Text: HSB00228 Text: HSB00230 Text: HSB00200 - HSB00299 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 SUBCHAPTER I 1 2 GENERAL PROVISIONS 1 3 PART 1 1 4 SHORT TITLE AND APPLICATIONS 1 5 Section 1. NEW SECTION. 504A.101A SHORT TITLE. 1 6 This chapter shall be known and may be cited as the "Iowa 1 7 Nonprofit Corporation Act". 1 8 Sec. 2. NEW SECTION. 504A.102 RESERVATION OF POWER TO 1 9 AMEND OR REPEAL. 1 10 The general assembly has power to amend or repeal all or 1 11 part of this chapter at any time and all domestic and foreign 1 12 corporations subject to this chapter are governed by the 1 13 amendment or repeal. 1 14 PART 2 1 15 FILING DOCUMENTS 1 16 Sec. 3. NEW SECTION. 504A.111 FILING REQUIREMENTS. 1 17 1. A document must satisfy the requirements of this 1 18 section, and of any other section that adds to or varies these 1 19 requirements, to be entitled to filing by the secretary of 1 20 state. 1 21 2. This chapter must require or permit filing the document 1 22 in the office of the secretary of state. 1 23 3. The document must contain the information required by 1 24 this subchapter. It may contain other information as well. 1 25 4. The document must be typewritten or printed. 1 26 5. The document must be in the English language. However, 1 27 a corporate name need not be in English if written in English 1 28 letters or Arabic or Roman numerals. The certificate of 1 29 existence required of foreign corporations need not be in 1 30 English if accompanied by a reasonably authenticated English 1 31 translation. 1 32 6. The document must be executed by one of the following: 1 33 a. The presiding officer of its board of directors of a 1 34 domestic or foreign corporation, its president, or by another 1 35 of its officers. 2 1 b. If directors have not been selected or the corporation 2 2 has not been formed, by an incorporator. 2 3 c. If the corporation is in the hands of a receiver, 2 4 trustee, or other court-appointed fiduciary, by that 2 5 fiduciary. 2 6 7. The person executing a document shall sign it and state 2 7 beneath or opposite the signature the person's name and the 2 8 capacity in which the person signs. The document may contain 2 9 any of the following: 2 10 a. The corporate seal. 2 11 b. An attestation by the secretary or an assistant 2 12 secretary. 2 13 c. An acknowledgment, verification, or proof. 2 14 8. If the secretary of state has prescribed a mandatory 2 15 form for a document under section 504A.112, the document must 2 16 be in or on the prescribed form. 2 17 9. The document must be delivered to the office of the 2 18 secretary of state for filing and must be accompanied by one 2 19 exact or conformed copy, except as provided in sections 2 20 504A.503 and 504A.1509, the correct filing fee, and any 2 21 franchise tax, license fee, or penalty required by this 2 22 chapter or other law. 2 23 Sec. 4. NEW SECTION. 504A.112 FORMS. 2 24 1. The secretary of state may prescribe and furnish on 2 25 request, forms for an application for a certificate of 2 26 existence, a foreign corporation's application for a 2 27 certificate of authority to transact business in this state, a 2 28 foreign corporation's application for a certificate of 2 29 withdrawal, and the biennial report. If the secretary of 2 30 state so requires, use of these forms is mandatory. 2 31 2. The secretary of state may prescribe and furnish on 2 32 request forms for other documents required or permitted to be 2 33 filed by this chapter but their use is not mandatory. 2 34 Sec. 5. NEW SECTION. 504A.113 FILING, SERVICE, AND 2 35 COPYING FEES. 3 1 1. The secretary of state shall collect the following fees 3 2 when the documents described in this subsection are delivered 3 3 for filing: 3 4 DOCUMENT FEE 3 5 a. Articles of incorporation .................... $_______ 3 6 b. Application for use of indistinguishable 3 7 name ................................................ $_______ 3 8 c. Application for reserved name ................ $_______ 3 9 d. Notice of transfer of reserved name .......... $_______ 3 10 e. Application for registered name .............. $_______ 3 11 f. Application for renewal of registered name ... $_______ 3 12 g. Corporation's statement of change of 3 13 registered agent or registered office or both ....... $_______ 3 14 h. Agent's statement of change of registered 3 15 office for each affected corporation not to 3 16 exceed a total of ................................... $_______ 3 17 i. Agent's statement of resignation ............. no fee 3 18 j. Amendment of articles of incorporation ....... $_______ 3 19 k. Restatement of articles of incorporation 3 20 with amendments ..................................... $_______ 3 21 l. Articles of merger ........................... $_______ 3 22 m. Articles of dissolution ...................... $_______ 3 23 n. Articles of revocation of dissolution ........ $_______ 3 24 o. Certificate of administrative dissolution .... $_______ 3 25 p. Application for reinstatement following 3 26 administrative dissolution .......................... $_______ 3 27 q. Certificate of reinstatement ................. no fee 3 28 r. Certificate of judicial dissolution .......... no fee 3 29 s. Application for certificate of authority ..... $_______ 3 30 t. Application for amended certificate of 3 31 authority ........................................... $_______ 3 32 u. Application for certificate of withdrawal .... $_______ 3 33 v. Certificate of revocation of authority 3 34 to transact business ................................ no fee 3 35 w. Biennial report .............................. $_______ 4 1 x. Articles of correction ....................... $_______ 4 2 y. Application for certificate of existence 4 3 or authorization .................................... $_______ 4 4 z. Any other document required or permitted 4 5 to be filed by this Act ............................. $_______ 4 6 2. The secretary of state shall collect a fee upon being 4 7 served with process under this chapter. The party to a 4 8 proceeding causing service of process is entitled to recover 4 9 the fee paid the secretary of state as costs if the party 4 10 prevails in the proceeding. 4 11 3. The secretary of state shall collect fees for copying 4 12 and certifying the copy of any filed document relating to a 4 13 domestic or foreign corporation. 4 14 Sec. 6. NEW SECTION. 504A.114 EFFECTIVE DATE OF 4 15 DOCUMENT. 4 16 1. Except as provided in subsection 2 and section 4 17 504A.115, a document is effective at the later of the 4 18 following times: 4 19 a. At the time of filing on the date it is filed, as 4 20 evidenced by the secretary of state's endorsement on the 4 21 original document. 4 22 b. At the time specified in the document as its effective 4 23 time on the date it is filed. 4 24 2. A document may specify a delayed effective time and 4 25 date, and if it does so the document becomes effective at the 4 26 time and date specified. If a delayed effective date but no 4 27 time is specified, the document is effective at the close of 4 28 business on that date. A delayed effective date for a 4 29 document shall not be later than the ninetieth day after the 4 30 date filed. 4 31 Sec. 7. NEW SECTION. 504A.115 CORRECTING FILED DOCUMENT. 4 32 1. A domestic or foreign corporation may correct a 4 33 document filed by the secretary of state if the document 4 34 contains an incorrect statement or was defectively executed, 4 35 attested, sealed, verified, or acknowledged. 5 1 2. A document is corrected by doing both of the following: 5 2 a. By preparing articles of correction that describe the 5 3 document including its filing date or attach a copy of it to 5 4 the articles, specify the incorrect statement and the reason 5 5 it is incorrect or the manner in which the execution was 5 6 defective, and correct the incorrect statement or defective 5 7 execution. 5 8 b. By delivering the articles of correction to the 5 9 secretary of state. 5 10 3. Articles of correction are effective on the effective 5 11 date of the document they correct except as to persons relying 5 12 on the uncorrected document and adversely affected by the 5 13 correction. As to those persons, articles of correction are 5 14 effective when filed. 5 15 Sec. 8. NEW SECTION. 504A.116 FILING DUTY OF SECRETARY 5 16 OF STATE. 5 17 1. If a document delivered to the office of the secretary 5 18 of state for filing satisfies the requirements of section 5 19 504A.111, the secretary of state shall file it. 5 20 2. The secretary of state files a document by stamping or 5 21 otherwise endorsing "Filed", together with the secretary of 5 22 state's name and official title and the date and the time of 5 23 receipt, on both the original and copy of the document and on 5 24 the receipt for the filing fee. After filing a document, 5 25 except as provided in sections 504A.503 and 504A.1510, the 5 26 secretary of state shall deliver the document copy, with the 5 27 filing fee receipt or acknowledgment of receipt if no fee is 5 28 required attached, to the domestic or foreign corporation or 5 29 its representative. 5 30 3. Upon refusing to file a document, the secretary of 5 31 state shall return it to the domestic or foreign corporation 5 32 or its representative, together with a brief, written 5 33 explanation of the reason or reasons for the refusal. 5 34 4. The secretary of state's duty to file documents under 5 35 this section is ministerial. Filing or refusal to file a 6 1 document does not do any of the following: 6 2 a. Affect the validity or invalidity of the document in 6 3 whole or in part. 6 4 b. Relate to the correctness or incorrectness of 6 5 information contained in the document. 6 6 c. Create a presumption that the document is valid or 6 7 invalid or that information contained in the document is 6 8 correct or incorrect. 6 9 Sec. 9. NEW SECTION. 504A.117 APPEAL FROM SECRETARY OF 6 10 STATE'S REFUSAL TO FILE DOCUMENT. 6 11 1. If the secretary of state refuses to file a document 6 12 delivered for filing to the secretary of state's office, the 6 13 domestic or foreign corporation may appeal the refusal to the 6 14 district court in the county where the corporation's principal 6 15 office, or if there is none in this state, its registered 6 16 office, is or will be located. The appeal is commenced by 6 17 petitioning the court to compel filing the document and by 6 18 attaching to the petition the document and the secretary of 6 19 state's explanation of the refusal to file. 6 20 2. The court may summarily order the secretary of state to 6 21 file the document or take other action the court considers 6 22 appropriate. 6 23 3. The court's final decision may be appealed as in other 6 24 civil proceedings. 6 25 Sec. 10. NEW SECTION. 504A.118 EVIDENTIARY EFFECT OF 6 26 COPY OF FILED DOCUMENT. 6 27 A certificate attached to a copy of a document bearing the 6 28 secretary of state's signature, which may be in facsimile, and 6 29 the seal of this state, is conclusive evidence that the 6 30 original document is on file with the secretary of state. 6 31 Sec. 11. NEW SECTION. 504A.119 CERTIFICATE OF EXISTENCE. 6 32 1. Any person may apply to the secretary of state to 6 33 furnish a certificate of existence for a domestic or foreign 6 34 corporation. 6 35 2. The certificate of existence shall set forth all of the 7 1 following: 7 2 a. The domestic corporation's corporate name or the 7 3 foreign corporation's corporate name used in this state. 7 4 b. That the domestic corporation is duly incorporated 7 5 under the law of this state, the date of its incorporation, 7 6 and the period of its duration if less than perpetual; or that 7 7 the foreign corporation is authorized to transact business in 7 8 this state. 7 9 c. That all fees, taxes, and penalties owed to this state 7 10 have been paid, if payment is reflected in the records of the 7 11 secretary of state and nonpayment affects the good standing of 7 12 the domestic or foreign corporation. 7 13 d. That its most recent biennial report required by 7 14 section 504A.1613 has been delivered to the secretary of 7 15 state. 7 16 e. That articles of dissolution have not been filed. 7 17 f. Other facts of record in the office of the secretary of 7 18 state that may be requested by the applicant. 7 19 3. Subject to any qualification stated in the certificate, 7 20 a certificate of existence issued by the secretary of state 7 21 may be relied upon as conclusive evidence that the domestic or 7 22 foreign corporation is in good standing in this state. 7 23 Sec. 12. NEW SECTION. 504A.120 PENALTY FOR SIGNING FALSE 7 24 DOCUMENT. 7 25 1. A person commits an offense by signing a document such 7 26 person knows is false in any material respect with intent that 7 27 the document be delivered to the secretary of state for 7 28 filing. 7 29 2. An offense under this section is a serious misdemeanor 7 30 punishable by a fine not to exceed one thousand dollars. 7 31 PART 3 7 32 SECRETARY OF STATE 7 33 Sec. 13. NEW SECTION. 504A.131 POWERS. 7 34 The secretary of state has the power reasonably necessary 7 35 to perform the duties required of the secretary of state's 8 1 office by this chapter. 8 2 PART 4 8 3 DEFINITIONS 8 4 Sec. 14. NEW SECTION. 504A.141 CHAPTER DEFINITIONS. 8 5 As used in this chapter, unless the context otherwise 8 6 requires: 8 7 1. "Approved by the members" or "approval by the members" 8 8 means approved or ratified by the affirmative vote of a 8 9 majority of the votes represented and voting at a duly held 8 10 meeting at which a quorum is present which affirmative votes 8 11 also constitute a majority of the required quorum or by a 8 12 written ballot or written consent in conformity with this 8 13 chapter or by the affirmative vote, written ballot, or written 8 14 consent of such greater proportion, including the votes of all 8 15 the members of any class, unit, or grouping as may be provided 8 16 in the articles, bylaws, or this chapter for any specified 8 17 member action. 8 18 2. "Articles of incorporation" or "articles" includes 8 19 amended and restated articles of incorporation and articles of 8 20 merger. 8 21 3. "Board" or "board of directors" means the board of 8 22 directors except that no person or group of persons are the 8 23 board of directors because of powers delegated to that person 8 24 or group pursuant to section 504A.801. 8 25 4. "Bylaws" means the code or codes of rules other than 8 26 the articles adopted pursuant to this chapter for the 8 27 regulation or management of the affairs of the corporation 8 28 irrespective of the name or names by which such rules are 8 29 designated. 8 30 5. "Class" means a group of memberships which have the 8 31 same rights with respect to voting, dissolution, redemption, 8 32 and transfer. For purposes of this section, rights shall be 8 33 considered the same if they are determined by a formula 8 34 applied uniformly. 8 35 6. "Corporation" means a public benefit, mutual benefit, 9 1 and religious corporation. 9 2 7. "Delegates" means those persons elected or appointed to 9 3 vote in a representative assembly for the election of a 9 4 director or directors or on other matters. 9 5 8. "Deliver" includes mail. 9 6 9. "Directors" means individuals, designated in the 9 7 articles or bylaws or elected by the incorporators, and their 9 8 successors and individuals elected or appointed by any other 9 9 name or title to act as members of the board. 9 10 10. "Distribution" means the payment of a dividend or any 9 11 part of the income or profit of a corporation to its members, 9 12 directors, or officers. 9 13 11. "Domestic corporation" means a corporation. 9 14 12. "Effective date of notice" is defined in section 9 15 504A.142. 9 16 13. "Employee" does not include an officer or director who 9 17 is not otherwise employed by the corporation. 9 18 14. "Entity" includes corporation and foreign corporation; 9 19 business corporation and foreign business corporation; profit 9 20 and nonprofit unincorporated association; corporation sole; 9 21 business trust, estate, partnership, trust, and two or more 9 22 persons having a joint or common economic interest; and state, 9 23 United States, and foreign government. 9 24 15. "File", "filed", or "filing" means filed in the office 9 25 of the secretary of state. 9 26 16. "Foreign corporation" means a corporation organized 9 27 under a law other than the law of this state which would be a 9 28 nonprofit corporation if formed under the laws of this state. 9 29 17. "Governmental subdivision" includes authority, county, 9 30 district, and municipality. 9 31 18. "Includes" denotes a partial definition. 9 32 19. "Individual" includes the estate of an incompetent 9 33 individual. 9 34 20. "Means" denotes a complete definition. 9 35 21. "Member" means a person having membership rights in a 10 1 corporation in accordance with the provisions of its articles 10 2 of incorporation or bylaws. 10 3 22. "Membership" refers to the rights and obligations a 10 4 member or members have pursuant to a corporation's articles, 10 5 bylaws, and this chapter. 10 6 23. "Mutual benefit corporation" means a domestic 10 7 corporation which is formed as a mutual benefit corporation 10 8 pursuant to subchapter 2 or is required to be a mutual benefit 10 9 corporation pursuant to section 504A.1705. 10 10 24. "Notice" is defined in section 504A.142. 10 11 25. "Person" includes any individual or entity. 10 12 26. "Principal office" means the office in or out of this 10 13 state so designated in the biennial report filed pursuant to 10 14 section 504A.1613 where the principal offices of a domestic or 10 15 foreign corporation are located. 10 16 27. "Proceeding" includes civil suit and criminal, 10 17 administrative, and investigatory action. 10 18 28. "Public benefit corporation" means a domestic 10 19 corporation which is formed as a public benefit corporation 10 20 pursuant to subchapter 2 or is required to be a public benefit 10 21 corporation pursuant to section 504A.1705. 10 22 29. "Record date" means the date established under 10 23 subchapter 6 or 7 on which a corporation determines the 10 24 identity of its members for the purposes of this subchapter. 10 25 30. "Religious corporation" means a domestic corporation 10 26 which is formed as a religious corporation pursuant to 10 27 subchapter 2 or is required to be a religious corporation 10 28 pursuant to section 504A.1705. 10 29 31. "Secretary" means the corporate officer to whom the 10 30 board of directors has delegated responsibility under section 10 31 504A.841, subsection 2, for custody of the minutes of the 10 32 directors' and members' meetings and for authenticating the 10 33 records of the corporation. 10 34 32. "State", when referring to a part of the United 10 35 States, includes a state and commonwealth and their agencies 11 1 and governmental subdivisions, and a territory and insular 11 2 possession and their agencies and governmental subdivisions of 11 3 the United States. 11 4 33. "United States" includes district, authority, bureau, 11 5 commission, department, and any other agency of the United 11 6 States. 11 7 34. "Vote" includes authorization by written ballot and 11 8 written consent. 11 9 35. "Voting power" means the total number of votes 11 10 entitled to be cast for the election of directors at the time 11 11 the determination of voting power is made, excluding a vote 11 12 which is contingent upon the happening of a condition or event 11 13 that has not occurred at the time. Where a class is entitled 11 14 to vote as a class for directors, the determination of voting 11 15 power of the class shall be based on the percentage of the 11 16 number of directors the class is entitled to elect out of the 11 17 total number of authorized directors. 11 18 Sec. 15. NEW SECTION. 504A.142 NOTICE. 11 19 1. Notice may be oral or written. 11 20 2. Notice may be communicated in person; by telephone, 11 21 telegraph, teletype, or other form of wire or wireless 11 22 communication; or by mail or private carrier. If these forms 11 23 of personal notice are impracticable, notice may be 11 24 communicated by a newspaper of general circulation in the area 11 25 where published or by radio, television, or other form of 11 26 public broadcast communication. 11 27 3. Oral notice is effective when communicated if 11 28 communicated in a comprehensible manner. 11 29 4. Written notice, if in a comprehensible form, is 11 30 effective at the earliest of the following: 11 31 a. When received. 11 32 b. Five days after its deposit in the United States mail, 11 33 as evidenced by the postmark, if mailed correctly addressed 11 34 and with first class postage affixed. 11 35 c. On the date shown on the return receipt, if sent by 12 1 registered or certified mail, return receipt requested, and 12 2 the receipt is signed by or on behalf of the addressee. 12 3 d. Thirty days after its deposit in the United States 12 4 mail, as evidenced by the postmark, if mailed correctly 12 5 addressed and with other than first class, registered, or 12 6 certified postage affixed. 12 7 5. Written notice is correctly addressed to a member of a 12 8 domestic or foreign corporation if addressed to the member's 12 9 address shown in the corporation's current list of members. 12 10 6. A written notice or report delivered as part of a 12 11 newsletter, magazine, or other publication regularly sent to 12 12 members shall constitute a written notice or report if 12 13 addressed or delivered to the member's address shown in the 12 14 corporation's current list of members, or in the case of 12 15 members who are residents of the same household and who have 12 16 the same address in the corporation's current list of members, 12 17 if addressed or delivered to one of such members, at the 12 18 address appearing on the current list of members. 12 19 7. Written notice is correctly addressed to a domestic or 12 20 foreign corporation authorized to transact business in this 12 21 state, other than in its capacity as a member, if addressed to 12 22 its registered agent or to its secretary at its principal 12 23 office shown in its most recent biennial report or, in the 12 24 case of a foreign corporation that has not yet delivered an 12 25 annual report, in its application for a certificate of 12 26 authority. 12 27 8. If section 504A.705, subsection 2, or any other 12 28 provision of this chapter prescribes notice requirements for 12 29 particular circumstances, those requirements govern. If 12 30 articles or bylaws prescribe notice requirements, not 12 31 inconsistent with this section or other provisions of this 12 32 chapter, those requirements govern. 12 33 PART 5 12 34 JUDICIAL RELIEF 12 35 Sec. 16. NEW SECTION. 504A.151 JUDICIAL RELIEF. 13 1 1. If for any reason it is impractical or impossible for 13 2 any corporation to call or conduct a meeting of its members, 13 3 delegates, or directors, or otherwise obtain their consent, in 13 4 the manner prescribed by its articles, bylaws, or this 13 5 chapter, then upon petition of a director, officer, delegate, 13 6 member, or the attorney general, the district court may order 13 7 that such a meeting be called or that a written ballot or 13 8 other form of obtaining the vote of members, delegates, or 13 9 directors be authorized, in such a manner as the court finds 13 10 fair and equitable under the circumstances. 13 11 2. The court shall, in an order issued pursuant to this 13 12 section, provide for a method of notice reasonably designed to 13 13 give actual notice to all persons who would be entitled to 13 14 notice of a meeting held pursuant to the articles, bylaws, and 13 15 this chapter, whether or not the method results in actual 13 16 notice to all such persons or conforms to the notice 13 17 requirements that would otherwise apply. In a proceeding 13 18 under this section, the court may determine who the members or 13 19 directors are. 13 20 3. The order issued pursuant to this section may dispense 13 21 with any requirement relating to the holding of or voting at 13 22 meetings or obtaining votes, including any requirement as to 13 23 quorums or as to the number or percentage of votes needed for 13 24 approval, that would otherwise be imposed by the articles, 13 25 bylaws, or this chapter. 13 26 4. Whenever practical, any order issued pursuant to this 13 27 section shall limit the subject matter of meetings or other 13 28 forms of consent authorized to items, including amendments to 13 29 the articles or bylaws, the resolution of which will or may 13 30 enable the corporation to continue managing its affairs 13 31 without further resort to this section; provided, however, 13 32 that an order under this section may also authorize the 13 33 obtaining of whatever votes and approvals are necessary for 13 34 the dissolution, merger, or sale of assets. 13 35 5. Any meeting or other method of obtaining the vote of 14 1 members, delegates, or directors conducted pursuant to an 14 2 order issued under this section, and which complies with all 14 3 the provisions of such order, is for all purposes a valid 14 4 meeting or vote, as the case may be, and shall have the same 14 5 force and effect as if it complied with every requirement 14 6 imposed by the articles, bylaws, and this chapter. 14 7 PART 6 14 8 ATTORNEY GENERAL 14 9 Sec. 17. NEW SECTION. 504A.161 ATTORNEY GENERAL. 14 10 1. The attorney general shall be given notice of the 14 11 commencement of any proceeding which this chapter authorizes 14 12 the attorney general to bring but which has been commenced by 14 13 another person. 14 14 2. Whenever any provision of this chapter requires that 14 15 notice be given to the attorney general before or after 14 16 commencing a proceeding or permits the attorney general to 14 17 commence a proceeding: 14 18 a. If no proceeding has been commenced, the attorney 14 19 general may take appropriate action including, but not limited 14 20 to, seeking injunctive relief. 14 21 b. If a proceeding has been commenced by a person other 14 22 than the attorney general, the attorney general, as of right, 14 23 may intervene in such proceeding. 14 24 Sec. 18. NEW SECTION. 504A.162 RELIGIOUS CORPORATIONS – 14 25 CONSTITUTIONAL PROTECTIONS. 14 26 If religious doctrine governing the affairs of a religious 14 27 corporation is inconsistent with the provisions of this 14 28 chapter on the same subject, the religious doctrine shall 14 29 control to the extent required by the Constitution of the 14 30 United States or the constitution of this state or both. 14 31 SUBCHAPTER II 14 32 ORGANIZATION 14 33 Sec. 19. NEW SECTION. 504A.201 INCORPORATORS. 14 34 One or more persons may act as the incorporator or 14 35 incorporators of a corporation by delivering articles of 15 1 incorporation to the secretary of state for filing. 15 2 Sec. 20. NEW SECTION. 504A.202 ARTICLES OF 15 3 INCORPORATION. 15 4 1. The articles of incorporation must set forth all of the 15 5 following: 15 6 a. A corporate name for the corporation that satisfies the 15 7 requirements of section 504A.401. 15 8 b. One of the following statements: 15 9 (1) This corporation is a public benefit corporation. 15 10 (2) This corporation is a mutual benefit corporation. 15 11 (3) This corporation is a religious corporation. 15 12 c. The address of the corporation's initial registered 15 13 office and the name of its initial registered agent at that 15 14 office. 15 15 d. The name and address of each incorporator. 15 16 e. Whether the corporation will have members. 15 17 f. Provisions not inconsistent with law regarding the 15 18 distribution of assets on dissolution. 15 19 2. The articles of incorporation may set forth any of the 15 20 following: 15 21 a. Any purpose for which the corporation is organized, 15 22 which may be, either alone or in combination with other 15 23 purposes, the transaction of any lawful activity. 15 24 b. The names and addresses of the individuals who are to 15 25 serve as the initial directors. 15 26 c. Provisions not inconsistent with law regarding all of 15 27 the following: 15 28 (1) Managing and regulating the affairs of the 15 29 corporation. 15 30 (2) Defining, limiting, and regulating the powers of the 15 31 corporation, its board of directors, and members, or any class 15 32 of members. 15 33 (3) The characteristics, qualifications, rights, 15 34 limitations, and obligations attaching to each or any class of 15 35 members. 16 1 d. Any provision that under this chapter is required or 16 2 permitted to be set forth in the bylaws. 16 3 3. Each incorporator named in the articles must sign the 16 4 articles. 16 5 4. The articles of incorporation need not set forth any of 16 6 the corporate powers enumerated in this chapter. 16 7 Sec. 21. NEW SECTION. 504A.203 INCORPORATION. 16 8 1. Unless a delayed effective date is specified, the 16 9 corporate existence begins when the articles of incorporation 16 10 are filed. 16 11 2. The secretary of state's filing of the articles of 16 12 incorporation is conclusive proof that the incorporators 16 13 satisfied all conditions precedent to incorporation except in 16 14 a proceeding by the state to cancel or revoke the 16 15 incorporation or involuntarily dissolve the corporation. 16 16 Sec. 22. NEW SECTION. 504A.204 LIABILITY FOR 16 17 PREINCORPORATION TRANSACTIONS. 16 18 All persons purporting to act as or on behalf of a 16 19 corporation, knowing there was no incorporation under this 16 20 chapter, are jointly and severally liable for all liabilities 16 21 created while so acting. 16 22 Sec. 23. NEW SECTION. 504A.205 ORGANIZATION OF 16 23 CORPORATION. 16 24 1. After incorporation: 16 25 a. If initial directors are named in the articles of 16 26 incorporation, the initial directors shall hold an 16 27 organizational meeting, at the call of a majority of the 16 28 directors, to complete the organization of the corporation by 16 29 appointing officers, adopting bylaws, and carrying on any 16 30 other business brought before the meeting. 16 31 b. If initial directors are not named in the articles, the 16 32 incorporator or incorporators shall hold an organizational 16 33 meeting at the call of a majority of the incorporators to do 16 34 one of the following: 16 35 (1) Elect directors and complete the organization of the 17 1 corporation. 17 2 (2) Elect a board of directors who shall complete the 17 3 organization of the corporation. 17 4 2. Action required or permitted by this chapter to be 17 5 taken by incorporators at an organizational meeting may be 17 6 taken without a meeting if the action taken is evidenced by 17 7 one or more written consents describing the action taken and 17 8 signed by each incorporator. 17 9 3. An organizational meeting may be held in or out of this 17 10 state in accordance with section 504A.822. 17 11 Sec. 24. NEW SECTION. 504A.206 BYLAWS. 17 12 1. The incorporators or board of directors of a 17 13 corporation shall adopt bylaws for the corporation. 17 14 2. The bylaws may contain any provision for regulating and 17 15 managing the affairs of the corporation that is not 17 16 inconsistent with law or the articles of incorporation. 17 17 Sec. 25. NEW SECTION. 504A.207 EMERGENCY BYLAWS AND 17 18 POWERS. 17 19 1. Unless the articles provide otherwise the directors of 17 20 a corporation may adopt, amend, or repeal bylaws to be 17 21 effective only in an emergency defined in subsection 4. The 17 22 emergency bylaws, which are subject to amendment or repeal by 17 23 the members, may provide special procedures necessary for 17 24 managing the corporation during the emergency, including all 17 25 of the following: 17 26 a. How to call a meeting of the board. 17 27 b. Quorum requirements for the meeting. 17 28 c. Designation of additional or substitute directors. 17 29 2. All provisions of the regular bylaws consistent with 17 30 the emergency bylaws remain effective during the emergency. 17 31 The emergency bylaws are not effective after the emergency 17 32 ends. 17 33 3. Corporate action taken in good faith in accordance with 17 34 the emergency bylaws does both of the following: 17 35 a. Binds the corporation. 18 1 b. Shall not be used to impose liability on a corporate 18 2 director, officer, employee, or agent. 18 3 4. An emergency exists for purposes of this section if a 18 4 quorum of the corporation's directors cannot readily be 18 5 assembled because of some catastrophic event. 18 6 SUBCHAPTER III 18 7 PURPOSES AND POWERS 18 8 Sec. 26. NEW SECTION. 504A.301 PURPOSES. 18 9 1. Every corporation incorporated under this chapter has 18 10 the purpose of engaging in any lawful activity unless a more 18 11 limited purpose is set forth in the articles of incorporation. 18 12 2. A corporation engaging in an activity that is subject 18 13 to regulation under another statute of this state may 18 14 incorporate under this chapter only if incorporation under 18 15 this chapter is not prohibited by the other statute. The 18 16 corporation shall be subject to all limitations of the other 18 17 statute. 18 18 Sec. 27. NEW SECTION. 504A.302 GENERAL POWERS. 18 19 Unless its articles of incorporation provide otherwise, 18 20 every corporation has perpetual duration and succession in its 18 21 corporate name and has the same powers as an individual to do 18 22 all things necessary or convenient to carry out its affairs, 18 23 including without limitation all of the following powers: 18 24 1. Sue and be sued, complain, and defend in its corporate 18 25 name. 18 26 2. Have a corporate seal, which may be altered at will, 18 27 and to use it, or a facsimile of it, by impressing or affixing 18 28 or in any other manner reproducing it. 18 29 3. Make and amend bylaws not inconsistent with its 18 30 articles of incorporation or with the laws of this state, for 18 31 regulating and managing the affairs of the corporation. 18 32 4. Purchase, receive, lease, or otherwise acquire, and 18 33 own, hold, improve, use, and otherwise deal with, real or 18 34 personal property, or any legal or equitable interest in 18 35 property, wherever located. 19 1 5. Sell, convey, mortgage, pledge, lease, exchange, and 19 2 otherwise dispose of all or any part of its property. 19 3 6. Purchase, receive, subscribe for, or otherwise acquire, 19 4 own, hold, vote, use, sell, mortgage, lend, pledge, or 19 5 otherwise dispose of, and deal in and with, shares or other 19 6 interests in, or obligations of, any entity. 19 7 7. Make contracts and guarantees, incur liabilities, 19 8 borrow money, issue notes, bonds, and other obligations, and 19 9 secure any of its obligations by mortgage or pledge of any of 19 10 its property, franchises, or income. 19 11 8. Lend money, invest and reinvest its funds, and receive 19 12 and hold real and personal property as security for repayment, 19 13 except as limited by section 504A.833. 19 14 9. Be a promoter, partner, member, associate, or manager 19 15 of any partnership, joint venture, trust, or other entity. 19 16 10. Conduct its activities, locate offices, and exercise 19 17 the powers granted by this chapter within or without this 19 18 state. 19 19 11. Elect or appoint directors, officers, employees, and 19 20 agents of the corporation, define their duties, and fix their 19 21 compensation. 19 22 12. Pay pensions and establish pension plans, pension 19 23 trusts, and other benefit and incentive plans for any or all 19 24 of its current or former directors, officers, employees, and 19 25 agents. 19 26 13. Make donations not inconsistent with law for the 19 27 public welfare or for charitable, religious, scientific, or 19 28 educational purposes and for other purposes that further the 19 29 corporate interest. 19 30 14. Impose dues, assessments, and admission and transfer 19 31 fees upon its members. 19 32 l5. Establish conditions for admission of members, admit 19 33 members, and issue memberships. 19 34 16. Carry on a business. 19 35 17. Do all things necessary or convenient, not 20 1 inconsistent with law, to further the activities and affairs 20 2 of the corporation. 20 3 Sec. 28. NEW SECTION. 504A.303 EMERGENCY POWERS. 20 4 1. In anticipation of or during an emergency defined in 20 5 subsection 4, the board of directors of a corporation may do 20 6 both of the following: 20 7 a. Modify lines of succession to accommodate the 20 8 incapacity of any director, officer, employee, or agent. 20 9 b. Relocate the principal office, designate alternative 20 10 principal offices or regional offices, or authorize the 20 11 officer to do so. 20 12 2. During an emergency defined in subsection 4, unless 20 13 emergency bylaws provide otherwise: 20 14 a. Notice of a meeting of the board of directors need be 20 15 given only to those directors whom it is practicable to reach 20 16 and may be given in any practicable manner, including by 20 17 publication and radio. 20 18 b. One or more officers of the corporation present at a 20 19 meeting of the board of directors may be deemed to be 20 20 directors for the meeting, in order of rank and within the 20 21 same rank in order of seniority, as necessary to achieve a 20 22 quorum. 20 23 3. Corporate action taken in good faith during an 20 24 emergency under this section to further the ordinary affairs 20 25 of the corporation does both of the following: 20 26 a. Binds the corporation. 20 27 b. Shall not be used to impose liability on a corporate 20 28 director, officer, employee, or agent. 20 29 4. An emergency exists for purposes of this section if a 20 30 quorum of the corporation's directors cannot readily be 20 31 assembled because of some catastrophic event. 20 32 Sec. 29. NEW SECTION. 504A.304 ULTRA VIRES. 20 33 1. Except as provided in subsection 2, the validity of 20 34 corporate action may not be challenged on the ground that the 20 35 corporation lacks or lacked power to act. 21 1 2. A corporation's power to act may be challenged in a 21 2 proceeding against the corporation to enjoin an act where a 21 3 third party has not acquired rights. The proceeding may be 21 4 brought by the attorney general, a director, or by a member or 21 5 members in a derivative proceeding. 21 6 3. A corporation's power to act may be challenged in a 21 7 proceeding against an incumbent or former director, officer, 21 8 employee, or agent of the corporation. The proceeding may be 21 9 brought by a director, the corporation, directly, 21 10 derivatively, or through a receiver, a trustee or other legal 21 11 representative, or in the case of a public benefit 21 12 corporation, by the attorney general. 21 13 SUBCHAPTER IV 21 14 NAMES 21 15 Sec. 30. NEW SECTION. 504A.401 CORPORATE NAME. 21 16 1. A corporate name shall not contain language stating or 21 17 implying that the corporation is organized for a purpose other 21 18 than that permitted by section 504A.301 and its articles of 21 19 incorporation. 21 20 2. Except as authorized by subsections 3 and 4, a 21 21 corporate name must be distinguishable upon the records of the 21 22 secretary of state from: 21 23 a. The corporate name of a nonprofit or business 21 24 corporation incorporated or authorized to do business in this 21 25 state. 21 26 b. A corporate name reserved or registered under section 21 27 490.402, 490.403, 504A.402, or 504A.403. 21 28 c. The fictitious name of a foreign business or nonprofit 21 29 corporation authorized to transact business in this state 21 30 because its real name is unavailable. 21 31 3. A corporation may apply to the secretary of state for 21 32 authorization to use a name that is not distinguishable upon 21 33 the secretary of state's records from one or more of the names 21 34 described in subsection 2. The secretary of state shall 21 35 authorize use of the name applied for if either of the 22 1 following applies: 22 2 a. The other corporation consents to the use in writing 22 3 and submits an undertaking in form satisfactory to the 22 4 secretary of state to change its name to a name that is 22 5 distinguishable upon the records of the secretary of state 22 6 from the name of the applying corporation. 22 7 b. The applicant delivers to the secretary of state a 22 8 certified copy of a final judgment of a court of competent 22 9 jurisdiction establishing the applicant's right to use the 22 10 name applied for in this state. 22 11 4. A corporation may use the name, including the 22 12 fictitious name, of another domestic or foreign business or 22 13 nonprofit corporation that is used in this state if the other 22 14 corporation is incorporated or authorized to do business in 22 15 this state and the proposed user corporation submits 22 16 documentation to the satisfaction of the secretary of state 22 17 establishing any one of the following conditions: 22 18 a. The user corporation has merged with the other 22 19 corporation. 22 20 b. The user corporation has been formed by reorganization 22 21 of the other corporation. 22 22 c. The user corporation has acquired all or substantially 22 23 all of the assets, including the corporate name, of the other 22 24 corporation. 22 25 5. This subchapter does not control the use of fictitious 22 26 names; however, if a corporation or a foreign corporation uses 22 27 a fictitious name in this state it shall deliver to the 22 28 secretary of state for filing a copy of the resolution of its 22 29 board of directors, certified by its secretary, adopting the 22 30 fictitious name. 22 31 Sec. 31. NEW SECTION. 504A.402 RESERVED NAME. 22 32 1. A person may reserve the exclusive use of a corporate 22 33 name, including a fictitious name for a foreign corporation 22 34 whose corporate name is not available by delivering an 22 35 application to the secretary of state for filing. Upon 23 1 finding that the corporate name applied for is available, the 23 2 secretary of state shall reserve the name for the applicant's 23 3 exclusive use for a nonrenewable one hundred twenty-day 23 4 period. 23 5 2. The owner of a reserved corporate name may transfer the 23 6 reservation to another person by delivering to the secretary 23 7 of state a signed notice of the transfer that states the name 23 8 and address of the transferee. 23 9 Sec. 32. NEW SECTION. 504A.403 REGISTERED NAME. 23 10 1. A foreign corporation may register its corporate name, 23 11 or its corporate name with any change required by section 23 12 504A.1506, if the name is distinguishable upon the records of 23 13 the secretary of state from both of the following: 23 14 a. The corporate name of a nonprofit or business 23 15 corporation incorporated or authorized to do business in this 23 16 state. 23 17 b. A corporate name reserved under section 490.402, 23 18 490.403, or 504A.402, or registered under this section. 23 19 2. A foreign corporation registers its corporate name, or 23 20 its corporate name with any change required by section 23 21 504A.1506, by delivering to the secretary of state an 23 22 application providing both of the following: 23 23 a. Setting forth its corporate name, or its corporate name 23 24 with any change required by section 504A.1506, the state or 23 25 country and date of its incorporation, and a brief description 23 26 of the nature of the activities in which it is engaged. 23 27 b. Accompanied by a certificate of existence, or a 23 28 document of similar import, from the state or country of 23 29 incorporation. 23 30 3. The name is registered for the applicant's exclusive 23 31 use upon the effective date of the application. 23 32 4. A foreign corporation whose registration is effective 23 33 may renew it for successive years by delivering to the 23 34 secretary of state for filing a renewal application, which 23 35 complies with the requirements of subsection 2, between 24 1 October 1 and December 31 of the preceding year. The renewal 24 2 application renews the registration for the following calendar 24 3 year. 24 4 5. A foreign corporation whose registration is effective 24 5 may thereafter qualify as a foreign corporation under that 24 6 name or consent in writing to the use of that name by a 24 7 corporation thereafter incorporated under this chapter or by 24 8 another foreign corporation thereafter authorized to transact 24 9 business in this state. The registration terminates when the 24 10 domestic corporation is incorporated or the foreign 24 11 corporation qualifies or consents to the qualification of 24 12 another foreign corporation under the registered name. 24 13 SUBCHAPTER V 24 14 OFFICE AND AGENT 24 15 Sec. 33. NEW SECTION. 504A.501 REGISTERED OFFICE AND 24 16 REGISTERED AGENT. 24 17 Each corporation must continuously maintain both of the 24 18 following in this state: 24 19 1. A registered office with the same address as that of 24 20 the registered agent. 24 21 2. A registered agent, who may be any of the following: 24 22 a. An individual who resides in this state and whose 24 23 business office is identical with the registered office. 24 24 b. A domestic business or nonprofit corporation whose 24 25 business office is identical with the registered office. 24 26 c. A foreign business or nonprofit corporation authorized 24 27 to transact business in this state whose business office is 24 28 identical with the registered office. 24 29 Sec. 34. NEW SECTION. 504A.502 CHANGE OF REGISTERED 24 30 OFFICE OR REGISTERED AGENT. 24 31 1. A corporation may change its registered office or 24 32 registered agent by delivering to the secretary of state for 24 33 filing a statement of change that sets forth all of the 24 34 following: 24 35 a. The name of the corporation. 25 1 b. If the current registered office is to be changed, the 25 2 address of the new registered office. 25 3 c. If the current registered agent is to be changed, the 25 4 name of the new registered agent and the new agent's written 25 5 consent, either on the statement or attached to it, to the 25 6 appointment. 25 7 d. That after the change or changes are made, the 25 8 addresses of its registered office and the office of its 25 9 registered agent will be identical. 25 10 2. If the address of a registered agent's business office 25 11 is changed, the registered agent may change the address of the 25 12 registered office of any corporation for which the registered 25 13 agent is the registered agent by notifying the corporation in 25 14 writing of the change and by signing, either manually or in 25 15 facsimile, and delivering to the secretary of state for filing 25 16 a statement that complies with the requirements of subsection 25 17 1 and recites that the corporation has been notified of the 25 18 change. 25 19 3. If a registered agent changes the registered agent's 25 20 business address to another place, the registered agent may 25 21 change the address of the registered office of any corporation 25 22 for which the registered agent is the registered agent by 25 23 filing a statement as required in subsection 2 for each 25 24 corporation, or by filing a single statement for all 25 25 corporations named in the notice, except that it need be 25 26 signed, either manually or in facsimile, only by the 25 27 registered agent and must recite that a copy of the statement 25 28 has been mailed to each corporation named in the notice. 25 29 Sec. 35. NEW SECTION. 504A.503 RESIGNATION OF REGISTERED 25 30 AGENT. 25 31 1. A registered agent may resign as registered agent by 25 32 signing and delivering to the secretary of state for filing 25 33 the signed original statement of resignation. The statement 25 34 may include a statement that the registered office is also 25 35 discontinued. 26 1 The registered agent shall send a copy of the statement of 26 2 resignation by certified mail to the corporation at its 26 3 principal office and to the registered office, if not 26 4 discontinued. The registered agent shall certify to the 26 5 secretary of state that the copies have been sent to the 26 6 corporation, including the date the copies were sent. 26 7 2. The agency appointment is terminated, and the 26 8 registered office discontinued if so provided, on the date on 26 9 which the statement was filed. 26 10 Sec. 36. NEW SECTION. 504A.504 SERVICE ON CORPORATION. 26 11 1. A corporation's registered agent is the corporation's 26 12 agent for service of process, notice, or demand required or 26 13 permitted by law to be served on the corporation. 26 14 2. If a corporation has no registered agent, or the agent 26 15 cannot with reasonable diligence be served, the corporation 26 16 may be served by registered or certified mail, return receipt 26 17 requested, addressed to the secretary of the corporation at 26 18 its principal office shown in the most recent biennial report 26 19 filed pursuant to section 504A.1613. Service is perfected 26 20 under this subsection on the earliest of any of the following: 26 21 a. The date the corporation receives the mail. 26 22 b. The date shown on the return receipt, if signed on 26 23 behalf of the corporation. 26 24 c. Five days after its deposit in the United States mail, 26 25 if mailed and correctly addressed with first class postage 26 26 affixed. 26 27 3. This section does not prescribe the only means, or 26 28 necessarily the required means, of serving a corporation. A 26 29 corporation may also be served in any other manner permitted 26 30 by law. 26 31 SUBCHAPTER VI 26 32 MEMBERS AND MEMBERSHIPS 26 33 PART 1 26 34 ADMISSION OF MEMBERS 26 35 Sec. 37. NEW SECTION. 504A.601 ADMISSION. 27 1 1. The articles or bylaws may establish criteria or 27 2 procedures for admission of members. 27 3 2. A person shall not be admitted as a member without the 27 4 person's consent or affirmative action evidencing consent. 27 5 Sec. 38. NEW SECTION. 504A.602 CONSIDERATION. 27 6 Except as provided in its articles or bylaws, a corporation 27 7 may admit members for no consideration or for such 27 8 consideration as is determined by the board. 27 9 Sec. 39. NEW SECTION. 504A.603 NO REQUIREMENT OF 27 10 MEMBERS. 27 11 A corporation is not required to have members. 27 12 PART 2 27 13 TYPES OF MEMBERSHIPS – MEMBERS' RIGHTS AND OBLIGATIONS 27 14 Sec. 40. NEW SECTION. 504A.611 DIFFERENCES IN RIGHTS AND 27 15 OBLIGATIONS OF MEMBERS. 27 16 All members shall have the same rights and obligations with 27 17 respect to voting, dissolution, redemption, and transfer, 27 18 unless the articles or bylaws establish classes of membership 27 19 with different rights or obligations. All members shall have 27 20 the same rights and obligations with respect to any other 27 21 matters, except as set forth in or authorized by the articles 27 22 or bylaws. 27 23 Sec. 41. NEW SECTION. 504A.612 TRANSFERS. 27 24 1. Except as set forth in or authorized by the articles or 27 25 bylaws, a member of a mutual benefit corporation shall not 27 26 transfer a membership or any right arising therefrom. 27 27 2. A member of a public benefit or religious corporation 27 28 shall not transfer a membership or any right arising 27 29 therefrom. 27 30 3. Where transfer rights have been provided, a restriction 27 31 on them shall not be binding with respect to a member holding 27 32 a membership issued prior to the adoption of the restriction 27 33 unless the restriction is approved by the members and the 27 34 affected member. 27 35 Sec. 42. NEW SECTION. 504A.613 MEMBER'S LIABILITY TO 28 1 THIRD PARTIES. 28 2 A member of a corporation is not, as such, personally 28 3 liable for the acts, debts, liabilities, or obligations of the 28 4 corporation. 28 5 Sec. 43. NEW SECTION. 504A.614 MEMBER'S LIABILITY FOR 28 6 DUES, ASSESSMENTS, AND FEES. 28 7 A member may become liable to the corporation for dues, 28 8 assessments, or fees. However, an article or bylaw provision 28 9 or a resolution adopted by the board authorizing or imposing 28 10 dues, assessments, or fees does not, of itself, create 28 11 liability. 28 12 Sec. 44. NEW SECTION. 504A.615 CREDITOR'S ACTION AGAINST 28 13 MEMBER. 28 14 1. A proceeding shall not be brought by a creditor to 28 15 reach the liability, if any, of a member to the corporation 28 16 unless final judgment has been rendered in favor of the 28 17 creditor against the corporation and execution has been 28 18 returned unsatisfied in whole or in part or unless such 28 19 proceeding would be useless. 28 20 2. All creditors of the corporation, with or without 28 21 reducing their claims to judgment, may intervene in any 28 22 creditor's proceeding brought under subsection 1 to reach and 28 23 apply unpaid amounts due the corporation. Any or all members 28 24 who owe amounts to the corporation may be joined in such 28 25 proceeding. 28 26 PART 3 28 27 RESIGNATION AND TERMINATION 28 28 Sec. 45. NEW SECTION. 504A.621 RESIGNATION. 28 29 1. A member may resign at any time. 28 30 2. The resignation of a member does not relieve the member 28 31 from any obligations the member may have to the corporation as 28 32 a result of obligations incurred or commitments made prior to 28 33 resignation. 28 34 Sec. 46. NEW SECTION. 504A.622 TERMINATION, EXPULSION, 28 35 OR SUSPENSION. 29 1 1. A member of a public benefit or mutual benefit 29 2 corporation shall not be expelled or suspended, and a 29 3 membership or memberships in such corporations shall not be 29 4 terminated or suspended except pursuant to a procedure which 29 5 is fair and reasonable and is carried out in good faith. 29 6 2. A procedure is fair and reasonable when either of the 29 7 following occurs: 29 8 a. The articles or bylaws set forth a procedure which 29 9 provides both of the following: 29 10 (1) Not less than fifteen days' prior written notice of 29 11 the expulsion, suspension, or termination and the reasons 29 12 therefore. 29 13 (2) An opportunity for the member to be heard, orally or 29 14 in writing, not less than five days before the effective date 29 15 of the expulsion, suspension, or termination by a person or 29 16 persons authorized to decide that the proposed expulsion, 29 17 termination, or suspension not take place. 29 18 b. It is fair and reasonable taking into consideration all 29 19 of the relevant facts and circumstances. 29 20 3. Any written notice given by mail must be given by first 29 21 class or certified mail sent to the last address of the member 29 22 shown on the corporation's records. 29 23 4. Any proceeding challenging an expulsion, suspension, or 29 24 termination, including a proceeding in which defective notice 29 25 is alleged, must be commenced within one year after the 29 26 effective date of the expulsion, suspension, or termination. 29 27 5. A member who has been expelled or suspended may be 29 28 liable to the corporation for dues, assessments or fees as a 29 29 result of obligations incurred or commitments made prior to 29 30 expulsion or suspension. 29 31 Sec. 47. NEW SECTION. 504A.623 PURCHASE OF MEMBERSHIPS. 29 32 1. A public benefit or religious corporation shall not 29 33 purchase any of its memberships or any right arising 29 34 therefrom. 29 35 2. A mutual benefit corporation may purchase the 30 1 membership of a member who resigns or whose membership is 30 2 terminated for the amount and pursuant to the conditions set 30 3 forth in or authorized by its articles or bylaws. A payment 30 4 shall not be made in violation of subchapter 13. 30 5 PART 4 30 6 DERIVATIVE SUITS 30 7 Sec. 48. NEW SECTION. 504A.631 DERIVATIVE SUITS. 30 8 1. A proceeding may be brought in the right of a domestic 30 9 or foreign corporation to procure a judgment in its favor by 30 10 any member or members having five percent or more of the 30 11 voting power or by fifty members, whichever is less, or by any 30 12 director. 30 13 2. In any such proceeding, each complainant shall be a 30 14 member or director at the time of bringing the proceeding. 30 15 3. A complaint in a proceeding brought in the right of a 30 16 corporation must be verified and allege with particularity the 30 17 demand made, if any, to obtain action by the directors and 30 18 either why the complainants could not obtain the action or why 30 19 they did not make the demand. If a demand for action was made 30 20 and the corporation's investigation of the demand is in 30 21 progress when the proceeding is filed, the court may stay the 30 22 suit until the investigation is completed. 30 23 4. On termination of the proceeding, the court may require 30 24 the complainants to pay any defendant's reasonable expenses, 30 25 including counsel fees, incurred in defending the suit if it 30 26 finds that the proceeding was commenced frivolously or in bad 30 27 faith. 30 28 5. If the proceeding on behalf of the corporation results 30 29 in the corporation taking some action requested by the 30 30 complainants or otherwise was successful, in whole or in part, 30 31 or if anything was received by the complainants as the result 30 32 of a judgment, compromise, or settlement of an action or 30 33 claim, the court may award the complainants reasonable 30 34 expenses, including counsel fees. 30 35 6. The complainants shall notify the attorney general 31 1 within ten days after commencing any proceeding under this 31 2 section if the proceeding involves a public benefit 31 3 corporation or assets held in charitable trust by a mutual 31 4 benefit corporation. 31 5 PART 5 31 6 DELEGATES 31 7 Sec. 49. NEW SECTION. 504A.641 DELEGATES. 31 8 1. A corporation may provide in its articles or bylaws for 31 9 delegates having some or all of the authority of members. 31 10 2. The articles or bylaws may set forth provisions 31 11 relating to all of the following: 31 12 a. The characteristics, qualifications, rights, 31 13 limitations, and obligations of delegates including their 31 14 selection and removal. 31 15 b. Calling, noticing, holding, and conducting meetings of 31 16 delegates. 31 17 c. Carrying on corporate activities during and between 31 18 meetings of delegates. 31 19 SUBCHAPTER VII 31 20 MEMBERS' MEETINGS AND VOTING 31 21 PART 1 31 22 MEETINGS AND ACTION WITHOUT MEETINGS 31 23 Sec. 50. NEW SECTION. 504A.701 ANNUAL AND REGULAR 31 24 MEETINGS. 31 25 1. A corporation with members shall hold a membership 31 26 meeting annually at a time stated in or fixed in accordance 31 27 with the bylaws. 31 28 2. A corporation with members may hold regular membership 31 29 meetings at the times stated in or fixed in accordance with 31 30 the bylaws. 31 31 3. Annual and regular membership meetings may be held in 31 32 or out of this state at the place stated in or fixed in 31 33 accordance with the bylaws. If a place is not stated in or 31 34 fixed in accordance with the bylaws, annual and regular 31 35 meetings shall be held at the corporation's principal office. 32 1 4. At the annual meeting all of the following shall occur: 32 2 a. The president and chief financial officer shall report 32 3 on the activities and financial condition of the corporation. 32 4 b. The members shall consider and act upon such other 32 5 matters as may be raised consistent with the notice 32 6 requirements of sections 504A.705 and 504A.714, subsection 2. 32 7 5. At regular meetings, the members shall consider and act 32 8 upon such matters as may be raised consistent with the notice 32 9 requirements of sections 504A.705 and 504A.714, subsection 2. 32 10 6. The failure to hold an annual or regular meeting at a 32 11 time stated in or fixed in accordance with a corporation's 32 12 bylaws does not affect the validity of any corporate action. 32 13 Sec. 51. NEW SECTION. 504A.702 SPECIAL MEETING. 32 14 1. A corporation with members shall hold a special meeting 32 15 of members when either of the following occurs: 32 16 a. On call of its board or the person or persons 32 17 authorized to do so by the articles or bylaws. 32 18 b. Except as provided in the articles or bylaws of a 32 19 religious corporation, if the holders of at least five percent 32 20 of the voting power of any corporation sign, date, and deliver 32 21 to any corporate officer one or more written demands for the 32 22 meeting describing the purpose for which it is to be held. 32 23 2. The close of business on the thirtieth day before 32 24 delivery of the demand for a special meeting to any corporate 32 25 officer is the record date for the purpose of determining 32 26 whether the five percent requirement of subsection 1 has been 32 27 met. 32 28 3. If a notice for a special meeting demanded under 32 29 subsection 1, paragraph "b", is not given pursuant to section 32 30 504A.705 within thirty days after the date the written demand 32 31 or demands are delivered to a corporate officer, regardless of 32 32 the requirements of subsection 4, a person signing the demand 32 33 may set the time and place of the meeting and give notice 32 34 pursuant to section 504A.705. 32 35 4. Special meetings of members may be held in or out of 33 1 this state at the place stated in or fixed in accordance with 33 2 the bylaws. If a place is not stated or fixed in accordance 33 3 with the bylaws, special meetings shall be held at the 33 4 corporation's principal office. 33 5 5. Only those matters that are within the purpose 33 6 described in the meeting notice required by section 504A.705 33 7 may be conducted at a special meeting of members. 33 8 Sec. 52. NEW SECTION. 504A.703 COURT-ORDERED MEETING. 33 9 1. The district court of the county where a corporation's 33 10 principal office is located or, if none is located in this 33 11 state, where its registered office is located, may summarily 33 12 order a meeting to be held when any of the following occurs: 33 13 a. On application of any member or other person entitled 33 14 to participate in an annual or regular meeting, and in the 33 15 case of a public benefit corporation, the attorney general, if 33 16 an annual meeting was not held within the earlier of six 33 17 months after the end of the corporation's fiscal year or 33 18 fifteen months after its last annual meeting. 33 19 b. On application of any member or other person entitled 33 20 to participate in a regular meeting, and in the case of a 33 21 public benefit corporation, the attorney general, if a regular 33 22 meeting is not held within forty days after the date it was 33 23 required to be held. 33 24 c. On application of a member who signed a demand for a 33 25 special meeting valid under section 504A.702, a person 33 26 entitled to call a special meeting, and in the case of a 33 27 public benefit corporation, the attorney general, if any of 33 28 the following applies: 33 29 (1) The notice of the special meeting was not given within 33 30 thirty days after the date the demand was delivered to a 33 31 corporate officer. 33 32 (2) The special meeting was not held in accordance with 33 33 the notice. 33 34 2. The court may fix the time and place of the meeting, 33 35 specify a record date for determining members entitled to 34 1 notice of and to vote at the meeting, prescribe the form and 34 2 content of the meeting notice, fix the quorum required for 34 3 specific matters to be considered at the meeting or direct 34 4 that the votes represented at the meeting constitute a quorum 34 5 for action on those matters, and enter other orders necessary 34 6 to accomplish the purpose of the meeting. 34 7 3. If the court orders a meeting, it may also order the 34 8 corporation to pay the member's costs including reasonable 34 9 counsel fees incurred to obtain the order. 34 10 Sec. 53. NEW SECTION. 504A.704 ACTION BY WRITTEN 34 11 CONSENT. 34 12 1. Unless limited or prohibited by the articles or bylaws, 34 13 action required or permitted by this subchapter to be approved 34 14 by the members may be approved without a meeting of members if 34 15 the action is approved by members holding at least eighty 34 16 percent of the voting power. The action must be evidenced by 34 17 one or more written consents describing the action taken, 34 18 signed by those members representing at least eighty percent 34 19 of the voting power, and delivered to the corporation for 34 20 inclusion in the minutes or filing with the corporate records. 34 21 2. If not otherwise determined under section 504A.703 or 34 22 504A.707, the record date for determining members entitled to 34 23 take action without a meeting is the date the first member 34 24 signs the consent under subsection 1. 34 25 3. A consent signed under this section has the effect of a 34 26 meeting vote and may be described as such in any document 34 27 filed with the secretary of state. 34 28 4. Written notice of member approval pursuant to this 34 29 section shall be given to all members who have not signed the 34 30 written consent. If written notice is required, member 34 31 approval pursuant to this section shall be effective ten days 34 32 after such written notice is given. 34 33 Sec. 54. NEW SECTION. 504A.705 NOTICE OF MEETING. 34 34 1. A corporation shall give notice consistent with its 34 35 bylaws of meetings of members in a fair and reasonable manner. 35 1 2. Any notice which conforms to the requirements of 35 2 subsection 3 is fair and reasonable, but other means of giving 35 3 notice may also be fair and reasonable when all the 35 4 circumstances are considered. However, notice of matters 35 5 referred to in subsection 3, paragraph "b", must be given as 35 6 provided in subsection 3. 35 7 3. Notice is fair and reasonable if all of the following 35 8 occur: 35 9 a. The corporation notifies its members of the place, 35 10 date, and time of each annual, regular, and special meeting of 35 11 members no fewer than ten, or if notice is mailed by other 35 12 than first class or registered mail, no fewer than thirty 35 13 days, however, never more than sixty days before the meeting 35 14 date. 35 15 b. The notice of an annual or regular meeting includes a 35 16 description of any matter or matters which must be approved by 35 17 the members under sections 504A.832, 504A.857, 504A.1003, 35 18 504A.1022, 504A.1104, 504A.1202, 504A.1401, and 504A.1402. 35 19 c. The notice of a special meeting includes a description 35 20 of the matter for which the meeting is called. 35 21 4. Unless the bylaws require otherwise, if an annual, 35 22 regular, or special meeting of members is adjourned to a 35 23 different date, time, or place, notice need not be given of 35 24 the new date, time, or place, if the new date, time, or place 35 25 is announced at the meeting before adjournment. If a new 35 26 record date for the adjourned meeting is or must be fixed 35 27 under section 504A.707, however, notice of the adjourned 35 28 meeting must be given under this section to the members of 35 29 record as of the new record date. 35 30 5. When giving notice of an annual, regular, or special 35 31 meeting of members, a corporation shall give notice of a 35 32 matter a member intends to raise at the meeting if requested 35 33 in writing to do so by a person entitled to call a special 35 34 meeting and the request is received by the secretary or 35 35 president of the corporation at least ten days before the 36 1 corporation gives notice of the meeting. 36 2 Sec. 55. NEW SECTION. 504A.706 WAIVER OF NOTICE. 36 3 1. A member may waive any notice required by this 36 4 subchapter, the articles, or bylaws before or after the date 36 5 and time stated in the notice. The waiver must be in writing, 36 6 be signed by the member entitled to the notice, and be 36 7 delivered to the corporation for inclusion in the minutes or 36 8 filing with the corporate records. 36 9 2. A member's attendance at a meeting does all of the 36 10 following: 36 11 a. Waives objection to lack of notice or defective notice 36 12 of the meeting, unless the member at the beginning of the 36 13 meeting objects to holding the meeting or transacting business 36 14 at the meeting. 36 15 b. Waives objection to consideration of a particular 36 16 matter at the meeting that is not within the purpose described 36 17 in the meeting notice, unless the member objects to 36 18 considering the matter when it is presented. 36 19 Sec. 56. NEW SECTION. 504A.707 RECORD DATE – 36 20 DETERMINING MEMBERS ENTITLED TO NOTICE AND VOTE. 36 21 1. The bylaws of a corporation may fix or provide the 36 22 manner of fixing a date as the record date for determining the 36 23 members entitled to notice of a members' meeting. If the 36 24 bylaws do not fix or provide for fixing such a record date, 36 25 the board may fix a future date as such a record date. If a 36 26 record date is not fixed, members at the close of business on 36 27 the business day preceding the day on which notice is given, 36 28 or if notice is waived, at the close of business on the 36 29 business day preceding the day on which the meeting is held 36 30 are entitled to notice of the meeting. 36 31 2. The bylaws of a corporation may fix or provide the 36 32 manner of fixing a date as the record date for determining the 36 33 members entitled to vote at a members' meeting. If the bylaws 36 34 do not fix or provide for fixing such a record date, the board 36 35 may fix a future date as such a record date. If a record date 37 1 is not fixed, members on the date of the meeting who are 37 2 otherwise eligible to vote are entitled to vote at the 37 3 meeting. 37 4 3. The bylaws may fix or provide the manner for 37 5 determining a date as the record date for the purpose of 37 6 determining the members entitled to exercise any rights in 37 7 respect of any other lawful action. If the bylaws do not fix 37 8 or provide for fixing such a record date, the board may fix in 37 9 advance such a record date. If a record date is not fixed, 37 10 members at the close of business on the day on which the board 37 11 adopts the resolution relating thereto, or the sixtieth day 37 12 prior to the date of such other action, whichever is later, 37 13 are entitled to exercise such rights. 37 14 4. A record date fixed under this section shall not be 37 15 more than seventy days before the meeting or action requiring 37 16 a determination of members occurs. 37 17 5. A determination of members entitled to notice of or to 37 18 vote at a membership meeting is effective for any adjournment 37 19 of the meeting unless the board fixes a new date for 37 20 determining the right to notice or the right to vote, which it 37 21 must do if the meeting is adjourned to a date more than 37 22 seventy days after the record date for determining members 37 23 entitled to notice of the original meeting. 37 24 6. If a court orders a meeting adjourned to a date more 37 25 than one hundred twenty days after the date fixed for the 37 26 original meeting, it may provide that the original record date 37 27 for notice or voting continues in effect or it may fix a new 37 28 record date for notice or voting. 37 29 Sec. 57. NEW SECTION. 504A.708 ACTION BY WRITTEN BALLOT. 37 30 1. Unless prohibited or limited by the articles or bylaws, 37 31 any action which may be taken at any annual, regular, or 37 32 special meeting of members may be taken without a meeting if 37 33 the corporation delivers a written ballot to every member 37 34 entitled to vote on the matter. 37 35 2. A written ballot shall do both of the following: 38 1 a. Set forth each proposed action. 38 2 b. Provide an opportunity to vote for or against each 38 3 proposed action. 38 4 3. Approval by written ballot pursuant to this section 38 5 shall be valid only when the number of votes cast by ballot 38 6 equals or exceeds the quorum required to be present at a 38 7 meeting authorizing the action, and the number of approvals 38 8 equals or exceeds the number of votes that would be required 38 9 to approve the matter at a meeting at which the total number 38 10 of votes cast was the same as the number of votes cast by 38 11 ballot. 38 12 4. All solicitations for votes by written ballot shall do 38 13 all of the following: 38 14 a. Indicate the number of responses needed to meet the 38 15 quorum requirements. 38 16 b. State the percentage of approvals necessary to approve 38 17 each matter other than election of directors. 38 18 c. Specify the time by which a ballot must be received by 38 19 the corporation in order to be counted. 38 20 5. Except as otherwise provided in the articles or bylaws, 38 21 a written ballot shall not be revoked. 38 22 PART 2 38 23 VOTING 38 24 Sec. 58. NEW SECTION. 504A.711 MEMBERS' LIST FOR 38 25 MEETING. 38 26 1. After fixing a record date for a notice of a meeting, a 38 27 corporation shall prepare an alphabetical list of the names of 38 28 all its members who are entitled to notice of the meeting. 38 29 The list must show the address of each member and number of 38 30 votes each member is entitled to vote at the meeting. The 38 31 corporation shall prepare on a current basis through the time 38 32 of the membership meeting a list of members, if any, who are 38 33 entitled to vote at the meeting, but not entitled to notice of 38 34 the meeting. This list shall be prepared on the same basis 38 35 and be part of the list of members. 39 1 2. The list of members must be available for inspection by 39 2 any member for the purpose of communication with other members 39 3 concerning the meeting, beginning two business days after 39 4 notice is given of the meeting for which the list was prepared 39 5 and continuing through the meeting, at the corporation's 39 6 principal office or at a reasonable place identified in the 39 7 meeting notice in the city where the meeting will be held. A 39 8 member, a member's agent, or attorney is entitled on written 39 9 demand to inspect and, subject to the limitations of section 39 10 504A.1602, subsection 3, and section 504A.1605, to copy the 39 11 list, at a reasonable time and at the member's expense, during 39 12 the period it is available for inspection. 39 13 3. The corporation shall make the list of members 39 14 available at the meeting, and any member, a member's agent, or 39 15 attorney is entitled to inspect the list at any time during 39 16 the meeting or any adjournment. 39 17 4. If the corporation refuses to allow a member, a 39 18 member's agent, or attorney to inspect the list of members 39 19 before or at the meeting or copy the list as permitted by 39 20 subsection 2, the district court of the county where a 39 21 corporation's principal office is located or, if none is 39 22 located in this state, where its registered office) is 39 23 located, on application of the member, may summarily order the 39 24 inspection or copying at the corporation's expense and may 39 25 postpone the meeting for which the list was prepared until the 39 26 inspection or copying is complete and may order the 39 27 corporation to pay the member's costs, including reasonable 39 28 counsel fees incurred to obtain the order. 39 29 5. Unless a written demand to inspect and copy a 39 30 membership list has been made under subsection 2 prior to the 39 31 membership meeting and a corporation improperly refuses to 39 32 comply with the demand, refusal or failure to comply with this 39 33 section does not affect the validity of action taken at the 39 34 meeting. 39 35 6. The articles or bylaws of a religious corporation may 40 1 limit or abolish the rights of a member under this section to 40 2 inspect and copy any corporate record. 40 3 Sec. 59. NEW SECTION. 504A.712 VOTING ENTITLEMENT 40 4 GENERALLY. 40 5 1. The right of the members, or any class or classes of 40 6 members, to vote may be limited, enlarged, or denied to the 40 7 extent specified in the articles of incorporation or, if the 40 8 articles of incorporation so provide, by the bylaws. Unless 40 9 so limited, enlarged, or denied, each member, regardless of 40 10 class, shall be entitled to one vote on each matter submitted 40 11 to a vote of members. 40 12 2. Unless the articles or bylaws provide otherwise, if a 40 13 membership stands of record in the names of two or more 40 14 persons, their acts with respect to voting shall have the 40 15 following effect: 40 16 a. If only one votes, such act binds all. 40 17 b. If more than one votes, the vote shall be divided on a 40 18 pro rata basis. 40 19 Sec. 60. NEW SECTION. 504A.713 QUORUM REQUIREMENTS. 40 20 1. Unless this subchapter, the articles, or bylaws provide 40 21 for a higher or lower quorum, ten percent of the votes 40 22 entitled to be cast on a matter must be represented at a 40 23 meeting of members to constitute a quorum on that matter. 40 24 2. A bylaw amendment to decrease the quorum for any member 40 25 action may be approved by the members or, unless prohibited by 40 26 the bylaws, by the board. 40 27 3. A bylaw amendment to increase the quorum required for 40 28 any member action must be approved by the members. 40 29 4. Unless one-third or more of the voting power is present 40 30 in person or by proxy, the only matters that may be voted upon 40 31 at an annual or regular meeting of members are those matters 40 32 that are described in the meeting notice. 40 33 Sec. 61. NEW SECTION. 504A.714 VOTING REQUIREMENTS. 40 34 1. Unless this subchapter, the articles, or the bylaws 40 35 require a greater vote or voting by class, if a quorum is 41 1 present, the affirmative vote of the votes represented and 41 2 voting, which affirmative votes also constitute a majority of 41 3 the required quorum, is the act of the members. 41 4 2. A bylaw amendment to increase or decrease the vote 41 5 required for any member action must be approved by the 41 6 members. 41 7 Sec. 62. NEW SECTION. 504A.715 PROXIES. 41 8 1. Unless the articles or bylaws prohibit or limit proxy 41 9 voting, a member may appoint a proxy to vote or otherwise act 41 10 for the member by signing an appointment form either 41 11 personally or by an attorney in fact. 41 12 2. An appointment of a proxy is effective when received by 41 13 the secretary or other officer or agent authorized to tabulate 41 14 votes. An appointment is valid for eleven months unless a 41 15 different period is expressly provided in the appointment 41 16 form. However, a proxy shall not be valid for more than three 41 17 years from its date of execution. 41 18 3. An appointment of a proxy is revocable by the member. 41 19 4. The death or incapacity of the member appointing a 41 20 proxy does not affect the right of the corporation to accept 41 21 the proxy's authority unless notice of the death or incapacity 41 22 is received by the secretary or other officer or agent 41 23 authorized to tabulate votes before the proxy exercises 41 24 authority under the appointment. 41 25 5. Appointment of a proxy is revoked by the person 41 26 appointing the proxy if either of the following occurs: 41 27 a. The person appointing the proxy attends any meeting and 41 28 votes in person. 41 29 b. The person appointing the proxy signs and delivers to 41 30 the secretary or other officer or agent authorized to tabulate 41 31 proxy votes either a writing stating that the appointment of 41 32 the proxy is revoked or a subsequent appointment form. 41 33 6. Subject to section 504A.718 and any express limitation 41 34 on the proxy's authority appearing on the face of the 41 35 appointment form, a corporation is entitled to accept the 42 1 proxy's vote or other action as that of the member making the 42 2 appointment. 42 3 Sec. 63. NEW SECTION. 504A.716 CUMULATIVE VOTING FOR 42 4 DIRECTORS. 42 5 1. If the articles or bylaws provide for cumulative voting 42 6 by members, members may so vote, by multiplying the number of 42 7 votes the members are entitled to cast by the number of 42 8 directors for whom they are entitled to vote, and cast the 42 9 product for a single candidate or distribute the product among 42 10 two or more candidates. 42 11 2. A director elected by cumulative voting may be removed 42 12 by the members without cause if the requirements of section 42 13 504A.808 are met unless the votes cast against removal, or not 42 14 consenting in writing to such removal, would be sufficient to 42 15 elect such director if voted cumulatively at an election at 42 16 which the same total number of votes were cast or, if such 42 17 action is taken by written ballot, all memberships entitled to 42 18 vote were voted, and the entire number of directors authorized 42 19 at the time of the director's most recent election were then 42 20 being elected. 42 21 3. Members shall not cumulatively vote if the directors 42 22 and members are identical. 42 23 Sec. 64. NEW SECTION. 504A.717 OTHER METHODS OF ELECTING 42 24 DIRECTORS. 42 25 A corporation may provide in its articles or bylaws for 42 26 election of directors by members or delegates on the basis of 42 27 chapter or other organizational unit, by region or other 42 28 geographic unit, by preferential voting, or by any other 42 29 reasonable method. 42 30 Sec. 65. NEW SECTION. 504A.718 CORPORATION'S ACCEPTANCE 42 31 OF VOTES. 42 32 1. If the name signed on a vote, consent, waiver, or proxy 42 33 appointment corresponds to the name of a member, the 42 34 corporation if acting in good faith is entitled to accept the 42 35 vote, consent, waiver, or proxy appointment and give it effect 43 1 as the act of the member. 43 2 2. If the name signed on a vote, consent, waiver, or proxy 43 3 appointment does not correspond to the record name of a 43 4 member, the corporation if acting in good faith is 43 5 nevertheless entitled to accept the vote, consent, waiver, or 43 6 proxy appointment and give it effect as the act of the member 43 7 if any of the following is applicable: 43 8 a. The member is an entity and the name signed purports to 43 9 be that of an officer or agent of the entity. 43 10 b. The name signed purports to be that of an attorney in 43 11 fact of the member and if the corporation requests, evidence 43 12 acceptable to the corporation of the signatory's authority to 43 13 sign for the member has been presented with respect to the 43 14 vote, consent, waiver, or proxy appointment. 43 15 c. Two or more persons hold the membership as cotenants or 43 16 fiduciaries and the name signed purports to be the name of at 43 17 least one of the coholders and the person signing appears to 43 18 be acting on behalf of all the coholders. 43 19 d. In the case of a mutual benefit corporation: 43 20 (1) The name signed purports to be that of an 43 21 administrator, executor, guardian, or conservator representing 43 22 the member and, if the corporation requests, evidence of 43 23 fiduciary status acceptable to the corporation has been 43 24 presented with respect to the vote, consent, waiver, or proxy 43 25 appointment. 43 26 (2) The name signed purports to be that of a receiver or 43 27 trustee in bankruptcy of the member, and, if the corporation 43 28 requests, evidence of this status acceptable to the 43 29 corporation has been presented with respect to the vote, 43 30 consent, waiver, or proxy appointment. 43 31 3. The corporation is entitled to reject a vote, consent, 43 32 waiver, or proxy appointment if the secretary or other officer 43 33 or agent authorized to tabulate votes, acting in good faith, 43 34 has reasonable basis for doubt about the validity of the 43 35 signature on it or about the signatory's authority to sign for 44 1 the member. 44 2 4. The corporation and its officer or agent who accepts or 44 3 rejects a vote, consent, waiver, or proxy appointment in good 44 4 faith and in accordance with the standards of this section are 44 5 not liable in damages to the member for the consequences of 44 6 the acceptance or rejection. 44 7 5. Corporate action based on the acceptance or rejection 44 8 of a vote, consent, waiver, or proxy appointment under this 44 9 section is valid unless a court of competent jurisdiction 44 10 determines otherwise. 44 11 PART 3 44 12 VOTING AGREEMENTS 44 13 Sec. 66. NEW SECTION. 504A.721 VOTING AGREEMENTS. 44 14 1. Two or more members may provide for the manner in which 44 15 they will vote by signing an agreement for that purpose. For 44 16 public benefit corporations, such agreements must have a 44 17 reasonable purpose not inconsistent with the corporation's 44 18 public or charitable purposes. 44 19 2. A voting agreement created under this section is 44 20 specifically enforceable. 44 21 SUBCHAPTER VIII 44 22 DIRECTORS AND OFFICERS 44 23 PART 1 44 24 BOARD OF DIRECTORS 44 25 Sec. 67. NEW SECTION. 504A.801 REQUIREMENT FOR AND 44 26 DUTIES OF BOARD. 44 27 1. Each corporation must have a board of directors. 44 28 2. Except as provided in this subchapter or subsection 3, 44 29 all corporate powers shall be exercised by or under the 44 30 authority of, and the affairs of the corporation managed under 44 31 the direction of, its board. 44 32 3. The articles may authorize a person or persons to 44 33 exercise some or all of the powers which would otherwise be 44 34 exercised by a board. To the extent so authorized, any such 44 35 person or persons shall have the duties and responsibilities 45 1 of the directors, and the directors shall be relieved to that 45 2 extent from such duties and responsibilities. 45 3 Sec. 68. NEW SECTION. 504A.802 QUALIFICATIONS OF 45 4 DIRECTORS. 45 5 All directors must be individuals. The articles or bylaws 45 6 may prescribe other qualifications for directors. 45 7 Sec. 69. NEW SECTION. 504A.803 NUMBER OF DIRECTORS. 45 8 1. A board of directors must consist of one or more 45 9 individuals, with the number specified in or fixed in 45 10 accordance with the articles or bylaws. 45 11 2. The number of directors may be increased or decreased 45 12 from time to time by amendment to or in the manner prescribed 45 13 in the articles or bylaws. 45 14 Sec. 70. NEW SECTION. 504A.804 ELECTION, DESIGNATION, 45 15 AND APPOINTMENT OF DIRECTORS. 45 16 1. If the corporation has members, all the directors, 45 17 except the initial directors, shall be elected at the first 45 18 annual meeting of members, and at each annual meeting 45 19 thereafter, unless the articles or bylaws provide some other 45 20 time or method of election, or provide that some of the 45 21 directors are appointed by some other person or designated. 45 22 2. If the corporation does not have members, all the 45 23 directors, except the initial directors, shall be elected, 45 24 appointed, or designated as provided in the articles or 45 25 bylaws. If no method of designation or appointment is set 45 26 forth in the articles or bylaws, the directors other than the 45 27 initial directors shall be elected by the board. 45 28 Sec. 71. NEW SECTION. 504A.805 TERMS OF DIRECTORS 45 29 GENERALLY. 45 30 1. The articles or bylaws must specify the terms of 45 31 directors. Except for designated or appointed directors, and 45 32 except as otherwise provided in the articles or bylaws, the 45 33 terms of directors shall not exceed five years. In the 45 34 absence of any term specified in the articles or bylaws, the 45 35 term of each director shall be one year. Directors may be 46 1 elected for successive terms. 46 2 2. A decrease in the number of directors or term of office 46 3 does not shorten an incumbent director's term. 46 4 3. Except as provided in the articles or bylaws, both of 46 5 the following apply: 46 6 a. The term of a director filling a vacancy in the office 46 7 of a director elected by members expires at the next election 46 8 of directors by members. 46 9 b. The term of a director filling any other vacancy 46 10 expires at the end of the unexpired term which such director 46 11 is filling. 46 12 4. Despite the expiration of a director's term, the 46 13 director continues to serve until the director's successor is 46 14 elected, designated, or appointed and qualifies, or until 46 15 there is a decrease in the number of directors. 46 16 Sec. 72. NEW SECTION. 504A.806 STAGGERED TERMS FOR 46 17 DIRECTORS. 46 18 The articles or bylaws may provide for staggering the terms 46 19 of directors by dividing the total number of directors into 46 20 groups. The terms of office of the several groups need not be 46 21 uniform. 46 22 Sec. 73. NEW SECTION. 504A.807 RESIGNATION OF DIRECTORS. 46 23 1. A director may resign at any time by delivering written 46 24 notice to the board of directors, its presiding officer, or 46 25 the president or secretary. 46 26 2. A resignation is effective when the notice is effective 46 27 unless the notice specifies a later effective date. If a 46 28 resignation is made effective at a later date, the board may 46 29 fill the pending vacancy before the effective date if the 46 30 board provides that the successor does not take office until 46 31 the effective date. 46 32 Sec. 74. NEW SECTION. 504A.808 REMOVAL OF DIRECTORS 46 33 ELECTED BY MEMBERS OR DIRECTORS. 46 34 1. The members may remove one or more directors elected by 46 35 them without cause. 47 1 2. If a director is elected by a class, chapter, or other 47 2 organizational unit or by region or other geographic grouping, 47 3 the director may be removed only by the members of that class, 47 4 chapter, unit, or grouping. 47 5 3. Except as provided in subsection 9, a director may be 47 6 removed under subsection 1 or 2 only if the number of votes 47 7 cast to remove the director would be sufficient to elect the 47 8 director at a meeting to elect directors. 47 9 4. If cumulative voting is authorized, a director shall 47 10 not be removed if the number of votes, or if the director was 47 11 elected by a class, chapter, unit, or grouping of members, the 47 12 number of votes of that class, chapter, unit, or grouping 47 13 sufficient to elect the director under cumulative voting is 47 14 voted against the director's removal. 47 15 5. A director elected by members may be removed by the 47 16 members only at a meeting called for the purpose of removing 47 17 the director and the meeting notice must state that the 47 18 purpose, or one of the purposes, of the meeting is removal of 47 19 the director. 47 20 6. In computing whether a director is protected from 47 21 removal under subsections 2 through 4, it should be assumed 47 22 that the votes against removal are cast in an election for the 47 23 number of directors of the class to which the director to be 47 24 removed belonged on the date of that director's election. 47 25 7. An entire board of directors may be removed under 47 26 subsections 1 through 5. 47 27 8. A director elected by the board may be removed without 47 28 cause by the vote of two-thirds of the directors then in 47 29 office or such greater number as is set forth in the articles 47 30 or bylaws. However, a director elected by the board to fill 47 31 the vacancy of a director elected by the members may be 47 32 removed without cause by the members, but not by the board. 47 33 9. If at the beginning of a director's term on the board 47 34 the articles or bylaws provide that the director may be 47 35 removed for missing a specified number of board meetings, the 48 1 board may remove the director for failing to attend the 48 2 specified number of meetings. The director may be removed 48 3 only if a majority of the directors then in office votes for 48 4 the removal. 48 5 10. The articles or bylaws of a religious corporation may 48 6 do both of the following: 48 7 a. Limit the application of this section. 48 8 b. Set forth the vote and procedures by which the board or 48 9 any person may remove with or without cause a director elected 48 10 by the members or the board. 48 11 Sec. 75. NEW SECTION. 504A.809 REMOVAL OF DESIGNATED OR 48 12 APPOINTED DIRECTORS. 48 13 1. A designated director may be removed by an amendment to 48 14 the articles or bylaws deleting or changing the designation. 48 15 2. a. Except as otherwise provided in the articles or 48 16 bylaws, an appointed director may be removed without cause by 48 17 the person appointing the director. 48 18 b. The person removing the appointed director shall do so 48 19 by giving written notice of the removal to the director and 48 20 either the presiding officer of the board or the corporation's 48 21 president or secretary. 48 22 c. A removal of an appointed director is effective when 48 23 the notice is effective unless the notice specifies a future 48 24 effective date. 48 25 Sec. 76. NEW SECTION. 504A.810 REMOVAL OF DIRECTORS BY 48 26 JUDICIAL PROCEEDING. 48 27 1. The district court of the county where a corporation's 48 28 principal office is located may remove any director of the 48 29 corporation from office in a proceeding commenced either by 48 30 the corporation, its members holding at least twenty percent 48 31 of the voting power of any class, or the attorney general in 48 32 the case of a public benefit corporation if the court finds 48 33 both of the following: 48 34 a. The director engaged in fraudulent or dishonest conduct 48 35 with respect to the corporation, or a final judgment has been 49 1 entered finding that the director has violated a duty set 49 2 forth in sections 504A.831 through 504A.834. 49 3 b. Removal is in the best interest of the corporation. 49 4 2. The court that removes a director may bar the director 49 5 from serving on the board for a period prescribed by the 49 6 court. 49 7 3. If members or the attorney general commence a 49 8 proceeding under subsection 1, the corporation shall be made a 49 9 party defendant. 49 10 4. If a public benefit corporation or its members commence 49 11 a proceeding under subsection 1, they shall give the attorney 49 12 general written notice of the proceeding. 49 13 5. The articles or bylaws of a religious corporation may 49 14 limit or prohibit the application of this section. 49 15 Sec. 77. NEW SECTION. 504A.811 VACANCY ON BOARD. 49 16 1. Unless the articles or bylaws provide otherwise, and 49 17 except as provided in subsections 2 and 3, if a vacancy occurs 49 18 on a board of directors, including a vacancy resulting from an 49 19 increase in the number of directors, any of the following may 49 20 occur: 49 21 a. The members, if any, may fill the vacancy. If the 49 22 vacant office was held by a director elected by a class, 49 23 chapter, or other organizational unit or by region or other 49 24 geographic grouping, only members of the class, chapter, unit, 49 25 or grouping are entitled to vote to fill the vacancy if it is 49 26 filled by the members. 49 27 b. The board of directors may fill the vacancy. 49 28 c. If the directors remaining in office constitute fewer 49 29 than a quorum of the board, they may fill the vacancy by the 49 30 affirmative vote of a majority of all the directors remaining 49 31 in office. 49 32 2. Unless the articles or bylaws provide otherwise, if a 49 33 vacant office was held by an appointed director, only the 49 34 person who appointed the director may fill the vacancy. 49 35 3. If a vacant office was held by a designated director, 50 1 the vacancy shall be filled as provided in the articles or 50 2 bylaws. In the absence of an applicable article or bylaw 50 3 provision, the vacancy shall not be filled by the board. 50 4 4. A vacancy that will occur at a specific later date by 50 5 reason of a resignation effective at a later date under 50 6 section 504A.807, subsection 2, or otherwise, may be filled 50 7 before the vacancy occurs, but the new director shall not take 50 8 office until the vacancy occurs. 50 9 Sec. 78. NEW SECTION. 504A.812 COMPENSATION OF 50 10 DIRECTORS. 50 11 Unless the articles or bylaws provide otherwise, a board of 50 12 directors may fix the compensation of directors. 50 13 PART 2 50 14 MEETINGS AND ACTION OF THE BOARD 50 15 Sec. 79. NEW SECTION. 504A.821 REGULAR AND SPECIAL 50 16 MEETINGS. 50 17 1. If the time and place of a directors' meeting is fixed 50 18 by the bylaws or the board, the meeting is a regular meeting. 50 19 All other meetings are special meetings. 50 20 2. A board of directors may hold regular or special 50 21 meetings in or out of this state. 50 22 3. Unless the articles or bylaws provide otherwise, a 50 23 board may permit any or all directors to participate in a 50 24 regular or special meeting by, or conduct the meeting through 50 25 the use of, any means of communication by which all directors 50 26 participating may simultaneously hear each other during the 50 27 meeting. A director participating in a meeting by this means 50 28 is deemed to be present in person at the meeting. 50 29 Sec. 80. NEW SECTION. 504A.822 ACTION WITHOUT MEETING. 50 30 1. Unless the articles or bylaws provide otherwise, action 50 31 required or permitted by this subchapter to be taken at a 50 32 board of directors' meeting may be taken without a meeting if 50 33 the action is taken by all members of the board. The action 50 34 must be evidenced by one or more written consents describing 50 35 the action taken, signed by each director, and included in the 51 1 minutes filed with the corporate records reflecting the action 51 2 taken. 51 3 2. Action taken under this section is effective when the 51 4 last director signs the consent, unless the consent specifies 51 5 a different effective date. 51 6 3. A consent signed under this section has the effect of a 51 7 meeting vote and may be described as such in any document. 51 8 Sec. 81. NEW SECTION. 504A.823 CALL AND NOTICE OF 51 9 MEETINGS. 51 10 1. Unless the articles, bylaws, or subsection 3 provide 51 11 otherwise, regular meetings of the board may be held without 51 12 notice. 51 13 2. Unless the articles, bylaws, or subsection 3 provide 51 14 otherwise, special meetings of the board must be preceded by 51 15 at least two days' notice to each director of the date, time, 51 16 and place, but not the purpose, of the meeting. 51 17 3. In corporations without members, any board action to 51 18 remove a director or to approve a matter which would require 51 19 approval by the members if the corporation had members shall 51 20 not be valid unless each director is given at least seven 51 21 days' written notice that the matter will be voted upon at a 51 22 directors' meeting or unless notice is waived pursuant to 51 23 section 504A.824. 51 24 4. Unless the articles or bylaws provide otherwise, the 51 25 presiding officer of the board, the president, or twenty 51 26 percent of the directors then in office may call and give 51 27 notice of a meeting of the board. 51 28 Sec. 82. NEW SECTION. 504A.824 WAIVER OF NOTICE. 51 29 1. A director may at any time waive any notice required by 51 30 this subchapter, the articles, or bylaws. Except as provided 51 31 in subsection 2, the waiver must be in writing, signed by the 51 32 director entitled to the notice, and filed with the minutes or 51 33 the corporate records. 51 34 2. A director's attendance at or participation in a 51 35 meeting waives any required notice of the meeting unless the 52 1 director, upon arriving at the meeting or prior to the vote on 52 2 a matter not noticed in conformity with this subchapter, the 52 3 articles, or bylaws, objects to lack of notice and does not 52 4 thereafter vote for or assent to the objected-to action. 52 5 Sec. 83. NEW SECTION. 504A.825 QUORUM AND VOTING. 52 6 1. Except as otherwise provided in this subchapter, the 52 7 articles, or bylaws, a quorum of a board of directors consists 52 8 of a majority of the directors in office immediately before a 52 9 meeting begins. The articles or bylaws shall not authorize a 52 10 quorum of fewer than one-third of the number of directors in 52 11 office. 52 12 2. If a quorum is present when a vote is taken, the 52 13 affirmative vote of a majority of directors present is the act 52 14 of the board unless this subchapter, the articles, or bylaws 52 15 require the vote of a greater number of directors. 52 16 Sec. 84. NEW SECTION. 504A.826 COMMITTEES OF THE BOARD. 52 17 1. Unless prohibited or limited by the articles or bylaws, 52 18 a board of directors may create one or more committees of the 52 19 board and appoint members of the board to serve on them. Each 52 20 committee shall have two or more directors, who serve at the 52 21 pleasure of the board. 52 22 2. The creation of a committee and appointment of members 52 23 to it must be approved by the greater of either of the 52 24 following: 52 25 a. A majority of all the directors in office when the 52 26 action is taken. 52 27 b. The number of directors required by the articles or 52 28 bylaws to take action under section 504A.825. 52 29 3. Sections 504A.821 through 504A.825, which govern 52 30 meetings, action without meetings, notice and waiver of 52 31 notice, and quorum and voting requirements of the board, apply 52 32 to committees of the board and their members as well. 52 33 4. To the extent specified by the board of directors or in 52 34 the articles or bylaws, each committee of the board may 52 35 exercise the board's authority under section 504A.801. 53 1 5. A committee of the board shall not, however, do any of 53 2 the following: 53 3 a. Authorize distributions. 53 4 b. Approve or recommend to members dissolution, merger, or 53 5 the sale, pledge, or transfer of all or substantially all of 53 6 the corporation's assets. 53 7 c. Elect, appoint, or remove directors or fill vacancies 53 8 on the board or on any of its committees. 53 9 d. Adopt, amend, or repeal the articles or bylaws. 53 10 6. The creation of, delegation of authority to, or action 53 11 by a committee does not alone constitute compliance by a 53 12 director with the standards of conduct described in section 53 13 504A.831. 53 14 PART 3 53 15 STANDARDS OF CONDUCT 53 16 Sec. 85. NEW SECTION. 504A.831 GENERAL STANDARDS FOR 53 17 DIRECTORS. 53 18 1. A director shall discharge the director's duties as a 53 19 director, including the director's duties as a member of a 53 20 committee, in all of the following matters: 53 21 a. In good faith. 53 22 b. With the care an ordinarily prudent person in a like 53 23 position would exercise under similar circumstances. 53 24 c. In a manner the director reasonably believes to be in 53 25 the best interests of the corporation. 53 26 2. In discharging the director's duties, the director is 53 27 entitled to rely on information, opinions, reports, or 53 28 statements, including financial statements and other financial 53 29 data, if prepared or presented by any of the following: 53 30 a. One or more officers or employees of the corporation 53 31 whom the director reasonably believes to be reliable and 53 32 competent in the matters presented. 53 33 b. Legal counsel, public accountants, or other persons as 53 34 to matters the director reasonably believes are within the 53 35 person's professional or expert competence. 54 1 c. A committee of the board of which the director is not a 54 2 member, as to matters within its jurisdiction, if the director 54 3 reasonably believes the committee merits confidence. 54 4 d. In the case of religious corporations, religious 54 5 authorities and ministers, priests, rabbis, or other persons 54 6 whose position or duties in the religious organization the 54 7 director believes justify reliance and confidence and whom the 54 8 director believes to be reliable and competent in the matters 54 9 presented. 54 10 3. A director is not acting in good faith if the director 54 11 has knowledge concerning the matter in question that makes 54 12 reliance otherwise permitted by subsection 2 unwarranted. 54 13 4. A director is not liable to the corporation, any 54 14 member, or any other person for any action taken or not taken 54 15 as a director, if the director acted in compliance with this 54 16 section. 54 17 5. A director shall not be deemed to be a trustee with 54 18 respect to the corporation or with respect to any property 54 19 held or administered by the corporation, including without 54 20 limit, property that may be subject to restrictions imposed by 54 21 the donor or transferor of such property. 54 22 Sec. 86. NEW SECTION. 504A.832 DIRECTOR CONFLICT OF 54 23 INTEREST. 54 24 1. A conflict of interest transaction is a transaction 54 25 with the corporation in which a director of the corporation 54 26 has a direct or indirect interest. A conflict of interest 54 27 transaction is not voidable on the basis for imposing 54 28 liability on the director if the transaction was fair at the 54 29 time it was entered into or is approved as provided in 54 30 subsection 2 or 3. 54 31 2. A transaction in which a director of a public benefit 54 32 or religious corporation has a conflict of interest may be 54 33 approved in either of the following manners: 54 34 a. In advance by the vote of the board of directors or a 54 35 committee of the board if both of the following occur: 55 1 (1) The material facts of the transaction and the 55 2 director's interest are disclosed or known to the board or 55 3 committee of the board. 55 4 (2) The directors approving the transaction in good faith 55 5 reasonably believe that the transaction is fair to the 55 6 corporation. 55 7 b. Before or after the transaction is consummated by 55 8 obtaining approval of either of the following: 55 9 (1) The attorney general. 55 10 (2) The district court in an action in which the attorney 55 11 general is joined as a party. 55 12 3. A transaction in which a director of a mutual benefit 55 13 corporation has a conflict of interest may be approved if 55 14 either of the following occurs: 55 15 a. The material facts of the transaction and the 55 16 director's interest were disclosed or known to the board of 55 17 directors or a committee of the board and the board or 55 18 committee of the board authorized, approved, or ratified the 55 19 transaction. 55 20 b. The material facts of the transaction and the 55 21 director's interest were disclosed or known to the members and 55 22 they authorized, approved, or ratified the transaction. 55 23 4. For the purposes of this section, a director of the 55 24 corporation has an indirect interest in a transaction under 55 25 either of the following circumstances: 55 26 a. If another entity in which the director has a material 55 27 interest or in which the director is a general partner is a 55 28 party to the transaction. 55 29 b. If another entity of which the director is a director, 55 30 officer, or trustee is a party to the transaction. 55 31 5. For purposes of subsections 2 and 3, a conflict of 55 32 interest transaction is authorized, approved, or ratified, if 55 33 it receives the affirmative vote of a majority of the 55 34 directors on the board or on the committee, who have no direct 55 35 or indirect interest in the transaction, but a transaction 56 1 shall not be authorized, approved, or ratified under this 56 2 section by a single director. If a majority of the directors 56 3 on the board who have no direct or indirect interest in the 56 4 transaction vote to authorize, approve, or ratify the 56 5 transaction, a quorum is present for the purpose of taking 56 6 action under this section. The presence of, or a vote cast 56 7 by, a director with a direct or indirect interest in the 56 8 transaction does not affect the validity of any action taken 56 9 under subsection 2, paragraph "a", or subsection 3, paragraph 56 10 "a", if the transaction is otherwise approved as provided in 56 11 subsection 2 or 3. 56 12 6. For purposes of subsection 3, paragraph "b", a conflict 56 13 of interest transaction is authorized, approved, or ratified 56 14 by the members if it receives a majority of the votes entitled 56 15 to be counted under this subsection. Votes cast by or voted 56 16 under the control of a director who has a direct or indirect 56 17 interest in the transaction, and votes cast by or voted under 56 18 the control of an entity described in subsection 4, paragraph 56 19 "a", shall not be counted in a vote of members to determine 56 20 whether to authorize, approve, or ratify a conflict of 56 21 interest transaction under subsection 3, paragraph "b". The 56 22 vote of these members, however, is counted in determining 56 23 whether the transaction is approved under other sections of 56 24 this subchapter. A majority of the voting power, whether or 56 25 not present, that is entitled to be counted in a vote on the 56 26 transaction under this subsection constitutes a quorum for the 56 27 purpose of taking action under this section. 56 28 7. The articles, bylaws, or a resolution of the board may 56 29 impose additional requirements on conflict of interest 56 30 transactions. 56 31 Sec. 87. NEW SECTION. 504A.833 LOANS TO OR GUARANTEES 56 32 FOR DIRECTORS AND OFFICERS. 56 33 1. A corporation shall not lend money to or guarantee the 56 34 obligation of a director or officer of the corporation. 56 35 2. The fact that a loan or guarantee is made in violation 57 1 of this section does not affect the borrower's liability on 57 2 the loan. 57 3 Sec. 88. NEW SECTION. 504A.834 LIABILITY FOR UNLAWFUL 57 4 DISTRIBUTIONS. 57 5 1. Unless a director complies with the applicable 57 6 standards of conduct described in section 504A.831, a director 57 7 who votes for or assents to a distribution made in violation 57 8 of this subchapter is personally liable to the corporation for 57 9 the amount of the distribution that exceeds what could have 57 10 been distributed without violating this subchapter. 57 11 2. A director held liable for an unlawful distribution 57 12 under subsection 1 is entitled to contribution from both of 57 13 the following: 57 14 a. Every other director who voted for or assented to the 57 15 distribution without complying with the applicable standards 57 16 of conduct described in section 504A.831. 57 17 b. Each person who received an unlawful distribution for 57 18 the amount of the distribution whether or not the person 57 19 receiving the distribution knew it was made in violation of 57 20 this subchapter. 57 21 PART 4 57 22 OFFICERS 57 23 Sec. 89. NEW SECTION. 504A.841 REQUIRED OFFICERS. 57 24 1. Unless otherwise provided in the articles or bylaws, a 57 25 corporation shall have a president, a secretary, a treasurer, 57 26 and such other officers as are appointed by the board. 57 27 2. The bylaws or the board shall delegate to one of the 57 28 officers responsibility for preparing minutes of the 57 29 directors' and members' meetings and for authenticating 57 30 records of the corporation. 57 31 3. The same individual may simultaneously hold more than 57 32 one office in a corporation. 57 33 Sec. 90. NEW SECTION. 504A.842 DUTIES AND AUTHORITY OF 57 34 OFFICERS. 57 35 Each officer has the authority and shall perform the duties 58 1 set forth in the bylaws or, to the extent consistent with the 58 2 bylaws, the duties and authority prescribed in a resolution of 58 3 the board or by direction of an officer authorized by the 58 4 board to prescribe the duties and authority of other officers. 58 5 Sec. 91. NEW SECTION. 504A.843 STANDARDS OF CONDUCT FOR 58 6 OFFICERS. 58 7 1. An officer with discretionary authority shall discharge 58 8 the officer's duties under that authority in all of the 58 9 following manners: 58 10 a. In good faith. 58 11 b. With the care an ordinarily prudent person in a like 58 12 position would exercise under similar circumstances. 58 13 c. In a manner the officer reasonably believes to be in 58 14 the best interests of the corporation and its members, if any. 58 15 2. In discharging the officer's duties, an officer is 58 16 entitled to rely on information, opinions, reports, or 58 17 statements, including financial statements and other financial 58 18 data, if prepared or presented by any of the following: 58 19 a. One or more officers or employees of the corporation 58 20 whom the officer reasonably believes to be reliable and 58 21 competent in the matters presented. 58 22 b. Legal counsel, public accountants, or other persons as 58 23 to matters the officer reasonably believes are within the 58 24 person's professional or expert competence. 58 25 c. In the case of religious corporations, religious 58 26 authorities, and ministers, priests, rabbis, or other persons 58 27 whose position or duties in the religious organization the 58 28 officer believes justify reliance and confidence and whom the 58 29 officer believes to be reliable and competent in the matters 58 30 presented. 58 31 3. An officer is not acting in good faith if the officer 58 32 has knowledge concerning the matter in question that makes 58 33 reliance otherwise permitted by subsection 2 unwarranted. 58 34 4. An officer is not liable to the corporation, any 58 35 member, or other person for any action taken or not taken as 59 1 an officer, if the officer acted in compliance with this 59 2 section. 59 3 Sec. 92. NEW SECTION. 504A.844 RESIGNATION AND REMOVAL 59 4 OF OFFICERS. 59 5 1. An officer may resign at any time by delivering notice 59 6 to the corporation. A resignation is effective when the 59 7 notice is effective unless the notice specifies a future 59 8 effective date. If a resignation is made effective at a 59 9 future date and the corporation accepts the future effective 59 10 date, its board of directors may fill the pending vacancy 59 11 before the effective date if the board provides that the 59 12 successor does not take office until the effective date. 59 13 2. A board may remove any officer at any time with or 59 14 without cause. 59 15 Sec. 93. NEW SECTION. 504A.845 CONTRACT RIGHTS OF 59 16 OFFICERS. 59 17 1. The appointment of an officer does not itself create 59 18 contract rights. 59 19 2. An officer's removal does not affect the officer's 59 20 contract rights, if any, with the corporation. An officer's 59 21 resignation does not affect the corporation's contract rights, 59 22 if any, with the officer. 59 23 Sec. 94. NEW SECTION. 504A.846 OFFICERS' AUTHORITY TO 59 24 EXECUTE DOCUMENTS. 59 25 1. Any contract or other instrument in writing executed or 59 26 entered into between a corporation and any other person is not 59 27 invalidated as to the corporation by any lack of authority of 59 28 the signing officers in the absence of actual knowledge on the 59 29 part of the other person that the signing officers had no 59 30 authority to execute the contract or other instrument if it is 59 31 signed by any two officers in category 1 or by one officer in 59 32 category 1 and one officer in category 2 as set out in 59 33 subsection 2. 59 34 2. a. Category 1 officers include the presiding officer 59 35 of the board and the president. 60 1 b. Category 2 officers include a vice president, the 60 2 secretary, treasurer, and executive director. 60 3 PART 5 60 4 INDEMNIFICATION 60 5 Sec. 95. NEW SECTION. 504A.851 DEFINITIONS. 60 6 As used in this part, unless the context otherwise 60 7 requires: 60 8 1. "Corporation" includes any domestic or foreign 60 9 predecessor entity of a corporation in a merger or other 60 10 transaction in which the predecessor's existence ceased upon 60 11 consummation of the transaction. 60 12 2. "Director" means an individual who is or was a director 60 13 of a corporation or an individual who, while a director of a 60 14 corporation, is or was serving at the corporation's request as 60 15 a director, officer, partner, trustee, employee, or agent of 60 16 another foreign or domestic business or nonprofit corporation, 60 17 partnership, joint venture, trust, employee benefit plan, or 60 18 other enterprise. A "director" is considered to be serving an 60 19 employee benefit plan at the corporation's request if the 60 20 director's duties to the corporation also impose duties on, or 60 21 otherwise involve services by, the director to the plan or to 60 22 participants in or beneficiaries of the plan. "Director" 60 23 includes, unless the context otherwise requires, the estate or 60 24 personal representative of a director. 60 25 3. "Expenses" include counsel fees. 60 26 4. "Liability" means the obligation to pay a judgment, 60 27 settlement, penalty, or fine including an excise tax assessed 60 28 with respect to an employee benefit plan, or reasonable 60 29 expenses actually incurred with respect to a proceeding. 60 30 5. "Official capacity" means, when used with respect to a 60 31 director, the office of director in a corporation and when 60 32 used with respect to an individual other than a director, as 60 33 contemplated in section 504A.857, the office in a corporation 60 34 held by the officer or the employment or agency relationship 60 35 undertaken by the employee or agent on behalf of the 61 1 corporation. "Official capacity" does not include service for 61 2 any other foreign or domestic business or nonprofit 61 3 corporation or any partnership joint venture, trust, employee 61 4 benefit plan, or other enterprise. 61 5 6. "Party" includes an individual who was, is, or is 61 6 threatened to be made a named defendant or respondent in a 61 7 proceeding. 61 8 7. "Proceeding" means any threatened, pending, or 61 9 completed action, suit, or proceeding whether civil, criminal, 61 10 administrative, or investigative and whether formal or 61 11 informal. 61 12 Sec. 96. NEW SECTION. 504A.852 AUTHORITY TO INDEMNIFY. 61 13 1. Except as provided in subsection 4, a corporation may 61 14 indemnify an individual made a party to a proceeding because 61 15 the individual is or was a director against liability incurred 61 16 in the proceeding if all of the following apply: 61 17 a. The individual conducted the individual's self in good 61 18 faith. 61 19 b. The individual reasonably believed either of the 61 20 following: 61 21 (1) In the case of conduct in the individual's official 61 22 capacity with the corporation, that the individual's conduct 61 23 was in its best interests. 61 24 (2) In all other cases, that the individual's conduct was 61 25 at least not opposed to its best interests. 61 26 c. The individual, in the case of any criminal proceeding, 61 27 had no reasonable cause to believe the individual's conduct 61 28 was unlawful. 61 29 2. A director's conduct with respect to an employee 61 30 benefit plan for a purpose the director reasonably believed to 61 31 be in the interests of the participants in and beneficiaries 61 32 of the plan is conduct that satisfies the requirements of 61 33 subsection 1, paragraph "b", subparagraph (2). 61 34 3. The termination of a proceeding by judgment, order, 61 35 settlement, conviction, or upon a plea of nolo contendere or 62 1 its equivalent is not, of itself, determinative that the 62 2 director did not meet the standard of conduct described in 62 3 this section. 62 4 4. A corporation shall not indemnify a director under this 62 5 section under either of the following circumstances: 62 6 a. In connection with a proceeding by or in the right of 62 7 the corporation in which the director was adjudged liable to 62 8 the corporation. 62 9 b. In connection with any other proceeding charging 62 10 improper personal benefit to the director, whether or not 62 11 involving action in the director's official capacity, in which 62 12 the director was adjudged liable on the basis that personal 62 13 benefit was improperly received by the director. 62 14 5. Indemnification permitted under this section in 62 15 connection with a proceeding by or in the right of the 62 16 corporation is limited to reasonable expenses incurred in 62 17 connection with the proceeding. 62 18 Sec. 97. NEW SECTION. 504A.853 MANDATORY 62 19 INDEMNIFICATION. 62 20 Unless limited by its articles of incorporation, a 62 21 corporation shall indemnify a director who was wholly 62 22 successful, on the merits or otherwise, in the defense of any 62 23 proceeding to which the director was a party because the 62 24 director is or was a director of the corporation against 62 25 reasonable expenses actually incurred by the director in 62 26 connection with the proceeding. 62 27 Sec. 98. NEW SECTION. 504A.854 ADVANCE FOR EXPENSES. 62 28 1. A corporation may pay for or reimburse the reasonable 62 29 expenses incurred by a director who is a party to a proceeding 62 30 in advance of final disposition of the proceeding if all of 62 31 the following apply: 62 32 a. The director furnishes the corporation a written 62 33 affirmation of the director's good faith belief that the 62 34 director has met the standard of conduct described in section 62 35 504A.852. 63 1 b. The director furnishes the corporation a written 63 2 undertaking, executed personally or on the director's behalf, 63 3 to repay the advance if it is ultimately determined that the 63 4 director did not meet the standard of conduct. 63 5 c. A determination is made that the facts then known to 63 6 those making the determination would not preclude 63 7 indemnification under this part. 63 8 2. The undertaking required by subsection 1, paragraph 63 9 "b", must be an unlimited general obligation of the director 63 10 but need not be secured and may be accepted without reference 63 11 to financial ability to make repayment. 63 12 3. Determinations and authorizations of payments under 63 13 this section shall be made in the manner specified in section 63 14 504A.856. 63 15 Sec. 99. NEW SECTION. 504A.855 COURT-ORDERED 63 16 INDEMNIFICATION. 63 17 Unless limited by a corporation's articles of 63 18 incorporation, a director of the corporation who is a party to 63 19 a proceeding may apply for indemnification to the court 63 20 conducting the proceeding or to another court of competent 63 21 jurisdiction. On receipt of an application, the court after 63 22 giving any notice the court considers necessary may order 63 23 indemnification in the amount it considers proper if it 63 24 determines either of the following applies: 63 25 1. The director is entitled to mandatory indemnification 63 26 under section 504A.853, in which case the court shall also 63 27 order the corporation to pay the director's reasonable 63 28 expenses incurred to obtain court-ordered indemnification. 63 29 2. The director is fairly and reasonably entitled to 63 30 indemnification in view of all the relevant circumstances, 63 31 whether or not the director met the standard of conduct set 63 32 forth in section 504A.852, subsection 1, or was adjudged 63 33 liable as described in section 504A.852, subsection 4, but if 63 34 the director was adjudged so liable indemnification is limited 63 35 to reasonable expenses incurred. 64 1 Sec. 100. NEW SECTION. 504A.856 DETERMINATION AND 64 2 AUTHORIZATION OF INDEMNIFICATION. 64 3 1. A corporation shall not indemnify a director under 64 4 section 504A.852 unless authorized in the specific case after 64 5 a determination has been made that indemnification of the 64 6 director is permissible in the circumstances because the 64 7 director has met the standard of conduct set forth in section 64 8 504A.852. 64 9 2. The determination shall be made by one of the 64 10 following: 64 11 a. By the board of directors by majority vote of a quorum 64 12 consisting of directors not at the time parties to the 64 13 proceeding. 64 14 b. If a quorum cannot be obtained under paragraph "a", by 64 15 majority vote of a committee duly designated by the board of 64 16 directors in which designation directors who are parties may 64 17 participate, consisting solely of two or more directors not at 64 18 the time parties to the proceeding. 64 19 c. By special legal counsel under one of the following 64 20 circumstances: 64 21 (1) Selected by the board of directors or its committee in 64 22 the manner prescribed in paragraph "a" or "b". 64 23 (2) If a quorum of the board cannot be obtained under 64 24 paragraph "a" and a committee cannot be designated under 64 25 paragraph "b", selected by majority vote of the full board in 64 26 which selection directors who are parties may participate. 64 27 d. By the members of a mutual benefit corporation, but 64 28 directors who are at the time parties to the proceeding shall 64 29 not vote on the determination. 64 30 3. Authorization of indemnification and evaluation as to 64 31 reasonableness of expenses shall be made in the same manner as 64 32 the determination that indemnification is permissible, except 64 33 that if the determination is made by special legal counsel, 64 34 authorization of indemnification and evaluation as to 64 35 reasonableness of expenses shall be made by those entitled 65 1 under subsection 2, paragraph "c", to select counsel. 65 2 4. A director of a public benefit corporation shall not be 65 3 indemnified until twenty days after the effective date of 65 4 written notice to the attorney general of the proposed 65 5 indemnification. 65 6 Sec. 101. NEW SECTION. 504A.857 INDEMNIFICATION OF 65 7 OFFICERS, EMPLOYEES, AND AGENTS. 65 8 Unless limited by a corporation's articles of 65 9 incorporation: 65 10 1. An officer of the corporation who is not a director is 65 11 entitled to mandatory indemnification under section 504A.853, 65 12 and is entitled to apply for court-ordered indemnification 65 13 under section 504A.855 in each case, to the same extent as a 65 14 director. 65 15 2. The corporation may indemnify and advance expenses 65 16 under this part to an officer, employee, or agent of the 65 17 corporation who is not a director to the same extent as to a 65 18 director. 65 19 3. A corporation may also indemnify and advance expenses 65 20 to an officer, employee, or agent who is not a director to the 65 21 extent, consistent with public policy, that may be provided by 65 22 its articles of incorporation, bylaws, general or specific 65 23 action of its board of directors, or contract. 65 24 Sec. 102. NEW SECTION. 504A.858 INSURANCE. 65 25 A corporation may purchase and maintain insurance on behalf 65 26 of an individual who is or was a director, officer, employee, 65 27 or agent of the corporation, or who, while a director, 65 28 officer, employee, or agent of the corporation, is or was 65 29 serving at the request of the corporation as a director, 65 30 officer, partner, trustee, employee, or agent of another 65 31 foreign or domestic business or nonprofit corporation, 65 32 partnership, joint venture, trust, employee benefit plan, or 65 33 other enterprise, against liability asserted against or 65 34 incurred by the individual in that capacity or arising from 65 35 the individual's status as a director, officer, employee, or 66 1 agent, whether or not the corporation would have power to 66 2 indemnify the individual against the same liability under 66 3 section 504A.852 or 504A.853. 66 4 Sec. 103. NEW SECTION. 504A.859 APPLICATION OF PART. 66 5 1. A provision treating a corporation's indemnification of 66 6 or advance for expenses to directors that is contained in its 66 7 articles of incorporation, bylaws, a resolution of its members 66 8 or board of directors, or in a contract or otherwise, is valid 66 9 only if and to the extent the provision is consistent with 66 10 this part. If articles of incorporation limit indemnification 66 11 or advance for expenses, indemnification and advance for 66 12 expenses are valid only to the extent consistent with the 66 13 articles. 66 14 2. This part does not limit a corporation's power to pay 66 15 or reimburse expenses incurred by a director in connection 66 16 with appearing as a witness in a proceeding at a time when the 66 17 director has not been made a named defendant or respondent to 66 18 the proceeding. 66 19 SUBCHAPTER IX 66 20 PERSONAL LIABILITY 66 21 Sec. 104. NEW SECTION. 504A.901 PERSONAL LIABILITY. 66 22 Except as otherwise provided in this chapter, a director, 66 23 officer, employee, or member of the corporation is not liable 66 24 on the corporation's debts or obligations and a director, 66 25 officer, member, or volunteer is not personally liable in that 66 26 capacity, for a claim based upon an act or omission of the 66 27 person performed in the discharge of the person's duties, 66 28 except for a breach of the duty of loyalty to the corporation, 66 29 for acts or omissions not in good faith or which involve 66 30 intentional misconduct or knowing violation of the law, or for 66 31 a transaction from which the person derives an improper 66 32 personal benefit. 66 33 SUBCHAPTER X 66 34 AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS 66 35 PART 1 67 1 ARTICLES OF INCORPORATION 67 2 Sec. 105. NEW SECTION. 504A.1001 AUTHORITY TO AMEND. 67 3 A corporation may amend its articles of incorporation at 67 4 any time to add or change a provision that is required or 67 5 permitted in the articles or to delete a provision not 67 6 required in the articles. Whether a provision is required or 67 7 permitted in the articles is determined as of the effective 67 8 date of the amendment. 67 9 Sec. 106. NEW SECTION. 504A.1002 AMENDMENT BY DIRECTORS. 67 10 1. Unless the articles provide otherwise, a corporation's 67 11 board of directors may adopt one or more amendments to the 67 12 corporation's articles without member approval to do any of 67 13 the following: 67 14 a. Extend the duration of the corporation if it was 67 15 incorporated at a time when limited duration was required by 67 16 law. 67 17 b. Delete the names and addresses of the initial 67 18 directors. 67 19 c. Delete the name and address of the initial registered 67 20 agent or registered office, if a statement of change is on 67 21 file with the secretary of state. 67 22 d. Change the corporate name by substituting the word 67 23 "corporation", "incorporated", "company", "limited", or the 67 24 abbreviation "corp.", "inc.", "co.", or "ltd.", for a similar 67 25 word or abbreviation in the name, or by adding, deleting, or 67 26 changing a geographical attribution to the name. 67 27 e. Make any other change expressly permitted by this 67 28 subchapter to be made by director action. 67 29 2. If a corporation has no members, its incorporators, 67 30 until directors have been chosen, and thereafter its board of 67 31 directors, may adopt one or more amendments to the 67 32 corporation's articles subject to any approval required 67 33 pursuant to section 504A.1031. The corporation shall provide 67 34 notice of any meeting at which an amendment is to be voted 67 35 upon. The notice shall be in accordance with section 68 1 504A.823, subsection 3. The notice must also state that the 68 2 purpose, or one of the purposes, of the meeting is to consider 68 3 a proposed amendment to the articles and contain or be 68 4 accompanied by a copy or summary of the amendment or state the 68 5 general nature of the amendment. The amendment must be 68 6 approved by a majority of the directors in office at the time 68 7 the amendment is adopted. 68 8 Sec. 107. NEW SECTION. 504A.1003 AMENDMENT BY DIRECTORS 68 9 AND MEMBERS. 68 10 1. Unless this chapter, the articles, bylaws, the members 68 11 acting pursuant to subsection 2, or the board of directors 68 12 acting pursuant to subsection 3, require a greater vote or 68 13 voting by class, an amendment to a corporation's articles to 68 14 be adopted must be approved by all of the following: 68 15 a. By the board if the corporation is a public benefit or 68 16 religious corporation and the amendment does not relate to the 68 17 number of directors, the composition of the board, the term of 68 18 office of directors, or the method or way in which directors 68 19 are elected or selected. 68 20 b. Except as provided in section 504A.1002, subsection 1, 68 21 by the members of two-thirds of the votes cast or a majority 68 22 of the voting power that could be cast, whichever is less. 68 23 c. In writing by any person or persons whose approval is 68 24 required by a provision of the articles authorized by section 68 25 504A.1031. 68 26 2. The members may condition the adoption of the amendment 68 27 on receipt of a higher percentage of affirmative votes or on 68 28 any other basis. 68 29 3. If the board initiates an amendment to the articles or 68 30 board approval is required by subsection 1 to adopt an 68 31 amendment to the articles, the board may condition the 68 32 amendment's adoption on receipt of a higher percentage of 68 33 affirmative votes or any other basis. 68 34 4. If the board or the members seek to have the amendment 68 35 approved by the members at a membership meeting, the 69 1 corporation shall give notice to its members of the proposed 69 2 membership meeting in writing in accordance with section 69 3 504A.705. The notice must state that the purpose, or one of 69 4 the purposes, of the meeting is to consider the proposed 69 5 amendment and contain or be accompanied by a copy or summary 69 6 of the amendment. 69 7 5. If the board or the members seek to have the amendment 69 8 approved by the members by written consent or written ballot, 69 9 the material soliciting the approval shall contain or be 69 10 accompanied by a copy or summary of the amendment. 69 11 Sec. 108. NEW SECTION. 504A.1004 CLASS VOTING BY MEMBERS 69 12 ON AMENDMENTS. 69 13 1. The members of a class in a public benefit corporation 69 14 are entitled to vote as a class on a proposed amendment to the 69 15 articles if the amendment would change the rights of that 69 16 class as to voting in a manner different than such amendment 69 17 affects another class or members of another class. 69 18 2. The members of a class in a mutual benefit corporation 69 19 are entitled to vote as a class on a proposed amendment to the 69 20 articles if the amendment would do any of the following: 69 21 a. Affect the rights, privileges, preferences, 69 22 restrictions, or conditions of that class as to voting, 69 23 dissolution, redemption, or transfer of memberships in a 69 24 manner different than such amendment would affect another 69 25 class. 69 26 b. Change the rights, privileges, preferences, 69 27 restrictions, or conditions of that class as to voting, 69 28 dissolution, redemption, or transfer by changing the rights, 69 29 privileges, preferences, restrictions, or conditions of 69 30 another class. 69 31 c. Increase or decrease the number of memberships 69 32 authorized for that class. 69 33 d. Increase the number of memberships authorized for 69 34 another class. 69 35 e. Effect an exchange, reclassification, or termination of 70 1 the memberships of that class. 70 2 f. Authorize a new class of memberships. 70 3 3. The members of a class of a religious corporation are 70 4 entitled to vote as a class on a proposed amendment to the 70 5 articles only if a class vote is provided for in the articles 70 6 or bylaws. 70 7 4. If a class is to be divided into two or more classes as 70 8 a result of an amendment to the articles of a public benefit 70 9 or mutual benefit corporation, the amendment must be approved 70 10 by the members of each class that would be created by the 70 11 amendment. 70 12 5. Except as provided in the articles or bylaws of a 70 13 religious corporation, if a class vote is required to approve 70 14 an amendment to the articles of a corporation, the amendment 70 15 must be approved by the members of the class by two-thirds of 70 16 the votes cast by the class or a majority of the voting power 70 17 of the class, whichever is less. 70 18 6. A class of members of a public benefit or mutual 70 19 benefit corporation is entitled to the voting rights granted 70 20 by this section although the articles and bylaws provide that 70 21 the class shall not vote on the proposed amendment. 70 22 Sec. 109. NEW SECTION. 504A.1005 ARTICLES OF AMENDMENT. 70 23 A corporation amending its articles shall deliver to the 70 24 secretary of state articles of amendment setting forth: 70 25 1. The name of the corporation. 70 26 2. The text of each amendment adopted. 70 27 3. The date of each amendment's adoption. 70 28 4. If approval of members was not required, a statement to 70 29 that effect and a statement that the amendment was approved by 70 30 a sufficient vote of the board of directors or incorporators. 70 31 5. If approval by members was required, both of the 70 32 following: 70 33 a. The designation, number of memberships outstanding, 70 34 number of votes entitled to be cast by each class entitled to 70 35 vote separately on the amendment, and number of votes of each 71 1 class indisputably voting on the amendment. 71 2 b. Either the total number of votes cast for and against 71 3 the amendment by each class entitled to vote separately on the 71 4 amendment or the total number of undisputed votes cast for the 71 5 amendment by each class and a statement that the number cast 71 6 for the amendment by each class was sufficient for approval by 71 7 that class. 71 8 6. If approval of the amendment by some person or persons 71 9 other than the members, the board, or the incorporators is 71 10 required pursuant to section 504A.1031, a statement that the 71 11 approval was obtained. 71 12 Sec. 110. NEW SECTION. 504A.1006 RESTATED ARTICLES OF 71 13 INCORPORATION. 71 14 1. A corporation's board of directors may restate its 71 15 articles of incorporation at any time with or without approval 71 16 by members or any other person. 71 17 2. The restatement may include one or more amendments to 71 18 the articles. If the restatement includes an amendment 71 19 requiring approval by the members or any other person, it must 71 20 be adopted as provided in section 504A.1003. 71 21 3. If the restatement includes an amendment requiring 71 22 approval by members, the board must submit the restatement to 71 23 the members for their approval. 71 24 4. If the board seeks to have the restatement approved by 71 25 the members at a membership meeting, the corporation shall 71 26 notify each of its members of the proposed membership meeting 71 27 in writing in accordance with section 504A.705. The notice 71 28 must also state that the purpose, or one of the purposes, of 71 29 the meeting is to consider the proposed restatement and 71 30 contain or be accompanied by a copy or summary of the 71 31 restatement that identifies any amendments or other change it 71 32 would make in the articles. 71 33 5. If the board seeks to have the restatement approved by 71 34 the members by written ballot or written consent, the material 71 35 soliciting the approval shall contain or be accompanied by a 72 1 copy or summary of the restatement that identifies any 72 2 amendments or other change it would make in the articles. 72 3 6. A restatement requiring approval by the members must be 72 4 approved by the same vote as an amendment to articles under 72 5 section 504A.1003. 72 6 7. If the restatement includes an amendment requiring 72 7 approval pursuant to section 504A.1031, the board must submit 72 8 the restatement for such approval. 72 9 8. A corporation restating its articles shall deliver to 72 10 the secretary of state articles of restatement setting forth 72 11 the name of the corporation and the text of the restated 72 12 articles of incorporation together with a certificate setting 72 13 forth all of the following: 72 14 a. Whether the restatement contains an amendment to the 72 15 articles requiring approval by the members or any other person 72 16 other than the board of directors and, if it does not, that 72 17 the board of directors adopted the restatement. 72 18 b. If the restatement contains an amendment to the 72 19 articles requiring approval by the members, the information 72 20 required by section 504A.1005. 72 21 c. If the restatement contains an amendment to the 72 22 articles requiring approval by a person whose approval is 72 23 required pursuant to section 504A.1031, a statement that such 72 24 approval was obtained. 72 25 9. Duly adopted restated articles of incorporation 72 26 supersede the original articles of incorporation and all 72 27 amendments to them. 72 28 10. The secretary of state may certify restated articles 72 29 of incorporation, as the articles of incorporation currently 72 30 in effect, without including the certificate information 72 31 required by subsection 8. 72 32 Sec. 111. NEW SECTION. 504A.1007 AMENDMENT PURSUANT TO 72 33 JUDICIAL REORGANIZATION. 72 34 1. A corporation's articles may be amended without board 72 35 approval or approval by the members or approval required 73 1 pursuant to section 504A.1031 to carry out a plan of 73 2 reorganization ordered or decreed by a court of competent 73 3 jurisdiction under federal statute if the articles after 73 4 amendment contain only provisions required or permitted by 73 5 section 504A.202. 73 6 2. The individual or individuals designated by the court 73 7 shall deliver to the secretary of state articles of amendment 73 8 setting forth all of the following: 73 9 a. The name of the corporation. 73 10 b. The text of each amendment approved by the court. 73 11 c. The date of the court's order or decree approving the 73 12 articles of amendment. 73 13 d. The title of the reorganization proceeding in which the 73 14 order or decree was entered. 73 15 e. A statement that the court had jurisdiction of the 73 16 proceeding under federal statute. 73 17 3. This section does not apply after entry of a final 73 18 decree in the reorganization proceeding even though the court 73 19 retains jurisdiction of the proceeding for limited purposes 73 20 unrelated to consummation of the reorganization plan. 73 21 Sec. 112. NEW SECTION. 504A.1008 EFFECT OF AMENDMENT AND 73 22 RESTATEMENT. 73 23 An amendment to articles of incorporation does not affect a 73 24 cause of action existing against or in favor of the 73 25 corporation, a proceeding to which the corporation is a party, 73 26 any requirement or limitation imposed upon the corporation or 73 27 any property held by it by virtue of any trust upon which such 73 28 property is held by the corporation or the existing rights of 73 29 persons other than members of the corporation. An amendment 73 30 changing a corporation's name does not abate a proceeding 73 31 brought by or against the corporation in its former name. 73 32 PART 2 73 33 BYLAWS 73 34 Sec. 113. NEW SECTION. 504A.1021 AMENDMENT BY DIRECTORS. 73 35 If a corporation has no members, its incorporators, until 74 1 directors have been chosen, and thereafter its board of 74 2 directors, may adopt one or more amendments to the 74 3 corporation's bylaws subject to any approval required pursuant 74 4 to section 504A.1031. The corporation shall provide notice of 74 5 any meeting of directors at which an amendment is to be 74 6 approved. The notice must be given in accordance with section 74 7 504A.823, subsection 3. The notice must also state that the 74 8 purpose, or one of the purposes, of the meeting is to consider 74 9 a proposed amendment to the bylaws and contain or be 74 10 accompanied by a copy or summary of the amendment or state the 74 11 general nature of the amendment. The amendment must be 74 12 approved by a majority of the directors in office at the time 74 13 the amendment is adopted. 74 14 Sec. 114. NEW SECTION. 504A.1022 AMENDMENT BY DIRECTORS 74 15 AND MEMBERS. 74 16 1. Unless this chapter, the articles, bylaws, the members 74 17 acting pursuant to subsection 2, or the board of directors 74 18 acting pursuant to subsection 3, require a greater vote or 74 19 voting by class, an amendment to a corporation's bylaws to be 74 20 adopted must be approved by all of the following: 74 21 a. By the board if the corporation is a public benefit or 74 22 religious corporation and the amendment does not relate to the 74 23 number of directors, the composition of the board, the term of 74 24 office of directors, or the method or way in which directors 74 25 are elected or selected. 74 26 b. By the members by two-thirds of the votes cast or a 74 27 majority of the voting power, whichever is less. 74 28 c. In writing by any person or persons whose approval is 74 29 required by a provision of the articles authorized by section 74 30 504A.1031. 74 31 2. The members may condition the amendment's adoption on 74 32 its receipt of a higher percentage of affirmative votes or on 74 33 any other basis. 74 34 3. If the board initiates an amendment to the bylaws or 74 35 board approval is required by subsection 1 to adopt an 75 1 amendment to the bylaws, the board may condition the 75 2 amendment's adoption on receipt of a higher percentage of 75 3 affirmative votes or on any other basis. 75 4 4. If the board or the members seek to have the amendment 75 5 approved by the members at a membership meeting, the 75 6 corporation shall give notice to its members of the proposed 75 7 membership meeting in writing in accordance with section 75 8 504A.705. The notice must also state that the purpose, or one 75 9 of the purposes, of the meeting is to consider the proposed 75 10 amendment and contain or be accompanied by a copy or summary 75 11 of the amendment. 75 12 5. If the board or the members seek to have the amendment 75 13 approved by the members by written consent or written ballot, 75 14 the material soliciting the approval shall contain or be 75 15 accompanied by a copy or summary of the amendment. 75 16 Sec. 115. NEW SECTION. 504A.1023 CLASS VOTING BY MEMBERS 75 17 ON AMENDMENTS. 75 18 1. The members of a class in a public benefit corporation 75 19 are entitled to vote as a class on a proposed amendment to the 75 20 bylaws if the amendment would change the rights of that class 75 21 as to voting in a manner different than such amendment affects 75 22 another class or members of another class. 75 23 2. The members of a class in a mutual benefit corporation 75 24 are entitled to vote as a class on a proposed amendment to the 75 25 bylaws if the amendment would do any of the following: 75 26 a. Affect the rights, privileges, preferences, 75 27 restrictions, or conditions of that class as to voting, 75 28 dissolution, redemption, or transfer of memberships in a 75 29 manner different than such amendment would affect another 75 30 class. 75 31 b. Change the rights, privileges, preferences, 75 32 restrictions, or conditions of that class as to voting, 75 33 dissolution, redemption, or transfer by changing the rights, 75 34 privileges, preferences, restrictions, or conditions of 75 35 another class. 76 1 c. Increase or decrease the number of memberships 76 2 authorized for that class. 76 3 d. Increase the number of memberships authorized for 76 4 another class. 76 5 e. Effect an exchange, reclassification, or termination of 76 6 all or part of the memberships of that class. 76 7 f. Authorize a new class of memberships. 76 8 3. The members of a class of a religious corporation are 76 9 entitled to vote as a class on a proposed amendment to the 76 10 bylaws only if a class vote is provided for in the articles or 76 11 bylaws. 76 12 4. If a class is to be divided into two or more classes as 76 13 a result of an amendment to the bylaws, the amendment must be 76 14 approved by the members of each class that would be created by 76 15 the amendment. 76 16 5. If a class vote is required to approve an amendment to 76 17 the bylaws, the amendment must be approved by the members of 76 18 the class by two-thirds of the votes cast by the class or a 76 19 majority of the voting power of the class, whichever is less. 76 20 6. A class of members is entitled to the voting rights 76 21 granted by this section although the articles and bylaws 76 22 provide that the class may not vote on the proposed amendment. 76 23 PART 3 76 24 ARTICLES OF INCORPORATION AND BYLAWS 76 25 Sec. 116. NEW SECTION. 504A.1031 APPROVAL BY THIRD 76 26 PERSONS. 76 27 The articles may require an amendment to the articles or 76 28 bylaws to be approved in writing by a specified person or 76 29 persons other than the board. Such an article provision may 76 30 only be amended with the approval in writing of such person or 76 31 persons. 76 32 Sec. 117. NEW SECTION. 504A.1032 AMENDMENT TERMINATING 76 33 MEMBERS OR REDEEMING OR CANCELING MEMBERSHIPS. 76 34 1. Any amendment to the articles or bylaws of a public 76 35 benefit or mutual benefit corporation which would terminate 77 1 all members or any class of members or redeem or cancel all 77 2 memberships or any class of memberships must meet the 77 3 requirements of this chapter and this section. 77 4 2. Before adopting a resolution proposing such an 77 5 amendment, the board of a mutual benefit corporation shall 77 6 give notice of the general nature of the amendment to the 77 7 members. 77 8 3. After adopting a resolution proposing such an 77 9 amendment, the notice to members proposing such amendment 77 10 shall include one statement of up to five hundred words 77 11 opposing the proposed amendment if such statement is submitted 77 12 by any five members or members having three percent or more of 77 13 the voting power, whichever is less, not later than twenty 77 14 days after the board has voted to submit such amendment to the 77 15 members for their approval. In public benefit corporations, 77 16 the production and mailing costs shall be paid by the 77 17 requesting members. In mutual benefit corporations, the 77 18 production and mailing costs shall be paid by the corporation. 77 19 4. Any such amendment shall be approved by the members by 77 20 two-thirds of the votes cast by each class. 77 21 5. The provisions of section 504A.622 shall not apply to 77 22 any amendment meeting the requirements of the chapter and this 77 23 section. 77 24 SUBCHAPTER XI 77 25 MERGER 77 26 Sec. 118. NEW SECTION. 504A.1101 APPROVAL OF PLAN OF 77 27 MERGER. 77 28 1. Subject to the limitations set forth in section 77 29 504A.1102, one or more nonprofit corporations may merge with 77 30 or into any one or more corporation or nonprofit corporation 77 31 or limited liability company, if the plan of merger is 77 32 approved as provided in section 504A.1103. 77 33 2. The plan of merger shall set forth all of the 77 34 following: 77 35 a. The name of each corporation or limited liability 78 1 company planning to merge and the name of the surviving 78 2 corporation into which each plans to merge. 78 3 b. The terms and conditions of the planned merger. 78 4 c. The manner and basis, if any, of converting the 78 5 memberships of each public benefit or religious corporation 78 6 into memberships of the surviving corporation or limited 78 7 liability company. 78 8 d. If the merger involves a mutual benefit corporation, 78 9 the manner and basis, if any, of converting memberships of 78 10 each merging corporation into memberships, obligations, or 78 11 securities of the surviving or any other corporation or 78 12 limited liability company or into cash or other property in 78 13 whole or in part. 78 14 3. The plan of merger may set forth any of the following: 78 15 a. Any amendments to the articles of incorporation or 78 16 bylaws of the surviving corporation or limited liability 78 17 company to be effected by the planned merger. 78 18 b. Other provisions relating to the planned merger. 78 19 Sec. 119. NEW SECTION. 504A.1102 LIMITATIONS ON MERGERS 78 20 BY PUBLIC BENEFIT OR RELIGIOUS CORPORATIONS. 78 21 1. Without the prior approval of district court in a 78 22 proceeding of which the attorney general has been given 78 23 written notice, a public benefit or religious corporation may 78 24 merge only with one of the following: 78 25 a. A public benefit or religious corporation. 78 26 b. A foreign corporation which would qualify under this 78 27 chapter as a public benefit or religious corporation. 78 28 c. A wholly owned foreign or domestic business or mutual 78 29 benefit corporation, provided the public benefit or religious 78 30 corporation is the surviving corporation and continues to be a 78 31 public benefit or religious corporation after the merger. 78 32 d. A business or mutual benefit corporation, provided that 78 33 all of the following apply: 78 34 (1) On or prior to the effective date of the merger, 78 35 assets with a value equal to the greater of the fair market 79 1 value of the net tangible and intangible assets, including 79 2 goodwill, of the public benefit corporation or the fair market 79 3 value of the public benefit corporation if it were to be 79 4 operated as a business concern are transferred or conveyed to 79 5 one or more persons who would have received its assets under 79 6 section 504A.1406, subsection 1, paragraphs "e" and "f", had 79 7 it dissolved. 79 8 (2) The business or mutual benefit corporation shall 79 9 return, transfer, or convey any assets held by it upon 79 10 condition requiring return, transfer or conveyance, which 79 11 condition occurs by reason of the merger, in accordance with 79 12 such condition. 79 13 (3) The merger is approved by a majority of directors of 79 14 the public benefit or religious corporation who are not and 79 15 will not become members or shareholders in or officers, 79 16 employees, agents, or consultants of the surviving 79 17 corporation. 79 18 2. At least twenty days before consummation of any merger 79 19 of a public benefit corporation or a religious corporation 79 20 pursuant to subsection 1, paragraph "d", notice, including a 79 21 copy of the proposed plan of merger, must be delivered to the 79 22 attorney general. 79 23 3. Without the prior written consent of the attorney 79 24 general or of the district court in a proceeding in which the 79 25 attorney general has been given notice, a member of a public 79 26 benefit or religious corporation shall not receive or keep 79 27 anything as a result of a merger other than a membership or 79 28 membership in the surviving public benefit or religious 79 29 corporation. The court shall approve the transaction if it is 79 30 in the public interest. 79 31 Sec. 120. NEW SECTION. 504A.1103 ACTION ON PLAN BY 79 32 BOARD, MEMBERS, AND THIRD PERSONS. 79 33 1. Unless this chapter, the articles, bylaws or the board 79 34 of directors or members acting pursuant to subsection 3 79 35 require a greater vote or voting by class, a plan of merger to 80 1 be adopted must be approved by all of the following: 80 2 a. By the board. 80 3 b. By the members, if any, by two-thirds of the votes cast 80 4 or a majority of the voting power, whichever is less. 80 5 c. In writing by any person or persons whose approval is 80 6 required by a provision of the articles authorized by section 80 7 504A.1031 for an amendment to the articles or bylaws. 80 8 2. If the corporation does not have members, the merger 80 9 must be approved by a majority of the directors in office at 80 10 the time the merger is approved. In addition, the corporation 80 11 shall provide notice of any directors' meeting at which such 80 12 approval is to be obtained in accordance with section 80 13 504A.823, subsection 3. The notice must also state that the 80 14 purpose, or one of the purposes, of the meeting is to consider 80 15 the proposed merger. 80 16 3. The board may condition its submission of the proposed 80 17 merger, and the members may condition their approval of the 80 18 merger, on receipt of a higher percentage of affirmative votes 80 19 or on any other basis. 80 20 4. If the board seeks to have the plan approved by the 80 21 members at a membership meeting, the corporation shall give 80 22 notice to its members of the proposed membership meeting in 80 23 accordance with section 504A.705. The notice must also state 80 24 that the purpose, or one of the purposes, of the meeting is to 80 25 consider the plan of merger and contain or be accompanied by a 80 26 copy or summary of the plan. The copy or summary of the plan 80 27 for members of the surviving corporation shall include any 80 28 provision that, if contained in a proposed amendment to the 80 29 articles of incorporation or bylaws, would entitle members to 80 30 vote on the provision. The copy or summary of the plan for 80 31 members of the disappearing corporation shall include a copy 80 32 or summary of the articles and bylaws which will be in effect 80 33 immediately after the merger takes effect. 80 34 5. If the board seeks to have the plan approved by the 80 35 members by written consent or written ballot, the material 81 1 soliciting the approval shall contain or be accompanied by a 81 2 copy or summary of the plan. The copy or summary of the plan 81 3 for members of the surviving corporation shall include any 81 4 provision that, if contained in a proposed amendment to the 81 5 articles of incorporation or bylaws, would entitle members to 81 6 vote on the provision. The copy or summary of the plan for 81 7 members of the disappearing corporation shall include a copy 81 8 or summary of the articles and bylaws which will be in effect 81 9 immediately after the merger takes effect. 81 10 6. Voting by a class of members is required on a plan of 81 11 merger if the plan contains a provision that, if contained in 81 12 a proposed amendment to articles of incorporation or bylaws, 81 13 would entitle the class of members to vote as a class on the 81 14 proposed amendment under section 504A.1004 or 504A.1023. The 81 15 plan must be approved by a class of members by two-thirds of 81 16 the votes cast by the class or a majority of the voting power 81 17 of the class, whichever is less. 81 18 7. After a merger is adopted, and at any time before 81 19 articles of merger are filed, the planned merger may be 81 20 abandoned subject to any contractual rights without further 81 21 action by members or other persons who approved the plan in 81 22 accordance with the procedure set forth in the plan of merger 81 23 or, if none is set forth, in the manner determined by the 81 24 board of directors. 81 25 Sec. 121. NEW SECTION. 504A.1104 ARTICLES OF MERGER. 81 26 After a plan of merger is approved by the board of 81 27 directors, and if required by section 504A.1103, by the 81 28 members and any other persons, the surviving or acquiring 81 29 corporation shall deliver to the secretary of state articles 81 30 of merger setting forth: 81 31 1. The plan of merger. 81 32 2. If approval of members was not required, a statement to 81 33 that effect and a statement that the plan was approved by a 81 34 sufficient vote of the board of directors. 81 35 3. If approval by members was required, both of the 82 1 following: 82 2 a. The designation, number of memberships outstanding, 82 3 number of votes entitled to be cast by each class entitled to 82 4 vote separately on the plan, and number of votes of each class 82 5 indisputably voting on the plan. 82 6 b. Either the total number of votes cast for and against 82 7 the plan by each class entitled to vote separately on the plan 82 8 or the total number of undisputed votes cast for the plan by 82 9 each class and a statement that the number cast for the plan 82 10 by each class was sufficient for approval by that class. 82 11 4. If approval of the plan by some person or persons other 82 12 than the members or the board is required pursuant to section 82 13 504A.1103, subsection 1, paragraph "c", a statement that the 82 14 approval was obtained. 82 15 Sec. 122. NEW SECTION. 504A.1105 EFFECT OF MERGER. 82 16 When a merger takes effect, all of the following occur: 82 17 1. Every other corporation party to the merger merges into 82 18 the surviving corporation and the separate existence of every 82 19 corporation except the surviving corporation ceases. 82 20 2. The title to all real estate and other property owned 82 21 by each corporation party to the merger is vested in the 82 22 surviving corporation without reversion or impairment subject 82 23 to any and all conditions to which the property was subject 82 24 prior to the merger. 82 25 3. The surviving corporation has all liabilities and 82 26 obligations of each corporation party to the merger. 82 27 4. A proceeding pending against any corporation party to 82 28 the merger may be continued as if the merger did not occur or 82 29 the surviving corporation may be substituted in the proceeding 82 30 for the corporation whose existence ceased. 82 31 5. The articles of incorporation and bylaws of the 82 32 surviving corporation are amended to the extent provided in 82 33 the plan of merger. 82 34 Sec. 123. NEW SECTION. 504A.1106 MERGER WITH FOREIGN 82 35 CORPORATION. 83 1 1. Except as provided in section 504A.1102, one or more 83 2 foreign business or nonprofit corporations may merge with one 83 3 or more domestic nonprofit corporations if all of the 83 4 following conditions are met: 83 5 a. The merger is permitted by the law of the state or 83 6 country under whose law each foreign corporation is 83 7 incorporated and each foreign corporation complies with that 83 8 law in effecting the merger. 83 9 b. The foreign corporation complies with section 504A.1104 83 10 if it is the surviving corporation of the merger. 83 11 c. Each domestic nonprofit corporation complies with the 83 12 applicable provisions of sections 504A.1101 through 504A.1103 83 13 and, if it is the surviving corporation of the merger, with 83 14 section 504A.1104. 83 15 2. Upon the merger taking effect, the surviving foreign 83 16 business or nonprofit corporation is deemed to have 83 17 irrevocably appointed the secretary of state as its agent for 83 18 service of process in any proceeding brought against it. 83 19 Sec. 124. NEW SECTION. 504A.1107 BEQUESTS, DEVISES, AND 83 20 GIFTS. 83 21 Any bequest, devise, gift, grant, or promise contained in a 83 22 will or other instrument of donation, subscription, or 83 23 conveyance, which is made to a constituent corporation and 83 24 which takes effect or remains payable after the merger, inures 83 25 to the surviving corporation unless the will or other 83 26 instrument otherwise specifically provides. 83 27 SUBCHAPTER XII 83 28 SALE OF ASSETS 83 29 Sec. 125. NEW SECTION. 504A.1201 SALE OF THE ASSETS IN 83 30 REGULAR COURSE OF ACTIVITIES AND MORTGAGE OF ASSETS. 83 31 1. A corporation may on the terms and conditions and for 83 32 the consideration determined by the board of directors do 83 33 either of the following: 83 34 a. Sell, lease, exchange, or otherwise dispose of all, or 83 35 substantially all, of its property in the usual and regular 84 1 course of its activities. 84 2 b. Mortgage, pledge, dedicate to the repayment of 84 3 indebtedness, whether with or without recourse, or otherwise 84 4 encumber any or all of its property whether or not in the 84 5 usual and regular course of its activities. 84 6 2. Unless the articles require it, approval of the members 84 7 or any other person of a transaction described in subsection 1 84 8 is not required. 84 9 Sec. 126. NEW SECTION. 504A.1202 SALE OF ASSETS OTHER 84 10 THAN IN REGULAR COURSE OF ACTIVITIES. 84 11 1. A corporation may sell, lease, exchange, or otherwise 84 12 dispose of all, or substantially all, of its property, with or 84 13 without the goodwill, other than in the usual and regular 84 14 course of its activities on the terms and conditions and for 84 15 the consideration determined by the corporation's board if the 84 16 proposed transaction is authorized by subsection 2. 84 17 2. Unless this chapter, the articles, bylaws, or the board 84 18 of directors or members acting pursuant to subsection 4 84 19 require a greater vote or voting by class, the proposed 84 20 transaction to be authorized must be approved in all of the 84 21 following manners: 84 22 a. By the board. 84 23 b. By the members by two-thirds of the votes cast or a 84 24 majority of the voting power, whichever is less. 84 25 c. In writing by any person or persons whose approval is 84 26 required by a provision of the articles authorized by section 84 27 504A.1031 for an amendment to the articles or bylaws. 84 28 3. If the corporation does not have members, the 84 29 transaction must be approved by a vote of a majority of the 84 30 directors in office at the time the transaction is approved. 84 31 In addition, the corporation shall provide notice of any 84 32 directors' meeting at which such approval is to be obtained in 84 33 accordance with section 504A.823, subsection 3. The notice 84 34 shall also state that the purpose, or one of the purposes, of 84 35 the meeting is to consider the sale, lease, exchange, or other 85 1 disposition of all, or substantially all, of the property or 85 2 assets of the corporation and contain or be accompanied by a 85 3 copy or summary of a description of the transaction. 85 4 4. The board may condition its submission of the proposed 85 5 transaction, and the members may condition their approval of 85 6 the transaction, on receipt of a higher percentage of 85 7 affirmative votes or on any other basis. 85 8 5. If the corporation seeks to have the transaction 85 9 approved by the members at a membership meeting, the 85 10 corporation shall give notice to its members of the proposed 85 11 membership meeting in accordance with section 504A.705. The 85 12 notice must also state that the purpose, or one of the 85 13 purposes, of the meeting is to consider the sale, lease, 85 14 exchange, or other disposition of all, or substantially all, 85 15 of the property or assets of the corporation and contain or be 85 16 accompanied by a copy or summary of a description of the 85 17 transaction. 85 18 6. If the board needs to have the transaction approved by 85 19 the members by written consent or written ballot, the material 85 20 soliciting the approval shall contain or be accompanied by a 85 21 copy or summary of a description of the transaction. 85 22 7. A public benefit or religious corporation must give 85 23 written notice to the attorney general twenty days before it 85 24 sells, leases, exchanges, or otherwise disposes of all, or 85 25 substantially all, of its property if the transaction is not 85 26 in the usual and regular course of its activities unless the 85 27 attorney general has given the corporation a written waiver of 85 28 the requirements of this subsection. The attorney general 85 29 shall be deemed to have consented to the transaction unless 85 30 notice is given to the corporation within the twenty days. 85 31 8. After a sale, lease, exchange, or other disposition of 85 32 property is authorized, the transaction may be abandoned, 85 33 subject to any contractual rights, without further action by 85 34 the members or any other person who approved the transaction 85 35 in accordance with the procedure set forth in the resolution 86 1 proposing the transaction or, if none is set forth, in the 86 2 manner determined by the board of directors. 86 3 SUBCHAPTER XIII 86 4 DISTRIBUTIONS 86 5 Sec. 127. NEW SECTION. 504A.1301 PROHIBITED 86 6 DISTRIBUTIONS. 86 7 Except as authorized by section 504A.1302, a corporation 86 8 shall not make any distributions. 86 9 Sec. 128. NEW SECTION. 504A.1302 AUTHORIZED 86 10 DISTRIBUTIONS. 86 11 1. A mutual benefit corporation may purchase its 86 12 memberships if after the purchase is completed, both of the 86 13 following apply: 86 14 a. The corporation would be able to pay its debts as they 86 15 become due in the usual course of its activities. 86 16 b. The corporation's total assets would at least equal the 86 17 sum of its total liabilities. 86 18 2. Corporations may make distributions upon dissolution in 86 19 conformity with subchapter 14. 86 20 SUBCHAPTER XIV 86 21 DISSOLUTION 86 22 PART 1 86 23 VOLUNTARY DISSOLUTION 86 24 Sec. 129. NEW SECTION. 504A.1401 DISSOLUTION BY 86 25 INCORPORATORS OR DIRECTORS AND THIRD PERSONS. 86 26 1. A majority of the incorporators of a corporation that 86 27 has no directors and no members or a majority of the directors 86 28 of a corporation that has no members may, subject to any 86 29 approval required by the articles or bylaws, dissolve the 86 30 corporation by delivering articles of dissolution to the 86 31 secretary of state. 86 32 2. The corporation shall give notice of any meeting at 86 33 which dissolution will be approved. The notice must be in 86 34 accordance with section 504A.823, subsection 3. The notice 86 35 must also state that the purpose, or one of the purposes, of 87 1 the meeting is to consider dissolution of the corporation. 87 2 3. The incorporators or directors in approving dissolution 87 3 shall adopt a plan of dissolution indicating to whom the 87 4 assets owned or held by the corporation will be distributed 87 5 after all creditors have been paid. 87 6 Sec. 130. NEW SECTION. 504A.1402 DISSOLUTION BY 87 7 DIRECTORS, MEMBERS, AND THIRD PERSONS. 87 8 1. Unless this chapter, the articles, bylaws, or the board 87 9 of directors or members acting pursuant to subsection 3 87 10 require a greater vote or voting by class, dissolution is 87 11 authorized if it is approved by all of the following: 87 12 a. By the board. 87 13 b. By the members, if any, by two-thirds of the votes cast 87 14 or a majority of the voting power, whichever is less. 87 15 c. In writing by any person or persons whose approval is 87 16 required by a provision of the articles authorized by section 87 17 504A.1031 for an amendment to the articles or bylaws. 87 18 2. If the corporation does not have members, dissolution 87 19 must be approved by a vote of a majority of the directors in 87 20 office at the time the transaction is approved. In addition, 87 21 the corporation shall provide notice of any directors' meeting 87 22 at which such approval is to be obtained in accordance with 87 23 section 504A.823, subsection 3. The notice must also state 87 24 that the purpose, or one of the purposes, of the meeting is to 87 25 consider dissolution of the corporation and contain or be 87 26 accompanied by a copy or summary of the plan of dissolution. 87 27 3. The board may condition its submission of the proposed 87 28 dissolution, and the members may condition their approval of 87 29 the dissolution, on receipt of a higher percentage of 87 30 affirmative votes or on any other basis. 87 31 4. If the board seeks to have dissolution approved by the 87 32 members at a membership meeting, the corporation shall give 87 33 notice to its members of the proposed membership meeting in 87 34 accordance with section 504A.705. The notice must also state 87 35 that the purpose, or one of the purposes, of the meeting is to 88 1 consider dissolving the corporation and contain or be 88 2 accompanied by a copy or summary of the plan of dissolution. 88 3 5. If the board seeks to have the dissolution approved by 88 4 the members by written consent or written ballot, the material 88 5 soliciting the approval shall contain or be accompanied by a 88 6 copy or summary of the plan of dissolution. 88 7 6. The plan of dissolution shall indicate to whom the 88 8 assets owned or held by the corporation will be distributed 88 9 after all creditors have been paid. 88 10 Sec. 131. NEW SECTION. 504A.1403 NOTICES TO THE ATTORNEY 88 11 GENERAL. 88 12 1. A public benefit or religious corporation shall give 88 13 the attorney general written notice that it intends to 88 14 dissolve at or before the time it delivers articles of 88 15 dissolution to the secretary of state. The notice shall 88 16 include a copy or summary of the plan of dissolution. 88 17 2. Assets shall not be transferred or conveyed by a public 88 18 benefit or religious corporation as part of the dissolution 88 19 process until twenty days after it has given the written 88 20 notice required by subsection 1 to the attorney general or 88 21 until the attorney general has consented in writing to, or 88 22 indicated in writing that, the attorney general will take no 88 23 action in respect to the transfer or conveyance, whichever is 88 24 earlier. 88 25 3. When all or substantially all of the assets of a public 88 26 benefit corporation have been transferred or conveyed 88 27 following approval of dissolution, the board shall deliver to 88 28 the attorney general a list showing those, other than 88 29 creditors, to whom the assets were transferred or conveyed. 88 30 The list shall indicate the addresses of each person, other 88 31 than creditors, who received assets and indicate what assets 88 32 each received. 88 33 Sec. 132. NEW SECTION. 504A.1404 ARTICLES OF 88 34 DISSOLUTION. 88 35 1. At any time after dissolution is authorized, the 89 1 corporation may dissolve by delivering articles of dissolution 89 2 to the secretary of state setting forth all of the following: 89 3 a. The name of the corporation. 89 4 b. The date dissolution was authorized. 89 5 c. A statement that dissolution was approved by a 89 6 sufficient vote of the board. 89 7 d. If approval of members was not required, a statement to 89 8 that effect and a statement that dissolution was approved by a 89 9 sufficient vote of the board of directors or incorporators. 89 10 e. If approval by members was required: 89 11 (1) The designation, number of memberships outstanding, 89 12 number of votes entitled to be cast by each class entitled to 89 13 vote separately on dissolution, and number of votes of each 89 14 class indisputably voting on dissolution. 89 15 (2) Either the total number of votes cast for and against 89 16 dissolution by each class entitled to vote separately on 89 17 dissolution or the total number of undisputed votes cast for 89 18 dissolution by each class and a statement that the number cast 89 19 for dissolution by each class was sufficient for approval by 89 20 that class. 89 21 f. If approval of dissolution by some person or persons 89 22 other than the members, the board or the incorporators is 89 23 required pursuant to section 504A.1402, subsection 1, 89 24 paragraph "c", a statement that the approval was obtained. 89 25 g. If the corporation is a public benefit or religious 89 26 corporation, that the notice to the attorney general required 89 27 by section 504A.1403, subsection 1, has been given. 89 28 2. A corporation is dissolved upon the effective date of 89 29 its articles of dissolution. 89 30 Sec. 133. NEW SECTION. 504A.1405 REVOCATION OF 89 31 DISSOLUTION. 89 32 1. A corporation may revoke its dissolution within one 89 33 hundred twenty days of its effective date. 89 34 2. Revocation of dissolution must be authorized in the 89 35 same manner as the dissolution was authorized unless that 90 1 authorization permitted revocation by action of the board of 90 2 directors alone, in which event the board of directors may 90 3 revoke the dissolution without action by the members or any 90 4 other person. 90 5 3. After the revocation of dissolution is authorized, the 90 6 corporation may revoke the dissolution by delivering to the 90 7 secretary of state for filing articles of revocation of 90 8 dissolution, together with a copy of its articles of 90 9 dissolution, that set forth all of the following: 90 10 a. The name of the corporation. 90 11 b. The effective date of the dissolution that was revoked. 90 12 c. The date that the revocation of dissolution was 90 13 authorized. 90 14 d. If the corporation's board of directors or 90 15 incorporators revoked the dissolution, a statement to that 90 16 effect. 90 17 e. If the corporation's board of directors revoked a 90 18 dissolution authorized by the members alone or in conjunction 90 19 with another person or persons, a statement that revocation 90 20 was permitted by action by the board of directors alone 90 21 pursuant to that authorization. 90 22 f. If member or third person action was required to revoke 90 23 the dissolution, the information required by section 90 24 504A.1404, subsection 1, paragraphs "e" and "f". 90 25 4. Revocation of dissolution is effective upon the 90 26 effective date of the articles of revocation of dissolution. 90 27 5. When the revocation of dissolution is effective, it 90 28 relates back to and takes effect as of the effective date of 90 29 the dissolution and the corporation resumes carrying on its 90 30 activities as if dissolution had never occurred. 90 31 Sec. 134. NEW SECTION. 504A.1406 EFFECT OF DISSOLUTION. 90 32 1. A dissolved corporation continues its corporate 90 33 existence but shall not carry on any activities except those 90 34 appropriate to wind up and liquidate its affairs, including 90 35 all of the following: 91 1 a. Preserving and protecting its assets and minimizing its 91 2 liabilities. 91 3 b. Discharging or making provision for discharging its 91 4 liabilities and obligations. 91 5 c. Disposing of its properties that will not be 91 6 distributed in kind. 91 7 d. Returning, transferring, or conveying assets held by 91 8 the corporation upon a condition requiring return, transfer or 91 9 conveyance, which condition occurs by reason of the 91 10 dissolution, in accordance with such condition. 91 11 e. Transferring, subject to any contractual or legal 91 12 requirements, its assets as provided in or authorized by its 91 13 articles of incorporation or bylaws. 91 14 f. If the corporation is a public benefit or religious 91 15 corporation, and a provision has not been made in its articles 91 16 or bylaws for distribution of assets on dissolution, 91 17 transferring, subject to any contractual or legal requirement, 91 18 its assets to one or more persons described in section 501(c)3 91 19 of the Internal Revenue Code, or if the dissolved corporation 91 20 is not described in section 501(c)3 of the Internal Revenue 91 21 Code, to one or more public benefit or religious corporations. 91 22 g. If the corporation is a mutual benefit corporation and 91 23 a provision has not been made in its articles or bylaws for 91 24 distribution of assets on dissolution, transferring its assets 91 25 to its members or, if it has no members, those persons whom 91 26 the corporation holds itself out as benefiting or serving. 91 27 h. Doing every other act necessary to wind up and 91 28 liquidate its assets and affairs. 91 29 2. Dissolution of a corporation does not do any of the 91 30 following: 91 31 a. Transfer title to the corporation's property. 91 32 b. Subject its directors or officers to standards of 91 33 conduct different from those prescribed in subchapter 8. 91 34 c. Change quorum or voting requirements for its board or 91 35 members; change provisions for selection, resignation, or 92 1 removal of its directors or officers or both; or change 92 2 provisions for amending its bylaws. 92 3 d. Prevent commencement of a proceeding by or against the 92 4 corporation in its corporate name. 92 5 e. Abate or suspend a proceeding pending by or against the 92 6 corporation on the effective date of dissolution. 92 7 f. Terminate the authority of the registered agent. 92 8 Sec. 135. NEW SECTION. 504A.1407 KNOWN CLAIMS AGAINST 92 9 DISSOLVED CORPORATION. 92 10 1. A dissolved corporation may dispose of the known claims 92 11 against it by following the procedure described in this 92 12 section. 92 13 2. The dissolved corporation shall notify its known 92 14 claimants in writing of the dissolution at any time after its 92 15 effective date. The written notice must do all of the 92 16 following: 92 17 a. Describe information that must be included in a claim. 92 18 b. Provide a mailing address where a claim may be sent. 92 19 c. State the deadline, which shall not be fewer than one 92 20 hundred twenty days from the effective date of the written 92 21 notice, by which the dissolved corporation must receive the 92 22 claim. 92 23 d. State that the claim will be barred if not received by 92 24 the deadline. 92 25 3. A claim against the dissolved corporation is barred if 92 26 either of the following occurs: 92 27 a. If a claimant who was given written notice under 92 28 subsection 2 does not deliver the claim to the dissolved 92 29 corporation by the deadline. 92 30 b. If a claimant whose claim was rejected by the dissolved 92 31 corporation does not commence a proceeding to enforce the 92 32 claim within ninety days from the effective date of the 92 33 rejection notice. 92 34 4. For purposes of this section, "claim" does not include 92 35 a contingent liability or a claim based on an event occurring 93 1 after the effective date of dissolution. 93 2 Sec. 136. NEW SECTION. 504A.1408 UNKNOWN CLAIMS AGAINST 93 3 DISSOLVED CORPORATION. 93 4 1. A dissolved corporation may also publish notice of its 93 5 dissolution and request that persons with claims against the 93 6 corporation present them in accordance with the notice. 93 7 2. The notice must do all of the following: 93 8 a. Be published one time in a newspaper of general 93 9 circulation in the county where the dissolved corporation's 93 10 principal office is located, or, if none is located in this 93 11 state, where its registered office is or was last located. 93 12 b. Describe the information that must be included in a 93 13 claim and provide a mailing address where the claim may be 93 14 sent. 93 15 c. State that a claim against the corporation will be 93 16 barred unless a proceeding to enforce the claim is commenced 93 17 within five years after publication of the notice. 93 18 3. If the dissolved corporation publishes a newspaper 93 19 notice in accordance with subsection 2, the claim of each of 93 20 the following claimants is barred unless the claimant 93 21 commences a proceeding to enforce the claim against the 93 22 dissolved corporation within five years after the publication 93 23 date of the newspaper notice: 93 24 a. A claimant who did not receive written notice under 93 25 section 504A.1407. 93 26 b. A claimant whose claim was timely sent to the dissolved 93 27 corporation but not acted on. 93 28 c. A claimant whose claim is contingent or based on an 93 29 event occurring after the effective date of dissolution. 93 30 4. A claim may be enforced under this section: 93 31 a. Against the dissolved corporation, to the extent of its 93 32 undistributed assets. 93 33 b. If the assets have been distributed in liquidation, 93 34 against any person, other than a creditor of the corporation, 93 35 to whom the corporation distributed its property to the extent 94 1 of the distributee's pro rata share of the claim or the 94 2 corporate assets distributed to such person in liquidation, 94 3 whichever is less, but the distributee's total liability for 94 4 all claims under this section shall not exceed the total 94 5 amount of assets distributed to the distributee. 94 6 PART 2 94 7 ADMINISTRATIVE DISSOLUTION 94 8 Sec. 137. NEW SECTION. 504A.1421 GROUNDS FOR 94 9 ADMINISTRATIVE DISSOLUTION. 94 10 The secretary of state may commence a proceeding under 94 11 section 504A.1422 to administratively dissolve a corporation 94 12 if any of the following occurs: 94 13 1. The corporation does not deliver its biennial report to 94 14 the secretary of state, in a form that meets the requirements 94 15 of section 504A.1613, within sixty days after it is due. 94 16 2. The corporation is without a registered agent or 94 17 registered office in this state for sixty days or more. 94 18 3. The corporation does not notify the secretary of state 94 19 within sixty days that its registered agent or registered 94 20 office has been changed, that its registered agent has 94 21 resigned, or that its registered office has been discontinued. 94 22 4. The corporation's period of duration, if any, stated in 94 23 its articles of incorporation expires. 94 24 Sec. 138. NEW SECTION. 504A.1422 PROCEDURE FOR AND 94 25 EFFECT OF ADMINISTRATIVE DISSOLUTION. 94 26 1. Upon determining that one or more grounds exist under 94 27 section 504A.1421 for dissolving a corporation, the secretary 94 28 of state shall serve the corporation with written notice of 94 29 that determination under section 504A.504, and in the case of 94 30 a public benefit corporation shall notify the attorney general 94 31 in writing. 94 32 2. If the corporation does not correct each ground for 94 33 dissolution or demonstrate to the reasonable satisfaction of 94 34 the secretary of state that each ground determined by the 94 35 secretary of state does not exist within at least sixty days 95 1 after service of the notice is perfected under section 95 2 504A.504, the secretary of state may administratively dissolve 95 3 the corporation by signing a certificate of dissolution that 95 4 recites the ground or grounds for dissolution and its 95 5 effective date. The secretary of state shall file the 95 6 original of the certificate and serve a copy on the 95 7 corporation under section 504A.504, and in the case of a 95 8 public benefit corporation shall notify the attorney general 95 9 in writing. 95 10 3. A corporation administratively dissolved continues its 95 11 corporate existence but may not carry on any activities except 95 12 those necessary to wind up and liquidate its affairs pursuant 95 13 to section 504A.1406 and notify its claimants pursuant to 95 14 sections 504A.1407 and 504A.1408. 95 15 4. The administrative dissolution of a corporation does 95 16 not terminate the authority of its registered agent. 95 17 5. The secretary of state's administrative dissolution of 95 18 a corporation pursuant to this section appoints the secretary 95 19 of state as the corporation's agent for service of process in 95 20 any proceeding based on a cause of action which arose during 95 21 the time the corporation was authorized to transact business 95 22 in this state. Service of process on the secretary of state 95 23 under this subsection is service on the corporation. Upon 95 24 receipt of process, the secretary of state shall serve a copy 95 25 of the process on the corporation as provided in section 95 26 504A.504. This subsection does not preclude service on the 95 27 corporation's registered agent, if any. 95 28 Sec. 139. NEW SECTION. 504A.1423 REINSTATEMENT FOLLOWING 95 29 ADMINISTRATIVE DISSOLUTION. 95 30 1. A corporation administratively dissolved under section 95 31 504A.1422 may apply to the secretary of state for 95 32 reinstatement within two years after the effective date of 95 33 dissolution. The application must state all of the following: 95 34 a. The name of the corporation and the effective date of 95 35 its administrative dissolution. 96 1 b. That the ground or grounds for dissolution either did 96 2 not exist or have been eliminated. 96 3 c. That the corporation's name satisfies the requirements 96 4 of section 504A.401. 96 5 d. The federal tax identification number of the 96 6 corporation. 96 7 2. a. The secretary of state shall refer the federal tax 96 8 identification number contained in the application for 96 9 reinstatement to the department of revenue and finance. The 96 10 department of revenue and finance shall report to the 96 11 secretary of state the tax status of the corporation. If the 96 12 department reports to the secretary of state that a filing 96 13 delinquency or liability exists against the corporation, the 96 14 secretary of state shall not cancel the certificate of 96 15 dissolution until the filing delinquency or liability is 96 16 satisfied. 96 17 b. If the secretary of state determines that the 96 18 application contains the information required by subsection 1, 96 19 that a delinquency or liability reported pursuant to paragraph 96 20 "a" has been satisfied, and that all of the application 96 21 information is correct, the secretary of state shall cancel 96 22 the certificate of dissolution and prepare a certificate of 96 23 reinstatement reciting that determination and the effective 96 24 date of reinstatement, file the original of the certificate, 96 25 and serve a copy on the corporation under section 504A.504. 96 26 If the corporate name in subsection 1, paragraph "c", is 96 27 different from the corporate name in subsection 1, paragraph 96 28 "a", the certificate of reinstatement shall constitute an 96 29 amendment to the articles of incorporation insofar as it 96 30 pertains to the corporate name. 96 31 3. When reinstatement is effective, it relates back to and 96 32 takes effect as of the effective date of the administrative 96 33 dissolution and the corporation shall resume carrying on its 96 34 activities as if the administrative dissolution had never 96 35 occurred. 97 1 Sec. 140. NEW SECTION. 504A.1424 APPEAL FROM DENIAL OF 97 2 REINSTATEMENT. 97 3 1. The secretary of state, upon denying a corporation's 97 4 application for reinstatement following administrative 97 5 dissolution, shall serve the corporation under section 97 6 504A.504 with a written notice that explains the reason or 97 7 reasons for denial. 97 8 2. The corporation may appeal the denial of reinstatement 97 9 to the district court within ninety days after service of the 97 10 notice of denial is perfected by petitioning to set aside the 97 11 dissolution and attaching to the petition copies of the 97 12 secretary of state's certificate of dissolution, the 97 13 corporation's application for reinstatement, and the secretary 97 14 of state's notice of denial. 97 15 3. The court may summarily order the secretary of state to 97 16 reinstate the dissolved corporation or may take other action 97 17 the court considers appropriate. 97 18 4. The court's final decision may be appealed as in other 97 19 civil proceedings. 97 20 PART 3 97 21 JUDICIAL DISSOLUTION 97 22 Sec. 141. NEW SECTION. 504A.1431 GROUNDS FOR JUDICIAL 97 23 DISSOLUTION. 97 24 1. The district court may dissolve a corporation in any of 97 25 the following proceedings: 97 26 a. In a proceeding brought by the attorney general, if any 97 27 of the following is established: 97 28 (1) The corporation obtained its articles of incorporation 97 29 through fraud. 97 30 (2) The corporation has continued to exceed or abuse the 97 31 authority conferred upon it by law. 97 32 (3) The corporation is a public benefit corporation and 97 33 the corporate assets are being misapplied or wasted. 97 34 (4) The corporation is a public benefit corporation and is 97 35 no longer able to carry out its purposes. 98 1 b. Except as provided in the articles or bylaws of a 98 2 religious corporation, in a proceeding by fifty members or 98 3 members holding five percent of the voting power, whichever is 98 4 less, or by a director or any person specified in the 98 5 articles, if any of the following is established: 98 6 (1) The directors are deadlocked in the management of the 98 7 corporate affairs, and the members, if any, are unable to 98 8 breach the deadlock. 98 9 (2) The directors or those in control of the corporation 98 10 have acted, are acting, or will act in a manner that is 98 11 illegal, oppressive, or fraudulent. 98 12 (3) The members are deadlocked in voting power and have 98 13 failed, for a period that includes at least two consecutive 98 14 annual meeting dates, to elect successors to directors whose 98 15 terms have, or would otherwise have, expired. 98 16 (4) The corporate assets are being misapplied or wasted. 98 17 (5) The corporation is a public benefit or religious 98 18 corporation and is no longer able to carry out its purposes. 98 19 c. In a proceeding by a creditor, if either of the 98 20 following is established: 98 21 (1) The creditor's claim has been reduced to judgment, the 98 22 execution on the judgment is returned unsatisfied, and the 98 23 corporation is insolvent. 98 24 (2) The corporation has admitted in writing that the 98 25 creditor's claim is due and owing and the corporation is 98 26 insolvent. 98 27 d. In a proceeding by the corporation to have its 98 28 voluntary dissolution continued under court supervision. 98 29 2. Prior to dissolving a corporation, the court shall 98 30 consider whether: 98 31 a. There are reasonable alternatives to dissolution. 98 32 b. Dissolution is in the public interest, if the 98 33 corporation is a public benefit corporation. 98 34 c. Dissolution is the best way of protecting the interests 98 35 of members, if the corporation is a mutual benefit 99 1 corporation. 99 2 Sec. 142. NEW SECTION. 504A.1432 PROCEDURE FOR JUDICIAL 99 3 DISSOLUTION. 99 4 1. Venue for a proceeding by the attorney general to 99 5 dissolve a corporation lies in Polk county. Venue for a 99 6 proceeding brought by any other party named in section 99 7 504A.1431 lies in the county where a corporation's principal 99 8 office is located or, if none is located in this state, where 99 9 its registered office is or was last located. 99 10 2. It is not necessary to make directors or members 99 11 parties to a proceeding to dissolve a corporation unless 99 12 relief is sought against them individually. 99 13 3. A court in a proceeding brought to dissolve a 99 14 corporation may issue injunctions, appoint a receiver or 99 15 custodian pendente lite with all powers and duties the court 99 16 directs, take other action required to preserve the corporate 99 17 assets wherever located, and carry on the activities of the 99 18 corporation until a full hearing can be held. 99 19 4. A person other than the attorney general who brings an 99 20 involuntary dissolution proceeding for a public benefit or 99 21 religious corporation shall forthwith give written notice of 99 22 the proceeding to the attorney general who may intervene. 99 23 Sec. 143. NEW SECTION. 504A.1433 RECEIVERSHIP OR 99 24 CUSTODIANSHIP. 99 25 1. A court in a judicial proceeding brought to dissolve a 99 26 public benefit or mutual benefit corporation may appoint one 99 27 or more receivers to wind up and liquidate, or one or more 99 28 custodians to manage, the affairs of the corporation. The 99 29 court shall hold a hearing, after notifying all parties to the 99 30 proceeding and any interested persons designated by the court, 99 31 before appointing a receiver or custodian. The court 99 32 appointing a receiver or custodian has exclusive jurisdiction 99 33 over the corporation and all of its property wherever located. 99 34 2. The court may appoint an individual, or a domestic or 99 35 foreign business or nonprofit corporation authorized to 100 1 transact business in this state as a receiver or custodian. 100 2 The court may require the receiver or custodian to post bond, 100 3 with or without sureties, in an amount the court directs. 100 4 3. The court shall describe the powers and duties of the 100 5 receiver or custodian in its appointing order, which may be 100 6 amended. Among other powers: 100 7 a. The receiver may dispose of all or any part of the 100 8 assets of the corporation wherever located, at a public or 100 9 private sale, if authorized by the court. However, the 100 10 receiver's power to dispose of the assets of the corporation 100 11 is subject to any trust and other restrictions that would be 100 12 applicable to the corporation. The receiver may sue and 100 13 defend in the receiver's or custodian's name as receiver or 100 14 custodian of the corporation in all courts of this state. 100 15 b. The custodian may exercise all of the powers of the 100 16 corporation, through or in place of its board of directors or 100 17 officers, to the extent necessary to manage the affairs of the 100 18 corporation in the best interests of its members and 100 19 creditors. 100 20 4. The court during a receivership may redesignate the 100 21 receiver a custodian, and during a custodianship may 100 22 redesignate the custodian a receiver, if doing so is in the 100 23 best interests of the corporation, its members, and creditors. 100 24 5. The court during the receivership or custodianship may 100 25 order compensation paid and expense disbursements or 100 26 reimbursements made to the receiver or custodian and to the 100 27 receiver's or custodian's counsel from the assets of the 100 28 corporation or proceeds from the sale of the assets. 100 29 Sec. 144. NEW SECTION. 504A.1434 DECREE OF DISSOLUTION. 100 30 1. If after a hearing the court determines that one or 100 31 more grounds for judicial dissolution described in section 100 32 504A.1431 exist, the court may enter a decree dissolving the 100 33 corporation and specifying the effective date of the 100 34 dissolution, and the clerk of the court shall deliver a 100 35 certified copy of the decree to the secretary of state, who 101 1 shall file it. 101 2 2. After entering the decree of dissolution, the court 101 3 shall direct the winding up of the corporation's affairs and 101 4 liquidation of the corporation in accordance with section 101 5 504A.1406 and the notification of its claimants in accordance 101 6 with sections 504A.1407 and 504A.1408. 101 7 PART 4 101 8 MISCELLANEOUS 101 9 Sec. 145. NEW SECTION. 504A.1441 DEPOSIT WITH STATE 101 10 TREASURER. 101 11 Assets of a dissolved corporation which should be 101 12 transferred to a creditor, claimant, or member of the 101 13 corporation who cannot be found or who is not competent to 101 14 receive them shall be reduced to cash subject to known trust 101 15 restrictions and deposited with the treasurer of state for 101 16 safekeeping. However, in the treasurer of state's discretion, 101 17 property may be received and held in kind. When the creditor, 101 18 claimant, or member furnishes satisfactory proof of 101 19 entitlement to the amount deposited or property held in kind, 101 20 the treasurer of state shall deliver to the creditor, member, 101 21 or other person or to the representative of the creditor, 101 22 member, or other person that amount or property. 101 23 SUBCHAPTER XV 101 24 FOREIGN CORPORATIONS 101 25 PART 1 101 26 CERTIFICATE OF AUTHORITY 101 27 Sec. 146. NEW SECTION. 504A.1501 AUTHORITY TO TRANSACT 101 28 BUSINESS REQUIRED. 101 29 1. A foreign corporation shall not transact business in 101 30 this state until it obtains a certificate of authority from 101 31 the secretary of state. 101 32 2. The following activities, among others, do not 101 33 constitute transacting business within the meaning of 101 34 subsection 1, including, but not limited to: 101 35 a. Maintaining, defending, or settling any proceeding. 102 1 b. Holding meetings of the board of directors or members 102 2 or carrying on other activities concerning internal corporate 102 3 affairs. 102 4 c. Maintaining bank accounts. 102 5 d. Maintaining offices or agencies for the transfer, 102 6 exchange, and registration of memberships or securities or 102 7 maintaining trustees or depositaries with respect to those 102 8 securities. 102 9 e. Selling through independent contractors. 102 10 f. Soliciting or obtaining orders, whether by mail or 102 11 through employees or agents or otherwise, if the orders 102 12 require acceptance outside this state before they become 102 13 contracts. 102 14 g. Creating or acquiring indebtedness, mortgages, and 102 15 security interests in real or personal property. 102 16 h. Securing or collecting debts or enforcing mortgages and 102 17 security interests in property securing the debts. 102 18 i. Owning, without more, real or personal property. 102 19 j. Conducting an isolated transaction that is completed 102 20 within thirty days and that is not one in the course of 102 21 repeated transactions of a like nature. 102 22 k. Transacting business in interstate commerce. 102 23 Sec. 147. NEW SECTION. 504A.1502 CONSEQUENCES OF 102 24 TRANSACTING BUSINESS WITHOUT AUTHORITY. 102 25 1. A foreign corporation transacting business in this 102 26 state without a certificate of authority shall not maintain a 102 27 proceeding in any court in this state until it obtains a 102 28 certificate of authority. 102 29 2. The successor to a foreign corporation that transacted 102 30 business in this state without a certificate of authority and 102 31 the assignee of a cause of action arising out of that business 102 32 shall not maintain a proceeding on that cause of action in any 102 33 court in this state until the foreign corporation or its 102 34 successor obtains a certificate of authority. 102 35 3. A court may stay a proceeding commenced by a foreign 103 1 corporation, its successor, or assignee until it determines 103 2 whether the foreign corporation or its successor requires a 103 3 certificate of authority. If it so determines, the court may 103 4 further stay the proceeding until the foreign corporation or 103 5 its successor obtains the certificate. 103 6 4. A foreign corporation is liable for a civil penalty of 103 7 an amount not to exceed a total of one thousand dollars if it 103 8 transacts business in this state without a certificate of 103 9 authority. The attorney general may collect all penalties due 103 10 under this subsection. 103 11 5. Notwithstanding subsections 1 and 2, the failure of a 103 12 foreign corporation to obtain a certificate of authority does 103 13 not impair the validity of its corporate acts or prevent it 103 14 from defending any proceeding in this state. 103 15 Sec. 148. NEW SECTION. 504A.1503 APPLICATION FOR 103 16 CERTIFICATE OF AUTHORITY. 103 17 1. A foreign corporation may apply for a certificate of 103 18 authority to transact business in this state by delivering an 103 19 application to the secretary of state. The application must 103 20 set forth all of the following: 103 21 a. The name of the foreign corporation or, if its name is 103 22 unavailable for use in this state, a corporate name that 103 23 satisfies the requirements of section 504A.1506. 103 24 b. The name of the state or country under whose law it is 103 25 incorporated. 103 26 c. The date of incorporation and period of duration. 103 27 d. The address of its principal office. 103 28 e. The address of its registered office in this state and 103 29 the name of its registered agent at that office. 103 30 f. The names and usual business or home addresses of its 103 31 current directors and officers. 103 32 g. Whether the foreign corporation has members. 103 33 h. Whether the corporation, if it had been incorporated in 103 34 this state, would be a public benefit, mutual benefit, or 103 35 religious corporation. 104 1 2. The foreign corporation shall deliver the completed 104 2 application to the secretary of state, and shall also deliver 104 3 to the secretary of state a certificate of existence or a 104 4 document of similar import duly authenticated by the secretary 104 5 of state or other official having custody of corporate records 104 6 in the state or country under whose law it is incorporated 104 7 which is dated no earlier than ninety days prior to the date 104 8 the application is filed with the secretary of state. 104 9 Sec. 149. NEW SECTION. 504A.1504 AMENDED CERTIFICATE OF 104 10 AUTHORITY. 104 11 1. A foreign corporation authorized to transact business 104 12 in this state shall obtain an amended certificate of authority 104 13 from the secretary of state if it changes any of the 104 14 following: 104 15 a. Its corporate name. 104 16 b. The period of its duration. 104 17 c. The state or country of its incorporation. 104 18 2. The requirements of section 504A.1503 for obtaining an 104 19 original certificate of authority apply to obtaining an 104 20 amended certificate under this section. 104 21 Sec. 150. NEW SECTION. 504A.1505 EFFECT OF CERTIFICATE 104 22 OF AUTHORITY. 104 23 1. A certificate of authority authorizes the foreign 104 24 corporation to which it is issued to transact business in this 104 25 state subject, however, to the right of the state to revoke 104 26 the certificate as provided in this chapter. 104 27 2. A foreign corporation with a valid certificate of 104 28 authority has the same rights and enjoys the same privileges 104 29 as and, except as otherwise provided by this chapter, is 104 30 subject to the same duties, restrictions, penalties, and 104 31 liabilities now or later imposed on a domestic corporation of 104 32 like character. 104 33 3. This chapter does not authorize this state to regulate 104 34 the organization or internal affairs of a foreign corporation 104 35 authorized to transact business in this state. 105 1 Sec. 151. NEW SECTION. 504A.1506 CORPORATE NAME OF 105 2 FOREIGN CORPORATION. 105 3 1. If the corporate name of a foreign corporation does not 105 4 satisfy the requirements of section 504A.401, the foreign 105 5 corporation, to obtain or maintain a certificate of authority 105 6 to transact business in this state, may use a fictitious name 105 7 to transact business in this state if the corporation's real 105 8 name is unavailable and it delivers to the secretary of state 105 9 for filing a copy of the resolution of its board of directors, 105 10 certified by its secretary, adopting the fictitious name. 105 11 2. Except as authorized by subsections 3 and 4, the 105 12 corporate name of a foreign corporation, including a 105 13 fictitious name, must be distinguishable upon the records of 105 14 the secretary of state from all of the following: 105 15 a. The corporate name of a nonprofit or business 105 16 corporation incorporated or authorized to transact business in 105 17 this state. 105 18 b. A corporate name reserved or registered under section 105 19 504A.402 or 504A.403 or section 490.402 or 490.403. 105 20 c. The fictitious name of another foreign business or 105 21 nonprofit corporation authorized to transact business in this 105 22 state. 105 23 3. A foreign corporation may apply to the secretary of 105 24 state for authorization to use in this state the name of 105 25 another corporation incorporated or authorized to transact 105 26 business in this state that is not distinguishable upon the 105 27 records of the secretary of state from the name applied for. 105 28 The secretary of state shall authorize use of the name applied 105 29 for if either of the following applies: 105 30 a. The other corporation consents to the use in writing 105 31 and submits an undertaking in form satisfactory to the 105 32 secretary of state to change its name to a name that is 105 33 distinguishable upon the records of the secretary of state 105 34 from the name of the applying corporation. 105 35 b. The applicant delivers to the secretary of state a 106 1 certified copy of a final judgment of a court of competent 106 2 jurisdiction establishing the applicant's right to use the 106 3 name applied for in this state. 106 4 4. A foreign corporation may use in this state the name, 106 5 including the fictitious name, of another domestic or foreign 106 6 business or nonprofit corporation that is used in this state 106 7 if the other corporation is incorporated or authorized to 106 8 transact business in this state and the foreign corporation 106 9 has filed documentation satisfactory to the secretary of state 106 10 of the occurrence of any of the following: 106 11 a. The foreign corporation has merged with the other 106 12 corporation. 106 13 b. The foreign corporation has been formed by 106 14 reorganization of the other corporation. 106 15 c. The foreign corporation has acquired all or 106 16 substantially all of the assets, including the corporate name, 106 17 of the other corporation. 106 18 5. If a foreign corporation authorized to transact 106 19 business in this state changes its corporate name to one that 106 20 does not satisfy the requirements of section 504A.401, it 106 21 shall not transact business in this state under the changed 106 22 name until it adopts a name satisfying the requirements of 106 23 section 504A.401 and obtains an amended certificate of 106 24 authority under section 504A.1504. 106 25 Sec. 152. NEW SECTION. 504A.1507 REGISTERED OFFICE AND 106 26 REGISTERED AGENT OF FOREIGN CORPORATION. 106 27 Each foreign corporation authorized to transact business in 106 28 this state shall continuously maintain in this state both of 106 29 the following: 106 30 1. A registered office with the same address as that of 106 31 its registered agent. 106 32 2. A registered agent, who may be any of the following: 106 33 a. An individual who resides in this state and whose 106 34 office is identical with the registered office. 106 35 b. A domestic business or nonprofit corporation whose 107 1 office is identical with the registered office. 107 2 c. A foreign business or nonprofit corporation authorized 107 3 to transact business in this state whose office is identical 107 4 with the registered office. 107 5 Sec. 153. NEW SECTION. 504A.1508 CHANGE OF REGISTERED 107 6 OFFICE OR REGISTERED AGENT OF FOREIGN CORPORATION. 107 7 1. A foreign corporation authorized to transact business 107 8 in this state may change its registered office or registered 107 9 agent by delivering to the secretary of state for filing a 107 10 statement of change that sets forth all of the following that 107 11 apply: 107 12 a. The name of its registered office or registered agent. 107 13 b. If the current registered office is to be changed, the 107 14 address of its new registered office. 107 15 c. If the current registered agent is to be changed, the 107 16 name of its new registered agent and the new agent's written 107 17 consent to the appointment, either on the statement or 107 18 attached to it. 107 19 d. That after the change or changes are made, the 107 20 addresses of its registered office and the office of its 107 21 registered agent will be identical. 107 22 2. If a registered agent changes the address of its 107 23 business office, the agent may change the address of the 107 24 registered office of any foreign corporation for which the 107 25 agent is the registered agent by notifying the corporation in 107 26 writing of the change and signing either manually or in 107 27 facsimile and delivering to the secretary of state for filing 107 28 a statement of change that complies with the requirements of 107 29 subsection 1 and recites that the corporation has been 107 30 notified of the change. 107 31 3. If a registered agent changes the registered agent's 107 32 business address to another place, the registered agent may 107 33 change the address of the registered office of any corporation 107 34 for which the registered agent is the registered agent by 107 35 filing a statement as required in subsection 2 for each 108 1 corporation, or by filing a single statement for all 108 2 corporations named in the notice, except that it must be 108 3 signed either manually or in facsimile only by the registered 108 4 agent and must recite that a copy of the statement has been 108 5 mailed to each corporation named in the notice. 108 6 4. A corporation may also change its registered office or 108 7 registered agent in its biennial report as provided in section 108 8 504A.1613. 108 9 Sec. 154. NEW SECTION. 504A.1509 RESIGNATION OF 108 10 REGISTERED AGENT OF FOREIGN CORPORATION. 108 11 1. The registered agent of a foreign corporation may 108 12 resign as agent by signing and delivering to the secretary of 108 13 state for filing the original statement of resignation. The 108 14 statement of resignation may include a statement that the 108 15 registered office is also discontinued. 108 16 The registered agent shall send a copy of the statement of 108 17 resignation by certified mail to the corporation at its 108 18 principal office and to the registered office, if not 108 19 discontinued. The registered agent shall certify to the 108 20 secretary of state that the copies have been sent to the 108 21 corporation, including the date the copies were sent. 108 22 2. The agency appointment is terminated, and the 108 23 registered office discontinued if so provided, on the date on 108 24 which the statement is filed with the secretary of state. 108 25 Sec. 155. NEW SECTION. 504A.1510 SERVICE ON FOREIGN 108 26 CORPORATION. 108 27 1. The registered agent of a foreign corporation 108 28 authorized to transact business in this state is the 108 29 corporation's agent for service of process, notice, or demand 108 30 required or permitted by law to be served on the foreign 108 31 corporation. 108 32 2. A foreign corporation may be served by registered or 108 33 certified mail, return receipt requested, addressed to the 108 34 secretary of the foreign corporation at its principal office 108 35 shown in its application for a certificate of authority or in 109 1 its most recent biennial report filed under section 504A.1613 109 2 if any of the following applies: 109 3 a. The foreign corporation has no registered agent or its 109 4 registered agent cannot with reasonable diligence be served. 109 5 b. The foreign corporation has withdrawn from transacting 109 6 business in this state under section 504A.1521. 109 7 c. The foreign corporation has had its certificate of 109 8 authority revoked under section 504A.1532. 109 9 3. Service is perfected under subsection 2 at the earliest 109 10 of any of the following: 109 11 a. The date the foreign corporation receives the mail. 109 12 b. The date shown on the return receipt, if signed on 109 13 behalf of the foreign corporation. 109 14 c. Five days after its deposit in the United States mail, 109 15 as evidenced by the postmark, if mailed postpaid and correctly 109 16 addressed. 109 17 4. This section does not prescribe the only means, or 109 18 necessarily the required means, of serving a foreign 109 19 corporation. A foreign corporation may also be served in any 109 20 other manner permitted by law. 109 21 PART 2 109 22 WITHDRAWAL 109 23 Sec. 156. NEW SECTION. 504A.1521 WITHDRAWAL OF FOREIGN 109 24 CORPORATION. 109 25 1. A foreign corporation authorized to transact business 109 26 in this state shall not withdraw from this state until it 109 27 obtains a certificate of withdrawal from the secretary of 109 28 state. 109 29 2. A foreign corporation authorized to transact business 109 30 in this state may apply for a certificate of withdrawal by 109 31 delivering an application to the secretary of state for 109 32 filing. The application must set forth all of the following: 109 33 a. The name of the foreign corporation and the name of the 109 34 state or country under whose law it is incorporated. 109 35 b. That it is not transacting business in this state and 110 1 that it surrenders its authority to transact business in this 110 2 state. 110 3 c. That it revokes the authority of its registered agent 110 4 to accept service on its behalf and appoints the secretary of 110 5 state as its agent for service of process in any proceeding 110 6 based on a cause of action arising during the time it was 110 7 authorized to do business in this state. 110 8 d. A mailing address to which the secretary of state may 110 9 mail a copy of any process served on the secretary of state 110 10 under paragraph "c". 110 11 3. After the withdrawal of the corporation is effective, 110 12 service of process on the secretary of state under this 110 13 section is service on the foreign corporation. Upon receipt 110 14 of process, the secretary of state shall mail a copy of the 110 15 process to the foreign corporation at the mailing address set 110 16 forth in its application for withdrawal. 110 17 PART 3 110 18 REVOCATION OF CERTIFICATE OF AUTHORITY 110 19 Sec. 157. NEW SECTION. 504A.1531 GROUNDS FOR REVOCATION. 110 20 1. The secretary of state may commence a proceeding under 110 21 section 504A.1532 to revoke the certificate of authority of a 110 22 foreign corporation authorized to transact business in this 110 23 state if any of the following applies: 110 24 a. The foreign corporation does not deliver the biennial 110 25 report to the secretary of state in a form that meets the 110 26 requirements of section 504A.1613 within sixty days after it 110 27 is due. 110 28 b. The foreign corporation is without a registered agent 110 29 or registered office in this state for sixty days or more. 110 30 c. The foreign corporation does not inform the secretary 110 31 of state under section 504A.1508 or 504A.1509 that its 110 32 registered agent or registered office has changed, that its 110 33 registered agent has resigned, or that its registered office 110 34 has been discontinued within ninety days of the change, 110 35 resignation, or discontinuance. 111 1 d. An incorporator, director, officer, or agent of the 111 2 foreign corporation signed a document that such person knew 111 3 was false in any material respect with intent that the 111 4 document be delivered to the secretary of state for filing. 111 5 e. The secretary of state receives a duly authenticated 111 6 certificate from the secretary of state or other official 111 7 having custody of corporate records in the state or country 111 8 under whose law the foreign corporation is incorporated, 111 9 stating that it has been dissolved or disappeared as the 111 10 result of a merger. 111 11 2. The attorney general may commence a proceeding under 111 12 section 504A.1532 to revoke the certificate of authority of a 111 13 foreign corporation authorized to transact business in this 111 14 state if any of the following applies: 111 15 a. The corporation has continued to exceed or abuse the 111 16 authority conferred upon it by law. 111 17 b. The corporation would have been a public benefit 111 18 corporation had it been incorporated in this state and its 111 19 corporate assets in this state are being misapplied or wasted. 111 20 c. The corporation would have been a public benefit 111 21 corporation had it been incorporated in this state and it is 111 22 no longer able to carry out its purposes. 111 23 Sec. 158. NEW SECTION. 504A.1532 PROCEDURE AND EFFECT OF 111 24 REVOCATION. 111 25 1. The secretary of state, upon determining that one or 111 26 more grounds exist under section 504A.1531 for revocation of a 111 27 certificate of authority, shall serve the foreign corporation 111 28 with written notice of that determination under section 111 29 504A.1510. 111 30 2. The attorney general, upon determining that one or more 111 31 grounds exist under section 504A.1531, subsection 2, for 111 32 revocation of a certificate of authority, shall request the 111 33 secretary of state to serve, and the secretary of state shall 111 34 serve, the foreign corporation with written notice of that 111 35 determination under section 504A.1510. 112 1 3. If the foreign corporation does not correct each ground 112 2 for revocation or demonstrate to the reasonable satisfaction 112 3 of the secretary of state or attorney general that each ground 112 4 for revocation determined by the secretary of state or 112 5 attorney general does not exist within sixty days after 112 6 service of the notice is perfected under section 504A.1510, 112 7 the secretary of state may revoke the foreign corporation's 112 8 certificate of authority by signing a certificate of 112 9 revocation that recites the ground or grounds for revocation 112 10 and its effective date. The secretary of state shall file the 112 11 original of the certificate and serve a copy on the foreign 112 12 corporation under section 504A.1510. 112 13 4. The authority of a foreign corporation to transact 112 14 business in this state ceases on the date shown on the 112 15 certificate revoking its certificate of authority. 112 16 5. The secretary of state's revocation of a foreign 112 17 corporation's certificate of authority appoints the secretary 112 18 of state the foreign corporation's agent for service of 112 19 process in any proceeding based on a cause of action that 112 20 arose during the time the foreign corporation was authorized 112 21 to transact business in this state. Service of process on the 112 22 secretary of state under this subsection is service on the 112 23 foreign corporation. Upon receipt of process, the secretary 112 24 of state shall mail a copy of the process to the secretary of 112 25 the foreign corporation at its principal office shown in its 112 26 most recent biennial report or in any subsequent 112 27 communications received from the corporation stating the 112 28 current mailing address of its principal office, or, if none 112 29 are on file, in its application for a certificate of 112 30 authority. 112 31 6. Revocation of a foreign corporation's certificate of 112 32 authority does not terminate the authority of the registered 112 33 agent of the corporation. 112 34 Sec. 159. NEW SECTION. 504A.1533 APPEAL FROM REVOCATION. 112 35 1. A foreign corporation may appeal the secretary of 113 1 state's revocation of its certificate of authority to the 113 2 district court within thirty days after the service of the 113 3 certificate of revocation is perfected under section 504A.1510 113 4 by petitioning to set aside the revocation and attaching to 113 5 the petition copies of its certificate of authority and the 113 6 secretary of state's certificate of revocation. 113 7 2. The court may summarily order the secretary of state to 113 8 reinstate the certificate of authority or may take any other 113 9 action the court considers appropriate. 113 10 3. The court's final decision may be appealed as in other 113 11 civil proceedings. 113 12 SUBCHAPTER XVI 113 13 RECORDS AND REPORTS 113 14 PART 1 113 15 RECORDS 113 16 Sec. 160. NEW SECTION. 504A.1601 CORPORATE RECORDS. 113 17 1. A corporation shall keep as permanent records minutes 113 18 of all meetings of its members and board of directors, a 113 19 record of all actions taken by the members or directors 113 20 without a meeting, and a record of all actions taken by 113 21 committees of the board of directors as authorized by section 113 22 504A.826, subsection 4. 113 23 2. A corporation shall maintain appropriate accounting 113 24 records. 113 25 3. A corporation or its agent shall maintain a record of 113 26 its members in a form that permits preparation of a list of 113 27 the name and address of all members, in alphabetical order by 113 28 class, showing the number of votes each member is entitled to 113 29 vote. 113 30 4. A corporation shall maintain its records in written 113 31 form or in another form capable of conversion into written 113 32 form within a reasonable time. 113 33 5. A corporation shall keep a copy of all of the following 113 34 records: 113 35 a. Its articles or restated articles of incorporation and 114 1 all amendments to them currently in effect. 114 2 b. Its bylaws or restated bylaws and all amendments to 114 3 them currently in effect. 114 4 c. Resolutions adopted by its board of directors relating 114 5 to the characteristics, qualifications, rights, limitations, 114 6 and obligations of members or any class or category of 114 7 members. 114 8 d. The minutes of all meetings of members and records of 114 9 all actions approved by the members for the past three years. 114 10 e. All written communications to members generally within 114 11 the past three years, including the financial statements 114 12 furnished for the past three years under section 504A.1611. 114 13 f. A list of the names and business or home addresses of 114 14 its current directors and officers. 114 15 g. Its most recent biennial report delivered to the 114 16 secretary of state under section 504A.1613. 114 17 Sec. 161. NEW SECTION. 504A.1602 INSPECTION OF RECORDS 114 18 BY MEMBERS. 114 19 1. Subject to subsection 5, a member is entitled to 114 20 inspect and copy, at a reasonable time and location specified 114 21 by the corporation, any of the records of the corporation 114 22 described in section 504A.1601, subsection 5, if the member 114 23 gives the corporation written notice or a written demand at 114 24 least five business days before the date on which the member 114 25 wishes to inspect and copy. 114 26 2. Subject to subsection 5, a member is entitled to 114 27 inspect and copy, at a reasonable time and reasonable location 114 28 specified by the corporation, any of the following records of 114 29 the corporation if the member meets the requirements of 114 30 subsection 3 and gives the corporation written notice at least 114 31 five business days before the date on which the member wishes 114 32 to inspect and copy: 114 33 a. Excerpts from any records required to be maintained 114 34 under section 504A.1601, subsection 1, to the extent not 114 35 subject to inspection under section 504A.1602, subsection 1. 115 1 b. Accounting records of the corporation. 115 2 c. The membership list. 115 3 3. A member may inspect and copy the records identified in 115 4 subsection 2 only if all of the following apply: 115 5 a. The member's demand is made in good faith and for a 115 6 proper purpose. 115 7 b. The member describes with reasonable particularity the 115 8 purpose and the records the member desires to inspect. 115 9 c. The records are directly connected with this purpose. 115 10 d. The board consents, if consent is required by section 115 11 504A.1605. 115 12 4. This section does not affect either of the following: 115 13 a. The right of a member to inspect records under section 115 14 504A.711 or, if the member is in litigation with the 115 15 corporation, to the same extent as any other litigant. 115 16 b. The power of a court, independently of this chapter, to 115 17 compel the production of corporate records for examination. 115 18 5. The articles or bylaws of a religious corporation may 115 19 limit or abolish the right of a member under this section to 115 20 inspect and copy any corporate record. 115 21 Sec. 162. NEW SECTION. 504A.1603 SCOPE OF INSPECTION 115 22 RIGHT. 115 23 1. A member's agent or attorney has the same inspection 115 24 and copying rights as the member the agent or attorney 115 25 represents. 115 26 2. The right to copy records under section 504A.1602 115 27 includes, if reasonable, the right to receive copies made by 115 28 photographic, xerographic, or other means. 115 29 3. The corporation may impose a reasonable charge, 115 30 covering the costs of labor and material, for copies of any 115 31 documents provided to the member. The charge shall not exceed 115 32 the estimated cost of production or reproduction of the 115 33 records. 115 34 4. The corporation may comply with a member's demand to 115 35 inspect the record of members under section 504A.1602, 116 1 subsection 2, paragraph "c", by providing the member with a 116 2 list of its members that was compiled no earlier than the date 116 3 of the member's demand. 116 4 Sec. 163. NEW SECTION. 504A.1604 COURT-ORDERED 116 5 INSPECTION. 116 6 1. If a corporation does not allow a member who complies 116 7 with section 504A.1602, subsection 1, to inspect and copy any 116 8 records required by that subsection to be available for 116 9 inspection, the district court in the county where the 116 10 corporation's principal office is located or, if none is 116 11 located in this state, where its registered office is located, 116 12 may summarily order inspection and copying of the records 116 13 demanded at the corporation's expense upon application of the 116 14 member. 116 15 2. If a corporation does not within a reasonable time 116 16 allow a member to inspect and copy any other record, the 116 17 member who complies with section 504A.1602, subsections 2 and 116 18 3, may apply to the district court in the county where the 116 19 corporation's principal office is located or, if none is 116 20 located in this state, where its registered office is located, 116 21 for an order to permit inspection and copying of the records 116 22 demanded. The court shall dispose of an application under 116 23 this subsection on an expedited basis. 116 24 3. If the court orders inspection and copying of the 116 25 records demanded, it shall also order the corporation to pay 116 26 the member's costs, including reasonable counsel fees 116 27 incurred, to obtain the order unless the corporation proves 116 28 that it refused inspection in good faith because it had a 116 29 reasonable basis for doubt about the right of the member to 116 30 inspect the records demanded. 116 31 4. If the court orders inspection and copying of the 116 32 records demanded, it may impose reasonable restrictions on the 116 33 use or distribution of the records by the demanding member. 116 34 Sec. 164. NEW SECTION. 504A.1605 LIMITATIONS ON USE OF 116 35 CORPORATE RECORDS. 117 1 Without consent of the board, no corporate record may be 117 2 obtained or used by any person for any purpose unrelated to a 117 3 member's interest as a member. Without limiting the 117 4 generality of the forgoing, without the consent of the board, 117 5 corporate records including, without limitation, a membership 117 6 list or any part thereof, shall not be used for any of the 117 7 following: 117 8 1. To solicit money or property unless such money or 117 9 property will be used solely to solicit the votes of the 117 10 members in an election to be held by the corporation. 117 11 2. For any commercial purpose. 117 12 3. Sold to or purchased by any person. 117 13 4. For any purpose that is detrimental to the interests of 117 14 the corporation. 117 15 PART 2 117 16 REPORTS 117 17 Sec. 165. NEW SECTION. 504A.1611 FINANCIAL STATEMENTS 117 18 FOR MEMBERS. 117 19 1. Except as provided in the articles or bylaws of a 117 20 religious corporation, a corporation upon written demand from 117 21 a member shall furnish that member its latest annual financial 117 22 statements, which may be consolidated or combined statements 117 23 of the corporation and one or more of its subsidiaries or 117 24 affiliates, as appropriate, that include a balance sheet as of 117 25 the end of the fiscal year and statement of operations for 117 26 that year. 117 27 2. If annual financial statements are reported upon by a 117 28 public accountant, the accountant's report must accompany 117 29 them. 117 30 Sec. 166. NEW SECTION. 504A.1612 REPORT OF 117 31 INDEMNIFICATION TO MEMBERS. 117 32 If a corporation indemnifies or advances expenses to a 117 33 director under section 504A.852, 504A.853, 504A.854, or 117 34 504A.855 in connection with a proceeding by or in the right of 117 35 the corporation, the corporation shall report the 118 1 indemnification or advance in writing to the members with or 118 2 before the notice of the next meeting of members. 118 3 Sec. 167. NEW SECTION. 504A.1613 BIENNIAL REPORT FOR 118 4 SECRETARY OF STATE. 118 5 1. Each domestic corporation, and each foreign corporation 118 6 authorized to transact business in this state, shall deliver 118 7 to the secretary of state for filing a biennial report on a 118 8 form prescribed and furnished by the secretary of state that 118 9 sets forth all of the following: 118 10 a. The name of the corporation and the state or country 118 11 under whose law it is incorporated. 118 12 b. The address of the corporation's registered office and 118 13 the name of the corporation's registered agent at the office 118 14 in this state, together with the consent of any new registered 118 15 agent. 118 16 c. The address of the corporation's principal office. 118 17 d. The names and addresses of the president, secretary, 118 18 and treasurer, and one member of the board of directors. 118 19 e. A brief description of the nature of the corporation's 118 20 activities. 118 21 f. Whether or not the corporation has members. 118 22 g. If the corporation is a domestic corporation, whether 118 23 the corporation is a public benefit, mutual benefit, or 118 24 religious corporation. 118 25 h. If the corporation is a foreign corporation, whether 118 26 the corporation would be a public benefit, mutual benefit, or 118 27 religious corporation had the corporation been incorporated in 118 28 this state. 118 29 2. The information in the biennial report must be current 118 30 on the date the biennial report is executed on behalf of the 118 31 corporation. 118 32 3. The first biennial report must be delivered to the 118 33 secretary of state between January 1 and April 1 of the first 118 34 even-numbered year following the calendar year in which a 118 35 domestic corporation was incorporated or a foreign corporation 119 1 was authorized to transact business. Subsequent biennial 119 2 reports must be delivered to the secretary of state between 119 3 January 1 and April 1 of the following even-numbered calendar 119 4 years. 119 5 4. If a biennial report does not contain the information 119 6 required by this section, the secretary of state shall 119 7 promptly notify the reporting domestic or foreign corporation 119 8 in writing and return the report to the corporation for 119 9 correction. A filing fee for the biennial report shall be 119 10 determined by the secretary of state. For purposes of this 119 11 section, each biennial report shall contain information 119 12 related to the two-year period immediately preceding the 119 13 calendar year in which the report is filed. 119 14 5. The secretary of state may provide for the change of 119 15 registered office or registered agent on the form prescribed 119 16 by the secretary of state for the biennial report, provided 119 17 that the form contains the information required in section 119 18 504A.502 or 504A.508. If the secretary of state determines 119 19 that a biennial report does not contain the information 119 20 required by this section but otherwise meets the requirements 119 21 of section 504A.502 or 504A.508 for the purpose of changing 119 22 the registered office or registered agent, the secretary of 119 23 state shall file the statement of change of registered office 119 24 or registered agent, effective as provided in section 119 25 504A.114, before returning the biennial report to the 119 26 corporation as provided in this section. A statement of 119 27 change of registered office or agent pursuant to this 119 28 subsection shall be executed by a person authorized to execute 119 29 the biennial report. 119 30 SUBCHAPTER XVII 119 31 TRANSITION PROVISIONS 119 32 Sec. 168. NEW SECTION. 504A.1701 APPLICATION TO EXISTING 119 33 DOMESTIC CORPORATIONS. 119 34 This chapter applies to all domestic corporations in 119 35 existence on July 1, 2000, that were incorporated under the 120 1 statutes of this state as they existed prior to July 1, 2000. 120 2 Sec. 169. NEW SECTION. 504A.1702 APPLICATION TO 120 3 QUALIFIED FOREIGN CORPORATIONS. 120 4 A foreign corporation authorized to transact business in 120 5 this state on the effective date of this Act is subject to 120 6 this chapter, but is not required to obtain a new certificate 120 7 of authority to transact business under this chapter. 120 8 Sec. 170. NEW SECTION. 504A.1703 SAVING PROVISIONS. 120 9 1. Except as provided in subsection 2, the repeal of a 120 10 statute by this Act does not affect any of the following: 120 11 a. The operation of the statute or any action taken under 120 12 it before its repeal. 120 13 b. Any ratification, right, remedy, privilege, obligation, 120 14 or liability acquired, accrued, or incurred under the statute 120 15 before its repeal. 120 16 c. Any violation of the statute or any penalty, 120 17 forfeiture, or punishment incurred because of the violation, 120 18 before its repeal. 120 19 d. Any proceeding, reorganization, or dissolution 120 20 commenced under the statute before its repeal, and the 120 21 proceeding, reorganization, or dissolution may be completed in 120 22 accordance with the statute as if it had not been repealed. 120 23 2. If a penalty or punishment imposed for violation of a 120 24 statute repealed by this Act is reduced by this chapter, the 120 25 penalty or punishment, if not already imposed, shall be 120 26 imposed in accordance with this chapter. 120 27 Sec. 171. NEW SECTION. 504A.1704 SEVERABILITY. 120 28 If any provision of this chapter or its application to any 120 29 person or circumstance is held invalid by a court of competent 120 30 jurisdiction, the invalidity does not affect other provisions 120 31 or applications of the chapter that can be given effect 120 32 without the invalid provision or application, and to this end 120 33 the provisions of the chapter are severable. 120 34 Sec. 172. NEW SECTION. 504A.1705 EFFECTIVE DATE. 120 35 This chapter takes effect July 1, 2000. 121 1 Sec. 173. NEW SECTION. 504A.1706 PUBLIC BENEFIT, MUTUAL 121 2 BENEFIT, AND RELIGIOUS CORPORATIONS. 121 3 On July 1, 2000, each domestic corporation existing on July 121 4 1, 2000, that is or becomes subject to this chapter shall be 121 5 designated as a public benefit, mutual benefit, or religious 121 6 corporation as follows: 121 7 1. Any corporation designated by statute as a public 121 8 benefit corporation, a mutual benefit corporation, or a 121 9 religious corporation is the type of corporation designated by 121 10 statute. 121 11 2. Any corporation that does not come within subsection 1 121 12 but is organized primarily or exclusively for religious 121 13 purposes is a religious corporation. 121 14 3. Any corporation that does not come within subsection 1 121 15 or 2 but which is recognized as exempt under section 501(c)(3) 121 16 of the Internal Revenue Code, or any successor section, is a 121 17 public benefit corporation. 121 18 4. Any corporation that does not come within subsection 1, 121 19 2, or 3, but which is organized for a public or charitable 121 20 purpose and which upon dissolution must distribute its assets 121 21 to a public benefit corporation, the United States, a state, 121 22 or a person recognized as exempt under section 501(c)(3) of 121 23 the Internal Revenue Code, or any successor section, is a 121 24 public benefit corporation. 121 25 5. Any corporation that does not come within subsection 1, 121 26 2, 3, or 4 is a mutual benefit corporation. 121 27 Sec. 174. Section 125.39, subsection 1, Code 1999, is 121 28 amended to read as follows: 121 29 1. In addition to other requirements established by this 121 30 chapter, a facility shall not be licensed pursuant to section 121 31 125.13 unless it is either a political subdivision, a licensed 121 32 hospital, a licensed health maintenance organization, a 121 33 corporation organized under chapter 490, or a community mental 121 34 health center operating under chapter 230A, or it is organized 121 35 underthe Iowa nonprofit corporation Act appearing aschapter 122 1 504A. In the latter case, one-third of the membership of the 122 2 board of directors shall be representatives of such government 122 3 units providing funds to the facility for treatment of 122 4 substance abuse. 122 5 Sec. 175. Section 230A.12, unnumbered paragraph 1, Code 122 6 1999, is amended to read as follows: 122 7 Each community mental health center established or 122 8 continued in operation pursuant to section 230A.3, shall be 122 9 organized underthe Iowa nonprofit corporation Act appearing122 10aschapter 504A, except that a community mental health center 122 11 organized under chapter 504 prior to July 1, 1974, shall not 122 12 be required by this chapter to adopt the Iowa nonprofit 122 13 corporation Act if it is not otherwise required to do so by 122 14 law. The board of directors of each such community mental 122 15 health center shall enter into an agreement with the county or 122 16 affiliated counties which are to be served by the center, 122 17 which agreement shall include but need not be limited to the 122 18 period of time for which the agreement is to be in force, what 122 19 services the center is to provide for residents of the county 122 20 or counties to be served, standards the center is to follow in 122 21 determining whether and to what extent persons seeking 122 22 services from the center shall be considered able to pay the 122 23 cost of the services received, and policies regarding 122 24 availability of the center's services to persons who are not 122 25 residents of the county or counties served by the center. The 122 26 board of directors, in addition to exercising the powers of 122 27 the board of directors of a nonprofit corporation may: 122 28 Sec. 176. Section 490.401, subsection 2, paragraph b, Code 122 29 1999, is amended to read as follows: 122 30 b. A corporate name reserved or registered under section 122 31 490.402, 490.403, or504A.7504A.402. 122 32 Sec. 177. Section 497.22, unnumbered paragraph 1, Code 122 33 1999, is amended to read as follows: 122 34Sections 504A.83 and 504A.84 applySection 504A.1613 122 35 applies to a cooperative association organized under this 123 1 chapter in the same manner asthose sections applythat 123 2 section applies to a corporation organized under chapter 504A. 123 3 In addition to the information required to be set forth in the 123 4 biennial report under section504A.83504A.1613, the 123 5 cooperative association shall also set forth the total amount 123 6 of business transacted, number of members, total expense of 123 7 operation, total amount of indebtedness, and total profits or 123 8 losses for each calendar or fiscal year of the two-year period 123 9 which ended immediately preceding the first day of January of 123 10 the year in which the report is filed. 123 11 Sec. 178. Section 498.24, unnumbered paragraph 1, Code 123 12 1999, is amended to read as follows: 123 13Sections 504A.83 and 504A.84 applySection 504A.1613 123 14 applies to a cooperative association organized under this 123 15 chapter in the same manner asthose sections applythat 123 16 section applies to a corporation organized under chapter 504A. 123 17 In addition to the information required to be set forth in the 123 18 biennial report under section504A.83504A.1613, the 123 19 cooperative association shall also set forth the total amount 123 20 of business transacted, number of members, total expense of 123 21 operation, total amount of indebtedness, and total profits or 123 22 losses for each calendar or fiscal year of the two-year period 123 23 which ended immediately preceding the first day of January of 123 24 the year in which the report is filed. 123 25 Sec. 179. Section 499.49, Code 1999, is amended to read as 123 26 follows: 123 27 499.49 BIENNIAL REPORT. 123 28Sections 504A.83 and 504A.84 applySection 504A.1613 123 29 applies to a cooperative organized under this chapter in the 123 30 same manner asthose sections applythat section applies to a 123 31 corporation organized under chapter 504A. In addition to the 123 32 information required to be set forth in the biennial report 123 33 under section504A.83504A.1613, the cooperative shall also 123 34 set forth the number of members of the cooperative, the 123 35 percentage of the cooperative's business done with or for its 124 1 own members during each of the fiscal or calendar years of the 124 2 preceding two-year period, the percentage of the cooperative's 124 3 business done with or for each class of nonmembers specified 124 4 in section 499.3, and any other information deemed necessary 124 5 by the secretary of state to advise the secretary whether the 124 6 cooperative is actually functioning as a cooperative. 124 7 Sec. 180. Section 534.501, subsection 4, Code 1999, is 124 8 amended to read as follows: 124 9 4. AMENDMENT PROCEDURE. The procedure for amending 124 10 articles of incorporation or adopting restated articles for 124 11 mutual associations is that specified insection 504A.35124 12 chapter 504A, subchapter 10, and for stock associations it is 124 13 that specified in section 490.726 and sections 490.1002 124 14 through 490.1005. 124 15 Sec. 181. Section 602.8102, subsection 70, Code 1999, is 124 16 amended to read as follows: 124 17 70. Certify a copy of a decree of dissolution of a 124 18 nonprofit corporation to the secretary of state and the 124 19 recorder in the county in which the corporation is located as 124 20 provided in section504A.62504A.1434. 124 21 Sec. 182. Sections 504A.1 through 504A.101, Code 1999, are 124 22 repealed. 124 23 Sec. 183. EFFECTIVE DATE. This Act takes effect July 1, 124 24 2000. 124 25 EXPLANATION 124 26 This bill repeals Code sections 504A.1 through 504A.101, 124 27 relating to nonprofit corporations, and replaces it with the 124 28 revised model nonprofit corporation Act. 124 29 Subchapter I provides for filing requirements, forms 124 30 prescribed and furnished by the secretary of state, filing, 124 31 service, and copying fees, the effective date of filed 124 32 documents, correcting filed documents, the filing duty of the 124 33 secretary of state, the procedure for appealing from the 124 34 secretary of state's refusal to file a document, evidentiary 124 35 effect of a copy of a filed document, a certificate of 125 1 existence, a penalty for signing a false document, powers of 125 2 the secretary of state, notice requirements, judicial relief, 125 3 the role of the attorney general, and religious corporations. 125 4 Subchapter II provides for incorporators of a nonprofit 125 5 corporation, articles of incorporation, incorporation, 125 6 liability for preincorporation transactions, organization of a 125 7 nonprofit corporation, bylaws, and emergency bylaws and 125 8 powers. 125 9 Subchapter III provides for the general powers of a 125 10 nonprofit corporation, emergency powers of a nonprofit 125 11 corporation, and ultra vires. 125 12 Subchapter IV provides for corporate names, reserved names, 125 13 and registered names. 125 14 Subchapter V provides for registered offices and registered 125 15 agents of the corporation, the method of changing a registered 125 16 office or registered agent, resignation of registered agents, 125 17 and the method of service on the nonprofit corporation. 125 18 Subchapter VI provides for the admission of members, 125 19 consideration for admission, member requirements, differences 125 20 in rights and obligations of members, transfer of memberships, 125 21 a member's liability to third parties, a member's liability 125 22 for dues, assessments, and fees, a creditor's action against 125 23 members, resignation of members, termination, expulsion, or 125 24 suspension of members, purchase of memberships, derivative 125 25 suits, and delegates having some or all of the authority of 125 26 members. 125 27 Subchapter VII provides for annual and regular meetings, 125 28 special meetings, court-ordered meetings, action by written 125 29 consent, notice of meetings, waiver of notice, record date, 125 30 determining members entitled to notice and vote, action by 125 31 written ballot, a members' list for a meeting, voting 125 32 entitlement generally, quorum requirements, voting 125 33 requirements, proxies, cumulative voting for directors, other 125 34 methods of electing directors, a corporation's acceptance of 125 35 votes, and voting agreements. 126 1 Subchapter VIII provides for requirements for and duties of 126 2 the board of directors, qualifications of directors, number of 126 3 directors, election, designation, and appointment of 126 4 directors, terms of directors, staggered terms for directors, 126 5 resignation of directors, removal of directors elected by 126 6 members or directors, removal of designated or appointed 126 7 directors, removal of directors by judicial proceeding, 126 8 vacancy on the board of directors, compensation of directors, 126 9 regular and special meetings of the board, action without a 126 10 meeting of the board, call and notice of a meeting of the 126 11 board, waiver of notice of a meeting of the board, quorum and 126 12 voting at a meeting of the board, committees of the board, 126 13 general standards for directors, director conflicts of 126 14 interest, loans to or guarantees for directors and officers, 126 15 liability for unlawful distributions, required officers, 126 16 duties and authority of officers, standards of conduct for 126 17 officers, resignation and removal of officers, contract rights 126 18 of officers, officers' authority to execute documents, 126 19 authority of a nonprofit corporation to indemnify, mandatory 126 20 indemnification, advance for expenses of a director, court- 126 21 ordered indemnification, determination and authorization of 126 22 indemnification, indemnification of officers, employees, and 126 23 agents of the nonprofit corporation, and insurance purchased 126 24 and maintained by the nonprofit corporation. 126 25 Subchapter IX provides for personal liability and 126 26 limitations to the personal liability of a director, officer, 126 27 member, or volunteer of a nonprofit corporation. 126 28 Subchapter X provides for the authority to amend articles 126 29 of incorporation, amendment of the articles of incorporation 126 30 by the directors, amendment of the articles of incorporation 126 31 by directors and members, class voting by members on 126 32 amendments of the articles of incorporation, articles of 126 33 amendment, restated articles of incorporation, amendments of 126 34 the articles of incorporation pursuant to judicial 126 35 reorganization, effect of amendment and restatement, amendment 127 1 of the bylaws by directors, amendment of the bylaws by 127 2 directors and members, class voting by members on amendments 127 3 of the bylaws, approval of amendments of the bylaws and 127 4 articles of incorporation by third persons, and amendments 127 5 terminating members or redeeming or canceling memberships. 127 6 Subchapter XI provides for the approval of a plan of a 127 7 merger, limitations on mergers by public benefit or religious 127 8 corporations, action on a merger plan by the board of 127 9 directors, members, and third persons, articles of merger, 127 10 effects of a merger, merger with a foreign corporation, and 127 11 bequests, devises, and gifts to a corporation involved in a 127 12 merger. 127 13 Subchapter XII provides for the sale of assets in the 127 14 regular course of activities and mortgage of assets and the 127 15 sale of assets other than in the regular course of activities. 127 16 Subchapter XIII provides for prohibited distributions and 127 17 authorized distributions. 127 18 Subchapter XIV provides for dissolution by incorporators or 127 19 directors and third persons, dissolution by directors, 127 20 members, and third persons, notices to the attorney general, 127 21 articles of dissolution, revocation of dissolution, effects of 127 22 dissolution, known claims against a dissolved corporation, 127 23 unknown claims against a dissolved corporation, grounds for 127 24 administrative dissolution, procedure for and effect of 127 25 administrative dissolution, reinstatement following 127 26 administrative dissolution, appeal from denial of 127 27 reinstatement, grounds for judicial dissolution, procedure for 127 28 judicial dissolution, receivership or custodianship, decree of 127 29 dissolution, and depositing assets with the treasurer of 127 30 state. 127 31 Subchapter XV provides for requiring an authority to 127 32 transact business, consequences of transacting business 127 33 without authority, an application for certificate of 127 34 authority, an amended certificate of authority, corporate name 127 35 of a foreign corporation, the registered office and registered 128 1 agent of a foreign corporation, change of a registered office 128 2 of registered agent of a foreign corporation, the resignation 128 3 of a registered agent of a foreign corporation, service on a 128 4 foreign corporation, the withdrawal of a foreign corporation, 128 5 grounds for revocation of a certificate of authority, the 128 6 procedure and effect of revocation of a certificate of 128 7 authority, and appeal from a revocation of a certificate of 128 8 authority. 128 9 Subchapter XVI provides for corporate records, the 128 10 inspection of corporate records by members, the scope of 128 11 inspection rights, court-ordered inspections, financial 128 12 statements of a corporation upon demand by members, and a 128 13 biennial report for the secretary of state. 128 14 Subchapter XVII provides for the application of new Code 128 15 chapter 504A to existing corporations and qualified foreign 128 16 corporations, savings provisions, severability, and the 128 17 designation of public benefit, mutual benefit, and religious 128 18 corporations. 128 19 The bill provides conforming amendments. 128 20 The bill takes effect July 1, 2000. 128 21 LSB 1028YC 78 128 22 mj/jw/5
Text: HSB00228 Text: HSB00230 Text: HSB00200 - HSB00299 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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