Bill Text: IA HF2290 | 2011-2012 | 84th General Assembly | Introduced
Bill Title: A bill for an act revising the Iowa nonprofit corporation Act. (Formerly HSB 559)
Spectrum: Committee Bill
Status: (Introduced - Dead) 2012-03-13 - Withdrawn. H.J. 526. [HF2290 Detail]
Download: Iowa-2011-HF2290-Introduced.html
House
File
2290
-
Introduced
HOUSE
FILE
2290
BY
COMMITTEE
ON
JUDICIARY
(SUCCESSOR
TO
HSB
559)
A
BILL
FOR
An
Act
revising
the
Iowa
nonprofit
corporation
Act.
1
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
2
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5460HV
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2290
Section
1.
Section
504.141,
subsection
3,
Code
2011,
is
1
amended
by
striking
the
subsection
and
inserting
in
lieu
2
thereof
the
following:
3
3.
“Board”
or
“board
of
directors”
means
the
group
of
4
individuals
responsible
for
management
of
the
activities
and
5
affairs
of
a
corporation,
regardless
of
the
name
used
to
refer
6
to
the
group.
“Board”
or
“board
of
directors”
includes
a
7
designated
body
to
the
extent
that
both
of
the
following
are
8
applicable:
9
a.
The
powers,
functions,
or
authority
of
the
board
have
10
been
vested
in,
or
are
exercised
by,
the
designated
body.
11
b.
The
provisions
of
this
chapter
in
which
the
term
“board”
12
or
“board
of
directors”
is
used
are
relevant
to
the
discharge
13
by
the
designated
body
of
the
body’s
powers,
functions,
or
14
authority.
15
Sec.
2.
Section
504.141,
Code
2011,
is
amended
by
adding
the
16
following
new
subsections:
17
NEW
SUBSECTION
.
8A.
“Designated
body”
means
a
person
or
18
group,
other
than
a
committee
of
the
board
of
directors,
that
19
has
been
vested
by
the
articles
of
incorporation
or
bylaws
20
with
powers
that,
if
not
vested
by
the
articles
or
bylaws
in
21
that
person
or
group,
would
be
required
by
this
chapter
to
be
22
exercised
by
the
board
or
the
members.
23
NEW
SUBSECTION
.
11A.
“Domestic
unincorporated
entity”
means
24
an
unincorporated
entity
whose
internal
affairs
are
governed
by
25
the
laws
of
this
state.
26
NEW
SUBSECTION
.
17A.
“Foreign
unincorporated
entity”
means
27
an
unincorporated
entity
whose
internal
affairs
are
governed
by
28
an
organic
law
of
a
jurisdiction
other
than
this
state.
29
NEW
SUBSECTION
.
34A.
a.
“Unincorporated
entity”
means
an
30
organization
or
other
legal
entity
that
is
not
a
corporation
31
and
that
either
has
a
separate
legal
existence
or
has
the
power
32
to
acquire
an
estate
in
real
property
in
the
entity’s
own
name.
33
“Unincorporated
entity”
includes
a
general
partnership,
limited
34
liability
company,
limited
partnership,
business
or
statutory
35
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trust,
joint
stock
association,
and
unincorporated
nonprofit
1
association.
2
b.
“Unincorporated
entity”
does
not
include
a
domestic
3
or
foreign
business
corporation,
a
nonprofit
corporation,
an
4
estate,
a
trust,
a
governmental
subdivision,
a
state,
the
5
United
States,
or
a
foreign
government.
6
Sec.
3.
Section
504.141,
subsections
9,
15,
and
22,
Code
7
2011,
are
amended
to
read
as
follows:
8
9.
“Directors”
means
individuals,
designated
in
the
articles
9
or
bylaws
or
elected
by
the
incorporators,
and
their
successors
10
and
individuals
elected
or
appointed
by
any
other
name
or
title
11
to
act
as
members
of
the
board.
“Directors”
does
not
include
12
individuals
who
are
members
of
a
designated
body.
13
15.
“Entity”
includes
a
corporation
and
foreign
corporation;
14
business
corporation
and
domestic
or
foreign
business
15
corporation;
limited
liability
company
and
domestic
or
foreign
16
limited
liability
company;
profit
and
nonprofit
unincorporated
17
association;
corporation
sole
;
business
trust,
domestic
or
18
foreign
unincorporated
entity;
estate
,
partnership,
;
trust
,
19
and
two
or
more
persons
having
a
joint
or
common
economic
20
interest;
and
;
state
,
;
the
United
States
,
and
;
governmental
21
subdivision;
and
foreign
government.
22
22.
a.
“Member”
means
a
person
who
on
more
than
one
23
occasion,
pursuant
to
the
provisions
of
a
corporation’s
24
articles
or
bylaws,
has
a
right
to
vote
for
the
election
of
a
25
director
or
directors
of
a
corporation,
irrespective
of
how
a
26
member
is
defined
in
the
articles
or
bylaws
of
the
corporation.
27
A
person
is
not
a
member
because
of
any
of
the
following:
28
a.
(1)
The
person’s
rights
as
a
delegate.
29
b.
(2)
The
person’s
rights
to
designate
a
director.
30
c.
(3)
The
person’s
rights
as
a
director.
31
b.
“Member”
includes
a
designated
body
to
the
extent
that
32
all
of
the
following
are
applicable:
33
(1)
The
powers,
functions,
or
authority
of
the
member
have
34
been
vested
in,
or
are
exercised
by,
the
designated
body.
35
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(2)
The
provisions
of
this
chapter
in
which
the
term
1
“member”
is
used
are
relevant
to
the
discharge
by
the
designated
2
body
of
the
body’s
powers,
functions,
or
authority.
3
Sec.
4.
Section
504.622,
Code
2011,
is
amended
by
adding
the
4
following
new
subsection:
5
NEW
SUBSECTION
.
01.
A
membership
in
a
public
benefit
or
6
mutual
benefit
corporation
may
be
terminated
or
suspended
for
7
the
reasons
and
in
the
manner
provided
in
the
articles
of
8
incorporation
or
bylaws.
9
Sec.
5.
Section
504.622,
subsection
1,
Code
2011,
is
amended
10
to
read
as
follows:
11
1.
A
To
the
extent
the
articles
of
incorporation
or
bylaws
12
do
not
address
the
termination
or
suspension
of
a
member,
a
13
member
of
a
public
benefit
or
mutual
benefit
corporation
shall
14
not
be
expelled
or
suspended,
and
a
membership
or
memberships
15
in
such
a
corporation
shall
not
be
terminated
or
suspended
16
except
pursuant
to
a
procedure
which
is
fair
and
reasonable
and
17
is
carried
out
in
good
faith.
18
Sec.
6.
Section
504.701,
Code
2011,
is
amended
by
adding
the
19
following
new
subsection:
20
NEW
SUBSECTION
.
7.
The
articles
of
incorporation
or
21
bylaws
may
provide
that
an
annual
or
regular
meeting
of
22
members
is
not
required
to
be
held
at
a
geographic
location
23
if
the
meeting
is
held
by
means
of
the
internet
or
other
24
electronic
communications
technology
in
a
manner
pursuant
to
25
which
the
members
have
the
opportunity
to
read
or
hear
the
26
proceedings
substantially
concurrent
with
the
occurrence
of
the
27
proceedings,
vote
on
matters
submitted
to
the
members,
pose
28
questions,
and
make
comments.
29
Sec.
7.
Section
504.702,
Code
2011,
is
amended
by
adding
the
30
following
new
subsection:
31
NEW
SUBSECTION
.
6.
The
articles
of
incorporation
or
bylaws
32
may
provide
that
a
special
meeting
of
members
is
not
required
33
to
be
held
at
a
geographic
location
if
the
meeting
is
held
34
by
means
of
the
internet
or
other
electronic
communications
35
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technology
in
a
manner
pursuant
to
which
the
members
have
the
1
opportunity
to
read
or
hear
the
proceedings
substantially
2
concurrent
with
the
occurrence
of
the
proceedings,
vote
on
3
matters
submitted
to
the
members,
pose
questions,
and
make
4
comments.
5
Sec.
8.
NEW
SECTION
.
504.709
Conduct
of
meetings.
6
1.
At
each
meeting
of
members,
an
individual
shall
preside
7
as
chair.
The
chair
shall
be
appointed
as
follows:
8
a.
As
provided
in
the
articles
of
incorporation
or
bylaws.
9
b.
In
the
absence
of
a
provision
in
the
articles
of
10
incorporation
or
bylaws,
by
the
board
of
directors.
11
c.
In
the
absence
of
both
a
provision
in
the
articles
of
12
incorporation
or
bylaws
and
an
appointment
of
the
chair
by
the
13
board,
by
the
members
at
the
meeting.
14
2.
Except
as
provided
in
the
articles
of
incorporation
or
15
bylaws,
the
chair
shall
determine
the
order
of
business
and
16
shall
have
the
authority
to
establish
rules
for
the
conduct
of
17
the
meeting.
18
3.
Any
rules
adopted
for,
and
the
conduct
of,
the
meeting
19
shall
be
fair
to
the
members.
20
4.
The
chair
of
the
meeting
shall
announce
at
the
meeting
21
when
the
polls
close
for
each
matter
voted
upon.
If
no
22
announcement
is
made,
the
polls
shall
be
deemed
to
have
closed
23
upon
the
final
adjournment
of
the
meeting.
After
the
polls
24
are
closed,
no
ballots,
proxies,
or
votes,
or
any
otherwise
25
permissible
revocations
or
changes
thereto
may
be
accepted.
26
Sec.
9.
NEW
SECTION
.
504.719
Inspectors
of
election.
27
1.
A
corporation
with
members
may
appoint
one
or
more
28
inspectors
to
act
at
a
meeting
of
members
and
to
make
a
report
29
in
the
form
of
a
record
of
the
inspectors’
determinations.
30
Each
inspector
shall
execute
the
duties
of
inspector
31
impartially
and
according
to
the
best
of
the
inspector’s
32
ability.
33
2.
The
inspectors
shall
do
all
of
the
following:
34
a.
Ascertain
the
number
of
members
and
their
voting
power.
35
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b.
Determine
the
members
present
at
the
meeting.
1
c.
Determine
the
validity
of
proxies
and
ballots.
2
d.
Count
all
votes.
3
e.
Determine
the
result
of
the
voting.
4
3.
An
inspector
may,
but
is
not
required
to,
be
a
director,
5
member
of
a
designated
body,
member,
officer,
or
employee
of
6
the
corporation.
A
person
who
is
a
candidate
for
an
office
7
to
be
filled
at
the
meeting
shall
not
be
an
inspector
at
that
8
meeting.
9
Sec.
10.
Section
504.801,
subsection
2,
Code
2011,
is
10
amended
to
read
as
follows:
11
2.
Except
as
otherwise
provided
in
this
chapter
or
12
subsection
3
section
504.813
,
all
corporate
powers
shall
be
13
exercised
by
or
under
the
authority
of,
and
the
affairs
of
the
14
corporation
managed
under
the
direction
of,
and
subject
to
the
15
oversight
of,
its
board
of
directors
.
16
Sec.
11.
Section
504.801,
subsection
3,
Code
2011,
is
17
amended
by
striking
the
subsection.
18
Sec.
12.
NEW
SECTION
.
504.813
Designated
body.
19
1.
Some,
but
not
all,
of
the
powers,
authority,
or
functions
20
of
the
board
of
directors
of
a
corporation
under
this
chapter
21
may
be
vested
by
the
articles
of
incorporation
or
bylaws
in
a
22
designated
body.
If
such
a
designated
body
is
created,
all
of
23
the
following
are
applicable:
24
a.
The
provisions
of
this
part
and
other
provisions
of
25
law
applicable
to
the
rights,
duties,
and
liabilities
of
the
26
board
of
directors
or
directors
individually
also
apply
to
27
the
designated
body
and
to
the
members
of
the
designated
body
28
individually.
The
provisions
of
this
part
and
other
provisions
29
of
law
applicable
to
meetings,
notice,
and
actions
of
the
board
30
of
directors
also
apply
to
the
designated
body
in
the
absence
31
of
an
applicable
rule
in
the
articles
of
incorporation,
bylaws,
32
or
internal
operating
rules
of
the
designated
body.
33
b.
To
the
extent
that
the
powers,
authority,
or
functions
of
34
the
board
of
directors
have
been
vested
in
the
designated
body,
35
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the
directors
are
relieved
from
their
duties
and
liabilities
1
with
respect
to
those
powers,
authority,
and
functions.
2
c.
A
provision
of
the
articles
of
incorporation
or
bylaws
3
regarding
the
indemnification
of
directors
or
limiting
the
4
liability
of
directors
adopted
pursuant
to
section
504.202,
5
subsection
2,
paragraphs
“d”
and
“e”
is
applicable
to
members
6
of
the
designated
body,
except
as
otherwise
provided
in
the
7
articles
of
incorporation
or
bylaws.
8
2.
Some,
but
not
all,
of
the
rights
or
obligations
of
the
9
members
of
a
corporation
under
this
chapter
may
be
vested
in
10
a
designated
body
by
the
articles
of
incorporation
or
bylaws.
11
If
such
a
designated
body
is
created,
all
of
the
following
are
12
applicable:
13
a.
The
provisions
of
this
part
and
other
provisions
of
14
law
applicable
to
the
rights
and
obligations
of
members
also
15
apply
to
the
designated
body
and
to
members
of
the
designated
16
body
individually.
The
provisions
of
this
part
and
other
17
provisions
of
law
applicable
to
meetings,
notice,
and
actions
18
of
members
also
apply
to
the
designated
body
in
the
absence
19
of
an
applicable
provision
in
the
articles
of
incorporation,
20
bylaws,
or
internal
operating
rules
of
the
designated
body.
21
b.
To
the
extent
the
rights
or
obligations
of
the
members
22
have
been
vested
in
the
designated
body,
the
members
are
23
relieved
from
responsibility
with
respect
to
those
rights
and
24
obligations.
25
3.
The
articles
of
incorporation
or
bylaws
may
prescribe
26
qualifications
for
members
of
a
designated
body.
Except
27
as
otherwise
provided
in
the
articles
of
incorporation
or
28
bylaws,
a
member
of
a
designated
body
is
not
required
to
be
an
29
individual;
a
director,
officer,
or
member
of
the
corporation;
30
or
a
resident
of
this
state.
31
Sec.
13.
Section
504.826,
Code
2011,
is
amended
by
adding
32
the
following
new
subsection:
33
NEW
SUBSECTION
.
7.
A
corporation
may
create
or
authorize
34
the
creation
of
one
or
more
advisory
committees
whose
members
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are
not
required
to
be
directors.
An
advisory
committee
is
not
1
a
committee
of
the
board
of
directors
and
shall
not
exercise
2
any
powers
of
the
board.
3
Sec.
14.
Section
504.831,
Code
2011,
is
amended
by
adding
4
the
following
new
subsection:
5
NEW
SUBSECTION
.
2A.
In
discharging
board
or
committee
6
duties,
a
director
must
disclose,
or
cause
to
be
disclosed,
to
7
the
other
board
or
committee
members,
information
not
already
8
known
by
them,
but
known
by
the
director
to
be
material
to
the
9
discharge
of
the
decision-making
or
oversight
functions
of
the
10
board
or
committee,
except
that
such
disclosure
is
not
required
11
to
the
extent
that
the
director
reasonably
believes
that
doing
12
so
would
violate
a
duty
imposed
by
law,
a
legally
enforceable
13
obligation
of
confidentiality,
or
a
professional
ethics
rule.
14
Sec.
15.
Section
504.831,
subsection
5,
paragraph
c,
Code
15
2011,
is
amended
to
read
as
follows:
16
c.
A
committee
of
the
board
or
advisory
committee
of
17
which
the
director
is
not
a
member,
as
to
matters
within
18
its
the
committee’s
or
advisory
committee’s
jurisdiction,
if
19
the
director
reasonably
believes
the
committee
or
advisory
20
committee
merits
confidence.
21
Sec.
16.
Section
504.834,
Code
2011,
is
amended
by
adding
22
the
following
new
subsection:
23
NEW
SUBSECTION
.
1A.
This
section
does
not
apply
to
any
of
24
the
following:
25
a.
An
advance
to
pay
reimbursable
expenses
reasonably
26
expected
to
be
incurred
by
a
director
or
officer.
27
b.
An
advance
to
pay
premiums
on
life
insurance
if
the
28
advance
is
secured
by
the
cash
value
of
the
policy.
29
c.
An
advance
made
pursuant
to
part
5
of
this
subchapter
30
VIII.
31
d.
Loans
or
advances
made
pursuant
to
employee
benefit
32
plans.
33
e.
A
loan
secured
by
the
principal
residence
of
an
officer.
34
f.
A
loan
to
pay
relocation
expenses
of
an
officer.
35
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Sec.
17.
NEW
SECTION
.
504.836
Business
opportunities.
1
1.
A
director’s
taking
advantage,
directly
or
indirectly,
2
of
a
business
opportunity
shall
not
be
the
subject
of
equitable
3
relief,
or
give
rise
to
an
award
of
damages
or
other
sanctions
4
against
the
director,
in
a
proceeding
by
or
in
the
right
of
a
5
corporation
on
the
ground
that
such
opportunity
should
have
6
first
been
offered
to
the
corporation,
if
before
becoming
7
legally
obligated
respecting
the
business
opportunity,
the
8
director
brings
the
opportunity
to
the
attention
of
the
9
corporation
and
action
is
taken
by
the
directors,
a
committee
10
of
the
directors,
or
the
members
disclaiming
the
corporation’s
11
interest
in
the
opportunity
in
compliance
with
the
procedures
12
set
forth
in
section
504.833,
as
if
the
decision
being
made
13
concerned
a
conflict
of
interest
transaction.
14
2.
In
any
proceeding
seeking
equitable
relief
or
other
15
remedy,
based
upon
an
alleged
improper
taking
advantage
of
a
16
business
opportunity
by
a
director,
the
fact
that
the
director
17
did
not
employ
the
procedure
described
in
subsection
1
before
18
taking
advantage
of
the
opportunity
shall
not
create
an
19
inference
that
the
opportunity
should
have
first
been
presented
20
to
the
corporation,
or
alter
the
burden
of
proof
otherwise
21
applicable
to
establish
that
the
director
breached
a
duty
to
22
the
corporation
under
the
circumstances.
23
3.
As
used
in
this
section,
“director”
includes
a
member
of
24
a
designated
body.
25
Sec.
18.
Section
504.843,
Code
2011,
is
amended
by
adding
26
the
following
new
subsection:
27
NEW
SUBSECTION
.
1A.
The
duties
of
an
officer
include
the
28
obligation
to
inform
the
specified
persons
of
the
following:
29
a.
The
superior
officer
to
whom
or
the
board
of
directors
30
or
the
committee
of
the
board
to
which
the
officer
reports,
of
31
information
about
the
affairs
of
the
corporation
known
to
the
32
officer,
within
the
scope
of
the
officer’s
functions,
and
known
33
to
the
officer
to
be
material
to
the
superior
officer,
board,
34
or
committee.
35
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b.
The
officer’s
superior
officer,
or
another
appropriate
1
person
within
the
corporation,
or
the
board
of
directors,
or
2
a
committee
of
the
board,
of
any
actual
or
probable
material
3
violation
of
law
involving
the
corporation
or
any
material
4
breach
of
duty
to
the
corporation
by
an
officer,
employee,
5
or
agent
of
the
corporation,
that
the
officer
believes
has
6
occurred
or
is
likely
to
occur.
7
Sec.
19.
Section
504.1101,
subsection
1,
Code
2011,
is
8
amended
to
read
as
follows:
9
1.
Subject
to
the
limitations
set
forth
in
section
504.1102
,
10
one
or
more
nonprofit
corporations
may
merge
with
or
into
any
11
one
or
more
business
corporations
or
nonprofit
corporations
or
12
limited
liability
companies
unincorporated
entities
,
if
the
13
plan
of
merger
is
approved
as
provided
in
section
504.1103
.
14
Sec.
20.
Section
504.1101,
subsection
2,
paragraphs
a,
c,
15
and
d,
Code
2011,
are
amended
to
read
as
follows:
16
a.
The
name
of
each
corporation
or
limited
liability
company
17
unincorporated
entity
planning
to
merge
and
the
name
of
the
18
surviving
corporation
into
which
each
plans
to
merge.
19
c.
The
manner
and
basis,
if
any,
of
converting
the
20
memberships
of
each
public
benefit
or
religious
corporation
21
into
memberships
of
the
surviving
corporation
or
limited
22
liability
company
unincorporated
entity
.
23
d.
If
the
merger
involves
a
mutual
benefit
corporation,
24
the
manner
and
basis,
if
any,
of
converting
memberships
of
25
each
merging
corporation
into
memberships,
obligations,
or
26
securities
of
the
surviving
or
any
other
corporation
or
limited
27
liability
company
unincorporated
entity
or
into
cash
or
other
28
property
in
whole
or
in
part.
29
Sec.
21.
Section
504.1101,
subsection
3,
paragraph
a,
Code
30
2011,
is
amended
to
read
as
follows:
31
a.
Any
amendments
to
the
articles
of
incorporation
or
bylaws
32
of
the
surviving
corporation
or
limited
liability
company
33
unincorporated
entity
to
be
effected
by
the
planned
merger.
34
Sec.
22.
Section
504.1102,
subsection
1,
paragraphs
a
and
b,
35
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2290
Code
2011,
are
amended
to
read
as
follows:
1
a.
A
public
benefit
or
religious
corporation
,
or
a
2
domestic
unincorporated
entity
which,
if
incorporated,
would
3
qualify
under
this
chapter
as
a
public
benefit
or
religious
4
corporation
.
5
b.
A
foreign
corporation
which
would
qualify
under
this
6
chapter
as
a
public
benefit
or
religious
corporation
,
or
a
7
foreign
unincorporated
entity
which,
if
incorporated,
would
8
qualify
under
this
chapter
as
a
public
benefit
or
religious
9
corporation
.
10
Sec.
23.
Section
504.1102,
subsection
1,
paragraph
d,
11
unnumbered
paragraph
1,
Code
2011,
is
amended
to
read
as
12
follows:
13
A
business
or
mutual
benefit
corporation
,
or
limited
14
liability
company
an
unincorporated
entity
which,
if
15
incorporated,
would
not
qualify
as
a
public
benefit
or
16
religious
corporation
,
provided
that
all
of
the
following
apply
17
where
the
public
benefit
or
religious
corporation
is
not
the
18
surviving
entity
in
the
merger
:
19
Sec.
24.
Section
504.1102,
subsection
1,
paragraph
d,
20
subparagraphs
(2)
and
(3),
Code
2011,
are
amended
to
read
as
21
follows:
22
(2)
The
business
or
mutual
benefit
corporation
or
limited
23
liability
company
unincorporated
entity
which,
if
incorporated,
24
would
not
qualify
as
a
public
benefit
or
religious
corporation,
25
shall
return,
transfer,
or
convey
any
assets
held
by
it
upon
26
condition
requiring
return,
transfer,
or
conveyance,
which
27
condition
occurs
by
reason
of
the
merger,
in
accordance
with
28
such
condition.
29
(3)
The
merger
is
approved
by
a
majority
of
directors
of
30
the
public
benefit
or
religious
corporation
or
managers
of
31
an
unincorporated
entity
which,
if
incorporated,
would
not
32
qualify
as
a
public
benefit
or
religious
corporation,
who
are
33
not
and
will
not
become
members
or
shareholders
in
or
officers,
34
employees,
agents,
or
consultants
of
the
surviving
entity.
35
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2290
Sec.
25.
Section
504.1106,
subsection
1,
Code
2011,
is
1
amended
to
read
as
follows:
2
1.
Except
as
provided
in
section
504.1102
,
one
or
more
3
foreign
business
or
nonprofit
corporations
or
foreign
4
unincorporated
entities
may
merge
with
one
or
more
domestic
5
nonprofit
corporations
if
all
of
the
following
conditions
are
6
met:
7
a.
The
merger
is
permitted
by
the
law
of
the
state
or
8
country
under
whose
law
each
foreign
corporation
or
foreign
9
unincorporated
entity
is
incorporated
and
each
foreign
10
corporation
or
foreign
unincorporated
entity
complies
with
that
11
law
in
effecting
the
merger.
12
b.
The
foreign
corporation
or
foreign
unincorporated
13
entity
complies
with
section
504.1104
if
it
is
the
surviving
14
corporation
of
the
merger.
15
c.
Each
domestic
nonprofit
corporation
complies
with
the
16
applicable
provisions
of
sections
504.1101
through
504.1103
17
and,
if
it
is
the
surviving
corporation
of
the
merger,
with
18
section
504.1104
.
19
Sec.
26.
Section
504.1106,
subsection
2,
Code
2011,
is
20
amended
to
read
as
follows:
21
2.
Upon
the
merger
taking
effect,
the
surviving
foreign
22
business
or
nonprofit
corporation
,
or
foreign
unincorporated
23
entity,
is
deemed
to
have
irrevocably
appointed
the
secretary
24
of
state
as
its
agent
for
service
of
process
in
any
proceeding
25
brought
against
it.
26
EXPLANATION
27
This
bill
makes
various
revisions
to
the
Iowa
nonprofit
28
corporation
Act.
29
Code
section
504.141
is
amended
to
add
a
definition
of
a
30
“designated
body”
which
is
a
person
or
group
other
than
a
31
committee
of
the
board
of
directors
that
is
vested
by
the
32
articles
of
incorporation
or
bylaws
of
a
nonprofit
corporation
33
with
powers
otherwise
required
to
be
exercised
by
the
corporate
34
board
of
directors
or
the
members.
Other
definitions
are
35
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2290
modified
to
include
a
designated
body
within
the
meaning
of
the
1
“board
of
directors”
or
as
a
“member”
of
the
corporation
and
to
2
exclude
individuals
who
are
members
of
a
designated
body
from
3
the
definition
of
a
“director”.
4
Code
section
504.141
is
also
amended
to
provide
that
an
5
“entity”
includes
an
“unincorporated
entity”
and
to
include
6
a
definition
of
an
“unincorporated
entity”
which
is
an
7
organization
or
other
legal
entity
that
is
not
a
corporation
8
and
that
either
has
a
separate
legal
existence
or
has
the
9
power
to
acquire
an
estate
in
real
property
in
the
entity’s
10
own
name.
An
“unincorporated
entity”
includes
specified
11
types
of
legal
entities
that
are
not
corporations.
An
12
“unincorporated
entity”
also
does
not
include
an
estate,
a
13
trust,
a
governmental
subdivision,
a
state,
the
United
States,
14
or
a
foreign
government.
There
are
also
definitions
for
a
15
“domestic
unincorporated
entity”
whose
affairs
are
governed
16
by
Iowa
law
and
for
a
“foreign
unincorporated
entity”
whose
17
affairs
are
governed
by
the
law
of
another
jurisdiction.
18
Code
section
504.622
is
amended
to
provide
that
membership
19
in
a
public
benefit
or
mutual
benefit
corporation
may
be
20
terminated
or
suspended
as
provided
in
the
articles
of
21
incorporation
or
bylaws
and
to
the
extent
that
those
items
do
22
not
address
such
a
termination
or
suspension,
the
procedure
23
must
be
carried
out
in
good
faith
in
a
manner
which
is
fair
and
24
reasonable.
25
Code
sections
504.701
and
504.702
are
amended
to
allow
a
26
nonprofit
corporation
with
members
to
hold
an
annual
or
regular
27
meeting
or
a
special
meeting
by
means
of
the
internet
or
other
28
electronic
communications
technology
so
long
as
members
have
29
the
opportunity
to
read
or
hear
the
proceedings
substantially
30
concurrent
with
the
occurrence
of
the
proceedings
and
can
vote,
31
pose
questions,
and
make
comments.
32
New
Code
section
504.709
requires
that
an
individual
preside
33
as
chair
at
each
meeting
of
corporate
members
as
provided
in
34
the
articles
of
incorporation
or
bylaws,
as
appointed
by
the
35
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board,
or
as
appointed
by
members
at
the
meeting.
Unless
1
otherwise
provided
by
the
articles
or
bylaws,
the
chair
shall
2
determine
the
order
of
business
and
establish
rules
for
the
3
conduct
of
the
meeting.
4
New
Code
section
504.719
allows
a
nonprofit
corporation
with
5
members
to
appoint
one
or
more
inspectors
to
assist
with
voting
6
at
the
meeting
and
make
a
report
of
their
determinations
and
7
the
results
of
the
vote.
8
Code
section
504.801
is
amended
to
provide
that,
with
the
9
exception
of
corporate
powers
that
are
vested
in
a
designated
10
body,
all
such
powers
shall
be
exercised
by
or
under
the
11
authority
of,
and
the
affairs
of
the
corporation
shall
be
12
managed
under
the
direction
and
subject
to
the
oversight
of,
13
the
board
of
directors.
14
New
Code
section
504.813
allows
some,
but
not
all,
of
the
15
powers,
authority,
or
functions
of
the
board
of
directors,
16
or
of
the
rights
or
obligations
of
members,
of
a
nonprofit
17
corporation
to
be
vested
by
the
articles
of
incorporation
or
18
bylaws
in
a
designated
body.
If
such
a
designated
body
is
19
created,
provisions
of
law
applicable
to
the
powers,
authority,
20
functions,
rights,
or
obligations
of
the
board
of
directors,
21
the
directors
individually,
or
the
members
apply
to
the
22
designated
body
and
its
members
individually
and
the
directors
23
or
members
are
relieved
of
their
duties
and
liabilities
with
24
respect
to
those
matters
vested
in
the
designated
body.
25
Code
section
504.826
is
amended
to
provide
that
a
nonprofit
26
corporation
can
create
or
authorize
the
creation
of
one
or
27
more
advisory
committees
whose
members
are
not
required
to
be
28
directors
of
the
corporation.
Such
an
advisory
committee
is
29
not
a
committee
of
the
board
and
cannot
exercise
any
powers
of
30
the
board.
31
Code
section
504.831
is
amended
to
provide
that
in
32
discharging
board
or
committee
duties
a
corporate
director
33
must
disclose
information
to
the
other
board
or
committee
34
members
that
is
not
known
to
them
but
known
by
the
director
to
35
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2290
be
material
to
their
decision-making
or
oversight
functions,
1
except
when
such
disclosure
would
violate
a
legal
duty,
2
a
legally
enforceable
obligation
of
confidentiality,
or
a
3
professional
ethics
rule.
4
Code
section
504.831
is
also
amended
to
allow
a
director
to
5
rely
on
a
committee
of
the
board
or
an
advisory
committee
of
6
which
the
director
is
not
a
member
as
to
matters
within
the
7
committee
or
advisory
committee’s
jurisdiction,
if
the
director
8
reasonably
believes
the
committee
or
advisory
committee
merits
9
confidence.
10
Code
section
504.834
is
amended
to
provide
that
the
11
prohibition
of
that
Code
section
against
lending
money
to
or
12
guaranteeing
the
obligation
of
a
director
or
officer
of
the
13
corporation
does
not
apply
to
certain
specified
advances
and
14
loans.
15
New
Code
section
504.836
provides
that
a
director’s
taking
16
advantage,
directly
or
indirectly,
of
a
business
opportunity
17
cannot
be
the
subject
of
equitable
relief
or
give
rise
to
an
18
award
of
damages
or
other
sanctions
against
the
director,
in
19
a
proceeding
by
or
in
the
right
of
a
nonprofit
corporation
on
20
the
ground
that
the
business
opportunity
should
have
first
21
been
offered
to
the
corporation
if
before
becoming
legally
22
obligated
on
the
business
opportunity,
the
director
brings
the
23
opportunity
to
the
attention
of
the
corporation
and
action
24
is
taken
by
the
directors,
a
committee
of
the
directors,
or
25
the
members
disclaiming
the
corporation’s
interest
in
the
26
opportunity.
This
disclaimer
must
be
made
in
compliance
with
27
procedures
set
forth
in
Code
section
504.833
for
conflict
of
28
interest
transactions
by
directors.
However,
in
an
action
29
seeking
equitable
relief
or
other
remedy
based
upon
an
alleged
30
improper
taking
advantage
of
such
a
business
opportunity
by
a
31
director,
the
fact
that
the
above
procedure
was
not
complied
32
with
does
not
create
an
inference
that
the
opportunity
should
33
have
been
presented
to
the
corporation
or
alter
the
burden
34
of
proof
necessary
to
establish
a
breach
of
duty
to
the
35
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corporation
by
the
director.
1
Code
section
504.843
is
amended
to
provide
that
a
corporate
2
officer
has
the
duty
to
provide
information
to
specified
3
persons
within
the
corporation
about
the
affairs
of
the
4
corporation
known
to
the
officer
to
be
material
and
about
any
5
actual
or
probable
material
violation
of
law
involving
the
6
corporation
or
any
material
breach
of
duty
to
the
corporation
7
by
an
officer,
employee,
or
agent
of
the
corporation.
8
Code
section
504.1101
which
applies
to
mergers
of
nonprofit
9
corporations
with
other
entities,
is
amended
to
substitute
10
the
newly
defined
term
“unincorporated
entity”
for
“limited
11
liability
company”.
A
limited
liability
company
is
now
12
encompassed
within
the
definition
of
an
“unincorporated
13
entity”,
which
includes
other
types
of
entities
as
well.
14
Code
section
504.1102,
which
allows
certain
mergers
by
15
public
benefit
or
religious
corporations
without
prior
16
approval
of
the
district
court,
is
amended
to
also
apply
to
a
17
newly
defined
“domestic
unincorporated
entity”
and
“foreign
18
unincorporated
entity”
which,
if
incorporated,
would
qualify
19
as
a
public
benefit
or
religious
corporation,
and
to
an
20
“unincorporated
entity”,
which
if
incorporated,
would
not
21
qualify
as
a
public
benefit
or
religious
corporation,
but
meets
22
other
specifications.
23
Code
section
504.1102
is
also
amended
to
provide
that
when
24
a
merger
of
a
public
benefit
or
religious
corporation
with
25
a
business
or
mutual
benefit
corporation
or
unincorporated
26
entity,
which
if
incorporated
would
not
qualify
as
a
public
27
benefit
or
religious
corporation,
will
result
in
the
public
28
benefit
or
religious
corporation
not
surviving,
certain
29
conditions
must
be
met.
30
Code
section
504.1106
is
amended
to
allow
mergers
between
a
31
newly
defined
“foreign
unincorporated
entity”
and
a
domestic
32
nonprofit
corporation
under
specified
conditions.
33
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