1997 Minnesota Statutes

     319A.12 Changes in corporate status. 

    Subdivision 1.  A professional corporation or foreign 
 professional corporation shall report to the board having 
 jurisdiction of the professional service which the corporation 
 is authorized to render the death of any of its shareholders or 
 members within 30 days of such death.  Within 90 days following 
 the date of death of a shareholder of a professional corporation 
 or the loss of a license to render professional service, all of 
 the shares of stock owned by such shareholder or the member's 
 membership shall be transferred to and acquired by the 
 professional corporation or persons qualified to own such shares 
 of stock or membership.  If the articles of incorporation, 
 bylaws, or a written agreement of the shareholders of a 
 professional corporation fail to state a price or a method of 
 determining a price at which the corporation or its shareholders 
 may purchase the shares of stock or membership of a deceased 
 shareholder or a shareholder no longer qualified to own shares 
 of stock in the corporation or membership, then the price for 
 the shares of stock or membership shall be the fair market value 
 as determined by the board of directors, or in the case of a 
 limited liability partnership, the partners, unless the 
 partnership agreement delegates the determination to one or more 
 managing partners, but not less than the book value as of the 
 end of the month immediately preceding the death or 
 disqualification of the shareholder or member.  Book value shall 
 be determined from the books and records of the corporation in 
 accordance with its regular method of accounting.  This 
 subdivision does not change the effect of sections 323.28 and 
 323.30, under which the dissociation of any partner from a 
 limited liability partnership causes the dissolution of that 
 partnership. 

    Subd. 1a.  A professional corporation may at any time by 
 amendment to its articles of incorporation relinquish the powers 
 and privileges conferred upon it by this chapter and elect to be 
 governed thereafter solely by the provisions of chapter 302A, 
 317A, 322B, or 323, as the case may be.  Notwithstanding any 
 provision of this chapter, the representative of a deceased or 
 incompetent shareholder of a professional corporation shall have 
 authority to vote the deceased or incompetent shareholder's 
 shares on the question of adopting such an amendment. 

    Subd. 2.  If within 90 days following the date of death of 
 a shareholder or member of a professional corporation or the 
 loss of a license to render professional service all of the 
 shares or membership owned by the deceased or disqualified 
 shareholder or member have not been transferred to and acquired 
 by the corporation or persons qualified to own the shares or 
 membership, the corporation shall thereafter be governed solely 
 by the provisions of chapter 302A, 317A, 322B, or 323, as the 
 case may be and shall not enjoy any of the powers and privileges 
 conferred by sections 319A.01 to 319A.22.  When the corporation 
 ceases to be authorized to render professional service, its 
 corporate name must be changed to comply with the corporate name 
 provision of chapter 302A, 317A, 322B, or 323, as the case may 
 be, and any words, phrases or abbreviations contained therein to 
 comply with the provisions of sections 319A.01 to 319A.22 shall 
 be eliminated. 

    Subd. 3.  A professional corporation may purchase its 
 shares of stock without regard to any restrictions provided by 
 law upon the repurchase of its stock if after each repurchase at 
 least one share of stock remains outstanding.  

    HIST: 1973 c 40 s 12; 1979 c 21 s 2; 1981 c 270 s 134,135; 
 1986 c 444; 1987 c 384 art 2 s 80,81; 1989 c 304 s 137; 1992 c 
 517 art 1 s 27,28; 1994 c 539 s 6-8