Iowa Legislature: SF2339

Affected Code

Sec. 70 - Strike and Replace 490.724 (2020)
Sec. 71 - Strike and Replace 490.725 (2020)
Sec. 72 - Strike and Replace 490.726 (2020)
Sec. 73 - Strike and Replace 490.727 (2020)
Sec. 74 - Strike and Replace 490.728 (2020)
Sec. 75 - Strike and Replace 490.729 (2020)
Sec. 76 - Strike and Replace 490.730 (2020)
Sec. 77 - Strike and Replace 490.731 (2020)
Sec. 78 - Strike and Replace 490.732 (2020)
Sec. 79 - Strike and Replace 490.740 (2020)
Sec. 80 - Strike and Replace 490.743 (2020)
Sec. 81 - Strike and Replace 490.744 (2020)
Sec. 82 - Strike and Replace 490.745 (2020)
Sec. 83 - Strike and Replace 490.746 (2020)
Sec. 84 - Strike and Replace 490.748 (2020)
Sec. 85 - New 490.749 (2020)
Sec. 86 - New 490.800 (2020)
Sec. 87 - Strike and Replace 490.801 (2020)
Sec. 88 - Strike and Replace 490.802 (2020)
Sec. 89 - Strike and Replace 490.803 (2020)
Sec. 90 - Strike and Replace 490.804 (2020)
Sec. 91 - Strike and Replace 490.805 (2020)
Sec. 92 - Strike and Replace 490.806 (2020)
Sec. 93 - Strike and Replace 490.807 (2020)
Sec. 94 - Strike and Replace 490.808 (2020)
Sec. 95 - Strike and Replace 490.809 (2020)
Sec. 96 - Strike and Replace 490.810 (2020)
Sec. 1 - Strike and Replace 490.101 (2020)
Sec. 2 - Strike and Replace 490.120 (2020)
Sec. 3 - Strike and Replace 490.121 (2020)
Sec. 4 - Strike and Replace 490.122 (2020)
Sec. 5 - Strike and Replace 490.123 (2020)
Sec. 6 - Strike and Replace 490.124 (2020)
Sec. 7 - Strike and Replace 490.125 (2020)
Sec. 8 - Strike and Replace 490.126 (2020)
Sec. 9 - Strike and Replace 490.127 (2020)
Sec. 10 - Strike and Replace 490.128 (2020)
Sec. 11 - Strike and Replace 490.129 (2020)
Sec. 12 - Strike and Replace 490.135 (2020)
Sec. 13 - Strike and Replace 490.140 (2020)
Sec. 14 - Strike and Replace 490.141 (2020)
Sec. 15 - Strike and Replace 490.142 (2020)
Sec. 16 - Strike and Replace 490.143 (2020)
Sec. 17 - Strike and Replace 490.144 (2020)
Sec. 18 - New 490.145 (2020)
Sec. 19 - New 490.146 (2020)
Sec. 20 - New 490.147 (2020)
Sec. 21 - New 490.148 (2020)
Sec. 22 - New 490.149 (2020)
Sec. 23 - New 490.150 (2020)
Sec. 24 - New 490.151 (2020)
Sec. 25 - New 490.152 (2020)
Sec. 26 - Strike and Replace 490.201 (2020)
Sec. 27 - Strike and Replace 490.202 (2020)
Sec. 28 - Strike and Replace 490.203 (2020)
Sec. 29 - Strike and Replace 490.205 (2020)
Sec. 30 - Strike and Replace 490.206 (2020)
Sec. 31 - Strike and Replace 490.207 (2020)
Sec. 32 - New 490.208 (2020)
Sec. 33 - New 490.209 (2020)
Sec. 34 - Strike and Replace 490.302 (2020)
Sec. 35 - Strike and Replace 490.303 (2020)
Sec. 36 - Strike and Replace 490.401 (2020)
Sec. 37 - Strike and Replace 490.402 (2020)
Sec. 38 - Strike and Replace 490.403 (2020)
Sec. 39 - Strike and Replace 490.501 (2020)
Sec. 40 - Strike and Replace 490.502 (2020)
Sec. 41 - Strike and Replace 490.503 (2020)
Sec. 42 - Strike and Replace 490.504 (2020)
Sec. 43 - Strike and Replace 490.601 (2020)
Sec. 44 - Strike and Replace 490.602 (2020)
Sec. 45 - Strike and Replace 490.603 (2020)
Sec. 46 - Strike and Replace 490.604 (2020)
Sec. 47 - Strike and Replace 490.620 (2020)
Sec. 48 - Strike and Replace 490.621 (2020)
Sec. 49 - Strike and Replace 490.622 (2020)
Sec. 50 - Strike and Replace 490.623 (2020)
Sec. 51 - Strike and Replace 490.624 (2020)
Sec. 52 - Strike and Replace 490.625 (2020)
Sec. 53 - Strike and Replace 490.626 (2020)
Sec. 54 - Strike and Replace 490.627 (2020)
Sec. 55 - Strike and Replace 490.630 (2020)
Sec. 56 - Strike and Replace 490.640 (2020)
Sec. 57 - Strike and Replace 490.701 (2020)
Sec. 58 - Strike and Replace 490.702 (2020)
Sec. 59 - Strike and Replace 490.703 (2020)
Sec. 60 - Strike and Replace 490.704 (2020)
Sec. 61 - Strike and Replace 490.705 (2020)
Sec. 62 - Strike and Replace 490.706 (2020)
Sec. 63 - Strike and Replace 490.707 (2020)
Sec. 64 - Strike and Replace 490.708 (2020)
Sec. 65 - Strike and Replace 490.709 (2020)
Sec. 66 - Strike and Replace 490.720 (2020)
Sec. 67 - Strike and Replace 490.721 (2020)
Sec. 68 - Strike and Replace 490.722 (2020)
Sec. 69 - Strike and Replace 490.723 (2020)
Sec. 97 - Strike and Replace 490.820 (2020)
Sec. 98 - Strike and Replace 490.821 (2020)
Sec. 99 - Strike and Replace 490.822 (2020)
Sec. 100 - Strike and Replace 490.823 (2020)
Sec. 101 - Strike and Replace 490.824 (2020)
Sec. 102 - Strike and Replace 490.825 (2020)
Sec. 103 - Strike and Replace 490.830 (2020)
Sec. 104 - Strike and Replace 490.831 (2020)
Sec. 105 - Strike and Replace 490.833 (2020)
Sec. 106 - Strike and Replace 490.840 (2020)
Sec. 107 - Strike and Replace 490.842 (2020)
Sec. 108 - Strike and Replace 490.843 (2020)
Sec. 109 - Strike and Replace 490.844 (2020)
Sec. 110 - Strike and Replace 490.850 (2020)
Sec. 111 - Strike and Replace 490.851 (2020)
Sec. 112 - Strike and Replace 490.852 (2020)
Sec. 113 - Strike and Replace 490.853 (2020)
Sec. 114 - Strike and Replace 490.854 (2020)
Sec. 115 - Strike and Replace 490.855 (2020)
Sec. 116 - Strike and Replace 490.856 (2020)
Sec. 117 - Strike and Replace 490.857 (2020)
Sec. 118 - Strike and Replace 490.858 (2020)
Sec. 119 - Strike and Replace 490.860 (2020)
Sec. 120 - Strike and Replace 490.861 (2020)
Sec. 121 - Strike and Replace 490.862 (2020)
Sec. 122 - Strike and Replace 490.863 (2020)
Sec. 123 - Strike and Replace 490.870 (2020)
Sec. 124 - Strike and Replace 490.901 (2020)
Sec. 125 - Strike and Replace 490.902 (2020)
Sec. 126 - New 490.903 (2020)
Sec. 127 - New 490.904 (2020)
Sec. 128 - New 490.905 (2020)
Sec. 129 - New 490.920 (2020)
Sec. 130 - New 490.921 (2020)
Sec. 131 - New 490.922 (2020)
Sec. 132 - New 490.923 (2020)
Sec. 133 - New 490.924 (2020)
Sec. 134 - New 490.930 (2020)
Sec. 135 - New 490.931 (2020)
Sec. 136 - New 490.932 (2020)
Sec. 137 - New 490.933 (2020)
Sec. 138 - New 490.934 (2020)
Sec. 139 - New 490.935 (2020)
Sec. 140 - Strike and Replace 490.1003 (2020)
Sec. 141 - Strike and Replace 490.1004 (2020)
Sec. 142 - Strike and Replace 490.1006 (2020)
Sec. 143 - Strike and Replace 490.1007 (2020)
Sec. 144 - Strike and Replace 490.1009 (2020)
Sec. 145 - Strike and Replace 490.1020 (2020)
Sec. 146 - Strike and Replace 490.1021 (2020)
Sec. 147 - New 490.1022 (2020)
Sec. 148 - Strike and Replace 490.1101 (2020)
Sec. 149 - Strike and Replace 490.1102 (2020)
Sec. 150 - Strike and Replace 490.1103 (2020)
Sec. 151 - Strike and Replace 490.1104 (2020)
Sec. 152 - Strike and Replace 490.1105 (2020)
Sec. 153 - Strike and Replace 490.1106 (2020)
Sec. 154 - Strike and Replace 490.1107 (2020)
Sec. 155 - Strike and Replace 490.1108 (2020)
Sec. 156 - Strike and Replace 490.1201 (2020)
Sec. 157 - Strike and Replace 490.1202 (2020)
Sec. 158 - Strike and Replace 490.1301 (2020)
Sec. 159 - Strike and Replace 490.1302 (2020)
Sec. 160 - Strike and Replace 490.1303 (2020)
Sec. 161 - Strike and Replace 490.1320 (2020)
Sec. 162 - Strike and Replace 490.1321 (2020)
Sec. 163 - Strike and Replace 490.1322 (2020)
Sec. 164 - Strike and Replace 490.1323 (2020)
Sec. 165 - Strike and Replace 490.1324 (2020)
Sec. 166 - Strike and Replace 490.1325 (2020)
Sec. 167 - Strike and Replace 490.1326 (2020)
Sec. 168 - Strike and Replace 490.1330 (2020)
Sec. 169 - Strike and Replace 490.1331 (2020)
Sec. 170 - Strike and Replace 490.1340 (2020)
Sec. 171 - Strike and Replace 490.1402 (2020)
Sec. 172 - Strike and Replace 490.1403 (2020)
Sec. 173 - Strike and Replace 490.1404 (2020)
Sec. 174 - Strike and Replace 490.1405 (2020)
Sec. 175 - Strike and Replace 490.1406 (2020)
Sec. 176 - Strike and Replace 490.1407 (2020)
Sec. 177 - Strike and Replace 490.1409 (2020)
Sec. 178 - Strike and Replace 490.1420 (2020)
Sec. 179 - Strike and Replace 490.1421 (2020)
Sec. 180 - Strike and Replace 490.1422 (2020)
Sec. 181 - Strike and Replace 490.1423 (2020)
Sec. 182 - Strike and Replace 490.1430 (2020)
Sec. 183 - Strike and Replace 490.1431 (2020)
Sec. 184 - Strike and Replace 490.1432 (2020)
Sec. 185 - Strike and Replace 490.1434 (2020)
Sec. 186 - Strike and Replace 490.1440 (2020)
Sec. 187 - Strike and Replace 490.1501 (2020)
Sec. 188 - Strike and Replace 490.1502 (2020)
Sec. 189 - Strike and Replace 490.1503 (2020)
Sec. 190 - Strike and Replace 490.1504 (2020)
Sec. 191 - Strike and Replace 490.1505 (2020)
Sec. 192 - Strike and Replace 490.1506 (2020)
Sec. 193 - Strike and Replace 490.1507 (2020)
Sec. 194 - Strike and Replace 490.1508 (2020)
Sec. 195 - Strike and Replace 490.1509 (2020)
Sec. 196 - Strike and Replace 490.1510 (2020)
Sec. 197 - New 490.1511 (2020)
Sec. 198 - New 490.1512 (2020)
Sec. 199 - Strike and Replace 490.1601 (2020)
Sec. 200 - Strike and Replace 490.1602 (2020)
Sec. 201 - Strike and Replace 490.1603 (2020)
Sec. 202 - Strike and Replace 490.1604 (2020)
Sec. 203 - Strike and Replace 490.1605 (2020)
Sec. 204 - Strike and Replace 490.1620 (2020)
Sec. 205 - Strike and Replace 490.1622 (2020)
Sec. 206 - Strike and Replace 490.1701 (2020)
Sec. 207 - Strike and Replace 490.1702 (2020)
Sec. 208 - Strike and Replace 490.1703 (2020)
Sec. 209 - New 490.1704 (2020)
Sec. 210 - New 490.1705 (2020)
Sec. 211 - New 490.1706 (2020)
Sec. 212 - New 490.1801 (2020)
Sec. 213 - New 490.1802 (2020)
Sec. 214 - New 490.1803 (2020)
Sec. 215 - New 490.1804 (2020)
Sec. 218 - Session Law 490.130 (2020)
Sec. 218 - Session Law 490.832 (2020)
Sec. 218 - Session Law 490 (2020)
Sec. 218 - Session Law 1622 (2020)
Sec. 218 - Session Law 490.1621 (2020)
Sec. 219 - Repeal 490.624A (2020)
Sec. 219 - Repeal 490.628 (2020)
Sec. 219 - Repeal 490.1111 (2020)
Sec. 219 - Repeal 490.1112 (2020)
Sec. 219 - Repeal 490.1113 (2020)
Sec. 219 - Repeal 490.1114 (2020)
Sec. 219 - Repeal 490.1520 (2020)
Sec. 219 - Repeal 490.1523 (2020)
Sec. 219 - Repeal 490.1530 (2020)
Sec. 219 - Repeal 490.1531 (2020)
Sec. 219 - Repeal 490.1532 (2020)
Sec. 219 - Repeal 490.1606 (2020)
Sec. 222 - Amend 249A.40 (2020)
Sec. 223 - Amend 455B.397 (2020)
Sec. 224 - Amend 455B.430.5 (2020)
Sec. 225 - Amend 496C.14.5 (2020)
Sec. 226 - Amend 496C.19 (2020)
Sec. 227 - Amend 499.69A.2.b (2020)
Sec. 228 - Amend 499.69A.5 (2020)
Sec. 228 - Amend 499.69A.6 (2020)
Sec. 229 - Amend Free-form 508.12.1 (2020)
Sec. 230 - Amend Free-form 515.78.1 (2020)
Sec. 231 - Amend 515E.3A.1.a (2020)
Sec. 232 - Amend 515G.3.2 (2020)
Sec. 234 - Add 504.205.4 (2020)

Senate File 2339 - ReprintedA Bill ForAn Act 1providing for corporations, providing for certain fees,
2and including effective date provisions.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1DIVISION I
2GENERAL PROVISIONS
3   Section 1.  Section 490.101, Code 2020, is amended by
4striking the section and inserting in lieu thereof the
5following:
   6490.101  Short title.
   7This chapter shall be known and may be cited as the “Iowa
8Business Corporation Act”.
9   Sec. 2.  Section 490.120, Code 2020, is amended by striking
10the section and inserting in lieu thereof the following:
   11490.120  Requirements for documents — extrinsic facts.
   121.  A document must satisfy the requirements of this
13section, and of any other section that adds to or varies these
14requirements, to be entitled to filing by the secretary of
15state.
   162.  This chapter must require or permit filing the document
17in the office of the secretary of state.
   183.  The document must contain the information required by
19this chapter and may contain other information.
   204.  The document must be typewritten or printed or, if
21electronically transmitted, it must be in a format that can be
22retrieved or reproduced in typewritten or printed form.
   235.  The document must be in the English language. A
24corporate name need not be in English if written in English
25letters or Arabic or Roman numerals, and the certificate of
26existence required of foreign corporations need not be in
27English if accompanied by a reasonably authenticated English
28translation.
   296.  Except as provided in section 490.1622, subsection 3, the
30document must be signed by any of the following:
   31a.  The chair of the board of directors of a domestic or
32foreign corporation, its president, or another of its officers.
   33b.  If directors have not been selected or the corporation
34has not been formed, by an incorporator.
   35c.  If the corporation is in the hands of a receiver,
-1-1trustee, or other court-appointed fiduciary, by that fiduciary.
   27.  a.  The person executing the document shall sign it
3and state beneath or opposite the person’s signature the
4person’s name and the capacity in which the document is signed.
5The document may but need not contain a corporate seal,
6attestation, acknowledgment, or verification.
   7b.  The secretary of state may accept for filing a document
8containing a copy of a signature, however made.
   98.  If the secretary of state has prescribed a mandatory
10form for the document under section 490.121, subsection 1, the
11document must be in or on the prescribed form.
   129.  The document must be delivered to the office of the
13secretary of state for filing. Delivery may be made by
14electronic transmission if and to the extent permitted by the
15secretary of state. If it is filed in typewritten or printed
16form and not transmitted electronically, the secretary of state
17may require one exact or conformed copy to be delivered with
18the document.
   1910.  When the document is delivered to the office of the
20secretary of state for filing, the correct filing fee, and any
21franchise tax, license fee, or penalty required by this chapter
22or other law to be paid at the time of delivery for filing must
23be paid or provision for payment made in a manner permitted by
24the secretary of state.
   2511.  Whenever a provision of this chapter permits any of the
26terms of a plan or a filed document to be dependent on facts
27objectively ascertainable outside the plan or filed document,
28all of the following provisions apply:
   29a.  The manner in which the facts will operate upon the terms
30of the plan or filed document must be set forth in the plan or
31filed document.
   32b.  The facts may include any of the following:
   33(1)  Any of the following that is available in a nationally
34recognized news or information medium either in print or
35electronically: statistical or market indices, market prices
-2-1of any security or group of securities, interest rates,
2currency exchange rates, or similar economic or financial data.
   3(2)  A determination or action by any person or body,
4including the corporation or any other party to a plan or filed
5document.
   6(3)  The terms of, or actions taken under, an agreement to
7which the corporation is a party, or any other agreement or
8document.
   9c.  As used in this subsection:
   10(1)  “Filed document” means a document filed by the secretary
11of state under any provision of this chapter except subchapter
12XV or section 490.1622.
   13(2)  “Plan” means a plan of domestication, conversion,
14merger, or share exchange.
   15d.  The following provisions of a plan or filed document
16shall not be made dependent on facts outside the plan or filed
17document:
   18(1)  The name and address of any person required in a filed
19document.
   20(2)  The registered office of any entity required in a filed
21document.
   22(3)  The registered agent of any entity required in a filed
23document.
   24(4)  The number of authorized shares and designation of each
25class or series of shares.
   26(5)  The effective date of a filed document.
   27(6)  Any required statement in a filed document of the date
28on which the underlying transaction was approved or the manner
29in which that approval was given.
   30e.  If a provision of a filed document is made dependent on a
31fact ascertainable outside of the filed document, and that fact
32is neither ascertainable by reference to a source described
33in paragraph “b”, subparagraph (1), nor a document that is a
34matter of public record, and the affected shareholders have
35not received notice of the fact from the corporation, then the
-3-1corporation shall file with the secretary of state articles of
2amendment to the filed document setting forth the fact promptly
3after the time when the fact referred to is first ascertainable
4or thereafter changes. Articles of amendment under this
5paragraph “e” are deemed to be authorized by the authorization
6of the original filed document to which they relate and may be
7filed by the corporation without further action by the board of
8directors or the shareholders.
9   Sec. 3.  Section 490.121, Code 2020, is amended by striking
10the section and inserting in lieu thereof the following:
   11490.121  Forms.
   121.  a.  The secretary of state may prescribe and furnish on
13request any of the following forms:
   14(1)  An application for a certificate of existence or
15certificate of registration.
   16(2)  A foreign corporation’s registration statement.
   17(3)  A foreign corporation’s statement of withdrawal.
   18(4)  A foreign corporation’s transfer of registration
19statement.
   20(5)  The biennial report required by section 490.1622.
   21b.  If the secretary of state so requires, use of the forms
22provided in paragraph “a” is mandatory.
   232.  The secretary of state may prescribe and furnish on
24request forms for other documents required or permitted to be
25filed pursuant to this chapter but their use is not mandatory.
26   Sec. 4.  Section 490.122, Code 2020, is amended by striking
27the section and inserting in lieu thereof the following:
   28490.122  Filing, service, and copying fees.
   291.  The secretary of state shall collect the following fees
30when the documents described in this subsection are delivered
31to the secretary of state for filing:
    32DOCUMENT FEE
   33a. Articles of incorporation $ 50
34b. Application for use of indistinguishable
35 name $ 10
-4- 1c. Application for reserved name $ 10
2d. Notice of transfer of reserved name $ 10
3e. Application for registered name $ 20
4f. Application for renewal of registered
5 name $ 20
6g. Corporation’s statement of change of
7 registered agent or registered office or both No fee
8h. Agent’s statement of change of registered office
9 for each affected corporation not to exceed
10a total of No fee
11i. Agent’s statement of resignation No fee
12j. Articles of domestication $ 50
13k. Articles of conversion $ 50
14l. Amendment of articles of incorporation $ 50
15m. Restatement of articles of incorporation
16 with amendment of articles $ 50
17n. Restatement of articles of incorporation
18 without amendment of articles $ 50
19o. Articles of merger or share exchange $ 50
20p. Articles of dissolution $ 5
21q. Articles of revocation of dissolution $ 5
22r. Certificate of administrative dissolution No fee
23s. Application for reinstatement following
24 administrative dissolution $ 5
25t. Certificate of reinstatement No fee
26u. Certificate of judicial dissolution No fee
27v. Foreign registration statement $ 100
28w. Amendment of foreign registration
29 statement $ 100
30x. Statement of withdrawal $ 10
31y. Transfer of foreign registration statement $ 100
32z. Notice of termination of registration No fee
33aa. Articles of correction $ 5
34ab. Articles of validation $ 5
35ac. Application for certificate of existence or
-5-1registration $ 5
2ad. Biennial report $ 60
3ae. Any other document required or permitted to
4be filed by this chapter $5
   52.  The secretary of state shall collect a fee of five
6dollars each time process is served on the secretary of state
7under this chapter. The party to a proceeding causing service
8of process is entitled to recover this fee as costs if such
9party prevails in the proceeding.
   103.  The secretary of state shall collect the following fees
11for copying and certifying the copy of any filed document
12relating to a domestic or foreign corporation:
   13a.  One dollar a page for copying.
   14b.  Five dollars for the certificate.
15   Sec. 5.  Section 490.123, Code 2020, is amended by striking
16the section and inserting in lieu thereof the following:
   17490.123  Effective date of filed document.
   181.  Except to the extent otherwise provided in section
19490.124, subsection 3, and part E, a document accepted for
20filing is effective as follows:
   21a.  On the date and at the time of filing, as provided in
22section 490.125, subsection 2.
   23b.  On the date of filing and at the time specified in the
24document as its effective time, if later than the time under
25paragraph “a”.
   26c.  At a specified delayed effective date and time which
27shall not be more than ninety days after filing.
   28d.  If a delayed effective date is specified, but no time is
29specified, at 12:01 a.m.on the date specified, which shall not
30be more than ninety days after the date of filing.
   312.  If a filed document does not specify the time zone or
32place at which a date or time or both is to be determined, the
33date or time or both at which it becomes effective shall be
34those prevailing at the place of filing in this state.
35   Sec. 6.  Section 490.124, Code 2020, is amended by striking
-6-1the section and inserting in lieu thereof the following:
   2490.124  Correcting filed document.
   31.  A document filed by the secretary of state pursuant to
4this chapter may be corrected if any of the following applies:
   5a.  The document contains an inaccuracy.
   6b.  The document was defectively signed, attested, sealed,
7verified, or acknowledged.
   8c.  The electronic transmission was defective.
   92.  A document is corrected by complying with all of the
10following:
   11a.  By preparing articles of correction that do all of the
12following:
   13(1)  Describe the document, including its filing date, or a
14copy of the document is attached to the articles of correction.
   15(2)  Specify the inaccuracy or defect to be corrected.
   16(3)  Correct the inaccuracy or defect.
   17b.  By delivering the articles of correction to the secretary
18of state for filing.
   193.  Articles of correction are effective on the effective
20date of the document they correct except as to persons relying
21on the uncorrected document and adversely affected by the
22correction. As to those persons, articles of correction are
23effective when filed.
24   Sec. 7.  Section 490.125, Code 2020, is amended by striking
25the section and inserting in lieu thereof the following:
   26490.125  Filing duty of secretary of state.
   271.  If a document delivered to the office of the secretary of
28state for filing satisfies the requirements of section 490.120,
29the secretary of state shall file it.
   302.  The secretary of state files a document by recording
31it as filed on the date and time of receipt. After filing
32a document, except the biennial report required by section
33490.1622, and except as provided in section 490.503, the
34secretary of state shall return to the person who delivered
35the document for filing a copy of the document with an
-7-1acknowledgment of the date and time of filing.
   23.  If the secretary of state refuses to file a document,
3it shall be returned to the person who delivered the document
4for filing within five days after the document was delivered,
5together with a brief, written explanation of the reason for
6the refusal.
   74.  The secretary of state’s duty to file documents under
8this section is ministerial. The secretary of state’s filing
9or refusing to file a document does not create a presumption
10of any of the following:
   11a.  The document does or does not conform to the requirements
12of this chapter.
   13b.  The information contained in the document is correct or
14incorrect.
15   Sec. 8.  Section 490.126, Code 2020, is amended by striking
16the section and inserting in lieu thereof the following:
   17490.126  Appeal from secretary of state’s refusal to file
18document.
   191.  If the secretary of state refuses to file a document
20delivered for filing, the person that delivered the document
21for filing may petition the district court of the county where
22the corporation’s principal office or, if none in this state,
23its registered office, is located to compel its filing. The
24document and the explanation of the secretary of state’s
25refusal to file must be attached to the petition. The court
26may decide the matter in a summary proceeding.
   272.  The court may order the secretary of state to file the
28document or take other action the court considers appropriate.
   293.  The court’s final decision may be appealed as in other
30civil proceedings.
31   Sec. 9.  Section 490.127, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.127  Evidentiary effect of certified copy of filed
34document.
   35A certificate from the secretary of state delivered with
-8-1a copy of a document filed by the secretary of state is
2conclusive evidence that the original document is on file with
3the secretary of state.
4   Sec. 10.  Section 490.128, Code 2020, is amended by striking
5the section and inserting in lieu thereof the following:
   6490.128  Certificate of existence or registration.
   71.  Any person may apply to the secretary of state to furnish
8a certificate of existence for a domestic corporation or a
9certificate of registration for a foreign corporation.
   102.  A certificate of existence must set forth all of the
11following:
   12a.  The domestic corporation’s corporate name.
   13b.  That the domestic corporation is duly incorporated under
14the law of this state, the date of its incorporation, and the
15period of its duration if less than perpetual.
   16c.  That all fees, taxes, and penalties owed to this state
17have been paid, subject to all of the following:
   18(1)  Payment is reflected in the records of the secretary of
19state.
   20(2)  Nonpayment affects the existence of the domestic
21corporation.
   22d.  That its most recent biennial report required by section
23490.1622 has been filed by the secretary of state.
   24e.  That articles of dissolution have not been filed.
   25f.  That the corporation is not administratively dissolved
26and a proceeding is not pending under section 490.1421.
   27g.  Other facts of record in the office of the secretary of
28state that may be requested by the applicant.
   293.  A certificate of registration must set forth all of the
30following:
   31a.  The foreign corporation’s name used in this state.
   32b.  That the foreign corporation is registered to do business
33in this state.
   34c.  That all fees, taxes, and penalties owed to this state
35have been paid, subject to all of the following:
-9-   1(1)  Payment is reflected in the records of the secretary of
2state.
   3(2)  Nonpayment affects the registration of the foreign
4corporation.
   5d.  That its most recent biennial report required by section
6490.1622 has been filed by the secretary of state.
   7e.  Other facts of record in the office of the secretary of
8state that may be requested by the applicant.
   94.  Subject to any qualification stated in the certificate,
10a certificate of existence or registration issued by the
11secretary of state may be relied upon as conclusive evidence of
12the facts stated in the certificate.
13   Sec. 11.  Section 490.129, Code 2020, is amended by striking
14the section and inserting in lieu thereof the following:
   15490.129  Penalty for signing false document.
   161.  A person commits an offense by signing a document that
17the person knows is false in any material respect with intent
18that the document be delivered to the secretary of state for
19filing.
   202.  An offense under this section is a serious misdemeanor
21punishable by a fine of not to exceed one thousand dollars.
22   Sec. 12.  Section 490.135, Code 2020, is amended by striking
23the section and inserting in lieu thereof the following:
   24490.135  Powers.
   25The secretary of state has the power reasonably necessary to
26perform the duties required of the secretary of state by this
27chapter.
28   Sec. 13.  Section 490.140, Code 2020, is amended by striking
29the section and inserting in lieu thereof the following:
   30490.140  Chapter definitions.
   31As used in this chapter, unless otherwise specified:
   321.  “Articles of incorporation” means the articles of
33incorporation described in section 490.202, all amendments
34to the articles of incorporation, and any other documents
35permitted or required to be delivered for filing by a domestic
-10-1business corporation with the secretary of state under any
2provision of this chapter that modify, amend, supplement,
3restate, or replace the articles of incorporation. After
4an amendment of the articles of incorporation or any other
5document filed under this chapter that restates the articles of
6incorporation in their entirety, the articles of incorporation
7shall not include any prior documents. When used with respect
8to a foreign corporation or a domestic or foreign nonprofit
9corporation, the “articles of incorporation” of such an entity
10means the document of such entity that is equivalent to the
11articles of incorporation of a domestic business corporation.
   122.  “Authorized shares” means the shares of all classes a
13domestic or foreign corporation is authorized to issue.
   143.  “Beneficial shareholder” means a person who owns
15the beneficial interest in shares, which may be a record
16shareholder or a person on whose behalf shares are registered
17in the name of an intermediary or nominee.
   184.  “Conspicuous” means so written, displayed, or presented
19that a reasonable person against whom the writing is to operate
20should have noticed it.
   215.  “Cooperative association” means an entity that is
22structured and operated on a cooperative basis pursuant to 26
23U.S.C. §1381(a) and that meets the definitional requirements of
24an association as provided in 12 U.S.C. §1141j(a) or 7 U.S.C.
25§291.
   266.  “Corporation”, “domestic corporation”, “business
27corporation”, or “domestic business corporation” means a
28corporation for profit, which is not a foreign corporation,
29incorporated under this chapter.
   307.  “Deliver” or “delivery” means any method of delivery
31used in conventional commercial practice, including delivery
32by hand, mail, commercial delivery, and, if authorized in
33accordance with section 490.141, by electronic transmission.
   348.  “Distribution” means a direct or indirect transfer of
35cash or other property, except a corporation’s own shares,
-11-1or incurrence of indebtedness by a corporation to or for the
2benefit of its shareholders in respect of any of its shares.
3A distribution may be in the form of a payment of a dividend;
4a purchase, redemption, or other acquisition of shares; a
5distribution of indebtedness; a distribution in liquidation;
6or otherwise.
   79.  “Document” means any of the following:
   8a.  A tangible medium on which information is inscribed, and
9includes handwritten, typed, printed or similar instruments,
10and copies of such instruments.
   11b.  An electronic record.
   1210.  “Domestic”, with respect to an entity, means an entity
13governed as to its internal affairs by the law of this state.
   1411.  “Effective date”, when referring to a document accepted
15for filing by the secretary of state, means the time and date
16determined in accordance with section 490.123.
   1712.  “Electronic” means relating to technology having
18electrical, digital, magnetic, wireless, optical,
19electromagnetic, or similar capabilities.
   2013.  “Electronic record” means information that is stored in
21an electronic or other nontangible medium and is retrievable in
22paper form through an automated process used in conventional
23commercial practice, unless otherwise authorized in accordance
24with section 490.141, subsection 10.
   2514.  “Electronic transmission” or “electronically transmitted”
26means any form or process of communication not directly
27involving the physical transfer of paper or another tangible
28medium, which is all of the following:
   29a.  Suitable for the retention, retrieval, and reproduction
30of information by the recipient.
   31b.  Retrievable in paper form by the recipient through an
32automated process used in conventional commercial practice,
33unless otherwise authorized in accordance with section 490.141,
34subsection 10.
   3515.  “Eligible entity” means a domestic or foreign
-12-1unincorporated entity or a domestic or foreign nonprofit
2corporation.
   316.  “Eligible interests” means interests or memberships.
   417.  “Employee” includes an officer but not a director.
5A director may accept duties that make the director also an
6employee.
   718.  “Entity” includes a domestic and foreign business
8corporation; domestic and foreign nonprofit corporation;
9estate; trust; domestic and foreign unincorporated entity; and
10a state, the United States, and a foreign government.
   1119.  “Expenses” means reasonable expenses of any kind,
12including reasonable fees and expenses of counsel and experts
13employed by the shareholder, that are incurred in connection
14with a matter.
   1520.  “Filing entity” means an unincorporated entity, other
16than a limited liability partnership, that is of a type that
17is created by filing a public organic record or is required to
18file a public organic record that evidences its creation.
   1921.  “Foreign”, with respect to an entity, means an entity
20governed as to its internal affairs by the organic law of a
21jurisdiction other than this state.
   2222.  “Foreign corporation” or “foreign business corporation”
23means a corporation incorporated under a law other than the
24law of this state which would be a business corporation if
25incorporated under the law of this state.
   2623.  “Foreign nonprofit corporation” means a corporation
27incorporated under a law other than the law of this state which
28would be a nonprofit corporation if incorporated under the law
29of this state.
   3024.  “Foreign registration statement” means the foreign
31registration statement described in section 490.1503.
   3225.  “Governmental subdivision” includes an authority, city,
33county, district, and municipality.
   3426.  “Governor” means any person under whose authority the
35powers of an entity are exercised and under whose direction the
-13-1activities and affairs of the entity are managed pursuant to
2the organic law governing the entity and its organic rules.
   327.  “Includes” and “including” denote a partial definition
4or a nonexclusive list.
   528.  “Individual” means a natural person.
   629.  “Interest” means either or both of the following rights
7under the organic law governing an unincorporated entity:
   8a.  The right to receive distributions from the entity either
9in the ordinary course or upon liquidation.
   10b.  The right to receive notice or vote on issues involving
11its internal affairs, other than as an agent, assignee, proxy,
12or person responsible for managing its business and affairs.
   1330.  “Interest holder” means a person who holds of record an
14interest.
   1531.  a.  “Interest holder liability” means any of the
16following:
   17(1)  Personal liability for a debt, obligation, or other
18liability of a domestic or foreign corporation or eligible
19entity that is imposed on a person by any of the following:
   20(a)  Solely by reason of the person’s status as a
21shareholder, member, or interest holder.
   22(b)  By the articles of incorporation of the domestic
23corporation or the organic rules of the eligible entity
24or foreign corporation that make one or more specified
25shareholders, members, or interest holders, or categories of
26shareholders, members, or interest holders, liable in their
27capacity as shareholders, members, or interest holders for all
28or specified liabilities of the corporation or eligible entity.
   29(2)  An obligation of a shareholder, member, or interest
30holder under the articles of incorporation of a domestic
31corporation or the organic rules of an eligible entity or
32foreign corporation to contribute to the entity.
   33b.  For purposes of paragraph “a”, except as otherwise
34provided in the articles of incorporation of a domestic
35corporation or the organic law or organic rules of an eligible
-14-1entity or a foreign corporation, interest holder liability
2arises under paragraph “a”, subparagraph (1), when the
3corporation or eligible entity incurs the liability.
   432.  “Jurisdiction of formation” means the state or country
5the law of which includes the organic law governing a domestic
6or foreign corporation or eligible entity.
   733.  “Means” denotes an exhaustive definition.
   834.  “Membership” means the rights of a member in a domestic
9or foreign nonprofit corporation.
   1035.  “Merger” means a transaction pursuant to section
11490.1102.
   1236.  “Nonfiling entity” means an unincorporated entity that
13is of a type that is not created by filing a public organic
14record.
   1537.  “Nonprofit corporation” or “domestic nonprofit
16corporation” means a corporation incorporated under the laws of
17this state and subject to the provisions of chapter 504.
   1838.  “Organic law” means the statute governing the internal
19affairs of a domestic or foreign business or nonprofit
20corporation or unincorporated entity.
   2139.  “Organic rules” means the public organic record and
22private organic rules of a domestic or foreign corporation or
23eligible entity.
   2440.  “Person” means a person as defined in section 4.1.
   2541.  “Principal office” means the office, in or out of this
26state, so designated in the biennial report required by section
27490.1622 or foreign registration statement where the principal
28executive offices of a domestic or foreign corporation are
29located.
   3042.  a.  “Private organic rules” means any of the following:
   31(1)  The bylaws of a domestic or foreign business or
32nonprofit corporation.
   33(2)  The rules, regardless of whether in writing, that govern
34the internal affairs of an unincorporated entity, are binding
35on all of its interest holders, and are not part of its public
-15-1organic record, if any.
   2b.  Where private organic rules have been amended or
3restated, the term means the private organic rules as last
4amended or restated.
   543.  “Proceeding” includes a civil suit and criminal,
6administrative, and investigatory action.
   744.  a.  “Public organic record” means any of the following:
   8(1)  The articles of incorporation of a domestic or foreign
9business or nonprofit corporation.
   10(2)  The document, if any, the filing of which is required
11to create an unincorporated entity, or which creates the
12unincorporated entity and is required to be filed.
   13b.  Where a public organic record has been amended or
14restated, the term means the public organic record as last
15amended or restated.
   1645.  “Record date” means the date fixed for determining
17the identity of the corporation’s shareholders and their
18shareholdings for purposes of this chapter. Unless another
19time is specified when the record date is fixed, the
20determination shall be made as of the close of business at the
21principal office of the corporation on the date so fixed.
   2246.  “Record shareholder” means any of the following:
   23a.  The person in whose name shares are registered in the
24records of the corporation.
   25b.  The person identified as the beneficial owner of shares
26in a beneficial ownership certificate pursuant to section
27490.723 on file with the corporation to the extent of the
28rights granted by such certificate.
   2947.  “Registered foreign corporation” means a foreign
30corporation registered to do business in the state pursuant to
31subchapter XV.
   3248.  “Secretary” means the corporate officer to whom the
33board of directors has delegated responsibility under section
34490.840, subsection 3, to maintain the minutes of the meetings
35of the board of directors and of the shareholders and for
-16-1authenticating records of the corporation.
   249.  “Share exchange” means a transaction pursuant to section
3490.1103.
   450.  “Shareholder” means a record shareholder.
   551.  “Shares” means the units into which the proprietary
6interests in a domestic or foreign corporation are divided.
   752.  “Sign” or “signature” means, with present intent to
8authenticate or adopt a document, doing any of the following:
   9a.  Executing or adopting a tangible symbol to a document,
10including any manual, facsimile, or conformed signature.
   11b.  Attaching to or logically associating with an electronic
12transmission an electronic sound, symbol, or process,
13and including an electronic signature in an electronic
14transmission.
   1553.  “State”, when referring to a part of the United
16States, includes a state and commonwealth, and their agencies
17and governmental subdivisions, and a territory and insular
18possession, and their agencies and governmental subdivisions,
19of the United States.
   2054.  “Subscriber” means a person who subscribes for shares in
21a corporation, whether before or after incorporation.
   2255.  “Type of entity” means a generic form of entity that is
23any of the following:
   24a.  Recognized at common law.
   25b.  Formed under an organic law, regardless of whether
26some entities formed under that law are subject to provisions
27of that law that create different categories of the form of
28entity.
   2956.  a.  “Unincorporated entity” means an organization
30or artificial legal person that either has a separate legal
31existence or has the power to acquire an estate in real
32property in its own name and that is not any of the following:
   33(1)  A domestic or foreign business or nonprofit
34corporation.
   35(2)  A series of a limited liability company or of another
-17-1type of entity.
   2(3)  An estate.
   3(4)  A trust.
   4(5)  A state, the United States, or foreign government.
   5b.  “Unincorporated entity” includes a general partnership,
6limited liability company, limited partnership, business
7trust, joint stock association, and unincorporated nonprofit
8association.
   957.  “United States” includes district, authority, bureau,
10commission, department, and any other agency of the United
11States.
   1258.  “Unrestricted voting trust beneficial owner” means, with
13respect to any shareholder rights, a voting trust beneficial
14owner whose entitlement to exercise the shareholder right in
15question is not inconsistent with the voting trust agreement.
   1659.  “Voting group” means all shares of one or more
17classes or series that under the articles of incorporation
18or this chapter are entitled to vote and be counted together
19collectively on a matter at a meeting of shareholders. All
20shares entitled by the articles of incorporation or this
21chapter to vote generally on the matter are for that purpose
22a single voting group.
   2360.  “Voting power” means the current power to vote in the
24election of directors.
   2561.  “Voting trust beneficial owner” means an owner of
26a beneficial interest in shares of the corporation held
27in a voting trust established pursuant to section 490.730,
28subsection 1.
   2962.  “Writing” or “written” means any information in the form
30of a document.
31   Sec. 14.  Section 490.141, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.141  Notices and other communications.
   341.  A notice under this chapter must be in writing unless
35oral notice is reasonable in the circumstances. Unless
-18-1otherwise agreed between the sender and the recipient, words
2in a notice or other communication under this chapter must be
3in English.
   42.  A notice or other communication may be given by any
5method of delivery, except that electronic transmissions must
6be in accordance with this section. If the methods of delivery
7are impracticable, a notice or other communication may be
8given by means of a broad nonexclusionary distribution to the
9public, which may include a newspaper of general circulation
10in the area where published; radio, television, or other
11form of public broadcast communication; or other methods of
12distribution that the corporation has previously identified to
13its shareholders.
   143.  A notice or other communication to a domestic corporation
15or to a foreign corporation registered to do business in this
16state may be delivered to the corporation’s registered agent at
17its registered office or to the secretary at the corporation’s
18principal office shown in its most recent biennial report
19required by section 490.1622 or, in the case of a foreign
20corporation that has not yet delivered a biennial report, in
21its foreign registration statement.
   224.  A notice or other communication may be delivered by
23electronic transmission if consented to by the recipient or if
24authorized by subsection 10.
   255.  Any consent under subsection 4 may be revoked by the
26person who consented by written or electronic notice to the
27person to whom the consent was delivered. Any such consent is
28deemed revoked if all of the following apply:
   29a.  The corporation is unable to deliver two consecutive
30electronic transmissions given by the corporation in accordance
31with such consent.
   32b.  Such inability becomes known to the secretary or an
33assistant secretary or to the transfer agent, or other person
34responsible for the giving of notice or other communications;
35provided, however, the inadvertent failure to treat such
-19-1inability as a revocation shall not invalidate any meeting or
2other action.
   36.  Unless otherwise agreed between the sender and the
4recipient, an electronic transmission is received when all of
5the following apply:
   6a.  The electronic transmission enters an information
7processing system that the recipient has designated or uses
8for the purposes of receiving electronic transmissions or
9information of the type sent, and from which the recipient is
10able to retrieve the electronic transmission.
   11b.  The electronic transmission is in a form capable of being
12processed by that system.
   137.  Receipt of an electronic acknowledgment from an
14information processing system described in subsection 6,
15paragraph “a”, establishes that an electronic transmission was
16received but, by itself, does not establish that the content
17sent corresponds to the content received.
   188.  An electronic transmission is received under this
19section even if no person is aware of its receipt.
   209.  A notice or other communication, if in a comprehensible
21form or manner, is effective at the earliest of the following:
   22a.  If in a physical form, the earliest of when it is
23actually received, or when it is left at any of the following:
   24(1)  A shareholder’s address shown on the corporation’s
25record of shareholders maintained by the corporation under
26section 490.1601, subsection 4.
   27(2)  A director’s residence or usual place of business.
   28(3)  The corporation’s principal office.
   29b.  If mailed by postage prepaid and correctly addressed to a
30shareholder, upon deposit in the United States mail.
   31c.  If mailed by United States mail postage prepaid and
32correctly addressed to a recipient other than a shareholder,
33the earliest of when it is actually received, or as follows:
   34(1)  If sent by registered or certified mail, return receipt
35requested, the date shown on the return receipt signed by or on
-20-1behalf of the addressee.
   2(2)  Five days after it is deposited in the United States
3mail.
   4d.  If an electronic transmission, when it is received as
5provided in subsection 6.
   6e.  If oral, when communicated.
   710.  A notice or other communication may be in the form of
8an electronic transmission that cannot be directly reproduced
9in paper form by the recipient through an automated process
10used in conventional commercial practice only if all of the
11following apply:
   12a.  The electronic transmission is otherwise retrievable in
13perceivable form.
   14b.  The sender and the recipient have consented in writing to
15the use of such form of electronic transmission.
   1611.  If this chapter prescribes requirements for notices
17or other communications in particular circumstances, those
18requirements govern. If articles of incorporation or bylaws
19prescribe requirements for notices or other communications,
20not inconsistent with this section or other provisions of
21this chapter, those requirements govern. The articles of
22incorporation or bylaws may authorize or require delivery of
23notices of meetings of directors by electronic transmission.
   2412.  In the event that any provisions of this chapter are
25deemed to modify, limit, or supersede the federal Electronic
26Signatures in Global and National Commerce Act, 15 U.S.C.
27§§7001 et seq., the provisions of this chapter shall control
28to the maximum extent permitted by section 102(a)(2) of that
29federal Act.
   3013.  a.  Whenever notice would otherwise be required to be
31given under any provision of this subchapter to a shareholder,
32such notice need not be given if any of the following apply:
   33(1)  Notices to the shareholders of two consecutive annual
34meetings, and all notices of meetings during the period between
35such two consecutive annual meetings, have been sent to such
-21-1shareholder at such shareholder’s address as shown on the
2records of the corporation and have been returned undeliverable
3or could not be delivered.
   4(2)  All, but not less than two, payments of dividends on
5securities during a twelve-month period, or two consecutive
6payments of dividends on securities during a period of more
7than twelve months, have been sent to such shareholder at
8such shareholder’s address as shown on the records of the
9corporation and have been returned undeliverable or could not
10be delivered.
   11b.  If any such shareholder shall deliver to the corporation
12a written notice setting forth such shareholder’s then-current
13address, the requirement that notice be given to such
14shareholder shall be reinstated.
15   Sec. 15.  Section 490.142, Code 2020, is amended by striking
16the section and inserting in lieu thereof the following:
   17490.142  Number of shareholders.
   181.  For purposes of this chapter, any of the following
19identified as a shareholder in a corporation’s current record
20of shareholders constitutes one shareholder:
   21a.  Three or fewer co-owners.
   22b.  A corporation, partnership, trust, estate, or other
23entity.
   24c.  The trustees, guardians, custodians, or other fiduciaries
25of a single trust, estate, or account.
   262.  For purposes of this chapter, shareholdings registered
27in substantially similar names constitute one shareholder if
28it is reasonable to believe that the names represent the same
29person.
30   Sec. 16.  Section 490.143, Code 2020, is amended by striking
31the section and inserting in lieu thereof the following:
   32490.143  Qualified director.
   331.  As used in this chapter, a “qualified director” means a
34director who takes action, if at the time action is to be taken
35any of the following applies:
-22-   1a.  Under section 490.202, subsection 2, paragraph “f”, is
2not a director under any of the following circumstances:
   3(1)  To whom the limitation or elimination of the duty of
4an officer to offer potential business opportunities to the
5corporation would apply.
   6(2)  Has a material relationship with any other person to
7whom the limitation or elimination described in subparagraph
8(1) would apply.
   9b.  Under section 490.744, does not have any of the
10following:
   11(1)  A material interest in the outcome of the proceeding.
   12(2)  A material relationship with a person who has such an
13interest.
   14c.  Under section 490.853 or 490.855, all of the following
15apply:
   16(1)  The director is not a party to the proceeding.
   17(2)  The director is not a director as to whom a transaction
18is a director’s conflicting interest transaction or who sought
19a disclaimer of the corporation’s interest in a business
20opportunity under section 490.870, which transaction or
21disclaimer is challenged in the proceeding.
   22(3)  The director does not have a material relationship with
23a director described in either subparagraph (1) or (2).
   24d.  Under section 490.862, the director is not any of the
25following:
   26(1)  A director as to whom the transaction is a director’s
27conflicting interest transaction.
   28(2)  A director who has a material relationship with another
29director as to whom the transaction is a director’s conflicting
30interest transaction.
   31e.  Under section 490.870, is not a director who does any of
32the following:
   33(1)  Pursues or takes advantage of the business opportunity,
34directly or indirectly through or on behalf of another person.
   35(2)  Has a material relationship with a director or officer
-23-1who pursues or takes advantage of the business opportunity,
2directly, or indirectly through or on behalf of another person.
   32.  As used in this section, all of the following apply:
   4a.  “Material interest” means an actual or potential
5benefit or detriment, other than one which would devolve on
6the corporation or the shareholders generally, that would
7reasonably be expected to impair the objectivity of the
8director’s judgment when participating in the action to be
9taken.
   10b.  “Material relationship” means a familial, financial,
11professional, employment, or other relationship that would
12reasonably be expected to impair the objectivity of the
13director’s judgment when participating in the action to be
14taken.
   153.  The presence of one or more of the following
16circumstances shall not automatically prevent a director from
17being a qualified director:
   18a.  Nomination or election of the director to the current
19board by any director who is not a qualified director with
20respect to the matter, or by any person that has a material
21relationship with that director, acting alone or participating
22with others.
   23b.  Service as a director of another corporation of which a
24director who is not a qualified director with respect to the
25matter, or any individual who has a material relationship with
26that director, is or was also a director.
   27c.  With respect to action to be taken under section 490.744,
28status as a named defendant, as a director against whom action
29is demanded, or as a director who approved the conduct being
30challenged.
31   Sec. 17.  Section 490.144, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.144  Householding.
   341.  A corporation has delivered written notice or any
35other report or statement under this chapter, the articles of
-24-1incorporation, or the bylaws to all shareholders who share a
2common address if all of the following apply:
   3a.  The corporation delivers one copy of the notice, report,
4or statement to the common address.
   5b.  The corporation addresses the notice, report, or
6statement to those shareholders either as a group or to each
7of those shareholders individually or to the shareholders in a
8form to which each of those shareholders has consented.
   9c.  Each of those shareholders consents to delivery of
10a single copy of such notice, report, or statement to the
11shareholders’ common address.
   122.  Any such consent described in subsection 1, paragraph
13“b” or “c”, shall be revocable by any of such shareholders who
14deliver written notice of revocation to the corporation. If
15such written notice of revocation is delivered, the corporation
16shall begin providing individual notices, reports, or other
17statements to the revoking shareholder no later than thirty
18days after delivery of the written notice of revocation.
   193.  Any shareholder who fails to object by written notice
20to the corporation, within sixty days of written notice by
21the corporation of its intention to deliver single copies of
22notices, reports, or statements to shareholders who share a
23common address as permitted by subsection 1, shall be deemed
24to have consented to receiving such single copy at the common
25address; provided that the notice of intention explains that
26consent may be revoked and the method for revoking.
27   Sec. 18.  NEW SECTION.  490.145  Part definitions.
   28As used in this part:
   291.  “Corporate action” means any action taken by or on
30behalf of the corporation, including any action taken by the
31incorporator, the board of directors, a committee of the board
32of directors, an officer or agent of the corporation, or the
33shareholders.
   342.  “Date of the defective corporate action” means the date
35or, if the defective corporate action occurred or may have
-25-1occurred on more than one date, the range of dates, or the
2approximate date or range of dates, if the exact date or range
3of dates is unknown or not readily ascertainable, the defective
4corporate action was purported to have been taken.
   53.  “Defective corporate action” means all of the following:
   6a.  Any corporate action purportedly taken that is, and at
7the time such corporate action was purportedly taken would
8have been, within the power of the corporation, but is void or
9voidable due to a failure of authorization.
   10b.  An overissue.
   114.  “Failure of authorization” means the failure to
12authorize, approve, or otherwise effect a corporate action in
13compliance with the provisions of this chapter, the articles of
14incorporation or bylaws, a corporate resolution, or any plan
15or agreement to which the corporation is a party, if and to the
16extent such failure would render such corporate action void or
17voidable.
   185.  “Overissue” means the purported issuance of any of the
19following:
   20a.  Shares of a class or series in excess of the number of
21shares of a class or series the corporation has the power to
22issue under section 490.601 at the time of such issuance.
   23b.  Shares of any class or series that is not then authorized
24for issuance by the articles of incorporation.
   256.  “Putative shares” means the shares of any class or
26series, including shares issued upon exercise of rights,
27options, warrants or other securities convertible into
28shares of the corporation, or interests with respect to such
29shares, that were created or issued as a result of a defective
30corporate action, and any of the following applies:
   31a.  But for any failure of authorization would constitute
32valid shares.
   33b.  Cannot be determined by the board of directors to be
34valid shares.
   357.  “Valid shares” means the shares of any class or series
-26-1that have been duly authorized and validly issued in accordance
2with this chapter, including as a result of ratification or
3validation under this part.
   48.  a.  “Validation effective time” with respect to any
5defective corporate action ratified under this part means the
6later of the following:
   7(1)  The time at which the ratification of the defective
8corporate action is approved by the shareholders, or if
9approval of shareholders is not required, the time at which
10the notice required by section 490.149 becomes effective in
11accordance with section 490.141.
   12(2)  The time at which any articles of validation filed in
13accordance with section 490.151 become effective.
   14b.  The validation effective time shall not be affected by
15the filing or pendency of a judicial proceeding under section
16490.152 or otherwise, unless otherwise ordered by the court.
17   Sec. 19.  NEW SECTION.  490.146  Defective corporate actions.
   181.  A defective corporate action shall not be void or
19voidable if ratified in accordance with section 490.147 or
20validated in accordance with section 490.152.
   212.  Ratification under section 490.147 or validation under
22section 490.152 shall not be deemed to be the exclusive means
23of ratifying or validating any defective corporate action, and
24the absence or failure of ratification in accordance with this
25part shall not, of itself, affect the validity or effectiveness
26of any corporate action properly ratified under common law or
27otherwise, nor shall it create a presumption that any such
28corporate action is or was a defective corporate action or void
29or voidable.
   303.  In the case of an overissue, putative shares shall be
31valid shares effective as of the date originally issued or
32purportedly issued upon any of the following:
   33a.  The effectiveness under this part and under subchapter X
34of an amendment to the articles of incorporation authorizing,
35designating, or creating such shares.
-27-   1b.  The effectiveness of any other corporate action under
2this part ratifying the authorization, designation, or creation
3of such shares.
4   Sec. 20.  NEW SECTION.  490.147  Ratification of defective
5corporate actions.
   61.  To ratify a defective corporate action under this
7section, other than the ratification of an election of the
8initial board of directors under subsection 2, the board of
9directors shall take action ratifying the action in accordance
10with section 490.148, stating all of the following:
   11a.  The defective corporate action to be ratified and, if the
12defective corporate action involved the issuance of putative
13shares, the number and type of putative shares purportedly
14issued.
   15b.  The date of the defective corporate action.
   16c.  The nature of the failure of authorization with respect
17to the defective corporate action to be ratified.
   18d.  That the board of directors approves the ratification of
19the defective corporate action.
   202.  In the event that a defective corporate action to be
21ratified relates to the election of the initial board of
22directors of the corporation under section 490.205, subsection
231, paragraph “b”, a majority of the persons who, at the time of
24the ratification, are exercising the powers of directors may
25take an action stating all of the following:
   26a.  The name of the person or persons who first took
27action in the name of the corporation as the initial board of
28directors of the corporation.
   29b.  The earlier of the date on which such persons first
30took such action or were purported to have been elected as the
31initial board of directors.
   32c.  That the ratification of the election of such person or
33persons as the initial board of directors is approved.
   343.  If any provision of this chapter, the articles of
35incorporation or bylaws, any corporate resolution, or any
-28-1plan or agreement to which the corporation is a party in
2effect at the time action under subsection 1 is taken requires
3shareholder approval or would have required shareholder
4approval at the date of the occurrence of the defective
5corporate action, the ratification of the defective corporate
6action approved in the action taken by the directors under
7subsection 1 shall be submitted to the shareholders for
8approval in accordance with section 490.148.
   94.  Unless otherwise provided in the action taken by the
10board of directors under subsection 1, after the action by the
11board of directors has been taken and, if required, approved
12by the shareholders, the board of directors may abandon the
13ratification at any time before the validation effective time
14without further action of the shareholders.
15   Sec. 21.  NEW SECTION.  490.148  Action on ratification.
   161.  The quorum and voting requirements applicable to a
17ratifying action by the board of directors under section
18490.147, subsection 1, shall be the quorum and voting
19requirements applicable to the corporate action proposed to be
20ratified at the time such ratifying action is taken.
   212.  If the ratification of the defective corporate action
22requires approval by the shareholders under section 490.147,
23subsection 3, and if the approval is to be given at a meeting,
24the corporation shall notify each holder of valid and putative
25shares, regardless of whether entitled to vote, as of the
26record date for notice of the meeting and as of the date of
27the occurrence of defective corporate action, provided that
28notice shall not be required to be given to holders of valid or
29putative shares whose identities or addresses for notice cannot
30be determined from the records of the corporation. The notice
31must state that the purpose, or one of the purposes, of the
32meeting is to consider ratification of a defective corporate
33action and must be accompanied by all of the following:
   34a.  Either a copy of the action taken by the board of
35directors in accordance with section 490.147, subsection 1,
-29-1or the information required by section 490.147, subsection 1,
2paragraphs “a” through “d”.
   3b.  A statement that any claim that the ratification of
4such defective corporate action and any putative shares issued
5as a result of such defective corporate action should not be
6effective, or should be effective only on certain conditions,
7shall be brought within one hundred twenty days from the
8applicable validation effective time.
   93.  Except as provided in subsection 4, with respect to the
10voting requirements to ratify the election of a director, the
11quorum and voting requirements applicable to the approval by
12the shareholders required by section 490.147, subsection 3,
13shall be the quorum and voting requirements applicable to the
14corporate action proposed to be ratified at the time of such
15shareholder approval.
   164.  The approval by shareholders to ratify the election of a
17director requires that the votes cast within the voting group
18favoring such ratification exceed the votes cast opposing such
19ratification of the election at a meeting at which a quorum is
20present.
   215.  Putative shares on the record date for determining
22the shareholders entitled to vote on any matter submitted to
23shareholders under section 490.147, subsection 3, and without
24giving effect to any ratification of putative shares that
25becomes effective as a result of such vote, shall neither be
26entitled to vote nor counted for quorum purposes in any vote to
27approve the ratification of any defective corporate action.
   286.  If the approval under this section of putative shares
29would result in an overissue, in addition to the approval
30required by section 490.147, approval of an amendment to the
31articles of incorporation under subchapter X to increase
32the number of shares of an authorized class or series or to
33authorize the creation of a class or series of shares so there
34would be no overissue shall also be required.
35   Sec. 22.  NEW SECTION.  490.149  Notice requirements.
-30-   11.  Unless shareholder approval is required under section
2490.147, subsection 3, prompt notice of an action taken under
3section 490.147 shall be given to each holder of valid and
4putative shares, regardless of whether entitled to vote, as of
5all of the following:
   6a.  The date of such action by the board of directors.
   7b.  The date of the defective corporate action ratified,
8provided that notice shall not be required to be given to
9holders of valid and putative shares whose identities or
10addresses for notice cannot be determined from the records of
11the corporation.
   122.  The notice must contain all of the following:
   13a.  Either a copy of the action taken by the board of
14directors in accordance with section 490.147, subsection 1 or
152, or the information required by section 490.147, subsection
161, paragraphs “a” through “d”, or section 490.147, subsection 2,
17paragraphs “a” through “c”, as applicable.
   18b.  A statement that any claim that the ratification of
19the defective corporate action and any putative shares issued
20as a result of such defective corporate action should not be
21effective, or should be effective only on certain conditions,
22shall be brought within one hundred twenty days from the
23applicable validation effective time.
   243.  No notice under this section is required with respect
25to any action required to be submitted to shareholders for
26approval under section 490.147, subsection 3, if notice is
27given in accordance with section 490.148, subsection 2.
   284.  A notice required by this section may be given in any
29manner permitted by section 490.141 and, for any corporation
30subject to the reporting requirements of section 13 or 15(d) of
31the federal Securities Exchange Act of 1934, may be given by
32means of a filing or furnishing of such notice with the United
33States securities and exchange commission.
34   Sec. 23.  NEW SECTION.  490.150  Effect of ratification.
   35From and after the validation effective time, and without
-31-1regard to the one hundred twenty-day period during which
2a claim may be brought under section 490.152, all of the
3following shall apply:
   41.  Each defective corporate action ratified in accordance
5with section 490.147 shall not be void or voidable as a result
6of the failure of authorization identified in the action taken
7under section 490.147, subsection 1 or 2, and shall be deemed
8a valid corporate action effective as of the date of the
9defective corporate action.
   102.  The issuance of each putative share or fraction of a
11putative share purportedly issued pursuant to a defective
12corporate action identified in the action taken under section
13490.147 shall not be void or voidable, and each such putative
14share or fraction of a putative share shall be deemed to be an
15identical share or fraction of a valid share as of the time it
16was purportedly issued.
   173.  Any corporate action taken subsequent to the defective
18corporate action ratified in accordance with this part in
19reliance on such defective corporate action having been
20validly effected and any subsequent defective corporate action
21resulting directly or indirectly from such original defective
22corporate action shall be valid as of the time taken.
23   Sec. 24.  NEW SECTION.  490.151  Filings.
   241.  If the defective corporate action ratified under this
25part would have required under any other section of this
26chapter a filing in accordance with this chapter, then,
27regardless of whether a filing was previously made in respect
28of such defective corporate action and in lieu of a filing
29otherwise required by this chapter, the corporation shall file
30articles of validation in accordance with this section, and
31such articles of validation shall serve to amend or substitute
32for any other filing with respect to such defective corporate
33action required by this chapter.
   342.  The articles of validation must set forth all of the
35following:
-32-   1a.  The defective corporate action that is the subject of the
2articles of validation, including in the case of any defective
3corporate action involving the issuance of putative shares, the
4number and type of putative shares issued and the date or dates
5upon which such putative shares were purported to have been
6issued.
   7b.  The date of the defective corporate action.
   8c.  The nature of the failure of authorization in respect of
9the defective corporate action.
   10d.  A statement that the defective corporate action was
11ratified in accordance with section 490.147, including
12the date on which the board of directors ratified such
13defective corporate action and the date, if any, on which
14the shareholders approved the ratification of such defective
15corporate action.
   16e.  The information required by subsection 3.
   173.  The articles of validation must also contain the
18following information:
   19a.  If a filing was previously made in respect of the
20defective corporate action and no changes to such filing are
21required to give effect to the ratification of such defective
22corporate action in accordance with section 490.147, the
23articles of validation must set forth all of the following:
   24(1)  The name, title, and filing date of the filing
25previously made and any articles of correction to that filing.
   26(2)  A statement that a copy of the filing previously made,
27together with any articles of correction to that filing, is
28attached as an exhibit to the articles of validation.
   29b.  If a filing was previously made in respect of the
30defective corporate action and such filing requires any change
31to give effect to the ratification of such defective corporate
32action in accordance with section 490.147, the articles of
33validation must set forth all of the following:
   34(1)  The name, title, and filing date of the filing
35previously made and any articles of correction to that filing.
-33-   1(2)  A statement that a filing containing all of the
2information required to be included under the applicable
3section or sections of this chapter to give effect to such
4defective corporate action is attached as an exhibit to the
5articles of validation.
   6(3)  The date and time that such filing is deemed to have
7become effective.
   8c.  If a filing was not previously made in respect of the
9defective corporate action and the defective corporate action
10ratified under section 490.147 would have required a filing
11under any other section of this chapter, the articles of
12validation must set forth all of the following:
   13(1)  A statement that a filing containing all of the
14information required to be included under the applicable
15section or sections of this chapter to give effect to such
16defective corporate action is attached as an exhibit to the
17articles of validation.
   18(2)  The date and time that such filing is deemed to have
19become effective.
20   Sec. 25.  NEW SECTION.  490.152  Judicial proceedings
21regarding validity of corporate actions.
   221.  Upon application by the corporation, any successor
23entity to the corporation, a director of the corporation, any
24shareholder, beneficial shareholder, or unrestricted voting
25trust beneficial owner of the corporation, including any
26such shareholder, beneficial shareholder, or unrestricted
27voting trust beneficial owner as of the date of the defective
28corporate action ratified under section 490.147, or any other
29person claiming to be substantially and adversely affected by a
30ratification under section 490.147, the district court of the
31county where a corporation’s principal office or, if none in
32this state, its registered office, is located may do all of the
33following:
   34a.  Determine the validity and effectiveness of any corporate
35action or defective corporate action.
-34-   1b.  Determine the validity and effectiveness of any
2ratification under section 490.147.
   3c.  Determine the validity of any putative shares.
   4d.  Modify or waive any of the procedures specified in
5section 490.147 or 490.148 to ratify a defective corporate
6action.
   72.  In connection with an action under this section, the
8court may make such findings or orders, and take into account
9any factors or considerations, regarding such matters as it
10deems proper under the circumstances.
   113.  Service of process of the application under subsection
121 on the corporation may be made in any manner provided by
13statute of this state or by rule of the applicable court for
14service on the corporation, and no other party need be joined
15in order for the court to adjudicate the matter. In an action
16filed by the corporation, the court may require notice of the
17action to be provided to other persons specified by the court
18and permit such other persons to intervene in the action.
   194.  Notwithstanding any other provision of this section or
20otherwise under applicable law, any action asserting that the
21ratification of any defective corporate action and any putative
22shares issued as a result of such defective corporate action
23should not be effective, or should be effective only on certain
24conditions, shall be brought within one hundred twenty days of
25the validation effective time.
26   Sec. 26.  Section 490.201, Code 2020, is amended by striking
27the section and inserting in lieu thereof the following:
   28490.201  Incorporators.
   29One or more persons may act as the incorporator or
30incorporators of a corporation by delivering articles of
31incorporation to the secretary of state for filing.
32   Sec. 27.  Section 490.202, Code 2020, is amended by striking
33the section and inserting in lieu thereof the following:
   34490.202  Articles of incorporation.
   351.  The articles of incorporation must set forth all of the
-35-1following:
   2a.  A corporate name for the corporation that satisfies the
3requirements of section 490.401.
   4b.  The number of shares the corporation is authorized to
5issue.
   6c.  The street and mailing addresses of the corporation’s
7initial registered office and the name of its initial
8registered agent at that office.
   9d.  The name and address of each incorporator.
   102.  The articles of incorporation may set forth any of the
11following:
   12a.  The names and addresses of the individuals who are to
13serve as the initial directors.
   14b.  Provisions not inconsistent with law regarding any of the
15following:
   16(1)  The purpose or purposes for which the corporation is
17organized.
   18(2)  Managing the business and regulating the affairs of the
19corporation.
   20(3)  Defining, limiting, and regulating the powers of the
21corporation, 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
24shareholders.
   25c.  Any provision that under this chapter is required or
26permitted to be set forth in the bylaws.
   27d.  A provision eliminating or limiting the liability
28of a director to the corporation or its shareholders for
29money damages for any action taken, or any failure to take
30any action, as a director, except liability for any of the
31following:
   32(1)  The amount of a financial benefit received by a director
33to which the director is not entitled.
   34(2)  An intentional infliction of harm on the corporation or
35the shareholders.
-36-   1(3)  A violation of section 490.833.
   2(4)  An intentional violation of criminal law.
   3e.  A provision permitting or making obligatory
4indemnification of a director for liability, as defined in
5section 490.850, to any person for any action taken, or any
6failure to take any action, as a director, except liability for
7any of the following:
   8(1)  Receipt of a financial benefit to which the director is
9not entitled.
   10(2)  An intentional infliction of harm on the corporation or
11its shareholders.
   12(3)  A violation of section 490.833.
   13(4)  An intentional violation of criminal law.
   14f.  A provision limiting or eliminating any duty of a
15director or any other person to offer the corporation the
16right to have or participate in any, or one or more classes
17or categories of, business opportunities, before the pursuit
18or taking of the opportunity by the director or other person;
19provided that any application of such a provision to an officer
20or a related person of that officer is subject to all of the
21following:
   22(1)  It also requires approval of that application by the
23board of directors, subsequent to the effective date of the
24provision, by action of qualified directors taken in compliance
25with the same procedures as are set forth in section 490.862.
   26(2)  It may be limited by the authorizing action of the
27board.
   283.  The articles of incorporation need not set forth any of
29the corporate powers enumerated in this chapter.
   304.  Provisions of the articles of incorporation may be made
31dependent upon facts objectively ascertainable outside the
32articles of incorporation in accordance with section 490.120,
33subsection 11.
   345.  As used in this section, “related person” has the meaning
35specified in section 490.860.
-37-1   Sec. 28.  Section 490.203, Code 2020, is amended by striking
2the section and inserting in lieu thereof the following:
   3490.203  Incorporation.
   41.  Unless a delayed effective date is specified, the
5corporate existence begins when the articles of incorporation
6are filed.
   72.  The secretary of state’s filing of the articles of
8incorporation is conclusive proof that the incorporators
9satisfied all conditions precedent to incorporation except in a
10proceeding by the state to cancel or revoke the incorporation
11or involuntarily dissolve the corporation.
12   Sec. 29.  Section 490.205, Code 2020, is amended by striking
13the section and inserting in lieu thereof the following:
   14490.205  Organization of corporation.
   151.  After incorporation, the following shall apply:
   16a.  If initial directors are named in the articles
17of incorporation, the initial directors shall hold an
18organizational meeting, at the call of a majority of the
19directors, to complete the organization of the corporation by
20appointing officers, adopting bylaws, and carrying on any other
21business brought before the meeting.
   22b.  If initial directors are not named in the articles of
23incorporation, the incorporator or incorporators shall hold
24an organizational meeting at the call of a majority of the
25incorporators to do any of the following:
   26(1)  Elect initial directors and complete the organization
27of the corporation.
   28(2)  Elect a board of directors who shall complete the
29organization of the corporation.
   302.  Action required or permitted by this chapter to be taken
31by incorporators at an organizational meeting may be taken
32without a meeting if the action taken is evidenced by one or
33more written consents describing the action taken and signed by
34each incorporator.
   353.  An organizational meeting may be held in or out of this
-38-1state.
2   Sec. 30.  Section 490.206, Code 2020, is amended by striking
3the section and inserting in lieu thereof the following:
   4490.206  Bylaws.
   51.  The incorporators or board of directors of a corporation
6shall adopt initial bylaws for the corporation.
   72.  The bylaws of a corporation may contain any provision
8that is not inconsistent with law or the articles of
9incorporation.
   103.  The bylaws may contain any of the following provisions:
   11a.  A requirement that if the corporation solicits proxies
12or consents with respect to an election of directors, the
13corporation include in its proxy statement and any form
14of its proxy or consent, to the extent and subject to such
15procedures or conditions as are provided in the bylaws, one
16or more individuals nominated by a shareholder in addition to
17individuals nominated by the board of directors.
   18b.  A requirement that the corporation reimburse the expenses
19incurred by a shareholder in soliciting proxies or consents in
20connection with an election of directors, to the extent and
21subject to such procedures and conditions as are provided in
22the bylaws, provided that no bylaw so adopted shall apply to
23elections for which any record date precedes its adoption.
   244.  Notwithstanding section 490.1020, subsection 2,
25paragraph “b”, the shareholders in amending, repealing, or
26adopting a bylaw described in subsection 3 shall not limit the
27authority of the board of directors to amend or repeal any
28condition or procedure set forth in or to add any procedure
29or condition to such a bylaw to provide for a reasonable,
30practical, and orderly process.
31   Sec. 31.  Section 490.207, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.207  Emergency bylaws.
   341.  Unless the articles of incorporation provide otherwise,
35the board of directors may adopt bylaws to be effective only in
-39-1an emergency as defined in subsection 4. The emergency bylaws,
2which are subject to amendment or repeal by the shareholders,
3may make all provisions necessary for managing the corporation
4during the emergency, including any of the following:
   5a.  Procedures for calling a meeting of the board of
6directors.
   7b.  Quorum requirements for the meeting.
   8c.  Designation of additional or substitute directors.
   92.  All provisions of the regular bylaws not inconsistent
10with the emergency bylaws remain effective during the
11emergency. The emergency bylaws are not effective after the
12emergency ends.
   133.  Corporate action taken in good faith in accordance with
14the emergency bylaws has all of the following effects:
   15a.  The action binds the corporation.
   16b.  The action shall not be used to impose liability on a
17director, officer, employee, or agent of the corporation.
   184.  An emergency exists for purposes of this section if a
19quorum of the board of directors cannot readily be assembled
20because of some catastrophic event.
21   Sec. 32.  NEW SECTION.  490.208  Forum selection provisions.
   221.  The articles of incorporation or bylaws may require
23that any or all internal corporate claims shall be brought
24exclusively in any specified court or courts of this state
25and, if so specified, in any additional courts in this state
26or in any other jurisdictions with which the corporation has a
27reasonable relationship.
   282.  A provision of the articles of incorporation or bylaws
29adopted under subsection 1 shall not have the effect of
30conferring jurisdiction on any court or over any person or
31claim, and shall not apply if none of the courts specified
32by such provision has the requisite personal and subject
33matter jurisdiction. If the court or courts of this state
34specified in a provision adopted under subsection 1 do not
35have the requisite personal and subject matter jurisdiction
-40-1and another court of this state does have such jurisdiction,
2then the internal corporate claim may be brought in such other
3court of this state, notwithstanding that such other court
4of this state is not specified in such provision, and in any
5other court specified in such provision that has the requisite
6jurisdiction.
   73.  No provision of the articles of incorporation or bylaws
8may prohibit bringing an internal corporate claim in the
9courts of this state or require such claims to be determined
10by arbitration.
   114.  “Internal corporate claim” means, for the purposes of
12this section, any of the following:
   13a.  Any claim that is based upon a violation of a duty
14under the laws of this state by a current or former director,
15officer, or shareholder in such capacity.
   16b.  Any derivative action or proceeding brought on behalf of
17the corporation.
   18c.  Any action asserting a claim arising pursuant to any
19provision of this chapter or the articles of incorporation or
20bylaws.
   21d.  Any action asserting a claim governed by the internal
22affairs doctrine that is not included in paragraphs “a” through
23“c”.
24   Sec. 33.  NEW SECTION.  490.209  Foreign-trade zone
25corporation.
   26A corporation may be organized under the laws of this state
27for the purpose of establishing, operating, and maintaining
28a foreign-trade zone as defined in 19 U.S.C.§81(a). A
29corporation organized for the purposes set forth in this
30section has all powers necessary or convenient for applying
31for a grant of authority to establish, operate, and maintain
32a foreign-trade zone under 19 U.S.C.§81(a) et seq., and
33regulations promulgated under that law, and for establishing,
34operating, and maintaining a foreign-trade zone pursuant to
35that grant of authority.
-41-1   Sec. 34.  Section 490.302, Code 2020, is amended by striking
2the section and inserting in lieu thereof the following:
   3490.302  General powers.
   4Unless its articles of incorporation provide otherwise,
5every corporation has perpetual duration and succession in its
6corporate name and has the same powers as an individual to do
7all things necessary or convenient to carry out its business
8and affairs, including the power to do all of the following:
   91.  Sue and be sued, complain, and defend in its corporate
10name.
   112.  Have a corporate seal, which may be altered at will, and
12to use it, or a facsimile of it, by impressing or affixing it or
13in any other manner reproducing it.
   143.  Make and amend bylaws, not inconsistent with its articles
15of incorporation or with the laws of this state, for managing
16the business and regulating the affairs of the corporation.
   174.  Purchase, receive, lease, or otherwise acquire, and own,
18hold, improve, use, and otherwise deal with, real or personal
19property, or any legal or equitable interest in property,
20wherever located.
   215.  Sell, convey, mortgage, pledge, lease, exchange, and
22otherwise dispose of all or any part of its property.
   236.  Purchase, receive, subscribe for, or otherwise acquire,
24own, hold, vote, use, sell, mortgage, lend, pledge, or
25otherwise dispose of, and deal in and with shares or other
26interests in, or obligations of, any other entity.
   277.  Make contracts and guarantees, incur liabilities,
28borrow money, issue its notes, bonds, and other securities
29and obligations, which may be convertible into or include the
30option to purchase other securities of the corporation, and
31secure any of its obligations by mortgage or pledge of any of
32its property, franchises, or income.
   338.  Lend money, invest and reinvest its funds, and receive
34and hold real and personal property as security for repayment.
   359.  Be a promoter, partner, member, associate, or manager of
-42-1any partnership, joint venture, trust, or other entity.
   210.  Conduct its business, locate offices, and exercise the
3powers granted by this chapter within or without this state.
   411.  Elect directors and appoint officers, employees, and
5agents of the corporation, define their duties, fix their
6compensation, and lend them money and credit.
   712.  Pay pensions and establish pension plans, pension
8trusts, profit sharing plans, share bonus plans, share option
9plans, and benefit or incentive plans for any or all of its
10current or former directors, officers, employees, and agents.
   1113.  Make donations for the public welfare or for charitable,
12scientific, or educational purposes.
   1314.  Transact any lawful business that will aid governmental
14policy.
   1515.  Make payments or donations, or do any other act, not
16inconsistent with law, that furthers the business and affairs
17of the corporation.
18   Sec. 35.  Section 490.303, Code 2020, is amended by striking
19the section and inserting in lieu thereof the following:
   20490.303  Emergency powers.
   211.  In anticipation of or during an emergency as defined in
22subsection 4, the board of directors of a corporation may do
23all of the following:
   24a.  Modify lines of succession to accommodate the incapacity
25of any director, officer, employee, or agent.
   26b.  Relocate the principal office, designate alternative
27principal offices or regional offices, or authorize the
28officers to do so.
   292.  During an emergency as defined in subsection 4, unless
30emergency bylaws provide otherwise:
   31a.  Notice of a meeting of the board of directors need be
32given only to those directors whom it is practicable to reach
33and may be given in any practicable manner.
   34b.  One or more officers of the corporation present at a
35meeting of the board of directors may be deemed to be directors
-43-1for the meeting, in order of rank and within the same rank in
2order of seniority, as necessary to achieve a quorum.
   33.  Corporate action taken in good faith during an emergency
4under this section to further the ordinary business affairs of
5the corporation shall both:
   6a.  Bind the corporation.
   7b.  Not be used to impose liability on a corporate director,
8officer, employee, or agent.
   94.  An emergency exists for purposes of this section if a
10quorum of the board of directors cannot readily be assembled
11because of some catastrophic event.
12   Sec. 36.  Section 490.401, Code 2020, is amended by striking
13the section and inserting in lieu thereof the following:
   14490.401  Corporate name.
   151.  A corporate name is subject to all of the following:
   16a.  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
19another language.
   20b.  It must not contain language stating or implying that
21the corporation is organized for a purpose other than that
22permitted by section 490.301 and its articles of incorporation.
   232.  Except as authorized by subsections 3 and 4, a corporate
24name must be distinguishable upon the records of the secretary
25of state from all of the following:
   26a.  The corporate name of a corporation incorporated in
27this state which is not administratively dissolved, or if such
28corporation has been administratively dissolved, within five
29years after the effective date of dissolution.
   30b.  A corporate name reserved or registered under section
31490.402 or 490.403 or any similar provision of the law of this
32state.
   33c.  The name of a foreign corporation registered to do
34business in this state or an alternate name adopted by a
35foreign corporation registered to do business in this state
-44-1because its corporate name is unavailable.
   2d.  The corporate name of a nonprofit corporation
3incorporated in this state which is not administratively
4dissolved.
   5e.  The name of a foreign nonprofit corporation registered
6to do business in this state or an alternate name adopted by a
7foreign nonprofit corporation registered to conduct activities
8in this state because its real name is unavailable.
   9f.  The name of a domestic filing entity which is not
10administratively dissolved.
   11g.  The name of a foreign unincorporated entity registered
12to do business in this state or an alternate name adopted by
13such an entity registered to conduct activities in this state
14because its real name is unavailable.
   15h.  A name reserved, registered, or protected as follows:
   16(1)  For a limited liability partnership, section 486A.1001
17or 486A.1002.
   18(2)  For a limited partnership, section 488.108, 488.109, or
19488.810.
   20(3)  For a business corporation, this section, or section
21490.402, 490.403, or 490.1422.
   22(4)  For a limited liability company under chapter 489,
23section 489.108, 489.109, or 489.706.
   24(5)  For a nonprofit corporation, section 504.401, 504.402,
25504.403, or 504.1423.
   263.  A corporation may apply to the secretary of state for
27authorization to use a name that is not distinguishable upon
28the secretary of state’s records from one or more of the names
29described in subsection 2. The secretary of state shall
30authorize use of the name applied for if any of the following
31conditions apply:
   32a.  The other corporation or unincorporated entity consents
33to the use in writing and submits an undertaking in form
34satisfactory to the secretary of state to change its name to a
35name that is distinguishable upon the records of the secretary
-45-1of state from the name of the applying corporation.
   2b.  The applicant delivers to the secretary of state a
3certified copy of the final judgment of a court of competent
4jurisdiction establishing the applicant’s right to use the name
5applied for in this state.
   64.  A corporation may use the name, including the fictitious
7name, of another domestic or foreign corporation that is used
8in this state if the other corporation is incorporated or
9authorized to transact business in this state and the proposed
10user corporation submits documentation to the satisfaction
11of the secretary of state establishing any of the following
12conditions:
   13a.  Has merged with the other corporation.
   14b.  Has been formed by reorganization of the other
15corporation.
   16c.  Has acquired all or substantially all of the assets,
17including the corporate name, of the other corporation.
   185.  This chapter does not control the use of fictitious
19names; however, if a corporation or a foreign corporation
20uses a fictitious name in this state, it shall deliver to the
21secretary of state for filing a copy of the resolution of its
22board of directors, certified by its secretary, adopting the
23fictitious name.
24   Sec. 37.  Section 490.402, Code 2020, is amended by striking
25the section and inserting in lieu thereof the following:
   26490.402  Reserved name.
   271.  A person may reserve the exclusive use of a corporate
28name, including a fictitious or alternate name for a foreign
29corporation whose corporate name is not available, by
30delivering an application to the secretary of state for
31filing. The application must set forth the name and address
32of the applicant and the name proposed to be reserved. If the
33secretary of state finds that the corporate name applied for is
34available, the secretary of state shall reserve the name for
35the applicant’s exclusive use for a nonrenewable one hundred
-46-1twenty-day period.
   22.  The owner of a reserved corporate name may transfer the
3reservation to another person by delivering to the secretary of
4state a signed notice of the transfer that states the name and
5address of the transferee.
6   Sec. 38.  Section 490.403, Code 2020, is amended by striking
7the section and inserting in lieu thereof the following:
   8490.403  Registered name.
   91.  A foreign corporation may register its corporate
10name, or its corporate name with the addition of any word
11or abbreviation listed in section 490.401, subsection 1,
12paragraph “a”, if necessary for the corporate name to comply
13with section 490.401, subsection 1, paragraph “a”, if the name
14is distinguishable upon the records of the secretary of state
15from the corporate names that are not available under section
16490.401, subsection 2.
   172.  A foreign corporation registers its corporate name, or
18its corporate name with any addition permitted by subsection
191, by delivering to the secretary of state for filing an
20application that complies with all of the following:
   21a.  Sets forth that name, the state or country and date of
22its incorporation, and a brief description of the nature of the
23business which is to be conducted in this state.
   24b.  Is accompanied by a certificate of existence, or a
25document of similar import, from the state or country of
26incorporation.
   273.  The name is registered for the applicant’s exclusive
28use upon the effective date of the application and for the
29remainder of the calendar year, unless renewed.
   304.  A foreign corporation whose name registration is
31effective may renew it for successive years by delivering
32to the secretary of state for filing a renewal application,
33which complies with the requirements of subsection 2, between
34October 1 and December 31 of the preceding year. The renewal
35application when filed renews the registration for the
-47-1following calendar year.
   25.  a.  A foreign corporation whose name registration is
3effective may thereafter do any of the following:
   4(1)  Register to do business as a foreign corporation under
5the registered name, if it complies with section 490.401,
6subsection 1, paragraph “b”.
   7(2)  Consent in writing to the use of that name by a domestic
8corporation thereafter incorporated under this chapter or by
9another foreign corporation.
   10b.  The registration terminates when the domestic corporation
11is incorporated or the foreign corporation registers to do
12business under that name.
13   Sec. 39.  Section 490.501, Code 2020, is amended by striking
14the section and inserting in lieu thereof the following:
   15490.501  Registered office and agent of domestic and
16registered foreign corporations.
   171.  Each corporation shall continuously maintain in this
18state all of the following:
   19a.  A registered office that may be the same as any of its
20places of business.
   21b.  A registered agent, which may be any of the following:
   22(1)  An individual who resides in this state and whose
23business office is identical with the registered office.
   24(2)  A domestic or foreign corporation or eligible entity
25whose business office is identical with the registered office
26and, in the case of a foreign corporation or foreign eligible
27entity, is registered to do business in this state.
   282.  As used in this subchapter, “corporation” means both a
29domestic corporation and a registered foreign corporation.
30   Sec. 40.  Section 490.502, Code 2020, is amended by striking
31the section and inserting in lieu thereof the following:
   32490.502  Change of registered office or registered agent.
   331.  A corporation may change its registered office or
34registered agent by delivering to the secretary of state
35for filing a statement of change that sets forth all of the
-48-1following:
   2a.  The name of the corporation.
   3b.  The street and mailing addresses of its current
4registered office.
   5c.  If the current registered office is to be changed, the
6street and mailing addresses of the new registered office.
   7d.  The name of its current registered agent.
   8e.  If the current registered agent is to be changed, the
9name of the new registered agent and the new agent’s written
10consent, either on the statement or attached to it, to the
11appointment.
   12f.  That after the change or changes are made, the street and
13mailing addresses of its registered office and of the business
14office of its registered agent will be identical.
   152.  If the street or mailing address of a registered agent’s
16business office changes, the agent shall change the street or
17mailing address of the registered office of any corporation for
18which the agent is the registered agent by delivering a signed
19written notice of the change to the corporation and delivering
20to the secretary of state for filing a signed statement that
21complies with the requirements of subsection 1 and states that
22the corporation has been notified of the change.
   233.  If a registered agent changes the registered agent’s
24business address to another place, the registered agent may
25change the business address and the address of the registered
26agent by filing a statement as required in subsection 2 for
27each corporation, or a single statement for all corporations
28named in the notice, except that it need be signed only by the
29registered agent and need not be responsive to subsection 1,
30paragraph “e”, and must recite that a copy of the statement has
31been mailed to each corporation named in the notice.
   324.  A corporation may also change its registered office or
33registered agent in its biennial report as provided in section
34490.1622.
35   Sec. 41.  Section 490.503, Code 2020, is amended by striking
-49-1the section and inserting in lieu thereof the following:
   2490.503  Resignation of registered agent.
   31.  A registered agent may resign as agent for a corporation
4by delivering to the secretary of state for filing a statement
5of resignation signed by the agent which shall state all of the
6following:
   7a.  The name of the corporation.
   8b.  The name of the agent.
   9c.  The agent resigns from serving as registered agent for
10the corporation.
   11d.  The address of the corporation to which the agent will
12deliver the notice required by subsection 3.
   132.  A statement of resignation takes effect on the earlier
14of the following:
   15a.  12:01 a.m.on the thirty-first day after the day on which
16it is filed by the secretary of state.
   17b.  The designation of a new registered agent for the
18corporation.
   193.  A registered agent promptly shall deliver to the
20corporation notice of the date on which a statement of
21resignation was delivered to the secretary of state for filing.
   224.  When a statement of resignation takes effect, the person
23that resigned ceases to have responsibility under this chapter
24for any matter thereafter tendered to it as agent for the
25corporation. The resignation does not affect any contractual
26rights the corporation has against the agent or that the agent
27has against the corporation.
   285.  A registered agent may resign with respect to a
29corporation regardless of whether the corporation is in good
30standing.
31   Sec. 42.  Section 490.504, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.504  Service on corporation.
   341.  A corporation’s registered agent is the corporation’s
35agent for service of process, notice, or demand required or
-50-1permitted by law to be served on the corporation.
   22.  If a corporation has no registered agent, or the agent
3cannot with reasonable diligence be served, the corporation
4may be served by registered or certified mail, return receipt
5requested, addressed to the secretary at the corporation’s
6principal office. Service is perfected under this subsection
7at the earliest of the following:
   8a.  The date the corporation receives the mail.
   9b.  The date shown on the return receipt, if signed on behalf
10of the corporation.
   11c.  Five days after its deposit in the United States mail,
12as evidenced by the postmark, if mailed postpaid and correctly
13addressed.
   143.  a.  The secretary of state shall be an agent of the
15corporation upon whom process, notice, or demand may be served,
16if any of the following applies:
   17(1)  The process, notice, or demand cannot be served on a
18corporation pursuant to subsection 1 or 2.
   19(2)  The process, notice, or demand is to be served on
20a registered foreign corporation that has withdrawn its
21registration pursuant to section 490.1507 or 490.1509, or the
22registration of which has been terminated pursuant to section
23490.1511.
   24b.  Service of any process, notice, or demand on the
25secretary of state as agent for a corporation may be made by
26delivering to the secretary of state duplicate copies of the
27process, notice, or demand. If process, notice, or demand
28is served on the secretary of state, the secretary of state
29shall forward one of the copies by registered or certified
30mail, return receipt requested, to the corporation at the
31last address shown in the records of the secretary of state.
32Service is effected under this subsection at the earliest of
33the following:
   34(1)  The date the corporation receives the process, notice,
35or demand.
-51-   1(2)  The date shown on the return receipt, if signed on
2behalf of the corporation.
   3(3)  Five days after the process, notice, or demand is
4deposited with the United States mail by the secretary of
5state.
   64.  This section does not prescribe the only means, or
7necessarily the required means, of serving a corporation.
8   Sec. 43.  Section 490.601, Code 2020, is amended by striking
9the section and inserting in lieu thereof the following:
   10490.601  Authorized shares.
   111.  The articles of incorporation must set forth any classes
12of shares and series of shares within a class, and the number
13of shares of each class and series, that the corporation is
14authorized to issue. If more than one class or series of
15shares is authorized, the articles of incorporation must
16prescribe a distinguishing designation for each class or series
17and, before the issuance of shares of a class or series,
18describe the terms, including the preferences, rights, and
19limitations of that class or series. Except to the extent
20varied as permitted by this section, all shares of a class or
21series must have terms, including preferences, rights, and
22limitations that are identical with those of other shares of
23the same class or series.
   242.  The articles of incorporation must authorize all of the
25following:
   26a.  One or more classes or series of shares that together
27have full voting rights.
   28b.  One or more classes or series of shares, which may be
29the same class, classes, or series as those with voting rights,
30that together are entitled to receive the net assets of the
31corporation upon dissolution.
   323.  The articles of incorporation may authorize one or more
33classes or series of shares that have any of the following
34characteristics:
   35a.  Have special, conditional, or limited voting rights, or
-52-1no right to vote, except to the extent otherwise provided by
2this chapter.
   3b.  Are redeemable or convertible as specified in the
4articles of incorporation in any of the following ways:
   5(1)  At the option of the corporation, the shareholder, or
6another 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
9accordance with a formula.
   10c.  Entitle the holders to distributions calculated in
11any manner, including dividends that may be cumulative,
12noncumulative, or partially cumulative.
   13d.  Have preference over any other class or series of shares
14with respect to distributions, including distributions upon the
15dissolution of the corporation.
   164.  The terms of shares may be made dependent upon facts
17objectively ascertainable outside the articles of incorporation
18in accordance with section 490.120, subsection 11.
   195.  Any of the terms of shares may vary among holders of the
20same class or series so long as such variations are expressly
21set forth in the articles of incorporation.
   226.  The description of the preferences, rights, and
23limitations of classes or series of shares in subsection 3 is
24not exhaustive.
25   Sec. 44.  Section 490.602, Code 2020, is amended by striking
26the section and inserting in lieu thereof the following:
   27490.602  Terms of class or series determined by board of
28directors.
   291.  If the articles of incorporation so provide, the board
30of directors is authorized, without shareholder approval, to
31do any of the following:
   32a.  Classify any unissued shares into one or more classes or
33into one or more series within a class.
   34b.  Reclassify any unissued shares of any class into one
35or more classes or into one or more series within one or more
-53-1classes.
   2c.  Reclassify any unissued shares of any series of any class
3into one or more classes or into one or more series within a
4class.
   52.  If the board of directors acts pursuant to subsection
61, it shall determine the terms, including the preferences,
7rights, and limitations, to the same extent permitted under
8section 490.601, of any of the following:
   9a.  Any class of shares before the issuance of any shares of
10that class.
   11b.  Any series within a class before the issuance of any
12shares of that series.
   133.  Before issuing any shares of a class or series created
14under this section, the corporation shall deliver to the
15secretary of state for filing articles of amendment setting
16forth the terms determined under subsection 1.
17   Sec. 45.  Section 490.603, Code 2020, is amended by striking
18the section and inserting in lieu thereof the following:
   19490.603  Issued and outstanding shares.
   201.  A corporation may issue the number of shares of each
21class or series authorized by the articles of incorporation.
22Shares that are issued are outstanding shares until they are
23reacquired, redeemed, converted, or canceled.
   242.  The reacquisition, redemption, or conversion of
25outstanding shares is subject to the limitations of subsection
263 and to section 490.640.
   273.  At all times that shares of the corporation are
28outstanding, one or more shares that together have full voting
29rights and one or more shares that together are entitled to
30receive the net assets of the corporation upon dissolution must
31be outstanding.
32   Sec. 46.  Section 490.604, Code 2020, is amended by striking
33the section and inserting in lieu thereof the following:
   34490.604  Fractional shares.
   351.  A corporation may issue fractions of a share or in lieu
-54-1of doing so may do any of the following:
   2a.  Pay in cash the value of fractions of a share.
   3b.  Issue scrip in registered or bearer form entitling the
4holder to receive a full share upon surrendering enough scrip
5to equal a full share.
   6c.  Arrange for disposition of fractional shares by the
7holders of such shares.
   82.  Each certificate representing scrip must be
9conspicuously labeled “scrip” and must contain the information
10required by section 490.625, subsection 2.
   113.  The holder of a fractional share is entitled to exercise
12the rights of a shareholder, including the rights to vote,
13to receive dividends, and to receive distributions upon
14dissolution. The holder of scrip is not entitled to any of
15these rights unless the scrip provides for them.
   164.  The board of directors may authorize the issuance of
17scrip subject to any condition, including any of the following:
   18a.  That the scrip will become void if not exchanged for full
19shares before a specified date.
   20b.  That the shares for which the scrip is exchangeable may
21be sold and the proceeds paid to the scripholders.
22   Sec. 47.  Section 490.620, Code 2020, is amended by striking
23the section and inserting in lieu thereof the following:
   24490.620  Subscription for shares before incorporation.
   251.  A subscription for shares entered into before
26incorporation is irrevocable for six months unless the
27subscription agreement provides a longer or shorter period or
28all the subscribers agree to revocation.
   292.  The board of directors may determine the payment terms
30of subscriptions for shares that were entered into before
31incorporation, unless the subscription agreement specifies
32them. A call for payment by the board of directors must be
33uniform so far as practicable as to all shares of the same
34class or series, unless the subscription agreement specifies
35otherwise.
-55-   13.  Shares issued pursuant to subscriptions entered into
2before incorporation are fully paid and nonassessable when
3the corporation receives the consideration specified in the
4subscription agreement.
   54.  If a subscriber defaults in payment of cash or
6property under a subscription agreement entered into before
7incorporation, the corporation may collect the amount owed
8as any other debt. Alternatively, unless the subscription
9agreement provides otherwise, the corporation may rescind the
10agreement and may sell the shares if the debt remains unpaid
11for more than twenty days after the corporation delivers a
12written demand for payment to the subscriber.
   135.  A subscription agreement entered into after
14incorporation is a contract between the subscriber and the
15corporation subject to section 490.621.
16   Sec. 48.  Section 490.621, Code 2020, is amended by striking
17the section and inserting in lieu thereof the following:
   18490.621  Issuance of shares.
   191.  The powers granted in this section to the board of
20directors may be reserved to the shareholders by the articles
21of incorporation.
   222.  The board of directors may authorize shares to be issued
23for consideration consisting of any tangible or intangible
24property or benefit to the corporation, including cash,
25promissory notes, services performed, contracts for services to
26be performed, or other securities of the corporation.
   273.  Before the corporation issues shares, the board of
28directors shall determine that the consideration received or
29to be received for shares to be issued is adequate. That
30determination by the board of directors is conclusive insofar
31as the adequacy of consideration for the issuance of shares
32relates to whether the shares are validly issued, fully paid,
33and nonassessable.
   344.  When the corporation receives the consideration for
35which the board of directors authorized the issuance of shares,
-56-1the shares issued therefor are fully paid and nonassessable.
   25.  The corporation may place in escrow shares issued for
3a contract for future services or benefits or a promissory
4note, or make other arrangements to restrict the transfer of
5the shares, and may credit distributions in respect of the
6shares against their purchase price, until the services are
7performed, the benefits are received, or the note is paid. If
8the services are not performed, the benefits are not received,
9or the note is not paid, the shares escrowed or restricted and
10the distributions credited may be canceled in whole or part.
   116.  a.  An issuance of shares or other securities convertible
12into or rights exercisable for shares in a transaction or
13a series of integrated transactions requires approval of
14the shareholders, at a meeting at which a quorum consisting
15of a majority, or such greater number as the articles of
16incorporation may prescribe, of the votes entitled to be cast
17on the matter exists, if all of the following conditions are
18satisfied:
   19(1)  The shares, other securities, or rights are to be issued
20for consideration other than cash or cash equivalents.
   21(2)  The voting power of shares that are issued and issuable
22as a result of the transaction or series of integrated
23transactions will comprise more than twenty percent of the
24voting power of the shares of the corporation that were
25outstanding immediately before the transaction.
   26b.  For purposes of this subsection, the following shall
27apply:
   28(1)  For purposes of determining the voting power of shares
29issued and issuable as a result of a transaction or series of
30integrated transactions, the voting power of shares or other
31securities convertible into or rights exercisable for shares
32shall be the greater of the following:
   33(a)  The voting power of the shares to be issued.
   34(b)  The voting power of the shares that would be outstanding
35after giving effect to the conversion of convertible shares and
-57-1other securities and the exercise of rights to be issued.
   2(2)  A series of transactions is integrated only if
3consummation of one transaction is made contingent on
4consummation of one or more of the other transactions.
5   Sec. 49.  Section 490.622, Code 2020, is amended by striking
6the section and inserting in lieu thereof the following:
   7490.622  Liability of shareholders.
   81.  A purchaser from a corporation of the corporation’s own
9shares is not liable to the corporation or its creditors with
10respect to the shares except to pay the consideration for which
11the shares were authorized to be issued or specified in the
12subscription agreement.
   132.  A shareholder of a corporation is not personally liable
14for any liabilities of the corporation, including liabilities
15arising from acts of the corporation, subject to the following
16exceptions:
   17a.  To the extent provided in a provision of the articles
18of incorporation permitted by section 490.202, subsection 2,
19paragraph “b”, subparagraph (5).
   20b.  A shareholder may become personally liable by reason of
21the shareholder’s own acts or conduct.
22   Sec. 50.  Section 490.623, Code 2020, is amended by striking
23the section and inserting in lieu thereof the following:
   24490.623  Share dividends.
   251.  Unless the articles of incorporation provide otherwise,
26shares may be issued pro rata and without consideration to the
27corporation’s shareholders or to the shareholders of one or
28more classes or series of shares. An issuance of shares under
29this subsection is a share dividend.
   302.  Shares of one class or series shall not be issued as a
31share dividend in respect of shares of another class or series
32unless one or more of the following conditions are met:
   33a.  The articles of incorporation so authorize.
   34b.  A majority of the votes entitled to be cast by the class
35or series to be issued approve the issue.
-58-   1c.  There are no outstanding shares of the class or series
2to be issued.
   33.  The board of directors may fix the record date for
4determining shareholders entitled to a share dividend, which
5date shall not be retroactive. If the board of directors does
6not fix the record date for determining shareholders entitled
7to a share dividend, the record date is the date the board of
8directors authorizes the share dividend.
9   Sec. 51.  Section 490.624, Code 2020, is amended by striking
10the section and inserting in lieu thereof the following:
   11490.624  Share rights, options, warrants, and awards.
   121.  A corporation may issue rights, options, or warrants for
13the purchase of shares or other securities of the corporation.
14The board of directors shall determine the terms and conditions
15upon which the rights, options, or warrants are issued and the
16terms, including the consideration for which the shares or
17other securities are to be issued. The authorization by the
18board of directors for the corporation to issue such rights,
19options, or warrants constitutes authorization of the issuance
20of the shares or other securities for which the rights,
21options, or warrants are exercisable.
   222.  The terms and conditions of such rights, options, or
23warrants may include restrictions or conditions that do any of
24the following:
   25a.  Preclude or limit the exercise, transfer, or receipt
26of such rights, options, or warrants by any person or
27persons owning or offering to acquire a specified number or
28percentage of the outstanding shares or other securities of the
29corporation or by any transferee or transferees of any such
30person or persons.
   31b.  Invalidate or void such rights, options, or warrants
32held by any such person or persons or any such transferee or
33transferees.
   343.  The board of directors may authorize one or more officers
35to do any of the following:
-59-   1a.  Designate the recipients of rights, options, warrants,
2or other equity compensation awards that involve the issuance
3of shares.
   4b.  Determine, within an amount and subject to any other
5limitations established by the board of directors and, if
6applicable, the shareholders, the number of such rights,
7options, warrants, or other equity compensation awards and
8the terms of such rights, options, warrants, or awards to be
9received by the recipients, provided that an officer shall
10not use such authority to designate the officer or any other
11persons as the board of directors may specify as a recipient of
12such rights, options, warrants, or other equity compensation
13awards.
14   Sec. 52.  Section 490.625, Code 2020, is amended by striking
15the section and inserting in lieu thereof the following:
   16490.625  Form and content of certificates.
   171.  Shares may, but need not, be represented by certificates.
18Unless this chapter or another statute expressly provides
19otherwise, the rights and obligations of shareholders are
20identical regardless of whether their shares are represented by
21certificates.
   222.  At a minimum, each share certificate must state on its
23face all of the following:
   24a.  The name of the corporation and that it is organized
25under the law of this state.
   26b.  The name of the person to whom issued.
   27c.  The number and class of shares and the designation of the
28series, if any, the certificate represents.
   293.  a.  If the corporation is authorized to issue different
30classes of shares or series of shares within a class, the
31front or back of each certificate must summarize all of the
32following:
   33(1)  The preferences, rights, and limitations applicable to
34each class and series.
   35(2)  Any variations in preferences, rights, and limitations
-60-1among the holders of the same class or series.
   2(3)  The authority of the board of directors to determine the
3terms of future classes or series.
   4b.  Alternatively, each certificate may state conspicuously
5on its front or back that the corporation will furnish the
6shareholder this information on request in writing and without
7charge.
   84.  Each share certificate must be signed by two officers
9designated in the bylaws.
   105.  If the person who signed a share certificate no longer
11holds office when the certificate is issued, the certificate
12is nevertheless valid.
13   Sec. 53.  Section 490.626, Code 2020, is amended by striking
14the section and inserting in lieu thereof the following:
   15490.626  Shares without certificates.
   161.  Unless the articles of incorporation or bylaws provide
17otherwise, the board of directors of a corporation may
18authorize the issuance of some or all of the shares of any
19or all of its classes or series without certificates. The
20authorization does not affect shares already represented by
21certificates until they are surrendered to the corporation.
   222.  Within a reasonable time after the issuance or transfer
23of shares without certificates, the corporation shall deliver
24to the shareholder a written statement of the information
25required on certificates by section 490.625, subsections 2 and
263, and, if applicable, section 490.627.
27   Sec. 54.  Section 490.627, Code 2020, is amended by striking
28the section and inserting in lieu thereof the following:
   29490.627  Restriction on transfer of shares.
   301.  The articles of incorporation, the bylaws, an agreement
31among shareholders, or an agreement between shareholders
32and the corporation may impose restrictions on the transfer
33or registration of transfer of shares of the corporation.
34A restriction does not affect shares issued before the
35restriction was adopted unless the holders of the shares are
-61-1parties to the restriction agreement or voted in favor of the
2restriction.
   32.  A restriction on the transfer or registration of transfer
4of shares is valid and enforceable against the holder or a
5transferee of the holder if the restriction is authorized
6by this section and its existence is noted conspicuously
7on the front or back of the certificate or is contained
8in the information statement required by section 490.626,
9subsection 2. Unless so noted, or contained, a restriction
10is not enforceable against a person without knowledge of the
11restriction.
   123.  A restriction on the transfer or registration of transfer
13of shares is authorized for any of the following purposes:
   14a.  To maintain the corporation’s status when it is dependent
15on the number or identity of its shareholders.
   16b.  To preserve exemptions under federal or state securities
17law.
   18c.  For any other reasonable purpose.
   194.  A restriction on the transfer or registration of transfer
20of shares may do any of the following:
   21a.  Obligate the shareholder first to offer the corporation
22or other persons, separately, consecutively, or simultaneously,
23an opportunity to acquire the restricted shares.
   24b.  Obligate the corporation or other persons, separately,
25consecutively, or simultaneously, to acquire the restricted
26shares.
   27c.  Require the corporation, the holders of any class or
28series of its shares, or other persons to approve the transfer
29of the restricted shares, if the requirement is not manifestly
30unreasonable.
   31d.  Prohibit the transfer of the restricted shares to
32designated persons or classes of persons, if the prohibition
33is not manifestly unreasonable.
   345.  As used in this section, “shares” includes a security
35convertible into or carrying a right to subscribe for or
-62-1acquire shares.
2   Sec. 55.  Section 490.630, Code 2020, is amended by striking
3the section and inserting in lieu thereof the following:
   4490.630  Shareholders’ preemptive rights.
   51.  The shareholders of a corporation do not have a
6preemptive right to acquire the corporation’s unissued shares
7except to the extent the articles of incorporation so provide.
   82.  A statement included in the articles of incorporation
9that “the corporation elects to have preemptive rights”, or
10words of similar effect, means that the following principles
11apply except to the extent the articles of incorporation
12expressly provide otherwise:
   13a.  The shareholders of the corporation have a preemptive
14right, granted on uniform terms and conditions prescribed
15by the board of directors to provide a fair and reasonable
16opportunity to exercise the right, to acquire proportional
17amounts of the corporation’s unissued shares upon the decision
18of the board of directors to issue them.
   19b.  A preemptive right may be waived by a shareholder. A
20waiver evidenced by a writing is irrevocable even though it is
21not supported by consideration.
   22c.  There is no preemptive right with respect to any of the
23following:
   24(1)  Shares issued as compensation to directors, officers,
25employees, or agents of the corporation, its subsidiaries, or
26its affiliates.
   27(2)  Shares issued to satisfy conversion or option rights
28created to provide compensation to directors, officers,
29employees, or agents of the corporation, its subsidiaries, or
30its affiliates.
   31(3)  Shares authorized in the articles of incorporation
32that are issued within six months from the effective date of
33incorporation.
   34(4)  Shares sold otherwise than for cash.
   35d.  Holders of shares of any class or series without voting
-63-1power but with preferential rights to distributions have no
2preemptive rights with respect to shares of any class or
3series.
   4e.  Holders of shares of any class or series with voting
5power but without preferential rights to distributions have no
6preemptive rights with respect to shares of any class or series
7with preferential rights to distributions unless the shares
8with preferential rights are convertible into or carry a right
9to subscribe for or acquire the shares without preferential
10rights.
   11f.  Shares subject to preemptive rights that are not acquired
12by shareholders may be issued to any person for a period of one
13year after being offered to shareholders at a consideration
14set by the board of directors that is not lower than the
15consideration set for the exercise of preemptive rights. An
16offer at a lower consideration or after the expiration of one
17year is subject to the shareholders’ preemptive rights.
   183.  As used in this section, “shares” includes a security
19convertible into or carrying a right to subscribe for or
20acquire shares.
21   Sec. 56.  Section 490.640, Code 2020, is amended by striking
22the section and inserting in lieu thereof the following:
   23490.640  Distribution to shareholders.
   241.  A board of directors may authorize and the corporation
25may make distributions to its shareholders subject to
26restriction by the articles of incorporation and the limitation
27in subsection 3.
   282.  The board of directors may fix the record date for
29determining shareholders entitled to a distribution, which
30date shall not be retroactive. If the board of directors does
31not fix a record date for determining shareholders entitled
32to a distribution, other than one involving a purchase,
33redemption, or other acquisition of the corporation’s shares,
34the record date is the date the board of directors authorizes
35the distribution.
-64-   13.  A distribution shall not be made if, after giving it
2effect, any of the following would result:
   3a.  The corporation would not be able to pay its debts as
4they become due in the usual course of business.
   5b.  The corporation’s total assets would be less than
6the sum of its total liabilities plus, unless the articles
7of incorporation permit otherwise, the amount that would be
8needed, if the corporation were to be dissolved at the time
9of the distribution, to satisfy the preferential rights upon
10dissolution of shareholders whose preferential rights are
11superior to those receiving the distribution.
   124.  The board of directors may base a determination
13that a distribution is not prohibited under subsection 3
14either on financial statements prepared on the basis of
15accounting practices and principles that are reasonable in the
16circumstances or on a fair valuation or other method that is
17reasonable in the circumstances.
   185.  Except as provided in subsection 7, the effect of a
19distribution under subsection 3 is measured as follows:
   20a.  In the case of distribution by purchase, redemption,
21or other acquisition of the corporation’s shares, as of the
22earlier of the following:
   23(1)  The date cash or other property is transferred or debt
24to a shareholder is incurred by the corporation.
   25(2)  The date the shareholder ceases to be a shareholder with
26respect to the acquired shares.
   27b.  In the case of any other distribution of indebtedness, as
28of the date the indebtedness is distributed.
   29c.  In all other cases, as of the following:
   30(1)  The date the distribution is authorized if the payment
31occurs within one hundred twenty days after the date of
32authorization.
   33(2)  The date the payment is made if it occurs more than one
34hundred twenty days after the date of authorization.
   356.  A corporation’s indebtedness to a shareholder incurred
-65-1by reason of a distribution made in accordance with this
2section is at parity with the corporation’s indebtedness to its
3general, unsecured creditors except to the extent subordinated
4by agreement.
   57.  Indebtedness of a corporation, including indebtedness
6issued as a distribution, is not considered a liability for
7purposes of determinations under subsection 3 if its terms
8provide that payment of principal and interest are made
9only if and to the extent that payment of a distribution to
10shareholders could then be made under this section. If such
11indebtedness is issued as a distribution, each payment of
12principal or interest is treated as a distribution, the effect
13of which is measured on the date the payment is actually made.
   148.  This section shall not apply to distributions in
15liquidation under subchapter XIV.
16   Sec. 57.  Section 490.701, Code 2020, is amended by striking
17the section and inserting in lieu thereof the following:
   18490.701  Annual meeting.
   191.  Unless directors are elected by written consent in
20lieu of an annual meeting as permitted by section 490.704, a
21corporation shall hold a meeting of shareholders annually, at a
22time stated in or fixed in accordance with the bylaws, at which
23directors shall be elected.
   242.  Unless the board of directors determines to hold the
25meeting solely by means of remote communication in accordance
26with section 490.709, subsection 3, annual meetings may be held
27as follows:
   28a.  In or out of this state at the place stated in or fixed
29in accordance with the bylaws.
   30b.  If no place is stated in or fixed in accordance with the
31bylaws, at the corporation’s principal office.
   323.  The failure to hold an annual meeting at the time stated
33in or fixed in accordance with a corporation’s bylaws does not
34affect the validity of any corporate action.
35   Sec. 58.  Section 490.702, Code 2020, is amended by striking
-66-1the section and inserting in lieu thereof the following:
   2490.702  Special meeting.
   31.  Except as provided in subsection 5, a corporation shall
4hold a special meeting of shareholders upon the occurrence of
5any of the following:
   6a.  On call of its board of directors or the person or
7persons authorized to do so by the articles of incorporation
8or bylaws.
   9b.  If the shareholders holding at least ten percent of
10all the votes entitled to be cast on an issue proposed to be
11considered at the proposed special meeting sign, date, and
12deliver to the corporation one or more written demands for the
13meeting describing the purpose or purposes for which it is
14to be held, provided that the articles of incorporation may
15fix a lower percentage or a higher percentage not exceeding
16twenty-five percent of all the votes entitled to be cast on any
17issue proposed to be considered. Unless otherwise provided in
18the articles of incorporation, a written demand for a special
19meeting may be revoked by a writing to that effect received
20by the corporation before the receipt by the corporation of
21demands sufficient in number to require the holding of a
22special meeting.
   232.  If not otherwise fixed under section 490.703 or 490.707,
24the record date for determining shareholders entitled to
25demand a special meeting shall be the first date on which a
26signed shareholder demand is delivered to the corporation. No
27written demand for a special meeting shall be effective unless,
28within sixty days of the earliest date on which such a demand
29delivered to the corporation as required by this section was
30signed, written demands signed by shareholders holding at least
31the percentage of votes specified in or fixed in accordance
32with subsection 1, paragraph “b”, have been delivered to the
33corporation.
   343.  Unless the board of directors determines to hold the
35meeting solely by remote participation in accordance with
-67-1section 490.709, subsection 3, special meetings of shareholders
2may be held as follows:
   3a.  In or out of this state at the place stated in or fixed
4in accordance with the bylaws.
   5b.  If no place is so stated in or fixed in accordance with
6the bylaws, at the corporation’s principal office.
   74.  Only business within the purpose or purposes described in
8the meeting notice required by section 490.705, subsection 3,
9may be conducted at a special meeting of shareholders.
   105.  Notwithstanding subsections 1 through 4, a corporation
11that has a class of equity securities registered pursuant to
12section 12 of the federal Securities Exchange Act of 1934 is
13required to hold a special meeting only upon the occurrence of
14any of the following:
   15a.  On call of its board of directors or the person or
16persons authorized to call a special meeting by the articles of
17incorporation or bylaws.
   18b.  If the holders of at least fifty percent of all the votes
19entitled to be cast on any issue proposed to be considered at
20the proposed special meeting sign, date, and deliver to the
21corporation’s secretary one or more written demands for the
22meeting describing the purpose or purposes for which it is to
23be held.
24   Sec. 59.  Section 490.703, Code 2020, is amended by striking
25the section and inserting in lieu thereof the following:
   26490.703  Court-ordered meeting.
   271.  The district court of the county where a corporation’s
28principal office, or, if none in this state, its registered
29office, is located may summarily order a meeting to be held
30pursuant to any of the following:
   31a.  On application of any shareholder of the corporation if
32an annual meeting was not held or action by written consent in
33lieu of an annual meeting did not become effective within the
34earlier of six months after the end of the corporation’s fiscal
35year or fifteen months after its last annual meeting.
-68-   1b.  On application of one or more shareholders who signed a
2demand for a special meeting valid under section 490.702 if any
3of the following applies:
   4(1)  Notice of the special meeting was not given within
5thirty days after the first day on which the requisite number
6of such demands have been delivered to the corporation.
   7(2)  The special meeting was not held in accordance with the
8notice.
   92.  The court may fix the time and place of the meeting,
10determine the shares entitled to participate in the meeting,
11specify a record date or dates for determining shareholders
12entitled to notice of and to vote at the meeting, prescribe the
13form and content of the meeting notice, fix the quorum required
14for specific matters to be considered at the meeting, or direct
15that the shares represented at the meeting constitute a quorum
16for action on those matters, and enter other orders necessary
17to accomplish the purpose or purposes of the meeting.
   183.  For purposes of subsection 1, paragraph “a”,
19“shareholder” means a record shareholder, a beneficial
20shareholder, and an unrestricted voting trust beneficial owner.
21   Sec. 60.  Section 490.704, Code 2020, is amended by striking
22the section and inserting in lieu thereof the following:
   23490.704  Action without meeting.
   241.  Unless otherwise provided in the articles of
25incorporation, any action required or permitted by this chapter
26to be taken at a shareholders’ meeting may be taken without
27a meeting or vote, and, except as provided in subsection 5,
28without prior notice, if one or more written consents bearing
29the date of signature and describing the action taken are
30signed by the holders of outstanding shares having not less
31than ninety percent of the votes entitled to be cast at a
32meeting at which all shares entitled to vote on the action were
33present and voted, and are delivered to the corporation for
34inclusion in the minutes or filing with the corporate records.
   352.  Except in the case of a corporation that has a class
-69-1of equity securities registered pursuant to section 12 of
2the federal Securities Exchange Act of 1934, the articles of
3incorporation may provide that any action required or permitted
4by this chapter to be taken at a shareholders’ meeting may be
5taken without a meeting, and without prior notice, if consents
6in writing setting forth the action so taken are signed by
7the holders of outstanding shares having not less than the
8minimum number of votes that would be required to authorize
9or take the action at a meeting at which all shares entitled
10to vote on the action were present and voted. However, if a
11corporation’s articles of incorporation authorize shareholders
12to cumulate their votes when electing directors pursuant to
13section 490.728, directors shall not be elected by less than
14unanimous written consent. A written consent must bear the
15date of signature of the shareholder who signs the consent and
16be delivered to the corporation for filing by the corporation
17with the minutes or corporate records.
   183.  If not otherwise fixed under section 490.707 and if prior
19action by the board of directors is not required respecting
20the action to be taken without a meeting, the record date for
21determining the shareholders entitled to take action without
22a meeting shall be the first date on which a signed written
23consent is delivered to the corporation. If not otherwise
24fixed under section 490.707, and if prior action by the board
25of directors is required respecting the action to be taken
26without a meeting, the record date shall be the close of
27business on the day the resolution of the board of directors
28taking such prior action is adopted. No written consent
29shall be effective to take the corporate action referred to
30therein unless, within sixty days of the earliest date on
31which a consent delivered to the corporation as required by
32this section was signed, written consents signed by sufficient
33shareholders to take the action have been delivered to the
34corporation. A written consent may be revoked by a writing
35to that effect delivered to the corporation before unrevoked
-70-1written consents sufficient in number to take the corporate
2action have been delivered to the corporation.
   34.  A consent signed pursuant to the provisions of this
4section has the effect of a vote taken at a meeting and may
5be described as such in any document. Unless the articles
6of incorporation, bylaws, or a resolution of the board of
7directors provides for a reasonable delay to permit tabulation
8of written consents, the action taken by written consent
9shall be effective when written consents signed by sufficient
10shareholders to take the action have been delivered to the
11corporation.
   125.  a.  If this chapter requires that notice of a proposed
13action be given to nonvoting shareholders and the action is
14to be taken by written consent of the voting shareholders,
15the corporation shall give its nonvoting shareholders written
16notice of the action not more than ten days after any of the
17following:
   18(1)  Written consents sufficient to take the action have been
19delivered to the corporation.
   20(2)  Such later date that tabulation of consents is completed
21pursuant to an authorization under subsection 4.
   22b.  The notice must reasonably describe the action taken and
23contain or be accompanied by the same material that, under any
24provision of this chapter, would have been required to be sent
25to nonvoting shareholders in a notice of a meeting at which the
26proposed action would have been submitted to the shareholders
27for action.
   286.  a.  If action is taken by less than unanimous written
29consent of the voting shareholders, the corporation shall give
30its nonconsenting voting shareholders written notice of the
31action not more than ten days after any of the following:
   32(1)  Written consents sufficient to take the action have been
33delivered to the corporation.
   34(2)  Such later date that tabulation of consents is completed
35pursuant to an authorization under subsection 4.
-71-   1b.  The notice must reasonably describe the action taken
2and contain or be accompanied by the same material that, under
3any provision of this chapter, would have been required to be
4sent to voting shareholders in a notice of a meeting at which
5the action would have been submitted to the shareholders for
6action.
   77.  The notice requirements in subsections 5 and 6 shall not
8delay the effectiveness of actions taken by written consent,
9and a failure to comply with such notice requirements shall
10not invalidate actions taken by written consent, provided that
11this subsection shall not be deemed to limit judicial power
12to fashion any appropriate remedy in favor of a shareholder
13adversely affected by a failure to give such notice within the
14required time period.
15   Sec. 61.  Section 490.705, Code 2020, is amended by striking
16the section and inserting in lieu thereof the following:
   17490.705  Notice of meeting.
   181.  A corporation shall notify shareholders of the date,
19time, and place of each annual and special shareholders’
20meeting no fewer than ten nor more than sixty days before
21the meeting date. If the board of directors has authorized
22participation by means of remote communication pursuant to
23section 490.709 for holders of any class or series of shares,
24the notice to the holders of such class or series of shares
25must describe the means of remote communication to be used.
26The notice must include the record date for determining the
27shareholders entitled to vote at the meeting, if such date is
28different from the record date for determining shareholders
29entitled to notice of the meeting. Unless this chapter or the
30articles of incorporation require otherwise, the corporation
31is required to give notice only to shareholders entitled to
32vote at the meeting as of the record date for determining the
33shareholders entitled to notice of the meeting.
   342.  Unless this chapter or the articles of incorporation
35require otherwise, the notice of an annual meeting of
-72-1shareholders need not include a description of the purpose or
2purposes for which the meeting is called.
   33.  Notice of a special meeting of shareholders must include
4a description of the purpose or purposes for which the meeting
5is called.
   64.  If not otherwise fixed under section 490.703 or 490.707,
7the record date for determining shareholders entitled to notice
8of and to vote at an annual or special shareholders’ meeting is
9the day before the first notice is delivered to shareholders.
   105.  Unless the bylaws require otherwise, if an annual or
11special shareholders’ meeting is adjourned to a different
12date, time, or place, if any, notice need not be given of the
13new date, time, or place, if any, if the new date, time, or
14place, if any, is announced at the meeting before adjournment.
15However, if a new record date for the adjourned meeting is or
16must be fixed under section 490.707, notice of the adjourned
17meeting shall be given under this section to shareholders
18entitled to vote at such adjourned meeting as of the record
19date fixed for notice of such adjourned meeting.
20   Sec. 62.  Section 490.706, Code 2020, is amended by striking
21the section and inserting in lieu thereof the following:
   22490.706  Waiver of notice.
   231.  A shareholder may waive any notice required by this
24chapter, or the articles of incorporation or bylaws, before or
25after the date and time stated in the notice. The waiver must
26be in writing, be signed by the shareholder entitled to the
27notice, and be delivered to the corporation for filing by the
28corporation with the minutes or corporate records.
   292.  A shareholder’s attendance at a meeting does all of the
30following:
   31a.  Waives objection to lack of notice or defective notice
32of the meeting, unless the shareholder at the beginning of the
33meeting objects to holding the meeting or transacting business
34at the meeting.
   35b.  Waives objection to consideration of a particular matter
-73-1at the meeting that is not within the purpose or purposes
2described in the meeting notice, unless the shareholder objects
3to considering the matter when it is presented.
4   Sec. 63.  Section 490.707, Code 2020, is amended by striking
5the section and inserting in lieu thereof the following:
   6490.707  Record date for meeting.
   71.  The bylaws may fix or provide the manner of fixing the
8record date or dates for one or more voting groups to determine
9the shareholders entitled to notice of a shareholders’ meeting,
10to demand a special meeting, to vote, or to take any other
11action. If the bylaws do not fix or provide for fixing a record
12date, the board of directors may fix the record date.
   132.  A record date fixed under this section shall not be more
14than seventy days before the meeting or action requiring a
15determination of shareholders and shall not be retroactive.
   163.  A determination of shareholders entitled to notice of
17or to vote at a shareholders’ meeting is effective for any
18adjournment of the meeting unless the board of directors fixes
19a new record date or dates, which it shall do if the meeting is
20adjourned to a date more than one hundred twenty days after the
21date fixed for the original meeting.
   224.  If a court orders a meeting adjourned to a date more than
23one hundred twenty days after the date fixed for the original
24meeting, it may provide that the original record date or dates
25continue in effect or it may fix a new record date or dates.
   265.  The record date or dates for a shareholders’ meeting
27fixed by or in the manner provided in the bylaws or by the
28board of directors shall be the record date for determining
29shareholders entitled both to notice of and to vote at
30the shareholders’ meeting unless, in the case of a record
31date fixed by the board of directors and to the extent not
32prohibited by the bylaws, the board, at the time it fixes the
33record date for shareholders entitled to notice of the meeting,
34fixes a later record date on or before the date of the meeting
35to determine the shareholders entitled to vote at the meeting.
-74-1   Sec. 64.  Section 490.708, Code 2020, is amended by striking
2the section and inserting in lieu thereof the following:
   3490.708  Conduct of meeting.
   41.  At each meeting of shareholders, a chair shall preside.
5The chair shall be appointed as provided in the bylaws or, in
6the absence of such provision, by the board of directors.
   72.  The chair, unless the articles of incorporation or bylaws
8provide otherwise, shall determine the order of business and
9shall have the authority to establish rules for the conduct of
10the meeting.
   113.  Any rules adopted for, and the conduct of, the meeting
12shall be fair to shareholders.
   134.  The chair of the meeting shall announce at the meeting
14when the polls close for each matter voted upon. If no
15announcement is made, the polls shall be deemed to have closed
16upon the final adjournment of the meeting. After the polls
17close, no ballots, proxies, or votes nor any revocations or
18changes to such ballots, proxies, or votes may be accepted.
19   Sec. 65.  Section 490.709, Code 2020, is amended by striking
20the section and inserting in lieu thereof the following:
   21490.709  Remote participation in shareholders’ meetings.
   221.  Shareholders of any class or series of shares may
23participate in any meeting of shareholders by means of remote
24communication to the extent the board of directors authorizes
25such participation for such class or series. Participation as
26a shareholder by means of remote communication shall be subject
27to such guidelines and procedures as the board of directors
28adopts, and shall be in conformity with subsection 2.
   292.  Shareholders participating in a shareholders’ meeting
30by means of remote communication shall be deemed present and
31may vote at such a meeting if the corporation has implemented
32reasonable measures to do all of the following:
   33a.  Verify that each person participating remotely as a
34shareholder is a shareholder.
   35b.  Provide such shareholders a reasonable opportunity to
-75-1participate in the meeting and to vote on matters submitted to
2the shareholders, including an opportunity to communicate, and
3to read or hear the proceedings of the meeting, substantially
4concurrently with such proceedings.
   53.  Unless the bylaws require the meeting of shareholders to
6be held at a place, the board of directors may determine that
7any meeting of shareholders shall not be held at any place and
8shall instead be held solely by means of remote communication,
9but only if the corporation implements the measures specified
10in subsection 2.
11   Sec. 66.  Section 490.720, Code 2020, is amended by striking
12the section and inserting in lieu thereof the following:
   13490.720  Shareholders’ list for meeting.
   141.  After fixing a record date for a meeting, a corporation
15shall prepare an alphabetical list of the names of all its
16shareholders who are entitled to notice of a shareholders’
17meeting. If the board of directors fixes a different record
18date under section 490.707, subsection 5, to determine the
19shareholders entitled to vote at the meeting, a corporation
20also shall prepare an alphabetical list of the names of all
21its shareholders who are entitled to vote at the meeting. A
22list must be arranged by voting group and within each voting
23group by class or series of shares, and show the address of and
24number of shares held by each shareholder. Nothing contained
25in this subsection shall require the corporation to include
26on such list the electronic mail address or other electronic
27contact information of a shareholder.
   282.  a.  The shareholders’ list for notice shall be available
29for inspection by any shareholder, beginning two business
30days after notice of the meeting is given for which the
31list was prepared and continuing through the meeting. The
32shareholders’ list for notice shall be made available at any
33of the following:
   34(1)  The corporation’s principal office or at a place
35identified in the meeting notice in the city where the meeting
-76-1will be held.
   2(2)  A reasonably accessible electronic network, provided
3that the information required to gain access to such list is
4provided with the notice of the meeting. In the event that
5the corporation determines to make the list available on
6an electronic network, the corporation may take reasonable
7steps to ensure that such information is available only to
8shareholders of the corporation.
   9b.  A shareholders’ list for voting shall be similarly
10available for inspection promptly after the record date for
11voting. A shareholder, or the shareholder’s agent or attorney,
12is entitled on written demand to inspect and, subject to the
13requirements of section 490.1602, subsection 3, to copy a list,
14during regular business hours and at the shareholder’s expense,
15during the period it is available for inspection.
   163.  If the meeting is to be held at a place, the corporation
17shall make the list of shareholders entitled to vote available
18at the meeting, and any shareholder, or the shareholder’s
19agent or attorney, is entitled to inspect the list at any time
20during the meeting or any adjournment. If the meeting is to be
21held solely by means of remote communication, then such list
22shall also be open to such inspection during the meeting on a
23reasonably accessible electronic network, and the information
24required to access such list shall be provided with the notice
25of the meeting.
   264.  If the corporation refuses to allow a shareholder, or
27the shareholder’s agent or attorney, to inspect a shareholders’
28list before or at the meeting, or copy a list as permitted
29by subsection 2, the district court of the county where a
30corporation’s principal office or, if none in this state,
31its registered office, is located, on application of the
32shareholder, may summarily order the inspection or copying at
33the corporation’s expense and may postpone the meeting for
34which the list was prepared until the inspection or copying is
35complete.
-77-   15.  Refusal or failure to prepare or make available the
2shareholders’ list does not affect the validity of action taken
3at the meeting.
4   Sec. 67.  Section 490.721, Code 2020, is amended by striking
5the section and inserting in lieu thereof the following:
   6490.721  Voting entitlement of shares.
   71.  Except as provided in subsections 2 and 4 or unless the
8articles of incorporation provide otherwise, each outstanding
9share, regardless of class or series, is entitled to one vote
10on each matter voted on at a shareholders’ meeting. Only
11shares are entitled to vote.
   122.  Shares of a corporation are not entitled to vote if they
13are owned by or otherwise belong to the corporation directly,
14or indirectly through an entity of which a majority of the
15voting power is held directly or indirectly by the corporation
16or which is otherwise controlled by the corporation.
   173.  Shares held by the corporation in a fiduciary capacity
18for the benefit of any person are entitled to vote unless
19they are held for the benefit of, or otherwise belong to, the
20corporation directly, or indirectly through an entity of which
21a majority of the voting power is held directly or indirectly
22by the corporation or which is otherwise controlled by the
23corporation.
   244.  Redeemable shares are not entitled to vote after
25delivery of written notice of redemption is effective and a
26sum sufficient to redeem the shares has been deposited with a
27bank, trust company, or other financial institution under an
28irrevocable obligation to pay the holders the redemption price
29on surrender of the shares.
   305.  As used in this section, “voting power” means the current
31power to vote in the election of directors of a corporation or
32to elect, select, or appoint governors of another entity.
33   Sec. 68.  Section 490.722, Code 2020, is amended by striking
34the section and inserting in lieu thereof the following:
   35490.722  Proxies.
-78-   11.  A shareholder may vote the shareholder’s shares in person
2or by proxy.
   32.  A shareholder, or the shareholder’s agent or
4attorney-in-fact, may appoint a proxy to vote or otherwise
5act for the shareholder by signing an appointment form, or
6by an electronic transmission. An electronic transmission
7must contain or be accompanied by information from which the
8recipient can determine the date of the transmission and that
9the transmission was authorized by the sender or the sender’s
10agent or attorney-in-fact.
   113.  An appointment of a proxy is effective when a signed
12appointment form or an electronic transmission of the
13appointment is received by the inspector of election or
14the officer or agent of the corporation authorized to count
15votes. An appointment is valid for the term provided in the
16appointment form, and, if no term is provided, is valid for
17eleven months unless the appointment is irrevocable under
18subsection 4.
   194.  An appointment of a proxy is revocable unless the
20appointment form or electronic transmission states that it is
21irrevocable and the appointment is coupled with an interest.
22Appointments coupled with an interest include, but are not
23limited to, the appointment of any of the following:
   24a.  A pledgee.
   25b.  A person who purchased or agreed to purchase the shares.
   26c.  A creditor of the corporation who extended the
27corporation credit under terms requiring the appointment.
   28d.  An employee of the corporation whose employment contract
29requires the appointment.
   30e.  A party to a voting agreement created under section
31490.731.
   325.  The death or incapacity of the shareholder appointing
33a proxy does not affect the right of the corporation to
34accept the proxy’s authority unless notice of the death or
35incapacity is received by the secretary or other officer or
-79-1agent authorized to tabulate votes before the proxy exercises
2the proxy’s authority under the appointment.
   36.  An appointment made irrevocable under subsection 4
4is revoked when the interest with which it is coupled is
5extinguished.
   67.  Unless it otherwise provides, an appointment made
7irrevocable under subsection 4 continues in effect after
8a transfer of the shares and a transferee takes subject
9to the appointment, except that a transferee for value of
10shares subject to an irrevocable appointment may revoke the
11appointment if the transferee did not know of its existence
12when acquiring the shares and the existence of the irrevocable
13appointment was not noted conspicuously on the certificate
14representing the shares or on the information statement for
15shares without certificates.
   168.  Subject to section 490.724 and to any express limitation
17on the proxy’s authority stated in the appointment form or
18electronic transmission, a corporation is entitled to accept
19the proxy’s vote or other action as that of the shareholder
20making the appointment.
21   Sec. 69.  Section 490.723, Code 2020, is amended by striking
22the section and inserting in lieu thereof the following:
   23490.723  Shares held by intermediaries and nominees.
   241.  A corporation’s board of directors may establish a
25procedure under which a person on whose behalf shares are
26registered in the name of an intermediary or nominee may elect
27to be treated by the corporation as the record shareholder by
28filing with the corporation a beneficial ownership certificate.
29The terms, conditions, and limitations of this treatment shall
30be specified in the procedure. To the extent such person is
31treated under such procedure as having rights or privileges
32that the record shareholder otherwise would have, the record
33shareholder shall not have those rights or privileges.
   342.  The procedure must specify all of the following:
   35a.  The types of intermediaries or nominees to which it
-80-1applies.
   2b.  The rights or privileges that the corporation recognizes
3in a person with respect to whom a beneficial ownership
4certificate is filed.
   5c.  The manner in which the procedure is selected which must
6include that the beneficial ownership certificate be signed or
7assented to by or on behalf of the record shareholder and the
8person on whose behalf the shares are held.
   9d.  The information that must be provided when the procedure
10is selected.
   11e.  The period for which selection of the procedure is
12effective.
   13f.  Requirements for notice to the corporation with respect
14to the arrangement.
   15g.  The form and contents of the beneficial ownership
16certificate.
   173.  The procedure may specify any other aspects of the rights
18and duties created by the filing of a beneficial ownership
19certificate.
20   Sec. 70.  Section 490.724, Code 2020, is amended by striking
21the section and inserting in lieu thereof the following:
   22490.724  Acceptance of votes and other instruments.
   231.  If the name signed on a vote, ballot, consent, waiver,
24shareholder demand, or proxy appointment corresponds to the
25name of a shareholder, the corporation, if acting in good
26faith, is entitled to accept the vote, ballot, consent, waiver,
27shareholder demand, or proxy appointment and give it effect as
28the act of the shareholder.
   292.  If the name signed on a vote, ballot, consent, waiver,
30shareholder demand, or proxy appointment does not correspond to
31the name of its shareholder, the corporation, if acting in good
32faith, is nevertheless entitled to accept the vote, ballot,
33consent, waiver, shareholder demand, or proxy appointment and
34give it effect as the act of the shareholder if any of the
35following applies:
-81-   1a.  The shareholder is an entity and the name signed purports
2to be that of an officer or agent of the entity.
   3b.  The name signed purports to be that of an administrator,
4executor, guardian, or conservator representing the shareholder
5and, if the corporation requests, evidence of fiduciary status
6acceptable to the corporation has been presented with respect
7to the vote, ballot, consent, waiver, shareholder demand, or
8proxy appointment.
   9c.  The name signed purports to be that of a receiver
10or trustee in bankruptcy of the shareholder and, if the
11corporation requests, evidence of this status acceptable
12to the corporation has been presented with respect to the
13vote, ballot, consent, waiver, shareholder demand, or proxy
14appointment.
   15d.  The name signed purports to be that of a pledgee,
16beneficial owner, or attorney-in-fact of the shareholder
17and, if the corporation requests, evidence acceptable to
18the corporation of the signatory’s authority to sign for
19the shareholder has been presented with respect to the
20vote, ballot, consent, waiver, shareholder demand, or proxy
21appointment.
   22e.  Two or more persons are the shareholder as co-tenants or
23fiduciaries and the name signed purports to be the name of at
24least one of the co-owners and the person signing appears to be
25acting on behalf of all the co-owners.
   263.  The corporation is entitled to reject a vote, ballot,
27consent, waiver, shareholder demand, or proxy appointment if
28the person authorized to accept or reject such instrument,
29acting in good faith, has reasonable basis for doubt about
30the validity of the signature on it or about the signatory’s
31authority to sign for the shareholder.
   324.  Neither the corporation or any person authorized by it,
33nor an inspector of election appointed under section 490.729,
34that accepts or rejects a vote, ballot, consent, waiver,
35shareholder demand, or proxy appointment in good faith and
-82-1in accordance with the standards of this section or section
2490.722, subsection 2, is liable in damages to the shareholder
3for the consequences of the acceptance or rejection.
   45.  Corporate action based on the acceptance or rejection
5of a vote, ballot, consent, waiver, shareholder demand, or
6proxy appointment under this section is valid unless a court of
7competent jurisdiction determines otherwise.
   86.  If an inspector of election has been appointed under
9section 490.729, the inspector of election also has the
10authority to request information and make determinations
11under subsections 1, 2, and 3. Any determination made by the
12inspector of election under those subsections is controlling.
13   Sec. 71.  Section 490.725, Code 2020, is amended by striking
14the section and inserting in lieu thereof the following:
   15490.725  Quorum and voting requirements for voting groups.
   161.  Shares entitled to vote as a separate voting group
17may take action on a matter at a meeting only if a quorum of
18those shares exists with respect to that matter. Unless the
19articles of incorporation or bylaws provide otherwise, shares
20representing a majority of the votes entitled to be cast on
21the matter by the voting group constitutes a quorum of that
22voting group for action on that matter. Whenever this chapter
23requires a particular quorum for a specified action, the
24articles of incorporation shall not provide for a lower quorum.
   252.  Once a share is represented for any purpose at a meeting,
26it is deemed present for quorum purposes for the remainder of
27the meeting and for any adjournment of that meeting unless a
28new record date is or must be fixed for that adjourned meeting.
   293.  If a quorum exists, action on a matter, other than the
30election of directors, by a voting group is approved if the
31votes cast within the voting group favoring the action exceed
32the votes cast opposing the action, unless the articles of
33incorporation require a greater number of affirmative votes.
   344.  An amendment of the articles of incorporation adding,
35changing, or deleting a quorum or voting requirement for a
-83-1voting group greater than specified in subsection 1 or 3 is
2governed by section 490.727.
   35.  The election of directors is governed by section 490.728.
   46.  Whenever a provision of this chapter provides for voting
5of classes or series as separate voting groups, the rules
6provided in section 490.1004, subsection 3, for amendments of
7the articles of incorporation apply to that provision.
8   Sec. 72.  Section 490.726, Code 2020, is amended by striking
9the section and inserting in lieu thereof the following:
   10490.726  Action by single or multiple voting groups.
   111.  If the articles of incorporation or this chapter provide
12for voting by a single voting group on a matter, action on
13that matter is taken when voted upon by that voting group as
14provided in section 490.725.
   152.  If the articles of incorporation or this chapter provide
16for voting by two or more voting groups on a matter, action
17on that matter is taken only when voted upon by each of those
18voting groups counted separately as provided in section
19490.725. Action may be taken by different voting groups on a
20matter at different times.
21   Sec. 73.  Section 490.727, Code 2020, is amended by striking
22the section and inserting in lieu thereof the following:
   23490.727  Modifying quorum or voting requirements.
   24An amendment to the articles of incorporation or bylaws
25that adds, changes, or deletes a quorum or voting requirement
26shall meet the same quorum requirement and be adopted by the
27same vote and voting groups required to take action under the
28quorum and voting requirements then in effect or proposed to be
29adopted, whichever is greater.
30   Sec. 74.  Section 490.728, Code 2020, is amended by striking
31the section and inserting in lieu thereof the following:
   32490.728  Voting for directors — cumulative voting.
   331.  Unless otherwise provided in the articles of
34incorporation, directors are elected by a plurality of the
35votes cast by the shares entitled to vote in the election at a
-84-1meeting at which a quorum is present.
   22.  Shareholders do not have a right to cumulate their votes
3for directors unless the articles of incorporation so provide.
   43.  A statement included in the articles of incorporation
5that “[all] [a designated voting group of] shareholders are
6entitled to cumulate their votes for directors”, or words of
7similar import, means that the shareholders designated are
8entitled to multiply the number of votes they are entitled to
9cast by the number of directors for whom they are entitled to
10vote and cast the product for a single candidate or distribute
11the product among two or more candidates.
   124.  Shares otherwise entitled to vote cumulatively shall not
13be voted cumulatively at a particular meeting unless any of the
14following applies:
   15a.  The meeting notice or proxy statement accompanying
16the notice states conspicuously that cumulative voting is
17authorized.
   18b.  A shareholder who has the right to cumulate the
19shareholder’s votes gives notice to the corporation not less
20than forty-eight hours before the time set for the meeting of
21the shareholder’s intent to cumulate votes during the meeting,
22and if one shareholder gives this notice all other shareholders
23in the same voting group participating in the election are
24entitled to cumulate their votes without giving further notice.
25   Sec. 75.  Section 490.729, Code 2020, is amended by striking
26the section and inserting in lieu thereof the following:
   27490.729  Inspectors of election.
   281.  A corporation that has a class of equity securities
29registered pursuant to section 12 of the federal Securities
30Exchange Act of 1934 shall, and any other corporation
31may, appoint one or more inspectors to act at a meeting of
32shareholders in connection with determining voting results.
33Each inspector shall verify in writing that the inspector
34will faithfully execute the duties of inspector with strict
35impartiality and according to the best of the inspector’s
-85-1ability. An inspector may be an officer or employee of the
2corporation. The inspectors may appoint or retain other
3persons to assist the inspectors in the performance of the
4duties of inspector under subsection 2, and may rely on
5information provided by such persons and other persons,
6including those appointed to tabulate votes, unless the
7inspectors believe reliance is unwarranted.
   82.  The inspectors shall do all of the following:
   9a.  Ascertain the number of shares outstanding and the voting
10power of each.
   11b.  Determine the shares represented at a meeting.
   12c.  Determine the validity of proxy appointments and ballots.
   13d.  Count all votes.
   14e.  Make a written report of the results.
   153.  In performing their duties, the inspectors may examine
16any of the following:
   17a.  The proxy appointment forms and any other information
18provided in accordance with section 490.722, subsection 2.
   19b.  Any envelope or related writing submitted with those
20appointment forms.
   21c.  Any ballots.
   22d.  Any evidence or other information specified in section
23490.724.
   24e.  The relevant books and records of the corporation
25relating to its shareholders and their entitlement to vote,
26including any securities position list provided by a depository
27clearing agency.
   284.  a.  The inspectors also may consider other information
29that they believe is relevant and reliable for the purpose
30of performing any of the duties assigned to them pursuant to
31subsection 2, including for all of the following purposes:
   32(1)  Evaluating inconsistent, incomplete, or erroneous
33information.
   34(2)  Reconciling information submitted on behalf of banks,
35brokers, their nominees, or similar persons that indicates
-86-1more votes being cast than a proxy authorized by the record
2shareholder is entitled to cast.
   3b.  If the inspectors consider other information allowed by
4this subsection, they shall in their report under subsection
52 specify the information considered by them, including the
6purpose or purposes for which the information was considered,
7the person or persons from whom they obtained the information,
8when the information was obtained, the means by which the
9information was obtained, and the basis for the inspectors’
10belief that such information is relevant and reliable.
   115.  Determinations of law by the inspectors of election are
12subject to de novo review by a court in a proceeding under
13section 490.749 or other judicial proceeding.
14   Sec. 76.  Section 490.730, Code 2020, is amended by striking
15the section and inserting in lieu thereof the following:
   16490.730  Voting trusts.
   171.  One or more shareholders may create a voting trust,
18conferring on a trustee the right to vote or otherwise act for
19them, by signing an agreement setting out the provisions of the
20trust, which may include anything consistent with its purpose,
21and transferring their shares to the trustee. When a voting
22trust agreement is signed, the trustee shall prepare a list of
23the names and addresses of all voting trust beneficial owners,
24together with the number and class of shares each transferred
25to the trust, and deliver copies of the list and agreement to
26the corporation at its principal office.
   272.  A voting trust becomes effective on the date the first
28shares subject to the trust are registered in the trustee’s
29name.
   303.  Limits, if any, on the duration of a voting trust shall
31be as set forth in the voting trust. A voting trust that became
32effective between December 31, 1989, and June 30, 2014, both
33dates inclusive, is governed by the provisions of this section
34concerning duration then in effect, unless the voting trust
35is amended to provide otherwise by unanimous agreement of the
-87-1parties to the voting trust.
2   Sec. 77.  Section 490.731, Code 2020, is amended by striking
3the section and inserting in lieu thereof the following:
   4490.731  Voting agreement.
   51.  Two or more shareholders may provide for the manner in
6which they will vote their shares by signing an agreement for
7that purpose. A voting agreement created under this section is
8not subject to the provisions of section 490.730.
   92.  A voting agreement created under this section is
10specifically enforceable.
11   Sec. 78.  Section 490.732, Code 2020, is amended by striking
12the section and inserting in lieu thereof the following:
   13490.732  Shareholder agreement.
   141.  An agreement among the shareholders of a corporation that
15complies with this section is effective among the shareholders
16and the corporation even though it is inconsistent with one or
17more other provisions of this chapter in that it does any of
18the following:
   19a.  Eliminates the board of directors or restricts the
20discretion or powers of the board of directors.
   21b.  Governs the authorization or making of distributions,
22regardless of whether they are in proportion to ownership of
23shares, subject to the limitations in section 490.640.
   24c.  Establishes who shall be directors or officers of the
25corporation, or their terms of office or manner of selection
26or removal.
   27d.  Governs, in general or in regard to specific matters,
28the exercise or division of voting power by or between
29the shareholders and directors or by or among any of them,
30including use of weighted voting rights or director proxies.
   31e.  Establishes the terms and conditions of any agreement for
32the transfer or use of property or the provision of services
33between the corporation and any shareholder, director, officer,
34or employee of the corporation, or among any of them.
   35f.  Transfers to one or more shareholders or other persons
-88-1all or part of the authority to exercise the corporate powers
2or to manage the business and affairs of the corporation,
3including the resolution of any issue about which there exists
4a deadlock among directors or shareholders.
   5g.  Requires dissolution of the corporation at the request
6of one or more of the shareholders or upon the occurrence of a
7specified event or contingency.
   8h.  Otherwise governs the exercise of the corporate powers or
9the management of the business and affairs of the corporation
10or the relationship among the shareholders, the directors, and
11the corporation, or among any of them, and is not contrary to
12public policy.
   132.  An agreement authorized by this section shall satisfy all
14of the following requirements:
   15a.  Be as set forth in any of the following:
   16(1)  The articles of incorporation or bylaws and approved by
17all persons who are shareholders at the time of the agreement.
   18(2)  A written agreement that is signed by all persons who
19are shareholders at the time of the agreement and is made known
20to the corporation.
   21b.  Be subject to amendment only by all persons who are
22shareholders at the time of the amendment, unless the agreement
23provides otherwise.
   243.  The existence of an agreement authorized by this section
25shall be noted conspicuously on the front or back of each
26certificate for outstanding shares or on the information
27statement required by section 490.626, subsection 2. If at the
28time of the agreement the corporation has shares outstanding
29represented by certificates, the corporation shall recall the
30outstanding certificates and issue substitute certificates that
31comply with this subsection. The failure to note the existence
32of the agreement on the certificate or information statement
33shall not affect the validity of the agreement or any action
34taken pursuant to it. Any purchaser of shares who, at the time
35of purchase, did not have knowledge of the existence of the
-89-1agreement shall be entitled to rescission of the purchase. A
2purchaser shall be deemed to have knowledge of the existence
3of the agreement if its existence is noted on the certificate
4or information statement for the shares in compliance with
5this subsection and, if the shares are not represented by a
6certificate, the information statement is delivered to the
7purchaser at or before the time of purchase of the shares. An
8action to enforce the right of rescission authorized by this
9subsection shall be commenced within the earlier of ninety days
10after discovery of the existence of the agreement or two years
11after the time of purchase of the shares.
   124.  If the agreement ceases to be effective for any reason,
13the board of directors may, if the agreement is contained or
14referred to in the corporation’s articles of incorporation or
15bylaws, adopt an amendment to the articles of incorporation or
16bylaws, without shareholder action, to delete the agreement and
17any references to it.
   185.  An agreement authorized by this section that limits the
19discretion or powers of the board of directors shall relieve
20the directors of, and impose upon the person or persons in
21whom such discretion or powers are vested, liability for acts
22or omissions imposed by law on directors to the extent that
23the discretion or powers of the directors are limited by the
24agreement.
   256.  The existence or performance of an agreement authorized
26by this section shall not be a ground for imposing personal
27liability on any shareholder for the acts or debts of the
28corporation even if the agreement or its performance treats the
29corporation as if it were a partnership or results in failure
30to observe the corporate formalities otherwise applicable to
31the matters governed by the agreement.
   327.  Incorporators or subscribers for shares may act as
33shareholders with respect to an agreement authorized by this
34section if no shares have been issued when the agreement is
35made.
-90-   18.  Limits, if any, on the duration of an agreement
2authorized by this section must be set forth in the agreement.
3An agreement that became effective between January 1, 2003,
4and June 30, 2014, both dates inclusive, unless the agreement
5provided otherwise, remains governed by the provisions of this
6section concerning duration then in effect.
7   Sec. 79.  Section 490.740, Code 2020, is amended by striking
8the section and inserting in lieu thereof the following:
   9490.740  Part definitions.
   10As used in this part:
   111.  “Derivative proceeding” means a civil suit in the right
12of a domestic corporation or, to the extent provided in section
13490.747, in the right of a foreign corporation.
   142.  “Shareholder” means a record shareholder, a beneficial
15shareholder, and an unrestricted voting trust beneficial owner.
16   Sec. 80.  Section 490.743, Code 2020, is amended by striking
17the section and inserting in lieu thereof the following:
   18490.743  Stay of proceedings.
   19If the corporation commences an inquiry into the allegations
20made in the demand or complaint, the court may stay any
21derivative proceeding for such period as the court deems
22appropriate.
23   Sec. 81.  Section 490.744, Code 2020, is amended by striking
24the section and inserting in lieu thereof the following:
   25490.744  Dismissal.
   261.  A derivative proceeding shall be dismissed by the court
27on motion by the corporation if one of the groups specified
28in subsection 2 or 5 has determined in good faith, after
29conducting a reasonable inquiry upon which its conclusions are
30based, that the maintenance of the derivative proceeding is
31not in the best interests of the corporation. A corporation
32moving to dismiss on this basis shall submit in support of the
33motion a short and concise statement of the reasons for its
34determination.
   352.  Unless a panel is appointed pursuant to subsection 5,
-91-1the determination in subsection 1 shall be made by any of the
2following:
   3a.  A majority vote of qualified directors present at a
4meeting of the board of directors if the qualified directors
5constitute a quorum.
   6b.  A majority vote of a committee consisting of two or more
7qualified directors appointed by majority vote of qualified
8directors present at a meeting of the board of directors,
9regardless of whether such qualified directors constitute a
10quorum.
   113.  a.  If a derivative proceeding is commenced after
12a determination has been made rejecting a demand by a
13shareholder, the complaint shall allege with particularity
14facts establishing any of the following:
   15(1)  That a majority of the board of directors did not
16consist of qualified directors at the time the determination
17was made.
   18(2)  That the requirements of subsection 1 have not been met.
   19b.  All discovery and other proceedings shall be stayed
20during the pendency of any motion to dismiss unless the
21court finds upon the motion of any party that particularized
22discovery is necessary to preserve evidence or prevent undue
23prejudice to that party.
   244.  If a majority of the board of directors consisted
25of qualified directors at the time the determination was
26made, the plaintiff shall have the burden of proving that
27the requirements of subsection 1 have not been met; if not,
28the corporation shall have the burden of proving that the
29requirements of subsection 1 have been met.
   305.  Upon motion by the corporation, the court may appoint
31a panel of one or more individuals to make a determination
32whether the maintenance of the derivative proceeding is in the
33best interests of the corporation. In such case, the plaintiff
34shall have the burden of proving that the requirements of
35subsection 1 have not been met.
-92-1   Sec. 82.  Section 490.745, Code 2020, is amended by striking
2the section and inserting in lieu thereof the following:
   3490.745  Discontinuance or settlement.
   4A derivative proceeding shall not be discontinued or settled
5without the court’s approval. If the court determines that a
6proposed discontinuance or settlement will substantially affect
7the interests of the corporation’s shareholders or a class or
8series of shareholders, the court shall direct that notice be
9given to the shareholders affected.
10   Sec. 83.  Section 490.746, Code 2020, is amended by striking
11the section and inserting in lieu thereof the following:
   12490.746  Payment of expenses.
   13On termination of the derivative proceeding, the court may
14do any of the following:
   151.  Order the corporation to pay the plaintiff’s expenses
16incurred in the proceeding if it finds that the proceeding has
17resulted in a substantial benefit to the corporation.
   182.  Order the plaintiff to pay any defendant’s expenses
19incurred in defending the proceeding if it finds that the
20proceeding was commenced or maintained without reasonable cause
21or for an improper purpose.
   223.  Order a party to pay an opposing party’s expenses
23incurred because of the filing of a pleading, motion, or other
24paper, if it finds that any of the following apply:
   25a.  The pleading, motion, or other paper was not well
26grounded in fact, after reasonable inquiry, or warranted by
27existing law or a good faith argument for the extension,
28modification, or reversal of existing law.
   29b.  The pleading, motion, or other paper was interposed for
30an improper purpose, such as to harass or cause unnecessary
31delay or needless increase in the cost of litigation.
32   Sec. 84.  Section 490.748, Code 2020, is amended by striking
33the section and inserting in lieu thereof the following:
   34490.748  Shareholder action to appoint custodian or receiver.
   351.  The district court of the county where a corporation’s
-93-1principal office or, if none in this state, its registered
2office, is located may appoint one or more persons to be
3custodians, or, if the corporation is insolvent, to be
4receivers, of and for a corporation in a proceeding by a
5shareholder where it is established that any of the following
6applies:
   7a.  The directors are deadlocked in the management of
8the corporate affairs, the shareholders are unable to break
9the deadlock, and irreparable injury to the corporation is
10threatened or being suffered.
   11b.  The directors or those in control of the corporation are
12acting fraudulently and irreparable injury to the corporation
13is threatened or being suffered.
   142.  a.  The district court may issue injunctions, appoint a
15temporary custodian or temporary receiver with all the powers
16and duties the district court directs, take other action to
17preserve the corporate assets wherever located, and carry on
18the business of the corporation until a full hearing is held.
   19b.  The district court shall hold a full hearing, after
20notifying all parties to the proceeding and any interested
21persons designated by the district court, before appointing a
22custodian or receiver.
   23c.  The district court has jurisdiction over the corporation
24and all of its property, wherever located.
   253.  The district court may appoint an individual or domestic
26or foreign corporation, registered to do business in this
27state, as a custodian or receiver and may require the custodian
28or receiver to post bond, with or without sureties, in an
29amount the district court directs.
   304.  The district court shall describe the powers and duties
31of the custodian or receiver in its appointing order, which may
32be amended from time to time. Among other powers, all of the
33following apply:
   34a.  A custodian may exercise all of the powers of the
35corporation, through or in place of its board of directors, to
-94-1the extent necessary to manage the business and affairs of the
2corporation.
   3b.  A receiver may do any of the following:
   4(1)  Dispose of all or any part of the assets of the
5corporation wherever located, at a public or private sale, if
6authorized by the district court.
   7(2)  Sue and defend in the receiver’s own name as receiver in
8all courts of this state.
   95.  The district court during a custodianship may
10redesignate the custodian a receiver, and during a receivership
11may redesignate the receiver a custodian, if doing so is in the
12best interests of the corporation.
   136.  The district court from time to time during the
14custodianship or receivership may order compensation paid and
15expense disbursements or reimbursements made to the custodian
16or receiver from the assets of the corporation or proceeds from
17the sale of its assets.
   187.  As used in this section, “shareholder” means a record
19shareholder, a beneficial shareholder, and an unrestricted
20voting trust beneficial owner.
21   Sec. 85.  NEW SECTION.  490.749  Judicial determination of
22corporate offices and review of elections and shareholder votes.
   231.  Upon application of or in a proceeding commenced by a
24person specified in subsection 2, the district court of the
25county where the corporation’s principal office or, if none in
26this state, its registered office, is located may determine all
27of the following:
   28a.  The result or validity of the election, appointment,
29removal, or resignation of a director or officer of the
30corporation.
   31b.  The right of an individual to hold the office of director
32or officer of the corporation.
   33c.  The result or validity of any vote by the shareholders
34of the corporation.
   35d.  The right of a director to membership on a committee of
-95-1the board of directors.
   2e.  The right of a person to nominate or an individual to
3be nominated as a candidate for election or appointment as
4a director of the corporation, and any right under a bylaw
5adopted pursuant to section 490.206, subsection 3, or any
6comparable right under any provision of the articles of
7incorporation, contract, or applicable law.
   82.  An application or proceeding pursuant to subsection 1 may
9be filed or commenced by any of the following persons:
   10a.  The corporation.
   11b.  Any record shareholder, beneficial shareholder, or
12unrestricted voting trust beneficial owner of the corporation.
   13c.  A director of the corporation, an individual claiming
14the office of director, or a director whose membership on a
15committee of the board of directors is contested, in each case
16who is seeking a determination of a right to such office or
17membership.
   18d.  An officer of the corporation or an individual claiming
19to be an officer of the corporation, in each case who is
20seeking a determination of a right to such office.
   21e.  A person claiming a right covered by subsection 1,
22paragraph “e”, and who is seeking a determination of such right.
   233.  In connection with any application or proceeding under
24subsection 1, the following shall be named as defendants,
25unless such person made the application or commenced the
26proceeding:
   27a.  The corporation.
   28b.  Any individual whose right to office or membership on a
29committee of the board of directors is contested.
   30c.  Any individual claiming the office or membership at
31issue.
   32d.  Any person claiming a right covered by subsection 1,
33paragraph “e”, that is at issue.
   344.  In connection with any application or proceeding under
35subsection 1, service of process may be made upon each of the
-96-1persons specified in subsection 3, by any of the following:
   2a.  Service of process on the corporation addressed to such
3person in any manner provided by statute of this state or by
4rule of the applicable court for service on the corporation.
   5b.  Service of process on the person in any manner provided
6by statute of this state or by rule of the applicable court.
   75.  When service of process is made upon a person other than
8the corporation by service upon the corporation pursuant to
9subsection 4, paragraph “a”, the plaintiff and the corporation
10or its registered agent shall promptly provide written notice
11of such service, together with copies of all process and the
12application or complaint, to the person at the person’s last
13known residence or business address, or as permitted by statute
14of this state or by rule of the applicable court.
   156.  In connection with any application or proceeding under
16subsection 1, the court shall dispose of the application or
17proceeding on an expedited basis and also may do any of the
18following:
   19a.  Order such additional or further notice as the court
20deems proper under the circumstances.
   21b.  Order that additional persons be joined as parties to
22the proceeding if the court determines that such joinder is
23necessary for a just adjudication of matters before the court.
   24c.  Order an election or meeting be held in accordance with
25the provisions of section 490.703, subsection 2, or otherwise.
   26d.  Appoint a master to conduct an election or meeting.
   27e.  Enter temporary, preliminary, or permanent injunctive
28relief.
   29f.  Resolve solely for the purpose of this proceeding any
30legal or factual issues necessary for the resolution of any of
31the matters specified in subsection 1, including the right and
32power of persons claiming to own shares to vote at any meeting
33of the shareholders.
   34g.  Order such other relief as the court determines is
35equitable, just, and proper.
-97-   17.  It is not necessary to make shareholders a party to
2a proceeding or application pursuant to this section unless
3the shareholder is a required defendant under subsection
43, paragraph “d”, relief is sought against the shareholder
5individually, or the court orders joinder pursuant to
6subsection 6, paragraph “b”.
   78.  Nothing in this section limits, restricts, or abolishes
8the subject matter jurisdiction or powers of the court
9as existed before the enactment of this section, and an
10application or proceeding pursuant to this section is not the
11exclusive remedy or proceeding available with respect to the
12matters specified in subsection 1.
13   Sec. 86.  NEW SECTION.  490.800  Special subchapter
14definition.
   151.  As used in this subchapter, “public corporation” means a
16corporation that has a class of voting stock that is listed on
17a national securities exchange or held of record by more than
18two thousand shareholders.
   192.  This section is repealed on January 1, 2022.
20   Sec. 87.  Section 490.801, Code 2020, is amended by striking
21the section and inserting in lieu thereof the following:
   22490.801  Requirement for and functions of board of directors.
   231.  Except as may be provided in an agreement authorized
24under section 490.732, each corporation shall have a board of
25directors.
   262.  Except as may be provided in an agreement authorized
27under section 490.732, and subject to any limitation in
28the articles of incorporation permitted by section 490.202,
29subsection 2, all corporate powers shall be exercised by or
30under the authority of the board of directors, and the business
31and affairs of the corporation shall be managed by or under
32the direction, and subject to the oversight, of the board of
33directors.
34   Sec. 88.  Section 490.802, Code 2020, is amended by striking
35the section and inserting in lieu thereof the following:
-98-   1490.802  Qualifications of directors.
   21.  The articles of incorporation or bylaws may prescribe
3qualifications for directors or for nominees for directors.
4Qualifications must be reasonable as applied to the corporation
5and be lawful.
   62.  A requirement that is based on a past, prospective,
7or current action, or expression of opinion, by a nominee
8or director that could limit the ability of a nominee or
9director to discharge his or her duties as a director is not a
10permissible qualification under this section. Notwithstanding
11the foregoing, qualifications may include not being or having
12been subject to specified criminal, civil, or regulatory
13sanctions or not having been removed as a director by judicial
14action or for cause.
   153.  A director need not be a resident of this state or a
16shareholder unless the articles of incorporation or bylaws so
17prescribe.
   184.  A qualification for nomination for director prescribed
19before a person’s nomination shall apply to such person at
20the time of nomination. A qualification for nomination for
21director prescribed after a person’s nomination shall not apply
22to such person with respect to such nomination.
   235.  A qualification for director prescribed before a
24director has been elected or appointed may apply only at the
25time an individual becomes a director or may apply during a
26director’s term. A qualification prescribed after a director
27has been elected or appointed shall not apply to that director
28before the end of that director’s term.
29   Sec. 89.  Section 490.803, Code 2020, is amended by striking
30the section and inserting in lieu thereof the following:
   31490.803  Number and election of directors.
   321.  A board of directors shall consist of one or more
33individuals, with the number specified in or fixed in
34accordance with the articles of incorporation or bylaws.
      352.   a.  The number of directors may be increased or decreased
-99-1from time to time by amendment to, or in the manner provided
2in, the articles of incorporation or bylaws.
   3b.  (1)  Notwithstanding paragraph “a”, the number of
4directors of a public corporation subject to section 490.806A,
5subsection 1, or section 490.806B, shall be increased or
6decreased only by the affirmative vote of a majority of its
7board of directors.
   8(2)  This paragraph “b” is repealed on January 1, 2022.
      93.   a.  Directors are elected at the first annual shareholders’
10meeting and at each annual shareholders’ meeting thereafter
11unless elected by written consent in lieu of an annual meeting
12as permitted by section 490.704 or unless their terms are
13staggered under section 490.806.
   14b.  (1)  Notwithstanding paragraph “a”, for a public
15corporation subject to section 490.806A, subsection 1, or
16section 490.806B, a director’s term shall be staggered as
17provided in section 490.806A, subsection 1, or may be staggered
18as provided in section 490.806B.
   19(2)  This paragraph “b” is repealed on January 1, 2022.
20   Sec. 90.  Section 490.804, Code 2020, is amended by striking
21the section and inserting in lieu thereof the following:
   22490.804  Election of directors by certain classes of series
23of shares.
   24If the articles of incorporation or action by the board of
25directors pursuant to section 490.602 authorize dividing the
26shares into classes or series, the articles of incorporation
27may also authorize the election of all or a specified number
28of directors by the holders of one or more authorized classes
29or series of shares. A class or series, or multiple classes
30or series, of shares entitled to elect one or more directors
31is a separate voting group for purposes of the election of
32directors.
33   Sec. 91.  Section 490.805, Code 2020, is amended by striking
34the section and inserting in lieu thereof the following:
   35490.805  Terms of directors generally.
-100-   11.  The terms of the initial directors of a corporation
2expire at the first shareholders’ meeting at which directors
3are elected.
   42.  a.  The terms of all other directors expire at the
5next, or if their terms are staggered in accordance with
6section 490.806, at the applicable second or third, annual
7shareholders’ meeting following their election.
   8b.  Paragraph “a” does not apply in any of the following
9circumstances:
   10(1)  To the extent provided in section 490.1022 if a bylaw
11electing to be governed by that section is in effect.
   12(2)  A shorter term is specified in the articles of
13incorporation in the event of a director nominee failing to
14receive a specified vote for election.
   15c.  (1)  Notwithstanding paragraph “a”, for a public
16corporation subject to section 490.806A, subsection 1, or
17section 490.806B, the terms of directors shall be staggered as
18provided in section 490.806A, subsection 1, or may be staggered
19as provided in section 490.806B.
   20(2)  This paragraph “c” is repealed on January 1, 2022.
   213.  A decrease in the number of directors does not shorten
22an incumbent director’s term.
      234.   a.  The term of a director elected to fill a vacancy
24expires at the next shareholders’ meeting at which directors
25are elected.
   26b.  (1)  Notwithstanding paragraph “a”, for a public
27corporation subject to section 490.806A, subsection 1, or
28section 490.806B, the term of a director elected to fill a
29vacancy expires as provided in section 490.806A, subsection 1,
30or section 490.806B.
   31(2)  This paragraph “b” is repealed on January 1, 2022.
   325.  Except to the extent otherwise provided in the articles
33of incorporation or under section 490.1022, if a bylaw electing
34to be governed by that section is in effect, despite the
35expiration of a director’s term, the director continues to
-101-1serve until the director’s successor is elected and qualifies
2or there is a decrease in the number of directors.
3   Sec. 92.  Section 490.806, Code 2020, is amended by striking
4the section and inserting in lieu thereof the following:
   5490.806  Staggered terms for directors.
   61. The articles of incorporation may provide for staggering
7the terms of directors by dividing the total number of
8directors into two or three groups, with each group containing
9one-half or one-third of the total, as near as may be
10practicable. In that event, the terms of directors in the
11first group expire at the first annual shareholders’ meeting
12after their election, the terms of the second group expire at
13the second annual shareholders’ meeting after their election,
14and the terms of the third group, if any, expire at the third
15annual shareholders’ meeting after their election. At each
16annual shareholders’ meeting held thereafter, directors shall
17be elected for a term of two years or three years, as the case
18may be, to succeed those whose terms expire.
   192.  a.  Subsection 1 does not apply to a public corporation
20that is subject to section 490.806A, subsection 1, but may
21apply to a public corporation that is subject to section
22490.806B.
   23b.  This subsection is repealed on January 1, 2022.
24   Sec. 93.  Section 490.807, Code 2020, is amended by striking
25the section and inserting in lieu thereof the following:
   26490.807  Resignation of directors.
   271.  A director may resign at any time by delivering a written
28notice of resignation to the board of directors or its chair,
29or to the secretary.
   302.  A resignation is effective as provided in section
31490.141, subsection 9, unless the resignation provides for a
32delayed effectiveness, including effectiveness determined upon
33a future event or events. A resignation that is conditioned
34upon failing to receive a specified vote for election as a
35director may provide that it is irrevocable.
-102-1   Sec. 94.  Section 490.808, Code 2020, is amended by striking
2the section and inserting in lieu thereof the following:
   3490.808  Removal of directors by shareholders.
   41.  The shareholders may remove one or more directors with or
5without cause unless the articles of incorporation provide that
6directors may be removed only for cause.
   72.  If a director is elected by a voting group of
8shareholders, only the shareholders of that voting group may
9participate in the vote to remove that director.
   103.  A director may be removed if the number of votes cast
11to remove exceeds the number of votes cast not to remove the
12director, except to the extent the articles of incorporation
13or bylaws require a greater number. However, if cumulative
14voting is authorized, a director shall not be removed if, in
15the case of a meeting, the number of votes sufficient to elect
16the director under cumulative voting is voted against removal
17and, if action is taken by less than unanimous written consent,
18voting shareholders entitled to the number of votes sufficient
19to elect the director under cumulative voting do not consent
20to the removal.
   214.  A director may be removed by the shareholders only at a
22meeting called for the purpose of removing the director, and
23the meeting notice must state that removal of the director is a
24purpose of the meeting.
25   Sec. 95.  Section 490.809, Code 2020, is amended by striking
26the section and inserting in lieu thereof the following:
   27490.809  Removal of directors by judicial proceeding.
   281.  The district court of the county where a corporation’s
29principal office or, if none in this state, its registered
30office, is located may remove a director from office or
31may order other relief, including barring the director
32from reelection for a period prescribed by the court, in a
33proceeding commenced by or in the right of the corporation if
34the court finds that all of the following apply:
   35a.  The director engaged in fraudulent conduct with respect
-103-1to the corporation or its shareholders, grossly abused the
2position of director, or intentionally inflicted harm on the
3corporation.
   4b.  Considering the director’s course of conduct and the
5inadequacy of other available remedies, removal or such other
6relief would be in the best interest of the corporation.
   72.  A shareholder proceeding on behalf of the corporation
8under subsection 1 shall comply with all of the requirements of
9subchapter VII, part D, except section 490.741, subsection 1.
10   Sec. 96.  Section 490.810, Code 2020, is amended by striking
11the section and inserting in lieu thereof the following:
   12490.810  Vacancy on board of directors.
   131.  Unless the articles of incorporation provide otherwise,
14if a vacancy occurs on a board of directors, including a
15vacancy resulting from an increase in the number of directors,
16the vacancy may be filled in any of the following manners:
   17a.  The shareholders may fill the vacancy.
   18b.  The board of directors may fill the vacancy.
   19c.  If the directors remaining in office are less than a
20quorum, they may fill the vacancy by the affirmative vote of a
21majority of all the directors remaining in office.
   221A.  a.  For a public corporation subject to section
23490.806A, subsection 1, or section 490.806B, a vacancy on the
24board of directors, including but not limited to a vacancy
25resulting from an increase in the number of directors, shall
26be filled solely by the affirmative vote of a majority of the
27remaining directors, even though less than a quorum of the
28board.
   29b.  This subsection is repealed on January 1, 2022.
   302.  If the vacant office was held by a director elected by
31a voting group of shareholders, only the holders of shares of
32that voting group are entitled to vote to fill the vacancy
33if it is filled by the shareholders, and only the remaining
34directors elected by that voting group, even if less than a
35quorum, are entitled to fill the vacancy if it is filled by the
-104-1directors.
   23.  A vacancy that will occur at a specific later date, by
3reason of a resignation effective at a later date under section
4490.807, subsection 2, or otherwise, may be filled before the
5vacancy occurs but the new director shall not take office until
6the vacancy occurs.
7   Sec. 97.  Section 490.820, Code 2020, is amended by striking
8the section and inserting in lieu thereof the following:
   9490.820  Meetings.
   101.  The board of directors may hold regular or special
11meetings in or out of this state.
   122.  Unless restricted by the articles of incorporation
13or bylaws, any director may participate in any meeting
14of the board of directors through the use of any means of
15communication by which all directors participating may
16simultaneously hear each other during the meeting. A director
17participating in a meeting by this means is deemed to be
18present in person at the meeting.
19   Sec. 98.  Section 490.821, Code 2020, is amended by striking
20the section and inserting in lieu thereof the following:
   21490.821  Action without meeting.
   221.  Except to the extent that the articles of incorporation
23or bylaws require that action by the board of directors be
24taken at a meeting, action required or permitted by this
25chapter to be taken by the board of directors may be taken
26without a meeting if each director signs a consent describing
27the action to be taken and delivers it to the corporation.
   282.  Action taken under this section is the act of the board
29of directors when one or more consents signed by all the
30directors are delivered to the corporation. The consent may
31specify the time at which the action taken is to be effective.
32A director’s consent may be withdrawn by a revocation signed by
33the director and delivered to the corporation before delivery
34to the corporation of unrevoked written consents signed by all
35the directors.
-105-   13.  A consent signed under this section has the effect of
2action taken at a meeting of the board of directors and may be
3described as such in any document.
4   Sec. 99.  Section 490.822, Code 2020, is amended by striking
5the section and inserting in lieu thereof the following:
   6490.822  Notice of meeting.
   71.  Unless the articles of incorporation or bylaws provide
8otherwise, regular meetings of the board of directors may be
9held without notice of the date, time, place, or purpose of the
10meeting.
   112.  Unless the articles of incorporation or bylaws provide
12for a longer or shorter period, special meetings of the board
13of directors shall be preceded by at least two days’ notice of
14the date, time, and place of the meeting. The notice need not
15describe the purpose of the special meeting unless required by
16the articles of incorporation or bylaws.
17   Sec. 100.  Section 490.823, Code 2020, is amended by striking
18the section and inserting in lieu thereof the following:
   19490.823  Waiver of notice.
   201.  A director may waive any notice required by this chapter,
21the articles of incorporation, or the bylaws before or after
22the date and time stated in the notice. Except as provided
23by subsection 2, the waiver must be in writing, signed by
24the director entitled to the notice, and delivered to the
25corporation for filing by the corporation with the minutes or
26corporate records.
   272.  A director’s attendance at or participation in a meeting
28waives any required notice to the director of the meeting
29unless all of the following apply:
   30a.  The director at the beginning of the meeting, or promptly
31upon arrival, objects to holding the meeting or transacting
32business at the meeting.
   33b.  The director does not, after objecting, vote for or
34assent to action taken at the meeting.
35   Sec. 101.  Section 490.824, Code 2020, is amended by striking
-106-1the section and inserting in lieu thereof the following:
   2490.824  Quorum and voting.
   31.  Unless the articles of incorporation or bylaws provide
4for a greater or lesser number, or unless otherwise expressly
5provided in this chapter, a quorum of a board of directors
6consists of a majority of the number of directors specified in
7or fixed in accordance with the articles of incorporation or
8bylaws.
   92.  The quorum of the board of directors specified in
10or fixed in accordance with the articles of incorporation
11or bylaws shall not consist of less than one-third of the
12specified or fixed number of directors.
   133.  If a quorum is present when a vote is taken, the
14affirmative vote of a majority of directors present is the act
15of the board of directors unless the articles of incorporation
16or bylaws require the vote of a greater number of directors or
17unless otherwise expressly provided in this chapter.
   184.  a.  A director who is present at a meeting of the board
19of directors or a committee when corporate action is taken is
20deemed to have assented to the action taken unless one or more
21of the following occurs:
   22(1)  The director objects at the beginning of the meeting, or
23promptly upon arrival, to holding it or transacting business
24at the meeting.
   25(2)  The dissent or abstention from the action taken is
26entered in the minutes of the meeting.
   27(3)  The director delivers written notice of the director’s
28dissent or abstention to the presiding officer of the meeting
29before its adjournment or to the corporation immediately after
30adjournment of the meeting.
   31b.  The right of dissent or abstention is not available to a
32director who votes in favor of the action taken.
33   Sec. 102.  Section 490.825, Code 2020, is amended by striking
34the section and inserting in lieu thereof the following:
   35490.825  Committees of the board.
-107-   11.  Unless this chapter, the articles of incorporation,
2or the bylaws provide otherwise, a board of directors may
3establish one or more board committees composed exclusively
4of one or more directors to perform functions of the board of
5directors.
   62.  a.  The establishment of a board committee and
7appointment of members to it shall be approved by the greater
8of the following:
   9(1)  A majority of all the directors in office when the
10action is taken.
   11(2)  The number of directors required by the articles of
12incorporation or bylaws to take action under section 490.824.
   13b.  Paragraph “a” applies unless, in either case, this
14chapter or the articles of incorporation provide otherwise.
   153.  Sections 490.820 through 490.824 apply to board
16committees and their members.
   174.  A board committee may exercise the powers of the board
18of directors under section 490.801, to the extent specified by
19the board of directors or in the articles of incorporation or
20bylaws, except that a board committee shall not do any of the
21following:
   22a.  Authorize or approve distributions, except according to
23a formula or method, or within limits, prescribed by the board
24of directors.
   25b.  Approve or propose to shareholders action that this
26chapter requires be approved by shareholders.
   27c.  Fill vacancies on the board of directors or, subject to
28subsection 5, on any board committees.
   29d.  Adopt, amend, or repeal bylaws.
   305.  The board of directors may appoint one or more directors
31as alternate members of any board committee to replace any
32absent or disqualified member during the member’s absence
33or disqualification. If the articles of incorporation, the
34bylaws, or the resolution creating the board committee so
35provide, the member or members present at any board committee
-108-1meeting and not disqualified from voting may, by unanimous
2action, appoint another director to act in place of an absent
3or disqualified member during that member’s absence or
4disqualification.
5   Sec. 103.  Section 490.830, Code 2020, is amended by striking
6the section and inserting in lieu thereof the following:
   7490.830  Standards of conduct for directors.
   81.  Each member of the board of directors, when discharging
9the duties of a director, shall act in conformity with all of
10the following:
   11a.  In good faith.
   12b.  In a manner the director reasonably believes to be in the
13best interests of the corporation.
   142.  The members of the board of directors or a board
15committee, when becoming informed in connection with their
16decision-making function or devoting attention to their
17oversight function, shall discharge their duties with the care
18that a person in a like position would reasonably believe
19appropriate under similar circumstances.
   203.  In discharging board or board committee duties, a
21director shall disclose, or cause to be disclosed, to the other
22board or committee members information which the director
23knows is not already known by them but known by the director
24to be material to the discharge of their decision-making or
25oversight functions, except that disclosure is not required to
26the extent that the director reasonably believes that doing so
27would violate a duty imposed under law, a legally enforceable
28obligation of confidentiality, or a professional ethics rule.
   294.  In discharging board or board committee duties, a
30director who does not have knowledge that makes reliance
31unwarranted is entitled to rely on the performance by any of
32the persons specified in subsection 6, paragraph “a” or “c”, to
33whom the board may have delegated, formally or informally by
34course of conduct, the authority or duty to perform one or more
35of the board’s functions that are delegable under applicable
-109-1law.
   25.  In discharging board or board committee duties, a
3director who does not have knowledge that makes reliance
4unwarranted is entitled to rely on information, opinions,
5reports, or statements, including financial statements and
6other financial data, prepared or presented by any of the
7persons specified in subsection 6.
   86.  A director is entitled to rely, in accordance with
9subsection 4 or 5, on any of the following:
   10a.  One or more officers or employees of the corporation whom
11the director reasonably believes to be reliable and competent
12in the functions performed or the information, opinions,
13reports, or statements provided.
   14b.  Legal counsel, public accountants, or other persons
15retained by the corporation as to matters involving skills
16or expertise the director reasonably believes are any of the
17following:
   18(1)  Matters within the particular person’s professional or
19expert competence.
   20(2)  Matters as to which the particular person merits
21confidence.
   22c.  A board committee of which the director is not a member
23if the director reasonably believes the committee merits
24confidence.
25   Sec. 104.  Section 490.831, Code 2020, is amended by striking
26the section and inserting in lieu thereof the following:
   27490.831  Standards of liability for directors.
   281.  A director shall not be liable to the corporation or its
29shareholders for any decision to take or not to take action,
30or any failure to take any action, as a director, unless the
31party asserting liability in a proceeding establishes all of
32the following:
   33a.  No defense interposed by the director based on any of the
34following precludes liability:
   35(1)  A provision in the articles of incorporation authorized
-110-1by section 490.202, subsection 2, paragraph “d” or “f”.
   2(2)  The protection afforded by section 490.861 for action
3taken in compliance with section 490.862 or section 490.863.
   4(3)  The protection afforded by section 490.870.
   5b.  That the challenged conduct consisted or was the result
6of any of the following:
   7(1)  Action not in good faith.
   8(2)  A decision that satisfies any of the following:
   9(a)  That which the director did not reasonably believe to be
10in the best interests of the corporation.
   11(b)  As to which the director was not informed to an
12extent the director reasonably believed appropriate in the
13circumstances.
   14(3)  A lack of objectivity due to the director’s familial,
15financial, or business relationship with, or a lack of
16independence due to the director’s domination or control by,
17another person having a material interest in the challenged
18conduct, which also meets all of the following criteria:
   19(a)  Which relationship or which domination or control could
20reasonably be expected to have affected the director’s judgment
21respecting the challenged conduct in a manner adverse to the
22corporation.
   23(b)  After a reasonable expectation to such effect has been
24established, the director shall not have established that the
25challenged conduct was reasonably believed by the director to
26be in the best interests of the corporation.
   27(4)  A sustained failure of the director to devote attention
28to ongoing oversight of the business and affairs of the
29corporation, or a failure to devote timely attention, by
30making, or causing to be made, appropriate inquiry, when
31particular facts and circumstances of significant concern
32materialize that would alert a reasonably attentive director
33to the need for such inquiry.
   34(5)  Receipt of a financial benefit to which the director was
35not entitled or any other breach of the director’s duties to
-111-1deal fairly with the corporation and its shareholders that is
2actionable under applicable law.
   32.  a.  The party seeking to hold the director liable for
4money damages shall also have the burden of establishing all
5of the following:
   6(1)  That harm to the corporation or its shareholders has
7been suffered.
   8(2)  The harm suffered was proximately caused by the
9director’s challenged conduct.
   10b.  A party seeking to hold the director liable for other
11money payment under a legal remedy, such as compensation for
12the unauthorized use of corporate assets, shall also have
13whatever persuasion burden may be called for to establish that
14the payment sought is appropriate in the circumstances.
   15c.  A party seeking to hold the director liable for other
16money payment under an equitable remedy, such as profit
17recovery by or disgorgement to the corporation, shall also
18have whatever persuasion burden may be called for to establish
19that the equitable remedy sought is appropriate in the
20circumstances.
   213.  This section shall not do any of the following:
   22a.  In any instance where fairness is at issue, such
23as consideration of the fairness of a transaction to the
24corporation under section 490.861, subsection 2, paragraph
25“c”, alter the burden of proving the fact or lack of fairness
26otherwise applicable.
   27b.  Alter the fact or lack of liability of a director
28under another section of this chapter, such as the provisions
29governing the consequences of an unlawful distribution under
30section 490.833 or a transactional interest under section
31490.861.
   32c.  Affect any rights to which the corporation or a
33shareholder may be entitled under another statute of this state
34or the United States.
35   Sec. 105.  Section 490.833, Code 2020, is amended by striking
-112-1the section and inserting in lieu thereof the following:
   2490.833  Directors’ liability for unlawful distributions.
   31.  A director who votes for or assents to a distribution in
4excess of what may be authorized and made pursuant to section
5490.640, subsection 1, or section 490.1409, subsection 1, is
6personally liable to the corporation for the amount of the
7distribution that exceeds what could have been distributed
8without violating section 490.640, subsection 1, or section
9490.1409, subsection 1, if the party asserting liability
10establishes that when taking the action the director did not
11comply with section 490.830.
   122.  A director held liable under subsection 1 for an unlawful
13distribution is entitled to all of the following:
   14a.  Contribution from every other director who could be held
15liable under subsection 1 for the unlawful distribution.
   16b.  Recoupment from each shareholder of the prorata portion
17of the amount of the unlawful distribution the shareholder
18accepted, knowing the distribution was made in violation of
19section 490.640, subsection 1, or section 490.1409, subsection
201.
   213.  a.  A proceeding to enforce the liability of a director
22under subsection 1 is barred unless it is commenced within two
23years after any of the following:
   24(1)  The date on which the effect of the distribution was
25measured under section 490.640, subsection 5 or 8.
   26(2)  The date as of which the violation of section 490.640,
27subsection 1, occurred as the consequence of disregard of a
28restriction in the articles of incorporation.
   29(3)  The date on which the distribution of assets to
30shareholders under section 490.1409, subsection 1, was made.
   31b.  A proceeding to enforce contribution or recoupment
32under subsection 2 is barred unless it is commenced within
33one year after the liability of the claimant has been finally
34adjudicated under subsection 1.
35   Sec. 106.  Section 490.840, Code 2020, is amended by striking
-113-1the section and inserting in lieu thereof the following:
   2490.840  Officers.
   31.  A corporation has the officers described in its bylaws
4or appointed by the board of directors in accordance with the
5bylaws.
   62.  The board of directors may elect individuals to fill one
7or more offices of the corporation. An officer may appoint one
8or more officers if authorized by the bylaws or the board of
9directors.
   103.  The bylaws or the board of directors shall assign to an
11officer responsibility for maintaining and authenticating the
12records of the corporation required to be kept under section
13490.1601, subsection 1.
   144.  The same individual may simultaneously hold more than one
15office in a corporation.
16   Sec. 107.  Section 490.842, Code 2020, is amended by striking
17the section and inserting in lieu thereof the following:
   18490.842  Standards of conduct for officers.
   191.  An officer, when performing in such capacity, has the
20duty to act in conformity with all of the following:
   21a.  In good faith.
   22b.  With the care that a person in a like position would
23reasonably exercise under similar circumstances.
   24c.  In a manner the officer reasonably believes to be in the
25best interests of the corporation.
   262.  The duty of an officer includes the obligation to do all
27of the following:
   28a.  Inform the superior officer to whom, or the board of
29directors or the board committee to which, the officer reports
30of information about the affairs of the corporation known to
31the officer, within the scope of the officer’s functions, and
32known to the officer to be material to such superior officer,
33board, or committee.
   34b.  Inform the officer’s superior officer, or another
35appropriate person within the corporation, or the board of
-114-1directors, or a board committee, of any actual or probable
2material violation of law involving the corporation or material
3breach of duty to the corporation by an officer, employee,
4or agent of the corporation, that the officer believes has
5occurred or is likely to occur.
   63.  In discharging the officer’s duties, an officer who does
7not have knowledge that makes reliance unwarranted is entitled
8to rely on any of the following:
   9a.  The performance of properly delegated responsibilities
10by one or more employees of the corporation whom the officer
11reasonably believes to be reliable and competent in performing
12the responsibilities delegated.
   13b.  Information, opinions, reports, or statements, including
14financial statements and other financial data, prepared or
15presented by one or more employees of the corporation whom the
16officer reasonably believes to be reliable and competent in
17the matters presented or by legal counsel, public accountants,
18or other persons retained by the corporation as to matters
19involving skills or expertise the officer reasonably believes
20are any of the following:
   21(1)  Matters within the particular person’s professional or
22expert competence.
   23(2)  Matters as to which the particular person merits
24confidence.
   254.  An officer shall not be liable to the corporation or its
26shareholders for any decision to take or not to take action,
27or any failure to take any action, as an officer, if the duties
28of the office are performed in compliance with this section.
29Whether an officer who does not comply with this section shall
30have liability will depend in such instance on applicable
31law, including those principles of section 490.831 that have
32relevance.
33   Sec. 108.  Section 490.843, Code 2020, is amended by striking
34the section and inserting in lieu thereof the following:
   35490.843  Resignation and removal of officers.
-115-   11.  An officer may resign at any time by delivering a
2written notice to the board of directors, or its chair, or to
3the appointing officer or the secretary. A resignation is
4effective as provided in section 490.141, subsection 9, unless
5the notice provides for a delayed effectiveness, including
6effectiveness determined upon a future event or events. If
7effectiveness of a resignation is stated to be delayed and the
8board of directors or the appointing officer accepts the delay,
9the board of directors or the appointing officer may fill the
10pending vacancy before the delayed effectiveness but the new
11officer shall not take office until the vacancy occurs.
   122.  An officer may be removed at any time with or without
13cause by any of the following:
   14a.  The board of directors.
   15b.  The appointing officer, unless the bylaws or the board
16of directors provide otherwise.
   17c.  Any other officer if authorized by the bylaws or the
18board of directors.
   193.  As used in this section, “appointing officer” means the
20officer, including any successor to that officer, who appointed
21the officer resigning or being removed.
22   Sec. 109.  Section 490.844, Code 2020, is amended by striking
23the section and inserting in lieu thereof the following:
   24490.844  Contract rights of officers.
   251.  The election or appointment of an officer does not itself
26create contract rights.
   272.  An officer’s removal does not affect the officer’s
28contract rights, if any, with the corporation. An officer’s
29resignation does not affect the corporation’s contract rights,
30if any, with the officer.
31   Sec. 110.  Section 490.850, Code 2020, is amended by striking
32the section and inserting in lieu thereof the following:
   33490.850  Part definitions.
   34As used in this part:
   351.  “Corporation” includes any domestic or foreign
-116-1predecessor entity of a corporation in a merger.
   22.  “Director” or “officer” means an individual who is or
3was a director or officer, respectively, of a corporation
4or who, while a director or officer of the corporation, is
5or was serving at the corporation’s request as a director,
6officer, manager, partner, trustee, employee, or agent of
7another entity or employee benefit plan. A director or
8officer is considered to be serving an employee benefit plan
9at the corporation’s request if the individual’s duties to
10the corporation also impose duties on, or otherwise involve
11services by, the individual to the plan or to participants in
12or beneficiaries of the plan. “Director” or “officer” includes,
13unless the context requires otherwise, the estate or personal
14representative of a director or officer.
   153.  “Liability” means the obligation to pay a judgment,
16settlement, penalty, fine, including an excise tax assessed
17with respect to an employee benefit plan, or expenses incurred
18with respect to a proceeding.
   194.  a.  “Official capacity” means the following:
   20(1)  When used with respect to a director, the office of
21director in a corporation.
   22(2)  When used with respect to an officer, as contemplated
23in section 490.856, the office in a corporation held by the
24officer.
   25b.  “Official capacity” does not include service for any
26other domestic or foreign corporation or any joint venture,
27trust, employee benefit plan, or other entity.
   285.  “Party” means an individual who was, is, or is threatened
29to be made a defendant or respondent in a proceeding.
   306.  “Proceeding” means any threatened, pending, or completed
31action, suit, or proceeding, whether civil, criminal,
32administrative, arbitrative, or investigative and whether
33formal or informal.
34   Sec. 111.  Section 490.851, Code 2020, is amended by striking
35the section and inserting in lieu thereof the following:
-117-   1490.851  Permissible indemnification.
   21.  Except as otherwise provided in this section, a
3corporation may indemnify an individual who is a party to
4a proceeding because the individual is a director against
5liability incurred in the proceeding if any of the following
6apply:
   7a.  All of the following apply:
   8(1)  The director’s conduct was in good faith.
   9(2)  The director reasonably believed:
   10(a)  In the case of conduct in an official capacity, that
11the director’s conduct was in the best interests of the
12corporation.
   13(b)  In all other cases, that the director’s conduct was at
14least not opposed to the best interests of the corporation.
   15(3)  In the case of any criminal proceeding, the director
16had no reasonable cause to believe the director’s conduct was
17unlawful.
   18b.  The director engaged in conduct for which broader
19indemnification has been made permissible or obligatory under a
20provision of the articles of incorporation, as authorized by
21section 490.202, subsection 2, paragraph “e”.
   222.  A director’s conduct with respect to an employee benefit
23plan for a purpose the director reasonably believed to be in
24the interests of the participants in, and the beneficiaries
25of, the plan is conduct that satisfies the requirement of
26subsection 1, paragraph “a”, subparagraph (2), subparagraph
27division (b).
   283.  The termination of a proceeding by judgment, order,
29settlement, or conviction, or upon a plea of nolo contendere
30or its equivalent, is not, of itself, determinative that
31the director did not meet the relevant standard of conduct
32described in this section.
   334.  Unless ordered by a court under section 490.854,
34subsection 1, paragraph “c”, a corporation shall not indemnify a
35director in any of the following circumstances:
-118-   1a.  In connection with a proceeding by or in the right of the
2corporation, except for expenses incurred in connection with
3the proceeding if it is determined that the director has met
4the relevant standard of conduct under subsection 1.
   5b.  In connection with any proceeding with respect to conduct
6for which the director was adjudged liable on the basis of
7receiving a financial benefit to which the director was not
8entitled, regardless of whether it involved action in the
9director’s official capacity.
10   Sec. 112.  Section 490.852, Code 2020, is amended by striking
11the section and inserting in lieu thereof the following:
   12490.852  Mandatory indemnification.
   13A corporation shall indemnify a director who was wholly
14successful, on the merits or otherwise, in the defense of
15any proceeding to which the director was a party because the
16director is or was a director of the corporation against
17expenses incurred by the director in connection with the
18proceeding.
19   Sec. 113.  Section 490.853, Code 2020, is amended by striking
20the section and inserting in lieu thereof the following:
   21490.853  Advance for expenses.
   221.  A corporation may, before final disposition of a
23proceeding, advance funds to pay for or reimburse expenses
24incurred in connection with the proceeding by an individual
25who is a party to the proceeding because that individual is a
26director, if the director delivers to the corporation a signed
27written undertaking of the director to repay any funds advanced
28and all of the following apply:
   29a.  The director is not entitled to mandatory indemnification
30under section 490.852.
   31b.  It is ultimately determined under section 490.854 or
32490.855 that the director is not entitled to indemnification.
   332.  The undertaking required by subsection 1 must be an
34unlimited general obligation of the director but need not be
35secured and may be accepted without reference to the financial
-119-1ability of the director to make repayment.
   23.  Authorizations under this section shall be made by any
3of the following:
   4a.  By the board of directors as follows:
   5(1)  If there are two or more qualified directors, by a
6majority vote of all of the qualified directors, a majority
7of whom shall for such purpose constitute a quorum, or by a
8majority of the members of a committee consisting solely of two
9or more qualified directors appointed by such a vote.
   10(2)  If there are fewer than two qualified directors,
11by the vote necessary for action by the board of directors
12in accordance with section 490.824, subsection 3, in which
13authorization directors who are not qualified directors may
14participate.
   15b.  By the shareholders, but shares owned by or voted under
16the control of a director who at the time is not a qualified
17director shall not be voted on the authorization.
18   Sec. 114.  Section 490.854, Code 2020, is amended by striking
19the section and inserting in lieu thereof the following:
   20490.854  Court-ordered indemnification and advance for
21expenses.
   221.  A person who is a party to a proceeding because the
23person is a director may apply for indemnification or an
24advance for expenses to the court conducting the proceeding
25or to another court of competent jurisdiction. After receipt
26of an application and after giving any notice it considers
27necessary, the court shall do any of the following:
   28a.  Order indemnification if the court determines that the
29director is entitled to mandatory indemnification under section
30490.852.
   31b.  Order indemnification or advance for expenses if
32the court determines that the director is entitled to
33indemnification or advance for expenses pursuant to a provision
34authorized by section 490.858, subsection 1.
   35c.  (1)  Order indemnification or advance for expenses if the
-120-1court determines, in view of all the relevant circumstances,
2that it is fair and reasonable to do any of the following:
   3(a)  Indemnify the director.
   4(b)  Advance expenses to the director.
   5(2)  The court shall order indemnification or advance for
6expenses, even if in the case of subparagraph (1), subparagraph
7division (a) or (b), the director has not met the relevant
8standard of conduct set forth in section 490.851, subsection 1,
9failed to comply with section 490.853 or was adjudged liable
10in a proceeding referred to in section 490.851, subsection 4,
11paragraph “a” or “b”. However, if the director was adjudged
12so liable the director’s indemnification shall be limited to
13expenses incurred in connection with the proceeding.
   142.  If the court determines that the director is entitled
15to indemnification under subsection 1, paragraph “a”, or to
16indemnification or advance for expenses under subsection 1,
17paragraph “b”, it shall also order the corporation to pay the
18director’s expenses incurred in connection with obtaining
19court-ordered indemnification or advance for expenses.
20If the court determines that the director is entitled to
21indemnification or advance for expenses under subsection 1,
22paragraph “c”, it may also order the corporation to pay the
23director’s expenses to obtain court-ordered indemnification or
24advance for expenses.
25   Sec. 115.  Section 490.855, Code 2020, is amended by striking
26the section and inserting in lieu thereof the following:
   27490.855  Determination and authorization of indemnification.
   281.  A corporation shall not indemnify a director under
29section 490.851 unless authorized for a specific proceeding
30after a determination has been made that indemnification is
31permissible because the director has met the relevant standard
32of conduct set forth in section 490.851.
   332.  The determination shall be made by any of the following:
   34a.  If there are two or more qualified directors, by the
35board of directors by a majority vote of all the qualified
-121-1directors, a majority of whom shall for such purpose constitute
2a quorum, or by a majority of the members of a committee of two
3or more qualified directors appointed by such a vote.
   4b.  By special legal counsel selected in one of the following
5manners:
   6(1)  In the manner prescribed in paragraph “a”.
   7(2)  If there are fewer than two qualified directors,
8selected by the board of directors, in which selection
9directors who are not qualified directors may participate.
   10c.  By the shareholders, but shares owned by or voted under
11the control of a director who at the time is not a qualified
12director shall not be voted on the determination.
   133.  Authorization of indemnification shall be made in
14the same manner as the determination that indemnification is
15permissible, except that if there are fewer than two qualified
16directors or if the determination is made by special legal
17counsel, authorization of indemnification shall be made by
18those entitled to select special legal counsel under subsection
192, paragraph “b”, subparagraph (2).
20   Sec. 116.  Section 490.856, Code 2020, is amended by striking
21the section and inserting in lieu thereof the following:
   22490.856  Indemnification of officers.
   231.  A corporation may indemnify and advance expenses under
24this part to an officer who is a party to a proceeding because
25the person is an officer, according to all of the following:
   26a.  To the same extent as a director.
   27b.  If the person is an officer but not a director, to
28such further extent as may be provided by the articles of
29incorporation or bylaws, or by a resolution adopted or a
30contract approved by the board of directors or shareholders,
31except for any of the following:
   32(1)  Liability in connection with a proceeding by or in the
33right of the corporation other than for expenses incurred in
34connection with the proceeding.
   35(2)  Liability arising out of conduct that constitutes any
-122-1of the following:
   2(a)  Receipt by the officer of a financial benefit to which
3the officer is not entitled.
   4(b)  An intentional infliction of harm on the corporation or
5the shareholders.
   6(c)  An intentional violation of criminal law.
   72.  The provisions of subsection 1, paragraph “b”, shall
8apply to an officer who is also a director, if the officer is
9made a party to the proceeding based on an act or omission
10solely as an officer.
   113.  An officer who is not a director is entitled to mandatory
12indemnification under section 490.852, and may apply to a court
13under section 490.854 for indemnification or an advance for
14expenses, in each case to the same extent to which a director
15may be entitled to indemnification or advance for expenses
16under those sections.
17   Sec. 117.  Section 490.857, Code 2020, is amended by striking
18the section and inserting in lieu thereof the following:
   19490.857  Insurance.
   20A corporation may purchase and maintain insurance on
21behalf of an individual who is a director or officer of
22the corporation, or who, while a director or officer of the
23corporation, serves at the corporation’s request as a director,
24officer, partner, trustee, employee, or agent of another
25domestic or foreign corporation, or a joint venture, trust,
26employee benefit plan, or other entity, against liability
27asserted against or incurred by the individual in that capacity
28or arising from the individual’s status as a director or
29officer, regardless of whether the corporation would have power
30to indemnify or advance expenses to the individual against the
31same liability under this part.
32   Sec. 118.  Section 490.858, Code 2020, is amended by striking
33the section and inserting in lieu thereof the following:
   34490.858  Variation by corporate action — application of part.
   351.  A corporation may, by a provision in its articles
-123-1of incorporation or bylaws or in a resolution adopted or a
2contract approved by the board of directors or shareholders,
3obligate itself in advance of the act or omission giving rise
4to a proceeding to provide indemnification in accordance
5with section 490.851 or advance funds to pay for or
6reimburse expenses in accordance with section 490.853. Any
7such obligatory provision shall be deemed to satisfy the
8requirements for authorization referred to in section 490.853,
9subsection 3, and in section 490.855, subsection 3. Any
10such provision that obligates the corporation to provide
11indemnification to the fullest extent permitted by law shall be
12deemed to obligate the corporation to advance funds to pay for
13or reimburse expenses in accordance with section 490.853 to the
14fullest extent permitted by law, unless the provision expressly
15provides otherwise.
   162.  A right of indemnification or to advances for expenses
17created by this part or under subsection 1 and in effect at
18the time of an act or omission shall not be eliminated or
19impaired with respect to such act or omission by an amendment
20of the articles of incorporation or bylaws or a resolution
21of the board of directors or shareholders, adopted after the
22occurrence of such act or omission, unless, in the case of
23a right created under subsection 1, the provision creating
24such right and in effect at the time of such act or omission
25explicitly authorizes such elimination or impairment after such
26act or omission has occurred.
   273.  Any provision pursuant to subsection 1 shall not obligate
28the corporation to indemnify or advance expenses to a director
29of a predecessor of the corporation, pertaining to conduct
30with respect to the predecessor, unless otherwise expressly
31provided. Any provision for indemnification or advance for
32expenses in the articles of incorporation, or bylaws, or a
33resolution of the board of directors or shareholders of a
34predecessor of the corporation in a merger or in a contract
35to which the predecessor is a party, existing at the time the
-124-1merger takes effect, shall be governed by section 490.1107,
2subsection 1, paragraph “d”.
   34.  Subject to subsection 2, a corporation may, by a
4provision in its articles of incorporation, limit any of the
5rights to indemnification or advance for expenses created by or
6pursuant to this part.
   75.  This part does not limit a corporation’s power to pay
8or reimburse expenses incurred by a director or an officer in
9connection with appearing as a witness in a proceeding at a
10time when the director or officer is not a party.
   116.  This part does not limit a corporation’s power to
12indemnify, advance expenses to, or provide or maintain
13insurance on behalf of an employee or agent.
14   Sec. 119.  Section 490.860, Code 2020, is amended by striking
15the section and inserting in lieu thereof the following:
   16490.860  Part definitions.
   17As used in this part, unless otherwise specified:
   181.  “Control”, including the term “controlled by”, means any
19of the following:
   20a.  Having the power, directly or indirectly, to elect or
21remove a majority of the members of the board of directors
22or other governing body of an entity, whether through the
23ownership of voting shares or interests, by contract, or
24otherwise.
   25b.  Being subject to a majority of the risk of loss from the
26entity’s activities or entitled to receive a majority of the
27entity’s residual returns.
   282.  “Director’s conflicting interest transaction” means
29a transaction effected or proposed to be effected by the
30corporation, or by an entity controlled by the corporation, to
31which, or respecting which, any of the following applies:
   32a.  To which, at the relevant time, the director is a party.
   33b.  Respecting which, at the relevant time, the director
34had knowledge and a material financial interest known to the
35director.
-125-   1c.  Respecting which, at the relevant time, the director knew
2that a related person was a party or had a material financial
3interest.
   43.  “Fair to the corporation” means, for purposes of section
5490.861, subsection 2, paragraph “c”, that the transaction
6as a whole was beneficial to the corporation, taking into
7appropriate account whether it was all of the following:
   8a.  Fair in terms of the director’s dealings with the
9corporation.
   10b.  Comparable to what might have been obtainable in an arm’s
11length transaction, given the consideration paid or received
12by the corporation.
   134.  “Material financial interest” means a financial interest
14in a transaction that would reasonably be expected to impair
15the objectivity of the director’s judgment when participating
16in action on the authorization of the transaction.
   175.  “Related person” means any of the following:
   18a.  The individual’s spouse.
   19b.  A child, stepchild, grandchild, parent, stepparent,
20grandparent, sibling, stepsibling, half sibling, aunt,
21uncle, niece, or nephew, or spouse of any such person, of the
22individual or of the individual’s spouse.
   23c.  A natural person living in the same home as the
24individual.
   25d.  An entity, other than the corporation or an entity
26controlled by the corporation, controlled by the individual or
27any person specified in this subsection.
   28e.  Any of the following:
   29(1)  A domestic or foreign business or nonprofit
30corporation, other than the corporation or an entity controlled
31by the corporation, of which the individual is a director.
   32(2)  A domestic or foreign unincorporated entity of which the
33individual is a general partner or a member of the governing
34body.
   35(3)  A domestic or foreign individual, trust, or estate
-126-1for whom or of which the individual is a trustee, guardian,
2personal representative, or like fiduciary.
   3f.  A person that is, or an entity that is controlled by, an
4employer of the individual.
   56.  “Relevant time” means the following:
   6a.  The time at which directors’ action respecting the
7transaction is taken in compliance with section 490.862.
   8b.  If the transaction is not brought before the board
9of directors or a board committee for action under section
10490.862, at the time the corporation or an entity controlled
11by the corporation becomes legally obligated to consummate the
12transaction.
   137.  “Required disclosure” means disclosure of all of the
14following:
   15a.  The existence and nature of the director’s conflicting
16interest.
   17b.  All facts known to the director respecting the subject
18matter of the transaction that a director free of such
19conflicting interest would reasonably believe to be material in
20deciding whether to proceed with the transaction.
21   Sec. 120.  Section 490.861, Code 2020, is amended by striking
22the section and inserting in lieu thereof the following:
   23490.861  Judicial action.
   241.  A transaction effected or proposed to be effected by the
25corporation, or by an entity controlled by the corporation,
26shall not be the subject of equitable relief, or give rise to
27an award of damages or other sanctions against a director of
28the corporation, in a proceeding by a shareholder or by or in
29the right of the corporation, on the ground that the director
30has an interest respecting the transaction, if it is not a
31director’s conflicting interest transaction.
   322.  A director’s conflicting interest transaction shall
33not be the subject of equitable relief, or give rise to an
34award of damages or other sanctions against a director of the
35corporation, in a proceeding by a shareholder or by or in the
-127-1right of the corporation, on the ground that the director has
2an interest respecting the transaction, if any of the following
3apply:
   4a.  Directors’ action respecting the transaction was taken in
5compliance with section 490.862 at any time.
   6b.  Shareholders’ action respecting the transaction was taken
7in compliance with section 490.863 at any time.
   8c.  The transaction, judged according to the circumstances
9at the relevant time, is established to have been fair to the
10corporation.
11   Sec. 121.  Section 490.862, Code 2020, is amended by striking
12the section and inserting in lieu thereof the following:
   13490.862  Directors’ action.
   141.  Directors’ action respecting a director’s conflicting
15interest transaction is effective for purposes of section
16490.861, subsection 2, paragraph “a”, if the transaction has
17been authorized by the affirmative vote of a majority, but
18no fewer than two, of the qualified directors who voted on
19the transaction, after required disclosure by the conflicted
20director of information not already known by such qualified
21directors, or after modified disclosure in compliance with
22subsection 2, provided that all of the following apply:
   23a.  The qualified directors have deliberated and voted
24outside the presence of and without the participation by any
25other director.
   26b.  Where the action has been taken by a board committee,
27all members of the committee were qualified directors, and any
28of the following apply:
   29(1)  The committee was composed of all the qualified
30directors on the board of directors.
   31(2)  The members of the committee were appointed by the
32affirmative vote of a majority of the qualified directors on
33the board of directors.
   342.  Notwithstanding subsection 1, when a transaction is
35a director’s conflicting interest transaction only because a
-128-1related person described in section 490.860, subsection 5,
2paragraph “e” or “f”, is a party to or has a material financial
3interest in the transaction, the conflicted director is not
4obligated to make required disclosure to the extent that the
5director reasonably believes that doing so would violate a
6duty imposed under law, a legally enforceable obligation of
7confidentiality, or a professional ethics rule, provided that
8the conflicted director discloses to the qualified directors
9voting on the transaction all of the following:
   10a.  All information required to be disclosed that is not so
11violative.
   12b.  The existence and nature of the director’s conflicting
13interest.
   14c.  The nature of the conflicted director’s duty not to
15disclose the confidential information.
   163.  A majority, but no fewer than two, of all the qualified
17directors on the board of directors, or on the board committee,
18constitutes a quorum for purposes of action that complies with
19this section.
   204.  Where directors’ action under this section does not
21satisfy a quorum or voting requirement applicable to the
22authorization of the transaction by reason of the articles of
23incorporation or bylaws, or a provision of law, independent
24action to satisfy those authorization requirements shall be
25taken by the board of directors or a board committee, in
26which action directors who are not qualified directors may
27participate.
28   Sec. 122.  Section 490.863, Code 2020, is amended by striking
29the section and inserting in lieu thereof the following:
   30490.863  Shareholders’ action.
   311.  a.  Shareholders’ action respecting a director’s
32conflicting interest transaction is effective for purposes of
33section 490.861, subsection 2, paragraph “b”, if a majority of
34the votes cast by the holders of all qualified shares are in
35favor of the transaction after all of the following occur:
-129-   1(1)  Notice to shareholders describing the action to be taken
2respecting the transaction.
   3(2)  Provision to the corporation of the information
4referred to in subsection 2.
   5(3)  Communication to the shareholders entitled to vote
6on the transaction of the information that is the subject of
7required disclosure, to the extent the information is not known
8by them.
   9b.  In the case of shareholders’ action at a meeting, the
10shareholders entitled to vote shall be determined as of the
11record date for notice of the meeting.
   122.  A director who has a conflicting interest respecting
13the transaction shall, before the shareholders’ vote, inform
14the secretary or other officer or agent of the corporation
15authorized to tabulate votes, in writing, of the number of
16shares that the director knows are not qualified shares under
17subsection 3, and the identity of the holders of those shares.
   183.  As used in this section:
   19a.  “Holder” means and “held by” refers to shares held
20by a record shareholder, a beneficial shareholder, or an
21unrestricted voting trust beneficial owner.
   22b.  “Qualified shares” means all shares entitled to be
23voted with respect to the transaction except for shares that
24the secretary or other officer or agent of the corporation
25authorized to tabulate votes either knows, or under subsection
262 is notified, are held by any of the following:
   27(1)  A director who has a conflicting interest respecting the
28transaction.
   29(2)  A related person of the director, excluding a person
30described in section 490.860, subsection 5, paragraph “f”.
   314.  A majority of the votes entitled to be cast by the
32holders of all qualified shares constitutes a quorum for
33purposes of compliance with this section. Subject to the
34provisions of subsection 5, shareholders’ action that otherwise
35complies with this section is not affected by the presence of
-130-1holders, or by the voting, of shares that are not qualified
2shares.
   35.  If a shareholders’ vote does not comply with subsection
41 solely because of a director’s failure to comply with
5subsection 2, and if the director establishes that the failure
6was not intended to influence and did not in fact determine the
7outcome of the vote, the court may take such action respecting
8the transaction and the director, and may give such effect,
9if any, to the shareholders’ vote, as the court considers
10appropriate in the circumstances.
   116.  Where shareholders’ action under this section does
12not satisfy a quorum or voting requirement applicable to the
13authorization of the transaction by reason of the articles of
14incorporation or bylaws, or a provision of law, independent
15action to satisfy those authorization requirements shall be
16taken by the shareholders, in which action shares that are not
17qualified shares may participate.
18   Sec. 123.  Section 490.870, Code 2020, is amended by striking
19the section and inserting in lieu thereof the following:
   20490.870  Business opportunities.
   211.  If a director or officer pursues or takes advantage of
22a business opportunity directly, or indirectly through or on
23behalf of another person, that action shall not be the subject
24of equitable relief, or give rise to an award of damages or
25other sanctions against the director, officer, or other person,
26in a proceeding by or in the right of the corporation on the
27ground that the opportunity should have first been offered to
28the corporation, if any of the following apply:
   29a.  Before the director, officer, or other person becomes
30legally obligated respecting the opportunity, the director or
31officer brings it to the attention of the corporation and any
32of the following apply:
   33(1)  Action by qualified directors disclaiming the
34corporation’s interest in the opportunity is taken in
35compliance with the same procedures as are set forth in section
-131-1490.862.
   2(2)  Shareholders’ action disclaiming the corporation’s
3interest in the opportunity is taken in compliance with the
4procedures set forth in section 490.863, in either case as if
5the decision being made concerned a director’s conflicting
6interest transaction; except that, rather than making required
7disclosure as defined in section 490.860, the director or
8officer shall have made prior disclosure to those acting on
9behalf of the corporation of all material facts concerning the
10business opportunity known to the director or officer.
   11b.  The duty to offer the corporation the business
12opportunity has been limited or eliminated pursuant to a
13provision of the articles of incorporation adopted, and where
14required, made effective by action of qualified directors, in
15accordance with section 490.202, subsection 2, paragraph “f”.
   162.  In any proceeding seeking equitable relief or other
17remedies based upon an alleged improper pursuit or taking
18advantage of a business opportunity by a director or officer,
19directly, or indirectly through or on behalf of another
20person, the fact that the director or officer did not employ
21the procedure described in subsection 1, paragraph “a”,
22subparagraph (1) or (2), before pursuing or taking advantage
23of the opportunity shall not create an implication that the
24opportunity should have been first presented to the corporation
25or alter the burden of proof otherwise applicable to establish
26that the director or officer breached a duty to the corporation
27in the circumstances.
28   Sec. 124.  Section 490.901, Code 2020, is amended by striking
29the section and inserting in lieu thereof the following:
   30490.901  Subchapter definitions.
   311.  As used in this subchapter:
   32a.  “Conversion” means a transaction pursuant to part C.
   33b.  “Converted entity” means the converting entity as it
34continues in existence after a conversion.
   35c.  “Converting entity” means the domestic corporation or
-132-1eligible entity that approves a plan of conversion pursuant to
2section 490.932 or the foreign eligible entity that approves a
3conversion pursuant to the organic law of the eligible entity.
   4d.  “Domesticated corporation” means the domesticating
5corporation as it continues in existence after a domestication.
   6e.  “Domesticating corporation” means the domestic
7corporation that approves a plan of domestication pursuant
8to section 490.921 or the foreign corporation that approves
9a domestication pursuant to the organic law of the foreign
10corporation.
   11f.  “Domestication” means a transaction pursuant to part B.
   12g.  “Protected agreement” means any of the following:
   13(1)  A document evidencing indebtedness of a domestic
14corporation or eligible entity and any related agreement in
15effect immediately before the enactment date.
   16(2)  An agreement that is binding on a domestic corporation
17or eligible entity immediately before the enactment date.
   18(3)  The articles of incorporation or bylaws of a domestic
19corporation or the organic rules of a domestic eligible entity,
20in each case in effect immediately before the enactment date.
   21(4)  An agreement that is binding on any of the shareholders,
22members, interest holders, directors, or other governors of a
23domestic corporation or eligible entity, in their capacities as
24such, immediately before the enactment date.
   252.  As used in subsection 1 and sections 490.920 and
26490.930, “enactment date” means July 1, 2021, as it relates
27to domestications and January 1, 2009, as it relates to
28conversions.
29   Sec. 125.  Section 490.902, Code 2020, is amended by striking
30the section and inserting in lieu thereof the following:
   31490.902  Excluded transactions.
   32This subchapter shall not be used to effect a transaction
33that converts a company organized on the mutual principle to
34one organized on the basis of share ownership.
35   Sec. 126.  NEW SECTION.  490.903  Required approvals.
-133-   1If a domestic or foreign corporation or eligible entity
2shall not be a party to a merger without the approval of the
3superintendent of banking, the commissioner of insurance,
4or the Iowa utility board, and the applicable statutes or
5regulations do not specifically deal with transactions under
6this subchapter but do require such approval for mergers,
7a corporation or eligible entity shall not be a party to a
8transaction under this subchapter without the prior approval of
9that agency or official.
10   Sec. 127.  NEW SECTION.  490.904  Relationship of subchapter
11to other laws.
   12A transaction effected under this subchapter shall not
13create or impair a right, duty, or obligation of a person under
14the statutory law of this state other than this subchapter
15relating to a change in control, business combination,
16control-share acquisition, or similar transaction involving
17a domesticating or converting domestic corporation, unless
18the approval of the plan of domestication or conversion is by
19a vote of the shareholders or the board of directors which
20would be sufficient to create or impair the right, duty, or
21obligation directly under that law.
22   Sec. 128.  NEW SECTION.  490.905  Foreign insurance companies
23becoming domestic.
   241.  The secretary of state, upon a corporation complying with
25this section and upon the filing of articles of incorporation
26and upon receipt of the fees as provided in this chapter,
27shall issue an acknowledgment of receipt of document as
28of the date of the filing of the articles of incorporation
29with the secretary of state. The acknowledgment of receipt
30of document shall state on its face that it is issued in
31accordance with this section. The secretary of state shall
32then notify the appropriate officer of the state or country of
33the corporation’s last domicile that the corporation is now a
34domestic corporation domiciled in this state. This section
35applies to life insurance companies, and to insurance companies
-134-1doing business under chapter 515.
   22.  A corporation becoming domiciled in this state under
3subsection 1 shall not be required to comply with any other
4requirements under this subchapter.
5   Sec. 129.  NEW SECTION.  490.920  Domestication.
   61.  By complying with the provisions of this part applicable
7to foreign corporations, a foreign corporation may become a
8domestic corporation if the domestication is permitted by the
9organic law of the foreign corporation.
   102.  By complying with the provisions of this part, a domestic
11corporation may become a foreign corporation pursuant to a
12plan of domestication if the domestication is permitted by the
13organic law of the foreign corporation.
   143.  The plan of domestication must include all of the
15following:
   16a.  The name of the domesticating corporation.
   17b.  The name and jurisdiction of formation of the
18domesticated corporation.
   19c.  The manner and basis of reclassifying the shares of the
20domesticating corporation into shares or other securities,
21obligations, rights to acquire shares or other securities,
22cash, other property, or any combination of the foregoing.
   23d.  The proposed articles of incorporation and bylaws of the
24domesticated corporation.
   25e.  The other terms and conditions of the domestication.
   264.  In addition to the requirements of subsection 3, a plan
27of domestication may contain any other provision not prohibited
28by law.
   295.  The terms of a plan of domestication may be made
30dependent upon facts objectively ascertainable outside the plan
31in accordance with section 490.120, subsection 11.
   326.  If a protected agreement of a domestic domesticating
33corporation in effect immediately before the domestication
34becomes effective contains a provision applying to a merger
35of the corporation and the agreement does not refer to a
-135-1domestication of the corporation, the provision applies to a
2domestication of the corporation as if the domestication were a
3merger until such time as the provision is first amended after
4the enactment date.
5   Sec. 130.  NEW SECTION.  490.921  Action on a plan of
6domestication.
   7In the case of a domestication of a domestic corporation
8into a foreign jurisdiction, the plan of domestication shall be
9adopted in the following manner:
   101.  The plan of domestication shall first be adopted by the
11board of directors.
   122.  a.  The plan of domestication shall then be approved by
13the shareholders. In submitting the plan of domestication to
14the shareholders for approval, the board of directors shall
15recommend that the shareholders approve the plan, unless any of
16the following applies:
   17(1)  The board of directors makes a determination that
18because of conflicts of interest or other special circumstances
19it should not make such a recommendation.
   20(2)  Section 490.826 applies.
   21b.  If paragraph “a”, subparagraph (1) or (2) applies, the
22board shall inform the shareholders of the basis for its so
23proceeding.
   243.  The board of directors may set conditions for approval
25of the plan of domestication by the shareholders or the
26effectiveness of the plan of domestication.
   274.  If the approval of the shareholders is to be given at
28a meeting, the corporation shall notify each shareholder,
29regardless of whether entitled to vote, of the meeting of
30shareholders at which the plan of domestication is to be
31submitted for approval. The notice must state that the
32purpose, or one of the purposes, of the meeting is to consider
33the plan of domestication and must contain or be accompanied
34by a copy or summary of the plan. The notice must include
35or be accompanied by a copy of the articles of incorporation
-136-1and the bylaws as they will be in effect immediately after the
2domestication.
   35.  Unless the articles of incorporation, bylaws, or the
4board of directors acting pursuant to subsection 3, require
5a greater vote or a greater quorum, approval of the plan of
6domestication requires all of the following:
   7a.  The approval of the shareholders at a meeting at which a
8quorum exists consisting of a majority of the votes entitled
9to be cast on the plan.
   10b.  Except as provided in subsection 6, the approval of
11each class or series of shares voting as a separate voting
12group at a meeting at which a quorum of the voting group exists
13consisting of a majority of the votes entitled to be cast on
14the plan by that voting group.
   156.  The articles of incorporation may expressly limit or
16eliminate the separate voting rights provided in subsection
175, paragraph “b”, as to any class or series of shares, except
18when the articles of incorporation of the foreign corporation
19resulting from the domestication include what would be in
20effect an amendment that would entitle the class or series to
21vote as a separate group under section 490.1004 if it were
22a proposed amendment of the articles of incorporation of the
23domestic domesticating corporation.
   247.  If as a result of a domestication one or more
25shareholders of a domestic domesticating corporation would
26become subject to interest holder liability, approval of the
27plan of domestication shall require the signing in connection
28with the domestication, by each such shareholder, of a separate
29written consent to become subject to such interest holder
30liability, unless in the case of a shareholder that already has
31interest holder liability with respect to the domesticating
32corporation, the terms and conditions of the interest holder
33liability with respect to the domesticated corporation are
34substantially identical to those of the existing interest
35holder liability, other than for changes that eliminate or
-137-1reduce such interest holder liability.
2   Sec. 131.  NEW SECTION.  490.922  Articles of domestication
3— effectiveness.
   41.  After a plan of domestication of a domestic corporation
5has been adopted and approved as required by this chapter, or a
6foreign corporation that is the domesticating corporation has
7approved a domestication as required under its organic law,
8articles of domestication shall be signed by the domesticating
9corporation. The articles must set forth all of the following:
   10a.  The name of the domesticating corporation and its
11jurisdiction of formation.
   12b.  The name and jurisdiction of formation of the
13domesticated corporation.
   14c.  If the domesticating corporation is a domestic
15corporation, a statement that the plan of domestication
16was approved in accordance with this subchapter or, if the
17domesticating corporation is a foreign corporation, a statement
18that the domestication was approved in accordance with its
19organic law.
   202.  If the domesticated corporation is a domestic
21corporation, the articles of domestication must attach
22articles of incorporation of the domesticated corporation that
23satisfy the requirements of section 490.202. Provisions that
24would not be required to be included in restated articles of
25incorporation may be omitted from the articles of incorporation
26attached to the articles of domestication.
   273.  The articles of domestication shall be delivered to the
28secretary of state for filing, and shall take effect at the
29effective date determined in accordance with section 490.123.
   304.  If the domesticated corporation is a domestic
31corporation, the domestication becomes effective when the
32articles of domestication are effective. If the domesticated
33corporation is a foreign corporation, the domestication becomes
34effective on the later of the following:
   35a.  The date and time provided by the organic law of the
-138-1domesticated corporation.
   2b.  When the articles of domestication are effective.
   35.  If the domesticating corporation is a foreign
4corporation that is registered to do business in this state
5under subchapter XV, its registration statement shall
6be canceled automatically when the domestication becomes
7effective.
8   Sec. 132.  NEW SECTION.  490.923  Amendment of plan of
9domestication — abandonment.
   101.  A plan of domestication of a domestic corporation may be
11amended by any of the following manners:
   12a.  In the same manner as the plan was approved, if the plan
13does not provide for the manner in which it may be amended.
   14b.  In the manner provided in the plan, except that a
15shareholder that was entitled to vote on or consent to approval
16of the plan is entitled to vote on or consent to any amendment
17of the plan that will change any of the following:
   18(1)  The amount or kind of shares or other securities,
19obligations, rights to acquire shares or other securities,
20cash, other property, or any combination of the foregoing, to
21be received by any of the shareholders of the domesticating
22corporation under the plan.
   23(2)  The articles of incorporation or bylaws of the
24domesticated corporation that will be in effect immediately
25after the domestication becomes effective, except for changes
26that do not require approval of the shareholders of the
27domesticated corporation under its organic law or its proposed
28articles of incorporation or bylaws as set forth in the plan.
   29(3)  Any of the other terms or conditions of the plan, if the
30change would adversely affect the shareholder in any material
31respect.
   322.  After a plan of domestication has been adopted and
33approved by a domestic corporation as required by this part,
34and before the articles of domestication have become effective,
35the plan may be abandoned by the corporation without action by
-139-1its shareholders in accordance with any procedures set forth in
2the plan or, if no such procedures are set forth in the plan, in
3the manner determined by the board of directors.
   43.  If a domestication is abandoned after the articles of
5domestication have been delivered to the secretary of state for
6filing but before the articles of domestication have become
7effective, articles of abandonment, signed by the domesticating
8corporation, must be delivered to the secretary of state for
9filing before the articles of domestication become effective.
10The articles of abandonment take effect upon filing, and the
11domestication shall be deemed abandoned and shall not become
12effective. The articles of abandonment must contain all of the
13following:
   14a.  The name of the domesticating corporation.
   15b.  The date on which the articles of domestication were
16filed by the secretary of state.
   17c.  A statement that the domestication has been abandoned in
18accordance with this section.
19   Sec. 133.  NEW SECTION.  490.924  Effect of domestication.
   201.  When a domestication becomes effective all of the
21following apply:
   22a.  All property owned by, and every contract right possessed
23by, the domesticating corporation are the property and contract
24rights of the domesticated corporation without transfer,
25reversion, or impairment.
   26b.  All debts, obligations, and other liabilities of the
27domesticating corporation are the debts, obligations, and other
28liabilities of the domesticated corporation.
   29c.  The name of the domesticated corporation may but need not
30be substituted for the name of the domesticating corporation in
31any pending proceeding.
   32d.  The articles of incorporation and bylaws of the
33domesticated corporation become effective.
   34e.  The shares of the domesticating corporation are
35reclassified into shares or other securities, obligations,
-140-1rights to acquire shares or other securities, cash, or other
2property in accordance with the terms of the domestication, and
3the shareholders of the domesticating corporation are entitled
4only to the rights provided to them by those terms and to any
5appraisal rights they may have under the organic law of the
6domesticating corporation.
   7f.  The domesticated corporation is all of the following:
   8(1)  Incorporated under and subject to the organic law of the
9domesticated corporation.
   10(2)  The same corporation without interruption as the
11domesticating corporation.
   12(3)  Deemed to have been incorporated on the date the
13domesticating corporation was originally incorporated.
   142.  When a domestication of a domestic corporation into
15a foreign jurisdiction becomes effective, the domesticated
16corporation is deemed to have done all of the following:
   17a.  Appointed the secretary of state as its agent for
18service of process in a proceeding to enforce the rights of
19shareholders who exercise appraisal rights in connection with
20the domestication.
   21b.  Agreed that it will promptly pay the amount, if any, to
22which such shareholders are entitled under subchapter XIII.
   233.  Except as otherwise provided in the organic law or
24organic rules of a domesticating foreign corporation, the
25interest holder liability of a shareholder in a foreign
26corporation that is domesticated into this state who had
27interest holder liability in respect of such domesticating
28corporation before the domestication becomes effective shall
29be as follows:
   30a.  The domestication does not discharge that prior
31interest holder liability with respect to any interest holder
32liabilities that arose before the domestication becomes
33effective.
   34b.  The provisions of the organic law of the domesticating
35corporation shall continue to apply to the collection or
-141-1discharge of any interest holder liabilities preserved by
2paragraph “a”, as if the domestication had not occurred.
   3c.  The shareholder shall have such rights of contribution
4from other persons as are provided by the organic law of the
5domesticating corporation with respect to any interest holder
6liabilities preserved by paragraph “a”, as if the domestication
7had not occurred.
   8d.  The shareholder shall not, by reason of such prior
9interest holder liability, have interest holder liability with
10respect to any interest holder liabilities that are incurred
11after the domestication becomes effective.
   124.  A shareholder who becomes subject to interest holder
13liability in respect of the domesticated corporation as a
14result of the domestication shall have such interest holder
15liability only in respect of interest holder liabilities that
16arise after the domestication becomes effective.
   175.  A domestication does not constitute or cause the
18dissolution of the domesticating corporation.
   196.  Property held for charitable purposes under the
20laws of this state by a domestic or foreign corporation
21immediately before a domestication shall not, as a result of
22the transaction, be diverted from the objects for which it was
23donated, granted, devised, or otherwise transferred except
24and to the extent permitted by or pursuant to the laws of
25this state addressing cy pres or dealing with nondiversion of
26charitable assets.
   277.  A bequest, devise, gift, grant, or promise contained
28in a will or other instrument of donation, subscription, or
29conveyance which is made to the domesticating corporation and
30which takes effect or remains payable after the domestication
31inures to the domesticated corporation.
   328.  A trust obligation that would govern property if
33transferred to the domesticating corporation applies to
34property that is transferred to the domesticated corporation
35after the domestication takes effect.
-142-1   Sec. 134.  NEW SECTION.  490.930  Conversion.
   21.  By complying with this subchapter, a domestic
3corporation may become any of the following:
   4a.  A domestic eligible entity.
   5b.  A foreign eligible entity if the conversion is permitted
6by the organic law of the foreign entity.
   72.  By complying with this part and applicable provisions
8of its organic law, a domestic eligible entity may become a
9domestic corporation. If procedures for the approval of a
10conversion are not provided by the organic law or organic rules
11of a domestic eligible entity, the conversion shall be adopted
12and approved in the same manner as a merger of that eligible
13entity. If the organic law or organic rules of a domestic
14eligible entity do not provide procedures for the approval
15of either a conversion or a merger, a plan of conversion may
16nonetheless be adopted and approved by the unanimous consent
17of all the interest holders of such eligible entity. In
18either such case, the conversion thereafter may be effected as
19provided in the other provisions of this part; and for purposes
20of applying this subchapter in such a case all of the following
21apply:
   22a.  The eligible entity, its members or interest holders,
23eligible interests and organic rules taken together, shall be
24deemed to be a domestic business corporation, shareholders,
25shares and articles of incorporation, respectively and vice
26versa, as the context may require.
   27b.  If the business and affairs of the eligible entity are
28managed by a person or persons that are not identical to the
29members or interest holders, that person or persons shall be
30deemed to be the board of directors.
   313.  By complying with the provisions of this part applicable
32to foreign entities, a foreign eligible entity may become a
33domestic corporation if the organic law of the foreign eligible
34entity permits it to become a business corporation in another
35jurisdiction.
-143-   14.  If a protected agreement of a domestic converting
2corporation in effect immediately before the conversion becomes
3effective contains a provision applying to a merger of the
4corporation that is a converting entity and the agreement does
5not refer to a conversion of the corporation, the provision
6applies to a conversion of the corporation as if the conversion
7were a merger, until such time as the provision is first
8amended after the enactment date.
9   Sec. 135.  NEW SECTION.  490.931  Plan of conversion.
   101.  A domestic corporation may convert to a domestic or
11foreign eligible entity under this part by approving a plan of
12conversion. The plan of conversion must include all of the
13following:
   14a.  The name of the converting corporation.
   15b.  The name, jurisdiction of formation, and type of entity
16of the converted entity.
   17c.  The manner and basis of converting the shares of
18the domestic corporation into eligible interests or other
19securities, obligations, rights to acquire eligible interests
20or other securities, cash, other property, or any combination
21of the foregoing.
   22d.  The other terms and conditions of the conversion.
   23e.  The full text, as it will be in effect immediately after
24the conversion becomes effective, of the organic rules of the
25converted entity which are to be in writing.
   262.  In addition to the requirements of subsection 1, a plan
27of conversion may contain any other provision not prohibited
28by law.
   293.  The terms of a plan of conversion may be made dependent
30upon facts objectively ascertainable outside the plan in
31accordance with section 490.120, subsection 11.
32   Sec. 136.  NEW SECTION.  490.932  Action on a plan of
33conversion.
   34In the case of a conversion of a domestic corporation to a
35domestic or foreign eligible entity, the plan of conversion
-144-1shall be adopted in the following manner:
   21.  The plan of conversion shall first be adopted by the
3board of directors.
   42.  a.  The plan of conversion shall then be approved by
5the shareholders. In submitting the plan of conversion to the
6shareholders for their approval, the board of directors must
7recommend that the shareholders approve the plan, unless any of
8the following applies:
   9(1)  The board of directors makes a determination that
10because of conflicts of interest or other special circumstances
11it should not make such a recommendation.
   12(2)  Section 490.826 applies.
   13b.  If paragraph “a”, subparagraph (1) or (2) applies, the
14board of directors shall inform the shareholders of the basis
15for its so proceeding.
   163.  The board of directors may set conditions for approval of
17the plan of conversion by the shareholders or the effectiveness
18of the plan of conversion.
   194.  If the approval of the shareholders is to be given at
20a meeting, the corporation shall notify each shareholder,
21regardless of whether entitled to vote, of the meeting of
22shareholders at which the plan of conversion is to be submitted
23for approval. The notice must state that the purpose, or one
24of the purposes, of the meeting is to consider the plan of
25conversion and must contain or be accompanied by a copy or
26summary of the plan. The notice must include or be accompanied
27by a copy of the organic rules of the converted entity which
28are to be in writing as they will be in effect immediately
29after the conversion.
   305.  Unless the articles of incorporation, bylaws, or the
31board of directors acting pursuant to subsection 3, require
32a greater vote or a greater quorum, approval of the plan of
33conversion requires all of the following:
   34a.  The approval of the shareholders at a meeting at which a
35quorum exists consisting of a majority of the votes entitled
-145-1to be cast on the plan.
   2b.  Except as provided in subsection 6, the approval of
3each class or series of shares voting as a separate voting
4group at a meeting at which a quorum of the voting group exists
5consisting of a majority of the votes entitled to be cast on
6the plan by that voting group.
   76.  If as a result of the conversion one or more shareholders
8of the converting domestic corporation would become subject to
9interest holder liability, approval of the plan of conversion
10shall require the signing in connection with the transaction,
11by each such shareholder, of a separate written consent to
12become subject to such interest holder liability.
13   Sec. 137.  NEW SECTION.  490.933  Articles of conversion —
14effectiveness.
   151.  Articles of conversion shall be signed by the converting
16entity after either a plan of conversion of a domestic
17corporation has been adopted and approved as required by this
18chapter or a domestic or foreign eligible entity that is the
19converting entity has approved a conversion as required under
20its organic law. The articles of conversion must do all of the
21following:
   22a.  State the name, jurisdiction of formation, and type of
23entity of the converting entity.
   24b.  State the name, jurisdiction of formation, and type of
25entity of the converted entity.
   26c.  (1)  If the converting entity is a domestic corporation,
27state that the plan of conversion was approved in accordance
28with this part.
   29(2)  If the converting entity is an eligible entity, state
30that the conversion was approved by the eligible entity in
31accordance with its organic law.
   32(3)  If the converting entity is a domestic eligible entity
33the organic law of which does not provide for approval of the
34conversion, state that the conversion was approved by the
35domestic eligible entity in accordance with this part.
-146-   1d.  (1)  If the converted entity is a domestic business
2corporation, or a domestic nonprofit corporation or filing
3entity, have attached the public organic record of the
4converted entity, except that provisions that would not be
5required to be included in a restated public organic record may
6be omitted.
   7(2)  If the converted entity is a domestic limited liability
8partnership, have attached the filing required to become a
9limited liability partnership.
   102.  If the converted entity is a domestic corporation,
11its articles of incorporation must satisfy the requirements
12of section 490.202, except that provisions that would not be
13required to be included in restated articles of incorporation
14may be omitted from the articles of incorporation. If the
15converted entity is a domestic eligible entity, its public
16organic record, if any, must satisfy the requirements of the
17organic law of this state, except that the public organic
18record does not need to be signed.
   193.  The articles of conversion shall be delivered to the
20secretary of state for filing, and shall take effect at the
21effective date determined in accordance with section 490.123.
   224.  If a converted entity is a domestic entity, the
23conversion becomes effective when the articles of conversion
24are effective. With respect to a conversion in which the
25converted entity is a foreign eligible entity, the conversion
26itself shall become effective at the later of the following:
   27a.  The date and time provided by the organic law of that
28eligible entity.
   29b.  When the articles of conversion become effective.
   305.  Articles of conversion under this section may be combined
31with any required conversion filing under the organic law
32of a domestic eligible entity that is the converting entity
33or converted entity if the combined filing satisfies the
34requirements of both this section and the other organic law.
   356.  If the converting entity is a foreign eligible entity
-147-1that is registered to do business in this state under a
2provision of law similar to subchapter XV, its registration
3statement or other type of foreign qualification shall be
4canceled automatically on the effective date of its conversion.
5   Sec. 138.  NEW SECTION.  490.934  Amendment of plan of
6conversion — abandonment.
   71.  A plan of conversion of a converting entity that is a
8domestic corporation may be amended in any of the following
9manners:
   10a.  In the same manner as the plan was approved, if the plan
11does not provide for the manner in which it may be amended.
   12b.  In the manner provided in the plan, except that
13shareholders that were entitled to vote on or consent to
14approval of the plan are entitled to vote on or consent to any
15amendment of the plan that will change any of the following:
   16(1)  The amount or kind of eligible interests or other
17securities, obligations, rights to acquire eligible interests
18or other securities, cash, other property, or any combination
19of the foregoing, to be received by any of the shareholders of
20the converting corporation under the plan.
   21(2)  The organic rules of the converted entity that will be
22in effect immediately after the conversion becomes effective,
23except for changes that do not require approval of the eligible
24interest holders of the converted entity under its organic law
25or organic rules.
   26(3)  Any other terms or conditions of the plan, if the
27change would adversely affect such shareholders in any material
28respect.
   292.  After a plan of conversion has been approved by a
30converting entity that is a domestic corporation in the manner
31required by this part and before the articles of conversion
32become effective, the plan may be abandoned by the corporation
33without action by its shareholders in accordance with any
34procedures set forth in the plan or, if no such procedures are
35set forth in the plan, in the manner determined by the board of
-148-1directors.
   23.  If a conversion is abandoned after the articles of
3conversion have been delivered to the secretary of state for
4filing and before the articles of conversion become effective,
5articles of abandonment, signed by the converting entity,
6must be delivered to the secretary of state for filing before
7the articles of conversion become effective. The articles
8of abandonment take effect on filing, and the conversion is
9abandoned and does not become effective. The articles of
10abandonment must contain all of the following:
   11a.  The name of the converting entity.
   12b.  The date on which the articles of conversion were filed
13by the secretary of state.
   14c.  A statement that the conversion has been abandoned in
15accordance with this section.
16   Sec. 139.  NEW SECTION.  490.935  Effect of conversion.
   171.  When a conversion becomes effective all of the following
18shall apply:
   19a.  All property owned by, and every contract right possessed
20by, the converting entity remain the property and contract
21rights of the converted entity without transfer, reversion, or
22impairment.
   23b.  All debts, obligations, and other liabilities of the
24converting entity remain the debts, obligations, and other
25liabilities of the converted entity.
   26c.  The name of the converted entity may but need not be
27substituted for the name of the converting entity in any
28pending action or proceeding.
   29d.  If the converted entity is a filing entity or a domestic
30business corporation or a domestic or foreign nonprofit
31corporation, its public organic record and its private organic
32rules become effective.
   33e.  If the converted entity is a nonfiling entity, its
34private organic rules become effective.
   35f.  If the converted entity is a limited liability
-149-1partnership, the filing required to become a limited liability
2partnership and its private organic rules become effective.
   3g.  The shares or eligible interests of the converting
4entity are reclassified into shares, eligible interests or
5other securities, obligations, rights to acquire shares,
6eligible interests or other securities, cash, or other property
7in accordance with the terms of the conversion, and the
8shareholders or interest holders of the converting entity are
9entitled only to the rights provided to them by those terms and
10to any appraisal rights they may have under the organic law of
11the converting entity.
   12h.  The converted entity is all of the following:
   13(1)  Incorporated or organized under and subject to the
14organic law of the converted entity.
   15(2)  The same entity without interruption as the converting
16entity.
   17(3)  Deemed to have been incorporated or otherwise
18organized on the date that the converting entity was originally
19incorporated or organized.
   202.  When a conversion of a domestic corporation to a foreign
21eligible entity becomes effective, the converted entity is
22deemed to have done all of the following:
   23a.  Appointed the secretary of state as its agent for
24service of process in a proceeding to enforce the rights of
25shareholders who exercise appraisal rights in connection with
26the conversion.
   27b.  Agreed that it will promptly pay the amount, if any, to
28which such shareholders are entitled under subchapter XIII.
   293.  Except as otherwise provided in the articles of
30incorporation of a domestic corporation or the organic law or
31organic rules of a foreign corporation or a domestic or foreign
32eligible entity, a shareholder or eligible interest holder who
33becomes subject to interest holder liability in respect of a
34domestic corporation or eligible entity as a result of the
35conversion shall have such interest holder liability only in
-150-1respect of interest holder liabilities that arise after the
2conversion becomes effective.
   34.  Except as otherwise provided in the organic law or the
4organic rules of the eligible entity, the interest holder
5liability of an interest holder in a converting eligible entity
6that converts to a domestic corporation who had interest holder
7liability in respect of such converting eligible entity before
8the conversion becomes effective shall be as follows:
   9a.  The conversion does not discharge that prior interest
10holder liability with respect to any interest holder
11liabilities that arose before the conversion became effective.
   12b.  The provisions of the organic law of the eligible entity
13shall continue to apply to the collection or discharge of any
14interest holder liabilities preserved by paragraph “a”, as if
15the conversion had not occurred.
   16c.  The eligible interest holder shall have such rights of
17contribution from other persons as are provided by the organic
18law of the eligible entity with respect to any interest holder
19liabilities preserved by paragraph “a”, as if the conversion had
20not occurred.
   21d.  The eligible interest holder shall not, by reason of such
22prior interest holder liability, have interest holder liability
23with respect to any interest holder liabilities that arise
24after the conversion becomes effective.
   255.  A conversion does not require the converting entity
26to wind up its affairs and does not constitute or cause the
27dissolution or termination of the entity.
   286.  Property held for charitable purposes under the laws of
29this state by a corporation or a domestic or foreign eligible
30entity immediately before a conversion shall not, as a result
31of the transaction, be diverted from the objects for which it
32was donated, granted, devised, or otherwise transferred except
33and to the extent permitted by or pursuant to the laws of
34this state addressing cy pres or dealing with nondiversion of
35charitable assets.
-151-   17.  A bequest, devise, gift, grant, or promise contained
2in a will or other instrument of donation, subscription, or
3conveyance which is made to the converting entity and which
4takes effect or remains payable after the conversion inures to
5the converted entity.
   68.  A trust obligation that would govern property if
7transferred to the converting entity applies to property that
8is transferred to the converted entity after the conversion
9takes effect.
10   Sec. 140.  Section 490.1003, Code 2020, is amended by
11striking the section and inserting in lieu thereof the
12following:
   13490.1003  Amendment by board of directors and shareholders.
   14If a corporation has issued shares, an amendment to the
15articles of incorporation shall be adopted in the following
16manner:
   171.  The proposed amendment shall first be adopted by the
18board of directors.
   192.  a.  Except as provided in sections 490.1005, 490.1007,
20and 490.1008, the amendment shall then be approved by the
21shareholders. In submitting the proposed amendment to the
22shareholders for approval, the board of directors shall
23recommend that the shareholders approve the amendment, unless
24any of the following applies:
   25(1)  The board of directors makes a determination that
26because of conflicts of interest or other special circumstances
27it should not make such a recommendation.
   28(2)  Section 490.826 applies.
   29b.  If paragraph “a”, subparagraph (1) or (2) applies, the
30board must inform the shareholders of the basis for its so
31proceeding.
   323.  The board of directors may set conditions for the
33approval of the amendment by the shareholders or the
34effectiveness of the amendment.
   354.  If the amendment is required to be approved by the
-152-1shareholders, and the approval is to be given at a meeting,
2the corporation shall notify each shareholder, regardless of
3whether entitled to vote, of the meeting of shareholders at
4which the amendment is to be submitted for approval. The
5notice must state that the purpose, or one of the purposes,
6of the meeting is to consider the amendment. The notice must
7contain or be accompanied by a copy of the amendment.
   85.  Unless the articles of incorporation or bylaws, or the
9board of directors acting pursuant to subsection 3, require a
10greater vote or a greater quorum, approval of the amendment
11requires the approval of the shareholders at a meeting at which
12a quorum consisting of a majority of the votes entitled to
13be cast on the amendment exists, and, if any class or series
14of shares is entitled to vote as a separate group on the
15amendment, except as provided in section 490.1004, subsection
163, the approval of each such separate voting group at a meeting
17at which a quorum of the voting group exists consisting of a
18majority of the votes entitled to be cast on the amendment by
19that voting group.
   206.  a.  If as a result of an amendment of the articles
21of incorporation one or more shareholders of a domestic
22corporation would become subject to new interest holder
23liability, approval of the amendment requires the signing in
24connection with the amendment, by each such shareholder, of a
25separate written consent to become subject to such new interest
26holder liability.
   27b.  Paragraph “a” does not apply in the case of a shareholder
28that already has interest holder liability and the terms and
29conditions of the new interest holder liability are any of the
30following:
   31(1)  Substantially identical to those of the existing
32interest holder liability.
   33(2)  Substantially identical to those of the existing
34interest holder liability, other than changes that eliminate or
35reduce such interest holder liability.
-153-   17.  As used in subsection 6 and section 490.1009, “new
2interest holder liability” means interest holder liability
3of a person resulting from an amendment of the articles of
4incorporation if any of the following applies:
   5a.  The person did not have interest holder liability before
6the amendment becomes effective.
   7b.  The person had interest holder liability before the
8amendment becomes effective, the terms and conditions of which
9are changed when the amendment becomes effective.
10   Sec. 141.  Section 490.1004, Code 2020, is amended by
11striking the section and inserting in lieu thereof the
12following:
   13490.1004  Voting on amendments by voting groups.
   141.  The holders of the outstanding shares of a class are
15entitled to vote as a separate voting group, if shareholder
16voting is otherwise required by this chapter, on a proposed
17amendment to the articles of incorporation if the amendment
18would do any of the following:
   19a.  Effect an exchange or reclassification of all or part of
20the shares of the class into shares of another class.
   21b.  Effect an exchange or reclassification, or create the
22right of exchange, of all or part of the shares of another
23class into shares of the class.
   24c.  Change the rights, preferences, or limitations of all or
25part of the shares of the class.
   26d.  Change the shares of all or part of the class into a
27different number of shares of the same class.
   28e.  Create a new class of shares having rights or preferences
29with respect to distributions that are prior or superior to the
30shares of the class.
   31f.  Increase the rights, preferences, or number of authorized
32shares of any class that, after giving effect to the amendment,
33have rights or preferences with respect to distributions that
34are prior or superior to the shares of the class.
   35g.  Limit or deny an existing preemptive right of all or part
-154-1of the shares of the class.
   2h.  Cancel or otherwise affect rights to distributions that
3have accumulated but not yet been authorized on all or part of
4the shares of the class.
   52.  If a proposed amendment would affect a series of a class
6of shares in one or more of the ways described in subsection 1,
7the holders of shares of that series are entitled to vote as a
8separate voting group on the proposed amendment.
   93.  If a proposed amendment that entitles the holders of
10two or more classes or series of shares to vote as separate
11voting groups under this section would affect those two or more
12classes or series in the same or a substantially similar way,
13the holders of shares of all the classes or series so affected
14shall vote together as a single voting group on the proposed
15amendment, unless otherwise provided in the articles of
16incorporation or added as a condition by the board of directors
17pursuant to section 490.1003, subsection 3.
   184.  A class or series of shares is entitled to the voting
19rights granted by this section even if the articles of
20incorporation provide that the shares are nonvoting shares.
21   Sec. 142.  Section 490.1006, Code 2020, is amended by
22striking the section and inserting in lieu thereof the
23following:
   24490.1006  Articles of amendment.
   251.  After an amendment to the articles of incorporation
26has been adopted and approved in the manner required by this
27chapter and by the articles of incorporation, the corporation
28shall deliver to the secretary of state, for filing, articles
29of amendment, which must set forth all of the following:
   30a.  The name of the corporation.
   31b.  The text of each amendment adopted, or the information
32required by section 490.120, subsection 11, paragraph “e”.
   33c.  If an amendment provides for an exchange,
34reclassification, or cancellation of issued shares,
35provisions for implementing the amendment, if not contained in
-155-1the amendment itself, which may be made dependent upon facts
2objectively ascertainable outside the articles of amendment in
3accordance with section 490.120, subsection 11, paragraph “e”.
   4d.  The date of each amendment’s adoption.
   5e.  For an amendment, the following:
   6(1)  If it was adopted by the incorporators or board of
7directors without shareholder approval, a statement that the
8amendment was duly adopted by the incorporators or by the board
9of directors, as the case may be, and that shareholder approval
10was not required.
   11(2)  If it required approval by the shareholders, a statement
12that the amendment was duly approved by the shareholders in
13the manner required by this chapter and by the articles of
14incorporation.
   15(3)  If being filed pursuant to section 490.120, subsection
1611, paragraph “e”, a statement to that effect.
   172.  Articles of amendment shall take effect at the effective
18date determined in accordance with section 490.123.
19   Sec. 143.  Section 490.1007, Code 2020, is amended by
20striking the section and inserting in lieu thereof the
21following:
   22490.1007  Restated articles of incorporation.
   231.  A corporation’s board of directors may restate its
24articles of incorporation at any time, without shareholder
25approval, to consolidate all amendments into a single document.
   262.  If the restated articles include one or more new
27amendments that require shareholder approval, the amendments
28shall be adopted and approved as provided in section 490.1003.
   293.  A corporation that restates its articles of
30incorporation shall deliver to the secretary of state for
31filing articles of restatement setting forth all of the
32following:
   33a.  The name of the corporation.
   34b.  The text of the restated articles of incorporation.
   35c.  A statement that the restated articles consolidate all
-156-1amendments into a single document.
   2d.  If a new amendment is included in the restated articles,
3the statements required under section 490.1006 with respect to
4the new amendment.
   54.  Duly adopted restated articles of incorporation
6supersede the original articles of incorporation and all
7amendments to the articles of incorporation.
   85.  The secretary of state may certify restated articles of
9incorporation as the articles of incorporation currently in
10effect, without including the statements required by subsection
113, paragraph “d”.
12   Sec. 144.  Section 490.1009, Code 2020, is amended by
13striking the section and inserting in lieu thereof the
14following:
   15490.1009  Effect of amendment.
   161.  An amendment to the articles of incorporation does not
17affect a cause of action existing against or in favor of the
18corporation, a proceeding to which the corporation is a party,
19or the existing rights of persons other than the shareholders.
20An amendment changing a corporation’s name does not affect a
21proceeding brought by or against the corporation in its former
22name.
   232.  A shareholder who becomes subject to new interest holder
24liability in respect of the corporation as a result of an
25amendment to the articles of incorporation shall have that new
26interest holder liability only in respect of interest holder
27liabilities that arise after the amendment becomes effective.
   283.  Except as otherwise provided in the articles of
29incorporation of the corporation, the interest holder liability
30of a shareholder who had interest holder liability in respect
31of the corporation before the amendment becomes effective and
32has new interest holder liability after the amendment becomes
33effective shall be as follows:
   34a.  The amendment does not discharge that prior interest
35holder liability with respect to any interest holder
-157-1liabilities that arose before the amendment becomes effective.
   2b.  The provisions of the articles of incorporation of
3the corporation relating to interest holder liability as in
4effect immediately prior to the amendment shall continue to
5apply to the collection or discharge of any interest holder
6liabilities preserved by paragraph “a”, as if the amendment had
7not occurred.
   8c.  The shareholder shall have such rights of contribution
9from other persons as are provided by the articles of
10incorporation relating to interest holder liability as in
11effect immediately prior to the amendment with respect to any
12interest holder liabilities preserved by paragraph “a”, as if
13the amendment had not occurred.
   14d.  The shareholder shall not, by reason of such prior
15interest holder liability, have interest holder liability with
16respect to any interest holder liabilities that arise after the
17amendment becomes effective.
18   Sec. 145.  Section 490.1020, Code 2020, is amended by
19striking the section and inserting in lieu thereof the
20following:
   21490.1020  Authority to amend.
   221.  A corporation’s shareholders may amend or repeal the
23corporation’s bylaws.
   242.  A corporation’s board of directors may amend or repeal
25the corporation’s bylaws unless any of the following apply:
   26a.  The articles of incorporation, section 490.1021, or, if
27applicable, section 490.1022, reserve that power exclusively to
28the shareholders in whole or part.
   29b.  Except as provided in section 490.206, subsection 4,
30the shareholders in amending, repealing, or adopting a bylaw
31expressly provide that the board of directors shall not amend,
32repeal, or adopt that bylaw.
   333.  A shareholder of the corporation does not have a vested
34property right resulting from any provision in the bylaws.
35   Sec. 146.  Section 490.1021, Code 2020, is amended by
-158-1striking the section and inserting in lieu thereof the
2following:
   3490.1021  Bylaw increasing quorum or voting requirement for
4directors.
   51.  A bylaw that increases a quorum or voting requirement
6for the board of directors or that requires a meeting of
7shareholders to be held at a place may be amended or repealed
8as follows:
   9a.  If originally adopted by the shareholders, only by the
10shareholders, unless the bylaw otherwise provides.
   11b.  If adopted by the board of directors, either by the
12shareholders or by the board of directors.
   132.  A bylaw adopted or amended by the shareholders that
14increases a quorum or voting requirement for the board of
15directors may provide that it can be amended or repealed only
16by a specified vote of either the shareholders or the board of
17directors.
   183.  Action by the board of directors under subsection 1
19to amend or repeal a bylaw that changes a quorum or voting
20requirement for the board of directors shall meet the same
21quorum requirement and be adopted by the same vote required to
22take action under the quorum and voting requirement then in
23effect or proposed to be adopted, whichever is greater.
24   Sec. 147.  NEW SECTION.  490.1022  Bylaw provisions relating
25to the election of directors.
   261.  Unless the articles of incorporation specifically
27prohibit the adoption of a bylaw pursuant to this section,
28alter the vote specified in section 490.728, subsection 1, or
29provide for cumulative voting, a corporation may elect in its
30bylaws to be governed in the election of directors as follows:
   31a.  Each vote entitled to be cast may be voted for or against
32up to that number of candidates that is equal to the number
33of directors to be elected, or a shareholder may indicate an
34abstention, but without cumulating the votes.
   35b.  To be elected, a nominee shall have received a plurality
-159-1of the votes cast by holders of shares entitled to vote
2in the election at a meeting at which a quorum is present,
3provided that a nominee who is elected but receives more votes
4against than for election shall serve as a director for a term
5that shall terminate on the date that is the earlier of the
6following:
   7(1)  (a)  Ninety days from the date on which the voting
8results are determined pursuant to section 490.729, subsection
92, paragraph “e”.
   10(b)  The date on which an individual is selected by the
11board of directors to fill the office held by such director,
12which selection shall be deemed to constitute the filling of a
13vacancy by the board to which section 490.810 applies.
   14(2)  Subject to subsection 1, paragraph “c”, a nominee who is
15elected but receives more votes against than for election shall
16not serve as a director beyond the ninety-day period provided
17in subparagraph division (a).
   18c.  The board of directors may select any qualified
19individual to fill the office held by a director who received
20more votes against than for election.
   212.  a.  Subsection 1 does not apply to an election of
22directors by a voting group if any of the fo1lowing applies:
   23(1)  At the expiration of the time fixed under a provision
24requiring advance notification of director candidates.
   25(2)  Absent such a provision, at a time fixed by the board of
26directors which is not more than fourteen days before notice
27is given of the meeting at which the election is to occur,
28there are more candidates for election by the voting group than
29the number of directors to be elected, one or more of whom are
30properly proposed by shareholders.
   31b.  An individual shall not be considered a candidate for
32purposes of paragraph “a”, if the board of directors determines
33before the notice of meeting is given that such individual’s
34candidacy does not create a bona fide election contest.
   353.  A bylaw electing to be governed by this section may be
-160-1repealed under any of the following circumstances:
   2a.  If originally adopted by the shareholders, only by the
3shareholders, unless the bylaw otherwise provides.
   4b.  If adopted by the board of directors, by the board of
5directors or the shareholders.
6   Sec. 148.  Section 490.1101, Code 2020, is amended by
7striking the section and inserting in lieu thereof the
8following:
   9490.1101  Subchapter definitions.
   10As used in this subchapter:
   111.  “Acquired entity” means the domestic or foreign
12corporation or eligible entity that will have all of one or
13more classes or series of its shares or eligible interests
14acquired in a share exchange.
   152.  “Acquiring entity” means the domestic or foreign
16corporation or eligible entity that will acquire all of one or
17more classes or series of shares or eligible interests of the
18acquired entity in a share exchange.
   193.  “New interest holder liability” means interest holder
20liability of a person, resulting from a merger or share
21exchange, that is any of the following:
   22a.  In respect of an entity which is different from the
23entity in which the person held shares or eligible interests
24immediately before the merger or share exchange became
25effective.
   26b.  In respect of the same entity as the one in which the
27person held shares or eligible interests immediately before
28the merger or share exchange became effective if any of the
29following apply:
   30(1)  The person did not have interest holder liability
31immediately before the merger or share exchange became
32effective.
   33(2)  The person had interest holder liability immediately
34before the merger or share exchange became effective, the terms
35and conditions of which were changed when the merger or share
-161-1exchange became effective.
   24.  “Party to a merger” means any domestic or foreign
3corporation or eligible entity that will merge under a plan of
4merger but does not include a survivor created by the merger.
   55.  “Survivor” in a merger means the domestic or foreign
6corporation or eligible entity into which one or more other
7corporations or eligible entities are merged.
8   Sec. 149.  Section 490.1102, Code 2020, is amended by
9striking the section and inserting in lieu thereof the
10following:
   11490.1102  Merger.
   121.  By complying with this subchapter, all of the following
13apply:
   14a.  One or more domestic business corporations may merge
15with one or more domestic or foreign business corporations or
16eligible entities pursuant to a plan of merger, resulting in
17a survivor.
   18b.  Two or more foreign business corporations or domestic or
19foreign eligible entities may merge, resulting in a survivor
20that is a domestic business corporation created in the merger.
   212.  By complying with the provisions of this subchapter
22applicable to foreign entities, a foreign business corporation
23or a foreign eligible entity may be a party to a merger with
24a domestic business corporation, or may be created as the
25survivor in a merger in which a domestic business corporation
26is a party, but only if the merger is permitted by the organic
27law of the foreign business corporation or eligible entity.
   283.  If the organic law or organic rules of a domestic
29eligible entity do not provide procedures for the approval
30of a merger, a plan of merger may nonetheless be adopted
31and approved by the unanimous consent of all of the interest
32holders of such eligible entity, and the merger may thereafter
33by effected as provided in the other provisions of this
34subchapter; and for the purposes of applying this subchapter in
35such a case all of the following shall apply:
-162-   1a.  The eligible entity, its members or interest holders,
2eligible interests and articles of incorporation or other
3organic rules taken together shall be deemed to be a domestic
4business corporation, shareholders, shares and articles of
5incorporation, respectively and vice versa as the context may
6require.
   7b.  If the business and affairs of the eligible entity are
8managed by a person or persons that are not identical to the
9members or interest holders, that group shall be deemed to be
10the board of directors.
   114.  The plan of merger must include all of the following:
   12a.  As to each party to the merger, its name, jurisdiction of
13formation, and type of entity.
   14b.  The survivor’s name, jurisdiction of formation, and type
15of entity, and, if the survivor is to be created in the merger,
16a statement to that effect.
   17c.  The terms and conditions of the merger.
   18d.  The manner and basis of converting the shares of
19each merging domestic or foreign business corporation and
20eligible interests of each merging domestic or foreign eligible
21entity into shares or other securities, eligible interests,
22obligations, rights to acquire shares, other securities or
23eligible interests, cash, other property, or any combination
24of the foregoing.
   25e.  The articles of incorporation of any domestic or foreign
26business or nonprofit corporation, or the public organic
27record of any domestic or foreign unincorporated entity, to be
28created by the merger, or if a new domestic or foreign business
29or nonprofit corporation or unincorporated entity is not to
30be created by the merger, any amendments to the survivor’s
31articles of incorporation or other public organic record.
   32f.  Any other provisions required by the laws under which any
33party to the merger is organized or by which it is governed, or
34by the articles of incorporation or organic rules of any such
35party.
-163-   15.  In addition to the requirements of subsection 4, a plan
2of merger may contain any other provision not prohibited by
3law.
   46.  Terms of a plan of merger may be made dependent on facts
5objectively ascertainable outside the plan in accordance with
6section 490.120, subsection 11.
   77.  A plan of merger may be amended only with the consent of
8each party to the merger, except as provided in the plan. A
9domestic party to a merger may approve an amendment to a plan
10in any of the following manners:
   11a.  In the same manner as the plan was approved, if the plan
12does not provide for the manner in which it may be amended.
   13b.  In the manner provided in the plan, except that
14shareholders, members, or interest holders that were entitled
15to vote on or consent to approval of the plan are entitled
16to vote on or consent to any amendment of the plan that will
17change any of the following:
   18(1)  The amount or kind of shares or other securities,
19eligible interests, obligations, rights to acquire shares,
20other securities or eligible interests, cash, or other property
21to be received under the plan by the shareholders, members, or
22interest holders of any party to the merger.
   23(2)  The articles of incorporation of any domestic or foreign
24business or nonprofit corporation, or the organic rules of
25any unincorporated entity, that will be the survivor of the
26merger, except for changes permitted by section 490.1005 or by
27comparable provisions of the organic law of any such foreign
28corporation or domestic or foreign nonprofit corporation or
29unincorporated entity.
   30(3)  Any of the other terms or conditions of the plan if the
31change would adversely affect such shareholders, members, or
32interest holders in any material respect.
33   Sec. 150.  Section 490.1103, Code 2020, is amended by
34striking the section and inserting in lieu thereof the
35following:
-164-   1490.1103  Share exchange.
   21.  By complying with this subchapter all of the following
3apply:
   4a.  A domestic corporation may acquire all of the shares of
5one or more classes or series of shares of another domestic or
6foreign corporation, or all of the eligible interests of one or
7more classes or series of interests of a domestic or foreign
8eligible entity, in exchange for shares or other securities,
9eligible interests, obligations, rights to acquire shares or
10other securities or eligible interests, cash, other property,
11or any combination of the foregoing, pursuant to a plan of
12share exchange.
   13b.  All of the shares of one or more classes or series of
14shares of a domestic corporation may be acquired by another
15domestic or foreign corporation or eligible entity, in
16exchange for shares or other securities, eligible interests,
17obligations, rights to acquire shares or other securities or
18eligible interests, cash, other property, or any combination of
19the foregoing, pursuant to a plan of share exchange.
   202.  A foreign corporation or eligible entity may be the
21acquired entity in a share exchange only if the share exchange
22is permitted by the organic law of that corporation or other
23entity.
   243.  If the organic law or organic rules of a domestic
25eligible entity do not provide procedures for the approval
26of a share exchange, a plan of share exchange may be adopted
27and approved, and the share exchange effected, in accordance
28with the procedures, if any, for a merger. If the organic
29law or organic rules of a domestic eligible entity do not
30provide procedures for the approval of either a share exchange
31or a merger, a plan of share exchange may nonetheless be
32adopted and approved by the unanimous consent of all of the
33interest holders of such eligible entity whose interests will
34be exchanged under the plan of share exchange, and the share
35exchange may thereafter be effected as provided in the other
-165-1provisions of this subchapter; and for purposes of applying
2this subchapter in such a case all of the following apply:
   3a.  The eligible entity, its interest holders, interests,
4and articles of incorporation or other organic rules taken
5together shall be deemed to be a domestic business corporation,
6shareholders, shares and articles of incorporation,
7respectively and vice versa as the context may require.
   8b.  If the business and affairs of the eligible entity are
9managed by a person or persons that are not identical to the
10members or interest holders, that person or those persons shall
11be deemed to be the board of directors.
   124.  The plan of share exchange must include all of the
13following:
   14a.  The name of each domestic or foreign corporation or other
15eligible entity the shares or eligible interests of which will
16be acquired and the name of the domestic or foreign corporation
17or eligible entity that will acquire those shares or eligible
18interests.
   19b.  The terms and conditions of the share exchange.
   20c.  The manner and basis of exchanging shares of a domestic
21or foreign corporation or eligible interests in a domestic or
22foreign eligible entity the shares or eligible interests of
23which will be acquired under the share exchange for shares or
24other securities, eligible interests, obligations, rights to
25acquire shares, other securities, or eligible interests, cash,
26other property, or any combination of the foregoing.
   27d.  Any other provisions required by the organic law
28governing the acquired entity or its articles of incorporation
29or organic rules.
   305.  The terms of a plan of share exchange may be made
31dependent on facts objectively ascertainable outside the plan
32in accordance with section 490.120, subsection 11.
   336.  A plan of share exchange may be amended only with the
34consent of each party to the share exchange, except as provided
35in the plan. A domestic entity may approve an amendment to a
-166-1plan in any of the following manners:
   2a.  In the same manner as the plan was approved, if the plan
3does not provide for the manner in which it may be amended.
   4b.  In the manner provided in the plan, except that
5shareholders, members, or interest holders that were entitled
6to vote on or consent to approval of the plan are entitled
7to vote on or consent to any amendment of the plan that will
8change any of the following:
   9(1)  The amount or kind of shares or other securities,
10eligible interests, obligations, rights to acquire shares,
11other securities or eligible interests, cash, or other property
12to be received under the plan by the shareholders, members, or
13interest holders of the acquired entity.
   14(2)  Any of the other terms or conditions of the plan if the
15change would adversely affect such shareholders, members, or
16interest holders in any material respect.
17   Sec. 151.  Section 490.1104, Code 2020, is amended by
18striking the section and inserting in lieu thereof the
19following:
   20490.1104  Action on a plan of merger or share exchange.
   21In the case of a domestic corporation that is a party to a
22merger or the acquired entity in a share exchange, the plan
23of merger or share exchange shall be adopted in the following
24manner:
   251.  The plan of merger or share exchange shall first be
26adopted by the board of directors.
   272.  a.  Except as provided in subsections 8, 10, and 12, and
28in section 490.1105, the plan of merger or share exchange shall
29then be approved by the shareholders. In submitting the plan
30of merger or share exchange to the shareholders for approval,
31the board of directors shall recommend that the shareholders
32approve the plan, or, in the case of an offer referred to in
33subsection 10, paragraph “b”, that the shareholders tender
34their shares to the offeror in response to the offer, unless
35any of the following apply:
-167-   1(1)  The board of directors makes a determination that
2because of conflicts of interest or other special circumstances
3it should not make such a recommendation.
   4(2)  Section 490.826 applies.
   5b.  If either paragraph “a”, subparagraph (1) or (2),
6applies, the board shall inform the shareholders of the basis
7for its so proceeding.
   83.  The board of directors may set conditions for the
9approval of the plan of merger or share exchange by the
10shareholders or the effectiveness of the plan of merger or
11share exchange.
   124.  If the plan of merger or share exchange is required
13to be approved by the shareholders, and if the approval is
14to be given at a meeting, the corporation shall notify each
15shareholder, regardless of whether entitled to vote, of the
16meeting of shareholders at which the plan is to be submitted
17for approval. The notice must state that the purpose, or one
18of the purposes, of the meeting is to consider the plan and
19must contain or be accompanied by a copy or summary of the
20plan. If the corporation is to be merged into an existing
21foreign or domestic corporation or eligible entity, the notice
22must also include or be accompanied by a copy or summary of the
23articles of incorporation and bylaws or the organic rules of
24that corporation or eligible entity. If the corporation is to
25be merged with a domestic or foreign corporation or eligible
26entity and a new domestic or foreign corporation or eligible
27entity is to be created pursuant to the merger, the notice
28must include or be accompanied by a copy or a summary of the
29articles of incorporation and bylaws or the organic rules of
30the new corporation or eligible entity.
   315.  Unless the articles of incorporation, bylaws, or the
32board of directors acting pursuant to subsection 3, require
33a greater vote or a greater quorum, approval of the plan
34of merger or share exchange requires the approval of the
35shareholders at a meeting at which a quorum exists consisting
-168-1of a majority of the votes entitled to be cast on the plan,
2and, if any class or series of shares is entitled to vote as
3a separate group on the plan of merger or share exchange, the
4approval of each such separate voting group at a meeting at
5which a quorum of the voting group is present consisting of
6a majority of the votes entitled to be cast on the merger or
7share exchange by that voting group.
   86.  Subject to subsection 7, separate voting by voting groups
9is required for each of the following:
   10a.  On a plan of merger, by each class or series of shares
11that are any of the following:
   12(1)  To be converted under the plan of merger into shares,
13other securities, eligible interests, obligations, rights to
14acquire shares, other securities or eligible interests, cash,
15other property, or any combination of the foregoing.
   16(2)  Entitled to vote as a separate group on a provision in
17the plan that constitutes a proposed amendment to the articles
18of incorporation of a surviving corporation that requires
19action by separate voting groups under section 490.1004.
   20b.  On a plan of share exchange, by each class or series
21of shares included in the exchange, with each class or series
22constituting a separate voting group.
   23c.  On a plan of merger or share exchange, if the voting
24group is entitled under the articles of incorporation to
25vote as a voting group to approve a plan of merger or share
26exchange, respectively.
   277.  The articles of incorporation may expressly limit or
28eliminate the separate voting rights provided in subsection 6,
29paragraph “a”, subparagraph (1), and subsection 6, paragraph
30“b”, as to any class or series of shares, except when all of the
31following apply:
   32a.  The plan of merger or share exchange includes what is
33or would be in effect an amendment subject to subsection 6,
34paragraph “a”, subparagraph (2).
   35b.  The plan of merger or share exchange will not effect a
-169-1substantive business combination.
   28.  Unless the articles of incorporation otherwise provide,
3approval by the corporation’s shareholders of a plan of
4merger is not required if all of the following conditions are
5satisfied:
   6a.  The corporation will survive the merger.
   7b.  Except for amendments permitted by section 490.1005, its
8articles of incorporation will not be changed.
   9c.  Each shareholder of the corporation whose shares were
10outstanding immediately before the effective date of the merger
11or share exchange will hold the same number of shares, with
12identical preferences, rights, and limitations, immediately
13after the effective date of the merger.
   14d.  The issuance in the merger of shares or other securities
15convertible into or rights exercisable for shares does not
16require a vote under section 490.621, subsection 6.
   179.  a.  If, as a result of a merger or share exchange, one
18or more shareholders of a domestic corporation would become
19subject to new interest holder liability, approval of the plan
20of merger or share exchange requires the signing in connection
21with the transaction, by each such shareholder, of a separate
22written consent to become subject to such new interest holder
23liability.
   24b.  Paragraph “a” does not apply in the case of a shareholder
25that already has interest holder liability with respect to such
26domestic corporation, if all of the following apply:
   27(1)  The new interest holder liability is with respect to
28a domestic or foreign corporation, which may be a different
29or the same domestic corporation in which the person is a
30shareholder.
   31(2)  The terms and conditions of the new interest holder
32liability are substantially identical to those of the existing
33interest holder liability, other than for changes that
34eliminate or reduce such interest holder liability.
   3510.  Unless the articles of incorporation otherwise provide,
-170-1approval by the shareholders of a plan of merger or share
2exchange is not required if all of the following apply:
   3a.  The plan of merger or share exchange expressly permits or
4requires the merger or share exchange to be effected under this
5subsection and provides that, if the merger or share exchange
6is to be effected under this subsection, the merger or share
7exchange will be effected as soon as practicable following the
8satisfaction of the requirement set forth in paragraph “f”.
   9b.  Another party to the merger, the acquiring entity in
10the share exchange, or a parent of another party to the merger
11or the acquiring entity in the share exchange, makes an offer
12to purchase, on the terms provided in the plan of merger or
13share exchange, any and all of the outstanding shares of the
14corporation that, absent this subsection, would be entitled to
15vote on the plan of merger or share exchange, except that the
16offer may exclude shares of the corporation that are owned at
17the commencement of the offer by the corporation, the offeror,
18or any parent of the offeror, or by any wholly owned subsidiary
19of any of the foregoing.
   20c.  The offer discloses that the plan of merger or share
21exchange provides that the merger or share exchange will be
22effected as soon as practicable following the satisfaction of
23the requirement set forth in paragraph “f” and that the shares
24of the corporation that are not tendered in response to the
25offer will be treated as set forth in paragraph “h”.
   26d.  The offer remains open for at least ten days.
   27e.  The offeror purchases all shares properly tendered in
28response to the offer and not properly withdrawn.
   29f.  The shares listed below are collectively entitled to cast
30at least the minimum number of votes on the merger or share
31exchange that, absent this subsection, would be required by
32this subchapter and by the articles of incorporation for the
33approval of the merger or share exchange by the shareholders
34and by any other voting group entitled to vote on the merger
35or share exchange at a meeting at which all shares entitled to
-171-1vote on the approval were present and voted:
   2(1)  Shares purchased by the offeror in accordance with the
3offer.
   4(2)  Shares otherwise owned by the offeror or by any parent
5of the offeror or any wholly owned subsidiary of any of the
6foregoing.
   7(3)  Shares subject to an agreement that they are to be
8transferred, contributed, or delivered to the offeror, any
9parent of the offeror, or any wholly owned subsidiary of any of
10the foregoing in exchange for shares or eligible interests in
11such offeror, parent, or subsidiary.
   12g.  The offeror or a wholly owned subsidiary of the offeror
13merges with or into, or effects a share exchange in which it
14acquires shares of, the corporation.
   15h.  Each outstanding share of each class or series of shares
16of the corporation that the offeror is offering to purchase
17in accordance with the offer, and that is not purchased in
18accordance with the offer, is to be converted in the merger
19into, or into the right to receive, or is to be exchanged
20in the share exchange for, or for the right to receive,
21the same amount and kind of securities, eligible interests,
22obligations, rights, cash, or other property to be paid or
23exchanged in accordance with the offer for each share of
24that class or series of shares that is tendered in response
25to the offer, except that shares of the corporation that are
26owned by the corporation or that are described in paragraph
27“f”, subparagraph (2) or (3), need not be converted into or
28exchanged for the consideration described in this paragraph
29“h”.
   3011.  As used in subsection 10:
   31a.  “Offer” means the offer referred to in subsection 10,
32paragraph “b”.
   33b.  “Offeror” means the person making the offer.
   34c.  “Parent” of an entity means a person that owns, directly
35or indirectly, through one or more wholly owned subsidiaries,
-172-1all of the outstanding shares of or eligible interests in that
2entity.
   3d.  Shares tendered in response to the offer shall be deemed
4to have been “purchased” in accordance with the offer at the
5earliest time as of which the following applies:
   6(1)  The offeror has irrevocably accepted those shares for
7payment.
   8(2)  Either of the following applies:
   9(a)  In the case of shares represented by certificates, the
10offeror, or the offeror’s designated depository or other agent,
11has physically received the certificates representing those
12shares.
   13(b)  In the case of shares without certificates, those shares
14have been transferred into the account of the offeror or its
15designated depository or other agent, or an agent’s message
16relating to those shares has been received by the offeror or
17its designated depository or other agent.
   18e.  “Wholly owned subsidiary” of a person means an entity of
19or in which that person owns, directly or indirectly, through
20one or more wholly owned subsidiaries, all of the outstanding
21shares or eligible interests.
   2212.  Unless the articles of incorporation otherwise provide,
23all of the following applies:
   24a.  Approval of a plan of share exchange by the shareholders
25of a domestic corporation is not required if the corporation is
26the acquiring entity in the share exchange.
   27b.  Shares not to be exchanged under the plan of share
28exchange are not entitled to vote on the plan.
29   Sec. 152.  Section 490.1105, Code 2020, is amended by
30striking the section and inserting in lieu thereof the
31following:
   32490.1105  Merger between parent and subsidiary or between
33subsidiaries.
   341.  A domestic or foreign parent entity that owns shares of
35a domestic corporation which carry at least ninety percent of
-173-1the voting power of each class and series of the outstanding
2shares of the subsidiary that has voting power may do any of
3the following:
   4a.  Merge the subsidiary into itself, if it is a domestic
5or foreign corporation or eligible entity, or into another
6domestic or foreign corporation or eligible entity in which the
7parent entity owns at least ninety percent of the voting power
8of each class and series of the outstanding shares or eligible
9interests which have voting power.
   10b.  Merge itself, if it is a domestic or foreign corporation
11or eligible entity, into such subsidiary, in either case
12without the approval of the board of directors or shareholders
13of the subsidiary, unless the articles of incorporation
14or organic rules of the parent entity or the articles of
15incorporation of the subsidiary corporation otherwise provide.
   16c.  Section 490.1104, subsection 9, applies to a merger under
17this section. The articles of merger relating to a merger
18under this section do not need to be signed by the subsidiary.
   192.  A parent entity shall, within ten days after the
20effective date of a merger approved under subsection 1, notify
21each of the subsidiary’s shareholders that the merger has
22become effective.
   233.  Except as provided in subsections 1 and 2, a merger
24between a parent entity and a domestic subsidiary corporation
25shall be governed by the provisions of this subchapter
26applicable to mergers generally.
27   Sec. 153.  Section 490.1106, Code 2020, is amended by
28striking the section and inserting in lieu thereof the
29following:
   30490.1106  Articles of merger or share exchange.
   311.  After a plan of merger has been adopted and approved as
32required by this chapter, or if the merger is being effected
33under section 490.1102, subsection 1, paragraph “b”, the merger
34has been approved as required by the organic law governing the
35parties to the merger, then articles of merger shall be signed
-174-1by each party to the merger except as provided in section
2490.1105, subsection 1. The articles must set forth all of the
3following:
   4a.  The name, jurisdiction of formation, and type of entity
5of each party to the merger.
   6b.  The name, jurisdiction of formation, and type of entity
7of the survivor.
   8c.  If the survivor of the merger is a domestic corporation
9and its articles of incorporation are amended, or if a new
10domestic corporation is created as a result of the merger, any
11of the following:
   12(1)  The amendments to the survivor’s articles of
13incorporation.
   14(2)  The articles of incorporation of the new corporation.
   15d.  If the survivor of the merger is a domestic eligible
16entity and its public organic record is amended, or if a new
17domestic eligible entity is created as a result of the merger,
18any of the following:
   19(1)  The amendments to the public organic record of the
20survivor.
   21(2)  The public organic record of the new eligible entity.
   22e.  If the plan of merger required approval by the
23shareholders of a domestic corporation that is a party to the
24merger, a statement that the plan was duly approved by the
25shareholders and, if voting by any separate voting group was
26required, by each such separate voting group, in the manner
27required by this chapter and the articles of incorporation.
   28f.  If the plan of merger or share exchange did not require
29approval by the shareholders of a domestic corporation that is
30a party to the merger, a statement to that effect.
   31g.  As to each foreign corporation that is a party to the
32merger, a statement that the participation of the foreign
33corporation was duly authorized as required by its organic law.
   34h.  As to each domestic or foreign eligible entity that is a
35party to the merger, a statement that the merger was approved
-175-1in accordance with its organic law or section 490.1102,
2subsection 3.
   3i.  If the survivor is created by the merger and is a
4domestic limited liability partnership, the filing required to
5become a limited liability partnership, as an attachment.
   62.  After a plan of share exchange in which the acquired
7entity is a domestic corporation or eligible entity has been
8adopted and approved as required by this chapter, articles
9of share exchange shall be signed by the acquired entity and
10the acquiring entity. The articles shall set forth all of the
11following:
   12a.  The name of the acquired entity.
   13b.  The name, jurisdiction of formation, and type of entity
14of the domestic or foreign corporation or eligible entity that
15is the acquiring entity.
   16c.  A statement that the plan of share exchange was duly
17approved by the acquired entity by all of the following:
   18(1)  The required vote or consent of each class or series of
19shares or eligible interests included in the exchange.
   20(2)  The required vote or consent of each other class or
21series of shares or eligible interests entitled to vote on
22approval of the exchange by the articles of incorporation or
23organic rules of the acquired entity or section 490.1103,
24subsection 3.
   253.  In addition to the requirements of subsection 1 or 2,
26articles of merger or share exchange may contain any other
27provision not prohibited by law.
   284.  The articles of merger or share exchange shall be
29delivered to the secretary of state for filing and, subject to
30subsection 5, the merger or share exchange shall take effect
31on the effective date determined in accordance with section
32490.123.
   335.  With respect to a merger in which one or more foreign
34entities is a party or a foreign entity created by the merger
35is the survivor, the merger itself shall become effective at
-176-1the later of the following:
   2a.  When all documents required to be filed in foreign
3jurisdictions to effect the merger have become effective.
   4b.  When the articles of merger take effect.
   56.  Articles of merger filed under this section may be
6combined with any filing required under the organic law
7governing any domestic eligible entity involved in the
8transaction if the combined filing satisfies the requirements
9of both this section and the other organic law.
10   Sec. 154.  Section 490.1107, Code 2020, is amended by
11striking the section and inserting in lieu thereof the
12following:
   13490.1107  Effect of merger or share exchange.
   141.  When a merger becomes effective, all of the following
15apply:
   16a.  The domestic or foreign corporation or eligible entity
17that is designated in the plan of merger as the survivor
18continues or comes into existence, as the case may be.
   19b.  The separate existence of every domestic or foreign
20corporation or eligible entity that is a party to the merger,
21other than the survivor, ceases.
   22c.  All property owned by, and every contract right possessed
23by, each domestic or foreign corporation or eligible entity
24that is a party to the merger, other than the survivor, are the
25property and contract rights of the survivor without transfer,
26reversion, or impairment.
   27d.  All debts, obligations, and other liabilities of each
28domestic or foreign corporation or eligible entity that is
29a party to the merger, other than the survivor, are debts,
30obligations, or liabilities of the survivor.
   31e.  The name of the survivor may, but need not be,
32substituted in any pending proceeding for the name of any party
33to the merger whose separate existence ceased in the merger.
   34f.  If the survivor is a domestic entity, the articles of
35incorporation and bylaws or the organic rules of the survivor
-177-1are amended to the extent provided in the plan of merger.
   2g.  The articles of incorporation and bylaws or the organic
3rules of a survivor that is a domestic entity and is created by
4the merger become effective.
   5h.  The shares of each domestic or foreign corporation
6that is a party to the merger, and the eligible interests in
7an eligible entity that is a party to a merger, that are to
8be converted in accordance with the terms of the merger into
9shares, or other securities, eligible interests, obligations,
10rights to acquire shares, other securities, or eligible
11interests, cash, other property, or any combination of the
12foregoing, are converted, and the former holders of such shares
13or eligible interests are entitled only to the rights provided
14to them by those terms or to any rights they may have under
15subchapter XIII or the organic law governing the eligible
16entity or foreign corporation.
   17i.  Except as provided by law or the terms of the merger,
18all the rights, privileges, franchises, and immunities of each
19entity that is a party to the merger, other than the survivor,
20are the rights, privileges, franchises, and immunities of the
21survivor.
   22j.  If the survivor exists before the merger, all of the
23following apply:
   24(1)  All the property and contract rights of the survivor
25remain its property and contract rights without transfer,
26reversion, or impairment.
   27(2)  The survivor remains subject to all its debts,
28obligations, and other liabilities.
   29(3)  Except as provided by law or the plan of merger, the
30survivor continues to hold all of its rights, privileges,
31franchises, and immunities.
   322.  When a share exchange becomes effective, the shares
33or eligible interests in the acquired entity that are to be
34exchanged for shares or other securities, eligible interests,
35obligations, rights to acquire shares, other securities or
-178-1eligible interests, cash, other property, or any combination of
2the foregoing, are entitled only to the rights provided to them
3in the plan of share exchange or to any rights they may have
4under subchapter XIII or under the organic law governing the
5acquired entity.
   63.  Except as otherwise provided in the articles of
7incorporation of a domestic corporation or the organic law
8governing or organic rules of a foreign corporation or a
9domestic or foreign eligible entity, the effect of a merger or
10share exchange on interest holder liability is as follows:
   11a.  A person who becomes subject to new interest holder
12liability in respect of an entity as a result of a merger or
13share exchange shall have that new interest holder liability
14only in respect of interest holder liabilities that arise after
15the merger or share exchange becomes effective.
   16b.  If a person had interest holder liability with respect to
17a party to the merger or the acquired entity before the merger
18or share exchange becomes effective with respect to shares or
19eligible interests of such party or acquired entity which were
20exchanged in the merger or share exchange, were canceled in
21the merger, or the terms and conditions of which relating to
22interest holder liability were amended pursuant to the merger,
23then all of the following apply:
   24(1)  The merger or share exchange does not discharge that
25prior interest holder liability with respect to any interest
26holder liabilities that arose before the merger or share
27exchange becomes effective.
   28(2)  The provisions of the organic law governing any entity
29for which the person had that prior interest holder liability
30shall continue to apply to the collection or discharge of any
31interest holder liabilities preserved by subparagraph (1), as
32if the merger or share exchange had not occurred.
   33(3)  The person shall have such rights of contribution from
34other persons as are provided by the organic law governing the
35entity for which the person had that prior interest holder
-179-1liability with respect to any interest holder liabilities
2preserved by subparagraph (1), as if the merger or share
3exchange had not occurred.
   4(4)  The person shall not, by reason of such prior interest
5holder liability, have interest holder liability with respect
6to any interest holder liabilities that arise after the merger
7or share exchange becomes effective.
   8c.  If a person has interest holder liability both before
9and after a merger becomes effective with unchanged terms and
10conditions with respect to the entity that is the survivor by
11reason of owning the same shares or eligible interests before
12and after the merger becomes effective, the merger has no
13effect on such interest holder liability.
   14d.  A share exchange has no effect on interest holder
15liability related to shares or eligible interests of the
16acquired entity that were not exchanged in the share exchange.
   174.  Upon a merger becoming effective, a foreign corporation,
18or a foreign eligible entity, that is the survivor of the
19merger is deemed to have done all of the following:
   20a.  Appointed the secretary of state as its agent for
21service of process in a proceeding to enforce the rights of
22shareholders of each domestic corporation that is a party to
23the merger who exercise appraisal rights.
   24b.  Agreed that it will promptly pay the amount, if any, to
25which such shareholders are entitled under subchapter XIII.
   265.  Except as provided in the organic law governing a party
27to a merger or in its articles of incorporation or organic
28rules, the merger does not give rise to any rights that an
29interest holder, governor, or third party would have upon a
30dissolution, liquidation, or winding up of that party. The
31merger does not require a party to the merger to wind up its
32affairs and does not constitute or cause its dissolution or
33termination.
   346.  Property held for a charitable purpose under the law of
35this state by a domestic or foreign corporation or eligible
-180-1entity immediately before a merger becomes effective shall not,
2as a result of the transaction, be diverted from the objects
3for which it was donated, granted, devised, or otherwise
4transferred except and to the extent permitted by or pursuant
5to the laws of this state addressing cy pres or dealing with
6nondiversion of charitable assets.
   77.  A bequest, devise, gift, grant, or promise contained
8in a will or other instrument of donation, subscription, or
9conveyance which is made to an entity that is a party to a
10merger that is not the survivor and which takes effect or
11remains payable after the merger inures to the survivor.
   128.  A trust obligation that would govern property if
13transferred to a nonsurviving entity applies to property
14that is transferred to the survivor after a merger becomes
15effective.
16   Sec. 155.  Section 490.1108, Code 2020, is amended by
17striking the section and inserting in lieu thereof the
18following:
   19490.1108  Abandonment of a merger or share exchange.
   201.  After a plan of merger or share exchange has been
21adopted and approved as required by this subchapter, and before
22articles of merger or share exchange have become effective, the
23plan may be abandoned by a domestic business corporation that
24is a party to the plan without action by its shareholders in
25accordance with any procedures set forth in the plan of merger
26or share exchange or, if no such procedures are set forth in
27the plan, in the manner determined by the board of directors.
   282.  If a merger or share exchange is abandoned under
29subsection 1 after articles of merger or share exchange have
30been delivered to the secretary of state for filing but before
31the merger or share exchange has become effective, a statement
32of abandonment signed by all the parties that signed the
33articles of merger or share exchange shall be delivered to the
34secretary of state for filing before the articles of merger
35or share exchange become effective. The statement shall take
-181-1effect on filing and the merger or share exchange shall be
2deemed abandoned and shall not become effective. The statement
3of abandonment must contain all of the following:
   4a.  The name of each party to the merger or the names of the
5acquiring and acquired entities in a share exchange.
   6b.  The date on which the articles of merger or share
7exchange were filed by the secretary of state.
   8c.  A statement that the merger or share exchange has been
9abandoned in accordance with this section.
10   Sec. 156.  Section 490.1201, Code 2020, is amended by
11striking the section and inserting in lieu thereof the
12following:
   13490.1201  Disposition of assets not requiring shareholder
14approval.
   15No approval of the shareholders is required to do any of
16the following, unless the articles of incorporation otherwise
17provide:
   181.  Sell, lease, exchange, or otherwise dispose of any of
19the corporation’s assets in the usual and regular course of
20business.
   212.  Mortgage, pledge, dedicate to the repayment of
22indebtedness, whether with or without recourse, or otherwise
23encumber any or all of the corporation’s assets, regardless of
24whether in the usual and regular course of business.
   253.  Transfer any or all of the corporation’s assets to one or
26more domestic or foreign corporations or other entities, all of
27the shares or interests of which are owned by the corporation.
   284.  Distribute assets pro rata to the holders of one or more
29classes or series of the corporation’s shares.
30   Sec. 157.  Section 490.1202, Code 2020, is amended by
31striking the section and inserting in lieu thereof the
32following:
   33490.1202  Shareholder approval of certain dispositions.
   341.  A sale, lease, exchange, or other disposition of assets,
35other than a disposition described in section 490.1201,
-182-1requires approval of the corporation’s shareholders if the
2disposition would leave the corporation without a significant
3continuing business activity. A corporation will conclusively
4be deemed to have retained a significant continuing business
5activity if it retains a business activity that represented,
6for the corporation and its subsidiaries on a consolidated
7basis, at least twenty-five percent of total assets at the
8end of the most recently completed fiscal year, and either
9twenty-five percent of either income from continuing operations
10before taxes or twenty-five percent of revenues from continuing
11operations, in each case for the most recently completed fiscal
12year; but no presumption that the disposition will leave the
13corporation without a significant continuing business activity
14shall arise from the fact that the corporation’s continuing
15business activity does not equal or exceed any of these
16percentages.
   172.  To obtain the approval of the shareholders under
18subsection 1, all of the following shall apply:
   19a.  The board of directors shall first adopt a resolution
20authorizing the disposition. The disposition shall then be
21approved by the shareholders. In submitting the disposition
22to the shareholders for approval, the board of directors shall
23recommend that the shareholders approve the disposition, unless
24any of the following apply:
   25(1)  The board of directors makes a determination that
26because of conflicts of interest or other special circumstances
27it should not make such a recommendation.
   28(2)  Section 490.826 applies.
   29b.  If paragraph “a”, subparagraph (1) or (2), applies, the
30board shall inform the shareholders of the basis for its so
31proceeding.
   323.  The board of directors may set conditions for the
33approval by the shareholders of a disposition or the
34effectiveness of the disposition.
   354.  If a disposition is required to be approved by the
-183-1shareholders under subsection 1, and if the approval is to
2be given at a meeting, the corporation shall notify each
3shareholder, regardless of whether entitled to vote, of
4the meeting of shareholders at which the disposition is
5to be submitted for approval. The notice must state that
6the purpose, or one of the purposes, of the meeting is to
7consider the disposition and must contain a description of
8the disposition, including the terms and conditions of the
9disposition and the consideration to be received by the
10corporation.
   115.  Unless the articles of incorporation, bylaws, or the
12board of directors acting pursuant to subsection 3 require
13a greater vote or a greater quorum, the approval of a
14disposition by the shareholders shall require the approval
15of the shareholders at a meeting at which a quorum exists
16consisting of a majority of the votes entitled to be cast on
17the disposition.
   186.  After a disposition has been approved by the shareholders
19under this subchapter, and at any time before the disposition
20has been consummated, it may be abandoned by the corporation
21without action by the shareholders, subject to any contractual
22rights of other parties to the disposition.
   237.  A disposition of assets in the course of dissolution
24under subchapter XIV is not governed by this section.
   258.  The assets of a direct or indirect consolidated
26subsidiary shall be deemed to be the assets of the parent
27corporation for the purposes of this section.
28   Sec. 158.  Section 490.1301, Code 2020, is amended by
29striking the section and inserting in lieu thereof the
30following:
   31490.1301  Subchapter definitions.
   32As used in this subchapter:
   331.  “Affiliate” means a person that directly or indirectly
34through one or more intermediaries controls, is controlled by,
35or is under common control with another person or is a senior
-184-1executive of such person. For purposes of section 490.1302,
2subsection 2, paragraph “d”, a person is deemed to be an
3affiliate of its senior executives.
   42.  “Corporation” means the domestic corporation that is the
5issuer of the shares held by a shareholder demanding appraisal
6and, for matters covered in sections 490.1322 through 490.1331,
7“corporation” includes the survivor of a merger.
   83.  “Fair value” means the value of the corporation’s shares
9determined according to the following:
   10a.  Immediately before the effectiveness of the corporate
11action to which the shareholder objects.
   12b.  Using customary and current valuation concepts and
13techniques generally employed for similar businesses in the
14context of the transaction requiring appraisal.
   15c.  Without discounting for lack of marketability or minority
16status except, if appropriate, for amendments to the articles
17of incorporation pursuant to section 490.1302, subsection 1,
18paragraph “d”.
   194.  “Interest” means interest from the date the corporate
20action becomes effective until the date of payment, at the rate
21of interest on judgments in this state on the effective date
22of the corporate action.
   235.  “Interested transaction” means a corporate action
24described in section 490.1302, subsection 1, other than a
25merger pursuant to section 490.1105, involving an interested
26person in which any of the shares or assets of the corporation
27are being acquired or converted. As used in this subsection:
   28a.  “Beneficial owner” means any person who, directly
29or indirectly, through any contract, arrangement, or
30understanding, other than a revocable proxy, has or shares the
31power to vote, or to direct the voting of, shares; except that
32a member of a national securities exchange is not deemed to be
33a beneficial owner of securities held directly or indirectly
34by it on behalf of another person if the member is precluded
35by the rules of the exchange from voting without instruction
-185-1on contested matters or matters that may affect substantially
2the rights or privileges of the holders of the securities to
3be voted. When two or more persons agree to act together for
4the purpose of voting their shares of the corporation, each
5member of the group formed thereby is deemed to have acquired
6beneficial ownership, as of the date of the agreement, of all
7shares having voting power of the corporation beneficially
8owned by any member of the group.
   9b.  “Excluded shares” means shares acquired pursuant to an
10offer for all shares having voting power if the offer was made
11within one year before the corporate action for consideration
12of the same kind and of a value equal to or less than that paid
13in connection with the corporate action.
   14c.  “Interested person” means a person, or an affiliate of a
15person, who at any time during the one-year period immediately
16preceding approval by the board of directors of the corporate
17action was or had any of the following:
   18(1)  Was the beneficial owner of twenty percent or more of
19the voting power of the corporation, other than as owner of
20excluded shares.
   21(2)  Had the power, contractually or otherwise, other than as
22owner of excluded shares, to cause the appointment or election
23of twenty-five percent or more of the directors to the board of
24directors of the corporation.
   25(3)  Was a senior executive or director of the corporation
26or a senior executive of any affiliate of the corporation, and
27that senior executive or director will receive, as a result
28of the corporate action, a financial benefit not generally
29available to other shareholders as such, other than any of the
30following:
   31(a)  Employment, consulting, retirement, or similar benefits
32established separately and not as part of or in contemplation
33of the corporate action.
   34(b)  Employment, consulting, retirement, or similar benefits
35established in contemplation of, or as part of, the corporate
-186-1action that are not more favorable than those existing before
2the corporate action or, if more favorable, that have been
3approved on behalf of the corporation in the same manner as is
4provided in section 490.862.
   5(c)  In the case of a director of the corporation who will,
6in the corporate action, become a director or governor of the
7acquiror or any of its affiliates, rights, and benefits as a
8director or governor that are provided on the same basis as
9those afforded by the acquiror generally to other directors or
10governors of such entity or such affiliate.
   116.  “Preferred shares” means a class or series of shares
12whose holders have preference over any other class or series of
13shares with respect to distributions.
   147.  “Senior executive” means the chief executive officer,
15chief operating officer, chief financial officer, and any
16individual in charge of a principal business unit or function.
   178.  “Shareholder” means a record shareholder, a beneficial
18shareholder, and a voting trust beneficial owner.
19   Sec. 159.  Section 490.1302, Code 2020, is amended by
20striking the section and inserting in lieu thereof the
21following:
   22490.1302  Right to appraisal.
   231.  A shareholder is entitled to appraisal rights, and to
24obtain payment of the fair value of that shareholder’s shares,
25in the event of any of the following corporate actions:
   26a.  Consummation of a merger to which the corporation is a
27party if any of the following apply:
   28(1)  Shareholder approval is required for the merger by
29section 490.1104 or would be required but for the provisions of
30section 490.1104, subsection 10, except that appraisal rights
31shall not be available to any shareholder of the corporation
32with respect to shares of any class or series that remain
33outstanding after consummation of the merger.
   34(2)  The corporation is a subsidiary and the merger is
35governed by section 490.1105.
-187-   1b.  Consummation of a share exchange to which the corporation
2is a party the shares of which will be acquired, except that
3appraisal rights shall not be available to any shareholder of
4the corporation with respect to any class or series of shares
5of the corporation that is not acquired in the share exchange.
   6c.  Consummation of a disposition of assets pursuant to
7section 490.1202 if the shareholder is entitled to vote on
8the disposition, except that appraisal rights shall not be
9available to any shareholder of the corporation with respect to
10shares of any class or series if all of the following apply:
   11(1)  Under the terms of the corporate action approved by the
12shareholders there is to be distributed to shareholders in cash
13the corporation’s net assets, in excess of a reasonable amount
14reserved to meet claims of the type described in sections
15490.1406 and 490.1407, if the distribution is made subject to
16all of the following:
   17(a)  Within one year after the shareholders’ approval of the
18action.
   19(b)  In accordance with the shareholders’ respective
20interests determined at the time of distribution.
   21(2)  The disposition of assets is not an interested
22transaction.
   23d.  An amendment of the articles of incorporation with
24respect to a class or series of shares that reduces the number
25of shares of a class or series owned by the shareholder to a
26fraction of a share if the corporation has the obligation or
27right to repurchase the fractional share so created.
   28e.  Any other merger, share exchange, disposition of assets,
29or amendment to the articles of incorporation, in each case to
30the extent provided by the articles of incorporation, bylaws,
31or a resolution of the board of directors.
   32f.  Consummation of a domestication pursuant to section
33490.920 if the shareholder does not receive shares in the
34foreign corporation resulting from the domestication that have
35terms as favorable to the shareholder in all material respects,
-188-1and represent at least the same percentage interest of the
2total voting rights of the outstanding shares of the foreign
3corporation, as the shares held by the shareholder before the
4domestication.
   5g.  Consummation of a conversion of the corporation to a
6nonprofit corporation pursuant to section 490.930.
   7h.  Consummation of a conversion of the corporation to an
8unincorporated entity pursuant to section 490.930.
   92.  Notwithstanding subsection 1, the availability of
10appraisal rights under subsection 1, paragraphs “a”, “b”, “c”,
11“d”, “f”, and “h”, shall be limited in accordance with the
12following provisions:
   13a.  Appraisal rights shall not be available for the holders
14of shares of any class or series of shares which is any of the
15following:
   16(1)  A covered security under section 18(b)(1)(A) or (B) of
17the federal Securities Act of 1933, as amended.
   18(2)  Traded in an organized market and has at least two
19thousand shareholders and a market value of at least twenty
20million dollars, exclusive of the value of such shares held
21by the corporation’s subsidiaries, senior executives and
22directors, and by any beneficial shareholder and any voting
23trust beneficial owner owning more than ten percent of such
24shares.
   25(3)  Issued by an open-end management investment company
26registered with the United States securities and exchange
27commission under the federal Investment Company Act of 1940, 15
28U.S.C. §80a-1 et seq., and which may be redeemed at the option
29of the holder at net asset value.
   30b.  The applicability of paragraph “a” shall be determined
31according to the following:
   32(1)  The record date fixed to determine the shareholders
33entitled to receive notice of the meeting of shareholders to
34act upon the corporate action requiring appraisal rights or
35in the case of an offer made pursuant to section 490.1104,
-189-1subsection 10, the date of such offer.
   2(2)  If there is no meeting of shareholders and no offer made
3pursuant to section 490.1104, subsection 10, the day before the
4consummation of the corporate action or effective date of the
5amendment of the articles of incorporation, as applicable.
   6c.  Paragraph “a” shall not be applicable and appraisal
7rights shall be available pursuant to subsection 1 under the
8following circumstances:
   9(1)  For the holders of any class or series of shares who
10are required by the terms of the corporate action requiring
11appraisal rights to accept for such shares anything other than
12cash or shares of any class or any series of shares of any
13corporation, or any other proprietary interest of any other
14entity, that satisfies the standards set forth in paragraph “a”,
15at the time the corporate action becomes effective.
   16(2)  For the holders of any class or series of shares, in the
17case of the consummation of a disposition of assets pursuant
18to section 490.1202, unless the cash, shares, or proprietary
19interests received in the disposition are, under the terms
20of the corporate action approved by the shareholders, to be
21distributed to the shareholders, as part of a distribution to
22shareholders of the net assets of the corporation in excess of
23a reasonable amount to meet claims of the type described in
24sections 490.1406 and 490.1407, if the distribution is made
25subject to all of the following:
   26(a)  Within one year after the shareholders’ approval of the
27action.
   28(b)  In accordance with the shareholders’ respective
29interests determined at the time of the distribution.
   30d.  Paragraph “a” shall not be applicable and appraisal
31rights shall be available pursuant to subsection 1 for the
32holders of any class or series of shares where the corporate
33action is an interested transaction.
   343.  Notwithstanding any other provision of this section, the
35articles of incorporation as originally filed or any amendment
-190-1to the articles of incorporation may limit or eliminate
2appraisal rights for any class or series of preferred shares,
3except that the following shall apply:
   4a.  Except as provided in paragraph “b”, no such limitation
5or elimination shall be effective if the class or series does
6not have the right to vote separately as a voting group, alone
7or as part of a group, on the action or if the action is a
8conversion under section 490.930, or a merger having a similar
9effect as a conversion in which the converted entity is an
10eligible entity.
   11b.  Any such limitation or elimination contained in an
12amendment to the articles of incorporation that limits or
13eliminates appraisal rights for any of such shares that are
14outstanding immediately before the effective date of such
15amendment or that the corporation is or may be required to
16issue or sell thereafter pursuant to any conversion, exchange,
17or other right existing immediately before the effective date
18of such amendment, shall not apply to any corporate action that
19becomes effective within one year after the effective date of
20such amendment if such action would otherwise afford appraisal
21rights.
22   Sec. 160.  Section 490.1303, Code 2020, is amended by
23striking the section and inserting in lieu thereof the
24following:
   25490.1303  Assertion of rights by nominees and beneficial
26shareholders.
   271.  A record shareholder may assert appraisal rights
28as to fewer than all the shares registered in the record
29shareholder’s name but owned by a beneficial shareholder or a
30voting trust beneficial owner only if the record shareholder
31objects with respect to all shares of a class or series owned
32by the beneficial shareholder or the voting trust beneficial
33owner and notifies the corporation in writing of the name
34and address of each beneficial shareholder or voting trust
35beneficial owner on whose behalf appraisal rights are being
-191-1asserted. The rights of a record shareholder who asserts
2appraisal rights for only part of the shares held of record in
3the record shareholder’s name under this subsection shall be
4determined as if the shares as to which the record shareholder
5objects and the record shareholder’s other shares were
6registered in the names of different record shareholders.
   72.  A beneficial shareholder and a voting trust beneficial
8owner may assert appraisal rights as to shares of any class
9or series held on behalf of the shareholder only if such
10shareholder does all of the following:
   11a.  Submits to the corporation the record shareholder’s
12written consent to the assertion of such rights no later
13than the date referred to in section 490.1322, subsection 2,
14paragraph “b”, subparagraph (2).
   15b.  Does so with respect to all shares of the class or series
16that are beneficially owned by the beneficial shareholder or
17the voting trust beneficial owner.
18   Sec. 161.  Section 490.1320, Code 2020, is amended by
19striking the section and inserting in lieu thereof the
20following:
   21490.1320  Notice of appraisal rights.
   221.  Where any corporate action specified in section
23490.1302, subsection 1, is to be submitted to a vote at a
24shareholders’ meeting, the meeting notice, or where no approval
25of such action is required pursuant to section 490.1104,
26subsection 10, the offer made pursuant to that section, must
27state that the corporation has concluded that appraisal rights
28are, are not, or may be available under this subchapter. If
29the corporation concludes that appraisal rights are or may be
30available, a copy of this subchapter must accompany the meeting
31notice or offer sent to those record shareholders entitled to
32exercise appraisal rights.
   332.  In a merger pursuant to section 490.1105, the parent
34entity shall notify in writing all record shareholders of the
35subsidiary who are entitled to assert appraisal rights that the
-192-1corporate action became effective. Such notice shall be sent
2within ten days after the corporate action became effective and
3include the materials described in section 490.1322.
   43.  Where any corporate action specified in section
5490.1302, subsection 1, is to be approved by written consent
6of the shareholders pursuant to section 490.704, all of the
7following apply:
   8a.  Written notice that appraisal rights are, are not, or may
9be available shall be sent to each record shareholder from whom
10a consent is solicited at the time consent of such shareholder
11is first solicited and, if the corporation has concluded that
12appraisal rights are or may be available, the notice must be
13accompanied by a copy of this subchapter.
   14b.  Written notice that appraisal rights are, are not, or
15may be available must be delivered together with the notice to
16nonconsenting and nonvoting shareholders required by section
17490.704, subsections 5 and 6, may include the materials
18described in section 490.1322, and, if the corporation has
19concluded that appraisal rights are or may be available, must
20be accompanied by a copy of this subchapter.
   214.  Where corporate action described in section 490.1302,
22subsection 1, is proposed, or a merger pursuant to section
23490.1105 is effected, the notice referred to in subsection 1
24or 3, if the corporation concludes that appraisal rights are
25or may be available, and in subsection 2 must be accompanied
26by all of the following:
   27a.  Financial statements of the corporation that issued
28the shares that may be subject to appraisal, consisting of a
29balance sheet as of the end of a fiscal year ending not more
30than sixteen months before the date of the notice, an income
31statement for that year, and a cash flow statement for that
32year; provided that, if such financial statements are not
33reasonably available, the corporation shall provide reasonably
34equivalent financial information.
   35b.  The latest interim financial statements of such
-193-1corporation, if any.
   25.  The right to receive the information described in
3subsection 4 may be waived in writing by a shareholder before
4or after the corporate action.
5   Sec. 162.  Section 490.1321, Code 2020, is amended by
6striking the section and inserting in lieu thereof the
7following:
   8490.1321  Notice of intent to demand payment and consequences
9of voting or consenting.
   101.  If a corporate action specified in section 490.1302,
11subsection 1, is submitted to a vote at a shareholders’
12meeting, a shareholder who wishes to assert appraisal rights
13with respect to any class or series of shares must do all of the
14following:
   15a.  Deliver to the corporation, before the vote is taken,
16written notice of the shareholder’s intent to demand payment if
17the proposed action is effectuated.
   18b.  Not vote, or cause or permit to be voted, any shares of
19such class or series in favor of the proposed action.
   202.  If a corporate action specified in section 490.1302,
21subsection 1, is to be approved by written consent, a
22shareholder who wishes to assert appraisal rights with respect
23to any class or series of shares shall not sign a consent in
24favor of the proposed action with respect to that class or
25series of shares.
   263.  If a corporate action specified in section 490.1302,
27subsection 1, does not require shareholder approval pursuant to
28section 490.1104, subsection 10, a shareholder who wishes to
29assert appraisal rights with respect to any class or series of
30shares must do all of the following:
   31a.  Deliver to the corporation before the shares are
32purchased pursuant to the offer written notice of the
33shareholder’s intent to demand payment if the proposed action
34is effected.
   35b.  Not tender, or cause or permit to be tendered, any shares
-194-1of such class or series in response to such offer.
   24.  A shareholder who fails to satisfy the requirements of
3subsection 1, 2, or 3 is not entitled to payment under this
4subchapter.
5   Sec. 163.  Section 490.1322, Code 2020, is amended by
6striking the section and inserting in lieu thereof the
7following:
   8490.1322  Appraisal notice and form.
   91.  If a corporate action requiring appraisal rights
10under section 490.1302, subsection 1, becomes effective, the
11corporation shall deliver a written appraisal notice and form
12required by subsection 2, to all shareholders who satisfy the
13requirements of section 490.1321, subsection 1, 2, or 3. In
14the case of a merger under section 490.1105, the parent shall
15deliver an appraisal notice and form to all record shareholders
16who may be entitled to assert appraisal rights.
   172.  The appraisal notice shall be delivered no earlier than
18the date the corporate action specified in section 490.1302,
19subsection 1, became effective, and no later than ten days
20after such date, and must do all of the following:
   21a.  Supply a form that does all of the following:
   22(1)  Specifies the first date of any announcement to
23shareholders made before the date the corporate action became
24effective of the principal terms of the proposed corporate
25action.
   26(2)  If such announcement was made, requires the shareholder
27asserting appraisal rights to certify whether beneficial
28ownership of those shares for which appraisal rights are
29asserted was acquired before that date.
   30(3)  Requires the shareholder asserting appraisal rights to
31certify that such shareholder did not vote for or consent to
32the transaction as to the class or series of shares for which
33appraisal is sought.
   34b.  State all of the following:
   35(1)  Where the form shall be sent and where certificates for
-195-1certificated shares shall be deposited and the date by which
2those certificates must be deposited, which date shall not be
3earlier than the date by which the corporation must receive the
4required form under subparagraph (2).
   5(2)  A date by which the corporation shall receive the
6form, which date shall not be fewer than forty nor more than
7sixty days after the date the appraisal notice is sent under
8subsection 1, and state that the shareholder shall have waived
9the right to demand appraisal with respect to the shares unless
10the form is received by the corporation by such specified date.
   11(3)  The corporation’s estimate of the fair value of the
12shares.
   13(4)  That, if requested in writing, the corporation will
14provide, to the shareholder so requesting, within ten days
15after the date specified in subparagraph (2) the number of
16shareholders who return the forms by the specified date and the
17total number of shares owned by them.
   18(5)  The date by which the notice to withdraw under section
19490.1323 shall be received, which date shall be within twenty
20days after the date specified in subparagraph (2).
   21c.  Be accompanied by a copy of this subchapter.
22   Sec. 164.  Section 490.1323, Code 2020, is amended by
23striking the section and inserting in lieu thereof the
24following:
   25490.1323  Perfection of rights — right to withdraw.
   261.  A shareholder who receives notice pursuant to section
27490.1322 and who wishes to exercise appraisal rights shall
28sign and return the form sent by the corporation and, in
29the case of certificated shares, deposit the shareholder’s
30certificates in accordance with the terms of the notice by the
31date referred to in the notice pursuant to section 490.1322,
32subsection 2, paragraph “b”, subparagraph (2). In addition,
33if applicable, the shareholder shall certify on the form
34whether the beneficial owner of such shares acquired beneficial
35ownership of the shares before the date required to be set
-196-1forth in the notice pursuant to section 490.1322, subsection
22, paragraph “a”, subparagraph (1). If a shareholder fails to
3make this certification, the corporation may elect to treat the
4shareholder’s shares as after-acquired shares under section
5490.1325. Once a shareholder deposits that shareholder’s
6certificates or, in the case of uncertificated shares, returns
7the signed forms, that shareholder loses all rights as a
8shareholder, unless the shareholder withdraws pursuant to
9subsection 2.
   102.  A shareholder who has complied with subsection 1 may
11nevertheless decline to exercise appraisal rights and withdraw
12from the appraisal process by so notifying the corporation in
13writing by the date set forth in the appraisal notice pursuant
14to section 490.1322, subsection 2, paragraph “b”, subparagraph
15(5). A shareholder who fails to so withdraw from the appraisal
16process shall not thereafter withdraw without the corporation’s
17written consent.
   183.  A shareholder who does not sign and return the form and,
19in the case of certificated shares, deposit that shareholder’s
20share certificates where required, each by the date set forth
21in the notice described in section 490.1322, subsection 2,
22shall not be entitled to payment under this subchapter.
23   Sec. 165.  Section 490.1324, Code 2020, is amended by
24striking the section and inserting in lieu thereof the
25following:
   26490.1324  Payment.
   271.  Except as provided in section 490.1325, within thirty
28days after the form required by section 490.1322, subsection 2,
29paragraph “b”, subparagraph (2), is due, the corporation shall
30pay in cash to those shareholders who complied with section
31490.1323, subsection 1, the amount the corporation estimates to
32be the fair value of their shares, plus interest.
   332.  The payment to each shareholder pursuant to subsection 1
34must be accompanied by all of the following:
   35a.  (1)  Financial statements of the corporation that issued
-197-1the shares to be appraised, consisting of a balance sheet as
2of the end of a fiscal year ending not more than sixteen months
3before the date of payment, an income statement for that year,
4and a cash flow statement for that year; provided that, if
5such annual financial statements are not reasonably available,
6the corporation shall provide reasonably equivalent financial
7information.
   8(2)  The latest interim financial statements of such
9corporation, if any.
   10b.  A statement of the corporation’s estimate of the fair
11value of the shares, which estimate shall equal or exceed the
12corporation’s estimate given pursuant to section 490.1322,
13subsection 2, paragraph “b”, subparagraph (3).
   14c.  A statement that shareholders described in subsection
151 have the right to demand further payment under section
16490.1326 and that if any such shareholder does not do so within
17the time period specified in section 490.1326, subsection 2,
18such shareholder shall be deemed to have accepted the payment
19under subsection 1 in full satisfaction of the corporation’s
20obligations under this subchapter.
21   Sec. 166.  Section 490.1325, Code 2020, is amended by
22striking the section and inserting in lieu thereof the
23following:
   24490.1325  After-acquired shares.
   251.  A corporation may elect to withhold payment required
26by section 490.1324 from any shareholder who was required to,
27but did not certify that beneficial ownership of all of the
28shareholder’s shares for which appraisal rights are asserted
29was acquired before the date set forth in the appraisal notice
30sent pursuant to section 490.1322, subsection 2, paragraph “a”.
   312.  If the corporation elected to withhold payment under
32subsection 1, within thirty days after the form required by
33section 490.1322, subsection 2, paragraph “b”, subparagraph
34(2), is due, the corporation shall notify all shareholders who
35are described in subsection 1 regarding all of the following:
-198-   1a.  Of the information required by section 490.1324,
2subsection 2, paragraph “a”.
   3b.  Of the corporation’s estimate of fair value pursuant to
4section 490.1324, subsection 2, paragraph “b”.
   5c.  That they may accept the corporation’s estimate of fair
6value, plus interest, in full satisfaction of their demands or
7demand appraisal under section 490.1326.
   8d.  That those shareholders who wish to accept such offer
9shall so notify the corporation of their acceptance of the
10corporation’s offer within thirty days after receiving the
11offer.
   12e.  That those shareholders who do not satisfy the
13requirements for demanding appraisal under section 490.1326
14shall be deemed to have accepted the corporation’s offer.
   153.  Within ten days after receiving the shareholder’s
16acceptance pursuant to subsection 2, paragraph “d”, the
17corporation shall pay in cash the amount it offered under
18subsection 2, paragraph “b”, plus interest to each shareholder
19who agreed to accept the corporation’s offer in full
20satisfaction of the shareholder’s demand.
   214.  Within forty days after delivering the notice described
22in subsection 2, the corporation shall pay in cash the amount
23it offered to pay under subsection 2, paragraph “b”, plus
24interest to each shareholder described in subsection 2,
25paragraph “e”.
26   Sec. 167.  Section 490.1326, Code 2020, is amended by
27striking the section and inserting in lieu thereof the
28following:
   29490.1326  Procedure if shareholder dissatisfied with payment
30or offer.
   311.  A shareholder paid pursuant to section 490.1324 who is
32dissatisfied with the amount of the payment shall notify the
33corporation in writing of that shareholder’s estimate of the
34fair value of the shares and demand payment of that estimate,
35less any payment under section 490.1324 plus interest. A
-199-1shareholder offered payment under section 490.1325 who is
2dissatisfied with that offer shall reject the offer and demand
3payment of the shareholder’s stated estimate of the fair value
4of the shares plus interest.
   52.  A shareholder who fails to notify the corporation
6in writing of that shareholder’s demand to be paid the
7shareholder’s stated estimate of the fair value plus interest
8under subsection 1 within thirty days after receiving the
9corporation’s payment or offer of payment under section
10490.1324 or 490.1325, respectively, waives the right to demand
11payment under this section and shall be entitled only to the
12payment made or offered pursuant to those respective sections.
13   Sec. 168.  Section 490.1330, Code 2020, is amended by
14striking the section and inserting in lieu thereof the
15following:
   16490.1330  Court action.
   171.  If a shareholder makes a demand for payment under
18section 490.1326 which remains unsettled, the corporation shall
19commence a proceeding within sixty days after receiving the
20payment demand and petition the court to determine the fair
21value of the shares and accrued interest. If the corporation
22does not commence the proceeding within the sixty-day
23period, it shall pay in cash to each shareholder the amount
24the shareholder demanded pursuant to section 490.1326 plus
25interest.
   262.  The corporation shall commence the proceeding in the
27district court of the county where the corporation’s principal
28office or, if none, its registered office, in this state is
29located. If the corporation is a foreign corporation without
30a registered office in this state, it shall commence the
31proceeding in the county in this state where the principal
32office or registered office of the domestic corporation merged
33with the foreign corporation was located at the time of the
34transaction.
   353.  The corporation shall make all shareholders, regardless
-200-1of whether they are residents of this state, whose demands
2remain unsettled parties to the proceeding as in an action
3against their shares, and all parties shall be served with a
4copy of the petition. Nonresidents may be served by registered
5or certified mail or by publication as provided by law.
   64.  The jurisdiction of the court in which the proceeding
7is commenced under subsection 2 is plenary and exclusive.
8The court may appoint one or more persons as appraisers to
9receive evidence and recommend a decision on the question of
10fair value. The appraisers shall have the powers described
11in the order appointing them, or in any amendment to it. The
12shareholders demanding appraisal rights are entitled to the
13same discovery rights as parties in other civil proceedings.
14There shall be no right to a jury trial.
   155.  Each shareholder made a party to the proceeding is
16entitled to judgment for any of the following:
   17a.  The amount, if any, by which the court finds the fair
18value of the shareholder’s shares exceeds the amount paid
19by the corporation to the shareholder for such shares, plus
20interest.
   21b.  The fair value, plus interest, of the shareholder’s
22shares for which the corporation elected to withhold payment
23under section 490.1325.
24   Sec. 169.  Section 490.1331, Code 2020, is amended by
25striking the section and inserting in lieu thereof the
26following:
   27490.1331  Court costs and expenses.
   281.  The court in an appraisal proceeding commenced under
29section 490.1330 shall determine all court costs of the
30proceeding, including the reasonable compensation and expenses
31of appraisers appointed by the court. The court shall assess
32the court costs against the corporation, except that the court
33may assess court costs against all or some of the shareholders
34demanding appraisal, in amounts which the court finds
35equitable, to the extent the court finds such shareholders
-201-1acted arbitrarily, vexatiously, or not in good faith with
2respect to the rights provided by this subchapter.
   32.  The court in an appraisal proceeding may also assess the
4expenses of the respective parties in amounts the court finds
5equitable, against any of the following:
   6a.  The corporation and in favor of any or all shareholders
7demanding appraisal if the court finds the corporation did not
8substantially comply with the requirements of section 490.1320,
9490.1322, 490.1324, or 490.1325.
   10b.  Either the corporation or a shareholder demanding
11appraisal, in favor of any other party, if the court finds that
12the party against whom expenses are assessed acted arbitrarily,
13vexatiously, or not in good faith with respect to the rights
14provided by this subchapter.
   153.  If the court in an appraisal proceeding finds that
16the expenses incurred by any shareholder were of substantial
17benefit to other shareholders similarly situated and that such
18expenses should not be assessed against the corporation, the
19court may direct that such expenses be paid out of the amounts
20awarded the shareholders who were benefited.
   214.  To the extent the corporation fails to make a required
22payment pursuant to section 490.1324, 490.1325, or 490.1326,
23the shareholder may sue directly for the amount owed, and to
24the extent successful, shall be entitled to recover from the
25corporation all expenses of the suit.
26   Sec. 170.  Section 490.1340, Code 2020, is amended by
27striking the section and inserting in lieu thereof the
28following:
   29490.1340  Other remedies limited.
   301.  The legality of a proposed or completed corporate
31action described in section 490.1302, subsection 1, shall not
32be contested, nor may the corporate action be enjoined, set
33aside, or rescinded, in a legal or equitable proceeding by a
34shareholder after the shareholders have approved the corporate
35action.
-202-   12.  Subsection 1 does not apply to a corporate action that
2meets any of the following conditions:
   3a.  Was not authorized and approved in accordance with the
4applicable provisions of any of the following:
   5(1)  Subchapter IX, X, XI, or XII.
   6(2)  The articles of incorporation or bylaws.
   7(3)  The resolution of the board of directors authorizing the
8corporate action.
   9b.  Was procured as a result of fraud, a material
10misrepresentation, or an omission of a material fact necessary
11to make statements made, in light of the circumstances in which
12they were made, not misleading.
   13c.  Is an interested transaction, unless it has been
14recommended by the board of directors in the same manner as
15is provided in section 490.862 and has been approved by the
16shareholders in the same manner as is provided in section
17490.863 as if the interested transaction were a director’s
18conflicting interest transaction.
   19d.  Is approved by less than unanimous consent of the
20voting shareholders pursuant to section 490.704 if all of the
21following apply:
   22(1)  The challenge to the corporate action is brought by a
23shareholder who did not consent and as to whom notice of the
24approval of the corporate action was not effective at least ten
25days before the corporate action was effected.
   26(2)  The proceeding challenging the corporate action is
27commenced within ten days after notice of the approval of the
28corporate action is effective as to the shareholder bringing
29the proceeding.
30   Sec. 171.  Section 490.1402, Code 2020, is amended by
31striking the section and inserting in lieu thereof the
32following:
   33490.1402  Dissolution by board of directors and shareholders.
   341.  The board of directors may propose dissolution for
35submission to the shareholders by first adopting a resolution
-203-1authorizing the dissolution.
   22.  a.  For a proposal to dissolve to be adopted, it shall
3then be approved by the shareholders. In submitting the
4proposal to dissolve to the shareholders for approval, the
5board of directors shall recommend that the shareholders
6approve the dissolution, unless any of the following apply:
   7(1)  The board of directors determines that because of
8conflict of interest or other special circumstances it should
9make no recommendation.
   10(2)  Section 490.826 applies.
   11b.  If paragraph “a”, subparagraph (1) or (2), applies, the
12board shall inform the shareholders of the basis for its so
13proceeding.
   143.  The board of directors may set conditions for the
15approval of the proposal for dissolution by shareholders or the
16effectiveness of the dissolution.
   174.  If the approval of the shareholders is to be given at
18a meeting, the corporation shall notify each shareholder,
19regardless of whether entitled to vote, of the meeting of
20shareholders at which the dissolution is to be submitted for
21approval. The notice must state that the purpose, or one of
22the purposes, of the meeting is to consider dissolving the
23corporation.
   245.  Unless the articles of incorporation, bylaws, or the
25board of directors acting pursuant to subsection 3 require a
26greater vote, a greater quorum, or a vote by voting groups,
27adoption of the proposal to dissolve shall require the approval
28of the shareholders at a meeting at which a quorum exists
29consisting of a majority of the votes entitled to be cast on
30the proposal to dissolve.
31   Sec. 172.  Section 490.1403, Code 2020, is amended by
32striking the section and inserting in lieu thereof the
33following:
   34490.1403  Articles of dissolution.
   351.  At any time after dissolution is authorized, the
-204-1corporation may dissolve by delivering to the secretary of
2state for filing articles of dissolution setting forth all of
3the following:
   4a.  The name of the corporation.
   5b.  The date that dissolution was authorized.
   6c.  If dissolution was approved by the shareholders, a
7statement that the proposal to dissolve was duly approved by
8the shareholders in the manner required by this chapter and by
9the articles of incorporation and bylaws.
   102.  The articles of dissolution shall take effect at the
11effective date determined in accordance with section 490.123.
12A corporation is dissolved upon the effective date of its
13articles of dissolution.
   143.  As used in this part, “dissolved corporation” means a
15corporation whose articles of dissolution have become effective
16and includes a successor entity to which the remaining assets
17of the corporation are transferred subject to its liabilities
18for purposes of liquidation.
19   Sec. 173.  Section 490.1404, Code 2020, is amended by
20striking the section and inserting in lieu thereof the
21following:
   22490.1404  Revocation of dissolution.
   231.  A corporation may revoke its dissolution within one
24hundred twenty days after its effective date.
   252.  Revocation of dissolution shall be authorized in the
26same manner as the dissolution was authorized unless that
27authorization permitted revocation by action of the board of
28directors alone, in which event the board of directors may
29revoke the dissolution without shareholder action.
   303.  After the revocation of dissolution is authorized,
31the corporation may revoke the dissolution by delivering to
32the secretary of state for filing articles of revocation
33of dissolution, together with a copy of its articles of
34dissolution, that set forth all of the following:
   35a.  The name of the corporation.
-205-   1b.  The effective date of the dissolution that was revoked.
   2c.  The date that the revocation of dissolution was
3authorized.
   4d.  If the corporation’s board of directors or incorporators
5revoked the dissolution, a statement to that effect.
   6e.  If the corporation’s board of directors revoked a
7dissolution as authorized by the shareholders, a statement that
8revocation was permitted by action by the board of directors
9alone pursuant to that authorization.
   10f.  If shareholder action was required to revoke the
11dissolution, a statement that the revocation was duly approved
12by the shareholders in the manner required by this chapter and
13by the articles of incorporation and bylaws.
   144.  The articles of revocation of dissolution shall take
15effect at the effective date determined in accordance with
16section 490.123. Revocation of dissolution is effective
17upon the effective date of the articles of revocation of
18dissolution.
   195.  When the revocation of dissolution is effective, it
20relates back to and takes effect as of the effective date of
21the dissolution and the corporation resumes carrying on its
22business as if the dissolution had never occurred.
23   Sec. 174.  Section 490.1405, Code 2020, is amended by
24striking the section and inserting in lieu thereof the
25following:
   26490.1405  Effect of dissolution.
   271.  A corporation that has dissolved continues its corporate
28existence but the dissolved corporation shall not carry on any
29business except that appropriate to wind up and liquidate its
30business and affairs, including by doing any of the following:
   31a.  Collecting its assets.
   32b.  Disposing of its properties that will not be distributed
33in kind to its shareholders.
   34c.  Discharging or making provision for discharging its
35liabilities.
-206-   1d.  Making distributions of its remaining assets among its
2shareholders according to their interests.
   3e.  Doing every other act necessary to wind up and liquidate
4its business and affairs.
   52.  Dissolution of a corporation does not do any of the
6following:
   7a.  Transfer title to the corporation’s property.
   8b.  Prevent transfer of its shares or securities.
   9c.  Subject its directors or officers to standards of conduct
10different from those prescribed in subchapter VIII.
   11d.  Change any of the following:
   12(1)  Quorum or voting requirements for its board of directors
13or shareholders.
   14(2)  Provisions for selection, resignation, or removal of
15its directors or officers or both.
   16(3)  Provisions for amending its bylaws.
   17e.  Prevent commencement of a proceeding by or against the
18corporation in its corporate name.
   19f.  Abate or suspend a proceeding pending by or against the
20corporation on the effective date of dissolution.
   21g.  Terminate the authority of the registered agent of the
22corporation.
   233.  A distribution in liquidation under this section may
24only be made by a dissolved corporation. For purposes of
25determining the shareholders entitled to receive a distribution
26in liquidation, the board of directors may fix a record date
27for determining shareholders entitled to a distribution in
28liquidation, which date shall not be retroactive. If the
29board of directors does not fix a record date for determining
30shareholders entitled to a distribution in liquidation, the
31record date is the date the board of directors authorizes the
32distribution in liquidation.
33   Sec. 175.  Section 490.1406, Code 2020, is amended by
34striking the section and inserting in lieu thereof the
35following:
-207-   1490.1406  Known claims against dissolved corporation.
   21.  A dissolved corporation may dispose of the known claims
3against it by notifying its known claimants in writing of the
4dissolution at any time after its effective date.
   52.  The written notice must do all of the following:
   6a.  Describe information that must be included in a claim.
   7b.  Provide a mailing address where a claim may be sent.
   8c.  State the deadline, which must not be fewer than one
9hundred twenty days after the written notice is effective, by
10which the dissolved corporation shall receive the claim.
   11d.  State that the claim will be barred if not received by
12the deadline.
   133.  A claim against the dissolved corporation is barred if
14any of the following occurs:
   15a.  A claimant who was given written notice under subsection
162 does not deliver the claim to the dissolved corporation by
17the deadline.
   18b.  A claimant whose claim was rejected by the dissolved
19corporation does not commence a proceeding to enforce the claim
20within ninety days after the rejection notice is effective.
   214.  As used in this section, “claim” does not include a
22contingent liability or a claim based on an event occurring
23after the effective date of dissolution.
24   Sec. 176.  Section 490.1407, Code 2020, is amended by
25striking the section and inserting in lieu thereof the
26following:
   27490.1407  Other claims against dissolved corporation.
   281.  A dissolved corporation may publish notice of its
29dissolution and request that persons with claims against the
30dissolved corporation present them in accordance with the
31notice.
   322.  The notice must meet all of the following requirements:
   33a.  Be published in compliance with any of the following:
   34(1)  One time in a newspaper of general circulation in the
35county where the dissolved corporation’s principal office, or,
-208-1if none in this state, its registered office, is or was last
2located.
   3(2)  Be posted conspicuously for at least thirty days on the
4dissolved corporation’s internet site.
   5b.  Describe the information that must be included in a claim
6and provide a mailing address where the claim may be sent.
   7c.  State that a claim against the dissolved corporation will
8be barred unless a proceeding to enforce the claim is commenced
9within three years after the publication of the notice.
   103.  If the dissolved corporation publishes a notice in
11accordance with subsection 2, the claim of each of the
12following claimants is barred unless the claimant commences
13a proceeding to enforce the claim against the dissolved
14corporation within three years after the publication date of
15the notice:
   16a.  A claimant who was not given written notice under section
17490.1406.
   18b.  A claimant whose claim was timely sent to the dissolved
19corporation but not acted on by the corporation.
   20c.  A claimant whose claim is contingent or based on an event
21occurring after the effective date of dissolution.
   224.  A claim that is not barred by section 490.1406,
23subsection 2, or subsection 3 of this section, may be enforced
24in any of the following ways:
   25a.  Against the dissolved corporation, to the extent of its
26undistributed assets.
   27b.  Except as provided in section 490.1408, subsection 4,
28if the assets have been distributed in liquidation, against
29a shareholder of the dissolved corporation to the extent of
30the shareholder’s pro rata share of the claim or the corporate
31assets distributed to the shareholder in liquidation, whichever
32is less, but a shareholder’s total liability for all claims
33under this section shall not exceed the total amount of assets
34distributed to the shareholder in liquidation.
35   Sec. 177.  Section 490.1409, Code 2020, is amended by
-209-1striking the section and inserting in lieu thereof the
2following:
   3490.1409  Director duties.
   41.  Directors shall cause the dissolved corporation to
5discharge or make reasonable provision for the payment of
6claims and make distributions in liquidation of assets to
7shareholders after payment or provision for claims.
   82.  Directors of a dissolved corporation which has disposed
9of claims under section 490.1406, 490.1407, or 490.1408 shall
10not be liable for breach of subsection 1 with respect to claims
11against the dissolved corporation that are barred or satisfied
12under section 490.1406, 490.1407, or 490.1408.
13   Sec. 178.  Section 490.1420, Code 2020, is amended by
14striking the section and inserting in lieu thereof the
15following:
   16490.1420  Grounds for administrative dissolution.
   17The secretary of state may commence a proceeding under
18section 490.1421 to dissolve a corporation administratively,
19if any of the following apply:
   201.  The corporation does not pay within sixty days after they
21are due any fees, taxes, interest, or penalties imposed by this
22chapter or other laws of this state.
   232.  The corporation does not deliver its biennial report
24required by section 490.1622 to the secretary of state within
25sixty days after it is due.
   263.  The corporation is without a registered agent or
27registered office in this state for sixty days or more.
   284.  The secretary of state has not been notified within sixty
29days that the corporation’s registered agent or registered
30office has been changed, that its registered agent has
31resigned, or that its registered office has been discontinued.
   325.  The corporation’s period of duration stated in its
33articles of incorporation expires.
34   Sec. 179.  Section 490.1421, Code 2020, is amended by
35striking the section and inserting in lieu thereof the
-210-1following:
   2490.1421  Procedure for and effect of administrative
3dissolution.
   41.  If the secretary of state determines that one or
5more grounds exist under section 490.1420 for dissolving a
6corporation, the secretary of state shall serve the corporation
7with written notice of such determination under section
8490.504.
   92.  If the corporation does not correct each ground for
10dissolution or demonstrate to the reasonable satisfaction of
11the secretary of state that each ground determined by the
12secretary of state does not exist within sixty days after
13service of the notice under section 490.504, the secretary
14of state shall administratively dissolve the corporation by
15signing a certificate of dissolution that recites the ground or
16grounds for dissolution and its effective date. The secretary
17of state shall file the original of the certificate and serve a
18copy on the corporation under section 490.504.
   193.  A corporation administratively dissolved continues
20its corporate existence but shall not carry on any business
21except that necessary to wind up and liquidate its business
22and affairs under section 490.1405 and notify claimants under
23sections 490.1406 and 490.1407.
   244.  The administrative dissolution of a corporation does not
25terminate the authority of its registered agent.
26   Sec. 180.  Section 490.1422, Code 2020, is amended by
27striking the section and inserting in lieu thereof the
28following:
   29490.1422  Reinstatement following administrative dissolution.
   301.  A corporation administratively dissolved under section
31490.1421 may apply to the secretary of state for reinstatement
32at any time after the effective date of dissolution. The
33application must meet all of the following requirements:
   34a.  State the name of the corporation at its date of
35dissolution and the effective date of its administrative
-211-1dissolution.
   2b.  State that the ground or grounds for dissolution either
3did not exist or have been eliminated.
   4c.  If the application is received more than five years after
5the effective date of dissolution, state a corporate name that
6satisfies the requirements of section 490.401.
   7d.  State the federal tax identification number of the
8corporation.
   92.  a.  The secretary of state shall refer the federal
10tax identification number contained in the application for
11reinstatement to the departments of revenue and workforce
12development. The departments of revenue and workforce
13development shall report to the secretary of state the tax
14status of the corporation. If either department reports to
15the secretary of state that a filing delinquency or liability
16exists against the corporation, the secretary of state shall
17not cancel the certificate of dissolution until the filing
18delinquency or liability is satisfied.
   19b.  (1)  If the secretary of state determines that the
20application contains the information required by subsection
211, and that a delinquency or liability reported pursuant to
22paragraph “a” has been satisfied, and that the information is
23correct, the secretary of state shall cancel the certificate
24of dissolution and prepare a certificate of reinstatement
25that recites the secretary of state’s determination and the
26effective date of reinstatement, file the certificate of
27reinstatement, and deliver a copy to the corporation under
28section 490.504.
   29(2)  If the corporate name in subsection 1, paragraph “c”, is
30different from the corporate name in subsection 1, paragraph
31“a”, the certificate of reinstatement shall constitute an
32amendment to the articles of incorporation insofar as it
33pertains to the corporate name. A corporation shall not
34relinquish the right to retain its corporate name if the
35reinstatement is effective within five years of the effective
-212-1date of the corporation’s dissolution.
   23.  When the reinstatement is effective, it relates back to
3and takes effect as of the effective date of the administrative
4dissolution as if the administrative dissolution had never
5occurred.
6   Sec. 181.  Section 490.1423, Code 2020, is amended by
7striking the section and inserting in lieu thereof the
8following:
   9490.1423  Appeal from denial of reinstatement.
   101.  If the secretary of state denies a corporation’s
11application for reinstatement following administrative
12dissolution, the secretary of state shall serve the corporation
13under section 490.504 with a written notice that explains the
14reason or reasons for denial.
   152.  The corporation may appeal the denial of reinstatement
16to the district court of the county where the corporation’s
17principal office or, if none in this state, its registered
18office, is located within thirty days after service of
19the notice of denial is effected. The corporation appeals
20by petitioning the court to set aside the dissolution and
21attaching to the petition copies of the secretary of state’s
22certificate of dissolution, the corporation’s application for
23reinstatement, and the secretary of state’s notice of denial.
   243.  The court may summarily order the secretary of state to
25reinstate the dissolved corporation or may take other action
26the court considers appropriate.
   274.  The court’s final decision may be appealed as in other
28civil proceedings.
29   Sec. 182.  Section 490.1430, Code 2020, is amended by
30striking the section and inserting in lieu thereof the
31following:
   32490.1430  Grounds for judicial dissolution.
   331.  The district court may dissolve a corporation in any of
34the following ways:
   35a.  A proceeding by the attorney general if it is established
-213-1that any of the following apply:
   2(1)  The corporation obtained its articles of incorporation
3through fraud.
   4(2)  The corporation has continued to exceed or abuse the
5authority conferred upon it by law.
   6b.  A proceeding by a shareholder if it is established that
7any of the following conditions exist:
   8(1)  The directors are deadlocked in the management of
9the corporate affairs, the shareholders are unable to break
10the deadlock, and irreparable injury to the corporation is
11threatened or being suffered, or the business and affairs of
12the corporation can no longer be conducted to the advantage of
13the shareholders generally, because of the deadlock.
   14(2)  The directors or those in control of the corporation
15have acted, are acting, or will act in a manner that is
16illegal, oppressive, or fraudulent.
   17(3)  The shareholders are deadlocked in voting power and have
18failed, for a period that includes at least two consecutive
19annual meeting dates, to elect successors to directors whose
20terms have expired.
   21(4)  The corporate assets are being misapplied or wasted.
   22c.  A proceeding by a creditor if it is established that any
23of the following applies:
   24(1)  The creditor’s claim has been reduced to judgment,
25the execution on the judgment returned unsatisfied, and the
26corporation is insolvent.
   27(2)  The corporation has admitted in writing that the
28creditor’s claim is due and owing and the corporation is
29insolvent.
   30d.  A proceeding by the corporation to have its voluntary
31dissolution continued under court supervision.
   32e.  A proceeding by a shareholder if the corporation has
33abandoned its business and has failed within a reasonable time
34to liquidate and distribute its assets and dissolve.
   352.  Subsection 1, paragraph “b”, shall not apply in the
-214-1case of a corporation that, on the date of the filing of the
2proceeding, has a class or series of shares which is any of the
3following:
   4a.  A covered security under section 18(b)(1)(A) or (B) of
5the federal Securities Act of 1933.
   6b.  Not a covered security, but is held by at least three
7hundred shareholders and the shares outstanding have a market
8value of at least twenty million dollars, exclusive of the
9value of such shares held by the corporation’s subsidiaries,
10senior executives, directors, and if they own more than ten
11percent of such shares, beneficial shareholders, and voting
12trust beneficial owners.
   133.  a.  As used in subsection 1, “shareholder” means a record
14shareholder, a beneficial shareholder, and an unrestricted
15voting trust beneficial owner.
   16b.  As used in subsection 2, “shareholder” means a record
17shareholder, a beneficial shareholder, and a voting trust
18beneficial owner.
19   Sec. 183.  Section 490.1431, Code 2020, is amended by
20striking the section and inserting in lieu thereof the
21following:
   22490.1431  Procedure for judicial dissolution.
   231.  Venue for a proceeding by the attorney general
24to dissolve a corporation lies in Polk county. Venue
25for a proceeding brought by any other party named in
26section 490.1430, subsection 1, lies in the county where a
27corporation’s principal office or, if none in this state, its
28registered office is or was last located.
   292.  It is not necessary to make shareholders parties to a
30proceeding to dissolve a corporation unless relief is sought
31against them individually.
   323.  A court in a proceeding brought to dissolve a corporation
33may issue injunctions, appoint a receiver or custodian during
34the proceeding with all powers and duties the court directs,
35take other action required to preserve the corporate assets
-215-1wherever located, and carry on the business of the corporation
2until a full hearing can be held.
   34.  Within ten days of the commencement of a proceeding
4to dissolve a corporation under section 490.1430, subsection
51, paragraph “b”, the corporation shall deliver to all
6shareholders, other than the petitioner, a notice stating that
7the shareholders are entitled to avoid the dissolution of the
8corporation by electing to purchase the petitioner’s shares
9under section 490.1434, and accompanied by a copy of section
10490.1434.
11   Sec. 184.  Section 490.1432, Code 2020, is amended by
12striking the section and inserting in lieu thereof the
13following:
   14490.1432  Receivership or custodianship.
   151.  Unless an election to purchase has been filed under
16section 490.1434, a court in a judicial proceeding brought to
17dissolve a corporation may appoint one or more receivers to
18wind up and liquidate, or one or more custodians to manage,
19the business and affairs of the corporation. The court shall
20hold a hearing, after notifying all parties to the proceeding
21and any interested persons designated by the court, before
22appointing a receiver or custodian. The court appointing a
23receiver or custodian has jurisdiction over the corporation and
24all of its property wherever located.
   252.  The court may appoint an individual or a domestic
26or foreign corporation or eligible entity as a receiver or
27custodian, which, if a foreign corporation or foreign eligible
28entity, must be registered to do business in this state. The
29court may require the receiver or custodian to post bond, with
30or without sureties, in an amount the court directs.
   313.  The court shall describe the powers and duties of the
32receiver or custodian in its appointing order, which may be
33amended from time to time. Among other powers all of the
34following apply:
   35a.  The receiver may do any or all of the following:
-216-   1(1)  Dispose of all or any part of the assets of the
2corporation wherever located, at a public or private sale.
   3(2)  Sue and defend in the receiver’s own name as receiver of
4the corporation in all courts of this state.
   5b.  The custodian may exercise all of the powers of the
6corporation, through or in place of its board of directors, to
7the extent necessary to manage the affairs of the corporation
8in the best interests of its shareholders and creditors.
   9c.  The receiver or custodian shall have such other powers
10and duties as the court may provide in the appointing order,
11which may be amended from time to time.
   124.  The court during a receivership may redesignate the
13receiver a custodian and during a custodianship may redesignate
14the custodian a receiver.
   155.  The court from time to time during the receivership or
16custodianship may order compensation paid and expenses paid or
17reimbursed to the receiver or custodian from the assets of the
18corporation or proceeds from the sale of the assets.
19   Sec. 185.  Section 490.1434, Code 2020, is amended by
20striking the section and inserting in lieu thereof the
21following:
   22490.1434  Election to purchase in lieu of dissolution.
   231.  In a proceeding under section 490.1430, subsection 1,
24paragraph “b”, to dissolve a corporation, the corporation
25may elect or, if it fails to elect, one or more shareholders
26may elect to purchase all shares owned by the petitioning
27shareholder at the fair value of the shares. An election
28pursuant to this section shall be irrevocable unless the court
29determines that it is equitable to set aside or modify the
30election.
   312.  An election to purchase pursuant to this section may
32be filed with the court at any time within ninety days after
33the filing of the petition under section 490.1430, subsection
341, paragraph “b”, or at such later time as the court in its
35discretion may allow. If the election to purchase is filed
-217-1by one or more shareholders, the corporation shall, within
2ten days thereafter, give written notice to all shareholders,
3other than the petitioner. The notice must state the name
4and number of shares owned by the petitioner and the name and
5number of shares owned by each electing shareholder and must
6advise the recipients of their right to join in the election to
7purchase shares in accordance with this section. Shareholders
8who wish to participate shall file notice of their intention
9to join in the purchase no later than thirty days after
10the effectiveness of the notice to them. All shareholders
11who have filed an election or notice of their intention to
12participate in the election to purchase thereby become parties
13to the proceeding and shall participate in the purchase in
14proportion to their ownership of shares as of the date the
15first election was filed, unless they otherwise agree or the
16court otherwise directs. After an election has been filed by
17the corporation or one or more shareholders, the proceeding
18under section 490.1430, subsection 1, paragraph “b”, shall
19not be discontinued or settled, nor shall the petitioning
20shareholder sell or otherwise dispose of the shareholder’s
21shares, unless the court determines that it would be equitable
22to the corporation and the shareholders, other than the
23petitioner, to permit such discontinuance, settlement, sale, or
24other disposition.
   253.  If, within sixty days of the filing of the first
26election, the parties reach agreement as to the fair value
27and terms of purchase of the petitioner’s shares, the court
28shall enter an order directing the purchase of the petitioner’s
29shares upon the terms and conditions agreed to by the parties.
   304.  If the parties are unable to reach an agreement as
31provided for in subsection 3, the court, upon application of
32any party, shall stay the proceedings under section 490.1430,
33subsection 1, paragraph “b”, and determine the fair value of
34the petitioner’s shares as of the day before the date on which
35the petition under section 490.1430, subsection 1, paragraph
-218-1“b”, was filed or as of such other date as the court deems
2appropriate under the circumstances.
   35.  Upon determining the fair value of the shares, the
4court shall enter an order directing the purchase upon such
5terms and conditions as the court deems appropriate, which may
6include payment of the purchase price in installments, where
7necessary in the interests of equity, provision for security
8to assure payment of the purchase price and any additional
9expenses as may have been awarded, and, if the shares are to
10be purchased by shareholders, the allocation of shares among
11them. In allocating the petitioner’s shares among holders of
12different classes or series of shares, the court should attempt
13to preserve the existing distribution of voting rights among
14holders of different classes or series insofar as practicable
15and may direct that holders of a specific class or classes or
16series shall not participate in the purchase. Interest may be
17allowed at the rate and from the date determined by the court
18to be equitable, but if the court finds that the refusal of
19the petitioning shareholder to accept an offer of payment was
20arbitrary or otherwise not in good faith, no interest shall be
21allowed. If the court finds that the petitioning shareholder
22had probable grounds for relief under section 490.1430,
23subsection 1, paragraph “b”, subparagraph (2) or (4), it may
24award expenses to the petitioning shareholder.
   256.  Upon entry of an order under subsection 3 or 5, the
26court shall dismiss the petition to dissolve the corporation
27under section 490.1430, subsection 1, paragraph “b”, and the
28petitioning shareholder shall no longer have any rights or
29status as a shareholder of the corporation, except the right
30to receive the amounts awarded by the order of the court which
31shall be enforceable in the same manner as any other judgment.
   327.  The purchase ordered pursuant to subsection 5 shall be
33made within ten days after the date the order becomes final.
   348.  Any payment by the corporation pursuant to an order under
35subsection 3 or 5, other than an award of expenses pursuant to
-219-1subsection 5, is subject to the provisions of section 490.640.
2   Sec. 186.  Section 490.1440, Code 2020, is amended by
3striking the section and inserting in lieu thereof the
4following:
   5490.1440  Deposit with state treasurer.
   6Assets of a dissolved corporation that should be transferred
7to a creditor, claimant, or shareholder of the corporation who
8cannot be found or who is not competent to receive them shall
9be reduced to cash and deposited with the treasurer of state
10or other appropriate state official for safekeeping. When the
11creditor, claimant, or shareholder furnishes satisfactory proof
12of entitlement to the amount deposited, the treasurer of state
13or other appropriate state official shall pay such person, or
14the representative of such person, that amount.
15   Sec. 187.  Section 490.1501, Code 2020, is amended by
16striking the section and inserting in lieu thereof the
17following:
   18490.1501  Governing law.
   191.  The law of the jurisdiction of formation of a foreign
20corporation governs all of the following:
   21a.  The internal affairs of the foreign corporation.
   22b.  The interest holder liability of its shareholders.
   232.  A foreign corporation is not precluded from registering
24to do business in this state because of any difference between
25the law of the foreign corporation’s jurisdiction of formation
26and the law of this state.
   273.  Registration of a foreign corporation to do business in
28this state does not permit the foreign corporation to engage in
29any business or affairs or exercise any power that a domestic
30corporation cannot lawfully engage in or exercise in this
31state.
32   Sec. 188.  Section 490.1502, Code 2020, is amended by
33striking the section and inserting in lieu thereof the
34following:
   35490.1502  Registration to do business in this state.
-220-   11.  A foreign corporation shall not do business in this
2state until it registers with the secretary of state under this
3chapter.
   42.  A foreign corporation doing business in this state shall
5not maintain a proceeding in any court of this state until it
6is registered to do business in this state.
   73.  The failure of a foreign corporation to register to
8do business in this state does not impair the validity of a
9contract or act of the foreign corporation or preclude it from
10defending a proceeding in this state.
   114.  A limitation on the liability of a shareholder or
12director of a foreign corporation is not waived solely because
13the foreign corporation does business in this state without
14registering.
   155.  Section 490.1501, subsection 1, applies even if a foreign
16corporation fails to register under this chapter.
17   Sec. 189.  Section 490.1503, Code 2020, is amended by
18striking the section and inserting in lieu thereof the
19following:
   20490.1503  Foreign registration statement.
   211.  To register to do business in this state, a foreign
22corporation shall deliver a foreign registration statement to
23the secretary of state for filing. The registration statement
24must be signed by the foreign corporation and state all of the
25following:
   26a.  The corporate name of the foreign corporation and, if the
27name does not comply with section 490.401, an alternate name as
28required by section 490.1506.
   29b.  The foreign corporation’s jurisdiction of formation.
   30c.  The street and mailing addresses of the foreign
31corporation’s principal office and, if the law of the foreign
32corporation’s jurisdiction of formation requires the foreign
33corporation to maintain an office in that jurisdiction, the
34street and mailing addresses of that office.
   35d.  The street and mailing addresses of the foreign
-221-1corporation’s registered office in this state and the name of
2its registered agent at that office.
   3e.  The names and business addresses of its directors and
4principal officers.
   52.  The foreign corporation shall deliver the completed
6foreign registration statement to the secretary of state,
7and also deliver to the secretary of state a certificate of
8existence or a document of similar import duly authenticated
9by the secretary of state or other official having custody of
10corporate records in the state or country under whose law it is
11incorporated which is dated no earlier than ninety days prior
12to the date the application is filed by the secretary of state.
13   Sec. 190.  Section 490.1504, Code 2020, is amended by
14striking the section and inserting in lieu thereof the
15following:
   16490.1504  Amendment of foreign registration statement.
   17A registered foreign corporation shall sign and deliver to
18the secretary of state for filing an amendment to its foreign
19registration statement if there is a change in any of the
20following:
   211.  Its name or alternate name.
   222.  Its jurisdiction of formation, unless its registration
23is deemed to have been withdrawn under section 490.1508 or
24transferred under section 490.1510.
   253.  An address required by section 490.1503, subsection 1,
26paragraph “c”.
27   Sec. 191.  Section 490.1505, Code 2020, is amended by
28striking the section and inserting in lieu thereof the
29following:
   30490.1505  Activities not constituting doing business.
   311.  Activities of a foreign corporation that do not
32constitute doing business in this state for purposes of this
33subchapter include all of the following:
   34a.  Maintaining, defending, mediating, arbitrating, or
35settling a proceeding.
-222-   1b.  Carrying on any activity concerning the internal affairs
2of the foreign corporation, including holding meetings of its
3shareholders or board of directors.
   4c.  Maintaining accounts in financial institutions.
   5d.  Maintaining offices or agencies for the transfer,
6exchange, and registration of securities of the foreign
7corporation or maintaining trustees or depositories with
8respect to those securities.
   9e.  Selling through independent contractors.
   10f.  Soliciting or obtaining orders by any means if the
11orders require acceptance outside this state before they become
12contracts.
   13g.  Creating or acquiring indebtedness, mortgages, or
14security interests in property.
   15h.  Securing or collecting debts or enforcing mortgages or
16security interests in property securing the debts, and holding,
17protecting, or maintaining property so acquired.
   18i.  Conducting an isolated transaction that is not in the
19course of similar transactions.
   20j.  Owning, protecting, and maintaining property.
   21k.  Doing business in interstate commerce.
   222.  This section does not apply in determining the contacts
23or activities that may subject a foreign corporation to service
24of process, taxation, or regulation under the laws of this
25state other than this chapter.
26   Sec. 192.  Section 490.1506, Code 2020, is amended by
27striking the section and inserting in lieu thereof the
28following:
   29490.1506  Noncomplying name of foreign corporation.
   301.  A foreign corporation whose name does not comply with
31section 490.401 shall not register to do business in this state
32until it adopts, for the purpose of doing business in this
33state, an alternate name that complies with section 490.401 by
34filing a foreign registration statement under section 490.1503,
35or if applicable, a transfer of registration statement under
-223-1section 490.1510, setting forth that alternate name. After
2registering to do business in this state with an alternate
3name, a foreign corporation shall do business in this state
4under any of the following:
   5a.  The alternate name.
   6b.  The foreign corporation’s name, with the addition of its
7jurisdiction of formation.
   82.  If a registered foreign corporation changes its name
9after registration to a name that does not comply with section
10490.401, it shall not do business in this state until it
11complies with subsection 1 by amending its registration
12statement to adopt an alternate name that complies with section
13490.401.
14   Sec. 193.  Section 490.1507, Code 2020, is amended by
15striking the section and inserting in lieu thereof the
16following:
   17490.1507  Withdrawal of registration of registered foreign
18corporation.
   191.  A registered foreign corporation may withdraw its
20registration by delivering a statement of withdrawal to the
21secretary of state for filing. The statement of withdrawal
22must be signed by the foreign corporation and state all of the
23following:
   24a.  The name of the foreign corporation and its jurisdiction
25of formation.
   26b.  That the foreign corporation is not doing business
27in this state and that it withdraws its registration to do
28business in this state.
   29c.  That the foreign corporation revokes the authority of its
30registered agent in this state.
   31d.  An address to which process on the foreign corporation
32may be sent by the secretary of state under section 490.504,
33subsection 3.
   342.  After the withdrawal of the registration of a foreign
35corporation, service of process in any proceeding based on
-224-1a cause of action arising during the time the entity was
2registered to do business in this state may be made as provided
3in section 490.504.
4   Sec. 194.  Section 490.1508, Code 2020, is amended by
5striking the section and inserting in lieu thereof the
6following:
   7490.1508  Deemed withdrawal upon domestication or conversion
8to certain domestic entities.
   9A registered foreign corporation that domesticates to
10a domestic business corporation or converts to a domestic
11nonprofit corporation or any type of domestic filing entity or
12to a domestic limited liability partnership is deemed to have
13withdrawn its registration on the effectiveness of such event.
14   Sec. 195.  Section 490.1509, Code 2020, is amended by
15striking the section and inserting in lieu thereof the
16following:
   17490.1509  Withdrawal upon dissolution or conversion to certain
18nonfiling entities.
   191.  A registered foreign corporation that has dissolved and
20completed winding up or has converted to a domestic or foreign
21nonfiling entity other than a limited liability partnership
22shall deliver to the secretary of state for filing a statement
23of withdrawal. The statement must be signed by the dissolved
24corporation or the converted domestic or foreign nonfiling
25entity and state:
   26a.  In the case of a foreign corporation that has completed
27winding up all of the following:
   28(1)  Its name and jurisdiction of formation.
   29(2)  That the foreign corporation withdraws its registration
30to do business in this state and revokes the authority of its
31registered agent to accept service on its behalf.
   32(3)  An address to which process on the foreign corporation
33may be sent by the secretary of state under section 490.504,
34subsection 3.
   35b.  In the case of a foreign corporation that has converted
-225-1to a domestic or foreign nonfiling entity other than a limited
2liability partnership all of the following:
   3(1)  The name of the converting foreign corporation and its
4jurisdiction of formation.
   5(2)  The type of the nonfiling entity to which it has
6converted and its name and jurisdiction of formation.
   7(3)  That it withdraws its registration to do business in
8this state and revokes the authority of its registered agent to
9accept service on its behalf.
   10(4)  An address to which process on the foreign corporation
11may be sent by the secretary of state under section 490.504,
12subsection 3.
   132.  After the withdrawal of the registration of a foreign
14corporation, service of process in any proceeding based on
15a cause of action arising during the time the entity was
16registered to do business in this state may be made as provided
17in section 490.504.
18   Sec. 196.  Section 490.1510, Code 2020, is amended by
19striking the section and inserting in lieu thereof the
20following:
   21490.1510  Transfer of registration.
   221.  If a registered foreign corporation merges into a
23nonregistered foreign corporation or converts to a foreign
24corporation required to register with the secretary of state
25to do business in this state, the foreign corporation shall
26deliver to the secretary of state for filing a transfer
27of registration statement. The transfer of registration
28statement must be signed by the surviving or converted foreign
29corporation and state all of the following:
   30a.  The name of the registered foreign corporation and its
31jurisdiction of formation before the merger or conversion.
   32b.  The name of the surviving or converted foreign
33corporation and its jurisdiction of formation after the
34merger or conversion and, if the name does not comply with
35section 490.401, an alternate name adopted pursuant to section
-226-1490.1506.
   2c.  All of the following information regarding the
3surviving or converted foreign corporation after the merger or
4conversion:
   5(1)  The street and mailing addresses of the principal
6office of the foreign corporation and, if the law of the
7foreign corporation’s jurisdiction of formation requires it to
8maintain an office in that jurisdiction, the street and mailing
9addresses of that office.
   10(2)  The street and mailing addresses of the foreign
11corporation’s registered office in this state and the name of
12its registered agent at that office.
   132.  On the effective date of a transfer of registration
14statement as determined in accordance with section 490.123,
15the registration of the registered foreign corporation to do
16business in this state is transferred without interruption to
17the foreign corporation into which it has merged or to which
18it has been converted.
19   Sec. 197.  NEW SECTION.  490.1511  Administrative termination
20of registration.
   211.  The secretary of state may terminate the registration
22of a registered foreign corporation in the manner provided in
23subsections 2 and 3, if any of the following applies:
   24a.  The foreign corporation does not pay within sixty days
25after they are due any fees, taxes, interest, or penalties
26imposed by this chapter or other laws of this state.
   27b.  The foreign corporation does not deliver its biennial
28report to the secretary of state within sixty days after it is
29due.
   30c.  The foreign corporation is without a registered agent or
31registered office in this state for sixty days or more.
   32d.  The secretary of state has not been notified within
33sixty days that the foreign corporation’s registered agent
34or registered office has been changed, that its registered
35agent has resigned, or that its registered office has been
-227-1discontinued.
   22.  The secretary of state may terminate the registration of
3a registered foreign corporation by doing all of the following:
   4a.  Filing a certificate of termination.
   5b.  Delivering a copy of the certificate of termination to
6the foreign corporation’s registered agent or, if the foreign
7corporation does not have a registered agent, to the foreign
8corporation’s principal office.
   93.  The certificate of termination must state all of the
10following:
   11a.  The effective date of the termination, which must be
12not less than sixty days after the secretary of state delivers
13the copy of the certificate of termination as prescribed in
14subsection 2, paragraph “b”.
   15b.  The grounds for termination under subsection 1.
   164.  The registration of a registered foreign corporation
17to do business in this state ceases on the effective date
18of the termination as set forth in the certificate of
19termination, unless before that date the foreign corporation
20cures each ground for termination stated in the certificate of
21termination. If the foreign corporation cures each ground, the
22secretary of state shall file a statement that the certificate
23of termination is withdrawn.
   245.  After the effective date of the termination as set forth
25in the certificate of termination, service of process in any
26proceeding based on a cause of action arising during the time
27the entity was registered to do business in this state may be
28made as provided in section 490.504.
29   Sec. 198.  NEW SECTION.  490.1512  Action by attorney general.
   30The attorney general may maintain an action to enjoin a
31foreign corporation from doing business in this state in
32violation of this chapter.
33   Sec. 199.  Section 490.1601, Code 2020, is amended by
34striking the section and inserting in lieu thereof the
35following:
-228-   1490.1601  Corporate records.
   21.  A corporation shall maintain all of the following
3records:
   4a.  Its articles of incorporation as currently in effect.
   5b.  Any notices to shareholders referred to in section
6490.120, subsection 11, paragraph “e”, specifying facts
7on which a filed document is dependent if those facts are
8not included in the articles of incorporation or otherwise
9available as specified in section 490.120, subsection 11,
10paragraph “e”.
   11c.  Its bylaws as currently in effect.
   12d.  All written communications within the past three years to
13shareholders generally.
   14e.  Minutes of all meetings of, and records of all actions
15taken without a meeting by, its shareholders, its board of
16directors, and board committees established under section
17490.825.
   18f.  A list of the names and business addresses of its current
19directors and officers.
   20g.  Its most recent biennial report delivered to the
21secretary of state under section 490.1622.
   222.  A corporation shall maintain all annual financial
23statements prepared for the corporation for its last three
24fiscal years, or such shorter period of existence, and
25any audit or other reports with respect to such financial
26statements.
   273.  A corporation shall maintain accounting records in a form
28that permits preparation of its financial statements.
   294.  A corporation shall maintain a record of its current
30shareholders in alphabetical order by class or series of shares
31showing the address of, and the number and class or series of
32shares held by, each shareholder. Nothing contained in this
33subsection shall require the corporation to include in such
34record the electronic mail address or other electronic contact
35information of a shareholder.
-229-   15.  A corporation shall maintain the records specified in
2this section in a manner so that they may be made available for
3inspection within a reasonable time.
4   Sec. 200.  Section 490.1602, Code 2020, is amended by
5striking the section and inserting in lieu thereof the
6following:
   7490.1602  Inspection rights of shareholders.
   81.  A shareholder of a corporation is entitled to inspect
9and copy, during regular business hours at the corporation’s
10principal office, any of the records of the corporation
11described in section 490.1601, subsection 1, excluding minutes
12of meetings of, and records of actions taken without a meeting
13by, the corporation’s board of directors and board committees
14established under section 490.825, if the shareholder gives
15the corporation a signed written notice of the shareholder’s
16demand at least five business days before the date on which the
17shareholder wishes to inspect and copy.
   182.  A shareholder of a corporation is entitled to inspect and
19copy, during regular business hours at a reasonable location
20specified by the corporation, any of the following records of
21the corporation if the shareholder meets the requirements of
22subsection 3 and gives the corporation a signed written notice
23of the shareholder’s demand at least five business days before
24the date on which the shareholder wishes to inspect and copy
25any of the following:
   26a.  The financial statements of the corporation maintained in
27accordance with section 490.1601, subsection 2.
   28b.  Accounting records of the corporation.
   29c.  Excerpts from minutes of any meeting of, or records of
30any actions taken without a meeting by, the corporation’s board
31of directors and board committees maintained in accordance with
32section 490.1601, subsection 1.
   33d.  The record of shareholders maintained in accordance with
34section 490.1601, subsection 4.
   353.  A shareholder may inspect and copy the records described
-230-1in subsection 2 only if all of the following apply:
   2a.  The shareholder’s demand is made in good faith and for
3a proper purpose.
   4b.  The shareholder’s demand describes with reasonable
5particularity the shareholder’s purpose and the records the
6shareholder desires to inspect.
   7c.  The records are directly connected with the shareholder’s
8purpose.
   94.  The corporation may impose reasonable restrictions on
10the confidentiality, use, or distribution of records described
11in subsection 2.
   125.  For any meeting of shareholders for which the record date
13for determining shareholders entitled to vote at the meeting
14is different from the record date for notice of the meeting,
15any person who becomes a shareholder subsequent to the record
16date for notice of the meeting and is entitled to vote at
17the meeting is entitled to obtain from the corporation upon
18request the notice and any other information provided by the
19corporation to shareholders in connection with the meeting,
20unless the corporation has made such information generally
21available to shareholders by posting it on its internet site or
22by other generally recognized means. Failure of a corporation
23to provide such information does not affect the validity of
24action taken at the meeting.
   256.  The right of inspection granted by this section shall
26not be abolished or limited by a corporation’s articles of
27incorporation or bylaws.
   287.  This section does not affect any of the following:
   29a.  The right of a shareholder to inspect records under
30section 490.720 or, if the shareholder is in litigation with
31the corporation, to the same extent as any other litigant.
   32b.  The power of a court, independently of this chapter,
33to compel the production of corporate records for examination
34and to impose reasonable restrictions as provided in section
35490.1604, subsection 3, provided that, in the case of
-231-1production of records described in subsection 2, at the request
2of a shareholder, the shareholder has met the requirements of
3subsection 3.
   48.  As used in this section, “shareholder” means a record
5shareholder, a beneficial shareholder, and an unrestricted
6voting trust beneficial owner.
7   Sec. 201.  Section 490.1603, Code 2020, is amended by
8striking the section and inserting in lieu thereof the
9following:
   10490.1603  Scope of inspection right.
   111.  A shareholder may appoint an agent or attorney to
12exercise the shareholder’s inspection and copying rights under
13section 490.1602.
   142.  The corporation may, if reasonable, satisfy the right
15of a shareholder to copy records under section 490.1602 by
16furnishing to the shareholder copies by photocopy or other
17means chosen by the corporation, including furnishing copies
18through an electronic transmission.
   193.  The corporation may comply at its expense with a
20shareholder’s demand to inspect the record of shareholders
21under section 490.1602, subsection 2, paragraph “d”, by
22providing the shareholder with a list of shareholders that was
23compiled no earlier than the date of the shareholder’s demand.
   244.  The corporation may impose a reasonable charge to cover
25the costs of providing copies of documents to the shareholder,
26which may be based on an estimate of such costs.
27   Sec. 202.  Section 490.1604, Code 2020, is amended by
28striking the section and inserting in lieu thereof the
29following:
   30490.1604  Court-ordered inspection.
   311.  If a corporation does not allow a shareholder who
32complies with section 490.1602, subsection 1, to inspect and
33copy any records required by that section to be available
34for inspection, the district court of the county where the
35corporation’s principal office or, if none in this state, its
-232-1registered office, is located, may summarily order inspection
2and copying of the records demanded at the corporation’s
3expense upon application of the shareholder.
   42.  If a corporation does not within a reasonable time allow
5a shareholder who complies with section 490.1602, subsection
62, to inspect and copy the records required by that section,
7the shareholder who complies with section 490.1602, subsection
83, may apply to the district court in the county where the
9corporation’s principal office or, if none in this state, its
10registered office, is located for an order to permit inspection
11and copying of the records demanded. The court shall dispose
12of an application under this subsection on an expedited basis.
   133.  If the court orders inspection and copying of the
14records demanded under section 490.1602, subsection 2, it
15may impose reasonable restrictions on their confidentiality,
16use, or distribution by the demanding shareholder and it
17shall also order the corporation to pay the shareholder’s
18expenses incurred to obtain the order, unless the corporation
19establishes that it refused inspection in good faith because
20of any of the following:
   21a.  The corporation had a reasonable basis for doubt about
22the right of the shareholder to inspect the records demanded.
   23b.  The corporation required reasonable restrictions on the
24confidentiality, use, or distribution of the records demanded
25to which the demanding shareholder had been unwilling to agree.
26   Sec. 203.  Section 490.1605, Code 2020, is amended by
27striking the section and inserting in lieu thereof the
28following:
   29490.1605  Inspection of records by directors.
   301.  A director of a corporation is entitled to inspect and
31copy the books, records, and documents of the corporation at
32any reasonable time to the extent reasonably related to the
33performance of the director’s duties as a director, including
34duties as a member of a board committee, but not for any other
35purpose or in any manner that would violate any duty to the
-233-1corporation.
   22.  The district court of the county where the corporation’s
3principal office, or if none in this state, its registered
4office, is located may order inspection and copying of the
5books, records, and documents at the corporation’s expense,
6upon application of a director who has been refused such
7inspection rights, unless the corporation establishes that the
8director is not entitled to such inspection rights. The court
9shall dispose of an application under this subsection on an
10expedited basis.
   113.  If an order is issued, the court may include provisions
12protecting the corporation from undue burden or expense, and
13prohibiting the director from using information obtained upon
14exercise of the inspection rights in a manner that would
15violate a duty to the corporation, and may also order the
16corporation to reimburse the director for the director’s
17expenses incurred in connection with the application.
18   Sec. 204.  Section 490.1620, Code 2020, is amended by
19striking the section and inserting in lieu thereof the
20following:
   21490.1620  Financial statements for shareholders.
   221.  Upon the written request of a shareholder, a corporation
23shall deliver or make available to such requesting shareholder
24by posting on its internet site or by other generally
25recognized means annual financial statements for the most
26recent fiscal year of the corporation for which annual
27financial statements have been prepared for the corporation.
28If financial statements have been prepared for the corporation
29on the basis of generally accepted accounting principles
30for such specified period, the corporation shall deliver or
31make available such financial statements to the requesting
32shareholder. If the annual financial statements to be
33delivered or made available to the requesting shareholder are
34audited or otherwise reported upon by a public accountant,
35the report shall also be delivered or made available to the
-234-1requesting shareholder.
   22.  A corporation shall deliver, or make available and
3provide written notice of availability of, the financial
4statements required under subsection 1 to the requesting
5shareholder within five business days of delivery of such
6written request to the corporation.
   73.  A corporation may fulfill its responsibilities under
8this section by delivering the specified financial statements,
9or otherwise making them available, in any manner permitted by
10the applicable rules and regulations of the federal securities
11and exchange commission.
   124.  Notwithstanding the provisions of subsections 1, 2, and
133, all of the following apply:
   14a.  As a condition to delivering or making available
15financial statements to a requesting shareholder, the
16corporation may require the requesting shareholder to agree
17to reasonable restrictions on the confidentiality, use, and
18distribution of such financial statements.
   19b.  The corporation may, if it reasonably determines that the
20shareholder’s request is not made in good faith or for a proper
21purpose, decline to deliver or make available such financial
22statements to that shareholder.
   235.  If a corporation does not respond to a shareholder’s
24request for annual financial statements pursuant to this
25section in accordance with subsection 2 within five business
26days of delivery of such request to the corporation all of the
27following shall apply:
   28a.  The requesting shareholder may apply to the district
29court of the county where the corporation’s principal
30office, or if none in this state, its registered office, is
31located for an order requiring delivery of or access to the
32requested financial statements. The court shall dispose of an
33application under this subsection on an expedited basis.
   34b.  If the court orders delivery or access to the requested
35financial statements, it may impose reasonable restrictions on
-235-1their confidentiality, use, or distribution.
   2c.  In such proceeding, if the corporation has declined to
3deliver or make available such financial statements because
4the shareholder had been unwilling to agree to restrictions
5proposed by the corporation on the confidentiality, use, and
6distribution of such financial statements, the corporation
7shall have the burden of demonstrating that the restrictions
8proposed by the corporation were reasonable.
   9d.  In such proceeding, if the corporation has declined to
10deliver or make available such financial statements pursuant
11to subsection 4, paragraph “b”, the corporation shall have the
12burden of demonstrating that it had reasonably determined that
13the shareholder’s request was not made in good faith or for a
14proper purpose.
   15e.  If the court orders delivery or access to the requested
16financial statements it shall order the corporation to pay the
17shareholder’s expenses incurred to obtain such order unless
18the corporation establishes that it had refused delivery or
19access to the requested financial statements because the
20shareholder had refused to agree to reasonable restrictions
21on the confidentiality, use, or distribution of the financial
22statements or that the corporation had reasonably determined
23that the shareholder’s request was not made in good faith or
24for a proper purpose.
25   Sec. 205.  Section 490.1622, Code 2020, is amended by
26striking the section and inserting in lieu thereof the
27following:
   28490.1622  Biennial report for secretary of state.
   291.  Each domestic corporation shall deliver to the secretary
30of state for filing a biennial report that sets forth all of
31the following:
   32a.  The name of the corporation.
   33b.  The street and mailing addresses of its registered office
34and the name of its registered agent at that office in this
35state.
-236-   1c.  The street and mailing addresses of its principal office.
   2d.  The names and business addresses of the president,
3secretary, treasurer, and one of the board of directors.
   42.  Each foreign corporation registered to do business in
5this state shall deliver to the secretary of state for filing a
6biennial report that sets forth all of the following:
   7a.  The name of the foreign corporation and, if the name does
8not comply with section 490.401, an alternate name as required
9by section 490.1506.
   10b.  The foreign corporation’s jurisdiction of formation.
   11c.  The street and mailing addresses of the foreign
12corporation’s principal office and, if the law of the foreign
13corporation’s jurisdiction of formation requires the foreign
14corporation to maintain an office in that jurisdiction, the
15street and mailing addresses of that office.
   16d.  The street and mailing addresses of the foreign
17corporation’s registered office in this state and the name of
18its registered agent at that office.
   19e.  The names and business addresses of the president,
20secretary, treasurer, and one of the board of directors.
   213.  Information in the biennial report must be current as
22of the date the biennial report is signed on behalf of the
23corporation. The report shall be executed on behalf of the
24corporation and signed as provided in section 490.120 or by
25any other person authorized by the board of directors of the
26corporation.
   274.  The first biennial report shall be delivered to the
28secretary of state between January 1 and April 1 of the first
29even-numbered year following the calendar year in which a
30domestic corporation was incorporated or a foreign corporation
31was authorized to transact business. Subsequent biennial
32reports must be delivered to the secretary of state between
33January 1 and April 1 of the following even-numbered calendar
34years. For purposes of this section, each biennial report
35shall contain information related to the two-year period
-237-1immediately preceding the calendar year in which the report is
2filed.
   35.  If a biennial report does not contain the information
4required by this section, the secretary of state shall promptly
5notify the reporting domestic or foreign corporation in writing
6and return the report to it for correction. If the report is
7corrected to contain the information required by this section
8and delivered to the secretary of state within thirty days
9after the notice from the secretary of state becomes effective
10as determined in accordance with section 490.141, it is deemed
11to be timely filed.
   126.  The secretary of state may provide for the change of
13registered office or registered agent on the form prescribed by
14the secretary of state for the biennial report, provided that
15the form contains the information required in section 490.502.
16If the secretary of state determines that a biennial report
17does not contain the information required by this section but
18otherwise meets the requirements of section 490.502 for the
19purpose of changing the registered office or registered agent,
20the secretary of state shall file the statement of change of
21registered office or registered agent, effective as provided in
22section 490.123, before returning the biennial report to the
23corporation as provided in this section. A statement of change
24of registered office or agent pursuant to this subsection shall
25be executed by a person authorized to execute the biennial
26report.
27   Sec. 206.  Section 490.1701, Code 2020, is amended by
28striking the section and inserting in lieu thereof the
29following:
   30490.1701  Application of subchapter — definitions.
   311.  If a corporation elects to become a benefit corporation
32under this subchapter in the manner prescribed in this
33subchapter, it is subject in all respects to the provisions
34of this chapter, except to the extent this subchapter imposes
35additional or different requirements, in which case such
-238-1requirements apply. The inclusion of a provision in this
2subchapter does not imply that a contrary or different rule of
3law applies to a corporation that is not a benefit corporation.
4This subchapter does not affect a statute or rule of law that
5applies to a corporation that is not a benefit corporation.
   62.  As used in this subchapter:
   7a.  “Benefit corporation” means a corporation that includes
8in its articles of incorporation a statement that the
9corporation is subject to this subchapter.
   10b.  “Public benefit” means a positive effect, or reduction of
11negative effects, on one or more communities or categories of
12persons or entities, other than shareholders solely in their
13capacity as shareholders, or on the environment, including
14effects of an artistic, charitable, economic, educational,
15cultural, literary, medical, religious, social, ecological, or
16scientific nature.
   17c.  “Public benefit provision” means a provision in the
18articles of incorporation which states that the corporation
19shall pursue one or more identified public benefits.
   20d.  “Responsible and sustainable manner” means a manner that
21does all of the following:
   22(1)  Pursues through the business of the corporation the
23creation of a positive effect on society and the environment,
24taken as a whole, that is material taking into consideration
25the corporation’s size and the nature of its business.
   26(2)  Considers, in addition to the interests of
27shareholders, the interests of stakeholders known to be
28affected by the conduct of the business of the corporation.
29   Sec. 207.  Section 490.1702, Code 2020, is amended by
30striking the section and inserting in lieu thereof the
31following:
   32490.1702  Name — share certificates.
   331.  The name of a benefit corporation may contain the
34words “benefit corporation”, the abbreviation “B.C.”, or the
35designation “BC”, any of which shall be deemed to satisfy the
-239-1requirements of section 490.401, subsection 1, paragraph “a”.
   22.  Any share certificate issued by a benefit corporation,
3and any information statement delivered by a benefit
4corporation pursuant to section 490.626, subsection 2,
5must note conspicuously that the corporation is a benefit
6corporation subject to this subchapter.
7   Sec. 208.  Section 490.1703, Code 2020, is amended by
8striking the section and inserting in lieu thereof the
9following:
   10490.1703  Certain amendments and transactions — votes
11required.
   121.  Unless the articles of incorporation or bylaws require
13a greater vote, the approval of at least two-thirds of the
14voting power of the outstanding shares of the corporation
15entitled to vote thereon, and, if any class or series of shares
16is entitled to vote as a separate group on any such amendment
17or transaction, the approval of at least two-thirds of the
18outstanding shares of each such separate voting group entitled
19to vote thereon, shall be required for a corporation that is
20not a benefit corporation to do any of the following:
   21a.  Amend its articles of incorporation to include a
22statement that it is subject to this subchapter.
   23b.  Merge with or into, or enter into a share exchange with,
24another entity, or effect a domestication or conversion, if,
25as a result of the merger, share exchange, domestication, or
26conversion, the shares of any voting group would become, or be
27converted into or exchanged for the right to receive, shares
28of a benefit corporation or shares or interests in an entity
29subject to provisions of organic law analogous to those in
30this subchapter; provided, however, that in the case of this
31paragraph “b”, if the shares of one or more, but not all,
32voting groups are so affected, then only the shares in the
33voting groups so affected shall be entitled to vote under this
34subsection.
   352.  Unless the articles of incorporation or bylaws require a
-240-1greater vote, the approval of at least two-thirds of the voting
2power of the outstanding shares of the corporation entitled
3to vote thereon and, if any class or series of shares is
4entitled to vote as a separate group on any such amendment or
5transaction, the approval of at least two-thirds of the voting
6power of the outstanding shares of each such separate voting
7group, shall be required for a benefit corporation to do any
8of the following:
   9a.  Amend its articles of incorporation to eliminate a
10statement that the corporation is subject to this subchapter.
   11b.  Merge with or into, or enter into a share exchange with,
12another entity, or effect a domestication or conversion if,
13as a result of the merger, share exchange, domestication, or
14conversion, the shares of any voting group would become, or be
15converted into or exchanged for the right to receive, shares or
16interests in an entity that is neither a benefit corporation
17nor an entity subject to provisions of organic law analogous to
18those in this subchapter; provided, however, that in the case
19of this paragraph “b”, if the shares of one or more, but not
20all, voting groups are so affected, then only the shares in the
21voting groups so affected shall be entitled to vote under this
22subsection.
   233.  The vote required under subsections 1 and 2 is in
24addition to any vote otherwise required under this chapter.
25   Sec. 209.  NEW SECTION.  490.1704  Duties of directors.
   261.  Each member of the board of directors of a benefit
27corporation, when discharging the duties of a director, shall
28act according to all of the following:
   29a.  In a responsible and sustainable manner.
   30b.  In a manner that pursues the public benefit or benefits
31identified in any public benefit provision.
   322.  In fulfilling the duties under subsection 1, a director
33shall consider, to the extent affected, in addition to the
34interests of shareholders generally, the separate interests
35of stakeholders known to be affected by the business of the
-241-1corporation including all of the following:
   2a.  The employees and workforces of the corporation, its
3subsidiaries, and its suppliers.
   4b.  Customers.
   5c.  Communities or society, including those of each community
6in which offices or facilities of the corporation, its
7subsidiaries, or its suppliers are located.
   8d.  The local and global environment.
   93.  A director of a benefit corporation shall not, by virtue
10of the duties imposed by subsections 1 and 2, owe any duty to a
11person other than the benefit corporation due to any interest
12of the person in the status of the corporation as a benefit
13corporation or in any public benefit provision.
   144.  Unless otherwise provided in the articles of
15incorporation, the violation by a director of the duties
16imposed by subsections 1 and 2 shall not constitute an
17intentional infliction of harm on the corporation or the
18shareholders for the purposes of sections 490.202, subsection
192, paragraphs “d” and “e”.
20   Sec. 210.  NEW SECTION.  490.1705  Annual benefit report.
   211.  No less than annually, a benefit corporation shall
22prepare a benefit report addressing the efforts of the
23corporation during the preceding year to operate in a
24responsible and sustainable manner, to pursue any public
25benefit or benefits identified in any public benefit provision,
26and to consider the interests described in section 490.1704,
27subsection 2. The annual benefit report must include all of
28the following:
   29a.  The objectives that the board of directors has
30established for the corporation to operate in a responsible and
31sustainable manner, to pursue any public benefit or benefits
32identified in any public benefit provision, and to consider the
33interests described in section 490.1704, subsection 2.
   34b.  The standards the board of directors has adopted
35to measure the corporation’s progress in operating in a
-242-1responsible and sustainable manner, in pursuing the public
2benefit or benefits identified in any public benefit provision,
3and in considering the interests described in section 490.1704,
4subsection 2.
   5c.  If the articles of incorporation or bylaws require
6that the corporation use an independent third-party standard
7in reporting on the corporation’s progress in operating in a
8responsible and sustainable manner, in pursuing any public
9benefit or benefits identified in any public benefit provision,
10or in considering the interests described in section 490.1704,
11subsection 2, or if the board of directors has chosen to use
12such a standard, the applicable standard so required or chosen.
   13d.  An assessment of the corporation’s success in meeting
14the objectives and standards identified in paragraphs “a” and
15“b”, and, if applicable, paragraph “c”, and the basis for that
16assessment.
   172.  The benefit corporation shall deliver to each
18shareholder, or make available and provide written notice to
19each shareholder of the availability of, the annual benefit
20report required by subsection 1 on or before the earlier of the
21following:
   22a.  One hundred twenty days following the end of the fiscal
23year of the benefit corporation.
   24b.  The time that the benefit corporation delivers any
25other annual reports or annual financial statements to its
26shareholders.
   273.  Any shareholder that has not received or been given
28access to an annual benefit report within the time required by
29subsection 2 may make a written request that the corporation
30deliver or make available the annual benefit report to the
31shareholder. If a benefit corporation does not deliver or make
32available an annual benefit report to the shareholder within
33five business days of receiving such request, the requesting
34shareholder may apply to the district court of the county
35where the corporation’s principal office or, if none in this
-243-1state, its registered office, is located for an order requiring
2delivery of or access to the annual benefit report. The court
3shall dispose of an action under this subsection 3 on an
4expedited basis.
   54.  A benefit corporation shall post all of its annual
6benefit reports on the public portion of its internet site,
7if any. If a benefit corporation does not have an internet
8site, the benefit corporation shall provide a copy of its most
9recent annual benefit report, without charge, to any person
10that requests a copy in writing.
11   Sec. 211.  NEW SECTION.  490.1706  Rights of action.
   121.  Except in a proceeding authorized under section
13490.1705, subsection 3, or this section, no person other
14than the corporation, or a shareholder in the right of the
15corporation pursuant to subsection 2, may bring an action
16or assert a claim with respect to the violation of any duty
17applicable to a benefit corporation or any of its directors
18under this subchapter.
   192.  Except for a proceeding brought under section 490.1705,
20subsection 3, a proceeding by a shareholder of a benefit
21corporation claiming violation of any duty applicable to
22a benefit corporation or any of its directors under this
23subchapter is subject to all of the following:
   24a.  The proceeding must be brought in a derivative proceeding
25pursuant to subchapter VII, part 4.
   26b.  The proceeding may be brought only by a shareholder
27of the benefit corporation that at the time of the act or
28omission complained of either individually, or together with
29other shareholders bringing such action collectively, owned
30directly or indirectly at least five percent of a class of
31the corporation’s outstanding shares or, in the case of a
32corporation with shares traded on an organized market as
33described in section 490.1302, subsection 2, paragraph “a”,
34subparagraph (2), either that percentage of shares or shares
35with a market value of at least five million dollars at the
-244-1time the proceeding is commenced.
   23.  A suit under subsection 2 shall not be maintained if,
3during the pendency of the suit, the shareholder individually
4fails, or the shareholders collectively fail, to continue to
5own directly or indirectly the lesser of the number of shares
6owned at the time the proceeding is commenced or five percent
7of a class of the corporation’s shares.
8   Sec. 212.  NEW SECTION.  490.1801  Application to existing
9domestic corporations.
   101.  This chapter applies to all domestic corporations in
11existence on July 1, 2021, that were incorporated under any
12general statute of this state providing for incorporation of
13corporations for profit if power to amend or repeal the statute
14under which the corporation was incorporated was reserved.
   152.  a.  Unless otherwise provided, this chapter does not
16apply to an entity subject to chapter 174, 497, 498, 499, 499A,
17501, 501A, 524, or 533, or a corporation organized on the
18mutual plan under chapter 491, or a telephone company organized
19as a corporation under chapter 491 qualifying pursuant to
20an internal revenue service letter ruling under Internal
21Revenue Code §501(c)(12) as a nonprofit corporation entitled
22to distribute profits in a manner similar to a chapter 499
23corporation, unless such entity voluntarily elects to adopt
24the provisions of this chapter and complies with the procedure
25prescribed by subsection 3.
   26b.  A corporation organized under chapter 496C may
27voluntarily elect to adopt the provisions of this chapter by
28complying with the provisions prescribed by subsection 3.
   293.  The procedure for the voluntary election referred to in
30subsection 2 is as follows:
   31a.  The corporation shall amend or restate its articles of
32incorporation to indicate that the corporation adopts this
33chapter and to designate the address of its initial registered
34office and the name of its registered agent at that office
35and, if the name of the corporation is not in compliance with
-245-1the requirements of this chapter, to change the name of the
2corporation to one complying with the requirements of this
3chapter.
   4b.  (1)  The instrument shall be delivered to the secretary
5of state for filing and recording in the secretary of state’s
6office. If the corporation was organized under chapter 524
7or 533, the instrument shall also be filed and recorded in
8the office of the county recorder. The corporation shall at
9the time it files the instrument with the secretary of state
10deliver also to the secretary of state for filing in the
11secretary of state’s office any biennial report required by
12section 490.1622 which is then due.
   13(2)  If the county of the initial registered office as stated
14in the instrument for a corporation organized under chapter
15524 or 533 is one which is other than the county where the
16principal place of business of the corporation, as designated
17in its articles of incorporation, was located, the corporation
18shall forward to the county recorder of the county in which the
19principal place of business of the corporation was located a
20copy of the instrument and the corporation shall forward to the
21recorder of the county in which the initial registered office
22of the corporation is located, in addition to a copy of the
23original instrument, a copy of the articles of incorporation of
24the corporation together with all amendments to them as then
25on file in the secretary of state’s office. The corporation
26shall, through an officer or director, certify to the secretary
27of state that a copy has been sent to each applicable county
28recorder, including the date each copy was sent.
   29c.  Upon the filing of the instrument by a corporation all
30of the following apply:
   31(1)  All of the provisions of this chapter apply to the
32corporation.
   33(2)  The secretary of state shall issue a certificate as to
34the filing of the instrument and deliver the certificate to the
35corporation or its representative.
-246-   1(3)  The secretary of state shall not file the instrument
2with respect to a corporation unless at the time of filing
3the corporation is validly existing and in good standing in
4that office under the chapter under which it is incorporated.
5The corporation shall be considered validly existing and in
6good standing for the purpose of this chapter for a period of
7three months following the expiration date of the corporation,
8provided all biennial reports due have been filed and all fees
9due in connection with the biennial reports have been paid.
   10d.  The provisions of this chapter becoming applicable to
11a corporation voluntarily electing to be governed by this
12chapter do not affect any right accrued or established, or any
13liability or penalty incurred, under the chapter under which
14it is incorporated prior to the filing by the secretary of
15state in the secretary of state’s office of the instrument
16manifesting the election by the corporation to adopt the
17provisions of this chapter as provided in this subsection.
   184.  A corporation subject to this chapter is not subject to
19chapter 491, 492, 493, or 495.
20   Sec. 213.  NEW SECTION.  490.1802  Application to existing
21foreign corporation.
   22A foreign corporation registered or authorized to do
23business in this state on the effective date of this division
24of this Act is subject to this chapter, is deemed to be
25registered to do business in this state, and is not required to
26file a foreign registration statement under this chapter.
27   Sec. 214.  NEW SECTION.  490.1803  Savings provisions.
   281.  Except as to procedural provisions, this division of this
29Act does not affect a pending action or proceeding or a right
30accrued before the effective date of this division of this Act,
31and a pending civil action or proceeding may be completed, and
32a right accrued may be enforced, as if this division of this
33Act had not become effective.
   342.  If a penalty or punishment for violation of a statute or
35rule is reduced by this division of this Act, the penalty, if
-247-1not already imposed, shall be imposed in accordance with this
2division of this Act.
   33.  In the event that any provision of this chapter is
4deemed to modify, limit, or supersede the federal Electronic
5Signatures in Global and National Commerce Act, 15 U.S.C. §7001
6et seq., the provisions of this chapter shall control to the
7maximum extent permitted by section 102(a)(2) of that federal
8Act.
9   Sec. 215.  NEW SECTION.  490.1804  Severability.
   10If any provision of this chapter or its application to any
11person or circumstance is held invalid by a court of competent
12jurisdiction, the invalidity does not affect other provisions
13or applications of this chapter that can be given effect
14without the invalid provision or application.
15   Sec. 216.  REPEAL.  2018 Iowa Acts, chapter 1015, section 8,
16is repealed.
17   Sec. 217.  CONTINUATION OF THE ARTICLES OF
18INCORPORATION.  Notwithstanding the amendments to sections
19490.803, 490.805, 490.806, and 490.810, as provided in this
20division of this Act, and the repeal of sections 490.806A,
21490.806B, and 490.1005A, as provided by those sections,
22any amendment to the articles of incorporation of a public
23corporation adopted in compliance with sections 490.806A,
24490.806B, and 490.1005A as those sections existed immediately
25prior to the effective date of this division of this Act shall
26remain in effect until amended or repealed as provided in the
27relevant sections of chapter 490 as those sections exist on or
28after the effective date of this division of this Act.
29   Sec. 218.  CODE EDITOR DIRECTIVE.
   301.  The Code editor is directed to make the following
31transfers:
   32a.  Section 490.135, as amended by this division of this Act,
33to section 490.130.
   34b.  Section 490.833, as amended by this division of this Act,
35to section 490.832.
-248-   1c.  Section 490.629 to section 490.628.
   2d.  Section 490.1622, as amended by this division of this
3Act, to section 490.1621.
   42.  The Code editor shall correct internal references in the
5Code and in any enacted legislation as necessary due to the
6enactment of this section.
7   Sec. 219.  REPEAL.  Sections 490.624A, 490.628, 490.1111,
8490.1112, 490.1113, 490.1114, 490.1520, 490.1523, 490.1530,
9490.1531, 490.1532, and 490.1606, Code 2020, are repealed.
10   Sec. 220.  DIRECTIONS TO THE CODE EDITOR.  The Code editor
11is directed to divide Code chapter 490 into subchapters and
12subdivide certain subchapters into parts, including sections in
13that chapter not amended in this division of this Act, sections
14amended or enacted in this division of this Act, and sections
15transferred in this division of this Act as follows:
   161.  Subchapter I, subdivided into part A, including sections
17490.101 and 490.102; part B, including sections 490.120 through
18490.129; part C, including section 490.130; part D, including
19sections 490.140 through 490.144; and part E, including
20sections 490.145 through 490.152.
   212.  Subchapter II, including sections 490.201 through
22490.209.
   233.  Subchapter III, including sections 490.301 through
24490.304.
   254.  Subchapter IV, including sections 490.401 through
26490.403.
   275.  Subchapter V, including sections 490.501 through
28490.504.
   296.  Subchapter VI, subdivided into part A, including
30sections 490.601 through 490.604; part B, including sections
31490.620 through 490.628; part C, including sections 490.630 and
32490.631; and part D, including section 490.640.
   337.  Subchapter VII, subdivided into part A, including
34sections 490.701 through 490.709; part B, including sections
35490.720 through 490.729; part C, including sections 490.730
-249-1through 490.732; part D, including sections 490.740 through
2490.747; and part E, including sections 490.748 and 490.749.
   38.  Subchapter VIII, subdivided into part A, including
4sections 490.800 through 490.811; part B, including sections
5490.820 through 490.826; part C, including sections 490.830
6through 490.832; part D, including sections 490.840 through
7490.844; part E, including sections 490.850 through 490.859;
8part F, including sections 490.860 through 490.863; and part
9G, including section 490.870.
   109.  Subchapter IX, subdivided into part A, including
11sections 490.901 through 490.905; part B, including sections
12490.920 through 490.924; and part C, including sections 490.930
13through 490.935.
   1410.  Subchapter X, subdivided into part A, including
15sections 490.1001 through 490.1009; and part B, including
16sections 490.1020 through 490.1022.
   1711.  Subchapter XI, including sections 490.1101 through
18490.1110.
   1912.  Subchapter XII, including sections 490.1201 and
20490.1202.
   2113.  Subchapter XIII, subdivided into part A, including
22sections 490.1301 through 490.1303; part B, including sections
23490.1320 through 490.1326; subchapter C, including sections
24490.1330 and 490.1331; and part D, including section 490.1340.
   2514.  Subchapter XIV, subdivided into part A, including
26sections 490.1401 through 490.1409; part B, including sections
27490.1420 through 490.1423; part C, including sections 490.1430
28through 490.1434; and part D, including section 490.1440.
   2915.  Subchapter XV, including sections 490.1501 through
30490.1512.
   3116.  Subchapter XVI, subdivided into part A, including
32sections 490.1601 through 490.1605; and part B, including
33sections 490.1620 and 490.1621.
   3417.  Subchapter XVII, including sections 490.1701 through
35490.1706.
-250-   118.  Subchapter XVIII, including sections 490.1801 through
2490.1804.
3   Sec. 221.  EFFECTIVE DATE.  This division of this Act takes
4effect July 1, 2021.
5DIVISION II
6CORRESPONDING AMENDMENTS
7   Sec. 222.  Section 249A.40, Code 2020, is amended to read as
8follows:
   9249A.40  Involuntarily dissolved providers — overpayments or
10incorrect payments.
   11Medical assistance paid to a provider following involuntary
12 administrative dissolution of the provider pursuant to chapter
13490, subchapter XIV, part B, shall be considered incorrectly
14paid for the purposes of section 249A.53 and the provider
15shall be considered to have received an overpayment for the
16purposes of this subchapter. For the purposes of this section,
17the overpayment shall not accrue until after a grace period
18of ninety days following receipt of notice by the provider
19of the dissolution from the department. Notwithstanding
20section 490.1422, or any other similar retroactive provision
21for reinstatement, the director shall recoup any medical
22assistance paid to a provider while the provider was dissolved
23if the provider is not retroactively reinstated within the
24ninety-day grace period. The principals of the provider shall
25be personally liable for the incorrect payment or overpayment.
26   Sec. 223.  Section 455B.397, Code 2020, is amended to read
27as follows:
   28455B.397  Financial disclosure.
   29Immediately upon the incurrence of any liability to
30the state under this part, the debtor shall submit to the
31director a report consisting of documentation of the debtor’s
32liabilities and assets, including if filed, a copy of the
33annual biennial report submitted to the secretary of state
34pursuant to chapter 490 section 490.1622. A subsequent report
35pursuant to this section shall be submitted annually on April
-251-115 for the life of the debt. These reports shall be kept
2confidential and shall not be available to the public.
3   Sec. 224.  Section 455B.430, subsection 5, Code 2020, is
4amended to read as follows:
   55.  Immediately upon the listing of real property in the
6registry of hazardous waste or hazardous substance disposal
7sites, a person liable for cleanup costs shall submit to
8the director a report consisting of documentation of the
9responsible person’s liabilities and assets, including if
10filed, a copy of the annual biennial report submitted to the
11secretary of state pursuant to chapter 490 section 490.1622. A
12subsequent report pursuant to this section shall be submitted
13annually on April 15 for the period the site remains on the
14registry.
15   Sec. 225.  Section 496C.14, subsection 5, Code 2020, is
16amended to read as follows:
   175.  Notwithstanding subsections 1 through 4, purchase by
18the corporation is not required upon the occurrence of any
19event other than death of a shareholder if the corporation
20is dissolved or voluntarily elects to adopt the provisions
21of the Iowa business corporation Act, as provided in section
22490.1701 490.1801, subsection 2, within sixty days after the
23occurrence of the event. The articles of incorporation or
24bylaws may provide that purchase is not required upon the death
25of a shareholder if the corporation is dissolved within sixty
26days after the death. Notwithstanding subsections 1 through 4,
27purchase by the corporation is not required upon the death of a
28shareholder if the corporation voluntarily elects to adopt the
29provisions of the Iowa business corporation Act, as provided
30in section 490.1701 490.1801, subsection 2, within sixty days
31after death.
32   Sec. 226.  Section 496C.19, Code 2020, is amended to read as
33follows:
   34496C.19  Dissolution or liquidation.
   35Violation of any provision of this chapter by a professional
-252-1corporation or any of its shareholders, directors, or officers
2shall be cause for its involuntary dissolution, or liquidation
3of its assets and business by the district court, as provided
4in the Iowa business corporation Act, chapter 490. Upon the
5death of the last remaining shareholder of a professional
6corporation, or whenever the last remaining shareholder is not
7licensed or ceases to be licensed to practice in this state a
8profession which the corporation is authorized to practice,
9or whenever any person other than the shareholder of record
10becomes entitled to have all shares of the last remaining
11shareholder of the corporation transferred into that person’s
12name or to exercise voting rights, except as a proxy, with
13respect to such shares, the corporation shall not practice
14any profession and it shall either be promptly dissolved or
15shall promptly elect to adopt the provisions of the Iowa
16business corporation Act, as provided in section 490.1701
17 490.1801, subsection 2. However, if prior to such dissolution
18all outstanding shares of the corporation are acquired by
19one or more persons licensed to practice in this state a
20profession which the corporation is authorized to practice,
21the corporation need not be dissolved and may practice the
22profession as provided in this chapter.
23   Sec. 227.  Section 499.69A, subsection 2, paragraph b,
24subparagraph (2), Code 2020, is amended to read as follows:
   25(2)  For a qualified corporation which is a party to the
26proposed qualified merger, the qualified corporation shall
27approve the plan as provided in chapter 490, subchapter XI.
28   Sec. 228.  Section 499.69A, subsections 5 and 6, Code 2020,
29are amended to read as follows:
   305.  The effect of a qualified merger for a qualified survivor
31which is a cooperative association shall be as provided for in
32this chapter. The effect of a qualified merger for a qualified
33survivor which is a qualified corporation shall be as provided
34for corporations under chapter 490, subchapter XI.
   356.  The provisions governing the right of a shareholder or
-253-1member of a cooperative association to object to a merger or
2the right of a member to dissent and obtain payment of the
3fair value of an interest in the cooperative association in
4the case of a merger as provided in this chapter shall apply
5to a qualified merger. The provisions governing the right
6of a shareholder of a corporation to dissent from exercise
7appraisal rights and obtain payment of the fair value of the
8shareholder’s shares in the case of a merger as provided in
9subchapter XIII of chapter 490, subchapter XIII, shall apply
10to a qualified merger.
11   Sec. 229.  Section 508.12, subsection 1, Code 2020, is
12amended to read as follows:
   131.  An insurer which is organized under the laws of any
14state and has created or will create jobs in this state or
15which is an affiliate or subsidiary of a domestic insurer,
16and is admitted to do business in this state for the purpose
17of writing insurance authorized by this chapter may become a
18domestic insurer by complying with section 490.902 490.905 or
19491.33 and with all of the requirements of law relative to the
20organization and licensing of a domestic insurer of the same
21type and by designating its principal place of business in this
22state may become a domestic corporation and be entitled to like
23certificates of its corporate existence and license to transact
24business in this state, and be subject in all respects to the
25authority and jurisdiction thereof.
26   Sec. 230.  Section 515.78, subsection 1, Code 2020, is
27amended to read as follows:
   281.  An insurer which is organized under the laws of any
29state and has created or will create jobs in this state or
30which is an affiliate or subsidiary of a domestic insurer,
31and is admitted to do business in this state for the purpose
32of writing insurance authorized by this chapter may become a
33domestic insurer by complying with section 490.902 490.905 or
34491.33 and with all of the requirements of law relative to the
35organization and licensing of a domestic insurer of the same
-254-1type and by designating its principal place of business in this
2state may become a domestic corporation and be entitled to like
3certificates of its corporate existence and license to transact
4business in this state, and be subject in all respects to the
5authority and jurisdiction thereof.
6   Sec. 231.  Section 515E.3A, subsection 1, paragraph a, Code
72020, is amended to read as follows:
   8a.  Complying with section 490.902 section 490.905.
9   Sec. 232.  Section 515G.3, subsection 2, Code 2020, is
10amended to read as follows:
   112.  A plan of conversion for an insurer organized on
12the mutual plan under chapter 491, shall also provide for
13conversion to a stock company as follows: the insurer
14organized on the mutual plan under chapter 491 shall amend
15its articles pursuant to chapter 491 as necessary to become
16a stock company, and shall immediately convert to a chapter
17490 corporation as provided in section 490.1701 490.1801 upon
18becoming a stock company.
19   Sec. 233.  EFFECTIVE DATE.  This division of this Act takes
20effect July 1, 2021.
21DIVISION III
22NONPROFIT CORPORATIONS
23   Sec. 234.  Section 504.205, Code 2020, is amended by adding
24the following new subsection:
25   NEW SUBSECTION.  4.  A state agency or state official shall
26not impose any requirement on a corporation that is more
27stringent, restrictive, or expansive than a requirement imposed
28by state or federal law.
29   Sec. 235.  EFFECTIVE DATE.  This division of this Act, being
30deemed of immediate importance, takes effect upon enactment.
da/jh/mb

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