House File 844 - Introduced HOUSE FILE 844 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 681) (SUCCESSOR TO HSB 39) A BILL FOR An Act providing for business entities, providing for certain 1 fees, and including effective date provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 1234HZ (1) 89 da/jh
H.F. 844 DIVISION I 1 FOR PROFIT CORPORATIONS 2 PART A 3 GENERAL PROVISIONS 4 Section 1. Section 490.101, Code 2021, is amended by 5 striking the section and inserting in lieu thereof the 6 following: 7 490.101 Short title. 8 This chapter shall be known and may be cited as the “Iowa 9 Business Corporation Act” . 10 Sec. 2. Section 490.120, Code 2021, is amended by striking 11 the section and inserting in lieu thereof the following: 12 490.120 Requirements for documents —— extrinsic facts. 13 1. A document must satisfy the requirements of this 14 section, and of any other section that adds to or varies these 15 requirements, to be entitled to filing by the secretary of 16 state. 17 2. This chapter must require or permit filing the document 18 in the office of the secretary of state. 19 3. The document must contain the information required by 20 this chapter and may contain other information. 21 4. The document must be typewritten or printed or, if 22 electronically transmitted, it must be in a format that can be 23 retrieved or reproduced in typewritten or printed form. 24 5. The document must be in the English language. A 25 corporate name need not be in English if written in English 26 letters or Arabic or Roman numerals, and the certificate of 27 existence required of foreign corporations need not be in 28 English if accompanied by a reasonably authenticated English 29 translation. 30 6. Except as provided in section 490.1622, subsection 3, the 31 document must be signed by any of the following: 32 a. The chair of the board of directors of a domestic or 33 foreign corporation, its president, or another of its officers. 34 b. If directors have not been selected or the corporation 35 -1- LSB 1234HZ (1) 89 da/jh 1/ 267
H.F. 844 has not been formed, by an incorporator. 1 c. If the corporation is in the hands of a receiver, 2 trustee, or other court-appointed fiduciary, by that fiduciary. 3 7. a. The person executing the document shall sign it 4 and state beneath or opposite the person’s signature the 5 person’s name and the capacity in which the document is signed. 6 The document may but need not contain a corporate seal, 7 attestation, acknowledgment, or verification. 8 b. The secretary of state may accept for filing a document 9 containing a copy of a signature, however made. 10 8. If the secretary of state has prescribed a mandatory 11 form for the document under section 490.121, subsection 1, the 12 document must be in or on the prescribed form. 13 9. The document must be delivered to the office of the 14 secretary of state for filing. Delivery may be made by 15 electronic transmission if and to the extent permitted by the 16 secretary of state. If it is filed in typewritten or printed 17 form and not transmitted electronically, the secretary of state 18 may require one exact or conformed copy to be delivered with 19 the document. 20 10. When the document is delivered to the office of the 21 secretary of state for filing, the correct filing fee, and any 22 franchise tax, license fee, or penalty required by this chapter 23 or other law to be paid at the time of delivery for filing must 24 be paid or provision for payment made in a manner permitted by 25 the secretary of state. 26 11. Whenever a provision of this chapter permits any of the 27 terms of a plan or a filed document to be dependent on facts 28 objectively ascertainable outside the plan or filed document, 29 all of the following provisions apply: 30 a. The manner in which the facts will operate upon the terms 31 of the plan or filed document must be set forth in the plan or 32 filed document. 33 b. The facts may include any of the following: 34 (1) Any of the following that is available in a nationally 35 -2- LSB 1234HZ (1) 89 da/jh 2/ 267
H.F. 844 recognized news or information medium either in print or 1 electronically: statistical or market indices, market prices 2 of any security or group of securities, interest rates, 3 currency exchange rates, or similar economic or financial data. 4 (2) A determination or action by any person or body, 5 including the corporation or any other party to a plan or filed 6 document. 7 (3) The terms of, or actions taken under, an agreement to 8 which the corporation is a party, or any other agreement or 9 document. 10 c. As used in this subsection: 11 (1) “Filed document” means a document filed by the secretary 12 of state under any provision of this chapter except subchapter 13 XV or section 490.1622. 14 (2) “Plan” means a plan of domestication, conversion, 15 merger, or share exchange. 16 d. The following provisions of a plan or filed document 17 shall not be made dependent on facts outside the plan or filed 18 document: 19 (1) The name and address of any person required in a filed 20 document. 21 (2) The registered office of any entity required in a filed 22 document. 23 (3) The registered agent of any entity required in a filed 24 document. 25 (4) The number of authorized shares and designation of each 26 class or series of shares. 27 (5) The effective date of a filed document. 28 (6) Any required statement in a filed document of the date 29 on which the underlying transaction was approved or the manner 30 in which that approval was given. 31 e. If a provision of a filed document is made dependent on a 32 fact ascertainable outside of the filed document, and that fact 33 is neither ascertainable by reference to a source described 34 in paragraph “b” , subparagraph (1), nor a document that is a 35 -3- LSB 1234HZ (1) 89 da/jh 3/ 267
H.F. 844 matter of public record, and the affected shareholders have 1 not received notice of the fact from the corporation, then the 2 corporation shall file with the secretary of state articles of 3 amendment to the filed document setting forth the fact promptly 4 after the time when the fact referred to is first ascertainable 5 or thereafter changes. Articles of amendment under this 6 paragraph “e” are deemed to be authorized by the authorization 7 of the original filed document to which they relate and may be 8 filed by the corporation without further action by the board of 9 directors or the shareholders. 10 Sec. 3. Section 490.121, Code 2021, is amended by striking 11 the section and inserting in lieu thereof the following: 12 490.121 Forms. 13 1. a. The secretary of state may prescribe and furnish on 14 request any of the following forms: 15 (1) An application for a certificate of existence or 16 certificate of registration. 17 (2) A foreign corporation’s registration statement. 18 (3) A foreign corporation’s statement of withdrawal. 19 (4) A foreign corporation’s transfer of registration 20 statement. 21 (5) The biennial report required by section 490.1622. 22 b. If the secretary of state so requires, use of the forms 23 provided in paragraph “a” is mandatory. 24 2. The secretary of state may prescribe and furnish on 25 request forms for other documents required or permitted to be 26 filed pursuant to this chapter but their use is not mandatory. 27 Sec. 4. Section 490.122, Code 2021, is amended by striking 28 the section and inserting in lieu thereof the following: 29 490.122 Filing, service, and copying fees. 30 1. The secretary of state shall collect the following fees 31 when the documents described in this subsection are delivered 32 to the secretary of state for filing: 33 DOCUMENT FEE 34 a. Articles of incorporation . . . . . . . . . . . . . . . . . . . . . . $ 50 35 -4- LSB 1234HZ (1) 89 da/jh 4/ 267
H.F. 844 b. Application for use of indistinguishable 1 name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10 2 c. Application for reserved name . . . . . . . . . . . . . . . . . . $ 10 3 d. Notice of transfer of reserved name . . . . . . . . . . . . $ 10 4 e. Application for registered name . . . . . . . . . . . . . . . . $ 20 5 f. Application for renewal of registered 6 name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20 7 g. Corporation’s statement of change of 8 registered agent or registered office or both . . . . . . . . No fee 9 h. Agent’s statement of change of registered office 10 for each affected corporation not to exceed 11 a total of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . No fee 12 i. Agent’s statement of resignation . . . . . . . . . . . . . . . No fee 13 j. Articles of domestication . . . . . . . . . . . . . . . . . . . . . . $ 50 14 k. Articles of conversion . . . . . . . . . . . . . . . . . . . . . . . . . $ 50 15 l. Amendment of articles of incorporation . . . . . . . . . $ 50 16 m. Restatement of articles of incorporation 17 with amendment of articles . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50 18 n. Restatement of articles of incorporation 19 without amendment of articles . . . . . . . . . . . . . . . . . . . . . . . . $ 50 20 o. Articles of merger or share exchange . . . . . . . . . . . $ 50 21 p. Articles of dissolution . . . . . . . . . . . . . . . . . . . . . . . . $ 5 22 q. Articles of revocation of dissolution . . . . . . . . . . $ 5 23 r. Certificate of administrative dissolution . . . . . . No fee 24 s. Application for reinstatement following 25 administrative dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5 26 t. Certificate of reinstatement . . . . . . . . . . . . . . . . . . . No fee 27 u. Certificate of judicial dissolution . . . . . . . . . . . . No fee 28 v. Foreign registration statement . . . . . . . . . . . . . . . . . $ 100 29 w. Amendment of foreign registration 30 statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 100 31 x. Statement of withdrawal . . . . . . . . . . . . . . . . . . . . . . . . $ 10 32 y. Transfer of foreign registration statement . . . . . $ 100 33 z. Notice of termination of registration . . . . . . . . . . No fee 34 aa. Articles of correction . . . . . . . . . . . . . . . . . . . . . . . . $ 5 35 -5- LSB 1234HZ (1) 89 da/jh 5/ 267
H.F. 844 ab. Articles of validation . . . . . . . . . . . . . . . . . . . . . . . . $ 5 1 ac. Application for certificate of existence or 2 registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5 3 ad. Biennial report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 60 4 ae. Any other document required or permitted to 5 be filed by this chapter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5 6 2. The secretary of state shall collect a fee of five 7 dollars each time process is served on the secretary of state 8 under this chapter. The party to a proceeding causing service 9 of process is entitled to recover this fee as costs if such 10 party prevails in the proceeding. 11 3. The secretary of state shall collect the following fees 12 for copying and certifying the copy of any filed document 13 relating to a domestic or foreign corporation: 14 a. One dollar a page for copying. 15 b. Five dollars for the certificate. 16 Sec. 5. Section 490.123, Code 2021, is amended by striking 17 the section and inserting in lieu thereof the following: 18 490.123 Effective date of filed document. 19 1. Except to the extent otherwise provided in section 20 490.124, subsection 3, and part E, a document accepted for 21 filing is effective as follows: 22 a. On the date and at the time of filing, as provided in 23 section 490.125, subsection 2. 24 b. On the date of filing and at the time specified in the 25 document as its effective time, if later than the time under 26 paragraph “a” . 27 c. At a specified delayed effective date and time which 28 shall not be more than ninety days after filing. 29 d. If a delayed effective date is specified, but no time is 30 specified, at 12:01 a.m. on the date specified, which shall not 31 be more than ninety days after the date of filing. 32 2. If a filed document does not specify the time zone or 33 place at which a date or time or both is to be determined, the 34 date or time or both at which it becomes effective shall be 35 -6- LSB 1234HZ (1) 89 da/jh 6/ 267
H.F. 844 those prevailing at the place of filing in this state. 1 Sec. 6. Section 490.124, Code 2021, is amended by striking 2 the section and inserting in lieu thereof the following: 3 490.124 Correcting filed document. 4 1. A document filed by the secretary of state pursuant to 5 this chapter may be corrected if any of the following applies: 6 a. The document contains an inaccuracy. 7 b. The document was defectively signed, attested, sealed, 8 verified, or acknowledged. 9 c. The electronic transmission was defective. 10 2. A document is corrected by complying with all of the 11 following: 12 a. By preparing articles of correction that do all of the 13 following: 14 (1) Describe the document, including its filing date, or a 15 copy of the document is attached to the articles of correction. 16 (2) Specify the inaccuracy or defect to be corrected. 17 (3) Correct the inaccuracy or defect. 18 b. By delivering the articles of correction to the secretary 19 of state for filing. 20 3. Articles of correction are effective on the effective 21 date of the document they correct except as to persons relying 22 on the uncorrected document and adversely affected by the 23 correction. As to those persons, articles of correction are 24 effective when filed. 25 Sec. 7. Section 490.125, Code 2021, is amended by striking 26 the section and inserting in lieu thereof the following: 27 490.125 Filing duty of secretary of state. 28 1. If a document delivered to the office of the secretary of 29 state for filing satisfies the requirements of section 490.120, 30 the secretary of state shall file it. 31 2. The secretary of state files a document by recording 32 it as filed on the date and time of receipt. After filing 33 a document, except the biennial report required by section 34 490.1622, and except as provided in section 490.503, the 35 -7- LSB 1234HZ (1) 89 da/jh 7/ 267
H.F. 844 secretary of state shall return to the person who delivered 1 the document for filing a copy of the document with an 2 acknowledgment of the date and time of filing. 3 3. If the secretary of state refuses to file a document, 4 it shall be returned to the person who delivered the document 5 for filing within five days after the document was delivered, 6 together with a brief, written explanation of the reason for 7 the refusal. 8 4. The secretary of state’s duty to file documents under 9 this section is ministerial. The secretary of state’s filing 10 or refusing to file a document does not create a presumption 11 of any of the following: 12 a. The document does or does not conform to the requirements 13 of this chapter. 14 b. The information contained in the document is correct or 15 incorrect. 16 Sec. 8. Section 490.126, Code 2021, is amended by striking 17 the section and inserting in lieu thereof the following: 18 490.126 Appeal from secretary of state’s refusal to file 19 document. 20 1. If the secretary of state refuses to file a document 21 delivered for filing, the person that delivered the document 22 for filing may petition the district court of the county where 23 the corporation’s principal office or, if none in this state, 24 its registered office, is located to compel its filing. The 25 document and the explanation of the secretary of state’s 26 refusal to file must be attached to the petition. The court 27 may decide the matter in a summary proceeding. 28 2. The court may order the secretary of state to file the 29 document or take other action the court considers appropriate. 30 3. The court’s final decision may be appealed as in other 31 civil proceedings. 32 Sec. 9. Section 490.127, Code 2021, is amended by striking 33 the section and inserting in lieu thereof the following: 34 490.127 Evidentiary effect of certified copy of filed 35 -8- LSB 1234HZ (1) 89 da/jh 8/ 267
H.F. 844 document. 1 A certificate from the secretary of state delivered with 2 a copy of a document filed by the secretary of state is 3 conclusive evidence that the original document is on file with 4 the secretary of state. 5 Sec. 10. Section 490.128, Code 2021, is amended by striking 6 the section and inserting in lieu thereof the following: 7 490.128 Certificate of existence or registration. 8 1. Any person may apply to the secretary of state to furnish 9 a certificate of existence for a domestic corporation or a 10 certificate of registration for a foreign corporation. 11 2. A certificate of existence must set forth all of the 12 following: 13 a. The domestic corporation’s corporate name. 14 b. That the domestic corporation is duly incorporated under 15 the law of this state, the date of its incorporation, and the 16 period of its duration if less than perpetual. 17 c. That all fees, taxes, and penalties owed to this state 18 have been paid, subject to all of the following: 19 (1) Payment is reflected in the records of the secretary of 20 state. 21 (2) Nonpayment affects the existence of the domestic 22 corporation. 23 d. That its most recent biennial report required by section 24 490.1622 has been filed by the secretary of state. 25 e. That articles of dissolution have not been filed. 26 f. That the corporation is not administratively dissolved 27 and a proceeding is not pending under section 490.1421. 28 g. Other facts of record in the office of the secretary of 29 state that may be requested by the applicant. 30 3. A certificate of registration must set forth all of the 31 following: 32 a. The foreign corporation’s name used in this state. 33 b. That the foreign corporation is registered to do business 34 in this state. 35 -9- LSB 1234HZ (1) 89 da/jh 9/ 267
H.F. 844 c. That all fees, taxes, and penalties owed to this state 1 have been paid, subject to all of the following: 2 (1) Payment is reflected in the records of the secretary of 3 state. 4 (2) Nonpayment affects the registration of the foreign 5 corporation. 6 d. That its most recent biennial report required by section 7 490.1622 has been filed by the secretary of state. 8 e. Other facts of record in the office of the secretary of 9 state that may be requested by the applicant. 10 4. Subject to any qualification stated in the certificate, 11 a certificate of existence or registration issued by the 12 secretary of state may be relied upon as conclusive evidence of 13 the facts stated in the certificate. 14 Sec. 11. Section 490.129, Code 2021, is amended by striking 15 the section and inserting in lieu thereof the following: 16 490.129 Penalty for signing false document. 17 1. A person commits an offense by signing a document that 18 the person knows is false in any material respect with intent 19 that the document be delivered to the secretary of state for 20 filing. 21 2. An offense under this section is a serious misdemeanor 22 punishable by a fine of not to exceed one thousand dollars. 23 Sec. 12. Section 490.135, Code 2021, is amended by striking 24 the section and inserting in lieu thereof the following: 25 490.135 Powers. 26 The secretary of state has the power reasonably necessary to 27 perform the duties required of the secretary of state by this 28 chapter. 29 Sec. 13. Section 490.140, Code 2021, is amended by striking 30 the section and inserting in lieu thereof the following: 31 490.140 Chapter definitions. 32 As used in this chapter, unless otherwise specified: 33 1. “Articles of incorporation” means the articles of 34 incorporation described in section 490.202, all amendments 35 -10- LSB 1234HZ (1) 89 da/jh 10/ 267
H.F. 844 to the articles of incorporation, and any other documents 1 permitted or required to be delivered for filing by a domestic 2 business corporation with the secretary of state under any 3 provision of this chapter that modify, amend, supplement, 4 restate, or replace the articles of incorporation. After 5 an amendment of the articles of incorporation or any other 6 document filed under this chapter that restates the articles of 7 incorporation in their entirety, the articles of incorporation 8 shall not include any prior documents. When used with respect 9 to a foreign corporation or a domestic or foreign nonprofit 10 corporation, the “articles of incorporation” of such an entity 11 means the document of such entity that is equivalent to the 12 articles of incorporation of a domestic business corporation. 13 2. “Authorized shares” means the shares of all classes a 14 domestic or foreign corporation is authorized to issue. 15 3. “Beneficial shareholder” means a person who owns 16 the beneficial interest in shares, which may be a record 17 shareholder or a person on whose behalf shares are registered 18 in the name of an intermediary or nominee. 19 4. “Conspicuous” means so written, displayed, or presented 20 that a reasonable person against whom the writing is to operate 21 should have noticed it. 22 5. “Cooperative association” means an entity that is 23 structured and operated on a cooperative basis pursuant to 26 24 U.S.C. §1381(a) and that meets the definitional requirements of 25 an association as provided in 12 U.S.C. §1141j(a) or 7 U.S.C. 26 §291. 27 6. “Corporation” , “domestic corporation” , “business 28 corporation” , or “domestic business corporation” means a 29 corporation for profit, which is not a foreign corporation, 30 incorporated under this chapter. 31 7. “Deliver” or “delivery” means any method of delivery 32 used in conventional commercial practice, including delivery 33 by hand, mail, commercial delivery, and, if authorized in 34 accordance with section 490.141, by electronic transmission. 35 -11- LSB 1234HZ (1) 89 da/jh 11/ 267
H.F. 844 8. “Distribution” means a direct or indirect transfer of 1 cash or other property, except a corporation’s own shares, 2 or incurrence of indebtedness by a corporation to or for the 3 benefit of its shareholders in respect of any of its shares. 4 A distribution may be in the form of a payment of a dividend; 5 a purchase, redemption, or other acquisition of shares; a 6 distribution of indebtedness; a distribution in liquidation; 7 or otherwise. 8 9. “Document” means any of the following: 9 a. A tangible medium on which information is inscribed, and 10 includes handwritten, typed, printed or similar instruments, 11 and copies of such instruments. 12 b. An electronic record. 13 10. “Domestic” , with respect to an entity, means an entity 14 governed as to its internal affairs by the law of this state. 15 11. “Effective date” , when referring to a document accepted 16 for filing by the secretary of state, means the time and date 17 determined in accordance with section 490.123. 18 12. “Electronic” means relating to technology having 19 electrical, digital, magnetic, wireless, optical, 20 electromagnetic, or similar capabilities. 21 13. “Electronic record” means information that is stored in 22 an electronic or other nontangible medium and is retrievable in 23 paper form through an automated process used in conventional 24 commercial practice, unless otherwise authorized in accordance 25 with section 490.141, subsection 10. 26 14. “Electronic transmission” or “electronically transmitted” 27 means any form or process of communication not directly 28 involving the physical transfer of paper or another tangible 29 medium, which is all of the following: 30 a. Suitable for the retention, retrieval, and reproduction 31 of information by the recipient. 32 b. Retrievable in paper form by the recipient through an 33 automated process used in conventional commercial practice, 34 unless otherwise authorized in accordance with section 490.141, 35 -12- LSB 1234HZ (1) 89 da/jh 12/ 267
H.F. 844 subsection 10. 1 15. “Eligible entity” means a domestic or foreign 2 unincorporated entity or a domestic or foreign nonprofit 3 corporation. 4 16. “Eligible interests” means interests or memberships. 5 17. “Employee” includes an officer but not a director. 6 A director may accept duties that make the director also an 7 employee. 8 18. “Entity” includes a domestic and foreign business 9 corporation; domestic and foreign nonprofit corporation; 10 estate; trust; domestic and foreign unincorporated entity; and 11 a state, the United States, and a foreign government. 12 19. “Expenses” means reasonable expenses of any kind, 13 including reasonable fees and expenses of counsel and experts, 14 that are incurred in connection with a matter. 15 20. “Filing entity” means an unincorporated entity, other 16 than a limited liability partnership, that is of a type that 17 is created by filing a public organic record or is required to 18 file a public organic record that evidences its creation. 19 21. “Foreign” , with respect to an entity, means an entity 20 governed as to its internal affairs by the organic law of a 21 jurisdiction other than this state. 22 22. “Foreign corporation” or “foreign business corporation” 23 means a corporation incorporated under a law other than the 24 law of this state which would be a business corporation if 25 incorporated under the law of this state. 26 23. “Foreign nonprofit corporation” means a corporation 27 incorporated under a law other than the law of this state which 28 would be a nonprofit corporation if incorporated under the law 29 of this state. 30 24. “Foreign registration statement” means the foreign 31 registration statement described in section 490.1503. 32 25. “Governmental subdivision” includes an authority, city, 33 county, district, and municipality. 34 26. “Governor” means any person under whose authority the 35 -13- LSB 1234HZ (1) 89 da/jh 13/ 267
H.F. 844 powers of an entity are exercised and under whose direction the 1 activities and affairs of the entity are managed pursuant to 2 the organic law governing the entity and its organic rules. 3 27. “Includes” and “including” denote a partial definition 4 or a nonexclusive list. 5 28. “Individual” means a natural person. 6 29. “Interest” means either or both of the following rights 7 under the organic law governing an unincorporated entity: 8 a. The right to receive distributions from the entity either 9 in the ordinary course or upon liquidation. 10 b. The right to receive notice or vote on issues involving 11 its internal affairs, other than as an agent, assignee, proxy, 12 or person responsible for managing its business and affairs. 13 30. “Interest holder” means a person who holds of record an 14 interest. 15 31. a. “Interest holder liability” means any of the 16 following: 17 (1) Personal liability for a debt, obligation, or other 18 liability of a domestic or foreign corporation or eligible 19 entity that is imposed on a person by any of the following: 20 (a) Solely by reason of the person’s status as a 21 shareholder, member, or interest holder. 22 (b) By the articles of incorporation of the domestic 23 corporation or the organic rules of the eligible entity 24 or foreign corporation that make one or more specified 25 shareholders, members, or interest holders, or categories of 26 shareholders, members, or interest holders, liable in their 27 capacity as shareholders, members, or interest holders for all 28 or specified liabilities of the corporation or eligible entity. 29 (2) An obligation of a shareholder, member, or interest 30 holder under the articles of incorporation of a domestic 31 corporation or the organic rules of an eligible entity or 32 foreign corporation to contribute to the entity. 33 b. For purposes of paragraph “a” , except as otherwise 34 provided in the articles of incorporation of a domestic 35 -14- LSB 1234HZ (1) 89 da/jh 14/ 267
H.F. 844 corporation or the organic law or organic rules of an eligible 1 entity or a foreign corporation, interest holder liability 2 arises under paragraph “a” , subparagraph (1), when the 3 corporation or eligible entity incurs the liability. 4 32. “Jurisdiction of formation” means the state or country 5 the law of which includes the organic law governing a domestic 6 or foreign corporation or eligible entity. 7 33. “Means” denotes an exhaustive definition. 8 34. “Membership” means the rights of a member in a domestic 9 or foreign nonprofit corporation. 10 35. “Merger” means a transaction pursuant to section 11 490.1102. 12 36. “Nonfiling entity” means an unincorporated entity that 13 is of a type that is not created by filing a public organic 14 record. 15 37. “Nonprofit corporation” or “domestic nonprofit 16 corporation” means a corporation incorporated under the laws of 17 this state and subject to the provisions of chapter 504. 18 38. “Organic law” means the statute governing the internal 19 affairs of a domestic or foreign business or nonprofit 20 corporation or unincorporated entity. 21 39. “Organic rules” means the public organic record and 22 private organic rules of a domestic or foreign corporation or 23 eligible entity. 24 40. “Person” means a person as defined in section 4.1. 25 41. “Principal office” means the office, in or out of this 26 state, so designated in the biennial report required by section 27 490.1622 or foreign registration statement where the principal 28 executive offices of a domestic or foreign corporation are 29 located. 30 42. a. “Private organic rules” means any of the following: 31 (1) The bylaws of a domestic or foreign business or 32 nonprofit corporation. 33 (2) The rules, regardless of whether in writing, that govern 34 the internal affairs of an unincorporated entity, are binding 35 -15- LSB 1234HZ (1) 89 da/jh 15/ 267
H.F. 844 on all of its interest holders, and are not part of its public 1 organic record, if any. 2 b. Where private organic rules have been amended or 3 restated, the term means the private organic rules as last 4 amended or restated. 5 43. “Proceeding” includes a civil suit and criminal, 6 administrative, and investigatory action. 7 44. a. “Public organic record” means any of the following: 8 (1) The articles of incorporation of a domestic or foreign 9 business or nonprofit corporation. 10 (2) The document, if any, the filing of which is required 11 to create an unincorporated entity, or which creates the 12 unincorporated entity and is required to be filed. 13 b. Where a public organic record has been amended or 14 restated, the term means the public organic record as last 15 amended or restated. 16 45. “Record date” means the date fixed for determining 17 the identity of the corporation’s shareholders and their 18 shareholdings for purposes of this chapter. Unless another 19 time is specified when the record date is fixed, the 20 determination shall be made as of the close of business at the 21 principal office of the corporation on the date so fixed. 22 46. “Record shareholder” means any of the following: 23 a. The person in whose name shares are registered in the 24 records of the corporation. 25 b. The person identified as the beneficial owner of shares 26 in a beneficial ownership certificate pursuant to section 27 490.723 on file with the corporation to the extent of the 28 rights granted by such certificate. 29 47. “Registered foreign corporation” means a foreign 30 corporation registered to do business in the state pursuant to 31 subchapter XV. 32 48. “Secretary” means the corporate officer to whom the 33 board of directors has delegated responsibility under section 34 490.840, subsection 3, to maintain the minutes of the meetings 35 -16- LSB 1234HZ (1) 89 da/jh 16/ 267
H.F. 844 of the board of directors and of the shareholders and for 1 authenticating records of the corporation. 2 49. “Share exchange” means a transaction pursuant to section 3 490.1103. 4 50. “Shareholder” means a record shareholder. 5 51. “Shares” means the units into which the proprietary 6 interests in a domestic or foreign corporation are divided. 7 52. “Sign” or “signature” means, with present intent to 8 authenticate or adopt a document, doing any of the following: 9 a. Executing or adopting a tangible symbol to a document, 10 including any manual, facsimile, or conformed signature. 11 b. Attaching to or logically associating with an electronic 12 transmission an electronic sound, symbol, or process, 13 and including an electronic signature in an electronic 14 transmission. 15 53. “State” , when referring to a part of the United 16 States, includes a state and commonwealth, and their agencies 17 and governmental subdivisions, and a territory and insular 18 possession, and their agencies and governmental subdivisions, 19 of the United States. 20 54. “Subscriber” means a person who subscribes for shares in 21 a corporation, whether before or after incorporation. 22 55. “Type of entity” means a generic form of entity that is 23 any of the following: 24 a. Recognized at common law. 25 b. Formed under an organic law, regardless of whether 26 some entities formed under that law are subject to provisions 27 of that law that create different categories of the form of 28 entity. 29 56. a. “Unincorporated entity” means an organization 30 or artificial legal person that either has a separate legal 31 existence or has the power to acquire an estate in real 32 property in its own name and that is not any of the following: 33 (1) A domestic or foreign business or nonprofit 34 corporation. 35 -17- LSB 1234HZ (1) 89 da/jh 17/ 267
H.F. 844 (2) A series of a limited liability company or of another 1 type of entity. 2 (3) An estate. 3 (4) A trust. 4 (5) A state, the United States, or foreign government. 5 b. “Unincorporated entity” includes a general partnership, 6 limited liability company, limited partnership, business 7 trust, joint stock association, and unincorporated nonprofit 8 association. 9 57. “United States” includes district, authority, bureau, 10 commission, department, and any other agency of the United 11 States. 12 58. “Unrestricted voting trust beneficial owner” means, with 13 respect to any shareholder rights, a voting trust beneficial 14 owner whose entitlement to exercise the shareholder right in 15 question is not inconsistent with the voting trust agreement. 16 59. “Voting group” means all shares of one or more 17 classes or series that under the articles of incorporation 18 or this chapter are entitled to vote and be counted together 19 collectively on a matter at a meeting of shareholders. All 20 shares entitled by the articles of incorporation or this 21 chapter to vote generally on the matter are for that purpose 22 a single voting group. 23 60. “Voting power” means the current power to vote in the 24 election of directors. 25 61. “Voting trust beneficial owner” means an owner of 26 a beneficial interest in shares of the corporation held 27 in a voting trust established pursuant to section 490.730, 28 subsection 1. 29 62. “Writing” or “written” means any information in the form 30 of a document. 31 Sec. 14. Section 490.141, Code 2021, is amended by striking 32 the section and inserting in lieu thereof the following: 33 490.141 Notices and other communications. 34 1. A notice under this chapter must be in writing unless 35 -18- LSB 1234HZ (1) 89 da/jh 18/ 267
H.F. 844 oral notice is reasonable in the circumstances. Unless 1 otherwise agreed between the sender and the recipient, words 2 in a notice or other communication under this chapter must be 3 in English. 4 2. A notice or other communication may be given by any 5 method of delivery, except that electronic transmissions must 6 be in accordance with this section. If the methods of delivery 7 are impracticable, a notice or other communication may be 8 given by means of a broad nonexclusionary distribution to the 9 public, which may include a newspaper of general circulation 10 in the area where published; radio, television, or other 11 form of public broadcast communication; or other methods of 12 distribution that the corporation has previously identified to 13 its shareholders. 14 3. A notice or other communication to a domestic corporation 15 or to a foreign corporation registered to do business in this 16 state may be delivered to the corporation’s registered agent at 17 its registered office or to the secretary at the corporation’s 18 principal office shown in its most recent biennial report 19 required by section 490.1622 or, in the case of a foreign 20 corporation that has not yet delivered a biennial report, in 21 its foreign registration statement. 22 4. A notice or other communication may be delivered by 23 electronic transmission if consented to by the recipient or if 24 authorized by subsection 10. 25 5. Any consent under subsection 4 may be revoked by the 26 person who consented by written or electronic notice to the 27 person to whom the consent was delivered. Any such consent is 28 deemed revoked if all of the following apply: 29 a. The corporation is unable to deliver two consecutive 30 electronic transmissions given by the corporation in accordance 31 with such consent. 32 b. Such inability becomes known to the secretary or an 33 assistant secretary or to the transfer agent, or other person 34 responsible for the giving of notice or other communications; 35 -19- LSB 1234HZ (1) 89 da/jh 19/ 267
H.F. 844 provided, however, the inadvertent failure to treat such 1 inability as a revocation shall not invalidate any meeting or 2 other action. 3 6. Unless otherwise agreed between the sender and the 4 recipient, an electronic transmission is received when all of 5 the following apply: 6 a. The electronic transmission enters an information 7 processing system that the recipient has designated or uses 8 for the purposes of receiving electronic transmissions or 9 information of the type sent, and from which the recipient is 10 able to retrieve the electronic transmission. 11 b. The electronic transmission is in a form capable of being 12 processed by that system. 13 7. Receipt of an electronic acknowledgment from an 14 information processing system described in subsection 6, 15 paragraph “a” , establishes that an electronic transmission was 16 received but, by itself, does not establish that the content 17 sent corresponds to the content received. 18 8. An electronic transmission is received under this 19 section even if no person is aware of its receipt. 20 9. A notice or other communication, if in a comprehensible 21 form or manner, is effective at the earliest of the following: 22 a. If in a physical form, the earliest of when it is 23 actually received, or when it is left at any of the following: 24 (1) A shareholder’s address shown on the corporation’s 25 record of shareholders maintained by the corporation under 26 section 490.1601, subsection 4. 27 (2) A director’s residence or usual place of business. 28 (3) The corporation’s principal office. 29 b. If mailed by postage prepaid and correctly addressed to a 30 shareholder, upon deposit in the United States mail. 31 c. If mailed by United States mail postage prepaid and 32 correctly addressed to a recipient other than a shareholder, 33 the earliest of when it is actually received, or as follows: 34 (1) If sent by registered or certified mail, return receipt 35 -20- LSB 1234HZ (1) 89 da/jh 20/ 267
H.F. 844 requested, the date shown on the return receipt signed by or on 1 behalf of the addressee. 2 (2) Five days after it is deposited in the United States 3 mail. 4 d. If an electronic transmission, when it is received as 5 provided in subsection 6. 6 e. If oral, when communicated. 7 10. A notice or other communication may be in the form of 8 an electronic transmission that cannot be directly reproduced 9 in paper form by the recipient through an automated process 10 used in conventional commercial practice only if all of the 11 following apply: 12 a. The electronic transmission is otherwise retrievable in 13 perceivable form. 14 b. The sender and the recipient have consented in writing to 15 the use of such form of electronic transmission. 16 11. If this chapter prescribes requirements for notices 17 or other communications in particular circumstances, those 18 requirements govern. If articles of incorporation or bylaws 19 prescribe requirements for notices or other communications, 20 not inconsistent with this section or other provisions of 21 this chapter, those requirements govern. The articles of 22 incorporation or bylaws may authorize or require delivery of 23 notices of meetings of directors by electronic transmission. 24 12. In the event that any provisions of this chapter are 25 deemed to modify, limit, or supersede the federal Electronic 26 Signatures in Global and National Commerce Act, 15 U.S.C. 27 §§7001 et seq., the provisions of this chapter shall control 28 to the maximum extent permitted by section 102(a)(2) of that 29 federal Act. 30 13. a. Whenever notice would otherwise be required to be 31 given under any provision of this subchapter to a shareholder, 32 such notice need not be given if any of the following apply: 33 (1) Notices to the shareholders of two consecutive annual 34 meetings, and all notices of meetings during the period between 35 -21- LSB 1234HZ (1) 89 da/jh 21/ 267
H.F. 844 such two consecutive annual meetings, have been sent to such 1 shareholder at such shareholder’s address as shown on the 2 records of the corporation and have been returned undeliverable 3 or could not be delivered. 4 (2) All, but not less than two, payments of dividends on 5 securities during a twelve-month period, or two consecutive 6 payments of dividends on securities during a period of more 7 than twelve months, have been sent to such shareholder at 8 such shareholder’s address as shown on the records of the 9 corporation and have been returned undeliverable or could not 10 be delivered. 11 b. If any such shareholder shall deliver to the corporation 12 a written notice setting forth such shareholder’s then-current 13 address, the requirement that notice be given to such 14 shareholder shall be reinstated. 15 Sec. 15. Section 490.142, Code 2021, is amended by striking 16 the section and inserting in lieu thereof the following: 17 490.142 Number of shareholders. 18 1. For purposes of this chapter, any of the following 19 identified as a shareholder in a corporation’s current record 20 of shareholders constitutes one shareholder: 21 a. Three or fewer co-owners. 22 b. A corporation, partnership, trust, estate, or other 23 entity. 24 c. The trustees, guardians, custodians, or other fiduciaries 25 of a single trust, estate, or account. 26 2. For purposes of this chapter, shareholdings registered 27 in substantially similar names constitute one shareholder if 28 it is reasonable to believe that the names represent the same 29 person. 30 Sec. 16. Section 490.143, Code 2021, is amended by striking 31 the section and inserting in lieu thereof the following: 32 490.143 Qualified director. 33 1. As used in this chapter, a “qualified director” means a 34 director who takes action, if at the time action is to be taken 35 -22- LSB 1234HZ (1) 89 da/jh 22/ 267
H.F. 844 any of the following applies: 1 a. Under section 490.202, subsection 2, paragraph “f” , is 2 not a director under any of the following circumstances: 3 (1) To whom the limitation or elimination of the duty of 4 an officer to offer potential business opportunities to the 5 corporation would apply. 6 (2) Has a material relationship with any other person to 7 whom the limitation or elimination described in subparagraph 8 (1) would apply. 9 b. Under section 490.744, does not have any of the 10 following: 11 (1) A material interest in the outcome of the proceeding. 12 (2) A material relationship with a person who has such an 13 interest. 14 c. Under section 490.853 or 490.855, all of the following 15 apply: 16 (1) The director is not a party to the proceeding. 17 (2) The director is not a director as to whom a transaction 18 is a director’s conflicting interest transaction or who sought 19 a disclaimer of the corporation’s interest in a business 20 opportunity under section 490.870, which transaction or 21 disclaimer is challenged in the proceeding. 22 (3) The director does not have a material relationship with 23 a director described in either subparagraph (1) or (2). 24 d. Under section 490.862, the director is not any of the 25 following: 26 (1) A director as to whom the transaction is a director’s 27 conflicting interest transaction. 28 (2) A director who has a material relationship with another 29 director as to whom the transaction is a director’s conflicting 30 interest transaction. 31 e. Under section 490.870, is not a director who does any of 32 the following: 33 (1) Pursues or takes advantage of the business opportunity, 34 directly or indirectly through or on behalf of another person. 35 -23- LSB 1234HZ (1) 89 da/jh 23/ 267
H.F. 844 (2) Has a material relationship with a director or officer 1 who pursues or takes advantage of the business opportunity, 2 directly, or indirectly through or on behalf of another person. 3 2. As used in this section, all of the following apply: 4 a. “Material interest” means an actual or potential 5 benefit or detriment, other than one which would devolve on 6 the corporation or the shareholders generally, that would 7 reasonably be expected to impair the objectivity of the 8 director’s judgment when participating in the action to be 9 taken. 10 b. “Material relationship” means a familial, financial, 11 professional, employment, or other relationship that would 12 reasonably be expected to impair the objectivity of the 13 director’s judgment when participating in the action to be 14 taken. 15 3. The presence of one or more of the following 16 circumstances shall not automatically prevent a director from 17 being a qualified director: 18 a. Nomination or election of the director to the current 19 board by any director who is not a qualified director with 20 respect to the matter, or by any person that has a material 21 relationship with that director, acting alone or participating 22 with others. 23 b. Service as a director of another corporation of which a 24 director who is not a qualified director with respect to the 25 matter, or any individual who has a material relationship with 26 that director, is or was also a director. 27 c. With respect to action to be taken under section 490.744, 28 status as a named defendant, as a director against whom action 29 is demanded, or as a director who approved the conduct being 30 challenged. 31 Sec. 17. Section 490.144, Code 2021, is amended by striking 32 the section and inserting in lieu thereof the following: 33 490.144 Householding. 34 1. A corporation has delivered written notice or any 35 -24- LSB 1234HZ (1) 89 da/jh 24/ 267
H.F. 844 other report or statement under this chapter, the articles of 1 incorporation, or the bylaws to all shareholders who share a 2 common address if all of the following apply: 3 a. The corporation delivers one copy of the notice, report, 4 or statement to the common address. 5 b. The corporation addresses the notice, report, or 6 statement to those shareholders either as a group or to each 7 of those shareholders individually or to the shareholders in a 8 form to which each of those shareholders has consented. 9 c. Each of those shareholders consents to delivery of 10 a single copy of such notice, report, or statement to the 11 shareholders’ common address. 12 2. Any such consent described in subsection 1, paragraph 13 “b” or “c” , shall be revocable by any of such shareholders who 14 deliver written notice of revocation to the corporation. If 15 such written notice of revocation is delivered, the corporation 16 shall begin providing individual notices, reports, or other 17 statements to the revoking shareholder no later than thirty 18 days after delivery of the written notice of revocation. 19 3. Any shareholder who fails to object by written notice 20 to the corporation, within sixty days of written notice by 21 the corporation of its intention to deliver single copies of 22 notices, reports, or statements to shareholders who share a 23 common address as permitted by subsection 1, shall be deemed 24 to have consented to receiving such single copy at the common 25 address; provided that the notice of intention explains that 26 consent may be revoked and the method for revoking. 27 Sec. 18. NEW SECTION . 490.145 Part definitions. 28 As used in this part: 29 1. “Corporate action” means any action taken by or on 30 behalf of the corporation, including any action taken by the 31 incorporator, the board of directors, a committee of the board 32 of directors, an officer or agent of the corporation, or the 33 shareholders. 34 2. “Date of the defective corporate action” means the date 35 -25- LSB 1234HZ (1) 89 da/jh 25/ 267
H.F. 844 or, if the defective corporate action occurred or may have 1 occurred on more than one date, the range of dates, or the 2 approximate date or range of dates, if the exact date or range 3 of dates is unknown or not readily ascertainable, the defective 4 corporate action was purported to have been taken. 5 3. “Defective corporate action” means all of the following: 6 a. Any corporate action purportedly taken that is, and at 7 the time such corporate action was purportedly taken would 8 have been, within the power of the corporation, but is void or 9 voidable due to a failure of authorization. 10 b. An overissue. 11 4. “Failure of authorization” means the failure to 12 authorize, approve, or otherwise effect a corporate action in 13 compliance with the provisions of this chapter, the articles of 14 incorporation or bylaws, a corporate resolution, or any plan 15 or agreement to which the corporation is a party, if and to the 16 extent such failure would render such corporate action void or 17 voidable. 18 5. “Overissue” means the purported issuance of any of the 19 following: 20 a. Shares of a class or series in excess of the number of 21 shares of a class or series the corporation has the power to 22 issue under section 490.601 at the time of such issuance. 23 b. Shares of any class or series that is not then authorized 24 for issuance by the articles of incorporation. 25 6. “Putative shares” means the shares of any class or 26 series, including shares issued upon exercise of rights, 27 options, warrants or other securities convertible into 28 shares of the corporation, or interests with respect to such 29 shares, that were created or issued as a result of a defective 30 corporate action, and any of the following applies: 31 a. But for any failure of authorization would constitute 32 valid shares. 33 b. Cannot be determined by the board of directors to be 34 valid shares. 35 -26- LSB 1234HZ (1) 89 da/jh 26/ 267
H.F. 844 7. “Valid shares” means the shares of any class or series 1 that have been duly authorized and validly issued in accordance 2 with this chapter, including as a result of ratification or 3 validation under this part. 4 8. a. “Validation effective time” with respect to any 5 defective corporate action ratified under this part means the 6 later of the following: 7 (1) The time at which the ratification of the defective 8 corporate action is approved by the shareholders, or if 9 approval of shareholders is not required, the time at which 10 the notice required by section 490.149 becomes effective in 11 accordance with section 490.141. 12 (2) The time at which any articles of validation filed in 13 accordance with section 490.151 become effective. 14 b. The validation effective time shall not be affected by 15 the filing or pendency of a judicial proceeding under section 16 490.152 or otherwise, unless otherwise ordered by the court. 17 Sec. 19. NEW SECTION . 490.146 Defective corporate actions. 18 1. A defective corporate action shall not be void or 19 voidable if ratified in accordance with section 490.147 or 20 validated in accordance with section 490.152. 21 2. Ratification under section 490.147 or validation under 22 section 490.152 shall not be deemed to be the exclusive means 23 of ratifying or validating any defective corporate action, and 24 the absence or failure of ratification in accordance with this 25 part shall not, of itself, affect the validity or effectiveness 26 of any corporate action properly ratified under common law or 27 otherwise, nor shall it create a presumption that any such 28 corporate action is or was a defective corporate action or void 29 or voidable. 30 3. In the case of an overissue, putative shares shall be 31 valid shares effective as of the date originally issued or 32 purportedly issued upon any of the following: 33 a. The effectiveness under this part and under subchapter X 34 of an amendment to the articles of incorporation authorizing, 35 -27- LSB 1234HZ (1) 89 da/jh 27/ 267
H.F. 844 designating, or creating such shares. 1 b. The effectiveness of any other corporate action under 2 this part ratifying the authorization, designation, or creation 3 of such shares. 4 Sec. 20. NEW SECTION . 490.147 Ratification of defective 5 corporate actions. 6 1. To ratify a defective corporate action under this 7 section, other than the ratification of an election of the 8 initial board of directors under subsection 2, the board of 9 directors shall take action ratifying the action in accordance 10 with section 490.148, stating all of the following: 11 a. The defective corporate action to be ratified and, if the 12 defective corporate action involved the issuance of putative 13 shares, the number and type of putative shares purportedly 14 issued. 15 b. The date of the defective corporate action. 16 c. The nature of the failure of authorization with respect 17 to the defective corporate action to be ratified. 18 d. That the board of directors approves the ratification of 19 the defective corporate action. 20 2. In the event that a defective corporate action to be 21 ratified relates to the election of the initial board of 22 directors of the corporation under section 490.205, subsection 23 1, paragraph “b” , a majority of the persons who, at the time of 24 the ratification, are exercising the powers of directors may 25 take an action stating all of the following: 26 a. The name of the person or persons who first took 27 action in the name of the corporation as the initial board of 28 directors of the corporation. 29 b. The earlier of the date on which such persons first 30 took such action or were purported to have been elected as the 31 initial board of directors. 32 c. That the ratification of the election of such person or 33 persons as the initial board of directors is approved. 34 3. If any provision of this chapter, the articles of 35 -28- LSB 1234HZ (1) 89 da/jh 28/ 267
H.F. 844 incorporation or bylaws, any corporate resolution, or any 1 plan or agreement to which the corporation is a party in 2 effect at the time action under subsection 1 is taken requires 3 shareholder approval or would have required shareholder 4 approval at the date of the occurrence of the defective 5 corporate action, the ratification of the defective corporate 6 action approved in the action taken by the directors under 7 subsection 1 shall be submitted to the shareholders for 8 approval in accordance with section 490.148. 9 4. Unless otherwise provided in the action taken by the 10 board of directors under subsection 1, after the action by the 11 board of directors has been taken and, if required, approved 12 by the shareholders, the board of directors may abandon the 13 ratification at any time before the validation effective time 14 without further action of the shareholders. 15 Sec. 21. NEW SECTION . 490.148 Action on ratification. 16 1. The quorum and voting requirements applicable to a 17 ratifying action by the board of directors under section 18 490.147, subsection 1, shall be the quorum and voting 19 requirements applicable to the corporate action proposed to be 20 ratified at the time such ratifying action is taken. 21 2. If the ratification of the defective corporate action 22 requires approval by the shareholders under section 490.147, 23 subsection 3, and if the approval is to be given at a meeting, 24 the corporation shall notify each holder of valid and putative 25 shares, regardless of whether entitled to vote, as of the 26 record date for notice of the meeting and as of the date of 27 the occurrence of defective corporate action, provided that 28 notice shall not be required to be given to holders of valid or 29 putative shares whose identities or addresses for notice cannot 30 be determined from the records of the corporation. The notice 31 must state that the purpose, or one of the purposes, of the 32 meeting is to consider ratification of a defective corporate 33 action and must be accompanied by all of the following: 34 a. Either a copy of the action taken by the board of 35 -29- LSB 1234HZ (1) 89 da/jh 29/ 267
H.F. 844 directors in accordance with section 490.147, subsection 1, 1 or the information required by section 490.147, subsection 1, 2 paragraphs “a” through “d” . 3 b. A statement that any claim that the ratification of 4 such defective corporate action and any putative shares issued 5 as a result of such defective corporate action should not be 6 effective, or should be effective only on certain conditions, 7 shall be brought within one hundred twenty days from the 8 applicable validation effective time. 9 3. Except as provided in subsection 4, with respect to the 10 voting requirements to ratify the election of a director, the 11 quorum and voting requirements applicable to the approval by 12 the shareholders required by section 490.147, subsection 3, 13 shall be the quorum and voting requirements applicable to the 14 corporate action proposed to be ratified at the time of such 15 shareholder approval. 16 4. The approval by shareholders to ratify the election of a 17 director requires that the votes cast within the voting group 18 favoring such ratification exceed the votes cast opposing such 19 ratification of the election at a meeting at which a quorum is 20 present. 21 5. Putative shares on the record date for determining 22 the shareholders entitled to vote on any matter submitted to 23 shareholders under section 490.147, subsection 3, and without 24 giving effect to any ratification of putative shares that 25 becomes effective as a result of such vote, shall neither be 26 entitled to vote nor counted for quorum purposes in any vote to 27 approve the ratification of any defective corporate action. 28 6. If the approval under this section of putative shares 29 would result in an overissue, in addition to the approval 30 required by section 490.147, approval of an amendment to the 31 articles of incorporation under subchapter X to increase 32 the number of shares of an authorized class or series or to 33 authorize the creation of a class or series of shares so there 34 would be no overissue shall also be required. 35 -30- LSB 1234HZ (1) 89 da/jh 30/ 267
H.F. 844 Sec. 22. NEW SECTION . 490.149 Notice requirements. 1 1. Unless shareholder approval is required under section 2 490.147, subsection 3, prompt notice of an action taken under 3 section 490.147 shall be given to each holder of valid and 4 putative shares, regardless of whether entitled to vote, as of 5 all of the following: 6 a. The date of such action by the board of directors. 7 b. The date of the defective corporate action ratified, 8 provided that notice shall not be required to be given to 9 holders of valid and putative shares whose identities or 10 addresses for notice cannot be determined from the records of 11 the corporation. 12 2. The notice must contain all of the following: 13 a. Either a copy of the action taken by the board of 14 directors in accordance with section 490.147, subsection 1 or 15 2, or the information required by section 490.147, subsection 16 1, paragraphs “a” through “d” , or section 490.147, subsection 2, 17 paragraphs “a” through “c” , as applicable. 18 b. A statement that any claim that the ratification of 19 the defective corporate action and any putative shares issued 20 as a result of such defective corporate action should not be 21 effective, or should be effective only on certain conditions, 22 shall be brought within one hundred twenty days from the 23 applicable validation effective time. 24 3. No notice under this section is required with respect 25 to any action required to be submitted to shareholders for 26 approval under section 490.147, subsection 3, if notice is 27 given in accordance with section 490.148, subsection 2. 28 4. A notice required by this section may be given in any 29 manner permitted by section 490.141 and, for any corporation 30 subject to the reporting requirements of section 13 or 15(d) of 31 the federal Securities Exchange Act of 1934, may be given by 32 means of a filing or furnishing of such notice with the United 33 States securities and exchange commission. 34 Sec. 23. NEW SECTION . 490.150 Effect of ratification. 35 -31- LSB 1234HZ (1) 89 da/jh 31/ 267
H.F. 844 From and after the validation effective time, and without 1 regard to the one hundred twenty-day period during which 2 a claim may be brought under section 490.152, all of the 3 following shall apply: 4 1. Each defective corporate action ratified in accordance 5 with section 490.147 shall not be void or voidable as a result 6 of the failure of authorization identified in the action taken 7 under section 490.147, subsection 1 or 2, and shall be deemed 8 a valid corporate action effective as of the date of the 9 defective corporate action. 10 2. The issuance of each putative share or fraction of a 11 putative share purportedly issued pursuant to a defective 12 corporate action identified in the action taken under section 13 490.147 shall not be void or voidable, and each such putative 14 share or fraction of a putative share shall be deemed to be an 15 identical share or fraction of a valid share as of the time it 16 was purportedly issued. 17 3. Any corporate action taken subsequent to the defective 18 corporate action ratified in accordance with this part in 19 reliance on such defective corporate action having been 20 validly effected and any subsequent defective corporate action 21 resulting directly or indirectly from such original defective 22 corporate action shall be valid as of the time taken. 23 Sec. 24. NEW SECTION . 490.151 Filings. 24 1. If the defective corporate action ratified under this 25 part would have required under any other section of this 26 chapter a filing in accordance with this chapter, then, 27 regardless of whether a filing was previously made in respect 28 of such defective corporate action and in lieu of a filing 29 otherwise required by this chapter, the corporation shall file 30 articles of validation in accordance with this section, and 31 such articles of validation shall serve to amend or substitute 32 for any other filing with respect to such defective corporate 33 action required by this chapter. 34 2. The articles of validation must set forth all of the 35 -32- LSB 1234HZ (1) 89 da/jh 32/ 267
H.F. 844 following: 1 a. The defective corporate action that is the subject of the 2 articles of validation, including in the case of any defective 3 corporate action involving the issuance of putative shares, the 4 number and type of putative shares issued and the date or dates 5 upon which such putative shares were purported to have been 6 issued. 7 b. The date of the defective corporate action. 8 c. The nature of the failure of authorization in respect of 9 the defective corporate action. 10 d. A statement that the defective corporate action was 11 ratified in accordance with section 490.147, including 12 the date on which the board of directors ratified such 13 defective corporate action and the date, if any, on which 14 the shareholders approved the ratification of such defective 15 corporate action. 16 e. The information required by subsection 3. 17 3. The articles of validation must also contain the 18 following information: 19 a. If a filing was previously made in respect of the 20 defective corporate action and no changes to such filing are 21 required to give effect to the ratification of such defective 22 corporate action in accordance with section 490.147, the 23 articles of validation must set forth all of the following: 24 (1) The name, title, and filing date of the filing 25 previously made and any articles of correction to that filing. 26 (2) A statement that a copy of the filing previously made, 27 together with any articles of correction to that filing, is 28 attached as an exhibit to the articles of validation. 29 b. If a filing was previously made in respect of the 30 defective corporate action and such filing requires any change 31 to give effect to the ratification of such defective corporate 32 action in accordance with section 490.147, the articles of 33 validation must set forth all of the following: 34 (1) The name, title, and filing date of the filing 35 -33- LSB 1234HZ (1) 89 da/jh 33/ 267
H.F. 844 previously made and any articles of correction to that filing. 1 (2) A statement that a filing containing all of the 2 information required to be included under the applicable 3 section or sections of this chapter to give effect to such 4 defective corporate action is attached as an exhibit to the 5 articles of validation. 6 (3) The date and time that such filing is deemed to have 7 become effective. 8 c. If a filing was not previously made in respect of the 9 defective corporate action and the defective corporate action 10 ratified under section 490.147 would have required a filing 11 under any other section of this chapter, the articles of 12 validation must set forth all of the following: 13 (1) A statement that a filing containing all of the 14 information required to be included under the applicable 15 section or sections of this chapter to give effect to such 16 defective corporate action is attached as an exhibit to the 17 articles of validation. 18 (2) The date and time that such filing is deemed to have 19 become effective. 20 Sec. 25. NEW SECTION . 490.152 Judicial proceedings 21 regarding validity of corporate actions. 22 1. Upon application by the corporation, any successor 23 entity to the corporation, a director of the corporation, any 24 shareholder, beneficial shareholder, or unrestricted voting 25 trust beneficial owner of the corporation, including any 26 such shareholder, beneficial shareholder, or unrestricted 27 voting trust beneficial owner as of the date of the defective 28 corporate action ratified under section 490.147, or any other 29 person claiming to be substantially and adversely affected by a 30 ratification under section 490.147, the district court of the 31 county where a corporation’s principal office or, if none in 32 this state, its registered office, is located may do all of the 33 following: 34 a. Determine the validity and effectiveness of any corporate 35 -34- LSB 1234HZ (1) 89 da/jh 34/ 267
H.F. 844 action or defective corporate action. 1 b. Determine the validity and effectiveness of any 2 ratification under section 490.147. 3 c. Determine the validity of any putative shares. 4 d. Modify or waive any of the procedures specified in 5 section 490.147 or 490.148 to ratify a defective corporate 6 action. 7 2. In connection with an action under this section, the 8 court may make such findings or orders, and take into account 9 any factors or considerations, regarding such matters as it 10 deems proper under the circumstances. 11 3. Service of process of the application under subsection 12 1 on the corporation may be made in any manner provided by 13 statute of this state or by rule of the applicable court for 14 service on the corporation, and no other party need be joined 15 in order for the court to adjudicate the matter. In an action 16 filed by the corporation, the court may require notice of the 17 action to be provided to other persons specified by the court 18 and permit such other persons to intervene in the action. 19 4. Notwithstanding any other provision of this section or 20 otherwise under applicable law, any action asserting that the 21 ratification of any defective corporate action and any putative 22 shares issued as a result of such defective corporate action 23 should not be effective, or should be effective only on certain 24 conditions, shall be brought within one hundred twenty days of 25 the validation effective time. 26 Sec. 26. Section 490.201, Code 2021, is amended by striking 27 the section and inserting in lieu thereof the following: 28 490.201 Incorporators. 29 One or more persons may act as the incorporator or 30 incorporators of a corporation by delivering articles of 31 incorporation to the secretary of state for filing. 32 Sec. 27. Section 490.202, Code 2021, is amended by striking 33 the section and inserting in lieu thereof the following: 34 490.202 Articles of incorporation. 35 -35- LSB 1234HZ (1) 89 da/jh 35/ 267
H.F. 844 1. The articles of incorporation must set forth all of the 1 following: 2 a. A corporate name for the corporation that satisfies the 3 requirements of section 490.401. 4 b. The number of shares the corporation is authorized to 5 issue. 6 c. The street and mailing addresses of the corporation’s 7 initial registered office and the name of its initial 8 registered agent at that office. 9 d. The name and address of each incorporator. 10 2. The articles of incorporation may set forth any of the 11 following: 12 a. The names and addresses of the individuals who are to 13 serve as the initial directors. 14 b. Provisions not inconsistent with law regarding any of the 15 following: 16 (1) The purpose or purposes for which the corporation is 17 organized. 18 (2) Managing the business and regulating the affairs of the 19 corporation. 20 (3) Defining, limiting, and regulating the powers of the 21 corporation, its board of directors, and shareholders. 22 (4) A par value for authorized shares or classes of shares. 23 (5) The imposition of interest holder liability on 24 shareholders. 25 c. Any provision that under this chapter is required or 26 permitted to be set forth in the bylaws. 27 d. A provision eliminating or limiting the liability 28 of a director to the corporation or its shareholders for 29 money damages for any action taken, or any failure to take 30 any action, as a director, except liability for any of the 31 following: 32 (1) The amount of a financial benefit received by a director 33 to which the director is not entitled. 34 (2) An intentional infliction of harm on the corporation or 35 -36- LSB 1234HZ (1) 89 da/jh 36/ 267
H.F. 844 the shareholders. 1 (3) A violation of section 490.833. 2 (4) An intentional violation of criminal law. 3 e. A provision permitting or making obligatory 4 indemnification of a director for liability, as defined in 5 section 490.850, to any person for any action taken, or any 6 failure to take any action, as a director, except liability for 7 any of the following: 8 (1) Receipt of a financial benefit to which the director is 9 not entitled. 10 (2) An intentional infliction of harm on the corporation or 11 its shareholders. 12 (3) A violation of section 490.833. 13 (4) An intentional violation of criminal law. 14 f. A provision limiting or eliminating any duty of a 15 director or any other person to offer the corporation the 16 right to have or participate in any, or one or more classes 17 or categories of, business opportunities, before the pursuit 18 or taking of the opportunity by the director or other person; 19 provided that any application of such a provision to an officer 20 or a related person of that officer is subject to all of the 21 following: 22 (1) It also requires approval of that application by the 23 board of directors, subsequent to the effective date of the 24 provision, by action of qualified directors taken in compliance 25 with the same procedures as are set forth in section 490.862. 26 (2) It may be limited by the authorizing action of the 27 board. 28 3. The articles of incorporation need not set forth any of 29 the corporate powers enumerated in this chapter. 30 4. Provisions of the articles of incorporation may be made 31 dependent upon facts objectively ascertainable outside the 32 articles of incorporation in accordance with section 490.120, 33 subsection 11. 34 5. As used in this section, “related person” has the meaning 35 -37- LSB 1234HZ (1) 89 da/jh 37/ 267
H.F. 844 specified in section 490.860. 1 Sec. 28. Section 490.203, Code 2021, is amended by striking 2 the section and inserting in lieu thereof the following: 3 490.203 Incorporation. 4 1. Unless a delayed effective date is specified, the 5 corporate existence begins when the articles of incorporation 6 are filed. 7 2. The secretary of state’s filing of the articles of 8 incorporation is conclusive proof that the incorporators 9 satisfied all conditions precedent to incorporation except in a 10 proceeding by the state to cancel or revoke the incorporation 11 or involuntarily dissolve the corporation. 12 Sec. 29. Section 490.205, Code 2021, is amended by striking 13 the section and inserting in lieu thereof the following: 14 490.205 Organization of corporation. 15 1. After incorporation, the following shall apply: 16 a. If initial directors are named in the articles 17 of incorporation, the initial directors shall hold an 18 organizational meeting, at the call of a majority of the 19 directors, to complete the organization of the corporation by 20 appointing officers, adopting bylaws, and carrying on any other 21 business brought before the meeting. 22 b. If initial directors are not named in the articles of 23 incorporation, the incorporator or incorporators shall hold 24 an organizational meeting at the call of a majority of the 25 incorporators to do any of the following: 26 (1) Elect initial directors and complete the organization 27 of the corporation. 28 (2) Elect a board of directors who shall complete the 29 organization of the corporation. 30 2. Action required or permitted by this chapter to be taken 31 by incorporators at an organizational meeting may be taken 32 without a meeting if the action taken is evidenced by one or 33 more written consents describing the action taken and signed by 34 each incorporator. 35 -38- LSB 1234HZ (1) 89 da/jh 38/ 267
H.F. 844 3. An organizational meeting may be held in or out of this 1 state. 2 Sec. 30. Section 490.206, Code 2021, is amended by striking 3 the section and inserting in lieu thereof the following: 4 490.206 Bylaws. 5 1. The incorporators or board of directors of a corporation 6 shall adopt initial bylaws for the corporation. 7 2. The bylaws of a corporation may contain any provision 8 that is not inconsistent with law or the articles of 9 incorporation. 10 3. The bylaws may contain any of the following provisions: 11 a. A requirement that if the corporation solicits proxies 12 or consents with respect to an election of directors, the 13 corporation include in its proxy statement and any form 14 of its proxy or consent, to the extent and subject to such 15 procedures or conditions as are provided in the bylaws, one 16 or more individuals nominated by a shareholder in addition to 17 individuals nominated by the board of directors. 18 b. A requirement that the corporation reimburse the expenses 19 incurred by a shareholder in soliciting proxies or consents in 20 connection with an election of directors, to the extent and 21 subject to such procedures and conditions as are provided in 22 the bylaws, provided that no bylaw so adopted shall apply to 23 elections for which any record date precedes its adoption. 24 4. Notwithstanding section 490.1020, subsection 2, 25 paragraph “b” , the shareholders in amending, repealing, or 26 adopting a bylaw described in subsection 3 shall not limit the 27 authority of the board of directors to amend or repeal any 28 condition or procedure set forth in or to add any procedure 29 or condition to such a bylaw to provide for a reasonable, 30 practical, and orderly process. 31 Sec. 31. Section 490.207, Code 2021, is amended by striking 32 the section and inserting in lieu thereof the following: 33 490.207 Emergency bylaws. 34 1. Unless the articles of incorporation provide otherwise, 35 -39- LSB 1234HZ (1) 89 da/jh 39/ 267
H.F. 844 the board of directors may adopt bylaws to be effective only in 1 an emergency as defined in subsection 4. The emergency bylaws, 2 which are subject to amendment or repeal by the shareholders, 3 may make all provisions necessary for managing the corporation 4 during the emergency, including any of the following: 5 a. Procedures for calling a meeting of the board of 6 directors. 7 b. Quorum requirements for the meeting. 8 c. Designation of additional or substitute directors. 9 2. All provisions of the regular bylaws not inconsistent 10 with the emergency bylaws remain effective during the 11 emergency. The emergency bylaws are not effective after the 12 emergency ends. 13 3. Corporate action taken in good faith in accordance with 14 the emergency bylaws has all of the following effects: 15 a. The action binds the corporation. 16 b. The action shall not be used to impose liability on a 17 director, officer, employee, or agent of the corporation. 18 4. An emergency exists for purposes of this section if a 19 quorum of the board of directors cannot readily be assembled 20 because of some catastrophic event. 21 Sec. 32. NEW SECTION . 490.208 Forum selection provisions. 22 1. The articles of incorporation or bylaws may require 23 that any or all internal corporate claims shall be brought 24 exclusively in any specified court or courts of this state 25 and, if so specified, in any additional courts in this state 26 or in any other jurisdictions with which the corporation has a 27 reasonable relationship. 28 2. A provision of the articles of incorporation or bylaws 29 adopted under subsection 1 shall not have the effect of 30 conferring jurisdiction on any court or over any person or 31 claim, and shall not apply if none of the courts specified 32 by such provision has the requisite personal and subject 33 matter jurisdiction. If the court or courts of this state 34 specified in a provision adopted under subsection 1 do not 35 -40- LSB 1234HZ (1) 89 da/jh 40/ 267
H.F. 844 have the requisite personal and subject matter jurisdiction 1 and another court of this state does have such jurisdiction, 2 then the internal corporate claim may be brought in such other 3 court of this state, notwithstanding that such other court 4 of this state is not specified in such provision, and in any 5 other court specified in such provision that has the requisite 6 jurisdiction. 7 3. No provision of the articles of incorporation or bylaws 8 may prohibit bringing an internal corporate claim in the 9 courts of this state or require such claims to be determined 10 by arbitration. 11 4. “Internal corporate claim” means, for the purposes of 12 this section, any of the following: 13 a. Any claim that is based upon a violation of a duty 14 under the laws of this state by a current or former director, 15 officer, or shareholder in such capacity. 16 b. Any derivative action or proceeding brought on behalf of 17 the corporation. 18 c. Any action asserting a claim arising pursuant to any 19 provision of this chapter or the articles of incorporation or 20 bylaws. 21 d. Any action asserting a claim governed by the internal 22 affairs doctrine that is not included in paragraphs “a” through 23 “c” . 24 Sec. 33. NEW SECTION . 490.209 Foreign-trade zone 25 corporation. 26 A corporation may be organized under the laws of this state 27 for the purpose of establishing, operating, and maintaining 28 a foreign-trade zone as defined in 19 U.S.C. §81(a). A 29 corporation organized for the purposes set forth in this 30 section has all powers necessary or convenient for applying 31 for a grant of authority to establish, operate, and maintain 32 a foreign-trade zone under 19 U.S.C. §81(a) et seq., and 33 regulations promulgated under that law, and for establishing, 34 operating, and maintaining a foreign-trade zone pursuant to 35 -41- LSB 1234HZ (1) 89 da/jh 41/ 267
H.F. 844 that grant of authority. 1 Sec. 34. Section 490.302, Code 2021, is amended by striking 2 the section and inserting in lieu thereof the following: 3 490.302 General powers. 4 Unless its articles of incorporation provide otherwise, 5 every corporation has perpetual duration and succession in its 6 corporate name and has the same powers as an individual to do 7 all things necessary or convenient to carry out its business 8 and affairs, including the power to do all of the following: 9 1. Sue and be sued, complain, and defend in its corporate 10 name. 11 2. Have a corporate seal, which may be altered at will, and 12 to use it, or a facsimile of it, by impressing or affixing it or 13 in any other manner reproducing it. 14 3. Make and amend bylaws, not inconsistent with its articles 15 of incorporation or with the laws of this state, for managing 16 the business and regulating the affairs of the corporation. 17 4. Purchase, receive, lease, or otherwise acquire, and own, 18 hold, improve, use, and otherwise deal with, real or personal 19 property, or any legal or equitable interest in property, 20 wherever located. 21 5. Sell, convey, mortgage, pledge, lease, exchange, and 22 otherwise dispose of all or any part of its property. 23 6. Purchase, receive, subscribe for, or otherwise acquire, 24 own, hold, vote, use, sell, mortgage, lend, pledge, or 25 otherwise dispose of, and deal in and with shares or other 26 interests in, or obligations of, any other entity. 27 7. Make contracts and guarantees, incur liabilities, 28 borrow money, issue its notes, bonds, and other securities 29 and obligations, which may be convertible into or include the 30 option to purchase other securities of the corporation, and 31 secure any of its obligations by mortgage or pledge of any of 32 its property, franchises, or income. 33 8. Lend money, invest and reinvest its funds, and receive 34 and hold real and personal property as security for repayment. 35 -42- LSB 1234HZ (1) 89 da/jh 42/ 267
H.F. 844 9. Be a promoter, partner, member, associate, or manager of 1 any partnership, joint venture, trust, or other entity. 2 10. Conduct its business, locate offices, and exercise the 3 powers granted by this chapter within or without this state. 4 11. Elect directors and appoint officers, employees, and 5 agents of the corporation, define their duties, fix their 6 compensation, and lend them money and credit. 7 12. Pay pensions and establish pension plans, pension 8 trusts, profit sharing plans, share bonus plans, share option 9 plans, and benefit or incentive plans for any or all of its 10 current or former directors, officers, employees, and agents. 11 13. Make donations for the public welfare or for charitable, 12 scientific, or educational purposes. 13 14. Transact any lawful business that will aid governmental 14 policy. 15 15. Make payments or donations, or do any other act, not 16 inconsistent with law, that furthers the business and affairs 17 of the corporation. 18 Sec. 35. Section 490.303, Code 2021, is amended by striking 19 the section and inserting in lieu thereof the following: 20 490.303 Emergency powers. 21 1. In anticipation of or during an emergency as defined in 22 subsection 4, the board of directors of a corporation may do 23 all of the following: 24 a. Modify lines of succession to accommodate the incapacity 25 of any director, officer, employee, or agent. 26 b. Relocate the principal office, designate alternative 27 principal offices or regional offices, or authorize the 28 officers to do so. 29 2. During an emergency as defined in subsection 4, unless 30 emergency bylaws provide otherwise: 31 a. Notice of a meeting of the board of directors need be 32 given only to those directors whom it is practicable to reach 33 and may be given in any practicable manner. 34 b. One or more officers of the corporation present at a 35 -43- LSB 1234HZ (1) 89 da/jh 43/ 267
H.F. 844 meeting of the board of directors may be deemed to be directors 1 for the meeting, in order of rank and within the same rank in 2 order of seniority, as necessary to achieve a quorum. 3 3. Corporate action taken in good faith during an emergency 4 under this section to further the ordinary business affairs of 5 the corporation shall both: 6 a. Bind the corporation. 7 b. Not be used to impose liability on a corporate director, 8 officer, employee, or agent. 9 4. An emergency exists for purposes of this section if a 10 quorum of the board of directors cannot readily be assembled 11 because of some catastrophic event. 12 Sec. 36. Section 490.401, Code 2021, is amended by striking 13 the section and inserting in lieu thereof the following: 14 490.401 Corporate name. 15 1. A corporate name is subject to all of the following: 16 a. It must contain the word “corporation”, “incorporated”, 17 “company”, or “limited”, or the abbreviation “corp.”, “inc.”, 18 “co.”, or “ltd.”, or words or abbreviations of like import in 19 another language. 20 b. It must not contain language stating or implying that 21 the corporation is organized for a purpose other than that 22 permitted by section 490.301 and its articles of incorporation. 23 2. Except as authorized by subsections 3 and 4, a corporate 24 name must be distinguishable upon the records of the secretary 25 of state from all of the following: 26 a. The corporate name of a corporation incorporated in 27 this state which is not administratively dissolved, or if such 28 corporation has been administratively dissolved, within five 29 years after the effective date of dissolution. 30 b. A corporate name reserved or registered under section 31 490.402 or 490.403 or any similar provision of the law of this 32 state. 33 c. The name of a foreign corporation registered to do 34 business in this state or an alternate name adopted by a 35 -44- LSB 1234HZ (1) 89 da/jh 44/ 267
H.F. 844 foreign corporation registered to do business in this state 1 because its corporate name is unavailable. 2 d. The corporate name of a nonprofit corporation 3 incorporated in this state which is not administratively 4 dissolved. 5 e. The name of a foreign nonprofit corporation registered 6 to do business in this state or an alternate name adopted by a 7 foreign nonprofit corporation registered to conduct activities 8 in this state because its real name is unavailable. 9 f. The name of a domestic filing entity which is not 10 administratively dissolved. 11 g. The name of a foreign unincorporated entity registered 12 to do business in this state or an alternate name adopted by 13 such an entity registered to conduct activities in this state 14 because its real name is unavailable. 15 h. A name reserved, registered, or protected as follows: 16 (1) For a limited liability partnership, section 486A.1001 17 or 486A.1002. 18 (2) For a limited partnership, section 488.108, 488.109, or 19 488.810. 20 (3) For a business corporation, this section, or section 21 490.402, 490.403, or 490.1422. 22 (4) For a limited liability company under chapter 489, 23 section 489.108, 489.109, or 489.706. 24 (5) For a nonprofit corporation, section 504.401, 504.402, 25 504.403, or 504.1423. 26 3. A corporation may apply to the secretary of state for 27 authorization to use a name that is not distinguishable upon 28 the secretary of state’s records from one or more of the names 29 described in subsection 2. The secretary of state shall 30 authorize use of the name applied for if any of the following 31 conditions apply: 32 a. The other corporation or unincorporated entity consents 33 to the use in writing and submits an undertaking in form 34 satisfactory to the secretary of state to change its name to a 35 -45- LSB 1234HZ (1) 89 da/jh 45/ 267
H.F. 844 name that is distinguishable upon the records of the secretary 1 of state from the name of the applying corporation. 2 b. The applicant delivers to the secretary of state a 3 certified copy of the final judgment of a court of competent 4 jurisdiction establishing the applicant’s right to use the name 5 applied for in this state. 6 4. A corporation may use the name, including the fictitious 7 name, of another domestic or foreign corporation that is used 8 in this state if the other corporation is incorporated or 9 authorized to transact business in this state and the proposed 10 user corporation submits documentation to the satisfaction 11 of the secretary of state establishing any of the following 12 conditions: 13 a. Has merged with the other corporation. 14 b. Has been formed by reorganization of the other 15 corporation. 16 c. Has acquired all or substantially all of the assets, 17 including the corporate name, of the other corporation. 18 5. This chapter does not control the use of fictitious 19 names; however, if a corporation or a foreign corporation 20 uses a fictitious name in this state, it shall deliver to the 21 secretary of state for filing a copy of the resolution of its 22 board of directors, certified by its secretary, adopting the 23 fictitious name. 24 Sec. 37. Section 490.402, Code 2021, is amended by striking 25 the section and inserting in lieu thereof the following: 26 490.402 Reserved name. 27 1. A person may reserve the exclusive use of a corporate 28 name, including a fictitious or alternate name for a foreign 29 corporation whose corporate name is not available, by 30 delivering an application to the secretary of state for 31 filing. The application must set forth the name and address 32 of the applicant and the name proposed to be reserved. If the 33 secretary of state finds that the corporate name applied for is 34 available, the secretary of state shall reserve the name for 35 -46- LSB 1234HZ (1) 89 da/jh 46/ 267
H.F. 844 the applicant’s exclusive use for a nonrenewable one hundred 1 twenty-day period. 2 2. The owner of a reserved corporate name may transfer the 3 reservation to another person by delivering to the secretary of 4 state a signed notice of the transfer that states the name and 5 address of the transferee. 6 Sec. 38. Section 490.403, Code 2021, is amended by striking 7 the section and inserting in lieu thereof the following: 8 490.403 Registered name. 9 1. A foreign corporation may register its corporate 10 name, or its corporate name with the addition of any word 11 or abbreviation listed in section 490.401, subsection 1, 12 paragraph “a” , if necessary for the corporate name to comply 13 with section 490.401, subsection 1, paragraph “a” , if the name 14 is distinguishable upon the records of the secretary of state 15 from the corporate names that are not available under section 16 490.401, subsection 2. 17 2. A foreign corporation registers its corporate name, or 18 its corporate name with any addition permitted by subsection 19 1, by delivering to the secretary of state for filing an 20 application that complies with all of the following: 21 a. Sets forth that name, the state or country and date of 22 its incorporation, and a brief description of the nature of the 23 business which is to be conducted in this state. 24 b. Is accompanied by a certificate of existence, or a 25 document of similar import, from the state or country of 26 incorporation. 27 3. The name is registered for the applicant’s exclusive 28 use upon the effective date of the application and for the 29 remainder of the calendar year, unless renewed. 30 4. A foreign corporation whose name registration is 31 effective may renew it for successive years by delivering 32 to the secretary of state for filing a renewal application, 33 which complies with the requirements of subsection 2, between 34 October 1 and December 31 of the preceding year. The renewal 35 -47- LSB 1234HZ (1) 89 da/jh 47/ 267
H.F. 844 application when filed renews the registration for the 1 following calendar year. 2 5. a. A foreign corporation whose name registration is 3 effective may thereafter do any of the following: 4 (1) Register to do business as a foreign corporation under 5 the registered name, if it complies with section 490.401, 6 subsection 1, paragraph “b” . 7 (2) Consent in writing to the use of that name by a domestic 8 corporation thereafter incorporated under this chapter or by 9 another foreign corporation. 10 b. The registration terminates when the domestic corporation 11 is incorporated or the foreign corporation registers to do 12 business under that name. 13 Sec. 39. Section 490.501, Code 2021, is amended by striking 14 the section and inserting in lieu thereof the following: 15 490.501 Registered office and agent of domestic and 16 registered foreign corporations. 17 1. Each corporation shall continuously maintain in this 18 state all of the following: 19 a. A registered office that may be the same as any of its 20 places of business. 21 b. A registered agent, which may be any of the following: 22 (1) An individual who resides in this state and whose 23 business office is identical with the registered office. 24 (2) A domestic or foreign corporation or eligible entity 25 whose business office is identical with the registered office 26 and, in the case of a foreign corporation or foreign eligible 27 entity, is registered to do business in this state. 28 2. As used in this subchapter, “corporation” means both a 29 domestic corporation and a registered foreign corporation. 30 Sec. 40. Section 490.502, Code 2021, is amended by striking 31 the section and inserting in lieu thereof the following: 32 490.502 Change of registered office or registered agent. 33 1. A corporation may change its registered office or 34 registered agent by delivering to the secretary of state 35 -48- LSB 1234HZ (1) 89 da/jh 48/ 267
H.F. 844 for filing a statement of change that sets forth all of the 1 following: 2 a. The name of the corporation. 3 b. The street and mailing addresses of its current 4 registered office. 5 c. If the current registered office is to be changed, the 6 street and mailing addresses of the new registered office. 7 d. The name of its current registered agent. 8 e. If the current registered agent is to be changed, the 9 name of the new registered agent and the new agent’s written 10 consent, either on the statement or attached to it, to the 11 appointment. 12 f. That after the change or changes are made, the street and 13 mailing addresses of its registered office and of the business 14 office of its registered agent will be identical. 15 2. If the street or mailing address of a registered agent’s 16 business office changes, the agent shall change the street or 17 mailing address of the registered office of any corporation for 18 which the agent is the registered agent by delivering a signed 19 written notice of the change to the corporation and delivering 20 to the secretary of state for filing a signed statement that 21 complies with the requirements of subsection 1 and states that 22 the corporation has been notified of the change. 23 3. If a registered agent changes the registered agent’s 24 business address to another place, the registered agent may 25 change the business address and the address of the registered 26 agent by filing a statement as required in subsection 2 for 27 each corporation, or a single statement for all corporations 28 named in the notice, except that it need be signed only by the 29 registered agent and need not be responsive to subsection 1, 30 paragraph “e” , and must recite that a copy of the statement has 31 been mailed to each corporation named in the notice. 32 4. A corporation may also change its registered office or 33 registered agent in its biennial report as provided in section 34 490.1622. 35 -49- LSB 1234HZ (1) 89 da/jh 49/ 267
H.F. 844 Sec. 41. Section 490.503, Code 2021, is amended by striking 1 the section and inserting in lieu thereof the following: 2 490.503 Resignation of registered agent. 3 1. A registered agent may resign as agent for a corporation 4 by delivering to the secretary of state for filing a statement 5 of resignation signed by the agent which shall state all of the 6 following: 7 a. The name of the corporation. 8 b. The name of the agent. 9 c. The agent resigns from serving as registered agent for 10 the corporation. 11 d. The address of the corporation to which the agent will 12 deliver the notice required by subsection 3. 13 2. A statement of resignation takes effect on the earlier 14 of the following: 15 a. 12:01 a.m. on the thirty-first day after the day on which 16 it is filed by the secretary of state. 17 b. The designation of a new registered agent for the 18 corporation. 19 3. A registered agent promptly shall deliver to the 20 corporation notice of the date on which a statement of 21 resignation was delivered to the secretary of state for filing. 22 4. When a statement of resignation takes effect, the person 23 that resigned ceases to have responsibility under this chapter 24 for any matter thereafter tendered to it as agent for the 25 corporation. The resignation does not affect any contractual 26 rights the corporation has against the agent or that the agent 27 has against the corporation. 28 5. A registered agent may resign with respect to a 29 corporation regardless of whether the corporation is in good 30 standing. 31 Sec. 42. Section 490.504, Code 2021, is amended by striking 32 the section and inserting in lieu thereof the following: 33 490.504 Service on corporation. 34 1. A corporation’s registered agent is the corporation’s 35 -50- LSB 1234HZ (1) 89 da/jh 50/ 267
H.F. 844 agent for service of process, notice, or demand required or 1 permitted by law to be served on the corporation. 2 2. If a corporation has no registered agent, or the agent 3 cannot with reasonable diligence be served, the corporation 4 may be served by registered or certified mail, return receipt 5 requested, addressed to the secretary at the corporation’s 6 principal office. Service is perfected under this subsection 7 at the earliest of the following: 8 a. The date the corporation receives the mail. 9 b. The date shown on the return receipt, if signed on behalf 10 of the corporation. 11 c. Five days after its deposit in the United States mail, 12 as evidenced by the postmark, if mailed postpaid and correctly 13 addressed. 14 3. a. The secretary of state shall be an agent of the 15 corporation upon whom process, notice, or demand may be served, 16 if any of the following applies: 17 (1) The process, notice, or demand cannot be served on a 18 corporation pursuant to subsection 1 or 2. 19 (2) The process, notice, or demand is to be served on 20 a registered foreign corporation that has withdrawn its 21 registration pursuant to section 490.1507 or 490.1509, or the 22 registration of which has been terminated pursuant to section 23 490.1511. 24 b. Service of any process, notice, or demand on the 25 secretary of state as agent for a corporation may be made by 26 delivering to the secretary of state duplicate copies of the 27 process, notice, or demand. If process, notice, or demand 28 is served on the secretary of state, the secretary of state 29 shall forward one of the copies by registered or certified 30 mail, return receipt requested, to the corporation at the 31 last address shown in the records of the secretary of state. 32 Service is effected under this subsection at the earliest of 33 the following: 34 (1) The date the corporation receives the process, notice, 35 -51- LSB 1234HZ (1) 89 da/jh 51/ 267
H.F. 844 or demand. 1 (2) The date shown on the return receipt, if signed on 2 behalf of the corporation. 3 (3) Five days after the process, notice, or demand is 4 deposited with the United States mail by the secretary of 5 state. 6 4. This section does not prescribe the only means, or 7 necessarily the required means, of serving a corporation. 8 Sec. 43. Section 490.601, Code 2021, is amended by striking 9 the section and inserting in lieu thereof the following: 10 490.601 Authorized shares. 11 1. The articles of incorporation must set forth any classes 12 of shares and series of shares within a class, and the number 13 of shares of each class and series, that the corporation is 14 authorized to issue. If more than one class or series of 15 shares is authorized, the articles of incorporation must 16 prescribe a distinguishing designation for each class or series 17 and, before the issuance of shares of a class or series, 18 describe the terms, including the preferences, rights, and 19 limitations of that class or series. Except to the extent 20 varied as permitted by this section, all shares of a class or 21 series must have terms, including preferences, rights, and 22 limitations that are identical with those of other shares of 23 the same class or series. 24 2. The articles of incorporation must authorize all of the 25 following: 26 a. One or more classes or series of shares that together 27 have full voting rights. 28 b. One or more classes or series of shares, which may be 29 the same class, classes, or series as those with voting rights, 30 that together are entitled to receive the net assets of the 31 corporation upon dissolution. 32 3. The articles of incorporation may authorize one or more 33 classes or series of shares that have any of the following 34 characteristics: 35 -52- LSB 1234HZ (1) 89 da/jh 52/ 267
H.F. 844 a. Have special, conditional, or limited voting rights, or 1 no right to vote, except to the extent otherwise provided by 2 this chapter. 3 b. Are redeemable or convertible as specified in the 4 articles of incorporation in any of the following ways: 5 (1) At the option of the corporation, the shareholder, or 6 another person or upon the occurrence of a specified event. 7 (2) For cash, indebtedness, securities, or other property. 8 (3) At prices and in amounts specified or determined in 9 accordance with a formula. 10 c. Entitle the holders to distributions calculated in 11 any manner, including dividends that may be cumulative, 12 noncumulative, or partially cumulative. 13 d. Have preference over any other class or series of shares 14 with respect to distributions, including distributions upon the 15 dissolution of the corporation. 16 4. The terms of shares may be made dependent upon facts 17 objectively ascertainable outside the articles of incorporation 18 in accordance with section 490.120, subsection 11. 19 5. Any of the terms of shares may vary among holders of the 20 same class or series so long as such variations are expressly 21 set forth in the articles of incorporation. 22 6. The description of the preferences, rights, and 23 limitations of classes or series of shares in subsection 3 is 24 not exhaustive. 25 Sec. 44. Section 490.602, Code