House
Study
Bill
630
-
Introduced
HOUSE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
JUDICIARY
BILL
BY
CHAIRPERSON
HOLT)
A
BILL
FOR
An
Act
relating
to
corporations
by
providing
for
the
use
of
1
electronic
mail
and
other
electronic
transmissions,
and
2
shareholders’
lists.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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5272YC
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H.F.
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DIVISION
I
1
SHAREHOLDER
NOTICES,
LISTS,
AND
RECORDS
2
Section
1.
Section
490.140,
Code
2022,
is
amended
by
adding
3
the
following
new
subsections:
4
NEW
SUBSECTION
.
12A.
“Electronic
mail”
means
an
electronic
5
transmission
directed
to
a
unique
electronic
mail
address.
6
NEW
SUBSECTION
.
12B.
“Electronic
mail
address”
means
a
7
destination,
commonly
expressed
as
a
string
of
characters,
8
consisting
of
a
unique
user
name
or
mailbox,
commonly
referred
9
to
as
the
“local
part”
of
the
address,
and
a
reference
to
an
10
internet
domain,
commonly
referred
to
as
the
“domain
part”
of
11
the
address,
whether
or
not
displayed,
to
which
electronic
mail
12
may
be
sent
or
delivered.
13
Sec.
2.
Section
490.141,
Code
2022,
is
amended
to
read
as
14
follows:
15
490.141
Notices
and
other
communications.
16
1.
A
notice
under
this
chapter
must
be
in
writing
unless
17
oral
notice
is
reasonable
in
the
circumstances.
Unless
18
otherwise
agreed
between
the
sender
and
the
recipient,
words
19
in
a
notice
or
other
communication
under
this
chapter
must
be
20
in
English.
21
2.
A
notice
or
other
communication
may
be
given
by
22
any
method
of
delivery,
except
that
a
notice
or
other
23
communication
by
electronic
transmissions
transmission
must
be
24
in
accordance
with
this
section
.
If
the
methods
of
delivery
25
are
impracticable,
a
notice
or
other
communication
from
a
26
corporation
may
be
given
by
means
of
a
broad
nonexclusionary
27
distribution
to
the
public,
which
may
include
a
newspaper
28
of
general
circulation
in
the
area
where
published;
radio,
29
television,
or
other
form
of
public
broadcast
communication;
30
or
other
methods
of
distribution
that
the
corporation
has
31
previously
identified
to
its
shareholders.
32
3.
A
notice
or
other
communication
to
a
domestic
corporation
33
or
to
a
registered
foreign
corporation
registered
to
do
34
business
in
this
state
may
be
delivered
to
the
corporation’s
35
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registered
agent
at
its
registered
office
or
to
the
secretary
1
at
the
corporation’s
principal
office
shown
in
its
most
recent
2
biennial
report
required
by
section
490.1621
or,
in
the
case
3
of
a
foreign
corporation
that
has
not
yet
delivered
a
biennial
4
report,
in
its
foreign
registration
statement.
5
4.
A
notice
or
other
communication
from
a
corporation
6
to
a
shareholder
may
be
delivered
by
electronic
mail
to
the
7
electronic
mail
address
for
a
shareholder
required
to
be
8
included
in
the
record
of
shareholders
maintained
pursuant
9
to
section
490.1601,
subsection
4,
unless
the
shareholder
10
has
previously
notified
the
corporation
in
writing
that
11
the
shareholder
objects
to
receiving
notices
and
other
12
communication
by
electronic
mail.
Any
notice
or
other
13
communication
may
be
delivered
to
a
shareholder
by
another
form
14
of
electronic
transmission
if
consented
to
by
the
shareholder
15
or
if
authorized
by
subsection
10.
Any
notice
or
other
16
communication
from
the
corporation
to
any
other
person
may
be
17
delivered
by
electronic
transmission
if
consented
to
by
the
18
recipient
or
if
authorized
by
subsection
10
.
19
5.
Any
consent
given
under
this
subsection
4
or
subsection
20
10
may
be
revoked
with
respect
to
future
notices
or
21
communications
by
the
person
who
consented
by
giving
written
22
or
electronic
notice
to
the
person
to
whom
the
consent
was
23
delivered.
Any
such
consent
is
deemed
revoked
24
5.
A
notice
or
other
communication
shall
no
longer
be
25
delivered
to
an
electronic
mail
address
or
other
electronic
26
transmission
address
pursuant
to
subsection
4,
if
all
of
the
27
following
apply:
28
a.
The
corporation
is
unable
to
deliver
two
consecutive
29
electronic
transmissions
given
by
the
corporation
in
30
accordance
with
such
consent
receives
notice
from
the
31
information
processing
system
into
which
such
notice
or
other
32
communication
was
entered
that
two
consecutive
notices
or
33
other
communications
given
by
electronic
transmission
have
34
not
been
delivered
to
the
electronic
mail
address
or
other
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electronic
transmission
address
to
which
such
notice
or
other
1
communication
was
directed
.
2
b.
Such
inability
notice
of
nondelivery
becomes
known
to
the
3
secretary
,
or
an
assistant
secretary
or
to
the
transfer
agent,
4
or
other
another
person
responsible
for
the
giving
of
notice
5
notices
or
other
communications
for
the
corporation
;
provided,
6
however,
that
the
inadvertent
failure
to
treat
such
inability
7
as
a
revocation
recognize
such
notice
of
nondelivery
as
a
8
cessation
of
authority
to
provide
a
shareholder
with
notice
9
by
electronic
mail
or
other
electronic
transmission
shall
not
10
invalidate
any
meeting
or
other
action.
11
6.
Unless
otherwise
agreed
between
the
sender
and
the
12
recipient,
an
a
notice
or
other
communication
by
electronic
13
transmission
is
received
when
all
of
the
following
apply:
14
a.
The
electronic
transmission
enters
an
information
15
processing
system
that
the
recipient
has
designated
or
uses
16
for
the
purposes
of
receiving
electronic
transmissions
or
17
information
of
the
type
sent,
and
from
which
the
recipient
is
18
able
to
retrieve
the
directed
to
any
of
the
following:
19
(1)
In
the
case
of
a
shareholder,
the
electronic
mail
20
address
for
the
shareholder
required
to
be
included
in
the
21
record
of
shareholders
maintained
pursuant
to
section
490.1601,
22
subsection
4,
or
other
electronic
transmission
address
at
23
which
the
shareholder
has
consented
to
receive
notice
or
other
24
communications
by
electronic
transmission
.
25
(2)
In
the
case
of
any
other
recipient,
the
electronic
26
transmission
address
at
which
the
recipient
has
consented
27
to
receive
notice
or
other
communications
by
electronic
28
transmission.
29
b.
The
electronic
transmission
is
in
a
form
capable
of
being
30
processed
by
that
system.
31
7.
Receipt
of
an
electronic
acknowledgment
from
an
32
information
processing
system
described
in
subsection
6
,
33
paragraph
“a”
,
establishes
that
an
electronic
transmission
was
34
received
but,
by
itself,
does
not
establish
that
the
content
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sent
corresponds
to
the
content
received.
1
8.
An
electronic
transmission
is
received
under
this
2
section
even
if
no
person
is
aware
of
its
receipt.
3
9.
A
notice
or
other
communication,
if
in
a
comprehensible
4
form
or
manner,
is
effective
at
the
earliest
of
the
following:
5
a.
If
in
a
physical
form,
the
earliest
of
when
it
is
6
actually
received,
or
when
it
is
left
at
any
of
the
following:
7
(1)
A
shareholder’s
address
shown
on
included
in
the
8
corporation’s
record
of
shareholders
maintained
by
the
9
corporation
under
pursuant
to
section
490.1601,
subsection
4
.
10
(2)
A
director’s
residence
or
usual
place
of
business.
11
(3)
The
domestic
or
registered
foreign
corporation’s
12
principal
office.
13
b.
If
mailed
by
United
States
mail
postage
prepaid
and
14
correctly
addressed
to
a
shareholder
at
the
shareholder’s
15
address
included
in
the
record
of
shareholders
pursuant
to
16
section
490.1601,
subsection
4
,
upon
deposit
in
the
United
17
States
mail.
18
c.
If
mailed
by
United
States
mail
postage
prepaid
and
19
correctly
addressed
to
a
recipient
other
than
a
shareholder,
at
20
the
address
included
in
the
corporation’s
records
the
earliest
21
of
when
it
is
actually
received,
or
as
follows:
22
(1)
If
sent
by
registered
or
certified
mail,
return
receipt
23
requested,
the
date
shown
on
the
return
receipt
signed
by
or
on
24
behalf
of
the
addressee.
25
(2)
Five
days
after
it
is
deposited
in
the
United
States
26
mail.
27
d.
If
an
electronic
transmission,
when
it
is
received
as
28
provided
in
subsection
6
.
29
e.
If
oral,
when
communicated.
30
10.
A
notice
or
other
communication
may
be
in
the
form
of
31
an
electronic
transmission
that
cannot
be
directly
reproduced
32
in
paper
form
by
the
recipient
through
an
automated
process
33
used
in
conventional
commercial
practice
only
if
all
of
the
34
following
apply:
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a.
The
electronic
transmission
is
otherwise
retrievable
in
1
perceivable
form.
2
b.
The
sender
and
the
recipient
have
consented
in
writing
to
3
the
use
of
such
form
of
electronic
transmission.
4
11.
If
this
chapter
prescribes
requirements
for
notices
5
or
other
communications
in
particular
circumstances,
those
6
requirements
govern.
If
articles
of
incorporation
or
bylaws
7
prescribe
requirements
for
notices
or
other
communications,
8
not
inconsistent
with
this
section
or
other
provisions
of
9
this
chapter
,
those
requirements
govern.
The
articles
of
10
incorporation
or
bylaws
may
authorize
or
require
delivery
of
11
notices
of
meetings
of
directors
by
electronic
transmission.
12
12.
In
the
event
that
any
provisions
of
this
chapter
are
13
deemed
to
modify,
limit,
or
supersede
the
federal
Electronic
14
Signatures
in
Global
and
National
Commerce
Act,
15
U.S.C.
15
§§7001
§7001
et
seq.,
the
provisions
of
this
chapter
shall
16
control
to
the
maximum
extent
permitted
by
section
102(a)(2)
of
17
that
federal
Act.
18
13.
a.
Whenever
notice
would
otherwise
be
required
to
19
be
given
under
any
provision
of
this
subchapter
chapter
20
to
a
shareholder,
such
the
notice
need
not
be
given
if
the
21
corporation
is
not
permitted
to
deliver
notice
by
electronic
22
transmission
pursuant
to
subsections
4
and
5
and
any
of
the
23
following
apply:
24
(1)
Notices
to
the
shareholders
of
two
consecutive
annual
25
meetings,
and
all
notices
of
meetings
during
the
period
26
between
such
two
consecutive
annual
meetings,
have
been
sent
27
to
such
shareholder
at
such
shareholder’s
address
as
shown
28
on
the
records
of
the
corporation
included
in
the
record
29
of
shareholders
maintained
pursuant
to
section
490.1601,
30
subsection
4,
and
have
been
returned
undeliverable
or
could
not
31
be
delivered.
32
(2)
All,
but
not
less
than
two,
payments
of
dividends
on
33
securities
during
a
twelve-month
period,
or
two
consecutive
34
payments
of
dividends
on
securities
during
a
period
of
more
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than
twelve
months,
have
been
sent
to
such
shareholder
at
1
such
shareholder’s
address
as
shown
on
the
records
of
the
2
corporation
included
in
the
record
of
shareholders
maintained
3
pursuant
to
section
490.1601,
subsection
4,
and
have
been
4
returned
undeliverable
or
could
not
be
delivered.
5
(a)
No
address
has
been
provided
to
the
corporation
by
or
on
6
behalf
of
a
shareholder
and
the
corporation
has
not
otherwise
7
obtained
an
address
for
the
shareholder
that
the
corporation
8
believes
is
reliable.
9
b.
If
In
addition,
if
any
such
shareholder
shall
deliver
10
to
which
this
subsection
applies
delivers
to
the
corporation
a
11
written
notice
setting
forth
such
shareholder’s
then-current
12
address,
the
requirement
that
notice
be
given
to
such
13
shareholder
shall
be
reinstated.
14
Sec.
3.
Section
490.720,
Code
2022,
is
amended
to
read
as
15
follows:
16
490.720
Shareholders’
list
List
of
shareholders
for
meeting.
17
1.
After
fixing
a
record
date
for
a
meeting,
a
corporation
18
shall
prepare
an
alphabetical
list
of
the
names
of
all
its
the
19
shareholders
who
are
entitled
to
notice
of
a
the
shareholders’
20
meeting.
If
the
board
of
directors
fixes
a
different
record
21
date
under
section
490.707,
subsection
5
,
to
determine
the
22
shareholders
entitled
to
vote
at
the
meeting,
a
corporation
23
also
shall
prepare
an
alphabetical
list
of
the
names
of
24
all
its
the
shareholders
who
are
entitled
to
vote
at
the
25
meeting.
A
The
list
must
be
arranged
by
voting
group
,
and
26
within
each
voting
group
by
class
or
series
of
shares,
and
27
show
contain
the
address
of
,
and
number
and
class
or
series
28
of
shares
held
by
,
each
shareholder
.
Nothing
contained
in
29
this
subsection
shall
require
and,
if
the
notice
or
other
30
communications
regarding
the
meeting
has
been
or
will
be
sent
31
by
the
corporation
to
include
on
such
list
the
a
shareholder
by
32
electronic
mail
address
or
other
electronic
contact
information
33
of
a
transmission,
the
electronic
mail
or
other
electronic
34
transmission
address
of
that
shareholder.
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2.
a.
The
shareholders’
list
for
of
shareholders
entitled
1
to
notice
shall
be
available
for
inspection
by
any
shareholder,
2
beginning
two
business
days
after
notice
of
the
meeting
is
3
given
for
which
the
list
was
prepared
and
continuing
through
4
the
meeting.
The
shareholders’
list
list
of
shareholders
for
5
notice
shall
be
made
available
at
via
any
of
the
following:
6
(1)
The
At
the
corporation’s
principal
office
or
at
a
place
7
identified
in
the
meeting
notice
in
the
city
where
the
meeting
8
will
be
held.
9
(2)
A
On
a
reasonably
accessible
electronic
network,
10
provided
that
the
information
required
to
gain
access
to
such
11
list
is
provided
with
the
notice
of
the
meeting.
The
list
of
12
shareholders
entitled
to
vote
shall
be
similarly
available
13
for
inspection
promptly
after
the
record
date
for
voting.
In
14
the
event
that
the
corporation
determines
to
make
the
list
15
available
on
an
electronic
network,
the
corporation
may
take
16
reasonable
steps
to
ensure
that
such
information
is
available
17
only
to
shareholders
of
the
corporation.
18
b.
A
shareholders’
list
for
voting
shall
be
similarly
19
available
for
inspection
promptly
after
the
record
date
for
20
voting.
A
shareholder,
or
the
shareholder’s
agent
or
attorney,
21
is
entitled
on
written
demand
to
inspect
and,
subject
to
the
22
requirements
of
section
490.1602,
subsection
3
,
to
copy
a
23
list
of
shareholders
,
during
regular
business
hours
and
at
24
the
shareholder’s
expense,
during
the
period
it
is
available
25
for
inspection.
A
corporation
may
satisfy
the
shareholder’s
26
right
to
copy
a
list
of
shareholders
by
furnishing
a
copy
27
in
the
manner
described
in
section
490.1603,
subsection
2.
28
A
shareholder
and
the
shareholder’s
agent
or
attorney
who
29
inspects
or
is
furnished
a
copy
of
a
list
of
shareholders
under
30
this
subsection
or
under
subsection
3
or
who
copies
the
list
31
under
this
subsection
may
use
the
information
on
that
list
only
32
for
purposes
related
to
the
meeting
and
its
subject
matter
and
33
must
keep
the
information
on
that
list
confidential.
34
3.
If
the
meeting
is
to
be
held
at
a
place,
the
corporation
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shall
make
the
list
of
shareholders
entitled
to
vote
available
1
at
the
meeting
and
any
adjournment
,
and
any
shareholder,
or
the
2
shareholder’s
agent
or
attorney,
is
entitled
to
inspect
the
3
list
at
any
time
during
the
meeting
or
and
any
adjournment.
4
If
the
meeting
is
to
be
held
solely
by
means
of
remote
5
communication,
then
such
list
shall
also
be
open
to
available
6
for
such
inspection
during
the
meeting
and
any
adjournment
on
a
7
reasonably
accessible
electronic
network,
and
the
information
8
required
to
access
such
list
shall
be
provided
with
the
notice
9
of
the
meeting.
The
corporation
may
satisfy
its
obligation
10
to
make
such
list
available
for
inspection
during
a
meeting
11
by
furnishing
a
copy
of
the
list
in
the
manner
described
in
12
section
490.1603,
subsection
2,
to
the
shareholders
prior
to
13
the
meeting.
14
4.
If
the
corporation
refuses
to
allow
a
shareholder,
or
15
the
shareholder’s
agent
or
attorney,
to
inspect
a
shareholders’
16
list
of
shareholders
before
or
at
the
meeting
or
any
17
adjournment
,
or
copy
a
list
as
permitted
by
subsection
2
,
the
18
district
court
of
the
county
where
a
corporation’s
principal
19
office
or,
if
none
in
this
state,
its
registered
office,
is
20
located,
on
application
of
the
shareholder,
may
summarily
order
21
the
inspection
or
copying
at
the
corporation’s
expense
and
may
22
postpone
the
meeting
for
which
the
list
was
prepared
until
the
23
inspection
or
copying
is
complete.
24
5.
Refusal
or
failure
to
prepare
or
make
available
the
25
shareholders’
list
of
shareholders
does
not
affect
the
validity
26
of
action
taken
at
the
meeting.
27
Sec.
4.
Section
490.1601,
subsection
4,
Code
2022,
is
28
amended
to
read
as
follows:
29
4.
A
corporation
shall
maintain
a
record
of
its
current
30
shareholders
in
alphabetical
order
by
class
or
series
of
shares
31
showing
the
address
of
,
and
the
number
and
class
or
series
of
32
shares
held
by,
each
shareholder
to
which
notices
and
other
33
communications
from
the
corporation
are
to
be
sent,
and
which
34
shall
include
the
number
and
class
or
series
of
shares
held
by
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each
such
shareholder
.
Nothing
contained
in
this
subsection
1
shall
require
the
corporation
to
include
in
such
record
the
2
electronic
mail
address
or
other
electronic
contact
information
3
of
In
addition,
if
a
shareholder
has
provided
an
electronic
4
mail
address
to
the
corporation
or
has
consented
to
receive
5
notices
or
other
communications
by
electronic
mail
or
other
6
electronic
transmission,
the
record
of
shareholders
shall
7
include
the
electronic
mail
or
other
electronic
transmission
8
address
of
the
shareholder
if
notices
or
other
communications
9
are
being
delivered
by
the
corporation
to
the
shareholder
at
10
such
electronic
mail
or
other
electronic
transmission
address
11
pursuant
to
section
490.141,
subsection
4.
An
electronic
12
mail
address
of
a
shareholder
shall
be
deemed
to
be
provided
13
by
a
shareholder
if
the
electronic
mail
address
is
contained
14
in
a
communication
to
the
corporation
by
or
on
behalf
of
15
the
shareholder
unless
the
communication
expressly
indicates
16
that
the
electronic
mail
address
shall
not
be
used
to
deliver
17
notices
or
other
communications
.
18
DIVISION
II
19
GRAMMATICAL
CHANGES
20
Sec.
5.
Section
490.140,
subsection
57,
Code
2022,
is
21
amended
to
read
as
follows:
22
57.
“United
States”
includes
a
district,
authority,
bureau,
23
commission,
department,
and
any
other
agency
of
the
United
24
States.
25
Sec.
6.
Section
490.143,
subsection
1,
paragraph
e,
26
subparagraph
(2),
Code
2022,
is
amended
to
read
as
follows:
27
(2)
Has
a
material
relationship
with
a
director
or
officer
28
who
pursues
or
takes
advantage
of
the
business
opportunity,
29
directly
,
or
indirectly
through
or
on
behalf
of
another
person.
30
Sec.
7.
Section
490.1704,
subsection
4,
Code
2022,
is
31
amended
to
read
as
follows:
32
4.
Unless
otherwise
provided
in
the
articles
of
33
incorporation,
the
violation
by
a
director
of
the
duties
34
imposed
by
subsections
1
and
2
shall
not
constitute
an
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intentional
infliction
of
harm
on
the
corporation
or
the
1
shareholders
for
the
purposes
of
sections
section
490.202,
2
subsection
2
,
paragraphs
“d”
and
“e”
.
3
DIVISION
III
4
TERMINOLOGY
CHANGES
5
Sec.
8.
Section
490.120,
subsection
5,
Code
2022,
is
amended
6
to
read
as
follows:
7
5.
The
document
must
be
in
the
English
language.
A
8
corporate
name
need
not
be
in
English
if
written
in
English
9
letters
or
Arabic
or
Roman
numerals,
and
the
certificate
of
10
existence
registration
required
of
foreign
corporations
need
11
not
be
in
English
if
accompanied
by
a
reasonably
authenticated
12
English
translation.
13
Sec.
9.
Section
490.401,
subsection
2,
paragraphs
c
and
e,
14
Code
2022,
are
amended
to
read
as
follows:
15
c.
The
name
of
a
registered
foreign
corporation
registered
16
to
do
business
in
this
state
or
an
alternate
name
adopted
by
17
a
registered
foreign
corporation
registered
to
do
business
in
18
this
state
because
its
corporate
name
is
unavailable.
19
e.
The
name
of
a
foreign
nonprofit
corporation
registered
20
authorized
to
do
business
in
this
state
or
an
alternate
21
name
adopted
by
a
foreign
nonprofit
corporation
registered
22
authorized
to
conduct
activities
in
this
state
because
its
real
23
name
is
unavailable.
24
Sec.
10.
Section
490.401,
subsection
4,
unnumbered
25
paragraph
1,
Code
2022,
is
amended
to
read
as
follows:
26
A
corporation
may
use
the
name,
including
the
fictitious
27
name,
of
another
domestic
or
foreign
corporation
that
is
used
28
in
this
state
if
the
other
corporation
is
incorporated
or
29
authorized
registered
to
transact
do
business
in
this
state
30
and
the
proposed
user
corporation
submits
documentation
to
the
31
satisfaction
of
the
secretary
of
state
establishing
any
of
the
32
following
conditions:
33
Sec.
11.
Section
490.748,
subsection
3,
Code
2022,
is
34
amended
to
read
as
follows:
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3.
The
district
court
may
appoint
an
individual
or
domestic
1
or
registered
foreign
corporation
,
registered
to
do
business
2
in
this
state,
as
a
custodian
or
receiver
and
may
require
the
3
custodian
or
receiver
to
post
bond,
with
or
without
sureties,
4
in
an
amount
the
district
court
directs.
5
Sec.
12.
Section
490.922,
subsection
5,
Code
2022,
is
6
amended
to
read
as
follows:
7
5.
If
the
domesticating
corporation
is
a
registered
8
foreign
corporation
that
is
registered
to
do
business
in
this
9
state
under
subchapter
XV
,
its
registration
statement
shall
10
be
canceled
automatically
when
the
domestication
becomes
11
effective.
12
Sec.
13.
Section
490.1511,
subsection
4,
Code
2022,
is
13
amended
to
read
as
follows:
14
4.
The
registration
of
a
registered
foreign
corporation
15
to
do
business
in
this
state
ceases
on
the
effective
date
16
of
the
termination
as
set
forth
in
the
certificate
of
17
termination,
unless
before
that
date
the
foreign
corporation
18
cures
each
ground
for
termination
stated
in
the
certificate
of
19
termination.
If
the
foreign
corporation
cures
each
ground,
the
20
secretary
of
state
shall
file
a
statement
that
the
certificate
21
of
termination
is
withdrawn.
22
Sec.
14.
Section
490.1621,
subsection
4,
Code
2022,
is
23
amended
to
read
as
follows:
24
4.
The
first
biennial
report
shall
be
delivered
to
the
25
secretary
of
state
between
January
1
and
April
1
of
the
first
26
even-numbered
year
following
the
calendar
year
in
which
a
27
domestic
corporation
was
incorporated
or
a
foreign
corporation
28
was
authorized
to
transact
registered
to
do
business
in
this
29
state
.
Subsequent
biennial
reports
must
be
delivered
to
30
the
secretary
of
state
between
January
1
and
April
1
of
the
31
following
even-numbered
calendar
years.
For
purposes
of
this
32
section
,
each
biennial
report
shall
contain
information
related
33
to
the
two-year
period
immediately
preceding
the
calendar
year
34
in
which
the
report
is
filed.
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EXPLANATION
1
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
2
the
explanation’s
substance
by
the
members
of
the
general
assembly.
3
BACKGROUND.
This
bill
amends
provisions
in
the
Iowa
4
business
corporation
Act
(IBCA)
(Code
chapter
490)
as
5
revised
in
HF
844
(2021
Iowa
Acts,
chapter
165)
based
on
6
recommendations
by
the
American
bar
association
and
published
7
as
the
2016
revised
version
of
the
“Model
Business
Corporation
8
Act”
(MBCA).
The
bill
includes
later
additions
to
the
MBCA
9
relating
to
the
use
of
electronic
transmission
to
deliver
and
10
receive
communications
between
a
corporation
and
shareholders.
11
The
bill
also
makes
changes
to
the
use
of
grammar
in
provisions
12
enacted
in
HF
844
and
the
terminology
used
in
the
MBCA
and
13
enacted
in
HF
844
to
enhance
the
IBCA’s
readability.
14
DIVISION
I
——
NOTICES
AND
OTHER
COMMUNICATION.
The
bill
15
defines
electronic
mail
(email)
as
any
electronic
transmission
16
directed
to
a
unique
electronic
mail
address
(amended
Code
17
section
490.140(12A),
(12B)).
The
use
of
other
forms
of
18
electronic
transmission
is
also
allowed.
The
exception
for
a
19
corporation’s
use
of
electronic
transmission,
including
email,
20
to
communicate
with
a
shareholder
is
the
shareholder’s
written
21
objection
(amended
Code
section
490.140(4)).
The
corporation
22
must
also
cease
using
this
form
of
communication
if
it
receives
23
a
message
that
the
electronic
transmission
could
not
be
24
delivered
(amended
Code
section
490.140(5)).
25
DIVISION
I
——
LIST
OF
SHAREHOLDERS.
The
phrase
26
“shareholders’
list”
refers
to
a
register
of
all
active
owners
27
of
the
corporation’s
shares
which
the
corporation
must
keep
28
current.
The
bill
changes
the
name
to
“list
of
shareholders”.
29
The
bill
provides
that
if
a
communication
regarding
a
meeting
30
has
been
sent
by
the
corporation
to
the
shareholder
by
email
31
or
other
electronic
transmission,
the
address
of
the
email
or
32
other
electronic
transmission
must
be
included
as
part
of
the
33
list
(amended
Code
section
490.720(1)).
The
bill
also
provides
34
that
a
corporation
may
comply
with
its
obligation
to
make
the
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list
available
for
inspection
by
providing
a
copy
of
the
list
1
prior
to
meeting;
the
list
is
often
used
for
the
restricted
2
use
of
protecting
shareholder
rights
(amended
Code
section
3
490.720(2)).
4
DIVISION
I
——
RECORD
OF
SHAREHOLDERS.
The
corporation
is
5
required
to
maintain
a
record
of
shareholders
which
is
the
6
basis
for
providing
communications
to
shareholders.
If
a
7
shareholder
provides
an
email
address
to
the
corporation
or
has
8
consented
to
receive
communication
by
electronic
transmission,
9
the
record
must
include
the
email
or
other
electronic
10
transmission
address
of
the
shareholder
(amended
Code
section
11
490.1601(4)).
In
these
cases,
the
electronic
mail
address
12
or
other
electronic
transmission
address
of
a
shareholder
is
13
deemed
to
be
provided
by
a
shareholder
to
the
corporation
14
if
it
is
contained
in
a
communication
to
the
corporation
by
15
or
on
behalf
of
the
shareholder,
unless
the
shareholder’s
16
communication
expressly
indicates
otherwise.
17
DIVISION
II
——
GRAMMATICAL
CHANGES.
The
bill
amends
several
18
provisions
to
correspond
to
modern
rules
of
grammar,
including
19
the
proper
use
of
an
indefinite
article,
a
comma,
and
the
20
singular
(amended
Code
sections
490.140(57),
490.143(1),
and
21
490.1704(4)).
22
DIVISION
III
——
TERMINOLOGY
CHANGES.
Prior
to
the
enactment
23
of
the
revised
MBCA,
the
IBCA,
like
other
model
business
24
organization
statutes
(e.g.,
limited
liability
companies
25
under
Code
chapter
489
or
nonprofit
corporations
under
Code
26
chapter
504),
provided
that
a
foreign
business
was
“authorized
27
to
transact
business
in
this
state”
or
the
equivalent
phrase
28
“authorized
to
do
business
in
this
state”
by
obtaining
a
29
certificate
of
authorization
(e.g.,
Code
section
489.208
or
30
504.112).
By
comparison,
a
domestic
corporation
(incorporated
31
with
the
secretary
of
state)
may
obtain
a
certificate
of
32
existence
(Code
section
490.128)
which
is
also
the
phrase
used
33
by
other
business
organizations,
including
limited
liability
34
companies
(Code
section
489.208).
A
domestic
or
foreign
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nonprofit
corporation
may
obtain
a
certificate
of
existence
1
or
certificate
of
authority
(Code
section
504.112).
The
2
MBCA
provides
that
in
order
“to
do
business
in
this
state”
a
3
foreign
corporation
must
be
registered
with
the
secretary
of
4
state
and
obtain
a
certificate
of
registration
(Code
section
5
490.128).
Such
a
corporation
is
defined
as
a
“registered
6
foreign
corporation”
(Code
section
490.140(47)).
7
The
bill
makes
changes
to
this
terminology
when
referring
8
to
foreign
corporations
to
conform
with
the
MBCA’s
use
of
9
terms
and
to
enhance
readability.
The
phrase
“certificate
of
10
existence”
is
changed
to
“certificate
of
registration”
(amended
11
Code
section
490.120(5)).
The
phrase
“authorized
to
transact
12
business
in
this
state”
is
changed
to
“registered
to
do
13
business
in
this
state”
(amended
Code
sections
490.401(4)
and
14
490.1621(4)).
The
phrase
“foreign
corporation
registered
to
15
do
business
in
this
state”
is
shortened
to
“registered
foreign
16
corporation”
(amended
Code
sections
490.401(2),
490.748(3),
17
490.922(5),
and
490.1511(4)).
When
referring
to
a
foreign
18
nonprofit
corporation,
the
phrase
“registered
to
do
business
in
19
this
state”
is
changed
to
“authorized
to
do
business
in
this
20
state
(amended
Code
section
490.401(2)).
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