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S.F. No. 666 - Business Organizations
 
Author: Senator Melisa Franzen
 
Prepared By:
 
Date: March 2, 2015



 

This bill makes technical and conforming changes to the Minnesota Business Corporation Act, Limited Liability Company Act, and Revised Uniform Limited Liability Company Act. It corrects cross-references and makes other technical corrections, as well as reconciling the Revised Uniform Limited Liability Company Act with other amendments made to the business organization statutes last session. The Limited Liability Company Act will continue to apply to companies organized before August 1, 2015, although they can elect to be governed by the revised act after it becomes effective. By January 1, 2018, all limited liability companies are subject to the revised act.

Sections 1, 28, 29, 31, and 43 correct internal cross-references.

Section 2 expands the definition of “organization” under the Business Corporation Act to include several types of limited partnerships and other persons who have a governing statute.

Sections 3 and 14 amend the definitions of “person” to include references to various types of legal entities.

Sections 4 and 5 amend the definitions applicable to conversions in the Business Corporation Act to include any organization, not just corporations or limited liability companies.

Section 6 amends the definition of “organizational documents” to make it a more generic reference to records that create an organization under its governing statute.

Sections 7 and 17 define “governing statute” in the Business Corporation Act and Limited Liability Company Act.

Sections 8 and 20 provide that dissenters’ rights are available after a plan of conversion is adopted and becomes effective.

Sections 9 and 21 contain new conversion requirements under which a corporation or limited liability company may convert into a corporation, limited liability company, or other organization.

Sections 10 and 22 govern the internal process for adopting a plan of conversion.

Sections 11, 23, and 42 contain the process for business organizations to file articles of conversion with the secretary of state.

Sections 12 and 25 clarify the manner in which a converted organization is the same entity that existed before the conversion.

Sections 13 and 24 amend statutes dealing with restrictions on conversions in cases where shareholders will have personal liability with respect to a converted organization to provide that a plan is effective only under specified circumstances.

Sections 15 and 16 add definitions of “converted organization” and “converted limited liability company” to the Limited Liability Company Act.

Section 17 defines “governing statute.”

Section 18 defines “organizational documents.”

Section 19 defines “personal liability.”

Section 26 amends the Revised Limited Liability Company Act to authorize companies to lend money, guarantee obligations, and provide surety under certain circumstances.

Sections 27, 36, and 38 to 40 correct terminology.

Section 30 amends the required contents of articles of organization under the revised act to clarify that the name of the initial agent for service of process must be included only if the company has an agent.

Sections 32 to 35, 37, and 41 add clarifying cross-references.

Section 44 clarifies application of the Limited Liability Company Act and Revised Limited Liability Company Act to companies organized before and after specified dates.

Section 45 repeals the Business Corporation Act conversion statutes that are replaced by new provisions in the bill.

 
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