H.F. _____ Section 1. Section 491.19, Code 2014, is amended to read as 1 follows: 2 491.19 Commencement of business. 3 The corporation may commence business as soon as the 4 certificate is issued by articles of incorporation are filed 5 with the secretary of state , and its acts shall be valid if the 6 publication in a newspaper is made within three months from 7 the date of such certificate; providing that when the notice 8 is not published within the time herein prescribed, but is 9 subsequently published for the required time, and proof of the 10 publication thereof filed with the secretary of state, the acts 11 of such corporation after such publication shall be valid . 12 Sec. 2. Section 491.20, unnumbered paragraph 1, Code 2014, 13 is amended to read as follows: 14 Amendments to articles of incorporation making changes in 15 any of the provisions of the articles may be made at any annual 16 meeting of the stockholders or special meeting called for that 17 purpose, and they shall be valid only when recorded, approved 18 and published as the original articles are required to be, 19 except where the amendment provides for changing the principal 20 place of business from one county to another, in which event 21 said amendment shall be published in both the counties of the 22 former and new place of business by the shareholders and filed 23 with the secretary of state . Publication shall be by notice 24 setting out the substance of the amendment and, in the case of 25 amended and substituted articles, said notice shall contain the 26 matters and things required to be published by section 491.17 , 27 relating to original incorporations. If no increase is made in 28 the amount of capital stock, a certificate fee of one dollar 29 and a recording fee of fifty cents per page must be paid. Where 30 capital stock is increased the certificate fee shall be omitted 31 but there shall be paid a recording fee of fifty cents per page 32 and in addition a filing fee which in case of corporations 33 existing for a period of years shall be one dollar per thousand 34 of such increase and in case of corporations empowered to exist 35 -1- LSB 5770YC (6) 85 da/rj 1/ 4

H.F. _____ perpetually shall be one dollar and ten cents per thousand of 1 such increase. Corporations providing for perpetual existence 2 by amendment to its articles shall, at the time of filing 3 such amendment, pay to the secretary of state a fee of one 4 hundred dollars together with a recording fee of fifty cents 5 per page, and, for all authorized capital stock in excess of 6 ten thousand dollars, an additional fee of one dollar ten cents 7 per thousand. 8 Sec. 3. Section 491.23, Code 2014, is amended to read as 9 follows: 10 491.23 Dissolution —— notice —— filing a statement with 11 secretary of state. 12 A corporation may be dissolved prior to the period fixed 13 in the articles of incorporation, by unanimous consent, or in 14 accordance with the provisions of its articles, and notice 15 thereof must be given in the same manner and for the same time 16 as is required for its organization; provided, however, that 17 the notice of such dissolution shall be deemed sufficient if a 18 statement swearing to the dissolution, signed by the officers 19 of such corporation and published as required by law , is filed 20 with the secretary of state . Notice thereof shall also be 21 given by the filing in the office of the secretary of state the 22 proof of publication of notice of dissolution and said proof 23 shall be recorded by the secretary of state in the same manner 24 as the recording of amendments, and a A recording fee of one 25 dollar shall apply thereto to the filing of the statement . 26 Sec. 4. REPEAL. Sections 491.17, 491.18, 491.32, and 27 491.109, Code 2014, are repealed. 28 EXPLANATION 29 The inclusion of this explanation does not constitute agreement with 30 the explanation’s substance by the members of the general assembly. 31 BACKGROUND. Iowa’s modern for-profit corporation law is 32 contained in Code chapter 490 (1989 Iowa Acts, chapter 288), 33 the “Iowa Business Corporation Act” (Code section 490.101). 34 All domestic for-profit corporations must be organized under 35 -2- LSB 5770YC (6) 85 da/rj 2/ 4

H.F. _____ that chapter, unless an express exception is provided. One 1 exception involves a corporation organized under Code chapter 2 491 which governs corporations incorporated prior to July 1, 3 1971. That Code chapter expressly provides that all domestic 4 corporations are to be organized under Code chapter 490, unless 5 expressly allowed in that Code chapter. The transitional 6 provision in Code chapter 490 allows a corporation organized 7 under Code chapter 491 to remain governed under that Code 8 chapter, if organized on the mutual plan or operating as 9 a telephone company qualifying as a nonprofit corporation 10 pursuant to an internal revenue service letter ruling and if 11 it distributes profits in a manner similar to a cooperative 12 association under Code chapter 499. For example, certain 13 corporations formed for purposes of insurance may be governed 14 under Code chapter 490 (Code section 515.1). 15 CURRENT LAW —— PUBLICATION REQUIREMENTS. A corporation 16 organized under Code chapter 491 is governed by its articles of 17 incorporation filed with the secretary of state who issues a 18 certificate of incorporation to the corporation (Code section 19 491.19). The corporation must publish a detailed notice of 20 the incorporation in a newspaper (Code sections 491.17 through 21 491.19). In addition, when the corporation amends its articles 22 of incorporation, the amendments are valid only when filed with 23 the secretary of state and published in a newspaper in the same 24 manner required for the original corporation (Code section 25 491.20). A corporation organized under the Code chapter may 26 also have a limited duration (Code section 491.24) but can 27 be renewed (Code section 491.25). Upon satisfying certain 28 conditions, the secretary of state issues the corporation a 29 certificate of renewal (Code section 491.28). The corporation 30 must publish a notice of renewal in the same manner as it 31 published the notice of incorporation (Code section 491.32). 32 Two or more corporations organized under Code chapter 491 33 may merge so that the surviving corporation absorbs another 34 corporation or alternatively, two corporations may consolidate 35 -3- LSB 5770YC (6) 85 da/rj 3/ 4

H.F. _____ to form a new corporation (Code chapter 491, division II). The 1 merged or consolidated corporation must file articles of merger 2 or consolidation with the secretary of state (Code section 3 491.107). In that case, notice of the merger or consolidation 4 is again published in the same manner as the original articles 5 (Code section 491.109). A corporation organized under Code 6 chapter 491 that dissolves must publish a notice of the 7 dissolution and file a proof of publication with the secretary 8 of state (Code section 491.23). 9 BILL’S PROVISIONS. The bill provides that a corporation 10 organized under Code chapter 491 prior to July 1, 1971, and 11 which is allowed to continue its existence, may amend its 12 articles of incorporation, merge with another corporation, or 13 dissolve without having to publish a notice of its action in a 14 newspaper. 15 -4- LSB 5770YC (6) 85 da/rj 4/ 4