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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.101B 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. If the 1 26 document is electronically transmitted, it must be in a format 1 27 that can be retrieved or reproduced in typewritten or printed 1 28 form. 1 29 5. The document must be in the English language. However, 1 30 a corporate name need not be in English if written in English 1 31 letters or Arabic or Roman numerals. The certificate of 1 32 existence required of foreign corporations need not be in 1 33 English if accompanied by a reasonably authenticated English 1 34 translation. 1 35 6. The document must be executed by one of the following: 2 1 a. The presiding officer of the board of directors of a 2 2 domestic or foreign corporation, its president, or by another 2 3 of its officers. 2 4 b. If directors have not been selected or the corporation 2 5 has not been formed, by an incorporator. 2 6 c. If the corporation is in the hands of a receiver, 2 7 trustee, or other court-appointed fiduciary, by that 2 8 fiduciary. 2 9 7. The person executing a document shall sign it and state 2 10 beneath or opposite the signature the person's name and the 2 11 capacity in which the person signs. The document may contain 2 12 a corporate seal, an attestation, an acknowledgment, or a 2 13 verification. 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. Delivery may be made by 2 19 electronic transmission if and to the extent permitted by the 2 20 secretary of state. If it is filed in typewritten or printed 2 21 form and not transmitted electronically, the secretary of 2 22 state may require one exact or conformed copy to be delivered 2 23 with the document, except as provided in sections 504A.503 and 2 24 504A.1509. 2 25 10. When the document is delivered to the office of the 2 26 secretary of state for filing, the correct filing fee, and any 2 27 franchise tax, license fee, or penalty, shall be paid in a 2 28 manner permitted by the secretary of state. 2 29 11. The secretary of state may adopt rules for the 2 30 electronic filing of documents and the certification of 2 31 electronically filed documents. 2 32 Sec. 4. NEW SECTION. 504A.112 FORMS. 2 33 1. The secretary of state may prescribe and furnish on 2 34 request, forms for an application for a certificate of 2 35 existence, a foreign corporation's application for a 3 1 certificate of authority to transact business in this state, a 3 2 foreign corporation's application for a certificate of 3 3 withdrawal, and the biennial report. If the secretary of 3 4 state so requires, use of these forms is mandatory. 3 5 2. The secretary of state may prescribe and furnish on 3 6 request forms for other documents required or permitted to be 3 7 filed by this chapter but their use is not mandatory. 3 8 Sec. 5. NEW SECTION. 504A.113 FILING, SERVICE, AND 3 9 COPYING FEES. 3 10 1. The secretary of state shall collect the following 3 11 fees, as provided by the secretary of state, when the 3 12 documents described in this subsection are delivered for 3 13 filing: 3 14 DOCUMENT FEE 3 15 a. Articles of incorporation .................... $_______ 3 16 b. Application for use of indistinguishable 3 17 name ................................................ $_______ 3 18 c. Application for reserved name ................ $_______ 3 19 d. Notice of transfer of reserved name .......... $_______ 3 20 e. Application for registered name .............. $_______ 3 21 f. Application for renewal of registered name ... $_______ 3 22 g. Corporation's statement of change of 3 23 registered agent or registered office or both ....... $_______ 3 24 h. Agent's statement of change of registered 3 25 office for each affected corporation not to 3 26 exceed a total of _____.............................. $_______ 3 27 i. Agent's statement of resignation ............. no fee 3 28 j. Amendment of articles of incorporation ....... $_______ 3 29 k. Restatement of articles of incorporation 3 30 with amendments ..................................... $_______ 3 31 l. Articles of merger ........................... $_______ 3 32 m. Articles of dissolution ...................... $_______ 3 33 n. Articles of revocation of dissolution ........ $_______ 3 34 o. Certificate of administrative dissolution .... $_______ 3 35 p. Application for reinstatement following 4 1 administrative dissolution .......................... $_______ 4 2 q. Certificate of reinstatement ................. no fee 4 3 r. Certificate of judicial dissolution .......... no fee 4 4 s. Application for certificate of authority ..... $_______ 4 5 t. Application for amended certificate of 4 6 authority ........................................... $_______ 4 7 u. Application for certificate of withdrawal .... $_______ 4 8 v. Certificate of revocation of authority 4 9 to transact business ................................ no fee 4 10 w. Biennial report .............................. $_______ 4 11 x. Articles of correction ....................... $_______ 4 12 y. Application for certificate of existence 4 13 or authorization .................................... $_______ 4 14 z. Any other document required or permitted 4 15 to be filed by this Act ............................. $_______ 4 16 2. The secretary of state shall collect a fee upon being 4 17 served with process under this chapter. The party to a 4 18 proceeding causing service of process is entitled to recover 4 19 the fee paid the secretary of state as costs if the party 4 20 prevails in the proceeding. 4 21 3. The secretary of state shall collect fees for copying 4 22 and certifying the copy of any filed document relating to a 4 23 domestic or foreign corporation. 4 24 Sec. 6. NEW SECTION. 504A.114 EFFECTIVE DATE OF 4 25 DOCUMENT. 4 26 1. Except as provided in subsection 2 and section 4 27 504A.115, a document is effective at the later of the 4 28 following times: 4 29 a. At the date and time of filing, as evidenced by such 4 30 means as the secretary of state may use for the purpose of 4 31 recording the date and time of filing. 4 32 b. At the time specified in the document as its effective 4 33 time on the date it is filed. 4 34 2. A document may specify a delayed effective time and 4 35 date, and if it does so the document becomes effective at the 5 1 time and date specified. If a delayed effective date but no 5 2 time is specified, the document is effective at the close of 5 3 business on that date. A delayed effective date for a 5 4 document shall not be later than the ninetieth day after the 5 5 date filed. 5 6 Sec. 7. NEW SECTION. 504A.115 CORRECTING FILED DOCUMENT. 5 7 1. A domestic or foreign corporation may correct a 5 8 document filed by the secretary of state if the document 5 9 satisfies one of the following: 5 10 a. The document contains an inaccuracy. 5 11 b. The document was defectively executed, attested, 5 12 sealed, verified, or acknowledged. 5 13 c. The electronic transmission was defective. 5 14 2. A document is corrected by doing both of the following: 5 15 a. By preparing articles of correction that satisfy all of 5 16 the following requirements: 5 17 (1) Describe the document, including its filing date, or 5 18 attaching a copy of the document to the articles. 5 19 (2) Specify the inaccuracy or defect to be corrected. 5 20 (3) Correct the incorrect statement or defective 5 21 execution. 5 22 b. By delivering the articles of correction to the 5 23 secretary of state for filing. 5 24 3. Articles of correction are effective on the effective 5 25 date of the document they correct except as to persons relying 5 26 on the uncorrected document and adversely affected by the 5 27 correction. As to those persons, articles of correction are 5 28 effective when filed. 5 29 Sec. 8. NEW SECTION. 504A.116 FILING DUTY OF SECRETARY 5 30 OF STATE. 5 31 1. If a document delivered to the office of the secretary 5 32 of state for filing satisfies the requirements of section 5 33 504A.111, the secretary of state shall file it. 5 34 2. The secretary of state files a document by recording 5 35 the document as filed on the date and the time of receipt. 6 1 After filing a document, except as provided in sections 6 2 504A.503 and 504A.1510, the secretary of state shall deliver 6 3 to the domestic or foreign corporation or its representative a 6 4 copy of the document with an acknowledgment of the date and 6 5 time of filing. 6 6 3. Upon refusing to file a document, the secretary of 6 7 state shall return it to the domestic or foreign corporation 6 8 or its representative, together with a brief, written 6 9 explanation of the reason or reasons for the refusal. 6 10 4. The secretary of state's duty to file documents under 6 11 this section is ministerial. Filing or refusal to file a 6 12 document does not do any of the following: 6 13 a. Affect the validity or invalidity of the document in 6 14 whole or in part. 6 15 b. Relate to the correctness or incorrectness of 6 16 information contained in the document. 6 17 c. Create a presumption that the document is valid or 6 18 invalid or that information contained in the document is 6 19 correct or incorrect. 6 20 Sec. 9. NEW SECTION. 504A.117 APPEAL FROM SECRETARY OF 6 21 STATE'S REFUSAL TO FILE DOCUMENT. 6 22 1. If the secretary of state refuses to file a document 6 23 delivered for filing to the secretary of state's office, the 6 24 domestic or foreign corporation may appeal the refusal to the 6 25 district court in the county where the corporation's principal 6 26 office, or if there is none in this state, its registered 6 27 office, is or will be located. The appeal is commenced by 6 28 petitioning the court to compel filing the document and by 6 29 attaching to the petition the document and the secretary of 6 30 state's explanation of the refusal to file. 6 31 2. The court may summarily order the secretary of state to 6 32 file the document or take other action the court considers 6 33 appropriate. 6 34 3. The court's final decision may be appealed as in other 6 35 civil proceedings. 7 1 Sec. 10. NEW SECTION. 504A.118 EVIDENTIARY EFFECT OF 7 2 COPY OF FILED DOCUMENT. 7 3 A certificate from the secretary of state delivered with a 7 4 copy of a document filed by the secretary of state is 7 5 conclusive evidence that the original document is on file with 7 6 the secretary of state. 7 7 Sec. 11. NEW SECTION. 504A.119 CERTIFICATE OF EXISTENCE. 7 8 1. Any person may apply to the secretary of state to 7 9 furnish a certificate of existence for a domestic or foreign 7 10 corporation. 7 11 2. The certificate of existence shall set forth all of the 7 12 following: 7 13 a. The domestic corporation's corporate name or the 7 14 foreign corporation's corporate name used in this state. 7 15 b. That the domestic corporation is duly incorporated 7 16 under the laws of this state, the date of its incorporation, 7 17 and the period of its duration if less than perpetual; or that 7 18 the foreign corporation is authorized to transact business in 7 19 this state. 7 20 c. That all fees, taxes, and penalties owed to this state 7 21 have been paid, if payment is reflected in the records of the 7 22 secretary of state and nonpayment affects the good standing of 7 23 the domestic or foreign corporation. 7 24 d. That its most recent biennial report required by 7 25 section 504A.1613 has been delivered to the secretary of 7 26 state. 7 27 e. That articles of dissolution have not been filed. 7 28 f. Other facts of record in the office of the secretary of 7 29 state that may be requested by the applicant. 7 30 3. Subject to any qualification stated in the certificate, 7 31 a certificate of existence issued by the secretary of state 7 32 may be relied upon as conclusive evidence that the domestic or 7 33 foreign corporation is in good standing in this state. 7 34 Sec. 12. NEW SECTION. 504A.120 PENALTY FOR SIGNING FALSE 7 35 DOCUMENT. 8 1 1. A person commits an offense by signing a document the 8 2 person knows is false in any material respect with intent that 8 3 the document be delivered to the secretary of state for 8 4 filing. 8 5 2. An offense under this section is a serious misdemeanor 8 6 punishable by a fine not to exceed one thousand dollars. 8 7 PART 3 8 8 SECRETARY OF STATE 8 9 Sec. 13. NEW SECTION. 504A.131 POWERS. 8 10 The secretary of state has all powers reasonably necessary 8 11 to perform the duties required of the secretary of state's 8 12 office by this chapter. 8 13 PART 4 8 14 DEFINITIONS 8 15 Sec. 14. NEW SECTION. 504A.141 CHAPTER DEFINITIONS. 8 16 As used in this chapter, unless the context otherwise 8 17 requires: 8 18 1. "Approved by the members" or "approval by the members" 8 19 means approved or ratified by the affirmative vote of a 8 20 majority of the votes represented and voting at a duly held 8 21 meeting at which a quorum is present which affirmative votes 8 22 also constitute a majority of the required quorum or by a 8 23 written ballot or written consent in conformity with this 8 24 chapter or by the affirmative vote, written ballot, or written 8 25 consent of such greater proportion, including the votes of all 8 26 the members of any class, unit, or grouping as may be provided 8 27 in the articles, bylaws, or this chapter for any specified 8 28 member action. 8 29 2. "Articles of incorporation" or "articles" includes 8 30 amended and restated articles of incorporation and articles of 8 31 merger. 8 32 3. "Board" or "board of directors" means the board of 8 33 directors of a corporation except that no person or group of 8 34 persons are the board of directors because of powers delegated 8 35 to that person or group pursuant to section 504A.801. 9 1 4. "Bylaws" means the code or codes of rules other than 9 2 the articles adopted pursuant to this chapter for the 9 3 regulation or management of the affairs of a corporation 9 4 irrespective of the name or names by which such rules are 9 5 designated. 9 6 5. "Class" means a group of memberships which have the 9 7 same rights with respect to voting, dissolution, redemption, 9 8 and transfer. For purposes of this section, rights shall be 9 9 considered the same if they are determined by a formula 9 10 applied uniformly. 9 11 6. "Corporation" means a public benefit, mutual benefit, 9 12 or religious corporation. 9 13 7. "Delegates" means those persons elected or appointed to 9 14 vote in a representative assembly for the election of a 9 15 director or directors or on other matters. 9 16 8. "Deliver" or "delivery" means any method of delivery 9 17 used in conventional commercial practice, including delivery 9 18 in person, by mail, commercial delivery, and electronic 9 19 transmission. 9 20 9. "Directors" means individuals, designated in the 9 21 articles or bylaws or elected by the incorporators, and their 9 22 successors and individuals elected or appointed by any other 9 23 name or title to act as members of the board. 9 24 10. "Distribution" means the payment of a dividend or any 9 25 part of the income or profit of a corporation to its members, 9 26 directors, or officers. 9 27 11. "Domestic corporation" means a corporation. 9 28 12. "Effective date of notice" is defined in section 9 29 504A.142. 9 30 13. "Electronic transmission" or "electronically 9 31 transmitted" means any process of communication not directly 9 32 involving the physical transfer of paper that is suitable for 9 33 the retention, retrieval, and reproduction of information by 9 34 the recipient. 9 35 14. "Employee" does not include an officer or director of 10 1 a corporation who is not otherwise employed by the 10 2 corporation. 10 3 15. "Entity" includes a corporation and foreign 10 4 corporation; business corporation and foreign business 10 5 corporation; limited liability company and foreign limited 10 6 liability company; profit and nonprofit unincorporated 10 7 association; corporation sole; business trust, estate, 10 8 partnership, trust, and two or more persons having a joint or 10 9 common economic interest; and state, the United States, and 10 10 foreign government. 10 11 16. "File", "filed", or "filing" means filed in the office 10 12 of the secretary of state. 10 13 17. "Foreign corporation" means a corporation organized 10 14 under laws other than the laws of this state which would be a 10 15 nonprofit corporation if formed under the laws of this state. 10 16 18. "Governmental subdivision" includes an authority, 10 17 county, district, and municipality. 10 18 19. "Includes" denotes a partial definition. 10 19 20. "Individual" includes the estate of an incompetent 10 20 individual. 10 21 21. "Means" denotes a complete definition. 10 22 22. "Member" means a person who on more than one occasion, 10 23 pursuant to the provisions of a corporation's articles or 10 24 bylaws, has a right to vote for the election of a director or 10 25 directors of a corporation, irrespective of how a member is 10 26 defined in the articles or bylaws of the corporation. A 10 27 person is not a member because of any of the following: 10 28 a. The person's rights as a delegate. 10 29 b. The person's rights to designate a director. 10 30 c. The person's rights as a director. 10 31 23. "Membership" refers to the rights and obligations a 10 32 member or members have pursuant to a corporation's articles, 10 33 bylaws, and this chapter. 10 34 24. "Mutual benefit corporation" means a domestic 10 35 corporation that is formed as a mutual benefit corporation 11 1 pursuant to subchapter 2 or is required to be a mutual benefit 11 2 corporation pursuant to section 504A.1705. 11 3 25. "Notice" is defined in section 504A.142. 11 4 26. "Person" includes any individual or entity. 11 5 27. "Principal office" means the office in or out of this 11 6 state so designated in the biennial report filed pursuant to 11 7 section 504A.1613 where the principal offices of a domestic or 11 8 foreign corporation are located. 11 9 28. "Proceeding" includes a civil suit and criminal, 11 10 administrative, or investigatory actions. 11 11 29. "Public benefit corporation" means a domestic 11 12 corporation that is formed as a public benefit corporation 11 13 pursuant to subchapter 2 or is required to be a public benefit 11 14 corporation pursuant to section 504A.1705. 11 15 30. "Record date" means the date established under 11 16 subchapter 6 or 7 on which a corporation determines the 11 17 identity of its members for the purposes of this subchapter. 11 18 31. "Religious corporation" means a domestic corporation 11 19 that is formed as a religious corporation pursuant to 11 20 subchapter 2 or is required to be a religious corporation 11 21 pursuant to section 504A.1705. 11 22 32. "Secretary" means the corporate officer to whom the 11 23 board of directors has delegated responsibility under section 11 24 504A.841, subsection 2, for custody of the minutes of the 11 25 directors' and members' meetings and for authenticating the 11 26 records of the corporation. 11 27 33. "Sign" or "signature" includes a manual, facsimile, 11 28 conformed, or electronic signature. 11 29 34. "State", when referring to a part of the United 11 30 States, includes a state and commonwealth and their agencies 11 31 and governmental subdivisions, and a territory and insular 11 32 possession and their agencies and governmental subdivisions of 11 33 the United States. 11 34 35. "United States" includes a district, authority, 11 35 bureau, commission, department, and any other agency of the 12 1 United States. 12 2 36. "Vote" includes authorization by written ballot and 12 3 written consent. 12 4 37. "Voting power" means the total number of votes 12 5 entitled to be cast for the election of directors at the time 12 6 the determination of voting power is made, excluding a vote 12 7 that is contingent upon the happening of a condition or event 12 8 that has not occurred at the time. When a class is entitled 12 9 to vote as a class for directors, the determination of voting 12 10 power of the class shall be based on the percentage of the 12 11 number of directors the class is entitled to elect out of the 12 12 total number of authorized directors. 12 13 Sec. 15. NEW SECTION. 504A.142 NOTICE. 12 14 1. Notice under this chapter must be in writing unless 12 15 oral notice is reasonable under the circumstances. Notice by 12 16 electronic transmission is written notice. 12 17 2. Subject to subsection 1, notice may be communicated in 12 18 person, by mail, or other method of delivery; or by telephone, 12 19 voice mail, or other electronic means. If these forms of 12 20 personal notice are impracticable, notice may be communicated 12 21 by a newspaper of general circulation in the area where 12 22 published or by radio, television, or other form of public 12 23 broadcast communication. 12 24 3. Oral notice is effective when communicated if 12 25 communicated in a comprehensible manner. 12 26 4. Written notice by a domestic or foreign corporation to 12 27 its member, if in a comprehensible form, is effective 12 28 according to one of the following: 12 29 a. Upon deposit in the United States mail, if mailed 12 30 postpaid and correctly addressed to the member's address shown 12 31 in the corporation's current record of members. 12 32 b. When electronically transmitted to the shareholder in a 12 33 manner authorized by the shareholder. 12 34 5. Except as provided in subsection 4, written notice, if 12 35 in a comprehensible form, is effective at the earliest of the 13 1 following: 13 2 a. When received. 13 3 b. Five days after its deposit in the United States mail, 13 4 if mailed correctly addressed and with first-class postage 13 5 affixed. 13 6 c. On the date shown on the return receipt, if sent by 13 7 registered or certified mail, return receipt requested, and 13 8 the receipt is signed by or on behalf of the addressee. 13 9 d. Thirty days after its deposit in the United States 13 10 mail, if mailed correctly addressed and with other than first- 13 11 class, registered, or certified postage affixed. 13 12 6. Written notice is correctly addressed to a member of a 13 13 domestic or foreign corporation if addressed to the member's 13 14 address shown in the corporation's current list of members. 13 15 7. A written notice or report delivered as part of a 13 16 newsletter, magazine, or other publication regularly sent to 13 17 members shall constitute a written notice or report if 13 18 addressed or delivered to the member's address shown in the 13 19 corporation's current list of members, or in the case of 13 20 members who are residents of the same household and who have 13 21 the same address in the corporation's current list of members, 13 22 if addressed or delivered to one of such members, at the 13 23 address appearing on the current list of members. 13 24 8. Written notice is correctly addressed to a domestic or 13 25 foreign corporation authorized to transact business in this 13 26 state, other than in its capacity as a member, if addressed to 13 27 its registered agent or to its secretary at its principal 13 28 office shown in its most recent biennial report or, in the 13 29 case of a foreign corporation that has not yet delivered an 13 30 annual report, in its application for a certificate of 13 31 authority. 13 32 9. If section 504A.705, subsection 2, or any other 13 33 provision of this chapter prescribes notice requirements for 13 34 particular circumstances, those requirements govern. If 13 35 articles or bylaws prescribe notice requirements not 14 1 inconsistent with this section or other provisions of this 14 2 chapter, those requirements govern. 14 3 PART 5 14 4 JUDICIAL RELIEF 14 5 Sec. 16. NEW SECTION. 504A.151 JUDICIAL RELIEF. 14 6 1. If for any reason it is impractical or impossible for a 14 7 corporation to call or conduct a meeting of its members, 14 8 delegates, or directors, or otherwise obtain their consent, in 14 9 the manner prescribed by its articles, bylaws, or this 14 10 chapter, then upon petition of a director, officer, delegate, 14 11 member, or the attorney general, the district court may order 14 12 that such a meeting be called or that a written ballot or 14 13 other form of obtaining the vote of members, delegates, or 14 14 directors be authorized, in such a manner as the court finds 14 15 fair and equitable under the circumstances. 14 16 2. The court shall, in an order issued pursuant to this 14 17 section, provide for a method of notice reasonably designed to 14 18 give actual notice to all persons who would be entitled to 14 19 notice of a meeting held pursuant to the articles, bylaws, and 14 20 this chapter, whether or not the method results in actual 14 21 notice to all such persons or conforms to the notice 14 22 requirements that would otherwise apply. In a proceeding 14 23 under this section, the court may determine who the members or 14 24 directors are. 14 25 3. An order issued pursuant to this section may dispense 14 26 with any requirement relating to the holding of or voting at 14 27 meetings or obtaining votes, including any requirement as to 14 28 quorums or as to the number or percentage of votes needed for 14 29 approval, that would otherwise be imposed by the articles, 14 30 bylaws, or this chapter. 14 31 4. Whenever practical, an order issued pursuant to this 14 32 section shall limit the subject matter of meetings or other 14 33 forms of consent authorized to items, including amendments to 14 34 the articles or bylaws, the resolution of which will or may 14 35 enable the corporation to continue managing its affairs 15 1 without further resort to this section; provided, however, 15 2 that an order under this section may also authorize the 15 3 obtaining of whatever votes and approvals are necessary for 15 4 the dissolution, merger, or sale of assets. 15 5 5. A meeting or other method of obtaining the vote of 15 6 members, delegates, or directors conducted pursuant to an 15 7 order issued under this section, and which complies with all 15 8 the provisions of such order, is for all purposes a valid 15 9 meeting or vote, as the case may be, and shall have the same 15 10 force and effect as if it complied with every requirement 15 11 imposed by the articles, bylaws, and this chapter. 15 12 PART 6 15 13 ATTORNEY GENERAL 15 14 Sec. 17. NEW SECTION. 504A.161 ATTORNEY GENERAL. 15 15 1. The attorney general shall be given notice of the 15 16 commencement of a proceeding which this chapter authorizes the 15 17 attorney general to bring but which has been commenced by 15 18 another person. 15 19 2. Whenever a provision of this chapter requires that 15 20 notice be given to the attorney general before or after 15 21 commencing a proceeding or permits the attorney general to 15 22 commence a proceeding: 15 23 a. If no proceeding has been commenced, the attorney 15 24 general may take appropriate action including, but not limited 15 25 to, seeking injunctive relief. 15 26 b. If a proceeding has been commenced by a person other 15 27 than the attorney general, the attorney general, as of right, 15 28 may intervene in such proceeding. 15 29 Sec. 18. NEW SECTION. 504A.162 RELIGIOUS CORPORATIONS – 15 30 CONSTITUTIONAL PROTECTIONS. 15 31 If religious doctrine governing the affairs of a religious 15 32 corporation is inconsistent with the provisions of this 15 33 chapter on the same subject, the religious doctrine shall 15 34 control to the extent required by the Constitution of the 15 35 United States or the constitution of this state or both. 16 1 SUBCHAPTER II 16 2 ORGANIZATION 16 3 Sec. 19. NEW SECTION. 504A.201 INCORPORATORS. 16 4 One or more persons may act as the incorporator or 16 5 incorporators of a corporation by delivering articles of 16 6 incorporation to the secretary of state for filing. 16 7 Sec. 20. NEW SECTION. 504A.202 ARTICLES OF 16 8 INCORPORATION. 16 9 1. The articles of incorporation shall set forth all of 16 10 the following: 16 11 a. A corporate name for the corporation that satisfies the 16 12 requirements of section 504A.401. 16 13 b. One of the following statements: 16 14 (1) This corporation is a public benefit corporation. 16 15 (2) This corporation is a mutual benefit corporation. 16 16 (3) This corporation is a religious corporation. 16 17 c. The address of the corporation's initial registered 16 18 office and the name of its initial registered agent at that 16 19 office. 16 20 d. The name and address of each incorporator. 16 21 e. Whether the corporation will have members. 16 22 f. Provisions not inconsistent with law regarding the 16 23 distribution of assets on dissolution. 16 24 2. The articles of incorporation may set forth any of the 16 25 following: 16 26 a. The purpose for which the corporation is organized, 16 27 which may be, either alone or in combination with other 16 28 purposes, the transaction of any lawful activity. 16 29 b. The names and addresses of the individuals who are to 16 30 serve as the initial directors. 16 31 c. Provisions not inconsistent with law regarding all of 16 32 the following: 16 33 (1) Managing and regulating the affairs of the 16 34 corporation. 16 35 (2) Defining, limiting, and regulating the powers of the 17 1 corporation, its board of directors, and members, or any class 17 2 of members. 17 3 (3) The characteristics, qualifications, rights, 17 4 limitations, and obligations attaching to each or any class of 17 5 members. 17 6 d. A provision eliminating or limiting the liability of a 17 7 director to the corporation or its members for money damages 17 8 for any action taken, or any failure to take any action, as a 17 9 director, except liability for any of the following: 17 10 (1) The amount of a financial benefit received by a 17 11 director to which the director is not entitled. 17 12 (2) An intentional infliction of harm on the corporation 17 13 or its members. 17 14 (3) A violation of section 504A.834. 17 15 (4) An intentional violation of criminal law. 17 16 A provision set forth in the articles of incorporation 17 17 pursuant to this paragraph shall not eliminate or limit the 17 18 liability of a director for an act or omission that occurs 17 19 prior to the date when the provision becomes effective. 17 20 e. A provision permitting or requiring a corporation to 17 21 indemnify a director for liability, as defined in section 17 22 504A.851, subsection 5, to a person for any action taken, or 17 23 any failure to take any action, as a director except liability 17 24 for any of the following: 17 25 (1) Receipt of a financial benefit to which the person is 17 26 not entitled. 17 27 (2) Intentional infliction of harm on the corporation or 17 28 its members. 17 29 (3) A violation of section 504A.834. 17 30 (4) Intentional violation of criminal law. 17 31 f. Any provision that under this chapter is required or 17 32 permitted to be set forth in the bylaws. 17 33 3. Each incorporator named in the articles must sign the 17 34 articles. 17 35 4. The articles of incorporation need not set forth any of 18 1 the corporate powers enumerated in this chapter. 18 2 Sec. 21. NEW SECTION. 504A.203 INCORPORATION. 18 3 1. Unless a delayed effective date is specified, the 18 4 corporate existence begins when the articles of incorporation 18 5 are filed. 18 6 2. The secretary of state's filing of the articles of 18 7 incorporation is conclusive proof that the incorporators 18 8 satisfied all conditions precedent to incorporation except in 18 9 a proceeding by the state to cancel or revoke the 18 10 incorporation or involuntarily dissolve the corporation. 18 11 Sec. 22. NEW SECTION. 504A.204 LIABILITY FOR 18 12 PREINCORPORATION TRANSACTIONS. 18 13 All persons purporting to act as or on behalf of a 18 14 corporation, knowing there was no incorporation under this 18 15 chapter, are jointly and severally liable for all liabilities 18 16 created while so acting. 18 17 Sec. 23. NEW SECTION. 504A.205 ORGANIZATION OF 18 18 CORPORATION. 18 19 1. After incorporation: 18 20 a. If initial directors are named in the articles of 18 21 incorporation, the initial directors shall hold an 18 22 organizational meeting, at the call of a majority of the 18 23 directors, to complete the organization of the corporation by 18 24 appointing officers, adopting bylaws, and carrying on any 18 25 other business brought before the meeting. 18 26 b. If initial directors are not named in the articles, the 18 27 incorporator or incorporators shall hold an organizational 18 28 meeting at the call of a majority of the incorporators to do 18 29 one of the following: 18 30 (1) Elect directors and complete the organization of the 18 31 corporation. 18 32 (2) Elect a board of directors who shall complete the 18 33 organization of the corporation. 18 34 2. Action required or permitted by this chapter to be 18 35 taken by incorporators at an organizational meeting may be 19 1 taken without a meeting if the action taken is evidenced by 19 2 one or more written consents describing the action taken and 19 3 signed by each incorporator. 19 4 3. An organizational meeting may be held in or out of this 19 5 state in accordance with section 504A.821. 19 6 Sec. 24. NEW SECTION. 504A.206 BYLAWS. 19 7 1. The incorporators or board of directors of a 19 8 corporation shall adopt bylaws for the corporation. 19 9 2. The bylaws may contain any provision for regulating and 19 10 managing the affairs of the corporation that is not 19 11 inconsistent with law or the articles of incorporation. 19 12 Sec. 25. NEW SECTION. 504A.207 EMERGENCY BYLAWS AND 19 13 POWERS. 19 14 1. Unless the articles provide otherwise the directors of 19 15 a corporation may adopt, amend, or repeal bylaws to be 19 16 effective only in an emergency as described in subsection 4. 19 17 The emergency bylaws, which are subject to amendment or repeal 19 18 by the members, may provide special procedures necessary for 19 19 managing the corporation during the emergency, including all 19 20 of the following: 19 21 a. How to call a meeting of the board. 19 22 b. Quorum requirements for the meeting. 19 23 c. Designation of additional or substitute directors. 19 24 2. All provisions of the regular bylaws consistent with 19 25 the emergency bylaws remain effective during the emergency. 19 26 The emergency bylaws are not effective after the emergency 19 27 ends. 19 28 3. Corporate action taken in good faith in accordance with 19 29 the emergency bylaws does both of the following: 19 30 a. Binds the corporation. 19 31 b. Shall not be used to impose liability on a corporate 19 32 director, officer, employee, or agent. 19 33 4. An emergency exists for purposes of this section if a 19 34 quorum of the corporation's directors cannot readily be 19 35 assembled because of some catastrophic event. 20 1 SUBCHAPTER III 20 2 PURPOSES AND POWERS 20 3 Sec. 26. NEW SECTION. 504A.301 PURPOSES. 20 4 1. Every corporation incorporated under this chapter has 20 5 the purpose of engaging in any lawful activity unless a more 20 6 limited purpose is set forth in the articles of incorporation. 20 7 2. A corporation engaging in an activity that is subject 20 8 to regulation under another statute of this state may 20 9 incorporate under this chapter only if incorporation under 20 10 this chapter is not prohibited by the other statute. The 20 11 corporation shall be subject to all limitations of the other 20 12 statute. 20 13 Sec. 27. NEW SECTION. 504A.302 GENERAL POWERS. 20 14 Unless its articles of incorporation provide otherwise, 20 15 every corporation has perpetual duration and succession in its 20 16 corporate name and has the same powers as an individual to do 20 17 all things necessary or convenient to carry out its affairs, 20 18 including without limitation all of the following powers: 20 19 1. Sue and be sued, complain, and defend in its corporate 20 20 name. 20 21 2. Have a corporate seal, which may be altered at will, 20 22 and to use it, or a facsimile of it, by impressing, affixing, 20 23 or in any other manner reproducing it. 20 24 3. Make and amend bylaws not inconsistent with its 20 25 articles of incorporation or with the laws of this state, for 20 26 regulating and managing the affairs of the corporation. 20 27 4. Purchase, receive, lease, or otherwise acquire, and 20 28 own, hold, improve, use, and otherwise deal with real or 20 29 personal property, or any legal or equitable interest in 20 30 property, wherever located. 20 31 5. Sell, convey, mortgage, pledge, lease, exchange, and 20 32 otherwise dispose of all or any part of its property. 20 33 6. Purchase, receive, subscribe for, or otherwise acquire, 20 34 own, hold, vote, use, sell, mortgage, lend, pledge, or 20 35 otherwise dispose of, and deal in and with, shares or other 21 1 interests in, or obligations of, any entity. 21 2 7. Make contracts and guarantees, incur liabilities, 21 3 borrow money, issue notes, bonds, and other obligations, and 21 4 secure any of its obligations by mortgage or pledge of any of 21 5 its property, franchises, or income. 21 6 8. Lend money, invest and reinvest its funds, and receive 21 7 and hold real and personal property as security for repayment, 21 8 except as limited by section 504A.833. 21 9 9. Be a promoter, partner, member, associate, or manager 21 10 of any partnership, joint venture, trust, or other entity. 21 11 10. Conduct its activities, locate offices, and exercise 21 12 the powers granted by this chapter in or out of this state. 21 13 11. Elect or appoint directors, officers, employees, and 21 14 agents of the corporation, define their duties, and fix their 21 15 compensation. 21 16 12. Pay pensions and establish pension plans, pension 21 17 trusts, and other benefit and incentive plans for any or all 21 18 of its current or former directors, officers, employees, and 21 19 agents. 21 20 13. Make donations not inconsistent with law for the 21 21 public welfare or for charitable, religious, scientific, or 21 22 educational purposes and for other purposes that further the 21 23 corporate interest. 21 24 14. Impose dues, assessments, and admission and transfer 21 25 fees upon its members. 21 26 l5. Establish conditions for admission of members, admit 21 27 members, and issue memberships. 21 28 16. Carry on a business. 21 29 17. Do all things necessary or convenient, not 21 30 inconsistent with law, to further the activities and affairs 21 31 of the corporation. 21 32 Sec. 28. NEW SECTION. 504A.303 EMERGENCY POWERS. 21 33 1. In anticipation of or during an emergency as described 21 34 in subsection 4, the board of directors of a corporation may 21 35 do both of the following: 22 1 a. Modify lines of succession to accommodate the 22 2 incapacity of any director, officer, employee, or agent. 22 3 b. Relocate the principal office, designate alternative 22 4 principal offices or regional offices, or authorize an officer 22 5 to do so. 22 6 2. During an emergency described in subsection 4, unless 22 7 emergency bylaws provide otherwise, all of the following shall 22 8 apply: 22 9 a. Notice of a meeting of the board of directors need be 22 10 given only to those directors whom it is practicable to reach 22 11 and such notice may be given in any practicable manner, 22 12 including by publication and radio. 22 13 b. One or more officers of the corporation present at a 22 14 meeting of the board of directors may be deemed to be 22 15 directors for the meeting, in order of rank and within the 22 16 same rank in order of seniority, as necessary to achieve a 22 17 quorum. 22 18 3. Corporate action taken in good faith during an 22 19 emergency under this section to further the ordinary affairs 22 20 of the corporation does both of the following: 22 21 a. Binds the corporation. 22 22 b. Shall not be used to impose liability on a corporate 22 23 director, officer, employee, or agent. 22 24 4. An emergency exists for purposes of this section if a 22 25 quorum of the corporation's directors cannot readily be 22 26 assembled because of some catastrophic event. 22 27 Sec. 29. NEW SECTION. 504A.304 ULTRA VIRES. 22 28 1. Except as provided in subsection 2, the validity of 22 29 corporate action may not be challenged on the ground that the 22 30 corporation lacks or lacked power to act. 22 31 2. A corporation's power to act may be challenged in a 22 32 proceeding against the corporation to enjoin an act when a 22 33 third party has not acquired rights. The proceeding may be 22 34 brought by the attorney general, a director, or by a member or 22 35 members in a derivative proceeding. 23 1 3. A corporation's power to act may be challenged in a 23 2 proceeding against an incumbent or former director, officer, 23 3 employee, or agent of the corporation. The proceeding may be 23 4 brought by a director, the corporation, directly, 23 5 derivatively, or through a receiver, a trustee or other legal 23 6 representative, or in the case of a public benefit 23 7 corporation, by the attorney general. 23 8 SUBCHAPTER IV 23 9 NAMES 23 10 Sec. 30. NEW SECTION. 504A.401 CORPORATE NAME. 23 11 1. A corporate name shall not contain language stating or 23 12 implying that the corporation is organized for a purpose other 23 13 than that permitted by section 504A.301 and its articles of 23 14 incorporation. 23 15 2. Except as authorized by subsections 3 and 4, a 23 16 corporate name must be distinguishable upon the records of the 23 17 secretary of state from: 23 18 a. The corporate name of any other nonprofit or business 23 19 corporation incorporated or authorized to do business in this 23 20 state. 23 21 b. A corporate name reserved or registered under section 23 22 490.402, 490.403, 504A.402, or 504A.403. 23 23 c. The fictitious name of a foreign business or nonprofit 23 24 corporation authorized to transact business in this state 23 25 because its real name is unavailable. 23 26 3. A corporation may apply to the secretary of state for 23 27 authorization to use a name that is not distinguishable upon 23 28 the secretary of state's records from one or more of the names 23 29 described in subsection 2. The secretary of state shall 23 30 authorize use of the name applied for if either of the 23 31 following applies: 23 32 a. The other corporation consents to the use of the name 23 33 in writing and submits an undertaking in a form satisfactory 23 34 to the secretary of state to change its name to a name that is 23 35 distinguishable upon the records of the secretary of state 24 1 from the name of the applying corporation. 24 2 b. The applicant delivers to the secretary of state a 24 3 certified copy of a final judgment from a court of competent 24 4 jurisdiction establishing the applicant's right to use the 24 5 name applied for in this state. 24 6 4. A corporation may use the name, including the 24 7 fictitious name, of another domestic or foreign business or 24 8 nonprofit corporation that is being used in this state if the 24 9 other corporation is incorporated or authorized to do business 24 10 in this state and the proposed user corporation submits 24 11 documentation to the satisfaction of the secretary of state 24 12 establishing any of the following conditions: 24 13 a. The user corporation has merged with the other 24 14 corporation. 24 15 b. The user corporation has been formed by reorganization 24 16 of the other corporation. 24 17 c. The user corporation has acquired all or substantially 24 18 all of the assets, including the corporate name, of the other 24 19 corporation. 24 20 5. This subchapter does not control the use of fictitious 24 21 names; however, if a corporation or a foreign corporation uses 24 22 a fictitious name in this state it shall deliver to the 24 23 secretary of state for filing a copy of the resolution of its 24 24 board of directors, certified by its secretary, adopting the 24 25 fictitious name. 24 26 Sec. 31. NEW SECTION. 504A.402 RESERVED NAME. 24 27 1. A person may reserve the exclusive use of a corporate 24 28 name, including a fictitious name for a foreign corporation 24 29 whose corporate name is not available by delivering an 24 30 application to the secretary of state for filing. Upon 24 31 finding that the corporate name applied for is available, the 24 32 secretary of state shall reserve the name for the applicant's 24 33 exclusive use for a nonrenewable one hundred twenty-day 24 34 period. 24 35 2. The owner of a reserved corporate name may transfer the 25 1 reservation to another person by delivering to the secretary 25 2 of state a signed notice of the transfer that states the name 25 3 and address of the transferee. 25 4 Sec. 32. NEW SECTION. 504A.403 REGISTERED NAME. 25 5 1. A foreign corporation may register its corporate name, 25 6 or its corporate name with any change required by section 25 7 504A.1506, if the name is distinguishable upon the records of 25 8 the secretary of state from both of the following: 25 9 a. The corporate name of a nonprofit or business 25 10 corporation incorporated or authorized to do business in this 25 11 state. 25 12 b. A corporate name reserved under section 490.402, 25 13 490.403, or 504A.402, or registered under this section. 25 14 2. A foreign corporation shall register its corporate 25 15 name, or its corporate name with any change required by 25 16 section 504A.1506, by delivering to the secretary of state an 25 17 application that does both of the following: 25 18 a. Sets forth its corporate name, or its corporate name 25 19 with any change required by section 504A.1506, the state or 25 20 country and date of its incorporation, and a brief description 25 21 of the nature of the activities in which it is engaged. 25 22 b. Is accompanied by a certificate of existence, or a 25 23 document of similar import, from the state or country of 25 24 incorporation. 25 25 3. The name is registered for the applicant's exclusive 25 26 use upon the effective date of the application. 25 27 4. A foreign corporation whose registration is effective 25 28 may renew it for successive years by delivering to the 25 29 secretary of state for filing a renewal application which 25 30 complies with the requirements of subsection 2, between 25 31 October 1 and December 31 of the preceding year. The renewal 25 32 application renews the registration for the following calendar 25 33 year. 25 34 5. A foreign corporation whose registration is effective 25 35 may thereafter qualify as a foreign corporation under that 26 1 name or consent in writing to the use of that name by a 26 2 corporation thereafter incorporated under this chapter or by 26 3 another foreign corporation thereafter authorized to transact 26 4 business in this state. The registration terminates when the 26 5 domestic corporation is incorporated or the foreign 26 6 corporation qualifies or consents to the qualification of 26 7 another foreign corporation under the registered name. 26 8 SUBCHAPTER V 26 9 OFFICE AND AGENT 26 10 Sec. 33. NEW SECTION. 504A.501 REGISTERED OFFICE AND 26 11 REGISTERED AGENT. 26 12 A corporation shall continuously maintain both of the 26 13 following in this state: 26 14 1. A registered office with the same address as that of 26 15 the registered agent. 26 16 2. A registered agent, who may be any of the following: 26 17 a. An individual who resides in this state and whose 26 18 business office is identical with the registered office. 26 19 b. A domestic business or nonprofit corporation whose 26 20 business office is identical to the registered office. 26 21 c. A foreign business or nonprofit corporation authorized 26 22 to transact business in this state whose business office is 26 23 identical to the registered office. 26 24 Sec. 34. NEW SECTION. 504A.502 CHANGE OF REGISTERED 26 25 OFFICE OR REGISTERED AGENT. 26 26 1. A corporation may change its registered office or 26 27 registered agent by delivering to the secretary of state for 26 28 filing a statement of change that sets forth all of the 26 29 following: 26 30 a. The name of the corporation. 26 31 b. If the current registered office is to be changed, the 26 32 address of the new registered office. 26 33 c. If the current registered agent is to be changed, the 26 34 name of the new registered agent and the new agent's written 26 35 consent, either on the statement or attached to it, to the 27 1 change. 27 2 d. That after the change or changes are made, the 27 3 addresses of its registered office and the office of its 27 4 registered agent will be identical. 27 5 2. If the address of a registered agent's business office 27 6 is changed, the registered agent may change the address of the 27 7 registered office of any corporation for which the registered 27 8 agent is the registered agent by notifying the corporation in 27 9 writing of the change and by signing, either manually or in 27 10 facsimile, and delivering to the secretary of state for 27 11 filing, a statement that complies with the requirements of 27 12 subsection 1 and recites that the corporation has been 27 13 notified of the change. 27 14 3. If a registered agent changes the registered agent's 27 15 business address to another place, the registered agent may 27 16 change the address of the registered office of any corporation 27 17 for which the registered agent is the registered agent by 27 18 filing a statement as required in subsection 2 for each 27 19 corporation, or by filing a single statement for all 27 20 corporations named in the notice, except that it need be 27 21 signed, either manually or in facsimile, only once by the 27 22 registered agent and must recite that a copy of the statement 27 23 has been mailed to each corporation named in the notice. 27 24 Sec. 35. NEW SECTION. 504A.503 RESIGNATION OF REGISTERED 27 25 AGENT. 27 26 1. A registered agent may resign as registered agent by 27 27 signing and delivering to the secretary of state for filing a 27 28 signed original statement of resignation. The statement may 27 29 include a statement that the registered office is also 27 30 discontinued. 27 31 The registered agent shall send a copy of the statement of 27 32 resignation by certified mail to the corporation at its 27 33 principal office and to the registered office, if not 27 34 discontinued. The registered agent shall certify to the 27 35 secretary of state that copies have been sent to the 28 1 corporation, including the date the copies were sent. 28 2 2. The agency appointment is terminated, and the 28 3 registered office discontinued if so provided, on the date the 28 4 statement was filed. 28 5 Sec. 36. NEW SECTION. 504A.504 SERVICE ON CORPORATION. 28 6 1. A corporation's registered agent is the corporation's 28 7 agent for service of process, notice, or demand required or 28 8 permitted by law to be served on the corporation. 28 9 2. If a corporation has no registered agent, or the agent 28 10 cannot with reasonable diligence be served, the corporation 28 11 may be served by registered or certified mail, return receipt 28 12 requested, addressed to the secretary of the corporation at 28 13 its principal office shown in the most recent biennial report 28 14 filed pursuant to section 504A.1613. Service is perfected 28 15 under this subsection on the earliest of any of the following: 28 16 a. The date the corporation receives the mail. 28 17 b. The date shown on the return receipt, if signed on 28 18 behalf of the corporation. 28 19 c. Five days after its deposit in the United States mail, 28 20 if mailed and correctly addressed with first class postage 28 21 affixed. 28 22 3. This section does not prescribe the only means, or 28 23 necessarily the required means, of serving a corporation. A 28 24 corporation may also be served in any other manner permitted 28 25 by law. 28 26 SUBCHAPTER VI 28 27 MEMBERS AND MEMBERSHIPS 28 28 PART 1 28 29 ADMISSION OF MEMBERS 28 30 Sec. 37. NEW SECTION. 504A.601 ADMISSION. 28 31 1. The articles or bylaws may establish criteria or 28 32 procedures for admission of members. 28 33 2. A person shall not be admitted as a member without the 28 34 person's consent or affirmative action evidencing consent. 28 35 Sec. 38. NEW SECTION. 504A.602 CONSIDERATION. 29 1 Except as provided in its articles or bylaws, a corporation 29 2 may admit members for no consideration or for such 29 3 consideration as is determined by the board. 29 4 Sec. 39. NEW SECTION. 504A.603 NO REQUIREMENT OF 29 5 MEMBERS. 29 6 A corporation is not required to have members. 29 7 PART 2 29 8 TYPES OF MEMBERSHIPS – MEMBERS' RIGHTS AND OBLIGATIONS 29 9 Sec. 40. NEW SECTION. 504A.611 DIFFERENCES IN RIGHTS AND 29 10 OBLIGATIONS OF MEMBERS. 29 11 All members shall have the same rights and obligations with 29 12 respect to voting, dissolution, redemption, and transfer, 29 13 unless the articles or bylaws establish classes of membership 29 14 with different rights or obligations. All members shall have 29 15 the same rights and obligations with respect to any other 29 16 matters, except as set forth in or authorized by the articles 29 17 or bylaws. A person that has no voting rights and is 29 18 identified as a member in the articles or bylaws of the 29 19 corporation shall have only those rights set forth for such a 29 20 member in the articles or bylaws of the corporation. 29 21 Sec. 41. NEW SECTION. 504A.612 TRANSFERS. 29 22 1. Except as set forth in or authorized by the articles or 29 23 bylaws, a member of a mutual benefit corporation shall not 29 24 transfer a membership or any right arising therefrom. 29 25 2. A member of a public benefit or religious corporation 29 26 shall not transfer a membership or any right arising 29 27 therefrom. 29 28 3. Where transfer rights have been provided, a restriction 29 29 on them shall not be binding with respect to a member holding 29 30 a membership issued prior to the adoption of the restriction 29 31 unless the restriction is approved by the members and the 29 32 affected member. 29 33 Sec. 42. NEW SECTION. 504A.613 MEMBER'S LIABILITY TO 29 34 THIRD PARTIES. 29 35 A member of a corporation is not, as such, personally 30 1 liable for the acts, debts, liabilities, or obligations of the 30 2 corporation. 30 3 Sec. 43. NEW SECTION. 504A.614 MEMBER'S LIABILITY FOR 30 4 DUES, ASSESSMENTS, AND FEES. 30 5 A member may become liable to the corporation for dues, 30 6 assessments, or fees. However, an article or bylaw provision 30 7 or a resolution adopted by the board authorizing or imposing 30 8 dues, assessments, or fees does not, of itself, create 30 9 liability. 30 10 Sec. 44. NEW SECTION. 504A.615 CREDITOR'S ACTION AGAINST 30 11 MEMBER. 30 12 1. A proceeding shall not be brought by a creditor to 30 13 reach the liability, if any, of a member to the corporation 30 14 unless final judgment has been rendered in favor of the 30 15 creditor against the corporation and execution has been 30 16 returned unsatisfied in whole or in part or unless such 30 17 proceeding would be useless. 30 18 2. All creditors of the corporation, with or without 30 19 reducing their claims to judgment, may intervene in any 30 20 creditor's proceeding brought under subsection 1 to reach and 30 21 apply unpaid amounts due the corporation. Any or all members 30 22 who owe amounts to the corporation may be joined in such 30 23 proceeding. 30 24 PART 3 30 25 RESIGNATION AND TERMINATION 30 26 Sec. 45. NEW SECTION. 504A.621 RESIGNATION. 30 27 1. A member may resign at any time. 30 28 2. The resignation of a member does not relieve the member 30 29 from any obligations the member may have to the corporation as 30 30 a result of obligations incurred or commitments made prior to 30 31 resignation. 30 32 Sec. 46. NEW SECTION. 504A.622 TERMINATION, EXPULSION, 30 33 OR SUSPENSION. 30 34 1. A member of a public benefit or mutual benefit 30 35 corporation shall not be expelled or suspended, and a 31 1 membership or memberships in such a corporation shall not be 31 2 terminated or suspended except pursuant to a procedure which 31 3 is fair and reasonable and is carried out in good faith. 31 4 2. A procedure is fair and reasonable when either of the 31 5 following occurs: 31 6 a. The articles or bylaws set forth a procedure which 31 7 provides both of the following: 31 8 (1) Not less than fifteen days' prior written notice of 31 9 the expulsion, suspension, or termination and the reasons 31 10 therefore. 31 11 (2) An opportunity for the member to be heard, orally or 31 12 in writing, not less than five days before the effective date 31 13 of the expulsion, suspension, or termination by a person or 31 14 persons authorized to decide that the proposed expulsion, 31 15 termination, or suspension not take place. 31 16 b. The procedure requires consideration of all relevant 31 17 facts and circumstances surrounding the expulsion, suspension, 31 18 or termination by a person or persons authorized to make a 31 19 decision regarding the proposed expulsion, termination, or 31 20 suspension. 31 21 3. Any written notice given by mail pursuant to this 31 22 section must be given by first class or certified mail sent to 31 23 the last address of the member shown on the corporation's 31 24 records. 31 25 4. A proceeding challenging an expulsion, suspension, or 31 26 termination, including a proceeding alleging defective notice, 31 27 must be commenced within one year after the effective date of 31 28 the expulsion, suspension, or termination. 31 29 5. A member who has been expelled or suspended may be 31 30 liable to the corporation for dues, assessments, or fees as a 31 31 result of obligations incurred or commitments made prior to 31 32 expulsion or suspension. 31 33 Sec. 47. NEW SECTION. 504A.623 PURCHASE OF MEMBERSHIPS. 31 34 1. A public benefit or religious corporation shall not 31 35 purchase any of its memberships or any right arising 32 1 therefrom. 32 2 2. A mutual benefit corporation may purchase the 32 3 membership of a member who resigns or whose membership is 32 4 terminated for the amount and pursuant to the conditions set 32 5 forth in or authorized by its articles or bylaws. A payment 32 6 shall not be made in violation of subchapter 13. 32 7 PART 4 32 8 DERIVATIVE PROCEEDINGS 32 9 Sec. 48. NEW SECTION. 504A.631 DERIVATIVE PROCEEDINGS – 32 10 DEFINITION. 32 11 In this part, unless the context otherwise requires, 32 12 "derivative proceeding" means a civil suit in the right of a 32 13 domestic corporation or, to the extent provided in section 32 14 504A.638, in the right of a foreign corporation. 32 15 Sec. 49. NEW SECTION. 504A.632 STANDING. 32 16 A member or director shall not commence or maintain a 32 17 derivative proceeding unless the member or director satisfies 32 18 both of the following: 32 19 1. Was a member or director of the corporation at the time 32 20 of the act or omission complained of or became a member 32 21 through transfer by operation of law from one who was a member 32 22 at that time. 32 23 2. The member or director fairly and adequately represents 32 24 the interests of the corporation in enforcing the rights of 32 25 the corporation. 32 26 Sec. 50. NEW SECTION. 504A.633 DEMAND. 32 27 A member or director shall not commence a derivative 32 28 proceeding until both of the following have occurred: 32 29 1. A written demand has been made upon the corporation to 32 30 take suitable action. 32 31 2. Ninety days have expired from the date the demand was 32 32 made, unless the member or director has earlier been notified 32 33 that the demand has been rejected by the corporation or unless 32 34 irreparable injury to the corporation would result by waiting 32 35 for the expiration of the ninety-day period. 33 1 Sec. 51. NEW SECTION. 504A.634 STAY OF PROCEEDINGS. 33 2 If a corporation commences an inquiry into the allegations 33 3 made in a demand or complaint, the court may stay any 33 4 derivative proceeding for a period of time as the court deems 33 5 appropriate. 33 6 Sec. 52. NEW SECTION. 504A.635 DISMISSAL. 33 7 1. A derivative proceeding shall be dismissed by the court 33 8 on motion by the corporation if one of the groups specified in 33 9 subsection 2 or 6 has determined in good faith after 33 10 conducting a reasonable inquiry upon which its conclusions are 33 11 based that the maintenance of the derivative proceeding is not 33 12 in the best interests of the corporation. A corporation 33 13 moving to dismiss on this basis shall submit in support of the 33 14 motion a short and concise statement of the reasons for its 33 15 determination. 33 16 2. Unless a panel is appointed pursuant to subsection 6, 33 17 the determination in subsection 1 shall be made by one of the 33 18 following: 33 19 a. A majority vote of independent directors present at a 33 20 meeting of the board of directors if the independent directors 33 21 constitute a quorum. 33 22 b. A majority vote of a committee consisting of two or 33 23 more independent directors appointed by majority vote of 33 24 independent directors present at a meeting of the board of 33 25 directors, whether or not such independent directors 33 26 constitute a quorum. 33 27 3. None of the following shall by itself cause a director 33 28 to be considered not independent for purposes of this section: 33 29 a. The nomination or election of the director by persons 33 30 who are defendants in the derivative proceeding or against 33 31 whom action is demanded. 33 32 b. The naming of the director as a defendant in the 33 33 derivative proceeding or as a person against whom action is 33 34 demanded. 33 35 c. The approval by the director of the act being 34 1 challenged in the derivative proceeding or demand if the act 34 2 resulted in no personal benefit to the director. 34 3 4. If a derivative proceeding is commenced after a 34 4 determination has been made rejecting a demand by a member or 34 5 director, the complaint shall allege with particularity facts 34 6 establishing one of the following: 34 7 a. That a majority of the board of directors did not 34 8 consist of independent directors at the time the determination 34 9 was made. 34 10 b. That the requirements of subsection 1 have not been 34 11 met. 34 12 All discovery and other proceedings shall be stayed during 34 13 the pendency of any motion to dismiss unless the court finds 34 14 upon the motion of any party that particularized discovery is 34 15 necessary to preserve evidence or prevent undue prejudice to 34 16 that party. 34 17 5. If a majority of the board of directors does not 34 18 consist of independent directors at the time the determination 34 19 is made, the corporation shall have the burden of proving that 34 20 the requirements of subsection 1 have been met. If a majority 34 21 of the board of directors consists of independent directors at 34 22 the time the determination is made, the plaintiff shall have 34 23 the burden of proving that the requirements of subsection 1 34 24 have not been met. 34 25 6. The court may appoint a panel of one or more 34 26 independent persons upon motion by the corporation to make a 34 27 determination whether the maintenance of the derivative 34 28 proceeding is in the best interests of the corporation. In 34 29 such case, the plaintiff shall have the burden of proving that 34 30 the requirements of subsection 1 have not been met. 34 31 Sec. 53. NEW SECTION. 504A.636 DISCONTINUANCE OR 34 32 SETTLEMENT. 34 33 A derivative proceeding shall not be discontinued or 34 34 settled without the court's approval. If the court determines 34 35 that a proposed discontinuance or settlement will 35 1 substantially affect the interests of a corporation's member 35 2 or class of members or director, the court shall direct that 35 3 notice be given to the members or director affected. 35 4 Sec. 54. NEW SECTION. 504A.637 PAYMENT OF EXPENSES. 35 5 On termination of a derivative proceeding, the court may do 35 6 either of the following: 35 7 1. Order the corporation to pay the plaintiff's reasonable 35 8 expenses, including attorney fees incurred in the proceeding, 35 9 if it finds that the proceeding has resulted in a substantial 35 10 benefit to the corporation. 35 11 2. Order the plaintiff to pay any defendant's reasonable 35 12 expenses, including attorney fees incurred in defending the 35 13 proceeding, if it finds that the proceeding was commenced or 35 14 maintained without reasonable cause or for an improper 35 15 purpose. 35 16 Sec. 55. NEW SECTION. 504A.638 APPLICABILITY TO FOREIGN 35 17 CORPORATIONS. 35 18 In any derivative proceeding in the right of a foreign 35 19 corporation, the matters covered by this part shall be 35 20 governed by the laws of the jurisdiction of incorporation of 35 21 the foreign corporation except that sections 504A.634, 35 22 504A.636, and 504A.637 shall apply. 35 23 PART 5 35 24 DELEGATES 35 25 Sec. 56. NEW SECTION. 504A.641 DELEGATES. 35 26 1. A corporation may provide in its articles or bylaws for 35 27 delegates having some or all of the authority of members. 35 28 2. The articles or bylaws may set forth provisions 35 29 relating to all of the following: 35 30 a. The characteristics, qualifications, rights, 35 31 limitations, and obligations of delegates including their 35 32 selection and removal. 35 33 b. Calling, noticing, holding, and conducting meetings of 35 34 delegates. 35 35 c. Carrying on corporate activities during and between 36 1 meetings of delegates. 36 2 SUBCHAPTER VII 36 3 MEMBERS' MEETINGS AND VOTING 36 4 PART 1 36 5 MEETINGS AND ACTION WITHOUT MEETINGS 36 6 Sec. 57. NEW SECTION. 504A.701 ANNUAL AND REGULAR 36 7 MEETINGS. 36 8 1. A corporation with members shall hold a membership 36 9 meeting annually at a time stated in or fixed in accordance 36 10 with the bylaws. 36 11 2. A corporation with members may hold regular membership 36 12 meetings at the times stated in or fixed in accordance with 36 13 the bylaws. 36 14 3. Annual or regular membership meetings may be held in or 36 15 out of this state at the place stated in or fixed in 36 16 accordance with the bylaws. If a place is not stated in or 36 17 fixed in accordance with the bylaws, annual and regular 36 18 meetings shall be held at the corporation's principal office. 36 19 4. At the annual meeting all of the following shall occur: 36 20 a. The president and chief financial officer shall report 36 21 on the activities and financial condition of the corporation. 36 22 b. The members shall consider and act upon such other 36 23 matters as may be raised consistent with the notice 36 24 requirements of sections 504A.705 and 504A.713, subsection 4. 36 25 5. At regular meetings, the members shall consider and act 36 26 upon such matters as may be raised consistent with the notice 36 27 requirements of sections 504A.705 and 504A.713, subsection 4. 36 28 6. The failure to hold an annual or regular meeting at a 36 29 time stated in or fixed in accordance with a corporation's 36 30 bylaws does not affect the validity of any corporate action. 36 31 Sec. 58. NEW SECTION. 504A.702 SPECIAL MEETING. 36 32 1. A corporation with members shall hold a special meeting 36 33 of members when either of the following occurs: 36 34 a. At the call of its board or the person or persons 36 35 authorized to do so by the corporation's articles or bylaws. 37 1 b. Except as provided in the articles or bylaws of a 37 2 religious corporation, if the holders of at least five percent 37 3 of the voting power of any corporation sign, date, and deliver 37 4 to any corporate officer one or more written demands for the 37 5 meeting describing the purpose for which it is to be held. 37 6 Unless otherwise provided in the articles of incorporation, a 37 7 written demand for a special meeting may be revoked by a 37 8 writing to that effect received by the corporation prior to 37 9 the receipt by the corporation of demands sufficient in number 37 10 to require the holding of a special meeting. 37 11 2. The close of business on the thirtieth day before 37 12 delivery of the demand for a special meeting to any corporate 37 13 officer is the record date for the purpose of determining 37 14 whether the five percent requirement of subsection 1, 37 15 paragraph "b", has been met. 37 16 3. If a notice for a special meeting demanded under 37 17 subsection 1, paragraph "b", is not given pursuant to section 37 18 504A.705 within thirty days after the date the written demand 37 19 or demands are delivered to a corporate officer, regardless of 37 20 the requirements of subsection 4, a person signing the demand 37 21 may set the time and place of the meeting and give notice 37 22 pursuant to section 504A.705. 37 23 4. Special meetings of members may be held in or out of 37 24 this state at a place stated in or fixed in accordance with 37 25 the bylaws. If a place is not stated or fixed in accordance 37 26 with the bylaws, special meetings shall be held at the 37 27 corporation's principal office. 37 28 5. Only those matters that are within the purpose 37 29 described in the meeting notice required by section 504A.705 37 30 may be considered at a special meeting of members. 37 31 Sec. 59. NEW SECTION. 504A.703 COURT-ORDERED MEETING. 37 32 1. The district court of the county where a corporation's 37 33 principal office is located or, if none is located in this 37 34 state, where its registered office is located, may summarily 37 35 order a meeting to be held when any of the following occurs: 38 1 a. On application of any member or other person entitled 38 2 to participate in an annual or regular meeting of the 38 3 corporation, and in the case of a public benefit corporation, 38 4 the attorney general, if an annual meeting was not held within 38 5 the earlier of six months after the end of the corporation's 38 6 fiscal year or fifteen months after its last annual meeting. 38 7 b. On application of any member or other person entitled 38 8 to participate in a regular meeting of the corporation, and in 38 9 the case of a public benefit corporation, the attorney 38 10 general, if a regular meeting was not held within forty days 38 11 after the date it was required to be held. 38 12 c. On application of a member who signed a demand for a 38 13 special meeting valid under section 504A.702, a person 38 14 entitled to call a special meeting, and in the case of a 38 15 public benefit corporation, the attorney general, if any of 38 16 the following applies: 38 17 (1) The notice of the special meeting was not given within 38 18 thirty days after the date the demand was delivered to a 38 19 corporate officer. 38 20 (2) The special meeting was not held in accordance with 38 21 the notice. 38 22 2. The court may fix the time and place of the meeting, 38 23 specify a record date for determining members entitled to 38 24 notice of and to vote at the meeting, prescribe the form and 38 25 content of the meeting notice, fix the quorum required for 38 26 specific matters to be considered at the meeting or direct 38 27 that the votes represented at the meeting constitute a quorum 38 28 for action on those matters, and enter other orders necessary 38 29 to accomplish the purpose of the meeting. 38 30 3. If the court orders a meeting, it may also order the 38 31 corporation to pay the member's costs, including reasonable 38 32 attorney fees, incurred to obtain the order. 38 33 Sec. 60. NEW SECTION. 504A.704 ACTION BY WRITTEN 38 34 CONSENT. 38 35 1. Unless limited or prohibited by the articles or bylaws 39 1 of the corporation, action required or permitted by this 39 2 subchapter to be approved by the members of a corporation may 39 3 be approved without a meeting of members if the action is 39 4 approved by members holding at least eighty percent of the 39 5 voting power. The action must be evidenced by one or more 39 6 written consents describing the action taken, signed by those 39 7 members representing at least eighty percent of the voting 39 8 power, and delivered to the corporation for inclusion in the 39 9 minutes or filing with the corporate records. A written 39 10 consent may be revoked by a writing to that effect received by 39 11 the corporation prior to the receipt by the corporation of 39 12 unrevoked written consents sufficient in number to take 39 13 corporation action. 39 14 2. If not otherwise determined under section 504A.703 or 39 15 504A.707, the record date for determining members entitled to 39 16 take action without a meeting is the date the first member 39 17 signs the consent under subsection 1. 39 18 3. A consent signed under this section has the effect of a 39 19 meeting vote and may be described as such in any document 39 20 filed with the secretary of state. 39 21 4. Written notice of member approval pursuant to this 39 22 section shall be given to all members who have not signed the 39 23 written consent. If written notice is required, member 39 24 approval pursuant to this section shall be effective ten days 39 25 after such written notice is given. 39 26 Sec. 61. NEW SECTION. 504A.705 NOTICE OF MEETING. 39 27 1. A corporation shall give notice consistent with its 39 28 bylaws of meetings of members in a fair and reasonable manner. 39 29 2. Any notice which conforms to the requirements of 39 30 subsection 3 is fair and reasonable, but other means of giving 39 31 notice may also be fair and reasonable when all the 39 32 circumstances are considered. However, notice of matters 39 33 referred to in subsection 3, paragraph "b", must be given as 39 34 provided in subsection 3. 39 35 3. Notice is fair and reasonable if all of the following 40 1 occur: 40 2 a. The corporation notifies its members of the place, 40 3 date, and time of each annual, regular, and special meeting of 40 4 members not more than sixty days and not less than ten days, 40 5 or if notice is mailed by other than first class or registered 40 6 mail, not less than thirty days, before the date of the 40 7 meeting. 40 8 b. The notice of an annual or regular meeting includes a 40 9 description of any matter or matters which must be considered 40 10 for approval by the members under sections 504A.833, 504A.857, 40 11 504A.1003, 504A.1022, 504A.1104, 504A.1202, 504A.1401, and 40 12 504A.1402. 40 13 c. The notice of a special meeting includes a description 40 14 of the purpose for which the meeting is called. 40 15 4. Unless the bylaws require otherwise, if an annual, 40 16 regular, or special meeting of members is adjourned to a 40 17 different date, time, or place, notice need not be given of 40 18 the new date, time, or place, if the new date, time, or place 40 19 is announced at the meeting before adjournment. If a new 40 20 record date for the adjourned meeting is or must be fixed 40 21 under section 504A.707, however, notice of the adjourned 40 22 meeting must be given under this section to the members of 40 23 record as of the new record date. 40 24 5. When giving notice of an annual, regular, or special 40 25 meeting of members, a corporation shall give notice of a 40 26 matter a member intends to raise at the meeting if requested 40 27 in writing to do so by a person entitled to call a special 40 28 meeting and if the request is received by the secretary or 40 29 president of the corporation at least ten days before the 40 30 corporation gives notice of the meeting. 40 31 Sec. 62. NEW SECTION. 504A.706 WAIVER OF NOTICE. 40 32 1. A member may waive any notice required by this 40 33 subchapter, the articles, or bylaws before or after the date 40 34 and time stated in the notice. The waiver must be in writing, 40 35 be signed by the member entitled to the notice, and be 41 1 delivered to the corporation for inclusion in the minutes or 41 2 filing with the corporate records. 41 3 2. A member's attendance at a meeting does all of the 41 4 following: 41 5 a. Waives objection to lack of notice or defective notice 41 6 of the meeting, unless the member at the beginning of the 41 7 meeting objects to holding the meeting or transacting business 41 8 at the meeting. 41 9 b. Waives objection to consideration of a particular 41 10 matter at the meeting that is not within the purpose described 41 11 in the meeting notice, unless the member objects to 41 12 considering the matter when it is presented. 41 13 Sec. 63. NEW SECTION. 504A.707 RECORD DATE – 41 14 DETERMINING MEMBERS ENTITLED TO NOTICE AND VOTE. 41 15 1. The bylaws of a corporation may fix or provide the 41 16 manner of fixing a date as the record date for determining the 41 17 members entitled to notice of a members' meeting. If the 41 18 bylaws do not fix or provide for fixing such a record date, 41 19 the board may fix a future date as such a record date. If a 41 20 record date is not fixed, members at the close of business on 41 21 the business day preceding the day on which notice is given, 41 22 or if notice is waived, at the close of business on the 41 23 business day preceding the day on which the meeting is held 41 24 are entitled to notice of the meeting. 41 25 2. The bylaws of a corporation may fix or provide the 41 26 manner of fixing a date as the record date for determining the 41 27 members entitled to vote at a members' meeting. If the bylaws 41 28 do not fix or provide for fixing such a record date, the board 41 29 may fix a future date as such a record date. If a record date 41 30 is not fixed, members on the date of the meeting who are 41 31 otherwise eligible to vote are entitled to vote at the 41 32 meeting. 41 33 3. The bylaws may fix or provide the manner for 41 34 determining a date as the record date for the purpose of 41 35 determining the members entitled to exercise any rights in 42 1 respect of any other lawful action. If the bylaws do not fix 42 2 or provide for fixing such a record date, the board may fix in 42 3 advance such a record date. If a record date is not fixed, 42 4 members at the close of business on the day on which the board 42 5 adopts the resolution relating thereto, or the sixtieth day 42 6 prior to the date of such other action, whichever is later, 42 7 are entitled to exercise such rights. 42 8 4. A record date fixed under this section shall not be 42 9 more than seventy days before the meeting or action requiring 42 10 a determination of members occurs. 42 11 5. A determination of members entitled to notice of or to 42 12 vote at a membership meeting is effective for any adjournment 42 13 of the meeting unless the board fixes a new date for 42 14 determining the right to notice or the right to vote, which it 42 15 must do if the meeting is adjourned to a date more than 42 16 seventy days after the record date for determining members 42 17 entitled to notice of the original meeting. 42 18 6. If a court orders a meeting adjourned to a date more 42 19 than one hundred twenty days after the date fixed for the 42 20 original meeting, it may provide that the original record date 42 21 for notice or voting continues in effect or it may fix a new 42 22 record date for notice or voting. 42 23 Sec. 64. NEW SECTION. 504A.708 ACTION BY WRITTEN BALLOT. 42 24 1. Unless prohibited or limited by the articles or bylaws, 42 25 any action which may be taken at any annual, regular, or 42 26 special meeting of members may be taken without a meeting if 42 27 the corporation delivers a written ballot to every member 42 28 entitled to vote on the matter. 42 29 2. A written ballot shall do both of the following: 42 30 a. Set forth each proposed action. 42 31 b. Provide an opportunity to vote for or against each 42 32 proposed action. 42 33 3. Approval by written ballot pursuant to this section 42 34 shall be valid only when the number of votes cast by ballot 42 35 equals or exceeds the quorum required to be present at a 43 1 meeting authorizing the action, and the number of approvals 43 2 equals or exceeds the number of votes that would be required 43 3 to approve the matter at a meeting at which the total number 43 4 of votes cast was the same as the number of votes cast by 43 5 ballot. 43 6 4. All solicitations for votes by written ballot shall do 43 7 all of the following: 43 8 a. Indicate the number of responses needed to meet the 43 9 quorum requirements. 43 10 b. State the percentage of approvals necessary to approve 43 11 each matter other than election of directors. 43 12 c. Specify the time by which a ballot must be received by 43 13 the corporation in order to be counted. 43 14 5. Except as otherwise provided in the articles or bylaws, 43 15 a written ballot shall not be revoked. 43 16 PART 2 43 17 VOTING 43 18 Sec. 65. NEW SECTION. 504A.711 MEMBERS' LIST FOR 43 19 MEETING. 43 20 1. After fixing a record date for a notice of a meeting, a 43 21 corporation shall prepare an alphabetical list of the names of 43 22 all its members who are entitled to notice of the meeting. 43 23 The list must show the address of each member and number of 43 24 votes each member is entitled to cast at the meeting. The 43 25 corporation shall prepare on a current basis through the time 43 26 of the membership meeting a list of members, if any, who are 43 27 entitled to vote at the meeting, but not entitled to notice of 43 28 the meeting. This list shall be prepared on the same basis as 43 29 and be part of the list of members. 43 30 2. The list of members must be available for inspection by 43 31 any member for the purpose of communication with other members 43 32 concerning the meeting, beginning two business days after 43 33 notice is given of the meeting for which the list was prepared 43 34 and continuing through the meeting, at the corporation's 43 35 principal office or at a reasonable place identified in the 44 1 meeting notice in the city where the meeting will be held. A 44 2 member, a member's agent, or a member's attorney is entitled 44 3 on written demand to inspect and, subject to the limitations 44 4 of section 504A.1602, subsection 3, and section 504A.1605, to 44 5 copy the list, at a reasonable time and at the member's 44 6 expense, during the period it is available for inspection. 44 7 3. A corporation shall make the list of members available 44 8 at the meeting, and any member, a member's agent, or a 44 9 member's attorney is entitled to inspect the list at any time 44 10 during the meeting or any adjournment. 44 11 4. If a corporation refuses to allow a member, a member's 44 12 agent, or a member's attorney to inspect the list of members 44 13 before or at the meeting or copy the list as permitted by 44 14 subsection 2, the district court of the county where a 44 15 corporation's principal office is located or, if none is 44 16 located in this state, where its registered office is located, 44 17 on application of the member, may summarily order the 44 18 inspection or copying of the membership list at the 44 19 corporation's expense, may postpone the meeting for which the 44 20 list was prepared until the inspection or copying is complete, 44 21 and may order the corporation to pay the member's costs, 44 22 including reasonable attorney fees incurred to obtain the 44 23 order. 44 24 5. Unless a written demand to inspect and copy a 44 25 membership list has been made under subsection 2 prior to the 44 26 membership meeting and a corporation improperly refuses to 44 27 comply with the demand, refusal or failure to comply with this 44 28 section does not affect the validity of action taken at the 44 29 meeting. 44 30 6. The articles or bylaws of a religious corporation may 44 31 limit or abolish the rights of a member under this section to 44 32 inspect and copy any corporate record. 44 33 Sec. 66. NEW SECTION. 504A.712 VOTING ENTITLEMENT 44 34 GENERALLY. 44 35 1. The right of the members of a corporation, or any class 45 1 or classes of members, to vote may be limited, enlarged, or 45 2 denied to the extent specified in the articles of 45 3 incorporation or, if the articles of incorporation so provide, 45 4 by the bylaws. Unless so limited, enlarged, or denied, each 45 5 member, regardless of class, shall be entitled to one vote on 45 6 each matter submitted to a vote of members. 45 7 2. Unless the articles or bylaws provide otherwise, if a 45 8 membership stands of record in the names of two or more 45 9 persons, the persons' acts with respect to voting shall have 45 10 the following effect: 45 11 a. If only one votes, such act binds all. 45 12 b. If more than one votes, the vote shall be divided on a 45 13 pro rata basis. 45 14 Sec. 67. NEW SECTION. 504A.713 QUORUM REQUIREMENTS. 45 15 1. Unless this subchapter, or the articles or bylaws of a 45 16 corporation provide for a higher or lower quorum, ten percent 45 17 of the votes entitled to be cast on a matter must be 45 18 represented at a meeting of members to constitute a quorum on 45 19 that matter. 45 20 2. A bylaw amendment to decrease the quorum for any member 45 21 action may be approved by the members or, unless prohibited by 45 22 the bylaws, by the board. 45 23 3. A bylaw amendment to increase the quorum required for 45 24 any member action must be approved by the members. 45 25 4. Unless one-third or more of the voting power is present 45 26 in person or by proxy, the only matters that may be voted upon 45 27 at an annual or regular meeting of members are those matters 45 28 that are described in the meeting notice. 45 29 Sec. 68. NEW SECTION. 504A.714 VOTING REQUIREMENTS. 45 30 1. Unless this subchapter, or the articles or bylaws of a 45 31 corporation require a greater vote or voting by class, if a 45 32 quorum is present, the affirmative vote of the votes 45 33 represented and voting, which affirmative votes also 45 34 constitute a majority of the required quorum, is the act of 45 35 the members. 46 1 2. A bylaw amendment to increase or decrease the vote 46 2 required for any member action must be approved by the 46 3 members. 46 4 Sec. 69. NEW SECTION. 504A.715 PROXIES. 46 5 1. Unless the articles or bylaws of a corporation prohibit 46 6 or limit proxy voting, a member or the member's agent or 46 7 attorney in fact may appoint a proxy to vote or otherwise act 46 8 for the member by signing an appointment form or by an 46 9 electronic transmission. An electronic transmission must 46 10 contain or be accompanied by information from which it can be 46 11 determined that the member, the member's agent, or the 46 12 member's attorney in fact authorized the electronic 46 13 transmission. 46 14 2. An appointment of a proxy is effective when a signed 46 15 appointment form or an electronic transmission of an 46 16 appointment form is received by the secretary or other officer 46 17 or agent authorized to tabulate votes. An appointment is 46 18 valid for eleven months unless a different period is expressly 46 19 provided for in the appointment. However, a proxy shall not 46 20 be valid for more than three years from its date of execution. 46 21 3. An appointment of a proxy is revocable by the member. 46 22 4. The death or incapacity of the member appointing a 46 23 proxy does not affect the right of the corporation to accept 46 24 the proxy's authority unless notice of the death or incapacity 46 25 is received by the secretary or other officer or agent 46 26 authorized to tabulate votes before the proxy exercises 46 27 authority under the appointment. 46 28 5. Appointment of a proxy is revoked by the person 46 29 appointing the proxy if either of the following occurs: 46 30 a. The person appointing the proxy attends any meeting and 46 31 votes in person. 46 32 b. The person appointing the proxy signs and delivers or 46 33 sends through electronic transmission to the secretary or 46 34 other officer or agent authorized to tabulate proxy votes 46 35 either a writing or electronic transmission stating that the 47 1 appointment of the proxy is revoked or a subsequent 47 2 appointment. 47 3 6. Subject to section 504A.718 and any express limitation 47 4 on the proxy's authority appearing on the face of the 47 5 appointment form, a corporation is entitled to accept the 47 6 proxy's vote or other action as that of the member making the 47 7 appointment. 47 8 Sec. 70. NEW SECTION. 504A.716 CUMULATIVE VOTING FOR 47 9 DIRECTORS. 47 10 1. If the articles or bylaws of a corporation provide for 47 11 cumulative voting by members, members may so vote, by 47 12 multiplying the number of votes the members are entitled to 47 13 cast by the number of directors for whom they are entitled to 47 14 vote, and casting the product for a single candidate or 47 15 distributing the product among two or more candidates. 47 16 2. A director elected by cumulative voting may be removed 47 17 by the members without cause if the requirements of section 47 18 504A.808 are met unless the votes cast against removal, or not 47 19 consenting in writing to such removal, would be sufficient to 47 20 elect such director if voted cumulatively at an election at 47 21 which the same total number of votes were cast or, if such 47 22 action is taken by written ballot, all memberships entitled to 47 23 vote were voted, and the entire number of directors authorized 47 24 at the time of the director's most recent election were then 47 25 being elected. 47 26 3. Members shall not cumulatively vote if the directors 47 27 and members are identical. 47 28 Sec. 71. NEW SECTION. 504A.717 OTHER METHODS OF ELECTING 47 29 DIRECTORS. 47 30 A corporation may provide in its articles or bylaws for 47 31 election of directors by members or delegates on the basis of 47 32 chapter or other organizational unit, by region or other 47 33 geographic unit, by preferential voting, or by any other 47 34 reasonable method. 47 35 Sec. 72. NEW SECTION. 504A.718 CORPORATION'S ACCEPTANCE 48 1 OF VOTES. 48 2 1. If the name signed on a vote, consent, waiver, or proxy 48 3 appointment corresponds to the name of a member, the 48 4 corporation if acting in good faith is entitled to accept the 48 5 vote, consent, waiver, or proxy appointment and give it effect 48 6 as the act of the member. 48 7 2. If the name signed on a vote, consent, waiver, or proxy 48 8 appointment does not correspond to the record name of a 48 9 member, the corporation if acting in good faith is 48 10 nevertheless entitled to accept the vote, consent, waiver, or 48 11 proxy appointment and give it effect as the act of the member 48 12 if any of the following is applicable: 48 13 a. The member is an entity and the name signed purports to 48 14 be that of an officer or agent of the entity. 48 15 b. The name signed purports to be that of an attorney in 48 16 fact of the member and if the corporation requests, evidence 48 17 acceptable to the corporation of the signatory's authority to 48 18 sign for the member has been presented with respect to the 48 19 vote, consent, waiver, or proxy appointment. 48 20 c. Two or more persons hold the membership as cotenants or 48 21 fiduciaries and the name signed purports to be the name of at 48 22 least one of the coholders and the person signing appears to 48 23 be acting on behalf of all the coholders. 48 24 d. In the case of a mutual benefit corporation: 48 25 (1) The name signed purports to be that of an 48 26 administrator, executor, guardian, or conservator representing 48 27 the member and, if the corporation requests, evidence of 48 28 fiduciary status acceptable to the corporation has been 48 29 presented with respect to the vote, consent, waiver, or proxy 48 30 appointment. 48 31 (2) The name signed purports to be that of a receiver or 48 32 trustee in bankruptcy of the member, and, if the corporation 48 33 requests, evidence of this status acceptable to the 48 34 corporation has been presented with respect to the vote, 48 35 consent, waiver, or proxy appointment. 49 1 3. The corporation is entitled to reject a vote, consent, 49 2 waiver, or proxy appointment if the secretary or other officer 49 3 or agent authorized to tabulate votes, acting in good faith, 49 4 has reasonable basis for doubt about the validity of the 49 5 signature on it or about the signatory's authority to sign for 49 6 the member. 49 7 4. The corporation and its officer or agent who accepts or 49 8 rejects a vote, consent, waiver, or proxy appointment in good 49 9 faith and in accordance with the standards of this section are 49 10 not liable in damages to the member for the consequences of 49 11 the acceptance or rejection. 49 12 5. Corporate action based on the acceptance or rejection 49 13 of a vote, consent, waiver, or proxy appointment under this 49 14 section is valid unless a court of competent jurisdiction 49 15 determines otherwise. 49 16 PART 3 49 17 VOTING AGREEMENTS 49 18 Sec. 73. NEW SECTION. 504A.721 VOTING AGREEMENTS. 49 19 1. Two or more members of a corporation may provide for 49 20 the manner in which they will vote by signing an agreement for 49 21 that purpose. For public benefit corporations, such 49 22 agreements must have a reasonable purpose not inconsistent 49 23 with the corporation's public or charitable purposes. 49 24 2. A voting agreement created under this section is 49 25 specifically enforceable. 49 26 SUBCHAPTER VIII 49 27 DIRECTORS AND OFFICERS 49 28 PART 1 49 29 BOARD OF DIRECTORS 49 30 Sec. 74. NEW SECTION. 504A.801 REQUIREMENT FOR AND 49 31 DUTIES OF BOARD. 49 32 1. Each corporation must have a board of directors. 49 33 2. Except as otherwise provided in this subchapter or 49 34 subsection 3, all corporate powers shall be exercised by or 49 35 under the authority of, and the affairs of the corporation 50 1 managed under the direction of, its board. 50 2 3. The articles of incorporation may authorize a person or 50 3 persons to exercise some or all of the powers which would 50 4 otherwise be exercised by a board. To the extent so 50 5 authorized, any such person or persons shall have the duties 50 6 and responsibilities of the directors, and the directors shall 50 7 be relieved to that extent from such duties and 50 8 responsibilities. 50 9 Sec. 75. NEW SECTION. 504A.802 QUALIFICATIONS OF 50 10 DIRECTORS. 50 11 All directors of a corporation must be individuals. The 50 12 articles or bylaws may prescribe other qualifications for 50 13 directors. 50 14 Sec. 76. NEW SECTION. 504A.803 NUMBER OF DIRECTORS. 50 15 1. The board of directors of a corporation must consist of 50 16 one or more individuals, with the number specified in or fixed 50 17 in accordance with the articles or bylaws. 50 18 2. The number of directors may be increased or decreased 50 19 from time to time by amendment to or in the manner prescribed 50 20 in the articles or bylaws. 50 21 Sec. 77. NEW SECTION. 504A.804 ELECTION, DESIGNATION, 50 22 AND APPOINTMENT OF DIRECTORS. 50 23 1. If the corporation has members, all the directors, 50 24 except the initial directors, shall be elected at the first 50 25 annual meeting of members, and at each annual meeting 50 26 thereafter, unless the articles or bylaws provide some other 50 27 time or method of election, or provide that some of the 50 28 directors are appointed by some other person or designated. 50 29 2. If a corporation does not have members, all the 50 30 directors, except the initial directors, shall be elected, 50 31 appointed, or designated as provided in the articles or 50 32 bylaws. If no method of designation or appointment is set 50 33 forth in the articles or bylaws, the directors other than the 50 34 initial directors shall be elected by the board. 50 35 Sec. 78. NEW SECTION. 504A.805 TERMS OF DIRECTORS 51 1 GENERALLY. 51 2 1. The articles or bylaws of a corporation must specify 51 3 the terms of directors. Except for designated or appointed 51 4 directors, and except as otherwise provided in the articles or 51 5 bylaws, the terms of directors shall not exceed five years. 51 6 In the absence of any term specified in the articles or 51 7 bylaws, the term of each director shall be one year. 51 8 Directors may be elected for successive terms. 51 9 2. A decrease in the number or term of directors does not 51 10 shorten an incumbent director's term. 51 11 3. Except as provided in the articles or bylaws, both of 51 12 the following apply: 51 13 a. The term of a director filling a vacancy in the office 51 14 of a director elected by members expires at the next election 51 15 of directors by members. 51 16 b. The term of a director filling any other vacancy 51 17 expires at the end of the unexpired term which such director 51 18 is filling. 51 19 4. Despite the expiration of a director's term, the 51 20 director continues to serve until the director's successor is 51 21 elected, designated, or appointed, and qualifies, or until 51 22 there is a decrease in the number of directors. 51 23 Sec. 79. NEW SECTION. 504A.806 STAGGERED TERMS FOR 51 24 DIRECTORS. 51 25 The articles or bylaws of a corporation may provide for 51 26 staggering the terms of directors by dividing the total number 51 27 of directors into groups. The terms of the several groups 51 28 need not be uniform. 51 29 Sec. 80. NEW SECTION. 504A.807 RESIGNATION OF DIRECTORS. 51 30 1. A director of a corporation may resign at any time by 51 31 delivering written notice to the board of directors, its 51 32 presiding officer, or the president or secretary. 51 33 2. A resignation is effective when the notice is effective 51 34 unless the notice specifies a later effective date. If a 51 35 resignation is made effective at a later date, the board may 52 1 fill the pending vacancy before the effective date if the 52 2 board provides that the successor does not take office until 52 3 the effective date. 52 4 Sec. 81. NEW SECTION. 504A.808 REMOVAL OF DIRECTORS 52 5 ELECTED BY MEMBERS OR DIRECTORS. 52 6 1. The members of a corporation may remove one or more 52 7 directors elected by the members without cause. 52 8 2. If a director is elected by a class, chapter, or other 52 9 organizational unit or by region or other geographic grouping, 52 10 the director may be removed only by the members of that class, 52 11 chapter, unit, or grouping. 52 12 3. Except as provided in subsection 9, a director may be 52 13 removed under subsection 1 or 2 only if the number of votes 52 14 cast to remove the director would be sufficient to elect the 52 15 director at a meeting to elect directors. 52 16 4. If cumulative voting is authorized, a director shall 52 17 not be removed if the number of votes, or if the director was 52 18 elected by a class, chapter, unit, or grouping of members, the 52 19 number of votes of that class, chapter, unit, or grouping, 52 20 sufficient to elect the director under cumulative voting, is 52 21 voted against the director's removal. 52 22 5. A director elected by members may be removed by the 52 23 members only at a meeting called for the purpose of removing 52 24 the director and the meeting notice must state that the 52 25 purpose, or one of the purposes, of the meeting is the removal 52 26 of the director. 52 27 6. For the purpose of computing whether a director is 52 28 protected from removal under subsections 2 through 4, it 52 29 should be assumed that the votes against removal are cast in 52 30 an election for the number of directors of the group to which 52 31 the director to be removed belonged on the date of that 52 32 director's election. 52 33 7. An entire board of directors may be removed under 52 34 subsections 1 through 5. 52 35 8. A director elected by the board may be removed without 53 1 cause by the vote of two-thirds of the directors then in 53 2 office or such greater number as is set forth in the articles 53 3 or bylaws. However, a director elected by the board to fill 53 4 the vacancy of a director elected by the members may be 53 5 removed without cause by the members, but not by the board. 53 6 9. If at the beginning of a director's term on the board 53 7 the articles or bylaws provide that a director may be removed 53 8 for missing a specified number of board meetings, the board 53 9 may remove the director for failing to attend the specified 53 10 number of meetings. The director may be removed only if a 53 11 majority of the directors then in office votes for the 53 12 removal. 53 13 10. The articles or bylaws of a religious corporation may 53 14 do both of the following: 53 15 a. Limit the application of this section. 53 16 b. Set forth the vote and procedures by which the board or 53 17 any person may remove with or without cause a director elected 53 18 by the members or the board. 53 19 Sec. 82. NEW SECTION. 504A.809 REMOVAL OF DESIGNATED OR 53 20 APPOINTED DIRECTORS. 53 21 1. A designated director of a corporation may be removed 53 22 by an amendment to the articles or bylaws deleting or changing 53 23 the designation. 53 24 2. a. Except as otherwise provided in the articles or 53 25 bylaws, an appointed director may be removed without cause by 53 26 the person appointing the director. 53 27 b. The person removing the appointed director shall do so 53 28 by giving written notice of the removal to the director and 53 29 either the presiding officer of the board or the corporation's 53 30 president or secretary. 53 31 c. A removal of an appointed director is effective when 53 32 the notice is effective unless the notice specifies a future 53 33 effective date. 53 34 Sec. 83. NEW SECTION. 504A.810 REMOVAL OF DIRECTORS BY 53 35 JUDICIAL PROCEEDING. 54 1 1. The district court of the county where a corporation's 54 2 principal office is located may remove any director of the 54 3 corporation from office in a proceeding commenced either by 54 4 the corporation, its members holding at least twenty percent 54 5 of the voting power of any class, or the attorney general in 54 6 the case of a public benefit corporation if the court finds 54 7 both of the following: 54 8 a. The director engaged in fraudulent or dishonest conduct 54 9 with respect to the corporation, or a final judgment has been 54 10 entered finding that the director has violated a duty set 54 11 forth in sections 504A.831 through 504A.835. 54 12 b. Removal is in the best interest of the corporation. 54 13 2. The court that removes a director may bar the director 54 14 from serving on the board for a period prescribed by the 54 15 court. 54 16 3. If members or the attorney general commence a 54 17 proceeding under subsection 1, the corporation shall be made a 54 18 party defendant. 54 19 4. If a public benefit corporation or its members commence 54 20 a proceeding under subsection 1, they shall give the attorney 54 21 general written notice of the proceeding. 54 22 5. The articles or bylaws of a religious corporation may 54 23 limit or prohibit the application of this section. 54 24 Sec. 84. NEW SECTION. 504A.811 VACANCY ON BOARD. 54 25 1. Unless the articles or bylaws of a corporation provide 54 26 otherwise, and except as provided in subsections 2 and 3, if a 54 27 vacancy occurs on the board of directors, including a vacancy 54 28 resulting from an increase in the number of directors, any of 54 29 the following may occur: 54 30 a. The members, if any, may fill the vacancy. If the 54 31 vacant office was held by a director elected by a class, 54 32 chapter, or other organizational unit or by region or other 54 33 geographic grouping, only members of the class, chapter, unit, 54 34 or grouping are entitled to vote to fill the vacancy if it is 54 35 filled by the members. 55 1 b. The board of directors may fill the vacancy. 55 2 c. If the directors remaining in office constitute fewer 55 3 than a quorum of the board, they may fill the vacancy by the 55 4 affirmative vote of a majority of all the directors remaining 55 5 in office. 55 6 2. Unless the articles or bylaws provide otherwise, if a 55 7 vacant office was held by an appointed director, only the 55 8 person who appointed the director may fill the vacancy. 55 9 3. If a vacant office was held by a designated director, 55 10 the vacancy shall be filled as provided in the articles or 55 11 bylaws. In the absence of an applicable article or bylaw 55 12 provision, the vacancy shall be filled by the board. 55 13 4. A vacancy that will occur at a specific later date by 55 14 reason of a resignation effective at a later date under 55 15 section 504A.807, subsection 2, or otherwise, may be filled 55 16 before the vacancy occurs, but the new director shall not take 55 17 office until the vacancy occurs. 55 18 Sec. 85. NEW SECTION. 504A.812 COMPENSATION OF 55 19 DIRECTORS. 55 20 Unless the articles or bylaws of a corporation provide 55 21 otherwise, a board of directors may fix the compensation of 55 22 directors. 55 23 PART 2 55 24 MEETINGS AND ACTION OF THE BOARD 55 25 Sec. 86. NEW SECTION. 504A.821 REGULAR AND SPECIAL 55 26 MEETINGS. 55 27 1. If the time and place of a directors' meeting is fixed 55 28 by the bylaws or the board, the meeting is a regular meeting. 55 29 All other meetings are special meetings. 55 30 2. A board of directors may hold regular or special 55 31 meetings in or out of this state. 55 32 3. Unless the articles or bylaws provide otherwise, a 55 33 board may permit any or all directors to participate in a 55 34 regular or special meeting by, or conduct the meeting through 55 35 the use of, any means of communication by which all directors 56 1 participating may simultaneously hear each other during the 56 2 meeting. A director participating in a meeting by this means 56 3 is deemed to be present in person at the meeting. 56 4 Sec. 87. NEW SECTION. 504A.822 ACTION WITHOUT MEETING. 56 5 1. Except to the extent the articles or bylaws of a 56 6 corporation require that action by the board of directors be 56 7 taken at a meeting, action required or permitted by this 56 8 subchapter to be taken by the board of directors may be taken 56 9 without a meeting if each director signs a consent describing 56 10 the action to be taken, and delivers it to the corporation. 56 11 2. Action taken under this section is the act of the board 56 12 of directors when one or more consents signed by all the 56 13 directors are delivered to the corporation. The consent may 56 14 specify the time at which the action taken is to be effective. 56 15 A director's consent may be withdrawn by revocation signed by 56 16 the director and delivered to the corporation prior to the 56 17 delivery to the corporation of unrevoked written consents 56 18 signed by all of the directors. 56 19 3. A consent signed under this section has the effect of 56 20 action taken at a meeting of the board of directors and may be 56 21 described as such in any document. 56 22 Sec. 88. NEW SECTION. 504A.823 CALL AND NOTICE OF 56 23 MEETINGS. 56 24 1. Unless the articles or bylaws of a corporation, or 56 25 subsection 3, provide otherwise, regular meetings of the board 56 26 may be held without notice. 56 27 2. Unless the articles, bylaws, or subsection 3 provide 56 28 otherwise, special meetings of the board must be preceded by 56 29 at least two days' notice to each director of the date, time, 56 30 and place, but not the purpose, of the meeting. 56 31 3. In corporations without members, any board action to 56 32 remove a director or to approve a matter which would require 56 33 approval by the members if the corporation had members shall 56 34 not be valid unless each director is given at least seven 56 35 days' written notice that the matter will be voted upon at a 57 1 directors' meeting or unless notice is waived pursuant to 57 2 section 504A.824. 57 3 4. Unless the articles or bylaws provide otherwise, the 57 4 presiding officer of the board, the president, or twenty 57 5 percent of the directors then in office may call and give 57 6 notice of a meeting of the board. 57 7 Sec. 89. NEW SECTION. 504A.824 WAIVER OF NOTICE. 57 8 1. A director may at any time waive any notice required by 57 9 this subchapter, the articles, or bylaws. Except as provided 57 10 in subsection 2, the waiver must be in writing, signed by the 57 11 director entitled to the notice, and filed with the minutes or 57 12 the corporate records. 57 13 2. A director's attendance at or participation in a 57 14 meeting waives any required notice of the meeting unless the 57 15 director, upon arriving at the meeting or prior to the vote on 57 16 a matter not noticed in conformity with this subchapter, the 57 17 articles, or bylaws, objects to lack of notice and does not 57 18 thereafter vote for or assent to the objected-to action. 57 19 Sec. 90. NEW SECTION. 504A.825 QUORUM AND VOTING. 57 20 1. Except as otherwise provided in this subchapter, or the 57 21 articles or bylaws of a corporation, a quorum of a board of 57 22 directors consists of a majority of the directors in office 57 23 immediately before a meeting begins. The articles or bylaws 57 24 shall not authorize a quorum of fewer than one-third of the 57 25 number of directors in office. 57 26 2. If a quorum is present when a vote is taken, the 57 27 affirmative vote of a majority of directors present is the act 57 28 of the board unless this subchapter, the articles, or bylaws 57 29 require the vote of a greater number of directors. 57 30 Sec. 91. NEW SECTION. 504A.826 COMMITTEES OF THE BOARD. 57 31 1. Unless prohibited or limited by the articles or bylaws 57 32 of a corporation, the board of directors may create one or 57 33 more committees of the board and appoint members of the board 57 34 to serve on them. Each committee shall have two or more 57 35 directors, who serve at the pleasure of the board. 58 1 2. The creation of a committee and appointment of members 58 2 to it must be approved by the greater of either of the 58 3 following: 58 4 a. A majority of all the directors in office when the 58 5 action is taken. 58 6 b. The number of directors required by the articles or 58 7 bylaws to take action under section 504A.825. 58 8 3. Sections 504A.821 through 504A.825, which govern 58 9 meetings, action without meetings, notice and waiver of 58 10 notice, and quorum and voting requirements of the board, apply 58 11 to committees of the board and their members as well. 58 12 4. To the extent specified by the board of directors or in 58 13 the articles or bylaws, each committee of the board may 58 14 exercise the board's authority under section 504A.801. 58 15 5. A committee of the board shall not, however, do any of 58 16 the following: 58 17 a. Authorize distributions. 58 18 b. Approve or recommend to members dissolution, merger, or 58 19 the sale, pledge, or transfer of all or substantially all of 58 20 the corporation's assets. 58 21 c. Elect, appoint, or remove directors or fill vacancies 58 22 on the board or on any of its committees. 58 23 d. Adopt, amend, or repeal the articles or bylaws. 58 24 6. The creation of, delegation of authority to, or action 58 25 by a committee does not alone constitute compliance by a 58 26 director with the standards of conduct described in section 58 27 504A.831. 58 28 PART 3 58 29 STANDARDS OF CONDUCT 58 30 Sec. 92. NEW SECTION. 504A.831 GENERAL STANDARDS FOR 58 31 DIRECTORS. 58 32 1. Each member of the board of directors of a corporation, 58 33 when discharging the duties of a director, shall act in 58 34 conformity with all of the following: 58 35 a. In good faith. 59 1 b. In a manner the director reasonably believes to be in 59 2 the best interests of the corporation. 59 3 2. The members of the board of directors or a committee of 59 4 the board, when becoming informed in connection with their 59 5 decision-making functions, shall discharge their duties with 59 6 the care that a person in a like position would reasonably 59 7 believe appropriate under similar circumstances. 59 8 3. In discharging board or committee duties, a director 59 9 who does not have knowledge that makes reliance unwarranted is 59 10 entitled to rely on the performance by any of the persons 59 11 specified in subsection 5, paragraph "a", to whom the board 59 12 may have delegated, formally or informally by course of 59 13 conduct, the authority or duty to perform one or more of the 59 14 board's functions that are delegable under applicable law. 59 15 4. In discharging board or committee duties, a director is 59 16 entitled to rely on information, opinions, reports, or 59 17 statements, including financial statements and other financial 59 18 data, if prepared or presented by any of the persons specified 59 19 in subsection 5. 59 20 5. A director is entitled to rely, in accordance with 59 21 subsection 3 or 4, on any of the following: 59 22 a. One or more officers or employees of the corporation 59 23 whom the director reasonably believes to be reliable and 59 24 competent in the functions performed or the information, 59 25 opinions, reports, or statements provided by the officer or 59 26 employee. 59 27 b. Legal counsel, public accountants, or other persons as 59 28 to matters involving skills or expertise the director 59 29 reasonably believes are either of the following: 59 30 (1) Matters within the particular person's professional or 59 31 expert competence. 59 32 (2) Matters as to which the particular person merits 59 33 confidence. 59 34 c. A committee of the board of which the director is not a 59 35 member, as to matters within its jurisdiction, if the director 60 1 reasonably believes the committee merits confidence. 60 2 d. In the case of religious corporations, religious 60 3 authorities and ministers, priests, rabbis, or other persons 60 4 whose position or duties in the religious organization the 60 5 director believes justify reliance and confidence and whom the 60 6 director believes to be reliable and competent in the matters 60 7 presented. 60 8 6. A director shall not be deemed to be a trustee with 60 9 respect to the corporation or with respect to any property 60 10 held or administered by the corporation, including without 60 11 limit, property that may be subject to restrictions imposed by 60 12 the donor or transferor of such property. 60 13 Sec. 93. NEW SECTION. 504A.832 STANDARDS OF LIABILITY 60 14 FOR DIRECTORS. 60 15 1. A director shall not be liable to the corporation or 60 16 its members for any decision to take or not to take action, or 60 17 any failure to take any action, as director, unless the party 60 18 asserting liability in a proceeding establishes both of the 60 19 following: 60 20 a. That section 504A.901 or the protection afforded by 60 21 section 504A.831, if interposed as a bar to the proceeding by 60 22 the director, does not preclude liability. 60 23 b. That the challenged conduct consisted or was the result 60 24 of one of the following: 60 25 (1) Action not in good faith. 60 26 (2) A decision that satisfies one of the following: 60 27 (a) That the director did not reasonably believe to be in 60 28 the best interests of the corporation. 60 29 (b) As to which the director was not informed to an extent 60 30 the director reasonably believed appropriate in the 60 31 circumstances. 60 32 (3) A lack of objectivity due to the director's familial, 60 33 financial, or business relationship with, or lack of 60 34 independence due to the director's domination or control by, 60 35 another person having a material interest in the challenged 61 1 conduct which also meets both of the following criteria: 61 2 (a) Which relationship or which domination or control 61 3 could reasonably be expected to have affected the director's 61 4 judgment respecting the challenged conduct in a manner adverse 61 5 to the corporation. 61 6 (b) After a reasonable expectation to such effect has been 61 7 established, the director shall not have established that the 61 8 challenged conduct was reasonably believed by the director to 61 9 be in the best interests of the corporation. 61 10 (4) A sustained failure of the director to devote 61 11 attention to ongoing oversight of the business and affairs of 61 12 the corporation, or a failure to devote timely attention, by 61 13 making, or causing to be made, appropriate inquiry, when 61 14 particular facts and circumstances of significant concern 61 15 materialize that would alert a reasonably attentive director 61 16 to the need therefor. 61 17 (5) Receipt of a financial benefit to which the director 61 18 was not entitled or any other breach of the director's duties 61 19 to deal fairly with the corporation and its members that is 61 20 actionable under applicable law. 61 21 2. a. The party seeking to hold the director liable for 61 22 money damages shall also have the burden of establishing both 61 23 of the following: 61 24 (1) That harm to the corporation or its members has been 61 25 suffered. 61 26 (2) The harm suffered was proximately caused by the 61 27 director's challenged conduct. 61 28 b. A party seeking to hold the director liable for other 61 29 money payment under a legal remedy, such as compensation for 61 30 the unauthorized use of corporate assets, shall also have 61 31 whatever persuasion burden may be called for to establish that 61 32 the payment sought is appropriate in the circumstances. 61 33 c. A party seeking to hold the director liable for other 61 34 money payment under an equitable remedy, such as profit 61 35 recovery by or disgorgement to the corporation, shall also 62 1 have whatever persuasion burden may be called for to establish 62 2 that the equitable remedy sought is appropriate in the 62 3 circumstances. 62 4 3. This section shall not do any of the following: 62 5 a. In any instance where fairness is at issue, such as 62 6 consideration of the fairness of a transaction to the 62 7 corporation under section 504A.833, alter the burden of 62 8 proving the fact or lack of fairness otherwise applicable. 62 9 b. Alter the fact or lack of liability of a director under 62 10 another section of this chapter, such as the provisions 62 11 governing the consequences of a transactional interest under 62 12 section 504A.833 or an unlawful distribution under section 62 13 504A.835. 62 14 c. Affect any rights to which the corporation or a 62 15 shareholder may be entitled under another statute of this 62 16 state or the United States. 62 17 Sec. 94. NEW SECTION. 504A.833 DIRECTOR CONFLICT OF 62 18 INTEREST. 62 19 1. A conflict of interest transaction is a transaction 62 20 with the corporation in which a director of the corporation 62 21 has a direct or indirect interest. A conflict of interest 62 22 transaction is not voidable by the corporation on the basis of 62 23 the director's interest in the transaction if the transaction 62 24 was fair at the time it was entered into or is approved as 62 25 provided in subsection 2 or 3. 62 26 2. A transaction in which a director of a public benefit 62 27 or religious corporation has a conflict of interest may be 62 28 approved in either of the following ways: 62 29 a. In advance by the vote of the board of directors or a 62 30 committee of the board if both of the following occur: 62 31 (1) The material facts of the transaction and the 62 32 director's interest are disclosed or known to the board or 62 33 committee of the board. 62 34 (2) The directors approving the transaction in good faith 62 35 reasonably believe that the transaction is fair to the 63 1 corporation. 63 2 b. Before or after the transaction is consummated by 63 3 obtaining approval of either of the following: 63 4 (1) The attorney general. 63 5 (2) The district court in an action in which the attorney 63 6 general is joined as a party. 63 7 3. A transaction in which a director of a mutual benefit 63 8 corporation has a conflict of interest may be approved if 63 9 either of the following occurs: 63 10 a. The material facts of the transaction and the 63 11 director's interest were disclosed or known to the board of 63 12 directors or a committee of the board and the board or 63 13 committee of the board authorized, approved, or ratified the 63 14 transaction. 63 15 b. The material facts of the transaction and the 63 16 director's interest were disclosed or known to the members and 63 17 they authorized, approved, or ratified the transaction. 63 18 4. For the purposes of this section, a director of the 63 19 corporation has an indirect interest in a transaction under 63 20 either of the following circumstances: 63 21 a. If another entity in which the director has a material 63 22 interest or in which the director is a general partner is a 63 23 party to the transaction. 63 24 b. If another entity of which the director is a director, 63 25 officer, or trustee is a party to the transaction. 63 26 5. For purposes of subsections 2 and 3, a conflict of 63 27 interest transaction is authorized, approved, or ratified if 63 28 it receives the affirmative vote of a majority of the 63 29 directors on the board or on a committee of the board, who 63 30 have no direct or indirect interest in the transaction, but a 63 31 transaction shall not be authorized, approved, or ratified 63 32 under this section by a single director. If a majority of the 63 33 directors on the board who have no direct or indirect interest 63 34 in the transaction vote to authorize, approve, or ratify the 63 35 transaction, a quorum is present for the purpose of taking 64 1 action under this section. The presence of, or a vote cast 64 2 by, a director with a direct or indirect interest in the 64 3 transaction does not affect the validity of any action taken 64 4 under subsection 2, paragraph "a", or subsection 3, paragraph 64 5 "a", if the transaction is otherwise approved as provided in 64 6 subsection 2 or 3. 64 7 6. For purposes of subsection 3, paragraph "b", a conflict 64 8 of interest transaction is authorized, approved, or ratified 64 9 by the members if it receives a majority of the votes entitled 64 10 to be counted under this subsection. Votes cast by or voted 64 11 under the control of a director who has a direct or indirect 64 12 interest in the transaction, and votes cast by or voted under 64 13 the control of an entity described in subsection 4, paragraph 64 14 "a", shall not be counted in a vote of members to determine 64 15 whether to authorize, approve, or ratify a conflict of 64 16 interest transaction under subsection 3, paragraph "b". The 64 17 vote of these members, however, is counted in determining 64 18 whether the transaction is approved under other sections of 64 19 this subchapter. A majority of the voting power, whether or 64 20 not present, that is entitled to be counted in a vote on the 64 21 transaction under this subsection constitutes a quorum for the 64 22 purpose of taking action under this section. 64 23 7. The articles, bylaws, or a resolution of the board may 64 24 impose additional requirements on conflict of interest 64 25 transactions. 64 26 Sec. 95. NEW SECTION. 504A.834 LOANS TO OR GUARANTEES 64 27 FOR DIRECTORS AND OFFICERS. 64 28 1. A corporation shall not lend money to or guarantee the 64 29 obligation of a director or officer of the corporation. 64 30 2. The fact that a loan or guarantee is made in violation 64 31 of this section does not affect the borrower's liability on 64 32 the loan. 64 33 Sec. 96. NEW SECTION. 504A.835 LIABILITY FOR UNLAWFUL 64 34 DISTRIBUTIONS. 64 35 1. Unless a director complies with the applicable 65 1 standards of conduct described in section 504A.831, a director 65 2 who votes for or assents to a distribution made in violation 65 3 of this subchapter is personally liable to the corporation for 65 4 the amount of the distribution that exceeds what could have 65 5 been distributed without violating this subchapter. 65 6 2. A director held liable for an unlawful distribution 65 7 under subsection 1 is entitled to contribution from both of 65 8 the following: 65 9 a. Every other director who voted for or assented to the 65 10 distribution without complying with the applicable standards 65 11 of conduct described in section 504A.831. 65 12 b. Each person who received an unlawful distribution for 65 13 the amount of the distribution whether or not the person 65 14 receiving the distribution knew it was made in violation of 65 15 this subchapter. 65 16 PART 4 65 17 OFFICERS 65 18 Sec. 97. NEW SECTION. 504A.841 REQUIRED OFFICERS. 65 19 1. Unless otherwise provided in the articles or bylaws of 65 20 a corporation, a corporation shall have a president, a 65 21 secretary, a treasurer, and such other officers as are 65 22 appointed by the board. An officer may appoint one or more 65 23 officers if authorized by the bylaws or the board of 65 24 directors. 65 25 2. The bylaws or the board shall delegate to one of the 65 26 officers responsibility for preparing minutes of the 65 27 directors' and members' meetings and for authenticating 65 28 records of the corporation. 65 29 3. The same individual may simultaneously hold more than 65 30 one office in a corporation. 65 31 Sec. 98. NEW SECTION. 504A.842 DUTIES AND AUTHORITY OF 65 32 OFFICERS. 65 33 Each officer of a corporation has the authority and shall 65 34 perform the duties set forth in the bylaws or, to the extent 65 35 consistent with the bylaws, the duties and authority 66 1 prescribed in a resolution of the board or by direction of an 66 2 officer authorized by the board to prescribe the duties and 66 3 authority of other officers. 66 4 Sec. 99. NEW SECTION. 504A.843 STANDARDS OF CONDUCT FOR 66 5 OFFICERS. 66 6 1. An officer, when performing in such capacity, shall act 66 7 in conformity with all of the following: 66 8 a. In good faith. 66 9 b. With the care that a person in a like position would 66 10 reasonably exercise under similar circumstances. 66 11 c. In a manner the officer reasonably believes to be in 66 12 the best interests of the corporation and its members, if any. 66 13 2. In discharging the officer's duties, an officer who 66 14 does not have knowledge that makes reliance unwarranted, is 66 15 entitled to rely on any of the following: 66 16 a. The performance of properly delegated responsibilities 66 17 by one or more employees of the corporation whom the officer 66 18 reasonably believes to be reliable and competent in performing 66 19 the responsibilities delegated. 66 20 b. Information, opinions, reports, or statements, 66 21 including financial statements and other financial data, 66 22 prepared or presented by one or more officers or employees of 66 23 the corporation whom the officer reasonably believes to be 66 24 reliable and competent in the matters presented. 66 25 c. Legal counsel, public accountants, or other persons 66 26 retained by the corporation as to matters involving the skills 66 27 or expertise the officer reasonably believes are within the 66 28 person's professional or expert competence, or as to which the 66 29 particular person merits confidence. 66 30 d. In the case of religious corporations, religious 66 31 authorities, and ministers, priests, rabbis, or other persons 66 32 whose position or duties in the religious organization the 66 33 officer believes justify reliance and confidence and whom the 66 34 officer believes to be reliable and competent in the matters 66 35 presented. 67 1 3. An officer shall not be liable as an officer to the 67 2 corporation or its members for any decision to take or not to 67 3 take action, or any failure to take any action, if the duties 67 4 of the officer are performed in compliance with this section. 67 5 Whether an officer who does not comply with this section shall 67 6 have liability will depend in such instance on applicable law, 67 7 including those principles of sections 504A.832 and 504A.901 67 8 that have relevance. 67 9 Sec. 100. NEW SECTION. 504A.844 RESIGNATION AND REMOVAL 67 10 OF OFFICERS. 67 11 1. An officer of a corporation may resign at any time by 67 12 delivering notice to the corporation. A resignation is 67 13 effective when the notice is effective unless the notice 67 14 specifies a future effective time. If a resignation is made 67 15 effective at a future time and the board or appointing officer 67 16 accepts the future effective time, its board or appointing 67 17 officer may fill the pending vacancy before the effective time 67 18 if the board or appointing officer provides that the successor 67 19 does not take office until the effective time. 67 20 2. An officer may be removed at any time with or without 67 21 cause by any of the following: 67 22 a. The board of directors. 67 23 b. The officer who appointed such officer, unless the 67 24 bylaws or the board of directors provide otherwise. 67 25 c. Any other officer if authorized by the bylaws or the 67 26 board of directors. 67 27 d. In this section, "appointing officer" means the 67 28 officer, including any successor to that officer, who 67 29 appointed the officer resigning or being removed. 67 30 Sec. 101. NEW SECTION. 504A.845 CONTRACT RIGHTS OF 67 31 OFFICERS. 67 32 1. The appointment of an officer of a corporation does not 67 33 itself create contract rights. 67 34 2. An officer's removal does not affect the officer's 67 35 contract rights, if any, with the corporation. An officer's 68 1 resignation does not affect the corporation's contract rights, 68 2 if any, with the officer. 68 3 Sec. 102. NEW SECTION. 504A.846 OFFICERS' AUTHORITY TO 68 4 EXECUTE DOCUMENTS. 68 5 1. A contract or other instrument in writing executed or 68 6 entered into between a corporation and any other person is not 68 7 invalidated as to the corporation by any lack of authority of 68 8 the signing officers in the absence of actual knowledge on the 68 9 part of the other person that the signing officers had no 68 10 authority to execute the contract or other instrument if it is 68 11 signed by any two officers in category 1 or by one officer in 68 12 category 1 and one officer in category 2 as set out in 68 13 subsection 2. 68 14 2. a. Category 1 officers include the presiding officer 68 15 of the board and the president. 68 16 b. Category 2 officers include a vice president and the 68 17 secretary, treasurer, and executive director. 68 18 PART 5 68 19 INDEMNIFICATION 68 20 Sec. 103. NEW SECTION. 504A.851 DEFINITIONS. 68 21 As used in this part, unless the context otherwise 68 22 requires: 68 23 1. "Corporation" includes any domestic or foreign 68 24 predecessor entity of a corporation in a merger. 68 25 2. "Director" or "officer" means an individual who is or 68 26 was a director or officer of a corporation or an individual 68 27 who, while a director or officer of a corporation, is or was 68 28 serving at the corporation's request as a director, officer, 68 29 partner, trustee, employee, or agent of another foreign or 68 30 domestic business or nonprofit corporation, partnership, joint 68 31 venture, trust, employee benefit plan, or other entity. A 68 32 "director" or "officer" is considered to be serving an 68 33 employee benefit plan at the corporation's request if the 68 34 director's or officer's duties to the corporation also impose 68 35 duties on, or otherwise involve services by, the director or 69 1 officer to the plan or to participants in or beneficiaries of 69 2 the plan. "Director" or "officer" includes, unless the 69 3 context otherwise requires, the estate or personal 69 4 representative of a director or officer. 69 5 3. "Disinterested director" means a director who at the 69 6 time of a vote referred to in section 504A.854, subsection 3, 69 7 or a vote or selection referred to in section 504A.856, 69 8 subsection 2 or 3, is not either of the following: 69 9 a. A party to the proceeding. 69 10 b. An individual having a familial, financial, 69 11 professional, or employment relationship with the director 69 12 whose indemnification or advance for expenses is the subject 69 13 of the decision being made, which relationship would, in the 69 14 circumstances, reasonably be expected to exert an influence on 69 15 the director's judgment when voting on the decision being 69 16 made. 69 17 4. "Expenses" includes attorney fees. 69 18 5. "Liability" means the obligation to pay a judgment, 69 19 settlement, penalty, or fine including an excise tax assessed 69 20 with respect to an employee benefit plan, or reasonable 69 21 expenses actually incurred with respect to a proceeding. 69 22 6. "Official capacity" means either of the following: 69 23 a. When used with respect to a director, the office of 69 24 director in a corporation. 69 25 b. When used with respect to an officer, as contemplated 69 26 in section 504A.857, the office in a corporation held by the 69 27 officer. "Official capacity" does not include service for any 69 28 other foreign or domestic business or nonprofit corporation or 69 29 any partnership joint venture, trust, employee benefit plan, 69 30 or other entity. 69 31 7. "Party" means an individual who was, is, or is 69 32 threatened to be made a defendant or respondent in a 69 33 proceeding. 69 34 8. "Proceeding" means any threatened, pending, or 69 35 completed action, suit, or proceeding whether civil, criminal, 70 1 administrative, or investigative and whether formal or 70 2 informal. 70 3 Sec. 104. NEW SECTION. 504A.852 PERMISSIBLE 70 4 INDEMNIFICATION. 70 5 1. Except as otherwise provided in this section, a 70 6 corporation may indemnify an individual who is a party to a 70 7 proceeding because the individual is a director, against 70 8 liability incurred in the proceeding if all of the following 70 9 apply: 70 10 a. The individual acted in good faith. 70 11 b. The individual reasonably believed either of the 70 12 following: 70 13 (1) In the case of conduct in the individual's official 70 14 capacity, that the individual's conduct was in the best 70 15 interests of the corporation. 70 16 (2) In all other cases, that the individual's conduct was 70 17 at least not opposed to the best interests of the corporation. 70 18 c. In the case of any criminal proceeding, the individual 70 19 had no reasonable cause to believe the individual's conduct 70 20 was unlawful. 70 21 d. The individual engaged in conduct for which broader 70 22 indemnification has been made permissible or obligatory under 70 23 a provision of the articles of incorporation as authorized by 70 24 section 504A.202, subsection 2, paragraph "d". 70 25 2. A director's conduct with respect to an employee 70 26 benefit plan for a purpose the director reasonably believed to 70 27 be in the interests of the participants in and beneficiaries 70 28 of the plan is conduct that satisfies the requirements of 70 29 subsection 1, paragraph "b", subparagraph (2). 70 30 3. The termination of a proceeding by judgment, order, 70 31 settlement, conviction, or upon a plea of nolo contendere or 70 32 its equivalent is not, of itself, determinative that the 70 33 director did not meet the relevant standard of conduct 70 34 described in this section. 70 35 4. Unless ordered by a court under section 504A.855, 71 1 subsection 1, paragraph "b", a corporation shall not indemnify 71 2 a director under this section under either of the following 71 3 circumstances: 71 4 a. In connection with a proceeding by or in the right of 71 5 the corporation, except for reasonable expenses incurred in 71 6 the relevant standard of conduct under subsection 1. 71 7 b. In connection with any proceeding with respect to 71 8 conduct for which the director was adjudged liable on the 71 9 basis that the director received a financial benefit to which 71 10 the director was not entitled, whether or not involving action 71 11 in the director's official capacity. 71 12 Sec. 105. NEW SECTION. 504A.853 MANDATORY 71 13 INDEMNIFICATION. 71 14 A corporation shall indemnify a director who was wholly 71 15 successful, on the merits or otherwise, in the defense of any 71 16 proceeding to which the director was a party because the 71 17 director is or was a director of the corporation against 71 18 reasonable expenses actually incurred by the director in 71 19 connection with the proceeding. 71 20 Sec. 106. NEW SECTION. 504A.854 ADVANCE FOR EXPENSES. 71 21 1. A corporation may, before final disposition of a 71 22 proceeding, advance funds to pay for or reimburse the 71 23 reasonable expenses incurred by a director who is a party to a 71 24 proceeding because the person is a director if the person 71 25 delivers all of the following to the corporation: 71 26 a. A written affirmation of the director's good faith 71 27 belief that the director has met the relevant standard of 71 28 conduct described in section 504A.852 or that the proceeding 71 29 involved conduct for which liability has been eliminated under 71 30 a provision of the articles of incorporation as authorized by 71 31 section 504A.202, subsection 2, paragraph "d". 71 32 b. The director's written undertaking to repay any funds 71 33 advanced if the director is not entitled to mandatory 71 34 indemnification under section 504A.853 and it is ultimately 71 35 determined under section 504A.855 or 504A.856 that the 72 1 director has not met the relevant standard of conduct 72 2 described in section 504A.852. 72 3 2. The undertaking required by subsection 1, paragraph 72 4 "b", must be an unlimited general obligation of the director 72 5 but need not be secured and may be accepted without reference 72 6 to the financial ability of the director to make repayment. 72 7 3. Authorizations under this section shall be made 72 8 according to one of the following: 72 9 a. By the board of directors as follows: 72 10 (1) If there are two or more disinterested directors, by a 72 11 majority vote of all the disinterested directors, a majority 72 12 of whom shall for such purpose constitute a quorum, or by a 72 13 majority of the members of a committee of two or more 72 14 disinterested directors appointed by such vote. 72 15 (2) If there are fewer than two disinterested directors, 72 16 by the vote necessary for action by the board in accordance 72 17 with section 504A.825, subsection 2, in which authorization 72 18 directors who do not qualify as disinterested directors may 72 19 participate. 72 20 b. By the members, but the director who, at the time does 72 21 not qualify as a disinterested director, may not vote as a 72 22 member or on behalf of a member. 72 23 Sec. 107. NEW SECTION. 504A.855 COURT-ORDERED 72 24 INDEMNIFICATION. 72 25 1. A director who is a party to a proceeding because the 72 26 person is a director may apply for indemnification or an 72 27 advance for expenses to the court conducting the proceeding or 72 28 to another court of competent jurisdiction. After receipt of 72 29 an application, and after giving any notice the court 72 30 considers necessary, the court shall do one of the following: 72 31 a. Order indemnification if the court determines that the 72 32 director is entitled to mandatory indemnification under 72 33 section 504A.853. 72 34 b. Order indemnification or advance for expenses if the 72 35 court determines that the director is entitled to 73 1 indemnification or advance for expenses pursuant to a 73 2 provision authorized by section 504A.859, subsection 1. 73 3 c. Order indemnification or advance for expenses if the 73 4 court determines, in view of all the relevant circumstances, 73 5 that it is fair and reasonable to do one of the following: 73 6 (1) To indemnify the director. 73 7 (2) To indemnify or advance expenses to the director, even 73 8 if the director has not met the relevant standard of conduct 73 9 set forth in section 504A.852, subsection 1, failed to comply 73 10 with section 504A.854 or was adjudged liable in a proceeding 73 11 referred to in section 504A.852, subsection 4, paragraph "a" 73 12 or "b", but if the director was adjudged so liable the 73 13 director's indemnification shall be limited to reasonable 73 14 expenses incurred in connection with the proceeding. 73 15 2. If the court determines that the director is entitled 73 16 to indemnification under subsection 1, paragraph "a", or to 73 17 indemnification or advance for expenses under subsection 1, 73 18 paragraph "b", it shall also order the corporation to pay the 73 19 director's reasonable expenses incurred in connection with 73 20 obtaining court-ordered indemnification or advance for 73 21 expenses. If the court determines that the director is 73 22 entitled to indemnification or advance for expenses under 73 23 subsection 1, paragraph "c", it may also order the corporation 73 24 to pay the director's reasonable expenses to obtain court- 73 25 ordered indemnification or advance for expenses. 73 26 Sec. 108. NEW SECTION. 504A.856 DETERMINATION AND 73 27 AUTHORIZATION OF INDEMNIFICATION. 73 28 1. A corporation shall not indemnify a director under 73 29 section 504A.852 unless authorized for a specific proceeding 73 30 after a determination has been made that indemnification of 73 31 the director is permissible because the director has met the 73 32 standard of conduct set forth in section 504A.852. 73 33 2. The determination shall be made by any of the 73 34 following: 73 35 a. If there are two or more disinterested directors, by 74 1 the board of directors by a majority vote of all the 74 2 disinterested directors, a majority of whom shall for such 74 3 purpose constitute a quorum, or by a majority of the members 74 4 of a committee of two or more disinterested directors 74 5 appointed by such vote. 74 6 b. By special legal counsel under one of the following 74 7 circumstances: 74 8 (1) Selected in the manner prescribed in paragraph "a". 74 9 (2) If there are fewer than two disinterested directors 74 10 selected by the board in which selection directors who do not 74 11 qualify as disinterested directors may participate. 74 12 c. By the members of a mutual benefit corporation, but 74 13 directors who are at the time parties to the proceeding shall 74 14 not vote on the determination. 74 15 3. Authorization of indemnification shall be made in the 74 16 same manner as the determination that indemnification is 74 17 permissible, except that if there are fewer than two 74 18 disinterested directors or if the determination is made by 74 19 special legal counsel, authorization of indemnification shall 74 20 be made by those entitled under subsection 2, paragraph "c", 74 21 to select special legal counsel. 74 22 4. A director of a public benefit corporation shall not be 74 23 indemnified until twenty days after the effective date of 74 24 written notice to the attorney general of the proposed 74 25 indemnification. 74 26 Sec. 109. NEW SECTION. 504A.857 INDEMNIFICATION OF 74 27 OFFICERS. 74 28 1. A corporation may indemnify and advance expenses under 74 29 this part to an officer of the corporation who is a party to a 74 30 proceeding because the person is an officer, according to all 74 31 of the following: 74 32 a. To the same extent as to a director. 74 33 b. If the person is an officer but not a director, to such 74 34 further extent as may be provided by the articles of 74 35 incorporation, the bylaws, a resolution of the board of 75 1 directors, or contract, except for either of the following: 75 2 (1) Liability in connection with a proceeding by or in the 75 3 right of the corporation other than for reasonable expenses 75 4 incurred in connection with the proceeding. 75 5 (2) Liability arising out of conduct that constitutes any 75 6 of the following: 75 7 (a) Receipt by the officer of a financial benefit to which 75 8 the officer is not entitled. 75 9 (b) An intentional infliction of harm on the corporation 75 10 or the shareholders. 75 11 (c) An intentional violation of criminal law. 75 12 2. The provisions of subsection 1, paragraph "b", shall 75 13 apply to an officer who is also a director if the basis on 75 14 which the officer is made a party to a proceeding is an act or 75 15 omission solely as an officer. 75 16 3. An officer of a corporation who is not a director is 75 17 entitled to mandatory indemnification under section 504A.853, 75 18 and may apply to a court under section 504A.855 for 75 19 indemnification or an advance for expenses, in each case to 75 20 the same extent to which a director may be entitled to 75 21 indemnification or advance for expenses under those 75 22 provisions. 75 23 Sec. 110. NEW SECTION. 504A.858 INSURANCE. 75 24 A corporation may purchase and maintain insurance on behalf 75 25 of an individual who is a director or officer of the 75 26 corporation, or who, while a director or officer of the 75 27 corporation, serves at the request of the corporation as a 75 28 director, officer, partner, trustee, employee, or agent of 75 29 another domestic business or nonprofit corporation, 75 30 partnership, joint venture, trust, employee benefit plan, or 75 31 other entity, against liability asserted against or incurred 75 32 by the individual in that capacity or arising from the 75 33 individual's status as a director, officer, whether or not the 75 34 corporation would have power to indemnify or advance expenses 75 35 to that individual against the same liability under this part. 76 1 Sec. 111. NEW SECTION. 504A.859 APPLICATION OF PART. 76 2 1. A corporation may, by a provision in its articles of 76 3 incorporation or bylaws or in a resolution adopted or a 76 4 contract approved by its board of directors or members, 76 5 obligate itself in advance of the act or omission giving rise 76 6 to a proceeding to provide indemnification in accordance with 76 7 section 504A.852 or advance funds to pay for or reimburse 76 8 expenses in accordance with section 504A.854. Any such 76 9 obligatory provision shall be deemed to satisfy the 76 10 requirements for authorization referred to in section 76 11 504A.854, subsection 3, and in section 504A.856, subsection 2 76 12 or 3. Any such provision that obligates the corporation to 76 13 provide indemnification to the fullest extent permitted by law 76 14 shall be deemed to obligate the corporation to advance funds 76 15 to pay for or reimburse expenses in accordance with section 76 16 504A.854 to the fullest extent permitted by law, unless the 76 17 provision specifically provides otherwise. 76 18 2. Any provision pursuant to subsection 1 shall not 76 19 obligate the corporation to indemnify or advance expenses to a 76 20 director of a predecessor of the corporation, pertaining to 76 21 conduct with respect to the predecessor, unless otherwise 76 22 specifically provided. Any provision for indemnification or 76 23 advance for expenses in the articles of incorporation, bylaws, 76 24 or a resolution of the board of directors or members of a 76 25 predecessor of the corporation in a merger or in a contract to 76 26 which the predecessor is a party, existing at the time the 76 27 merger takes effect, shall be governed by section 504A.1104. 76 28 3. A corporation may, by a provision in its articles of 76 29 incorporation, limit any of the rights to indemnification or 76 30 advance for expenses created by or pursuant to this part. 76 31 4. This part does not limit a corporation's power to pay 76 32 or reimburse expenses incurred by a director or an officer in 76 33 connection with the director's or officer's appearance as a 76 34 witness in a proceeding at a time when the director or officer 76 35 is not a party. 77 1 5. This part does not limit a corporation's power to 77 2 indemnify, advance expenses to, or provide or maintain 77 3 insurance on behalf of an employee or agent. 77 4 Sec. 112. NEW SECTION. 504A.860 EXCLUSIVITY OF PART. 77 5 A corporation may provide indemnification or advance 77 6 expenses to a director or an officer only as permitted by this 77 7 part. 77 8 SUBCHAPTER IX 77 9 PERSONAL LIABILITY 77 10 Sec. 113. NEW SECTION. 504A.901 PERSONAL LIABILITY. 77 11 Except as otherwise provided in this chapter, a director, 77 12 officer, employee, or member of a corporation is not liable 77 13 for the corporation's debts or obligations and a director, 77 14 officer, member, or other volunteer is not personally liable 77 15 in that capacity, to any person for any action taken or 77 16 failure to take any action in the discharge of the person's 77 17 duties except liability for any of the following: 77 18 1. The amount of any financial benefit to which the person 77 19 is not entitled. 77 20 2. An intentional infliction of harm on the corporation or 77 21 the members. 77 22 3. A violation of section 504A.834. 77 23 4. An intentional violation of criminal law. 77 24 SUBCHAPTER X 77 25 AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS 77 26 PART 1 77 27 ARTICLES OF INCORPORATION 77 28 Sec. 114. NEW SECTION. 504A.1001 AUTHORITY TO AMEND. 77 29 A corporation may amend its articles of incorporation at 77 30 any time to add or change a provision that is required or 77 31 permitted in the articles or to delete a provision not 77 32 required in the articles. Whether a provision is required or 77 33 permitted in the articles is determined as of the effective 77 34 date of the amendment. 77 35 Sec. 115. NEW SECTION. 504A.1002 AMENDMENT BY DIRECTORS. 78 1 1. Unless the articles provide otherwise, a corporation's 78 2 board of directors may adopt one or more amendments to the 78 3 corporation's articles without member approval to do any of 78 4 the following: 78 5 a. Extend the duration of the corporation if it was 78 6 incorporated at a time when limited duration was required by 78 7 law. 78 8 b. Delete the names and addresses of the initial 78 9 directors. 78 10 c. Delete the name and address of the initial registered 78 11 agent or registered office, if a statement of change is on 78 12 file with the secretary of state. 78 13 d. Change the corporate name by substituting the word 78 14 "corporation", "incorporated", "company", "limited", or the 78 15 abbreviation "corp.", "inc.", "co.", or "ltd.", for a similar 78 16 word or abbreviation in the name, or by adding, deleting, or 78 17 changing a geographical attribution to the name. 78 18 e. Make any other change expressly permitted by this 78 19 subchapter to be made by director action. 78 20 2. If a corporation has no members, its incorporators, 78 21 until directors have been chosen, and thereafter its board of 78 22 directors, may adopt one or more amendments to the 78 23 corporation's articles subject to any approval required 78 24 pursuant to section 504A.1031. The corporation shall provide 78 25 notice of any meeting at which an amendment is to be voted 78 26 upon. The notice shall be in accordance with section 78 27 504A.823, subsection 3. The notice must also state that the 78 28 purpose, or one of the purposes, of the meeting is to consider 78 29 a proposed amendment to the articles and contain or be 78 30 accompanied by a copy or summary of the amendment or state the 78 31 general nature of the amendment. The amendment must be 78 32 approved by a majority of the directors in office at the time 78 33 the amendment is adopted. 78 34 Sec. 116. NEW SECTION. 504A.1003 AMENDMENT BY DIRECTORS 78 35 AND MEMBERS. 79 1 1. Unless this chapter, the articles or bylaws of a 79 2 corporation, the members acting pursuant to subsection 2, or 79 3 the board of directors acting pursuant to subsection 3, 79 4 require a greater vote or voting by class, an amendment to the 79 5 corporation's articles must be approved by all of the 79 6 following to be adopted: 79 7 a. The board if the corporation is a public benefit or 79 8 religious corporation and the amendment does not relate to the 79 9 number of directors, the composition of the board, the term of 79 10 office of directors, or the method or way in which directors 79 11 are elected or selected. 79 12 b. Except as provided in section 504A.1002, subsection 1, 79 13 by the members by two-thirds of the votes cast by the members 79 14 or a majority of the members' voting power that could be cast, 79 15 whichever is less. 79 16 c. In writing by any person or persons whose approval is 79 17 required by a provision of the articles authorized by section 79 18 504A.1031. 79 19 2. The members may condition the adoption of an amendment 79 20 on receipt of a higher percentage of affirmative votes or on 79 21 any other basis. 79 22 3. If the board initiates an amendment to the articles or 79 23 board approval is required by subsection 1 to adopt an 79 24 amendment to the articles, the board may condition the 79 25 amendment's adoption on receipt of a higher percentage of 79 26 affirmative votes or any other basis. 79 27 4. If the board or the members seek to have the amendment 79 28 approved by the members at a membership meeting, the 79 29 corporation shall give notice to its members of the proposed 79 30 membership meeting in writing in accordance with section 79 31 504A.705. The notice must state that the purpose, or one of 79 32 the purposes, of the meeting is to consider the proposed 79 33 amendment and contain or be accompanied by a copy or summary 79 34 of the amendment. 79 35 5. If the board or the members seek to have the amendment 80 1 approved by the members by written consent or written ballot, 80 2 the material soliciting the approval shall contain or be 80 3 accompanied by a copy or summary of the amendment. 80 4 Sec. 117. NEW SECTION. 504A.1004 CLASS VOTING BY MEMBERS 80 5 ON AMENDMENTS. 80 6 1. The members of a class in a public benefit corporation 80 7 are entitled to vote as a class on a proposed amendment to the 80 8 articles if the amendment would change the rights of that 80 9 class as to voting in a manner different than such amendment 80 10 affects another class or members of another class. 80 11 2. The members of a class in a mutual benefit corporation 80 12 are entitled to vote as a class on a proposed amendment to the 80 13 articles if the amendment would do any of the following: 80 14 a. Affect the rights, privileges, preferences, 80 15 restrictions, or conditions of that class as to voting, 80 16 dissolution, redemption, or transfer of memberships in a 80 17 manner different than such amendment would affect another 80 18 class. 80 19 b. Change the rights, privileges, preferences, 80 20 restrictions, or conditions of that class as to voting, 80 21 dissolution, redemption, or transfer by changing the rights, 80 22 privileges, preferences, restrictions, or conditions of 80 23 another class. 80 24 c. Increase or decrease the number of memberships 80 25 authorized for that class. 80 26 d. Increase the number of memberships authorized for 80 27 another class. 80 28 e. Effect an exchange, reclassification, or termination of 80 29 the memberships of that class. 80 30 f. Authorize a new class of memberships. 80 31 3. The members of a class of a religious corporation are 80 32 entitled to vote as a class on a proposed amendment to the 80 33 articles only if a class vote is provided for in the articles 80 34 or bylaws. 80 35 4. If a class is to be divided into two or more classes as 81 1 a result of an amendment to the articles of a public benefit 81 2 or mutual benefit corporation, the amendment must be approved 81 3 by the members of each class that would be created by the 81 4 amendment. 81 5 5. Except as provided in the articles or bylaws of a 81 6 religious corporation, if a class vote is required to approve 81 7 an amendment to the articles of the corporation, the amendment 81 8 must be approved by the members of the class by two-thirds of 81 9 the votes cast by the class or a majority of the voting power 81 10 of the class, whichever is less. 81 11 6. A class of members of a public benefit or mutual 81 12 benefit corporation is entitled to the voting rights granted 81 13 by this section even if the public benefit or mutual benefit 81 14 corporation's articles and bylaws provide that the class shall 81 15 not vote on the proposed amendment. 81 16 Sec. 118. NEW SECTION. 504A.1005 ARTICLES OF AMENDMENT. 81 17 A corporation amending its articles shall deliver to the 81 18 secretary of state articles of amendment setting forth: 81 19 1. The name of the corporation. 81 20 2. The text of each amendment adopted. 81 21 3. The date of each amendment's adoption. 81 22 4. If approval by members was not required, a statement to 81 23 that effect and a statement that the amendment was approved by 81 24 a sufficient vote of the board of directors or incorporators. 81 25 5. If approval by members was required, both of the 81 26 following: 81 27 a. The designation, number of memberships outstanding, 81 28 number of votes entitled to be cast by each class entitled to 81 29 vote separately on the amendment, and number of votes of each 81 30 class indisputably voting on the amendment. 81 31 b. Either the total number of votes cast for and against 81 32 the amendment by each class entitled to vote separately on the 81 33 amendment or the total number of undisputed votes cast for the 81 34 amendment by each class and a statement that the number of 81 35 votes cast for the amendment by each class was sufficient for 82 1 approval by that class. 82 2 6. If approval of the amendment by some person or persons 82 3 other than the members, the board, or the incorporators is 82 4 required pursuant to section 504A.1031, a statement that the 82 5 approval was obtained. 82 6 Sec. 119. NEW SECTION. 504A.1006 RESTATED ARTICLES OF 82 7 INCORPORATION. 82 8 1. A corporation's board of directors may restate the 82 9 corporation's articles of incorporation at any time with or 82 10 without approval by members or any other person. 82 11 2. The restatement may include one or more amendments to 82 12 the articles. If the restatement includes an amendment 82 13 requiring approval by the members or any other person, it must 82 14 be adopted as provided in section 504A.1003. 82 15 3. If the restatement includes an amendment requiring 82 16 approval by members, the board must submit the restatement to 82 17 the members for their approval. 82 18 4. If the board seeks to have the restatement approved by 82 19 the members at a membership meeting, the corporation shall 82 20 notify each of its members of the proposed membership meeting 82 21 in writing in accordance with section 504A.705. The notice 82 22 must also state that the purpose, or one of the purposes, of 82 23 the meeting is to consider the proposed restatement and must 82 24 contain or be accompanied by a copy or summary of the 82 25 restatement that identifies any amendments or other changes 82 26 the restatement would make in the articles. 82 27 5. If the board seeks to have the restatement approved by 82 28 the members by written ballot or written consent, the material 82 29 soliciting the approval shall contain or be accompanied by a 82 30 copy or summary of the restatement that identifies any 82 31 amendments or other changes the restatement would make in the 82 32 articles. 82 33 6. A restatement requiring approval by the members must be 82 34 approved by the same vote as an amendment to articles under 82 35 section 504A.1003. 83 1 7. If the restatement includes an amendment requiring 83 2 approval pursuant to section 504A.1031, the board must submit 83 3 the restatement for such approval. 83 4 8. A corporation restating its articles shall deliver to 83 5 the secretary of state articles of restatement setting forth 83 6 the name of the corporation and the text of the restated 83 7 articles of incorporation together with a certificate setting 83 8 forth all of the following: 83 9 a. Whether the restatement contains an amendment to the 83 10 articles requiring approval by the members or any other person 83 11 other than the board of directors and, if it does not, that 83 12 the board of directors adopted the restatement. 83 13 b. If the restatement contains an amendment to the 83 14 articles requiring approval by the members, the information 83 15 required by section 504A.1005. 83 16 c. If the restatement contains an amendment to the 83 17 articles requiring approval by a person whose approval is 83 18 required pursuant to section 504A.1031, a statement that such 83 19 approval was obtained. 83 20 9. Duly adopted restated articles of incorporation 83 21 supersede the original articles of incorporation and all 83 22 amendments to the original articles. 83 23 10. The secretary of state may certify restated articles 83 24 of incorporation as the articles of incorporation currently in 83 25 effect without including the certificate information required 83 26 by subsection 8. 83 27 Sec. 120. NEW SECTION. 504A.1007 AMENDMENT PURSUANT TO 83 28 JUDICIAL REORGANIZATION. 83 29 1. A corporation's articles may be amended without board 83 30 approval or approval by the members or approval required 83 31 pursuant to section 504A.1031 to carry out a plan of 83 32 reorganization ordered or decreed by a court of competent 83 33 jurisdiction under federal statute if the articles after 83 34 amendment contain only provisions required or permitted by 83 35 section 504A.202. 84 1 2. An individual or individuals designated by the court 84 2 shall deliver to the secretary of state articles of amendment 84 3 setting forth all of the following: 84 4 a. The name of the corporation. 84 5 b. The text of each amendment approved by the court. 84 6 c. The date of the court's order or decree approving the 84 7 articles of amendment. 84 8 d. The title of the reorganization proceeding in which the 84 9 order or decree was entered. 84 10 e. A statement that the court had jurisdiction of the 84 11 proceeding under federal statute. 84 12 3. This section does not apply after entry of a final 84 13 decree in the reorganization proceeding even though the court 84 14 retains jurisdiction of the proceeding for limited purposes 84 15 unrelated to consummation of the reorganization plan. 84 16 Sec. 121. NEW SECTION. 504A.1008 EFFECT OF AMENDMENT AND 84 17 RESTATEMENT. 84 18 An amendment to articles of incorporation does not affect a 84 19 cause of action existing against or in favor of the 84 20 corporation, a proceeding to which the corporation is a party, 84 21 any requirement or limitation imposed upon the corporation or 84 22 any property held by it by virtue of any trust upon which such 84 23 property is held by the corporation or the existing rights of 84 24 persons other than members of the corporation. An amendment 84 25 changing a corporation's name does not abate a proceeding 84 26 brought by or against the corporation in its former name. 84 27 PART 2 84 28 BYLAWS 84 29 Sec. 122. NEW SECTION. 504A.1021 AMENDMENT BY DIRECTORS. 84 30 If a corporation has no members, its incorporators, until 84 31 directors have been chosen, and thereafter its board of 84 32 directors, may adopt one or more amendments to the 84 33 corporation's bylaws subject to any approval required pursuant 84 34 to section 504A.1031. The corporation shall provide notice of 84 35 any meeting of directors at which an amendment is to be 85 1 approved. The notice must be given in accordance with section 85 2 504A.823, subsection 3. The notice must also state that the 85 3 purpose, or one of the purposes, of the meeting is to consider 85 4 a proposed amendment to the bylaws and contain or be 85 5 accompanied by a copy or summary of the amendment or state the 85 6 general nature of the amendment. The amendment must be 85 7 approved by a majority of the directors in office at the time 85 8 the amendment is adopted. 85 9 Sec. 123. NEW SECTION. 504A.1022 AMENDMENT BY DIRECTORS 85 10 AND MEMBERS. 85 11 1. Unless this chapter, the articles, bylaws, the members 85 12 acting pursuant to subsection 2, or the board of directors 85 13 acting pursuant to subsection 3, require a greater vote or 85 14 voting by class, or the articles or bylaws provide otherwise, 85 15 an amendment to a corporation's bylaws must be approved by all 85 16 of the following to be adopted: 85 17 a. By the board if the corporation is a public benefit or 85 18 religious corporation and the amendment does not relate to the 85 19 number of directors, the composition of the board, the term of 85 20 office of directors, or the method or way in which directors 85 21 are elected or selected. 85 22 b. By the members by two-thirds of the votes cast or a 85 23 majority of the voting power, whichever is less. 85 24 c. In writing by any person or persons whose approval is 85 25 required by a provision of the articles authorized by section 85 26 504A.1031. 85 27 2. The members may condition the amendment's adoption on 85 28 its receipt of a higher percentage of affirmative votes or on 85 29 any other basis. 85 30 3. If the board initiates an amendment to the bylaws or 85 31 board approval is required by subsection 1 to adopt an 85 32 amendment to the bylaws, the board may condition the 85 33 amendment's adoption on receipt of a higher percentage of 85 34 affirmative votes or on any other basis. 85 35 4. If the board or the members seek to have the amendment 86 1 approved by the members at a membership meeting, the 86 2 corporation shall give notice to its members of the proposed 86 3 membership meeting in writing in accordance with section 86 4 504A.705. The notice must also state that the purpose, or one 86 5 of the purposes, of the meeting is to consider the proposed 86 6 amendment and contain or be accompanied by a copy or summary 86 7 of the amendment. 86 8 5. If the board or the members seek to have the amendment 86 9 approved by the members by written consent or written ballot, 86 10 the material soliciting the approval shall contain or be 86 11 accompanied by a copy or summary of the amendment. 86 12 Sec. 124. NEW SECTION. 504A.1023 CLASS VOTING BY MEMBERS 86 13 ON AMENDMENTS. 86 14 1. The members of a class in a public benefit corporation 86 15 are entitled to vote as a class on a proposed amendment to the 86 16 bylaws if the amendment would change the rights of that class 86 17 as to voting in a manner different than such amendment affects 86 18 another class or members of another class. 86 19 2. The members of a class in a mutual benefit corporation 86 20 are entitled to vote as a class on a proposed amendment to the 86 21 bylaws if the amendment would do any of the following: 86 22 a. Affect the rights, privileges, preferences, 86 23 restrictions, or conditions of that class as to voting, 86 24 dissolution, redemption, or transfer of memberships in a 86 25 manner different than such amendment would affect another 86 26 class. 86 27 b. Change the rights, privileges, preferences, 86 28 restrictions, or conditions of that class as to voting, 86 29 dissolution, redemption, or transfer by changing the rights, 86 30 privileges, preferences, restrictions, or conditions of 86 31 another class. 86 32 c. Increase or decrease the number of memberships 86 33 authorized for that class. 86 34 d. Increase the number of memberships authorized for 86 35 another class. 87 1 e. Effect an exchange, reclassification, or termination of 87 2 all or part of the memberships of that class. 87 3 f. Authorize a new class of memberships. 87 4 3. The members of a class of a religious corporation are 87 5 entitled to vote as a class on a proposed amendment to the 87 6 bylaws only if a class vote is provided for in the articles or 87 7 bylaws. 87 8 4. If a class is to be divided into two or more classes as 87 9 a result of an amendment to the bylaws, the amendment must be 87 10 approved by the members of each class that would be created by 87 11 the amendment. 87 12 5. If a class vote is required to approve an amendment to 87 13 the bylaws, the amendment must be approved by the members of 87 14 the class by two-thirds of the votes cast by the class or a 87 15 majority of the voting power of the class, whichever is less. 87 16 6. A class of members is entitled to the voting rights 87 17 granted by this section even if the articles and bylaws 87 18 provide that the class may not vote on the proposed amendment. 87 19 PART 3 87 20 ARTICLES OF INCORPORATION AND BYLAWS 87 21 Sec. 125. NEW SECTION. 504A.1031 APPROVAL BY THIRD 87 22 PERSONS. 87 23 The articles of a corporation may require that an amendment 87 24 to the articles or bylaws be approved in writing by a 87 25 specified person or persons other than the board. Such a 87 26 provision in the articles may only be amended with the 87 27 approval in writing of the person or persons specified in the 87 28 provision. 87 29 Sec. 126. NEW SECTION. 504A.1032 AMENDMENT TERMINATING 87 30 MEMBERS OR REDEEMING OR CANCELING MEMBERSHIPS. 87 31 1. An amendment to the articles or bylaws of a public 87 32 benefit or mutual benefit corporation which would terminate 87 33 all members or any class of members or redeem or cancel all 87 34 memberships or any class of memberships must meet the 87 35 requirements of this chapter and this section. 88 1 2. Before adopting a resolution proposing such an 88 2 amendment, the board of a mutual benefit corporation shall 88 3 give notice of the general nature of the amendment to the 88 4 members. 88 5 3. After adopting a resolution proposing such an 88 6 amendment, the notice to members proposing such amendment 88 7 shall include one statement of up to five hundred words 88 8 opposing the proposed amendment, if such statement is 88 9 submitted by any five members or members having three percent 88 10 or more of the voting power, whichever is less, not later than 88 11 twenty days after the board has voted to submit such amendment 88 12 to the members for their approval. In public benefit 88 13 corporations, the production and mailing costs of the 88 14 statement opposing the proposed amendment shall be paid by the 88 15 requesting members. In mutual benefit corporations, the 88 16 production and mailing costs of the statement opposing the 88 17 proposed amendment shall be paid by the corporation. 88 18 4. Any such amendment shall be approved by the members by 88 19 two-thirds of the votes cast by each class. 88 20 5. The provisions of section 504A.622 shall not apply to 88 21 any amendment meeting the requirements of this chapter and 88 22 this section. 88 23 SUBCHAPTER XI 88 24 MERGER 88 25 Sec. 127. NEW SECTION. 504A.1101 APPROVAL OF PLAN OF 88 26 MERGER. 88 27 1. Subject to the limitations set forth in section 88 28 504A.1102, one or more nonprofit corporations may merge with 88 29 or into any one or more corporations or nonprofit corporations 88 30 or limited liability companies, if the plan of merger is 88 31 approved as provided in section 504A.1103. 88 32 2. The plan of merger shall set forth all of the 88 33 following: 88 34 a. The name of each corporation or limited liability 88 35 company planning to merge and the name of the surviving 89 1 corporation into which each plans to merge. 89 2 b. The terms and conditions of the planned merger. 89 3 c. The manner and basis, if any, of converting the 89 4 memberships of each public benefit or religious corporation 89 5 into memberships of the surviving corporation or limited 89 6 liability company. 89 7 d. If the merger involves a mutual benefit corporation, 89 8 the manner and basis, if any, of converting memberships of 89 9 each merging corporation into memberships, obligations, or 89 10 securities of the surviving or any other corporation or 89 11 limited liability company or into cash or other property in 89 12 whole or in part. 89 13 3. The plan of merger may set forth any of the following: 89 14 a. Any amendments to the articles of incorporation or 89 15 bylaws of the surviving corporation or limited liability 89 16 company to be effected by the planned merger. 89 17 b. Other provisions relating to the planned merger. 89 18 Sec. 128. NEW SECTION. 504A.1102 LIMITATIONS ON MERGERS 89 19 BY PUBLIC BENEFIT OR RELIGIOUS CORPORATIONS. 89 20 1. Without the prior approval of the district court in a 89 21 proceeding of which the attorney general has been given 89 22 written notice, a public benefit or religious corporation may 89 23 merge only with one of the following: 89 24 a. A public benefit or religious corporation. 89 25 b. A foreign corporation which would qualify under this 89 26 chapter as a public benefit or religious corporation. 89 27 c. A wholly owned foreign or domestic business or mutual 89 28 benefit corporation, provided the public benefit or religious 89 29 corporation is the surviving corporation and continues to be a 89 30 public benefit or religious corporation after the merger. 89 31 d. A business or mutual benefit corporation, provided that 89 32 all of the following apply: 89 33 (1) On or prior to the effective date of the merger, 89 34 assets with a value equal to the greater of the fair market 89 35 value of the net tangible and intangible assets, including 90 1 goodwill, of the public benefit or religious corporation or 90 2 the fair market value of the public benefit or religious 90 3 corporation if it were to be operated as a business concern 90 4 are transferred or conveyed to one or more persons who would 90 5 have received its assets under section 504A.1406, subsection 90 6 1, paragraphs "e" and "f", had it dissolved. 90 7 (2) The business or mutual benefit corporation shall 90 8 return, transfer, or convey any assets held by it upon 90 9 condition requiring return, transfer, or conveyance, which 90 10 condition occurs by reason of the merger, in accordance with 90 11 such condition. 90 12 (3) The merger is approved by a majority of directors of 90 13 the public benefit or religious corporation who are not and 90 14 will not become members or shareholders in or officers, 90 15 employees, agents, or consultants of the surviving 90 16 corporation. 90 17 2. At least twenty days before consummation of any merger 90 18 of a public benefit corporation or a religious corporation 90 19 pursuant to subsection 1, paragraph "d", notice, including a 90 20 copy of the proposed plan of merger, must be delivered to the 90 21 attorney general. 90 22 3. Without the prior written consent of the attorney 90 23 general or of the district court in a proceeding in which the 90 24 attorney general has been given notice, a member of a public 90 25 benefit or religious corporation shall not receive or keep 90 26 anything as a result of a merger other than a membership in 90 27 the surviving public benefit or religious corporation. The 90 28 court shall approve the transaction if it is in the public 90 29 interest. 90 30 Sec. 129. NEW SECTION. 504A.1103 ACTION ON PLAN BY 90 31 BOARD, MEMBERS, AND THIRD PERSONS. 90 32 1. Unless this chapter, the articles, bylaws, or the board 90 33 of directors or members acting pursuant to subsection 3 90 34 require a greater vote or voting by class, a plan of merger 90 35 for a corporation must be approved by all of the following to 91 1 be adopted: 91 2 a. The board. 91 3 b. The members, if any, by two-thirds of the votes cast or 91 4 a majority of the voting power, whichever is less. 91 5 c. In writing by any person or persons whose approval is 91 6 required by a provision of the articles authorized by section 91 7 504A.1031 for an amendment to the articles or bylaws. 91 8 2. If the corporation does not have members, the merger 91 9 must be approved by a majority of the directors in office at 91 10 the time the merger is approved. In addition, the corporation 91 11 shall provide notice of any directors' meeting at which such 91 12 approval is to be obtained in accordance with section 91 13 504A.823, subsection 3. The notice must also state that the 91 14 purpose, or one of the purposes, of the meeting is to consider 91 15 the proposed merger. 91 16 3. The board may condition its submission of the proposed 91 17 merger, and the members may condition their approval of the 91 18 merger, on receipt of a higher percentage of affirmative votes 91 19 or on any other basis. 91 20 4. If the board seeks to have the plan approved by the 91 21 members at a membership meeting, the corporation shall give 91 22 notice to its members of the proposed membership meeting in 91 23 accordance with section 504A.705. The notice must also state 91 24 that the purpose, or one of the purposes, of the meeting is to 91 25 consider the plan of merger and contain or be accompanied by a 91 26 copy or summary of the plan. The copy or summary of the plan 91 27 for members of the surviving corporation shall include any 91 28 provision that, if contained in a proposed amendment to the 91 29 articles of incorporation or bylaws, would entitle members to 91 30 vote on the provision. The copy or summary of the plan for 91 31 members of the disappearing corporation shall include a copy 91 32 or summary of the articles and bylaws which will be in effect 91 33 immediately after the merger takes effect. 91 34 5. If the board seeks to have the plan approved by the 91 35 members by written consent or written ballot, the material 92 1 soliciting the approval shall contain or be accompanied by a 92 2 copy or summary of the plan. The copy or summary of the plan 92 3 for members of the surviving corporation shall include any 92 4 provision that, if contained in a proposed amendment to the 92 5 articles of incorporation or bylaws, would entitle members to 92 6 vote on the provision. The copy or summary of the plan for 92 7 members of the disappearing corporation shall include a copy 92 8 or summary of the articles and bylaws which will be in effect 92 9 immediately after the merger takes effect. 92 10 6. Voting by a class of members is required on a plan of 92 11 merger if the plan contains a provision that, if contained in 92 12 a proposed amendment to articles of incorporation or bylaws, 92 13 would entitle the class of members to vote as a class on the 92 14 proposed amendment under section 504A.1004 or 504A.1023. The 92 15 plan must be approved by a class of members by two-thirds of 92 16 the votes cast by the class or a majority of the voting power 92 17 of the class, whichever is less. 92 18 7. After a merger is adopted, and at any time before 92 19 articles of merger are filed, the planned merger may be 92 20 abandoned subject to any contractual rights without further 92 21 action by members or other persons who approved the plan in 92 22 accordance with the procedure set forth in the plan of merger 92 23 or, if none is set forth, in the manner determined by the 92 24 board of directors. 92 25 Sec. 130. NEW SECTION. 504A.1104 ARTICLES OF MERGER. 92 26 After a plan of merger is approved by the board of 92 27 directors, and if required by section 504A.1103, by the 92 28 members and any other persons, the surviving or acquiring 92 29 corporation shall deliver to the secretary of state articles 92 30 of merger setting forth all of the following, as applicable: 92 31 1. The plan of merger. 92 32 2. If approval of members was not required, a statement to 92 33 that effect and a statement that the plan was approved by a 92 34 sufficient vote of the board of directors. 92 35 3. If approval by members was required, both of the 93 1 following: 93 2 a. The designation, number of memberships outstanding, 93 3 number of votes entitled to be cast by each class entitled to 93 4 vote separately on the plan, and number of votes of each class 93 5 indisputably voting on the plan. 93 6 b. Either the total number of votes cast for and against 93 7 the plan by each class entitled to vote separately on the plan 93 8 or the total number of undisputed votes cast for the plan by 93 9 each class and a statement that the number of votes cast for 93 10 the plan by each class was sufficient for approval by that 93 11 class. 93 12 4. If approval of the plan by some person or persons other 93 13 than the members of the board is required pursuant to section 93 14 504A.1103, subsection 1, paragraph "c", a statement that the 93 15 approval was obtained. 93 16 Sec. 131. NEW SECTION. 504A.1105 EFFECT OF MERGER. 93 17 When a merger takes effect, all of the following occur: 93 18 1. Every other corporation party to the merger merges into 93 19 the surviving corporation and the separate existence of every 93 20 corporation except the surviving corporation ceases. 93 21 2. The title to all real estate and other property owned 93 22 by each corporation party to the merger is vested in the 93 23 surviving corporation without reversion or impairment subject 93 24 to any and all conditions to which the property was subject 93 25 prior to the merger. 93 26 3. The surviving corporation has all the liabilities and 93 27 obligations of each corporation party to the merger. 93 28 4. A proceeding pending against any corporation party to 93 29 the merger may be continued as if the merger did not occur or 93 30 the surviving corporation may be substituted in the proceeding 93 31 for the corporation whose existence ceased. 93 32 5. The articles of incorporation and bylaws of the 93 33 surviving corporation are amended to the extent provided in 93 34 the plan of merger. 93 35 Sec. 132. NEW SECTION. 504A.1106 MERGER WITH FOREIGN 94 1 CORPORATION. 94 2 1. Except as provided in section 504A.1102, one or more 94 3 foreign business or nonprofit corporations may merge with one 94 4 or more domestic nonprofit corporations if all of the 94 5 following conditions are met: 94 6 a. The merger is permitted by the law of the state or 94 7 country under whose law each foreign corporation is 94 8 incorporated and each foreign corporation complies with that 94 9 law in effecting the merger. 94 10 b. The foreign corporation complies with section 504A.1104 94 11 if it is the surviving corporation of the merger. 94 12 c. Each domestic nonprofit corporation complies with the 94 13 applicable provisions of sections 504A.1101 through 504A.1103 94 14 and, if it is the surviving corporation of the merger, with 94 15 section 504A.1104. 94 16 2. Upon the merger taking effect, the surviving foreign 94 17 business or nonprofit corporation is deemed to have 94 18 irrevocably appointed the secretary of state as its agent for 94 19 service of process in any proceeding brought against it. 94 20 Sec. 133. NEW SECTION. 504A.1107 BEQUESTS, DEVISES, AND 94 21 GIFTS. 94 22 Any bequest, devise, gift, grant, or promise contained in a 94 23 will or other instrument of donation, subscription, or 94 24 conveyance, that is made to a constituent corporation and 94 25 which takes effect or remains payable after the merger, inures 94 26 to the surviving corporation unless the will or other 94 27 instrument otherwise specifically provides. 94 28 SUBCHAPTER XII 94 29 SALE OF ASSETS 94 30 Sec. 134. NEW SECTION. 504A.1201 SALE OF ASSETS IN 94 31 REGULAR COURSE OF ACTIVITIES AND MORTGAGE OF ASSETS. 94 32 1. A corporation may on the terms and conditions and for 94 33 the consideration determined by the board of directors do 94 34 either of the following: 94 35 a. Sell, lease, exchange, or otherwise dispose of all, or 95 1 substantially all, of its property in the usual and regular 95 2 course of its activities. 95 3 b. Mortgage, pledge, dedicate to the repayment of 95 4 indebtedness, whether with or without recourse, or otherwise 95 5 encumber any or all of its property whether or not in the 95 6 usual and regular course of its activities. 95 7 2. Unless the articles require it, approval of the members 95 8 or any other persons of a transaction described in subsection 95 9 1 is not required. 95 10 Sec. 135. NEW SECTION. 504A.1202 SALE OF ASSETS OTHER 95 11 THAN IN REGULAR COURSE OF ACTIVITIES. 95 12 1. A corporation may sell, lease, exchange, or otherwise 95 13 dispose of all, or substantially all, of its property, with or 95 14 without the goodwill, other than in the usual and regular 95 15 course of its activities on the terms and conditions and for 95 16 the consideration determined by the corporation's board if the 95 17 proposed transaction is authorized by subsection 2. 95 18 2. Unless this chapter, the articles, bylaws, or the board 95 19 of directors or members acting pursuant to subsection 4 95 20 require a greater vote or voting by a class, the proposed 95 21 transaction to be authorized must be approved by all of the 95 22 following: 95 23 a. The board. 95 24 b. The members by two-thirds of the votes cast or a 95 25 majority of the voting power, whichever is less. 95 26 c. In writing by any person or persons whose approval is 95 27 required by a provision of the articles authorized by section 95 28 504A.1031 for an amendment to the articles or bylaws. 95 29 3. If the corporation does not have members, the 95 30 transaction must be approved by a vote of a majority of the 95 31 directors in office at the time the transaction is approved. 95 32 In addition, the corporation shall provide notice of any 95 33 directors' meeting at which such approval is to be obtained in 95 34 accordance with section 504A.823, subsection 3. The notice 95 35 shall also state that the purpose, or one of the purposes, of 96 1 the meeting is to consider the sale, lease, exchange, or other 96 2 disposition of all, or substantially all, of the property or 96 3 assets of the corporation and contain or be accompanied by a 96 4 copy or summary of a description of the transaction. 96 5 4. The board may condition its submission of the proposed 96 6 transaction, and the members may condition their approval of 96 7 the transaction, on receipt of a higher percentage of 96 8 affirmative votes or on any other basis. 96 9 5. If the corporation seeks to have the transaction 96 10 approved by the members at a membership meeting, the 96 11 corporation shall give notice to its members of the proposed 96 12 membership meeting in accordance with section 504A.705. The 96 13 notice must also state that the purpose, or one of the 96 14 purposes, of the meeting is to consider the sale, lease, 96 15 exchange, or other disposition of all, or substantially all, 96 16 of the property or assets of the corporation and contain or be 96 17 accompanied by a copy or summary of a description of the 96 18 transaction. 96 19 6. If the board is required to have the transaction 96 20 approved by the members by written consent or written ballot, 96 21 the material soliciting the approval shall contain or be 96 22 accompanied by a copy or summary of a description of the 96 23 transaction. 96 24 7. A public benefit or religious corporation shall give 96 25 written notice to the attorney general twenty days before it 96 26 sells, leases, exchanges, or otherwise disposes of all, or 96 27 substantially all, of its property if the transaction is not 96 28 in the usual and regular course of its activities unless the 96 29 attorney general has given the corporation a written waiver of 96 30 the requirements of this subsection. The attorney general 96 31 shall be deemed to have consented to the transaction unless 96 32 notice is given to the corporation within the twenty days. 96 33 8. After a sale, lease, exchange, or other disposition of 96 34 property is authorized, the transaction may be abandoned, 96 35 subject to any contractual rights, without further action by 97 1 the members or any other person who approved the transaction 97 2 in accordance with the procedure set forth in the resolution 97 3 proposing the transaction or, if none is set forth, in the 97 4 manner determined by the board of directors. 97 5 SUBCHAPTER XIII 97 6 DISTRIBUTIONS 97 7 Sec. 136. NEW SECTION. 504A.1301 PROHIBITED 97 8 DISTRIBUTIONS. 97 9 Except as authorized by section 504A.1302, a corporation 97 10 shall not make any distributions. 97 11 Sec. 137. NEW SECTION. 504A.1302 AUTHORIZED 97 12 DISTRIBUTIONS. 97 13 1. A mutual benefit corporation may purchase its 97 14 memberships if after the purchase is completed, both of the 97 15 following apply: 97 16 a. The corporation will be able to pay its debts as they 97 17 become due in the usual course of its activities. 97 18 b. The corporation's total assets will at least equal the 97 19 sum of its total liabilities. 97 20 2. Corporations may make distributions upon dissolution in 97 21 conformity with subchapter 14. 97 22 SUBCHAPTER XIV 97 23 DISSOLUTION 97 24 PART 1 97 25 VOLUNTARY DISSOLUTION 97 26 Sec. 138. NEW SECTION. 504A.1401 DISSOLUTION BY 97 27 INCORPORATORS OR DIRECTORS AND THIRD PERSONS. 97 28 1. A majority of the incorporators of a corporation that 97 29 has no directors and no members or a majority of the directors 97 30 of a corporation that has no members may, subject to any 97 31 approval required by the articles or bylaws, dissolve the 97 32 corporation by delivering articles of dissolution to the 97 33 secretary of state. 97 34 2. The corporation shall give notice of any meeting at 97 35 which dissolution will be approved. The notice must be in 98 1 accordance with section 504A.823, subsection 3. The notice 98 2 must also state that the purpose, or one of the purposes, of 98 3 the meeting is to consider dissolution of the corporation. 98 4 3. The incorporators or directors in approving dissolution 98 5 shall adopt a plan of dissolution indicating to whom the 98 6 assets owned or held by the corporation will be distributed 98 7 after all creditors have been paid. 98 8 Sec. 139. NEW SECTION. 504A.1402 DISSOLUTION BY 98 9 DIRECTORS, MEMBERS, AND THIRD PERSONS. 98 10 1. Unless this chapter, the articles, bylaws, or the board 98 11 of directors or members acting pursuant to subsection 3 98 12 require a greater vote or voting by class, dissolution is 98 13 authorized if it is approved by all of the following: 98 14 a. The board. 98 15 b. The members, if any, by two-thirds of the votes cast or 98 16 a majority of the voting power, whichever is less. 98 17 c. In writing by any person or persons whose approval is 98 18 required by a provision of the articles authorized by section 98 19 504A.1031 for an amendment to the articles or bylaws. 98 20 2. If the corporation does not have members, dissolution 98 21 must be approved by a vote of a majority of the directors in 98 22 office at the time the transaction is approved. In addition, 98 23 the corporation shall provide notice of any directors' meeting 98 24 at which such approval is to be obtained in accordance with 98 25 section 504A.823, subsection 3. The notice must also state 98 26 that the purpose, or one of the purposes, of the meeting is to 98 27 consider dissolution of the corporation and contain or be 98 28 accompanied by a copy or summary of the plan of dissolution. 98 29 3. The board may condition its submission of the proposed 98 30 dissolution, and the members may condition their approval of 98 31 the dissolution, on receipt of a higher percentage of 98 32 affirmative votes or on any other basis. 98 33 4. If the board seeks to have dissolution approved by the 98 34 members at a membership meeting, the corporation shall give 98 35 notice to its members of the proposed membership meeting in 99 1 accordance with section 504A.705. The notice must also state 99 2 that the purpose, or one of the purposes, of the meeting is to 99 3 consider dissolving the corporation and must contain or be 99 4 accompanied by a copy or summary of the plan of dissolution. 99 5 5. If the board seeks to have the dissolution approved by 99 6 the members by written consent or written ballot, the material 99 7 soliciting the approval shall contain or be accompanied by a 99 8 copy or summary of the plan of dissolution. 99 9 6. The plan of dissolution shall indicate to whom the 99 10 assets owned or held by the corporation will be distributed 99 11 after all creditors have been paid. 99 12 Sec. 140. NEW SECTION. 504A.1403 NOTICES TO THE ATTORNEY 99 13 GENERAL. 99 14 1. A public benefit or religious corporation shall give 99 15 the attorney general written notice that it intends to 99 16 dissolve at or before the time it delivers articles of 99 17 dissolution to the secretary of state. The notice shall 99 18 include a copy or summary of the plan of dissolution. 99 19 2. Assets shall not be transferred or conveyed by a public 99 20 benefit or religious corporation as part of the dissolution 99 21 process until twenty days after it has given the written 99 22 notice required by subsection 1 to the attorney general or 99 23 until the attorney general has consented in writing to, or 99 24 indicated in writing that, the attorney general will take no 99 25 action in respect to the transfer or conveyance, whichever is 99 26 earlier. 99 27 3. When all or substantially all of the assets of a public 99 28 benefit corporation have been transferred or conveyed 99 29 following approval of dissolution, the board shall deliver to 99 30 the attorney general a list showing to whom, other than 99 31 creditors, the assets were transferred or conveyed. The list 99 32 shall indicate the addresses of each person, other than 99 33 creditors, who received assets and indicate what assets each 99 34 received. 99 35 Sec. 141. NEW SECTION. 504A.1404 ARTICLES OF 100 1 DISSOLUTION. 100 2 1. At any time after dissolution is authorized, a 100 3 corporation may dissolve by delivering articles of dissolution 100 4 to the secretary of state setting forth all of the following: 100 5 a. The name of the corporation. 100 6 b. The date dissolution was authorized. 100 7 c. A statement that dissolution was approved by a 100 8 sufficient vote of the board. 100 9 d. If approval of members was not required, a statement to 100 10 that effect and a statement that dissolution was approved by a 100 11 sufficient vote of the board of directors or incorporators. 100 12 e. If approval by members was required, both of the 100 13 following: 100 14 (1) The designation, number of memberships outstanding, 100 15 number of votes entitled to be cast by each class entitled to 100 16 vote separately on dissolution, and number of votes of each 100 17 class indisputably voting on dissolution. 100 18 (2) Either the total number of votes cast for and against 100 19 dissolution by each class entitled to vote separately on 100 20 dissolution or the total number of undisputed votes cast for 100 21 dissolution by each class and a statement that the number cast 100 22 for dissolution by each class was sufficient for approval by 100 23 that class. 100 24 f. If approval of dissolution by some person or persons 100 25 other than the members, the board, or the incorporators is 100 26 required pursuant to section 504A.1402, subsection 1, 100 27 paragraph "c", a statement that the approval was obtained. 100 28 g. If the corporation is a public benefit or religious 100 29 corporation, that the notice to the attorney general required 100 30 by section 504A.1403, subsection 1, has been given. 100 31 2. A corporation is dissolved upon the effective date of 100 32 its articles of dissolution. 100 33 Sec. 142. NEW SECTION. 504A.1405 REVOCATION OF 100 34 DISSOLUTION. 100 35 1. A corporation may revoke its dissolution within one 101 1 hundred twenty days of its effective date. 101 2 2. Revocation of dissolution must be authorized in the 101 3 same manner as the dissolution was authorized unless that 101 4 authorization permitted revocation by action of the board of 101 5 directors alone, in which event the board of directors may 101 6 revoke the dissolution without action by the members or any 101 7 other person. 101 8 3. After the revocation of dissolution is authorized, the 101 9 corporation may revoke the dissolution by delivering to the 101 10 secretary of state for filing, articles of revocation of 101 11 dissolution, together with a copy of its articles of 101 12 dissolution, that set forth all of the following: 101 13 a. The name of the corporation. 101 14 b. The effective date of the dissolution that was revoked. 101 15 c. The date that the revocation of dissolution was 101 16 authorized. 101 17 d. If the corporation's board of directors or 101 18 incorporators revoked the dissolution, a statement to that 101 19 effect. 101 20 e. If the corporation's board of directors revoked a 101 21 dissolution authorized by the members alone or in conjunction 101 22 with another person or persons, a statement that revocation 101 23 was permitted by action of the board of directors alone 101 24 pursuant to that authorization. 101 25 f. If member or third person action was required to revoke 101 26 the dissolution, the information required by section 101 27 504A.1404, subsection 1, paragraphs "e" and "f". 101 28 4. Revocation of dissolution is effective upon the 101 29 effective date of the articles of revocation of dissolution. 101 30 5. When the revocation of dissolution is effective, it 101 31 relates back to and takes effect as of the effective date of 101 32 the dissolution and the corporation resumes carrying on its 101 33 activities as if dissolution had never occurred. 101 34 Sec. 143. NEW SECTION. 504A.1406 EFFECT OF DISSOLUTION. 101 35 1. A dissolved corporation continues its corporate 102 1 existence but shall not carry on any activities except those 102 2 appropriate to wind up and liquidate its affairs, including 102 3 all of the following: 102 4 a. Preserving and protecting its assets and minimizing its 102 5 liabilities. 102 6 b. Discharging or making provision for discharging its 102 7 liabilities and obligations. 102 8 c. Disposing of its properties that will not be 102 9 distributed in kind. 102 10 d. Returning, transferring, or conveying assets held by 102 11 the corporation upon a condition requiring return, transfer, 102 12 or conveyance, which condition occurs by reason of the 102 13 dissolution, in accordance with such condition. 102 14 e. Transferring, subject to any contractual or legal 102 15 requirements, its assets as provided in or authorized by its 102 16 articles of incorporation or bylaws. 102 17 f. If the corporation is a public benefit or religious 102 18 corporation, and a provision has not been made in its articles 102 19 or bylaws for distribution of assets on dissolution, 102 20 transferring, subject to any contractual or legal requirement, 102 21 its assets to one or more persons described in section 102 22 501(c)(3) of the Internal Revenue Code, or if the dissolved 102 23 corporation is not described in section 501(c)(3) of the 102 24 Internal Revenue Code, to one or more public benefit or 102 25 religious corporations. 102 26 g. If the corporation is a mutual benefit corporation and 102 27 a provision has not been made in its articles or bylaws for 102 28 distribution of assets on dissolution, transferring its assets 102 29 to its members or, if it has no members, those persons whom 102 30 the corporation holds itself out as benefiting or serving. 102 31 h. Doing every other act necessary to wind up and 102 32 liquidate its assets and affairs. 102 33 2. Dissolution of a corporation does not do any of the 102 34 following: 102 35 a. Transfer title to the corporation's property. 103 1 b. Subject its directors or officers to standards of 103 2 conduct different from those prescribed in subchapter 8. 103 3 c. Change quorum or voting requirements for its board or 103 4 members; change provisions for selection, resignation, or 103 5 removal of its directors or officers or both; or change 103 6 provisions for amending its bylaws. 103 7 d. Prevent commencement of a proceeding by or against the 103 8 corporation in its corporate name. 103 9 e. Abate or suspend a proceeding pending by or against the 103 10 corporation on the effective date of dissolution. 103 11 f. Terminate the authority of the registered agent. 103 12 Sec. 144. NEW SECTION. 504A.1407 KNOWN CLAIMS AGAINST 103 13 DISSOLVED CORPORATION. 103 14 1. A dissolved corporation may dispose of the known claims 103 15 against it by following the procedure described in this 103 16 section. 103 17 2. The dissolved corporation shall notify its known 103 18 claimants in writing of the dissolution at any time after the 103 19 effective date of the dissolution. The written notice must do 103 20 all of the following: 103 21 a. Describe information that must be included in a claim. 103 22 b. Provide a mailing address where a claim may be sent. 103 23 c. State the deadline, which shall not be fewer than one 103 24 hundred twenty days from the effective date of the written 103 25 notice, by which the dissolved corporation must receive the 103 26 claim. 103 27 d. State that the claim will be barred if not received by 103 28 the deadline. 103 29 3. A claim against the dissolved corporation is barred if 103 30 either of the following occurs: 103 31 a. A claimant who was given written notice under 103 32 subsection 2 does not deliver the claim to the dissolved 103 33 corporation by the deadline. 103 34 b. A claimant whose claim was rejected by the dissolved 103 35 corporation does not commence a proceeding to enforce the 104 1 claim within ninety days from the effective date of the 104 2 rejection notice. 104 3 4. For purposes of this section, "claim" does not include 104 4 a contingent liability or a claim based on an event occurring 104 5 after the effective date of dissolution. 104 6 Sec. 145. NEW SECTION. 504A.1408 UNKNOWN CLAIMS AGAINST 104 7 DISSOLVED CORPORATION. 104 8 1. A dissolved corporation may also publish notice of its 104 9 dissolution and request that persons with claims against the 104 10 corporation present them in accordance with the notice. 104 11 2. The notice must do all of the following: 104 12 a. Be published one time in a newspaper of general 104 13 circulation in the county where the dissolved corporation's 104 14 principal office is located, or, if none is located in this 104 15 state, where its registered office is or was last located. 104 16 b. Describe the information that must be included in a 104 17 claim and provide a mailing address where the claim may be 104 18 sent. 104 19 c. State that a claim against the corporation will be 104 20 barred unless a proceeding to enforce the claim is commenced 104 21 within five years after publication of the notice. 104 22 3. If the dissolved corporation publishes a newspaper 104 23 notice in accordance with subsection 2, the claim of each of 104 24 the following claimants is barred unless the claimant 104 25 commences a proceeding to enforce the claim against the 104 26 dissolved corporation within five years after the publication 104 27 date of the newspaper notice: 104 28 a. A claimant who did not receive written notice under 104 29 section 504A.1407. 104 30 b. A claimant whose claim was timely sent to the dissolved 104 31 corporation but not acted on. 104 32 c. A claimant whose claim is contingent or based on an 104 33 event occurring after the effective date of dissolution. 104 34 4. A claim may be enforced under this section to the 104 35 following extent, as applicable: 105 1 a. Against the dissolved corporation, to the extent of its 105 2 undistributed assets. 105 3 b. If the assets have been distributed in liquidation, 105 4 against any person, other than a creditor of the corporation, 105 5 to whom the corporation distributed its property to the extent 105 6 of the distributee's pro rata share of the claim or the 105 7 corporate assets distributed to such person in liquidation, 105 8 whichever is less, but the distributee's total liability for 105 9 all claims under this section shall not exceed the total 105 10 amount of assets distributed to the distributee. 105 11 PART 2 105 12 ADMINISTRATIVE DISSOLUTION 105 13 Sec. 146. NEW SECTION. 504A.1421 GROUNDS FOR 105 14 ADMINISTRATIVE DISSOLUTION. 105 15 The secretary of state may commence a proceeding under 105 16 section 504A.1422 to administratively dissolve a corporation 105 17 if any of the following occurs: 105 18 1. The corporation does not deliver its biennial report to 105 19 the secretary of state, in a form that meets the requirements 105 20 of section 504A.1613, within sixty days after the report is 105 21 due. 105 22 2. The corporation is without a registered agent or 105 23 registered office in this state for sixty days or more. 105 24 3. The corporation does not notify the secretary of state 105 25 within sixty days that its registered agent or registered 105 26 office has been changed, that its registered agent has 105 27 resigned, or that its registered office has been discontinued. 105 28 4. The corporation's period of duration, if any, stated in 105 29 its articles of incorporation expires. 105 30 Sec. 147. NEW SECTION. 504A.1422 PROCEDURE FOR AND 105 31 EFFECT OF ADMINISTRATIVE DISSOLUTION. 105 32 1. Upon determining that one or more grounds exist under 105 33 section 504A.1421 for dissolving a corporation, the secretary 105 34 of state shall serve the corporation with written notice of 105 35 that determination under section 504A.504, and in the case of 106 1 a public benefit corporation shall notify the attorney general 106 2 in writing of that determination. 106 3 2. If the corporation does not correct each ground for 106 4 dissolution or demonstrate to the reasonable satisfaction of 106 5 the secretary of state that each ground determined by the 106 6 secretary of state does not exist within at least sixty days 106 7 after service of notice is perfected under section 504A.504, 106 8 the secretary of state may administratively dissolve the 106 9 corporation by signing a certificate of dissolution that 106 10 recites the ground or grounds for dissolution and its 106 11 effective date. The secretary of state shall file the 106 12 original of the certificate of dissolution and serve a copy on 106 13 the corporation under section 504A.504, and in the case of a 106 14 public benefit corporation shall notify the attorney general 106 15 in writing of the dissolution. 106 16 3. A corporation administratively dissolved continues its 106 17 corporate existence but may not carry on any activities except 106 18 those necessary to wind up and liquidate its affairs pursuant 106 19 to section 504A.1406 and notify its claimants pursuant to 106 20 sections 504A.1407 and 504A.1408. 106 21 4. The administrative dissolution of a corporation does 106 22 not terminate the authority of its registered agent. 106 23 5. The secretary of state's administrative dissolution of 106 24 a corporation pursuant to this section appoints the secretary 106 25 of state as the corporation's agent for service of process in 106 26 any proceeding based on a cause of action which arose during 106 27 the time the corporation was authorized to transact business 106 28 in this state. Service of process on the secretary of state 106 29 under this subsection is service on the corporation. Upon 106 30 receipt of process, the secretary of state shall serve a copy 106 31 of the process on the corporation as provided in section 106 32 504A.504. This subsection does not preclude service on the 106 33 corporation's registered agent, if any. 106 34 Sec. 148. NEW SECTION. 504A.1423 REINSTATEMENT FOLLOWING 106 35 ADMINISTRATIVE DISSOLUTION. 107 1 1. A corporation administratively dissolved under section 107 2 504A.1422 may apply to the secretary of state for 107 3 reinstatement within two years after the effective date of 107 4 dissolution. The application must state all of the following: 107 5 a. The name of the corporation and the effective date of 107 6 its administrative dissolution. 107 7 b. That the ground or grounds for dissolution either did 107 8 not exist or have been eliminated. 107 9 c. That the corporation's name satisfies the requirements 107 10 of section 504A.401. 107 11 d. The federal tax identification number of the 107 12 corporation. 107 13 2. a. The secretary of state shall refer the federal tax 107 14 identification number contained in the application for 107 15 reinstatement to the department of revenue and finance. The 107 16 department of revenue and finance shall report to the 107 17 secretary of state the tax status of the corporation. If the 107 18 department reports to the secretary of state that a filing 107 19 delinquency or liability exists against the corporation, the 107 20 secretary of state shall not cancel the certificate of 107 21 dissolution until the filing delinquency or liability is 107 22 satisfied. 107 23 b. If the secretary of state determines that the 107 24 application contains the information required by subsection 1, 107 25 that a delinquency or liability reported pursuant to paragraph 107 26 "a" has been satisfied, and that all of the application 107 27 information is correct, the secretary of state shall cancel 107 28 the certificate of dissolution and prepare a certificate of 107 29 reinstatement reciting that determination and the effective 107 30 date of reinstatement, file the original of the certificate, 107 31 and serve a copy on the corporation under section 504A.504. 107 32 If the corporate name in subsection 1, paragraph "c", is 107 33 different from the corporate name in subsection 1, paragraph 107 34 "a", the certificate of reinstatement shall constitute an 107 35 amendment to the articles of incorporation insofar as it 108 1 pertains to the corporate name. 108 2 3. When reinstatement is effective, it relates back to and 108 3 takes effect as of the effective date of the administrative 108 4 dissolution and the corporation shall resume carrying on its 108 5 activities as if the administrative dissolution had never 108 6 occurred. 108 7 Sec. 149. NEW SECTION. 504A.1424 APPEAL FROM DENIAL OF 108 8 REINSTATEMENT. 108 9 1. The secretary of state, upon denying a corporation's 108 10 application for reinstatement following administrative 108 11 dissolution, shall serve the corporation under section 108 12 504A.504 with a written notice that explains the reason or 108 13 reasons for denial. 108 14 2. The corporation may appeal the denial of reinstatement 108 15 to the district court within ninety days after service of the 108 16 notice of denial is perfected by petitioning to set aside the 108 17 dissolution and attaching to the petition copies of the 108 18 secretary of state's certificate of dissolution, the 108 19 corporation's application for reinstatement, and the secretary 108 20 of state's notice of denial of reinstatement. 108 21 3. The court may summarily order the secretary of state to 108 22 reinstate the dissolved corporation or may take other action 108 23 the court considers appropriate. 108 24 4. The court's final decision may be appealed as in other 108 25 civil proceedings. 108 26 PART 3 108 27 JUDICIAL DISSOLUTION 108 28 Sec. 150. NEW SECTION. 504A.1431 GROUNDS FOR JUDICIAL 108 29 DISSOLUTION. 108 30 1. The district court may dissolve a corporation in any of 108 31 the following ways: 108 32 a. In a proceeding brought by the attorney general, if any 108 33 of the following is established: 108 34 (1) The corporation obtained its articles of incorporation 108 35 through fraud. 109 1 (2) The corporation has continued to exceed or abuse the 109 2 authority conferred upon it by law. 109 3 (3) The corporation is a public benefit corporation and 109 4 the corporate assets are being misapplied or wasted. 109 5 (4) The corporation is a public benefit corporation and is 109 6 no longer able to carry out its purposes. 109 7 b. Except as provided in the articles or bylaws of a 109 8 religious corporation, in a proceeding brought by fifty 109 9 members or members holding five percent of the voting power, 109 10 whichever is less, or by a director or any person specified in 109 11 the articles, if any of the following is established: 109 12 (1) The directors are deadlocked in the management of the 109 13 corporate affairs, and the members, if any, are unable to 109 14 break the deadlock. 109 15 (2) The directors or those in control of the corporation 109 16 have acted, are acting, or will act in a manner that is 109 17 illegal, oppressive, or fraudulent. 109 18 (3) The members are deadlocked in voting power and have 109 19 failed, for a period that includes at least two consecutive 109 20 annual meeting dates, to elect successors to directors whose 109 21 terms have, or would otherwise have, expired. 109 22 (4) The corporate assets are being misapplied or wasted. 109 23 (5) The corporation is a public benefit or religious 109 24 corporation and is no longer able to carry out its purposes. 109 25 c. In a proceeding brought by a creditor, if either of the 109 26 following is established: 109 27 (1) The creditor's claim has been reduced to judgment, the 109 28 execution on the judgment is returned unsatisfied, and the 109 29 corporation is insolvent. 109 30 (2) The corporation has admitted in writing that the 109 31 creditor's claim is due and owing and the corporation is 109 32 insolvent. 109 33 d. In a proceeding brought by the corporation to have its 109 34 voluntary dissolution continued under court supervision. 109 35 2. Prior to dissolving a corporation, the court shall 110 1 consider whether: 110 2 a. There are reasonable alternatives to dissolution. 110 3 b. Dissolution is in the public interest, if the 110 4 corporation is a public benefit corporation. 110 5 c. Dissolution is the best way of protecting the interests 110 6 of members, if the corporation is a mutual benefit 110 7 corporation. 110 8 Sec. 151. NEW SECTION. 504A.1432 PROCEDURE FOR JUDICIAL 110 9 DISSOLUTION. 110 10 1. Venue for a proceeding brought by the attorney general 110 11 to dissolve a corporation lies in Polk county. Venue for a 110 12 proceeding brought by any other party named in section 110 13 504A.1431 lies in the county where a corporation's principal 110 14 office is located or, if none is located in this state, where 110 15 its registered office is or was last located. 110 16 2. It is not necessary to make directors or members 110 17 parties to a proceeding to dissolve a corporation unless 110 18 relief is sought against them individually. 110 19 3. A court in a proceeding brought to dissolve a 110 20 corporation may issue injunctions, appoint a receiver or 110 21 custodian pendente lite with all powers and duties the court 110 22 directs, take other action required to preserve the corporate 110 23 assets wherever located, or carry on the activities of the 110 24 corporation until a full hearing can be held. 110 25 4. A person other than the attorney general who brings an 110 26 involuntary dissolution proceeding for a public benefit or 110 27 religious corporation shall immediately give written notice of 110 28 the proceeding to the attorney general who may then intervene. 110 29 Sec. 152. NEW SECTION. 504A.1433 RECEIVERSHIP OR 110 30 CUSTODIANSHIP. 110 31 1. A court in a judicial proceeding brought to dissolve a 110 32 public benefit or mutual benefit corporation may appoint one 110 33 or more receivers to wind up and liquidate, or one or more 110 34 custodians to manage, the affairs of the corporation. The 110 35 court shall hold a hearing, after notifying all parties to the 111 1 proceeding and any interested persons designated by the court, 111 2 before appointing a receiver or custodian. The court 111 3 appointing a receiver or custodian has exclusive jurisdiction 111 4 over the corporation and all of its property wherever located. 111 5 2. The court may appoint an individual, or a domestic or 111 6 foreign business or nonprofit corporation authorized to 111 7 transact business in this state as a receiver or custodian. 111 8 The court may require the receiver or custodian to post bond, 111 9 with or without sureties, in an amount the court directs. 111 10 3. The court shall describe the powers and duties of the 111 11 receiver or custodian in its appointing order, which may be 111 12 amended including the following: 111 13 a. The receiver or custodian may dispose of all or any 111 14 part of the assets of the corporation wherever located, at a 111 15 public or private sale, if authorized by the court. However, 111 16 the receiver's or custodian's power to dispose of the assets 111 17 of the corporation is subject to any trust and other 111 18 restrictions that would be applicable to the corporation. The 111 19 receiver or custodian may sue and defend in the receiver's or 111 20 custodian's name as receiver or custodian of the corporation, 111 21 as applicable, in all courts of this state. 111 22 b. The custodian may exercise all of the powers of the 111 23 corporation, through or in place of its board of directors or 111 24 officers, to the extent necessary to manage the affairs of the 111 25 corporation in the best interests of its members and 111 26 creditors. 111 27 4. The court during a receivership may redesignate the 111 28 receiver a custodian, and during a custodianship may 111 29 redesignate the custodian a receiver, if doing so is in the 111 30 best interests of the corporation, its members, and creditors. 111 31 5. The court during the receivership or custodianship may 111 32 order compensation paid and expense disbursements or 111 33 reimbursements made to the receiver or custodian and to the 111 34 receiver's or custodian's attorney from the assets of the 111 35 corporation or proceeds from the sale of the assets. 112 1 Sec. 153. NEW SECTION. 504A.1434 DECREE OF DISSOLUTION. 112 2 1. If after a hearing the court determines that one or 112 3 more grounds for judicial dissolution described in section 112 4 504A.1431 exist, the court may enter a decree dissolving the 112 5 corporation and specifying the effective date of the 112 6 dissolution, and the clerk of the court shall deliver a 112 7 certified copy of the decree to the secretary of state, who 112 8 shall file it. 112 9 2. After entering the decree of dissolution, the court 112 10 shall direct the winding up of the corporation's affairs and 112 11 liquidation of the corporation in accordance with section 112 12 504A.1406 and the notification of its claimants in accordance 112 13 with sections 504A.1407 and 504A.1408. 112 14 PART 4 112 15 MISCELLANEOUS 112 16 Sec. 154. NEW SECTION. 504A.1441 DEPOSIT WITH STATE 112 17 TREASURER. 112 18 Assets of a dissolved corporation which should be 112 19 transferred to a creditor, claimant, or member of the 112 20 corporation who cannot be found or who is not competent to 112 21 receive them shall be reduced to cash subject to known trust 112 22 restrictions and deposited with the treasurer of state for 112 23 safekeeping. However, in the treasurer of state's discretion, 112 24 property may be received and held in kind. When the creditor, 112 25 claimant, or member furnishes satisfactory proof of 112 26 entitlement to the amount deposited or property held in kind, 112 27 the treasurer of state shall deliver to the creditor, member, 112 28 or other person or to the representative of the creditor, 112 29 member, or other person that amount or property. 112 30 SUBCHAPTER XV 112 31 FOREIGN CORPORATIONS 112 32 PART 1 112 33 CERTIFICATE OF AUTHORITY 112 34 Sec. 155. NEW SECTION. 504A.1501 AUTHORITY TO TRANSACT 112 35 BUSINESS REQUIRED. 113 1 1. A foreign corporation shall not transact business in 113 2 this state until it obtains a certificate of authority from 113 3 the secretary of state. 113 4 2. The following activities, among others, do not 113 5 constitute transacting business within the meaning of 113 6 subsection 1: 113 7 a. Maintaining, defending, or settling any proceeding. 113 8 b. Holding meetings of the board of directors or members 113 9 or carrying on other activities concerning internal corporate 113 10 affairs. 113 11 c. Maintaining bank accounts. 113 12 d. Maintaining offices or agencies for the transfer, 113 13 exchange, or registration of memberships or securities or 113 14 maintaining trustees or depositaries with respect to those 113 15 securities. 113 16 e. Selling through independent contractors. 113 17 f. Soliciting or obtaining orders, whether by mail or 113 18 through employees or agents or otherwise, if the orders 113 19 require acceptance outside this state before they become 113 20 contracts. 113 21 g. Creating or acquiring indebtedness, mortgages, or 113 22 security interests in real or personal property. 113 23 h. Securing or collecting debts or enforcing mortgages or 113 24 security interests in property securing the debts. 113 25 i. Owning, without more, real or personal property. 113 26 j. Conducting an isolated transaction that is completed 113 27 within thirty days and that is not one in the course of 113 28 repeated transactions of a like nature. 113 29 k. Transacting business in interstate commerce. 113 30 Sec. 156. NEW SECTION. 504A.1502 CONSEQUENCES OF 113 31 TRANSACTING BUSINESS WITHOUT AUTHORITY. 113 32 1. A foreign corporation transacting business in this 113 33 state without a certificate of authority shall not maintain a 113 34 proceeding in any court in this state until it obtains a 113 35 certificate of authority. 114 1 2. The successor to a foreign corporation that transacted 114 2 business in this state without a certificate of authority and 114 3 the assignee of a cause of action arising out of that business 114 4 shall not maintain a proceeding on that cause of action in any 114 5 court in this state until the foreign corporation or its 114 6 successor obtains a certificate of authority. 114 7 3. A court may stay a proceeding commenced by a foreign 114 8 corporation, its successor, or assignee until the court 114 9 determines whether the foreign corporation or its successor 114 10 requires a certificate of authority. If it so determines, the 114 11 court may further stay the proceeding until the foreign 114 12 corporation or its successor obtains the certificate. 114 13 4. A foreign corporation is liable for a civil penalty of 114 14 an amount not to exceed a total of one thousand dollars if it 114 15 transacts business in this state without a certificate of 114 16 authority. The attorney general may collect all penalties due 114 17 under this subsection. 114 18 5. Notwithstanding subsections 1 and 2, the failure of a 114 19 foreign corporation to obtain a certificate of authority does 114 20 not impair the validity of its corporate acts or prevent it 114 21 from defending any proceeding in this state. 114 22 Sec. 157. NEW SECTION. 504A.1503 APPLICATION FOR 114 23 CERTIFICATE OF AUTHORITY. 114 24 1. A foreign corporation may apply for a certificate of 114 25 authority to transact business in this state by delivering an 114 26 application to the secretary of state. The application must 114 27 set forth all of the following: 114 28 a. The name of the foreign corporation or, if its name is 114 29 unavailable for use in this state, a corporate name that 114 30 satisfies the requirements of section 504A.1506. 114 31 b. The name of the state or country under whose law it is 114 32 incorporated. 114 33 c. The date of incorporation and period of duration. 114 34 d. The address of its principal office. 114 35 e. The address of its registered office in this state and 115 1 the name of its registered agent at that office. 115 2 f. The names and usual business or home addresses of its 115 3 current directors and officers. 115 4 g. Whether the foreign corporation has members. 115 5 h. Whether the corporation, if it had been incorporated in 115 6 this state, would be a public benefit, mutual benefit, or 115 7 religious corporation. 115 8 2. The foreign corporation shall deliver the completed 115 9 application to the secretary of state, and shall also deliver 115 10 to the secretary of state a certificate of existence or a 115 11 document of similar import duly authenticated by the secretary 115 12 of state or other official having custody of corporate records 115 13 in the state or country under whose law it is incorporated 115 14 which is dated no earlier than ninety days prior to the date 115 15 the application is filed with the secretary of state. 115 16 Sec. 158. NEW SECTION. 504A.1504 AMENDED CERTIFICATE OF 115 17 AUTHORITY. 115 18 1. A foreign corporation authorized to transact business 115 19 in this state shall obtain an amended certificate of authority 115 20 from the secretary of state if it changes any of the 115 21 following: 115 22 a. Its corporate name. 115 23 b. The period of its duration. 115 24 c. The state or country of its incorporation. 115 25 2. The requirements of section 504A.1503 for obtaining an 115 26 original certificate of authority apply to obtaining an 115 27 amended certificate under this section. 115 28 Sec. 159. NEW SECTION. 504A.1505 EFFECT OF CERTIFICATE 115 29 OF AUTHORITY. 115 30 1. A certificate of authority authorizes the foreign 115 31 corporation to which it is issued to transact business in this 115 32 state subject, however, to the right of the state to revoke 115 33 the certificate as provided in this chapter. 115 34 2. A foreign corporation with a valid certificate of 115 35 authority has the same rights and has the same privileges as 116 1 and, except as otherwise provided by this chapter, is subject 116 2 to the same duties, restrictions, penalties, and liabilities 116 3 now or later imposed on a domestic corporation of like 116 4 character. 116 5 3. This chapter does not authorize this state to regulate 116 6 the organization or internal affairs of a foreign corporation 116 7 authorized to transact business in this state. 116 8 Sec. 160. NEW SECTION. 504A.1506 CORPORATE NAME OF 116 9 FOREIGN CORPORATION. 116 10 1. If the corporate name of a foreign corporation does not 116 11 satisfy the requirements of section 504A.401, the foreign 116 12 corporation, to obtain or maintain a certificate of authority 116 13 to transact business in this state, may use a fictitious name 116 14 to transact business in this state if the corporation's real 116 15 name is unavailable and it delivers to the secretary of state 116 16 for filing a copy of the resolution of its board of directors, 116 17 certified by its secretary, adopting the fictitious name. 116 18 2. Except as authorized by subsections 3 and 4, the 116 19 corporate name of a foreign corporation, including a 116 20 fictitious name, must be distinguishable upon the records of 116 21 the secretary of state from all of the following: 116 22 a. The corporate name of a nonprofit or business 116 23 corporation incorporated or authorized to transact business in 116 24 this state. 116 25 b. A corporate name reserved or registered under section 116 26 504A.402 or 504A.403 or section 490.402 or 490.403. 116 27 c. The fictitious name of another foreign business or 116 28 nonprofit corporation authorized to transact business in this 116 29 state. 116 30 3. A foreign corporation may apply to the secretary of 116 31 state for authorization to use in this state the name of 116 32 another corporation incorporated or authorized to transact 116 33 business in this state that is not distinguishable upon the 116 34 records of the secretary of state from the name applied for. 116 35 The secretary of state shall authorize use of the name applied 117 1 for if either of the following applies: 117 2 a. The other corporation consents to the use in writing 117 3 and submits an undertaking in a form satisfactory to the 117 4 secretary of state to change its name to a name that is 117 5 distinguishable upon the records of the secretary of state 117 6 from the name of the applying corporation. 117 7 b. The applicant delivers to the secretary of state a 117 8 certified copy of a final judgment of a court of competent 117 9 jurisdiction establishing the applicant's right to use the 117 10 name applied for in this state. 117 11 4. A foreign corporation may use in this state the name, 117 12 including the fictitious name, of another domestic or foreign 117 13 business or nonprofit corporation that is used in this state 117 14 if the other corporation is incorporated or authorized to 117 15 transact business in this state and the foreign corporation 117 16 has filed documentation satisfactory to the secretary of state 117 17 of the occurrence of any of the following: 117 18 a. The foreign corporation has merged with the other 117 19 corporation. 117 20 b. The foreign corporation has been formed by 117 21 reorganization of the other corporation. 117 22 c. The foreign corporation has acquired all or 117 23 substantially all of the assets, including the corporate name, 117 24 of the other corporation. 117 25 5. If a foreign corporation authorized to transact 117 26 business in this state changes its corporate name to one that 117 27 does not satisfy the requirements of section 504A.401, it 117 28 shall not transact business in this state under the changed 117 29 name until it adopts a name satisfying the requirements of 117 30 section 504A.401 and obtains an amended certificate of 117 31 authority under section 504A.1504. 117 32 Sec. 161. NEW SECTION. 504A.1507 REGISTERED OFFICE AND 117 33 REGISTERED AGENT OF FOREIGN CORPORATION. 117 34 Each foreign corporation authorized to transact business in 117 35 this state shall continuously maintain in this state both of 118 1 the following: 118 2 1. A registered office with the same address as that of 118 3 its registered agent. 118 4 2. A registered agent, who may be any of the following: 118 5 a. An individual who resides in this state and whose 118 6 office is identical to the registered office. 118 7 b. A domestic business or nonprofit corporation whose 118 8 office is identical to the registered office. 118 9 c. A foreign business or nonprofit corporation authorized 118 10 to transact business in this state whose office is identical 118 11 to the registered office. 118 12 Sec. 162. NEW SECTION. 504A.1508 CHANGE OF REGISTERED 118 13 OFFICE OR REGISTERED AGENT OF FOREIGN CORPORATION. 118 14 1. A foreign corporation authorized to transact business 118 15 in this state may change its registered office or registered 118 16 agent by delivering to the secretary of state for filing a 118 17 statement of change that sets forth all of the following that 118 18 apply: 118 19 a. The name of its registered office or registered agent. 118 20 b. If the current registered office is to be changed, the 118 21 address of its new registered office. 118 22 c. If the current registered agent is to be changed, the 118 23 name of its new registered agent and the new agent's written 118 24 consent to the appointment, either on the statement or 118 25 attached to it. 118 26 d. That after the change or changes are made, the 118 27 addresses of its registered office and the office of its 118 28 registered agent will be identical. 118 29 2. If a registered agent changes the address of its 118 30 business office, the agent may change the address of the 118 31 registered office of any foreign corporation for which the 118 32 agent is the registered agent by notifying the corporation in 118 33 writing of the change and signing either manually or in 118 34 facsimile and delivering to the secretary of state for filing 118 35 a statement of change that complies with the requirements of 119 1 subsection 1 and recites that the corporation has been 119 2 notified of the change. 119 3 3. If a registered agent changes the registered agent's 119 4 business address to another place, the registered agent may 119 5 change the address of the registered office of any corporation 119 6 for which the registered agent is the registered agent by 119 7 filing a statement as required in subsection 2 for each 119 8 corporation, or by filing a single statement for all 119 9 corporations named in the notice, except that it must be 119 10 signed either manually or in facsimile only by the registered 119 11 agent and must recite that a copy of the statement has been 119 12 mailed to each corporation named in the notice. 119 13 4. A corporation may also change its registered office or 119 14 registered agent in its biennial report as provided in section 119 15 504A.1613. 119 16 Sec. 163. NEW SECTION. 504A.1509 RESIGNATION OF 119 17 REGISTERED AGENT OF FOREIGN CORPORATION. 119 18 1. The registered agent of a foreign corporation may 119 19 resign as agent by signing and delivering to the secretary of 119 20 state for filing the original statement of resignation. The 119 21 statement of resignation may include a statement that the 119 22 registered office is also discontinued. 119 23 The registered agent shall send a copy of the statement of 119 24 resignation by certified mail to the corporation at its 119 25 principal office and to the registered office, if not 119 26 discontinued. The registered agent shall certify to the 119 27 secretary of state that the copies have been sent to the 119 28 corporation, including the date the copies were sent. 119 29 2. The agency appointment is terminated, and the 119 30 registered office discontinued if so provided, on the date on 119 31 which the statement is filed with the secretary of state. 119 32 Sec. 164. NEW SECTION. 504A.1510 SERVICE ON FOREIGN 119 33 CORPORATION. 119 34 1. The registered agent of a foreign corporation 119 35 authorized to transact business in this state is the 120 1 corporation's agent for service of process, notice, or demand 120 2 required or permitted by law to be served on the foreign 120 3 corporation. 120 4 2. A foreign corporation may be served by registered or 120 5 certified mail, return receipt requested, addressed to the 120 6 secretary of the foreign corporation at its principal office 120 7 shown in its application for a certificate of authority or in 120 8 its most recent biennial report filed under section 504A.1613 120 9 if any of the following conditions apply: 120 10 a. The foreign corporation has no registered agent or its 120 11 registered agent cannot with reasonable diligence be served. 120 12 b. The foreign corporation has withdrawn from transacting 120 13 business in this state under section 504A.1521. 120 14 c. The foreign corporation has had its certificate of 120 15 authority revoked under section 504A.1532. 120 16 3. Service is perfected under subsection 2 at the earliest 120 17 of any of the following: 120 18 a. The date the foreign corporation receives the mail. 120 19 b. The date shown on the return receipt, if signed on 120 20 behalf of the foreign corporation. 120 21 c. Five days after its deposit in the United States mail, 120 22 as evidenced by the postmark, if mailed postpaid and correctly 120 23 addressed. 120 24 4. This section does not prescribe the only means, or 120 25 necessarily the required means, of serving a foreign 120 26 corporation. A foreign corporation may also be served in any 120 27 other manner permitted by law. 120 28 PART 2 120 29 WITHDRAWAL 120 30 Sec. 165. NEW SECTION. 504A.1521 WITHDRAWAL OF FOREIGN 120 31 CORPORATION. 120 32 1. A foreign corporation authorized to transact business 120 33 in this state shall not withdraw from this state until it 120 34 obtains a certificate of withdrawal from the secretary of 120 35 state. 121 1 2. A foreign corporation authorized to transact business 121 2 in this state may apply for a certificate of withdrawal by 121 3 delivering an application to the secretary of state for 121 4 filing. The application shall set forth all of the following: 121 5 a. The name of the foreign corporation and the name of the 121 6 state or country under whose law it is incorporated. 121 7 b. That it is not transacting business in this state and 121 8 that it surrenders its authority to transact business in this 121 9 state. 121 10 c. That it revokes the authority of its registered agent 121 11 to accept service on its behalf and appoints the secretary of 121 12 state as its agent for service of process in any proceeding 121 13 based on a cause of action arising during the time it was 121 14 authorized to do business in this state. 121 15 d. A mailing address to which the secretary of state may 121 16 mail a copy of any process served on the secretary of state 121 17 under paragraph "c". 121 18 3. After the withdrawal of the corporation is effective, 121 19 service of process on the secretary of state under this 121 20 section is service on the foreign corporation. Upon receipt 121 21 of process, the secretary of state shall mail a copy of the 121 22 process to the foreign corporation at the mailing address set 121 23 forth in its application for withdrawal. 121 24 PART 3 121 25 REVOCATION OF CERTIFICATE OF AUTHORITY 121 26 Sec. 166. NEW SECTION. 504A.1531 GROUNDS FOR REVOCATION. 121 27 1. The secretary of state may commence a proceeding under 121 28 section 504A.1532 to revoke the certificate of authority of a 121 29 foreign corporation authorized to transact business in this 121 30 state if any of the following applies: 121 31 a. The foreign corporation does not deliver the biennial 121 32 report to the secretary of state in a form that meets the 121 33 requirements of section 504A.1613 within sixty days after it 121 34 is due. 121 35 b. The foreign corporation is without a registered agent 122 1 or registered office in this state for sixty days or more. 122 2 c. The foreign corporation does not inform the secretary 122 3 of state under section 504A.1508 or 504A.1509 that its 122 4 registered agent or registered office has changed, that its 122 5 registered agent has resigned, or that its registered office 122 6 has been discontinued within ninety days of the change, 122 7 resignation, or discontinuance. 122 8 d. An incorporator, director, officer, or agent of the 122 9 foreign corporation signed a document that such person knew 122 10 was false in any material respect with intent that the 122 11 document be delivered to the secretary of state for filing. 122 12 e. The secretary of state receives a duly authenticated 122 13 certificate from the secretary of state or other official 122 14 having custody of corporate records in the state or country 122 15 under whose law the foreign corporation is incorporated, 122 16 stating that it has been dissolved or disappeared as the 122 17 result of a merger. 122 18 2. The attorney general may commence a proceeding under 122 19 section 504A.1532 to revoke the certificate of authority of a 122 20 foreign corporation authorized to transact business in this 122 21 state if any of the following applies: 122 22 a. The corporation has continued to exceed or abuse the 122 23 authority conferred upon it by law. 122 24 b. The corporation would have been a public benefit 122 25 corporation had it been incorporated in this state and its 122 26 corporate assets in this state are being misapplied or wasted. 122 27 c. The corporation would have been a public benefit 122 28 corporation had it been incorporated in this state and it is 122 29 no longer able to carry out its purposes. 122 30 Sec. 167. NEW SECTION. 504A.1532 PROCEDURE FOR AND 122 31 EFFECT OF REVOCATION. 122 32 1. The secretary of state, upon determining that one or 122 33 more grounds exist under section 504A.1531 for revocation of a 122 34 certificate of authority, shall serve the foreign corporation 122 35 with written notice of that determination under section 123 1 504A.1510. 123 2 2. The attorney general, upon determining that one or more 123 3 grounds exist under section 504A.1531, subsection 2, for 123 4 revocation of a certificate of authority, shall request the 123 5 secretary of state to serve, and the secretary of state shall 123 6 serve, the foreign corporation with written notice of that 123 7 determination under section 504A.1510. 123 8 3. If the foreign corporation does not correct each ground 123 9 for revocation or demonstrate to the reasonable satisfaction 123 10 of the secretary of state or attorney general that each ground 123 11 for revocation determined by the secretary of state or 123 12 attorney general does not exist within sixty days after 123 13 service of the notice is perfected under section 504A.1510, 123 14 the secretary of state may revoke the foreign corporation's 123 15 certificate of authority by signing a certificate of 123 16 revocation that recites the ground or grounds for revocation 123 17 and its effective date. The secretary of state shall file the 123 18 original of the certificate and serve a copy on the foreign 123 19 corporation under section 504A.1510. 123 20 4. The authority of a foreign corporation to transact 123 21 business in this state ceases on the date shown on the 123 22 certificate revoking its certificate of authority. 123 23 5. The secretary of state's revocation of a foreign 123 24 corporation's certificate of authority appoints the secretary 123 25 of state the foreign corporation's agent for service of 123 26 process in any proceeding based on a cause of action that 123 27 arose during the time the foreign corporation was authorized 123 28 to transact business in this state. Service of process on the 123 29 secretary of state under this subsection is service on the 123 30 foreign corporation. Upon receipt of process, the secretary 123 31 of state shall mail a copy of the process to the secretary of 123 32 the foreign corporation at its principal office shown in its 123 33 most recent biennial report or in any subsequent 123 34 communications received from the corporation stating the 123 35 current mailing address of its principal office, or, if none 124 1 are on file, in its application for a certificate of 124 2 authority. 124 3 6. Revocation of a foreign corporation's certificate of 124 4 authority does not terminate the authority of the registered 124 5 agent of the corporation. 124 6 Sec. 168. NEW SECTION. 504A.1533 APPEAL FROM REVOCATION. 124 7 1. A foreign corporation may appeal the secretary of 124 8 state's revocation of its certificate of authority to the 124 9 district court within thirty days after the service of the 124 10 certificate of revocation is perfected under section 504A.1510 124 11 by petitioning to set aside the revocation and attaching to 124 12 the petition copies of its certificate of authority and the 124 13 secretary of state's certificate of revocation. 124 14 2. The court may summarily order the secretary of state to 124 15 reinstate the certificate of authority or may take any other 124 16 action the court considers appropriate. 124 17 3. The court's final decision may be appealed as in other 124 18 civil proceedings. 124 19 SUBCHAPTER XVI 124 20 RECORDS AND REPORTS 124 21 PART 1 124 22 RECORDS 124 23 Sec. 169. NEW SECTION. 504A.1601 CORPORATE RECORDS. 124 24 1. A corporation shall keep as permanent records minutes 124 25 of all meetings of its members and board of directors, a 124 26 record of all actions taken by the members or directors 124 27 without a meeting, and a record of all actions taken by 124 28 committees of the board of directors as authorized by section 124 29 504A.826, subsection 4. 124 30 2. A corporation shall maintain appropriate accounting 124 31 records. 124 32 3. A corporation or its agent shall maintain a record of 124 33 its members in a form that permits preparation of a list of 124 34 the names and addresses of all members, in alphabetical order 124 35 by class, showing the number of votes each member is entitled 125 1 to vote. 125 2 4. A corporation shall maintain its records in written 125 3 form or in another form capable of conversion into written 125 4 form within a reasonable time. 125 5 5. A corporation shall keep a copy of all of the following 125 6 records: 125 7 a. Its articles or restated articles of incorporation and 125 8 all amendments to them currently in effect. 125 9 b. Its bylaws or restated bylaws and all amendments to 125 10 them currently in effect. 125 11 c. Resolutions adopted by its board of directors relating 125 12 to the characteristics, qualifications, rights, limitations, 125 13 and obligations of members or any class or category of 125 14 members. 125 15 d. The minutes of all meetings of members and records of 125 16 all actions approved by the members for the past three years. 125 17 e. All written communications to members generally within 125 18 the past three years, including the financial statements 125 19 furnished for the past three years under section 504A.1611. 125 20 f. A list of the names and business or home addresses of 125 21 its current directors and officers. 125 22 g. Its most recent biennial report delivered to the 125 23 secretary of state under section 504A.1613. 125 24 Sec. 170. NEW SECTION. 504A.1602 INSPECTION OF RECORDS 125 25 BY MEMBERS. 125 26 1. Subject to subsection 5, a member is entitled to 125 27 inspect and copy, at a reasonable time and location specified 125 28 by the corporation, any of the records of the corporation 125 29 described in section 504A.1601, subsection 5, if the member 125 30 gives the corporation written notice or a written demand at 125 31 least five business days before the date on which the member 125 32 wishes to inspect and copy. 125 33 2. Subject to subsection 5, a member is entitled to 125 34 inspect and copy, at a reasonable time and reasonable location 125 35 specified by the corporation, any of the following records of 126 1 the corporation if the member meets the requirements of 126 2 subsection 3 and gives the corporation written notice at least 126 3 five business days before the date on which the member wishes 126 4 to inspect and copy: 126 5 a. Excerpts from any records required to be maintained 126 6 under section 504A.1601, subsection 1, to the extent not 126 7 subject to inspection under section 504A.1602, subsection 1. 126 8 b. Accounting records of the corporation. 126 9 c. The membership list. 126 10 3. A member may inspect and copy the records identified in 126 11 subsection 2 only if all of the following apply: 126 12 a. The member's demand is made in good faith and for a 126 13 proper purpose. 126 14 b. The member describes with reasonable particularity the 126 15 purpose of the demand and the records the member desires to 126 16 inspect. 126 17 c. The records are directly connected to the purpose 126 18 described. 126 19 d. The board consents, if consent is required by section 126 20 504A.1605. 126 21 4. This section does not affect either of the following: 126 22 a. The right of a member to inspect records under section 126 23 504A.711 or, if the member is in litigation with the 126 24 corporation, to the same extent as any other litigant. 126 25 b. The power of a court, independently of this chapter, to 126 26 compel the production of corporate records for examination. 126 27 5. The articles or bylaws of a religious corporation may 126 28 limit or abolish the right of a member under this section to 126 29 inspect and copy any corporate record. 126 30 Sec. 171. NEW SECTION. 504A.1603 SCOPE OF INSPECTION 126 31 RIGHT. 126 32 1. A member's agent or attorney has the same inspection 126 33 and copying rights as the member the agent or attorney 126 34 represents. 126 35 2. The right to copy records under section 504A.1602 127 1 includes, if reasonable, the right to receive copies made by 127 2 photographic, xerographic, or other means. 127 3 3. The corporation may impose a reasonable charge, 127 4 covering the costs of labor and material, for copies of any 127 5 documents provided to the member. The charge shall not exceed 127 6 the estimated cost of production or reproduction of the 127 7 records. 127 8 4. The corporation may comply with a member's demand to 127 9 inspect the record of members under section 504A.1602, 127 10 subsection 2, paragraph "c", by providing the member with a 127 11 list of its members that was compiled no earlier than the date 127 12 of the member's demand. 127 13 Sec. 172. NEW SECTION. 504A.1604 COURT-ORDERED 127 14 INSPECTION. 127 15 1. If a corporation does not allow a member who complies 127 16 with section 504A.1602, subsection 1, to inspect and copy any 127 17 records required by that subsection to be available for 127 18 inspection, the district court in the county where the 127 19 corporation's principal office is located or, if none is 127 20 located in this state, where its registered office is located, 127 21 may summarily order inspection and copying of the records 127 22 demanded at the corporation's expense upon application of the 127 23 member. 127 24 2. If a corporation does not within a reasonable time 127 25 allow a member to inspect and copy any other records, the 127 26 member who complies with section 504A.1602, subsections 2 and 127 27 3, may apply to the district court in the county where the 127 28 corporation's principal office is located or, if none is 127 29 located in this state, where its registered office is located, 127 30 for an order to permit inspection and copying of the records 127 31 demanded. The court shall dispose of an application under 127 32 this subsection on an expedited basis. 127 33 3. If the court orders inspection and copying of the 127 34 records demanded, it shall also order the corporation to pay 127 35 the member's costs, including reasonable attorney fees 128 1 incurred, to obtain the order unless the corporation proves 128 2 that it refused inspection in good faith because it had a 128 3 reasonable basis for doubt about the right of the member to 128 4 inspect the records demanded. 128 5 4. If the court orders inspection and copying of the 128 6 records demanded, it may impose reasonable restrictions on the 128 7 use or distribution of the records by the demanding member. 128 8 Sec. 173. NEW SECTION. 504A.1605 LIMITATIONS ON USE OF 128 9 CORPORATE RECORDS. 128 10 Without consent of the board, no corporate record may be 128 11 obtained or used by any person for any purpose unrelated to a 128 12 member's interest as a member. Without limiting the 128 13 generality of the foregoing, without the consent of the board, 128 14 corporate records including, without limitation, a membership 128 15 list or any part thereof, shall not be used for any of the 128 16 following: 128 17 1. To solicit money or property unless such money or 128 18 property will be used solely to solicit the votes of the 128 19 members in an election to be held by the corporation. 128 20 2. For any commercial purpose. 128 21 3. For sale to or purchase by any person. 128 22 4. For any purpose that is detrimental to the interests of 128 23 the corporation. 128 24 Sec. 174. NEW SECTION. 504A.1606 INSPECTION OF RECORDS 128 25 BY DIRECTORS. 128 26 1. A director of a corporation is entitled to inspect and 128 27 copy the books, records, and documents of the corporation at 128 28 any reasonable time to the extent reasonably related to the 128 29 performance of the director's duties as a director, including 128 30 duties as a member of a committee, but not for any other 128 31 purpose or in any manner that would violate any duty to the 128 32 corporation. 128 33 2. The district court of the county where the 128 34 corporation's principal office, or if none in this state, its 128 35 registered office, is located may order inspection and copying 129 1 of the books, records, and documents at the corporation's 129 2 expense, upon application of a director who has been refused 129 3 such inspection rights, unless the corporation establishes 129 4 that the director is not entitled to such inspection rights. 129 5 The court shall dispose of an application under this 129 6 subsection on an expedited basis. 129 7 3. If an order is issued, the court may include provisions 129 8 protecting the corporation from undue burden or expense, and 129 9 prohibiting the director from using information obtained upon 129 10 exercise of the inspection rights in a manner that would 129 11 violate a duty to the corporation, and may also order the 129 12 corporation to reimburse the director for the director's 129 13 costs, including reasonable counsel fees, incurred in 129 14 connection with the application. 129 15 PART 2 129 16 REPORTS 129 17 Sec. 175. NEW SECTION. 504A.1611 FINANCIAL STATEMENTS 129 18 FOR MEMBERS. 129 19 1. Except as provided in the articles or bylaws of a 129 20 religious corporation, a corporation upon written demand from 129 21 a member shall furnish that member the corporation's latest 129 22 annual financial statements, which may be consolidated or 129 23 combined statements of the corporation and one or more of its 129 24 subsidiaries or affiliates, as appropriate, that include a 129 25 balance sheet as of the end of the fiscal year and a statement 129 26 of operations for that year. 129 27 2. If annual financial statements are reported upon by a 129 28 public accountant, the accountant's report must accompany 129 29 them. 129 30 Sec. 176. NEW SECTION. 504A.1612 REPORT OF 129 31 INDEMNIFICATION TO MEMBERS. 129 32 If a corporation indemnifies or advances expenses to a 129 33 director under section 504A.852, 504A.853, 504A.854, or 129 34 504A.855 in connection with a proceeding by or in the right of 129 35 the corporation, the corporation shall report the 130 1 indemnification or advance in writing to the members with or 130 2 before the notice of the next meeting of members. 130 3 Sec. 177. NEW SECTION. 504A.1613 BIENNIAL REPORT FOR 130 4 SECRETARY OF STATE. 130 5 1. Each domestic corporation, and each foreign corporation 130 6 authorized to transact business in this state, shall deliver 130 7 to the secretary of state for filing a biennial report on a 130 8 form prescribed and furnished by the secretary of state that 130 9 sets forth all of the following: 130 10 a. The name of the corporation and the state or country 130 11 under whose law it is incorporated. 130 12 b. The address of the corporation's registered office and 130 13 the name of the corporation's registered agent at that office 130 14 in this state, together with the consent of any new registered 130 15 agent. 130 16 c. The address of the corporation's principal office. 130 17 d. The names and addresses of the president, secretary, 130 18 treasurer, and one member of the board of directors. 130 19 e. A brief description of the nature of the corporation's 130 20 activities. 130 21 f. Whether or not the corporation has members. 130 22 g. If the corporation is a domestic corporation, whether 130 23 the corporation is a public benefit, mutual benefit, or 130 24 religious corporation. 130 25 h. If the corporation is a foreign corporation, whether 130 26 the corporation would be a public benefit, mutual benefit, or 130 27 religious corporation had the corporation been incorporated in 130 28 this state. 130 29 2. The information in the biennial report must be current 130 30 on the date the biennial report is executed on behalf of the 130 31 corporation. 130 32 3. The first biennial report shall be delivered to the 130 33 secretary of state between January 1 and April 1 of the first 130 34 odd-numbered year following the calendar year in which a 130 35 domestic corporation was incorporated or a foreign corporation 131 1 was authorized to transact business. Subsequent biennial 131 2 reports must be delivered to the secretary of state between 131 3 January 1 and April 1 of the following odd-numbered calendar 131 4 years. 131 5 4. a. If a biennial report does not contain the 131 6 information required by this section, the secretary of state 131 7 shall promptly notify the reporting domestic or foreign 131 8 corporation in writing and return the report to the 131 9 corporation for correction. 131 10 b. A filing fee for the biennial report shall be 131 11 determined by the secretary of state. 131 12 c. For purposes of this section, each biennial report 131 13 shall contain information related to the two-year period 131 14 immediately preceding the calendar year in which the report is 131 15 filed. 131 16 5. The secretary of state may provide for the change of 131 17 registered office or registered agent on the form prescribed 131 18 by the secretary of state for the biennial report, provided 131 19 that the form contains the information required in section 131 20 504A.502 or 504A.508. If the secretary of state determines 131 21 that a biennial report does not contain the information 131 22 required by this section but otherwise meets the requirements 131 23 of section 504A.502 or 504A.508 for the purpose of changing 131 24 the registered office or registered agent, the secretary of 131 25 state shall file the statement of change of registered office 131 26 or registered agent, effective as provided in section 131 27 504A.114, before returning the biennial report to the 131 28 corporation as provided in this section. A statement of 131 29 change of registered office or agent pursuant to this 131 30 subsection shall be executed by a person authorized to execute 131 31 the biennial report. 131 32 SUBCHAPTER XVII 131 33 TRANSITION PROVISIONS 131 34 Sec. 178. NEW SECTION. 504A.1701 APPLICATION TO EXISTING 131 35 DOMESTIC CORPORATIONS. 132 1 A domestic corporation in existence on April 1, 2005, that 132 2 was incorporated under the statutes of this state as they 132 3 existed prior to July 1, 2004, is subject to this chapter on 132 4 and after April 1, 2005. 132 5 Sec. 179. NEW SECTION. 504A.1702 APPLICATION TO 132 6 QUALIFIED FOREIGN CORPORATIONS. 132 7 A foreign corporation authorized to transact business in 132 8 this state on the effective date of this Act is subject to 132 9 this chapter, but is not required to obtain a new certificate 132 10 of authority to transact business under this chapter. 132 11 Sec. 180. NEW SECTION. 504A.1703 SAVINGS PROVISIONS. 132 12 1. Except as provided in subsection 2, the repeal of a 132 13 statute by this Act does not affect any of the following: 132 14 a. The operation of the statute or any action taken under 132 15 it before its repeal. 132 16 b. Any ratification, right, remedy, privilege, obligation, 132 17 or liability acquired, accrued, or incurred under the statute 132 18 before its repeal. 132 19 c. Any violation of the statute or any penalty, 132 20 forfeiture, or punishment incurred because of the violation, 132 21 before its repeal. 132 22 d. Any proceeding, reorganization, or dissolution 132 23 commenced under the statute before its repeal, and the 132 24 proceeding, reorganization, or dissolution may be completed in 132 25 accordance with the statute as if it had not been repealed. 132 26 2. If a penalty or punishment imposed for violation of a 132 27 statute repealed by this Act is reduced by this chapter, the 132 28 penalty or punishment, if not already imposed, shall be 132 29 imposed in accordance with this chapter. 132 30 Sec. 181. NEW SECTION. 504A.1704 SEVERABILITY. 132 31 If any provision of this chapter or its application to any 132 32 person or circumstance is held invalid by a court of competent 132 33 jurisdiction, the invalidity does not affect other provisions 132 34 or applications of the chapter that can be given effect 132 35 without the invalid provision or application, and to this end 133 1 the provisions of the chapter are severable. 133 2 Sec. 182. NEW SECTION. 504A.1705 PUBLIC BENEFIT, MUTUAL 133 3 BENEFIT, AND RELIGIOUS CORPORATIONS. 133 4 On April 1, 2005, each domestic corporation existing on 133 5 April 1, 2005, that is or becomes subject to this chapter as 133 6 provided in section 504A.1701, shall be designated as a public 133 7 benefit, mutual benefit, or religious corporation as follows: 133 8 1. A corporation designated by statute as a public benefit 133 9 corporation, a mutual benefit corporation, or a religious 133 10 corporation is deemed to be the type of corporation designated 133 11 by that statute. 133 12 2. A corporation that does not come within subsection 1 133 13 but is organized primarily or exclusively for religious 133 14 purposes is a religious corporation. 133 15 3. A corporation that does not come within subsection 1 or 133 16 2 but which is recognized as exempt under section 501(c)(3) of 133 17 the Internal Revenue Code, or any successor section, is a 133 18 public benefit corporation. 133 19 4. A corporation that does not come within subsection 1, 133 20 2, or 3, but which is organized for a public or charitable 133 21 purpose and which upon dissolution must distribute its assets 133 22 to a public benefit corporation, the United States, a state, 133 23 or a person recognized as exempt under section 501(c)(3) of 133 24 the Internal Revenue Code, or any successor section, is a 133 25 public benefit corporation. 133 26 5. A corporation that does not come within subsection 1, 133 27 2, 3, or 4 is a mutual benefit corporation. 133 28 Sec. 183. Section 15E.64, subsection 2, unnumbered 133 29 paragraph 1, Code 2003, is amended to read as follows: 133 30 To facilitate the organization of an Iowa capital 133 31 investment corporation, both of the following persons shall 133 32 serve as incorporators as provided in section504A.28133 33 504A.201: 133 34 Sec. 184. Section 230A.12, unnumbered paragraph 1, Code 133 35 2003, is amended to read as follows: 134 1 Each community mental health center established or 134 2 continued in operation pursuant to section 230A.3, shall be 134 3 organized underthe Iowa nonprofit corporation Act appearing134 4aschapter 504A, except that a community mental health center 134 5 organized under chapter 504 prior to July 1, 1974, shall not 134 6 be required by this chapter to adopt the Iowa nonprofit 134 7 corporation Act if it is not otherwise required to do so by 134 8 law. The board of directors of each such community mental 134 9 health center shall enter into an agreement with the county or 134 10 affiliated counties which are to be served by the center, 134 11 which agreement shall include but need not be limited to the 134 12 period of time for which the agreement is to be in force, what 134 13 services the center is to provide for residents of the county 134 14 or counties to be served, standards the center is to follow in 134 15 determining whether and to what extent persons seeking 134 16 services from the center shall be considered able to pay the 134 17 cost of the services received, and policies regarding 134 18 availability of the center's services to persons who are not 134 19 residents of the county or counties served by the center. The 134 20 board of directors, in addition to exercising the powers of 134 21 the board of directors of a nonprofit corporation may: 134 22 Sec. 185. Section 490.401, subsection 2, paragraph b, Code 134 23 2003, is amended to read as follows: 134 24 b. A corporate name reserved or registered under section 134 25 490.402, 490.403, or504A.7504A.402. 134 26 Sec. 186. Section 497.22, unnumbered paragraph 1, Code 134 27 2003, is amended to read as follows: 134 28Sections 504A.83 and 504A.84 applySection 504A.1613 134 29 applies to a cooperative association organized under this 134 30 chapter in the same manner asthose sections applythat 134 31 section applies to a corporation organized under chapter 504A. 134 32 In addition to the information required to be set forth in the 134 33 biennial report under section504A.83504A.1613, the 134 34 cooperative association shall also set forth the total amount 134 35 of business transacted, number of members, total expense of 135 1 operation, total amount of indebtedness, and total profits or 135 2 losses for each calendar or fiscal year of the two-year period 135 3 which ended immediately preceding the first day of January of 135 4 the year in which the report is filed. 135 5 Sec. 187. Section 498.24, unnumbered paragraph 1, Code 135 6 2003, is amended to read as follows: 135 7Sections 504A.83 and 504A.84 applySection 504A.1613 135 8 applies to a cooperative association organized under this 135 9 chapter in the same manner asthose sections applythat 135 10 section applies to a corporation organized under chapter 504A. 135 11 In addition to the information required to be set forth in the 135 12 biennial report under section504A.83504A.1613, the 135 13 cooperative association shall also set forth the total amount 135 14 of business transacted, number of members, total expense of 135 15 operation, total amount of indebtedness, and total profits or 135 16 losses for each calendar or fiscal year of the two-year period 135 17 which ended immediately preceding the first day of January of 135 18 the year in which the report is filed. 135 19 Sec. 188. Section 499.49, Code 2003, is amended to read as 135 20 follows: 135 21 499.49 BIENNIAL REPORT. 135 22Sections 504A.83 and 504A.84 applySection 504A.1613 135 23 applies to a cooperative organized under this chapter in the 135 24 same manner asthose sections applythat section applies to a 135 25 corporation organized under chapter 504A. In addition to the 135 26 information required to be set forth in the biennial report 135 27 under section504A.83504A.1613, the cooperative shall also 135 28 set forth the number of members of the cooperative, the 135 29 percentage of the cooperative's business done with or for its 135 30 own members during each of the fiscal or calendar years of the 135 31 preceding two-year period, the percentage of the cooperative's 135 32 business done with or for each class of nonmembers specified 135 33 in section 499.3, and any other information deemed necessary 135 34 by the secretary of state to advise the secretary whether the 135 35 cooperative is actually functioning as a cooperative. 136 1 Sec. 189. Section 504A.102, subsection 2, paragraphs a and 136 2 b, Code 2003, are amended to read as follows: 136 3 a. The adoption of a resolution or resolutions at a 136 4 meeting of the board of directors upon receiving the vote of a 136 5 majority of the directors in office and of the members of the 136 6 association in the same manner as provided in section504A.35136 7 504A.1003. The resolution or resolutions shall recite that 136 8 the association voluntarily elects to be governed as a 136 9 corporation under this chapter. The resolution must designate 136 10 the address of the association's initial registered office and 136 11 the name of the association's registered agent or agents at 136 12 that office, if any. 136 13 b. The adoption of articles of incorporation in compliance 136 14 with section504A.29504A.202 at a meeting of the board of 136 15 directors upon receiving the vote of a majority of the 136 16 directors in office and of the members of the association in 136 17 the same manner as provided in section504A.35504A.1003. The 136 18 articles of incorporation may be a restatement, substitution, 136 19 or amendment of articles of incorporation adopted by the 136 20 association pursuant to section 176.3. The articles of 136 21 incorporation may be made part of the resolution or 136 22 resolutions adopted by the association pursuant to paragraph 136 23 "a" of this subsection. 136 24 Sec. 190. Section 504A.102, subsection 2, paragraph c, 136 25 subparagraphs (1) and (3), Code 2003, are amended to read as 136 26 follows: 136 27 (1) The association name as provided in the association's 136 28 articles of incorporation pursuant to section 176.3 and the 136 29 new corporation's corporate name, if different, as provided in 136 30 section504A.6504A.401. 136 31 (3) The address of the new corporation's registered office 136 32 and the name of the new corporation's registered agent as 136 33 provided in section504A.8504A.501. 136 34 Sec. 191. Section 504A.102, subsection 2, paragraph d, 136 35 unnumbered paragraph 1, Code 2003, is amended to read as 137 1 follows: 137 2 All of the following shall be delivered to the office of 137 3 the secretary of state for filing and recording as provided in 137 4 section504A.30504A.111: 137 5 Sec. 192. Section 504A.102, subsection 3, Code 2003, is 137 6 amended by striking the subsection and inserting in lieu 137 7 thereof the following: 137 8 3. CERTIFICATE OF INCORPORATION. Unless a delayed 137 9 effective date is specified, the corporate existence begins 137 10 when the articles of incorporation are filed as provided in 137 11 section 504A.203. 137 12 Sec. 193. Section 504A.102, subsection 4, Code 2003, is 137 13 amended to read as follows: 137 14 4. LIABILITIES AND RIGHTS PRIOR TO THE ELECTION. An 137 15 association's election to be governed as a corporation under 137 16 this chapter does not affect any right accrued or established, 137 17 or any liability or penalty incurred, under the provisions of 137 18 chapter 176, prior to filing of the resolution or resolutions, 137 19 articles of incorporation, and instrument of verification by 137 20 the association as provided insubsection 2this chapter. 137 21 Sec. 194. Section 504A.102, subsection 5, Code 2003, is 137 22 amended to read as follows: 137 23 5. REPEAL.This section isSubsections 1, 2, and 3 of 137 24 this section are repealed on July 1, 2005. 137 25 Sec. 195. Section 534.501, subsection 4, Code 2003, is 137 26 amended to read as follows: 137 27 4. AMENDMENT PROCEDURE. The procedure for amending 137 28 articles of incorporation or adopting restated articles for 137 29 mutual associations is that specified insection 504A.35137 30 chapter 504A, subchapter 10, and for stock associations it is 137 31 that specified in section 490.726 and sections 490.1002 137 32 through 490.1005. 137 33 Sec. 196. Section 602.8102, subsection 70, Code 2003, is 137 34 amended to read as follows: 137 35 70. Certify a copy of a decree of dissolution of a 138 1 nonprofit corporation to the secretary of state and the 138 2 recorder in the county in which the corporation is located as 138 3 provided in section504A.62504A.1434. 138 4 Sec. 197. Sections 504A.1 through 504A.101, Code 2003, are 138 5 repealed. 138 6 Sec. 198. EFFECTIVE DATE. This Act takes effect July 1, 138 7 2004. 138 8 EXPLANATION 138 9 This bill repeals Code sections 504A.1 through 504A.101, 138 10 relating to nonprofit corporations, and replaces them with the 138 11 revised model nonprofit corporation Act. 138 12 Subchapter I provides for filing requirements, forms 138 13 prescribed and furnished by the secretary of state, filing, 138 14 service, and copying fees, the effective date of filed 138 15 documents, correcting filed documents, the filing duty of the 138 16 secretary of state, the procedure for appealing from the 138 17 secretary of state's refusal to file a document, evidentiary 138 18 effect of a copy of a filed document, a certificate of 138 19 existence, a penalty for signing a false document, powers of 138 20 the secretary of state, notice requirements, judicial relief, 138 21 the role of the attorney general, and religious corporations. 138 22 Subchapter II provides for incorporators of a nonprofit 138 23 corporation, articles of incorporation, incorporation, 138 24 liability for preincorporation transactions, organization of a 138 25 nonprofit corporation, bylaws, and emergency bylaws and 138 26 powers. 138 27 Subchapter III provides for the general powers of a 138 28 nonprofit corporation, emergency powers of a nonprofit 138 29 corporation, and ultra vires. 138 30 Subchapter IV provides for corporate names, reserved names, 138 31 and registered names. 138 32 Subchapter V provides for registered offices and registered 138 33 agents of the corporation, the method of changing a registered 138 34 office or registered agent, resignation of registered agents, 138 35 and the method of service on the nonprofit corporation. 139 1 Subchapter VI provides for the admission of members, 139 2 consideration for admission, member requirements, differences 139 3 in rights and obligations of members, transfer of memberships, 139 4 a member's liability to third parties, a member's liability 139 5 for dues, assessments, and fees, a creditor's action against 139 6 members, resignation of members, termination, expulsion, or 139 7 suspension of members, purchase of memberships, derivative 139 8 suits, and delegates having some or all of the authority of 139 9 members. 139 10 Subchapter VII provides for annual and regular meetings, 139 11 special meetings, court-ordered meetings, action by written 139 12 consent, notice of meetings, waiver of notice, record dates, 139 13 determination of members entitled to notice and vote, action 139 14 by written ballot, a members' list for a meeting, voting 139 15 entitlement generally, quorum requirements, voting 139 16 requirements, proxies, cumulative voting for directors, other 139 17 methods of electing directors, a corporation's acceptance of 139 18 votes, and voting agreements. 139 19 Subchapter VIII provides for requirements for and duties of 139 20 the board of directors, qualifications of directors, number of 139 21 directors, election, designation, and appointment of 139 22 directors, terms of directors, staggered terms for directors, 139 23 resignation of directors, removal of directors elected by 139 24 members or directors, removal of designated or appointed 139 25 directors, removal of directors by judicial proceeding, 139 26 vacancy on the board of directors, compensation of directors, 139 27 regular and special meetings of the board, action without a 139 28 meeting of the board, call and notice of a meeting of the 139 29 board, waiver of notice of a meeting of the board, quorum and 139 30 voting at a meeting of the board, committees of the board, 139 31 general standards for directors, director conflicts of 139 32 interest, loans to or guarantees for directors and officers, 139 33 liability for unlawful distributions, required officers, 139 34 duties and authority of officers, standards of conduct for 139 35 officers, resignation and removal of officers, contract rights 140 1 of officers, officers' authority to execute documents, 140 2 authority of a nonprofit corporation to indemnify, mandatory 140 3 indemnification, advances for expenses of a director, court- 140 4 ordered indemnification, determination and authorization of 140 5 indemnification, indemnification of officers, employees, and 140 6 agents of the nonprofit corporation, and insurance purchased 140 7 and maintained by the nonprofit corporation. 140 8 Subchapter IX provides for personal liability and 140 9 limitations to the personal liability of a director, officer, 140 10 member, or volunteer of a nonprofit corporation. 140 11 Subchapter X provides for the authority to amend articles 140 12 of incorporation, amendment of the articles of incorporation 140 13 by the directors, amendment of the articles of incorporation 140 14 by directors and members, class voting by members on 140 15 amendments of the articles of incorporation, articles of 140 16 amendment, restated articles of incorporation, amendments of 140 17 the articles of incorporation pursuant to judicial 140 18 reorganization, effect of amendment and restatement, amendment 140 19 of the bylaws by directors, amendment of the bylaws by 140 20 directors and members, class voting by members on amendments 140 21 of the bylaws, approval of amendments of the bylaws and 140 22 articles of incorporation by third persons, and amendments 140 23 terminating members or redeeming or canceling memberships. 140 24 Subchapter XI provides for the approval of a plan of 140 25 merger, limitations on mergers by public benefit or religious 140 26 corporations, action on a merger plan by the board of 140 27 directors, members, and third persons, articles of merger, 140 28 effects of a merger, merger with a foreign corporation, and 140 29 bequests, devises, and gifts to a corporation involved in a 140 30 merger. 140 31 Subchapter XII provides for the sale of assets in the 140 32 regular course of activities and mortgage of assets and the 140 33 sale of assets other than in the regular course of activities 140 34 by nonprofit corporations. 140 35 Subchapter XIII provides for prohibited distributions and 141 1 authorized distributions by nonprofit corporations. 141 2 Subchapter XIV provides for dissolution by incorporators or 141 3 directors and third persons, dissolution by directors, 141 4 members, and third persons, notices to the attorney general, 141 5 articles of dissolution, revocation of dissolution, effects of 141 6 dissolution, known claims against a dissolved corporation, 141 7 unknown claims against a dissolved corporation, grounds for 141 8 administrative dissolution, procedure for and effect of 141 9 administrative dissolution, reinstatement following 141 10 administrative dissolution, appeal from denial of 141 11 reinstatement, grounds for judicial dissolution, procedure for 141 12 judicial dissolution, receivership or custodianship, decrees 141 13 of dissolution, and depositing assets with the treasurer of 141 14 state. 141 15 Subchapter XV provides for requiring an authority to 141 16 transact business, consequences of transacting business 141 17 without authority, an application for a certificate of 141 18 authority, an amended certificate of authority, the corporate 141 19 name of a foreign corporation, the registered office and 141 20 registered agent of a foreign corporation, change of a 141 21 registered office of a registered agent of a foreign 141 22 corporation, the resignation of a registered agent of a 141 23 foreign corporation, service on a foreign corporation, the 141 24 withdrawal of a foreign corporation, grounds for revocation of 141 25 a certificate of authority, the procedure and effect of 141 26 revocation of a certificate of authority, and appeal from a 141 27 revocation of a certificate of authority. 141 28 Subchapter XVI provides for corporate records, the 141 29 inspection of corporate records by members, the scope of 141 30 inspection rights, court-ordered inspections, financial 141 31 statements of a corporation upon demand by members, and a 141 32 biennial report for the secretary of state. 141 33 Subchapter XVII provides for the application of new Code 141 34 chapter 504A to existing corporations and qualified foreign 141 35 corporations, savings provisions, severability, and the 142 1 designation of public benefit, mutual benefit, and religious 142 2 corporations. 142 3 The bill provides conforming amendments. 142 4 Code section 504A.102 relating to farm aid associations is 142 5 amended to provide that any liabilities or rights of a farm 142 6 aid association that exist prior to the association's election 142 7 to be governed as a corporation under chapter 504A continue 142 8 after the July 1, 2005, repeal of other transition provisions 142 9 relating to farm aid associations. 142 10 The bill takes effect July 1, 2004, and is applicable to 142 11 new corporations incorporated after that date. Corporations 142 12 in existence prior to July 1, 2004, are subject to the bill on 142 13 and after April 1, 2005. All corporations that are or become 142 14 subject to this bill on April 1, 2005, must be designated as a 142 15 public benefit, mutual benefit, or religious corporation on 142 16 April 1, 2005. 142 17 LSB 1151SV 80 142 18 av/cf/24
Text: SF00373 Text: SF00375 Text: SF00300 - SF00399 Text: SF Index Bills and Amendments: General Index Bill History: General Index
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