Bill Text: IA SF2347 | 2023-2024 | 90th General Assembly | Introduced
Bill Title: A bill for an act providing for limited liability companies, providing for fees, and including effective date provisions.(Formerly SSB 3147.)
Spectrum: Committee Bill
Status: (Introduced) 2024-02-20 - Subcommittee: Bousselot, Klimesh, and Quirmbach. S.J. 355. [SF2347 Detail]
Download: Iowa-2023-SF2347-Introduced.html
Senate
File
2347
-
Introduced
SENATE
FILE
2347
BY
COMMITTEE
ON
JUDICIARY
(SUCCESSOR
TO
SSB
3147)
A
BILL
FOR
An
Act
providing
for
limited
liability
companies,
providing
for
1
fees,
and
including
effective
date
provisions.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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Section
1.
Section
489.102,
subsection
13,
Code
2024,
is
1
amended
to
read
as
follows:
2
13.
“Limited
liability
company”
,
except
in
the
phrase
3
“foreign
limited
liability
company”
,
and
in
subchapter
X
means
4
an
entity
formed
under
this
chapter
or
which
becomes
subject
to
5
this
chapter
under
subchapter
X
or
section
489.110
489.1207
.
6
Sec.
2.
Section
489.103,
subsection
4,
paragraph
b,
7
subparagraph
(3),
Code
2024,
is
amended
to
read
as
follows:
8
(3)
The
limited
liability
company’s
participation
in
a
9
merger,
interest
exchange,
conversion,
or
domestication,
10
ninety
days
after
articles
the
statement
of
merger,
interest
11
exchange,
conversion,
or
domestication
under
subchapter
X
12
become
effective.
13
Sec.
3.
Section
489.109,
subsection
2,
paragraph
a,
Code
14
2024,
is
amended
to
read
as
follows:
15
a.
Delivering
to
the
secretary
of
state
for
filing
a
16
statement
of
change
under
section
489.116
,
an
amendment
to
the
17
certificate
under
section
489.202
,
a
statement
of
correction
18
under
section
489.209
,
a
biennial
report
under
section
489.211A
19
489.212
,
a
statement
of
withdrawal
or
a
statement
of
rescission
20
under
section
489.703
,
or
a
statement
of
termination
under
21
section
489.702,
subsection
2
,
paragraph
“b”
,
subparagraph
(6).
22
Sec.
4.
Section
489.116,
subsection
2,
paragraph
b,
Code
23
2024,
is
amended
to
read
as
follows:
24
b.
A
similar
filing
changing
the
registered
agent
or
25
registered
office
address
of
the
registered
agent
,
if
any,
of
26
the
limited
liability
company
in
any
other
jurisdiction.
27
Sec.
5.
Section
489.119,
subsection
2,
unnumbered
paragraph
28
1,
Code
2024,
is
amended
to
read
as
follows:
29
If
a
limited
liability
company
or
registered
foreign
limited
30
liability
company
ceases
to
have
a
registered
agent,
or
if
its
31
registered
agent
cannot
with
reasonable
diligence
be
served,
32
the
limited
liability
company
or
registered
foreign
limited
33
liability
company
may
be
served
by
registered
or
certified
34
mail,
return
receipt
requested,
or
by
similar
commercial
35
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delivery
service,
addressed
to
the
limited
liability
company
or
1
registered
foreign
limited
liability
company
at
its
principal
2
office.
The
address
of
the
principal
office
must
be
as
shown
3
on
the
limited
liability
company’s
or
registered
foreign
4
limited
liability
company’s
most
recent
biennial
report
filed
5
with
the
secretary
of
state
pursuant
to
section
489.211A
6
489.212
.
Service
is
effected
under
this
subsection
on
the
7
earliest
of
any
of
the
following:
8
Sec.
6.
Section
489.122,
subsection
1,
paragraphs
b,
g,
l,
9
and
s,
Code
2024,
are
amended
to
read
as
follows:
10
b.
Statement
of
withdrawal
under
section
489.208,
subsection
11
1
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
No
fee
12
g.
Statement
of
change
of
registered
agent
or
address
of
the
13
registered
office
agent
or
both
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
No
fee
14
l.
Articles
Statement
of
merger
or
interest
exchange
.
$
50
15
s.
Statement
of
cancellation
withdrawal
under
section
16
489.907
or
section
489.909,
subsection
1
.
.
.
.
.
.
.
.
.
.
.
.
.
$
10
17
Sec.
7.
Section
489.122,
subsection
1,
Code
2024,
is
amended
18
by
adding
the
following
new
paragraphs:
19
NEW
PARAGRAPH
.
0m.
Statement
of
domestication
.
.
.
$
50
20
NEW
PARAGRAPH
.
00m.
Statement
of
conversion
.
.
.
.
.
$
50
21
Sec.
8.
Section
489.122,
subsection
4,
Code
2024,
is
amended
22
to
read
as
follows:
23
4.
The
secretary
of
state
may
impose,
assess,
and
collect
24
a
filing
fee
as
a
condition
to
accepting
a
biennial
report
as
25
provided
in
section
489.211A
489.212
.
26
Sec.
9.
Section
489.206,
subsection
6,
paragraph
f,
Code
27
2024,
is
amended
to
read
as
follows:
28
f.
The
biennial
report
required
by
section
489.211A
489.212
.
29
Sec.
10.
Section
489.211,
subsection
2,
paragraph
e,
Code
30
2024,
is
amended
to
read
as
follows:
31
e.
That
the
most
recent
biennial
report
required
by
section
32
489.211A
489.212
has
been
delivered
to
the
secretary
of
state
33
for
filing.
34
Sec.
11.
Section
489.211A,
subsection
1,
paragraphs
b
and
d,
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Code
2024,
are
amended
to
read
as
follows:
1
b.
The
name
of
the
registered
agent
and
street
address
of
2
the
company’s
registered
office,
the
name
of
its
registered
3
agent
at
that
office
,
and
the
consent
of
any
new
registered
4
agent.
5
d.
In
the
case
of
a
foreign
limited
liability
company,
the
6
state
or
other
jurisdiction
under
whose
law
the
foreign
company
7
is
formed
and
any
alternate
name
adopted
under
section
489.805
8
489.906
,
subsection
1.
9
Sec.
12.
Section
489.211A,
subsection
5,
Code
2024,
is
10
amended
to
read
as
follows:
11
5.
The
secretary
of
state
may
provide
for
the
change
12
of
registered
office
agent
or
address
of
the
registered
13
agent
on
the
form
prescribed
by
the
secretary
of
state
for
14
the
biennial
report,
provided
that
the
form
contains
the
15
information
required
in
section
489.116
.
If
the
secretary
of
16
state
determines
that
a
biennial
report
does
not
contain
the
17
information
required
in
this
section
but
otherwise
meets
the
18
requirements
of
section
489.116
for
the
purpose
of
changing
the
19
registered
office
or
registered
agent,
the
secretary
of
state
20
shall
file
the
statement
of
change
for
the
registered
office
21
agent
or
address
of
the
registered
agent,
effective
as
provided
22
in
section
489.207,
subsection
3
,
before
returning
the
biennial
23
report
to
the
limited
liability
company
as
provided
in
this
24
section
.
A
statement
of
change
of
registered
office
agent
or
25
address
of
the
registered
agent
accomplished
pursuant
to
this
26
subsection
shall
be
executed
by
a
person
authorized
to
execute
27
the
biennial
report.
28
Sec.
13.
Section
489.302,
subsection
10,
Code
2024,
is
29
amended
to
read
as
follows:
30
10.
A
statement
of
authority
filed
by
the
secretary
of
state
31
under
section
489.207
489.206
,
subsection
1,
is
effective
until
32
amended
or
canceled
as
provided
in
subsection
2
,
unless
an
33
earlier
cancellation
date
is
specified
in
the
statement.
34
Sec.
14.
Section
489.708,
subsections
2
and
4,
Code
2024,
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are
amended
to
read
as
follows:
1
2.
The
limited
liability
company
does
not
deliver
its
2
biennial
report
required
by
section
489.211A
489.212
to
the
3
secretary
of
state
within
sixty
days
after
it
is
due.
4
4.
The
secretary
of
state
has
not
been
notified
within
sixty
5
days
that
the
limited
liability
company’s
registered
agent
or
6
place
of
business
of
the
registered
agent
has
been
changed,
or
7
that
its
registered
agent
has
resigned,
or
that
its
the
address
8
of
the
registered
office
agent
has
been
discontinued.
9
Sec.
15.
Section
489.710,
subsection
1,
unnumbered
10
paragraph
1,
Code
2024,
is
amended
to
read
as
follows:
11
A
limited
liability
company
administratively
dissolved
under
12
section
489.708
489.709
may
apply
to
the
secretary
of
state
13
for
reinstatement
at
any
time
after
the
effective
date
of
14
dissolution.
The
application
must
meet
all
of
the
following
15
requirements:
16
Sec.
16.
Section
489.711,
subsection
2,
Code
2024,
is
17
amended
to
read
as
follows:
18
2.
The
limited
liability
company
may
appeal
the
denial
of
19
reinstatement
to
the
district
court
of
the
county
where
the
20
company’s
principal
office
or,
if
none
in
this
state,
where
its
21
registered
office
agent
is
located
within
thirty
days
after
22
service
of
the
notice
of
denial
is
effected.
The
company
23
appeals
by
petitioning
the
court
to
set
aside
the
dissolution
24
and
attaching
to
the
petition
copies
of
the
secretary
of
25
state’s
certificate
of
dissolution,
the
company’s
application
26
for
reinstatement,
and
the
secretary
of
state’s
notice
of
27
denial.
28
Sec.
17.
Section
489.804,
Code
2024,
is
amended
to
read
as
29
follows:
30
489.804
Pleading.
31
In
a
derivative
action
under
section
489.802
,
the
complaint
32
must
state
with
particularity
any
of
the
following:
33
1.
The
the
date
and
content
of
the
plaintiff’s
demand
and
34
the
response
to
the
demand
by
the
managers
or
other
members.
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2.
Why
demand
should
be
excused
as
futile.
1
Sec.
18.
Section
489.911,
subsection
1,
paragraph
d,
Code
2
2024,
is
amended
to
read
as
follows:
3
d.
The
secretary
of
state
has
not
been
notified
within
4
sixty
days
that
the
foreign
limited
liability
company’s
5
registered
agent
or
the
registered
agent’s
place
of
business
6
has
been
changed,
that
its
registered
agent
has
resigned,
or
7
that
its
the
address
of
the
registered
office
agent
has
been
8
discontinued.
9
Sec.
19.
Section
489.1005,
subsection
2,
paragraph
b,
Code
10
2024,
is
amended
to
read
as
follows:
11
b.
The
address
of
the
registered
office
agent
of
any
entity.
12
Sec.
20.
Section
489.1207,
subsection
2,
Code
2024,
is
13
amended
to
read
as
follows:
14
2.
A
limited
liability
company
that
has
published
notice
of
15
its
dissolution
and
requested
persons
having
claims
against
the
16
limited
liability
company
to
present
them
in
accordance
with
17
the
notice
pursuant
to
section
489.704
489.705
as
that
section
18
existed
immediately
prior
to
January
1,
2024,
shall
be
subject
19
to
the
requirements
set
forth
in
that
section
as
it
existed
20
immediately
prior
to
January
1,
2024,
including
the
right
of
21
a
claim
by
a
person
that
is
commenced
within
five
years
after
22
publication
of
the
notice.
23
Sec.
21.
Section
489.1036,
subsection
1,
paragraph
a,
Code
24
2024,
is
amended
to
read
as
follows:
25
a.
The
interests
in
the
acquired
limited
liability
company
26
which
are
the
subject
of
the
interest
exchange
are
converted,
27
and
the
members
holding
those
interests
are
entitled
only
to
28
the
rights
provided
to
them
under
the
plan
of
interest
exchange
29
and
to
any
appraisal
rights
they
have
under
section
486.1006
30
489.1006
.
31
Sec.
22.
Section
489.14201,
subsections
3
and
4,
Code
2024,
32
are
amended
to
read
as
follows:
33
3.
A
protected
series
is
established
when
the
protected
34
series
designation
takes
effect
under
section
489.205
489.207
.
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4.
To
amend
a
protected
series
designation,
a
series
limited
1
liability
company
shall
deliver
to
the
secretary
of
state
2
for
filing
a
statement
of
designation
change,
signed
by
the
3
company,
that
changes
the
name
of
the
company,
the
name
of
the
4
protected
series
to
which
the
designation
applies,
or
both.
5
The
change
takes
effect
when
the
statement
of
designation
6
change
takes
effect
under
section
489.205
489.207
.
7
Sec.
23.
Section
489.14205,
subsection
1,
paragraph
a,
8
subparagraph
(2),
unnumbered
paragraph
1,
Code
2024,
is
amended
9
to
read
as
follows:
10
The
company
has
delivered
to
the
secretary
of
state
for
11
filing
the
most
recent
biennial
report
required
by
section
12
489.211A
489.212
and
the
report
includes
the
name
of
the
13
protected
series,
unless
any
of
the
following
applies:
14
Sec.
24.
Section
489.14206,
subsection
1,
unnumbered
15
paragraph
1,
Code
2024,
is
amended
to
read
as
follows:
16
In
the
biennial
report
required
by
section
489.211A
489.212
,
17
a
series
limited
liability
company
shall
include
the
name
of
18
each
protected
series
of
the
company
for
which
all
of
the
19
following
apply:
20
Sec.
25.
Section
489.14604,
unnumbered
paragraph
1,
Code
21
2024,
is
amended
to
read
as
follows:
22
A
series
limited
liability
company
may
be
party
to
a
merger
23
in
accordance
with
sections
489.1001
through
489.1005
24
subchapter
X,
parts
1
and
2
,
this
section
,
and
sections
25
489.14605
through
489.14608
only
if
all
of
the
following
apply:
26
Sec.
26.
Section
489.14605,
subsection
1,
Code
2024,
is
27
amended
to
read
as
follows:
28
1.
Comply
with
section
489.1002
subchapter
X,
parts
1
and
2
.
29
Sec.
27.
Section
489.14606,
unnumbered
paragraph
1,
Code
30
2024,
is
amended
to
read
as
follows:
31
In
a
merger
under
section
489.14604
,
the
articles
statement
32
of
merger
must
do
all
of
the
following:
33
Sec.
28.
Section
489.14606,
subsection
1,
Code
2024,
is
34
amended
to
read
as
follows:
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1.
Comply
with
section
489.1004
subchapter
X,
parts
1
and
2
.
1
Sec.
29.
Section
489.14607,
unnumbered
paragraph
1,
Code
2
2024,
is
amended
to
read
as
follows:
3
When
a
merger
under
section
489.14604
becomes
effective,
in
4
addition
to
the
effects
stated
in
section
489.1005
489.1026
,
5
all
of
the
following
apply:
6
Sec.
30.
CODE
EDITOR
DIRECTIVE.
7
1.
The
Code
editor
is
directed
to
make
the
following
8
transfer:
9
Section
489.211A
to
section
489.212.
10
2.
The
Code
editor
shall
correct
internal
references
in
the
11
Code
and
in
any
enacted
legislation
as
necessary
due
to
the
12
enactment
of
this
section.
13
Sec.
31.
EFFECTIVE
DATE.
This
Act,
being
deemed
of
14
immediate
importance,
takes
effect
upon
enactment.
15
EXPLANATION
16
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
17
the
explanation’s
substance
by
the
members
of
the
general
assembly.
18
GENERAL.
This
bill
amends
provisions
in
the
uniform
limited
19
liability
company
Act
(Code
chapter
489)
originally
enacted
20
in
2008
and
rewritten
during
the
2023
legislative
session
21
(2023
Iowa
Acts,
chapter
152).
The
2023
Iowa
Act
was
based
on
22
a
proposed
Act
(model
legislation)
approved
and
recommended
23
by
the
national
conference
on
commissioners
on
uniform
state
24
laws,
also
named
the
uniform
law
commissioners
(ULC),
which
25
includes
commissioners
appointed
by
the
Governor
(Code
chapter
26
5).
A
limited
liability
company
(LLC),
or
simply
“company”,
27
is
a
type
of
unincorporated
business
entity
formed
for
the
28
acquisition
of
capital
(contributions)
from,
and
the
payout
of
29
receipts
(distributions)
to,
its
investors
(members).
Although
30
an
LLC
is
sometimes
compared
to
other
types
of
unincorporated
31
entities,
and
specifically
a
limited
partnership
(Code
chapter
32
488)
or
general
partnership
(Code
chapter
486A),
it
also
33
resembles
a
corporation
(Code
chapter
490).
34
BILL
——
TERMINOLOGY
CHANGES,
SECTION
TRANSFER,
AND
INTERNAL
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REFERENCE
CORRECTIONS.
The
bill
makes
changes
in
terminology
1
to
be
consistent
with
the
model
legislation,
including
2
references
from
“articles
of
merger”
to
“statement
of
merger”,
3
and
from
“office
of
the
registered
agent”
to
“address
of
the
4
registered
agent”.
The
bill
corrects
a
number
of
internal
5
references
due
to
the
transfer
or
rewriting
of
the
Code
6
sections.
The
bill
transfers
a
Code
section
providing
for
7
biennial
reports
to
correspond
to
the
model
legislation
(from
8
Code
section
489.211A
to
489.212)
and
makes
new
corresponding
9
changes
to
internal
references.
Many
of
the
internal
10
reference
corrections
are
in
Code
chapter
489,
subchapter
XIV,
11
the
uniform
protected
series
Act,
which
is
separate
model
12
legislation
approved
and
recommended
by
the
ULC
and
enacted
in
13
2019
and
unamended
by
the
model
legislation
or
the
2023
Iowa
14
Act.
15
BILL
——
CORRESPONDING
CHANGE
——
DERIVATIVE
ACTIONS.
The
16
bill
includes
a
corresponding
change
in
Code
chapter
489,
17
subchapter
VIII,
providing
for
derivative
actions
by
members.
18
The
2023
Iowa
Act
departed
from
the
model
legislation
by
19
removing
an
option
that
allowed
a
member
to
maintain
a
20
derivative
action
(Code
section
489.802).
A
derivative
action
21
is
a
type
of
cause
of
action
brought
by
one
or
more
members
of
22
an
LLC
acting
on
behalf
of
the
LLC
to
enforce
a
right
held
by
23
the
LLC.
Under
the
model
legislation,
a
member
may
maintain
a
24
derivative
action
only
after
the
member
first
makes
a
demand
on
25
the
LLC
to
enforce
the
right.
The
model
legislation
allowed
26
the
member
to
skip
this
demand
requirement
if
it
would
be
27
futile.
The
2023
Iowa
Act
eliminated
this
exception.
However,
28
it
retained
a
corresponding
provision
in
the
model
legislation
29
(Code
section
489.804)
requiring
the
member
in
its
pleading
to
30
state
how
the
member
satisfied
the
notice
requirements
in
Code
31
section
489.802.
The
bill
eliminates
the
corresponding
futile
32
exception
in
the
pleading
requirement.
33
BILL
——
FEES.
The
model
legislation
does
not
include
a
fee
34
schedule
for
filing
documents
with
the
secretary
of
state,
but
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such
a
schedule
has
been
part
of
Code
chapter
489
since
it
1
was
enacted
and
the
schedule
resembles
those
in
Code
chapters
2
providing
for
other
types
of
business
entities
(see
Code
3
section
490.122
for
corporations).
The
bill
adds
a
fee
of
4
$50
for
filing
a
statement
of
domestication
or
statement
of
5
conversion.
6
EFFECTIVE
DATE.
The
bill
takes
effect
upon
enactment.
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