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91_SB0734enr SB734 Enrolled LRB9105965SMdv 1 AN ACT to amend the General Not For Profit Corporation 2 Act of 1986 by changing Sections 107.03, 107.05, 107.15, 3 107.75, and 108.21 and by adding Section 107.90. 4 Be it enacted by the People of the State of Illinois, 5 represented in the General Assembly: 6 Section 5. The General Not For Profit Corporation Act of 7 1986 is amended by changing Sections 107.03, 107.05, 107.15, 8 107.75, and 108.21 and by adding Section 107.90 as follows: 9 (805 ILCS 105/107.03) (from Ch. 32, par. 107.03) 10 Sec. 107.03. Members. 11 (a) A corporation may have one or more classes of 12 members or may have no members. 13 (b) If the corporation has one or more classes of 14 members, the designation of the class or classes and the 15 qualifications and rights of the members of each class shall 16 be set forth in the articles of incorporation or the bylaws. 17 The articles of incorporation or the bylaws may provide for 18 representatives or delegates of members and may establish 19 their qualifications and rights. 20 (c) If the corporation is to have no members, that fact 21 shall be set forth in the articles of incorporation or the 22 bylaws. 23 (d) A corporation may issue certificate evidencing 24 membership therein. 25 (e) The transfer of a certificate of membership in a 26 not-for-profit corporation in which assets are held for a 27 charitable, religious, eleemosynary, benevolent or 28 educational purpose, shall be without payment of any 29 consideration of money or property of any kind or value to 30 the transferor in respect to such transfer. Any transfer in 31 violation of this Section shall be void. SB734 Enrolled -2- LRB9105965SMdv 1 (f) Where the articles of incorporation or bylaws 2 provide that a corporation shall have no members, or where a 3 corporation has under its articles of incorporation, bylaws 4 or in fact no members entitled to vote on a matter, any 5 provision of this Act requiring notice to, the presence of, 6 or the vote, consent or other action by members of the 7 corporation in connection with such matter shall be satisfied 8 by notice to, the presence of, or the vote, consent or other 9 action of the directors of the corporation. 10 (g) A residential cooperative not-for-profit corporation 11 containing 50 or more single family units with individual 12 unit legal descriptions based upon a recorded plat of a 13 subdivision and located in a county with a population between 14 780,000 and 3,000,000 shall specifically set forth the 15 qualifications and rights of its members in the Articles of 16 Incorporation and the bylaws. 17 (Source: P.A. 87-854.) 18 (805 ILCS 105/107.05) (from Ch. 32, par. 107.05) 19 Sec. 107.05. Meeting of members. (a) Meetings of 20 members may be held at such place, either within or without 21 this State, as may be provided in the bylaws or in a 22 resolution of the board of directors pursuant to authority 23 granted in the bylaws. In the absence of any such provision, 24 all meetings shall be held at the registered office of the 25 corporation in this State. 26 (b) An annual meeting of the members entitled to vote 27 may be held at such time as may be provided in the bylaws or 28 in a resolution of the board of directors pursuant to 29 authority granted in the bylaws. Failure to hold the annual 30 meeting at the designated time shall not work a forfeiture or 31 dissolution of the corporation nor affect the validity of 32 corporate action. If an annual meeting has not been held 33 within the earlier of six months after the end of the SB734 Enrolled -3- LRB9105965SMdv 1 corporation's fiscal year or fifteen months after its last 2 annual meeting and if, after a request in writing directed to 3 the president of the corporation, a notice of meeting is not 4 delivered to members entitled to vote within 60 days of such 5 request, then any member entitled to vote at an annual 6 meeting may apply to the circuit court of the county in which 7 the registered office or principal place of business of the 8 corporation is located for an order directing that the 9 meeting be held and fixing the time and place of the meeting. 10 The court may issue such additional orders as may be 11 necessary or appropriate for the holding of the meeting. 12 (c) Special meetings of the members may be called by the 13 president or by the board of directors. Special meetings of 14 the members may also be called by such other officers or 15 persons or number or proportion of members entitled to vote 16 as may be provided in the articles of incorporation or the 17 bylaws. In the absence of a provision fixing the number or 18 proportion of members entitled to vote who are entitled to 19 call a meeting, a special meeting of members entitled to vote 20 may be called by such members having one-twentieth of the 21 votes entitled to be cast at such meeting. 22 (d) Unless specifically prohibited by the articles of 23 incorporation or bylaws, members entitled to vote may 24 participate in and act at any meeting through the use of a 25 conference telephone or other communications equipment by 26 means of which all persons participating in the meeting can 27 communicate with each other. Participation in such meeting 28 shall constitute attendance and presence in person at the 29 meeting of the person or persons so participating. 30 (e) For meetings of a not-for-profit corporation 31 organized for the purpose of residential cooperative housing, 32 consisting of 50 or more single family dwellings with 33 individual unit legal descriptions based upon a recorded plat 34 of a subdivision, and located in a county containing a SB734 Enrolled -4- LRB9105965SMdv 1 population between 780,000 and 3,000,000 inhabitants, any 2 member may record by tape, film, or other means the 3 proceedings at the meetings. The board or the membership may 4 prescribe reasonable rules and regulations to govern the 5 making of the recordings. The portion of any meeting held to 6 discuss violations of rules and regulations of the 7 corporation by a residential shareholder shall be recorded 8 only with the affirmative assent of that shareholder. 9 (Source: P.A. 84-1423.) 10 (805 ILCS 105/107.15) (from Ch. 32, par. 107.15) 11 Sec. 107.15. Notice of members' meetings. Written 12 notice stating the place, day, and hour of the meeting and, 13 in the case of a special meeting, the purpose or purposes for 14 which the meeting is called, shall be delivered not less than 15 5 nor more than 60 days before the date of the meeting, or in 16 the case of a removal of one or more directors, a merger, 17 consolidation, dissolution or sale, lease or exchange of 18 assets not less than 20 nor more than 60 days before the date 19 of the meeting, by or at the direction of the president, or 20 the secretary, or the officer or persons calling the meeting, 21 to each member of record entitled to vote at such meeting. A 22 residential cooperative not-for-profit corporation containing 23 50 or more single family units with individual unit legal 24 descriptions based upon a recorded plat of a subdivision and 25 located in a county with a population between 780,000 and 26 3,000,000 shall, in addition to the other requirements of 27 this Section, post notice of member's meetings in conspicuous 28 places in the residential cooperative at least 48 hours prior 29 to the meeting of the members. 30 (Source: P.A. 84-1423.) 31 (805 ILCS 105/107.75) (from Ch. 32, par. 107.75) 32 Sec. 107.75. Books and records. SB734 Enrolled -5- LRB9105965SMdv 1 (a) Each corporation shall keep correct and complete 2 books and records of account and shall also keep minutes of 3 the proceedings of its members, board of directors and 4 committees having any of the authority of the board of 5 directors; and shall keep at its registered office or 6 principal office a record giving the names and addresses of 7 its members entitled to vote. All books and records of a 8 corporation may be inspected by any member entitled to vote, 9 or that member's agent or attorney, for any proper purpose at 10 any reasonable time. 11 (b) A residential cooperative not-for-profit corporation 12 containing 50 or more single family units with individual 13 unit legal descriptions based upon a recorded plat of a 14 subdivision and located in a county with a population between 15 780,000 and 3,000,000 shall keep an accurate and complete 16 account of all transfers of membership and shall, on a 17 quarterly basis, record all transfers of membership with the 18 county clerk of the county in which the residential 19 cooperative is located. Additionally, a list of all 20 transfers of membership shall be available for inspection by 21 any member of the corporation. 22 (Source: P.A. 84-1423.) 23 (805 ILCS 105/107.90 new) 24 Sec. 107.90. Not-for-profit residential cooperative. 25 (a) As used in this Section: 26 "Member" includes the plural "members", where a 27 membership is jointly held. 28 "Membership agreement" means the contract and other 29 documents that define the rights of the member to occupy, 30 use, or possess a portion or all of a parcel of real 31 estate exclusively. 32 "Class of membership" means a grouping of members 33 based on the same privileges, rights, and manner of SB734 Enrolled -6- LRB9105965SMdv 1 treatment by the corporation. 2 (b) The provisions of this Section apply only to a 3 not-for-profit corporation organized for the purpose of 4 residential cooperative housing consisting of 50 or more 5 single family dwellings with individual unit legal 6 descriptions based upon a recorded plat of a subdivision, 7 located in a county containing a population between 780,000 8 and 3,000,000 inhabitants, and for which the title to one or 9 more member's parcels is held by the corporation. 10 (c) If (i) title for real property occupied or 11 controlled by a member under a membership agreement is held 12 by or is transferred to that member; (ii) more than one class 13 of membership exists; or (iii) the corporation fails to 14 obtain recognition or loses recognition as a Cooperative 15 Housing Corporation under Section 216 of the Internal Revenue 16 Code of 1954, as amended, then: 17 (1) The board of directors shall issue notice to 18 the members within 10 days after obtaining knowledge of 19 (i), (ii), or (iii), or within 10 days after the 20 effective date of this amendatory Act of the 91st General 21 Assembly, if the board obtained such knowledge before the 22 effective date of this amendatory Act of the 91st General 23 Assembly. 24 (2) At the member's option, any member may receive 25 a warranty deed for full title to the real property that 26 he or she occupies issued by the not-for-profit 27 corporation, upon presentation of a notarized and written 28 request to the corporation, provided that the corporation 29 holds the title. 30 (3) The member may withdraw from the corporation, 31 at the member's option. The member shall retain his or 32 her interest in any common property held by the 33 corporation or may transfer his or her interest to the 34 corporation for fair value, at the member's option. SB734 Enrolled -7- LRB9105965SMdv 1 (805 ILCS 105/108.21) (from Ch. 32, par. 108.21) 2 Sec. 108.21. Meetings of the board of directors of a 3 residential cooperative not-for-profit corporation containing 4 24 or more units and located in a city containing more than 5 1,000,000 inhabitants or containing 50 or more single family 6 units with individual unit legal descriptions based upon a 7 recorded plat of a subdivision and located in a county with a 8 population between 780,000 and 3,000,000 inhabitants shall be 9 open to any member, except for the portion of any meeting 10 held (i) to discuss litigation when an action against or on 11 behalf of the corporation has been filed and is pending in a 12 court or administrative tribunal, or when the board of 13 directors finds that such an action is probable or imminent, 14 (ii) to consider information regarding appointment, 15 employment or dismissal of an employee, or (iii) to discuss 16 violations of rules and regulations of the corporation by a 17 residential shareholder. Any member may record by tape, film 18 or other means the proceedings at such meetings or portions 19 thereof required to be open by this Section. The board may 20 prescribe reasonable rules and regulations to govern the 21 right to make such recordings. Notice of such meetings shall 22 be mailed or delivered at least 48 hours prior thereto, 23 unless a written waiver of such notice is signed by the 24 person or persons entitled to such notice pursuant to the 25 articles of incorporation, bylaws, other instrument before 26 the meeting is convened. Copies of notices of meetings of the 27 board of directors shall be posted in entranceways, 28 elevators, or other conspicuous places in the residential 29 cooperative at least 48 hours prior to the meeting of the 30 board of directors. If there is no common entranceway for 7 31 or more apartments, the board of directors may designate one 32 or more locations in the proximity of such units where the 33 notices of meetings shall be posted. For purposes of this 34 Section, "meeting of the board of directors" means any SB734 Enrolled -8- LRB9105965SMdv 1 gathering of a quorum of the members of the board of 2 directors of the residential cooperative held for the purpose 3 of discussing business of the cooperative. The provisions of 4 this Section shall apply to any residential cooperative 5 containing 24 or more units and located in a city containing 6 more than 1,000,000 inhabitants or containing 50 or more 7 single family units and located in a county with a population 8 between 780,000 and 3,000,000 inhabitants situated in the 9 State of Illinois regardless of where such cooperative may be 10 incorporated. 11 (Source: P.A. 84-1423.) 12 Section 99. Effective date. This Act takes effect upon 13 becoming law. 14 _________________________________ 15 President of the Senate 16 _________________________________ 17 Speaker, House of Representatives