Iowa 2023 2023-2024 Regular Session

Iowa House Bill HF655 Enrolled / Bill

Filed 05/11/2023

                    House File 655 - Enrolled   House File 655   AN ACT   PROVIDING FOR BUSINESS ORGANIZATIONS, INCLUDING LIMITED   LIABILITY COMPANIES, PROVIDING PENALTIES, AND INCLUDING   EFFECTIVE DATE PROVISIONS.   BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:    DIVISION I    LIMITED LIABILITY COMPANIES    Section 1. Section 489.101, Code 2023, is amended to read    as follows:    489.101 Short title.    1. This chapter may be cited as the Revised Uniform      Uniform Limited Liability Company Act .    2. In addition, article 14   subchapter XIV of this chapter    may be cited as provided in section 489.14101 .    Sec. 2. Section 489.102, Code 2023, is amended to read as      follows:      489.102 Definitions.      As used in this chapter , unless the context otherwise      requires   :         

  House File 655, p. 2   1. Certificate of organization means the certificate    required by section 489.201 . The term includes the certificate    as amended or restated.    2.   Contribution means any benefit provided by a person to    a limited liability company that is any of the following:    a.   In order to become a member upon formation of the company    and in accordance with an agreement between or among the      persons that have agreed to become the initial members of the    company.      b. In order to become a member after formation of the    company and in accordance with an agreement between the person      and the company.    c. In the persons capacity as a member and in accordance    with the operating agreement or an agreement between the member      and the company.    2.   Contribution , except in the phrase right of    contribution , means property or a benefit described in section    489.402 which is provided by a person to a limited liability    company to become a member or in the persons capacity as a      member.    3. Debtor in bankruptcy means a person that is the subject    of any of the following:    a. An order for relief under Tit. 11 of the United States    Code or a comparable order under a   successor statute of general    application.    b. A comparable order under federal, state, or foreign law    governing insolvency.    4. Deliver or delivery means any method of delivery    used in conventional commercial practice, including delivery in      person, by hand, mail, commercial delivery, and if authorized    in accordance with section 489.120, by   electronic transmission.    5. Distribution , except as otherwise provided in   section    489.405, subsection 6   , means a transfer of money or other    property from a limited liability company to another a person    on account of a transferable interest or in the persons      capacity as a member .    a.   Distribution includes all of the following:    (1) A redemption or other purchase by a limited liability    company of a transferable interest.                                                        

  House File 655, p. 3   (2)   A transfer to a member in return for the members    relinquishment of any right to participate as a member in    the management or conduct of the limited liability companys      activities and affairs or to have access to records or other      information concerning the companys activities and affairs.    b.   Distribution does not include amounts constituting    reasonable compensation for present or past service or payments      made in the ordinary course of business under a bona fide    retirement plan or other bona fide benefits program.      6. Domestic cooperative means an entity organized on a    cooperative basis under chapter 497 , 498 , or 499 , a cooperative    organized under chapter 499A , or a cooperative organized under    chapter 501 or 501A .    7.   Effective , with respect to a record required or    permitted to be delivered to the secretary of state for filing    under   this chapter , means effective under section 489.205,    subsection 3 .    7. Electronic means relating to technology having    electrical, digital, magnetic, wireless, optical,      electromagnetic, or similar capabilities.    8. Electronic transmission or electronically transmitted    means any form or   process of communication not directly    involving the physical transfer of paper that is suitable for    the retention, retrieval, and reproduction of information by      the recipient. or another tangible medium that is all of the    following:    a. Suitable for the retention, retrieval, and reproduction    of information by the recipient.    b.   Retrievable in paper form by the recipient through an    automated process used in conventional commercial practice.    9.   Filing entity means an unincorporated entity, other    than a limited liability partnership, that is of a type that    is created by filing a public organic record or is required to      file a public organic record that evidences its creation.    9.   10. Foreign limited liability company means an    unincorporated entity formed under the law of a jurisdiction    other than this state and denominated by that law as a limited      liability company which would be a limited liability company if    formed under the law of this state .                                                               

  House File 655, p. 4   11.   Jurisdiction , used to refer to a political entity,    means the United States, a state, a foreign country, or a    political subdivision of a foreign country.      12.   Jurisdiction of formation means the jurisdiction whose    law governs the internal affairs of an entity.    10.   13. Limited liability company , except in the phrase    foreign limited liability company , and in subchapter X   means    an entity formed under this chapter or which becomes subject to    this chapter under subchapter X or section 489.110   .    11. 14. Manager means a person that under the operating    agreement of a manager-managed limited liability company is    responsible, alone or in concert with others, for performing    the management functions stated in section 489.407, subsection    3 .    12.   15. Manager-managed limited liability company means a    limited liability company that qualifies under section 489.407,    subsection 1 .    13.   16. Member means a person that has become a member    of a limited liability company under   section 489.401 and has    not dissociated under section 489.602 . for whom all of the    following are true:    a.   The person has become a member of a limited liability    company under section 489.401 or was a member in a limited    liability company when the company became subject to this      chapter under section 489.110.    b. The person is not dissociated under section 489.602.    14. 17. Member-managed limited liability company means a    limited liability company that is not a manager-managed limited    liability company.    18.   Nonfiling entity means an unincorporated entity that    is of a type that is not created by filing a public organic      record.      15.   19. Operating agreement means the agreement, whether    or not referred to as an operating agreement and whether oral,    implied,   in a record, implied, or in any combination thereof,    of all the members of a limited liability company, including    a sole member, concerning the matters described in section    489.110, subsection 1 . The term includes the agreement as    amended or restated.                                                       

  House File 655, p. 5   16.   20. Organizer means a person that acts under section    489.201 to form a limited liability company.    17.   21. a. Person means an individual, business    corporation, business trust, estate, trust,   nonprofit    corporation, partnership, limited partnership, limited    liability company, domestic cooperative, unincorporated      nonprofit   association, statutory trust, business trust,    common-law business trust, estate, trust, association, joint    venture, public corporation, government or governmental    subdivision, agency, or instrumentality, or any other legal or    commercial entity.    b.   Person includes a protected series, however    denominated, of an entity if the protected series is    established under law that limits, or limits if conditions      specified under law are satisfied, the ability of a creditor    of the entity or of any other protected series of the entity to      satisfy a claim from assets of the protected series.    18. 22. Principal office means the principal executive    office of a limited liability company or foreign limited    liability company, whether or not the office is located in this    state.    23.   Property means all property, whether real, personal,    or mixed or tangible or intangible, or any right or interest    therein.      19. 24. Record , used as a noun, means information that    is inscribed on a tangible medium or that is stored in an    electronic or other medium and is retrievable in perceivable    form.    20.   Registered office means the office that a limited    liability company or foreign limited liability company is    required to designate and maintain under   section 489.113 .    25.   Registered agent means an agent of a limited    liability company or foreign limited liability company which is      authorized to receive service of any process, notice, or demand    required or permitted by law to be served on the company.      26. Registered foreign limited liability company means    a foreign limited liability company that is registered to do      business in this state pursuant to a statement of registration    filed by the secretary of state.                                                            

  House File 655, p. 6   21.   27. Sign means, with the present intent to    authenticate or adopt a record, to do any of the following:    a. Execute or adopt a tangible symbol.    b. Attach to or logically associate with the record an    electronic symbol, sound, or process.    22.   28. State means a state of the United States, the    District of Columbia, Puerto Rico, the United States Virgin    Islands, or any territory or insular possession subject to the    jurisdiction of the United States.    23.   29. Transfer includes an assignment, conveyance,    deed, bill of sale, lease, mortgage, security interest,      encumbrance, gift, or transfer by operation of law. any of the    following:    a.   An assignment.    b. A conveyance.    c.   A sale.    d. A lease.    e. An encumbrance, including a mortgage or security    interest.      f. A gift.    g. A transfer by operation of law.    24.   30. a. Transferable interest means the right, as    originally associated with initially owned by a person in the    persons capacity as a member, to receive distributions from    a limited liability company ,   in accordance with the operating    agreement, whether or not the person remains a member or    continues to own any part of the right.    b. Transferable interest applies to any fraction of the    interest, by whomever owned.      25. 31. a. Transferee means a person to which all or    part of a transferable interest has been transferred, whether    or not the transferor is a member.      b.   Transferee includes a person that owns a transferable    interest under section 489.603, subsection 1, paragraph   c .    Sec. 3. Section 489.103, Code 2023, is amended to read as      follows:      489.103 Knowledge  notice.    1. A person knows a fact when   if the person has or is any    of the following:                                                                 

  House File 655, p. 7   a. Has actual knowledge of it.    b. Is deemed to know it under subsection 4 , paragraph a ,    or law other than this chapter .    2. A person has notice of a fact when   if the person has or    is any of the following:    a. Has reason to know the fact from all of   the facts known    to the person at the time in question.    b. Is deemed to have notice of the fact under subsection 4 ,    paragraph b .    3. A   Subject to section 489.210, subsection 6, a person    notifies another person   of a fact by taking steps reasonably    required to inform the other person in ordinary course, whether    or not those steps cause the other person knows to know the    fact.    4. A person that is   not a member is deemed both all of the    following:    a. To know of a limitation on authority to transfer real    property as provided in section 489.302, subsection 7 .    b. To have notice of all of the following regarding a      limited liability companys :    (1) Dissolution, The limited liability companys    dissolution,   ninety days after a statement of dissolution under    section 489.702, subsection 2 , paragraph b , subparagraph (1),    becomes effective.    (2) Termination,   The limited liability companys    termination, ninety days after a statement of termination under    section 489.702, subsection 2 , paragraph b , subparagraph (6),    becomes effective.    (3) Merger,   The limited liability companys participation    in a merger, interest exchange, conversion, or domestication,    ninety days after articles of merger, interest exchange,      conversion, or domestication under article 10 subchapter X    become effective.    Sec. 4. Section 489.104, Code 2023, is amended to read as      follows:      489.104 Nature, purpose, and duration of limited liability    company.    1. A limited liability company is an entity distinct from    its member or   members.                              

  House File 655, p. 8   2. A limited liability company may have any lawful purpose,    regardless of whether for profit.    3. A limited liability company has perpetual duration.    Sec. 5. Section 489.105, Code 2023, is amended to read as    follows:    489.105 Powers.    1. Except as otherwise provided in subsection 2 , a limited    liability company has the capacity to sue and be sued in its    own name and the power to do all things necessary or convenient    to carry on its activities and affairs   .    2. Until a limited liability company has or has had at    least one member, the limited liability   company lacks the    capacity to do any act or carry on any activity except all of    the following:    a. Delivering to the secretary of state for filing a    statement of change under section 489.114 , an amendment to the    certificate under section 489.202 , a statement of correction    under section 489.206 , a biennial report under section 489.209 ,    a statement of withdrawal or a statement of rescission under    section 489.701A , or a statement of termination under section    489.702, subsection 2 , paragraph b , subparagraph (6).    b. Admitting a member under section 489.401 .    c. Dissolving under section 489.701 .    3. A limited liability company that has or has had at least    one member may ratify an act or activity that occurred when the    company lacked capacity under subsection 2 .    Sec. 6. Section 489.106, Code 2023, is amended to read as    follows:    489.106 Governing law.    The law of this state governs all of the following:    1. The internal affairs of a limited liability company.    2. The liability of a member as member and a manager as    manager for the debts, obligations,   a debt, obligation, or    other liabilities liability of a limited liability company.    Sec. 7. Section 489.108, Code 2023, is amended to read as    follows:      489.108 Name   Permitted names .      1. The name of a limited liability company must contain    the words   phrase limited liability company or limited             

  House File 655, p. 9   company or the abbreviation L. L. C., LLC, L. C., or LC.    Limited may be abbreviated as Ltd., and company may be    abbreviated as Co..    2. Unless authorized by   Except as otherwise provided in    subsection 3 , the name of a limited liability company , and    the name under which a foreign limited liability company may      register to do business in this state,   must be distinguishable    in on the records of the secretary of state from all any of the    following:    a.   The name of each person that is not an individual and    that is incorporated, organized, or authorized to transact      business in this state.    b. Each name reserved under section 489.109 .    a.   The name of an existing person whose formation required    the filing of a record by the secretary of state and which is    not at the time administratively dissolved, or if such person      has been administratively dissolved, within five years of the    effective date of dissolution.    b.   The name of a limited liability partnership whose    statement of qualification is in effect.    c. The name under which a person is registered to do    business in this state by the filing of a record by the      secretary of state.    d.   The name reserved under section 489.109 or other law    of this state providing for the reservation of a name by the    filing of a record by the secretary of state.    e. The name registered under section 489.114 or other law    of this state providing for the registration of a name by the    filing of a record by the secretary of state.      f. The name registered with the secretary of state as a    fictitious name.      3. A limited liability company may apply to the secretary of    state for authorization to use a name that does not comply with      subsection 2 . The secretary of state shall authorize use of    the name applied for if either of the following applies:   If a    person consents in a record to the use of its name and submits    an undertaking in a form satisfactory to the secretary of state      to change its name to a name that is distinguishable on the    records of the secretary of state from any name in any category                                                              

  House File 655, p. 10   of names in subsection 2, the name of the consenting person may      be used by the person to which the consent was given.    a.   The present user, registrant, or owner of the    noncomplying name consents in a signed record to the use      and submits an undertaking in a form satisfactory to the    secretary of state to change the noncomplying name to a name      that complies with   subsection 2 and is distinguishable in the    records of the secretary of state from the name applied for.    b.   The applicant delivers to the secretary of state a    certified copy of the final judgment of a court establishing    the applicants right to use in this state the name applied      for.    4. A limited liability company may use the name, including    the fictitious name, of another entity that is used in this      state if the other entity is formed under the law of this    state or is authorized to transact business in this state      and the proposed user limited liability company meets any    of the following conditions: In determining whether a name    is the same as or not distinguishable on the records of the      secretary of state from the name of another person, words,    phrases, or abbreviations indicating a type of person, such as    corporation, corp., incorporated, Inc., professional      corporation, P.C., PC, professional association, P.A.,    PA, Limited, Ltd., limited partnership, L.P., LP,      limited liability partnership, L.L.P., LLP, registered    limited liability partnership, R.L.L.P., RLLP, limited    liability limited partnership, L.L.L.P., LLLP, registered    limited liability limited partnership, R.L.L.L.P., RLLLP,    limited liability company, L.L.C., LLC, cooperative,      coop, or CP shall not be taken into account.    a.   Has merged with the other entity.    b. Has been formed by reorganization of the other entity.    c.   Has acquired all or substantially all of the assets,    including the name, of the other entity.    5. This article   does not control the use of fictitious    names. However, if a limited liability company uses a    fictitious name in this state, it shall deliver to the      secretary of state for filing a certified copy of the    resolution of its members if it is member-managed or its                                                        

  House File 655, p. 11   managers if it is manager-managed, adopting the fictitious      name. The name of a limited liability company or foreign    limited liability company shall not contain words that may be      used only with approval by another state department or state      agency unless the company obtains the approval of such other    state department or agency and delivers to the secretary of      state for filing a record certifying such approval.      6. Subject to section 489.805 , this section applies to    a foreign limited liability company transacting business in      this state which has a certificate of authority to transact    business in this state or which has applied for a certificate      of authority. A limited liability company or foreign limited    liability company may use a name that is not distinguishable    from a name described in subsection 2, paragraphs   a through    f , if the company delivers to the secretary of state a    certified copy of a final judgment of a court of competent      jurisdiction establishing the right of the company to use the    name in this state.    7.   A limited liability company may use the name, including    the fictitious name, of another entity that is used in this    state if the other entity is formed under the law of this    state or is authorized to transact business in this state and      the proposed user limited liability company meets any of the    following conditions:      a. Has merged with the other entity.    b. Has been formed by reorganization of the other entity.    c. Has acquired all or substantially all of the assets,    including the name, of the other entity.    8.   This subchapter does not control the use of fictitious    names. However, if a limited liability company uses a    fictitious name in this state, it shall deliver to the      secretary of state for filing a certified copy of the    resolution of its members if it is member-managed or its      managers if it is manager-managed, adopting the fictitious    name.      Sec. 8. Section 489.109, Code 2023, is amended to read as      follows:      489.109 Reservation of name.      1. A person may reserve the exclusive use of the   a name                                                           

  House File 655, p. 12   of a limited liability company, including a fictitious or      assumed name for a foreign limited liability company whose    name is not available, by delivering an application to the      secretary of state for filing   that complies with section    489.112 by delivering an application to the secretary of state    for filing   . The application must state the name and address    of the applicant and the name proposed   to be reserved. If    the secretary of state finds that the name applied for is    available, it must be reserved   the secretary of state shall    reserve the name for the applicants exclusive use for a    one-hundred-twenty-day period   one hundred and twenty days .    2. The owner of a reserved name reserved for a limited    liability company may transfer the reservation to another    person by delivering to the secretary of state for filing   a    signed notice in a record of the transfer which states the name    and address of the transferee   person to which the reservation    is being transferred .    Sec. 9. Section 489.110, Code 2023, is amended to read as    follows:    489.110 Operating agreement  scope, function, and    limitations.    1. Except as otherwise provided in subsections 2   3 and 3 4 ,    the operating agreement governs all of the following:    a. Relations among the members as members and between the    members and the limited liability company.    b. The rights and duties under this chapter of a person in    the capacity of manager.    c. The activities and affairs   of the company and the conduct    of those activities and affairs   .    d. The means and conditions for amending the operating    agreement.    2. To the extent the operating agreement does not otherwise      provide for a matter described in subsection 1 , this chapter    governs the matter.    3. An operating agreement shall not do any of the following:    a. Vary a limited liability companys capacity under   section    489.105   to sue and be sued in its own name the law applicable    under section 489.104 .    b. Vary the law applicable under section 489.106 a limited                                          

  House File 655, p. 13   liability companys capacity under section 489.109 to sue and      be sued in its own name .    c. Vary the power of the court under   section 489.204 . any    requirement, procedure, or other provision of this chapter      pertaining to any of the following:    (1)   Registered agents.    (2)   The secretary of state, including provisions pertaining    to records authorized or required to be delivered to the    secretary of state for filing under this chapter.      d. Subject to subsections 4 through 7 , eliminate the duty of    loyalty, the duty of care, or any other fiduciary duty   Vary the    provisions of section 489.204 .    e. Subject to subsections 4 through 7 , eliminate the    contractual obligation of good faith and fair dealing under      section 489.409, subsection 4 Alter or eliminate the duty of    loyalty or the duty of care, except as otherwise provided in      subsection 4 .    f. Unreasonably restrict the duties and rights stated in    section 489.410   Eliminate the contractual obligation of good    faith and fair dealing under section 489.409, subsection 4,    but the operating agreement may prescribe the standards, if    not manifestly unreasonable, by which the performance of the      obligation is to be measured .    g. Vary the power of a court to decree dissolution in      the circumstances specified in section 489.701, subsection    1 , paragraphs d and e Relieve or exonerate a person from    liability for conduct except as provided in subsection 6 .    h. Vary the requirement to wind up a limited liability    companys business as specified in   section 489.702,    subsection 1 , and section 489.702, subsection 2 , paragraph    a   Unreasonably restrict the duties and rights under section    489.410, but the operating agreement may impose reasonable    restrictions on the availability and use of information      obtained under that section and may define appropriate    remedies, including liquidated damages, for a breach of any      reasonable restriction on use .      i. Unreasonably restrict the right of a member to maintain      an action under article 9 Vary the causes of dissolution    specified in section 489.701, subsection 1, paragraph   d .                                                                      

  House File 655, p. 14   j. Restrict the right to approve a merger, conversion, or      domestication under section 489.1014 to a member that will have    personal liability with respect to a surviving, converted, or      domesticated organization   Vary the requirement to wind up the    limited liability companys activities and affairs as specified    in section 489.702, subsection 1; subsection 2, paragraph   a ;    and subsection 5   .    k. Except as otherwise provided in section 489.112,    subsection 2   , restrict the rights under this chapter of a    person other than a member or manager Unreasonably restrict the    right of a member to maintain an action under subchapter VIII   .    l. Vary the provisions of section 489.805A, but the    operating agreement may provide that the limited liability    company shall not have a special litigation committee.      m. Vary the right of a member to approve a merger, interest    exchange, conversion, or domestication under section 489.1023,      subsection 1, paragraph b ; section 489.1033, subsection 1,    paragraph b ; section 489.1043, subsection 1, paragraph b ; or    section 489.1053, subsection 1, paragraph   b .    n. Vary the required contents of a plan of merger under    section 489.1022, subsection 1; plan of interest exchange    under section 489.1032, subsection 1; plan of conversion under      section 489.1042, subsection 1; or plan of domestication under    section 489.1052, subsection 1.      o. Except as otherwise provided in sections 489.111 and    489.112, subsection 2, restrict the rights under this chapter    of a person other than a member or manager.    4. If not manifestly unreasonable, the operating agreement    may do any of the following:   Subject to subsection 3,    paragraph g , without limiting other terms that may be included    in an operating agreement, all the following rules apply:      a. Restrict or eliminate the duty to do any The operating    agreement may do all   of the following:    (1) As required in section 489.409, subsection 2 , paragraph    a   , and section 489.409, subsection 8 , to account to the    limited liability company and to hold as trustee for it any    property, profit, or benefit derived by the member in the      conduct or winding up of the companys business, from a use by      the member of the companys property, or from the appropriation                                                                               

  House File 655, p. 15   of a limited liability company opportunity   Specify the method    by which a specific act or transaction that would otherwise    violate the duty of loyalty may be authorized or ratified by      one or more disinterested and independent persons after full      disclosure of all material facts .    (2) As required in   section 489.409, subsection 2 , paragraph    b   , and section 489.409, subsection 8 , to refrain from dealing    with the company in the conduct or winding up of the companys    business as or on behalf of a party having an interest adverse      to the company Alter the prohibition in section 489.405,    subsection 1, paragraph   b , so that the prohibition requires    only that the limited liability companys total assets not be    less than the sum of its total liabilities .    (3)   As required by section 489.409, subsection 2 , paragraph    c , and section 489.409, subsection 8 , to refrain from    competing with the company in the conduct of the companys      business before the dissolution of the company.    b. Identify specific types or categories of activities    that do not violate the duty of loyalty   To the extent the    operating agreement of a member-managed limited liability    company expressly relieves a member of a responsibility that    the member otherwise would have under this chapter and imposes      the responsibility on one or more other members, the agreement    also may eliminate or limit any fiduciary duty of the member      relieved of the responsibility which would have pertained to    the responsibility .    c. Alter the duty of care, except to authorize intentional    misconduct or knowing violation of law. If not manifestly    unreasonable, the operating agreement may do all of the      following:    (1)   Alter or eliminate the aspects of the duty of loyalty    stated in section 489.409, subsections 2 and 9.    (2)   Identify specific types or categories of activities    that do not violate the duty of loyalty.    (3)   Alter the duty of care, but may not authorize conduct    involving bad faith, willful or intentional misconduct, or    knowing violation of law.      (4) Alter or eliminate any other fiduciary duty.    d. Alter any other fiduciary duty, including eliminating                                                                      

  House File 655, p. 16   particular aspects of that duty.      e. Prescribe the standards by which to measure the    performance of the contractual obligation of good faith and      fair dealing under   section 489.409, subsection 4 .    5. The operating agreement may specify the method by which    a specific act or transaction that would otherwise violate the      duty of loyalty may be authorized or ratified by one or more      disinterested and independent persons after full disclosure    of all material facts   The court shall decide as a matter of    law whether a term of an operating agreement is manifestly    unreasonable under subsection 3, paragraph   f , or subsection    4, paragraph c . All of the following shall apply:    a. The court shall make its determination as of the time the    challenged term became part of the operating agreement and by      considering only circumstances existing at that time.    b.   The court may invalidate the term only if, in light of    the purposes, activities, and affairs of the limited liability    company, it is readily apparent that any of the following    apply:      (1) The objective of the term is unreasonable.    (2) The term is an unreasonable means to achieve the terms    objective.      6. To the extent the operating agreement of a member-managed    limited liability company expressly relieves a member of a      responsibility that the member would otherwise have under    this chapter and imposes the responsibility on one or more    other members, the operating agreement may, to the benefit    of the member that the operating agreement relieves of the    responsibility, also eliminate or limit any fiduciary duty that      would have pertained to the responsibility.    7.   6. The An operating agreement may alter or eliminate    the indemnification for a member or manager provided by section    489.408, subsection 1 , and may eliminate or limit a members    or managers liability to the limited liability company and    members for money damages, except for any of the following:    a. A breach of the duty of loyalty.    b. A financial benefit received by the member or manager to    which the member or manager is not entitled.    c. A breach of a duty under section 489.406 .                                                         

  House File 655, p. 17   d. Intentional infliction of harm on the company or a    member.    e. An intentional violation of criminal law.    8.   The court shall decide any claim under subsection 4 that    a term of an operating agreement is manifestly unreasonable.    All of the following apply:      a.   The court shall make its determination as of the time the    challenged term became part of the operating agreement and by    considering only circumstances existing at that time.      b. The court may invalidate the term only if, in light of    the purposes and activities of the limited liability company,      it is readily apparent that any of the following applies:    (1) The objective of the term is unreasonable.    (2)   The term is an unreasonable means to achieve the    provisions objective.    Sec. 10. Section 489.111, Code 2023, is amended to read as    follows:    489.111 Operating agreement  effect on limited liability    company and persons becoming members  preformation agreement.    1. A limited liability company is bound by and may enforce    the operating agreement, whether or not the company has itself    manifested assent to the operating agreement.    2. A person that becomes a member of a limited liability    company is deemed to assent to the operating agreement.    3. Two or more persons intending to become the initial    members of a limited liability company may make an agreement    providing that upon the formation of the company the agreement    will become the operating agreement. One person intending    to become the initial member of a limited liability   company    may assent to terms providing that upon the formation of the    company the terms will become the operating agreement.    4. An operating agreement in a signed record that excludes    modification or rescission except by a signed record cannot be    otherwise modified or rescinded.      Sec. 11. Section 489.112, Code 2023, is amended to read as      follows:      489.112 Operating agreement  effect on third parties and    relationship to records effective on behalf of limited liability    company.                            

  House File 655, p. 18   1. An operating agreement may specify that its amendment    requires the approval of a person that is not a party to the    operating agreement or the satisfaction of a condition. An    amendment is ineffective if its adoption does not include the    required approval or satisfy the specified condition.    2. The obligations of a limited liability company and its    members to a person in the persons capacity as a transferee or    a person   dissociated as a member are governed by the operating    agreement. Subject only to any   a court order issued under    section 489.503, subsection 2 , paragraph b , to effectuate a    charging order, an amendment to the operating agreement made    after a person becomes a transferee or is   dissociated as a    member is or is not effective as follows:    a.   Is effective with regard to any debt, obligation, or    other liability of the limited liability company or its members    to the person in the persons capacity as a transferee or person       dissociated as a member.   b. Is not effective to the extent the amendment imposes a    new debt, obligation, or other liability on the transferee or      person dissociated as a member.    3. If a record that has been delivered by a limited    liability company to the secretary of state for filing and      has become becomes effective under this chapter and contains    a provision that would be ineffective under section 489.110,    subsection 3 or subsection 4, paragraph   c , if contained in    the operating agreement, the provision is likewise ineffective    in the record.    4. Subject to subsection 3 , if a record that has been    delivered by a limited liability company to the secretary    of state for filing and has become   becomes effective under    this chapter   and conflicts with a provision of the operating    agreement, all of the following rules apply:    a. The operating agreement prevails as to members, persons      dissociated as members, transferees, and managers.    b. The record prevails as to other persons to the extent    they reasonably rely on the record.    Sec. 12. Section 489.114, Code 2023, is amended to read as      follows:      489.114 Change of registered office or registered   agent for                                          

  House File 655, p. 19   service of process   or address for registered agency by limited    liability company .    1. A limited liability company or registered   foreign    limited liability company may change its registered office      or its registered agent for service of process agent or the    address of its registered agent   by delivering to the secretary    of state for filing a statement of change that sets forth      states all of the following:    a. The name of the limited liability   company or foreign    limited liability company .    b. If the current registered office is to be changed, the      street and mailing addresses of the new registered office The    information that is to be in effect as a result of the filing of    the statement of change   .    c. If the current registered agent is to be changed, the    name of the new registered agent and the new agents consent to      the appointment. The agents consent may be on the statement    or attached to it.    d.   That after the change or changes are made, the street    address of its registered office and the business office of its    registered agent will be identical.    2. If a registered agent changes the street address of      the registered agents business office, the registered agent    may change the street address of the registered office of any      limited liability company or foreign limited liability company    for which the person is the registered agent by notifying the    limited liability company or foreign limited liability company    in writing of the change and signing, either manually or in    facsimile, and delivering to the secretary of state for filing      a statement that complies with the requirements of subsection    1   and recites that the limited liability company or foreign    limited liability company has been notified of the change. The    members or managers of a limited liability company need not      approve the delivery to the secretary of state for filing of    any of the following:      a. A statement of change under this section.    b.   A similar filing changing the registered agent or    registered office, if any, of the limited liability company in    any other jurisdiction.                                                         

  House File 655, p. 20   3. If a registered agent changes the registered agents      business address to another place, the registered agent may    change the business address and the address of the registered      agent by filing a statement as required by   subsection 2 for    each limited liability company or foreign limited liability    company, or a single statement of all limited liability      companies or all foreign limited liability companies named      in the notice, except that it need be signed only by the    registered agent and need not be responsive to   subsection 1 ,    paragraph c , and must recite that a copy of the statement    has been mailed to each limited liability company or foreign      limited liability company named in the notice A statement of    change under this section designating a new registered agent    is an affirmation of fact by the limited liability company or      registered foreign limited liability company that the agent has    consented to serve   .    4. A limited liability company or foreign limited liability    company may also change its registered office or registered    agent in its biennial report as provided in   section 489.209    As an alternative to using the procedure in this section,    a limited liability company may amend its certificate of    organization   .    5. Subject to section 489.205, subsection 3 , a statement of    change is effective when filed by the secretary of state.    Sec. 13. NEW SECTION   . 489.114A Registration of name.    1. A foreign limited liability company not registered to    do business in this state under subchapter IX may register    its name, or an alternate name adopted pursuant to section    489.906A, if the name is distinguishable on the records of the    secretary of state from the names that are not available under    section 489.108.    2. To register its name or an alternate name adopted    pursuant to section 489.906A, a foreign limited liability    company must deliver to the secretary of state for filing an    application stating the companys name, the jurisdiction and    date of its formation, and any alternate name adopted pursuant    to section 489.906A. If the secretary of state finds that the    name applied for is available, the secretary of state shall    register the name for the applicants exclusive use.                                  

  House File 655, p. 21   3. The registration of a name under this section is    effective for one year after the date of registration.    4. A foreign limited liability company whose name    registration is effective may renew the registration for    successive one-year periods by delivering, not earlier than    three months before the expiration of the registration,    to the secretary of state for filing a renewal application    that complies with this section. When filed, the renewal    application renews the registration for a succeeding one-year    period.    5. A foreign limited liability company whose name    registration is effective may register as a foreign limited    liability company under the registered name or consent in a    signed record to the use of that name by another person that is    not an individual.    Sec. 14. Section 489.115, Code 2023, is amended to read as    follows:    489.115 Resignation of registered agent for service of    process   .    1. A registered agent may resign the agents agency    appointment by signing and as an agent for a limited liability    company or registered foreign limited liability company by      delivering to the secretary of state for filing the signed    original   a statement of resignation . The statement of    resignation may include a statement that the registered office    is also discontinued. The registered agent shall send a copy    of the statement of resignation by certified mail, return    receipt requested, to the limited liability company or foreign    limited liability company at its principal office and to the      registered office, if not discontinued. The registered agent    shall certify to the secretary of state that the copies have      been sent to the limited liability company or foreign limited    liability company, including the date the copies were sent.      that states all of the following:    a.   The name of the limited liability company or foreign    limited liability company.    b.   The name of the agent.    c. That the agent resigns from serving as registered agent    for the limited liability company or foreign limited liability                                  

  House File 655, p. 22   company.      d. The address of the limited liability company or foreign    limited liability company to which the agent will send the      notice required by subsection 3.      2. A statement of resignation takes effect on the earlier    of the following:    a. 12:01 a.m. on the   The thirty-first day after the day on    which it is filed with the secretary of state.    b. The designation of a new registered agent for the limited    liability company or registered foreign limited liability      company   .    3. A registered agent promptly shall furnish to the limited    liability company or registered foreign limited liability    company notice in a record of the date on which a statement of      resignation was filed.    4.   When a statement of resignation takes effect, the    registered agent ceases to have responsibility under this    chapter for any matter thereafter tendered to it as agent for    the limited liability company or registered foreign limited      liability company. The resignation does not affect any    contractual rights the company or foreign company has against    the agent or that the agent has against the company or foreign      company.    5.   A registered agent may resign with respect to a limited    liability company or registered foreign limited liability    company whether or not the company or foreign company is in    good standing.    Sec. 15. NEW SECTION . 489.115A Registered agent.    1. Each limited liability company and each registered    foreign limited liability company shall designate and maintain    a registered agent in this state. The designation of a    registered agent is an affirmation of fact by the limited    liability company or registered foreign limited liability    company that the agent has consented to serve.    2. A registered agent for a limited liability company or    registered foreign limited liability company must have a place    of business in this state.      3. The only duties under this chapter of a registered agent    that has complied with this chapter are as follows:                                    

  House File 655, p. 23   a. To forward to the limited liability company or registered    foreign limited liability company at the address most recently    supplied to the agent by the limited liability company or    registered foreign limited liability company any process,    notice, or demand pertaining to the company or foreign company    which is served on or received by the agent.    b. If the registered agent resigns, to provide the notice    required by section 489.115, subsection 3, to the limited    liability company or registered foreign limited liability    company at the address most recently supplied to the agent by    the limited liability company or registered foreign limited    liability company.    c. To keep current the information with respect to the agent    in the certificate of organization or foreign registration    statement.    Sec. 16. Section 489.116, Code 2023, is amended to read as    follows:    489.116 Service of process , notice, or demand .    1. A limited liability companys   company or registered    foreign limited liability companys registered agent is the    companys agent for service of process, notice, or demand    required or permitted by law to   company may be served on    the company with any process, notice, or demand required or    permitted by law by serving its registered agent   .    2. If a limited liability company or registered foreign    limited liability company has no ceases to have a registered    agent, or the if its registered agent cannot with reasonable    diligence be served, the limited liability company or    registered foreign limited liability company   may be served by    registered or certified mail, return receipt requested, or by    similar commercial delivery service,   addressed to the limited    liability company or registered foreign limited liability    company   at its principal office. The address of the principal    office must be as shown on the limited liability companys or      registered foreign limited liability companys most recent      biennial report filed with the secretary of state pursuant to    section 489.209.   Service is perfected effected under this    subsection at on the earliest of any of the following:    a. The date the limited liability company or registered                                       

  House File 655, p. 24   foreign limited liability company receives the mail or delivery      by the commercial delivery service .    b. The date shown on the return receipt, if signed on behalf      of   by the limited liability company or registered foreign    limited liability company .    c. Five days after its deposit in   with the United States    mail, as evidenced by the postmark, if mailed postpaid and      postal service or with the commercial delivery service, if    correctly addressed and with sufficient postage or payment   .    3. A limited liability company or foreign limited liability    company may be served pursuant to   this section , as provided    in another provision of this chapter , or as provided in    sections 617.3 through 617.6 , unless the manner of service is    otherwise specifically provided for by another provision of law      If process, notice, or demand cannot be served on a limited    liability company or registered foreign limited liability      company pursuant to subsection 1 or 2, service may be made by    handing a copy to the individual in charge of any regular place    of business or activity of the limited liability company or      registered foreign company if the individual served is not a    plaintiff in the action .    4.   Service of process, notice, or demand on a registered    agent must be in a written record.    5.   Service of process, notice, or demand may be made by    other means under law other than this chapter, including as    provided in sections 617.3 through 617.6 unless specifically    provided for by another provision of law.    Sec. 17. Section 489.117, Code 2023, is amended to read as    follows:    489.117 Fees.    1. The secretary of state shall collect the following fees    when documents described in this subsection are delivered to      the secretarys office for filing:    a. Statement of rescission . . . . . . . . . . . . . . . . . . . . . No fee      b. Statement of withdrawal . . . . . . . . . . . . . . . . . . . . . No fee      c. Certificate of organization . . . . . . . . . . . . . . . . . . . $ 50    d. Application for use of    indistinguishable name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10    e. Application for reserved name . . . . . . . . . . . . . . . . . $ 10                                           

  House File 655, p. 25   f. Notice of transfer of reserved name . . . . . . . . . . . $ 10    g. Statement of change of registered    agent or registered office or both . . . . . . . . . . . . . . . . . No fee    h. Registered agents statement of    change of registered office   for each    affected limited liability company . . . . . . . . . . . . . . . . . No fee    i. Registered agents statement    of resignation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . No fee    j. Amendment to certificate of    organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50    k. Restatement of certificate of    organization with amendment    of certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50    l. Articles of merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50    m. Statement of dissolution . . . . . . . . . . . . . . . . . . . . . . $ 5    n. Declaration of administrative    dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . No fee    o. Application for reinstatement    following administrative dissolution . . . . . . . . . . . . . . . . . $ 5    p. Certificate of reinstatement . . . . . . . . . . . . . . . . No fee    q. Application for certificate    of authority   registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . $100    r. Application for amended    certificate of authority   registration . . . . . . . . . . . . . . . . $100    s. Statement of cancellation . . . . . . . . . . . . . . . . . . . . . $ 10    t. Certificate of revocation    of authority to transact business . . . . . . . . . . . . . . . . . . No fee    u. Statement of correction . . . . . . . . . . . . . . . . . . . . . . . $ 5    v. Application for certificate of    existence or authorization   registration . . . . . . . . . . . . . . $ 5    w. Any other document required or    permitted to be filed by this chapter . . . . . . . . . . . . . . . . $ 5    2. The secretary of state shall collect a fee of five    dollars each time process is served on the secretary under this    chapter . The party to a proceeding causing service of process    is entitled to recover this fee as costs if the party prevails    in the proceeding.    3. The secretary of state shall collect the following fees    for copying and certifying the copy of any filed document          

  House File 655, p. 26   relating to a domestic   limited liability company or foreign    limited liability company as follows :    a. One dollar a page for copying.    b. Five dollars for the certificate.    4. The secretary of state may impose, assess, and collect    a filing fee as a condition to accepting a biennial report as    provided in section 489.209 .    Sec. 18. NEW SECTION   . 489.118 Change of name or address by    registered agent.    1. If a registered agent changes its name or address,    the agent may deliver to the secretary of state for filing a    statement of change that states all of the following:    a. The name of the limited liability company or registered    foreign limited liability company represented by the registered    agent.    b. The name of the agent as currently shown in the records    of the secretary of state for the limited liability company or    registered foreign limited liability company.    c. If the name of the agent has changed, its new name.    d. If the address of the agent has changed, its new address.    2. A registered agent promptly shall furnish notice to the    represented limited liability company or registered foreign    limited liability company of the filing by the secretary of    state of the statement of change and the changes made by the    statement.    Sec. 19. NEW SECTION   . 489.120 Delivery of record.    1. Except as otherwise provided in this chapter,    permissible means of delivery of a record include delivery by    hand, mail, conventional commercial practice, and electronic    transmission.    2. Delivery to the secretary of state is effective only when    a record is received by the secretary of state.    Sec. 20. NEW SECTION   . 489.121 Reservation of power to amend    or repeal.    The general assembly has power to amend or repeal all or    part of this chapter at any time, and all limited liability    companies and foreign limited liability companies subject to    this chapter are governed by the amendment or repeal.    Sec. 21. Section 489.201, Code 2023, is amended to read as         

  House File 655, p. 27   follows:    489.201 Formation of limited liability company  certificate    of organization.    1. One or more persons may act as organizers to form a    limited liability company by signing and   delivering to the    secretary of state for filing a certificate of organization.    2. A certificate of organization must state all of the    following:    a. The name of the limited liability company, which must    comply with section 489.108 .    b. The street address   and mailing addresses of the initial    registered office and the name of the initial registered    agent for service of process on the company limited liability    companys principal office   .    c. The name and street and mailing addresses in this state    of the limited liability companys registered agent.      3. Subject to section 489.112, subsection 3 , a A certificate    of organization may also contain statements as to matters other    than those required by subsection 2 , but shall not vary or      otherwise affect the provisions specified in section 489.110,    subsections 3 and 4, in a manner inconsistent with that    section   . However, a statement in a certificate of organization    is not effective as a statement of authority.    4. A limited liability company is formed when the secretary      of state has filed the certificate of organization , unless the    certificate states a delayed becomes effective date pursuant    to section 489.205, subsection 3 . If the certificate states    a delayed effective date, a limited liability company is not    formed if, before the certificate takes effect, a statement of      cancellation is signed and delivered to the secretary of state    for filing and the secretary of state files the certificate.      5. Subject to any delayed effective date and except in    a proceeding by this state to dissolve a limited liability      company, the filing of the certificate of organization by the    secretary of state is conclusive proof that the organizer      satisfied all conditions to the formation of a limited    liability company.      Sec. 22. Section 489.202, Code 2023, is amended to read as    follows:                                               

  House File 655, p. 28   489.202 Amendment or restatement of certificate of    organization.    1. A certificate of organization may be amended or restated    at any time.    2. To amend its certificate of organization, a limited    liability company must deliver to the secretary of state for    filing an amendment stating all of the following:    a. The name of the limited liability   company.    b. The date of filing of its initial   certificate of    organization .    c. The changes the amendment makes to the certificate as      most recently amended or restated text of the amendment .    3. To restate its certificate of organization, a limited    liability company must deliver to the secretary of state for    filing a restatement, designated as such in its heading,    stating   and setting forth all of the following:    a. In the heading or an introductory paragraph, the    companys present name and the date of the filing of the    companys initial certificate of organization   The name of the    limited liability company .    b. If the companys name has been changed at any time since    the companys formation, each of the companys former names   The    text of the restated certificate of organization .    c. The changes the restatement makes to the certificate as      most recently amended or restated A statement that the restated    certificate consolidates all amendments into a single document .    d. If a new amendment is included in the restated    certificate of organization, the statements required under    subsection 2 with respect to the new amendment if not otherwise      provided.    4. Subject to   section 489.112, subsection 3 , and section    489.205, subsection 3 , an amendment to or restatement of a    certificate of organization is effective when filed by the      secretary of state. If a member of a member-managed limited    liability company, or a manager of a manager-managed limited      liability company, knows that any information in a filed    certificate of organization was inaccurate when the certificate      of organization was filed or has become inaccurate due to    changed circumstances, the member or manager shall promptly do                                             

  House File 655, p. 29   any of the following:      a. Cause the certificate of organization to be amended.    b.   If appropriate, deliver to the secretary of state    for filing a statement of change under section 489.114 or a      statement of correction under section 489.206.    5.   If a member of a member-managed limited liability    company, or a manager of a manager-managed limited liability      company, knows that any information in a filed certificate of    organization was inaccurate when the certificate was filed      or has become inaccurate owing to changed circumstances, the    member or manager shall promptly do any of the following:      a. Cause the certificate to be amended.    b. If appropriate, deliver to the secretary of state    for filing a statement of change under   section 489.114 or a    statement of correction under section 489.206 .    Sec. 23. Section 489.203, Code 2023, is amended to read as    follows:    489.203 Signing of records to be delivered for filing to    secretary of state.      1. A record delivered to the secretary of state for filing    pursuant to this chapter must be signed as follows:    a. Except as otherwise provided in paragraphs b and c , a    record signed on behalf of   by a limited liability company must    be signed by a person authorized by the company.    b. A limited liability companys initial certificate of    organization must be signed by at least one person acting as    an organizer.    c. A record filed   delivered on behalf of a dissolved limited    liability company that does not have or has not had at least      one has no member must be signed by an organizer the person    winding up the companys activities and affairs under section      489.702, subsection 3, or a person appointed under section    489.702, subsection 4, to wind up the activities and affairs   .    d. A record filed on behalf of a dissolved limited liability    company that has no members must be signed by the person      winding up the companys activities under   section 489.702,    subsection 3   , or a person appointed under section 489.702,    subsection 4 , to wind up those activities A statement of denial    by a person under section 489.303 must be signed by that                                                        

  House File 655, p. 30   person   .    e. A statement of cancellation under section 489.201,    subsection 4   , must be signed by each organizer that signed    the initial certificate of organization, but a personal      representative of a deceased or incompetent organizer may sign    in the place of the decedent or incompetent   Any other record    delivered on behalf of a person to the secretary of state for      filing must be signed by that person .    f.   A statement of denial by a person under section 489.303    must be signed by that person.    g.   Any other record must be signed by the person on whose    behalf the record is delivered to the secretary of state.    2. Any A record filed delivered for filing under this    chapter may be signed by an agent. Whenever this chapter      requires a particular individual to sign a record and the    individual is deceased or incompetent, the record may be signed      by a legal representative of the individual.    3. A person that signs a record as an agent or legal    representative affirms as a fact that the person is authorized      to sign the record.    Sec. 24. Section 489.204, Code 2023, is amended to read as    follows:    489.204 Signing and filing pursuant to judicial order.    1. If a person required by this chapter to sign a record    or deliver a record to the secretary of state for filing under    this chapter does not do so, any other person that is aggrieved    may petition the district court to order one or more of the    following:    a. The person to sign the record.    b. The person to deliver the record to the secretary of    state for filing.    c. The secretary of state to file the record unsigned.    2. If a petitioner under subsection 1 is not the limited    liability company or foreign limited liability company to which    the record pertains, the petitioner shall make the limited      liability company or foreign limited liability company a party    to the action.    3. If a district court orders an unsigned record to be      delivered to the secretary of state, the secretary of state                                         

  House File 655, p. 31   shall file the record and the court order upon receipt   A record    filed under subsection 1, paragraph c , is effective without    being signed   .    Sec. 25. Section 489.205, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.205 Liability for inaccurate information in filed    records.    1. If a record delivered to the secretary of state for    filing under this chapter and filed by the secretary of state    contains inaccurate information, a person that suffers loss by    reliance on the information may recover damages for the loss    from all of the following:    a. A person that signed the record, or caused another to    sign it on the persons behalf, and knew the information to be    inaccurate at the time the record was signed.    b. Subject to subsection 2, a member of a member-managed    limited liability company or a manager of a manager-managed    limited liability company if all of the following apply:    (1) The record was delivered for filing on behalf of the    limited liability company.    (2) The member or manager knew or had notice of the    inaccuracy for a reasonably sufficient time before the    information was relied upon so that, before the reliance,    the member or manager reasonably could have done any of the    following:    (a) Effected an amendment under section 489.202.    (b) Filed a petition under section 489.204.    (c) Delivered to the secretary of state for filing a    statement of change under section 489.114 or a statement of    correction under section 489.206.    2. To the extent the operating agreement of a member-managed    limited liability company expressly relieves a member of    responsibility for maintaining the accuracy of information    contained in records delivered on behalf of the limited      liability company to the secretary of state for filing under    this chapter and imposes that responsibility on one or more    other members, the liability stated in subsection 1, paragraph    b , applies to those other members and not to the member that    the operating agreement relieves of the responsibility.         

  House File 655, p. 32   3. A person commits a serious misdemeanor if that person    signs a record the person knows is false in any material    respect with intent that the record be delivered to the    secretary of state for filing.    Sec. 26. Section 489.206, Code 2023, is amended to read as    follows:    489.206 Correcting filed record.    1. A limited liability company or foreign limited liability      company may deliver to the secretary of state for filing      a statement of correction to correct a record previously    delivered by the company to the secretary of state and filed      by the secretary of state, if at the time of filing the record    contained inaccurate information or was defectively signed.    A person on whose behalf a filed record was delivered to the      secretary of state for filing may correct the record if any of    the following apply:      a. The record at the time of filing was inaccurate.    b. The record was defectively signed.    c.   The electronic transmission of the record to the    secretary of state was defective.    2. A statement of correction under subsection 1 shall not    have a delayed effective date and must do all of the following:      To correct a filed record, a person on whose behalf the record    was delivered to the secretary of state must deliver to the      secretary of state for filing a statement of correction.    a. Describe the record to be corrected, including its filing    date, or attach a copy of the record as filed.    b. Specify the inaccurate information and the reason it is    inaccurate or the manner in which the signing was defective.      c. Correct the defective signature or inaccurate    information.      3. When filed by the secretary of state, a statement of    correction under   subsection 1 is effective retroactively as    of the effective date of the record the statement corrects,    but the statement is effective when filed as to   A statement of    correction shall comply with all of the following:    a. For the purposes of   section 489.103, subsection 4 It must    not state a delayed effective date .    b. As to persons that previously relied on the uncorrected                                                      

  House File 655, p. 33   record and would be adversely affected by the retroactive      effect It must be signed by the person correcting the filed    record   .    c.   It must describe the record to be corrected including its    filing date or attach a copy of the record as filed.    d.   It must specify the inaccuracy or defect to be corrected.    e.   It must correct the inaccuracy or defect.    4. A statement of correction is effective as of the    effective date of the filed record that it corrects except for      purposes of section 489.103, subsection 4, and as to persons    relying on the uncorrected filed record and adversely affected      by the correction. For those purposes and as to those persons,    the statement of correction is effective when filed.    Sec. 27. NEW SECTION   . 489.206A Filing requirements.    1. To be filed by the secretary of state pursuant to    this chapter, a record must be captioned to describe the    records purpose, must be received by the secretary of state,    must comply with this chapter, and must satisfy all of the    following:    a. The filing of the record must be required or permitted by    this chapter.    b. The record must be physically delivered in written    form unless and to the extent the secretary of state permits    electronic delivery of records.    c. The words in the record must be in English, and numbers    must be in Arabic or Roman numerals, but the name of an entity    need not be in English if written in English letters or Arabic    or Roman numerals.    d. The record must be signed by a person authorized or    required under this chapter to sign the record.    e. The record must state the name and capacity, if    any, of each individual who signed it, either on behalf    of the individual or the person authorized or required to    sign the record, but need not contain a seal, attestation,    acknowledgment, or verification.    2. If law other than this chapter prohibits the disclosure    by the secretary of state of information contained in a record    delivered to the secretary of state for filing, the secretary    of state shall file the record if the record otherwise complies                          

  House File 655, p. 34   with this chapter but may redact the information.    3. When a record is delivered to the secretary of state for    filing, any fee required under this chapter and any fee, tax,    interest, or penalty required to be paid under this chapter or    law other than this chapter must be paid in a manner permitted    by the secretary of state or by that law.    4. The secretary of state may require that a record    delivered in written form be accompanied by an identical or    conformed copy.    5. The secretary of state may provide forms for filings    required or permitted to be made by this chapter, but, except    as otherwise provided in subsection 6, their use is not    required.    6. The secretary of state may prescribe, and furnish on    request and require any of the following forms:    a. A cover sheet for a filing.    b. An application for a certificate of existence or    certificate of registration.    c. A foreign corporations registration statement.    d. A foreign corporations statement of withdrawal.    e. A foreign corporations transfer of registration    statement.    f. The biennial report required by section 489.209.    7. Upon request and payment of the requisite fee, the    secretary of state shall send the requester a certified copy    of a requested record.    Sec. 28. Section 489.207, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.207 Effective date and time.    Except as otherwise provided in section 489.115 and section    489.208A and subject to section 489.206, subsection 4, a record    filed under this chapter is effective as follows:    1. On the date and at the time of its filing by the    secretary of state, as provided in section 489.210, subsection    2.    2. On the date of filing and at the time specified in the    record as its effective time, if later than the time under    subsection 1.      3. At a specified delayed effective date and time, which may   

  House File 655, p. 35   not be more than ninety days after the date of filing.    4. If a delayed effective date is specified, but no time is    specified, at 12:01 a.m. on the date specified, which shall not    be more than ninety days after the date of filing.    Sec. 29. Section 489.208, Code 2023, is amended to read as    follows:    489.208 Certificate of existence or authorization      registration .    1. Any person may apply to   On request of any person, the    secretary of state to be furnished shall issue a certificate    of existence for a domestic   limited liability company or a    certificate of authorization registration for a registered    foreign limited liability company.    2. A certificate of existence or certificate of    authorization   registration under subsection 1 must set forth    state   all of the following:    a. The domestic limited liability companys name or the    registered foreign limited liability companys name used in    this state.    b. One   In the case of a limited liability company, all of    the following:    (1) If it is a domestic limited liability company, that      the company is duly formed under the laws of this state, the    date of its formation, and the period of its duration   That    a certificate of organization has been filed and has taken    effect .    (2) If it is a foreign limited liability company, that the    company is authorized to transact business in this state The    date the certificate became effective   .    (3) The period of the limited liability companys duration    if the records of the secretary of state reflect that its      period of duration is less than perpetual.    (4)   That all of the following apply:    (a) No statement of dissolution, statement of    administrative dissolution, or statement of termination has      been filed.    (b)   The records of the secretary of state do not otherwise    reflect that the limited liability company has been dissolved    or terminated.                                                 

  House File 655, p. 36   (c)   A proceeding is not pending under section 489.705.    c. That all fees, taxes, and penalties due under this    chapter   or other law to the secretary of state have been paid    In the case of a registered foreign limited liability company,      that it is registered to do business in this state .    d. That the companys most recent biennial report required      by   this chapter has been filed by the secretary of state That    all fees, taxes, interest, and penalties owed to this state    by the limited liability company or foreign limited liability      company and collected through the secretary of state have been    paid, if all of the following apply:      (1) Payment is reflected in the records of the secretary of    state .    (2)   Nonpayment affects the good standing or registration    of the limited liability company or foreign limited liability    company.      e. If it is a domestic limited liability company, that a    statement of dissolution or statement of termination has not    been filed   That the most recent biennial report required by    section 489.209 has been delivered to the secretary of state    for filing .    f. Other facts of record in the office   reflected in the    records of the secretary of state that may be requested by    the applicant   pertaining to the limited liability company or    foreign limited liability company which the person requesting    the certificate reasonably requests .    3. Subject to any qualification stated in the certificate, a    certificate of existence or certificate of authorization issued    by the secretary of state is   under subsection 1 may be relied    on as conclusive evidence that the domestic limited liability    company is in existence or the foreign limited liability      company is authorized to transact business in this state of the    facts stated in the certificate   .    Sec. 30. NEW SECTION . 489.208A Withdrawal of filed record      before effectiveness.      1. Except as otherwise provided in sections 489.1024,    489.1034, 489.1044, and 489.1054, a record delivered to the    secretary of state for filing may be withdrawn before it takes    effect by delivering to the secretary of state for filing a                                                      

  House File 655, p. 37   statement of withdrawal.    2. A statement of withdrawal must comply with all of the    following:    a. Be signed by each person that signed the record being    withdrawn, except as otherwise agreed by those persons.    b. Identify the record to be withdrawn.    c. If signed by fewer than all the persons that signed the    record being withdrawn, state that the record is withdrawn in    accordance with the agreement of all the persons that signed    the record.    3. On filing by the secretary of state of a statement of    withdrawal, the action or transaction evidenced by the original    record does not take effect.    Sec. 31. Section 489.209, Code 2023, is amended to read as    follows:    489.209 Biennial report for secretary of state.    1. A limited liability company or a foreign limited    liability company authorized registered to transact do business    in this state shall deliver to the secretary of state for    filing a biennial report that states all of the following:    a. The name of the company.    b. The street address of the companys registered office,    the name of its registered agent at that office, and the    consent of any new registered agent.    c. The street address of its principal office.    d. In the case of a foreign limited liability company, the    state or other jurisdiction under whose law the foreign   company    is formed and any alternate name adopted under section 489.805,    subsection 1 .    2. Information in a biennial report under this section    must be current as of the date the report is delivered to the    secretary of state for filing. The report shall be executed    on behalf of the limited liability company or foreign limited    liability company and signed as provided in section 489.203 .    3. The first biennial report under   this section in this    state must be delivered to the secretary of state between    January 1 and April 1 of the first odd-numbered year following    the calendar year in which a limited liability company was    formed or a foreign limited liability company was authorized               

  House File 655, p. 38   registered   to transact do business. A subsequent biennial    report must be delivered to the secretary of state between    January 1 and April 1 of each following odd-numbered calendar    year. A filing fee for the biennial report shall be determined    by the secretary of state pursuant to section 489.117 . Each    biennial report shall contain information related to the    two-year period immediately preceding the calendar year in    which the report is filed.    4. If a biennial report does not contain the information    required in this section , the secretary of state shall promptly    notify the reporting limited liability company or foreign    limited liability company in writing and return the report to    it for correction.    5. The secretary of state may provide for the change of    registered office or registered agent on the form prescribed by    the secretary of state for the biennial report, provided that    the form contains the information required in section 489.114 .    If the secretary of state determines that a biennial report    does not contain the information required in this section but    otherwise meets the requirements of section 489.114 for the    purpose of changing the registered office or registered agent,    the secretary of state shall file the statement of change    for the registered office or registered agent, effective as    provided in section 489.205   489.207 , subsection 3 , before    returning the biennial report to the limited liability    company as provided in this section . A statement of change of    registered office or registered agent accomplished pursuant to    this subsection shall be executed by a person authorized to    execute the biennial report.    Sec. 32. NEW SECTION   . 489.210 Duty of secretary of state    to file  review of refusal to file  delivery of record by    secretary of state.    1. The secretary of state shall file a record delivered    to the secretary of state for filing which satisfies this    chapter. The duty of the secretary of state under this section    is ministerial.      2. When the secretary of state files a record, the secretary    of state shall record it as filed on the date and at the time of    its delivery. After filing a record, the secretary of state         

  House File 655, p. 39   shall deliver to the person that submitted the record a copy    of the record with an acknowledgment of the date and time of    filing and, in the case of a statement of denial, also to the    limited liability company to which the statement pertains.    3. If the secretary of state refuses to file a record, the    secretary of state shall, not later than fifteen business days    after the record is delivered, do all of the following:    a. Return the record or notify the person that submitted the    record of the refusal.    b. Provide a brief explanation in a record of the reason for    the refusal.    4. If the secretary of state refuses to file a record, the    person that submitted the record may petition the district    court of Polk county to compel filing of the record. The    record and the explanation of the secretary of state of    the refusal to file must be attached to the petition. The    court may decide the matter in a summary proceeding. If the    court orders the record to be filed, the court may order it    filed with an effective date that is the date on which it was    submitted to the secretary of state for filing.    5. The filing of or refusal to file a record does not do any    of the following:    a. Affect the validity or invalidity of the record in whole    or in part.    b. Create a presumption that the information contained in    the record is correct or incorrect.    6. Except as otherwise provided by section 489.116 or by law    other than this chapter, the secretary of state may deliver any    record to a person by delivering it by any of the following:    a. In person to the person that submitted it.    b. To the address of the persons registered agent.    c. To the principal office of the person.    d. To another address the person provides to the secretary    of state for delivery.    Sec. 33. Section 489.302, Code 2023, is amended to read as    follows:      489.302 Statement of limited liability company   authority.    1. A limited liability company may deliver to the secretary    of state for filing a statement of authority. All of the    

  House File 655, p. 40   following apply to the statement:    a. It must include the name of the limited liability   company    and the name and   street address and mailing addresses of its    principal office   registered agent .    b. With respect to any position that exists in or with    respect to the limited liability   company, it may state the    authority, or limitations on the authority, of all persons    holding the position to do any of the following:    (1) Execute   Sign an instrument transferring real property    held in the name of the limited liability company.    (2) Enter into other transactions on behalf of, or otherwise    act for or bind, the limited liability   company.    c. It may state the authority, or limitations on the    authority, of a specific person to do any of the following:    (1) Execute   Sign an instrument transferring real property    held in the name of the limited liability   company.    (2) Enter into other transactions on behalf of, or otherwise    act for or bind, the limited liability company.    2. To amend or cancel a statement of authority filed by    the secretary of state under   section 489.205, subsection 1 ,    a limited liability company must deliver to the secretary of    state for filing an amendment or cancellation stating all of    the following:    a. The name of the limited liability   company.    b. The name and street address and mailing addresses of the    limited liability companys principal office registered agent .    c. The caption of the statement being amended or canceled    and the date the statement being affected became effective.    d. The contents of the amendment or a declaration that the    statement being affected   is canceled.    3. A statement of authority affects only the power of a    person to bind a limited liability company to persons that are    not members.    4. Subject to subsection 3 and section 489.103, subsection    4 , and except as otherwise provided in subsections 6, 7, and    8 , a limitation on the authority of a person or a position    contained in an effective statement of authority is not by    itself evidence of any persons   knowledge or notice of the    limitation by any person .                                

  House File 655, p. 41   5. Subject to subsection 3 , a grant of authority not    pertaining to a transfer of real property and contained in an    effective statement of authority is conclusive in favor of a    person that gives value in reliance on the grant, except to the    extent that when the person gives value, any of the following    applies:    a. The person has knowledge to the contrary.    b. The statement has been canceled or restrictively amended    under subsection 2 .    c. A limitation on the grant is contained in another    statement of authority that became effective after the    statement containing the grant became effective.    6. Subject to subsection 3 , an effective statement of    authority that grants authority to transfer real property    held in the name of the limited liability company and that   , a    certified copy of which statement   is recorded by certified copy    in the office for recording transfers of the real property , is    conclusive in favor of a person that gives value in reliance    on the grant without knowledge to the contrary, except to the    extent that when the person gives value, any of the following    applies:    a. The statement has been canceled or restrictively amended    under subsection 2 and a certified copy of the cancellation    or restrictive amendment has been recorded in the office for    recording transfers of the real property.    b. A limitation on the grant is contained in another    statement of authority that became effective after the    statement containing the grant became effective ,   and a    certified copy of the later-effective statement is recorded in    the office for recording transfers of the real property.    7. Subject to subsection 3 , if a certified copy of an    effective statement containing a limitation on the authority to    transfer real property held in the name of a limited liability    company is recorded in the office for recording transfers of    that real property, all persons are deemed to know of the    limitation.      8. Subject to subsection 9 , an effective statement of    dissolution or a   statement of termination is a cancellation    of any filed statement of authority for the purposes of          

  House File 655, p. 42   subsection 6 and is a limitation on authority for the purposes    of subsection 7 .    9. After a statement of dissolution becomes effective,    a limited liability company may deliver to the secretary of    state for filing and, if appropriate, the secretary of state      may record a statement of authority that is designated as    a post-dissolution statement of authority. The statement    operates as provided in subsections 6 and 7 .    10. A statement of authority filed by the secretary of    state under section 489.205   489.207 , subsection 1 , is effective    until amended or canceled as provided in subsection 2 , unless    an earlier cancellation date is specified in the statement.    11. An effective statement of denial operates as a    restrictive amendment under this section and may be recorded by    certified copy for the   purposes of subsection 6 , paragraph a .    Sec. 34. Section 489.304, Code 2023, is amended to read as    follows:    489.304 Liability of members and managers.    1. For debts, obligations, or other liabilities   A debt,    obligation, or other liability of a limited liability    company , whether arising in contract, tort, or otherwise    all of the following apply:   is solely the debt, obligation,    or other liability of the company. A member or manager is    not personally liable, directly or indirectly, by way of      contribution or otherwise, for a debt, obligation, or other    liability of the company solely by reason of being or acting    as a member or manager. This subsection applies regardless of    the dissolution of the company.    a.   They are solely the debts, obligations, or other    liabilities of the company.    b.   They do not become the debts, obligations, or other    liabilities of a member or manager solely by reason of the    member acting as a member or manager acting as a manager.      2. The failure of a limited liability company to observe any    particular   formalities relating to the exercise of its powers    or management of its activities and affairs is not a ground    for imposing liability on the members   a member or managers    manager for the debts, obligations, a debt, obligation, or    other liabilities liability of the company.                                       

  House File 655, p. 43   Sec. 35. Section 489.401, Code 2023, is amended to read as    follows:    489.401 Becoming member.    1. If a limited liability company is to have only one member    upon formation, a   the person becomes the a member as agreed by    that person and the organizer of the company or a majority of      organizers if more than one   . That person and the organizer    may be, but need not be, different persons. If different, the    organizer acts on behalf of the initial member.    2. If a limited liability company is to have more than    one member upon formation, those persons become members as    agreed by the persons before the formation of the company. The    organizer acts on behalf of the persons in forming the company    and may be, but need not be, one of the persons.    3. If a limited liability company has no members upon      formation, a person becomes a member of the limited liability      company with the consent of the organizer or a majority of    the organizers if more than one. The organizers may consent    to more than one person simultaneously becoming the companys      initial members After formation of a limited liability company,    a person becomes a member according to any of the following:    a.   As provided in the operating agreement .    b. As the result of a transaction effective under subchapter    X.      c. With the affirmative vote or consent of all the members.    d. As provided in section 489.701, subsection 1, paragraph    c .    4. After formation of a limited liability company, a person    becomes a member upon   A person may become a member without any    of the following:    a. As provided in the operating agreement   Acquiring a    transferable interest .      b. As the result of a transaction effective under article 10      Making or being obligated to make a contribution to the limited    liability company   .    c. With the consent of all the members.    d.   If, within ninety consecutive days after the company    ceases to have any members, all of the following occur:    (1)   The last person to have been a member, or the legal                                                   

  House File 655, p. 44   representative of that person, designates a person to become a      member.    (2)   The designated person consents to become a member.    5.   A person may become a member without acquiring a    transferable interest and without making or being obligated to    make a contribution to the limited liability company.      Sec. 36. Section 489.402, Code 2023, is amended to read as    follows:    489.402 Form of contribution.    A contribution may consist of tangible or intangible      property or other benefit to a limited liability company,      including money, services performed, promissory notes, other    agreements to contribute money or property, and contracts for    services to be performed   property transferred to, services    performed for, or another benefit provided to the limited    liability company or an agreement to transfer property to,      perform services for, or provide another benefit to the    company .    Sec. 37. Section 489.403, Code 2023, is amended to read as    follows:    489.403 Liability for contributions.    1. A persons obligation to make a contribution to a    limited liability company is not excused by the persons    death, disability, termination,   or other inability to perform    personally. If a person does not make a required contribution,    the person or the persons estate is obligated to contribute    money equal to the value of the part of the contribution which    has not been made, at the option of the company.    2. A creditor of a limited liability company which extends      credit or otherwise acts in reliance on an obligation described    in   subsection 1 may enforce the obligation If a person does not    fulfill an obligation to make a contribution other than money,    the person is obligated at the option of the limited liability      company to contribute money equal to the value of the part of    the contribution which has not been made   .    3. An operating agreement may provide that the interest of    any member who fails to make a contribution that the member      is obligated to make is subject to specified penalties for,    or specified consequences of, such failure. The penalty or                                          

  House File 655, p. 45   consequence may take the form of reducing or eliminating      the defaulting members proportionate interest in a limited    liability company, subordinating the members interest to      that of a nondefaulting member, a forced sale of the members      interest, forfeiture of the members interest, the lending by    other members of the amount necessary to meet the members      commitment, a fixing of the value of the members interest      by appraisal or by formula and redemption, or sale of the    members interest at such value or other penalty or consequence      The obligation of a person to make a contribution may be    compromised only by the affirmative vote or consent of all the      members. If a creditor of a limited liability company extends    credit or otherwise acts in reliance on an obligation described    in subsection 1 without knowledge or notice of a compromise      under this subsection, the creditor may enforce the obligation .    4.   An operating agreement may provide that the interest of    any member who fails to make a contribution that the member    is obligated to make is subject to specified penalties for,    or specified consequences of, such failure. The penalty or      consequence may take the form of reducing or eliminating    the defaulting members proportionate interest in a limited    liability company, subordinating the members interest to      that of a nondefaulting member, a forced sale of the members    interest, forfeiture of the members interest, the lending by      other members of the amount necessary to meet the members    commitment, a fixing of the value of the members interest by    appraisal or by formula and redemption, or sale of the members    interest at such value or other penalty or consequence.    Sec. 38. Section 489.404, Code 2023, is amended to read as    follows:    489.404 Sharing of and right to distributions before    dissolution.      1. Any distributions   distribution made by a limited    liability company before its dissolution and winding up must    be in equal shares among members and persons   dissociated as    members, except to the extent necessary to comply with any a    transfer effective under section 489.502 and any charging order    in effect under section 489.503 .    2. A person has a right to a distribution before the                                       

  House File 655, p. 46   dissolution and winding up of a limited liability company only    if the limited liability   company decides to make an interim    distribution. A persons dissociation does not entitle the    person to a distribution.    3. A person does not have a right to demand or receive a    distribution from a limited liability company in any form other    than money. Except as otherwise provided in section 489.708,    subsection 3   4 , a limited liability company may distribute an    asset in kind only   if each part of the asset is fungible with    each other part and each person receives a percentage of the    asset equal in value to the persons share of distributions.    4. If a member or transferee becomes entitled to receive a    distribution, the member or transferee has the status of, and    is entitled to all remedies available to, a creditor of the    limited liability company with respect to the distribution.    However, the companys obligation to make a distribution is      subject to offset for any amount owed to the company by the    member or a person dissociated as a member on whose account the    distribution is made.      Sec. 39. Section 489.405, Code 2023, is amended to read as    follows:    489.405 Limitations on distribution.    1. A limited liability company shall not make a    distribution , including a distribution under section 489.708,      if after the distribution any of the following applies:    a. The limited liability company would not be able to pay    its debts as they become due in the ordinary course of the    companys activities and affairs .    b. The limited liability   companys total assets would be    less than the sum of its total liabilities plus the amount that    would be needed, if the company were to be dissolved ,   and wound    up , and terminated at the time of the distribution, to satisfy    the preferential rights upon dissolution ,   and winding up, and    termination of members up of members and transferees whose    preferential rights are superior to those   the rights of persons    receiving the distribution.    2. A limited liability company may base a determination    that a distribution is not prohibited under subsection 1 on    financial statements prepared on the basis of accounting                            

  House File 655, p. 47   practices and principles that are reasonable in the      circumstances or on a fair valuation or other method that is    reasonable under the circumstances   any of the following:    a.   Financial statements prepared on the basis of    accounting practices and principles that are reasonable in the    circumstances   .    b.   A fair valuation or other method that is reasonable under    the circumstances.    3. Except as otherwise provided in subsection 5 , the effect    of a distribution under subsection 1 is measured as follows:    a. In the case of a distribution by purchase, redemption, or      other acquisition of a transferable interest in the company,    as of the date money or other property is transferred or    debt incurred by the company   as defined in section 489.102,    subsection 5, paragraph a , as of the earlier of any of the    following:      (1) The date money or other property is transferred or debt    is incurred by the limited liability company .    (2)   The date the person entitled to the distribution ceases    to own the interest or right being acquired by the limited    liability company in return for the distribution.    b.   In the case of any other distribution of indebtedness, as    of the date the indebtedness is distributed.    b.   c. In all other cases , as follows any of the following :    (1) The date that the distribution is authorized, if the    payment occurs within not later than one hundred twenty days    after that date.    (2) The date that the payment is made, if the payment occurs    more than one hundred twenty days after the distribution is    authorized.    4. A limited liability companys indebtedness to a member    or transferee   incurred by reason of a distribution made in    accordance with this section is at parity with the companys    indebtedness to its general, unsecured creditors , except to the      extent subordinated by agreement   .    5. A limited liability companys indebtedness, including    indebtedness issued in connection with or as part of   as a    distribution, is not a liability for purposes of subsection    1 if the terms of the indebtedness provide that payment of                                                     

  House File 655, p. 48   principal and interest are   is made only if and to the extent    that payment of a distribution could then be made to members    under this section . If the   indebtedness is issued as a    distribution, each payment of principal or interest on the      indebtedness is treated as a distribution, the effect of which    is measured on the date the payment is made.    6. In   subsection 1 , distribution does not include amounts    constituting reasonable compensation for present or past    services or reasonable payments made in the ordinary course of      business under a bona fide retirement plan or other benefits    program   In measuring the effect of a distribution under section    489.708, the liabilities of a dissolved limited liability    company do not include any claim that has been disposed of    under section 489.703, 489.704, or 489.706A   .    Sec. 40. Section 489.406, Code 2023, is amended to read as    follows:    489.406 Liability for improper distributions.    1. Except as otherwise provided in subsection 2 , if a member    of a member-managed limited liability company or a   manager    of a manager-managed limited liability company consents to    a distribution made in violation of section 489.405 and in    consenting to the distribution fails to comply with section    489.409 , the member or manager is personally liable to the    company for the amount of the distribution that   which exceeds    the amount that could have been distributed without the    violation of section 489.405 .    2. To the extent the operating agreement of a member-managed    limited liability company expressly relieves a member of the    authority and responsibility to consent to distributions and    imposes that authority and responsibility on one or more other    members, the liability stated in subsection 1 applies to the    other members and not the member that the operating agreement    relieves of the   authority and responsibility.    3. A person that receives a distribution knowing that the    distribution to that person was made in violation of   violated    section 489.405 is personally liable to the limited liability    company but only to the extent that the distribution received    by the person exceeded the amount that could have been properly    paid under section 489.405 .                               

  House File 655, p. 49   4. A person against which an action is commenced because    the person is liable under subsection 1 may do all of the    following:    a. Implead any other person that is subject to liability      liable under subsection 1 and seek to compel enforce a right of    contribution from the person.    b. Implead any person that received a distribution in    violation of subsection 3 and seek to compel   enforce a right of    contribution from the person in the amount the person received    in violation of subsection 3 .    5. An action under this section is barred if not      unless commenced within not later than two years after the    distribution.    Sec. 41. Section 489.407, Code 2023, is amended to read as    follows:    489.407 Management of limited liability company.    1. A limited liability company is a member-managed limited    liability company unless the operating agreement does any of    the following:    a. Expressly provides that any of the following apply:    (1) The limited liability   company is or will be    manager-managed.    (2) The limited liability   company is or will be managed by    managers.    (3) Management of the limited liability   company is or will    be vested in managers.    b. Includes words of similar import.    2. In a member-managed limited liability company, all of the    following rules apply:    a. The   Except as expressly provided in this chapter, the    management and conduct of the limited liability   company are    vested in the members.      b. Each member has equal rights in the management and    conduct of the limited liability   companys activities and    affairs   .      c. A difference arising among members as to a matter in the    ordinary course of the activities and affairs   of the limited    liability company may be decided by a majority of the members.    d. An act outside the ordinary course of the activities                          

  House File 655, p. 50   of the company, including selling, leasing, exchanging, or      otherwise disposing of all, or substantially all, of the    companys property, with or without the goodwill, may be      undertaken only with the consent of all members   The affirmative    vote or consent of all the members is required to do any of the    following:      (1)   Sell, lease, exchange, or otherwise dispose of all, or    substantially all, of the limited liability companys property,    with or without good will, outside the ordinary course of the      companys activities .    (2)   Undertake an act outside the ordinary course of the    activities and affairs of the limited liability company.    (3) Approve a merger, interest exchange, conversion, or    domestication under subchapter X.      (4) Amend the operating agreement.    e.   The operating agreement may be amended only with the    consent of all members.    3. In a manager-managed limited liability company, all of    the following rules apply:    a. Except as otherwise   expressly provided in this chapter ,    any matter relating to the activities and affairs of the    limited liability   company is decided exclusively by the    managers manager, or, if there is more than one manager, by a    majority of the managers   .    b. Each manager has equal rights in the management and    conduct of the activities and affairs of the limited liability    company.    c. A difference arising among managers as to a matter in the    ordinary course of the activities of the company may be decided      by a majority of the managers.    d.   c. The affirmative vote or consent of all members is    required to do any of the following:    (1) Sell, lease, exchange, or otherwise dispose of all, or    substantially all, of the limited liability   companys property,    with or without the   goodwill, outside the ordinary course of    the companys activities.    (2) Approve a merger, conversion, or domestication under      article 10 Undertake any other act outside the ordinary course    of the limited liability companys activities and affairs   .                                                     

  House File 655, p. 51   (3) Undertake any other act outside the ordinary course of      the companys activities Approve a merger, interest exchange,    conversion, or domestication under subchapter X   .    (4) Amend the operating agreement.    e.   d. A manager may be chosen at any time by the    affirmative vote or   consent of a majority of the members and    remains a manager until a successor has been chosen, unless the    manager at an earlier time resigns, is removed, or dies, or, in    the case of a manager that is not an individual, terminates. A    manager may be removed at any time by the affirmative vote or      consent of a majority of the members without notice or cause.    f.   e. A person need not be a member to be a manager, but    the dissociation of a member that is also a manager removes the    person as a manager. If a person that is both a manager and    a member ceases to be a manager, that cessation does not by    itself dissociate the person as a member.    g.   f. A persons ceasing to be a manager does not discharge    any debt, obligation, or other liability to the limited    liability company or members which the person incurred while    a manager.    4. An action requiring the vote or   consent of members under    this chapter may be taken without a meeting, and a member may    appoint a proxy or other agent to vote,   consent , or otherwise    act for the member by signing an appointing record, personally    or by the members agent.    5. The dissolution of a limited liability company does not    affect the applicability of this section . However, a person    that wrongfully causes dissolution of the company loses the    right to participate in management as a member and a manager.    6. This chapter   does not entitle a member to remuneration    for services performed for a member-managed limited liability      company, except for reasonable compensation for services    rendered in winding up the activities of the company   A limited    liability company shall reimburse a member for an advance to    the company beyond the amount of capital the member agreed to      contribute .      7.   A payment or advance made by a member which gives rise    to a limited liability company obligation under subsection 6    or section 489.408, subsection 1, constitutes a loan to the                                

  House File 655, p. 52   company which accrues interest from the date of the payment or      advance.    8.   A member is not entitled to remuneration for services    performed for a member-managed limited liability company,      except for reasonable compensation for services rendered in    winding up the activities of the company.      Sec. 42. Section 489.407A, Code 2023, is amended to read as    follows:    489.407A Real estate interest transferred by limited    liability company or foreign limited liability company.    1. A transfer of an interest in real estate situated in    this state held by a limited liability company or a registered      foreign limited liability company authorized to transact do    business in this state is subject to the provisions of this    section .    2. a. In a member-managed limited liability   company, a    transfer of an interest in real estate held by the company may    be undertaken by any of the following:    (1) As provided in the operating agreement, or if the    operating agreement does not so provide, only with the consent    of all members.    (2) As provided in a statement of authority filed by the    limited liability   company with the secretary of state and    the recorder of the county where the real estate is situated    pursuant to section 489.302 .    b. A requirement of paragraph a is applicable to every    transfer of an interest in real estate situated in this state    held by a member-managed limited liability   company, whether or    not the transfer is in the ordinary course of the companys    business.    3. a. In a manager-managed limited liability   company, a    transfer of an interest in real estate held by the company may    be undertaken by any of the following:    (1) As provided in the operating agreement, or if the    operating agreement does not so provide, only with the consent    of a majority of all managers.    (2) As provided in a statement of authority filed by the    limited liability   company with the secretary of state and    the recorder of the county where the real estate is situated                   

  House File 655, p. 53   pursuant to section 489.302 .    b. A requirement in paragraph a is applicable to every    transfer of an interest in real estate situated in this state    held by a manager-managed limited liability company, whether    or not the transfer is in the ordinary course of the companys    business.    Sec. 43. Section 489.408, Code 2023, is amended to read as    follows:    489.408 Indemnification   Reimbursement, indemnification,    advancement, and insurance.    1. A limited liability company shall reimburse a member of      a member-managed limited liability company or the manager of    a manager-managed limited liability company for any payment    made and indemnify for any debt, obligation, or other liability      incurred by a member of a member-managed company or the manager    of a manager-managed company in the course of the members      or managers activities on behalf of the company, if, in    making the payment or incurring the debt, obligation, or other    liability, the member or manager complied with the duties      stated in sections 489.405 and 489.409 by the member or manager    in the course of the members or managers activities on behalf    of the company, if the member or manager complied with sections      489.405, 489.407, and 489.409 in making the payment .    2. A limited liability company may purchase and maintain      insurance on behalf of a member or manager of the company    against liability asserted against or incurred by the member or    manager in that capacity or arising from that status even if,    under section 489.110, subsection 7 , the operating agreement    could not eliminate or limit the persons liability to the      company for the conduct giving rise to the liability A limited    liability company shall indemnify and hold harmless a person      with respect to any claim or demand against the person and any    debt, obligation, or other liability incurred by the person by      reason of the persons former or present capacity as a member      or manager, if the claim, demand, debt, obligation, or other      liability does not arise from the persons breach of section    489.405, 489.407, or 489.409   .      3.   In the ordinary course of its activities and affairs,    a limited liability company may advance reasonable expenses,                                            

  House File 655, p. 54   including attorneys fees and costs, incurred by a person      in connection with a claim or demand against the person by    reason of the persons former or present capacity as a member      or manager, if the person promises to repay the company if      the person ultimately is determined not to be entitled to be    indemnified under subsection 2.      4.   A limited liability company may purchase and maintain    insurance on behalf of a member or manager against liability    asserted against or incurred by the member or manager in that      capacity or arising from that status even if, under section    489.110, subsection 3, paragraph   g , the operating agreement    could not eliminate or limit the persons liability to the    company for the conduct giving rise to the liability.    Sec. 44. Section 489.409, Code 2023, is amended to read as    follows:    489.409 Standards of conduct for members and managers.    1. A member of a member-managed limited liability company    owes to the company and, subject to section 489.901, subsection    2 , the other members the fiduciary duties of loyalty and care    stated in subsections 2 and 3 .    2. The fiduciary   duty of loyalty of a member in a    member-managed limited liability company includes all of the    following duties:    a. To account to the limited liability   company and to hold    as trustee for it any property, profit, or benefit derived by    the member regarding any of the following:    (1) In the conduct or winding up of the limited liability    companys activities and affairs .    (2) From a use by the member of the limited liability      companys property.    (3) From the appropriation of a limited liability company    opportunity.    b. To refrain from dealing with the limited liability      company in the conduct or winding up of the companys    activities and affairs   as or on behalf of a person having an    interest adverse to the company.    c. To refrain from competing with the limited liability      company in the conduct of the companys activities and affairs    before the dissolution of the company.                             

  House File 655, p. 55   3. Subject to the business judgment rule as stated in      subsection 7 , the duty of care of a member of a member-managed    limited liability company in the conduct and winding up of the      companys activities is to act with the care that a person      in a like position would reasonably exercise under similar    circumstances and in a manner the member reasonably believes to      be in the best interests of the company. In discharging this      duty, a member may rely in good faith upon opinions, reports,    statements, or other information provided by another person      that the member reasonably believes is a competent and reliable    source for the information   The duty of care of a member of    a member-managed limited liability company in the conduct    or winding up of the companys activities and affairs is to    refrain from engaging in grossly negligent or reckless conduct,      willful or intentional misconduct, or knowing violation of law .    4. A member in a member-managed limited liability company      or a manager-managed limited liability company shall discharge    the duties under this chapter or under the operating agreement    and exercise any rights consistently with the contractual      obligation of good faith and fair dealing A member shall    discharge the duties and obligations under this chapter    or under the operating agreement and exercise any rights      consistently with the contractual obligation of good faith and    fair dealing   .    5. It is a defense to a claim under subsection 2 , paragraph    b , and any comparable claim in equity or at common law that    the transaction was fair to the limited liability company A    member does not violate a duty or obligation under this chapter    or under the operating agreement solely because the members      conduct furthers the members own interest .      6. All of   the members of a member-managed limited liability    company or a manager-managed limited liability company may    authorize or ratify, after full disclosure of all material    facts, a specific act or transaction that otherwise would    violate the duty of loyalty.    7. a.   A member satisfies the duty of care in subsection 3    if all of the following apply:   It is a defense to a claim under    subsection 2, paragraph b , and any comparable claim in equity    or at common law that the transaction was fair to the limited                                                     

  House File 655, p. 56   liability company.      (1) The member is not interested in the subject matter of    the business judgment.      (2)   The member is informed with respect to the subject    of the business judgment to the extent the member reasonably    believes to be appropriate in the circumstances.      (3)   The member has a rational basis for believing that    the business judgment is in the best interests of the limited    liability company.      b. A person challenging the business judgment of a member    has the burden of proving a breach of the duty of care, and      in a damage action, the burden of proving that the breach was    the legal cause of damage suffered by the limited liability    company.      8. In a manager-managed limited liability company, all of    the following rules apply:   If, as permitted by subsection 6    or subsection 9, paragraph f , or the operating agreement, a    member enters into a transaction with the limited liability    company which otherwise would be prohibited by subsection 2,      paragraph b , the members rights and obligations arising from    the transaction are the same as those of a person that is not a    member.      a. Subsections 1, 2, 3, 5, and 7 apply to the manager or    managers and not the members.      b. The duty stated under subsection 2 , paragraph c ,    continues until winding up is completed.    c. Subsection 4 applies to the members and managers.    d. Subsection 6 applies only to the members.    e.   A member does not have any fiduciary duty to the company    or to any other member solely by reason of being a member.    9.   In a manager-managed limited liability company, all of    the following rules apply:    a.   Subsections 1, 2, 3, and 7 apply to the manager or    managers and not the members.      b.   The duty stated under subsection 2, paragraph c ,    continues until winding up is completed.    c.   Subsection 4 applies to managers and members.    d. Subsection 5 applies only to members.    e. The power to ratify under subsection 6 may be exercised                                                                                      

  House File 655, p. 57   only by the members.      f. Subject to subsection 4, a member does not have any duty    to the limited liability company or to any other member solely      by reason of being a member.      Sec. 45. Section 489.410, Code 2023, is amended to read as    follows:    489.410 Right of members, managers, and dissociated members      to information Rights to information of member, manager, and    person dissociated as member   .    1. In a member-managed limited liability company, all of the    following rules apply:    a. On reasonable notice, a member may inspect and copy    during regular business hours, at a reasonable location    specified by the limited liability   company, any record    maintained by the company regarding the companys activities,    affairs,   financial condition, and other circumstances, to the    extent the information is material to the members rights and    duties under the operating agreement or this chapter .    b. The limited liability   company shall furnish to each    member all of the following:    (1) Without demand, any information concerning the limited    liability   companys activities, affairs, financial condition,    and other circumstances which the company knows and is material    to the proper exercise of the members rights and duties under    the operating agreement or this chapter , except to the extent    the company can establish that it reasonably believes the    member already knows the information.    (2) On demand, any other information concerning the limited      liability   companys activities, affairs, financial condition,    and other circumstances, except to the extent the demand or for    the   information demanded is unreasonable or otherwise improper    under the circumstances.      c. The duty to furnish information under paragraph b also    applies to each member to the extent the member knows any of    the information described in paragraph b .    2. In a manager-managed limited liability company, all of    the following rules apply:    a. The informational rights stated in subsection 1 and    the duty stated in subsection 1 , paragraph c , apply to the                         

  House File 655, p. 58   managers and not the members.    b. During regular business hours and at a reasonable    location specified by the limited liability   company, a    member may obtain from the company and   inspect and copy full    information regarding the activities, affairs, financial    condition, and other circumstances of the company as is just    and reasonable if all of the following apply:    (1) The member seeks the information for a purpose material      reasonably related   to the members interest as a member.    (2) The member makes a demand in a record received by    the limited liability   company, describing with reasonable    particularity the information sought and the purpose for    seeking the information.    (3) The information sought is directly connected to the    members purpose.    c. Within   Not later than ten days after receiving a demand    pursuant to paragraph b , subparagraph (2), the limited    liability company shall in a record inform in a record the    member that made the demand that includes   all of the following:    (1) Of the What information that the limited liability    company will provide in response to the demand and when and    where the company will provide the information.    (2) If the company declines to provide any demanded      information, the companys reasons for declining   The limited    liability companys reasons for declining, if the company    declines to provide any demanded information .    d. Whenever this chapter or an operating agreement provides    for a member to vote on or give or withhold consent to a matter,    before the vote is cast or   consent is given or withheld, the    limited liability company shall, without demand, provide the    member with all information that is known to the company and is    material to the members decision.    3. On ten days demand made in a record received by a      limited liability company, a dissociated member may have access    to information to which the person was entitled while a member      if the information pertains to the period during which the    person was a member, the person seeks the information in good      faith, and the person satisfies the requirements imposed on    a member by subsection 2 , paragraph b . The company shall                                        

  House File 655, p. 59   respond to a demand made pursuant to   this subsection in the    manner provided in subsection 2 , paragraph c Subject to    subsection 8, on ten days demand made in a record received by      a limited liability company, a person dissociated as a member      may have access to the information to which the person was    entitled while a member if all of the following apply:      a.   The information pertains to the period during which the    person was a member .    b.   The person seeks the information in good faith.    c. The person satisfies the requirements imposed on a member    by subsection 2, paragraph   b .    4. A limited liability company may charge a person that    makes a demand under this section the reasonable costs of    copying, limited to the costs of labor and material   shall    respond to a demand made pursuant to subsection 3 in the manner    provided in subsection 2, paragraph   c .    5. A member or dissociated member may exercise rights    under this section through an agent or, in the case of an    individual under legal disability, a legal representative. Any      restriction or condition imposed by the operating agreement    or under subsection 7 applies both to the agent or legal    representative and the member or dissociated member   A limited    liability company may charge a person that makes a demand under    this section the reasonable costs of copying, limited to the      costs of labor and material .    6. The rights under this section do not extend to a person    as transferee A member or person dissociated as a member may    exercise the rights under this section through an agent or,    in the case of an individual under legal disability, a legal      representative . Any restriction or condition imposed by the    operating agreement or under subsection 8 applies both to the      agent or legal representative and to the member or person    dissociated as a member.      7. In addition to any restriction or condition stated    in its operating agreement, a limited liability company, as      a matter within the ordinary course of its activities, may    impose reasonable restrictions and conditions on access to      and use of information to be furnished under this section ,    including designating information confidential and imposing                                                                       

  House File 655, p. 60   nondisclosure and safeguarding obligations on the recipient.      In a dispute concerning the reasonableness of a restriction    under   this subsection , the company has the burden of proving    reasonableness   Subject to section 489.504, the rights under    this section do not extend to a person as transferee .    8.   In addition to any restriction or condition stated in its    operating agreement, a limited liability company, as a matter      within the ordinary course of its activities and affairs, may    impose reasonable restrictions and conditions on access to      and use of information to be furnished under this section,    including designating information confidential and imposing      nondisclosure and safeguarding obligations on the recipient.    In a dispute concerning the reasonableness of a restriction    under this subsection, the company has the burden of proving      reasonableness.    Sec. 46. Section 489.502, Code 2023, is amended to read as    follows:    489.502 Transfer of transferable interest.    1. For   Subject to section 489.503, subsection 6, for a    transfer, in whole or in part, all of the following applies to    a transferable interest:    a. It is permissible.    b. It does not by itself cause a members   persons    dissociation as a member   or a dissolution and winding up of the    limited liability companys activities and affairs .    c. Subject to section 489.504 , it does not entitle the    transferee to do any of the following:    (1) Participate in the management or conduct of the limited    liability   companys activities and affairs .    (2) Except as otherwise provided in subsection 3 , have    access to records or other information concerning the limited      liability   companys activities and affairs .    2. A transferee has the right to receive, in accordance    with the transfer, distributions to which the transferor would    otherwise be entitled.      3. In a dissolution and winding up of a limited liability    company, a transferee is entitled to an account of the    companys transactions only from the date of dissolution.    4. A transferable interest may be evidenced by a certificate                                   

  House File 655, p. 61   of the interest issued by the   a limited liability company in a    record, and, subject to this section , the interest represented    by the certificate may be transferred by a transfer of the    certificate.    5. A limited liability company need not give effect to a    transferees rights under this section until the company knows      or   has notice of the transfer.    6. A transfer of a transferable interest in violation of a    restriction on transfer contained in the operating agreement    or another agreement to which the transferor is a party   is    ineffective as to a person having notice of the restriction at      the time of transfer if the intended transferee has knowledge    or notice of the restriction at the time of transfer .    7. Except as otherwise provided in section 489.602,    subsection 4   5 , paragraph b , when if a member transfers a    transferable interest, the transferor retains the rights of a    member other than the transferable   interest in distributions    transferred and retains all duties and obligations of a member.    8. When   If a member transfers a transferable interest to a    person that becomes a member with respect to the transferred    interest, the transferee is liable for the members obligations    under section   sections 489.403 and section 489.406, subsection    3 , 489.406 known to the transferee when the transferee becomes    a member.    Sec. 47. Section 489.503, Code 2023, is amended to read as    follows:    489.503 Charging order.    1. On application by a judgment creditor of a member    or transferee, a court may enter a charging order against    the transferable interest of the judgment debtor for the    unsatisfied amount of the judgment. A   Except as otherwise    provided in subsection 6, a charging order constitutes a lien    on a judgment debtors transferable interest and requires the    limited liability company to pay over to the person to which    the charging order was issued any distribution that would      otherwise would be paid to the judgment debtor.    2. To the extent necessary to effectuate the collection    of distributions pursuant to a charging order in effect under    subsection 1 , the court may do all of the following:                               

  House File 655, p. 62   a. Appoint a receiver of the distributions subject to    the charging order, with the power to make all inquiries the    judgment debtor might have made.    b. Make all other orders necessary to give effect to the    charging order.    3. Upon a showing that distributions under a charging    order will not pay the judgment debt within a reasonable    time, the court may foreclose the lien and order the sale of    the transferable interest. The   Except as otherwise provided    in subsection 6, the purchaser at the foreclosure sale only    obtains only   the transferable interest, does not thereby become    a member, and is subject to section 489.502 .    4. At any time before foreclosure under subsection 3 , the    member or transferee whose transferable interest is subject to    a charging order under subsection 1 may extinguish the charging    order by satisfying the judgment and filing a certified copy of    the satisfaction with the court that issued the charging order.    5. At any time before foreclosure under subsection 3 ,    a limited liability company or one or more members whose    transferable interests are not subject to the charging order    may pay to the judgment creditor the full amount due under the    judgment and thereby succeed to the rights of the judgment    creditor, including the charging order.    6. This chapter   does not deprive any member or transferee of    the benefit of any exemption laws applicable to the members    or transferees transferable interest If a court orders    foreclosure of a charging order lien against the sole member of    a limited liability company all of the following apply:    a.   The court shall confirm the sale .    b. The purchaser at the sale obtains the members entire    interest, not only the members transferable interest.      c.   The purchaser thereby becomes a member.    d.   The person whose interest was subject to the foreclosed    charging order is dissociated as a member.    7. This section   provides the exclusive remedy by which    a person seeking to enforce a judgment against a member or    transferee may, in the capacity of judgment creditor, satisfy      the judgment from the judgment debtors transferable interest    This chapter does not deprive any member or transferee of the                                   

  House File 655, p. 63   benefit of any exemption law applicable to the transferable      interest of the member or transferee .    8.   This section provides the exclusive remedy by which a    person seeking in the capacity of judgment creditor to enforce      a judgment against a member or transferee may satisfy the    judgment from the judgment debtors transferable interest.      Sec. 48. Section 489.504, Code 2023, is amended to read as    follows:    489.504 Power of personal representative of deceased member.    If a member dies, the deceased members personal   legal    representative or other legal representative   may exercise all    of the following:    1. The rights of a transferee provided in section 489.502,    subsection 3 , and, for   .    2. For the purposes of settling the estate, the rights of a    current   the deceased member had under section 489.410 .    Sec. 49. Section 489.601, Code 2023, is amended to read as    follows:    489.601 Members power   Power to dissociate as a member     wrongful dissociation.    1. A person has the power to dissociate as a member at any    time, rightfully or wrongfully, by withdrawing as a member by    express will under section 489.602, subsection 1 .    2. A persons dissociation from a limited liability company      as a member is wrongful only if any of the following applies to    the dissociation:    a. It is in breach of an express provision of the operating    agreement.    b. It occurs before the termination   completion of the    winding up of the limited liability company and any of the    following applies:    (1) The person withdraws as a member by express will.    (2) The person is expelled as a member by judicial order    under section 489.602, subsection 5   6 .      (3) The person is dissociated under section 489.602,    subsection 7, paragraph   a , by becoming a debtor in bankruptcy    8   .      (4) In the case of a person that is not a trust other than    a business trust, an estate, or an individual, the person                                            

  House File 655, p. 64   is expelled or otherwise dissociated as a member because it    willfully dissolved or terminated.    3. A person that wrongfully dissociates as a member is    liable to the limited liability company and, subject to    section 489.901 , to the other members for damages caused by the    dissociation. The liability is in addition to any other debt,    obligation, or other liability of the member to the company or    the other members.    Sec. 50. Section 489.602, Code 2023, is amended to read as    follows:    489.602 Events causing dissociation.    A person is dissociated as a member from a limited liability      company when any of the following applies:    1. The limited liability   company knows or has notice of    the persons express will to withdraw as a member, but, if the    person specified a withdrawal date later than the date the    limited liability   company knew or had notice, on that later    date.    2. An event stated in the operating agreement as causing the    persons dissociation occurs.    3. The person is expelled as a member pursuant to the      operating agreement   The persons entire interest is transferred    in a foreclosure sale under section 489.503, subsection 6 .    4. The person is expelled as a member by the unanimous      consent of the other members if any of the following applies:    pursuant to the operating agreement.    a. It is unlawful to carry on the companys activities with    the person as a member.    b.   There has been a transfer of all of the persons    transferable interest in the company, other than any of the    following:      (1) A transfer for security purposes.    (2)   A charging order in effect under section 489.503 which    has not been foreclosed.      c.   The person is a corporation and, within ninety days    after the company notifies the person that it will be expelled    as a member because the person has filed a certificate of      dissolution or the equivalent, its charter has been revoked,    or its right to conduct business has been suspended by                                          

  House File 655, p. 65   the jurisdiction of its incorporation, the certificate of      dissolution has not been revoked or its charter or right to    conduct business has not been reinstated.      d.   The person is a limited liability company or partnership    that has been dissolved and whose business is being wound up.    5. On application by the company, the person is expelled      as a member by judicial order because the person has done any      of the following The person is expelled as a member by the    affirmative vote or consent of all the other members if any of      the following apply :    a. Has engaged, or is engaging, in wrongful conduct that      has adversely and materially affected, or will adversely and    materially affect, the companys activities It is unlawful to    carry on the limited liability companys activities and affairs      with the person as a member .    b. Has willfully or persistently committed, or is willfully      and persistently committing, a material breach of the    operating agreement or the persons duties or obligations under    section 489.409   There has been a transfer of all the persons    transferable interest in the limited liability company, other    than any of the following:    (1)   A transfer for security purposes .    (2) A charging order in effect under section 489.503 which    has not been foreclosed.      c. Has engaged in, or is engaging in, conduct relating    to the companys activities which makes it not reasonably    practicable to carry on the activities with the person as a    member The person is an entity and all of the following apply:    (1)   The limited liability company notifies the person that    it will be expelled as a member because the person has filed    a statement of dissolution or the equivalent, the person has      been administratively dissolved, the persons charter or the      equivalent has been revoked, or the persons right to conduct      business has been suspended by the persons jurisdiction of      formation   .      (2)   Not later than ninety days after the notification,    the statement of dissolution or the equivalent has not been      withdrawn, rescinded, or revoked, the person has not been    reinstated, or the persons charter or the equivalent or right                                                        

  House File 655, p. 66   to conduct business has not been reinstated.      d. The person is an unincorporated entity that has been    dissolved and whose activities and affairs are being wound up.      6. In the case of a person who is an individual, any of      the following applies On application by the limited liability    company or a member in a direct action under section 489.901,      the person is expelled as a member by judicial order because      any of the following apply :    a. The person dies   has engaged or is engaging in wrongful    conduct that has affected adversely and materially, or will    affect adversely and materially, the companys activities and      affairs .    b. In a member-managed limited liability company, any of    the following applies:   The person has committed willfully or    persistently, or is committing willfully or persistently,    a material breach of the operating agreement or a duty or      obligation under section 489.409.    (1) A guardian or general conservator for the person is    appointed.      (2) There is a judicial order that the person has otherwise    become incapable of performing the persons duties as a member    under   this chapter or the operating agreement.    c. The person has engaged or is engaging in conduct relating    to the limited liability companys activities and affairs which      makes it not reasonably practicable to carry on the activities    and affairs with the person as a member.    7. In a member-managed limited liability company, the    person does any of the following In the case of an individual    any of the following apply   :    a. Becomes a debtor in bankruptcy The individual dies .    b. Executes an assignment for the benefit of creditors   In a    member-managed limited liability company any of the following    apply:      (1) A guardian or general conservator for the individual is    appointed   .    (2) A court orders that the individual has otherwise become    incapable of performing the individuals duties as a member      under this chapter or the operating agreement.    c. Seeks, consents to, or acquiesces in the appointment of                                                                

  House File 655, p. 67   a trustee, receiver, or liquidator of the person or of all or      substantially all of the persons property.    8. In the case of a person that is a trust or is acting as      a member by virtue of being a trustee of a trust, the trusts      entire transferable interest in the company is distributed In a    member-managed limited liability company, any of the following      apply:      a. The person becomes a debtor in bankruptcy .    b.   The person signs an assignment for the benefit of    creditors.    c.   The person seeks, consents to, or acquiesces in the    appointment of a trustee, receiver, or liquidator of the person    or of all or substantially all the persons property.    9. In the case of a person that is an estate or is acting      as a member by virtue of being a personal representative of    an estate, the estates entire transferable interest in the      company is distributed In the case of a person that is a    testamentary or inter vivos trust or is acting as a member by    virtue of being a trustee of such a trust, the trusts entire      transferable interest in the limited liability company is    distributed .    10. In the case of a member that is not an individual,      partnership, limited liability company, corporation, trust, or    estate, the termination of the member   In the case of a person    that is an estate or is acting as a member by virtue of being    a personal representative of an estate, the estates entire    transferable interest in the limited liability company is    distributed .    11. The company participates in a merger under   article 10 ,    if any of the following applies: In the case of a person that    is not an individual, the existence of the person terminates.      a. The company is not the surviving entity.    b.   Otherwise as a result of the merger, the person ceases    to be a member.      12. The company participates in a conversion under   article    10 The limited liability company participates in a merger under    subchapter X and any of the following apply:      a. The limited liability company is not the surviving    entity .                                                              

  House File 655, p. 68   b.   Otherwise as a result of the merger, the person ceases    to be a member.    13. The company participates in a domestication under      article 10   , if, as a result of the domestication, the    person ceases to be a member The limited liability company    participates in an interest exchange under subchapter X and,      as a result of the interest exchange, the person ceases to be a      member .    14. The limited liability   company terminates participates    in a conversion under subchapter X .    15.   The limited liability company participates in a    domestication under subchapter X and, as a result of the    domestication, the person ceases to be a member.    16.   The limited liability company dissolves and completes    winding up.    Sec. 51. Section 489.603, Code 2023, is amended to read as    follows:    489.603 Effect of persons   dissociation as member .    1. When   If a person is dissociated as a member , of a limited    liability company, all of the following apply:    a. The persons right to participate as a member in the    management and conduct of the limited liability   companys    activities and affairs terminates.    b. If the company is member-managed, the persons fiduciary      duties as a member end with regard to matters arising and    events occurring after the persons dissociation The persons    duties and obligations under section 489.409 as a member end    with regard to matters arising and events occurring after the    persons dissociation   .    c. Subject to section 489.504 and article 10 subchapter X ,    any transferable interest owned by the person in the persons      capacity as a member immediately before dissociation in the    persons capacity as a member   is owned by the person solely as    a transferee.      2. A persons dissociation as a member of a limited    liability company does not of itself discharge the person from    any debt, obligation, or other liability to the company or the    other members which the person incurred while a member.    Sec. 52. Section 489.604, Code 2023, is amended to read as                                                  

  House File 655, p. 69   follows:    489.604 Members power to dissociate under certain    circumstances.    1. If the certificate of organization or an operating    agreement does not specify the time or the events upon the    happening of which a member may dissociate from a limited    liability company   , a member may dissociate from the limited    liability company in the event any amendment to the certificate    of organization or operating agreement that is adopted over    the members written dissent adversely affects the rights or    preferences of the dissenting members transferable interest    in any of the ways described in paragraphs a through f .    A dissociation in the event of such dissent and adverse    effect is deemed to have occurred as of the effective date    of the amendment, if the member gives notice to the limited      liability   company not more than sixty days after the date of    the amendment. In valuing the members distribution pursuant    to this subsection , any depreciation in anticipation of the    amendment shall be excluded. An amendment that does any of the    following is subject to this section :    a. Alters or abolishes a members right to receive a    distribution.    b. Alters or abolishes a members right to voluntarily    dissociate.    c. Alters or abolishes a members right to vote on any    matter, except as the rights may be altered or abolished    through the acceptance of contributions or the making of    contribution agreements.    d. Alters or abolishes a members preemptive right to make    contributions.    e. Establishes or changes the conditions for or consequences    of expulsion.    f. Waives the application of this section to the limited    liability company.    2. A member dissociating from a limited liability company      under this section is not liable for damages for the breach of    any agreement not to withdraw.    3. This section applies to a limited liability company    whose original articles of organization or certificate of          

  House File 655, p. 70   organization is filed with the secretary of state on or after    July 1, 1997.    4. This section applies to a limited liability company whose    original articles of organization are filed with the secretary    of state and effective on or prior to June 30, 1997, if such    companys operating agreement provides that it is subject to    this section .    5. The operating agreement of a limited liability company    may waive the applicability of this section to the company and    its members.    Sec. 53. Section 489.701, Code 2023, is amended to read as    follows:    489.701 Events causing dissolution.    1. A limited liability company is dissolved, and its    activities and affairs   must be wound up, upon the occurrence    of any of the following:    a. An event or circumstance that the operating agreement    states causes dissolution.    b. The affirmative vote or   consent of all the members.    c. Once After the limited liability company has at least    one member, the passage of that member and any other member    dissociate, and   ninety consecutive days pass during which the    company has no members . , unless before the end of the period    all of the following apply:      (1) Consent to admit at least one specified person as a    member is given by transferees owning the rights to receive    a majority of distributions as transferees at the time the    consent is to be effective.    (2)   At least one person becomes a member in accordance with    the consent.      d. On application by a member, the entry by a   the district    court of an order dissolving the limited liability company on    the grounds that any of the following applies:    (1) The conduct of all or substantially all of   the limited    liability   companys activities and affairs is unlawful.    (2) It is not reasonably practicable to carry on the limited    liability   companys activities and affairs in conformity with    the certificate of organization and the operating agreement.    (3) The managers or those members in control of the limited                                      

  House File 655, p. 71   liability company conduct themselves according to any of the      following:    (a)   Have acted, are acting, or will act in a manner that is    illegal or fraudulent.      (b) Have acted or are acting in a manner that is oppressive    and was, is, or will be directly harmful to the applicant.      e. On application by a member or transferee, the entry by      a district court of an order dissolving the company on the    grounds that the managers or those members in control of the      company have done any of the following: The signing and filing    of a statement of administrative dissolution by the secretary      of state under section 489.705.    (1) Have acted, are acting, or will act in a manner that is    illegal or fraudulent.      (2) Have acted or are acting in a manner that is oppressive    and was, is, or will be directly harmful to the applicant.      2. In a proceeding brought under subsection 1 , paragraph    e , d , subparagraph (3), the district court may order a    remedy other than dissolution.    Sec. 54. Section 489.701A, Code 2023, is amended to read as    follows:    489.701A Rescinding dissolution.    1. A limited liability company may rescind its dissolution,    unless a statement of termination applicable to the company has    become effective, a   the district court has entered an order    under section 489.701, subsection 1 , paragraph d , dissolving    the company, or the secretary of state has dissolved the    company under section 489.705 .    2. Rescinding dissolution under this section requires all    of the following:    a. The affirmative vote or consent of each member.    b. If the limited liability company has delivered to the    secretary of state for filing a statement of dissolution and    any of the following applies   apply :    (1) If the statement has not become effective, delivery to    the secretary of state for filing of a statement of withdrawal    under section 489.205   489.208A applicable to the statement of    dissolution.      (2) If the statement of dissolution has become effective,                                       

  House File 655, p. 72   delivery to the secretary of state for filing of a statement of    rescission stating the name of the limited liability   company    and that dissolution has been rescinded under this section .    3. If a limited liability company rescinds its dissolution    all of the following apply:    a. The limited liability   company shall resume resumes    carrying on its activities and affairs as if the   dissolution    had never occurred.    b. Subject to paragraph c , any liability incurred by the    limited liability   company after the dissolution and before    the rescission has become effective shall be determined as if    dissolution had never occurred.    c. The rights of a third party arising out of conduct in    reliance on the dissolution before the third party knew or had    notice of the rescission must not be adversely affected.    Sec. 55. Section 489.702, Code 2023, is amended to read as    follows:    489.702 Winding up.    1. A dissolved limited liability company shall wind up its    activities and affairs   , and except as otherwise provided in    section 489.701A, the company continues after dissolution only    for the purpose of winding up.    2. In winding up its activities and affairs   , all of the    following apply to a limited liability company:    a. It shall discharge the limited liability   companys debts,    obligations, or and other liabilities, settle and close the    companys activities and affairs , and marshal and distribute    the assets of the company.    b. It may do all of the following:    (1) Deliver to the secretary of state for filing a statement    of dissolution stating the name of the limited liability      company and that the company is dissolved.    (2) Preserve the limited liability   company activities ,    affairs, and property as a going concern for a reasonable time.    (3) Prosecute and defend actions and proceedings, whether    civil, criminal, or administrative.      (4) Transfer the limited liability   companys property.    (5) Settle disputes by mediation or arbitration.    (6) Deliver to the secretary of state for filing a statement                      

  House File 655, p. 73   of termination stating the name of the limited liability      company and that the company is terminated.    (7) Perform other acts necessary or appropriate to the    winding up.    3. If a dissolved limited liability company has no members,    the legal representative of the last person to have been a    member may wind up the activities and affairs   of the company.    If the person does so, the person has the powers of a sole    manager under section 489.407, subsection 3 , and is deemed to    be a manager for the purposes of section 489.304, subsection    1 , paragraph   b .    4. If the legal representative under subsection 3 declines    or fails to wind up the limited liability companys activities    and affairs   , a person may be appointed to do so by the consent    of transferees owning a majority of the rights to receive    distributions as transferees at the time the consent is to be    effective. All of the following apply to a person appointed    under this subsection :    a. The person has the powers of a sole manager under section    489.407, subsection 3 , and is deemed to be a manager for the    purposes of section 489.304, subsection 1 , paragraph   b .    b. The person shall deliver   promptly deliver to the    secretary of state for filing an amendment to the limited    liability   companys certificate of organization to do stating    all of the following:    (1) State that That the limited liability company has no    members.    (2) State that the person has been appointed pursuant to    this subsection   to wind up the company The name and street and    mailing addresses of the person .    (3) Provide the street and mailing addresses of the person      That the person has been appointed pursuant to this subsection    to wind up the limited liability companys activities and      affairs .      5. The district court may order judicial supervision of the    winding up of a dissolved limited liability company, including    the appointment of a person to wind up the companys activities    and affairs   pursuant to any of the following:    a. On application of a member, if the applicant establishes                              

  House File 655, p. 74   good cause.    b. On the application of a transferee, if all of the    following apply:    (1) The limited liability   company does not have any members.    (2) The legal representative of the last person to have been    a member declines or fails to wind up the limited liability      companys activities and affairs   .    (3) Within a reasonable time following the dissolution a    person has not been appointed pursuant to subsection 4   3 .    c. In connection with a proceeding under section 489.701,    subsection 1 , paragraph d or   e .    Sec. 56. Section 489.703, Code 2023, is amended to read as    follows:    489.703 Known claims against dissolved limited liability    company.    1. Except as otherwise provided in subsection 4 , a dissolved    limited liability company may give notice of a known claim    under subsection 2 , which has the effect as   provided in    subsection 3 .    2. A dissolved limited liability company may in a record    notify its known claimants of the dissolution. The notice must    do all of the following:    a. Specify the information required to be included in a    claim.    b. Provide   State that a claim must be in writing and provide    a mailing address to which the claim is to be sent.    c. State the deadline for receipt of the a claim, which may    not be less than one hundred twenty days after the date the    notice is received by the claimant.    d. State that the claim will be barred if not received by    the deadline.    3. A claim against a dissolved limited liability company is    barred if the requirements of subsection 2 are met and any of    the following applies:    a. The claim is not received by the specified deadline.    b. If the claim is timely received but rejected by the    limited liability   company, all of the following must apply:    (1) The limited liability company causes the claimant to    receive a notice in a record stating that the claim is rejected                  

  House File 655, p. 75   and will be barred unless the claimant commences an action    against the company to enforce the claim within   not later than    ninety days after the claimant receives the notice.    (2) The claimant does not commence the required action    within not later than the ninety days after the claimant    receives the notice   .    4. This section does not apply to a claim based on an    event occurring after the effective   date of dissolution or a    liability that on that date is contingent.    Sec. 57. Section 489.704, Code 2023, is amended to read as    follows:    489.704 Other claims against dissolved limited liability    company.    1. A dissolved limited liability company may publish notice    of its dissolution and request persons having claims against    the company to present them in accordance with the notice.    2. The notice authorized by   under subsection 1 must do all    of the following meet all of the following requirements :    a. Be published at least once in a newspaper of general      circulation in the county in this state in which the dissolved    limited liability companys principal office is located or, if    it has none in this state, in the county in which the companys      registered office is or was last located Comply with any of the    following:      (1) Publication of the notice one time in a newspaper of    general circulation in the county in this state in which the    dissolved limited liability companys principal office is    located or, if the principal office is not located in this    state, in the county in which the office of the companys      registered agent is or was last located .    (2)   Publication by posting the notice conspicuously for at    least thirty days on the dissolved limited liability companys      internet site.      b. Describe the information required to be contained in a    claim , state that the claim must be in writing,   and provide a    mailing address to which the claim is to be sent.    c. State that a claim against the limited liability   company    is barred unless an action to enforce the claim is commenced      within five   not later than three years after publication of the                                       

  House File 655, p. 76   notice.    3. If a dissolved limited liability company publishes a    notice in accordance with subsection 2 , unless the claimant      commences an action to enforce   the claim against the company    within five years after the publication date of the notice, the    claim of each of the following claimants is barred   of each of    the following claimants is barred unless the claimant commences      an action to enforce the claim against the company not later    than three years after the publication date of the notice   :    a. A claimant that did not receive notice in a record under    section 489.703 .    b. A claimant whose claim was timely sent to the limited      liability company but not acted on.    c. A claimant whose claim is contingent at, or based on an    event occurring after, the effective   date of dissolution.    4. A claim not barred under this section or section 489.703      may be enforced as follows:    a. Against a dissolved limited liability company, to the    extent of its undistributed assets.    b. If   Except as otherwise provided in section 489.706A, if    assets of the limited liability company have been distributed    after dissolution, against a member or transferee to the extent    of that persons proportionate share of the claim or of the    companys   assets distributed to the member or transferee after    dissolution, whichever is less, but a persons total liability    for all claims under this paragraph does not exceed the total    amount of assets distributed to the person after dissolution.    Sec. 58. Section 489.705, Code 2023, is amended to read as    follows:    489.705 Administrative   Grounds for administrative    dissolution.    1.   The secretary of state may commence a proceeding under    this   section 489.709 to administratively dissolve a limited    liability company administratively, if any of the following    apply:    a.   1. The limited liability company has not delivered a    biennial report to the secretary of state in a form that meets      the requirements of section 489.209 within sixty days after    it is due, or has not paid within sixty days after the due                                   

  House File 655, p. 77   date, any fee, tax, or penalty due to the secretary of state      under this chapter or law other than this chapter The limited    liability company does not pay within sixty days after they are      due any fees, taxes, interest, or penalties imposed by this      chapter or other laws of this state .    b.   The limited liability company is without a registered    office or registered agent in this state for sixty days or      more.    c.   The limited liability company does not notify the    secretary of state within sixty days that its registered agent    or registered office has been changed, that its registered      agent has resigned, or that its registered office has been    discontinued.    d.   The limited liability companys period of duration stated    in its certificate of organization has expired.    2. If the secretary of state determines that a ground exists      for administratively dissolving a limited liability company,    the secretary of state shall file a record of the determination    and serve the company with a copy of the filed record   The    limited liability company does not deliver its biennial report    required by section 489.209 to the secretary of state within    sixty days after it is due   .    3. If within sixty days after service of the copy pursuant    to   subsection 2 a limited liability company does not correct    each ground for dissolution or demonstrate to the reasonable    satisfaction of the secretary of state that each ground    determined by the secretary of state does not exist, the    secretary of state shall dissolve the company administratively    by preparing, signing, and filing a declaration of dissolution      that states the grounds for dissolution. The secretary    of state shall serve the company with a copy of the filed      declaration The limited liability company is without a    registered agent or the registered agent does not have a place      of business in this state for sixty days or more .    4. A limited liability company that has been      administratively dissolved continues in existence but, subject    to   section 489.706 , may carry on only activities necessary to    wind up its activities and liquidate its assets under sections    489.702 and 489.708 and to notify claimants under sections                                                               

  House File 655, p. 78   489.703   and 489.704 The secretary of state has not been    notified within sixty days that the limited liability companys    registered agent or place of business of the registered agent      has been changed, or that its registered agent has resigned, or      that its registered office has been discontinued .    5. The administrative dissolution of a limited liability      company does not terminate the authority of its registered      agent for service of process The limited liability companys    period of duration stated in its certificate of organization      expires .    Sec. 59. Section 489.706, Code 2023, is amended to read as    follows:    489.706 Reinstatement following administrative dissolution.    1. A limited liability company administratively dissolved    under section 489.705 may apply to the secretary of state    for reinstatement at any time after the effective date    of dissolution. The application must be delivered to the      secretary of state and meet all of the following requirements:    a. Recite   State the name of the limited liability company    at its date of dissolution and the effective date of its    administrative dissolution.    b. State that the ground or grounds for dissolution as      provided in section 489.705 either did not exist or have been    eliminated.    c. If the application is received more than five years after    the effective date of the administrative   dissolution, state a    name that satisfies the requirements of section 489.108 .    d. State the federal tax identification number of the    limited liability company.    2. a.   The secretary of state shall refer the federal    tax identification number contained in the application for    reinstatement to the department of workforce development.    The department of workforce development shall report to the    secretary of state the tax status of the limited liability    company. If the department reports to the secretary of state    that a filing delinquency or liability exists against the    limited liability   company, the secretary of state shall not    cancel the declaration certificate of dissolution until the      filing delinquency or liability is satisfied.                              

  House File 655, p. 79   3.   b. (1) If the secretary of state determines that the    application contains the information required by subsection    1 , and that a delinquency or liability reported pursuant to    subsection 2 paragraph a has been satisfied, and that the    information is correct, the secretary of state shall cancel    the declaration   certificate of dissolution and prepare a    certificate of reinstatement that recites the secretary of    states determination and the effective date of reinstatement,    file the original of the   certificate of reinstatement , and    serve deliver a copy on to the limited liability company under    section 489.116 .    (2)   If the limited liability companys name in subsection    1 , paragraph c , is different than from the name in subsection    1 , paragraph a , the certificate of reinstatement shall    constitute an amendment to the limited liability   companys    certificate of organization insofar as it pertains to its    name. A limited liability   company shall not relinquish the    right to retain its name as provided in section 489.108 , if the    reinstatement is effective within five years of the effective    date of the limited liability   companys dissolution.    4. 3. When the reinstatement is effective, it relates    back to and takes effect as of the effective date of the    administrative dissolution as if the administrative dissolution    had never occurred.    Sec. 60. NEW SECTION   . 489.706A Court proceedings.    1. A dissolved limited liability company that has published    a notice under section 489.704 may file an application with    the district court in the county where the companys principal    office is located or, if the principal office is not located    in this state, where the office of its registered agent is    or was last located, for a determination of the amount and    form of security to be provided for payment of claims that are    reasonably expected to arise after the date of dissolution    based on facts known to the company and any of the following    apply:    a. At the time of application any of the following apply:    (1) The facts are contingent.    (2) The facts have not been made known to the limited    liability company.                              

  House File 655, p. 80   b. The facts are based on an event occurring after the date    of dissolution.    2. Security is not required for any claim that is or is    reasonably anticipated to be barred under section 489.704.    3. Not later than ten days after the filing of an    application under subsection 1, the dissolved limited liability    company shall give notice of the proceeding to each claimant    holding a contingent claim known to the company.    4. In a proceeding under this section, the court may appoint    a guardian ad litem to represent all claimants whose identities    are unknown. The reasonable fees and expenses of the guardian,    including all reasonable expert witness fees, must be paid by    the dissolved limited liability company.    5. A dissolved limited liability company that provides    security in the amount and form ordered by the court under    subsection 1 satisfies the companys obligations with respect    to claims that are contingent, have not been made known to    the company, or are based on an event occurring after the    date of dissolution, and such claims may not be enforced    against a member or transferee on account of assets received    in liquidation.    Sec. 61. Section 489.707, Code 2023, is amended to read as    follows:    489.707 Appeal from rejection   denial of reinstatement.    1. If the secretary of state rejects denies a limited    liability companys application for reinstatement following    administrative dissolution, the secretary of state shall    prepare, sign, and file a notice that explains the reason for    rejection and   serve the company under section 489.116 with a    copy of the written notice that explains the reason or reasons    for denial   .    2. Within thirty days after service of a notice of rejection    of reinstatement under   subsection 1 , a limited liability    company may appeal from the rejection by petitioning the    district court to set aside the dissolution. The petition      must be served on the secretary of state and contain a copy    of the secretary of states declaration of dissolution, the      companys application for reinstatement, and the secretary      of states notice of rejection   The limited liability company                         

  House File 655, p. 81   may appeal the denial of reinstatement to the district court      of the county where the companys principal office or, if none    in this state, where its registered office is located within      thirty days after service of the notice of denial is effected   .    The company appeals by petitioning the court to set aside    the dissolution and attaching to the petition copies of the      secretary of states certificate of dissolution, the companys      application for reinstatement, and the secretary of states    notice of denial.      3. The court may summarily order the secretary of state to    reinstate a   the dissolved limited liability company or may take    other action the court considers appropriate.    4. The courts final decision may be appealed as in other    civil proceedings.      Sec. 62. Section 489.708, Code 2023, is amended to read as    follows:    489.708 Distribution   Disposition of assets in winding up    limited liability companys activities .    1. In winding up its activities and affairs   , a limited    liability company must shall apply its assets to discharge its    the companys obligations to creditors, including members that    are creditors.    2. After a limited liability company complies with    subsection 1 , any surplus must be distributed in the following    order, subject to any charging order in effect under section    489.503 :    a. To each person owning a transferable interest that    reflects contributions made by a member and not previously      returned, an amount equal to the value of the unreturned      contributions and not previously returned, an amount equal to    the value of the unreturned contributions   .    b. In equal shares among members and dissociated members,    except to the extent necessary to comply with any transfer      effective under section 489.502 Among persons owning    transferable interests in proportion to their respective rights      to share in distributions immediately before the dissolution of    the limited liability company   .    3. If a limited liability company does not have sufficient    surplus to comply with subsection 2 , paragraph a , any surplus                                         

  House File 655, p. 82   must be distributed among the owners of transferable interests    in proportion to the value of their   the respective unreturned    contributions.    4. All distributions made under subsections 2 and 3 must be    paid in money.    Sec. 63. NEW SECTION   . 489.709 Procedure for and effect of    administrative dissolution.    1. If the secretary of state determines that one or more    grounds exist under section 489.705 for dissolving a limited    liability company, the secretary of state shall serve the    company with written notice of such determination under section    489.116.    2. If the limited liability company does not correct    each ground for dissolution or demonstrate to the reasonable    satisfaction of the secretary of state that each ground    determined by the secretary of state does not exist within    sixty days after service of the notice under section 489.116,    the secretary of state shall administratively dissolve the    company by signing a certificate of dissolution that recites    the ground or grounds for dissolution and its effective    date. The secretary of state shall file the original of the    certificate and serve a copy on the company under section    489.116.    3. A limited liability company administratively dissolved    continues its existence but shall not carry on any business    except that necessary to wind up and liquidate its business    and affairs under section 489.702 and notify claimants under    sections 489.703 and 489.704.    4. The administrative dissolution of a limited liability    company does not terminate the authority of its registered    agent.    Sec. 64. Section 489.801, Code 2023, is amended to read as    follows:      489.801 Governing law.    1. Subject to sections   489.14402 and 489.14404 , the law    of the state or other jurisdiction under which The law of    the jurisdiction of formation of   a foreign limited liability    company is formed governs all of the following:    a. The internal affairs of the foreign limited liability                

  House File 655, p. 83   company.    b. The liability of a member as member and a   manager as    manager for the debts, obligations, or other liabilities   a    debt, obligation, or other liability   of the foreign limited    liability company.    c.   The liability of a series of the foreign limited    liability company.      2. A foreign limited liability company shall not be denied    a certificate of authority by reason of any difference between      the law of the jurisdiction under which the company is formed    is not precluded from registering to do business in this state      because of any difference between the law of the foreign    limited liability companys jurisdiction of formation and the    law of this state.    3. A certificate of authority does not authorize a      foreign limited liability company to engage in any business      or exercise any power that a limited liability company shall    not Registration of a foreign limited liability company to do    business in this state does not permit the foreign limited      liability company to engage in any business or affairs or    exercise any power that a limited liability company cannot    lawfully   engage in or exercise in this state.    Sec. 65. NEW SECTION . 489.805A Special litigation    committee.    1. If a limited liability company is named as or made a    party in a derivative proceeding, the company may appoint a    special litigation committee to investigate the claims asserted    in the proceeding and determine whether pursuing the action is    in the best interests of the company. If the company appoints    a special litigation committee, on motion by the committee made    in the name of the company, except for good cause shown, the    court shall stay discovery for the time reasonably necessary    to permit the committee to make its investigation. This    subsection does not prevent the court from doing any of the    following:    a. Enforcing a persons right to information under section    489.410.      b. Granting extraordinary relief in the form of a temporary    restraining order or preliminary injunction.                             

  House File 655, p. 84   2. A special litigation committee must be composed of one    or more disinterested and independent individuals, who may be    members.    3. A special litigation committee may be appointed as    follows:    a. In a member-managed limited liability company, any of the    following:    (1) By the affirmative vote or consent of a majority of the    members not named as parties in the proceeding.    (2) If all members are named as parties in the proceeding,    by a majority of the members named as defendants.    b. In a manager-managed limited liability company, any of    the following:    (1) By a majority of the managers not named as parties in    the proceeding.    (2) If all managers are named as parties in the proceeding,    by a majority of the managers named as defendants.    4. After appropriate investigation, a special litigation    committee may determine that it is in the best interests of the    limited liability company that the proceeding comply with any    of the following:    a. Continue under the control of the plaintiff.    b. Continue under the control of the committee.    c. Be settled on terms approved by the committee.    d. Be dismissed.    5. After making a determination under subsection 4, a    special litigation committee shall file with the court a    statement of its determination and its report supporting its    determination and shall serve each party with a copy of the    determination and report. The court shall determine whether    the members of the committee were disinterested and independent    and whether the committee conducted its investigation and made    its recommendation in good faith, independently, and with    reasonable care, with the committee having the burden of proof.    If the court finds that the members of the committee were    disinterested and independent and that the committee acted in    good faith, independently, and with reasonable care, the court    shall enforce the determination of the committee. Otherwise,      the court shall dissolve the stay of discovery entered under   

  House File 655, p. 85   subsection 1 and allow the action to continue under the control    of the plaintiff.    Sec. 66. Section 489.809, Code 2023, is amended to read as    follows:    489.809 Action by attorney general.    The attorney general may maintain an action to enjoin a    foreign limited liability company from transacting   doing    business in this state in violation of this article chapter .    Sec. 67. Section 489.902, Code 2023, is amended to read as    follows:    489.902 Derivative action.    A member may maintain a derivative action to enforce a right      of a limited liability company as follows:    1.   The A member may maintain a derivative action to enforce    a right of a limited liability company, if the member first    makes a demand on the other members in a member-managed limited    liability company, or the managers of a manager-managed limited    liability company, requesting that they cause the company to    bring an action to enforce the right, and the managers or other    members do not bring the action within ninety days from the    date the demand was made unless the member has earlier been    notified that the demand has been rejected by the company    or unless irreparable injury to the company would result by    waiting for the expiration of the ninety-day period.    2.   A demand under subsection 1 would be futile.    Sec. 68. Section 489.904, Code 2023, is amended to read as    follows:    489.904 Pleading.    In a derivative action under section 489.902 , the complaint    must state with particularity any of the following:    1. The date and content of the plaintiffs demand and the    response to the demand by the managers or other members.    2. If a demand has not been made, the reasons a demand under      section 489.902, subsection 1 , would be Why demand should be    excused as   futile.    Sec. 69. NEW SECTION . 489.905 Activities not constituting    doing business in this state.    1. Activities of a foreign limited liability company that    do not constitute doing business in this state for purposes of                        

  House File 655, p. 86   this subchapter include all of the following:    a. Maintaining, defending, mediating, arbitrating, or    settling a proceeding.    b. Carrying on any activity concerning the internal affairs    of the foreign limited liability company, including holding    meetings of its members or managers.    c. Maintaining accounts in financial institutions.    d. Maintaining offices or agencies for the transfer,    exchange, and registration of securities of the foreign limited    liability company or maintaining trustees or depositories with    respect to those securities.    e. Selling through independent contractors.    f. Soliciting or obtaining orders by any means if the    orders require acceptance outside this state before they become    contracts.    g. Creating or acquiring indebtedness, mortgages, or    security interests in property.    h. Securing or collecting debts or enforcing mortgages or    other security interests in property securing the debts and    holding, protecting, or maintaining property so acquired.    i. Conducting an isolated transaction that is not in the    course of similar transactions.    j. Owning, protecting, and maintaining property.    k. Doing business in interstate commerce.    2. This section does not apply in determining the contacts    or activities that may subject a foreign limited liability    company to service of process, taxation, or regulation under    the laws of this state other than this chapter.    Sec. 70. Section 489.906, Code 2023, is amended to read as    follows:    489.906 Proceeds and expenses.    1. Except as otherwise provided in subsection 2 , all of the    following apply:    a. Any proceeds or other benefits of a derivative action    under   section 489.902 , whether by judgment, compromise, or    settlement, belong to the limited liability company and not to    the plaintiff.    b. If the plaintiff receives any proceeds, the plaintiff    shall remit them immediately to the limited liability   company.      

  House File 655, p. 87   2. If a derivative action under   section 489.902 is    successful in whole or in part, the court may award the    plaintiff reasonable expenses, including reasonable attorney    fees and costs, from the recovery of the limited liability    company.    3.   A derivative action on behalf of a limited liability    company shall not be voluntarily dismissed or settled without      the courts approval.    Sec. 71. NEW SECTION   . 489.906A Noncomplying name of foreign    limited liability company.    1. A foreign limited liability company whose name does    not comply with section 489.108 shall not register to do    business in this state until it adopts, for the purpose of    doing business in this state, an alternate name that complies    with section 489.108 by filing a foreign registration statement    under section 489.911B, or if applicable, a transfer of    registration statement under section 489.910, setting forth    that alternate name. After registering to do business in this    state with an alternate name, a foreign limited liability    company shall do business in this state under any of the    following:    a. The alternate name.    b. The foreign limited liability companys name, with the    addition of its jurisdiction of formation.    2. If a registered foreign limited liability company    changes its name after registration to a name that does not    comply with section 489.108, it shall not do business in this    state until it complies with subsection 1 by amending its    registration statement to adopt an alternate name that complies    with section 489.108.    Sec. 72. NEW SECTION   . 489.907 Withdrawal of registration of    registered foreign limited liability company.    1. A registered foreign limited liability company may    withdraw its registration by delivering a statement of    withdrawal to the secretary of state for filing. The statement    of withdrawal must be signed by the foreign limited liability    company and state all of the following:    a. The name of the foreign limited liability company and its    jurisdiction of formation.            

  House File 655, p. 88   b. That the foreign limited liability company is not doing    business in this state and that it withdraws its registration    to do business in this state.    c. That the foreign limited liability company revokes the    authority of its registered agent in this state.    d. An address to which process on the foreign limited    liability company may be sent by the secretary of state under    section 489.116, subsection 3.    2. After the withdrawal of the registration of a foreign    limited liability company, service of process in any proceeding    based on a cause of action arising during the time the entity    was registered to do business in this state may be made as    provided in section 489.116.    Sec. 73. NEW SECTION   . 489.908 Deemed withdrawal upon    domestication or conversion to certain domestic entities.    A registered foreign limited liability company that    domesticates to a domestic limited liability company or    converts to a domestic business corporation or domestic    nonprofit corporation or any type of domestic filing entity or    to a domestic limited liability partnership is deemed to have    withdrawn its registration on the effectiveness of such event.    Sec. 74. NEW SECTION   . 489.909 Withdrawal upon dissolution    or conversion to certain nonfiling entities.    1. A registered foreign limited liability company that    has dissolved and completed winding up or has converted to    a domestic or foreign nonfiling entity other than a limited    liability partnership shall deliver to the secretary of state    for filing a statement of withdrawal. The statement must be    signed by the dissolved foreign limited liability company or    the converted domestic or foreign nonfiling entity and state:    a. In the case of a foreign limited liability company that    has completed winding up all of the following:    (1) Its name and jurisdiction of formation.    (2) That the foreign limited liability company withdraws    its registration to do business in this state and revokes the    authority of its registered agent to accept service on its    behalf.    (3) An address to which process on the foreign limited    liability company may be sent by the secretary of state under     

  House File 655, p. 89   section 489.116, subsection 3.    b. In the case of a foreign limited liability company that    has converted to a domestic or foreign nonfiling entity other    than a limited liability partnership, all of the following:    (1) The name of the converting foreign limited liability    company and its jurisdiction of formation.    (2) The type of the nonfiling entity to which it has    converted and its name and jurisdiction of formation.    (3) That it withdraws its registration to do business in    this state and revokes the authority of its registered agent to    accept service on its behalf.    (4) An address to which process on the foreign limited    liability company may be sent by the secretary of state under    section 489.116, subsection 3.    2. After the withdrawal of the registration of a foreign    limited liability company, service of process in any proceeding    based on a cause of action arising during the time the entity    was registered to do business in this state may be made as    provided in section 489.116.    Sec. 75. NEW SECTION   . 489.910 Transfer of registration.    1. If a registered foreign limited liability company merges    into a nonregistered foreign entity or converts to a foreign    entity required to register with the secretary of state to do    business in this state, the foreign entity shall deliver to    the secretary of state for filing a transfer of registration    statement. The transfer of registration statement must be    signed by the surviving or converted foreign entity and state    all of the following:    a. The name of the registered foreign limited liability    company and its jurisdiction of formation before the merger or    conversion.    b. The name and type of the surviving or converted foreign    entity and its jurisdiction of formation after the merger    or conversion and, if the name does not comply with section    489.108, an alternate name adopted pursuant to section    489.906A.      c. All of the following information regarding the surviving    or converted foreign entity after the merger or conversion:    (1) The street and mailing addresses of the principal office    

  House File 655, p. 90   of the foreign entity and, if the law of the foreign entitys    jurisdiction of formation requires it to maintain an office in    that jurisdiction, the street and mailing addresses of that    office.    (2) The street and mailing addresses of the place of    business of the foreign entitys registered agent in this state    and the name of its registered agent.    2. On the effective date of a transfer of registration    statement as determined in accordance with section 489.207,    the registration of the registered foreign limited liability    company to do business in this state is transferred without    interruption to the foreign entity into which it has merged or    to which it has been converted.    Sec. 76. NEW SECTION   . 489.911 Administrative termination of    registration.    1. The secretary of state may terminate the registration of    a registered foreign limited liability company in the manner    provided in subsections 2 and 3, if any of the following    applies:    a. The foreign limited liability company does not pay within    sixty days after they are due any fees, taxes, interest, or    penalties imposed by this chapter or other laws of this state.    b. The foreign limited liability company does not deliver    its biennial report to the secretary of state within sixty days    after it is due.    c. The foreign limited liability company is without a    registered agent or its registered agent has no place of    business in this state for sixty days or more.    d. The secretary of state has not been notified within sixty    days that the foreign limited liability companys registered    agent or the registered agents place of business has been    changed, that its registered agent has resigned, or that its    registered office has been discontinued.    2. The secretary of state may terminate the registration of    a registered foreign limited liability company by doing all of    the following:    a. Filing a certificate of termination.    b. Delivering a copy of the certificate of termination    to the foreign companys registered agent or, if the foreign    

  House File 655, p. 91   company does not have a registered agent, to the foreign    companys principal office.    3. The certificate of termination must state all of the    following:    a. The effective date of the termination, which must be    not less than sixty days after the secretary of state delivers    the copy of the certificate of termination as prescribed in    subsection 2, paragraph b .    b. The grounds for termination under subsection 1.    4. The registration of a registered foreign limited    liability company to do business in this state ceases on    the effective date of the termination as set forth in the    certificate of termination, unless before that date the    foreign company cures each ground for termination stated in the    certificate of termination. If the foreign company cures each    ground, the secretary of state shall file a statement that the    certificate of termination is withdrawn.    5. After the effective date of the termination as set forth    in the certificate of termination, service of process in any    proceeding based on a cause of action arising during the time    the entity was registered to do business in this state may be    made as provided in section 489.116.    Sec. 77. NEW SECTION   . 489.911A Registration to do business    in this state.    1. A foreign limited liability company shall not do business    in this state until it registers with the secretary of state    under this chapter.    2. A foreign limited liability company doing business in    this state shall not maintain a proceeding in any court of this    state until it is registered to do business in this state.    3. The failure of a foreign limited liability company    to register to do business in this state does not impair    the validity of a contract or act of the foreign company or    preclude it from defending a proceeding in this state.    4. A limitation on the liability of a member or manager    of a foreign limited liability company is not waived solely    because the foreign company does business in this state without    registering.    5. Section 489.801, subsection 1, applies even if a    

  House File 655, p. 92   foreign limited liability company fails to register under this    subchapter.    Sec. 78. NEW SECTION   . 489.911B Foreign registration    statement.    1. To register to do business in this state, a foreign    limited liability company shall deliver a foreign registration    statement to the secretary of state for filing. The    registration statement must be signed by the foreign company    and state all of the following:    a. The name of the foreign limited liability company and,    if the name does not comply with section 489.108, an alternate    name as required by section 489.906A.    b. The foreign limited liability companys jurisdiction of    formation.    c. The street and mailing addresses of the foreign limited    liability companys principal office and, if the law of the    foreign companys jurisdiction of formation requires the    foreign company to maintain an office in that jurisdiction, the    street and mailing addresses of that required office.    d. The street and mailing addresses of the place of business    of the foreign limited liability companys registered agent in    this state and the name of its registered agent.    2. The foreign limited liability company shall deliver the    completed foreign registration statement to the secretary of    state, and also deliver to the secretary of state a certificate    of existence or a document of similar import duly authenticated    by the secretary of state or other official having custody of    corporate records in the state or country under whose law it is    incorporated which is dated no earlier than ninety days prior    to the date the application is filed by the secretary of state.    Sec. 79. NEW SECTION   . 489.911C Amendment of foreign    registration statement.    A registered foreign limited liability company shall sign    and deliver to the secretary of state for filing an amendment    to its foreign registration statement if there is a change in    any of the following:    1. Its name or alternate name.    2. Its jurisdiction of formation, unless its registration    is deemed to have been withdrawn under section 489.908 or     

  House File 655, p. 93   transferred under section 489.910.    3. An address required by section 489.911B, subsection 1,    paragraph c .    4. The information required by section 489.911B, subsection    1, paragraph d .    Sec. 80. Section 489.1001, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1001 Definitions.    As used in this subchapter, unless the context otherwise    requires:    1. Acquired entity means the entity, all of one or more    classes or series of interests of which are acquired in an    interest exchange.    2. Acquiring entity means the entity that acquires all    of one or more classes or series of interests of the acquired    entity in an interest exchange.    3. Conversion means a transaction authorized by part 4.    4. Converted entity means the converting entity as it    continues in existence after a conversion.    5. Converting entity means the domestic entity that    approves a plan of conversion pursuant to section 489.1043 or    the foreign entity that approves a conversion pursuant to the    law of its jurisdiction of formation.    6. Distributional interest means the right under an    unincorporated entitys organic law and organic rules to    receive distributions from the entity.    7. Domestic , with respect to an entity, means governed as    to its internal affairs by the law of this state.    8. Domesticated limited liability company means the    domesticating limited liability company as it continues in    existence after a domestication.    9. Domesticating limited liability company means the    domestic limited liability company that approves a plan of    domestication pursuant to section 489.1053 or the foreign    limited liability company that approves a domestication    pursuant to the law of its jurisdiction of formation.    10. Domestication means a transaction authorized by part    5.      11. a. Entity means any of the following:   

  House File 655, p. 94   (1) A business corporation.    (2) A nonprofit corporation.    (3) A general partnership, including a limited liability    partnership.    (4) A limited partnership, including a limited liability    limited partnership.    (5) A limited liability company.    (6) A domestic cooperative.    (7) An unincorporated nonprofit association.    (8) A statutory trust, business trust, or common-law    business trust.    (9) Any other person that has any of the following:    (a) A legal existence separate from any interest holder of    that person.    (b) The power to acquire an interest in real property in    its own name.    b. Entity does not include any of the following:    (1) An individual.    (2) A trust with a predominantly donative purpose or a    charitable trust.    (3) An association or relationship that is not an entity    listed in paragraph a and is not a partnership under the    rules stated in section 486A.202, subsection 3, or a similar    provision of the law of another jurisdiction.    (4) A decedents estate.    (5) A government or a governmental subdivision, agency, or    instrumentality.    12. Filing entity means an entity whose formation requires    the filing of a public organic record. The term does not    include a limited liability partnership.    13. Foreign , with respect to an entity, means an    entity governed as to its internal affairs by the law of a    jurisdiction other than this state.    14. Governance interest means a right under the organic    law or organic rules of an unincorporated entity, other than as    a governor, agent, assignee, or proxy, to any of the following:    a. Receive or demand access to information concerning, or    the books and records of, the entity.    b. Vote for or consent to the election of the governors of   

  House File 655, p. 95   the entity.    c. Receive notice of or vote on or consent to an issue    involving the internal affairs of the entity.    15. Governor means any of the following:    a. A director of a business corporation.    b. A director or trustee of a nonprofit corporation.    c. A general partner of a general partnership.    d. A general partner of a limited partnership.    e. A manager of a manager-managed limited liability company.    f. A member of a member-managed limited liability company.    g. A director of a domestic cooperative.    h. A manager of an unincorporated nonprofit association.    i. A trustee of a statutory trust, business trust, or    common-law business trust.    j. Any other person under whose authority the powers of an    entity are exercised and under whose direction the activities    and affairs of the entity are managed pursuant to the organic    law and organic rules of the entity.    16. Interest means any of the following:    a. A share in a business corporation.    b. A membership in a nonprofit corporation.    c. A partnership interest in a general partnership.    d. A partnership interest in a limited partnership.    e. A membership interest in a limited liability company.    f. A share in a domestic cooperative.    g. A membership in an unincorporated nonprofit association.    h. A beneficial interest in a statutory trust, business    trust, or common-law business trust.    i. A governance interest or distributional interest in any    other type of unincorporated entity.    17. Interest exchange means a transaction authorized by    part 3.    18. Interest holder means any of the following:    a. A shareholder of a business corporation.    b. A member of a nonprofit corporation.    c. A general partner of a general partnership.    d. A general partner of a limited partnership.    e. A limited partner of a limited partnership.    f. A member of a limited liability company.   

  House File 655, p. 96   g. A shareholder of a domestic cooperative.    h. A member of an unincorporated nonprofit association.    i. A beneficiary or beneficial owner of a statutory trust,    business trust, or common-law business trust.    j. Any other direct holder of an interest.    19. Interest holder liability means any of the following:    a. Personal liability for a liability of an entity which is    imposed on a person due to any of the following:    (1) Solely by reason of the status of the person as an    interest holder.    (2) By the organic rules of the entity which make one or    more specified interest holders or categories of interest    holders liable in their capacity as interest holders for all or    specified liabilities of the entity.    b. An obligation of an interest holder under the organic    rules of an entity to contribute to the entity.    20. Merger means a transaction authorized by part 2.    21. Merging entity means an entity that is a party to    a merger and exists immediately before the merger becomes    effective.    22. Organic law means the law of an entitys jurisdiction    of formation governing the internal affairs of the entity.    23. Organic rules means the public organic record and    private organic rules of an entity.    24. Plan means a plan of merger, plan of interest    exchange, plan of conversion, or plan of domestication.    25. Plan of conversion means a plan under section    489.1042.    26. Plan of domestication means a plan under section    489.1052.    27. Plan of interest exchange means a plan under section    489.1032.      28. Plan of merger means a plan under section 489.1022.    29. a. Private organic rules means the rules, whether or    not in a record, that govern the internal affairs of an entity,    are binding on all its interest holders, and are not part of    its public organic record, if any.    b. Private organic rules includes all of the following:    (1) The bylaws of a business corporation.   

  House File 655, p. 97   (2) The bylaws of a nonprofit corporation.    (3) The partnership agreement of a general partnership.    (4) The partnership agreement of a limited partnership.    (5) The operating agreement of a limited liability company.    (6) The bylaws of a domestic cooperative.    (7) The governing principles of an unincorporated nonprofit    association.    (8) The trust instrument of a statutory trust or similar    rules of a business trust or common-law business trust.    30. Protected agreement means any of the following:    a. A record evidencing indebtedness and any related    agreement in effect on January 1, 2009.    b. An agreement that is binding on an entity on January 1,    2009.    c. The organic rules of an entity in effect on January 1,    2009.    d. An agreement that is binding on any of the governors or    interest holders of an entity on January 1, 2009.    31. a. Public organic record means the record the filing    of which by the secretary of state is required to form an    entity and any amendment to or restatement of that record.    b. Public organic record includes any of the following:    (1) The articles of incorporation of a business    corporation.    (2) The articles of incorporation of a nonprofit    corporation.    (3) The certificate of limited partnership of a limited    partnership.    (4) The certificate of organization of a limited liability    company.    (5) The articles of incorporation of a domestic    cooperative.    (6) The certificate of trust of a statutory trust or similar    record of a business trust.      32. Registered foreign entity means a foreign entity that    is registered to do business in this state pursuant to a record    filed by the secretary of state.    33. Statement of conversion means a statement under    section 489.1045.     

  House File 655, p. 98   34. Statement of domestication means a statement under    section 489.1055.    35. Statement of interest exchange means a statement under    section 489.1035.    36. Statement of merger means a statement under section    489.1025.    37. Surviving entity means the entity that continues in    existence after or is created by a merger.    38. Type of entity means a generic form of entity that is    any of the following:    a. Recognized at common law.    b. Formed under an organic law, whether or not some entities    formed under that organic law are subject to provisions of that    law that create different categories of the form of entity.    Sec. 81. Section 489.1002, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1002 Relationship of subchapter to other laws.    1. This subchapter does not authorize an act prohibited by,    and does not affect the application or requirements of, law    other than this subchapter.    2. A transaction effected under this subchapter shall    not create or impair a right, duty, or obligation of a    person under the statutory law of this state other than this    subchapter relating to a change in control, takeover, business    combination, control-share acquisition, or similar transaction    involving a domestic merging, acquired, converting, or    domesticating business corporation unless any of the following    applies:    a. If the corporation does not survive the transaction, the    transaction satisfies any requirements of the law.    b. If the corporation survives the transaction, the approval    of the plan is by a vote of the shareholders or directors which    would be sufficient to create or impair the right, duty, or    obligation directly under the law.    Sec. 82. Section 489.1003, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1003 Required notice or approval.    1. A domestic or foreign entity that is required to give    notice to, or obtain the approval of, a governmental agency   

  House File 655, p. 99   or officer of this state to be a party to a merger must give    the notice or obtain the approval to be a party to an interest    exchange, conversion, or domestication.    2. Property held for a charitable purpose under the law of    this state by a domestic or foreign entity immediately before    a transaction under this subchapter becomes effective may be    diverted from the objects for which it was donated, granted,    devised, or otherwise transferred only to the extent a public    benefit corporation is able to divert from such objects under    chapter 504.    3. A bequest, devise, gift, grant, or promise contained    in a will or other instrument of donation, subscription, or    conveyance which is made to a merging entity that is not the    surviving entity and which takes effect or remains payable    after the merger inures to the surviving entity.    4. A trust obligation that would govern property if    transferred to a nonsurviving entity applies to property that    is transferred to the surviving entity under this section.    Sec. 83. Section 489.1004, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1004 Nonexclusivity.    The fact that a transaction under this subchapter produces    a certain result does not preclude the same result from being    accomplished in any other manner permitted by law other than    this subchapter.    Sec. 84. Section 489.1005, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1005 Reference to external facts.    1. A plan may refer to facts ascertainable outside the plan    if the manner in which the facts will operate upon the plan is    specified in the plan. The facts may include the occurrence of    an event or a determination or action by a person, whether or    not the event, determination, or action is within the control      of a party to the transaction.    2. The following provisions of a record delivered to the    secretary of state for filing under this chapter or a plan    delivered for filing in lieu of a statement shall not be made    dependent on facts outside the record or plan:    a. The name and address of any person.   

  House File 655, p. 100   b. The registered office of any entity.    c. The registered agent of any entity.    d. The number of authorized interests and designation of    each class or series of interests.    e. The effective date of a record delivered to the secretary    of state for filing.    f. Any required statement in a record delivered to the    secretary of state for filing of the date on which the    underlying transaction was approved or the manner in which that    approval was given.    Sec. 85. Section 489.1006, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1006 Appraisal rights.    An interest holder of a domestic merging, acquired,    converting, or domesticating limited liability company is    entitled to contractual appraisal rights in connection with a    transaction under this subchapter to the extent provided in any    of the following:    1. The operating agreement.    2. The plan.    Sec. 86. Section 489.1007, Code 2023, is amended by striking    the section and inserting in lieu thereof the following:    489.1007 Excluded entities and transactions.    This subchapter shall not be used to effect a transaction    involving a bank, insurance company, or public utility where    any chapter governing the regulation of such entity does not    permit the transaction.    Sec. 87. NEW SECTION   . 489.1021 Merger authorized.    1. By complying with this part, all of the following apply:    a. One or more domestic limited liability companies may    merge with one or more domestic or foreign entities into a    domestic or foreign surviving entity.    b. Two or more foreign entities may merge into a domestic    limited liability company.    2. By complying with the provisions of this part applicable    to foreign entities, a foreign entity may be a party to a    merger under this part or may be the surviving entity in such    a merger if the merger is authorized by the law of the foreign    entitys jurisdiction of formation.    

  House File 655, p. 101   Sec. 88. NEW SECTION   . 489.1022 Plan of merger.    1. A domestic limited liability company may become a party    to a merger under this part by approving a plan of merger. The    plan must be in a record and contain all of the following:    a. As to each merging entity, its name, jurisdiction of    formation, and type of entity.    b. If the surviving entity is to be created in the merger, a    statement to that effect and the entitys name, jurisdiction of    formation, and type of entity.    c. The manner of converting the interests in each party    to the merger into interests, securities, obligations, money,    other property, rights to acquire interests or securities, or    any combination of the foregoing.    d. If the surviving entity exists before the merger, any    proposed amendments to all of the following:    (1) Its public organic record, if any.    (2) Its private organic rules that are, or are proposed to    be, in a record.    e. If the surviving entity is to be created in the merger,    all of the following:    (1) Its proposed public organic record, if any.    (2) The full text of its private organic rules that are    proposed to be in a record.    f. The other terms and conditions of the merger.    g. Any other provision required by the law of a merging    entitys jurisdiction of formation or the organic rules of a    merging entity.    2. In addition to the requirements of subsection 1, a plan    of merger may contain any other provision not prohibited by    law.    Sec. 89. NEW SECTION   . 489.1023 Approval of merger.    1. A plan of merger is not effective unless it has been    approved according to all of the following:    a. By a domestic merging limited liability company, by all    the members of the company entitled to vote on or consent to    any matter.    b. In a record, by each member of a domestic merging limited    liability company which will have interest holder liability for    debts, obligations, and other liabilities that are incurred     

  House File 655, p. 102   after the merger becomes effective, unless all of the following    apply:    (1) The operating agreement of the limited liability    company provides in a record for the approval of a merger in    which some or all of its members become subject to interest    holder liability by the affirmative vote or consent of fewer    than all the members.    (2) The member consented in a record to or voted for that    provision of the operating agreement or became a member after    the adoption of that provision.    2. A merger involving a domestic merging entity that is not    a limited liability company is not effective unless the merger    is approved by that entity in accordance with its organic law.    3. A merger involving a foreign merging entity is not    effective unless the merger is approved by the foreign entity    in accordance with the law of the foreign entitys jurisdiction    of formation.    Sec. 90. NEW SECTION   . 489.1024 Amendment or abandonment    of plan of merger.    1. A plan of merger may be amended only with the consent    of each party to the plan, except as otherwise provided in the    plan.    2. A domestic merging limited liability company may approve    an amendment of a plan of merger according to any of the    following:    a. In the same manner as the plan was approved, if the plan    does not provide for the manner in which it may be amended.    b. By its managers or members in the manner provided in the    plan, but a member that was entitled to vote on or consent to    approval of the merger is entitled to vote on or consent to any    amendment of the plan that will change any of the following:    (1) The amount or kind of interests, securities,    obligations, money, other property, rights to acquire interests    or securities, or any combination of the foregoing, to be    received by the interest holders of any party to the plan.    (2) The public organic record, if any, or private    organic rules of the surviving entity that will be in effect    immediately after the merger becomes effective, except for    changes that do not require approval of the interest holders of    

  House File 655, p. 103   the surviving entity under its organic law or organic rules.    (3) Any other terms or conditions of the plan, if the change    would adversely affect the member in any material respect.    3. After a plan of merger has been approved and before    a statement of merger becomes effective, the plan may be    abandoned as provided in the plan. Unless prohibited by the    plan, a domestic merging limited liability company may abandon    the plan in the same manner as the plan was approved.    4. If a plan of merger is abandoned after a statement of    merger has been delivered to the secretary of state for filing    and before the statement becomes effective, a statement of    abandonment, signed by a party to the plan, must be delivered    to the secretary of state for filing before the statement of    merger becomes effective. The statement of abandonment takes    effect on filing, and the merger is abandoned and does not    become effective. The statement of abandonment must contain    all of the following:    a. The name of each party to the plan of merger.    b. The date on which the statement of merger was filed by    the secretary of state.    c. A statement that the merger has been abandoned in    accordance with this section.    Sec. 91. NEW SECTION   . 489.1025 Statement of merger     effective date of merger.    1. A statement of merger must be signed by each merging    entity and delivered to the secretary of state for filing.    2. A statement of merger must contain all of the following:    a. The name, jurisdiction of formation, and type of entity    of each merging entity that is not the surviving entity.    b. The name, jurisdiction of formation, and type of entity    of the surviving entity, and if the surviving entity is a    foreign entity, the street and mailing addresses of an office    of the surviving entity that the secretary of state may use for    purposes of section 489.1026, subsection 5.    c. A statement that the merger was approved by each domestic    merging entity, if any, in accordance with this part and by    each foreign merging entity, if any, in accordance with the law    of its jurisdiction of formation.    d. If the surviving entity exists before the merger and is    

  House File 655, p. 104   a domestic filing entity, any amendment to its public organic    record approved as part of the plan of merger.    e. If the surviving entity is created by the merger and    is a domestic filing entity, its public organic record, as an    attachment.    f. If the surviving entity is created by the merger and    is a domestic limited liability partnership, its statement of    qualification, as an attachment.    3. In addition to the requirements of subsection 2, a    statement of merger may contain any other provision not    prohibited by law.    4. If the surviving entity is a domestic entity, its public    organic record, if any, must satisfy the requirements of the    law of this state, except that the public organic record does    not need to be signed.    5. If the surviving entity is a domestic limited liability    company, the merger becomes effective when the statement of    merger is effective. In all other cases, the merger becomes    effective on the later of the following:    a. The date and time provided by the organic law of the    surviving entity.    b. When the statement is effective.    Sec. 92. NEW SECTION   . 489.1026 Effect of merger.    1. When a merger becomes effective, all of the following    apply:    a. The surviving entity continues or comes into existence.    b. Each merging entity that is not the surviving entity    ceases to exist.    c. All property of each merging entity vests in the    surviving entity without transfer, reversion, or impairment.    d. All debts, obligations, and other liabilities of each    merging entity are debts, obligations, and other liabilities    of the surviving entity.    e. Except as otherwise provided by law or the plan of    merger, all the rights, privileges, immunities, powers, and    purposes of each merging entity vest in the surviving entity.    f. If the surviving entity exists before the merger, all of    the following apply:    (1) All its property continues to be vested in it without    

  House File 655, p. 105   transfer, reversion, or impairment.    (2) It remains subject to all its debts, obligations, and    other liabilities.    (3) All its rights, privileges, immunities, powers, and    purposes continue to be vested in it.    g. The name of the surviving entity may be substituted for    the name of any merging entity that is a party to any pending    action or proceeding.    h. If the surviving entity exists before the merger, all of    the following apply:    (1) Its public organic record, if any, is amended to the    extent provided in the statement of merger.    (2) Its private organic rules that are to be in a record, if    any, are amended to the extent provided in the plan of merger.    i. If the surviving entity is created by the merger, its    private organic rules are effective and all of the following    apply:    (1) If it is a filing entity, its public organic record    becomes effective.    (2) If it is a limited liability partnership, its statement    of qualification becomes effective.    j. The interests in each merging entity which are to be    converted in the merger are converted, and the interest holders    of those interests are entitled only to the rights provided to    them under the plan of merger and to any appraisal rights they    have under section 489.1006 and the merging entitys organic    law.    2. Except as otherwise provided in the organic law or    organic rules of a merging entity, the merger does not give    rise to any rights that an interest holder, governor, or third    party would have upon a dissolution, liquidation, or winding up    of the merging entity.    3. When a merger becomes effective, a person that did    not have interest holder liability with respect to any of    the merging entities and becomes subject to interest holder    liability with respect to a domestic entity as a result of    the merger has interest holder liability only to the extent    provided by the organic law of that entity and only for those    debts, obligations, and other liabilities that are incurred   

  House File 655, p. 106   after the merger becomes effective.    4. When a merger becomes effective, the interest holder    liability of a person that ceases to hold an interest in a    domestic merging limited liability company with respect to    which the person had interest holder liability is subject to    the following rules:    a. The merger does not discharge any interest holder    liability under this chapter to the extent the interest holder    liability was incurred before the merger became effective.    b. The person does not have interest holder liability under    this chapter for any debt, obligation, or other liability that    is incurred after the merger becomes effective.    c. This chapter continues to apply to the release,    collection, or discharge of any interest holder liability    preserved under paragraph a as if the merger had not occurred.    d. The person has whatever rights of contribution from    any other person as are provided by this chapter, law other    than this chapter, or the operating agreement of the domestic    merging limited liability company with respect to any interest    holder liability preserved under paragraph a as if the merger    had not occurred.    5. When a merger becomes effective, a foreign entity that is    the surviving entity may be served with process in this state    for the collection and enforcement of any debts, obligations,    or other liabilities of a domestic merging limited liability    company as provided in section 489.116.    6. When a merger becomes effective, the registration to do    business in this state of any foreign merging entity that is    not the surviving entity is canceled.    Sec. 93. NEW SECTION   . 489.1031 Interest exchange    authorized.    1. By complying with this part, any of the following apply:    a. A domestic limited liability company may acquire all    of one or more classes or series of interests of another      domestic entity or a foreign entity in exchange for interests,    securities, obligations, money, other property, rights to    acquire interests or securities, or any combination of the    foregoing.    b. All of one or more classes or series of interests of a      

  House File 655, p. 107   domestic limited liability company may be acquired by another    domestic entity or a foreign entity in exchange for interests,    securities, obligations, money, other property, rights to    acquire interests or securities, or any combination of the    foregoing.    2. By complying with the provisions of this part applicable    to foreign entities, a foreign entity may be the acquiring or    acquired entity in an interest exchange under this part if    the interest exchange is authorized by the law of the foreign    entitys jurisdiction of formation.    3. If a protected agreement contains a provision that    applies to a merger of a domestic limited liability company but    does not refer to an interest exchange, the provision applies    to an interest exchange in which the domestic limited liability    company is the acquired entity as if the interest exchange were    a merger until the provision is amended on or after January 1,    2009.    Sec. 94. NEW SECTION . 489.1032 Plan of interest exchange.    1. A domestic limited liability company may be the acquired    entity in an interest exchange under this part by approving a    plan of interest exchange. The plan must be in a record and    contain all of the following:    a. The name of the acquired entity.    b. The name, jurisdiction of formation, and type of entity    of the acquiring entity.    c. The manner of converting the interests in the acquired    entity into interests, securities, obligations, money, other    property, rights to acquire interests or securities, or any    combination of the foregoing.    d. Any proposed amendments to all of the following:    (1) The certificate of organization of the acquired entity.    (2) The operating agreement of the acquired entity that are,    or are proposed to be, in a record.    e. The other terms and conditions of the interest exchange.    f. Any other provision required by the law of this state or    the operating agreement of the acquired entity.    2. In addition to the requirements of subsection 1, a    plan of interest exchange may contain any other provision not    prohibited by law.    

  House File 655, p. 108   Sec. 95. NEW SECTION   . 489.1033 Approval of interest    exchange.    1. A plan of interest exchange is not effective unless it    has been approved according to all of the following:    a. By all the members of a domestic acquired limited    liability company entitled to vote on or consent to any matter.    b. In a record, by each member of the domestic acquired    limited liability company that will have interest holder    liability for debts, obligations, and other liabilities that    are incurred after the interest exchange becomes effective,    unless all of the following apply:    (1) The operating agreement of the limited liability    company provides in a record for the approval of an interest    exchange or a merger in which some or all of its members become    subject to interest holder liability by the affirmative vote or    consent of fewer than all the members.    (2) The member consented in a record to or voted for that    provision of the operating agreement or became a member after    the adoption of that provision.    2. An interest exchange involving a domestic acquired    entity that is not a limited liability company is not effective    unless it is approved by the domestic entity in accordance with    its organic law.    3. An interest exchange involving a foreign acquired entity    is not effective unless it is approved by the foreign entity in    accordance with the law of the foreign entitys jurisdiction    of formation.    4. Except as otherwise provided in its organic law or    organic rules, the interest holders of the acquiring entity are    not required to approve the interest exchange.    Sec. 96. NEW SECTION   . 489.1034 Amendment or abandonment      of plan of interest exchange.    1. A plan of interest exchange may be amended only with the    consent of each party to the plan, except as otherwise provided    in the plan.    2. A domestic acquired limited liability company may    approve an amendment of a plan of interest exchange according    to any of the following:    a. In the same manner as the plan was approved, if the plan     

  House File 655, p. 109   does not provide for the manner in which it may be amended.    b. By its managers or members in the manner provided in    the plan, but a member that was entitled to vote on or consent    to approval of the interest exchange is entitled to vote on or    consent to any amendment of the plan that will change any of    the following:    (1) The amount or kind of interests, securities,    obligations, money, other property, rights to acquire interests    or securities, or any combination of the foregoing, to be    received by any of the members of the acquired company under    the plan.    (2) The certificate of organization or operating agreement    of the acquired company that will be in effect immediately    after the interest exchange becomes effective, except for    changes that do not require approval of the members of the    acquired company under this chapter or the operating agreement.    (3) Any other terms or conditions of the plan, if the change    would adversely affect the member in any material respect.    3. After a plan of interest exchange has been approved and    before a statement of interest exchange becomes effective,    the plan may be abandoned as provided in the plan. Unless    prohibited by the plan, a domestic acquired limited liability    company may abandon the plan in the same manner as the plan was    approved.    4. If a plan of interest exchange is abandoned after a    statement of interest exchange has been delivered to the    secretary of state for filing and before the statement becomes    effective, a statement of abandonment, signed by the acquired    limited liability company, must be delivered to the secretary    of state for filing before the statement of interest exchange    becomes effective. The statement of abandonment takes effect    on filing, and the interest exchange is abandoned and does not    become effective. The statement of abandonment must contain    all of the following:    a. The name of the acquired limited liability company.    b. The date on which the statement of interest exchange was    filed by the secretary of state.    c. A statement that the interest exchange has been abandoned    in accordance with this section.   

  House File 655, p. 110   Sec. 97. NEW SECTION   . 489.1035 Statement of interest    exchange  effective date of interest exchange.    1. A statement of interest exchange must be signed by a    domestic acquired limited liability company and delivered to    the secretary of state for filing.    2. A statement of interest exchange must contain all of the    following:    a. The name of the acquired limited liability company.    b. The name, jurisdiction of formation, and type of entity    of the acquiring entity.    c. A statement that the plan of interest exchange was    approved by the acquired company in accordance with this part.    d. Any amendments to the acquired companys certificate of    organization approved as part of the plan of interest exchange.    3. In addition to the requirements of subsection 2, a    statement of interest exchange may contain any other provision    not prohibited by law.    4. An interest exchange becomes effective when the    statement of interest exchange is effective.    Sec. 98. NEW SECTION   . 489.1036 Effect of interest exchange.    1. When an interest exchange in which the acquired entity    is a domestic limited liability company becomes effective, all    of the following apply:    a. The interests in the acquired limited liability company    which are the subject of the interest exchange are converted,    and the members holding those interests are entitled only to    the rights provided to them under the plan of interest exchange    and to any appraisal rights they have under section 486.1006.    b. The acquiring entity becomes the interest holder of the    interests in the acquired limited liability company stated in    the plan of interest exchange to be acquired by the acquiring    entity.    c. The certificate of organization of the acquired limited    liability company is amended to the extent provided in the    statement of interest exchange.    d. The provisions of the operating agreement of the acquired    limited liability company that are to be in a record, if any,    are amended to the extent provided in the plan of interest    exchange.     

  House File 655, p. 111   2. Except as otherwise provided in the operating agreement    of a domestic acquired limited liability company, the interest    exchange does not give rise to any rights that a member,    manager, or third party would have upon a dissolution,    liquidation, or winding up of the acquired limited liability    company.    3. When an interest exchange becomes effective, a person    that did not have interest holder liability with respect to    a domestic acquired limited liability company and becomes    subject to interest holder liability with respect to a domestic    entity as a result of the interest exchange has interest holder    liability only to the extent provided by the organic law of    the entity and only for those debts, obligations, and other    liabilities that are incurred after the interest exchange    becomes effective.    4. When an interest exchange becomes effective, the    interest holder liability of a person that ceases to hold an    interest in a domestic acquired limited liability company with    respect to which the person had interest holder liability is    subject to all of the following rules:    a. The interest exchange does not discharge any interest    holder liability under this chapter to the extent the interest    holder liability was incurred before the interest exchange    became effective.    b. The person does not have interest holder liability under    this chapter for any debt, obligation, or other liability that    is incurred after the interest exchange becomes effective.    c. This chapter continues to apply to the release,    collection, or discharge of any interest holder liability    preserved under paragraph a as if the interest exchange had    not occurred.    d. The person has whatever rights of contribution from    any other person as are provided by this chapter, law other    than this chapter, or the operating agreement of the acquired    limited liability company with respect to any interest holder    liability preserved under paragraph a as if the interest    exchange had not occurred.    Sec. 99. NEW SECTION   . 489.1041 Conversion authorized.      1. By complying with this part, a domestic limited liability    

  House File 655, p. 112   company may become any of the following:    a. A domestic entity that is a different type of entity.    b. A foreign entity that is a different type of entity, if    the conversion is authorized by the law of the foreign entitys    jurisdiction of formation.    2. By complying with the provisions of this part applicable    to foreign entities, a foreign entity that is not a foreign    limited liability company may become a domestic limited    liability company if the conversion is authorized by the law of    the foreign entitys jurisdiction of formation.    3. If a protected agreement contains a provision that    applies to a merger of a domestic limited liability company    but does not refer to a conversion, the provision applies    to a conversion of the limited liability company as if the    conversion were a merger until the provision is amended on or    after January 1, 2009.    4. A domestic entity that is not a limited liability company    may become a domestic limited liability company if all of the    following apply:    a. The domestic converting entity complies with section    489.1043.    b. The domestic converting entity files a statement of    conversion in accordance with section 489.1045.    Sec. 100. NEW SECTION   . 489.1042 Plan of conversion.    1. A domestic limited liability company may convert to a    different type of entity under this part by approving a plan    of conversion. The plan must be in a record and contain all of    the following:    a. The name of the converting limited liability company.    b. The name, jurisdiction of formation, and type of entity    of the converted entity.    c. The manner of converting the interests in the converting    limited liability company into interests, securities,    obligations, money, other property, rights to acquire interests    or securities, or any combination of the foregoing.    d. The proposed public organic record of the converted    entity if it will be a filing entity.    e. The full text of the private organic rules of the    converted entity which are proposed to be in a record.    

  House File 655, p. 113   f. The other terms and conditions of the conversion.    g. Any other provision required by the law of this state    or the operating agreement of the converting limited liability    company.    2. In addition to the requirements of subsection 1, a plan    of conversion may contain any other provision not prohibited    by law.    Sec. 101. NEW SECTION   . 489.1043 Approval of conversion.    1. A plan of conversion is not effective unless it has been    approved according to all of the following:    a. By a domestic converting limited liability company, by    all the members of the limited liability company entitled to    vote on or consent to any matter.    b. In a record, by each member of a domestic converting    limited liability company which will have interest holder    liability for debts, obligations, and other liabilities that    are incurred after the conversion becomes effective, unless all    of the following apply:    (1) The operating agreement of the limited liability    company provides in a record for the approval of a conversion    or a merger in which some or all of its members become subject    to interest holder liability by the affirmative vote or consent    of fewer than all the members.    (2) The member voted for or consented in a record to that    provision of the operating agreement or became a member after    the adoption of that provision.    2. A conversion involving a domestic converting entity that    is not a limited liability company is not effective unless it    is approved by the domestic converting entity in accordance    with its organic law.    3. A conversion of a foreign converting entity is not    effective unless it is approved by the foreign entity in    accordance with the law of the foreign entitys jurisdiction    of formation.      Sec. 102. NEW SECTION . 489.1044 Amendment or abandonment of      plan of conversion.    1. A plan of conversion of a domestic converting limited    liability company may be amended according to any of the    following:     

  House File 655, p. 114   a. In the same manner as the plan was approved, if the plan    does not provide for the manner in which it may be amended.    b. By its managers or members in the manner provided in the    plan, but a member that was entitled to vote on or consent to    approval of the conversion is entitled to vote on or consent    to any amendment of the plan that will change any of the    following:    (1) The amount or kind of interests, securities,    obligations, money, other property, rights to acquire interests    or securities, or any combination of the foregoing, to be    received by any of the members of the converting limited    liability company under the plan.    (2) The public organic record, if any, or private organic    rules of the converted entity which will be in effect    immediately after the conversion becomes effective, except for    changes that do not require approval of the interest holders of    the converted entity under its organic law or organic rules.    (3) Any other terms or conditions of the plan, if the change    would adversely affect the member in any material respect.    2. After a plan of conversion has been approved by a    domestic converting limited liability company and before a    statement of conversion becomes effective, the plan may be    abandoned as provided in the plan. Unless prohibited by the    plan, a domestic converting limited liability company may    abandon the plan in the same manner as the plan was approved.    3. If a plan of conversion is abandoned after a statement    of conversion has been delivered to the secretary of state    for filing and before the statement becomes effective, a    statement of abandonment, signed by the converting entity,    must be delivered to the secretary of state for filing before    the statement of conversion becomes effective. The statement    of abandonment takes effect on filing, and the conversion is    abandoned and does not become effective. The statement of    abandonment must contain all of the following:    a. The name of the converting limited liability company.    b. The date on which the statement of conversion was filed      by the secretary of state.    c. A statement that the conversion has been abandoned in      accordance with this section.     

  House File 655, p. 115   Sec. 103. NEW SECTION   . 489.1045 Statement of conversion     effective date of conversion.    1. A statement of conversion must be signed by the    converting entity and delivered to the secretary of state for    filing.    2. A statement of conversion must contain all of the    following:    a. The name, jurisdiction of formation, and type of entity    of the converting entity.    b. The name, jurisdiction of formation, and type of entity    of the converted entity and if the converted entity is a    foreign entity, the street and mailing addresses of an office    of the converted entity that the secretary of state may use for    purposes of section 489.1046, subsection 5.    c. If the converting entity is a domestic limited liability    company, a statement that the plan of conversion was approved    in accordance with this part or, if the converting entity is a    foreign entity, a statement that the conversion was approved    by the foreign entity in accordance with the law of its    jurisdiction of formation.    d. If the converted entity is a domestic filing entity, its    public organic record, as an attachment.    e. If the converted entity is a domestic limited liability    partnership, its statement of qualification, as an attachment.    3. In addition to the requirements of subsection 2, a    statement of conversion may contain any other provision not    prohibited by law.    4. If the converted entity is a domestic entity, its public    organic record, if any, must satisfy the requirements of the    law of this state, except that the public organic record does    not need to be signed.    5. If the converted entity is a domestic limited liability    company, the conversion becomes effective when the statement of    conversion is effective. In all other cases, the conversion      becomes effective on the later of the following:    a. The date and time provided by the organic law of the    converted entity.    b. When the statement is effective.    Sec. 104. NEW SECTION   . 489.1046 Effect of conversion.       

  House File 655, p. 116   1. When a conversion becomes effective all of the following    apply:    a. The converted entity is any of the following:    (1) Organized under and subject to the organic law of the    converted entity.    (2) The same entity without interruption as the converting    entity.    b. All property of the converting entity continues to be    vested in the converted entity without transfer, reversion, or    impairment.    c. All debts, obligations, and other liabilities of the    converting entity continue as debts, obligations, and other    liabilities of the converted entity.    d. Except as otherwise provided by law or the plan of    conversion, all the rights, privileges, immunities, powers,    and purposes of the converting entity remain in the converted    entity.    e. The name of the converted entity may be substituted for    the name of the converting entity in any pending action or    proceeding.    f. The certificate of organization of the converted entity    becomes effective.    g. The provisions of the operating agreement of the    converted entity which are to be in a record, if any, approved    as part of the plan of conversion become effective.    h. The interests in the converting entity are converted, and    the interest holders of the converting entity are entitled only    to the rights provided to them under the plan of conversion and    to any appraisal rights they have under section 489.1006.    2. Except as otherwise provided in the operating agreement    of a domestic converting limited liability company, the    conversion does not give rise to any rights that a member,    manager, or third party would have upon a dissolution,    liquidation, or winding up of the converting entity.    3. When a conversion becomes effective, a person that    did not have interest holder liability with respect to the    converting entity and becomes subject to interest holder    liability with respect to a domestic entity as a result of the    conversion has interest holder liability only to the extent   

  House File 655, p. 117   provided by the organic law of the entity and only for those    debts, obligations, and other liabilities that are incurred    after the conversion becomes effective.    4. When a conversion becomes effective, the interest holder    liability of a person that ceases to hold an interest in a    domestic converting limited liability company with respect to    which the person had interest holder liability is subject to    all of the following rules:    a. The conversion does not discharge any interest holder    liability under this chapter to the extent the interest holder    liability was incurred before the conversion became effective.    b. The person does not have interest holder liability under    this chapter for any debt, obligation, or other liability that    arises after the conversion becomes effective.    c. This chapter continues to apply to the release,    collection, or discharge of any interest holder liability    preserved under paragraph a as if the conversion had not    occurred.    d. The person has whatever rights of contribution from any    other person as are provided by this chapter, law other than    this chapter, or the organic rules of the converting entity    with respect to any interest holder liability preserved under    paragraph a as if the conversion had not occurred.    5. When a conversion becomes effective, a foreign entity    that is the converted entity may be served with process in this    state for the collection and enforcement of any of its debts,    obligations, and other liabilities as provided in section    489.116.    6. If the converting entity is a registered foreign entity,    its registration to do business in this state is canceled when    the conversion becomes effective.    7. A conversion does not require the entity to wind up its    affairs and does not constitute or cause the dissolution of the    entity.    Sec. 105. NEW SECTION   . 489.1051 Domestication authorized.    1. By complying with this part, a domestic limited liability    company may become a foreign limited liability company if    the domestication is authorized by the law of the foreign    jurisdiction.    

  House File 655, p. 118   2. By complying with the provisions of this part applicable    to foreign limited liability companies, a foreign limited    liability company may become a domestic limited liability    company if the domestication is authorized by the law of the    foreign limited liability companys jurisdiction of formation.    3. If a protected agreement contains a provision that    applies to a merger of a domestic limited liability company    but does not refer to a domestication, the provision applies    to a domestication of the limited liability company as if the    domestication were a merger until the provision is amended on    or after January 1, 2009.    Sec. 106. NEW SECTION   . 489.1052 Plan of domestication.    1. A domestic limited liability company may become a foreign    limited liability company in a domestication by approving    a plan of domestication. The plan must be in a record and    contain all of the following:    a. The name of the domesticating limited liability company.    b. The name and jurisdiction of formation of the    domesticated limited liability company.    c. The manner of converting the interests in the    domesticating limited liability company into interests,    securities, obligations, money, other property, rights to    acquire interests or securities, or any combination of the    foregoing.    d. The proposed certificate of organization of the    domesticated limited liability company.    e. The full text of the provisions of the operating    agreement of the domesticated limited liability company that    are proposed to be in a record.    f. The other terms and conditions of the domestication.    g. Any other provision required by the law of this state or    the operating agreement of the domesticating limited liability    company.    2. In addition to the requirements of subsection 1, a plan    of domestication may contain any other provision not prohibited    by law.    Sec. 107. NEW SECTION   . 489.1053 Approval of domestication.    1. A plan of domestication of a domestic domesticating    limited liability company is not effective unless it has been     

  House File 655, p. 119   approved according to any of the following:    a. By all the members entitled to vote on or consent to any    matter.    b. In a record, by each member that will have interest    holder liability for debts, obligations, and other liabilities    that are incurred after the domestication becomes effective,    unless all of the following apply:    (1) The operating agreement of the domesticating limited    liability company in a record provides for the approval of a    domestication or merger in which some or all of its members    become subject to interest holder liability by the affirmative    vote or consent of fewer than all the members.    (2) The member voted for or consented in a record to that    provision of the operating agreement or became a member after    the adoption of that provision.    2. A domestication of a foreign domesticating limited    liability company is not effective unless it is approved in    accordance with the law of the foreign limited liability    companys jurisdiction of formation.    Sec. 108. NEW SECTION   . 489.1054 Amendment or abandonment    of plan of domestication.    1. A plan of domestication of a domestic domesticating    limited liability company may be amended according to any of    the following:    a. In the same manner as the plan was approved, if the plan    does not provide for the manner in which it may be amended.    b. By its managers or members in the manner provided in    the plan, but a member that was entitled to vote on or consent    to approval of the domestication is entitled to vote on or    consent to any amendment of the plan that will change any of    the following:    (1) The amount or kind of interests, securities,    obligations, money, other property, rights to acquire interests    or securities, or any combination of the foregoing, to be    received by any of the members of the domesticating limited    liability company under the plan.    (2) The certificate of organization or operating agreement    of the domesticated limited liability company that will be in    effect immediately after the domestication becomes effective,    

  House File 655, p. 120   except for changes that do not require approval of the members    of the domesticated limited liability company under its organic    law or operating agreement.    (3) Any other terms or conditions of the plan, if the change    would adversely affect the member in any material respect.    2. After a plan of domestication has been approved by a    domestic domesticating limited liability company and before a    statement of domestication becomes effective, the plan may be    abandoned as provided in the plan. Unless prohibited by the    plan, a domestic domesticating limited liability company may    abandon the plan in the same manner as the plan was approved.    3. If a plan of domestication is abandoned after a statement    of domestication has been delivered to the secretary of state    for filing and before the statement becomes effective, a    statement of abandonment, signed by the domesticating limited    liability company, must be delivered to the secretary of state    for filing before the statement of domestication becomes    effective. The statement of abandonment takes effect on    filing, and the domestication is abandoned and does not become    effective. The statement of abandonment must contain all of    the following:    a. The name of the domesticating limited liability company.    b. The date on which the statement of domestication was    filed by the secretary of state.    c. A statement that the domestication has been abandoned in    accordance with this section.    Sec. 109. NEW SECTION   . 489.1055 Statement of domestication     effective date of domestication.    1. A statement of domestication must be signed by the    domesticating limited liability company and delivered to the    secretary of state for filing.    2. A statement of domestication must contain all of the      following:    a. The name and jurisdiction of formation of the    domesticating limited liability company.    b. The name and jurisdiction of formation of the    domesticated limited liability company and the street and    mailing addresses of an office of the domesticated limited    liability company that the secretary of state may use for    

  House File 655, p. 121   purposes of section 489.1056, subsection 5.    c. If the domesticating limited liability company is a    domestic limited liability company, a statement that the plan    of domestication was approved in accordance with this part or,    if the domesticating limited liability company is a foreign    limited liability company, a statement that the domestication    was approved in accordance with the law of its jurisdiction of    formation.    d. The certificate of organization of the domesticated    limited liability company, as an attachment.    3. In addition to the requirements of subsection 2, a    statement of domestication may contain any other provision not    prohibited by law.    4. The certificate of organization of a domestic    domesticated limited liability company must satisfy the    requirements of this chapter, but the certificate does not need    to be signed.    5. If the domesticated entity is a domestic limited    liability company, the domestication becomes effective    when the statement of domestication is effective. If the    domesticated entity is a foreign limited liability company,    the domestication becomes effective on the later of all of the    following:    a. The date and time provided by the organic law of the    domesticated entity.    b. When the statement is effective.    Sec. 110. NEW SECTION   . 489.1056 Effect of domestication.    1. When a domestication becomes effective, all of the    following apply:    a. The domesticated entity is all of the following:    (1) Organized under and subject to the organic law of the    domesticated entity.    (2) The same entity without interruption as the    domesticating entity.    b. All property of the domesticating entity continues to be    vested in the domesticated entity without transfer, reversion,    or impairment.    c. All debts, obligations, and other liabilities of the    domesticating entity continue as debts, obligations, and other    

  House File 655, p. 122   liabilities of the domesticated entity.    d. Except as otherwise provided by law or the plan of    domestication, all the rights, privileges, immunities,    powers, and purposes of the domesticating entity remain in the    domesticated entity.    e. The name of the domesticated entity may be substituted    for the name of the domesticating entity in any pending action    or proceeding.    f. The certificate of organization of the domesticated    entity becomes effective.    g. The provisions of the operating agreement of the    domesticated entity that are to be in a record, if any,    approved as part of the plan of domestication become effective.    h. The interests in the domesticating entity are converted    to the extent and as approved in connection with the    domestication, and the members of the domesticating entity are    entitled only to the rights provided to them under the plan    of domestication and to any appraisal rights they have under    section 489.1006.    2. Except as otherwise provided in the organic law or    operating agreement of the domesticating limited liability    company, the domestication does not give rise to any rights    that a member, manager, or third party would otherwise    have upon a dissolution, liquidation, or winding up of the    domesticating company.    3. When a domestication becomes effective, a person that    did not have interest holder liability with respect to the    domesticating limited liability company and becomes subject to    interest holder liability with respect to a domestic limited    liability company as a result of the domestication has interest    holder liability only to the extent provided by this chapter    and only for those debts, obligations, and other liabilities    that are incurred after the domestication becomes effective.    4. When a domestication becomes effective, the interest      holder liability of a person that ceases to hold an interest in    a domestic domesticating limited liability company with respect    to which the person had interest holder liability is subject    to all of the following rules:    a. The domestication does not discharge any interest   

  House File 655, p. 123   holder liability under this chapter to the extent the interest    holder liability was incurred before the domestication became    effective.    b. A person does not have interest holder liability under    this chapter for any debt, obligation, or other liability that    is incurred after the domestication becomes effective.    c. This chapter continues to apply to the release,    collection, or discharge of any interest holder liability    preserved under paragraph a as if the domestication had not    occurred.    d. A person has whatever rights of contribution from any    other person as are provided by this chapter, law other than    this chapter, or the operating agreement of the domestic    domesticating limited liability company with respect to any    interest holder liability preserved under paragraph a as if    the domestication had not occurred.    5. When a domestication becomes effective, a foreign    limited liability company that is the domesticated company    may be served with process in this state for the collection    and enforcement of any of its debts, obligations, and other    liabilities as provided in section 489.116.    6. If the domesticating limited liability company is a    registered foreign entity, the registration of the limited    liability company is canceled when the domestication becomes    effective.    7. A domestication does not require a domestic    domesticating limited liability company to wind up its affairs    and does not constitute or cause the dissolution of the limited    liability company.    Sec. 111. Section 489.1101, Code 2023, is amended to read    as follows:    489.1101 Definitions.      As used in this article   subchapter , unless the context    otherwise requires:    1. Employee or agent does not include a clerk,    stenographer, secretary, bookkeeper, technician, or other    person who is not usually and ordinarily considered by custom    and practice to be practicing a profession nor any other person    who performs all that persons duties for the professional     

  House File 655, p. 124   limited liability company under the direct supervision and    control of one or more managers, employees, or agents of the    professional limited liability company who are duly licensed in    this state to practice a profession which the limited liability    company is authorized to practice in this state. This article      subchapter   does not require any such persons to be licensed to    practice a profession if they are not required to be licensed    under any other law of this state.    2. Foreign professional limited liability company means    a limited liability company organized under laws other than    the laws of this state for a purpose for which a professional    limited liability company may be organized under this article      subchapter .    3. Licensed includes registered, certified, admitted to    practice, or otherwise legally authorized under the laws of    this state.    4. Profession means the following professions:    a. Certified public accountancy.    b. Architecture.    c. Chiropractic.    d. Dentistry.    e. Physical therapy.    f. Practice as a physician assistant.    g. Psychology.    h. Professional engineering.    i. Land surveying.    j. Landscape architecture.    k. Law.      l. Medicine and surgery.    m. Optometry.    n. Osteopathic medicine and surgery.    o. Accounting practitioner.    p. Podiatry.    q. Real estate brokerage.    r. Speech pathology.    s. Audiology.    t. Veterinary medicine.    u. Pharmacy.    v. Nursing.       

  House File 655, p. 125   w. Marital and family therapy or mental health counseling,    provided that the marital and family therapist or mental health    counselor is licensed under chapters 147 and 154D .    x. Social work, provided that the social worker is licensed    pursuant to chapter 147 and section 154C.3, subsection 1 ,    paragraph c .    5. Professional limited liability company means a limited    liability company subject to this article   subchapter , except a    foreign professional limited liability company.    6. Regulating board means any board, commission, court,    or governmental authority which, under the laws of this state,    is charged with the licensing, registration, certification,    admission to practice, or other legal authorization of the    practitioners of any profession.    7. a. Voluntary transfer includes a sale, voluntary    assignment, gift, pledge, or encumbrance; a voluntary change    of legal or equitable ownership or beneficial interest; or a    voluntary change of persons having voting rights with respect    to any transferable interest, except as proxies.    b. Voluntary transfer does not include a transfer of    an individuals interest in a limited liability company or    other property to a guardian or conservator appointed for that    individual or the individuals property.    Sec. 112. Section 489.1106, Code 2023, is amended to read    as follows:    489.1106 Professional regulation.    A professional limited liability company shall not    be required to register with or to obtain any license,    registration, certificate, or other legal authorization from    a regulating board in order to practice a profession. Except    as provided in this section , this article   subchapter does not    restrict or limit in any manner the authority or duties of any    regulating board with respect to individuals   an individual    practicing a profession which is within the jurisdiction of the    regulating board, even if the individual is a member, manager,    employee, or agent of a professional limited liability company    or foreign professional limited liability company and practices    the individuals profession through such professional limited    liability company.         

  House File 655, p. 126   Sec. 113. Section 489.1107, Code 2023, is amended to read    as follows:    489.1107 Relationship and liability to persons served.    This article   subchapter does not modify any law applicable    to the relationship between an individual practicing a    profession and a person receiving professional services,    including but not limited to any liability arising out of such    practice or any law respecting privileged communications.    This article   subchapter does not modify or affect the ethical    standards or standards of conduct of any profession, including    but not limited to any standards prohibiting or limiting the    practice of the profession by a limited liability company or    prohibiting or limiting the practice of two or more professions    in combination. All such standards shall apply to the members,    managers, employees, and agents through whom a professional    limited liability company practices any profession in this    state, to the same extent that the standards apply to an    individual practitioner.    Sec. 114. Section 489.1110, Code 2023, is amended to read    as follows:    489.1110 Convertible interests  rights and options.    A professional limited liability company shall not create    or issue any interest convertible into an interest of the    professional limited liability company. The provisions of this    article   subchapter with respect to the issuance and transfer    of interests apply to the creation, issuance, and transfer    of any right or option entitling the holder to purchase from    a professional limited liability company any interest of the    professional limited liability company. A right or option    shall not be transferable, whether voluntarily, involuntarily,    by operation of law, or in any other manner. Upon the death    of the holder, or when the holder ceases to be licensed to      practice a profession in this state which the professional    limited liability company is authorized to practice, the right    or option shall expire.    Sec. 115. Section 489.1112, subsections 4, 5, and 6, Code    2023, are amended to read as follows:    4. When a person other than a member of record becomes    entitled to have interests of a professional limited liability         

  House File 655, p. 127   company transferred into that persons name or to exercise    voting rights, except as a proxy, with respect to interests of    the professional limited liability company, the professional    limited liability company shall immediately purchase the    interests. Without limiting the generality of the foregoing,    this section shall be applicable whether the event occurs    as a result of appointment of a guardian or conservator for    a member or the members property, transfer of interests    by operation of law, involuntary transfer of interests,    judicial proceeding, execution, levy, bankruptcy proceeding,    receivership proceeding, foreclosure or enforcement of a pledge    or encumbrance, or any other situation or occurrence. However,    this section does not apply to any voluntary transfer of    interests as defined in this article   subchapter .    5. Interests purchased by a professional limited liability    company under this section shall be transferred to the    professional limited liability company as of the close    of business on the date of the death or other event which    requires purchase. The member and the members executors,    administrators, legal representatives, or successors in    interest, shall promptly do all things which may be necessary    or convenient to cause transfer to be made as of the transfer    date. However, the interests shall promptly be transferred on    the books and records of the professional limited liability    company as of the transfer date, notwithstanding any delay in    transferring or surrendering the interests or certificates    representing the interests, and the transfer shall be valid and    effective for all purposes as of the close of business on the    transfer date. The purchase price for such interests shall be    paid as provided in this article   subchapter , but the transfer    of interests to the professional limited liability company as    provided in this section shall not be delayed or affected by    any delay or default in making payment.    6. a.   Notwithstanding subsections 1 through 5 , purchase by    the professional limited liability company is not required upon    the occurrence of any event other than death of a member, if    the professional limited liability company is dissolved within    sixty days after the occurrence of the event or voluntarily      elects to no longer be a professional limited liability company          

  House File 655, p. 128   but continue its existence as a limited liability company      pursuant to section 489.1119A within sixty days after the    occurrence of the event   . The certificate of organization or    operating agreement of the professional limited liability    company may provide that purchase is not required upon the    death of a member, if the professional limited liability    company is dissolved within sixty days after the date of the    members death.    b.   Notwithstanding sections 1 through 5, purchase by the    professional limited liability company is not required upon the    death of a member if the professional limited liability company      voluntarily elects to no longer be a professional limited    liability company but continue its existence as a limited    liability company pursuant to section 489.1119A within sixty      days after death.    Sec. 116. Section 489.1113, Code 2023, is amended to read    as follows:    489.1113 Certificates representing interests.    Each certificate representing an interest of a professional    limited liability company shall state in substance that the    certificate represents an interest in a professional limited    liability company and is not transferable except as expressly    provided in this article   subchapter and in the certificate of    organization or an operating agreement of the professional    limited liability company.    Sec. 117. Section 489.1114, Code 2023, is amended to read    as follows:    489.1114 Management.    1.   All managers of a professional limited liability    company shall at all times be individuals who are licensed to    practice a profession in this state or a lawful combination of    professions pursuant to section 489.1102 , which the limited    liability company is authorized to practice. A person who      is not licensed shall have no authority or duties in the    management or control of the professional limited liability      company. If a manager ceases to have this qualification, the    manager shall immediately and automatically cease to hold such      management position.    2. Notwithstanding subsection 1, upon the occurrence of                           

  House File 655, p. 129   any event that requires the professional limited liability      company either to be dissolved or to elect to no longer be    a professional limited liability company but continue its      existence as a limited liability company, as provided in      section 489.1119A, all of the following apply:    a.   The professional limited liability company ceases to    practice the profession that the professional limited liability      company is authorized to practice, as provided in section    489.1119A.      b. The individuals who are not licensed to practice in this    state a profession that the professional limited liability      company is authorized to practice may be appointed as officers    and directors for the sole purpose of doing any of the    following:      (1) Carrying out the dissolution of the professional    limited liability company.      (2) If applicable, carrying out the voluntary election    of the professional limited liability company to no longer    be a professional limited liability company but continue its      existence as a limited liability company, as provided in    section 489.1119A.    Sec. 118. Section 489.1115, Code 2023, is amended to read    as follows:    489.1115 Merger.    A professional limited liability company shall not merge    with any entity except another professional limited liability    company subject to this article   subchapter or a professional    corporation subject to chapter 496C . Merger is not permitted    unless the surviving or new professional limited liability    company is a professional limited liability company which   that    complies with all requirements of this article   subchapter .    Sec. 119. Section 489.1116, Code 2023, is amended to read      as follows:      489.1116 Dissolution or liquidation.    A violation of any provision of this article   subchapter by a    professional limited liability company or any of its members    or managers shall be cause for its involuntary dissolution, or    liquidation of its assets and business by the district court.    Upon the death of the last remaining member of a professional                                        

  House File 655, p. 130   limited liability company, or when the last remaining member is    not licensed or ceases to be licensed to practice a profession    in this state which the professional limited liability company    is authorized to practice, or when any person other than    the member of record becomes entitled to have all interests    of the last remaining member of the professional limited    liability company transferred into that persons name or to    exercise voting rights, except as a proxy, with respect to such    interests, the professional limited liability company shall not    practice any profession and it   . In that case, the professional    limited liability company   shall either be promptly dissolved    or shall promptly elect to no longer be a professional limited    liability company but continue its existence as a limited    liability company as provided in section 489.1119A   . However,    if prior to dissolution all outstanding interests of the    professional limited liability company are acquired by two    or more persons licensed to practice a profession in this    state which the professional limited liability company is    authorized to practice, the professional limited liability    company need not be dissolved nor elect to no longer be a      professional limited liability company and may instead practice    the profession as provided in this article   subchapter .    Sec. 120. Section 489.1117, Code 2023, is amended to read    as follows:    489.1117 Foreign professional limited liability company.    1. A foreign professional limited liability company may    practice a profession in this state if it complies with the    provisions of this article   subchapter . The secretary of state    may prescribe forms for this purpose. A foreign professional    limited liability company may practice a profession in this    state only through members, managers, employees, and agents    who are licensed to practice the profession in this state.    The provisions of this article   subchapter with respect to the    practice of a profession by a professional limited liability    company apply to a foreign professional limited liability    company.    2. This article   subchapter does not prohibit the practice    of a profession in this state by an individual who is a member,    manager, employee, or agent of a foreign professional limited                     

  House File 655, p. 131   liability company, if the individual could lawfully practice    the profession in this state in the absence of any relationship    to a foreign professional limited liability company. This    subsection applies regardless of whether or not the foreign    professional limited liability company is authorized to    practice a profession in this state.    Sec. 121. Section 489.1118, Code 2023, is amended to read    as follows:    489.1118 Limited liability companies organized under the    other laws.    This article   subchapter does not apply to or interfere with    the practice of any profession by or through any professional    limited liability company organized after July 1, 1992, under    any other law of this state or any other state or country, if    the practice is lawful under any other statute or rule of law    of this state. Any such professional limited liability company    may voluntarily elect to adopt this article   subchapter and    become subject to its provisions, by amending its certificate    of organization to be consistent with all provisions of this    article   subchapter and by stating in its amended certificate    of organization that the limited liability company has    voluntarily elected to adopt this article   subchapter . Any    limited liability company organized under any law of any other    state or country may become subject to the provisions of this    article   subchapter by complying with all provisions of this    article subchapter with respect to foreign professional limited    liability companies.    Sec. 122. Section 489.1119, Code 2023, is amended to read    as follows:    489.1119 Conflicts with other provisions of this chapter .    The provisions of this article   subchapter shall prevail over    any inconsistent provisions of this chapter .    Sec. 123. NEW SECTION   . 489.1119A Election to no longer be    a professional limited liability company.    A professional limited liability company may elect to no    longer be a professional limited liability company but continue    its existence as a limited liability company by filing with    the secretary of state an amendment to or restatement of its    certificate of organization that states that the limited                  

  House File 655, p. 132   liability company is no longer a professional limited liability    company and amending its name to no longer indicate it is a    professional limited liability company.    Sec. 124. NEW SECTION   . 489.1204 Severability clause.    If any provision of this chapter or its application to any    person or circumstance is held invalid, the invalidity does    not affect other provisions or applications of this chapter    which can be given effect without the invalid provision or    application, and to this end the provisions of this chapter are    severable.    Sec. 125. NEW SECTION   . 489.1207 Application to existing    relationships.    1. For purposes of applying this chapter to a limited    liability company formed before the effective date of this    Act, references in the limited liability companys operating    agreement to provisions in this chapter in effect before the    effective date of this Act are deemed to be references to the    comparable provision in this chapter after the effective date    of this Act.    2. A limited liability company that has published notice of    its dissolution and requested persons having claims against the    limited liability company to present them in accordance with    the notice pursuant to section 489.703 as that section existed    immediately prior to the effective date of this Act shall be    subject to the requirements set forth in that section as it    existed immediately prior to the effective date of this Act,    including the right of a claim by a person that is commenced    within five years after publication of the notice.    3. For the purposes of applying this chapter to a limited    liability company formed before January 1, 2009, all of the    following apply:    a. The limited liability companys articles of organization    are deemed to be the companys certificate of organization.    b. For the purposes of applying section 489.102, subsection    15, and subject to section 489.112, subsection 4, language    in the limited liability companys articles of organization    designating the limited liability companys management    structure operates as if that language were in the operating    agreement.     

  House File 655, p. 133   c. If a professional limited liability companys name    complied with section 490A.1503 as that section existed on    December 30, 2010, that companys name shall also be deemed to    comply with the name requirements of section 489.1103 of the    2011 edition of the Iowa Code.    Sec. 126. Section 489.14101, Code 2023, is amended to read    as follows:    489.14101 Short title.    This article   subchapter may be cited as the Uniform    Protected Series Act .    Sec. 127. Section 489.14102, unnumbered paragraph 1, Code    2023, is amended to read as follows:    As used in this article   subchapter , unless the context    otherwise requires:    Sec. 128. Section 489.14102, subsections 4 and 9, Code 2023,    are amended to read as follows:    4. Foreign protected series means an arrangement,    configuration, or other structure established by a foreign    limited liability company which has attributes comparable to    a protected series established under this article   subchapter .    The term applies whether or not the law under which the foreign    company is organized refers to protected series.    9. Protected-series manager means a person under whose    authority the powers of a protected series are exercised    and under whose direction the activities and affairs of the    protected series are managed under the operating agreement,    this article   subchapter , and this chapter .    Sec. 129. Section 489.14104, subsection 4, paragraph c,    Code 2023, is amended to read as follows:    c. Except as permitted by law of this state other than    this article   subchapter , have a purpose or power that the law    of this state other than this article subchapter prohibits a    limited liability company from doing or having.    Sec. 130. Section 489.14106, subsections 2, 3, and 4, Code      2023, are amended to read as follows:    2. If this chapter otherwise restricts the power of an    operating agreement to affect a matter, the restriction applies    to a matter under this article   subchapter in accordance with    section 489.14108 .                 

  House File 655, p. 134   3. If law of this state other than this article   subchapter    imposes a prohibition, limitation, requirement, condition,    obligation, liability, or other restriction on a limited    liability company, a member, manager, or other agent of the    company, or a transferee of the company, except as otherwise    provided in law of this state other than this article      subchapter   , the restriction applies in accordance with section    489.14108 .    4. Except as otherwise provided in section 489.14107 , if the    operating agreement of a series limited liability company does    not provide for a matter described in subsection 1 in a manner    permitted by this article   subchapter , the matter is determined    in accordance with the following rules:    a. To the extent this article   subchapter addresses the    matter, this article subchapter governs.    b. To the extent this article   subchapter does not address    the matter, the other articles subchapters of this chapter    govern the matter in accordance with section 489.14108 .    Sec. 131. Section 489.14107, subsection 1, paragraphs v, w,    x, and y, Code 2023, are amended to read as follows:    v. Article 6   Subchapter VI .    w. Article 7   Subchapter VII .    x. Article 8 Subchapter VIII .    y. A provision of this article   subchapter pertaining to any    of the following:    (1) Registered agents.    (2) The secretary of state, including provisions pertaining    to records authorized or required to be delivered to the    secretary of state for filing under this article   subchapter .    Sec. 132. Section 489.14108, subsection 2, paragraph b,    subparagraphs (1) and (2), Code 2023, are amended to read as    follows:      (1) Accept for filing a type of record that neither this    article   subchapter nor any of the other articles subchapters of    this chapter authorizes or requires a person to deliver to the    secretary of state for filing.    (2) Make or deliver a record that neither this article      subchapter nor the other articles subchapters of this chapter    authorizes or requires the secretary of state to make or                                   

  House File 655, p. 135   deliver.    Sec. 133. Section 489.14204, subsection 1, paragraph c,    Code 2023, is amended to read as follows:    c. Other means authorized by law of this state other than    the other articles   subchapters of this chapter .    Sec. 134. Section 489.14301, subsection 5, unnumbered    paragraph 1, Code 2023, is amended to read as follows:    To the extent permitted by this section and law of this    state other than this article   subchapter , a series limited    liability company or protected series of the company may    hold an associated asset directly or indirectly, through a    representative, nominee, or similar arrangement, except that    all of the following applies:    Sec. 135. Section 489.14303, subsection 4, Code 2023, is    amended to read as follows:    4. Except for section 489.14108, subsection 1 , paragraph    c , a provision of this article   subchapter which applies    to a protected-series transferee of a protected series of a    series limited liability company applies to the company in    its capacity as an owner of a protected-series transferable    interest of the protected series. A provision of the operating    agreement of a series limited liability company which applies    to a protected-series transferee of a protected series of the    company applies to the company in its capacity as an owner of a    protected-series transferable interest of the protected series.    Sec. 136. Section 489.14304, subsection 6, Code 2023, is    amended to read as follows:    6. Article 9   Subchapter IX applies to a protected series in    accordance with section 489.14108 .    Sec. 137. Section 489.14402, subsection 3, paragraph b,    Code 2023, is amended to read as follows:    b. The claim is to establish or enforce a liability arising    under law of this state other than this article   subchapter or    from an act or omission in this state.      Sec. 138. Section 489.14404, subsection 3, Code 2023, is      amended to read as follows:    3. In addition to any other remedy provided by law or    equity, if a claim against a series limited liability company    or a protected series has not been reduced to a judgment and             

  House File 655, p. 136   law other than this article   subchapter permits a prejudgment    remedy by attachment, levy, or the like, the court may apply    subsection 2 as a prejudgment remedy.    Sec. 139. Section 489.14404, subsection 5, paragraph b,    Code 2023, is amended to read as follows:    b. The claimant is a resident of this state or doing    business or authorized to do business in this state, or the    claim under section 489.14404 is to enforce a judgment, or to    seek a prejudgment remedy, pertaining to a liability arising    from law of this state other than this article   subchapter or an    act or omission in this state.    Sec. 140. Section 489.14801, Code 2023, is amended to read    as follows:    489.14801 Uniformity of application and construction.    In applying and construing this article   subchapter ,    consideration shall be given to the need to promote uniformity    of the law with respect to its subject matter among states    that enact the uniform protected series Act as approved and    recommended by the national conference of commissioners on    uniform state laws.    Sec. 141. Section 489.14804, Code 2023, is amended to read    as follows:    489.14804 Savings clause.    This article   subchapter does not affect an action commenced,    proceeding brought, or right accrued before July 1, 2020.    Sec. 142. REPEAL. Sections 489.113, 489.802, 489.803,    489.804, 489.805, 489.806, 489.807, 489.808, 489.1008,    489.1009, 489.1010, 489.1011, 489.1012, 489.1013, 489.1014,    489.1015, 489.1016, and 489.1304, Code 2023, are repealed.    Sec. 143. CODE EDITOR DIRECTIVE.    1. The Code editor is directed to make the following    transfers:      a. Section 489.104 to section 489.108.      b. Section 489.105 to section 489.109.      c. Section 489.106 to section 489.104.      d. Section 489.107 to section 489.111.    e. Section 489.108 to section 489.112.    f. Section 489.109 to section 489.113.      g. Section 489.110 to section 489.105.           

  House File 655, p. 137   h. Section 489.111 to section 489.106.    i. Section 489.112 to section 489.107.    j. Section 489.114 to section 489.116.    k. Section 489.114A, as enacted by this Act, to section    489.114.    l. Section 489.115 to section 489.117.    m. Section 489.115A, as enacted by this Act, to section    489.115.    n. Section 489.116 to section 489.119.    o. Section 489.117 to section 489.122.    p. Section 489.205A to section 489.122A.    q. Section 489.206 to section 489.209.    r. Section 489.206A, as enacted by this Act, to section    489.206.    s. Section 489.208 to section 489.211.    t. Section 489.208A, as enacted by this Act, to section    489.208.    u. Section 489.209 to section 489.211A.    v. Section 489.701A to section 489.703.    w. Section 489.703 to section 489.704.    x. Section 489.704 to section 489.705.    y. Section 489.705 to section 489.708.    z. Section 489.706 to section 489.710.    aa. Section 489.706A, as enacted by this Act, to section    489.706.    ab. Section 489.707 to section 489.711.    ac. Section 489.708 to section 489.707.    ad. Section 489.801 to section 489.901.    ae. Section 489.805A, as enacted by this Act, to section    489.805.    af. Section 489.809 to section 489.912.    ag. Section 489.901 to section 489.801.    ah. Section 489.902 to section 489.802.    ai. Section 489.903 to section 489.803.      aj. Section 489.904 to section 489.804.    ak. Section 489.906 to section 489.806.    al. Section 489.906A, as enacted by this Act, to section    489.906.    am. Section 489.911A to section 489.902.     

  House File 655, p. 138   an. Section 489.911B to section 489.903.    ao. Section 489.911C to section 489.904.    ap. Section 489.1119 to section 489.1120.    aq. Section 489.1119A to section 489.1119.    ar. Section 489.1301 to section 489.1201.    as. Section 489.1302 to section 489.1202.    at. Section 489.1303 to section 489.1203.    2. The Code editor shall correct internal references in the    Code and in any enacted legislation as necessary due to the    enactment of this section.    Sec. 144. DIRECTIONS TO THE CODE EDITOR  DIVIDING    SUBCHAPTER X INTO PARTS. The Code editor is directed to divide    the provisions of chapter 489, subchapter X, as amended or    enacted in this division of this Act, into parts as follows:    1. Part 1, including sections 489.1001 through 489.1007.    2. Part 2, including sections 489.1021 through 489.1026.    3. Part 3, including sections 489.1031 through 489.1036.    4. Part 4, including sections 489.1041 through 489.1046.    5. Part 5, including sections 489.1051 through 489.1056.    DIVISION II    COORDINATING AMENDMENTS    Sec. 145. Section 9.11, subsection 1, paragraph c, Code    2023, is amended to read as follows:    c. Chapter 489 , including as provided in section 489.205,      489.205A and as stated in section 489.117 or as otherwise    described in sections 489.112, 489.302 , 489.702 , 489.1008 ,    489.1012 , and 489.14502 section 489.210 .    Sec. 146. Section 10.1, subsection 9, paragraph b, Code    2023, is amended to read as follows:    b. As used in paragraph a , a type of membership interest    in a limited liability company includes a protected series as    provided in chapter 489, article 14   subchapter XIV .    Sec. 147. Section 10.1, subsection 17, paragraph b, Code    2023, is amended to read as follows:      b. As used in paragraph a , a type of membership interest    in a limited liability company includes a protected series of a    series limited liability company as provided in chapter 489,    article 14   subchapter XIV .    Sec. 148. Section 10.10, subsection 1, paragraph c,                    

  House File 655, p. 139   subparagraph (2), Code 2023, is amended to read as follows:    (2) As used in subparagraph (1), a type of membership    interest in a limited liability company includes a protected    series of a series limited liability company as provided in    chapter 489, article 14   subchapter XIV .    Sec. 149. Section 488.108, subsection 4, paragraph b,    subparagraph (4), Code 2023, is amended to read as follows:    (4) For a limited liability company under chapter 489 ,    section 489.108 , 489.109 , 489.114A,   or 489.706 .    Sec. 150. Section 490.401, subsection 2, paragraph h,    subparagraph (4), Code 2023, is amended to read as follows:    (4) For a limited liability company under chapter 489 ,    section 489.108 , 489.109 , 489.114A,   or 489.706 .    Sec. 151. Section 501A.102, subsection 13, Code 2023, is    amended by striking the subsection.    Sec. 152. Section 501A.1101, subsections 1, 2, and 5, Code    2023, are amended to read as follows:    1. Authorization. Unless otherwise prohibited, cooperatives    organized under the laws of this state, including cooperatives    organized under this chapter or traditional cooperatives, may    merge or consolidate with each other, an Iowa limited liability      company under the provisions of   section 489.1015 , or other    another business entities entity organized under the laws    of another state ,   by complying with the provisions of this    section and the law of the state where the surviving or new    business entity will exist. A cooperative shall not merge or    consolidate with a business entity organized under the laws    of this state, other than a traditional cooperative, unless    the law governing the business entity expressly authorizes    merger or consolidation with a cooperative. This subsection    does not authorize a foreign business entity to do any act not    authorized by the law governing the foreign business entity.    2. Plan. To initiate a merger or consolidation of a    cooperative, a written plan of merger or consolidation shall be    prepared by the board or by a committee selected by the board    to prepare a plan. The plan shall state all of the following:    a. The names of the   each constituent domestic cooperative ,    the name of any Iowa limited liability company that is a party    to the merger , to the extent authorized under section 489.1015 ,                       

  House File 655, p. 140   and any foreign business entities   entity that is a party to the    merger .    b. The name of the surviving or new domestic cooperative ,      Iowa limited liability company as required by   section 489.1015 ,    or other foreign business entity.    c. The manner and basis of converting membership or    ownership interests of the constituent domestic cooperative ,      the Iowa limited liability company that is a party as provided    in   section 489.1015 , or foreign business entity into membership    or ownership interests in the surviving or new domestic    cooperative, the surviving Iowa limited liability company as      authorized in section 489.1015 , or foreign business entity.    d. The terms of the merger or consolidation.    e. The proposed effect of the merger or consolidation on    the members and patron members of each constituent domestic    cooperative.    f. For a consolidation, the plan shall contain the articles    of the entity or organizational documents to be filed with the    state in which the entity is organized or, if the surviving      organization is an Iowa limited liability company, the articles    of organization .    5. Effect of merger or consolidation. For a merger that does      not involve an Iowa limited liability company, the following    shall apply to the   The effect of a merger or consolidation    shall be as follows :    a. After the effective date, the each domestic cooperative,    Iowa limited liability company, if party to the plan,    cooperatives and any foreign business entity that is a party to    the plan become a single entity. For a merger, the surviving    business entity is the business entity designated in the plan.    For a consolidation, the new domestic cooperative , the Iowa      limited liability company, if any, and any or new foreign    business entity is the business entity provided for in the    plan. Except for the surviving or new domestic cooperative,    Iowa limited liability company,   or foreign business entity, the    separate existence of each merged or consolidated domestic or    foreign business entity that is a party to the plan ceases on    the effective date of the merger or consolidation.    b. The surviving or new domestic cooperative , Iowa limited                                         

  House File 655, p. 141   liability company,   or foreign business entity possesses all of    the rights and property of each of the merged or consolidated    business entities and is responsible for all their obligations.    The title to property of the merged or consolidated domestic    cooperative, Iowa limited liability company, or foreign    business entity ,   is vested in the surviving or new domestic    cooperative, Iowa limited liability company,   or foreign    business entity without reversion or impairment of the title    caused by the merger or consolidation.    c.   If a merger involves an Iowa limited liability company,    this subsection   is subject to the provisions of section    489.1015 .    Sec. 153. Section 501A.1102, subsection 1, Code 2023, is    amended to read as follows:    1. Definition. For purposes of this section , subsidiary    means a domestic cooperative , an Iowa limited liability      company, or a foreign cooperative.    Sec. 154. Section 501A.1102, subsection 2, unnumbered    paragraph 1, Code 2023, is amended to read as follows:    An Iowa limited liability company may only participate      in a merger under this section to the extent authorized    under   section 489.1015 . A parent domestic cooperative or    a subsidiary that is a domestic cooperative may complete    the merger of a subsidiary as provided in this section .    However, if either the parent cooperative or the subsidiary    is a business entity organized under the laws of this state,    the merger of the subsidiary is not authorized under this    section unless the law governing the business entity expressly    authorizes merger with a cooperative.    Sec. 155. Section 501A.1103, subsection 2, paragraph a,    Code 2023, is amended to read as follows:    a. A merger may be abandoned upon any of the following:    (1) The members of each of the constituent domestic    cooperatives entitled to vote on the approval of the plan    have approved the abandonment at a meeting by the affirmative    vote of the holders of a majority of the voting power of the    membership interests entitled to vote.    (2)   The merger is with a domestic cooperative and an Iowa    limited liability company or foreign business entity.                            

  House File 655, p. 142   (3)   (2) The abandonment is approved in such manner as may    be required by section 489.1015 for the involvement of an Iowa    limited liability company, or for   a foreign business entity by    under   the laws of the state under which the foreign business    entity is organized.    (4)   (3) The members of a constituent domestic cooperative    are not entitled to vote on the approval of the plan, and the    board of the constituent domestic cooperative has approved    the abandonment by the affirmative vote of a majority of the    directors present.    (5)   (4) The plan provides for abandonment and all    conditions for abandonment set forth in the plan are met.    (6) (5) The plan is abandoned before the effective date    of the plan by a resolution of the board of any constituent    domestic cooperative abandoning the plan of merger approved by    the affirmative vote of a majority of the directors present,    subject to the contract rights of any other person under the    plan. If a plan of merger is with a domestic business entity or    foreign business entity, the plan of merger may be abandoned    before the effective date of the plan by a resolution of the    foreign business entity adopted according to the laws of the    state under which the foreign business entity is organized,    subject to the contract rights of any other person under the    plan. If the plan of merger is with an Iowa limited liability      company, the plan of merger may be abandoned by the Iowa    limited liability company as provided in section 489.1015 ,    subject to the contractual rights of any other person under the    plan.    Sec. 156. Section 504.401, subsection 2, paragraph b,    subparagraph (4), Code 2023, is amended to read as follows:    (4) For a limited liability company under chapter 489 ,    section 489.108 , 489.109 , 489.114A,   or 489.706 .      Sec. 157. Section 504.403, subsection 1, paragraph b,    subparagraph (4), Code 2023, is amended to read as follows:    (4) For a limited liability company under chapter 489 ,    section 489.108 , 489.109 , 489.114A,   or 489.706 .    Sec. 158. Section 524.303, subsection 2, Code 2023, is      amended to read as follows:    2. Applicable fees, payable to the secretary of state as                         

  House File 655, p. 143   specified in section 489.117 or   section 490.122 , for the filing    of the articles of incorporation or section 489.117 for filing    a certificate of organization   .    Sec. 159. Section 524.310, subsection 5, paragraph b, Code    2023, is amended to read as follows:    b. A corporate or company name reserved, registered, or    protected as provided in section 489.109 , 489.114A, 489.706,      490.402 , 490.403 , 504.402 , or 504.403 .    Sec. 160. Section 542.7, subsection 3, paragraph c,    subparagraph (2), Code 2023, is amended to read as follows:    (2) Notwithstanding chapter 489, article 11   subchapter XI ,    or any other provision of law to the contrary, a certified    public accounting firm organized as a professional limited    liability company under chapter 489, article 11   subchapter XI ,    may have nonlicensee members provided that the professional    limited liability company complies with the requirements of    this section .    DIVISION III    EFFECTIVE DATE    Sec. 161. EFFECTIVE DATE. This Act takes effect January 1,    2024.    ______________________________   PAT GRASSLEY   Speaker of the House   ______________________________   AMY SINCLAIR   President of the Senate   I hereby certify that this bill originated in the House and   is known as House File 655, Ninetieth General Assembly.   ______________________________   MEGHAN NELSON   Chief Clerk of the House   Approved _______________, 2023 ______________________________   KIM REYNOLDS   Governor