership, joint venture, trust or other entity;
(10) To conduct its business, locate offices and exercise the powers granted by sections 33-600 to 33-998, inclusive, within or without this state;
(11) To elect directors and appoint officers, employees and agents of the corporation, define their duties, fix their compensation and lend them money and credit;
(12) To pay pensions and establish pension plans, pension trusts, profit-sharing plans, share bonus plans, share option plans and benefit or incentive plans for any or all of its current or former directors, officers, employees and agents;
(13) To make donations for the public welfare or for charitable, scientific or educational purposes;
(14) To transact any lawful business that will aid government policy; and
(15) To make payments or donations, or do any other act, not inconsistent with law, that furthers the business and affairs of the corporation.
(P.A. 94-186, S. 29, 215; P.A. 96-271, S. 24, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
Sec. 33-648. Emergency powers. (a) In anticipation of or during an emergency defined in subsection (d) of this section, the board of directors of a corporation may: (1) Modify lines of succession to accommodate the incapacity of any director, officer, employee or agent; and (2) relocate the principal office, designate alternative principal offices or regional offices, or authorize the officers to do so.
(b) During an emergency defined in subsection (d) of this section, unless emergency bylaws provide otherwise: (1) Notice of a meeting of the board of directors need be given only to those directors whom it is practicable to reach and may be given in any practicable manner, including by publication and radio; and (2) one or more officers of the corporation present at a meeting of the board of directors may be deemed to be directors for the meeting, in order of rank and within the same rank in order of seniority, as necessary to achieve a quorum.
(c) Corporate action taken in good faith during an emergency under this section to further the ordinary business affairs of the corporation: (1) Binds the corporation; and (2) may not be used to impose liability on a corporate director, officer, employee or agent.
(d) An emergency exists for purposes of this section if a quorum of the corporation’s directors cannot readily be assembled because of some catastrophic event.
(P.A. 94-186, S. 30, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-649. Ultra vires. (a) Except as provided in subsection (b) of this section, the validity of corporate action may not be challenged on the ground that the corporation lacks or lacked power to act.
(b) A corporation’s power to act may be challenged: (1) In a proceeding by a shareholder against the corporation to enjoin the act; or (2) in a proceeding by the corporation, directly, derivatively or through a receiver, trustee or other legal representative, against an incumbent or former director, officer, employee or agent of the corporation.
(c) In a shareholder’s proceeding under subdivision (1) of subsection (b) of this section to enjoin an unauthorized corporate act, the court may enjoin or set aside the act, if equitable and if all affected persons are parties to the proceeding, and may award damages for loss, other than anticipated profits, suffered by the corporation or another party because of enjoining the unauthorized act.
(P.A. 94-186, S. 31, 215; P.A. 96-271, S. 25, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 deleted Subsec. (b)(3) re challenge in a proceeding by the Attorney General under Sec. 33-896, effective January 1, 1997.
Secs. 33-650 to 33-654. Reserved for future use.
PART IV
NAME
Sec. 33-655. Corporate name. (a) The name of each corporation formed after January 1, 1961: (1) Shall contain the word “corporation”, “incorporated”, “company”, “Societa per Azioni” or “limited”, or the abbreviation “corp.”, “inc.”, “co.”, “S.p.A.” or “ltd.”, or words or abbreviations of like import in another language; and (2) may not contain language stating or implying that the corporation is organized for a purpose other than that permitted by section 33-645 and its certificate of incorporation.
(b) Except as authorized by subsections (c) and (d) of this section, a corporate name must be distinguishable upon the records of the Secretary of the State from: (1) The corporate name of a corporation incorporated or authorized to transact business in this state; (2) a corporate name reserved or registered under section 33-656 or 33-657; (3) the fictitious name adopted by a foreign corporation authorized to transact business in this state because its real name is unavailable; (4) the corporate name of a nonprofit corporation incorporated or authorized to transact business in this state; (5) the corporate name of any domestic or foreign nonstock corporation incorporated or authorized to transact business in this state; (6) the name of any domestic or foreign limited partnership organized or authorized to transact business in this state; (7) the name of any domestic or foreign limited liability company organized or authorized to transact business in this state; (8) the name of any domestic or foreign limited liability partnership organized or authorized to transact business in this state; and (9) the name of any other entity whose name is carried upon the records of the Secretary of the State as organized or authorized to transact business or conduct affairs in this state.
(c) A corporation may apply to the Secretary of the State for authorization to use a name that is not distinguishable upon his records from one or more of the names described in subsection (b) of this section. The Secretary of the State shall authorize use of the name applied for if: (1) The other corporation, limited partnership, limited liability company or limited liability partnership, as the case may be, consents to the use in writing and submits an undertaking in form satisfactory to the Secretary of the State to change its name to a name that is distinguishable upon the records of the Secretary of the State from the name of the applying corporation; or (2) the applicant delivers to the Secretary of the State a certified copy of the final judgment of a court of competent jurisdiction establishing the applicant’s right to use the name applied for in this state.
(d) A corporation may use the name, including the fictitious name, of another domestic or foreign corporation that is used in this state if the other corporation is incorporated or authorized to transact business in this state and the corporation seeking to use the name: (1) Has merged with the other corporation; (2) has been formed by reorganization of the other corporation; or (3) has acquired all or substantially all of the assets, including the corporate name, of the other corporation.
(e) Sections 33-600 to 33-998, inclusive, do not control the use of fictitious names.
(P.A. 94-186, S. 32, 215; P.A. 96-271, S. 26, 254; P.A. 04-240, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, amended Subsec. (b)(4) to replace “not-for-profit” with “nonprofit” and added Sub. (b)(8) re the name of any domestic or foreign limited liability partnership, amended Subsec. (c)(1) to add “limited partnership, limited liability company or limited liability partnership, as the case may be,” and amended Subsec. (d) to replace “proposed user corporation” with “corporation seeking to use the name”, effective January 1, 1997; P.A. 04-240 added Subsec. (b)(9) re name of other entity carried on records of the Secretary of the State.
Sec. 33-656. Reserved name. (a) A person may reserve the exclusive use of a corporate name, including a corporate name of a foreign corporation, with such additional distinctive and distinguishing elements that the corporation agrees to use in this state exclusive of any other name as in the judgment of the Secretary of the State will be sufficient to distinguish its name, by delivering an application to the Secretary of the State for filing. The application shall set forth the name and address of the applicant and the name proposed to be reserved. If the Secretary of the State finds that the corporate name applied for is available, he shall reserve the name for the applicant’s exclusive use for a period of one hundred twenty days.
(b) The owner of a reserved corporate name may transfer the reservation to another person by delivering to the Secretary of the State a signed notice of the transfer that states the name and address of the transferee.
(c) Any person for whom a specified corporate name has been reserved pursuant to this section may, during the period for which such name is reserved, terminate such reservation by filing in the office of the Secretary of the State an application for cancellation of reservation of corporate name, together with the applicable fee.
(P.A. 94-186, S. 33, 215; P.A. 96-271, S. 27, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 made a technical change in Subsec. (a) and added Subsec. (c) to authorize a person for whom a specified corporate name has been reserved to terminate such reservation, effective January 1, 1997.
Sec. 33-657. Registered name. (a) A foreign corporation may register its corporate name, or its corporate name with any addition required by section 33-925, if the name is distinguishable upon the records of the Secretary of the State from the names that are not available under subsection (b) of section 33-655.
(b) A foreign corporation registers its corporate name, or its corporate name with any addition required by section 33-925, by delivering to the Secretary of the State for filing an application: (1) Setting forth its corporate name, or its corporate name with any addition required by section 33-925, the state or country and date of its incorporation, and a brief description of the nature of the business in which it is engaged; and (2) accompanied by a certificate of existence, or a document of similar import, from the state or country of incorporation.
(c) The name is registered for the applicant’s exclusive use upon the effective date of the application until the close of the calendar year in which the application for registration is filed.
(d) A foreign corporation whose registration is effective may renew it for successive years by delivering to the Secretary of the State for filing a renewal application, which complies with the requirements of subsection (b) of this section, between October first and December thirty-first of the preceding year. The renewal application when filed renews the registration for the following calendar year.
(P.A. 94-186, S. 34, 215; P.A. 96-271, S. 28, 254; P.A. 97-246, S. 6, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “corporate names that are not available under subdivision (3) of subsection (b) of section 33-655” with “names that are not available under subsection (b) of section 33-655”, effective January 1, 1997; P.A. 97-246 amended Subsec. (c) to provide that the name is registered until the close of the calendar year in which the application for registration is filed, effective June 27, 1997.
Secs. 33-658 and 33-659. Reserved for future use.
PART V
OFFICE AND AGENT
Sec. 33-660. Registered office and registered agent. (a) Each corporation that is required to file an annual report as provided in section 33-953 shall continuously maintain in this state: (1) A registered office that may be the same as any of its places of business; and (2) a registered agent at such registered office, who may be: (A) A natural person who is a resident of this state; (B) a domestic corporation; (C) a foreign corporation which has procured a certificate of authority to transact business or conduct its affairs in this state; (D) a domestic limited liability company; (E) a limited liability company not organized under the laws of this state and which has procured a certificate of registration to transact business or conduct its affairs in this state; (F) a domestic registered limited liability partnership; (G) a registered limited liability partnership not organized under the laws of this state and which has procured a certificate of authority to transact business or conduct its affairs in this state; (H) a domestic statutory trust; or (I) a statutory trust not organized under the laws of this state and which has procured a certificate of registration to transact business or conduct its affairs in this state. The appointment of such registered agent shall be in writing and shall be signed by the registered agent therein appointed. If a natural person is appointed as the registered agent, such appointment shall include the residence address of such person.
(b) In addition to persons or entities who may act as a registered agent pursuant to subsection (a) of this section, a foreign corporation may appoint the Secretary of the State and his successors in office to act as its registered agent.
(P.A. 94-186, S. 35, 215; P.A. 97-246, S. 7, 99; P.A. 98-137, S. 28, 62; 98-219, S. 33, 34; P.A. 04-240, S. 2.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to make provisions applicable to each corporation that is required to file an annual report as provided in Sec. 33-953, require the corporation to maintain a registered agent “at such registered office” and provide that an appointment of a natural person as registered agent shall include the person’s written consent to the appointment and the residence address of such person and amended Subsec. (b) to make a technical change, effective June 27, 1997; P.A. 98-137 added Subsec. (a)(2)(D) and (E) authorizing a domestic limited liability company and a limited liability company not organized under the laws of this state and which has procured a certificate of authority to transact business or conduct its affairs in this state, respectively, to be a registered agent, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 04-240 added Subsec. (a)(2)(F) to (I) re registered limited liability partnerships and statutory trusts as registered agents, added provision re appointment of registered agent in writing signed by the agent, deleted provision re written consent of natural person appointed as registered agent and made technical changes.
Sec. 33-661. Change of registered office or registered agent. (a) A corporation may change its registered office or registered agent by delivering to the Secretary of the State for filing a statement of change that sets forth: (1) The name of the corporation; (2) if the current registered office is to be changed, the street address of its current registered office and the street address of the new registered office; and (3) if the current registered agent is to be changed, the name of its current registered agent and the name of the new registered agent and the new agent’s written consent, either on the statement or attached to it, to the appointment.
(b) If the street address of a registered agent’s business office changes, he may change the street address of the registered office of any corporation for which he is the registered agent by delivering a signed written notice of the change to the corporation and delivering to the Secretary of the State for filing a signed statement that complies with the requirements of subsection (a) of this section and recites that the corporation has been notified of the change.
(P.A. 94-186, S. 36, 215; P.A. 96-271, S. 29, 254; P.A. 97-246, S. 8, 99; P.A. 11-147, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 deleted Subsec. (a)(6) requiring the statement to set forth that after the change or changes are made the street addresses of its registered office and the business office of its registered agent will be identical, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to combine former Subdivs. (2) and (3) into Subdiv. (2), thereby providing that the statement must set forth the street address of the current registered office only if the current registered office is to be changed and combined former Subdivs. (4) and (5) into new Subdiv. (3), thereby providing that the statement must set forth the name of the current registered agent only if the current registered agent is to be changed, effective June 27, 1997; P.A. 11-147 amended Subsec. (b) to rephrase provision re change of street address of registered agent’s business office and provide that agent may change address “by delivering a signed written notice of the change to the corporation and delivering to the Secretary of the State for filing a signed statement”, rather than “by notifying the corporation in writing of the change and signing, either manually or in facsimile, and delivering to the Secretary of the State for filing a statement”.
Sec. 33-662. Resignation of registered agent. (a) A registered agent may resign his agency appointment by signing and delivering to the Secretary of the State for filing the signed original and one exact or conformed copy of a statement of resignation. The statement may include a statement that the registered office is also discontinued.
(b) After filing the statement, the Secretary of the State shall mail the copy to the corporation at its principal office.
(c) The agency appointment is terminated, and the registered office discontinued if so provided, on the thirty-first day after the date on which the statement was filed.
(P.A. 94-186, S. 37, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-663. Service of process on corporation. (a) A corporation’s registered agent is the corporation’s agent for service of process, notice or demand required or permitted by law to be served on the corporation. Service may be effected by any proper officer or other person lawfully empowered to make service by leaving a true and attested copy of the process, notice or demand with such agent or, in the case of an agent who is a natural person, by leaving it at such agent’s usual place of abode in this state.
(b) If a corporation has no registered agent, or the agent cannot with reasonable diligence be served, the corporation may be served by any proper officer or other person lawfully empowered to make service by sending a true and attested copy of the process, notice or demand by registered or certified mail, return receipt requested, addressed to the secretary of the corporation at its principal office. Service is effective under this subsection at the earliest of: (1) The date the corporation receives the mail; (2) the date shown on the return receipt, if signed on behalf of the corporation; or (3) five days after its deposit in the United States mail, as evidenced by the postmark, if mailed postage prepaid and correctly addressed.
(c) This section does not prescribe the only means, or necessarily the required means, of serving a corporation.
(P.A. 94-186, S. 38, 215; P.A. 96-271, S. 30, 254; P.A. 97-246, S. 9, 10, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to add provision authorizing service to be effected by leaving a copy with the agent or, in the case of an agent who is a natural person, at the agent’s usual place of abode, effective January 1, 1997; P.A. 97-246 amended Subsecs. (a) and (b) to provide that service may be made by any proper officer or other person lawfully empowered to make service and amended Subsec. (b) to provide that the service sent to the corporation is a true and attested copy of the process, notice or demand, replace “perfected” with “effective” and replace “postpaid” with “postage prepaid”, effective June 27, 1997.
See Sec. 1-2a re construction of references to “United States mail”, “postmark” or “registered or certified mail”.
Sec. 33-664. Reserved for future use.
PART VI
SHARES AND DISTRIBUTIONS
(A)
SHARES
Sec. 33-665. Authorized shares. (a) The certificate of incorporation shall set forth any classes of shares and series of shares within a class, and the number of shares of each class and series, that the corporation is authorized to issue. If more than one class or series of shares is authorized, the certificate of incorporation shall prescribe a distinguishing designation for each class or series and must describe, prior to the issuance of shares of a class or series, the terms, including the preferences, rights and limitations, of such class or series. Except to the extent varied as permitted by this section, all shares of a class or series shall have terms, including preferences, rights and limitations, that are identical with those of other shares of the same class or series.
(b) The certificate of incorporation shall authorize (1) one or more classes or series of shares that together have unlimited voting rights, and (2) one or more classes or series of shares, which may be the same class or classes as those with voting rights, that together are entitled to receive the net assets of the corporation upon dissolution.
(c) The certificate of incorporation may authorize one or more classes or series of shares that: (1) Have special, conditional or limited voting rights, or no right to vote, except as otherwise provided by sections 33-600 to 33-998, inclusive; (2) are redeemable or convertible as specified in the certificate of incorporation (A) at the option of the corporation, the shareholder or another person or upon the occurrence of a specified event, (B) for cash, indebtedness, securities or other property, and (C) at prices and in amounts specified or determined in accordance with a formula; (3) entitle the holders to distributions calculated in any manner, including dividends that may be cumulative, noncumulative or partially cumulative; or (4) have preference over any other class or series of shares with respect to distributions, including distributions upon the dissolution of the corporation.
(d) Terms of shares may be made dependent upon facts objectively ascertainable outside the certificate of incorporation in accordance with subsection (l) of section 33-608.
(e) Any of the terms of shares may vary among holders of the same class or series as long as such variations are expressly set forth in the certificate of incorporation.
(f) The description of the preferences, rights and limitations of classes or series of shares in subsection (c) of this section is not exhaustive.
(P.A. 94-186, S. 39, 215; P.A. 96-271, S. 31, 254; P.A. 03-158, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-158 amended Subsec. (a) by replacing “shall prescribe the classes” with “shall set forth any classes”, adding provisions re series of shares within a class and revising provisions re terms, preferences, rights and limitations of classes or series, amended Subsec. (b) by adding references to series, amended Subsec. (c) by adding references to series, replacing “except to the extent prohibited” with “except as otherwise provided”, replacing “designated event” with “specified event”, replacing provision re designated amount or amount determined in accordance with designated formula or reference to extrinsic data or events with provision re prices and amounts specified or determined in accordance with formula and making technical changes, added new Subsecs. (d) and (e) re terms dependent upon facts objectively ascertainable outside certificate of incorporation and re variation of terms of shares among holders, redesignated existing Subsec. (d) as Subsec. (f) and amended same by deleting provisions re designations and relative rights and adding provisions re rights of classes or series of shares.
Sec. 33-666. Terms of class or series of shares. (a) If the certificate of incorporation so provides, the board of directors is authorized, without shareholder approval, to: (1) Classify any unissued shares into one or more classes or into one or more series within a class; (2) reclassify any unissued shares of any class into one or more classes or into one or more series within one or more classes; or (3) reclassify any unissued shares of any series of any class into one or more classes or into one or more series within a class.
(b) If the board of directors acts pursuant to subsection (a) of this section, it must determine the terms, including the preferences, rights and limitations, to the same extent permitted under section 33-665, of: (1) Any class of shares before the issuance of any shares of such class; or (2) any series within a class before the issuance of any shares of such series.
(c) Before issuing any shares of a class or series created under this section, the corporation must deliver to the Secretary of the State for filing a certificate of amendment setting forth the terms determined under subsection (a) of this section.
(P.A. 94-186, S. 40, 215; P.A. 96-271, S. 32, 33, 254; P.A. 03-158, S. 7.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and amended Subsec. (d) to replace “articles” of amendment with “a certificate” of amendment, effective January 1, 1997; P.A. 03-158 amended Subsec. (a) by replacing provisions re board determination of preferences, limitations and relative rights of classes or series with provisions re board authorization, without shareholder approval, to classify or reclassify shares, classes or series, amended Subsec. (b) by replacing provision re distinguishing designation with provisions re determination of terms of class or series, deleted former Subsec. (c) re preferences, limitations and relative rights of shares of a series, redesignated existing Subsec. (d) as new Subsec. (c) and amended same by replacing provisions re contents of certificate of amendment which is effective without shareholder action with provisions re certificate of amendment to set forth terms determined under Subsec. (a).
Sec. 33-667. Issued and outstanding shares. (a) A corporation may issue the number of shares of each class or series authorized by the certificate of incorporation. Shares that are issued are outstanding shares until they are reacquired, redeemed, converted or cancelled.
(b) The reacquisition, redemption or conversion of outstanding shares is subject to the limitations of subsection (c) of this section and to section 33-687.
(c) At all times that shares of the corporation are outstanding, one or more shares that together have unlimited voting rights and one or more shares that together are entitled to receive the net assets of the corporation upon dissolution must be outstanding.
(P.A. 94-186, S. 41, 215; P.A. 96-271, S. 34, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-668. Fractional shares. (a) A corporation may: (1) Issue fractions of a share or pay in money the value of fractions of a share; (2) arrange for disposition of fractional shares by the shareholders; and (3) issue scrip in registered or bearer form entitling the holder to receive a full share upon surrendering enough scrip to equal a full share.
(b) Each certificate representing scrip must be conspicuously labeled “scrip” and must contain the information required by subsection (b) of section 33-676.
(c) The holder of a fractional share is entitled to exercise the rights of a shareholder, including the right to vote, to receive dividends and to participate in the assets of the corporation upon liquidation. The holder of scrip is not entitled to any of these rights unless the scrip provides for them.
(d) The board of directors may authorize the issuance of scrip subject to any condition considered desirable, including: (1) That the scrip will become void if not exchanged for full shares before a specified date; and (2) that the shares for which the scrip is exchangeable may be sold and the proceeds paid to the scripholders.
(P.A. 94-186, S. 42, 215; P.A. 96-271, S. 35, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to add “and” prior to Subdiv. (3), effective January 1, 1997.
Secs. 33-669 and 33-670. Reserved for future use.
(B)
ISSUANCE OF SHARES
Sec. 33-671. Subscription for shares before incorporation. (a) A subscription for shares entered into before incorporation is irrevocable for six months unless the subscription agreement provides a longer or shorter period or all the subscribers agree to revocation.
(b) The board of directors may determine the payment terms of subscriptions for shares that were entered into before incorporation unless the subscription agreement specifies them. A call for payment by the board of directors must be uniform so far as practicable as to all shares of the same class or series unless the subscription agreement specifies otherwise.
(c) Shares issued pursuant to subscriptions entered into before incorporation are fully paid and nonassessable when the corporation receives the consideration specified in the subscription agreement.
(d) If a subscriber defaults in payment of money or property under a subscription agreement entered into before incorporation, the corporation may collect the amount owed as any other debt. Alternatively, unless the subscription agreement provides otherwise, the corporation may rescind the agreement and may sell the shares if the debt remains unpaid more than twenty days after the corporation sends a written demand for payment to the subscriber.
(e) A subscription agreement entered into after incorporation is a contract between the subscriber and the corporation subject to section 33-672.
(P.A. 94-186, S. 43, 215; P.A. 11-147, S. 13.)
History: P.A. 94-186 effective January 1, 1997; P.A. 11-147 amended Subsec. (d) to make a technical change.
Sec. 33-672. Issuance of shares. (a) The powers granted in this section to the board of directors may be reserved to the shareholders by the certificate of incorporation.
(b) The board of directors may authorize shares to be issued for consideration consisting of any tangible or intangible property or benefit to the corporation, including cash, promissory notes, services performed, contracts for services to be performed or other securities of the corporation.
(c) Before the corporation issues shares, the board of directors must determine that the consideration received or to be received for shares to be issued is adequate. That determination by the board of directors is conclusive insofar as the adequacy of consideration for the issuance of shares relates to whether the shares are validly issued, fully paid and nonassessable.
(d) When the corporation receives the consideration for which the board of directors authorized the issuance of shares, the shares issued therefor are fully paid and nonassessable.
(e) The corporation may place in escrow shares issued for a contract for future services or benefits or a promissory note, or make other arrangements to restrict the transfer of the shares, and may credit distributions in respect of the shares against their purchase price, until the services are performed, the note is paid or the benefits received. If the services are not performed, the note is not paid or the benefits are not received, the issuance of the shares escrowed or restricted and the distributions credited may be rescinded in whole or part. Shares whose issuance have been so rescinded shall return to being authorized but unissued.
(f) At the time of authorizing the issuance of convertible shares, the corporation shall provide for and at all times thereafter retain unissued sufficient shares of appropriate classes to satisfy the conversion privileges of all of its issued and outstanding convertible shares.
(P.A. 94-186, S. 44, 215; P.A. 96-271, S. 36, 37, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and amended Subsec. (e) to provide that “the issuance of the shares escrowed or restricted and the distributions credited may be rescinded” rather than “the shares escrowed or restricted and the distributions credited may be cancelled” and add provision that shares whose issuance have been so rescinded shall return to being authorized but unissued, effective January 1, 1997.
Sec. 33-673. Liability of shareholders. (a) A purchaser from a corporation of its own shares is not liable to the corporation or its creditors with respect to the shares except to pay the consideration for which the shares were authorized to be issued as provided in section 33-672 or specified in the subscription agreement as provided in section 33-671.
(b) Unless otherwise provided in the certificate of incorporation, a shareholder of a corporation is not personally liable for the acts or debts of the corporation except that he may become personally liable by reason of his own acts or conduct.
(P.A. 94-186, S. 45, 215; P.A. 96-271, S. 38, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Subsec. (b):
Although one might reasonably conclude that president of defendant corporation misapplied company assets to his personal use and inappropriately handled company finances, his actions did not warrant application of common-law exception to statutory protection against personal liability. 75 CA 27.
Sec. 33-673a. Definitions. As used in this section and sections 33-673b and 33-673c:
(1) “Affiliate” means with respect to any specified person, any other person directly or indirectly controlling, controlled by or under common control with such specified person. As used in this subdivision, “control” has the same meaning given to that term in 17 CFR 240.12b-2, as amended from time to time;
(2) “Domestic entity” means an entity whose internal affairs are governed by the law of this state;
(3) “Entity” means (A) a business corporation, (B) a nonstock corporation, (C) a limited liability partnership, (D) a limited partnership, including a limited liability limited partnership, (E) a limited liability company, or (F) any other person that (i) has a separate legal existence, and (ii) is subject to a provision of the general statutes which provides that an interest holder of such person is not personally liable for a debt, obligation or other liability of such person solely by reason of being or acting as such interest holder;
(4) “Governance interest” has the same meaning as provided in section 34-600;
(5) “Governor” has the same meaning as provided in section 34-600;
(6) “Interest” means (A) a governance interest in an entity, (B) a transferable interest in an entity, or (C) a share, membership interest or other ownership interest in an entity;
(7) “Interest holder” has the same meaning as provided in section 34-600;
(8) “Person” has the same meaning as provided in section 34-600; and
(9) “Transferable interest” has the same meaning as provided in section 34-600.
(P.A. 19-181, S. 1.)
History: P.A. 19-181 effective July 9, 2019, and applicable to any civil action filed on or after July 9, 2019.
Sec. 33-673b. Limitation on liability of an interest holder of a domestic entity. Application of veil piercing doctrine, when permitted. (a) A statutory limitation on the liability of an interest holder of a domestic entity for a debt, obligation or other liability of such domestic entity, including without limitation, the limitation set forth in section 33-673 or 34-251a, may not be disregarded based upon a veil piercing doctrine, claim or remedy in connection with a transaction to which the entity is a party, unless a court finds by a preponderance of the evidence that: (1) The interest holder exerted complete domination and control over the management, finances, policies and activities of such entity with respect to such transaction; (2) such domination and control was used by the interest holder to (A) commit fraud or other intentional wrong against the person asserting such doctrine, claim or remedy, (B) intentionally violate a statutory or common law duty to such person, or (C) commit a deceitful or other unlawful act against such person; and (3) the domination and control exerted by the interest holder and the breach of duty or other act proximately caused injury or loss to the person asserting such doctrine, claim or remedy.
(b) In making a determination under subdivision (1) of subsection (a) of this section, a court shall consider factors that include, but are not limited to, whether: (1) The entity was adequately capitalized, (2) assets of the entity were distributed or otherwise transferred from the entity to the interest holder or any affiliate of such interest holder without any lawful business purpose, (3) there were overlapping interest holders, governors or other management personnel between the entity and the interest holder or any affiliate of such interest holder, (4) the interest holder or any affiliate of such interest holder shared office spaces, addresses and telephone numbers with the entity without payment of fair consideration, (5) transactions involving the entity and the interest holder or any affiliate of such interest holder were at arm’s length and for fair consideration, (6) funds of the entity were commingled with funds of the interest holder or any affiliate of such interest holder, (7) the entity was treated as a separate legal entity for financial and other business purposes as evidenced by having its own contractual relationships, bank accounts, books of account and financial statements, (8) the entity was insolvent or rendered insolvent by the acts of the interest holder or any affiliate of such interest holder, and (9) the property of the entity was used by the interest holder or any affiliate of such interest holder without payment of fair consideration.
(c) The burden of proof shall be on the person seeking to hold the interest holder of a domestic entity responsible for the debts, obligations or other liabilities of such entity.
(d) The failure of a domestic entity to observe formalities relating to the exercise of its powers or the management of its activities and affairs is not grounds for imposing personal liability on an interest holder of such entity for a debt, obligation or other liability of such entity based upon a veil piercing doctrine, claim or remedy.
(e) When determining whether a statutory limitation on the liability of an interest holder of a domestic entity for a debt, obligation or other liability of such domestic entity, including without limitation, the limitation set forth in section 33-673 or 34-251a, may be disregarded based upon a veil piercing doctrine, claim or remedy, a court shall make such determination exclusively in accordance with the provisions of this section and section 33-673a.
(P.A. 19-181, S. 2; P.A. 21-40, S. 39.)
History: P.A. 19-181 effective July 9, 2019, and applicable to any civil action filed on or after July 9, 2019; P.A. 21-40 made a technical change in Subsec. (e).
Sec. 33-673c. Liability of domestic entity based upon reverse veil piercing doctrine, not permitted. No domestic entity shall be responsible for a debt, obligation or other liability of an interest holder of such entity based upon a reverse veil piercing doctrine, claim or remedy.
(P.A. 19-181, S. 3.)
History: P.A. 19-181 effective July 9, 2019, and applicable to any civil action filed on or after July 9, 2019.
Section arguably expresses legislative intent to prevent courts from applying the doctrine of reverse veil piercing, but effective date was prospective and does not affect court’s decision to apply reverse veil piercing to an action commenced prior to the effective date of the section, July 9, 2019. 332 C. 394.
Sec. 33-674. Share dividends. (a) Unless the certificate of incorporation provides otherwise, shares may be issued pro rata and without consideration to the corporation’s shareholders or to the shareholders of one or more classes or series. An issuance of shares under this subsection is a share dividend.
(b) Shares of one class or series may not be issued as a share dividend in respect of shares of another class or series unless (1) the certificate of incorporation so authorizes, (2) a majority of the votes entitled to be cast by the class or series to be issued approve the issue, or (3) there are no outstanding shares of the class or series to be issued.
(c) If the board of directors does not fix the record date for determining shareholders entitled to a share dividend, it is the date the board of directors authorizes the share dividend.
(P.A. 94-186, S. 46, 215; P.A. 96-271, S. 39, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
Sec. 33-675. Share options and other equity compensation awards. (a) A corporation may issue rights, options or warrants for the purchase of shares or other securities of the corporation. The board of directors shall determine (1) the terms upon which the rights, options or warrants are issued, and (2) the terms upon which, including the consideration for which, the shares or other securities are to be issued. The authorization by the board of directors for the corporation to issue such rights, options or warrants constitutes authorization of the issuance of the shares or other securities for which the rights, options or warrants are exercisable.
(b) The terms and conditions of such rights, options or warrants, including those outstanding on October 1, 2003, may include, but are not limited to, restrictions or conditions that: (1) Preclude or limit the exercise, transfer or receipt of such rights, options or warrants by any person or persons owning or offering to acquire a specified number or percentage of the outstanding shares or other securities of the corporation or by any transferee or transferees of any such person or persons; or (2) invalidate or void such rights, options or warrants held by any such person or persons or any such transferee or transferees.
(c) The board of directors may authorize one or more officers to (1) designate the recipients of rights, options, warrants or other equity compensation awards that involve the issuance of shares, and (2) determine, within an amount and subject to any other limitations established by the board and, if applicable, the shareholders, the number of such rights, options, warrants or other equity compensation awards and the terms thereof to be received by the recipients, provided an officer may not use such authority to designate himself or herself, or any other persons as the board of directors may specify, as a recipient of such rights, options, warrants or other equity compensation awards.
(P.A. 94-186, S. 47, 215; P.A. 03-158, S. 8; P.A. 10-35, S. 3.)
History: P.A. 94-186 effective January 1, 1997; P.A. 03-158 designated existing provisions as Subsec. (a), amended same by adding provisions re other securities, deleting provision re form and content, adding provision re authorization by the board of directors and making technical changes, and added Subsec. (b) re restrictions on or conditions of rights, options or warrants; P.A. 10-35 added Subsec. (c) re designation and determination of rights, options, warrants or other equity compensation awards.
Sec. 33-676. Form and content of certificates. (a) Shares may but need not be represented by certificates. Unless sections 33-600 to 33-998, inclusive, or any other provision of the general statutes expressly provides otherwise, the rights and obligations of shareholders are identical whether or not their shares are represented by certificates.
(b) At a minimum each share certificate shall state on its face: (1) The name of the issuing corporation and that it is organized under the law of this state; (2) the name of the person to whom issued; and (3) the number and class of shares and the designation of the series, if any, the certificate represents.
(c) If the issuing corporation is authorized to issue different classes of shares or different series within a class, the designations, relative rights, preferences and limitations applicable to each class and the variations in rights, preferences and limitations determined for each series, and the authority of the board of directors to determine variations for future series, shall be summarized on the front or back of each certificate. Alternatively, each certificate may state conspicuously on its front or back that the corporation will furnish the shareholder this information on request in writing and without charge.
(d) Each share certificate (1) shall be signed either manually or in facsimile by two officers designated in the bylaws or by the board of directors and (2) may bear the corporate seal or its facsimile.
(e) If the person who signed, either manually or in facsimile, a share certificate no longer holds office when the certificate is issued, the certificate is nevertheless valid.
(P.A. 94-186, S. 48, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-677. Shares without certificates. (a) Unless the certificate of incorporation or a bylaw provides otherwise, the board of directors of a corporation may authorize the issue of some or all of the shares of any or all of its classes or series without certificates. The authorization does not affect shares already represented by certificates until they are surrendered to the corporation.
(b) Within a reasonable time after the issue or transfer of shares without certificates, the corporation shall send the shareholder a written statement of the information required on certificates by subsections (b) and (c) of section 33-676, and, if applicable, section 33-678.
(P.A. 94-186, S. 49, 215; P.A. 96-271, S. 40, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and “bylaws” with “a bylaw”, effective January 1, 1997.
Sec. 33-678. Restriction on transfer of shares and other securities. (a) The certificate of incorporation, the bylaws, an agreement among shareholders or an agreement between shareholders and the corporation may impose restrictions on the transfer or registration of transfer of shares of the corporation. A restriction does not affect shares issued before the restriction was adopted unless the holders of the shares are parties to the restriction agreement or voted in favor of the restriction.
(b) A restriction on the transfer or registration of transfer of shares is valid and enforceable against the holder or a transferee of the holder if the restriction is authorized by this section and its existence is noted conspicuously on the front or back of the certificate or is contained in the information statement required by subsection (b) of section 33-677. Unless so noted, a restriction is not enforceable against a person without knowledge of the restriction.
(c) A restriction on the transfer or registration of transfer of shares is authorized: (1) To maintain the corporation’s status when it is dependent on the number or identity of its shareholders; (2) to preserve exemptions under federal or state securities law; (3) for any other reasonable purpose.
(d) A restriction on the transfer or registration of transfer of shares may: (1) Obligate the shareholder first to offer the corporation or other persons separately, consecutively or simultaneously an opportunity to acquire the restricted shares; (2) obligate the corporation or other persons separately, consecutively or simultaneously to acquire the restricted shares; (3) require the corporation, the holders of any class of its shares or another person to approve the transfer of the restricted shares, if the requirement is not manifestly unreasonable; (4) prohibit the transfer of the restricted shares to designated persons or classes of persons, if the prohibition is not manifestly unreasonable.
(e) For purposes of this section, “shares” includes a security convertible into or carrying a right to subscribe for or acquire shares.
(P.A. 94-186, S. 50, 215; P.A. 96-271, S. 41, 42, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and amended Subsec. (c) to make a technical change, effective January 1, 1997.
Sec. 33-679. Expense of issue. A corporation may pay the expenses of selling or underwriting its shares, and of organizing or reorganizing the corporation, from the consideration received for shares.
(P.A. 94-186, S. 51, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-680. Surrender of share certificates. The board of directors of a corporation may, from time to time, for any proper purpose, require shareholders to surrender their share certificates in exchange for new certificates, or for the entering thereof of an appropriate legend or notation, and may take reasonable measures to enforce such requirement. Without limiting the generality of the foregoing, the board of directors of the surviving corporation in a merger, or of a corporation the certificate of incorporation of which has been amended, may require shareholders holding share certificates which do not reflect such merger or amendment to surrender the same in exchange for new certificates, or for the entering thereon of an appropriate legend or notation, and may, after written notice thereof to such shareholders, refuse to pay dividends or make other distributions in respect of unsurrendered certificates, but in such case such dividends and distributions shall be accumulated for the benefit of the holders thereof, but with interest, until such certificates are so surrendered.
(P.A. 94-186, S. 52, 215.)
History: P.A. 94-186 effective January 1, 1997.
Secs. 33-681 and 33-682. Reserved for future use.
(C)
SUBSEQUENT ACQUISITION OF SHARES
Sec. 33-683. Shareholder’s preemptive rights. (a) The shareholders of a corporation do not have a preemptive right to acquire the corporation’s unissued shares except to the extent the certificate of incorporation so provides or as set forth in subsection (d) of this section.
(b) A statement included in the certificate of incorporation that “the corporation elects to have preemptive rights”, or words of similar import, means that the following principles apply except to the extent the certificate of incorporation expressly provides otherwise:
(1) The shareholders of the corporation have a preemptive right, granted on uniform terms and conditions prescribed by the board of directors to provide a fair and reasonable opportunity to exercise the right, to acquire proportional amounts of the corporation’s unissued shares upon the decision of the board of directors to issue them.
(2) A shareholder may waive his preemptive right. A waiver evidenced by a writing is irrevocable even though it is not supported by consideration.
(3) There is no preemptive right with respect to: (A) Shares issued as compensation to directors, officers, agents or employees of the corporation, its subsidiaries or affiliates; (B) shares issued to satisfy conversion or option rights created to provide compensation to directors, officers, agents or employees of the corporation, its subsidiaries or affiliates; (C) shares authorized in the certificate of incorporation that are issued within six months from the effective date of incorporation; (D) shares sold otherwise than for money.
(4) Holders of shares of any class without general voting rights but with preferential rights to distributions or assets have no preemptive rights with respect to shares of any class.
(5) Holders of shares of any class with general voting rights but without preferential rights to distributions or assets have no preemptive rights with respect to shares of any class with preferential rights to distributions or assets unless the shares with preferential rights are convertible into or carry a right to subscribe for or acquire shares without preferential rights.
(6) Shares subject to preemptive rights that are not acquired by shareholders may be issued to any person for a period of one year after being offered to shareholders at a consideration set by the board of directors that is not lower than the consideration set for the exercise of preemptive rights. An offer at a lower consideration or after the expiration of one year is subject to the shareholders’ preemptive rights.
(c) For purposes of this section, “shares” includes a security convertible into or carrying a right to subscribe for or acquire shares.
(d) Notwithstanding any provision of this section to the contrary, the shareholders of a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, shall, unless the certificate of incorporation expressly provides otherwise, have the preemptive rights provided in subsection (b) of this section.
(P.A. 94-186, S. 53, 215; P.A. 96-271, S. 43, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (d) to replace “January 1, 1996” with “January 1, 1997”, effective January 1, 1997.
Sec. 33-684. Corporation’s acquisition of its own shares. (a) A corporation may acquire its own shares and shares so acquired constitute authorized but unissued shares.
(b) If the certificate of incorporation prohibits the reissue of the acquired shares, the number of authorized shares is reduced by the number of shares acquired.
(P.A. 94-186, S. 54, 215; P.A. 96-271, S. 44, 254; P.A. 03-18, S. 4.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation and amended Subsec. (c) to replace “articles” of amendment with “a certificate” of amendment, effective January 1, 1997; P.A. 03-18 amended Subsec. (b) to make a technical change and delete provision re reduction effective upon amendment of the certificate of incorporation and deleted former Subsec. (c) re adoption, filing and contents of certificate of amendment, effective July 1, 2003.
Secs. 33-685 and 33-686. Reserved for future use.
(D)
DISTRIBUTIONS
Sec. 33-687. Distributions to shareholders. (a) A board of directors may authorize and the corporation may make distributions to its shareholders subject to restriction by the certificate of incorporation and the limitation in subsection (c) of this section.
(b) If the board of directors does not fix the record date for determining shareholders entitled to a distribution, other than one involving a purchase, redemption or other acquisition of the corporation’s shares, it is the date the board of directors authorizes the distribution.
(c) No distribution may be made if, after giving it effect: (1) The corporation would not be able to pay its debts as they become due in the usual course of business; or (2) the corporation’s total assets would be less than the sum of its total liabilities plus, unless the certificate of incorporation permits otherwise, the amount that would be needed, if the corporation were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution.
(d) The board of directors may base a determination that a distribution is not prohibited under subsection (c) of this section either on financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances or on a fair valuation or other method that is reasonable in the circumstances.
(e) Except as provided in subsection (g) of this section, the effect of a distribution under subsection (c) of this section is measured: (1) In the case of distribution by purchase, redemption or other acquisition of the corporation’s shares, as of the earlier of (A) the date money or other property is transferred or debt incurred by the corporation or (B) the date the shareholder ceases to be a shareholder with respect to the acquired shares; (2) in the case of any other distribution of indebtedness, as of the date the indebtedness is distributed; and (3) in all other cases, as of (A) the date the distribution is authorized if the payment occurs within one hundred twenty days after the date of authorization or (B) the date the payment is made if it occurs more than one hundred twenty days after the date of authorization.
(f) A corporation’s indebtedness to a shareholder incurred by reason of a distribution made in accordance with this section is at parity with the corporation’s indebtedness to its general, unsecured creditors except to the extent subordinated by agreement.
(g) Indebtedness of a corporation, including indebtedness issued as a distribution, is not considered a liability for purposes of determinations under subsection (c) of this section if its terms provide that payment of principal and interest are made only if and to the extent that payment of a distribution to shareholders could then be made under this section. If the indebtedness is issued as a distribution, each payment of principal or interest is treated as a distribution, the effect of which is measured on the date the payment is actually made.
(h) This section shall not apply to distributions in the course of dissolution under sections 33-880 to 33-887, inclusive.
(P.A. 94-186, S. 55, 215; P.A. 96-271, S. 45, 46, 254; P.A. 03-18, S. 5.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-18 added Subsec. (h) re section not applicable to distributions in the course of dissolution, effective July 1, 2003.
Secs. 33-688 to 33-694. Reserved for future use.
PART VII
SHAREHOLDERS
(A)
MEETINGS
Sec. 33-695. Annual meeting. (a) Unless directors are elected by written consent in lieu of an annual meeting as permitted by section 33-698, a corporation shall hold a meeting of shareholders annually at a time stated in or fixed in accordance with the bylaws, provided, if a corporation’s certificate of incorporation authorizes shareholders to cumulate their votes when electing directors pursuant to section 33-712, directors may not be elected by less than unanimous written consent.
(b) Unless the board of directors determines that an annual shareholders’ meeting shall be held solely by means of remote communication in accordance with subsection (c) of section 33-703, such meeting (1) may be held in or out of this state at the place stated in or fixed in accordance with the bylaws, or (2) if no place is stated in or fixed in accordance with the bylaws, annual meetings shall be held at the corporation’s principal office.
(c) The failure to hold an annual meeting at the time stated in or fixed in accordance with a corporation’s bylaws does not affect the validity of any corporate action.
(P.A. 94-186, S. 56, 215; P.A. 09-55, S. 5; P.A. 21-39, S. 10.)
History: P.A. 94-186 effective January 1, 1997; P.A. 09-55 amended Subsec. (a) to add exception re when directors are elected by written consent in lieu of annual meeting and add proviso that if certificate of incorporation authorizes cumulative voting when electing directors, directors may not be elected by less than unanimous written consent; P.A. 21-39 amended Subsec. (b) to add provision re board of directors determination to hold meeting solely by means of remote communication, add Subdiv. designators (1) and (2) and make a conforming change, effective June 14, 2021.
Sec. 33-696. Special meeting. (a) A corporation shall hold a special meeting of shareholders: (1) On call of its board of directors or the person or persons authorized to do so by the certificate of incorporation or bylaws; or (2) if the holders of at least ten per cent of all the votes entitled to be cast on any issue proposed to be considered at the proposed special meeting sign, date and deliver to the corporation’s secretary one or more written demands for the meeting describing the purpose or purposes for which it is to be held, except that if the corporation has a class of voting stock registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended from time to time, and no person held ten per cent or more of all the votes entitled to be cast by the holders of such class of voting stock on February 1, 1988, the corporation need not hold such meeting except upon demand of the holders of not less than thirty-five per cent of such votes.
(b) If not otherwise fixed under section 33-697 or 33-701, the record date for determining shareholders entitled to demand a special meeting is the date the first shareholder signs the demand.
(c) Unless the board of directors determines that a special shareholders’ meeting shall be held solely by means of remote communication in accordance with subsection (c) of section 33-703, such meeting (1) may be held in or out of this state at the place stated in or fixed in accordance with the bylaws, or (2) if no place is stated or fixed in accordance with the bylaws, special meetings shall be held at the corporation’s principal office.
(d) Only business within the purpose or purposes described in the meeting notice required by subsection (c) of section 33-699 may be conducted at a special shareholders’ meeting.
(P.A. 94-186, S. 57, 215; P.A. 96-271, S. 47, 254; P.A. 21-39, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 21-39 amended Subsec. (a)(2) by replacing “such votes” with “all the votes entitled to be cast by the holders of such class of voting stock” and amended Subsec. (c) by adding provision re board of directors determination to hold meeting solely by means of remote communication, adding Subdiv. designators (1) and (2) and making a conforming change, effective June 14, 2021.
Cited. 45 CS 101.
Sec. 33-697. Court-ordered meeting. (a) The superior court for the judicial district where a corporation’s principal office or, if none in this state, its registered office is located may summarily order a meeting to be held: (1) On application of any shareholder of the corporation entitled to participate in an annual meeting if an annual meeting was not held or action by written consent in lieu thereof did not become effective within the earlier of six months after the end of the corporation’s fiscal year or fifteen months after its last annual meeting; or (2) on application of a shareholder who signed a demand for a special meeting valid under section 33-696, if: (A) Notice of the special meeting was not given within thirty days after the date the demand was delivered to the corporation’s secretary; or (B) the special meeting was not held in accordance with the notice.
(b) Unless the bylaws require a meeting of shareholders to be held at a place, the court may fix the time of the meeting, determine whether the meeting will be held at a place or solely by remote communication, and, if the meeting is to be held at a place, the place of the meeting, determine the shares entitled to participate in the meeting, specify a record date or dates for determining shareholders entitled to notice of and to vote at the meeting, prescribe the form and content of the meeting notice, fix the quorum required for specific matters to be considered at the meeting, or direct that the votes represented at the meeting constitute a quorum for action on those matters, and enter other orders necessary to accomplish the purpose or purposes of the meeting. The court may order the meeting to be held solely by means of remote communication in compliance with section 33-703 subject to such guidelines and procedures as the court may order, including implementation of the measures specified in subsection (b) of said section.
(P.A. 94-186, S. 58, 215; P.A. 09-55, S. 6; P.A. 11-147, S. 3; P.A. 21-39, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 09-55 amended Subsec. (a)(1) to authorize ordering of a meeting if action by written consent in lieu of annual meeting did not become effective within specified time period; P.A. 11-147 amended Subsec. (b) to authorize court to specify record “dates”; P.A. 21-39 amended Subsec. (b) by adding provisions re court order to hold meeting solely by remote communication, effective June 14, 2021.
Sec. 33-698. Action without meeting. (a) Action required or permitted under any provision of sections 33-600 to 33-998, inclusive, to be taken at a shareholders’ meeting may be taken without a meeting if the action is taken by all the shareholders entitled to vote on the action. The action must be evidenced by one or more written consents bearing the date of signature and describing the action taken, signed by all the shareholders entitled to vote on the action and delivered to the corporation for inclusion in the minutes or filing with the corporate records.
(b) The certificate of incorporation may provide that any action required or permitted by any provision of sections 33-600 to 33-998, inclusive, to be taken at a shareholders’ meeting may be taken without a meeting, and without prior notice, if consents in writing setting forth the action so taken are signed by the holders of outstanding shares having not less than the minimum number of votes that would be required to authorize or take the action at a meeting at which all shares entitled to vote on the action were present and voted. The written consent shall bear the date of signature of the shareholder who signs the consent and be delivered to the corporation for inclusion in the minutes or filing with the corporate records.
(c) If not otherwise fixed under section 33-701, and if prior board action is not required respecting the action to be taken without a meeting, the record date for determining the shareholders entitled to take action without a meeting shall be the first date on which a signed written consent is delivered to the corporation. If not otherwise fixed under section 33-701 and if prior board action is required respecting the action to be taken without a meeting, the record date shall be the close of business on the day the resolution of the board taking such prior action is adopted. No written consent shall be effective to take the corporate action referred to therein unless, within sixty days of the earliest date on which a consent delivered to the corporation as required by this section was signed, written consents signed by the holders of shares having sufficient votes to take the action have been delivered to the corporation. A written consent may be revoked by a writing to that effect delivered to the corporation before unrevoked written consents sufficient to take the corporate action are delivered to the corporation.
(d) A consent signed pursuant to the provisions of this section has the effect of a vote taken at a meeting and may be described as such in any document. Unless the certificate of incorporation, the bylaws or a resolution of the board of directors provides for a reasonable delay to permit tabulation of written consents, the action taken by written consent shall be effective when written consents signed by the holders of shares having sufficient votes to take the action are delivered to the corporation.
(e) If any provision of sections 33-600 to 33-998, inclusive, requires that notice of a proposed action be given to nonvoting shareholders and the action is to be taken by written consent of the voting shareholders, the corporation must give its nonvoting shareholders written notice of the action not more than ten days after (1) written consents sufficient to take the action have been delivered to the corporation, or (2) such later date that tabulation of consents is completed pursuant to an authorization under subsection (d) of this section. The notice must reasonably describe the action taken and contain or be accompanied by the same material that, under any provision of sections 33-600 to 33-998, inclusive, would have been required to be sent to nonvoting shareholders in a notice of a meeting at which the proposed action would have been submitted to the shareholders for action.
(f) If action is taken by less than unanimous written consent of the voting shareholders, the corporation must give its nonconsenting voting shareholders written notice of the action not more than ten days after (1) written consents sufficient to take the action have been delivered to the corporation, or (2) such later date that tabulation of consents is completed pursuant to an authorization under subsection (d) of this section. The notice must reasonably describe the action taken and contain or be accompanied by the same material that, under any provision of sections 33-600 to 33-998, inclusive, would have been required to be sent to voting shareholders in a notice of a meeting at which the action would have been submitted to the shareholders for action.
(g) The notice requirements in subsections (e) and (f) of this section shall not delay the effectiveness of actions taken by written consent, and a failure to comply with such notice requirements shall not invalidate actions taken by written consent, provided this subsection shall not be deemed to limit judicial power to fashion any appropriate remedy in favor of a shareholder adversely affected by a failure to give such notice within the required time period.
(P.A. 94-186, S. 59, 215; P.A. 96-271, S. 48, 254; P.A. 98-137, S. 3, 62; 98-219, S. 33, 34; P.A. 09-55, S. 4; P.A. 11-147, S. 14.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 98-137 amended Subsec. (a) to replace “consent” with “one or more consents”, require the consents to bear the date of signature and delete the provision that any consents which become effective shall have the same force and effect as a vote of shareholders at a meeting duly held and may be stated as such in any certificate or document filed under Secs. 33-600 to 33-998, inclusive, and amended Subsec. (b) to add provisions that barred the effectiveness of a written consent to take the corporate action referred to in such consent unless within 60 days written consents sufficient in number to take corporate action are received by the corporation and that authorized the revocation in writing of a written consent provided such revocation is not effective if it is received by the corporation after the corporation has received a sufficient number of unrevoked written consents to take corporate action, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 09-55 deleted former Subsec. (a) re action taken without a meeting by unanimous written consent or by less than unanimous written consent, the manner and timing of notice of proposed action and the submission of, and response to, written demands that proposed action not be taken by written consent, added new Subsec. (a) re action taken without a meeting by unanimous written consent, added new Subsec. (b) re action taken without a meeting, and without prior notice, by less than unanimous written consent, redesignated existing Subsec. (b) as Subsec. (c) and amended same to revise and rephrase provisions, including providing that if prior board action is not required, record date is the first date on which a signed written consent is delivered to the corporation and, if prior board action is required, record date is the close of business on the day the resolution of the board taking such prior action is adopted, redesignated existing Subsec. (c) as Subsec. (d) and amended same to rephrase provisions and add provision re effective date of action taken by written consent, added Subsec. (e) re timing and substance of notice that must be given to nonvoting shareholders, added Subsec. (f) re timing and substance of notice that must be given to nonconsenting voting shareholders if action is taken by less than unanimous written consent of voting shareholders, added Subsec. (g) re effect of compliance or noncompliance with notice requirements of Subsecs. (e) and (f) on actions taken by written consent, added Subsec. (h) re use of electronic transmission to consent to action and added Subsec. (i) re manner of delivery of written consent to the corporation; P.A. 11-147 deleted former Subsec. (h) re use of electronic transmission to consent to action and deleted former Subsec. (i) re manner of delivery of written consent to corporation.
Sec. 33-699. Notice of meeting. (a) A corporation shall notify shareholders of the date and time of each annual and special shareholders’ meeting and, if the meeting is to be held at a place, the place of such meeting, no fewer than ten nor more than sixty days before the meeting date. The notice shall include the record date for determining the shareholders entitled to vote at the meeting, if such date is different than the record date for determining shareholders entitled to notice of the meeting. If the board of directors has authorized participation by means of remote communication pursuant to section 33-703 for any class or series of shareholders, the notice to such class or series of shareholders shall describe the means of remote communication to be used. Unless sections 33-600 to 33-998, inclusive, or the certificate of incorporation requires otherwise, the corporation is required to give notice only to shareholders entitled to vote at the meeting as of the record date for determining the shareholders entitled to notice of the meeting.
(b) Unless sections 33-600 to 33-998, inclusive, or the certificate of incorporation requires otherwise, notice of an annual meeting need not include a description of the purpose or purposes for which the meeting is called.
(c) Notice of a special shareholders’ meeting shall include a description of the purpose or purposes for which the meeting is called.
(d) If not otherwise fixed under section 33-697 or 33-701, the record date for determining shareholders entitled to notice of and to vote at an annual or special shareholders’ meeting is the day before the first notice is delivered to shareholders.
(e) Unless the bylaws require otherwise, if an annual or special shareholders’ meeting is adjourned to a different date, time or place, if any, notice need not be given of the new date, time or place, if any, if the new date, time or place, if any, is announced at the meeting before adjournment. If a new record date for the adjourned meeting is or must be fixed under section 33-701, however, notice of the adjourned meeting must be given under this section to shareholders entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting.
(P.A. 94-186, S. 60, 215; P.A. 96-271, S. 49, 50, 254; P.A. 11-147, S. 1, 4; P.A. 21-39, S. 13.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 11-147 amended Subsec. (a) to require notice to include record date for determining shareholders entitled to vote at meeting if different than record date for determining shareholders entitled to notice of meeting, provide that if board of directors has authorized participation by means of remote communication for any class or series of shareholders, notice to such shareholders shall describe the means of remote communication to be used and provide that corporation is required to give notice only to shareholders entitled to vote at meeting “as of the record date for determining the shareholders entitled to notice of the meeting”, and amended Subsec. (e) to require notice of an adjourned meeting with a new record date to be given to “shareholders entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting”, rather than “persons who are shareholders as of the new record date”; P.A. 21-39 amended Subsec. (a) by adding provision re notification of place of meeting if meeting is to be held at a place and amended Subsec. (e) by adding “if any”, effective June 14, 2021.
Sec. 33-700. Waiver of notice. (a) A shareholder may waive any notice required by sections 33-600 to 33-998, inclusive, the certificate of incorporation or bylaws before or after the date and time stated in the notice. The waiver must be in writing, be signed by the shareholder entitled to the notice and be delivered to the corporation for inclusion in the minutes or filing with the corporate records.
(b) A shareholder’s attendance at a meeting: (1) Waives objection to lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting; (2) waives objection to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented.
(P.A. 94-186, S. 61, 215; P.A. 96-271, S. 51, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-701. Record date. (a) The bylaws may fix or provide the manner of fixing the record date or dates for one or more voting groups in order to determine the shareholders entitled to notice of a shareholders’ meeting, to demand a special meeting, to vote or to take any other action. If the bylaws do not fix or provide for fixing a record date, the board of directors of the corporation may fix a future date as the record date.
(b) A record date fixed under this section may not be more than seventy days before the meeting or action requiring a determination of shareholders.
(c) A determination of shareholders entitled to notice of or to vote at a shareholders’ meeting is effective for any adjournment of the meeting unless the board of directors fixes a new record date or dates, which it must do if the meeting is adjourned to a date more than one hundred twenty days after the date fixed for the original meeting.
(d) If a court orders a meeting adjourned to a date more than one hundred twenty days after the date fixed for the original meeting, it may provide that the original record date or dates continue in effect or it may fix a new record date or dates.
(e) The record date for a shareholders’ meeting fixed by or in the manner provided in the bylaws or by the board of directors shall be the record date for determining shareholders entitled both to notice of and to vote at the shareholders’ meeting, unless in the case of a record date fixed by the board of directors and to the extent not prohibited by the bylaws, the board, at the time it fixes the record date for shareholders entitled to notice of the meeting, fixes a later record date on or before the date of the meeting to determine the shareholders entitled to vote at the meeting.
(P.A. 94-186, S. 62, 215; P.A. 11-147, S. 5.)
History: P.A. 94-186 effective January 1, 1997; P.A. 11-147 amended Subsecs. (a), (c) and (d) to allow record “dates” to be fixed and added Subsec. (e) re authority of board to fix different record dates for determining shareholders entitled to notice of the meeting and shareholders entitled to vote at the meeting.
Sec. 33-702. Chairperson to preside. (a) At each meeting of shareholders, a chairperson shall preside. The chairperson shall be appointed as provided in the bylaws or, in the absence of such provision, by the board of directors.
(b) The chairperson, unless the certificate of incorporation or bylaws provide otherwise, shall determine the order of business and shall have the authority to establish rules for the conduct of the meeting.
(c) Any rules adopted for, and the conduct of, the meeting shall be fair to shareholders.
(d) The chairperson of the meeting shall announce at the meeting when the polls close for each matter voted upon. If no announcement is made, the polls shall be deemed to have closed upon the final adjournment of the meeting. After the polls close, no ballots, proxies or votes, nor any revocations or changes thereto, may be accepted.
(P.A. 98-137, S. 4, 62; 98-219, S. 33, 34.)
History: P.A. 98-137 effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section.
Sec. 33-703. Remote participation in annual and special meetings. (a) Shareholders of any class or series may participate in any meeting of shareholders by means of remote communication to the extent the board of directors authorizes such participation for such class or series. Participation by means of remote communication shall be subject to such guidelines and procedures as the board of directors adopts, and shall be in conformity with subsection (b) of this section.
(b) Shareholders participating in a shareholders’ meeting by means of remote communication shall be deemed present and may vote at such a meeting if the corporation has implemented reasonable measures: (1) To verify that each person participating remotely is a shareholder, and (2) to provide such shareholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the shareholders, including an opportunity to communicate, and to read or hear the proceedings of the meeting, substantially concurrent with such proceedings.
(c) Unless the bylaws require the meeting of shareholders to be held at a place, the board of directors may determine that any meeting of shareholders shall not be held at any place and shall instead be held solely by means of remote communication, provided the corporation implements the measures specified in subsection (b) of this section.
(P.A. 11-147, S. 2; P.A. 21-39, S. 14.)
History: P.A. 21-39 added Subsec. (c) re meetings held solely by means of remote communication, effective June 14, 2021.
(B)
VOTING
Sec. 33-704. Shareholders’ list for meeting. (a) After fixing a record date for a meeting, a corporation shall prepare an alphabetical list of the names of all its shareholders who are entitled to notice of a shareholders’ meeting. If the board of directors fixes a different record date under subsection (e) of section 33-701 to determine the shareholders entitled to vote at the meeting, a corporation also shall prepare an alphabetical list of the names of all its shareholders who are entitled to vote at the meeting. A list shall be arranged by voting group, and within each voting group by class or series of shares, and show the address of and number of shares held by each shareholder.
(b) The shareholders’ list for notice shall be available for inspection by any shareholder, beginning two business days after notice of the meeting is given for which the list was prepared and continuing through the meeting, (1) at the corporation’s principal office or at a place identified in the meeting notice in the city where the meeting will be held, or (2) on a reasonably accessible electronic network, provided the information required to gain access to such list is provided with the notice of the meeting. In the event that the corporation makes the list available on an electronic network, the corporation may take reasonable steps to ensure that such information is available only to shareholders of the corporation. A shareholders’ list for voting must be similarly available for inspection promptly after the record date for voting. A shareholder, his agent or attorney is entitled on written demand to inspect and, subject to the requirements of subsection (d) of section 33-946, to copy a list, during regular business hours and at his expense, during the period it is available for inspection.
(c) If the meeting is to be held at a place, the corporation shall make the list of shareholders entitled to vote available during the meeting, and any shareholder, his agent or attorney is entitled to inspect the list at any time during the meeting or any adjournment. If the meeting is to be held solely by means of remote communication, such list shall be open to inspection during the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.
(d) If the corporation refuses to allow a shareholder or his agent or attorney to inspect a shareholders’ list before or at the meeting, or copy a list as permitted by subsection (b) of this section, the superior court for the judicial district where a corporation’s principal office or, if none in this state, its registered office, is located, on application of the shareholder, may summarily order the inspection or copying at the corporation’s expense and may postpone the meeting for which the list was prepared until the inspection or copying is complete.
(e) Refusal or failure to prepare or make available a shareholders’ list does not affect the validity of action taken at the meeting.
(P.A. 94-186, S. 63, 215; P.A. 11-147, S. 6; P.A. 21-39, S. 15.)
History: P.A. 94-186 effective January 1, 1997; P.A. 11-147 amended Subsec. (a) to provide that if board fixes different record date for shareholders entitled to vote at meeting, a corporation also shall prepare alphabetical list of names of all shareholders entitled to vote at the meeting, amended Subsec. (b) to make existing provision re availability of list applicable to the shareholders’ list “for notice”, add provision requiring shareholders’ list for voting to be similarly available for inspection promptly after record date for voting and make technical and conforming changes, amended Subsec. (c) to replace “the shareholders’ list” with “the list of shareholders entitled to vote” and amended Subsecs. (d) and (e) to make conforming changes; P.A. 21-39 amended Subsec. (b) by adding Subdiv. (1) designator and adding Subdiv. (2) re shareholders’ list on electronic network and amended Subsec. (c) by replacing “The” with “If the meeting is to be held at a place, the”, adding provision re meeting held solely by means of remote communication and making a technical change, effective June 14, 2021.
Sec. 33-705. Voting entitlement of shares. (a) Except as provided in subsections (b) and (c) of this section or unless the certificate of incorporation provides otherwise, each outstanding share, regardless of class, is entitled to one vote on each matter voted on at a shareholders’ meeting.
(b) Absent special circumstances, the shares of a corporation are not entitled to vote if they are owned, directly or indirectly, by a second corporation, domestic or foreign, and the first corporation owns, directly or indirectly, a majority of the shares entitled to vote for directors of the second corporation.
(c) Subsection (b) of this section does not limit the power of a corporation to vote any shares, including its own shares, held by it in a fiduciary capacity.
(d) Redeemable shares are not entitled to vote after notice of redemption is mailed to the holders and a sum sufficient to redeem the shares has been deposited with a bank, trust company or other financial institution under an irrevocable obligation to pay the holders the redemption price on surrender of the shares.
(e) A corporation may, by provision in its certificate of incorporation, confer upon holders of any debt securities issued or to be issued by the corporation, whether or not secured by mortgage or otherwise, such voting rights in respect of the corporate affairs and management of the corporation as may be therein provided.
(P.A. 94-186, S. 64, 215; P.A. 96-271, S. 52, 53, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
Sec. 33-706. Proxies. (a) A shareholder may vote his shares in person or by proxy.
(b) A shareholder or his agent or attorney-in-fact may appoint a proxy to vote or otherwise act for the shareholder by signing an appointment form or by an electronic transmission of the appointment. An electronic transmission of the appointment must contain or be accompanied by information from which one can determine that a shareholder or his agent or attorney-in-fact authorized the electronic transmission.
(c) An appointment of a proxy is effective when a signed appointment form or an electronic transmission of the appointment that conforms with the requirements of subsection (b) of this section is received by the inspector of election or the officer or agent of the corporation authorized to tabulate votes. A photographic or similar reproduction of an appointment, or a telegram, cablegram, facsimile transmission, wireless or similar transmission of an appointment received by such person shall be sufficient to effect such appointment. An appointment of a proxy is valid for eleven months unless a longer period is expressly provided in the appointment.
(d) An appointment of a proxy is revocable unless the appointment form or electronic transmission of the appointment states that it is irrevocable and the appointment is coupled with an interest. Appointments coupled with an interest include the appointment of: (1) A pledgee; (2) a person who purchased or agreed to purchase the shares; (3) a creditor of the corporation who extended it credit under terms requiring the appointment; (4) an employee of the corporation whose employment contract requires the appointment; or (5) a party to a voting agreement created under section 33-716.
(e) The death or incapacity of the shareholder appointing a proxy does not affect the right of the corporation to accept the proxy’s authority unless notice of the death or incapacity is received by the secretary or other officer or agent authorized to tabulate votes before the proxy exercises his authority under the appointment.
(f) An appointment of a proxy made irrevocable under subsection (d) of this section is revoked when the interest with which it is coupled is extinguished.
(g) Unless an appointment of a proxy otherwise provides, an appointment made irrevocable under subsection (d) of this section continues in effect after a transfer of the shares and a transferee takes subject to the appointment, except that a transferee for value of shares subject to an irrevocable appointment may revoke the appointment if he did not know of its existence when he acquired the shares and the existence of the irrevocable appointment was not noted conspicuously on the certificate representing the shares or on the information statement for shares without certificates.
(h) Subject to section 33-708 and to any express limitation on the proxy’s authority stated in the appointment form or electronic transmission of the appointment, a corporation is entitled to accept the proxy’s vote or other action as that of the shareholder making the appointment.
(P.A. 94-186, S. 65, 215; P.A. 98-137, S. 5, 62; 98-219, S. 33, 34; P.A. 11-147, S. 15; P.A. 15-48, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 98-137 amended Subsec. (b) to authorize the agent or attorney-in-fact of a shareholder to appoint a proxy, provide that the appointment is accomplished “by signing an appointment form or by an electronic transmission of the appointment” rather than “by signing an appointment form, either personally or by his attorney-in-fact” and require that an electronic transmission contain or be accompanied by information from which one can determine that the shareholder, the shareholder’s agent or the shareholder’s attorney-in-fact authorized the electronic transmission, amended Subsec. (c) to provide that an appointment of a proxy is effective “when a signed appointment form or an electronic transmission of the appointment is received by the inspector of election or the officer or agent of the corporation authorized to tabulate votes” rather than “when received by the secretary or other officer or agent authorized to tabulate votes”, amended Subsec. (d) to provide that an appointment of a proxy is revocable “unless the appointment form or electronic transmission of the appointment states that it is irrevocable” rather than “by the shareholder unless the appointment form conspicuously states that it is irrevocable”, and amended Subsec. (h) to make acceptance by the corporation of the proxy’s vote or action subject “to any express limitation on the proxy’s authority stated in the appointment form or electronic transmission of the appointment” rather than “to any express limitation on the proxy’s authority appearing on the face of the appointment form”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 11-147 amended Subsec. (b) to delete provision re electronic transmission must contain or be accompanied by information from which one can determine that it was authorized by the shareholder, shareholder’s agent or shareholder’s attorney-in-fact; P.A. 15-48 amended Subsec. (b) to require electronic transmission of appointment to contain or be accompanied by information from which one can determine that the electronic transmission was authorized, amended Subsec. (c) to add provision re electronic transmission of appointment to conform with requirements of Subsec. (b) and to change “appointment” to “appointment of a proxy”, amended Subsec. (f) to change “appointment” to “appointment of a proxy” and amended Subsec. (g) to provide that appointment of proxy made irrevocable under Subsec. (d) continues in effect after transfer of shares unless otherwise provided in such appointment.
Sec. 33-707. Shares held by nominees. (a) A corporation may establish a procedure by which the beneficial owner of shares that are registered in the name of a nominee is recognized by the corporation as the shareholder. The extent of this recognition may be determined in the procedure.
(b) The procedure may set forth: (1) The types of nominees to which it applies; (2) the rights or privileges that the corporation recognizes in a beneficial owner; (3) the manner in which the procedure is selected by the nominee; (4) the information that must be provided when the procedure is selected; (5) the period for which selection of the procedure is effective; and (6) other aspects of the rights and duties created.
(P.A. 94-186, S. 66, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-708. Corporation’s acceptance or rejection of votes. (a) If the name signed on a vote, consent, waiver or proxy appointment corresponds to the name of a shareholder, the corporation if acting in good faith is entitled to accept the vote, consent, waiver or proxy appointment and give it effect as the act of the shareholder.
(b) If the name signed on a vote, consent, waiver or proxy appointment does not correspond to the name of its shareholder, the corporation if acting in good faith is nevertheless entitled to accept the vote, consent, waiver or proxy appointment and give it effect as the act of the shareholder if:
(1) The shareholder is an entity and the name signed purports to be that of an officer or agent of the entity;
(2) The name signed purports to be that of an administrator, executor, guardian or conservator representing the shareholder and, if the corporation requests, evidence of fiduciary status acceptable to the corporation has been presented with respect to the vote, consent, waiver or proxy appointment;
(3) The name signed purports to be that of a receiver or trustee in bankruptcy of the shareholder and, if the corporation requests, evidence of this status acceptable to the corporation has been presented with respect to the vote, consent, waiver or proxy appointment;
(4) The name signed purports to be that of a pledgee, beneficial owner or attorney-in-fact of the shareholder and, if the corporation requests, evidence acceptable to the corporation of the signatory’s authority to sign for the shareholder has been presented with respect to the vote, consent, waiver or proxy appointment;
(5) Two or more persons are the shareholder as cotenants or fiduciaries and the name signed purports to be the name of at least one of the co-owners and the person signing appears to be acting on behalf of all the co-owners.
(c) The corporation is entitled to reject a vote, consent, waiver or proxy appointment if the secretary or other officer or agent authorized to tabulate votes, acting in good faith, has reasonable basis for doubt about the validity of the signature on it or about the signatory’s authority to sign for the shareholder.
(d) The corporation and its officer or agent who accepts or rejects a vote, consent, waiver or proxy appointment in good faith and in accordance with the standards of this section or subsection (b) of section 33-706 are not liable in damages to the shareholder for the consequences of the acceptance or rejection.
(e) Corporate action based on the acceptance or rejection of a vote, consent, waiver or proxy appointment under this section or subsection (b) of section 33-706 is valid unless a court of competent jurisdiction determines otherwise.
(P.A. 94-186, S. 67, 215; P.A. 98-137, S. 6, 62; 98-219, S. 33, 34.)
History: P.A. 94-186 effective January 1, 1997; P.A. 98-137 amended Subsecs. (d) and (e) to add reference to Sec. 33-706(b), effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section.
Sec. 33-709. Quorum and voting requirements for voting groups. (a) Shares entitled to vote as a separate voting group may take action on a matter at a meeting only if a quorum of those shares exists with respect to that matter. Unless the certificate of incorporation or sections 33-600 to 33-998, inclusive, provide otherwise, a majority of the votes entitled to be cast on the matter by the voting group constitutes a quorum of that voting group for action on that matter.
(b) Once a share is represented for any purpose at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that adjourned meeting.
(c) If a quorum exists, action on a matter, other than the election of directors, by a voting group is approved if the votes cast within the voting group favoring the action exceed the votes cast opposing the action, unless the certificate of incorporation or sections 33-600 to 33-998, inclusive, require a greater number of affirmative votes.
(d) An amendment of the certificate of incorporation adding, changing or deleting a quorum or voting requirement for a voting group greater than specified in subsection (a) or (c) of this section is governed by section 33-711.
(e) The election of directors is governed by section 33-712.
(f) Whenever a provision of sections 33-600 to 33-998, inclusive, provides for voting of classes or series as separate voting groups, the rules provided in subsection (c) of section 33-798 for amendments of the certificate of incorporation apply to that provision.
(P.A. 94-186, S. 68, 215; P.A. 96-271, S. 54, 254; P.A. 12-32, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 12-32 added Subsec. (f) re provisions providing for voting of classes or series as separate voting groups.
Sec. 33-710. Action by single and multiple voting groups. (a) If the certificate of incorporation or sections 33-600 to 33-998, inclusive, provide for voting by a single voting group on a matter, action on that matter is taken when voted upon by that voting group as provided in section 33-709.
(b) If the certificate of incorporation or sections 33-600 to 33-998, inclusive, provide for voting by two or more voting groups on a matter, action on that matter is taken only when voted upon by each of those voting groups counted separately as provided in section 33-709. Action may be taken by one voting group on a matter even though no action is taken by another voting group entitled to vote on the matter.
(P.A. 94-186, S. 69, 215; P.A. 96-271, S. 55, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
Sec. 33-711. Greater quorum or voting requirement. (a) The certificate of incorporation may provide for a greater quorum or voting requirement for shareholders, or voting groups of shareholders, than is provided for by sections 33-600 to 33-998, inclusive.
(b) An amendment to the certificate of incorporation that adds, changes or deletes a greater quorum or voting requirement must meet the same quorum requirement and be adopted by the same vote and voting groups required to take action under the quorum and voting requirements then in effect or proposed to be adopted, whichever is greater.
(P.A. 94-186, S. 70, 215; P.A. 96-271, S. 56, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
Sec. 33-712. Voting for directors. Cumulative voting. (a) Unless otherwise provided in the certificate of incorporation, directors are elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present.
(b) Shareholders do not have a right to cumulate their votes for directors unless the certificate of incorporation so provides.
(c) A statement included in the certificate of incorporation that “all or a designated voting group of shareholders are entitled to cumulate their votes for directors”, or words of similar import, means that the shareholders designated are entitled to multiply the number of votes they are entitled to cast by the number of directors for whom they are entitled to vote and cast the product for a single candidate or distribute the product among two or more candidates.
(d) Shares otherwise entitled to vote cumulatively may not be voted cumulatively at a particular meeting unless: (1) The meeting notice or proxy statement accompanying the notice states conspicuously that cumulative voting is authorized; or (2) a shareholder who has the right to cumulate votes gives notice to the corporation not less than forty-eight hours before the time set for the meeting of the shareholder’s intent to cumulate votes during the meeting, and, if one shareholder gives this notice, all other shareholders in the same voting group participating in the election are entitled to cumulate their votes without giving further notice.
(P.A. 94-186, S. 71, 215; P.A. 96-271, S. 57, 254; P.A. 09-55, S. 7.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 09-55 amended Subsec. (d) to make technical changes.
Sec. 33-713. Inspectors. (a) A corporation having any 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 shall, and any other corporation may, appoint one or more inspectors to act at a meeting of shareholders and make a written report of the inspectors’ determinations. Each inspector shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of the inspector’s ability.
(b) The inspectors shall (1) ascertain the number of shares outstanding and the voting power of each; (2) determine the shares represented at a meeting; (3) determine the validity of proxies and ballots; (4) count all votes; and (5) determine the result.
(c) An inspector may be an officer or employee of the corporation.
(P.A. 98-137, S. 7, 62; 98-219, S. 33, 34.)
History: P.A. 98-137 effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section.
Sec. 33-714. Reserved for future use.
(C)
VOTING TRUSTS AND AGREEMENTS
Sec. 33-715. Voting trust. (a) One or more shareholders may create a voting trust, conferring on a trustee the right to vote or otherwise act for them, by signing an agreement setting out the provisions of the trust, which may include anything consistent with its purpose, and transferring their shares to the trustee. When a voting trust agreement is signed, the trustee shall prepare a list of the names and addresses of all voting trust beneficial owners, together with the number and class of shares each transferred to the trust, and deliver copies of the list and agreement to the corporation’s principal office.
(b) A voting trust becomes effective on the date the first shares subject to the trust are registered in the trustee’s name.
(c) Limits, if any, on the duration of a voting trust shall be as set forth in the voting trust, except that a voting trust that became effective on or before September 30, 2015, is valid for not more than ten years after its effective date unless such voting trust is: (1) Extended in accordance with the provisions of subsection (d) of this section; or (2) amended to provide otherwise by unanimous agreement of the parties to the voting trust.
(d) All or some of the parties to a voting trust in effect on or before September 30, 2015, may extend such voting trust for additional terms of not more than ten years each by signing an extension agreement and obtaining the voting trustee’s written consent to the extension. Such extension is valid for ten years from the date the first shareholder signs the extension agreement. The voting trustee must deliver copies of the extension agreement and list of beneficial owners to the corporation’s principal office. An extension agreement binds only those parties signing the extension agreement.
(P.A. 94-186, S. 72, 215; P.A. 15-48, S. 2.)
History: P.A. 94-186 effective January 1, 1997; P.A. 15-48 made a technical change in Subsec. (a), amended Subsec. (b) by deleting provision re voting trust is valid for not more than 10 years after its effective date, deleted former Subsec. (c) re extension of voting trust, added new Subsec. (c) re durational limits of voting trust as set forth in the voting trust, and added Subsec. (d) re process for extending durational limits of voting trust in effect on or before September 30, 2015.
Sec. 33-716. Voting agreement. (a) Two or more shareholders may provide for the manner in which they will vote their shares by signing an agreement for that purpose. A voting agreement created under this section is not subject to the provisions of section 33-715.
(b) A voting agreement created under this section is specifically enforceable.
(P.A. 94-186, S. 73, 215.)
History: P.A. 94-286 effective January 1, 1997.
Sec. 33-717. Shareholder agreement. (a) An agreement among the shareholders of a corporation that complies with this section is effective among the shareholders and the corporation even though it is inconsistent with one or more other provisions of sections 33-600 to 33-998, inclusive, in that it:
(1) Eliminates the board of directors or restricts the discretion or powers of the board of directors;
(2) Governs the authorization or making of distributions whether or not in proportion to ownership of shares, subject to the limitations in section 33-687;
(3) Establishes who shall be directors or officers of the corporation, or their terms of office or manner of selection or removal;
(4) Governs, in general or in regard to specific matters, the exercise or division of voting power by or between the shareholders and directors or by or among any of them, including use of weighted voting rights or director proxies;
(5) Establishes the terms and conditions of any agreement for the transfer or use of property or the provision of services between the corporation and any shareholder, director, officer or employee of the corporation or among any of them;
(6) Transfers to one or more shareholders or other persons all or part of the authority to exercise the corporate powers or to manage the business and affairs of the corporation, including the resolution of any issue about which there exists a deadlock among directors or shareholders;
(7) Requires dissolution of the corporation at the request of one or more of the shareholders or upon the occurrence of a specified event or contingency; or
(8) Otherwise governs the exercise of the corporate powers or the management of the business and affairs of the corporation or the relationship among the shareholders, the directors and the corporation, or among any of them, and is not contrary to public policy.
(b) An agreement authorized by this section shall be: (1) Set forth (A) in the certificate of incorporation or bylaws and approved by all persons who are shareholders at the time of the agreement or (B) in a written agreement that is signed by all persons who are shareholders at the time of the agreement and is made known to the corporation; and (2) subject to amendment only by all persons who are shareholders at the time of the amendment, unless the agreement provides otherwise.
(c) The existence of any agreement authorized by this section shall be noted conspicuously on the front or back of each certificate for outstanding shares or on the information statement required by subsection (b) of section 33-677. If at the time of the agreement the corporation has shares outstanding represented by certificates, the corporation shall recall the outstanding certificates and issue substitute certificates that comply with this subsection. The failure to note the existence of the agreement on the certificate or information statement shall not affect the validity of the agreement or any action taken pursuant to it. Any purchaser of shares who, at the time of purchase, did not have knowledge of the existence of the agreement shall be entitled to rescission of the purchase. A purchaser shall be deemed to have knowledge of the existence of the agreement if its existence is noted on the certificate or information statement for the shares in compliance with this subsection and, if the shares are not represented by a certificate, the information statement is delivered to the purchaser at or prior to the time of purchase of the shares. An action to enforce the right of rescission authorized by this subsection must be commenced within the earlier of ninety days after discovery of the existence of the agreement or two years after the time of purchase of the shares.
(d) An agreement authorized by this section shall cease to be effective when the corporation becomes a public corporation. If the agreement ceases to be effective for any reason, the board of directors may, if the agreement is contained or referred to in the corporation’s certificate of incorporation or bylaws, adopt an amendment to the certificate of incorporation or bylaws, without shareholder action, to delete the agreement and any references to it.
(e) An agreement authorized by this section that limits the discretion or powers of the board of directors shall relieve the directors of, and impose upon the person or persons in whom such discretion or powers are vested, liability for acts or omissions imposed by law on directors to the extent that the discretion or powers of the directors are limited by the agreement.
(f) The existence or performance of an agreement authorized by this section shall not be a ground for imposing personal liability on any shareholder for the acts or debts of the corporation even if the agreement or its performance treats the corporation as if it were a partnership or results in failure to observe the corporate formalities otherwise applicable to the matters governed by the agreement.
(g) Incorporators or subscribers for shares may act as shareholders with respect to an agreement authorized by this section if no shares have been issued when the agreement is made.
(h) Limits, if any, on the duration of an agreement authorized by this section shall be as set forth in the agreement, except that such an agreement in effect on or before September 30, 2015, is valid for ten years unless the agreement provides otherwise.
(P.A. 94-186, S. 74, 215; P.A. 96-271, S. 58, 59, 254; P.A. 06-68, S. 3; P.A. 15-48, S. 3.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 06-68 amended Subsec. (d) by replacing “when shares of the corporation are 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” with “when the corporation becomes a public corporation”; P.A. 15-48 amended Subsec. (b) by deleting former Subdiv. (3) re agreement to be valid for 10 years unless agreement otherwise provides and added Subsec. (h) re durational limits on agreements.
Board of directors resolution setting forth parameters of electing a board of directors held to be valid shareholder agreement under section. 72 CA 426.
Secs. 33-718 and 33-719. Reserved for future use.
(D)
DERIVATIVE PROCEEDINGS
Sec. 33-720. Derivative proceedings. Definitions. As used in sections 33-720 to 33-727, inclusive:
(1) “Derivative proceeding” means a civil suit in the right of a domestic corporation or, to the extent provided in section 33-727, in the right of a foreign corporation.
(2) “Shareholder” includes a beneficial owner whose shares are held in a voting trust or held by a nominee on the beneficial owner’s behalf.
(P.A. 94-186, S. 75, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-721. Standing. A shareholder may not commence or maintain a derivative proceeding unless the shareholder: (1) Was a shareholder of the corporation at the time of the act or omission complained of or became a shareholder through transfer by operation of law from one who was a shareholder at that time; and (2) fairly and adequately represents the interests of the corporation in enforcing the right of the corporation.
(P.A. 94-186, S. 76, 215.)
History: P.A. 94-186 effective January 1, 1997.
Defendant who is no longer a shareholder in the corporation cannot maintain a derivative action on its behalf. 104 CA 810.
Sec. 33-722. Demand. No shareholder may commence a derivative proceeding until: (1) A written demand has been made upon the corporation to take suitable action; and (2) ninety days have expired from the date delivery of the demand was made unless the shareholder has earlier been notified that the demand has been rejected by the corporation or unless irreparable injury to the corporation would result by waiting for the expiration of the ninety-day period.
(P.A. 94-186, S. 77, 215; P.A. 11-147, S. 16.)
History: P.A. 94-186 effective January 1, 1997; P.A. 11-147 amended Subdiv. (2) to replace “the date the demand was made” with “the date delivery of the demand was made”.
Sec. 33-723. Stay of proceedings. If the corporation commences an inquiry into the allegations made in the demand or complaint, the court may stay any derivative proceeding for such period as the court deems appropriate.
(P.A. 94-186, S. 78, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-724. Dismissal. (a) A derivative proceeding shall be dismissed by the court on motion by the corporation if one of the groups specified in subsection (b) or (e) of this section has determined in good faith, after conducting a reasonable inquiry upon which its conclusions are based, that the maintenance of the derivative proceeding is not in the best interests of the corporation.
(b) Unless a panel is appointed pursuant to subsection (e) of this section, the determination in subsection (a) of this section shall be made by:
(1) A majority vote of qualified directors present at a meeting of the board of directors if the qualified directors constitute a quorum; or
(2) A majority vote of a committee consisting of two or more qualified directors appointed by majority vote of qualified directors present at a meeting of the board of directors, regardless of whether such qualified directors constitute a quorum.
(c) If a derivative proceeding is commenced after a determination has been made rejecting a demand by a shareholder, the complaint shall allege with particularity facts establishing either (1) that a majority of the board of directors did not consist of qualified directors at the time the determination was made, or (2) that the requirements of subsection (a) of this section have not been met.
(d) If a majority of the board of directors consisted of qualified directors at the time the determination was made, the plaintiff shall have the burden of proving that the requirements of subsection (a) of this section have not been met. If a majority of the board of directors did not consist of qualified directors at the time the determination was made, the corporation shall have the burden of proving that the requirements of subsection (a) of this section have been met.
(e) Upon motion by the corporation, the court may appoint a panel of one or more individuals to make a determination whether the maintenance of the derivative proceeding is in the best interests of the corporation. In such case, the plaintiff shall have the burden of proving that the requirements of subsection (a) of this section have not been met.
(P.A. 94-186, S. 79, 215; P.A. 06-68, S. 4.)
History: P.A. 94-186 effective January 1, 1997; P.A. 06-68 replaced references to “independent directors” with references to “qualified directors” and made technical and conforming changes throughout section, deleted former Subsec. (c) re factors which did not by themselves cause a director to be considered not independent, redesignated existing Subsecs. (d) to (f) as Subsecs. (c) to (e) and amended redesignated Subsec. (e) by replacing reference to “independent persons” with reference to “individuals”.
Dismissal of a derivative proceeding under section, which is substantially similar to Sec. 7.44 of the Model Business Corporation Act, presents a mixed question of fact and law and is subject to plenary review; conclusory allegation in complaint was insufficient to meet the particularity standard required of plaintiff in Subsec. (c); section embodies the business judgment rule which restricts a court’s review of a corporate manager’s decision. 141 CA 486.
Sec. 33-725. Discontinuance or settlement. A derivative proceeding may not be discontinued or settled without the court’s approval. If the court determines that a proposed discontinuance or settlement will substantially affect the interests of the corporation’s shareholders or a class of shareholders, the court shall direct that notice be given to the shareholders affected.
(P.A. 94-186, S. 80, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-726. Payment of expenses. On termination of the derivative proceeding the court may:
(1) Order the corporation to pay the plaintiff’s expenses incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefit to the corporation;
(2) Order the plaintiff to pay any defendant’s expenses incurred in defending the proceeding if it finds that the proceeding was commenced or maintained without reasonable cause or for an improper purpose; or
(3) Order a party to pay an opposing party’s expenses incurred because of the filing of a pleading, motion or other paper, if it finds that the pleading, motion or other paper was not well grounded in fact, after reasonable inquiry, or warranted by existing law or a good faith argument for the extension, modification or reversal of existing law and was interposed for an improper purpose, such as to harass or cause unnecessary delay or needless increase in the cost of litigation.
(P.A. 94-186, S. 81, 215; P.A. 96-271, S. 60, 254; P.A. 09-55, S. 18.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “counsel” fees with “attorney’s” fees where appearing, effective January 1, 1997; P.A. 09-55 replaced “reasonable expenses, including attorney’s fees” with “expenses” throughout and made a technical change in Subdiv. (3).
Sec. 33-727. Applicability to foreign corporations. In any derivative proceeding in the right of a foreign corporation, the matters covered by sections 33-720 to 33-727, inclusive, shall be governed by the laws of the jurisdiction of incorporation of the foreign corporation except for sections 33-723, 33-725 and 33-726.
(P.A. 94-186, S. 82, 215.)
History: P.A. 94-186 effective January 1, 1997.
Secs. 33-728 to 33-734. Reserved for future use.
PART VIII
DIRECTORS AND OFFICERS
(A)
BOARD OF DIRECTORS
Sec. 33-735. Requirements for and duties of board of directors. (a) Except as provided in section 33-717, each corporation shall have a board of directors.
(b) All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation managed by or under the direction of, its board of directors, subject to any limitation set forth in the certificate of incorporation or in an agreement authorized under section 33-717.
(P.A. 94-186, S. 83, 215; P.A. 96-271, S. 61, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-736. Qualifications for directors or nominees for directors. (a) The certificate of incorporation or bylaws may prescribe qualifications for directors or nominees for directors. Qualifications for directors or nominees for directors shall be lawful and reasonable as applied to the corporation.
(b) A requirement that is based on a past, current or prospective action, or expression of an opinion, by a nominee or director that could limit the ability of a nominee or director to discharge his or her duties as a director is not a permissible qualification under this section; except that a qualification may include not being or having been subject to specified criminal, civil or regulatory sanctions or not having been removed as a director by judicial action or for cause.
(c) A director need not be a resident of this state or a shareholder of the corporation unless the certificate of incorporation or bylaws so prescribe.
(d) A qualification for nomination for director prescribed before a person’s nomination shall apply to such person at the time of nomination. A qualification for nomination for director prescribed after a person’s nomination shall not apply to such person with respect to such nomination.
(e) A qualification for director prescribed before the start of a director’s term may apply only at the time an individual becomes a director or may apply during a director’s term. A qualification prescribed during a director’s term shall not apply to that director before the end of that term.
(P.A. 94-186, S. 84, 215; P.A. 96-271, S. 62, 254; P.A. 15-48, S. 4.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 15-48 replaced former provisions re certificate of incorporation or bylaws prescribing qualifications for directors with Subsecs. (a) to (e) re certificate of incorporation or bylaws prescribing qualifications for directors or nominees for directors.
Sec. 33-737. Number and election of directors. (a) A board of directors shall consist of one or more individuals, with the number specified in or fixed in accordance with the certificate of incorporation or bylaws.
(b) The number of directors may be increased or decreased from time to time by amendment to, or in the manner provided in, the certificate of incorporation or the bylaws.
(c) Directors are elected at the first annual shareholders’ meeting and at each annual meeting thereafter unless their terms are staggered under section 33-740.
(P.A. 94-186, S. 85, 215; P.A. 96-271, S. 63, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997.
See Sec. 33-809 re bylaw provisions re election of directors.
Sec. 33-738. Election of directors by certain classes of shareholders. If the certificate of incorporation authorizes dividing the shares into classes, the certificate may also authorize the election of all or a specified number of directors by the holders of one or more authorized classes of shares. A class, or classes, of shares entitled to elect one or more directors is a separate voting group for purposes of the election of directors.
(P.A. 94-186, S. 86, 215; P.A. 96-271, S. 64, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-739. Terms of directors generally. (a) The terms of the initial directors of a corporation expire at the first shareholders’ meeting at which directors are elected.
(b) The terms of all other directors expire at the next or, if their terms are staggered in accordance with section 33-740, at the applicable second, third, fourth or fifth, annual shareholders’ meeting following their election except to the extent (1) provided in section 33-809 if a bylaw electing to be governed by that section is in effect, or (2) a shorter term is specified in the certificate of incorporation in the event of a director nominee failing to receive a specified vote for election.
(c) A decrease in the number of directors does not shorten an incumbent director’s term.
(d) The term of a director elected to fill a vacancy expires at the next shareholders’ meeting at which directors are elected.
(e) Except to the extent otherwise provided in the certificate of incorporation or under section 33-809 if a bylaw electing to be governed by that section is in effect, despite the expiration of a director’s term, the director continues to serve until the director’s successor is elected and qualifies or until there is a decrease in the number of directors.
(P.A. 94-186, S. 87, 215; P.A. 09-55, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 09-55 amended Subsec. (b) to add provision re expiration of staggered terms “at the applicable second, third, fourth or fifth” annual shareholders’ meeting following director’s election and add exception re bylaw or certificate of incorporation provision and amended Subsec. (e) to add exception re certificate of incorporation or bylaw provision and make technical changes.
Sec. 33-740. Staggered terms for directors. The certificate of incorporation may provide for staggering the terms of directors by dividing the total number of directors into up to five groups, with each group containing approximately the same percentage of the total, as near as may be. In that event, the terms of directors in the first group expire at the first annual shareholders’ meeting after their election, the terms of the second group expire at the second annual shareholders’ meeting after their election, the terms of the third group, if any, expire at the third annual shareholders’ meeting after their election, the terms of the fourth group, if any, expire at the fourth annual shareholders’ meeting after their election and the terms of the fifth group, if any, expire at the fifth annual shareholders’ meeting after their election. At each annual shareholders’ meeting held thereafter, directors shall be chosen for a term of two years, three years, four years or five years, as the case may be, to succeed those whose terms expire.
(P.A. 94-186, S. 88, 215; P.A. 96-271, S. 65, 254; P.A. 01-199, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 01-199 deleted Subsec. (b) that made section applicable to a corporation with cumulative voting only if there are at least three directors in each group.
Sec. 33-741. Resignation of directors. (a) A director may resign at any time by delivering a written resignation to the board of directors or its chairperson or to the secretary of the corporation.
(b) A resignation is effective when the resignation is delivered unless the resignation specifies a later effective date or an effective date determined upon the happening of an event or events. A resignation that is conditioned upon failing to receive a specified vote for election as a director may provide that it is irrevocable.
(P.A. 94-186, S. 89, 215; P.A. 97-246, S. 84, 99; P.A. 09-55, S. 14.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to make technical changes, effective June 27, 1997; P.A. 09-55 amended Subsec. (a) to replace “written notice” with “a written resignation”, replace “chairman of the board of directors” with “its chairperson” and replace “the corporation” with “the secretary of the corporation” and amended Subsec. (b) to replace “notice” with “resignation”, add exception to resignation being effective upon delivery if resignation specifies “an effective date determined upon the happening of an event or events” and add provision re irrevocability of resignation conditioned upon failing to receive specified vote.
Sec. 33-742. Removal of directors by shareholders. (a) The shareholders may remove one or more directors with or without cause unless the certificate of incorporation provides that directors may be removed only for cause.
(b) If a director is elected by a voting group of shareholders only the shareholders of that voting group may participate in the vote to remove him.
(c) If cumulative voting is authorized, a director may not be removed if the number of votes sufficient to elect him under cumulative voting is voted against his removal. If cumulative voting is not authorized, a director may be removed only if the number of votes cast to remove him exceeds the number of votes cast not to remove him.
(d) A director may be removed by the shareholders only at a meeting called for the purpose of removing him and the meeting notice must state that the purpose, or one of the purposes, of the meeting is removal of the director.
(P.A. 94-186, S. 90, 215; P.A. 96-271, S. 66, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-743. Removal of directors by judicial proceeding. (a) The superior court for the judicial district where a corporation’s principal office or, if none in this state, its registered office, is located may remove a director of the corporation from office in a proceeding commenced either by or in the right of the corporation if the court finds that (1) the director engaged in fraudulent or dishonest conduct with respect to the corporation or its shareholders, grossly abused the position of director or intentionally inflicted harm on the corporation, and (2) considering the director’s course of conduct and the inadequacy of other available remedies, removal would be in the best interest of the corporation.
(b) A shareholder proceeding on behalf of the corporation under subsection (a) of this section shall comply with all of the requirements of sections 33-720 to 33-727, inclusive, except subdivision (1) of section 33-721.
(c) The court, in addition to removing a director, may bar the director from reelection for a period prescribed by the court.
(d) Nothing in this section limits the equitable powers of the court to order other relief.
(P.A. 94-186, S. 91, 215; P.A. 03-18, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by adding provision re proceeding commenced in the right of the corporation, deleting provision re shareholders holding at least 10% of the outstanding shares of any class, replacing in Subdiv. (1) provision re gross abuse of authority or discretion with provisions re fraudulent or dishonest conduct with respect to shareholders, gross abuse of position of director and intentional infliction of harm on the corporation, and adding in Subdiv. (2) provision re consideration of director’s course of conduct and inadequacy of other available remedies in finding that removal would be in the best interest of the corporation, added new Subsec. (b) re shareholder proceeding on behalf of the corporation, redesignated existing Subsec. (b) as new Subsec. (c), replacing “that removes” with “in addition to removing” and making technical changes therein, deleted former Subsec. (c) re corporation as party defendant in shareholder proceeding, and added Subsec. (d) re equitable powers of court to order other relief, effective July 1, 2003.
Sec. 33-744. Vacancy on board of directors. (a) Unless the certificate of incorporation provides otherwise, if a vacancy occurs on a board of directors, including a vacancy resulting from an increase in the number of directors: (1) The shareholders may fill the vacancy; (2) the board of directors may fill the vacancy; or (3) if the directors remaining in office constitute fewer than a quorum of the board, they may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office.
(b) If the vacant office was held by a director elected by a voting group of shareholders, only the holders of shares of that voting group are entitled to vote to fill the vacancy if it is filled by the shareholders, and only the directors elected by that voting group are entitled to fill the vacancy if it is filled by the directors.
(c) A vacancy that will occur at a specific later date, by reason of a resignation effective at a later date under subsection (b) of section 33-741 or otherwise, may be filled before the vacancy occurs but the new director may not take office until the vacancy occurs.
(P.A. 94-186, S. 92, 215; P.A. 96-271, S. 67, 254; P.A. 09-55, S. 15.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 09-55 amended Subsec. (b) to add “only the directors elected by that voting group are entitled to fill the vacancy if it is filled by the directors”.
Sec. 33-745. Compensation of directors. Unless the certificate of incorporation or a bylaw provides otherwise, the board of directors may fix the compensation of directors.
(P.A. 94-186, S. 93, 215; P.A. 96-271, S. 68, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation and “bylaws” with “a bylaw”, effective January 1, 1997.
Secs. 33-746 and 33-747. Reserved for future use.
(B)
MEETINGS AND ACTION OF THE BOARD
Sec. 33-748. Meetings. (a) The board of directors may hold regular or special meetings in or out of this state.
(b) Unless the certificate of incorporation or a bylaw provides otherwise, the board of directors may permit any or all directors to participate in a regular or special meeting by, or conduct the meeting through the use of, any means of communication by which all directors participating may simultaneously hear each other during the meeting. A director participating in a meeting by this means is deemed to be present in person at the meeting.
(P.A. 94-186, S. 94, 215; P.A. 96-271, S. 69, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation and “bylaws” with “a bylaw”, effective January 1, 1997.
Sec. 33-749. Action without meeting. (a) Except to the extent that the certificate of incorporation or bylaws specifically require that action by the board of directors be taken only at a meeting, action required or permitted by sections 33-600 to 33-998, inclusive, to be taken by the board of directors may be taken without a meeting if each director signs a consent describing the action taken or to be taken and delivers it to the corporation.
(b) Action taken under this section is the act of the board of directors when one or more consents signed by all the directors are delivered to the corporation. The consent may specify the time at which the action taken thereunder is to be effective. A director’s consent may be withdrawn by a revocation signed by the director and delivered to the corporation prior to delivery to the corporation of unrevoked written consents signed by all the directors.
(c) A consent signed under this section has the effect of action taken at a meeting of the board of directors and may be described as such in any document.
(P.A. 94-186, S. 95, 215; P.A. 96-271, S. 70, 254; P.A. 01-199, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and “bylaws” with “a bylaw”, effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to rephrase provisions, delete requirement that action be taken “by all members of the board”, delete requirement that consents be “included in the minutes or filed with the corporate records reflecting the action taken”, require that each consent describe the action taken “or to be taken” and require that each consent be delivered to the corporation, amended Subsec. (b) to replace provision that action taken without a meeting “is effective when the last director signs the consent, unless the consent specifies a different effective date” with provisions that such action “is the act of the board of directors when one or more consents signed by all the directors are delivered to the corporation” and that consent “may specify the time at which the action taken thereunder is to be effective” and authorize a consent to be withdrawn by a revocation signed by the director and delivered to the corporation prior to the delivery of unrevoked written consents signed by all the directors and amended Subsec. (c) to replace provision that a consent “has the effect of a meeting vote” with “has the effect of action taken at a meeting of the board of directors”.
Sec. 33-750. Notice of meeting. (a) Unless the certificate of incorporation or a bylaw provides otherwise, regular meetings of the board of directors may be held without notice of the date, time, place or purpose of the meeting.
(b) Unless the certificate of incorporation or a bylaw provides for a longer or shorter period, special meetings of the board of directors shall be preceded by at least two days’ notice of the date, time and place of the meeting. The notice need not describe the purpose of the special meeting unless required by the certificate of incorporation or bylaws.
(P.A. 94-186, S. 96, 215; P.A. 96-271, S. 71, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation and “bylaws” with “a bylaw” where appearing, effective January 1, 1997.
Sec. 33-751. Waiver of notice. (a) A director may waive any notice required by sections 33-600 to 33-998, inclusive, the certificate of incorporation or bylaws before or after the date and time stated in the notice. Except as provided by subsection (b) of this section, the waiver shall be in writing, signed by the director entitled to the notice and filed with the minutes or corporate records.
(b) A director’s attendance at or participation in a meeting waives any required notice to him of the meeting unless the director at the beginning of the meeting, or promptly upon his arrival, objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting.
(P.A. 94-186, S. 97, 215; P.A. 96-271, S. 72, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-752. Quorum and voting. (a) Unless the certificate of incorporation or a bylaw requires a greater number or unless otherwise specifically provided in sections 33-770 to 33-779, inclusive, a quorum of a board of directors consists of: (1) A majority of the fixed number of directors if the corporation has a fixed board size; or (2) a majority of the number of directors prescribed or, if no number is prescribed, the number in office immediately before the meeting begins, if the corporation has a variable-range size board.
(b) The certificate of incorporation or bylaws may authorize a quorum of a board of directors to consist of no fewer than one-third of the fixed or prescribed number of directors determined under subsection (a) of this section.
(c) If a quorum is present when a vote is taken, the affirmative vote of a majority of directors present is the act of the board of directors unless the certificate of incorporation or a bylaw requires the vote of a greater number of directors.
(d) A director who is present at a meeting of the board of directors or a committee of the board of directors when corporate action is taken is deemed to have assented to the action taken unless: (1) He objects at the beginning of the meeting, or promptly upon his arrival, to holding it or transacting business at the meeting; (2) his dissent or abstention from the action taken is entered in the minutes of the meeting; or (3) he delivers written notice of his dissent or abstention to the presiding officer of the meeting before its adjournment or to the corporation immediately after adjournment of the meeting. The right of dissent or abstention is not available to a director who votes in favor of the action taken.
(P.A. 94-186, S. 98, 215; P.A. 96-271, S. 73, 254; P.A. 97-246, S. 11, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, replaced “bylaws” with “a bylaw” in Subsecs. (a) and (c) and made technical changes, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to add “or unless otherwise specifically provided in sections 33-770 to 33-779, inclusive,”, effective June 27, 1997.
Sec. 33-753. Committees. (a) Unless sections 33-600 to 33-998, inclusive, the certificate of incorporation or the bylaws provide otherwise, a board of directors may create one or more committees and appoint one or more members of the board of directors to serve on any such committee.
(b) Unless sections 33-600 to 33-998, inclusive, provide otherwise, the creation of a committee and appointment of members to it shall be approved by the greater of (1) a majority of all the directors in office when the action is taken, or (2) the number of directors required by the certificate of incorporation or bylaws to take action under section 33-752.
(c) (1) In the case of a corporation with at least one hundred shareholders which is not otherwise required to have an audit committee under federal law or regulation or the regulation of a national securities exchange registered under the Securities Exchange Act of 1934, as amended, the board of directors shall, in the manner provided in subsection (b) of this section, whether or not the bylaws provide for such a committee, designate two or more directors to constitute an audit committee, at least one of whom shall be independent, if the board of directors includes an independent director. A director shall be deemed to be “independent” unless (A) such director, or any spouse, parent or child of such director, or any other corporation, firm or organization in which such director or any such spouse, parent or child has a substantial interest, or any combination thereof, has or at any time during the last two fiscal years of the corporation has had one or more of the following relationships: (i) That of officer or employee of the corporation or of any other corporation, firm or organization which owns a ten per cent or more debt or equity interest in the corporation or in which the corporation owns a ten per cent or more debt or equity interest; (ii) that of ownership of ten per cent or more of the debt or equity of the corporation; or (iii) that of a business or professional relationship with the corporation, other than by reason of the directorship itself, where the amount involved in all transactions which result from such relationship during any fiscal year of the corporation exceeds forty thousand dollars, or where the amount derived from transactions directly between the corporation and such director or such spouse, parent or child exceeds five per cent of such director’s annual income, or (B) such director serves as an independent director on the boards of directors of more than five corporations. (2) The audit committee shall perform such functions as the bylaws or a resolution of the board of directors of the corporation may provide, except that if any such corporation engages or proposes to engage an independent public accountant to review the preparation of and render reports on the financial statements of the corporation, notwithstanding any provisions of the bylaws or such resolution, the audit committee shall review, evaluate and advise the board of directors with respect to (A) the proposed engagement and any succeeding engagement of the accountant or any successor, and (B) the functions performed by the accountant pursuant to the terms of the accountant’s engagement.
(d) The provisions of sections 33-748 to 33-752, inclusive, apply both to committees of the board and their members.
(e) To the extent specified by the board of directors or in the certificate of incorporation or bylaws, each committee may exercise the powers of the board of directors under section 33-735.
(f) A committee may not, however: (1) Authorize or approve distributions, except according to a formula or method, or within limits, prescribed by the board of directors; (2) approve or propose to shareholders action that sections 33-600 to 33-998, inclusive, require be approved by shareholders; (3) fill vacancies on the board of directors or, subject to subsection (h) of this section, on any of its committees; or (4) adopt, amend or repeal bylaws.
(g) The creation of, delegation of authority to, or action by a committee does not alone constitute compliance by a director with the standards of conduct described in section 33-756.
(h) The board of directors may appoint one or more directors as alternate members of any committee to replace any absent or disqualified member during the member’s absence or disqualification. If authorized by the certificate of incorporation, the bylaws or the resolution creating the committee, in the event of the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, unanimously, may appoint another director to act in place of the absent or disqualified member.
(P.A. 94-186, S. 99, 215; P.A. 96-271, S. 74, 254; P.A. 01-199, S. 10.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, amended Subsec. (a) to replace “bylaws” with “a bylaw”, amended Subsec. (c) to replace “member of such director’s immediate family” with “spouse, parent or child” and amended Subsec. (d) to delete provisions that described the subject matter of the referenced statutory sections and rephrase the remaining provisions, effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to specify that Secs. 33-600 to 33-998, inclusive, may provide other rules for the creation of committees and appointment of members thereto, authorize the board to appoint “one or more” members to serve on any committee and delete requirement that each committee have “two or more members, who serve at the pleasure of the board of directors”, amended Subsec. (b) to make a technical change and specify that Secs. 33-600 to 33-998, inclusive, may provide other rules for the approval of the creation of a committee and appointment of members thereto, amended Subsec. (d) to rephrase provisions, amended Subsec. (e) to replace “authority” with “powers”, amended Subsec. (f) to replace in Subdiv. (1) “Authorize distributions” with “Authorize or approve distributions, except according to a formula or method, or within limits, prescribed by the board of directors”, add in Subdiv. (3) that filling vacancies on committees is “subject to subsection (h) of this section”, delete former Subdiv. (4) re amendment of the certificate of incorporation, renumbering former Subdiv. (5) as Subdiv. (4), delete former Subdiv. (6) re approval of a plan or merger not requiring shareholder approval, delete former Subdiv. (7) re authorization or approval of a reacquisition of shares and delete former Subdiv. (8) re authorization or approval of the issuance or sale of shares or the determination of rights, preferences and limitations of a class or series of shares, and added new Subsec. (h) re appointment of alternate members.
Sec. 33-754. Submission of matters for shareholder vote. A corporation may agree to submit a matter to a vote of its shareholders even if, after approving the matter, the board of directors determines it no longer recommends the matter.
(P.A. 10-35, S. 5.)
Sec. 33-755. Reserved for future use.
(C)
STANDARDS OF CONDUCT
AND LIABILITY
Sec. 33-756. General standards of conduct for directors. (a) Each member of the board of directors, when discharging the duties of a director, shall act: (1) In good faith; and (2) in a manner the director reasonably believes to be in the best interests of the corporation.
(b) The members of the board of directors or a board committee, when becoming informed in connection with their decision-making function or devoting attention to their oversight function, shall discharge their duties with the care that a person in a like position would reasonably believe appropriate under similar circumstances.
(c) In discharging board or committee duties, a director shall disclose, or cause to be disclosed, to the other board or committee members information not already known by them but known by the director to be material to the discharge of their decision-making or oversight functions, except that disclosure is not required to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule.
(d) In discharging board or committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on the performance by any of the persons specified in subdivision (1) or (3) of subsection (f) of this section to whom the board may have delegated, formally or informally by course of conduct, the authority or duty to perform one or more of the board’s functions that are delegable under applicable law.
(e) In discharging board or committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, prepared or presented by any of the persons specified in subsection (f) of this section.
(f) A director is entitled to rely, in accordance with subsection (d) or (e) of this section, on: (1) One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the functions performed or the information, opinions, reports or statements provided; (2) legal counsel, public accountants or other persons retained by the corporation as to matters involving skills or expertise the director reasonably believes are matters (A) within the particular person’s professional or expert competence, or (B) as to which the particular person merits confidence; or (3) a board committee of which the director is not a member if the director reasonably believes the committee merits confidence.
(g) For the purposes of sections 33-817, 33-830, 33-831, 33-841 and 33-844, a director of a corporation that has a class of voting stock registered pursuant to Section 12 of the Securities Exchange Act of 1934, as the same has been or hereafter may be amended from time to time, in addition to complying with the provisions of subsections (a) to (c), inclusive, of this section, may consider, in determining what the director reasonably believes to be in the best interests of the corporation, (1) the long-term as well as the short-term interests of the corporation, (2) the interests of the shareholders, long-term as well as short-term, including the possibility that those interests may be best served by the continued independence of the corporation, (3) the interests of the corporation’s employees, customers, creditors and suppliers, and (4) community and societal considerations, including those of any community in which any office or other facility of the corporation is located. A director may also consider, in the discretion of such director, any other factors the director reasonably considers appropriate in determining what the director reasonably believes to be in the best interests of the corporation.
(P.A. 94-186, S. 100, 215; P.A. 10-35, S. 10; P.A. 14-217, S. 156; P.A. 17-108, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 10-35 amended Subsec. (d) to substitute “may” for “shall” re director’s consideration of factors in Subdivs. (1) to (4) in determining what he reasonably believes to be in best interests of corporation; P.A. 14-217 added Subsec. (f) re liability of director for duties performed under Sec. 33-1358; P.A. 17-108 amended Subsec. (a) by replacing provision re director discharge of duties with provision re member of board of directors discharge of duties of director, deleting Subdiv. (2) re care of ordinarily prudent person, redesignating Subdiv. (3) as new Subdiv. (2), and making technical changes, deleted former Subsecs. (b) to (f), added new Subsec. (b) re members of board of directors or board committee discharge of duties, added new Subsec. (c) re director disclosures to board or committee members, added new Subsec. (d) re director entitled to rely on performance of persons to whom board delegated authority or duty, added new Subsec. (e) re director entitled to rely on information, opinions, reports or statements and financial data prepared by specified persons, added new Subsec. (f) re director entitled to rely on officers or employees of corporation, legal counsel, public accountants or other persons retained by corporation or board committee, and added new Subsec. (g) re considerations by director.
Sec. 33-757. Liability for unlawful distribution. (a) A director who votes for or assents to a distribution made in violation of section 33-687 or subsection (a) of section 33-887b or the certificate of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating section 33-687 or subsection (a) of section 33-887b or the certificate of incorporation if it is established that he did not perform his duties in compliance with section 33-756 or subsection (a) of section 33-887b. In any proceeding commenced under this section, a director has all of the defenses ordinarily available to a director.
(b) A director held liable under subsection (a) of this section for an unlawful distribution is entitled to contribution: (1) From every other director who could be held liable under subsection (a) of this section for the unlawful distribution; and (2) from each shareholder for the amount the shareholder accepted knowing the distribution was made in violation of section 33-687 or subsection (a) of section 33-887b or the certificate of incorporation.
(c) A proceeding under this section to enforce (1) the liability of a director under subsection (a) of this section is barred unless it is commenced within two years after the date (A) on which the effect of the distribution was measured under subsection (e) or (g) of section 33-687, (B) as of which a violation of subsection (a) of section 33-687 occurred as a consequence of disregarding a restriction in the certificate of incorporation, or (C) on which the distribution of assets to shareholders was made under subsection (a) of section 33-887b; or (2) contribution or recoupment under subsection (b) of this section is barred unless it is commenced within one year after the liability of the claimant has been finally adjudicated under subsection (a) of this section.
(d) For purposes of this section, a director shall be deemed to have voted for a distribution if such director was present at the meeting of the board of directors or committee thereof at the time such distribution was authorized and did not vote in dissent therefrom, or if such director consented thereto pursuant to section 33-749.
(P.A. 94-186, S. 101, 215; P.A. 96-271, S. 75, 76, 254; P.A. 03-18, S. 7; P.A. 15-48, S. 5.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-18 made a technical change in Subsec. (a), amended Subsecs. (a) and (b) to add references to Sec. 33-887a, and amended Subsec. (c) by adding provision re enforcement of liability of director as Subdiv. (1), designating existing provision re date on which effect of distribution was measured as Subpara. (A), adding provision re date as of which a violation of Sec. 33-687(a) occurred as Subpara. (B), adding provision re date on which distribution of assets was made under Sec. 33-887a as Subpara. (C), and adding provision re enforcement of contribution or recoupment as Subdiv. (2), effective July 1, 2003; P.A. 15-48 substituted “subsection (a) of section 33-887b” for references to Sec. 33-887a.
Sec. 33-758. General standards of liability for directors. (a) A director shall not be liable to the corporation or its shareholders for any decision to take or not to take action, or any failure to take any action, as a director, unless the party asserting liability in a proceeding establishes that:
(1) No defense interposed by the director based on (A) any provision in the certificate of incorporation authorized by subdivision (4) or (6) of subsection (b) of section 33-636, or (B) the protection afforded by section 33-782, for action taken in compliance with section 33-783 or 33-784, or (C) the protection afforded by section 33-785 precludes liability of the director; and
(2) The challenged conduct consisted of or was the result of (A) an action not in good faith; (B) a decision (i) which the director did not reasonably believe to be in the best interests of the corporation, or (ii) as to which the director was not informed to an extent the director reasonably believed appropriate in the circumstances; (C) a lack of objectivity due to the director’s familial, financial or business relationship with, or a lack of independence due to the director’s domination or control by, another person having a material interest in the challenged conduct (i) which relationship or which domination or control could reasonably be expected to have affected the director’s judgment respecting the challenged conduct in a manner adverse to the corporation, and (ii) after a reasonable expectation to such effect has been established, the director has not established that the challenged conduct was reasonably believed by the director to be in the best interests of the corporation; (D) a sustained failure of the director to devote attention to ongoing oversight of the business and affairs of the corporation, or a failure to devote timely attention, by making, or causing to be made, appropriate inquiry, when particular facts and circumstances of significant concern materialize that would alert a reasonably attentive director to the need for such inquiry; or (E) the receipt of a financial benefit to which the director was not entitled or any other breach of the director’s duties to deal fairly with the corporation and its shareholders that is actionable under applicable law.
(b) The party seeking to hold the director liable:
(1) For money damages, shall also have the burden of establishing that (A) harm to the corporation or its shareholders has been suffered, and (B) the harm suffered was proximately caused by the director’s challenged conduct;
(2) For other money payment under a legal remedy, such as compensation for the unauthorized use of corporate assets, shall also have whatever persuasion burden may be called for to establish that the payment sought is appropriate in the circumstances; or
(3) For other money payment under an equitable remedy, such as profit recovery by or disgorgement to the corporation, shall also have whatever persuasion burden may be called for to establish that the equitable remedy sought is appropriate in the circumstances.
(c) Nothing in this section shall:
(1) In any instance where fairness is at issue, such as consideration of the fairness of a transaction to the corporation under subdivision (3) of subsection (b) of section 33-782, alter the burden of proving the fact or lack of fairness otherwise applicable;
(2) Alter the fact or lack of liability of a director under any provision in sections 33-600 to 33-998, inclusive, such as the provisions governing the consequences of an unlawful distribution under section 33-757 or a transactional interest under section 33-782; or
(3) Affect any rights to which the corporation or a shareholder may be entitled under another chapter of the general statutes or a section of the United States Code.
(P.A. 17-108, S. 2.)
Secs. 33-759 to 33-762. Reserved for future use.
(D)
OFFICERS
Sec. 33-763. Officers. (a) A corporation has the offices described in its bylaws or designated by the board of directors in accordance with the bylaws.
(b) The board of directors may elect individuals to fill one or more offices of the corporation. An officer may appoint one or more officers if authorized by the bylaws or the board of directors.
(c) The bylaws or the board of directors shall assign to one of the officers responsibility for preparing the minutes of the directors’ and shareholders’ meetings and for maintaining and authenticating the records of the corporation required to be kept under subsections (a) and (e) of section 33-945.
(d) The same individual may simultaneously hold more than one office in a corporation.
(P.A. 94-186, S. 102, 215; P.A. 01-199, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to replace “officers” with “offices” and “appointed” with “designated”, amended Subsec. (b) to add provision authorizing the board of directors to elect individuals to fill one or more offices of the corporation, replace “A duly appointed officer” with “An officer” and delete provision authorizing said officer to appoint “assistant officers” and amended Subsec. (c) to replace “delegate” with “assign”, add the responsibility of “maintaining” the records, make technical changes and specify that the corporate records to be maintained and authenticated are those required to be kept under Sec. 33-945(a) and (e).
Sec. 33-764. Functions of officers. Each officer has the authority and shall perform the functions set forth in the bylaws or, to the extent consistent with the bylaws, the functions prescribed by the board of directors or by direction of an officer authorized by the board of directors to prescribe the functions of other officers.
(P.A. 94-186, S. 103, 215; P.A. 06-68, S. 5.)
History: P.A. 94-186 effective January 1, 1997; P.A. 06-68 replaced references to “duties” with references to “functions”.
Sec. 33-765. Standards of conduct for officers. (a) An officer with discretionary authority shall discharge his duties under that authority: (1) In good faith; (2) with the care an ordinarily prudent person in a like position would exercise under similar circumstances; and (3) in a manner he reasonably believes to be in the best interests of the corporation.
(b) In discharging his duties an officer is entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, if prepared or presented by: (1) One or more officers or employees of the corporation whom the officer reasonably believes to be reliable and competent in the matters presented; or (2) legal counsel, public accountants or other persons as to matters the officer reasonably believes are within the person’s professional or expert competence.
(c) An officer is not acting in good faith if he has knowledge concerning the matter in question that makes reliance otherwise permitted by subsection (b) of this section unwarranted.
(d) An officer is not liable for any action taken as an officer, or any failure to take any action, if he performed the duties of his office in compliance with this section.
(e) An officer is not liable under this section for any act or omission in the course of performing the duties of an officer under subsection (a) of section 33-1360 if the officer performed such duties in compliance with this section and section 33-1360.
(P.A. 94-186, S. 104, 215; P.A. 14-217, S. 157.)
History: P.A. 94-186 effective January 1, 1997; P.A. 14-217 added Subsec. (e) re liability of officer for duties performed under Sec. 33-1360.
Sec. 33-766. Resignation and removal of officers. (a) An officer may resign at any time by delivering notice to the corporation. A resignation is effective when the notice is delivered unless the notice specifies a later effective time. If a resignation is made effective at a later time and the board of directors or the appointing officer accepts the future effective time, the board or the appointing officer may fill the pending vacancy before the effective time if the board or the appointing officer provides that the successor does not take office until the effective time.
(b) An officer may be removed at any time with or without cause by: (1) The board of directors, (2) the officer who appointed such officer, unless the bylaws provide otherwise, or (3) any other officer if authorized by the bylaws or the board of directors.
(c) In this section, “appointing officer” means the officer, including any successor to that officer, who appointed the officer resigning or being removed.
(P.A. 94-186, S. 105, 215; P.A. 01-199, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to replace “date” with “time” where appearing and add references to “the appointing officer” in provision re filling of a pending vacancy when a resignation is made effective at a later time, amended Subsec. (b) to rephrase provisions, designate as Subdiv. (1) provision re removal by the board of directors, add Subdiv. (2) re removal by the officer who appointed such officer and add Subdiv. (3) re removal by any other officer authorized by the bylaws or board of directors and added Subsec. (c) to define “appointing officer”.
Sec. 33-767. Contract rights of officers. (a) The appointment of an officer does not itself create contract rights.
(b) An officer’s removal does not affect the officer’s contract rights, if any, with the corporation. An officer’s resignation does not affect the corporation’s contract rights, if any, with the officer.
(P.A. 94-186, S. 106, 215.)
History: P.A. 94-186 effective January 1, 1997.
Secs. 33-768 and 33-769. Reserved for future use.
(E)
INDEMNIFICATION
Sec. 33-770. Definitions. As used in sections 33-770 to 33-779, inclusive:
(1) “Corporation” includes any domestic or foreign predecessor entity of a corporation in a merger.
(2) “Director” or “officer” means an individual who is or was a director or officer, respectively, of a corporation or who, while a director or officer of the corporation, is or was serving at the corporation’s request as a director, officer, partner, trustee, employee or agent of another domestic or foreign corporation, partnership, joint venture, trust, employee benefit plan or other entity. A director or officer is considered to be serving an employee benefit plan at the corporation’s request if the individual’s duties to the corporation also impose duties on, or otherwise involve services by, the individual to the plan or to participants in or beneficiaries of the plan. “Director” or “officer” includes, unless the context requires otherwise, the estate or personal representative of a director or officer.
(3) “Liability” means the obligation to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding.
(4) “Official capacity” means: (A) When used with respect to a director, the office of director in a corporation; and (B) when used with respect to an officer, as contemplated in section 33-776, the office in a corporation held by the officer. “Official capacity” does not include service for any other domestic or foreign corporation or any partnership, joint venture, trust, employee benefit plan or other entity.
(5) “Party” means an individual who was, is, or is threatened to be made, a defendant or respondent in a proceeding.
(6) “Proceeding” means any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative and whether formal or informal.
(P.A. 94-186, S. 107, 215; P.A. 97-246, S. 12, 99; P.A. 06-68, S. 6; P.A. 09-55, S. 29.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 made definitions applicable to Sec. 33-779, amended the definition of “corporation” to delete “or other transaction in which the predecessor’s existence ceased upon consummation of the transaction”, amended the definition of “director” to include an “officer” within definition and replace “enterprise” with “entity”, added new Subdiv. (3) defining “disinterested director”, renumbering the remaining Subdivs. accordingly, amended definition of “official capacity” to replace “enterprise” with “entity”, amended definition of “party” to replace “includes” with “means” and replace “named defendant” with “defendant” and amended definition of “proceeding” to add “arbitrative”, effective June 27, 1997; P.A. 06-68 deleted former Subdiv. (3) re definition of “disinterested director”, redesignated existing Subdivs. (4) to (8) as Subdivs. (3) to (7), amended redesignated Subdiv. (5)(B) by replacing “individual other than a director” with “officer” and deleting “or the employment or agency relationship undertaken by the employee or agent on behalf of the corporation” and made technical changes in Subdiv. (2) and redesignated Subdiv. (6); P.A. 09-55 deleted former Subdiv. (3) defining “expenses” and redesignated existing Subdivs. (4) to (7) as Subdivs. (3) to (6).
Sec. 33-771. Permissible indemnification. (a) Except as otherwise provided in this section, a corporation may indemnify an individual who is a party to a proceeding because he is a director against liability incurred in the proceeding if: (1) (A) He conducted himself in good faith; (B) he reasonably believed (i) in the case of conduct in his official capacity, that his conduct was in the best interests of the corporation; and (ii) in all other cases, that his conduct was at least not opposed to the best interests of the corporation; and (C) in the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful; or (2) he engaged in conduct for which broader indemnification has been made permissible or obligatory under a provision of the certificate of incorporation as authorized by subdivision (5) of subsection (b) of section 33-636.
(b) A director’s conduct with respect to an employee benefit plan for a purpose he reasonably believed to be in the interests of the participants in and beneficiaries of the plan is conduct that satisfies the requirement of subparagraph (ii) of subdivision (1) of subsection (a) of this section.
(c) The termination of a proceeding by judgment, order, settlement or conviction or upon a plea of nolo contendere or its equivalent is not, of itself, determinative that the director did not meet the relevant standard of conduct described in this section.
(d) Unless ordered by a court under section 33-774, a corporation may not indemnify a director under this section: (1) In connection with a proceeding by or in the right of the corporation except for reasonable expenses incurred in connection with the proceeding if it is determined that the director has met the relevant standard of conduct under subsection (a) of this section; or (2) in connection with any proceeding with respect to conduct for which he was adjudged liable on the basis that he received a financial benefit to which he was not entitled, whether or not involving action in his official capacity.
(e) Notwithstanding any provision of this section to the contrary, a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, shall, except to the extent that the certificate of incorporation expressly provides otherwise, indemnify under sections 33-770 to 33-779, inclusive, except subdivision (2) of subsection (a) of this section, a director to the same extent the corporation is permitted to provide the same to a director pursuant to subdivision (1) of subsection (a) and subsections (b), (c) and (d) of this section as limited by the provisions of section 33-775.
(P.A. 94-186, S. 108, 215; P.A. 96-271, S. 77, 254; P.A. 97-246, S. 13, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (f) to replace “articles” of incorporation with “certificate” of incorporation and “January 1, 1996” with “January 1, 1997”, effective January 1, 1997; P.A. 97-246 substantially revised section, including amending Subsec. (a) to add new Subdiv. (2) re indemnification pursuant to the certificate of incorporation, revising Subsec. (d) re when a corporation may not indemnify a director, deleting former Subsec. (e) re limitation on indemnification in connection with proceeding by or in the right of the corporation, which provision was incorporated into Subsec. (d)(1), and redesignating former Subsec. (f) as Subsec. (e) and rephrasing said Subsec., effective June 27, 1997.
Sec. 33-772. Mandatory indemnification. A corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which he was a party because he was a director of the corporation against reasonable expenses incurred by him in connection with the proceeding.
(P.A. 94-186, S. 109, 215; P.A. 96-271, S. 78, 254; P.A. 97-246, S. 14, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 97-246 deleted provision that subjected the indemnification requirement to any limitation contained in the certificate of incorporation and made a technical change, effective June 27, 1997.
Sec. 33-773. Advance for expenses. (a) A corporation may, before final disposition of a proceeding, advance funds to pay for or reimburse the reasonable expenses incurred in connection with the proceeding by an individual who is a party to the proceeding because that individual is a member of the board of directors if the director delivers to the corporation a signed written undertaking of the director to repay any funds advanced if (1) the director is not entitled to mandatory indemnification under section 33-772, and (2) it is ultimately determined under section 33-774 or 33-775 that the director is not entitled to indemnification.
(b) The undertaking required by subsection (a) of this section must be an unlimited general obligation of the director but need not be secured and may be accepted without reference to the financial ability of the director to make repayment.
(c) Authorizations under this section shall be made:
(1) By the board of directors: (A) If there are two or more qualified directors, by a majority vote of all the qualified directors, a majority of whom shall for such purpose constitute a quorum, or by a majority of the members of a committee consisting solely of two or more qualified directors appointed by such a vote; or (B) if there are fewer than two qualified directors, by the vote necessary for action by the board in accordance with subsection (c) of section 33-752, in which authorization directors who are not qualified directors may participate; or
(2) By the shareholders, but shares owned by or voted under the control of a director who at the time is not a qualified director may not be voted on the authorization.
(P.A. 94-186, S. 110, 215; P.A. 97-246, S. 15, 99; P.A. 98-137, S. 8, 62; 98-219, S. 33, 34; P.A. 06-68, S. 7; P.A. 11-147, S. 17; P.A. 15-48, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 substantially revised section, including amending Subsec. (a) to revise the documentation required in order to permit the corporation to advance funds and delete the requirement of a prior determination that the facts then known would not preclude indemnification and amending Subsec. (c) to replace provision that required authorizations of payments to be made in the manner specified in Sec. 33-775 with provision specifying the procedure for authorizations to be made by the board of directors and by the shareholders, effective June 27, 1997; P.A. 98-137 amended Subsec. (a)(1) to replace “conduct for which liability has been eliminated” with “conduct for which liability has been limited”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 06-68 amended Subsec. (a) by replacing provisions re director with provisions re individual who is a member of the board of directors, adding provision re expenses incurred in connection with the proceeding and making technical changes, and amended Subsec. (c) by replacing references to “disinterested directors” with references to “qualified directors”, adding reference to Sec. 33-752(c) and making technical changes; P.A. 11-147 amended Subsec. (a) to require written affirmation in Subdiv. (1) and written undertaking in Subdiv. (2) to be “signed”; P.A. 15-48 amended Subsec. (a) by deleting former Subdiv. (1) re requirement of written affirmation and former Subdiv. (2) designator, adding new Subdiv. (1) and (2) designators, deleting provision re director meeting standard of conduct in Sec. 33-771 and adding “is not entitled to indemnification”, amended Subsec. (b) by deleting “subdivision (2) of” and amended Subsec. (c)(1)(A) by replacing “committee of” with “committee consisting solely of”.
Sec. 33-774. Court-ordered indemnification and advance for expenses. (a) A director who is a party to a proceeding because he is a director may apply for indemnification or an advance for expenses to the court conducting the proceeding or to another court of competent jurisdiction. After receipt of an application and after giving any notice it considers necessary, the court shall: (1) Order indemnification if it determines that the director is entitled to mandatory indemnification under section 33-772; (2) order indemnification or advance for expenses if the court determines that the director is entitled to indemnification or advance for expenses pursuant to a provision authorized by subsection (a) of section 33-778; or (3) order indemnification or advance for expenses if the court determines, in view of all the relevant circumstances, that it is fair and reasonable to indemnify or advance expenses to the director, even if he has not met the relevant standard of conduct set forth in subsection (a) of section 33-771, failed to comply with section 33-773 or was adjudged liable in a proceeding referred to in subdivision (1) or (2) of subsection (d) of section 33-771, provided if he was adjudged so liable his indemnification shall be limited to reasonable expenses incurred in connection with the proceeding.
(b) If the court determines that the director is entitled to indemnification under subdivision (1) of subsection (a) of this section or to indemnification or advance for expenses under subdivision (2) of subsection (a) of this section, it shall also order the corporation to pay the director’s reasonable expenses incurred in connection with obtaining court-ordered indemnification or advance for expenses. If the court determines that the director is entitled to indemnification or advance for expenses under subdivision (3) of subsection (a) of this section, it may also order the corporation to pay the director’s reasonable expenses to obtain court-ordered indemnification or advance for expenses.
(P.A. 94-186, S. 111, 215; P.A. 96-271, S. 79, 254; P.A. 97-246, S. 16, 99; P.A. 15-48, S. 7.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 97-246 substantially revised section, including requiring, rather than authorizing, the court to order indemnification if it determines the director is so entitled and making section applicable to applications for an advance for expenses, effective June 27, 1997; P.A. 15-48 amended Subsec. (a)(3) by deleting Subpara. (A) and (B) designators and making technical changes.
Sec. 33-775. Determination and authorization of indemnification. (a) A corporation may not indemnify a director under section 33-771 unless authorized for a specific proceeding after a determination has been made that indemnification is permissible because the director has met the relevant standard of conduct set forth in said section.
(b) The determination shall be made:
(1) If there are two or more qualified directors, by the board of directors by a majority vote of all the qualified directors, a majority of whom shall for such purpose constitute a quorum, or by a majority of the members of a committee of two or more qualified directors appointed by such a vote;
(2) By special legal counsel (A) selected in the manner prescribed in subdivision (1) of this subsection, or (B) if there are fewer than two qualified directors, selected by the board of directors, in which selection directors who are not qualified directors may participate; or
(3) By the shareholders, but shares owned by or voted under the control of a director who at the time is not a qualified director may not be voted on the determination.
(c) Authorization of indemnification shall be made in the same manner as the determination that indemnification is permissible, except that if there are fewer than two qualified directors, or if the determination is made by special legal counsel, authorization of indemnification shall be made by those entitled to select special legal counsel under subparagraph (B) of subdivision (2) of subsection (b) of this section.
(P.A. 94-186, S. 112, 215; P.A. 97-246, S. 17, 99; P.A. 01-199, S. 13; P.A. 06-68, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 substantially revised section, including amending Subsec. (b) to revise the manner for determining whether indemnification is permissible and amending Subsec. (c) to revise the manner for authorizing indemnification, effective June 27, 1997; P.A. 01-199 amended Subsec. (c) to add “or if the determination is made by special legal counsel”; P.A. 06-68 replaced references to “disinterested directors” with references to “qualified directors” and made technical changes throughout section.
Sec. 33-776. Indemnification of and advance for expenses to officers. Indemnification by corporations incorporated prior to January 1, 1997. (a) A corporation may indemnify and advance expenses under sections 33-770 to 33-779, inclusive, to an officer of the corporation who is a party to a proceeding because he is an officer of the corporation (1) to the same extent as a director, and (2) if he is an officer but not a director, to such further extent as may be provided by contract, the certificate of incorporation, the bylaws or a resolution of the board of directors except for (A) liability in connection with a proceeding by or in the right of the corporation other than for expenses incurred in connection with the proceeding, or (B) liability arising out of conduct that (i) constitutes a knowing and culpable violation of law by the officer, (ii) enabled the officer to receive an improper personal gain, (iii) showed a lack of good faith and conscious disregard for the duty of the officer to the corporation under circumstances in which the officer was aware that his conduct or omission created an unjustifiable risk of serious injury to the corporation, or (iv) constituted a sustained and unexcused pattern of inattention that amounted to an abdication of the officer’s duty to the corporation. A corporation may delegate to its general counsel or other specified officer or officers the ability under this subsection to determine that indemnification or advance for expenses to such officer is permissible and the ability to authorize payment of such indemnification or advance for expenses. Nothing in this subdivision shall in any way limit either the ability or the obligation of a corporation to indemnify and advance expenses under other applicable law to any officer who is not a director.
(b) The provisions of subdivision (2) of subsection (a) of this section shall apply to an officer who is also a director if the basis on which he is made a party to the proceeding is an act or omission solely as an officer.
(c) An officer of a corporation who is not a director is entitled to mandatory indemnification under section 33-772 and may apply to a court under section 33-774 for indemnification or advance for expenses, in each case to the same extent to which a director may be entitled to indemnification or advance for expenses under said sections.
(d) A corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, shall, except to the extent that the certificate of incorporation expressly provides otherwise, indemnify under sections 33-770 to 33-779, inclusive, except subdivision (2) of subsection (a) of section 33-771, each officer, employee or agent of the corporation who is not a director to the same extent as the corporation is permitted to provide the same to a director pursuant to subdivision (1) of subsection (a) and subsections (b), (c) and (d) of section 33-771, as limited by section 33-775, and for this purpose the determination required by section 33-775 may in addition be made by the general counsel of the corporation, or such other or additional officer or officers as the board of directors may specify.
(P.A. 94-186, S. 113, 215; P.A. 96-271, S. 80, 254; P.A. 97-246, S. 18, 99; P.A. 15-48, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, amended Subdiv. (3) to add “Notwithstanding subdivision (4) of this section” and add provision permitting the delegation to the general counsel or other specified officer the ability to authorize such indemnification and the responsibility to determine whether any conditions to such indemnification or advance of expenses have been established and amended Subdiv. (4) to replace “January 1, 1996” with “January 1, 1997” and add provision authorizing the determination required by Sec. 33-775 to be made by the general counsel or such other or additional officer or officers as the board of directors may specify, effective January 1, 1997; P.A. 97-246 substantially revised section, effective June 27, 1997; P.A. 15-48 amended Subsecs. (a) to (c) by deleting references to employee or agent and amended Subsec. (a)(2) by deleting “, consistent with public policy,” and adding Subparas. (A) and (B) re exceptions to indemnification and advancement of expenses.
Sec. 33-777. Insurance. A corporation may purchase and maintain insurance on behalf of an individual who is a director or officer of the corporation, or who, while a director or officer of the corporation, serves at the corporation’s request as a director, officer, partner, trustee, employee or agent of another domestic or foreign corporation, partnership, joint venture, trust, employee benefit plan or other entity, against liability asserted against or incurred by him in that capacity or arising from his status as a director or officer whether or not the corporation would have power to indemnify or advance expenses to him against the same liability under sections 33-770 to 33-779, inclusive.
(P.A. 94-186, S. 114, 215; P.A. 97-246, S. 19, 99; P.A. 15-48, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 revised and rephrased section, including adding reference to the corporation’s power to advance expenses to an individual and replacing the reference to “section 33-771 or 33-772” with “sections 33-770 to 33-779, inclusive,” effective June 27, 1997; P.A. 15-48 deleted references to employee or agent and made technical changes.
Sec. 33-778. Variation by corporate action. (a) A corporation may, by a provision in its certificate of incorporation or bylaws or in a resolution adopted or a contract approved by its board of directors or shareholders, obligate itself in advance of the act or omission giving rise to a proceeding to provide indemnification in accordance with section 33-771 or advance funds to pay for or reimburse expenses in accordance with section 33-773. Any such obligatory provision shall be deemed to satisfy the requirements for authorization referred to in subsection (c) of section 33-773 and subsection (c) of section 33-775. Any such provision that obligates the corporation to provide indemnification to the fullest extent permitted by law shall be deemed to obligate the corporation to advance funds to pay for or reimburse expenses in accordance with section 33-773 to the fullest extent permitted by law, unless the provision specifically provides otherwise.
(b) A right of indemnification or to advances for expenses created by this subpart or under subsection (a) of this section and in effect at the time of an act or omission shall not be eliminated or impaired with respect to such act or omission by an amendment of the certificate of incorporation or bylaws or a resolution of the directors or shareholders, adopted after the occurrence of such act or omission, unless, in the case of a right created under subsection (a) of this section, the provision creating such right and in effect at the time of such act or omission explicitly authorizes such elimination or impairment after such act or omission has occurred.
(c) Any provision pursuant to subsection (a) of this section shall not obligate the corporation to indemnify or advance expenses to a director of a predecessor of the corporation, pertaining to conduct with respect to the predecessor, unless otherwise specifically provided. Any provision for indemnification or advance for expenses in the certificate of incorporation, bylaws or resolution of the board of directors or shareholders of a predecessor of the corporation in a merger or in a contract to which the predecessor is a party, existing at the time the merger takes effect, shall be governed by subdivision (3) of subsection (a) of section 33-820.
(d) Subject to subsection (b) of this section, a corporation may, by a provision in its certificate of incorporation, limit any of the rights to indemnification or advance for expenses created by or pursuant to sections 33-770 to 33-779, inclusive.
(e) Sections 33-770 to 33-779, inclusive, do not limit a corporation’s power to pay or reimburse expenses incurred by a director or officer in connection with his appearance as a witness in a proceeding at a time when he is not a party.
(f) Sections 33-770 to 33-779, inclusive, do not limit a corporation’s power to indemnify, advance expenses to, or provide or maintain insurance on behalf of an employee or agent.
(P.A. 94-186, S. 115, 215; P.A. 96-271, S. 81, 254; P.A. 97-246, S. 20, 99; P.A. 01-199, S. 14; P.A. 12-32, S. 10; P.A. 15-48, S. 10.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 97-246 substantially revised section, including adding Subsec. (b) re limitation on indemnification of or advance for expenses to a director of a predecessor of the corporation and adding Subsec. (c) authorizing a corporation in its certificate of incorporation to limit statutory rights of indemnification and advance for expenses, effective June 27, 1997; P.A. 01-199 amended Subsec. (a) to provide that obligatory provision shall be deemed to satisfy the requirements for authorization in Sec. 33-773(c) and Sec. 33-775(c); P.A. 12-32 added new Subsec. (b) re prohibition of elimination or impairment of right of indemnification or to advances for expenses, redesignated existing Subsecs. (b) to (d) as Subsecs. (c) to (e) and amended redesignated Subsec. (d) to add reference to Subsec. (b); P.A. 15-48 amended Subsec. (e) by adding “or officer” and added Subsec. (f) re corporation’s power to indemnify, advance expenses to, or provide or maintain insurance on behalf of employee or agent.
Sec. 33-779. Exclusivity of provisions. A corporation may provide indemnification of or advance expenses to a director, officer, employee or agent only as permitted by sections 33-770 to 33-778, inclusive.
(P.A. 97-246, S. 21, 99.)
History: P.A. 97-246 effective June 27, 1997.
Sec. 33-780. Reserved for future use.
(F)
DIRECTORS’ CONFLICTING INTEREST TRANSACTIONS
Sec. 33-781. Definitions. As used in sections 33-781 to 33-784, inclusive:
(1) “Director’s conflicting interest transaction” means a transaction effected or proposed to be effected by the corporation, or by an entity controlled by the corporation, (A) to which, at the relevant time, the director is a party, (B) respecting which, at the relevant time, the director had knowledge and a material financial interest known to the director, or (C) respecting which, at the relevant time, the director knew that a related person was a party or had a material financial interest.
(2) “Control”, including the term “controlled by”, means (A) having the power, directly or indirectly, to elect or remove a majority of the members of the board of directors or other governing body of an entity, whether through the ownership of voting shares or interests, by contract, or otherwise, or (B) being subject to a majority of the risk of loss from the entity’s activities or entitled to receive a majority of the entity’s residual returns.
(3) “Relevant time” means (A) the time at which directors’ action respecting the transaction is taken in compliance with section 33-783, or (B) if the transaction is not brought before the board of directors of the corporation, or its committee, for action under section 33-783, at the time the corporation, or an entity controlled by the corporation, becomes legally obligated to consummate the transaction.
(4) “Material financial interest” means a financial interest in a transaction that would reasonably be expected to impair the objectivity of the director when participating in action on the authorization of the transaction.
(5) “Related person” means: (A) The individual’s spouse; (B) a child, stepchild, grandchild, parent, stepparent, grandparent, sibling, stepsibling, half-sibling, aunt, uncle, niece or nephew, or the spouse of any such person, of the individual or of the individual’s spouse; (C) a natural person living in the same home as the individual; (D) an entity, other than the corporation or an entity controlled by the corporation, controlled by the individual or any person specified in subparagraphs (A) to (C), inclusive, of this subdivision; (E) a domestic or foreign (i) business or nonstock corporation, other than the corporation or an entity controlled by the corporation, of which the individual is a director, (ii) unincorporated entity of which the individual is a general partner or a member of the governing body, or (iii) individual, trust or estate for whom or of which the individual is a trustee, guardian, personal representative or like fiduciary; or (F) a person that is, or an entity that is controlled by, an employer of the individual.
(6) “Fair to the corporation” means, for purposes of subdivision (3) of subsection (b) of section 33-782, that the transaction as a whole was beneficial to the corporation, taking into appropriate account whether it was (A) fair in terms of the director’s dealings with the corporation, and (B) comparable to what might have been obtainable in an arm’s length transaction, given the consideration paid or received by the corporation.
(7) “Required disclosure” means disclosure of (A) the existence and nature of the director’s conflicting interest, and (B) all facts known to the director respecting the subject matter of the transaction that a director free of such conflicting interest would reasonably believe to be material in deciding whether to proceed with the transaction.
(P.A. 94-186, S. 116, 215; P.A. 96-271, S. 82, 254; P.A. 97-246, S. 85, 99; P.A. 06-68, S. 9; P.A. 17-108, S. 13.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 made technical changes, effective January 1, 1997; P.A. 97-246 rephrased definition of “related person” in Subdiv. (3), effective June 27, 1997; P.A. 06-68 replaced former definitions with new Subdivs. (1) to (7) defining “director’s conflicting interest transaction”, “control”, “relevant time”, “material financial interest”, “related person”, “fair to the corporation” and “required disclosure”; P.A. 17-108 redefined “related person” in Subdiv. (5).
Sec. 33-782. Judicial action. (a) A transaction effected or proposed to be effected by the corporation, or by an entity controlled by the corporation, may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation, on the ground that the director has an interest respecting the transaction, if it is not a director’s conflicting interest transaction.
(b) A director’s conflicting interest transaction may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation, on the ground that the director has an interest respecting the transaction, if: (1) Directors’ action respecting the transaction was taken in compliance with section 33-783 at any time; (2) shareholders’ action respecting the transaction was taken in compliance with section 33-784 at any time; or (3) the transaction, judged according to the circumstances at the relevant time, is established to have been fair to the corporation.
(P.A. 94-186, S. 117, 215; P.A. 96-271, S. 83, 254; P.A. 06-68, S. 10.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to add “or” prior to Subdiv. (3), effective January 1, 1997; P.A. 06-68 amended Subsec. (a) by replacing former provisions with revised language re transaction that is not a director’s conflicting interest transaction and amended Subsec. (b) by replacing “enjoined, set aside” with “the subject of equitable relief”, inserting “against a director of the corporation”, replacing provision re personal, economic or other association of director with “on the ground that the director”, replacing “interest in the transaction” with “interest respecting the transaction” and “time of commitment” with “relevant time” and making technical changes.
Sec. 33-783. Directors’ action. (a) Directors’ action respecting a director’s conflicting interest transaction is effective for purposes of subdivision (1) of subsection (b) of section 33-782 if the transaction has been authorized by the affirmative vote of a majority, but no fewer than two, of the qualified directors who voted on the transaction, after required disclosure by the conflicted director of information not already known by such qualified directors, or after modified disclosure in compliance with subsection (b) of this section, provided that where the action has been taken by a committee, all members of the committee were qualified directors, and either (1) the committee was composed of all the qualified directors on the board of directors, or (2) the members of the committee were appointed by the affirmative vote of a majority of the qualified directors on the board.
(b) Notwithstanding subsection (a) of this section, when a transaction is a director’s conflicting interest transaction only because a related person described in subparagraph (E) or (F) of subdivision (5) of section 33-781 is a party to or has a material financial interest in the transaction, the conflicted director is not obligated to make required disclosure to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality or a professional ethics rule, provided that the conflicted director discloses to the qualified directors voting on the transaction: (1) All information required to be disclosed that is not so violative, (2) the existence and nature of the director’s conflicting interest, and (3) the nature of the conflicted director’s duty not to disclose the confidential information.
(c) A majority, but no fewer than two, of all the qualified directors on the board of directors, or on the committee, constitutes a quorum for purposes of action that complies with this section. Directors’ action that otherwise complies with this section is not affected by the presence or vote of a director who is not a qualified director.
(d) Where directors’ action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the certificate of incorporation, the bylaws or a provision of law, independent action to satisfy those authorization requirements must be taken by the board of directors or a committee, in which action directors who are not qualified directors may participate.
(P.A. 94-186, S. 118, 215; P.A. 06-68, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 06-68 amended Subsec. (a) by inserting “director’s conflicting interest”, replacing “received” with “has been authorized by”, replacing provision re qualified directors on the board or duly empowered committee of the board with “the qualified directors” and replacing former provisions with revised language re required disclosure, compliance with Subsec. (b) and committee action, replaced former Subsec. (b) with new Subsec. (b) re director’s conflicting interest transaction because of related person being a party to or having a material financial interest in the transaction, and replaced former Subsec. (d) with new Subsec. (d) re satisfaction of transaction authorization requirements.
Sec. 33-784. Shareholders’ action. (a) Shareholders’ action respecting a director’s conflicting interest transaction is effective for purposes of subdivision (2) of subsection (b) of section 33-782 if a majority of the votes cast by the holders of all qualified shares are in favor of the transaction after (1) notice to shareholders describing the action to be taken respecting the transaction, (2) provision to the corporation of the information referred to in subsection (b) of this section, and (3) communication to the shareholders entitled to vote on the transaction of the information that is the subject of required disclosure, to the extent the information is not known by them. In the case of shareholders’ action at a meeting, the shareholders entitled to vote shall be determined as of the record date for notice of the meeting.
(b) A director who has a conflicting interest respecting the transaction shall, before the shareholders’ vote, inform the secretary or other officer or agent of the corporation authorized to tabulate votes, in writing, of the number of shares that the director knows are not qualified shares under subsection (c) of this section, and the identity of the holders of those shares.
(c) For purposes of this section: (1) “Holder” means, and “held by” refers to shares held by, both a record shareholder, as defined in subdivision (7) of section 33-855, and a beneficial shareholder; and (2) “qualified shares” means all shares entitled to be voted with respect to the transaction except for shares that the secretary or other officer or agent of the corporation authorized to tabulate votes either knows, or under subsection (b) of this section is notified, are held by (A) a director who has a conflicting interest respecting the transaction, or (B) a related person of the director, excluding a person described in subparagraph (F) of subdivision (5) of section 33-781.
(d) A majority of the votes entitled to be cast by the holders of all qualified shares constitutes a quorum for purposes of compliance with this section. Subject to the provisions of subsection (e) of this section, shareholders’ action that otherwise complies with this section is not affected by the presence of holders, or by the voting, of shares that are not qualified shares.
(e) If a shareholders’ vote does not comply with subsection (a) of this section solely because of a director’s failure to comply with subsection (b) of this section, and if the director establishes that the failure was not intended to influence and did not in fact determine the outcome of the vote, the court may take such action respecting the transaction and the director, and may give such effect, if any, to the shareholders’ vote, as the court considers appropriate in the circumstances.
(f) Where shareholders’ action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the certificate of incorporation, the bylaws or a provision of law, independent action to satisfy those authorization requirements must be taken by the shareholders, in which action shares that are not qualified shares may participate.
(P.A. 94-186, S. 119, 215; P.A. 06-68, S. 12; P.A. 11-147, S. 7; P.A. 17-108, S. 44.)
History: P.A. 94-186 effective January 1, 1997; P.A. 06-68 amended Subsec. (a) by repositioning “director’s conflicting interest”, replacing “votes entitled to be cast” with “votes cast”, inserting “action to be taken respecting the” in Subdiv. (1) and “to the corporation” in Subdiv. (2), replacing “required disclosure” with “communication” and “who voted” with “entitled to vote” and inserting “of the information that is the subject of required disclosure” in Subdiv. (3), and making technical changes, deleted former Subsec. (b) re qualified shares and former Subsec. (c) re action in compliance with section, redesignated existing Subsec. (d) as new Subsec. (b) and amended same by deleting provision re compliance with Subsec. (a), inserting “in writing”, deleting provisions re identity of persons holding or controlling vote and re shares known to be beneficially owned or controlled by director or related person, inserting provision re shares known to be not qualified shares and identity of holders thereof, and making technical changes, added new Subsec. (c) defining “holder” and “qualified shares” and new Subsec. (d) re quorum and effect of presence of holders of, or voting of, shares that are not qualified shares, amended Subsec. (e) by inserting “in fact” re determination of vote outcome, deleting provision re further proceedings respecting Sec. 33-782(b)(3) and making technical changes, and added Subsec. (f) re satisfaction of transaction authorization requirements; P.A. 11-147 amended Subsec. (a) to provide that in the case of shareholders’ action at a meeting, shareholders entitled to vote shall be determined as of the record date for notice of the meeting; P.A. 17-108 amend Subsec. (c)(1) by deleting “, as defined in subdivision (2) of section 33-855;”.
Sec. 33-785. Taking advantage of a business opportunity. (a) If a director or officer pursues or takes advantage of a business opportunity directly, or indirectly through or on behalf of another person, that action may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against the director, officer or other person, in a proceeding by or in the right of the corporation on the ground that such opportunity should have first been offered to the corporation, if (1) before the director, officer or other person becomes legally obligated respecting the opportunity, the director or officer brings it to the attention of the corporation and either: (A) Action by qualified directors disclaiming the corporation’s interest in the opportunity is taken in compliance with the same procedures as are set forth in section 33-783; or (B) shareholders’ action disclaiming the corporation’s interest in the opportunity is taken in compliance with the procedures set forth in section 33-784 in either case as if the decision being made concerned a director’s conflicting interest transaction, except that, rather than making required disclosure, as defined in section 33-781, the director or officer shall have made prior disclosure to those acting on behalf of the corporation of all material facts concerning the business opportunity known to the director or officer; or (2) the duty to offer the corporation the business opportunity has been limited or eliminated pursuant to a provision of the certificate of incorporation adopted, and where required, made effective by action of qualified directors, in accordance with subdivision (6) of subsection (b) of section 33-636.
(b) In any proceeding seeking equitable relief or other remedies based upon an alleged improper pursuit or taking advantage of a business opportunity by a director or officer directly, or indirectly through or on behalf of another person, the fact that the director or officer did not employ the procedure described in subparagraph (A) or (B) of subdivision (1) of subsection (a) of this section before pursuing or taking advantage of the opportunity shall not create an implication that the opportunity should have been first presented to the corporation or alter the burden of proof otherwise applicable to establish that the director or officer breached a duty to the corporation in the circumstances.
(P.A. 06-68, S. 15; P.A. 17-108, S. 14.)
History: P.A. 17-108 substantially amended Subsec. (a) including by adding references to director, officer and other person, designating existing provisions re pursuit of business opportunities as new Subdiv. (1), redesignating existing Subdivs. (1) and (2) as Subparas. (A) and (B), amending redesignated Subdiv. (1)(A) by deleting “as if the decision being made concerned a director’s conflicting interest transaction”, and adding new Subdiv. (2) re duty to offer corporation business opportunity limited or eliminated pursuant to provision of certificate of incorporation, and amended Subsec. (b) by replacing “improper taking advantage of a business opportunity by a director” with “improper pursuit or taking advantage of a business opportunity by a director or officer directly, or indirectly through or on behalf of another person”, replacing “interference” with “implication”, and made technical and conforming changes.
Secs. 33-786 to 33-794. Reserved for future use.
PART IX
AMENDMENT OF CERTIFICATE OF INCORPORATION
AND BYLAWS
(A)
AMENDMENT OF CERTIFICATE OF INCORPORATION
Sec. 33-795. Authority to amend. (a) A corporation may amend its certificate of incorporation at any time to add or change a provision that is required or permitted in the certificate of incorporation as of the effective date of the amendment or to delete a provision that is not required to be contained in the certificate of incorporation.
(b) A shareholder of the corporation does not have a vested property right resulting from any provision in the certificate of incorporation, including provisions relating to management, control, capital structure, dividend entitlement or purpose or duration of the corporation.
(P.A. 94-186, S. 120, 215; P.A. 96-271, S. 84, 254; P.A. 03-18, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) to make technical changes, effective July 1, 2003.
Sec. 33-796. Amendment by board of directors. Unless the certificate of incorporation provides otherwise, a corporation’s board of directors may adopt amendments to the corporation’s certificate of incorporation without shareholder approval: (1) To extend the duration of the corporation if it was incorporated at a time when limited duration was required by law; (2) to delete the names and addresses of the initial directors; (3) to delete the name and address of the initial registered agent or registered office, if a statement of change is on file with the Secretary of the State; (4) if the corporation has only one class of shares outstanding (A) to change each issued and unissued authorized share of the class into a greater number of whole shares of such class, or (B) to increase the number of authorized shares of the class to the extent necessary to permit the issuance of shares as a share dividend; (5) to change the corporate name by substituting the word “corporation”, “incorporated”, “company”, “Societa per Azioni” or “limited”, or the abbreviation “corp.”, “inc.”, “co.”, “S.p.A.” or “ltd.”, for a similar word or abbreviation in the name or by adding, deleting or changing a geographical attribution for the name; (6) to reflect a reduction in authorized shares, as a result of the operation of subsection (b) of section 33-684, when the corporation has acquired its own shares and the certificate of incorporation prohibits the reissue of the acquired shares; (7) to delete a class of shares from the certificate of incorporation, as a result of the operation of subsection (b) of section 33-684, when there are no remaining shares of the class because the corporation has acquired all shares of the class and the certificate of incorporation prohibits the reissue of the acquired shares; or (8) to make any other change expressly permitted by sections 33-600 to 33-998, inclusive, to be made without shareholder approval.
(P.A. 94-186, S. 121, 215; P.A. 96-271, S. 85, 254; P.A. 03-18, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-18 deleted reference to adoption of “one or more” amendments, replaced references to shareholder “action” with shareholder “approval”, amended Subdiv. (4) to designate existing provisions as Subpara. (A), make technical changes and add Subpara. (B) re increase in authorized shares to permit issuance of share dividend, added new Subdiv. (6) re reduction in authorized shares as a result of the operation of Sec. 33-684(b), added Subdiv. (7) re deletion of a class of shares as a result of the operation of Sec. 33-684(b), and redesignated existing Subdiv. (6) as Subdiv. (8), effective July 1, 2003.
Sec. 33-797. Amendment by board of directors and shareholders. (a) If a corporation has issued shares, an amendment to the certificate of incorporation shall be adopted as provided in this section. A proposed amendment must be adopted by the board of directors.
(b) Except as provided in sections 33-796, 33-801, and 33-802, after adopting the proposed amendment, the board of directors must submit the amendment to the shareholders for their approval. The board of directors must also transmit to the shareholders a recommendation that the shareholders approve the amendment, unless (1) the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation, or (2) section 33-754 applies. If subdivision (1) or (2) of this subsection applies, the board of directors must transmit to the shareholders the basis for so proceeding.
(c) The board of directors may condition its submission of the amendment to the shareholders on any basis.
(d) If the amendment is required to be approved by the shareholders, and the approval is to be given at a meeting, the corporation must notify each shareholder, whether or not entitled to vote, of the meeting of shareholders at which the amendment is to be submitted for approval. The notice must state that the purpose, or one of the purposes, of the meeting is to consider the amendment and must contain or be accompanied by a copy of the amendment.
(e) Unless sections 33-600 to 33-998, inclusive, the certificate of incorporation or the board of directors acting pursuant to subsection (c) of this section requires a greater vote or a vote by voting groups, and except as provided in subsection (f) of this section, the amendment to be adopted must be approved by: (1) A majority of the votes entitled to be cast on the amendment by any voting group with respect to which the amendment would create appraisal rights; and (2) the votes required by sections 33-709 and 33-710 by every other voting group entitled to vote on the amendment.
(f) Notwithstanding any provision of subsection (e) of this section to the contrary, an amendment to the certificate of incorporation of a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revision of 1958, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, and which at the time of any shareholder vote on such a proposed amendment has less than one hundred shareholders of record, shall, unless the certificate of incorporation of such corporation expressly provides otherwise, be approved by the affirmative vote of at least two-thirds of the voting power of each voting group entitled to vote thereon.
(P.A. 94-186, S. 122, 215; P.A. 96-271, S. 86–88, 254; P.A. 03-18, S. 10; P.A. 10-35, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (f) to replace “January 1, 1996” with “January 1, 1997”, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by replacing former provisions with provisions re adoption of amendment if corporation has issued shares and re adoption of proposed amendment by the board, amended Subsec. (b) by making technical changes, adding exception for provisions of Secs. 33-796, 33-801 and 33-802, replacing provision requiring the board to recommend the amendment to the shareholders in order for the amendment to be adopted with provision requiring the board to submit the amendment to the shareholders for their approval after the amendment is adopted, adding provision requiring the board to transmit to the shareholders a recommendation that the shareholders approve the amendment, deleting provisions re communication of basis for determination to the shareholders and re shareholder approval of the amendment as provided in Subsec. (e) and adding provision requiring board to transmit to the shareholders the basis for its determination not to recommend approval of the amendment, amended Subsec. (c) by replacing “submission of the proposed amendment” with “submission of the amendment to the shareholders”, amended Subsec. (d) by adding provision re notice if the amendment is required to be approved by the shareholders at a meeting, replacing provision re notice of proposed shareholder meeting in accordance with Sec. 33-699 with provision re notice of meeting of shareholders at which the amendment is to be submitted for approval, deleting references to proposed amendment and summary of the amendment and making technical changes, amended Subsec. (e) by replacing “dissenter’s rights” with “appraisal rights” and amended Subsec. (f) by making a technical change, effective July 1, 2003; P.A. 10-35 amended Subsec. (b) to designate existing provisions re board determination that it should not make a recommendation due to conflicts of interest or other special circumstances as Subdiv. (1), add Subdiv. (2) re whether Sec. 33-754 applies, and provide that if Subdiv. (1) or (2) applies, board must transmit to shareholders basis for so proceeding, rather than basis for determination.
Sec. 33-798. Voting on amendments by voting groups. (a) If a corporation has more than one class of shares outstanding, the holders of the outstanding shares of a class are entitled to vote as a separate voting group, if shareholder voting is otherwise required by sections 33-600 to 33-998, inclusive, on a proposed amendment to the certificate of incorporation if the amendment would:
(1) Effect an exchange or reclassification of all or part of the shares of the class into shares of another class;
(2) Effect an exchange or reclassification, or create the right of exchange, of all or part of the shares of another class into shares of the class;
(3) Change the rights, preferences or limitations of all or part of the shares of the class;
(4) Change the shares of all or part of the class into a different number of shares of the same class;
(5) Create a new class of shares having rights or preferences with respect to distributions that are prior or superior to the shares of the class;
(6) Increase the rights, preferences or number of authorized shares of any class that, after giving effect to the amendment, have rights or preferences with respect to distributions that are prior or superior to the shares of the class;
(7) Limit or deny an existing preemptive right of all or part of the shares of the class; or
(8) Cancel or otherwise affect rights to distributions that have accumulated but not yet been authorized on all or part of the shares of the class.
(b) If a proposed amendment would affect a series of a class of shares in one or more of the ways described in subsection (a) of this section, the holders of shares of that series are entitled to vote as a separate voting group on the proposed amendment.
(c) If a proposed amendment that entitles the holders of two or more classes or series of shares to vote as separate voting groups under this section would affect those two or more classes or series in the same or a substantially similar way, the holders of shares of all the classes or series so affected must vote together as a single voting group on the proposed amendment, unless otherwise provided in the certificate of incorporation or required by the board of directors.
(d) A class or series of shares is entitled to the voting rights granted by this section although the certificate of incorporation provides that the shares are nonvoting shares.
(P.A. 94-186, S. 123, 215; P.A. 96-271, S. 89, 254; P.A. 03-18, S. 11; P.A. 12-32, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (d) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by adding provision re voting as separate voting group if corporation has more than one class of shares outstanding, deleting former Subdiv. (1) re increase or decrease in aggregate number of authorized shares of the class, redesignating existing Subdivs. (2) to (9) as Subdivs. (1) to (8), deleting “designation” in Subdiv. (3), deleting “or substantially equal” in Subdivs. (5) and (6), deleting “or dividends” and replacing “declared” with “authorized” in Subdiv. (8) and making technical changes, amended Subsec. (b) by adding reference to holders of shares and amended Subsec. (c) by adding references to holders and classes and adding provision re unless otherwise provided in the certificate of incorporation or required by the board, effective July 1, 2003; P.A. 12-32 amended Subsec. (a) by deleting “or to dissolution” in Subdivs. (5) and (6).
Sec. 33-799. Amendment before issuance of shares. If a corporation has not yet issued shares, its board of directors, or the incorporators if it has no board of directors, may adopt one or more amendments to the corporation’s certificate of incorporation.
(P.A. 94-186, S. 124, 215; P.A. 96-271, S. 90, 254; P.A. 03-18, S. 12.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-18 replaced “incorporators or board of directors” with “board of directors, or the incorporators if it has no board of directors”, effective July 1, 2003.
Sec. 33-800. Certificate of amendment. After an amendment to the certificate of incorporation has been adopted and approved in the manner required by sections 33-600 to 33-998, inclusive, and by the certificate of incorporation, the corporation shall deliver to the Secretary of the State for filing a certificate of amendment, that shall set forth: (1) The name of the corporation; (2) the text of each amendment adopted, or the information required by subsection (l) of section 33-608; (3) if an amendment provides for an exchange, reclassification or cancellation of issued shares, provisions for implementing the amendment, if not contained in the amendment itself, which may be made dependent upon facts objectively ascertainable outside the certificate of amendment in accordance with subsection (l) of section 33-608; (4) the date of each amendment’s adoption; (5) if an amendment (A) was adopted by the incorporators or board of directors without shareholder approval, a statement that the amendment was duly approved by the incorporators or by the board of directors, as the case may be, and that shareholder approval was not required, or (B) required approval by the shareholders, a statement that the amendment was duly approved by the shareholders in the manner required by sections 33-600 to 33-998, inclusive, and by the certificate of incorporation; and (6) if an amendment is being filed pursuant to subsection (l) of section 33-608, a statement to that effect.
(P.A. 94-186, S. 125, 215; P.A. 96-271, S. 91, 254; P.A. 03-18, S. 13; 03-158, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation and “articles” of amendment with “certificate” of amendment, effective January 1, 1997; P.A. 03-18 replaced provision re corporation amending its certificate of incorporation with provision re after an amendment to the certificate of incorporation has been adopted and approved, amended Subdiv. (5) by replacing former provisions with provisions re statement if amendment was adopted without shareholder approval and re statement if amendment required shareholder approval, deleted former Subdiv. (6) re amendment approved by shareholders and made technical changes, effective July 1, 2003; P.A. 03-158 added provisions re information required by Sec. 33-608(l) in Subdiv. (2), added provisions re facts objectively ascertainable in accordance with Sec. 33-608(l) and made technical changes in Subdiv. (3), and added new Subdiv. (6) re amendment filed pursuant to Sec. 33-608(l).
Sec. 33-801. Restated certificate of incorporation. (a) A corporation’s board of directors may restate its certificate of incorporation at any time, with or without shareholder approval, to consolidate all amendments to the certificate of incorporation into a single document.
(b) If the restated certificate of incorporation includes one or more new amendments that require shareholder approval, the new amendments must be adopted and approved as provided in section 33-797.
(c) A corporation that restates its certificate of incorporation shall deliver to the Secretary of the State for filing a certificate of restatement setting forth the name of the corporation and the text of the restated certificate of incorporation together with (1) a statement that the restated certificate of incorporation consolidates all amendments into a single document, and (2) if a new amendment is included in the restated certificate of incorporation, the statement required under section 33-800.
(d) A duly adopted restated certificate of incorporation supersedes the original certificate of incorporation and all amendments to it.
(e) The Secretary of the State may certify a restated certificate of incorporation as the certificate of incorporation currently in effect, without including the statement information required by subsection (c) of this section.
(P.A. 94-186, S. 126, 215; P.A. 96-271, S. 92, 254; P.A. 97-246, S. 22, 23, 99; P.A. 03-18, S. 14.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (d) to replace “articles” of restatement with “certificate” of restatement, effective January 1, 1997; P.A. 97-246 amended Subsecs. (d) and (f) to replace “certificate” with “statement”, effective June 27, 1997; P.A. 03-18 amended Subsec. (a) by replacing “action” with “approval” and adding provision re consolidation of all amendments to the certificate of incorporation into a single document, amended Subsec. (b) by replacing provisions re inclusion in the restatement of one or more amendments to the certificate of incorporation and re inclusion of amendment requiring shareholder approval with provision re adoption and approval of one or more new amendments that require shareholder approval and are included in the restated certificate of incorporation, deleted former Subsec. (c) re notice to shareholders, redesignated existing Subsecs. (d) to (f) as new Subsecs. (c) to (e), amended Subsec. (c) by making a technical change, deleting former Subdivs. (1) and (2) and adding new Subdivs. (1) and (2) re statement that restated certificate of incorporation consolidates all amendments into a single document and re statement required under Sec. 33-800, and amended Subsec. (e) by making a technical change, effective July 1, 2003.
Sec. 33-802. Amendment pursuant to reorganization. (a) A corporation’s certificate of incorporation may be amended without action by the board of directors or shareholders to carry out a plan of reorganization ordered or decreed by a court of competent jurisdiction under a law of the United States.
(b) The individual or individuals designated by the court shall deliver to the Secretary of the State for filing a certificate of amendment setting forth: (1) The name of the corporation; (2) the text of each amendment approved by the court; (3) the date of the court’s order or decree approving the certificate of amendment; (4) the title of the reorganization proceeding in which the order or decree was entered; and (5) a statement that the court had jurisdiction of the proceeding under federal statute.
(c) This section does not apply after entry of a final decree in the reorganization proceeding even though the court retains jurisdiction of the proceeding for limited purposes unrelated to consummation of the reorganization plan.
(P.A. 94-186, S. 127, 215; P.A. 96-271, S. 93, 94, 254; P.A. 03-18, S. 15.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation and amended Subsec. (b) to replace “articles” of amendment with “certificate” of amendment, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by deleting provision re amendment without board or shareholder action if the certificate of incorporation after amendment contains only provisions required or permitted by Sec. 33-636 and replacing “federal statute” with “a law of the United States”, amended Subsec. (b) by replacing “federal law” with “federal statute”, deleted former Subsec. (c) re dissenters’ rights and redesignated existing Subsec. (d) as new Subsec. (c), effective July 1, 2003.
Sec. 33-803. Effect of amendment. An amendment to the certificate of incorporation does not affect a cause of action existing against or in favor of the corporation, a proceeding to which the corporation is a party or the existing rights of persons other than shareholders of the corporation. An amendment changing a corporation’s name does not abate a proceeding brought by or against the corporation in its former name.
(P.A. 94-186, S. 128, 215; P.A. 96-271, S. 95, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Secs. 33-804 and 33-805. Reserved for future use.
(B)
AMENDMENT OF BYLAWS
Sec. 33-806. Amendment by shareholders or board of directors. (a) A corporation’s shareholders may amend or repeal the corporation’s bylaws.
(b) A corporation’s board of directors may amend or repeal the corporation’s bylaws unless: (1) The certificate of incorporation, section 33-808 or, if applicable, section 33-809 reserves that power exclusively to the shareholders in whole or part; or (2) except as provided in subsection (d) of section 33-640, the shareholders in amending, repealing or adopting a bylaw expressly provide that the board of directors may not amend, repeal or reinstate that bylaw.
(P.A. 94-186, S. 129, 215; P.A. 96-271, S. 96, 254; P.A. 03-18, S. 16; P.A. 09-55, S. 16; P.A. 12-32, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-18 added new Subsec. (a) re shareholder amendment or repeal of bylaws, redesignated existing Subsec. (a) as new Subsec. (b) and amended same by deleting reference to Secs. 33-600 to 33-998, adding references to Sec. 33-808, adopting a bylaw and reinstating a bylaw and making technical changes, and deleted former Subsec. (b) re shareholder amendment or repeal of bylaws, effective July 1, 2003; P.A. 09-55 amended Subsec. (b) to add in Subdiv. (1) “or, if applicable, section 33-809”, to replace in Subdiv. (2) “a particular bylaw” with “a bylaw” and to make technical changes; P.A. 12-32 amended Subsec. (b)(2) to add exception to Sec. 33-640(d).
Board of directors can amend corporation’s bylaws, but only if bylaws or certificate of incorporation does not reserve such power to the shareholders. 72 CA 426.
Sec. 33-807. Bylaw increasing quorum or voting requirement for shareholders. (a) If authorized by the certificate of incorporation, the shareholders may adopt or amend a bylaw that fixes a greater quorum or voting requirement for shareholders or voting groups of shareholders than is required by sections 33-600 to 33-998, inclusive. The adoption or amendment of a bylaw that adds, changes or deletes a greater quorum requirement for shareholders must meet the same quorum requirement and be adopted by the same vote and voting groups required to take action under the quorum and voting requirement then in effect or proposed to be adopted, whichever is greater.
(b) A bylaw that fixes a greater quorum or voting requirement for shareholders under subsection (a) of this section may not be adopted, amended or repealed by the board of directors.
(P.A. 94-186, S. 130, 215; P.A. 96-271, S. 97, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-808. Bylaw increasing quorum or voting requirement for directors. (a) A bylaw that fixes a greater quorum or voting requirement for the board of directors or that requires a meeting of shareholders to be held at a place may be amended or repealed: (1) If originally adopted by the shareholders, only by the shareholders; (2) if originally adopted by the incorporator or incorporators or by the board of directors, either by the shareholders or by the board of directors.
(b) A bylaw adopted or amended by the shareholders that fixes a greater quorum or voting requirement for the board of directors may provide that it may be amended or repealed only by a specified vote of either the shareholders or the board of directors.
(c) Action by the board of directors under subdivision (2) of subsection (a) of this section to adopt or amend a bylaw that changes the quorum or voting requirement for the board of directors must meet the same quorum requirement and be adopted by the same vote required to take action under the quorum and voting requirement then in effect or proposed to be adopted, whichever is greater.
(P.A. 94-186, S. 131, 215; P.A. 21-39, S. 16.)
History: P.A. 94-186 effective January 1, 1997; P.A. 21-39 amended Subsec. (a) by adding “or that requires a meeting of shareholders to be held at a place” and adding “by the incorporator or incorporators or” in Subdiv. (2), effective June 14, 2021.
Sec. 33-809. Bylaw provisions relating to the election of directors. (a) Unless the certificate of incorporation specifically prohibits the adoption of a bylaw pursuant to this section, alters the vote specified in subsection (a) of section 33-712 or provides for cumulative voting, a public corporation may elect in its bylaws to be governed in the election of directors as follows:
(1) Each vote entitled to be cast may be voted for or against up to that number of candidates that is equal to the number of directors to be elected, or a shareholder may indicate an abstention, but without cumulating the votes;
(2) To be elected, a nominee must have received a plurality of the votes cast by holders of shares entitled to vote in the election at a meeting at which a quorum is present, provided a nominee who is elected but receives more votes against than for election shall serve as a director for a term that shall terminate on the date that is the earlier of (A) ninety days from the date on which the voting results are determined pursuant to subdivision (5) of subsection (b) of section 33-713, or (B) the date on which an individual is selected by the board of directors to fill the office held by such director, which selection shall be deemed to constitute the filling of a vacancy by the board to which section 33-744 applies. Subject to subdivision (3) of this subsection, a nominee who is elected but receives more votes against than for election shall not serve as a director beyond the ninety-day period specified in subparagraph (A) of this subdivision; and
(3) The board of directors may select any qualified individual to fill the office held by a director who received more votes against than for election.
(b) Subsection (a) of this section does not apply to an election of directors by a voting group if (1) at the expiration of the time fixed under a provision requiring advance notification of director candidates, or (2) absent such a provision, at a time fixed by the board of directors which is not more than fourteen days before notice is given of the meeting at which the election is to occur, there are more candidates for election by the voting group than the number of directors to be elected, one or more of whom are properly proposed by shareholders. An individual shall not be considered a candidate for purposes of this subsection if the board of directors determines before the notice of meeting is given that such individual’s candidacy does not create a bona fide election contest.
(c) A bylaw electing to be governed by this section may be repealed:
(1) If originally adopted by the shareholders, only by the shareholders, unless the bylaw otherwise provides; or
(2) If adopted by the board of directors, by the board of directors or the shareholders.
(P.A. 09-55, S. 13.)
Secs. 33-810 to 33-813. Reserved for future use.
PART X
MERGER AND SHARE EXCHANGE
Sec. 33-814. Definitions. As used in this section and sections 33-815 to 33-821a, inclusive:
(1) “Acquired corporation” means the domestic or foreign corporation that will have all of one or more classes or series of its shares acquired in a share exchange.
(2) “Acquiring corporation” means the domestic or foreign corporation that will acquire all of one or more classes or series of shares of the acquired corporation in a share exchange.
(3) “Interests” means the proprietary interests in an other entity.
(4) “Organizational documents” means the basic document or documents that create, or determine the internal governance of, an other entity.
(5) “Other entity” means any association or legal entity, other than a domestic or foreign corporation, organized to conduct business, including, but not limited to, a partnership, limited partnership, limited liability partnership, limited liability company, joint venture, joint stock company, business trust, statutory trust and real estate investment trust.
(6) “Party to a merger” means any domestic or foreign corporation or other entity that will merge under a plan of merger.
(7) “Party to a share exchange” means any domestic or foreign corporation or other entity that will: (A) Acquire shares or interests of another corporation or an other entity in a share exchange; or (B) have all of its shares or interests or all of one or more classes or series of its shares or interests acquired in a share exchange.
(8) “Survivor” means, in a merger, the corporation or other entity into which one or more other corporations or other entities are merged. A survivor of a merger may preexist the merger or be created by the merger.
(P.A. 03-18, S. 17; P.A. 17-108, S. 22.)
History: P.A. 03-18 effective July 1, 2003; P.A. 17-108 added new Subdivs. (1) and (2) defining “acquired corporation” and “acquiring corporation”, respectively, redesignated existing Subdiv. (1) as Subdiv. (3), deleted former Subdiv. (2) defining “merger”, redesignated existing Subdivs. (3) to (6) as Subdivs. (4) to (7) and deleted former Subdiv. (7) defining “share exchange”.
Sec. 33-815. Merger. (a) One or more domestic corporations may, in accordance with the provisions of this section, merge with one or more domestic or foreign corporations pursuant to a plan of merger.
(b) A foreign corporation may be a party to a merger, or may be created by the terms of a plan of merger, only if: (1) The merger is permitted by the law of the state or country under which such corporation is organized or by which it is governed; and (2) in effecting the merger, such corporation complies with such law and with its certificate of incorporation.
(c) The plan of merger shall include: (1) The name of each corporation that will merge and the name of the corporation that will be the survivor of the merger; (2) the terms and conditions of the merger; (3) the manner and basis of converting the shares of each merging corporation into shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof; (4) the certificate of incorporation of any corporation to be created by the merger or, if a new corporation is not to be created by the merger, any amendments to the survivor’s certificate of incorporation; and (5) any other provisions required by the law of the state or country under which any party to the merger is organized or by which it is governed, or by the certificate of incorporation or organizational documents of any such party.
(d) Terms of a plan of merger may be made dependent on facts objectively ascertainable outside the plan in accordance with subsection (l) of section 33-608.
(e) The plan of merger may also include a provision that the plan may be amended prior to filing a certificate of merger with the Secretary of the State, provided, if the shareholders of a domestic corporation that is a party to the merger are required or permitted to vote on the plan, the plan shall provide that, subsequent to approval of the plan by such shareholders, the plan may not be amended to: (1) Change the amount or kind of shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property to be received by the shareholders of or owners of interests in any party to the merger upon conversion of their shares or interests under the plan; (2) change the certificate of incorporation of any corporation that will survive or be created as a result of the merger, except for changes permitted by section 33-796 or by comparable provisions of the law of the state or country under which the foreign corporation is organized or by which it is governed; or (3) change any of the other terms or conditions of the plan if the change would adversely affect such shareholders in any material respect.
(P.A. 94-186, S. 132, 215; P.A. 96-271, S. 98, 254; P.A. 03-18, S. 18; 03-158, S. 10; P.A. 04-50, S. 1; 04-99, S. 1; P.A. 11-241, S. 35.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (c) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by adding provision re merger of domestic corporations in accordance with the provisions of section, deleting provision re adoption of plan of merger by board of each corporation and approval of plan by shareholders if required by Sec. 33-817, and adding provision re merger with a domestic or foreign corporation or other entity pursuant to a plan of merger, added new Subsec. (b) re foreign corporation or domestic or foreign other entity may be party to or created by merger, redesignated existing Subsec. (b) as new Subsec. (c) and amended same by replacing “corporation planning to merge” with “corporation or other entity that will merge” and replacing “surviving corporation into which each other corporation plans to merge” with “corporation or other entity that will be the survivor of the merger” in Subdiv. (1), replacing provisions re conversion of shares of each corporation with provisions re conversion of shares of each merging corporation and interests of each merging other entity in Subdiv. (3), adding Subdiv. (4) re inclusion of certificate of incorporation or organizational documents, adding Subdiv. (5) re inclusion of other provisions and making technical changes, deleted former Subsec. (c) re provisions set forth in plan of merger, added Subsec. (d) re terms of plan of merger made dependent on facts objectively ascertainable outside the plan, and added Subsec. (e) re amendment of plan of merger, effective July 1, 2003; P.A. 03-158 added Subsec. (f) re terms dependent on facts objectively ascertainable outside the plan; P.A. 04-50 deleted former Subsec. (d) re terms of plan of merger made dependent on facts objectively ascertainable outside the plan and redesignated provisions of existing Subsec. (f) re terms dependent on facts objectively ascertainable outside the plan as new Subsec. (d), effective May 4, 2004; P.A. 04-99 amended Subsec. (a) by replacing “a domestic or foreign corporation or other entity” with “one or more domestic or foreign corporations or other entities”, effective May 10, 2004; P.A. 11-241 deleted provisions re other entities and organizational documents and, in Subsecs. (c) and (e), changed “must” to “shall”, effective January 1, 2014.
Sec. 33-816. Share exchange. (a) Through a share exchange: (1) A domestic corporation may acquire all of the shares of one or more classes or series of shares of another domestic corporation or of a foreign corporation, in exchange for shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof, pursuant to a plan of share exchange; or (2) all of the shares of one or more classes or series of shares of a domestic corporation may be acquired by another domestic corporation or by a foreign corporation, in exchange for shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof, pursuant to a plan of share exchange.
(b) A foreign corporation may be a party to a share exchange only if: (1) The share exchange is permitted by the law of the state or country under which such corporation is organized or by which it is governed; and (2) in effecting the share exchange, such corporation complies with such law and with its certificate of incorporation or organizational documents.
(c) The plan of share exchange shall include: (1) The name of each corporation whose shares will be acquired and the name of the corporation or other entity that will acquire such shares; (2) the terms and conditions of the share exchange; (3) the manner and basis of exchanging shares of a corporation whose shares will be acquired under the share exchange into shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof; and (4) any other provisions required by the law of the state or country under which any party to the share exchange is organized or by which it is governed or by the certificate of incorporation or organizational documents of any such party.
(d) Terms of a plan of share exchange may be made dependent on facts objectively ascertainable outside the plan in accordance with subsection (l) of section 33-608.
(e) The plan of share exchange may also include a provision that the plan may be amended prior to the filing of a certificate of share exchange with the Secretary of the State, provided, if the shareholders of a domestic corporation that is a party to the share exchange are required or permitted to vote on the plan, the plan shall provide that, subsequent to approval of the plan by such shareholders, the plan may not be amended to: (1) Change the amount or kind of shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property to be issued by the corporation or to be received by the shareholders of in any party to the share exchange in exchange for their shares under the plan; or (2) change any of the terms or conditions of the plan if the change would adversely affect such shareholders in any material respect.
(f) This section does not limit the power of a domestic corporation to acquire shares of another corporation or interests in an other entity in a transaction other than a share exchange.
(P.A. 94-186, S. 133, 215; P.A. 03-18, S. 19; 03-158, S. 11; P.A. 04-50, S. 2; P.A. 11-241, S. 36.)
History: P.A. 94-186 effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by adding “Through a share exchange”, replacing “corporation” with “domestic corporation” and “outstanding shares” with “shares”, deleting provision re adoption of exchange by board of each corporation and approval of exchange by shareholders if required by Sec. 33-817, adding Subdiv. (1) re acquisition by domestic corporation of shares of domestic or foreign corporation or interests of domestic or foreign other entity pursuant to plan of share exchange, and adding Subdiv. (2) re acquisition by domestic or foreign corporation or other entity of shares of domestic corporation pursuant to plan of share exchange, deleted former Subsecs. (b), (c) and (d) re plan of exchange and power to acquire shares through voluntary exchange or otherwise, added new Subsec. (b) re foreign corporation or domestic or foreign other entity may be party to share exchange, added new Subsec. (c) re requirements for plan of share exchange, added new Subsec. (d) re terms of plan of share exchange made dependent on facts objectively ascertainable outside the plan, added Subsec. (e) re amendment of plan of share exchange, and added Subsec. (f), redesignated as Subsec. (g) by the Revisors to allow insertion of Subsec. added by P.A. 03-158 as Subsec. (f), re power to acquire shares or interests in transaction other than a share exchange, effective July 1, 2003; P.A. 03-158 added new Subsec., designated as Subsec. (f) by the Revisors, re terms dependent on facts objectively ascertainable outside the plan; P.A. 04-50 deleted former Subsec. (d) re terms of plan of share exchange made dependent on facts objectively ascertainable outside the plan, redesignated provisions of existing Subsec. (f) re terms dependent on facts objectively ascertainable outside the plan as new Subsec. (d) and redesignated existing Subsec. (g) re power to acquire shares or interests in transaction other than a share exchange as new Subsec. (f), effective May 4, 2004; P.A. 11-241 deleted provisions re other entities and interests in such entities and, in Subsecs. (c) and (e), changed “must” to “shall”, effective January 1, 2014.
Sec. 33-817. Action on plan of merger or share exchange. In the case of a domestic corporation that is a party to a merger or the acquired corporation in a share exchange, the plan of merger or share exchange shall be adopted in the following manner:
(1) The plan of merger or share exchange shall first be adopted by the board of directors.
(2) Except as provided in subdivisions (8), (10) and (12) of this section and section 33-818, the plan of merger or share exchange shall then be approved by the shareholders. In submitting the plan of merger or share exchange to the shareholders for approval, the board of directors shall recommend that the shareholders approve the plan, or, in the case of an offer referred to in subparagraph (B) of subdivision (10) of this section, that the shareholders tender their shares to the offeror in response to the offer, unless (A) the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation, or (B) section 33-754 applies. If either subparagraph (A) or (B) of this subdivision applies, the board of directors shall inform the shareholders of the basis for its so proceeding.
(3) The board of directors may set conditions for the approval of the plan of merger or share exchange by the shareholders or the effectiveness of the plan of merger or share exchange.
(4) If the plan of merger or share exchange is required to be approved by the shareholders, and if the approval is to be given at a meeting, the corporation shall notify each shareholder, regardless of whether entitled to vote, of the meeting of shareholders at which the plan is to be submitted for approval. The notice must state that the purpose, or one of the purposes, of the meeting is to consider the plan and must contain or be accompanied by a copy or summary of the plan. If the corporation is to be merged into an existing foreign or domestic corporation, the notice must also include or be accompanied by a copy or summary of the certificate of incorporation and bylaws of that corporation. If the corporation is to be merged with a domestic or foreign corporation and a new domestic or foreign corporation is to be created pursuant to the merger, the notice must include or be accompanied by a copy or a summary of the certificate of incorporation and bylaws of the new corporation.
(5) Unless the certificate of incorporation, or the board of directors acting pursuant to subdivision (3) of this section, requires a greater vote or a greater quorum, approval of the plan of merger or share exchange requires the approval of the shareholders at a meeting at which a quorum exists consisting of a majority of the votes entitled to be cast on the plan, and, if any class or series of shares is entitled to vote as a separate group on the plan of merger or share exchange, the approval of each such separate voting group at a meeting at which a quorum of the voting group is present consisting of a majority of the votes entitled to be cast on the plan of merger or share exchange by that voting group.
(6) Subject to subdivision (7) of this section, separate voting by voting groups is required: (A) On a plan of merger, by each class or series of shares that: (i) Are to be converted under the plan of merger into shares, other securities, interests, obligations, rights to acquire shares or other securities or interests, cash, other property, or any combination thereof; or (ii) are entitled to vote as a separate group on a provision in the plan that, constitutes a proposed amendment to the certificate of incorporation of a surviving corporation that requires action by separate voting groups under section 33-798; (B) on a plan of share exchange, by each class or series of shares included in the exchange, with each class or series constituting a separate voting group; and (C) on a plan of merger or share exchange, if the voting group is entitled under the certificate of incorporation to vote as a voting group to approve a plan of merger or share exchange, respectively.
(7) The certificate of incorporation may expressly limit or eliminate the separate voting rights provided in subparagraph (A)(i) of subdivision (6) of this section and in subparagraph (B) of subdivision (6) of this section as to any class or series of shares, except when the plan of merger or share exchange (A) includes what is or would be in effect an amendment subject to subparagraph (A)(ii) of subdivision (6) of this section, and (B) will not effect a substantive business combination.
(8) Unless the certificate of incorporation otherwise provides, approval by the corporation’s shareholders of a plan of merger is not required if: (A) The corporation will survive the merger; (B) except for amendments permitted by section 33-796, its certificate of incorporation will not be changed; and (C) each shareholder of the corporation whose shares were outstanding immediately before the effective date of the merger will hold the same number of shares, with identical preferences, rights and limitations, immediately after the effective date of the merger.
(9) If, as a result of a merger or a share exchange, one or more shareholders of a domestic corporation would become subject to personal liability for the obligations or liabilities of any other person or entity, approval of the plan of merger or share exchange requires the signing in connection with the transaction, by each such shareholder, of a separate written consent to become subject to such personal liability.
(10) Unless the certificate of incorporation otherwise provides, approval by the shareholders of a plan of merger or share exchange is not required if: (A) The plan of merger or share exchange expressly (i) permits or requires the merger or share exchange to be effected under this subdivision, and (ii) provides that, if the merger or share exchange is to be effected under this subdivision, the merger or share exchange will be effected as soon as practicable following the satisfaction of the requirement set forth in subparagraph (F) of this subdivision; (B) another party to the merger, the acquiring corporation in the share exchange, or a parent of another party to the merger or the acquiring corporation in the share exchange, makes an offer to purchase, on the terms provided in the plan of merger or share exchange, any and all of the outstanding shares of the corporation that, absent the provisions of this subdivision, would be entitled to vote on the plan of merger or share exchange, except that the offer may exclude shares of the corporation that are owned at the commencement of the offer by the corporation, the offeror or any parent of the offeror, or by any wholly owned subsidiary of the corporation, the offeror or by any wholly owned subsidiary of any of them; (C) the offer discloses that the plan of merger or share exchange provides that the merger or share exchange will be effected as soon as practicable following the satisfaction of the requirement set forth in subparagraph (F) of this subdivision and that the shares of the corporation that are not tendered in response to the offer will be treated as set forth in subparagraph (H) of this subdivision; (D) the offer remains open for at least ten days; (E) the offeror purchases all shares properly tendered in response to the offer and not properly withdrawn; (F) the shares set forth in this subparagraph are collectively entitled to cast at least the minimum number of votes on the merger or share exchange that, absent the provisions of this subdivision, would be required by sections 33-814 to 33-821a, inclusive, and by the certificate of incorporation for the approval of the merger or share exchange by the shareholders and by any other voting group entitled to vote on the merger or share exchange at a meeting at which all shares entitled to vote on the approval were present and voted: (i) Shares purchased by the offeror in accordance with the offer; (ii) shares otherwise owned by the offeror or by any parent of the offeror or any wholly owned subsidiary of the offeror or by any parent of the offeror; and (iii) shares subject to an agreement that are to be transferred, contributed or delivered to the offeror, any parent of the offeror or any wholly owned subsidiary of any of them in exchange for shares in such offeror, parent or subsidiary; (G) the offeror or a wholly owned subsidiary of the offeror merges with or into, or effects a share exchange in which it acquires shares of the corporation; and (H) each outstanding share of each class or series of shares of the corporation that the offeror is offering to purchase in accordance with the offer, and that is not purchased in accordance with the offer, is to be converted in the merger into, or into the right to receive, or is to be exchanged in the share exchange for, or for the right to receive, the same amount and kind of securities, interests, obligations, rights, cash or other property to be paid or exchanged in accordance with the offer for each share of that class or series of shares that is tendered in response to the offer, except that shares of the corporation that are owned by the corporation or that are described in subparagraph (F)(ii) or (iii) of this subdivision need not be converted into or exchanged for the consideration described in this subparagraph.
(11) As used in subdivision (10) of this section, (A) “offer” means the offer referred to in subparagraph (B) of subdivision (10) of this section; (B) “offeror” means the person making the offer; (C) “parent” of a corporation means a person that owns, directly or indirectly, through one or more wholly owned subsidiaries, all of the outstanding shares of that corporation; (D) shares tendered in response to the offer shall be deemed to have been “purchased” in accordance with the offer at the earliest time as of which (i) the offeror has irrevocably accepted those shares for payment, and (ii) either (I) in the case of shares represented by certificates, the offeror, or the offeror’s designated depository or other agent, has physically received the certificates representing those shares, or (II) in the case of shares without certificates, those shares have been transferred into the account of the offeror or its designated depository or other agent, or an agent’s message relating to those shares has been received by the offeror or its designated depository or other agent; and (E) “wholly owned subsidiary” of a person means an entity of or in which that person owns, directly or indirectly, through one or more wholly owned subsidiaries, all of the outstanding shares or interests.
(12) Unless the certificate of incorporation otherwise provides, (A) approval of a plan of share exchange by the shareholders of a domestic corporation is not required if the corporation is the acquiring corporation in the share exchange; and (B) shares not to be exchanged under the plan of share exchange are not entitled to vote on the plan.
(13) Notwithstanding any provision of subdivision (5) of this section, a plan of merger or share exchange of a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revision of 1958, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, to be authorized by such corporation, shall be approved by (A) the affirmative vote of at least two-thirds of the voting power of each voting group entitled to vote thereon unless (i) the certificate of incorporation expressly provides otherwise, or (ii) approval by the corporation’s shareholders of the plan of merger or share exchange is not required under either subdivision (8) or (10) of this section, and (B) the affirmative vote of at least two-thirds of the voting power of each class of stock of such corporation outstanding prior to January 1, 1997, and not otherwise entitled to vote thereon, unless (i) the certificate of incorporation expressly provides otherwise; or (ii) approval by the corporation’s shareholders of the plan of merger or share exchange is not required under either subdivision (8) or (10) of this section.
(P.A. 94-186, S. 134, 215; P.A. 96-271, S. 99–103, 254; P.A. 03-18, S. 20; P.A. 10-35, S. 7; P.A. 11-241, S. 37; P.A. 17-108, S. 15.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, amended Subsec. (i) to replace “articles” of merger or share exchange with “certificate” of merger or share exchange and amended Subsec. (j) to replace “January 1, 1996” with “January 1, 1997”, effective January 1, 1997; P.A. 03-18 substantially revised section, deleting former Subsecs. (a) and (b), adding provision re domestic corporation that is a party to a merger or share exchange, adding Subdivs. (1) and (2) re adoption of plan by board and submission of plan to shareholders for approval, redesignating Subsecs. (c) to (g) as Subdivs. (3) to (7) and adding provisions re shareholder approval and meeting, re copy or summary of certificate of incorporation or organizational documents included in shareholder notice, re separate voting by each class or series of shares and by voting group and re when shareholder approval of plan is not required unless the certificate of incorporation otherwise provides, deleting former Subsecs. (g)(3) and (4), (h) and (i), adding Subdiv. (8) re consent to personal liability, redesignating Subsec. (j) as Subdiv. (9), and making conforming and technical changes throughout, effective July 1, 2003; P.A. 10-35 amended Subdiv. (2) to designate existing provisions re board determination that it should not make a recommendation due to conflicts of interest or other special circumstances as Subpara. (A), add Subpara. (B) re whether Sec. 33-754 applies, and provide that if Subpara. (A) or (B) applies, board must transmit to shareholders basis for so proceeding, rather than basis for determination; P.A. 11-241 amended Subdiv. (4) to delete provisions re other entity and organizational documents and change “must” to “shall”, effective January 1, 2014; P.A. 17-108 substantially amended section including by adding reference to acquired corporation, adding “, the plan of merger or share exchange shall be adopted in the following manner”, replacing “must” with “shall first” in Subdiv. (1), replacing reference to Subdiv. (7) with reference to Subdivs. (8), (10) and (12), deleting provision re board must submit plan to shareholders, and adding provisions re plan or share exchange to be approved by shareholders and shareholders to tender shares to offeror in response to offer in Subdiv. (2), replacing “on any basis” with “or the effectiveness of the plan of merger or share exchange” in Subdiv. (3), replacing “shall” with “must”, replacing references to corporation with references to domestic or foreign corporation, and adding references to bylaws in Subdiv. (4), replacing provisions re approval by voting group with provisions re same in Subdiv. (5), adding reference to Subdiv. (7), adding “or interests”, replacing “if contained in” with “constitutes”, and replacing “, would require” with “of a surviving corporation that requires” in Subdiv. (6), adding new Subdiv. (7) re separate voting rights, redesignating existing Subdiv. (7) as new Subdiv. (8) and amending same to delete references to share exchange, redesignating existing Subdiv. (8) as new Subdiv. (9) and amending same to replace “execution” with “signing in connection with the transaction”, adding Subdiv. (10) re approval by shareholders of plan of merger or share exchange not required, adding Subdiv. (11) re definitions, adding Subdiv. (12) re approval of plan of share exchange by shareholders not required, redesignating existing Subdiv. (9) as Subdiv. (13) and amending same to delete provisions re if corporation is surviving corporation of such merger, and adding provisions re approval by shareholders of plan of merger or share exchange not required, and making technical and conforming changes.
Sec. 33-818. Merger of subsidiary. (a) A domestic parent corporation that owns shares of a domestic or foreign subsidiary corporation that carry at least ninety per cent of the voting power of each class and series of the outstanding shares of the subsidiary that have voting power may merge the subsidiary into itself or into another such subsidiary, or merge itself into the subsidiary, without the approval of the board of directors or shareholders of the subsidiary, unless (1) the certificate of incorporation of any of the corporations otherwise provides, and (2) in the case of a foreign subsidiary, approval by the foreign subsidiary’s board of directors or shareholders is required by the law under which the subsidiary is organized.
(b) If under subsection (a) of this section approval of a merger by the subsidiary’s shareholders is not required, the parent corporation shall, within ten days after the effective date of the merger, notify each of the subsidiary’s shareholders that the merger has become effective.
(c) Except as provided in subsections (a) and (b) of this section, a merger between a parent and a subsidiary shall be governed by the provisions of sections 33-815 to 33-829, inclusive, applicable to mergers generally.
(P.A. 94-186, S. 135, 215; P.A. 96-271, S. 104, 105, 254; P.A. 03-18, S. 21; P.A. 09-55, S. 28.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of merger with “certificate” of merger and “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by replacing former provisions with provisions re merger of domestic or foreign subsidiary corporation with domestic parent corporation or another subsidiary, deleted former Subsecs. (b), (c), (d) and (e) re plan and certificate of merger, added new Subsec. (b) re notice to subsidiary’s shareholders and added new Subsec. (c) re applicable law, effective July 1, 2003; P.A. 09-55 amended Subsec. (a) to authorize merger “without the approval of the board of directors or shareholders of the subsidiary” and delete in Subdiv. (2) exception re when approval of merger by foreign subsidiary’s board of directors or shareholders is required by the law by which subsidiary is governed, and amended Subsec. (b) to make a technical change.
Sec. 33-819. Certificate of merger or share exchange. (a) After a plan of merger or share exchange has been adopted and approved as required by sections 33-600 to 33-998, inclusive, a certificate of merger or share exchange shall be signed on behalf of each party to the merger or the share exchange by any officer or other duly authorized representative of such party. The certificate of merger or share exchange shall set forth: (1) The names of the parties to the merger or the share exchange; (2) the name of the corporation that will be the survivor of the merger or that will acquire the shares of the other party to the share exchange; (3) the date on which the merger or the share exchange is to be effective; (4) if the certificate of incorporation of the survivor of a merger is amended, or if a new corporation is created as a result of a merger, the amendments to the survivor’s certificate of incorporation or the certificate of incorporation of the new corporation; (5) if the plan of merger or share exchange required approval by the shareholders of a domestic corporation that was a party to the merger or the share exchange, a statement that the plan was duly approved by the shareholders and, if voting by any separate voting group was required, by each such separate voting group, in the manner required by sections 33-600 to 33-998, inclusive, and the certificate of incorporation; (6) if the plan of merger or share exchange did not require approval by the shareholders of a domestic corporation that was a party to the merger or the share exchange, a statement to that effect; and (7) as to each foreign corporation that was a party to the merger or the share exchange, a statement that the plan and the performance of its terms were duly authorized by all action required by the law of the state or country under which the corporation is organized or by which it is governed, and by its certificate of incorporation.
(b) A certificate of merger or share exchange shall be delivered to the Secretary of the State for filing by the survivor of the merger or the acquiring corporation in a share exchange and shall take effect on the effective date of the merger or the share exchange.
(P.A. 94-186, S. 136, 215; P.A. 96-271, S. 106, 254; P.A. 03-18, S. 22; P.A. 11-147, S. 18; 11-241, S. 38; P.A. 12-32, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of merger or share exchange with “certificate” of merger or share exchange where appearing, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by replacing former provisions with provisions re execution and contents of certificate of merger or share exchange, and amended Subsec. (b) by deleting provision re when merger or share exchange takes effect and adding provisions re filing and effective date of certificate of merger or share exchange, effective July 1, 2003; P.A. 11-147 amended Subsec. (a) to require certificate of merger or share exchange be “signed” rather than “executed”; P.A. 11-241 amended Subsec. (a) to delete provisions re other entity, interests in such entity and organizational documents, effective January 1, 2014; P.A. 12-32 amended Subsec. (a) to require certificate of merger or share exchange to be “signed”, rather than “executed”, effective January 1, 2014.
Sec. 33-820. Effect of merger or share exchange. (a) When a merger becomes effective:
(1) The corporation that is designated in the certificate of merger as the survivor continues or comes into existence, as the case may be;
(2) The separate existence of every corporation that is merged into the survivor ceases;
(3) All liabilities of each corporation that is merged into the survivor are vested in the survivor;
(4) All property owned by, and every contract right possessed by, each corporation that merges into the survivor is vested in the survivor without reversion or impairment;
(5) The name of the survivor may, but need not be, substituted in any pending proceeding for the name of any party to the merger whose separate existence ceased in the merger;
(6) The certificate of incorporation of the survivor are amended to the extent provided in the certificate of merger;
(7) The certificate of incorporation of a survivor that is created by the merger become effective; and
(8) The shares of each corporation that is a party to the merger that are to be converted under the plan of merger into shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof, are converted, and the former holders of such shares or interests are entitled only to the rights provided to them in the plan of merger or to any rights they may have under sections 33-855 to 33-879, inclusive.
(b) When a share exchange becomes effective, the former holders of shares of each domestic corporation that are to be exchanged for shares or other securities, interests, obligations, rights to acquire shares or other securities, cash or other property, or any combination thereof, are entitled only to the rights provided to them in the plan of share exchange or to any rights they may have under sections 33-855 to 33-879, inclusive.
(c) Any shareholder of a domestic corporation that is a party to a merger or a share exchange and, prior to the merger or the share exchange, was liable for the liabilities or obligations of such corporation, shall not be released from such liabilities or obligations by reason of the merger or the share exchange.
(d) Upon a merger becoming effective, a foreign corporation that is the survivor of the merger is deemed to: (1) Appoint the Secretary of the State as its agent for service of process in a proceeding to enforce the rights of shareholders of each domestic corporation that is a party to the merger who exercise appraisal rights; and (2) agree that it shall promptly pay the amount, if any, to which such shareholders are entitled under sections 33-855 to 33-879, inclusive.
(P.A. 94-186, S. 137, 215; P.A. 96-271, S. 107, 254; P.A. 03-18, S. 23; P.A. 11-241, S. 39, 40.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to replace “articles” of incorporation with “certificate” of incorporation in Subdiv. (5) and “articles” of merger with “certificate” of merger in Subdiv. (6) and amended Subsec. (b) to replace “articles” of share exchange with “certificate” of share exchange, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by replacing “takes effect” with “becomes effective”, deleting former Subdivs. (1) to (6) and adding new Subdivs. (1) to (8) re when a merger becomes effective, amended Subsec. (b) by deleting provisions re exchange of shares of acquired corporation as provided in plan when share exchange takes effect, adding provisions re rights of former holders of shares of domestic corporation that are to be exchanged when share exchange becomes effective, and replacing “exchange rights provided” with “rights provided to them”, “certificate” with “plan”, “their rights” with “any rights they may have” and “33-872” with “33-879”, added Subsec. (c) re shareholder liabilities and obligations, and added Subsec. (d) re foreign corporation or other entity that is the survivor, effective July 1, 2003; P.A. 11-241 amended Subsec. (a) to delete provisions re other entity, organizational documents and interests in such entity and amended Subsec. (d) to delete provision re foreign other entity and change “will” to “shall”, effective January 1, 2014.
Sec. 33-821. Merger or share exchange with foreign corporation. Section 33-821 is repealed, effective July 1, 2003.
(P.A. 94-186, S. 138, 215; P.A. 97-246, S. 24, 99; P.A. 03-18, S. 76.)
Sec. 33-821a. Abandoned merger or share exchange. (a) Unless otherwise provided in a plan of merger or share exchange or in the law of the state or country under which a foreign corporation or a domestic or foreign other entity that is a party to a merger or a share exchange is organized or by which it is governed, after the plan has been adopted and approved as required by sections 33-815 to 33-820, inclusive, and at any time before the merger or the share exchange has become effective, the merger or the share exchange may be abandoned by any party thereto without action by the party’s shareholders or owners of interests, in accordance with any procedures set forth in the plan of merger or share exchange or, if no such procedures are set forth in the plan, in the manner determined by the board of directors of a corporation, or the managers of an other entity, subject to any contractual rights of other parties to the merger or the share exchange.
(b) If a merger or a share exchange is abandoned under subsection (a) of this section after a certificate of merger or share exchange has been filed with the Secretary of the State but before the merger or the share exchange has become effective, a statement that the merger or the share exchange has been abandoned in accordance with this section, signed on behalf of a party to the merger or the share exchange by an officer or other duly authorized representative of such party, shall be delivered to the Secretary of the State for filing prior to the effective date of the merger or the share exchange. Any such statement shall contain the name of each party to the merger or the share exchange, the date the merger or the share exchange was to become effective and the date the merger or the share exchange was abandoned. Upon filing, the statement shall take effect and the merger or the share exchange shall be deemed abandoned and shall not become effective.
(P.A. 03-18, S. 24; P.A. 11-147, S. 19.)
History: P.A. 03-18 effective July 1, 2003; P.A. 11-147 amended Subsec. (b) to require statement of abandonment be “signed” rather than “executed”.
Secs. 33-822 to 33-829. Reserved for future use.
PART XI
SALE OF ASSETS
Sec. 33-830. Sale or other disposition of assets in regular course of business. Mortgage or other encumbrance, transfer or distribution of assets. No approval of the shareholders of a corporation is required, unless the certificate of incorporation otherwise provides: (1) To sell, lease, exchange or otherwise dispose of any or all of the corporation’s assets in the usual and regular course of business; (2) to mortgage, pledge, dedicate to the repayment of indebtedness, whether with or without recourse, or otherwise encumber any or all of the corporation’s assets, whether or not in the usual and regular course of business; (3) to transfer any or all of the corporation’s assets to one or more corporations or other entities, all of the shares or interests of which are owned by the corporation; or (4) to distribute assets pro rata to the holders of one or more classes or series of the corporation’s shares.
(P.A. 94-186, S. 139, 215; P.A. 96-271, S. 108, 254; P.A. 03-18, S. 25.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-18 deleted Subsec. (a) designator and provision re sale by corporation on terms and conditions and for consideration determined by the board, added provisions re approval of shareholders not required unless certificate of incorporation otherwise provides, replaced “all, or substantially all, of its property” with “any or all of the corporation’s assets” in Subdiv. (1), replaced “its property” with “the corporation’s assets” in Subdiv. (2), replaced provision re transfer of property to a corporation all the shares of which are owned by the corporation with provision re transfer of the corporation’s assets to one or more corporations or other entities, all of the shares or interests of which are owned by the corporation in Subdiv. (3), added Subdiv. (4) re pro rata distribution to holders of one or more classes or series or shares, made technical changes and deleted former Subsec. (b) re shareholder approval, effective July 1, 2003.
Sec. 33-831. Sale or other disposition of assets leaving no significant continuing business activity. (a) A sale, lease, exchange or other disposition of assets, other than a disposition described in section 33-830, requires approval of the corporation’s shareholders if any such disposition would leave the corporation without a significant continuing business activity. If a corporation retains a business activity that represented at least twenty-five per cent of total assets at the end of the most recently completed fiscal year, and twenty-five per cent of either income from continuing operations before taxes or revenues from continuing operations for such fiscal year, for the corporation and each of its subsidiaries on a consolidated basis, the corporation will conclusively be deemed to have retained a significant continuing business activity.
(b) A disposition that requires approval of the shareholders under subsection (a) of this section shall be initiated by a resolution of the board of directors authorizing the disposition. After adoption of such a resolution, the board of directors shall submit the proposed disposition to the shareholders for their approval. The board of directors shall also transmit to the shareholders a recommendation that the shareholders approve the proposed disposition, unless (1) the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation, or (2) section 33-754 applies. If subdivision (1) or (2) of this subsection applies, the board of directors must transmit to the shareholders the basis for so proceeding.
(c) The board of directors may condition its submission of a disposition to the shareholders under subsection (b) of this section on any basis.
(d) If a disposition is required to be approved by the shareholders under subsection (a) of this section, and if the approval is to be given at a meeting, the corporation shall notify each shareholder, whether or not entitled to vote, of the meeting of shareholders at which the disposition is to be submitted for approval. The notice shall also state that the purpose, or one of the purposes, of the meeting is to consider the disposition and shall contain a description of the disposition, including the terms and conditions thereof and the consideration to be received by the corporation therefor.
(e) Unless the certificate of incorporation or the board of directors, acting pursuant to subsection (c) of this section, requires a greater vote or a vote by voting groups, and except as provided in subsection (i) of this section, the disposition to be authorized must be approved by a majority of all the votes entitled to be cast on the disposition.
(f) After a disposition has been approved by the shareholders under subsection (b) of this section, and at any time before the disposition has been consummated, the disposition may be abandoned by the corporation without action by the shareholders, subject to any contractual rights of other parties to the disposition.
(g) A disposition of assets in the course of dissolution under sections 33-880 to 33-903, inclusive, is not governed by this section.
(h) The assets of a direct or indirect consolidated subsidiary shall be deemed the assets of the parent corporation for the purposes of this section.
(i) Notwithstanding any provision of subsection (e) of this section to the contrary, a transaction of the type described in subsection (a) of this section of a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revision of 1958, revised to January 1, 1995, or any other general law or special act, prior to January 1, 1997, to be authorized by such corporation shall, unless the certificate of incorporation expressly provides otherwise, be approved by the affirmative vote of at least two-thirds of (1) the voting power of each voting group of such corporation entitled to vote thereon, and (2) the voting power of each class of stock of such corporation outstanding prior to January 1, 1997, whether or not otherwise entitled to vote thereon.
(P.A. 94-186, S. 140, 215; P.A. 96-271, S. 109, 110, 254; P.A. 97-246, S. 86, 99; P.A. 03-18, S. 26; P.A. 10-35, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (h) to replace “January 1, 1996” with “January 1, 1997” and “each class of such corporation” with “each class of stock of such corporation”, effective January 1, 1997; P.A. 97-246 amended Subsec. (d) to make a technical change, effective June 27, 1997; P.A. 03-18 amended Subsec. (a) by replacing former provisions with provisions re shareholder approval of disposition of assets that would leave the corporation without a significant continuing business activity, amended Subsec. (b) by replacing former provisions with provisions re action by the board of directors, amended Subsec. (c) by replacing provision re submission of proposed transaction with provision re submission of disposition to shareholders under Subsec. (b), amended Subsec. (d) by adding provision re shareholder approval of disposition at a meeting, replacing “proposed shareholders’ meeting in accordance with section 33-699” with “meeting of shareholders at which the disposition is to be submitted for approval”, and replacing former provision re shareholder notice of purpose of meeting with provision re notice to shareholders that purpose is to consider disposition, containing description of disposition, terms and conditions and consideration to be received, amended Subsec. (e) by replacing references to “transaction” with references to “disposition” and making a technical change, amended Subsec. (f) by replacing former provisions re abandoned transaction with provisions re abandonment of disposition without shareholder action at any time before disposition has been consummated, subject to contractual rights of other parties to the disposition, amended Subsec. (g) by replacing former provisions with provisions re disposition of assets in the course of dissolution, added new Subsec. (h) re assets of direct or indirect consolidated subsidiary, and redesignated existing Subsec. (h) as Subsec. (i), making technical changes therein, effective July 1, 2003; P.A. 10-35 amended Subsec. (b) to designate existing provisions re board determination that it should not make a recommendation due to conflicts of interest or other special circumstances as Subdiv. (1), add Subdiv. (2) re whether Sec. 33-754 applies, and provide that if Subdiv. (1) or (2) applies, board must transmit to shareholders basis for so proceeding, rather than basis for determination.
Secs. 33-832 to 33-839. Reserved for future use.
PART XII
BUSINESS COMBINATIONS
Sec. 33-840. Business combinations. Definitions. The terms used in sections 33-840 to 33-842, inclusive, shall be defined as follows:
(1) “Affiliate”, including the term “affiliated person”, means a person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, a specified person.
(2) “Associate”, when used to indicate a relationship with any person, means: (A) Any domestic or foreign corporation or organization, other than a corporation or a subsidiary of the corporation, of which such person is an officer, director, or partner or is, directly or indirectly, the beneficial owner of ten per cent or more of any class of equity securities; (B) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; and (C) any relative or spouse of such person, or any relative of such spouse, who has the same home as such person or who is a director or officer of the corporation or any of its affiliates.
(3) “Beneficial owner”, when used with respect to any voting stock, means a person: (A) That, individually or with any of its affiliates or associates, beneficially owns voting stock directly or indirectly; or (B) that, individually or with any of its affiliates or associates, has: (i) The right to acquire voting stock, whether such right is exercisable immediately or only after the passage of time, pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; or (ii) the right to vote or direct the voting stock pursuant to any agreement, arrangement or understanding; or (iii) the right to dispose of or to direct the disposition of voting stock pursuant to any agreement, arrangement or understanding; or (C) that, individually or with any of its affiliates or associates, has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of voting stock with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such shares of voting stock.
(4) “Business combination”, when used with respect to any corporation, means: (A) Any merger, consolidation or share exchange of the corporation or any subsidiary with (i) any interested shareholder or (ii) any other domestic or foreign corporation, whether or not itself an interested shareholder, which is, or after the merger, consolidation or share exchange would be, an affiliate or associate of an interested shareholder that was an interested shareholder prior to the transaction; (B) any sale, lease, exchange, mortgage pledge, transfer or other disposition, other than in the usual and regular course of business, in one transaction or a series of transactions in any twelve-month period, to any interested shareholder or any affiliate or associate of any interested shareholder, other than the corporation or any of its subsidiaries, of any assets of the corporation or any subsidiary having, measured at the time the transaction or transactions are approved by the board of directors of the corporation, an aggregate book value as of the end of the corporation’s most recent fiscal quarter of ten per cent or more of the total market value of the outstanding shares of the corporation or of its net worth as of the end of its most recent fiscal quarter; (C) the issuance or transfer by the corporation, or any subsidiary, in one transaction or a series of transactions, of any equity securities of the corporation or any subsidiary which have an aggregate market value of five per cent or more of the total market value of the outstanding shares of the corporation to any interested shareholder or any affiliate or associate of any interested shareholder, other than the corporation or any of its subsidiaries, except pursuant to the exercise of warrants, rights or options to subscribe to or purchase securities offered, issued or granted pro rata to all holders of the voting stock of the corporation or any other method affording substantially proportionate treatment to the holders of voting stock; (D) the adoption of any resolution for the liquidation or dissolution of the corporation or any subsidiary proposed by or on behalf of an interested shareholder or any affiliate or associate of any interested shareholder, other than the corporation or any of its subsidiaries; or (E) any reclassification of securities, including any reverse stock split, or recapitalization of the corporation, or any merger, consolidation or share exchange of the corporation with any of its subsidiaries which has the effect, directly or indirectly, in one transaction or a series of transactions, of increasing by five per cent or more of the total number of outstanding shares, the proportionate amount of the outstanding shares of any class of equity securities of the corporation or any subsidiary which is directly or indirectly owned by any interested shareholder or any affiliate or associate of any interested shareholder, other than the corporation or any of its subsidiaries.
(5) “Common stock” means any shares other than preferred shares.
(6) “Control”, including the terms “controlling”, “controlled by” and “under common control with”, means the possession, directly or indirectly, of the power to direct or cause the direction of the board of directors, the management or the policies of a person, whether through the ownership of voting securities, by contract, or otherwise, and the beneficial ownership of ten per cent or more of the voting power of the voting stock of a corporation creates a presumption of control.
(7) “Corporation” or “domestic corporation” means any corporation with capital stock formed under the laws of this state before or after January 1, 1961, including a real estate investment trust.
(8) “Equity security” means: (A) Any share or similar security, certificate of interest, or participation in any profit-sharing agreement, voting trust certificate or certificate of deposit for a share of the corporation; (B) any security convertible, with or without consideration, into any share of the corporation, or any warrant, right or option to subscribe to or purchase any share of the corporation; or (C) any put, call, straddle or other option or privilege of buying any share of the corporation from or selling any share of the corporation to another without being bound to do so.
(9) “Interested shareholder” means any person, other than the corporation or any of its subsidiaries, that is the beneficial owner, directly or indirectly, of ten per cent or more of the voting power of the outstanding shares of voting stock of the corporation, or is an affiliate of the corporation and at any time within the two-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten per cent or more of the voting power of the then outstanding shares of voting stock of the corporation. For the purpose of determining whether a person is an interested shareholder, the number of shares of voting stock deemed to be outstanding shall include shares deemed owned by the person through application of subdivision (3) of this section but shall not include any other shares of voting stock which may be issuable to persons other than the person in question pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, exchange rights, warrants or options, or otherwise.
(10) “Market value” as of any date means: (A) In the case of shares of stock of a corporation, the highest closing sale price during the thirty-day period immediately preceding the date in question of a share of such stock on the composite tape for New-York-Stock-Exchange-listed stocks, or, if such stock is not quoted on the composite tape, on the New York Stock Exchange, or if such stock is not listed on such exchange, on the principal United States securities exchange registered under the Securities Exchange Act of 1934 on which such stock is listed, or, if such stock is not listed on any such exchange, the highest closing bid quotation with respect to a share of such stock during the thirty-day period immediately preceding the date in question on the National Association of Securities Dealers, Inc. automated quotations system or any system then in use, or, if no such quotations are available, the fair market value on the date in question of a share of such stock as determined by the board of directors of the corporation in good faith; and (B) in the case of property other than cash or stock, the fair market value of such property on the date in question as determined by the board of directors of the corporation in good faith.
(11) “Person” means a natural person, company, partnership, foreign or domestic corporation, limited liability company, trust, unincorporated organization, government or any other entity or political subdivision, agency or instrumentality of a government. The term also includes two or more of the foregoing acting as a partnership, limited partnership, syndicate or other group for the purpose of acquiring, holding, voting or disposing of securities of an issuer.
(12) “Share exchange” means an exchange offer or any other exchange of securities of a person for the voting stock of a corporation.
(13) “Subsidiary” means any corporation of which voting stock having a majority of the votes entitled to be cast is owned, directly or indirectly, by the corporation.
(14) “Voting stock” means shares of capital stock of a corporation entitled to vote generally in the election of directors.
(P.A. 94-186, S. 141, 215; P.A. 95-79, S. 126, 189.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-79 redefined “person” to include a limited liability company, effective January 1, 1997.
Sec. 33-841. Approval of business combination. In addition to any vote otherwise required by law or the certificate of incorporation of a corporation, a business combination shall first be approved by the board of directors and then be approved by the affirmative vote of at least: (1) The holders of eighty per cent of the voting power of the outstanding shares of the voting stock of the corporation; and (2) the holders of two-thirds of the voting power of the outstanding shares of voting stock of the corporation other than voting stock held by the interested shareholder who is, or whose affiliate or associate is, a party to the business combination or held by an affiliate or associate of the interested shareholder.
(P.A. 94-186, S. 142, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-842. Exceptions. (a) For purposes of subsection (b) of this section:
(1) “Announcement date” means the first general public announcement of the proposal or intention to make a proposal of the business combination or its first communication generally to shareholders of the corporation, whichever is earlier;
(2) “Determination date” means the date on which an interested shareholder first became an interested shareholder;
(3) “Valuation date” means: (A) For a business combination voted upon by shareholders, the later of the day prior to the date of the shareholders vote or the date twenty days prior to the consummation of the business combination; and (B) for a business combination not voted upon by shareholders, the date of the consummation of the business combination.
(b) The vote required by section 33-841 does not apply to a business combination as defined in subparagraph (A) of subdivision (4) of section 33-840 if each of the following conditions is met:
(1) The aggregate amount of the cash and the market value as of the valuation date of consideration other than cash to be received per share by holders of common stock of each class or series in such business combination is at least equal to the highest of the following: (A) The highest per share price, including any brokerage commissions, transfer taxes and soliciting dealers’ fees, paid by the interested shareholder for any shares of common stock of the same class or series acquired by it: (i) Within the two-year period immediately prior to the announcement date of the business combination; or (ii) in the transaction in which it became an interested shareholder, whichever is higher; or (B) the market value per share of common stock of the same class or series on the announcement date or on the determination date, whichever is higher; or (C) the price per share equal to the market value per share of common stock of the same class or series determined pursuant to subdivision (1)(B) of this subsection, multiplied by the fraction of: (i) The highest per share price, including any brokerage commission, transfer taxes and soliciting dealers’ fees, paid by the interested shareholder for any shares of common stock of the same class or series acquired by it within the two-year period immediately prior to the announcement date, over (ii) the market value per share of common stock of the same class or series on the first day in such two-year period on which the interested shareholder acquired any shares of common stock.
(2) The aggregate amount of the cash and the market value as of the valuation date of consideration other than cash to be received per share by holders of shares of any class or series of outstanding stock other than common stock is at least equal to the highest of the following: (A) The highest per share price, including any brokerage commissions, transfer taxes and soliciting dealers’ fees, paid by the interested shareholder for any shares of such class or series of stock acquired by it: (i) Within the two-year period immediately prior to the announcement date of the business combination; or (ii) in the transaction in which it became an interested shareholder, whichever is higher; or (B) the highest preferential amount per share to which the holders of shares of such class or series of stock are entitled in the event of any voluntary or involuntary liquidation, dissolution or winding up of the corporation; or (C) the market value per share of such class or series of stock on the announcement date or on the determination date, whichever is higher; or (D) the price per share equal to the market value per share of such class or series of stock determined pursuant to subdivision (2)(C) of this subsection, multiplied by the fraction of: (i) The highest per share price, including any brokerage commissions, transfer taxes and soliciting dealers’ fees, paid by the interested shareholder for any shares of any class or series of voting stock acquired by it within the two-year period immediately prior to the announcement date, over (ii) the market value per share of the same class or series of voting stock on the first day in such two-year period on which the interested shareholder acquired any shares of the same class or series of voting stock.
(3) The consideration to be received by holders of any class or series of outstanding stock is to be in cash or in the same form as the interested shareholder has previously paid for shares of the same class or series of stock. If the interested shareholder has paid for shares of any class or series of stock with varying forms of consideration, the form of consideration for such class or series of stock shall be either cash or the form used to acquire the largest number of shares of such class or series of stock previously acquired by it.
(4) (A) After the interested shareholder has become an interested shareholder and prior to the consummation of such business combination: (i) There shall have been no failure to declare and pay at the regular date therefor any full periodic dividends, whether or not cumulative, on any outstanding preferred stock of the corporation; (ii) there shall have been no reduction in the annual rate of dividends paid on any class or series of stock of the corporation that is not preferred stock, except as necessary to reflect any subdivision of the stock; and an increase in such annual rate of dividends as necessary to reflect any reclassification, including any reverse stock split, recapitalization, reorganization or any similar transaction which has the effect of reducing the number of outstanding shares of the stock; and (iii) the interested shareholder shall not have become the beneficial owner of any additional shares of stock of the corporation except as part of the transaction which resulted in such interested shareholder becoming an interested shareholder or by virtue of proportionate stock splits or stock dividends. (B) The provisions of subdivisions (4)(A)(i) and (4)(A)(ii) of this subsection do not apply if no interested shareholder or an affiliate or associate of the interested shareholder voted as a director of the corporation in a manner inconsistent with subdivisions (4)(A)(i) and (4)(A)(ii) and the interested shareholder, within ten days after any act or failure to act inconsistent with subdivisions (4)(A)(i) and (4)(A)(ii), notifies the board of directors of the corporation in writing that the interested shareholder disapproves thereof and requests in good faith that the board of directors rectify such act or failure to act.
(5) After the interested shareholder has become an interested shareholder, the interested shareholder shall not have received the benefit, directly or indirectly, except proportionately as a shareholder, of any loans, advances, guarantee, pledges or other financial assistance or any tax credits or other tax advantages provided by the corporation or any of its subsidiaries, whether in anticipation of or in connection with such business combination or otherwise.
(c) (1) Unless the certificate of incorporation provides otherwise, whether or not such business combinations are authorized or consummated in whole or in part after June 4, 1984, or after the interested shareholder became an interested shareholder, the requirements of section 33-841 do not apply to business combinations that specifically, generally, or generally by types, as to specifically identified or unidentified existing or future interested shareholders or their affiliates or associates, have been approved or exempted therefrom by resolution of the board of directors of the corporation: (A) Within two months after June 4, 1984, or such earlier date as may be irrevocably established by resolution of the board of directors; or (B) if involving transactions with a particular interested shareholder or its existing or future affiliates or associates, at any time prior to the time that the interested shareholder first became an interested shareholder; (2) unless by its terms a resolution adopted under this subsection is made irrevocable, it may be altered or repealed by the board of directors, but this shall not affect any business combinations that have been consummated, or are the subject of any existing agreement entered into, prior to the alteration or repeal.
(d) Unless the certificate of incorporation provides otherwise, the requirements of section 33-841 do not apply to any business combination of: (1) A corporation which is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended; (2) a corporation whose original certificate of incorporation has a provision or whose shareholders adopt a certificate of incorporation amendment after June 4, 1984, by a vote of the holders of at least eighty per cent of the voting power of the outstanding shares of the voting stock of the corporation and the holders of at least two-thirds of the voting power of the outstanding shares of voting stock of the corporation other than voting stock held by interested shareholders of the corporation, or affiliates or associates of interested shareholders, expressly electing not to be governed by sections 33-840 to 33-842, inclusive; or (3) an investment company registered under the Investment Company Act of 1940.
(e) A business combination involving a corporation that has a certificate of incorporation provision which provides that a business combination may be approved by an affirmative vote of a lesser proportion of the voting power of the outstanding shares of voting stock of the corporation than the proportion required by section 33-841 is subject to the voting requirements of said section unless one of the requirements or exemptions of subsection (b), (c) or (d) of this section have been met.
(P.A. 94-186, S. 143, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-843. Business combinations. Definitions. For the purposes of sections 33-843 to 33-845, inclusive:
(1) “Affiliate” means a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, a specified person.
(2) “Announcement date”, when used in reference to any business combination, means the date of the first public announcement of the final, definitive proposal for such business combination.
(3) “Associate”, when used to indicate a relationship with any person, means (A) any corporation or organization of which such person is an officer or partner or is, directly or indirectly, the beneficial owner of ten per cent or more of any class of voting stock, (B) any trust or other estate in which such person has at least a ten per cent beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity, and (C) any relative or spouse of such person, or any relative of such spouse, who has the same home as such person.
(4) “Beneficial owner”, when used with respect to any voting stock, means a person:
(A) That, individually or with or through any of its affiliates or associates, beneficially owns such stock, directly or indirectly;
(B) That, individually or with or through any of its affiliates or associates, has (i) the right to acquire such stock, whether such right is exercisable immediately or only after the passage of time or upon the occurrence of a specified event, pursuant to any agreement, arrangement or understanding whether or not in writing, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; provided, a person shall not be deemed the beneficial owner of stock tendered pursuant to a tender or exchange offer made by such person or any of such person’s affiliates or associates until such tendered stock is accepted for purchase or exchange; (ii) the right to vote such stock pursuant to any agreement, arrangement or understanding whether or not in writing; provided, a person shall not be deemed the beneficial owner of any stock under this subparagraph if the agreement, arrangement or understanding to vote such stock arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act and is not then reportable on Schedule 13D under the Exchange Act or any comparable or successor report; or (iii) the right to dispose of such stock pursuant to any agreement, arrangement or understanding whether or not in writing; or
(C) That, individually or with or through any of its affiliates or associates, has any agreement, arrangement or understanding whether or not in writing for the purpose of acquiring, except pursuant to a tender or exchange offer until such tendered stock is accepted for purchase or exchange as described in subparagraph (B)(i) of this subdivision, holding, voting, except voting pursuant to a revocable proxy or consent as described in subparagraph (B)(ii) of this subdivision, or disposing of such stock with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such stock.
(5) “Business combination”, when used in reference to any resident domestic corporation and any interested shareholder of such resident domestic corporation, means:
(A) Any merger or consolidation of such resident domestic corporation or any subsidiary of such resident domestic corporation with or into (i) such interested shareholder or (ii) any other corporation whether or not itself an interested shareholder of such resident domestic corporation which is, or after such merger or consolidation would be, an affiliate or associate of such interested shareholder;
(B) Any sale, lease, exchange, mortgage, pledge, transfer or other disposition in one transaction or a series of transactions to or with such interested shareholder or any affiliate or associate of such interested shareholder of assets of such resident domestic corporation or any subsidiary of such resident domestic corporation (i) having an aggregate market value equal to ten per cent or more of the aggregate market value of all the assets, determined on a consolidated basis, of such resident domestic corporation, (ii) having an aggregate market value equal to ten per cent or more of the aggregate market value of all the outstanding stock of such resident domestic corporation, or (iii) representing ten per cent or more of the earning power or net income, determined on a consolidated basis, of such resident domestic corporation, except pursuant to a dividend or distribution paid or made pro rata to all holders of common stock of such resident domestic corporation and to all holders of any other class of stock of such resident domestic corporation entitled to participate with the holders of common stock in the receipt of such dividend or distribution;
(C) The issuance or transfer by such resident domestic corporation or any subsidiary of such resident domestic corporation in one transaction or a series of transactions of any stock of such resident domestic corporation or any subsidiary of such resident domestic corporation which has an aggregate market value equal to five per cent or more of the aggregate market value of all the outstanding stock of such resident domestic corporation to such interested shareholder or any affiliate or associate of such interested shareholder, except (i) pursuant to a dividend or distribution paid or made pro rata to all holders of common stock of such resident domestic corporation and to all holders of any other class of stock of such resident domestic corporation entitled to participate with the holders of common stock in the receipt of such dividend or distribution, or (ii) pursuant to the exercise of warrants or rights to purchase stock or pursuant to the conversion of convertible securities;
(D) The adoption of any plan or proposal for the complete or partial liquidation or dissolution of such resident domestic corporation or any subsidiary of such resident domestic corporation, or declarations or payments of dividends and distributions to the holders of stock of such resident domestic corporation in any twelve-month period having an aggregate market value of more than five per cent of the aggregate market value of all assets, determined on a consolidated basis, of such resident domestic corporation as of the beginning of such twelve-month period, which plan or proposal is, or declarations or payments are, proposed by, or pursuant to any agreement, arrangement or understanding whether or not in writing with, such interested shareholder or any affiliate or associate of such interested shareholder, at any time following such interested shareholder’s stock acquisition date;
(E) Any reclassification of securities including, without limitation, any stock split, stock dividend, or other distribution of stock in respect of stock, or any reverse stock split, or recapitalization of such resident domestic corporation, or any merger or consolidation of such resident domestic corporation with any subsidiary of such resident domestic corporation, or any other transaction whether or not with or into or otherwise involving such interested shareholder, which reclassification, merger, consolidation or other transaction (i) has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class or series of voting stock or securities convertible into voting stock of such resident domestic corporation or any subsidiary of such resident domestic corporation which is directly or indirectly owned by such interested shareholder or any affiliate or associate of such interested shareholder, except as a result of immaterial changes due to fractional share adjustments, and (ii) is proposed by, or pursuant to any agreement, arrangement or understanding whether or not in writing with, such interested shareholder or any affiliate or associate of such interested shareholder at any time following such interested shareholder’s stock acquisition date; or
(F) Any receipt by such interested shareholder or any affiliate or associate of such interested shareholder of the benefit, directly or indirectly, except proportionately as a shareholder of such resident domestic corporation, of any loans, advances, guarantees, pledges or other financial assistance or any tax credits or other tax advantages provided by or through such resident domestic corporation or any subsidiary of such resident domestic corporation; provided, for purposes of subparagraphs (A), (B) and (C) of this subdivision, a corporation, hereinafter referred to as the “other corporation”, which has entered into a definitive agreement or an agreement in principle or has an arrangement or understanding, whether formal or informal, in writing or not, with such resident domestic corporation or any subsidiary of such resident domestic corporation providing for any of the transactions contemplated by subparagraphs (A), (B) and (C) of this subdivision between such resident domestic corporation or any subsidiary of such resident domestic corporation and the other corporation or any subsidiary of the other corporation shall not be deemed to be an associate of such interested shareholder solely by reason of the fact that, after the date of such definitive agreement or agreement in principle or arrangement or understanding or the date of the first public announcement or disclosure of such transaction, whichever is earlier, such interested shareholder becomes, or after such transaction would become, directly or indirectly, the beneficial owner of ten per cent or more of any class of voting stock of the other corporation.
(6) “Control”, including the terms “controlling”, “controlled by” and “under common control with”, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting stock, by contract or otherwise. A person’s beneficial ownership of ten per cent or more of the voting power of a corporation’s outstanding voting stock shall create a presumption that such person has control of such corporation. Notwithstanding the foregoing, a presumption of control shall not apply where such person holds voting stock, in good faith and not for the purpose of circumventing sections 33-843 to 33-845, inclusive, as an agent, bank, broker, nominee, custodian or trustee for one or more beneficial owners who do not individually or as a group have control of such corporation.
(7) “Corporation” means any corporation, whether domestic or foreign.
(8) “Exchange Act” means the Act of Congress known as the Securities Exchange Act of 1934, as the same has been or hereafter may be amended from time to time.
(9) “Interested shareholder”, when used in reference to any resident domestic corporation, means any person, other than such resident domestic corporation or any subsidiary of such resident domestic corporation, that: (A) Is the beneficial owner, directly or indirectly, of ten per cent or more of the voting power of the outstanding voting stock of such resident domestic corporation; or (B) is an affiliate or associate of such resident domestic corporation and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten per cent or more of the voting power of the then outstanding voting stock of such resident domestic corporation; provided for the purpose of determining whether a person is an interested shareholder, the number of shares of voting stock of such resident domestic corporation deemed to be outstanding shall include shares deemed to be beneficially owned by the person but shall not include any other unissued shares of voting stock of such resident domestic corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise.
(10) “Person” means a natural person, company, partnership, foreign or domestic corporation, limited liability company, trust, unincorporated organization, government or any other entity or political subdivision, agency or instrumentality of a government. The term also includes two or more of the foregoing acting as a partnership, limited partnership, syndicate, joint venture or other formal or informal group for the purpose of acquiring, holding, voting or disposing of securities of an issuer.
(11) “Resident domestic corporation” means an issuer of voting stock which: (A) Is organized under the laws of this state; and (B) has its principal executive offices or significant business operations located in this state or has a significant financial relationship with one or more businesses located in this state; provided no resident domestic corporation shall cease to be a resident domestic corporation by reason of events occurring or actions taken while such resident domestic corporation is subject to the provisions of sections 33-843 to 33-845, inclusive.
(12) “Stock” means: (A) Any stock or similar security, any certificate of interest, any participation in any profit-sharing agreement, any voting trust certificate or any certificate of deposit for stock; and (B) any security convertible, with or without consideration, into stock, or any warrant, call or other option or privilege of buying stock without being bound to do so, or any other security carrying any right to acquire, subscribe to or purchase stock.
(13) “Stock acquisition date”, with respect to any person and any resident domestic corporation, means the date that such person first becomes an interested shareholder of such resident domestic corporation.
(14) “Subsidiary” of any resident domestic corporation means any other corporation of which voting stock, having a majority of the voting power of the outstanding voting stock of such other corporation, is owned, directly or indirectly, by such resident domestic corporation.
(15) “Voting stock” means shares of capital stock of a corporation entitled to vote generally in the election of directors.
(P.A. 94-186, S. 144, 215; P.A. 95-79, S. 127, 189.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-79 redefined “person” to include a limited liability company, effective January 1, 1997.
Sec. 33-844. Business combination with interested shareholder prohibited for five years unless approved by board of directors. (a) Except as provided in section 33-845, notwithstanding anything to the contrary in sections 33-840 to 33-845, inclusive, no resident domestic corporation shall engage in any business combination with any interested shareholder of such resident domestic corporation for a period of five years following such interested shareholder’s stock acquisition date unless such business combination or the purchase of stock made by such interested shareholder on such interested shareholder’s stock acquisition date is approved by the board of directors of such resident domestic corporation and by a majority of the nonemployee directors of which there shall be at least two, prior to such interested shareholder’s stock acquisition date.
(b) If a good faith proposal is made in writing to the board of directors of a resident domestic corporation regarding a business combination, the board of directors shall respond, in writing, within forty-five days or such shorter period, if any, as may be required by the Exchange Act, setting forth its reasons for its decision regarding such proposal. If a good faith proposal to purchase stock is made in writing to the board of directors of a resident domestic corporation, the board of directors, unless it responds affirmatively in writing within forty-five days or such shorter period, if any, as may be required by the Exchange Act, shall be deemed to have disapproved such stock purchase.
(c) The provisions of this section shall be in addition to any other provisions of the general statutes which apply to such business combination.
(P.A. 94-186, S. 145, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-845. Excepted business combinations. The provisions of section 33-844 shall not apply:
(1) To any business combination between an interested shareholder or any affiliate or associate of such interested shareholder and a resident domestic corporation which does not have a class of voting stock registered pursuant to Section 12 of the Exchange Act on such interested shareholder’s stock acquisition date, unless (A) the certificate of incorporation of such resident domestic corporation provides at the time of such business combination that the provisions of section 33-844 shall apply, or (B) the failure of such resident domestic corporation to have a class of voting stock registered pursuant to Section 12 of the Exchange Act results from the transaction in which such interested shareholder became an interested shareholder;
(2) To any business combination of a resident domestic corporation with an interested shareholder of such resident domestic corporation which became an interested shareholder inadvertently, if such interested shareholder (A) as soon as practicable, divests itself of a sufficient amount of the voting stock of such resident domestic corporation so that it no longer is the beneficial owner, directly or indirectly, of ten per cent or more of the outstanding voting stock of such resident domestic corporation, and (B) would not at any time within the five-year period preceding the announcement date with respect to such business combination have been an interested shareholder but for such inadvertent acquisition;
(3) To any business combination of a resident domestic corporation with an interested shareholder which was an interested shareholder on February 1, 1988, unless subsequent to June 7, 1988, such interested shareholder increases its proportionate share of the voting power of the outstanding voting stock of such resident domestic corporation, excluding any increase approved by the board of directors of the resident domestic corporation before such increase occurs; or
(4) To any business combination of a resident domestic corporation which (A) on and after January 1, 1991, is a signatory to, and agrees to the standards contained in, the Connecticut Partnership Compact adopted pursuant to section 33-374g of the general statutes, revision of 1958, revised to 1991, and (B) adopts an amendment to such resident domestic corporation’s certificate of incorporation or bylaws which, in addition to any other approval required by law or by the certificate of incorporation or bylaws as applicable, is approved by the affirmative vote of the holders, other than interested shareholders and their affiliates and associates, of two-thirds of the voting power of the outstanding voting stock of such resident domestic corporation, excluding the voting stock of interested shareholders and their affiliates and associates, expressly electing not to be governed by the provisions of section 33-844, provided such amendment to the certificate of incorporation or bylaws shall not be effective until eighteen months after such vote of such resident domestic corporation’s shareholders and shall not apply to any business combination of such resident domestic corporation with an interested shareholder whose stock acquisition date is on or prior to the effective date of such amendment.
(P.A. 94-186, S. 146, 215.)
History: P.A. 94-186 effective January 1, 1997.
Secs. 33-846 to 33-854. Reserved for future use.
PART XIII
APPRAISAL RIGHTS
(A)
RIGHT TO APPRAISAL AND PAYMENT FOR SHARES
Sec. 33-855. Definitions. As used in this section and sections 33-856 to 33-872, inclusive:
(1) “Affiliate” means a person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with another person or is a senior executive thereof. For purposes of subdivision (4) of subsection (b) of section 33-856, a person is deemed to be an affiliate of its senior executives.
(2) “Corporation” means the issuer of the shares held by a shareholder demanding appraisal and, for purposes of sections 33-862 to 33-872, inclusive, includes the surviving entity in a merger.
(3) “Fair value” means the value of the corporation’s shares determined: (A) Immediately before the effectuation of the corporate action to which the shareholder objects, (B) using customary and current valuation concepts and techniques generally employed for similar businesses in the context of the transaction requiring appraisal, and (C) without discounting for lack of marketability or minority status except, if appropriate, for amendments to the certificate of incorporation pursuant to subdivision (5) of subsection (a) of section 33-856.
(4) “Interest” means interest from the effective date of the corporate action until the date of payment, at the rate of interest on judgments in this state on the effective date of the corporate action.
(5) “Interested transaction” means a corporate action specified in subsection (a) of section 33-856, other than a merger pursuant to section 33-818, involving an interested person in which any of the shares or assets of the corporation are being acquired or converted. As used in this definition: (A) “Interested person” means a person, or an affiliate of a person, who at any time during the one-year period immediately preceding approval by the board of directors of the corporate action: (i) Was the beneficial owner of twenty per cent or more of the voting power of the corporation, excluding any shares acquired pursuant to an offer for all shares having voting power if the offer was made within one year prior to the corporate action for consideration of the same kind and of a value equal to or less than that paid in connection with the corporate action; (ii) had the power, contractually or otherwise, to cause the appointment or election of twenty-five per cent or more of the directors to the board of directors of the corporation; or (iii) was a senior executive or director of the corporation or a senior executive of any affiliate thereof, and that senior executive or director will receive, as a result of the corporate action, a financial benefit not generally available to other shareholders as such, other than: (I) Employment, consulting, retirement or similar benefits established separately and not as part of or in contemplation of the corporate action; or (II) employment, consulting, retirement or similar benefits established in contemplation of, or as part of, the corporate action that are not more favorable than those existing before the corporate action or, if more favorable, that have been approved on behalf of the corporation in the same manner as is provided in section 33-783; or (III) in the case of a director of the corporation who will, in the corporate action, become a director of the acquiring entity in the corporate action or one of its affiliates, rights and benefits as a director that are provided on the same basis as those afforded by the acquiring entity generally to other directors of such entity or such affiliate; and (B) “beneficial owner” means any person who, directly or indirectly, through any contract, arrangement or understanding, other than a revocable proxy, has or shares the power to vote, or to direct the voting of, shares; except that a member of a national securities exchange is not deemed to be a beneficial owner of securities held directly or indirectly by it on behalf of another person solely because the member is the record holder of the securities if the member is precluded by the rules of the exchange from voting without instruction on contested matters or matters that may affect substantially the rights or privileges of the holders of the securities to be voted. When two or more persons agree to act together for the purpose of voting their shares of the corporation, each member of the group formed thereby is deemed to have acquired beneficial ownership, as of the date of the agreement, of all voting shares of the corporation beneficially owned by any member of the group.
(6) “Preferred shares” means a class or series of shares whose holders have preference over any other class or series with respect to distributions.
(7) “Record shareholder” means the person in whose name shares are registered in the records of the corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with the corporation.
(8) “Senior executive” means the chief executive officer, chief operating officer, chief financial officer and any individual in charge of a principal business unit or function.
(9) “Shareholder” means both a record shareholder and a beneficial shareholder.
(P.A. 94-186, S. 147, 215; P.A. 01-199, S. 15; P.A. 09-55, S. 1; P.A. 17-108, S. 23.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 added definitions of “affiliate”, “preferred shares” and “senior executive”, deleted definition of “dissenter”, redefined “beneficial shareholder”, “corporation”, “fair value”, “interest”, “record shareholder” and “shareholder” and alphabetized and renumbered definitions (Revisor’s note: The word “inclusive” was added editorially by the Revisors in Subdiv. (3) following the phrase “sections 33-862 to 33-872,” for consistency with customary statutory usage); P.A. 09-55 added new Subdiv. (6) defining “interested transaction” and redesignated existing Subdivs. (6) to (9) as Subdivs. (7) to (10); P.A. 17-108 deleted former Subdiv. (2) defining “beneficial shareholder” and redesignated existing Subdivs. (3) to (10) as Subdivs. (2) to (9), and made technical changes.
Cited. 44 CS 12.
Sec. 33-856. Right to appraisal. (a) A shareholder is entitled to appraisal rights, and to obtain payment of the fair value of that shareholder’s shares, in the event of any of the following corporate actions:
(1) Consummation of a merger to which the corporation is a party (A) if shareholder approval is required for the merger by section 33-817, or would be required but for the provisions of subdivision (10) of section 33-817, except that appraisal rights shall not be available to any shareholder of the corporation with respect to shares of any class or series that remain outstanding after consummation of the merger, or (B) if the corporation is a subsidiary and the merger is governed by section 33-818;
(2) Consummation of a share exchange to which the corporation is a party the shares of which will be acquired, except that appraisal rights shall not be available to any shareholder of the corporation with respect to any class or series of shares of the corporation that is not acquired in the share exchange;
(3) Consummation of a disposition of assets pursuant to section 33-831 if the shareholder is entitled to vote on the disposition, except that appraisal rights shall not be available to any shareholder of the corporation with respect to shares of any class or series if (A) under the terms of the corporate action approved by the shareholders there is to be distributed to shareholders in cash the corporation’s net assets, in excess of a reasonable amount reserved to meet claims of the type described in sections 33-886 and 33-887, (i) within one year after the shareholders’ approval of the action, and (ii) in accordance with their respective interests determined at the time of such distribution, and (B) the disposition of assets is not an interested transaction;
(4) An amendment of the certificate of incorporation with respect to a class or series of shares that reduces the number of shares of a class or series owned by the shareholder to a fraction of a share if the corporation has the obligation or right to repurchase the fractional share so created;
(5) If the corporation is not a benefit corporation, as defined in section 33-1351, (A) an amendment of the certificate of incorporation to state that the corporation is a benefit corporation; (B) consummation of a merger to which the corporation is a party in which the surviving corporation will be a benefit corporation or in which shares in the corporation will be converted into a right to receive shares of a benefit corporation; or (C) consummation of a share exchange to which the corporation is a party and the shares of the corporation will be exchanged for shares of a benefit corporation;
(6) Consummation of a division, as defined in section 38a-156r, to which the corporation is a party, provided any such appraisal is subject to the limitations of section 38a-156y; or
(7) Any other merger, share exchange, disposition of assets or amendment to the certificate of incorporation; in each case to the extent provided by the certificate of incorporation, the bylaws or a resolution of the board of directors.
(b) Notwithstanding subsection (a) of this section, the availability of appraisal rights under subdivisions (1) to (5), inclusive, of subsection (a) of this section shall be limited in accordance with the following provisions:
(1) Appraisal rights shall not be available for the holders of shares of any class or series of shares which is:
(A) A covered security under Section 18(b)(1)(A) or (B) of the Securities Act of 1933, as amended;
(B) Traded in an organized market and has at least two thousand shareholders and a market value of at least twenty million dollars, exclusive of the value of such shares held by the corporation’s subsidiaries, senior executives and directors and by any beneficial shareholders and any voting trust beneficial owner owning more than ten per cent of such shares; or
(C) Issued by an open-end management investment company registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and which may be redeemed at the option of the holder at net asset value.
(2) The applicability of subdivision (1) of this subsection shall be determined as of: (A) The record date fixed to determine the shareholders entitled to receive notice of the meeting of shareholders to act upon the corporate action requiring appraisal rights or, in the case of an offer made pursuant to subdivision (10) of section 33-817, the date of such offer; or (B) if there is no meeting of shareholders and no offer made pursuant to subdivision (10) of section 33-817, the day before the consummation of the corporate action or effective date of the amendment of the certificate of incorporation, as applicable.
(3) Subdivision (1) of this subsection shall not be applicable and appraisal rights shall be available pursuant to subsection (a) of this section for the holders of any class or series of shares (A) who are required by the terms of the corporate action requiring appraisal rights to accept for such shares anything other than cash or shares of any class or any series of shares of any corporation, or any other proprietary interest of any other entity, that satisfies the standards set forth in subdivision (1) of this subsection at the time the corporate action becomes effective, or (B) in the case of the consummation of a disposition of assets pursuant to section 33-831, unless the cash, shares or proprietary interests received in the disposition are, under the terms of the corporate action approved by the shareholders, to be distributed to the shareholders, as part of a distribution to shareholders of the net assets of the corporation in excess of a reasonable amount to meet claims of the type described in sections 33-886 and 33-887, (i) not later than one year after the shareholders’ approval of the action, and (ii) in accordance with their respective interests determined at the time of the distribution.
(4) Subdivision (1) of this subsection shall not be applicable and appraisal rights shall be available pursuant to subsection (a) of this section for the holders of any class or series of shares where the corporate action is an interested transaction.
(c) Notwithstanding any other provision of this section, the certificate of incorporation as originally filed or any amendment to the certificate of incorporation may limit or eliminate appraisal rights for any class or series of preferred shares, except that (1) no such limitation or elimination shall be effective if the class or series does not have the right to vote separately as a voting group, alone or as part of a group, on the action, and (2) any such limitation or elimination contained in an amendment to the certificate of incorporation that limits or eliminates appraisal rights for any of such shares that are outstanding immediately before the effective date of such amendment or that the corporation is or may be required to issue or sell thereafter pursuant to any conversion, exchange or other right existing immediately before the effective date of such amendment shall not apply to any corporate action that becomes effective within one year of the effective date of such amendment if such action would otherwise afford appraisal rights.
(d) Where the right to be paid the value of shares is made available to a shareholder by this section, such remedy shall be the exclusive remedy as holder of such shares against the corporate actions described in this section, whether or not the shareholder proceeds as provided in sections 33-855 to 33-872, inclusive.
(P.A. 94-186, S. 148, 215; P.A. 96-271, S. 111, 254; P.A. 01-199, S. 16; P.A. 09-55, S. 3; P.A. 11-147, S. 8; P.A. 12-32, S. 13; P.A. 14-217, S. 155; P.A. 17-2, S. 11; 17-108, S. 16.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing, effective January 1, 1997; P.A. 01-199 substantially revised section including amending Subsec. (a) to provide that a shareholder is entitled to “appraisal rights” in the event of certain corporate action rather than to “dissent from” such action, revising Subdivs. (1) to (5), inclusive, of Subsec. (a) re transactions which afford appraisal rights, adding new Subsec. (b) re market exception to the availability of appraisal rights and the availability of appraisal rights in conflict transactions, adding new Subsec. (c) re limitation or elimination of appraisal rights for preferred shares, redesignating former Subsec. (b) as Subsec. (d) and making technical changes throughout section for purposes of gender neutrality; P.A. 09-55 amended Subsec. (b) to replace former provisions of Subdiv. (1)(A) re listed shares with provision re shares that are a covered security, replace in Subdiv. (1)(B) “not so listed or designated but has at least two thousand shareholders and the outstanding shares of such class or series has a market value of at least twenty million dollars” with “Traded in an organized market and has at least two thousand shareholders and a market value of at least twenty million dollars”, add new Subdiv. (1)(C) re shares issued by an open-end management investment company, and replace former Subdivs. (4) and (5) with new Subdiv. (4) re availability of appraisal rights where corporate action is an interested transaction, and amended Subsec. (d) to replace “corporate transactions” with “corporate actions”; P.A. 11-147 amended Subsec. (b)(2)(A) to delete provision re record date determined shareholders entitled “to vote at” meeting; P.A. 12-32 amended Subsec. (a)(3) by adding exception re when appraisal rights shall not be available and amended Subsec. (b)(3) by designating existing provisions re appraisal rights for certain holders as Subpara. (A) and adding Subpara. (B) re availability of appraisal rights in the case of consummation of a disposition of assets; P.A. 14-217 amended Subsec. (a) to add new Subdiv. (5) re availability of appraisal rights in certain corporate actions involving a benefit corporation and redesignate existing Subdiv. (5) as Subdiv. (6), and made a conforming change in Subsec. (b); P.A. 17-2 amended Subsec. (a) to add new Subdiv. (6) re appraisal subject to limitations, redesignate existing Subdiv. (6) as Subdiv. (7) and made a conforming change; P.A. 17-108 amended Subsec. (a)(1)(A) by replacing “and the shareholder is entitled to vote on the merger” with “or would be required but for the provisions of subdivision (10) of section 33-817”, amended Subsec. (a)(2) by replacing “as the corporation whose shares will be acquired, if the shareholder is entitled to vote on the exchange” with “the shares of which will be acquired” and by replacing “that is not exchanged” with “that is not acquired in the share exchange”, amended Subsec.(a)(5)(B) by replacing “entity” with “corporation”, amended Subsec. (b)(1)(B) by adding “and any voting trust beneficial owner”, amended Subsec. (b)(2)(A) by adding “or, in the case of an offer made pursuant to subdivision (10) of section 33-817, the date of such offer”, amended Subsec. (b)(2)(B) by replacing provision re day before effective date of corporate action with provision re day before consummation of corporate action or effective date of amendment of certificate of incorporation, amended Subsec. (b)(3)(B) by replacing “proprietary interests” with “proprietary interests received in the disposition”, amended Subsec. (c) by adding Subdiv. (1) re no limitation or elimination effective if class or series does not have right to vote separately as voting group, alone or as part of group on action designating existing provisions re limitation or elimination contained in amendment to certificate of incorporation as Subdiv. (2), and made technical changes.
Sec. 33-857. Assertion of rights by nominees and beneficial owners. (a) A record shareholder may assert appraisal rights as to fewer than all the shares registered in the record shareholder’s name but owned by a beneficial shareholder only if the record shareholder objects with respect to all shares of the class or series owned by the beneficial shareholder and notifies the corporation in writing of the name and address of each beneficial shareholder on whose behalf appraisal rights are being asserted. The rights of a record shareholder who asserts appraisal rights for only part of the shares held of record in the record shareholder’s name under this subsection shall be determined as if the shares as to which the record shareholder objects and the record shareholder’s other shares were registered in the names of different record shareholders.
(b) A beneficial shareholder may assert appraisal rights as to shares of any class or series held on behalf of the shareholder only if such shareholder: (1) Submits to the corporation the record shareholder’s written consent to the assertion of such rights no later than the date referred to in subparagraph (B) of subdivision (2) of subsection (b) of section 33-862; and (2) does so with respect to all shares of the class or series that are beneficially owned by the beneficial shareholder.
(P.A. 94-186, S. 149, 215; P.A. 01-199, S. 17.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 revised and rephrased section including replacing “dissenters’ rights” with “appraisal rights” where appearing, amending Subsec. (a) to permit a record shareholder to assert appraisal rights as to fewer than all the shares registered in the record shareholder’s name “only if the record shareholder objects with respect to all shares of the class or series owned by the beneficial shareholder” rather than “only if he dissents with respect to all shares owned beneficially by any one person” and amending Subsec. (b) to permit a beneficial shareholder to assert appraisal rights as to shares “of any class or series” held on behalf of the shareholder, require in Subdiv. (1) the submission of the record shareholder’s written consent not later than the date referred to in Sec. 33-862(b)(2)(B) rather than not later than “the time the beneficial shareholder asserts dissenters’ rights” and require in Subdiv. (2) that the beneficial shareholder does so with respect to “all shares of the class or series that are beneficially owned by the beneficial shareholder” rather than “all shares of which he is the beneficial shareholder or over which he has power to direct the vote”.
Cited. 44 CS 12.
Secs. 33-858 and 33-859. Reserved for future use.
(B)
PROCEDURE FOR EXERCISE OF APPRAISAL RIGHTS
Sec. 33-860. Notice of appraisal rights. (a) Where any corporate action specified in subsection (a) of section 33-856 is to be submitted to a vote at a shareholders’ meeting, the meeting notice, or where no approval of such action is required pursuant to subdivision (10) of section 33-817, the offer made pursuant to subdivision (10) of section 33-817 must state that the corporation has concluded that the appraisal rights are, are not or may be available under sections 33-855 to 33-872, inclusive. If the corporation concludes that appraisal rights are or may be available, a copy of sections 33-855 to 33-872, inclusive, must accompany the meeting notice or offer sent to those record shareholders entitled to exercise appraisal rights.
(b) In a merger pursuant to section 33-818, the parent corporation shall notify in writing all record shareholders of the subsidiary who are entitled to assert appraisal rights that the corporate action became effective. Such notice shall be sent within ten days after the corporate action became effective and include the materials described in section 33-862.
(c) Where any corporate action specified in subsection (a) of section 33-856 is to be approved by written consent of the shareholders pursuant to section 33-698:
(1) Written notice that appraisal rights are, are not or may be available shall be sent to each record shareholder from whom a consent is solicited at the time consent of such shareholder is first solicited and, if the corporation has concluded that appraisal rights are or may be available, the notice must be accompanied by a copy of sections 33-855 to 33-872, inclusive; and
(2) Written notice that appraisal rights are, are not or may be available must be delivered together with the notice to nonconsenting and nonvoting shareholders required by subsections (e) and (f) of section 33-698, may include the materials described in section 33-862 and, if the corporation has concluded that appraisal rights are or may be available, must be accompanied by a copy of sections 33-855 to 33-872, inclusive.
(d) Where corporate action described in subsection (a) of section 33-856 is proposed, or a merger pursuant to section 33-818 is effected, the notice referred to in subsection (a) or (c) of this section, if the corporation concludes that appraisal rights are or may be available, and in subsection (b) of this section, shall be accompanied by:
(1) Financial statements of the corporation that issued the shares that may be subject to appraisal, consisting of a balance sheet as of the end of the fiscal year ending not more than sixteen months before the date of the notice, an income statement for that fiscal year and a cash flow statement for that fiscal year, provided if such financial statements are not reasonably available, the corporation shall provide reasonably equivalent financial information; and
(2) The latest interim financial statements of such corporation, if any.
(e) The right to receive the information described in subsection (d) of this section may be waived in writing by a shareholder before or after the corporate action.
(P.A. 94-186, S. 150, 215; P.A. 01-199, S. 18; P.A. 09-55, S. 8; P.A. 10-35, S. 4; P.A. 11-147, S. 20; P.A. 17-108, S. 17.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to rephrase provisions, replace “dissenters’ rights” with “appraisal rights” and permit the meeting notice to state that shareholders “are not” entitled to appraisal rights, deleted former Subsec. (b) re notification by the corporation of all shareholders entitled to assert dissenters’ rights when corporate action creating dissenters’ rights under Sec. 33-856 is taken without vote of shareholders and added new Subsec. (b) re notification by the parent corporation of all record shareholders of the subsidiary who are entitled to assert appraisal rights after a merger pursuant to Sec. 33-818; P.A. 09-55 amended Subsec. (a) to make slight changes in wording and added Subsec. (c) re notice of appraisal rights where any corporate action is to be approved by written consent of the shareholders; P.A. 10-35 added Subsec. (d) to require additional financial statements re proposed action under Sec. 33-856(a) or merger under Sec. 33-818, and added Subsec. (e) re waiver of right to receive information under Subsec. (d); P.A. 11-147 amended Subsec. (c)(1) to require notice to be “sent”, rather than “given”, to each record shareholder; P.A. 17-108 amended Subsec. (a) by adding provision re no approval of action required pursuant to Sec. 33-817(10), replacing “shareholders are, are not or may be” with “appraisal rights are, are not or may be available”, and adding “or offer”, amended Subsec. (b) by replacing “must” with “shall”, amended Subsec. (c) by replacing “must” with “shall” and adding “the notice” in Subdiv. (1), amended Subsec. (d) by replacing “any corporate action specified” with “corporate action described”, replacing provision re annual financial statements specified in Sec. 33-951 with “financial statements”, replacing “which shall be as of a date” with “consisting of a balance sheet as of the end of the fiscal year”, replacing provision re compliance with Sec. 33-951(b) with provision re income statement for fiscal year and cash flow statement for fiscal year in Subdiv. (1), replacing “available quarterly” with “interim” in Subdiv. (2), and made technical and conforming changes.
Cited. 44 CS 12.
Sec. 33-861. Notice of intent to demand payment. Consequences of voting or consenting. (a) If a corporate action specified in subsection (a) of section 33-856 is submitted to a vote at a shareholders’ meeting, a shareholder who wishes to assert appraisal rights with respect to any class or series of shares: (1) Shall deliver to the corporation, before the vote is taken, written notice of the shareholder’s intent to demand payment if the proposed action is effectuated, and (2) shall not vote, or cause or permit to be voted, any shares of such class or series in favor of the proposed action.
(b) If a corporate action specified in subsection (a) of section 33-856 is to be approved by written consent, a shareholder who wishes to assert appraisal rights with respect to any class or series of shares shall not sign a consent in favor of the proposed action with respect to that class or series of shares.
(c) If a corporate action specified in subsection (a) of section 33-856 does not require shareholder approval pursuant to subdivision (10) of section 33-817, a shareholder who wishes to assert appraisal rights with respect to any class or series of shares (1) shall deliver to the corporation before the shares are purchased pursuant to the offer written notice of the shareholder’s intent to demand payment if the proposed action is effected; and (2) shall not tender, or cause to permit to be tendered, any shares of such class or series in response to such offer.
(d) A shareholder who fails to satisfy the requirements of subsection (a), (b) or (c) of this section is not entitled to payment under sections 33-855 to 33-872, inclusive.
(P.A. 94-186, S. 151, 215; P.A. 01-199, S. 19; P.A. 09-55, S. 9; P.A. 11-147, S. 21; P.A. 17-108, S. 18.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 rephrased provisions, made technical changes and amended Subsec. (a) to replace “creating dissenters’ rights” with “requiring appraisal rights”, replace “assert dissenters’ rights” with “assert appraisal rights with respect to any class or series of shares”, provide in Subdiv. (2) that the shareholder must not “cause or permit to be voted” any shares “of such class or series” and make technical changes for purposes of gender neutrality; P.A. 09-55 amended Subsec. (a) to make slight changes in wording and technical changes, added new Subsec. (b) re prohibited action of shareholder who wishes to assert appraisal rights if a corporate action is to be approved by less than unanimous written consent, redesignated existing Subsec. (b) as Subsec. (c) and amended same to replace “does not” with “fails to” and add reference to requirements of Subsec. (b); P.A. 11-147 amended Subsec. (b) to replace “execute” with “sign”; P.A. 17-108 amended Subsecs. (a) and (b) by replacing “must” with “shall”, further amended Subsec. (b) by deleting “less than unanimous”, added new Subsec. (c) re shareholder who wishes to assert appraisal rights with respect to class or series of shares, redesignated existing Subsec. (c) as Subsec. (d) and amended same by adding reference to Subsec. (c) and making technical changes.
Sec. 33-862. Appraisal notice and form. (a) If a corporate action requiring appraisal rights under subsection (a) of section 33-856 becomes effective, the corporation shall deliver a written appraisal notice and the form required by subsection (b) of this section to all shareholders who satisfy the requirements of subsection (a), (b) or (c) of section 33-861. In the case of a merger under section 33-818, the parent shall deliver an appraisal notice and form to all record shareholders who may be entitled to assert appraisal rights.
(b) The appraisal notice shall be delivered no earlier than the date the corporate action specified in subsection (a) of section 33-856 became effective and no later than ten days after such date, and must:
(1) Supply a form that (A) specifies the first date of any announcement to shareholders made before the date the corporate action became effective of the principal terms of the proposed corporate action, (B) if such announcement was made, requires the shareholder asserting appraisal rights to certify whether beneficial ownership of those shares for which appraisal rights are asserted was acquired before that date, and (C) requires the shareholder asserting appraisal rights to certify that such shareholder did not vote for or consent to the transaction as to the class or series of shares for which appraisal is sought;
(2) State:
(A) Where the form shall be sent and where certificates for certificated shares shall be deposited and the date by which those certificates must be deposited, which date may not be earlier than the date by which the corporation must receive the required form under subparagraph (B) of this subdivision;
(B) A date by which the corporation must receive the form which date may not be fewer than forty nor more than sixty days after the date the appraisal notice under subsection (a) of this section is sent, and state that the shareholder shall have waived the right to demand appraisal with respect to the shares unless the form is received by the corporation by such specified date;
(C) The corporation’s estimate of the fair value of the shares;
(D) That, if requested in writing, the corporation will provide, to the shareholder so requesting, within ten days after the date specified in subparagraph (B) of this subdivision, the number of shareholders who return the forms by the specified date and the total number of shares owned by them; and
(E) The date by which the notice to withdraw under section 33-863 must be received, which date must be within twenty days after the date specified in subparagraph (B) of this subdivision; and
(3) Be accompanied by a copy of sections 33-855 to 33-872, inclusive.
(P.A. 94-186, S. 152, 215; P.A. 01-199, S. 20; P.A. 09-55, S. 2; P.A. 11-147, S. 22; P.A. 17-108, S. 19.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to revise and rephrase provisions, replace “dissenters’ rights” with “appraisal rights” and add provision re delivery of appraisal notice and form in the case of a merger under Sec. 33-818 and amended Subsec. (b) to substantially revise provisions, including replacing “dissenters’ notice” and “dissenters’ rights” with “appraisal notice” and “appraisal rights”, respectively, requiring the notice be sent “no earlier than the date the corporate action became effective and no later than ten days after such date” rather than “no later than ten days after the corporate action was taken”, redesignating former Subdiv. (3) as Subdiv. (1) and amending to rephrase provisions and require the shareholder to certify that the shareholder did not vote for the transaction, redesignating former Subdiv. (1) as Subdiv. (2)(A) and amending to rephrase provisions and add provision that the deposit date “may not be earlier than the date for receiving the required form” under Subdiv. (2)(B), redesignating former Subdiv. (4) as Subdiv. (2)(B) and amending to rephrase provisions, require the form be received by a date not fewer than 40 days, rather than 30 days, after the date the notice and form are sent and require the notice to state “that the shareholder shall have waived the right to demand appraisal with respect to the shares unless the form is received by the corporation by such specified date”, adding Subdiv. (2)(C) re estimate of the fair value of the shares, adding Subdiv. (2)(D) re information re number of shareholders who return forms and total number of shares owned by them, adding Subdiv. (2)(E) re date by which a notice to withdraw must be received and redesignating former Subdiv. (5) as Subdiv. (3); P.A. 09-55 amended introductory language of Subsec. (b) to replace “shall” with “must”, insert “specified in subsection (a) of section 33-856” and make a technical change, and amended Subsec. (b)(1) to revise and restructure provisions, including replacing “the date of the first announcement to shareholders” with “the first date of any announcement to shareholders made prior to the date the corporate action became effective”, making provision re certification of the acquisition of shares conditioned on “if such announcement was made” and applicable to the acquisition of “beneficial ownership” of those shares and requiring the shareholder to also certify that such shareholder did not “consent to” the transaction; P.A. 11-147 amended Subsec. (a) to require corporation to “send”, rather than “deliver”, notice and form and require parent to deliver “an appraisal notice and form”, rather than “a written appraisal notice and form”, and amended Subsec. (b) to require appraisal notice be “delivered”, rather than “sent”, and delete in Subdiv. (2)(B) reference to the form under Subsec. (a) being sent; P.A. 17-108 amended Subsec. (a) by replacing “proposed corporate action” with “a corporate action”, replacing “must send” with “shall deliver”, deleting “subdivision (1) of”, adding “subsection (a), (b) or (c) of” and replacing “parent must” with “parent shall”, amended Subsec. (b) by replacing “must” with “shall”, adding “as to the class or series of shares for which appraisal is sought” in Subdiv. (1), and replacing “date for receiving” with “date by which the corporation must receive” in Subdiv. (2), and made technical changes.
Cited. 44 CS 12.
Sec. 33-863. Perfection of rights. Right to withdraw. (a) A shareholder who receives notice pursuant to section 33-862 and who wishes to exercise appraisal rights must sign and return the form sent by the corporation and, in the case of certificated shares, deposit the shareholder’s certificates in accordance with the terms of the notice by the date referred to in the notice pursuant to subparagraph (B) of subdivision (2) of subsection (b) of section 33-862. In addition, if applicable, the shareholder must certify on the form whether the beneficial owner of such shares acquired beneficial ownership of the shares before the date required to be set forth in the notice pursuant to subdivision (1) of subsection (b) of section 33-862. If a shareholder fails to make this certification, the corporation may elect to treat the shareholder’s shares as after-acquired shares under section 33-867. Once a shareholder deposits that shareholder’s certificates or, in the case of uncertificated shares, returns the signed forms, that shareholder loses all rights as a shareholder, unless the shareholder withdraws pursuant to subsection (b) of this section.
(b) A shareholder who has complied with subsection (a) of this section may nevertheless decline to exercise appraisal rights and withdraw from the appraisal process by so notifying the corporation in writing by the date set forth in the appraisal notice pursuant to subparagraph (E) of subdivision (2) of subsection (b) of section 33-862. A shareholder who fails to so withdraw from the appraisal process may not thereafter withdraw without the corporation’s written consent.
(c) A shareholder who does not sign and return the form and, in the case of certificated shares, deposit that shareholder’s share certificates where required, each by the date set forth in the notice described in subsection (b) of section 33-862, shall not be entitled to payment under sections 33-855 to 33-872, inclusive.
(P.A. 94-186, S. 153, 215; P.A. 01-199, S. 21; P.A. 09-55, S. 10.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to revise and rephrase provisions, add provision that if a shareholder fails to make the certification the corporation may treat the shares as after-acquired shares under Sec. 33-867 and add provision that once a shareholder deposits the certificates or, in the case of uncertificated shares, returns the executed forms, the shareholder loses all rights as a shareholder unless the shareholder withdraws pursuant to Subsec. (b), deleted former Subsec. (b) re retention of all other rights of a shareholder who demands payment and deposits share certificates until the rights are cancelled or modified by the taking of the corporate action, added new Subsec. (b) re procedure for withdrawal by a shareholder from the appraisal process and amended Subsec. (c) to rephrase provisions; P.A. 09-55 amended Subsec. (a) to reposition provision re deposit of shareholder’s certificates and require shareholder to make a certification re acquisition date of beneficial ownership of shares only “if applicable”, and replaced “execute” and “executed” with “sign” and “signed” and made technical changes throughout.
Sec. 33-864. Share restrictions. Section 33-864 is repealed, effective October 1, 2001.
(P.A. 94-186, S. 154, 215; P.A. 01-199, S. 47.)
Sec. 33-865. Payment. (a) Except as provided in section 33-867, within thirty days after the form required by subparagraph (B) of subdivision (2) of subsection (b) of section 33-862 is due, the corporation shall pay in cash to those shareholders who complied with subsection (a) of section 33-863 the amount the corporation estimates to be the fair value of their shares, plus interest.
(b) The payment to each shareholder pursuant to subsection (a) of this section shall be accompanied by:
(1) (A) The annual financial statements specified in subsection (a) of section 33-951 of the corporation that issued the shares to be appraised, which shall be as of a date ending not more than sixteen months before the date of payment and shall comply with subsection (b) of section 33-951, except that, if such annual financial statements are not reasonably available, the corporation shall provide reasonably equivalent financial information, and (B) the latest available quarterly financial statements of such corporation, if any;
(2) A statement of the corporation’s estimate of the fair value of the shares which estimate must equal or exceed the corporation’s estimate given pursuant to subparagraph (C) of subdivision (2) of subsection (b) of section 33-862; and
(3) A statement that shareholders described in subsection (a) of this section have the right to demand further payment under section 33-868 and that if any such shareholder does not do so within the time period specified therein, such shareholder shall be deemed to have accepted such payment in full satisfaction of the corporation’s obligations under sections 33-855 to 33-872.
(P.A. 94-186, S. 155, 215; P.A. 98-137, S. 9, 62; 98-219, S. 33, 34; P.A. 01-199, S. 22; P.A. 10-35, S. 2.)
History: P.A. 94-186 effective January 1, 1997; P.A. 98-137 amended Subsec. (b) to replace in Subdiv. (4) reference to Sec. 33-860 with Sec. 33-868, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 01-199 amended Subsec. (a) to rephrase provisions, require payment within 30 days after the form required by Sec. 33-862(b)(2)(B) is due rather than “as soon as the proposed corporate action is taken or upon receipt of a payment demand”, require the payment to be “in cash” and make technical changes including changes for purposes of gender neutrality and amended Subsec. (b) to rephrase provisions, add in Subdiv. (2) the requirement that the estimate equal or exceed the corporation’s estimate given pursuant to Sec. 33-862(b)(2)(C), delete former Subdiv. (3) re an explanation of how the interest was calculated, redesignate former Subdiv. (4) as Subdiv. (3) and amend to rephrase provisions and add provision that if a shareholder fails to demand further payment within the specified time period such shareholder shall be deemed to have accepted such payment in full satisfaction of the corporation’s obligations and delete former Subdiv. (5) re a copy of Secs. 33-855 to 33-872, inclusive; P.A. 10-35 made a technical change in Subsec. (a) and amended Subsec. (b)(1) by inserting Subpara. designators (A) and (B), referencing statements specified in Sec. 33-951(a) as of a date, rather than fiscal year, ending not more than 16 months before date of payment, replacing requirement re income statement and statement of changes in shareholders’ equity with requirement that statement comply with Sec. 33-951(b) unless annual financial statements are not reasonably available, in which case corporation shall provide reasonably equivalent financial information, and adding provision re latest available quarterly financial statements, if any.
Sec. 33-866. Failure to take action. Section 33-866 is repealed, effective October 1, 2001.
(P.A. 94-186, S. 156, 215; P.A. 01-199, S. 47.)
Sec. 33-867. After-acquired shares. (a) A corporation may elect to withhold payment required by section 33-865 from any shareholder who was required to, but did not certify that beneficial ownership of all of the shareholder’s shares for which appraisal rights are asserted was acquired before the date set forth in the appraisal notice sent pursuant to subdivision (1) of subsection (b) of section 33-862.
(b) If the corporation elected to withhold payment under subsection (a) of this section, it must, within thirty days after the form required by subparagraph (B) of subdivision (2) of subsection (b) of section 33-862 is due, notify all shareholders who are described in subsection (a) of this section:
(1) Of the information required by subdivision (1) of subsection (b) of section 33-865;
(2) Of the corporation’s estimate of fair value pursuant to subdivision (2) of subsection (b) of section 33-865;
(3) That such shareholders may accept the corporation’s estimate of fair value, plus interest, in full satisfaction of their demands or demand payment under section 33-868;
(4) That those shareholders who wish to accept such offer must so notify the corporation of their acceptance of the corporation’s offer within thirty days after receiving the offer; and
(5) That those shareholders who do not satisfy the requirements for demanding payment under section 33-868 shall be deemed to have accepted the corporation’s offer.
(c) Within ten days after receiving the shareholder’s acceptance pursuant to subsection (b) of this section, the corporation must pay in cash the amount it offered under subdivision (2) of subsection (b) of this section to each shareholder who agreed to accept the corporation’s offer in full satisfaction of the shareholder’s demand.
(d) Within forty days after sending the notice described in subsection (b) of this section, the corporation must pay in cash the amount it offered to pay under subdivision (2) of subsection (b) of this section to each shareholder described in subdivision (5) of subsection (b) of this section.
(P.A. 94-186, S. 157, 215; P.A. 01-199, S. 23; P.A. 09-55, S. 11.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to rephrase provisions, amended Subsec. (b) to replace former provisions re payment by the corporation of each dissenter who agrees to accept the estimated fair value of the shares plus accrued interest in full satisfaction of his demand with provisions requiring a corporation that has elected to withhold payment to notify all shareholders described in Subsec. (a) and specifying in new Subdivs. (1) to (5) the contents of such notice, added new Subsec. (c) re payment of each shareholder who agreed to accept the corporation’s offer in full satisfaction of the shareholder’s demand and added new Subsec. (d) re payment of each shareholder described in Subsec. (b)(5); P.A. 09-55 amended Subsec. (a) to replace “any shareholder who did not certify” with “any shareholder who was required to, but did not certify”.
Cited. 44 CS 12.
Sec. 33-868. Procedure if shareholder dissatisfied with payment or offer. (a) A shareholder paid pursuant to section 33-865 who is dissatisfied with the amount of the payment must notify the corporation in writing of the shareholder’s estimate of the fair value of the shares and demand payment of that estimate, plus interest, less any payment under section 33-865. A shareholder offered payment under section 33-867 who is dissatisfied with that offer must reject the offer and demand payment of the shareholder’s stated estimate of the fair value of the shares plus interest.
(b) A shareholder who fails to notify the corporation in writing of the shareholder’s demand to be paid the shareholder’s stated estimate of the fair value of the shares plus interest under subsection (a) of this section within thirty days after receiving the corporation’s payment under section 33-865 or offer of payment under section 33-867 waives the right to demand payment under this section and shall be entitled only to the payment made under section 33-865 or the payment offered under section 33-867.
(P.A. 94-186, S. 158, 215; P.A. 01-199, S. 24.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to revise and rephrase provisions including replacing “dissenter” with “shareholder” where appearing, deleting provisions authorizing the dissenter to demand payment if the corporation fails to make payment under Sec. 33-865 within 60 days after the date set for demanding payment and if the corporation fails to take the proposed action and does not return the deposited certificates or release the transfer restrictions imposed on uncertificated shares within 60 days after the date set for demanding payment and amended Subsec. (b) to rephrase provisions re waiver by a shareholder of the right to demand payment and add provision that such shareholder shall be entitled only to the payment made under Sec. 33-865 or the payment offered under Sec. 33-867.
Secs. 33-869 and 33-870. Reserved for future use.
(C)
JUDICIAL APPRAISAL OF SHARES
Sec. 33-871. Court action. (a) If a shareholder makes demand for payment under section 33-868 which remains unsettled, the corporation shall commence a proceeding within sixty days after receiving the payment demand and petition the court to determine the fair value of the shares and accrued interest. If the corporation does not commence the proceeding within the sixty-day period, it shall pay in cash to each shareholder the amount the shareholder demanded pursuant to section 33-868 plus interest.
(b) The corporation shall commence the proceeding in the superior court for the judicial district where a corporation’s principal office or, if none, its registered office in this state is located. If the corporation is a foreign corporation without a registered office in this state, it shall commence the proceeding in the superior court for the judicial district where the principal office or registered office of the domestic corporation that merged with the foreign corporation was located at the time of the transaction.
(c) The corporation shall make all shareholders, whether or not residents of this state, whose demands remain unsettled parties to the proceeding as in an action against their shares and all parties must be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law.
(d) The jurisdiction of the court in which the proceeding is commenced under subsection (b) of this section is plenary and exclusive. The court may appoint one or more persons as appraisers to receive evidence and recommend a decision on the question of fair value. The appraisers shall have the powers described in the order appointing them, or in any amendment to it. The shareholders demanding appraisal rights are entitled to the same discovery rights as parties in other civil proceedings. There shall be no right to a jury trial.
(e) Each shareholder made a party to the proceeding is entitled to judgment (1) for the amount, if any, by which the court finds the fair value of the shareholder’s shares, plus interest, exceeds the amount paid by the corporation to the shareholder for such shares, or (2) for the fair value, plus interest, of the shareholder’s shares for which the corporation elected to withhold payment under section 33-867.
(P.A. 94-186, S. 159, 215; P.A. 01-199, S. 25.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to rephrase provisions and require the corporation to “pay in cash to each shareholder the amount the shareholder demanded pursuant to section 33-868 plus interest” rather than “pay each dissenter whose demand remains unsettled the amount demanded”, amended Subsec. (b) to rephrase provisions and provide that venue for a foreign corporation without a registered office in this state is the judicial district “where the principal office or registered office of the domestic corporation that merged with the foreign corporation was located at the time of the transaction” rather than “where the registered office of the domestic corporation merged with or whose shares acquired by the foreign corporation was located”, amended Subsec. (c) to replace “dissenters” with “shareholders”, amended Subsec. (d) to replace “dissenters” with “shareholders demanding appraisal rights”, provide that there shall be no right to a jury trial and make technical changes and amended Subsec. (e) to rephrase provisions, replace “dissenter” with “shareholder” and make technical changes including changes for purposes of gender neutrality.
Sec. 33-872. Court costs and expenses. (a) The court in an appraisal proceeding commenced under section 33-871 shall determine all court costs of the proceeding, including the reasonable compensation and expenses of appraisers appointed by the court. The court shall assess the court costs against the corporation, except that the court may assess court costs against all or some of the shareholders demanding appraisal, in amounts the court finds equitable, to the extent the court finds such shareholders acted arbitrarily, vexatiously or not in good faith with respect to the rights provided by sections 33-855 to 33-872, inclusive.
(b) The court in an appraisal proceeding may also assess the expenses of the respective parties, in amounts the court finds equitable: (1) Against the corporation and in favor of any or all shareholders demanding appraisal if the court finds the corporation did not substantially comply with the requirements of sections 33-860 to 33-868, inclusive; or (2) against either the corporation or a shareholder demanding appraisal, in favor of any other party, if the court finds that the party against whom the expenses are assessed acted arbitrarily, vexatiously or not in good faith with respect to the rights provided by sections 33-855 to 33-872, inclusive.
(c) If the court in an appraisal proceeding finds that the expenses incurred by any shareholder were of substantial benefit to other shareholders similarly situated, and that such expenses should not be assessed against the corporation, the court may direct that such expenses be paid out of the amounts awarded the shareholders who were benefited.
(d) To the extent the corporation fails to make a required payment pursuant to section 33-865, 33-867 or 33-868, the shareholder may sue directly for the amount owed and, to the extent successful, shall be entitled to recover from the corporation all expenses of the suit.
(P.A. 94-186, S. 160, 215; P.A. 01-199, S. 26; P.A. 09-55, S. 19.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (a) to replace references to “dissenters” with “shareholders demanding appraisal” or “shareholders” and replace “in demanding payment under section 33-868” with “with respect to the rights provided by sections 33-855 to 33-872, inclusive”, amended Subsec. (b) to specify that the provisions apply “in an appraisal proceeding”, replace “dissenters” and “dissenter” with “shareholders demanding appraisal” and “shareholder demanding appraisal”, respectively, amended Subsec. (c) to specify that the provisions apply “in an appraisal proceeding” and replace “dissenter” and “dissenters” with “shareholder” and “shareholders”, respectively, and added new Subsec. (d) authorizing the shareholder to sue directly for the amount owed if the corporation fails to make a required payment and entitling a successful shareholder to recover all costs and expenses of suit including counsel fees; P.A. 09-55 amended Subsec. (a) to replace “costs” with “court costs”, amended Subsec. (b) to replace “the fees and expenses of counsel and experts for the respective parties” with “the expenses of the respective parties” and replace in Subdiv. (2) “fees and expenses” with “expenses”, amended Subsec. (c) to replace “the services of counsel for any shareholder” with “the expenses incurred by any shareholder”, replace “the fees for those services” with “such expenses” and replace “may award to such counsel reasonable fees to be paid” with “may direct that such expenses be paid” and amended Subsec. (d) to replace “all costs and expenses of the suit, including counsel fees” with “all expenses of the suit”.
Cited. 44 CS 12.
Secs. 33-873 to 33-879. Reserved for future use.
PART XIV
DISSOLUTION
(A)
VOLUNTARY DISSOLUTION
Sec. 33-880. Dissolution by incorporators or initial directors. A majority of the incorporators or initial directors of a corporation that has not issued shares or has not commenced business may dissolve the corporation by delivering to the Secretary of the State for filing a certificate of dissolution that sets forth: (1) The name of the corporation; (2) either (A) that none of the corporation’s shares have been issued or (B) that the corporation has not commenced business; (3) that no debt of the corporation remains unpaid; (4) that the net assets of the corporation remaining after winding up have been distributed to the shareholders, if shares were issued; and (5) that a majority of the incorporators or initial directors authorize the dissolution.
(P.A. 94-186, S. 161, 215; P.A. 96-271, S. 112, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of dissolution with “certificate” of dissolution, effective January 1, 1997.
Sec. 33-881. Dissolution by board of directors and shareholders. (a) A corporation’s board of directors may propose dissolution for submission to the shareholders.
(b) For a proposal to dissolve to be adopted:
(1) The board of directors must recommend dissolution to the shareholders unless (A) the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation, or (B) section 33-754 applies. If subparagraph (A) or (B) of this subdivision applies, the board of directors must transmit to the shareholders the basis for so proceeding; and
(2) The shareholders entitled to vote must approve the proposal to dissolve as provided in subsection (e) of this section.
(c) The board of directors may condition its submission of the proposal for dissolution on any basis.
(d) The corporation shall notify each shareholder, whether or not entitled to vote, of the proposed shareholders’ meeting in accordance with section 33-699. The notice must also state that the purpose, or one of the purposes, of the meeting is to consider dissolving the corporation.
(e) Unless the certificate of incorporation or the board of directors acting pursuant to subsection (c) of this section requires a greater vote or a vote by voting groups, and except as provided in subsection (f) of this section, the proposal to dissolve to be adopted must be approved by a majority of all the votes entitled to be cast on that proposal.
(f) Notwithstanding any provision of subsection (e) of this section to the contrary, a proposal to dissolve a corporation which was incorporated under the laws of this state, whether under chapter 599 of the general statutes, revised to January 1, 1995, or any general law or special act, prior to January 1, 1997, shall, unless the certificate of incorporation expressly provides otherwise, be approved by the affirmative vote of at least two-thirds of the voting power of each voting group entitled to vote thereon.
(P.A. 94-186, S. 162, 215; P.A. 96-271, S. 113, 114, 254; P.A. 10-35, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (f) to replace “January 1, 1996” with “January 1, 1997”, effective January 1, 1997; P.A. 10-35 amended Subsec. (b)(1) to designate existing provisions re board determination that it should not make a recommendation due to conflicts of interest or other special circumstances as Subpara. (A), add Subpara. (B) re whether Sec. 33-754 applies, provide that if Subpara. (A) or (B) applies, board must transmit to shareholders basis for so proceeding, rather than basis for its determination, and make technical changes.
Sec. 33-882. Certificate of dissolution. (a) At any time after dissolution is authorized, the corporation may dissolve by delivering to the Secretary of the State for filing a certificate of dissolution setting forth: (1) The name of the corporation; (2) the date dissolution was authorized; and (3) if dissolution was approved by the shareholders, a statement that the proposal to dissolve was duly approved by the shareholders in the manner required by sections 33-600 to 33-998, inclusive, and by the certificate of incorporation.
(b) A corporation is dissolved upon the effective date of its certificate of dissolution.
(c) For the purposes of sections 33-880 to 33-903, inclusive, “dissolved corporation” means a corporation whose certificate of dissolution has become effective and includes a successor entity to which the remaining assets of the corporation are transferred subject to the corporation’s liabilities for purposes of liquidation.
(P.A. 94-186, S. 163, 215; P.A. 96-271, S. 115, 254; P.A. 97-246, S. 25, 99; P.A. 03-18, S. 27.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of dissolution with “certificate” of dissolution where appearing, effective January 1, 1997; P.A. 97-246 amended Subsec. (b) to replace “plan to dissolve” with “proposal for dissolution”, effective June 27, 1997; P.A. 03-18 amended Subsec. (a) by making a technical change and, in Subdiv. (3), replacing former Subparas. (A) and (B) with provision re statement that proposal to dissolve was duly approved by the shareholders, deleted former Subsec. (b) re information provided to voting groups, redesignated existing Subsec. (c) as new Subsec. (b) and added new Subsec. (c) defining “dissolved corporation”, effective July 1, 2003.
Sec. 33-883. Revocation of dissolution. (a) A corporation may revoke its dissolution within one hundred twenty days of its effective date.
(b) Revocation of dissolution must be authorized in the same manner as the dissolution was authorized unless that authorization permitted revocation by action of the board of directors alone, in which event the board of directors may revoke the dissolution without shareholder action.
(c) After the revocation of dissolution is authorized, the corporation may revoke the dissolution by delivering to the Secretary of the State for filing a certificate of revocation of dissolution that (1) sets forth: (A) The name of the corporation; (B) the effective date of the dissolution that was revoked; (C) the date that the revocation of dissolution was authorized; (D) if the corporation’s board of directors, or incorporators, revoked the dissolution, a statement to that effect; (E) if the corporation’s board of directors revoked a dissolution authorized by the shareholders, a statement that revocation was permitted by action by the board of directors alone pursuant to that authorization; and (F) if shareholder action was required to revoke the dissolution, the information required by subdivision (3) of subsection (a) of section 33-882; and (2) if the name of the corporation whose dissolution is to be revoked is no longer available, is accompanied by an amendment of the certificate of incorporation which changes the name of the corporation to an available name.
(d) Revocation of dissolution is effective upon the effective date of the certificate of revocation of dissolution.
(e) When the revocation of dissolution is effective, it relates back to and takes effect as of the effective date of the dissolution and the corporation resumes carrying on its business as if dissolution had never occurred.
(P.A. 94-186, S. 164, 215; P.A. 96-271, S. 116, 254; P.A. 97-246, S. 26, 99; P.A. 03-18, S. 28; P.A. 04-257, S. 52.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of revocation of dissolution with “certificate” of revocation of dissolution and “articles” of dissolution with “certificate” of dissolution where appearing, effective January 1, 1997; P.A. 97-246 amended Subsec. (c) to delete requirement that the corporation include “a copy of its certificate of dissolution” when it delivers a certificate of revocation of dissolution to the Secretary of the State for filing and add new Subdiv. (7) requiring delivery of an amendment of the certificate of incorporation changing the name of the corporation to an available name if the name of the corporation whose dissolution is to be revoked is no longer available, effective June 27, 1997; P.A. 03-18 amended Subsec. (c)(6) by deleting reference to Sec. 33-882(b), effective July 1, 2003; P.A. 04-257 made technical changes in Subsec. (c), effective June 14, 2004.
Sec. 33-884. Effect of dissolution. (a) A dissolved corporation continues its corporate existence but may not carry on any business except that appropriate to wind up and liquidate its business and affairs, including: (1) Collecting its assets; (2) disposing of its properties that will not be distributed in kind to its shareholders; (3) discharging or making provision for discharging its liabilities; (4) distributing its remaining property among its shareholders according to their interests; and (5) doing every other act necessary to wind up and liquidate its business and affairs.
(b) Dissolution of a corporation does not: (1) Transfer title to the corporation’s property; (2) prevent transfer of its shares or securities, although the authorization to dissolve may provide for closing the corporation’s share transfer records; (3) subject its directors or officers to standards of conduct different from those prescribed in sections 33-735 to 33-784, inclusive; (4) change quorum or voting requirements for its board of directors or shareholders; change provisions for selection, resignation or removal of its directors or officers or both; or change provisions for amending its bylaws; (5) prevent commencement of a proceeding by or against the corporation in its corporate name; (6) abate or suspend a proceeding pending by or against the corporation on the effective date of dissolution; (7) terminate the authority of the registered agent of the corporation; or (8) of itself render the shareholders liable for any liability or other obligations of the corporation nor vest title to the property of the corporation in the shareholders.
(P.A. 94-186, S. 165, 215; P.A. 96-271, S. 117, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 added Subsec. (b)(8) providing dissolution does not of itself render the shareholders liable for corporate liabilities or obligations or vest title to corporate property in the shareholders, effective January 1, 1997.
Sec. 33-885. Requirements prior to final liquidating distribution of assets. No final liquidating distribution of assets shall be made to shareholders by a dissolved corporation until the corporation has obtained a current statement or statements from the Commissioner of Revenue Services and the administrator of the unemployment compensation law, acting in their respective capacities, showing, to the best of their knowledge and belief, as of the date of such respective statements, either that such corporation has paid all its taxes and contributions or that it was not liable for any taxes or contributions, or that it has made adequate provisions, with such surety as shall be satisfactory to said commissioner and said administrator, for the future payment of any of its unpaid taxes and unpaid contributions as of the date of such respective statements. As used in this section, the word “tax” means the whole, or any installment or part, of any tax, excise, fee or license and any interest, penalty and other legal accumulation thereon, payable to the Commissioner of Revenue Services, for which the corporation is liable and the word “contribution” means any and all moneys payable under any provision of the unemployment compensation law, for which the particular corporation is liable.
(P.A. 94-186, S. 166, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-886. Known claims against dissolved corporation. (a) A dissolved corporation may dispose of the known claims against it by notifying its known claimants in writing of the dissolution at any time after the effective date of the dissolution.
(b) The written notice shall: (1) Describe information that must be included in a claim; (2) provide a mailing address where a claim may be sent; (3) state the deadline, which may not be fewer than one hundred twenty days from the effective date of the written notice, by which the dissolved corporation must receive the claim; and (4) state that the claim will be barred if not received by the deadline.
(c) A claim against the dissolved corporation is barred: (1) If a claimant who was given written notice under subsection (b) of this section does not deliver the claim to the dissolved corporation by the deadline; or (2) if a claimant whose claim was rejected by the dissolved corporation does not commence a proceeding to enforce the claim within ninety days from the effective date of the rejection notice.
(d) For purposes of this section, “claim” does not include a contingent liability or a claim based on an event occurring after the effective date of the dissolution.
(P.A. 94-186, S. 167, 215; P.A. 96-271, S. 118, 254; P.A. 03-18, S. 29.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 added Subsec. (e) re extension of any applicable period of limitation, effective January 1, 1997; P.A. 03-18 amended Subsec. (a) by replacing “following the procedure described in this section” with “notifying its known claimants in writing of the dissolution at any time after the effective date of the dissolution”, amended Subsec. (b) by deleting provision re notice to known claimants, made technical changes in Subsecs. (c) and (d) and deleted former Subsec. (e) re nothing in section to extend any applicable limitation period, effective July 1, 2003.
Sec. 33-887. Unknown claims against dissolved corporation. (a) A dissolved corporation may also publish notice of its dissolution and request that persons with claims against the dissolved corporation present them in accordance with the notice.
(b) The notice shall: (1) Be published one time in a newspaper of general circulation in the county where the dissolved corporation’s principal office or, if none in this state, its registered office, is or was last located; (2) describe the information that must be included in a claim and provide a mailing address where the claim may be sent; and (3) state that a claim against the dissolved corporation will be barred unless a proceeding to enforce the claim is commenced within three years after the publication of the notice.
(c) If the dissolved corporation publishes a newspaper notice in accordance with subsection (b) of this section, the claim of each of the following claimants is barred unless the claimant commences a proceeding to enforce the claim against the dissolved corporation within three years after the publication date of the newspaper notice: (1) A claimant who was not given written notice under section 33-886; (2) a claimant whose claim was timely sent to the dissolved corporation but not acted on; and (3) a claimant whose claim is contingent or based on an event occurring after the effective date of dissolution.
(d) A claim that is not barred by subsection (c) of section 33-886 or subsection (c) of this section may be enforced under this section: (1) Against the dissolved corporation, to the extent of its undistributed assets; or (2) except as provided in subsection (d) of section 33-887a, if the assets have been distributed in liquidation, against a shareholder of the dissolved corporation to the extent of the shareholder’s pro rata share of the claim or the corporate assets distributed to the shareholder in liquidation, whichever is less, but a shareholder’s total liability for all claims under this section may not exceed the total amount of assets distributed to the shareholder.
(e) Nothing in this section shall extend any applicable period of limitation.
(P.A. 94-186, S. 168, 215; P.A. 96-271, S. 119, 254; P.A. 03-18, S. 30.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 added Subsec. (e) re extension of any applicable period of limitation, effective January 1, 1997; P.A. 03-18 made technical changes in Subsecs. (a) and (b), amended Subsec. (c) by replacing “did not receive written notice” with “was not given written notice” in Subdiv. (1) and making a technical change, and amended Subsec. (d) by adding provision re claim that is not barred by Sec. 33-886(c) or Subsec. (c) and, in Subdiv. (2), adding exception to provisions of Sec. 33-887a(d) and making technical changes, effective July 1, 2003.
Sec. 33-887a. Proceeding for determination of security for payment of contingent or unknown claims or claims arising after dissolution. (a) A dissolved corporation that has published a notice under section 33-887 may file an application with the superior court for the judicial district where the dissolved corporation’s principal office or, if none in this state, its registered office, is located for a determination of the amount and form of security to be provided for payment of claims that are contingent or have not been made known to the dissolved corporation or that are based on an event occurring after the effective date of dissolution but that, based on the facts known to the dissolved corporation, are reasonably estimated to arise after the effective date of dissolution. Provision need not be made for any claim that is or is reasonably anticipated to be barred under subsection (c) of section 33-887.
(b) Within ten days after the filing of an application under subsection (a) of this section, notice of the proceeding shall be given by the dissolved corporation to each claimant holding a contingent claim whose contingent claim is shown on the records of the dissolved corporation.
(c) The court may appoint a guardian ad litem to represent all claimants whose identities are unknown in any proceeding brought under this section. The reasonable fees and expenses of such guardian, including all reasonable expert witness fees, shall be paid by the dissolved corporation.
(d) Provision by the dissolved corporation for security in the amount and the form ordered by the court under subsection (a) of this section shall satisfy the dissolved corporation’s obligations with respect to claims that are contingent, have not been made known to the dissolved corporation or are based on an event occurring after the effective date of dissolution, and such claims may not be enforced against a shareholder who received assets in liquidation.
(P.A. 03-18, S. 31.)
History: P.A. 03-18 effective July 1, 2003.
Sec. 33-887b. Duties of directors of dissolved corporation. (a) Directors of a dissolved corporation shall cause the dissolved corporation to discharge or make reasonable provision for the payment of claims and make distributions of assets to shareholders after payment of or provision for claims.
(b) Directors of a dissolved corporation which has disposed of claims under section 33-886, 33-887 or 33-887a shall not be liable for breach of subsection (a) of this section with respect to claims against the dissolved corporation that are barred or satisfied under section 33-886, 33-887 or 33-887a.
(P.A. 03-18, S. 32.)
History: P.A. 03-18 effective July 1, 2003.
The obligations of a director of a dissolved corporation under section apply when, at the time of dissolution, plaintiff’s claim had not been disposed of, but rather had been filed in small claims court and was disputed by defendant. 157 CA 297.
Secs. 33-888 and 33-889. Reserved for future use.
(B)
ADMINISTRATIVE DISSOLUTION
Sec. 33-890. Administrative dissolution. (a) The Secretary of the State may effect the administrative dissolution of a corporation as provided in this section.
(b) Whenever any corporation is more than one year in default of filing its annual report as required by section 33-953, the Secretary of the State may notify such corporation by first class mail addressed to such corporation at its principal office as last shown on the Secretary’s records that under the provisions of this section the corporation is to be administratively dissolved. Unless the corporation, within three months of the mailing of such notice, files such annual report, the Secretary of the State shall prepare and file in the Secretary’s office a certificate of administrative dissolution stating that the delinquent corporation has been administratively dissolved by reason of its default.
(c) Whenever it comes to the attention of the Secretary of the State that a corporation has failed to maintain a registered agent or that such registered agent cannot, with reasonable diligence, be found at the address shown in the records of his office, the Secretary of the State may notify such corporation by registered or certified mail addressed to such corporation at its principal office as last shown on his records that under the provisions of this section the corporation is to be administratively dissolved. Unless the corporation within three months of the mailing of such notice files an appointment of registered agent, the Secretary of the State shall prepare and file in his office a certificate of administrative dissolution stating that the delinquent corporation has been administratively dissolved by reason of its default.
(d) Dissolution shall be effective upon the filing by the Secretary of the State in his office of such certificate of administrative dissolution.
(e) After filing the certificate of administrative dissolution, the Secretary of the State shall: (1) Mail a copy thereof to the delinquent corporation, addressed to such corporation at its principal office as last shown on his records; and (2) cause notice of the filing of such certificate of administrative dissolution to be posted on the office of the Secretary of the State’s Internet web site for a period of sixty days following the date on which the Secretary of the State files the certificate of administrative dissolution.
(P.A. 94-186, S. 169, 215; P.A. 95-252, S. 30, 36; P.A. 96-271, S. 120, 254; P.A. 14-154, S. 2; P.A. 19-40, S. 8.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-252 deleted former Subsec. (b) re the administrative dissolution of a corporation that is in default of filing its annual or biennial reports, relettering the remaining Subsecs. accordingly, effective January 1, 1997; P.A. 96-271 made technical changes, effective January 1, 1997; P.A. 14-154 added new Subsec. (b) re administrative dissolution of corporation that is in default of filing annual report, redesignated existing Subsecs. (b) to (d) as Subsecs. (c) to (e) and amended redesignated Subsec. (e) by deleting requirements that certificate of administrative dissolution be sent by registered or certified mail and published in 2 successive issues of the Connecticut Law Journal and by adding requirement that Secretary of the State cause notice of filing of certificate of administrative dissolution to be posted on the office’s web site, effective January 1, 2015; P.A. 19-40 amended Subsec. (b) by replacing “registered or certified mail” with “first class mail” and by making technical changes, effective January 1, 2020.
Sec. 33-891. Effect of administrative dissolution. (a) A corporation administratively dissolved continues its corporate existence but may not carry on any business except that necessary to wind up and liquidate its business and affairs under section 33-884 and notify claimants under sections 33-886 and 33-887.
(b) The administrative dissolution of a corporation does not terminate the authority of its registered agent.
(P.A. 94-186, S. 170, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-892. Reinstatement following administrative dissolution. (a) A corporation administratively dissolved may apply to the Secretary of the State for reinstatement after the effective date of dissolution. The application must: (1) Recite the name of the corporation; (2) if the name of the corporation to be reinstated is no longer available, be accompanied simultaneously by an amendment of the certificate of incorporation which identifies an available name; and (3) be accompanied by: (A) Payment of all penalties and forfeitures incurred by the corporation and a reinstatement fee; (B) an annual report for the current year; (C) an up-to-date statement or statements from the Commissioner of Revenue Services and the administrator of the unemployment compensation law acting in their respective capacities, showing, to the best of their knowledge and belief, as of the date of such respective statements, either that such corporation has paid all its taxes and contributions or that it was not liable for any taxes or contributions, or that it has made adequate provisions, with such surety as shall be satisfactory to said commissioner and said administrator, for the future payment of any of its unpaid taxes and unpaid contributions as of the date of such respective statements provided, if said commissioner or administrator, as the case may be, does not issue such statement within five weeks of the request therefor, the filing of such statement shall not be required under this subparagraph; and (D) an appointment of a registered agent.
(b) If the Secretary of the State determines that the application contains the information required by subsection (a) of this section and that the information is correct, he shall prepare a certificate of reinstatement that recites his determination and the effective date of reinstatement and file the original of the certificate.
(c) When the reinstatement is effective, it relates back to and takes effect as of the effective date of the administrative dissolution and the corporation resumes carrying on its business as if the administrative dissolution had never occurred.
(P.A. 94-186, S. 171, 215; P.A. 96-271, S. 121, 254; P.A. 97-246, S. 27, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to correct a statutory reference, delete the three-year time limitation on reinstatement after dissolution and replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to delete reference to administrative dissolution “under section 33-890” and delete former Subdiv. (2) that had required the application to “state that the ground or grounds for dissolution either did not exist or have been eliminated”, renumbering the remaining Subdivs. accordingly, effective June 27, 1997.
Participation in unrelated lawsuit does not establish classical aggrievement and section does not extend statutory standing to third parties to challenge the general fitness of an applicant for reinstatement. 119 CA 771.
Sec. 33-893. Appeal from refusal of reinstatement. (a) If the Secretary of the State refuses to file the application for reinstatement, he shall return it to the corporation or its representative within five days after the application was delivered, together with a brief written explanation of the reason for his refusal.
(b) The corporation may appeal the refusal of the Secretary of the State to file the application for reinstatement to the superior court for the judicial district where the corporation’s principal office or, if none in this state, its registered office, is located within thirty days after return of the application. The corporation appeals by petitioning the court to set aside the dissolution and attaching to the petition copies of the Secretary of the State’s certificate of administrative dissolution, the corporation’s application for reinstatement and the Secretary of the State’s explanation of the reason for his refusal to file the application for reinstatement.
(c) The court may summarily order the Secretary of the State to reinstate the dissolved corporation or may take other action the court considers appropriate.
(d) The court’s final decision may be appealed as in other civil proceedings.
(P.A. 94-186, S. 172, 215; P.A. 96-271, S. 122, 123, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to delete “domestic or foreign” before “corporation” and amended Subsec. (b) to authorize the corporation to appeal “the refusal of the Secretary of the State to file the application for reinstatement” rather than appeal “the denial of reinstatement”, provide that the appeal must be filed 30 days after “return of the application” rather than after “service of the notice of denial is perfected”, require the corporation to attach to the petition a copy of the Secretary of the State’s “explanation of the reason for his refusal to file the application for reinstatement” rather than a copy of said Secretary’s “notice of denial” and make a technical change, effective January 1, 1997.
Secs. 33-894 and 33-895. Reserved for future use.
(C)
JUDICIAL DISSOLUTION
Sec. 33-896. Grounds for judicial dissolution. (a) The superior court for the judicial district where the corporation’s principal office or, if none in this state, its registered office, is located may dissolve a corporation:
(1) In a proceeding by a shareholder if it is established that: (A) (i) The directors are deadlocked in the management of the corporate affairs, (ii) the shareholders are unable to break the deadlock, and (iii) irreparable injury to the corporation is threatened or being suffered or the business and affairs of the corporation can no longer be conducted to the advantage of the shareholders generally, because of the deadlock; (B) 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; (C) the shareholders are deadlocked in voting power and have failed, for a period that includes at least two consecutive annual meeting dates, to elect successors to directors whose terms have expired; or (D) the corporate assets are being misapplied or wasted;
(2) In a proceeding by a creditor if it is established that: (A) The creditor’s claim has been reduced to judgment, the execution on the judgment returned unsatisfied and the corporation is insolvent; or (B) the corporation has admitted in writing that the creditor’s claim is due and owing and the corporation is insolvent; or
(3) In a proceeding by the corporation to have its voluntary dissolution continued under court supervision.
(b) Subdivision (1) of subsection (a) of this section shall not apply in the case of a corporation that, on the date of the filing of the proceeding, has shares that are: (A) Listed on the New York Stock Exchange, the American Stock Exchange or any exchange owned or operated by the NASDAQ Stock Market LLC, or listed or quoted on a system owned or operated by the National Association of Securities Dealers, Inc.; or (B) not so listed or quoted, but are held by at least three hundred shareholders and the shares outstanding have a market value of at least twenty million dollars exclusive of the value of such shares held by the corporation’s subsidiaries, senior executives, directors and beneficial shareholders owning more than ten per cent of such shares.
(P.A. 94-186, S. 173, 215; P.A. 96-271, S. 124, 254; P.A. 09-55, S. 23; P.A. 17-108, S. 45.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a)(1) to delete as grounds for dissolution Subpara. (A) re deadlock of the directors and Subpara. (C) re deadlock of the shareholders, relettering the remaining Subparas. accordingly, and amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation where appearing and replace in Subdiv. (2)(B) “agree upon or vote for directors as successors” with “elect successors”, effective January 1, 1997; P.A. 09-55 amended Subsec. (a)(1) to add new Subpara. (A) re director deadlock, redesignate existing Subpara. (A) as Subpara. (B), add Subpara. (C) re shareholder deadlock and redesignate existing Subpara. (B) as Subpara. (D), and replaced former Subsec. (b) re mandatory judicial dissolution with new Subsec. (b) re corporations to which provisions of Subsec. (a)(1) do not apply; P.A. 17-108 amended Subsec. (b) to delete definition of “beneficial shareholder”.
Even where shareholder agreement contains a stalemate provision, the language must be clear and unequivocal before it will be held to waive stockholder’s right to seek dissolution of the corporation. 55 CA 272.
Subsec. (b):
Where there is a continuing failure to hold annual meetings, and there appears to be no chance of breaking the deadlock between the parties, it is proper to dissolve the corporation. 55 CA 272.
Sec. 33-897. Procedure for judicial dissolution. (a) Venue for a proceeding brought by any party named in section 33-896 lies in the judicial district where a corporation’s principal office or, if none in this state, its registered office is or was last located.
(b) It is not necessary to make shareholders parties to a proceeding to dissolve a corporation unless relief is sought against them individually.
(c) A court in a proceeding brought to dissolve a corporation may issue injunctions, appoint a receiver or custodian pendente lite with all powers and duties the court directs, take other action required to preserve the corporate assets wherever located and carry on the business of the corporation until a full hearing can be held.
(d) Within ten days of the commencement of a proceeding under subdivision (1) of subsection (a) of section 33-896 to dissolve a corporation, the corporation must send to all shareholders, other than the petitioner, a notice stating that the shareholders are entitled to avoid the dissolution of the corporation by electing to purchase the petitioner’s shares under section 33-900 and accompanied by a copy of said section.
(P.A. 88-230, S. 1, 12; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; P.A. 94-186, S. 174, 215; P.A. 95-220, S. 4–6; P.A. 96-271, S. 125, 126, 254; June Sp. Sess. P.A. 98-1, S. 119, 121; P.A. 06-68, S. 13; P.A. 09-55, S. 24.)
History: P.A. 94-186 effective January 1, 1997 (Revisor’s note: P.A. 88-230, P.A. 90-98 and P.A. 93-142 authorized substitution of “judicial district of Hartford” for “judicial district of Hartford-New Britain” in public and special acts of the 1994 regular and special sessions, effective September 1, 1996); P.A. 95-220 changed the effective date of P.A. 88-230 from September 1, 1996, to September 1, 1998, effective July 1, 1995; P.A. 96-271 amended Subsec. (a) to delete provision establishing venue for a dissolution proceeding by the Attorney General in the Hartford-New Britain judicial district and amended Subsec. (d) to correct statutory reference, effective January 1, 1997; June Sp. Sess. P.A. 98-1 added phrase “or subdivision (2) of subsection (b)” in Subsec. (d), effective June 24, 1998; P.A. 06-68 amended Subsec. (d) by deleting reference to Sec. 33-896(b)(2) and replacing “has no shares listed on a national securities exchange or regularly traded in a market maintained by one or more members of a national securities exchange” with “is not a public corporation”; P.A. 09-55 amended Subsec. (d) to delete provision making requirement applicable only to corporation “that is not a public corporation”.
Sec. 33-898. Receivership or custodianship. (a) Unless an election to purchase has been filed under section 33-900, a court in a judicial proceeding brought to dissolve a corporation may appoint one or more receivers to wind up and liquidate, or one or more custodians to manage, the business and affairs of the corporation. The court shall hold a hearing, after notifying all parties to the proceeding and any interested persons designated by the court, before appointing a receiver or custodian. The court appointing a receiver or custodian has jurisdiction over the corporation and all of its property wherever located.
(b) The court may appoint an individual or a domestic or foreign corporation authorized to transact business in this state as a receiver or custodian. The court may require the receiver or custodian to post bond, with or without sureties, in an amount the court directs.
(c) The court shall describe the powers and duties of the receiver or custodian in its appointing order, which may be amended from time to time. Among other powers: (1) The receiver (A) may dispose of all or any part of the assets of the corporation wherever located, at a public or private sale, if authorized by the court, and (B) may sue and defend in his own name as receiver of the corporation in all courts of this state; (2) the custodian may exercise all of the powers of the corporation, through or in place of its board of directors or officers, to the extent necessary to manage the affairs of the corporation in the best interests of its shareholders and creditors.
(d) The court during a receivership may redesignate the receiver a custodian, and during a custodianship may redesignate the custodian a receiver, if doing so is in the best interests of the corporation, its shareholders and creditors.
(e) The court from time to time during the receivership or custodianship may order compensation paid and expenses paid or reimbursed to the receiver or custodian from the assets of the corporation or proceeds from the sale of the assets.
(P.A. 94-186, S. 175, 215; P.A. 09-55, S. 25.)
History: P.A. 94-186 effective January 1, 1997; P.A. 09-55 amended Subsec. (a) to add “Unless an election to purchase has been filed under section 33-900” and provide that court has “jurisdiction” over the corporation and its property, rather than “exclusive jurisdiction”, and amended Subsec. (e) to authorize court to order “expenses paid or reimbursed to the receiver or custodian” rather than “expense disbursements or reimbursements made to the receiver or custodian and his counsel”.
Sec. 33-899. Decree of dissolution. (a) If after a hearing the court determines that one or more grounds for judicial dissolution described in section 33-896 exist, it may enter a decree dissolving the corporation and specifying the effective date of the dissolution, and the clerk of the court shall deliver a certified copy of the decree to the Secretary of the State, who shall file it.
(b) After entering the decree of dissolution, the court shall direct the winding up and liquidation of the corporation’s business and affairs in accordance with section 33-884 and the notification of claimants in accordance with sections 33-886 and 33-887.
(P.A. 94-186, S. 176, 215; P.A. 96-271, S. 127, 254; P.A. 09-55, S. 26.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to provide that the entry of a decree dissolving the corporation is discretionary in the case of the grounds specified in Subsec. (a) of Sec. 33-896 and mandatory in the case of the grounds specified in Subsec. (b) of Sec. 33-896, effective January 1, 1997; P.A. 09-55 amended Subsec. (a) to delete provision re grounds specified in Sec. 33-896(a) and (b) dissolution.
Where there is a continuing failure to hold annual meetings, and there appears to be no chance of breaking the deadlock between the parties, it is proper to dissolve the corporation. 55 CA 272.
Sec. 33-900. Election to purchase in lieu of dissolution. (a) In a proceeding under subdivision (1) of subsection (a) of section 33-896 to dissolve a corporation, the corporation may elect or, if it fails to elect, one or more shareholders may elect to purchase all shares owned by the petitioning shareholder at the fair value of the shares. An election pursuant to this section shall be irrevocable unless the court determines that it is equitable to set aside or modify the election.
(b) An election to purchase pursuant to this section may be filed with the court at any time within ninety days after the filing of the petition under subdivision (1) of subsection (a) of section 33-896 or at such later time as the court in its discretion may allow. If the election to purchase is filed by one or more shareholders, the corporation shall, within ten days thereafter, give written notice to all shareholders, other than the petitioner. The notice must state the name and number of shares owned by the petitioner and the name and number of shares owned by each electing shareholder and must advise the recipients of their right to join in the election to purchase shares in accordance with this section. Shareholders who wish to participate must file notice of their intention to join in the purchase no later than thirty days after the effective date of the notice to them. All shareholders who have filed an election or notice of their intention to participate in the election to purchase thereby become parties to ownership of shares as of the date the first election was filed, unless they otherwise agree or the court otherwise directs. After an election has been filed by the corporation or one or more shareholders, the proceeding under subdivision (1) of subsection (a) of section 33-896 may not be discontinued or settled, nor may the petitioning shareholder sell or otherwise dispose of his shares, unless the court determines that it would be equitable to the corporation and the shareholders, other than the petitioner, to permit such discontinuance, settlement, sale or other disposition.
(c) If, within sixty days of the filing of the first election, 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.
(d) If the parties are unable to reach an agreement as provided for in subsection (c) of this section, the court, upon application of any party, shall stay the proceedings under subdivision (1) of subsection (a) of section 33-896 and determine the fair value of the petitioner’s shares as of the day before the date on which the petition was filed or as of such other date as the court deems appropriate under the circumstances.
(e) Upon determining the fair value of the shares, the court shall enter an order directing the purchase upon such terms and conditions as the court deems appropriate, which may include payment of the purchase price in installments, where necessary in the interests of equity, provision for security to assure payment of the purchase price and any additional costs, fees and expenses as may have been awarded, and, if the shares are to be purchased by shareholders, the allocation of shares among them. In allocating the petitioner’s shares among holders of different classes of shares, the court should attempt to preserve the existing distribution of voting rights among holders of different classes insofar as practicable and may direct that holders of a specific class or classes shall not participate in the purchase. Interest may be allowed at the rate and from the date determined by the court to be equitable, but if the court finds that the refusal of the petitioning shareholder to accept an offer of payment was arbitrary or otherwise not in good faith, no interest shall be allowed. In a proceeding under subdivision (1) of subsection (a) of section 33-896, if the court finds that the petitioning shareholder had probable grounds for relief under said subdivision, it may award to the petitioning shareholder reasonable fees and expenses of counsel and of any experts employed by him.
(f) Upon entry of an order under subsection (c) or (e) of this section, the court shall dismiss the petition to dissolve the corporation under section 33-896, and the petitioning shareholder shall no longer have any rights or status as a shareholder of the corporation, except the right to receive the amounts awarded to him by the order of the court which shall be enforceable in the same manner as any other judgment.
(g) The purchase ordered pursuant to subsection (e) of this section shall be made within ten days after the date the order becomes final unless before that time the corporation files with the court a notice of its intention to adopt a certificate of dissolution pursuant to sections 33-881 and 33-882, which certificate of dissolution must then be adopted and filed within fifty days thereafter. Upon filing of such certificate of dissolution, the corporation shall be dissolved in accordance with the provisions of sections 33-884 to 33-887, inclusive, and the order entered pursuant to subsection (e) of this section shall no longer be of any force or effect, except that the court may award the petitioning shareholder reasonable fees and expenses in accordance with the provisions of the last sentence of subsection (e) of this section and the petitioner may continue to pursue any claims previously asserted on behalf of the corporation.
(h) Any payment by the corporation pursuant to an order under subsection (c) or (e) of this section, other than an award of fees and expenses pursuant to subsection (e) of this section, is subject to the provisions of section 33-687.
(P.A. 94-186, S. 177, 215; P.A. 96-271, S. 128, 254; P.A. 97-246, S. 28, 99; June Sp. Sess. P.A. 98-1, S. 118, 121; P.A. 06-68, S. 14; P.A. 09-55, S. 27.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 corrected statutory reference by replacing “subdivision (2) of section 33-896” with “subdivision (1) of subsection (a) of section 33-896” where appearing and amended Subsec. (g) to replace “articles” of dissolution with “certificate” of dissolution where appearing, effective January 1, 1997; P.A. 97-246 amended Subsec. (e) to make a technical change, effective June 27, 1997; June Sp. Sess. P.A. 98-1 amended Subsec. (a) to specify that the proceeding is a proceeding “by a shareholder” and to include a proceeding under Sec. 33-896(a)(2), amended Subsecs. (b) and (d) to include a proceeding under Sec. 33-896(a)(2) and amended Subsec. (e) to rephrase provision re the award of fees and expenses of counsel and of experts, effective June 24, 1998; P.A. 06-68 amended Subsec. (a) by deleting “by a shareholder” and reference to Sec. 33-896(b)(2) and replacing “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” with “is not a public corporation”; P.A. 09-55 amended Subsec. (a) to delete provision making section applicable only to corporation “that is not a public corporation” and amended Subsecs. (b) and (d) to delete references to petition or proceeding under Sec. 33-896(b)(2).
Secs. 33-901 and 33-902. Reserved for future use.
(D)
MISCELLANEOUS PROVISIONS
Sec. 33-903. Deposit of assets with State Treasurer or other state official. Assets of a dissolved corporation that should be transferred to a creditor, claimant or shareholder of the corporation who cannot be found or who is not competent to receive them shall be reduced to cash and deposited for safekeeping with the State Treasurer or other state official authorized to hold such assets. When the creditor, claimant or shareholder furnishes satisfactory proof of entitlement to the amount deposited, the State Treasurer or such other state official shall pay him or his representative that amount.
(P.A. 94-186, S. 178, 215; P.A. 96-271, S. 129, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “other appropriate state official” with “other state official authorized to hold such assets” and made corresponding technical changes, effective January 1, 1997.
Secs. 33-904 to 33-909. Reserved for future use.
PART XV
SPECIALLY CHARTERED CORPORATIONS
Sec. 33-910. Provisions applicable to specially chartered corporations. (a) Except as otherwise provided in sections 33-910 to 33-914, inclusive, all provisions of sections 33-600 to 33-998, inclusive, shall govern and apply to specially chartered corporations formed before or after January 1, 1997, without need for acceptance thereby.
(b) If the certificate of incorporation as in effect on January 1, 1997, of a specially chartered corporation contains any provision contrary to or inconsistent with or in addition to any provision of sections 33-600 to 33-998, inclusive, including this section, the provision contained in such certificate of incorporation shall govern such corporation, and the provisions of said sections shall not be held or construed to alter or affect any provision of the certificate of incorporation of a specially chartered corporation inconsistent herewith except as provided in sections 33-890, 33-912, 33-953 and 33-954.
(P.A. 94-186, S. 179, 215; P.A. 96-271, S. 130, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Sec. 33-911. Formation of specially chartered corporation. Formation of a specially chartered corporation shall, following enactment of its special charter act, be completed in all respects in the same manner as formation of a corporation organized under sections 33-600 to 33-998, inclusive, except that: (1) The incorporators shall be such as are named in such act, if any; (2) no certificate of incorporation shall be filed but in lieu thereof a copy of the special act shall be filed as provided in the case of a certificate of incorporation; and (3) the ninety-day period referred to in subsection (b) of section 33-953 as dating from the filing of the certificate of incorporation shall commence with the date of enactment of the special act.
(P.A. 94-186, S. 180, 215; P.A. 96-271, S. 131, 254; P.A. 19-40, S. 16.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and replaced “one-year” with “thirty-day” in Subdiv. (3), effective January 1, 1997; P.A. 19-40 amended Subdiv. (3) by replacing reference to 30-day period with reference to 90-day period, effective January 1, 2020.
Sec. 33-912. Amendment of special charter. (a) Amendment of a special charter by the General Assembly shall require acceptance by the corporation if and to the extent provided in the act of amendment.
(b) The certificate of incorporation of a specially chartered corporation may be amended by its shareholders for the purposes and in the manner provided by sections 33-600 to 33-998, inclusive, for corporations incorporated under said sections except that its certificate of incorporation as so amended shall not authorize it to engage in any business or to carry on its business in any area unless either (1) it could be so authorized under section 33-645, or (2) it was so authorized by its certificate of incorporation prior to such amendment. A specially chartered corporation the name of which does not contain the words “corporation” or “company” or “incorporated” or “limited” or “Societa per Azioni” or an abbreviation of one of such words may amend its certificate of incorporation pursuant to this subsection without changing its name.
(c) A restated certificate of incorporation adopted by a specially chartered corporation need not, in order to preserve the provisions of special acts of the legislature setting forth its franchises, whether of a public or a private nature, the nature of its business, and its special rights, privileges and immunities, recite such provisions.
(P.A. 94-186, S. 181, 215; P.A. 96-271, S. 132, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and amended Subsec. (b) to add “Societa per Azioni”, effective January 1, 1997.
Sec. 33-913. Surrender of charter and reincorporation. (a) Any specially chartered corporation may surrender its charter and reincorporate under sections 33-600 to 33-998, inclusive, in the manner provided in this section, provided its certificate of incorporation upon effecting reincorporation shall contain only such provisions as might be lawfully contained in a certificate of incorporation under said sections at the time of effecting reincorporation.
(b) The shareholders shall adopt a resolution to such effect and a certificate of incorporation complying with sections 33-600 to 33-998, inclusive, both in the manner provided by section 33-797 in the case of an amendment by shareholders, except that the affirmative vote required shall be at least a majority of the voting power of the outstanding shares of each class.
(c) A certificate setting forth such resolution and a certificate of incorporation, and citing the act of the legislature by or under which such corporation was created, shall be executed and filed as provided in section 33-797 in the case of an amendment by shareholders.
(d) Reincorporation shall take effect as provided in section 33-637. Upon the effectiveness of such reincorporation, the corporation shall cease to be a specially chartered corporation, shall continue its corporate existence under sections 33-600 to 33-998, inclusive, and shall in all respects be subject to and have the benefits of said sections.
(P.A. 94-186, S. 182, 215; P.A. 96-271, S. 133, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “articles” of incorporation with “certificate” of incorporation where appearing and made a technical change, effective January 1, 1997.
Sec. 33-914. Franchise tax. (a) Specially chartered corporations formed after January 1, 1961, shall pay franchise tax as provided in section 33-618.
(b) A specially chartered corporation in existence on January 1, 1961, shall, in respect of the number of shares which it is authorized by shareholders to issue but has not been issued at said date, continue to pay franchise tax under and in accordance with franchise tax provisions in effect and applicable to such corporations on said date.
(c) Together with its payment of franchise tax next following January 1, 1961, each specially chartered corporation in existence on said date shall file with the Secretary of the State a statement, executed as provided in section 33-608, of the number of shares which it was authorized by shareholders to issue but had not issued by January 1, 1961. Whenever shareholders of such a corporation shall increase the number of shares authorized to be issued over the number set forth in such statement, the corporation shall file an amended statement, so executed, setting forth such increase and such corporation shall be subject to the provisions of section 33-618 as in the case of an increase of authorized shares by amendment of the certificate of incorporation. If the certificate of incorporation of such a corporation shall, by special act or by amendment by shareholders, be amended to provide for a designated number of authorized shares, which number is an increase over the number of authorized shares set forth in the latest statement filed pursuant to this subsection, such increase shall be subject to the provisions of section 33-618 and thereafter such corporation shall be subject to said section and to this subsection.
(P.A. 94-186, S. 183, 215; P.A. 96-271, S. 134, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (c) to replace references to “January 1, 1997” with “January 1, 1961” and “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997.
Secs. 33-915 to 33-919. Reserved for future use.
PART XVI
FOREIGN CORPORATIONS
(A)
CERTIFICATE OF AUTHORITY
Sec. 33-920. Authority to transact business required. (a) A foreign corporation, other than an insurance, surety or indemnity company, may not transact business in this state until it obtains a certificate of authority from the Secretary of the State. No foreign corporation engaged in the business of a gas, electric distribution or water company, or cemetery corporation, or of any company requiring the right to take and condemn lands or to occupy the public highways of this state, and no foreign telephone company, shall transact in this state the business authorized by its certificate of incorporation or by the laws of the state under which it was organized, unless empowered so to do by some general or special act of this state, except for the purpose of carrying out and renewing contracts existing upon August 1, 1903. No insurance, surety or indemnity company shall transact business in this state until it has procured a license from the Insurance Commissioner in accordance with the provisions of section 38a-41.
(b) The following activities, among others, do not constitute transacting business within the meaning of subsection (a) of this section: (1) Maintaining, defending or settling any proceeding; (2) holding meetings of the board of directors or shareholders or carrying on other activities concerning internal corporate affairs; (3) maintaining bank accounts; (4) maintaining offices or agencies for the transfer, exchange and registration of the corporation’s own securities or maintaining trustees or depositaries with respect to those securities; (5) selling through independent contractors; (6) soliciting or obtaining orders, whether by mail or through employees or agents or otherwise, if the orders require acceptance outside this state before they become contracts; (7) creating or acquiring indebtedness, mortgages and security interests in real or personal property; (8) securing or collecting debts or enforcing mortgages and security interests in property securing the debts; (9) owning, without more, real or personal property; (10) conducting an isolated transaction that is completed within thirty days and that is not one in the course of repeated transactions of a like nature; (11) transacting business in interstate commerce.
(c) The list of activities in subsection (b) of this section is not exhaustive.
(P.A. 94-186, S. 184, 215; P.A. 97-246, S. 29, 99; P.A. 98-28, S. 108, 117; P.A. 14-134, S. 39.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to exempt an insurance, surety or indemnity company from the prohibition on a foreign corporation transacting business in this state until it obtains a certificate of authority from the Secretary of the State, effective June 27, 1997; P.A. 98-28 amended Subsec. (a) by adding electric distribution companies, effective July 1, 1998; P.A. 14-134 amended Subsec. (a) by deleting references to telegraph company and electric company, effective June 6, 2014.
Sec. 33-921. Consequences of transacting business without authority. (a) A foreign corporation transacting business in this state without a certificate of authority may not maintain a proceeding in any court in this state until it obtains a certificate of authority.
(b) The successor to a foreign corporation that transacted business in this state without a certificate of authority and the assignee of a cause of action arising out of that business may not maintain a proceeding based on that cause of action in any court in this state until the foreign corporation or its successor obtains a certificate of authority.
(c) A court may stay a proceeding commenced by a foreign corporation, its successor, or assignee until it determines whether the foreign corporation or its successor requires a certificate of authority. If it so determines, the court may further stay the proceeding until the foreign corporation or its successor obtains the certificate.
(d) A foreign corporation is liable to this state, for the years or parts thereof during which it transacted business in this state without a certificate of authority, in an amount equal to (1) all fees and taxes which would have been imposed by law upon such corporation had it duly applied for and received such certificate of authority to transact business in this state, and (2) all interest and penalties imposed by law for failure to pay such fees and taxes. A foreign corporation is further liable to this state, for each month or part thereof during which it transacted business without a certificate of authority, in an amount equal to three hundred dollars, except that a foreign corporation which has obtained a certificate of authority not later than ninety days after it has commenced transacting business in this state shall not be liable for such monthly penalty. Such fees and penalties may be levied by the Secretary of the State. The Attorney General shall bring such action as he may deem necessary to recover any amounts due the state under the provisions of this subsection including an action to restrain a foreign corporation against which fees and penalties have been imposed pursuant to this subsection from transacting business in this state until such time as such fees and penalties have been paid.
(e) Notwithstanding subsections (a) and (b) of this section, the failure of a foreign corporation to obtain a certificate of authority does not impair the validity of its corporate acts or prevent it from defending any proceeding in this state.
(P.A. 94-186, S. 185, 215; P.A. 97-228, S. 1, 7; P.A. 98-137, S. 13, 62; 98-219, S. 33, 34; P.A. 09-83, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-228 deleted Subsec. (d)(3) re penalty of $2,000 for each year or part thereof during which a foreign corporation transacts business without a certificate of authority, replacing said annual penalty with a penalty of $165 for each month or part thereof that a foreign corporation transacts business without a certificate of authority and rephrasing provision re grace period, effective July 1, 1997; P.A. 98-137 amended Subsec. (d) to revise grace period by providing that a corporation is not liable for the monthly penalty if it has obtained a certificate of authority “not later than ninety days after it has commenced transacting” business in this state rather than not being liable “for the first three months or part thereof during which it transacted business without such certificate”, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 09-83 amended Subsec. (d) to increase penalty from $165 to $300 for each month or part thereof that a foreign corporation transacts business without a certificate of authority and to make a technical change.
Foreign corporation that sought to recover credit card debt from consumer and that did not have a physical presence or employees in this state was “transacting business in interstate commerce” under Sec. 33-920(b)(11), and was not prohibited from maintaining action for failure to obtain a certificate of authority. 128 CA 843.
Sec. 33-921a. Limited amnesty for foreign corporation transacting business without authority. Notwithstanding any provision of sections 33-600 to 33-998, inclusive, any foreign corporation transacting business in this state without a certificate of authority that voluntarily comes forward during the period commencing July 1, 2001, and ending July 1, 2002, to obtain a certificate of authority shall not be liable for the monthly penalty that would otherwise be imposed pursuant to subsection (d) of section 33-921. The amnesty provided by this section shall not apply to any other fees, taxes or penalties owed by a foreign corporation or any interest thereon.
(P.A. 01-81, S. 2, 3.)
History: P.A. 01-81 effective July 1, 2001.
Sec. 33-922. Application for certificate of authority. (a) A foreign corporation may apply for a certificate of authority to transact business in this state by delivering an application to the Secretary of the State for filing. The application shall set forth: (1) The name of the foreign corporation or, if its name is unavailable for use in this state, a corporate name that satisfies the requirements of section 33-925; (2) the name of the state or country under whose law it is incorporated; (3) its date of incorporation and period of duration; (4) the street address of its principal office; (5) the address of its registered office in this state and the name of its registered agent at that office; (6) the electronic mail address, if any, of the corporation; and (7) the names and respective business and residence addresses of the directors and officers of the foreign corporation, except that if good cause is shown, the Secretary of the State may accept business addresses in lieu of business and residence addresses of the directors and officers of the corporation. For purposes of this section, a showing of good cause shall include, but not be limited to, a showing that public disclosure of the residence addresses of the corporation’s directors and officers may expose the personal security of such directors and officers to significant risk.
(b) The foreign corporation shall deliver with the completed application a certificate of existence, or a document of similar import, duly authenticated by the secretary of the state or other official having custody of corporate records in the state or country under whose law it is incorporated.
(P.A. 94-186, S. 186, 215; P.A. 97-246, S. 30, 99; P.A. 98-137, S. 14, 62; 98-219, S. 33, 34; P.A. 14-154, S. 3.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a)(6) to replace requirement that application set forth the “business addresses or, if there is no business address for any such person, the residence address, of its current directors and officers” with provision requiring application to set forth the respective business and residence addresses of the directors and officers but authorizing the Secretary of the State, for good cause, to accept business addresses in lieu of such business and residence addresses, effective June 27, 1997; P.A. 98-137 amended Subsec. (a) to add provision that a showing of good cause includes a showing that public disclosure of the residence addresses of the corporation’s directors and officers may expose the personal security of such directors and officers to significant risk, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 14-154 amended Subsec. (a) to add new Subdiv. (6) re electronic mail address of corporation and redesignate existing Subdiv. (6) as Subdiv. (7), effective January 1, 2015.
Sec. 33-923. Amended certificate of authority. (a) A foreign corporation authorized to transact business in this state must obtain an amended certificate of authority from the Secretary of the State if it changes: (1) Its corporate name; (2) the period of its duration; or (3) the state or country of its incorporation.
(b) The requirements of section 33-922 for obtaining an original certificate of authority apply to obtaining an amended certificate under this section.
(P.A. 94-186, S. 187, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-924. Effect of certificate of authority. (a) A certificate of authority authorizes the foreign corporation to which it is issued to transact business in this state subject, however, to the right of the state to revoke the certificate as provided in sections 33-600 to 33-998, inclusive.
(b) A foreign corporation with a valid certificate of authority has the same but no greater rights and has the same but no greater privileges as, and except as otherwise provided by sections 33-600 to 33-998, inclusive, is subject to the same duties, restrictions, penalties and liabilities imposed on, a domestic corporation of like character.
(c) Sections 33-600 to 33-998, inclusive, do not authorize this state to regulate the organization or internal affairs of a foreign corporation authorized to transact business in this state.
(P.A. 94-186, S. 188, 215; P.A. 96-271, S. 135, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to make a technical change, effective January 1, 1997.
Sec. 33-925. Corporate name of foreign corporation. (a) The corporate name of a foreign corporation must satisfy the requirements of section 33-665. If the corporate name of a foreign corporation does not satisfy the requirements of section 33-655, the foreign corporation in order to satisfy the requirements of said section and obtain or maintain a certificate of authority to transact business in this state: (1) May add the word “corporation”, “incorporated”, “company”, “Societa per Azioni” or “limited”, or the abbreviation “corp.”, “inc.”, “co.”, “S.p.A.” or “ltd.”, to its corporate name for use in this state; or (2) may use a fictitious name which includes the word “corporation”, “incorporated”, “company”, “Societa per Azioni” or “limited” or the abbreviations “corp.”, “inc.”, “co.”, “S.p.A.” or “ltd.” to transact business in this state if its real name is unavailable and it includes with its application for a certificate of authority a copy of the resolution of its board of directors, certified by its secretary, adopting the fictitious name.
(b) Except as authorized by subsections (c) and (d) of this section, the corporate name, including a fictitious name, of a foreign corporation must be distinguishable upon the records of the Secretary of the State from: (1) The corporate name of a corporation incorporated or authorized to transact business in this state; (2) a corporate name reserved or registered under section 33-656 or 33-657; (3) the fictitious name adopted by another foreign corporation authorized to transact business in this state because its real name is unavailable; (4) the corporate name of a nonprofit corporation incorporated or authorized to transact business in this state; (5) the corporate name of any domestic or foreign nonstock corporation incorporated or authorized to transact business in this state; (6) the name of any domestic or foreign limited partnership organized or authorized to transact business in this state; (7) the name of any domestic or foreign limited liability company organized or authorized to transact business in this state; (8) the name of any domestic or foreign limited liability partnership organized or authorized to transact business in this state; and (9) the name of any other entity whose name is carried upon the records of the Secretary of the State as organized or authorized to transact business in this state.
(c) A foreign corporation may apply to the Secretary of the State for authorization to use in this state a name that is not distinguishable upon his records from one or more of the names described in subsection (b) of this section. The Secretary of the State shall authorize use of the name applied for if: (1) The other corporation, limited partnership, limited liability company, limited liability partnership or other entity consents to the use in writing and submits an undertaking in form satisfactory to the Secretary of the State to change its name to a name that is distinguishable upon the records of the Secretary of the State from the name of the applying corporation; or (2) the applicant delivers to the Secretary of the State a certified copy of a final judgment of a court of competent jurisdiction establishing the applicant’s right to use the name applied for in this state.
(d) A foreign corporation may use in this state the name, including the fictitious name, of another entity that is used in this state if the other entity is organized or authorized to transact business in this state and the foreign corporation: (1) Has merged with the other entity; or (2) has been formed by reorganization of the other entity.
(e) If a foreign corporation authorized to transact business in this state changes its corporate name to one that does not satisfy the requirements of section 33-655, it may not transact business in this state under the changed name until it adopts a name satisfying the requirements of said section and obtains an amended certificate of authority under section 33-923.
(P.A. 94-186, S. 189, 215; P.A. 96-271, S. 136–138, 254; P.A. 97-246, S. 31, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to replace in Subdiv. (3) “the fictitious name of another foreign corporation authorized to transact business in this state” with “the fictitious name adopted by another foreign corporation authorized to transact business in this state because its real name is unavailable”, replace in Subdiv. (4) “not-for-profit” with “nonprofit”, add Subdiv. (5) re corporate name of any nonstock corporation, add Subdiv. (6) re name of any limited partnership, add Subdiv. (7) re name of any limited liability company, add Subdiv. (8) re name of any limited liability partnership and add Subdiv. (9) re name of any other entity whose name is carried upon the records of the Secretary of the State as organized or authorized to transact business in this state, amended Subsec. (c) to permit a foreign corporation to apply to use “a name that is not distinguishable upon his records from one or more of the names described in subsection (b) of this section” rather than “the name of another incorporation, incorporated or authorized to transact business in this state, that is not distinguishable upon his records from the name applied for” and add in Subdiv. (1) “limited partnership, limited liability company, limited liability partnership or other entity” and amended Subsec. (d) to replace “another domestic or foreign corporation” with “another entity”, “other corporation” with “other entity” and “incorporated” with “organized”, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to require the corporate name of a foreign corporation to satisfy the requirements of Sec. 33-655 and require a fictitious name to include the word “corporation”, “incorporated”, “company”, “Societa per Azioni” or “limited” or the abbreviation “corp.”, “inc.”, “co.”, “S.p.A.” or “ltd.”, effective June 27, 1997.
Sec. 33-926. Registered office and registered agent of foreign corporation. (a) Each foreign corporation authorized to transact business in this state shall continuously maintain in this state: (1) A registered office that may be the same as any of its places of business; and (2) a registered agent at such registered office, who may be: (A) A natural person who is a resident of this state; (B) a domestic corporation; (C) a foreign corporation which has procured a certificate of authority to transact business or conduct its affairs in this state; (D) a domestic limited liability company; (E) a limited liability company not organized under the laws of this state and which has procured a certificate of registration to transact business or conduct its affairs in this state; (F) a domestic registered limited liability partnership; (G) a registered limited liability partnership not organized under the laws of this state and which has procured a certificate of authority to transact business or conduct its affairs in this state; (H) a domestic statutory trust; or (I) a statutory trust not organized under the laws of this state and which has procured a certificate of registration to transact business or conduct its affairs in this state. The appointment of such registered agent shall be in writing and shall be signed by the registered agent therein appointed. If a natural person is appointed as the registered agent, such appointment shall include the residence address of such person.
(b) In addition to persons or entities who may act as a registered agent pursuant to subsection (a) of this section, a foreign corporation may appoint the Secretary of the State and his successors in office to act as its registered agent.
(P.A. 94-186, S. 190, 215; P.A. 96-271, S. 139, 254; P.A. 97-246, S. 32, 99; P.A. 04-240, S. 3.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 designated existing provisions as Subsec. (a) and amended said Subsec. to replace in Subdiv. (2)(A) “An individual who resides in this state and whose business office is identical with the registered office” with “A natural person who is a resident of this state”, delete in Subdiv. (2)(B) “or not-for-profit domestic corporation whose business office is identical with the registered office” and replace in Subdiv. (2)(C) “a foreign corporation or foreign not-for-profit corporation authorized to transact business in this state whose business office is identical with the registered office” with “a corporation not organized under the laws of this state and which has procured a certificate of authority to transact business in this state” and added Subsec. (b) to authorize a foreign corporation to appoint the Secretary of the State or his successor in office as its registered agent, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to require the corporation to maintain a registered agent “at such registered office” and amended Subsec. (b) to make a technical change, effective June 27, 1997; P.A. 04-240 added Subsec. (a)(2)(D) to (I) re limited liability companies, registered limited liability partnerships and statutory trusts as registered agents, added provisions re appointment of registered agent in writing signed by the agent and re inclusion of residence address in appointment of natural person and made technical changes.
When a foreign corporation is authorized to conduct business in this state and appoints a registered agent under section, it has consented to the exercise of jurisdiction over it by the courts of the state, and nothing in Sec. 33-929(f) limits a court’s exercise of personal jurisdiction. 113 CA 845.
Sec. 33-927. Change of registered office or registered agent of foreign corporation. (a) A foreign corporation authorized to transact business in this state may change its registered office or registered agent by delivering to the Secretary of the State for filing a statement of change that sets forth: (1) Its name; (2) if the current registered office is to be changed, the street address of its current registered office and the street address of its new registered office; and (3) if the current registered agent is to be changed, the name of its current registered agent and the name of its new registered agent and the new agent’s written consent, either on the statement or attached to it, to the appointment.
(b) If a registered agent changes the street address of his business office, he may change the street address of the registered office of any foreign corporation for which he is the registered agent by notifying the corporation in writing of the change and signing and delivering to the Secretary of the State for filing a statement of change that complies with the requirements of subsection (a) of this section and recites that the corporation has been notified of the change.
(P.A. 94-186, S. 191, 215; P.A. 97-246, S. 33, 99; P.A. 11-147, S. 23.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to combine former Subdivs. (2) and (3) into Subdiv. (2), thereby providing that the statement must set forth the street address of the current registered office only if the current registered office is to be changed, combine former Subdivs. (4) and (5) into new Subdiv. (3), thereby providing that the statement must set forth the name of the current registered agent only if the current registered agent is to be changed, and delete former Subdiv. (6) that had required the statement to set forth that, after the change or changes are made, the street addresses of its registered office and the business office of its registered agent will be identical, effective June 27, 1997; P.A. 11-147 amended Subsec. (b) to delete provision re agent signing statement “either manually or in facsimile”.
Sec. 33-928. Resignation of registered agent of foreign corporation. (a) The registered agent of a foreign corporation may resign his agency appointment by signing and delivering to the Secretary of the State for filing the original and one exact or conformed copy of a statement of resignation. The statement of resignation may include a statement that the registered office is also discontinued.
(b) After filing the statement, the Secretary of the State shall mail the copy to the foreign corporation at its principal office address shown in its most recent annual report.
(c) The agency appointment is terminated, and the registered office discontinued if so provided, on the thirty-first day after the date on which the statement was filed.
(P.A. 94-186, S. 192, 215; P.A. 97-246, S. 34, 35, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to reduce from two to one the number of copies of the statement of resignation that must be delivered to the Secretary of the State and amended Subsec. (b) to delete the requirement that the Secretary of the State attach the filing receipt to one copy and mail that copy and the receipt to the registered office if not discontinued, effective June 27, 1997.
Sec. 33-929. Service of process on foreign corporation. (a) The registered agent of a foreign corporation authorized to transact business in this state is the corporation’s agent for service of process, notice or demand required or permitted by law to be served on the foreign corporation. When the registered agent is other than the Secretary of the State and his successors in office, service may be effected by any proper officer or other person lawfully empowered to make service by leaving a true and attested copy of the process, notice or demand with such agent or, in the case of an agent who is a natural person, by leaving it at such agent’s usual place of abode in this state.
(b) A foreign corporation may be served by any proper officer or other person lawfully empowered to make service by registered or certified mail, return receipt requested, addressed to the secretary of the foreign corporation at its principal office shown in its application for a certificate of authority or in its most recent annual report if the foreign corporation: (1) Has no registered agent or its registered agent cannot with reasonable diligence be served; (2) has withdrawn from transacting business in this state under section 33-932; or (3) has had its certificate of authority revoked under section 33-936.
(c) When the Secretary of the State and his successors in office have been appointed a foreign corporation’s registered agent, a foreign corporation may be served by any proper officer or other person lawfully empowered to make service by leaving two true and attested copies thereof together with the required fee at the office of the Secretary of the State or depositing the same in the United States mail, by registered or certified mail, postage prepaid, addressed to said office. The Secretary of the State shall file one copy of such process and keep a record of the date and hour of such receipt. He shall, within two business days after such service, forward by registered or certified mail the copy of such process to the corporation at the address of its principal office as last shown on his records.
(d) Service is effective under subsection (b) of this section at the earliest of: (1) The date the foreign corporation receives the mail; (2) the date shown on the return receipt, if signed on behalf of the foreign corporation; and (3) five days after its deposit in the United States mail, as evidenced by the postmark, if mailed postage prepaid and correctly addressed. In the case of service on the Secretary of the State, service so made shall be effective as of the date and hour received by the Secretary of the State as shown on his records.
(e) Every foreign corporation which transacts business in this state in violation of section 33-920 shall be subject to suit in this state upon any cause of action arising out of such business.
(f) Every foreign corporation shall be subject to suit in this state, by a resident of this state or by a person having a usual place of business in this state, whether or not such foreign corporation is transacting or has transacted business in this state and whether or not it is engaged exclusively in interstate or foreign commerce, on any cause of action arising as follows: (1) Out of any contract made in this state or to be performed in this state; (2) out of any business solicited in this state by mail or otherwise if the corporation has repeatedly so solicited business, whether the orders or offers relating thereto were accepted within or without the state; (3) out of the production, manufacture or distribution of goods by such corporation with the reasonable expectation that such goods are to be used or consumed in this state and are so used or consumed, regardless of how or where the goods were produced, manufactured, marketed or sold or whether or not through the medium of independent contractors or dealers; or (4) out of tortious conduct in this state, whether arising out of repeated activity or single acts, and whether arising out of misfeasance or nonfeasance.
(g) In any action brought under subsection (e) or (f) of this section, or in any foreclosure or other action involving real property located in this state in which a foreign corporation, although not transacting business in this state, owns or claims to own an interest, service of process on such corporation may be made as provided in subsection (b) of this section, except that the service shall be addressed to the corporation at its principal office or, if it has no such office or the address of such office is not known, to such corporation’s last office as shown in the official registry of the state or country of its incorporation, which address shall be set forth in the writ or other process.
(h) This section does not prescribe the only means, or necessarily the required means, of serving a foreign corporation.
(P.A. 94-186, S. 193, 215; P.A. 96-271, S. 140, 141, 254; P.A. 97-246, S. 36, 99; June Sp. Sess. P.A. 98-1, S. 23, 121.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to add provision authorizing service to be effected by leaving a copy with the agent or, in the case of an agent who is a natural person, at the agent’s usual place of abode and amended Subsec. (c) to make technical changes, effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to provide that the manner of service specified is applicable when the registered agent is other than the Secretary of the State and his successors in office and authorize service by any proper officer or other person lawfully empowered to make service, amended Subsec. (b) to authorize service by any proper officer or other person lawfully empowered to make service, designated as Subsec. (c) provisions formerly part of Subsec. (b) re manner of service when the Secretary of the State has been appointed registered agent and amended said Subsec. to delete provision that limited applicability to service of foreign corporations authorized to transact business in this state, replace “executive offices” with “principal office” and make technical changes, redesignated former Subsec. (c) as Subsec. (d) and amended said Subsec. to make provision re effective date and time of service on the Secretary of the State a separate sentence rather than Subdiv. (4) and make technical changes, redesignated former Subsecs. (d) and (e) as Subsecs. (e) and (f), respectively, added new Subsec. (g) re the manner of service in an action under Subsec. (e) or (f) or in certain actions involving real property and redesignated former Subsec. (f) as Subsec. (h), effective June 27, 1997; June Sp. Sess. P.A. 98-1 made a technical change in Subsec. (c), effective June 24, 1998.
See Sec. 1-2a re construction of references to “United States mail”, “postmark” or “registered or certified mail”.
Subsec. (f):
Subdiv. (1): “To be performed” refers to the performance that the parties to the contract contemplated in the contract, without regard to whether such performance has actually been performed. 329 C. 249.
Allegation of negligent misrepresentation qualifies as tortious conduct under Subdiv. (4), but plaintiff failed to present facts sufficient to establish trial court’s jurisdiction. 54 CA 506. Foreign corporation may be subject to suit in this state on a cause of action arising out of business solicited in this state or out of tortious conduct in this state; third party complaint against foreign corporation that contained only one conclusory allegation of jurisdictional fact properly dismissed for lack of personal jurisdiction because it failed to satisfy burden of establishing that court had personal jurisdiction over foreign corporation. 70 CA 309. When a foreign corporation is authorized to conduct business in this state and appoints a registered agent under Sec. 33-926, it has consented to the exercise of jurisdiction over it by the courts of the state, and nothing in Subsec. limits a court’s exercise of personal jurisdiction. 113 CA 845. To empower plaintiff to sue a foreign corporation under the usual place of business prong, this state need not be plaintiff’s primary or sole place of business but it must, at the very least, be customary or expected that plaintiff conducts business here; the general long arm jurisdiction provisions of Sec. 52-59b, rather than the corporation specific provisions of Subsec., apply to foreign limited liability companies. 149 CA 513. Because Rhode Island town is not a foreign corporation within the meaning of our general statutes, Subsec. does not confer personal jurisdiction over the town. 192 CA 759.
Corporate defendant’s motion to dismiss for lack of personal jurisdiction denied where trial court concluded that defendant provided plaintiffs with employment packets that specified the terms and conditions of employment and defendant had a continuing obligation to ensure that plaintiffs were paid in full compliance with state’s minimum wage law. 49 CS 441.
Secs. 33-930 and 33-931. Reserved for future use.
(B)
WITHDRAWAL
Sec. 33-932. Withdrawal of foreign corporation. (a) A foreign corporation authorized to transact business in this state may not withdraw from this state until it obtains a certificate of withdrawal from the Secretary of the State.
(b) A foreign corporation authorized to transact business in this state may apply for a certificate of withdrawal by delivering an application to the Secretary of the State for filing. The application shall set forth: (1) The name of the foreign corporation and the name of the state or country under whose law it is incorporated; (2) that it is not transacting business in this state and that it surrenders its authority to transact business in this state; (3) that it revokes the authority of its registered agent to accept service on its behalf and appoints the Secretary of the State and his successors in office as its agent for service of process in any proceeding based on a cause of action arising during the time it was authorized to transact business in this state; (4) a mailing address to which the Secretary of the State may mail a copy of any process served on him under subdivision (3) of this subsection; and (5) a commitment to notify the Secretary of the State in the future of any change in its mailing address.
(c) After the withdrawal of the corporation is effective, service of process on the Secretary of the State as provided in section 33-929 is service on the foreign corporation.
(P.A. 94-186, S. 194, 215; P.A. 97-246, S. 37, 38, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (b) to provide in Subdiv. (3) that the appointment is of the Secretary of the State “and his successors in office” and amended Subsec. (c) to provide that service on the Secretary of the State is made “as provided in Sec. 33-929” rather than “under this section” and delete provision that required the Secretary of the State to mail a copy of the process to the foreign corporation, effective June 27, 1997.
Secs. 33-933 and 33-934. Reserved for future use.
(C)
REVOCATION OF CERTIFICATE OF AUTHORITY
Sec. 33-935. Grounds for revocation. The Secretary of the State may commence a proceeding under section 33-936 to revoke the certificate of authority of a foreign corporation authorized to transact business in this state if: (1) The foreign corporation has failed to file its annual report with the Secretary of the State; (2) the foreign corporation does not pay within sixty days after they are due any license fees, franchise taxes or penalties imposed by sections 33-600 to 33-998, inclusive, or other law; (3) the foreign corporation is without a registered agent or registered office in this state for sixty days or more; (4) the foreign corporation does not inform the Secretary of the State under section 33-927 or 33-928 that its registered agent or registered office has changed, that its registered agent has resigned or that its registered office has been discontinued within sixty days of the change, resignation or discontinuance; (5) an incorporator, director, officer or agent of the foreign corporation signed a document he knew was false in any material respect with intent that the document be delivered to the Secretary of the State for filing; or (6) the Secretary of the State receives a duly authenticated certificate from the secretary of the state or other official having custody of corporate records in the state or country under whose law the foreign corporation is incorporated stating that it has been dissolved or disappeared as the result of a merger.
(P.A. 94-186, S. 195, 215; P.A. 95-252, S. 31, 36; P.A. 14-154, S. 4.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-252 deleted former Subdiv. (1) that had provided as a ground for the revocation of a certificate of authority the failure of a foreign corporation to deliver its annual report to the Secretary of the State within 60 days after it is due, renumbering the remaining Subdivs. accordingly, effective January 1, 1997; P.A. 14-154 added new Subdiv. (1) re revocation of certificate of authority to transact business due to foreign corporation’s failure to file annual report with Secretary of the State and redesignated existing Subdivs. (1) to (5) as Subdivs. (2) to (6), effective January 1, 2015.
Sec. 33-936. Procedure for and effect of revocation. (a) If the Secretary of the State determines that one or more grounds exist under section 33-935 for revocation of a certificate of authority, he shall notify the foreign corporation by registered or certified mail addressed to such foreign corporation at its principal office as last shown on his records that under the provisions of this section the foreign corporation’s certificate of authority is to be revoked.
(b) If the foreign corporation does not correct each ground for revocation or demonstrate to the reasonable satisfaction of the Secretary of the State that each ground determined by the Secretary of the State does not exist, within ninety days after mailing of the notice, the Secretary of the State may revoke the foreign corporation’s certificate of authority by signing a certificate of revocation that recites the ground or grounds for revocation and its effective date. The Secretary of the State shall file the original of the certificate and shall: (1) Mail a copy thereof to the delinquent corporation, addressed to such corporation at its principal office as last shown on his records; and (2) cause notice of the filing to be posted on the office of the Secretary of the State’s Internet web site for a period of sixty days following the date on which the Secretary of the State files the certificate of revocation.
(c) The authority of a foreign corporation to transact business in this state ceases on the date shown on the certificate revoking its certificate of authority.
(d) The Secretary of the State’s revocation of a foreign corporation’s certificate of authority appoints the Secretary of the State the foreign corporation’s agent for service of process in any proceeding based on a cause of action which arose during the time the foreign corporation was authorized to transact business in this state. Service of process on the Secretary of the State as provided in section 33-929 is service on the foreign corporation.
(e) Revocation of a foreign corporation’s certificate of authority does not terminate the authority of the registered agent of the corporation.
(P.A. 94-186, S. 196, 215; P.A. 96-271, S. 142, 254; P.A. 97-246, S. 39, 87, 99; P.A. 14-154, S. 5.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (d) to require the Secretary of the State to mail a copy of the process to “the foreign corporation” rather than “the secretary of the foreign corporation” and make a technical change, effective January 1, 1997; P.A. 97-246 amended Subsec. (b) to replace “perfected under Sec. 33-929” with “effective under Sec. 33-929” and amended Subsec. (d) to provide that service on the Secretary of the State is made “as provided in Sec. 33-929” rather than “under this section” and delete provision that required the Secretary of the State to mail a copy of the process to the foreign corporation, effective June 27, 1997; P.A. 14-154 amended Subsec. (a) by deleting requirement that Secretary of the State serve written notice to foreign corporation of proposed revocation of certificate of authority and adding requirement that notice be sent by registered or certified mail to foreign corporation at its principal office, and amended Subsec. (b) by extending time period that foreign corporation has to take corrective action from 60 days to 90 days, deleting requirement that certificate of revocation be served on foreign corporation, requiring that certificate of revocation be mailed to corporation at its principal office, requiring Secretary of the State to cause notice of filing of certificate of revocation to be posted on the office’s web site and making conforming changes, effective January 1, 2015.
Sec. 33-937. Appeal from revocation. (a) A foreign corporation may appeal the Secretary of the State’s revocation of its certificate of authority to the Superior Court within thirty days after service of the certificate of revocation is effective under section 33-929. The foreign corporation appeals by petitioning the court to set aside the revocation and attaching to the petition copies of its certificate of authority and the Secretary of the State’s certificate of revocation.
(b) The court may summarily order the Secretary of the State to reinstate the certificate of authority or may take any other action the court considers appropriate.
(c) The court’s final decision may be appealed as in other civil proceedings.
(P.A. 94-186, S. 197, 215; P.A. 97-246, S. 88, 99.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (a) to replace “perfected” with “effective”, effective June 27, 1997.
Secs. 33-938 to 33-944. Reserved for future use.
PART XVII
RECORDS AND REPORTS
(A)
RECORDS
Sec. 33-945. Corporate records. (a) A corporation shall keep as permanent records minutes of all meetings of its shareholders and board of directors, a record of all actions taken by the shareholders or board of directors without a meeting and a record of all actions taken by a committee of the board of directors in place of the board of directors on behalf of the corporation.
(b) A corporation shall maintain appropriate accounting records.
(c) A corporation or its agent shall maintain a record of its shareholders, in a form that permits preparation of a list of the names and addresses of all shareholders, in alphabetical order by class of shares showing the number and class of shares held by each.
(d) A corporation shall maintain its records in the form of a document, including an electronic record, or in another form capable of conversion into paper form within a reasonable time.
(e) A corporation shall keep a copy of the following records at its principal office: (1) Its certificate of incorporation or restated certificate of incorporation, all amendments to them currently in effect and any notices to shareholders referred to in subsection (l) of section 33-608 regarding facts on which a document is dependent; (2) its bylaws or restated bylaws and all amendments to them currently in effect; (3) resolutions adopted by its board of directors creating one or more classes or series of shares and fixing their relative rights, preferences and limitations, if shares issued pursuant to those resolutions are outstanding; (4) the minutes of all shareholders’ meetings and records of all action taken by shareholders without a meeting for the past three years; (5) all written communications to shareholders generally within the past three years, including the financial statements furnished for the past three years under section 33-951; (6) a list of the names and business addresses of its current directors and officers; and (7) its most recent annual report delivered to the Secretary of the State under section 33-953.
(P.A. 94-186, S. 198, 215; P.A. 96-271, S. 143, 254; P.A. 03-158, S. 12; P.A. 11-147, S. 24.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (e) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 03-158 amended Subsec. (e)(1) by adding provision re notices to shareholders of facts on which a document is dependent and by making a technical change; P.A. 11-147 amended Subsec. (d) to replace “in written form” with “in the form of a document, including an electronic record” and replace “written form” with “paper form”.
Sec. 33-946. Inspection of records by shareholders. (a) A shareholder of a corporation is entitled to inspect and copy, during regular business hours at the corporation’s principal office, any of the records of the corporation described in subsection (e) of section 33-945 if he gives the corporation a signed written notice of his demand at least five business days before the date on which he wishes to inspect and copy.
(b) For any meeting of shareholders for which the record date for determining shareholders entitled to vote at the meeting is different than the record date for notice of the meeting, any person who becomes a shareholder subsequent to the record date for notice of the meeting and is entitled to vote at the meeting is entitled to obtain from the corporation upon request the notice and any other information provided by the corporation to shareholders in connection with the meeting, unless the corporation has made such information generally available to shareholders by posting it on its web site or by other generally recognized means. Failure of a corporation to provide such information does not affect the validity of action taken at the meeting.
(c) A shareholder of a corporation is entitled to inspect and copy, during regular business hours at a reasonable location specified by the corporation, any of the following records of the corporation if the shareholder meets the requirements of subsection (d) of this section and gives the corporation a signed written notice of his demand at least five business days before the date on which he wishes to inspect and copy: (1) Excerpts from minutes of any meeting of the board of directors or a committee of the board of directors while acting in place of the board of directors on behalf of the corporation, minutes of any meeting of the shareholders and records of action taken by the shareholders, the board of directors or a committee of the board without a meeting, to the extent not subject to inspection under subsection (a) of this section; (2) accounting records of the corporation; and (3) the record of shareholders.
(d) A shareholder may inspect and copy the records described in subsection (c) of this section only if: (1) His demand is made in good faith and for a proper purpose; (2) he describes with reasonable particularity his purpose and the records he desires to inspect; and (3) the records are directly connected with his purpose.
(e) The right of inspection granted by this section may not be abolished or limited by a corporation’s certificate of incorporation or bylaws.
(f) This section does not affect: (1) The right of a shareholder to inspect records under section 33-704 or, if the shareholder is in litigation with the corporation, to the same extent as any other litigant; (2) the power of a court, independently of sections 33-600 to 33-998, inclusive, to compel the production of corporate records for examination.
(g) For purposes of this section, “shareholder” includes a beneficial owner whose shares are held in a voting trust or by a nominee on his behalf.
(P.A. 94-186, S. 199, 215; P.A. 96-271, S. 144, 254; P.A. 11-147, S. 9.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (d) to replace “articles” of incorporation with “certificate” of incorporation, effective January 1, 1997; P.A. 11-147 amended Subsec. (a) to require shareholder to give “a signed” written notice of his demand, added new Subsec. (b) re provision of information to person who becomes shareholder subsequent to record date for notice of the meeting and is entitled to vote at the meeting, redesignated existing Subsec. (b) as Subsec. (c) and amended same to require shareholder to give “a signed” written notice of his demand, reposition language re records of action taken by a committee of the board and make a technical change, redesignated existing Subsec. (c) as Subsec. (d) and amended same to make a technical change and redesignated existing Subsecs. (d) to (f) as Subsecs. (e) to (g).
Cited. 45 CS 101.
Sec. 33-947. Scope of inspection right. (a) A shareholder’s agent or attorney has the same inspection and copying rights as the shareholder represented.
(b) The right to copy records under section 33-946 includes, if reasonable, the right to receive copies by xerographic or other means, including copies through an electronic transmission if available and so requested by the shareholder.
(c) The corporation may comply at its expense with a shareholder’s demand to inspect the record of shareholders under subdivision (3) of subsection (c) of section 33-946 by providing the shareholder with a list of shareholders that was compiled no earlier than the date of the shareholder’s demand.
(d) The corporation may impose a reasonable charge, covering the costs of labor and material, for copies of any documents provided to the shareholder. The charge may not exceed the estimated cost of production, reproduction or transmission of the records.
(P.A. 94-186, S. 200, 215; P.A. 01-199, S. 27; P.A. 11-147, S. 27.)
History: P.A. 94-186 effective January 1, 1997; P.A. 01-199 amended Subsec. (b) to replace “the right to receive copies made by photographic, xerographic or other means” with “the right to receive copies by xerographic or other means, including copies through an electronic transmission if available and so requested by the shareholder”, redesignated former Subsec. (d) as Subsec. (c) and amended to add “at its expense”, redesignated former Subsec. (c) as Subsec. (d) and amended to include the estimated cost of “transmission” of the records and made technical changes throughout section for purposes of gender neutrality; P.A. 11-147 amended Subsec. (c) to make a technical change in statutory reference.
Cited. 45 CS 101.
Sec. 33-948. Court-ordered inspection. (a) If a corporation does not allow a shareholder who complies with subsection (a) of section 33-946 to inspect and copy any records required by that subsection to be available for inspection, the superior court for the judicial district where the corporation’s principal office or, if none in this state, its registered office is located may summarily order inspection and copying of the records demanded at the corporation’s expense upon application of the shareholder.
(b) If a corporation does not within a reasonable time allow a shareholder to inspect and copy any other record, the shareholder who complies with subsections (c) and (d) of section 33-946 may apply to the superior court for the judicial district where the corporation’s principal office or, if none in this state, its registered office is located for an order to permit inspection and copying of the records demanded. The court shall dispose of an application under this subsection on an expedited basis.
(c) If the court orders inspection and copying of the records demanded, it shall also order the corporation to pay the shareholder’s expenses incurred to obtain the order unless the corporation proves that it refused inspection in good faith because it had a reasonable basis for doubt about the right of the shareholder to inspect the records demanded.
(d) If the court orders inspection and copying of the records demanded, it may impose reasonable restrictions on the use or distribution of the records by the demanding shareholder.
(P.A. 94-186, S. 201, 215; P.A. 97-246, S. 40, 99; P.A. 09-55, S. 20; P.A. 11-147, S. 28.)
History: P.A. 94-186 effective January 1, 1997; P.A. 97-246 amended Subsec. (c) to replace “counsel fees” with “attorney’s fees”, effective June 27, 1997; P.A. 09-55 amended Subsec. (c) to replace “costs, including reasonable attorney’s fees” with “expenses”; P.A. 11-147 amended Subsec. (b) to make technical changes in statutory references.
Cited. 45 CS 101.
Subsec. (b):
Law firm lacked probable cause to file complaint on behalf of shareholder to permit inspection of corporate records in matter where the offer to repurchase shares of stock held by shareholder had expired. 103 CA 20.
Sec. 33-949. Inspection of records by directors. (a) A director of a corporation is entitled to inspect and copy the books, records and documents of the corporation at any reasonable time to the extent reasonably related to the performance of the director’s duties as a director, including duties as a member of a committee, but not for any other purpose or in any manner that would violate any duty to the corporation.
(b) The superior court for the judicial district where the corporation’s principal office or, if none in this state, its registered office is located may order inspection and copying of the books, records and documents at the corporation’s expense, upon application of a director who has been refused such inspection rights, unless the corporation establishes that the director is not entitled to such inspection rights. The court shall dispose of an application under this subsection on an expedited basis.
(c) If an order is issued, the court may include provisions protecting the corporation from undue burden or expense, and prohibiting the director from using information obtained upon exercise of the inspection rights in a manner that would violate a duty to the corporation, and may also order the corporation to reimburse the director for the director’s expenses incurred in connection with the application.
(P.A. 01-199, S. 28; P.A. 09-55, S. 21.)
History: P.A. 09-55 amended Subsec. (c) to replace “the director’s costs, including reasonable counsel fees” with “the director’s expenses”.
Sec. 33-950. Exception to notice requirement. (a) Whenever notice would otherwise be required to be given under any provision of sections 33-600 to 33-998, inclusive, to a shareholder, such notice need not be given if:
(1) Notices to the shareholders of two consecutive annual meetings, and all notices of meetings during the period between such two consecutive annual meetings, have been sent to such shareholder at such shareholder’s address as shown on the records of the corporation and have been returned undeliverable or could not be delivered; or
(2) All, but not less than two, payments of dividends on securities during a twelve-month period, or two consecutive payments of dividends on securities during a period of more than twelve months, have been sent to such shareholder at such shareholder’s address as shown on the records of the corporation and have been returned undeliverable or could not be delivered.
(b) If any such shareholder delivers to the corporation a written notice setting forth such shareholder’s current address, the requirement that notice be given to such shareholder shall be reinstated.
(P.A. 01-199, S. 29; P.A. 11-147, S. 25.)
History: P.A. 11-147 amended Subsec. (a) to rephrase prefatory language, replace “Notice” with “Notices to the shareholders” and include notices that “could not be delivered” in Subdiv. (1) and include payments of dividends that “could not be delivered” in Subdiv. (2).
(B)
REPORTS
Sec. 33-951. Financial statements for shareholders. (a) A corporation, except a corporation required by law to file financial reports with the Banking Commissioner, the Insurance Commissioner or the Public Utilities Regulatory Authority, shall furnish its shareholders annual financial statements, which may be consolidated or combined statements of the corporation and one or more of its subsidiaries, as appropriate, that include a balance sheet as of the end of the fiscal year, an income statement for that year, and a statement of changes in shareholders’ equity for the year unless that information appears elsewhere in the financial statements. If financial statements are prepared for the corporation on the basis of generally accepted accounting principles, the annual financial statements must also be prepared on that basis.
(b) If the annual financial statements are reported upon by a public accountant, his report must accompany them. If not, the statements must be accompanied by a statement of the president or the person responsible for the corporation’s accounting records: (1) Stating his reasonable belief whether the statements were prepared on the basis of generally accepted accounting principles and, if not, describing the basis of preparation; and (2) describing any respects in which the statements were not prepared on a basis of accounting consistent with the statements prepared for the preceding year.
(c) Such corporation shall deliver the annual financial statements to each shareholder within one hundred twenty days after the close of each fiscal year. Thereafter, on written request from a shareholder to whom the statements were not delivered, the corporation shall deliver to such shareholder the latest financial statements. Any delivery of financial statements by electronic transmission permitted by this section must be in a manner authorized by the shareholder. A public corporation may fulfill its responsibilities under this subsection by delivering the specified financial statements, or otherwise making them available, in any manner permitted by the applicable rules and regulations of the United States Securities and Exchange Commission.
(P.A. 94-186, S. 202, 215; P.A. 03-84, S. 22; P.A. 09-55, S. 30; P.A. 11-80, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 03-84 changed “Commissioner of Banking” to “Banking Commissioner” in Subsec. (a), effective June 3, 2003; P.A. 09-55 amended Subsec. (c) to replace “mail” and “mailed” with “deliver” and “delivered”, add requirement that delivery by electronic transmission be in a manner authorized by the shareholder, add provision re public corporation may fulfill its responsibilities by delivering or making available the financial statements in a manner permitted by the Securities and Exchange Commission and make technical changes; pursuant to P.A. 11-80, “Department of Public Utility Control” was changed editorially by the Revisors to “Public Utilities Regulatory Authority” in Subsec. (a), effective July 1, 2011.
Sec. 33-952. Other reports to shareholders. Section 33-952 is repealed, effective October 1, 2001.
(P.A. 94-186, S. 203, 215; P.A. 01-199, S. 47.)
Sec. 33-953. Reports. (a) Each domestic corporation, except banks, trust companies, insurance or surety companies, savings and loan associations and public service companies, as defined in section 16-1, and each foreign corporation authorized to transact business in this state, shall file an annual report with the Secretary of the State as prescribed in this section.
(b) The first annual report of a domestic corporation formed prior to January 1, 2020, shall be filed not later than two years after the date on which the corporation filed its certificate of incorporation. The first annual report of a corporation formed on or after January 1, 2020, shall be filed not later than ninety days after the date on which such corporation filed its certificate of incorporation. Subsequent annual reports of a domestic corporation and annual reports of each foreign corporation authorized to transact business in this state shall be filed by electronic transmission on the anniversary date of the filing of the first annual report. Upon request of a corporation, the Secretary of the State may grant an exemption from the requirement to file an annual report by electronic transmission if the corporation does not have the capability to file by electronic transmission or make payment in an authorized manner by electronic means or if other good cause is shown.
(c) Each annual report shall set forth: (1) The name of the corporation; (2) the principal office of the corporation or, in the case of a foreign corporation (A) the address of the principal office of the foreign corporation in the state under the laws of which it is incorporated, (B) the address of the executive offices of the foreign corporation, and (C) the address of the principal office of the foreign corporation in this state, if any; (3) the electronic mail address, if any, of the corporation; (4) the name and address of the registered agent; (5) the names and respective business and residence addresses of the directors and officers of the corporation, except that if good cause is shown, the Secretary of the State may accept business addresses in lieu of business and residence addresses of the directors and officers of the corporation; and (6) such additional information, including the North American Industry Classification System Code, that the Secretary deems pertinent for determining the principal purpose of the corporation. For the purposes of this subsection, a showing of good cause shall include, but not be limited to, a showing that public disclosure of the residence addresses of the corporation’s directors and officers may expose the personal security of such directors and officers to significant risk.
(d) Each annual report shall be accompanied by the required filing fee. The report shall be executed as set forth in section 33-608. The Secretary of the State shall deliver to each domestic corporation at its principal office or electronic mail address, as shown by the Secretary’s records, and to each foreign corporation authorized to transact business in this state at its executive offices or electronic mail address, as last shown by the Secretary’s records, notice that the annual report is due, but failure to receive such notice shall not relieve a corporation of the requirement of filing the report as provided in this section.
(P.A. 94-186, S. 204, 215; P.A. 96-271, S. 145, 254; P.A. 98-137, S. 15, 62; 98-219, S. 33, 34; P.A. 04-240, S. 4; P.A. 11-146, S. 2; P.A. 19-40, S. 1.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 amended Subsec. (a) to rephrase and restructure provisions, make the filing requirement applicable to each “domestic” corporation and “each foreign corporation authorized to transact business in this state” and replace “building and loan associations” with “savings and loan associations”, amended Subsec. (b) to delete references to first or subsequent “biennial” reports, make the time limit to file the first annual report applicable to “domestic” corporations and require “biennial or annual reports of each foreign corporation authorized to transact business in this state” to be filed at such times as may be provided by regulations, amended Subsec. (c) to require each report of a foreign corporation to set forth the address of the principal office of the corporation in the state under the laws of which it is incorporated, the address of the executive offices of the corporation and the address of the principal office of the corporation in this state, if any, and amended Subsec. (e) to make the requirement that the Secretary of the State mail to each corporation a form applicable to each “domestic” corporation and “each foreign corporation authorized to transact business in this state at its executive offices as last shown by his records”, effective January 1, 1997; P.A. 98-137 amended Subsec. (c) to rephrase and make technical changes to provision re good cause, effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section; P.A. 04-240 deleted provisions re biennial reports and made conforming and technical changes; P.A. 11-146 amended Subsec. (b) to require subsequent annual reports of domestic corporations and annual reports of foreign corporations to be filed “by electronic transmission” and add provision re authority of Secretary of the State to grant exemption from electronic filing requirement if corporation does not have capability to file or pay electronically or if other good cause is shown, amended Subsec. (c) to add new Subdiv. (3) re electronic mail address and redesignate existing Subdiv. (3) as Subdiv. (4) and amended Subsec. (e) to require Secretary of the State to “deliver” a “notice that the annual report is due”, rather than “mail” a “form prescribed by him for the annual report”, allow delivery of such notice to corporation’s electronic mail address and make a conforming change, effective January 1, 2012; P.A. 19-40 amended Subsec. (b) to add provisions re first annual report of domestic corporation formed prior to January 1, 2020 to be filed not later than 2 years after date on which corporation filed certificate of incorporation, first annual report of corporation formed on or after January 1, 2020 to be filed not later than 90 days after date on which corporation filed certificate of incorporation, and subsequent annual reports to be filed on anniversary date of filing first annual report, and delete provision re Secretary adopting regulations re report filing times, amended Subsec. (c) to delete provision re report setting forth date which complies with Subsec. (d), add new Subdiv. (4) re name and address of registered agent, redesignate existing Subdiv. (4) as Subdiv. (5) and adding Subdiv. (6) re additional information deemed pertinent by Secretary, deleted former Subsec. (d) re dates specified in annual report and redesignated existing Subsec. (e) as Subsec. (d) and made technical and conforming changes, effective January 1, 2020.
Sec. 33-954. Failure to file report. Incorrect report. (a) Any corporation required to file annual reports as provided in section 33-953, which fails to file its annual report on or before the due date thereof, shall be in default in respect thereof until the same is filed.
(b) The Secretary of the State shall not accept for filing a report from a corporation until any default for failure to file any prior report is cured. If the Secretary of the State finds that any annual report received from a corporation does not conform to law, he may return it to the corporation for correction. If the report is returned for correction and is not received by the Secretary of the State in corrected form on or before the due date thereof, the corporation shall be in default for failure to file its report. If the report is returned for failure to file any previous report and is not returned with any such previous report on or before the due date of the current report, the corporation shall be in default for failure to file two reports.
(P.A. 94-186, S. 205, 215; P.A. 95-252, S. 32, 36; P.A. 96-271, S. 146, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 95-252 deleted Subsec. (c) that had required the Secretary of the State to effect the administrative dissolution of a corporation that is in default of filing its annual report, effective January 1, 1997; P.A. 96-271 amended Subsec. (b) to delete provision re filing fee for corrected report filed after the due date thereof, effective January 1, 1997.
Sec. 33-955. Interim notice of change of director or officer. (a) When the directors or officers of a domestic or foreign corporation that is required to file an annual report pursuant to subsection (a) of section 33-953 change after the corporation has filed its most current annual report and not later than thirty days preceding the month during which the corporation’s next annual report becomes due, the corporation shall file with the Secretary of the State an interim notice of change of director or officer that sets forth: (1) The name of the corporation, and (2) the names, titles and respective business and residence addresses of any new director or officer and the names and titles of any director or officer who has ceased to hold office. If good cause is shown, the Secretary of the State may accept business addresses in lieu of business and residence addresses of the directors and officers of the corporation. For purposes of this section, a showing of good cause shall include, but not be limited to, a showing that public disclosure of the residence addresses of the corporation’s directors and officers may expose the personal security of such directors and officers to significant risk.
(b) Any changes to the directors or officers of a domestic or foreign corporation that occur within the thirty-day period preceding the month during which the corporation’s annual report becomes due shall be reflected on such corporation’s next annual report filed pursuant to section 33-953.
(P.A. 98-137, S. 10, 62; 98-219, S. 33, 34.)
History: P.A. 98-137 effective July 1, 1998; P.A. 98-219 revised effective date of P.A. 98-137, but without affecting this section.
Secs. 33-956 to 33-994. Reserved for future use.
PART XVIII
MISCELLANEOUS PROVISIONS
Sec. 33-995. Applicability to domestic corporations in existence on January 1, 1997. Sections 33-600 to 33-998, inclusive, apply to all domestic corporations in existence on January 1, 1997, that were incorporated under any general statute of this state providing for incorporation of corporations with capital stock if power to amend or repeal the statute under which the corporation was incorporated was reserved.
(P.A. 94-186, S. 206, 215; P.A. 96-271, S. 147, 254.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced “corporations for profit” with “corporations with capital stock”, effective January 1, 1997.
Plaintiffs failed to prove either statutory or classical aggrievement and lacked standing to challenge Secretary of the State’s certificate of reinstatement and name change of a company that had been dissolved administratively. 105 CA 654.
Sec. 33-996. Applicability to qualified foreign corporations. A foreign corporation authorized to transact business in this state on January 1, 1997, is subject to sections 33-600 to 33-998, inclusive, but is not required to obtain a new certificate of authority to transact business under said sections.
(P.A. 94-186, S. 207, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-997. Saving provisions. (a) Except as provided in subsection (b) of this section, the repeal of a statute by public act 94-186 does not affect: (1) The operation of the statute or any action taken under it before its repeal; (2) any ratification, right, remedy, privilege, obligation or liability acquired, accrued or incurred under the statute before its repeal; (3) any violation of the statute, or any penalty, forfeiture or punishment incurred because of the violation, before its repeal; (4) any proceeding, reorganization or dissolution commenced under the statute before its repeal, and the proceeding, reorganization or dissolution may be completed in accordance with the statute as if it had not been repealed.
(b) If a penalty or punishment imposed for violation of a statute repealed by public act 94-186 is reduced by sections 33-600 to 33-998, inclusive, the penalty or punishment if not already imposed shall be imposed in accordance with said sections.
(c) In the event that any provisions of sections 33-600 to 33-998, inclusive, are deemed to modify, limit or supersede the federal Electronic Signatures in Global and National Commerce Act, 15 USC 7001 et seq., the provisions of sections 33-600 to 33-998, inclusive, shall control to the maximum extent permitted by Section 102(a)(2) of that federal act.
(P.A. 94-186, S. 208, 215; P.A. 11-147, S. 26.)
History: P.A. 94-186 effective January 1, 1997; P.A. 11-147 added Subsec. (c) re relationship between chapter and federal Electronic Signatures in Global and National Commerce Act.
Sec. 33-997a. Reservation of power to amend or repeal. The General Assembly has power to amend or repeal all or part of sections 33-600 to 33-998, inclusive, at any time, and all domestic and foreign corporations subject to said sections are governed by the amendment or repeal.
(P.A. 96-271, S. 148, 254.)
History: P.A. 96-271 effective January 1, 1997.
Sec. 33-998. Severability. If any provision of sections 33-600 to 33-998, inclusive, or its application to any person or circumstance is held invalid by a court of competent jurisdiction, the invalidity does not affect other provisions or applications of said sections that can be given effect without the invalid provision or application, and to this end the provisions of said sections are severable.
(P.A. 94-186, S. 209, 215.)
History: P.A. 94-186 effective January 1, 1997.
Sec. 33-999. Reserved for future use.
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