TITLE 10A Corporations, Partnerships, and Associations

Page

PREFACE ...................................................... i
INTRODUCTION .............................................. iii
CHAPTER 1 - GENERAL PROVISIONS .......................... 1
ARTICLE 1. Definitions and Other General Provisions ............... 1
DIVISION A: Definitions, Applicability and Purpose ................. 1
Short Title ............................. 1
Applicability of chapter ................... 1
Definitions ............................. 2
Disinterested person .................... 19
Conspicuous information ................. 20
Synonymous terms ..................... 21
Signing of document or other writing ....... 22
Short titles ............................ 22
Reference in law to statute revised by title . . . 23
10-2B-1.02 Reservation of power to amend or repeal .... 24
: Determination of Applicable Law.................... 24
Law governing filing entities .............. 24
Entities not formed by filing instrument ..... 24
Internal affairs ......................... 25
ARTICLE 2. Purposes and Powers of Domestic Entity ............... 25
: Purposes of Domestic Entity......................... 25
10-2B-3.01. Purposes General scope of permissible purposes ............................ 25
Prohibited purposes ..................... 26
Limitation on purposes of professional entity . 26
Limitation in governing documents ......... 27
: Powers of Domestic Entity.......................... 27
10-2B-3.02. General powers ........................ 27
Consideration for indebtedness ............ 30 31 32 32
Power to make guaranties ................
Stated powers in division sufficient .........
Limitation on powers ....................
Certificated indebtedness; manner of issuance;
Business transactions of owner with entity . . . 33

Page

issuance; signature and seal ............. 33

ARTICLE 3. Formation and Governance .......................... 34
DIVISION A: Formation, Existence, and Certificate ................ 34
Formation and existence of filing entities .... 34 Formation and existence of nonfiling entities . 35 Duration .............................. 35 Execution of certificate of formation ........ 35 Certificate of formation .................. 35 Filings in case of merger or conversion ...... 37
DIVISION B: Amendments and Restatements of Certificate of Formation .................................................. 37
Procedures to amend certificate of formation . 38
Certificate of amendment ................ 39
Effect of filing certificate of amendment ..... 40
Right to restate certificate of formation ...... 40
Procedures to restate certificate of formation . 41
Restated certificate of formation ........... 41
Effect of filing or restated certificate of
10-3A-80. Right to amend articles of incorporation certificate of formation ................ 37
formation ........................... 43
DIVISION C: Governing Persons and Officers ..................... 43
Rights of governing persons in certain cases . . 43 Officers .............................. 44 Removal of officers ..................... 45 Rights of officers in certain cases .......... 45
DIVISION D: Recording ....................................... 46
Books and records for domestic entities ..... 46
Right of examination by owner or member of a filing entity other than a corporation, professional corporation, or real estate investment trust ...................... 46
Governing person's right of inspection ...... 47
DIVISION E: Certificates Representing Ownership Interest .......... 49
Certificated or uncertificated ownership
Signature requirement ................... 51 Delivery requirement .................... 51 Notice for uncertificated ownership interest . . 51
interest. . ........................... 49
§10A-1-3.42. Form and validity of certificates; enforcement
of entity's rights ...................... 49
ARTICLE 4. Filings ............................................ 52
DIVISION A: General Provisions ................................ 52
Signature and delivery; execution by judicial
Time for filing ......................... 58
Certificates and certified copies ............ 58
10-2B-1.21. Forms adopted by Secretary of State ........ 59
act. ................................ 52
10-2B-1.25. Place of filing and filing duties of probate judge of probate and Secretary of State .... 53
10-2B-1.30. Powers of probate judge of probate and Secretary of State ..................... 59
DIVISION B: When Filings Take Effect ........................... 60
General rule ........................... 60
Delayed effectiveness of certain filings ...... 60
Abandonment before effectiveness ......... 60
Abandonment before effectiveness. Delayed effectiveness not permitted ...... 61
Acknowledgement of filing with delayed effectiveness ......................... 62
DIVISION C: Correction and Amendment ........................ 62
Corrections of filings .................... 62
Limitation on correction of filings .......... 63
Certificate of correction .................. 63
Filing certificate of correction ............. 63 Effect of certificate of correction ........... 64 Amendment of filings ................... 64
DIVISION D: Filing Fees ....................................... 65
10-2B-1.22. Filing, service, and copying fees. Filing fees; all entities ...................... 65

Page

ARTICLE 5. Names of Entities; Registered Agents and Registered Officers ............................................. 70
DIVISION A. General Provisions ................................ 70
Effect on rights under other law ........... 70
Unauthorized purpose in name prohibited .... 71
Names prohibited ....................... 71
Name of corporation or foreign corporation . . 72
10-9B-102. Name of limited partnership or foreign limited partnership .................... 73
10-4-387. Corporate name Name of professional corporation.......................... 74
10-8A-1002. Name of registered limited liability partnership .......................... 74
10-12-5. Limited liability company name Name of limited liability company or foreign limited liability company ............... 73 Name of professional entity; conflict with other law or ethical rule ................ 76
DIVISION B: Reservation of Names .............................. 76
Application for reservation of name ........ 76
§10A-1-5.12. Reservation of certain names prohibited;
Action on application .................... 78 Duration of reservation of name ........... 78 Renewal of reservation .................. 78 Transfer of reservation of name ............ 79
exceptions .......................... 77
DIVISION C: Registration of Names ............................. 79
Application by certain entities for registration of name ............................ 79
Application for registration of name ........ 79
Certain registrations prohibited; exceptions . . 80
Duration of registration of name ........... 81
Renewal of registration; rights with respect to registered name .................... 81
DIVISION D: Registered Agents and Registered Offices; Service of Process .............................................. 82
Designation and maintenance of registered
Change by entity of registered officer or
10-2B-5.03. Resignation or registered agent ............ 86
Method of service on entity not exclusive .... 88
Failure to designate and maintain
Change by registered agent of name or
ARTICLE 6. Indemnification and Insurance ....................... 89
DIVISION A: General Provisions ................................ 89
10-2B-8.50. Definitions ............................ 89
Application of article .................... 90
DIVISION B: Mandatory and Court Ordered Indemnification ....... 91
Mandatory indemnification ............... 91
Court-ordered indemnification ............ 92
Limitations in governing documents ........ 92
DIVISION C: Permissive Indemnification and Advancement of Expenses ................................................... 93
Permissive indemnification ............... 93 94
General scope of permissive indemnification .
Manner for determining permissive
Advancement of expenses ................ 96
Indemnification and advancement of expenses
indemnification ...................... 95
to persons other than governing persons . . . 97 Permissive indemnification of and
DIVISION D: Liability Insurance; Reporting Requirements .......... 99
Insurance and other arrangements .......... 99
Reports of indemnification and advances . . . 100
ARTICLE 7. Foreign Entities ................................... 101
DIVISION A: Registration ..................................... 101
Foreign entities required to register ........ 101
Foreign entities not required to register ..... 101
Permissive registration .................. 102
10-2B-15.03. Application for certificate of authority Registration procedure................ 102
10-2B-15.05. Effect of certificate of authority registration . 104
Amendments to registration .............. 104
Entity name .......................... 105
DIVISION B: Withdrawal ..................................... 106
Voluntary withdrawal of registration ....... 106
10-2B-15.30. Grounds for revocation ................. 108
10-2B-15.31. Procedure for and effect of revocation ..... 109
10-2B-15.32. Appeal from revocation ................. 110
DIVISION C: Consequences of Transacting Business without Registering ........................................... 111
10-12-52. Transaction of business without registration; generally .......................... 111
10-12-53. Action by attorney general Transaction of business without registration; actions to restrain .......................... 112
Late filing fee ........................ 112
Requirements of other law ............... 112
DIVISION D: Business, Rights, and Obligations ................... 112
Business of foreign entity ............... 112
Rights and privileges ................... 113
Obligations and liabilities ............... 113
Right of foreign filing entity to participate in the business of certain domestic entities 113
10-2B-15.11 Out of state business or property of foreign corporation entity not subject to control or regulation ........................ 113
10-2B-15.12. Right of eminent domain ................ 114
10-2B-15.13. Extension of lines, tracks, ways of works into state ........................... 114
DIVISION E: Miscellaneous Provisions .......................... 115
Applicability of this title to certain foreign entities ............................ 115
ARTICLE 8. Conversions and Mergers ........................... 115
10-15-3. Conversion of business entities; documentation and filing requirements; effective date of conversion; effects of conversion and nonprofit entities ............................ 115
10-15-4. Mergers of business entities .............. 123
10-15-908. Nonexclusive application of article ........ 129
10-15-6. Merger with or conversion from a foreign business entity ...................... 129
ARTICLE 9. Winding up and Termination of Domestic Entity ....... 131
DIVISION A. General Provisions ............................... 131
Definitions ........................... 131
DIVISION B. Winding up of Domestic Entity ..................... 131
Event requiring winding up of domestic entity ............................. 131
Winding up procedures ................. 132
DIVISION C. Provision for Known and Unknown Claims .......... 132
10-2B-14.06. Known claims against dissolved corporation domestic entity...................... 132
10-2B-14.07. Unknown claims against dissolved corporation domestic entity ............ 134
DIVISION D: Revocation and Reinstatement ..................... 135
Revocation of voluntary winding up ....... 135
Reinstatement ........................ 136
CHAPTER 2 - BUSINESS CORPORATIONS ..................... 137
ARTICLE 1. General Provisions ................................ 137
DIVISION A: Short Title and Applicability ....................... 137
10-2B-1.01. Short title and applicability .............. 137
DIVISION B: Filing Instruments ............................... 138
10-2B-1.20. Filing requirements instruments .......... 138
Filing fees ........................... 139
Reserved ............................ 139
10-2B-1.40. Definitions applicable to business corporations ........................ 140
10-2B-1.41. Notice...............................145
ARTICLE 2. Formation and Governing Documents ................ 146
10-2B-2.01. Incorporators ......................... 146
10-2B-2.03. Incorporation ......................... 148
10-2B-2.04. Liability for preincorporation transactions . . 149
10-2B-2.05. Organization of corporation .............. 149
10-2B-2.06. Bylaws .............................. 149
10-2B-2.07. Emergency bylaws ..................... 150
10-2B-2.02. Articles Supplemental provisions required or permitted in articles of incorporation ..... 146
10-2B-2.08. Incorporation by purchasers of property or franchise of corporation ............... 151
ARTICLE 3. Purposes and Powers .............................. 151
Purpose ............................. 151 General Powers ....................... 151 .................... 152 ........................... 153
10-2B-3.03. Emergency powers
10-2B-3.04. Ultra vires
ARTICLE 4. Reserved ......................................... 154
ARTICLE 5. Reserved ......................................... 154
ARTICLE 6. Shares and Distributions ........................... 155
DIVISION A: Shares ......................................... 155
10-2B-6.01. Authorized shares ..................... 155
10-2B-6.02. Terms of class or series determined by board of directors .................... 156
10-2B-6.03. Issued and outstanding shares ............ 157
10-2B-6.04. Fractional shares ...................... 158
DIVISION B: Issuance of Shares ................................ 159
10-2B-6.20. Subscription for shares before incorporation . 159 160 160 161 161
10-2B-6.21. Issuance of shares .....................
10-2B-6.22. Liability of shareholders and subscribers . . .
10-2B-6.23. Share dividends .......................
10-2B-6.24. Share options .........................
10-2B-6.28. Expense of issue ...................... 165
10-2B-6.25. Form and content of certificates Corporate shares as personal property; transferability 162
10-2B-6.27. Restriction on transfer of shares and other securities ...................... 163
DIVISION C: Subsequent Acquisition of Shares by Shareholders and Corporation .............................................. 165
10-2B-6.30. Shareholders' preemptive rights ........... 165
10-2B-6.31. Corporation's acquisition of its own shares . . 167
10-2B-6.32. Cancellation of reacquired shares ......... 167
DIVISION D: Distributions .................................... 168
10-2B-6.40. Distributions to shareholders ............. 168
ARTICLE 7. Shareholders ..................................... 170
DIVISION A: Meetings ....................................... 170
10-2B-7.01. Annual meeting ....................... 170 ....................... 17 .................. 17 ................. 17 ..................... 17 ...................... 17 .......................... 175
10-2B-7.02. Special meeting
10-2B-7.03. Court-ordered meeting
10-2B-7.04. Action without meeting
10-2B-7.05. Notice of meeting
10-2B-7.06. Waiver of notice
10-2B-7.07. Record date
DIVISION B: Voting ......................................... 176
10-2B-7.20. Shareholders' list for meeting ............ 176 177 178 180 180
10-2B-7.21. Voting entitlement of shares .............
10-2B-7.22. Proxies ..............................
10-2B-7.23. Shares held by nominees ................
10-2B-7.24. Corporation's acceptance of votes .........
10-2B-7.26. Action by single and multiple voting groups . 183 ..... 183 .... 184
10-2B-7.27. Greater quorum or voting requirements
10-2B-7.28. Voting for directors; cumulative voting
10-2B-7.25. Quorum and voting requirements for voting groups ............................ 182
DIVISION C: Voting Trusts and Agreements ..................... 185
10-2B-7.30. Voting trust .......................... 185
10-2B-7.31. Voting agreements ..................... 186
10-2B-7.32. Shareholder agreements ................. 186
DIVISION D: Infant Stockholders .............................. 189
10-6-1. Corporation without notice of infancy may treat infant as having capacity to vote, transfer, etc. ........................ 189
10-6-2. Infancy not entitled to disaffirm as against corporation without notice of infancy .... 189
10-6-3. Right of infant to receive dividends in own name .......................... 190
10-6-4. Effect of chapter on Transfers to Minors Act, etc ..................... 190
ARTICLE 8. Directors and Officers ............................. 190
DIVISION A: Board of Directors ............................... 190
10-2B-8.02. Qualifications of directors ............... 191
10-2B-8.03. Number and election of directors ......... 191
10-2B-8.05. Terms of directors generally ............. 192 ............. 193 ................. 193 ...... 194
10-2B-8.06. Staggered terms for directors
10-2B-8.07. Resignation of directors
10-2B-8.08. Removal of directors by shareholders
10-2B-8.01. Requirements for and duties of board of directors ......................... 190
10-2B-8.04. Election of directors by certain classes of shareholders ...................... 192
10-2B-8.09. Removal of directors by judicial proceeding . 194
10-2B-8.10. Vacancy on board ..................... 195
10-2B-8.11. Compensation of directors ............... 196
: Meetings and Actions of the Board.................. 196
10-2B-8.20. Meetings ............................ 196 ................. 197 ..................... 197 ...................... 198 .................... 198 .......................... 199
10-2B-8.21. Action without meeting
10-2B-8.22. Notice of meeting
10-2B-8.23. Waiver of notice
10-2B-8.24. Quorum and voting
10-2B-8.25. Committees
DIVISION C: Standards of Conduct ............................ 201
10-2B-8.30. General standards for directors ........... 201
10-2B-8.31. Fiduciary obligations not impaired ........ 202
10-2B-8.32. Depreciating stocks or bonds of corporation with intent to buy .................... 202
10-2B-8.33. Liability for unlawful distributions ........ 203
DIVISION D: Officers ........................................ 204
10-2B-8.40. Required officers ...................... 204 ...................... 204 .......... 205 ....... 205 ............... 206
10-2B-8.41. Duties of officers
10-2B-8.42. Standards of conduct for officers
10-2B-8.43. Resignation and removal of officers
10-2B-8.44. Contract rights of officers
DIVISION E: Indemnification .................................. 206
10-2B-8.50. Definitions ........................... 206 208 209 210 210
10-2B-8.51. Authority to indemnify .................
10-2B-8.52. Mandatory indemnification ..............
10-2B-8.53. Advance for expenses ..................
10-2B-8.54. Court-ordered indemnification ...........
10-2B-8.57. Insurance ............................ 213 . . 213
10-2B-8.58. Application of indemnification provisions
10-2B-8.55. Determination and authorization of indemnification ..................... 211
10-2B-8.56. Indemnification of officers, employees, and agents ......................... 212
DIVISION F: Directors' Conflicting Interest Transactions .......... 214
10-2B-8.60. Definitions ........................... 214
Judicial action ........................ 216
10-2B-8.62. Directors' action ....................... 217
10-2B-8.63. Shareholders' action .................... 218
ARTICLE 9. Reserved ......................................... 219
ARTICLE 10. Amendment of Articles of Incorporation & Bylaws .... 220
DIVISION A: Amendment of Articles of Incorporation ............. 220
10-2B-10.01. Authority to amend articles of incorporation . 220 220
10-2B-10.02. Amendment by board of directors .........
10-2B-10.04. Voting on amendments by voting groups . . . 222 ...... 224 .................. 224 ......... 225 ..... 226 ................... 227
10-2B-10.05. Amendment before issuance of shares
10-2B-10.06. Articles of amendment
10-2B-10.07. Restated articles of incorporation
10-2B-10.08. Amendment pursuant to reorganization
10-2B-10.09. Effect of amendment
10-2B-10.03. Amendment by board of directors and shareholders ........................ 221
DIVISION B: Amendment of Bylaws ............................ 227
10-2B-10.20. Amendment by board of directors or shareholders ........................ 227
10-2B-10.21. Bylaw increasing quorum or voting requirement for directors shareholders . . . 228
10-2B-10.22. Bylaw increasing quorum or voting requirement for directors .............. 229
ARTICLE 11. Merger and Share Exchange ....................... 229
10-2B-11.01. Merger .............................. 229 230 231 234 235 236
10-2B-11.02. Share exchange .......................
10-2B-11.03. Action on plan ........................
10-2B-11.04. Merger of subsidiary ...................
10-2B-11.05. Articles of merger or share exchange ......
10-2B-11.06. Effect of merger or share exchange ........
Nonexclusive ......................... 238
10-2B-11.07. Merger or share exchange with foreign corporation ......................... 237
10-2B-12.01. Sale of assets in regular course of business and mortgage of assets ................ 239
10-2B-12.02. Sale of assets other than in regular course of business ......................... 240
ARTICLE 13. Dissenters' Rights ................................ 241
DIVISION A: Right to Dissent and Obtain Payment for Shares ...... 241
10-2B-13.01. Definitions ........................... 241
10-2B-13.02. Right to dissent ....................... 242
10-2B-13.03. Dissent by nominees and beneficial owners . 244
DIVISION B: Procedure for Exercise of Dissenters' Rights .......... 245
10-2B-13.20. Notice of dissenter's rights ............... 245 245 246 246 247 248 249 249
10-2B-13.21. Notice of intent to demand payment .......
10-2B-13.22. Dissenters' notice ......................
10-2B-13.23. Duty to demand payment ................
10-2B-13.24. Share restriction .......................
10-2B-13.25. Offer of payment ......................
10-2B-13.26. Failure to take corporate action ...........
10-2B-13.27. Reserved ............................
10-2B-13.28. Procedure if shareholder dissatisfied with offer of payment ..................... 249
: Judicial Appraisal of Shares........................ 250
10-2B-13.30. Court action .......................... 250
10-2B-13.31. Court costs and counsel fees ............. 252
10-2B-13.32. Status of shares after payment ............ 253
ARTICLE 14. Dissolution ...................................... 253
DIVISION A: Voluntary Dissolution ............................ 253
10-2B-14.03. Articles of dissolution .................. 255 ............... 256 .................... 257
10-2B-14.04. Revocation of dissolution
10-2B-14.05. Effect of dissolution
10-2B-14.01. Dissolution by incorporators or initial directors ........................... 253
10-2B-14.02. Dissolution by board of directors and shareholders ........................ 254
DIVISION B: Administrative Dissolution ........................ 259
10-2B-14.20. Grounds for administrative dissolution ..... 259
10-2B-14.21. Procedure for and effect of administrative dissolution ......................... 260
10-2B-14.22. Reinstatement following administrative dissolution ......................... 261
10-2B-14.23. Appeal from denial of reinstatement ....... 262
DIVISION C: Judicial Dissolution .............................. 263
10-2B-14.30. Grounds for judicial dissolution .......... 263
10-2B-14.31. Procedure for judicial dissolution ......... 264
10-2B-14.32. Receivership or custodianship ............ 265
10-2B-14.33. Decree of dissolution ................... 266
10-2B-14.34. Election to purchase in lieu of dissolution . . . 267
DIVISION D: Miscellaneous ................................... 269
10-2B-14.40. Deposit with Commissioner of Revenue State Treasurer ...................... 269
ARTICLE 15. Foreign Corporations ............................. 270
DIVISION A: Registration ..................................... 270
10-2B-15.01. Authority Registration required to transact business required .................... 270
10-2B-15.02. Consequences of transacting business without authority registering ........... 271
DIVISION B: Reserved ....................................... 272
DIVISION C: Reserved ....................................... 272
DIVISION D: Acting in a Fiduciary Capacity ..................... 272
10-2B-15.40. Definitions ........................... 272
10-2B-15.42. Filing of verified statement with Commissioner of Revenue by foreign corporation prior to acting as fiduciary . . . 274
10-2B-15.41. Authority of foreign corporation to act as fiduciary ........................... 273
10-2B-15.43. Foreign corporation acting as fiduciary not deemed doing business in this state ...... 275
10-2B-15.44. Foreign corporation previously acting
fiduciary capacity in state ........... 276
10-2B-15.45. Service of process on foreign corporation acting in fiduciary capacity ............ 276
ARTICLE 16. Records and Reports .............................. 277
DIVISION A. Records ........................................ 277
10-2B-16.01. Corporate records ..................... 277 ...... 279 ................ 281 ................ 281
10-2B-16.02. Inspection of records by shareholders
10-2B-16.03. Scope of inspection right
10-2B-16.04. Court-ordered inspection
DIVISION B. Reports ......................................... 282
10-2B-16.20. Financial statements for shareholders ...... 282 ............. 283 ....... 284
10-2B-16.21. Other reports to shareholders
10-2B-16.22. Annual report for Secretary of State
ARTICLE 17. Application ..................................... 285
10-2B-17.02. Application to qualified foreign corporations ........................ 286
10-2B-17.01. Application to existing domestic corporations ........................ 285
CHAPTER 3 - NONPROFIT CORPORATIONS .................. 287
ARTICLE 1. General Provisions ................................ 287
Short title ............................ 287
Definitions ........................... 287
Applicability ......................... 289
Purposes ............................. 290
ARTICLE 2. Substantive Provisions ............................. 292
DIVISION A: Members and Directors .......................... 292
10-3A-26. Members ............................ 292 .......... 292 ............. 293 ...................... 293 .................... 294 ................... 294
10-3A-28. Meetings of members, generally
10-3A-29. Notice of members' meetings
10-3A-30. Waiver of notice
10-3A-31. Voting of members
10-3A-32. Quorum of members
10-3A-33. Greater voting requirements ............. 295
10-3A-34. Board Governing authority; board of directors ........................... 295
10-3A-36. Vacancies Board of directors; vacancies .... 297
10-3A-37. Quorum of directors .................... 298
10-3A-38. Committees Board of directors; committees . 298
10-3A-39. Place and notice of directors’ meetings; committee meetings .................. 299
DIVISION B: Officers ........................................ 301
10-3A-41. Officers ............................. 301 .................... 301
10-3A-42. Removal of officers
10-3A-35. Number and election of directors; terms; removal from office .................. 296
10-3A-40. Action by members or directors without meeting ............................ 300
DIVISION C: Bylaws; Books and Records ........................ 302
10-3A-27. Bylaws .............................. 302
10-3A-43. Books and records ..................... 302
DIVISION D: Entity Specific Powers; Limitations ................. 303
10-3A-44. Shares of stock and dividends prohibited; compensation and benefits permitted ..... 303
10-3A-45. Loans to directors and officers prohibited . . . 303
10-3A-20(14). Power to indemnify directors or officers .... 304
10-3A-21. Defense of ultra vires Assertion of lack of capacity or power; defense of ultra vires . . 304
ARTICLE 3. Formation of Nonprofit Corporations ................ 305
10-3A-60. Incorporators Generally; incorporators ..... 305
10-3A-63. Effect of filing articles of incorporation and issuance of certificate of incorporation Commencement of corporate existence ... 307
10-3A-61. Articles Supplemental provisions required in certificate of incorporation of formation . . 306
10-3A-64. Organization Organizational meeting of directors - First meeting of members ..... 307
ARTICLE 4. Amendments ..................................... 308
10-3A-81. Procedure to amend articles of incorporation the certificate of formation of nonprofit corporation........................... 308
10-3A-82. Articles Certificate of amendment; execution and required supplemental provisions.......................... 309
10-3A-83. Filing and effectiveness of articles of
Effect of amendment on existing causes of actions and suits ............. 310
10-3A-84. Restated articles of incorporation certificate of formation ............... 311
ARTICLE 5. Merger and Consolidation .......................... 313
10-3A-100. Procedure for merger ................... 313
10-3A-101. Procedure for consolidation .............. 314
10-3A-102. Approval of merger or consolidation ....... 315
10-3A-103. Articles of merger or consolidation ........ 315
10-3A-104. Effect of merger or consolidation ......... 317
10-3A-105. Merger or consolidation of domestic and foreign nonprofit corporations .......... 319
Nonexclusive ......................... 320
ARTICLE 6. Sale of Assets ..................................... 320
10-3A-120. Sale, lease, exchange, or mortgage of assets . 321
ARTICLE 7. Dissolution ....................................... 321
10-3A-140. Voluntary dissolution; procedure ......... 321
10-3A-141. Distribution Voluntary dissolution; distribution of assets generally ......... 323
10-3A-142. Plan Voluntary dissolution;plan of distribution of assets ................. 324
10-3A-143. Revocation Voluntary dissolution; revocation of voluntary dissolution proceedings ..... 325
10-3A-144. Articles Voluntary dissolution; articles of dissolution ....................... 327
10-3A-145. Filing Voluntary dissolution; filing of articles of dissolution ....................... 328
10-3A-146. Involuntary dissolution; grounds .......... 329
10-3A-155. Filing of order of dissolution ............. 336 ............ 336 ....... 336
10-3A-156. Deposits with State Treasurer
10-3A-157. Survival of remedy after dissolution
10-3A-147. Notification Involuntary dissolution; procedure; notification to Attorney General ............................ 329
10-3A-148. Venue Involuntary dissolution; venue and service of process .................... 330
10-3A-149. Jurisdiction Liquidation; jurisdiction of court to liquidate assets and affairs of corporation ......................... 331
10-3A-150. Procedure in liquidation of corporation by court ........................... 332
10-3A-151. Qualification Liquidation; qualification of receivers ......................... 334
10-3A-152. Filing Liquidation; filing of claims in liquidation proceedings ............... 334
10-3A-153. Discontinuance Liquidation; discontinuance of liquidation proceedings ............. 335
10-3A-154. Entry Liquidation; entry of order of involuntary dissolution ............... 335
ARTICLE 8. Miscellaneous Provisions ........................... 339
10-3A-223. Unauthorized assumption of corporate powers ............................ 339
10-3A-225. Effect of repeal of prior acts ............. 340
CHAPTER 4 - PROFESSIONAL CORPORATIONS ............... 341
ARTICLE 1. General Provisions ................................ 341
10-4-380. Short title ............................ 341
10-4-381. Applicability of Business Corporation Act Law and Nonprofit Corporation Act Law . 341
10-4-382. Definitions. .......................... 342
ARTICLE 2. Purposes, Powers, and Organization .................. 343
10-4-383. Purposes for which professional corporations may be organized .................... 343
10-4-384. Applicability of article generally Required statement of purpose in certificate of incorporation ....................... 344
10-8A-104. Supplemental principles of law ........... 414
10-8A-106. Law governing internal relations .......... 416
10-8A-103. Effect of partnership agreement; nonwaivable provisions ............... 413
10-8A-105. Execution, filing, and recording of statements .......................... 415
10-8A-107. Partnership subject to amendment or repeal of chapter .................. 417
ARTICLE 2. Nature of Partnership .............................. 417
10-8A-201. Partnership as entity .................... 417
10-8A-202. Formation of partnership ................ 417
10-8A-203. Partnership property ................... 418
10-8A-204. When property is partnership ............ 418
ARTICLE 3. Relations of Partners to Persons Dealing with Partnership .................................................. 419
10-8A-301. Partner agent of partnership .............. 419 .......... 420 ......... 421 424
10-8A-302. Transfer of partnership property
10-8A-303. Statement of partnership property
10-8A-304. Statement of denial ....................
10-8A-306. Partner's liability ...................... 424
10-8A-308. Liability of purported partner ............ 427
10-8A-305. Partnership liable for partner's actionable conduct ................... 424
10-8A-307. Actions by and against partnership and partners ........................ 426
ARTICLE 4. Relations of Partners to Each Other and to Partnership .................................................. 428
10-8A-4.01. Partner's rights and duties ............... 428 430
10-8A-402. Distributions in kind ...................
10-8A-404. General standards of partner's conduct ..... 431
10-8A-405. Actions by partnership and partners ....... 432
10-8A-403. Partner's rights and duties with respect to information ......................... 430
10-8A-406. Continuation of partnership beyond definite term or particular undertaking . . . 433
ARTICLE 5. Transferees and Creditors of Partners ................ 434
10-8A-503. Transfer of partner's transferable interest . . . 434
10-8A-501. Partner not co-owner of partnership property ........................... 434
10-8A-502. Partner's transferable interest in partnership ......................... 434
10-8A-504. Partner's transferable interest subject to charging order ...................... 435
ARTICLE 6. Partner's Dissociation .............................. 436
10-8A-601. Events causing partner's dissociation ....... 436
10-8A-602. Partner's power to dissociate; wrongful dissociation ........................ 439
10-8A-603. Effect of partner's dissociation............440
ARTICLE 7. Partner's Dissociation When Business Not Wound Up ................................................... 441
10-8A-701. Purchase of dissociated partner's interest . . . 441
10-8A-704. Statement of dissociation ................ 445 ........ 445
10-8A-705. Continued use of partnership name
10-8A-702. Dissociated partner's power to bind and liability to partnership ................ 443
10-8A-703. Dissociated partner's liability to other persons ............................ 443
ARTICLE 8. Winding Up Partnership Business .................... 445
10-8A-802. Partnership continues after dissolution ..... 447
10-8A-803. Right to wind up partnership business ...... 448
10-8A-805. Statement of dissolution ................ 449
10-8A-801. Events causing dissolution and winding up of partnership business ................ 445
10-8A-804. Partner's power to bind partnership after dissolution ..................... 448
10-8A-806. Partner's liability to other partners after dissolution ......................... 449
10-8A-807. Settlement of accounts and contributions among partners ...................... 450
ARTICLE 9. Reserved ......................................... 451
ARTICLE 10. Registered Limited Liability Partnership ............. 453
10-8A-10.01. Registered limited liability partnerships .... 453
Reserved ............................ 457
10-8A-10.04. Admissibility of registration information . . . 458
10-8A-10.03. Registered office and registered agent. Reserved........................... 457
10-8A-10.05. Cancellation of a registered limited liability partnership .................. 459
10-8A-10.06. Registration of foreign registered limited liability partnerships ................. 460
10-8A-10.07. Withdrawal of a qualified foreign registered limited liability partnership ............ 463
10-8A-10.08. Effect of failure of foreign registered limited liability partnership to register .... 463
10-8A-10.09. Applicability of article to foreign and interstate commerce .................. 464
10-8A-10.10. Professional registered limited liability partnership provisions ................ 465
ARTICLE 11. Miscellaneous Provisions .......................... 467
10-8A-1101. Uniformity of application ............... 467
10-8A-1102. Savings Clause. ....................... 468
10-8A-1107. Composite returns ..................... 468
10-8A-1109. Taxation of registered limited liability partnership ......................... 469
CHAPTER 9 - LIMITED PARTNERSHIPS ...................... 471
ARTICLE 1. General Provisions ................................ 471
10-9B-1202. Short title ............................ 471 ... 471 ............................ 473 Reserved ............................ 473 ..... 473 ..................... 475
10-9B-101. Definitions affecting limited partnerships
10-9B-103. Reserved
10-9B-105. Records to be kept; right of inspection
10-9B-106. Nature of business
ARTICLE 2. Certificate of Limited Partnership ................... 475
10-9B-201. Certificate of limited partnership .......... 475
10-9B-202. Amendment to certificate; when required ... 476
10-9B-203. Cancellation of certificate ............... 478
10-9B-204. Execution of certificates; filing fees ....... 478
10-9B-207. Liability for material false statement
certificate ........................ 480
10-9B-208. Scope of notice ....................... 480
ARTICLE 3. Limited Partners .................................. 481
10-9B-301. Admission of limited partners ............ 481
10-9B-302. Voting .............................. 482
10-9B-303. Liability to third parties ................. 482
10-9B-304. Person erroneously believing himself or herself a limited partner ............... 484
ARTICLE 4. General Partners .................................. 486
10-9B-401. Admission of additional general partners . . . 486
10-9B-402. Events of withdrawal ................... 486
10-9B-403. General powers and liabilities ............ 488
10-9B-404. Contributions by general partner .......... 488
10-9B-405. Voting .............................. 489
ARTICLE 5. Finance .......................................... 489
10-9B-501. Form of contribution ................... 489
10-9B-502. Liability for contribution ................ 489
10-9B-503. Sharing of profits and losses ............. 490
10-9B-504. Sharing of distribution .................. 491
ARTICLE 6. Distributions and Withdrawals ...................... 491
10-9B-601. Interim distribution .................... 491
10-9B-602. Withdrawal of general partner ............ 491
10-9B-603. Withdrawal of limited partner ............ 492
10-9B-604. Distribution upon withdrawal ............ 493
10-9B-605. Distribution in kind .................... 493
10-9B-606. Rights to distribution ................... 494
10-9B-607. Limitations on distribution .............. 494
ARTICLE 7. Assignment of Partnership Interests .................. 495
10-9B-701. Nature of partnership interest ............ 495
10-9B-702. Assignment of partnership interest ........ 495
10-9B-703. Rights of Creditor ..................... 496
10-9B-704. Right of assignee to become limited partner . 496 .......... 497
10-9B-7.05. Powers of successors in interest
ARTICLE 8. Dissolution ....................................... 498
10-9B-801. Nonjudicial dissolution ................. 498 .................... 498 .......................... 499 ................... 499 500
10-9B-802. Judicial dissolution
10-9B-803. Winding up
10-9B-804. Distribution of assets
10-9B-805. Settling of accounts; applicability of section .
ARTICLE 9. Reserved ......................................... 501
ARTICLE 10. Derivative Actions ................................ 502
10-9B-1001. Right of action ........................ 502 ........................ 502 ............................. 503 ............................ 503
10-9B-1002. Proper plaintiff
10-9B-1003. Pleading
10-9B-1004. Expenses
ARTICLE 11. Reserved ........................................ 503
ARTICLE 12. Miscellaneous .................................... 504
10-9B-1201. Construction of application .............. 504
10-9B-1203. Severability .......................... 505
10-9B-1205. Rules for cases not provided for in this chapter or in applicable provisions of Chapter 1 .......................... 505
10-9B-1206. Savings clause ........................ 505
CHAPTER 10 - REAL ESTATE INVESTMENT TRUSTS .......... 507
10-13-1. Short title ............................ 507 507
10-13-2. Definitions ...........................
10-13-4. Construction with other law ............. 508 ................... 508 .................... 509 ................. 510 .................... 513 .............................. 513
10-13-5. Compliance required
10-13-6. Declaration of trust
10-13-7. Classification of shares
10-13-8. Removal of trustees
10-13-9. Powers
10-13-3. Permitted form of unincorporated trust or association ......................... 507
10-13-11. Annual report ......................... 515
10-13-12. Inspection of records ................... 516
10-13-13. Filing fees ........................... 516
10-13-14. Amendment of declaration .............. 517
10-13-15. Merger .............................. 518
10-13-16. Termination of existence Dissolution ...... 524
10-13-17. Liability of trust ....................... 525
10-13-19. Liability of trustee ..................... 525
10-13-20. Service of process ..................... 526
10-13-21. Income tax ........................... 527
Reserved ............................ 528
10-13-24. Treatment of distribution ................ 528
10-13-10. Restrictions Provisions on investments and use ............................ 515
10-13-18. Nonliability of shareholders for obligations of trust ................... 525
10-13-23. Treatment of corporate real estate investment trust ..................... 528
CHAPTER 11 - EMPLOYEE COOPERATIVE CORPORATIONS ... 531
10-14-1. Short title ............................ 531 531 532 532 533
10-14-2. Definitions ...........................
10-14-3. Election as employee cooperative .........
10-14-4. Revocation ...........................
10-14-5. Corporate name .......................
10-14-7. Directors and officers .................. 534
10-14-10. Internal capital accounts ................ 535
10-14-11. Internal capital account cooperatives ....... 536
10-14-6. Members; membership shares; rights and responsibilities ...................... 533
10-14-8. Voting power; amendment or repeal of bylaws; protection of stockholders ...... 534
10-14-9. Apportionment, etc., of net earnings or losses ........................... 535
10-14-12. Conversion of membership shares, etc.; merger of employee cooperatives ....... 536
CHAPTER 12 - RESERVED ................................... 539
CHAPTER 13 - RESERVED ................................... 540
CHAPTER 14 - RESERVED ................................... 541
CHAPTER 15 - RESERVED ................................... 542
CHAPTER 16 - BUSINESS TRUSTS ............................ 543
19-3-60. Definition of 'business trust.' ............. 543
19-3-61. Establishment; lawful purposes ........... 543
19-3-67. Taxation. ........................... 546
19-3-62. Powers and liabilities of trustees; liability of trust for acts of trustees ............. 543
19-3-63. Certificate of ownership; liability of beneficial owners .................... 544
19-3-64. Contents and recordation of declaration of trust ............................ 544
19-3-65. Duration of business trust; rules against perpetuities and restraint of alienation not violated ........................... 545
19-3-66. Suits against trust; property subject to attachment and execution ............ 546
CHAPTER 17 - UNINCORPORATED NONPROFIT ASSOCIATIONS ............................................. 547
10-3B-1. Short title ............................ 547 547
10-3B-2. Definitions ...........................
10-3B-4. Governance .......................... 548
10-3B-6. Statement of authority as to real property . . . 549
10-3B-7. Liability in tort and contract ............. 551
10-3B-8. Capacity to assert and defend; standing ..... 551
10-3B-9. Effect of judgment or order .............. 552
10-3B-13. Venue ............................... 554
10-3B-14. Summons and complaint; service on whom . 554
10-3B-3. Supplementary general principles of law and equity .......................... 548
10-3B-5. Real and personal property; nonprofit association as legatee, devisee, of beneficiary ....................... 549
10-3B-10. Disposition of personal property of inactive or dissolved nonprofit association ....... 552
10-3B-11. Appointment of agent to receive service of process .......................... 553
10-3B-12. Claim not abated by change of members or offices .......................... 554
10-3B-15. Transition concerning real and personal property ........................... 555
10-3B-16. Other acts not repealed ................. 555
10-3B-17. Savings clause ........................ 557
10-3B-18. Uniformity of application and construction . . 557
CHAPTER 18 - RESERVED ................................... 559
CHAPTER 19 - RESERVED ................................... 560
CHAPTER 20 - SPECIAL PURPOSE ENTITIES .................. 561
ARTICLE 1. Bishop of Diocese .................................. 561
10-4-1. Authority to incorporate ................ 561 561 562 563
10-4-2. Proceedings to incorporate ..............
10-4-3. Certificate of incorporation ..............
10-4-4. Powers ..............................
10-4-7. Dissolution ........................... 566
10-4-8. Fees to be paid to the Secretary of State .... 566
10-4-5. Certificate of succession by successor of bishop .......................... 564
10-4-6. Appointment of administrator to act while bishopric vacant ..................... 565
10-4-9. Records and certificates prima facie evidence ........................... 567
ARTICLE 2. Churches, Public Societies, and Graveyard Owners ..... 567
10-4-20. Incorporation ......................... 567 568
10-4-21. Powers of corporation ..................
10-4-23. Validity of service of process on trustee .... 569
10-4-25. Sale and conveyance of property .......... 570
10-4-22. Independence of church corporations in control of real property ............... 569
10-4-24. Borrowing of money and securing same by mortgage or deed of trust .............. 570
10-4-26. Effect of recital in minutes of proceedings under Sections 10-4-24 and 10-4-25 10A-20-2.05 and 10A-20-2.06 .......... 571
10-4-27. Burial societies - Special powers .......... 571
10-4-28. Burial societies - Chairman Chair and members of board ................... 571
ARTICLE 3. Conferences of Ministers ........................... 572
10-4-40. Formation of ministers into body corporate . 572 573 574
10-4-41. Powers of corporation ..................
10-4-42. Changing of corporate name .............
10-4-43. Incorporation by successor of unincorporated or defectively incorporated conference . . . 574
ARTICLE 4. State Conventions or Associations of Churches ......... 575
10-4-60. Powers of conventions or associations ..... 575
10-4-61. Establishment of schools, hospitals, orphanages, etc., by state, sectional, or national conventions or associations ..... 576
10-4-62. Perpetual existence of conventions or association ....................... 576
10-4-63. Ratification and confirmation or corporate existence...........................577
ARTICLE 5. Educational Institutions ............................ 577
10-4-80. Amendment of charter; fees for filing same; certified copy thereof ................. 577
10-4-81. Distribution of proceeds when corporation ceases business ...................... 579
10-4-82. Disposition of property of educational corporations where the stockholders are unknown or the number of shares is unknown ......................... 579
ARTICLE 6. Health Care Service Plans .......................... 581
10-4-100. Applicability of article .................. 581 581 582 583 584 .... 584
10-4-101. Incorporation .........................
10-4-102. Health care facilities which may participate .
10-4-103. Board of directors .....................
10-4-104. Bylaws ..............................
10-4-105. Altering, amending, or changing charter
10-4-106. Certificates of authority; contracts with public ............................. 585
10-4-107. License, privilege, or other taxes by municipalities or counties prohibited ....... 585
10-4-108. Selection of health care facility by certificate holders ............................ 586
10-4-109. Regulation of rates, charges, fees and dues . . 586
10-4-112. Deposit of securities with State Treasurer . . . 588
10-4-113. Filing of annual statements .............. 589
10-4-115. Applicability of insurance laws ........... 590
10-4-110. Examination power of Commissioner of Insurance ........................ 587
10-4-111. Certificates for agents; filing of health service certificates ................... 587
10-4-114. Review of decisions, etc., by Commissioner of Insurance ........................ 590
ARTICLE 7. Industrial Development Corporations ................ 591
10-4-130. Definitions ........................... 591 592 595 595 . . 597 597 598
10-4-131. Incorporation .........................
10-4-132. First meeting .........................
10-4-133. Powers of corporation ..................
10-4-134. Membership - Application; when effective
10-4-135. Membership - Withdrawal ...............
10-4-136. Directors and officers ..................
10-4-138. Powers of stockholders and members ...... 599
10-4-140. Loans to corporation by members ......... 601
10-4-141. Credit of state not to be pledged .......... 603
10-4-142. Taking of security by mortgage or otherwise 603
10-4-143. Tax exemptions, credits, and privileges .... 604
10-4-144. Occupational license taxes ............... 604
10-4-145. Setting apart of earned surplus ........... 604
10-4-146. Deposit of funds in designated depository . . . 605
10-4-147. Annual examination and reports .......... 605
10-4-148. Fiscal year ........................... 605
10-4-150. Duration of corporation ................. 607 ........................... 607 . . 607
10-4-151. Dissolution
10-4-152. Applicability of laws regulating securities
10-4-137. Corporation to be state development company ........................... 599
10-4-139. Rights to shares, bonds, securities, or other evidences of corporate indebtedness ..... 600
10-4-149. Amendment of articles of incorporation certificate of formation ............... 606
ARTICLE 8. Local Fraternal Orders ............................ 608
10-4-170. Definitions ........................... 608
10-4-174. Declaratory actions - Institution of action . . 612
10-4-175. Declaratory actions - Service of process .... 612
10-4-176. Declaratory actions - Averments of plaintiff . 613
10-4-177. Declaratory actions - Judgment. .......... 613
10-4-171. Right of majority group of local organization in fraternal property ....... 610
10-4-172. Withdrawal from parent organization and use of fraternal property free from trust clause ......................... 610
10-4-173. Right to set up unit independent of parent corporation ................... 611
10-4-178. Averments as to loans from parent organization; judgment to provide for repayment and lien for unsecured loans . . . 614
10-4-179. Effect of article on existing liens or mortgages .......................... 614
ARTICLE 9. Single-Tax and Other Mutual Economic Associations ... 615
10-4-190. Incorporation ......................... 615 615 616
10-4-191. Officers; constitution; bylaws ............
10-4-192. Powers ..............................
10-4-193. Exemption of certain waterworks from ad valorem taxes and state or county license taxes on gross receipts .......... 616
10-4-194. Recognition of association of lessees, etc.; arbitration of certain disputes arising under real estate leases ................ 616
ARTICLE 10. Private Foundations .............................. 618
10-4-210. Restrictions; powers of courts and Attorney General not impaired ................. 618
ARTICLE 11. Alteration, Amendment, or Extension of Charter of Medical, Dental, Pharmaceutical, or Similar Associations ........... 619
10-1-1. Alteration, amendment, or extension of charter by incorporated medical, dental, pharmaceutical, etc., association ........ 619
ARTICLE 12. Alteration or Amendment of Charters of Corporations Not Of A Business Character ....................... 621
10-1-3. Alteration or amendment of charter by corporations not of business character; filing and contents of declarations; issuance of certificate; provisions cumulative ..... 621
ARTICLE 13. Retail Merchants' Associations ..................... 622
10-4-260. Authority Retail merchants; authority to form corporation ......................... 622
ARTICLE 14. Wholesale Merchants' Associations ................. 623
10-4-280. Incorporation Wholesale merchants; authority to form corporation ........... 623
ARTICLE 15. Water Power Companies .......................... 623
10-4-320. Rights, powers, and authority ............ 623
10-4-321. Duty to serve public .................... 627
10-4-322. Procedure for condemnation ............. 627
10-4-323. Dams considered as authorized by Legislature ......................... 628
ARTICLE 16. Liability of Officers of Nonprofit Organizations ....... 628
10-11-1. Legislative intent ...................... 628
10-11-2. Definitions ........................... 628
10-11-3. Officer immune from suit; exception for willful misconduct, fraud, or gross negligence; for-profit subsidiary not immune ........................ 629
10-11-4. Application .......................... 630
10-11-5. Construction..........................630

agent and registered office .............. 82

registered agent ...................... 83

address or registered agent .............. 85

registered agent ...................... 88

reimbursement of expenses to witnesses . . . 98

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Page

Page

§10A-4-2.03 10-4-385. Powers of professional corporation generally; profession limited by articles of incorporation certificate of formation . . 345

§10A-4-2.04 10-4-386. Rendition of professional services ......... 346

ARTICLE 3. Shareholders; Directors and Officers; Professional Liability ..................................................... 346

§10A-4-3.01 10-4-388. §10A-4-3.02 10-4-389. §10A-4-3.03 10-4-390. §10A-4-3.04 10-4-391.

§10A-4-3.05 10-4-392.§10A-4-3.06 10-4-393.

Issuance and transfer of shares ........... 346 Death or disqualification of shareholder .... 347 Liability generally ..................... 350 Professional relationships; privileged

communications ..................... 351 Voting trusts ......................... 351 Directors and officers .................. 351

ARTICLE 4. Special Provisions as to Amendments; Merger
and Consolidation ............................................ 352
§10A-4-4.01 10-4-394. Amendments to articles of incorporation
certificate of formation by administrators
and the like ......................... 352
§10A-4-4.02 10-4-395. Merger and consolidation ............... 353

ARTICLE 5. Regulation of Professional Corporations; Foreign Professional Corporations; Application to Existing Corporations ..... 354

§10A-4-5.01 10-4-396.

§10A-4-5.02 10-4-397.

§10A-4-5.03 10-4-398. §10A-4-5.04 10-4-399. §10A-4-5.05 10-4-400. §10A-4-5.06 10-4-401. §10A-4-5.07 10-4-402. §10A-4-5.08 10-4-403.

Involuntary dissolution at the request of

licensing authority on petition of

Attorney General .................... 354 Admission of foreign professional

corporations ........................ 354 Revocation of certificate of authority ...... 356 Annual Report of domestic and foreign

professional corporations .............. 356 Interrogatories by licensing authority;

generally .......................... 357 Penalty for false statement, etc.; procedure

upon failure to answer interrogatories .... 358 Article Chapter does not restrict regulation

by licensing authority ................ 358 Application to existing corporations ....... 359

Page CHAPTER 5 - LIMITED LIABILITY COMPANIES ............... 361 ARTICLE 1. General Provisions ................................ 361

§10A-5-1.01 10-12-1. §10A-5-1.02 10-12-2.§10A-5-1.03 10-12-4.§10A-5-1.04. §10A-5-1.05 10-12-7. §10A-5-1.06 10-12-8. Short title ............................ 361 Definitions ........................... 361 Powers .............................. 364 Indemnification ....................... 366 Unauthorized assumption of powers ....... 367 Application of partnership provisions to limited liability companies; classification for federal income tax purposes ......... 368
ARTICLE 2. Formation ....................................... 368
§10A-5-2.01 10-12-9.§10A-5-2.02 10-12-10. Formation ............................ 368 (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Articles of Organization Supplemental Provisions required in the certificate of Formation ............... 369
§10A-5-2.03 10-12-11. Amendment of articles of organization certificate of formation ............... 370
§10A-5-2.04 10-12-13. §10A-5-2.05. §10A-5-2.06 10-12-16. §10A-5-2.07 10-12-18. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Execution ........ 371 Pro-formation transactions ............... 372 Records to be kept; right of inspection ..... 373 Parties to actions ...................... 374

ARTICLE 3. Relationship of Members and Managers to Third Parties 375

§10A-5-3.01 10-12-19. Business transactions of a member with the
limited liability company .............. 375
§10A-5-3.02 10-12-20. Liability of members to third parties ....... 375

§10A-5-3.03 10-12-21. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre-1997 changes, and to all limited liability companies after December 31, 2000. See the Code Commissioner's Note following this code section.) Agency power of members and managers; duties . . 375

ARTICLE 4. Relationship Among Members ...................... 379

§10A-5-4.01 10-12-22. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Management of the limited liability company; creation of classes; voting; rights; meetings. .............. 379

§10A-5-4.02 10-12-23. Limited liability company property ........ 381

§10A-5-4.03 10-12-24. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Operating agreements ....... 382

§10A-5-4.04 10-12-25. Derivative actions ..................... 383

ARTICLE 5. Contributions and Distributions ..................... 384

§10A-5-5.01 10-12-26. Contribution .......................... 384
§10A-5-5.02 10-12-27. Liability for contributions ............... 384
§10A-5-5.03 10-12-28. Sharing of profits and losses ............. 385
§10A-5-5.04 10-12-29. (Applicable to limited liability companies
organized after January 1, 1998, limited
liability companies not electing to come
under the pre 1997 changes, and to all
limited liability companies after December

31, 2000.) Interim distributions of property; impairment of capital ................. 385

§10A-5-5.05 10-12-30. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all liability limited companies after December 31, 2000.) Purchase of interest of member whose membership has ceased .......... 386

ARTICLE 6. Transfer of Membership Interest .................... 387

§10A-5-6.01 10-12-31. §10A-5-6.02 10-12-32. §10A-5-6.03 10-12-33. §10A-5-6.04 10-12-34. §10A-5-6.05 10-12-35. Admission of additional members ......... Transferability of member's interest ....... Right of assignee to become member ...... (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Death or incompetency of member .............. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Member's financial rights subject to charging order .............................. 387 387 388 389 390
§10A-5-6.06 10-12-36. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Cessation of membership ..... 391
ARTICLE 7. Dissolution ....................................... 394
§10A-5-7.01 10-12-37. §10A-5-7.02 10-12-38.§10A-5-7.03 10-12-39.§10A-5-7.04 10-12-40. §10A-5-7.05 10-12-41. §10A-5-7.06 10-12-42. Dissolution Events of dissolution ......... Judicial dissolution .................... Winding up .......................... Survival of remedy after dissolution ....... Distribution of assets upon dissolution ..... Articles of dissolution .................. 394 395 395 396 396 397
Page

§10A-5-8.01 10-12-45. (Applicable to limited liability companies organized after January 1, 1998, limited liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Special rules for limited liability companies performing professional services ........ 399

ARTICLE 9. Merger and Consolidation .......................... 401

§10A-5-9.01 10-12-54. §10A-5-9.02 10-12-55.

§10A-5-9.03 10-12-56. §10A-5-9.04 10-12-57.

§10A-5-9.05 10-12-58.

§10A-5-9.06.

CHAPTER 6 - RESERVED CHAPTER 7 - RESERVED

Merger and consolidation ............... 401 (Applicable to limited liability companies organized after January 1, 1998, limited

liability companies not electing to come under the pre 1997 changes, and to all limited liability companies after December 31, 2000.) Requirements for articles of merger; effective date ................ 402

Vesting of certain rights, privileges, powers, property, liabilities and duties .......... 403

Recording of articles of merger; effect when Secretary of State files articles; copy of certified articles conclusive evidence of matters .......................... 404

Applicability of Article 5 of Chapter 2A of Title 10 Applicability of Chapter 2; merger and conversion provisions to limited liability companies ......................... 405

Nonexclusivity ........................ 405

.................................... 407

.................................... 408

CHAPTER 8 - GENERAL PARTNERSHIPS ..................... 409

ARTICLE 1. General Provisions ................................ 409

§10A-8-1.01 10-8A-1102. Short title ............................ 409 §10A-8-1.02 10-8A-101. Definitions ........................... 409 §10A-8-1.03 10-8A-102. Knowledge and notice .................. 412

Page Page

CHAPTER 21 - CERTAIN POWERS, RIGHTS, AND DUTIES OF CORPORATIONS ................................. 633 ARTICLE 1. Corporate Political Contributions .................... 633

§10A-21-1.01 10-1-2. §10A-21-1.02 10-2A-70. §10A-21-1.03 10-2A-70.1.

§10A-21-1.04 10-2A-70.2.

Establishment of segregated, separate

political funds; voluntary contributions

filing of disclosure reports; violations .... 633 Giving aid or contribution to political party

or candidate, etc.; penalty; exception

for voluntary separate political fund ..... 634 Limitation on amount of political

contribution; provisions supplemental .... 635 Corporation contributions to candidates,

parties, etc. ......................... 636

ARTICLE 2. Corporate Powers of Eminent Domain ................ 637

§10A-21-2.01 10-5-1.

§10A-21-2.02 10-5-2. §10A-21-2.03 10-5-2.1. §10A-21-2.04 10-5-3.

§10A-21-2.05 10-5-4.

§10A-21-2.06 10-5-5. §10A-21-2.07 10-5-6.

§10A-21-2.08 10-5-7.

Power of eminent domain in internal
improvement or public utility
corporations ........................ 637
Condemnation for ways and rights-of-ways,
etc., by railroad companies ............ 637
Railroads authorized to transfer abandoned
rights-of-way ....................... 638
Condemnation for rights-of-way or
easements by mining, manufacturing,
industrial, power, and quarrying
companies ......................... 638
Condemnation of ways and rights-of-way
by companies constructing, operating, or
maintaining internal improvement or

public utility ........................ 640 Construction through curtilage of house, etc., without consent prohibited ......... 640

Condemnation of water sources, riparian rights, and necessary lands by waterworks corporation ......................... 640

Condemnation of lands for depots, yards, and tracks by railroads ................ 642

§10A-21-2.09 10-5-8. Rights of condemning corporations in
selection of routes and sites ............ 642
§10A-21-2.10 10-5-9. Operation of transportation methods for
persons or property by railroad, mining,
manufacturing and quarrying companies . . 643
§10A-21-2.11 10-5-10. Conveyance of franchises, rights, roadbed,
and property to another railroad
corporation ......................... 644
§10A-21-2.12 10-5-11. Aiding of another corporation in railroad
construction or entering into line
arrangements ....................... 645
§10A-21-2.13 10-5-12. Operation of railroads or canals without
state and making extensions within state by
railroad, mining, manufacturing, and
quarrying companies ................. 646
§10A-21-2.14 10-5-13. Construction and operation of connections
to public ways by mining, manufacturing,
and quarrying corporations ............ 646
§10A-21-2.15 10-5-14. Contracting with local authorities on use of
public roads and places by internal
improvement and public utility
corporations ........................ 647

ARTICLE 3. Prosecution of Corporations ........................ 648

§10A-21-3.01 10-7-1. Docketing and issuance of notice of indictment ......................... 648
§10A-21-3.02 10-7-2. Service of notice and copy; when case stands for trial ...................... 648
§10A-21-3.03 10-7-3. §10A-21-3.04 10-7-4. Entry of not guilty plea for corporation failing to appear, etc .................. 648 Execution on judgment; stay thereof ....... 649

CHAPTER 22 - RESERVED CHAPTER 23 - RESERVED CHAPTER 24 - RESERVED CHAPTER 25 - RESERVED CHAPTER 26 - RESERVED CHAPTER 27 - RESERVED

................................... 651 ................................... 652 ................................... 653 ................................... 654 ................................... 655 ................................... 656

Page CHAPTER 28 - RESERVED ................................... 657 CHAPTER 29 - RESERVED ................................... 658 CHAPTER 30 - PROVISIONS APPLICABLE TO EXISTING ENTITIES

OF A TYPE THAT MAY NO LONGER BE FORMED:
UNINCORPORATION UNINCORPORATED PROFESSIONAL
ASSOCIATIONS AND CLOSE CORPORATIONS ................ 659
ARTICLE 1. Unincorporated Professional Associations ............. 659
§10A-30-1.01 10-10-1. Definitions; applicable to professional
associations formed prior to January 1,
1984 .............................. 659
§10A-30-1.02 10-10-2. Laws Governing – Generally; Applicability
of article to professional associations
formed prior to January 1, 1984 ......... 659
§10A-30-1.03 10-10-3. Laws governing – Actions; applicable to
professional associations formed prior
to January 1, 1984 ................... 660
§10A-30-1.04 10-10-4. Formation; restriction on service rendered;
applicable to professional associations
formed prior to January 1, 1984 ......... 660
§10A-30-1.05 10-10-5. Articles of association Certificate of
formation; name of association; dissolution;
applicable to professional associations
formed prior to January 1, 1984 ......... 661
§10A-30-1.06 10-10-6. Purposes; applicable to professional
associations formed prior to January 1,
1984 .............................. 662
§10A-30-1.07 10-10-7. Stock and nonstock associations; Nature
and transferability of members’ interests;
applicable to professional associations
formed prior to January 1, 1984 ......... 662
§10A-30-1.08 10-10-8. Board of governors; officers; bylaws; voting
by members or shareholders; applicable to
professional associations formed prior
January 1, 1984 ..................... 663
§10A-30-1.09 10-10-9. Powers; conveyances; exemption from
liability; applicable to professional
associations formed prior to January 1,
1984 .............................. 664
§10A-30-1.10 10-10-10. §10A-30-1.11 10-10-11. Furnishing of statements to Secretary of State; applicable to professional associations formed prior to January 1, 1984 ......... Effect of chapter article on professional relationships; liability of members or shareholders; applicable to professional associations formed prior to January 1, 1984 .............................. 665 665
§10A-30-1.12 10-10-12. §10A-30-1.13 10-10-13. Professional services to be rendered only through licensed officers or employees; applicable to professional associations formed prior to January 1, 1984 ......... Withdrawal of members and employees becoming disqualified to practice; proceedings to dissolve noncomplying association; applicable to professional associations formed prior to January 1, 1984 .............................. 666 667
§10A-30-1.14 10-10-14. §10A-30-1.15 10-10-15. §10A-30-1.16 10-10-16. Purchase of membership or shares of former member or shareholder; applicable to professional associations formed prior to January 1, 1984 ..................... Continuity of association independent of members of shareholders; applicable to professional associations formed prior to January 1, 1984 ..................... Distribution of assets on dissolution; applicable to professional associations formed prior to January 1, 1984 ......... 667 668 668

ARTICLE 2. Close Corporations ................................ 669

§10A-30-2.01 10-2A-300. Law applicable to close corporations; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995 .......... 669
§10A-30-2.02 10-2A-301. ‘Close corporation’ defined; contents of articles of incorporation certificate of
formation; number of shareholders;
applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995 .......... 670

§10A-30-2.03 10-2A-302. §10A-30-2.04 10-2A-304.

§10A-30-2.05 10-2A-305.

§10A-30-2.06 10-2A-306.

§10A-30-2.07 10-2A-307.

§10A-30-2.08 10-2A-308.

§10A-30-2.09 10-2A-309.

§10A-30-2.10 10-2A-310.

§10A-30-2.11 10-2A-311.

§10A-30-2.12 10-2A-312.

Page

Formation of a close corporation; applicable to corporations formed as close corporations before January 1, 1995 ..... 671

Voluntary termination of close corporation status by amendment of articles of incorporation the certificate of formation; vote required; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 672

Issuance or transfer of shares of a close corporation in breach of qualifying conditions; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 672

Corporate option where a restriction on transfer of shares is held invalid; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995 ..................... 674

Agreements restricting discretion of directors; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 674

Management by shareholders; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995 ..................... 675

Appointment of custodian for close corporation; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 676

Appointment of a provisional director in certain cases; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 677

Shareholders’ agreements; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995 ..................... 678

Shareholders’ option to dissolve corporation; applicable to corporations formed as close corporations or electing close corporation status prior to January 1, 1995.......... 678

§10A-30-2.13 10-2A-313. Effect of the close corporation provisions on

other laws; applicable to corporations

formed as close corporations or electing

close corporation status prior to

January 1, 1995 ..................... 679

Cross-Reference Table ......................................... 681